**Team V – General and Non-Loan Issues**

**Issue Paper Number and TopicPage #**

#1 Year-Round Pell2

#2 Pell Grants and Children of Soldiers7

#3 TEACH Grant Extenuating Circumstances10

#4 Grants for Federal Work Study16

#5 Conform the FWS rules to the Cash Management rules24

#6 Definition of Community Service30

#7 Flexible Use of Funds33

#8 Work Colleges39

#9 90/10 (Non-Title IV Revenue Requirement)47

#10 Consumer Information67

#11 Fire Safety Standards80

#12 Missing Person Procedures91

#13 Hate Crime Reporting98

#14 Emergency Response and Evacuation Procedures103

#15 Students with Intellectual Disabilities109

#16 Readmission for Servicemembers124

#17 Teach-Outs Requirements and Procedures146

#18 Baccalaureate in “liberal arts” in Proprietary 

Schools154

#19 Peer-to-Peer File Sharing159

#20 Institutional Plans for Improving Academic 

Program168

#21 LEAP Non-Federal Share171

#22 Notification to Students of Source of 

LEAP Funds173

#23 GAP: Program Activities – Partnerships177

#24 GAP: Program Activities – Award182

#25 GAP: Program Activities – Early Notification187

#26 Applicability of LEAP Program Requirements in GAP191

#27 Gap Allotment: Application192

#28 GAP Allotment: Determination197

#29 GAP – Matching202

#30 GAP – Statutory and Regulatory Relief207

#31 GAP – Estimated Financial Assistance208

**Issue Paper #1**

**Origin:**HEOA

**Issue:**Receiving Up to Two Scheduled Federal Pell Grant Awards during a Single Award Year

**Statutory cites:**Section 401(b)(5)(A) of the HEA

**Regulatory cites:**§690.63, §690.64, §690.67 and §690.80

**DCL GEN-08-12 cite:**Pages 103-104

**Summary of issue:** The amendments made by the HEOA require that a student may receive up to two Federal Pell Grant Scheduled Awards during a single award year if the student is enrolled at least half-time for more than one academic year, more than two semesters, or the equivalent time during a single award year.  The student must also be enrolled in a certificate, associate degree or baccalaureate degree program.

**Updated information since 3/2-4 meetings:**

Section 690.63 would be amended to provide instructions  on how an institution  calculates the Pell Grant payment for a payment period that may include the credit or clock hours and weeks of instructional time for both a first and second Scheduled Award. 

Section 690.64 would be amended to address the treatment of a payment period that occurs in two award years.  Institutions  would be required to assign a payment period that occurs in two award years to the award year the student receives the maximum payment for the payment period.

Section 690.67 would be amended to implement the requirements in section 401(b)(5)(A) of the HEA which allow a student to receive up to two Federal Pell Grant Scheduled Awards during a single award year. 

Section 690.80 would be amended to require the recalculation of a second Federal Pell Scheduled Award due to a change in the student's enrollment status.

**Tentative agreement:**

**Regulatory language:**

§690.63  Calculation of a Federal Pell Grant for a payment period.

*   *   *   *   *   

(h)  Payment from two Scheduled Awards.  (1)  In a payment period, a student may receive a payment from the student’s first Scheduled Award in the award year and the student’s second Scheduled Award in the award year if--

(i)  The student is an eligible student who meets the provisions of §690.67; and

(ii) The student’s payment for the payment period is greater than the remaining balance of the first Scheduled Award.

(2)  The student’s payment for the payment period--

(i)  Is calculated based on the total credit or clock hours and weeks of instructional time in the payment period; and 

(ii)  Is the remaining amount of the first Scheduled Award plus an amount from the second Scheduled Award for the balance of the payment for the payment period.

§690.64  Calculation of a Federal Pell Grant for a payment period that occurs in two award years.

~~(a)~~  If a student enrolls in a payment period that is scheduled to occur in two award years— 

(~~1~~a)  The entire payment period must be considered to occur within one award year~~.~~;

(~~2~~b)(1)  An institution shall assign the payment period to the award year in which the student receives the greater payment for the payment period based on the information available at the time of disbursement~~The institution shall determine for each Federal Pell Grant recipient the award year in which the payment period will be placed subject to the restrictions set forth in paragraph (a)(3) of this section.~~;

(2)  If, subsequent to the initial disbursement for the payment period, the institution determines that the student would receive a greater payment for the payment period by reassigning the payment to a different award year, the institution may reassign the payment to the award year providing the greater payment;

(~~3~~c)  The institution shall place a payment period with more than six months scheduled to occur within one award year in that award year~~.~~;

(~~4~~d)  If an institution places the payment period in the first award year, it shall pay a student with funds from the first award year~~.~~; and

(~~5~~e)  If an institution places the payment period in the second award year, it shall pay a student with funds from the second award year.

~~(b)  An institution may not make a payment which will result in the student receiving more than one Scheduled Award his or her Scheduled Federal Pell Grant for an award year.~~

§690.67  Receiving up to two Scheduled Awards during a single award year.

An institution shall award up to a second Scheduled Award to a student in an award year if the student--

(a)  Is enrolled at least as a half-time student in a payment period during which the student would be earning credit or clock hours applicable to a second academic year in the award year; and

(b)  Has successfully completed the credit or clock hours of the first academic year in the award year, or would be completing the credit or clock hours of that academic year in the payment period for which he or she is receiving a payment from a second Scheduled Award in the award year.

§690.80  Recalculation of a Federal Pell Grant award.

*   *   *   *   * 

(b)  Change in enrollment status. 

(1)  *   *   *

(3)  If the student’s projected enrollment status changes at any time during a payment period in which the student receives a payment from a second Scheduled Award in an award year, the institution shall recalculate the student’s payment for the payment period.  The recalculation must take into account any changes in the student’s cost of attendance.

**Statutory Language:**

~~(6)(A) The Secretary may allow, on a case-by-case basis, a student to receive 2 Pell grants during a single award year, if—~~

~~(i) the student is enrolled full-time in an associate or baccalaureate degree program of study that is 2 years or longer at an eligible institution that is computed in credit hours; and~~

~~(ii) the student completes course work toward completion of an associate or baccalaureate degree that exceeds the requirements for a full academic year as defined by the institution.~~

~~(B) The Secretary shall promulgate regulations implementing this paragraph.~~

**(5)(A)**The Secretary shall award a student not more than two Federal Pell Grants during a single award year to permit such student to accelerate the student’s progress toward a degree or certificate if the student is enrolled—

**(i)**on at least a half-time basis for a period of more than one academic year, or more than two semesters or an equivalent period of time, during a single award year; and

**(ii)**in a program of instruction at an institution of higher education for which the institution awards an associate or baccalaureate degree or a certificate.

**(B)**In the case of a student receiving more than one Federal Pell Grant in a single award year under subparagraph (A), the total amount of Federal Pell Grants awarded to such student for the award year may exceed the maximum basic grant level specified in the appropriate appropriations Act for such award year.

**Issue Paper # 2**

**Origin:**HEOA

**Issue:**Maximum Federal Pell Grant Award to Children of Soldiers

**Statutory cites:**Section 401(f)(4) of the HEA

**Regulatory cites:**§690.75

**DCL GEN-08-12 cite:**Pages 104-105

**Summary of issue:**  The HEA as amended by the HEOA provides maximum Federal Pell Grant eligibility (an EFC of 0) for a student (1) whose parent or guardian was a member of the Armed Forces of the United States and died as a result of performing military service in Iraq or Afghanistan after September 11, 2001, and (2) who was under 24 years old or enrolled in an institution of higher education at the time of the parent or guardian’s death.  These students are considered eligible for the maximum Federal Pell Grant award if they meet the requirements of section 401(c) of the HEA, as amended, regarding the period of eligibility for a grant.  The HEOA further directs the Secretary of Veterans Affairs and the Secretary of Defense to provide necessary information to the Secretary of Education.  This provision will not require any new questions on the FAFSA.

**Updated information since 2/2-4 meetings:**

Section 690.75 would be amended to implement the requirement in section 401(f)(4) of the HEA.

**Tentative agreement:**

**Regulatory language:**

§690.75  Determination of eligibility for payment.

*   *   *

(e)  A student is considered to have an expected family contribution of zero if --

(1) The student’s parent or guardian was a member of the Armed Forces of the United States and died as a result of performing military service in Iraq or Afghanistan after September 11, 2001; 

(2) At the time of the parent or guardian’s death the student--

(i)  Was under the age of 24; or

(ii)  Was enrolled at an institution of higher education; and

(3) The student has an expected family contribution for an award year that is not greater than the maximum EFC that would qualify any student for a Federal Pell Grant in that award year.

**Statutory Language:**

**(4)(A)**Notwithstanding paragraph (1) or any other provision of this section, the expected family contribution of each student described in subparagraph (B) shall be deemed to be zero for the period during which each such student is eligible to receive a Federal Pell Grant under subsection (c).

**(B)**Subparagraph (A) shall apply to any student at an institution of higher education—

**(i)**whose parent or guardian was a member of the Armed Forces of the United States who died as a result of performing military service in Iraq or Afghanistan after September 11, 2001; and

**(ii)**who was less than 24 years of age, or was enrolled as a full-time or part-time student at an institution of higher education, as of the time of the parent or guardian’s death.

**(C)**Notwithstanding any other provision of law, the Secretary of Veterans Affairs and the Secretary of Defense, as appropriate, shall provide the Secretary of Education with information necessary to determine which students meet the requirements of subparagraph (B).

**Issue Paper # 3**

**Origin:**Higher Education Opportunity Act of 2008

**Issue:**Extenuating Circumstances for Students Unable to Fulfill Service Obligation under the TEACH Grant Program

**Statutory cites:**420N(d)(2) of the HEA

**Regulatory cites:**§686.41 and §686.42

**DCL GEN-08-12 cite:**Page 106

**Summary of issue:**  The HEOA adds a new provision to the HEA that requires the Secretary to establish categories of extenuating circumstances under which a TEACH Grant recipient who is unable to fulfill all or part of his or her service obligation may be excused from fulfilling that portion of the service obligation.

**Updated information since 3/2-4 meetings:**

Section 686.41 would be amended to limit the suspension for a call or order to active duty status for a TEACH Grant recipient to three years.  After the three-year period, a TEACH Grant recipient could apply for a discharge of his or her service obligation. 

Section 686.42 would be amended to provide that a TEACH Grant recipient could apply for a discharge of a portion or all of his or her service obligation based on the number of years called or ordered to active duty status.

**Tentative agreement:**

**Regulatory language:**

§686.41  Periods of suspension.

(a)(1) A grant recipient who has completed or who has otherwise ceased enrollment in a TEACH Grant-eligible program for which he or she received TEACH Grant funds may request a suspension from the Secretary of the eight-year period for completion of the service obligation based on--

(i) Enrollment in a program of study for which the recipient would be eligible for a TEACH Grant or in a program of study that has been determined by a State to satisfy the requirements for certification or licensure to teach in the State's elementary or secondary schools;

(ii) A condition that is a qualifying reason for leave under the FMLA; or

(iii) A call or order to active duty status for more than 30 days as a member of a reserve component of the Armed Forces named in 10 U.S.C. 10101, or service as a member of the National Guard on full-time National Guard duty, as defined in 10 U.S.C. 101(d)(5), under a call to active service in connection with a war, military operation, or a national emergency.

(2) A grant recipient may receive a suspension described in paragraphs (a)(1)(i), (ii) and (iii) of this section in one-year increments that--

(i) Does not exceed a combined total of three years under both paragraphs (a)(1)(i) and (ii) of this section; or

(ii) Does not exceed a total of three years under~~Ends upon the completion of the military service in~~ paragraph (a)(1)(iii) of this section.

(b) A grant recipient must apply for a suspension in writing on a form approved by the Secretary prior to being subject to any of the conditions under Sec. 686.43(a)(1) through (a)(5) that would cause the TEACH Grant to convert to a Federal Direct Unsubsidized Loan.

(c) A grant recipient must provide the Secretary with documentation supporting the suspension request as well as current contact information including home address and telephone number.

§686.42  Discharge of agreement to serve.

(a) Death. If a grant recipient dies, the Secretary discharges the obligation to complete the agreement to serve based on an original or certified copy of the grant recipient's death certificate, an accurate and complete photocopy of the original or certified copy of the grant recipient's death certificate, or, on a case-by-case basis, reliable documentation acceptable to the Secretary.

(b) Total and permanent disability. (1) A grant recipient's agreement to serve is discharged if the recipient becomes  totally and permanently disabled, as defined in 34 CFR 682.200(b), and the grant recipient applies for and satisfies the eligibility requirements for a total and permanent disability discharge in accordance with 34 CFR 685.213.

(2) The eight-year time period in which the grant recipient must complete the service obligation remains in effect during the conditional discharge period described in 34 CFR 685.213(c)(2) unless the grant recipient is eligible for a suspension based on a condition that is a qualifying reason for leave under the FMLA in accordance with Sec. 686.41(a)(1)(ii)(D).

(3) Interest continues to accrue on each TEACH Grant disbursement unless and until the TEACH Grant recipient's agreement to serve is discharged.

(4) If the grant recipient satisfies the criteria for a total and permanent disability discharge during and at the end of the three-year conditional discharge period, the Secretary discharges the grant recipient's service obligation.

(5) If, at any time during or at the end of the three-year conditional discharge period, the Secretary determines that the grant recipient does not meet the eligibility criteria for a total and permanent disability discharge, the Secretary ends the conditional discharge period and the grant recipient is once again subject to the terms of the agreement to serve.  

(c) Military discharge.  (1) A grant recipient who has completed or who has otherwise ceased enrollment in a TEACH Grant-eligible program for which he or she received TEACH Grant funds and has exceeded the period of time allowed under §686.41(a)(2)(ii), may request in writing to the Secretary, a proportional discharge of his or her service obligation due to an extended call or order to active duty status.

(2) A grant recipient described in paragraph (c)(1) may receive a--

(i) One-year discharge of his or her service obligation if a call or order to active duty status is for more than 3 years;

(ii) Two-year discharge of his or her service obligation if a call or order to active duty status is for more than 4 years; 

(iii) Three-year discharge of his or her service obligation if a call or order to active duty status is for more than 5 years; or

(iv) Full discharge of his or her service obligation if a call or order to active duty status is for 6 or more years.

(3) Documentation needed for a Military discharge. A grant recipient must provide the Secretary with--

(i) A written statement from the grant recipient's commanding or personnel officer certifying--

(A) That the grant recipient is on active duty in the Armed Forces of the United States;

(B) The date on which the grant recipient's service began; and

(C) The date on which the grant recipient's service is expected to end; or

(ii)(A) A copy of the grant recipient's official military orders; and

(B) A copy of the grant recipient's military identification.

(4) For the purpose of this section, the Armed Forces means the Army, Navy, Air Force, Marine Corps, and the Coast Guard.

(5) A grant recipient enlisted in a reserve component of the Armed Forces may qualify for a military discharge only for service on a full-time basis that is expected to last for a period of at least one year in length, as evidenced by official military orders, unless an order for national mobilization of reservists is issued.

(6) A grant recipient enlisted in the National Guard qualifies for a military discharge only while the grant recipient is on active duty status as a member of the U.S. Army or Air Force Reserves, and meets the requirements of paragraph (5) of this section.

(7) The Secretary will notify the grant recipient of the outcome of his or her request for a military discharge.  For the portion on the service obligation that remains, the grant recipient must continue to fulfill his or her service obligation in accordance with §686.12.

**Statutory Language:**

**(2)**EXTENUATING CIRCUMSTANCES.—The Secretary shall establish, by regulation, categories of extenuating circumstances under which a recipient of a grant under this subpart who is unable to fulfill all or part of the recipient’s service obligation may be excused from fulfilling that portion of the service obligation.

**Issue Paper #4**

**Origin:**HEOA

**Issue:**Grants for FWS Program 

**Statutory cites:**Section 443 of the HEA

**Regulatory cites:**§§ 675.18, 675.26

**Summary of issue:**The HEOA permits institutions to use FWS funds to compensate students employed in projects that teach civics in schools, raise awareness of government functions or resources, or increase civic participation.

In addition, the HEOA requires that, to the extent practicable, an institution must

· Give priority to the employment of students participating in projects that educate or train the public about evacuation, emergency response, and injury prevention strategies relating to natural disasters, acts of terrorism, and other emergency situations; and

· Ensure that any student compensated with these funds receives appropriate training to carry out the educational services required. 

Students performing these activities maybe paid for time spent in training and travel.  Finally, the HEOA specifies that the Federal share of the compensation of FWS students may exceed 75%.  

**Updated information since 3/2-4 meetings:**Section 675.18 would be amended to implement section 443 of the HEOA that promotes the use of FWS funds to employ students in community service projects, doing civic education and participation activities. When a school has students performing these projects, to the extent practicable it must give priority to the employment of students participating in projects that educate or train the public about evacuation, emergency response, and injury prevention strategies relating to natural disasters, acts of terrorism, and other emergency situations; and ensure that the students receive the appropriate training to carry out the educational services required. 

Section 675.26 would be amended to implement the requirements in section 443 to allow the Federal share of the compensation of FWS students to exceed 75%.

**Tentative agreement:**

**Regulatory language:**

##### §675.18  Use of funds.

*****

(f) *  *  *

(g) Community service*.*(1) For the 2000–2001 award year and subsequent award years, an institution must use at least seven percent of the sum of its initial and supplemental FWS allocations for an award year to compensate students employed in community service activities. In meeting this community service requirement, an institution must include at least one—

(i) Reading tutoring project that employs one or more FWS students as reading tutors for children who are preschool age or are in elementary school; or

(ii) Family literacy project that employs one or more FWS students in family lit0eracy activities.

(2) The Secretary may waive the requirements in paragraph (g)(1) of this section if the Secretary determines that an institution has demonstrated that enforcing the requirements in paragraph (g)(1) of this section would cause a hardship for students at the institution.

(3) To the extent practicable, in providing reading tutors for children under paragraph (g)(1)(i), an institution must—

(i) Give priority to the employment of students to tutor in reading in schools that are participating in a reading reform project that—

(A) Is designed to train teachers how to teach reading on the basis of scientifically-based research on reading; and

(B) Is funded under the Elementary and Secondary Education Act of 1965; and

(ii) Ensure that any student who is employed in a school participating in a reading reform project described in paragraph (g)(3)(i) of this section receives training from the employing school in the instructional practices used by the school.

(4)(i) In meeting the seven percent community service requirement in paragraph (g)(1) of this section, an institution may employ students to perform civic education and participation activities in projects that- 

