Postsecondary Educational Institutions Invited To Participate in Experiments Under the Experimental Sites Initiative, 66698-66707 [2011-27880]
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Federal Register / Vol. 76, No. 208 / Thursday, October 27, 2011 / Notices
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[FR Doc. 2011–27737 Filed 10–26–11; 8:45 am]
BILLING CODE 5001–06–P
DEPARTMENT OF EDUCATION
Postsecondary Educational
Institutions Invited To Participate in
Experiments Under the Experimental
Sites Initiative
Office of Postsecondary
Education, Department of Education.
ACTION: Notice.
AGENCY:
Overview Information: Federal
Student Financial Assistance Programs
under Title IV of the Higher Education
Act of 1965, as amended; notice inviting
postsecondary educational institutions
to participate in experiments under the
Experimental Sites Initiative.
SUMMARY: The Secretary invites
postsecondary educational institutions
(institutions) that participate in the
student assistance programs authorized
under Title IV of the Higher Education
Act of 1965, as amended (the HEA), to
apply to participate in one or more new
experiments under the Experimental
Sites Initiative (ESI), as authorized by
section 487A(b) of the HEA. Under
section 487A(b) the Secretary has the
authority to grant waivers from specific
Title IV, HEA statutory or regulatory
requirements to allow institutions to test
alternative methods for administering
the Title IV, HEA programs.
DATES: Applications to participate in
any experiment must be received by the
Department no later than December 12,
2011 in order for an institution to
receive priority to be considered for
participation in an experiment. Letters
of application received after December
12, 2011 may be considered for
participation at a later time.
ADDRESSES: Letters of application must
be submitted via electronic mail to the
following email address:
experimentalsites@ed.gov. For formats
and other required information, see
‘‘Instructions for Submitting Letters of
Application’’ under SUPPLEMENTARY
INFORMATION, below.
FOR FURTHER INFORMATION CONTACT:
Warren Farr, U.S. Department of
Education, Federal Student Aid, 830
First Street, NE., Washington, DC 20002.
Telephone: (202) 377–4380 or by email
at: Warren.Farr@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.
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SUPPLEMENTARY INFORMATION:
Instructions for Submitting Letters of
Application:
Letters of application should take the
form of a .PDF attachment to an email
message sent to the email address
provided in the ADDRESSES section of
this notice. The subject line of the email
should read ‘‘ESI—Request to
Participate.’’ The text of the email
should identify the experiment, or
experiments, the institution wishes to
participate in by number and title used
in the ‘‘The Experiments’’ paragraph
under SUPPLEMENTARY INFORMATION,
below (e.g., ‘‘Experiment 5—Direct Loan
Program—Unequal disbursements’’).
The letter of application should be on
institutional letterhead and be signed by
an official of the institution. The letter
must include the institution’s official
name and Department of Education
Office of Postsecondary Education
Identification (OPEID), as well as a
mailing address, email address, FAX
number, and telephone number of a
contact person at the institution.
Background:
This notice is the second notice
regarding the Experimental Sites
Initiative (ESI). The first, published in
the Federal Register on October 28,
2009 (74 FR 55542), solicited
suggestions from institutions for new
experiments under the ESI. The
Department received suggestions for
new experiments from institutions
representing all sectors of the
postsecondary education community.
This notice invites institutions to
request to participate in one or more of
the experiments described in this
notice.
Under the waiver authority granted
the Secretary under section 487A(b) of
the HEA, each experiment will be
designed to test whether proposed
changes to current requirements
improve the administration of the Title
IV programs. Substantiated
improvements as a result of an
experiment would provide a rationale
for policymakers to consider changing
the statutory or regulatory provision that
was the focus of the experiment.
The Department is interested in
gathering data under circumstances that
will allow for a reliable evaluation of
the experiments. Participating
institutions will be expected to gather
and report data needed by the
Department for this purpose. To support
recommendations for change, evidence
must be provided that was obtained
from both a treatment group of students
who participated in the experiment and
a control or comparison group of
students who received their student aid
under existing rules. As for any
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evaluation design, it is important that
the control or comparison group be as
similar as possible to the treatment
group.
Depending upon the experiment, the
control group could be a set of students
who otherwise meet the eligibility
requirements for the experiment but are
randomly selected to have their aid
administered under existing
requirements. Comparison groups could
include students from, for example, a
different but similar educational
program, a different but similar location
or campus, an earlier award year, or a
group that does not have the same need
for the treatment (e.g., they are not Pell
Grant eligible); but in all cases these
groups should be made up of students
as similar as possible to those in the
treatment group.
The Secretary intends to support
experiments where the Department can
draw causal inferences about the effects
of the alternative approach based on a
rigorous evaluation design. Examples of
the kinds of evaluation and research
designs that allow conclusions to be
drawn about the effects of an
intervention (program, policy, or
practice) can be found at ED’s What
Works Clearinghouse (https://ies.ed.gov/
ncee/wwc/).
Institutions may apply to participate
in one or more of the eight experiments
included in this notice and described
below. From the institutions that apply,
the Secretary will select only a limited
number to participate in each
experiment. The selection of
participating institutions will be guided
by the purpose of the ESI, which is, as
is provided for under section 487A(b),
to evaluate alternatives to current
requirements, and inform policymakers
about the possibility of changes to those
requirements. The ESI is not designed to
provide broad regulatory relief or
general exceptions to the statutory and
regulatory requirements. Consequently,
the Secretary will consider the extent to
which eligible institutions are willing to
conduct the experiment in a way that
maximizes the Department’s ability to
make reliable evaluations of the
experiments.
The Secretary intends to select a
cross-section of Title IV eligible
institutions, carefully considering the
diversity of participating institutions by,
among other characteristics,
institutional type and control,
geographic location, enrollment size,
and Title IV participation levels.
Institutions selected to participate in
the experiments must have a strong
track record in the administration of the
Title IV student assistance programs.
When selecting institutions, the
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Secretary will consider all information
available about an institution including,
but not limited to, evidence of
programmatic compliance, cohort
default rates, financial responsibility
ratios, and, for for-profit institutions,
‘‘90/10’’ results.
Specifically, any institution with a
last official cohort default rate of 25
percent or more (the statutory default
rate threshold for possible loss of Title
IV student loan eligibility) will not be
eligible to participate in the ESI. Nor
will any for-profit institution where 85
percent or more of its revenues come
from Title IV aid (the historical
percentage that applied to for-profit
institutions), as computed under the
requirements for the 90/10 rule. Due to
the proximity of these rates to the
thresholds that would place the
institution in jeopardy of losing Title IV
program eligibility, the Secretary
believes that including institutions with
high cohort default rates or high 90/10
ratios creates a risk to program integrity.
Finally, institutions with recent
cohort default rates and, as appropriate,
90/10 ratios that show a trajectory
toward the 25 percent default rate or the
85 percent Title IV revenue thresholds
will also be ineligible to participate in
the experiments.
In the event that a selected institution
consists of more than one location (e.g.,
campus), the Secretary anticipates
limiting experiments to a single
location, unless the institution proposes
to implement the experiment differently
at other locations to test multiple
alternatives to the statutory or
regulatory requirement, or if the
institution provides the Secretary with
another compelling justification.
Through the ESI, the Department
seeks to partner with institutions in
experiments that will test the
effectiveness of alternatives to selected
statutory or regulatory requirements
applicable to the Title IV, HEA
programs. In general, effectiveness will
be determined by the Department’s
analysis of empirical evidence
submitted by participating institutions.
A successful experiment would be one
that results in improved services to
students or reduces burden on students
and institutions, or both, and supports
the statutory or regulatory intent of the
original requirement and maintains (or
increases) the financial and
programmatic integrity of the Title IV,
HEA programs. Each of the experiments
must provide documented results that
can inform future policy decisions.
For each experiment, we expect to
measure—to the greatest extent
possible—the effect of the alternative
approach on the students whose Title IV
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aid was administered under the
experiment. Evaluations will be
designed to measure the likely outcome
in the absence of the experiment. Thus,
participating institutions will be
required to report information for
students in the experiment and
information, as available, for otherwise
similar students whose Title IV
eligibility was administered under
existing requirements. The specific
reporting requirements will vary among
the experiments and will be finalized in
consultation with the institutions
selected to participate in each
experiment.
In addition to submitting evaluation
data specified for each experiment,
institutions that are selected for
participation in an experiment will be
required to submit a narrative
description of their implementation of
the experiment. The narrative should
include any unforeseen challenges and
unexpected benefits.
Institutions selected for participation
in an experiment will have their
Program Participation Agreement (PPA)
with the Secretary amended to reflect
the specific statutory or regulatory
provisions that the Secretary has waived
or modified. Revised PPAs will also
document the agreement between the
Secretary and the institution about how
each experiment will be conducted and
will specify the evaluation and
reporting requirements for each
experiment.
To assist institutions considering
whether to submit a request to
participate in an experiment, the
Department provides, in the
descriptions of each experiment below,
its initial thoughts on the evaluation
measures and corresponding data that
will be collected from institutions
participating in each experiment.
Institutions that are selected to
participate in an experiment will be
required to submit data and other
information specified by the Secretary
as a condition of the institution’s initial
and continued participation in the
experiment. The Secretary reserves the
right to modify these initial evaluation
measures and reporting requirements for
any experiment to support a rigorous
evaluation of the experiment.
The Experiments:
Experiment 1—Federal Pell Grant
Program—Eligibility of students with
bachelor’s degrees who enroll in
vocational or career programs.
Experiment 2—Federal Pell Grant
Program—Eligibility of students
enrolled in certain short-term training
programs.
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Experiment 3—Direct Loan Program—
Single disbursement of a one-term loan
for study abroad students.
Experiment 4—Direct Loan Program—
Early disbursement for study abroad
students and for students enrolled in
foreign institutions.
Experiment 5—Direct Loan Program—
Unequal disbursements.
Experiment 6—Direct Loan Program—
Limiting unsubsidized loan amounts.
Experiment 7—PLUS Loans for
parents of students with intellectual
disabilities.
Experiment 8—Student Eligibility—
Eligibility of students with intellectual
disabilities who are also enrolled in
high school.
Details on the ESI Experiments:
Experiment 1—Federal Pell Grant
Program—Eligibility of students with
bachelor’s degrees who enroll in
vocational or career programs.
Background: In general, section
401(c)(1) of the HEA provides that
students who have earned a bachelor’s
degree are not eligible for a Federal Pell
Grant. This restriction may prevent lowincome students who have earned a
bachelor’s degree from benefiting from
short-term vocational training when
they are either unemployed or
underemployed, notwithstanding their
having earned a bachelor’s degree. This
experiment would test whether a
limited exception to the provision that
only students without a bachelor’s
degree can receive a Pell Grant would
help address the unemployment or
underemployment status of such
persons.
Description: This experiment would
provide a limited waiver of the statutory
requirement that a student who has
earned a bachelor’s degree may not
receive a Pell Grant. The experiment
would allow at least some students with
a bachelor’s degree to receive not more
than one full scheduled Pell Grant
award, over no more than two award
years, for enrollment in a vocational/
career program of study of one year or
less.
Eligibility would be restricted to
students with a bachelor’s degree who
have demonstrated to the participating
institution that they are unemployed or
underemployed and who will be
entering the vocational program for the
first time.
The experiment will require that the
program be one that provides training
needed to meet local or regional
workforce needs, as determined by the
institution in consultation with
employers or state or local workforce
agencies.
As a condition of receiving a Pell
Grant under this experiment, students
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must agree to provide career and
employment information to the
institution for both the period prior to
enrolling in the program and receiving
Pell Grant funding and for up to two
years following completion or
withdrawal from the program. As an
option, the institution may provide
information it obtains from an
alternative reliable source such as a
state longitudinal data system.
The Department is particularly
interested in applications from
institutions that will include in this
experiment students who are legal
immigrants to the United States, who
were trained as professionals abroad,
and who are seeking credentials
allowing them to fill skilled positions in
the United States.
The objective of the experiment is to
determine if providing Pell Grants to
low-income students who have earned a
bachelor’s degree but who are
unemployed or underemployed
improves the students’ employment
status. The experiment should also
minimize the use of student loan funds
to finance vocational/career education
for such students.
Waivers: Institutions selected for this
experiment will be exempt from the
following statutory and regulatory
provisions:
• HEA section 401(c)(1), which
excludes students who have earned a
bachelor’s degree from receiving Pell
Grant funding.
