Houston City CollegeHigher Education

#2021-001 Compliance Requirement: Activities Allowed or UnaIIowed Federal Program: Texas Higher Education Coordinating Board (THECB):Governor's Emergency Education Relief (GEER) Fund -COVID-19 Award Numbers: ALN 84.425C 23510, ALN 84.425C 24088 Type of Finding: Compliance and Internal Control Over Compliance Criteria: The grant agreement indicates the specific allowable activit ies. The purpose of the Emergency Educational Grant is to provide financial relief to victims of the pandemic emergency through federally-funded educational grants that keep Texans on track to attaining high-value educational credentials. To be eligible to receive an Emergency Education Grant from an institution, a student shall: 1. be a Texas resident as defined by Board rules; 2. have filed a Free Application for Federal Student Aid for the 2020-2021 academic year; 3. be eligible for Title IV federa l student financial aid; 4. show financial need, as defined by Board rules; 5. have suffered a financial impact due to the COVID-19 pandemic as determined by the institution; 6. be enrolled in coursework leading to an associate or baccalaureate degree or undergraduate certificate program at an eligible institution; and 7. have either: a) graduated from high school between September 1, 2019 and August 31, 2020; or b) have been enrolled in coursework at an eligible institution during the 2019-2020 academic var. Condition: For 1 of 20 students tested, the student did not meet the requirement of either being graduated from high school between September 1, 2019 and August 31, 2020 and being enrolled in coursework at an eligible institution during the 2019- 2020 academic yar. Cause: Human error. Criteria for the one-time grant was very specific as to when a student was in school prior to enrolling in HCC. The administrator who awarded the funds missed the fact that the student was not enrolled during the 19-20 timeframe. No further funding from this program has been or will be received. Funds will need to be returned to the Texas Higher Education Coordinating Board. Effect: The System awarded a student that did not meet the requirements in accordance with the grant agreement between THECB and the System. Questioned Costs: $2,000 Repeat Finding: No Recommendation: We recommend for the System to have a consistently applied system of monitoring or periodic reviews to comply with GEER funding requirements. Views of Responsible Official: Due to the timing in which the funds were received (middle of pandemic in which numerous programs funds were being received), the short timeframe to award the funds, and targeted criteria for identifying eligible students, the funds were awarded to students manually. Students were manually identified through our emergency aid application process, criteria manually checked, and awarded manually. Most grant programs are administered systematically through programs identifying eligible recipients and awarding through batch processing. As a result of the manual processes for the GEER funds, a human error was made which overlooked the past enrollment criteria.

