Annual Updates to the Income Contingent Repayment (ICR) Plan Formula for 2012; William D. Ford Federal Direct Loan Program, 30266-30272 [2012-12420]
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Federal Register / Vol. 77, No. 99 / Tuesday, May 22, 2012 / Notices
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Title of Collection: Direct Loan
Income Contingent Repayment Plan
Alternative Documentation of Income.
OMB Control Number: 1845–0016.
Type of Review: Revision.
Total Estimated Number of Annual
Responses: 294,924.
Total Estimated Number of Annual
Burden Hours: 73,731.
Abstract: This form serves as the
means by which a borrower who is
repaying Direct Loan Program loans
under the Income-Contigent Repayment
(ICR) Plan or the Income-Based
Repayment (IBR) Plan provides the U.S.
Department of Education (the
Department) with alternative
documentation of the borrower’s
income. If the borrower’s adjusted gross
income (AGI) is not available from the
IRS, or if the Department believes that
the borrower’s most recently reported
AGI does not accurately reflect the
borrower’s current income. Under the
Direct Loan Program regulations, a
borrower’s AGI is used to calculate the
monthly loan repayment amount under
the ICR and IBR plans.
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SUPPLEMENTARY INFORMATION:
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Dated: May 17, 2012.
Darrin A. King,
Director, Information Collection Clearance
Division, Privacy, Information and Records
Management Services, Office of Management.
[FR Doc. 2012–12416 Filed 5–21–12; 8:45 am]
BILLING CODE 4000–01–P
DEPARTMENT OF EDUCATION
Annual Updates to the Income
Contingent Repayment (ICR) Plan
Formula for 2012; William D. Ford
Federal Direct Loan Program
Federal Student Aid,
Department of Education.
ACTION: Notice.
AGENCY:
Catalog of Federal Domestic
Assistance (CFDA) Number: 84.063.
SUMMARY: The Secretary announces the
annual updates to the ICR plan formula
for 2012. Under the William D. Ford
Federal Direct Loan (Direct Loan)
Program, borrowers may choose to repay
their loans (Direct Subsidized Loans,
Direct Unsubsidized Loans, Direct PLUS
Loans made to graduate or professional
students, and Direct Consolidation
Loans) under the ICR plan, which bases
the repayment amount on the
borrower’s income, family size, loan
amount, and the interest rate applicable
to each loan. Each year, we adjust the
formula for calculating a borrower’s ICR
payment to reflect changes due to
inflation. This notice contains the
adjusted income percentage factors for
2012, examples of how the calculation
of the monthly ICR amount is
performed, a constant multiplier chart
for use in performing the calculations,
and charts showing sample repayment
amounts based on the adjusted ICR plan
formula. The adjustments to the income
percentage factors for the ICR plan
formula, contained in this notice, are
effective for the period from July 1, 2012
to June 30, 2013.
FOR FURTHER INFORMATION CONTACT: Ian
Foss, U.S. Department of Education, 830
First St. NE., Room 114I1, Washington,
DC 20202. Telephone: (202) 377–3681
or by email: ian.foss@ed.gov.
If you use a telecommunications
device for the deaf (TDD) or a text
telephone (TTY), call the Federal Relay
Service (FRS), toll free, at 1–800–877–
8339.
Individuals with disabilities can
obtain this document in an accessible
format (e.g., braille, large print,
audiotape, or compact diskette) on
request to the contact person listed
under FOR FURTHER INFORMATION
CONTACT in this section of the notice.
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Direct
Loan Program borrowers may choose to
repay their Direct Subsidized Loans,
Direct Unsubsidized Loans, Direct PLUS
Loans made to graduate or professional
students, and Direct Consolidation
Loans under the ICR plan. This notice
contains the following four attachments:
• Attachment 1—Income Percentage
Factors for 2012
• Attachment 2—Constant Multiplier
Chart for Use in Calculating the
Monthly ICR Amount
• Attachment 3—Examples of the
Calculations of Monthly Repayment
Amounts
• Attachment 4—Charts Showing
Sample Repayment Amounts for
Single and Married Borrowers
In Attachment 1, we have updated the
income percentage factors to reflect
changes based on inflation. Specifically,
we have revised the table of income
percentage factors by changing the
dollar amounts of the incomes shown by
a percentage equal to the estimated
percentage change in the Consumer
Price Index for all urban consumers
from December 2011 to December 2012.
In Attachment 2, we provide a constant
multiplier chart for a 12-year loan
amortization. Further, in Attachment 3,
we provide examples of monthly
repayment amount calculations. Finally,
in Attachment 4, we provide two charts
that show sample repayment amounts
for single and married or head-ofhousehold borrowers at various income
and debt levels based on the updated
income percentage factors.
The updated income percentage
factors reflected in Attachment 1 may
cause a borrower’s payments to be lower
than they were in prior years (even if
the borrower’s income remains the same
as the prior year). However, the revised
repayment amount more accurately
reflects the impact of inflation on a
borrower’s current ability to repay.
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The official version of this document is
the document published in the Federal
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official edition of the Federal Register
and the Code of Federal Regulations is
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Federal Register / Vol. 77, No. 99 / Tuesday, May 22, 2012 / Notices
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Program Authority: 20 U.S.C. 1087 et seq.
30267
Dated: May 17, 2012.
James W. Runcie,
Chief Operating Officer, Federal Student Aid.
