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Summary of Part 686 – TEACH Grants

Subpart A – Scope, Purpose, and General Definitions

§ 686.1 Scope and purpose.

 Revise the description of the TEACH Grant Program to clarify that grant recipients can satisfy the 

service obligation by teaching for an educational service agency serving low-income students. In 

addition, as a result of the change to the definition of school in 668.2, this regulation would also 

provide that grant recipients can satisfy their teaching obligation by teaching at a private school 

serving low-income students.

 Clarify that the eight-year period for completing the service obligation begins when the grant 

recipient ceases enrollment at the institution where he or she received a TEACH Grant unless he 

or she subsequently reenrolled in a TEACH grant eligible program before his or her grant 

converted or he or she received a service clock suspension. This is for consistency with existing 

regulatory language elsewhere in Part 686 and with current operational practice. Make 

conforming changes where needed in other sections of the regulations. 

 Clarify that loans can be reconverted to grants through the reconsideration process.

 Change the reference to Direct Unsubsidized Loans to match the terminology used in the Direct 

Loan Program regulations. Make conforming changes in other sections of the TEACH Grant 

regulations. 

§ 686.2 Definitions.

 Add a definition of the term “educational service agency” to reflect a statutory change that 

allows grant recipients to satisfy the TEACH Grant service obligation by teaching for an 

educational service agency serving low-income students. 

 Remove an unnecessary cross-reference to the FFEL Program targeted teacher deferment 

regulations in the definition of the term “high-need field.”

 Revise the definition of the term “highly-qualified”—

o For clarity, replace the existing cross-reference to the Elementary and Secondary 

Education Act of 1965 (ESEA) with the full text of the definition from the ESEA; and

o For consistency with the “highly-qualified” definition used for purposes of the Direct 

Loan Teacher Loan Forgiveness Program, added language to cover private school 

teachers. 

 Revise the definition of the term “school serving low-income students (low-income school)” 

by—

o Clarifying that this term includes educational service agencies serving low-income 

students;

o Updating the name of the Department’s directory of low-income schools; 

o Simplifying the definition of "low-income school" by removing unnecessary text that 

explains the criteria for inclusion of a school or educational service agency in the 

Department's Teacher Cancellation Low-Income (TCLI) Directory, retaining only the 

requirement that the school or educational service agency must be listed in the TCLI

Directory; and

o Adding language (currently in a different section of the TEACH Grant regulations) 

explaining the conditions under which teaching at a school or educational service 

agency that no longer qualifies as a low-income school may satisfy the TEACH Grant 

service obligation.
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Subpart B—Application Procedures

§686.10 Application.

 Replace the current references to submitting an "application" for a TEACH Grant with references 

to the Free Application for Federal Student Aid (FAFSA), because there is no separate TEACH 

Grant application. Make conforming changes elsewhere in the regulations. 

 Allow institutions to require that students provide additional information prior to determining 

whether the student should receive a TEACH grant. 

§686.12 Agreement to serve.

 Change the title of the section to “Agreement to serve and repay,” to emphasize that a grant 

recipient must either perform the service obligation or repay the grant as a loan. Make 

conforming changes elsewhere. 

 Add to the agreement a requirement that the following must be explained:

o Periods of suspension;

o The conditions under which a TEACH Grant may be converted to a Direct Unsubsidized 

Loan;

o The retroactive accrual of interest should a TEACH Grant convert to loan; and

o The option to voluntarily convert a TEACH Grant to a Direct Unsubsidized Loan to avoid 

further interest accrual should the recipient no longer intend to fulfill the service 

requirement.

 Add a requirement for the grant recipient to promptly notify the Secretary of any changes of 

name, address, telephone number, or e-mail address, if the recipient has provided the Secretary 

with an e-mail address for receiving communications. This incorporates into the regulations

language that is currently in the Agreement to Serve (ATS).

 Add language to address the treatment of grant recipients who withdraw from the institution 

where they received a TEACH Grant before completing the TEACH Grant-eligible program, then 

at a later date re-enroll in the same program, or in a different TEACH Grant-eligible program at 

the same academic level (undergraduate or graduate) as the prior program, at either the same 

school or a different school, and receive additional TEACH Grants. Specifically—

o Provide that in the situation described above, the grant recipient must complete one 

service obligation for all grants received at the same academic level. This incorporates 

into the regulations current operational procedures for handling such situations.

o Provide that except in cases when a grant recipient completed one or more years of 

qualifying teaching during the period between withdrawal and reenrollment, if the 

recipient requests service obligation starting date change, Secretary will adjust the 

starting date of the period for completing the service obligation to begin when the grant 

recipient ceases to be enrolled at the institution where he or she has re-enrolled. 

o Provide that for a grant recipient who completed one or more complete academic years 

of creditable teaching service during the period between the grant recipient’s 

withdrawal and re-enrollment, the Secretary does not adjust the starting date of the 

period for completing the service obligation and applies the completed teaching service 

toward satisfaction of the grant recipient's service obligation. If the grant recipient 

continues to perform creditable teaching service after re-enrolling in a TEACH Granteligible program, the grant recipient may receive credit toward satisfaction of the 

service obligation for any complete academic years of creditable teaching performed 
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while the recipient is concurrently enrolled in the TEACH Grant-eligible program only if 

the recipient does not request and receive a temporary suspension of the period for 

completing the service obligation.

