Massachusetts Maritime Academy

Finding number: 2023-001 Federal agency: U.S. Department of Education Programs: Federal Direct Student Loans AL #’s: 84.268 Award year: 2023 Criteria According to 34 CFR 690.83(b): (1) An institution shall report to the Secretary any change for which a student qualifies including any related Payment Data changes by submitting to the Secretary the student’s Payment Data that discloses the basis and result of the change in award for each student. The institution shall submit the student’s Payment Data reporting to the Secretary by the reporting deadlines published by the Secretary in the Federal Register. (2) An institution shall submit, in accordance with the deadline dates established by the Secretary, through publication in the Federal Register, other reports and information the Secretary requires and shall comply with the procedures the Secretary finds necessary to ensure that the reports are correct. According to the Federal Register (Volume 83, Number 233): An institution must submit Pell Grant, Iraq and Afghanistan Service Grant, Direct Loan, and TEACH Grant disbursement records to COD, no later than 15 days after making the disbursement or becoming aware of the need to adjust a previously reported disbursement. In accordance with 34 CFR 668.164(a), Title IV, Higher Education Act (“HEA”) program funds are disbursed on the date that the institution: (a) Credits those funds to a student’s account in the institution’s general ledger or any subledger of the general ledger; or (b) pays those funds to a student directly. Title IV, HEA program funds are disbursed even if an institution uses its own funds in advance of receiving program funds from the Department.Condition Federal regulations require the Academy to report Direct Student Loan disbursements made to students to the Federal Government’s Common Origination and Disbursement System (“COD”) within 15 days of the funds being disbursed to the student. During our testing, we noted 1 student, out of a sample of 32 Direct Student Loan recipients, were not reported within the required timeframe. Cause The Academy has policies and procedures in place to report the disbursement records to the Department of Education through the COD system within the required fifteen calendar days; however, in this case the procedures were not completed properly. Effect The Academy did not report Direct Student Loan disbursements to COD within the required time frame. Questioned Costs Not applicable Perspective Our sample was not, and was not intended to be, statistically valid. Of the 32 students selected for testing, 1 student, or 3% of our sample, was determined to be reported late to the COD. Identification as a Repeat Finding, if applicable See finding 2022-001 included in the summary schedule of prior year findings. Recommendation We recommend that management of the Academy review, and if necessary, update the policies and procedures to ensure all Direct Student Loan funds are reported within the required timeframe. View of Responsible Officials The Academy agrees with the finding.

Finding number: 2023-002 Federal agency: U.S. Department of Education Programs: Federal Pell Grants AL #’s: 84.063 Award year: 2023 Criteria According to 34 CFR 690.62(a): Calculation of a Federal Pell Grant: The amount of a student's Pell Grant for an academic year is based upon the payment and disbursement schedules published by the Secretary for each award year. According to 34 CFR 690.2(c): Annual award: The Federal Pell Grant award amount a full-time student would receive under the payment schedule for a full academic year in an award year, and the amount a three-quarter time, half-time, and less-than-half-time student would receive under the appropriate disbursement schedule for being enrolled in that enrollment status for a full academic year in an award year. Disbursement Schedule: A table showing the annual awards that full-time, three-quarter, half-time, and less-than-half-time students at term-based institutions using credit hours would receive for an academic year. This table is published annually by the Secretary and is based on: (1) A student's expected family contribution, as determined in accordance with Title IV, Part F of the HEA; and (2) A student's attendance costs as defined in Title IV, Part F of the HEA. (3) The amount of funds available for making Federal Pell Grants. Condition Federal regulations require institutions to award Federal Pell Grants in accordance with the appropriate disbursement schedule for full-time, three-quarter, half-time, and less-than-half-time students based on the students’ estimated financial contribution and cost of attendance. During our testing, we noted 1 student, out of a sample of 19, that were not awarded the proper amount of Pell Grant funds.Cause The Academy did not use the students’ correct Pell disbursement schedule when awarding the student Pell Grant funds. Effect By using the incorrect schedule, the student was under awarded Federal Pell Grant funds. Questioned Costs $400 Perspective Our sample was not, and was not intended to be, statistically valid. Of the 19 students selected for testing, 1 student, or 5% of our sample, was under-awarded Pell Grant funds. Identification as a Repeat Finding, if applicable Not applicable Recommendation We recommend that management of the Academy review, and if necessary, update, the policies, and procedures for awarding aid and ensuring cost of attendances are correct to ensure Federal Pell Grant award amounts are properly calculated. Additionally, financial aid awards should be reviewed by management prior to disbursing funds to students. View of Responsible Officials The Academy agrees with the finding.

