TEACH Grant 

2019 Negotiated 

Rulemaking 

Subcommittee Report

KYRA TAYLOR, PROJECT ON PREDATORY STUDENT LENDING 

AT HARVARD LAW SCHOOL LEGAL SERVICES CENTER

STEPHEN PAYNE, NATIONAL ASSOCIATION OF STUDENT 

FINANCIAL AID ADMINISTRATORS
TEACH Grants’ 

Purpose: 

Get Highly-Qualified

Teachers in HighNeed Fields in LowIncome Schools. 

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Completed or 

Ceased 

Enrollment in 

TEACH GrantEligible 

Program

1

TEACH Grant Eligibility Under the HEA

20 U.S.C. § 1070g 

Year Year Year Year Year Year Year Year

2 3 4 5 6 7 8

Rules teacher must follow to stay in grant 

status:

1) Retain “highly-qualified” teacher status; 

2) Use grant for TEACH grant eligible higher 

education program; 

3) Teach for 4** years: 

a) In high-need field

b) In low-income school 

c) Within 8 years of completing 

program recipient received TEACH 

grant for.

**= 4 years does not need to be sequential

Conversion Authorized by Statute Only If 

recipient failed to complete service AND has not 

requested a service clock suspension or demonstrated 

need for a service year discharge AND has not 

requested voluntary conversion. 

Year 5 is the first year conversion is permitted 

by statute–but only for recipients who have 

not completed any service years and have 

no basis for service suspension or discharge

CONVERSION TO LOAN
TEACH Grant Eligibility Under the HEA

20 U.S.C. § 1070g 

Department has discretion to suspend 8 year 

service fulfillment period 

or 

discharge years of required service 

where there are “exceptional circumstances.”

Completed or 

Ceased 

Enrollment in 

TEACH GrantEligible 

Program

1

Year Year Year Year Year Year Year Year

2 3 Period of suspension 4 5 4 5 ...
Conversion Triggers 

Under Current 24 CFR 686.43 

Notify ED within

120 days of 

either: 

1) Leaving 

TEACH-grant 

eligible 

program; OR

2) Graduating 

and a) entering 

service-eligible 

employment or 

b) Intending to 

complete service 

Certify within 

1 year of 

graduating 

that: 

entered 

qualifying 

employment 

OR 

Intend to 

complete 

service

Certify each year (before 

deadline set by servicer) 

that: 

1) Completed qualifying 

service year 

Or

2) Intend to fulfill service

No certification 

form

(or form w/ 

mistakes) by 

deadline?

Completed or 

Ceased 

Enrollment in 

TEACH GrantEligible 

Program

1

Year Year Year Year Year Year Year Year

2 3 4 5 6 7 8

CONVERT TO LOAN
Summary of Changes Proposed

1.Grant-to-loan conversion triggered only by the 

impossibility of completing service within 8 year period.

3. Increased intentionality of counseling and 

notifications to recipients

4. Expanded eligibility for service-clock suspension and 

service year discharge. 

5. Conversion reconsideration.* 

2. Increased opportunity to complete service. 
1. Grant-to-loan conversion triggered by the 

impossibility of completing service (686.43) 

No certification forms 

submitted? AND no 

longer able to 

complete service in 8-

yr window (no earlier 

than year 5)

CONVERT TO LOAN*

Asked to complete service 

certification each year.

Completed or 

Ceased 

Enrollment in 

TEACH GrantEligible 

Program

1

Year Year Year Year Year Year Year Year

2 3 4 5 6 7 8

Proposed Change: 

Allow TEACH Grant 

recipients to 

demonstrate inability 

to complete service 

before conversion.

*1 yr period to request reconsideration of conversion
1. Grant-to-Loan Conversion Triggered By 

The Impossibility Of Completing Service 

Within 8 Years (changes to 686.43) 

Proposed Change To Paperwork Process:

1) Recipients will be encouraged to submit service-year paperwork 

immediately after conclusion of each school year. 

2) Service-year paperwork will be accepted up to grant to loan 

conversion. 

3) Recipients will be permitted to submit evidence of service year 

completion when requesting reconsideration of their grant to loan 

conversion. 
2. Increased opportunity to complete 

service (changes to 686.12 and 686.40)

Proposed Changes: 

A) Include all teacher shortage areas listed as teacher-shortage 

areas for each state. 

