Summary of the State Higher Education Grant Program Eligibility Requirements for Change of Ownership for Schools

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Institutional Requirements

Change of ownership is addressed in PHEAA Regulation 121.32(b) (6).

Any school or hospital school of nursing requesting to continue participation in the State Higher Education Grant Program due to a change of ownership must notify the Agency in writing of the change of ownership within 30 days of the effective date of the change. The CEO of the new owner must execute and file with the Agency, a Change of Ownership Agreement provided by the Agency to assume responsibility of repayment of State Grant funds to the Agency or payment of State Grant funds to eligible students, as designated by the Agency, made necessary by the failure of the previous owner to follow Agency procedures and requirements. An institution that fails to execute this agreement will be required to wait 24 months before being considered for approval in the State Grant Program—PHEAA Regulation 121.32(b)(6). Two Master Agreements and Schedule A will also be sent for signature. The hold status will inhibit reject notices from being sent to student applicants while the school is in this transition period.

At the time of notification of the change of ownership, an administrative hold status will be placed on disbursements and processing for the State Grant Program. The school's State Grant master record will remain in a hold status until all requirements for re-establishing eligibility have been satisfied.

Once the hold has been placed on disbursements, Institution Compliance & Eligibility will provide the schools with a Change of Ownership Agreement and a Master Agreement, which will need to be signed by an official of the school, authorized to execute the agreements, and have the authority to contractually bind the institution.

In addition to signing these agreements, the school will be required to provide approval letters from the Pennsylvania Department of Education and/or their respective State Licensure of their change of ownership, and are not in an unapproved status with the Pennsylvania Department of Education or their respective State Licensure. In the case of a hospital school of nursing, the Pennsylvania Department of Education does not apply; instead, it would be the National League for Nursing and the Pennsylvania State Board of Nursing. In addition, the school must provide an approved Program Participation Agreement from the U.S. Department of Education.

Agency approval of schools will not be permanent and will be subject to review at any time and specifically upon change of administration and/or ownership, or upon receipt of a complaint regarding operational procedures. It is the responsibility of the school under the current ownership to notify the Agency immediately of an impending change in administration and/or ownership, as well as changes in the institution's accrediting or licensing status. A school must merit its placement and maintenance on the approved list.

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Institution Compliance & Eligibility
1200 North 7th Street
Harrisburg, PA 17102-1444