THOMAS P. DiNAPOLI
STATE COMPTROLLER

110 STATE STREET
ALBANY, NEW YORK 12236

STATE OF NEW YORK
OFFICE OF THE STATE COMPTROLLER

June 22, 2010

Dr. David Steiner
Commissioner
State Education Department
State Education Building, Room 408
89 Washington Avenue
Albany, New York 12234
Ms. Elsa Magee
Acting President
Higher Education Services Corporation
99 Washington Avenue
Albany, New York 12255
Re: College of New Rochelle
Report 2009-T-4
Dear Dr. Steiner and Ms. Magee:
According to the State Comptroller’s authority as set forth in Article V, Section 1 of the State
Constitution, Article II, Section 8 of the State Finance Law, and a Memorandum of Agreement dated
December 1, 1989, involving the State Comptroller, the Commissioner of Education, the President
of the Higher Education Services Corporation (HESC), and the Director of the Budget, we audited
the records and procedures used in administering the Tuition Assistance Program (TAP) at the
College of New Rochelle (New Rochelle) for the 2005-06 through 2007-08 academic years.
Summary Conclusions
In accordance with Article 14, Section 665(3)(b) of the New York State Education Law
(Law), we determined that New Rochelle was overpaid $62,341 because school officials incorrectly
certified five students as eligible for TAP awards. We tested the accuracy of the 20,737 TAP
certifications the college awarded for the three-year period that ended on June 30, 2008, by
reviewing a sample of 150 randomly-selected awards, and evaluating the results using statistical
methods. From our random sample, we disallowed four awards totaling $4,057. A projection of
these audit disallowances to the entire population, using statistical sampling methods and a 95
percent single-sided confidence level, results in an audit disallowance of $59,841. We also
disallowed one award for $2,500 based on our review of other awards from outside the sample
period. This award was not projected to the population. Therefore, we recommend that HESC
recover a total of $62,341, plus applicable interest, from New Rochelle.

 -2Background
New Rochelle is an independent four-year college located in Westchester County. In addition
to its main campus in New Rochelle, the school has five other campuses in the Bronx, Manhattan,
and Brooklyn. Founded in 1904, New Rochelle offers a variety of degree programs that have been
approved by the State Education Department (SED) for tuition assistance eligibility. The school’s
current enrollment is about 5,000 students and its tuition is about $13,000 per semester for its School
of Arts and Sciences and School of Nursing. Its School of New Resources and Graduate School
charge students per credit enrolled.
TAP is the largest of the various student grant and scholarship programs administered by
HESC. It is an entitlement program designed to provide tuition aid to eligible full-time students who
are enrolled in a variety of eligible programs.
A draft copy of this report was provided to HESC, SED and New Rochelle officials for their
review and comment. We have considered their comments in preparing this audit report.
Audit Scope, Objective, and Methodology
The objective of our performance audit was to determine whether New Rochelle’s
management complied with the Law and the Commissioner of Education’s Rules and Regulations,
Title 8, NYCRR (Regulations) for certifying students as eligible for TAP awards. The scope of our
audit did not include a review of the process HESC follows in determining the amount of such
awards.
According to HESC records, New Rochelle officials certified 20,737 TAP awards totaling
$35,845,420 that were paid on behalf of 7,578 students during the three academic years that ended
June 30, 2008. We reviewed a random sample of 150 TAP awards totaling $251,144 that were made
to 149 students during that period and evaluated the results using statistical sampling methodologies.
We also reviewed other awards that came to our attention during the audit.
In planning and performing our audit of New Rochelle, we reviewed management’s internal
control system. Our audit was limited to a preliminary review of this system to obtain an
understanding of the environment and the flow of transactions through the college’s accounting
system and other systems that would support the claims for student financial aid.
New Rochelle’s management is responsible for complying with the Law and the Regulations.
In connection with our audit, we performed tests of New Rochelle’s compliance with certain
provisions of the Law and Regulations. Our objective in performing these tests was to obtain
reasonable assurance that the students who received TAP awards were eligible for them. Our
objective was not to provide an opinion on New Rochelle’s overall compliance with such provisions.
Our audit found that, for the transactions and records tested, New Rochelle generally complied with
these provisions, except as noted in the following sections of this report.

