Committee Meetings - 03/18/22 1 

DEPARTMENT OF EDUCATION

OFFICE OF POSTSECONDARY EDUCATION

INSTITUTIONAL AND PROGRAMMATIC

ELIGIBILITY COMMITTEE

SESSION 3, DAY 5, AFTERNOON

March 18, 2022 

On the 18th day of March, 2022, the following meeting

was held virtually, from 1:00 p.m. to 4:00 p.m., before Jamie

Young, Shorthand Reporter in the state of New Jersey.
Committee Meetings - 03/18/22 2 

PROCEEDINGS

MS. JEFFRIES: Well, good afternoon and welcome back,

everyone from lunch. I hope everyone had a chance to get up,

stretch, feed themselves. We're going to start this afternoon

session. And at this point, I'm going to turn it over to the

Department. So, Greg.

MR. MARTIN: Thank you, Cindy. At this point, the

Department would respectfully request a caucus with the state

attorneys general. So, I would like to request a 10-minute

caucus to include Mr. Finley, me, and the state attorneys

general.

MS. JEFFRIES: Okay. Alright. So, with that, Greg, do

you have an idea for just so people can gauge duration?

MR. MARTIN: It's 1:05, we'll call it. Yeah, I think

I think 1:15 should be adequate.

MS. JEFFRIES: Okay. If more time is needed, we can

always adjust to that. So, with that, we can go ahead and stop

the live stream. And Brady, if you would, if you're ready. We

are back in the main session and broadcasting live. I will

turn it back over to the Department with Mr. Greg Martin.

MR. MARTIN: Thanks a lot, Cindy, and as I indicated

earlier, we need to have an additional caucus that I'm to be

called with and so I get the names right, Cindy I'll let you

list the names for the caucus.

MS. JEFFRIES: Okay. My understanding is that this

caucus will take place with Greg from the Department, Steve
Committee Meetings - 03/18/22 3 

Finley from general counsel, Travis Horr, and Barmak Nazarian,

who are the representatives for service members and veterans,

as well as Brad Adams and Michael Lanouette, who are from

proprietary institutions, correct?

MR. MARTIN: That is correct.

MS. JEFFRIES: Okay. So, with that, we can go ahead

and stop broadcasting and- Okay, welcome back. Thank you,

everyone, for being patient during the caucuses that have

taken place. They are per protocol and necessary functions

from time to time. So, with that, I think I'll turn it over to

Greg and he can take us from there.

MR. MARTIN: Thank you, Cindy. Where we left off was

in A5, so I'll ask Vanessa. I think it's still Vanessa to

bring up the document. There we go. And then if we look at

under A4, let's get this correct here by romanette three. So,

we're going to go to romanette three where we left off. And

this discussion here that we're going to have is on income

share. Yeah, there we go. This is income share agreements. And

I want to point out that. Well, let me just go through this

text first. So, in A5 here, we've added romanette three and

romanette four to clarify how the Department treats income

share agreements in the context of 90/10. This is new

language. I do want to run through it. If the institution

wants to include an income share agreement or any other

alternative financing agreement as cash in its attestations in

which the agreement is with the institution only or with a 

related party to include any entity in the ownership tree, any

common ownership or any contractual agreement or continuous

financial relationship. For this section, then the following
Committee Meetings - 03/18/22 4 

must be included in the agreement. The institution must

clearly identify the institutional charges that are being

covered by the agreement. The charges must be the same or less

than the stated rate for institutional charges. The maximum

time and amount a student would be required to pay is clearly

identified, including the implied or imputed interest rate and

any fees. All payments must be applied in accordance with debt

repayment regulations. Interest and fees would not be included

in the attestation. The imputed or implied interest rate

cannot be more than the Federal Direct Unsubsidized Loan

interest rate for the same borrower type at the time the

agreement was signed. And in romanette four, only cash

payments representing principal payments on the income share

agreement or other financing agreement that were used to

satisfy tuition fees and other institutional charges may be

included in the attestation. No amounts from the sale of the

income share agreement to other financing or other financing

agreement may be included in the attestation. So, this is our

inclusion of income share agreements. There was some

discussion around the table. I know that. And about the extent

to which an income share agreement is a loan. And there was

some interest in the Department taking the language that you

see in three and placing it under romanette one, which clearly

identifies loans made to students or credited to the students

account at the institution. The Department is aware of CFPB

rulings and also our own recently issued guidance on ISAs.

However, at this time, we don't feel that we can legally move

that language up as under one identifying as a loan. However,

we do want to make certain that as it is a form of revenue

generated from institutional aid, we identify it as such and
Committee Meetings - 03/18/22 5 

regulate how these instruments can be, how the payments from

students who took advantage of one of these instruments

offered by the institution would be counted. And again, just

so we know where we stand. These would be ISAs offered by the

institution as this is under institutional aid. So, what we

can commit the Department to doing is in the in the preamble

section of the of the of the NPRM, we will make it clear what

the Department's position is on ISAs vis a vis there being

loans. What our position is at that point and that would be

consistent with what CFPB's guidance is at that time. So, we

will address that in the NPRM and the preamble portion. And I 

want to make clear, the Department takes ISAs very, very

seriously, and that we want to make certain that they are not

used as a means of obtaining revenue that does not have to be

counted as institutional aid. And in this respect, we're

treating it much the same since this is an ISA with

institution would give the student funding and then the

student essentially has to repay that through work that we are

still only allowing the amount that is repaid and then only

under the terms that we list here. So, it's very similar to

what we do with institutional loans. And with that, I'll open

it up for [audio]

MS. JEFFRIES: Okay. Thank you, Greg. Brad, you are

first.

