description: tags: part%20rate%20index-235

8/14/2019 description: tags: part%20rate%20index-235

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FY 1998 Official Cohort Default Rate Guide Page 231

Participation RateIndex Appeal

This section is divided into two parts. The first part (pages 231through 244) provides background information on the participationrate index appeal and outlines the process and procedures forsubmitting a participation rate index appeal. The second part(pages 245 through 250) provides an example of a situation thatwould warrant the submission of a participation rate index appealand sample material as it would pertain to a participation rate index

appeal.To understand the participation rate index appeal process, the U.S.Department of Education (Department) recommends that thereader review both parts of this section. In addition, since aparticipation rate index appeal is a type of exceptional mitigatingcircumstances appeal, please refer to the Exceptional MitigatingCircumstances Appeal section beginning on page 221 foradditional information that applies to all exceptional mitigatingcircumstances appeals, including the participation rate indexappeal.

What is a participation rate index?A participation rate index is the percentage of a schools studentsthat obtain Federal Family Education Loan (FFEL) Program and/orWilliam D. Ford Federal Direct Loan (Direct Loan) Program loansmultiplied by the school's cohort default rate.

Please refer to page 235 for a more in-depth discussion on how tocalculate a participation rate index.

QUALIFYING

PART I: Background,Process, and Procedures


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Participation Rate Index Appeal Information for Schools on Adjustments and Appeals

Page 232 FY 1998 Official Cohort Default Rate Guide

Which schools are eligible to submit aparticipation rate index appeal?

Only a school that can demonstrate that it has a participation rateindex equal to or less than 0.0375 for any of the three most recentfiscal years (FY) for which data are available AND is subject to thefollowing sanctions as a result of the school's official cohort defaultrates may submit an exceptional mitigating circumstances appealbased upon its participation rate index:

initial loss of FFEL Program, Direct Loan Program,and/or Federal Pell Grant Program eligibility;

OR

extended loss of FFEL Program, Direct LoanProgram, and/or Federal Pell Grant Programeligibility.

Please refer to pages 36 through 38 of the "Cohort Default RateEffects" section for information on sanctions and consequencesbased on official cohort default rates.

A participation rate index appeal does NOT alleviatethe consequences associated with a cohort defaultrate that exceeds the limitation, suspension, and/ortermination (LS&T) threshold (i.e., 40.1 percent orgreater). However, if a school is subject to initial orextended loss of eligibility to participate in the FFELProgram, Direct Loan Program, and/or Federal PellGrant Program AND LS&T of all Title IV StudentFinancial Assistance Programs, the school maysubmit a participation rate index appeal to alleviatethe initial or extended loss of eligibility to participate inthe FFEL Program, Direct Loan Program, and/orFederal Pell Grant Program.

This checklist on the next page summarizes the eligibility criteria fora participation rate index appeal. A school should review thechecklist to determine if it can appeal on the basis of itsparticipation rate index.

If a school is ONLY

subject to LS&T (not initial orextended loss of loan and/orFederal Pell Grant Programeligibility), can it submit aparticipation rate indexappeal?

No, only those schoolssubject to initial or extendedloss of loan and/or FederalPell Grant program eligibilitycan submit a participationrate index appeal.

Note


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Information for Schools on Adjustments and Appeals Participation Rate Index Appeal


Participation Rate IndexAppeal Eligibility Checklist

To be eligible to submit a participation rate index appeal,a school must meet BOTH of the following criteria:

The school is subject to initial or extended lossof eligibility to participate in the FFEL Program,Direct Loan Program, and/or Federal Pell GrantProgram.

AND

The school's participation rate index is equal toor less than 0.0375 for any of the three mostrecent fiscal years for which data is available (inthis case FY 1998, FY 1997, and/or FY 1996).

How can a participation rate index appealaffect a schools loss of eligibility toparticipate in the FFEL Program, Direct LoanProgram, and/or Federal Pell Grant Program?If the Department determines that a school has a participation rateindex of 0.0375 or less for any of the three most recent fiscal yearsfor which data is available, the Department will withdraw itsnotification of loss or extension of loss of the schools eligibility toparticipate in the FFEL Program, Direct Loan Program, and/orFederal Pell Grant Program. 1

Which cohort default rates can be used to

determine a participation rate index?A school may choose to base its participation rate index on any ofits three most recent official cohort default rates (in this case FY1998, FY 1997, and/or FY 1996).

1 34 CFR Section 668.17(c)(1)(ii)(A)

Does a successfulparticipation rate indexappeal change a school'scohort default rate?

No, successfulparticipation rate indexappeals do not have anyaffect on the calculationof a school's cohortdefault rate.