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(A) Teach civics in schools;
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(B) Raise awareness of government functions or resources; or
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(C) Increase civic participation.
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(ii) To the extent practicable, in providing civic education and participation activities under paragraph (g)(4)(i), an institution must-
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(A) Give priority to the employment of students in projects that educate or train the public about evacuation, emergency response, and injury prevention strategies relating to natural disasters, acts of terrorism, and other emergency situations; and
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(B) Ensure that the students receive appropriate training to carry out the educational services required.
```

(h) Payment for time spent in training and travel*.*(1) For any award year, an institution may pay students for a reasonable amount of time spent for training that is directly related to FWS employment.

(2) Beginning with the 1999–2000 award year, an institution may pay students for a reasonable amount of time spent for travel that is directly related to employment in community service activities (including tutoring in reading and family literacy activities).

*   *   *   *   * 

##### §675.26  FWS Federal share limitations.

##### *****

(d) For each award year, the Secretary authorizes a Federal share of 100 percent of the compensation earned by a student under this part if—

(1) The work performed by the student is for the institution itself, for a Federal, State, or local public agency, or for a private nonprofit organization; and

(2)(i) The institution in which the student is enrolled—

(A) Is designated as an eligible institution under—

(1) The Developing Hispanic-Serving Institutions Program (34 CFR part 606);

(2) The Strengthening Institutions Program, American Indian Tribally Controlled Colleges and Universities Program, or Alaska Native and Native Hawaiian-Serving Institutions Program (34 CFR part 607);

(3) The Strengthening Historically Black Colleges and Universities Program (34 CFR part 608); or

(4) The Strengthening Historically Black Graduate Institutions Program (34 CFR part 609); and

(B) Requests that increased Federal share as part of its regular FWS funding application for that year;

(ii) The student is employed as a reading tutor for preschool age children or children who are in elementary school;

(iii) The student is performing family literacy activities in a family literacy project that provides services to families with preschool age children or children who are in elementary school; or

(iv) The student is employed as a mathematics tutor for children who are in elementary school through the ninth grade.

##### (v) The student is employed in community service activities, performing civic education and participation activities in a project as defined in §675.18(g)(4). 

*  *  *  *  *

**Statutory language:**

**(a)**AGREEMENTS REQUIRED.—The Secretary is authorized to enter into agreements with institutions of higher education under which the Secretary will make grants to such institutions to assist in the operation of work-study programs as provided in this part.

**(b)**CONTENTS OF AGREEMENTS.—An agreement entered into pursuant to this section shall—

**(1)**provide for the operation by the institution of a program for the part-time employment, including internships, practical, or research assistantships as determined by the Secretary, of its students in work for the institution itself, work in community service or work in the public interest for a Federal, State, or local public agency or private nonprofit organization under an arrangement between the institution and such agency or organization, and such work—

**(A)**will not result in the displacement of employed workers or impair existing contracts for services;

**(B)**will be governed by such conditions of employment as will be appropriate and reasonable in light of such factors as type of work performed, geographical region, and proficiency of the employee;

**(C)**does not involve the construction, operation, or maintenance of so much of any facility as is used or is to be used for sectarian instruction or as a place for religious worship; and

**(D)**will not pay any wage to students employed under this subpart that is less than the current Federal minimum wage as mandated by section 6(a) of the Fair Labor Standards Act of 1938;

**(2)**provide that funds granted an institution of higher education, pursuant to section 443, may be used only to make payments to students participating in work-study programs, except that—

**(A)**for fiscal year 2000 and succeeding fiscal years, an institution shall use at least 7 percent of the total amount of funds granted to such institution under this section for such fiscal year to compensate students employed in community service, and shall ensure that not less than 1 tutoring or family literacy project (as described in subsection (d)) is included in meeting the requirement of this subparagraph, except that the Secretary may waive this subparagraph if the Secretary determines that enforcing this subparagraph would cause hardship for students at the institution; and

**(B)**an institution may use a portion of the sums granted to it to meet administrative expenses in accordance with section 489 of this Act, may use a portion of the sums granted to it to meet the cost of a job location and development program in accordance with section 446 of this part, and may transfer funds in accordance with the provisions of section 488 of this Act;  

*****

(B)   *   *   *

**(3)**FEDERAL SHARE.—The Federal share of the compensation of work-study students compensated under this subsection may exceed 75 percent.

**(e)**CIVIC EDUCATION AND PARTICIPATION ACTIVITIES.—

**(1)**USE OF FUNDS.—Funds granted to an institution under this section may be used in accordance with such subsection to compensate (including compensation for time spent in training and travel directly related to civic education and participation activities) students employed in projects that—

**(A)**teach civics in schools;

**(B)**raise awareness of government functions or resources; or

**(C)**increase civic participation.

**(2)**PRIORITY FOR SCHOOLS.—To the extent practicable, an institution shall—

**(A)**give priority to the employment of students participating in projects that educate or train the public about evacuation, emergency response, and injury prevention strategies relating to natural disasters, acts of terrorism, and other emergency situations; and (B) ensure that any student compensated with the funds described in paragraph (1) receives appropriate training to carry out the educational services required.

**(3)**FEDERAL SHARE.—The Federal share of the compensation of work-study students compensated under this subsection may exceed 75 percent.

**Issue Paper #5**

**Origin:**HEOA

**Issue:**Conform the FWS rules to the Cash Management Rules 

**Statutory cites:**None

**Regulatory cites:**§675.16

**Summary of issue:**Technical changes needed to conform the FWS rules with the cash management rules.

**Updated information since 3/2-4 meetings:**These changes would:

1.  Provide for the $200 prior year charge for FWS just as it is for the other programs.

2.  Provide that the FWS authorization may be on the same authorization form used for the other programs, instead of a separate form for FWS.

3.  Provide for a single authorization for any title IV disbursements via EFT, including FWS.  .

4.  Provide that the school may require a bank account for FWS payments just as it does for other programs.

5.  Apply the same concept of a stored-value card and other devises to FWS as exists for the other programs.

6.  Provide for similar wording for authorizations and the cancellation of the authorizations for FWS as for the other programs.

Please note that because the FWS payments represent compensation, the institution needs an authorization to credit FWS funds to a student's account to pay for any charges including tuition and fees as well as room and board.  This is different from the other programs.  Under FWS, an institution cannot take compensation without an authorization or a legal garnishment of wages.

**Tentative Agreement:**

**Regulatory language:**

§675.16  Payments to students.

(a) *General.* (1)  An institution must follow the disbursement procedures in this section for paying a student his or her wages under the FWS Program instead of the disbursement procedures in 34 CFR 668.164(a), (b), and (d) through (g), and 34 CFR 668.165.  The institution must follow 34 CFR 668.164(c) on making direct FWS payments to students and 34 CFR 668.164(h) on handling the return of FWS funds that are not received or negotiated by a student. **

(2)  An institution must pay a student FWS compensation at least once a month.

(3)  Before an institution makes an initial disbursement of FWS compensation to a student for an award period, the institution must notify the student of the amount of funds the student is authorized to earn, and how and when the FWS compensation will be paid.

(4)  Regardless of who employs the student, the institution is responsible for ensuring that the student is paid for work performed.

(5)  A student’s FWS compensation is earned when the student performs the work.

(6)  An institution may pay a student after the student’s last day of attendance for FWS compensation earned while he or she was in attendance at the institution.

(7)  A correspondence student must submit his or her first completed lesson before receiving a payment.

(8)  The institution may not obtain a student’s power of attorney to authorize any disbursement of funds without prior approval from the Secretary.

(9)  An institution makes a disbursement of FWS program funds on the date that the institution credits a student’s account at the institution or pays a student directly with—

(i)  Funds received from the Secretary; or

(ii)  Institutional funds used in advance of receiving FWS program funds. 

(b)  Crediting a student’s account at the institution.  (1)  If the institution obtains the student’s authorization described in paragraph (d) of this section, the institution may use the FWS funds to credit a student’s account at the institution to satisfy—

(i)  Current year charges for—

(A)  Tuition and fees;

(B)  Board, if the student contracts with the institution for board;

(C)  Room, if the student contracts with the institution for room; and

(D)  Other educationally related charges incurred by the student at the institution; and

(ii)  Prior award year charges with the restriction provided in paragraph (b)(2) of this section for a total of not more than $200 for—

(A)  Tuition and fees, room, or board; and 

(B)  Other institutionally related charges incurred by the student at the institution.

(2)  If the institution is using FWS funds in combination with other title IV, HEA program funds to credit a student’s account at the institution to satisfy prior award year charges, a single $200 total prior award year charge limit applies to the use of all the title IV, HEA program funds for that purpose.

(c)  *Credit balances.*  Whenever an institution disburses FWS funds by crediting a student’s account and the result is a credit balance, the institution must pay the credit balance directly to the student as soon as possible, but no later than 14 days after the credit balance occurred on the account. 

(d)  *Student authorizations.*(1)  Except for the noncash contributions allowed under paragraphs (e)(2) and (e)(3) of this section, if an institution obtains written authorization from a student, the institution may—

(i)  Use the student’s FWS compensation to pay for charges described in paragraph (b) of this section that are included in that authorization; and

(ii)  Except if prohibited by the Secretary under the reimbursement or cash monitoring payment method, hold on behalf of the student any FWS compensation that would otherwise be paid directly to the student under paragraph (c).  

(2)  In obtaining the student’s authorization to perform an activity described in paragraph (d)(1) of this section, an institution—

(i)  May not require or coerce the student to provide that authorization;

(ii)  Must allow the student to cancel or modify that authorization at any time; and

(iii)  Must clearly explain how it will carry out that activity.

(3)  A student may authorize an institution to carry out the activities described in paragraph (d)(1) of this section for the period during which the student is enrolled at the institution.

(4)(i)  If a student modifies an authorization, the modification takes effect on the date the institution receives the modification notice.

(ii)  If a student cancels an authorization to use his or her FWS compensation to pay for authorized charges under paragraph (b) of this section, the institution may use those funds to pay only those authorized charges incurred by the student before the institution received the notice.

(iii)  If a student cancels an authorization to hold his or her FWS compensation under paragraph (d)(1)(ii) of this section, the institution must pay those funds directly to the student as soon as possible, but no later than 14 days after the institution receives that notice.

(5)  If an institution holds excess FWS compensation under paragraph (d)(1)(ii) of this section, the institution must—

(i)  Identify the amount of funds the institution holds for each student in a subsidiary ledger account designed for that purpose;

(ii)  Maintain, at all times, cash in its bank account in an amount at least equal to the amount of FWS compensation the institution holds for the student; and

(iii)  Notwithstanding any authorization obtained by the institution under this paragraph, pay any remaining balances by the end of the institution’s final FWS payroll period for an award year.

(e)(1)  *Timing of institutional share and noncash contributions.*  Except for the noncash contributions allowed under paragraph (e)(2) or (e)(3) of this section, an institution must pay the student its share of his or her FWS compensation at the same time it pays the Federal share.

(2)  If an institution pays a student its FWS share for an award period in the form of tuition, fees, services, or equipment, it must pay that share before the student’s final payroll period.

(3)  If an institution pays its FWS share in the form of prepaid tuition, fees, services, or equipment for a forthcoming academic period, it must give the student a statement before the close of his or her final payroll period listing the amount of tuition, fees, services, or equipment earned.

**34 CFR 668.161  Scope and purpose (Cash Management rules)**

***

(a)(4)  FWS Program.  An institution must follow the disbursement procedures in 34 CFR 675.16 for paying a student his or her wages under the FWS Program instead of the disbursement procedures in §§668.164(a), (b), and (d) through (g), and 668.165.

*********

**Issue Paper #6**

**Origin:**HEOA

**Issue:**Definition of Community Service 

**Statutory cites:**Section 441(c)(1) of the HEA

**Regulatory cites:**§675.2

**Summary of issue:**The HEOA expands the definition of community service to include the field of emergency preparedness and response.  

**Updated information since 3/2-4 meetings:**  Section 675.2 would be amended to include emergency preparedness and response.

**Tentative agreement:**

**Regulatory language:**

**675.2 Definitions**

*********

(b) The Secretary defines other terms used in this part as follows:

*Community services:*Services which are identified by an institution of higher education, through formal or informal consultation with local nonprofit, governmental, and community-based organizations, as designed to improve the quality of life for community residents, particularly low-income individuals, or to solve particular problems related to their needs. These services include—

(1) Such fields as health care, child care (including child care services provided on campus that are open and accessible to the community), literacy training, education (including tutorial services), welfare, social services, transportation, housing and neighborhood improvement, public safety, emergency preparedness and response, crime prevention and control, recreation, rural development, and community improvement; 

(2) Work in service opportunities or youth corps as defined in section 101 of the National and Community Service Act of 1990, and service in the agencies, institutions and activities designated in section 124(a) of that Act;

(3) Support services to students with disabilities, including students with disabilities who are enrolled at the institution; and

(4) Activities in which a student serves as a mentor for such purposes as—

(i) Tutoring;

(ii) Supporting educational and recreational activities; and

(iii) Counseling, including career counseling.

*****

**Statutory language:**

**(c)**COMMUNITY SERVICES.—For purposes of this part, the term ‘‘community services’’ means services which are identified by an institution of higher education, through formal or informal consultation with local nonprofit, governmental, and community-based organizations, as designed to improve the quality of life for community residents, particularly low-income individuals, or to solve particular problems related to their needs, including—

**(1)**such fields as health care, child care (including child care services provided on campus that are open and accessible to the community), literacy training, education (including tutorial services), welfare, social services, transportation, housing and neighborhood improvement, public safety, emergency preparedness and response, crime prevention and control, recreation, rural development, and community improvement;

**(2)**work in a project, as defined in section 101(20) of the National and Community Service Act of 1990 (42 U.S.C. 12511(20));

**(3)**support services to students with disabilities, including students with disabilities who are enrolled at the institution; and

**(4)**activities in which a student serves as a mentor for such purposes as—

**(A)**tutoring;

**(B)**supporting educational and recreational activities; and

**(C)**counseling, including career counseling.

**Issue Paper #7**

**Origin:**HEOA

**Issue:**Flexible Use of Funds 

**Statutory cites:**Section 445(d) of the HEA

**Regulatory cites:**§675.18

**Summary of issue:**The HEOA adds a provision under which an eligible institution located in any area affected by a major disaster, as determined by the Secretary, may make FWS payments to disaster-affected students. The FWS payments may be made for the period of time (not to exceed one academic year) in which the disaster affected students were prevented from fulfilling their work-study obligations for all or part of such academic year due to the major disaster.

Payments may be made in an amount equal to or less than the amount of FWS wages the students would have been paid had the students been able to complete the work obligation necessary to receive work-study funds.  Payments may not be made to any student who was not eligible for work-study or was not completing the work obligation necessary to receive FWS funds prior to the major disaster.  Any payments made must meet the FWS matching requirements, unless the Secretary waives the matching requirements.

The term “disaster-affected student” means a student enrolled at an eligible institution who:

• received an FWS work-study award for the academic year during which a major disaster occurred;

• earned FWS wages from such eligible institution for such academic year prior to the disaster;

• was prevented from fulfilling the student’s work-study obligation for all or part of such academic year due to such major disaster; and

• was unable to be reassigned to another work-study job.

The term “major disaster” has the meaning as the term in section 102(2) of the Robert T. Stafford Disaster Relief and Emergency Assistance Act (42 U.S.C. 5122(2)): any natural catastrophe (including any hurricane, tornado, storm, high water, wind-driven water, tidal wave, tsunami, earthquake, volcanic eruption, landslide, mudslide, snowstorm, or drought), or, regardless of cause, any fire, flood, or explosion, in any part of the United States, which in the determination of the President causes damage of sufficient severity and magnitude to warrant major disaster assistance under this chapter to supplement the efforts and available resources of States, local governments, and disaster relief organizations in alleviating the damage, loss, hardship, or suffering caused thereby.  

**Updated information since 3/2-4 meetings:** Section 675.18 would be amended to add the provisions under which  an institution located in any affected area, as determined by the Secretary, may make FWS payments to disaster-affected students.

**Tentative agreement:**

**Regulatory language:**

§675.18  Use of funds.

*   *   *   *   *

(g) Community service*.*(1) For the 2000–2001 award year and subsequent award years, an institution must use at least seven percent of the sum of its initial and supplemental FWS allocations for an award year to compensate students employed in community service activities. In meeting this community service requirement, an institution must include at least one—

(i) Reading tutoring project that employs one or more FWS students as reading tutors for children who are preschool age or are in elementary school; or

(ii) Family literacy project that employs one or more FWS students in family literacy activities.

(2) The Secretary may waive the requirements in paragraph (g)(1) of this section if the Secretary determines that an institution has demonstrated that enforcing the requirements in paragraph (g)(1) of this section would cause a hardship for students at the institution.

(3) To the extent practicable, in providing reading tutors for children under paragraph (g)(1)(i), an institution must—

(i) Give priority to the employment of students to tutor in reading in schools that are participating in a reading reform project that—

(A) Is designed to train teachers how to teach reading on the basis of scientifically-based research on reading; and

(B) Is funded under the Elementary and Secondary Education Act of 1965; and

(ii) Ensure that any student who is employed in a school participating in a reading reform project described in paragraph (g)(3)(i) of this section receives training from the employing school in the instructional practices used by the school.

(h) Payment for time spent in training and travel*.*(1) For any award year, an institution may pay students for a reasonable amount of time spent for training that is directly related to FWS employment.

(2) Beginning with the 1999–2000 award year, an institution may pay students for a reasonable amount of time spent for travel that is directly related to employment in community service activities (including tutoring in reading and family literacy activities).

(i)****Flexibility in the event of a major disaster.  

(1)****General.  An institution located in any area affected by a major disaster may make FWS payments to disaster-affected students for the period of time (not to exceed the award period) in which the disaster-affected students were prevented from fulfilling their FWS obligations.  The FWS payments-- 

(i)  May be made to disaster-affected students for an amount equal to or less than the amount of FWS wages the students would have been paid had the students been able to complete the work obligation necessary to receive the funds.

(ii)  May not be made to any student who was not eligible for FWS or was not completing the work obligation necessary to receive the funds prior to the occurrence of the major disaster.

(iii)****Must meet the matching requirements of §675.26, unless those requirements are waived by the Secretary.

(2)  Definitions.  The following definitions apply to this section:

(i)  Disaster-affected student means a student enrolled at an institution who—

(A)  Received an FWS award for the award period during which a major disaster occurred;

(B)  Earned FWS wages from an institution for that award period;

(C)  Was prevented from fulfilling his or her FWS obligation for all or part of the FWS award period because of the major disaster; and

(D)  Was unable to be reassigned to another FWS job.

(ii)  Major disaster is defined in section 102(2) of the Robert T. Stafford Disaster Relief and Emergency Assistance Act (42 U.S.C. 5122(2)).

**Statutory language:**

**(c)**FLEXIBLE USE OF FUNDS.—An eligible institution may, upon the request of a student, make payments to the student under this part by crediting the student’s account at the institution or by making a direct deposit to the student’s account at a depository institution. An eligible institution may only credit the student’s account at the institution for (1) tuition and fees, (2) in the case of institutionally owned housing, room and board, and (3) other institutionally provided goods and services.

**(d)**FLEXIBILITY IN THE EVENT OF A MAJOR DISASTER.—

**(1)**IN GENERAL.—In the event of a major disaster, an eligible institution located in any area affected by such major disaster, as determined by the Secretary, may make payments under this part to disaster-affected students, for the period of time (not to exceed one academic year) in which the disaster-affected students were prevented from fulfilling the students’ work-study obligations as described in paragraph (2)(A)(iii), as follows: 

**(A)**Payments may be made under this part to disaster- affected students in an amount equal to or less than the amount of wages such students would have been paid under this part had the students been able to complete the work obligation necessary to receive work study funds.

**(B)**Payments shall not be made to any student who was not eligible for work study or was not completing the work obligation necessary to receive work study funds under this part prior to the occurrence of the major disaster.

**(C)**Any payments made to disaster-affected students under this subsection shall meet the matching requirements of section 443, unless such matching requirements are waived by the Secretary.

**(2)**DEFINITIONS.—In this subsection:

**(A)**The term ‘disaster-affected student’ means a student enrolled at an eligible institution who—

**(i)**received a work-study award under this section for the academic year during which a major disaster occurred; 

**(ii)**earned Federal work-study wages from such eligible institution for such academic year;

**(iii)**was prevented from fulfilling the student’s work-study obligation for all or part of such academic year due to such major disaster; and

**(iv)**was unable to be reassigned to another work-study job.

**(B)**The term ‘major disaster’ has the meaning given such term in section 102(2) of the Robert T. Stafford Disaster Relief and Emergency Assistance Act (42 U.S.C. 5122(2)).

**Issue Paper #8**

**Origin:**HEOA

**Issue:**Work Colleges 

**Statutory cites:**Section 448 of the HEA

**Regulatory cites:§**675.41

**Summary of issue:**The HEOA replaces the term “work-learning’’ each place it appears with ‘‘work-learning-service.’’

In addition, the definitions in section 448(e) of the HEA are revised as follows:

The term “work college” means an eligible institution that:

· has been a public or private nonprofit, four-year, degree-granting institution with a commitment to community service;

· has operated a comprehensive work-learning-service program for at least two years;

· requires students, including at least one-half of all students who are enrolled on a full-time basis, to participate in a comprehensive work-learning-service program for at least five hours each week, or at least 80 hours during each period of enrollment, except summer school, unless the student is engaged in an institutionally organized or approved study abroad or externship program; and

· provides students participating in the comprehensive work-learning-service program with the opportunity to contribute to their education and to the welfare of the community as a whole.

The term “comprehensive student work-learning-service program” means a student work-learning-service program that 

· is an integral and stated part of the institution’s educational philosophy and program;

· requires participation of all resident students for enrollment and graduation;

· includes learning objectives, evaluation, and a record of work performance as part of the student’s college record;

· provides programmatic leadership by college personnel at levels comparable to traditional academic programs;

· recognizes the educational role of work-learning-service supervisors; and

· includes consequences for nonperformance or failure in the work-learning-service program similar to the consequences for failure in the regular academic program.

**Updated information since 3/2-4 meetings:** Section 675.41 would be amended to implement the requirement in section 448(e) of the HEOA to revise two definitions to clarify how institutions qualify as work colleges.  The word “service” is added after work-learning in subpart C as required. 

**Tentative agreement:**

**Regulatory language:**

§**675.41  Special definitions.**

The following definitions apply to this subpart:

(a) *Work-college:*The term “work-college” means an eligible institution that-

(1) Is a public or private nonprofit, four-year, degree- granting institution with a commitment to community service;

(2) Has operated a comprehensive work-learning-service program for at least two years;

(3) Requires ~~All resident~~ students, including at least one-half of all students who are enrolled on a full-time basis, ~~reside on campus~~ to participate in a comprehensive work-learning-service program for at least five hours each week, or at least 80 hours during each period of enrollment, except summer school, unless the student is engaged in an institutionally organized or approved study abroad or externship program; and

(4) Provides students participating in the comprehensive work-learning service program with the opportunity to contribute to their education and to the welfare of the community as a whole.

(b) Comprehensive student work-learning-service program*:*A student work-learning-service program that—

(1) Is an integral and stated part of the institution's educational philosophy and program;

(2) Requires participation of all resident students for enrollment, ~~participation,~~ and graduation; 

(3) Includes learning objectives, evaluation, and a record of work performance as part of the student's college record;

(4) Provides programmatic leadership by college personnel at levels comparable to traditional academic programs;

(5) Recognizes the educational role of work-learning-service supervisors; and

(6) Includes consequences for nonperformance or failure in the work-learning-service program similar to the consequences for failure in the regular academic program.

**§675.43 Purpose**

The purpose of the Work-Colleges program is to recognize, encourage, and promote the use of comprehensive work-learning-service programs as a valuable educational approach when it is an integral part of the institution's educational program and a part of a financial plan that decreases reliance on grants and loans and to encourage students to participate in community service activities.

**§675.44 Program Description**

(a) An institution that satisfies the definition of “work-college” in §675.41(a) and wishes to participate in the Work-Colleges program must apply to the Secretary at the time and in the manner prescribed by the Secretary.

(b) An institution may expend funds separately, or in combination with other eligible institutions, to provide work-learning-service opportunities for currently enrolled students.

(c) For any given award year, Federal funds allocated and reallocated for that award year under sections 442 and 462 of the HEA may be transferred for the purpose of carrying out the Work-Colleges program to provide flexibility in strengthening the self-help-through-work element in financial aid packaging.

**§675.45 Allowable Cost, Federal Share, and Institutional Share**

**(a)*****

**(1)**Support the educational costs of qualified students through self-help payments or credits provided under the work-learning-service program within the limits of part F of title IV of the HEA.

(2) Promote the work-learning-service experience as a tool of postsecondary education, financial self-help, and community service-learning opportunities.

(3) Carry out activities in sections 443 or 446 of the HEA.

(4) Administer, develop, and assess comprehensive work-learning-service programs including—

(i) Community-based work-learning-service alternatives that expand opportunities for community service and career-related work; and

*****

**Statutory language:**

**(a)**PURPOSE.—The purpose of this section is to recognize, encourage, and promote the use of comprehensive work-learning-service programs as a valuable educational approach when it is an integral part of the institution’s educational program and a part of a financial plan which decreases reliance on grants and loans.

**(b)**SOURCE AND USE FUNDS.—

**(1)**SOURCE OF FUNDS.—In addition to the sums appropriated under subsection (f), funds allocated to the institution under part C and part E of this title may be transferred for use under this section to provide flexibility in strengthening the self-help-through-work element in financial aid packaging.

**(2)**ACTIVITIES AUTHORIZED.—From the sums appropriated pursuant to subsection (f), and from the funds available under paragraph (1), eligible institutions may, following approval of an application under subsection (c) by the Secretary—

**(A)**support the educational costs of qualified students through self-help payments or credits provided under the work-learning-service program of the institution within the limits of part F of this title;

**(B)**promote the work-learning-service experience as a tool of postsecondary education, financial self-help and community service-learning opportunities;

**(C)**carry out activities described in section 443 or 446;

**(D)**be used for the administration, development and assessment of comprehensive work-learning- service programs, including—

**(i)**community-based work-learning-service alternatives that expand opportunities for community service and career-related work; and 

**(ii)**alternatives that develop sound citizenship, encourage student persistence, and make optimum use of assistance under this part in education and student development;

**(E)**coordinate and carry out joint projects and activities to promote work service learning; and

**(F)**carry out a comprehensive, longitudinal study of student academic progress and academic and career outcomes, relative to student self-sufficiency in financing their higher education, repayment of student loans, continued community service, kind and quality of service performed, and career choice and community service selected after graduation.

**(c)**APPLICATION.—Each eligible institution may submit an application for funds authorized by subsection (f) to use funds under subsection (b)(1) at such time and in such manner as the Secretary, by regulation, may reasonably require.

**(d)**MATCH REQUIRED.—Funds made available to work-colleges pursuant to this section shall be matched on a dollar-for-dollar basis from non-Federal sources.

**(e)**DEFINITIONS.—For the purpose of this section—

**(1)**the term ‘work college’ means an eligible institution that—

**(A)**has been a public or private nonprofit, four-year, degree-granting institution with a commitment to community service;

**(B)**has operated a comprehensive work-learning-service program for at least two years;

**(C)**requires students, including at least one-half of all students who are enrolled on a full-time basis, to participate in a comprehensive work-learning-service program for at least five hours each week, or at least 80 hours during each period of enrollment, except summer school, unless the student is engaged in an institutionally organized or approved study abroad or externship program; and

**(D)**provides students participating in the comprehensive work-learning-service program with the opportunity to contribute to their education and to the welfare of the community as a whole; and

**(2)**the term ‘comprehensive student work-learning-service program’ means a student work-learning-service program that—

**(A)**is an integral and stated part of the institution’s educational philosophy and program;

**(B)**requires participation of all resident students for enrollment and graduation;

**(C)**includes learning objectives, evaluation, and a record of work performance as part of the student’s college record;

**(D)**provides programmatic leadership by college personnel at levels comparable to traditional academic programs;

**(E)**recognizes the educational role of work-learning-service supervisors; and

**(F)**includes consequences for nonperformance or failure in the work-learning-service program similar to the consequences for failure in the regular academic program.

**(f)**AUTHORIZATION OF APPROPRIATIONS.—There are authorized to be appropriated to carry out this section such sums as may be necessary for fiscal year 2009 and each of the five succeeding fiscal years.

**Issue Paper #9**

**Origin:**HEOA

**Issue:**90/10 (non-Title IV revenue requirement) 

**Statutory cites:**Section 487(d) of the HEA

**Regulatory cites:**§§600.5(a)(8), (d), (f), and (g); §668.23(d)(4)

**DCL GEN-08-12 cite:**Pages 68-69

**Summary of issue:**The HEOA moves the 90/10 Rule to the PPA from Title I of the HEA (the 90/10 Rule applies only to proprietary institutions and requires those institutions to derive at least 10 percent of their revenue from non-Title IV sources).  As a result, an institution that now violates the 90/10 Rule for one year would no longer lose its eligibility to participate in the Title IV programs.  Instead, the institution’s participation becomes provisional for two fiscal years.  However, if the institution does not satisfy the 90/10 Rule for two consecutive fiscal years, it loses its eligibility to participate in the Title IV programs for at least two fiscal years.

If an institution fails to satisfy the 90/10 Rule, the HEOA requires the Department to publicly disclose on the College Navigator Website the identity of that institution and the extent to which the institution failed to satisfy the rule.  In addition, no later than July 1 of each year, the Secretary must submit to Congress a report that contains, for each proprietary institution, the amount and percentage of the institution’s revenues from Title IV sources and non-Title IV sources, as provided by the institution in its audited financial statements.

In calculating the revenue percentage, the HEOA requires an institution to use the cash basis of accounting, except for loans made to students by the institution, and provides that any Title IV program funds that are disbursed or delivered to or on behalf of a student are presumed to pay the student’s tuition, fees, or other institutional charges, unless the tuition, fees, or other charges are satisfied by:

● grant funds from non-Federal public agencies or private sources independent of the institution;

● funds provided under a contractual arrangement with a Federal, State, or local government agency for the purpose of providing job training to low-income individuals in need of that training;

● funds used by a student from savings plans for educational expenses established by or on behalf of the student that qualify for special tax treatment under the Internal Revenue Code; and

