The Teacher Education Assistance for College and Higher Education (TEACH) Grant Program and Other Federal Student Aid Programs, 15336-15374 [E8-5196]

Agencies

• DEPARTMENT OF EDUCATION

[Federal Register Volume 73, Number 56 (Friday, March 21, 2008)]
[Proposed Rules]
[Pages 15336-15374]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E8-5196]



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Part III





Department of Education





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34 CFR Parts 668, 673, 674, et al.



The Teacher Education Assistance for College and Higher Education 
(TEACH) Grant Program and Other Federal Student Aid Programs; Proposed 
Rule

Federal Register / Vol. 73, No. 56 / Friday, March 21, 2008 / 
Proposed Rules

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DEPARTMENT OF EDUCATION

34 CFR Parts 668, 673, 674, 675, 676, 682, 685, 686, and 690

RIN 1840-AC93
[Docket ID ED-2008-OPE-0001]


The Teacher Education Assistance for College and Higher Education 
(TEACH) Grant Program and Other Federal Student Aid Programs

AGENCY: Office of Postsecondary Education, Department of Education.

ACTION: Notice of proposed rulemaking.

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SUMMARY: The Secretary proposes to amend title 34 of the Code of 
Federal Regulations to establish regulations for the Teacher Education 
Assistance for College and Higher Education (TEACH) Grant Program. The 
TEACH Grant program is a non-need-based grant program that provides up 
to $4,000 per year to students who are enrolled in an eligible program 
and who agree to teach in a high-need field, at a low-income elementary 
or secondary school for at least four years within eight years of 
completing the program for which the TEACH Grant was awarded. If the 
grant recipient fails to complete the required teaching service, the 
TEACH grant is treated as a Federal Direct Unsubsidized Stafford Loan 
(Federal Direct Unsubsidized Loan). The Secretary also proposes to 
amend the regulations related to the Student Assistance General 
Provisions; the General Provisions for the Federal Perkins Loan 
Program, the Federal Work-Study Program, the Federal Supplemental 
Educational Opportunity Grant Program; the Federal Perkins Loan 
Program; the Federal Work-Study Programs; the Federal Supplemental 
Educational Opportunity Grant Program; the Federal Family Education 
Loan (FFEL) Program; the William D. Ford Federal Direct Loan Program; 
and the Federal Pell Grant Program to implement the TEACH Grant 
Program. These proposed regulations are needed to implement provisions 
of the Higher Education Act of 1965 (HEA), as amended by the College 
Cost Reduction and Access Act of 2007 (CCRAA).

DATES: We must receive your comments on or before April 21, 2008.

ADDRESSES: Submit your comments through the Federal eRulemaking Portal 
or via postal mail, commercial delivery, or hand delivery. We will not 
accept comments by fax or by e-mail. Please submit your comments only 
one time, in order to ensure that we do not receive duplicate copies. 
In addition, please include the Docket ID at the top of your comments.
     Federal eRulemaking Portal: Go to https://
www.regulations.gov to submit your comments electronically. Information 
on using Regulations.gov, including instructions for accessing agency 
documents, submitting comments, and viewing the docket, is available on 
the site under ``How To Use This Site.''
     Postal Mail, Commercial Delivery, or Hand Delivery. If you 
mail or deliver your comments about these proposed regulations, address 
them to Michelle Belton, U.S. Department of Education, 1990 K Street, 
NW., room 8031, Washington, DC 20006-8502.

    Privacy Note: The Department's policy for comments received from 
members of the public (including those comments submitted by mail, 
commercial delivery, or hand delivery) is to make these submissions 
available for public viewing on the Federal eRulemaking Portal at 
https://www.regulations.gov. All submissions will be posted to the 
Federal eRulemaking Portal without change, including personal 
identifiers and contact information.


FOR FURTHER INFORMATION CONTACT: Michelle Belton, U.S. Department of 
Education, 1990 K Street, NW., room 8031, Washington, DC 20006-8502. 
Telephone: (202) 502-7821 or via the Internet at: 
Michelle.Belton@ed.gov.
    If you use a telecommunications device for the deaf, call the 
Federal Relay Service (FRS), toll free, at 1-800-877-8339.
    Individuals with disabilities can obtain this document in an 
alternative format (e.g., Braille, large print, audiotape, or computer 
diskette) on request to the contact person listed under FOR FURTHER 
INFORMATION CONTACT.

SUPPLEMENTARY INFORMATION: 

Invitation To Comment

    As outlined in the section of this notice entitled ``Negotiated 
Rulemaking,'' significant public participation, through three public 
hearings and three negotiated rulemaking sessions, has occurred in 
developing this notice of proposed rulemaking (NPRM). Therefore, in 
accordance with the requirements of the Administrative Procedure Act, 
the Department invites you to submit comments regarding these proposed 
regulations on or before April 21, 2008. To ensure that your comments 
have maximum effect in developing the final regulations, we urge you to 
identify clearly the specific section or sections of the proposed 
regulations that each of your comments addresses and to arrange your 
comments in the same order as the proposed regulations.
    We invite you to assist us in complying with the specific 
requirements of Executive Order 12866, including its overall 
requirements to assess both the costs and the benefits of the intended 
regulation and feasible alternatives, and to make a reasoned 
determination that the benefits of this intended regulation justify its 
costs. Please let us know of any further opportunities we should take 
to reduce potential costs or increase potential benefits while 
preserving the effective and efficient administration of the programs.
    During and after the comment period, you may inspect all public 
comments about these proposed regulations by accessing Regulations.gov. 
You may also inspect the comments, in person, in room 8031, 1990 K 
Street, NW., Washington, DC, between the hours of 8:30 a.m. and 4 p.m., 
Eastern time, Monday through Friday of each week except Federal 
holidays.

Assistance to Individuals With Disabilities in Reviewing the Rulemaking 
Record

    On request, we will supply an appropriate aid, such as a reader or 
print magnifier, to an individual with a disability who needs 
assistance to review the comments or other documents in the public 
rulemaking record for these proposed regulations. If you want to 
schedule an appointment for this type of aid, please contact the person 
listed under FOR FURTHER INFORMATION CONTACT.

