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«FINAL AUDIT REPORT ED-OIG/A07L0001 February 2014 Our mission is to promote the U.S. Department of Education efficiency, effectiveness, and Office of ...»

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Recalculation of Pell Awards Of the 50 students in our sample, Liberty University’s online learning management system or other records for 10 students indicated a change in enrollment status based on the students’ lack of academic attendance in 1 or more of their classes. The enrollment status changes for 7 of the 10 students had an effect in their Pell eligibility. However, Liberty University did not properly recalculate the Pell awards for those seven students. As a result, Liberty University awarded $6,069 more than it should have to seven students.

Liberty University disagreed that it improperly calculated the Pell awards. Liberty University stated that academically related activity for the seven students was confirmed and that it properly determined the students’ enrollment levels and correctly calculated and disbursed the students’ Pell awards. Liberty University provided us with information for the seven students so that we could confirm its position. Liberty University informed us that the information included course activity from the online learning management system and a list of academic advising and counseling or other academically related assistance applicable to the first week of the students’ courses.

We reviewed the information provided and concluded it was not sufficient evidence that the students attended an academically related activity during the payment period. As stated previously, we did not consider the course requirements checklist or the submission of discussion posts to introduce oneself to classmates to be an academically related activity because the activities covered by the checklist or the discussion posts are not related to the subject matter of the course. We did not consider technical assistance for navigating the course requirements checklist, accessing a course, and viewing a course video as academically related activities.

Such activities are administratively, not academically, related. For the students that Liberty University asserted received academic counseling on certain dates, the evidence submitted with the response did not corroborate the assertion.

Final Audit Report ED-OIG/A07L0001 Page 67 of 83 Appendix H: Western Governors University Private nonprofit school Western Governors University was incorporated in 1997 and is headquartered in Salt Lake City, Utah. The school is nationally accredited by the Distance Education and Training Council and regionally accredited by the Northwest Commission on Colleges and Universities. Western Governors University offers all its programs and courses entirely through distance education.

During award year 2010–2011, Western Governors University disbursed more than $243 million in Title IV funds to about 24,000 students.

Cost of Attendance Western Governors University’s cost of attendance budget included tuition and fees, and allowances for room and board, books and supplies, technology, travel, and personnel expenses.

Billings and Disbursements Western Governors University is a term-based school, operating on 6-month terms and charging tuition and fees by the term. Western Governors University established the 6-month term as its payment period for Title IV purposes. A student’s term may begin on the first day of any month.

For new students, Western Governors University disbursed Title IV funds 30 days after the start of the term. For continuing students, Western Governors University disbursed Title IV funds 15 days after the start of the term. Students had to meet satisfactory academic progress requirements to be eligible for disbursements for the next 6-month term.

Attendance and Withdrawal Policies Western Governors University used a process called academic activity verification to determine when a student began attending his or her courses. Early in the payment period, a student mentor would call the student to discuss the learning resources available to the student and to schedule assessment completion dates for the payment period. The student mentor did not provide educational instruction to the student, but Western Governors University considered the student mentor to be a faculty member.

During 2010–2011, Western Governors University determined a student’s last date of attendance

by reviewing its online learning management system for evidence of one of the following:

–  –  –

According to the interim provost, beginning July 1, 2011, Western Governors University no longer considered a student simply logging in to its online learning management system to be evidence of academic attendance.

Western Governors University was not required to take attendance. For students who unofficially withdrew, Western Governors University used the later of the last date of attendance as defined above or the midpoint of the payment period as the withdrawal date for the return of Title IV aid calculation.

Determination of Attendance Affects Compliance With the Title IV Requirements We identified attendance issues that affected Western Governors University’s compliance with the Title IV requirements for the treatment of Title IV funds when a student withdraws.

Western Governors University stated that the OIG, in making its determination of attendance (see “Methodology for Reviewing Student Records” in Appendix B), applied regulations that were not in effect during the audit period. Specifically, Western Governors University believed that the OIG applied the definition of attendance in 34 C.F.R. § 668.22(l)(7)(i), which did not become effective until July 1, 2011.





We disagree with Western Governors University’s position. Even before July 1, 2011, the regulations required activity supporting attendance to be academically related. Our determination of what activities were academically related was based on the regulations in effect during the audit period.

Treatment of Title IV Funds When a Student Withdraws Of the 50 students in our sample, 17 withdrew during a payment period. Western Governors University used an unsupported last date of attendance or did not perform return of Title IV aid calculations for seven students, resulting in Western Governors University returning $4,414 less than it should have returned for five students.

Western Governors University used a last date of attendance that was not supported by evidence of academically related activity for five of the seven students. In addition, Western Governors University did not perform return of Title IV aid calculations for two students. Using information recorded in Western Governors University’s online learning management system, we determined that there was a financial impact for five students and no financial impact for two of the seven students.

Western Governors University partially agreed and provided the following explanations:

• For one of the five students, Western Governors University agreed that it used an unsupported last date of attendance in the return of Title IV aid calculation.

–  –  –

academically initiated email by one student to a student mentor, and (c) one student’s last phone call with a student mentor.

