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					                    Using Your Education Award
                                                                              Updated June 2003


When you successfully complete your term of national service, your project will
notify the National Service Trust that you are eligible for an education award.
The Trust will send you your education award packet within two weeks of
receiving this notification. (The Trust is the office at the Corporation for
National and Community Service that administers the education award
program). This handout contains important information for AmeriCorps
members who have received or are about to receive their education awards.

Highlights

--You have seven years from the date you completed your service to use the award.
--You can use your education award to repay qualified student loans, to pay
  for current educational expenses to attend qualified schools, and to attend an approved
  school-to-work program.
--Payments are made to the school or loan company, not to you.
--You request payments by filling out the top portion of your Voucher and Payment
  Request Form and sending it to your school or loan holder.
--The award can be used for degree and non-degree courses at Title IV schools.
--The amount for current education expenses is determined by the
  school, not by you or the Trust.
--Payments made from your education award account and interest payments are
  considered to be taxable income.

OVERVIEW OF THE EDUCATION AWARD PROCESS

To qualify for an education award, you must successfully complete the required term of
service for the program in which you were participating. "Successful completion" means
completing the requirements of the service assignment, including meeting the minimum hour
requirement.

It is up to the director of the program in which you served (or for VISTAs, the Corporation
State office) to determine if you have successfully completed a term of service and are
eligible for an education award. He or she does this by notifying the Trust that you have
successfully completed the service and are eligible for an award (or have not completed the
service and are not eligible). Upon notification that you are eligible for an award, the Trust
will send you a packet of information needed to access the award. Included will be a Voucher
and Payment Request Form and instructions for filling it out. This is the document which
you’ll use to authorize a payment to be made from your education award account. A sample
copy of this voucher is on the next-to-last page of this handout.

.
You can use your education award in the following ways: 1. To repay “qualified student
loans”; 2. To pay for CURRENT educational expenses a “qualified institution of higher
education”; and 3. To pay expenses incurred while participating in an approved school-to-
work opportunities system program.

You must use your education award within seven years of the completion of your term of
national service. It can be divided up and used any way you choose, as long as it is for
authorized expenditures. For example, a portion of the award could be applied to repay
existing qualified student loans and the remainder saved to pay for authorized college costs
in the future.

When you’re ready to use your award, you must complete the top section of the voucher,
authorizing the payment. Then, you send it to the school or loan holder. They will complete
the bottom section of the voucher and send it to the Trust. By law, payments are made
directly to the school or loan holder, not to you. The Trust will notify you that a payment
has been made and send you another voucher, with your updated balance, to be used for
future payments. Please be sure to notify the Trust of any address changes.

WHAT ARE QUALIFIED LOANS?

You can use your education award to pay qualified student loans you have or may acquire.
The original legislation governing the education award defined “qualified student loans”
basically as student loans backed by the federal government, except for loans in your
parents’ names. Later legislation expanded the types of loans considered to be qualified to
include loans made directly to AmeriCorps members by the Alaska Commission on Higher
Education and loans made directly to members by a “state agency” which cover all or part of
their cost of attendance.

For purposes of the AmeriCorps education award, the term “state agency” includes state
institutions of higher education. For example, any loan, including short-term loans, made
directly to you by a state institution of higher education to cover all or part of the your
Cost of Attendance is a qualified loan and you may repay such a loan with your AmeriCorps
education award.

                                             ***
The legal language that defines "qualified student loans" is stated here:

any loan made, insured, or guaranteed pursuant to Title IV of the Higher Education Act of 1965 (20 U.S.C.
1070 et seq.), other than a loan made to a parent of a student pursuant to section 428B of the Act, and
any loan made pursuant to Title VII or VIII of the Public Service Act (42 U.S.C. 292a et seq.);


loans made directly to students by the Alaska Commission on Postsecondary Education; and

any loan determined by an institution of higher education to be necessary to cover a student's cost of
attendance at such institution and made directly to a student by a State agency.

                                                    * * *
If you do not know if your loans are qualified, you should ask your lenders. For federally-
backed student loans, there should be a citation on the loan papers referring to Title IV of
the Higher Education Act. For loans made by a state agency, the state agency should be
listed as the "maker" of the loan on the Promissory Note. The "maker" of every loan is the
entity that originally issued the loan to the borrower. The maker of the loan does not
change, even if another loan company purchases the loan. Thus, a promissory note is the
best evidence of who originally made the loan.

