Federal Updates

Congress approves ECASLA extension

Congress has approved H.R. 6889, which extends through the 2009-10 academic year the loan purchase commitment program and loan participation purchase program authorized under the Ensuring Continued Access to Student Loans Act (ECASLA).

Specifically, under H.R. 6889, the loan purchase programs are extended to cover loans first disbursed prior to July 1, 2010. H.R. 6889 also extends the authority of guarantors to function as lenders of last resort on a school-wide basis through June 30, 2010. The bill has been sent to the president for his signature.

For more information
For background information on the loan purchase programs under ECASLA, see Shoptalk Online editions 456 and 461. To access the text of H.R. 6889, go to THOMAS, the U.S. Congress website, at http://thomas.loc.gov. In the space for "Search Bill Text," enter "H.R. 6889," click on "Bill Number," and then "Search."

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Reauthorization: Consumer information and disclosures

This week, we continue in our series of articles focusing on the details of select provisions of the Higher Education Opportunity Act (HEOA), the legislation that amends and extends the Higher Education Act of 1965 (HEA). In this article we will provide a high-level overview of the changes in the types of information that a school must provide to its prospective students, current students, and/or borrowers. We encourage the community to read about these provisions in the HEA, as the law addresses additional disclosures to be made to other parties, possible exceptions to the requirements, and details that will be crucial to schools in planning how to address these changes.

Remember that most of the changes in the HEOA were effective upon enactment — August 14, 2008. Although we are awaiting further guidance from ED in the form of a Dear Colleague Letter and, eventually, new regulations, in the interim, all affected entities are responsible for taking the steps necessary to comply as quickly as possible. Any exceptions to the effective date are noted in the applicable sections below.

General consumer information requirements
General consumer information provided to prospective and enrolled students — as described in HEA Title IV, Part G, Section 485 — must now include (in addition to previous consumer requirements):

• Any plans the school has made for improving its academic program;
• The terms and conditions of FFELP, Direct, and Perkins loans — this replaces the previous requirement to provide only information about deferment and cancellation options available to borrowers in the Peace Corp or VISTA programs;
• School policies and sanctions related to copyright infringement, including unauthorized peer-to-peer file sharing;
• The school's student body diversity, including information on the percentage of enrolled, full-time students who are male or female; who receive a Pell grant; and who are a self-identified member of a major racial or ethnic group;
• Employment statistics for graduates of the school's degree or certificate programs, based on such sources as alumni surveys, student satisfaction surveys, the National Survey of Student Engagement, the Community College Survey of Student Engagement, and state data systems;
• The types of graduate and professional programs in which the school's graduates have enrolled — gathered from the same sources as above;
• For schools with on-campus housing, an annual report to the campus regarding all fires in on-campus student housing facilities, as well as a fire safety report prepared by the school that includes, among other items:
  • Fire-related statistics, which must also be reported to ED;
  • A description of each student housing facility fire safety system;
  • The number of regular mandatory supervised fire drills; and
  • Policies or rules on fire hazards, procedures for evacuation, and policies regarding fire safety education and training programs provided to students, faculty, and staff;
• School policies regarding vaccinations;
• The retention rate of certificate, or degree-seeking, first-time, full-time, undergraduate students;
• Information regarding immediate emergency response and evacuation policies and procedures;
• For schools with on-campus housing, a missing persons policy that:
  • Permits on-campus students to register confidential contact information, notifies school staff when a resident has been missing for more than 24 hours, and immediately refers official missing person reports to the school's police or campus security department;
  • Informs the student's registered contact, custodial parent or legal guardian, or the appropriate law enforcement agency, if the student has been missing for more than 24 hours; and
  • Informs each resident student of the actions that will be taken if the student is missing for 24 hours;
• A separate, clear, and conspicuous written notice explaining the effect of drug convictions on Title IV eligibility to students when they enroll at the institution and again if they lose eligibility due to a drug conviction;
• Credit transfer policies, including the criteria involved in evaluating the transfer of credit from another school, and the schools with which it has established an articulation agreement;

Graduation and completion rates must now be disaggregated according to several categories such as by gender, by major racial and ethnic subgroup, and by recipients of various types of federal student aid. In calculating the rates, a school is permitted to exclude certain periods of non-enrollment from the calculations — rather than excluding those students from the calculations — if students in those activities represent 20 percent or more of the school's certificate or degree-seeking, full-time, undergraduate students. These changes also apply to graduation and completion rates reported in athletically-related aid disclosures.