• For one of the five students, Western Governors University did not agree that the student withdrew during the payment period. Western Governors University believed that the student was in continuous attendance during the term. Western Governors University stated that the student stayed in contact with his or her student mentor during the term and was constantly working on a teacher certification exam that the student was required to pass before he or she could do demonstration teaching.

We disagree with Western Governors University’s position that it used the appropriate withdrawal date for the three students. We do not agree that the activity provided as evidence of the last dates of attendance was academically related. The records for the first student showed only that the student had logged in to the online learning management system and did not indicate academic attendance. The records of the second student showed an email exchange between the student and a student mentor to schedule a phone call. The records had no evidence of a subsequent phone call. The records of the third student did not include evidence of a phone call from the student to the student mentor. Instead, on the same date, we found evidence of an email from the student mentor to the student. We did not consider these activities to be evidence that the three students attended an academically related activity on the dates Western Governors University used as the last dates of attendance.

–  –  –

ITT Tech opened in 1956 and is headquartered in Carmel, Indiana. The school is accredited by the Accrediting Council for Independent Colleges and Schools. ITT Tech offered its distance education programs through its Indianapolis, Indiana location. It offers 40 degree programs that can be completed entirely through distance education. During award year 2010–2011, ITT Tech disbursed more than $1.5 billion in Title IV funds to about 133,000 students, including about 13,000 students who were enrolled solely in distance education courses.

Cost of Attendance ITT Tech’s cost of attendance budget included tuition and fees and allowances for room and board, transportation, and miscellaneous expenses. For distance education students, ITT Tech created a separate cost of attendance budget that did not include an allowance for transportation costs.

Billings and Disbursements ITT Tech is a term-based school, operating on a quarter system and charging tuition and fees by course. ITT Tech established the quarter as its payment period for Title IV purposes. ITT Tech began a new quarter each September, December, March, and June. Every quarter was 12 weeks and courses were either 6 or 12 weeks. Because students were charged tuition and fees by course, if a student took a 6-week course during the last 6 weeks of the quarter, the student would not be charged tuition and fees until the middle of the quarter.

ITT Tech disbursed loan funds 10 days before the start of the payment period and disbursed Pell funds during the first week of the payment period. Although ITT Tech charged tuition and fees as each course began, it disbursed Title IV funds for the entire payment period, programming its financial aid system to automatically disburse the funds at the start of the payment period.

Attendance and Withdrawal Policies For students enrolled in distance education courses, ITT Tech’s attendance policy stated that attendance was recorded weekly. ITT Tech tracked attendance automatically through its online learning management system. Distance education students had to log in to the online learning management system and then access a specific course within the system to be considered attending the course. The online learning management system also tracked when a student submitted work for a learning activity within a course, but the submission date was not used to determine attendance in the course. A student’s last date of attendance was the last date that the student accessed the course in the online learning management system. The online learning management system identified distance education students as unofficial withdrawals if they had stopped attending for 11 consecutive days during a 6-week class or 22 consecutive days during a 12-week class.

–  –  –

recorded in its online learning management system as the student’s withdrawal date for the return of Title IV aid calculation.

Determination of Attendance Affects Compliance With the Title IV Requirements We identified attendance issues that affected ITT Tech’s compliance with the Title IV requirements in four areas: (1) treatment of Title IV funds when a student withdraws, (2) treatment of Title IV funds when a student does not begin attendance, (3) confirmation of eligibility at the time of disbursement, and (4) recalculation of the Pell award.

Treatment of Title IV Funds When a Student Withdraws Of the 50 students in our sample, 28 withdrew during a payment period. Using an unsupported last date of attendance resulted in ITT Tech returning $1,987 less than it should have for three students and $3,780 more than it should have for four students. The last dates of attendance for the seven students were not supported by evidence of academically related activity.

ITT Tech disagreed and believed it correctly performed the return of Title IV aid calculations.

ITT Tech stated that regulations in effect during award year 2010–2011 allowed schools to consider a student accessing the online learning management system and reviewing courserelated material to be considered academically related activity. ITT Tech stated that its determination of attendance reflected the industry’s common understanding of the Department’s regulation related to documenting attendance at an academically related activity and in effect during award year 2010–2011. In addition, ITT Tech stated that the OIG retroactively applied standards and criteria for determining attendance during the audit period. The standards and criteria did not become effective until July 1, 2011, so they cannot be applied to award year 2010–2011. Finally, ITT Tech stated that the OIG’s insertion of its own legally unsupported opinion as to what activities should be treated as academic in nature raised concerns that the OIG was asserting its influence over the school’s curriculum. Such influence is in violation of the prohibition against Federal control of education.

We disagree with ITT Tech’s position that a student’s accessing a course in the online learning management system could be considered evidence of academic attendance during the audit period. ITT Tech’s login records indicated only whether a student completed logging into the online learning management system. Therefore, ITT Tech did not maintain evidence that the student attended an academically related activity as required by 34 C.F.R. § 668.22(c)(3).

We also disagree with the statement that our interpretation of the regulation interferes with ITT Tech’s curriculum decisions. Our interpretation is not an attempt to control the school’s curriculum. We limited our work to applying the regulations in effect during the audit period and concluding whether the school maintained sufficient evidence of academic attendance.



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