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ICRA S Tracking and OMB Number: ( 1388 ) 1845 - 0007 Revised: 08 / 15 /2013 RIN Number: XXXX - XXXX (if applicable) **SUPPORTING STATEMENT FOR PAPERWORK REDUCTION ACT SUBMISSION**  **A. Justification** 1. Explain the circumstances that make the collection of information necessary . Identify any legal or administrative requirements that necessitate the collection. Attach a hard cop y of the appropriate section of each statute and regulation mandating or authorizing the collection of information , or you may provide a valid URL link or paste the applicable section 1
. Specify the review type of the collection (new, revision, extension, reinstatement with change, reinstatement without change) . If revised, brie fl y specify the changes. If a rulemaking is involved, make note of the sections or changed sections, if applicable. Section 455(i) of the Higher Education Act of 1965, as amended (the HEA) requires the U.S. Department of Education (the Department) to dev elop, print, and distribute a standard promissory note to schools that participate in the William D. Ford Federal Direct Loan (Direct Loan) Program. Since the 1999 - 2000 program year, the standard promissory note for Federal Direct Stafford/Ford (Direct Sub sidized) Loans and Federal Direct Unsubsidized Stafford/Ford (Direct Unsubsidized) Loans has been the Master Promissory Note (MPN) that was developed by the Department in accordance with §432(m)(1)(D) of the HEA. The Direct Loan Program regulations require a borrower to complete an MPN before receiving a Direct Subsidized or Direct Unsubsidized loan (see 34 CFR 685.201(a)(2)). The Department is requesting a revision of the currently approved collection. The proposed changes include the following:
 Updating i nformation about the interest rate for Direct PLUS Loans to reflect recent changes made by the Bipartisan Student Loan Certainty Act of 2013 (Public Law 113 - 28) .  Adding information about the time limit on eligibility for Direct Subsidized Loans that was in cluded as part of the Moving Ahead for Progress in the 21 st Century Act (Public Law 112 - 141).
 Adding information about the new Pay As You Earn repayment plan that was established by final regulations published on November 1, 2012 (77 FR 66088).
 Expanding the descriptions of the Income - Based and Income - Contingent repayment plans to provide more detailed information about these plans.
 Removing information about the no - longer - available up - front interest rebate repayment incentive.
 Replacing the single “Repayi ng Your Loans Chart” at the end of the Borrower’s Rights and Responsibilities Statement that accompanies the MPN with four separate charts. The single chart in the currently approved forms covers only the Standard, Graduated, Extended, and 1 Please limit pasted text to no longer than 3 paragraphs.2

ICRA S Tracking and OMB Number: ( 1388 ) 1845 - 0007 Revised: 08 / 15 /2013 RIN Number: XXXX - XXXX (if applicable)

Income - Contingen t repayment plans, and for the Extended plan it provides sample payment amounts only for the Extended - Fixed payment option. The proposed revised MPN will include a single chart covering the Standard, Graduated, and Extended plans, with sample payment amoun ts for both the Extended - Fixed and Extended - Graduated payment options, plus three new charts that provide sample payment amounts for the Income - Based, Pay As You Earn, and Income - Contingent repayment plans.
 In various places, revising language to present i nformation more clearly and concisely. 2. Indicate how, by

whom, and for what purpose the information is to be used. Except for a new collection, indicate the actual use the agency has made of the information received from the current collection. The Department will continue to use the information collected on the MPN to process and service Direct Subsidized and Direct Unsubsidized loans made to student borrowers. The MPN serves as the borrower’s legally binding promise to repay all loan amounts disbur sed under the MPN. 3. Describe whether, and to what extent, the collection of information involves the use of automated, electronic, mechanical, or other technological collection techniques or forms of information technology , e.g. permitting electronic s ubmission of responses, and the basis for the decision of adopting this means of collection. Also describe an y consideration given to using technology

to reduce burden. The Department makes maximum use of available information technology to process MPNs . Schools electronically receive data provided by the student on the Free Application for Federal Student Aid (FAFSA) and create loan records based on the FAFSA data and additional data provided by the school. This process allows most of the information re quested in Section A of the MPN (Borrower Information) to be preprinted, thus reducing burden on borrowers. Beginning with loans made during the 2001 - 2002 program year, the Department has offered borrowers the option of completing the MPN through an entire ly electronic process, using a personal identification number (PIN) provided by the Department. The Department will continue to offer this option with the revised MPN. The electronic process uses an HTML (hypertext markup language) version of the paper MPN and stores the HTML version as the authoritative copy of the MPN. The text and data elements on the HTML version are identical to the text and data elements on the paper MPN. Since the introduction of the electronic MPN option, the percentage of MPNs that are completed electronically has steadily increased. Currently, approximately 98% of Direct Loan MPNs are completed electronically. 4. Describe efforts to identify duplication. Show specificall y wh y an y similar information already available cannot be u sed or modified for use for the purposes described in Item 2 above. Except as explained in Item 3, above, there is no information available from other sources that can be used for the purposes described in Item 2.3