• 34 CFR 668.32(c)(2)(i)(A), which
excludes baccalaureate or first
professional degree holders from
receiving a Pell Grant.
• 34 CFR 690.6(a), which limits
eligibility for Pell Grants to students
who have not earned their first
bachelor’s degree.
All other provisions of the Student
Assistance General Provisions
regulations and the Federal Pell Grant
regulations will remain in effect,
including 34 CFR 690.6(e), which
provides that a student may not receive
more than nine Pell Grant Scheduled
Awards.
Evaluation: This experiment will be
evaluated by using information
provided by the institution, and any
other information available to the
Secretary, to determine if the students
who received Pell Grant funding under
the experiment completed the program
and became employed in the field for
which the training was provided.
Evaluation measures will include
employment and salary data for the
students before they entered the
program and after completing or
withdrawing from the program. The
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Department will also analyze whether
these students completed their
vocational training with a lower student
loan debt than if they had not received
a Pell Grant.
As noted earlier, to support a
recommendation for a change to a legal
requirement, data from both a treatment
group of students who participated in
the experiment and a control or
comparison group of students who
received their student aid under existing
rules must be evaluated. This could
require that some students who
otherwise meet the eligibility
requirements for this experiment would
have their aid administered under
existing requirements.
The Department will collect and
analyze data to evaluate completion
rates, loan debt, and post-training
employment.
Reporting Requirements: Institutions
participating in this experiment will be
required to report information on the
students participating in the experiment
and on at least the following: (1)
Students enrolled in the program who
do not have a bachelor’s degree and (2)
students with bachelor’s degrees who
were enrolled in the program during one
or more years prior to the first year of
the experiment.
The information that will be reported
for each of the groups of students will
likely include the number of students
who began the program, the amount of
grant and loan assistance received by
the students, the number of students
who withdrew from the program, the
number of students who completed the
program, grade point averages and other
academic performance information for
the students, the number of students
who obtained employment in jobs
related to the vocational training, and
salary information before and after
program completion or withdrawal.
Experiment 2—Federal Pell Grant
Program—Eligibility of students
enrolled in certain short-term training
programs.
Background: In general, section
481(b)(A) of the HEA provides that only
academic programs that are at least 15
weeks in duration and that provide 600
clock hours, 16 semester or trimester
hours, or 24 quarter hours of academic
credit are eligible programs for purposes
of the Federal Pell Grant Program
(unless the program requires at least an
associate’s degree for admission).
Representatives from some state
institutions that offer short-term
vocational programs have suggested that
if the training is directly related to state
or local workforce needs, allowing
shorter term vocational training
programs to be Pell Grant eligible would
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enable unemployed and underemployed
persons to obtain the short-term training
required for employment by local or
regional employers. While some
institutions have developed innovative
programs to embed a short-term
program within a longer eligible degree
or certificate program, such programs
may not meet the needs of all potential
students. This is especially true for
students from low income backgrounds
or those who have work or family
responsibilities that prevent them from
enrolling in longer term programs. In
addition, it is hoped that, under this
experiment, institutions that currently
offer longer term programs may develop
ways that shorten the student’s time to
completion—such as asynchronous
learning, competency based instruction,
or other innovative approaches. Such
changes to the structure of training
programs may allow the program to be
shorter than 15 weeks and still maintain
Pell Grant eligibility.
Description: This experiment would
provide a waiver of the requirement that
a Pell Grant eligible program must
include at least 15 weeks of
instructional time and at least 600 clock
hours, 16 semester or trimester hours, or
24 quarter hours. It would allow Pell
Grants to be received by at least some
otherwise eligible students who are
enrolled in a vocational program of at
least eight weeks in length and that, at
a minimum, includes at least 150 clock
hours of instructional time, which is
what some short-term vocational
programs currently provide. The
amount of the Pell Grant provided to a
student under this experiment will be
prorated for the shorter period of
instructional time, pursuant to the Pell
Grant regulations at 34 CFR 690.63(a)(3).
The experiment will require that the
short-term vocational program at the
community college or postsecondary
vocational institution must provide
training needed to meet local or regional
workforce needs, as determined by the
institution in consultation with
employers or state or local workforce
agencies. As part of that consultation,
the institution must ensure that the
content and instructional hours of the
program are (1) sufficient to meet hiring
requirements of multiple likely
employers, and (2) sufficient to allow
the students to apply for any licenses or
other certifications that may be required
to be employed in the field for which
the training was offered.
As a condition of receiving Pell Grant
funds under this experiment, students
must agree to provide career and
employment information to the
institution for the period prior to
enrolling in the program and for up to
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two years following completion or
withdrawal from the program. As an
option, the institution may provide
information it obtains from an
alternative reliable source such as a
state longitudinal data system.
The objective of this experiment is to
determine if providing Pell Grant
funding to support unemployed or
underemployed persons enrolled in
short-term vocational training programs
offered by community colleges and
postsecondary vocational institutions
increases employment rates or wages of
those persons.
Waivers: Institutions selected for this
experiment will be exempt from the
following statutory and regulatory
provisions:
• HEA section 481(b)(1)(A), which
sets the minimum timeframes for a Pell
Grant eligible program.
• 34 CFR 668.8(d)(1)(i) and (ii), which
establish the timeframes for eligible
programs.
All other provisions of the Student
Assistance General Provisions
regulations and the Federal Pell Grant
regulations will remain in effect.
Evaluation: This experiment will be
evaluated by using information
provided by the institution, and any
other information available to the
Secretary, to determine whether
providing Pell Grant funding for lowincome students enrolled in short-term
vocational programs results in expanded
and improved job placement for those
students. The evaluation will examine
the employment status and, if possible,
the earnings of students participating in
the program and their program
completion rates. It will also measure
employment outcomes of students who
were enrolled in vocational programs
that include at least 15 weeks of
instructional time and at least 600 clock
hours.
As noted earlier, to support a
recommendation for a change to a legal
requirement, data from both a treatment
group of students who participated in
the experiment and a control or
comparison group of students who
received their student aid under existing
rules must be evaluated. The
Department is interested in gathering
data under circumstances that will
allow for a reliable measurement of the
impact of the experiment. Because it is
important that the outcomes for the
treatment group be compared to a group
of students as similar to them as
possible, some students who otherwise
meet the eligibility requirements for this
experiment may need to have their aid
administered under existing
requirements.
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Reporting Requirements: Institutions
participating in this experiment will be
required to report information about the
low-income students enrolled in the
short-term programs who receive Pell
Grants under this experiment and about
non-Pell—eligible students enrolled in
the same (or similar) vocational
program(s), and of students, if any, who
were enrolled in the program prior to
the effective date of this experiment.
The data institutions participating in
this experiment must report will likely
include: Enrollment counts; student
employment and income data, including
participation, if any, in government
assistance programs; amounts of grant
assistance received; program completion
data; information on the placement of
students in applicable jobs, including
the number of different employers
hiring graduates of the program over the
two years following the students’
completion of the program; and salary
information of the students both before
and after program completion or
withdrawal.
Experiment 3—Direct Loan Program—
Single disbursement of a one—term loan
for study abroad students.
Background: Section 428G(a) of the
HEA provides that with two exceptions,
Direct Loan Program loans must be
disbursed at least twice during the loan
period and those disbursements must be
substantially equal. One of the
exceptions allows for a single
disbursement for an institution’s study
abroad students if the institution’s most
recent official Direct Loan/FFEL
Program cohort default rate is less than
five percent. This exception allows
students participating in a study abroad
program sponsored by a domestic
institution to have money to help offset
their initial financial commitments,
such as transportation expenses,
housing costs, visa fees, fees for
immunizations, etc. Additionally, many
countries require, as the United States
requires, that students planning to
attend postsecondary institutions
provide documentation of sufficient
financial resources to cover their
expenses while in the country.
With the nationwide increase in
default rates, many institutions (mostly
public and non-profit four-year
institutions) fall just short of the five
percent cohort default rate threshold
that would allow for a single
disbursement of a one-term Direct Loan
to their study abroad students. With the
upcoming transition to three-year cohort
default rate calculations, it is expected
that even fewer institutions will meet
the less-than-five-percent threshold.
Description: This experiment would
provide a partial waiver to the
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requirement that Direct Loan Program
loans be disbursed in at least two
substantially equal disbursements
during a loan period. It would allow a
single disbursement of a one-term loan
for some study abroad students
attending a participating institution
even if the institution’s cohort default
rate equals or exceeds five percent.
The objective of this experiment is to
determine if providing needed early
loan funding for students studying
outside of the United States increases
participation in foreign educational
experiences for students without
increasing the risk that the students will
not complete the loan period for which
the funds were provided.
Waivers: Institutions selected for this
experiment will be exempt from the
following statutory and regulatory
provisions:
• HEA section 428G(a), which
generally requires multiple
disbursements of student loans.
• 34 CFR 685.301(b)(3)(ii), which
requires at least two disbursements of
Direct Loan Program loan proceeds.
Instead, participating institutions will
be permitted to make one disbursement
of a Direct Loan Program loan for study
abroad students if the loan period is one
academic term. All other provisions of
the Student Assistance General
Provisions regulations and the Direct
Loan Program regulations will remain in
effect.
Evaluation: The Department will
evaluate this experiment by using
information provided by the institution,
and any other information available to
the Secretary, to determine whether the
experiment allowed more students,
especially low-income students, to
participate in study abroad programs. It
will also evaluate whether students
assisted by the experiment completed
the loan period for which they received
Direct Loan funding in a single
disbursement.
As noted earlier, to support a
recommendation for a change to a legal
requirement, data must be provided
from both a treatment group of students
who participated in the experiment and
a control or comparison group of
students who received their student aid
under existing rules. Because it is
important that outcomes for the
treatment group be compared to a group
of students as similar to the treatment
group as possible, some students who
otherwise meet the eligibility
requirements for this experiment may
need to have their aid administered
under existing requirements.
Reporting Requirements: Institutions
participating in this experiment will be
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required to provide information on
study abroad students who received
their loan proceeds in one disbursement
under this experiment as well as for
study abroad students who received
their loan funds for an earlier payment
period when at least two disbursements
were made. The information to be
collected for these groups will likely
include the number of students in each
group, the amount of grant and loan
assistance received, and the number of
students enrolled at the end of the loan
period.
Experiment 4—Direct Loan Program—
Early disbursement for students
participating in approved study abroad
programs and students enrolled in
foreign institutions.
Background: Under the FFEL Program
regulations at 34 CFR 682.207(b)(1)(v), a
student who was participating in an
approved study abroad program or who
was attending an eligible foreign
institution could, upon request of the
institution and the approval of the FFEL
Program guaranty agency, have FFEL
Program loan proceeds disbursed as
early as 30 days prior to the first day of
classes of the academic term (i.e.
payment period). This is an exception to
the Title IV Student Assistance General
Provisions regulations that generally
provide that no Title IV student
assistance funds can be disbursed to a
student earlier than ten days prior to the
first day of classes of the academic term.
This FFEL Program exception was
provided because of the unique
financial needs of students who study
outside of the United States. Such
students typically need their student aid
funds early to meet obligations for travel
to the site of their upcoming studies, to
get established in the foreign country
(housing, etc.), and in some instances to
meet the foreign country’s visa
requirements.
Because prior to July 1, 2010, the only
Title IV student assistance a student
attending an eligible foreign institution
could receive was FFEL Program funds,
there was no need to provide a similar
exception for the Direct Loan Program.
However, with the enactment of the
SAFRA within the Health Care and
Education Reconciliation Act, students
attending foreign institutions (as well as
those participating in approved study
aboard programs sponsored by U.S. host
institutions), must get their Title IV
loans through the Direct Loan Program
which currently has no provision for
early disbursement.
Description: This experiment would
permit participating domestic
institutions to disburse Direct Loan
funds for some students enrolled in
approved study abroad programs as
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early as 30 days prior to the first day of
classes of the student’s enrollment for
the loan period. Similarly, participating
foreign institutions would be able to
disburse Direct Loan funds as early as
30 days prior to the first day of classes
of the student’s enrollment for the loan
period.
As a condition of receiving an early
disbursement of a Direct Loan under
this experiment, students must sign an
agreement with the institution allowing
for the release of the student’s academic
records and agreeing to participate in a
study to determine the impact of the
early disbursement on their foreign
study.