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Because a school can submit a participation rateindex appeal for any of its three most recent officialcohort default rates, a school that has submitted asuccessful participation rate index appeal for either ofits two previous official cohort default rates (in thiscase FY 1997 and/or FY 1996) will not be subject toinitial or extended loss of FFEL Program, Direct LoanProgram, and/or Federal Pell Grant Programeligibility. The Department will automatically identifyany school that has submitted a successfulparticipation rate index appeal for either of the twoprevious cohort periods. These schools will benotified that the school is NOT subject to loss ofeligibility to participate in the FFEL Program, DirectLoan Program, and/or Federal Pell Grant Programeven if the schools' three most recent official cohortdefault rates are equal to or greater than 25.0percent.

Are participation rate index appeals based on aspecific period of time?

Yes, the school must base the participation rate index appeal on a12-month period that has ended during the six months immediatelypreceding the fiscal year for which the cohort of students used tocalculate the schools cohort default rate is determined. 2

Please refer to pages 226 through 229 of the ExceptionalMitigating Circumstances Appeal section for a description ofacceptable 12-month periods.

2 34 CFR 668.17(c)(1)(ii)(A)

Note


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A school must select a 12-month period that endsduring the six months immediately preceding thefiscal year, which is used to determine the cohortdefault rate used to calculate its participation rateindex. Information on how to select an acceptable12-month period is provided on pages 226 through229 in the "Exceptional Mitigating CircumstancesAppeal" section.

How does a school calculate its participationrate index?

The participation rate index is calculated as follows:

To succeed on a participation rate index appeal,the school must have a participation rate index of0.0375 or less. Please refer to the next page foran example.

Xthe schoolsrelevantcohortdefault rate

number of regular students included inthe denominator who received an FFELProgram loan and/or Direct LoanProgram loan for a loan period thatoverlaps the selected 12-month periodby at least one day

number of regular students enrolled onat least a half-time basis during any part

of the selected 12-month period

Note

What is a regularstudent?

A regular student isdefined as a person whois enrolled, or acceptedfor enrollment, at aschool for the purposeof obtaining a degree,certificate, or otherrecognized educationalcredential offered bythat institution asdefined in 34 CFR

Section 600.2.


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Example: Welding School's FY 1998 official cohort default rateis 25.0 percent. Welding School had a total of 200regular students enrolled on at least a half-time basisduring any part of the selected 12-month period. Ofthose 200 students, 14 borrowers received an FFEL

Program loan for a loan period that overlapped theselected 12-month period by at least one day and 12different borrowers received a Direct Loan Programloan for a loan period that overlapped the selected 12-month period by at least one day. Welding School'sparticipation rate index is calculated as follows:

Which students are included in thedenominator of the participation rate index?

To be included in the denominator of the participation rate index, astudent must have been 3

a "regular student" (i.e., a student that enrolled, orwas accepted for enrollment, at a school for the

purpose of obtaining a degree, certificate, or otherrecognized educational credential offered by thatschool);

enrolled on at least a half time basis;AND

enrolled for at least one day in the 12-month periodselected by the school.

3 CFR Section 668.17(c)(1)(ii)(A)

X =0.25014 (FFEL) + 12 (DL) = 26

200

0.0325

If a student has a breakin enrollment and leavesschool, then returns andbegins a new enrollmentperiod, all during theselected 12-month period,which enrollment datesshould the school use?

A school should list bothenrollment periods.However, the student willonly be counted once in theparticipation rate indexcalculation.


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A student's entire enrollment period does NOT haveto fall within the selected 12-month period. A studentthat enrolled prior to the 12-month period butcompleted/withdrew from the program of study duringthe 12-month period is considered to have been

enrolled during the 12-month period. In addition, astudent that enrolled during the 12-month period butcompleted/withdrew from the program of study afterthe 12-month period is considered to have beenenrolled during the 12-month period. Finally, astudent that enrolled prior to the 12-month period andcontinued to be enrolled until after the 12-monthperiod is considered to have been enrolled during the12-month period.

Which borrowers are included in the

numerator of the participation rate index?To be included in the numerator of the participation rate index, theborrower must first be included in the denominator of theparticipation rate index calculation. If a borrower is included in thedenominator of the participation rate index calculation and meetsthe following conditions, the borrower will also be included in thenumerator of the calculation: 4

the borrower received an FFEL Program and/or DirectLoan Program loan;

AND

the FFEL Program and/or Direct Loan Program loanperiod overlaps the 12-month period selected by theschool by at least one day.

If any part of the loan period falls within the 12-month period, the student must be identifiedand counted as having received a loan.

