##### **State Administrator's Handbook and User's Guide**

##### **Table of Contents**

Part I: History of the Leveraging Educational Assistance Partnership
(LEAP) Program
.........\...\...\...\...\...\...\...\...\...\........................\...\........\...3

Authorized in 1973 by the Higher Education Act of 1965, as
amended..........................3

First Rules were first published in 1974. First SSIG Grants
.................................\.......3

New SSIG rules were published in 1986 and
1987....................................................4

New Program rules were published in
1993.............................................................4

Allotment Formula (Essentially two
formulas)...........................................................4

New Program rules were published in
2000.............................................................4

Initial SLEAP Program Guidance Issued May 15,
2000..............................................4

SLEAP Program Guidance Issued March 29,
2001................................................\...6

The Formula
Today...................................................................................9

Part II: Administering the Leveraging Educational Assistance Partnership
(LEAP) Program and Its Subprogram Within Your State Today
...\...\................................................\...\......................................
10

PROVIDING FUNDS TO STATES MATCHING REQUIREMENTS .......................
...10

COMMUNITY SERVICE-LEARNING JOB PROGRAM\...\...\...\...\...\...
............................10

ADMINISTRATIVE PATTERNS \...\...\...\...\...\....
........................................................11

SCHOOL PARTICIPATION
\..................................................................\...\...\...\.....
11

STUDENT
ELIGIBIITY......................................................................................12

STUDENT APPLICATION PROCEDURES AND
AWARDS.......................................13

FISCAL AND REPORTING RELATIONSHIPS BETWEEN SCHOOLS AND STATE AGENCIES
...................................................................................................14

SPECIAL LEVERAGING EDUCATIONAL ASSISTANCE PARTNERSHIP (SLEAP)
PROGRAM....................................................................................................15

AUTHORIZED SLEAP ACTIVITIES
....................................................\...\...\...\.........15

Matching
Requirements.................................................................................\....15

SLEAP Maintenance of
Effort.............................................................................16

34 CFR PART 692 \-- LEVERAGING EDUCATIONAL ASSISTANCE PARTNERSHIP
PROGRAM
RULES.......................................................................................\...17

APPLICATION TO PARTICIPATE CHECK
SHEET................................................25

PERFORMANCE REPORT CHECK
SHEET.........................................................27

LEAP and SLEAP PROGRAM
DATA..................................................................30

Part I: History of the Leveraging Educational Assistance Partnership
(LEAP) Program

Formerly the State Student Incentive Grant (SSIG) Program, the LEAP
Program was established to give states incentive to develop and
administer grant programs that provide aid to students who demonstrate
substantial financial need, enabling those students to attend
postsecondary school.

The History - A Timeline of the State Student Incentive Grant (SSIG)
Program

# **1973-1975**

***The SSIG Program was authorized in 1973 by the Higher Education Act
of 1965, as Amended***

The purpose of the State Student Incentive Grant (SSIG) Program was to
give grants to states to assist them in providing grants to eligible
students with substantial financial need, enabling them to pursue their
higher education.

SSIG gave an opportunity for many states to develop new student grant
programs or expand existing ones by enlarging the class of eligible
recipients and/or by increasing the size of the grants previously
awarded.

***Rules were first published in 1974. And SSIG Grants were first
awarded to states beginning with the 1974-1975 award year.***

The program statute and rules were established with the premise that
separate appropriations would be made for the purpose of initial awards
to eligible students and for the purpose of continuation awards to
eligible students who previously received initial awards. This meant
states would have had to apply on two separate applications annually for
these two purposes.

Congress never made separate appropriations for initial and continuing
awards. So the Commissioner allotted the entire appropriation by
statutory formula for initial awards and let states determine the
distribution of their allotment between initial and continuing awards to
students within their states.

Some of the major program requirements:

-   Program administered by single state agency

-   Base Maintenance-of-Effort

-   Federal allotment may only be used by a state to pay 50% of the
    amount of student grants.

-   Matching funds may be made available by the state from state
    appropriation or from other non-Federal sources.

-   Only students that met the eligibility requirements of the program
    could benefit.

-   Students shall have substantial financial need.

-   

-   

-   

-   

-   

-   

-   

-   

-   

-   

-   Student grant award maximum was \$1,500.

**1979 -- 1981**

> 1979 The Department of Education was established.
>
> New SSIG Program rules were published in 1981 to incorporate statutory
> changes made by the Education Amendments of 1980. The new rules also
> simplified the language and requirements of the existing rules and
> collapsed the initial and continuation awards into a single program.
>
> Three-year average MOE was established.

**1986-1987**

***New SSIG rules were published in 1986 and 1987. Rules published in
1987 were needed to implement changes made by the Higher Education
Amendments of 1986***

-   

#### 1986 Rules

Required states to match with state appropriated dollars.

Also allowed a state to match its Federal allotment at the program level
rather than at the individual student grant level.

-   

#### 1987 Rules 

Clarified the new allotment formula under which SSIG funds were allotted
to the states.

Permission of a state to use up to 20% of its allotment to carry out a
program of Community Service Work Study Jobs.

***New Program rules were published in 1993, which were needed to
implement changes made by the Higher Education Amendments of 1993.***

Maximum award changed from \$2,500 to \$5000.

Fees for data collection\--No parent or student may be charged a fee
that is payable to an entity other than the state for collecting data
used to make a determination of financial need for SSIG Program
purposes.

***Allotment Formula (Essentially two formulas)***

Statute states that no state may receive less than the amount it
received in fiscal year 1979, regardless of what the state is scheduled
to receive under the allotment formula. However, it is impossible to
allot to each state the amount it received in fiscal year 1979 when the
total amount of SSIG funds appropriated for a fiscal year are less than
those appropriated in fiscal year 1979.

*Note: The fiscal year 1979 appropriation was \$76,452,287.*

1\) Below 1979 Appropriation Hold-harmless Amount:

Because of this "hold-harmless" requirement, the Department allots to
each state an amount of SSIG funds that represents the same ratio to the
current total program appropriation as the allocation the state received
in fiscal year 1979 bears to the total fiscal year 1979 appropriation
for all states.

*Note: The SSIG appropriation has remained equal to or less than this
amount; therefore, the states have received an allocation based on this
formula. Enrollment data used in the 1979 formula was taken from the
most recent data of total enrollment in institutions of higher education
at the time -- the 1976-1977 award year.*

2\) Above 1979 Appropriation Hold-harmless Amount:

Redefine students who are deemed eligible to participate in the SSIG
Program as students who were actually reported by the state as SSIG
recipients in the most recently available performance report data.

-   It was agreed that this change provided for better use of Federal
    funds under the program by 1) Rewarding states that have made a
    strong commitment of their state grant funds to the SSIG Program as
    reflected by the state's number of SSIG recipients and,

2\) Encouraging states to maintain or expand their commitment to the
SSIG Program and their level of expenditures for state grant programs.
Further, the Department believed that using the number of SSIG
recipients as the base of the allotment formula provides an incentive
for a state to expand the size of its SSIG Program in order to receive
additional Federal SSIG funds above the "hold-harmless" amount -- *if
ever the Federal appropriation reaches higher than the \$76 million
amount.*

**1998-2000**

***New Program rules were published in 2000, which were needed to
implement changes made by the Higher Education Amendments of 1998.***

Changed the name of the State Student Incentive Grant Program to the
Leveraging Educational Assistance Partnership (LEAP) Program.

New Sub-Program added: Special Leveraging Educational Assistance
Partnership (SLEAP) Program was established.