Finding number: 2022-001 Federal agency: U.S. Department of Education Programs: Federal Direct Student Loans AL #?s: 84.268 Award year: 2022 Criteria According to 34 CFR 690.83(b): (1) An institution shall report to the Secretary any change for which a student qualifies including any related Payment Data changes by submitting to the Secretary the student?s Payment Data that discloses the basis and result of the change in award for each student. The institution shall submit the student?s Payment Data reporting to the Secretary by the reporting deadlines published by the Secretary in the Federal Register. (2) An institution shall submit, in accordance with the deadline dates established by the Secretary, through publication in the Federal Register, other reports and information the Secretary requires and shall comply with the procedures the Secretary finds necessary to ensure that the reports are correct. According to the Federal Register (Volume 83, Number 233): An institution must submit Pell Grant, Iraq and Afghanistan Service Grant, Direct Loan, and TEACH Grant disbursement records to COD, no later than 15 days after making the disbursement or becoming aware of the need to adjust a previously reported disbursement. In accordance with 34 CFR 668.164(a), Title IV, Higher Education Act (?HEA?) program funds are disbursed on the date that the institution: (a) Credits those funds to a student?s account in the institution?s general ledger or any subledger of the general ledger; or (b) pays those funds to a student directly. Title IV, HEA program funds are disbursed even if an institution uses its own funds in advance of receiving program funds from the Department. Condition Federal regulations require the Academy to report Direct Student Loan disbursements made to students to the Federal Government?s Common Origination and Disbursement System (?COD?) within 15 days of the funds being disbursed to the student. During our testing, we noted 23 students, out of a sample of 25 Direct Student Loan recipients, were not reported within the required timeframe. Cause The Academy has policies and procedures in place to report the disbursement records to the Department of Education through the COD system within the required fifteen calendar days; however, in this case the procedures were not completed properly. Effect The Academy did not report Direct Student Loan disbursements to COD within the required time frame. Questioned Costs Not applicable Perspective Our sample was not, and was not intended to be, statistically valid. Of the 25 students selected for testing, 23 students, or 92% of our sample, was determined to be reported late to the COD. Identification as a Repeat Finding, if applicable See finding 2021-001 included in the summary schedule of prior year findings. Recommendation We recommend that management of the Academy review, and if necessary, update the policies and procedures to ensure all Direct Student Loan funds are reported within the required timeframe. View of Responsible Officials The Academy agrees with the finding.

Finding number: 2022-002 Federal agency: U.S. Department of Education Programs: Higher Education Relief Fund ? Institutional Portion AL #?s: 84.425F Award year: 2022 Criteria Section 18004(a)(1) of the Coronavirus Aid, Relief, and Economic Security Act required that institutions submit an Annual Report to the Department of Education that details the institution's annual expenditures accurately and that the expenditures reconcile with institution's underlying records. Condition During our testing, we noted that the Annual Report submitted by the Academy was not accurate and did not reconcile with the Academy's underlying records. The Academy reported that institutional funds were used for providing reimbursements for tuition, housing, room and board, or other fee refunds, while these funds were actually used to replace lost revenue from academic sources. Effect The Academy's Annual Report submitted to the Department of Education was not accurate. Questioned Costs Not applicable Recommendation The Academy should create procedures to ensure the Academy is in compliance with the program's reporting requirements. View of Responsible Officials The Academy agrees with the finding.