 Clarify that the requirements for "majoring and serving in a high-need field," are specific to

teaching in a high-need field listed for each state in the Nationwide List.

 To reflect a statutory change, provide that to meet the teaching service obligation by teaching in

a high-need field listed in the Nationwide List, the field must be listed in the Nationwide List for

the State in which the grant recipient teaches at the time the recipient begins teaching in that

field, even if that field subsequently loses its high-need designation for that State; or for

teaching service performed on or after July 1, 2010, at the time the grant recipient begins

teaching in that field or when the grant recipient signed the agreement to serve or received the

TEACH Grant, even if that field subsequently loses its high-need designation for that State

before the grant recipient begins teaching. Conforming changes were also made.



Subpart C—Determination of Awards

§686.21 Calculation of a grant.

 Replaced the word “aggregate” with the word “total” and the word “master’s” with the words

“graduate study” to be consistent with statutory language.

Subpart D—Administration of Grant Payments

§686.32 Counseling requirements.

 Add to initial and exit counseling a requirement that the grant recipient must be informed that,

in order for teaching in a high-need field listed in the Nationwide List to count towards the

recipient's service obligation, the high-need field must be listed in the Nationwide List for the

State in which the grant recipient teaches at the time the recipient begins teaching in that field,

even if that field subsequently loses its high-need designation for that State; or, for teaching

service performed on or after July 1, 2010, the field must have been listed in the Nationwide List

at the time the grant recipient signed the agreement to serve or received the TEACH Grant

associated with the service obligation for which the teaching service is going to be performed,

even if that field subsequently loses its high-need designation for that State before the grant

recipient begins teaching in that field.

 Add to initial, subsequent, and exit counseling a requirement to explain to the grant recipient

that once a TEACH Grant is converted to a Direct Unsubsidized Loan it cannot be reconverted to

a grant unless the grant has been determined by the Secretary to be converted to a loan in error

or the recipient is able to provide within one year of conversation documentation showing

he/she fully satisfied the service obligation within the eight-year service obligation period.

 Add to initial, subsequent, and exit counseling a requirement to explain the option to voluntarily

convert a TEACH Grant to a Direct Unsubsidized Loan to avoid further interest accrual should the

recipient no longer intend to fulfill the service requirement.

 Add to exit counseling a requirement to explain the treatment of a grant recipient who

withdraws from then reenrolls in a TEACH-eligible program as modified in §686.12(c).
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 Add to the exit counseling a requirement to explain that the Department will provide the 

recipient with an annual notice of how many years of service the Department has accepted and 

how many years the recipient still has to complete their service requirement. 

 Add language to the exit counseling requirements to reflect that the Secretary will regularly 

remind the recipient of the requirements that must be met to satisfy the service obligation, and 

of the timeframe within which the recipient must complete the service obligation.

 Add language to create conversion counseling requirements that the Secretary will provide to 

TEACH grant recipients at the time their grant converts to a loan. Conversion counseling will 

include an estimated monthly repayment amount and an explanation of the interest accrued on 

the loan, available repayment plan options, available loan forgiveness programs, and other 

important loan repayment information. The conversion counseling will also include information 

regarding the reconsideration process for a converted TEACH Grant.

 NOTE: Due to oversight, committee did not add requirement to exit counseling that service 

years completed at a school that was low-income when the TEACH grant recipient began 

teaching, but subsequently lost its low-income status will still count towards the TEACH grant 

recipient’s service obligation. 

Subpart E—Service and Repayment Obligations

§686.40 Documenting the service obligation.

 Remove the requirement for grant recipients to notify the Secretary within 120 days of 

completing or otherwise ceasing enrollment in a program of study for which a TEACH Grant was 

received that they are performing qualifying teaching service, or that they are not yet teaching, 

but intend to satisfy the service obligation. This requirement is no longer needed due to changes 

in proposed §686.43.

 Remove language that relates to the determination of whether a school or educational service 

agency qualifies as a low-income school and move it to the definition of “school or educational 

service agency serving low-income students (low-income school)”.

 Remove language explaining that a grant recipient cannot satisfy the requirement to teach in a 

high-need field by teaching in a geographic region of a State that has been designated in the 

Nationwide List as having a shortage of elementary or secondary school teachers, or by teaching 

in a specific grade level not associated with a specific high-need field that has been designated 

in the Nationwide List as having a shortage of teachers.

