This release item modifies FINANCIER to accommodate the change in loan fees for loans whose first disbursement occurs after July 1, 2013, ensuring that the fee, rebate and net loan amounts exported to COD are correct for the actual disbursement date. Leveraging modifications introduced in release item 1207-01, loan fee and interest rebate percentages stored in the Loan Application records are used to compute the disbursement-level values for loan fees, interest rebates, and net loan amounts. (The rebate percentage for both 2012-13 and 2013-14 loans is 0, so only the loan fee changes should affect the net loan amounts.)
The post-July 1 fee percentages are 1.051 for student subsidized and unsubsidized loans, and 4.204 for PLUS loans. As the percentages are expressed to three decimal places, various holding fields and data area fields must be increased in size, affecting WFLNFEEE (Loan fee calculation), WFLOAPPD (Loan Application file PDA), WFDISDFE (Direct Loan fee lookup) and WFDISBSN (Disbursement routine). Because of how ADABAS handles numeric fields, a new conversion program, WCDLCNVB, is required to restore the decimal point to its proper position. (In a 5-byte P3.2 field, "00100" means "001.00", but when it is changed it to P3.3, the new byte is added at the beginning, and the value becomes"000100". It needs to contain the value "001000" to accommodate the decimal place position, so the conversion program simply multiplies the values in the converted fields by ten.)
A new version of last year's conversion program WCDLFEEB will populate the Loan Application fields with appropriate percentages and issue a report of affected students. The program reads through the Loan Application file, populating the loan fee and interest rebate percentage fields with values, depending on whether the first disbursement has been made. If the loan has had dollars disbursed, it assigns the pre-July 1 rates; if no disbursements have yet been made, it assigns the post-July 1 rates and calls WFLNFEEE (the Loan Fee Calculation subroutine) to do its normal job of calculating the actual fee and rebate dollars and the resulting net loan amount, and then updates the corresponding Loan Disbursement records.
The institution must run this program AFTER the last pre-July 1 Disbursement Authorization, Direct Loan Export and Direct Loan Import, and BEFORE the first post-July 1 run of these programs.
Thereafter, if you update an existing loan, WFLNFEEE will leave the percentages intact. On a new loan, it will apply the post-July 1 rates to the Loan Application record and use these rates to calculate the loan fee and interest rebate amounts to be stored in the Loan Disbursement records. The Direct Loan Export will use the stored rates in lieu of hard-coded rates when reporting the two percentages.
Once the changes are put into place as close to July 1 as possible, COD reporting will be correct in all cases. However, a potential complication exists in the Disbursement Authorization process for students who have more than one loan of the same type. The Disbursement Authorization can’t always tell which loans’ dollars are being disbursed in any given run; all it can do is identify disbursements that are made for students who have two loans at two different rates. Most of these will not actually be problems –- anyone who had a fully-disbursed loan prior to July 1 and then gets a second loan afterwards will not be a problem; all of their post-July 1 disbursements should be at the new rate. For the potentially mixed-rate disbursements, the disbursement is done using the post-July 1 rate (which risks under-disbursing the student). If you get "mixed rate loan" warnings from the Disbursement Authorization program, you'll need to decide whether any of the disbursement authorization was done at the wrong rate, and to manually adjust the disbursement (net loan) amount and the payment (loan fee) amount to compensate.