B) Allow TEACH recipient to fulfill service requirement by teaching in 

a field that was high-need when the recipient signed their 

Agreement to Serve or Repay but subsequently lost that distinction.

C) Make it easier for transfer students or students who withdraw to 

complete service. 
2. Increased opportunity to complete 

service (changes to 686.12 and 686.40)

20 states and DC (highlighted in purple) list 

general education fields in elementary, 

middle, or high schools as “Teacher 

Shortage Areas” in 2017-18 or 2018-19.

Proposed Change A: 

Using authority in 

statute, include all 

teacher shortage 

areas listed on the 

Nationwide Teacher 

Shortage Area list for 

each state, 

including general 

education fields.
2. Increased opportunity to complete 

service (changes to 686.12)

Allow teachers to 

stay in their 

field/school

despite changing 

status—

No “chasing the 

grant.”

Note: Regulations 

already allow TEACH 

recipient to fulfill 

service requirement by 

teaching in a school 

that was low-income 

when the teacher 

began teaching, but 

subsequently lost that 

distinction.

Proposed Change B: 

Allow recipient to fulfill 

service requirement by 

teaching in a field that 

was high-need when 

the recipient signed 

their Agreement to 

Serve or Repay or 

began teaching but 

subsequently lost that 

distinction.
TEACH Grant-Eligible 

Education Program

2. Increased opportunity to complete service 

(changes to 686.12).

Year Year Year TEACH Grant-Eligible 

Education Program

Recipient withdraws; 

service clock begins.

Recipient completes 

program; 8 year clock 

begins again.

1 2 ...

Proposed Change C: The 8-year period for recipients to 

complete their service, if they withdrew and reenrolled, 

begins when they cease enrollment at new TEACH-eligible 

higher education program.

Year Year

1 2
3. Increased Clarity of Information Related 

To the TEACH grant (Changes to 686.12, 

686.32, and 686.43).

Proposed Changes: 

A) Improve Agreement to Serve or Repay, entrance counseling, and 

exit counseling.

B) Implement annual notifications of remaining time to complete 

service and service years accepted by Department. 

C) Implement pre-conversion notification for TEACH grant recipients.

D) Implement conversion notification and conversion counseling to 

assist recipients with their new loans. 
3. Increased Information Transparency Regarding 

TEACH Grant Recipients’ Service Completion 

Status (Changes to 686.12 and 686.32).

1. Changing 

“Agreement to 

Serve” 

to “Agreement to 

Serve or Repay” 

2. Adding 

information 

about voluntary 

conversion to 

prevent interest 

accrual 

3. Making 

recipient aware 

that a 

reconsideration 

process exists 

should their grant 

be converted to 

a loan.

Proposed Change A: Improve Agreement to Serve or 

Repay, entrance counseling, and exit counseling.
3. Increased Information Transparency Regarding 

TEACH Grant Recipients’ Service Completion Status 

(Changes to 686.43)

1 2 3 4 5 6 7 8

Each year, the Department will notify the recipient: 

1) How many service years have been accepted by the 

Department;

2) How many years remain to complete the service req.;

3) How to request a service-clock suspension; and

4) Potential interest accrual should the grant convert.

Proposed Change B: Implement annual notification of 

remaining time and service years accepted by Department. 
3. Increased Information Transparency Regarding 

TEACH Grant Recipients’ Service Completion Status 

(Changes to 686.43)

At or about 90 days prior to loan 

conversion, the Department will 

notify recipient that they must 

submit documentation or their 

grant will convert to a loan on 

the specified date. 

Proposed Change C: Implement pre-conversion notification 

for TEACH grant recipients.
3. Increased Information Transparency Regarding 

TEACH Grant Recipients’ Service Completion Status 

(Changes to 686.32).

After a grant converts to a loan, the 

Department will notify the recipient that 

conversion has occurred and provide 

the recipient with counseling (similar to 

loan exit counseling) to increase 

awareness of repayment options. 