Attachment 1—Income Percentage
Factors for 2012
INCOME PERCENTAGE FACTORS FOR 2012
[Based on annual income]
Single
Married/head of household
Income
% Factor
$10,470 .........................................................................
14,406 ...........................................................................
18,537 ...........................................................................
22,761 ...........................................................................
26,797 ...........................................................................
31,884 ...........................................................................
40,048 ...........................................................................
50,226 ...........................................................................
60,409 ...........................................................................
72,603 ...........................................................................
92,966 ...........................................................................
131,671 .........................................................................
150,973 .........................................................................
268,909 .........................................................................
Attachment 2—Constant Multiplier
Chart for use in Calculating the
Monthly ICR Amount
CONSTANT MULTIPLIER CHART FOR
12-YEAR AMORTIZATION
Interest rate (%)
3.500
4.000
4.500
5.000
5.500
6.000
6.800
7.000
7.900
8.000
8.250
.....................................
.....................................
.....................................
.....................................
.....................................
.....................................
.....................................
.....................................
.....................................
.....................................
.....................................
Annual
constant
multiplier
0.102174
0.105063
0.108001
0.110987
0.114021
0.117102
0.122130
0.123406
0.129237
0.129894
0.131545
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Attachment 3—Examples of the
Calculations of Monthly Repayment
Amounts
General notes about the examples in
this attachment:
• The interest rates used in the
examples are for illustration only.
Actual interest rates vary depending on
loan type and when a loan was first
disbursed.
• In the examples, the Poverty
Guideline amounts used are from the
2012 U.S. Department of Health and
Human Services (HHS) Poverty
Guidelines for the 48 contiguous States
and the District of Columbia, as
published in the Federal Register on
January 26, 2012 (77 FR 4034). Different
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55.00
57.79
60.57
66.23
71.89
80.33
88.77
100.00
100.00
111.80
123.50
141.20
150.00
200.00
Income
% Factor
$10,470 ........................................................................
16,520 ..........................................................................
19,687 ..........................................................................
25,737 ..........................................................................
31,884 ..........................................................................
40,048 ..........................................................................
50,225 ..........................................................................
60,409 ..........................................................................
75,682 ..........................................................................
101,129 ........................................................................
136,758 ........................................................................
191,263 ........................................................................
312,539 ........................................................................
......................................................................................
50.52
56.68
59.56
67.79
75.22
87.61
100.00
100.00
109.40
125.00
140.60
150.00
200.00
........................
Poverty Guidelines apply to residents of
Alaska and Hawaii.
• The ‘‘constant multiplier’’ included
in each example is a factor used to
calculate amortized payments at a given
interest rate over a fixed period of time.
Refer to the constant multiplier chart
provided in Attachment 2 to this notice
to determine the constant multiplier
that should be used for a specific
interest rate. If an interest rate is not
listed in the constant multiplier chart in
Attachment 2, use the next highest rate
for estimation purposes.
• All examples use an income
percentage factor corresponding to the
borrower’s adjusted gross income (AGI).
If the AGI is not listed in the income
percentage factors table in Attachment
1, calculate the applicable income
percentage factor for the AGI by
following the instructions under the
Interpolation heading later in this
attachment.
• For married borrowers, the
outstanding balance on the loans of each
borrower and both borrowers’ AGIs are
added together to determine the ICR
payment amount. The amount of each
payment applied to each borrower’s
Direct Loan debt is the proportion of the
payments that equals the same
proportion as that borrower’s debt to the
total outstanding balance. Each
borrower is billed separately. For
example, if a married couple has a total
outstanding Direct Loan debt of $60,000,
$40,000 of which belongs to one spouse,
and $20,000 of which belongs to the
other spouse, 67 percent of the monthly
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ICR payment would be apportioned to
the spouse with the outstanding debt of
$40,000, with the remaining 33 percent
of the monthly ICR payment being
apportioned to the spouse with $20,000
of debt. To take advantage of a joint ICR
payment, married couples need not file
taxes jointly; they may file separately
and subsequently provide the other
spouse’s tax information.
Example 1. This example assumes that the
borrower is single with no dependents, and
has $15,000 in Direct Subsidized and
Unsubsidized Loans. The interest rate on
these loans is 6.80 percent, and the borrower
has an AGI of $40,048.
Step 1: Determine the total annual
payment amount based on what the
borrower would pay over 12 years using
standard amortization. To do this,
multiply the loan balance by the
constant multiplier for the applicable
interest rate. In this example, the
interest rate is 6.80 percent, for which
the constant multiplier is 0.122130.
• 0.122130 × $15,000 = $1,831.95
• Step 2: Multiply the result of Step 1
by the income percentage factor
shown in the income percentage
factors table (see Attachment 1 to
this notice) that corresponds to the
AGI and then divide the result by
100:
• 88.77 × $1,831.95 ÷ 100 = $1,626.22
Step 3: Determine 20 percent of the
borrower’s discretionary income
(discretionary income is AGI minus the
U.S. Department of Health and Human
Services (HHS) Poverty Guideline
amount for the borrower’s family size
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Federal Register / Vol. 77, No. 99 / Tuesday, May 22, 2012 / Notices
and state of residence). To do this,
subtract the Poverty Guideline amount
for a family of one, for this example,
from the borrower’s AGI and multiply
the result by 20 percent:
• $40,048¥$11,170 = $28,878
• $28,878 × 0.20 = $5,775.60
Step 4: Compare the amount from
Step 2 with the amount from Step 3.