ICRA S Tracking and OMB Number: ( 1388 ) 1845 - 0007 Revised: 08 / 15 /2013 RIN Number: XXXX - XXXX (if applicable) 5. If the collection of information imp acts small businesses or other small entities, describe any methods used to minimize burden. A small entity may be (1) a small business which is deemed to be one that is independently owned and operated and that is not dominant in its field of operation; ( 2) a small organization that is any not - for - profit enterprise that is independently owned and operated and is not dominant in its field; or (3) a small government jurisdiction, which is a government of a city , county, town, township, school district, or sp ecial district with a population of less than 50,000. No small businesses are affected by this information collection. 6. Describe the consequences to Federal program or policy activities if the collection is not conducted or is conducted less frequentl y, as well as an y technical or legal obstacles to reducing burden. Without this collection of information, borrowers would not be able to receive Direct Subsidized or Direct Unsubsidized loans. The MPN minimizes the frequency of data collection by allowin g a borrower who has completed an initial MPN to receive subsequent loans for up to 10 years without signing another MPN, if the borrower is attending a school that is authorized to make multiple loans under the MPN and chooses to do so. The MPN also reduc es burden for borrowers attending schools that are not authorized to use the multi - year feature of the MPN (or that choose not to do so), since they may receive subsequent loans during the same academic year without having to sign a new MPN. 7. Explain any special circumstances that would cause an information collection to be conducted in a manner:

 requiring respondents to report information to the agency more often than quarterl y;  requiring respondents to prepare a written response to a collection of information in fewer than 30 day s after receipt of it;  requiring respondents to submit more than an original and two copies of any document;  requiring respondents to retain records, other than health, medical, government contract, grant - in - aid, or tax reco rds for more than three ye ars;  in connection with a statistical survey , that is not designed to produce valid and reliable results than can be generalized to the universe of study ;  requiring the use of a statistical data classification that has not been re viewed and approved b y OMB;  that includes a pledge of confidentiality that is not supported by

authority established in statute or regulation, that is not supported by disclosure and data security policies that are consistent with the pledge, or that unnec essaril y i mpedes sharing of data with other agencies for compatible confidential use; or  requiring respondents to submit proprietary trade secrets, or other confidential information unless the agency can demonstrate that it has instituted procedures to pro tect the information ’ s confidentiality to the extent permitted by law. This information collection does not involve any of the conditions listed in 5 CFR 1320.5(d)(2).4

ICRA S Tracking and OMB Number: ( 1388 ) 1845 - 0007 Revised: 08 / 15 /2013 RIN Number: XXXX - XXXX (if applicable) 8. As applicable, state that the Department has published the 60 and 30 Federal Register notices as required b y 5 CFR 1320.8(d), soliciting comments on the information collection prior to submission to OMB. Summarize public comments received in response to that notice and describe actions taken b y the agency in response to these comments. Specifically address comments received on cost and hour burden. Describe efforts to consult with persons outside the agency to obtain their views on the availability

of data, frequency

o f collection, the clarity

of instruction and record keeping, disclosure, or reporting format (if an y), and on the data elements to be recorded, disclosed, or reported. Consultation with representatives of those from whom information is to be obtained or those who must compile records should occur at least once every 3 years – even if the collection of information activity

is the same as in prior periods. There may be circumstances that may preclude consultation in a specific situation. These circumstance s should be explained. The Department consulted with schools and other members of the financial aid community in developing the original MPN and improving the MPN. The paperwork clearance process will provide the public with two opportunities to submit c omments on the revised MPN. 9. Explain any

decision to provide any

pay ment or gift to respondents, other than remuneration of contractors or grantees with meaningful justification . No payments or gifts will be provided to respondents. 10. Describe an y assurance of confidentiality provided to respondents and the basis for the assurance in statute, regulation, or agency policy . If personally

identifiable information (PII) is being collected, a Privacy Act statement should be included on the instrument. Pl ease provide a citation for the Sy stems of Record Notice and the date a Privacy Impact Assessment was completed as indicated on the I C Data Form . A confidentiality statement with a legal citation that authorizes the pledge of confidentiality should be prov ided. 2 If the collection is subject to the Privacy Act, the Privacy

Act statement is deemed sufficient with respect to confidentiality . I f there is no expectation of confidentiality , simply state that the Department make s no pledge about the confidentiall y of the data. The MPN includes a Privacy Act Notice that (1) informs the borrower of the statutory authority for the information collection, (2) explains that disclosure of the information is voluntary, but is required in order to determine the borrower’s eligibility to receive a loan, and (3) identifies the third parties to whom the information may be disclosed, and explains the circumstances under which such disclosures may occur.