MR. ADAMS: I'm curious. The decision in D romanette

3D on using the unsub loan interest rate as the rate. I think

it's about three and a quarter percent. And I'm just curious

on the thoughts there versus a Grad PLUS Loan versus one of

the other rates.
Committee Meetings - 03/18/22 6 

MR. MARTIN: Again, we're talking here about, and you

know, we're not saying. We want to make it clear. We're not

limiting, we don't have the authority to limit what types of

ISAs an institution can offer. What we're saying here is if

the institution wants to include an income share agreement as

cash in its attestation, that the imputed or implied interest

rate cannot be more than a Federal Direct and subsidized loan

interest rate for the same borrower type at the time the

statement was signed. This, we feel that using the unsub rate

is fair as that is the loan most students take advantage of

and well obviously some the subsidized rate but the

unsubsidized one is both fair to students at the institutions

and does cap it at a reasonable point. Whereas at least

Undergraduate PLUS Loans are not borrowed by students.

MS. JEFFRIES: Okay. Thank you, Greg. Jaylon.

MR. HERBIN: Yeah, I want to thank the Department for

making some of the changes. I want to just clarify one thing

here. You stated in your comment, you said that you cannot add

the term ISAs under the loan component because of the

authority, correct? But you are willing to add that in the

Revenue Department if I'm correct here. Correct? 

MR. MARTIN: So all of this under 5, if you go up to

5, which is revenue generated from institutional aids. So,

this deals with what revenue that results from institutional

aid can be counted as revenue. And, you know, for loans, what

we've said is with institutional loans, an institution doesn't

get to say here's a $5000-dollar institutional loan and then

say all of that counts as revenue since it comes from the

institution, and it has to be repaid. Because it has to be
Committee Meetings - 03/18/22 7 

repaid, we only allow the amount, the principal payments on

that loan to be counted on a cash basis as they are made. So,

we're doing the same thing with respect to ISAs. We're not

identifying them as institutional loans as such, but we're

treating since it is an instrument where it works very much

the same way and we are basically requiring that institutions

count the amount repaid only it's being repaid through this as

a percentage of the income the student earns as opposed to a 

traditional loan where you just simply make the payments that

we're still going to only count those amounts of those

amounts. So, it's kind of restricting not what institutions

can give students as far as institutional aid goes, but what

portion of that they can count as revenue if that makes sense.

MR. HERBIN: I mean, essentially, you're accounting

the principal and not the interest, I think. But my concern

would be that not want to foreshadow any future work or

anything but the ISAs if you look at previous administration

how they view the ISAs and we're trying to exempt them from

some of the lending laws, so to speak. I think that it should

be counted as a form of a loan, because that will open up

other predatory products, essentially, that will harm

borrowers and the students attending these universities and

looking at it. And also, I will bring up Marvin's request if

the Department could email us this proposed language so that

we can all at least look at it and have time to analyze it

real quick before we make a caucus decision.

MR. MARTIN: Well, I cannot issue preamble language

before the preamble is issued. All I can say, I can commit the

Department to a discussion of that in the preamble as, the
Committee Meetings - 03/18/22 8 

Department doesn't, the agency that would make determinations

about what is a loan and what isn't. That's more along the

lines of what's in reg Z, Treasury, and also CFPB. The

Department would yield on that on that determination. The CFPB

has made some determinations, but they're there within a 

strict, strict context. And I can have Steve elaborate on

that, but we just don't, our attorneys have determined that at

this time we cannot we can put this in here. And I think it

does protect students, because we're saying if we didn't

include this language at all, then it would allow an

institution, to execute an income share arrangementor

agreement with a student and essentially count all of it with

no, so I think if we didn't address it, it would be far more,

there would actually be incentive for institutions to steer

students into these arrangements if they offered them. Whereas

with this language it very much restricts what can be counted.

But as far as the legal aspects of it go, I'll let Steve

address that.

MR. FINLEY: Thanks, Greg. Thank you. I think the

Department generally views these ISAs as a form of

institutional loans. We’ve come out and agreed with the

position that the CFPB is taking on this, but at this point

the CFPB has only taken that position in a settlement

agreement with one entity. And our intention is to remain

aligned with how they've established it. But we understand

that in doing so it may change a little over time. So, we're

putting this in a separate section. I think we are willing to

restructure it and move it from romanette three up to

romanette two. So, it's closer to the provision where the

institutional loans are actually described. But we will
Committee Meetings - 03/18/22 9 

clarify in the NPRM that you know the intention here is to be

aligned and remain aligned with the CFPB position. But Greg's

right, those aren't written until they're written, and that's

not going to happen today.

MR. MARTIN: I've just been informed that we do give

negotiators an advance copy of the preamble before we make it

public. But I could not do that today. There's no way.

MR. FINLEY: Well, that's true, if it's an issue on

which consensus was reached.

MS. JEFFRIES: Let me just clarify.

MR. MARTIN: That's assuming if we were, that's

right, Steve, if we reach consensus today.

MS. JEFFRIES: Can I just clarify something here?

Marvin's request was not necessarily for the preamble

language. His request that he put in there was could they get

a copy of the amended text that you are sharing on screen?

MR. MARTIN: What I'm sharing currently is not

amended.

MS. JEFFRIES: Okay.

MR. MARTIN: What we are willing to say what we can

share what the Department also agreed to was take what was in

an almost neglect to do this is to take what is currently, I 

messed up here. Okay, take what's currently in romanette three

and move it, just move it up to romanette two. So, if you look

at romanette two, it's for scholarships. It discusses

scholarships provided by the institution. And we would just
Committee Meetings - 03/18/22 10

move romanette three up to the position of romanette two to be

closer to the, so it would immediately follow the discussion

on loans be closer to the loans discussion. So, we would

simply flip what is in three and what is in two. Those are the

only changes to the actual reg text you see here that would be

making. We can pull that up if we need to.

MS. JEFFRIES: Alright. Thank you, Greg. Adam.

MR. WELLE: Steve, did you? I think Steve was ahead

of me.

MS. JEFFRIES: I think his hand was still up or did

you have something more, Steve? Yeah.