*Note statutory amendments were made to the SLEAP program in December of
2001. Final Rules were published June 26, 2001*

***SLEAP Program Guidance Issued May 15, 2000 For The 2000-2001 Award
Year***

Posted May 15, 2000\
\
TO: All State Grant Agencies\
FROM: U.S. Department of Education\
RE: **SLEAP PROGRAM GUIDANCE FOR THE 2000-2001 AWARD YEAR**\
\
We are providing this guidance to states to help them administer the
Special Leveraging Educational Assistance Partnership (SLEAP) Program
during the 2000-2001 award year (first year) in the absence of SLEAP
regulations. This guidance is based on section 415E of the Higher
Education Act of 1965, as amended (HEA), and the Education Department
General Administrative Regulations (EDGAR). The final regulations for
the SLEAP Program may change this guidance for the 2001-2002 award
year.\
\
States are reminded that in order to participate in the SLEAP Program, a
state must also participate in the LEAP Program. Therefore, a state must
satisfy the Base Year Maintenance-of-Effort (MOE), the Dollar-for-Dollar
Match, and the Three-Year-Average MOE under the LEAP Program, in order
to participate in the SLEAP Program. **For purposes of the SLEAP
Program, an educational institution's revenues and expenditures are not
considered part of the state's revenues and expenditures when meeting
the matching and MOE requirements.**

**Authorized Activity Issues for SLEAP for the 2000-2001 Award Year**

*1. What are the authorized activities under the SLEAP Program?*\
\
· The SLEAP Program includes eight authorized activities to assist
states in providing assistance to eligible students who demonstrate
financial need. Under the SLEAP Program a state may do the following:\
\
[(1) LEAP Grant Supplement]{.underline} -- Supplement its LEAP Program
by increasing LEAP Program grant amounts for postsecondary students
(including exceeding the \$5,000 maximum LEAP award limit), or by
increasing the number of LEAP recipients. This supplement may consist of
Federal SLEAP funds or SLEAP matching funds, or both, and is accounted
for and reported under SLEAP and not LEAP.\
\
[(2) Transition Programs]{.underline} -- Implement transition programs
for students who are enrolled in secondary school or who have graduated
from secondary school and are accepted for enrollment in a postsecondary
institution.\
\
[(3) Aid Programs for Critical Careers]{.underline} -- Award financial
aid to postsecondary students who wish to enter careers in information
technology, or other fields of study that the state determines are
critical to the state's workforce needs.\
\
[(4) Community Service Work-Study Jobs]{.underline} -- Pay wages or
salaries to postsecondary students for community service work-study
jobs.\
\
[(5) Teaching Scholarship Programs]{.underline} -- Establish a
postsecondary scholarship program that makes awards to students who wish
to become teachers.\
\
[(6) Mathematics, Computer Science, or Engineering Scholarship
Programs]{.underline} -- Establish a postsecondary scholarship program
that makes awards to students who wish to pursue a program of study
leading to a degree in mathematics, computer science, or engineering.\
\
[(7) Early Intervention, Mentoring, and Career Education
Programs]{.underline} -- Implement early intervention, mentoring, and
career education programs for preschool, elementary school, or secondary
school students.\
\
[(8) Merit and Academic Scholarships]{.underline} -- Award merit or
academic scholarships to postsecondary students for any field of study,
including teaching, mathematics, computer science, and engineering.\
\
*2. Must a State select more than one activity under the SLEAP
Program?*\
\
· No, a state may support one or more activities under the SLEAP
Program.\
\
*3. May a State fund financial aid awards to eligible students under
SLEAP authorized activities five (Teaching Scholarship Programs) and six
(Mathematics, Computer Science, or Engineering Scholarship Programs)?*\
\
· Yes, a state may pay financial aid awards to eligible students that
demonstrate financial need and meet the criteria for SLEAP Program
activities five and six.\
\
*4. Who is an "eligible student" under the eight authorized
activities?*\
\
· Under activities one, three, four, five, six, and eight, an eligible
student is a postsecondary student who satisfies the general eligibility
requirements of section 484 of the HEA and demonstrates financial need
as defined under the LEAP Program.\
\
· Under activity two, an eligible student is a secondary school student,
or a secondary school graduate who is accepted for enrollment in a
postsecondary institution. Under activity seven, an eligible student is
a preschool, elementary, or secondary school student. Under activities
two and seven, the student must satisfy the state's definition of
financial need, and the citizenship or residency requirements of section
484 of the HEA.

**Matching Issues for SLEAP for the 2000-2001 Award Year**

*5. What funds may a State use as matching funds under the SLEAP
Program?*\
\
· A state may use any non-Federal funds that are spent for any of the
eight authorized activities, as long as those funds are not also being
used to match other Federal programs. Non-Federal funds include, but are
not limited to, state-appropriated funds or privately donated funds.\
\
*6. Is the matching requirement under the SLEAP Program an aggregate
matching requirement among the authorized activities, so that a state
may use the non-Federal funds for one authorized activity and use the
Federal funds for a different authorized activity?*\
\
· Yes, the Federal SLEAP dollars may be spent for one authorized
activity and non-Federal funds may be used for another authorized
activity.\
\
*7. How many dollars does a State need to provide for the matching
requirement under the SLEAP Program?*\
\
· For every Federal SLEAP dollar a state spends, it must spend at least
two matching dollars from non-Federal funds.\
\
*8. May the non-Federal funds that are used as a match for SLEAP come
from a State program that also contains some LEAP Program funds (Federal
and State)?*\
\
· Yes, if all the following conditions are met:\
\
· The non-Federal funds are not reported as part of the LEAP Program for
the same award year. The fact that a part of a state program is reported
as LEAP matching funds does not prevent a state from using the part of
the program that is not reported as LEAP matching funds for SLEAP
matching funds.\
· The non-Federal funds are not being used as a match for any other
Federally funded program.\
· The non-Federal funds are used to perform at least one of the eight
authorized SLEAP activities.

**Maintenance-of-Effort Issues for SLEAP for the 2000-2001 Award Year**

*9. When a State first applies for SLEAP funds, what is the State's
SLEAP MOE requirement?*\
\
· Under the SLEAP Program, the state must assure that its expenditures
for the eight authorized activities, in the aggregate or per student, in
the preceding award year were not less than its expenditures for those
eight activities, in the aggregate or per student, in the second
preceding award year.\
\
*10. When applying for 2000-2001 SLEAP funds, what award year
expenditures must a state use to assure that it will meet the SLEAP
MOE?*\
\
· A state must compare its final 1998-1999 award year expenditures for
SLEAP activities two through eight with its actual and projected
1999-2000 award year expenditures for those seven activities. The
1999-2000 figures, when finalized, must equal or exceed the final data
for the 1998-1999 award year in order to meet the SLEAP MOE requirement
for the 2000-2001 award year.\
\
· When calculating the SLEAP MOE for the 2000-2001 award year, we will
not consider that a state has expended any funds under activity one
during award years 1998-1999 and 1999-2000, because we view activity one
as supplementing a state's LEAP Program for grants with SLEAP Program
funds. A state could not have used SLEAP funds during the 1998-1999 and
1999-2000 award years because there was no SLEAP Program during those
award years.\
\
*11. What non-Federal funds spent for need-based awards must be reported
for the MOE requirements under the SLEAP Program?*\
\
· Any non-Federal funds that a state spends for any activity or program
that falls within any of the eight SLEAP authorized activities must be
reported in the SLEAP MOE. This would apply even if the non-Federal
funds were used to match another Federal program.\
\
For example, if a state program offers need-based grants to students
pursuing an information technology field of study, the non-Federal
dollars funding that program would be counted in the SLEAP MOE. Also, in
another example, a state would include in its SLEAP MOE the state funds
spent for LEAP community service work-study jobs.

***SLEAP Program Guidance Issued March 29, 2001 For The 2001-2002 Award
Year***

## Current SLEAP Guidance

TO: All State Grant Agencies

FROM: U.S. Department of Education

RE: SLEAP PROGRAM GUIDANCE FOR THE 2001-2002 AWARD YEAR

We are providing this guidance to States to help them administer the
Special Leveraging Educational Assistance Partnership (SLEAP) Program
during the 2001-2002 award year. This guidance reflects the statutory
amendments made to the SLEAP Program by section 316 of the \"Department
of Education Appropriations Act, 2001,\" Title III of the Department of
Labor, Health and Human Services, and Education, and Related Agencies
Appropriations Act, 2001, as enacted by section 1(a)(1) of P.L. 106-554,
the \"Consolidated Appropriations Act 2001.\" We plan to revise the
SLEAP Program regulations by June 2001 to have them conform to the SLEAP
statutory changes. These statutory amendments were effective on the date
of enactment (12/21/2000), however, they do not affect SLEAP grants
awarded to the States for the 2000-2001 award year, because those grants
are subject to the terms and conditions that existed when those grants
were awarded.

States are reminded that in order to participate in the SLEAP Program, a
State must also participate in the Leveraging Educational Assistance
Partnership (LEAP) Program. Therefore, a State participating in the
SLEAP Program must continue to satisfy the Base Year
Maintenance-of-Effort (MOE), the Dollar-for-Dollar Match, and the
Three-Year-Average MOE under the LEAP Program.

