Section 20 AAC 15.950 - Disbursement and handling of loan awards(a) The commission will disburse a loan in installments based upon the terms, quarters, or semesters used by the institution of attendance. A loan for attendance at an institution that does not operate on a term, quarter, or semester system will be disbursed in two installments. The first disbursement will be made at the beginning of the program and the second will be made at the halfway point, based on the dates of attendance for which the loan is made. Disbursements will be made in equal amounts unless an eligible postsecondary institution designates alternate amounts, the total of which does not exceed the total certified loan amount.(b) The commission will send each loan award installment on behalf of the student to the financial aid office of the institution that the student is attending.(c) Before disbursing the loan, the institution of attendance shall certify on a form provided or approved by the commission, or by using an alternative method approved by the commission, that institutional records indicate as of the disbursement day or the business day before disbursement that (1) the student is eligible for the disbursement under 20 AAC 15.945(b) and (c);(2) the institution is not disbursing loan proceeds in excess of costs allowed under AS 14.43.120(a), after considering other financial aid and either (A) the institution's standard budget for the applicable number and type of credit hours, or vocational program, in which the student is enrolled, or(B) the student's documented actual costs for the number and type of credit hours, or vocational program, in which the student is enrolled; and(3) the institution's records classify the student as an Alaskan resident, if the institution maintains records of the residency of students.(d) Loan proceeds may not be disbursed under a power of attorney assignment by the student unless (1) the student has already successfully completed the program of study for which the loan was awarded; or(2) the student is unavailable because the student is in an extern program of the institution.(e) The institution is responsible for the completion and retention in the permanent student file of an institution disbursement and receipt form approved by the commission. The commission staff may not issue further loan warrants or transfer additional loan proceeds if the institution fails to comply with this requirement.(f) An institution shall return to the commission, with an explanation for the return, loan proceeds that are not disbursed to the student within the later of (1) 60 calendar days after the date the commission issued the warrant or transferred loan proceeds to the institution;(2) 60 calendar days after the beginning of the term for which the loan proceeds are awarded; or(3) for a second disbursement of a vocational program loan, 60 calendar days after the midpoint of the program period for which the loan is awarded.(g) An institution that has courses of study for which tuition is charged on a pay-as-you-go basis and that holds unearned tuition money on behalf of a student shall place that money in a non-interest-bearing trust account containing only tuition money. The tuition money may be withdrawn only as it is earned by the institution as a result of the student's enrollment and attendance under the terms of the institution's enrollment agreement. If a student fails to attend, or otherwise withdraws from the institution, the balance of the student's tuition money remaining on account with the institution shall be returned to the commission within 60 days.(h) An institution may not disburse loan proceeds to a student who is on an approved leave of absence or if the institutional records contain documentation to indicate that, as of the business day before the disbursement, the student is not eligible for the disbursement, and the student did not become eligible before the disbursement occurred.(i) The commission staff may make loan award payments electronically or in another format that provides loan proceeds directly to the institution rather than by loan warrants payable to individual borrowers. Before approving an institution for participation in electronic or direct loan payment, the commission staff may require documentation of the institution's administrative capability to successfully participate in electronic fund transfers or alternative direct payment. The requirements under this section for handling a loan warrant apply to the handling of a payment electronically transferred or otherwise directly transferred to an institution.(j) For a student enrolled in more than one institution, the degree-granting institution must also make the certification required by 20 AAC 15.945(e).Eff. 3/22/97, Register 141; am 4/20/2000, Register 154; am 4/27/2001, Register 158; am 4/6/2018,Register 226, July 2018; am 8/16/2024, Register 251, October 2024Authority:AS 14.43.105
AS 14.43.120
AS 14.43.300
AS 14.43.320
AS 14.43.630
AS 14.43.640
AS 14.43.740