2 Requests for this information are in accordance with the followin g ED and OMB policies: Privacy Act of 1974, OMB Circular A - 108

– Privacy Act Implementation

– Guidelines and Responsibilities, OMB Circular A - 130 Appendix I

– Federal Agency Responsibilities for Maintaining Records About Individuals, OMB M - 03 - 22

– OMB Guid ance for Implementing the Privacy Provisions of the E - Government Act of 2002, OMB M - 06 - 15

– Safeguarding Personally Identifiable Information, OM : 6 - 104

– Privacy Act of 1974 (Collection, Use and Protection of Personally Identifiable Information)5

ICRA S Tracking and OMB Number: ( 1388 ) 1845 - 0007 Revised: 08 / 15 /2013 RIN Number: XXXX - XXXX (if applicable) 11. Provide additional justification for any questions of a sensitive nat ure, such as sexual behavior and attitudes, religious beliefs, and other matters that are commonly considered private. The justification should include the reasons wh y the agency considers the questions necessary , the specific uses to be made of the infor mation, the explanation to be given to persons from whom the information is requested, and any steps to be taken to obtain their consent. The MPN does not require a borrower to provide any information that would be considered sensitive. 12. Provide estimates of the hour burden of the collection of information. The statement should:

 Indicate the number of respondents by affected public ty

pe (federal government, individuals or households, private sector

– businesses or other for - profit, private sector

– not - for - profit institutions, farms, state, local or tribal governments) , frequency of response, annual hour burden, and an explanation of how the burden was estimated, including identification of burden type: recordkeeping, reporting or third p arty disclosure. All narrative should be included in item 12. Unless directed to do so, agencies should not conduct special survey s to obtain information on which to base hour burden estimates. Consultation with a sample (fewer than 10) of potential resp ondents is desirable. If the hour burden on respondents is expected to vary widel y because of differences in activity , size, or complexity , show the range of estimated hour burden, and explain the reasons for the variance. Generall y, estimates should not include burden hours for customary and usual business practices.  If this request for approval covers more than one form, provide separate hour burden estimates for each form and aggregate the hour burdens in the ROCI S IC Burden Analy sis Table . (The table should at minimum include Respondent types, IC activity , Respondent and Responses, Hours/Response, and Total Hours)  Provide estimates of annualized cost to respondents of the hour burdens for collections of information, identifying and using appropriate w age rate categories. The cost of contracting out or paying outside parties for information collection activities should not be included here. Instead, this cost should be included in Item 14. The Department estimates the total annual number of responden ts for this information collection to be 5,207,137. The estimated time required to complete an MPN is 0.5 hours (30 minutes). Based on one response per respondent, this equates to a total estimated annual reporting burden of 2,603,569 hours. 13. Provide an estimate of the total annual cost burden to respondents or record keepers resulting from the collection of information. (Do not include the cost of any hour burden shown in Items 12 and 14.)

 The cost estimate should be split into two components: (a) a total capital and start - up cost component (annualized over its expected useful life); and (b) a total operation and maintenance and purchase of services component. The estimates should take into account6

ICRA S Tracking and OMB Number: ( 1388 ) 1845 - 0007 Revised: 08 / 15 /2013 RIN Number: XXXX - XXXX (if applicable) costs associated with generating, maintaining, and disclosing or providing the information. Include descriptions of methods used to estimate major cost factors including s ys tem and technology acquisition, expected useful life of capital equipment, the discount rate(s), and the time period over which cost s will be incurred. Capital and start - up costs include, among other items, preparations for collecting information such as purchasing computers and software; monitoring, sampling, drilling and testing equipment; and acquiring and maintaining record storag e facilities.  If cost estimates are expected to vary widel y, agencies should present ranges of cost burdens and explain the reasons for the variance. The cost of contracting out information collection services should be a part of this cost burden estimate . In developing cost burden estimates, agencies may consult with a sample of respondents (fewer than 10), utilize the 60 - day

pre - OMB submission public comment process and use existing economic or regulatory

impact anal ys is associated with the rulemaking c ontaining the information collection, as appropriate.  Generally , estimates should not include purchases of equipment or services, or portions thereof, made: (1) prior to October 1, 1995, (2) to achieve regulatory compliance with requirements not associated with the information collection, (3) for reasons other than to provide information or keep records for the government or (4) as part of customary and usual business or private practices. Also, these estimates should not include the hourly costs (i.e., the monetization of the hours) captured above in Item 12 Total Annualized Capital/Startup Cost : Total Annual Costs (O&M) :

