The original Return of Funds Policy (Version A) that was included in the first draft of the Policy and Procedure Manual is printed below:

Version A - The percentage of the total enrollment period the student spends in school equals the amount of aid the student is eligible to keep. For example, there are 100 days in the enrollment period. The student attends classes for 30 of the 100 days. This is 30% of the total enrollment period. This means that the student can keep 30% of the funds that HEAB distributed. 70% of the funds must be returned according to the refund policy. During the first 60% of the total enrollment period, a student earns HEAB funds in direct proportion to the length of time he/she remains enrolled. A student who remains enrolled beyond the 60% point earns all aid for the period. The school should use the federal Return of Title IV Funds definitions when calculating a student's withdrawal date. "Withdrawal" for a school that is required to take attendance is defined as the date taken from attendance records. In some cases a student may remain enrolled but drop credits to the point that he/she is no longer eligible for the aid received from HEAB for a particular program. If this occurs, the same calculation should be used. In some cases this may result in a calculation where more money is returned than the school has available. HEAB expects that the total amount due for refund be returned and for the school to collect the money owed from the student.

Based on discussions with the Wisconsin Association of Student Financial Aid Administrators (WASFAA) State Issues Committee we came to an agreement that the following was an acceptable compromise compared to the original draft (Version A) of the policy:

Version B - Each institution shall have a fair and equitable refund policy that addresses the return of state funds when a student withdraws from the institution prior to the end of the institutionally-determined refund period. State aid programs will have priority for any credit balance remaining from an institutional refund after the federal Return of Title IV Funds requirements are satisfied.

Based on the feedback received after Version B was sent to the WASFAA community, I was asked to review the following revised language:

Version C - Each institution shall have a fair and equitable refund policy that addresses the return of state funds when a student withdraws from the institution prior to the end of the institutionally determined refund period. State aid programs will have priority for any credit balance remaining from an institutional refund after the federal Return of Title IV Funds requirements are satisfied. The amount of state grant refunded shall not exceed the 'unearned' percentage of the grant, consistent with the 'unearned' percentage of federal funds.

After discussions and after reviewing 15 examples that were provided, I understood the concern that the compromise Version B penalized the student who has paid their bill versus the student who has left the balance unpaid. I believe the revised language that was submitted in Version C does address this concern.

RECOMMENDATION: Approve Version C.