In addition, States are further reminded that when meeting the MOE and
matching requirements under both the LEAP and SLEAP programs, a public
institution's revenues and expenditures are not considered part of the
State's revenues and expenditures.

**Authorized Activity Issues for SLEAP for the 2001-2002 Award Year** 

1.  What are the authorized activities under the SLEAP Program?

As a result of the statutory amendments, the SLEAP Program authorized
activities have changed starting with the 2001-2002 award year. They now
consist of three authorized activities to assist States in providing
financial assistance to eligible postsecondary students who demonstrate
financial need. Under the SLEAP Program, a State may:

1.  Supplement LEAP grant awards by increasing LEAP Program grant award
    amounts for students, or by increasing the number of LEAP Program
    grant recipients. The \$5,000 maximum LEAP award limit does not
    apply to the SLEAP funds spent for this purpose. This grant
    supplement may consist of Federal SLEAP funds or SLEAP matching
    non-Federal funds, or both, and is accounted for and reported under
    SLEAP and not LEAP.

2.  Supplement LEAP community service work-study awards by increasing
    LEAP Program community service work-study award amounts for
    students, or by increasing the number of LEAP Program community
    service work-study recipients. The \$5,000 maximum LEAP award limit
    and the 20% cap on using Federal LEAP funds for community service
    work-study awards does not apply to the SLEAP funds spent for this
    purpose. This community service work-study award supplement may
    consist of Federal SLEAP funds or SLEAP matching funds, or both, and
    is accounted for and reported under SLEAP and not LEAP.

3.  Award scholarships to eligible students for merit and academic
    achievement, or for critical careers. Scholarships for merit and
    academic achievement can be awarded to eligible students pursuing
    any field of study. Critical career scholarships can be awarded to
    eligible students who desire to enter careers in information
    technology, mathematics, computer science, or engineering, teaching,
    or other fields determined by the State to be critical to the
    State's workforce needs.

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1.  Must a State select more than one activity under the SLEAP Program?

> No, a State may select one or more activities under the SLEAP Program.

2.  May a State use SLEAP funds to pay administrative costs associated
    with any of the authorized activities?

No, a State is prohibited from using SLEAP funds to pay any
administrative costs.

**Matching Issues for SLEAP for the 2001-2002 Award Year**

What funds may a State use as matching funds under the SLEAP Program?

A State may use any non-Federal funds that are spent for any of the
authorized activities, as long as those funds are not also being used to
match other Federal programs. Non-Federal funds include, but are not
limited to, State-appropriated funds or privately-donated funds. Also,
because of the statutory changes, the matching non-Federal funds must
meet the new special rule to qualify as the State's matching share of
the SLEAP Program funds. See the next question and answer for
information on this new special rule.

1.  What is the new special rule that must be satisfied for non-Federal
    funds to qualify as a State's matching share of the SLEAP Program
    funds?

> To qualify as matching funds for the SLEAP Program, the non-Federal
> funds must represent dollars that are in excess of the total dollars
> that a State spent for need-based grants, scholarships, and work-study
> assistance in the 1999-2000 award year. The total dollars expended by
> a State in the 1999-2000 award year must include all the State funds
> it reported as part of its LEAP Program. The purpose of this special
> rule is to ensure that the SLEAP Program generates new funds from a
> State beyond the amount it spent in the 1999-2000 award year for these
> kinds of assistance before the start of the SLEAP Program (2000-2001
> award year).

2.  Is the matching requirement under the SLEAP Program an aggregate
    matching requirement for the authorized activities, so that a State
    may use the non-Federal funds for one authorized activity and use
    the Federal funds for a different authorized activity?

> Yes, the Federal SLEAP Program funds may be spent for one authorized
> activity and the non-Federal funds may be used for another authorized
> activity.

3.  How many dollars does a State need to provide for the matching
    requirement under the SLEAP Program?

> For every Federal SLEAP dollar a State spends, it must spend at least
> two dollars from non-Federal funds.

4.  May the non-Federal funds that are used as a match for SLEAP come
    from a State program that also contains some LEAP Program funds
    (Federal and State)?

Yes, if all the following conditions are met:

-   The non-Federal funds are not reported as part of the LEAP Program
    for the same award year. The fact that part of a State program is
    reported as LEAP matching funds does not prevent a State from using
    the part of the program that is not reported as LEAP matching funds
    as SLEAP matching funds.

-   The non-Federal funds are not being used as a match for any other
    Federally-funded program.

-   The non-Federal funds are used to do one or more of the authorized
    SLEAP activities.

**Maintenance-of-Effort (MOE) Issues for SLEAP for the 2001-2002 Award
Year**

1.  When a State applies for SLEAP funds, what is the State's SLEAP MOE
    requirement?

> Under the SLEAP Program, the State must assure that its expenditures
> for the authorized activities, in the aggregate or per student, in the
> preceding award year were not less than its expenditures for those
> activities, in the aggregate or per student, in the second preceding
> award year.

2.  When applying for 2001-2002 SLEAP funds, what award year
    expenditures must a State use to assure that it will meet the SLEAP
    MOE?

> The SLEAP MOE for the 2001-2002 award year requires that a State's
> expenditures for the eight authorized activities under SLEAP, in the
> aggregate or per student, in the 2000-2001 award year were not less
> than its expenditures for those eight activities, in the aggregate or
> per student, in the 1999-2000 award year. See those eight activities
> in our Electronic Announcement of May 15, 2000, on SLEAP Program
> guidance for the 2000-2001 award year. This announcement is available
> on the Information for Financial Aid Professionals (IFAP) web site
> located at
> <http://www.ifap.ed.gov/eannouncements/doc0919_bodyoftext.htm>.
>
> When calculating this SLEAP MOE, we will not consider that a State has
> expended any funds under activity one during award year 1999-2000
> because there was no SLEAP Program during that year to supplement a
> State's LEAP Program. The 2000-2001 award year figures, when
> finalized, must equal or exceed the final data for the 1999-2000 award
> year in order to meet the SLEAP MOE requirement for the 2001-2002
> award year.

3.  When will the three SLEAP authorized activities for the 2001-2002
    award year, as revised by the technical amendments, affect the SLEAP
    MOE?

> The revised statutory authorized activities will not affect the SLEAP
> MOE until the submission of the 2002-2003 award year application. We
> will provide information on calculating the 2002-2003 award year MOE
> in upcoming guidance for that award year.

4.  What non-Federal funds spent for need-based awards must be reported
    for the MOE requirements under the SLEAP Program?

Any non-Federal funds that a State spends for any activity or program
that falls within any of the eight SLEAP authorized activities must be
reported in the SLEAP MOE. This would apply even if the non-Federal
funds were used to match another Federal program.

For example, if a State program offers need-based grants to students
pursuing an information technology field of study, the non-Federal
dollars funding that program would be counted in the SLEAP MOE. Also, in
another example, a State would include in its SLEAP MOE the State funds
spent for LEAP community service work-study jobs.

###### **The Formula Today**

The calculations below occur for the LEAP and SLEAP programs when the
Federal appropriation amount is below \$76,452,287 (FY 1979
"Hold-harmless" Amount):

1\) Derive a percentage of total enrollment of all states:

[State Enrollment Data (1976-1977 Award Year)]{.underline}

Total State Enrollment (for all states)

**= a) % of total enrollment**

2)  Determine what portion of the Federal Appropriation a
    state/territory receives:

a\) % of total enrollment X Federal Appropriation Amount

**= Amount of LEAP/SLEAP Allocation Per State**

The calculations below occur for the SLEAP program amount over
\$46,452,287:

1\) Determine the average grant award per student:

[Final Federal LEAP Allotment + State LEAP Match (for all
states)]{.underline}

Total Number of Recipients that received LEAP (for all states)

**= a) Average grant award per student (for all states)**

2\) Determine the number of students \"deemed eligible per state:

[Final Federal LEAP Allotment + State LEAP Match (per
state)]{.underline}

a)  Average grant award per student (for all states)

**= b) Students deemed eligible (per state)**

3\) Determine what portion of the amount above the \$76,452,287 a
state/territory receives:

[b) Students deemed eligible (per state)]{.underline}

Total \# of students deemed eligible (for all states)

X

Amount of Appropriation Above \$76,452,287

# **= Additional Amount of SLEAP Allocation Per State**

*Note: Final Federal LEAP Allotment and State LEAP Matching dollars are
taken from the latest performance report data on file with the
Department.*

####### Part II: Administering the Leveraging Educational Assistance Partnership (LEAP) Program and its Subprogram Within Your State Today

*The LEAP Program helps your state provide grants to students who
demonstrate substantial financial need, enabling those students to
attend postsecondary school.*

######## PROVIDING FUNDS TO STATES

Under the LEAP Program, the Secretary of Education (the Secretary)
provides states with funds to establish a state grant program assisting
students who demonstrate substantial financial need. The LEAP Program
makes funds available to the 50 states, the District of Columbia, Puerto
Rico, the Virgin Islands, American Samoa, Guam, and the Northern Mariana
Islands. These state programs may carry a variety of names that do not
necessarily include the name "LEAP" in their titles.

