Student Assistance General Provisions; Teacher Education Assistance for College and Higher Education (TEACH) Grant Program; Federal Pell Grant Program; Academic Competitiveness Grant Program and National Science and Mathematics Access To Retain Talent Grant Program, 61240-61246 [E9-28050]
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Federal Register / Vol. 74, No. 224 / Monday, November 23, 2009 / Rules and Regulations
Final regulations.
DEPARTMENT OF EDUCATION
ACTION:
34 CFR Parts 668, 686, 690, and 691
SUMMARY: The Secretary is adopting as
final, with changes, interim final
regulations for the Academic
Competitiveness (ACG) and National
Science and Mathematics to Retain
Talent Grant (National SMART Grant)
programs; Student Assistance General
Provisions; Federal Pell Grant Program;
and Teacher Education Assistance for
College and Higher Education (TEACH)
Grant Program. These final regulations
are needed to implement provisions of
the Higher Education Act of 1965
(HEA), as amended by the Ensuring
Continued Access to Student Loans Act
of 2008 (ECASLA) and the Higher
Education Opportunity Act of 2008
RIN 1840–AC96
[Docket ID ED–2009–OPE–0001]
Student Assistance General
Provisions; Teacher Education
Assistance for College and Higher
Education (TEACH) Grant Program;
Federal Pell Grant Program; Academic
Competitiveness Grant Program and
National Science and Mathematics
Access To Retain Talent Grant
Program
AGENCY: Office of Postsecondary
Education, Department of Education.
(HEOA). The new statutory provisions
became effective July 1, 2009.
DATES: These regulations are effective
January 22, 2010.
FOR FURTHER INFORMATION CONTACT:
Topic
Contact person and information
General information and information related to rigorous secondary
school programs and eligible majors.
Information related to grade level progression ........................................
Sophia McArdle. Telephone: (202) 219–7078 or via the Internet: sophia.mcardle@ed.gov.
Fred Sellers. Telephone: (202) 502–7502 or via the Internet:
fred.sellers@ed.gov.
Jacquelyn Butler. Telephone: (202) 502–7890 or via the Internet: jacquelyn.butler@ed.gov.
Carney McCullough. Telephone: (202) 502–7639 or via the Internet:
carney.mccullough@ed.gov.
Information related to payments for part-time students ...........................
Information related to prior enrollment .....................................................
Individuals with disabilities can
obtain this document in an accessible
format (e.g., braille, large print,
audiotape, or computer diskette) on
request to the first contact person listed
under FOR FURTHER INFORMATION
CONTACT.
On May 1,
2009, the Secretary published interim
final regulations for the ACG and
National SMART Grant Programs in the
Federal Register (74 FR 20210). The
interim final regulations became
effective July 1, 2009. At the time the
interim final regulations were
published, the Secretary requested
public comment on whether changes to
the regulations were warranted.
In the preamble to the interim final
regulations, the Secretary discussed, on
pages 20210 through 20218, the major
issues covered by the regulations. The
following paragraphs summarize those
issues and identify the relevant sections
of the interim final regulations:
The Secretary amended the definition
of the term ACG Scheduled Award to be
the maximum amount of an ACG that
would be paid to a full-time first-year
student or a full-time second-year
student for the applicable year. A
National SMART Grant Scheduled
Award was defined as the maximum
amount of a National SMART Grant that
would be paid to a full-time third-year,
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SUPPLEMENTARY INFORMATION:
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fourth-year, or fifth-year student for the
applicable year (see § 691.2(d)).
In § 691.2(d), the Secretary defined
the term annual award to be the
maximum ACG or National SMART
Grant amount a student would receive
for enrolling as a full-time, threequarter-time, or half-time student and
remaining in that enrollment status for
one year.
The Secretary amended the definition
of the term eligible major in § 691.2(d)
to include, in addition to majors in
physical, life, or computer sciences,
mathematics, technology, engineering or
a critical foreign language, a qualifying
liberal arts curriculum as determined by
the Secretary.
The Secretary amended the definition
of the term eligible program to include,
for the ACG program, an undergraduate
certificate program of at least one
academic year in length and, for the
National SMART Grant program, a
degree program with at least five full
undergraduate years of coursework at a
degree-granting institution of higher
education (see § 691.2(d)).
In § 691.2(e), the Secretary defined the
terms first-year, second-year, third-year
fourth-year, and fifth-year as a student’s
grade level in the student’s eligible
program as determined by the
institution for all students in the eligible
program.
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The Secretary amended the method
by which the duration of student
eligibility was determined, by basing
eligibility on a student’s grade level,
rather than on the student’s academic
year (see §§ 691.2(d) and 691.6). In
§ 691.6(b)(2), the Secretary provided
that a fourth-year student enrolled in a
National SMART Grant-eligible program
with less than five full years of
coursework continues to be considered
a fourth-year student for purposes of the
National SMART Grant program until
he or she completes his or her first
undergraduate baccalaureate course of
study, and that a fifth-year student,
enrolled in a National SMART Granteligible program with a least five full
years of coursework, continues to be
considered a fifth-year student until he
or she completes his or her first
undergraduate baccalaureate course of
study.
In § 691.8, the Secretary detailed how
correspondence courses would be
applied toward a student’s enrollment
status (i.e., as a half-time, three-quartertime, and full-time student) in an
eligible program.
The Secretary removed the provisions
from § 691.15(a) that stated that
eligibility for ACGs and National
SMART Grants is limited to U.S.
citizens and students who are enrolled
full-time.
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With respect to eligibility for a firstyear ACG, the Secretary provided that
the restriction on prior enrollment does
not apply to students who were enrolled
as regular students in an eligible
program of undergraduate education
that was also part of a secondary school
program of study, and clarified that
transfer students who are first-year
students are not considered to have
been previously enrolled and, therefore,
are not subject to the prior enrollment
restriction (§ 691.15(b)(1)(ii)(C)).
The Secretary amended § 691.16 to
provide that starting with the 2009–
2010 award year, a designated official,
consistent with State law, may
recognize and report to the Secretary
any secondary school programs of study
that prepare students for college and
that the designated official deems
rigorous. These programs supplement
the secondary school programs
previously recognized by the Secretary
as rigorous. It is no longer the
Secretary’s role to recognize secondary
school programs of study as rigorous.
The Secretary exempted a student
enrolled in a qualifying liberal arts
curriculum from the requirement that
the student must declare an eligible
major to receive a National SMART
Grant and provided that an institution
need only document a student’s
progress in completing the program in
the intended or declared National
SMART Grant-eligible program
(§§ 691.15(d)(3) and 691.15(e)).
The Secretary amended the
regulations to provide that an eligible
major includes any ‘‘critical foreign
language’’ found in section 103(3) of the
HEA, rather than critical foreign
languages identified by the Secretary
after consulting with the Director of
National Intelligence. The Secretary also
amended the regulations to provide that
an eligible major includes qualifying
liberal arts curricula and to describe the
process by which an institution requests
designation of a liberal arts curriculum
as an eligible major.
In § 691.62, the Secretary set the ACG
and National SMART Grant annual
award amounts for full-time, threequarter-time, and half-time students.
The annual award for a full-time student
is the same amount as the student’s
Scheduled Award.
The Secretary described in §§ 691.63
and 691.66 how ACG and National
SMART Grant payments for a payment
period must be calculated for full-time,
three-quarter-time, and half-time
students as well as for students in a
program of study offered by
correspondence.
The Secretary amended § 691.63(h) to
provide that a student may not progress
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to the next year in a grade level (rather
than next academic year) during a
payment period.
Analysis of Comments and Changes
The final regulations in this document
were developed through the analysis of
the two comments we received on the
interim final regulations published on
May 1, 2009. An analysis of the
comments and of the changes to the
regulations since publication of the
interim final regulations follows. We
group major issues according to subject,
with appropriate sections of the
regulations referenced in parentheses.
Generally, we do not address technical
and other minor changes.
General Comment
Comment: One commenter supported
the interim final regulations, citing in
particular its approval of the definitions
of annual award, first-year, second-year,
third-year, fourth-year, and fifth-year,
the requirement that the grade level
used for purposes of awarding ACG and
National SMART Grant funds be the
same grade level used for determining
annual loan limits under the Federal
Family Education Loan (FFEL) Program
and the William D. Ford Federal Direct
Loan (Direct Loan) Program, and the
provisions governing enrollment status
and student eligibility that allow
students enrolled less than full-time but
at least half-time to be eligible for ACG
and National SMART Grants.
Discussion: The Secretary appreciates
the support of the commenter.
Changes: None.
