Maintained for Historical Purposes

This resource is being maintained for historical purposes only and is not currently applicable.

Federal Pell Grant Program - Student Eligibility

AwardYear: 1997-1998
EnterChapterNo: 4
EnterChapterTitle: Federal Pell Grant Program
SectionNumber: 1
SectionTitle: Student Eligibility
PageNumbers: 3-8

Unlike the student's eligibility for the campus-based programs (see
chapters 5 through 8), a student's eligibility for Pell does not depend
on the availability of funds at the school. The Department provides
funds to each participating school to pay eligible students based on
the Payment Data the school submits to the Department. (See Section
7 of this chapter for more on the funding process.)

Because the Department pays Pell awards to all eligible students, the
school is not responsible for selecting recipients. However, the
school must ensure that each recipient meets the eligibility
requirements for the Federal Pell Grant Program, as discussed below,
and that each eligible student is paid the amount for which he or she
is eligible.


Most of the student eligibility requirements for the Federal Pell Grant
Program are common to all the Student Financial Assistance (SFA)
Programs. General SFA eligibility requirements are discussed in
greater detail in Chapter 2, Section 1. Briefly, for a student to be
eligible to receive assistance from the SFA Programs, he or she must

- be either a U.S. citizen or an eligible noncitizen;

- have a high school diploma or its recognized equivalent (such
as a General Education Development [GED] certificate). (See
Chapter 2, Section 1 for a complete description of alternatives);

- be meeting satisfactory academic progress standards in his or her
course of study; and

- file a Statement of Educational Purpose and a Certification
Statement on Overpayments and Defaults (see Chapter 2,
Section 1).

A student is NOT eligible for any SFA funds if he or she

- is enrolled in an elementary or secondary school,

- is in default on an SFA loan or owes a repayment or is liable for
an overpayment on an SFA grant, or

- has borrowed in excess of the annual or aggregate loan limits for
the SFA loan programs.

In most cases, if a student is a member of a religious order, he or she
is eligible ONLY for unsubsidized loans (see Chapter 2, Section 1).

[[Financial aid history]]
If a student transfers from one postsecondary school to another, the
new school must get a financial aid history for the student. The
school may use the National Student Loan Data System (NSLDS) to
receive the financial aid history, or may request a financial aid
transcript from the previous school (see Chapter 2, Section 2).
However, there are some limits on the use of NSLDS for midyear
transfer students (see Section 2).


A student must be an undergraduate to receive a Pell. The regulations
define an undergraduate as one who is enrolled in an undergraduate
course of study and who has not earned a baccalaureate degree or its
equivalent or a first professional degree.*1* ("Professional degree"
means a degree offered by professional programs such as pharmacy,
dentistry, or veterinary programs.)

[[Length of undergraduate study]]
An undergraduate course of study under this definition is one that
usually does not exceed 4 academic years or is a program of 4 to 5
academic years designed to lead to a baccalaureate or first
professional degree. If the program is longer than 5 years (for
example, a 6-year pharmacy program), then students enrolled in that
program are considered undergraduate students only for the first 4
academic years of the program.

[[Foreign, unaccredited degrees]]
It does not matter if the baccalaureate or professional degree is from
an unaccredited or foreign school, or is not accepted or recognized
by the school at which the student is enrolled. A student who has
earned such a degree is still ineligible for Pell.

[[Degrees below the baccalaureate level]]
Note that a student who has already received an associate degree, but
who enrolls in another undergraduate program, would continue to be
considered an undergraduate student until he or she has completed
the academic curriculum requirements for a first bachelor's degree.
(This is true for ANY student who has received a certificate or
diploma below the baccalaureate level.)

If a student who is an undergraduate incorrectly reported on the Free
Application for Federal Student Aid (FAFSA) that he or she will be a
graduate student or has a bachelor's degree, this information MUST
be corrected. Because the application information indicated that the
student was not an undergraduate, the Department's records will
show that he or she is ineligible for Pell. If the application
information is not corrected, THE SCHOOL WILL BE UNABLE
TO RECEIVE PELL FUNDS from the Department for that student.


[[Federal, state prisoners not eligible--"Dear Colleague"
Letter P-94-7]]
The Violent Crime Control and Law Enforcement Act of 1994
amended the HEA to provide that students incarcerated in federal
and state institutions are not eligible for Pells. However, students
incarcerated in local penal institutions may still receive Pells.
Students incarcerated by jurisdictions defined as a state in the law
(such as the District of Columbia) are considered to be incarcerated
in a state institution and are not eligible for Pell. A student is not
considered incarcerated if he or she is in a half-way house or home
detention, or is sentenced to serve only on weekends.

Allowable costs of attendance for incarcerated students are limited to
tuition and fees and only those books and supplies related to the
student's course of study.


The Expected Family Contribution (EFC) formula is the standard
formula used in determining financial need for the SFA Programs.
The formula produces an EFC number. To be eligible for a Pell for
1997-98, a student must have a nine-month EFC of 2500 or less.

