Title 20 — EducationRelease 119-73
§1096 Administrative expenses
Title 20 › Chapter CHAPTER 28— - HIGHER EDUCATION RESOURCES AND STUDENT ASSISTANCE › Subchapter SUBCHAPTER IV— - STUDENT ASSISTANCE › Part Part G— - General Provisions Relating to Student Assistance Programs › § 1096
Summary
The Education Secretary must set aside money from each year’s appropriation for the federal student‑aid program to pay colleges for running the aid programs. Each institution with an agreement under subpart 1 of part A gets $5 for every student who receives that aid. Schools with agreements under subpart 3 of part A, part C, or part E also get an annual admin payment. That payment is 5% of the school’s first $2,750,000 in relevant student‑aid spending, plus 4% of spending between $2,750,000 and $5,500,000, plus 3% of spending above $5,500,000. The spending total includes certain grants, student compensation, and the principal of loans made from the school’s loan fund, but excludes loans the school has referred under section 1087cc(a)(4)(B). The Secretary must also pay 100% of a school’s costs to run the immigration‑status verification required under section 1091(g). The money may only be used to administer those aid programs. If a school has many part‑time or independent students, it must use a fair share of the funds to provide help at times and places that meet those students’ needs.
Full Legal Text
Title 20, §1096
Education — Source: USLM XML via OLRC
(a)From the sums appropriated for any fiscal year for the purpose of the program authorized under subpart 1 of part A of this subchapter, the Secretary shall reserve such sums as may be necessary to pay to each institution with which he has an agreement under section 1094 of this title, an amount equal to $5 for each student at that institution who receives assistance under subpart 1 of part A. In addition, an institution which has entered into an agreement with the Secretary under subpart 3 of part A or part C,11 So in original. of this subchapter or under part E of this subchapter shall be entitled for each fiscal year which such institution disburses funds to eligible students under any such part to a payment for the purpose set forth in subsection (b). The payment for a fiscal year shall be payable from each such allotment by payment in accordance with regulations of the Secretary and shall be equal to 5 percent of the institution’s first $2,750,000 of expenditures plus 4 percent of the institution’s expenditures greater than $2,750,000 and less than $5,500,000, plus 3 percent of the institution’s expenditures in excess of $5,500,000 during the fiscal year from the sum of its grants to students under subpart 3 of part A, its expenditures during such fiscal year under part C for compensation of students, and the principal amount of loans made during such fiscal year from its student loan fund established under part E, excluding the principal amount of any such loans which the institution has referred under section 1087cc(a)(4)(B) of this title. In addition, the Secretary shall provide for payment to each institution of higher education an amount equal to 100 percent of the costs incurred by the institution in implementing and operating the immigration status verification system under section 1091(g) of this title.
(b)(1)The sums paid to institutions under this part are for the sole purpose of administering the programs described in subsection (a).
(2)If the institution enrolls a significant number of students who are (A) attending the institution less than full time, or (B) independent students, the institution shall use a reasonable proportion of the funds available under this section for financial aid services during times and in places that will most effectively accommodate the needs of such students.
Legislative History
Notes & Related Subsidiaries
Editorial Notes
Prior Provisions
A prior section 1096, Pub. L. 89–329, title IV, § 489, as added Pub. L. 96–374, title IV, § 451(a), Oct. 3, 1980, 94 Stat. 1453; amended Pub. L. 97–35, title V, § 537(a)(2), Aug. 13, 1981, 95 Stat. 456, related to administrative expenses, prior to the general revision of this part by Pub. L. 99–498.
Amendments
2009—Subsec. (a). Pub. L. 111–39 substituted “has referred under section 1087cc(a)(4)(B)” for “has agreed to assign under section 1087cc(a)(6)(B)” and “1091(g)” for “1091(h)”. 2008—Subsec. (b)(1). Pub. L. 110–315 substituted “administering” for “offsetting the administrative costs of”. 1993—Subsec. (a). Pub. L. 103–208, § 2(k)(6), repealed Pub. L. 102–325, § 446(c). See 1992 Amendment note below. Pub. L. 103–208, § 2(h)(44), substituted “1091(h) of this title” for “1091(c) of this title”. 1992—Subsec. (a). Pub. L. 102–325, § 493(a)(3), substituted “subpart 3” for “subpart 2” in two places. Pub. L. 102–325, § 493(a)(1), (2), struck out “(other than section 1087–57 of this title)” after “or part C” in second sentence and struck out fourth sentence which read as follows: “The payment for a fiscal year for the purpose of subsection (b) with respect to section 1087–57 of this title shall be payable from each allotment under part C in accordance with
Regulations
of the Secretary, and shall be 10 percent of the institution’s expenditures during such fiscal year under such section.” Pub. L. 102–325, § 446(c), which directed amendment identical to amendment by Pub. L. 102–325, § 493(a)(1), (2), above, was repealed by Pub. L. 103–208, § 2(k)(6). Subsec. (b). Pub. L. 102–325, § 493(b), designated existing provisions as par. (1) and added par. (2). 1987—Subsec. (a). Pub. L. 100–50 made technical amendment to reference to section 1087–57 of this title to correct reference to corresponding section of original Act, requiring no change in text. 1986—Subsec. (a). Pub. L. 99–603 inserted provision directing the Secretary to pay the costs incurred by institutions of higher education in implementing and operating the immigration status verification system under section 1091(c) of this title.
Statutory Notes and Related Subsidiaries
Effective Date
of 2009 AmendmentAmendment by Pub. L. 111–39 effective as if enacted on the date of enactment of Pub. L. 110–315 (Aug. 14, 2008), see section 3 of Pub. L. 111–39, set out as a note under section 1001 of this title.
Effective Date
of 1993 AmendmentAmendment by Pub. L. 103–208 effective as if included in the Higher Education
Amendments
of 1992, Pub. L. 102–325, except as otherwise provided, see section 5(a) of Pub. L. 103–208, set out as a note under section 1051 of this title.
Effective Date
of 1992 AmendmentAmendment by section 446(c) of Pub. L. 102–325 effective Oct. 1, 1992, see section 2 of Pub. L. 102–325, set out as a note under section 1001 of this title. Amendment by section 493 of Pub. L. 102–325, relating to payments for administrative expenses, applicable with respect to funds provided for award years beginning on or after July 1, 1993, see section 498(7) of Pub. L. 102–325, set out as a note under section 1088 of this title.
Effective Date
of 1987 AmendmentAmendment by Pub. L. 100–50 effective as if enacted as part of the Higher Education
Amendments
of 1986, Pub. L. 99–498, see section 27 of Pub. L. 100–50, set out as a note under section 1001 of this title.
Effective Date
of 1986 AmendmentAmendment by Pub. L. 99–603 effective Oct. 1, 1987, see section 121(c)(2) of Pub. L. 99–603, set out as a note under section 502 of Title 42, The Public Health and Welfare.
Reference
Citations & Metadata
Citation
20 U.S.C. § 1096
Title 20 — Education
Last Updated
Apr 6, 2026
Release point: 119-73