55902 Federal Register / Vol. 74, No. 208 / Thursday, October 29, 2009 / Rules and Regulations 

DEPARTMENT OF EDUCATION 

[Docket ID ED–2009–OPE–0005] 

34 CFR Parts 600, 668, 675, 686, 690, 

and 692 

RIN 1840–AC99 

General and Non-Loan Programmatic 

Issues 

AGENCY: Office of Postsecondary 

Education, Department of Education. 

ACTION: Final regulations. 

SUMMARY: The Secretary amends the 

regulations for Institutional Eligibility 

Under the Higher Education Act of 

1965, the Student Assistance General 

Provisions, the Federal Work-Study 

(FWS) Programs, the Teacher Education 

Assistance for College and Higher 

Education (TEACH) Grant Program, the 

Federal Pell Grant Program, and the 

Leveraging Educational Assistance 

Partnership Program (LEAP) to 

implement various general and non-loan 

provisions of the Higher Education Act 

of 1965 (HEA), as amended by the 

Higher Education Opportunity Act of 

2008 (HEOA) and other recently enacted 

legislation. 

DATES: Effective Date: These regulations 

are effective July 1, 2010. 

Implementation date: The Secretary 

has determined, in accordance with 

section 482(c)(2)(A) of the HEA, that 

institutions may, at their discretion, 

choose to implement the new and 

amended provisions of §§ 600.32(d), 

668.28, 668.23(d)(4), 668.43, 675.16, 

675.18(g), 675.18(i), 686.41, and 686.42 

on or after November 1, 2009. For 

further information, see the section 

entitled Implementation Date of These 

Regulations in the SUPPLEMENTARY

INFORMATION section of this preamble. 

FOR FURTHER INFORMATION CONTACT: For 

general information or information 

regarding these regulations related to 

the non-title IV revenue requirement 

(90/10), John Kolotos. Telephone: (202) 

502–7762 or via the Internet at: 

John.Kolotos@ed.gov. 

For information related to all Federal 

Pell Grant Program issues and the 

LEAP/GAP Program, Fred Sellers and 

Jacquelyn Butler. Telephone: (202) 502– 

7502 and (202) 502–7890, respectively 

or via the Internet at: 

Fred.Sellers@ed.gov or 

Jacquelyn.Butler@ed.gov. 

For information related to the 

provisions for readmission for 

servicemembers, teach-outs, peer-topeer file sharing, baccalaureate in liberal 

arts, and institutional plans for 

improving the academic program, 

Wendy Macias. Telephone: (202) 502– 

7526 or via the Internet at: 

Wendy.Macias@ed.gov. 

For information related to all FWS 

Program issues, Nikki Harris and Harold 

McCullough. Telephone: (202) 219– 

7050 and (202) 377–4030, respectively, 

or via the Internet at 

Nikki.Harris@ed.gov or 

Harold.McCullough@ed.gov. 

For information related to the 

provisions for fire safety standards, 

missing students procedures, hate crime 

reporting, emergency response and 

evacuation, and students with 

intellectual disabilities, Jessica Finkel. 

Telephone: (202) 502–7647 or via the 

Internet at: Jessica.Finkel@ed.gov. 

For information related to the 

provisions for extenuating 

circumstances under the TEACH Grant 

Program, Jacquelyn Butler. Telephone: 

(202) 502–7890 or via the Internet at: 

Jacquelyn.Butler@ed.gov. 

For information related to the 

consumer information requirements, 

Brian Kerrigan. Telephone: (202) 219– 

7058 or via the Internet at: 

Brian.Kerrigan@ed.gov. 

If you use a telecommunications 

device for the deaf (TDD), call the 

Federal Relay Service (FRS), toll free, at 

1–800–877–8339. 

Individuals with disabilities can 

obtain this document in an accessible 

format (e.g., braille, large print, 

audiotape, or computer diskette) on 

request to one of the contact persons 

listed under FOR FURTHER INFORMATION

CONTACT. 

SUPPLEMENTARY INFORMATION: On August 

21, 2009, the Secretary published a 

notice of proposed rulemaking (NPRM) 

for general and non-loan programmatic 

issues in the Federal Register (74 FR 

42380). 

In the preamble to the NPRM, the 

Secretary discussed on pages 42383 

through 42415 the major regulations 

proposed in that document to 

implement provisions of the HEOA, 

including the following: 

• Amending §§ 690.63(h), 690.64, and 

690.67 to establish the conditions under 

which students may receive up to two 

Federal Pell Grant Scheduled Awards 

during a single award year. 

• Amending §§ 686.12(c), 686.41, and 

686.42(c) to establish the extenuating 

circumstances under which a TEACH 

Grant recipient may be excused from 

fulfilling all or part of his or her service 

obligation. 

• Amending § 675.18(g) to permit 

institutions to use FWS funds to 

compensate students employed in 

projects that teach civics in school, raise 

awareness of government functions or 

resources, or increase civic 

participation. 

• Amending § 675.18 by adding 

paragraph (i) to allow institutions 

located in major disaster areas to make 

FWS payments to disaster-affected 

students. 

• Amending §§ 675.41 and 675.43 to 

revise definitions and terms relating to 

work colleges. 

• Adding § 668.28 to establish the 

requirement that proprietary institutions 

derive at least 10 percent of their 

revenue from sources other than Title 

IV, HEA program funds and specify how 

institutions calculate the revenue 

percentage. 

• Amending § 668.41(a) and (d) and 

§ 668.45 to expand the information that 

institutions must make available to 

prospective and enrolled students to 

include information on: the 

employment and placement of students; 

the retention rates of first-time, full-time 

undergraduate students; the placement 

rate for any program offered by the 

institution, if the institution calculates 

this rate; and the completion and 

graduation rate data that is 

disaggregated by gender, race, and grant 

or loan assistance. 

• Amending § 668.41(e) to provide 

that institutions that maintain oncampus housing facilities must publish 

annually a fire safety report, maintain a 

fire log, and report fire statistics to the 

Department. 

• Amending § 668.46 by adding 

paragraph (h) to require institutions that 

provide on-campus housing facilities to 

develop and make available a missing 

student notification policy and allow 

students who reside on campus to 

confidentially register contact 

information. 

• Amending § 668.46(c) to expand the 

list of crimes that institutions must 

include in the hate crimes statistics 

reported to the Department. 

• Amending § 668.46 by adding 

paragraph (g) to require institutions to 

include in their annual security report 

a statement of emergency response and 

evacuation procedures. 

• Adding subpart O to 34 CFR part 

668, to specify the conditions under 

which students with intellectual 

disabilities may receive Federal Pell 

Grant, FWS, and FSEOG Program funds. 

• Adding § 668.18 to establish 

requirements under which an 

institution must readmit 

servicemembers to the same academic 

status they had when they last attended 

the institution. 

• Amending § 600.32(d) to provide 

that an institution that conducts a teachout at a site of a closed institution may, 


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under certain conditions, establish that 

site as an additional location. 

• Amending § 600.5(a) and (e) to 

include in the definition of ‘‘proprietary 

institution of higher education’’ an 

institution that provides a program 

leading to a baccalaureate degree in 

liberal arts, if the institution provided 

that program since January 1, 2009, and 

has been accredited by a regional 

accrediting agency since October 1, 

2007, or earlier. 

• Amending § 668.14(b) to provide 

that an institution must have developed 

and implemented written plans to 

effectively combat unauthorized 

distribution of copyrighted material and 

that the institution will offer 

alternatives to illegal downloading or 

peer-to-peer distribution of intellectual 

property. 

• Amending § 668.43(a) to include, as 

part of the information an institution 

must make available to prospective and 

enrolled students, a description of any 

plans the institution has to improve its 

academic program. 

• Amending § 692.10(b) to provide 

that the non-Federal share of student 

grants or work-study jobs under the 

LEAP Program must be State funds and 

that the non-Federal share no longer has 

to come from a direct appropriation of 

State funds. 

• Amending § 692.21(k) to provide 

that the State program must notify 

students that grants are LEAP Grants 

that are funded by the Federal 

Government, the State, and, for LEAP 

Grants to students under the new Grants 

for Access and Persistence (GAP) 

Program, other contributing partners. 

• Adding subpart C to 34 CFR part 

692 to establish the activities, awards, 

allotments to States, matching funds 

requirements, consumer information 

requirements, application requirements, 

and other requirements needed to begin 

and continue participating in the GAP 

Program. 

Technical Amendments 

In addition to the changes necessary 

to implement provisions of the HEOA, 

these final regulations also incorporate 

technical amendments made to the HEA 

by The Higher Education Technical 

Corrections (Pub. L. 111–39), enacted on 

July 1, 2009. These changes are as 

follows: In § 690.75(e) we proposed that 

a student whose parent was in the 

Armed Forces and died in Iraq or 

Afghanistan could receive the maximum 

Federal Pell Grant eligibility if the 

student was under 24 years old or 

enrolled in an institution of higher 

education at the time the parent died, in 

accordance with section 401(f)(4) of the 

HEA, as amended by the HEOA. 

However, Public Law 111–39 removed 

section 401(f)(4) from the HEA and 

added new sections 473(b) and 420R 

effective July 1, 2009. Section 401(f)(4) 

provided that, for purposes of Federal 

Pell Grants only, a student was deemed 

to have an expected family contribution 

(EFC) of zero if the student’s parent was 

in the Armed Forces and died in Iraq or 

Afghanistan when the student was 

under 24 years old or enrolled in an 

institution of higher education at the 

time the parent died. 

Section 473(b) was added to Part F— 

Need Analysis of the HEA and provides 

that, beginning with the 2009–2010 and 

succeeding award years, each student 

with a Federal Pell Grant-eligible EFC 

whose parent or guardian was a member 

of the Armed Forces of the United States 

and died as a result of performing 

military service in Iraq or Afghanistan 

after September 11, 2001, will be 

determined to have an EFC of zero that 

will generally apply to all Title IV, HEA 

programs. Because part F of the HEA, 

where these changes are reflected, is 

subject to section 478(a) of the HEA, 

which generally prohibits regulating the 

requirements in part F, we are removing 

proposed § 690.75(e). 

Section 420R of the HEA establishes 

a new, non-need-based program called 

the Iraq and Afghanistan Service Grants 

Program (IASG Program) starting in the 

2010–2011 award year. To qualify for an 

IASG, a student must have a parent or 

guardian who died as a result of military 

service in Iraq or Afghanistan after 

September 11, 2001, and must be, at the 

time of the parent or guardian’s death, 

less than 24 years of age or enrolled at 

an institution of higher education. A 

qualifying student who is not eligible 

for a Federal Pell Grant would be 

eligible to receive an IASG that is the 

same amount as a maximum Federal 

Pell Grant to assist in paying the 

student’s cost of attendance at an 

institution of higher education. Grants 

under the IASG Program may not 

exceed the student’s cost of attendance, 

and payments are adjusted like Federal 

Pell Grants if the student is enrolled less 

than full-time; unlike Federal Pell 

Grants, IASG Program grants are not 

considered to be estimated financial 

assistance. Under this program, the 

student’s EFC will not be changed as a 

result of a parent or guardian’s service. 

Regulations are necessary to implement 

this Title IV, HEA program. However, 

section 409 of Public Law 111–39 

waives the provisions of sections 482 

and 492 of the HEA concerning the 

master calendar for regulatory effective 

dates and the requirement to use 

negotiated rulemaking to formulate 

regulations for the IASG Program. We, 

therefore, expect to initiate the 

regulatory process without negotiated 

rulemaking and adopt the necessary 

regulations that would be effective on 

July 1, 2010, for the 2010–2011 award 

year. 

• Section 401(a)(6) of Public Law 

111–39 also amended section 

415E(b)(1)(B) of the HEA governing 

allotments to States under the Grants for 

Access and Persistence Program (GAP). 

The allotment formula provides that a 

State with a prior year allotment shall 

receive not less than that amount in the 

next year’s allotment. The HEA provides 

that, if a State received an allotment for 

2010–2011 under 34 CFR part 692, 

subpart B, the Special Leveraging 

Educational Assistance Partnership 

Program (SLEAP), the State’s 2011–2012 

allotment for the GAP Program shall not 

be less than its 2010–2011 SLEAP 

allotment. We are revising § 692.110(a) 

to reflect this statutory change. We are 

also revising appendix A to subpart C of 

part 692 that provides a case study 

illustrating the requirements for 

allotting funds under the GAP Program 

to reflect these changes to the 

regulations. 

We have also made a number of minor 

technical corrections and conforming 

changes. Changes that are statutory or 

that involve only minor technical 

corrections are generally not discussed 

in the Analysis of Comments and 

Changes section. 

Waiver of Proposed Rulemaking for 

Additional Conforming Changes 

These final regulations incorporate a 

statutory change made to the HEA by 

the HEOA that was not included on 

Team V’s negotiating agenda or in the 

NPRM published on August 21, 2009. 

However, this statutory change in 

section 485(h) of the HEA is referenced 

in § 602.24 of the Team III 

(Accreditation) final regulations 

published in the Federal Register as 

Docket ID ED–2009–OPE–0009. We are 

amending § 668.43(a) of these 

regulations to reflect the statutory 

provisions by adding new paragraph 

(a)(11). 

We are also amending § 690.6 by 

adding paragraph (e) to reflect a 

statutory change made by the HEOA to 

section 401(c)(5) of the HEA. Section 

690.6(e) provides that, if a student 

receives a Federal Pell Grant for the first 

time on or after July 1, 2008, the student 

may receive no more than the 

equivalent of nine Scheduled Awards. 

Because these amendments 

implement changes to the HEA that 

were not negotiated, we do not discuss 

them in the Analysis of Comments and 

Changes section. 


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55904 Federal Register / Vol. 74, No. 208 / Thursday, October 29, 2009 / Rules and Regulations 

Under the Administrative Procedure 

Act (5 U.S.C. 553) (APA), the 

Department is generally required to 

publish a notice of proposed rulemaking 

and provide the public with an 

opportunity to comment on proposed 

regulations prior to issuing final 

regulations. In addition, all Department 

regulations for programs authorized 

under title IV of the HEA are subject to 

the negotiated rulemaking requirements 

of section 492 of the HEA. However, 

both the APA and the HEA provide for 

exemptions from these rulemaking 

requirements. The APA provides that an 

agency is not required to conduct 

notice-and-comment rulemaking when 

the agency for good cause finds that 

notice and comment are impracticable, 

unnecessary, or contrary to the public 

interest. Similarly, section 492 of the 

HEA provides that the Secretary is not 

required to conduct negotiated 

rulemaking for Title IV, HEA program 

regulations if the Secretary determines 

that applying that requirement is 

impracticable, unnecessary, or contrary 

to the public interest within the 

meaning of the HEA. 

Although the regulations 

implementing the HEOA are subject to 

the APA’s notice-and-comment and the 

HEA’s negotiated rulemaking 

requirements, the Secretary determined 

that it was unnecessary to conduct 

negotiated rulemaking or notice-andcomment rulemaking on the changes 

needed in § 668.43. These changes 

simply amend the Department’s 

regulations to reflect statutory changes 

made by the HEOA to paragraph (h) of 

section 485 of the HEA, and these 

changes are already effective. The 

Secretary does not have discretion in 

whether or how to implement these 

changes. Accordingly, negotiated 

rulemaking and notice-and-comment 

rulemaking are unnecessary. 

Implementation Date of These 

Regulations 

Section 482(c) of the HEA requires 

that regulations affecting programs 

under title IV of the HEA be published 

in final form by November 1 prior to the 

start of the award year (July 1) to which 

they apply. However, that section also 

permits the Secretary to designate any 

regulation as one that an entity subject 

to the regulation may choose to 

implement earlier and the conditions 

under which the entity may implement 

the provisions early. 

Consistent with the intent of this 

regulatory effort to strengthen and 

improve the administration of the Title 

IV, HEA programs, the Secretary is 

using the authority granted him under 

section 482(c) of the HEA to designate 

the following new and amended 

provisions for early implementation, at 

the discretion of each institution, 

lender, guaranty agency, or servicer, as 

appropriate: 

• The closed school teach out 

provisions in § 600.32(d). 

• The readmission requirements for 

returning servicemembers in § 668.18. 

• The 90/10 revenue requirements in 

§§ 668.28 and 668.23(d)(4). 

• The institutional information 

requirements in § 668.43. 

• The FWS provisions in §§ 675.16, 

675.18(g), and 675.18(i). 

• The teach grant provisions 

regarding extenuating circumstances in 

§§ 686.12, 686.41, and 686.42. 

In addition, the revisions to §§ 690.63, 

690.64, and 690.67 of the Federal Pell 

Grant Program regulations may apply to 

the crossover payment period that is in 

both the 2009–10 and 2010–11 award 

years, i.e., a payment period that 

includes June 30, 2010, and July 1, 

2010. If an institution does not 

implement these regulations prior to 

July 1, 2010, but, prior to July 1, 2010, 

designates a student’s 2010 crossover 

payment period as being in the 2009–10 

award year, the Secretary does not 

consider these revisions to be applicable 

to the crossover payment period. 

Nothing will prevent the institution 

from subsequently designating the 2010 

payment period as being in the 2009–10 

award year with the revisions to 

§§ 690.63, 690.64, and 690.67 then being 

applicable. 

Analysis of Comments and Changes 

Except as noted under Waiver of 

Proposed Rulemaking for Additional 

Conforming Changes, the regulations in 

this document were developed through 

the use of negotiated rulemaking. 

Section 492 of the HEA requires that, 

before publishing any proposed 

regulations to implement programs 

under title IV of the HEA, the Secretary 

must obtain public involvement in the 

development of the proposed 

regulations. After obtaining advice and 

recommendations, the Secretary must 

conduct a negotiated rulemaking 

process to develop the proposed 

regulations. The negotiated rulemaking 

committee did not reach consensus on 

the proposed regulations that were 

published on August 21, 2009. The 

Secretary invited comments on the 

proposed regulations by September 21, 

2009. More than 113 parties submitted 

comments, a number of which were 

substantially similar. An analysis of the 

comments and of the changes in the 

regulations since publication of the 

NPRM follows. 

We group major issues according to 

subject, with appropriate sections of the 

regulations referenced in parentheses. 

We discuss other substantive issues 

under the sections of the regulations to 

which they pertain. Generally, we do 

not address minor, non-substantive 

changes, recommended changes that the 

law does not authorize the Secretary to 

make, or comments pertaining to 

operational processes. We also do not 

address comments pertaining to issues 

that were not within the scope of the 

NPRM. 

Part 600 Institutional Eligibility Under 

the Higher Education Act of 1965, as 

Amended 

Definition of Baccalaureate Liberal Arts 

Programs Offered by Proprietary 

Institutions (§ 600.5) 

Comments: One commenter 

supported the proposed change, stating 

that it was a reasonable way to clarify 

the term program leading to a 

baccalaureate degree in liberal arts. One 

commenter stated that the requirement 

that an institution ‘‘has provided that 

program since January 1, 2009’’ should 

be interpreted to mean that any new 

liberal arts program added from January 

1, 2009, forward will qualify an 

otherwise eligible institution as an 

eligible proprietary institution, so long 

as the institution has been accredited by 

a recognized regional accrediting agency 

or association since October 1, 2007, or 

earlier. 

Discussion: The Department does not 

agree that the requirement that the 

institution ‘‘has provided that program 

since January 1, 2009’’ should be 

interpreted to mean that any new liberal 

arts program added from January 1, 

2009, forward will qualify an otherwise 

eligible institution as an eligible 

proprietary institution. Rather, the 

requirement means that an institution 

was providing the program (i.e., was 

enrolling students in the program) on 

January 1, 2009, and has continued to 

do so. 

Changes: Section 600.5(a)(5)(i)(B)(1) 

has been revised to clarify that an 

institution meets the definition of a 

proprietary institution of higher 

education if, in addition to being 

accredited by a recognized regional 

accrediting agency or association 

continuously since October 1, 2007, it 

has provided a program leading to a 

baccalaureate degree in liberal arts 

continuously since January 1, 2009. 


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Institutional Requirements for TeachOuts and Eligibility and Certification 

Procedures (§§ 600.2, 600.32, 668.14) 

Comments: Several commenters 

supported the proposed changes. One 

commenter stated that § 600.32(d) 

should be expanded to provide that the 

exemptions from the two-year in 

existence requirement, the assumption 

of liabilities, and the assumption of the 

cohort default rate apply when an 

institution conducts a teach-out at an 

institution that closes because a 

guaranty agency initiated an action to 

limit, suspend, or terminate (LS&T) the 

participation of an institution, or took 

an emergency action against the 

institution. One commenter explained 

that a closing can be a very confusing 

time for students if they were not given 

accurate information about what was 

happening at their institution, and 

urged the Department to monitor closely 

the process for establishing an 

additional location under these 

regulations. The commenter noted that 

accurate and effective communication to 

students is especially critical when the 

teach-out institution is establishing a 

permanent location at a closed 

institution. The commenter asserted that 

an institution establishing a permanent 

location at the site of a closed 

institution must be able to provide a 

teach-out option that meets appropriate 

quality standards even in cases when 

the prior institution did not meet these 

standards. The commenter stated that 

the mere submission of a teach-out plan 

should not be viewed as evidence that 

these standards were met for purposes 

of the closed school discharge. 

Discussion: LS&T and emergency 

actions initiated by a guaranty agency 

against an institution are promptly 

reported to the Department, and the 

Department investigates those reports to 

determine whether to initiate a separate 

LS&T or emergency action against the 

institution. Therefore, we do not believe 

it is necessary to include as a trigger an 

LS&T or emergency action initiated by 

a guaranty agency that would provide 

the two-year requirement, liability, and 

default rate exemptions to an institution 

conducting a teach-out at a closed 

institution. Because of the interplay 

between the actions taken by a guaranty 

agency and the Department, there may 

be some instances when an institution 

may close prior to the Department 

initiating an LS&T or emergency action. 

In other instances, an institution may 

close precipitously before the 

Department has time to initiate an 

appropriate action under the 

circumstances. To address these 

instances, the final regulations have 

been modified so that the action taken 

by the Department may be initiated after 

the institution closes. The Department 

recognizes that a school closure and 

teach-out can be a confusing time for 

students, and intends to work closely 

with the States and accrediting agencies 

to make sure that students are given 

accurate information about their options 

during this transition. The opportunity 

for another institution to perform the 

teach-out, and open a permanent 

location under this exemption, should 

also ensure that the teach-out is 

adequately staffed and designed to serve 

the students that attended the closed 

school. 

Changes: Section 600.32(d)(1)(i) is 

revised to clarify that an institution that 

conducts a teach-out at a site of a closed 

institution may apply to have that site 

approved as an additional location if the 

closed institution ceased operations 

because the Secretary has taken an 

LS&T or emergency action, regardless of 

whether the Secretary took that action 

before or after the institution closed. 

Part 668 Student Assistance General 

Provisions 

Readmission Requirements for 

Servicemembers (§ 668.18) 

Comments: One commenter 

supported the proposed regulations, 

including the proposed requirement 

limiting the institutional charges that an 

institution may charge a returning 

servicemember. Several commenters 

opposed the proposed requirement 

limiting the institutional charges that an 

institution may charge a returning 

servicemember because they stated it 

would be administratively and 

financially burdensome for institutions. 

For the same reason, some of these 

commenters also opposed the 

requirement that an institution waive 

charges for previously purchased 

equipment for the first academic year in 

which the servicemember returns if the 

returning servicemember is readmitted 

to the same program for the same 

reason. Many of these commenters 

asserted that, because many of the 

affected servicemembers will receive 

full tuition and fee benefits under the 

Post-9/11 GI Bill, charging the returning 

servicemember the current institutional 

charges for a program, rather than the 

same charges that the returning 

servicemember was or would have been 

assessed for the academic year during 

which he or she left the institution, will 

not penalize the student for having left 

to serve in the uniform services. One 

commenter added that this argument is 

supplemented by the fact that at least 

one State waives any tuition charges not 

paid by the GI Bill at public 

universities. One of these commenters 

stated that limiting charges to the first 

year only would create an unrealistic 

expectation for returning 

servicemembers for the full cost of the 

program. A few of the commenters 

stated that limiting institutional charges 

for returning servicemembers would be 

unfair to other students at the 

institution who would assume higher 

costs, or noted that the proposed 

requirement could preempt State 

requirements. 

Several commenters asserted that the 

forced manual billing determinations 

that the regulations would require of 

institutions would be unduly 

burdensome as the billing software used 

by most institutions, which uses preprogrammed data, including current 

year charges, does not accommodate 

special case situations, such as the 

proposed regulations would create. 

Specifically, a few commenters noted 

that institutions would be forced to 

maintain multi-faceted data tables over 

an undetermined number of years to 

recreate the prior institutional charges 

for servicemembers who may or may not 

return, as institutions do not keep 

student financial records for the entire 

period covered by the readmission 

requirements and billing systems are not 

designed to archive the data necessary 

to calculate institutional charges years 

later. The commenters contended that, 

even if an institution has all the 

information necessary, recreating the 

institutional charges would be 

complicated as institutional charges 

cover many types of charges involving 

variations by program. One commenter 

asserted that some Department of 

Defense tuition assistance systems, such 

as GoArmy, do not allow variations in 

tuition rates and could potentially delay 

tuition assistance processing for both 

impacted and nonimpacted 

servicemembers. A few commenters 

stated that determining institutional 

charges for returning servicemembers 

who may have been admitted, but were 

not enrolled or attending prior to 

leaving to serve, would be particularly 

difficult as they had never incurred 

specific charges, with one of these 

commenters noting that their institution 

has an open admission policy resulting 

in a large number of these students. 

One commenter generally supported 

the requirement limiting the 

institutional charges that an institution 

may charge a returning servicemember, 

but stated that an institution should be 

permitted to charge a returning 

servicemember for new classes when a 

program has changed, requiring the 

servicemember to take additional 


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classes in the form of prerequisites or 

new requirements. A few commenters 

noted that requiring an institution to 

provide, if necessary, refresher courses 

at no extra cost seemed to preclude an 

institution from collecting funding from 

other entities to cover those expenses. 

One commenter stated that requiring an 

institution to make reasonable efforts to 

help the servicemember become 

prepared to resume the program or to 

enable the servicemember to complete 

the program at no extra cost, would 

impose an undue financial hardship and 

administrative burden on the 

institution. The commenter asserted 

that, when there is only the normal 

reasonable progression from one year to 

the next, rather than any actual change 

to the program in the servicemember’s 

absence, it is the servicemember’s 

responsibility to retain the knowledge 

attained in the normal course of 

educational progression. In addition, the 

commenter stated that the definition of 

‘‘reasonable efforts’’ is ambiguous and 

would be difficult to determine. 

Discussion: The Department believes 

that the goal of these provisions is to 

minimize the disruption to the lives of 

persons performing service in the 

uniformed services, allowing a 

servicemember to return to an 

institution without penalty for having 

left because of that service. We believe 

that limiting charges for the year in 

which the servicemember returns to the 

charges the servicemember was or 

would have been assessed for the 

academic year during which the 

servicemember left is an important part 

of this goal, and may necessitate 

additional efforts by institution as well 

as the absorption of some costs. 

However, we agree that this goal would 

still be achieved if any increase in 

charges from the amount the 

servicemember was or would have been 

assessed for the academic year during 

which the servicemember left the 

institution is covered by veterans’ or 

servicemember education benefits. In 

addition, we believe that requiring 

institutions to maintain only past 

tuition and fee charges, rather than 

requiring them to maintain all 

institutional charges and waive charges 

for new equipment required in lieu of 

equipment previously paid for, will 

accomplish this goal, while minimizing 

burden to institutions that may have 

had difficulty determining the previous 

institutional charges beyond tuition and 

fees, as well as difficulty determining 

which of the current institutional 

charges beyond tuition and fees would 

be covered by veterans’ and 

servicemember education benefits. 

Therefore, for a servicemember who is 

readmitted to the same program, an 

institution will be considered to have 

admitted the servicemember with the 

same academic status if, for the first 

academic year in which the 

servicemember returns, the institution 

does not increase the tuition and fee 

charges above the prior amount the 

servicemember was or would have been 

assessed for the academic year when the 

servicemember left the institution, 

unless there are sufficient veterans’ 

education benefits or other 

servicemember education benefits to 

pay the increased amount of those 

tuition and fee charges. Consider, for 

example, a servicemember who is 

readmitted to the same program and was 

assessed tuition and fee charges of 

$5,000 for the academic year when the 

servicemember left the institution. The 

current tuition and fee charges for the 

program are $7,000, a $2,000 increase 

over the charges formerly assessed the 

student. In addition to the original 

$5,000 in charges, the institution may 

charge the readmitted servicemember 

for any portion of that $2,000 increase 

that will be covered by veterans’ 

education benefits or other 

servicemember education benefits. If 

this student receives $1,000 in veterans’ 

education benefits or other 

servicemember education benefits for 

tuition and fees, the institution may 

assess the student tuition and fee 

charges of up to $6,000. If the student 

receives $2,000 or more in veterans’ 

education benefits or other 

servicemember education benefits for 

tuition and fees, the institution may 

assess up to $7,000, the tuition and fee 

charges for other students admitted to 

the program for the current academic 

year. This approach will significantly 

reduce the burden on institutions to 

track many of the variable charges that 

were included in the proposed 

regulation, and will simplify the 

determinations of what tuition or fee 

amounts would be subject to the oneyear transition period for a returning 

servicemember. The portion of tuition 

and fees that are subject to this 

temporary restriction may also be 

reduced or eliminated by other policies 

set by the institution, or under State 

law, but the Federal requirement will 

provide a consistent base line for all 

institutions in every State and serve the 

purpose intended by this provision in 

the law. 

We agree that students who are not 

informed of any increase in tuition and 

fee charges for subsequent years may 

have unrealistic expectations of the total 

cost of the program. We would expect 

that an institution would actively 

inform affected servicemembers upon 

readmission of any subsequent increase 

and the total expected charges for the 

program (an institution is required to 

make this information available at all 

times and include it in its annual 

distribution of institutional and 

financial information to all enrolled 

students in accordance with § 668.41(c) 

and (d)). To the extent that this 

temporary restriction on the amount of 

tuition and fees for returning 

servicemembers is a benefit not 

provided to the other students at an 

institution, it is provided under the law 

to ease the transition back to the 

institution for the returning 

servicemembers. We also believe that 

this provision will not create conflicts 

for benefits provided to other 

servicemembers under the GoArmy 

education program. 

Although we appreciate that current 

institutional billing software may not 

easily accommodate affected 

servicemembers, we believe that any 

burden incurred by an institution that 

must manually process such a student is 

outweighed by the benefit to the 

returning servicemember. We also 

believe that limiting the covered costs to 

tuition and fees significantly simplifies 

this provision for institutions. 

In accordance with § 668.18(a)(2)(iv), 

an institution may not charge a 

returning servicemember for additional 

classes offered by the institution that are 

prerequisites for the program. The 

institution does not have to readmit 

such a servicemember if the institution 

can demonstrate that providing the 

classes at no cost places an undue 

hardship on the institution. If new 

classes are required for the program and 

those classes are taken by the 

servicemember in the academic year in 

which he or she returns, the institution 

may not charge the additional tuition 

and fees for those programs unless 

doing so does not increase the tuition 

and fee charges above the prior amount 

the student was or would have been 

assessed for the academic year when he 

or she left the institution, or there are 

sufficient veterans’ education benefits or 

other servicemember education benefits 

to pay the increased amount of those 

tuition and fee charges. In requiring an 

institution to provide, if necessary, 

refresher courses at no extra cost, we 

did not intend to preclude an institution 

from collecting funding from other 

assisting agencies to cover those 

expenses. Also, we note that any 

reasonable efforts an institution must 

make to help the student become 

prepared to resume the program, or to 

enable the student to complete the 


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program must be provided at no extra 

cost to the student. We do not agree that 

requiring an institution to make 

reasonable efforts to help a 

servicemember become prepared to 

resume the program or to enable the 

servicemember to complete the program 

at no extra cost, would automatically 

impose an undue financial hardship and 

administrative burden on the 

institution, nor do we agree that, in 

cases where there is only the normal 

reasonable progression from one year to 

the next, rather than any actual change 

to the program in the servicemember’s 

absence, it is the servicemember’s 

responsibility to retain the knowledge 

attained in the normal course of 

educational progression. Again, the goal 

of these provisions is to minimize the 

disruption to the lives of persons 

performing service in the uniformed 

services, allowing a servicemember to 

return to an institution without penalty 

for having left because of that service. 

Holding a servicemember responsible 

for retaining all knowledge attained 

through previous attendance of the 

program would be penalizing the 

servicemember for having left to serve. 

‘‘Reasonable efforts’’ are actions that do 

not place an undue hardship on an 

institution. An action places an undue 

hardship on an institution if it requires 

significant difficulty or expense to the 

institution. The mere fact that the 

readmission of a student will create 

additional expenses or burden to the 

institution is not enough for an 

institution to deny a student 

readmission. The expenses must be 

significant when considered in light of 

the overall financial resources of the 

institution and the impact otherwise of 

such action upon the operation of the 

institution. An institution carries the 

burden to prove by a preponderance of 

the evidence that the expense or 

difficulty of readmitting a student 

would be significant. 

Changes: Section 668.18(a)(2)(iii)(E) is 

revised to provide that, for a 

servicemember who is readmitted to the 

same program, an institution will be 

considered to have admitted the 

servicemember with the same academic 

status if, for the first academic year in 

which he or she returns, the institution 

does not increase the tuition and fee 

charges above the prior amount the 

student was or would have been 

assessed for the academic year when the 

student left the institution, unless there 

are sufficient veterans’ education 

benefits or other servicemember 

education benefits to pay the increased 

amount of those tuition and fee charges. 

Proposed § 668.18(a)(2)(iii)(F), which 

would have required an institution to 

waive charges for previously purchased 

equipment, is removed. Section 

668.18(a)(2)(iv)(A) has been revised: (1) 

To make clear that any reasonable 

efforts an institution must make to help 

the servicemember become prepared to 

resume the program, or to enable the 

servicemember to complete the program 

must be provided at no extra cost, and 

(2) to make clear that those efforts must 

be provided at no extra cost to the 

student, to permit an institution to 

collect from other entities for costs 

associated with making such reasonable 

efforts. The definition of undue 

hardship in § 668.18(a)(2)(iv)(C)(2) is 

amended to clarify that difficulty and 

expenses must be significant when 

considered in light of the overall 

financial resources of the institution and 

the impact otherwise of such action on 

the operation of the institution. 

Comments: One commenter asked 

what would be required of an institution 

to ‘‘promptly readmit’’ an affected 

servicemember if the program to which 

the servicemember was previously 

admitted is offered infrequently, or is no 

longer offered. One commenter asked 

how long a servicemember may delay 

readmission to an institution by 

requesting to be readmitted at a later 

date, and at what point the institutional 

charges would be locked in. The 

commenter also questioned whether the 

unusual circumstances under which an 

institution may admit a servicemember 

at a date later than the next class or 

classes in the program pertain to the 

institution or just to the servicemember. 

Discussion: If the program to which 

the servicemember was previously 

admitted is no longer offered, 

§ 668.18(a)(2)(iii)(A) requires the 

institution to admit the servicemember 

to the program that is most similar to 

that program, unless the student 

requests or agrees to admission to a 

different program. An institution 

readmits a servicemember ‘‘promptly’’ 

if, in accordance with § 668.18(a)(2)(ii), 

the institution readmits the 

servicemember into the next class or 

classes in the program beginning after 

he or she provides notice of his or her 

intent to re-enroll, unless the 

servicemember requests a later date of 

readmission or unusual circumstances 

require the institution to admit the 

servicemember at a later date. 

These regulations presume that a 

returning servicemember who provides 

notice of his or her intent to reenroll at 

an institution plans to do so soon after 

providing such notice. The provision 

that an institution must admit a 

returning servicemember to the next 

class or classes in the student’s program 

unless the student requests a later date 

of admission was included to ensure 

that an institution could not delay a 

servicemember’s readmission until, for 

example, the next semester if classes in 

the student’s program were offered 

during the upcoming semester. 

However, the regulations do not 

preclude the returning servicemember 

from deciding that a later admission 

date, such as the next semester, is 

acceptable. No matter when the student 

actually resumes his or her program, if 

the returning servicemember is within 

the window of eligibility in 

§ 668.18(c)(iii), the requirements of this 

section apply. Thus, for the first 

academic year in which the 

servicemember returns, the institution 

cannot increase the tuition and fee 

charges above the prior amount the 

servicemember was or would have been 

assessed for the academic year when the 

servicemember left the institution, 

unless there are sufficient veterans’ 

education benefits or other 

servicemember education benefits to 

pay the increased amount of those 

tuition and fee charges. Unusual 

circumstances under which an 

institution may admit a servicemember 

at a date later than the next class or 

classes in the program may pertain to 

the institution or to the servicemember. 

There are a number of factors an 

institution may consider when 

determining whether unusual 

circumstances require a later date of 

readmission, such as the length of any 

necessary retraining or intervening 

changes in the circumstances of the 

institution. State laws or requirements 

(including any local law or ordinance) 

or institutional requirements that 

restrict enrollment, due to class size, for 

example, or otherwise conflict with the 

requirements of this section are not 

‘‘unusual circumstances’’ as such laws 

and requirements are superseded by the 

requirements of this section for the 

initial enrollment period. Institutions 

should take reasonable steps to resolve 

such restrictions as soon as possible to 

come into compliance with those 

provisions. 

Changes: None. 

Non-Title IV Revenue Requirement 

Compliance Audits and Audited 

Financial Statements (§ 668.23) 

Comments: A few commenters asked 

the Department to clarify the proposed 

requirement in § 668.23(d)(4) under 

which a proprietary institution must 

disclose in a footnote to its audited 

financial statements the 90/10 revenue 

percentage and the components of that 

percentage. The commenters suggested 


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that the Department specify that the 

reference in the regulations to Federal 

revenue means Title IV, HEA revenue 

and confirm their understanding that an 

institution must disclose: (1) The dollar 

amount of the numerator and 

denominator of the 90/10 ratio; (2) the 

dollar amount of the temporary relief 

attributed to institutional loans under 

the Net Present Value (NPV) calculation; 

and (3) the amount of loan funds that 

exceed the loan limits in effect before 

ECALSA that are treated as non-Federal 

revenue in the denominator of the 90/ 

10 ratio. 