Finding number: 2021-001 Federal agency: U.S. Department of Education Programs: Federal Direct Student Loans AL #?s: 84.268 Award year: 2021 Criteria According to 34 CFR 690.83(b): (1) An institution shall report to the Secretary any change for which a student qualifies including any related Payment Data changes by submitting to the Secretary the student?s Payment Data that discloses the basis and result of the change in award for each student. The institution shall submit the student?s Payment Data reporting to the Secretary by the reporting deadlines published by the Secretary in the Federal Register. (2) An institution shall submit, in accordance with the deadline dates established by the Secretary, through publication in the Federal Register, other reports and information the Secretary requires and shall comply with the procedures the Secretary finds necessary to ensure that the reports are correct. According to the Federal Register (Volume 83, Number 233): An institution must submit Pell Grant, Iraq and Afghanistan Service Grant, Direct Loan, and TEACH Grant disbursement records to COD, no later than 15 days after making the disbursement or becoming aware of the need to adjust a previously reported disbursement. In accordance with 34 CFR 668.164(a), Title IV, Higher Education Act (?HEA?) program funds are disbursed on the date that the institution: (a) Credits those funds to a student?s account in the institution?s general ledger or any subledger of the general ledger; or (b) pays those funds to a student directly. Title IV, HEA program funds are disbursed even if an institution uses its own funds in advance of receiving program funds from the Department. Condition Federal regulations require the Academy to report Direct Student Loan disbursements made to students to the Federal Government?s Common Origination and Disbursement System (?COD?) within 15 days of the funds being disbursed to the student. During our testing, we noted 4 students, out of a sample of 33 Direct Student Loan recipients, were not reported within the required timeframe. Cause The Academy has policies and procedures in place to report the disbursement records to the Department of Education through the COD system within the required fifteen calendar days; however, in this case the procedures were not completed properly. Effect The Academy did not report Direct Student Loan disbursements to COD within the required time frame. Questioned Costs Not applicable Perspective Our sample was not, and was not intended to be, statistically valid. Of the 33 students selected for testing, 4 students, or 12% of our sample, was determined to be reported late to the COD. Identification as a Repeat Finding, if applicable See finding 2020-002 included in the summary schedule of prior year findings. Recommendation We recommend that management of the Academy review, and if necessary, update the policies and procedures to ensure all Direct Student Loan funds are reported within the required timeframe. View of Responsible Officials The Academy agrees with the finding.

Finding number: 2021-002 Federal agency: U.S. Department of Education Programs: Federal Pell Grants AL #?s: 84.063 Award year: 2021 Criteria According to 34 CFR 690.83(b): (1) An institution shall report to the Secretary any change for which a student qualifies, including any related Payment Data changes, by submitting to the Secretary the student?s Payment Data that discloses the basis and result of the change in award for each student. The institution shall submit the student?s Payment Data reporting to the Secretary by the reporting deadlines published by the Secretary in the Federal Register. (2) An institution shall submit, in accordance with the deadline dates established by the Secretary, through publication in the Federal Register, other reports and information the Secretary requires and shall comply with the procedures the Secretary finds necessary to ensure that the reports are correct. According to the Federal Register (Volume 83, Number 233): An institution must submit Pell Grant, Iraq and Afghanistan Service Grant, Direct Loan, and TEACH Grant disbursement records to COD, no later than 15 days after making the disbursement or becoming aware of the need to adjust a previously reported disbursement. In accordance with 34 CFR 668.164(a), Title IV, Higher Education Act (?HEA?) program funds are disbursed on the date that the institution: (a) Credits those funds to a student?s account in the institution?s general ledger or any subledger of the general ledger; or (b) pays those funds to a student directly. Title IV, HEA program funds are disbursed even if an institution uses its own funds in advance of receiving program funds from the Department. Condition Federal regulations require the Academy to report to the Federal Government?s Common Origination and Disbursement System (?COD?) Federal Pell Grant disbursements made to students within 15 days of the funds being disbursed to the student. During our testing, we noted 22 students, out of a sample of 24 Pell Grant recipients, were not reported within the required timeframe. Cause The Academy has policies and procedures in place to report the disbursement records to the Department of Education through the COD system within the required fifteen calendar days; however, in this case the procedures were not completed properly. Effect The Academy did not report Pell Grant disbursements to COD within the required time frame. Questioned Costs Not applicable Perspective Our sample was not, and was not intended to be, statistically valid. Of the 24 students selected for testing, 22 students, or 92% of our sample, was determined to be reported late to the COD during the Spring Semester. Identification as a Repeat Finding, if applicable Not applicable Recommendation We recommend that management of the Academy review, and if necessary, update the policies and procedures to ensure all Pell Grant funds are reported within the required timeframe. View of Responsible Officials The Academy agrees with the finding.