● institutional scholarships that count toward the 10 percent revenue requirement.

The HEOA specifies other sources of revenue that count toward the 10 percent requirement after applying the presumption that Title IV funds are used to pay the student’s tuition, fees, and other institutional charges.  Among the sources, an institution may count:

● revenue earned from a non-Title IV program of study, as long as the program is approved by the State, accredited, or provides an industry-recognized credential or certificate;

● institutional aid to students. *For loans* made to students by the institution from July 1, 2008, but before July 1, 2012, the net present value of the loans made during a fiscal year if the loans are evidenced by promissory notes, issued at intervals related to the institution’s enrollment periods, and are subject to regular loan repayments and collections.  For loans made on or after July 1, 2012, only the amount of loan repayments the institution receives during a fiscal year, excluding repayment on any loans for which the institution previously used the net present value in its 90/10 calculation.

*For scholarships*, only those provided by the institution in the form of monetary aid or tuition discounts based on the academic achievements or financial need of students, as long as the scholarships are disbursed during each fiscal year from an established restricted account, and only to the extent that funds in that account represent designated funds from an outside source or income earned on those funds; and

● the proceeds of Unsubsidized Stafford Loans that exceed the loan limits which were in effect on May 6, 2008, the day before the enactment of the Ensuring Continued Access to Student Loans Act of 2008 (ECASLA).  This provision applies to any Unsubsidized Stafford Loan received by a student on or after July 1, 2008, but before July 1, 2011.

The HEOA specifies the types or amounts of funds that are excluded from revenues under the 90/10 calculation. Excluded from revenues are: 

● the amount of funds the institution received under the FWS Program, unless it used those funds to pay for a student’s institutional charges;

● the amount of funds the institution received under LEAP;

● the amount of funds provided by the institution as matching funds under the Title IV programs;

● the amount of funds provided by the institution for a Title IV program that are required to be refunded or returned; and

● the amount charged for books, supplies, and equipment, unless the institution includes that amount as tuition, fees, or other institutional charges.

**Updated information since 3/2-4 meetings:**

The 90/10 requirements are removed from §600.5.

The PPA is amended by adding the 90/10 requirement.

A new section 668.28 is added to implement the statutory requirements.

A new Appendix C is added to illustrate the 90/10 calculation.

**Tentative Agreement:**

**Regulatory language:**

##### §600.5  Proprietary institution of higher education.

(a) ***

(6) Is accredited; and

     (7) Has been in existence for at least two years.~~; and~~

~~(8) Has no more than 90 percent of its revenues derived from title IV, HEA program funds, as determined under paragraph (d) of this section.~~

(b)(1) The Secretary considers an institution to have been in existence for two years only if—

***

~~(d)(1) An institution satisfies the requirement contained in paragraph (a)(8) of this section by examining its revenues under the following formula for its latest complete fiscal year:~~

~~Title IV, HEA program funds the institution used to satisfy its students' tuition, fees, and other institutional charges to students~~

~~The sum of revenues including title IV, HEA program funds generated by the institution from: tuition, fees, and other institutional charges for students enrolled in eligible programs as defined in 34 CFR 668.8; and activities conducted by the institution, to the extent not included in tuition, fees, and other institutional charges, that are necessary for the education or training of its students who are enrolled in those eligible programs.~~

~~(2) An institution must use the cash basis of accounting when calculating the amount of title IV, HEA program funds in the numerator and the total amount of revenue generated by the institution in the denominator of the fraction contained in paragraph (d)(1) of this section.~~

~~(3) Under the cash basis of accounting—~~

~~(i) In calculating the amount of revenue generated by the institution from institutional loans, the institution must include only the amount of loan repayments received by the institution during the fiscal year; and~~

~~(ii) In calculating the amount of revenue generated by the institution from institutional scholarships, the institution must include only the amount of funds it disbursed during the fiscal year from an established restricted account and only to the extent that the funds in that account represent designated funds from an outside source or income earned on those funds.~~

~~(e) With regard to the formula contained in paragraph(d)(1) of this section—~~

~~(1) The institution may not include as title IV, HEA program funds in the numerator nor as revenue generated by the institution in the denominator—~~

~~(i) The amount of funds it received under the Federal Work-Study (FWS) Program, unless the institution used those funds to pay a student's institutional charges in which case the FWS program funds used to pay those charges would be included in the numerator and denominator.~~

~~(ii) The amount of funds it received under the Leveraging Educational Assistance Partnership (LEAP) Program. (The LEAP Program was formerly called the State Student Incentive Grant or SSIG Program.);~~

~~(iii) The amount of institutional funds it used to match title IV, HEA program funds;~~

~~(iv) The amount of title IV, HEA program funds that must be refunded or returned under §668.22; or~~

~~(v) The amount charged for books, supplies, and equipment unless the institution includes that amount as tuition, fees, or other institutional charges.~~

~~(2) In determining the amount of title IV, HEA program funds received by the institution under the cash basis of accounting, except as provided in paragraph (e)(3) of this section, the institution must presume that any title IV, HEA program funds disbursed or delivered to or on behalf of a student will be used to pay the student's tuition, fees, or other institutional charges, regardless of whether the institution credits those funds to the student's account or pays those funds directly to the student, and therefore must include those funds in the numerator and denominator.~~

~~(3) In paragraph (e)(2) of this section, the institution may not presume that title IV, HEA program funds were used to pay tuition, fees, and other institutional charges to the extent that those charges were satisfied by—~~

~~(i) Grant funds provided by non-Federal public agencies, or private sources independent of the institution;~~

~~(ii) Funds provided under a contractual arrangement described in §600.7(d), or~~

~~(iii) Funds provided by State prepaid tuition plans.~~

~~(4) With regard to the denominator, revenue generated by the institution from activities it conducts, that are necessary for its students' education or training, includes only revenue from those activities that—~~

~~(i) Are conducted on campus or at a facility under the control of the institution;~~

~~(ii) Are performed under the supervision of a member of the institution's faculty; and~~

~~(iii) Are required to be performed by all students in a specific educational program at the institution.~~

~~(f) An institution must notify the Secretary within 90 days following the end of the fiscal year used in paragraph (d)(1) of this section if it fails to satisfy the requirement contained in paragraph (a)(8) of this section.~~

~~(g) If an institution loses its eligibility because it failed to satisfy the requirement contained in paragraph (a)(8) of this section, to regain its eligibility it must demonstrate compliance with all eligibility requirements for at least the fiscal year following the fiscal year used in paragraph (d)(1) of this section.~~

(~~h~~d) The Secretary does not recognize the accreditation of an institution unless the institution agrees to submit any dispute involving the final denial, withdrawal, or termination of accreditation to initial arbitration before initiating any other legal action.

§668.14 Program participation agreement.

***

(b) By entering into a program participation agreement, an institution agrees that—

***

(16) ~~Reserved~~For a proprietary institution, the institution will derive at least ten percent of its revenues for each fiscal year from sources other than title IV, HEA program funds, as provided in §668.28(a) and (b), or be subject to sanctions described in §668.28(c).

*****

§668.28 Non-title IV revenue (90/10)

(a) Calculating the revenue percentage (1) A proprietary institution determines whether it satisfies the requirement in §668.14(b)(16) that at least ten percent of its revenue is derived from sources other than title IV, HEA program funds by using the formula in Appendix C of this subpart to calculate its revenue percentage for its latest complete fiscal year. 

(2) Cash basis accounting.  Except for institutional loans made to students under paragraph (a)(5)(i) of this section, the institution must use the cash basis of accounting in calculating its revenue percentage.

(3) Revenue generated from programs and activities. The institution must consider as revenue only those funds it generates from—

(i) Tuition, fees, and other institutional charges for students enrolled in eligible programs as defined in §668.8;

(ii) Activities conducted by the institution that are necessary for the education and training of its students provided those activities are—

(A) Conducted on campus****or at a facility under the institution’s control;

(B) Performed under the supervision of a member of the institution’s faculty; and

(C) Required to be performed by all students in a specific educational program at the institution; and

(ii) Funds paid by a student, or on behalf of a student by a party other then the institution, for an education or training program that is not eligible under §668.8 if the program—

(A) Is approved or licensed by the appropriate State agency;

(B) Is accredited by an accrediting agency recognized by the Secretary under 34 CFR Part 602; or

(C) Provides an industry-recognized credential or certification.

(4) Application of funds.  The institution must presume that any title IV, HEA program funds it disburses, or delivers, to or on behalf of a student will be used to pay the student’s tuition, fees, or institutional charges,****regardless of whether the institution credits the funds to the student’s account or pays the funds directly to the student, except to the extent that the student’s tuition, fees, or other charges are satisfied by—

(i) Grant funds provided by non-Federal public agencies or private sources independent of the institution;

(ii) Funds provided under a contractual arrangement with a Federal, State, or local government agency for the purpose of providing job training to low-income individuals who need that training;

(iii) Funds used by a student from a savings plan for educational expenses established by or on behalf of the student if the saving plan qualifies for special tax treatment under the Internal Revenue Code of 1986; or

(iv) Institutional scholarships as provided under paragraph (a)(5)(iv) of this section.

(5) Revenue generated from institutional aid.  The institution must include the following institutional aid as revenue:

(i) For loans made to students on or after July 1, 2008 and prior to July 1, 2012, include as revenue the net present value of the loans made to students during the fiscal year, as calculated under paragraph (b) of this section, if the loans—

(A) Are bona fide as evidenced by enforceable promissory notes or installment sales contracts;

(B) Are issued at intervals related to the institution’s enrollment periods; and

(C) Are subject to regular loan repayments and collections;

(ii) For loans made to students before July 1, 2008, include as revenue only the amount of payments made on those loans that the institution received during the fiscal year;

(iii) For loans made to students on or after July 1, 2012, include as revenue only the amount of payments made on those loans that the institution received during the fiscal year; and

(iv) For scholarships provided by the institution in the form of monetary aid or tuition discount and based on the academic achievement or financial need of its students, include as revenue the amount disbursed to students during the fiscal year.  The scholarships must be disbursed from an established restricted account and only to the extent that the funds in that account represent designated funds from an outside source or income earned on those funds.****

(6) Revenue generated from loan funds in excess of loan limits prior to the Ensuring Continued Access to Student Loans Act of 2008 (ECASLA).**** For each student who receives an unsubsidized loan under the FFEL or Direct Loan programs on or after July 1, 2008 and prior to July 1, 2011, the amount of the loan disbursement that exceeds the loan limit in effect on the day prior to enactment of the ECASLA is included as revenue from a source other than title IV, HEA program funds but only to the extent that the excess amount pays for tuition, fees, or institutional charges remaining on the student’s account after title IV, HEA program funds are applied. 

(7) Funds excluded from revenues.  For the fiscal year, the institution does not include—

(i) The amount of Federal Work Study (FWS) wages paid directly to the student.  However, if the institution credits the student’s account with FWS funds, those funds are included as revenue;

(ii) The amount of funds received by the institution from a State under the LEAP, SLEAP, or GAP programs;

(iii) The amount of institutional funds used to match title IV, HEA program funds;

(iv) The amount of title IV, HEA program funds refunded or returned under §668.22; or

(v) The amount the charged for books, supplies, and equipment unless the institution includes that amount as tuition, fees, or other institutional charges.

(b) Net Present Value (NPV). (1) As illustrated in Appendix C of this subpart, an institution calculates the NPV of the loans it made under paragraph (a)(5)(i) of this section by—

(i) Using the formula, NPV = sum of the discounted cash flows *Rt*/(1+*i*)*t*, where--

(A) “*i*" is the discount rate.  For purposes of this section, an institution must use the most recent annual inflation rate as the discount rate;

(B) “*t*” is time or period of the cash flow, in years, from the time the loan entered repayment;

(C) “*Rt*” is the net cash flow at time or period *t*; and

(ii) From the loans made during the fiscal year-

(A) If the loans have substantially the same repayment period, using that period for the range of values of variable “*t”;*or

(B) Grouping the loans by repayment period and using the repayment period for each group for the range of values of variable “t”; and

(C) For each group of loans, as applicable, multiplying the total annual payments due on the loans by the institution’s loan collection rate (e.g. the total amount of payments collected divided by the total amount of payments due).  The resulting amount is used for variable “*R*” in each period “*t*”, for each group of loans that a NPV is calculated; or

(2) Instead of performing the calculations in paragraph (b)(1) of this section, using 50 percent of the total amount of loans that the institution made during the fiscal year as the NPV.

(c) Sanctions. If an institution does not derive at least ten percent of its revenue from sources other than title IV, HEA program funds--

(1) For two consecutive fiscal years, it loses its eligibility to participate in the title IV, HEA programs for at least two fiscal years.  To regain eligibility, the institution must demonstrate that it complied with the State licensure and accreditation requirements under 34 CFR 600.5(a)(4) and (a)(6), and the financial responsibility requirements under subpart L of this part, for a minimum of two fiscal years after the fiscal year it became ineligible; or

(2) For any fiscal year, it becomes provisionally certified under §668.13(c)(1)(ii) for the two fiscal years after the fiscal year it failed to satisfy the revenue requirement.  However, the institution’s provisional certification terminates on--

(i) The expiration date of institution’s program participation agreement that was in effect on the date the Secretary determined the institution failed this requirement; or 

(ii) The date the institution loses its eligibility to participate under paragraph (c)(1) of this section; and

(3) It must notify the Secretary no later than 45 days after the end of its fiscal year that it failed to meet this requirement. 

**§668.13  Certification procedures**

*******

(c) *Provisional certification.*(1)(i) The Secretary may provisionally certify an institution if—

(A) The institution seeks initial participation in a Title IV, HEA program;

(B) The institution is an eligible institution that has undergone a change in ownership that results in a change in control according to the provisions of 34 CFR part 600;

(C) The institution is a participating institution—

() That is applying for a certification that the institution meets the standards of this subpart;

() That the Secretary determines has jeopardized its ability to perform its financial responsibilities by not meeting the factors of financial responsibility under §668.15 or the standards of administrative capability under §668.16; and

() Whose participation has been limited or suspended under subpart G of this part, or voluntarily enters into provisional certification;

(D) The institution seeks a renewal of participation in a Title IV, HEA program after the expiration of a prior period of participation in that program; or

(E) The institution is a participating institution that was accredited or preaccredited by a nationally recognized accrediting agency on the day before the Secretary withdrew the Secretary's recognition of that agency according to the provisions contained in 34 CFR part 603.

(ii) A proprietary institution’s certification automatically becomes provisional if it does not derive at least ten percent of its revenue for any fiscal year from sources other than title IV, HEA program funds, as required under §668.14(b)(16).

**Statutory language:**

**(d)**IMPLEMENTATION OF NON-TITLE IV REVENUE REQUIREMENT.—

**(1)**CALCULATION.—In making calculations under subsection (a)(24), a proprietary institution of higher education shall—

**(A)**use the cash basis of accounting, except in the case of loans described in subparagraph (D)(i) that are made by the proprietary institution of higher education;

**(B)**consider as revenue only those funds generated by the institution from—

**(i)**tuition, fees, and other institutional charges for students enrolled in programs eligible for assistance under this title;

**(ii)**activities conducted by the institution that are necessary for the education and training of the institution’s students, if such activities are—

**(I)**conducted on campus or at a facility under the control of the institution;

**(II)**performed under the supervision of a member of the institution’s faculty; and

**(III)**required to be performed by all students in a specific educational program at the institution; and

**(iii)**funds paid by a student, or on behalf of a student by a party other than the institution, for an education or training program that is not eligible for funds under this title, if the program—

**(I)**is approved or licensed by the appropriate State agency;

**(II)**is accredited by an accrediting agency recognized by the Secretary; or

**(III)**provides an industry-recognized credential or certification;

**(C)**presume that any funds for a program under this title that are disbursed or delivered to or on behalf of a student will be used to pay the student’s tuition, fees, or other institutional charges, regardless of whether the institution credits those funds to the student’s account or pays those funds directly to the student, except to the extent that the student’s tuition, fees, or other institutional charges are satisfied by—

**(i)**grant funds provided by non-Federal public agencies or private sources independent of the institution;

**(ii)**funds provided under a contractual arrangement with a Federal, State, or local government agency for the purpose of providing job training to low-income individuals who are in need of that training;

**(iii)**funds used by a student from savings plans for educational expenses established by or on behalf of the student and which qualify for special tax treatment under the Internal Revenue Code of 1986; or

**(iv)**institutional scholarships described in subparagraph (D)(iii);

**(D)**include institutional aid as revenue to the school only as follows:

**(i)**in the case of loans made by a proprietary institution of higher education on or after July 1, 2008 and prior to July 1, 2012, the net present value of such loans made by the institution during the applicable institutional fiscal year accounted for on an accrual basis and estimated in accordance with generally accepted accounting principles and related standards and guidance, if the loans—

**(I)**are bona fide as evidenced by enforceable promissory notes;

**(II)**are issued at intervals related to the institution’s enrollment periods; and

**(III)**are subject to regular loan repayments and collections;

**(ii)**in the case of loans made by a proprietary institution of higher education on or after July 1, 2012, only the amount of loan repayments received during the applicable institutional fiscal year, excluding repayments on loans made and accounted for as specified in clause (i); and

**(iii)**in the case of scholarships provided by a proprietary institution of higher education, only those scholarships provided by the institution in the form of monetary aid or tuition discounts based upon the academic achievements or financial need of students, disbursed during each fiscal year from an established restricted account, and only to the extent that funds in that account represent designated funds from an outside source or from income earned on those funds;

**(E)**in the case of each student who receives a loan on or after July 1, 2008, and prior to July 1, 2011, that is authorized under section 428H or that is a Federal Direct Unsubsidized Stafford Loan, treat as revenue received by the institution from sources other than funds received under this title, the amount by which the disbursement of such loan received by the institution exceeds the limit on such loan in effect on the day before the date of enactment of the Ensuring Continued Access to Student Loans Act of 2008; and

**(F)**exclude from revenues—

**(i)**the amount of funds the institution received under part C, unless the institution used those funds to pay a student’s institutional charges;

**(ii)**the amount of funds the institution received under subpart 4 of part A;

**(iii)**the amount of funds provided by the institution as matching funds for a program under this title;

**(iv)**the amount of funds provided by the institution for a program under this title that are required to be refunded or returned; and

**(v)**the amount charged for books, supplies, and equipment, unless the institution includes that amount as tuition, fees, or other institutional charges.

**(2)**SANCTIONS.—

**(A)**INELIGIBILITY.—A proprietary institution of higher education that fails to meet a requirement of subsection (a)(24) for two consecutive institutional fiscal years shall be ineligible to participate in the programs authorized by this title for a period of not less than two institutional fiscal years. To regain eligibility to participate in the programs authorized by this title, a proprietary institution of higher education shall demonstrate compliance with all eligibility and certification requirements under section 498 for a minimum of two institutional fiscal years after the institutional fiscal year in which the institution became ineligible.

**(B)**ADDITIONAL ENFORCEMENT.—In addition to such other means of enforcing the requirements of this title as may be available to the Secretary, if a proprietary institution of higher education fails to meet a requirement of subsection (a)(24) for any institutional fiscal year, then the institution’s eligibility to participate in the programs authorized by this title becomes provisional for the two institutional fiscal years after the institutional fiscal year in which the institution failed to meet the requirement of subsection (a)(24), except that such provisional eligibility shall terminate—

**(i)**on the expiration date of the institution’s program participation agreement under this subsection that is in effect on the date the Secretary determines that the institution failed to meet the requirement of subsection (a)(24); or

**(ii)**in the case that the Secretary determines that the institution failed to meet a requirement of subsection (a)(24) for two consecutive institutional fiscal years, on the date the institution is determined ineligible in accordance with subparagraph (A).

**(3)**PUBLICATION ON COLLEGE NAVIGATOR WEBSITE.—The Secretary shall publicly disclose on the College Navigator website—

**(A)**the identity of any proprietary institution of higher education that fails to meet a requirement of subsection (a)(24); and

**(B)**the extent to which the institution failed to meet such requirement.

**(4)**REPORT TO CONGRESS.—Not later than July 1, 2009, and July 1 of each succeeding year, the Secretary shall submit to the authorizing committees a report that contains, for each proprietary institution of higher education that receives assistance under this title, as provided in the audited financial statements submitted to the Secretary by each institution pursuant to the requirements of subsection (a)(24)—

**(A)**the amount and percentage of such institution’s revenues received from sources under this title; and

**(B)**the amount and percentage of such institution’s revenues received from other sources.

**Issue Paper #10**

**Origin:**HEOA

**Issue:**Consumer Information

**Statutory cites:**Section 485(a) of the HEA

**Regulatory cites:**668.43(c)

**DCL GEN-08-12 cite:**Pages 95-96

**Summary of issue:**The HEOA expands the list of information that institutions are required to make available to prospective and enrolled students.  In addition to the requirements listed in §485(a) of the HEA, institutions must now also include information on:

● The placement of and types of employment obtained by graduates of the institutions’ degree or certificate programs;

● The types of graduate and professional education in which graduates of the institutions’ four-year degree programs enrolled; and 

● The retention rates of certificate or degree seeking first-time full-time undergraduate students entering the institution.

The HEOA provides that the information in the first two bullets may be gathered from sources such as alumni surveys, student satisfaction surveys, the National Survey of Student Engagement, the Community College Survey of Student Engagement, State data systems, or other relevant sources.

The HEOA amends subparagraph (L) of section 485(a)(1) of the HEA regarding completion and graduation rates disclosed to exclude the completion or graduation rates of students who leave school to serve in the Armed Forces, on official church missions, or with a recognized foreign aid service of the Federal Government.  In cases where these types of students represent 20 percent or more of the certificate or degree-seeking fulltime undergraduate students at the institution, the institution may recalculate the completion or graduate rates of such students by excluding from the calculation the time period such students weren’t enrolled due to their service in those categories. The same exclusions from reporting requirements are also reflected in amended section 485(e) of the HEA with respect to the disclosure of athletically related graduation rates.

The HEOA now also requires institutions to disaggregate completion and graduation rate data with respect to (1) existing section 485(a)(1)(L) of the HEA, which requires institutions to disclose the completion and graduation rate of certificate- or degreeseeking, full-time, undergraduate students; and (2) existing section 485(e) of the HEA, which requires institutions to disclose and submit annually to the Department completion or graduation rates for student-athletes. The data must be disaggregated based on gender, race/ethnicity and receipt of a Federal Pell Grant, receipt of a FFEL or Direct Loan (but not an unsubsidized Stafford or Federal Direct Unsubsidized Stafford) but not a Federal Pell Grant, and non- receipt of a Federal Pell Grant or Federal loans (other than an unsubsidized Stafford or Federal Direct Unsubsidized Stafford). The HEOA provides an exception where institutions may note instances where the statistical number is too small and would not yield statistically reliable information or would reveal personally identifiable information. These requirements will not apply to two-year degree-granting institutions until the 2011-2012 academic year.

**Updated information since 3/2-4:**

We have added information on retention rates, placement rates, and graduate programs into which an institution’s graduates enroll, to the general disclosures that institutions must make to students and prospective students under §668.41.  Further, we have added transfer and retention rate information to §668.45, and addressed the need to disaggregate completion and graduation rates in a number of ways in that same section, as required by the statute.  And we have addressed the statutory recalculation option (for completion and graduation) related to students who leave school to serve in the Armed Forces, on church missions, or with a Federal foreign aid service.

**Tentative agreement:**

**Regulatory language:**

§668.41  Reporting and disclosure of information.

***

(d) General disclosures for enrolled or prospective students*.*An institution must make available to any enrolled student or prospective student, on request, through appropriate publications, mailings or electronic media, information concerning—

(1) Financial assistance available to students enrolled in the institution (pursuant to §668.42);

(2) The institution (pursuant to §668.43); 

(3) The institution’s retention rate (pursuant to §668.45). In the case of a request from a prospective student, the information must be made available prior to the student's enrolling or entering into any financial obligation with the institution;

(4) The institution's completion or graduation rate and, if applicable, its transfer-out rate (pursuant to §668.45).  In the case of a request from a prospective student, the information must be made available prior to the student's enrolling or entering into any financial obligation with the institution;

(5)  The institution’s placement rate.  The placement of, and types of employment obtained by, graduates of the institution’s degree or certificate programs.  This information may be gathered from alumni surveys, student satisfaction surveys, the National Survey of Student Engagement, the Community College Survey of Student Engagement, State data systems, or other relevant sources; and

(6)  The types of graduate and professional education in which graduates of the institution’s four-year degree programs enroll.  This information may be gathered from alumni surveys, student satisfaction surveys, the National Survey of Student Engagement, State data systems, or other relevant sources.

*****

§668.45  Information on completion or graduation rates, transfer rates, and retention rates. 

(a)(1) An institution annually must prepare the completion or graduation rate of its certificate- or degree-seeking, first-time, full-time undergraduate students, as provided in paragraph (b) of this section, and the retention rate of its certificate or degree seeking, first-time, full-time undergraduate students as provided in paragraph (d).

(2) An institution that determines that its mission includes providing substantial preparation for students to enroll in another eligible institution must prepare the transfer-out rate of its certificate- or degree-seeking, first-time, full-time undergraduate students, as provided in paragraph (c) of this section.

(3)(i) An institution that offers a predominant number of its programs based on semesters, trimesters, or quarters must base its completion or graduation rate, retention rate, and, if applicable, transfer-out rate on the cohort of first-time, certificate- or degree-seeking, full-time undergraduate students who enter the institution during the fall term of each year.

(ii) An institution not covered by the provisions of paragraph (a)(3)(i) of this section must base its completion or graduation rate, retention rate, and, if applicable, transfer-out rate  on the cohort of first-time, certificate- or degree-seeking, full-time undergraduate students who enter the institution between September 1 of one year and August 31 of the following year.

(4)(i) An institution covered by the provisions of paragraph (a)(3)(i) of this section must count as an entering student a first-time undergraduate student who is enrolled as of October 15, the end of the institution's drop-add period, or another official reporting date as defined in §668.41(a).

(ii) An institution covered by paragraph (a)(3)(ii) of this section must count as an entering student a first-time undergraduate student who is enrolled for at least—

(A) 15 days, in a program of up to, and including, one year in length; or

(B) 30 days, in a program of greater than one year in length.

(5) An institution must make available its completion or graduation rate, retention rate, and, if applicable, transfer-out rate, no later than the July 1 immediately following the 12-month period ending August 31 during which 150% of the normal time for completion or graduation has elapsed for all of the students in the group on which the institution bases its completion or graduation rate, retention rate, and, if applicable, transfer-out rate.

(6)(i) Completion or graduation rate information must be disaggregated by gender, by each major racial and ethnic subgroup, by recipients of a Federal Pell Grant, by recipients of a Federal Family Education Loan or a Federal Direct Loan (other than an Unsubsidized Stafford Loan made under the Federal Family Education Loan Program or a Federal Direct Unsubsidized Stafford Loan) who did not receive a Federal Pell Grant, and by recipients of neither a Federal Pell Grant nor a Federal Family Education Loan or a Federal Direct Loan (other than an Unsubsidized Stafford Loan made under the Federal Family Education Loan Program or a Federal Direct Unsubsidized Stafford Loan)if the number of students in such group or with such status is sufficient to yield statistically reliable information and reporting will not reveal personally identifiable information about an individual student.  If such number is not sufficient for such purpose, then the institution shall note that the institution enrolled too few of such students to so disclose or report with confidence and confidentiality.

(ii) The requirement in (6)(i) of this paragraph shall not apply to two-year, degree-granting institutions of higher education until academic year 2011-2012.

(b) In calculating the completion or graduation rate under paragraph (a)(1) of this section, an institution must count as completed or graduated—

(1) Students who have completed or graduated by the end of the 12-month period ending August 31 during which 150% of the normal time for completion or graduation from their program has lapsed; and

(2) Students who have completed a program described in §668.8(b)(1)(ii), or an equivalent program, by the end of the 12-month period ending August 31 during which 150% of normal time for completion from that program has lapsed.

(c) In calculating the transfer-out rate under paragraph (a)(2) of this section, an institution must count as transfers-out students who, by the end of the 12-month period ending August 31 during which 150% of the normal time for completion or graduation from the program in which they were enrolled has lapsed, have not completed or graduated but have subsequently enrolled in any program of an eligible institution for which its program provided substantial preparation.

(d)  In calculating the retention rate under paragraph (a)(1) of this section, except as noted in paragraph (e) of this section, an institution must use the definition of a retention rate used by the Integrated Postsecondary Education Data System (IPEDS), which indicates that the retention rate is “a measure of the rate at which students persist in their educational program at an institution, expressed as a percentage.”  For four-year institutions , this is the percentage of first-time bachelors (or equivalent) degree-seeking undergraduates from the previous fall who are again enrolled in the current fall. For all other institutions this is the percentage of first-time degree/certificate-seeking students from the previous fall who either re-enrolled or successfully completed their program by the current fall.

(e) For the purpose of calculating a completion or graduation rate, a transfer-out rate, and a retention rate, an institution may 

(1) Exclude students who --

(i) Have left school to serve in the Armed Forces;

(ii) Have left school to serve on official church missions;

(iii) Have left school to serve with a foreign aid service of the Federal Government, such as the Peace Corps;

(iv) Are totally and permanently disabled; or

(v) Are deceased; or

(2) In cases where the students described in paragraphs (e)(1)(i) through (iv) of this paragraph represent 20 percent or more of the certificate- or degree-seeking, full-time, undergraduate students at the institution, recalculate the completion or graduation rates of those students by adding to the 150% time-frame they normally have to complete or graduate, as described in paragraph (b) of this section, the time period the students were not enrolled due to their service in the Armed Forces, on official church missions, or with a recognized foreign aid service of the Federal Government.  

(f)(1) The Secretary grants a waiver of the requirements of this section to any institution that is a member of an athletic association or conference that has voluntarily published completion or graduation rate data, or has agreed to publish data, that the Secretary determines are substantially comparable to the completion or graduation rate data required by this section.  

(2) An institution that receives a waiver of the requirements of this section must still comply with the requirements of §668.41(d)(3) and (f).

(3) An institution, or athletic association or conference applying on behalf of an institution, that seeks a waiver under paragraph (f)(1) of this section must submit a written application to the Secretary that explains why it believes the data the athletic association or conference publishes are accurate and substantially comparable to the information required by this section.

(g) In addition to calculating the completion or graduation rate and the retention rate required by paragraph (a)(1) of this section, an institution may, but is not required to—

(1) Calculate a completion or graduation rate for students who transfer into the institution;

(2) Calculate a completion or graduation rate,, , and a retention rate for students described in paragraphs (e)(1) through (4) of this section; and