Your state must, at a minimum, match LEAP grants dollar for dollar with
funds provided through direct state appropriations.

**MATCHING REQUIREMENTS**

If your state is eligible to participate, it may receive an annual LEAP
allotment (formula grant) from the Department based on your state's
eligible postsecondary education enrollment. The federal allotments must
be matched by funds appropriated by your state, and this matching must
represent an increase in the state-appropriated grant and work-study
expenditure over the amount spent during an established base year
(defined as the second year before your state began participating in the
LEAP Program). Your state must maintain its matching LEAP Program
expenditures at a level not less than the average for the preceding
three fiscal years, or at the level of the average per full-time
equivalent student for those years. LEAP Program expenditures used in
matching the federal allotment must be the net amount of expenditures
and should not include any refunded or returned amounts that were not
actually expended.

***Matching in Auditable Dollar Amounts***

Matching must be in auditable dollar amounts. Tuition waivers or
remissions may be considered grants only if money actually changes hands
from state to school to student, and if this transfer can be documented
as a cash transaction in the records at each level.

**COMMUNITY SERVICE-LEARNING JOB PROGRAM**

Each award year, your state may use up to 20% of its allotment for a
community service-learning job program. The student must receive
compensation for work, not a grant. The job program must be

administered by postsecondary schools in your state, and each student
employed under the program must be employed in work for the public
interest. The employer may be a school; a federal, state, or local
public agency; or a private nonprofit organization. An arrangement must
be established between the school and the agency or organization.

Schools, in consultation with local nonprofit, governmental, and
community-based organizations, identify jobs (in direct service,

planning, or applied research) that are designed to improve the quality
of life for residents (particularly low-income residents) of the

community served. Each community service-learning job must

• provide the participating student with a job related to his or her
educational or vocational program or goals;

• be governed by conditions of employment that are considered
appropriate and reasonable, based on such factors as type of work
performed, geographic region, and proficiency of the employee;

• pay at least the current federal minimum wage as mandated by the Fair
Labor Standards Act of 1938 (not the subminimum wage);

• not displace employed workers or impair existing contracts for
service; and

• not involve the construction, operation, or maintenance of any part of
a facility used or to be used for religious worship or sectarian
instruction.

***Funding Reallotment***

Basic LEAP allotments not used by one state are reallotted to other
qualified states. Within the constraints of federal appropriations, your
state is free to schedule its own funding cycles for students, but funds
may not be carried over from one fiscal year to the next. However, the
funds may be used for the summer term if the term falls within the
program year (July 1 through June 30) for which the funds were
appropriated.

**ADMINISTRATIVE PATTERNS**

Your state may choose different ways to administer its program. It may
choose to use centralized administration, decentralized

administration, or a combination of both. Whichever method is used, your
state must use all federal funds and state matching funds for student

awards. (A state is not permitted to use either federal funds or state
matching funds to help defray administrative costs.)

***Centralized Administration***

Most states, particularly those with well-established state student
assistance programs, use centralized administration. In centralized

administration, a single state agency receives and processes student
applications, notifies students of awards, verifies attendance, makes
disbursements, and keeps complete records on all student awards.

***Decentralized Administration***

In other states, particularly those with relatively new state programs,
the designated state agency delegates certain functions to participating
schools. This is called decentralized administration. In these cases,
funds available through the state agency are generally suballocated to
eligible schools on the basis of enrollment or need formulas. The
schools recommend potential LEAP recipients to the

state agency, which approves individual awards from these fund
allotments. In states that use decentralized administration, funds
awarded under these programs are still considered to be state aid and
not institutional aid.

***Location of Student Files***

In the centrally administered state programs, actual student files are
located in the state agency. In decentralized state administration,
which requires schools to process much of the student information, the
financial aid administrator gives the state agency the information
needed for formal approval of individual student awards. In either

case, to monitor the use of LEAP funds, schools examine student files to
verify that recipients met all eligibility criteria and received the
correct award amount.

**SCHOOL PARTICIPATION**

Within the limits of federal statutes and regulations, your state
determines eligibility standards in terms of its own fiscal,
constitutional, and statutory restraints.

All nonprofit institutions of higher education in your state are
eligible to participate, except when participation violates your state's
constitution or a state law enacted before October 1, 1978. While your
state is not required to include proprietary (for-profit) schools in its
programs, the most recent LEAP participation figures show that at least
half of all states made LEAP awards available to students attending such
schools.

***Other Factors Affecting Participation***

School participation may also be affected when some states suballocate
available LEAP funds to the various types of schools on the basis of
enrollment, need, the availability of non-LEAP aid, and other criteria.
In such instances, money not claimed for student awards at one school
may be reclaimed by the state and reassigned to other

schools.

**STUDENT ELIGIBILITY**

Student eligibility criteria for receiving aid from the LEAP Program
differ among states depending on constitutional, statutory, or policy
restrictions. (Some states have legislated formulas for

determining student eligibility and the amount of assistance given to
individual students.) However, to be eligible for assistance under the
LEAP Program, all students must meet the eligibility requirements and
must demonstrate substantial financial need as determined in accordance
with your state's criteria as approved by the Secretary. The standards
that states may use to determine need are discussed in more detail in
the subsection on Student Application Procedures and Awards beginning on
the next page (page 11).

***General Eligibility Requirements***

The eligibility requirements of Subpart C of the General Provisions
Regulations (34 CFR 668.31-39) are summarized briefly below. In general,
the student must:

• be either a U.S. Citizen or an eligible noncitizen,

• be enrolled as a regular student in an eligible program at an eligible
school,

• have a high school diploma or its recognized equivalent (or be beyond
the age of compulsory school attendance in the state where the school is
located and have passed an independently

administered test approved by the Department),

***Note: Relevant Eligibility Requirements***

***Cite** Subpart C of the General Provisions regulations (34 CFR 668)*

• be maintaining satisfactory academic progress standards in his or her
course of study,

• sign a Statement of Educational Purpose and a Certification Statement
on Overpayments and Default, and

• register with the Selective Service, if required.

A student is not eligible for FSA funds if he or she

• is enrolled in an elementary or secondary school,

• has borrowed in excess of the annual or aggregate limits for the FSA
loan programs, or

• is in default on a student loan or owes an overpayment on a student
grant from the FSA Programs.

If, however, a student owes a refund on a LEAP overpayment, that student
would still be eligible to receive additional FSA funds as long as he or
she meets all other eligibility requirements and as long as the school
can eliminate the overpayment by adjusting financial aid payments (other
than Federal Pell Grants) in the same award period

in which the overpayment occurred.

***Other Factors Determining a Student's Eligibility***

Other factors that determine whether a student is eligible for a LEAP
award include the your state's definition of substantial financial need,
its method of determining maximum awards, and the costs that can be
covered. Some states limit awards to cover only the cost for tuition and
fees; some states include allowances for room, board, and other costs.
Some have allowances for commuters. Many state grant programs exclude
part-time students and those who attend schools outside the

state. Some states have reciprocal arrangements with neighboring states,
so that students may receive LEAP funds from their home states

even though the students are enrolled in schools in other states. LEAP
funds may be awarded to students participating in programs of study

abroad that are approved for credit by the home school.

***Independent or Less-Than-Full-Time Students***

Your state's LEAP independent student program funding should be
comparable to the overall state program if the entire state program is
not contained in your state's LEAP Program. To the extent practicable,
the proportion of LEAP funds awarded to independent students in the LEAP
Program must be the same proportion of funds awarded to independent
students in your state program (or programs) of which your state's LEAP
Program is a part.

If your state awards grants to independent or less-than-full-time
students, it must allocate a reasonable portion of funds for these
awards. The Secretary will determine if the allocation is reasonable on
a case-by-case basis, if necessary.