Finding number: 2021-003 Federal agency: U.S. Department of Education Programs: Student Financial Assistance Clusters AL #?s: 84.063, 84.268 Award year: 2021 Criteria According to 34 CFR 685.309(b)(2): Unless [the institution] it expects to submit its next updated enrollment report to the Secretary within the next 60 days, a school must notify the Secretary within 30 days after the date the school discovers that ? (i) A loan under Title IV of the Act was made to or on behalf of a student who was enrolled or accepted for enrollment at the school, and the student has ceased to be enrolled on at least a half-time basis or failed to enroll on at least a half-time basis for the period for which the loan was intended; or (ii) A student who is enrolled at the school and who received a loan under Title IV of the Act has changed his or her permanent address. The Dear Colleague Letter GEN-12-6 issued by the U.S. Department of Education (?ED?) on March 30, 2012 states that in addition to student loan borrowers, Enrollment Reporting files will include two additional groups of students: Pell Grant and Perkins Loan recipients. According to 2 CFR Part 200, Appendix XI Compliance Supplement updated April 2018: Under the Pell Grant and loan programs, institutions must complete and return within 15 days the Enrollment Reporting roster file placed in their Student Aid Internet Gateway mailboxes sent by ED via the National Student Loan Data System (?NSLDS?). The institution determines how often it receives the Enrollment Reporting roster file with the default set at a minimum of every 60 days. Once received, the institution must update for changes in student status, report the date the enrollment status was effective, enter the new anticipated completion date, and submit the changes electronically through the batch method or the NSLDS website. Institutions are responsible for timely reporting, whether they report directly or via a third-party servicer. Condition The Federal Government requires the Academy to report student enrollment changes to the National Student Loan Data System (?NSLDS?) within 60 days. During our testing, we noted 1 student, out of a sample of 40, was not reported to NSLDS within the required timeframe by 110 days. Cause The Academy did not have adequate procedures in place to ensure that students with status changes were reported to NSLDS within the required timeframe. Effect The Academy did not report the student?s status change to NSLDS within the required timeframe, which may impact the student?s loan grace periods. Questioned Costs Not applicable Perspective Our sample was not, and was not intended to be, statistically valid. Of the 40 students selected for testing, 1 student, or 2.5% of our sample, had status changes that were not reported to NSLDS within the required timeframe. Identification as a Repeat Finding, if applicable Not applicable Recommendation The Academy should provide training to employees responsible for processing information for the NSLDS and ensure that they have adequate knowledge in the related rules and regulations. This training should include an explanation of the Academy?s date of determination of withdrawal, the importance of reporting timely and the consequences of late reporting. Additionally, submission of additional rosters may reduce the likelihood of the finding in the future. View of Responsible Officials The Academy agrees with the finding.

Finding number: 2020-001 Federal agency: U.S. Department of Education Programs: Federal Direct Student Loans CFDA #?s: 84.268 Award year: 2020 Criteria According to 34 CFR 668.22(e)(4): Total amount of unearned Title IV assistance to be returned. The unearned amount of Title IV assistance to be returned is calculated by subtracting the amount of Title IV assistance earned by the student as calculated under paragraph (e)(1) of this section from the amount of Title IV aid that was disbursed to the student as of the date of the institution's determination that the student withdrew. Condition The Financial Aid Office is responsible for completing the Return of Title IV calculation to determine how much Title IV aid the student earned and how much must be returned to the Department of Education. Once the Return of Title IV calculation is completed, the Academy is responsible for adjusting the student?s billing statement and returning unearned Title IV funds through the U.S. Department of Education?s Grant Management System (?G5?). The Academy has 45 days from the date they determined the student withdrew to return any unearned portions of Title IV funds. During our testing, we noted 1 student, out of a sample of 5, where the aid returned was different than the amount correctly calculated on the Return to Title IV (?R2T4?) form. Cause The Academy has policies and procedures to ensure compliance for calculating the Title IV funds to be returned. In this instance, the Academy returned the amount of Title IV funds actually earned by the student, not the amount for the Academy to return. Effect The Academy returned insufficient Title IV funds to the Department of Education. Questioned Costs $28 Perspective Our sample was not, and was not intended to be, statistically valid. Of the 5 students selected for testing, 1 student, or 20% of our sample, had the incorrect amount of Title IV funds returned. Identification as a Repeat Finding, if applicable See finding 2019-002 included in the summary schedule of prior year findings. Recommendation The Academy should review their current policies and procedures to ensure the amount of federal aid returned agrees with the amount calculated on the R2T4 form. View of Responsible Officials The Academy agrees with the finding.