(3) Calculate a transfer-out rate as specified in paragraph (c) of this section, if the institution determines that its mission does not include providing substantial preparation for its students to enroll in another eligible institution.

**§668.48  Report on completion or graduation rates for student-athletes.**

***

(b) The provisions of §668.45 (a), (b), (c), and (e) apply for purposes of calculating the completion or graduation rates and, if applicable, transfer-out rates required under paragraphs (a)(1)(iii) through (vi) of this section.

*****

**Statutory Language:**

SEC. 485 INSTITUTIONAL AND FINANCIAL ASSISTANCE INFORMATION FOR STUDENTS.

**(a)**INFORMATION DISSEMINATION ACTIVITIES.—

**(1)**Each eligible institution participating in any program under this title shall carry out information dissemination activities for prospective and enrolled students (including those attending or planning to attend less than full time) regarding the institution and all financial assistance under this title. The information required by this section shall be produced and be made readily available upon request, through appropriate publications, mailings, and electronic media, to an enrolled student and to any prospective student. Each eligible institution shall, on an annual basis, provide to all enrolled students a list of the information that is required to be provided by institutions to students by this section and section 444 of the General Education Provisions Act (also referred to as the Family Educational Rights and Privacy Act of 1974), together with a statement of the procedures required to obtain such information. The information required by this section shall accurately describe—

* * * * *

**(R)**the placement in employment of, and types of employment obtained by, graduates of the institution’s degree or certificate programs, gathered from such sources as alumni surveys, student satisfaction surveys, the National Survey of Student Engagement, the Community College Survey of Student Engagement, State data systems, or other relevant sources;

**(S)**the types of graduate and professional education in which graduates of the institution’s four-year degree programs enrolled, gathered from such sources as alumni surveys, student satisfaction surveys, the National Survey of Student Engagement, State data systems, or other relevant sources;

* * * * * 

**(U)**the retention rate of certificate- or degree-seeking, first-time, full-time, undergraduate students entering such institution; and

* * * * *

**(3)**In calculating the completion or graduation rate under subparagraph (L) of paragraph (1) of this subsection or under subsection (e), a student shall be counted as a completion or graduation if, within 150 percent of the normal time for completion of or graduation from the program, the student has completed or graduated from the program, or enrolled in any program of an eligible institution for which the prior program provides substantial preparation. The information required to be disclosed under such subparagraph—

**(A)**shall be made available by July 1 each year to enrolled students and prospective students prior to the students enrolling or entering into any financial obligation; and

**(B)**shall cover the one-year period ending on August 31 of the preceding year.

~~(4) For purposes of this section, institutions may exclude from the information disclosed in accordance with subparagraph (L) of paragraph (1) the completion or graduation rates of students who leave school to serve in the armed services, on official church missions, or with a recognized foreign aid service of the Federal Government.~~

**(4)**For purposes of this section, institutions may—

**(A)**exclude from the information disclosed in accordance with subparagraph (L) of paragraph (1) the completion or graduation rates of students who leave school to serve in the Armed Forces, on official church missions, or with a recognized foreign aid service of the Federal Government; or 

**(B)**in cases where the students described in subparagraph (A) represent 20 percent or more of the certificate- or degree-seeking, full-time, undergraduate students at the institution, recalculate the completion or graduation rates of such students by excluding from the calculation described in paragraph (3) the time period such students were not enrolled due to their service in the Armed Forces, on official church missions, or with a recognized foreign aid service of the Federal Government.

**(5)**The Secretary shall permit any institution of higher education that is a member of an athletic association or athletic conference that has voluntarily published completion or graduation rate data or has agreed to publish data that, in the opinion of the Secretary, is substantially comparable to the information required under this subsection, to use such data to satisfy the requirements of this subsection; and 

**(6)**Each institution may provide supplemental information to enrolled and prospective students showing the completion or graduation rate for students described in paragraph (4) or for students transferring into the institution or information showing the rate at which students transfer out of the institution.

**(7)(A)(i)**Subject to clause (ii), the information disseminated under paragraph (1)(L), or reported under subsection (e), shall be disaggregated by gender, by each major racial and ethnic subgroup, by recipients of a Federal Pell Grant, by recipients of a loan made under part B or D (other than a loan made under section 428H or a Federal Direct Unsubsidized Stafford Loan) who did not receive a Federal Pell Grant, and by recipients of neither a Federal Pell Grant nor a loan made under part B or D (other than a loan made under section 428H or a Federal Direct Unsubsidized Stafford Loan), if the number of students in such subgroup or with such status is sufficient to yield statistically reliable information and reporting will not reveal personally identifiable information about an individual student. If such number is not sufficient for such purposes, then the institution shall note that the institution enrolled too few of such students to so disclose or report with confidence and confidentiality.

**(ii)**The requirements of clause (i) shall not apply to two-year, degree-granting institutions of higher education until academic year 2011-2012.

**Issue Paper # 11**

**Origin:**HEOA

**Issue:**Disclosure of Fire Safety Standards and Measures

**Statutory cites:**Section 485(i) of the HEA

**Regulatory cites:**§668.41 and §668.49

**DCL GEN-08-12 cite:**Pages 99-100

**Summary of issue:**The HEOA requires that all Title IV eligible institutions that participate in any Title IV program and that maintain on-campus student housing facilities publish an annual fire safety report. 

This report must contain information about campus fire safety practices and standards, including:

· Statistics for each on-campus housing facility, during the most recent calendar years for which data are available, concerning each of the following:

· The number of fires and the cause of each fire;

· The number of injuries related to each fire that result in treatment at a medical facility;

· The number of deaths related to each fire; and

· The value of property damage caused by each fire.

· A description of each on-campus student housing facility fire safety and sprinkler system;

· The number of regular mandatory supervised fire drills;

· The policies or rules on portable electrical appliances, smoking, open flames (such as candles);

· The procedures for evacuation;

· The policies regarding fire safety education and training programs provided to students, faculty, and staff; and

· Plans for future improvements in fire safety, if determined necessary by the institution. 

Institutions participating in any Title IV programs must submit a copy of the statistics required in the first bullet to the Secretary on an annual basis.  Furthermore, institutions must create and maintain a log of all fires in on-campus student housing facilities, including the nature, date, time, and general location of each fire, and prepare and submit annual reports to the campus community on those fires.  

**Updated information since 3/2-4 meetings:**Section 668.41(e) would be amended to require that the publication of the annual fire safety report mirror that of the annual security report.  A new §668.49 would be added to implement the requirements in section 485(i) of the HEA regarding institutional fire safety policies and fire statistics.  Paragraph (a) defines additional terms that apply to the new section, including ‘cause of fire,’ ‘fire,’ ‘fire drill,’ ‘fire-related injury,’ ‘fire-related death,’ ‘fire safety system,’ and ‘value of property damage.’  Definitions were taken when available from the National Fire Incident Reporting System in order to maintain consistency across definitions.  Paragraphs (b) and (c) describe the information that an institution must include in the annual fire safety report, as required by the statute, as well as the statistics that an institution must report to the campus community and to the Secretary.  Paragraph (d) clarifies that an institution may choose to combine its annual fire safety report with the annual security report; however, it must be clear to the reader that both reports are included.  If an institution does not combine the reports, a direct link must be provided in each report to the other report so that it is easy for consumers to find and compare information.  Paragraph (e) describes requirements for the campus fire log, which mirrors the crime log required in §668.46(f).  

**Tentative Agreement:**

**Regulatory Language:**

§668.41 Reporting and disclosure of information.

***

(e) Annual security report and annual fire safety report*–*(1) *Enrolled students and current employees – annual security report and annual fire safety report.*By October 1 of each year, an institution must distribute, to all enrolled students and current employees, its annual security report described in §668.46(b), and its annual fire safety report described in §668.49(b), through appropriate publications and mailings, including--

* * *

(e)(2) Enrolled students – annual security report and annual fire safety report*.*If an institution chooses to distribute its annual security report or its annual fire safety report to enrolled students by posting the disclosure on an Internet website or an Intranet website, the institution must comply with the requirements of paragraph (c)(2) of this section.

(e)(3) Current employees – annual security report and annual fire safety report*.*If an institution chooses to distribute its annual security report or its annual fire safety report to current employees by posting the disclosure on an Internet website or an Intranet website, the institution must, by October 1 of each year, distribute to all current employees a notice that includes a statement of the report’s availability, the exact electronic address at which the report is posted, a brief description of the report’s contents, and a statement that the institution will provide a paper copy of the report upon request.

(e)(4) *Prospective students and prospective employees – annual security report and annual fire safety report*.  For each of the reports, t~~T~~he institution must provide a notice to prospective students and prospective employees that includes a statement of the report’s availability, a description of its contents, and an opportunity to request a copy.  An institution must provide its annual security report and/or its annual fire safety report, upon request, to a prospective students or prospective employee.  If the institution chooses to provide its annual security report or its annual fire safety report to prospective students and prospective employees by posting the disclosure on an Internet website, the notice described in this paragraph must include the exact electronic address at which the report is posted, a brief description of the report, and a statement that the institution will provide a paper copy of the report upon request.

(e)(5) Submission to the Secretary – annual security report and annual fire safety report*.*Each year, by the date and in a form specified by the Secretary, an institution must submit the statistics required by §668.46(c) and §668.49(c) to the Secretary.

* * * * *

**§668.49 Institutional fire safety policies and fire statistics.**

(a) *Additional definitions that apply to this section.*

*Cause of fire:*The cause of ignition of a fire, as defined in the National Fire Incident Reporting System Complete Reference Guide.

*Fire:* Any instance of open flame or other burning in a place not intended to contain the burning.

*Fire drill:*A supervised practice of a mandatory evacuation of a building for a fire. 

*Fire-related injury:* Any instance in which a person is injured as a result of a fire, including injuries from natural or accidental causes sustained while involved in the activities of fire control, attempting rescue, or escaping from the dangers of the fire.  This may include students, faculty, staff, visitors, firefighters, or any other person injured as a result of a fire.

*Fire-related death:* Any instance in which a person is killed as a result of a fire, including deaths from natural or accidental causes sustained while involved in the activities of fire control, attempting rescue, or escaping from the dangers of a fire.  Deaths also include people who die within 1 year because of injuries sustained from the fire.

*Fire safety system:* Any mechanism or system related to the detection of a fire, the warning resulting from a fire, or the control of a fire.  This may include a sprinkler system, fire detection devices, stand-alone smoke alarms, devices that alert one to the presence of a fire, such as horns, bells, or strobe lights; smoke-control and reduction mechanisms; and fire doors and walls that reduce the spread of a fire.

*Value of Property Damage:*The estimated value of the loss of the structure and contents, in terms of the cost of replacement in like kind and quantity.  This estimate should include contents damaged by fire, smoke, water, and overhaul; however, it does not include indirect loss, such as business interruption.  

(b)  *Annual fire safety report.*An institution that maintains any on-campus student housing facility must prepare an annual fire safety report that contains, at a minimum, the following information:

(1) The fire statistics described in paragraph (c) of this section;

(2) A description of each on-campus student housing facility fire safety and sprinkler system, including the type, age, design, area covered, activation sensitivity, and other pertinent information;

(3) The number of fire drills;

(4) The policies or rules on portable electrical appliances, smoking, and open flames in a student housing facility;

(5) The procedures for evacuation in the case of a fire;

(6)  A list of the titles of each person or organization to which students and employees should report a fire;  

(7) The policies regarding fire safety education and training programs provided to the students, faculty, and staff; and

(8) Plans for future improvements in fire safety, if determined necessary by the institution.

(c) *Fire statistics.*(1)  An institution must report statistics for each on-campus housing facility, for the three most recent calendar years for which data are available, concerning- 

(i) The number of fires and the cause of each fire;

(ii) The number of injuries related to a fire that resulted in treatment at a medical facility, including at an on-campus health center;

(iii) The number of deaths related to a fire; and

(iv) The value of property damage caused by a fire.

(2)  An institution is required to submit a copy of the statistics in paragraph (1) to the Secretary on an annual basis.

(d) *Publication of the annual fire safety report.*(1) An institution must publish and distribute its annual fire safety report in accordance with paragraph (e) of this section. 

(2) An institution may publish its annual fire safety report concurrently with its annual security report only if the title of the report clearly states that the report contains both the annual security report and the annual fire safety report.  If an institution chooses to publish the annual fire safety report separately from the annual security report, it must include information in each of the two reports about where or how to directly access the other.

(e) *Fire log.* (1) An institution that maintains on-campus student housing facilities must maintain a written, easily understood fire log that records, by the date that the fire was reported, any fire that occurred in an on-campus student housing facility.  This log must include the nature, date, time and general location of each fire.

(2) An institution must make an entry or an addition to an entry to the log within two business days, as defined under §668.46(a), of the report of the information to the campus fire department.

(3) An institution must make the fire log for the most recent 60-day period open to public inspection during normal business hours.  The institution must make any portion of the log older than 60 days available within two business days of a request for public inspection.

(4) An institution must make an annual report to the campus community on the fires recorded in the fire log.  This report may be included as a part of the annual fire safety report.

**Statutory Language:**

**(i)**DISCLOSURE OF FIRE SAFETY STANDARDS AND MEASURES.—

**(1)**ANNUAL FIRE SAFETY REPORTS ON STUDENT HOUSING REQUIRED.—Each eligible institution participating in any program under this title that maintains on-campus student housing facilities shall, on an annual basis, publish a fire safety report, which shall contain information with respect to the campus fire safety practices and standards of that institution, including—

**(A)**statistics concerning the following in each on-campus student housing facility during the most recent calendar years for which data are available:

**(i)**the number of fires and the cause of each fire;

**(ii)**the number of injuries related to a fire that result in treatment at a medical facility;

**(iii)**the number of deaths related to a fire; and

**(iv)**the value of property damage caused by a fire;

**(B)**a description of each on-campus student housing facility fire safety system, including the fire sprinkler system;

**(C)**the number of regular mandatory supervised fire drills;

**(D)**policies or rules on portable electrical appliances, smoking, and open flames (such as candles), procedures for evacuation, and policies regarding fire safety education and training programs provided to students, faculty, and staff; and

**(E)**plans for future improvements in fire safety, if determined necessary by such institution.

**(2)**REPORT TO THE SECRETARY.—Each eligible institution participating in any program under this title shall, on an annual basis, submit to the Secretary a copy of the statistics required to be made available under paragraph (1)(A).

**(3)**CURRENT INFORMATION TO CAMPUS COMMUNITY.—Each eligible institution participating in any program under this title shall—

**(A)**make, keep, and maintain a log, recording all fires in on-campus student housing facilities, including the nature, date, time, and general location of each fire; and

**(B)**make annual reports to the campus community on such fires.

**(4)**RESPONSIBILITIES OF THE SECRETARY.—The Secretary shall—

**(A)**make the statistics submitted under paragraph (1)(A) to the Secretary available to the public; and

**(B)**in coordination with nationally recognized fire organizations and representatives of institutions of higher education, representatives of associations of institutions of higher education, and other organizations that represent and house a significant number of students—

**(i)**identify exemplary fire safety policies, procedures, programs, and practices, including the installation, to the technical standards of the National Fire Protection Association, of fire detection, prevention, and protection technologies in student housing, dormitories, and other buildings;

**(ii)**disseminate the exemplary policies, procedures, programs and practices described in clause (i) to the Administrator of the United States Fire Administration;

**(iii)**make available to the public information concerning those policies, procedures, programs, and practices that have proven effective in the reduction of fires; and

**(iv)**develop a protocol for institutions to review the status of their fire safety systems.

**(5)**RULES OF CONSTRUCTION.—Nothing in this subsection shall be construed to—

**(A)**authorize the Secretary to require particular policies, procedures, programs, or practices by institutions of higher education with respect to fire safety, other than with respect to the collection, reporting, and dissemination of information required by this subsection;

**(B)**affect section 444 of the General Education Provisions Act (the Family Educational Rights and Privacy Act of 1974) or the regulations issued under section 264 of the Health Insurance Portability and Accountability Act of 1996 (42 U.S.C. 1320d–2 note);

**(C)**create a cause of action against any institution of higher education or any employee of such an institution for any civil liability; or

**(D)**establish any standard of care.

**(6)**COMPLIANCE REPORT.—The Secretary shall annually report to the authorizing committees regarding compliance with this subsection by institutions of higher education, including an up-to-date report on the Secretary’s monitoring of such compliance.

**(7)**EVIDENCE.—Notwithstanding any other provision of law, evidence regarding compliance or noncompliance with this subsection shall not be admissible as evidence in any proceeding of any court, agency, board, or other entity, except with respect to an action to enforce this subsection.

**Issue Paper #12**

**Origin:**HEOA

**Issue:**Missing Person Procedures

**Statutory cites:**Section 485(j) of the HEA

**Regulatory cites:**§668.41, §668.46(b)(14) and §668.46(h) 

**DCL GEN-08-12 cite:**Pages 100-101

**Summary of issue:**The HEOA requires Title IV eligible institutions that provide on-campus housing to establish a missing student notification policy for students who reside in on-campus housing.

This policy must:

· Inform each student of the option to identify a contact person whom the institution may notify in the case that the student is determined missing, according to the institution’s official notification procedures described below;

· Provide each student a means to register this confidential contact information; 

· Advise each student who is under 18 years of age, and is not an emancipated individual, that if the student is determined missing, then the institution must notify a custodial parent or guardian within 24 hours; and

· Require the institution to initiate the emergency contact procedures in accordance with the student’s designation if the campus security or law enforcement entity has been notified and has determined that such student has been missing for more than 24 hours and has not returned to campus.

Section 485(j) of the HEA also requires that institutions establish notification procedures for a missing student who resides in on-campus housing that:

· Includes procedures for official notification that a student has been missing for more than 24 hours to the appropriate individuals at the institution; 

· Requires any official missing person report regarding such student to be referred immediately to the institution’s police or campus security department; and

· Requires, if the campus security department determines that such student has in fact been missing for more than 24 hours, that the department notify the appropriate individuals:

· If the missing student has identified a contact in accordance with the first bullet above, then such individual should be notified.

· If the missing student is under 18 and not emancipated, then the department must immediately notify such student’s custodial parent or legal guardian.

· If neither of the preceding two scenarios applies to a student determined to be a missing person, then the department will inform the appropriate law enforcement agency.

**Updated information since 3/2-4 meetings:**Sections 668.41(a) and 668.46 would be amended to define additional terms that apply to subpart D, including ‘student housing facility’ and ‘test.’  Section 668.46 would be further amended to require an institution to include its missing person notification procedures in the annual security report.  New paragraph (h) would be added to explain the required elements in a statement of policy regarding missing person notification procedures, including the option of students in on-campus housing to identify a contact person in the case that they are determined missing, contact information for reporting a missing person, and notification procedures.

**Tentative Agreement:**

**Regulatory Language:**

§668.41 Reporting and disclosure of information.

*(a)*Definitions*.*The following definitions apply to this subpart:

* * *

*Student Housing Facility:*A**dormitory or other residential facility for students.

* * * * *

§668.46 Institutional security policies and crime statistics

(a)**Additional definitions that apply to this section*.*

* * *

*Test:*Regularly scheduled drills, exercises, and appropriate follow-through activities, designed for assessment and evaluation of emergency plans and capabilities.

* * *

(b)  Annual security report*.*An institution must prepare an annual security report that contains, at a minimum, the following information:

* * *

(13) Beginning with the annual security report distributed by October 1, 2010, a statement of policy regarding emergency response and evacuation procedures, as described in paragraph (g); and

(14) Beginning with the annual security report distributed by October 1, 2010, a statement of policy regarding missing person notification procedures, as described in paragraph (h).

* * *

(h) *Missing person notification policies and procedures.*

(1) An institution that provides any on-campus student housing facility must include a statement of policy regarding missing student notification procedures in its annual security report.  This statement must:

(i) Indicate the person or organization to which students and employees should report that a student has been missing for 24 hours; 

(ii) Require that any official missing person report must be referred immediately to the institution’s police or campus security department, or, in the absence of a sworn law enforcement officer, to the local law enforcement agency that has jurisdiction in the area;

(iii) Contain an option for each student living in an on-campus student housing facility to identify a contact person or persons whom the institution shall notify if the student is determined missing by the campus security or police department, or the local law enforcement agency.  

(iv) Advise students that their contact information will be registered confidentially.

(v) Advise students that if they are under 18 years of age and not emancipated, the institution must notify a custodial parent or guardian when the student is missing, and.

(vi) Advise students that, regardless of whether they name a contact person, unless the local law enforcement agency was the entity that made the determination that a student is missing, the institution will notify the local law enforcement agency that the student is missing.

(2) The procedures that the institution will follow when a student is determined to have been missing for 24 hours include—

(i) If the student has designated a contact person, the institution will notify that contact person within 24 hours. 

(ii) If the student is under 18 years of age and is not emancipated, the institution will notify the student’s custodial parent or guardian within 24 hours.

(iii) Regardless of whether the student has identified a contact person, is above the age of 18, or is an emancipated minor, the institution will inform the local law enforcement agency that has jurisdiction in the area within 24 hours. 

**Statutory Language:**

**(j)**MISSING PERSON PROCEDURES.—

**(1)**OPTION AND PROCEDURES.—Each institution of higher education that provides on-campus housing and participates in any program under this title shall—

**(A)**establish a missing student notification policy for students who reside in on-campus housing that—

**(i)**informs each such student that such student has the option to identify an individual to be contacted by the institution not later than 24 hours after the time that the student is determined missing in accordance with official notification procedures established by the institution under subparagraph (B);

**(ii)**provides each such student a means to register confidential contact information in the event that the student is determined to be missing for a period of more than 24 hours;

**(iii)**advises each such student who is under 18 years of age, and not an emancipated individual, that the institution is required to notify a custodial parent or guardian not later 24 hours after the time that the student is determined to be missing in accordance with such procedures;

**(iv)**informs each such residing student that the institution will notify the appropriate law enforcement agency not later than 24 hours after the time that the student is determined missing in accordance with such procedures; and

**(v)**requires, if the campus security or law enforcement personnel has been notified and makes a determination that a student who is the subject of a missing person report has been missing for more than 24 hours and has not returned to the campus, the institution to initiate the emergency contact procedures in accordance with the student’s designation; and

**(B)**establish official notification procedures for a missing student who resides in on-campus housing that—

**(i)**includes procedures for official notification of appropriate individuals at the institution that such student has been missing for more than 24 hours;

**(ii)**requires any official missing person report relating to such student be referred immediately to the institution’s police or campus security department; and

**(iii)**if, on investigation of the official report, such department determines that the missing student has been missing for more than 24 hours, requires—

**(I)**such department to contact the individual identified by such student under subparagraph (A)(i);

**(II)**if such student is under 18 years of age, and not an emancipated individual, the institution to immediately contact the custodial parent or legal guardian of such student; and

**(III)**if subclauses (I) or (II) do not apply to a student determined to be a missing person, inform the appropriate law enforcement agency.

**(2)**RULE OF CONSTRUCTION.—Nothing in this subsection shall be construed—

**(A)**to provide a private right of action to any person to enforce any provision of this subsection; or

**(B)**to create a cause of action against any institution of higher education or any employee of the institution for any civil liability.

###### Issue Paper # 13

**Origin:**HEOA

**Issue:**Hate Crime Reporting

**Statutory cites:**Section 485(f) of the HEA

**Regulatory cites:**§668.46(c)(3)

**DCL GEN-08-12 cite:**Page 98

**Summary of issue:**The HEOA expands the list of crimes that institutions must include in hate crime statistics reported to the Department.

Under the HEA, institutions are required to report statistics on criminal offenses occurring on campus, in or on noncampus buildings or property, and on public property during the most recent calendar year, and during the 2 preceding calendar years for which data are available.  Section 485(f)(1)(F)(i) currently lists the crimes that must be reported, including:

· Murder; 

· Sex offenses, forcible or nonforcible;

· Robbery;

· Aggravated assault;

· Burglary;

· Motor vehicle theft;

· Manslaughter; 

· Arson; and

· Arrests or persons referred for campus disciplinary action for liquor law violations, drug-related violations, and weapons possession.

Additionally, §485(f)(1)(F)(ii) requires institutions to report hate crimes, or crimes that are perpetrated against a victim intentionally because of the actual or perceived race, gender, religion, sexual orientation, ethnicity, or disability of the victim.  HEOA section 488(e) requires institutions to report hate crime statistics that include, in addition to the types of crimes listed above, larceny-theft, simple assault, intimidation, and destruction, damage, or vandalism of property, as well as other crimes involving bodily injury to any person.

**Updated Information since 3/2-4 meetings:** The additional crimes would be added to §668.46(c)(3) and the definitions in the Appendix A to Subpart D of part 668 – Crime Definitions in Accordance with the Federal Bureau of Investigation’s Uniform Crime Reporting Program.  The definitions will follow those in the FBI Hate Crime Data Collection Guidelines.

**Tentative agreement:**

**Regulatory Language:**

(c)(3)  *Reported crimes if a hate crime.*An institution must report, by category of prejudice, the following crimes reported to local police agencies or to a campus security authority that manifest evidence that the victim was intentionally selected because of the victim’s actual or perceived race, gender, religion, sexual orientation, ethnicity, or disability:

(i) Any crime it reports pursuant to paragraphs (c)(1)(i) through (vii) of this section;

(ii) The crimes of larceny-theft, simple assault, intimidation, and destruction, damage, or vandalism of property; and

(iii) Any other crime involving bodily injury. 

* * * * *

Appendix A to Subpart D of part 668 – Crime Definitions in Accordance with the Federal Bureau of Investigation’s Uniform Crime Reporting Program

*Larceny-theft (except motor vehicle theft)*

The unlawful taking, carrying, leading, or riding away of property from the possession or constructive possession of another.  Attempted larcenies are included.

*Simple assault*

An unlawful physical attack by one person upon another where neither the offender displays a weapon, nor the victim suffers obvious severe or aggravated bodily injury involving apparent broken bones, loss of teeth, possible internal injury, severe laceration, or loss of consciousness.

*Intimidation*

To unlawfully place another person in reasonable fear of bodily harm through the use of threatening words and/or other conduct, but without displaying a weapon or subjecting the victim to actual physical attack.

*Destruction, Damage, or Vandalism of Property*

To willfully or maliciously destroy, damage, deface, or otherwise injure real or personal property without the consent of the owner or the person having custody or control of it.

**Statutory Language:**

**(f)**DISCLOSURE OF CAMPUS SECURITY POLICY AND CAMPUS CRIME STATISTICS.—**(1)**Each eligible institution participating in any program under this title, other than a foreign institution higher education shall on August 1, 1991, begin to collect the following information with respect to campus crime statistics and campus security policies of that institution, and beginning September 1, 1992, and each year thereafter, prepare, publish, and distribute, through appropriate publications or mailings, to all current students and employees, and to any applicant for enrollment or employment upon request, an annual security report containing at least the following information with respect to the campus security policies and campus crime statistics of that institution:

* * * * *

**(F)**Statistics concerning the occurrence on campus, in or on noncampus buildings or property, and on public property during the most recent calendar year, and during the 2 preceding calendar years for which data are available—

**(i)**of the following criminal offenses reported to campus security authorities or local police agencies:

**(I)**murder;

**(II)**sex offenses, forcible or nonforcible;

**(III)**robbery;

**(IV)**aggravated assault;

**(V)**burglary;

**(VI)**motor vehicle theft;

**(VII)**manslaughter;

**(VIII)**arson; and

**(IX)**arrests or persons referred for campus disciplinary action for liquor law violations, drug-related violations, and weapons possession; and

**(ii)**of the crimes described in subclauses (I) through (VIII) of clause (i), of larceny-theft, simple assault, intimidation, and destruction, damage, or vandalism of property, and of other crimes involving bodily injury to any person, in which the victim is intentionally selected because of the actual or perceived race, gender, religion, sexual orientation, ethnicity, or disability of the victim that are reported to campus security authorities or local police agencies, which data shall be collected and reported according to category of prejudice.

###### Issue Paper # 14

**Origin:**HEOA

**Issue:**Reporting Emergency Response and Evacuation Procedures

**Statutory cites:**Section 485(f) of the HEA

**Regulatory cites:**§668.46(a), §668.46(b)(13), §668.46(e), and §668.46(g)

**DCL GEN-08-12 cite:**Page 98

**Summary of issue:**The HEOA expands the list of information that institutions are required to include in the annual security report.  Under section 485(f)(J) of the HEA, institutions must include a statement of emergency response and evacuation procedures, describing how the institution will immediately notify the campus community upon the confirmation of a significant emergency or dangerous situation involving an immediate threat to the health or safety of students or staff occurring on the campus, unless the notification will compromise efforts to contain the emergency.  

“Campus” is defined in 34 C.F.R. §668.46 as:

· Any building or property owned or controlled by an institution within the same reasonably contiguous area and used by the institution in direct support of, or in a manner related to, the institution’s educational purposes, including residence halls; and

· Any building or property that is within or reasonably contiguous to the area identified above that is owned by the institution but controlled by another person, is frequently used by students, and supports institutional purposes (such as a food or other retail vendor).

Institutions are required to both publicize the emergency response and evacuation procedures to students and staff, and test the emergency response and evacuation procedures on an annual basis.

**Updated information since 3/2-4 meetings**: To implement the requirements in 485(f) of the HEA, §668.46(a) would be amended to include the definition of a ‘test,’ and §668.46(b) would be amended to require an institution to include a statement of policy regarding emergency response and evacuation procedures in its annual security report.  Section 668.46(e) would be amended to clarify that the emergency notification provisions are separate from the timely warning provisions.   New paragraph (g) would be added to §668.46 that outlines the required elements in this statement of policy, including (1) procedures to immediately notify the campus community in the case of an emergency, (2) the officials responsible for specific duties in the case of an emergency, (3) plans to train relevant officials, (4) procedures to notify parents, and (5) plans to test the policy and procedures.

**Tentative agreement:**

**Regulatory language:**

§668.46 Institutional security policies and crime statistics

(a) *Additional definitions that apply to this section.*

** * **

Test:  Regularly scheduled drills, exercises, and appropriate follow-through activities, designed for assessment and evaluation of emergency plans and capabilities.

* * * * *

(b)  *Annual security report.*An institution must prepare an annual security report that contains, at a minimum, the following information:

* * *