The objective of this experiment is to
determine if providing early
disbursement of Direct Loan proceeds to
students whose academic program
includes studying in a foreign country
increases the number of students who
participate in such programs. It will also
determine if participating students are
academically successful in their
programs because of the financial relief
the early disbursement provides.
Waivers: Institutions selected for this
experiment will be exempt from the
following statutory and regulatory
provisions:
• HEA section 428G, which provides
the earliest date that loan funds may be
disbursed.
• 34 CFR 668.164(f), which provides
that disbursements of Direct Loan
proceeds cannot occur any earlier than
ten days prior to the first day of classes
for the payment period.
All other provisions of the Student
Assistance General Provisions
regulations and the Direct Loan Program
regulations will remain in effect.
Evaluation: This experiment will be
evaluated by using information
provided by the institution, and any
other information available to the
Secretary, to determine if a broader
range of students are able to participate
in foreign study and be successful.
Information collected from students will
attempt to determine the effects of the
early disbursement. Finally, this
experiment will carefully monitor
academic withdrawal rates as well as
loan delinquencies and defaults for
participating students to determine if
there are any abnormalities that might
be attributed to the early disbursement
of loan proceeds.
As noted earlier, to support a
recommendation for a change to a legal
requirement, data must be provided
from both a treatment group of students
who participated in the experiment and
a control or comparison group of
students who received their student aid
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under existing rules. Because it is
important that outcomes for the
treatment group be compared to a group
of students as similar to the treatment
group as possible, some students who
otherwise meet the eligibility
requirements for this experiment may
need to have their aid administered
under existing requirements.
Reporting Requirements: Institutions
participating in this experiment will be
required to report information on the
students participating in the experiment
and also on other students (including
students from prior years) who were
enrolled in study abroad programs or at
foreign institutions, as appropriate. The
data to be collected and analyzed for
each group of students will likely
include the number of students,
confirmation of the students’ actual
attendance at the foreign institution,
and the students’ progress toward
completion of the foreign study
program. Additionally, data will be
collected from the students participating
in the experiment regarding the impact
of the early disbursement on their
foreign study experience. And, for
students who were not participating in
the experiment, data will be collected
on the impact on their foreign study
experience of not receiving their loan
proceeds until, at the earliest, ten days
before the first day of classes for the
academic term.
Experiment 5—Direct Loan Program—
Unequal disbursements.
Background: Section 428G(a)(1) of the
HEA provides that a student’s Direct
Loan must be disbursed in two or more
substantially equal amounts. The dates
of the disbursements usually coincide
with the educational program’s
academic terms (i.e., payment periods)
that make up the loan period. This
provision generally works well since the
costs for most educational programs are
usually reasonably spread out over all of
the payment periods that comprise the
loan period. However, some educational
programs have up-front costs associated
with the first payment period of the loan
period that are substantially higher than
costs for later payment periods. Such
up-front costs could include costs of
required books and supplies that will be
used throughout the loan period,
payment required to meet certain
insurance or medical requirements, and
initial housing costs for students whose
housing changes as a result of enrolling
in the educational program.
Financial aid administrators have
suggested that for some students in
certain academic programs, receiving
only half of their student loan proceeds
at the beginning of the loan period does
not allow the student to meet required
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up-front educational expenses. This can
affect whether the students (particularly
low-income students) are able to enroll
in the program and, once enrolled, be
academically successful.
Description: This experiment would
waive the requirement that Direct Loans
be disbursed in at least two
substantially equal disbursements and
would allow, under certain conditions,
unequal disbursements of Direct Loan
proceeds. Institutions participating in
this experiment will be required to
establish formal policies for determining
the conditions under which it would
allow a student to receive unequal
disbursements of loan funds.
Under this experiment, no student
may receive a single disbursement of
more than 75 percent of the total loan
amount for the loan period, and the
same percentage must be applied to all
of the student’s loans for the loan period
(subsidized, unsubsidized, and PLUS
loans). This provision is to ensure that
there are funds available for later in the
loan period. Any funds released in
excess of the existing rules cannot be
applied to the student’s institutional
tuition and fee charges, except for any
charges directly related to the student
obtaining required books and supplies
or housing provided by the institution.
Institutions must provide guidance to
their Direct Loan borrowers concerning
the types of expenses that may qualify
them for consideration of unequal loan
disbursements and what the acceptable
documentation is for each type of
expense.
The objective of this experiment is to
determine if providing more up-front
loan proceeds when the educational
expenses are higher at the beginning of
the loan period increases the enrollment
and program completion of low-income
students.
This experiment only applies to
Direct Loan proceeds and does not
allow for unequal disbursements of Pell
Grant funds.
Waivers: Institutions selected for this
experiment will be exempt from the
following statutory and regulatory
provisions:
• HEA section 428G(a)(1), which
requires that no Direct Loan
disbursement be for more than one-half
of the total loan for the loan period.
• 34 CFR 685.301(b)(5), which
provides that no installment of a Direct
Loan exceed one-half of the loan for the
loan period.
All other Direct Loan disbursement
requirements will remain in effect.
Evaluation: This experiment will be
evaluated by using information
provided by the institution, and any
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other information available to the
Secretary, to determine whether
allowing unequal disbursement of
Direct Loans increases student
enrollment, increases academic
performance, and leads to the students’
completion of the loan period and
academic program.
As noted earlier, to support a
recommendation for a change to a legal
requirement, data must be provided
from both a treatment group of students
who participated in the experiment and
a control or comparison group of
students who received their student aid
under existing rules. Because it is
important that outcomes for the
treatment group be compared to a group
of students as similar to the treatment
group as possible, some students who
otherwise meet the eligibility
requirements for this experiment may
need to have their aid administered
under existing requirements.
Reporting Requirements: Institutions
participating in this experiment will be
required to report information on the
students participating in the experiment
and also on students enrolled in the
same academic program who received
substantially equal disbursements and
on students who received equal
disbursements for loan periods prior to
the experiment. The measures for these
groups will likely include the number of
students enrolled at the beginning of the
loan period, demographic information
of the students, the amount of grant and
loan assistance awarded to each student,
and completion and other academic
measures for the students. Institutions
must, upon request of the Secretary,
submit a description of their policy for
determining a student’s eligibility for
unequal Direct Loan disbursements.
Experiment 6—Direct Loan Program—
Limiting unsubsidized loan amounts.
Background: Section 479A(c) of the
HEA provides that institutions may only
reduce the amount of a student’s Direct
Loan eligibility on a case-by-case,
documented basis. They may not reduce
eligibility on any across-the-board
programmatic or other categorical basis.
Some in the school community believe
that this prohibition results in excessive
borrowing by some students, especially
by students attending low-cost
institutions or those who live with their
parents (or other family members), or
otherwise do not have significant
housing expenses. The schools also
suggest that providing the statutorily
established loan amounts (especially
after recent statutory increases) to all
students provides incentives for persons
to enroll in low cost institutions only to
receive a cash disbursement of Federal
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grant and loan funds in excess of direct
institutional charges.
Institutions also argue that the
requirement that they provide the full
loan amount to all students negatively
affects the institution’s cohort default
rates, thereby placing in jeopardy not
only the availability of the Direct Loan
Program but also the Pell Grant Program
for all of the institution’s students.
Consequently, some low-cost
institutions, mostly community
colleges, have chosen not to participate
in the loan programs at all, thus
depriving otherwise eligible students of
access to low-cost Federal student loan
assistance.
Some for-profit institutions argue that
because of the requirement that no more
than 90 percent of their revenues can
come from Title IV student aid—the 90/
10 rule—they must ensure that their
tuition always exceeds their students’
Title IV eligibility. Thus, they cannot
reduce tuition and, as Title IV aid
amounts increase (e.g., increases in the
maximum annual loan amounts), they
often must raise tuition.
Description: This experiment would
allow an institution to establish a
written policy where it would, for
students enrolled in a particular
educational program or on some other
categorical basis (e.g., students living at
home or first-time freshman), reduce by
at least $2,000 (the amount of the most
recent statutory increase) the amount of
an unsubsidized Direct Loan that the
otherwise eligible student would
receive, or eliminate the unsubsidized
Direct Loan completely.
The institution must continue to
ensure that each eligible student
receives the full amount of any
subsidized Direct Loan the student has
requested, up to the statutory
maximums for subsidized loans.
Although this experiment will allow
reductions in Direct Loan amounts on
other than a case-by-case basis, it would
not allow institutions to discriminate
against any borrower or applicant on the
basis of race, national origin, religion,
sex, marital status, age, or disability
status.
The Department anticipates that
experiments in this area would address
at least one of three issues and requests
that institutions wishing to be
considered for this experiment clearly
state which of the three following issues
they wish to test.
(1) Over-borrowing. The one-size-fitsall nature of annual loan limits may give
some students access to more in Federal
loans than they need to complete their
educational program. Some students
may borrow more than is justified by the
economic prospects for completers of
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their educational program (i.e., major
course of study or vocational area of
concentration). Despite recent increases
in loan limits, there is little empirical
evidence of the effect additional loan
amounts have on student access and
completion. Experiments designed to
address over-borrowing would reduce
students’ annual unsubsidized loan
limits by at least $2,000, restoring those
limits to no higher than their 2007–2008
level.
For-profit colleges interested in
reducing their students’ over-borrowing
are encouraged to apply to participate in
this experiment under both this issue
and under issue 3, Unintended
consequences at for-profit colleges.
(2) Lack of loan availability.
Paradoxically, the same limits that may
lead some students to borrow too much
may prevent others from borrowing at
all. Some institutions, particularly
community colleges, have chosen not to
participate in the Federal student loan
programs, in part because they are
concerned that high cohort default rates
could jeopardize the Pell Grant
eligibility of their students. As a result,
some students attending those
institutions must work longer hours or
must use private student loans and
credit cards to help finance their
education. Institutions that wish to be
considered for this experiment because
they had previously chosen not to
participate in the loan programs, would,
as a condition of the experiment,
become participating Direct Loan
institutions and begin to make Direct
Loans available to their students under
the terms of this experiment.
(3) Unintended consequences at forprofit colleges. Some for-profit
institutions argue that due to the 90/10
rule, they must set tuition charges above
their students’ Title IV aid eligibility. As
a result, these institutions argue,
increases in annual loan limits has the
perverse consequence of not allowing
them to reduce tuition and, in some
instances, actually requires them to
raise tuition. Additionally, some of
these institutions claim that because of
the 90/10 rule, they admit fewer
financially needy students who bring
with them increased amounts of Title IV
aid eligibility. Allowing reduced loan
limits for some for-profit institutions
under this experiment will test these
claims and, if they are true, could result
in some institutions lowering tuitions.
For-profit institutions wishing to
participate in this experiment for
purposes of addressing tuition levels
would be required to include along with
reductions in students’ annual
unsubsidized loan eligibility of at least
$2,000, reductions in tuition of the same
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amount. Requests to participate under
this issue should address how reducing
loan limits may affect long term
decisions on tuition or other fees.
The Department is aware of the risks
of reduced access to loans for some
students. Participating institutions will
be required to describe how they will
ensure that their educational programs
remain affordable for students in all
financial circumstances and that the
institution has maintained the economic
and ethnic diversity of its students and
graduates. In addition, participating
institutions will be expected to describe
how they will attempt to prevent
increases in other forms of debt by
students whose unsubsidized loan
amounts were reduced, including
increased use of private student loans
and credit cards. Participants will be
required to report data on these
commitments, and experiments that are
not meeting them will be terminated.
Institutions participating in this
experiment must inform their students
and prospective students that the
institution is participating in the
experiment and that the institution has
established maximum loan limits for
unsubsidized loans that are less than the
statutory maximums.
Waivers: Institutions selected for this
experiment will be exempt from the
following statutory and regulatory
provisions:
• HEA section 479A(c), which allows
only case-by-case reductions in Direct
Loan amounts.
• 34 CFR 685.301(a)(8), which
provides that reductions in a student’s
eligibility for a Direct Loan can only be
made on a case-by-case basis.
All other Direct Loan requirements will
be in effect.
Evaluation: This experiment will be
evaluated by using information
provided by the institution, and any
other information available to the
Secretary, to determine whether
students who received less than the
statutory amounts of Direct Loans were
able to enroll in, succeed, and complete
their academic programs. The Secretary
will compare those results with results
from similar students who received the
higher loan amounts. An analysis of the
effect of the experiment on the diversity
of the students enrolled in the
institution will be conducted, especially
as it relates to the numbers of lowincome students. The evaluation will
also attempt to determine if the lower
educational loan debt of the students in
the experiment resulted in fewer
delinquencies and defaults.
