Understanding Disbursement Rules

Before setting up disbursement rules, you must:

• Set up your institution's financial aid item types and packaging disbursement plans and IDs for the aid year for which you are processing disbursements. These tasks are part of your setup for awarding students.

• Define the FA-BUDGET item grouping in PeopleSoft Student Financials.

• Understand how service impacts and checklists affect your financial aid processes.

• Define the specific eligibility criteria necessary to authorize the disbursement of your financial aid funds to students.

Authorization and disbursement are the two parts of delivering financial aid funds to students:

• The authorization process applies user-defined global and financial aid item type specific disbursement rules to determine whether awards are eligible for disbursement and determines the amount eligible for disbursement.

• When the awards are successfully authorized, disbursement is the actual delivery of financial aid funds to the student's account in Student Financials.

You define authorization process rules by aid year, career, and award (financial aid item type). These rules allow or prevent the disbursement of awards for students in a particular career or for a particular award. A Validation process during awarding or packaging checks on a variety of rules and limits, but student information, particularly registration information, can change before disbursement occurs. The Authorization process checks rules just before the disbursement of awards, either online or in a background authorization process.

Global disbursement rules can apply to all students in a particular career and check that packaging, federal verification, and review of the student's financial aid files are complete. Service impacts and tracking groups can be checked as a global rule. Global rules can hold financial aid if the student has withdrawn, honor any disbursement hold that might exist elsewhere in the system, and withhold disbursement for unsatisfactory academic progress.

Item type disbursement rules for particular awards are associated with a career, so different rules can be defined for each career in which the award is used. Many disbursement rules can be applied to an award, such as:

• Checking a student's academic load and academic level against the load and level used to determine thee student's budget or award package.

• Holding if a student is overawarded, has withdrawn, or has other holds in the system.

• Verifying membership in a particular student group, such as an ethnic group, athletic team, geographic location, honor students, or particular field of study.

• Using checklists, tracking groups, or service impacts.

The background disbursement process uses disbursement and authorization calendars to determine when awards can be disbursed to students:

• Authorization calendars indicate the careers and terms that are eligible for authorization and if aid can be authorized more than once for that term, or reauthorized. Reauthorization retests the student's eligibility criteria to ensure that the student is still eligible for awards previously authorized and that changes made after the prior authorization have not made the student ineligible for the award.

• Disbursement calendars control which awards, by career, are disbursed for a particular term. You can disburse all awards, all awards except a defined subset, or only a subset of awards. Use the disbursement calendar to control when certain awards are disbursed during the aid year.

The calendars are both effective-dated so you can set up your background disbursement plans for the entire aid year with effective dates for your second, third, and subsequent terms that determine when the awards are disbursed. Alternatively, you can use the same effective date on your calendar for all terms and use run control parameters to control the order in which awards are disbursed. Run control parameters can restrict the background authorization and disbursement processes to only a subset of terms and financial aid item types or can improve processing efficiency by dividing the total population of aid students into several smaller groups that you run sequentially.

If financial aid at your institution is always awarded based on a full time academic load or you have funds for which a full time academic award is assumed, you can set proration rules for specific awards. Use proration rules to base the disbursement for specific awards on a student's enrollment load instead of using the default full time award amount. The term award amount is prorated based on a formula that you set up on the Disbursement Proration Rules page. The proration is calculated for each disbursement for an award and the amounts can vary depending on the term each disbursement is assigned.

Disbursement proration rules are most useful for nonfederal awards and institutional funds for which the award amount should be based on the academic load of the student. You can apply a disbursement proration rule to a financial aid item type when you define the financial aid item type's disbursement rules—on the Disbursement Rules: Item Type - Indicators page.

The disbursement authorization process uses global disbursement rules that are defined by career and apply to all financial aid item types. Use global disbursement rules to set up requirements that all students in the selected career must meet for authorization. Several different elements can be selected in the global disbursement rules, such as service impacts, tracking groups, and academic progress information. For example, you might set up a specific tracking group for students in a certain career. If a student does not meet the items in the tracking group, then the global disbursement rules are not satisfied and the student's aid is not authorized for disbursement.

The disbursement authorization process considers global disbursement rules, defined by career, before it considers item type disbursement rules. In addition, the authorization process verifies whether awards have been accepted and sufficient fiscal funds are available for the disbursement.

Item type disbursement rules enable you to identify specific criteria that must be met before authorizing individual awards for disbursement. Item type disbursement rules are set up for each career, so if multiple careers use the same item type, you need to define item type disbursement rules for each career. Doing so allows you to select different item type disbursement rules for different careers that use the same item type. Item type disbursement rules take effect during authorization and apply to the designated item type only. Set up item type disbursement rules for all awards (financial aid item types) that have specific rules applied to them.

For example, a Perkins loan might require completion of a particular checklist. You can make the Perkins loan disbursement contingent upon completion of the checklist by adding the checklist as part of the item type disbursement rules. If the Perkins loan fails the authorization step and can not be disbursed, all other awards to the student can be authorized and disbursed.

The disbursement authorization process considers global disbursement rules, defined by career, before item type disbursement rules. In addition, the authorization process verifies whether awards have been accepted and that sufficient fiscal funds are available for the disbursement.

Authorization and disbursement calendars are used by the background authorization and disbursement processes only. If you do not use background authorization and disbursement, you do not need to create these calendars. If you set up these calendars, they are not used if you authorize and disburse awards manually (online). For this reason, ensure that access to your online disbursement pages is carefully determined.

Authorization and disbursement calendars must include each term for which you disburse aid for the aid year. Both calendars use separate effective-dated rows. Using both authorization and disbursement calendars and run control parameters gives you flexibility in implementing your institution's authorization and disbursement. For example, you can set up a single effective-dated row for both the authorization and disbursement calendars where all valid terms and financial aid item types are selected, and then use the batch run control parameters to control the term and financial aid item types that are processed.

Alternatively, you can use multiple future effective-dated rows to introduce the terms and financial aid item types that should be processed over the course of the school year and use the batch run control parameters for exception processing only. For example, if you need a fall and spring disbursement calendar, you might set the fall term's effective date in August and the spring term's effective date in December, one month before the beginning of each term. When background authorization and disbursement is run in September, only awards for fall term would be disbursed because only the authorization and disbursement calendars for fall would have a valid effective date. Both disbursement and authorization calendars, with effective dates, should be set up for each term. Review your business processes carefully to determine the best way to set up your background processes.

The Disbursement ID Table is set up when you define disbursement plans and split codes for awards. A disbursement ID is set up for each disbursement that should be associated with a disbursement plan. Each disbursement ID has a disbursement date associated with it to control the disbursements. The background disbursement process uses the disbursement date to determine whether the awards can be disbursed. The background disbursement process only disburses awards if the cutoff date, on the disbursement calendar, is equal to or later than the disbursement date on the Disbursement ID Table. Set up both the cutoff date on the disbursement calendar and the disbursement date on the Disbursement ID Table to ensure that awards are disbursed at the correct time.