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  • FSA Penalties for Drug Law Violations

    A federal or state drug conviction can disqualify a student for Federal Student Aid (FSA) funds. The student self-certifies in applying for aid that he/she is eligible. You are not required to confirm this unless you have conflicting information. 

    Student Convicted of Possession or Sale of Drugs

    Convictions only count if they were for an offense that occurred during a period of enrollment for which the student was receiving Federal Student Aid—they do not count if the offense was not during such a period. Also, a conviction that was reversed, set aside or removed from the student's record does not count, nor does one received when he/she was a juvenile, unless he/she was tried as an adult.

    The chart below illustrates the period of ineligibility for FSA funds, depending on whether the conviction was for sale or possession and whether the student had previous offenses. (A conviction for sale of drugs includes convictions for conspiring to sell drugs.) 

        Possession of Illegal Drugs   Sale of Illegal Drugs
    1st Offense   1 year from date of conviction   2 years from date of conviction
    2nd Offense   2 years from date of conviction   Indefinite period 
    3+ Offenses Indefinite Period     

    If the student was convicted of both possessing and selling illegal drugs, and the periods of ineligibility are different, the student will be ineligible for the longer period.

    Schools must provide each student who becomes ineligible for FSA funds due to a drug conviction a clear and conspicuous written notice of his loss of eligibility and the methods whereby he can become eligible again.

    A student regains eligibility the day after the period of ineligibility ends or when he successfully completes a qualified drug rehabilitation program or passes two unannounced drug tests given by such a program. Further drug convictions will make him ineligible again.

    Students denied eligibility for an indefinite period can regain it after successfully completing a rehabilitation program (as described below), passing two unannounced drug tests from such a program, or if a conviction is reversed, set aside, or removed from the student's record so that fewer than two convictions for sale or three convictions for possession remain on the record. In such cases, the nature and dates of the remaining convictions will determine when the student regains eligibility. It is the student's responsibility to certify to you that she has successfully completed the rehabilitation program; as with the conviction question on the FAFSA, you are not required to confirm the reported information unless you have conflicting information.

    When a student regains eligibility during the award year, you may award Pell grant, TEACH, and campus-based aid for the current payment period and Direct loans for the period of enrollment.

    Standards for a Qualified Drug Rehabilitation Program

    A qualified drug rehabilitation program must include at least two unannounced drug tests and satisfy at least one of the following requirements:

    • be qualified to receive funds directly or indirectly from a federal, state, or local government program;
    • be qualified to receive payment directly or indirectly from a federally-or state-licensed insurance company;
    • be administered or recognized by a federal, state, or local government agency or court; or
    • be administered or recognized by a federally-or state-licensed hospital, health clinic, or medical doctor.

    If you are counseling a student who will need to enter such a program, be sure to advise the student of these requirements. If a student certifies that he has successfully completed a drug rehabilitation program, but you have reason to believe that the program does not meet the requirements, you must find out if it does before paying the student any FSA funds.

    Directly quoted from the Information for Financial Aid Professionals (IFAP) website.