Department of Education releases Ability-to-Benefit guidance

June 18, 2015

The Department of Education (ED) recently issued guidance regarding implementation of the new Ability-to-Benefit (AtB) provision of Title IV of the Higher Education Act (HEA). The provision, enacted as part of the Consolidated and Further Continuing Appropriations Act of 2015, allows students lacking a high school diploma or its equivalent to access federal financial aid if they are enrolled in an eligible career pathway program and can demonstrate college readiness.

The Department’s Dear Colleague letter reiterates the definition of an eligible career pathways program established in statute, and clarifies that the adult education components of career pathways program may not be financed with Title IV student financial aid.

The letter also notes that the definition of a career pathway for the purposes of establishing AtB is not the same as the definition of career pathways established by the Workforce Innovation and Opportunity Act (WIOA), and as such, career pathways programs that qualify for funding under WIOA may not be eligible for Title IV aid.  The Dear Colleague also provides a list of approved AtB tests that institutions may use to assess whether an individual is college-ready.

Consistent with the statutory language authorizing AtB, the Dear Colleague also reiterates that the new measure retroactively applies to students who first enrolled in an eligible program of study on or after July 1, 2014, and allows those students to receive up to $5,730 in Pell grants, the current maximum award. Students who enroll in an eligible program on or after July 1, 2015 may only access a “limited Pell Grant”, or up to $4,860. The maximum Pell grant available to all other students in 2015 will be $5,775.

Prior to 2012, students without a high school diploma or equivalent were able to access financial aid as long as they were able to demonstrate college readiness. The Ability-to-Benefit provision was eliminated as part of the fiscal year (FY) 2012 spending bill. The new AtB provisions passed in the 2015 spending bill partially reinstates the more expansive version of AtB.