As noted earlier, to support a
recommendation for a change to a legal
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requirement, data must be provided
from both a treatment group of students
who participated in the experiment and
a control or comparison group of
students who received their student aid
under existing rules. Because it is
important that outcomes for the
treatment group be compared to a group
of students as similar to the treatment
group as possible, some students who
otherwise meet the eligibility
requirements for this experiment may
need to have their aid administered
under existing requirements.
The Department will also evaluate
this experiment by analyzing the
information reported by the
participating institutions to determine
compliance with the experimental
requirements that students do not
receive increased amounts of nonFederal financing and to determine that
participating for-profit institutions were
able to reduce tuition and fees during
the term of the experiment by an
amount equal to the amount that
student loan borrowing was reduced.
Reporting Requirements: The
Secretary will require institutions
participating in this experiment to
report information on the students
affected by the experiment and also on
students enrolled in the same or in a
similar program when the experiment
was not in effect. The measures for these
groups will likely include the number of
enrolled students and their
demographic information; tuition
charges; the amount of grant and loan
assistance awarded to each student;
grades (or other measures of academic
performance); the number of students
enrolled at the beginning of the loan
period; the number of withdrawals; the
number of completions; and average
student debt levels, including nonFederal debts.
Institutions must, upon the request of
the Secretary, submit a description of
their policy and procedures for
determining the amount of the reduced
loan eligibility.
Experiment 7—Direct Loan Program—
PLUS Loans for parents of students with
intellectual disabilities.
Background: Pursuant to section
484(s) of the HEA, students with
intellectual disabilities who are enrolled
in an approved comprehensive
transition and postsecondary program
(transition program) are eligible to
receive funding from the Pell, Federal
Work Study (FWS), and Federal
Supplemental Educational Opportunity
Grant (FSEOG) programs,
notwithstanding that the students are
not enrolled in an academic program
that leads to a postsecondary
educational credential. This statutory
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provision specifically provides that
such students may not receive support
from the Title IV loan programs.
Because of this, an otherwise eligible
parent is unable to receive a Direct
PLUS loan to help offset the educational
costs for their intellectually disabled
son or daughter to enroll in an approved
transition program. This places the
family in a difficult financial situation
when educational costs exceed,
sometimes significantly, the limited
other Title IV aid that may be available.
This is, of course, particularly true for
the parents of students who are not Pell
or FSEOG eligible, arguably the target
group for parent PLUS loans. Many of
these parents may be forced to rely on
less favorable private financing to
support their child’s education.
Description: This experiment would
permit participating institutions to
originate and disburse Direct PLUS
loans to the otherwise eligible parents of
dependent students with intellectual
disabilities, as defined in the
Department’s regulations at 34 CFR
668.231(b), who are enrolled in an
approved comprehensive transition and
postsecondary program (transition
program), as defined in the
Department’s regulations at 34 CFR
668.231(a). As a condition of the parent
receiving a Direct PLUS loan under this
experiment, the student, or the student’s
parent(s) if required, must sign an
agreement with the institution allowing
for the release to the Department of the
student’s academic and other records
related to the student’s participation in
the transition program. The release must
also provide that the student (or parent)
will provide information on the
student’s post enrollment living and
occupational status. Additionally, the
parents must agree to provide the
institution, for release to the Secretary,
general information concerning how the
family financed the student’s attendance
in the transition program.
The objective of this experiment is to
determine if by providing this financing
option to some parents, more students
with intellectual disabilities will enroll
in and complete an approved transition
program. Another objective is to reduce
the parents’ debt burden caused by
higher interest rates from non-Federal
financing.
Waivers: Institutions selected for this
experiment will be exempt from the
following statutory and regulatory
provisions:
• The portion of HEA section 484(s)
that provides that students with
intellectual disabilities who are enrolled
in an approved comprehensive
transition and postsecondary program
may only receive Title IV funding from
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the Pell Grant, FSEOG, and FWS
programs.
• 34 CFR 668.230, which states that
the only programs a student with
intellectual disabilities who is enrolled
in a comprehensive transition and
postsecondary program is eligible for are
the Pell Grant, FSEOG, and FWS
programs.
All other Student Assistance General
Provisions regulations and Direct Loan
regulations, including all of the Direct
PLUS Loan requirements of 34 CFR Part
685, will remain in effect.
Evaluation: This experiment will be
evaluated by using information
provided by the institution, and any
other information available to the
Secretary, to determine if making Direct
PLUS loans available to the parents of
students with intellectual disabilities
who are enrolled in a transition
program, increases the participation of
those students and increases the
likelihood of the students completing
the transition program. The experiment
will also test to see if the availability of
PLUS loans reduces the reliance by the
parents on non-Federal loans and other
less favorable financing.
As noted earlier, to support a
recommendation for a change to a legal
requirement, data must be provided
from both a treatment group and a
control or comparison group. Because it
is important that outcomes for the
treatment group be compared to a group
as similar to the treatment group as
possible, some students who otherwise
meet the eligibility requirements for this
experiment may need to have their aid
administered under existing
requirements.
Reporting Requirements: Institutions
participating in this experiment will be
required to report information on the
students and parents who benefit from
the PLUS loan and on those who did
not. The data to be collected and
analyzed will likely include the number
of students enrolled in the transition
program; the types and amounts of Title
IV aid received by the students and, if
applicable, by the parents; and
information on the students’ enrollment
in, and completion of, the transition
program. Additional data will be
collected from parents regarding the
need for other educational financing.
Experiment 8—Student Eligibility—
Eligibility of students with intellectual
disabilities who are also enrolled in
high school.
Background: Pursuant to section
484(s) of the HEA, students with
intellectual disabilities who are enrolled
in an approved comprehensive
transition and postsecondary program
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(transition program) are eligible to
receive funding from the Pell, Federal
Work Study (FWS), and Federal
Supplemental Educational Opportunity
Grant (FSEOG) programs,
notwithstanding that the students are
not enrolled in an academic program
that leads to a postsecondary
educational credential. Section 484(a)(1)
of the HEA specifically prohibits any
student from receiving Title IV
assistance if the student is also enrolled
in a secondary school (i.e., high school)
and no statutory exception was
provided for students enrolled in
transition programs. Since the purpose
of these comprehensive transition and
postsecondary programs is to provide
transition training to students who have
intellectual disabilities, many of these
students would benefit significantly
from enrolling in the transition program
at the postsecondary institution while
still completing their high school
curriculum. For many of these students
enrolling in the postsecondary
transition program while still in high
school offers them the best chance for
academic, vocational, and life success.
Description: This experiment would
permit some students with intellectual
disabilities who are enrolled in an
approved comprehensive transition and
postsecondary program at a Title IV
eligible institution while also enrolled
in secondary school—dually enrolled
students—to receive Title IV funding,
notwithstanding the general prohibition
of eligibility for such students because
of their dual enrollment. Institutions
participating in this experiment will be
required to obtain assurances from other
entities that provide education services
or financial support to students
participating in the experiment,
including local education agencies
(LEAs) and State Vocational
Rehabilitation Agencies, that those
entities will maintain their support for
the students receiving Federal financial
aid under this experiment or to the
students’ families, unless the entity is
legally prohibited from doing so.
The objective of this experiment is to
determine if, by providing Title IV aid
to otherwise eligible students with
intellectual disabilities who are enrolled
in an approved transition program while
also enrolled in high school, the
transition process for the students can
be improved without placing financial
burdens on their families.
Waivers: Institutions selected for this
experiment will be exempt from the
following statutory and regulatory
provisions, but only for students with
intellectual disabilities who are enrolled
in approved transition programs:
PO 00000
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Fmt 4703
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• The provision of HEA section
484(a)(1) that precludes students who
are enrolled in secondary school from
receiving Title IV aid.
• 34 CFR 668.32(b), which excludes
elementary or secondary school
students from eligibility for Title IV
assistance.
All other student eligibility
requirements would remain in effect as
would the specific requirements of each
of the Title IV student assistance
programs.
Evaluation: This experiment will be
evaluated by using information
provided by the institution, and any
other information available to the
Secretary, to determine if more
intellectually disabled students enroll in
and complete a comprehensive
transition and postsecondary program
than would have without the
experiment. The evaluation will assess
the success of dually enrolled students
in the transition program relative to
their peers who were not also enrolled
in high school.
As noted earlier, to support a
recommendation for a change to a legal
requirement, data must be provided
from both a treatment group of students
who participated in the experiment and
a control or comparison group of
students who received their student aid
under existing rules. Because it is
important that outcomes for the
treatment group be compared to a group
of students as similar to the treatment
group as possible, some students who
otherwise meet the eligibility
requirements for this experiment may
need to have their aid administered
under existing requirements.
Reporting Requirements: Institutions
participating in this experiment will be
required to report information on the
students participating in the experiment
and also on students enrolled in the
transition program who were not also
enrolled in high school. The data to be
collected and analyzed for each group of
students will likely include the number
of students; the types and amounts of
Title IV and other student aid received;
the students’ progress toward
completion of the high school
curriculum and progress toward
completion of the transition program
curriculum; and, where appropriate,
employment information of the students
who complete the transition program.
As a condition of the student
receiving Title IV aid while enrolled in
high school under this experiment, the
student, or the student’s parent(s), if
required, must sign an agreement with
the institution allowing for the release
to the Department of the student’s
academic and other records related to
E:\FR\FM\27OCN1.SGM
27OCN1
Federal Register / Vol. 76, No. 208 / Thursday, October 27, 2011 / Notices
the student’s participation in the
transition program. The release must
also provide that the student (or parent)
will provide information on the
student’s post enrollment living and
occupational status.
Institutions participating in this
experiment will be required to provide
information on whether other
educational service providers
maintained the students’ programmatic
and financial support while the student
was still enrolled in high school.
Accessible Formats: Individuals with
disabilities can obtain this document in
an accessible format (e.g. braille, large
print, audiotape, or compact disc) on
request to the contact person listed
under FOR FURTHER INFORMATION
CONTACT.
Electronic Access to This Document:
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 via the Federal Digital System
at: https://www.gpo.gov/fdsys. At this
site you can view this document, as well
as all other documents of this
Department published in the Federal
Register, in text or Adobe Portable
Document Format (PDF). To use PDF,
you must have Adobe Acrobat Reader,
which is available free at the site.
You may also access documents of the
Department published in the Federal
Register by using the article search
feature at: https://
www.federalregister.gov. Specifically,
through the advanced search feature at
this site, you can limit your search to
documents published by the
Department.
Program Authority: Section 487A(b); 20
U.S.C. 1094a(b).
Dated: October 21, 2011.
Eduardo M. Ochoa,
Assistant Secretary for Postsecondary
Education.
[FR Doc. 2011–27880 Filed 10–26–11; 8:45 am]
BILLING CODE 4000–01–P
DEPARTMENT OF ENERGY
Federal Energy Regulatory
Commission
wreier-aviles on DSK7SPTVN1PROD with NOTICES
[Docket Nos. IC11–1–000 and IC11–1F–000]
Commission Information Collection
Activities (FERC–1 and FERC–1F);
Comment Request; Submitted for OMB
Review
Federal Energy Regulatory
Commission.
ACTION: Notice.
AGENCY:
VerDate Mar<15>2010
14:47 Oct 26, 2011
Jkt 226001
In compliance with the
requirements of section 3507 of the
Paperwork Reduction Act of 1995, 44
U.S.C. 3507, the Federal Energy
Regulatory Commission (Commission or
FERC) is submitting the information
collections described below to the
Office of Management and Budget
(OMB) for review of the information
collections requirements. Any interested
person may file comments directly with
OMB and should address a copy of
those comments to the Commission as
explained below. The Commission
issued a Notice in the Federal Register
(76 FR 46781, 10/3/2011) requesting
public comments. FERC received one
comment on the FERC–1 and the FERC–
1F and has provided a response in this
notice as well as in its submission to
OMB.
DATES: Comments on the collection of
information are due by November 28,
2011.
