FEA (Legal)

Financing Education: Financial Aid and Scholarships

Financial Aid

Applications

Free Application for

Federal Student Aid

Each individual seeking to apply for federal financial aid under 20 U.S.C. Chapter 28, Subchapter IV, for award year 2024-2025 and any subsequent award year shall file a free application with the secretary of education, known as the Free Application for Federal Student Aid (FAFSA), to determine eligibility for such aid, as described in 20 U.S.C. 1090(a)(2), and in accordance with 20 U.S.C. 1087ss.

The secretary of education shall enable applicants to submit a FAFSA and initiate the processing of such application, not later than October 1 prior to the applicant’s planned year of enrollment.

20 U.S.C. 1090(a)(1), (d)(4)(A)

Information

Provided to College

An institution:

1. Shall use the information provided to it solely for the application, award, and administration of financial aid to the applicant;

2. May use the information provided, excluding the information described under 26 U.S.C. 6013(l)(13), for research that does not release any individually identifiable information on any applicant, to promote college attendance, persistence, and completion; and

3. Shall not share such educational record information with another entity without the explicit written consent of the applicant.

20 U.S.C. 1090(a)(3)(C)

FAFSA Verification

Procedures

An institution must establish and use written policies and procedures for verifying an applicant's FAFSA information in accordance with the provisions of 34 C.F.R. Part 668, Subpart E. These policies and procedures must include:

1. The time period within which an applicant must provide any documentation requested by the institution in accordance with 34 C.F.R. 668.57;

2. The consequences of an applicant's failure to provide the requested documentation within the specified time period;

3. The method by which the institution notifies an applicant of the results of its verification if, as a result of verification, the applicant's expected family contribution (EFC) changes and results in a change in the amount of the applicant's assistance under the Title IV, Higher Education Act (HEA) programs;

4. The procedures the institution will follow itself or the procedures the institution will require an applicant to follow to correct FAFSA information determined to be in error; and

5. The procedures for making referrals under 34 C.F.R. 668.16(g).

An institution's procedures must provide that it will furnish, in a timely manner, to each applicant whose FAFSA information is selected for verification a clear explanation of:

1. The documentation needed to satisfy the verification requirements; and

2. The applicant's responsibilities with respect to the verification of FAFSA information, including the deadlines for completing any actions required under Subpart E, and the consequences of failing to complete any required action.

An institution's procedures must provide that an applicant whose FAFSA information is selected for verification is required to complete verification before the institution exercises any authority under 20 U.S.C. 1087tt to make changes to the applicant's cost of attendance or to the values of the data items required to calculate the EFC.

34 C.F.R. 668.2(b), .53

Texas Application

for State Financial

Aid

The Texas Application for State Financial Aid (TASFA) collects data necessary for determining state financial aid eligibility for those applicants classified as Texas residents, as outlined in 19

Administrative Code Chapter 21, Subchapter B, who are not eligible to apply for federal financial aid using the Free Application for Federal Student Aid.

Beginning with the financial aid application cycle for academic year 2023-2024 and thereafter, the online TASFA available through the ApplyTexas website is the sole, acceptable online TASFA. All institutions participating in financial aid programs covered by 19 Administrative Code Chapter 22 must accept the data generated by the completion of this online TASFA.

Beginning with the financial aid application cycle for academic year 2023-2024 and thereafter, the TASFA document available through the ApplyTexas website is the sole, acceptable printable version of the TASFA, which institutions may accept from applicants who do not have access to the necessary technology to complete the on- line TASFA.

An institution is not prohibited from requiring an applicant to submit additional information to accompany the data received via the TASFA.

19 TAC 22.6(b)

Financial Aid

Applications

Free Application for

Federal Student Aid

Each individual seeking to apply for federal financial aid under 20

U.S.C. Chapter 28, Subchapter IV, for award year 2024-2025 and

any subsequent award year shall file a free application with the

secretary of education, known as the Free Application for Federal

Student Aid (FAFSA), to determine eligibility for such aid, as described

in 20 U.S.C. 1090(a)(2), and in accordance with 20 U.S.C.

1087ss.