(13) Beginning with the annual security report distributed by October 1, 2010, a statement of policy regarding emergency response and evacuation procedures, as described in paragraph (g) of this section; and

(14) Beginning with the annual security report distributed by October 1, 2010, a statement of policy regarding missing person notification procedures, as described in paragraph (h) of this section.

* * *

(e) *Timely warning.*(1) An institution must, in a manner that is timely and will aid in the prevention of similar crimes, report to the campus community on crimes that are –

(i) Described in paragraph (c)(1) and (3) of this section;

(ii) Reported to campus security authorities as identified under the institution’s statement of current campus policies pursuant to paragraph (b)(2) of this section or local police agencies; and

(iii) Considered by the institution to represent a threat to students and employees.

(2) An institution is not required to provide a timely warning with respect to crimes reported to a pastoral or professional counselor.

(3) The timely warning requirement does not apply in the circumstances covered under paragraph (g) of this section.  In the case that there is an immediate threat to the health or safety of students or employees occurring on campus, as described in paragraph (g)(1) of this section, an institution’s emergency notification procedures will supplant a timely warning communication.

* * * 

(g) *Emergency Response and Evacuation Procedures*.  An institution must include a statement of policy regarding its emergency response and evacuation procedures in the annual security report.  This statement must include --

(1)  Procedures to immediately notify the campus community upon the confirmation of a significant emergency or dangerous situation involving an immediate threat to the health or safety of students or employees occurring on the campus.  

(2)  The positions of the individuals who will--

(i)  Confirm that there is a significant emergency or dangerous situation as described in (g)(1) of this paragraph;

(ii) Determine the content of the notification;

(iii) Determine when to send the notification; and

(iv) Initiate the notification system.

(3) Plans to ensure that the officials in (g)(2) of this paragraph are appropriately trained to carry out these duties.

(4) Procedures to notify parents and families in an emergency situation and provide accurate, timely information.

(5) Plans to conduct a test of the emergency response and evacuation procedures on at least an annual basis.

(i) A test may be announced or unannounced, but it must be conducted at a time when most of the students, faculty, and staff are expected to be present on campus.

(ii)  An institution must document each test, including the date, time, and whether it was announced or unannounced. 

**Statutory Language:**

**(f)**DISCLOSURE OF CAMPUS SECURITY POLICY AND CAMPUS CRIME STATISTICS.—**(1)**Each eligible institution participating in any program under this title, other than a foreign institution higher education shall on August 1, 1991, begin to collect the following information with respect to campus crime statistics and campus security policies of that institution, and beginning September 1, 1992, and each year thereafter, prepare, publish, and distribute, through appropriate publications or mailings, to all current students and employees, and to any applicant for enrollment or employment upon request, an annual security report containing at least the following information with respect to the campus security policies and campus crime statistics of that institution:

* * * * *

**(J)**A statement of current campus policies regarding immediate emergency response and evacuation procedures, including the use of electronic and cellular communication (if appropriate), which policies shall include procedures to—

**(i)**immediately notify the campus community upon the confirmation of a significant emergency or dangerous situation involving an immediate threat to the health or safety of students or staff occurring on the campus, as defined in paragraph (6), unless issuing a notification will compromise efforts to contain the emergency;

**(ii)**publicize emergency response and evacuation procedures on an annual basis in a manner designed to reach students and staff; and

**(iii)**test emergency response and evacuation procedures on an annual basis.

**Issue Paper #15**

**Origin:**HEOA

**Issue:**Financial Assistance for individuals with intellectual disabilities

**Statutory cites:**Sections 484(s) and 760 of the HEA

**Regulatory cites:**§600.2, §600.4, §600.5, 600.6, §668.8, §600.32, §668.43, §668 new subpart O

**DCL GEN-08-12 cite:**Pages 94-95, 163-164

**Summary of issue:**The HEOA adds a provision to the HEA to expand eligibility for funding under the Federal Pell Grant, FSEOG, and FWS programs to students with intellectual disabilities.  

As defined in §760 of the HEA, a student with an intellectual disability is a student with mental retardation or a cognitive impairment, characterized by significant limitations in intellectual and cognitive functioning and adaptive behavior, as expressed in conceptual, social and practical adaptive skills.  Further, such a student is currently, or was formerly, eligible for a free appropriate public education under the Intellectual with Disabilities Education Act.  

Under section 484(s) of the HEA, a student with an intellectual disability may receive Federal financial assistance to attend a comprehensive transition and postsecondary program for students with intellectual disabilities (defined in section 760 of the HEA).  Such a program is a degree, certificate, or non-degree program that:

· Is offered by an institution of higher education;

· Is designed to support students with intellectual disabilities who seek to continue academic, career and technical, and independent living instruction to prepare for gainful employment;

· Includes an advising and curriculum structure; 

· Requires attendees to participate on at least a half-time basis, as determined by the institution; and

· Focuses on academic components, which may occur through one or more of the following activities:

· Regular enrollment in credit-bearing courses with nondisabled students offered by the institution;

· Auditing or participation in courses with nondisabled students offered by the institution for which the student does not receive regular academic credit;

· Enrollment in noncredit-bearing, nondegree courses with nondisabled students; or

· Participation in internships or work-based trainings in settings with nondisabled students.

The HEA now specifies that the eligibility requirements for financial assistance under the Pell, FSEOG, and FWS programs for a student with an intellectual disability differ from the eligibility requirements for a student who does not have an intellectual disability.  In particular, the provision that a student achieve satisfactory progress under §484(a) and 484(c) of the HEA, and the provision that a student demonstrate the ability to benefit, under §484(d)(1), (2), (3), and (4) are not applicable in new §485(s).  To be eligible for financial assistance, a student with an intellectual disability must:

· Be enrolled or accepted for enrollment in a comprehensive transition and postsecondary program for students with intellectual disabilities at an institution of higher education;

· Be maintaining satisfactory progress, as determined by the institution; and

●Meet the student eligibility requirements in §§484(a)(3), (4), (5), and (6).  Under these provisions, a student must not be in default on any Federal student loans, must have filed a FAFSA form, must be a United States citizen or national, and, if the student was convicted of fraud in obtaining funds under this title, must have completed the repayment of such funds.

With the exception of provisions surrounding Need Analysis, the Secretary may waive any statutory provisions governing the Pell Grant, FSEOG, and FWS programs, and any institutional eligibility provisions to ensure that eligible students and such comprehensive transition and postsecondary programs for students with intellectual disabilities remain eligible for Title IV program funds.

**Updated information since 3/2-4 meetings:**Section 600.2 would be amended to include a comprehensive transition and postsecondary program that does not lead to an academic, professional, vocational degree, a certificate, or another recognized educational credential  in the definition of an educational program.  Sections 600.4, 600.5, 600.6 related to institutional eligibility would be amended to ensure that an institution will still be an eligible institution of higher education for the purposes of title IV, HEA programs if it offers a comprehensive transition and postsecondary program.  Sections 668.8 and 668.32 would be amended to direct the reader to new subpart O of part 668 for the requirements for program and student eligibility for a comprehensive transition and postsecondary program for students with intellectual disabilities.  Section 668.43 would be updated to ensure that institutions include any facilities and services for students with intellectual disabilities in its description of available facilities and services for disabled students.

A new subpart O in part 668 would be added to implement the provisions in 484(s) and 760 of the HEA.  The new sections will describe the scope and purpose of the sections; define the applicable terms, including ‘comprehensive transition and postsecondary program,’ ‘free appropriate public education,’ and ‘student with an intellectual disability;’ and describe the requirements for program and student eligibility.  The new section would include waivers that ensure that these students remain eligible for funding under only the Federal Pell Grant, FSEOG, and Federal-Work Study programs, including that a student does not need to have a high school diploma or have passed an ability-to-benefit test and does not need to be enrolled for the purpose of obtaining a degree or certificate. 

**Tentative Agreement:**

**Regulatory Language:**

§600.2 Definitions.

* * * * *

*Educational program*: (1) A legally authorized postsecondary program of organized instruction or study that:

(1) Leads to an academic, professional, or vocational degree, or certificate, or other recognized educational credential, or is a comprehensive transition and postsecondary program, as described in subpart O of part 668; and

(2) May, in lieu of credit hours or clock hours as a measure of student learning, utilize direct assessment of student learning, or recognize the direct assessment of student learning by others, if such assessment is consistent with the accreditation of the institution or program utilizing the results of the assessment and with the provisions of §668,10.

* * * * *

§600.4 Institution of higher education.

* * *

(a)(4)(ii) That is at least a two-academic-year program acceptable for full credit toward a baccalaureate degree; or

(a)(4)(iii) That is at least a one-academic-year training program that leads to a certificate, degree, or other recognized educational credential and prepares students for gainful employment in a recognized occupation; ~~and~~

* * *

(a)(5) (ii) Approved by a State agency listed in the FEDERAL REGISTER in accordance with 34 CFR part 603, if the institution is a public postsecondary vocational educational institution that seeks to participate only in Federal assistance programs; and~~.~~

(6) May admit students with intellectual disabilities to a comprehensive transition and postsecondary program, as provided in subpart O of part 668.

* * * * *

§600.5 Proprietary institution of higher education.

* * *

(a)(5) Provides an eligible program of training, as defined in 34 CFR 668.8, to prepare students for gainful employment in a recognized occupation; 

* * *

(a)(7) Has been in existence for at least two years; ~~and~~

(8) Has no more than 90 percent of its revenues derived from title IV, HEA program funds, as determined under paragraph (d) of this section; and~~.~~

(9) May admit students with intellectual disabilities to a comprehensive transition and postsecondary program, as provided in subpart O of part 668. 

* * * * *

§600.6 Postsecondary vocational institution.

* * *

(a)(4) Provides an eligible program of training, as defined in 34 CFR 668.8, to prepare students for gainful employment in a recognized occupation; 

(a)(5)(ii) Approved by a State agency listed in the FEDERAL REGISTER in accordance with 34 CFR part 603, if the institution is a public postsecondary vocational educational institution that seeks to participate only in Federal assistance programs;~~and~~

(6) Has been in existence for at least two years; and~~.~~

(7) May admit students with intellectual disabilities to a comprehensive transition and postsecondary program, as provided in subpart O of part 668.

* * * * *

§668.8 Eligible program.

***

(n) For title IV, HEA program purposes, the term *eligible program* includes a direct assessment program approved by the Secretary under 34 CFR 668.10 and a comprehensive transition and postsecondary program approved by the Secretary under 34 CFR 668.232.

§668.32 Student Eligibility – general.

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A student is eligible to receive title IV, HEA program assistance if the student –
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(a)(1)(i) Except as provided in paragraph (n), is a regular student enrolled, or accepted for enrollment, in an eligible program at an eligible institution;
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*
*
*
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(k) *
*
*
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(9) 34 CFR 686.22 for the TEACH Grant program; ~~and~~
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(l) Is not ineligible under §668.40; ~~and~~
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(m) In the case of a student who has been convicted of, or has pled nolo contender or guilty to, a crime involving fraud in obtaining title IV, HEA program assistance, has completed the repayment of such assistance to:
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(1) The Secretary; or
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(2) The holder, in the case of a title IV, HEA program loan~~.~~; and
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(n) Is enrolled in a comprehensive transition and postsecondary program under subpart O of this part and meets the student eligibility criteria in that subpart.
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* * * * *
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§668.43 Institutional information.
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* * *
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(a)(7) A description of the services and facilities ~~any special facilities and services~~ available to students with disabilities~~disabled students~~, including students with intellectual disabilities as defined in Subpart O of this part;
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* * * * *
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**§668 Subpart O – Financial Assistance for Students with**

**Intellectual Disabilities**

§668.230 Scope and purpose**.**

This subpart establishes rules that apply to an institution that offers comprehensive transition and postsecondary programs to students with intellectual disabilities.  Students enrolled in these programs are eligible for Federal financial assistance under the Federal Pell, FSEOG, and Federal Work Study programs.  Except for provisions related to needs analysis, the Secretary may waive any title IV, HEA program requirement related to the Federal Pell Grant, FSEOG, and FWS programs or institutional eligibility, to ensure that students with intellectual disabilities remain eligible for funds under these assistance programs.  However, unless provided in this subpart or subsequently waived by the Secretary, students with intellectual disabilities and institutions that offer comprehensive transition and postsecondary programs are subject to the same rules and procedures that otherwise apply to title IV, HEA program participants. 

§668.231 Definitions. 

*Comprehensive Transition and Postsecondary Program*means a degree, certificate, non-degree, or non-certificate program that-- 

(1) Is offered by a participating institution;

(2) Is delivered to students physically attending the institution;

(3) Is designed to support students with intellectual disabilities who seek to continue academic, career and technical, and independent living instruction, and to prepare students for gainful employment;

(4) Includes an advising and curriculum structure; 

(5) Requires students with intellectual disabilities to be enrolled on at least a half-time basis, as determined by the institution; and

(6) Requires students with intellectual disabilities to be engaged academically by-- 

(i) Taking credit-bearing courses with students without disabilities;

(ii) Auditing or otherwise participating in courses with students without disabilities for which the student does not receive regular academic credit;

(iii) Taking noncredit-bearing, nondegree courses with nondisabled students; or

(iv) Participating in internships or work-based training in settings with individuals without disabilities.

*Free Appropriate Public Education*(FAPE) is defined in 34 CFR 300.17. 

*Student with an Intellectual Disability* means a student –

(1)  With mental retardation or a cognitive impairment characterized by significant limitations in-- 

(i) Intellectual and cognitive functioning, and

(ii) Adaptive behavior as expressed in conceptual, social, and practical adaptive skills; and

(2)  Who is currently, or was formerly, eligible for a free appropriate public education under the Individuals with Disabilities Education Act (20 U.S.C. 1401), including a student who was home-schooled or attended private school.

# §668.232 Program eligibility.

An institution that offers a comprehensive transition and postsecondary program must apply to the Secretary to have the program determined to be an eligible program.  The institution applies under the provisions for adding an educational program in 34 CFR 600.20, and must include in its application--

(a) A description of the comprehensive transition and postsecondary program that addresses all of the components of the program, as defined in §668.231;

(b) Its policy for determining whether a student enrolled in the program is making satisfactory academic progress;

(c) The number of weeks of instructional time, the number of semester or quarter credit hours, clock hours, or, in the case of a non-credit or reduced credit course, the equivalent credit hours in the program, and the number of those hours needed to be a full-time and half-time student;

(d) A description of the educational credential offered (degree or certificate) or outcome expected of students enrolled in the program;

(e) A copy of the letter or notice sent to the institution’s accrediting agency informing the agency of its comprehensive transition and postsecondary program.  The letter or notice must include a description of how the institution will evaluate the program based on the standards established by the institution for success with respect to student achievement; and

(f) Any other information the Secretary may require.

§668.233 Student eligibility.

A student with an intellectual disability is eligible to receive Federal Pell, FSEOG, and Federal Work Study program assistance under this subpart if—

(a) The student satisfies the general student eligibility requirements under §668.32, except for the requirements in paragraphs (a), (e), and (f) of that section.  With regard to these exceptions, a student--

(1) Does not have to be enrolled for the purpose of obtaining a degree or certificate; 

(2) Is not required to have a high school diploma, a recognized equivalent of a high school diploma, or have passed an ability to benefit test; and 

(3) Is making satisfactory progress according to the institution’s published standards for students enrolled in its comprehensive transition and postsecondary programs; 

(b) The student is enrolled on at least a half-time basis, as determined by the institution, in a comprehensive transition and postsecondary program approved by the Secretary; and

(c) The institution obtains documentation establishing that the student has an intellectual disability.  Acceptable documentation includes--

(1) A documented comprehensive and individualized psycho-educational evaluation and diagnosis by a psychologist or other qualified professional;

(2) A record of the disability from a local educational agency that describes the eligibility of the student to receive services through the Individuals with Disabilities Education Act, or

(3) A record of the disability from a government agency, such as a vocational rehabilitation agency, that describes the abilities and limitations of the student.

**Statutory Language:**

# HEA section 484

**(s)**STUDENTS WITH INTELLECTUAL DISABILITIES.—

**(1)**DEFINITIONS.—In this subsection the terms ‘comprehensive transition and postsecondary program for students with intellectual disabilities’ and ‘student with an intellectual disability’ have the meanings given the terms in section 760.

**(2)**REQUIREMENTS.—Notwithstanding subsections (a), (c), and (d), in order to receive any grant or work assistance under section 401, subpart 3 of part A, or part C, a student with an intellectual disability shall—

**(A)**be enrolled or accepted for enrollment in a comprehensive transition and postsecondary program for students with intellectual disabilities at an institution of higher education;

**(B)**be maintaining satisfactory progress in the program as determined by the institution, in accordance with standards established by the institution; and

**(C)**meet the requirements of paragraphs (3), (4), (5), and (6) of subsection (a).

**(3)**AUTHORITY.—Notwithstanding any other provision of law unless such provision is enacted with specific reference to this section, the Secretary is authorized to waive any statutory provision applicable to the student financial assistance programs under section 401, subpart 3 of part A, or part C (other than a provision of part F related to such a program), or any institutional eligibility provisions of this title, as the Secretary determines necessary to ensure that programs enrolling students with intellectual disabilities otherwise determined to be eligible under this subsection may receive such financial assistance.

**(4)**REGULATIONS.—Notwithstanding regulations applicable to grant or work assistance awards made under section 401, subpart 3 of part A, and part C (other than a regulation under part F related to such an award), including with respect to eligible programs, instructional time, credit status, and enrollment status as described in section 481, the Secretary shall promulgate regulations allowing programs enrolling students with intellectual disabilities otherwise determined to be eligible under this subsection to receive such awards.

## HEA Section 760

In this part:

1) COMPREHENSIVE TRANSITION AND POSTSECONDARY PROGRAM FOR STUDENTS WITH INTELLECTUAL DISABILITIES. – The term ‘comprehensive transition and postsecondary program for students with intellectual disabilities’ means a degree, certificate, or nondegree program that is--

**(A)**offered by an institution of higher education;

**(B)**designed to support students with intellectual disabilities who are seeking to continue academic, career, and technical, and independent living instruction at an institution of higher education in order to prepare for gainful employment;

**(C)**includes an advising and curriculum structure; and

**(D)**requires students with intellectual disabilities to participate on not less than a half-time basis, as determined by the institution, with such participation focusing on academic components and occurring through one or more of the following activities:

**(i)** Regular enrollment in credit-bearing courses with nondisabled students offered by the institution;

**(ii)** Auditing or participating in courses with non-disabled students offered by the institution for which the student does not receive regular academic credit;

**(iii)** Enrollment in noncredit-bearing, nondegree courses with nondisabled students;

**(iv)** Participation in internships or work-based training in settings with nondisabled students.

**(2)** STUDENT WITH AN INTELLECTUAL DISABILITY. – The term ‘student with an intellectual disability’ means a student –

**(A)** with mental retardation or a cognitive impairment, characterized by significant limitations in--

**(i)** intellectual and cognitive functioning; and

**(ii)** adaptive behavior as expressed in conceptual, social, and practical adaptive skills; and

**(B)** who is currently, or was formerly, eligible for a free appropriate public education under the Individuals with Disabilities Education Act.

**Issue Paper #16**

**Origin:**HEOA

**Issue:**Readmission requirements for servicemembers

**Statutory cites:**Section 484C of the HEA

**Regulatory cites:**New §668.18

**DCL GEN-08-12 cite:**Pages 63-65

**Summary of issue:**Effective August 14, 2008, an institution may not deny readmission to a servicemember of the uniformed services for reasons relating to that service.  In addition, a student who is readmitted to an institution under this section must be readmitted with the same academic status as the student had when he or she last attended the institution.  An affected servicemember is any individual who is a member of, applies to be a member of, or performs, has performed, applies to perform, or has the obligation to perform, service in the uniformed services.  This applies to service in the uniformed services, whether voluntary or involuntary, on active duty in the Armed Forces, including service as a member of the National Guard or Reserve, for a period of more than 30 days under a call or order to active duty of more than 30 days. 

Any student whose absence from an institution of higher education is necessitated by reason of service in the uniformed services is entitled to readmission if

· the student (or an appropriate officer of the Armed Forces or official of the Department of Defense) gives advance written or verbal notice of such service to the appropriate official at the institution;

· the cumulative length of the absence and of all previous absences from that institution of higher education by reason of service in the uniformed services does not exceed five years; and

· except as otherwise provided in this section, the student submits a notification of intent to reenroll in the institution.

However, no advance notice by the student is required if the giving of such notice is precluded by military necessity, such as a mission, operation, exercise, or requirement that is classified; or a pending or ongoing mission, operation, exercise, or requirement that may be compromised or otherwise adversely affected by public knowledge.  In addition, any student (or an appropriate officer of the Armed Forces or official of the Department of Defense) who did not give advance notice of service to the appropriate official at the institution may meet the notice requirement by submitting, at the time the student seeks readmission, an attestation to the student’s institution that the student performed service in the uniformed services that necessitated the student’s absence from the institution.

When determining the cumulative length of the student’s absence for service, the period of service does not include any service

· that is required, beyond five years, to complete an initial period of obligated service;

· during which the student was unable to obtain orders releasing the student from a period of service in the uniformed services before the expiration of the five-year period and the inability to obtain those orders was through no fault of the student; or

· performed by a member of the Armed Forces (including the National Guard and Reserves) who is

· ordered to or retained on active duty under section 688, 12301(a), 12301(g), 12302, 12304, or 12305 of Title 10, U.S.C., or under section 331, 332, 359, 360, 367, or 712 of Title 14, U.S.C.;

· ordered to or retained on active duty (other than for training) under any provision of law because of a war or national emergency declared by the President or the Congress;

· ordered to active duty (other than for training) in support of an operational mission for which personnel have been ordered to active duty under section 12304 of Title 10, U.S.C.;

· ordered to active duty in support of a critical mission or requirement of the Armed Forces (including the National Guard or Reserve); or

· called into Federal service as a member of the National Guard under chapter 15 of Title 10, U.S.C., or section 12406 of Title 10, U.S.C.

An affected servicemember must, upon the completion of a period of service in the uniformed services, notify the institution of his or her intent to return to the institution not later than three years after the completion of the period of service.  However, a student who is hospitalized for or convalescing from an illness or injury incurred in or aggravated during the performance of service in the uniformed services must notify the institution of his or her intent to return to the institution not later than two years after the end of the period that is necessary for recovery from such illness or injury.  A student who fails to apply for readmission within the required period does not automatically forfeit eligibility for readmission to the institution, but is subject to the institution’s established leave of absence policy and general practices.

A student who submits an application for readmission to an institution must provide to the institution documentation to establish that

· the student has not exceeded the specified service limitations; and

· the student’s eligibility for readmission has not been terminated.

An institution may not delay or attempt to avoid a readmission of a student under this section by demanding documentation that does not exist, or is not readily available, at the time of readmission.

A student’s eligibility for readmission to an institution under this section by reason of such student’s service in the uniformed services terminates upon the occurrence of any of the following events:

· a separation of such person from the Armed Forces (including the National Guard and reserves) with a dishonorable or bad conduct discharge;

· a dismissal of such person permitted under section 1161(a) of Title 10, U.S.C.; or

· a dropping of such person from the rolls pursuant to section 1161(b) of Title 10, U.S.C.

These provisions were based on the provisions of the Uniformed Services Employment and Reemployment Rights Act (USERRA).

Title 10 of the U.S.C. can be accessed at

http://www.access.gpo.gov/uscode/title10/title10.html

Title 14 of the U.S.C. can be accessed at

http://www.access.gpo.gov/uscode/title14/title14.html

Note:  The HEOA also added a provision to the HEA at section 131(f) which, effective August 14, 2009, requires the Secretary to coordinate with the Secretary of Defense and the Secretary of Veterans Affairs to create a searchable website within the Federal student financial aid website that, in addition to containing information about all Federal and State student financial assistance, must contain information about the readmission requirements under section 484C of the HEA and other student services for which members of the Armed Forces may be eligible.  In addition, the Secretary is required to work with the Secretary of Defense and the Secretary of Veterans Affairs to make the availability of the Armed Forces information website widely known to members of the Armed Forces, institutions of higher education, and the general public.  The Department does not plan to expand on this provision in regulations and, therefore, has not included it as a provision that will be negotiated.

**Updated information since 3/2-4 meetings:**

*General*

Section 668.18(a) would include the general requirements of the statute that an institution may not deny readmission to a servicemember, but must readmit the servicemember with the same academic status as the student had when the student was last admitted to the institution.  The regulations would specify that the institution must admit the student promptly, and define what it means to “promptly readmit” a student.  Section 668.18(a) would also specify what it means to readmit a person with the same academic status.

In the case of a student who is not prepared to resume the program at the point where he or she left off, §668.18(a) would require the institution to make reasonable efforts to help the student become prepared including, but not limited to, providing refresher courses at no extra cost.  The institution would not be required to readmit the student if, after reasonable efforts by the institution, the student is still not prepared to resume the program at the point where he or she left off.

Section 668.18(a) would clarify that the requirements of this section apply to an institution even if that institution has undergone a change of ownership since the student ceased attendance.

Finally, §668.18(a) would make clear that the provisions of this section supersede any State law or other requirement that reduce, limit, or eliminate any right or benefit provided by this section.

*Service in the uniformed services*

Section 668.18(b) would delineate what service in the uniformed services means for purposes of this section.  This section would expand upon the statutory language to clarify that service in the uniformed services includes active duty for training and full-time National Guard duty under Federal authority (i.e, not National Guard service under authority of State law).  In addition, the regulations would specify that qualifying service must be for more than 30 *consecutive* days under a call or order to active duty of more than 30 *consecutive* days.

*Readmission procedures*

Section 668.18(c) would list the conditions under which an institution must readmit a servicemember.  The regulations would require an institution to designate one or more offices for the purpose of receiving advance notice from students of their absence from the institution necessitated by service in the uniformed services, and notice from students of an intent to return to the institution.  The regulations would make clear that advance notice must be provided by the student as far in advance as is reasonable under the circumstances.  However such notice would not need to follow any particular format, nor would a student have to indicate as part of the notice whether the student intends to return to the institution.  Also, the regulations would make clear that an institution may not set a brightline deadline for submission of any such notice, but must judge the timeliness of submission by the facts of a particular case.  As such notice may be provided by an appropriate officer of the Armed Forces, the regulations would clarify who an “appropriate officer” is.  Section 668.18(c) would also provide that a student’s notice of intent to return may be provided orally or in writing, as specified in the statute for advance notice from students of their absence from the institution necessitated by service in the uniformed services.  The notice of intent to return would not need to follow any particular format. 

*Exceptions to advance notice*

Section 668.18(d) would restate the statutory language for exceptions to advance notice.

*Cumulative length of absence*

Section 668.18(e) would list the types of service that are not included in the cumulative length of the student’s absence, including a brief description of the types of services referenced in titles 10 and 14 of the United States Code.

*Notification of Intent to Reenroll*

Section 668.18(f) would restate the statutory provision providing that a student who fails to apply for readmission within the required periods does not automatically forfeit eligibility for readmission to the institution, but is subject to the institution’s established leave of absence policy and general practices.

*Documentation*

Section 668.18(g) would list the documentation that a student must submit with an application for readmission.  The regulations would list several types of documentation that satisfy the documentation requirements, making clear that the types of documentation available or necessary will vary from case to case.

*Termination of readmission eligibility*

Section 668.18(f) would list the circumstances under which a student’s eligibility for readmission to an institution would be terminated, including a brief description of the types of circumstances referenced in title 10 of the United States Code.

**Tentative agreement:**

**Regulatory language:**

[The whole section is new.  The mark-up shows changes to/expansion on the statutory requirements of the HEOA.]

Section 668.18  Readmission requirements for servicemembers.

(a)  General.  (1)  An institution may not deny readmission to a person who is a member of, applies to be a member of, performs, has performed, applies to perform, or has an obligation to perform, service in the uniformed services on the basis of that membership, application for membership, performance of service, application for service, or obligation.

(2)(i)  An institution must promptly readmit to the institution a person described in paragraph (a)(1) of this section with the same academic status as the student had when the student last attended the institution or was last admitted to the institution, but did not begin attendance.

(ii)  “Promptly readmit” means as soon as practicable under the circumstances of each case.  Absent unusual circumstances, the individual must be readmitted into the next class or classes in the student’s program beginning after the individual provides notice of his or her intent to reenroll, unless the individual requests a later date of readmission.

(iii) To readmit a person with the same academic status means that the institution admits the student—

(A)  To the same program to which he or she was last admitted by the institution or, if that exact program is no longer offered, the program that is most similar to that program; 

(B)  At the same enrollment status that the student last held at the institution;

(C)  With the same number of completed credit hours or clock hours;

(D)  With the same student status (e.g., if the student was on probation when he or she last attended the institution, the student is readmitted in a probation status); 

(E)  With the same institutional charges that would have been charged had the student been continuously enrolled; and

(F)  With the same satisfactory academic progress status.

(iv)(A)  If institution determines that the student is not prepared to resume the program with the same academic status at the point where the student left off, the institution must make reasonable efforts to help the student become prepared including, but not limited to, providing refresher courses at no extra cost.  The institution is not required to readmit the student on his or her return from service if he or she is not, after reasonable efforts by the institution, prepared to resume the program at the point where he or she left off.

(B)(I)  “Reasonable efforts” means actions that do not place an undue hardship on the institution.

(II)  “Undue hardship” means an action requiring significant difficulty or expense.

(C) The institution carries the burden to prove by a preponderance of the evidence that the student is not prepared to resume the program with the same academic status at the point where the student left off, after the institution makes reasonable efforts to help the student become prepared.

