ChapterTitle: Key Fiscal Procedures in Title IV Campus-Based Programs
SectionTitle: Funding Process
This chapter gives an overview of fiscal matters that pertain solely to
Title IV campus-based programs (Federal Supplemental Educational
Opportunity Grant, Federal Work-Study, and Federal Perkins Loan).
Topics discussed include the funding process, federal and nonfederal
shares of funding, administrative cost allowance, and transferring
funds between programs.
administrative cost allowance (ACA)
carry forward/carry back
Expanded Lending Option (ELO)
Federal Capital Contribution (FCC)
Fiscal Operations Report and Application to Participate (FISAP)
Institutional Capital Contribution (ICC)
Job Location and Development (JLD) Program
Level of Expenditure (LOE)
3.1 Funding Process
((Definition of campus-based))
Title IV campus-based funds are allocated by the U.S. Department of
Education (ED) to institutions that then, in turn, administer the funds
on behalf of ED and in accordance with applicable laws and
regulations. These programs are referred to as "campus-based"
because they are managed directly by schools rather than by ED.
To receive Title IV campus-based funds, eligible institutions must
apply for the funds annually. Schools must also report on their use
of Title IV campus-based funds on an annual basis. The report used
to satisfy both these requirements is the Fiscal Operations Report and
Application to Participate (FISAP). The FISAP is covered in detail
in Chapter 6 of this book. What follows here is a discussion of the
fiscal principles that underlie and affect an institution's application
for, and use of, campus-based funds.
To receive campus-based funds for one or more campus-based
programs, schools must submit a FISAP to ED for each award year
that they wish to receive funds. The deadline for filing the FISAP is
October 1*13* of the calendar year that precedes the award year.
For example, for 1996-97 award-year funding, institutions must file a
FISAP by October 1, 1995.
All schools are required to apply using the Electronic FISAP; the
paper version has been discontinued. The Electronic FISAP is a
software package provided by ED that allows schools to submit
FISAP data by mailing a diskette or magnetic tape OR by
transmitting data by modem. Electronic FISAP packages and
instruction booklets are distributed to eligible institutions no later
than August 1 each year.
((Application section of FISAP))
The section of the FISAP used to apply for funds collects
- the amount of funds the institution is requesting for making
awards to students and covering administrative costs,
- the students enrolled at the institution, including eligible aid
- assessments of the institution's tuition and fees, and
- the institution's expenditures of Federal Pell Grant funds and state
grant and scholarship funds.
ED then uses these data to determine the amount of federal funds the
school will receive from one or more of the campus-based programs.
This amount is called an "allocation."
3.1.2 Allocation Process
ED determines a school's allocation of campus-based funds using
allocation formulas prescribed in federal law as well as funding
levels appropriated by Congress. However, an institution will not
receive an allocation that exceeds the amount of funds it requested
on the FISAP, even if it is eligible for additional funds.
((Official Notice of Funding))
In March each year, ED sends schools an "Official Notice of
Funding" to notify them of their final allocations for each campus-
based program. This notice is a school's authorization to spend up to
the amount of federal funds listed for each campus-based program in
which it participates and for which it has requested funds. Sample
copies of an "Official Notice of Funding" for initial and
supplemental allocations can be found on pages 79 and 81 of this
Schools might not use their total allocations of campus-based funds
during an award year. If they do not, they are required to return
unexpended allocations of federal funds to ED so that the money can
be reallocated to schools that need additional campus-based funds as
supplemental allocations. This release of unexpended allocated
funds is called "deobligation."
((Deobligation of campus-based funds))
In June each year, ED sends schools a letter requesting that they
deobligate funds not spent by June 30 of that year and report the
amount of funds they expect to have used by that date. If a school
deobligates 10 percent or more of its initial (final) allocation (plus
any supplemental allocation of funds from any campus-based
program), the allocation for that program for the next award year will
be reduced by that same amount, UNLESS the school can show just
cause for underutilizing the funds in a waiver request that is
submitted to and approved by ED. The funding reduction may be
waived by ED if it finds that enforcing the funding reduction would
be counter to the interests of the affected campus-based aid program.
*13* The actual submission deadline for the FISAP is set each year
by ED. Refer to the front page of the "FISAP Instruction Booklet"
for the deadline date of the applicable year.