By a vote of 216-214, the House of Representatives on Wednesday approved S. 1932, The Deficit Reduction Act of 2005, clearing the reconciliation bill for the President's signature. The legislation will significantly affect your students, your school, and your office operations.
A number of the bill's provisions take effect next year and in future years. A few of the provisions take effect on the date President Bush signs S. 1932. A larger number take effect on July 1 of this year or on another date this year. A number of these provisions are purely statutory in nature and, therefore, are self-executing and would not necessarily be an administrative concern, but could be a counseling concern, especially in updating consumer information publications, Web sites, brochures, etc. There also may be concerns related to the reconfiguration of management systems.
There are other changes taking effect July 1 that appear to be subject to the negotiated rulemaking process. However, to complete that full negotiating process and issue regulations before the start of the next academic year would be difficult. This leads to another complicating factor: the statutory master calendar requires that final rules be published by November 1 preceding the award year for which they take effect.
To make matters worse, there are a number of changes that affect the current processing of student aid which, as you well know, is well under way.
As a result of these complications, there are a lot of questions to be answered and those answers may not become known as quickly as we may wish. NASFAA is currently engaged in internal and external discussions concerning these matters and we certainly will be advising you as soon as we learn of decisions and processes implementing this law.
NASFAA has prepared a document that highlights a number of the changes made by S. 1932. Staff are working on a side-by-side comparison of the legislative language among the reauthorization and reconciliation bills. Staff are also preparing a more comprehensive report explaining the provisions of the bill in more detail. Both documents will be available soon.
While the reconciliation bill takes care of a number of HEA reauthorization matters, a large number of reauthorization statutory provisions still need to be approved. The current HEA extension expires on March 31, 2006.
Background
Although the House voted in favor of the bill just before Christmas, the Senate changed the bill slightly forcing the House to pass the bill again with the minor Senate changes. President Bush is expected to sign the bill into law in the near future. The reconciliation bill includes $12.7 billion in net savings over five years achieved through changes to the student loan programs, which is almost one-third of S. 1932's total savings for deficit reduction.
NASFAA President Dallas Martin recently asked members to contact their House delegations to urge them to vote against the bill and we thank all of you who have done so. NASFAA has long held the position that any Title IV student aid program budget savings, especially reconciliation savings, should be reinvested into better student loan benefits and increased grant assistance.
By Larry Zaglaniczny
NASFAA Director for Congressional Relations
Posted February 2, 2006 on www.NASFAA.org, the Web Site of the
National Association of Student Financial Aid Administrators (NASFAA).
Copyright 2006. Redistribution to non-NASFAA institutions is prohibited
Please submit Web Site questions or comments to web@NASFAA.org