The lower of the two will be the annual
payment amount. In this example, the
borrower will be paying the amount
calculated under Step 2 ($1,626.22). To
determine the monthly repayment
amount, divide the annual amount by
12.
• $1,626.22 ÷ 12 = $135.52
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Example 2. In this example, the borrower
is married and has no dependents, other than
a spouse. The borrower has a Direct Loan
balance of $10,000, and the spouse has a
Direct Loan balance of $15,000. The interest
rate on all of the loans is 6.80 percent.
The borrower and spouse have a combined
AGI of $75,682 and are repaying their loans
jointly under the ICR plan (for general
information regarding joint ICR payments for
married couples, see the fifth bullet under
the heading entitled ‘‘General notes about the
examples’’ in this attachment).
Step 1: Add the borrower’s and the
borrower’s spouse’s Direct Loan
balances together to determine their
combined aggregate loan balance:
• $10,000 + $15,000 = $25,000
Step 2: Determine the combined total
annual payment amount for these
borrowers based on what both
borrowers would pay over 12 years
using standard amortization. To do this,
multiply the combined loan balance by
the constant multiplier for the
applicable interest rate. In this example,
the interest rate is 6.80 percent, for
which the constant multiplier is
0.122130.
• 0.122130 × $25,000 = $3,053.25
Step 3: Multiply the result of Step 2
by the income percentage factor shown
in the income percentage factors table in
Attachment 1 that corresponds to the
borrower’s and the borrower’s spouse’s
combined AGI and then divide the
result by 100:
• 109.40 × $3,053.25 ÷ 100 = $3,340.26
Step 4: Determine 20 percent of
discretionary income. To do this,
subtract the Poverty Guideline amount
for a family of two, in this example,
from the combined AGI and multiply
the result by 20 percent:
• $75,682 ¥ $15,130 = $60,552
• $60,552 × 0.20 = $12,110.40
Step 5: Compare the amount from
Step 3 with the amount from Step 4.
The lower of the two will be the annual
payment amount for the borrower and
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the borrower’s spouse. The borrower
and the borrower’s spouse will jointly
pay the amount calculated under Step 3
($3,340.26). To determine the monthly
repayment amount, divide the annual
amount by 12.
• $3,340.26 ÷ 12 = $278.36
Example 3. This example assumes that the
borrower is single with no dependents and
has $15,000 in Direct Subsidized and
Unsubsidized Loans. The interest rate on all
of the loans is 6.80 percent, and the
borrower’s AGI is $31,884.
Step 1: Determine the total annual
payment amount based on what the
borrower would pay over 12 years using
standard amortization. To do this,
multiply the loan balance by the
constant multiplier for the applicable
interest rate. In this example, the
interest rate is 6.80 percent, for which
the constant multiplier is 0.122130.
• 0.122130 × $15,000 = $1,831.95
Step 2: Multiply the result of Step 1
by the income percentage factor shown
in the income percentage factors table in
Attachment 1 that corresponds to the
borrower’s income and then divide the
result by 100:
• 80.33 × $1,831.95 ÷ 100 = $1,471.61
Step 3: Determine 20 percent of
discretionary income (discretionary
income is the borrower’s AGI minus the
HHS Poverty Guideline amount for the
borrower’s family size). To do this,
subtract the Poverty Guideline amount
for a family of one, in this example,
from AGI and multiply the result by 20
percent:
• $31,884 ¥ $11,170 = $20,714
• $20,714 × 0.20 = $4,142.80
Step 4: Compare the amount from
Step 2 with the amount from Step 3.
The lower of the two will be the annual
payment amount. In this example, the
borrower will be paying the amount
calculated under Step 2 ($1,471.61). To
determine the monthly repayment
amount, divide the annual amount by
12.
• $1,471.61 ÷ 12 = $122.63
Example 4. In this example, the borrower
is married and has no dependents, other than
the spouse. The borrower and spouse have a
combined AGI of $40,048 and are repaying
their loans under the ICR plan (for general
information regarding joint ICR payments for
married couples, see the fifth bullet under
the heading entitled ‘‘General notes about the
examples’’ in this attachment). The borrower
has a Direct Loan balance of $10,000, $5,000
of which is at an interest rate of 6.80 percent
and $5,000 of which is at an interest rate of
7.0 percent. The spouse has a Direct Loan
balance of $15,000, $5,000 of which is at an
interest rate of 6.80 percent and $10,000 of
which is at an interest rate of 7.0 percent.
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Step 1: Add the borrower’s and the
borrower’s spouse’s Direct Loan
balances that have the same interest rate
together to determine combined
aggregate loan balances by interest rate:
• 6.8 percent: $5,000 + $5,000 =
$10,000
• 7.0 percent: $5,000 + $10,000 =
$15,000
Step 2: Determine the annual payment
based on what would be paid over 12
years using standard amortization for
each interest rate-based group of
combined aggregate loan balances. To
do this, multiply each group of
combined aggregate loan balances by the
constant multiplier for the applicable
interest rate. For 6.80 percent, the
constant multiplier is 0.122130. For 7.0
percent, the constant multiplier is
0.123406.
