The Department of Education and negotiators representing higher education interests reached a final agreement on proposed regulations for the TEACH Grant program on Thursday.

Department officials and negotiators described the TEACH Grant negotiated rulemaking (negreg) process as a model for how negreg should work.

"This is a good example of how negotiated rulemaking should work," said Diane Jones, the Department's assistant secretary for postsecondary education. She praised negotiators and Department staff for their collaboration and making imperfect legislation as workable as possible.

"This was legislation with good intent, but difficulties with implementation," Jones said. "There will be shortcomings and problems, but we don't always have the luxury to design the perfect program."

She noted that Department staff and negotiators had made the most of the legislation given the constraints of the negreg process.

Negotiators returned Jones' compliments, thanking the Department for their flexibility and willingness to change language due to negotiators' concerns.

Department officials said they expect to issue a Notice of Proposed Rulemaking (NPRM) with the regulatory language negotiators had agreed to in Federal Register by mid-March. The public will then be allowed to comment on the proposed rules before final regulations are issued.

NASFAA will provide the final proposed regulatory language and a summary of the language when it is available. NASFAA will also seek member input before it submit's comments to the NPRM.

During the final days of TEACH Grant negreg negotiators discussed the following issues:

Elementary, secondary school academic year definition

Negotiators did not dissent to the Department's definition, but remained concerned that the definition did not include summer sessions.

The Department declined to change the definition because the current definition is consistent with the definition in the teacher loan forgiveness program. Changing it would make it inconsistent and possibly allow TEACH recipients to complete their service obligation in less than four years, which is against the language in the law, according to Department officials. The Department also noted that including summer sessions would difficult because it would be impossible to determine if the teacher was teaching full-time during the summer program.

Negotiators asked the department to remove the word "consecutive" from the definition because including the word might disqualify service by teachers at year-round schools who get a month off from time to time instead of three months during the summer. The Department said it has not had issues with this in other programs so it was not inclined to take out "consecutive." However, they agreed to add some language in the preamble to clarify this point.

Suspension of the eight-year period to complete the service agreement

The Department added language allowing National Guard members who are called to service to suspend the eight-year period while serving. for members of the National

The Department also added the specific instances under Family Medical Leave Act (FMLA) that allow for a suspension. These include:

• Birth of a child
• Adoption
• Care for family member with serious health condition
• Serious health condition

Department negotiators argued that combined with the eight years provided by the law, the regulations would give a total 11 years to complete the service obligation and that was sufficient.

Negotiators also argued that the proposed regulations were inconsistent because a student taking an initial TEACH Grant program could take up to 12 years to finish, but for their second program they could only have three years before their suspension ended.

Obligation to repay grant

The Department redrafted the language in this section to make it clear that once a recipient's grant turns to a loan they are eligible for all the benefits under the direct loan program, except the six month grace period after graduation.

Negotiators expressed concern that a student with loans and with TEACH Grants that turned into loans would have to begin repaying the TEACH Grants that turned to loans immediately, but would have a six-month grace period for their other loans.

Department officials explained that they could not change this because the regulations have to be cost neutral and there were budget concerns about allowing a grace period.

Numeric GPA equivalent for pass/fail

In response to negotiators' concerns, the Department added language from ACG/SMART Grant regulations that allows schools to have a system for determining a numeric GPA equivalent for pass/fail grades to determine a students GPA eligibility for TEACH.

Frequency of payment

The Department added language to clarify that a student can receive retroactive disbursement for prior payment periods within the same award year as long as they are eligible and sign the service agreement before the disbursement.

Counseling

Negotiators convinced the Department to redraft the language because the language made it impossible for schools to comply by provide counseling within 30 days that a student left a program in certain cases. Negotiators said that, in some cases they might no know a students has withdrawn for up to 90 days or longer in some cases.

The Department reworded this section to allow institutions to provide counseling within 30 days after learning that the recipient has withdrawn from school, withdrawn from TEACH-eligible program or failed to complete exit counseling.

Have to exit counsel students that withdraw from teach eligible program, but not necessarily withdrawn from the institution.

Negotiators reluctantly agreed to the updated language noting that it would be a big administrative burden for institutions.

"There is a huge admin burden, but that is unfortunately the nature of the TEACH program," one negotiator commented.

By Haley Chitty
NASFAA Assistant Director for Communications

Posted 02/08/08 to www.NASFAA.org. Redistribution to non-NASFAA institutions is prohibited. Please submit Web Site questions or comments to Web@NASFAA.org.