By EDFUND’s Compliance and Program Review Department

Institutions are reviewed by many entities, including their accrediting agency, the U.S. Department of Education, independent auditors, guaranty agencies, to name a few. Any one of these reviewing bodies may ask you to provide them with a specific copy of a contract or agreement, as in these scenarios:

Institutions must be accredited in order to be eligible to participate in Federal aid programs. [34 CFR 600.4(a)(5), 34 CFR 600.5(a)(6), 34 CFR 600.6(a)(5)]

Can you find documentation that supports that your institution is currently accredited?

Institutions must be legally authorized. That is, the legal status granted to an institution through a charter, license, or other written document issued by the appropriate agency or official of the State in which the institution is physically located. [34 CFR 600.2 Definitions, 34 CFR 600.4(a)(3), 34 CFR 600.5(a)(4), 34 CFR 600.6(a)(3)]

Can you find documentation that supports that your institution meets the requirement of “legally authorized?”

An eligible institution may participate in any Title IV, HEA program, other than LEAP (Leveraging Educational Assistance Partnership) and NEISP (National Early Intervention Scholarship Partnership) programs, only if the institution enters into a written Program Participation Agreement (PPA) with the U.S. Secretary of Education. The PPA details the initial and continued participation requirements of an eligible institution in any Title IV, HEA program. In addition to complying with program regulations, this agreement may also list additional conditions that the Secretary requires the institution to meet. [34 CFR 668.14(a)(1)] The PPA also includes the Eligibility and Certification Approval Report (ECAR). These two documents constitute the Department’s determination that your institution has qualified to participate in the Title IV, HEA programs.

Your institution’s president or chief executive officer signs the PPA. The signed copy may not be in the financial aid office. Do you know where these documents are retained?

Written agreements are required whenever students are allowed to earn credit at your institution while attending another school. These (consortium) agreements can be between

Could these agreements be found in your registrar’s office? The president’s office? Your office?

Do you use a third-party servicer? This may be an individual, a State, or a private profit or nonprofit organization that enters into a contract with your institution to administer, through either manual or automated processing, any aspect of your institution’s participation in any Title IV, HEA program. [34 CFR 668.2(b) – Definitions: Third-party servicer, 34 CFR 682.200(b) – Definitions: Third-party servicer. Also see 34 CFR 668.25]

Are you aware that another office may have entered into a contract to perform some required activity? Refer to the above noted citation and see a list of examples of activities that fall under the umbrella of a third-party servicer. Determine if any have been contracted out and locate where the contract is maintained.

Institutions are required to notify the Secretary of any third-party servicer contract. Can you locate the copy of the notice to the Secretary that your institution has a contract and/or, when applicable, has significantly modified an existing contract with the third-party servicer? This notice should be submitted within 10 days of entering into, modifying or terminating the contract. Notice is also required should the contractor stop providing services, goes out of business or has filed for bankruptcy. [34 CFR 668.25(e)]

Does your institution have an assessment center, participate in a Department-approved state process or do you use a certified test administrator for those students needing to take an ability to benefit test? [34 CFR 668.151(a)(1) and 34 CFR 668.151(d)(1)] If you use a certified test administrator, have you retained documentation supporting that the individual is, in fact, a “certified” test administrator?

Additionally, if your institution is a “school lender,” can you locate the contract of guarantee that is between your institution and the guaranty agency? [34 CFR 682.200(b) Definitions: School lender]

If your institution participates in a federal and/or state work-study or cooperative education program, your institution should have written agreements. These agreements should be available upon request by any reviewing agency.

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