Discussion: Under proposed 

§ 668.23(d)(4), a proprietary institution 

would have to disclose, by source, the 

amount of Federal and non-Federal 

revenue the institution included in its 

90/10 calculation. We are amending the 

regulations to clarify that ‘‘source’’ 

means the individual categories of 

revenues identified in Appendix C to 

subpart B of part 668. To calculate its 

90/10 percentage, an institution would 

have to compile the information 

detailed in Appendix C, particularly the 

aggregated and adjusted amounts in 

section 2. We therefore believe that it is 

reasonable to require the institution to 

disclose this information. Given the 

added complexities that come from 

these additional categories of revenue, 

disclosing the institution’s calculation 

will simplify the presentation in the 

financial statements and facilitate the 

review of that information by the 

Department. 

Changes: Section 668.23(d)(4) is 

amended to provide that a proprietary 

institution must disclose in a footnote to 

its audited financial statements, the 

dollar amount of the numerator and 

denominator of its 90/10 ratio as well as 

the individual revenue amounts 

identified in section 2 of Appendix C to 

part 668. 

Revenue Generated From Programs and 

Activities (§ 668.28) 

Comments: One commenter asked the 

Department to clarify whether the 

revenue from students taking a course 

offered by an institution as part of an 

eligible Title IV, HEA educational 

program counts for 90/10 purposes if 

the students are taking the course to 

prepare for an industry recognized 

credential or to transfer to another 

institution. For example, students that 

are not enrolled in a Title IV, HEAeligible program take an Accounting 400 

course, normally offered as part of a 

Title IV, HEA-eligible accounting 

program, as a refresher course to sit for 

the Certified Public Accounting exam or 

to transfer the credits from the course to 

another institution. 

Discussion: An institution may count 

the revenue described by the commenter 

as long as the course or program is 

offered for the purpose of preparing 

students for taking an examination for 

an industry recognized credential, or for 

any other purpose described in 

§ 668.28(a)(3)(iii) that would otherwise 

qualify the revenue from that course or 

program to be included in the 90/10 

calculation. However, payments from a 

student taking the class for transfer 

credits would not count as revenue 

because the student is not taking the 

class for any of these purposes. An 

institution should make sure that it 

appropriately documents any revenue 

the institution includes from these 

classes in its 90/10 calculation. 

Changes: None. 

Revenue Generated From Institutional 

Aid (§ 668.28) 

Comments: A few commenters asked 

the Department to clarify whether 

installment sales contracts are 

considered to be loans made to students 

under § 668.28(a)(5)(i). Other 

commenters noted that funds are not 

advanced to a student under an 

installment sales contract, and funds are 

not paid in full to a student’s account. 

Rather, an installment sales contract is 

paid over time by the student to the 

institution. As a result, the commenters 

concluded that installment sales 

contracts should not be treated as loans 

under the NPV formula. 

Some commenters asked for 

clarification of the preamble discussion 

(74 FR 42390) regarding the disposition 

of third-party loans made to students 

that are subsequently acquired by the 

institution. 

Other commenters urged the 

Department to reconsider the provision 

in § 668.28(a)(5)(iv) that a tuition 

discount is a form of a scholarship that 

must be disbursed from a restricted 

account with funds from an outside 

source. The commenters stated that 

treating a tuition discount in this way is 

inconsistent with the intent of the 

HEOA and would encourage students to 

incur more debt. 

A few commenters asked the 

Department to clarify that payments 

made by students on financing 

arrangements that do not qualify as 

institutional loans count as cash 

collected by the institution for 90/10 

purposes. 

Discussion: An installment sales 

contract was included in the proposed 

regulations because we believed that it 

could be structured to satisfy all of the 

conditions of an institutional loan that 

were set forth in proposed 

§ 668.28(a)(5)(i). However, although we 

noted in the preamble to the NPRM (74 

FR 42389) that, to be included in the 

NPV calculation, an installment sales 

contract that would be classified as an 

institutional loan would have to be 

credited in full to the student’s account, 

this condition was not included in the 

proposed regulations. To address the 

confusion reflected in the comments 

over the qualifying conditions for 

institutional loans, and the general 

public view that a typical installment 

sales contract does not provide for funds 

to be credited to a student’s account, we 

agree to remove installment sales 

contracts from this section of the 

regulations. 

With regard to a loan made by a third 

party to a student at an institution, in 

the normal course, the proceeds of the 

loan would be credited to the student’s 

account, and the amount credited that 

paid for tuition and fees not covered by 

Title IV, HEA aid would count as nonTitle IV, HEA revenue in the 90/10 

calculation. If the institution made the 

same loan itself, it would only be 

permitted to count the NPV of the loan 

in the 90/10 calculation. In both cases 

the institution has credited loan 

proceeds of the same value to the 

student’s account but the institution 

would derive a greater benefit for 90/10 

purposes from the loan that was made 

by the third party. For example, 

assuming the loan proceeds from a third 

party pay $1,000 for tuition and fees not 

covered by Title IV, HEA aid, the entire 

$1,000 is counted as non-Federal 

revenue for 90/10 purposes. If the 

institution made the same loan, the 

amount of funds counted as non-Federal 

revenue would be less because of the 

NPV calculation. For instance, if the 

institution uses the simpler alternative 

NPV approach, the amount of the nonFederal revenue would be $500 or 50% 

of the loan. This different treatment of 

the loan proceeds is based upon which 

party is making the loan to the student 

without transferring it afterwards to, or 

from, the institution. These provisions 

are not intended to permit an institution 

to arrange with a third party to transfer 

student loans after they are made in 

order to distort the way the revenue 

from those loans is treated under this 

provision. To equalize the outcome 

between an institution and a third party 

making and purchasing a loan, an 

institution that purchases a student loan 

must treat it for 90/10 purposes as if the 

institution made the loan itself. 

Similarly, if an institution makes a 

loan and transfers it to a third party, the 

Department would not view that loan as 

a loan that could be included in any 

NPV calculation pursuant to section 

487(d)(1)(d)(III) of the HEA. That section 


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requires a loan that is included in the 

NPV calculation to be subject to regular 

loan repayment and collection. Any 

institutional loan that is sold to a third 

party within a year of when it was made 

must be treated for 90/10 purposes as a 

loan made by a third party. The amount 

the institution may count as nonFederal revenue may not be more than 

the amount paid to the institution for 

that loan, less any amount the 

institution agrees to pay the third party 

if the loan goes into default or otherwise 

triggers a contingent payment by the 

institution. Consistent with the 

Department’s current treatment of 

recourse loans and the requirement to 

use the cash basis of accounting, the 

institution must adjust its 90/10 revenue 

for any such payment on an 

institutional loan in the fiscal year when 

the payment is made. 

We disagree with the commenters that 

the proposed regulations regarding 

tuition discounts are inconsistent with 

the intent of the law. The regulations 

simply reflect section 487(d)(1)(D)(iii) of 

the HEA by specifying that an 

institution may include scholarships as 

revenue if the scholarships are 

disbursed from an established restricted 

account and that funds in that account 

represent designated funds from an 

outside source or from income earned 

on those funds. That section of the HEA 

states that scholarships may be provided 

by an institution in the form of 

monetary aid or tuition discounts. 

With regard to financing arrangements 

that are not loans, there is no change in 

the Department’s policy that cash 

payments made under those 

arrangement count as non-Title IV, HEA 

revenue for 90/10 purposes. 

Changes: Section 668.28(a)(5)(i) is 

revised to provide that, to be included 

as an institutional loan for NPV 

purposes, a loan made to a student must 

be credited in full to the student’s 

account. 

Net Present Value (NPV) 

Comments: Several commenters 

objected to the provision in 

§ 668.28(b)(2) that an institution may 

not sell a loan it made to student until 

the loan is in repayment for at least two 

years. Although this provision would 

apply only if an institution chose to use 

the alternative approach to calculating 

the NPV of its loans (using 50 percent 

of loans made as the NPV), the 

commenters argued that holding the 

loans for at least two years is contrary 

to both statutory intent and institutional 

mission. The commenters reasoned that 

in response to the loss of availability of 

private student loans, the NPV approach 

provided by the HEOA is intended to 

give an immediate benefit to an 

institution that had to fill a funding gap 

itself by making loans to its students. To 

the second point, the commenters stated 

that the primary mission of an 

institution is to provide education and 

training, not to become a lender or 

remain in the lending business. 

Other commenters agreed with the 

rationale for the two-year ban on selling 

loans, but argued that the two-year 

period was too long and would unfairly 

impact an institution that provided loan 

funds to students who are not ‘‘high 

risk’’ and whose loans would perform 

within commercially acceptable norms. 

To mitigate this impact, the commenters 

recommended reducing the ban to one 

year. 

One commenter questioned whether 

the proposed regulations ensure that the 

calculation of the NPV for institutional 

loans takes into account the possibility 

that institutions do not intend to collect 

the loans they make to students. The 

commenter asserted that this practice 

calls into question an institution’s 

willingness or ability to accurately 

report estimates of annual payments 

due, as well as annual payments 

collected on these loans. The 

commenter also asked whether 

institutional loans that default are 

properly accounted for 90/10 purposes 

and if the Department has the authority 

to require, or would require, an 

institution to disclose information about 

its loan defaults. 

Discussion: As stated in the NPRM (74 

FR 42391), we proposed the alternative 

approach for calculating the NPV as an 

administrative convenience for an 

institution that either prefers a simpler 

method to determine the NPV or does 

not need the additional non-Federal 

revenues that might be counted if the 

NPV formula is used. It is solely up to 

the institution whether to use this 

alternative method or the actual NPV 

calculation. Each approach has costs 

and benefits that must be weighed by 

the institution. If the institution believes 

the alternative approach is too 

restrictive or somehow not in keeping 

with its mission, it should use the NPV 

calculation. 

With regard to the comments about an 

institution’s unwillingness to collect the 

loans it makes, we note that the 

institution might benefit initially from 

the NPV calculation, but because its 

collection rate would decrease 

significantly if it continues this practice, 

the institution would derive no benefit 

from future NPV calculations. We also 

note that the two-year ban on selling 

institutional loans, which applies to 

institutions that choose to use the 

alternate NPV approach, is necessary to 

ensure that the Department and other 

oversight entities have sufficient time to 

monitor whether the loans are subjected 

to routine collection efforts. 

Changes: None. 

Revenue From Loan Funds (§ 668.28) 

Comments: A few commenters noted 

that, although the proposed regulations 

in § 668.28(a)(6) provide that an 

institution may count as non-Title IV, 

HEA revenue the amount of a loan 

disbursement for a payment period that 

exceeds the amount a student would 

have received before the enactment of 

ECALSA, the regulations did not 

address how an institution should treat 

the excess loan funds when a student 

withdraws during a payment period. 

The commenters suggested that the 

excess loan funds should be returned in 

proportion to the overall loan 

disbursement for the payment period. 

Another commenter requested that 

when a student takes sequential courses 

within a non-term program, and is 

charged on a course-by-course basis, the 

excess loan funds should be attributed 

within a payment period on a course-bycourse basis. In this case, several 

courses make up the payment period. 

Discussion: When some of a student’s 

loan funds are classified as funds in 

excess of loan limits existing prior to 

ECASLA, those excess loan amounts are 

included as revenue from a source other 

than Title IV, HEA program funds under 

§ 668.28(a)(6) if those excess amounts 

pay for institutional charges remaining 

on the student’s account after Title IV, 

HEA funds are applied. The 

determination of which loan funds are 

classified as ‘‘post-ECASLA’’ funds, i.e., 

are funds in excess of loan limits 

existing prior to ECASLA, is generally 

made on a payment period basis. That 

is, if a student’s loan for the loan period 

contains a post-ECASLA amount and 

the post-ECASLA amount is 1⁄3 of the 

total loan amount, then each payment 

period’s loan disbursement is generally 

considered to consist of 1⁄3 postECASLA loan funds and 2⁄3 pre-ECASLA 

loan funds. However, if a student takes 

sequential courses within a non-term 

program where several courses make up 

a payment period, and the student is 

charged on a course-by-course basis, 

then the determination of which loan 

funds are classified as post-ECASLA 

funds may be determined on a courseby-course basis. Under 

§ 668.28(a)(7)(iv), loan funds that are 

returned pursuant to § 668.22 when a 

student withdraws from school are 

excluded from school revenues. The 

Secretary intends that, when a school 

determines the amount of loan funds 

that are excluded from revenues under 


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§ 668.28(a)(7)(iv), it considers the 

returned loan funds to be pre-ECASLA 

loan amounts and post-ECASLA loan 

amounts based on the ratio that existed 

for those categories of funds in the 

student’s loan for the loan period. 

Changes: Section 668.28(a)(7)(iv) is 

amended to provide that, in determining 

the amount of loan funds that are 

excluded from 90/10 revenues under 

§ 668.28(a)(7)(iv) when a student 

withdraws pursuant to § 668.22, and the 

institution returns loan funds from a 

loan disbursement considered to consist 

of pre-ECASLA loan funds and loan 

funds that were in excess of loan limits 

existing prior to ECASLA, the funds that 

the institution returns are pre-ECASLA 

loan amounts and post-ECASLA loan 

amounts based on the proportion of 

those loan amounts that existed in the 

loan disbursement used in the Return 

calculation. For example, a student’s 

loan disbursement for a payment period 

is $3,000, and $1,000 represents the 

funds in excess of loan limits existing 

prior to ECASLA. The proportional 

breakdown of the funds returned under 

the Return calculation is two-thirds preECALSA loan funds and one-third postECASLA loan funds. 

Application of Funds (§ 668.28) 

Comments: A few commenters noted 

that the proposed regulations did not 

address how military education benefits 

are treated for 90/10 purposes. The 

commenters argued that because 

students have earned these benefits 

through employment in difficult and 

often dangerous conditions, and are free 

to use the benefits at an eligible 

institution, the benefits should be 

treated for 90/10 purposes as earned 

employment benefits. However, a 

student receiving these benefits, which 

are essentially restricted to pay for 

tuition and fees, may also be fully 

eligible for Title IV, HEA aid. 

Consequently, the commenters asked 

the Department to revise the regulations 

to provide that military education 

benefits overcome the presumption that 

Title IV, HEA funds are used first to pay 

for tuition and fees. 

Discussion: Section 487(d)(1)(C) of the 

HEA contains the list of funds or 

sources of aid that overcome the 

presumption that Title IV, HEA funds 

are used first to pay for tuition and fees. 

The Department does not have the 

authority to expand that list. 

Changes: None. 

Notification to the Department 

(§ 668.28) 

Comments: Several commenters 

objected to the proposal in § 668.28(c)(3) 

that an institution must notify the 

Department that it failed the 90/10 

requirement no later than 45 days after 

the end of its fiscal year. Some of the 

commenters stated that there was no 

reason to shorten the current 90-day 

notification period. Other commenters 

argued that because the penalty for 

failing 90/10 (especially for a second 

consecutive year) is so severe, an 

institution should not be required to 

report unaudited data. According to the 

commenters, this may result because the 

small number of independent auditors 

who are experts in 90/10 calculations 

may be unavailable to the large 

percentage of for-profit institutions that 

have fiscal years ending December 31, 

because this is time that the auditors 

would normally be busy doing audit 

and tax work. 

Discussion: We are not persuaded that 

an institution that knows it is close to 

failing the 90/10 requirement could not 

plan for or take the steps necessary to 

engage an audit firm in time to meet the 

45-day reporting deadline. 

Changes: None. 

Institutional Plans for Improving the 

Academic Program (§ 668.43(a)) 

Comments: A few commenters stated 

that the requirement in the proposed 

regulations that an institution make 

readily available to enrolled and 

prospective students any plans by the 

institution for improving the academic 

program of the institution should 

include the statement in the preamble of 

the NPRM that an institution is allowed 

to determine what a ‘‘plan’’ is, including 

when a plan becomes a plan. 

Discussion: We agree that including 

the concept that an institution has the 

discretion to determine when a plan 

exists would clarify the intent of the 

regulations. 

Changes: Section 668.43(a)(5)(iv) is 

amended to clarify that an institution 

must make readily available to students 

any plans by the institution for 

improving the academic program of the 

institution, upon a determination by the 

institution that such a plan exists. 

Peer-to-Peer File Sharing and 

Copyrighted Material (§§ 668.14(b)(30) 

and 668.43(a)(10)) 

Comments: A few commenters 

supported the proposed changes 

asserting that they represented a fair 

interpretation of the intent of the statute 

and would aid institutions in both 

interpreting and properly following the 

new statute. One commenter asked 

whether the requirement that an 

institution offer, to the extent 

practicable, legal alternatives to illegal 

downloading or otherwise acquiring 

copyrighted material could be satisfied 

by the institution simply not blocking 

legal alternatives. One commenter 

expressed concern that the requirement 

that, as a part of an institution’s plans 

for combating the unauthorized 

distribution of copyrighted material, the 

institution must include the use of one 

or more technology-based deterrents as 

well as procedures for periodically 

reviewing the effectiveness of the plans 

would be unduly financially and 

administratively burdensome for 

institutions. 

Discussion: We do not believe that 

simply not blocking legal alternatives 

for downloading or otherwise acquiring 

copyrighted material qualifies as 

‘‘offering’’ legal alternatives. The 

requirements of § 668.14(b)(30)(ii)(A) 

and (B), that an institution must 

periodically review the legal 

alternatives and make available the 

results of the review to its students 

through a Web site or other means, 

support the notion that an institution’s 

actions in this area must be active, 

rather than passive. We note, however, 

that an institution must offer such legal 

alternatives ‘‘to the extent practicable.’’ 

Thus, how or whether the institution 

offers such alternatives is controlled by 

the extent to which it is practicable for 

the institution to do so. As stated in the 

preamble to the NPRM (74 FR 42393), 

the Department anticipates that 

individual institutions, national 

associations, and commercial entities 

will develop and maintain up-to-date 

lists of legal alternatives to illegal 

downloading that may be referenced for 

compliance with this provision. 

The requirement that, as a part of an 

institution’s plans for combating the 

unauthorized distribution of 

copyrighted material, the institution 

must include the use of one or more 

technology-based deterrents is statutory 

(see section 485(a)(1)(P) of the HEA) and 

we do not have the authority to remove 

this requirement. Moreover, we believe 

that the requirement that an institution’s 

plans include procedures for 

periodically reviewing the effectiveness 

of the institution’s plans for combating 

the unauthorized distribution of 

copyrighted material is essential for 

institutions to comply with the 

requirements in section 485(a)(1)(P) and 

487(a)(29) of the HEA. 

Changes: None. 

Consumer Information (§§ 668.41 and 

668.45) 

Comment: One commenter suggested 

that we remove the definition of 

‘‘Retention rate’’ from the regulations in 

§ 668.41. The commenter stated that it is 

unnecessary because the regulations 

already instruct institutions to disclose 


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retention rates as they are reported to 

the Integrated Postsecondary Education 

Data System (IPEDS) and IPEDS 

provides the definition on its Web site 

for institutions when they report that 

information. Of greater importance is 

the fact that, if the National Center for 

Education Statistics decides to modify 

the definition in the future, it would be 

better for them not to be constrained by 

having the current definition codified in 

the regulations. 

Discussion: We agree. 

Changes: We have removed the 

definition of ‘‘Retention rate’’ from the 

regulations. 

Comments: Although some 

commenters agreed with some or all of 

the proposed regulations addressing 

consumer information disclosures, a 

number of them objected to the 

proposed provision in § 668.41(d)(5)(iii) 

that would require an institution to 

disclose any placement rates it 

calculates, noting that, regarding 

placement, the statute only requires 

disclosure of information, not an actual 

rate. The statute addresses the 

requirement to report information about 

the ‘‘placement in employment of, and 

types of employment obtained by, 

graduates of the institution’s degree or 

certificate programs.’’ Because the 

statute specifically uses the term ‘‘rates’’ 

when it addresses graduation, 

completion, and retention, but not when 

it addresses placement, the commenters 

stated that the reporting of a ‘‘rate’’ for 

placement information exceeds the 

scope of the statute. 

For similar reasons, some of the 

commenters objected to the requirement 

to report the methodology that the 

institution uses in determining 

placement information, because a 

methodology would appear to be 

applicable only to an officially 

calculated rate. Further, some 

commenters noted that, although 

institutions may calculate various 

placement rates for their own purposes, 

those rates are not necessarily intended 

to be disclosed to the public. One 

commenter added that requiring 

institutions to report placement rate 

data that they voluntarily produce for 

their own purposes (such as for internal 

assessment of their programs) would be 

a disincentive to the institution to 

engage in that activity. 

This commenter did, however, 

support the concept of requiring an 

institution to make available to students 

any placement data that are used in 

advertising, marketing, or recruitment. 

Noting that some rates might be 

calculated on individual programs or 

other subcategories of the institution, 

several commenters suggested that the 

requirement to report placement rates 

that the institution voluntarily 

calculates should only be applicable to 

institution-wide placement rates. One 

commenter noted that reporting 

placement rates for individual programs 

is not required by the statute, cannot 

reasonably be implemented, and is 

unnecessary. The commenter 

specifically noted that current 

regulations addressing an institution’s 

requirement to have a program 

participation agreement require an 

institution that advertises job placement 

rates as a means of attracting students to 

provide information about its 

employment and graduation statistics. 

A number of commenters stated that 

the reporting of actual placement rates 

would be excessively burdensome for 

institutions and that the burden would 

outweigh the value of this reporting. A 

couple of commenters expressed 

concern that the regulations would force 

colleges to obtain information from 

graduates that the graduates are not 

obligated to provide, resulting in biased 

responses that would ‘‘taint’’ the 

information made available to students. 

On the other hand, a couple of other 

commenters stated that ‘‘when an 

institution has calculated placement 

rates, suggesting that it wants to know 

whether, when, and where its graduates 

are employed, then it is reasonable to 

think that the subject is of interest and 

value to students and prospective 

students as well, and should be shared 

with them.’’ Finally, although these 

same two commenters supported 

removing the words ‘‘upon request’’ 

from the several places in the 

regulations where institutions are 

required to make certain information 

available to students and prospective 

students, another commenter stated that 

the Department should not delete those 

words when describing the institution’s 

responsibility to make job placement 

information available to its consumers. 

The commenters who supported 

removing those words stated that 

removing them would make it clearer 

that the consumer information in 

question must be easily available. 

However, the commenter who opposed 

removing those words stated that, 

because the words were in the HEA, the 

Department did not have the authority 

to exclude them from the regulatory 

language implementing that part of the 

HEA. 

Discussion: The Department believes 

that, in addressing information 

dissemination activities, congressional 

intent was that students and prospective 

students be provided pertinent 

information related to an institution’s 

completion, graduation, transfer-out, 

and placement record. Only when 

sufficient information is available in 

these areas can students and prospective 

students make informed choices about 

the institution. The statute allows 

institutions to use placement 

information that the institution obtains 

from sources such as alumni and 

student satisfaction surveys, and it does 

not mandate that institutions calculate 

an actual rate for this purpose. However, 

when an institution has voluntarily 

calculated a placement rate, regardless 

of whether it is an institution-wide 

placement rate or a placement rate of 

only one or more programs or other 

subcategories of the institution, and 

regardless of whether the institution 

advertises its job placement rates, we 

believe that it is consistent with 

congressional intent to have the 

institution disclose this information to 

its consumers. Thus, although the 

regulations do not mandate that the 

institution calculate a placement rate, 

when the institution has voluntarily 

chosen to do so, the regulations require 

it to provide that information to its 

students and prospective students. To 

help ensure that the information is as 

meaningful as possible, the regulations 

require that the institution disclose not 

only the source of the information 

provided, but the time frames and 

methodology associated with the 

calculation or production of the 

information. 

Finally, regarding the exclusion of 

‘‘upon request’’ when describing the 

institution’s responsibility to make job 

placement information available to its 

students and prospective students, the 

Department notes that institutions 

typically compile and make the 

information available on their Web sites, 

but possibly in paper form as well. 

Consequently, we view the inclusion of 

the phrase ‘‘upon request’’ to mean that 

this information is readily available to 

students who wish to see it. As a matter 

of course, students coming to an 

institution’s Web site to learn about the 

institution should be able to find this 

information, and students inquiring 

directly may be referred to the Web site 

or provided with the information on 

paper. 

Changes: None. 

Comment: With regard to the 

disaggregation of completion or 

graduation rates by receipt or non 

receipt of certain types of aid, one 

commenter expressed concern that the 

wording in § 668.45(a)(6)(ii), which 

states that ‘‘students shall be considered 

to have received the aid in question 

only if they received such aid in the 

period specified in paragraph (a)(3) of 

this section,’’ would exclude students 


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who received aid for the first term (the 

period in question), but who had the 

receipt of that aid delayed beyond the 

period in question due to an 

unanticipated deferral of payment, such 

as for verification. The commenter 

stated that receipt of aid in this 

circumstance would have the same 

effect on access and enrollment as if the 

aid were paid in the first term. The 

commenter expressed hope that the 

Department’s intent was not to have the 

students listed as not receiving the aid 

in question. 

Discussion: We agree that students 

who receive aid in a second term that 

was intended for the first term should 

be listed in the same category as 

students who actually received their aid 

in the first term. 

Changes: We have changed the word 

‘‘in’’ to ‘‘for’’ in § 668.45(a)(6)(ii). 

Comment: Several commenters 

expressed concern that recordkeeping 

and reporting requirements in § 668.45 

could serve as a disincentive to 

institutions to offer a comprehensive 

transition and postsecondary education 

program (as addressed in subpart O of 

the regulations, Financial Assistance for 

Students with Intellectual Disabilities). 

The commenters questioned whether 

these students would negatively affect 

an institution’s completion or 

graduation rate because students with 

intellectual disabilities do not typically 

matriculate and graduate with a regular 

diploma. 

Discussion: Section 668.45 requires an 

institution to prepare a completion or 

graduation rate (and sometimes a 

transfer out rate) for its certificate- or 

degree-seeking, first-time, full-time 

undergraduate students. If an institution 

has a comprehensive transition and 

postsecondary education program, some 

of its students with intellectual 

disabilities who are enrolled in that 

program may factor into the institution’s 

completion and graduation rate. It is 

unlikely that they would be part of an 

institution’s transfer out rate. A 

comprehensive transition and 

postsecondary education program may 

be a degree or certificate program, or it 

may be a non-degree or non-certificate 

program. Certificate or degree-seeking, 

first-time, full-time undergraduate 

students with intellectual disabilities 

who are enrolled in a comprehensive 

transition and postsecondary education 

program will be part of an institution’s 

completion and graduation rate 

calculations. As with other students, if 

they complete or graduate from their 

degree or certificate program within the 

time frames listed in § 668.45(b), they 

will be listed. The Department does not 

believe that first-time, full-time, 

undergraduate students with 

intellectual disabilities who are enrolled 

in a comprehensive transition and 

postsecondary education program 

designed to lead to a degree or 

certificate will necessarily have 

completion or graduation rates 

significantly different from first-time, 

full-time, undergraduate students 

without intellectual disabilities. 

Students with intellectual disabilities 

who are enrolled in a comprehensive 

transition and postsecondary education 

program that does not lead to a degree 

or certificate will not be a factor in an 

institution’s graduation and completion 

rate. 

Changes: None. 

Comments: Two commenters noted 

that removing the reference to paragraph 

(d) in § 668.48(b) leaves out the 

exclusion of students who have left 

school to serve in the Armed Forces, to 

serve on official church missions, or to 

serve with a foreign aid service of the 

Federal Government from the 

completion or graduation, or transferout rate information required by 

§ 668.48. 

Discussion: The commenters are 

correct. The proposal to remove the 

reference to paragraph (d) and replace it 

with paragraph (e) was a mistake. 

Changes: None. 

Campus Safety Provisions 

Reporting and Disclosure of Information 

(§ 668.41(a)) 

Comment: One commenter requested 

clarification of what would be 

considered an ‘‘on-campus student 

housing facility.’’ Specifically, the 

commenter questioned how this 

definition should be applied in cases in 

which there are public-private 

partnerships or third parties who may 

own or control property on areas 

contiguous to the campus or on 

university-owned property. 

Discussion: The Department 

recognizes that there are a myriad of 

possible arrangements that an 

institution may have for housing 

facilities for students. Regarding 

whether a particular student housing 

facility is an ‘‘on-campus’’ facility, we 

refer to the current definition of the 

term ‘‘campus’’ in § 668.46(a). To 

clarify, any student housing facility that 

is owned or controlled by the 

institution, or is located on property 

that is owned or controlled by the 

institution, and is within the reasonably 

contiguous geographic area that makes 

up the campus is considered an oncampus student housing facility. 

Changes: None. 

Missing Student Notification Procedures 

(§ 668.46(h)) 

Comment: A number of commenters 

requested clarification of how the 

proposed requirement in § 668.46(h) 

relates to requirements under the 

Family Educational Rights and Privacy 

Act (FERPA). Under this section, 

institutions must provide students 

living in an on-campus student housing 

facility an option to register a 

confidential contact person to be 

notified in the case that the student is 

determined missing. 

Discussion: Although missing student 

contact information would be 

considered part of a student’s education 

records under FERPA, section 485(j) of 

the HEA, as amended by section 488(g) 

of the HEOA, requires that students be 

provided the option to register 

‘‘confidential’’ contact information. This 

indicates that a student’s contact 

information should receive greater 

privacy protections than FERPA 

provides. Under section 485(j) of the 

HEA, only authorized campus officials 

and law enforcement officers in 

furtherance of a missing person 

investigation may have access to this 

confidential contact information. We 

view a student’s identification of a 

contact person pursuant to section 

485(j) of the HEA and § 668.46(h) as 

providing permission for law 

enforcement personnel to contact the 

identified individual under the 

circumstances identified in these 

statutory and regulatory provisions. 

Changes: None. 

Comment: Some commenters 

expressed concern that the proposed 

notification procedures in § 668.46(h)(2) 

may lead to unnecessary alarm on the 

part of parents, guardians, and 

emergency contact persons, as well as a 

needless burden on campus and local 

law enforcement agencies. Specifically, 

they requested clarification that the 

notification procedures would only take 

effect if, after a brief investigation, the 

missing student report is found to be 

valid. In addition, several commenters 

requested clarification about the 24 hour 

time period requirements associated 

with the notification procedures, 

suggesting that an institution’s policy 

statement must explicitly state that the 

institution must make the notification 

within 24 hours after an official 

determination has been made that the 

student has been missing for 24 hours. 

Discussion: The proposed regulations 

in § 668.46(h)(2) specify that an 

institution’s notification procedures 

must go into effect within 24 hours after 

a student has been officially determined 

to have been missing for 24 hours by the 


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campus security department or local 

law enforcement agency, as applicable. 

This does not preclude an institution 

from either making a determination that 

a student is missing before the student 

has been missing for a full 24 hours or 

initiating notification procedures as 

soon as it determines that the student is 

missing. A brief investigation as 

suggested by the commenter would 

presumably be included in this official 

determination, e.g., authorities could 

check sources such as Facebook in 

trying to determine whether the student 

is missing. We agree, nevertheless, that 

the regulations could be clearer in 

delineating the 24 hour time periods. 

Changes: Section 668.46(h) is revised 

to clarify the time frame within which 

notification must occur. 

Comment: A commenter stated that 

the regulations in § 668.46 were unclear 

and suggested a new structure. 

Discussion: We reviewed the 

commenter’s suggested language, but we 

continue to believe the current structure 

is sufficiently clear. This language 

reflects the tentative agreement reached 

by the Team V committee during 

negotiated rulemaking, and the 

Department wishes to preserve this 

agreement. 

Changes: None. 

Annual Fire Safety Report—Definitions 

of Terms (§ 668.49(a)) 

Comment: One commenter suggested 

that the definition of value of property 

damage should be revised to include 

only the damage to property, 

furnishings, and equipment that is 

owned, leased, or otherwise controlled 

by the institution. The commenter 

argued that it could be burdensome for 

institutions to determine the value of 

property and contents that are owned by 

third parties and that this information 

could be deemed private by the other 

party. In addition, the commenter 

suggested that institutions should have 

the option to provide explanatory text 

and clarifying information for estimates 

of property damage. The concern was 

that a high dollar value may create false 

concern as to the safety on campus, 

when in reality, a high value could be 

from damage to a single piece of 

expensive equipment. 

Discussion: The definition of the 

value of property damage applies to an 

on-campus student housing facility and 

includes the value of property and the 

contents within. The Department 

recognizes that many of the contents on 

a property may be owned by third 

parties. However, because the statute 

requires that information be provided 

about damage caused by fires in oncampus student housing facilities, this 

estimate should include the value of 

property that is not owned or controlled 

by the institution. Although an 

institution may not be able to determine 

the exact value of the contents, it must 

give the most accurate estimate possible 

in order to be in compliance with the 

regulation. With regard to explanatory 

text, institutions have the flexibility to 

include additional information in the 

annual fire safety report. In reporting 

statistics to the Department, the Webbased collection tool will include space 

for institutions to include explanatory 

text for each item that will be viewable 

on the public Web site. 

Changes: None. 

Comment: One commenter stated that 

the definition of fire in § 668.49(a) was 

ambiguous and needed to be clarified. 

Specifically, the commenter suggested 

that phrases such as ‘‘open flame or 

other burning in a place not intended to 

contain the burning or in an 

uncontrolled manner’’ and ‘‘place’’ 

could be interpreted differently by 

institutions and, therefore, could 

undermine the consistency of the 

definition of ‘‘fire’’ for statistical and 

comparative purposes. Further, the 

commenter suggested an alternate 

definition drawn from insurance law 

that would include the concept of a 

‘‘hostile fire,’’ or one that includes any 

combustion that cannot be controlled, 

escapes from where it was initially set 

and confined, and that was not intended 

to exist. The commenter also questioned 

the feasibility of gathering statistics on 

each instance of a fire that does not 

result in injury, death, or property 

damage, suggesting that reports of 

insignificant fires will obscure attention 

to serious fire problems or trends. 

Discussion: Section 485(i)(1)(A) of the 

HEA requires that institutions collect 

and report statistics on the number of 

fires in each on-campus student housing 

facility, and section 485(i)(3) of the HEA 

further requires that institutions 

maintain a log of all fires that occur in 

any on-campus student housing facility. 

The Department and non-Federal 

negotiators worked diligently to define 

the term fire, understanding that it is 

difficult to devise a definition that will 

cover all of the fires that we intend to 

be included yet still exclude the ones 

that we do not. The negotiators reached 

a tentative agreement on the definition 

of fire, and the Department wishes to 

preserve this language. We continue to 

believe that the definition set forth in 

the proposed regulations can reasonably 

be interpreted and applied by 

institutions. 

In addition, under the HEA all fires 

will be included in the institution’s 

statistics and in the fire log. Therefore, 

the definition of fire arguably may not 

be limited to only fires that result in 

injury, death, or property damage. 

Further, as stated in the preamble to the 

NPRM, an institution’s policies 

regarding fire safety do not affect the 

classification of whether a fire meets the 

definition of fire. As an example, one 

commenter suggested that a candle wick 

might be a ‘‘place’’ that is intended to 

contain burning, but that student 

residence hall policies might prohibit 

candles, rendering the candle wick no 

longer a ‘‘place’’ intended to contain a 

flame because the candle should not be 

there at all. However, a candle wick is 

still a place intended to contain 

burning, regardless of whether candles 

are prohibited under an institution’s 

policies. The Department anticipates 

including additional examples in a 

revised version of the Handbook for 

Campus Crime Reporting to provide 

guidance to institutions in complying 

with these regulations. 

Changes: None. 

Annual Fire Safety Report—Statistics 

(§ 668.49(b) and (c)) 

Comment: One commenter suggested 

that an institution should not be 

responsible for tracking an individual 

with a fire-related injury who has 

separated from the university for the 

purpose of potentially including that 

individual in the institution’s statistics 

on fire-related deaths. If that individual 

dies within one year of sustaining 

injuries as a result of a fire, then the 

institution may not know whether that 

individual died as a result of those 

injuries. 

Discussion: The regulations do not 

require an institution to track an 

individual that separates from, and is no 

longer in contact with, the institution. 

However, the institution is expected to 

make a reasonable effort to ascertain 

whether an individual’s death is 

considered a fire-related death, as 

defined in § 668.49(a). For example, if 

an individual with fire-related injuries 

is hospitalized a few miles from the 

institution, the institution may 

reasonably be expected to track this 

person for potential inclusion in the 

institution’s statistics. By contrast, if an 

individual separates from the institution 

and travels to another country, the 

institution may not be expected to track 

them for inclusion in the institution’s 

statistics. 

Changes: None. 

Annual Fire Safety Report—Description 

of Policies (§ 668.49(b)) 

Comment: One commenter suggested 

that we revise the language related to 

the reporting of fire statistics under 


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proposed § 668.49 to specify that these 

statistics include fires that are reported 

to a ‘‘campus fire authority.’’ 

Discussion: Institutions are expected 

to collect information about, and report 

on, all fires regardless of whether they 

were reported to a campus fire 

authority. Fires may be reported to a 

variety of authorities at an institution 

other than a campus fire authority (e.g., 

to a residence life officer). The intent of 

the regulations is to include these fires 

in an institution’s statistics and fire log. 

Changes: None. 

Comment: Two commenters suggested 

that the Department require that 

institutions have fire doors and other 

doors in the path of exit from a fire 

inspected at least annually and disclose 

in their annual fire safety report how 

often the doors are inspected. The 

commenters noted that proper 

maintenance and inspection of every 

fire safety system element is critical to 

ensure that these elements can function 

in the case of a fire. 

Discussion: We define a fire safety 

system in § 668.49(a) as ‘‘any 

mechanism or system related to the 

detection of a fire, the warning resulting 

from a fire, or the control of a fire,’’ 

listing elements including, among 

others, sprinkler systems, fire detection 

devices, stand-alone smoke alarms, and 

fire doors and walls as examples of what 

might be included in a fire safety 

system. The commenter correctly states 

that maintenance and inspection of a 

fire safety system can help ensure that 

the elements are properly functioning. 

