AUTHORIZATION:

Higher Education Act of 1965, as amended, , Executive Order Title IV, Part A, Subpart 4.

OBJECTIVES:

To provide grants to States for use in programs of financial assistance to eligible postsecondary students.

TYPES OF ASSISTANCE:

Formula Grants Place Cursor Here for Definition

USES AND USE RESTRICTIONS:

To make grants of up to $5,000 for full-time (reduced for less than full-time) attendance to students with substantial financial need who are enrolled at postsecondary institutions. This program is subject to non-supplanting requirements and must use a restricted indirect cost rate that is referenced under 34 CFR 76.564-76.569. For assistance call the Office of the Chief Financial Officer/Indirect Cost Group at (202) 708-7770.

ELIGIBILITY REQUIREMENTS:

Applicant Eligibility:   The agency responsible for administering each State's need-based scholarship/grant program. U.S. Territories are also eligible to apply.

Beneficiary Eligibility:   Postsecondary education students with substantial financial need will benefit.

Credentials/Documentation:   A State application reviewed and approved annually by the Secretary of Education qualifies the State for funds. States pay administrative costs. This program is excluded from coverage under OMB Circular No. A-87.

Pre-application Coordination:   For technical assistance for States regarding the State application, refer to ED Form 1288. Environmental impact information is not required for this program. This program is excluded from coverage under E.O. 12372.

Application Procedure:   This program is excluded from coverage under OMB Circular No. A-102. This program is excluded from coverage under OMB Circular No. A-110. The designated State student scholarship or grant assistance agency in each State annually applies for State allotments/reallotments of funds; refer to ED Form 1288. Eligible students annually apply to their State of residence for a grant under this program, if the State has received an allotment. Student applicants must follow the application procedures as directed by each State and must demonstrate substantial financial need to receive a grant.

Award Procedure:   The Federal Student Aid office awards grants to State student scholarship or grant assistance agencies for making grants or providing work-study financial assistance to students.

Deadlines:   Contact the headquarters or regional office, as appropriate, for application deadlines.

Range of Approval/Disapproval Time:   

From 30 to 60 days. From 30 to 45 days.

Appeals:   

Appeals of final disapprovals can be made to the Secretary and may be subject to judicial review.

Renewals:   

New State applications are required annually.

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ASSISTANCE CONSIDERATIONS:

Formula and Matching Requirements:   

Statutory Formula: Title IV, Part A, Subpart 4. Matching Requirements: Each State receives an allotment and possibly a reallotment of funds based upon the number of students it deems eligible to participate in the program relative to the total number of such students in all States; no State receives less than its fiscal year 1979 allotment (Section 415B(a)(1), HEA). Maintenance of effort (MOE) requirements provide that annual State-appropriated expenditures in the program must not be less than the average for the previous three fiscal years (Section 415C(b)(8), HEA). States match Federal funds on at least their MOE level, but not less than a one-to-one basis, out of resources appropriated by the State which represent additional State grant expenditures over an established base year, defined as the second year before the State entered the LEAP Program (Section 415C(b)(6), HEA). This program has MOE requirements, see funding agency for further details.

Length and Time Phasing of Assistance:   

Funds are awarded for use by participating States for one award year at a time following the year of application. See the following for information on how assistance is awarded/released: Electronic transfer.

POST ASSISTANCE REQUIREMENTS:

Reports:   Annual fiscal performance report (ED Form 1288-1) and other reports as required by the Secretary. No cash reports are required. No progress reports are required. No expenditure reports are required. No performance monitoring is required.

Audits:   In accordance with the provisions of OMB Circular No. A-133 (Revised, June 27, 2003), "Audits of States, Local Governments, and Non-Profit Organizations," nonfederal entities that expend financial assistance of $500,000 or more in Federal awards will have a single or a program-specific audit conducted for that year. Nonfederal entities that expend less than $500,000 a year in Federal awards are exempt from Federal audit requirements for that year, except as noted in Circular No. A-133. Records are examined by State or Federal auditors.

Records:   States must maintain records sufficient to identify student grants awarded in compliance with the program statute and requirements concerning the expenditure of Federal funds and matching State appropriated funds. Records must be retained for three years or until completion of Department audit, whichever is later.

FINANCIAL INFORMATION:

Account Identification:  

91-0200-0-1-502.

Obligations:   (Formula Grants) FY 08 $63,852,000; FY 09 est $63,852,000; FY 10 est $63,852,000

Range and Average of Financial Assistance:  

Maximum student award is $5,000; Average student award is $1,000.

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