Is It “NEG REG” or “REG NEG”?

Jeff Baker
Program Development Division
Student Financial Assistance

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AGENDA
HTHE STATUTES
HTHE LEGISLATIVE PROCESS
HTHE SECRETARY’S RESPONSIBILITIES
HTHE REGULATIONS
HNEGOTIATED RULEMAKING
HTHE REQUIREMENT
HTHE RESPONSIBILITY

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AGENDA - continued
HNEGOTIATED RULEMAKING -continued
HTHE STEPS
HTHE MEMBERS
HRULEMAKING STEPS
H2000 PROPOSED RULES

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THE STATUTES

H THE HIGHER EDUCATION ACT OF

1965, as amended
(20 U.S.C. 1001, et.seq.).
H The Department of Education
Organization Act
H The Privacy Act
H The Freedom of Information Act
H Others
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HIGHER EDUCATION ACT OF 1965
HTitle I: Institutional Eligibility
HTitle IV: Student Assistance
H Part A: Grants - Pell,FSEOG,etc.
H Part B: FFELP
H Part C: FWS
H Part D: Direct Loans
H Part E: Perkins Loans

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HIGHER EDUCATION ACT OF 1965
HTitle IV: Student Assistance
H Part F: Needs Analysis and COA
H Part G: General Provisions-Student
Eligibility, etc.
H Part H: Program Integrity

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Legislative Process
HAuthorizing Committees
HRequest Proposals
HHold Hearings
HDraft Proposed Legislation
HDebate Proposals
HApprove Bill for Submission to
Respective House

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Legislative Process
HFull House and Senate
HDebate Proposed Law
HPass Their Version of Bill
HAppoint Conference Committee Member
HConference Committee
HReconcile Bills
HVotes on Final Language
HRefers Final Language to Houses
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Legislative Process
HFull House and Senate
HDebate Proposed Law
HFloor Amendments
HPass Final Legislation
HEnrolled Bill
HSent to President
HPresident Signs Into Law
HSecretary Implements
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Secretary of Education’s Responsibility
HAdvise Congress
HPropose Legislation
HProvide Technical Assistance
HAssist with Constituent Issues
HRegulates Where Needed
HEnforces Law and Regulations
HCommunicates With Interested
Parties and the Public
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The HEA The Regulations

HEA The
Reg
ulati
ons

And Think:
We Started With
Just 10
Commandments
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Code of Federal Regulations
Chapter 34 (34 CFR)

HPart 86 - DRUG-FREE SCHOOLS

HPart 99 - FAMILY EDUC RIGHTS AND
PRIVACY (FERPA)
HPart 600 - INSTITUTIONAL ELIG.
HPart 602 - ACCREDITING AGENCIES
HPart 603 - STATE AGENCIES
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The Regulations - continued

H Part 668 - GENERAL PROVISIONS

H Part 673 - GEN PROVISIONS -
Campus Based Programs
H Part 674 - FEDERAL PERKINS LOAN
H Part 675 - FEDERAL WORK-STUDY
H Part 676 - FEDERAL SEOG

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The Regulations - continued

HPart 682 - FFEL

HPart 685 - FEDERAL DIRECT LOAN
HPart 690 - FEDERAL PELL GRANT
HPart 692 - LEAP/Special LEAP (SSIG)
HPart 693 - GEAR UP (NEISPP)

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Negotiated Rulemaking
(NEG REG)
H Required by the HEA (Sec. 492A)
H All parts of Title IV -- All the time
H Goal: To develop Notices of Proposed
Rulemaking (NPRM) that reflect a final
consensus of the negotiating committee
H Consensus: There must be no dissent by
any member for the committee to have
reached consensus.
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2000 Negotiated Rulemaking
HSecretary Delegated, Under the Deputy
Secretary, Responsibility to:
HMaureen McLaughlin, Deputy Assistant
Secretary, OPE
HJack Kristy, Acting Deputy General
Counsel
HStarted February 3, 2000
HTwo Teams
HI. Loan Issues
HII. Other Issues 16 We Help Put America Through School
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Neg Reg Process