Definitions (§ 691.2)
Eligible Program (§ 691.2(d))
Comment: One commenter was
concerned that, under the definition of
the term eligible program in § 691.2(d),
a five-year program that is a qualifying
liberal arts curriculum identified as an
eligible major under § 691.17(b) would
not qualify as a National SMART Granteligible program. The commenter
believed that the HEA does not
disqualify a five-year program from
eligibility and that a student in such a
program would be eligible for a thirdand fourth-year National SMART Grant.
Discussion: We do not agree with the
commenter. Section 401A(c)(3)(E) of the
HEA specifies that a student can receive
a fifth-year National SMART Grant if he
or she is enrolled in a program requiring
five full years of coursework for which
a baccalaureate degree is awarded in the
physical, life, or computer sciences,
mathematics, technology, engineering,
or a critical foreign language. Section
401A(c)(3)(D) of the HEA contains
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National SMART Grant eligibility
requirements for students enrolled in a
liberal arts curriculum, providing that
such curriculum must consist of at least
four years of study in mathematics and
three years of study in the sciences,
with a laboratory requirement in each of
those years or that the student study a
subject that is at least equal to the
requirements for an academic major at
an institution that offers a baccalaureate
degree in that subject. While section
401A(c)(3)(D) of the HEA does not
explicitly state that a qualified liberal
arts curriculum may not be a five year
program, we find it to be implicit, based
on the structure of section 401(c)(3) and
because section 401A(c)(3)(E) of the
HEA, covering fifth-year National
SMART Grant eligibility, does not
include liberal arts curricula as a major
for which a student may earn a fifthyear grant.
Changes: None.
Comments: One commenter noted
that the definition of the term eligible
program for purposes of the ACG
Program incorporates certificate
programs but does not specify that
certificate programs must be offered by
degree-granting institutions of higher
education.
Discussion: We agree with the
commenter that a certificate program is
an eligible program only if it is offered
at a two-year or four-year degreegranting institution. Section
401A(c)(3)(A) of the HEA provides that
an eligible student that receives a firstyear ACG award must be enrolled or
accepted for enrollment in the first year
of a program of undergraduate
education at a two- or four-year degreegranting institution of higher education,
‘‘including a program of not less than
one year for which the institution
awards a certificate.’’ To receive a
second year ACG in accordance with
section 401A(c)(3)(B) of the HEA, an
eligible student must be enrolled or
accepted for enrollment in the second
year of a program of undergraduate
education at a two- or four-year degreegranting institution of higher education,
‘‘including a program of not less than
two years for which the institution
awards a certificate.’’
Changes: We have amended the
definition of the term eligible program
in § 691.2(d) to provide that, for
purposes of the ACG Program, an
undergraduate program of at least one
academic year in length that leads to a
certificate must be offered by a two-year
or four-year degree-granting institution
of higher education for a first-year ACG.
Also, we have clarified in this definition
that, for a second-year ACG, an eligible
program is an undergraduate program of
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at least two academic years in length
that leads to a certificate or associate
degree and is offered by a two-year or
four-year degree-granting institution of
higher education.
Duration of Student Eligibility—
Undergraduate Course of Study
(§ 691.6)
Comment: One commenter supported
the provisions in § 691.6(b) that extend
the National SMART Grant eligibility of
a student in the final year of a student’s
four- or five-year program until the
student graduates. Under these
provisions, a student enrolled in a
National SMART Grant-eligible program
with less than five full years of
coursework in the case of a fourth-year
student, or with at least five full years
of coursework in the case of a fifth-year
student, remains a fourth- or fifth-year
student respectively until the
completion of his or her undergraduate
baccalaureate course of study. The
commenter encouraged the Department
to adopt the same policy for students
enrolled in associate degree programs
and questioned whether the policy
would also apply to certificate
programs.
The commenter also believed that
under § 691.6 a student enrolled in a
certificate program that is longer than
one academic year in length would be
eligible for a second-year ACG. For
example, an eligible student enrolled in
a program that is 45 credit hours and 45
weeks of instructional time in length
would receive the maximum first-year
ACG as well as half of a second-year
ACG. The commenter further
questioned whether that student could
ever be eligible to receive more than half
of a second-year ACG.
The commenter also stated that in the
loan programs, a student enrolled in a
program that is one academic year in
length could never receive funds at
second-year loan limits regardless of
how long it took the student to complete
the program. The commenter questioned
whether a student who took more than
one academic year to complete a oneyear certificate program would ever be
eligible to receive any portion of a
second-year ACG for the extra time it
took to complete the program.
Discussion: We appreciate the
commenter’s support of the change in
the regulations that extends a student’s
eligibility for a National SMART Grant
award for a fourth- and fifth-year
student until the student completes his
or her first undergraduate baccalaureate
course of study. We also appreciate the
commenter’s recommendation that the
regulations should extend the final year
of eligibility to students enrolled in one-
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academic-year certificate programs or
two-academic-year certificate or
associate degree programs. However, to
provide the extensions for shorter
educational programs would result in an
estimated increase in program costs of
$16 million over the final two years of
the ACG and National SMART Grant
programs. To make the changes, we
would need to identify savings to offset
the cost increase. We have been unable
to identify any offsetting savings.
We do not agree with the commenter’s
assessment that a student enrolled in a
program that is 45 credit hours and 45
weeks of instructional time in length
would be eligible for half of a secondyear ACG. The student in that example
would only qualify for a full first-year
ACG. Section 401A(c)(3)(D) of the HEA
provides that a student may be eligible
for a second-year ACG if he or she is
enrolled in a certificate program of not
less than two years. Although the
program in the example is longer than
one-academic year in length, the student
would not qualify for any portion of the
second-year ACG because the program
is less than two academic years in
length. The program is an eligible
program only for a first-year ACG.
We note that in some cases, under the
FFEL and Direct Loan programs, a
student in a certificate or associate
degree program that extends to a thirdyear grade level may receive funds at
the third-year annual loan limits. For
purposes of ACG, as a third-year
student, the student would not qualify
for funds from a second-year ACG.
Changes: None.
Eligibility To Receive a Grant (§ 691.15)
Comments: One commenter noted
that a student who enters college with
a full year of credit from Advanced
Placement (AP) or International
Baccalaureate (IB) coursework will not
have a grade point average (GPA), and
therefore cannot qualify for a secondyear ACG because he or she cannot meet
the minimum 3.0 GPA required to
receive an ACG. The commenter
suggested that the Department allow the
AP or IB exam scores to satisfy the GPA
requirement, or allow the final high
school GPA to be used, or provide some
other method by which an equivalency
for the GPA could be determined.
Discussion: Section 401A(c)(3)(B)(ii)
of the HEA specifies that to receive a
second-year ACG, a student must obtain
a cumulative GPA of at least 3.0 (or the
equivalent as determined under
regulations prescribed by the Secretary)
at the end of the first year of the
program of undergraduate education.
The statute does not allow for any other
GPA, such as a final high school GPA,
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to satisfy the 3.0 GPA requirement. With
respect to AP or IB exam scores, there
is no standardized methodology for
equating AP or IB exam scores with
undergraduate grades. Regulations for
determining the numeric equivalent at
institutions of higher education that
assess GPA on a numeric scale other
than a 4.0 scale were previously
published. In the case of credits that are
awarded when no postsecondary
coursework has been completed, the
Secretary believes that it is not possible
to determine a numeric equivalent, and
therefore agrees with the commenter
that a student in this circumstance
cannot qualify for a second-year ACG
because he or she cannot meet the
minimum 3.0 GPA required to receive
an ACG.
Changes: None.
Comment: One commenter
commended the Secretary for
eliminating from § 691.15(e) the
requirement that the institution
document a student’s progress in his or
her major each term. The same
commenter stated that any requirement
to document progress in the student’s
program outside of normal satisfactory
academic progress is unnecessary and
meaningless and recommended deleting
all of § 691.15(e).
Discussion: The commenter
misunderstood the interim final
regulations. The Secretary did not
eliminate the requirement to document
progress in the major for each term.
Rather, the interim final regulations
removed the requirement in
§ 691.15(c)(2)(ii) that a student enroll in
courses necessary both to complete the
degree program and fulfill the
requirements of the eligible major each
payment period, and that the institution
document that enrollment. Section
691.15(e) continues to require an
institution to document a student’s
progress in taking the courses necessary
to complete the National SMART Granteligible program in the intended or
declared major. The Secretary does not
agree that documenting progress in the
student’s program beyond that required
to show a student’s satisfactory
academic progress under § 668.34(e) is
unnecessary or meaningless. National
SMART Grant eligibility is determined
each payment period, and institutions
must document that a student achieved
at least a 3.0 cumulative GPA for each
payment period. Under the satisfactory
academic progress regulations in
§ 668.34(e), an institution is required to
review a student’s academic progress
only at the end of each year. Because
eligibility for a National SMART Grant
is determined each payment period, an
annual review would be insufficient to
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ensure that a student continues to make
the necessary progress in his or her
National SMART Grant-eligible program
for every payment period.
