# Presentation: 161406

## Session #4

- TITLE IV FUNDING TO SCHOOLS:  FROM COD through GAPS
- Anthony Laing
- George Karayianis
- Tremayne Cobb

## Session Outline

**Session Outline**

**Pell, ACG & National SMART Grant Funding**
**Direct Loans Funding**
**GAPS – New Web Screens**

## Iron Triangle of Funds Management:

**Department of Education**

## Iron Triangle of Funds Management:

**Iron Triangle of Funds Management:**

**School**

## Funding Lifecycle

## Daily ProductionCOD 24-Hour Turnaround

- Deadlines10:00 AM ET in COD  - Same Day10:00 PM ET in COD - Next Day

## Initial Authorization

- Pell Grant
- Program-wide authorization in May
- Advance Funded
- Records first for a few exceptions
- ACG & National SMART Grant
-  ***NO*** program-wide authorization
-  Records first

## When to Submit Disbursement Records

- Pell Grant
- 30 Days in advance of disbursement date
- 7 days before COD sends funding transaction to GAPS
- ACG & National SMART Grant
- 7 Days in advance of disbursement date
- 7 days before COD sends funding transaction to GAPS

## Pell Administrative Cost Allowance (ACA)

- Three Times During an Award Year Cycle
*For 2007-2008:*
- March 2008
- August 2008
- August 2009
- NO DRAWDOWNSPayments sent directly to bank accounts by GAPS

## Pell Reduction to Net Accepted and Posted Disbursement Records

*For 2007-2008:*

- Reduction Cycle will reduce the Authorization to equal Net Accepted and Posted Disbursements (NAPD)

## Stay Reconciled!

## Reconciliation Tools

- Reconciliation File
- Snapshot
- YTD File
- Comprehensive

## Pell Verification-W Reduction

- For Award Year 2007-2008, Verification-W Reduction will be run in Summer 2008
- Verification Status of W is an *interim status*
- Schools must change status to V, S, or blank
- Otherwise, FSA will reduce to zero

## No-Pell DeobligationACG, National SMART Grant

- If student has either an ACG or National SMART Grant and not a Pell recipient, the student will lose the ACG/National SMART Grant
*For Award Year 2007-2008, No-Pell Deobligation will be run in Summer 2008*

## Reduction to GAPS Net DrawdownPell, ACG, National SMART Grant

- For Award Year 2007-2008, Reduction to GAPS Net Drawdown is scheduled for March 2010
- Schools not in compliance with 30-day reporting rule

## Reduction to GAPS Net DrawdownExample

## Individual Reductions

- POP Process
- Only for Pell, not in ACG & National SMART Grant
- Negative Pendings

## Post-Deadline Processing

- For Award Year 2007-2008:
- Occurs After September 30, 2008
- Schools Request on the Web
- Request only when you are ready to submit

## Closeout/Reconciliation

- For Award Year 2007-2008, Schools*** SHOULD ***be reconciled by September 30, 2008
- Must closeout within...
**Pell: **Five Years
**ACG, SMART: ***Four* Years

## Title IV Funding to Schools

**Title IV Funding to Schools**

**Pell, ACG & National SMART Grant Funding**
**Direct Loans Funding**
**GAPS – New Web Screens**

## Direct Loan FundingHow do schools get their $money$?

**Direct Loan Funding****How do schools**** get their ****$money$?**

## Funding Lifecycle

- Initial Funding
- Disbursement and Loan processing (in COD)
- Drawdowns (through GAPS)
- Monthly reconciliation disbursements/cash
- School/COD/GAPS
- End of Award Year Reconciliation and Closeout

## Iron Triangle of Funds Management:

**Direct Loans**

## Funding based on booked loans/disbursements

7 day rule 
Records submitted up to 7 days in advance of disbursement date can trigger change in funding

Cash Management Regulations
30 day reporting requirement
3 -Day cash rule
Monthly reconciliation (DL only)

- 7 day rule
- Records submitted up to 7 days in advance of disbursement date can trigger change in funding
- Cash Management Regulations
- 30 day reporting requirement
- 3 -Day cash rule
- Monthly reconciliation (DL only)

**Funding Basics**

## Funding Delivery Methods

**Funding Delivery Methods**

**Notes:**
Currently there are 2 different funding methods, or ways schools get money for DLs
Advance funding/school initiated drawowns, or Pushed Cash/system initiated drawdowns.  The names here are important because they focus us on the key difference between the two.  Advance funded schools are where the school initiates the drawdowns.  Push Cash is where the “system” or in the case “COD” initiates the drawdowns on behalf of the school.
.  