4 HEA Section 435(a)(6)(A)

If a borrower has morethan one loan with a loanperiod that falls during theselected 12-month period,which loan data should aschool reference in itsappeal?

A school should list bothloans. However, theborrower will only be countedonce in the participation rateindex calculation.

Note

Note


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What are the time frames and procedures forsubmitting a participation rate index appeal?

Timing is critical when submitting a participation rate indexappeal.

The following is a step by-step description of the time frames andprocedures associated with a participation rate index appeal.

Step 1: Within 30 calendar days 5 of receiving the school'sofficial cohort default rate notification letter, a schoolmust review this Guide to determine if the schoolis eligible to submit a participation rate index appeal.

Please refer to page 232 for a detailed discussionregarding which schools are eligible to submit aparticipation rate index appeal.

Step 2: If the school is eligible to submit a participation rateindex appeal, within the time frame described inStep 1 , (i.e., within 30 calendar days of receiving theschool's official cohort default rate notification letter) aschool must compile a spreadsheet to list and count

the students who will be included in the schoolsparticipation rate index.

A school should refer to the Participation Rate IndexAppeal SPREADSHEET and SPREADSHEETINSTRUCTIONS on pages 249 and 248, respectively,to assist in developing the list.

5 34 CFR Section 668.17

TIMING AND SUBMITTING

Time framesmay overlap.Read ALL

steps.

Please referto page 247for anexample of asituation thatwouldwarrant thesubmissionof a

participationrate indexappeal.

Example

Please referto page 249for anexample ofthespreadsheet.

Example


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If a school does NOT have anystudents that received FFEL Programand/or Direct Loan Program loanswith loan periods that overlap theselected 12-month period, the school

does NOT have to submit a participationrate index appeal SPREADSHEET tothe Department. However, the schoolmust send the Department, within 30calendar days of receiving the schoolsofficial cohort default rate notificationletter, a LETTER which identifies theschool's selected 12-month period andindicates that the school did not haveany students that received FFELProgram and/or Direct Loan Program

loans with loan periods that overlap the12-month period in question.

If a school does have students thatreceived FFEL Program and/or DirectLoan Program loans that have loanperiods that overlap the schoolsselected 12-month period, the schoolmust follow the steps outlined in thisguide in order for the Department toconsider the schools participation rateindex appeal.

A school should provide the following information onthe spreadsheet:

the schools name and OPE ID Number ; the school's official cohort default rate that

will be used to calculate the school'sparticipation rate index;

the beginning and ending dates for the 12-month period on which the school is basing itsparticipation rate index;

For information on selecting anacceptable 12-month period, pleaserefer to pages 226 through 229 of theExceptional Mitigating CircumstancesAppeal section.

Note

Note


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Page 240 FY 1998 Official Cohort Default Rate G uide

the Social Security numbers , in numericalorder, of all the regular students enrolled on atleast a half-time basis during any part of theselected 12-month period;

These are the students that will be included inthe denominator of the participation rate indexcalculation.

for each Social Security number, list thestudents name ;

for each student, provide beginning and endingenrollment dates [For all enrollment dates,include the month, day, and year(MM/DD/CCYY)];

If a student was enrolled at the schoolmore than once during the selected 12-month period, list each set of enrollmentdates. However, the student will only becounted once in the calculation.

if the student received an FFEL Programand/or a Direct Loan Program loan with aloan period that overlaps the selected 12-month period, enter the type of loan(s)

received (if not, do not make an entry);These are the borrowers that will be included innumerator of the participation rate indexcalculation.

for each borrower with an FFEL Program loanand/or a Direct Loan Program loan identified,provide the beginning and ending dates of theloan period ;

If the borrower has more than one loan,list the loan periods associated witheach loan. However, the borrower isonly counted once in the calculation.

What is a regularstudent?

A regular student isdefined as a person whois enrolled, or accepted

for enrollment, at aschool for the purposeof obtaining a degree,certificate, or otherrecognized educationalcredential offered bythat school as defined in34 CFR Section 600.2.

Note

Note


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Step 3: Within the time frame described in Step 1 , (i.e.,within 30 calendar days of receiving the school'sofficial cohort default rate notification letter) a schoolmust calculate its participation rate index.

Identify the schools relevant official cohortdefault rate which can be found on the schoolsofficial cohort default rate notification letter.

From the Participation Rate Index AppealSPREADSHEET created in Step 2, count thenumber of borrowers who received an FFELProgram and/or Direct Loan Program loanduring the selected 12-month period andwhose loan periods overlap the 12-monthperiod by at least one day. These are theborrowers who will be included in thenumerator of the participation rate index.