Negotiated Rulemaking

    Section 492 of the HEA requires the Secretary, before publishing 
any proposed regulations for programs authorized by Title IV of the 
HEA, to obtain public involvement in the development of the proposed 
regulations. After obtaining advice and recommendations from the 
public, including individuals and representatives of groups involved in 
the Federal student financial assistance programs, the Secretary must 
subject the proposed regulations to a negotiated rulemaking process. 
All proposed regulations that the Department publishes on which the 
negotiators reached consensus must conform to final agreements 
resulting from that process unless the Secretary reopens the process or 
provides a written explanation to the participants stating why the 
Secretary has decided to depart from the agreements. Further 
information on the negotiated rulemaking process can be found at:

[[Page 15337]]

https://www.ed.gov/policy/highered/reg/hearulemaking/2008/
index2008.html.
    On October 22, 2007, the Department published a notice in the 
Federal Register (72 FR 59494) announcing our intent to establish up to 
two negotiated rulemaking committees to prepare proposed regulations. 
One committee would focus on issues related to the new TEACH Grant 
program (TEACH Grant Committee). A second committee would address 
Federal student loans. The notice requested nominations of individuals 
for membership on the committees who could represent the interests of 
key stakeholder constituencies on each committee. The TEACH Grant 
Committee met to develop proposed regulations twice during the month of 
January, 2008 and once in early February, 2008. This NPRM proposes 
regulations relating to the administration of the TEACH Grant program.
    The Department developed a list of proposed regulatory provisions 
for the TEACH Grant program from advice and recommendations submitted 
by individuals and organizations in testimony submitted to the 
Department in a series of three public hearings held on:
     November 2, 2007, at the Sheraton New Orleans, New 
Orleans, Louisiana.
     November 16, 2007, at the U.S. Department of Education in 
Washington, DC.
     November 29, 2007, at the Manchester Grand Hyatt San 
Diego, San Diego, California.
    In addition, the Department accepted written comments on possible 
regulatory provisions submitted directly to the Department by 
interested parties and organizations. A summary of all comments 
received orally and in writing is posted as background material in the 
docket. Transcripts of the regional meetings can be accessed at https://
www.ed.gov/policy/highered/reg/hearulemaking/2008/index2008.html.
    Staff within the Department also identified issues for discussion 
and negotiation.
    At its first meeting, the TEACH Grant Committee reached agreement 
on its protocols and proposed agenda. These protocols provided that the 
non-Federal negotiators would participate in the negotiated rulemaking 
process based on their experience and expertise.
    The TEACH Grant Committee included the following members:
     Dr. Nell Ingram, Dallas Independent School District and 
Judy Corcillo (alternate), National Association for Alternative 
Certification.
     Donna Harris-Aikens, National Education Association and 
James Rice (alternate), Quinsigamond Community College.
     Dr. William H. Graves, III, Darden College of Education, 
Old Dominion University and Dr. J. Roberts Hendricks (alternate), 
College of Education, University of Arizona.
     Dr. Sandra Robinson, College of Education, University of 
Central Florida and Dr. Jane West (alternate), American Association of 
Colleges for Teacher Education.
     Joseph Pettibon, Texas A&M University and Beth Stack 
(alternate), University of Pittsburgh.
     Dr. Herbert Brunkhorst, California State University San 
Bernardino and Janis Lariviere (alternate), Teacher Development Center 
for Science Education, University of Kansas.
     Janet Dodson, Doane College and Bernard A. Pekala, Jr. 
(alternate), Boston College.
     Ellis Salim, Baker College and Maureen Budetti 
(alternate), National Association of Independent Colleges and 
Universities.
     Scott Fleming, Georgetown University and Thomas O'Neill 
(alternate), Association of Independent Colleges and Universities of 
Nebraska.
     Mary Dorrell, Career Education Corporation and Tammy 
Halligan (alternate), Career College Association.
     Patrick Moore, Delaware Technical and Community College.
     Jim Hermes, American Association of Community Colleges and 
Julia Brown (alternate), Northern Virginia Community College.
     Carmen Berkley, United States Student Association and 
Cedric Lawson (alternate), United Council of University of Wisconsin 
Students.
     Terry Hartle, American Council on Education and Cyndy 
Littlefield (alternate), Association of Jesuit Colleges and 
Universities.
     Gail McLarnon, U.S. Department of Education.
    During its meetings, the TEACH Grant Committee reviewed and 
discussed drafts of proposed regulations. At the final meeting in 
February 2008, the TEACH Grant Committee reached consensus on all of 
the proposed regulations in this document. More information on the work 
of the TEACH Grant Committee can be found at: https://www.ed.gov/policy/
highered/reg/hearulemaking/2008/teach.html.
    The Secretary bases these proposed regulations for the TEACH Grant 
program on the regulations of the Federal Pell Grant program or the 
William D. Ford Federal Direct Loan (Direct Loan) program as 
appropriate given the similar nature of these programs. Like the 
Federal Pell Grant program, the TEACH Grant program provides for direct 
grants from the Federal government to students to assist in paying 
their college expenses. However, unlike the Federal Pell Grant program, 
the TEACH Grant program requires grant recipients to complete a service 
obligation consisting of four years of teaching in a high-need field at 
a low-income elementary or secondary school within eight years of 
completing the program of study for which the TEACH Grant was given. If 
a recipient fails to complete this service obligation, the TEACH Grant 
converts to a Federal Direct Unsubsidized Loan.
    Under the proposed regulations, the Secretary would deliver funds 
using the same system as used for the Federal Pell Grant and Direct 
Loan programs. This will allow the coordination of administrative 
requirements and will assist participating institutions in 
administering the program, reduce the institutional administrative 
burden and paperwork, and simplify the application process for 
students. Accordingly, these proposed regulations would include the 
following definitions, without changes, from the Federal Pell Grant 
program regulations in 34 CFR 690.2:

Institutional Student Information Record (ISIR) Payment Data

Student Aid Report (SAR)

    In addition, the substance of proposed Sec. Sec.  686.5, 686.22(a) 
through (f), 686.25, 686.30, 686.33, 686.34, 686.35, 686.36 and 686.38 
reflect the Pell Grant requirements in 34 CFR 690.8, 690.63(a) through 
(f), 690.66, 690.71, 690.76, 690.79, 690.80(a) and (b), 690.81, and 
690.82. We have included these specific Pell Grant requirements in the 
text of the proposed TEACH Grant regulations to provide a complete 
description in part 686 of the program-specific requirements for the 
TEACH Grant program. Other sections of the proposed TEACH Grant program 
regulations reflect the Federal Pell Grant program requirements and the 
William D. Ford Federal Direct Loan program requirements to the extent 
practicable.

Significant Proposed Regulations

    We group major issues according to subject, with appropriate 
sections of the proposed regulations referenced in parenthesis. We 
discuss substantive issues under the sections of the proposed 
regulations to which they pertain.

Late Disbursements (Sec.  668.164(g))

    Statute: The HEA does not specifically address the issue of late 
disbursements of TEACH Grants.

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    Proposed Regulations: Current 34 CFR 668.164(g) allows a student 
who is no longer eligible to receive Title IV, HEA program funds to 
qualify for those funds if certain conditions are satisfied; for 
example, the institution receiving a SAR or an ISIR with an official 
expected family contribution. Current Sec.  668.164(g) also specifies 
the affected programs. The proposed regulations would add the TEACH 
Grant program to the list in Sec.  668.164(g) of programs for which a 
student becomes ineligible when the student is no longer enrolled at 
the institution for the award year. The proposed regulations would also 
describe how TEACH Grant recipients may qualify for a late 
disbursement.
    Reason: For a student to be considered eligible for a late 
disbursement of Title IV aid, the institution must have received a SAR 
or an ISIR with an official expected family contribution (EFC) and must 
originate the award before the student became ineligible. For TEACH 
Grant purposes, ``originate'' means that the student meets the 
eligibility requirements of Sec.  686.11, including signing the service 
agreement.