We conducted our performance audit in accordance with generally accepted government
auditing standards. Those standards require that we plan and perform the audit to obtain sufficient,

 -3appropriate evidence to provide a reasonable basis for our findings and conclusions based on our
audit objectives. We believe that the evidence obtained provides a reasonable basis for our findings
and conclusions based on our audit objectives.
In addition to being the State Auditor, the Comptroller performs certain other constitutionally
and statutorily mandated duties as the chief fiscal officer of New York State. These include
operating the State’s accounting system; preparing the State’s financial statements; and approving
State contracts, refunds, and other payments. In addition, the Comptroller appoints members to
certain boards, commissions, and public authorities, some of whom have minority voting rights.
These duties may be considered management functions for purposes of evaluating organizational
independence under generally accepted government accounting standards. In our opinion, these
functions do not affect our ability to conduct independent audits of program performance.
Audit Results
The following table summarizes the disallowances that resulted from our audit:

Reasons for Disallowances

Number of
Awards

Amount

Total

Disallowances from the Statistical Sample:
Students Not in Full-Time Attendance
Student Not in Good Academic Standing
Student Not Matriculated
Over-Certified Tuition
Total Disallowance from the Statistical Sample
Less: Disallowance for More Than One Reason
Net Disallowance from the Statistical Period
Projected Amount

2
1
1
1
5
(1)
4

$2,831
869
357
78
4,135
(78)
$4,057
$59,841

Disallowance from Outside the Statistical Sample Period:
Student Not in Full-Time Attendance
Total Disallowance from Outside the Statistical
Sample Period
Total Audit Disallowance

1
1

$2,500
2,500
$62,341

The disallowances are discussed in the following paragraphs. Students’ names and related
information were provided separately to New Rochelle officials.

 -4Students Not Meeting Full-Time Requirements
Criteria - Section 661 of the Law requires students to be in full-time attendance to be eligible for
their TAP awards. Section 145-2.1 of the Regulations states, in part, that full-time study at a degreegranting school is defined as enrollment for at least 12 semester hours for a semester of 15 weeks or
its equivalent. SED’s Memorandum to Chief Executive Officers No. 86-17 states that “basic to the
payment of State student aid is the requirement that courses that make up a student’s minimum
course load be creditable toward the degree, diploma or certificate program in which the student is
enrolled.”
Audit Determination - We disallowed three awards (two awards from our statistical sample period
and one from outside the period) paid on behalf of three students who not did not meet the full-time
requirement. Two students registered for less than a full-time course load. The third student enrolled
in courses that were not creditable toward her degree.
School Officials’ Position - School officials agree with these disallowances.
Student Not in Good Academic Standing
Criteria - Section 665(6) of the Law requires that students be in good academic standing to qualify
for TAP awards. To maintain such standing, a student is required by Section 145-2.2 of the
Regulations to maintain satisfactory academic progress toward completion of a program and to
pursue the program of study in which he or she is enrolled. To maintain satisfactory academic
progress, a student must accrue at least a certain minimum number of credits and earn a specified
minimum cumulative grade point average, as required on the chart of satisfactory academic progress
published by the school and approved by SED. A student is pursuing the approved program of study
if, during each term of study for which an award is received, the student receives a passing or failing
grade in a predetermined percentage of the minimum full-time course load required to qualify for the
appropriate level of TAP payment.
A student who fails to maintain good academic standing loses TAP eligibility. Students can
regain good academic standing by making up the deficiencies at their own expense, obtaining a TAP
waiver, remaining out of school for at least one calendar year, or transferring to another institution.
SED’s Memorandum to Chief Executive Officers No. 81-12 states that the requirements for good
academic standing may be waived for “exceptional or extraordinary cases.”
Audit Determination - We disallowed one sample term award for a student who did not maintain
good academic standing. The student lost good academic standing and obtained a TAP waiver;
however, we found that the school did not have adequate documentation justifying the waiver.
School Officials’ Position - School officials agree with this disallowance.
Student Not Matriculated
Criteria - Section 661 of the Law requires that students who received their first financial aid
payment in the 1996-1997 academic year to the 2006-2007 academic year to have a certificate of
graduation from a high school or the equivalent; or to have achieved a passing score, as determined

