**Minutes GA/ED GAFR Workgroup**

####### June 4 -- 5, 2003

# Meeting Minutes

**Agenda:** 1. Update -- LPIF Rate Change for FY 2004

2.  Update on GAFR Enhancements

3.  Overview of Federal Receivable Calculation vs. MR-32

4.  Review GAFR Revised Instruction Guide

5.  NSLDS vs. GAFR Reasonability

**Location:** Union Center Plaza (UPC)

830 First Street, N.E.

Washington, DC

**Date and Time:** June 4-5, 2003

June 4^th^ 10:30am --4:00pm (UPC, Room 112B1)

June 5^th^ 8:30 a.m. -- 12 noon (UPC, 1^st^ Floor, Learning Center)

# GA Members Present:

  -------------- ------------------------------------- ---------------------------
  Diana Tiefel   United Student Aid Funds, Inc.        <dtiefel@usafunds.org>

  Carolina Rand  Montana Guaranteed Student Loan       <crand@mgslp.state.mt.us>
                 Program                               

  Jill Hicks     Nebraska Student Loan Program         <jillh@nslp.org>

  Kathleen       Pennsylvania Higher Education         <kwitten@pheaa.org>
  Witten         Assistance Auth.                      

  Jody Beaston   Pennsylvania Higher Education         <jbeaston@pheaa.org>
                 Assistance Auth.                      

  Kay Morgan     Texas Guaranteed Student Loan         <Kay.morgan@tgslc.org>
                 Corporation                           

  Kim Walker     Sallie Mae Servicing                  <kwalker@salliemae.com>

  Tim Cameron    NCHELP                                <tcameron@nchelp.org>
  -------------- ------------------------------------- ---------------------------

**ED Members Present:**

+------------+----------+---------------------+-----------------------+
| Kristie    | 202-     | GM, Financial       | [Kristi               |
| Hansen     | 377-3301 | Partner Channel     | e.Hansen@ed.gov](../K |
|            |          |                     | ristie.Hansen@ed.gov) |
+------------+----------+---------------------+-----------------------+
| Pam        | 202-     | NSLDS               | Pam.<Eliadis@ed.gov>  |
| Eliadis    | 377-3554 |                     |                       |
+------------+----------+---------------------+-----------------------+
| Valerie    | 202-     | NSLDS               | Valerie               |
| Sherrer    | 377-3547 |                     | Sherrer@ed.gov        |
+------------+----------+---------------------+-----------------------+
| Ron        | 703-     | NSLDS-Raytheon      | Ron                   |
| Bennett    | 560-5000 |                     | _Bennett@raytheon.com |
+------------+----------+---------------------+-----------------------+
| Judy       | 703-     | NSLDS-Raytheon      | Jmartin@raytheon.com  |
| Martin     | 560-5000 |                     |                       |
+------------+----------+---------------------+-----------------------+
| Mohammed   | 703-     | NSLDS-Raytheon      | #### Mohamme          |
| Loya       | 560-5000 |                     | d_H_Loya@raytheon.com |
+------------+----------+---------------------+-----------------------+
| Lee Avery  | 617-     | Partner Services    | Lee Avery@ed.gov      |
|            | 223-9335 |                     |                       |
+------------+----------+---------------------+-----------------------+
| Katrina    | 202-     | Partner Services    | Katrina Turner@ed.gov |
| Turner     | 377-3311 |                     |                       |
+------------+----------+---------------------+-----------------------+
| Nettie     | 202-     | Partner Services    | Nettie Harding@ed.gov |
| Harding    | 377-3307 |                     |                       |
+------------+----------+---------------------+-----------------------+
| Peter      | 202-     | FSA-CFO, Accounting | <Peter.Basso@ed.gov>  |
| Basso      | 377-3412 |                     |                       |
+------------+----------+---------------------+-----------------------+
| William    | 202-     | FSA-CFO, Accounting | William.Marks@ed.gov  |
| Marks      | 377-3424 |                     |                       |
+------------+----------+---------------------+-----------------------+
| Frank      | 202-     | Financial           | <Frank.Ramos@ed.gov>  |
| Ramos      | 377-3330 | Management          |                       |
|            |          | Division/FP         |                       |
+------------+----------+---------------------+-----------------------+
| Barbara    | 202-     | FMD/FP              | BJ.Johnson@ed.gov     |
| Johnson    | 377-3327 |                     |                       |
+------------+----------+---------------------+-----------------------+
| Sandra     | 202-     | FMD/FP              | Sandra.Simmons@ed.gov |
| Simmons    | 377-3332 |                     |                       |
+------------+----------+---------------------+-----------------------+
| Judy       | 202-     | FMD/FP              | Judy.Mittman@ed.gov   |
| Mittman    | 377-3328 |                     |                       |
+------------+----------+---------------------+-----------------------+
| Sherri     | 202-     | FMD/FP              | Sherri.Moten@ed.gov   |
| Moten      | 377-3329 |                     |                       |
+------------+----------+---------------------+-----------------------+
| Lambert    | 202-     | FMD/FP              | Lambert.Joyner@ed.gov |
| Joyner     | 377-3325 |                     |                       |
+------------+----------+---------------------+-----------------------+