Calculating and Applying Cohort Default Rates (Sec.  668.183)

    Statute: Section 435(m) of the HEA defines cohort default rate 
calculation procedures.
    Proposed Regulations: We are proposing to amend current 34 CFR 
668.183 to specify that for purposes of calculating an institution's 
cohort default rate, a TEACH Grant that has been converted to a Federal 
Direct Unsubsidized Loan is not included.
    Reason: In the case of a student whose TEACH Grant is converted to 
a Federal Direct Unsubsidized Loan and who defaults on that loan, the 
Secretary does not believe that the loan should be included in the 
institution's cohort default rate calculation. The TEACH Grant award is 
originally made to the student as a grant and converts to a loan only 
after the student takes (or fails to take) certain actions. This 
conversion may occur many years after the award is made. Including the 
loan in the calculation of the rate at this stage in the process would 
not serve the purposes of the cohort default rate. The cohort default 
rates are a measure of an institution's administrative capability to 
control defaults to the extent the rates are calculated on data 
reasonably related to the period of a student's attendance at an 
institution. The conversion of TEACH Grants to Direct Loans will 
generally occur at a significantly later point in time than would be 
reasonable to include in an institution's cohort default rate.

Overaward (Sec.  673.5)

    Statute: Section 420M(c)(2) of the HEA provides that the TEACH 
Grant, in combination with Federal assistance and other student 
assistance, may not exceed the student's cost of attendance.
    Proposed Regulations: We are proposing to amend current 34 CFR 
673.5(c) to include the amount of any TEACH Grant in the types of funds 
that may be used to replace a student's EFC and to clarify that any 
amount in excess of a student's EFC is considered estimated financial 
assistance.
    Reason: TEACH Grants are not awarded based on need and therefore 
are permitted to replace a student's EFC. As with other forms of aid 
that may replace EFC, any TEACH Grant amount in excess of the EFC is 
considered estimated financial assistance.

Part 686--Teacher Education Assistance for College and Higher Education 
(TEACH) Grant Program

Definitions (Sec.  686.2)

Academic Year or Its Equivalent for Elementary and Secondary Schools 
(Elementary or Secondary Academic Year)

    Statute: Section 420N(b)(1)(A) of the HEA provides that a grant 
recipient must serve as a full-time teacher for a total of not less 
than four academic years within eight years after completing the 
program of study for which he or she received a TEACH grant.
    Proposed Regulations: Proposed Sec.  686.2 would provide a 
definition of academic year or its equivalent for elementary and 
secondary schools (elementary or secondary academic year) for purposes 
of the TEACH Grant program. An academic year for elementary and 
secondary schools would be one complete school year or two complete and 
consecutive half-years from different school years, excluding summer 
sessions, that generally fall within a 12-month period. If a school has 
a year-round program of instruction, the Secretary would consider a 
minimum of nine consecutive months to be the equivalent of an academic 
year.
    Reasons: This proposed definition is adopted from the definition of 
the term ``academic year'' used for purposes of determining teacher 
loan forgiveness in the Federal Family Education Loan (FFEL) program 
regulations in 34 CFR 682.215(b). Using the same definition for the 
TEACH Grant program would ensure equity in that the service performed 
by participants in both of these programs would be calculated in the 
same manner. Several non-Federal negotiators suggested removing the 
word ``consecutive'' from the first paragraph of the definition and 
eliminating the exclusion of summer sessions. The Secretary believes 
that these suggested changes would effectively allow a grant recipient 
to complete the four-year service obligation in less than four years, 
contrary to the TEACH Grant provisions in the statute. The Secretary is 
further concerned that full-time teaching in a summer session is not 
equivalent to full-time teaching in a regular school term.
    Some non-Federal negotiators requested that the term 
``consecutive'' be removed from the second paragraph of the definition, 
which deals with a year-round program of instruction. These negotiators 
expressed concern that, because some year-round calendars punctuate the 
months of instruction with breaks of several weeks in length, year-
round calendars may not technically meet the requirement for a minimum 
of nine consecutive months to be the equivalent of an academic year. 
The Department has decided not to remove the word ``consecutive'' 
because that would make this definition inconsistent with the one used 
for purposes of the teacher loan forgiveness in the FFEL program. That 
definition has been in use for several years without causing any 
difficulties. However, the Secretary would consider nine months of 
full-time teaching within a 12-month period in a year-round program the 
equivalent of an academic year for purposes of the TEACH Grant program.

Annual Award and Scheduled Award

    Statute: Section 420M(a)(1) of the HEA establishes $4,000 as the 
amount a TEACH Grant-eligible student may receive for a year, and 
section 420M(c)(1) of the HEA provides that awards for part-time 
attendance are reduced in proportion to a student's less-than-full-time 
enrollment status.
    Proposed Regulations: Proposed Sec.  686.2 would define the term 
Scheduled Award as the maximum amount of a TEACH Grant that a full-time 
student could receive for a year and the term an annual award as the 
maximum TEACH Grant amount a student would receive for enrolling as a 
full-time, three-quarter-time, half-time, or less-than-half-time 
student and remaining in that enrollment status for a year.
    Reason: These definitions, in conjunction with the provisions of 
subpart C of the proposed regulations (Determination of Awards) would

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ensure compliance with the statutory requirements that a TEACH Grant-
eligible student receive an award of $4,000 for attendance during a 
year and that a student's payments be adjusted based on the student's 
enrollment status during a payment period.

Elementary School

    Statute: Section 420N(b)(1)(A) and (B) of the HEA provides that a 
TEACH Grant recipient must serve as a full-time teacher for a total of 
not less than four academic years within eight years after completing 
the course of study for which he or she received a TEACH Grant in an 
elementary or secondary school that serves low-income students.
    Proposed Regulations: Proposed Sec.  686.2 would provide a 
definition of elementary school for TEACH Grant purposes. The term 
elementary school would be defined as a nonprofit institutional day or 
residential school, including a public elementary charter school, which 
provides elementary education, as determined under State law.
    Reason: This proposed definition, which would implement the 
statutory requirement that a TEACH Grant recipient teach in an 
elementary or secondary school, is from section 9101(18) of the 
Elementary and Secondary Education Act of 1965 (ESEA).

