WSR 07-08-110

PROPOSED RULES

HIGHER EDUCATION

COORDINATING BOARD

[ Filed April 4, 2007, 11:11 a.m. ]

Original Notice.

Preproposal statement of inquiry was filed as WSR 06-15-093.

Title of Rule and Other Identifying Information: 1. Changes to the state need grant award amount to recognize the tuition charged to students engaged in the community college applied baccalaureate degree program.

2. Changes to add the eligibility criteria for proprietary school participation in the state student aid programs and the process to follow when eligibility criteria falls below the acceptable standard.

Hearing Location(s): Higher Education Coordinating Board, 917 Lakeridge Way, 3rd Floor Conference Room, Olympia, WA 98502, on May 25, 2007, at 9:00 a.m.

Date of Intended Adoption: June 28, 2007.

Submit Written Comments to: Julie Japhet, 917 Lakeridge Way, P.O. Box 43430, Olympia, WA 98504-3430, e-mail Juliej@hecb.wa.gov, fax (360) 704-6250 by June 1, 2007.

Assistance for Persons with Disabilities: Contact Julie Japhet by May 18, 2007.

Purpose of the Proposal and Its Anticipated Effects, Including Any Changes in Existing Rules: 1. To recognize tuition charged to students engaged in community college applied baccalaureate degree programs.

2. To enhance eligibility standards for proprietary school participation in student aid programs. Clarify the process and expectations for the proprietary sector and the process when performance falls below acceptable standards.

Reasons Supporting Proposal: To comply with recent changes in law and to protect the state and students' interest in financial aid programs.

Statutory Authority for Adoption: Chapter 28B.92 RCW.

Rule is not necessitated by federal law, federal or state court decision.

Name of Proponent: Higher education coordinating board, public.

Name of Agency Personnel Responsible for Drafting, Implementation and Enforcement: Julie Japhet, 917 Lakeridge Way, Olympia, WA 98502, (360) 753-7840.

No small business economic impact statement has been prepared under chapter 19.85 RCW. The proposed rule affects student and proprietary school participation in the state need grant program. The rule does not affect small business in Washington.

A cost-benefit analysis is not required under RCW 34.05.328. The higher education coordinating board is not named in the RCW.

April 4, 2007

John Klacik

Director of Student Financial Aid

OTS-9671.1


AMENDATORY SECTION(Amending WSR 06-17-046, filed 8/8/06, effective 9/8/06)

WAC 250-20-013   Institutional eligibility.   (1) For an otherwise eligible student to receive a state need grant, he or she must be enrolled in an eligible program at a postsecondary institution approved by the higher education coordinating board for participation in the state need grant program (((except as specified in WAC 250-20-021 less-than-half-time pilot project))). To be eligible to participate, a postsecondary institution must:

(a) ((Be a public university, college, community college, or vocational-technical institute operated by the state of Washington, or any political subdivision thereof, or any other university, college, school or institute in the state of Washington offering instruction beyond the high school level with full institutional accreditation by an accrediting association recognized by rule of the board.)) Be a postsecondary institution as defined in WAC 250-20-021(3).

(b) Participate in the federal Title IV student financial aid programs, including, at a minimum, the Federal Pell Grant program.

(2) In addition, a ((for-profit institution must:

(a) Be certified for participation in the federal Title IV student financial aid programs. A for-profit institution that is provisionally certified for participation in the federal Title IV student financial aid programs due to its failure to meet the factors of administrative capability or financial responsibility as stated in federal regulations, or whose participation has been limited or suspended, is not eligible to participate in the state need grant program until its full eligibility has been reinstated.

(b) Demonstrate to the satisfaction of the board that it is capable of properly administering the state need grant program. In making a determination of administrative capability, the board will consider such factors as the adequacy of staffing levels, staff training and experience in administering student financial aid programs, standards of administrative capability specified for purposes of federal Title IV program eligibility, its student withdrawal rate, its federal student loan cohort default rate, and such other factors as are reasonable. In determining the administrative capability of participating institutions, the board will also consider the institution's compliance with state need grant program regulations and guidelines.

(c) Demonstrate to the satisfaction of the board that it has the financial resources to provide the services described in its official publications and statements, provide the administrative resources necessary to comply with program requirements, and that it meets the financial responsibility standards for participation in the federal Title IV programs.