 Remove redundant language related to the high-need field requirement and replace with a 

cross-reference to where the high-need field requirement is explained.

 Add “residing in or being employed in a federally declared major disaster area as defined in the 

Robert T. Stafford Disaster Relief and Emergency Assistance Act (42 U.S.C. 5122(2))” as a new 

circumstance that would allow less than a full year of teaching to be counted as one of a grant 

recipient’s required four complete elementary or secondary years of teaching.

 Clarify that service years completed at a school that was low-income when the TEACH grant 

recipient began teaching, but subsequently lost its low-income status will still count towards the 

TEACH grant recipient’s service obligation. 
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§686.41 Periods of suspension.

 Add “enrollment in a course, or otherwise fulfilling requirements for licensure in a State” as an 

additional basis for a grant recipient to request a temporary suspension of the period for 

completing the service obligation so that a recipient could complete enrollment in a program of 

study to meet certification or licensure requirements or complete provisional certification 

requirements needed to obtain full certification to teach in their state. 

 Add language for spousal relocation due to military orders or change in permanent station as an 

additional basis for a grant recipient to request a temporary suspension of the period for 

completing the service obligation.

 Add “residing in or being employed in a federally declared major disaster area as defined in the 

Robert T. Stafford Disaster Relief and Emergency Assistance Act (42 U.S.C. 5122(2))” as an 

additional basis for a grant recipient to request a temporary suspension of the period for 

completing the service obligation. Provide for a separate 3-year limit for this suspension, and 

allow for a representative to submit a request for a disaster suspension on the grant recipient's 

behalf.

 Add language allowing the Secretary to grant a temporary period of suspension on a case-bycase basis in the event the Secretary determines a grant recipient was unable to complete a full 

academic year of teaching or begin the next academic year due to exceptional circumstances 

either significantly affecting the operation of the school or the recipient’s ability to teach. 

 The subcommittee agreed that a three-year cap on all combined suspensions was likely too 

short, but was divided on what the appropriate maximum suspension period should be.

§686.42 Discharge of agreement to serve.

 Amend the regulations related to total and permanent disability to reflect the current 

procedures for discharging a TEACH Grant service obligation based on the grant recipient's total 

and permanent disability. The existing regulatory language is obsolete.

 For consistency with existing military suspension language, add “a reserve component of the 

Armed Forces named in 10 U.S.C. 10101, or the National Guard” to the meaning of Armed 

Forces.

§686.43 Obligation to repay the grant.

 Simplify the regulations that specify the conditions under which TEACH Grants are converted to 

loans to provide that, for all recipients, loan conversion will occur only if the grant recipient asks 

the Secretary to convert his or her TEACH Grants to loans, or the recipient fails to begin or 

maintain qualifying teaching service within a timeframe that would allow the recipient to satisfy 

the service obligation within the 8-year period. 

 Add language stating that the Secretary will provide recipients with information about the 

service obligation requirements at least annually during the service obligation period. The 

notification will contain 

o A disclosure of the service years that the recipient has completed;

o A disclosure of the remaining years left in the service obligation period;

o An explanation of the option to voluntarily convert a TEACH Grant to a Direct 

Unsubsidized Loan to avoid further interest accrual should the recipient no longer 

intend to fulfill the service requirement; and

o Information regarding the reconsideration process for a converted TEACH Grant.

 Add language stating that the Secretary will provide recipients with a notification of pending 

conversion on or about 90 days prior to the date that a grant recipient’s TEACH Grants would be 
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converted to Direct Unsubsidized Loan(s). The notification will include associated 

documentation deadlines for a recipient to demonstrate he/she has satisfied or intends to 

satisfy the service obligation. 

 Add language to allow for reconversion of a TEACH Grant from a Direct Unsubsidized Loan 

should the recipient demonstrate he or she is satisfying the service obligation within one year of 

conversation. 

 Add language to outline the process by which a recipient may request reconsideration of the 

conversion if they believe that the grants were converted in error. Add language to ensure any 

qualifying service completed during the time of the reconsideration would be counted toward 

satisfaction of the service obligation and that the reconsideration period will be considered a 

period of suspension should the recipient not complete qualifying service during the 

reconsideration period. 

 Add language to outline the remedies a TEACH grant recipient will receive should their grant be 

converted in error. 

 Provide that a recipient remains obligated to meet all service obligation requirements even if 

the recipient does not receive the notices from the Secretary previously described in this 

section.

 Add language stating that the Secretary will notify a grant recipient who has requested 

conversion reconsideration whether the request is approved or denied. If denied, add language 

to require the Secretary to explain the reason or reasons the loan cannot be reconverted and 

how the recipient may contact the FSA Ombudsman. 

 The subcommittee agreed that there should be a clear grant to loan reconsideration process, 

but disagreed as to whether a written appeal process should be available for decisions related to 

service year forms, requests for suspension, and requests for service year discharge.