(3)  This provision applies to an institution that has continued in operation since the student ceased attending, notwithstanding any changes of ownership of the institution since the student ceased attendance. 

(4)  The requirements of this section supersede any State law (including any local law or ordinance), contract, agreement, policy, plan, practice, or other matter that reduces, limits, or eliminates in any manner any right or benefit provided by this section.

(b)  Service in the uniformed services. For purposes of this section, service in the uniformed services means service, whether voluntary or involuntary, in the Armed Forces, including ~~such~~service by a member of the National Guard or Reserve, on active duty, active duty for training, or full-time National Guard duty under Federal authority, for a period of more than 30 consecutive days under a call or order to active duty of more than 30 consecutive days.

(c) Readmission procedures.  (1)  Any student whose absence from an institution is necessitated by reason of service in the uniformed services shall be entitled to readmission to the institution if—

(i) Except as provided in paragraph (d) of this section, the student (or an appropriate officer of the Armed Forces or official of the Department of Defense) gives advance oral or written ~~or verbal~~notice of such service to an office designated by the ~~appropriate official at the~~institution, providing such notice as far in advance as is reasonable under the circumstances;

(ii)  The cumulative length of the absence and of all previous absences from that institution by reason of service in the uniformed services, including only the time the student spends actually performing service in the uniformed services, does not exceed five years;

(iii)  Except as provided in paragraph (f) of this section, the student gives oral or written notice~~fies the institution~~ of his or her intent to return to an office designated by the institution—

(A)  For a student who completes a period of service in the uniformed services, not later than three years after the completion of the period of service; or

(B)  For a student who is hospitalized for or convalescing from an illness or injury incurred in or aggravated during the performance of service in the uniformed services, two years after the end of the period that is necessary for recovery from such illness or injury.

(2)(i)  An institution must designate one or more offices at the institution that a student may readily contact to provide notification of service required by paragraph (c)(1)(i) of this section and notification of intent to return required by paragraph (c)(1)(iii) of this section.

(ii)  An institution may not require that the notice provided by the student under paragraph (c)(1)(i) or (c)(1)(iii) of this section follow any particular format.

(iii)  The notice provided by the student under paragraph (c)(1)(i) of this section—

(A)  May not be subject to any brightline rule for timeliness; timeliness must be determined by the facts in any particular case; and

(B)  Does not need to indicate whether the student intends to return to the institution.

(iv)  For purposes of paragraph (c)(1)(i) of this section, an “appropriate officer” is a commissioned, warrant, or noncommissioned officer authorized to give such notice by the military service concerned. 

(d)  Exceptions to advance notice.  (1)  No notice is required under paragraph (c)(1)(i) of this section if the giving of such notice is precluded by military necessity, such as—

(i)  A mission, operation, exercise, or requirement that is classified; or

(ii)  A pending or ongoing mission, operation, exercise, or requirement that may be compromised or otherwise adversely affected by public knowledge; or

(2)  Any student (or an appropriate officer of the Armed Forces or official of the Department of Defense) who did not give advance written or verbal notice of service to the appropriate official at the institution in accordance with paragraph (c)(1) of this section may meet the notice requirement by submitting, at the time the student seeks readmission, an attestation to the institution that the student performed service in the uniformed services that necessitated the student’s absence from the institution.

(e)  Cumulative length of absence.  For purposes of paragraph (c)(1)(ii) of this section, a student’s cumulative length of absence from an institution does not include any service—

(1)  That is required, beyond five years, to complete an initial period of obligated service;

(2)  During which the student was unable to obtain orders releasing the student from a period of service in the uniformed services before the expiration of the five-year period and such inability was through no fault of the student; or

(3)  Performed by a member of the Armed Forces (including the National Guard and Reserves) who is—

(i)  Ordered to or retained on active duty under~~section 688, 12301(a), 12301(g), 12302, 12304, or 12305 of title 10, United States Code, or under section 331, 332, 359, 360, 367, or 712 of title 14, United States Code;~~--

(A) 10 U.S.C. 688 (involuntary active duty by a military retiree);

(B) 10 U.S.C. 12301(a) (involuntary active duty in wartime);

(C) 10 U.S.C. 12301(g) (retention on active duty while in captive status);

(D) 10 U.S.C. 12302 (involuntary active duty during a national emergency for up to 24 months);

(E) 10 U.S.C. 12304 (involuntary active duty for an operational mission for up to 270 days);

(F) 10 U.S.C. 12305 (involuntary retention on active duty of a critical person during time of crisis or other specific conditions);

(G) 14 U.S.C. 331 (involuntary active duty by retired Coast Guard officer);

(H) 14 U.S.C. 332 (voluntary active duty by retired Coast Guard officer);

(I) 14 U.S.C. 359 (involuntary active duty by retired Coast Guard enlisted member);

(J) 14 U.S.C. 360 (voluntary active duty by retired Coast Guard enlisted member);

(K) 14 U.S.C. 367 (involuntary retention of Coast Guard enlisted member on active duty); and

(L) 14 U.S.C. 712 (involuntary active duty by Coast Guard Reserve member for natural or man-made disasters).

(ii)  Ordered to or retained on active duty (other than for training) under any provision of law because of a war or national emergency declared by the President or the Congress, as determined by the Secretary concerned;

(iii)  Ordered to active duty (other than for training) in support, as determined by the Secretary concerned, of an operational mission for which personnel have been ordered to active duty under section 12304 of title 10, United States Code;

(iv)  Ordered to active duty in support, as determined by the Secretary concerned, of a critical mission or requirement of the Armed Forces (including the National Guard or Reserve); or

(v)  Called into Federal service as a member of the National Guard under chapter 15 of title 10, United States Code, or section 12406 of title 10, United States Code (i.e., called to respond to an invasion, danger of invasion, rebellion, danger of rebellion, insurrection, or the inability of the President with regular forces to execute the laws of the United States).  

(f)  Notification of intent to reenroll.  A student who fails to apply for readmission within the periods described in paragraph (c)(1)(iii) of this section does not automatically forfeit eligibility for readmission to the institution, but is subject to the institution’s established leave of absence policy and general practices.

(g)  Documentation.  (1)  A student who submits an application for readmission to an institution under paragraph (c)(1)(iii) of this section shall provide to the institution documentation to establish that—

(i)  The student has not exceeded the service limitation in paragraph (c)(1)(ii) of this section; and

(ii)  The student’s eligibility for readmission has not been terminated due to an exception in paragraph (h) of this section. 

(2)(i) Documents that satisfy the requirements of paragraph (g)(1) of this section include, but are not limited to, the following:

(A) DD (Department of Defense) 214 Certificate of Release or Discharge from Active Duty;

(B) Copy of duty orders prepared by the facility where the orders were fulfilled carrying an endorsement indicating completion of the described service;

(C) Letter from the commanding officer of a Personnel Support Activity or someone of comparable authority;

(D) Certificate of completion from military training school;

(E) Discharge certificate showing character of service;

(F) Copy of extracts from payroll documents showing periods of service; and

(G) Letter from National Disaster Medical System (NDMS) Team Leader or Administrative Officer verifying dates and times of NDMS training or Federal activation.

(ii) The types of documents that are necessary to establish eligibility for readmission will vary from case to case. Not all of these documents are available or necessary in every instance to establish readmission eligibility.

(3)  An institution may not delay or attempt to avoid a readmission of a student under this section    by demanding documentation that does not exist, or is not readily available, at the time of readmission.

(h)  Termination of readmission eligibility.  A student’s eligibility for readmission to an institution under this section by reason of such student’s service in the uniformed services terminates upon the occurrence of any of the following events—

(1)  A separation of such person from the Armed Forces (including the National Guard and Reserves) with a dishonorable or bad conduct discharge;

(2)  A dismissal of~~such person~~a commissioned officer permitted under section 1161(a) of title 10, United States Code by sentence of a general court-martial; in commutation of a sentence of a general court-martial; or, in time of war, by order of the President; or

(3)  A dropping of ~~such person~~a commissioned officer from the rolls pursuant to section 1161(b) of title 10, United States Code due to absence without authority for at least three months; separation by reason of a sentence to confinement adjudged by a court-martial; or, a sentence to confinement in a Federal or State penitentiary or correctional institution.

**Statutory Language:**

**SEC.  484C.  READMISSION REQUIREMENTS FOR SERVICEMEMBERS.**

**(a)** DEFINITION OF SERVICE IN THE UNIFORMED SERVICES.—

In this section, the term ‘service in the uniformed services’ means service (whether voluntary or involuntary) on active duty in the Armed Forces, including such service by a member of the National Guard or Reserve, for a period of more than 30 days under a call or order to active duty of more than 30 days.

**(b)** DISCRIMINATION AGAINST STUDENTS WHO SERVE IN THE UNIFORMED SERVICES PROHIBITED.—A person who is a member of, applies to be a member of, performs, has performed, applies to perform, or has an obligation to perform, service in the uniformed services shall not be denied readmission to an institution of higher education on the basis of that membership, application for membership, performance of service, application for service, or obligation.

**(c)** READMISSION PROCEDURES.—

**(1)** IN GENERAL.—Any student whose absence from an institution of higher education is necessitated by reason of service in the uniformed services shall be entitled to readmission to the institution of higher education if—

**(A)** the student (or an appropriate officer of the Armed Forces or official of the Department of Defense) gives advance written or verbal notice of such service to the appropriate official at the institution of higher education;

**(B)** the cumulative length of the absence and of all previous absences from that institution of higher education by reason of service in the uniformed services does not exceed five years; and

**(C)** except as otherwise provided in this section, the student submits a notification of intent to reenroll in the institution of higher education in accordance with the provisions of paragraph (4).

**(2)** EXCEPTIONS.—

**(A)** MILITARY NECESSITY.—No notice is required under paragraph (1)(A) if the giving of such notice is precluded by military necessity, such as—

**(i)** a mission, operation, exercise, or requirement that is classified; or

**(ii)** a pending or ongoing mission, operation, exercise, or requirement that may be compromised or otherwise adversely affected by public knowledge.

**(B)** FAILURE TO GIVE ADVANCE NOTICE.—Any student (or an appropriate officer of the Armed Forces or official of the Department of Defense) who did not give advance written or verbal notice of service to the appropriate official at the institution of higher education in accordance with paragraph (1)(A) may meet the notice requirement by submitting, at the time the student seeks readmission, an attestation to the student’s institution of higher education that the student performed service in the uniformed services that necessitated the student’s absence from the institution of higher education.

**(3)** APPLICABILITY.—This section shall apply to a student who is absent from an institution of higher education by reason of service in the uniformed services if such student’s cumulative period of service in the Armed Forces (including the National Guard or Reserve), with respect to the institution of higher education for which a student seeks readmission, does not exceed five years, except that any such period of service shall not include any service—

**(A)** that is required, beyond five years, to complete an initial period of obligated service;

**(B)** during which such student was unable to obtain orders releasing such student from a period of service in the uniformed services before the expiration of such five year period and such inability was through no fault of such student; or

**(C)** performed by a member of the Armed Forces (including the National Guard and Reserves) who is—

**(i)** ordered to or retained on active duty under section 688, 12301(a), 12301(g), 12302, 12304, or 12305 of title 10, United States Code, or under section 331, 332, 359, 360, 367, or 712 of title 14, United States Code;

**(ii)** ordered to or retained on active duty (other than for training) under any provision of law because of a war or national emergency declared by the President or the Congress, as determined by the Secretary concerned;

**(iii)** ordered to active duty (other than for training) in support, as determined by the Secretary concerned, of an operational mission for which personnel have been ordered to active duty under section 12304 of title 10, United States Code;

**(iv)** ordered to active duty in support, as determined by the Secretary concerned, of a critical mission or requirement of the Armed Forces (including the National Guard or Reserve); or

**(v)** called into Federal service as a member of the National Guard under chapter 15 of title 10, United States Code, or section 12406 of title 10, United States Code.

**(4)** NOTIFICATION OF INTENT TO RETURN.—

**(A)** IN GENERAL.—Except as provided in subparagraph (B), a student referred to in subsection (a) shall, upon the completion of a period of service in the uniformed services, notify the institution of higher education of the student’s intent to return to the institution not later than three years after the completion of the period of service.

**(B)** HOSPITALIZATION OR CONVALESCENCE.—A student who is hospitalized for or convalescing from an illness or injury incurred in or aggravated during the performance of service in the uniformed services shall notify the institution of higher education of the student’s intent to return to the institution not later than two years after the end of the period that is necessary for recovery from such illness or injury.

**(C)** SPECIAL RULE.—A student who fails to apply for readmission within the period described in this section shall not automatically forfeit such eligibility for readmission to the institution of higher education, but shall be subject to the institution of higher education’s established leave of absence policy and general practices.

**(5)** DOCUMENTATION.—

**(A)** IN GENERAL.—A student who submits an application for readmission to an institution of higher education under this section shall provide to the institution of higher education documentation to establish that—

**(i)** the student has not exceeded the service limitations established under this section; and

**(ii)** the student’s eligibility for readmission has not been terminated due to an exception in subsection (d).

**(B)** PROHIBITED DOCUMENTATION DEMANDS.—An institution of higher education may not delay or attempt to avoid a readmission of a student under this section by demanding documentation that does not exist, or is not readily available, at the time of readmission.

**(6)** NO CHANGE IN ACADEMIC STATUS.—A student who is readmitted to an institution of higher education under this section shall be readmitted with the same academic status as such student had when such student last attended the institution of higher education.

**(d)** EXCEPTION FROM READMISSION ELIGIBILITY.—A student’s eligibility for readmission to an institution of higher education under this section by reason of such student’s service in the uniformed services terminates upon the occurrence of any of the following events:

**(1)** A separation of such person from the Armed Forces (including the National Guard and Reserves) with a dishonorable or bad conduct discharge.

**(2)** A dismissal of such person permitted under section 1161(a) of title 10, United States Code.

**(3)** A dropping of such person from the rolls pursuant to section 1161(b) of title 10, United States Code.

Issue Paper #17

**Origin:**HEOA

**Issue:**Institutional requirements for teach-outs/eligibility and certification procedures-treatment of teach-outs

**Statutory cites:**Sections 487(f) and 498 of the HEA

**Regulatory cites:**§600.20 and §668.14****

**DCL GEN-08-12 cite:**Pages 72 and 74

**Summary of issue:**  Effective August 14, 2008, section 487(f) of the HEA provides that, whenever the Secretary initiates an action to limit, suspend, or terminate (LS or T) an institution’s participation in any Title IV program or initiates an emergency action against an institution, the institution must prepare a teach-out plan for submission to its accrediting agency.  The teach-out plan must be prepared in accordance with section 496(c)(6) of the HEA [mistakenly cited as section 496(c)(4) in the HEA] and any applicable Title IV regulations or accrediting agency standards.  A “teach-out plan” is defined as a written plan that provides for equitable treatment of students if an institution ceases to operate before all students have completed their program of study.  Currently, the regulations governing the Secretary’s recognition of accrediting agencies define a “teach-out agreement” as a written agreement between institutions that provides for the equitable treatment of students if one of those institutions stops offering an educational program before all students enrolled in that program have completed the program (§602.3).  Consideration should be given to developing one definition for all Title IV regulations. 

Also effective August 14, 2008, section 498 of the HEA provides that a location of a closed institution is eligible as an additional location of another institution for the purpose of conducting a teach-out if the teach-out is approved by the institution’s accrediting agency.  The institution that conducts the teachout under this provision is permitted to establish a permanent additional location at the closed institution without having to satisfy the requirements for additional locations in sections 102(b)(1)(E) and 102(c)(1))(C) of the HEA--i.e., that a proprietary institution or a postsecondary vocational institution must have been in existence for two years to be eligible--and without assuming the liabilities of the closed institution.

Note:  One of the four new accrediting agency operating procedures added by the HEOA at section 496(c)(3) of the HEA requires accrediting agencies to approve teach-out plans submitted by institutions they accredit if the Department notifies the agency of an action against an institution in accordance with section 487(f) of the HEA; if the institution’s accreditation is withdrawn, terminated or suspended; or if the institution intends to cease operations.  This provision is being negotiated by Team III—Accreditation.

**Updated information since 3/2-4 meetings:**Section 668.14 would be amended to implement the requirement in section 487(f) of the HEA.  In addition to the requiring an institution to submit a teach out plan (which would be defined in §600.2) to its accrediting agency whenever the Secretary initiates an LS or T or an emergency action against the institution, as required by statute, an institution would be required to submit a teach out plan when (1) the institution’s accrediting agency acts to withdraw, terminate, or suspend the accreditation of the institution; or (2) the institution otherwise intends to cease operations. 

Section 600.32 would implement section 498(k) of the HEA to provide that an institution that conducts a teach out for a closed institution whenever the Secretary initiates an LS or T or an emergency action against the institution may apply to have that site approved as an additional location, if the teach out plan was approved by the closed institution’s accrediting agency.  If the Department approves the institution to add the additional location, the “two-year rule” would not apply to the additional location, and the institution would not assume the liabilities of the closed institution.  As a condition for approval, the Department may require that payments from the institution conducting the teach out to the owners of the closed institution, or related parties, be used to pay any liabilities owed by the closed institution.

**Tentative agreement:**

**Regulatory language:**

§600.2  General definitions.

The following definitions apply to terms used in this part:

*  *  *  

*Teach-out plan*:  A written plan developed by an institution that provides for the equitable treatment of students if an institution, or an institutional location that provides one hundred percent of at least one program, ceases to operate before all students have completed their program of study, and may include, if required by the institution’s accrediting agency, a teach-out agreement between institutions.

§600.32  Eligibility of additional locations.

(a) Except as provided in paragraphs (b) ~~and~~(c) and (d) of this section, to qualify as an eligible location, an additional location of an eligible institution must satisfy the applicable requirements of this section and §§600.4, 600.5, 600.6, 600.8, and 600.10.

(b) To qualify as an eligible location, an additional location is not required to satisfy the two-year requirement of §§600.5(a)(7) or 600.6(a)(6), unless—

(1) The location was a facility of another institution that has closed or ceased to provide educational programs for a reason other than a normal vacation period or a natural disaster that directly affects the institution or the institution's students;

(2) The applicant institution acquired, either directly from the institution that closed or ceased to provide educational programs, or through an intermediary, the assets at the location; and

(3) The institution from which the applicant institution acquired the assets of the location—

(i) Owes a liability for a violation of an HEA program requirement; and

(ii) Is not making payments in accordance with an agreement to repay that liability.

(c) Notwithstanding paragraph (b) of this section, an additional location is not required to satisfy the two-year requirement of §600.5(a)(7) or §600.6(a)(6) if the applicant institution agrees—

(1) To be liable for all improperly expended or unspent title IV, HEA program funds received by the institution that has closed or ceased to provide educational programs;

(2) To be liable for all unpaid refunds owed to students who received title IV, HEA program funds; and

(3) To abide by the policy of the institution that has closed or ceased to provide educational programs regarding refunds of institutional charges to students in effect before the date of the acquisition of the assets of the additional location for the students who were enrolled before that date.

(d)(1) An institution that conducts a teach out at a site of a closed institution may apply to have that site approved as an additional location if—

(i)  The closed institution ceased operations as result of an action taken by the Secretary to limit, suspend, or terminate the institution’s participation under 34 CFR 600.41 or subpart G of this part, or a result of an emergency action taken by the Secretary under §668.83; and

(ii) The teach-out plan required under §668.14(b)(26) is approved by the closed institution’s accrediting agency. 

(2)(i)  An institution that conducts a teach-out and is approved to add an additional location described in paragraph (d)(1) of this section—

(A)  Is not required to meet the two-year requirement of §600.5(a)(7) or §600.6(a)(6) for the additional location described in paragraph (d)(1) of this section; and

(B)  Is not required to assume the liabilities of the closed institution as required by paragraph (c)(1) and (c)(2) of this section.

(ii)  As a condition for approving an additional location under paragraph (d)(1) of this section, the Secretary may require that payments from the institution conducting the teach out to the owners or related parties of the closed institution, are used to satisfy any liabilities owed by the closed institution.

(~~d~~e)  For purposes of this section, an “additional location” is a location of an institution that was not designated as an eligible location in the eligibility notification provided to an institution under §600.21.

§668.14  Program participation agreement.

*  *  *  *

(b) By entering into a program participation agreement, an institution agrees that—

*  *  *

(26)  In the event the Secretary initiates the limitation, suspension, or termination of the participation of an institution in any Title IV, HEA program under 34 CFR 600.41 or subpart G of this part or initiates an emergency action under §668.83, the institution’s accrediting agency acts to withdraw, terminate, or suspend the accreditation of the institution, or the institution otherwise intends to cease operations, the institution will submit a teach-out plan to its accrediting agency in compliance with 34 CFR 602.24(c), and the standards of the institution’s accrediting agency.

**Statutory language:**

**Section 487.  Program participation agreements.**

***  *  *  *  ***

**(f)** INSTITUTIONAL REQUIREMENTS FOR TEACH-OUTS.—

**(1)** IN GENERAL.—In the event the Secretary initiates the limitation, suspension, or termination of the participation of an institution of higher education in any program under this title under the authority of subsection (c)(1)(F) or initiates an emergency action under the authority of subsection (c)(1)(G) and its prescribed regulations, the Secretary shall require that institution to prepare a teach-out plan for submission to the institution’s accrediting agency or association in compliance with section 496(c)(4) [should be 496(c)(6)], the Secretary’s regulations on teachout plans, and the standards of the institution’s accrediting agency or association.

**(2)** TEACH-OUT PLAN DEFINED.—In this subsection, the term ‘teach-out plan’ means a written plan that provides for the equitable treatment of students if an institution of higher education ceases to operate before all students have completed their program of study, and may include, if required by the institution’s accrediting agency or association, an agreement between institutions for such a teach-out plan.

**Section 498.  Eligibility and certification procedures.**

***  *  *  *  ***

**(k)** TREATMENT OF TEACH-OUTS AT ADDITIONAL LOCATIONS.—

**(1)** IN GENERAL.—A location of a closed institution of higher education shall be eligible as an additional location of an eligible institution of higher education, as defined pursuant to regulations of the Secretary, for the purposes of a teachout described in section 487(f), if such teach-out has been approved by the institution’s accrediting agency.

**(2)** SPECIAL RULE.—An institution of higher education that conducts a teach-out through the establishment of an additional location described in paragraph (1) shall be permitted to establish a permanent additional location at a closed institution and shall not be required—

**(A)** to meet the requirements of sections 102(b)(1)(E) and 102(c)(1)(C) for such additional location; or

**(B)** to assume the liabilities of the closed institution.

**(for reference purposes)**

**Section 496.  Recognition of accrediting agency or association.**

***  *  *  *  ***

**(c)** OPERATING PROCEDURES REQUIRED—No accrediting agency or association may be recognized by the Secretary as a reliable authority as to the quality of education or training offered by an institution seeking to participate in the programs authorized under this title, unless the agency or association—

*  *  *

**(3)** requires an institution to submit for approval to the accrediting agency a teach-out plan upon the occurrence of any of the following events:

**(A)** the Department notifies the accrediting agency of an action against the institution pursuant to section 487(f);

**(B)** the accrediting agency acts to withdraw, terminate, or suspend the accreditation of the institution; or

**(C)** the institution notifies the accrediting agency that the institution intends to cease operations;

*  *  *

~~(4)~~**(6)**requires that teach-out agreements among institutions are subject to the approval by the accrediting agency or association consistent with standards promulgated by such agency or association;

**Issue paper #18**

**Origin:**HEOA

**Issue:**Definition of baccalaureate “liberal arts” programs offered by proprietary schools

**Statutory cites:**Section 102(b) of the HEA

**Regulatory cites:**§600.5

**DCL GEN-08-12 cite:**Pages 23-24

**Summary of issue:**Effective July 1, 2010, the definition of “proprietary institution of higher education” is amended to add institutions that provide a program leading to a baccalaureate degree in liberal arts that the institution has provided since January 1, 2009, so long as the institution has been accredited by a recognized regional accreditation agency or organization since October 1, 2007, or earlier.  

As the language in section 102(b)(1)(A)(i) of the HEA is not new, in Dear Colleague letter GEN-08-12, the Department noted that this change does not affect the eligibility of current programs or alter the method used by the Secretary in determining the “recognized occupations” as required by section 102(b)(1)(A)(i) of the HEA.

Dear Colleague letter GEN-08-12 also noted that, pending negotiated rulemaking, the Secretary will regard a program as satisfying the "liberal arts" term of the statute if the Secretary determines, and the institution's recognized regional accreditation agency or organization affirms, that it is a general instructional program in the liberal arts subjects, the humanities disciplines, or the general curriculum, falling within one or more of the following generally-accepted instructional categories comprising such programs, but including only instruction in regular programs, and excluding independently-designed programs, individualized programs, and unstructured studies:

· a program that is a structured combination of the arts, biological and physical sciences, social sciences, and humanities, emphasizing breadth of study;

· an undifferentiated program that includes instruction in the general arts or general science;

· a program that focuses on combined studies and research in the humanities subjects as distinguished from the social and physical sciences, emphasizing languages, literatures, art, music, philosophy and religion; and

· any single instructional program in liberal arts and sciences, general studies and humanities not listed above.

**Updated information since 3/2-4 meetings:**Section 600.5 would be amended to add to the definition of “proprietary institution of higher education” institutions that provide a program leading to a baccalaureate degree in liberal arts that the institution has provided since January 1, 2009, so long as the institution has been accredited by a recognized regional accreditation agency or organization since October 1, 2007, or earlier.  In addition, a new paragraph (i) would be added to §600.5 to include a definition of a “program leading to a baccalaureate degree in liberal arts.”  The definition would require that the institution's recognized regional accreditation agency or organization determine that the program is a general instructional program in the liberal arts subjects, the humanities disciplines, or the general curriculum, falling within one or more generally-accepted instructional categories comprising such programs.  The categories are from the U.S. Department of Education’s National Center for Education Statistics’ (NCES) Classification of Instructional Programs (CIP), the federal government statistical standard on instructional program classifications.  Specifically, the instructional categories are from the description of CIP 24, Liberal Arts and Sciences, General Studies and Humanities, except that it excludes independently-designed programs, individualized programs, and unstructured studies.

**Tentative agreement:**

**Regulatory language:**

###### §600.5  Proprietary institution of higher education.

(a)  A proprietary institution of higher education is an educational institution that—

(1)  Is not a public or private nonprofit educational institution;

(2)  Is in a State;

(3)  Admits as regular students only persons who—

(i)  Have a high school diploma;

(ii)  Have the recognized equivalent of a high school diploma; or

(iii)  Are beyond the age of compulsory school attendance in the State in which the institution is physically located;

(4)  Is legally authorized to provide an educational program beyond secondary education in the State in which the institution is physically located;

(5)(i)  Provides an eligible program of training, as defined in 34 CFR 668.8, to prepare students for gainful employment in a recognized occupation; or

(ii)(A)  Provides a program leading to a baccalaureate degree in liberal arts, as defined in paragraph (i) of this section, and has provided that program since January 1, 2009; and

(B)  Is accredited by a recognized regional accrediting agency or association, and has continuously held such accreditation since October 1, 2007, or earlier;

***  *  ***

(i)  For purposes of this section, a “program leading to a baccalaureate degree in liberal arts” is a program that the institution's recognized regional accreditation agency or organization determines, is a general instructional program in the liberal arts subjects, the humanities disciplines, or the general curriculum, falling within one or more of the following generally-accepted instructional categories comprising such programs, but including only instruction in regular programs, and excluding independently-designed programs, individualized programs, and unstructured studies--

(1)  A program that is a structured combination of the arts, biological and physical sciences, social sciences, and humanities, emphasizing breadth of study;

(2)  An undifferentiated program that includes instruction in the general arts or general science;

(3)  A program that focuses on combined studies and research in the humanities subjects as distinguished from the social and physical sciences, emphasizing languages, literatures, art, music, philosophy and religion; and

(4)  Any single instructional program in liberal arts and sciences, general studies and humanities not listed above.

**Statutory Language:**

**Section 102.  Definition of institution of higher education for purposes of Title IV programs.**

***  *  *  *  ***

(b) PROPRIETARY INSTITUTION OF HIGHER EDUCATION.—

(1) PRINCIPAL CRITERIA.—For the purpose of this section, the term ‘‘proprietary institution of higher education’’ means a school that—

~~(A) provides an eligible program of training to prepare students for gainful employment in a recognized occupation;~~

**(A)(i)** provides an eligible program of training to prepare students for gainful employment in a recognized occupation; or

**(ii)(I)** provides a program leading to a baccalaureate degree in liberal arts, and has provided such a program since January 1, 2009; and

**(II)** is accredited by a recognized regional accrediting agency or association, and has continuously held such accreditation since October 1, 2007, or earlier;

**Issue Paper #19**

**Origin:**HEOA

**Issue:**Peer-to-peer file sharing/copyrighted material

**Statutory cites:**Section 485(a) and 487 of the HEA

**Regulatory cites:**§668.14 and §668.43

**DCL GEN-08-12 cite:**Pages 72 and 95

**Summary of issue:**Effective August 14, 2008, the HEOA adds a new requirement to section 487 of the HEA (Program Participation Agreement) under which an institution must certify that it has developed plans to effectively combat the unauthorized distribution of copyrighted material (including through the use of a variety of technology-based deterrents) and will, to the extent practicable, offer alternatives to illegal downloading or peer-to-peer distribution of intellectual property, as determined by the institution in consultation with the chief technology officer or other designated officer of the institution.

In addition, as part of the required information an institution must make available to prospective and enrolled students the HEOA adds new subparagraph (P) to section 485(a)(1) of the HEA to require a description of institutional policies and sanctions related to copyright infringement.  This description includes (1) an annual disclosure that explicitly informs students that unauthorized distribution of copyrighted material, including peer-to-peer file sharing, may subject the students to civil and criminal liabilities; (2) a summary of the penalties for violation of Federal copyright laws; and (3) the institution’s policies with respect to unauthorized peer-to-peer file sharing, including disciplinary actions that are taken against students who engage in unauthorized distribution of copyrighted materials using the institution’s information technology system.  This provision is also effective August 14, 2008.

**Updated information since 3/2-4 meetings:**

Generally, in drafting these proposed regulations, the Department sought to stay as close as possible to the actual language of the statute.  In recognition of the diversity among institutions and evolving technology, we chose not to mandate in regulation the use of specific technologies or measures.  At the same time, we sought to give meaning to the statute in a way that provides clarity so that institutions understand what is expected of them to comply with these provisions. 

***Program participation agreement***

Section 668.14(b)(27)(i) would implement section 487(a)(29)(A) of the HEA to require an institution, as a condition of participation in a Title IV program, to agree that it has developed and implemented plans to effectively combat the unauthorized distribution of copyrighted material by users of the institution’s network without unduly interfering with the educational and research use of the network.   

The proposed language reflects general agreement by the subcommittee that the plan should include the use of technology-based deterrents, an educational component, a description of the institution’s procedures for handling copyright infringement, and a required periodic review of the plan.  Institutions would not be required to use specific types of technology-based deterrents.   To assist with implementation, the four categories of technology-based deterrents listed in the conference report to the HEOA could be listed in the preamble to the regulations.  Institutions would be required to demonstrate the effectiveness of their plan by using measureable criteria.  Institutions would be allowed to determine the most appropriate measure or measures.  