If your state's allocation is based on a formula that includes the
financial need of independent or less-than-full-time students, your
state must ensure that those students receive a reasonable proportion of
LEAP funds.

**STUDENT APPLICATION PROCEDURES AND AWARDS**

The student must apply to his or her state agency either directly or
indirectly through the school. Every award requires the official state
agency's formal approval, based on a determination of need.

***Maximum Award***

The maximum award that a student may receive is \$5,000 per academic
year. The maximum award is reduced proportionately for students who
attend part-time. Many states set maximum awards under

\$5,000.

Most states limit LEAP awards to undergraduates attending at least
half-time. However, at your state's option, graduate,
less-than-half-time,

and other nontraditional students may also be eligible to receive LEAP
awards. Your state may decide whether to make individual LEAP awards

that vary according to student need or to give a set amount to all
students who meet the established need criteria.

***Determining Substantial Financial Need***

Student recipients are selected annually on the basis of substantial
financial need, according to criteria established by your state and
approved by the Department. Your state may define need in terms of
income, Expected Family Contribution (EFC), or relative need, as
measured by cost of attendance minus available resources.

***Need Analysis Systems***

Most states measure need by using a single need analysis system for all
applicants (the Federal Needs Analysis Methodology). However, in

decentralized programs---where schools recommend student candidates for
awards subject to the designated state agency's approval---student
applications may be processed according to the need analysis systems
used by the schools. In any event, the designated agency within your
state has final authority for selecting recipients who meet the need
criteria under standards established for the statewide program.

***Dependency Criteria***

A dependent student who applies for aid from any of the FSA Programs
must include parental information on the application. An independent
student need only include his or her financial

information (and, if married, that of a spouse).

The Department may approve, on a case-by-case basis, a state's criteria
if they vary from those listed under the *Student Eligibility rules*.
The state must show that it had good reason to use different

criteria. This option to approve different criteria began in the 1995-96
award year.

***Alternative Criteria for Determining Dependency Status***

States that wish to use variant definitions for "independent student"
must provide information concerning their definition when applying for
program funds. The information should include a

justification, with accompanying supporting documentation, showing why a
variant definition should be approved. For example, your state may

want to use its own definition because it may incur excessive costs if
required to use the federal definition.

In approving a state's "independent student" definition, the Department
might also consider the extent to which the new definition imposes
additional data requirements beyond those provided for by the federal
definition and the Federal Needs Analysis Methodology.

A state's definition might not differ totally from the federal
definition. For example, your state might use the federal definition but
might delete the professional judgment provision.

***Cost of Applying***

To award a student aid, your state may require the student to provide
applicant information on the Free Application for Federal Student Aid
(FAFSA) or on another free form. In addition, your state may require a
student to provide supplemental information on a fee-based supplemental
form. If there is a fee for submitting and processing state information
on the supplemental form, the fee must be payable to your state,
regardless of whether the information may also be used for institutional
aid. Decentralized state grant programs (under which schools
participating in the state LEAP programs award state grant funds) must
consider state grant funds as state aid and not institutional aid.

**FISCAL AND REPORTING RELATIONSHIPS BETWEEN**

**SCHOOLS AND YOUR STATE AGENCY**

State agencies responsible for administering LEAP funds must document
their decisions and disbursements in their own central records, in
school records, or in both. Variations of student/school rosters are
often sent back and forth between the state agency and the schools to
verify attendance, provide information related to student need, document
disbursement of funds to students or to student accounts, guard against
overawards, and help provide required records

and reports.

In general, fiscal and reporting relationships between participating
schools and the state agencies vary according to whether the states'

programs are administered in a centralized or decentralized manner, or
in a combined manner. In any case, your state agency must be held
accountable for the disbursement of federal funds and for making the
required reports to the Department. States are given considerable leeway
in demonstrating fiscal responsibility related to administration of the
LEAP Program. However, participating schools must meet the federal
standards of fiscal responsibility described under the *Institutional
Eligibility rules.*

At a minimum, even schools using the most centralized administration
must:

• assure that students will meet satisfactory academic standards,

• document the status of grant refunds, and

• document the status of loan defaults.

A school must also document student acknowledgment of awards if funds
are paid to the school on behalf of the recipient; furthermore, the
school must cooperate in packaging aid to avoid overawards.

In decentralized systems (in which the state agency depends on the
school to help screen applicants) school records must document need

analysis documentation to justify formal approval of individual awards
by your state agency.

Individual student awards are subject to approval by your state's
designated educational agency. Schools may not transfer awards from one
student to another without that agency's approval. Schools and state
agencies should maintain regular communication so that any funds that
become available later in the year will be used for qualified students.

The state agency may need to require certain school reports to document
the disbursement of federal funds to student recipients. The school
reports might also provide information needed to improve efficiency in
the operation of your state programs and to provide data for its budgets
and for annual reports to the Department.

***Recovered Funds Must be Redistributed***

All funds (federal plus state) recovered from overawards should be
redistributed to other qualified students during the applicable award

period unless records for the period have been closed. If these funds
are not reissued to qualified students, your state must return the
recovered federal portion to the Department.

***School Reports Must Document Fund Disbursement***

The actual form and content of school reports vary from state to state,
depending upon the size and maturity of the state programs, among other
factors. There are no standard formats or channels for these school
reports. For example, information about recipients by income level may
come either from the central office records or from the schools.
Communication may follow established procedures or may be developed
through cooperative efforts of your state and school representatives.

**SPECIAL LEVERAGING EDUCATIONAL ASSISTANCE**

**PARTNERSHIP (SLEAP) PROGRAM**

The SLEAP Program is an additional component of the LEAP Program. To
participate in the SLEAP Program, your state must also participate in
the LEAP Program. Also, the SLEAP Program must be administered by the
same state educational agency that administers its LEAP Program. That
agency would have to submit all required SLEAP Program reports. This
includes a SLEAP application and an annual performance report. The LEAP
and SLEAP programs are funded under one appropriation. The initial \$30
million of the appropriation funds the LEAP Program. Any amount in
excess of the initial \$30 million must be used to carry out activities
authorized under the SLEAP Program. For example, the funding for the
2003-2004 award year is \$67 million for both programs; therefore, there
is \$37 million for the SLEAP component for the 2003-2004 award year.

The SLEAP Program provides incentive grants to assist states in
providing financial assistance to eligible needy postsecondary students.
Guidance was issued to your state to help administer

the SLEAP Program during the 2001-2002 award year. This guidance, posted
March 29, 2001 (see previous Part I, page 4 of this handbook) is still
applicable.

***Authorized SLEAP Activities***

There are three authorized SLEAP activities. Under the SLEAP Program,
your state may:

• 1) Supplement LEAP grant awards by increasing LEAP Program grant award
amounts for students, or by increasing the number of LEAP Program grant
recipients. The \$5,000 maximum LEAP award limit does not apply to the
SLEAP funds spent for this purpose. This grant supplement may consist of
Federal SLEAP funds or SLEAP matching non-Federal funds, or both, and is
accounted for and reported under SLEAP and not LEAP.

• 2) Supplement LEAP community service work-study awards by increasing
LEAP Program community service work-study award amounts for students, or
by increasing the number of LEAP

Program community-service work-study recipients. The \$5,000 maximum
LEAP award limit and the 20% cap on using Federal LEAP funds for
community service work-study awards does not apply to the SLEAP funds
spent for this purpose. This community service work-study award
supplement may consist of Federal SLEAP funds or SLEAP matching funds,
or both, and is accounted for and reported under SLEAP and not LEAP.

-   And 3) Award scholarships to eligible students for merit and
    academic achievement can be awarded to eligible students pursuing
    any field of study. Critical career scholarships can be awarded to
    eligible students who desire to enter careers in information
    technology, mathematics, computer science, or engineering, teaching,
    or other fields determined by your state to be critical to its
    workforce needs.

Your state may select one or more of the above activities under the
SLEAP Program. Your state is prohibited from using SLEAP funds to pay
any administrative costs.

### **Matching Requirements**

For every Federal (SLEAP) dollar your state spends, it must spend at
least two dollars from nonfederal funds. It may use any non-Federal
funds that are spent for any of the authorized activities, as long as
those funds are not also being used to match other Federal programs.
Non-Federal funds include, but are not limited to, State-appropriated
funds or privately-donated funds. Also, the matching non-Federal funds
must meet the special rule to qualify as your state's matching share of
the SLEAP Program funds.

