; and (B) ratably reduce the amount of the sum of such loan authority of all participating institutions not described in subparagraph (A). (5) Estimating the year preceding the first year of allocations For award year 2021–2022, in calculating an institution’s undergraduate student need under paragraph (1)(C) and an institution’s graduate student need under paragraph (1)(D), the Secretary may estimate the data with respect to the preceding award year required to make such calculations. (c) Definitions In this section: (1) Annual loan authority The term annual loan authority means the total original principal amount of loans that may be allocated and made available for an award year to make Federal Direct Perkins Loans under section 455A. (2) Average cost of attendance The term average cost of attendance has the meaning given the term in section 4202(e)(5)(B). (3) Graduate student need The term graduate student need means, with respect to a graduate student for an award year, the lesser of the following: (A) The amount equal to (except the amount computed by this subparagraph shall not be less than zero)— (i) the average cost of attendance for the preceding award year, minus (ii) such graduate student’s expected family contribution (computed in accordance with part F of this title) for the preceding award year. (B) The total annual loan limit for a Federal Direct Unsubsidized Stafford Loan. (4) Undergraduate student need The term undergraduate student need means, with respect to an undergraduate student for an award year, the lesser of the following: (A) The total of the amount equal to (except the amount computed by this clause shall not be less than zero)— (i) the average cost of attendance for the award year, minus (ii) such undergraduate student’s expected family contribution (computed in accordance with part F of this title) for the preceding award year. (B) The total loan annual limit for a Federal Direct Unsubsidized Stafford Loan and a Federal Direct Loan. (5) Eligible institution The term eligible