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DRAFT for discussion at 3rd meeting

4/28/2009

Issue 3

Proposed Regulatory Language

Team II – School-based Loan Issues

Origin: HEOA section 1011

Issue: Disclosures of Reimbursements for 

Service on Advisory Boards

Statutory cites: HEA section 485(m)

Regulatory cites: New §668.16(d)

DCL GEN-08-12 cite: Page 102

Status: Tentative agreement reached

Regulatory language:

§ 668.16 Standards of administrative capability.

To begin and to continue to participate in any Title 

IV, HEA program, an institution shall demonstrate to the 

Secretary that the institution is capable of adequately 

administering that program under each of the standards 

established in this section. The Secretary considers an 

institution to have that administrative capability if the 

institution—
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DRAFT for discussion at 3rd meeting

4/28/2009

(a) Administers the Title IV, HEA programs in 

accordance with all statutory provisions of or applicable 

to Title IV of the HEA, all applicable regulatory 

provisions prescribed under that statutory authority, and 

all applicable special arrangements, agreements, and 

limitations entered into under the authority of statutes 

applicable to Title IV of the HEA;

* * * * *

(d)(1) Establishes and maintains records required 

under this part and the individual Title IV, HEA program 

regulations; and

(2) (A) (i) Reports annually to the Secretary on any 

reasonable reimbursements paid or provided by a private 

education lender or group of lenders as described under 

section 140(d) of the Truth in Lending Act (15 U.S.C. 1631) 

to any employee who is employed in the financial aid office 

of the institution or who otherwise has responsibilities 

with respect to education loans or other financial aid of 

the institution, including--

(i) (A) The amount for each specific instance of 

reasonable expenses paid or provided;
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DRAFT for discussion at 3rd meeting

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(ii) (B) The name of the financial aid official, 

other employee, or agent to whom the expenses were paid or 

provided;

(iii) (C) The dates of the activity for which the 

expenses were paid or provided; and

(iv) (D) A brief description of the activity for which 

the expenses were paid or provided.

(B) (ii) The expenses Expenses are considered to be 

reasonable if the expenses—-

(i)(A) Meet the standards of and are paid in 

accordance with a State government reimbursement policy

applicable to the entity; or

(ii)(B) Meet the standards of and are paid in 

accordance with the applicable Federal cost principles for 

reimbursement, if no State policy exists that is applicable 

to the entity exists.

(iii) The policy must be consistently applied to an

institution’s employees.

* * * * *

(Approved by the Office of Management and Budget under control number 1840–

0537) 

(Authority: 20 U.S.C. 1082, 1985, 1094, and 1099c)
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DRAFT for discussion at 3rd meeting

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[59 FR 22431, Apr. 29, 1994, as amended at 59 FR 34964, 

July 7, 1994; 59 FR 61180, Nov. 29, 1994; 60 FR 34431, June 

30, 1995; 60 FR 42408, Aug. 15, 1995; 61 FR 60603, Nov. 29, 

1996; 62 FR 27128, May 16, 1997; 63 FR 40624, July 29, 

1998; 64 FR 59038, Nov. 1, 1999; 65 FR 65637, Nov. 1, 2000]
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DRAFT for discussion at 3rd meeting

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Issue 3

Amendatory Language

Team II – School-based Loan Issues

x. Section 668.16 is amended by:

A. Revising paragraph (d).

B. Adding paragraph (d)(2).

C. Revising the authority citation that appears at 

the end of the section.

The revisions and additions read as follows:

§668.16 Standards of administrative capability.

* * * * *

(d)(1) Establishes and maintains records required 

under this part and the individual Title IV, HEA program 

regulations; and

(2)(i) Reports annually to the Secretary on any 

reasonable reimbursements paid or provided by a private 

education lender or group of lenders as described under 

section 140(d) of the Truth in Lending Act (15 U.S.C. 

1631(d)) to any employee who is employed in the financial 

aid office of the institution or who otherwise has 
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DRAFT for discussion at 3rd meeting

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responsibilities with respect to education loans or other 

financial aid of the institution, including--

(A) The amount for each specific instance of 

reasonable expenses paid or provided;

(B) The name of the financial aid official, other 

employee, or agent to whom the expenses were paid or 

provided;

(C) The dates of the activity for which the expenses 

were paid or provided; and

(D) A brief description of the activity for which the 

expenses were paid or provided.

(ii) Expenses are considered to be reasonable if the 

expenses—-

(A) Meet the standards of and are paid in accordance 

with a State government reimbursement policy applicable to 

the entity; or

(B) Meet the standards of and are paid in accordance 

with the applicable Federal cost principles for 

reimbursement, if no State policy that is applicable to the 

entity exists.

(iii) The policy must be consistently applied to an 

institution’s employees.
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DRAFT for discussion at 3rd meeting

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* * * * *

(Authority: 20 U.S.C. 1082, 1985, 1092, 1094, and 1099c)