Changes: None.
Calculation of a Grant for a Payment
Period (§ 691.63(h))
Comment: One commenter questioned
whether it was appropriate to provide
that a student may not progress to the
next grade level during a payment
period, as was previously required
when progression was based on a
student’s academic year. The
commenter noted various reasons why a
student’s grade level may change during
a payment period, including error, late
grade submission, or late arriving
transcripts from other institutions. The
commenter believed that we should
treat a student’s grade level change
made during a payment period similarly
to the way we treat grade level changes
for purposes of determining annual loan
limits under the FFEL and Direct Loan
programs.
Discussion: While a student’s grade
level may change during a payment
period for a variety of reasons, a student
can only be eligible for payment from
one Scheduled Award during the
payment period. This circumstance is
fundamentally different from the
application of annual loan limits that
are not applied on the same basis as
determining Scheduled Awards for ACG
and National SMART Grants. Except in
the case of an institutional error, we
believe that a Scheduled Award based
on a student’s grade level at the outset
of the payment period is the most
appropriate Scheduled Award for
determining the student’s eligibility for
payment. If, due to an institutional
error, an incorrect grade level was the
basis for determining the student’s
award, the institution must correct the
error and adjust the student’s award
based on the correct grade level.
Changes: None.
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Calculation of a Federal Pell Grant for
a Payment Period (§ 690.63(d))
Comment: None.
Discussion: In reviewing the interim
final regulations, we identified an error
in the amendatory language related to
§ 690.63(d). Specifically, we
inadvertently amended § 690.63(d)(1)(i)
instead of § 690.63(d)(1).
Changes: We are correcting the error
by amending § 690.63(d)(1), so that it is
consistent with § 691.63(d)(1), which
governs calculation of an ACG or
National SMART Grant for a payment
period.
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Executive Order 12866
1. Regulatory Impact Analysis
Under Executive Order 12866, the
Secretary must determine whether the
regulatory action is ‘‘significant’’ and
therefore subject to the requirements of
the Executive order and subject to
review by the Office of Management and
Budget (OMB). Section 3(f) of Executive
Order 12866 defines a ‘‘significant
regulatory action’’ as an action likely to
result in a rule that may (1) have an
annual effect on the economy of $100
million or more, or adversely affect a
sector of the economy, productivity,
competition, jobs, the environment,
public health or safety, or State, local or
tribal governments or communities in a
material way (also referred to as an
‘‘economically significant’’ rule); (2)
create serious inconsistency or
otherwise interfere with an action taken
or planned by another agency; (3)
materially alter the budgetary impacts of
entitlement grants, user fees, or loan
programs or the rights and obligations of
recipients thereof; or (4) raise novel
legal or policy issues arising out of legal
mandates, the President’s priorities, or
the principles set forth in the Executive
order.
Pursuant to the terms of the Executive
order, it has been determined that this
final regulatory action will have an
annual effect on the economy of more
than $100 million. Therefore, this action
is ‘‘economically significant’’ and
subject to OMB review under section
3(f)(1) of Executive Order 12866.
Need for Federal Regulatory Action
As discussed in the interim final
regulations, these regulations address a
range of issues affecting students and
institutions of higher education
participating in the ACG and National
SMART Grant programs. They are
needed to implement statutory changes
enacted through the ECASLA and the
HEOA.
Regulatory Alternatives Considered
Alternatives to the regulations were
considered as part of the rulemaking
process. These alternatives were
reviewed in detail in the preamble to
the interim final regulations under both
the Regulatory Impact Analysis and the
Reasons sections accompanying the
discussion of each proposed regulatory
provision. To the extent that they were
addressed in response to comments
received on the interim final
regulations, alternatives are also
considered elsewhere in the preamble to
these final regulations under the
Discussion sections related to each
provision. No comments were received
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related to the Regulatory Impact
Analysis discussion of these
alternatives.
As discussed above in the Analysis of
Comments and Changes section, the
final regulations reflect statutory
amendments included in the HEOA and
minor revisions in response to public
comments. None of these changes result
in revisions to cost estimates prepared
for and discussed in the Regulatory
Impact Analysis of the interim final
regulations.
One alternative suggested by a
commenter that was considered
involved extending the final year of
eligibility for students enrolled in oneacademic-year certificate programs or
two-academic-year certificate or
associate degree programs. A
commenter argued that such an
extension would be more equitable and
would maximize the amount of ACG
funds awarded to students who did not
receive or were ineligible for some
portion of his or her first- or second-year
award. The Department considered
providing that a first-year student,
enrolled in an ACG-eligible certificate
program of at least one academic year,
but less than two academic years, in
length would continue to be considered
a first-year student until he or she
completes the certificate program.
Similarly, the Department also
considered providing that a second-year
student, enrolled in an ACG-eligible
certificate or associate’s degree program
of at least two academic years in length,
would continue to be considered a
second-year student until he or she
completes the program. An analysis of
this alternative indicated it would
increase program costs by $16 million
over award years 2009–10 and 2010–11.
Given the lack of an offset for these
increased costs, the Department decided
to make no change to the interim final
regulations to adopt this alternative.
Transfers
These final regulations broaden access
to the ACG and National SMART Grant
programs by implementing statutory
changes that extend eligibility to parttime students who are enrolled at their
institution on at least a half-time basis,
eligible noncitizens, and students
enrolled in certain certificate programs.
The final regulations also allow eligible
degree programs with at least five full
undergraduate years to award National
SMART Grant awards in the third,
fourth, and fifth years of the program.
Mandatory funding for the ACG and
National SMART Grant programs is
provided through fiscal year 2010, after
which the program will sunset. Funds
for fiscal year 2010 will be used to
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support the 2010–2011 award year. As
noted in the Regulatory Impact Analysis
in the interim final regulations, the
Department estimates changes
implemented through these regulations
will result in 538,000 additional awards
totaling $448 million over award years
2009–2010 and 2010–2011. More
specifically, under current estimates,
expanding eligibility to less-than-fulltime students, eligible noncitizens, and
students at certificate programs will
increase ACG awards by 209,000 in
2009–2010 and 241,000 in 2010–2011
and increase National SMART Grant
awards by 43,000 in 2009–2010 and
45,000 in 2010–2011.
As noted in the Regulatory Impact
Analysis in the interim final regulations,
those changes, which are adopted as
final through this notice, implement
statutory changes replacing the term
‘‘academic year’’ with the term ‘‘year’’
for the purposes of determining a
student’s period of eligibility for an
ACG or a National SMART Grant. These
changes are expected to significantly
simplify the process of determining
eligibility for participating institutions
of higher education and students.
As noted, statutory changes in
program eligibility criteria implemented
by these final regulations will increase
the dollar amount of grant awards under
the ACG and National SMART Grant
programs by $448 million over award
years 2009–2010 and 2010–2011. These
changes will increase Federal costs by
the same amount.
Because institutions of higher
education affected by these final
regulations already participate in the
ACG and National SMART Grant
programs, these schools must have
already established systems and
procedures to meet program eligibility
requirements. These final regulations
reflect discrete changes in specific
parameters associated with the
Department’s current regulations for
these programs, rather than entirely new
requirements. Some of these changes,
such as those replacing ‘‘academic year’’
with ‘‘year’’ for the purposes of
determining program eligibility, are
expected to significantly simplify
program administration. Overall, the
Department believes entities continuing
to participate in the Pell Grant, ACG,
and National SMART Grant programs
have already absorbed virtually all of
the administrative costs related to
implementing these final regulations.
Marginal costs over this baseline are
primarily related to one-time changes
that are not expected to be significant.
Elsewhere in this SUPPLEMENTARY
INFORMATION section, we identify and
explain burdens specifically associated
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in overall burden; most individual
institutions are expected to see burden
reduced as well. Due to data limitations,
however, the Department was unable to
Accounting Statement
develop burden estimates tailored
As required by OMB Circular A–4
specifically for small institutions. These
(available at http://
institutions may be more likely to have
www.Whitehouse.gov/omb/Circulars/
unique problems, such as limited staff
a004/a-4.pdf), in Table 1, we have
or technical resources, which could lead
prepared an accounting statement
to greater than normal difficulties in
showing the classification of the
implementing these regulations. In
expenditures associated with the
general, however, the Department
provisions of these final regulations. As believes that even for most small
previously noted, the Department
institutions, the impact of regulations
estimates changes implemented through that simplify program requirements or
these regulations will result in 538,000
otherwise reduce burden will more than
additional awards totaling $448 million offset any additional burden associated
over award years 2009–2010 and 2010–
with changes expected to increase the
2011. Thus, the Department estimates
number of applicants. Given that, and
that the annualized monetized transfers the small number of affected entities
from Federal grant payments to students meeting the SBA guidelines, the
will be $224 million for 2009–2011.