For the purpose of campus security and crime statistics, the category of hate crimes is broadened to include larceny-theft; simple assault; intimidation; and destruction, damage, or vandalism of property.

The HEOA made numerous changes to the information that must be provided to borrowers in entrance and exit counseling materials. See Shoptalk Online edition 471 for a detailed analysis of those changes.

Other new disclosure requirements
To allow and encourage students to compare pricing for course materials, a school will be required to provide certain textbook information (per HEA Title I, Part C, Section 133) to its students, including the following:

• If a school uses Internet course schedules for pre-registration and registration, it must also provide the required and recommended textbooks and supplemental materials for each course, as well as the International Standard Book Number (ISBN) and retail prices for each of those items;
• If the school also publishes a written course schedule, it must include a notice that such textbook information is available on the school's Internet course schedule; and
• If a school operates or has a contractual relationship with a bookstore, it must provide information to the bookstore, upon request, about the course schedule for the next academic period, and course material and enrollment information for each scheduled course.

Schools must comply with these provisions by July 1, 2010.

Preferred lender lists (HEA Title I, Part E)
These provisions — which are in addition to preferred lender list requirements included in the school code of conduct rules in HEA 487(a)(27) and (h) — apply to schools and school-affiliated organizations that receive any federal funding or assistance and that have an agreement or arrangement under which they recommend, promote, or endorse a lender's FFELP or private education loans.

Under these new rules, the school or school-affiliated organization must include certain information on its website and in all informational materials that discuss education loans, such as the maximum available Title IV grant and loan aid, a notice that the school must process a FFELP loan from any eligible lender the student selects, and applicable Truth in Lending Act disclosures for private loans.

Additionally, for private loans, a school must:

• Provide prospective private loan borrowers with Truth in Lending Act information, notify the prospective borrower of the availability of Title IV aid that may have more favorable terms, and also ensure that any private education loan information provided is distinct from Title IV loan information;
• Prohibit the use of the school or school-affiliated organization's name, emblem, logo, or mascot, to market private education loans in a manner that implies the loan is offered or made by the school or school-affiliated organization; and
• Display the lender's name in all information and documentation related to the loan.

A school with a preferred lender list must also:

• Provide additional loan information on a disclosure form — to be developed by ED in collaboration with schools, students, families, and the financial aid community — in a timely manner in order to allow students and parents to make informed decisions;
• Prepare annual reports for ED, students, and the public, containing required disclosures and explaining the benefits for students of the preferred lender arrangements; and
• Publish its code of conduct — new requirement in Title IV — on its website and annually inform affected school personnel of the code.

Information to be reported on the Integrated Postsecondary Education Data System (IPEDS)
In order to fulfill with the HEOA requirements regarding school information to be provided on ED's College Navigator website, the National Center for Education Statistics will make a number of mandatory changes to the IPEDS data collection for 2008-09. Updated Institutional Characteristics (IC) forms, upload specifications, and instructions will be available on the IPEDS website.

For more information
For general information about the HEOA, and an outline of the steps ED will take to assist the community in understanding and implementing this new legislation, see ED's HEOA website at www.ed.gov/policy/highered/leg/hea08/index.html.

You may download integrated versions of HEA Title I, Title IV, and Title X from TG Online at www.tgslc.org/policy/hea.cfm.

For questions, contact TG customer assistance at (800) 845-6267, or send an message to cust.assist@tgslc.org.

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