MR. FINLEY: Thank you. My apologies.

MS. JEFFRIES: No worries. Go ahead, Adam.

MR. WELLE: Since I've been pushing this issue, and I 

can say that I think I'm comfortable moving on from here. You

know, my concern was the ambiguity within the proposal you

know around whether an institutional ISA would be covered by

both A5 romanette one and A5 romanette three. And then

secondarily, if they do fall under A5 romanette three whether

that would conflict with the position expressed by a few weeks

ago on ISAs. I'm comfortable, I think I'm you know, I'm

disappointed that this can't be clarified further. But I 

appreciate the Department's assurance that that this is

intended to be applied consistently with the CFPB's position

and that this will be clarified in the NPRM. So, I appreciate

that assurance and I think I'm able to move on from this.
Committee Meetings - 03/18/22 11

MS. JEFFRIES: Okay, great. Thank you, Adam. Jessica.

MS. RANUCCI: Just on the reg text. So, I think what

you're saying, Greg, if I understand you, is we did see a 

document that has blue highlighting that we have not had

access to. But the only blue highlighting there is to switch

the orders of two provisions and not change a single word of

text. So, you don't want to send it to us because there's

nothing substantive. Is that right?

MR. MARTIN: There's nothing. Yeah. Nothing would

change except for the flipping of two of romanette two and

romanette three. So, where you see two there, where it says

for scholarships provided that would now go down to three and

three. If an institution wants to include an income share

agreement which flip up to where two is directly below

romanette one, which is loans.

MS. RANUCCI: Yeah, I don't think anyone has a 

problem with that. It's the idea that you're working off a 

document with blue highlighting we've never seen. So, we'll

take your word- [interposing]

MR. MARTIN: No, the document I'm working off is the

exact one you have. I'm just telling you we agreed to switch

it toMS. JEFFRIES: Okay, I don't see anyMR. MARTIN: Vanessa can you pull the document back

up, Vanessa? So, if we go a little. Yeah, that's, go up a 

little higher. To the stem of three. Right. So, three, that's

three. And then above that is let's go up a little higher to
Committee Meetings - 03/18/22 12

two right there. No, Down, down a little further. I'm sorry,

Vanessa. So, just keep arrowing down. That's one for loans.

And then let's try to find romanette two, which is struck out

a little bit lower. Right there. If institution wants to, no,

where's loans? Oh, go down below that. Right here. It is

changed. I'm sorry we've [audio] here. This does reflect the

change. I'm very sorry about that. This is the change. I 

wasn't aware that we had that language up. So, this does

reflect the moving it up.

MS. JEFFRIES: Anything else on that, Greg? If not,

Jaylon's hand is up.

MR. MARTIN: No.

MS. JEFFRIES: Okay.

MR. HERBIN: I think Jamie's was before me.

MS. JEFFRIES: No, you were. I have it on order in my

screen, Jaylon, so unless Jamie had it up and then put it

down, that would be the only thing that changed it. So, if you

wouldn't mind, please go ahead and make your comment.

MR. HERBIN: Yeah, absolutely. I think I just have

one. What was, I guess, the logic behind adding the

scholarship component to the ISA language? That because that's

still a little unclear to me as far as when I look [audio]

MR. MARTIN: The scholarship, that's separate. The

scholarship is separate. That's a separate subparagraph. So,

all of this is under institutional aid. Scholarships have not
Committee Meetings - 03/18/22 13

changed. We've not changed any anything there. That's pretty

much our existing language.

MR. HERBIN: So, you just changedMR. MARTIN: That's not part of an ISA. It'sMR. HERBIN: Okay. That's what I wanted to make sure

that- [interposing] Okay, perfect.

MR. MARTIN: Flip [ph] into positions because it had

been asked that we move ISAs if we couldn't include them in

one, then we're moving them in romanette one, then moving them

closer to directly under the under the discussion of loans.

MR. HERBIN: That's [audio]. I just wanted to clarify

to make sure that we that we were not actually merging those

two together. Thank you.

MR. MARTIN: No, no, not at all. They're entirely,

entirely separate things.

MS. JEFFRIES: Okay. Thank you. Jamie.

MS. STUDLEY: I think [audio] hard at the paragraph

on scholarships. I think I may have found the answer, but I 

wanted to clarify that it's very hard where the established

restricted account is the institutions, how the funds from an

outside source that is unrelated to the institutions would be

read. I think your purpose is that the funds initially came

from, for example, a donor who genuinely was setting up a 

scholarship fund. But now the fund is the institutions because

it's an established restricted account that is provided for

scholarships by the institution. I don't know that you need to
Committee Meetings - 03/18/22 14

answer it now. You may just want to see if that reading could

be made a little easier because I found my head going back

[audio] [interposing] understanding the purpose.

MR. MARTIN: The purpose here is to not- 

[interposing]

MS. STUDLEY: Is the school [inaudible]?

MR. MARTIN: Yes. If the intent here is not to allow

what is essentially a tuition discount to become as an

institution of scholarship, that if it's going to be counted

as an institutional scholarship, it comes from a restricted

fund for that purpose, because otherwise I could just discount

the tuition and call that a scholarship. So, it needs to be

dispersed from an established restricted fund and may be

included as revenue only to the extent that that funds in that

account represent designated funds from an outside source

unrelated to the institution [audio]. So, the funds need to

come from an outside source to the restricted fund to be used

for making scholarships. So, you couldn't have, for instance,

a parent company contributing money to a fund from which

scholarships are made.

MS. STUDLEY: Right. Or an owner or [interposing]

MR. MARTIN: Correct. It's supposed to bring into

line more or less the way scholarship, the way that those

scholarships are done. And I guess it sort of mirrors a more

traditional model.

MS. STUDLEY: Community or nonprofit public

institutions [interposing]
Committee Meetings - 03/18/22 15

MR. MARTIN: But basically, yes. Yes, the basic thing

being to prohibit it being a tuition.