When a loan is refinanced or consolidated, the new loan must meet the definition of
"qualified student loan" in order for a payment to be made using an education award. The
original loan no longer exists.

There may be student loan programs offered by organizations that are not qualified. You
must be sure to confirm with your loan holders that the loans are qualified and meet these
definitions. A debt resulting from charging tuition on your credit card is not a qualified
student loan. (However, you may be able to be reimbursed for current educational
expenses that you paid for.)

Examples of Some Common Qualified Student Loans

Federal Student Loans: Subsidized And Unsubsidized Stafford Loans - Supplemental Loans To Students
(SLS) - Federal Consolidated Loans - Guaranteed Student Loans (former name for Staffords) - Federally
Insured Student Loans (FISL) - Direct Subsidized & Unsubsidized Stafford - Direct Subsidized &
Unsubsidized Ford Loans - Direct Consolidation Loans - National Defense Student Loan - National Direct
Student Loans – Perkins Loans - Health Education Assistance Loans (HEAL) - Health Professions Student
Loans (HPSL) - Loans For Disadvantaged Students (LDS) - Nursing Student Loans (NSL) - Primary Care
Loans (PCL)

Loans made directly to students by the Alaska Commission on Postsecondary Education

Loans made directly to students in degree programs by a state college or university


WHAT ARE QUALIFIED INSTITUTIONS OF HIGHER EDUCATION?

You can use your education awards to pay for current educational expenses at qualified
institutions of higher education. For purposes of the education award, a "qualified"
institution is one that participates in the U.S. Department of Education’s student assistance
program--i.e., it has an agreement with the U.S. Department of Education whereby students
at the school are eligible to receive at least some type of federal financial assistance to
attend the school. These are sometimes called Title IV schools. This assistance can be in
the form of a Pell Grant or one of the loans listed in the "qualified student loan" section.
You do not have to apply for financial aid to use your education award, but the school must
be one that participates in the federal student aid program.

A school may be accredited and even offer graduate degrees. However, unless it is a Title
IV school the education award, by law, cannot be used there. ("Title IV" refers to the
section of the Higher Education Act that authorizes the federal student aid program).
It is not possible to tell if a school is Title IV merely by the name of the school. Most post-
secondary educational institutions in the United States are Title IV schools. Thousands of
technical and trade schools are Title IV as well. Art schools, beauty schools, and truck
driving schools may be Title IV. In order to become a Title IV school, an institution has to
meet certain requirements and obtain an agreement with the US Department of Education.
This agreement is called a Title IV Program Participation Agreement.

To Find Out if a School is Qualified . . .

US Schools

You can ask your financial aid office if the school is a Title IV institution. If it is Title IV,
you can use your education award there. If the financial aid or admissions office says they
are not sure or they do not know, it is likely that the school is not Title IV. Another way to
find out if the school is Title IV is to see if students who attend the school are able to get
Pell grants, Perkins Loans or Stafford Loans to attend the school. (These are examples of
some of the most common types of Title IV assistance). If they are, it is a Title IV school.

Another way to find out if a school is a Title IV institution is to call the toll-free number at
the Department of Education’s Federal Student Aid Information Center between 9:00 am
and 8:00 pm (Eastern time), Monday through Friday. That number is 1-800-433-3243.
Finally, you can conduct an on-line search using the Department of Education’s web page at
http://www.fafsa.ed.gov/fotw0304/fslookup.htm.

Foreign Schools

The education award may be used to attend many schools outside the United States. If
you’re interested in using your education award to attend a foreign school, you should
always check to see if the school qualifies before enrolling

If a foreign school participates in the U.S. Department of Education's Federal Family
Education Loan (FFEL) Program, the AmeriCorps education award can be used there. You can
find out if a particular school participates in the FFEL Program by calling the Department of
Education’s toll-free number given above. If you call this number you should ask if the
school "participates in the FFEL Program." This number is not for questions concerning
using the education award because they will not be able to answer those questions. It is to
see if a foreign school participates in the FFEL program, which therefore makes it a
"qualified" school for the purposes of the education award. You should have the name and
location of the school before making the call.
Another way to approach attending schools overseas is to obtain a qualified student loan to
attend the foreign school and use the education award to repay the loan. The loan would be
paid like any other qualified student loan.