Department has determined that these
final regulations do not impose
TABLE 1—ACCOUNTING STATEMENT: significant new costs on a substantial
CLASSIFICATION OF ESTIMATED SAV- number of entities.
INGS
Specific burden concerns are
discussed in more detail elsewhere in
[In millions]
this preamble, primarily in the
Paperwork Reduction Act of 1995
Category
Transfers
section.
with information collection
requirements. See the heading
Paperwork Reduction Act of 1995.
Annualized Monetized Transfers ........................................
$224
Regulatory Flexibility Act Certification
The Secretary certifies that these final
regulations will not have a significant
economic impact on a substantial
number of small entities. These final
regulations affect institutions of higher
education, States, State agencies, and
individual students. The U.S. Small
Business Administration (SBA) Size
Standards define these institutions as
‘‘small entities’’ if they are for-profit or
nonprofit institutions with total annual
revenue below $5,000,000 or if they are
institutions controlled by governmental
entities with populations below 50,000.
Individuals are not defined as ‘‘small
entities’’ under the Regulatory
Flexibility Act.
Based on revenue data from the
Integrated Postsecondary Education
Data System, less than 10 percent of the
schools participating in the ACG and
National SMART Grant programs meet
the definition of ‘‘small entities’’ (279
out of 3,036). A primary factor limiting
the number of small institutions in these
programs is the requirement that only
degree-granting institutions may offer
ACG or SMART Grants. A
disproportionate number of Title IV
schools meeting the SBA definition are
vocational institutions that do not offer
degrees.
The Department estimates these
regulations will result in a net reduction
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Paperwork Reduction Act of 1995
Sections 691.15 and 691.16 contain
information collection requirements.
Under the Paperwork Reduction Act of
1995 (44 U.S.C. 3507(d)), the
Department has submitted a copy of
these sections to OMB for its review.
Section 691.15(a)—Eligibility To Receive
a Grant
The final regulations amend the
eligibility requirements to receive an
ACG or a National SMART Grant by
removing several restrictive criteria.
Prior to July 1, 2009, which was the
effective date of this provision in the
HEOA, only students who were U.S.
citizens were eligible to receive an ACG
or a National SMART Grant. Under
these final regulations, and consistent
with other Title IV, HEA programs, in
addition to U.S. citizens, students who
can provide evidence from the United
States Citizenship and Immigration
Service, an office of the United States
Department of Homeland Security, that
they are in the United States for other
than a temporary purpose with the
intention of becoming a citizen or
permanent resident, may qualify as
eligible noncitizens for the ACG and
National SMART Grant programs.
The requirement that a student be
enrolled on a full-time basis is also
removed. Under these final regulations,
students enrolled on at least a half-time
or greater basis may be eligible to
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receive an ACG or a National SMART
Grant.
The final regulations provide that the
restriction on prior postsecondary
enrollment does not apply to students
who were enrolled as regular students
in an eligible program of undergraduate
education that was also part of a
secondary school program of study. We
also clarify that transfer students who
are first-year students are not
considered to have been previously
enrolled and, therefore, are not subject
to the prior enrollment restriction.
It is estimated that these changes
regarding student eligibility will result
in an increase in the burden hours
associated with the programs through
the Common Origination and
Disbursement (COD) System. We
estimate that the final regulations will
increase burden for institutions of
higher education by 12,412 hours, under
OMB Control Number 1845–0039.
Section 691.16—Rigorous Secondary
School Program of Study
The final regulations amend the
current regulations to provide that,
starting with the 2009–2010 award year,
a designated official, consistent with
State law, may recognize and report any
information to the Secretary about
rigorous secondary school programs of
study that prepare students for college.
These rigorous programs provide an
option by which a student could meet
the rigorous secondary school program
of study requirement for receipt of an
ACG.
Consistent with the amendments to
section 401A of the HEA, rigorous
programs submitted by States and
recognized by the Secretary as rigorous
after January 1, 2005, but before July 1,
2009, will continue to be listed in the
document published annually by the
Secretary listing rigorous secondary
school programs of study. This listing
also includes the new rigorous
secondary programs of study as reported
to the Department for students
graduating during the current award
year and for students graduating during
award years subsequent to the current
award year. In addition to any new
programs of study, the information that
designated officials report to the
Department about rigorous secondary
school programs of study also includes
changes to previously reported rigorous
programs of study or any deleted
rigorous programs of study. Consistent
with the deadline set by the Secretary
for reporting rigorous high school
programs to the Department, we expect
that 56 SEAs reporting for the State
(and/or on behalf of the State’s LEAs)
will be reporting to the Department
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16:40 Nov 20, 2009
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annually. In addition, designated
officials will report information
regarding the rigorous programs offered
by private and home schools for an
estimated 36,000 high school students
who attend private high schools and
home schools for the year of the
students’ secondary school graduation
or completion.
It is estimated that these changes
regarding reporting of rigorous
secondary school programs of study will
result in an increase in burden hours.
We estimate that the final regulations
will increase burden for States, private
high schools, home schools, and
individuals by 18,280 hours, under new
OMB Control Number 1845–0092.
Intergovernmental Review
These programs are subject to
Executive Order 12372 and the
regulations in 34 CFR part 79. One of
the objectives of the Executive order is
to foster an intergovernmental
partnership and a strengthened
federalism. The Executive Order relies
on processes developed by State and
local governments for coordination and
review of proposed Federal financial
assistance.
This document provides early
notification of our specific plans and
actions for this program.
Assessment of Educational Impact
We have determined that these final
regulations do not require transmission
of information that any other agency or
authority of the United States gathers or
makes available.
Electronic Access to This Document
You may view this document, as well
as all other Department of Education
documents published in the Federal
Register, in text or Adobe Portable
Document Format (PDF) on the Internet
at the following site: http://www.ed.gov/
news/fedregister.
To use PDF you must have Adobe
Acrobat Reader, which is available free
at this site. If you have questions about
using PDF, call the U.S. Government
Printing Office (GPO), toll free, at
1–888–293–6498; or in the Washington,
DC, area at (202) 512–1530.
You may also view this document in
PDF format at the following site:
http://www.ifap.ed.gov/ifap/index.jsp.
Note: The official version of this document
is the document published in the Federal
Register. Free Internet access to the official
edition of the Federal Register and the Code
of Federal Regulations is available on GPO
Access at: http://www.gpoaccess.gov/nara/
index.html.
(Catalog of Federal Domestic Assistance
Numbers: 84.063 Federal Pell Grants; 84.375
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61245
Academic Competitiveness Grants; 84.376
National SMART Grants; 84.379 TEACH
Grants)
List of Subjects in 34 CFR Parts 668,
686, 690, and 691
Colleges and universities, Elementary
and secondary education, Grant
programs—education, Student aid.
Dated: November 18, 2009.
Arne Duncan,
Secretary of Education.
For the reasons discussed in the
preamble, the interim final regulations
amending parts 668, 686, 690, and 691
of title 34 of the Code of Federal
Regulations that were published in the
Federal Register on May 1, 2009 (74 FR
20210) are adopted as final with the
following changes:
■
PART 690—FEDERAL PELL GRANT
PROGRAM
1. The authority citation for part 690
continues to read as follows:
■
Authority: 20 U.S.C. 1070a, unless
otherwise noted.
2. Section 690.63 is amended by
revising paragraph (d)(1) to read as
follows:
■
§ 690.63 Calculation of a Federal Pell
Grant for a payment period.
*
*
*
*
*
(d) * * *
(1) Determining his or her enrollment
status for the term;
*
*
*
*
*
PART 691—ACADEMIC
COMPETITIVENESS GRANT (ACG)
AND NATIONAL SCIENCE AND
MATHEMATICS ACCESS TO RETAIN
TALENT GRANT (NATIONAL SMART
GRANT) PROGRAMS
3. The authority citation for part 691
continues to read as follows:
■
Authority: 20 U.S.C. 1070a–1, unless
otherwise noted.
4. Section 691.2(d) is amended by
revising paragraph (1) of the definition
of ‘‘Eligible program’’ to read as follows:
■
§ 691.2
Definitions.