## School receives an initial CFL
School draws down cash via GAPS
School submits booked disbursements to substantiate cash received
(including an accepted and linked MPN)
COD sends CFL increases to GAPS so school can continue to drawdown funds as needed

- School draws down cash via GAPS
- School submits booked disbursements to substantiate cash received
- (including an accepted and linked MPN)
- COD sends CFL increases to GAPS so school can continue to drawdown funds as needed

**Advanced Funds/School-Initiated Drawdowns**

**Notes:**
Funding is program and award year specific.  So, for each award year, let’s say 06-07, each advance funded school is given an initial CFL or current funding level.  The CFL is another term for the amount of money or authorization from which a school can draw against.  If you think of it in terms of your personal bank account,  your initial CFL would be similar to the amount you deposited to open your account.     Once an advance funded school has their initial CFL, they can drawdown (via GAPS) their current cash need.  Then the  school will send in disbursement records to substantiate (or account for) the cash they drew down.  As cash is substantiated, CDO will give the school more CFL so the school will continue to have funds to draw against.

## Funding FlowAdvanced Funds

**SCHOOL**

**GAPS**

**COD**

**Batches**

**CFL**

**Funding Flow****Advanced Funds**

## COD initiates drawdown requests and cash is  deposited  in a school’s bank account based on disbursements accepted and posted by COD 

Schools must have an accepted origination record and MPN on file before an actual disbursement is accepted and cash is pushed to a school

- Schools must have an accepted origination record and MPN on file before an actual disbursement is accepted and cash is pushed to a school

**Pushed Cash/System-Initiated Drawdowns**

**Notes:**
The second funding type or method we have in DL is called Pushed Cash/system initiated drawdowns.  For school’s on Pushed Cash, COD takes on the bulk of the funding responsibility.  Under this funding type, COD initiates the appropriate amount of funds for a school and the cash is automatically deposited in the school’s bank account.  COD generates the funding based on actual disbursements submitted by the school and accepted by COD.  Note that school’s must have an accepted origin. Record and MPN on file before an actual disbursement can be accepted and funded.  Every time funds are “pushed” to a school, a report is generated telling the school which students to pay with the funds they received.  
The advantages to the Push Cash system are many:
Less work for school (funding is done by COD)
System is self balancing (cash vs disbursements)
COD tells the school which students to fund
Makes reconciliation and closeout very easy

## Funding FlowPushed Cash

**SCHOOL**

**GAPS**

**COD**

**Batches**

**CFL**
**Drawdowns**
**FDLs**

**Notes:**
If you want to add something to this, you could add the Direct Loan Servicing Center (DLSC) and draw a line from COD to DLSC showing booked loan information going to DLSC.

## Example:Funded Disbursement Listing

- Run Date:  11/2/07	                                    US Department of Education			 Page:  1
- Federal Direct Loan Program
-   Funded Disbursement Listing Report
- For Loans to be Funded by:  11/1/07
- For Academic Year 2007-2008
- School:  Capital Hair Salon                                                                                                School Code:  G11111
- 	      13 Maple Pl.
- 	     Washington, DC 20202
- Student             Loan ID	             Disb Date          Gross	 Fee     Rebate        Net Amt.
- Sally Mae       233234454S08G11111001     11/2/07          $2,500      -$100     $38           $2,438
- Jerry Jones      212121233S08G11111001   10/28/07         $2,383      -$95        $36          $2,324
- Marcy Kay      887890766U08G11111001    11/5/07          $2,000      -$80        $30          $1,950
-                                                                                                     	          --------------------				 	                   Total School Amount                $6,712

## 30-Day Reporting Requirement
685.301(d) Direct Loan

3-Day Cash Rule
668.162(b)

Monthly Reconciliation
685.102(b) Direct Loan

- 685.301(d) Direct Loan
- 3-Day Cash Rule
- 668.162(b)
- Monthly Reconciliation
- 685.102(b) Direct Loan

**Cash Management Requirements**

## Reconciliation and Closeout

**Notes:**
Since reconciliation and closeout are such an important part of cash management, we will briefly discuss here.  However, for more a more in-depth discussion please try to attend session 47 DL Recon and Closeout

## Monthly Reconciliation 
Compare your records with the Dept’s to identify and resolve outstanding discrepancies 

Closeout
Net Accepted and Posted
Disbursements =GAPS net cash
Ending Cash Balance (ECB) = 0

- Monthly Reconciliation
- Compare your records with the Dept’s to identify and resolve outstanding discrepancies
- Closeout
- Net Accepted and Posted
- Disbursements =GAPS net cash
- Ending Cash Balance (ECB) = 0

**Direct Loan Reconciliation versus End-Of-Year Closeout**

**Notes:**
Monthly reconciliation is a regulation and school’s should be comparing their records with the Dept’s to identify and resolve any outstanding discrepancies.  There are many reports and web screens in both COD and GAPS that can help you with your reconciliation.
The closeout process occurs at the end of the award year when your school sends in any remaining records or cash to  close the award year.  The goal is to be at an ECB of 0, where disbursements = net drawdowns/cash.