Finally, many qualified U.S. post-secondary institutions offer educational opportunities
abroad. As long as you are considered by the qualified U.S. school to be a student at the
school and the payment goes to the U.S. school, this is an allowable use of the education
award.



QUALIFIED EXPENSES TO ATTEND SCHOOLS


The AmeriCorps education award can be used to pay “current educational expenses.”
“Current educational expenses” are expenses that were incurred by you after you first
enrolled in an AmeriCorps term of service. The award cannot be used to pay for expenses
that pre-date your involvement with AmeriCorps.

Degree or Certificate Program

If you want to use your award in a degree or certificate program, it can be used to pay some
or all of your Cost of Attendance. The term "Cost of Attendance" (COA) was developed by
the U.S. Department of Education for use by Title IV schools. It is the school’s estimate of
what it will cost for a student to attend that school for a specific period of time (usually a
school year), using regulations established by Congress and the U.S. Department of
Education. For a full-time student, it can include tuition and fees and allowances for books &
supplies, room & board, transportation, and other expenses. The COA is utilized by schools
to calculate the amount of the education award that each AmeriCorps member is eligible to
use. It is important to note that every Title IV school determines the COA for its
students--this is not an amount determined by you or by the Trust.

The AmeriCorps education award can be used for that portion of the COA that has not
already been covered by other sources of financial assistance, such as scholarships, loans,
grants, and tuition or fee waivers. For example, if a school has determined that the COA for
an academic year is $12,000 and the student is receiving $8,000 worth of scholarships and
loans, the student would be eligible to use up to $4,000 of his or her education award to pay
the remaining COA. In other words, $8,000 of the $12,000 of expenses has already been
covered, leaving $4,000 not covered. You can find out from the school’s financial aid office
your Cost of Attendance.

Schools are allowed to include the cost of a computer in determining the COA for some
students. The school’s financial aid office will know if, following the U. S. Department of
Education’s regulations, the cost of a computer can be included in a student’s COA. It may
depend upon the course of study and the number of credits the student is taking.

The education award is subject to the same general rules that the school has regarding
reimbursing students for other financial aid they receive for non-institutional expenses. A
school which receives a check from the Trust may keep the amount that is owed the school
(such as tuition, fees, and, if applicable, dorm fees) and may release to you any of the COA
allowances due you – e.g. allowances for books, transportation, and off-campus room and
board (if applicable). This reimbursement can be handled in a variety of ways – some
schools write students checks while others establish accounts in the students’ names. Some
schools handle book and supply purchases by issuing students vouchers that can be used at
the school’s bookstore.

Non-degree and Non-certificate Courses

You are not limited to using your education award only for courses that are part of a
degree, certificate or other credentialed program. You can use your education award to pay
for all courses at the school in which you are enrolled as a student, such as an adult
education course, as long as the school is a Title IV school. Tuition, books, and fees for
continuing education courses offered by a Title IV university, for example, are eligible for
payment from the National Service Trust.

The Education Award and its Effect on Financial Aid

Figuring out when to use your education award and how it will affect your financial aid (for
degree and certificate programs) can be complicated.

Currently, for some student loans the education award is considered in determining the
amount of student aid for which the student is eligible and for other loans it is not taken
into consideration. The U.S. Department of Education has developed guidance for financial
aid officers on how the AmeriCorps education award should be handled.

This guidance is included in the most recent Student Financial Aid Handbook for financial aid
administrators. Financial aid officers should be familiar with how the education award is to
be treated when determining the eligibility for and the amount of any financial aid for which
an AmeriCorps member qualifies.



Take Your Voucher to Your Financial Aid Office

The Trust strongly encourages members to take their education awards to the
financial aid office of the qualified school they wish to attend. That office is
responsible for developing students' financial aid packages and for providing guidance and
expertise regarding student aid. Remember to let your financial aid office know that the
education award is considered by the IRS to be income and is taxable in the year that the
payment is sent to the school. Since income from one year can affect eligibility for certain
student aid in the following year, this fact might help you and your financial aid officer plan
when and how you might best use your award.