High-Need Field

    Statute: Section 420N(b)(1)(C) of the HEA provides that a grant 
recipient must teach in one of the high-need fields of mathematics, 
science, a foreign language, bilingual education, special education, as 
a reading specialist or in another field documented as high-need by the 
Federal Government, State government, or local educational agency 
(LEA), and approved by the Secretary. Section 420N(a)(2)(B)(i) 
identifies English language acquisition as a high-need field.
    Proposed Regulations: Proposed Sec.  686.2 would define the term 
high-need field for the purposes of the TEACH Grant program. A high-
need field would include bilingual education and English language 
acquisition, foreign language, mathematics, reading specialist, 
science, special education, and any other field documented as high-need 
by the Federal Government, a State government or an LEA, and approved 
by the Secretary and listed in the Department's annual Teacher Shortage 
Area Nationwide Listing (Nationwide List).
    Reason: This proposed definition would implement the statutory 
requirement that, to meet the service obligation, a TEACH Grant 
recipient must teach in a high-need field.

Highly-Qualified

    Statute: Section 420N(b)(1)(E) of the HEA provides that a TEACH 
Grant recipient must comply with the requirements for being a highly-
qualified teacher, as defined in section 9101 of the ESEA.
    Proposed Regulations: Proposed Sec.  686.2 would define the term 
highly-qualified for purposes of the TEACH Grant program. The term 
would have the meaning set forth in section 9101(23) of the ESEA or in 
section 602(10) of the Individuals with Disabilities Education Act 
(IDEA).
    Reason: This proposed definition would implement the statutory 
requirement that a TEACH Grant recipient serve as a highly-qualified 
teacher. The Secretary considers it appropriate to use the definition 
of highly-qualified from the ESEA for teachers in all of the high-need 
fields listed in the HEA with the exception of special education 
teachers. Special education teachers must satisfy the definition of 
highly-qualified in section 602(10) of the IDEA.

Numeric Equivalent

    Statute: Section 420N(a)(2)(A)(ii)(I) of the HEA provides that a 
student may be eligible for a TEACH Grant based, in part, on a grade 
point average (GPA) comparable to a 3.25 average on a 4.0 scale under 
standards prescribed by the Secretary.
    Proposed regulations: Under proposed Sec.  686.11(a)(1)(v), a 
student may be eligible for a TEACH Grant based on a cumulative GPA at 
an institution (or, in the case of a first year student, at a secondary 
school) of at least 3.25 on a 4.0 scale, or the numeric equivalent. We 
are proposing to define the term numeric equivalent, for purposes of 
the TEACH Grant program, in a manner consistent with the definition of 
that term in 34 CFR 691.15(g) of the Academic Competitiveness Grant 
(ACG) program and National Science and Mathematics Access to Retain 
Talent (SMART) Grant program regulations.
    As in the ACG and National SMART Grant programs, to determine a 
numeric equivalent, an institution that has one or more academic 
programs that measure academic performance using alternatives to 
standard numeric grading procedures would be required to develop and 
apply an academically defensible equivalency policy with a numeric 
scale for purposes of determining student eligibility. That equivalency 
policy would need to be in writing and available to students upon 
request. The policy would also need to include clear differentiations 
of student performance to support a determination that a student has 
performed, in his or her TEACH Grant-eligible program, at a level 
commensurate with at least a 3.25 GPA on a 4.0 scale. Generally, a 
grading policy that includes only ``satisfactory/unsatisfactory'', 
``pass/fail'', or other similar nonnumeric assessments would not be a 
numeric equivalent under the proposed regulations. However, such 
assessments would be considered numeric equivalents if the institution 
could demonstrate that the ``pass'' or ``satisfactory'' standard has 
the numeric equivalent of at least a 3.25 GPA on a 4.0 scale, or that a 
student's performance for tests and assignments yielded a numeric 
equivalent of a 3.25 GPA on a 4.0 scale. Under the proposed definition 
of the term numeric equivalent, the institution's equivalency policies 
would need to be consistent with any other standards that the 
institution may have developed for academic and other Title IV, HEA 
program purposes, such as graduate school applications and scholarship 
eligibility, to the extent such standards distinguish among various 
levels of a student's academic performance.
    Reason: During negotiated rulemaking, the non-Federal negotiators 
requested clarification of the term ``numeric equivalent'' as it is 
used to determine comparability to a 3.25 GPA on a 4.0 scale. We agreed 
to incorporate the definition of the term as it is used in the ACG and 
National SMART Grant programs. The ACG and National SMART Grant 
programs have GPA requirements that are similar to those of TEACH 
Grants in that students are required to maintain minimum GPAs to retain 
eligibility for a TEACH Grant. The Department has had a successful 
experience implementing the ACG/National SMART Grant programs' 
definition of ``numeric equivalent,'' and thus believes that this 
definition should be applied to GPA calculations for the TEACH Grant 
program. In addition, maintaining a consistent definition between 
programs minimizes burden for institutions and provides a consistent 
standard between programs.

Post-Baccalaureate Program

    Statute: Section 420L(2) of the HEA defines post-baccalaureate as a 
program of instruction for teacher candidates who have completed a 
baccalaureate degree, that does not lead to a graduate degree, and that 
consists of courses required by a State in order for a teacher 
candidate to receive a professional certification or licensing 
credential that

[[Page 15340]]

is required for employment as a teacher in an elementary school or 
secondary school in that State, but does not include any program of 
instruction offered by a TEACH Grant-eligible institution that offers a 
baccalaureate degree in education.
    Proposed Regulations: Proposed Sec.  686.2 would define the term 
post-baccalaureate program for purposes of the TEACH Grant program 
using the statutory language and stating that a post-baccalaureate 
program would be treated as an undergraduate program for TEACH Grant 
purposes.
    Reason: This proposed definition is necessary to implement the HEA 
and to clarify that the Secretary considers a post-baccalaureate 
program to be an undergraduate program for TEACH Grant purposes.

Retiree

    Statute: Section 420N(2)(B)(i) of the HEA provides that a retiree 
from another occupation with expertise in a field in which there is a 
shortage of teachers who is pursuing a master's degree to prepare to 
teach would be eligible for a TEACH Grant.
    Proposed Regulations: Proposed Sec.  686.2 would define the term 
retiree, for purposes of the TEACH Grant program, as an individual who 
has decided to change his or her occupation for any reason and who has 
expertise, as determined by the institution, in a high-need field.
    Reason: This proposed definition would implement the statutory 
provision specifying that individuals who are seeking a master's degree 
and are retirees from another occupation with expertise in a field in 
which there is a shortage of teachers may be eligible for a TEACH 
Grant.