The secretary of education shall enable applicants to submit a

FAFSA and initiate the processing of such application, not later

than October 1 prior to the applicant’s planned year of enrollment.

20 U.S.C. 1090(a)(1), (d)(4)(A)

Information

Provided to College

An institution:

1. Shall use the information provided to it solely for the application, award, and administration of financial aid to the applicant;

2. May use the information provided, excluding the information described under 26 U.S.C.6013(l)(13), for research that does not release any individually identifiable information on any applicant, to promote college attendance, persistence, and completion; and

3. Shall not share such educational record information with any other entity without the explicit written consent of the applicant.

20 U.S.C. 1090(a)(3)(C)

FAFSA Verification

Procedures

1. The time period within which an applicant must provide any documentation requested by the institution in accordance with 34 C.F.R. 668.57;

2. The consequences of an applicant's failure to provide the requested documentation within the specified time period;

4. The procedures the institution will follow itself or the procedures the institution will require an applicant to follow to correct FAFSA information determined to be in error; and

5. The procedures for making referrals under 34 C.F.R.668.16(g).

An institution's procedures must provide that it will furnish, in a timely manner, to each applicant whose FAFSA information is selected for verification a clear explanation of:

1. The documentation needed to satisfy the verification requirements; and

34 C.F.R. 668.2(b), .53

Texas Application

for State Financial

Aid

The Texas Application for State Financial Aid (TASFA) collects data necessary for determining state financial aid eligibility for those applicants classified as Texas residents, as outlined in 19 Administrative Code Chapter 21, Subchapter B, who are not eligible to apply for federal financial aid using the Free Application for Federal Student

Aid.

An institution is not prohibited from requiring an applicant to submit additional information to accompany the data received via the TASFA.

19 TAC 22.6(b)

Selective Service

Status

An individual may not receive a loan, grant, scholarship, or other financial assistance funded by state revenue, including federal funds or gifts and grants accepted by this state, unless the individual files the Selective Service Statement of Registration Status with the institution granting or certifying the financial assistance. The language to be used in the Selective Service Statement of Registration Status is disseminated by Coordinating Board staff to institutions of higher education, including college districts, on an annual basis. Institutions may accept documentation from the Selective Service System of an individual’s registration with the Selective Service in lieu of the required statement.

This section does not apply to:

1. A female individual if females are not subject to general selective service registration under federal law; or

2. An individual older than the maximum age at which an individual is required to be registered with the selective service system under federal law.

An individual who has demonstrated registration with the Selective Service through the Selective Service Statement of Registration Status or acceptable Selective Service System documentation is not required to file a statement of the individual’s Selective Service Status the next time the individual makes an application for financial assistance to the same institution of higher education. An individual who has not previously demonstrated registration with the Selective Service through the Selective Service Statement of Registration Status or acceptable Selective Service System documentation is required to file a statement of the individual’s selective service status the next time the individual makes an application to the entity for financial assistance or a student loan guarantee.

Education Code 51.9095(a)-(d); 19 TAC 22.3

Eligibility for

Scholarship

A person is not eligible to receive a scholarship originating from and administered by an institution of higher education, including a college district, or university system if the person is related to a current member of the governing board of the institution or system, unless:

1. The scholarship is granted by a private organization or third party not affiliated with the institution of higher education or university system;

2. The scholarship is awarded exclusively on the basis of prior academic merit;

3. The scholarship is an athletic scholarship; or

4. The relationship is not within the third degree by consanguinity or the second degree by affinity, as determined under Government Code Chapter 573, Subchapter B [see DBE].

Education Code 51.969(b); 19 TAC 4.383

Statement Required

Before receiving a scholarship originating from and administered by an institution of higher education or university system, a person must file a written statement with the institution or system indicating whether the person is related within the third degree by consanguinity or the second degree by affinity to a current member of the governing board of the institution or system. The required wording of the statement will be developed by the Coordinating Board

and will be made available to institutions via the Coordinating Board’s website.

A person commits a Class B misdemeanor if the person knowingly files a false statement.

Education Code 51.969(c), (e)-(f); 19 TAC 34.384-.385

Timely Distribution

of Funds

All institutions participating in the financial aid programs outlined in 19 Administrative Code Chapter 22 shall follow the guidelines for the timely distribution of funds.