MS. JEFFRIES: Okay. Greg, I don't see any further

hands. Are you ready to move to the next section? Can you hear

me? 

MS. MILLER: Greg, I think you're on mute.

MS. JEFFRIES: I think you're on mute, I don't know

if you can hear me or?

MR. MARTIN: I'm sorry. No, I'm on mute. [Audio]

[interposing] tons of problems with it with the feed. No, noIn

this case, it was me. So, we have one more change. Let's move

on to six. So, moving past five. Moving to six. This is minor.

And this is in six romanette five. It's just that we've

corrected the order in this item, so it appears between the

last two items and that is it. So, it's a very minor change

there. And let me ask. That is, it for the paper. Steve, do we

have any more information on the other issue? [Inaudible] for

Steve to come back. Oh. Okay. I'll yield to Brad.

MS. JEFFRIES: Yeah, I think he's looking for

something. Okay, Brad.

MR. ADAMS: Yeah. I think it may be appropriate to

call another 5-to-10-minute caucus with maybe me and the

Department.

MS. JEFFRIES: The, when you say Department, can youMR. ADAMS: Yes. Steve Finley and Gregory Martin,

please.
Committee Meetings - 03/18/22 16

MS. JEFFRIES: Okay. And did you want Mike in there?

MR. ADAMS: Yes, please.

MS. JEFFRIES: Okay. Alright, Brady, can youMR. ADAMS: That's assuming we've gotten all the way

to the document and there were noMS. JEFFRIES: We have one hand up.

MR. MARTIN: We have, we would be ready for

consensus.

MS. JEFFRIES: Okay. Emmanual’s hand is up, so I 

think we need to take that question or comment before you do.

Okay. Emmanual.

MR. GUILLORY: Yeah, I have a comment. I've been

sitting here in silence trying to hold my tongue for as long

as I possibly could. But as a person who has observed this,

the previous neg reg session online for the public viewing,

they have no idea what's going on in these caucuses. When

you're caucusing for an hour and a half, which I think that

was the last, correct me if I'm wrong, when we got back from

break, the caucuses right until 2:30, either was an hour, an

hour and a half. We're going to another caucus. Caucuses, we

can do that by the rules and regulations. They're needed, I 

understand. So, we need to do them. But when this is happening

virtually and people are observing and trying to understand

what's going on, they have no idea what's going on. So, it

would be great that if you do go into caucuses for an extended

period of time, then when you come back, if you can share a 
Committee Meetings - 03/18/22 17

little bit about what those caucuses were about, I mean, I 

understand that there is some privacy in that. That's why you

want to go caucus. But if there's any way to just let the

public know, overall, we were trying to work through this

issue, but we weren't able to, blah, blah, blah, it would

probably be helpful for those who were just viewing this and

have no idea what's going on and they can't see the chat

either, so they have no idea what's going on in the chat. I 

just wanted to.

MS. JEFFRIES: Thank you for that concern, Emmanual.

Caucuses are confidential and private, and it is entirely up

to the parties that participate in that how they want to

handle them. So, and they are allowed per protocol. So, your

concern is noted. And with that, Brady, do you have the room

set up? [Interposing] Okay. If you could open it up. YouOkay. We are back live. And Greg, unless you have something

you want to say, I think the next step would be the consensus

check on the 90/10 issue paper.

MR. MARTIN: And before we do that, I'd like we have

and to address some of the caucus decisions here. We have had

some revised text proposed under in revenues generated from

program activities in three so and specifically in romanette

three. So, I'm going to ask for Vanessa to pull that back up

again and back up to the number three revenue generated from

programs and activities. We have some new language there. No,

go back up, Vanessa, to page two, revenue generated from.

There we go. So, so arrow down to romanette three there.

Right. Let's stop right there. Okay, so we do have some

proposed changes to the text that I want to bring up before we
Committee Meetings - 03/18/22 18

take a vote on consensus. And I want to say that this language

represents discussions between the proprietary representative

and the representatives of the veterans. And what we're hoping

to do here is to get to mutually agreeable language so that we

can get to consensus. And so, what I'll do is I'll read this

language out to you. So, in three, this is we're talking here

again about revenues generated from program activities. And

this is the institution must consider as revenue only those

funds it generates from and under romanette three funds paid

by a student or on behalf of a student by a party unrelated to

the institution, its owners or affiliates for an education

program or training program that is not eligible under 668.8

and does not include any courses offered by an eligible

program. The non-eligible education or training program must

be provided by the institution and taught by one of its

instructors at its main campus, or one of its approved

additional locations, or at a school facility approved by the

appropriate state agency or accrediting agency, or at an

employer facility. The institution may not count revenue from

a non-eligible education or training program where it merely

provides facilities for test preparation acts as a proctor or

oversees a course of study. The program must, and you can

arrow down there, be approved or licensed by the appropriate

state agency, accredited by an accrediting agency, recognized

by the Secretary, and then provides an industry recognized

credential or certification. And we have added back in below

here you'll see D and E. This is a change over what the paper

initially said provides training needed for students to

maintain state licensing requirements or provides training

needed for students to meet additional licensing requirements
Committee Meetings - 03/18/22 19

for specialized training for practitioners that already meet

the general licensing requirements. So, I know this is new.

Give you a second to digest that. I do want to open the floor

for any comments on limited to this particular to this

particular text before we go on. I do want to say that we have

worked hard to find some common ground here where the

Department and the veterans advocates, and the proprietary

sector can agree so that we can hopefully reach consensus on

something which is fair to all parties and protect students.

Thank you. I'll open the floor forMS. JEFFRIES: Okay, the floor is open for comments

on this this section only that Greg just presented. Jessica.

MS. RANUCCI: I don't want to delay things. I 

appreciate the time. I appreciate your effort. Can you email

it? I just it's just if we're going to vote in, like, very

soon, it would be very nice to have [inaudible]. Thank you.

