The Secretary of Education (Secretary) announces his intention to establish four negotiated rulemaking committees to draft proposed rules to implement Title IV of the Higher Education Act of 1965, as amended by the Higher Education Amendments of 1998. Th

[Federal Register: December 23, 1998 (Volume 63, Number 246)]

[Proposed Rules]               

[Page 71205-71208]

From the Federal Register Online via GPO Access [wais.access.gpo.gov]

[DOCID:fr23de98-26]



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Part IV






Department of Education






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34 CFR Chapter VI




Office of Postsecondary Education; Higher Education Act of 1965; Notice 

of Intent To Establish Negotiated Rulemaking Committees; Proposed Rule



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DEPARTMENT OF EDUCATION


Office of Postsecondary Education


34 CFR Chapter VI



Higher Education Act of 1965; Notice of Intent To Establish 

Negotiated Rulemaking Committees


AGENCY: Department of Education.


ACTION: Notice of negotiated rulemaking.


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SUMMARY: The Secretary of Education (Secretary) announces his intention 

to establish four negotiated rulemaking committees to draft proposed 

rules to implement Title IV of the Higher Education Act of 1965, as 

amended by the Higher Education Amendments of 1998. The Secretary 

further announces the organizations or groups believed to represent the 

interests that should participate in the negotiated rulemaking process. 

The Secretary intends to select participants for the negotiated 

rulemaking process from nominees of these organizations or groups. The 

Secretary requests nominations for additional participants from anyone 

who believes that the organizations or groups listed do not adequately 

represent the statutory list of interests.


DATES: The deadline for receiving nominations for additional members on 

any of the four committees is January 6, 1999. The dates for the 

negotiation sessions for each committee are announced in the 

supplementary information section of the document.


ADDRESSES: Please send your nominations to Brian Kerrigan, U.S. 

Department of Education, 400 Maryland Avenue, SW, ROB-3, Washington 

D.C. 20202-5257, or fax them to Brian Kerrigan at (202) 205-0786. You 

may also e-mail your nominations to: hea98negotiated__rulemaking@ed.gov


FOR FURTHER INFORMATION CONTACT: Brian Kerrigan, U.S. Department of 

Education, 400 Maryland Avenue, SW, ROB-3, Washington, DC 20202-5257. 

Telephone: (202) 708-5217. If you use a telecommunications device for 

the deaf (TDD) you may call the Federal Information Relay Service 

(FIRS) at 1-800-877-8339 between 8 a.m. and 8 p.m., Eastern time, 

Monday through Friday.


Individuals with disabilities may obtain this document in an 

alternate format (e.g., Braille, large print, audiotape, or computer 

diskette) on request to the contact person listed in the preceding 

paragraph.


SUPPLEMENTARY INFORMATION: The Department anticipates having four 

negotiating committees. The Department lists each committee below and 

the issues each committee is likely to address. This list of issues is 

tentative. Issues may be added as the process continues, and some 

issues listed may not need regulations at all. Citations refer to 

sections of the Higher Education Amendments of 1998 (Pub. L. 105-244, 

enacted Oct. 7, 1998).


Committee I: Lender and Guaranty Agency Issues


Lender Issues


Lender Default Claim Requirements--Section 417(c)(2)(A)

Prohibited Inducements--Section 429(b)

Small Volume Lenders--Section 417(b)(7)

Tax-exempt Funding and Special Allowance Payments--Section 433(d)


Guaranty Agency Issues


Fees and Payments Issues:

    Account Maintenance Fee--Section 454

    Default Aversion Fee--Section 417(h)

    Loan Processing and Issuance Fee--Section 417(e)

    Reduction of Reinsurance Payments--Section 417(c)(7)

    Secretary's Equitable Share--Section 417(c)(5)

Reserves and Funds Issues:

    Recall of Reserves--Section 412(4)

    Federal Fund--Section 413(a)

    Operating Fund--Section 413(b)

    Required Minimum Reserve--Section 417(c)(7)(A)

Other Issues:

    Assignment of Loans--Section 417(c)(6)

    Blanket Guaranty--Section 418

    Lender of Last Resort--Section 417(g)

    Opportunity for Hearing--Section 417(c)(7)(E)

    Prohibited Inducements--Section 417(b)(9)(B)

    Reinsurance Requests--Section 417(c)(2)(B)

    Responding to Electronic Inquiries--Section 412(2)

    State Court Judgments--Section 484

    Unsolicited Applications--Section 417(b)(9)(A)

    Voluntary Flexible Agreements--Section 418

    Wage Garnishment Requirement--Section 490A


Committee II: Loan Issues (FFEL, Direct Loan, and Perkins Loan 

Programs)


Cohort Default Rate Issues:

