Administration of Scholarships, Prizes, Cost of Attendance Remissions, Stipends and Awards
Effective Date: July 1, 2011
This Policy has been designed to help various administrative and academic departments of the University determine the most effective method of administering scholarships, prizes, cost of attendance remissions, stipends and awards so as to ensure full compliance with the University’s obligations with respect to the administration of federal financial aid funds and compliance with its tax reporting obligations.
This Policy supersedes procedures previously followed for awards made to recipients known as Educational Scholarship/Fellowship Recipient (“ESFR”). The term ESFR is no longer applicable to any award to any Student at the University.
Administration of scholarships, prizes, cost of attendance remissions, stipends and awards are subject to other University policies (e.g. Human Resources and Research policies), as well as, state and federal laws and regulations. This Policy shall be implemented in a manner consistent with all such policies, laws and regulations, as those may be amended from time to time. The rules and administrative processes set forth in this Policy are subject to change and will be updated as needed to reflect such amendments.
The Policy applies to Scholarships, Prizes, Cost of Attendance Remissions, Stipends and awards to all Students enrolled at the University.
III. Covered Members of the University Community
This Policy applies to all University trustees, officers, employees and Students.
All Colleges through their administrators and faculty must comply with this Policy. Failure to do so may result in incorrect recording or application of the Scholarship, Prize, Cost of Attendance Remission, Stipend or award, to taxing authorities, and/or may result in the University’s non-compliance with government-mandated laws, rules and regulations.
- “Aid” means funds awarded to a Student from external funding sources or with University internal funds. Aid is also funds borrowed with federal and commercial student loans.
- “Total Aid Package” means the aggregate amount of aid provided to a Student from all sources.
- “Cost of Attendance Remission” means funds awarded to a Student that may be used to pay for University charges, including tuition, on-campus room and board, and/or to defray the cost of University assessed fees. The source of the funds for the remission can include, without limitation, restricted or unrestricted departmental or grant funds.
- “Fellowship” The University makes no distinction between “Fellowships” and Scholarships; unless the Fellowship is money paid to a student who performs services for the University (see “Stipend”).
- “Grants” The University makes no distinction between “Grants” and Scholarships; unless the Grant is money paid to a student who performs services for the University (see “Stipend”).
- “Prize” means an item or transfer (monetary or otherwise) given to a Student in recognition of success in an organized competition that is not required as a part of the curriculum. An item or transfer (monetary or otherwise) given to a Student in recognition of success in an organized competition that is required as a part of the curriculum will be treated as a Scholarship.
- “Reimbursable Expense Award” means funds provided to a Student to defray the cost of travel to, or participation in, an academic conference or other related activity. To qualify as a Reimbursable Expense Award, the Student recipient must provide the department providing the funds with receipts for all reimbursable expenses. Such expenses must equal or exceed the amount of the award. Amounts provided to the Student in excess of expenses will be treated as a Prize.
- “Scholarship” means funds awarded to Students with the intent to support the educational expenses of the recipient. Scholarships include funds awarded for tuition, fees, room, board, travel related to educational opportunities (other than Reimbursable Expense Awards), books and other educational expenses. An item or transfer (monetary or otherwise) given to a student in recognition of success in an organized competition that is a required part of the curriculum will be treated as a Scholarship. Scholarships may be either merit or need-based.
- “Stipend” means money paid by the University to a Student for services rendered to the University or to a third party (e.g., a co-op employer or internship placement), which includes the following:
- Research for a member of the faculty whether or not equivalent research is a requirement of all candidates for the degree in the Student’s particular program (e.g. Graduate Research Assistant, Graduate Research Fellow).
- Teaching student classes under the direction of a member of the faculty (e.g. Graduate Teaching Assistant)
- Research training techniques for work under a federally sponsored grant.
- Any other service provided by the Student to the University or to a third party (e.g. Graduate Assistant). National Research Service Awards (e.g. N.R.S.A. Fellows) paid to post-doctoral students will be processed through the Human Resources and Payroll Departments. N.S.R.A. awards to registered students will be processed through the Financial Aid Office.
- “Student” means an individual who, at either the undergraduate, graduate or professional level, is enrolled in classes (or is employed in a co-operative educational position or who is engaged in an internship experience) and/or is registered for research, thesis, or dissertation requirements.
- “Cost of Attendance” means the aggregate cost to a Student to enroll in a degree program, including tuition, the cost of books, fees, and other related educational expenses, as well as the cost of on- or off-campus room and board.
- “University” means Drexel University and its subsidiaries and affiliates, including the Drexel University College of Medicine.
Scholarships and Prizes Distinction
Scholarships must be awarded to the Student through the Financial Aid Office. Prizes are processed through the Accounts Payable Department. In the event that there is uncertainty regarding the appropriate characterization of a particular award, a committee comprised of a representative from the Financial Aid Office and a representative from the Finance Division shall review the award to determine the appropriate characterization. The decision of such committee shall be binding and non-appealable. The manner in which an award is identified (i.e., as a “Prize” or as a “Scholarship”) shall not be dispositive.