To qualify as matching funds for the SLEAP Program, the nonfederal funds
must represent dollars that are in excess of the total dollars that your
state spent for need-based grants, *need-based* scholarships, and
*need-based* work-study assistance in the [1999-2000]{.underline} award
year. The total dollars expended by your state in the 1999-2000 award
year must include all the funds your state reported as part of its LEAP
Program. The purpose of this special rule is to ensure that the SLEAP
Program generates new funds from your state beyond the amount it spent
in the 1999-2000 award year for these kinds of assistance before the
start of the SLEAP Program (2000-2001 award year.)

The matching requirement under the SLEAP Program is an aggregate
matching requirement for the authorized activities. Therefore, your
state may use the nonfederal funds for one authorized activity and use
the federal funds for a different SLEAP activity. The non-federal funds
that are used as a match for SLEAP may come from a state program that
also contains some LEAP Program funds (federal and state), if all the
following conditions are met:

-   The non-Federal funds are not reported as part of your state's LEAP
    Program for the same award year. The fact that part of your state's
    program is reported as LEAP matching funds does not prevent your
    state from using the part of the program that is not reported as
    LEAP matching funds as SLEAP matching funds.

-   The non-federal funds are not being used as a match for any other
    federally-funded program

-   The non-federal funds are used to do one or more of the authorized
    SLEAP activities.

***SLEAP Maintenance - of - Effort***

Under the SLEAP Program, your state must assure that its expenditures
for the authorized activities, in the aggregate or per student, in the
preceding award year were not less than its expenditures for those
activities, in the aggregate or per student, in the second preceding
award year.

In other words, the SLEAP MOE (maintenance of effort) for the 2003-2004
award year requires that your state's expenditures from non-federal
funds for the three SLEAP authorized postsecondary activities, in the
aggregate or per student, in the 2002-2003 award year must not be less
than its expenditures for those same three activities, in the aggregate
or per student, in the 2001-2002 award year. See those three activities
under the heading "Authorized SLEAP Activities" on the previous page.

**34 CFR Education**

**Subtitle B**

**CHAPTER VI**

**OFFICE OF POSTSECONDARY EDUCATION**

**DEPARTMENT OF EDUCATION**

#### PART 692 \-- LEVERAGING EDUCATIONAL ASSISTANCE PARTNERSHIP PROGRAM

##### Subpart A \-- Leveraging Educational Assistance Partnership Program

##### GENERAL

**Sec.**\
[692.1](http://ecfr1.access.gpo.gov/otcgi/cfr/#Sec. 692.1)   What is the
Leveraging Educational Assistance Partnership?\
[692.2](http://ecfr1.access.gpo.gov/otcgi/cfr/#Sec. 692.2)   Who is
eligible to participate in the LEAP Program?\
[692.3](http://ecfr1.access.gpo.gov/otcgi/cfr/#Sec. 692.3)   What
regulations apply to the LEAP Program?\
[692.4](http://ecfr1.access.gpo.gov/otcgi/cfr/#Sec. 692.4)   What
definitions apply to the LEAP Program?

##### WHAT IS THE AMOUNT OF ASSISTANCE AND HOW MAY IT BE USED?

[692.10](http://ecfr1.access.gpo.gov/otcgi/cfr/#Sec. 692.10)   How does
the Secretary allot funds to the States?\
[692.11](http://ecfr1.access.gpo.gov/otcgi/cfr/#Sec. 692.11)   For what
purposes may a State use its payments under the LEAP Program?

##### HOW DOES A STATE APPLY TO PARTICIPATE IN THE LEAP PROGRAM?

[692.20](http://ecfr1.access.gpo.gov/otcgi/cfr/#Sec. 692.20)   What must
a State do to receive an allotment under this program?\
[692.21](http://ecfr1.access.gpo.gov/otcgi/cfr/#Sec. 692.21)   What
requirements must be met by a State program?

##### HOW DOES A STATE ADMINISTER ITS COMMUNITY SERVICE-LEARNING JOB PROGRAM?

[692.30](http://ecfr1.access.gpo.gov/otcgi/cfr/#Sec. 692.30)   How does
a State administer its community service-learning job program?

##### HOW DOES A STATE SELECT STUDENTS UNDER THE LEAP PROGRAM?

[692.40](http://ecfr1.access.gpo.gov/otcgi/cfr/#Sec. 692.40)   What are
the requirements for student eligibility?\
[692.41](http://ecfr1.access.gpo.gov/otcgi/cfr/#Sec. 692.41)   What
standards may a State use to determine substantial financial need?

##### Subpart B \-- Special Leveraging Educational Assistance Partnership Program

##### GENERAL

[692.50](http://ecfr1.access.gpo.gov/otcgi/cfr/#Sec. 692.50)   What is
the Special Leveraging Educational Assistance Partnership Program?\
[692.51](http://ecfr1.access.gpo.gov/otcgi/cfr/#Sec. 692.51)   What
other regulations apply to the SLEAP Program?\
[692.52](http://ecfr1.access.gpo.gov/otcgi/cfr/#Sec. 692.52)   What
definitions apply to the SLEAP Program?\
[692.53](http://ecfr1.access.gpo.gov/otcgi/cfr/#Sec. 692.53)   What
requirements must a State satisfy to receive SLEAP Program funds?\
[692.54](http://ecfr1.access.gpo.gov/otcgi/cfr/#Sec. 692.54)   What
eligibility requirements must a student satisfy to participate in the
SLEAP Program?

##### HOW DOES A STATE APPLY TO PARTICIPATE IN THE SLEAP PROGRAM?

[692.60](http://ecfr1.access.gpo.gov/otcgi/cfr/#Sec. 692.60)   What must
a State do to receive an allotment under the SLEAP Program?

##### WHAT IS THE AMOUNT OF ASSISTANCE AND HOW MAY IT BE USED?

[692.70](http://ecfr1.access.gpo.gov/otcgi/cfr/#Sec. 692.70)   How does
the Secretary allot funds to the States?\
[692.71](http://ecfr1.access.gpo.gov/otcgi/cfr/#Sec. 692.71)   What
activities may be funded under the SLEAP Program?\
[692.72](http://ecfr1.access.gpo.gov/otcgi/cfr/#Sec. 692.72)   May a
State use the funds it receives under the SLEAP Program to pay
administrative costs?

##### HOW DOES A STATE ADMINISTER ITS COMMUNITY SERVICE WORK-STUDY PROGRAM?

[692.80](http://ecfr1.access.gpo.gov/otcgi/cfr/#Sec. 692.80)   How does
a State administer its community service work-study program?

**Authority:** 20 U.S.C 1070c through 1070c-4, unless otherwise noted.

**Source:** 52 FR 45433, Nov. 27, 1987, unless otherwise noted.

#### Subpart A \-- Leveraging Educational Assistance Partnership Program

**General**

**§692.1  ** **What is the Leveraging Educational Assistance
Partnership?**

The Leveraging Educational Assistance Partnership (LEAP) Program assists
States in providing grants and work-study assistance to eligible
students who attend institutions of higher education and have
substantial financial need. The work-study assistance is provided
through campus-based community service work learning study programs,
hereinafter referred to as community service-learning job programs.
(Authority: 20 U.S.C. 1070c-1070c-4)

\[52 FR 45433, Nov. 27, 1987, as amended at 65 FR 38729, June 22,
2000\]\
\
**§692.2  ** **Who is eligible to participate in the LEAP Program?**

\(a\) *State participation.* A State that meets the requirements in
§§692.20 and 692.21 is eligible to receive payments under the LEAP
program.

\(b\) *Student participation.* A student must meet the requirements of
§692.40 to be eligible to receive assistance from a State under the LEAP
program. (Authority: 20 U.S.C. 1070c-1)

\[52 FR 45433, Nov. 27, 1987, as amended at 65 FR 38729, June 22, 2000\]

**§692.3  ** **What regulations apply to the LEAP Program?**

The following regulations apply to the LEAP Program:

\(a\) The regulations in this part 692.

\(b\) The Education Department General Administrative Regulations
(EDGAR) as follows:

\(1\) 34 CFR 75.60-75.62 (Ineligibility of Certain Individuals to
Receive Assistance).

\(2\) 34 CFR part 76 (State-Administered Programs).

\(3\) 34 CFR part 77 (Definitions That Apply to Department Regulations).

\(4\) 34 CFR part 79 (Intergovernmental Review of Department of
Education Programs and Activities).