You should take your award to the financial aid office even if you do not plan to apply for
financial assistance. The financial aid office may direct you to another office on campus to
process the award but you should begin with the financial aid office. As a Title IV school, it
is the responsibility of the school's financial aid office to monitor all of the financial
assistance received by students. The financial aid office is able to determine how much of a
student’s award he or she is eligible to use and whether a student’s COA has been met by
other sources.
Vouchers completed by school departments such as Housing or Parking, which are unlikely
to be knowledgeable of COA issues, will be forwarded to the financial aid office for
approval before the payment can be made by the Trust.

Book Stores and the Education Award

The Trust cannot make payments to bookstores based upon a Voucher and Payment Request
form being completed solely by the bookstore. By law, a payment for current educational
expenses must be made to a qualified school. School bookstores are unable to monitor the
amount of financial assistance a student is receiving and cannot determine if the education
award will cause a student to exceed the COA. Therefore, the Trust will not pay vouchers
that are completed by bookstores unless the school's financial aid office has verified that
the information is accurate (i.e., that the COA will not be exceeded with this payment).

If it is the school's desire, the payment can be sent to the attention of the school's
bookstore, rather than to the Student Accounts or similar office at the school. But the
check will still be made payable to the Title IV school and sent to the attention of the
bookstore.



PAYMENT OF ACCRUED INTEREST

During a forbearance based on national service, interest continues to accrue on the loan.
However, you are eligible to have the National Service Trust pay all or a portion of the
interest that accumulates on your qualified student loans while you were earning your
award. These payments are made above and beyond the education awards and will not be
deducted from your education award accounts. To be eligible to have this "accrued" interest
paid, the loans must have been in a forbearance or deferment status during the service
periods and you must have successfully completed your term of service.

Generally, the Trust will pay all of the interest for full-time members who complete their
terms of service within a year and a portion of the interest for part-time members and
those full-time members who had to end their service early for compelling reasons. The
portion that the Trust pays is based on a formula contained in the regulations that govern
the National Service Trust.

The Trust cannot pay for interest that accrued outside your service period. Nor can it pay
interest if you did not earn an education award. Like payments made from a your education
award, payments for interest are considered taxable income in the year the payment is
made and will be reported to the Internal Revenue Service.

Process for Getting the Interest Paid

The Trust will pay the interest when it has received 1) verification from the project that
you have completed service and are eligible for an education award and 2) documentation
from the loan holder showing the total amount of interest that accrued during your service.
Normally this documentation is a completed Interest Accrued During National Service form
(see last page for a sample of the form). A blank copy of this form with your service
information is included in the education award packet that is mailed to you upon the
completion of your service. You should complete the top portion of the interest accrual
form and send it to your loan holders; make copies of the blank form if you have several
loan holders. Each loan holder will complete the lender portion of the form, stating the
amount of interest that accrued, and forward it to the National Service Trust. The Trust
will make the payment to your loan holder.

The Trust can also make an interest payment based on receiving a statement or bill from a
loan company if the document contains the correct dates of service (month, day, and year)
and the total amount of interest that accrued during that period. When the Trust gets the
paperwork, it will be reviewed to make sure that you have completed the service and the
dates are correct. Then, a payment will be made to the loan holder.

Income Taxes

Both interest payments and payments from education award accounts have been determined
to be taxable income. They are included as income in the tax year the payment is mailed to
the school or loan company.

The Trust will report to the IRS the total of all payments that were made on your behalf.
An IRS form 1099 (Miscellaneous Income) will be mailed to you in January following each
year in which a portion of your award was used. This form will let you know the total amount
of your payments from the previous year. Please keep us informed of any address change.

Your tax burden may be mitigated somewhat by federal income tax laws regarding
educational credits and deductions for student loan interest payments. You should contact
the IRS or your tax advisors for additional information.

