By Owen Daugherty, NASFAA Staff Reporter
The Department of Education (ED) this month released the final regulations for the Teacher Education Assistance for College and Higher Education (TEACH) Grant program, which stem from a negotiated rulemaking session that began in January 2019.
After the rulemaking session reached consensus in April of 2019 to overhaul the program and implement improvements, ED made few changes to the proposed regulations based on the 46 public comments it received during the comment period that ended on Jan. 10, 2020, including comments from NASFAA.
The proposed regulations prohibited the reversal of the conversion of a TEACH Grant to a loan if the grant recipient had requested the conversion. Upon reviewing public comments, ED reversed itself in the final rules, allowing a TEACH Grant converted to a loan to be changed back if there “is sufficient time remaining for the grant recipient to complete the required four academic years of qualifying teaching service within eight years from the date the grant recipient ceased enrollment at the institution where the recipient received the grant.”
For a requested conversion where the student received a TEACH Grant at one institution then transferred to another institution and enrolled in another TEACH Grant-eligible program within eight years of ceasing enrollment at the first institution, they are then eligible to reverse the conversion.
ED then made conforming amendments to the TEACH counseling requirements, removing language stating that the conversion of a TEACH Grant to a loan cannot be reversed if the grant recipient requested the conversion.
ED previously came under fire for erroneously converting TEACH Grants to loans, and during negotiated rulemaking the group approved recommendations related to a timeline for grant-to-loan conversions, an appeals process for grant conversions, methods to increase program transparency for grant recipients, and expanded opportunities for grant recipients to finish their teaching requirements, all of which are reflected in the final regulations.
Another change made to the final regulations reflecting public comments was that ED will now automatically provide a “statement of error” to grant recipients when a grant that was incorrectly converted is reconverted to a TEACH Grant, as opposed to a request being necessary.
Changes were also made to the obligation period when a grant is incorrectly in loan status. After reconverting an erroneously converted loan to a TEACH Grant, ED will apply any full academic years of qualifying teaching that the recipient completed during the period when the grant was incorrectly in loan status toward the grant recipient’s four-year service obligation requirement.
Additionally, the grant recipient will be given an additional period of time to complete the remaining portion of the service obligation equal to eight years, minus the number of full academic years of qualifying teaching that the recipient completed prior to the correction of the erroneous conversion.
The final regulations also clarified a handful of lingering confusions, including that grant recipients may satisfy the TEACH Grant service obligation by teaching for an educational service agency that serves low-income students and clearly stating the beginning date of the eight-year period for completing the TEACH Grant service obligation.
NASFAA published a detailed analysis of the proposed improvements that were the result of the negotiated rulemaking committee’s recommendations.
Per master calendar requirements, the final rules are effective on July 1, 2021. However, ED has designated the TEACH final rules for early implementation as of the date of publication, Aug. 14, 2020. ED will implement the regulations as soon as possible and will publish a separate notice announcing the timing of the implementation.
These new rules codify many of the operational changes that ED had already implemented in early 2019 that allowed for a reconsideration process if an applicant felt their grant was erroneously converted to a loan.
Publication Date: 8/27/2020