TEACH Grant Neg Reg Subcommittee Finalizes Recommendations for Full Committee

By Allie Arcese, Sr. Director of Strategic Communications & Engagement

By Allie Bidwell, NASFAA Senior Reporter

A subcommittee of negotiators tasked with rewriting federal regulations related to the Teacher Education Assistance for College and Higher Education (TEACH) Grant program convened for its second two-day session last week. The group, which will present its recommendations to the larger negotiated rulemaking committee this week, discussed developing a timeline for touch points between aid offices and grant recipients, proposed counseling requirements, and other central issues.

The subcommittee focused on communication to grant recipients prior to when a grant would be converted into a loan, and when recipients would have time to submit documentation should they choose to dispute a forthcoming conversion. The program and the Department of Education (ED) have come under fire recently for erroneous grant-to-loan conversions.

ED officials returned to the second session with a revised section for the scope and purpose of the regulations, taking into account feedback from the group related to adding language to include the institution the student transferred to and completed the program. The changes also incorporated language to the end of the section stating that the student is required to repay the amount of the grant, with interest, in the form of a loan if the student does not satisfy the service requirements—unless the grant was determined to have been converted in error.

During the first day, the group spent a significant amount of time discussing at what point and under what circumstances the 8-year time period to complete the service obligation would be reset, and how to write regulatory language that would reflect how students who stop-out and re-enroll would be treated with regard to the time they have to complete their service obligation. Many subcommittee members emphasized that they wanted to avoid putting students in a situation in which their first TEACH Grants would convert to loans before they had the chance to re-enroll and complete their programs, or leave them with insufficient time to complete the service obligation after stopping out and re-enrolling.

The group on the second day of negotiations also discussed adding language giving ED the ability to, on a case-by-case basis, extend a temporary suspension to grant recipients for a period for completing the service obligation if it is determined that the recipient could not complete a full academic year of teaching or begin a new year of teaching due to exceptional circumstances significantly affecting the operations of the school or educational service agency, or the recipient’s ability to teach.

In an effort to enhance and streamline communication between ED and grant recipients, the group outlined a list of items ED would communicate annually to grant recipients, such as the terms and conditions needed to satisfy the service obligation, the requirement for the recipient to provide documentation at the completion of each service year, the conditions under which the recipient could request a temporary suspension of the period for completing the service obligation, and more. ED would also annually notify the recipient of the option to request to convert the grant into a loan, and emphasize that the recipient should keep documentation of the submission of their service completion each year for their own records.

The subcommittee also made changes to regulatory language related to conversion counseling grant recipients would receive from ED in the case that their grants are converted to loans. The counseling would be conducted electronically and by mailing written materials to the recipient. Among other things, the counseling would entail informing the borrower of the anticipated monthly payment, provide information on the effects of loan consolidation, debt-management strategies, the availability of Public Service Loan Forgiveness and teacher loan forgiveness, and information regarding the reconsideration process for loan conversion.

After reviewing the subcommittee recommendations, if the full committee feels more work needs to be done, the subcommittee will reconvene next month from March 11-12.


Publication Date: 2/19/2019

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