Now that the Sept. 9, 2017 deadline for submitting ISIR corrections for the 2016-17 award year is here, what consequences of the 399 code are here as well?
Schools should have made reasonable efforts to obtain documentation within a reasonable timeframe, resolve the 399 code, and submit any necessary corrections to 2016-17 ISIRs by the September 9 deadline. As is always the case, schools should not have tried to circumvent any Title IV administrative requirements, for example by deliberately delaying the resolution process to run out the corrections deadline. However, reasonable efforts do recognize the constraints of normal business practices. As a result, some requests for documentation will not have been made before the September 9 deadline, some will have been made before Sept. 9, 2017 but have deadlines for submission of documentation that fall after Sept. 9, 2017, and some will have been made in time to receive the documentation but not in time to assess and process corrections by Sept. 9, 2017.
NASFAA’s understanding of the most current ED guidance is as follows:
Example #1: The school received a 399-flagged ISIR in late August, sent the request for documentation, and gave the student 45 days to comply. The school receives the requested documentation within the school’s 45-day deadline but after Sept. 9, 2017. No action for 2016-17 is required and the student’s 2016-17 aid stands.
Example #2: The school received a 399-flagged ISIR in early August, sent the request for documentation within a week, and gave the student 45 days to comply. The school receives the requested documentation on Sept. 9, 2017 (within the school’s 45-day deadline), but under the school’s normal business practices it takes 3 business days to make corrections. No action for 2016-17 is required and the student’s 2016-17 aid stands.
Example #3: The school receives a 2017-18 ISIR with the 399 code on 9/3/17. If it normally takes the school a week to draw down the ISIR, examine it, and send out requests for documentation, this student’s 2016-17 aid won’t be affected because the school could not reasonably get the request out by Sept. 9, 2017 within the school’s normal business practices.
In all three examples, the school must still resolve any differences in data for 2017-18. In all cases, the school should determine what are reasonable deadlines and reasonable business practices. NASFAA recommends that the school’s determination of “reasonable” with regard to 399 activity be documented in its policies and procedures.
If the student does not comply with the request for documentation by the school’s deadline, regardless of whether the deadline falls before or after Sept. 9, 2017, that student’s 2016-17 aid is forfeit and the student owes an overpayment.
If the student never submitted the documentation but the school did not give the student a deadline for submission of documentation to resolve the 399 code, the student still loses 2016-17 aid after Sept. 9, 2017 since the school is unable to resolve the conflicting information. The school should consider what would be reasonable action to take in those cases. For example, a school could opt to repay Title IV aid on the student’s behalf so that the student owes an institutional debt rather than a federal debt, thus preserving the student’s Title IV eligibility for 2017-18. If the school followed up with the student several times in different formats to prompt action and still got no response, it might decide to leave repayment of the 2016-17 aid as the student’s responsibility. There is no formal guidance in this case, but the school should still make an effort to determine reasonable treatment within its ability.
For additional guidance and information on withdrawn students or those no longer enrolled and conflicting information, please see the FAFSA and DRT FAQ question 12 and GEN-16-14: 2017-2018 Early FAFSA - Identification and Resolution of Conflicting Information.
Publication Date: 9/8/2017