Publication Date: December 2001

Bulletin ID: DLB-01-28

Summary: 1997-98 and 1998-99 Direct Loan Program Year Processing

December 2001

DLB-01-28

Dear Partner,

Positive Ending Cash Balances

Program Year 1997-98

Effective November 16, 2001, all processing by the Loan Origination Center (LOC) for program year 1997–98 stopped. All schools with a positive ending cash balance greater than $1000 have been transferred to Case Management and Oversight (CMO). All data received by the LOC before November 16, 2001 will be processed. Any data received after November 16, 2001 will not be processed without authorization from CMO.

Program Year 1998-99

Effective November 23, 2001, all processing by the Loan Origination Center (LOC) for program year 1998–99 stopped. All schools with a positive ending cash balance greater than $1000 have been transferred to CMO. All data received by the LOC before November 23, 2001 will be processed. Any data received after November 23, 2001 will not be processed without authorization from CMO.

CMO is currently reviewing the status of those institutions with positive ending cash balances. CMO will send these schools a letter explaining what actions the school must take to resolve any outstanding issues. For further assistance, please contact Shirley Brown at Shirley.Brown@ed.gov or Barbara Murray at Barbara.Murray@ed.gov.

Negative Ending Cash Balances

If your school’s LOS 732 report for 1997/98 and/or 1998/99 shows a negative ending cash balance, you must resolve the balance by December 31, 2001. Schools with negative balances greater than -$1000 after that date will be referred to CMO for their review.

A Negative Ending Cash Balance may be a result of, but not limited to, one or more of the following issues:

1. Your school has drawdowns posted in the wrong program year.

2. Your school has excess cash posted to the wrong program year.

3. Your school has not drawn down enough funds.

4. Your school has not sent adjustment records to the LOC.

5. Your school sent a borrower payment to the LOC as excess cash.

6. Promissory Notes have not been received for loans that have reported disbursements.

If your LOS 732 report for 1997/98 and/or 1998/99 show(s) that your school has a negative ending cash balance and your school’s records agree with that balance, please send an email no later than December 14, 2001 stating that your school’s records agree with the negative balance and requesting these funds. Address the email to:

Isiah.Dupree@ed.gov and Sharon.Smith@ed.gov.

If your school’s records do not agree with the negative ending cash balance reflected on the LOS 732 report for 1997/98 and/or 1998/99, please contact your Client Account Manager or your LOC Customer Service Representative (CSR) for assistance in identifying and resolving any outstanding issues. These issues must be identified and reported to the LOC by December 31, 2001.

Thank you for your ongoing partnership in the Direct Loan Program.

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                                       Sincerely,

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                                       Jane Holman

                                       Acting Lead, Title IV Delivery

                                       Schools Channel