From the Participation Rate Index AppealSPREADSHEET created in Step 2, count thetotal number of students listed on thespreadsheet. These are the students whowill be included in the denominator of theparticipation rate index.

Divide the number of borrowers who receivedan FFEL Program and/or Direct Loan Programloan during the selected 12-month period andwhose loan periods overlap the 12-monthperiod by at least one day by the number ofstudents listed on the spreadsheet and multiplythe result by the relevant official cohort defaultrate identified by the school. This is theschools participation rate index .

For a successful appeal, the schools participationrate index must be 0.0375 or less.Note


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Within the time frames described in Step 4 on page 242, thefollowing MATERIAL, to support a participation rate index appeal,should be sent to the Department's Default Management Division atthe address shown on page 244.The section behind Tab 1 contains:

A LETTER on the schools letterhead with the schools OPE ID number; a statement indicating that the school is

submitting a participation rate index appeal; the relevant cohort default rate on which the

appeal is based; a certification sentence that indicates that the

information provided in the appeal, underpenalty of perjury, is true and correct;

a list of the other adjustments/appeals theschool intends to submit to the Department;

AND the signature of the schools President/

CEO/Owner, followed by a signature blockproviding the signers name and job title.

Schools should refer to the sample Participation RateIndex Appeal LETTER on page 250.

The section behind Tab 2 contains:

A SPREADSHEET of the schools students includedin the participation rate index.

Schools should refer to the Sample ParticipationRate Index Appeal SPREADSHEET andSPREADSHEET INSTRUCTIONS on pages 249and 248, respectively, to assist in developing thelist.

The Department will not consider informationsubmitted after the regulatory deadline. TheDepartment will send the school written notification ofits decision.

Tab 1

Tab 2

Note


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Participation Rate Index Appeal Information for Schools on Adj ustments and Appeals


If sent by commercial overnight mail/courier delivery, send theschools participation rate index appeal to:

U.S. Department of EducationDefault Management Division

ATTN: Participation Rate Index AppealPortals Building, Room 63001250 Maryland Avenue, SWWashington, DC 20024

If sent by U.S. Postal Service, send the schools participation rateindex appeal to:

U.S. Department of EducationDefault Management DivisionATTN: Participation Rate Index AppealPortals Building, Room 6300400 Maryland Avenue, SWWashington, DC 20202-5353

The Department will not accept any appealcorrespondence by facsimile (fax) or e-mail.

The Department recommends that a school send all appealcorrespondence return receipt requested or via commercialovernight mail/courier delivery. This will be useful to a school if it isasked to authenticate the timeliness of its appeal. A school shouldmaintain the documentation which verifies the receipt of the appealrelated material. In addition, a school should retain copies of alldocumentation submitted as a part of the appeal process.

Note


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Part II of the Participation Rate Index Appeal section outlines asituation in which a school would benefit from submitting aparticipation rate index appeal. This part also provides samplematerial that should be referenced by a school when compiling thematerial that must be submitted by a school during the participationrate index appeal process.

CONTENT REFERENCE FOR PART II

EXAMPLE of a situation that warrants the submission ofa Participation Rate Index Appeal...................................................247

Participation Rate Index Appeal SPREADSHEETINSTRUCTIONS.................................................................................248

Sample Participation Rate Index Appeal SPREADSHEET...........249

Sample Participation Rate Index Appeal LETTER..........................250

PART II: Examples andSupporting Material


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EXAMPLE of a situation that warrants the submission of aParticipation Rate Index Appeal

Welding School received notification of its FY 1998 official cohort default rateon September 30, 2000.

Within 30 calendar days of receiving its FY 1998 official cohort default rate,the school:

determined that it was eligible and would benefit from submitting aparticipation rate index appeal;

According to the FY 1998 official cohort default rate notificationletter, Welding School is subject to initial loss of eligibility to

participate in the FFEL Program, Direct Loan Program, andFederal Pell Grant Program. The school believes itsparticipation rate index is below the 0.0375 threshold.

selected its FY 1998 official cohort default rate as the cohort default rateon which its participation rate index would be based (please refer to page233 for information on which cohort default rates a participation rate indexappeal may be based);

identified April 2,1996 - April 1,1997 as an acceptable 12-month period forits participation rate index calculation (please refer to pages 226 through

229 for information on how to identify an acceptable 12-month period); prepared a SPREADSHEET that lists the students included in its

participation rate index calculation (please refer to the Sample ParticipationRate Index Appeal SPREADSHEET on page 249);

prepared a LETTER to the U.S. Department of Education's DefaultManagement Division for its participation rate index appeal (please referthe Sample Participation Rate Index Appeal LETTER on page 250);

On October 10, 2000, Welding School mailed the MATERIAL associated withits participation rate index appeal return receipt requested to the DepartmentsDefault Management Division at the address found on page 244.