• 0.122130 × $10,000 = $1,221.30
• 0.123406 x $15,000 = $1,851.09
Step 3: Add the products of Step 2
together, multiply that total by the
income percentage factor shown in the
income percentage factors table in
Attachment 1 that corresponds to the
borrower’s and the borrower’s spouse’s
combined AGI, and then divide the
result by 100:
• $1,221.30 + $1,851.09 = $3,072.39
• 87.61 × $3,072.39 ÷ 100 = $2,691.72
Step 4: Determine 20 percent of
discretionary income. To do this,
subtract the Poverty Guideline amount
for a family of two, in this example,
from the combined AGI and multiply
the result by 20 percent:
• $40,048—$15,130 = $24,918
• $24,918 × 0.20 = $4,983.60
Step 5: Compare the amount from
Step 3 with the amount from Step 4.
The lower of the two will be the annual
payment amount. In this example, the
borrower and the borrower’s spouse will
jointly pay the amount calculated under
Step 3 ($2,691.72). To determine the
monthly repayment amount, divide the
annual amount by 12.
• $2,691.72 ÷ 12 = $224.31
Interpolation. If the borrower’s
income is not included on the income
percentage factor table, calculate the
income percentage factor through
interpolation. For example, assume that
the borrower is single with an income
of $30,000.
Step 1: Find the closest income listed
that is less than $30,000 and the closest
income listed that is greater than
$30,000.
Step 2: Subtract the lower amount
from the higher amount (for this
discussion, we will call the result the
‘‘income interval’’):
• $31,884 ¥ $26,797 = $5,087
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Step 3: Determine the difference
between the two income percentage
factors that correspond to the incomes
used in Step 2 (for this discussion, we
will call the result the ‘‘income
percentage factor interval’’):
• 80.33 percent ¥ 71.89 percent = 8.44
percent
Step 4: Subtract from the borrower’s
income the closest income shown on the
chart that is less than the borrower’s
income of $30,000:
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• $30,000 ¥ $26,797 = $3,203
Step 5: Divide the result of Step 4 by
the income interval determined in Step
2:
• $3,203 ÷ $5,087 = 0.6296
Step 6: Multiply the result of Step 5
by the income percentage factor
interval:
• 8.44 percent × 0.6296 = 5.314 percent
Step 7: Add the result of Step 6 to the
lower of the two income percentage
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30269
factors used in Step 3 to calculate the
income percentage factor interval for
$30,000 in income:
• 5.314 percent + 71.89 percent = 77.20
percent (rounded to the nearest
hundredth)
The result is the income percentage
factor that will be used to calculate the
monthly repayment amount under the
ICR plan.
BILLING CODE 4000–01–C
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[FR Doc. 2012–12420 Filed 5–21–12; 8:45 am]
BILLING CODE 4000–01–C
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Federal Register / Vol. 77, No. 99 / Tuesday, May 22, 2012 / Notices
30272
Federal Register / Vol. 77, No. 99 / Tuesday, May 22, 2012 / Notices
DEPARTMENT OF ENERGY
Federal Energy Regulatory
Commission
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Combined Notice of Filings #2
Take notice that the Commission
received the following electric rate
filings:
Docket Numbers: ER06–771–003;
ER06–772–003
Applicants: Cross & Company PLLC
Description: Supplemental
Information to Triennial Market-Power
Filing of ExxonMobil Entities.
Filed Date: 5/7/12
Accession Number: 20120507–5061
Comments Due: 5 p.m. ET 5/29/12
Docket Numbers: ER10–2172–008;
ER10–2179–011; ER11–2016–003;
ER10–2184–008; ER10–2183–005;
ER10–1048–005; ER10–2176–009;
ER10–2192–008; ER11–2056–002;
ER10–2178–008; ER10–2174–008;
ER11–2014–005; ER11–2013–005;
ER10–3308–007; ER10–1017–004;
ER10–1020–004; ER10–1145–004;
ER10–1144–003; ER10–1078–004;
ER10–1079–004; ER10–1080–004;
ER11–2010–005; ER10–1081–004;
ER10–2180–008; ER11–2011–004;
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ER10–1143–004; ER10–2182–011;
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Applicants: Baltimore Gas and
Electric Company, Wind Capital
Holdings, LLC, Harvest WindFarm, LLC,
CER Generation II, LLC, Handsome Lake
Energy, LLC, Exelon New England
Power Marketing, LP, Exelon
Framingham, LLC, Exelon New Boston,
LLC, Exelon West Medway, LLC, Exelon
Wyman, LLC, Exelon Generation
Company, LLC, Exelon Energy
Company, CER Generation, LLC, PECO
Energy Company, Commonwealth
Edison Company, Constellation Energy
Commodities Group, Constellation
NewEnergy, Inc., Calvert Cliffs Nuclear
Power Plant, LLC, Exelon Generation
Company, LLC, Constellation Energy
Commodities Group Maine, LLC, Nine
Mile Point Nuclear Station, LLC,
Constellation Mystic Power, LLC,
Michigan Wind 1, LLC, Tuana Springs
Energy, LLC, CR Clearing, LLC, Exelon
Wind 4, LLC, Michigan Wind 2, LLC,
Criterion Power Partners, LLC,
Constellation Power Source Generation,
Inc., MXenergy Electric Inc., Wildcat
Wind, LLC, Cassia Gulch Wind Park,
LLC, Cow Branch Wind Energy, LLC,
R.E. Ginna Nuclear Power Plant, LLC
Description: Supplement to
Notification of Change in Status of
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Baltimore Gas and Electric Company, et
al.
