ED Announces Schools Not Required to Return Federal Share of Perkins Funds to the Department for Award Year 2018-19

On Friday, May 24, the Department of Education (ED) posted an announcement, “Federal Perkins Loan Program – Delay of Revolving Fund Distribution of Assets” that clearly shows ED leaders are planning to allow institutions to be reimbursed for their share of cancelled loans.

In the notice, ED said it decided to halt a required distribution of assets from institutions’ Perkins Fund for the 2018-19 Award Year. The Department is still exploring options to reimburse institutions, as was announced at the Federal Student Aid conference in 2018. COHEAO will continue its advocacy efforts with Congress and the administration to ensure schools receive their share of cancellation reimbursements.

The following is from the announcement:

“Therefore, institutions are not required to return the federal share of their Perkins Fund to the Department and should not remove the institutional share from their Perkins Fund and return it to their institution

Consequently, institutions should not report repayment of any federal share or institutional share in its next Fiscal Operations Report and Application to Participate (FISAP) due October 1, 2019. The amounts in both the “Repayment of fund capital to federal government” in Part III, Section A, Line 28 and “Distribution of excess/liquid fund capital” in Part III, Section A, line 30.2 should be the same amounts as the institution reported on the FISAP submitted by October 1, 2018. Note: Institutions that have already returned the federal share of their Perkins Fund to the Department and removed their institutional share from the Perkins Fund for the 2018–19 Award Year should report these repayments on the FISAP.”

Please email Harrison Wadsworth or Jared Solomon for additional information.