III. Federal and State Award Findings and Questioned Costs This section identifies material weaknesses, significant deficiencies, and instances of non-compliance, including questioned costs, as required by Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirement, Cost Principles, and Audit Requirement for Federal Awards, Section 200.516 Audit Findings. #2020-001 Compliance Requirement: Special Test and Provision - Return of Title IV (R2T4) Funds Federal Program: Student Financial Aid (SF A) Cluster Award Numbers: CFDA 84.007 P007A184037, CFDA 84.033 P033A184037, CFDA 84.063 P063P183363, CFDA 84.268 P268K193363, CFDA 84.379 P379T193363 Type of Finding: Compliance and Internal Control Over Compliance Criteria: 34 CFR 668.22 - Treatment of Title IV funds when a student withdraws requires Title IV funds to be deposited or transferred into the Student Financial Assistance account or electronic fund transfers initiated to the Department of Education as soon as possible, but no later than 45 days after the date the institution detemtines that the student withdrew. Condition: For 1 out of 40 students tested the return of Title IV funds occurred after 45 days. Cause: Human error Effect: The System did not make the return of Title IV funds in accordance with 34 CFR 668.22. Questioned Costs: None Repeat Finding: No Recommendation: We recommend for the System to have a consistently applied system of monitoring to meet the return of Title IV fund requirements. Views of Responsible Official: Houston Community College has a monitoring system in place that requires all R2T4 calculations to be completed within 2 weeks of the student withdrawing from all classes or the date it was determined that the student stopped attending. All returns to the COD system are required by staff to be completed within 4 weeks of the withdrawal determination date. R2T4 records populate each processors workflow the day follow the withdrawal determination date. Two senior associates in the processing center monitor the workflows and conduct monthly audits of all R2T4 calculations and returns completed the prior month and immediately notify each processor if there are issues or problems identified. The process works well and provides a number of checks and balances to ensure that the R2T4 calculations are done accurately and timely. Continuous training is provided to the processors by the Senior Associates and the Director of Financial Aid Processing. When COVID-19 was declared a national emergency, the Department of Education put out a number of regulatory relief and waivers that included the Return of Title IV Funds. The regulatory changes were released with the passing of the CARES Act with guidance provided weeks after the passing of the regulatory relief package. Higher Education institutions were provided with the following regulatory relief and were given the option to complete the calculations but hold off on returning the funds until specific guidance was released. As we were working to implement processes and procedures to identify those affected by COVID-19 and those who were not, this student was overlooked (human error) due to the timing of the withdrawal and when we were notified that the student stopped attending the class(es). The student had stopped attending and the faculty member determined and reported on 4/09/20 that the student stopped attending in Februaiy. The determination date happened after the COVID-19 emergency was declared but the student stopped attending prior to the school closure on March 13, 2020. This caused the student's record to be part of the COVID-19 review records. It was determined that the student did not qualify for the R2T 4 relief early summer but the processor forgot to finish the process on the student's record. The incomplete record was identified during the monthly internal audit process in May, but again, the confusion around the COVID-19 regulatory relief records and those who did not qualify caused the record to get missed and funds not returned on time.

III. Federal and State Award Findings and Questioned Costs This section identifies material weaknesses, significant deficiencies, and instances of non-compliance, including questioned costs, as required by Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirement, Cost Principles, and Audit Requirement for Federal Awards, Section 200.516 Audit Findings. #2019-001 Compliance Requirement: Eligibility Federal Program: Student Financial Aid (SFA) Cluster Award Numbers: CFDA 84.007 P007A184037, CFDA 84.033 P033A184037, CFDA 84.063 P063P183363, CFDA 84.268 P268K193363, and CFDA 84.379 P379T193363 Type of Finding: Significant Deficiency Criteria: Financial aid administrators (FAA) have the authority, through Section 480(d) of the Higher Education Act, to change a student's status from dependent to independent status. According to Student Financial Aid Application and Verification Guide, an FAA may do dependency overrides on a case-by-case basis for students with unusual circumstances. If the FAA determines that an override is appropriate, she must write out the determination and retain it and the supporting documentation. Houston Community College uses a Dependency Override Request form to determine if the students meet the qualified unusual circumstances. The form is attached to the supporting documents and is signed by the student and approved by the financial aid representative. Condition: During our review of supporting documents related to dependency override, we noted 3 out of 12 instances on which there was no electronic or manual signature as evidence that the determination of eligibility to change the status from dependent to independent was approved by the financial aid administrator. Cause: Improper implementation of internal control. Effect: Financial administrators are allowed to make professional judgement decisions for special or unusual family or student circumstances. Circumstances requiring professional judgement decisions must be analyzed on a case-by-case basis. Without evidence of review and approval, there is no control activity that mitigates the risk of inappropriate transactions. Questioned Costs: None reported Repeat Finding: No Recommendation: We recommend the System to ensure that their procedures surrounding their controls related to dependency override are communicated to all campuses for proper implementation. Views of Responsible Official: Federal regulations do not require an aid administrator to sign a dependency override form but must document the reason for the decision. HCC financial aid administrators use a form to review dependency override requests that includes a signature line for the reviewer. Three out of twelve student records documented the reason for the decision but did not have the reviewers? signature on the form. Auditors found three exceptions because HCC?s process requires the aid administrator to sign off on approved dependency overrides. Prior to the findings, all financial aid advisors at the campus locations were reviewing dependency overrides by assigned caseloads.

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