Filed Date: 5/14/12
Accession Number: 20120514–5183
Comments Due: 5 p.m. ET 6/4/12
Docket Numbers: ER12–1780–000;
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2240–001; ER11–2241–001; ER11–2242–
001; ER11–2243–001; ER11–2244–001;
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ER10–2231–002; ER10–1714–003;
ER10–1511–003
Applicants: PPL Ironwood, LLC, PPL
Ironwood, LLC, Lower Mount Bethel
Energy, LLC, PPL Brunner Island, LLC,
PPL Colstrip I, LLC, PPL Colstrip II,
LLC, PPL Electric Utilities Corporation,
PPL Energy Supply, LLC, PPL
EnergyPlus, LLC, PPL Great Works, LLC,
PPL Holtwood, LLC, PPL Maine, LLC,
PPL Martins Creek, LLC, PPL Montana,
LLC, PPL Montour, LLC, PPL New
Jersey Biogas, LLC, PPL New Jersey
Solar, LLC, PPL Renewable Energy, LLC,
PPL Susquehanna, LLC, Electric Energy,
Inc., Kentucky Utilities Company, LG&E
Energy Marketing, Inc., Louisville Gas
and Electric Company
Description: Market-Based Rate Notice
of Change in Status of the PPL
Companies.
Filed Date: 5/14/12
Accession Number: 20120514–5194
Comments Due: 5 p.m. ET 6/4/12
Docket Numbers: ER10–2877–001
Applicants: Cobb Electric
Membership Corp.
Description: COBB Electric
Membership Corp., Amendment to
Updated Market Power Analysis.
Filed Date: 4/27/12
Accession Number: 20120427–5423
Comments Due: 5 p.m. ET 5/18/12
The filings are accessible in the
Commission’s eLibrary system by
clicking on the links or querying the
docket number.
Any person desiring to intervene or
protest in any of the above proceedings
must file in accordance with Rules 211
and 214 of the Commission’s
Regulations (18 CFR 385.211 and
385.214) on or before 5:00 p.m. Eastern
time on the specified comment date.
Protests may be considered, but
intervention is necessary to become a
party to the proceeding.
eFiling is encouraged. More detailed
information relating to filing
requirements, interventions, protests,
service, and qualifying facilities filings
can be found at: https://www.ferc.gov/
docs-filing/efiling/filing-req.pdf. For
PO 00000
Frm 00013
Fmt 4703
Sfmt 4703
other information, call (866) 208–3676
(toll free). For TTY, call (202) 502–8659.
Dated: May 15, 2012.
Nathaniel J. Davis, Sr.,
Deputy Secretary.
[FR Doc. 2012–12309 Filed 5–21–12; 8:45 am]
BILLING CODE 6717–01–P
DEPARTMENT OF ENERGY
Federal Energy Regulatory
Commission
Combined Notice of Filings #1
Take notice that the Commission
received the following electric corporate
filings:
Docket Numbers: EC12–103–000.
Applicants: Emera Incorporated,
Algonquin Power & Utilities Corp.
Description: Application under FPA
Section 203 of Emera Incorporated and
Algonquin Power & Utilities Corp.
Filed Date: 5/14/12.
Accession Number: 20120514–5145.
Comments Due: 5 p.m. ET 6/4/12.
Take notice that the Commission
received the following electric rate
filings:
Docket Numbers: ER10–1141–001;
ER10–1139–001; ER10–1151–004;
ER10–1103–001; ER10–1123–001;
ER10–3247–004.
Applicants: Ameren Energy Marketing
Company, Ameren Energy Generating
Company, Electric Energy Inc.,
AmerenEnergy Medina Valley Cogen,
LLC, AmerenEnergy Resources
Generating Company, Ameren Illinois
Company, Union Electric Company.
Description: Addendum to Triennial
Market Power Update of Ameren
Companies.
Filed Date: 5/1/12.
Accession Number: 20120501–5447.
Comments Due: 5 p.m. ET 5/22/12.
Docket Numbers: ER12–1351–001.
Applicants: PJM Interconnection,
LLC.
Description: Errata filing to correct
Section 3.2 of the PJM OATT Att K
Appx & OA Schedule 1 to be effective
4/1/2012.
Filed Date: 5/14/12.
Accession Number: 20120514–5075.
Comments Due: 5 p.m. ET 6/4/12.
Docket Numbers: ER12–1764–000.
Applicants: Amplified Power & Gas,
LLC.
Description: Supplement the record
Docx 2010 problem to be effective N/A.
Filed Date: 5/14/12.
E:\FR\FM\22MYN1.SGM
22MYN1
]]>Agencies
[Federal Register Volume 77, Number 99 (Tuesday, May 22, 2012)]
[Notices]
[Pages 30266-30272]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-12420]
-----------------------------------------------------------------------
DEPARTMENT OF EDUCATION
Annual Updates to the Income Contingent Repayment (ICR) Plan
Formula for 2012; William D. Ford Federal Direct Loan Program
AGENCY: Federal Student Aid, Department of Education.
ACTION: Notice.
-----------------------------------------------------------------------
Catalog of Federal Domestic Assistance (CFDA) Number: 84.063.