ADDRESSES: Address comments on the
collection of information to the Office of
Management and Budget, Office of
Information and Regulatory Affairs,
Attention: Federal Energy Regulatory
Commission Desk Officer. Comments to
Created by OMB should be filed
electronically, c/o
oira__submission@omb.eop.gov and
include OMB Control Numbers 1902–
0021 (for FERC–1) and 1902–0029 (for
FERC–1F) as a point of reference. For
comments that pertain to only one of the
collections, specify the appropriate
collection and OMB Control Number.
The Desk Officer may be reached by
telephone at (202) 395–4718.
A copy of the comments should also
be sent to: Federal Energy Regulatory
Commission, Secretary of the
Commission, 888 First Street, NE.,
Washington, DC 20426. Comments may
be filed either on paper or on CD/DVD,
and should refer to Docket Nos. IC11–
1–001 and IC11–1F as appropriate.
Documents must be prepared in an
acceptable filing format and in
compliance with Commission
submission guidelines at https://
www.ferc.gov/help/submissionguide.asp. eFiling and eSubscription are
not available for Docket No. IC11–1F–
001, due to a system issue, but are
available for Docket No. IC11–1–001.
All comments may be viewed, printed
or downloaded remotely via the Internet
through FERC’s homepage using the
‘‘eLibrary’’ link. For user assistance,
contact ferconlinesupport@ferc.gov or
toll-free at (866) 208–3676, or for TTY,
contact (202) 502–8659.
FOR FURTHER INFORMATION CONTACT:
Ellen Brown may be reached by email
at DataClearance@FERC.gov, by
SUMMARY:
PO 00000
Frm 00026
Fmt 4703
Sfmt 4703
66707
telephone at (202) 502–8663, and by fax
at (202) 273–0873.
SUPPLEMENTARY INFORMATION: In
accordance with sections 304 and 309 of
the Federal Power Act, FERC is
authorized to collect and record data to
the extent it considers necessary, and to
prescribe rules and regulations
concerning accounts, records and
memoranda. The Commission may
prescribe a system of accounts for
jurisdictional companies and after
notice and an opportunity for hearing
may determine the accounts in which
particular outlays and receipts will be
entered, charged or credited.
The Form No. 1 is a comprehensive
financial and operating report submitted
for electric rate regulation and financial
audits. Major is defined as having (1)
one million Megawatt hours or more; (2)
100 megawatt hours of annual sales for
resale; (3) 500 megawatt hours of annual
power exchange delivered; or (4) 500
megawatt hours of annual wheeling for
others (deliveries plus losses).
FERC Form 1–F is designed to collect
financial and operational information
from non-major public utilities and
licensees. Non-major is defined as
having total annual sales of 10,000
megawatt-hours or more in the previous
calendar year and not classified as
Major. The Commission collects Form
Nos. 1 and 1–F information as
prescribed in 18 CFR 141.1 and 141.2.
Under the existing regulations FERC
jurisdictional entities subject to its
Uniform System of Accounts 1 must
annually (quarterly for the 3Q) file with
the Commission a complete set of
financial statements, along with other
selected financial and non financial data
through the submission of FERC Forms
1, 1–F, and 3Q.2 The FERC Annual/
Quarterly Report Forms provide the
Commission, as well as others, with an
informative picture of the jurisdictional
entities financial condition along with
other relevant data that is used by the
Commission, as well as others, in
making economic judgments about the
entity or its industry.
The information collected in the
forms is used by Commission staff, state
regulatory agencies and others in the
review of the financial condition of
regulated companies. The information is
also used in various rate proceedings,
industry analyses and in the
Commission’s audit programs and as
appropriate, for the computation of
1 See
18 CFR part 201.
FERC Form 3Q data collection (OMB
Control No. 205) is not being renewed as part of this
proceeding. Some information regarding the Form
3Q is included here as it relates to the FERC Forms
1 and 1F.
2 The
E:\FR\FM\27OCN1.SGM
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Agencies
[Federal Register Volume 76, Number 208 (Thursday, October 27, 2011)]
[Notices]
[Pages 66698-66707]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-27880]
=======================================================================
-----------------------------------------------------------------------
DEPARTMENT OF EDUCATION
Postsecondary Educational Institutions Invited To Participate in
Experiments Under the Experimental Sites Initiative
AGENCY: Office of Postsecondary Education, Department of Education.
ACTION: Notice.
-----------------------------------------------------------------------
Overview Information: Federal Student Financial Assistance Programs
under Title IV of the Higher Education Act of 1965, as amended; notice
inviting postsecondary educational institutions to participate in
experiments under the Experimental Sites Initiative.
SUMMARY: The Secretary invites postsecondary educational institutions
(institutions) that participate in the student assistance programs
authorized under Title IV of the Higher Education Act of 1965, as
amended (the HEA), to apply to participate in one or more new
experiments under the Experimental Sites Initiative (ESI), as
authorized by section 487A(b) of the HEA. Under section 487A(b) the
Secretary has the authority to grant waivers from specific Title IV,
HEA statutory or regulatory requirements to allow institutions to test
alternative methods for administering the Title IV, HEA programs.
DATES: Applications to participate in any experiment must be received
by the Department no later than December 12, 2011 in order for an
institution to receive priority to be considered for participation in
an experiment. Letters of application received after December 12, 2011
may be considered for participation at a later time.
ADDRESSES: Letters of application must be submitted via electronic mail
to the following email address: experimentalsites@ed.gov. For formats
and other required information, see ``Instructions for Submitting
Letters of Application'' under SUPPLEMENTARY INFORMATION, below.
FOR FURTHER INFORMATION CONTACT: Warren Farr, U.S. Department of
Education, Federal Student Aid, 830 First Street, NE., Washington, DC
20002. Telephone: (202) 377-4380 or by email at: Warren.Farr@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.
[[Page 66699]]
SUPPLEMENTARY INFORMATION:
Instructions for Submitting Letters of Application:
Letters of application should take the form of a .PDF attachment to
an email message sent to the email address provided in the ADDRESSES
section of this notice. The subject line of the email should read
``ESI--Request to Participate.'' The text of the email should identify
the experiment, or experiments, the institution wishes to participate
in by number and title used in the ``The Experiments'' paragraph under
SUPPLEMENTARY INFORMATION, below (e.g., ``Experiment 5--Direct Loan
Program--Unequal disbursements'').
The letter of application should be on institutional letterhead and
be signed by an official of the institution. The letter must include
the institution's official name and Department of Education Office of
Postsecondary Education Identification (OPEID), as well as a mailing
address, email address, FAX number, and telephone number of a contact
person at the institution.
Background:
This notice is the second notice regarding the Experimental Sites
Initiative (ESI). The first, published in the Federal Register on
October 28, 2009 (74 FR 55542), solicited suggestions from institutions
for new experiments under the ESI. The Department received suggestions
for new experiments from institutions representing all sectors of the
postsecondary education community. This notice invites institutions to
request to participate in one or more of the experiments described in
this notice.
Under the waiver authority granted the Secretary under section
487A(b) of the HEA, each experiment will be designed to test whether
proposed changes to current requirements improve the administration of
the Title IV programs. Substantiated improvements as a result of an
experiment would provide a rationale for policymakers to consider
changing the statutory or regulatory provision that was the focus of
the experiment.
The Department is interested in gathering data under circumstances
that will allow for a reliable evaluation of the experiments.
Participating institutions will be expected to gather and report data
needed by the Department for this purpose. To support recommendations
for change, evidence must be provided that was obtained from both a
treatment group of students who participated in the experiment and a
control or comparison group of students who received their student aid
under existing rules. As for any evaluation design, it is important
that the control or comparison group be as similar as possible to the
treatment group.
Depending upon the experiment, the control group could be a set of
students who otherwise meet the eligibility requirements for the
experiment but are randomly selected to have their aid administered
under existing requirements. Comparison groups could include students
from, for example, a different but similar educational program, a
different but similar location or campus, an earlier award year, or a
group that does not have the same need for the treatment (e.g., they
are not Pell Grant eligible); but in all cases these groups should be
made up of students as similar as possible to those in the treatment
group.
The Secretary intends to support experiments where the Department
can draw causal inferences about the effects of the alternative
approach based on a rigorous evaluation design. Examples of the kinds
of evaluation and research designs that allow conclusions to be drawn
about the effects of an intervention (program, policy, or practice) can
be found at ED's What Works Clearinghouse (https://ies.ed.gov/ncee/wwc/
).
Institutions may apply to participate in one or more of the eight
experiments included in this notice and described below. From the
institutions that apply, the Secretary will select only a limited
number to participate in each experiment. The selection of
participating institutions will be guided by the purpose of the ESI,
which is, as is provided for under section 487A(b), to evaluate
alternatives to current requirements, and inform policymakers about the
possibility of changes to those requirements. The ESI is not designed
to provide broad regulatory relief or general exceptions to the
statutory and regulatory requirements. Consequently, the Secretary will
consider the extent to which eligible institutions are willing to
conduct the experiment in a way that maximizes the Department's ability
to make reliable evaluations of the experiments.
The Secretary intends to select a cross-section of Title IV
eligible institutions, carefully considering the diversity of
participating institutions by, among other characteristics,
institutional type and control, geographic location, enrollment size,
and Title IV participation levels.
Institutions selected to participate in the experiments must have a
strong track record in the administration of the Title IV student
assistance programs. When selecting institutions, the Secretary will
consider all information available about an institution including, but
not limited to, evidence of programmatic compliance, cohort default
rates, financial responsibility ratios, and, for for-profit
institutions, ``90/10'' results.
Specifically, any institution with a last official cohort default
rate of 25 percent or more (the statutory default rate threshold for
possible loss of Title IV student loan eligibility) will not be
eligible to participate in the ESI. Nor will any for-profit institution
where 85 percent or more of its revenues come from Title IV aid (the
historical percentage that applied to for-profit institutions), as
computed under the requirements for the 90/10 rule. Due to the
proximity of these rates to the thresholds that would place the
institution in jeopardy of losing Title IV program eligibility, the
Secretary believes that including institutions with high cohort default
rates or high 90/10 ratios creates a risk to program integrity.
Finally, institutions with recent cohort default rates and, as
appropriate, 90/10 ratios that show a trajectory toward the 25 percent
default rate or the 85 percent Title IV revenue thresholds will also be
ineligible to participate in the experiments.
In the event that a selected institution consists of more than one
location (e.g., campus), the Secretary anticipates limiting experiments
to a single location, unless the institution proposes to implement the
experiment differently at other locations to test multiple alternatives
to the statutory or regulatory requirement, or if the institution
provides the Secretary with another compelling justification.
Through the ESI, the Department seeks to partner with institutions
in experiments that will test the effectiveness of alternatives to
selected statutory or regulatory requirements applicable to the Title
IV, HEA programs. In general, effectiveness will be determined by the
Department's analysis of empirical evidence submitted by participating
institutions. A successful experiment would be one that results in
improved services to students or reduces burden on students and
institutions, or both, and supports the statutory or regulatory intent
of the original requirement and maintains (or increases) the financial
and programmatic integrity of the Title IV, HEA programs. Each of the
experiments must provide documented results that can inform future
policy decisions.
For each experiment, we expect to measure--to the greatest extent
possible--the effect of the alternative approach on the students whose
Title IV
[[Page 66700]]
aid was administered under the experiment. Evaluations will be designed
to measure the likely outcome in the absence of the experiment. Thus,
participating institutions will be required to report information for
students in the experiment and information, as available, for otherwise
similar students whose Title IV eligibility was administered under
existing requirements. The specific reporting requirements will vary
among the experiments and will be finalized in consultation with the
institutions selected to participate in each experiment.
In addition to submitting evaluation data specified for each
experiment, institutions that are selected for participation in an
experiment will be required to submit a narrative description of their
implementation of the experiment. The narrative should include any
unforeseen challenges and unexpected benefits.
Institutions selected for participation in an experiment will have
their Program Participation Agreement (PPA) with the Secretary amended
to reflect the specific statutory or regulatory provisions that the
Secretary has waived or modified. Revised PPAs will also document the
agreement between the Secretary and the institution about how each
experiment will be conducted and will specify the evaluation and
reporting requirements for each experiment.
To assist institutions considering whether to submit a request to
participate in an experiment, the Department provides, in the
descriptions of each experiment below, its initial thoughts on the
evaluation measures and corresponding data that will be collected from
institutions participating in each experiment. Institutions that are
selected to participate in an experiment will be required to submit
data and other information specified by the Secretary as a condition of
the institution's initial and continued participation in the
experiment. The Secretary reserves the right to modify these initial
evaluation measures and reporting requirements for any experiment to
support a rigorous evaluation of the experiment.
