Federal Student Financial Aid Penalties for Drug Law Violations
The Higher Education Act of 1965 as amended (HEA) suspends aid eligibility for students who have been convicted under federal or state law of the sale or possession of drugs, if the offense occurred during a period of enrollment for which the student was receiving federal student aid (grants, loans, and/or work-study). If you have a conviction(s) for these offenses, call the Federal Student Aid Information Center at 1-800-4-FED-AID (1-800-433-3243) or complete the Student Aid Eligibility Worksheet on the FAFSA to find out how this law applies to you.
If you have lost federal student aid eligibility due to a drug conviction, you can regain eligibility if you pass two unannounced drug tests conducted by a drug rehabilitation program that complies with criteria established by the U.S. Department of Education.
Even if you are ineligible for federal aid, you should complete the FAFSA because you may be eligible for nonfederal aid from states and private institutions. If you regain eligibility during the award year, notify your financial aid administrator immediately. If you are convicted of a drug-related offense after you submit the FAFSA, you might lose eligibility for federal student aid, and you might be liable for returning any financial aid you received during a period of ineligibility.
Refund Policy for Title IV Recipients
Federal regulations require each educational University to have a written policy for the refund and repayment of federal aid received by students who withdraw during a term for which payment has been received. These policies are effective only if a student completely terminates enrollment (i.e., cancels his/her registration, withdraws, or is dismissed) or stops attending classes before completing more than 60% of the enrollment period.
Students who withdraw during the drop/add period are eligible to receive a refund of tuition according to the institutional refund policy. Following the drop/add period, adjustments to tuition resulting from official resignations are based on the effective date of withdrawal and in accordance with the federally mandated calculation as specified in Section 484B of the Higher Education Act. This law also specified the order of return of Title IV funds to the programs from which they were awarded.
The calculation is based on the period of enrollment completed. That percentage is computed by dividing the total number of calendar days in the term into the number of calendar days completed as of the date of student notification. The percentage of Title IV assistance to which the student is entitled (has "earned") is equal to this percentage of the term completed, up to 60%. If the withdrawal occurs after 60% of the term is completed, the percentage is equal to 100%.
The amount of Title IV aid which must be returned is based on the percentage of "unearned" aid. That percentage is computed by subtracting earned aid from 100%. The University is required to return the lesser of: 1) the unearned aid percentage applied to institutional charges or 2) the unearned aid percentage applied to the total Title IV aid received.
The student is required to return the difference between the amount of unearned aid and the amount returned by the University. The student will be billed for the amount the student owes the Title IV programs and any amount due to the University resulting from the return of Title IV funds used to cover University charges. If the student (or parents in the case of a PLUS loan) is required to return a portion or all of their loan proceeds, the calculated amount is to be repaid according to the loan's terms. Students must return only half the amount of grant funds calculated.
Funds are returned to the following Title IV sources in order of priority:
- Unsubsidized Direct Loans
- Subsidized Direct Loans
- Direct PLUS Loans
- Federal Perkins Loans
- Federal Pell Grants
- Federal SEOG
- Other Title IV assistance for which the return of funds is required
- Other federal, state, or institutional financial assistance
National Student Loan Data System
The National Student Loan Data System is a centralized database of all Title IV (federal) aid that a student has received (including Parent Loan information for Parent Borrowers) at all colleges and universities that participate in T-IV aid. For federal loans it also includes servicer contact information.