    Improper Loan Servicing--Section 429

    Mitigating Circumstances--Section 429(a)(3)

    Participation Rate--Section 429(a)(3)

    Special Exemption Institutions--Section 429(a)(3)

    Unsuccessful Appeals--Section 429(a)(1)(A)

Certification, Origination, and Disbursement Issues;

    Certification Requirements--Section 417(a)(1)

    Disbursement by Schools--Section 422

    Disclosure Requirements--Sections 428(a) and (b)

    Loan Limits--Sections 417(b), 423(b), and 423(c)

Repayment Issues:

    Capitalization--Section 423(c)

    Deferments--Section 417(b)

    Forbearance--Sections 417(b) and 423(e)

    Grace Periods--Section 417(b)

    Repayment Plans--Section 417(b)

Discharge and Forgiveness Issues:

    Child Care Provider Forgiveness Program--Section 425

    Disabled Veterans--Section 490F

    Discharge for Failure to Pay Refunds--Section 431

    Teaching Service Forgiveness--Sections 424 and 456

Other Issues:

    Consolidation--Sections 420(a) and (c)

    Definition of Default--Section 429(c)

    Interest Rates--Sections 416 and 420

    Master Promissory Note--Section 427(c)

    Origination Fees--Section 433(d)

    PLUS Eligibility--Section 419

Federal Perkins Loan Program Issues:

    Closed School Discharge--Section 464(d)

    Cohort Default Rates--Sections 462(c) and (d)

    Credit Bureau Reporting--Section 463(b)

    Deferment and Cancellation Benefits--Sections 464(c)(3) and 465

    Expanded Lending Option--Section 463(a)(1)

    Incentive Repayment Program--Section 464(d)

    Loan Limits--Section 464(a)

    Rehabilitation Program--Section 464(d)


Committee III: Refunds, Program, and Student Eligibility Issues


Refunds/Return of Title IV Aid--Section 485


Student Eligibility Issues


Statement of Educational Purpose--Section 483(a)(1)

Freely Associated States--Sections 483(a)(2) and (c)

Home-Schooled Students--Section 483(b)

Telecommunications Courses--Section 483(d)

Verification of Income Data--Section 483(e)


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Suspension of Eligibility for Drug-related Offenses--Section 483(f)

Treatment of Veterans and Americorps--Sections 417(a)(1)(C) and 479


Program Issues


Federal Pell Grant Program:

    Eligibility of Teacher Certification Students--Section 401(e)

    Loss of Eligibility for High Default Rates--Section 401(f)

SSIG/Leveraging Educational Assistance Partnership Program--Sections 

407(a) and (b)

Special Leveraging Educational Assistance Partnership Program--Section 

407(c)

National Early Intervention Partnership and Scholarship Program--

Section 403

Academic Achievement Incentive Scholarship Program--Section 404

Campus-Based Programs--Common Provision

    Reasonable Portion for Non-Traditional Students--Sections 406(b), 

443(d), and 464(b)

Federal Supplemental Educational Opportunity Grant Program

    Carry Forward/Carry Back--Section 406(d)

    Special Summer Carry Back--Section 406(d)

Federal Work-Study Program:

    Definition of Community Services--Section 441(b)

    Employment in Internships, Practical, or Research Assistantships--

Section 443(a)

    Pay for Travel or Training--Section 443(b)

    Increase to 7 Percent Community Service--Section 443(c)

    Reading Tutoring or Family Literacy Project--Section 443(c)

    Ninety Percent Federal Share--Section 443(e)

    Credit to Student's Account--Section 444

    Work Colleges--Section 445


Committee IV: Institutional Eligibility Issues


Accrediting Agency Issues--Section 492

Audit Requirements--Section 489

Branch Campuses--Section 493(h)

Change of Ownership--Section 489

Consumerism Issues:

    Electronic Consumerism--Section 446(a)

    Exit Counseling for Borrowers--Section 486(b)

    Student Right-to-Know--Section 486(a)

    Institutions That Offer Athletic Aid--Section 486(d)

    Campus Crime--Section 486(e)

    Equity in Athletics--Section 486(f)

Definitions of Eligible Institutions Issues: Section 101 (all issues)

    Foreign Veterinary Schools

    Percentage of Incarcerated Students 85/15 Rule

Eligibility and Certification Procedures--Section 493(a)

Evidence of Authority to Operate in a State--Section 491

Financial Guarantees from Owners/Failure to Pay Refunds--Section 493(c)

Financial Responsibility--Section 493(b)

Foreign Schools Audits and Certification--Section 493(e)

Responsibilities of States--Section 491

Quality Assurance Program--Section 490


Each negotiating committee will be balanced and representative of the 

significantly affected interests, such as students, legal assistance 

organizations that represent students, institutions of higher 

education, guaranty agencies, lenders, secondary markets, loan 

servicers, guaranty agency servicers, and collection agencies. To the 

extent possible, the Secretary will select from the nominations 

individuals reflecting the diversity in the industry, representing both 

large and small participants, as well as individuals serving local 

areas and national markets.