The Experiments:
Experiment 1--Federal Pell Grant Program--Eligibility of students
with bachelor's degrees who enroll in vocational or career programs.
Experiment 2--Federal Pell Grant Program--Eligibility of students
enrolled in certain short-term training programs.
Experiment 3--Direct Loan Program--Single disbursement of a one-
term loan for study abroad students.
Experiment 4--Direct Loan Program--Early disbursement for study
abroad students and for students enrolled in foreign institutions.
Experiment 5--Direct Loan Program--Unequal disbursements.
Experiment 6--Direct Loan Program--Limiting unsubsidized loan
amounts.
Experiment 7--PLUS Loans for parents of students with intellectual
disabilities.
Experiment 8--Student Eligibility--Eligibility of students with
intellectual disabilities who are also enrolled in high school.
Details on the ESI Experiments:
Experiment 1--Federal Pell Grant Program--Eligibility of students
with bachelor's degrees who enroll in vocational or career programs.
Background: In general, section 401(c)(1) of the HEA provides that
students who have earned a bachelor's degree are not eligible for a
Federal Pell Grant. This restriction may prevent low-income students
who have earned a bachelor's degree from benefiting from short-term
vocational training when they are either unemployed or underemployed,
notwithstanding their having earned a bachelor's degree. This
experiment would test whether a limited exception to the provision that
only students without a bachelor's degree can receive a Pell Grant
would help address the unemployment or underemployment status of such
persons.
Description: This experiment would provide a limited waiver of the
statutory requirement that a student who has earned a bachelor's degree
may not receive a Pell Grant. The experiment would allow at least some
students with a bachelor's degree to receive not more than one full
scheduled Pell Grant award, over no more than two award years, for
enrollment in a vocational/career program of study of one year or less.
Eligibility would be restricted to students with a bachelor's
degree who have demonstrated to the participating institution that they
are unemployed or underemployed and who will be entering the vocational
program for the first time.
The experiment will require that the program be one that provides
training needed to meet local or regional workforce needs, as
determined by the institution in consultation with employers or state
or local workforce agencies.
As a condition of receiving a Pell Grant under this experiment,
students must agree to provide career and employment information to the
institution for both the period prior to enrolling in the program and
receiving Pell Grant funding and for up to two years following
completion or withdrawal from the program. As an option, the
institution may provide information it obtains from an alternative
reliable source such as a state longitudinal data system.
The Department is particularly interested in applications from
institutions that will include in this experiment students who are
legal immigrants to the United States, who were trained as
professionals abroad, and who are seeking credentials allowing them to
fill skilled positions in the United States.
The objective of the experiment is to determine if providing Pell
Grants to low-income students who have earned a bachelor's degree but
who are unemployed or underemployed improves the students' employment
status. The experiment should also minimize the use of student loan
funds to finance vocational/career education for such students.
Waivers: Institutions selected for this experiment will be exempt
from the following statutory and regulatory provisions:
HEA section 401(c)(1), which excludes students who have
earned a bachelor's degree from receiving Pell Grant funding.
34 CFR 668.32(c)(2)(i)(A), which excludes baccalaureate or
first professional degree holders from receiving a Pell Grant.
34 CFR 690.6(a), which limits eligibility for Pell Grants
to students who have not earned their first bachelor's degree.
All other provisions of the Student Assistance General Provisions
regulations and the Federal Pell Grant regulations will remain in
effect, including 34 CFR 690.6(e), which provides that a student may
not receive more than nine Pell Grant Scheduled Awards.
Evaluation: This experiment will be evaluated by using information
provided by the institution, and any other information available to the
Secretary, to determine if the students who received Pell Grant funding
under the experiment completed the program and became employed in the
field for which the training was provided. Evaluation measures will
include employment and salary data for the students before they entered
the program and after completing or withdrawing from the program. The
[[Page 66701]]
Department will also analyze whether these students completed their
vocational training with a lower student loan debt than if they had not
received a Pell Grant.
As noted earlier, to support a recommendation for a change to a
legal requirement, data from both a treatment group of students who
participated in the experiment and a control or comparison group of
students who received their student aid under existing rules must be
evaluated. This could require that some students who otherwise meet the
eligibility requirements for this experiment would have their aid
administered under existing requirements.
The Department will collect and analyze data to evaluate completion
rates, loan debt, and post-training employment.
Reporting Requirements: Institutions participating in this
experiment will be required to report information on the students
participating in the experiment and on at least the following: (1)
Students enrolled in the program who do not have a bachelor's degree
and (2) students with bachelor's degrees who were enrolled in the
program during one or more years prior to the first year of the
experiment.
The information that will be reported for each of the groups of
students will likely include the number of students who began the
program, the amount of grant and loan assistance received by the
students, the number of students who withdrew from the program, the
number of students who completed the program, grade point averages and
other academic performance information for the students, the number of
students who obtained employment in jobs related to the vocational
training, and salary information before and after program completion or
withdrawal.
Experiment 2--Federal Pell Grant Program--Eligibility of students
enrolled in certain short-term training programs.
Background: In general, section 481(b)(A) of the HEA provides that
only academic programs that are at least 15 weeks in duration and that
provide 600 clock hours, 16 semester or trimester hours, or 24 quarter
hours of academic credit are eligible programs for purposes of the
Federal Pell Grant Program (unless the program requires at least an
associate's degree for admission).
Representatives from some state institutions that offer short-term
vocational programs have suggested that if the training is directly
related to state or local workforce needs, allowing shorter term
vocational training programs to be Pell Grant eligible would enable
unemployed and underemployed persons to obtain the short-term training
required for employment by local or regional employers. While some
institutions have developed innovative programs to embed a short-term
program within a longer eligible degree or certificate program, such
programs may not meet the needs of all potential students. This is
especially true for students from low income backgrounds or those who
have work or family responsibilities that prevent them from enrolling
in longer term programs. In addition, it is hoped that, under this
experiment, institutions that currently offer longer term programs may
develop ways that shorten the student's time to completion--such as
asynchronous learning, competency based instruction, or other
innovative approaches. Such changes to the structure of training
programs may allow the program to be shorter than 15 weeks and still
maintain Pell Grant eligibility.
Description: This experiment would provide a waiver of the
requirement that a Pell Grant eligible program must include at least 15
weeks of instructional time and at least 600 clock hours, 16 semester
or trimester hours, or 24 quarter hours. It would allow Pell Grants to
be received by at least some otherwise eligible students who are
enrolled in a vocational program of at least eight weeks in length and
that, at a minimum, includes at least 150 clock hours of instructional
time, which is what some short-term vocational programs currently
provide. The amount of the Pell Grant provided to a student under this
experiment will be prorated for the shorter period of instructional
time, pursuant to the Pell Grant regulations at 34 CFR 690.63(a)(3).
The experiment will require that the short-term vocational program
at the community college or postsecondary vocational institution must
provide training needed to meet local or regional workforce needs, as
determined by the institution in consultation with employers or state
or local workforce agencies. As part of that consultation, the
institution must ensure that the content and instructional hours of the
program are (1) sufficient to meet hiring requirements of multiple
likely employers, and (2) sufficient to allow the students to apply for
any licenses or other certifications that may be required to be
employed in the field for which the training was offered.
As a condition of receiving Pell Grant funds under this experiment,
students must agree to provide career and employment information to the
institution for the period prior to enrolling in the program and for up
to two years following completion or withdrawal from the program. As an
option, the institution may provide information it obtains from an
alternative reliable source such as a state longitudinal data system.
The objective of this experiment is to determine if providing Pell
Grant funding to support unemployed or underemployed persons enrolled
in short-term vocational training programs offered by community
colleges and postsecondary vocational institutions increases employment
rates or wages of those persons.
Waivers: Institutions selected for this experiment will be exempt
from the following statutory and regulatory provisions:
HEA section 481(b)(1)(A), which sets the minimum
timeframes for a Pell Grant eligible program.
34 CFR 668.8(d)(1)(i) and (ii), which establish the
timeframes for eligible programs.
All other provisions of the Student Assistance General Provisions
regulations and the Federal Pell Grant regulations will remain in
effect.
Evaluation: This experiment will be evaluated by using information
provided by the institution, and any other information available to the
Secretary, to determine whether providing Pell Grant funding for low-
income students enrolled in short-term vocational programs results in
expanded and improved job placement for those students. The evaluation
will examine the employment status and, if possible, the earnings of
students participating in the program and their program completion
rates. It will also measure employment outcomes of students who were
enrolled in vocational programs that include at least 15 weeks of
instructional time and at least 600 clock hours.
As noted earlier, to support a recommendation for a change to a
legal requirement, data from both a treatment group of students who
participated in the experiment and a control or comparison group of
students who received their student aid under existing rules must be
evaluated. The Department is interested in gathering data under
circumstances that will allow for a reliable measurement of the impact
of the experiment. Because it is important that the outcomes for the
treatment group be compared to a group of students as similar to them
as possible, some students who otherwise meet the eligibility
requirements for this experiment may need to have their aid
administered under existing requirements.
[[Page 66702]]
Reporting Requirements: Institutions participating in this
experiment will be required to report information about the low-income
students enrolled in the short-term programs who receive Pell Grants
under this experiment and about non-Pell--eligible students enrolled in
the same (or similar) vocational program(s), and of students, if any,
who were enrolled in the program prior to the effective date of this
experiment. The data institutions participating in this experiment must
report will likely include: Enrollment counts; student employment and
income data, including participation, if any, in government assistance
programs; amounts of grant assistance received; program completion
data; information on the placement of students in applicable jobs,
including the number of different employers hiring graduates of the
program over the two years following the students' completion of the
program; and salary information of the students both before and after
program completion or withdrawal.
Experiment 3--Direct Loan Program--Single disbursement of a one--
term loan for study abroad students.
Background: Section 428G(a) of the HEA provides that with two
exceptions, Direct Loan Program loans must be disbursed at least twice
during the loan period and those disbursements must be substantially
equal. One of the exceptions allows for a single disbursement for an
institution's study abroad students if the institution's most recent
official Direct Loan/FFEL Program cohort default rate is less than five
percent. This exception allows students participating in a study abroad
program sponsored by a domestic institution to have money to help
offset their initial financial commitments, such as transportation
expenses, housing costs, visa fees, fees for immunizations, etc.
Additionally, many countries require, as the United States requires,
that students planning to attend postsecondary institutions provide
documentation of sufficient financial resources to cover their expenses
while in the country.
With the nationwide increase in default rates, many institutions
(mostly public and non-profit four-year institutions) fall just short
of the five percent cohort default rate threshold that would allow for
a single disbursement of a one-term Direct Loan to their study abroad
students. With the upcoming transition to three-year cohort default
rate calculations, it is expected that even fewer institutions will
meet the less-than-five-percent threshold.
Description: This experiment would provide a partial waiver to the
requirement that Direct Loan Program loans be disbursed in at least two
substantially equal disbursements during a loan period. It would allow
a single disbursement of a one-term loan for some study abroad students
attending a participating institution even if the institution's cohort
default rate equals or exceeds five percent.
The objective of this experiment is to determine if providing
needed early loan funding for students studying outside of the United
States increases participation in foreign educational experiences for
students without increasing the risk that the students will not
complete the loan period for which the funds were provided.
Waivers: Institutions selected for this experiment will be exempt
from the following statutory and regulatory provisions:
HEA section 428G(a), which generally requires multiple
disbursements of student loans.
34 CFR 685.301(b)(3)(ii), which requires at least two
disbursements of Direct Loan Program loan proceeds.
Instead, participating institutions will be permitted to make one
disbursement of a Direct Loan Program loan for study abroad students if
the loan period is one academic term. All other provisions of the
Student Assistance General Provisions regulations and the Direct Loan
Program regulations will remain in effect.
Evaluation: The Department will evaluate this experiment by using
information provided by the institution, and any other information
available to the Secretary, to determine whether the experiment allowed
more students, especially low-income students, to participate in study
abroad programs. It will also evaluate whether students assisted by the
experiment completed the loan period for which they received Direct
Loan funding in a single disbursement.
As noted earlier, to support a recommendation for a change to a
legal requirement, data must be provided from both a treatment group of
students who participated in the experiment and a control or comparison
group of students who received their student aid under existing rules.