*
*
*
*
*
(d) * * *
Eligible program: * * *
(1) For purposes of the ACG
Program—
(i) Is an undergraduate program of at
least one academic year, but less than
two academic years, in length that leads
to a certificate at a two- or four-year
degree-granting institution of higher
education;
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(ii) Is an undergraduate program of at
least two academic years in length that
leads to a certificate at a two- or fouryear degree-granting institution of
higher education;
(iii) Leads to an associate’s degree or
a bachelor’s degree;
(iv) Is at least a two-academic-year
program acceptable for full credit
toward a bachelor’s degree; or
(v) Is a graduate degree program that
includes at least three years of
undergraduate education; or
*
*
*
*
*
[FR Doc. E9–28050 Filed 11–20–09; 8:45 am]
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Agencies
[Federal Register Volume 74, Number 224 (Monday, November 23, 2009)]
[Rules and Regulations]
[Pages 61240-61246]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E9-28050]
[[Page 61239]]
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Part III
Department of Education
-----------------------------------------------------------------------
34 CFR Parts 668, 686, 690, and 691
Student Assistance General Provisions; Teacher Education Assistance for
College and Higher Education (TEACH) Grant Program; Federal Pell Grant
Program; Academic Competitiveness Grant Program and National Science
and Mathematics Access To Retain Talent Grant Program; Final Rule
Federal Register / Vol. 74 , No. 224 / Monday, November 23, 2009 /
Rules and Regulations
[[Page 61240]]
-----------------------------------------------------------------------
DEPARTMENT OF EDUCATION
34 CFR Parts 668, 686, 690, and 691
RIN 1840-AC96
[Docket ID ED-2009-OPE-0001]
Student Assistance General Provisions; Teacher Education
Assistance for College and Higher Education (TEACH) Grant Program;
Federal Pell Grant Program; Academic Competitiveness Grant Program and
National Science and Mathematics Access To Retain Talent Grant Program
AGENCY: Office of Postsecondary Education, Department of Education.
ACTION: Final regulations.
-----------------------------------------------------------------------
SUMMARY: The Secretary is adopting as final, with changes, interim
final regulations for the Academic Competitiveness (ACG) and National
Science and Mathematics to Retain Talent Grant (National SMART Grant)
programs; Student Assistance General Provisions; Federal Pell Grant
Program; and Teacher Education Assistance for College and Higher
Education (TEACH) Grant Program. These final regulations are needed to
implement provisions of the Higher Education Act of 1965 (HEA), as
amended by the Ensuring Continued Access to Student Loans Act of 2008
(ECASLA) and the Higher Education Opportunity Act of 2008 (HEOA). The
new statutory provisions became effective July 1, 2009.
DATES: These regulations are effective January 22, 2010.
FOR FURTHER INFORMATION CONTACT:
------------------------------------------------------------------------
Topic Contact person and information
------------------------------------------------------------------------
General information and information Sophia McArdle. Telephone:
related to rigorous secondary school (202) 219-7078 or via the
programs and eligible majors. Internet:
sophia.mcardle@ed.gov.
Information related to grade level Fred Sellers. Telephone: (202)
progression. 502-7502 or via the Internet:
fred.sellers@ed.gov.
Information related to payments for Jacquelyn Butler. Telephone:
part-time students. (202) 502-7890 or via the
Internet:
jacquelyn.butler@ed.gov.
Information related to prior enrollment Carney McCullough. Telephone:
(202) 502-7639 or via the
Internet:
carney.mccullough@ed.gov.
------------------------------------------------------------------------
If you use a telecommunications device for the deaf (TDD), call the
Federal Relay Service (FRS), toll free, at 1-800-877-8339.
Individuals with disabilities can obtain this document in an
accessible format (e.g., braille, large print, audiotape, or computer
diskette) on request to the first contact person listed under FOR
FURTHER INFORMATION CONTACT.
SUPPLEMENTARY INFORMATION: On May 1, 2009, the Secretary published
interim final regulations for the ACG and National SMART Grant Programs
in the Federal Register (74 FR 20210). The interim final regulations
became effective July 1, 2009. At the time the interim final
regulations were published, the Secretary requested public comment on
whether changes to the regulations were warranted.
In the preamble to the interim final regulations, the Secretary
discussed, on pages 20210 through 20218, the major issues covered by
the regulations. The following paragraphs summarize those issues and
identify the relevant sections of the interim final regulations:
The Secretary amended the definition of the term ACG Scheduled
Award to be the maximum amount of an ACG that would be paid to a full-
time first-year student or a full-time second-year student for the
applicable year. A National SMART Grant Scheduled Award was defined as
the maximum amount of a National SMART Grant that would be paid to a
full-time third-year, fourth-year, or fifth-year student for the
applicable year (see Sec. 691.2(d)).
In Sec. 691.2(d), the Secretary defined the term annual award to
be the maximum ACG or National SMART Grant amount a student would
receive for enrolling as a full-time, three-quarter-time, or half-time
student and remaining in that enrollment status for one year.
The Secretary amended the definition of the term eligible major in
Sec. 691.2(d) to include, in addition to majors in physical, life, or
computer sciences, mathematics, technology, engineering or a critical
foreign language, a qualifying liberal arts curriculum as determined by
the Secretary.
The Secretary amended the definition of the term eligible program
to include, for the ACG program, an undergraduate certificate program
of at least one academic year in length and, for the National SMART
Grant program, a degree program with at least five full undergraduate
years of coursework at a degree-granting institution of higher
education (see Sec. 691.2(d)).
In Sec. 691.2(e), the Secretary defined the terms first-year,
second-year, third-year fourth-year, and fifth-year as a student's
grade level in the student's eligible program as determined by the
institution for all students in the eligible program.
The Secretary amended the method by which the duration of student
eligibility was determined, by basing eligibility on a student's grade
level, rather than on the student's academic year (see Sec. Sec.
691.2(d) and 691.6). In Sec. 691.6(b)(2), the Secretary provided that
a fourth-year student enrolled in a National SMART Grant-eligible
program with less than five full years of coursework continues to be
considered a fourth-year student for purposes of the National SMART
Grant program until he or she completes his or her first undergraduate
baccalaureate course of study, and that a fifth-year student, enrolled
in a National SMART Grant-eligible program with a least five full years
of coursework, continues to be considered a fifth-year student until he
or she completes his or her first undergraduate baccalaureate course of
study.
In Sec. 691.8, the Secretary detailed how correspondence courses
would be applied toward a student's enrollment status (i.e., as a half-
time, three-quarter-time, and full-time student) in an eligible
program.
The Secretary removed the provisions from Sec. 691.15(a) that
stated that eligibility for ACGs and National SMART Grants is limited
to U.S. citizens and students who are enrolled full-time.
[[Page 61241]]
With respect to eligibility for a first-year ACG, the Secretary
provided that the restriction on prior enrollment does not apply to
students who were enrolled as regular students in an eligible program
of undergraduate education that was also part of a secondary school
program of study, and clarified that transfer students who are first-
year students are not considered to have been previously enrolled and,
therefore, are not subject to the prior enrollment restriction (Sec.
691.15(b)(1)(ii)(C)).
The Secretary amended Sec. 691.16 to provide that starting with
the 2009-2010 award year, a designated official, consistent with State
law, may recognize and report to the Secretary any secondary school
programs of study that prepare students for college and that the
designated official deems rigorous. These programs supplement the
secondary school programs previously recognized by the Secretary as
rigorous. It is no longer the Secretary's role to recognize secondary
school programs of study as rigorous.
The Secretary exempted a student enrolled in a qualifying liberal
arts curriculum from the requirement that the student must declare an
eligible major to receive a National SMART Grant and provided that an
institution need only document a student's progress in completing the
program in the intended or declared National SMART Grant-eligible
program (Sec. Sec. 691.15(d)(3) and 691.15(e)).
The Secretary amended the regulations to provide that an eligible
major includes any ``critical foreign language'' found in section
103(3) of the HEA, rather than critical foreign languages identified by
the Secretary after consulting with the Director of National
Intelligence. The Secretary also amended the regulations to provide
that an eligible major includes qualifying liberal arts curricula and
to describe the process by which an institution requests designation of
a liberal arts curriculum as an eligible major.
In Sec. 691.62, the Secretary set the ACG and National SMART Grant
annual award amounts for full-time, three-quarter-time, and half-time
students. The annual award for a full-time student is the same amount
as the student's Scheduled Award.
The Secretary described in Sec. Sec. 691.63 and 691.66 how ACG and
National SMART Grant payments for a payment period must be calculated
for full-time, three-quarter-time, and half-time students as well as
for students in a program of study offered by correspondence.
The Secretary amended Sec. 691.63(h) to provide that a student may
not progress to the next year in a grade level (rather than next
academic year) during a payment period.
Analysis of Comments and Changes
The final regulations in this document were developed through the
analysis of the two comments we received on the interim final
regulations published on May 1, 2009. An analysis of the comments and
of the changes to the regulations since publication of the interim
final regulations follows. We group major issues according to subject,
with appropriate sections of the regulations referenced in parentheses.
Generally, we do not address technical and other minor changes.