SUMMARY: The Secretary announces the annual updates to the ICR plan
formula for 2012. Under the William D. Ford Federal Direct Loan (Direct
Loan) Program, borrowers may choose to repay their loans (Direct
Subsidized Loans, Direct Unsubsidized Loans, Direct PLUS Loans made to
graduate or professional students, and Direct Consolidation Loans)
under the ICR plan, which bases the repayment amount on the borrower's
income, family size, loan amount, and the interest rate applicable to
each loan. Each year, we adjust the formula for calculating a
borrower's ICR payment to reflect changes due to inflation. This notice
contains the adjusted income percentage factors for 2012, examples of
how the calculation of the monthly ICR amount is performed, a constant
multiplier chart for use in performing the calculations, and charts
showing sample repayment amounts based on the adjusted ICR plan
formula. The adjustments to the income percentage factors for the ICR
plan formula, contained in this notice, are effective for the period
from July 1, 2012 to June 30, 2013.
FOR FURTHER INFORMATION CONTACT: Ian Foss, U.S. Department of
Education, 830 First St. NE., Room 114I1, Washington, DC 20202.
Telephone: (202) 377-3681 or by email: ian.foss@ed.gov.
If you use a telecommunications device for the deaf (TDD) or a text
telephone (TTY), call the Federal Relay Service (FRS), toll free, at 1-
800-877-8339.
Individuals with disabilities can obtain this document in an
accessible format (e.g., braille, large print, audiotape, or compact
diskette) on request to the contact person listed under FOR FURTHER
INFORMATION CONTACT in this section of the notice.
SUPPLEMENTARY INFORMATION: Direct Loan Program borrowers may choose to
repay their Direct Subsidized Loans, Direct Unsubsidized Loans, Direct
PLUS Loans made to graduate or professional students, and Direct
Consolidation Loans under the ICR plan. This notice contains the
following four attachments:
Attachment 1--Income Percentage Factors for 2012
Attachment 2--Constant Multiplier Chart for Use in Calculating
the Monthly ICR Amount
Attachment 3--Examples of the Calculations of Monthly
Repayment Amounts
Attachment 4--Charts Showing Sample Repayment Amounts for
Single and Married Borrowers
In Attachment 1, we have updated the income percentage factors to
reflect changes based on inflation. Specifically, we have revised the
table of income percentage factors by changing the dollar amounts of
the incomes shown by a percentage equal to the estimated percentage
change in the Consumer Price Index for all urban consumers from
December 2011 to December 2012. In Attachment 2, we provide a constant
multiplier chart for a 12-year loan amortization. Further, in
Attachment 3, we provide examples of monthly repayment amount
calculations. Finally, in Attachment 4, we provide two charts that show
sample repayment amounts for single and married or head-of-household
borrowers at various income and debt levels based on the updated income
percentage factors.
The updated income percentage factors reflected in Attachment 1 may
cause a borrower's payments to be lower than they were in prior years
(even if the borrower's income remains the same as the prior year).
However, the revised repayment amount more accurately reflects the
impact of inflation on a borrower's current ability to repay.
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: 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:
www.federalregister.gov.
[[Page 30267]]
Specifically, through the advanced search feature at this site, you can
limit your search to documents published by the Department.
Program Authority: 20 U.S.C. 1087 et seq.
Dated: May 17, 2012.
James W. Runcie,
Chief Operating Officer, Federal Student Aid.
Attachment 1--Income Percentage Factors for 2012
Income Percentage Factors For 2012
[Based on annual income]
----------------------------------------------------------------------------------------------------------------
Single Married/head of household
----------------------------------------------------------------------------------------------------------------
Income % Factor Income % Factor
----------------------------------------------------------------------------------------------------------------
$10,470...................................... 55.00 $10,470......................... 50.52
14,406....................................... 57.79 16,520.......................... 56.68
18,537....................................... 60.57 19,687.......................... 59.56
22,761....................................... 66.23 25,737.......................... 67.79
26,797....................................... 71.89 31,884.......................... 75.22
31,884....................................... 80.33 40,048.......................... 87.61
40,048....................................... 88.77 50,225.......................... 100.00
50,226....................................... 100.00 60,409.......................... 100.00
60,409....................................... 100.00 75,682.......................... 109.40
72,603....................................... 111.80 101,129......................... 125.00
92,966....................................... 123.50 136,758......................... 140.60
131,671...................................... 141.20 191,263......................... 150.00
150,973...................................... 150.00 312,539......................... 200.00
268,909...................................... 200.00 ................................ ..............
----------------------------------------------------------------------------------------------------------------
Attachment 2--Constant Multiplier Chart for use in Calculating the
Monthly ICR Amount
Constant Multiplier Chart For 12-Year Amortization
------------------------------------------------------------------------
Annual
Interest rate (%) constant
multiplier
------------------------------------------------------------------------
3.500................................................... 0.102174
4.000................................................... 0.105063
4.500................................................... 0.108001
5.000................................................... 0.110987
5.500................................................... 0.114021
6.000................................................... 0.117102
6.800................................................... 0.122130
7.000................................................... 0.123406
7.900................................................... 0.129237
8.000................................................... 0.129894
8.250................................................... 0.131545
------------------------------------------------------------------------
Attachment 3--Examples of the Calculations of Monthly Repayment Amounts
General notes about the examples in this attachment:
The interest rates used in the examples are for
illustration only. Actual interest rates vary depending on loan type
and when a loan was first disbursed.