**[Greetings and Introductions]{.underline}** -- Frank Ramos, Director,
Financial Management Division, FP Channel -

**[Remarks]{.underline}** -- Kristie Hansen, General Manager, Financial
Partner Channel. Kristie generally talked about the guaranty agencies
involvement in ED's clean opinion on the financial statement audit and
efforts underway to get FSA off the GAO high-risk list. In particular
she discussed the reconciliation of MR-32, Ending Balance on Defaulted
Loans to ED's calculated federal receivable balance and the importance
of monitoring these balances.

### Loan Processing and Issuance Fee (LPIF) Rate Change for FY 04

### 

### Pam Eliadis distributed a draft Dear Financial Partner Letter (attached) that communicates to the guaranty agency community how the Department will comply with the rate change for FY 04. The NCHELP/NSLDS Workgroup met about a month ago and that group suggested the method outlined in the letter (i.e., date of guarantee is the trigger for application of the rate, and since LPIF is self-correcting, if guarantee date applies to the higher rate, the loan will be paid at the higher rate). 

The LPIF loan level detail file currently contains the date of guarantee
and if for some reason GA reports incorrectly the loan detail files will
allow for adjustment. Two NSLDS files will be sent to FMS one for each
rate. Pam asked the question: "Do the GA's need separate invoices for
each rate or one invoice with an amount for each rate?"

There was some discussion among the group and the GA community seems to
be in agreement with this logic. Self-correct adjustments will be in the
loan level detail. Guarantee date is used to trigger which rate the loan
will be paid. Community seems to be in agreement with this logic. Ron
Bennett (NSLDS/Raytheon) asked the GA representatives, "If there was a
need for additional data elements in the detail file to support the LPIF
payment?" And "Does there need to be any additional information on the
current detail file?" GA's are using the file for forecasting expected
LPIF income, auditors look at LPIF payments and GA's are currently using
them more now than in the past.

Pam said NSLDS is going to remove Consolidation loans from the detail
file and Kay Morgan requested additional information on the delta. There
was also a discussion regarding removing the guarantees that are added
to the reconciliation that don't affect payment because there is no
disbursement. There is still time for NSLDS to make changes to the
detail files so let NSLDS (Pam) know as soon as possible while they are
working on new programming for new rate. Ron talked about the trailer
record and Kay suggested two files with summary trailer records. Pam
mentioned that the rate changeover will phase out in 24-36 months from
now and that's something to consider when implementing the new rate
change. NSLDS will have an issue with storing two rates?

**[Update on GAFR Enhancements (Presentation Attached)]{.underline}**

Barbara Johnson gave a brief overview of the GAFR enhancements.
Discussed hard edits vs. soft edits. Hard edits on line items MR-1,
MR-12, MR-13, MR-31 (comment required), and MR-32 must equal MR-33
through MR-40. Soft edits on federal receivable calculation, and annual
report CFY only.

Annual Form amendments can only be made in the current Fiscal Year.
Oracle can't accept more than one budget fiscal year at a time. In
addition, GA's using FTP will have to use the web application for these
amendments. Tim Cameron (NCHELP) wants to add this to the list of things
to be done during the next GAFR enhancement phase

GAFR enhancements are scheduled to be in production on Monday, August 4,
2003. A GA representative asked if implementation could be delayed to
coincide with the beginning of the fiscal year. At that point FMD staff
said that they were not in control of the implementation schedule, but
would raise the question and respond back to the group. In the meantime,
Tim is going to survey all GA's to determine if they will be ready for
the August 4^th^ implementation date.