\(5\) 34 CFR part 80 (Uniform Administrative Requirements for Grants and
Cooperative Agreements to State and Local Governments).

\(6\) 34 CFR part 82 (New Restrictions on Lobbying).

\(7\) 34 CFR part 85 (Governmentwide Debarment and Suspension
(Nonprocurement) and Governmentwide Requirements for Drug-Free Workplace
(Grants)).

\(8\) 34 CFR part 86 (Drug and Alcohol Abuse Prevention).

\(c\) The Student Assistance General Provisions in 34 CFR part 668.
(Authority: 20 U.S.C. 1070c-1070c-4)

\[52 FR 45433, Nov. 27, 1987, as amended at 55 FR 21716, May 25, 1990;
59 FR 4223, Jan. 28, 1994; 65 FR 38729, June 22, 2000\]\
\
**§692.4   ** **What definitions apply to the LEAP Program?**

The following definitions apply to the regulations in this part:

\(a\) The definitions of the following terms under 34 CFR part 600:

Postsecondary vocational institution (§600.6).

Public or private nonprofit institution of higher education (§600.4).

Secretary (§600.2).

State (§600.2).

\(b\) The definitions of the following terms under 34 CFR part 668:

Academic year (§668.2).

Enrolled (§668.2).

HEA (§668.2).

Institution (§668.1(b)).

\(c\) The definitions of the following terms also apply to the LEAP
Program:

*Full-time student* means a student carrying a full-time academic
workload \-- other than by correspondence \-- as measured by both of the
following:

\(1\) Coursework or other required activities, as determined by the
institution that the student attends or by the State.

\(2\) The tuition and fees normally charged for full-time study by that
institution.

*Nonprofit* has the same meaning under this part as the same term
defined in 34 CFR 77.1 of EDGAR. (Authority: 20 U.S.C. 1070c-1070c-4)

\[52 FR 45433, Nov. 27, 1987, as amended at 59 FR 4223, Jan. 28, 1994;
65 FR 38729, June 22, 2000\]

**What Is the Amount of Assistance and How May It Be Used?**

**§692.10  ** **How does the Secretary allot funds to the States?**

(a)(1) The Secretary allots to each State participating in the LEAP
program an amount which bears the same ratio to the Federal LEAP funds
appropriated as the number of students in that State who are \"deemed
eligible\" to participate in the State\'s LEAP program bears to the
total number of students in all States who are \"deemed eligible\" to
participate in the LEAP program, except that no State may receive less
than it received in fiscal year 1979.

\(2\) If the Federal LEAP funds appropriated for a fiscal year are not
sufficient to allot to each State the amount of Federal LEAP funds it
received in fiscal year 1979, the Secretary allots to each State an
amount which bears the same ratio to the amount of Federal LEAP funds
appropriated as the amount of Federal LEAP funds that State received in
fiscal year 1979 bears to the amount of Federal LEAP funds all States
received in fiscal year 1979.

\(b\) For the purpose of paragraph (a)(1) of this section, the Secretary
determines the number of students \"deemed eligible\" to participate in
a State\'s LEAP Program by dividing the amount of that State\'s LEAP
expenditures, including both its Federal allotment and the
State-appropriated funds matching the allotment, by the average grant
award per student of all participating States. The Secretary determines
the \"average grant award per student\" by dividing the total number of
student recipients for all States into the total amount of LEAP
expenditures for all States, including both the Federal allotments and
the State-appropriated funds matching those allotments. In making this
determination, the Secretary uses the most current available data
reported by each State. (Authority: 20 U.S.C. 1070c)

\[52 FR 45433, Nov. 27, 1987, as amended at 59 FR 4223, Jan. 28, 1994;
65 FR 38730, June 22, 2000\]\
\
**§692.11  ** **For what purposes may a State use its payments under the
LEAP Program?**

A State may use the funds it receives under the LEAP Program only to
make grants to students and to pay wages or salaries to students in
community service-learning jobs. (Authority: 20 U.S.C. 1070c)

\[52 FR 45433, Nov. 27, 1987, as amended at 65 FR 38730, June 22, 2000\]

**How Does a State Apply To Participate in The LEAP Program?**

**§692.20  ** **What must a State do to receive an allotment under this
program?**

\(a\) For each fiscal year that it wishes to participate, a State shall
submit an application that contains information that shows that its
Leveraging Educational Assistance Partnership Program meets the
requirements of §692.21.

(b)(1) Except as provided in paragraph (b)(2) of this section, the State
must submit its application through the State agency designated to
administer its Leveraging Educational Assistance Partnership Program as
of July 1, 1985.

\(2\) If the Governor of the State so designates, and notifies the
Secretary in writing, the State may submit its application under
paragraph (a) of this section through an agency that did not administer
its Leveraging Educational Assistance Partnership Program as of July 1,
1985. (Authority: 20 U.S.C. 1070c-2(a))

\[52 FR 45433, Nov. 27, 1987, as amended at 65 FR 38730, June 22,
2000\]\
\
**§692.21  ** **What requirements must be met by a State program?**

To receive a payment under the LEAP Program for any fiscal year, a State
must have a program that \--

\(a\) Is administered by a single State agency;

\(b\) Provides assistance only to students who meet the eligibility
requirements in §692.40;

\(c\) Provides that assistance under this program to a full-time student
will not be more than \$5,000 for each academic year;

\(d\) Provides for the selection of students to receive assistance on
the basis of substantial financial need determined annually by the State
on the basis of standards that the State establishes and the Secretary
approves;\
**Cross-Reference:** See §692.41.

\(e\) Provides that no student or parent shall be charged a fee that is
payable to an organization other than the State for the purpose of
collecting data to make a determination of financial need in accordance
with paragraph (d) of this section;

\(f\) Provides that all public or private nonprofit institutions of
higher education and all postsecondary vocational institutions in the
State are eligible to participate unless that participation is in
violation of \--

\(1\) The constitution of the State; or

\(2\) A State statute that was enacted before October 1, 1978;

\(g\) Provides that, if a State awards grants to independent students or
to students who are less-than-full-time students enrolled in an
institution, a reasonable portion of the State\'s allocation must be
awarded to those students;

\(h\) Provides that \--

\(1\) The State will pay an amount for grants and work-study jobs under
this part for each fiscal year that is not less than the payment to the
State under this part for that fiscal year; and

\(2\) The amount that the State expends during a fiscal year for grants
and work-study jobs under the LEAP Program represents an additional
amount for grants and work-study jobs for students attending
institutions over the amount expended by the State for those activities
during the fiscal year two years prior to the fiscal year in which the
State first received funds under the LEAP Program;

\(i\) Provides for State expenditures under the State program of an
amount that is not less than \--

\(1\) The average annual aggregate expenditures for the preceding three
fiscal years; or

\(2\) The average annual expenditure per full-time equivalent student
for those years;

\(j\) Provides that, to the extent practicable, the proportion of the
funds awarded to independent students in the LEAP Program shall be the
same proportion of funds awarded to independent students as is in the
State program or programs of which the State\'s LEAP Program is a part;
and

\(k\) Provides for reports to the Secretary that are necessary to carry
out the Secretary\'s functions under the LEAP Program. (Authority: 20
U.S.C. 1070c-2)

\[52 FR 45433, Nov. 27, 1987, as amended at 59 FR 4223, Jan. 28, 1994;
65 FR 38730, June 22, 2000\]

**How Does a State Administer Its Community Service-Learning Job
Program?**

**§692.30  ** **How does a State administer its community
service-learning job program?**

(a)(1) Each year, a State may use up to 20 percent of its allotment for
a community service-learning job program that satisfies the conditions
set forth in paragraph (b) of this section.

\(2\) A student who receives assistance under this section must receive
compensation for work and not a grant.

(b)(1) The community service-learning job program must be administered
by institutions in the State.

\(2\) Each student employed under the program must be employed in work
in the public interest by an institution itself or by a Federal, State,
or local public agency or a private nonprofit organization under an
arrangement between the institution and the agency or organization.

\(c\) Each community service-learning job must \--

\(1\) Provide community service as described in paragraph (d) of this
section;

\(2\) Provide participating students community service-learning
opportunities related to their educational or vocational programs or
goals;

\(3\) Not result in the displacement of employed workers or impair
existing contracts for services;

\(4\) Be governed by conditions of employment that are considered
appropriate and reasonable, based on such factors as type of work
performed, geographical region, and proficiency of the employee;

\(5\) Not involve the construction, operation, or maintenance of any
part of a facility used or to be used for religious worship or sectarian
instruction; and

\(6\) Not pay any wage to a student that is less than the current
Federal minimum wage as mandated by section 6(a) of the Fair Labor
Standards Act of 1938.