General Comment
Comment: One commenter supported the interim final regulations,
citing in particular its approval of the definitions of annual award,
first-year, second-year, third-year, fourth-year, and fifth-year, the
requirement that the grade level used for purposes of awarding ACG and
National SMART Grant funds be the same grade level used for determining
annual loan limits under the Federal Family Education Loan (FFEL)
Program and the William D. Ford Federal Direct Loan (Direct Loan)
Program, and the provisions governing enrollment status and student
eligibility that allow students enrolled less than full-time but at
least half-time to be eligible for ACG and National SMART Grants.
Discussion: The Secretary appreciates the support of the commenter.
Changes: None.
Definitions (Sec. 691.2)
Eligible Program (Sec. 691.2(d))
Comment: One commenter was concerned that, under the definition of
the term eligible program in Sec. 691.2(d), a five-year program that
is a qualifying liberal arts curriculum identified as an eligible major
under Sec. 691.17(b) would not qualify as a National SMART Grant-
eligible program. The commenter believed that the HEA does not
disqualify a five-year program from eligibility and that a student in
such a program would be eligible for a third- and fourth-year National
SMART Grant.
Discussion: We do not agree with the commenter. Section
401A(c)(3)(E) of the HEA specifies that a student can receive a fifth-
year National SMART Grant if he or she is enrolled in a program
requiring five full years of coursework for which a baccalaureate
degree is awarded in the physical, life, or computer sciences,
mathematics, technology, engineering, or a critical foreign language.
Section 401A(c)(3)(D) of the HEA contains National SMART Grant
eligibility requirements for students enrolled in a liberal arts
curriculum, providing that such curriculum must consist of at least
four years of study in mathematics and three years of study in the
sciences, with a laboratory requirement in each of those years or that
the student study a subject that is at least equal to the requirements
for an academic major at an institution that offers a baccalaureate
degree in that subject. While section 401A(c)(3)(D) of the HEA does not
explicitly state that a qualified liberal arts curriculum may not be a
five year program, we find it to be implicit, based on the structure of
section 401(c)(3) and because section 401A(c)(3)(E) of the HEA,
covering fifth-year National SMART Grant eligibility, does not include
liberal arts curricula as a major for which a student may earn a fifth-
year grant.
Changes: None.
Comments: One commenter noted that the definition of the term
eligible program for purposes of the ACG Program incorporates
certificate programs but does not specify that certificate programs
must be offered by degree-granting institutions of higher education.
Discussion: We agree with the commenter that a certificate program
is an eligible program only if it is offered at a two-year or four-year
degree-granting institution. Section 401A(c)(3)(A) of the HEA provides
that an eligible student that receives a first-year ACG award must be
enrolled or accepted for enrollment in the first year of a program of
undergraduate education at a two- or four-year degree-granting
institution of higher education, ``including a program of not less than
one year for which the institution awards a certificate.'' To receive a
second year ACG in accordance with section 401A(c)(3)(B) of the HEA, an
eligible student must be enrolled or accepted for enrollment in the
second year of a program of undergraduate education at a two- or four-
year degree-granting institution of higher education, ``including a
program of not less than two years for which the institution awards a
certificate.''
Changes: We have amended the definition of the term eligible
program in Sec. 691.2(d) to provide that, for purposes of the ACG
Program, an undergraduate program of at least one academic year in
length that leads to a certificate must be offered by a two-year or
four-year degree-granting institution of higher education for a first-
year ACG. Also, we have clarified in this definition that, for a
second-year ACG, an eligible program is an undergraduate program of
[[Page 61242]]
at least two academic years in length that leads to a certificate or
associate degree and is offered by a two-year or four-year degree-
granting institution of higher education.
Duration of Student Eligibility--Undergraduate Course of Study (Sec.
691.6)
Comment: One commenter supported the provisions in Sec. 691.6(b)
that extend the National SMART Grant eligibility of a student in the
final year of a student's four- or five-year program until the student
graduates. Under these provisions, a student enrolled in a National
SMART Grant-eligible program with less than five full years of
coursework in the case of a fourth-year student, or with at least five
full years of coursework in the case of a fifth-year student, remains a
fourth- or fifth-year student respectively until the completion of his
or her undergraduate baccalaureate course of study. The commenter
encouraged the Department to adopt the same policy for students
enrolled in associate degree programs and questioned whether the policy
would also apply to certificate programs.
The commenter also believed that under Sec. 691.6 a student
enrolled in a certificate program that is longer than one academic year
in length would be eligible for a second-year ACG. For example, an
eligible student enrolled in a program that is 45 credit hours and 45
weeks of instructional time in length would receive the maximum first-
year ACG as well as half of a second-year ACG. The commenter further
questioned whether that student could ever be eligible to receive more
than half of a second-year ACG.
The commenter also stated that in the loan programs, a student
enrolled in a program that is one academic year in length could never
receive funds at second-year loan limits regardless of how long it took
the student to complete the program. The commenter questioned whether a
student who took more than one academic year to complete a one-year
certificate program would ever be eligible to receive any portion of a
second-year ACG for the extra time it took to complete the program.
Discussion: We appreciate the commenter's support of the change in
the regulations that extends a student's eligibility for a National
SMART Grant award for a fourth- and fifth-year student until the
student completes his or her first undergraduate baccalaureate course
of study. We also appreciate the commenter's recommendation that the
regulations should extend the final year of eligibility to students
enrolled in one-academic-year certificate programs or two-academic-year
certificate or associate degree programs. However, to provide the
extensions for shorter educational programs would result in an
estimated increase in program costs of $16 million over the final two
years of the ACG and National SMART Grant programs. To make the
changes, we would need to identify savings to offset the cost increase.
We have been unable to identify any offsetting savings.
We do not agree with the commenter's assessment that a student
enrolled in a program that is 45 credit hours and 45 weeks of
instructional time in length would be eligible for half of a second-
year ACG. The student in that example would only qualify for a full
first-year ACG. Section 401A(c)(3)(D) of the HEA provides that a
student may be eligible for a second-year ACG if he or she is enrolled
in a certificate program of not less than two years. Although the
program in the example is longer than one-academic year in length, the
student would not qualify for any portion of the second-year ACG
because the program is less than two academic years in length. The
program is an eligible program only for a first-year ACG.
We note that in some cases, under the FFEL and Direct Loan
programs, a student in a certificate or associate degree program that
extends to a third-year grade level may receive funds at the third-year
annual loan limits. For purposes of ACG, as a third-year student, the
student would not qualify for funds from a second-year ACG.
Changes: None.
Eligibility To Receive a Grant (Sec. 691.15)
Comments: One commenter noted that a student who enters college
with a full year of credit from Advanced Placement (AP) or
International Baccalaureate (IB) coursework will not have a grade point
average (GPA), and therefore cannot qualify for a second-year ACG
because he or she cannot meet the minimum 3.0 GPA required to receive
an ACG. The commenter suggested that the Department allow the AP or IB
exam scores to satisfy the GPA requirement, or allow the final high
school GPA to be used, or provide some other method by which an
equivalency for the GPA could be determined.
Discussion: Section 401A(c)(3)(B)(ii) of the HEA specifies that to
receive a second-year ACG, a student must obtain a cumulative GPA of at
least 3.0 (or the equivalent as determined under regulations prescribed
by the Secretary) at the end of the first year of the program of
undergraduate education. The statute does not allow for any other GPA,
such as a final high school GPA, to satisfy the 3.0 GPA requirement.
With respect to AP or IB exam scores, there is no standardized
methodology for equating AP or IB exam scores with undergraduate
grades. Regulations for determining the numeric equivalent at
institutions of higher education that assess GPA on a numeric scale
other than a 4.0 scale were previously published. In the case of
credits that are awarded when no postsecondary coursework has been
completed, the Secretary believes that it is not possible to determine
a numeric equivalent, and therefore agrees with the commenter that a
student in this circumstance cannot qualify for a second-year ACG
because he or she cannot meet the minimum 3.0 GPA required to receive
an ACG.
Changes: None.
Comment: One commenter commended the Secretary for eliminating from
Sec. 691.15(e) the requirement that the institution document a
student's progress in his or her major each term. The same commenter
stated that any requirement to document progress in the student's
program outside of normal satisfactory academic progress is unnecessary
and meaningless and recommended deleting all of Sec. 691.15(e).
Discussion: The commenter misunderstood the interim final
regulations. The Secretary did not eliminate the requirement to
document progress in the major for each term. Rather, the interim final
regulations removed the requirement in Sec. 691.15(c)(2)(ii) that a
student enroll in courses necessary both to complete the degree program
and fulfill the requirements of the eligible major each payment period,
and that the institution document that enrollment. Section 691.15(e)
continues to require an institution to document a student's progress in
taking the courses necessary to complete the National SMART Grant-
eligible program in the intended or declared major. The Secretary does
not agree that documenting progress in the student's program beyond
that required to show a student's satisfactory academic progress under
Sec. 668.34(e) is unnecessary or meaningless. National SMART Grant
eligibility is determined each payment period, and institutions must
document that a student achieved at least a 3.0 cumulative GPA for each
payment period. Under the satisfactory academic progress regulations in
Sec. 668.34(e), an institution is required to review a student's
academic progress only at the end of each year. Because eligibility for
a National SMART Grant is determined each payment period, an annual
review would be insufficient to
[[Page 61243]]
ensure that a student continues to make the necessary progress in his
or her National SMART Grant-eligible program for every payment period.