School Serving Low-Income Students (Low-Income School)

    Statute: Section 420N(b)(1)(B) of the HEA provides that a TEACH 
Grant recipient must agree to teach in a school described in section 
465(a)(2)(A) of the HEA.
    Proposed Regulations: Proposed Sec.  686.2 would define a school 
serving low-income students (low-income school), for purposes of the 
TEACH Grant program, as an elementary or secondary school that is in 
the school district of an LEA that is eligible for assistance pursuant 
to Title I of the ESEA; that has been determined by the Secretary to be 
a school in which more than 30 percent of the school's total enrollment 
is made up of children who qualify for services provided under Title I 
of the ESEA; and that is listed in the Department's Annual Directory of 
Designated Low-Income Schools for Teacher Cancellation Benefits. The 
Secretary would consider all elementary and secondary schools operated 
by the Bureau of Indian Education (BIE) or operated on Indian 
reservations by Indian tribal groups under contract or grant with the 
BIE to qualify as schools serving low-income students.
    Reason: The proposed definition is drawn from section 465(a)(2)(A) 
of the HEA, which provides for loan cancellation for teachers in the 
Federal Perkins Loan Program. The non-Federal negotiators questioned 
whether the designation of a low-income school would be made by the 
school district or by the individual school. As is clearly specified in 
section 465(a)(2)(A) of the HEA, the designation of a low-income school 
is made at the level of the individual school.

Secondary School

    Statute: Section 420N(b)(1)(A) and (B) of the HEA provides that a 
TEACH Grant recipient must serve as a full-time teacher in an 
elementary or secondary school that serves low-income students for a 
total of not less than four academic years within eight years after 
completing the course of study for which he or she received a TEACH 
Grant.
    Proposed Regulations: Proposed Sec.  686.2 would define the term 
secondary school, for TEACH Grant purposes, as a secondary school would 
be a nonprofit institutional day or residential school, including a 
public secondary charter school, that provides secondary education, as 
determined under State law, but does not include any education beyond 
grade 12.
    Reason: This proposed definition, which is taken from section 
9101(38) of the ESEA, would implement the statutory requirement that a 
TEACH Grant recipient teach in an elementary or secondary school.

Service Agreement

    Statute: Section 420N(b) of the HEA provides that each applicant 
for a TEACH Grant must sign an agreement to serve as a full-time 
teacher in a low-income school in a high-need field for a total of not 
less than four academic years within eight years after completing the 
course of study for which the individual received a TEACH Grant, submit 
evidence of such employment in the form of a certification by the chief 
administrative officer of the school upon completion of each year of 
service, and comply with the requirements for being a highly-qualified 
teacher.
    Proposed Regulations: Proposed Sec.  686.2 would define the term 
service agreement, for purposes of the TEACH Grant program, as an 
agreement under which the individual receiving a TEACH Grant commits to 
meet the service obligation described in Sec.  686.12 and to comply 
with the notification requirements and other provisions of the 
agreement.
    Reason: This proposed definition would implement the statutory 
requirement that a service agreement accompany each TEACH Grant 
application.

TEACH Grant-Eligible Institution

    Statute: Section 420L(1) and (2) of the HEA provides that an 
eligible institution for purposes of the TEACH Grant program is an 
institution of higher education as defined in section 102 of the HEA 
that is financially responsible and that provides: High-quality teacher 
preparation and professional development services, including extensive 
clinical experience as part of pre-service preparation; pedagogical 
coursework, or assistance in the provision of such coursework; and 
supervision and support services to teachers, or assistance in the 
provision of such services, or that provides a post-baccalaureate 
program of instruction.
    Proposed Regulations: The proposed definition of TEACH Grant-
eligible institution in Sec.  686.2 would implement the statutory 
requirement that an institution must be financially responsible by 
using the current standards for institutions participating in the Title 
IV HEA programs in 34 CFR part 668, subpart L. Under the proposed 
definition, an institution must meet this financial responsibility 
requirement and provide a high-quality teacher preparation program at 
the baccalaureate or master's degree level that is (1) accredited by a 
specialized accrediting agency recognized by the Secretary for the 
accreditation of professional teacher education programs; or (2) 
approved by a State, includes extensive pre-service clinical 
experience, and provides pedagogical coursework, or the assistance in 
the provision of such coursework. In both cases, the institution must 
provide supervision and support services to teachers or assist in the 
provision of services to teachers.
    Under the proposed definition of TEACH Grant-eligible institution, 
an institution that is financially responsible would also be eligible 
to participate in the TEACH Grant program under any of the following 
conditions:
    (A) The institution offers a post-baccalaureate program but not a

[[Page 15341]]

baccalaureate teacher preparation program.
    (B) The institution offers a baccalaureate degree that, in 
combination with other training or experience, will prepare an 
individual to teach in a high-need field and has entered into an 
agreement with a TEACH Grant-eligible institution that offers a teacher 
preparation program or one that offers a post-baccalaureate program.
    (C) The institution provides either a two-year program that is 
acceptable for full credit toward a high-quality baccalaureate teacher 
preparation program at a TEACH Grant-eligible institution, as 
demonstrated by the institutions, or a two-year program that is 
acceptable for full credit toward a baccalaureate degree in a high-need 
field at a TEACH Grant-eligible institution, as demonstrated by the 
institutions.
    Reasons: For TEACH Grant purposes, section 420L of the HEA 
specifies that an eligible institution must be financially responsible. 
Unlike the current regulations that allow an institution that is not 
financially responsible to continue to participate in all of the other 
title IV, HEA programs under an alternate financial standard in Sec.  
668.175, the proposed regulations would not permit that institution to 
participate in the TEACH Grant program under alternate standards in 
Sec.  668.175(d)(1)(ii), (f), or (g).
    The proposed definition of TEACH Grant-eligible institution would 
make several kinds of institutions TEACH Grant-eligible. In some cases 
eligibility would be based on an institution's offering a teacher 
preparation program. In other cases, eligibility would be based on the 
relationships institutions establish with one another. This would 
provide for several pathways for students to acquire the education and 
knowledge needed to serve as highly-qualified teachers in high-need 
fields. One such pathway would be completion of a baccalaureate or 
master's degree teacher preparation program. The Department initially 
considered requiring that the teacher preparation program offered by an 
institution be accredited by a specialized accrediting agency 
recognized by the Secretary for the accreditation of teacher education 
programs or be approved by a State. However, because section 420L(1)(A) 
of the HEA stipulates that teacher preparation must include extensive 
clinical experience, and some States approve programs that do not 
include extensive clinical experience, the Department proposes instead 
that a teacher preparation program must either be accredited by a 
specialized accrediting agency or approved by a State and include 
extensive pre-service clinical experience and pedagogical coursework.
    The proposed definition of TEACH Grant-eligible program would 
clarify that, in order to be eligible under this program, an 
institution offering a teacher preparation program must also provide 
supervision and support services to teachers, or assist in the 
provision of services to teachers. Several non-Federal negotiators 
noted that most institutions do not directly supervise teachers in the 
classroom, if the term ``supervise'' is understood in the employment 
sense. However, institutions do provide services in the form of 
providing information and resources to teachers and school districts, 
and direct observation and coaching, to strengthen the classroom 
performance of novice teachers. The definition of TEACH Grant-eligible 
program includes examples of the kinds of services that an institution 
might offer as its supervision and support services.
    A second pathway for a student to prepare to teach in a high-need 
field would be either completion of a baccalaureate program at one 
institution and a master's level teacher preparation program at another 
institution or a post-baccalaureate program at an institution that does 
not offer a teacher preparation program. Under the proposed definition, 
in order for the first institution to be eligible, it would need to 
have entered into an agreement with an institution offering a teacher 
preparation program or a post-baccalaureate program.
    Two pathways are identified for students who initially enroll in a 
two-year institution. The Department initially considered making such 
an institution eligible if it offered a program that was fully 
transferable to a four-year TEACH Grant-eligible institution offering a 
teacher preparation program or one offering a baccalaureate program in 
a high-need field. The non-Federal negotiators recommended using the 
phrase ``acceptable for full credit toward a baccalaureate degree'' in 
place of ``fully transferable to a four-year institution.'' We used the 
language recommended by the non-Federal negotiators in the proposed 
definition because it would mirror language from section 101 of the 
HEA. We would consider that an institution meets this requirement if it 
can demonstrate upon the request of the Secretary that its two-year 
program is fully-acceptable by at least one four-year institution. 
Examples of documents institutions might use to demonstrate that the 
two-year program is acceptable for full credit toward a baccalaureate 
program would include both formal articulation agreements with four-
year institutions and actual student records demonstrating that four-
year institutions fully accept transfer credits from the two-year 
institution.