Finding number: 2020-002 Federal agency: U.S. Department of Education Programs: Federal Direct Student Loans CFDA #?s: 84.268 Award year: 2020 Criteria According to 34 CFR 690.83(b): (1) An institution shall report to the Secretary any change for which a student qualifies including any related Payment Data changes by submitting to the Secretary the student?s Payment Data that discloses the basis and result of the change in award for each student. The institution shall submit the student?s Payment Data reporting to the Secretary by the reporting deadlines published by the Secretary in the Federal Register. (2) An institution shall submit, in accordance with the deadline dates established by the Secretary, through publication in the Federal Register, other reports and information the Secretary requires and shall comply with the procedures the Secretary finds necessary to ensure that the reports are correct. According to the Federal Register (Volume 83, Number 233): An institution must submit Pell Grant, Iraq and Afghanistan Service Grant, Direct Loan, and TEACH Grant disbursement records to COD, no later than 15 days after making the disbursement or becoming aware of the need to adjust a previously reported disbursement. In accordance with 34 CFR 668.164(a), Title IV, Higher Education Act (?HEA?) program funds are disbursed on the date that the institution: (a) Credits those funds to a student?s account in the institution?s general ledger or any subledger of the general ledger; or (b) pays those funds to a student directly. Title IV, HEA program funds are disbursed even if an institution uses its own funds in advance of receiving program funds from the Department. Condition Federal regulations require the Academy to report Direct Student Loan disbursements made to students to the Federal Government?s Common Origination and Disbursement System (?COD?) within 15 days of the funds being disbursed to the student. During our testing, we noted 7 students, out of a sample of 40, were not reported within the required timeframe by 10-19 days. Cause The Academy has policies and procedures in place to report the disbursement records to the Department of Education through the COD system within the required fifteen calendar days; however, in this case the procedures were not completed properly. Effect The Academy did not report Direct Student Loan disbursements to COD within the required time frame. Questioned Costs Not applicable Perspective Our sample was not, and was not intended to be, statistically valid. Of the 40 students selected for testing, 7 students, or 17.5% of our sample, was determined to be reported late to the COD by 10-19 days. Identification as a Repeat Finding, if applicable Not applicable Recommendation We recommend that management of the Academy review, and if necessary, update the policies and procedures to ensure all Direct Student Loan funds are reported within the required timeframe. View of Responsible Officials The Academy agrees with the finding.