Section 668.14(b)(27)(ii) would implement section 487(a)(29)(B) of the HEA, requiring that institutions, in consultation with the chief technology officer or other designated officer of the institution, to the extent practicable, offer legal alternatives to illegal downloading or otherwise acquiring copyrighted material.  The proposed language also reflects general agreement among the subcommittee members that institutions (1) be required to periodically review the legal alternatives for downloading or otherwise acquiring copyrighted material and (2) provide the results of the review.

***Consumer information***

The Department is proposing to implement section 485(a)(1)(P) of the HEA by using, as much as practicable, the existing framework and definitions found in current regulations.  As the statute requires that most institutional information be made readily available upon request to prospective and enrolled students, rather than provided to them on a one-to-one basis, information regarding institutional policies and sanctions related to copyright infringement would be handled in the same manner (i.e., included in the list of institutional information provided upon request pursuant to §668.43).  This information would be required to (1) explicitly inform enrolled and prospective students that unauthorized distribution of copyrighted material, including peer-to-peer file sharing, may subject a student to civil and criminal liabilities; (2) include a summary of the penalties for violation of Federal copyright laws; and (3) delineate the institution’s policies with respect to unauthorized peer-to-peer file sharing, including disciplinary actions that are taken against students who engage in illegal downloading or unauthorized distribution of copyrighted materials using the institution’s information technology system.  As the statute does not require disclosure of this information to employees of the institution, this would not be mandated in the regulations.  However, institutions could choose to make such information available to employees and the general public.

As current §668.41(c) requires an institution to provide to enrolled students an annual notice containing a list and brief description of the consumer information it must disclose and the procedures for obtaining this consumer information, an institution would be required to add to this list the fact that it must make readily available information regarding institutional policies and sanctions related to copyright infringement.  Per the current definition of “notice” in §668.41(a), institutions must provide this annual notice on a one-to-one basis through a direct individual notice to each enrolled student. This notice must be made through an appropriate mailing or publication, including direct mailing through the U.S. Postal Service, campus mail or electronic mail.  Posting on Internet or Intranet websites does not constitute notice.  If the institution discloses the consumer information by posting the information on a website, it must include in the notice the exact electronic address at which the information is posted, and a statement that the institution will provide a paper copy of the information on request.

The current definition of “prospective student” in §668.41(a) would be used—i.e., an individual who has contacted an eligible institution requesting information concerning admission to that institution.

**Tentative agreement:**

**Regulatory language:**

§668.14  Program participation agreement.

*  *  *  *  *

     (b) By entering into a program participation agreement, an institution agrees that—

*  *  *

(27)  The institution—

(i)  Has developed and implemented written plans to effectively combat the unauthorized distribution of copyrighted material by users of the institution’s network, without unduly interfering with educational and research use of the network, that include—

(A) The use of technology-based deterrents; 

(B)  Mechanisms for educating and informing its community about appropriate versus inappropriate use of copyrighted material; 

(C)  Procedures for handling copyright infringements, including disciplinary procedures; and

(D)  Procedures for periodically reviewing the effectiveness of the plan to combat the unauthorized distribution of copyrighted materials by users of the institutions network based on measureable criteria which may include the number of copyright infringement notices received and the rate of recidivism.

(ii)  Will, in consultation with the chief technology officer or other designated officer of the institution —

(A)  Periodically review the legal alternatives for downloading or otherwise acquiring copyrighted material; 

(B)  Make available the results of the review in paragraph (b)(27)(ii)(A) to its students, and employees through a website and/or other means; and

(C)  To the extent practicable, offer legal alternatives for downloading or otherwise acquiring copyrighted material, as determined by the institution.

§668.43  Institutional information.

(a)  Institutional information that the institution must make readily available upon request to enrolled and prospective students under this subpart includes, but is not limited to—

*  *  *

(8)  The titles of persons designated under §668.44 and information regarding how and where those persons may be contacted; ~~and~~

(9)  A statement that a student's enrollment in a program of study abroad approved for credit by the home institution may be considered enrollment at the home institution for the purpose of applying for assistance under the title IV, HEA programs~~.~~and;

(10)  Institutional policies and sanctions related to copyright infringement, including—

(i)  A statement that explicitly informs the students that unauthorized distribution of copyrighted material, including unauthorized peer-to-peer file sharing, may subject the students to civil and criminal liabilities;

(ii)  A summary of the penalties for violation of Federal copyright laws; and

(iii)  A description of the institution’s policies with respect to unauthorized peer-to-peer file sharing, including disciplinary actions that are taken against students who engage in illegal downloading or unauthorized distribution of copyrighted materials using the institution’s information technology system. 

**Statutory language:**

**SEC. 485.  Institutional and Financial Assistance for Students.**

**(a)**INFORMATION DISSEMINATION ACTIVITIES.—

**(1)**Each eligible institution participating in any program under this title shall carry out information dissemination activities for prospective and enrolled students (including those attending or planning to attend less than full time) regarding the institution and all financial assistance under this title. The information required by this section shall be produced and be made readily available upon request, through appropriate publications, mailings, and electronic media, to an enrolled student and to any prospective student. Each eligible institution shall, on an annual basis, provide to all enrolled students a list of the information that is required to be provided by institutions to students by this section and section 444 of the General Education Provisions Act (also referred to as the Family Educational Rights and Privacy Act of 1974), together with a statement of the procedures required to obtain such information. The information required by this section shall accurately describe—

* * *

**(P)**institutional policies and sanctions related to copyright infringement, including—

**(i)**an annual disclosure that explicitly informs students that unauthorized distribution of copyrighted material, including unauthorized peer-to-peer file sharing, may subject the students to civil and criminal liabilities;

**(ii)**a summary of the penalties for violation of Federal copyright laws; and

**(iii)**a description of the institution’s policies with respect to unauthorized peer-to-peer file sharing, including disciplinary actions that are taken against students who engage in unauthorized distribution of copyrighted materials using the institution’s information technology system;

**Section 487.  Program participation agreements.**

***  *  *  *  ***

**(a)**REQUIRED FOR PROGRAMS OF ASSISTANCE; CONTENTS.—In order to be an eligible institution for the purposes of any program authorized under this title, an institution must be an institution of higher education or an eligible institution (as that term is defined for the purpose of that program) and shall, except with respect to a program under subpart 4 of part A, enter into a program participation agreement with the Secretary. The agreement shall condition the initial and continuing eligibility of an institution to participate in a program upon compliance with the following requirements:

### *  *  *

**(29)**The institution certifies that the institution—

**(A)**has developed plans to effectively combat the unauthorized distribution of copyrighted material, including through the use of a variety of technology-based deterrents; and

**(B)**will, to the extent practicable, offer alternatives to illegal downloading or peer-to-peer distribution of intellectual property, as determined by the institution in consultation with the chief technology officer or other designated officer of the institution.

**Issue Paper #20**

**Origin:**HEOA

**Issue:**Institutional plans for improving the academic program

**Statutory cites:**Section 485(a) of the HEA

**Regulatory cites:**§668.43 

**DCL GEN-08-12 cite:**Page 95

**Summary of issue:**As part of the required information an institution must make available to prospective and****enrolled students, the HEOA adds to the existing description of the academic program any plans the institution has for improving the academic program.  This provision was effective August 14, 2008.

**Updated information since 3/2-4 meetings:**Section 668.43 would be amended to add to the institutional information that an institution must make readily available upon request to enrolled and prospective students any plans by the institution for improving the academic program of the institution.

**Tentative agreement:**

**Regulatory language:**

§668.43  Institutional information.

(a) Institutional information that the institution must make readily available upon request to enrolled and prospective students under this subpart includes, but is not limited to—

*  *  *

(5)  The academic program of the institution, including—

(i)  The current degree programs and other educational and training programs;

(ii)  The instructional, laboratory, and other physical facilities which relate to the academic program;~~and~~

(iii)  The institution's faculty and other instructional personnel; and

(iv)  Any plans by the institution for improving the academic program of the institution.

**Statutory Language:**

**SEC. 485.  Institutional and Financial Assistance for Students.**

(a) INFORMATION DISSEMINATION ACTIVITIES.—

(1) Each eligible institution participating in any program under this title shall carry out information dissemination activities for prospective and enrolled students (including those attending or planning to attend less than full time) regarding the institution and all financial assistance under this title. The information required by this section shall be produced and be made readily available upon request, through appropriate publications, mailings, and electronic media, to an enrolled student and to any prospective student. Each eligible institution shall, on an annual basis, provide to all enrolled students a list of the information that is required to be provided by institutions to students by this section and section 444 of the General Education Provisions Act (also referred to as the Family Educational Rights and Privacy Act of 1974), together with a statement of the procedures required to obtain such information. The information required by this section shall accurately describe—

***  *  ***

(G) the academic program of the institution, including (i) the current degree programs and other educational and training programs, (ii) the instructional, laboratory, and other physical plant facilities which relate to the academic ~~program, and~~program, (iii) the faculty and other instructional personnel, and (iv) any plans by the institution for improving the academic program of the institution;

# Issue Paper # 21

**Origin:**HEOA

**Issue:**Leveraging Educational Assistance Partnership (LEAP) Program Non-Federal Share

**Statutory cites:**Section 415C(b)(10) of the HEA

**Regulatory cites:**§692.10

**DCL GEN-08-12 cite:**None

**Summary of issue:**The HEA as amended by the HEOA provides that the non-Federal share of the amount of student grants or work-study jobs under the LEAP Program must be from State funds for the program and no longer requires the non-Federal share to come from a direct appropriation of State funds.  

**Updated information since 3/2-4 meetings:**

**Tentative agreement:**

**Regulatory Language:**

§692.10  How does the Secretary allot funds to the States?

(a)(1) The Secretary allots to each State participating in the LEAP program an amount which bears the same ratio to the Federal LEAP funds appropriated as the number of students in that State who are “deemed eligible” to participate in the State's LEAP program bears to the total number of students in all States who are “deemed eligible” to participate in the LEAP program, except that no State may receive less than it received in fiscal year 1979 for the programs under this part.

(2) For the programs under this part, ~~I~~if the Federal ~~LEAP~~funds appropriated for a fiscal year are not sufficient to allot to each State the amount of Federal ~~LEAP~~funds it received in fiscal year 1979, the Secretary allots to each State an amount which bears the same ratio to the amount of Federal ~~LEAP~~funds appropriated as the amount of Federal ~~LEAP~~ funds that State received in fiscal year 1979 bears to the amount of Federal ~~LEAP~~ funds all States received in fiscal year 1979 for the programs under this part.

(b) For the purpose of paragraph (a)(1) of this section, the Secretary determines the number of students “deemed eligible” to participate in a State's LEAP Program by dividing the amount of that State's LEAP expenditures, including both its Federal allotment and the State~~-appropriated~~ funds matching the allotment, by the average grant award per student of all participating States.  The Secretary determines the “average grant award per student” by dividing the total number of student recipients for all States into the total amount of LEAP expenditures for all States, including both the Federal allotments and the State~~-appropriated~~ funds matching those allotments.  In making this determination, the Secretary uses the most current available data reported by each State.

**Statutory Language:**

**(10)**For any academic year beginning after June 30, 1987, provides the non-Federal share of the amount of student grants or work-study jobs under this subpart through ~~a direct appropriation of~~ state funds for the program under this subpart; and

# Issue Paper # 22

**Origin:**HEOA

**Issue:**Notification to Students of Source of LEAP Grant Funding

**Statutory cites:**Section 415C(b)(11) of the HEA

**Regulatory cites:**§692.21

**DCL GEN-08-12 cite:**Page 110

**Summary of issue:**The HEA as amended by the HEOA requires the State program to notify eligible students that grants are (1) LEAP Grants and (2) are funded by the Federal Government, the State, and, for LEAP Grants to students made under GAP, other contributing partners.

**Updated information since 3/2-4 meetings:**

**Tentative agreement:**

**Regulatory Language:**

§692.21  What requirements must be met by a State program?

To receive a payment under the LEAP Program for any fiscal year, a State must have a program that—

(a) Is administered by a single State agency;     

(b) Provides assistance only to students who meet the eligibility requirements in §692.40;

(c) Provides that assistance under this program to a full-time student will not be more than the lesser of $12,500 ~~5,000~~ or the student’s cost of attendance under section 472 of the HEA for each academic year;

(d) Provides for the selection of students to receive assistance on the basis of substantial financial need determined annually by the State on the basis of standards that the State establishes and the Secretary approves;

(e) Provides that no student or parent shall be charged a fee that is payable to an organization other than the State for the purpose of collecting data to make a determination of financial need in accordance with paragraph (d) of this section;

(f) Provides that all public or private nonprofit institutions of higher education and all postsecondary vocational institutions in the State are eligible to participate unless that participation is in violation of—

(1) The constitution of the State; or

(2) A State statute that was enacted before October 1, 1978;

(g) Provides that, if a State awards grants to independent students or to students who are less-than-full-time students enrolled in an institution, a reasonable portion of the State's allocation must be awarded to those students;

(h) Provides that—

(1) The State will pay an amount for grants and work-study jobs under this part for each fiscal year that is not less than the payment to the State under this part for that fiscal year; and

(2) The amount that the State expends during a fiscal year for grants and work-study jobs under the LEAP Program represents an additional amount for grants and work-study jobs for students attending institutions over the amount expended by the State for those activities during the fiscal year two years prior to the fiscal year in which the State first received funds under the LEAP Program;

(i) Provides for State expenditures under the State program of an amount that is not less than--

(1) The average annual aggregate expenditures for the preceding three fiscal years; or

(2) The average annual expenditure per full-time equivalent student for those years;

(j) Provides that, to the extent practicable, the proportion of the funds awarded to independent students in the LEAP Program shall be the same proportion of funds awarded to independent students as is in the State program or programs of which the State's LEAP Program is a part; ~~and~~

(k) Notifies eligible students that the grants are—

(1) Leveraging Educational Assistance Partnership Grants; and

(2) Funded by the Federal Government, the State, and, where applicable, other contributing partners; and

(~~k~~l) Provides for reports to the Secretary that are necessary to carry out the Secretary's functions under the LEAP Program.

**Statutory Language:**

**(11)**provides notification to eligible students that such grants are—

(A) Leveraging Educational Assistance Partnership Grants; and

(B)****funded by the Federal Government, the State, and, where applicable, other contributing partners.

**Issue Paper #23**

**Origin:**HEOA

**Issue:**GAP Program Activities:  Partnerships 

**Statutory cites:**Section 415E(c)(4) and (d) of the HEA

**Regulatory cites:**§§692.94, 692.100, 692.101, and 692.111

**DCL GEN-08-12 cite:**Page 113

**Summary of issue:**

***Partnership***

Each State receiving an allotment must use the funds to establish a partnership to award LEAP Grants under GAP to eligible low-income students in order to increase the amount of financial assistance these students receive under these programs for undergraduate education expenses.

***Roles of Partners***

State agency

A State agency that is in a partnership receiving a GAP allotment serves as the primary administrative unit for the partnership.  The State agency:

· provides or coordinates non-Federal share funds and coordinates activities among partners; 

· encourages each institution of higher education in the State to participate in the partnership; 

· makes determinations and early notifications of assistance; 

· annually reports to the Secretary on the partnership’s progress in meeting the purpose of GAP; and 

· may provide early information and intervention, mentoring, or outreach programs.

Degree-granting institution of higher education

An institution in a partnership:

· must recruit and admit participating qualified students and provide such additional institutional grant aid to participating students as agreed to with the State agency; 

· must provide support services to students who receive LEAP Grants under GAP and are enrolled at the institution; 

· must assist the State in the identification of eligible students and the dissemination of early notifications of assistance as agreed to with the State agency; and 

· may provide funding for early information and intervention, mentoring, or outreach programs or provide such services directly.

Early intervention programs

An early information and intervention, mentoring, or outreach program that is in a partnership must provide direct services, support, and information to participating students.

#### Philanthropic organization or private corporation

A philanthropic organization or private corporation that is in a partnership must provide funds for LEAP Grants under GAP for participating students or provide funds or support for early information and intervention, mentoring, or outreach programs.

**Updated information since 3/2-4 meetings:**

**Tentative agreement:**

**Regulatory Language:**

See §692.94 on page 2 of Appendix A.

See §692.100 on page 2-3 of Appendix A.

See §692.101 on page 4 of Appendix A.

See §692.111 on page 5-7 of Appendix A.

**Statutory Language:**

**(c) *  *  ***

***  *  *  *  ***

**(4)**ROLES OF PARTNERS.—

**(A)**STATE AGENCY.—A State agency that is in a partnership receiving an allotment under this section—

**(i)**shall—

**(I)**serve as the primary administrative unit for the partnership;

**(II)**provide or coordinate non-Federal share funds, and coordinate activities among  partners;

**(III)**encourage each institution of higher education in the State to participate in the partnership;

**(IV)**make determinations and early notifications of assistance as described under subsection (d)(2); and

**(V)**annually report to the Secretary on the partnership’s progress in meeting the purpose of this section; and

**(ii)**may provide early information and intervention, mentoring, or outreach programs.

**(B)**DEGREE-GRANTING INSTITUTIONS OF HIGHER EDUCATION.—A degree-granting institution of higher education that is in a partnership receiving an allotment under this section—

**(i)**shall—

**(I)**recruit and admit participating qualified students and provide such additional institutional grant aid to participating students as agreed to with the State agency;

**(II)**provide support services to students who receive grants for access and persistence under this section and are enrolled at such institution; and

**(III)**assist the State in the identification of eligible students and the dissemination of early notifications of assistance as agreed to with the State agency; and

**(ii)**may provide funding for early information and intervention, mentoring, or outreach programs or provide such services directly.

**(C)**PROGRAMS.—An early information and intervention, mentoring, or outreach program that is in a partnership receiving an allotment under this section shall provide direct services, support, and information to participating students.

**(D)**PHILANTHROPIC ORGANIZATION OR PRIVATE CORPORATION.— A philanthropic organization or private corporation that is in a partnership receiving an allotment under this section shall provide funds for grants for access and persistence for participating students, or provide funds or support for early information and intervention, mentoring, or outreach programs.

**(d)**AUTHORIZED ACTIVITIES.—

**(1)**IN GENERAL.—

**(A)**ESTABLISHMENT OF PARTNERSHIP.—Each State receiving an allotment under this section shall use the funds to establish a partnership to award grants for access and persistence to eligible low-income students in order to increase the amount of financial assistance such students receive under this subpart for undergraduate education expenses.

**Issue paper #24**

**Origin:**HEOA

**Issue:**GAP Program Activities:  Awards

**Statutory cites:**Section 415E(d) of the HEA

**Regulatory cites:**§§692.111(b) and 692.120

**DCL GEN-08-12 cite:**Page 114

**Summary of issue:**

##### LEAP Grant under GAP amount

The amount of a LEAP Grant under GAP awarded by a State to a student must be not less than the average undergraduate tuition and mandatory fees at the public institutions of higher education in the State where the student resides that are of the same type of institution as the institution of higher education the student attends minus other Federal and State aid the student receives. 

###### Institutions of higher education

A State receiving a GAP allotment may restrict the use of LEAP Grants under GAP by awarding the grants only to students attending institutions of higher education that are participating in the partnership.  If a State provides LEAP Grants not awarded under GAP to students attending institutions of higher education located in another State, grants awarded under GAP may be used at institutions of higher education located in another State.

***Student eligibility***

A student must meet one of the following:

· The student meets at least two of the following criteria, with priority given to students meeting all of the following criteria:

· has an EFC equal to zero, as determined under the Title IV need analysis, or a comparable alternative based upon the State’s approved criteria for LEAP; 

· qualifies for the State’s maximum undergraduate award for LEAP; or

· is participating in, or has participated in, a Federal, State, institutional, or community early information and intervention, mentoring, or outreach program, as recognized by the State agency administering LEAP and GAP.

· The student is receiving, or has received, a LEAP Grant under GAP, and is compliant with the requirements for the duration of an award.

###### Grant award

Once a student, including those students who have received an early notification from the State, applies for admission to an institution that is a partner in the partnership, files a FAFSA and any related State form, and is determined by the State to meet the student eligibility requirements in the prior section, the State must issue the student a preliminary award certificate for a LEAP Grant under GAP with estimated award amounts and inform the student that payment of the grant award amounts is subject to certification of enrollment and award eligibility by the student’s institution of higher education.

###### Duration of an award

An eligible student who receives a LEAP Grant under GAP receives an award for each year of the student’s undergraduate education in which the student remains eligible for assistance under Title IV, including meeting the Title IV satisfactory academic progress standards, and remains financially eligible as determined by the State, except that the State may impose reasonable time limits to degree completion**.**

**Updated information since 3/2-4 meetings:**

**Tentative agreement:**

**Regulatory Language:**

See §692.111(b) on page 5 of Appendix A.

See §692.120 on page 8-9 of Appendix A.

**Statutory Language:**

**(d)**AUTHORIZED ACTIVITIES.—

**(1)**IN GENERAL.—

**(A)  *  *  ***

**(B)**AMOUNT OF GRANTS.—The amount of a grant for access and persistence awarded by a State to a student under this section shall be not less than—

**(i)**the average undergraduate tuition and mandatory fees at the public institutions of higher education in the State where the student resides that are of the same type of institution as the institution of higher education the student attends; minus

**(ii)**other Federal and State aid the student receives.

**(C)**SPECIAL RULES.—

**(i)**PARTNERSHIP INSTITUTIONS.—A State receiving an allotment under this section may restrict the use of grants for access and persistence under this section by awarding the grants only to students attending institutions of higher education that are participating in the partnership.

**(ii)**OUT-OF-STATE INSTITUTIONS.—If a State provides grants through another program under this subpart to students attending institutions of higher education located in another State, grants awarded under this section may be used at institutions of higher education located in another State.

**(2) *****

**(3)**ELIGIBILITY.—In determining which students are eligible to receive grants for access and persistence, the State shall ensure that each such student complies with the following subparagraph (A) or (B):

**(A)**Meets not less than two of the following criteria, with priority given to students meeting all of the following criteria:

**(i)**Has an expected family contribution equal to zero, as determined under part F, or a comparable alternative based upon the State’s approved criteria in section 415C(b)(4).

**(ii)**Qualifies for the State’s maximum undergraduate award, as authorized under section 415C(b).

**(iii)**Is participating in, or has participated in, a Federal, State, institutional, or community early information and intervention, mentoring, or outreach program, as recognized by the State agency administering activities under this section.

**(B)**Is receiving, or has received, a grant for access and persistence under this section, in accordance with paragraph (5).

**(4)**GRANT AWARD.—Once a student, including those students who have received early notification under paragraph (2) from the State, applies for admission to an institution that is a partner in the partnership, files a Free Application for Federal Student Aid and any related State form, and is determined eligible by the State under paragraph (3), the State shall—

**(A)**issue the student a preliminary award certificate for a grant for access and persistence with estimated award amounts; and

**(B)**inform the student that payment of the grant for access and persistence award amounts is subject to certification of enrollment and award eligibility by the institution of higher education.

**(5)**DURATION OF AWARD.—An eligible student who receives a grant for access and persistence under this section shall receive such grant award for each year of such student’s undergraduate education in which the student remains eligible for assistance under this title, including pursuant to section 484(c), and remains financially eligible as determined by the State, except that the State may impose reasonable time limits to degree completion.

**Issue Paper #25**

**Origin:**HEOA

**Issue:**GAP Program Activities:  Early Notification

**Statutory cites:**Section 415E(d)(2) of the HEA****

**Regulatory cites:**§692.111(d)

**DCL GEN-08-12 cite:**Pages 114-115

**Summary of issue:**  Each State receiving a GAP allotment must annually notify low-income students in grades seven through 12 in the State, and their families, of their potential eligibility for student financial assistance, including a LEAP Grant under GAP, to attend an institution of higher education.  

The notice must include:

· Information about early information and intervention, mentoring, or outreach programs available to the student;

· Information that a student’s eligibility for a LEAP Grant under GAP is enhanced through participation in an early information and intervention, mentoring, or outreach program;

· An explanation that student and family eligibility for, and participation in, other Federal means-tested programs may indicate eligibility for a LEAP Grant under GAP and other student aid programs;

· A nonbinding estimate of the total amount of financial aid that a low-income student with a similar income level may expect to receive, including an estimate of the amount of a LEAP Grant under GAP and an estimate of the amount of grants, loans, and all other available types of aid from the major Federal and State financial aid programs;

· An explanation that the eligibility requirements a student must meet to be eligible for a LEAP Grant under GAP including graduating from secondary school and enrolling in a partner institution or an eligible out-of-State institution;

· Information on any additional requirements (such as a student pledge detailing student responsibilities) that the State may impose for receipt of a LEAP Grant under GAP; and

· Instructions on how to apply for a LEAP Grant under GAP and an explanation that a student must file a FAFSA to be eligible for a LEAP Grant under GAP and assistance from other Federal and State financial aid programs.

The notification may include a disclaimer that LEAP Grants under GAP are contingent on (a) a student’s financial eligibility at the time of the student’s enrollment at an institution of higher education; (b) the annual Federal and State spending for higher education; and (c) other aid received by the student at the time of the student’s enrollment at an institution of higher education.

**Updated information since 3/2-4 meetings:**

**Tentative agreement:**

**Regulatory Language:**

See §692.111(d) on page 6 of Appendix A.

**Statutory Language:**

**(2)**EARLY NOTIFICATION.—

**(A)**IN GENERAL.—Each State receiving an allotment under this section shall annually notify low-income students in grades seven through 12 in the State, and their families, of their potential eligibility for student financial assistance, including an access and persistence grant, to attend an institution of higher education.

**(B)**CONTENT OF NOTICE.—The notice under subparagraph (A)—

**(i)**shall include—

**(I)**information about early information and intervention, mentoring, or outreach programs available to the student;

**(II)**information that a student’s eligibility for a grant for access and persistence is enhanced through participation in an early information and intervention, mentoring, or outreach program;

**(III)**an explanation that student and family eligibility for, and participation in, other Federal means-tested programs may indicate eligibility for a grant for access and persistence and other student aid programs;

**(IV)**a nonbinding estimate of the total amount of financial aid that a low-income student with a similar income level may expect to receive, including an estimate of the amount of a grant for access and persistence and an estimate of the amount of grants, loans, and all other available types of aid from the major Federal and State financial aid programs;

**(V)**an explanation that in order to be eligible for a grant for access and persistence, at a minimum, a student shall—

**(aa)**meet the requirement under paragraph (3);

**(bb)**graduate from secondary school; and

**(cc)**enroll at an institution of higher education—

**(AA)**that is a partner in the partnership; or

**(BB)**with respect to which attendance is permitted under subsection (d)(1)(C)(ii);

**(VI)**information on any additional requirements (such as a student pledge detailing student responsibilities) that the State may impose for receipt of a grant for access and persistence under this section; and

**(VII)**instructions on how to apply for a grant for access and persistence and an explanation that a student is required to file a Free Application for Federal Student Aid authorized under section 483(a) to be eligible for such grant and assistance from other Federal and State financial aid programs; and

**(ii)**may include a disclaimer that grant awards for access and persistence are contingent on—  

**(I)**a determination of the student’s financial eligibility at the time of the student’s enrollment at an institution of higher education that is a partner in the partnership or qualifies under subsection (d)(1)(C)(ii);

**(II)**annual Federal and State spending for higher education; and

**(III)**other aid received by the student at the time of the student’s enrollment at such institution of higher education.

**Issue paper #26**

**Origin:**HEOA

**Issue:**Applicability of LEAP Program Requirements

**Statutory cites:**Section 415E(g) of the HEA

**Regulatory cites:**§§692.94(a)(4), 692.100(h) and 692.110

**DCL GEN-08-12 cite:**Page 110

**Summary of issue:**The HEOA provides that LEAP Program requirements will apply to GAP to the extent that they are not inconsistent with GAP requirements.

**Updated information since 3/2-4 meetings:**

**Tentative agreement:**

**Regulatory Language:**

See §692.94(a)(4) on page 2 of Appendix A.

See §692.100(h) on page 4 of Appendix A.

See §692.110 on pages 4-5 of Appendix A.

**Statutory Language:**

**(g)**APPLICABILITY RULE.—The provisions of this subpart that are not inconsistent with this section shall apply to the program authorized by this section.

**Issue Paper #27**

**Origin:**HEOA

**Issue:**GAP Allotment:****Application

**Statutory cites:**Section 415E(c) of the HEA

**Regulatory cites:**§§692.94 and 692.100 

**DCL GEN-08-12 cite:**Pages 112-113

**Summary of issue:**To receive a GAP allotment, a State must submit an application at such time, in such manner, and containing such information as the Secretary may require.

An application on behalf of a partnership that must include the following information:

· A description of the State’s plan for using the allotted funds.

· An assurance that the State will provide matching funds, in cash or in-kind, from State, institutional, philanthropic, or private funds, of not less than 33.33 percent of the cost of carrying out the program.  A State that uses non-Federal funds to create or expand partnerships, in which partners match State funds for student scholarships, may apply the matching funds from those entities toward fulfilling the State’s matching non-Federal share.

· An assurance that the State will use Federal GAP funds to supplement, and not supplant, Federal and State funds available for carrying out the activities under Title IV of the HEA.

· An assurance that early information and intervention, mentoring, or outreach programs exist within the State or that there is a plan to make these programs widely available.

· A description of the organizational structure that the State has in place to administer the program, including a description of how the State will compile information on degree completion of students receiving grants under this section.

· A description of the steps the State will take to ensure that students who receive a LEAP Grant under GAP persist to degree completion.

· An assurance that the State has a method in place, such as acceptance of the Title IV automatic zero EFC, to identify eligible low-income students and award State grant aid to such students.

· An assurance that the State will provide notification to eligible low-income students that grants under GAP are LEAP Grants and are funded by the Federal Government and the State, and, where applicable, other contributing partners. 

The State agency that submits an application for GAP must be the same agency that submits an application for LEAP.

A State agency must apply in partnership with:

· At least one public and one private degree-granting institution of higher education that are located in the State, if applicable;

· New or existing early information and intervention, mentoring, or outreach programs located in the State; and 

· At least one philanthropic organization located in, or that provides funding in, the State or private corporation located in, or that does business in, the State.

**Updated information since 3/2-4 meetings:**

**Tentative agreement:**

**Regulatory Language:**

See §692.94 on page 2 of Appendix A.

See §692.100 on pages 2-4 of Appendix A.

**Statutory Language:**