TEACH Grant-Eligible Program

    Statute: The HEA does not define the term eligible program for the 
TEACH Grant program.
    Proposed Regulations: Proposed Sec.  686.2 would define the term 
TEACH Grant-eligible program as an eligible program as defined in 34 
CFR 668.8 that is a program of study that prepares an individual to 
teach in a high-need field and that leads to a baccalaureate or 
master's degree, or is a post-baccalaureate program of study. Under the 
proposed definition for the term TEACH Grant-eligible program, a two-
year program of study that is acceptable for full credit toward a 
baccalaureate degree would be considered to be a program of study that 
leads to a baccalaureate degree.
    Reasons: The proposed definition is based on provisions in section 
420L of the HEA and the proposed definition of TEACH Grant-eligible 
institution in proposed Sec.  686.2. While supporting the definition, 
some non-Federal negotiators were concerned that it would not be 
readily apparent to students which programs at an institution would be 
TEACH Grant-eligible programs because of the various pathways that a 
student might follow in preparing to teach as a highly-qualified 
teacher in a high-need field. The Department believes that each 
institution would need to define which of its programs would be TEACH 
Grant-eligible programs. A couple of the non-Federal negotiators 
suggested that their institutions would likely require students to 
develop an academic plan indicating how they would gain the education 
needed to begin a teaching career as a highly-qualified teacher in a 
high-need field. Based on that plan, they would be able to determine 
whether the student's program of study meets the definition 
requirements of a TEACH Grant-eligible program. Other non-Federal 
negotiators agreed and suggested that it would be helpful to include 
the appropriate academic departments in the review of academic plans. 
All members of the negotiating committee agreed that these suggestions 
made sense.

Teacher

    Statute: The HEA does not define the term teacher.
    Proposed Regulations: Proposed Sec.  686.2 would define the term 
teacher

[[Page 15342]]

for purposes of the TEACH Grant program as a person who provides direct 
classroom teaching or classroom-type teaching in a non-classroom 
setting, including special education teachers and reading specialists.
    Reason: The proposed definition of teacher in Sec.  686.2 is taken 
from the FFEL program regulations for teacher loan forgiveness in 34 
CFR 682.215. The Secretary believes that it would be appropriate to use 
the same definition for both the TEACH Grant program and the FFEL 
teacher loan forgiveness program. Under the proposed definition, the 
term would not include counselors, administrators or other types of 
school personnel who may be listed in the Department's annual Teacher 
Shortage Area Nationwide Listing but who do not provide classroom or 
classroom-type teaching.

Teacher Preparation Program

    Statute: Section 420L of the HEA refers to teacher preparation 
program in the context of an eligible institution.
    Proposed Regulations: Proposed Sec.  686.2 would define the term 
teacher preparation program, for TEACH Grant program purposes, as a 
State-approved course of study, the completion of which signifies that 
a student has met all the State's educational or training requirements 
for initial certification or licensure to teach in the State's 
elementary or secondary schools. Under this definition, a teacher 
preparation program could be a regular program or an alternative route 
to certification, as defined by the State. Under the proposed 
definition, the teacher preparation program must be provided by an 
institution of higher education.
    Reason: The proposed definition of teacher preparation program 
would be adopted from the Reporting Reference and User Manual, the 
accountability system mandated under Title II (sections 207 and 208) of 
the HEA. The manual, which was subject to public comment, has been in 
use since 2000. Using the same definition in the TEACH Grant program 
would ensure consistency across programs that focus on enhancing 
teacher quality.

Duration of Student Eligibility (Sec.  686.3)

    Statute: Section 420M(d)(1) and (2) of the HEA provides that the 
maximum amount an undergraduate or post-baccalaureate student may 
receive in TEACH Grants is $16,000 and that the maximum amount a 
graduate student may receive in TEACH Grants is $8,000.
    Proposed Regulations: Section 686.3 of the proposed regulations 
would implement the statutory maximums. An undergraduate or post-
baccalaureate student would be eligible to receive the equivalent of up 
to four Scheduled Awards during the period required for the completion 
of the first undergraduate TEACH Grant-eligible baccalaureate program 
of study and the first post-baccalaureate program of study combined. A 
graduate student would be eligible to receive the equivalent of up to 
two Scheduled Awards during the period required for the completion of a 
TEACH Grant-eligible master's degree program of study.
    Reason: The proposed regulations would implement the statutory 
requirements related to the duration of student eligibility from 
section 420M(d)(1) and (2) of the HEA.

Institutional Participation (Sec.  686.4)

    Statute: The HEA does not specify whether an institution is 
required to participate in the TEACH Grant program.
    Proposed Regulations: Section 686.4 of the proposed regulations 
would provide that a TEACH Grant-eligible institution that offers one 
or more TEACH Grant-eligible programs may elect to participate in the 
TEACH Grant program. If an institution begins participation in the 
TEACH Grant program during an award year, a student enrolled at and 
attending that institution would be eligible to receive a TEACH grant 
for the payment period during which the institution begins 
participation and any subsequent payment period.
    An institution may cease to participate in the TEACH Grant program 
or may become ineligible to participate in the TEACH Grant program 
during an award year. A student who was attending the institution and 
who submitted a SAR with an official EFC to the institution, or for 
whom the institution obtained an ISIR with an official EFC, before the 
date the institution became ineligible would still be eligible to 
receive a TEACH Grant for the award year. The student would be eligible 
for the payment periods that the student completed before the 
institution ceased participation or became ineligible to participate 
and the payment period in which the institution ceased participation or 
became ineligible to participate.
    An institution that ceases to participate in the TEACH Grant 
program or becomes ineligible to participate in the TEACH Grant program 
would be required to provide to the Secretary, within 45 days after the 
effective date of the loss of eligibility: (1) The name and other 
student identifiers of each eligible student under Sec.  686.11 who, 
during the award year, submitted a SAR with an official EFC to the 
institution or for whom it obtained an ISIR with an official EFC before 
it ceased to participate in the TEACH Grant program or became 
ineligible to participate; (2) the amount of TEACH Grant funds paid to 
each student during the award year; (3) the amount due each student 
eligible to receive a TEACH Grant through the end of the payment period 
during which the institution ceased to participate in the TEACH Grant 
program or became ineligible to participate; and (4) an accounting of 
the TEACH Grant program expenditures for that award year to the date of 
termination.
    Reasons: The proposed regulations for this section would generally 
follow the Federal Pell Grant Program regulations in 34 CFR 690.7. 
Using these established procedures and processes that are already 
understood by institutions would simplify delivery for institutions and 
reduce institutional burden.