Institutions are required to describe the 

fire safety system in each on-campus 

student housing facility, and an 

institution may provide information 

about how often the elements of each 

fire safety system are inspected or 

maintained in this description. The 

Department expects that an institution 

will adequately maintain the elements 

of its fire safety systems. However, we 

do not intend to specify a maintenance 

or inspection schedule for each of these 

elements. 

Changes: None. 

Annual Fire Safety Report—General 

(§ 668.49) 

Comment: One commenter suggested 

a number of minor changes to a variety 

of provisions, including: 

• Replacing the phrase ‘‘may 

include’’ in the definition of a firerelated injury in § 668.49(a) with the 

word ‘‘includes’’; 

• Replacing the words ‘‘faculty, staff’’ 

in the definition of a fire-related injury 

in § 668.49(a) and in the requirement 

that an institution include policies 

regarding fire safety education and 

training programs in its annual fire 

safety report in § 668.49(b)(6) with the 

word ‘‘employees’’; 

• Replacing the words ‘‘resulting 

from’’ in the definition of a fire-safety 

system in § 668.49(a) with ‘‘of’’; 

• Replacing the phrase ‘‘smoke, 

water, and overhaul’’ in the definition of 

value of property damage in § 668.49(a) 

with ‘‘smoke and water’’; and 

• Revising the § 668.49(c)(1)(ii) to 

read ‘‘The number of persons who 

received fire-related injuries that 

resulted in treatment at a medical 

facility, including at an on-campus 

health center.’’ 

Discussion: We agree to make some of 

these changes. In particular, we agree 

with the commenter that institutions 

should include the number of persons 

who received fire-related injuries, as 

opposed to the actual number of 

injuries, as a single person may have 

more than one injury. We also agree that 

the term ‘‘employees’’ is more precise 

than the words ‘‘faculty, staff’’ and have 

revised the regulations accordingly. 

Changes: We have revised the 

language in § 668.49(c)(1)(ii) to clarify 

that the number of injuries refers to the 

number of people with fire-related 

injuries. We have also replaced the 

words ‘‘faculty, staff’’ with the word 

‘‘employees’’ in both § 668.49(a) and 

§ 668.49(b)(6). 

Comment: One commenter suggested 

that we revise § 668.43 to include two 

additional disclosures specified in the 

HEOA that require institutions to 

disclose their policies on vaccination, 

and information on diversity of the 

student body. 

Discussion: The Department is not 

addressing all of the self-implementing 

provisions of the HEOA in these 

regulations. We intend to publish 

separate regulations covering these new 

disclosures. 

Changes: None. 

Subpart O—Financial Assistance for 

Students With Intellectual Disabilities 

Scope and Purpose (§ 668.230) 

Comment: One commenter expressed 

concern that the limit on the amount of 

time for which a student can receive a 

Pell Grant would adversely affect the 

completion time of a student with an 

intellectual disability because the 

student may need to spend additional 

time in remedial or developmental 

classes. The commenter suggested that 

the Department waive the cap on the 

number of Federal Pell Grant awards a 

student with an intellectual disability 

may receive. 

Discussion: The Federal Pell Grant 

statutory cap is 18 semesters or 9 years. 

Because students with intellectual 

disabilities are not yet enrolled in 

comprehensive transition and 

postsecondary programs approved by 

the Department under these regulations, 

we do not have any data that suggests 

that these students will need longer to 

complete their comprehensive transition 

and postsecondary programs. For this 

reason, we believe it is inappropriate to 

waive the Federal Pell Grant cap for 

these students as part of these 

regulations. 

Changes: None. 

Comment: Two commenters requested 

that proposed § 668.230 be revised to 

require the Secretary to waive any rules 

necessary to ensure that students 

enrolled in eligible comprehensive 

transition and postsecondary programs 

remain eligible for Federal Pell, FSEOG, 

and FWS program funds. 

Discussion: Section 484(s)(3) of the 

HEA authorizes the Secretary to waive 

any statutory provision applicable to the 

Federal Pell Grant, FSEOG, and FWS 

programs—other than the need analysis 

provisions in part F of the HEA—as well 

as any institutional eligibility provisions 

that the Secretary determines necessary 

to ensure that programs enrolling 

students with intellectual disabilities 

otherwise determined to be eligible may 

receive financial assistance. While this 

section of the HEA authorizes the 

Secretary to grant the waivers of the sort 

described by the commenters, it does 

not require the Secretary to do so. The 

Secretary generally does not regulate the 

Department’s own procedures. 

Changes: None. 

Definitions (§ 668.231) 

Comment: A few commenters 

expressed concern that the proposed 

regulations do not sufficiently convey 

the importance of employment as a 

desired outcome for students with 

intellectual disabilities who enroll in 

eligible comprehensive transition and 

postsecondary programs. 

Discussion: We agree with the 

commenters that gainful employment is 

an important outcome for students with 

intellectual disabilities participating in 

comprehensive transition and 

postsecondary programs. In fact, the 

Department has a long history of 

providing national leadership for, and 

administration of, programs that 

develop and implement comprehensive 

and coordinated programs of vocational 

rehabilitation, supported employment 

and independent living for individuals 

with disabilities, through services, 

training and economic opportunities, in 

order to maximize their employability, 

independence and integration into the 

workplace and the community. 


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We believe that the regulations 

sufficiently ensure that the 

comprehensive transition and 

postsecondary programs approved by 

the Department will focus on ensuring 

that enrolled students will be prepared 

for gainful employment. Specifically, in 

the definition of the term 

comprehensive transition and 

postsecondary program in § 668.231, 

paragraph (a)(3) provides that the 

program is one that is designed to 

support students with intellectual 

disabilities who are seeking to continue 

academic, career and technical, and 

independent living instruction at an 

institution of higher education in order 

to prepare for gainful employment. 

Under § 668.232(a), an institution 

applying to offer a comprehensive 

transition and postsecondary program as 

an eligible program under title IV of the 

HEA must provide to the Secretary a 

detailed description of that program, 

including a description that addresses 

all of the components of the program, as 

defined in § 668.231. Because 

§ 668.231(a)(3) specifically references 

that a comprehensive transition and 

postsecondary program is one that is 

designed to prepare enrolled students 

for gainful employment, the detailed 

description required under § 668.232(a) 

must include a description of how the 

program meets this definitional 

requirement. We, therefore, believe that 

the regulations sufficiently ensure that 

any comprehensive transition and 

postsecondary program will focus on 

the outcome of gainful employment for 

students participating in these 

programs. 

Changes: None. 

Comment: Two commenters requested 

clarification of how half-time 

participation for students with 

intellectual disabilities should be 

determined, specifically, whether ‘‘halftime’’ is based on real time or credit 

hours, and whether it is calculated per 

semester or across the length of the 

program. In a related issue, commenters 

also suggested that the proposed 

regulations place too much emphasis on 

the academic portions of the program, 

arguing that the half-time integration 

criterion should not be linked 

exclusively to coursework and 

internships but should be expanded to 

include outside activities. 

Discussion: Section 668.231(a)(5) 

specifies that a comprehensive 

transition and postsecondary program is 

a program that requires students with 

intellectual disabilities to have at least 

one-half of their participation in the 

program, as determined by the 

institution, focus on academic 

components through one or more of a 

variety of activities that integrate 

students with intellectual disabilities 

into academic contexts with students 

without disabilities. Institutions have a 

fair degree of flexibility in determining 

the meaning of ‘‘half-time participation’’ 

in designing a comprehensive transition 

and postsecondary program: It may be 

reasonably based on real hours, credit 

hours, or a combination of the two, and 

it may be calculated across the span of 

the program or by term, as long as an 

institution clearly explains in its 

application to add an eligible program 

how this will be determined. 

With regard to the comments stating 

that the proposed regulations place too 

much emphasis on the academic 

portions of the program, we disagree. 

Section 668.231(a)(5) only requires that 

the program require enrolled students to 

have at least one half of their 

participation in the program focus on 

academic components. We fully expect 

that the remaining portion of the 

program will consist of other activities 

that include having enrolled students 

with intellectual disabilities participate 

with students without disabilities in 

such non-academic settings as clubs, 

organizations, service projects, or other 

university or community life activities. 

Changes: None. 

Comment: A few commenters 

expressed concern that the proposed 

definition of a student with an 

intellectual disability in § 668.231(b) 

does not exist in the Individuals with 

Disabilities Education Act (IDEA). 

Specifically, several commenters asked 

which students would be considered 

students with intellectual disabilities 

under the HEA. 

Discussion: Under § 668.231(b), a 

student with an intellectual disability is 

defined as a student with mental 

retardation or a cognitive impairment 

characterized by significant limitations 

in intellectual and cognitive functioning 

and adaptive behavior, as expressed in 

conceptual, social, and practical 

adaptive skills, and who is currently, or 

was formerly eligible for special 

education or related services under the 

IDEA. The Department recognizes that 

disabilities other than mental 

retardation, such as certain forms of 

autism and traumatic brain injury, may 

be considered intellectual disabilities. 

Under § 668.233(c), a student with an 

intellectual disability is eligible to 

receive Federal Pell, FSEOG, and FWS 

program assistance under subpart O of 

part 668 (Financial Assistance for 

Students with Intellectual Disabilities) if 

the institution that offers the eligible 

comprehensive transition and 

postsecondary program obtains a record 

from a local educational agency (LEA) 

that the student is or was eligible for 

special education and related services 

under the IDEA. This section clarifies 

that if that record does not specifically 

identify the student as having an 

intellectual disability, the institution 

must review all documentation 

obtained, such as a documented 

comprehensive and individualized 

psycho-educational evaluation and 

diagnosis of an intellectual disability by 

a psychologist or other qualified 

professional; or a record of the disability 

from an LEA or State educational 

agency (SEA), or government agency, 

such as the Social Security 

Administration or a vocational 

rehabilitation agency, that identifies the 

intellectual disability. Ultimately, the 

institution determines whether a 

student meets the definition of a student 

with an intellectual disability for the 

purposes of this subpart. 

Changes: None. 

Comment: Many commenters 

disagreed with the requirement that a 

student with an intellectual disability 

must have gone through the formal 

IDEA eligibility process to be eligible for 

Title IV, HEA program assistance. They 

argued that the Conference report 

indicates that Congress intended to 

include students who were homeschooled or went to a private school in 

the definition of a student with an 

intellectual disability. The commenters 

further suggested that if the Department 

maintains its position that only students 

who have gone through the formal IDEA 

eligibility process are eligible for Title 

IV, HEA program assistance, then the 

Department should issue guidance and 

alerts to States, LEAs, students, parents, 

parent training centers, and advocacy 

organizations, reminding them that the 

IDEA’s Child Find and Free Appropriate 

Public Education (FAPE) in the Least 

Restrictive Environment requirements 

apply to all individuals who are still at 

an age at which they could receive 

special education services in their State. 

Discussion: As discussed in the 

preamble to the NPRM, we interpret the 

statute as providing that a student who 

has not gone through the formal IDEA 

eligibility process does not meet the 

definition of a student with an 

intellectual disability. Specifically, 

section 760(2) states that a student with 

an intellectual disability means a 

student who ‘‘is currently, or was 

formerly, eligible for a FAPE under the 

IDEA.’’ While the Department does not 

wish to exclude students who have not 

gone through this process, we do not 

believe the statutory language permits 

the Department to make these students 

eligible. We encourage students to 

obtain an IDEA eligibility determination 


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while they are still age-eligible for IDEA 

services. The Department will continue 

to remind States and LEAs of their 

responsibilities under the IDEA, 

including under the child find provision 

in section 612(a)(3), that they locate, 

identify, and evaluate all children with 

disabilities residing in the State, 

including those who are in private 

schools or are home-schooled. 

Changes: None. 

Program Eligibility (§ 668.232) 

Comment: One commenter suggested 

that, rather than requiring an institution 

to apply to have a comprehensive 

transition and postsecondary program 

for students with intellectual disabilities 

approved by the Department for Title 

IV, HEA funding, the Department 

simply require the institution to provide 

assurances that it offers a program that 

meets the criteria of a comprehensive 

transition and postsecondary program 

for students with intellectual 

disabilities. The commenter argued that 

this would provide a more streamlined 

application process. The commenter 

also noted that the HEOA authorizes a 

new model demonstration program and 

a coordinating center that will enable 

the Department to gather information on 

best practices and to work to develop 

model accreditation standards for these 

programs. 

Discussion: The process for adding a 

comprehensive transition and 

postsecondary program to the list of 

eligible programs at an institution 

should not pose a large burden on 

institutions, because it will be part of 

the same process an institution now 

uses to notify the Department of any 

new program it seeks to include as an 

eligible Title IV, HEA program. As far as 

the model demonstration program and 

coordination center, the Department has 

a current National Institute of Disability 

and Rehabilitation Research center 

evaluating promising practices in this 

area. 

Changes: None. 

Comment: One commenter requested 

that the Department clarify whether 

only currently existing comprehensive 

transition and postsecondary programs 

can be eligible for Department approval 

under § 668.232. The commenter asked 

if any comprehensive transition and 

postsecondary program offered by an 

institution is an eligible comprehensive 

transition and postsecondary program. 

Discussion: An institution may submit 

to the Secretary for approval under 

§ 668.232 a comprehensive transition 

and postsecondary program that it 

currently offers or a program that it is 

ready to implement. The Secretary will 

consider for approval any 

comprehensive transition and 

postsecondary program that meets the 

definitional requirements in 

§ 668.231(a) for which an institution 

submits an application in accordance 

with § 668.232. There are currently no 

comprehensive transition and 

postsecondary programs approved by 

the Department. 

Changes: None. 

Comment: Commenters suggested that 

we add a new provision in § 668.232 to 

require an institution to include in its 

application for approval of a 

comprehensive transition and 

postsecondary program, a description of 

how students with intellectual 

disabilities are socially and 

academically integrated into the campus 

community to the maximum extent 

possible. 

Discussion: We do not believe that the 

suggested language is necessary. Section 

668.232(a) requires that institutions 

provide a detailed description of the 

comprehensive transition and 

postsecondary program that addresses 

all of the components of the program, as 

defined in § 668.231, in their 

application for approval by the 

Department. One of those elements, in 

§ 668.231(a)(6), specifies that a 

comprehensive transition and 

postsecondary program must provide 

students with intellectual disabilities 

opportunities to participate in 

coursework and other activities with 

students without disabilities. To comply 

with these regulations, an institution 

applying to add an eligible 

comprehensive transition and 

postsecondary program must address 

this element by explaining how its 

program will ensure that students with 

intellectual disabilities are integrated 

socially and academically with students 

without disabilities. 

Changes: None. 

Comment: One commenter asserted 

that the concept of a program is 

different in special education than it is 

in higher education in that, in the 

special education context, a program is 

typically an individualized set of 

services and supports designed for a 

single student. This commenter stated 

that a set of services and supports 

designed for a single individual student 

to participate in regular college courses, 

internships, and the like should 

constitute a comprehensive transition 

and postsecondary program. The 

commenter questioned whether the 

Department would approve such a 

comprehensive transition and 

postsecondary program for a single 

student, and, if so, whether it would be 

necessary for each individualized set of 

services and supports to be approved by 

the Department as a separate program. 

The commenter believed that, as long as 

a basic structure of support is in place 

for these programs, the services may be 

individualized to meet the needs of a 

single student or a group of students 

and that the institution should only be 

required to apply once for the ‘‘basic’’ 

program structure, and then be able to 

offer individual variations of the 

program as needed to individuals 

without having to reapply for program 

eligibility for each version of the 

program. 

Discussion: In general, an institution 

must demonstrate in its application that 

its comprehensive transition and 

postsecondary program satisfies the 

definitional criteria in § 668.231(a). An 

institution may have one, or more than 

one, comprehensive transition and 

postsecondary program. A program may 

be for only one student or for a group 

of students, but each program must be 

approved by the Department. To be 

clear, the Department will not approve 

a generalized structure that can later be 

modified by the institution to be a 

different program for specific students. 

That said, once a program is approved, 

it can be modified slightly for different 

students. For example, a program 

approved under § 668.231 may require a 

specific number and type of courses, 

along with other program requirements, 

but that does not mean that each student 

in that program will take exactly the 

same courses. Much like the variation in 

any student’s curriculum that results 

from individual choices in elective 

coursework and required academic 

areas within a program, individual 

students enrolled in an approved 

comprehensive transition and 

postsecondary program may end up 

taking some different courses. All such 

courses must be part of the same 

approved program or part of a separately 

approved program. 

Changes: None. 

Comment: One commenter suggested 

that if a student with an intellectual 

disability is dually enrolled in an LEA 

and in a comprehensive transition and 

postsecondary program, then the State 

Accrediting Agency, SEA, and other 

stakeholders should have input into the 

accrediting process of the 

comprehensive transition and 

postsecondary program. 

Discussion: The Department is not 

requiring programmatic accreditation as 

a condition for approving a 

comprehensive transition and 

postsecondary program. Under 

§ 668.232(e), the institution is required 

to inform its institutional accrediting 

agency of its comprehensive transition 

and postsecondary program if the 


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institution applies to have that program 

approved by the Department as an 

eligible program for Title IV, HEA 

program purposes. The accrediting 

agency determines what it does with 

that information. 

Changes: None. 

Comment: One commenter asked how 

accreditation status was determined 

when an institution and a non-profit 

agency share responsibility for 

providing and operating a 

comprehensive transition and 

postsecondary program through a formal 

memorandum of agreement. The 

commenter suggested that the 

accreditation status of the non-profit 

agency should be considered in the 

accreditation of the program. Further, 

under a situation such as this, the 

commenter requested clarification as to 

whether Title IV, HEA program 

assistance could be applied toward the 

costs for services and fees provided by 

both the institution and the non-profit 

agency. 

Discussion: Only an institution 

participating in the Title IV, HEA 

programs may offer an eligible 

comprehensive transition and 

postsecondary program, as that term is 

defined in § 668.231(a). For this reason, 

the Department will take into account 

only the institution’s accreditation 

status in approving a comprehensive 

transition and postsecondary program. 

The accreditation of the non-profit 

agency would not have an impact on the 

eligibility of the program. Under § 668.5, 

an eligible institution may contract out 

a portion of the eligible program 

through a written arrangement with 

another eligible institution, an ineligible 

institution, or an ineligible organization 

to provide the educational program. 

Section 668.5(c)(3) of the regulations 

specifies that— 

(1) The ineligible institution or 

organization may not provide more than 

25 percent of the educational program; 

or 

(2) The ineligible institution or 

organization may provide more than 25 

percent but not more than 50 percent of 

the educational program, as long as— 

(a) The eligible institution and 

ineligible institution or organization are 

not owned, or controlled by the same 

individual, partnership, or corporation; 

and 

(b) The eligible institution’s 

accrediting agency, or if the institution 

is a public postsecondary vocational 

educational institution, the State agency 

listed in the Federal Register in 

accordance with 34 CFR part 603, has 

specifically determined that the 

institution’s arrangement meets the 

agency’s standards for the contracting 

out of educational services. 

In terms of funding, the amount of 

Title IV, HEA program assistance that a 

student may receive for enrollment in a 

comprehensive transition and 

postsecondary program is based on the 

student’s need, which is defined in 

section 471 of the HEA as the cost of 

attendance minus the student’s 

expected family contribution minus any 

estimated financial assistance received 

by the student. Need-based aid that a 

student receives may be used toward 

any costs in the student’s cost of 

attendance, including those incurred 

through parts of the program that have 

been contracted out to a non-profit 

agency or other institution or 

organization through a written 

arrangement with the eligible institution 

that offers the program. 

Changes: None. 

Student Eligibility (§ 668.233) 

Comment: One commenter questioned 

whether a student with an intellectual 

disability would be disqualified from 

receiving Title IV, HEA program 

assistance if he or she has a legal 

guardian. 

Discussion: Having a legal guardian 

would not preclude a student with an 

intellectual disability from receiving 

Federal student aid funds. It may, 

however, affect the student’s 

dependency status, which is taken into 

account in determining a student’s 

financial need. Therefore, having a legal 

guardian may affect the amount of 

financial aid funds for which the 

student may be eligible. 

Changes: None. 

Comment: Several commenters asked 

for clarification on whether a high 

school student who receives special 

education and related services can also 

be enrolled in a comprehensive 

transition and postsecondary program. 

Discussion: It is the Department’s 

longstanding position that a student 

with a disability may be dually enrolled 

in secondary school and a 

postsecondary institution, although 

such dual enrollment precludes the 

student from being eligible for Title IV, 

HEA aid. 

The provisions in section 612(a)(2) of 

the IDEA and 34 CFR 300.110 require 

States to ensure that public agencies 

take steps to ensure that children with 

disabilities have access to the same 

program options that are available to 

nondisabled children in the area served 

by the agency. This would apply to dual 

enrollment programs in postsecondary 

or community-based settings. However, 

we do not believe that the IDEA, or its 

implementing regulations, requires 

public agencies to provide dual 

enrollment programs in postsecondary 

or community-based settings for 

students with disabilities, if such 

programs are not available to secondary 

school students without disabilities. In 

a State that offers dual enrollment 

programs to secondary school students, 

a high school student with an 

intellectual disability, as defined under 

§ 668.231(b), who is receiving special 

education and related services may be 

dually enrolled in an eligible 

comprehensive transition and 

postsecondary program under § 668.232. 

Changes: None. 

Comment: Several commenters 

expressed concern regarding the 

provision of special education and 

related services to a student with an 

intellectual disability who is dually 

enrolled in secondary school and a 

comprehensive transition and 

postsecondary program. The 

commenters asked whether the LEA 

would pay for the comprehensive 

transition and postsecondary program or 

whether the student with an intellectual 

disability would apply for Federal Pell, 

FSEOG and FWS program assistance. 

Discussion: Under section 612(a)(1) of 

the IDEA and 34 CFR 300.101, each 

State and its LEAs must make FAPE 

available to all children with specified 

disabilities residing in the State, in 

mandatory age ranges. Under 34 CFR 

300.17(c) of the regulations 

implementing Part B of the IDEA, FAPE 

includes an appropriate preschool, 

elementary school, or secondary school 

education in the State involved. Under 

the IDEA, LEAs are not required to 

provide FAPE in postsecondary 

education settings. In general, Part B, 

IDEA funds could be used for 

appropriate education services included 

in an IEP that are provided outside of a 

public or private elementary or 

secondary school though, if, under State 

law, the education would be considered 

secondary school education. 

A student with an intellectual 

disability is eligible to receive Federal 

Pell Grant, FSEOG, and FWS program 

assistance under § 668.233 if the student 

satisfies the general student eligibility 

requirements under § 668.32, except for 

paragraphs (a), (e), and (f) of that 

section. Section 668.32(b) states that a 

student is not eligible to receive Federal 

Pell Grant, FSEOG, or FWS program 

assistance if he or she is enrolled in 

elementary or secondary school. In 

other words, if a student is dually 

enrolled in a secondary school and an 

eligible comprehensive transition and 

postsecondary program, he or she is not 

eligible for Federal Pell, FSEOG, and 

FWS program assistance. Therefore, 


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while an LEA could use Part B, IDEA 

funds to support a dually enrolled 

student with a disability’s participation 

in a comprehensive transition and 

postsecondary program if the services 

the student received in that program 

were considered secondary school 

education under State law and were 

included in the student’s IEP, the 

student would not be eligible to apply 

for Federal Pell Grant, FSEOG, and FWS 

program assistance. The Department 

will monitor the establishment of these 

comprehensive transition and 

postsecondary programs, and may 

consider at some point in the future 

using the Secretary’s waiver authority 

under the statute to permit qualifying 

students who are dually enrolled in 

these programs to also receive Federal 

Pell Grant, FSEOG, and FWS program 

assistance. If the Department were to 

adopt such an approach, we would 

provide additional information 

concerning the procedures and 

availability of any such waivers at that 

time. 

Changes: None. 

Comment: A few commenters 

requested that the regulations clarify 

whether the LEA is responsible for 

monitoring the progress of a student 

who is dually enrolled in a secondary 

school and a comprehensive transition 

and postsecondary program. 

Discussion: If a student with an 

intellectual disability who is dually 

enrolled in a comprehensive transition 

and postsecondary program receives 

services in that program that are 

considered secondary education in the 

State and are included in the student’s 

IEP, the SEA or LEA must monitor the 

student’s progress toward annual 

academic and functional goals, because 

those entities are responsible, under the 

IDEA, for ensuring that the services 

identified in the student’s IEP are 

provided. Additionally, eligible 

comprehensive transition and 

postsecondary programs, which operate 

through institutions, must meet the 

program requirements in § 668.232, 

including establishing a policy for 

determining whether a student enrolled 

in the comprehensive transition and 

postsecondary program is making 

satisfactory academic progress. In all 

cases, the Department encourages the 

SEA or LEA and the institution offering 

the comprehensive transition and 

postsecondary program to enter into a 

formal agreement of understanding that 

identifies what the SEA or LEA will 

provide to the dually-enrolled student, 

and what the institution will provide to 

meet the requirements of an eligible 

comprehensive transition and 

postsecondary program, and how the 

student’s progress will be assessed. 

Furthermore, section 612(a)(12) of the 

IDEA and its implementing regulations 

at 34 CFR 300.154 require States to 

develop and implement interagency 

agreements or other written mechanisms 

for interagency coordination to ensure 

that services necessary to provide FAPE 

to children with disabilities within the 

State that are provided or paid for by 

other public agencies are provided or 

paid for. These provisions mean that if 

public agencies of a State operate 

comprehensive transition and 

postsecondary programs that dually 

enroll students who are covered by the 

IDEA to provide services included in 

the students’ IEPs, the State must ensure 

that interagency agreements or other 

written mechanisms meeting these 

requirements are in place. 

Changes: None. 

Comment: A few commenters 

requested that the Department clarify 

the interaction between the receipt of 

Title IV, HEA aid and other benefits that 

the student may receive, such as 

Medicaid or vocational rehabilitation 

funding. Specifically, commenters 

expressed concern that a student’s 

receipt of Medicaid benefits or other 

benefits may be disrupted due to the 

student’s receipt of Federal Pell Grant, 

FSEOG, or FWS program assistance. 

Discussion: These final regulations 

implement provisions of the HEA only. 

They do not attempt to address any 

overlap between the protections and 

requirements of the State Medicaid 

program under Title XIX of the Social 

Security Act. Additional information 

concerning eligibility requirements for 

other programs may be sought from the 

agency responsible for implementing 

those programs. 

With respect to financial aid available 

to students under the HEA, a student’s 

financial aid assistance may be affected 

by aid received under other programs, 

such as Medicaid. While a student’s 

Federal Pell Grant award would not be 

reduced based on any other aid 

received, the amount of FSEOG and 

FWS program assistance for which a 

student is eligible is based, in part, on 

the student’s total estimated financial 

assistance (EFA), as defined in 

§ 673.5(c). A student’s FSEOG and FWS 

awards, when combined with the 

student’s other EFA, may not exceed the 

student’s financial need. Therefore, a 

student’s FSEOG and FWS awards may 

be affected by other aid the student 

receives. 

Changes: None. 

Comment: Several commenters 

expressed concern regarding the use of 

a student’s summary of academic and 

functional performance to meet the 

requirements under § 668.233(c). 

Commenters stated that a student’s 

summary of academic and functional 

performance should not serve as 

acceptable documentation to establish 

that the student has an intellectual 

disability. 

Discussion: To better prepare for the 

student’s enrollment in a 

comprehensive transition and 

postsecondary program, the Department 

encourages institutions to consider 

using a student’s summary of academic 

achievement and functional 

performance (SOP) as described in 34 

CFR 300.305(e)(3). That said, the 

Department recommends that 

institutions use the SOP only as 

supplemental information under 

§ 668.233(c). 

Section 300.305(e)(3) of the 

implementing regulations of the IDEA, 

consistent with section 614(c)(5)(B)(ii) 

of the IDEA, states that the summary 

required when a child graduates with a 

regular diploma or exceeds the age 

eligibility under State law must include 

information about the child’s academic 

achievement and functional 

performance, as well as 

recommendations on how to assist the 

child in meeting the child’s 

postsecondary goals. The Department 

believes that this supplemental 

information would provide the 

institution with a better understanding 

of a student’s abilities and limitations in 

determining an appropriate 

comprehensive transition and 

postsecondary program for the student. 

Changes: None. 

Comment: A few commenters 

expressed concern that a student’s 

documentation from an SEA under 

§ 668.233(c) might not include terms 

such as ‘‘intellectual disability’’ or 

‘‘mental retardation’’ and, therefore, 

may not be useful in establishing 

eligibility as student with an intellectual 

disability. One commenter stated that, 

in its school district, a student’s IEP 

does not include a disability category. 

The commenter asked how a student’s 

eligibility in this situation would be 

determined and whether the school 

district would have to complete an 

evaluation that states that the student 

has an intellectual disability. Another 

commenter asked if a student would 

need to have a specific diagnosis of 

intellectual disability to be eligible. 

Discussion: The issue raised by these 

comments is similar to the one 

addressed in response to comments on 

§ 668.231(b). Section 668.233(c) requires 

that an institution obtain a record from 

an LEA that the student is or was 

eligible for special education and 

related services under the IDEA, and if 


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the record does not identify the student 

as having an intellectual disability, 

documentation establishing that the 

student has an intellectual disability. 

The Department recognizes that 

documentation from an LEA (an IEP or 

transition plan, for example) may not 

state that a student has an intellectual 

disability. The Department believes that 

§ 668.233(c)(1) and (c)(2) addresses this 

issue, by requiring the institution to 

review all documentation obtained to 

establish that the student has an 

intellectual disability. Nothing in these 

provisions, however, requires LEAs to 

perform or pay for evaluations that they 

do not need for purposes of meeting 

requirements of the IDEA. 

Changes: None. 

Comment: A few commenters 

suggested that, whenever possible, 

existing documentation from school 

records or other sources, such as 

previous evaluations conducted by 

qualified professionals from public 

agencies, be used to determine that the 

student has an intellectual disability, 

and that the process for making this 

determination should be minimally 

burdensome for students, families, and 

institutions. 

Discussion: During negotiated 

rulemaking, some negotiators expressed 

concern that institutions would require 

updated evaluations that could be costly 

or cost prohibitive. In the preamble to 

the NPRM, the Department stated that 

an institution, as the party responsible 

for determining students’ eligibility for 

the Federal Pell, FSEOG, and FWS 

programs, would be allowed to accept 

the most recent documentation, even if 

it is more than a few years old. To 

further clarify, we do not believe it is 

appropriate to require in these 

regulations that the documentation 

submitted by the student have a 

minimum or maximum age, as long as 

the information used is the best 

available under the circumstances. 

Under § 668.233(c), if the record from 

the LEA does not state that the student 

has an intellectual disability, the 

institution also would have to obtain 

documentation to establish that the 

student has an intellectual disability, as 

defined under § 668.231(b). 

Changes: None. 

Part 690 Federal Pell Grant Program 

Two Federal Pell Grants in an Award 

Year (§§ 690.67, 690.64, and 690.63(h)) 

Student Eligibility for a Second 

Scheduled Award (§ 690.67) 

Comments: Several commenters 

agreed with the proposed regulations 

that would amend § 690.67(a)(1) to 

provide that a student would be eligible 

for a second Scheduled Award if the 

student has earned in an award year at 

a minimum the credit or clock hours of 

the first academic year of the student’s 

eligible program. However, a significant 

number of commenters objected to the 

proposed regulations as they would 

apply to term-based programs. In 

general, the commenters were 

concerned that the regulations would 

unduly limit the benefits to students of 

two Federal Pell Grants in an award 

year, would be overly complex and 

burdensome for institutions to 

administer, and would create confusion 

for students due to uncertainty in 

determining the students’ Federal Pell 

Grants and due to the different 

eligibility requirements for a second 

Scheduled Award. The commenters also 

believed that enabling an individual 

student to enroll in additional 

coursework during an award year 

should be considered acceleration 

without reference to the program’s 

length. Some commenters proposed that 

eligibility for payments be determined 

based on previous eligibility used and 

without reference to completion of the 

credit hours of an academic year. Some 

commenters proposed, as an alternative, 

for the Department to require that a 

student successfully complete the hours 

for which the Federal Pell Grant was 

paid to qualify for the second Scheduled 

Award. 

One commenter was concerned that 

the requirements would adversely affect 

students taking noncredit and reduced 

credit remedial coursework. 

Several commenters questioned the 

Department’s concern that the 

satisfactory academic progress standards 

in 34 CFR 668.16(e), as well as the new 

limitation under section 401(c)(5) of the 

HEA that a student’s lifetime eligibility 

is limited to nine Scheduled Awards if 

a student receives a Federal Pell Grant 

for the first time on or after July 1, 2008, 

did not provide sufficient minimum 

standards for ensuring a student’s 

advancement in his or her eligible 

program. Two commenters 

recommended revising the satisfactory 

academic progress requirements as an 

alternative to the proposed regulations. 

Discussion: We agree that the 

proposed regulations might unduly 

limit a Federal Pell Grant-eligible 

student’s ability to meet the costs of 

attending additional courses that would 

enable the student in an award year to 

accelerate his or her progress toward 

program completion and that the final 

regulations should not impede such 

acceleration. In addition, we agree that 

the proposed regulations could be 

considered complex and burdensome 

for some institutions to administer. We 

agree, in principle, with the 

recommendations of some commenters 

that payment should be tied to 

successful completion of the credit or 

clock hours for which a student has 

received Federal Pell Grant payments. 

Based on these comments, we believe it 

would be appropriate to require that, for 

a student to be eligible for payments 

from a second Scheduled Award in an 

award year, the student must be 

enrolled in credit or clock hours that 

were attributable to the student’s second 

academic year. A student in a termbased program would cease to be 

eligible for a payment from the second 

Scheduled Award if the student ceased 

to be enrolled in the credit hours 

attributable to the second Scheduled 

Award prior to the date for any 

recalculation for changes in enrollment 

status required by the institution’s 

recalculation policies established under 

§ 690.80(b). 

The eligibility requirements for a 

second Scheduled Award in an award 

year must be different from those for a 

first award, in that section 

401(b)(5)(A)(i) of the HEA requires 

enrollment on at least a half-time basis 

to receive a second Scheduled Award. 

This difference may be disconcerting to 

some students. However, we believe 

that students will be able to understand 

these requirements. 

We do not believe the regulations 

would adversely affect a student 

enrolled in noncredit or reduced-credit 

remedial coursework. The student’s 

remedial coursework would be 

considered in accordance with the 

requirements for determining 

equivalence to full-credit coursework 

under 34 CFR 668.20 when determining 

the student’s eligibility for a second 

Scheduled Award in an award year. 

We do not agree with the commenters 

concerning the efficacy of the current 

satisfactory academic progress standards 

and the new lifetime limit of nine 

Scheduled Awards in providing a 

sufficient basis for encouraging a 

student to accelerate program 

completion. Some institutions have 

adopted reasonable standards of 

satisfactory academic progress that 

would address our concerns. Others 

have used the flexibilities and options 

in the current regulations to fashion 

institutional standards that may meet 

the letter of the requirements in 34 CFR 

668.16(e) but in our view allow students 

who are not progressing satisfactorily to 

continue to receive title IV aid. Because 

of this variability and our belief that the 

new lifetime limit for Federal Pell 

Grants does not provide sufficient 

encouragement to accelerate program 

completion, we do not agree with the 


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suggestions that a payment of a second 

Scheduled Award may be made without 

reference to a student’s completion of 

the first academic year in an award year. 

Further, we believe that relying on 

current satisfactory progress standards 

would not be in accord with the student 

achievement and accountability 

principles for using additional funds 

appropriated for Federal Pell Grants 

under the American Recovery and 

Reinvestment Act of 2009 (Pub. L. 111– 

5). We agree with the commenters who 

recommended that we consider revising 

the satisfactory academic progress 

standards and have included this issue 

as a likely topic in the negotiated 

rulemaking on program integrity issues 

that is scheduled to commence on 

November 2, 2009. Information on this 

new negotiated rulemaking was 

published in the Federal Register on 

May 26, 2009 (74 FR 24728) and 

September 9, 2009 (74 FR 46399), 

respectively. 

Changes: We are revising 

§ 690.67(a)(1) to provide that an 

institution participating in the Federal 

Pell Grant Program shall award a 

payment of a second Scheduled Award 

to a student in an award year if an 

otherwise eligible student is enrolled for 

credit or clock hours that are 

attributable to the student’s second 

academic year in the award year. As a 

result of this change, we are also making 

conforming changes in § 690.67(c) for 

special circumstances in determining 

whether a student may qualify for a 

second Scheduled Award and in 

§ 690.64 as discussed under the heading 

‘‘Payment Period in Two Award Years 

(§ 690.64).’’ 

Transfer Students (§ 690.67(b)) 

Comments: One commenter 

supported § 690.67(b) as a 

straightforward treatment of transfer 

students. Another believed no provision 

was needed for transfer students if the 

Secretary ceased to require that 

eligibility for payment from a second 

Scheduled Award be based on 

completing the hours of the first 

academic year. One commenter cited 

examples where the provisions in 

§ 690.67(b) would result in inequitable 

treatment between continuously 

enrolled and transfer students. Another 

commenter believed that we should 

provide an ‘‘hours-earned’’ method as 

an option under which an institution 

with the necessary information may 

determine the credits or clock hours 

earned in the award year at other 

institutions that would be applicable to 

completing the first academic year. The 

commenter believed that there should 

also be a limitation on the need to 

recalculate a student’s eligibility based 

on the receipt of information subsequent 

to disbursements of a second Scheduled 

Award. Some commenters believed that 

the determination of a transfer student’s 

credit or clock hours should be based on 

the percentage of the student’s 

Scheduled Award used at the prior 

institution. 