MS. JEFFRIES: Any comments or questions on what you

just saw before you? Travis.

MR. HORR: Yeah, I'll just comment on this, that this

is you know a compromise language that that we support, and we

worked hard for it. And we appreciate the Department of

Education going back and forth with all of us on this. And we

appreciate that the faculty members that are teaching these

courses, they have to be real you know educators at these

accredited at the approved programs in order to cover concerns

that we had there. And. Sorry, [inaudible] a couple different

things, but yeah, we really appreciate the Department's work

on this and we're supportive of this.
Committee Meetings - 03/18/22 20

MS. JEFFRIES: Thank you, Travis. Brad.

MR. ADAMS: And I also just want to second that you

know we moved away from a lot of our talking points throughout

the past three weeks in order to get to a resolution that I 

think we can live with. I want to thank all the all the folks

that have worked on this. But I do want you to know, the

industry that I'm representing this was very important to and

there were a lot of other things that we moved away from in

order to get to this point. But thank you to the Department.

MS. JEFFRIES: Additional comments, questions?

[Audio] 

MR. MARTIN: Yeah. I do want to point out, before we

close that out, as I said before this, this does represent you

know a compromise position on the part of the Department. And

I think on all parties, we do have concerns about the types of

revenue that we're talking about here. We want to just make it

clear that you know although we think consensus is certainly

important and everybody worked hard to get to this point, I do

want to point out that, you know, we do remain concerned about

this issue. And we think this language that we have proposed

puts some reasonable constraints around it, that as much as

we're requiring that that the revenue if it's going to be at a 

employer facility, that it be a true facility. And that would

be an actual agreement whereby there is construction going on.

So, I do want to point that out before we before we move to a 

consensus vote, but I also want to point out how happy I am

that we were able to. It took a lot, but to be able to get to

this, we were able to get to this point. And I think if we, I 

want to make a pitch for consensus here that if we are able
Committee Meetings - 03/18/22 21

to, I know that perhaps everybody doesn't find the language

perfect. But I think if we can get to consensus here,

especially on this particular topic, we are doing a lot to

protect students. As I said before, we do have we do have some

concerns about with 90/10. There's always you know, especially

here with schools, we don't want to open up an avenue for

schools to avoid the consequences of 90/10. And so, we are

concerned that the programs being offered by, or the training

being offered by institutions offsite is of adequate quality.

And we have seen evidence of things that we didn't feel met

that standard, which is why we originally proposed the

language. And you know we go back to the original intent of

90/10, which is to ensure institutions have educational

programs of sufficient quality that can generate the 10

percent. And we still believe that is the spirit of 90/10.

However, as I said before, in the interest of reaching

consensus today, we have put forward some additional

compromise language and we do feel this strikes the

appropriate balance. I really want to encourage all of you

today to look at this and consider that we are, I think, doing

a great service to students here. If all of us can reach

consensus on this, it sends a powerful message that the

community as a whole is in agreement on this. And I mean,

while it's true that if there is no consensus, the Department

you know can write regulations and will write regulations, I 

think it certainly adds another level if we can reach

consensus and maybe put aside some of the areas we might not

be 100 percent you know thrilled with in order to come to some

agreement that is mutually beneficial to everybody. So, with

that and an encouragement here to have everybody to make, to
Committee Meetings - 03/18/22 22

ask everybody, rather to think about this before they vote.

I'll go on to ask Cindy to call the consensus vote at this

time. And I thank you all for your consideration and your

patience and bearing with us on this issue.

MS. JEFFRIES: Thank you, Greg. I appreciate that.

So, with that, we will take the consensus vote. Remember a 

thumbs up, you're 100 percent on board with it, sideways thumb

means you can live with it, and a downward thumb means you

have serious reservations that would cause you to dissent. So,

with that, if I could please see your thumbs, we will do a 

verbal rollcall of the vote. Okay. Anne Kress, thumbs up. Brad

Adams, sideways thumb. Jamie Studley, thumbs up. Debbie

Cochrane, thumbs up. Travis Horr, thumbs up. Adam Welle,

sideways thumb. Marvin Smith, thumbs up. Jaylon Herbin,

sideways thumb. Amanda Martinez, thumbs up. Carney King,

sideways thumb. Emmanual Guillory, thumbs up. Sam Veeder,

thumbs up. Jessica Ranucci, sideways thumb. Beverly Hogan,

thumbs up. And Gregory Martin, sideways thumb. So, I want to

say to the committee and all the hard work that you put into

this, congratulations, you have reached your first consensus

of this negotiated rulemaking, and it was on a very, very

difficult topic. So, congratulations. Adam, you have a 

comment?

MR. WELLE: I just wanted to say that you know I,

just about previous discussion around income share agreements.

We had strong concerns about that. And my side vote was, it

was based on and conditioned on the assurance we got from the

Department that there would be a statement in the NPRM that
Committee Meetings - 03/18/22 23

was discussed previously around income share agreements. So, I 

just wanted to make that clear. Thanks.

MR. MARTIN: Yeah, also we did agree to that and

since I'm sure I will be one of the people writing the NPRM, I 

don't see how I'm going to get out of it. Yeah, we'll make

certain that unless they physically restrain me from doing it,

I will make certain that way that I hold to our end of the

bargain there. Thank you. And I want to thank everybody again

for you know the consensus vote here, because I think it's

very important. With that, Cindy, what I'd like to do is if we

could if we could try to build on our success here for a 

moment, since we're at 3:35, I'd like to go back and ask

Vanessa, you know what they say, everything old is new again,

or is that the way it goes? I think I misquoted that oranyway, that's the way I'm going to quote it. But if we could

go back to issue paper one, and I want to remind everybody

that you know with issue paper one, we came pretty close and

we hold on one second here. I hope I'm not jumping the gun.