Enrollment Status for Students Taking Regular and Correspondence 
Courses (Sec.  686.5)

    Statute: The HEA does not specifically address enrollment status 
for regular and correspondence courses.
    Proposed Regulations: Section 686.5 of the proposed regulations 
would specify how an institution would treat correspondence courses for 
purposes of the TEACH Grant program. In determining a student's 
enrollment status, an institution could include correspondence courses 
a student takes from either his or her own institution or from another 
institution having an arrangement for this purpose with the student's 
institution.
    Except as specified in proposed Sec.  686.5(c), the correspondence 
work that could be included in determining a student's enrollment 
status would be that amount of work that: (a) Applies toward a 
student's degree or post-baccalaureate program of study or is remedial 
work taken by the student to help in his or her TEACH Grant-eligible 
program; (b) is completed within the period of time required for 
regular coursework; and (c) does not exceed the amount of a student's 
regular coursework for the payment period for which enrollment status 
is being calculated.
    Under proposed Sec.  686.5(c), a student who would be a half-time 
student based solely on his or her correspondence work would be 
considered a half-time student unless the calculation in the preceding 
paragraph produces an enrollment status greater than half-time. A 
student who would be a less-than-half-time student based solely on his 
or

[[Page 15343]]

her correspondence work or a combination of correspondence work and 
regular coursework would be considered a less-than-half-time student.
    Reason: As is the case with the Federal Pell Grant Program, a 
student's award for a TEACH Grant is considered to be awarded based on 
the student's enrollment status. Accordingly, we believe it is 
appropriate for proposed Sec.  686.5 to follow the corresponding 
Federal Pell Grant Program regulations in 34 CFR 690.8 for determining 
enrollment status for students taking correspondence courses.

Payment From More Than One Institution (Sec.  686.6)

    Statute: The HEA does not address the issue of receipt of TEACH 
Grants from more than one institution.
    Proposed Regulations: Proposed Sec.  686.6 would stipulate that a 
student may not receive TEACH Grant payments concurrently from more 
than one institution.
    Reason: Under the Federal Pell Grant program and the ACG and 
National SMART Grant programs, a student cannot receive payments from 
more than one institution at the same time. To ensure coordination with 
the Federal Pell Grant program and the ACG and National SMART Grant 
programs programs, proposed Sec.  686.6 would provide that a student 
can only receive a TEACH Grant from one institution for the same 
payment period.

Application (Sec.  686.10)

    Statute: Section 420N(a) of the HEA contains the student 
eligibility requirements for the TEACH Grant program. Section 
420N(a)(1) requires that to receive a TEACH Grant, a student must 
apply. Section 420N(a)(2) provides for additional information that a 
student may need to submit as part of the application process. Section 
420N(b) provides that a service agreement must accompany the 
application. In addition, the TEACH Grant program, along with the other 
Title IV, HEA programs, is subject to the provisions of section 483 of 
the HEA, which establishes a common financial aid form for these 
programs.
    Proposed Regulations: Section 686.10 of the proposed regulations 
would specify the procedures that a student must follow when applying 
for a TEACH Grant, and in particular, would require that a student must 
submit a Free Application for Federal Student Aid (FAFSA); complete and 
sign a service agreement and promise to repay; and provide any 
additional information requested by the Secretary.
    Reasons: Under section 483(a) of the HEA, the FAFSA is the standard 
form used by all students applying for Title IV, HEA program aid. 
Although the TEACH Grant program is not need-based, using the FAFSA and 
procedures that are similar to those used in the Federal Pell Grant 
program would enable institutions to make a determination of student 
eligibility for the TEACH Grant program until a streamlined application 
can be developed. Completion of a service agreement and promise to 
repay are considered to be part of the application process. Further 
requirements regarding the service agreement would be set forth in 
proposed Sec.  686.12. The promise to repay describes the terms and 
conditions of the Federal Direct Unsubsidized Loan to which the TEACH 
Grant is converted if the grant recipient fails to meet the service 
obligation. Finally, the regulations provide for the collection of 
additional information, such as test scores, to ensure that students 
are eligible.

Eligibility to Receive a Grant (Sec.  686.11)

Undergraduate, Post-Baccalaureate, and Graduate Students

    Statute: Section 420N(a) of the HEA provides student eligibility 
requirements for the TEACH Grant program.
    Proposed Regulations: Section 686.11(a)(1)(i) through (iv) of these 
proposed regulations would set forth the TEACH Grant student 
eligibility requirements common to all students who are enrolled in 
undergraduate, post-baccalaureate, and graduate programs. All students 
would have to meet the student eligibility requirements under 34 CFR 
part 668, subpart C; have submitted a completed application along with 
a signed service agreement; and be enrolled in a TEACH Grant-eligible 
institution in a TEACH Grant-eligible program. All students would also 
be required to be completing coursework and other requirements 
necessary to begin a career in teaching or plan to do so before 
graduating.
    Reason: An otherwise eligible student remains eligible for a TEACH 
Grant as long as that student is still completing coursework and other 
requirements necessary to begin a career in teaching or plans to 
complete such coursework and requirements prior to graduating. However, 
simply graduating from a program does not necessarily mean the same as 
completing all of the coursework necessary to begin a career in 
teaching. For example, a student may graduate with an undergraduate 
degree, but must complete a post-baccalaureate program or other 
coursework before the student can begin a career in teaching. Thus, 
where the proposed regulations refer to completion of coursework and 
other requirements before graduating, the Secretary would interpret the 
term ``graduating'' to mean the point at which the student has 
completed all the coursework and other requirements necessary to 
prepare that student to begin a career in teaching.
    Statute: Section 420N(a) of the HEA provides student eligibility 
requirements for the TEACH Grant program. Section 420N(a)(2)(A)(ii) of 
the HEA contains requirements related to academic achievement that 
enrolled students receiving TEACH Grants must meet.
    Proposed Regulations: Section 686.11(a)(1)(v) of the proposed 
regulations would set forth additional TEACH Grant student eligibility 
requirements. Proposed Sec.  686.11(a)(1)(v)(E) would stipulate that 
all students, regardless of postsecondary level, may qualify for a 
TEACH Grant by scoring above the 75th percentile of scores on at least 
one of the batteries from a nationally-normed standardized 
undergraduate, graduate, or post-baccalaureate admissions test. The 
student's test score would be compared to the test score achieved by 
all students taking the same test during the same period the student 
took the test. Students who do not meet this requirement must meet the 
GPA requirements under proposed Sec.  686.11(a)(1)(v)(A) through (D) to 
either initially qualify for or maintain eligibility for a TEACH Grant.
    Reason: Proposed Sec.  686.11(a)(1)(v)(E) would implement the 
statutory requirement under section 420N(a)(2)(A)(ii)(II) of the HEA 
that a student may qualify for a TEACH Grant by displaying high 
academic aptitude as demonstrated by scoring above the 75th percentile 
on at least one battery on a standardized admissions test. Thus, for 
example, a student who scored above the 75th percentile on the math 
section of the SAT Reasoning Test (SAT), but who scored below the 75th 
percentile on the other sections of the SAT, could qualify for a TEACH 
Grant, if otherwise eligible, because the student displayed high 
academic aptitude by scoring above the 75th percentile on one of the 
SAT batteries.
    The proposed regulations would not restrict the applicability of 
qualifying test scores by educational level. A qualifying test score 
from an undergraduate admissions test could qualify an otherwise 
eligible student for a TEACH Grant regardless of whether the student 
would be an undergraduate