Discussion: Based on the 

Department’s revision of § 690.67(a)(1), 

determining a transfer student’s credit 

or clock hours toward completion of the 

first academic year in an award year is 

still required. During negotiated 

rulemaking, the non-Federal negotiators 

noted that determination of the actual 

credits or clock hours earned at other 

institutions would be burdensome to the 

institution into which a student 

transfers and generally would be 

administratively difficult. To perform a 

determination of the actual credit or 

clock hours earned at other institutions, 

an institution would need to have the 

necessary information to determine 

whether credit or clock hours were 

earned in the current award year, 

regardless of whether the institution 

accepted them on transfer. The 

institution would also be required to 

resolve ambiguities such as whether the 

credit or clock hours of a summer 

payment period were considered earned 

in the current award year or whether 

credit or clock hours in a transcript 

were nonapplicable hours based on 

Advanced Placement (AP) programs, 

International Baccalaureate (IB) 

programs, testing out, life experience, or 

similar competency measures. 

While we recognized that there will 

be some inequities in applying the 

assumption method in § 690.67(b), we 

continue to believe that this method is 

appropriate for evaluating a transfer 

student’s eligibility when the alternative 

would be administratively burdensome 

to an institution. However, we also 

agree with the commenter who 

recommended that, if an institution 

chooses to do so, it may use an hoursearned method to determine the actual 

credit or clock hours earned at other 

institutions during the award year. 

Under § 690.67(b)(2) an institution 

that chooses to use the assumption 

method must determine the credit or 

clock hours that a transfer student has 

earned at a prior institution during the 

award year based on the Federal Pell 

Grant disbursements that the student 

received at the prior institution during 

the award year in relation to the 

student’s Scheduled Award at that prior 

institution. These same proportions are 

used to calculate the percentage of 

Scheduled Award used by a student. 

Following the provisions of 

§ 690.67(b)(2) would yield a more 

accurate determination of the credit or 

clock hours considered to be transferred 

than merely applying the percentage of 

Scheduled Award used. 

We agree with the concern regarding 

the receipt of additional information 

regarding a student’s payments at other 

institutions subsequent to determining 

the student’s eligibility for a second 

Scheduled Award and agree that some 

limitation on requiring a recalculation 

of prior payments would be appropriate. 

An institution may correctly make a 

determination of a student’s eligibility 

for a second Scheduled Award for a 

prior payment period based on the 

information available at that time. We 

do not believe it is necessary to impose 

the burden of requiring the institution to 

adjust a determination for a prior 

payment period that was correctly made 

during that prior payment period. 

However, we believe it is appropriate to 

provide that the institution may, at its 

option, revise the student’s eligibility 

for a prior payment based the receipt of 

additional information. 

Changes: We are revising § 690.67(b) 

to provide that an institution may, on an 

individual student basis, use an hoursearned method for determining a 

student’s credit or clock hours earned at 

other institutions in an award year as an 

alternative to the assumption method. 

We are also clarifying that an institution 

may, but is not required to, recalculate 

a student’s payment in a prior payment 

period in an award year if the 

institution receives information that 

would change the student’s eligibility 

for a second Scheduled Award in the 

prior payment period. The institution 

would be required to take into 

consideration the new information in 

determining eligibility for the current 

payment period if that payment period 

is in the same award year. 

Nonapplicable Credit or Clock Hours 

(§ 690.67(d)) 

Comment: One commenter did not 

support excluding the AP, IB, testing 

out, life experience, or similar 

competency measures in determining a 

student’s eligibility for a second 

Scheduled Award. The commenter 

believed that the exclusion would be 

burdensome to administer. 

Discussion: We do not agree with the 

commenter. A student’s eligibility for a 

second Scheduled Award is based, in 

part, on the student’s progress in 

earning the credits or clock hours of the 

first academic year in the award year. 

We continue to believe that this 

provision ensures that only those credits 

or clock hours earned in the award year 

are considered in determining the 


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student’s eligibility. While the provision 

may create some burden, it is essential 

to making a valid determination of a 

student’s eligibility for a second 

Scheduled Award. 

Changes: None. 

Payment Period in Two Award Years 

(§ 690.64) 

Comments: Several commenters 

supported the concept of requiring that 

a payment period scheduled to occur in 

two award years, a ‘‘crossover’’ payment 

period, be assigned to the award year in 

which the student would receive the 

greater payment for the payment period. 

A significant number of commenters 

believed these requirements would be 

administratively difficult to administer. 

Several commenters believed that the 

financial aid administrator should 

continue to have the discretion to assign 

a ‘‘crossover’’ payment period to either 

award year and should not be required 

to assign a crossover payment period to 

the award year in which the student 

would receive the greater payment for 

the payment period. The commenters 

also believed that a financial aid 

administrator should not be required to 

reassign the crossover payment period if 

subsequent information is received that 

would lead to a higher Federal Pell 

Grant for a student as required in 

§ 690.64 in the case of students enrolled 

on at least a three-quarter-time basis. 

One commenter believed that these 

requirements mandated that a student 

must file a Free Application for Federal 

Student Aid (FAFSA) for a crossover 

payment period. One commenter 

believed that a deadline should be 

established for being required to make 

reassignments of crossover payment 

periods. 

Several commenters believed that the 

determination of the higher payment 

should be made only at the time the 

Federal Pell Grant is initially awarded 

or packaged. Some commenters were 

concerned that increasing a crossover 

payment would necessitate cancelling 

all or a portion of a student’s loan. One 

commenter believed the increased 

payments would lead to overpayments 

in Federal Work-Study (FWS) 

assistance. The commenters believed 

these adjustments in the students’ 

awards would confuse students. Some 

commenters were concerned that 

requiring that the crossover payment 

period be in the second award year 

would adversely affect a student’s 

eligibility for loans since the institution 

would be required to place the crossover 

payment period in the second award 

year for purposes of awarding FFEL and 

Direct Loans. Two commenters stated 

that the award year placement of a 

student’s Federal Pell Grant may 

adversely affect the amount of the 

student’s State grant aid. Commenters 

were also concerned that institutions 

would delay disbursement to students 

eligible for a higher payment from the 

second award year until Federal funds 

were available on July 1 for that year. 

One of these commenters noted that 

State law prohibited an institution from 

advancing funds not yet received. The 

commenter proposed that, if necessary 

due to State law, an institution should 

be allowed to disburse funds at the 

beginning of a crossover payment period 

from the first award year to a student 

eligible for a higher payment form the 

second award year and then make the 

necessary adjustments after July 1 to 

provide the higher payment from the 

second award year. The commenter 

believed that this process would ensure 

funds are available to the student at the 

start of the payment period but 

ultimately yield the greater payment. 

One commenter questioned whether the 

results of verifying application 

information could lead to a 

reassignment of the payment period and 

adversely affect a student. Several 

commenters recommended that if a 

payment must be assigned to the 

subsequent award year, the Federal Pell 

Grant should be considered disbursed 

for purposes of the return of title IV 

funds under 34 CFR 668.22 even when 

the student withdraws prior to July 1. 

Discussion: We continue to believe 

that a crossover payment period should 

be assigned in a way that maximizes a 

student’s eligibility for that payment 

period even if this causes some 

administrative difficulties. The 

Department would consider an 

institution that delays disbursing funds 

from the second award year until July 1 

of that year, to be in compliance with 

these requirements if the institution 

disbursed funds at the beginning of the 

crossover payment period from the first 

award year to a student eligible for a 

higher payment from the second award 

year and then made the necessary 

adjustments after July 1 to provide the 

higher payment from the second award 

year as soon as funds were available on 

July 1. There is no requirement that a 

student submit a FAFSA for both award 

years to receive payment for a crossover 

payment period. We believe these 

benefits will be understood and 

appreciated by students. Further, with 

the changes made by the Department in 

these final regulations to § 690.67(a)(1), 

assigning a crossover payment period to 

the subsequent award year would 

generally no longer adversely impact a 

student’s ability to establish eligibility 

for a second Scheduled Award in that 

subsequent year. 

Contrary to the concerns expressed by 

some commenters, one of the major 

additional benefits for students of this 

requirement in § 690.64 is a reduction in 

student borrowing. The increase in the 

student’s Federal Pell Grant payment 

would increase the student’s estimated 

financial assistance and thus reduce the 

student’s need for loan funds for the 

payment period. Also, while it is 

unlikely that a combination of an 

increased Federal Pell Grant payment 

and FWS would result in a need to 

reduce the FWS award as one 

commenter indicated, no overaward for 

earnings from work would be created in 

the very limited cases in which a 

student may need to have FWS 

assistance canceled. 

We do not agree with the commenters 

who were concerned that requiring that 

the crossover payment period in the 

second award year would adversely 

affect a student’s eligibility for loans. 

The commenters believed that the 

institution would be required to place 

the crossover payment period in the 

new award year for purposes of 

awarding FFEL and Direct Loans. Under 

the requirements of the Title IV, HEA 

programs, the award year assignment of 

a student’s Federal Pell Grant has no 

affect on the award year assignment of 

the student’s other Federal student 

assistance, including loans. The amount 

of the Federal Pell Grant is estimated 

financial assistance for determining the 

need in the other programs. Institutions 

should ensure that their information 

technology systems provide for this 

necessary flexibility to ensure that 

students receive appropriate assistance 

in each award year. System 

requirements should not be the basis for 

limiting the assistance for which a 

student is eligible. 

We agree with the commenters that, 

in some limited instances under the 

current award regulations for State grant 

programs, a student’s State grant may be 

reduced because of an increase in the 

student’s Federal Pell Grant. We do not 

believe that we should use these limited 

circumstances as the basis for denying 

a student a higher Federal Pell Grant 

crossover payment. We believe that the 

States can make the necessary 

adjustments to their programs to 

maximize the overall aid available to 

these needy students. 

We do not agree that a reassignment 

of the payment period as a result of 

verification of application information 

would adversely affect a student. If, as 

a result of verification of application 

information, a student’s EFC and 

Federal Pell Grant eligibility changes for 


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an award year, that result would be 

taken into consideration in assigning a 

student’s crossover payment. If, for 

example, the crossover payment period 

were assigned to the first award year 

because it yielded the maximum Federal 

Pell Grant payment but verification of 

application information resulted in a 

lower EFC and increased Federal Pell 

Grant eligibility for the second award 

year, the crossover payment period 

would be reassigned to the second 

award year. 

With regard to the return of title IV 

funds, a disbursement for the 

subsequent award year may be made 

prior to July 1 using institutional funds 

rather than waiting to disburse when the 

subsequent award year Federal funds 

become available on July 1. Also, 

notwithstanding whether an institution 

chooses to make such a disbursement, 

the return of title IV funds takes into 

consideration both funds that were 

disbursed as well as funds that could 

have been disbursed. 

Based on these comments, we will 

establish deadlines specifically for these 

determinations through publication of a 

Federal Register notice. We will clarify 

the deadline when the receipt of 

information would require reassignment 

for a higher crossover payment and a 

deadline for a subsequent period when 

the receipt of information would 

support, but not require, an institution 

to make reassignments for a higher 

crossover payment. We expect to set the 

initial deadline based on the last date 

for submitting Student Aid Reports or 

Institutional Student Information 

Records for the first award year or a 

similar date as appropriate. During the 

subsequent period of time prior to the 

second deadline, an institution may 

establish such policies concerning 

reassignment of the crossover payment 

period as it determines best meet the 

needs of its students and the institution. 

Changes: We are revising proposed 

§ 690.64(b) to require that, regardless of 

a student’s enrollment status, the 

crossover payment period must be 

assigned to the award year in which the 

student would receive the greater 

payment for the payment period at the 

time the student’s Federal Pell Grant is 

initially calculated. We are also 

clarifying the deadlines by which an 

institution must take into account any 

information that changes a student’s 

payment by providing that an 

institution must make a reassignment to 

the award year providing the greater 

payment based on any additional 

information received by a deadline that 

the Secretary establishes through 

publication in the Federal Register for 

each award year. We are further 

providing that an institution may make, 

but is not required to make, a 

reassignment if additional information 

is received after the date established for 

required reassignments and not later 

than the deadline date for the first 

award year for administrative relief 

based on unusual circumstances that the 

Secretary establishes through 

publication in the Federal Register for 

each award year. 

We are also removing proposed 

§ 690.64(a)(2) and (c). Section 

690.64(a)(2) provided that a student may 

request a determination concerning the 

assignment of a crossover payment 

period, and § 690.64(c) required the 

assignment of a payment period with 

more than six months scheduled to 

occur within one award year to be 

assigned to that award year. These 

proposed provisions are no longer 

relevant under these revised 

requirements. 

Part 692—Leveraging Educational 

Assistance Partnership Program Grants 

for Access and Persistence Program 

(Subpart C of Part 692 Consisting of 

§§ 692.90 Through 692.130) 

Recruiting Eligible Students 

(§ 692.101(b)(2)) 

Comment: One commenter was 

concerned that early information and 

intervention, mentoring, or outreach 

programs (early intervention programs) 

are integral to the GAP Program, and the 

commenter believed that it would be 

difficult to identify students 

participating in early intervention 

programs who would be eligible for a 

LEAP Grant under GAP. The commenter 

believed that under current privacy laws 

identifying students who have 

participated in an eligible early 

intervention program and matching 

them with their FAFSA submissions 

and then with a GAP-participating 

postsecondary institution would appear 

to be impossible. The commenter 

questioned whether these requirements 

could be redefined to indicate that if the 

State partners with itself or another 

organization to provide early 

intervention programs at a particular 

high school that anyone who graduates 

with that high school cohort would be 

considered a ‘‘participating student.’’ 

The commenter believed this definition 

would remove the requirement of 

having to have personally identifiable 

information for each participant. The 

commenter also noted that additional 

guidelines would be needed for homeschooled students or those who 

participate in an early intervention 

program through a non-school-based 

program. 

Discussion: To the extent that the 

privacy provisions of FERPA (34 CFR 

part 99) apply to the particular 

circumstances of a State agency and 

other GAP participants in the State, the 

Department will provide technical 

assistance on any issues raised by the 

applicability of FERPA on a case-bycase basis. 

Changes: None. 

Executive Order 12866 

1. Regulatory Impact Analysis 

Under Executive Order 12866, the 

Secretary must determine whether the 

regulatory action is ‘‘significant’’ and 

therefore subject to the requirements of 

the Executive Order and subject to 

review by the OMB. Section 3(f) of 

Executive Order 12866 defines a 

‘‘significant regulatory action’’ as an 

action likely to result in a rule that may 

(1) have an annual effect on the 

economy of $100 million or more, or 

adversely affect a sector of the economy, 

productivity, competition, jobs, the 

environment, public health or safety, or 

State, local or tribal governments or 

communities in a material way (also 

referred to as an ‘‘economically 

significant’’ rule); (2) create serious 

inconsistency or otherwise interfere 

with an action taken or planned by 

another agency; (3) materially alter the 

budgetary impacts of entitlement grants, 

user fees, or loan programs or the rights 

and obligations of recipients thereof; or 

(4) raise novel legal or policy issues 

arising out of legal mandates, the 

President’s priorities, or the principles 

set forth in the Executive order. 

Pursuant to the terms of the Executive 

order, it has been determined this 

regulatory action will have an annual 

effect on the economy of more than 

$100 million. Therefore, this action is 

‘‘economically significant’’ and subject 

to OMB review under section 3(f)(1) of 

Executive Order 12866. Therefore, the 

Secretary has assessed the potential 

costs and benefits of this regulatory 

action and has determined that the 

benefits justify the costs. 

Need for Federal Regulatory Action 

As discussed in the NPRM, these 

regulations are needed to implement 

provisions of the HEA, as amended by 

the HEOA, related to changes to the 

Federal grant and work-study programs, 

campus safety, educational programs for 

students with intellectual disabilities, 

peer-to-peer file sharing and copyright 

infringement, teach-outs, readmission of 

servicemembers, and non-title IV 

revenue. 


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Regulatory Alternatives Considered 

Regulatory alternatives were 

considered as part of the rulemaking 

process. These alternatives were 

reviewed in detail in the preamble to 

the NPRM under both the Regulatory 

Impact Analysis and the Reasons 

sections accompanying the discussion 

to each regulatory provision. To the 

extent that they were addressed in 

response to comments received on the 

NPRM, alternatives are also considered 

elsewhere in this preamble to the final 

regulations under the Discussions 

sections related to each provision. No 

comments were received related to the 

Regulatory Impact Analysis discussion 

of these alternatives. 

As discussed above in the Analysis of 

Comments and Changes section, these 

final regulations reflect specific HEOA 

requirements, in many cases using 

language drawn directly from the 

statute, and minor revisions in response 

to public comments. In most cases, 

these revisions were technical in nature 

and intended to address drafting issues 

or to provide additional clarity. None of 

these changes result in revisions to cost 

estimates prepared for and discussed in 

the Regulatory Impact Analysis of the 

NPRM. 

Benefits 

As discussed in the NPRM, benefits 

provided in these regulations include 

greater transparency about consumer 

information and campus safety for 

prospective and current students at 

institutions participating in the Federal 

student financial assistance programs, 

copyright infringement policies, 

requirements for readmission of 

servicemembers, explanation of 

extenuating circumstances under which 

TEACH Grant service obligations may 

be excused, requirements for programs 

serving students with intellectual 

disabilities, and additional guidelines 

for Federal grant and work-study 

programs. It is difficult to quantify 

benefits related to the new institutional 

requirements, as there is little specific 

data available on consumers’ use of 

such information and the effect of the 

other provisions. In the NPRM, the 

Department requested comments or data 

that would support a more rigorous 

analysis of the impact of these 

provisions. No comments or additional 

data were received. 

Benefits under these regulations flow 

directly from statutory changes included 

in the HEOA; they are not materially 

affected by discretionary choices 

exercised by the Department in 

developing these regulations, or by 

changes made in response to comments 

on the NPRM. As noted in the 

Regulatory Impact Analysis in the 

NPRM, these provisions result in net 

costs to the government $1,644 million 

over years 2010–2014. 

Costs 

As discussed extensively in the 

Regulatory Impact Analysis of the 

NPRM, many of the statutory provisions 

implemented though these regulations 

will require regulated entities to 

develop new disclosures and other 

materials, as well as accompanying 

dissemination processes. In total, these 

changes are estimated to increase 

burden on entities or individuals 

participating in the Federal student 

assistance programs by 253,718 hours. 

Virtually all this increased burden is 

associated with institutions, with 80 

percent related to two provisions: peerto-peer file sharing and the award of two 

Pell Grants in a single award year. An 

extremely small amount—384 hours—is 

associated with students. The 

monetized cost of this additional 

burden, using loaded wage data 

developed by the Bureau of Labor 

Statistics, is $4.7 million. 

Given the limited availability of data 

underlying these burden estimates, in 

the NPRM the Department requested 

comments and supporting information 

for use in developing more robust 

estimates. In particular, we asked 

institutions to provide detailed data on 

actual staffing and system costs 

associated with implementing these 

regulations, especially the provisions 

related to peer-to-peer file sharing and 

administering two Pell Grants in one 

year. No comments or additional data 

were provided. 

Net Budget Impacts 

HEOA provisions implemented by 

these regulations are estimated to have 

a net budget impact of $297.4 million in 

2010 and $1.6 billion over FY 2011– 

2014. Consistent with the requirements 

of the Credit Reform Act of 1990, budget 

cost estimates for the student loan 

programs reflect the estimated net 

present value of all future nonadministrative Federal costs associated 

with a cohort of loans. A cohort reflects 

all loans originated in a given fiscal 

year. 

The budgetary impact of the 

regulations is entirely driven by 

statutory changes involving the 

provision of two Pell Grants in a single 

award year. The Department estimates 

almost no budgetary impact for other 

provisions included in these 

regulations. There is no data indicating 

that the extensive new requirements for 

disclosures for student loan program 

participants will have any impact on the 

volume or composition of Federal 

student loans. 

Assumptions, Limitations, and Data 

Sources 

As noted in the NPRM, because these 

regulations largely restate statutory 

requirements that would be selfimplementing in the absence of 

regulatory action, impact estimates 

provided in the preceding section reflect 

a pre-statutory baseline in which the 

HEOA changes implemented in these 

regulations do not exist. Costs have been 

quantified for five years. In developing 

these estimates, a wide range of data 

sources were used, including data from 

the National Student Loan Data System; 

operational and financial data from 

Department of Education systems, 

including especially the Fiscal 

Operations Report and Application to 

Participate (FISAP); and data from a 

range of surveys conducted by the 

National Center for Education Statistics 

such as the 2004 National 

Postsecondary Student Aid Survey, the 

1994 National Education Longitudinal 

Study, and the 1996 Beginning 

Postsecondary Student Survey. Data 

from other sources, such as the U.S. 

Census Bureau, were also used. 

Elsewhere in this SUPPLEMENTARY

INFORMATION section we identify and 

explain burdens specifically associated 

with information collection 

requirements. See the heading 

Paperwork Reduction Act of 1995. 

Accounting Statement 

As required by OMB Circular A–4 

(available at http:// 

www.Whitehouse.gov/omb/Circulars/ 

a004/a-4.pdf), in Table 2 below, we 

have prepared an accounting statement 

showing the classification of the 

expenditures associated with the 

provisions of these regulations. This 

table provides our best estimate of the 

changes in Federal student aid 

payments as a result of these 

regulations. The estimate for the period 

from 2010 to 2014 uses OMB 

discounting methodology and discount 

rates of seven and three percent. 

Expenditures are classified as transfers 

from the Federal government to student 

loan borrowers (for expanded loan 

discharges and teacher loan forgiveness 

payments). 


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TABLE 2—ACCOUNTING STATEMENT: CLASSIFICATION OF ESTIMATED EXPENDITURES

[In millions] 

Category Transfers 

Annualized Monetized Transfers .............................................................. $281 (7% discount rate). 

$277 (3% discount rate). 

From Whom to Whom? ............................................................................ Federal Government to Student Loan Borrowers. 

Regulatory Flexibility Act Certification 

The Secretary certifies that these 

regulations will not have a significant 

economic impact on a substantial 

number of small entities. These 

regulations affect institutions of higher 

education, lenders, and guaranty 

agencies that participate in Title IV, 

HEA programs and individual students 

and loan borrowers. The U.S. Small 

Business Administration Size Standards 

define institutions and lenders as ‘‘small 

entities’’ if they are for-profit or 

nonprofit institutions with total annual 

revenue below $5,000,000 or if they are 

institutions controlled by small 

governmental jurisdictions, which are 

comprised of cities, counties, towns, 

townships, villages, school districts, or 

special districts, with a population of 

less than 50,000. 

As discussed in more detail in the 

Regulatory Flexibility Act section of the 

NPRM, data from the Integrated 

Postsecondary Education Data System 

(IPEDS) indicate that roughly 2,660 

institutions participating in the Federal 

student assistance programs meet the 

definition of ‘‘small entities.’’ More than 

half of these institutions are short-term, 

for-profit schools focusing on vocational 

training. Other affected small 

institutions include small community 

colleges and tribally controlled schools. 

The Department estimates that total 

burden on small institutions from these 

regulations will be thirty-nine hours or 

less. Burden on institutions associated 

with these regulations is largely 

associated with the requirements to 

establish systems to limit illegal peer-topeer file sharing, readmission 

requirements for servicemembers, and 

new disclosures related to graduation 

rates, retention rates, fire safety, and 

campus safety. In each of these cases, 

the Department believes the new 

provisions do not represent a significant 

burden on a large number of schools. 

Provisions related to peer-to-peer file 

sharing, for example, only affect schools 

that provide students with schoolmaintained and operated internet 

services; many small institutions lack 

the resources or need to provide such 

services and so will not be affected by 

the provisions. For those that will be 

affected, the Department is encouraging 

the adoption of best practices which 

should reduce institutional burden. 

Data from the National Center for 

Education Statistics indicate that 

roughly two percent of students at small 

institutions receive veteran’s benefits; 

this figure significantly overstates the 

number of servicemembers likely to be 

readmitted under the regulations, but 

even using the two percent figure as a 

proxy for affected students, the 

Department believes this limited 

population will not represent a 

significant burden for small institutions. 

For the consumer information 

requirements, vocational institutions, 

which make up more than half of the 

schools meeting the definition of ‘‘small 

entities,’’ are already required to collect 

and distribute much of the required 

data. Even for schools that will face new 

requirements to collect and disseminate 

information about campus activities, the 

Department estimates additional burden 

at most institutions of three hours or 

less. 

In the NPRM, the Secretary invited 

small institutions to submit data 

supporting comments related to whether 

they believe the changes would have a 

significant economic impact on them. 

No data was received. In the absence of 

this data, and based on our internal 

analyses, the Department believes the 

new requirements contained in these 

regulations do not impose significant 

new costs on a substantial number of 

small institutions. 

Guaranty agencies are State and 

private nonprofit entities that act as 

agents of the Federal government, and 

as such are not considered ‘‘small 

entities’’ under the Regulatory 

Flexibility Act. The impact of the 

regulations on individuals is not subject 

to the Regulatory Flexibility Act. 

Paperwork Reduction Act of 1995 

Final §§ 668.14, 668.18, 668.23, 

668.28, 668.41, 668.43, 668.45, 668.46, 

668.49, 668.232, 668.233, 686.41, 

686.42, 690.63, 690.64, 690.67, 692.21, 

and 692.100, 692.101, 692.111 contain 

information collection requirements. 

Under the Paperwork Reduction Act of 

1995 (44 U.S.C. 3507(d)), the 

Department of Education has submitted 

a copy of these sections to the Office of 

Management and Budget (OMB) for its 

review. 

Section 600.5(a)(5)—Definition of 

Baccalaureate Liberal Arts Programs 

Offered by Proprietary Institutions 

The final change to § 600.5(a)(5) adds 

to the definition of proprietary 

institution of higher education an 

institution that provides a program 

leading to a baccalaureate degree in 

liberal arts that the institution has 

provided continuously since January 1, 

2009, so long as the institution has been 

accredited by a recognized regional 

accreditation agency or organization 

since October 1, 2007, or earlier. This 

change in the definition of a proprietary 

institution does not impact burden. 

While the current regulations point to 

OMB 1840–0098, we estimate that there 

is no change in burden associated with 

this section of the regulations as 

reported under the redesignated OMB 

Control Number 1845–0012. 

Section 668.14(b)(31)—Institutional 

Requirements for Teach-Outs/Eligibility 

and Certification Procedures 

The final regulations in 

§ 668.14(b)(31) require an institution to 

submit a teach-out plan to its 

accrediting agency whenever (1) the 

Department or their accrediting agency 

initiates an LS&T, or an emergency 

action against the institution, as 

required by statute; (2) the institution’s 

State licensing or authorizing agency 

revokes the institution’s license or legal 

authorization to provide an educational 

program; (3) the institution intends to 

close a location that provides 100 

percent of at least one program; or (4) 

the institution otherwise intends to 

cease operations. 

While the current regulations in 

§ 668.14 point to OMB 1840–0537, we 

estimate that the final changes in 

§ 668.14 will increase burden by 160 

hours for institutions under the 

redesignated OMB Control Number 

1845–0022. 

Section 668.18—Readmission 

Requirements for Servicemembers 

The final § 668.18 of the regulations 

include the general requirements that an 

institution may not deny readmission to 

a servicemember, but must readmit the 


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servicemember with the same academic 

status as when the student was last 

admitted to the institution. The final 

regulations clarify that the requirements 

also apply to a student who was 

admitted to an institution, but did not 

begin attendance because of service in 

the uniformed services. The final 

regulations specify that the institution 

must promptly readmit a student, and 

define ‘‘promptly readmit’’ as 

readmitting a student into the next class 

or classes in the student’s program 

unless the student requests a later date 

of admission, or unusual circumstances 

require the institution to admit the 

student at a later date. The final 

regulations require the institution to 

make reasonable efforts to help the 

student become prepared or to enable 

the student to complete the program 

including, but not limited to, providing 

refresher courses at no extra cost and 

allowing the student to retake a pretest 

at no extra cost. The institution would 

not be required to readmit the student 

if, after reasonable efforts by the 

institution, the student is still not 

prepared to resume the program at the 

point where he or she left off, or is still 

unable to complete the program. 

The final regulations require an 

institution to designate one or more 

offices for the purpose of receiving 

advance notice from students of their 

absence from the institution 

necessitated by service in the uniformed 

services, and notice from students of 

intent to return to the institution. 

However, such notices do not need to 

follow any particular format, nor would 

a student have to indicate if the student 

intends to return to the institution. Also, 

any such notice may be provided by an 

appropriate officer of the U.S. Armed 

Forces. The notice of intent to return 

may be provided orally or in writing 

and would not need to follow any 

particular format. A period of absence 

from the institution before or after 

performing service in the uniformed 

services do not count against the period 

of uniformed service which is limited to 

the five years. 

The final regulations list the 

documentation that supports the 

institution’s determination for 

readmission that a student must submit 

with an application for readmission. 

The final regulations make clear that the 

types of documentation available or 

necessary will vary from case to case. 

The final regulations list the 

circumstances that a student’s eligibility 

for readmission to an institution would 

be terminated. 

We estimate that the final changes 

will increase burden for students by 384 

hours and for institutions by 1,129 

hours for a total increase in burden of 

1,513 hours in OMB Control Number 

1845–NEW1. 

Non-Title IV Revenue Requirement 

(90/10) 

Section 668.28(a)—Calculating the 

Revenue Percentage 

The final regulations in § 668.28(a) 

implement the statutory provisions 

relating to counting revenue from nontitle IV eligible programs. 

Regarding institutional loans for 

which a net present value (NPV) would 

be calculated, the final regulations 

establish that institutional loans have to 

be credited in-full to the students’ 

accounts, be evidenced by standalone 

repayment agreements between students 

and the institution, and be separate from 

enrollment contracts signed by students. 

To count revenue from loan funds in 

excess of the loan limits in effect prior 

to ECASLA in the allowable revenue 

category, the final regulations allow 

institutions to count the excess amount 

on a payment-period basis. 

We estimate that the final regulations 

will increase burden for institutions; 

however, these final regulations only 

define non-title IV revenue. The burden 

increase is found in § 668.28(b) and (c) 

under OMB 1845–NEW2. 

Section 668.28(b)—Net Present Value 

The final regulation in § 668.28(b) 

defines the NPV as the sum of the 

discounted cash flows. Appendix C 

illustrates how an institution calculates 

its 90/10 revenue percentage. 

The final regulations allow a simpler 

alternative to performing the NPV 

calculation, by allowing an institution 

to use 50 percent of the total amount of 

loans it made during the fiscal year as 

the NPV. However, as a condition of 

using the 50 percent alternative 

calculation, if the institution chooses to 

use this alternative, it may not sell any 

of the associated loans until they have 

been in repayment for at least two years. 

We estimate that the final regulations 

will increase burden for institutions by 

3,087 hours in the new OMB Control 

Number 1845–NEW2. 

Section 668.28(c)—Non-Title IV 

Revenue (90/10) 

The final regulations in § 668.28(c) 

removes all of the 90/10 provisions from 

34 CFR 600.5 and relocates the amended 

provisions to subpart B of part 668. The 

final regulations amend the program 

participation agreement to specify that a 

proprietary institution must derive at 

least 10 percent of its revenue from 

sources other than Title IV, HEA 

program funds. If an institution does not 

satisfy the 90/10 requirement, the final 

regulations require the institution to 

notify the Department no later than 45 

days after the end of its fiscal year that 

it failed to satisfy the 90/10 

requirement. In keeping with 

provisional certification requirements 

the current regulations are amended by 

adding final language to provide that a 

proprietary institution’s certification 

automatically becomes provisional if it 

fails the 90/10 requirement for any fiscal 

year. 

We estimate that the final regulations 

in § 668.28(c) will increase burden for 

institutions by 1 hour in the new OMB 

Control Number 1845–NEW2. 

Section 668.23(d)(4)—Audited Financial 

Statements 

The final regulations in § 668.23(d)(4) 

require that a proprietary institution 

must disclose in a footnote to its 

financial statement audit the percentage 

of its revenues derived from the Title IV, 

HEA program funds that the institution 

received during the fiscal year covered 

by that audit. The institution must also 

report in the footnote the non-Federal 

and Federal revenue by source that was 

included in the 90/10 calculation. 

While the current regulations point to 

OMB Control Number 1840–0697, we 

estimate that the final regulations in 

§ 668.23(d)(4) will increase burden for 

institutions by 165 hours for the 

redesignated OMB Control Number 

1845–0038. 

Section 668.43(a)(5)(iv)—Institutional 

Plans for Improving the Academic 

Program 

The final regulations in § 668.43(a) 

amend the information about the 

academic program that the institution 

must make readily available to enrolled 

and prospective students about any 

plans by the institution for improving 

any academic program at the institution. 

An institution is allowed to determine 

what a ‘‘plan’’ is, including when a plan 

becomes a plan. 

We estimate that the final regulations 

will increase burden for institutions by 

968 hours in OMB Control Number 

1845–0022. 

Sections 668.14(b) and 668.43(a)—Peerto-Peer File Sharing/Copyrighted 

Material 

Section 668.14(b)(30)—Program 

Participation Agreement (PPA) 

The final regulations require an 

institution, as a condition of 

participation in a Title IV, HEA 

program, to agree that it has developed 

and implemented plans to effectively 

combat the unauthorized distribution of 

copyrighted material by users of the 


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institution’s network without unduly 

interfering with the educational and 

research use of the network. 

An institution’s plan must include: 

• The use of one or more technologybased deterrents; 

• Mechanisms for educating and 

informing its community about 

appropriate versus inappropriate use of 

copyrighted material; 

• Procedures for handling 

unauthorized distribution of 

copyrighted material, including 

disciplinary procedures; and 

• Procedures for periodically 

reviewing the effectiveness of the plans. 

The final regulations make clear that 

no particular technology measures are 

favored or required for inclusion in an 

institution’s plans, and each institution 

retains the authority to determine what 

its particular plans for compliance will 

be, including those that prohibit content 

monitoring. 

The final regulations require an 

institution, in consultation with the 

chief technology officer or other 

designated officer of the institution, to 

the extent practicable, offer legal 

alternatives to illegal downloading or 

otherwise acquiring copyrighted 

material, as determined by the 

institution. The final regulations also 

require that institutions (1) periodically 

review the legal alternatives for 

downloading or otherwise acquiring 

copyrighted material and (2) make the 

results of the review available to their 

students through a Web site and/or 

other means. 

While the current regulations in 

§ 668.14 point to OMB 1840–0537, we 

estimate that the final changes in 

§ 668.14(b)(30) will increase burden by 

91,120 hours for institutions under the 

redesignated OMB Control Number 

1845–0022. 

Section 668.43(a)(10)—Consumer 

Information 

The final regulations requires 

information regarding institutional 

policies and sanctions related to the 

unauthorized distribution of 

copyrighted material be included in the 

list of institutional information 

provided upon request to prospective 

and enrolled students. This information 

must (1) explicitly inform enrolled and 

prospective students that unauthorized 

distribution of copyrighted material, 

including peer-to-peer file sharing, may 

subject a student to civil and criminal 

liabilities; (2) include a summary of the 

penalties for violation of Federal 

copyright laws; and (3) delineate the 

institution’s policies with respect to 

unauthorized peer-to-peer file sharing, 

including disciplinary actions that are 

taken against students who engage in 

illegal downloading or unauthorized 

distribution of copyrighted materials 

using the institution’s information 

technology system. 

We estimate that the final regulations 

in § 668.43(a)(10) will increase burden 

for institutions by 1,424 hours in OMB 

Control Number 1845–0022. 

Section 668.41—Reporting and 

Disclosure of Information 

The final regulations in § 668.41 add 

retention rate information, placement 

rate information, and information on the 

types of graduate and professional 

education in which graduates of the 

institution’s four-year degree programs 

enroll, to the types of information that 

an institution must provide to its 

enrolled and prospective students. 

When reporting its retention rate, an 

institution must disclose the 

institution’s retention rate as defined by 

and reported to the Integrated 

Postsecondary Education Data System 

(IPEDS). The institution may use 

various sources of retention rate 

information and information on types of 

graduate and professional education in 

which graduates of the institution’s 

four-year degree programs enroll (such 

as State data systems, surveys, or other 

relevant sources). If an actual placement 

rate is calculated by the institution, it 

must be disclosed. The institution 

would have to identify the source of the 

information it discloses, as well as the 

time frames and methodology associated 

with that information. 

While the current regulations point to 

both OMB 1845–0004 and OMB 1845– 

0010, OMB 1845–0010 has been 

recently discontinued, therefore, we 

estimate that the final regulations will 

increase burden for institutions 8,541 

hours in OMB Control Number 1845– 

0004. 

Section 668.45—Information on 

Completion or Graduation Rates 

Under the final regulations in 

§ 668.45, an institution’s completion 

and graduation rate information must be 

disaggregated by gender, by each major 

racial and ethnic subgroup, and by 

whether or not the institution’s students 

received certain types of Federal student 

aid. The disaggregation by receipt of aid 

is categorized by: 

Recipients of a Federal Pell Grant; 

Recipients of a Federal Family 

Education Loan or a Federal Direct Loan 

(other than an Unsubsidized Stafford 

Loan); and 

Recipients of neither a Federal Pell 

Grant nor a Federal Family Education 

Loan or a Federal Direct Loan (other 

than an Unsubsidized Stafford loan). 

The institution reports its completion 

and graduation rate information in a 

disaggregated fashion only if the 

number of students in each category is 

sufficient to yield statistically reliable 

information, and doing so would not 

reveal personally identifiable 

information about an individual 

student. 

We estimate that the final regulations 

will increase burden for institutions 

7,488 hours in OMB Control Number 

1845–0004. 

Campus Safety Provisions 

Section 668.46(c)(3)—Hate Crime 

Reporting 

The final regulations add the crimes 

of ‘‘larceny-theft,’’ ‘‘simple assault,’’ 

‘‘intimidation,’’ and ‘‘destruction/ 

damage/vandalism of property’’ to the 

crimes that must be reported in hate 

crime statistics. Additionally, the final 

regulations update the definitions of the 

terms ‘‘Weapons: carrying, possessing, 

etc.,’’ ‘‘Drug abuse violations,’’ and 

‘‘Liquor law violations’’ which are 

excerpted from the Federal Bureau of 

Investigation’s Uniform Crime Reporting 

Program, to reflect changes made by the 

FBI to these definitions in 2004. 

We estimate that the final regulations 

will increase burden for institutions by 

5,695 hours in OMB Control Number 

1845–0022. 