Institutions shall disburse state student financial aid funding to a student recipient’s account or, in the case of work-study, through a paycheck, no later than three business days after receiving the funds. Undisbursed funds must be returned to the Coordinating Board no later than six business days after the receipt of funds. Gift aid and work-study funds for which a student is no longer eligible may be disbursed to a different eligible student for whom funds have not yet been requested in order to meet the timely disbursement requirement.

19 TAC 22.2(a)-(a)(1)

Return Upon

Student Ineligibility

For state student financial aid funding already disbursed to a student, except work study, institutions shall return funds to the Coordinating Board within 45 calendar days of a student becoming ineligible for the funding. Gift aid funds for which a student has been determined ineligible may be disbursed to a different eligible student for whom funds have not yet been requested in order to meet he timely determination of ineligibility requirement. In all cases, an institution must provide notification to the Coordinating Board regarding the change in student eligibility, as appropriate for the particular student financial aid program. 19 TAC 22.2(a)(2)

Return Upon

Cancellation of Aid

For state student financial aid funds already disbursed to a student, except work-study, institutions may return funds to the Coordinating Board within 120 calendar days of disbursement in situations where a student has notified the institution of his or her decision to cancel the financial aid. Gift aid funds for which a student has made the decision to cancel may be disbursed to a different eligible student for whom funds have not yet been requested in order to meet the timely cancellation requirement. In all cases, an institution must provide notification to the Coordinating Board regarding the student's decision to cancel financial aid, as appropriate for the particular student financial aid program. 19 TAC 22.2(a)(3)

Employee Trained in

Certain Student

Financial Assistance

Programs

Each institution of higher education, including each college district, shall ensure that one or more persons employed by the institution is trained:

1. In understanding state and federal student financial assistance programs available to military veterans or their family

members, especially programs specifically applicable to military veterans or their family members; and

2. In assisting military veterans and eligible family members in understanding and obtaining the benefits available under

those programs.

The employee must be available to assist military veterans and eligible family members during regular business hours at the financial aid or other office to which the person is assigned.

Education Code 56.006

Financial Assistance

Information

Information on financial assistance that the institution must publish and make readily available to current and prospective students under 34 C.F.R. Part 668, Subpart D, includes, but is not limited to, a description of all the federal, state, local, private, and institutional student financial assistance programs available to students who enroll at that institution. These programs include both need-based and non-need-based programs. The institution may describe its

own financial assistance programs by listing them in general categories.

The institution must describe the terms and conditions of the loans students receive under the Federal Family Education Loan Program, the William D. Ford Federal Direct Student Loan Program, and the Federal Perkins Loan Program.

For each program referred to above in this section, the information provided by the institution must describe:

1. The procedures and forms by which students apply for assistance;

2. The student eligibility requirements;

3. The criteria for selecting recipients from the group of eligible applicants; and

4. The criteria for determining the amount of a student's award.

The institution must describe the rights and responsibilities of students receiving financial assistance and, specifically, assistance under the Title IV, HEA programs. This description must include specific information regarding:

1. Criteria for continued student eligibility under each program;

2. Standards which the student must maintain in order to be considered to be making satisfactory progress in his or her

course of study for the purpose of receiving financial assistance; and criteria by which the student who has failed to

maintain satisfactory progress may re-establish his or her eligibility for financial assistance;

3. The method by which financial assistance disbursements will be made to the students and the frequency of those disbursements;

4. The terms of any loan received by a student as part of the student's financial assistance package, a sample loan repayment schedule for sample loans, and the necessity for repaying loans;

5. The general conditions and terms applicable to any employment provided to a student as part of the student's financial assistance package; and

6. The exit counseling information the institution provides and collects as required by 34 C.F.R. 674.42 for borrowers under the Federal Perkins Loan Program, by 34 C.F.R. 685.304 for borrowers under the William D. Ford Federal Direct Student Loan Program, and by 34 C.F.R. 682.604 for borrowers under the Federal Stafford Loan Program.

