ED Announces Reimbursement for Perkins Service Cancellations & Distribution of Assets from the Perkins Loan Revolving Fund

After years of advocacy from COHEAO, earlier today, the Department of Education (ED) posted a notice, “Distribution of Assets from the Perkins Loan Revolving Fund and the Reimbursement for Perkins Service Cancellations,” announcing that ED has determined it has the authority to reimburse institutions for their institutional share of Perkins Loan Service Cancellations.

The notice also alerts institutions that later this fall, they will be receiving a letter regarding the amount and deadlines by which those institutions will have to return their Federal Share back to ED. That letter will also specify the amount of each institution’s reimbursement for loan cancellations. The notice says those reimbursements may be partial at first, and occur over several years.

Reimbursement for cancelled loans is something that COHEAO has long advocated for and this is a major win for institutions long involved in the Perkins Loan Program. While this is a positive first step, COHEAO will continue to work with and engage ED on the details of the wind down and reimbursement process as it progresses.

The following is from the announcement:

“Recently, however, the Department determined that it has the authority to reimburse institutions the institutional share of Perkins Loan Service Cancellations from the Perkins Fund.  As a result, later this year, the Department will be sending institutions participating in the Perkins Loan program a letter regarding the amount and deadlines by which the institution must return to the Department the Federal Share and remove and return to the institution the Institutional share of the Perkins Loan Revolving Fund (the Distribution of Assets).  Institutions must return to the Department only the Federal share that has been requested. 

The letter will also specify the amount of the institution’s reimbursement for Perkins Loan Service Cancellations.  The amount an institution is reimbursed may be a partial reimbursement for the institutional share of Service Cancellations. The Department anticipates providing additional reimbursements in future years. 

Institutions should not remove and return any funds to the Department or the institution until the institution has been notified to do so.” 

If you have any questions regarding today’s announcement – our upcoming COHEAO Webinar on 9/12 with Tamy Abernathy from ED’s Office of Federal Student Aid is a perfect opportunity to ask them!

Tamy will answer your questions on the filing of the annual Fiscal Operations Report and Application to Participate, commonly known as the FISAP and provide updates on the recent reimbursement announcement! The question-and-answer webinar will aim to address any questions or clarifications you may be seeking on how to properly fill out the FISAP so your campus is in compliance with federal law.

Please come prepared with questions for ED on the FISAP and today’s announcement!

You can email questions in advance to Greg Marak (gmarak@bosepublicaffairs) or enter them when you register.