Reporting Emergency Response and 

Evacuation Procedures 

Section 668.46(e)—Timely Warning and 

Emergency Notification 

The final regulations clarify the 

difference between the existing timely 

warning requirement and the new 

requirement for an emergency 

notification policy. While a timely 

warning must be issued in response to 

specific crimes, an emergency 

notification is required in the case of an 

immediate threat to the health or safety 

of students or employees occurring on 

campus. The final language clarifies that 

an institution that follows its emergency 

notification procedures is not required 

to issue a timely warning based on the 

same circumstances; however, the 

institution must provide adequate 

follow-up information to the community 

as needed. 

We estimate that the final regulations 

will increase burden for institutions by 

1,424 hours in OMB Control Number 

1845–0022. 

Section 668.46(g)—Emergency Response 

and Evacuation Procedures 

The final regulations outline the 

elements that an institution must 

include in its statement of policy 


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describing its emergency response and 

evacuating procedures in its annual 

security report to include the following: 

Procedures to immediately notify the 

campus community upon the 

confirmation of a significant emergency 

or dangerous situation involving an 

immediate threat occurring on the 

campus. 

A description of the process that (1) 

confirms that there is a significant 

emergency or dangerous situation, (2) 

determines the appropriate segment or 

segments of the campus community to 

receive a notification, (3) determines the 

content of the notification, and (4) 

initiates the notification system. 

A statement that the institution will, 

without delay, and taking into account 

the safety of the community, determine 

the content of the notification and 

initiate the notification system, unless 

issuing the notification will, in the 

professional judgment of responsible 

authorities, compromise efforts to assist 

a victim or to contain, respond to, or 

otherwise mitigate the emergency. 

A list of the titles of the persons or 

organizations responsible for carrying 

out the actions required. 

Procedures for disseminating 

emergency information to the larger 

community. 

Procedures for testing its emergency 

response and evacuation procedures on 

at least an annual basis with at least one 

test per calendar year, and be 

documented, including a description of 

the exercise, the date, time, and if it was 

announced or unannounced. 

We estimate that the final regulations 

will increase burden for institutions by 

11,390 hours in OMB Control Number 

1845–0022. 

Missing Student Procedure 

Section 668.41(a)—Definition of OnCampus Student Housing Facility 

The final regulations in § 668.41(a) 

would add a definition of the term oncampus student housing facility to mean 

a dormitory or other residential facility 

for students that is located on an 

institution’s campus. 

The final definition is added to clarify 

what is meant by on-campus student 

housing facility and to link the meaning 

of ‘‘on-campus’’ to the current 

regulatory definition of campus in 

§ 668.46(a), which is used for crime 

reporting under § 668.46(c). The final 

change is to a definition and does not 

impact burden. 

While the current regulations point to 

both OMB 1845–0004 and OMB 1845– 

0010, OMB 1845–0010 has recently 

been discontinued. We estimate that 

there is no change in burden associated 

with this section of the regulations as 

reported under OMB Control Number 

1845–0004. 

Section 668.46(b)—Annual Security 

Report 

The final regulations in § 668.46(b) 

require an institution to include its 

missing student notification policy and 

procedures in its annual security report. 

This is required beginning with the 

annual security report distributed by 

October 1, 2010. 

We estimate that the final regulations 

will increase burden for institutions by 

456 hours for an increase in burden in 

OMB Control Number 1845–0022. 

Section 668.46(h)—Missing Student 

Notification Policy 

The final regulations in § 668.46(h) 

implement the new statutory 

requirements, specifying that a 

statement of policy regarding missing 

student notification for students 

residing in on-campus student housing 

facilities must include: 

A list of the titles of the persons or 

organizations to which students, 

employees, or other individuals should 

report that a student has been missing 

for 24 hours; 

A requirement that any official 

missing student report be immediately 

referred to the institution’s police or 

campus security department or, if not 

applicable, to the local law enforcement 

agency with jurisdiction in the area; 

The option for each student to 

identify a contact person to be notified 

if the student is determined missing by 

the institutional police or campus 

security department, or the local law 

enforcement agency; and 

A disclosure that contact information 

will be registered and maintained 

confidentially. 

The final regulations further require 

an institution to advise students who 

are under 18 and not emancipated that 

if the student is missing, it will notify 

a custodial parent or guardian in 

addition to any contact person 

designated by the student. All students 

must also be advised that, regardless of 

whether they name a contact person, the 

institution must notify the local law 

enforcement agency that the student is 

missing, unless the local law 

enforcement was the entity that 

determined that the student is missing. 

The final regulations reflect the new 

statutory requirements. These 

regulations do not preclude the 

institution from contacting the student’s 

contact person or the parent 

immediately upon determination that 

the student has been missing for 24 

hours. 

We estimate that the final regulations 

will increase burden for institutions by 

2,423 hours for an increase in burden in 

OMB Control Number 1845–0022. 

Fire Safety Standards 

Section 668.41(e)—Annual Fire Safety 

Report 

The final regulations provide that 

institutions that maintain an on-campus 

student housing facility must distribute 

an annual fire safety report and to create 

publication requirements for the annual 

fire safety report that are similar to the 

long-standing rules for the annual 

security report. 

The final regulations allow an 

institution to publish the annual 

security report and the annual fire safety 

report together, as long as the title of the 

document clearly states that it contains 

both the annual security report and the 

annual fire safety report. If an 

institution chooses to publish the 

reports separately, it would have to 

include information in each of the two 

reports about how to directly access the 

other report. 

While the current regulations point to 

both OMB 1845–0004 and OMB 1845– 

0010, OMB 1845–0010 has recently 

been discontinued. The burden 

associated with the data collection and 

reporting for the annual fire safety 

report is reflected in § 668.49 as 

reported under OMB Control Number 

1845–NEW3. 

Section 668.49—Annual Fire Safety 

Report 

The final regulations define the 

following terms relevant to the fire 

safety reporting requirements: Cause of 

fire; Fire; Fire drill; Fire-related injury; 

Fire-related death; Fire-safety system; 

and Value of property damage. 

The final regulations require an 

institution to report to the public, the 

statistics that it submits to the 

Department in its annual fire safety 

report. The institution must provide 

data for the three most recent calendar 

years for which data are available. The 

first full report to contain the full three 

years of data would be the report due on 

October 1, 2012. 

The final regulations outline the 

elements that an institution must 

disclose in its annual fire safety report, 

including: Fire statistics; A description 

of each on-campus student housing 

facility fire safety system; The number 

of regular, mandatory, supervised fire 

drills held during the previous calendar 

year; Policies or rules on portable 

electrical appliances, smoking, and 

open flames in student housing 

facilities; Procedures for student 


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housing evacuation in the case of a fire; 

Policies on fire safety education and 

training programs provided to students, 

faculty, and staff; A list of the titles of 

each person or organization to which 

students and employees should report 

that a fire has occurred; and Plans for 

future improvements in fire safety. 

The final regulations specify that an 

institution that maintains an on-campus 

student housing facility must maintain 

a written and easily understood fire log 

that records, by the date that the fire 

was reported (as opposed to by the date 

that the fire occurred), any fire that 

occurred in an on-campus student 

housing facility. The log would have to 

include the nature, date, time, and 

general location of each fire, and require 

that the log be available for the public. 

These final regulations also implement 

the statutory requirement that an 

institution make an annual report to the 

campus community on the fires 

recorded in the fire log; however, this 

requirement may be satisfied by the 

annual fire safety report described in 

final § 668.49(b). 

We estimate that the final regulations 

will increase burden for institutions by 

7,283 hours in OMB Control Number 

1845–NEW3. 

Financial Assistance for Students With 

Intellectual Disabilities 

Section 600.5—Proprietary Institution of 

Higher Education 

The final regulations in 

§ 600.5(a)(5)(i)(B)(2)(ii) define a 

proprietary institution of higher 

education as one that may have a 

comprehensive transition and 

postsecondary program as an eligible 

program when it is approved by the 

Secretary. This change in the definition 

of an eligible program does not impact 

burden. 

While the current regulations in 

§ 600.5 point to OMB 1840 -0098, this 

information collection has been 

discontinued and redesignated to 1845– 

0012. We estimate that there is no 

change in burden associated with this 

final change in the regulations. 

Section 668.8—Eligible Program 

The final regulations in § 668.8(n) 

define a comprehensive transition and 

postsecondary program as an eligible 

program when it is approved by the 

Secretary. The final change in the 

definition of an eligible program does 

not impact burden. 

While the current regulations in 

§ 668.8 point to OMB 1845–0537, this 

collection package has been 

discontinued, we estimate that there is 

no change in burden associated with 

this final change in the regulations. 

Section 668.232—Program Eligibility 

The final regulations require an 

institution that wishes to provide a 

comprehensive transition and 

postsecondary program to apply and 

receive approval from the Secretary. The 

final regulations outline the elements 

that an institution must include in its 

application, including: A detailed 

description of the comprehensive 

transition and postsecondary program; 

The policy for determining whether a 

student enrolled in the program is 

making satisfactory academic progress; 

A statement of the number of weeks of 

instructional time and the number of 

semester or quarter credit hours or clock 

hours in the program; A description of 

the educational credential offered or 

identified outcome or outcomes 

established by the institution for all 

students enrolled in the program; A 

copy of the letter or notice sent to the 

institution’s accrediting agency 

informing the agency of its 

comprehensive transition and 

postsecondary program; and Any other 

information the Department may 

require. 

We estimate that the final regulations 

will increase burden for institutions by 

66 hours in OMB Control Number 1845– 

NEW4. 

Section 668.233—Student Eligibility 

The final regulations in § 668.233 

provide that a student with intellectual 

disabilities enrolled in a comprehensive 

transition and postsecondary program 

may be eligible for Title IV, HEA 

program assistance under the Federal 

Pell grant, FSEOG, and FWS programs 

if: The student is making satisfactory 

academic program in accordance with 

the institution’s published standards for 

students enrolled in the comprehensive 

transition and postsecondary program; 

and the institution obtains a record from 

a LEA that the student is or was eligible 

for FAPE under the IDEA. If the FAPE 

record does not indicate that the student 

has an intellectual disability, the 

institution must obtain documentation 

from another source that identifies the 

intellectual disability. 

We estimate that the final regulations 

will increase burden for institutions by 

768 hours in OMB Control Number 

1845–NEW4. 

Section 668.43(a)(7)—Institutional 

Information 

The final regulations change the 

phrase ‘‘any special facilities and 

services’’ to ‘‘the services and facilities,’’ 

and replaces the phrase ‘‘disabled 

students’’ with ‘‘students with 

disabilities.’’ The final changes also 

clarify that a description of services and 

facilities for students with disabilities 

must also contain the services and 

facilities available for students with 

intellectual disabilities. 

We estimate that the final regulations 

will increase burden for institutions by 

44 hours in OMB Control Number 1845– 

0022. 

Federal Work Study Programs 

Section 675.16—Conforming FWS 

Payment Requirements to the Cash 

Management Regulations 

The final regulations in 

§ 675.16(b)(1)(ii) and (b)(2), amend the 

FWS regulations in three ways regarding 

the use of current award year FWS 

funds to pay prior award year charges. 

First, the amount of prior award year 

charges that could be paid with current 

award year FWS funds increases to not 

more than $200. Second, the FWS 

provision that allows an institution to 

pay for prior award year charges of $100 

or more is removed. Finally, we clarify 

that the $200 limit applies to all Title 

IV, HEA program funds that an 

institution uses to pay prior-year 

charges. These changes to conform the 

FWS payment requirements to the 

current cash management regulations do 

not impact burden. 

We estimate that there is no change in 

burden associated with this section of 

the regulations under OMB Control 

Number 1845–0019. 

TEACH Grant Program 

Section 686.41—Period of Suspension 

The final regulations in § 686.41 

provide that a TEACH Grant recipient 

who is called or ordered to active 

military duty (or his or her 

representative) may request a 

suspension of the eight-year period in 

increments not to exceed three years. 

Once the recipient has exceeded the 3- 

year suspension period, the recipient (or 

his or her representative) may request a 

discharge of all or a portion of his or her 

teaching service obligation. 

We estimate that the final regulations 

will increase burden for institutions in 

OMB Control Number 1845–0083. The 

Department will submit an 83–C 

incorporating the changes after the final 

regulations have published. 

Section 686.42—Discharge of 

Agreement To Serve 

The final regulations in § 686.42 

provide that the recipient may qualify 

for a proportional discharge of his or her 

service obligation based on the number 

of years the recipient has been called or 

ordered to active military duty. 


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To obtain the discharge, the recipient 

(or his or her representative) is required 

to provide the Department: 

A written statement from his or her 

commanding or personnel officer 

certifying that the recipient is on active 

duty status in the U.S. Armed Forces, 

the date on which that service began, 

and the date the service is expected to 

end; and a copy of his or her official 

military orders and military 

identification. 

The Department would notify a 

TEACH Grant recipient of the decision 

reached on his or her request for a 

partial or full discharge of the teaching 

service obligation. The grant recipient is 

responsible for fulfilling any teaching 

service obligation that is not discharged. 

We estimate that the final regulations 

will increase burden for institutions in 

OMB Control Number 1845–0083. The 

Department will submit an 83–C 

incorporating the changes after the final 

regulations have published. 

Federal Pell Grant Program 

Two Federal Pell Grants in an Award 

Year 

Section 690.67(a)—Student Eligibility 

for a Second Scheduled Award 

The final regulations amend 

§ 690.67(a) to provide that a student is 

eligible for a second Scheduled Award 

if the student is enrolled for credit or 

clock hours attributable to the student’s 

second academic year in the award year, 

and is enrolled as at least a half-time 

student in a program leading to a 

bachelor’s or associate degree or other 

recognized educational credential (such 

as a postsecondary certificate or 

diploma), except as provided for 

students with intellectual disabilities. 

To the extent that the institution will be 

reporting these second Scheduled 

Award Pell disbursements via the 

Common Origination and Delivery 

(COD) system, there will be some 

additional burden for institutions. 

We estimate that the regulations will 

increase burden for institutions by 

47,432 hours in OMB Control Number 

1845–NEW5. 

Section 690.67(b)—Transfer Students 

The final regulations in § 690.67(b) 

provide that an institution determine 

the credit or clock hours that a transfer 

student has earned at a prior institution 

during the award year based on the 

Federal Pell Grant disbursements that 

the student received at the prior 

institution during the award year in 

relation to the student’s Scheduled 

Award at that prior institution. The 

credit or clock hours that the student 

would be considered to have earned 

would be in the same proportion to 

credit or clock hours in the current 

institution’s academic year as the 

disbursements that the student has 

received at the prior institution in the 

award year are in proportion to the 

student’s Scheduled Award at the prior 

institution. 

To the extent that the institution will 

be reviewing the transfer records of 

these students and subsequently 

reporting second Scheduled Award Pell 

disbursements via the Common 

Origination and Delivery (COD) system, 

there will be some additional burden for 

institutions. 

We estimate that the final regulations 

will increase burden for institutions by 

14,400 hours in OMB Control Number 

1845–NEW5. 

Section 690.67(c)—Special 

Circumstances 

The final regulations in § 690.67(c) 

provide that in a payment period where 

there is insufficient remaining eligibility 

from the first Scheduled Award to make 

full payment for the payment period, a 

financial aid administrator may waive 

the requirement that a student complete 

the credit or clock hours in the student’s 

first academic year in the award year 

due to circumstances beyond the 

student’s control. The financial aid 

administrator is required to make and 

document the determination on an 

individual basis. 

To the extent that the institution will 

be documenting these special 

circumstances and subsequently 

awarding second Pell grants, the 

institutions will be reporting the second 

Pell disbursements via the Common 

Origination and Delivery (COD) system, 

there will be some additional burden for 

institutions. 

Section 690.67(d)—Nonapplicable 

Credit or Clock Hours 

The final regulation in § 690.97(d) 

states that, in determining a student’s 

eligibility for a second Scheduled 

Award in an award year, an institution 

may not use credit or clock hours that 

the student received based on Advanced 

Placement (AP) programs, International 

Baccalaureate (IB) programs, testing out, 

life experience, or similar competency 

measures. 

To the extent that institutions will be 

making determinations about the 

applicability of AP, IB, or other nonapplicable courses, institutions will 

subsequently award second Pell grants 

and thereafter report Pell disbursements 

via the Common Origination and 

Delivery (COD) system, thus there will 

be some additional reporting burden for 

institutions. 

We estimate that the final regulations 

will increase burden for institutions by 

2,032 hours in OMB Control Number 

1845–NEW5. 

Section 690.64—Payment Period in Two 

Award Years 

The final regulation in § 690.64 states 

that, if a student is enrolled in a 

crossover payment period as a half-time 

or less-than-half-time student, the 

current requirements generally apply. 

If a student is enrolled as a threequarter-time or full-time student, an 

institution must consider the payment 

period to be in the award year in which 

the student would receive the greater 

payment for the payment period based 

on the information available at the time 

that the student’s Federal Pell Grant is 

initially calculated. If the institution 

subsequently receives information that 

the student would receive a greater 

payment for the payment period by 

reassigning the payment to the other 

award year, the institution is required to 

reassign the payment to the award year 

providing the greater payment within 

specified time frames. 

A student may request that the 

institution place the payment period in 

the award year that can be expected to 

result in the student receiving a greater 

amount of Federal Pell Grants over the 

two award years in which the payment 

period is scheduled to occur. If the 

student makes that request, the 

institution must assign the payment 

period to that award year. 

To the extent that the institution will 

be reviewing enrollment status in each 

of the two award years and making 

determinations about which award year 

must be used and subsequently 

reporting these second Scheduled 

Award Pell disbursements via the 

Common Origination and Delivery 

(COD) system, there will be some 

additional burden for institutions. 

We estimate that the final regulations 

will increase burden for institutions by 

33,881 hours in OMB Control Number 

1845–NEW5. 

Section 690.63(h)—Payment From Two 

Scheduled Awards 

Under the final regulations in 

§ 690.63(h), if a student is eligible for 

the remaining portion of a first 

Scheduled Award in an award year and 

for a payment from the second 

Scheduled Award, the student’s 

payment would be calculated using the 

annual award for his or her enrollment 

status for the payment period. The 

student’s payment would be the 

remaining amount of the first Scheduled 

Award being completed plus an amount 

from the second Scheduled Award in 


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55930 Federal Register / Vol. 74, No. 208 / Thursday, October 29, 2009 / Rules and Regulations 

the award year up to the total amount 

of the payment for the payment period. 

We estimate that the final regulations 

will increase burden for institutions by 

8,471 hours in OMB Control Number 

1845–NEW5. 

Part 692 Leveraging Educational 

Assistance Partnership Program 

Section 692.21(k)—Notification to 

Students of LEAP Grant Funding 

Sources 

The final regulations require that the 

State program notify eligible students 

that grants under the LEAP Grant 

Program are (1) LEAP Grants and (2) 

funded by the Federal Government, the 

State, and, where applicable, other 

contributing partners. 

The implementation of the final 

regulations for the changes to LEAP and 

the introduction of the GAP program 

will increase burden to States. We 

estimate that the burden in these final 

regulations will be associated with the 

application and performance report 

forms under development. These forms 

will be developed after the final 

regulations are published to ensure that 

the forms comport with the finalized 

requirements. The new forms will be 

submitted to OMB for approval under 

OMB Control Number 1845–NEW7. 

Section 692.100—Requirements a State 

Must Meet To Receive GAP Funds 

The final regulations in § 692.100 

describe the requirements that a State 

must meet to receive an allotment under 

this program including submitting an 

application on behalf of a partnership 

and serving as the primary 

administrative unit of the partnership. 

Under § 692.100(a)(6), a State must 

include in its application the steps it 

plans to take to ensure, to the extent 

practicable, that students who receive a 

LEAP Grant under GAP would persist to 

degree completion. 

Under § 692.100(a)(8) a State GAP 

Program is required to notify eligible 

students that the grants they receive 

under GAP are LEAP Grants and that 

the grants are funded by the Federal 

Government, the State and where 

applicable, other contributing partners. 

The implementation of the final 

regulations for the changes to LEAP and 

the introduction of the GAP program 

will increase burden to States. We 

estimate that the burden in these final 

regulations will be associated with the 

application and performance report 

forms under development. These forms 

will be developed after the final 

regulations are published to ensure that 

the forms comport with the finalized 

requirements. The new forms will be 

submitted to OMB for approval under 

OMB Control Number 1845–NEW7. 

Section 692.101—Requirements That 

Must Be Met by a State Partnership 

The final regulations in 

§ 692.101(b)(2) provide that a degreegranting institution of higher education 

that is in a partnership under the GAP 

Program must recruit, admit, and 

provide institutional grant aid to 

participating eligible students as agreed 

to with the State agency. 

The implementation of the final 

regulations for the changes to LEAP and 

the introduction of the GAP program 

will increase burden to States. We 

estimate that the burden in these final 

regulations will be associated with the 

application and performance report 

forms under development. These forms 

will be developed after the final 

regulations are published to ensure that 

the forms comport with the finalized 

requirements. The new forms will be 

submitted to OMB for approval under 

OMB Control Number 1845–NEW7. 

Section 692.111—Purposes for Which a 

State May Use Its GAP Grant 

The final regulations in § 692.111 

provide that each State receiving an 

allotment shall annually notify 

potentially eligible students in grades 7 

through 12 in the State, and their 

families, of their potential eligibility for 

student financial assistance, including a 

LEAP Grant under GAP, to attend a 

LEAP-participating institution of higher 

education. 

The notice shall include information 

about early information and 

intervention, mentoring, or outreach 

programs available to the student. The 

notice shall provide a nonbinding 

estimate of the total amount of financial 

aid that an eligible student with a 

similar income level may expect to 

receive, including an estimate of the 

amount of a LEAP Grant under GAP and 

an estimate of the amount of grants, 

loans, and all other available types of 

aid from the major Federal and State 

financial aid programs. The final notice 

will also include any additional 

requirements that the State may require 

for receipt of a LEAP Grant under GAP. 

The implementation of the final 

regulations for the changes to LEAP and 

the introduction of the GAP program 

will increase burden to States. We 

estimate that the burden in these final 

regulations will be associated with the 

application and performance report 

forms under development. These forms 

will be developed after the final 

regulations are published to ensure that 

the forms comport with the finalized 

requirements. The new forms will be 

submitted to OMB for approval under 

OMB Control Number 1845–NEW7. 

Consistent with this discussion, the 

following chart describes the sections of 

the final regulations involving 

information collections, the information 

being collected, and the collections that 

the Department will submit to the Office 

of Management and Budget for approval 

and public comment under the 

Paperwork and Reduction Act. 

Regulatory section Information section Collection 

668.14(b)(31) ....................... Providing that an institution that conducts a teach-out at 

a site of a closed institution may, under certain conditions, establish that site as an additional location (see 

sections 487(f) and 498 of the HEA).

OMB 1845–0022. There will be an increase in burden 

of 160 hours. 

668.18 .................................. Establishing requirements under which an institution 

must readmit servicemembers to the same academic 

status they had when they last attended the institution (see section 484C of the HEA).

OMB 1845–NEW1. There will be a new collection. A 

separate 60-day Federal Register notice will be published to solicit comments. There will be an increase 

in burden of 1,513 hours. 

668.23(d)(4) ......................... Adds new requirements to include in the audited financial statement footnote the non-Federal and Federal 

revenue that was included in the 90/10 calculation.

OMB 1845–0038. There will be an increase in burden 

of 165 hours. 

668.28 .................................. Establishing new requirements for determining how proprietary institutions calculate the amount and percent 

of revenue derived from sources other than Title IV, 

HEA program funds (see section 487(d) of the HEA).

OMB 1845–NEW2. There will be a new collection. A 

separate 60-day Federal Register notice will be published to solicit comments. There will be an increase 

in burden of 3,088 hours. 


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Federal Register / Vol. 74, No. 208 / Thursday, October 29, 2009 / Rules and Regulations 55931 

Regulatory section Information section Collection 

668.43(a)(5)(iv) .................... Expanding the information that an institution must make 

available to prospective and enrolled students to include a description of any plans the institution has to 

improve its academic program (see section 485(a) of 

the HEA).

OMB 1845–0022. There will be an increase in burden 

of 968 hours. 

668.14(b)(30), 668.43(a)(10) Providing that an institution must certify that it has 

plans to effectively combat unauthorized distribution 

of copyrighted material and will offer alternatives to illegal downloading or peer-to-peer distribution of intellectual property (see sections 485(a)(1) and 487(a) of 

the HEA).

OMB 1845–0022. There will be an increase in burden 

of 92,544 hours. 

668.41 .................................. Expanding the information that institutions must make 

available to prospective and enrolled students to include information on: the employment and placement 

of students, and the retention rates of first-time, fulltime undergraduate students.

OMB 1845–0004. There will be an increase in burden 

of 8,541 hours. 

668.45 .................................. Expanding the information that institutions must make 

available to prospective students to include completion and graduation rate data that is disaggregated 

by gender, race, and grant or loan assistance (see 

section 485(a) of the HEA).

OMB 1845–0004. There will be an increase in burden 

of 7,488 hours. 

668.46(c)(3), (e), (g) ............ Expanding the list of crimes that institutions must include in the hate crimes statistics reported to the Department. Requiring institutions to include in the annual security report a statement of emergency response and evacuation procedures (see section 

485(f) of the HEA).

OMB 1845–0022. There will be an increase in burden 

of 18,509 hours. 

668.41(a) .............................. Requiring institutions that provide on-campus housing 

facilities to develop and make available a missing 

student notification policy and allow students who reside on campus to confidentially register contact information (see section 485(j) of the HEA).

OMB 1845–0004. There is no change in burden associated with this section of the final regulations. 

668.46(b), (h) ....................... Requiring institutions that provide on-campus housing 

facilities to develop and make available a missing 

student notification policy and allow students who reside on campus to confidentially register contact information (see section 485(j) of the HEA).

OMB 1845–0022. There will be an increase in burden 

of 2,879 hours. 

668.41(e) .............................. Establishing requirements for institutions that maintain 

on-campus housing facilities to publish annually a fire 

safety report, maintain a fire log, and report fire statistics to the Department (see section 485(i) of the 

HEA).

OMB 1845–0004. There is no change in burden associated with this section of the final regulations. 

668.49 .................................. Establishing requirements for institutions that maintain 

on-campus housing facilities to publish annually a fire 

safety report, maintain a fire log, and report fire statistics to the Department (see section 485(i) of the 

HEA).

OMB 1845–NEW3. There will be a new collection. A 

separate 60-day Federal Register notice will be published to solicit comments. There will be an increase 

in burden of 7,283 hours. 

668.232 ................................ Expanding the eligibility for Federal Pell Grant, FWS, 

and FSEOG Program funds to students with intellectual disabilities (see sections 484(s) and 760 of the 

HEA).

OMB 1845–NEW4. There will be a new collection. A 

separate 60-day Federal Register notice will be published to solicit comments. There will be an increase 

in burden of 66 hours. 

668.233 ................................ Expanding the eligibility for Federal Pell Grant, FWS, 

and FSEOG Program funds to students with intellectual disabilities (see sections 484(s) and 760 of the 

HEA).

OMB 1845–NEW4. There will be a new collection. A 

separate 60-day Federal Register notice will be published to solicit comments. There will be an increase 

in burden of 768 hours. 

688.43(a)(7) ......................... Requires that institutions report a description of services and facilities for student with intellectual disabilities.OMB 1845–0022. There will be an increase in burden 

of 44 hours. 

686.41, 686.42 ..................... Establishing extenuating circumstances under which a 

TEACH Grant recipient may be excused from fulfilling 

all or part of his or her service obligation (see section 

420N(d)(2) of the HEA).

OMB 1845–0083. Changes will be incorporated into the 

Agreement to Serve form. 

690.67, 690.64, 690.63(h) ... Establishing requirements under which students may 

receive up to two Federal Pell Grant Scheduled 

Awards during a single award year (see section 

401(b)(5)(A) of the HEA).

OMB 1845–NEW5. There will be a new collection. A 

separate 60-day Federal Register notice will be published to solicit comments. There will be an increase 

in burden of 109,645 hours. 


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55932 Federal Register / Vol. 74, No. 208 / Thursday, October 29, 2009 / Rules and Regulations 

Regulatory section Information section Collection 

692.21, 692.100, 692.101, 

692.111.

Requiring the State program to notify students that 

grants are LEAP Grants that are funded by the Federal Government, the State, and for LEAP Grants to 

students under the new Grants for Access and Persistence (GAP) Program, other contributing partners 

(see section 415C(b) of the HEA). Establishing the 

activities, awards, allotments to States, matching 

funds requirements, consumer information requirements, application requirements, and other requirements needed to begin and continue participating in 

the GAP Program (see sections 415B and 415E of 

the HEA).

OMB 1845–NEW6. There will be a new collection. A 

separate 60-day Federal Register notice will be published to solicit comments. 

Electronic Access to This Document 

You may view this document, as well 

as all other Department of Education 

documents published in the Federal 

Register, in text or Adobe Portable 

Document Format (PDF) on the Internet 

at the following site: http://www.ed.gov/ 

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To use PDF you must have Adobe 

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at this site. If you have questions about 

using PDF, call the U.S. Government 

Printing Office (GPO), toll free, at 1– 

888–293–6498; or in the Washington, 

DC, area at (202) 512–1530. 

Note: The official version of this document 

is the document published in the Federal 

Register. Free Internet access to the official 

edition of the Federal Register and the Code 

of Federal Regulations is available on GPO 

Access at: http://www.gpoaccess.gov/nara/ 

index.html. 

(Catalog of Federal Domestic Assistance 

Numbers: 84.063 Federal Pell Grant Program; 

84.033 Federal Work-Study Program; 84.379 

TEACH Grant Program; 84.069 LEAP) 

List of Subjects 

34 CFR Part 600 

Colleges and universities, Foreign 

relations, Grant programs—education, 

Loan programs—education, Reporting 

and recordkeeping requirements, 

Student aid, Vocational education. 

34 CFR Part 668 

Administrative practice and 

procedure, Aliens, Colleges and 

universities, Consumer protection, 

Grant programs—education, Loan 

programs—education, Reporting and 

recordkeeping requirements, Selective 

Service System, Student aid, Vocational 

education. 

34 CFR Part 675 

Colleges and universities, 

Employment, Grant programs— 

education, Reporting and recordkeeping 

requirements, Student aid. 

34 CFR Part 686 

Administrative practice and 

procedure, Colleges and universities, 

Education, Elementary and secondary 

education, Grant programs—education, 

Reporting and recordkeeping 

requirements, Student aid. 

34 CFR Part 690 

Colleges and universities, Education 

of disadvantaged, Grant programs— 

education, Reporting and recordkeeping 

requirements, Student aid. 

34 CFR Part 692 

Colleges and universities, Grant 

programs—education, Reporting and 

recordkeeping requirements, Student 

aid. 

Dated: October 16, 2009. 

Arne Duncan, 

Secretary of Education. 

■ For the reasons discussed in the 

preamble, the Secretary amends parts 

600, 668, 675, 686, 690, and 692 of title 

34 of the Code of Federal Regulations as 

follows: 

PART 600—INSTITUTIONAL 

ELIGIBILITY UNDER THE HIGHER 

EDUCATION ACT OF 1965, AS 

AMENDED 

■ 1. The authority citation for part 600 

continues to read as follows: 

Authority: : 20 U.S.C. 1001, 1002, 1003, 

1088, 1091, 1094, 1099b, and 1099c, unless 

otherwise noted. 

■ 2. Section 600.2 is amended by: 

■ A. Revising paragraph (1)(i) of the 

definition of educational program. 

■ B. Adding, in alphabetical order, a 

definition for teach-out plan. 

■ C. Revising the authority citation at 

the end of the section. 

The revisions and addition read as 

follows: 

§ 600.2 Definitions. 

* * * * * 

Educational program: (1) * * * 

(i) Leads to an academic, professional, 

or vocational degree, or certificate, or 

other recognized educational credential, 

or is a comprehensive transition and 

postsecondary program, as described in 

34 CFR part 668, subpart O; and 

* * * * * 

Teach-out plan: A written plan 

developed by an institution that 

provides for the equitable treatment of 

students if an institution, or an 

institutional location that provides 100 

percent of at least one program, ceases 

to operate before all students have 

completed their program of study, and 

may include, if required by the 

institution’s accrediting agency, a teachout agreement between institutions. 

* * * * * 

(Authority: 20 U.S.C. 1071, et seq., 1078–2, 

1088, 1091, 1094, 1099b, 1099c, 1141; 26 

U.S.C. 501(c)) 

■ 3. Section 600.4 is amended by: 

■ A. Revising paragraph (a)(4). 

■ B. Revising the authority citation at 

the end of the section. 

The revisions read as follows: 

§ 600.4 Institution of higher education. 

(a) * * * 

(4)(i) Provides an educational 

program— 

(A) For which it awards an associate, 

baccalaureate, graduate, or professional 

degree; 

(B) That is at least a two-academicyear program acceptable for full credit 

toward a baccalaureate degree; or 

(C) That is at least a one-academicyear training program that leads to a 

certificate, degree, or other recognized 

educational credential and prepares 

students for gainful employment in a 

recognized occupation; and 

(ii) May provide a comprehensive 

transition and postsecondary program, 

as described in 34 CFR part 668, subpart 

O; and 

* * * * * 

(Authority: 20 U.S.C. 1091, 1094, 1099b, 

1141(a)) 

■ 4. Section 600.5 is amended by: 

■ A. Revising paragraph (a)(5). 

■ B. In paragraph (a)(6), adding the 

word ‘‘and’’ after the punctuation ‘‘;’’. 


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■ C. In paragraph (a)(7), removing the 

word ‘‘; and’’ and adding, in its place, 

the punctuation ‘‘.’’. 

■ D. Removing paragraph (a)(8). 

■ E. Removing paragraphs (d) through 

(g). 

■ F. Redesignating paragraph (h) as 

paragraph (d). 

■ G. Adding a new paragraph (e). 

■ H. Revising the OMB control number 

and authority citation at the end of the 

section. 

The revisions and addition read as 

follows: 

§ 600.5 Proprietary institution of higher 

education. 

(a) * * * 

(5)(i)(A) Provides an eligible program 

of training, as defined in 34 CFR 668.8, 

to prepare students for gainful 

employment in a recognized 

occupation; or 

(B)(1) Has provided a program leading 

to a baccalaureate degree in liberal arts, 

as defined in paragraph (e) of this 

section, continuously since January 1, 

2009; and 

(2) Is accredited by a recognized 

regional accrediting agency or 

association, and has continuously held 

such accreditation since October 1, 

2007, or earlier; and 

(ii) May provide a comprehensive 

transition and postsecondary program 

for students with intellectual 

disabilities, as provided in 34 CFR part 

668, subpart O; 

* * * * * 

(e) For purposes of this section, a 

‘‘program leading to a baccalaureate 

degree in liberal arts’’ is a program that 

the institution’s recognized regional 

accreditation agency or organization 

determines, is a general instructional 

program in the liberal arts subjects, the 

humanities disciplines, or the general 

curriculum, falling within one or more 

of the following generally-accepted 

instructional categories comprising such 

programs, but including only 

instruction in regular programs, and 

excluding independently-designed 

programs, individualized programs, and 

unstructured studies: 

(1) A program that is a structured 

combination of the arts, biological and 

physical sciences, social sciences, and 

humanities, emphasizing breadth of 

study. 

(2) An undifferentiated program that 

includes instruction in the general arts 

or general science. 

(3) A program that focuses on 

combined studies and research in the 

humanities subjects as distinguished 

from the social and physical sciences, 

emphasizing languages, literatures, art, 

music, philosophy, and religion. 

(4) Any single instructional program 

in liberal arts and sciences, general 

studies, and humanities not listed in 

paragraph (e)(1) through (e)(3) of this 

section. 

(Approved by the Office of Management and 

Budget under control number 1845–0012) 

(Authority: 20 U.S.C. 1088, 1091) 

■ 5. Section 600.6 is amended by: 

■ A. Revising paragraph (a)(4). 

■ B. Revising the authority citation at 

the end of the section. 

The revisions read as follows: 

§ 600.6 Postsecondary vocational 

institution. 

(a) * * * 

(4)(i) Provides an eligible program of 

training, as defined in 34 CFR 668.8, to 

prepare students for gainful 

employment in a recognized 

occupation; and 

(ii) May provide a comprehensive 

transition and postsecondary program 

for students with intellectual 

disabilities, as provided in 34 CFR part 

668, subpart O; 

* * * * * 

(Authority: 20 U.S.C. 1088, 1091, 1094(c)(3)) 

■ 6. Section 600.32 is amended by: 

■ A. In paragraph (a), removing the 

words ‘‘(b) and (c)’’ and adding, in their 

place, the words ‘‘(b), (c), and (d)’’. 

■ B. Redesignating paragraph (d) as 

paragraph (e). 

■ C. Adding a new paragraph (d). 

■ D. Revising the authority citation at 

the end of the section. 

The addition and revision read as 

follows: 

§ 600.32 Eligibility of additional locations. 

* * * * * 

(d)(1) An institution that conducts a 

teach-out at a site of a closed institution 

may apply to have that site approved as 

an additional location if— 

(i) The closed institution ceased 

operations and the Secretary has taken 

an action to limit, suspend, or terminate 

the institution’s participation under 

§ 600.41 or subpart G of this part, or has 

taken an emergency action under 34 

CFR 668.83; and 

(ii) The teach-out plan required under 

34 CFR 668.14(b)(31) is approved by the 

closed institution’s accrediting agency. 

(2)(i) An institution that conducts a 

teach-out and is approved to add an 

additional location described in 

paragraph (d)(1) of this section— 

(A) Does not have to meet the twoyear in existence requirement of 

§ 600.5(a)(7) or § 600.6(a)(6) for the 

additional location described in 

paragraph (d)(1) of this section; 

(B) Is not responsible for any 

liabilities of the closed institution as 

provided under paragraph (c)(1) and 

(c)(2) of this section if the institutions 

are not related parties and there is no 

commonality of ownership or 

management between the institutions, 

as described in 34 CFR 668.188(b) and 

34 CFR 668.207(b); and 

(C) Will not have the default rate of 

the closed institution included in the 

calculation of its default rate, as would 

otherwise be required under 34 CFR 

668.184 and 34 CFR 668.203, if the 

institutions are not related parties and 

there is no commonality of ownership 

or management between the 

institutions, as described in 34 CFR 

668.188(b) and 34 CFR 668.207(b). 

