FEDERAL PERKINS LOAN REVOLVING FUND DISTRIBUTION OF ASSETS TIMELINE FOR 2020–21 AND REIMBURSEMENT FOR PERKINS LOAN SERVICE CANCELLATIONS

FEDERAL PERKINS LOAN REVOLVING FUND DISTRIBUTION OF ASSETS AND TIMELINES FOR 2018–19

If your school participated in the Federal Perkins Loan Program and continues to service their loans either in house or through a third-party servicer, keep an eye open in December for a notification from ED. The Department will be notifying schools that have cash in their Perkins Fund subject how much to of their federal and institutional shares need to be returned to the Department and how much gets distributed to the institution.  The Department will send a notification to institutions that have cash in their Perkins Fund as reported on the most recent FISAP. Institutions should NOT remove and return any funds to the Department or the institution until the institution has been notified to do so.

The Department will also notify institutions of the amount of partial reimbursement for Perkins Loan service cancellations the institution must remove from the Perkins Fund and return to the institution prior to the deadline. Click here to read the entire Electronic Announcement.

ED also released updated Federal Perkins Loan Data Provider Instructions. Schools participating in the Federal Perkins Loan (Perkins Loan) Program are required to report detailed loan information to NSLDS. This manual explains Perkins Loan reporting requirements and the processes used to add or update Perkins Loans on NSLDS, including how to use the Perkins DataPrep software. The updated manual, dated October 2020, replaces the June 2018 version.

UPDATE ON PERKINS LOAN ASSET DISTRIBUTION AND REIMBURSEMENT

In an electronic announcement from the U.S. Department of Education’s Office of the Under Secretary, ED announced that they will be reimbursing institutions for the institutional share of Perkins Loan Service Cancellations from the Perkins fund later this year. Before the end of the year ED is expected to send a letter to institutions participating in the Perkins Loan Program information about the specific amounts, what procedures to follow and the applicable deadlines. Institutions should not remove and return any funds to the Department or the institution until the institution has been notified to do so. More information is in this electronic announcement.

FSA TO DELAY DISTRIBUTION OF ASSETS FOR FEDERAL PERKINS LOAN PROGRAM

At last year’s Federal Student Aid Conference, Department officials announced that institutions were not required to return the federal share of their Perkins Loan Fund because the Department was still exploring ways to reimburse institutions for their Federal Perkins Loan Service Cancellations. In a recent announcement FSA stated that institutions should not remove the institutional share from their Perkins Loan Fund and return it to their institution either.

FSA is instructing institutions to forgo reporting repayment of any federal share or institutional share in its next Fiscal Operations Report and Application to Participate (FISAP) due October 1, 2019. The amounts in both the “Repayment of Fund capital to federal government” in Part III, Section A, Line 28 and “Distribution of excess/liquid fund capital” in Part III, Section A, line 30.2 should be the same amounts as the institution reported on the FISAP submitted by October 1, 2018. Note: Institutions that have already returned the federal share of their Perkins Fund to the Department and removed their institutional share from the Perkins Fund for the 2018–19 Award Year should report these repayments on the FISAP.