```
**(c)** Application for Allotment.--
```

```
**(1)** In general.--
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**(A)** Submission.--A State that desires to receive an allotment under this section on behalf of a partnership described in paragraph (3) shall submit an application to the Secretary at such time, in such manner, and containing such information as the Secretary may require.
```

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**(B)** Content.--An application submitted under subparagraph (A) shall include the following:
```

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**(i)** A description of the State's plan for using the allotted funds.
```

```
**(ii)** An assurance that the State will provide matching funds, in cash or in kind, from State, institutional, philanthropic, or private funds, of not less than 33.33 percent of the cost of carrying out the activities under subsection (d). The State shall specify the methods by which matching funds will be paid. A State that uses non-Federal funds to create or expand partnerships with entities described in subsection (a)(1), in which such entities match State funds for student scholarships, may apply such matching funds from such entities toward fulfilling the State's matching obligation under this clause.
```

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**(iii)** An assurance that the State will use funds provided under this section to supplement, and not supplant, Federal and State funds available for carrying out the activities under this title.
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**(iv)** An assurance that early information and intervention, mentoring, or outreach programs exist within the State or that there is a plan to make such programs widely available.
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**(v)** A description of the organizational structure that the State has in place to administer the activities under subsection (d), including a description of how the State will compile information on degree completion of students receiving grants under this section.
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**(vi)** A description of the steps the State will take to ensure that students who receive grants under this section persist to degree completion.
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**(vii)** An assurance that the State has a method in place, such as acceptance of the automatic zero expected family contribution determination described in section 479(c), to                       identify eligible low-income students and award State grant aid to such students.
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**(viii)** An assurance that the State will provide notification to eligible low-income students that grants under this section are--
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**(I)** Leveraging Educational Assistance Partnership Grants; and
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**(II)** funded by the Federal Government and the State, and, where applicable, other contributing partners.
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**(2)** State agency.--The State agency that submits an application for a State under section 415C(a) shall be the same State agency that submits an application under paragraph (1) for such State.
```

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**(3)** Partnership.--In applying for an allotment under this section, the State agency shall apply for the allotment in partnership with--
```

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**(A)** not less than one public and one private degree-granting institution of higher education that are located in the State, if applicable;
```

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**(B)** new or existing early information and intervention, mentoring, or outreach programs located in the State; and
```

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**(C)** not less than one--
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**(i)** philanthropic organization located in, or that provides funding in, the State; or
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**(ii)** private corporation located in, or that does business in, the State.
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**Issue Paper #28**
```

**Origin:**HEOA

**Issue:**GAP Allotment:  Determination

**Statutory cites:**Section 415E(b), 415E(g), and 415B of the HEA

**Regulatory cites:**§692.110

**DCL GEN-08-12 cite:**Page 111

**Summary of issue:** The Secretary makes an allotment to each State that submits an application to meet the costs of the Federal share of the State’s GAP program.

Under section 415(g) of the HEA, LEAP provisions that are not inconsistent with GAP program requirements apply to GAP.  Section 415B of the HEA sets forth the allotment formula for the subpart.

In making a continuation award for a State that continues to meet the specifications in the State’s approved application, the Secretary makes an allotment to the State that is not less than the allotment made to the State in the previous year.

The Secretary gives priority to a State that applies for an allotment in partnerships with degree-granting institutions whose combined full-time enrollment represents a majority of all students attending institutions of higher education in the State.

**Updated information since 3/2-4 meetings:**

**Tentative agreement:**

**Regulatory Language:**

See subpart B, §692.70 on page 1 of Appendix A.

See §692.110 on pages 4-5 of Appendix A.

**Statutory Language:**

```
**SEC. 4415E**
```

```
***  *  *  *  ***
```

```
**(b)** Allotments to States.--
```

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**(1)** In general.--
```

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**(A)** Authorization.--From sums reserved under section 415A(b)(2) for each fiscal year, the Secretary shall make an allotment to each State that submits an application for an allotment in accordance with subsection (c) to enable the State to pay the Federal share, as described in paragraph (2), of the cost of carrying out the activities under subsection (d).
```

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**(B)** Determination of allotment.--In making allotments under subparagraph (A), the Secretary shall consider the following:
```

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**(i)** Continuation of award.--If a State continues to meet the specifications established in such State's application under subsection (c), the Secretary shall make an allotment to such State that is not less than the allotment made to such State for the previous fiscal year.
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**(ii)** Priority.--The Secretary shall give priority in making allotments to States that meet the requirements described in paragraph (2)(B)(ii).
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**(2)** Federal share.—****
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**(A)**In general.--The Federal share of the cost of carrying out the activities under subsection (d) for any fiscal year shall not exceed 66.66 percent.
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**(B)** Different percentages.--The Federal share under this section shall be determined in accordance with the following:
```

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**(i)** The Federal share of the cost of carrying out the activities under subsection (d) shall be 57 percent if a State applies for an allotment under this section in partnership with any number of degree-granting institutions of higher education in the State whose combined full-time enrollment represents less than a majority of all students attending institutions of higher education in the State, and--
```

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**(I)** philanthropic organizations that are located in, or that provide funding in, the State; or
```

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**(II)** private corporations that are located in, or that do business in, the State.
```

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**(ii)** The Federal share of the cost of carrying out the activities under subsection (d) shall be 66.66 percent if a State applies for an allotment under this section in partnership with any number of degree-granting institutions of higher education in the State whose combined full-time enrollment represents a majority of all students attending institutions of higher education in the State, and--
```

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**(I)** philanthropic organizations that are located in, or that provide funding in, the State; or
```

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**(II)** private corporations that are located in, or that do business in, the State.
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**(C)** Non-federal share.--
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**(i)** In general.--The non-Federal share under this section may be provided in cash or in kind, fairly evaluated.
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**(ii)** In-kind contribution.--For the purpose of calculating the non-Federal share under this subparagraph, an in-kind contribution is a non-cash contribution that--
```

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**(I)** has monetary value, such as the provision of--
```

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**(aa)** room and board; or
```

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**(bb)** transportation passes; and
```

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**(II)** helps a student meet the cost of attendance at an institution of higher education.
```

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**(iii)** Effect on need analysis.--For the purpose of calculating a student's need in                       accordance with part F, an in-kind contribution described in clause (ii) shall not be considered an asset or income of the student or the student's parent.
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*  *  *  *  *
```

**(g)**APPLICABILITY RULE.—The provisions of this subpart that are not inconsistent with this section shall apply to the program authorized by this section.

**SEC. 415B. [20 U.S.C. 1070c–1] ALLOTMENT AMONG STATES.**

**(a) ALLOTMENT BASED ON NUMBER OF ELIGIBLE STUDENTS IN ATTENDANCE.—**

**(1)** From the sums appropriated pursuant to section 415A(b)(1) and not reserved under section 415A(b)(2) for any fiscal year, the Secretary shall allot to each State an amount which bears the same ratio to such sums as the number of students who are deemed eligible in such State for participation in the grant program authorized by this subpart bears to the total number of such students in all the States, except that no State shall receive less than the State received for fiscal year 1979.

**(2)** For the purpose of this subsection, the number of students who are deemed eligible in a State for participation in the grant program authorized by this subpart, and the number of such students in all the States, shall be determined for the most recent year for which satisfactory data are available.

**(b)** REALLOTMENT.—The amount of any State’s allotment under subsection (a) for any fiscal year which the Secretary determines will not be required for such fiscal year for the leveraging educational assistance partnership program of that State shall be available for reallotment from time to time, on such dates during such year as the Secretary may fix, to other States in proportion to the original allotments to such States under such part for such year, but with such proportionate amount for any of such States being reduced to the extent it exceeds the sum the Secretary estimates such State needs and will be able to use for such year for carrying out the State plan. The total of such reductions shall be similarly reallotted among the States whose proportionate amounts were not so reduced.  Any amount reallotted to a State under this part during a year from funds appropriated pursuant to section 415A(b)(1) shall be deemed part of its allotment under subsection (a) for such year.

**(c)** ALLOTMENTS SUBJECT TO CONTINUING COMPLIANCE.—The Secretary shall make payments for continuing incentive grants only to States which continue to meet the requirements of section 415C(b).

**Issue Paper #29**

**Origin:**HEOA

**Issue:**Matching

**Statutory cites:**415E(b)(2), (h), and (i) of the HEA

**Regulatory cites:**§692.113

**DCL GEN-08-12 cite:**Pages 111-112

**Summary of issue:**

##### Matching funds

A State may provide the non-Federal share in cash or in-kind, fairly evaluated.  An in-kind contribution is a noncash contribution that has monetary value, such as the provision of room and board or transportation passes, and helps a student meet the cost of attendance at an institution of higher education. 

###### Non-Federal share

The Federal share of the program costs may not exceed 66.66 percent. 

The Federal share of the program costs in a State is 57 percent in the case of a State that is in partnership with degree-granting institutions of higher education in the State whose combined fulltime enrollment represents *less than a majority*of all students attending institutions in the State and with philanthropic organizations that are located in, or that provide funding in, the State or private corporations that are located in, or that do business in, the State. 

The Federal share of the program costs in a State is 66.66 percent in the case of a State that is in partnership with degree-granting institutions of higher education in the State whose combined full-time enrollment represents *a majority*of all students attending institutions in the State and with philanthropic organizations that are located in, or that provide funding in, the State or private corporations that are located in, or that do business in, the State.

###### Maintenance-of-effort requirement

Each State receiving a GAP allotment for a fiscal year must provide the Secretary with an assurance that the aggregate amount expended per student or the aggregate expenditures by the State, from funds derived from non-Federal sources, for activities authorized for GAP for the preceding fiscal year were not less than the amount expended per student or the aggregate expenditure by the State for the activities for the second preceding fiscal year.

###### Base-year requirement

Notwithstanding the maintenance-of-effort requirement, for purposes of determining a State’s share of the cost of the GAP program activities, the State must consider only those expenditures from non-Federal sources that exceed the State’s total expenditures for need-based grants, scholarships, and work-study assistance for fiscal year 1999 (including any such assistance provided under LEAP and GAP).

**Updated information since 3/2-4 meetings:**

**Tentative agreement:**

**Regulatory Language:**

See §692.113 on pages 7-8 of Appendix A.

**Statutory Language:**

**(b) *  *  ***

**(2)**FEDERAL SHARE.—

**(A)**IN GENERAL.—The Federal share of the cost of carrying out the activities under subsection (d) for any fiscal year shall not exceed 66.66 percent.

**(B)**DIFFERENT PERCENTAGES.—The Federal share under this section shall be determined in accordance with the following:

**(i)**The Federal share of the cost of carrying out the activities under subsection (d) shall be 57 percent if a State applies for an allotment under this section in partnership with any number of degree-granting institutions of higher education in the State whose combined full-time enrollment represents less than a majority of all students attending institutions of higher education in the State, and—

**(I)**philanthropic organizations that are located in, or that provide funding in, the State; or

**(II)**private corporations that are located in, or that do business in, the State.

**(ii)**The Federal share of the cost of carrying out the activities under subsection (d) shall be 66.66 percent if a State applies for an allotment under this section in partnership with any number of degree-granting institutions of higher education in the State whose combined full-time enrollment represents a majority of all students attending institutions of higher education in the State, and—

**(I)**philanthropic organizations that are located in, or that provide funding in, the State; or

**(II)**private corporations that are located in, or that do business in, the State.

**(C)**NON-FEDERAL SHARE.—

**(i)**IN GENERAL.—The non-Federal share under this section may be provided in cash or in kind, fairly evaluated.

**(ii)**IN-KIND CONTRIBUTION.—For the purpose of calculating the non-Federal share under this subparagraph, an in-kind contribution is a non-cash contribution that—

**(I)**has monetary value, such as the provision of—

**(aa)**room and board; or

**(bb)**transportation passes; and

**(II)**helps a student meet the cost of attendance at an institution of higher education.

**(iii)**EFFECT ON NEED ANALYSIS.—For the purpose of calculating a student’s need in accordance with part F, an in-kind contribution described in clause (ii) shall not be considered an asset or income of the student or the student’s parent.

*  *  *  *  *

**(h)**MAINTENANCE OF EFFORT REQUIREMENT.—Each State receiving an allotment under this section for a fiscal year shall provide the Secretary with an assurance that the aggregate amount expended per student or the aggregate expenditures by the State, from funds derived from non-Federal sources, for the authorized activities described in subsection (d) for the preceding fiscal year were not less than the amount expended per student or the aggregate expenditure by the State for the activities for the second preceding fiscal year.

**(i)**SPECIAL RULE.—Notwithstanding subsection (h), for purposes of determining a State’s share of the cost of the authorized activities described in subsection (d), the State shall consider only those expenditures from non-Federal sources that exceed the State’s total expenditures for need-based grants, scholarships, and work-study assistance for fiscal year 1999 (including any such assistance provided under this subpart).

**Issue Paper #30**

**Origin:**HEOA

**Issue:**Statutory and regulatory relief

**Statutory cites:**415E(f) of the HEA

**Regulatory cites:**§692.130

**DCL GEN-08-12 cite:**Page 115

**Summary of issue:**The Secretary may grant, upon the request of an institution of higher education that is in a partnership with a 66.66 percent Federal share, a waiver for such institution from statutory or regulatory requirements that inhibit the ability of the institution to successfully and efficiently participate in the activities of the partnership.

**Updated information since 3/2-4 meetings:**

**Tentative agreement:**

**Regulatory Language:**

See §692.130 on page 9 of Appendix A.

**Statutory Language:**

**(f)**STATUTORY AND REGULATORY RELIEF FOR INSTITUTIONS OF HIGHER EDUCATION.—The Secretary may grant, upon the request of an institution of higher education that is in a partnership described in subsection  (b)(2)(B)(ii) and that receives an allotment under this section, a waiver for such institution from statutory or regulatory requirements that inhibit the ability of the institution to successfully and efficiently participate in the activities of the partnership.

**Issue Paper #31**

**Origin:**HEOA

**Issue:**Estimated financial assistance

**Statutory cites:**415E(b)(2)(C)(iii) of the HEA

**Regulatory cites:**None

**DCL GEN-08-12 cite:**Page 112

**Summary of issue:**For purposes of calculating a student’s need in accordance with title IV, part F of the HEA, an in-kind contribution is not considered an asset or income of the student or the student’s parent.

**Updated information since 3/2-4 meetings:**

**Tentative agreement:**

**Regulatory Language:**

None.

**Statutory Language:**

**(iii)**EFFECT ON NEED ANALYSIS.—For the purpose of calculating a student’s need in accordance with part F, an in-kind contribution described in clause (ii) shall not be considered an asset or income of the student or the student’s parent.

208