[Skip to Content]
News Story

New Guidance on the Partial Restoration of the Ability to Benefit Provisions for Title IV Federal Financial Aid

Posted on 06/17/2015

Ability to Benefit
OTAN Photo | Randy Bayne

The Consolidated and Further Continuing Appropriations Act of 2015 helped reopen the door to opportunity in postsecondary education by changing the Higher Education Act of 1965, as amended (HEA), to partially restore what is known as the "ability to benefit (ATB) alternatives". The new law went into effect on December 16, 2014, and changed the HEA to allow a student who did not receive a high school diploma (or its recognized equivalent), or who did not complete a secondary school education in a home-school setting, to be eligible for Title IV financial aid. This can now be done through a combination of ATB alternatives and enrollment in an eligible career pathway program (as determined by the Title IV eligible institutions' staff).

This ATB provision has the potential to help many students. Consider the following example.

At age 21, Tony is the oldest of five children in a single parent household. He had to drop out of high school at age 17 to work full-time in order to help support his younger brothers and sisters. For the next four years he had a succession of minimum wage jobs to help his family make ends meet. This experience reinforced what he had always heard—that in today's job market there is a need for postsecondary education and training in order to land a good job. So Tony met with an advisor at a local community college to explore his education options. To his dismay, Tony found that he would not be able to receive federal financial aid because he did not have a high school diploma or other high school credential, such as a GED. Discouraged by this news, Tony gave up hope of being able to help his family better its circumstances.

While Tony is only a fictional character, many individuals share his circumstances due to a lack of high school credentials.

A new Dear Colleague letter External link opens in new window or tab from the U.S. Department of Education provides helpful information on the ATB alternatives. Key areas highlighted in the letter include:

  • The definition of an eligible career pathway program that a student must be enrolled in to qualify for the ability to benefit alternative;
  • ATB alternatives requirements that students must meet;
  • Information regarding the retroactive provisions of the new law; and
  • The alternative Pell disbursement schedule for students who first qualify for this provision on or after July 1, 2015.

Source: OCTAE Connection Flash Edition External link opens in new window or tab, June 1, 2015