HSecretary Holds Meetings to Consider

Proposed Topics
HSecretary Proposes Topics
HMeetings with Interested Parties to
Discuss Neg Reg Process
HSolicit Nominations for Neg Reg Non-
Federal Members
HSelect Non-Federal Members
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Non-Federal Members
H American Association of Collegiate Registrars
and Admissions Officers
H American Association of Cosmetology Schools
H American Association of State Colleges and
Universities
H American Association of Community Colleges
H American Council on Education
H Association of Jesuit Colleges and Universities
H Career College Association
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Non-Federal Members
H Coalition of Higher Education Assistance
Organizations
H Coalition of Publicly Traded Educational
Institutions
H Consumer Bankers Association
H Education Finance Council
H Education and Loan Management Resources
H Legal Services
H NAFSA: Association of International
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Non-Federal Members
H National Accrediting Commission of
Cosmetology Arts and Sciences
H National Association of College and University
Business Officers
H National Association of Independent Colleges
and Universities
H National Association of Student Financial Aid
Administrators
H National Association for State Student Grant
and Aid Programs
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Non-Federal Members
H National Association of State Universities and
Land-Grant Colleges
H National Association of Student Loan
Administrators
H National Council of Higher Education Loan
Programs
H National Direct Student Loan Coalition
H Sallie Mae, Inc.
H Student Loan Servicing Alliance
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Non-Federal Members
H The College Fund/United Negro College Fund
H United States Student Association
H US Public Interest Research Group
H University Continuing Education Association.

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Neg Reg Process - continued
H Committee Approves Protocols
HCommittee Finalizes Agenda Topics
HED Submits Thoughts and Ideas
HCommittee Reacts
HNegotiations Begin
HED Provides Draft Regulatory Language
HNegotiations Continue

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Neg Reg Process - continued
H Negotiations Continue
H Negotiations Continue
H Consensus Reached
HNPRM Regulatory Language Published
as Agreed
H No Consensus Reached
H Secretary Publishes without regard
to negotiations
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NEG
Rulemaking Steps
H ED Writes Preambles
H Internal Review of NPRM Package
HDeputy Secretary
HOMB
HBudget Implications
HOPE Approval
HSFA Approval
HNeg Reg Committee Reviews Preambles
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Rulemaking Steps - continued
HED May Make Changes to Preambles
HSecretary’s Approval
HNPRM Published
HSubmitted to the Federal Register
HPosted to IFAP
H30- 90 Day Comment Period ED
HED Reviews Comments
HED Decides on Changes
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Rulemaking Steps - continued
H ED Writes Analysis of Comments and
Changes, if any
H Internal Approval (Same as for NPRM)
H Submits for Publication in the Federal
Register - Publish by November 1
H Final Rule Effective Usually Following
July 1.

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Proposed Rules (NPRMs)
HTo Be Published in July --
H Cohort Default Rates
H Federal Perkins Loans
H Guaranty Agency Due Diligence, etc.
H Teacher Loan Forgiveness (FFEL/DL)
H Death and Disability Discharges
H General Provisions Issues
H Special LEAP (SLEAP)
H Cash Management
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FFEL/DL Cohort Default Rates

H Restructure and revise cohort default

rate provisions for clarity and
consistency.
H Change of ownership - Branches,
locations, mergers, acquisitions, etc.
H Revised Treatment when rate > 40%
H Definition of Default for ICR Payments

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Federal Perkins Loan

H Clarification of Collection Rate for

Rehabilitated Loans
H Bankruptcy Filing for State Schools
H Easier Assignment of Defaulted
Loans

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Guaranty Agency Due Diligence, etc.

HStreamlined Post-Default Due

Diligence
HClosed School Discharges
HRetroactive Deferments
HLow Income Deferment Based on AGI
or Monthly Income

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Teacher Loan Forgiveness

HAmount: $5,000 (FFEL and DL)

HBorrower Eligibility
HNew Borrower as of 10/1/98
HFive Years Teaching on Low-Income
School
HAt Least One Year After 1997-98

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Death & Disability Discharges

H OIG Report
H All Three Title IV Loan Programs
H Establish stronger evidentiary
requirements for death discharges.
H Modify Definition of Disability
H Remove Return to School Condition
H SSA Determination ???
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Death & Disability Discharges
H Establish Conditional Discharge
H Suspension of Collections
H Three to Five Years
H No Interest Accrual
H Earnings Thresholds
H Income
H Months
H Loan Discharged or Activated

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General Provisions

HChange of Ownership
H Publicly traded corporation.
H Public institutions.
HApplication procedures
HBranches/Additional Locations
H Elimination of Paper Financial Aid
Transcripts (FATs)
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Special LEAP (SLEAP)

HImplements New State Run Program

HState Matching Requirements
HState MOE Requirements
HCalculation of State Award
HDefine Eligible Students

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Special LEAP (SLEAP)
Permissible Activities
HIncrease grants awarded in LEAP
HTransition programs to postsecondary
HGrants for students who wish to enter
careers in information technology or
other fields of study determined by the
State to be critical to the State’s
workforce needs.
HCommunity service work-study activities
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Special LEAP (SLEAP)
Permissible Activities
HScholarship program for students who
wish to enter teaching.
HScholarship program for students who
wish to earn a degree in mathematics,
computer science, or engineering.
HEarly intervention programs, mentoring
programs, and career education programs.
HMerit or academic scholarships to eligible
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Cash Management -FFEL Delivery

HModify Rule for Re-Checking Eligibility

H Similar to Secretary’s Just-in-Time
H FFELP “Hold and Release” Process

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