____________________ Total Annualized Costs Requested : There are no annual capital/startup costs to respondents, nor are there any annual costs to respondents associated with operating or maintaining systems or purchasing services. The total annual estimated cost burden for this collection is $47,906.00. This estimate was calculated by multiplying the estimated number of respondents who do not complete an electr onic MPN (104,143) by the cost of postage required to return the paper MPN ($0.46). Borrowers who complete the MPN electronically incur no postage costs. They may, however, incur minimal costs imposed by Internet providers for Internet access. The Departme nt expects that in most cases, any Internet access fees charged to borrowers for the time required to complete an MPN electronically would be less than the cost of postage. 14. Provide estimates of annualized cost to the Federal government. Also, provide a description of the method used to estimate cost, which should include quantification of hours, operational expenses (such as equipment, overhead, printing, and support staff), and any other expense that would not have been incurred without this collectio n of information. Agencies also may aggregate cost estimates from Items 12, 13, and 14 in a single table. The total estimated annual cost to the Federal government for this information collection is $ 28,172.00. This represents costs associated with print ing and distributing the paper versions of the MPN. It is not possible to provide annualized costs associated with the implementation of the electronic version of the MPN. The terms of the Department’s contract with the entity that7

ICRA S Tracking and OMB Number: ( 1388 ) 1845 - 0007 Revised: 08 / 15 /2013 RIN Number: XXXX - XXXX (if applicable) is responsible for perfo rming this function (and other functions) does not provide for itemization of costs associated with specific functions. 15. Explain the reasons for an y program changes or adjustments. Generally, adjustments in burden result from re - estimating burden and/o r from economic phenomenon outside of an agency ’ s control (e.g., correcting a burden estimate or an organic increase in the size of the reporting universe). Program changes result from a deliberate action that materiall y changes a collection of information and generally are result of new statute or an agency action (e.g., changing a form, revising regulations, redefining the respondent universe, etc.). Burden changes should be disaggregated by type of change (i.e., adjustment, program change due to new stat ute, and/or program change due to agency discretion) , ty

pe of collection (new, revision, extension, reinstatement with change, reinstatement without change) and include totals for changes in burden hours , responses and cost s (if applicable) . The Departmen t is identifying program changes based on statutory changes made to the interest rates through the Bipartisan Student Loan Certainty Act of 2013 (P.L. 113 - 28) , and the eligibility time limits made by the Moving Ahead for Progress in the 21 st Century Act (P.L. 112 - 141). We are also adding and expanding repayment plan information, deleting outdated information and supplying clearer information through updated charts and language. The Department is reporting a decrease of 31,941 hours due to a decrease in the number of respondents since the previous submission. The previous submission for this collection reported an increase in the number of respondents as a result of the Health Care and Education Reconciliation Act of 2010 (Public Law 111 - 152 ), which terminated the authority of lenders to make new FFEL Program loans effective July 1, 2010. As a result, all new subsidized/unsubsidized loan s made on or after July 1, 2010 have been made through the Direct Loan Program, and this resulted in an ini tial increase in the number of respondents completing the MPN . However, because in general a b orrower only needs to complete an MPN once to receive Direct Subsidized Loans and Direct Unsubsidized Loans for up to 10 years, there has been a decrease in the n umber of respondents since the previous submission. 16. For collections of information whose results will be published, outline plans for tabulation and publication. Address any complex analy

tical techniques that will be used. Provide the time schedule f

or the entire project, including beginning and ending dates of the collection of information, completion of report, publication dates, and other actions. The results of this information collection will not be published. 17. If seeking approval to not display the expiration date for OMB approval of the information collection, explain the reasons that display would be inappropriate. The Department is not seeking this approval. 18. Explain each exception to the certification statement identified in the Certification of Paperwork Reduction Act.8

ICRA S Tracking and OMB Number: ( 1388 ) 1845 - 0007 Revised: 08 / 15 /2013 RIN Number: XXXX - XXXX (if applicable) The Department is not requesting any exceptions to the “Certification for Paperwork Reduction Act Submissions” of OMB Form 83 - I.