All Scholarships over which the University has discretion must be reviewed in advance of being offered to a Student by the Financial Aid Office to ensure that they comply with applicable federal student aid regulations. A Student’s Total Aid Package cannot exceed the Student’s Cost of Attendance, and, in the case of need-based Scholarships, cannot exceed the proposed recipient’s unmet need. Upon notification by the Financial Aid Office, the Scholarship will be applied to the Student’s account by the Office of the Bursar. This procedure does not preclude recognition of the Scholarship in the form of a ceremony in which the recipient is presented with a certificate or “ceremonial check.”
If an award meets the definition of a Prize, then a check will be issued to the recipient by the Accounts Payable Department in the normal course of business and pursuant to the guidelines established by that office. Appropriate reporting of the payment shall be made by the University in compliance with applicable taxing authority guidelines. All prizes awarded to University employees will be paid through the Payroll Department and will be included on the employees Form W-2.
3. Cost of Attendance Remission
A Cost of Attendance Remission is normally awarded to students from a budgetary or discretionary account of a Dean. The student recipient must be a Student enrolled in a degree program. Each Dean’s office must establish and maintain a record of the guidelines used to select student recipients for Cost of Attendance Remission funded by their account. To ensure fairness and equal opportunity for candidates across the entire student body, a Cost of Attendance Remission should require the same level of merit and/or need-based selection criteria as a University administered Scholarship awarded directly through the Financial Aid Office. Such selection criteria, as well as the designated funding source, for the Cost of Attendance Remission must be reviewed and approved by the Provost’s office prior to any award or disbursement of funds. No research, teaching, or other administrative duties may be required of the Student in return for a Cost of Attendance Remission. All Cost of Attendance Remissions must be reviewed in advance of being offered to a Student by the Financial Aid Office to ensure that the award complies with applicable federal student aid regulations. The Total Aid Package (including Cost of Attendance Remissions) cannot exceed the Student’s Cost of Attendance. Cost of Attendance Remissions will be applied to a Student’s financial aid award by the Financial Aid Office, and will be used by the Office of the Bursar to cover the Student’s outstanding financial obligations to the University. For sake of clarity, Cost of Attendance Remissions awarded to Graduate Students must be made simultaneously with Stipends, and both are to be applied in accordance with University policies and procedures (e.g. Human Resources and Finance policies) as well as applicable laws and regulations. Cost of Attendance Remissions are not refundable. Cost of Attendance Remissions cannot be used to fund off-campus housing. Cost of Attendance Remissions will be reduced by any amount in excess of University assessed charges.
Stipends are administered pursuant to policies and procedures established by the University’s Department of Human Resources. Stipends are paid to Students through the Payroll Department. Appropriate reporting of the Stipend shall be made by the University in compliance with applicable taxing authority guidelines.
5. Refunds and Reductions in Aid
If a Student’s Total Aid Package, applied in accordance with the rules governing the award of financial aid, institutional policy and the terms of the particular awards, exceeds the Student’s Cost of Attendance, a Student may be entitled to a refund. The amount available to be refunded to the Student will be determined by the sources of the Total Aid Package. Loan funds are always refundable. Scholarships may be refundable depending upon the terms of the Scholarship. The University will not issue refunds for Cost of Attendance Remissions. The Financial Aid Office is responsible for determining whether a particular award is refundable and, if so, the amount of any refund. The decision of the Financial Aid Office shall be final with respect to the refunding of funds. If a Student receives additional aid after the calculation of the Total Aid Package, certain forms of need based aid (for example, Pell Grants) may be subject to reduction. Loans will be reduced before any other aid sources, except if the terms of a particular award require that it be reduced before Aid from any other source is reduced.
6. Tax Treatment
Taxes due on all Prizes and Stipends, as well as on all aid awarded or refunded to a student (whether a Scholarship or Cost of Attendance Remission) that exceeds the Cost of Attendance, are the responsibility of the Student recipient. The University will withhold any applicable taxes in accordance with taxing authority guidelines. In general, it is against University policy to “gross-up” funds disbursed to Students (regardless of whether the funds are in the form of a Scholarship, Stipend, Prize or Cost of Attendance Remission) for the amount of any taxes that the University is required to withhold. In exceptional circumstances, and with the prior written approval of the Senior Vice President of Finance, the University will “gross up” funds awarded to a Student.
No University employee may issue a letter or otherwise advise aid recipients regarding the tax treatment of such aid. The University’s Office of Tax Compliance is solely responsible for determining the appropriate tax treatment of all aid, and the decision of that office shall be final.
7. Retroactive Awards
No aid may be awarded retroactively to a Student without the prior written permission of the Financial Aid Office.
VI. Violation of the Policy
Violation of this policy and procedure or failure to timely cooperate in complying with its provisions may result in disciplinary action up to and including dismissal.