Because it is important that outcomes for the treatment group be
compared to a group of students as similar to the treatment group as
possible, some students who otherwise meet the eligibility requirements
for this experiment may need to have their aid administered under
existing requirements.
Reporting Requirements: Institutions participating in this
experiment will be required to provide information on study abroad
students who received their loan proceeds in one disbursement under
this experiment as well as for study abroad students who received their
loan funds for an earlier payment period when at least two
disbursements were made. The information to be collected for these
groups will likely include the number of students in each group, the
amount of grant and loan assistance received, and the number of
students enrolled at the end of the loan period.
Experiment 4--Direct Loan Program--Early disbursement for students
participating in approved study abroad programs and students enrolled
in foreign institutions.
Background: Under the FFEL Program regulations at 34 CFR
682.207(b)(1)(v), a student who was participating in an approved study
abroad program or who was attending an eligible foreign institution
could, upon request of the institution and the approval of the FFEL
Program guaranty agency, have FFEL Program loan proceeds disbursed as
early as 30 days prior to the first day of classes of the academic term
(i.e. payment period). This is an exception to the Title IV Student
Assistance General Provisions regulations that generally provide that
no Title IV student assistance funds can be disbursed to a student
earlier than ten days prior to the first day of classes of the academic
term.
This FFEL Program exception was provided because of the unique
financial needs of students who study outside of the United States.
Such students typically need their student aid funds early to meet
obligations for travel to the site of their upcoming studies, to get
established in the foreign country (housing, etc.), and in some
instances to meet the foreign country's visa requirements.
Because prior to July 1, 2010, the only Title IV student assistance
a student attending an eligible foreign institution could receive was
FFEL Program funds, there was no need to provide a similar exception
for the Direct Loan Program. However, with the enactment of the SAFRA
within the Health Care and Education Reconciliation Act, students
attending foreign institutions (as well as those participating in
approved study aboard programs sponsored by U.S. host institutions),
must get their Title IV loans through the Direct Loan Program which
currently has no provision for early disbursement.
Description: This experiment would permit participating domestic
institutions to disburse Direct Loan funds for some students enrolled
in approved study abroad programs as
[[Page 66703]]
early as 30 days prior to the first day of classes of the student's
enrollment for the loan period. Similarly, participating foreign
institutions would be able to disburse Direct Loan funds as early as 30
days prior to the first day of classes of the student's enrollment for
the loan period.
As a condition of receiving an early disbursement of a Direct Loan
under this experiment, students must sign an agreement with the
institution allowing for the release of the student's academic records
and agreeing to participate in a study to determine the impact of the
early disbursement on their foreign study.
The objective of this experiment is to determine if providing early
disbursement of Direct Loan proceeds to students whose academic program
includes studying in a foreign country increases the number of students
who participate in such programs. It will also determine if
participating students are academically successful in their programs
because of the financial relief the early disbursement provides.
Waivers: Institutions selected for this experiment will be exempt
from the following statutory and regulatory provisions:
HEA section 428G, which provides the earliest date that
loan funds may be disbursed.
34 CFR 668.164(f), which provides that disbursements of
Direct Loan proceeds cannot occur any earlier than ten days prior to
the first day of classes for the payment period.
All other provisions of the Student Assistance General Provisions
regulations and the Direct Loan Program regulations will remain in
effect.
Evaluation: This experiment will be evaluated by using information
provided by the institution, and any other information available to the
Secretary, to determine if a broader range of students are able to
participate in foreign study and be successful. Information collected
from students will attempt to determine the effects of the early
disbursement. Finally, this experiment will carefully monitor academic
withdrawal rates as well as loan delinquencies and defaults for
participating students to determine if there are any abnormalities that
might be attributed to the early disbursement of loan proceeds.
As noted earlier, to support a recommendation for a change to a
legal requirement, data must be provided from both a treatment group of
students who participated in the experiment and a control or comparison
group of students who received their student aid under existing rules.
Because it is important that outcomes for the treatment group be
compared to a group of students as similar to the treatment group as
possible, some students who otherwise meet the eligibility requirements
for this experiment may need to have their aid administered under
existing requirements.
Reporting Requirements: Institutions participating in this
experiment will be required to report information on the students
participating in the experiment and also on other students (including
students from prior years) who were enrolled in study abroad programs
or at foreign institutions, as appropriate. The data to be collected
and analyzed for each group of students will likely include the number
of students, confirmation of the students' actual attendance at the
foreign institution, and the students' progress toward completion of
the foreign study program. Additionally, data will be collected from
the students participating in the experiment regarding the impact of
the early disbursement on their foreign study experience. And, for
students who were not participating in the experiment, data will be
collected on the impact on their foreign study experience of not
receiving their loan proceeds until, at the earliest, ten days before
the first day of classes for the academic term.
Experiment 5--Direct Loan Program--Unequal disbursements.
Background: Section 428G(a)(1) of the HEA provides that a student's
Direct Loan must be disbursed in two or more substantially equal
amounts. The dates of the disbursements usually coincide with the
educational program's academic terms (i.e., payment periods) that make
up the loan period. This provision generally works well since the costs
for most educational programs are usually reasonably spread out over
all of the payment periods that comprise the loan period. However, some
educational programs have up-front costs associated with the first
payment period of the loan period that are substantially higher than
costs for later payment periods. Such up-front costs could include
costs of required books and supplies that will be used throughout the
loan period, payment required to meet certain insurance or medical
requirements, and initial housing costs for students whose housing
changes as a result of enrolling in the educational program.
Financial aid administrators have suggested that for some students
in certain academic programs, receiving only half of their student loan
proceeds at the beginning of the loan period does not allow the student
to meet required up-front educational expenses. This can affect whether
the students (particularly low-income students) are able to enroll in
the program and, once enrolled, be academically successful.
Description: This experiment would waive the requirement that
Direct Loans be disbursed in at least two substantially equal
disbursements and would allow, under certain conditions, unequal
disbursements of Direct Loan proceeds. Institutions participating in
this experiment will be required to establish formal policies for
determining the conditions under which it would allow a student to
receive unequal disbursements of loan funds.
Under this experiment, no student may receive a single disbursement
of more than 75 percent of the total loan amount for the loan period,
and the same percentage must be applied to all of the student's loans
for the loan period (subsidized, unsubsidized, and PLUS loans). This
provision is to ensure that there are funds available for later in the
loan period. Any funds released in excess of the existing rules cannot
be applied to the student's institutional tuition and fee charges,
except for any charges directly related to the student obtaining
required books and supplies or housing provided by the institution.
Institutions must provide guidance to their Direct Loan borrowers
concerning the types of expenses that may qualify them for
consideration of unequal loan disbursements and what the acceptable
documentation is for each type of expense.
The objective of this experiment is to determine if providing more
up-front loan proceeds when the educational expenses are higher at the
beginning of the loan period increases the enrollment and program
completion of low-income students.
This experiment only applies to Direct Loan proceeds and does not
allow for unequal disbursements of Pell Grant funds.
Waivers: Institutions selected for this experiment will be exempt
from the following statutory and regulatory provisions:
HEA section 428G(a)(1), which requires that no Direct Loan
disbursement be for more than one-half of the total loan for the loan
period.
34 CFR 685.301(b)(5), which provides that no installment
of a Direct Loan exceed one-half of the loan for the loan period.
All other Direct Loan disbursement requirements will remain in effect.
Evaluation: This experiment will be evaluated by using information
provided by the institution, and any
[[Page 66704]]
other information available to the Secretary, to determine whether
allowing unequal disbursement of Direct Loans increases student
enrollment, increases academic performance, and leads to the students'
completion of the loan period and academic program.
As noted earlier, to support a recommendation for a change to a
legal requirement, data must be provided from both a treatment group of
students who participated in the experiment and a control or comparison
group of students who received their student aid under existing rules.
Because it is important that outcomes for the treatment group be
compared to a group of students as similar to the treatment group as
possible, some students who otherwise meet the eligibility requirements
for this experiment may need to have their aid administered under
existing requirements.
Reporting Requirements: Institutions participating in this
experiment will be required to report information on the students
participating in the experiment and also on students enrolled in the
same academic program who received substantially equal disbursements
and on students who received equal disbursements for loan periods prior
to the experiment. The measures for these groups will likely include
the number of students enrolled at the beginning of the loan period,
demographic information of the students, the amount of grant and loan
assistance awarded to each student, and completion and other academic
measures for the students. Institutions must, upon request of the
Secretary, submit a description of their policy for determining a
student's eligibility for unequal Direct Loan disbursements.
Experiment 6--Direct Loan Program--Limiting unsubsidized loan
amounts.
Background: Section 479A(c) of the HEA provides that institutions
may only reduce the amount of a student's Direct Loan eligibility on a
case-by-case, documented basis. They may not reduce eligibility on any
across-the-board programmatic or other categorical basis. Some in the
school community believe that this prohibition results in excessive
borrowing by some students, especially by students attending low-cost
institutions or those who live with their parents (or other family
members), or otherwise do not have significant housing expenses. The
schools also suggest that providing the statutorily established loan
amounts (especially after recent statutory increases) to all students
provides incentives for persons to enroll in low cost institutions only
to receive a cash disbursement of Federal grant and loan funds in
excess of direct institutional charges.
Institutions also argue that the requirement that they provide the
full loan amount to all students negatively affects the institution's
cohort default rates, thereby placing in jeopardy not only the
availability of the Direct Loan Program but also the Pell Grant Program
for all of the institution's students. Consequently, some low-cost
institutions, mostly community colleges, have chosen not to participate
in the loan programs at all, thus depriving otherwise eligible students
of access to low-cost Federal student loan assistance.
Some for-profit institutions argue that because of the requirement
that no more than 90 percent of their revenues can come from Title IV
student aid--the 90/10 rule--they must ensure that their tuition always
exceeds their students' Title IV eligibility. Thus, they cannot reduce
tuition and, as Title IV aid amounts increase (e.g., increases in the
maximum annual loan amounts), they often must raise tuition.
Description: This experiment would allow an institution to
establish a written policy where it would, for students enrolled in a
particular educational program or on some other categorical basis
(e.g., students living at home or first-time freshman), reduce by at
least $2,000 (the amount of the most recent statutory increase) the
amount of an unsubsidized Direct Loan that the otherwise eligible
student would receive, or eliminate the unsubsidized Direct Loan
completely.
The institution must continue to ensure that each eligible student
receives the full amount of any subsidized Direct Loan the student has
requested, up to the statutory maximums for subsidized loans.
Although this experiment will allow reductions in Direct Loan
amounts on other than a case-by-case basis, it would not allow
institutions to discriminate against any borrower or applicant on the
basis of race, national origin, religion, sex, marital status, age, or
disability status.
The Department anticipates that experiments in this area would
address at least one of three issues and requests that institutions
wishing to be considered for this experiment clearly state which of the
three following issues they wish to test.
(1) Over-borrowing. The one-size-fits-all nature of annual loan
limits may give some students access to more in Federal loans than they
need to complete their educational program. Some students may borrow
more than is justified by the economic prospects for completers of
their educational program (i.e., major course of study or vocational
area of concentration). Despite recent increases in loan limits, there
is little empirical evidence of the effect additional loan amounts have
on student access and completion. Experiments designed to address over-
borrowing would reduce students' annual unsubsidized loan limits by at
least $2,000, restoring those limits to no higher than their 2007-2008
level.
For-profit colleges interested in reducing their students' over-
borrowing are encouraged to apply to participate in this experiment
under both this issue and under issue 3, Unintended consequences at
for-profit colleges.
(2) Lack of loan availability. Paradoxically, the same limits that
may lead some students to borrow too much may prevent others from
borrowing at all. Some institutions, particularly community colleges,
have chosen not to participate in the Federal student loan programs, in
part because they are concerned that high cohort default rates could
jeopardize the Pell Grant eligibility of their students. As a result,
some students attending those institutions must work longer hours or
must use private student loans and credit cards to help finance their
education. Institutions that wish to be considered for this experiment
because they had previously chosen not to participate in the loan
programs, would, as a condition of the experiment, become participating
Direct Loan institutions and begin to make Direct Loans available to
their students under the terms of this experiment.