National Service Trust phones:        (toll free) 1-800-507-5962
                                      (local, DC) 202-606-5000 x 347

Email address to report address change or to request a duplicate voucher:
edawardvoucher@cns.gov

Department of Education’s toll-free number: 1-800-433-3243
SAMPLE- AmeriCorps VOUCHER AND PAYMENT REQUEST FORM- SAMPLE
                       for AmeriCorps Member:                         Harold Potter                                   SSN:        123-43-1234

Section A - TO BE COMPLETED BY AMERICORPS MEMBER - The AmeriCorps member must fill out the three items in Section A. A separate
voucher must be completed for each payment authorized/requested. Then the member must send the voucher to the school or loan holder.

AWARD INFORMATION as of (date)
Balance of First Award: $2,362.50 Valid Until: 2/1/2005
                                                                    (1) Indicate the amount of the payment that you request:
Balance of Second Award: $             Valid Until
Current Balance in Account: $        2,362.50
                                                                         $ __,____.__
I authorize the amount indicated above to be paid to the loan holder or educational institution named below.

I certify that I have not been convicted, since the completion of my AmeriCorps service, of the possession or sale of a controlled
substance. I further certify that I have received either a high school diploma or its equivalent (such as a GED). I understand that a
knowing and willful false statement on this form can be punished by a fine or imprisonment or both under Section 1001 of Title 18,
USC.

(2) Signature of Member _______________________________________________                         (3) Today’s date:                   __ / __ / 200_
                                                                                                                            Month      Day          Year

If you are unable to make this certification, please write to the National Service Trust to find out what you must do to be eligible to
use the award.
.


Section B - TO BE COMPLETED BY SCHOOL OR LOAN HOLDER - The school or loan holder must complete and sign Section B.                                 Fill out
the appropriate portion depending upon whether the voucher is to repay a qualified student loan or to pay for current educational expenses. Include the
complete address where the payment should be mailed. Send the completed voucher to the address below to receive payment. See the “Guidelines
& Uses” that were sent to the student with this voucher.
If this payment is for a QUALIFIED STUDENT LOAN, the loan holder must complete this      If this payment is for CURRENT EDUCATIONAL EXPENSES, the Title IV school or
section.                                                                                 School-to-Work Program must complete this section.
1. Payoff amount (add 30 days interest):
                                                                                         1. Amount for which student is eligible. All student
            $___,___.__                                                                  aid, including the educational award, cannot exceed
                                                                                         the Cost of Attendance, or the allowed amount for
2. Type of qualified student loan: ___________________                                   non-degree programs.

A qualified student loan for the purposes of the                                                        $___,___.__
education award is:
                                                                                         2. Title IV School Code (6 digits): _____________
 a) a loan made, insured, or guaranteed pursuant to Title IV of
the Higher Education Act of 1965, other than a loan to a parent                          3. School enrollment period upon which this amount
of a student pursuant to section 428B of such Act;                                       is based. By law, a payment is made in two equal installments; one at the
                                                                                         beginning and one at the middle of the enrollment period.
b) any loan made pursuant to Title VII of VIII of the Public
Health Service Act; and                                                                      start date_________________ mid point date ________________
c) a loan determined by an institution of higher education to be
                                                                                         The individual named above is a student in an eligible program at the
necessary to cover a student’s cost of attendance at such an                             institution listed below, which has in effect a Title IV Program
institution and made directly to students by a state agency.                             Participation Agreement with the U.S. Department of Education.
                                                                                         Eligibility to participate in any of the Title IV programs has not been
3. If state agency made loan, name of agency:                                            limited, suspended, or terminated. Further, the number of students using
                                                                                         an award in the current academic year is not more than 15% of the total
__________________________________________                                               student population.

The organization listed below is the holder of the loan (which is defined as the
original lender or another person or organization to which the loan was
subsequently sold, transferred, or assigned and which has a legally enforceable
right to receive payment from the borrower).

I certify that all of the information I have provided above is true and correct. I understand that a knowing and willful false statement on this form can be
punished by a fine or imprisonment or both under Section 1001 of Title 18, USC.

