Posted Date: September 23, 2010

Author:  Jeff Baker, Director, Policy Liaison and Implementation, Federal Student Aid

Subject: Use of State Scholarships and Grants as the Non-Federal Share of FSEOG Awards for the 2010-2011 Award Year

The Higher Education Act of 1965, as amended, provides that the Federal share of awards made to students under the Federal Supplemental Educational Opportunity Grant (FSEOG) Program may not exceed 75 percent. The 25 percent non-Federal share of FSEOG awards must come from an institution's own resources, including institutional scholarships and grants, tuition or fee waivers, State scholarships and grants, and foundation or other charitable organization funds. In response to inquiries concerning the use of State scholarships for FSEOG matching purposes, the Department has determined that all State scholarships and grants, except for Leveraging Educational Assistance Partnership (LEAP) and Special Leveraging Educational Assistance Partnership (SLEAP) awards, are eligible funds that may be used to meet the non-Federal share requirement for the FSEOG Program. LEAP and SLEAP awards, for this purpose, are defined as the LEAP and SLEAP Federal allocations plus the minimum required State-matching amounts. The balance of State grant amounts generally are considered non-LEAP and non-SLEAP awards and can be used to meet the FSEOG non-Federal share requirement.

We used the State grant agency reported expected expenditures for State scholarships and grants for the 2010-2011 award year, the 2010-2011 LEAP and SLEAP allocation amounts, and the required matching information to compute the percentages of State scholarships and grants that may be used to provide the non-Federal share of total FSEOG awards for the 2010-2011 award year. A chart showing these percentages is attached. You can apply the appropriate State percentage to the State scholarships and grants your eligible FSEOG recipients received to determine the total amount of State scholarships and grants that may be used to meet the FSEOG non-Federal share requirement. For example, a student recipient of FSEOG receives a grant of $1,000 from the State of Alabama. The Alabama percentage of 74.95 multiplied by the grant amount of $1,000 equals $750, which is the portion of the grant that may be used to meet the non-Federal share requirement for a $3,000 FSEOG award ($2,250 is the Federal share of the FSEOG award).

The following are some circumstances when an institution may not use the percentages provided in the attached chart:

  • If an institution has specific knowledge that a State scholarship or grant - irrespective of its name - is considered to be made up of all LEAP funds (Federal and required State matching), no part of that scholarship or grant may be used as the FSEOG non-Federal share:
  • If an institution has documented knowledge that a State scholarship or grant is not comprised of LEAP funds (Federal and required State matching), 100 percent of the scholarship or grant may be used as the FSEOG non-Federal share:
  • If the State agency specifies the exact amount or percentage of LEAP funds included in an individual student’s State scholarship or grant, only the specified amount or percentage of the student’s State scholarship or grant up to the lesser of $12,500 or the student's cost of attendance for an academic year (the statutory maximum LEAP award) is considered LEAP funds. Any amounts of a student’s award in excess of the lesser of $12,500 or the student’s cost of attendance are not considered LEAP funds and may be used as the FSEOG non-Federal share:
  • If the State agency does not specify the amount of LEAP funds included in a student’s individual scholarship or grant but does specify the percentage of LEAP funds in the entire amount of State scholarship or grant funds provided to the institution, the institution must apply this percentage to the individual student’s total State scholarship or grant to determine the amount of the scholarship or grant up to the lesser of $12,500 or the student’s cost of attendance for an academic year to be considered LEAP funds. Any amounts of a student’s award in excess of the lesser of $12,500 or the student’s cost of attendance are not considered LEAP funds and may be used as the FSEOG non-Federal share:

These policies also apply to the SLEAP Program, except that there is no maxi­mum award.

While the Department does not require States to notify institutions of Federal and State matching funds that are part of State scholarships or grants, States must identify and notify eligible students that scholarships or grants are LEAP scholarships or grants funded by the Federal government, the State, and, where applicable, other contributing part­ners. Depending on how the State notifies students, this information does not necessarily constitute identifying whether a student’s grant includes Federal and State matching funds.

Also, States are now able to use funds other than their appropriated funds to meet their match of the Federal funds for the LEAP and SLEAP programs. If, for example, these funds include public institution tuition revenue disbursed as need-based grant aid to students, these matching funds would be considered part of the Federal LEAP and SLEAP programs and may not be used as the FSEOG non-Federal share.

For additional information or if you have questions, please contact Greg Gerrans of our staff at 312-730-1506 or the Campus-Based Call Center at 877-801-7168. Customer service representatives are available Monday through Friday from 8:00 A.M. until 8:00 P.M. (ET). You may also e-mail CBFOB@ed.gov.

Attachments/Enclosures:

Percentages of State Scholarships and Grants That May Be Used as the Non-Federal Share of FSEOG Awards for the 2010-2011 Award Year in PDF Format, 157KB, 1 Page

   

End of Page