Proposed Change D: Implement conversion notification and 

conversion counseling to assist recipients with their new 

loans. 
TEACH GrantEligible 

Education 

Program 1

Proposed Touch-Points of Information 

During TEACH Grant Process

Year Year Year Year Year Year Year Year

2 3 4 5 6 7 8

Entrance

Counseling 

and ATSR

Exit 

Counseling

Annual 

Notification

Annual 

Notification

Annual 

Notification

Annual 

Notification

Annual 

Notification

90-120 Day

Pre-conversion

Notification

Grant to Loan

Conversion

Counseling

C

O

N

V

E

R

S

I

O

N

Subsequent

Counseling 

(if applicable)
4. Expanded eligibility for Service-Clock 

Suspension and Service Year Discharge 

(Changes to 686.41 and 686.42)

Proposed Changes:

A) Include residing in a federally declared disaster zone as a basis for 

both suspension and service-year discharge;

B) Include military spouse specific suspension allowances;

C) Include state-certification process as basis for suspension;

D) Allow Secretary to make case-by-case determinations for suspensions 

due to “exceptional circumstances significantly affecting the operation 

of the school or educational service agency where a grant recipient was 

employed or the grant recipient’s ability to teach.” 
4. Expanded eligibility for Service-Clock 

Suspension and Service Year Discharge 

(Changes to 686.41 and 686.42)

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Proposed Change A: Include residing in a federally 

declared disaster zone as a basis for both suspension and 

service-year discharge. 
4. Expanded eligibility for Service-Clock 

Suspension and Service Year Discharge 

(Changes to 686.41 and 686.42)

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Proposed Change B: 

Include military spouse 

specific suspension 

allowances, including: 

1. Permanent change of 

duty station and

2. Spouse’s deployment. 
4. Expanded eligibility for Service-Clock 

Suspension and Service Year Discharge 

(Changes to 686.41 and 686.42)

Initial provisional certification can take months. 

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Proposed Change C: Include state-certification process as 

basis for suspension. 
4. Expanded eligibility for Service-Clock 

Suspension and Service Year Discharge 

(Changes to 686.41 and 686.42)

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Proposed Change D: Allow 

Secretary to make case-by-case 

determinations for suspensions 

due to “exceptional 

circumstances significantly 

affecting the operation of the 

school or educational service 

agency where a grant recipient 

was employed or the grant 

recipient’s ability to teach.” 
2 Proposals for Reconsideration of Conversions from Grant 

to Loan: 

Proposal 1: Allow formal grant-to-loan reconsideration 

process within 1 year of grant conversion. 

Proposal 2: Allow a formal reconsideration process for: 

A) Grant-to-Loan conversion with heightened protections 

(within 1 year of grant conversion);

B) Service Form Determinations; 

C) Suspension Requests;

D) Service Year Discharge Requests. 

5. The Reconsideration Process for Grants 

Converted To Loans
5. The Reconsideration Process for Grants 

Converted To Loans

Proposal 1:

Allow recipients to request reconsideration of grant-toloan conversion within 1 year.

If the Request is approved, the Department will:

1. Suspend the service-clock for time spent in loan 

status (or count service, if applicable);

2. Issue credit/refund for payments made on grant 

while in loan status; and

3. Notify the recipient of the decision. 
5. The Reconsideration Process

Proposal 2 (pt. 1):

Allow recipients to request reconsideration of grant-to-loan conversion 

within 1 year. 

During reconsideration process, loan will:

1. Be put in deferment status; and

2. Not accrue interest.

If the request is approved, the Department will: 

1. Suspend the service-clock for time spent in loan status;

2. Issue credit/refund for payments while in loan status; 

3. Fix credit reporting. 
5. The Reconsideration Process for Grants 

Converted To Loans

Why?

1. Difficulty of defining 

qualifying teaching 

positions as high-need 

fields.

2. History of Servicer error.

3. Proximity to decision 

allows for certainty for 

teacher. Plus allows for 

teacher to easily collect 

necessary 

documentation. 

Proposal 2 (pt. 2):

Allow recipients to appeal 

rejections of service year 

certification, suspension 

requests, and service year 

discharge requests through a 

written appeal process.
TEACH Grants’ 

Purpose: 

Get Highly-Qualified

Teachers in HighNeed Fields in LowIncome Schools. 

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