(ii) As a condition for approving an 

additional location under paragraph 

(d)(1) of this section, the Secretary may 

require that payments from the 

institution conducting the teach-out to 

the owners or related parties of the 

closed institution, are used to satisfy 

any liabilities owed by the closed 

institution. 

* * * * * 

(Authority: 20 U.S.C. 1088, 1099c, 1141) 

PART 668—STUDENT ASSISTANCE 

GENERAL PROVISIONS 

■ 7. The authority citation for part 668 

continues to read as follows: 

Authority: : 20 U.S.C. 1001, 1002, 1003, 

1070g, 1085, 1088, 1091, 1092, 1094, 1099c, 

and 1099c–1, unless otherwise noted. 

■ 8. Section 668.8 is amended by: 

■ A. In paragraph (d)(2)(iv)(B), removing 

the word ‘‘or’’ that appears after the 

punctuation ‘‘;’’. 

■ B. In paragraph (d)(3)(v), removing the 

punctuation ‘‘.’’ and adding, in its place, 

the word ‘‘; or’’. 

■ C. Adding paragraph (d)(4). 

■ D. Revising paragraph (n). 

■ E. Removing the OMB control number 

at the end of the section. 

The addition and revision read as 

follows: 

§ 668.8 Eligible program. 

(d) * * * 

(4) For purposes of a proprietary 

institution of higher education only, is 

a program leading to a baccalaureate 

degree in liberal arts, as defined in 34 

CFR 600.5(e), that— 

(i) Is provided by an institution that 

is accredited by a recognized regional 

accrediting agency or association, and 

has continuously held such 

accreditation since October 1, 2007, or 

earlier; and 

(ii) The institution has provided 

continuously since January 1, 2009. 

* * * * * 

(n) For Title IV, HEA program 

purposes, eligible program includes a 


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direct assessment program approved by 

the Secretary under § 668.10 and a 

comprehensive transition and 

postsecondary program approved by the 

Secretary under § 668.232. 

* * * * * 

■ 9. Section 668.13(c)(1) is revised to 

read as follows: 

§ 668.13 Certification procedures. 

* * * * * 

(c) Provisional certification. (1)(i) The 

Secretary may provisionally certify an 

institution if— 

(A) The institution seeks initial 

participation in a Title IV, HEA 

program; 

(B) The institution is an eligible 

institution that has undergone a change 

in ownership that results in a change in 

control according to the provisions of 34 

CFR part 600; 

(C) The institution is a participating 

institution— 

(1) That is applying for a certification 

that the institution meets the standards 

of this subpart; 

(2) That the Secretary determines has 

jeopardized its ability to perform its 

financial responsibilities by not meeting 

the factors of financial responsibility 

under § 668.15 and subpart L of this part 

or the standards of administrative 

capability under § 668.16; and 

(3) Whose participation has been 

limited or suspended under subpart G of 

this part, or voluntarily enters into 

provisional certification; 

(D) The institution seeks a renewal of 

participation in a Title IV, HEA program 

after the expiration of a prior period of 

participation in that program; or 

(E) The institution is a participating 

institution that was accredited or 

preaccredited by a nationally recognized 

accrediting agency on the day before the 

Secretary withdrew the Secretary’s 

recognition of that agency according to 

the provisions contained in 34 CFR part 

603. 

(ii) A proprietary institution’s 

certification automatically becomes 

provisional at the start of a fiscal year 

after it did not derive at least 10 percent 

of its revenue for its preceding fiscal 

year from sources other than Title IV, 

HEA program funds, as required under 

§ 668.14(b)(16). 

* * * * * 

■ 10. Section 668.14 is amended by: 

■ A. Adding paragraph (b)(16). 

■ B. In paragraph (b)(25)(ii), removing 

the word ‘‘and’’ that appears after the 

punctuation ‘‘;’’. 

■ C. Adding paragraph (b)(30). 

■ D. Adding paragraph (b)(31). 

■ E. Revising the OMB control number 

at the end of the section. 

The additions and revision read as 

follows: 

§ 668.14 Program participation agreement. 

* * * * * 

(b) * * * 

(16) For a proprietary institution, the 

institution will derive at least 10 

percent of its revenues for each fiscal 

year from sources other than Title IV, 

HEA program funds, as provided in 

§ 668.28(a) and (b), or be subject to 

sanctions described in § 668.28(c); 

* * * * * 

(30) The institution— 

(i) Has developed and implemented 

written plans to effectively combat the 

unauthorized distribution of 

copyrighted material by users of the 

institution’s network, without unduly 

interfering with educational and 

research use of the network, that 

include— 

(A) The use of one or more 

technology-based deterrents; 

(B) Mechanisms for educating and 

informing its community about 

appropriate versus inappropriate use of 

copyrighted material, including that 

described in § 668.43(a)(10); 

(C) Procedures for handling 

unauthorized distribution of 

copyrighted material, including 

disciplinary procedures; and 

(D) Procedures for periodically 

reviewing the effectiveness of the plans 

to combat the unauthorized distribution 

of copyrighted materials by users of the 

institution’s network using relevant 

assessment criteria. No particular 

technology measures are favored or 

required for inclusion in an institution’s 

plans, and each institution retains the 

authority to determine what its 

particular plans for compliance with 

paragraph (b)(30) of this section will be, 

including those that prohibit content 

monitoring; and 

(ii) Will, in consultation with the 

chief technology officer or other 

designated officer of the institution— 

(A) Periodically review the legal 

alternatives for downloading or 

otherwise acquiring copyrighted 

material; 

(B) Make available the results of the 

review in paragraph (b)(30)(ii)(A) of this 

section to its students through a Web 

site or other means; and 

(C) To the extent practicable, offer 

legal alternatives for downloading or 

otherwise acquiring copyrighted 

material, as determined by the 

institution; and 

(31) The institution will submit a 

teach-out plan to its accrediting agency 

in compliance with 34 CFR 602.24(c), 

and the standards of the institution’s 

accrediting agency upon the occurrence 

of any of the following events: 

(i) The Secretary initiates the 

limitation, suspension, or termination of 

the participation of an institution in any 

Title IV, HEA program under 34 CFR 

600.41 or subpart G of this part or 

initiates an emergency action under 

§ 668.83. 

(ii) The institution’s accrediting 

agency acts to withdraw, terminate, or 

suspend the accreditation or 

preaccreditation of the institution. 

(iii) The institution’s State licensing 

or authorizing agency revokes the 

institution’s license or legal 

authorization to provide an educational 

program. 

(iv) The institution intends to close a 

location that provides 100 percent of at 

least one program. 

(v) The institution otherwise intends 

to cease operations. 

* * * * * 

(Approved by the Office of Management and 

Budget under control number 1845–0022) 

* * * * * 

■ 11. Section 668.18 is added to subpart 

B of part 668 to read as follows: 

§ 668.18 Readmission requirements for 

servicemembers. 

(a) General. (1) An institution may not 

deny readmission to a person who is a 

member of, applies to be a member of, 

performs, has performed, applies to 

perform, or has an obligation to perform, 

service in the uniformed services on the 

basis of that membership, application 

for membership, performance of service, 

application for service, or obligation to 

perform service. 

(2)(i) An institution must promptly 

readmit to the institution a person 

described in paragraph (a)(1) of this 

section with the same academic status 

as the student had when the student last 

attended the institution or was last 

admitted to the institution, but did not 

begin attendance because of that 

membership, application for 

membership, performance of service, 

application for service, or obligation to 

perform service. 

(ii) ‘‘Promptly readmit’’ means that 

the institution must readmit the student 

into the next class or classes in the 

student’s program beginning after the 

student provides notice of his or her 

intent to reenroll, unless the student 

requests a later date of readmission or 

unusual circumstances require the 

institution to admit the student at a later 

date. 

(iii) To readmit a person with the 

‘‘same academic status’’ means that the 

institution admits the student— 

(A) To the same program to which he 

or she was last admitted by the 


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institution or, if that exact program is no 

longer offered, the program that is most 

similar to that program, unless the 

student requests or agrees to admission 

to a different program; 

(B) At the same enrollment status that 

the student last held at the institution, 

unless the student requests or agrees to 

admission at a different enrollment 

status; 

(C) With the same number of credit 

hours or clock hours completed 

previously by the student, unless the 

student is readmitted to a different 

program to which the completed credit 

hours or clock hours are not 

transferable; 

(D) With the same academic standing 

(e.g., with the same satisfactory 

academic progress status) the student 

previously had; and 

(E)(1) If the student is readmitted to 

the same program, for the first academic 

year in which the student returns, 

assessing— 

(i) The tuition and fee charges that the 

student was or would have been 

assessed for the academic year during 

which the student left the institution; or 

(ii) Up to the amount of tuition and 

fee charges that other students in the 

program are assessed for that academic 

year, if veterans’ education benefits, as 

defined in section 480(c) of the HEA, or 

other servicemember education benefits, 

will pay the amount in excess of the 

tuition and fee charges assessed for the 

academic year in which the student left 

the institution; or 

(2) If the student is admitted to a 

different program, and for subsequent 

academic years for a student admitted to 

the same program, assessing no more 

than the tuition and fee charges that 

other students in the program are 

assessed for that academic year. 

(iv)(A) If the institution determines 

that the student is not prepared to 

resume the program with the same 

academic status at the point where the 

student left off, or will not be able to 

complete the program, the institution 

must make reasonable efforts at no extra 

cost to the student to help the student 

become prepared or to enable the 

student to complete the program 

including, but not limited to, providing 

refresher courses at no extra cost to the 

student and allowing the student to 

retake a pretest at no extra cost to the 

student. 

(B) The institution is not required to 

readmit the student on his or her return 

if— 

(1) After reasonable efforts by the 

institution, the institution determines 

that the student is not prepared to 

resume the program at the point where 

he or she left off; 

(2) After reasonable efforts by the 

institution, the institution determines 

that the student is unable to complete 

the program; or 

(3) The institution determines that 

there are no reasonable efforts the 

institution can take to prepare the 

student to resume the program at the 

point where he or she left off or to 

enable the student to complete the 

program. 

(C)(1) ‘‘Reasonable efforts’’ means 

actions that do not place an undue 

hardship on the institution. 

(2) ‘‘Undue hardship’’ means an 

action requiring significant difficulty or 

expense when considered in light of the 

overall financial resources of the 

institution and the impact otherwise of 

such action on the operation of the 

institution. 

(D) The institution carries the burden 

to prove by a preponderance of the 

evidence that the student is not 

prepared to resume the program with 

the same academic status at the point 

where the student left off, or that the 

student will not be able to complete the 

program. 

(3) This section applies to an 

institution that has continued in 

operation since the student ceased 

attending or was last admitted to the 

institution but did not begin attendance, 

notwithstanding any changes of 

ownership of the institution since the 

student ceased attendance. 

(4) The requirements of this section 

supersede any State law (including any 

local law or ordinance), contract, 

agreement, policy, plan, practice, or 

other matter that reduces, limits, or 

eliminates in any manner any right or 

benefit provided by this section for the 

period of enrollment during which the 

student resumes attendance, and 

continuing so long as the institution is 

unable to comply with such 

requirements through other means. 

(b) Service in the uniformed services. 

For purposes of this section, service in 

the uniformed services means service, 

whether voluntary or involuntary, in the 

Armed Forces, including service by a 

member of the National Guard or 

Reserve, on active duty, active duty for 

training, or full-time National Guard 

duty under Federal authority, for a 

period of more than 30 consecutive days 

under a call or order to active duty of 

more than 30 consecutive days. 

(c) Readmission procedures. (1) Any 

student whose absence from an 

institution is necessitated by reason of 

service in the uniformed services shall 

be entitled to readmission to the 

institution if— 

(i) Except as provided in paragraph 

(d) of this section, the student (or an 

appropriate officer of the Armed Forces 

or official of the Department of Defense) 

gives advance oral or written notice of 

such service to an office designated by 

the institution, and provides such notice 

as far in advance as is reasonable under 

the circumstances; 

(ii) The cumulative length of the 

absence and of all previous absences 

from that institution by reason of service 

in the uniformed services, including 

only the time the student spends 

actually performing service in the 

uniformed services, does not exceed five 

years; and 

(iii) Except as provided in paragraph 

(f) of this section, the student gives oral 

or written notice of his or her intent to 

return to an office designated by the 

institution— 

(A) For a student who completes a 

period of service in the uniformed 

services, not later than three years after 

the completion of the period of service; 

or 

(B) For a student who is hospitalized 

for or convalescing from an illness or 

injury incurred in or aggravated during 

the performance of service in the 

uniformed services, not later than two 

years after the end of the period that is 

necessary for recovery from such illness 

or injury. 

(2)(i) An institution must designate 

one or more offices at the institution 

that a student may contact to provide 

notification of service required by 

paragraph (c)(1)(i) of this section and 

notification of intent to return required 

by paragraph (c)(1)(iii) of this section. 

(ii) An institution may not require 

that the notice provided by the student 

under paragraph (c)(1)(i) or (c)(1)(iii) of 

this section follow any particular 

format. 

(iii) The notice provided by the 

student under paragraph (c)(1)(i) of this 

section— 

(A) May not be subject to any rule for 

timeliness; timeliness must be 

determined by the facts in any 

particular case; and 

(B) Does not need to indicate whether 

the student intends to return to the 

institution. 

(iv) For purposes of paragraph (c)(1)(i) 

of this section, an ‘‘appropriate officer’’ 

is a commissioned, warrant, or 

noncommissioned officer authorized to 

give such notice by the military service 

concerned. 

(d) Exceptions to advance notice. (1) 

No notice is required under paragraph 

(c)(1)(i) of this section if the giving of 

such notice is precluded by military 

necessity, such as— 

(i) A mission, operation, exercise, or 

requirement that is classified; or 


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(ii) A pending or ongoing mission, 

operation, exercise, or requirement that 

may be compromised or otherwise 

adversely affected by public knowledge. 

(2) Any student (or an appropriate 

officer of the Armed Forces or official of 

the Department of Defense) who did not 

give advance written or oral notice of 

service to the appropriate official at the 

institution in accordance with 

paragraph (c)(1) of this section may 

meet the notice requirement by 

submitting, at the time the student seeks 

readmission, an attestation to the 

institution that the student performed 

service in the uniformed services that 

necessitated the student’s absence from 

the institution. 

(e) Cumulative length of absence. For 

purposes of paragraph (c)(1)(ii) of this 

section, a student’s cumulative length of 

absence from an institution does not 

include any service— 

(1) That is required, beyond five 

years, to complete an initial period of 

obligated service; 

(2) During which the student was 

unable to obtain orders releasing the 

student from a period of service in the 

uniformed services before the expiration 

of the five-year period and such 

inability was through no fault of the 

student; or 

(3) Performed by a member of the 

Armed Forces (including the National 

Guard and Reserves) who is— 

(i) Ordered to or retained on active 

duty under— 

(A) 10 U.S.C. 688 (involuntary active 

duty by a military retiree); 

(B) 10 U.S.C. 12301(a) (involuntary 

active duty in wartime); 

(C) 10 U.S.C. 12301(g) (retention on 

active duty while in captive status); 

(D) 10 U.S.C. 12302 (involuntary 

active duty during a national emergency 

for up to 24 months); 

(E) 10 U.S.C. 12304 (involuntary 

active duty for an operational mission 

for up to 270 days); 

(F) 10 U.S.C. 12305 (involuntary 

retention on active duty of a critical 

person during time of crisis or other 

specific conditions); 

(G) 14 U.S.C. 331 (involuntary active 

duty by retired Coast Guard officer); 

(H) 14 U.S.C. 332 (voluntary active 

duty by retired Coast Guard officer); 

(I) 14 U.S.C. 359 (involuntary active 

duty by retired Coast Guard enlisted 

member); 

(J) 14 U.S.C. 360 (voluntary active 

duty by retired Coast Guard enlisted 

member); 

(K) 14 U.S.C. 367 (involuntary 

retention of Coast Guard enlisted 

member on active duty); or 

(L) 14 U.S.C. 712 (involuntary active 

duty by Coast Guard Reserve member 

for natural or man-made disasters); 

(ii) Ordered to or retained on active 

duty (other than for training) under any 

provision of law because of a war or 

national emergency declared by the 

President or the Congress, as 

determined by the Secretary concerned; 

(iii) Ordered to active duty (other than 

for training) in support, as determined 

by the Secretary concerned, of an 

operational mission for which personnel 

have been ordered to active duty under 

section 12304 of title 10, United States 

Code; 

(iv) Ordered to active duty in support, 

as determined by the Secretary 

concerned, of a critical mission or 

requirement of the Armed Forces 

(including the National Guard or 

Reserve); or 

(v) Called into Federal service as a 

member of the National Guard under 

chapter 15 of title 10, United States 

Code, or section 12406 of title 10, 

United States Code (i.e., called to 

respond to an invasion, danger of 

invasion, rebellion, danger of rebellion, 

insurrection, or the inability of the 

President with regular forces to execute 

the laws of the United States). 

(f) Notification of intent to reenroll. A 

student who fails to apply for 

readmission within the periods 

described in paragraph (c)(1)(iii) of this 

section does not automatically forfeit 

eligibility for readmission to the 

institution, but is subject to the 

institution’s established leave of 

absence policy and general practices. 

(g) Documentation. (1) A student who 

submits an application for readmission 

to an institution under paragraph 

(c)(1)(iii) of this section shall provide to 

the institution documentation to 

establish that— 

(i) The student has not exceeded the 

service limitation in paragraph (c)(1)(ii) 

of this section; and 

(ii) The student’s eligibility for 

readmission has not been terminated 

due to an exception in paragraph (h) of 

this section. 

(2)(i) Documents that satisfy the 

requirements of paragraph (g)(1) of this 

section include, but are not limited to, 

the following: 

(A) DD (Department of Defense) 214 

Certificate of Release or Discharge from 

Active Duty. 

(B) Copy of duty orders prepared by 

the facility where the orders were 

fulfilled carrying an endorsement 

indicating completion of the described 

service. 

(C) Letter from the commanding 

officer of a Personnel Support Activity 

or someone of comparable authority. 

(D) Certificate of completion from 

military training school. 

(E) Discharge certificate showing 

character of service. 

(F) Copy of extracts from payroll 

documents showing periods of service. 

(G) Letter from National Disaster 

Medical System (NDMS) Team Leader 

or Administrative Officer verifying dates 

and times of NDMS training or Federal 

activation. 

(ii) The types of documents that are 

necessary to establish eligibility for 

readmission will vary from case to case. 

Not all of these documents are available 

or necessary in every instance to 

establish readmission eligibility. 

(3) An institution may not delay or 

attempt to avoid a readmission of a 

student under this section by 

demanding documentation that does not 

exist, or is not readily available, at the 

time of readmission. 

(h) Termination of readmission 

eligibility. A student’s eligibility for 

readmission to an institution under this 

section by reason of such student’s 

service in the uniformed services 

terminates upon the occurrence of any 

of the following events: 

(1) A separation of such person from 

the Armed Forces (including the 

National Guard and Reserves) with a 

dishonorable or bad conduct discharge. 

(2) A dismissal of a commissioned 

officer permitted under section 1161(a) 

of title 10, United States Code by 

sentence of a general court-martial; in 

commutation of a sentence of a general 

court-martial; or, in time of war, by 

order of the President. 

(3) A dropping of a commissioned 

officer from the rolls pursuant to section 

1161(b) of title 10, United States Code 

due to absence without authority for at 

least three months; separation by reason 

of a sentence to confinement adjudged 

by a court-martial; or, a sentence to 

confinement in a Federal or State 

penitentiary or correctional institution. 

(Approved by the Office of Management and 

Budget under control number 1845–NEW1) 

(Authority: 20 U.S.C. 1088, et seq.) 

■ 12. Section 668.23 is amended by 

revising paragraph (d)(4) to read as 

follows: 

§ 668.23 Compliance audits and audited 

financial statements. 

* * * * * 

(d) * * * 

(4) Disclosure of Title IV, HEA 

program revenue. A proprietary 

institution must disclose in a footnote to 

its financial statement audit the 

percentage of its revenues derived from 

the Title IV, HEA program funds that 

the institution received during the fiscal 

year covered by that audit. The revenue 

percentage must be calculated in 


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accordance with § 668.28. The 

institution must also report in the 

footnote the dollar amount of the 

numerator and denominator of its 90/10 

ratio as well as the individual revenue 

amounts identified in section 2 of 

appendix C to subpart B of part 668. 

* * * * * 

■ 13. Section 668.28 is added to subpart 

B of part 668 to read as follows: 

§ 668.28 Non-title IV revenue (90/10). 

(a) General. (1) Calculating the 

revenue percentage. A proprietary 

institution meets the requirement in 

§ 668.14(b)(16) that at least 10 percent of 

its revenue is derived from sources 

other than Title IV, HEA program funds 

by using the formula in appendix C of 

this subpart to calculate its revenue 

percentage for its latest complete fiscal 

year. 

(2) Cash basis accounting. Except for 

institutional loans made to students 

under paragraph (a)(5)(i) of this section, 

the institution must use the cash basis 

of accounting in calculating its revenue 

percentage. 

(3) Revenue generated from programs 

and activities. The institution must 

consider as revenue only those funds it 

generates from— 

(i) Tuition, fees, and other 

institutional charges for students 

enrolled in eligible programs as defined 

in § 668.8; 

(ii) Activities conducted by the 

institution that are necessary for the 

education and training of its students 

provided those activities are— 

(A) Conducted on campus or at a 

facility under the institution’s control; 

(B) Performed under the supervision 

of a member of the institution’s faculty; 

and 

(C) Required to be performed by all 

students in a specific educational 

program at the institution; and 

(iii) Funds paid by a student, or on 

behalf of a student by a party other than 

the institution, for an education or 

training program that is not eligible 

under § 668.8 if the program— 

(A) Is approved or licensed by the 

appropriate State agency; 

(B) Is accredited by an accrediting 

agency recognized by the Secretary 

under 34 CFR part 602; 

(C) Provides an industry-recognized 

credential or certification, or prepares 

students to take an examination for an 

industry-recognized credential or 

certification issued by an independent 

third party; 

(D) Provides training needed for 

students to maintain State licensing 

requirements; or 

(E) Provides training needed for 

students to meet additional licensing 

requirements for specialized training for 

practitioners that already meet the 

general licensing requirements in that 

field. 

(4) Application of funds. The 

institution must presume that any Title 

IV, HEA program funds it disburses, or 

delivers, to or on behalf of a student will 

be used to pay the student’s tuition, 

fees, or institutional charges, regardless 

of whether the institution credits the 

funds to the student’s account or pays 

the funds directly to the student, except 

to the extent that the student’s tuition, 

fees, or other charges are satisfied by— 

(i) Grant funds provided by nonFederal public agencies or private 

sources independent of the institution; 

(ii) Funds provided under a 

contractual arrangement with a Federal, 

State, or local government agency for 

the purpose of providing job training to 

low-income individuals who need that 

training; 

(iii) Funds used by a student from a 

savings plan for educational expenses 

established by or on behalf of the 

student if the saving plan qualifies for 

special tax treatment under the Internal 

Revenue Code of 1986; or 

(iv) Institutional scholarships that 

meet the requirements in paragraph 

(a)(5)(iv) of this section. 

(5) Revenue generated from 

institutional aid. The institution must 

include the following institutional aid 

as revenue: 

(i) For loans made to students and 

credited in full to the students’ accounts 

at the institution on or after July 1, 2008 

and prior to July 1, 2012, include as 

revenue the net present value of the 

loans made to students during the fiscal 

year, as calculated under paragraph (b) 

of this section, if the loans— 

(A) Are bona fide as evidenced by 

standalone repayment agreements 

between the students and the institution 

that are enforceable promissory notes; 

(B) Are issued at intervals related to 

the institution’s enrollment periods; 

(C) Are subject to regular loan 

repayments and collections by the 

institution; and 

(D) Are separate from the enrollment 

contracts signed by the students. 

(ii) For loans made to students before 

July 1, 2008, include as revenue only 

the amount of payments made on those 

loans that the institution received 

during the fiscal year. 

(iii) For loans made to students on or 

after July 1, 2012, include as revenue 

only the amount of payments made on 

those loans that the institution received 

during the fiscal year. 

(iv) For scholarships provided by the 

institution in the form of monetary aid 

or tuition discount and based on the 

academic achievement or financial need 

of its students, include as revenue the 

amount disbursed to students during the 

fiscal year. The scholarships must be 

disbursed from an established restricted 

account and only to the extent that the 

funds in that account represent 

designated funds from an outside source 

or income earned on those funds. 

(6) Revenue generated from loan 

funds in excess of loan limits prior to 

the Ensuring Continued Access to 

Student Loans Act of 2008 (ECASLA). 

For each student who receives an 

unsubsidized loan under the FFEL or 

Direct Loan programs on or after July 1, 

2008 and prior to July 1, 2011, the 

amount of the loan disbursement for a 

payment period that exceeds the 

disbursement for which the student 

would have been eligible for that 

payment period under the loan limit in 

effect on the day prior to enactment of 

the ECASLA is included and deemed to 

be revenue from a source other than 

Title IV, HEA program funds but only to 

the extent that the excess amount pays 

for tuition, fees, or institutional charges 

remaining on the student’s account after 

other Title IV, HEA program funds are 

applied. 

(7) Funds excluded from revenues. 

For the fiscal year, the institution does 

not include— 

(i) The amount of Federal Work Study 

(FWS) wages paid directly to the 

student. However, if the institution 

credits the student’s account with FWS 

funds, those funds are included as 

revenue; 

(ii) The amount of funds received by 

the institution from a State under the 

LEAP, SLEAP, or GAP programs; 

(iii) The amount of institutional funds 

used to match Title IV, HEA program 

funds; 

(iv) The amount of Title IV, HEA 

program funds refunded or returned 

under § 668.22. If any funds from the 

loan disbursement used in the return 

calculation under § 668.22 were counted 

as non-title IV revenue under paragraph 

(a)(6) of this section, the amount of Title 

IV, HEA program funds refunded or 

returned under § 668.22 is considered to 

consist of pre-ECASLA loan amounts 

and loan amounts in excess of the loan 

limits prior to ECASLA in the same 

proportion to the loan disbursement; or 

(v) The amount the student is charged 

for books, supplies, and equipment 

unless the institution includes that 

amount as tuition, fees, or other 

institutional charges. 

(b) Net present value (NPV). (1) As 

illustrated in appendix C of this subpart, 

an institution calculates the NPV of the 

loans it made under paragraph (a)(5)(i) 

of this section by— 


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(i) Using the formula, NPV = sum of 

the discounted cash flows Rt

/(1+i)t, 

where— 

(A) The variable ‘‘i’’ is the discount 

rate. For purposes of this section, an 

institution must use the most recent 

annual inflation rate as the discount 

rate; 

(B) The variable ‘‘t’’ is time or period 

of the cash flow, in years, from the time 

the loan entered repayment; and 

(C) The variable ‘‘Rt

’’ is the net cash 

flow at time or period t; and 

(ii) Applying the NPV formula to the 

loans made during the fiscal year by— 

(A) If the loans have substantially the 

same repayment period, using that 

repayment period for the range of values 

of variable ‘‘t’’; or 

(B) Grouping the loans by repayment 

period and using the repayment period 

for each group for the range of values of 

variable ‘‘t’’; and 

(C) For each group of loans, as 

applicable, multiplying the total annual 

payments due on the loans by the 

institution’s loan collection rate (e.g., 

the total amount of payments collected 

divided by the total amount of payments 

due). The resulting amount is used for 

variable ‘‘R’’ in each period ‘‘t’’, for each 

group of loans that a NPV is calculated. 

(2) Instead of performing the 

calculations in paragraph (b)(1) of this 

section, using 50 percent of the total 

amount of loans that the institution 

made during the fiscal year as the NPV. 

However, if the institution chooses to 

use this 50 percent calculation, the 

institution may not sell any of these 

loans until they have been in repayment 

for at least two years. 

(c) Sanctions. If an institution does 

not derive at least 10 percent of its 

revenue from sources other than Title 

IV, HEA program funds— 

(1) For two consecutive fiscal years, it 

loses its eligibility to participate in the 

Title IV, HEA programs for at least two 

fiscal years. To regain eligibility, the 

institution must demonstrate that it 

complied with the State licensure and 

accreditation requirements under 34 

CFR 600.5(a)(4) and (a)(6), and the 

financial responsibility requirements 

under subpart L of this part, for a 

minimum of two fiscal years after the 

fiscal year it became ineligible; or 

(2) For any fiscal year, it becomes 

provisionally certified under 

§ 668.13(c)(1)(ii) for the two fiscal years 

after the fiscal year it failed to satisfy the 

revenue requirement. However, the 

institution’s provisional certification 

terminates on— 

(i) The expiration date of the 

institution’s program participation 

agreement that was in effect on the date 

the Secretary determined the institution 

failed this requirement; or 

(ii) The date the institution loses its 

eligibility to participate under 

paragraph (c)(1) of this section; and 

(3) It must notify the Secretary no 

later than 45 days after the end of its 

fiscal year that it failed to meet this 

requirement. 

(Approved by Office of Management and 

Budget under control number 1845–NEW2) 

(Authority: 20 U.S.C. 1085, 1088, 1091, 1092, 

1094, 1099a–3, 1099c, 1141) 

■ 14. Appendix C is added to subpart B 

of part 668 to read as follows: 

BILLING CODE 4000–01–P 


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BILLING CODE 4000–01–C 

■ 15. Section 668.32 is amended by: 

■ A. Revising the introductory text. 

■ B. In paragraph (a)(1)(iii), adding the 

word ‘‘and’’ after the punctuation ‘‘;’’. 

■ C. In paragraph (a)(2), removing the 

punctuation ‘‘;’’ and adding, in its place, 

the punctuation ‘‘.’’. 

■ D. In paragraph (b), removing the 

punctuation ‘‘;’’ and adding, in its place, 

the punctuation ‘‘.’’. 

■ E. In paragraph (c)(4)(ii), removing the 

punctuation ‘‘;’’ and adding, in its place, 

the punctuation ‘‘.’’. 

■ F. In paragraph (d), removing the 

punctuation ‘‘;’’ and adding, in its place, 

the punctuation ‘‘.’’. 

■ G. In paragraph (e)(4)(ii), removing the 

punctuation ‘‘;’’ and adding, in its place, 

the punctuation ‘‘.’’. 

■ H. In paragraph (f), removing the 

punctuation ‘‘;’’ and adding, in its place, 

the punctuation ‘‘.’’. 

■ I. In paragraph (g)(4), removing the 

punctuation ‘‘;’’ at the end of the 

paragraph and adding, in its place, the 

punctuation ‘‘.’’. 

■ J. In paragraph (h), removing the 

punctuation ‘‘;’’ and adding, in its place, 

the punctuation ‘‘.’’. 

■ K. In paragraph (i), removing the 

punctuation ‘‘;’’ and adding, in its place, 

the punctuation ‘‘.’’. 

■ L. In paragraph (j), removing the 

punctuation ‘‘;’’ and adding, in its place, 

the punctuation ‘‘.’’. 

■ M. In paragraph (k)(9), removing the 

word ‘‘; and’’ and adding, in its place, 

the punctuation ‘‘.’’. 

■ N. In paragraph (l), removing the word 

‘‘; and’’ and adding, in its place, the 

punctuation ‘‘.’’. 

■ O. Adding paragraph (n). 

The revision and addition read as 

follows: 

§ 668.32 Student eligibility—general. 

A student is eligible to receive Title 

IV, HEA program assistance if the 

student either meets all of the 

requirements in paragraphs (a) through 

(m) of this section or meets the 

requirement in paragraph (n) of this 

section as follows: 

* * * * * 

(n) Is enrolled in a comprehensive 

transition and postsecondary program 

under subpart O of this part and meets 

the student eligibility criteria in that 

subpart. 

* * * * * 

■ 16. Section 668.41 is amended by: 

■ A. In paragraph (a), adding, in 

alphabetical order, the definition of oncampus student housing facility. 

■ B. Revising paragraph (d). 

■ C. Revising paragraph (e). 

■ D. In paragraph (g)(1)(i), removing the 

words ‘‘on request’’. 

■ E. In the OMB control number 

parenthetical at the end of the section, 

removing the words, ‘‘and 1845–0010’’. 

The addition and revisions read as 

follows: 


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§ 668.41 Reporting and disclosure of 

information. 

(a) * * * 

On-campus student housing facility: 

A dormitory or other residential facility 

for students that is located on an 

institution’s campus, as defined in 

§ 668.46(a). 

* * * * * 

(d) General disclosures for enrolled or 

prospective students. An institution 

must make available to any enrolled 

student or prospective student through 

appropriate publications, mailings or 

electronic media, information 

concerning— 

(1) Financial assistance available to 

students enrolled in the institution 

(pursuant to § 668.42). 

(2) The institution (pursuant to 

§ 668.43). 

(3) The institution’s retention rate as 

reported to the Integrated Postsecondary 

Education Data System (IPEDS). In the 

case of a request from a prospective 

student, the information must be made 

available prior to the student’s enrolling 

or entering into any financial obligation 

with the institution. 

(4) The institution’s completion or 

graduation rate and, if applicable, its 

transfer-out rate (pursuant to § 668.45). 

In the case of a request from a 

prospective student, the information 

must be made available prior to the 

student’s enrolling or entering into any 

financial obligation with the institution. 

(5) The placement of, and types of 

employment obtained by, graduates of 

the institution’s degree or certificate 

programs. 

(i) The information provided in 

compliance with this paragraph may be 

gathered from— 

(A) The institution’s placement rate 

for any program, if it calculates such a 

rate; 

(B) State data systems; 

(C) Alumni or student satisfaction 

surveys; or 

(D) Other relevant sources. 

(ii) The institution must identify the 

source of the information provided in 

compliance with this paragraph, as well 

as any time frames and methodology 

associated with it. 

(iii) The institution must disclose any 

placement rates it calculates. 

(6) The types of graduate and 

professional education in which 

graduates of the institution’s four-year 

degree programs enroll. 

(i) The information provided in 

compliance with this paragraph may be 

gathered from— 

(A) State data systems; 

(B) Alumni or student satisfaction 

surveys; or 

(C) Other relevant sources. 

(ii) The institution must identify the 

source of the information provided in 

compliance with this paragraph, as well 

as any time frames and methodology 

associated with it. 

(e) Annual security report and annual 

fire safety report. (1) Enrolled students 

and current employees—annual security 

report and annual fire safety report. By 

October 1 of each year, an institution 

must distribute to all enrolled students 

and current employees its annual 

security report described in § 668.46(b), 

and, if the institution maintains an oncampus student housing facility, its 

annual fire safety report described in 

§ 668.49(b), through appropriate 

publications and mailings, including— 

(i) Direct mailing to each individual 

through the U.S. Postal Service, campus 

mail, or electronic mail; 

(ii) A publication or publications 

provided directly to each individual; or 

(iii) Posting on an Internet Web site or 

an Intranet Web site, subject to 

paragraph (e)(2) and (3) of this section. 

(2) Enrolled students—annual 

security report and annual fire safety 

report. If an institution chooses to 

distribute either its annual security 

report or annual fire safety report to 

enrolled students by posting the 

disclosure or disclosures on an Internet 

Web site or an Intranet Web site, the 

institution must comply with the 

requirements of paragraph (c)(2) of this 

section. 

(3) Current employees—annual 

security report and annual fire safety 

report. If an institution chooses to 

distribute either its annual security 

report or annual fire safety report to 

current employees by posting the 

disclosure or disclosures on an Internet 

Web site or an Intranet Web site, the 

institution must, by October 1 of each 

year, distribute to all current employees 

a notice that includes a statement of the 

report’s availability, the exact electronic 

address at which the report is posted, a 

brief description of the report’s 

contents, and a statement that the 

institution will provide a paper copy of 

the report upon request. 

(4) Prospective students and 

prospective employees—annual security 

report and annual fire safety report. For 

each of the reports, the institution must 

provide a notice to prospective students 

and prospective employees that 

includes a statement of the report’s 

availability, a description of its 

contents, and an opportunity to request 

a copy. An institution must provide its 

annual security report and annual fire 

safety report, upon request, to a 

prospective student or prospective 

employee. If the institution chooses to 

provide either its annual security report 

or annual fire safety report to 

prospective students and prospective 

employees by posting the disclosure on 

an Internet Web site, the notice 

described in this paragraph must 

include the exact electronic address at 

which the report is posted, a brief 

description of the report, and a 

statement that the institution will 

provide a paper copy of the report upon 

request. 

(5) Submission to the Secretary— 

annual security report and annual fire 

safety report. Each year, by the date and 

in a form specified by the Secretary, an 

institution must submit the statistics 

required by §§ 668.46(c) and 668.49(c) 

to the Secretary. 

(6) Publication of the annual fire 

safety report. An institution may 

publish its annual fire safety report 

concurrently with its annual security 

report only if the title of the report 

clearly states that the report contains 

both the annual security report and the 

annual fire safety report. If an 

institution chooses to publish the 

annual fire safety report separately from 

the annual security report, it must 

include information in each of the two 

reports about how to directly access the 

other report. 

* * * * * 

■ 17. Section 668.43 is amended by: 

■ A. In the introductory text of 

paragraph (a), removing the words 

‘‘upon request’’. 

■ B. In paragraph (a)(5)(ii), removing the 

word ‘‘and’’ that appears after the 

punctuation ‘‘;’’. 

■ C. In paragraph (a)(5)(iii), adding the 

word ‘‘and’’ after the punctuation ‘‘;’’. 

■ D. Adding paragraph (a)(5)(iv). 

■ E. Revising paragraph (a)(7). 

■ F. In paragraph (a)(8), removing the 

word ‘‘and’’ that appears after the 

punctuation ‘‘;’’. 

■ G. In paragraph (a)(9), removing the 

punctuation ‘‘.’’ and adding, in its place, 

the punctuation ‘‘;’’. 