Structure of Committees


The ultimate goal of negotiated rulemaking is to reach a consensus 

through discussion and negotiation among interested and affected 

parties, including the Department of Education (Department). With this 

in mind, the Department will conduct these negotiations within a 

structure that is designed to meet this goal fairly and efficiently and 

that takes into account the large number and complex nature of the 

issues to be negotiated. The meetings will be open to the public.


The Department has identified the organizations listed below as 

effective representatives of the interests that are significantly 

affected by the subject matter of the negotiated rulemaking. The 

Department anticipates that these organizations will participate as 

members of one or more of the negotiated rulemaking committees, either 

alone or in combination with others. Organizations not listed that have 

expressed an interest in participating in the process are encouraged to 

work with the listed organizations to ensure that their views are 

known. The committees may also create subgroups on particular topics 

that would involve additional parties.


Accrediting Commission of Career Schools and Colleges of Technology

American Association of Collegiate Registrars and Admissions Officers

American Association of Community Colleges

American Association of Cosmetology Schools

American Association of State Colleges and Universities

American Association of Universities

American Council on Education

Association of American Universities

Career College Association

Coalition of Higher Education Assistance Organizations

Consumer Bankers Association

Education Finance Council

Educational Loan Management Resources

Federation of Associations of Schools of Health Professions

Hispanic Association of Colleges and Universities

Legal Services Counsel (a coalition)

National Association for Equal Opportunity in Higher Education

National Association of College and University Business Officers

National Association of Independent Colleges and Universities

National Association of State Student Grant Aid Programs

National Association of State Universities and Land-Grant Colleges

National Association of Student Financial Aid Administrators

National Association of Student Loan Administrators

National Council of Higher Education Loan Programs

National Direct Student Loans Coalition

Sallie Mae

State Higher Education Executive Officers Association

Student Loan Servicing Alliance

United Negro College Fund

United States Public Interest Research Group

United States Student Association


Schedule for Negotiations


    There are expected to be a total of approximately five meetings of 

each committee, all of which will be held in the metropolitan 

Washington, DC area. The following is the schedule for negotiations for 

each of the four committees.


    This schedule is subject to change.


COMMITTEE I

Session 1: January 19-20

Session 2: February 16-17

Session 3: March 22-24

Session 4: April 19-20

Session 5: May 17-19


COMMITTEE II

Session 1: January 21-22

Session 2: February 18-19


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Session 3: March 24-26

Session 4: April 21-23

Session 5: May 19-21


COMMITTEE III

Session 1: February 1-3

Session 2: February 24-25

Session 3: April 6-8

Session 4: May 3-5

Session 5: May 24-26


COMMITTEE IV

Session 1: February 3-5

Session 2: February 26-27

Session 3: April 8-10

Session 4: May 5-7

Session 5: May 26-28


Invitation for Additional Nominations


    If an individual, organization or group believes that there is a 

significantly affected interest that would not be represented by the 

proposed members and wishes to apply for membership or nominate an 

individual for membership, it may do so. Requests for membership should 

be sent to Brian Kerrigan at the address stated at the beginning of 

this notice, no later than January 6, 1999. A request must include:

    1. A description of the significantly affected interest to be 

represented and the reason that the organizations listed in this notice 

do not adequately represent that interest;

    2. The name of the individual, organization or group that is making 

the nomination;

    3. The name of the nominee and the committee for which the nominee 

is proposed;

    4. The present job of the nominee.

    Please note that participation in the rulemaking process is not 

limited to members of the committee. Following the negotiated 

rulemaking process, the Department will publish proposed rules in the 

Federal Register for public comment. The target date of publication of 

proposed rules developed by the committees is July, 1999.


Electronic Access to This Document


    Anyone may view this document, as well as all other Department of 

Education documents published in the Federal Register, in Text or 

portable document format (pdf) on the World Wide Web at either of the 

following sites:


http://ocfo.ed.gov/fedreg/htm

http://www.ed.gov/news.html


    To use the pdf you must have the Adobe Acrobat Reader Program with 

Search, which is available free at either of the previous sites. If you 

have questions about using the pdf, call the U.S. Government Printing 

Office toll free at 1-888-293-6498.


    Program Authority: 20 U.S.C. 1090a.


(Catalog of Federal Domestic Assistance Number does not apply.)


    Dated: December 21, 1998.

Richard W. Riley,

Secretary of Education.

[FR Doc. 98-34110 Filed 12-22-98; 8:45 am]

BILLING CODE 4000-01-M