U.S. Department of Education Federal Update, 8:30 - 10:00 a.m.

By Allie Bidwell, NASFAA Senior Reporter

Officials from the Department of Education (ED) kicked off the third day of the 2018 National Conference with an update on federal higher education policy and regulations.

During the Tuesday morning session, ED’s Kathleen Smith, Lynn Mahaffie, Craig Munier, and Cynthia Hammond discussed a range of topics from federal appropriations for student aid and Pell Grant awards to forthcoming regulations on borrower defense and gainful employment. Smith, deputy chief operating officer at Federal Student Aid (FSA), also stressed the fact that the Trump administration’s recent proposal to merge ED and the Department of Labor is simply a proposal, but an idea worth discussing. She commended NASFAA members for their continued work to serve students.

“What you see that sometimes we forget, being in our bubble, is you get to see the direct impact of your work,” Smith said. “We may not always agree … but if we hold onto the fact that what we do impacts real lives and makes real, impactful change for human beings, we’re going to be okay.”

Mahaffie reviewed current regulatory review efforts within ED, noting the agency has identified nearly 400 outdated Dear Colleague Letters that could be removed. ED will not, however, remove the letters, as officials determined there are “historical reasons” financial aid professionals might need copies of the documents. Instead, the outdated letters have been marked as historical records “so it’s clear institutions don’t need to comply with them,” Mahaffie said.

She went on to give an overview of forthcoming proposed regulations for borrower defense and gainful employment. The implementation of the two regulations were delayed, and the rules went through a new series of negotiated rulemaking sessions, with neither negotiating committee reaching a consensus. ED had previously said that the Notice of Proposed Rulemaking (NPRM) for borrower defense would be released by the end of May, and the gainful employment NPRM released before the end of June. So far, neither has been released, but Mahaffie said ED hopes to release them soon.

Mahaffie also noted that ED has proposed to delay the state authorization rule until July 1, 2020. ED has received about 40 “substantive comments” on the proposed delay that it is reviewing. ED hopes to publish the final regulation delaying state authorization by the end of this week, Mahaffie said.

Munier, an assistant director of policy liaison and implementation at FSA and a past NASFAA National Chair, gave an overview of the fiscal year 2018 omnibus spending bill signed by President Donald Trump in March 2018. The bill included several unexpected victories for student aid programs and policies, including an increase to the maximum Pell Grant and an immediate fix for schools looking to share FAFSA data with authorized scholarship providers. This bill provided an overall increase of $3.9 billion for ED.

Hammond delivered information on the wind-down of the Perkins Loan Program, reminding attendees that institutions may no longer award Perkins loans to graduate students, and may no longer award new Perkins loans to undergraduates since Sept. 30, 2017. Institutions cannot make subsequent disbursements to undergraduates after June 30, 2018.

ED will begin collecting the federal share of Perkins revolving funds after the submission of the FISAP due on Oct. 1, 2018, Hammond said. She added that while schools are not required to liquidate their Perkins portfolios, if they choose to do so, they should submit an intent to liquidate to ED through the COD system for Campus-Based programs.

Attendees will hear more from ED on a timeline for the mobile FAFSA pilot program, year-round Pell Grants, and cybersecurity in subsequent sessions on Tuesday.


Publication Date: 6/26/2018

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