[[Page 15344]]

or graduate student. The proposed regulations would also not place a 
limit on the period of time that has elapsed since the student earned 
the qualifying test score. The qualifying test score is intended to 
demonstrate high academic aptitude and the negotiators believed that 
there is no reason to suppose that there would be a time limitation on 
such demonstration of academic aptitude or that one should be set. An 
otherwise eligible student who qualified with a test score would not 
need to meet additional GPA requirements to retain eligibility for a 
TEACH Grant. However, tests used exclusively as placement tests by the 
institution could not be used to qualify a student for a TEACH Grant.
    Proposed Sec.  686.11(a)(1)(v)(A)(1) would implement the statutory 
provision that a student in the first year of a program of 
undergraduate education can qualify for a TEACH Grant with a cumulative 
secondary school GPA of 3.25 on a 4.0 scale, or the numeric equivalent. 
A student qualifying with such a GPA for the first year would need to 
meet additional GPA requirements to retain eligibility for a TEACH 
Grant once that student is beyond the first year of his or her 
undergraduate program.
    Proposed Sec.  686.11(a)(1)(v)(A)(2), (B), (C), and (D) would 
implement the statutory requirement that a student who did not achieve 
the requisite test score under proposed Sec.  686.11(a)(1)(v)(E) must 
maintain a 3.25 GPA on a 4.0 scale, or the numeric equivalent, in order 
to maintain eligibility for a TEACH Grant. Under proposed Sec.  
686.11(a)(1)(v)(A)(2), students in the first year of a program of 
undergraduate education, as determined by the institution, who did not 
qualify under proposed Sec.  686.11(a)(1)(v)(A)(1), would need to 
achieve an undergraduate GPA of 3.25 on a 4.0 scale, or the numeric 
equivalent, through the most recently completed payment period, to be 
eligible for a TEACH Grant. Similarly, under proposed Sec.  
686.11(a)(1)(v)(B), a student beyond the first year of a program of 
undergraduate education (including a post-baccalaureate program), as 
determined by the institution, would need to maintain an undergraduate 
GPA of 3.25 on a 4.0 scale, or the numeric equivalent, through the 
most-recently completed payment period, to continue to be eligible.
    For graduate students, proposed Sec.  686.11(a)(1)(v)(C) would 
provide that the student may qualify for a TEACH Grant in the first 
payment period of graduate study based on a cumulative undergraduate 
GPA of at least 3.25 on a 4.0 scale, or the numeric equivalent. Under 
proposed Sec.  686.11(a)(1)(v)(D), graduate students beyond the first 
payment period would need to achieve a cumulative graduate GPA of at 
least 3.25 on a 4.0 scale, or the numeric equivalent, through the most-
recently completed payment period.

Current or Former Teachers or Retirees (Sec.  686.11(b))

    Statute: Section 420N(a) of the HEA provides student eligibility 
requirements for the TEACH Grant program. Section 420N(a)(2)(B) 
provides student eligibility requirements for students who are current 
or former teachers or retirees.
    Proposed Regulations: Proposed Sec.  686.11(b) would set forth the 
TEACH Grant student eligibility requirements for current or former 
teachers and retirees. A current or former teacher or retiree would 
need to meet the student eligibility requirements under 34 CFR part 
668, subpart C and have submitted a completed application along with a 
signed service agreement, and be applying for a TEACH Grant to obtain a 
master's degree. The applicant would need to be a teacher or retiree or 
be a current or former teacher pursuing certification through a high-
quality alternative certification route. The applicant also would need 
to be enrolled in a TEACH Grant-eligible institution in a TEACH Grant-
eligible program during the time period required for completion of a 
master's degree.
    Reason: Proposed Sec.  686.11(b) would implement the statutory 
requirements related to student eligibility for current and former 
teachers and retirees in 420N(a)(2)(B) of the HEA.

Transfer Student GPA (Sec.  686.11(c))

    Statute: Section 420N(a)(2)(A)(ii)(I) of the HEA provides that an 
undergraduate, post-baccalaureate or graduate student's eligibility for 
a TEACH Grant may be based on the student maintaining a cumulative GPA 
of at least 3.25 on a 4.0 scale.
    Proposed Regulations: Proposed Sec.  686.11(c) would be based on 
the transfer student GPA requirements in the National SMART Grant 
program for institutions that do or do not incorporate transfer grades 
from coursework accepted by the new institution, except that for 
purposes of the TEACH Grant program, the GPA would be calculated based 
on the coursework accepted by the institution on transfer without 
determination of whether the transferred coursework will actually be 
considered part of the TEACH Grant-eligible program.
    Reasons: The proposed regulations would ensure that a transfer 
student could meet the GPA requirement to receive a TEACH Grant for his 
or her first payment period at the institution to which the student has 
transferred by calculating the student's transfer GPA using a 
methodology similar to that already used by the institution to 
determine a transfer student's GPA for the National SMART Grant 
program. The Secretary believes that allowing the new institution to 
use grades assigned to coursework accepted by the new institution for 
initial GPA calculation purposes for that transfer student instead of 
using grades assigned only to coursework accepted into the TEACH Grant-
eligible program would decrease the burden on institutions and students 
because institutions will not have to take the extra step of 
determining which of the transferred cour