 -5by the United States Secretary of Education, on a federally-approved examination. Students who
received their first financial aid payment in the 2007-2008 academic year and thereafter must have a
certificate of graduation from a United States high school or the equivalent; or must have achieved a
passing score, on a federally-approved examination that has been identified by the Board of Regents
as satisfying eligibility requirements and that is independently administer and evaluated by the
Commissioner of Education.
Audit Determination - We disallowed one sample term award paid on behalf of a student who was
not properly matriculated. School officials did not have evidence of high school graduation or the
equivalent for this student.
School Officials’ Position - School officials agree with this disallowance.
Over-Certified Tuition
Criteria - Section 665(3)(a) of the Law requires that participating institutions certify to HESC the
actual amount of tuition liability incurred by each student receiving a TAP award.
Audit Determination - We partially disallowed one sample term award where the school reported a
higher tuition amount to HESC than was actually charged to the student. Had the school reported
the correct tuition liability, the student would have been entitled to a reduced TAP award.
School Officials’ Position - School officials agree with this disallowance.
Other Matters Needing Attention
The following findings do not result in audit disallowances. They pertain to control issues
that New Rochelle officials need to address:
Accuracy of Transcripts
Criteria - Section 52.2(e) of the Regulations requires colleges to "maintain for each student a
permanent, complete, accurate, and up-to-date transcript of student achievement at the institution.
This document will be the official cumulative record of the student's cumulative achievement."
Audit Determination - We found that the grade point average and/or the number of credits earned
were recorded incorrectly on at least 11 transcripts that we reviewed for students in our audit
sample.
School Officials’ Position - New Rochelle officials stated that the transcript issues identified have
been corrected.
Refunds to Students
Criteria - Section 2205.3(e) of HESC Regulations requires that within 45 days from the receipt of
financial aid payment, institutions must refund to the student any amount received in excess of funds
owed the institutions or, with written consent of the student, apply such funds to subsequent terms.

 -6Audit Determination - We identified six students for whom payments to the school on their behalf
were greater than the school’s charges for tuition, fees, etc. These students are due refunds. For
example:




One student is owed $1,025 since May 2006.
Another student is owed $125 since October 2006.
A third student is owed $795 since May 2007.

School Officials’ Position - New Rochelle officials stated that refund checks had been issued, but
were subsequently voided because the students did not pick them up. New Rochelle officials stated
that they have since reissued the checks.
Recommendations to the Higher Education Services Corporation
1.

Recover the $62,341, plus applicable interest, from the College of New Rochelle for its
incorrect TAP certifications.

2.

Ensure that College of New Rochelle officials comply with the Higher Education Services
Corporation requirements relating to certifying accurate tuition amounts and processing
refunds in a timely manner.
Recommendation to the State Education Department

Ensure that College of New Rochelle officials comply with the State Education Department
requirements relating to good academic standing, full-time attendance, matriculation, and accuracy
of transcripts cited in this report.
Major contributors to this report were Cindi Frieder, Gene Brenenson, Ryan Wendolowski,
Farhan Ahmad and Lillian Fernandes.
We wish to express our appreciation to the management and staff of the College of New
Rochelle for the courtesies and cooperation extended to our auditors during this audit.
Very truly yours,

Frank J. Houston
Audit Director

cc: Dr. Stephen J. Sweeny, College of New Rochelle
Judith Huntington, College of New Rochelle
Tom Lukacs, Division of the Budget