Prison Education Programs Best Interest Determination Requirements

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Posted Date April 06, 2026 Author Federal Student Aid Electronic Announcement ID GENERAL-26-23 Subject Prison Education Programs - Best Interest Determination

This Electronic Announcement provides information for institutions with Prison Education Programs and their oversight entities on how to complete and report the best interest determination as required under 34 CFR 668.241.

The FAFSA Simplification Act (Act) was enacted into law as part of the Consolidated Appropriations Act, 2021, and amended by the Consolidated Appropriations Act, 2022. The Act eliminated the ban on Federal Pell Grant eligibility for confined or incarcerated individuals if such individuals are enrolled in an eligible Prison Education Program (PEP). For detailed information on PEPs, please refer to Dear Colleague Letter GEN 23-05. This announcement specifically focuses on the requirement for an oversight entity to make a best interest determination about an eligible PEP.

Oversight Entity Responsibilities

The PEP regulations under 34 CFR 668.236 (a)(3), 668.241(d), and (e) require that an oversight entity determine that a PEP is operating in the best interests of students (best interest determination). An oversight entity must conduct an initial best interest determination of an institution’s PEP two years after the U.S. Department of Education (Department) approves the PEP. The oversight entity is the appropriate state department of corrections, the Federal Bureau of Prisons, or other entity that is responsible for overseeing a correctional facility. An institution must submit to the Department subsequent best interest determinations for as long as the PEP is operating, and not less than 120 calendar days prior to the expiration of an institution’s Program Participation Agreement (PPA).

Initial Best Interest Determination

The initial best interest determination must be completed by the later of

• 90 days after the initial two-year period of approval (two years plus the date of program approval on the Eligibility and Certification Approval Report [ECAR]); or
• if the end of the initial two-year period of approval occurs within 12 months of the recertification of an institution’s PPA, not less than 120 days before the PPA expires.

Note: Oversight entities can also make determinations between subsequent evaluations based on their own determined regular monitoring and evaluation.

As part of the best interest determination submitted to the Department, the institution must provide the following:

1. Name of Educational Institution
2. Name of Oversight Entity
3. Name of Correctional Facility
4. Name of Program(s)
5. Number of current PEP students (in each PEP if the institution offers more than one program)
6. Number of years program(s) has been operating as a PEP at this location

And as a part of the institution’s report, the oversight entity certifies in the same document the following:

1. Date range that the best interest determination was conducted (when it began and concluded)
2. Name, title, and affiliation of relevant stakeholders
3. Required criteria listed in DCL GEN 23-05 (instructors, transferability of credits, academic and career advising, ability of students to transfer credits to any location of the institution) that were evaluated for each PEP
4. A definitive one sentence statement that the PEP passed or failed the best interest determination

Institutions should have their initial best interest determination completed based on the above criteria and submit it through Federal Student Aid’s (FSA) Partner Connect system. Once submitted to the Department through Partner Connect, the institution must still maintain this documentation from the oversight entity on file per § 668.241(f). Institutions must maintain documentation of the best interest determination used by the oversight entity for as long as the program is active or, if the program is discontinued, for three years following the date of discontinuation.

Subsequent Best Interest Determinations

After the institution’s initial best interest determination, the institution must obtain subsequent evaluations of each PEP from the responsible oversight entity not less than 120 calendar days prior to the expiration of the institution's PPAs. Each subsequent evaluation must include the entire period that begins after the end date of the date range of the prior determination and be based on students enrolled in the PEP since the prior determination. Each subsequent determination should include the elements listed above and must be submitted to the Department through Partner Connect no later than 30 days following completion of the subsequent determination.

Best Interest Determination and FSA Partner Connect

If an institution has a best interest determination currently due, the institution must complete the determination per the requirements outlined above and submit it to the Department through the Application for Approval to Participate in the Federal Student Financial Aid Programs (or E-App) in FSA’s Partner Connect system. Institutions should select “update” as the purpose and “PEP” as a sub-purpose.  Institutions should then navigate to the “Educational Programs” section. In the additional information section, the institution should add that they are uploading the “Best Interest Determination” letter.  The institution should then go to the document upload table and select “Upload Document – Other Document.” In the description, the institution should list that it is a “PEP Best Interest Determination Letter,” upload the document, and submit it. In a future update, the “PEP Best Interest Determination” document will be added as an option to the drop-down list.

Institutions with best interest determinations due prior to this notice of instruction to submit their best interest determination to the Department will receive safe harbor from adverse or negative action from the Department, if the institution had the best interested determination completed as required above.

Failure of the Initial or Subsequent Best Interest Determination

If an oversight entity does not find the PEP to be in the best interest of students, the PEP will lose its Title IV, Higher Education Act of 1965 (HEA) eligibility. Confined or incarcerated individuals enrolled in the ineligible program may no longer receive Pell Grant funds for any payment period that begins following that determination.

If a PEP fails the initial best interest determination, the institution must inform the Department within 15 business days by emailing pep@ed.gov. Institutions will be required to email pep@ed.gov even when the ability to upload the best interest determination is available in Partner Connect.

A program that loses Title IV, HEA eligibility because the institution’s oversight entity determined that the program was not in the best interest of students may reapply for eligibility following a new determination by the oversight entity that states that they have determined that the program is operating in the best interest of students. The institution must follow the instructions in Electronic Announcement GEN-24-18 to resubmit the program for Title IV, HEA eligibility.  We encourage PEPs that fail the best interest determination to work proactively with the appropriate oversight entity to reestablish eligibility.

Contact Information

The Department appreciates institutions that are offering valuable PEPs to confined or incarcerated individuals. For questions about the information in this Electronic Announcement, please email pep@ed.gov. You can also find more information about PEPs, including Federal Register notices, Electronic Announcements, the Free Application for Federal Student Aid (FAFSA ®) for Incarcerated Students, and much more, on the Knowledge Center’s PEP Topics Page.