(3) Unintended consequences at for-profit colleges. Some for-profit
institutions argue that due to the 90/10 rule, they must set tuition
charges above their students' Title IV aid eligibility. As a result,
these institutions argue, increases in annual loan limits has the
perverse consequence of not allowing them to reduce tuition and, in
some instances, actually requires them to raise tuition. Additionally,
some of these institutions claim that because of the 90/10 rule, they
admit fewer financially needy students who bring with them increased
amounts of Title IV aid eligibility. Allowing reduced loan limits for
some for-profit institutions under this experiment will test these
claims and, if they are true, could result in some institutions
lowering tuitions. For-profit institutions wishing to participate in
this experiment for purposes of addressing tuition levels would be
required to include along with reductions in students' annual
unsubsidized loan eligibility of at least $2,000, reductions in tuition
of the same
[[Page 66705]]
amount. Requests to participate under this issue should address how
reducing loan limits may affect long term decisions on tuition or other
fees.
The Department is aware of the risks of reduced access to loans for
some students. Participating institutions will be required to describe
how they will ensure that their educational programs remain affordable
for students in all financial circumstances and that the institution
has maintained the economic and ethnic diversity of its students and
graduates. In addition, participating institutions will be expected to
describe how they will attempt to prevent increases in other forms of
debt by students whose unsubsidized loan amounts were reduced,
including increased use of private student loans and credit cards.
Participants will be required to report data on these commitments, and
experiments that are not meeting them will be terminated.
Institutions participating in this experiment must inform their
students and prospective students that the institution is participating
in the experiment and that the institution has established maximum loan
limits for unsubsidized loans that are less than the statutory
maximums.
Waivers: Institutions selected for this experiment will be exempt
from the following statutory and regulatory provisions:
HEA section 479A(c), which allows only case-by-case
reductions in Direct Loan amounts.
34 CFR 685.301(a)(8), which provides that reductions in a
student's eligibility for a Direct Loan can only be made on a case-by-
case basis.
All other Direct Loan requirements will be in effect.
Evaluation: This experiment will be evaluated by using information
provided by the institution, and any other information available to the
Secretary, to determine whether students who received less than the
statutory amounts of Direct Loans were able to enroll in, succeed, and
complete their academic programs. The Secretary will compare those
results with results from similar students who received the higher loan
amounts. An analysis of the effect of the experiment on the diversity
of the students enrolled in the institution will be conducted,
especially as it relates to the numbers of low-income students. The
evaluation will also attempt to determine if the lower educational loan
debt of the students in the experiment resulted in fewer delinquencies
and defaults.
As noted earlier, to support a recommendation for a change to a
legal requirement, data must be provided from both a treatment group of
students who participated in the experiment and a control or comparison
group of students who received their student aid under existing rules.
Because it is important that outcomes for the treatment group be
compared to a group of students as similar to the treatment group as
possible, some students who otherwise meet the eligibility requirements
for this experiment may need to have their aid administered under
existing requirements.
The Department will also evaluate this experiment by analyzing the
information reported by the participating institutions to determine
compliance with the experimental requirements that students do not
receive increased amounts of non-Federal financing and to determine
that participating for-profit institutions were able to reduce tuition
and fees during the term of the experiment by an amount equal to the
amount that student loan borrowing was reduced.
Reporting Requirements: The Secretary will require institutions
participating in this experiment to report information on the students
affected by the experiment and also on students enrolled in the same or
in a similar program when the experiment was not in effect. The
measures for these groups will likely include the number of enrolled
students and their demographic information; tuition charges; the amount
of grant and loan assistance awarded to each student; grades (or other
measures of academic performance); the number of students enrolled at
the beginning of the loan period; the number of withdrawals; the number
of completions; and average student debt levels, including non-Federal
debts.
Institutions must, upon the request of the Secretary, submit a
description of their policy and procedures for determining the amount
of the reduced loan eligibility.
Experiment 7--Direct Loan Program--PLUS Loans for parents of
students with intellectual disabilities.
Background: Pursuant to section 484(s) of the HEA, students with
intellectual disabilities who are enrolled in an approved comprehensive
transition and postsecondary program (transition program) are eligible
to receive funding from the Pell, Federal Work Study (FWS), and Federal
Supplemental Educational Opportunity Grant (FSEOG) programs,
notwithstanding that the students are not enrolled in an academic
program that leads to a postsecondary educational credential. This
statutory provision specifically provides that such students may not
receive support from the Title IV loan programs. Because of this, an
otherwise eligible parent is unable to receive a Direct PLUS loan to
help offset the educational costs for their intellectually disabled son
or daughter to enroll in an approved transition program. This places
the family in a difficult financial situation when educational costs
exceed, sometimes significantly, the limited other Title IV aid that
may be available. This is, of course, particularly true for the parents
of students who are not Pell or FSEOG eligible, arguably the target
group for parent PLUS loans. Many of these parents may be forced to
rely on less favorable private financing to support their child's
education.
Description: This experiment would permit participating
institutions to originate and disburse Direct PLUS loans to the
otherwise eligible parents of dependent students with intellectual
disabilities, as defined in the Department's regulations at 34 CFR
668.231(b), who are enrolled in an approved comprehensive transition
and postsecondary program (transition program), as defined in the
Department's regulations at 34 CFR 668.231(a). As a condition of the
parent receiving a Direct PLUS loan under this experiment, the student,
or the student's parent(s) if required, must sign an agreement with the
institution allowing for the release to the Department of the student's
academic and other records related to the student's participation in
the transition program. The release must also provide that the student
(or parent) will provide information on the student's post enrollment
living and occupational status. Additionally, the parents must agree to
provide the institution, for release to the Secretary, general
information concerning how the family financed the student's attendance
in the transition program.
The objective of this experiment is to determine if by providing
this financing option to some parents, more students with intellectual
disabilities will enroll in and complete an approved transition
program. Another objective is to reduce the parents' debt burden caused
by higher interest rates from non-Federal financing.
Waivers: Institutions selected for this experiment will be exempt
from the following statutory and regulatory provisions:
The portion of HEA section 484(s) that provides that
students with intellectual disabilities who are enrolled in an approved
comprehensive transition and postsecondary program may only receive
Title IV funding from
[[Page 66706]]
the Pell Grant, FSEOG, and FWS programs.
34 CFR 668.230, which states that the only programs a
student with intellectual disabilities who is enrolled in a
comprehensive transition and postsecondary program is eligible for are
the Pell Grant, FSEOG, and FWS programs.
All other Student Assistance General Provisions regulations and Direct
Loan regulations, including all of the Direct PLUS Loan requirements of
34 CFR Part 685, will remain in effect.
Evaluation: This experiment will be evaluated by using information
provided by the institution, and any other information available to the
Secretary, to determine if making Direct PLUS loans available to the
parents of students with intellectual disabilities who are enrolled in
a transition program, increases the participation of those students and
increases the likelihood of the students completing the transition
program. The experiment will also test to see if the availability of
PLUS loans reduces the reliance by the parents on non-Federal loans and
other less favorable financing.
As noted earlier, to support a recommendation for a change to a
legal requirement, data must be provided from both a treatment group
and a control or comparison group. Because it is important that
outcomes for the treatment group be compared to a group as similar to
the treatment group as possible, some students who otherwise meet the
eligibility requirements for this experiment may need to have their aid
administered under existing requirements.
Reporting Requirements: Institutions participating in this
experiment will be required to report information on the students and
parents who benefit from the PLUS loan and on those who did not. The
data to be collected and analyzed will likely include the number of
students enrolled in the transition program; the types and amounts of
Title IV aid received by the students and, if applicable, by the
parents; and information on the students' enrollment in, and completion
of, the transition program. Additional data will be collected from
parents regarding the need for other educational financing.
Experiment 8--Student Eligibility--Eligibility of students with
intellectual disabilities who are also enrolled in high school.
Background: Pursuant to section 484(s) of the HEA, students with
intellectual disabilities who are enrolled in an approved comprehensive
transition and postsecondary program (transition program) are eligible
to receive funding from the Pell, Federal Work Study (FWS), and Federal
Supplemental Educational Opportunity Grant (FSEOG) programs,
notwithstanding that the students are not enrolled in an academic
program that leads to a postsecondary educational credential. Section
484(a)(1) of the HEA specifically prohibits any student from receiving
Title IV assistance if the student is also enrolled in a secondary
school (i.e., high school) and no statutory exception was provided for
students enrolled in transition programs. Since the purpose of these
comprehensive transition and postsecondary programs is to provide
transition training to students who have intellectual disabilities,
many of these students would benefit significantly from enrolling in
the transition program at the postsecondary institution while still
completing their high school curriculum. For many of these students
enrolling in the postsecondary transition program while still in high
school offers them the best chance for academic, vocational, and life
success.
Description: This experiment would permit some students with
intellectual disabilities who are enrolled in an approved comprehensive
transition and postsecondary program at a Title IV eligible institution
while also enrolled in secondary school--dually enrolled students--to
receive Title IV funding, notwithstanding the general prohibition of
eligibility for such students because of their dual enrollment.
Institutions participating in this experiment will be required to
obtain assurances from other entities that provide education services
or financial support to students participating in the experiment,
including local education agencies (LEAs) and State Vocational
Rehabilitation Agencies, that those entities will maintain their
support for the students receiving Federal financial aid under this
experiment or to the students' families, unless the entity is legally
prohibited from doing so.
The objective of this experiment is to determine if, by providing
Title IV aid to otherwise eligible students with intellectual
disabilities who are enrolled in an approved transition program while
also enrolled in high school, the transition process for the students
can be improved without placing financial burdens on their families.
Waivers: Institutions selected for this experiment will be exempt
from the following statutory and regulatory provisions, but only for
students with intellectual disabilities who are enrolled in approved
transition programs:
The provision of HEA section 484(a)(1) that precludes
students who are enrolled in secondary school from receiving Title IV
aid.
34 CFR 668.32(b), which excludes elementary or secondary
school students from eligibility for Title IV assistance.
All other student eligibility requirements would remain in effect as
would the specific requirements of each of the Title IV student
assistance programs.
Evaluation: This experiment will be evaluated by using information
provided by the institution, and any other information available to the
Secretary, to determine if more intellectually disabled students enroll
in and complete a comprehensive transition and postsecondary program
than would have without the experiment. The evaluation will assess the
success of dually enrolled students in the transition program relative
to their peers who were not also enrolled in high school.
As noted earlier, to support a recommendation for a change to a
legal requirement, data must be provided from both a treatment group of
students who participated in the experiment and a control or comparison
group of students who received their student aid under existing rules.
Because it is important that outcomes for the treatment group be
compared to a group of students as similar to the treatment group as
possible, some students who otherwise meet the eligibility requirements
for this experiment may need to have their aid administered under
existing requirements.
Reporting Requirements: Institutions participating in this
experiment will be required to report information on the students
participating in the experiment and also on students enrolled in the
transition program who were not also enrolled in high school. The data
to be collected and analyzed for each group of students will likely
include the number of students; the types and amounts of Title IV and
other student aid received; the students' progress toward completion of
the high school curriculum and progress toward completion of the
transition program curriculum; and, where appropriate, employment
information of the students who complete the transition program.
As a condition of the student receiving Title IV aid while enrolled
in high school under this experiment, the student, or the student's
parent(s), if required, must sign an agreement with the institution
allowing for the release to the Department of the student's academic
and other records related to
[[Page 66707]]
the student's participation in the transition program. The release must
also provide that the student (or parent) will provide information on
the student's post enrollment living and occupational status.
Institutions participating in this experiment will be required to
provide information on whether other educational service providers
maintained the students' programmatic and financial support while the
student was still enrolled in high school.
Accessible Formats: Individuals with disabilities can obtain this
document in an accessible format (e.g. braille, large print, audiotape,
or compact disc) on request to the contact person listed under FOR
FURTHER INFORMATION CONTACT.
Electronic Access to This Document: 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 via the Federal Digital System
at: https://www.gpo.gov/fdsys. At this site you can view this document,
as well as all other documents of this Department published in the
Federal Register, in text or Adobe Portable Document Format (PDF). To
use PDF, you must have Adobe Acrobat Reader, which is available free at
the site.
You may also access documents of the Department published in the
Federal Register by using the article search feature at: https://www.federalregister.gov. Specifically, through the advanced search
feature at this site, you can limit your search to documents published
by the Department.
Program Authority: Section 487A(b); 20 U.S.C. 1094a(b).
Dated: October 21, 2011.
Eduardo M. Ochoa,
Assistant Secretary for Postsecondary Education.
[FR Doc. 2011-27880 Filed 10-26-11; 8:45 am]
BILLING CODE 4000-01-P