NMU's Compliance Database - Northern Michigan University

The Secretary considers an institution to have that administrative capability if the institution— (a) Administers the Title IV, HEA programs in accordance with all statutory provisions of or applicable to Title IV of the HEA, all applicable regulatory provisions prescribed under that statutory authority, and all applicable special arrangements, agreements, and limitations entered into under the authority of statutes applicable to Title IV of the HEA; (b)(1) Designates a capable individual to be responsible for administering all the Title IV, HEA programs in which it participates and for coordinating those programs with the institution’s other Federal and non-Federal programs of student financial assistance. The Secretary considers an individual to be ‘‘capable’’ under this paragraph if the individual is certified by the State in which the institution is located, if the State requires certification of financial aid administrators. The Secretary may consider other factors in determining whether an individual is capable, including, but not limited to, the individual’s successful completion of Title IV, HEA program training provided or approved by the Secretary, and previous experience and documented success in administering the Title IV, HEA programs properly; 

(2) Uses an adequate number of qualified persons to administer the Title IV, HEA programs in which the institution participates. The Secretary considers the following factors to determine whether an institution uses an adequate number of qualified persons— (i) The number and types of programs in which the institution participates; (ii) The number of applications evaluated; (iii) The number of students who receive any student financial assistance at the institution and the amount of funds administered; (iv) The financial aid delivery system used by the institution; (v) The degree of office automation used by the institution in the administration of the Title IV, HEA programs; (vi) The number and distribution of financial aid staff; and (vii) The use of third-party servicers to aid in the administration of the Title IV, HEA programs; (3) Communicates to the individual designated to be responsible for administering Title IV, HEA programs, all the information received by any institutional office that bears on a student’s eligibility for Title IV, HEA program assistance; and (4) Has written procedures for or written information indicating the responsibilities of the various offices with respect to the approval, disbursement, and delivery of Title IV, HEA program assistance and the preparation and submission of reports to the Secretary; (c)(1) Administers Title IV, HEA programs with adequate checks and balances in its system of internal controls; and (2) Divides the functions of authorizing payments and disbursing or delivering funds so that no office has responsibility for both functions with respect to any particular student aided under the programs. For example, the functions of authorizing payments and disbursing or delivering funds must be divided so that for any particular student aided under the programs, the two functions are carried out by at least two organizationally independent individuals who are not members of the same family, as defined in §668.15, or who do not together exercise substantial control, as defined in §668.15, over the institution; (d)(1) Establishes and maintains records required under this part and the individual Title IV, HEA program regulations; and (2)(i) Reports annually to the Secretary on any reasonable reimbursements paid or provided by a private education lender or group of lenders as described under section 140(d) of the Truth in Lending Act (15 U.S.C. 1631(d)) to any employee who is employed in the financial aid office of the institution or who otherwise has responsibilities with respect to education loans, including responsibilities involving the selection of lenders, or other financial aid of the institution, including— (A) The amount for each specific instance of reasonable expenses paid or provided; (B) The name of the financial aid official, other employee, or agent to whom the expenses were paid or provided; (C) The dates of the activity for which the expenses were paid or provided; and (D) A brief description of the activity for which the expenses were paid or provided. (ii) Expenses are considered to be reasonable if the expenses— (A) Meet the standards of and are paid in accordance with a State government reimbursement policy applicable to the entity; or (B) Meet the standards of and are paid in accordance with the applicable Federal cost principles for reimbursement, if no State policy that is applicable to the entity exists. (iii) The policy must be consistently applied to an institution’s employees reimbursed under this paragraph; (e) For purposes of determining student eligibility for assistance under a title IV, HEA program, establishes, publishes, and applies reasonable standards for measuring whether an otherwise eligible student is maintaining satisfactory academic progress in his or her educational program. The Secretary considers an institution’s standards to be reasonable if the standards are in accordance with the provisions specified in §668.34.

The University acts as a fiduciary in administering Title IV, HEA programs. Failure to administer the program or account for the funds received under that program in accordance with the highest standard of care and diligence constitutes grounds for:

1) An emergency action;

2) a fine (up to $27,500 per violation); or

3) limitation, suspension, or termination of the institution's participation in that program.