34 C.F.R. 668.42

Financial Aid

Displacement

Information

The Coordinating Board shall develop a financial aid displacement advisory for use by institutions of higher education, including college districts, under Education Code 56.0094.

Each institution of higher education shall include in the institution's admission application form or provide in the institution's admission application form a link to the Coordinating Board’s financial aid displacement advisory and, in plain language:

1. How to apply for gift aid at the institution;

2. The timeline for financial aid processes at the institution, including application deadlines, suggested deadlines to report gift aid, and other deadlines of which the institution determines a prospective student should be made aware;

3. A list of recommendations to aid a prospective student in maximizing gift aid awards, as determined by the institution;

4. A list of recommendations for a prospective student to ensure the student's gift aid will not be reduced; and

5. Contact information for an employee or office at the institution from whom a prospective student may seek advice regarding gift aid.

Education Code 56.0094(b)-(c)

Net Price Calculator

Each institution of higher education, including each college district, that receives federal funds under 20 U.S.C. Chapter 28, Subchapter IV, and 42 U.S.C. Chapter 34, Subchapter I, Part C, shall make publicly available on the institution's website a net price calculator to help current and prospective students, families, and other consumers estimate a student's individual net price at such institution of higher education. Such calculator may be a net price calculator

developed by the U.S. Department of Education; or by the institution of higher education, if the institution's calculator includes, at a minimum, the same data elements included in the calculator developed under 20 U.S.C. 1015a(h)(1).

Estimates of an individual net price determined using the net price calculator shall be accompanied by a clear and conspicuous notice:

1. Stating that the estimate does not represent a final determination or actual award of financial assistance; shall not be binding on the U.S. Secretary of Education, the institution of higher education, or the state; and may change;

2. Stating that the student must complete the FAFSA in order to be eligible for, and receive, an actual financial aid award that includes federal grant, loan, or work-study assistance under 20 U.S.C. Chapter 28, Subchapter IV, and 42 U.S.C. Chapter 34, Subchapter I, Part C; and

3. Including a link to the website of the U.S. Department of Education that allows students to access the FAFSA.

20 U.S.C. 1015a(h)(3)-(4)

Loan Debt

Disclosure

At least annually, and in an electronic format, participating higher educational institutions that enroll one or more students receiving state financial aid administered by the Coordinating Board and that receive education loan information for a student enrolled at the institution, must provide to that student certain estimates regarding

the student's education loan obligations.

A participating higher educational institution is not required to provide in any disclosure or report required under this section information regarding loans issued by a private entity.

Education Code 52.335(a), (b-1); 19 TAC 21.46(a)

Disclosure

Procedure

At least annually, a participating higher educational institution shall provide a student loan debt disclosure, as more fully defined in 19 Administrative Code 21.49 to every student who has a balance on one or more student loans, and whose debt records are received by the participating higher educational institution where he or she is enrolled. If the participating higher educational institution has a record of unpaid student loan debt, a disclosure must be provided

to that student.

Student loan debt disclosures must be sent electronically in a manner that complies with the Family Educational Rights and Privacy Act (, 20 U.S.C. 1232g; and 34 C.F.R. Part 99) and the participating higher educational institution's privacy standards.

Education Code 52.335(b); 19 TAC 21.48, .49(e)

Contents of

Disclosures

Student loan debt disclosures are required to include education loan debt information that the participating higher educational institution receives or otherwise obtains from the U.S. Department of Education's central database for student aid, currently known as the National Student Loan Data System, which is shared with institutions through the Institutional Student Information Record (ISIR), as well as information that the institution may reasonably collect from its own records.

Student loan debt disclosures must include an estimate of the unpaid amount of federal education loans obtained by the student and state education loans obtained by the student at the current institution. The types of education loans must be identified for each total included.

Student loan debt disclosures must include an estimate of the total payoff amount for education loans, or a range for that amount, including principal and interest. At a minimum, institutions shall provide this information based on a 10-year repayment plan. Student loan debt disclosures must include an estimate of the monthly repayment amount that the student may incur for the repayment of the education loans, including principal and interest. At a minimum, institutions shall provide this information based on a 10-year repayment plan.