\(d\) For the purpose of paragraph (c)(1) of this section, \"community
service\" means direct service, planning, or applied research that is
\--

\(1\) Identified by an institution through formal or informal
consultation with local nonprofit, governmental, and community-based
organizations; and

\(2\) Designed to improve the quality of life for residents of the
community served, particularly low-income residents, in such fields as
health care, child care, education, literacy training, welfare, social
services, public safety, crime prevention and control, transportation,
recreation, housing and neighborhood improvement, rural development, and
community improvement.

\(e\) For the purpose of paragraph (d)(2) of this section, \"low-income
residents\" means \--

\(1\) Residents whose taxable family income for the year before the year
in which they are scheduled to receive assistance under the LEAP Program
did not exceed 150 percent of the amount equal to the poverty level
determined by using criteria of poverty established by the United States
Census Bureau; or

\(2\) Residents who are considered low-income residents by the State.
(Authority: 20 U.S.C. 1070c-2, 1070-4)

\[52 FR 45433, Nov. 27, 1987, as amended at 59 FR 4223, Jan. 28, 1994;
65 FR 38730, June 22, 2000\]

**How Does a State Select Students Under the LEAP Program?**

**§692.40  ** **What are the requirements for student eligibility?**

To be eligible for assistance, a student must \--

\(a\) Meet the relevant eligibility requirements contained in 34 CFR
668.32; and

\(b\) Have substantial financial need as determined annually in
accordance with the State\'s criteria approved by the Secretary.
(Authority: 20 U.S.C. 1070c-2, 1091)

\[52 FR 45433, Nov. 27, 1987, as amended at 65 FR 38730, June 22, 2000\]

**§692.41  ** **What standards may a State use to determine substantial
financial need?**

\(a\) A State determines whether a student has substantial financial
need on the basis of criteria it establishes that are approved by the
Secretary. A State may define substantial financial need in terms of
family income, expected family contribution, and relative need as
measured by the difference between the student\'s cost of attendance and
the resources available to meet that cost. To determine substantial
need, the State may use \--

\(1\) A system for determining a student\'s financial need under part F
of title IV of the HEA;

\(2\) The State\'s own needs analysis system if approved by the
Secretary; or

\(3\) A combination of these systems, if approved by the Secretary.

\(b\) The Secretary generally approves a need-analysis system under
paragraph (a) (2) or (3) of this section only if the need-analysis
system applies the term \"independent student\" as defined under section
480(d) of the HEA. However, for good cause shown, the Secretary may
approve, on a case-by-case basis, a State\'s need analysis system that
uses a definition for \"independent student\" that varies from that term
as defined in section 480(d) of the HEA. (Authority: 20 U.S.C. 1070c-2)

\[52 FR 45433, Nov. 27, 1987, as amended at 59 FR 4223, Jan. 28, 1994\]

#### Subpart B \-- Special Leveraging Educational Assistance Partnership Program

**Source:** [65 FR
65608](http://frwebgate.access.gpo.gov/cgi-bin/getpage.cgi?dbname=2000_register&page=65608&position=all),
Nov. 1, 2000, unless otherwise noted.

**General**

**§692.50   ** **What is the Special Leveraging Educational Assistance
Partnership Program?**

The Special Leveraging Educational Assistance Partnership (SLEAP)
Program assists States in providing grants, scholarships, and community
service work-study assistance to eligible students who attend
institutions of higher education and demonstrate financial need.
(Authority: 20 U.S.C. 1070c-3a)

\[66 FR 34039, June 26, 2001\]\
\
**§692.51   ** **What other regulations apply to the SLEAP Program?**

The regulations listed in §692.3 also apply to the SLEAP Program.
(Authority: 20 U.S.C. 1070c-3a)

**§692.52   ** **What definitions apply to the SLEAP Program?**

The definitions listed in §692.4 apply to the SLEAP Program. (Authority:
20 U.S.C. 1070c-3a)

\[66 FR 34039, June 26, 2001\]\
\
**§692.53   ** **What requirements must a State satisfy to receive SLEAP
Program funds?**

To receive SLEAP Program funds for any fiscal year, a State must \--

\(a\) Participate in the LEAP Program;

\(b\) Meet the requirements in §692.60; and

\(c\) Have a program that satisfies the requirements in §692.21(a), (b),
(d), (e), (f), (g), (j), and (k). (Authority: 20 U.S.C. 1070c-3a)

\[65 FR 65608, Nov. 1, 2000, as amended at 66 FR 34039, June 26, 2001\]\
\
**§692.54   ** **What eligibility requirements must a student satisfy to
participate in the SLEAP Program?**

To receive assistance under the SLEAP Program, a student must meet the
eligibility requirements contained in §692.40. (Authority: 20 U.S.C.
1070c-3a)

\[66 FR 34039, June 26, 2001\]

**How Does a State Apply To Participate in the SLEAP Program?**

**§692.60   ** **What must a State do to receive an allotment under the
SLEAP Program?**

To receive an allotment under the SLEAP Program, a State must \--

\(a\) Submit an application in accordance with the provisions in
§692.20;

\(b\) Identify the activities in §692.71 for which it plans to use the
SLEAP Federal and non-Federal funds;

\(c\) Ensure that the non-Federal funds used as matching funds represent
dollars that are in excess of the total dollars that a State spent for
need-based grants, scholarships, and work-study assistance for fiscal
year 1999, including the State funds reported as part of its LEAP
Program;

\(d\) Provide an assurance that for the fiscal year prior to the fiscal
year for which the State is requesting Federal funds, the amount the
State expended from non-Federal sources per student, or the aggregate
amount the State expended, for all the authorized activities in §692.71
will be no less than the amount the State expended from non-Federal
sources per student, or in the aggregate, for those activities for the
second fiscal year prior to the fiscal year for which the State is
requesting Federal funds; and

\(e\) Ensure that the Federal share will not exceed one-third of the
total funds expended under the SLEAP Program. (Authority: 20 U.S.C.
1070c-3a)

\[65 FR 65608, Nov. 1, 2000, as amended at 66 FR 34039, June 26, 2001\]

**What Is the Amount of Assistance and How May It Be Used?**

**§692.70   ** **How does the Secretary allot funds to the States?**

For each fiscal year, the Secretary allots to each eligible State that
applies for SLEAP funds an amount in accordance with the provisions in
§692.10. (Authority: 20 U.S.C. 1070c-3a)

**§692.71   ** **What activities may be funded under the SLEAP
Program?**

A State may use the funds it receives under the SLEAP Program for one or
more of the following activities:

\(a\) Supplement LEAP grant awards to eligible students who demonstrate
financial need by \--

\(1\) Increasing the LEAP grant award amounts for students; or

\(2\) Increasing the number of students receiving LEAP grant awards.

\(b\) Supplement LEAP community service work-study awards to eligible
students who demonstrate financial need by \--

\(1\) Increasing the LEAP community service work-study award amounts for
students; or

\(2\) Increasing the number of students receiving LEAP community service
work-study awards.

\(c\) Award scholarships to eligible students who demonstrate financial
need and who \--

\(1\) Demonstrate merit or academic achievement; or

\(2\) Wish to enter a program of study leading to a career in \--

\(i\) Information technology;

\(ii\) Mathematics, computer science, or engineering;

\(iii\) Teaching; or

\(iv\) Other fields determined by the State to be critical to the
State\'s workforce needs. (Authority: 20 U.S.C. 1070c-3a)

\[66 FR 34039, June 26, 2001\]

**§692.72   ** **May a State use the funds it receives under the SLEAP
Program to pay administrative costs?**

A State may not use any of the funds it receives under the SLEAP Program
to pay any administrative costs. (Authority: 20 U.S.C. 1070c-3a)

\[66 FR 34040, June 26, 2001\]

**How Does a State Administer Its Community Service Work-Study
Program?**

**§692.80   ** **How does a State administer its community service
work-study program?**

When administering its community service work-study program, a State
must follow the provisions in §692.30, other than the provisions of
paragraph (a)(1) of that section. (Authority: 20 U.S.C. 1070c-3a)

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**Application To**

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