**[Overview of the Federal Receivable Calculation vs.
MR-32]{.underline}**

Bill Marks and Peter Basso generally restated the reasons this issue is
so important. In addition, they raised some GA reporting changes that
would help them better determine the federal receivable balance.
Everything Bill suggested would require GA system changes. And this
discussion led to revisions to the current GAFR.

Some discussions regarding this subject

1.  Bill Marks wants Annual Reporting on a quarterly basis for line
    items AR-18, AR-34, and AR-37. FSA quarterly financial statements
    are the reason for requesting this information on a more frequent
    basis, i.e., monthly or quarterly. He mentioned that the auditors
    are currently looking at June and the final annual statement is due
    November 15^th^

2.  Looking at NSLDS for FFEL to DL and the federal receivable amount,
    the impact of timing differences between GA reporting on GAFR and
    accounts accepted by DCS.

3.  Bringing FSA's balance sheet back in line ... federal receivable
    balance vs. amounts reported to DCS, DL, and Treasury Offset. If the
    GA's can report the complement, is it possible for GA's to change
    Subrogated loan reporting process (i.e., batch ID). CFO Accounting
    will investigate with DCS to see if they can provide information
    that will facilitate reconciliation of MR-32.

4.  Determining the difference between the receivable amount and the
    complement. CFO Accounting proposed that GA's report complement in
    \"Other\" amounts. GA's said this would require system changes.

5.  Valerie Sherrer (NSLDS) commented that before CFO does a comparison
    between GA activity and NSLDS, they should compare DCS to NSLDS. CFO
    agreed to look at NSLDS vs. DCS before going to the GA's with
    specifics regarding complement reporting.

### Review GAFR Revised Instruction Guide 

The group went through the instructions and a revised version will be
sent to all Workgroup Members by June 20^th^ for review before posting
to the Financial Partner Portal.

### NSLDS vs. GAFR Reasonability 

At the last meeting it was determined that some Monthly GAFR data
elements (claims and collections) should be comparable to NSLDS. In
preparation for this meeting NSLDS and FMD put together some
reasonability spreadsheets for the GA workgroup members. Pam suggested
that NSLDS be used as a reasonability tool because of timing differences
... when data reported on the GAFR vs. reporting to NSLDS. In order to
get to that point we need to focus on definitions used by both systems
to ensure that all definitions are in sync. GA's identified this as a
major hindrance in getting the reasonability work done. During these
discussions the question was asked ... "GA are asked if they including
Consolidation loans in the principal amount of collections when
reporting to NSLDS?" (Tim will survey the GA's regarding this question).
The Collections Principal amount, in most cases, was much higher in
NSLDS than on the GAFR.

During these discussions it was decided there should be a line-by-line
reasonability threshold set. In order to get this done Tim and Pam will
establish a sub-group to determine (1) value of reasonability, (2) what
we know, (3) what we have, (4) what data elements are missing, and (5)
which data elements are being collected but not needed. This group will
draft instructions (DPI for NDSLS and GARF Instruction Guide) for any
data elements that conflict. This group should consist of individuals
with GAFR experience and NSLDS experience and the first conference call
will be scheduled for early August.

GA's requested their Annual Reasonability data as soon as it is
available. They do not want to wait for late reporting GA's. Pam agreed
to run and distribute the GAFR Annual Reasonability data as soon as
possible to each GA.

**[Conditional Disability Discharge (CDDT)]{.underline}**

Frank asked the group if they had concerns or issues with the CDDT
process. The GA's reported that there were still unsettled issues
regarding assigning these loans in particular the spousal Consolidation
loans where a small portion will be discharged, what happens to the rest
of the loan ... GA's cannot assign a portion of a loan and once the loan
is assigned the loan dies because there is no reporting to NSLDS to
update the loan.

Common Claim Initiative -- Tim gave the group an overview of CCI and
gave some links to NCHELP ([nchelp.org](../nchelp.org/)) website for
more information. The CCI is a standardized electronic data exchange
between guaranty agencies, lenders and servicers. The CCI has no impact
on GAFR reporting.

### 

Attachments

(1) Action Items -- Attachment A

(2) Draft LPIF Letter -- Attachment B

(3) GAFR Enhancement Presentation