The electronic communication of the student loan debt must explain the following:

1. The disclosure may not be a complete and official record of the student's unpaid education loan debt;

2. Why the disclosure may not be complete or accurate, including an explanation that for a transfer student, the institution's estimates regarding state loans reflect only state loans incurred by the student for attendance at the current institution, and not prior institutions; and

3. That the institution's estimates are general in nature and are not intended as a guarantee or promise.

Education Code 52.335(b)-(d); 19 TAC 21.49(a)-(d), (f)

Disclosures

Regarding Lenders

An institution of higher education, including each college district, that receives federal funding, or an institution-affiliated organization of such covered institution, that participates in a preferred lender arrangement shall disclose the information described in 20 U.S.C. 1019a.

An institution of higher education that receives federal funding, or an institution-affiliated organization of such covered institution, that provides information regarding a private education loan from a lender to a prospective borrower shall provide the information described in 20 U.S.C. 1019a.

20 U.S.C. 1019(2), 1019a(a)

Students with

Disabilities

In providing financial assistance to qualified disabled persons, a recipient of federal financial assistance may not:

1. On the basis of disability, provide less assistance than is provided to nondisabled persons, limit eligibility for assistance, or otherwise discriminate; or

2. Assist any entity or person that provides assistance to any of the recipient’s students in a manner that discriminates against qualified disabled persons on the basis of disability.

34 C.F.R. 104.46(a)(1)

A recipient may administer or assist in the administration of scholarships, fellowships, or other forms of financial assistance established under wills, trusts, bequests, or similar legal instruments that require awards to be made on the basis of factors that discriminate or have the effect of discriminating on the basis of disability only if the overall effect of the award of scholarships, fellowships, and other forms of financial assistance is not discriminatory on the basis of disability. 34 C.F.R. 104.46(a)(2)

Discrimination on

the Basis of Sex

Except as provided in 34 C.F.R. 106.37(b) and (c), in providing financial assistance to any of its students, a recipient shall not: 1. On the basis of sex, provide different amounts or types of such assistance, limit eligibility for such assistance that is of any particular type or source, apply different criteria, or otherwise discriminate;

2. Through solicitation, listing, approval, provision of facilities or other services, assist any foundation, trust, agency, organization, or person that provides assistance to any of such recipient's students in a manner that discriminates on the basis of sex; or

3. Apply any rule or assist in application of any rule concerning eligibility for such assistance that treats persons of one sex differently from persons of the other sex with regard to marital or parental status.

34 C.F.R. 106.37(a)

Records Retention

An institution shall maintain its records and accounts of all transactions related to state and federal student financial aid in keeping with the institution's records retention schedule to ensure a full accounting for all funds received, disbursed, and expended by the institution. Records and accounts shall be available for inspecting, monitoring, programmatic or financial auditing, or evaluation by the Coordinating Board, and by others authorized by law or regulation, for a period, whichever is later:

1. Not less than seven years after the date of the completion of the award period;

2. The date of the receipt of the institution's final claim for payment of final expenditure report; or

3. Until a resolution of all billing questions in connection with the account has been resolved.

Records and accounts shall include, but are not limited to, general institutional and program specific recordkeeping requirements in accordance with Federal Student Aid Title IV regulations, 34 C.F.R.668.24.

If an audit is announced, an institution shall retain its records until the audit has been completed or not less than seven years after the expiration date of the Memorandum of Understanding for State Financial Aid Programs (MOU), whichever is later.

An institution shall make available to the auditing entity all documents and other information related to state financial aid programs.

An institution and any subcontractors shall provide any information the auditing entity deems relevant to any monitoring, investigation, evaluation, or audit.

19 TAC 22.4

Note: Federal financial aid rules are found at 34 C.F.R. part 668. For technical guidance regarding the provision of

federal financial aid, visit the U.S. Department of Education Federal Student Aid (FSA) Partner Connect1 website.

State financial aid and scholarship programs, tuition set-asides, and other requirements are detailed in Education

Code Chapters 52 and 56 and 19 Administrative Code Chapters 21 and 22.

1 Federal Student Aid (FSA) Partner Connect: https://fsapartners.ed.gov

DATE ISSUED: 10/16/2025

UPDATE 50

FEA(LEGAL)-PJC