(d) Renew its eligibility each year under these standards.

(3) Nothing in this section shall prevent the board, in the exercise of its sound discretion, from denying eligibility or terminating the participation of an institution which the board determines is unable to properly administer the program or to provide advertised services to its students)) proprietary institution must demonstrate to the satisfaction of the board:

(a) That it is certified for participation in the federal Title IV student financial aid programs. A proprietary institution that is provisionally certified due to its failure to meet standards of administrative capability or financial responsibility is not eligible to participate in the state need grant program. Institutions which have been limited or suspended from Title IV programs are not eligible to participate in the state need grant program. The board reserves the right to make exceptions for special circumstances such as ownership changes or a change in the accrediting agency.

(b) That it is capable of properly administering the state need grant program. In making this determination, the board will consider such factors as the institution's:

(i) Adequacy of staffing levels.

(ii) Staff training and experience in administering student financial aid programs and turnover in key personnel.

(iii) Compliance with the standards of administrative capability specified for purposes of federal Title IV program eligibility.

(iv) Pending legal regulatory issues.

(v) Written student complaints.

(vi) Compliance with state aid program regulations and guidelines.

(vii) Ability to maintain electronic systems to support state aid program tracking, payment requests and reporting obligations.

(c) That it is maintaining acceptable performance levels. In making this determination the board will consider such factors as the institution's:

(i) Student completion rate.

(ii) Student placement rate.

(iii) Student loan cohort default rate.

In evaluating completion and placement standards, the board will rely on the standards of the institution's accrediting agency or the standard established between the board and the institution at the time the participation agreement is signed. Multiple year averages will be considered in evaluating these standards. Each participating institution will submit its annual accreditation report to the board.

(d) That it is financially stable and has adequate financial resources to provide the services described in its official publications and statements. Institutions must meet the administrative and financial standards for participation in the federal Title IV programs. In making this determination, the board will consider such factors as:

(i) The school's annual financial statements.

(ii) The Department of Education's composite financial score.

(iii) Federal program review findings.

(iv) State reauthorization or relicensing reports.

(v) Accrediting agency show cause or other findings.

(vi) Enrollments by program and intent to terminate an existing program.

(vii) Enrollment trends.

(e) If evaluation of an institution's administrative capability, performance level, or financial strength results in concerns about the institution's participation in the state aid programs, the board may:

(i) Request additional information as well as give the school the opportunity to provide additional clarifying information.

(ii) Place an institution in a probationary status and specify the corrective actions which need to occur.

(iii) Require a letter of credit or bond.

(iv) Limit, suspend, or terminate an institution's participation in accordance with WAC 250-20-081.

(3) "Probation" indicates the board has determined that the school has one or more significant deficiencies for which corrective action is required within a specified time period.

(4) The school must renew its eligibility each year under these standards or as requested by the board. A school that has lost eligibility to participate must complete a new application for reconsideration.

(5) Nothing in this section shall prevent the board, in the exercise of its sound discretion, from denying eligibility or terminating the participation of an institution which the board determines is unable to properly administer the program or provide advertised services to its students.

(6) If an institution disagrees with actions taken by the board, the institution can appeal the action per the procedure outlined in WAC 250-20-081.

[Statutory Authority: Chapter 28B.80 RCW. 06-17-046, 250-20-013, filed 8/8/06, effective 9/8/06; 95-17-045, 250-20-013, filed 8/11/95, effective 9/11/95.]


AMENDATORY SECTION(Amending WSR 04-08-060, filed 4/5/04, effective 5/6/04)

WAC 250-20-041   Award procedure.   (1) The institution will offer grants to eligible students from funds reserved by the board. It is the institution's responsibility to ensure that the reserve is not over expended within each academic year.

(2) The state need grant award for an individual student shall be the base grant, appropriate for the sector attended and a dependent care allowance, if applicable, adjusted for the student's family income and rate of enrollment. Each eligible student receiving a grant must receive the maximum grant award for which he or she is eligible, unless such award should exceed the student's overall need or the institution's approved gift equity packaging policy.

