Excess Liquid Capital Appeals Due by October 25
October 19, 2016
Based on Section 466 (c) of the Higher Education Act, the Department of Education is requiring institutions of higher education to return the federal share of any Excess Liquid Capital (ELC) from their Federal Perkins Loan Revolving Fund. ELC is the amount of the fund’s “Cash on Hand” that is in excess of the institution’s estimated immediate need for the Perkins Loan Program.
Last year the Department of Education sent out a spreadsheet for schools to use in determining if they had ELC. This year, the Department will be making the determination after submission of your school’s FISAP and will email your Financial Aid Administrator if ELC was computed. (Note: This email was sent out in the beginning of October.) If you have not already done so, contact your Financial Aid Director to find out if they have received an ELC message from the Department.
Requests for an appeal: Institutions that have ELC and can justify that the return of funds would result in a shortfall for future awards to students, may ask for an adjustment to their ELC. In the eCB system, the institution should click on the ELC Adjustment Request link which will appear under the Perkins Excess Liquid Capital heading located on the left-side menu bar and enter a justification in the text box. Schools must provide justification to the Department including projected disbursements or estimated need for the current or upcoming award year. Adjustment requests must be submitted by October 25, 2016. The school will be notified when a decision has been made.
If you have questions, contact the Campus-based Call Center at 877-801-7165 or email them at: CBFOB@ed.gov Please refer to the electronic notice that was sent out on August 1, 2016: https://goo.gl/N3CR5A
In order to avoid ELC, Perkins Loan administrators should ensure that their Perkins Loans are being fully awarded and disbursed. Below are a few steps to avoid or limit ELC:
Talk with your Financial Aid Office and make sure they are fully awarding Perkins.
Provide your Financial Aid Office with your updated Perkins cash balance, so that they can possibly award more students.
Contact students that have been awarded Perkins, but have not signed their promissory note or completed their entrance counseling so that their Perkins loan can be disbursed.
Another option is to repackage any students that have a student account balance with a Perkins Loan if they are eligible. In your discussions on campus, be sure to let your colleagues and upper administration know the importance of awarding all Perkins funds so that your institution does not have to return ELC.
ELC funds must be returned to the Department by November 17, 2016. For specific guidance for returning Perkins Loan funds to the Department, refer to the “Returning Perkins Funds” instructions on the Campus-Based Processing Information Page on the IFAP Website: https://goo.gl/HL3eg6
If you have any questions on the ELC process, feel free to contact COHEAO. Please contact Executive Director Harrison Wadsworth (hwadsworth@wpllc.net) and Associate Director Wes Huffman (whuffman@wpllc.net) or any members of the COHEAO Board of Directors. Contact information for COHEAO Board members is available here.
