1. (a) Allocations for Fiscal Year 2015.

   1. (1) Initial Year Funds. Available program funds for initial year awards will be allocated to each participating institution in proportion to each institution's share of the state's undergraduate financial aid population with significant amounts of financial need.
   2. (2) Renewal Year Funds. Available program funds for continuation or renewal awards will be allocated in proportion to the number of prior year recipients reported for each institution, adjusted for the institution's student retention rate.

2. (b) Allocations for Fiscal Year 2016 and Fiscal Year 2017. Allocations are to be determined on an annual basis as follows:

   1. (1) The allocation base for each eligible institution will be the aggregate 9-month cost of attendance for students it reported in the most recent Financial Aid Database Report who met the following criteria:

      1. (A) were classified as Texas residents,
      2. (B) were first-time entering undergraduates enrolled at least half-time,
      3. (C) completed either the FAFSA or the TASFA, and
      4. (D) have a 9-month Expected Family Contribution less than or equal to the Federal Pell Grant eligibility cap for the year reported in the Financial Aid Database Report.

   2. (2) Each institution's percent of the available funds will equal its percent of the state-wide total cost of attendance of students who meet the criteria in (b)(1) of this section, except that:

      1. (A) if statewide funding equals or exceeds the amount allocated for FY 2015, no institution will receive less than 95 percent of its allocation for FY2015; and
      2. (B) if statewide funding is less than the amount available for FY 2015, each institution will receive an amount equal to its FY 2015 allocation, multiplied by a factor equal to the new year's statewide total appropriation divided by the FY2015 statewide appropriation.
3. (c) Verification of Data for Fiscal Year 2016 and Later. Allocation calculations will be shared with all participating institutions for comment and verification prior to final posting and the institutions will be given 10 working days, beginning the day of the notice's distribution and excluding State holidays, to confirm that the allocation report accurately reflects the data they submitted or to advise Board staff of any inaccuracies.
4. (d) Allocations for Fiscal Years 2018 and later will be made based on rules developed through the use of Negotiated rulemaking in accordance with Texas Government Code Chapter 2008 and 19 TAC, Part 1, Chapter 1, §1.14, as well as Senate Bill 215, 83rd Texas Legislature, Regular Session (2013).
5. (e) Reallocations. Institutions will have until the close of business on February 20 or the first working day thereafter if it falls on a weekend or a holiday to encumber the program funds that have been allocated to them. On that date, institutions lose claim to any unencumbered funds, and the unencumbered funds are available to the Board for reallocation to other institutions. For the institutions that request additional funds, reallocations for amounts up to the amount requested per institution will be calculated on the same basis as was used for the allocation for the relevant fiscal year. If necessary for ensuring the full use of funds, subsequent reallocations may be scheduled until all funds are awarded and disbursed.
6. (f) Disbursement of Funds to Institutions. As requested by institutions throughout the fall and spring terms, the Board shall forward to each participating institution a portion of its allocation of funds for immediate release to students or immediate application to student accounts at the institution.
7. (g) Authority to Transfer Funds. Institutions participating in a combination of the Texas Educational Opportunity Grant and Texas College Work-Study Programs, in accordance with instructions from the Board, may transfer in a given fiscal year up to the lesser of 10 percent or $20,000 between these programs.

Source Note:The provisions of this §22.262 adopted to be effective November 28, 2005, 30 TexReg 7871; amended to be effective November 20, 2013, 38 TexReg 8201; amended to be effective March 4, 2015, 40 TexReg 926.