Finding number: 2019-001 Federal agency: U.S. Department of Education Programs: Federal Pell Grants Federal Direct Student Loan CFDA #?s: 84.063, 84.268 Award year: 2019 Criteria According to 34 C.F.R. Section 685.309(b)(2): A school shall, unless it expects to submit its next student status confirmation report to the Secretary within the next sixty days, notify the Secretary within thirty days if it discovers that a Direct Subsidized, Direct Unsubsidized, or Direct PLUS Loan has been made to or on behalf of a student who: i. Enrolled at that school but has ceased to be enrolled on at least a half-time basis ii. Has been accepted for enrollment at that school but failed to enroll on at least a half-time basis for the period for which the loan was intended iii. Has changed his or her permanent address The Dear Colleague Letter GEN-12-6 (the ?Letter?) issued by the U.S. Department of Education on March 30, 2012 states that in addition to student loan borrowers, Enrollment Reporting files will include two additional groups of students: Pell Grant and Perkins Loan recipients. According to 34 CFR 668.22(c): For purposes of this section, for a student who ceases attendance at an institution that is not required to take attendance, the student?s withdrawal date is; i. The date, as determined by the institution, that the student began the withdrawal process prescribed by the institution; ii. The date, as determined by the institution, that the student otherwise provided official notification to the institution, in writing or orally, of his or her intent to withdraw; iii. If the student ceases attendance without providing official notification to the institution of his or her withdrawal in accordance with paragraph (c)(1)(i) or (c)(1)(ii) of this section, the mid-point of the payment period (or period of enrollment, if applicable). Condition The Federal Government requires the Academy to report student enrollment changes to the National Student Loan Data System (?NSLDS?) within sixty days with an accurate effective date. Out of a sample of 40 students with enrollment changes, we noted one student's effective date was reported incorrectly to the NSLDS and three students' enrollment changes were not reported to the NSLDS within sixty days. Cause The Academy reports student enrollment status changes to the NSLDS through the National Student Clearinghouse (?NSC?), a third-party contractor, and is responsible for ensuring that student enrollment status changes are reported to the NSLDS in a timely manner. It is the responsibility of the Registrar to accurately submit the enrollment status changes to NSC and to ensure that controls are in place to timely submit updates once the Registrar's office receives a student withdrawal form. The Registrar?s office did not report the student enrollment status changes accurately and timely. Effect Student enrollment status changes were not accurately reported within the required timeframe. Questioned Costs Not applicable Perspective Our sample was not, and was not intended to be, statistically valid. Of 40 students selected for testing, four students or 10% of the total sample, were improperly reported to the NSLDS, either untimely or with an incorrect effective date. Identification as a Repeat Finding, if applicable See finding 2018-001 included in the summary schedule of prior year audit findings. Recommendation We recommend that the Academy develop methods to mitigate any delays in reporting to the NSLDS. In addition, the Academy should implement a review process which ensures that student status information is accurate before submitting the student roster file. Furthermore, additional emphasis should be made on reporting the proper effective date. Views of Responsible Officials The Academy concurs with the auditors? finding.

Finding number: 2019-002 Federal agency: U.S. Department of Education Programs: Federal Direct Student Loans CFDA #?s: 84.268 Award year: 2019 Criteria According to 34 CFR 668.22(f)(2): (i) The total number of calendar days in a payment period or period of enrollment includes all days within the period that the student was scheduled to complete, except that scheduled breaks of at least five consecutive days are excluded from the total number of calendar days in a payment period or period of enrollment and the number of calendar days completed in that period. (ii) The total number of calendar days in a payment period or period of enrollment does not include ? (A) Days in which the student was on an approved leave of absence; or (B) For a payment period or period of enrollment in which any courses in the program are offered in modules, any scheduled breaks of at least five consecutive days when the student is not scheduled to attend a module or other course offered during that period. Condition The Federal Government requires that when the student withdraws from all classes, the Academy calculate the student?s percentage of Title IV aid earned. This is calculated by dividing the number of days the student attended classes by the total number of days in the academic period. The total number of days in the academic period (semester) includes all calendar days between the start and end of academic activities. During our testing, we noted 1 student, out of a sample of 1, where the incorrect number of total days in the Fall semester was used to calculate the student's percentage of Title IV earned. Cause The Academy has policies and procedures to ensure compliance for calculating the Title IV funds to be returned. In this instance, the Academy incorrectly calculated the enrollment period. Effect This caused an incorrect percentage earned to be used to calculate the student?s refund and caused the Academy to return insufficient Title IV funds to the Federal Government. Questioned Costs $156 Perspective Our sample was not, and was not intended to be, statistically valid. Of one student selected for testing, one student or 100% of the total sample was determined to have an improper refund calculated. In total, the Academy had only eight students withdraw during the year. Identification as a Repeat Finding, if applicable See finding 2018-002 included in the summary schedule of prior year findings. Recommendation The Academy should review closely the completion of R2T4 forms and ensure that total days for each semester used for students is the accurate number of days for the semester Views of Responsible Officials The Academy concurs with the auditors? finding.