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Federal Updates




Shoptalk Online 445, March 11, 2008
 

Federal Updates

from ED solicits input on student loan issues

ED announced in the March 4, 2008, Federal Register that it would soon be sending messages to approximately 4,500 financial aid administrators at schools participating in the FFELP. This will:

  • Advise schools that ED is monitoring the current credit environment and the potential impact on the student loan programs
  • Invite the aid administrator to relay to ED any information of which the administrator is aware, regarding lenders that are planning to modify their participation in federal or non-federal student loan programs

ED will use the responses to prepare a report for the Secretary of Education, which will in turn be used in decisions ED makes related to "ensuring the continued availability of educational loans for students and their families."

This is a follow-up to a letter the Secretary mailed on February 27 to the presidents of schools participating in the FFELP, which may be viewed online at www.ed.gov/policy/highered/guid/secletter/080227.html.

For more information
The Federal Register announcement is available online at http://a257.g.akamaitech.net/7/257/2422/01jan20081800/edocket.access.gpo.gov/2008/pdf/E8-4113.pdf.

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Encouraging innovation in verification: ED's Quality Assurance Program

After spending too many hours staring at tax returns and verification worksheets, have you ever wished you could make up your own rules for verification? Well, ED is offering you the chance to do that — within limits, of course. Last week, ED published a notice in the Federal Register announcing it will begin accepting applications for participation in the Quality Assurance Program (QAP).

QAP — which began as a pilot program in 1985 and now includes more than 150 school participants — allows a school to develop institutional verification processes. These processes may be more specifically tailored to the characteristics and needs of the school's own student population, in lieu of the traditional federal verification processes. QAP schools measure their performance and test the effectiveness of their verification program by using ED's ISIR Analysis Tool.

The goal of the QAP is to reduce improper payments in the Pell Grant Program. To that end, ED's preliminary analysis of 2005-06 data demonstrates that the verification criteria established by QAP schools prevented a total of over $50 million in improper Pell grant payments. Another benefit of the program is the partnership between ED and the participating schools: As both parties become engaged in promoting continuous improvement in the administration and delivery of federal financial aid, service to students and families is improved.

How to apply
Schools that administer one or more Title IV programs may submit a letter of application to ED to participate in the QAP; schools that currently participate in the program may continue to do so without submitting a new letter of application. ED will review the letter of application to determine if the school meets general Title IV eligibility requirements and has a demonstrated record of program compliance. Other factors ED may consider include the school's performance with regard to financial responsibility, its administrative capability, program review findings, and audit findings.

For more information
The Federal Register notice, including detailed application instructions, is available online at http://ifap.ed.gov/fregisters/FR022620081.html. For general information about the QAP, including a list of currently participating schools, data analysis reports, and ED contact information, please visit ED's QAP website at http://www.ifap.ed.gov/qahome/Default.html.

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Stafford MPN extended

The current Stafford Loan Master Promissory Note (Stafford MPN) was scheduled to expire on February 29, 2008. However, ED has received a notice from the Office of Management (OMB) approving an extension of the current form, to May 31, 2008.

FFELP participants may continue to use the current form until such time as the revised Stafford MPN is approved. Shoptalk Online will announce the revised form when it is available.

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