Changes: None.
Calculation of a Grant for a Payment Period (Sec. 691.63(h))
Comment: One commenter questioned whether it was appropriate to
provide that a student may not progress to the next grade level during
a payment period, as was previously required when progression was based
on a student's academic year. The commenter noted various reasons why a
student's grade level may change during a payment period, including
error, late grade submission, or late arriving transcripts from other
institutions. The commenter believed that we should treat a student's
grade level change made during a payment period similarly to the way we
treat grade level changes for purposes of determining annual loan
limits under the FFEL and Direct Loan programs.
Discussion: While a student's grade level may change during a
payment period for a variety of reasons, a student can only be eligible
for payment from one Scheduled Award during the payment period. This
circumstance is fundamentally different from the application of annual
loan limits that are not applied on the same basis as determining
Scheduled Awards for ACG and National SMART Grants. Except in the case
of an institutional error, we believe that a Scheduled Award based on a
student's grade level at the outset of the payment period is the most
appropriate Scheduled Award for determining the student's eligibility
for payment. If, due to an institutional error, an incorrect grade
level was the basis for determining the student's award, the
institution must correct the error and adjust the student's award based
on the correct grade level.
Changes: None.
Calculation of a Federal Pell Grant for a Payment Period (Sec.
690.63(d))
Comment: None.
Discussion: In reviewing the interim final regulations, we
identified an error in the amendatory language related to Sec.
690.63(d). Specifically, we inadvertently amended Sec. 690.63(d)(1)(i)
instead of Sec. 690.63(d)(1).
Changes: We are correcting the error by amending Sec.
690.63(d)(1), so that it is consistent with Sec. 691.63(d)(1), which
governs calculation of an ACG or National SMART Grant for a payment
period.
Executive Order 12866
1. Regulatory Impact Analysis
Under Executive Order 12866, the Secretary must determine whether
the regulatory action is ``significant'' and therefore subject to the
requirements of the Executive order and subject to review by the Office
of Management and Budget (OMB). Section 3(f) of Executive Order 12866
defines a ``significant regulatory action'' as an action likely to
result in a rule that may (1) have an annual effect on the economy of
$100 million or more, or adversely affect a sector of the economy,
productivity, competition, jobs, the environment, public health or
safety, or State, local or tribal governments or communities in a
material way (also referred to as an ``economically significant''
rule); (2) create serious inconsistency or otherwise interfere with an
action taken or planned by another agency; (3) materially alter the
budgetary impacts of entitlement grants, user fees, or loan programs or
the rights and obligations of recipients thereof; or (4) raise novel
legal or policy issues arising out of legal mandates, the President's
priorities, or the principles set forth in the Executive order.
Pursuant to the terms of the Executive order, it has been
determined that this final regulatory action will have an annual effect
on the economy of more than $100 million. Therefore, this action is
``economically significant'' and subject to OMB review under section
3(f)(1) of Executive Order 12866.
Need for Federal Regulatory Action
As discussed in the interim final regulations, these regulations
address a range of issues affecting students and institutions of higher
education participating in the ACG and National SMART Grant programs.
They are needed to implement statutory changes enacted through the
ECASLA and the HEOA.
Regulatory Alternatives Considered
Alternatives to the regulations were considered as part of the
rulemaking process. These alternatives were reviewed in detail in the
preamble to the interim final regulations under both the Regulatory
Impact Analysis and the Reasons sections accompanying the discussion of
each proposed regulatory provision. To the extent that they were
addressed in response to comments received on the interim final
regulations, alternatives are also considered elsewhere in the preamble
to these final regulations under the Discussion sections related to
each provision. No comments were received related to the Regulatory
Impact Analysis discussion of these alternatives.
As discussed above in the Analysis of Comments and Changes section,
the final regulations reflect statutory amendments included in the HEOA
and minor revisions in response to public comments. None of these
changes result in revisions to cost estimates prepared for and
discussed in the Regulatory Impact Analysis of the interim final
regulations.
One alternative suggested by a commenter that was considered
involved extending the final year of eligibility for students enrolled
in one-academic-year certificate programs or two-academic-year
certificate or associate degree programs. A commenter argued that such
an extension would be more equitable and would maximize the amount of
ACG funds awarded to students who did not receive or were ineligible
for some portion of his or her first- or second-year award. The
Department considered providing that a first-year student, enrolled in
an ACG-eligible certificate program of at least one academic year, but
less than two academic years, in length would continue to be considered
a first-year student until he or she completes the certificate program.
Similarly, the Department also considered providing that a second-year
student, enrolled in an ACG-eligible certificate or associate's degree
program of at least two academic years in length, would continue to be
considered a second-year student until he or she completes the program.
An analysis of this alternative indicated it would increase program
costs by $16 million over award years 2009-10 and 2010-11. Given the
lack of an offset for these increased costs, the Department decided to
make no change to the interim final regulations to adopt this
alternative.
Transfers
These final regulations broaden access to the ACG and National
SMART Grant programs by implementing statutory changes that extend
eligibility to part-time students who are enrolled at their institution
on at least a half-time basis, eligible noncitizens, and students
enrolled in certain certificate programs. The final regulations also
allow eligible degree programs with at least five full undergraduate
years to award National SMART Grant awards in the third, fourth, and
fifth years of the program. Mandatory funding for the ACG and National
SMART Grant programs is provided through fiscal year 2010, after which
the program will sunset. Funds for fiscal year 2010 will be used to
[[Page 61244]]
support the 2010-2011 award year. As noted in the Regulatory Impact
Analysis in the interim final regulations, the Department estimates
changes implemented through these regulations will result in 538,000
additional awards totaling $448 million over award years 2009-2010 and
2010-2011. More specifically, under current estimates, expanding
eligibility to less-than-full-time students, eligible noncitizens, and
students at certificate programs will increase ACG awards by 209,000 in
2009-2010 and 241,000 in 2010-2011 and increase National SMART Grant
awards by 43,000 in 2009-2010 and 45,000 in 2010-2011.
As noted in the Regulatory Impact Analysis in the interim final
regulations, those changes, which are adopted as final through this
notice, implement statutory changes replacing the term ``academic
year'' with the term ``year'' for the purposes of determining a
student's period of eligibility for an ACG or a National SMART Grant.
These changes are expected to significantly simplify the process of
determining eligibility for participating institutions of higher
education and students.
As noted, statutory changes in program eligibility criteria
implemented by these final regulations will increase the dollar amount
of grant awards under the ACG and National SMART Grant programs by $448
million over award years 2009-2010 and 2010-2011. These changes will
increase Federal costs by the same amount.
Because institutions of higher education affected by these final
regulations already participate in the ACG and National SMART Grant
programs, these schools must have already established systems and
procedures to meet program eligibility requirements. These final
regulations reflect discrete changes in specific parameters associated
with the Department's current regulations for these programs, rather
than entirely new requirements. Some of these changes, such as those
replacing ``academic year'' with ``year'' for the purposes of
determining program eligibility, are expected to significantly simplify
program administration. Overall, the Department believes entities
continuing to participate in the Pell Grant, ACG, and National SMART
Grant programs have already absorbed virtually all of the
administrative costs related to implementing these final regulations.
Marginal costs over this baseline are primarily related to one-time
changes that are not expected to be significant.
Elsewhere in this SUPPLEMENTARY INFORMATION section, we identify
and explain burdens specifically associated with information collection
requirements. See the heading Paperwork Reduction Act of 1995.
Accounting Statement
As required by OMB Circular A-4 (available at http://www.Whitehouse.gov/omb/Circulars/a004/a-4.pdf), in Table 1, we have
prepared an accounting statement showing the classification of the
expenditures associated with the provisions of these final regulations.
As previously noted, the Department estimates changes implemented
through these regulations will result in 538,000 additional awards
totaling $448 million over award years 2009-2010 and 2010-2011. Thus,
the Department estimates that the annualized monetized transfers from
Federal grant payments to students will be $224 million for 2009-2011.
Table 1--Accounting Statement: Classification of Estimated Savings
[In millions]
------------------------------------------------------------------------
Category Transfers
------------------------------------------------------------------------
Annualized Monetized Transfers............................ $224
------------------------------------------------------------------------
Regulatory Flexibility Act Certification
The Secretary certifies that these final regulations will not have
a significant economic impact on a substantial number of small
entities. These final regulations affect institutions of higher
education, States, State agencies, and individual students. The U.S.