Just a second here. Sometimes the virtual world can be very

difficult. Let me just say that. So, Vanessa's pulling that

up. Let's get to the proper section. Let's go down to let's go

to E. Vanessa, if you can pull that up and issue paper one and

I apologize for making you go all the way back to the first

day? I know everybody doesn't want to probably go back to the

first date again. You're thinking, wow, half an hour before it

ends, you're really going to make us do this. And the answer

to that question is, yes, I am. So, we're looking at and this

is on page six, Vanessa. And we're looking at yeah 56E. I'm

sorry. Did we lose you, Vanessa? Okay. I'm being told, I'm
Committee Meetings - 03/18/22 24

being told we need a caucus. Hold on a moment, please. I have

to request 10 minutes, Cindy.

MS. JEFFRIES: Okay. Not a problem, Greg. Who would

you like in the caucus?

MR. MARTIN: The Department. 

MS. JEFFRIES: I'm sorry, who?

MR. MARTIN: I think just, I think just the

Department. The Department staff.

MS. JEFFRIES: Okay.

MR. MARTIN: I mean a break. I should call it a 

break.

MS. JEFFRIES: Okay. Alright. So, we'll take a 10-

minute break.

MR. MARTIN: Anne Kress, Will Durden, I guess Mr.

Finley and myself.

MS. JEFFRIES: Okay. You got that, Brady?

MR. ROBERTS: Yep, they're ready to go.

MS. JEFFRIES: Okay, so you think, what, about 10

minutes? Yeah. Okay. Go ahead and open up those breakout rooms

and we can stop the- Okay. We are back on livestream. With

that, I'm going to turn it over to Greg from the Department.

MR. MARTIN: Thanks, Cindy. So again, I wanted to go

back, you'll recall the issue paper issue paper one, which was

Ability to Benefit that we had, we were very close to
Committee Meetings - 03/18/22 25

consensus on issue paper one. The only sticking point was

under the state process, and I want to remind everybody that

this is only applicable to the state process. We do, just to

reiterate, all know that for a student to participate in ATB,

it has to be through an eligible career pathways program, but

that the state process is a small subset of that. So, this is

only applicable to where the state process where we currently

say in E, and I'll ask Vanessa to pull up the screen for us.

So, I want to go to page six in the document, Vanessa. Oh,

there we are. That's it. We're right there. Fantastic. So,

you'll see there [audio] year period we discussed this on day

one, in paragraph B of this section, the state must reapply

for continued participation and in its application demonstrate

that the students it admits under that process, at each

participating institution, have a success rate as determined

under paragraph F of this section that is within 95 percent of

the success rate of students with high school diplomas. That

is an extremely high rate. We were asked if we think that,

Will had some concerns about that and asked if we could you

know consider moving a little bit in that direction.

Specifically, he said he would be willing to accept an 85

percent success rate, which I still want to add is very

robust. If you think about average success rates at schools

and what, you know, what completion rates are, I think we

would all agree that 85 percent is not a low hurdle to clear.

I still think it puts a great deal of protection on, it is

perhaps a little more of a reasonably attainable goal than 95

percent. And as much as what we want to do here is to in

addition to the protections that that this, that these

regulations offer, and there are a lot of them we are adamant
Committee Meetings - 03/18/22 26

about not just, you know, opening floodgates to ATB that these

be these be programs that really move students in a positive

direction. And a lot of students who are participating in ATB

come from stressed backgrounds. We know that. We did not want

to open the door to abuse here, and this does not do that.

Remember, these are state processes. These are being put

forward by states approved by the Department. So, with 85

percent in mind, we don't have time now to produce changed

text. But I can go on record officially as saying the

Department would change in E1, we would now say demonstrate

that the student it admits under that process at each

participating institution have a success rate as determined

under paragraph F of the section that is within 85 percent of

the success rate of students with high school diplomas, making

no other changes to the document, and reminding the

negotiators that we did reach consensus on that with the

exception of that element. And I think it would be great if we

can reach consensus on this as well, because again, something

that really benefits students and sends a signal to the to the

community, I think the legislators, that we are in agreement

of where we should be going with ATB. So, and again, I 

apologize for not being able to offer the language there for

you to look at. But all we are doing is changing the nine to

an eight. And I can assure you that we will make that change.

SoMS. JEFFRIES: Okay, thank you, Greg.

MR. MARTIN: [Inaudible] document, Vanessa, thank

you.
Committee Meetings - 03/18/22 27

MS. JEFFRIES: With that, I'm not seeing any hands.

What I'd like to do is call for consensus on the overall

document, recognizing that that will be the only change in

the, as committed on the record that they will go to 85

percent for state processes. Correct?

MR. MARTIN: That is correct.

MS. JEFFRIES: Okay. So, with that, could I please

see your show, a show of thumbs? Alright. Sam Veeder is a 

thumbs up. Jessica Ranucci, thumbs up. Carolyn Fast, thumbs

up. Travis Horr, thumbs up. Will Durden, thumbs up. Mike

Lanouette, thumbs up. Emmanual Guillory, thumbs up. Marvin

Smith, thumbs up. Adam Welle, sideways thumb. David Socolow,

thumbs up. Ernest Ezeugo, thumbs up. Amanda Martinez, thumbs

up. Jamie Studley, thumbs up. And Greg Martin from the

Department is thumbs up. Alright, congratulations. You now

have two consen- papers that you have reached consensus on.

Congratulations. What a great job and what a way to end this

session. So, with that, we can go ahead with the closing of

this negotiated rulemaking. On behalf of FMCS, we'd like to

thank everyone for their hard and dedicated work on this very

important project and commend you on how well you handled this

and your professionalism. And it was our distinct pleasure to

work with every single one of you esteemed negotiators, the

Department, the advisors, the whole thing. I'd like to have

Greg do some closing comments if he wants, and then there's

been a request that the negotiators have a few minutes to say

their goodbyes.