________________________________________________________________________                 ___________________________________________
Signature of authorized representative of the school or loan holder                                   Telephone Number

Printed or typed name of representative_____________________________                  Dept. ___________________________             Date ____________________

Name of School or Loan Holder (Payee): __________________________________________________________________

Address_______________________________________________________________________________________________


    City____________________________________________ State _________
    Federal Taxpayer ID Number (9 digits): ___ ___ ___ ___ ___ ___ ___ ___ ___
                                                                                  Zip Code   _____ ____         -




MAIL VOUCHER TO: NATIONAL SERVICE TRUST/CNCS; 1201 NEW YORK AVENUE NW, WASHINGTON, D.C. 20525
      SAMPLE-INTEREST ACCRUED DURING NATIONAL SERVICE-SAMPLE
                 National Service Trust - Corporation for National and Community Service
   Upon the successful completion of a term of service, the National Service Trust will pay, on behalf of the borrower, all or a portion of
   the interest that accrued on a qualified student loan* during the time an education award was being earned. The loan must have
   been in a forbearance or deferment status during this period. This form is to request that the loan holder provide the interest
   amount and send the form to the Trust for payment. Payment will be made only to the loan holder. This payment, like payments
   from a member’s education award, is considered taxable income in the year the payment is made.
                                                                 INSTRUCTIONS
 FOR THE AMERICORPS MEMBER: Fill out the information in the Member Section. No more than 90 days prior to completion of service,
send a completed and
signed form to each loan holder. Your national service period runs from the date that you began your service (including any training period) to
the date you completed
your service. Contact your project if you do not know these dates. FOR THE LOAN HOLDER: Complete the Loan Holder Section and return the
form to:
The National Service Trust/CNS; 1201 New York Ave, NW; Washington, D.C. 20525

     MEMBER SECTION (Must be completed in full and signed by the AmeriCorps member upon completion of service - please
                                                         print)

     Member’s name:
                                                                               Social Security Number:

     Address:                                                                  Telephone No:




     Period of National Service (dates):      Beginning                               through
                                                               Mo        Day           Year               Mo       Day          Year
     I certify that the information above is true and correct. I authorize the release of any loan information to the National Service
     Trust.

             Borrower's signature: ___________________________________________________________________ Date: __________________________



                          LOAN HOLDER’S SECTION - Complete either A. or B. to indicate amount of interest
     A. Amount of interest accrued on member’s                            OR
     qualified       loan(s) during service period:                       <>         B. Daily interest accrual $ ______________________

          $_______________________________________
         DO NOT INCLUDE INTEREST WHICH HAS BEEN OR                                       INDICATE ANY PERIOD OF TIME WITHIN THE
     WILL BE PAID BY THE US DEPT OF EDUCATION. DO                                    SERVICE PERIOD DURING WHICH INTEREST
     INCLUDE ALL OTHER PAID AND UNPAID INTEREST.                                     DID NOT ACCRUE (SUCH AS A GRACE PERIOD)


     Name & Address of Loan Holder/Servicer
     (Where Payment Should be Sent):

     I certify that the amount designated is for interest that accrued on the qualified student loan(s)* during the service period
     indicated.
     _______________________________________________________           _________________________________________________________
     Signature of Representative of Loan Holder/Servicer                     Printed Name of Representative
     Representative's phone number: _________________________________________ Date : __________________________

       A QUALIFIED STUDENT LOAN is 1) any loan made, insured, or guaranteed pursuant to Title IV of the Higher Education Act of 1965 ,
        as amended, other than a loan to a parent of a student pursuant to Section 428B of such Act; 2) any loan made pursuant to Titles VII
        or VIII of the Public Health Service Act; and 3) any loan made directly to a student by the Alaska Commission on Postseconda ry
        Education. Examples of these loans include Federal Family Education Loans (Subsidized and Unsubsidized Stafford Loans,
        Supplemental Loans to Students (SLS), Consolidation Loans), William D. Ford Federal Direct Loans (Direct Subsidized and
        Unsubsidized Stafford/Ford Loans, and Direct Consolidation Loans), Federally Insured Student Loans (FISL), Perkins Loans, Health
        Education Assistance Loans (HEAL), Health Professions Student Loans (HPSL), Loans for Disadvantaged Students (LDS), Nursing
        Student Loans (NSL), Primary Care Loans (PCL), and loans made directly to members by the Alaska Commission on Postsecondary
        Education.

                                              SAMPLE – NOT TO BE USED