The less the student and family can contribute to education costs, the
greater the Pell the student may receive. Thus, the neediest students
will have an EFC of 0 and may be eligible for the maximum Pell
award ($2,700 for 1997-98) if their cost of education (also known as
cost of attendance) will be at least $2,700 and if they will be
attending full time for a full academic year.

[[The graphic on page 4-6 is currently unavailable for viewing.
Please reference your paper document for additional information.]]

As the EFC increases, the amount of the award decreases; after the
maximum EFC eligibility (2500 for 1997-98), the award becomes 0.

The EFC is computed by the Central Processing System (CPS) and is
based on the information the student reported on the FAFSA. The
EFC is included along with the student's application information on a
Student Aid Report (SAR) or Institutional Student Information
Record (ISIR). (See A Guide to 1997-98 SARs and ISIRs for more

[[Professional judgment]]
The financial aid administrator, through professional judgment, may
adjust one or more of the data elements used to calculate the EFC.
The adjustment must be based on a student's individual
circumstances and must be documented in the student's file. Note
that aid administrators may not adjust the EFC number or the
formula. If the financial aid administrator makes an adjustment for
the Federal Pell Grant Program, the same adjustment must be used
when awarding campus-based aid, subsidized Federal Stafford
Loans, and subsidized Direct Stafford Loans. For more information
on adjusting the EFC, see the 1997-98 Counselor's Handbook for
Postsecondary Schools.

[[EFC change affecting award reprocessed through CPS]]
Note that any change in the EFC that results in a change in the
student's Pell award must be submitted through the CPS to establish
the student's eligibility for Pell payment. Resubmission is not a
requirement for EFC changes that do not affect the Pell award;
however, if the school does not submit these changes for
reprocessing, it must be sure that the EFC it submits on its payment
record to the Department for the Federal Pell Grant Program matches
the EFC calculated by the CPS. A school is never required to
resubmit corrections or adjustments for recalculation of the EFC for
the campus-based programs, the Federal Family Education Loan
Program, or the Direct Loan Program.


[[Output documents]]
The SAR is a paper document sent to the student by the application
processor. An ISIR is a computer-generated electronic record sent to
a school by the CPS. These output documents (SARs and ISIRs)
contain the student's application information, the EFC, and the
results of the database matches. To pay a student his or her Pell
award, a school must have received a valid output document
containing an eligible nine-month EFC while the student is still
enrolled and eligible. Once it is received, assuming all other
eligibility requirements are met, the school MUST pay the student.

All applicants receive a SAR in the mail from the CPS. Students who
apply through EDE receive a one part SAR, called a SAR
Information Acknowledgement. The school is not required to
provide these students with a copy of the ISIR it received from the
CPS. For purposes of documenting the student's eligibility for
payment, the SAR Information Acknowledgement is the same as a
two part SAR: A school MUST pay an eligible student who submits a
valid SAR Information Acknowledgement.

[[Signature requirements]]
A valid output document is defined as one where all the information
used to calculate the EFC is complete and accurate. The student is
not required to sign an output document. Note that the student is still
required to sign the statement on the FAFSA certifying that the
information provided is correct. (See the 1997 98 Counselor's
Handbook for Postsecondary Schools for more information on
signature requirements.)

[[34 CFR 668.24(d)(3)]]
The school may store an electronic ISIR in its electronic format,
rather than printing and storing paper. Schools must be careful to
store the electronic record exactly as received from the CPS. If the
student applies electronically through his or her school, the school
must be sure that it keeps the signed FAFSA. In addition, the school
must keep signed documentation of any corrections submitted
electronically. Effective July 1, 1997, the school may keep the
student's SAR or the signed FAFSA and correction documentation
for students applying electronically in either the original hard copy
format or an imaged format from which it can produce an accurate,
legible copy of the original (see Chapter 3, Section 7).

[[August 31 / last day of enrollment deadline]]
The school must receive the valid SAR or ISIR no later than August
31 following the end of the award year, or the student's last day of
enrollment, whichever comes first. As mentioned above, the student
must still be enrolled and eligible for payment at the time the SAR or
ISIR is received. If the student leaves school or completes the
program and the school does not have a valid SAR or ISIR, the
student is not eligible for a Pell.

[[Verification extension]]
The deadline above is extended for students undergoing verification.
The verification extension allows the school to accept a student's
revised SAR or ISIR up to 60 DAYS AFTER the student's last day of
enrollment. However, the extension cannot go beyond the August 31
deadline mentioned above. The school must have ALREADY
received a SAR or ISIR with an eligible EFC while the student was
enrolled and eligible for payment.

*1* Occasionally, a student will complete the requirements for a
bachelor's degree but will continue taking undergraduate courses
without accepting the degree. The school must decide at what point it
considers the student to have completed the baccalaureate course of
study--when the student completes the requirements for the degree,
or when the student actually receives the degree. If the school
considers the student to have completed the baccalaureate course of
study, the student is no longer eligible to receive a Pell.

Last Modified: 07/28/1998