CHAPTER 90
VIRGINIA GRADUATE AND UNDERGRADUATE ASSISTANCE PROGRAM REGULATIONS (REPEALED)

8VAC40-90-10. Definitions. (Repealed.)

The following words and terms, when used in this chapter, will have the following meanings, unless the context clearly indicates otherwise:

"Council" means the State Council of Higher Education for Virginia.

"Domiciliary resident of Virginia" means a student meets the definition of a domiciliary resident of Virginia, as specified under § 23-7.4 of the Code of Virginia.

"Full-time student" means a student who is enrolled for at least 12 credit hours per semester or its equivalent at the undergraduate level or nine credit hours per semester or its equivalent at the graduate or first professional level. The total hours counted will not include courses taken for audit, but may include required developmental or remedial courses and other elective courses which normally are not counted toward a degree at the institution.

"Graduate student" means a program-placed student enrolled in an approved master's, certificate of advanced graduate study, specialist, doctoral, or first professional degree program.

"Program" means the Virginia Graduate and Undergraduate Assistance Program.

"Undergraduate student" means a program-placed student in an approved program leading to a certificate, diploma, associate's degree, or bachelor's degree.

8VAC40-90-20. Purpose. (Repealed.)

In 1990, the General Assembly created the Virginia Graduate and Undergraduate Assistance Program. The program is designed to provide student financial assistance funded from a combination of endowment income and state general fund appropriations. Full-time students who attend a Virginia public four-year or two-year college or university are eligible for the assistance. The general fund appropriation for this program will be made to the State Council of Higher Education for Virginia which will allocate the funds directly to the institutions of higher education. The council administers the program.

8VAC40-90-30. Eligible endowment funds. (Repealed.)

The following restrictions govern the receipt of endowment funds under the program:

1. The effective date of this program is July 1, 1991. Income earned by endowment funds created prior to July 1, 1991, is ineligible.

2. To qualify for the program, gifts to institutions or their tax-exempt foundations must be restricted by donors to establish a true endowment for the sole and specific purpose of generating income for student financial assistance under the program.

3. True endowment funds are funds received from a donor or donors with the restriction that the principal is not expendable on a current basis. Qualifying income related to each endowment will be a function of the spending policies adopted by the institutions. Growth in the endowment corpus may occur through increase in market value, receipt of additional restricted and qualified gifts to a specific, qualified endowment fund, or through the return of qualifying endowment income to corpus under a board-approved spending plan that maintains the purchasing power of the original gift.

4. Documentation of a gift establishing a qualifying endowment will be maintained by the institution or its tax-exempt foundation. The documentation must show the donor's intent to establish a true endowment and state clearly that the income from the true endowment is to be used for the sole and specific purpose of providing student financial assistance under this program. Documentation held by a tax-exempt foundation must be available to the institution for audits.

5. Institutions may seek an exception for gifts that do not meet all of these restrictions but appear to meet the intent of the program by submitting supporting material to the council staff for its review and certification of eligibility.

8VAC40-90-40. Use of funds. (Repealed.)

The following restrictions govern the use of funds under the program:

1. The first matching awards under the program will be made after July 1, 1992, subject to appropriations from the General Assembly.

2. Requests for matching funds must be based upon actual income on endowment funds already received by the institution or its tax-exempt foundation. No estimates based on anticipated endowment gifts may be included.

3. Full-time graduate, first professional, and undergraduate students in Virginia state-supported colleges and universities are eligible to receive awards under this program.

4. At least 50% of the recipients designated by an institution under this program shall be awarded to persons eligible to be classified as Virginia domiciliary resident students.

5. Awards must be made on a competitive basis to outstanding graduate, first professional, and undergraduate students. Each institution shall determine the criteria by which outstanding academic achievement is determined.

6. Awards shall be used only to pay tuition, fees, room, board, or other educational expenses, unless restricted further by the donor.

8VAC40-90-50. Allocation of funds. (Repealed.)

A. The appropriation of state funds under the program will be made to the council. The funds subsequently will be distributed to institutions, based on the council's allocation plan. In order to receive state matching funds under this program, institutions will file with council a statement that contains the following information:

1. An estimate of the corpus of eligible endowment funds at the end of the fiscal year preceding the year for which the request is being made.

2. Statement of actual income on the endowment for the preceding fiscal year. The statement should include the amount expended under the program, the amount returned to the fund to preserve spending power under an approved spending plan, and expendable balance.

3. Estimated income for future years, containing the same information described in subdivision 2 of this section. Estimated income should be calculated using an assumed rate of return equal to or less than the actual rate during the previous fiscal year on this class of funds. Supporting detail on each separate fund, if applicable, must be made available upon request.

4. The total request for state matching funds.

5. A certification statement, signed by the president or vice president of financial affairs, that the request conforms to the eligibility requirements contained in this chapter, the Code of Virginia, and the governing board of the institution.

B. Program funds will be distributed annually. All distributions of state matching funds are subject to the availability of funds and will be subject to the following guidelines:

1. Subject to the availability of funds, in each year of the biennium each institution participating in the program will be allocated an amount equal to the lesser of its actual expenditures under the program for the preceding fiscal year or its request for state funds for the upcoming fiscal year.

2. Remaining funds will be allocated to institutions pro rata based on the institutions' unmet requests after the application of the first step, subject to the reasonableness of the request.

3. To receive matching funds, institutions must submit to the council a copy of DPB Form 27, a copy of the deposit certificate showing that matching endowment income has been deposited with the state treasurer, and any other material requested by the council or its officers.

8VAC40-90-60. Reporting requirements. (Repealed.)

Each institution participating in the program will submit annually to the council a report on program activities during that year. The report will contain the following information:

1. The total number of recipients under the program, by level and domiciliary status.

2. The total dollar value of awards expended under the program, by level and domiciliary status.

3. The criteria used for awarding the scholarships and fellowships.

4. Other information that may contribute to an understanding of the effectiveness of the program.

Reports, certifications, documentation, and other material necessary to administer the program will be maintained by the institutions in accordance with their standard retention programs. These documents will be subject to routine review by the council and to audit by the Auditor of Public Accounts.