Reinstatement of Ability to Benefit Alternatives

By McClintock & Associates | December 20, 2016

By Douglas T. Mawhinney

The Department of Education has recently announced that students without a high school diploma (or recognized equivalent) may soon be able to receive Title IV funds through the reintroduction of Ability to Benefit Alternatives ( This option is available only for students enrolled in an “eligible career pathway program” (click to see more details) and follows a modified Pell grant schedule with lower disbursement amounts, but it allows students lacking the usual secondary school credentials to receive federal subsidies for their postsecondary education without the extra step of obtaining their GED and can even be retroactive for current students!

In a Dear Colleague Letter (GEN-15-09) dated May 22nd, 2015 the Department of Education laid out three options for students lacking a high school diploma (or equivalent) to be eligible for Title IV aid: (1) Pass an independently administered Department of Education approved ATB test, (2) complete at least 6 credits/225 clock hours applicable to a degree or certificate offered by the postsecondary institution, or (3) complete a state process approved by the Secretary of Education (as of May 22nd, this was a theoretical option, as no State process had yet been submitted for approval). Students grandfathered in under the previous ATB standards, as laid out in the Dear Colleague Letter GEN-12-09 are not affected by these new standards and may continue to receive Title IV funds under the previous rules.

Any institution can offer eligible career pathway programs; the program must simply adhere to the following seven stipulations: (1) concurrently enroll students in connected adult education and eligible postsecondary programs, (2) provide students with counseling and supportive services to identify and attain academic and career goals, (3) provide structured course sequences that are articulated, contextualized, and allow students to advance to higher levels of education and employment, (4) provide opportunities for acceleration for students to attain recognized postsecondary credentials, including degrees, industry relevant certifications, and certificates of completion of apprenticeship programs, (5) be organized to meet the needs of adults, (6) be aligned with the education and skill needs of the regional economy, and (7) have been developed and implemented in collaboration with partners in business, workforce development, and economic development.

These eligible career pathway programs have two major components: an adult education component and a Title IV eligible postsecondary program component. The adult education (as defined under the Adult Education and Family Literacy Act, Title II of the Workforce Innovation and Opportunity Act (Pub. L. 113-128) includes education below the postsecondary level to permit a student to attain a high school diploma or GED, transition to postsecondary education/training, or obtain employment. Since this adult education is below the postsecondary level, it is not eligible for Title IV and an institution may not include these costs in the student’s cost of attendance or pay for this component using Title IV aid.

There are several options for the independently administered Department of Education approved ATB tests, including the Wonderlic Basic Skills Test, ACCUPLACER, CELSA, ASSET, and COMPASS (including COMPASS ESL). Any students who were enrolled in an eligible career pathway program before July 1st, 2014 and qualified under one of the ATB benefits may receive Pell, TEACH, or any campus based aid beginning with the 2014-2015 award year and Direct Loans for the entire loan period that includes July 1st. Students who meet these requirements as of July 1st or later may begin receiving Title IV aid with the first payment period and Direct Loans for the entire loan period in which the student meets the ATB alternative. As the funding for this initiative is based through a discretionary appropriation (rather than mandatory funding as normal Pell) students qualifying under ATB alternatives have their Pell grant based upon an alternate schedule that maxes out at $4,860. We recommend that schools discuss these regulations with their advisors to determine if any educational opportunities exist.

Volume 2, Issue 3
Summer 2015

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