In the examples, the Poverty Guideline amounts used are
from the 2012 U.S. Department of Health and Human Services (HHS)
Poverty Guidelines for the 48 contiguous States and the District of
Columbia, as published in the Federal Register on January 26, 2012 (77
FR 4034). Different Poverty Guidelines apply to residents of Alaska and
Hawaii.
The ``constant multiplier'' included in each example is a
factor used to calculate amortized payments at a given interest rate
over a fixed period of time. Refer to the constant multiplier chart
provided in Attachment 2 to this notice to determine the constant
multiplier that should be used for a specific interest rate. If an
interest rate is not listed in the constant multiplier chart in
Attachment 2, use the next highest rate for estimation purposes.
All examples use an income percentage factor corresponding
to the borrower's adjusted gross income (AGI). If the AGI is not listed
in the income percentage factors table in Attachment 1, calculate the
applicable income percentage factor for the AGI by following the
instructions under the Interpolation heading later in this attachment.
For married borrowers, the outstanding balance on the
loans of each borrower and both borrowers' AGIs are added together to
determine the ICR payment amount. The amount of each payment applied to
each borrower's Direct Loan debt is the proportion of the payments that
equals the same proportion as that borrower's debt to the total
outstanding balance. Each borrower is billed separately. For example,
if a married couple has a total outstanding Direct Loan debt of
$60,000, $40,000 of which belongs to one spouse, and $20,000 of which
belongs to the other spouse, 67 percent of the monthly ICR payment
would be apportioned to the spouse with the outstanding debt of
$40,000, with the remaining 33 percent of the monthly ICR payment being
apportioned to the spouse with $20,000 of debt. To take advantage of a
joint ICR payment, married couples need not file taxes jointly; they
may file separately and subsequently provide the other spouse's tax
information.
Example 1. This example assumes that the borrower is single with
no dependents, and has $15,000 in Direct Subsidized and Unsubsidized
Loans. The interest rate on these loans is 6.80 percent, and the
borrower has an AGI of $40,048.
Step 1: Determine the total annual payment amount based on what the
borrower would pay over 12 years using standard amortization. To do
this, multiply the loan balance by the constant multiplier for the
applicable interest rate. In this example, the interest rate is 6.80
percent, for which the constant multiplier is 0.122130.
0.122130 x $15,000 = $1,831.95
Step 2: Multiply the result of Step 1 by the income percentage
factor shown in the income percentage factors table (see Attachment 1
to this notice) that corresponds to the AGI and then divide the result
by 100:
88.77 x $1,831.95 / 100 = $1,626.22
Step 3: Determine 20 percent of the borrower's discretionary income
(discretionary income is AGI minus the U.S. Department of Health and
Human Services (HHS) Poverty Guideline amount for the borrower's family
size
[[Page 30268]]
and state of residence). To do this, subtract the Poverty Guideline
amount for a family of one, for this example, from the borrower's AGI
and multiply the result by 20 percent:
$40,048-$11,170 = $28,878
$28,878 x 0.20 = $5,775.60
Step 4: Compare the amount from Step 2 with the amount from Step 3.
The lower of the two will be the annual payment amount. In this
example, the borrower will be paying the amount calculated under Step 2
($1,626.22). To determine the monthly repayment amount, divide the
annual amount by 12.
$1,626.22 / 12 = $135.52
Example 2. In this example, the borrower is married and has no
dependents, other than a spouse. The borrower has a Direct Loan
balance of $10,000, and the spouse has a Direct Loan balance of
$15,000. The interest rate on all of the loans is 6.80 percent.
The borrower and spouse have a combined AGI of $75,682 and are
repaying their loans jointly under the ICR plan (for general
information regarding joint ICR payments for married couples, see
the fifth bullet under the heading entitled ``General notes about
the examples'' in this attachment).
Step 1: Add the borrower's and the borrower's spouse's Direct Loan
balances together to determine their combined aggregate loan balance:
$10,000 + $15,000 = $25,000
Step 2: Determine the combined total annual payment amount for
these borrowers based on what both borrowers would pay over 12 years
using standard amortization. To do this, multiply the combined loan
balance by the constant multiplier for the applicable interest rate. In
this example, the interest rate is 6.80 percent, for which the constant
multiplier is 0.122130.
0.122130 x $25,000 = $3,053.25
Step 3: Multiply the result of Step 2 by the income percentage
factor shown in the income percentage factors table in Attachment 1
that corresponds to the borrower's and the borrower's spouse's combined
AGI and then divide the result by 100:
109.40 x $3,053.25 / 100 = $3,340.26
Step 4: Determine 20 percent of discretionary income. To do this,
subtract the Poverty Guideline amount for a family of two, in this
example, from the combined AGI and multiply the result by 20 percent:
$75,682 - $15,130 = $60,552
$60,552 x 0.20 = $12,110.40
Step 5: Compare the amount from Step 3 with the amount from Step 4.
The lower of the two will be the annual payment amount for the borrower
and the borrower's spouse. The borrower and the borrower's spouse will
jointly pay the amount calculated under Step 3 ($3,340.26). To
determine the monthly repayment amount, divide the annual amount by 12.
$3,340.26 / 12 = $278.36
Example 3. This example assumes that the borrower is single with
no dependents and has $15,000 in Direct Subsidized and Unsubsidized
Loans. The interest rate on all of the loans is 6.80 percent, and
the borrower's AGI is $31,884.