Small Business Administration (SBA) Size Standards define these
institutions as ``small entities'' if they are for-profit or nonprofit
institutions with total annual revenue below $5,000,000 or if they are
institutions controlled by governmental entities with populations below
50,000. Individuals are not defined as ``small entities'' under the
Regulatory Flexibility Act.
Based on revenue data from the Integrated Postsecondary Education
Data System, less than 10 percent of the schools participating in the
ACG and National SMART Grant programs meet the definition of ``small
entities'' (279 out of 3,036). A primary factor limiting the number of
small institutions in these programs is the requirement that only
degree-granting institutions may offer ACG or SMART Grants. A
disproportionate number of Title IV schools meeting the SBA definition
are vocational institutions that do not offer degrees.
The Department estimates these regulations will result in a net
reduction in overall burden; most individual institutions are expected
to see burden reduced as well. Due to data limitations, however, the
Department was unable to develop burden estimates tailored specifically
for small institutions. These institutions may be more likely to have
unique problems, such as limited staff or technical resources, which
could lead to greater than normal difficulties in implementing these
regulations. In general, however, the Department believes that even for
most small institutions, the impact of regulations that simplify
program requirements or otherwise reduce burden will more than offset
any additional burden associated with changes expected to increase the
number of applicants. Given that, and the small number of affected
entities meeting the SBA guidelines, the Department has determined that
these final regulations do not impose significant new costs on a
substantial number of entities.
Specific burden concerns are discussed in more detail elsewhere in
this preamble, primarily in the Paperwork Reduction Act of 1995
section.
Paperwork Reduction Act of 1995
Sections 691.15 and 691.16 contain information collection
requirements. Under the Paperwork Reduction Act of 1995 (44 U.S.C.
3507(d)), the Department has submitted a copy of these sections to OMB
for its review.
Section 691.15(a)--Eligibility To Receive a Grant
The final regulations amend the eligibility requirements to receive
an ACG or a National SMART Grant by removing several restrictive
criteria. Prior to July 1, 2009, which was the effective date of this
provision in the HEOA, only students who were U.S. citizens were
eligible to receive an ACG or a National SMART Grant. Under these final
regulations, and consistent with other Title IV, HEA programs, in
addition to U.S. citizens, students who can provide evidence from the
United States Citizenship and Immigration Service, an office of the
United States Department of Homeland Security, that they are in the
United States for other than a temporary purpose with the intention of
becoming a citizen or permanent resident, may qualify as eligible
noncitizens for the ACG and National SMART Grant programs.
The requirement that a student be enrolled on a full-time basis is
also removed. Under these final regulations, students enrolled on at
least a half-time or greater basis may be eligible to
[[Page 61245]]
receive an ACG or a National SMART Grant.
The final regulations provide that the restriction on prior
postsecondary enrollment does not apply to students who were enrolled
as regular students in an eligible program of undergraduate education
that was also part of a secondary school program of study. We also
clarify that transfer students who are first-year students are not
considered to have been previously enrolled and, therefore, are not
subject to the prior enrollment restriction.
It is estimated that these changes regarding student eligibility
will result in an increase in the burden hours associated with the
programs through the Common Origination and Disbursement (COD) System.
We estimate that the final regulations will increase burden for
institutions of higher education by 12,412 hours, under OMB Control
Number 1845-0039.
Section 691.16--Rigorous Secondary School Program of Study
The final regulations amend the current regulations to provide
that, starting with the 2009-2010 award year, a designated official,
consistent with State law, may recognize and report any information to
the Secretary about rigorous secondary school programs of study that
prepare students for college. These rigorous programs provide an option
by which a student could meet the rigorous secondary school program of
study requirement for receipt of an ACG.
Consistent with the amendments to section 401A of the HEA, rigorous
programs submitted by States and recognized by the Secretary as
rigorous after January 1, 2005, but before July 1, 2009, will continue
to be listed in the document published annually by the Secretary
listing rigorous secondary school programs of study. This listing also
includes the new rigorous secondary programs of study as reported to
the Department for students graduating during the current award year
and for students graduating during award years subsequent to the
current award year. In addition to any new programs of study, the
information that designated officials report to the Department about
rigorous secondary school programs of study also includes changes to
previously reported rigorous programs of study or any deleted rigorous
programs of study. Consistent with the deadline set by the Secretary
for reporting rigorous high school programs to the Department, we
expect that 56 SEAs reporting for the State (and/or on behalf of the
State's LEAs) will be reporting to the Department annually. In
addition, designated officials will report information regarding the
rigorous programs offered by private and home schools for an estimated
36,000 high school students who attend private high schools and home
schools for the year of the students' secondary school graduation or
completion.
It is estimated that these changes regarding reporting of rigorous
secondary school programs of study will result in an increase in burden
hours. We estimate that the final regulations will increase burden for
States, private high schools, home schools, and individuals by 18,280
hours, under new OMB Control Number 1845-0092.
Intergovernmental Review
These programs are subject to Executive Order 12372 and the
regulations in 34 CFR part 79. One of the objectives of the Executive
order is to foster an intergovernmental partnership and a strengthened
federalism. The Executive Order relies on processes developed by State
and local governments for coordination and review of proposed Federal
financial assistance.
This document provides early notification of our specific plans and
actions for this program.
Assessment of Educational Impact
We have determined that these final regulations do not require
transmission of information that any other agency or authority of the
United States gathers or makes available.
Electronic Access to This Document
You may view this document, as well as all other Department of
Education documents published in the Federal Register, in text or Adobe
Portable Document Format (PDF) on the Internet at the following site:
http://www.ed.gov/news/fedregister.
To use PDF you must have Adobe Acrobat Reader, which is available
free at this site. If you have questions about using PDF, call the U.S.
Government Printing Office (GPO), toll free, at 1-888-293-6498; or in
the Washington, DC, area at (202) 512-1530.
You may also view this document in PDF format at the following
site: http://www.ifap.ed.gov/ifap/index.jsp.
Note: The official version of this document is the document
published in the Federal Register. Free Internet access to the
official edition of the Federal Register and the Code of Federal
Regulations is available on GPO Access at: http://www.gpoaccess.gov/nara/index.html.
(Catalog of Federal Domestic Assistance Numbers: 84.063 Federal Pell
Grants; 84.375 Academic Competitiveness Grants; 84.376 National
SMART Grants; 84.379 TEACH Grants)
List of Subjects in 34 CFR Parts 668, 686, 690, and 691
Colleges and universities, Elementary and secondary education,
Grant programs--education, Student aid.
Dated: November 18, 2009.
Arne Duncan,
Secretary of Education.
0
For the reasons discussed in the preamble, the interim final
regulations amending parts 668, 686, 690, and 691 of title 34 of the
Code of Federal Regulations that were published in the Federal Register
on May 1, 2009 (74 FR 20210) are adopted as final with the following
changes:
PART 690--FEDERAL PELL GRANT PROGRAM
0
1. The authority citation for part 690 continues to read as follows:
Authority: 20 U.S.C. 1070a, unless otherwise noted.
0
2. Section 690.63 is amended by revising paragraph (d)(1) to read as
follows:
Sec. 690.63 Calculation of a Federal Pell Grant for a payment period.
* * * * *
(d) * * *
(1) Determining his or her enrollment status for the term;
* * * * *
PART 691--ACADEMIC COMPETITIVENESS GRANT (ACG) AND NATIONAL SCIENCE
AND MATHEMATICS ACCESS TO RETAIN TALENT GRANT (NATIONAL SMART
GRANT) PROGRAMS
0
3. The authority citation for part 691 continues to read as follows:
Authority: 20 U.S.C. 1070a-1, unless otherwise noted.
0
4. Section 691.2(d) is amended by revising paragraph (1) of the
definition of ``Eligible program'' to read as follows:
Sec. 691.2 Definitions.
* * * * *
(d) * * *
Eligible program: * * *
(1) For purposes of the ACG Program--
(i) Is an undergraduate program of at least one academic year, but
less than two academic years, in length that leads to a certificate at
a two- or four-year degree-granting institution of higher education;
[[Page 61246]]
(ii) Is an undergraduate program of at least two academic years in
length that leads to a certificate at a two- or four-year degree-
granting institution of higher education;
(iii) Leads to an associate's degree or a bachelor's degree;
(iv) Is at least a two-academic-year program acceptable for full
credit toward a bachelor's degree; or
(v) Is a graduate degree program that includes at least three years
of undergraduate education; or
* * * * *
[FR Doc. E9-28050 Filed 11-20-09; 8:45 am]
BILLING CODE 4000-01-P