■ H. Adding paragraph (a)(10). 

■ I. Adding paragraph (a)(11). 

■ J. In paragraph (b), removing the 

words ‘‘, upon request,’’. 

The additions and revision read as 

follows: 

§ 668.43 Institutional information. 

(a) * * * 

(5) * * * 

(iv) Any plans by the institution for 

improving the academic program of the 

institution, upon a determination by the 

institution that such a plan exists; 

* * * * * 

(7) A description of the services and 

facilities available to students with 


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disabilities, including students with 

intellectual disabilities as defined in 

subpart O of this part; 

* * * * * 

(10) Institutional policies and 

sanctions related to copyright 

infringement, including— 

(i) A statement that explicitly informs 

its students that unauthorized 

distribution of copyrighted material, 

including unauthorized peer-to-peer file 

sharing, may subject the students to 

civil and criminal liabilities; 

(ii) A summary of the penalties for 

violation of Federal copyright laws; and 

(iii) A description of the institution’s 

policies with respect to unauthorized 

peer-to-peer file sharing, including 

disciplinary actions that are taken 

against students who engage in illegal 

downloading or unauthorized 

distribution of copyrighted materials 

using the institution’s information 

technology system; and 

(11) A description of the transfer of 

credit policies established by the 

institution which must include a 

statement of the institution’s current 

transfer of credit policies that includes, 

at a minimum— 

(i) Any established criteria the 

institution uses regarding the transfer of 

credit earned at another institution; and 

(ii) A list of institutions with which 

the institution has established an 

articulation agreement. 

* * * * * 

■ 18. Section 668.45 is revised to read 

as follows: 

§ 668.45 Information on completion or 

graduation rates. 

(a)(1) An institution annually must 

prepare the completion or graduation 

rate of its certificate- or degree-seeking, 

first-time, full-time undergraduate 

students, as provided in paragraph (b) of 

this section. 

(2) An institution that determines that 

its mission includes providing 

substantial preparation for students to 

enroll in another eligible institution 

must prepare the transfer-out rate of its 

certificate- or degree-seeking, first-time, 

full-time undergraduate students, as 

provided in paragraph (c) of this 

section. 

(3)(i) An institution that offers a 

predominant number of its programs 

based on semesters, trimesters, or 

quarters must base its completion or 

graduation rate, retention rate, and, if 

applicable, transfer-out rate 

calculations, on the cohort of certificateor degree-seeking, first-time, full-time 

undergraduate students who enter the 

institution during the fall term of each 

year. 

(ii) An institution not covered by the 

provisions of paragraph (a)(3)(i) of this 

section must base its completion or 

graduation rate, retention rate, and, if 

applicable, transfer-out rate 

calculations, on the cohort of certificateor degree-seeking, first-time, full-time 

undergraduate students who enter the 

institution between September 1 of one 

year and August 31 of the following 

year. 

(4)(i) An institution covered by the 

provisions of paragraph (a)(3)(i) of this 

section must count as an entering 

student a first-time undergraduate 

student who is enrolled as of October 

15, the end of the institution’s drop-add 

period, or another official reporting date 

as defined in § 668.41(a). 

(ii) An institution covered by 

paragraph (a)(3)(ii) of this section must 

count as an entering student a first-time 

undergraduate student who is enrolled 

for at least— 

(A) 15 days, in a program of up to, 

and including, one year in length; or 

(B) 30 days, in a program of greater 

than one year in length. 

(5) An institution must make available 

its completion or graduation rate and, if 

applicable, transfer-out rate, no later 

than the July 1 immediately following 

the 12-month period ending August 31 

during which 150 percent of the normal 

time for completion or graduation has 

elapsed for all of the students in the 

group on which the institution bases its 

completion or graduation rate and, if 

applicable, transfer-out rate 

calculations. 

(6)(i) Completion or graduation rate 

information must be disaggregated by 

gender, by each major racial and ethnic 

subgroup (as defined in IPEDS), by 

recipients of a Federal Pell Grant, by 

recipients of a Federal Family Education 

Loan or a Federal Direct Loan (other 

than an Unsubsidized Stafford Loan 

made under the Federal Family 

Education Loan Program or a Federal 

Direct Unsubsidized Stafford Loan) who 

did not receive a Federal Pell Grant, and 

by recipients of neither a Federal Pell 

Grant nor a Federal Family Education 

Loan or a Federal Direct Loan (other 

than an Unsubsidized Stafford Loan 

made under the Federal Family 

Education Loan Program or a Federal 

Direct Unsubsidized Loan) if the 

number of students in such group or 

with such status is sufficient to yield 

statistically reliable information and 

reporting will not reveal personally 

identifiable information about an 

individual student. If such number is 

not sufficient for such purpose, i.e., is 

too small to be meaningful, then the 

institution shall note that the institution 

enrolled too few of such students to so 

disclose or report with confidence and 

confidentiality. 

(ii) With respect to the requirement in 

paragraph (a)(6)(i) of this section to 

disaggregate the completion or 

graduation rate information by the 

receipt or nonreceipt of Federal student 

aid, students shall be considered to have 

received the aid in question only if they 

received such aid for the period 

specified in paragraph (a)(3) of this 

section. 

(iii) The requirement in paragraph 

(a)(6)(i) of this section shall not apply to 

two-year, degree-granting institutions of 

higher education until academic year 

2011–2012. 

(b) In calculating the completion or 

graduation rate under paragraph (a)(1) of 

this section, an institution must count 

as completed or graduated— 

(1) Students who have completed or 

graduated by the end of the 12-month 

period ending August 31 during which 

150 percent of the normal time for 

completion or graduation from their 

program has lapsed; and 

(2) Students who have completed a 

program described in § 668.8(b)(1)(ii), or 

an equivalent program, by the end of the 

12-month period ending August 31 

during which 150 percent of normal 

time for completion from that program 

has lapsed. 

(c) In calculating the transfer-out rate 

under paragraph (a)(2) of this section, an 

institution must count as transfers-out 

students who by the end of the 12- 

month period ending August 31 during 

which 150 percent of the normal time 

for completion or graduation from the 

program in which they were enrolled 

has lapsed, have not completed or 

graduated but have subsequently 

enrolled in any program of an eligible 

institution for which its program 

provided substantial preparation. 

(d) For the purpose of calculating a 

completion or graduation rate and a 

transfer-out rate, an institution may— 

(1) Exclude students who— 

(i) Have left school to serve in the 

Armed Forces; 

(ii) Have left school to serve on 

official church missions; 

(iii) Have left school to serve with a 

foreign aid service of the Federal 

Government, such as the Peace Corps; 

(iv) Are totally and permanently 

disabled; or 

(v) Are deceased. 

(2) In cases where the students 

described in paragraphs (d)(1)(i) through 

(iii) of this section represent 20 percent 

or more of the certificate- or degreeseeking, full-time, undergraduate 

students at the institution, recalculate 

the completion or graduation rates of 

those students by adding to the 150 


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percent time-frame they normally have 

to complete or graduate, as described in 

paragraph (b) of this section, the time 

period the students were not enrolled 

due to their service in the Armed 

Forces, on official church missions, or 

with a recognized foreign aid service of 

the Federal Government. 

(e)(1) The Secretary grants a waiver of 

the requirements of this section dealing 

with completion and graduation rate 

data to any institution that is a member 

of an athletic association or conference 

that has voluntarily published 

completion or graduation rate data, or 

has agreed to publish data, that the 

Secretary determines are substantially 

comparable to the data required by this 

section. 

(2) An institution that receives a 

waiver of the requirements of this 

section must still comply with the 

requirements of § 668.41(d)(3) and (f). 

(3) An institution, or athletic 

association or conference applying on 

behalf of an institution, that seeks a 

waiver under paragraph (e)(1) of this 

section must submit a written 

application to the Secretary that 

explains why it believes the data the 

athletic association or conference 

publishes are accurate and substantially 

comparable to the information required 

by this section. 

(f) In addition to calculating the 

completion or graduation rate required 

by paragraph (a)(1) of this section, an 

institution may, but is not required to— 

(1) Calculate a completion or 

graduation rate for students who 

transfer into the institution; 

(2) Calculate a completion or 

graduation rate for students described in 

paragraphs (d)(1)(i) through (iv) of this 

section; and 

(3) Calculate a transfer-out rate as 

specified in paragraph (c) of this 

section, if the institution determines 

that its mission does not include 

providing substantial preparation for its 

students to enroll in another eligible 

institution. 

(Approved by the Office of Management and 

Budget under control number 1845–0004) 

(Authority: 20 U.S.C. 1092) 

■ 19. Section 668.46 is amended by: 

■ A. In paragraph (a), adding, in 

alphabetical order, a definition of test. 

■ B. Adding paragraphs (b)(13) and 

(b)(14). 

■ C. Revising paragraph (c)(3). 

■ D. Revising the heading for paragraph 

(e). 

■ E. Adding paragraph (e)(3). 

■ F. Adding paragraph (g). 

■ G. Adding paragraph (h). 

The additions and revisions read as 

follows: 

§ 668.46 Institutional security policies and 

crime statistics. 

(a) * * * 

Test: Regularly scheduled drills, 

exercises, and appropriate followthrough activities, designed for 

assessment and evaluation of emergency 

plans and capabilities. 

* * * * * 

(b) * * * 

(13) Beginning with the annual 

security report distributed by October 1, 

2010, a statement of policy regarding 

emergency response and evacuation 

procedures, as described in paragraph 

(g) of this section. 

(14) Beginning with the annual 

security report distributed by October 1, 

2010, a statement of policy regarding 

missing student notification procedures, 

as described in paragraph (h) of this 

section. 

(c) * * * 

(3) Reported crimes if a hate crime. 

An institution must report, by category 

of prejudice, the following crimes 

reported to local police agencies or to a 

campus security authority that manifest 

evidence that the victim was 

intentionally selected because of the 

victim’s actual or perceived race, 

gender, religion, sexual orientation, 

ethnicity, or disability: 

(i) Any crime it reports pursuant to 

paragraph (c)(1)(i) through (vii) of this 

section. 

(ii) The crimes of larceny-theft, simple 

assault, intimidation, and destruction/ 

damage/vandalism of property. 

(iii) Any other crime involving bodily 

injury. 

* * * * * 

(e) Timely warning and emergency 

notification. * * * 

(3) If there is an immediate threat to 

the health or safety of students or 

employees occurring on campus, as 

described in paragraph (g)(1) of this 

section, an institution must follow its 

emergency notification procedures. An 

institution that follows its emergency 

notification procedures is not required 

to issue a timely warning based on the 

same circumstances; however, the 

institution must provide adequate 

follow-up information to the community 

as needed. 

* * * * * 

(g) Emergency response and 

evacuation procedures. An institution 

must include a statement of policy 

regarding its emergency response and 

evacuation procedures in the annual 

security report. This statement must 

include— 

(1) The procedures the institution will 

use to immediately notify the campus 

community upon the confirmation of a 

significant emergency or dangerous 

situation involving an immediate threat 

to the health or safety of students or 

employees occurring on the campus; 

(2) A description of the process the 

institution will use to— 

(i) Confirm that there is a significant 

emergency or dangerous situation as 

described in paragraph (g)(1) of this 

section; 

(ii) Determine the appropriate 

segment or segments of the campus 

community to receive a notification; 

(iii) Determine the content of the 

notification; and 

(iv) Initiate the notification system. 

(3) A statement that the institution 

will, without delay, and taking into 

account the safety of the community, 

determine the content of the notification 

and initiate the notification system, 

unless issuing a notification will, in the 

professional judgment of responsible 

authorities, compromise efforts to assist 

a victim or to contain, respond to, or 

otherwise mitigate the emergency; 

(4) A list of the titles of the person or 

persons or organization or organizations 

responsible for carrying out the actions 

described in paragraph (g)(2) of this 

section; 

(5) The institution’s procedures for 

disseminating emergency information to 

the larger community; and 

(6) The institution’s procedures to test 

the emergency response and evacuation 

procedures on at least an annual basis, 

including— 

(i) Tests that may be announced or 

unannounced; 

(ii) Publicizing its emergency 

response and evacuation procedures in 

conjunction with at least one test per 

calendar year; and 

(iii) Documenting, for each test, a 

description of the exercise, the date, 

time, and whether it was announced or 

unannounced. 

(h) Missing student notification 

policies and procedures. (1) An 

institution that provides any on-campus 

student housing facility must include a 

statement of policy regarding missing 

student notification procedures for 

students who reside in on-campus 

student housing facilities in its annual 

security report. This statement must— 

(i) Indicate a list of titles of the 

persons or organizations to which 

students, employees, or other 

individuals should report that a student 

has been missing for 24 hours; 

(ii) Require that any missing student 

report must be referred immediately to 

the institution’s police or campus 

security department, or, in the absence 

of an institutional police or campus 

security department, to the local law 


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enforcement agency that has jurisdiction 

in the area; 

(iii) Contain an option for each 

student to identify a contact person or 

persons whom the institution shall 

notify within 24 hours of the 

determination that the student is 

missing, if the student has been 

determined missing by the institutional 

police or campus security department, 

or the local law enforcement agency; 

(iv) Advise students that their contact 

information will be registered 

confidentially, that this information will 

be accessible only to authorized campus 

officials, and that it may not be 

disclosed, except to law enforcement 

personnel in furtherance of a missing 

person investigation; 

(v) Advise students that if they are 

under 18 years of age and not 

emancipated, the institution must notify 

a custodial parent or guardian within 24 

hours of the determination that the 

student is missing, in addition to 

notifying any additional contact person 

designated by the student; and 

(vi) Advise students that, the 

institution will notify the local law 

enforcement agency within 24 hours of 

the determination that the student is 

missing, unless the local law 

enforcement agency was the entity that 

made the determination that the student 

is missing. 

(2) The procedures that the institution 

must follow when a student who resides 

in an on-campus student housing 

facility is determined to have been 

missing for 24 hours include— 

(i) If the student has designated a 

contact person, notifying that contact 

person within 24 hours that the student 

is missing; 

(ii) If the student is under 18 years of 

age and is not emancipated, notifying 

the student’s custodial parent or 

guardian and any other designated 

contact person within 24 hours that the 

student is missing; and 

(iii) Regardless of whether the student 

has identified a contact person, is above 

the age of 18, or is an emancipated 

minor, informing the local law 

enforcement agency that has jurisdiction 

in the area within 24 hours that the 

student is missing. 

* * * * * 

■ 20. Section 668.49 is added to subpart 

D of part 668 to read as follows: 

§ 668.49 Institutional fire safety policies 

and fire statistics. 

(a) Additional definitions that apply 

to this section. 

Cause of fire: The factor or factors that 

give rise to a fire. The causal factor may 

be, but is not limited to, the result of an 

intentional or unintentional action, 

mechanical failure, or act of nature. 

Fire: Any instance of open flame or 

other burning in a place not intended to 

contain the burning or in an 

uncontrolled manner. 

Fire drill: A supervised practice of a 

mandatory evacuation of a building for 

a fire. 

Fire-related injury: Any instance in 

which a person is injured as a result of 

a fire, including an injury sustained 

from a natural or accidental cause, 

while involved in fire control, 

attempting rescue, or escaping from the 

dangers of the fire. The term ‘‘person’’ 

may include students, employees, 

visitors, firefighters, or any other 

individuals. 

Fire-related death: Any instance in 

which a person— 

(1) Is killed as a result of a fire, 

including death resulting from a natural 

or accidental cause while involved in 

fire control, attempting rescue, or 

escaping from the dangers of a fire; or 

(2) Dies within one year of injuries 

sustained as a result of the fire. 

Fire safety system: Any mechanism or 

system related to the detection of a fire, 

the warning resulting from a fire, or the 

control of a fire. This may include 

sprinkler systems or other fire 

extinguishing systems, fire detection 

devices, stand-alone smoke alarms, 

devices that alert one to the presence of 

a fire, such as horns, bells, or strobe 

lights; smoke-control and reduction 

mechanisms; and fire doors and walls 

that reduce the spread of a fire. 

Value of property damage: The 

estimated value of the loss of the 

structure and contents, in terms of the 

cost of replacement in like kind and 

quantity. This estimate should include 

contents damaged by fire, and related 

damages caused by smoke, water, and 

overhaul; however, it does not include 

indirect loss, such as business 

interruption. 

(b) Annual fire safety report. 

Beginning by October 1, 2010, an 

institution that maintains any oncampus student housing facility must 

prepare an annual fire safety report that 

contains, at a minimum, the following 

information: 

(1) The fire statistics described in 

paragraph (c) of this section. 

(2) A description of each on-campus 

student housing facility fire safety 

system. 

(3) The number of fire drills held 

during the previous calendar year. 

(4) The institution’s policies or rules 

on portable electrical appliances, 

smoking, and open flames in a student 

housing facility. 

(5) The institution’s procedures for 

student housing evacuation in the case 

of a fire. 

(6) The policies regarding fire safety 

education and training programs 

provided to the students and employees. 

In these policies, the institution must 

describe the procedures that students 

and employees should follow in the 

case of a fire. 

(7) For purposes of including a fire in 

the statistics in the annual fire safety 

report, a list of the titles of each person 

or organization to which students and 

employees should report that a fire 

occurred. 

(8) Plans for future improvements in 

fire safety, if determined necessary by 

the institution. 

(c) Fire statistics. (1) An institution 

must report statistics for each oncampus student housing facility, for the 

three most recent calendar years for 

which data are available, concerning— 

(i) The number of fires and the cause 

of each fire; 

(ii) The number of persons who 

received fire-related injuries that 

resulted in treatment at a medical 

facility, including at an on-campus 

health center; 

(iii) The number of deaths related to 

a fire; and 

(iv) The value of property damage 

caused by a fire. 

(2) An institution is required to 

submit a copy of the fire statistics in 

paragraph (c)(1) of this section to the 

Secretary on an annual basis. 

(d) Fire log. (1) An institution that 

maintains on-campus student housing 

facilities must maintain a written, easily 

understood fire log that records, by the 

date that the fire was reported, any fire 

that occurred in an on-campus student 

housing facility. This log must include 

the nature, date, time, and general 

location of each fire. 

(2) An institution must make an entry 

or an addition to an entry to the log 

within two business days, as defined 

under § 668.46(a), of the receipt of the 

information. 

(3) An institution must make the fire 

log for the most recent 60-day period 

open to public inspection during normal 

business hours. The institution must 

make any portion of the log older than 

60 days available within two business 

days of a request for public inspection. 

(4) An institution must make an 

annual report to the campus community 

on the fires recorded in the fire log. This 

requirement may be satisfied by the 

annual fire safety report described in 

paragraph (b) of this section. 

(Approved by the Office of Management and 

Budget under control number 1845–NEW3) 


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(Authority: 20 U.S.C. 1092) 

■ 21. Appendix A to subpart D of part 

668 is amended by: 

■ A. Revising the introductory text. 

■ B. Under the heading, ‘‘Crime 

Definitions From the Uniform Crime 

Reporting Handbook,’’ by: 

■ i. Removing the definition of Weapon 

Law Violations; 

■ ii. Adding a new definition of 

Weapons: Carrying, Possessing, Etc.; 

and 

■ iii. Revising the definitions of Drug 

Abuse Violations and Liquor Law 

Violations. 

■ C. Adding a heading at the end of the 

appendix, ‘‘Definitions From the Hate 

Crime Data Collection Guidelines of the 

Uniform Crime Reporting Handbook’’ 

followed by definitions for larceny-theft 

(except motor vehicle theft), simple 

assault, intimidation, and destruction/ 

damage/vandalism of property. 

The revisions and additions read as 

follows: Appendix A to Subpart D of 

Part 668—Crime Definitions in 

Accordance with the Federal Bureau of 

Investigation’s Uniform Crime Reporting 

Program 

The following definitions are to be 

used for reporting the crimes listed in 

§ 668.46, in accordance with the Federal 

Bureau of Investigation’s Uniform Crime 

Reporting Program. The definitions for 

murder; robbery; aggravated assault; 

burglary; motor vehicle theft; weapons: 

carrying, possessing, etc.; law violations; 

drug abuse violations; and liquor law 

violations are excerpted from the 

Uniform Crime Reporting Handbook. 

The definitions of forcible rape and 

nonforcible sex offenses are excerpted 

from the National Incident-Based 

Reporting System Edition of the 

Uniform Crime Reporting Handbook. 

The definitions of larceny-theft (except 

motor vehicle theft), simple assault, 

intimidation, and destruction/damage/ 

vandalism of property are excerpted 

from the Hate Crime Data Collection 

Guidelines of the Uniform Crime 

Reporting Handbook. 

* * * * * 

Crime Definitions From the Uniform 

Crime Reporting Handbook 

* * * * * 

Weapons: Carrying, Possessing, Etc. 

The violation of laws or ordinances 

prohibiting the manufacture, sale, 

purchase, transportation, possession, 

concealment, or use of firearms, cutting 

instruments, explosives, incendiary 

devices, or other deadly weapons. 

Drug Abuse Violations 

The violation of laws prohibiting the 

production, distribution, and/or use of 

certain controlled substances and the 

equipment or devices utilized in their 

preparation and/or use. The unlawful 

cultivation, manufacture, distribution, 

sale, purchase, use, possession, 

transportation, or importation of any 

controlled drug or narcotic substance. 

Arrests for violations of state and local 

laws, specifically those relating to the 

unlawful possession, sale, use, growing, 

manufacturing, and making of narcotic 

drugs. 

Liquor Law Violations 

The violation of state or local laws or 

ordinances prohibiting the manufacture, 

sale, purchase, transportation, 

possession, or use of alcoholic 

beverages, not including driving under 

the influence and drunkenness. 

* * * * * 

Definitions From the Hate Crime Data 

Collection Guidelines of the Uniform 

Crime Reporting Handbook 

Larceny-Theft (Except Motor Vehicle 

Theft) 

The unlawful taking, carrying, 

leading, or riding away of property from 

the possession or constructive 

possession of another. Attempted 

larcenies are included. Embezzlement, 

confidence games, forgery, worthless 

checks, etc., are excluded. 

Simple Assault 

An unlawful physical attack by one 

person upon another where neither the 

offender displays a weapon, nor the 

victim suffers obvious severe or 

aggravated bodily injury involving 

apparent broken bones, loss of teeth, 

possible internal injury, severe 

laceration, or loss of consciousness. 

Intimidation 

To unlawfully place another person in 

reasonable fear of bodily harm through 

the use of threatening words and/or 

other conduct, but without displaying a 

weapon or subjecting the victim to 

actual physical attack. 

Destruction/Damage/Vandalism of 

Property 

To willfully or maliciously destroy, 

damage, deface, or otherwise injure real 

or personal property without the 

consent of the owner or the person 

having custody or control of it. 

■ 22. Section 668.161 is amended by 

revising the section heading and 

paragraph (a)(4) to read as follows: 

§ 668.161 Scope and purpose (cash 

management rules). 

(a) * * * 

(4) An institution must follow the 

disbursement procedures in 34 CFR 

675.16 for paying a student his or her 

wages under the FWS Program instead 

of the disbursement procedures in 

§§ 668.164(a), (b), and (d) through (g), 

and 668.165. 

* * * * * 

§ 668.184 [Amended] 

■ 23. Section 668.184(a)(1) is amended 

by removing the word ‘‘If’’ and adding, 

in its place, the words ‘‘Except as 

provided under 34 CFR 600.32(d), if’’. 

■ 24. Subpart O, consisting of 

§§ 668.230 through 668.233, is added to 

part 668 to read as follows: 

Subpart O—Financial Assistance for 

Students With Intellectual Disabilities 

Sec. 

668.230 Scope and purpose. 

668.231 Definitions. 

668.232 Program eligibility. 

668.233 Student eligibility. 

Subpart O—Financial Assistance for 

Students With Intellectual Disabilities 

§ 668.230 Scope and purpose. 

This subpart establishes regulations 

that apply to an institution that offers 

comprehensive transition and 

postsecondary programs to students 

with intellectual disabilities. Students 

enrolled in these programs are eligible 

for Federal financial assistance under 

the Federal Pell Grant, FSEOG, and 

FWS programs. Except for provisions 

related to needs analysis, the Secretary 

may waive any Title IV, HEA program 

requirement related to the Federal Pell 

Grant, FSEOG, and FWS programs or 

institutional eligibility, to ensure that 

students with intellectual disabilities 

remain eligible for funds under these 

assistance programs. However, unless 

provided in this subpart or subsequently 

waived by the Secretary, students with 

intellectual disabilities and institutions 

that offer comprehensive transition and 

postsecondary programs are subject to 

the same regulations and procedures 

that otherwise apply to Title IV, HEA 

program participants. 

(Authority: 20 U.S.C. 1091) 

§ 668.231 Definitions. 

The following definitions apply to 

this subpart: 

(a) Comprehensive transition and 

postsecondary program means a degree, 

certificate, nondegree, or noncertificate 

program that— 

(1) Is offered by a participating 

institution; 

(2) Is delivered to students physically 

attending the institution; 

(3) Is designed to support students 

with intellectual disabilities who are 

seeking to continue academic, career 


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55948 Federal Register / Vol. 74, No. 208 / Thursday, October 29, 2009 / Rules and Regulations 

and technical, and independent living 

instruction at an institution of higher 

education in order to prepare for gainful 

employment; 

(4) Includes an advising and 

curriculum structure; 

(5) Requires students with intellectual 

disabilities to have at least one-half of 

their participation in the program, as 

determined by the institution, focus on 

academic components through one or 

more of the following activities: 

(i) Taking credit-bearing courses with 

students without disabilities. 

(ii) Auditing or otherwise 

participating in courses with students 

without disabilities for which the 

student does not receive regular 

academic credit. 

(iii) Taking non-credit-bearing, 

nondegree courses with students 

without disabilities. 

(iv) Participating in internships or 

work-based training in settings with 

individuals without disabilities; and 

(6) Provides students with intellectual 

disabilities opportunities to participate 

in coursework and other activities with 

students without disabilities. 

(b) Student with an intellectual 

disability means a student— 

(1) With mental retardation or a 

cognitive impairment characterized by 

significant limitations in— 

(i) Intellectual and cognitive 

functioning; and 

(ii) Adaptive behavior as expressed in 

conceptual, social, and practical 

adaptive skills; and 

(2) Who is currently, or was formerly, 

eligible for special education and 

related services under the Individuals 

with Disabilities Education Act (IDEA) 

(20 U.S.C. 1401), including a student 

who was determined eligible for special 

education or related services under the 

IDEA but was home-schooled or 

attended private school. 

(Authority: 20 U.S.C. 1091, 1140) 

§ 668.232 Program eligibility. 

An institution that offers a 

comprehensive transition and 

postsecondary program must apply to 

the Secretary to have the program 

determined to be an eligible program. 

The institution applies under the 

provisions in 34 CFR 600.20 for adding 

an educational program, and must 

include in its application— 

(a) A detailed description of the 

comprehensive transition and 

postsecondary program that addresses 

all of the components of the program, as 

defined in § 668.231; 

(b) The institution’s policy for 

determining whether a student enrolled 

in the program is making satisfactory 

academic progress; 

(c) The number of weeks of 

instructional time and the number of 

semester or quarter credit hours or clock 

hours in the program, including the 

equivalent credit or clock hours 

associated with noncredit or reduced 

credit courses or activities; 

(d) A description of the educational 

credential offered (e.g., degree or 

certificate) or identified outcome or 

outcomes established by the institution 

for all students enrolled in the program; 

(e) A copy of the letter or notice sent 

to the institution’s accrediting agency 

informing the agency of its 

comprehensive transition and 

postsecondary program. The letter or 

notice must include a description of the 

items in paragraphs (a) through (d) of 

this section; and 

(f) Any other information the 

Secretary may require. 

(Approved by the Office of Management and 

Budget under control number 1845–NEW4) 

(Authority: 20 U.S.C. 1091) 

§ 668.233 Student eligibility. 

A student with an intellectual 

disability is eligible to receive Federal 

Pell, FSEOG, and FWS program 

assistance under this subpart if— 

(a) The student satisfies the general 

student eligibility requirements under 

§ 668.32, except for the requirements in 

paragraphs (a), (e), and (f) of that 

section. With regard to these exceptions, 

a student— 

(1) Does not have to be enrolled for 

the purpose of obtaining a degree or 

certificate; 

(2) Is not required to have a high 

school diploma, a recognized equivalent 

of a high school diploma, or have 

passed an ability to benefit test; and 

(3) Is making satisfactory progress 

according to the institution’s published 

standards for students enrolled in its 

comprehensive transition and 

postsecondary programs; 

(b) The student is enrolled in a 

comprehensive transition and 

postsecondary program approved by the 

Secretary; and 

(c) The institution obtains a record 

from a local educational agency that the 

student is or was eligible for special 

education and related services under the 

IDEA. If that record does not identify 

the student as having an intellectual 

disability, as described in paragraph (1) 

of the definition of a student with an 

intellectual disability in § 668.231, the 

institution must also obtain 

documentation establishing that the 

student has an intellectual disability, 

such as— 

(1) A documented comprehensive and 

individualized psycho-educational 

evaluation and diagnosis of an 

intellectual disability by a psychologist 

or other qualified professional; or 

(2) A record of the disability from a 

local or State educational agency, or 

government agency, such as the Social 

Security Administration or a vocational 

rehabilitation agency, that identifies the 

intellectual disability. 

(Approved by the Office of Management and 

Budget under control number 1845–NEW4) 

(Authority: 20 U.S.C. 1091) 

PART 675—FEDERAL WORK-STUDY 

PROGRAMS 

■ 25. The authority citation for part 675 

is revised to read as follows: 

Authority: 20 U.S.C. 1070g, 1094; 42 U.S.C. 

2751–2756b; unless otherwise noted. 

§ 675.2 [Amended] 

■ 26. In § 675.2(b), paragraph (1) of the 

definition of community services is 

amended by adding the words 

‘‘emergency preparedness and 

response,’’ after the words ‘‘public 

safety,’’. 

■ 27. Section 675.16 is revised to read 

as follow: 

§ 675.16 Payments to students. 

(a) General. (1) An institution must 

follow the disbursement procedures in 

this section for paying a student his or 

her wages under the FWS Program 

instead of the disbursement procedures 

in 34 CFR 668.164(a), (b), and (d) 

through (g), and 34 CFR 668.165. The 

institution must follow 34 CFR 

668.164(c) on making direct FWS 

payments to students and 34 CFR 

668.164(h) on handling the return of 

FWS funds that are not received or 

negotiated by a student. 

(2) An institution must pay a student 

FWS compensation at least once a 

month. 

(3) Before an institution makes an 

initial disbursement of FWS 

compensation to a student for an award 

period, the institution must notify the 

student of the amount of funds the 

student is authorized to earn, and how 

and when the FWS compensation will 

be paid. 

(4) Regardless of who employs the 

student, the institution is responsible 

for ensuring that the student is paid for 

work performed. 

(5) A student’s FWS compensation is 

earned when the student performs the 

work. 

(6) An institution may pay a student 

after the student’s last day of attendance 

for FWS compensation earned while he 

or she was in attendance at the 

institution. 


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(7) A correspondence student must 

submit his or her first completed lesson 

before receiving a payment. 

(8) The institution may not obtain a 

student’s power of attorney to authorize 

any disbursement of funds without prior 

approval from the Secretary. 

(9) An institution makes a 

disbursement of FWS program funds on 

the date that the institution credits a 

student’s account at the institution or 

pays a student directly with— 

(i) Funds received from the Secretary; 

or 

(ii) Institutional funds used in 

advance of receiving FWS program 

funds. 

(b) Crediting a student’s account at 

the institution. (1) If the institution 

obtains the student’s authorization 

described in paragraph (d) of this 

section, the institution may use the FWS 

funds to credit a student’s account at the 

institution to satisfy— 

(i) Current year charges for— 

(A) Tuition and fees; 

(B) Board, if the student contracts 

with the institution for board; 

(C) Room, if the student contracts 

with the institution for room; and 

(D) Other educationally related 

charges incurred by the student at the 

institution; and 

(ii) Prior award year charges with the 

restriction provided in paragraph (b)(2) 

of this section for a total of not more 

than $200 for— 

(A) Tuition and fees, room, or board; 

and 

(B) Other institutionally related 

charges incurred by the student at the 

institution. 

(2) If the institution is using FWS 

funds in combination with other Title 

IV, HEA program funds to credit a 

student’s account at the institution to 

satisfy prior award year charges, a single 

$200 total prior award year charge limit 

applies to the use of all the Title IV, 

HEA program funds for that purpose. 

(c) Credit balances. Whenever an 

institution disburses FWS funds by 

crediting a student’s account and the 

result is a credit balance, the institution 

must pay the credit balance directly to 

the student as soon as possible, but no 

later than 14 days after the credit 

balance occurred on the account. 

(d) Student authorizations. (1) Except 

for the noncash contributions allowed 

under paragraph (e)(2) and (3) of this 

section, if an institution obtains written 

authorization from a student, the 

institution may— 

(i) Use the student’s FWS 

compensation to pay for charges 

described in paragraph (b) of this 

section that are included in that 

authorization; and 

(ii) Except if prohibited by the 

Secretary under the reimbursement or 

cash monitoring payment method, hold 

on behalf of the student any FWS 

compensation that would otherwise be 

paid directly to the student under 

paragraph (c) of this section. 

(2) In obtaining the student’s 

authorization to perform an activity 

described in paragraph (d)(1) of this 

section, an institution— 

(i) May not require or coerce the 

student to provide that authorization; 

(ii) Must allow the student to cancel 

or modify that authorization at any time; 

and 

(iii) Must clearly explain how it will 

carry out that activity. 

(3) A student may authorize an 

institution to carry out the activities 

described in paragraph (d)(1) of this 

section for the period during which the 

student is enrolled at the institution. 

(4)(i) If a student modifies an 

authorization, the modification takes 

effect on the date the institution 

receives the modification notice. 

(ii) If a student cancels an 

authorization to use his or her FWS 

compensation to pay for authorized 

charges under paragraph (b) of this 

section, the institution may use those 

funds to pay only those authorized 

charges incurred by the student before 

the institution received the notice. 

(iii) If a student cancels an 

authorization to hold his or her FWS 

compensation under paragraph (d)(1)(ii) 

of this section, the institution must pay 

those funds directly to the student as 

soon as possible, but no later than 14 

days after the institution receives that 

notice. 

(5) If an institution holds excess FWS 

compensation under paragraph (d)(1)(ii) 

of this section, the institution must— 

(i) Identify the amount of funds the 

institution holds for each student in a 

subsidiary ledger account designed for 

that purpose; 

(ii) Maintain, at all times, cash in its 

bank account in an amount at least 

equal to the amount of FWS 

compensation the institution holds for 

the student; and 

(iii) Notwithstanding any 

authorization obtained by the institution 

under this paragraph, pay any 

remaining balances by the end of the 

institution’s final FWS payroll period 

for an award year. 

(e)(1) Timing of institutional share 

and noncash contributions. Except for 

the noncash contributions allowed 

under paragraph (e)(2) or (3) of this 

section, an institution must pay the 

student its share of his or her FWS 

compensation at the same time it pays 

the Federal share. 

(2) If an institution pays a student its 

FWS share for an award period in the 

form of tuition, fees, services, or 

equipment, it must pay that share before 

the student’s final payroll period. 

(3) If an institution pays its FWS share 

in the form of prepaid tuition, fees, 

services, or equipment for a forthcoming 

academic period, it must give the 

student a statement before the close of 

his or her final payroll period listing the 

amount of tuition, fees, services, or 

equipment earned. 

(Authority: 20 U.S.C. 1091, 1094; 42 U.S.C. 

2753) 

■ 28. Section 675.18 is amended by: 

■ A. Adding paragraph (g)(4). 

■ B. Adding paragraph (i). 

■ C. Revising the authority citation at 

the end of the section. 

The additions and revisions read as 

follows: 

§ 675.18 Use of funds. 

* * * * * 

(g) * * * 

(4)(i) In meeting the seven percent 

community service expenditure 

requirement in paragraph (g)(1) of this 

section, students may be employed to 

perform civic education and 

participation activities in projects that— 

(A) Teach civics in schools; 

(B) Raise awareness of government 

functions or resources; or 

(C) Increase civic participation. 

(ii) To the extent practicable, in 

providing civic education and 

participation activities under paragraph 

(g)(4)(i) of this section, an institution 

must— 

(A) Give priority to the employment 

of students in projects that educate or 

train the public about evacuation, 

emergency response, and injury 

prevention strategies relating to natural 

disasters, acts of terrorism, and other 

emergency situations; and 

(B) Ensure that the students receive 

appropriate training to carry out the 

educational services required. 

* * * * * 

(i) Flexibility in the event of a major 

disaster. (1) An institution located in 

any area affected by a major disaster 

may make FWS payments to disasteraffected students for the period of time 

(not to exceed the award period) in 

which the students were prevented from 

fulfilling their FWS obligations. The 

FWS payments— 

(i) May be made to disaster-affected 

students for an amount equal to or less 

than the amount of FWS wages the 

students would have been paid had the 

students been able to complete the work 

obligation necessary to receive the 

funds; 


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(ii) May not be made to any student 

who was not eligible for FWS or was not 

completing the work obligation 

necessary to receive the funds, or had 

already separated from their 

employment prior to the occurrence of 

the major disaster; and 

(iii) Must meet the matching 

requirements of § 675.26, unless those 

requirements are waived by the 

Secretary. 

(2) The following definitions apply to 

this section: 

(i) Disaster-affected student means a 

student enrolled at an institution who— 

(A) Received an FWS award for the 

award period during which a major 

disaster occurred; 

(B) Earned FWS wages from an 

institution for that award period; 

(C) Was prevented from fulfilling his 

or her FWS obligation for all or part of 

the FWS award period because of the 

major disaster; and 

(D) Was unable to be reassigned to 

another FWS job. 

(ii) Major disaster is defined in 

section 102(2) of the Robert T. Stafford 

Disaster Relief and Emergency 

Assistance Act (42 U.S.C. 5122(2)). 

(Authority: 20 U.S.C. 1095, 1096; 42 U.S.C. 

