In the fall of 2020, the Department of Education published a final rule altering various regulations issued under the Higher Education Act of 1965. Effective as of July 1, 2021, the series of changes included an amendment that modifies the Clock-to-Credit Conversion formula. This significant update will determine the number of Title IV credit hours that can be applied to each class program as well as whether the program meets minimum length requirements for Federal Student Aid (FSA) eligibility.
Under the new rule, institutions are no longer required to consider out-of-class work hours as part of the clock-to-credit conversion. This is a departure from the previous formula, which, according to an announcement issued by the FSA, “could include ‘work outside of class’ (out-of-class) hours as long as the in-class hours met a lower ratio – 30 clock hours to one semester hour or 20 clock hours to one quarter hour – and the institution’s accrediting agency had not identified any problems with the institution’s establishment of credit hours.”
Our team reviewed the new calculation in our recent webinar to demonstrate the changes to the process and eligibility requirements. You can access this recording below or read on for a detailed breakdown of the updated Clock-to-Credit Conversion.
New Clock-to-Credit Conversion Formula – Requirements
- Semester or trimester hour must include 30 clock hours of instruction (30:1)
- Quarter hour must include at least 20 clock hours of instruction (20:1)
- Outside hours and/or homework are NOT factored in the conversion
- Results of conversion calculation can never be rounded up, decimals are accepted
To determine the number of credit-hours in a program for FSA purposes, schools must use one of the following formulas
- For a semester or trimester hour program: Number of clock hours in the credit-hour program divided by 30
- For a quarter hour program: Number of clock hours in the credit-hour program divided by 20
Reporting changes due to conversion
If the new calculations result in an increase in the number of Title IV credit hours in a program, the school must update their E-App immediately and report both the number of clock hours and Title IV credit hours in the program.
Conversely, if the new calculation does not change the number of Title IV credit hours in a program, the school should update their E-App to change the number of clock hours reported for the program when the next update or recertification application is submitted.
Most institutions offering non-degree programs in credit hours will be subject to the new conversion rule unless certain criteria are met. Examples include:
- Programs that are at least two academic years in length and provide an associate degree, a bachelor’s degree or a professional degree, OR
- Programs where each course is acceptable for full credit toward a specific degree at that institution, provided that the program requires at least two academic years of study; AND the institution can demonstrate that at least one student graduated from the program during the current award year or the two preceding award years.
As always, we are here to help financial aid departments and their institutions manage the ever-changing regulatory environment and find customized solutions to any issues they face. Schedule a call today or sign up for our newsletter to stay up to date on all industry changes.