MR. MARTIN: Thank you very- 
Committee Meetings - 03/18/22 28

MS. JEFFRIES: Emmanual. Emmanual, you have a hand

up. Emmanual, did you need something?

MR. GUILLORY: No, I just wanted to say my goodbyes

just whenever.

MS. JEFFRIES: Okay. Alright. Thanks. We'll let Greg

speak and thenMR. MARTIN: Oh, thank you very much. I have about an

hour of prepared remarks. No, not at all. I just I want to

thank everybody for their participation this week and not just

this week, but in the previous months as well. I know it's

been a long couple of months. It's been my privilege to have

served in this capacity with all of you. And every time I do

this, I learn something else. It certainly keeps me on my

toes. I want to thank all of the negotiators, thank our

advisors, and I especially want to thank all the Department

staff behind me who make this possible, especially our, the

support we get from OGC, our general counsel's office, who are

always on and always have to be ready for me to say I would

like this person to comment on that and have to do it at the

last minute. So, although we didn't reach consensus on five

items, we did on two, one of which was very difficult, I 

think, to get to, but we did. And the other one, a very

important thing, safeguard for students as well. So, I think

we did do some good work. We've, you've given the Department a 

lot to think about and constructing the NPRMs as we go

forward. And I just want to wish all of you a great spring and

I hope that as we emerge from the virtual world and maybe go

back to actual conferences again, I see some of you around and
Committee Meetings - 03/18/22 29

in some of those settings. So, with that, again, it's been a 

pleasure and goodbye. I think you might be on mute, Cindy. 

MS. JEFFRIES: Am I?

MR. MARTIN: You're good now. Now you're on mute.

MS. JEFFRIES: Can you hear me now? Alright.

Emmanual.

MR. GUILLORY: I just wanted to add, I see my other

fellow negotiators saying their goodbyes in the chat, but I 

want to verbally thank the Department for all the hard work

and effort you put into this. It is not easy to do this, and I 

know that. And Greg, I know it's definitely not easy to be in

your shoes with hearing what we're saying and trying to take

it back to folks and trying to work things out. So, I really,

really do appreciate it. It does not go unnoticed by any

means. And also, I just want to say to my fellow negotiators,

I really enjoy getting a chance to virtually know you a little

bit better. I have tremendous respect for you, your passion,

your perspective. So, by all means, these conversations that

we had doesn't have to end here. We would love to continue to

have conversations with you if you want to continue to have

them with us. And I wish everyone a very, very happy and

wonderful weekend. Nice working with you all

MS. JEFFRIES: Thank you, Emmanual. Jamie.

MS. STUDLEY: Without presuming that I am the senior

person on the group, I would like to take just a brief moment

for history. Let me start along with the rest of you for

applauding the spirit, the preparation, the respect that
Committee Meetings - 03/18/22 30

everyone has shown to each other in this process. And I join

with the appreciation for the Department negotiators who have

an incredibly difficult job to do all of this. And we know

that many different functions come together. Also, for the

facilitators. I've seen great facilitators in neg reg and I 

have seen weak facilitators. And your team, Cindy and all the

rest of you have done a really strong job and it makes a very

big difference to the tone and value of these conversations. I 

also want to thank everybody for the unfamiliar opportunity to

watch the sunrise. I don't plan to make it a habit, but Debbie

and I have tried to remain alert, even in our time zone. In

1993, as a brand-new deputy general counsel at the Department

of Education for regulations and legislation called Regs and

Legs, I was assigned to figure out how to implement a 

provision of the new statute called negotiated rulemaking or

regulatory negotiation. It's gone by both names. And it has

been a privilege to be involved over so many years in trying

to reap the benefits of hearing all perspectives in a process

like this. I've been in the General Counsel's Office, the

policy office, and now for the first time, an official

negotiator in a negotiated rulemaking. Steve Finley and I had

the privilege of handling a semi negotiated rulemaking on

financial responsibility, but we're not sure this is the time

to remind you of our role in that venerable, there are other

adjectives, process. But each time the value of bringing

together different groups to try and see each other's

perspectives has actually made a difference. In those, just a 

minute more, in those early days, we had to not only find

student groups who had a policy interest, but we have to train

them to understand enough about Federal regulations to
Committee Meetings - 03/18/22 31

participate and make sure that they didn't just get their

training from our perspectives so that they can function

effectively. And it is really incredible to see the

sophistication of so many groups from across the spectrum of

consumer and student groups and institutions and state

agencies and attorneys general and so forth, who can now make

this a much, much deeper and more thoughtful process. It's

come a long way. Sometimes we achieve consensus, sometimes we

achieve understanding. But for all the challenges, it's just

wonderful to see the interchange and respect within this

discussion. So, thank you. And to your next neg regs, may they

be as thoughtful and engaged as this one. So, thanks again to

the Department andMS. JEFFRIES: Thank you, Jamie. Brad.

MR. ADAMS: Thanks. I'll be quick. As the newbie to

the committee, I'll just say it's been quite an experience

that I will always cherish. I learned a ton and I think

everyone in this committee brings a very unique perspective.

And I learned from every one of one of you during this

process. And sitting in this chair is very difficult, but I 

cannot imagine sitting in Greg's chair. So, you did as well as

could've been asked in the circumstance of us trying to get

together. And I think the facilitators did an excellent job as

well. So, the Department, congratulations for all your hard

work. I know we've still got some work to go to get through

the rest of these issue papers, but I really appreciate

everything you all did. And thank you for listening to me for

the past three months. And good to meet everybody.
Committee Meetings - 03/18/22 32

MS. JEFFRIES: Thank you, Brad. We appreciate it. We

appreciate all these wonderful comments and the success that

you've had and the wonderful, robust dialog. With that,

there's only one last thing I want to say as a reminder that

during this period, the Department cannot do anything with

written comments that are sent to them. So, the appropriate

time to send those in would be during the NPRM period where

you will have at least 30 days to submit written comments. So,

please try to refrain from sending them in prior to that point

in time, as the Department cannot do anything with them,

including posting them on the website. So, please keep that in

mind. And with that, we wish you all the best, and thank you

for letting us be a part of this.

