Changes to 90/10
Changes to 90-10 Calculations
(All positive to your schools)
Clients and Friends,
Congress has passed the Reauthorization of the Higher Education Act of 1965 (“HEA”), a 400-plus-page act signed into law on August 14, 2008. We have attempted to highlight the changes as they relate to 90/10. You know, the rule that if more than 90% of your tuition comes from Title IV funds you lose your eligibility! These changes are all positive and will make your compliance more attainable. We encourage your comments and questions.
90/10 is to be evaluated over a 2 year period
The new law allows schools that fail to meet the 90/10 calculations in year one, to continue to participate in Title IV programs. Schools will need to meet this 90/10 requirement by the end of the second year. This is good news to all.
Part of your Unsubsidized Loans will be considered cash paid by student
With the increase in loan limits the law is allowing schools to treat a portion of the unsubsidized loans as if the student paid these funds. This helps the schools in their calculation of the 90/10 ratios.
Institutional Loans to Students can count as cash paid
For schools that loan money to students with formal loan agreements, you will now be able to treat these loans as cash paid by the students in your 90/10 calculations. This is a new and positive change to the way institutional loans were treated in the past. The regulations are complicated, so please call us before implementing this.
Tuition Received from Non Federal Funded Programs now count toward 90/10
If you are running a program that is not eligible or you have not applied for Title IV funding but is part of your curriculum, you are now able to use these funds toward your 90/10 calculations. This is a new and positive change that will benefit your school.