## Your Ending Cash Balance Equation

**Cash**
**Balance**

**Cash**
**Receipts**

**Refunds **
**Of Cash**

**+**

**Ending**
**Cash****Balance**

**=**

**Downward**
**Adjustments**

**+**

**Upward**
**Adjustments**

**-**

**Disburse-****ments**

**Your Ending Cash Balance Equation**

**-**

**-**

## COD Funding Web screens
Reports (COD)
School Account Statement (SAS) Report
GAPS web screens and reports 

- Reports (COD)
- School Account Statement (SAS) Report
- GAPS web screens and reports

**COD and GAPS Tools****Direct Loan Reconciliation**

## School Funding InformationWeb Screen

- Funding Info
**Program**     Direct Loan	**Award Year**  07-08

**School Funding Information****Web Screen**

| Entity ID | 44544444 |
| --- | --- |
| Initial CFL | $56,000 |
| Current CFL | $200,000 |
| Available Balance | $15,000 |
| Cash > Net Accepted & Posted Disbursements | $0 |
| Net Accepted & Posted Disbursements | $185,000 |
| Net Drawdowns	 | $185,000 |
| Disbursement To Drawdown Ratio | 1.0000  |

## Cash Activity Screen

- _School of Outstanding Students_
**Program**   Direct Loan		**Award Year**  07-08
**Net Draws**					               $30,000
**Cash > Accepted & Posted Disbursements & older than 30 days    **$0
- 					**Totals**
- Date of Transaction					**10/13/07**
- Time							1:35PM
- Drawdowns				**$30,000**  	$2,000
- Drawdown adjustments			**$0**
- Refunds					**$1,000**
- Returns					**$0**
- Days for On-time reporting
- Payment Control Number		                                      2007101321221
- Accepted & Posted Disbursements Applied	**$20,000**   	$0
- Cash > Accepted & Posted Disbursements	**$10,000**
- Source System						GAPS**	**

## Monthly COD Report  
Copied from main database
Loan/Disbursement Information
Summary 
Detail 
Cash Detail

- Copied from main database
- Loan/Disbursement Information
- Summary
- Detail
- Cash Detail

**Direct Loan School Account Statement (SAS) Report**

## Title IV Funding to Schools

**Title IV Funding to Schools**

**Pell, ACG & National SMART Grant Funding**
**Direct Loans Funding**
**GAPS – New Web Screens**

## G5 Phase 1General Overall Improvements

- Enhanced self-management of personal profile and account maintenance including self-registration, edit profile, password reset, and unlock account functionality
- New descriptive payment flag status fields
- More descriptive error messages
- Automated email functionality throughout G5
- Flexible sort functionality
- Introduction of My Home Page

## General Overall Improvements (Continued)

**New My Awards Feature** will display an interactive list of your awards and balances on your G5 Home Page
**Greater Reporting Flexibility** with additional report parameters
**New G5 Training and Help Facility **will provide Online Simulated Training & Materials
**Dynamic Web Based Environment** will provide greater screen control features and flexibility by utilizing the newest technologies
**Consistent Three Step Processing** for workflow management provides a logical path to process your payment requests (Payments > Summary > Confirmation)

## G5 HOME   PAGE

## Making a Payment Request

## Payments Tab

## Payment Summary Tab

## Automated Email

- Tremayne,
- Requesting User ID: Tremayne@ed.gov
-    Your request made on 09/25/2007 for $25,172.32, has been received. Your control number is 2007092506381 and you will receive your funds on 09/27/2007 in bank account ****9426
- If you did not request this payment, please contact Helpdesk at 1-888-336-8930

## Creating an Adjustment

## Create Adjustments

## Adjustment Summary Page

## Adjustment Confirmation

## COD School Relations Center 
1-800-848-0978

GAPS Helpdesk
1-888-336-8930

- 1-800-848-0978
- GAPS Helpdesk
- 1-888-336-8930

**Need Funding Help?**

## Related Conference Sessions

| Session #5 | Operational Update: ACG & National SMART |
| --- | --- |
| Session #10 | Requirements for Federal Grant Programs:  Pell, ACG, & National SMART |
| Session #40 | A Direct Loan Primer |

## Contact Information

**Anthony Laing**Supervisor, Pell Program Operations Division_[anthony.laing@ed.gov](mailto:anthony.laing@ed.gov)__(202) 377-3112_
**George Karayianis**Funds Management Lead, Direct Loan Program Operations Division_[george.karayianis@ed.gov](mailto:george.karayianis@ed.gov)__(202) 377-3141_
**Tremayne Cobb**Management Analyst, Financial System Operations Group _[tremayne.cobb@ed.gov](mailto:tremayne.cobb@ed.gov)__(202) 260-4392_