Step 1: Determine the total annual payment amount based on what the
borrower would pay over 12 years using standard amortization. To do
this, multiply the loan balance by the constant multiplier for the
applicable interest rate. In this example, the interest rate is 6.80
percent, for which the constant multiplier is 0.122130.
0.122130 x $15,000 = $1,831.95
Step 2: Multiply the result of Step 1 by the income percentage
factor shown in the income percentage factors table in Attachment 1
that corresponds to the borrower's income and then divide the result by
100:
80.33 x $1,831.95 / 100 = $1,471.61
Step 3: Determine 20 percent of discretionary income (discretionary
income is the borrower's AGI minus the HHS Poverty Guideline amount for
the borrower's family size). To do this, subtract the Poverty Guideline
amount for a family of one, in this example, from AGI and multiply the
result by 20 percent:
$31,884 - $11,170 = $20,714
$20,714 x 0.20 = $4,142.80
Step 4: Compare the amount from Step 2 with the amount from Step 3.
The lower of the two will be the annual payment amount. In this
example, the borrower will be paying the amount calculated under Step 2
($1,471.61). To determine the monthly repayment amount, divide the
annual amount by 12.
$1,471.61 / 12 = $122.63
Example 4. In this example, the borrower is married and has no
dependents, other than the spouse. The borrower and spouse have a
combined AGI of $40,048 and are repaying their loans under the ICR
plan (for general information regarding joint ICR payments for
married couples, see the fifth bullet under the heading entitled
``General notes about the examples'' in this attachment). The
borrower has a Direct Loan balance of $10,000, $5,000 of which is at
an interest rate of 6.80 percent and $5,000 of which is at an
interest rate of 7.0 percent. The spouse has a Direct Loan balance
of $15,000, $5,000 of which is at an interest rate of 6.80 percent
and $10,000 of which is at an interest rate of 7.0 percent.
Step 1: Add the borrower's and the borrower's spouse's Direct Loan
balances that have the same interest rate together to determine
combined aggregate loan balances by interest rate:
6.8 percent: $5,000 + $5,000 = $10,000
7.0 percent: $5,000 + $10,000 = $15,000
Step 2: Determine the annual payment based on what would be paid
over 12 years using standard amortization for each interest rate-based
group of combined aggregate loan balances. To do this, multiply each
group of combined aggregate loan balances by the constant multiplier
for the applicable interest rate. For 6.80 percent, the constant
multiplier is 0.122130. For 7.0 percent, the constant multiplier is
0.123406.
0.122130 x $10,000 = $1,221.30
0.123406 x $15,000 = $1,851.09
Step 3: Add the products of Step 2 together, multiply that total by
the income percentage factor shown in the income percentage factors
table in Attachment 1 that corresponds to the borrower's and the
borrower's spouse's combined AGI, and then divide the result by 100:
$1,221.30 + $1,851.09 = $3,072.39
87.61 x $3,072.39 / 100 = $2,691.72
Step 4: Determine 20 percent of discretionary income. To do this,
subtract the Poverty Guideline amount for a family of two, in this
example, from the combined AGI and multiply the result by 20 percent:
$40,048--$15,130 = $24,918
$24,918 x 0.20 = $4,983.60
Step 5: Compare the amount from Step 3 with the amount from Step 4.
The lower of the two will be the annual payment amount. In this
example, the borrower and the borrower's spouse will jointly pay the
amount calculated under Step 3 ($2,691.72). To determine the monthly
repayment amount, divide the annual amount by 12.
$2,691.72 / 12 = $224.31
Interpolation. If the borrower's income is not included on the
income percentage factor table, calculate the income percentage factor
through interpolation. For example, assume that the borrower is single
with an income of $30,000.
Step 1: Find the closest income listed that is less than $30,000
and the closest income listed that is greater than $30,000.
Step 2: Subtract the lower amount from the higher amount (for this
discussion, we will call the result the ``income interval''):
$31,884 - $26,797 = $5,087
[[Page 30269]]
Step 3: Determine the difference between the two income percentage
factors that correspond to the incomes used in Step 2 (for this
discussion, we will call the result the ``income percentage factor
interval''):
80.33 percent - 71.89 percent = 8.44 percent
Step 4: Subtract from the borrower's income the closest income
shown on the chart that is less than the borrower's income of $30,000:
$30,000 - $26,797 = $3,203
Step 5: Divide the result of Step 4 by the income interval
determined in Step 2:
$3,203 / $5,087 = 0.6296
Step 6: Multiply the result of Step 5 by the income percentage
factor interval:
8.44 percent x 0.6296 = 5.314 percent
Step 7: Add the result of Step 6 to the lower of the two income
percentage factors used in Step 3 to calculate the income percentage
factor interval for $30,000 in income:
5.314 percent + 71.89 percent = 77.20 percent (rounded to the
nearest hundredth)
The result is the income percentage factor that will be used to
calculate the monthly repayment amount under the ICR plan.
BILLING CODE 4000-01-C
[[Page 30270]]
[GRAPHIC] [TIFF OMITTED] TP22MY12.000
[[Page 30271]]
[GRAPHIC] [TIFF OMITTED] TP22MY12.001
[FR Doc. 2012-12420 Filed 5-21-12; 8:45 am]
BILLING CODE 4000-01-C