(3) The grant amount for students shall be established as follows:

(a) The award shall be based on the representative average tuition, service, and activity fees charged within each public sector of higher education. The average is to be determined annually by the higher education coordinating board. The award for students enrolled in the applied baccalaureate pilot program authorized in RCW 28B.50.810 shall be based on the representative tuition and fees used for the comprehensive universities.

(b) Except for the 2003-04 and 2004-05 academic years, the base grant award shall not exceed the actual tuition and fees charged to the eligible student. During the 2003-04 and 2004-05 years the grant award may exceed the tuition charged to the eligible student by fifty dollars.

(c) The base grant award for students attending independent four-year institutions shall be equal to that authorized for students attending the public four-year research institutions. The base grant for students attending private vocational institutions shall be equal to that authorized for students attending the public community and technical colleges.

(4) The total state need grant award shall be reduced for students with family incomes greater than fifty percent of the state's median and for less than full-time enrollment.

(a) Students whose incomes are equal to fifty-one percent to seventy-five percent of the state's median family income shall receive seventy-five percent of the maximum award. Students whose incomes are equal to seventy-six percent to one hundred percent of the state's median family income shall receive fifty percent of the maximum award. Students whose incomes are equal to one hundred one percent to one hundred twenty-five percent of the state's median family income shall receive twenty-five percent of the maximum award.

(b) Eligible students shall receive a prorated portion of their state need grant for any academic period in which they are enrolled at least half-time, as long as funds are available. Students enrolled at a three-quarter time rate, at the time of disbursement, will receive seventy-five percent of their grant. Students enrolled half-time at the time of disbursement will receive fifty percent of their grant.

(5) Depending on the availability of funds, students may receive the need grant for summer session attendance.

(6) The institution will be expected, insofar as possible, to match the state need grant with other funds sufficient to meet the student's need. Matching moneys may consist of student financial aid funds and/or student self-help.

(7) All financial resources available to a state need grant recipient, when combined, may not exceed the amount computed as necessary for the student to attend a postsecondary institution. The student will not be considered overawarded if he or she receives additional funds after the institution awards aid, and the total resources exceed his or her financial need by $200 or less by the end of the academic year.

(8) The institution shall ensure that the recipient's need grant award, in combination with grant aid from all sources, not exceed seventy-five percent of the student's cost-of-attendance. In counting self-help sources of aid, the aid administrator shall include all loans, employment, work-study, scholarships, grants not based on need, family contribution, and unmet need.

(9) The institution will notify the student of receipt of the state need grant.

(10) Any student who has received at least one disbursement and chooses to transfer to another participating institution within the same academic year may apply to the board for funds to continue receipt of the grant at the receiving institution.

[Statutory Authority: Chapter 28B.80 RCW and RCW 28B.10.822. 04-08-060, 250-20-041, filed 4/5/04, effective 5/6/04. Statutory Authority: 2813.80 [Chapter 28B.80 RCW]. 99-16-015, 250-20-041, filed 7/23/99, effective 8/23/99. Statutory Authority: Chapter 28B.80 RCW. 95-17-045, 250-20-041, filed 8/11/95, effective 9/11/95; 93-08-010, 250-20-041, filed 3/25/93, effective 4/25/93. Statutory Authority: RCW 28B.10.800 - [28B.10.]822. 90-04-067, 250-20-041, filed 2/5/90, effective 7/1/90. Statutory Authority: RCW 28B.10.806. 87-16-046 (Order 2/87, Resolution No. 87-59), 250-20-041, filed 7/29/87. Statutory Authority: RCW 28B.10.822. 82-15-058 (Order 9-82, Resolution No. 82-52), 250-20-041, filed 7/20/82. Statutory Authority: RCW 28B.10.806. 80-05-025 (Order 3-80, Resolution No. 80-56), 250-20-041, filed 4/14/80; 79-11-031 (Order 11-79, Resolution No. 80-18), 250-20-041, filed 10/11/79; 79-07-021 (Order 5-79, Resolution No. 79-33), 250-20-041, filed 6/15/79; Order 2-77, 250-20-041, filed 4/13/77; Order 3-75, 250-20-041, filed 4/25/75; Order 1-75, 250-20-041, filed 3/7/75; Order 1-74, 250-20-041, filed 4/9/74; Order 1-73, 250-20-041, filed 7/2/73.]

Washington State Code Reviser's Office