2753, 2755, 2756, 2756b) 

■ 29. Section 675.26 is amended by: 

■ A. In paragraph (d)(2)(iii), removing 

the word ‘‘or’’ that appears after the 

punctuation ‘‘;’’. 

■ B. In paragraph (d)(2)(iv), removing 

the punctuation ‘‘.’’ and adding, in its 

place, the word ‘‘; or’’. 

■ C. Adding paragraph (d)(2)(v). 

The addition reads as follows: 

§ 675.26 FWS Federal share limitations. 

* * * * * 

(d) * * * 

(2) * * * 

(v) The student is employed in 

community service activities and is 

performing civic education and 

participation activities in a project as 

defined in § 675.18(g)(4). 

* * * * * 

■ 30. Section 675.41 is amended by: 

■ A. Revising paragraph (a). 

■ B. Revising the paragraph heading and 

introductory text in paragraph (b). 

■ C. In paragraph (b)(2), removing the 

word ‘‘, participation,’’. 

■ D. In paragraph (b)(5), removing the 

words ‘‘work-learning’’ and adding, in 

their place, the words ‘‘work-learningservice’’. 

■ E. In paragraph (b)(6), removing the 

words ‘‘work-learning’’ and adding, in 

their place, the words ‘‘work-learningservice’’. 

The revisions read as follows: 

§ 675.41 Special definitions. 

* * * * * 

(a) Work-college: An eligible 

institution that— 

(1) Is a public or private nonprofit, 

four-year, degree-granting institution 

with a commitment to community 

service; 

(2) Has operated a comprehensive 

work-learning-service program for at 

least two years; 

(3) Requires resident students, 

including at least one-half of all 

students who are enrolled on a full-time 

basis, to participate in a comprehensive 

work-learning-service program for at 

least five hours each week, or at least 80 

hours during each period of enrollment, 

except summer school, unless the 

student is engaged in an institutionally 

organized or approved study abroad or 

externship program; and 

(4) Provides students participating in 

the comprehensive work-learningservice program with the opportunity to 

contribute to their education and to the 

welfare of the community as a whole. 

(b) Comprehensive student worklearning-service program: A student 

work-learning-service program that— 

* * * * * 

§ 675.43 [Amended] 

■ 31. Section 675.43 is amended by 

removing the words ‘‘work-learning’’ 

and adding, in their place, the words 

‘‘work-learning-service’’. 

§ 675.44 [Amended] 

■ 32. Section 675.44(b) is amended by 

removing the words ‘‘work-learning’’ 

and adding, in their place, the words 

‘‘work-learning-service’’. 

§ 675.45 [Amended] 

33. Section 675.45 is amended by: 

■ A. In paragraph (a)(1), in the 

introductory text of paragraph (a)(4), 

and in paragraph (a)(4)(i) removing the 

words ‘‘work-learning’’ and adding, in 

their place, the words ‘‘work-learningservice’’. 

■ B. In paragraph (a)(5), removing the 

words ‘‘work service learning’’ and 

adding, in their place, the words ‘‘worklearning-service’’. 

PART 686—TEACHER EDUCATION 

ASSISTANCE FOR COLLEGE AND 

HIGHER EDUCATION (TEACH) GRANT 

PROGRAM 

■ 34. The authority citation for part 686 

continues to read as follows: 

Authority: 20 U.S.C. 1070g, et seq., unless 

otherwise noted. 

§ 686.12 [Amended] 

■ 35. Section 686.12(c)(1) is amended 

by adding the words ‘‘, a suspension 

approved under § 686.41(a)(2), or a 

military discharge granted under 

§ 686.42(c)(2)’’ after the words ‘‘teaching 

service’’. 

■ 36. Section 686.41 is amended by: 

■ A. In the introductory text of 

paragraph (a)(2), removing the words 

‘‘and (ii)’’ and adding, in their place, the 

words ‘‘, (ii), and (iii)’’. 

■ B. Revising paragraphs (a)(2)(ii), (b), 

and (c). 

■ C. Adding an OMB control number at 

the end of the section. 

The revisions and addition read as 

follows: 

§ 686.41 Periods of suspension. 

(a) * * * 

(2) * * * 

(ii) Does not exceed a total of three 

years under paragraph (a)(1)(iii) of this 

section. 

(b) A grant recipient, or his or her 

representative in the case of a grant 

recipient who qualifies under paragraph 

(a)(1)(iii) of this section, must apply for 

a suspension in writing on a form 

approved by the Secretary prior to being 

subject to any of the conditions under 

§ 686.43(a)(1) through (a)(5) that would 

cause the TEACH Grant to convert to a 

Federal Direct Unsubsidized Loan. 

(c) A grant recipient, or his or her 

representative in the case of a grant 

recipient who qualifies under paragraph 

(a)(1)(iii) of this section, must provide 

the Secretary with documentation 

supporting the suspension request as 

well as current contact information 

including home address and telephone 

number. 

(Approved by the Office of Management and 

Budget under control number 1845–0083) 

* * * * * 

■ 37. Section 686.42 is amended by: 

■ A. Adding paragraph (c). 

■ B. Adding an OMB control number at 

the end of the section. 

The additions read as follows: 

§ 686.42 Discharge of agreement to serve. 

* * * * * 

(c) Military discharge. (1) A grant 

recipient who has completed or who has 

otherwise ceased enrollment in a 

TEACH Grant-eligible program for 

which he or she received TEACH Grant 

funds and has exceeded the period of 

time allowed under § 686.41(a)(2)(ii), 

may qualify for a proportional discharge 

of his or her service obligation due to an 

extended call or order to active duty 

status. To apply for a military discharge, 

a grant recipient or his or her 

representative must submit a written 

request to the Secretary. 

(2) A grant recipient described in 

paragraph (c)(1) of this section may 

receive a— 


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(i) One-year discharge of his or her 

service obligation if a call or order to 

active duty status is for more than three 

years; 

(ii) Two-year discharge of his or her 

service obligation if a call or order to 

active duty status is for more than four 

years; 

(iii) Three-year discharge of his or her 

service obligation if a call or order to 

active duty status is for more than five 

years; or 

(iv) Full discharge of his or her 

service obligation if a call or order to 

active duty status is for more than six 

years. 

(3) A grant recipient or his or her 

representative must provide the 

Secretary with— 

(i) A written statement from the grant 

recipient’s commanding or personnel 

officer certifying— 

(A) That the grant recipient is on 

active duty in the Armed Forces of the 

United States; 

(B) The date on which the grant 

recipient’s service began; and 

(C) The date on which the grant 

recipient’s service is expected to end; or 

(ii)(A) A copy of the grant recipient’s 

official military orders; and 

(B) A copy of the grant recipient’s 

military identification. 

(4) For the purpose of this section, the 

Armed Forces means the Army, Navy, 

Air Force, Marine Corps, and the Coast 

Guard. 

(5) Based on a request for a military 

discharge from the grant recipient or his 

or her representative, the Secretary will 

notify the grant recipient or his or her 

representative of the outcome of the 

discharge request. For the portion on the 

service obligation that remains, the 

grant recipient remains responsible for 

fulfilling his or her service obligation in 

accordance with § 686.12. 

(Approved by the Office of Management and 

Budget under control number 1845–0083) 

* * * * * 

PART 690—FEDERAL PELL GRANT 

PROGRAM 

■ 38. The authority citation for part 690 

continues to read as follows: 

Authority: 20 U.S.C. 1070a, 1070g, unless 

otherwise noted. 

■ 39. Section 690.6 is amended by: 

■ A. Revising the section heading. 

■ B. Adding paragraph (e). 

The revision and addition read as 

follows: 

§ 690.6 Duration of student eligibility. 

* * * * * 

(e) If a student receives a Federal Pell 

Grant for the first time on or after July 

1, 2008, the student may receive no 

more than nine Scheduled Awards. 

* * * * * 

■ 40. Section 690.63 is amended by: 

■ A. Adding paragraph (h). 

■ B. Adding an OMB control number 

and authority citation at the end of the 

section. 

The additions read as follows: 

§ 690.63 Calculation of a Federal Pell 

Grant for a payment period. 

* * * * * 

(h) Payment from two Scheduled 

Awards. (1) In a payment period, a 

student may receive a payment from the 

student’s first Scheduled Award in the 

award year and the student’s second 

Scheduled Award in the award year if— 

(i) The student is an eligible student 

who meets the provisions of § 690.67; 

and 

(ii) The student’s payment for the 

payment period is greater than the 

remaining balance of the first Scheduled 

Award. 

(2) The student’s payment for the 

payment period— 

(i) Is calculated based on the total 

credit or clock hours and weeks of 

instructional time in the payment 

period; and 

(ii) Is the remaining amount of the 

first Scheduled Award plus an amount 

from the second Scheduled Award for 

the balance of the payment for the 

payment period. 

(Approved by the Office of Management and 

Budget under control number 1845–NEW5) 

(Authority: 20 U.S.C. 1070a) 

■ 41. Section 690.64 is revised to read 

as follows: 

§ 690.64 Calculation of a Federal Pell 

Grant for a payment period which occurs in 

two award years. 

If a student enrolls in a payment 

period that is scheduled to occur in two 

award years— 

(a) The entire payment period must be 

considered to occur within one award 

year; 

(b)(1) An institution must assign the 

payment period to the award year in 

which the student receives the greater 

payment for the payment period based 

on the information available at the time 

that the student’s Federal Pell Grant is 

initially calculated; 

(2) The institution must reassign the 

payment to the award year providing 

the greater payment if the institution 

receives information that the student 

would receive a greater payment for the 

payment period by reassigning the 

payment to the other award year— 

(i) Subsequent to the initial 

calculation of the student’s payment for 

the payment period; and 

(ii) Not later than the deadline date 

for the first award year that the 

Secretary establishes through 

publication in the Federal Register for 

each award year; and 

(3) The institution may reassign the 

payment to the award year providing 

the greater payment if the institution 

receives information that the student 

would receive a greater payment for the 

payment period by reassigning the 

payment to the other award year— 

(i) Subsequent to the deadline date 

established in paragraph (b)(2) of this 

section; and 

(ii) Not later than the deadline date 

for the first award year for 

administrative relief based on unusual 

circumstances that the Secretary 

establishes through publication in the 

Federal Register for each award year; 

(c) If an institution places the 

payment period in the first award year, 

it shall pay a student with funds from 

the first award year; and 

(d) If an institution places the 

payment period in the second award 

year, it shall pay a student with funds 

from the second award year. 

(Approved by the Office of Management and 

Budget under control number 1845–NEW5) 

(Authority: 20 U.S.C. 1070a) 

■ 42. Section 690.67 is revised to read 

as follows: 

§ 690.67 Receiving up to two Scheduled 

Awards during a single award year. 

(a) Eligibility. An institution shall 

award up to the full amount of a second 

Scheduled Award to a student in an 

award year if the student— 

(1) Is enrolled for credit or clock 

hours that are attributable to the 

student’s second academic year in the 

award year; 

(2) Is enrolled in an eligible program 

leading to a bachelor’s or associate 

degree or other recognized educational 

credential except as provided in 34 CFR 

part 668, subpart O for students with 

intellectual disabilities; and 

(3) Is enrolled at least as a half-time 

student. 

(b) Transfer student. (1) Options. If a 

student transfers to an institution during 

an award year, the institution must 

determine the credit or clock hours 

earned in the award year at the other 

institutions in accordance with 

paragraph (b)(2) or (3) of this section. 

(2) Assumption method. (i) The 

institution may assume that a student 

has completed the credit or clock hours 

in the first academic year of the award 

year if the first Scheduled Award was 

disbursed at other institutions during 

the award year; or 

(ii) If less than the first Scheduled 

Award has been disbursed at a prior 


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institution that the student attended 

during the award year, the institution 

must determine the credit or clock 

hours the student is considered to have 

previously earned in the award year 

by— 

(A) Multiplying the amount of the 

student’s Scheduled Award disbursed at 

a prior institution during the award year 

by the number of credit or clock hours 

in the institution’s academic year and 

dividing the product of the 

multiplication by the amount of the 

Scheduled Award at the prior 

institution; and 

(B) If the student previously attended 

more than one institution in the award 

year, adding the results of paragraph 

(b)(2)(i) of this section for each prior 

institution. 

(3) Hours-earned method. (i) If the 

institution has information concerning 

the credit or clock hours earned by a 

student while attending other 

institutions, the institution may 

determine the credit or clock hours 

actually earned at other institutions. 

(ii) To make a determination under 

paragraph (b)(3)(i) of this section, the 

institution must have information that— 

(A) Includes the time periods when 

the credit or clock hours were earned; 

and 

(B) Does not include nonapplicable 

credit or clock hours described in 

paragraph (d) of this section. 

(iii) An institution must attribute to 

the current award year any credit or 

clock hours earned at other institutions 

that were earned in a payment period 

that it determines was scheduled to 

occur in the prior award year and the 

current award year. 

(4) Receipt of additional information. 

(i) If an institution receives additional 

information concerning, for paragraph 

(b)(2) of this section, Federal Pell Grant 

disbursements or, for paragraph (b)(3) of 

this section, credit or clock hours 

earned at other institutions and related 

information, subsequent to a prior 

payment period in which the institution 

disbursed a payment of a second 

Scheduled Award in the award year 

based on the application of paragraph 

(b)(2) or (3) of this section, the 

institution is not required to apply the 

information to the prior payment 

period. 

(c) Special circumstances. (1) In a 

payment period in which there is 

insufficient remaining eligibility from a 

student’s first Scheduled Award to 

provide a full payment for the payment 

period, the financial aid administrator at 

the institution may waive the 

requirement in paragraph (a)(1) of this 

section, if the financial aid 

administrator— 

(i) Determines that the student due to 

circumstances beyond the student’s 

control was unable to complete the 

credit or clock hours of the first 

academic year that are necessary to be 

enrolling for credit or clock hours that 

are attributable to the second academic 

year; and 

(ii) The determination is made and 

documented on an individual basis. 

(2) For purposes of paragraph (c)(1) of 

this section, circumstances beyond a 

student’s control— 

(i) May include, but are not limited to, 

the student withdrawing from classes 

due to illness or being unable to register 

for classes necessary to complete his or 

her eligible program because those 

classes were not offered during that 

period; and 

(ii) Do not include, for example, 

withdrawing to avoid a particular grade 

or failing to register for a necessary class 

that was offered during the period to 

avoid a particular instructor. 

(d) Nonapplicable credit or clock 

hours. To determine the student’s 

eligibility for a second Scheduled 

Award in an award year, an institution 

may not use credit or clock hours that 

the student received based on Advanced 

Placement (AP) programs, International 

Baccalaureate (IB) programs, testing out, 

life experience, or similar competency 

measures. 

(Approved by the Office of Management and 

Budget under control number 1845–NEW5) 

(Authority: 20 U.S.C. 1070a) 

PART 692—LEVERAGING 

EDUCATIONAL ASSISTANCE 

PARTNERSHIP PROGRAM 

■ 43. The authority citation for part 692 

is revised to read as follows: 

Authority: 20 U.S.C. 1070c–1070c–4, 

unless otherwise noted. 

§ 692.10 [Amended] 

■ 44. Section 692.10 is amended by: 

■ A. In paragraph (a)(1), adding the 

words ‘‘for the programs under this 

part’’ after the number ‘‘1979’’. 

■ B. In paragraph (a)(2), removing the 

word ‘‘If’’ and adding, in its place, the 

words ‘‘For the programs under this 

part, if’’. 

■ C. In paragraph (a)(2), removing the 

word ‘‘LEAP’’ each time it appears. 

■ D. In paragraph (b), removing the 

word ‘‘-appropriated’’ after the word 

‘‘State’’, both times it appears. 

■ E. In the authority citation at the end 

of the section, adding ‘‘, 1070c–2’’ after 

the number ‘‘1070c’’ 

■ 45. Section 692.21 is amended by: 

■ A. In paragraph (c), removing the 

figure ‘‘$5,000’’ and adding, in its place, 

the words ‘‘the lesser of $12,500 or the 

student’s cost of attendance under 

section 472 of the HEA’’. 

■ B. In paragraph (j), removing the word 

‘‘and’’ that appears after the punctuation 

‘‘;’’. 

■ C. Redesignating paragraph (k) as 

paragraph (l). 

■ D. Adding a new paragraph (k). 

■ E. Adding an OMB control number at 

the end of the section. 

The additions read as follows: 

§ 692.21 What requirements must be met 

by a State program? 

* * * * * 

(k) Notifies eligible students that the 

grants are— 

(1) Leveraging Educational Assistance 

Partnership Grants; and 

(2) Funded by the Federal 

Government, the State, and, where 

applicable, other contributing partners; 

and 

* * * * * 

(Approved by the Office of Management and 

Budget under control number 1845–NEW7) 

* * * * * 

■ 46. Section 692.70 is revised to read 

as follows: 

§ 692.70 How does the Secretary allot 

funds to the States? 

For fiscal year 2010–2011, the 

Secretary allots to each eligible State 

that applies for SLEAP funds an amount 

in accordance with the provisions in 

§ 692.10 prior to calculating allotments 

for States applying for GAP funds under 

subpart C of this part. 

(Authority: 20 U.S.C. 1070c–3a) 

■ 47. Subpart C, consisting of §§ 692.90 

through 692.130 and Appendix A, is 

added to part 692 to read as follows: 

Subpart C—Grants for Access and 

Persistence Program 

General 

Sec. 

692.90 What is the Grants for Access and 

Persistence Program? 

692.91 What other regulations apply to the 

GAP Program? 

692.92 What definitions apply to the GAP 

Program? 

692.93 Who is eligible to participate in the 

GAP Program? 

692.94 What requirements must a State 

satisfy, as the administrator of a 

partnership, to receive GAP Program 

funds? 

How Does a State Apply to Participate in 

GAP? 

692.100 What requirements must a State 

meet to receive an allotment under this 

program? 

692.101 What requirements must be met by 

a State partnership? 


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What Is the Amount of Assistance and How 

May It Be Used? 

692.110 How does the Secretary allot funds 

to the States? 

692.111 For what purposes may a State use 

its payment under the GAP Program? 

692.112 May a State use the funds it 

receives from the GAP Program to pay 

administrative costs? 

692.113 What are the matching 

requirements for the GAP Program? 

How Does the Partnership Select Students 

Under the GAP Program? 

692.120 What are the requirements for 

student eligibility? 

How Does the Secretary Approve a Waiver 

of Program Requirements? 

692.130 How does a participating 

institution request a waiver of program 

requirements? 

Appendix A to Subpart C of Part 692—Grants 

for Access and Persistence Program 

(GAP) State Grant Allotment Case Study 

Subpart C—Grants for Access and 

Persistence Program 

General 

§ 692.90 What is the Grants for Access 

and Persistence Program? 

The Grants for Access and Persistence 

(GAP) Program assists States in 

establishing partnerships to provide 

eligible students with LEAP Grants 

under GAP to attend institutions of 

higher education and to encourage 

increased participation in early 

information and intervention, 

mentoring, or outreach programs. 

(Authority: 20 U.S.C. 1070c–3a) 

§ 692.91 What other regulations apply to 

the GAP Program? 

The regulations listed in § 692.3 also 

apply to the GAP Program. 

(Authority: 20 U.S.C. 1070c–3a) 

§ 692.92 What definitions apply to the GAP 

Program? 

The definitions listed in § 692.4 also 

apply to the GAP Program. 

(Authority: 20 U.S.C. 1070c–3a) 

§ 692.93 Who is eligible to participate in 

the GAP Program? 

(a) States. States that meet the 

requirements in §§ 692.94 and 692.100 

are eligible to receive payments under 

the GAP Program. 

(b) Degree-granting institutions of 

higher education. Degree-granting 

institutions of higher education that 

meet the requirements in § 692.101 are 

eligible to participate in a partnership 

under the GAP Program. 

(c) Early information and 

intervention, mentoring, or outreach 

programs. Early information and 

intervention, mentoring, or outreach 

programs that meet the requirements in 

§ 692.101 are eligible to participate in a 

partnership under the GAP Program. 

(d) Philanthropic organizations or 

private corporations. Philanthropic 

organizations or private corporations 

that meet the requirements in § 692.101 

are eligible to participate in a 

partnership under the GAP Program. 

(e) Students. Students who meet the 

requirements of § 692.120 are eligible to 

receive assistance or services from a 

partnership under the GAP Program. 

(Authority: 20 U.S.C. 1070c–3a) 

§ 692.94 What requirements must a State 

satisfy, as the administrator of a 

partnership, to receive GAP Program 

funds? 

To receive GAP Program funds for any 

fiscal year— 

(a) A State must— 

(1) Participate in the LEAP Program; 

(2) Establish a State partnership 

with— 

(i) At least— 

(A) One public degree-granting 

institution of higher education that is 

located in the State; and 

(B) One private degree-granting 

institution of higher education, if at 

least one exists in the State that may be 

eligible to participate in the State’s 

LEAP Program under subpart A of this 

part; 

(ii) New or existing early information 

and intervention, mentoring, or 

outreach programs located in the State; 

and 

(iii) At least one philanthropic 

organization located in, or that provides 

funding in, the State, or private 

corporation located in, or that does 

business in, the State; 

(3) Meet the requirements in 

§ 692.100; and 

(4) Have a program under this subpart 

that satisfies the requirements in 

§ 692.21(a), (e), (f), (g), and (j). 

(b) A State may provide an early 

information and intervention, 

mentoring, or outreach program under 

paragraph (a)(2)(ii) of this section. 

(Authority: 20 U.S.C. 1070c–3a) 

How Does a State Apply to Participate 

in GAP? 

§ 692.100 What requirements must a State 

meet to receive an allotment under this 

program? 

For a State to receive an allotment 

under the GAP Program, the State 

agency that administers the State’s 

LEAP Program under subpart A of this 

part must— 

(a) Submit an application on behalf of 

a partnership in accordance with the 

provisions in § 692.20 at such time, in 

such manner, and containing such 

information as the Secretary may 

require including— 

(1) A description of— 

(i) The State’s plan for using the 

Federal funds allotted under this 

subpart and the non-Federal matching 

funds; and 

(ii) The methods by which matching 

funds will be paid; 

(2) An assurance that the State will 

provide matching funds in accordance 

with § 692.113; 

(3) An assurance that the State will 

use Federal GAP funds to supplement, 

and not supplant, Federal and State 

funds available for carrying out the 

activities under Title IV of the HEA; 

(4) An assurance that early 

information and intervention, 

mentoring, or outreach programs exist 

within the State or that there is a plan 

to make these programs widely 

available; 

(5) A description of the organizational 

structure that the State has in place to 

administer the program, including a 

description of how the State will 

compile information on degree 

completion of students receiving grants 

under this subpart; 

(6) A description of the steps the State 

will take to ensure, to the extent 

practicable, that students who receive a 

LEAP Grant under GAP persist to degree 

completion; 

(7) An assurance that the State has a 

method in place, such as acceptance of 

the automatic zero expected family 

contribution under section 479(c) of the 

HEA, to identify eligible students and 

award LEAP Grants under GAP to such 

students; 

(8) An assurance that the State will 

provide notification to eligible students 

that grants under this subpart are LEAP 

Grants and are funded by the Federal 

Government and the State, and, where 

applicable, other contributing partners. 

(b) Serve as the primary 

administrative unit for the partnership; 

(c) Provide or coordinate non-Federal 

share funds, and coordinate activities 

among partners; 

(d) Encourage each institution of 

higher education in the State that 

participates in the State’s LEAP Program 

under subpart A of this part to 

participate in the partnership; 

(e) Make determinations and early 

notifications of assistance; 

(f) Ensure that the non-Federal funds 

used as matching funds represent 

dollars that are in excess of the total 

dollars that a State spent for need-based 

grants, scholarships, and work-study 

assistance for fiscal year 1999, including 

the State funds reported for the 

programs under this part; 


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(g) Provide an assurance that, for the 

fiscal year prior to the fiscal year for 

which the State is requesting Federal 

funds, the amount the State expended 

from non-Federal sources per student, 

or the aggregate amount the State 

expended, for all the authorized 

activities in § 692.111 will be no less 

than the amount the State expended 

from non-Federal sources per student, 

or in the aggregate, for those activities 

for the second fiscal year prior to the 

fiscal year for which the State is 

requesting Federal funds; and 

(h) Provide for reports to the Secretary 

that are necessary to carry out the 

Secretary’s functions under the GAP 

Program. 

(Approved by the Office of Management and 

Budget under control number 1845–NEW7) 

(Authority: 20 U.S.C. 1070c–3a) 

§ 692.101 What requirements must be met 

by a State partnership? 

(a) State. A State that is receiving an 

allotment under this subpart must meet 

the requirements under §§ 692.94 and 

692.100. 

(b) Degree-granting institution of 

higher education. A degree-granting 

institution of higher education that is in 

a partnership under this subpart— 

(1) Must participate in the State’s 

LEAP Program under subpart A of this 

part; 

(2) Must recruit and admit 

participating eligible students and 

provide additional institutional grant 

aid to participating students as agreed to 

with the State agency; 

(3) Must provide support services to 

students who receive LEAP Grants 

under GAP and are enrolled at the 

institution; 

(4) Must assist the State in the 

identification of eligible students and 

the dissemination of early notifications 

of assistance as agreed to with the State 

agency; and 

(5) May provide funding or services 

for early information and intervention, 

mentoring, or outreach programs. 

(c) Early information and 

intervention, mentoring, or outreach 

program. An early information and 

intervention, mentoring, or outreach 

program that is in a partnership under 

this subpart shall provide direct 

services, support, and information to 

participating students. 

(d) Philanthropic organization or 

private corporation. A philanthropic 

organization or private corporation in a 

partnership under this subpart shall 

provide non-Federal funds for LEAP 

Grants under GAP for participating 

students or provide funds or support for 

early information and intervention, 

mentoring, or outreach programs. 

(Approved by the Office of Management and 

Budget under control number 1845–NEW7) 

(Authority: 20 U.S.C. 1070c–3a) 

What Is the Amount of Assistance and 

How May It Be Used? 

§ 692.110 How does the Secretary allot 

funds to the States? 

(a)(1) The Secretary allots to each 

State participating in the GAP Program 

an amount of the funds available for the 

GAP Program based on the ratio used to 

allot the State’s Federal LEAP funds 

under § 692.10(a). 

(2) If a State meets the requirements 

of § 692.113(b) for a fiscal year, the 

number of students under § 692.10(a) for 

the State is increased to 125 percent in 

determining the ratio in paragraph (a) of 

this section for that fiscal year. 

(3) Notwithstanding paragraph (a)(1) 

and (2) of this section— 

(i) If the Federal GAP funds available 

from the appropriation for a fiscal year 

are sufficient to allot to each State that 

participated in the prior year the same 

amount of Federal GAP funds allotted in 

the prior fiscal year, but are not 

sufficient both to allot the same amount 

of Federal GAP funds allotted in the 

prior fiscal year to these States and also 

to allot additional funds to additional 

States in accordance with the ratio used 

to allot the States’ Federal LEAP funds 

under § 692.10(a), the Secretary allots— 

(A) To each State that participated in 

the prior year, the amount the State 

received in the prior year; and 

(B) To each State that did not 

participate in the prior year, an amount 

of Federal GAP funds available to States 

based on the ratio used to allot the 

State’s Federal LEAP funds under 

§ 692.10(a); and 

(ii) If the Federal GAP funds available 

from the appropriation for a fiscal year 

are not sufficient to allot to each State 

that participated in the prior year at 

least the amount of Federal GAP funds 

allotted in the prior fiscal year, the 

Secretary allots to each State an amount 

which bears the same ratio to the 

amount of Federal GAP funds available 

as the amount of Federal GAP funds 

allotted to each State in the prior fiscal 

year bears to the amount of Federal GAP 

funds allotted to all States in the prior 

fiscal year. 

(4) For fiscal year 2011, the prior 

fiscal year allotment to a State for 

purposes of paragraph (a)(3) of this 

section shall include any fiscal year 

2010 allotment made to that State under 

subpart B of this part. 

(b) The Secretary allots funds 

available for reallotment in a fiscal year 

in accordance with the provisions of 

paragraph (a) of this section used to 

calculate initial allotments for the fiscal 

year. 

(c) Any funds made available for the 

program under this subpart but not 

expended may be allotted or reallotted 

for the program under subpart A of this 

part. 

(Authority: 20 U.S.C. 1070c–3a) 

§ 692.111 For what purposes may a State 

use its payment under the GAP Program? 

(a) Establishment of a partnership. 

Each State receiving an allotment under 

this subpart shall use the funds to 

establish a partnership to award grants 

to eligible students in order to increase 

the amount of financial assistance 

students receive under this subpart for 

undergraduate education expenses. 

(b) Amount of LEAP Grants under 

GAP. (1) The amount of a LEAP Grant 

under GAP by a State to an eligible 

student shall be not less than— 

(i) The average undergraduate in-State 

tuition and mandatory fees for full-time 

students at the public institutions of 

higher education in the State where the 

student resides that are the same type of 

institution that the student attends 

(four-year degree-granting, two-year 

degree-granting, or non-degreegranting); minus 

(ii) Other Federal and State aid the 

student receives. 

(2) The Secretary determines the 

average undergraduate in-State tuition 

and mandatory fees for full-time 

students at public institutions in a State 

weighted by enrollment using the most 

recent data reported by institutions in 

the State to the Integrated Postsecondary 

Education Data System (IPEDS) 

administered by the National Center for 

Educational Statistics. 

(c) Institutional participation. (1) A 

State receiving an allotment under this 

subpart may restrict the use of LEAP 

Grants under GAP only to students 

attending institutions of higher 

education that are participating in the 

partnership. 

(2) If a State provides LEAP Grants 

under subpart A of this part to students 

attending institutions of higher 

education located in another State, 

LEAP Grants under GAP may be used at 

institutions of higher education located 

in another State. 

(d) Early notification to potentially 

eligible students. (1) Each State 

receiving an allotment under this 

subpart shall annually notify potentially 

eligible students in grades 7 through 12 

in the State, and their families, of their 

potential eligibility for student financial 

assistance, including a LEAP Grant 

under GAP, to attend a LEAPparticipating institution of higher 

education. 


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(2) The notice shall include— 

(i) Information about early 

information and intervention, 

mentoring, or outreach programs 

available to the student; 

(ii) Information that a student’s 

eligibility for a LEAP Grant under GAP 

is enhanced through participation in an 

early information and intervention, 

mentoring, or outreach program; 

(iii) An explanation that student and 

family eligibility for, and participation 

in, other Federal means-tested programs 

may indicate eligibility for a LEAP 

Grant under GAP and other student aid 

programs; 

(iv) A nonbinding estimate of the total 

amount of financial aid that an eligible 

student with a similar income level may 

expect to receive, including an estimate 

of the amount of a LEAP Grant under 

GAP and an estimate of the amount of 

grants, loans, and all other available 

types of aid from the major Federal and 

State financial aid programs; 

(v) An explanation that in order to be 

eligible for a LEAP Grant under GAP, at 

a minimum, a student shall— 

(A) Meet the eligibility requirements 

under § 692.120; and 

(B) Enroll at a LEAP-participating 

institution of higher education in the 

State of the student’s residence or an 

out-of-state institution if the State elects 

to make LEAP Grants under GAP for 

attendance at out-of-State institutions in 

accordance with paragraph (c)(2) of this 

section; 

(vi) Any additional requirements that 

the State may require for receipt of a 

LEAP Grant under GAP in accordance 

with § 692.120(a)(4); and 

(vii) An explanation that a student is 

required to file a Free Application for 

Federal Student Aid to determine his or 

her eligibility for Federal and State 

financial assistance and may include a 

provision that eligibility for an award is 

subject to change based on— 

(A) A determination of the student’s 

financial eligibility at the time of the 

student’s enrollment at a LEAPparticipating institution of higher 

education or an out-of-State institution 

in accordance with paragraph (c)(2) of 

this section; 

(B) Annual Federal and State 

spending for higher education; and 

(C) Other aid received by the student 

at the time of the student’s enrollment 

at the institution of higher education. 

(e) Award notification. (1) Once a 

student, including a student who has 

received early notification under 

paragraph (d) of this section, applies for 

admission to an institution that is a 

partner in the partnership of the State of 

the student’s residence, files a Free 

Application for Federal Student Aid and 

any related State form, and is 

determined eligible by the State, the 

State shall— 

(i) Issue the student a preliminary 

award certificate for a LEAP Grant 

under GAP with estimated award 

amounts; and 

(ii) Inform the student that the 

payment of the grant is subject to 

certification of enrollment and 

eligibility by the institution. 

(2) If a student enrolls in an 

institution that is not a partner in the 

partnership of the student’s State of 

residence but the State has not restricted 

eligibility to students enrolling in 

partner institutions, including, if 

applicable, out-of-State institutions, the 

State shall, to the extent practicable, 

follow the procedures of paragraph 

(e)(1) of this section. 

(Approved by the Office of Management and 

Budget under control number 1845–NEW7) 

(Authority: 20 U.S.C. 1070c–3a) 

§ 692.112 May a State use the funds it 

receives from the GAP Program to pay 

administrative costs? 

(a) A State that receives an allotment 

under this subpart may reserve not more 

than two percent of the funds made 

available annually for State 

administrative functions required for 

administering the partnership and other 

program activities. 

(b) A State must use not less than 

ninety-eight (98) percent of an allotment 

under this subpart to make LEAP Grants 

under GAP. 

(Authority: 20 U.S.C. 1070c–3a) 

§ 692.113 What are the matching 

requirements for the GAP Program? 

(a) The matching funds of a 

partnership— 

(1) Shall be funds used for making 

LEAP Grants to eligible students under 

this subpart; 

(2) May be— 

(i) Cash; or 

(ii) A noncash, in-kind contribution 

that— 

(A) Is fairly evaluated; 

(B) Has monetary value, such as a 

tuition waiver or provision of room and 

board, or transportation; 

(C) Helps a student meet the cost of 

attendance at an institution of higher 

education; and 

(D) Is considered to be estimated 

financial assistance under 34 CFR 

673.5(c); and 

(3) May be funds from the State, 

institutions of higher education, or 

philanthropic organizations or private 

corporations that are used to make 

LEAP Grants under GAP. 

(b) The non-Federal match of the 

Federal allotment shall be— 

(1) Forty-three percent of the 

expenditures under this subpart if a 

State applies for a GAP allotment in 

partnership with— 

(i) Any number of degree-granting 

institutions of higher education in the 

State whose combined full-time 

enrollment represents less than a 

majority of all students attending 

institutions of higher education in the 

State as determined by the Secretary 

using the most recently available data 

from IPEDS; and 

(ii) One or both of the following— 

(A) Philanthropic organizations that 

are located in, or that provide funding 

in, the State; or 

(B) Private corporations that are 

located in, or that do business in, the 

State; and 

(2) Thirty-three and thirty-four onehundredths percent of the expenditures 

under this subpart if a State applies for 

a GAP allotment in partnership with— 

(i) Any number of degree-granting 

institutions of higher education in the 

State whose combined full-time 

enrollment represents a majority of all 

students attending institutions of higher 

education in the State as determined by 

the Secretary using the most recently 

available data from IPEDS; and 

(ii) One or both of the following— 

(A) Philanthropic organizations that 

are located in, or that provide funding 

in, the State; or 

(B) Private corporations that are 

located in, or that do business in, the 

State. 

(c) Nothing in this part shall be 

interpreted as limiting a State or other 

member of a partnership from 

expending funds to support the 

activities of a partnership under this 

subpart that are in addition to the funds 

matching the Federal allotment. 

(Authority: 20 U.S.C. 1070c–3a) 

How Does the Partnership Select 

Students Under the GAP Program? 

§ 692.120 What are the requirements for 

student eligibility? 

(a) Eligibility. A student is eligible to 

receive a LEAP Grant under GAP if the 

student— 

(1) Meets the relevant eligibility 

requirements contained in 34 CFR 

668.32; 

(2) Has graduated from secondary 

school or, for a home-schooled student, 

has completed a secondary education; 

(3)(i) Has received, or is receiving, a 

LEAP Grant under GAP for each year 

the student remains eligible for 

assistance under this subpart; or 

(ii) Meets at least two of the following 

criteria— 

(A) As designated by the State, either 

has an EFC equal to zero, as determined 


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under part F of the HEA, or a 

comparable alternative based on the 

State’s approved criteria for the LEAP 

Program under subpart A of this part; 

(B) Qualifies for the State’s maximum 

undergraduate award for LEAP Grants 

under subpart A of this part in the 

award year in which the student is 

receiving an additional LEAP Grant 

under GAP; or 

(C) Is participating in, or has 

participated in, a Federal, State, 

institutional, or community early 

information and intervention, 

mentoring, or outreach program, as 

determined by the State agency 

administering the programs under this 

part; and 

(4) Any additional requirements that 

the State may require for receipt of a 

LEAP Grant under GAP. 

(b) Priority. In awarding LEAP Grants 

under GAP, a State shall give priority to 

students meeting all the criteria in 

paragraph (a)(3)(i) of this section. 

(c) Duration of eligibility. (1) A 

student may receive a LEAP Grant 

under GAP if the student continues to 

demonstrate that he or she is financially 

eligible by meeting the provisions of 

paragraph (a)(3)(ii)(A) or (B) of this 

section. 

(2) A State may impose reasonable 

time limits to degree completion. 

(Authority: 20 U.S.C. 1070c–3a) 

How Does the Secretary Approve a 

Waiver of Program Requirements? 

§ 692.130 How does a participating 

institution request a waiver of program 

requirements? 

(a) The Secretary may grant, upon the 

request of an institution participating in 

a partnership that meets the 

requirements of § 692.113(b)(2), a 

waiver for the institution from statutory 

or regulatory requirements that inhibit 

the ability of the institution to 

successfully and efficiently participate 

in the activities of the partnership. 

(b) An institution must submit a 

request for a waiver through the State 

agency administering the partnership. 

(c) The State agency must forward to 

the Secretary, in a timely manner, the 

request made by the institution and may 

include any additional information or 

recommendations that it deems 

appropriate for the Secretary’s 

consideration. 

(Authority: 20 U.S.C. 1070c–3a) 

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[FR Doc. E9–25373 Filed 10–28–09; 8:45 am] 

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