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Sample Participation Rate Index Appeal SPREADSHEET

P a r

t i c i p a t

i o n

R a t e

I n d e x

A p p e a

l

b a s e d o n t

h e

F Y 1 9 9 8 O f f i c i a l C o h o r t

D e f a u

l t R a t e

S c h o o

l N a m e :

W e l

d i n g

S c h o o

l

O P E I D N u m

b e r :

0 0 0 0 5 0

C o h o r

t D e f a u

l t R a t e : F

Y 1 9 9 8 O f f i c i a l

C D R =

2 5 . 0

%

1 2 - M o n

t h P e r

i o d : 4 / 2 / 1 9 9 6 4

/ 1 / 1 9 9 7

5 .

B e g

i n n

i n g

d a

t e s a n

d e n

d i n g

d a

t e s

o f l o a n p e r i o

d s

f o r

F F E L P r o g r a m

a n

d / o r

D i r e c

t L o a n

P r o g r a m

l o a n s ,

i f r e c e

i v e

d

( f r o m

M M / D D / C C Y Y t o M M / D D / C C Y Y )

9 / 3 0 / 1 9 9 6 - 3 / 1 0 / 1 9 9 7

4 .

I f b o r r o w e r r e c e

i v e

d a n

F F E L P r o g r a m

l o a n

( F F E L ) a n

d / o r

D i r e c

t L o a n

P r o g r a m

l o a n (

D L )

d u r i n g a n y p a r t o

f t h e

1 2 - m o n

t h

p e r i o

d ,

e n

t e r

t h e

t y p e o

f l o a n r e c e

i v e

d

( F F E L o r

D L )

F F E L

3 .

S t u d e n

t ' s

e n r o

l l m e n

t d a t e s

( f r o m

M M / D D / C C Y Y

t o M M / D D / C C Y Y )

3 / 1 5 / 1 9 9 6 - 3 / 1 0 / 1 9 9 7

6 / 1 6 / 1 9 9 6 - 1 0 / 3 / 1 9 9 7

2 . S

t u d e n

t ' s

N a m e

J a n e

S m i t h

J o h n D o e

1 . S

t u d e n

t ' s

S S N

1 1 1 - 1 1 - 1

1 1 1

2 2 2 - 2 2 - 2

2 2 2

B o x

A

A p p

l i c a b

l e C o h o r t

D e f a u

l t R a t e

2 5 . 0

%

N o . o f

B o r r o w e r s

R e c e i v i n g

F F E L / D L l o a n s

( r e p o r

t e d i n c o

l u m

n 4 )

2 6

N o . o f

R e g u l a r

S t u d e n

t s ( l i s t e d

i n c o

l u m n

1 )

2 0 0

P a r

t i c i p a t

i o n

R a t e

I n d e x

0 . 0

3 2 5

1 1 / 1 0 / 2 0 0 0

[ s e n

d t o U . S

. D e p a r

t m e n

t o f E d u c a

t i o n ' s

D e f a u

l t

P a g e

1 o f

1

M a n a g e m e n

t D i v i s i o n a t

t h e a d

d r e s s

l o c a

t e d o n p a g e

2 4 4 . ]

N o t e :

T h i s

i s a s a m p l

s p r e a d s h e e

t . S e e

i n s t r u c t

i o n s

o n t h e p r e v

i o u s p a g e


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Sample Participation Rate Index Appeal LETTER

October 10, 2000

U.S. Department of Education OPE ID#: 000050Default Management DivisionAttn: Participation Rate Index AppealPortals Building, Room 6300400 Maryland Avenue, SWWashington, DC 20202-5353

Dear Default Management Division:

Welding School, OPE ID# 000050 , is submitting its participation rate indexappeal based on its FY 1998 official cohort default rate.

I, the undersigned, certify under penalty of perjury, that our participation rateindex is 0.0325 based on a 12-month period that began on April 2, 1996 andended on April 1, 1997. I certify that all information submitted in support ofthis participation rate index appeal is true and correct.

Welding School is submitting its participation rate index appeal at this time;however, the school has also timely submitted an uncorrected dataadjustment.

Please see the enclosed spreadsheet.

Thank you for your consideration.

Sincerely,

Larry Travis,President

Enclosure

Subject: Participation Rate Index Appeal based on FY 1998Official Cohort Default Rate

Welding School1234 Wedgewood LaneLeonardtown, Wisconsin 12345-6789123 456-7890

Sample Letter

description: tags: part%20rate%20index-235

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