Title IV Disbursement Scheduling Policy

KCC Office of Financial Aid
Title IV Disbursement Scheduling Policy

Effective Date: 3/3/2026
Date(s) Revised:
Approved By: Director of Financial Aid and the VP of Student Affairs
Review frequency: Annually
Responsible Office: Office of Financial Aid
Regulatory Authority: Title IV, Higher Education Act of 1965, as amended

I. PURPOSE

The purpose of this policy is to establish institutional standards governing the scheduling and disbursement of Title IV federal student aid funds in compliance with applicable federal regulations. This policy ensures that disbursement practices:

Demonstrate administrative capability under federal regulations
Protect students from unintended financial liability
Minimize institutional risk of overpayments and Return to Title IV (R2T4) liabilities
Support student success and equitable access to financial resources

II. POLICY STATEMENT

KCC awards Title IV funds to eligible students under the assumption that the student will attend the institution for the entire payment period for which aid was awarded. In accordance with federal regulations, the institution must determine the earned and unearned portions of Title IV aid based on the student’s period of attendance.

Pursuant to 34 CFR §668.16(s), institutions participating in Title IV programs must demonstrate administrative capability, including disbursing funds in a timely manner that best meets students’ needs.

KCC requires confirmation of attendance consistent with its Financial Aid Attendance Policy prior to disbursement. Disbursement scheduling is designed to ensure eligibility, reduce fraud, prevent overpayments, and support regulatory compliance.

Disbursement timing is applied consistently and is published annually in the institution’s Financial Aid Calendar.

III. SCOPE

This policy applies to all Title IV federal student aid programs administered by the Office of Financial Aid, including but not limited to:

Federal Pell Grants
Federal Supplemental Educational Opportunity Grants (FSEOG)
Federal Direct Subsidized and Unsubsidized Loans
Federal Direct PLUS Loans

This policy applies to all eligible students enrolled in credit-bearing programs at KCC.

IV. DEFINITIONS

Title IV Funds: Federal student aid authorized under Title IV of the Higher Education Act.

Credit Balance: The amount of Title IV funds disbursed in excess of allowable institutional charges.

Late Disbursement: A disbursement made after a student becomes ineligible, when permitted by regulation.

Retroactive Disbursement: A disbursement for a completed payment period within the same award year in which the student was eligible but did not receive funds.

Post-Withdrawal Disbursement (PWD): Disbursement of earned Title IV funds after a student withdraws.

V. DISBURSEMENT SCHEDULING STANDARDS

A. General Disbursement Timing

Title IV credit balances resulting in refunds will not be released until after:

The semester/term has begun; and
Institutional eligibility checkpoints have been satisfied.

When excess funds remain after allowable institutional charges are satisfied, a refund will be issued to the student for indirect educational expenses included in the Cost of Attendance (COA).

Title IV credit balances are calculated and disbursed in accordance with 34 CFR §§668.164 and 690.76.

B. Institutional Eligibility Checkpoints

Disbursement occurs after the following checkpoints:

1. Course Refund/Census Date

Disbursing after the institutional refund/census date:

Confirms enrollment in Title IV-eligible coursework
Reduces the risk of overpayments
Minimizes potential Return to Title IV liabilities
Prevents unintended student repayment obligations

Disbursement prior to census may create institutional or student liability if enrollment changes occur.

2. Pell Eligibility Date

The Pell eligibility date is scheduled following the primary census date to allow:

Students dropped for non-payment to resolve eligibility or payment arrangements; and
Students adding eligible coursework (as space permits) to establish eligibility consistent with the Financial Aid Attendance Policy.

3. Federal Direct Loans and PLUS Loans

Loan funds are disbursed only if the student is enrolled at least half-time at the time of disbursement.

First-time, first-year undergraduate borrowers will not receive their first loan disbursement until 30 days after the beginning of the term, pursuant to 34 CFR §685.303(b)(5).

VI. STUDENT SUPPORT PRIOR TO DISBURSEMENT

To mitigate hardship prior to disbursement, KCC may provide:

Temporary course registration holds pending confirmed financial aid
Navigator support services and basic needs assistance
Emergency funding resources
Bookstore charging against anticipated financial aid (when permitted)
Schedule adjustment opportunities during the institutional refund period

Availability of such supports does not guarantee eligibility for Title IV funds.

VII. RETROACTIVE DISBURSEMENTS

(34 CFR §668.164(k))

The institution may make retroactive disbursements for completed payment periods within the same award year or loan period when:

The student was eligible during the completed period;
Required verification and eligibility requirements are satisfied; and
The delay was due to administrative processing or late FAFSA submission.

For Pell Grants, the award must be based on enrollment status at the end of the completed payment period. All completed coursework counts toward enrollment status, including earned “F” grades and incompletes that have not converted to failing grades.

VIII. LATE DISBURSEMENTS

(34 CFR §668.164(j))

A student (or parent for PLUS loans) becomes ineligible for Title IV funds on the date:

The student is no longer enrolled at least half-time (for loans); or
The student is no longer enrolled for the award year (for grants).

A student must be considered for a late disbursement if the Department processed a FAFSA Submission Summary (ISIR) with an official Student Aid Index (SAI) prior to the date of ineligibility.

Eligibility determinations must be documented in the student’s financial aid record.

IX. POST-WITHDRAWAL DISBURSEMENTS

(34 CFR §668.22)

If a Return to Title IV (R2T4) calculation determines that earned aid exceeds aid disbursed, the institution must make or offer a Post-Withdrawal Disbursement.

Institutional requirements include:

R2T4 calculation within 30 days of the date of determination of withdrawal
Disbursement of grant funds within 45 days
Written notification of loan eligibility within 30 days
Loan disbursement within 180 days, if accepted

Loan funds require written confirmation from the student or parent borrower prior to disbursement.

Grant funds will be applied to allowable institutional charges. Any remaining credit balance will be refunded to the student.

Post-withdrawal disbursements:

Must be made from available grant funds before loan funds
May not be made to the account or estate of a deceased student
Are based solely on earned Title IV aid

X. ROLES AND RESPONSIBILITIES

Director of Financial Aid

Ensures implementation and oversight of this policy
Monitors regulatory updates
Provides staff training
Ensures documentation and audit readiness

Financial Aid Staff

Apply disbursement standards consistently
Document eligibility determinations
Maintain compliance with federal timelines

Business Office

Processes refunds and credit balances in accordance with federal cash management regulations

XI. INTERNAL CONTROLS AND DOCUMENTATION

Disbursement schedules are published annually.
All eligibility determinations must be documented in the student record.
Enrollment status must be verified prior to disbursement.
R2T4 calculations must be completed and documented within required federal timelines.
Records are retained in accordance with federal record retention requirements (minimum three years after the end of the award year, or longer if required for audit resolution).

XII. RELATED POLICIES

Financial Aid Attendance Policy
Return to Title IV (R2T4) Policy
Satisfactory Academic Progress (SAP) Policy
Cash Management Policy

XIII. POLICY REVIEW

This policy shall be reviewed annually by the Director of Financial Aid and updated as necessary to reflect changes in federal law, regulation, or institutional practice.

Substantive revisions require approval from the VP of Student Affairs.

XIV. REGULATORY REFERENCES

34 CFR §668.16 – Standards of Administrative Capability
34 CFR §668.164 – Disbursing Funds
34 CFR §668.22 – Return of Title IV Funds
34 CFR §685.303 – Direct Loan Disbursements
34 CFR §690.76 – Pell Grant Payment
Federal Student Aid Handbook (Current Edition)
Federal Register – May 19, 2023
Federal Register – October 31, 2023