MR. FINLEY: Thanks, everyone.
Committee Meetings - 03/18/22 33

Department of Education, Office of Postsecondary Education

Zoom Chat Transcript

Institutional and Programmatic Eligibility Committee 

Session 3, Day 5, Afternoon, March 18, 2022

From Beverly Hogan Primary/MSI to Everyone:

I am still on.

From Marvin Smith (P) 4 Year Publics to Everyone:

Is there a chance that new ED language could be sent to

negotiators via email?

From Marvin Smith (P) 4 Year Publics to Everyone:

I was not asking for preamble language. Just what was

shown on screen

From Jamienne Studley-Accrediting Agencies (P) She/her to

Everyone:

+ Marvin -- just sending out or putting the text back you

showed us on screen would help

From Jamienne Studley-Accrediting Agencies (P) She/her to

Everyone:

was the highlighted section new ? 

From Marvin Smith (P) 4 Year Publics to Everyone:

thank you for clarifying jessica

From Laura Rasar King (A) Accrediting Agencies to Everyone:
Committee Meetings - 03/18/22 34

I have to leave the meeting at 3:45 today (my son is

having an Eagle Scout recognition ceremony!), but I wanted to

say that I enjoyed working with all of you and wish we could

have done it in person. Until next time!

From Anne Kress (P) Comm College to Everyone:

Congratulations to your son, Laura!

From Cindy-FMCS Facilitator to Everyone:

What an wonderful and commendable accomplishment.

Congratulations to your son.

From Emmanual Guillory (A) PNPs to Everyone:

Great working with you Laura!

From Jamienne Studley-Accrediting Agencies (P) She/her to

Everyone:

+ if ED is satisfied by the guard rails, this seems like

a reasonable way to recognize bona fide revenue generating

educational activities by institutions

From Anne Kress (P) Comm College to Everyone:

+1 Jamie

From Anne Kress (P) Comm College to Everyone:

Will is coming to the table for CCs.

From Debbie Cochrane (P), State Agencies to Everyone:
Committee Meetings - 03/18/22 35

David Socolow will be returning to the table for state

agencies for ATB.

From Jaylon Herbin- (A) Consumer Advocate & Civil Rights to

Everyone:

Carolyn will be retuning back to the table for Consumer

advocates and civil rights for ATB

From Ernest Ezeugo (P) Students and Student Loan Borrowers to

Everyone:

I'll be returning to the table for Students and Student

Loan Borrowers.

From Jamienne Studley-Accrediting Agencies (P) She/her to

Everyone:

Nice hail mary pass!

From Kelli Perry - (P) Private Non-Profits to Everyone:

It was nice working with all of you over the last couple

of months. Have a nice weekend.

From David Socolow (A) State Agencies to Everyone:

Thanks to you all; it was a pleasure working with each of

you.

From Sam Veeder (P) FA Administrators to Everyone:

It was nice working with all of you! Have a wonderful

weekend.

From Travis Horr (P) Servicemembers & vets to Everyone:
Committee Meetings - 03/18/22 36

Thanks to everyone, it's been great working and learning

from all of you!

From Marvin Smith (P) 4 Year Publics to Everyone:

Appreciate working with everyone and all of your

commitment to students!

From Anne Kress (P) Comm College to Everyone:

Thank you for bringing your voices and perspectives to

this important work! It was an honor to work with you.

From Bradley Adams (P - Proprietary Institutions) to Everyone:

It was amazing to meet you all and truly appreciated

everyone's remarks and inputs. I have also learned so much

over the past three months and enjoyed this process.

From Ernest Ezeugo (P) Students and Student Loan Borrowers to

Everyone:

Thank you, everyone. It's been an honor to negotiate

these rules with you all.

From Yael Shavit to Everyone:

Thank you to everyone for a productive couple of months.

It was wonderful to work with you all.

From Dave McClintock (Advisor) Auditor to Everyone:

glad to be witness to a group who worked together to help

students. I learned a lot and many new perspectives.

From Anne Kress (P) Comm College to Everyone:
Committee Meetings - 03/18/22 37

Special thanks to the FCMS team, too!

From Jaylon Herbin- (A) Consumer Advocate & Civil Rights to

Everyone:

It was great working with everyone! It has been a true

honor to represent student borrowers with you all.

From David (A) FA Administrators to Everyone:

Thank you everyone!

From Dave McClintock (Advisor) Auditor to Everyone:

+1 thanks to FMCS

From Carolyn Fast (P) Consumer Advocates/Civil Rights to

Everyone:

Thank you to the negotiators, facilitators, and

Department for all your hard work. So honored to work with you

all!

From Anne Kress (P) Comm College to Everyone:

Thank you to the Department! Enjoy a non-NegReg weekend!

From Amanda Martinez (P) Civil Rights to Everyone:

I learned from every one of you and thankful to have had

this experience with you all!

From Jessica Ranucci (A)- Legal Aid to Everyone:

I echo these sentiments. It was wonderful to work with

you all. I appreciate all of the serious consideration and
Committee Meetings - 03/18/22 38

input from all points of view, and I hope that we can work

together in the future.

From Deborah Stanley (A) 4 year public to Everyone:

Thank You all for this wonderful experience

From Debbie Cochrane (P), State Agencies to Everyone:

Lovely to have worked with you all these last few months.

This group reflects a huge array of experience and

perspectives and I've learned from each of you.

From Carolyn Fast (P) Consumer Advocates/Civil Rights to

Everyone:

Thanks so much Jamie!

From Ernest Ezeugo (P) Students and Student Loan Borrowers to

Everyone:

Thank you, Jamie!

From David Socolow (A) State Agencies to Everyone:

Thanks, Jamie!