Procedures for validating data reported by students and parents on an application for Basic Educational Opportunity Grants were developed in 1978 for the U.S. Office of Education (OE). Validation activities include: validation of flagged Student Eligibility Reports (SERs) for students whose schools are part of the Alternate Disbursement System; validation of flagged SERs that could not be resolved at schools that act as the disbursing agent; validation of cases referred by schools that find possible misreporting or discrepancies with the SER; validation of SERs selected by OE that may contain errors; and creating payment schedules and collecting funds for students who have received Basic Grant overpayments. The procedures cover: methods for recording and monitoring each type of referral; validating cases referred by schools and OE; providing a telephone service to answer questions about validation; recovering Basic Grant overpayments; and creating a file system to ensure proper storage of materials and timely processing of validation and overpayment recovery cases. Sample letters to be used in the different situations are appended, making up about one-third of the document. (SW)