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Federal Perkins Loan Program rule (2021)

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The Federal Perkins Loan Program, Federal Work-Study Programs, Federal Supplemental Educational Opportunity Grant Program, Federal Family Education Loan Program, William D. Ford Federal Direct Loan Program, National Direct Student Loan Program, Teacher Education Assistance for College and Higher Education Grant Program, Federal Pell Grant Program, Leveraging Educational Assistance Partnership Program, and Gaining Early Awareness and Readiness for Undergraduate Programs rule is a significant rule issued by the U.S. Department of Education effective July 1, 2021, that amended department regulations regarding eligibility of faith-based entities in Federal Student Aid programs under the Higher Education Act.[1]

HIGHLIGHTS
  • Name: Federal Perkins Loan Program, Federal Work-Study Programs, Federal Supplemental Educational Opportunity Grant Program, Federal Family Education Loan Program, William D. Ford Federal Direct Loan Program, National Direct Student Loan Program, Teacher Education Assistance for College and Higher Education Grant Program, Federal Pell Grant Program, Leveraging Educational Assistance Partnership Program, and Gaining Early Awareness and Readiness for Undergraduate Programs
  • Code of Federal Regulations: 34 CFR Parts 600, 674, 675, 676, 682, 685, 686, 690, 692, and 694
  • Agency: Office of Postsecondary Education, Department of Education
  • Type of significant rule: Economically significant rule

    • Timeline

    The following timeline details key rulemaking activity:

    • July 8, 2021: The Department of Education, under the Biden administration, announced the implementation of certain sections of the TEACH Grant program regulations.[2]
    • July 1, 2021: The final rule took effect.[1]
    • August 14, 2020: The Department of Education published a final rule.[1]
    • January 10, 2020: The Department of Education closed the comment period.[3]
    • December 11, 2019: The Department of Education published a notice of proposed rulemaking and opened the comment period.[3]
    • May 4, 2017: President Donald Trump (R) issued an executive order to direct executive agencies on implementing policies with implications for the religious liberty of individuals and organizations.[4]

    Background

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    President Lyndon Johnson (D) signed the Higher Education Act (HEA) into law on November 8, 1965, in an effort to strengthen educational resources and financial assistance for college students by increasing federal grants to universities, creating low-interest student loans, and issuing scholarships. Title IV of the HEA established standards for offering financial assistance to college students, which governed Federal Student Aid programs including the Federal Perkins Loan Program, Federal Work Study Programs, Federal Supplemental Educational Opportunity Grant Program, Federal Family Education Loan Program, William D. Ford Federal Direct Loan Program, National Direct Student Loan Program, Teacher Education Assistance for College and Higher Education Grant Program, Federal Pell Grant Program, Leveraging Educational Assistance Partnership Program, and Gaining Early Awareness and Readiness for Undergraduate Programs.[5]

    President Donald Trump (R) issued Executive Order 13798, "Promoting Free Speech and Religious Liberty," on May 4, 2017, which directed executive agencies on implementing policies with implications for the religious liberty of individuals and organizations. Following the order, the U.S. Supreme Court ruled on June 26, 2017, in Trinity Lutheran Church v. Comer that the First Amendment right to free expression of religion protects organizations from being denied federal assistance on the basis of religious status.[4][3]

    In response to the executive order and Supreme Court ruling, the Department of Education reviewed regulations under the HEA "to ensure that students and faith-based entities are not discriminated against due to their religious beliefs," according to the proposed rule. The department proposed amendments on December 11, 2019, to align the federal student aid program regulations with the stated goals of the executive order and the Supreme Court ruling.[3]

    Summary of the rule

    The following is a summary of the rule from the rule's entry in the Federal Register:

    “ In response to the United States Supreme Court decision in Trinity Lutheran Church of Columbia, Inc. v. Comer (Trinity Lutheran), and the United States Attorney General's October 7, 2017 Memorandum on Federal Law Protections for Religious Liberty pursuant to Executive Order No. 13798 (Attorney General's memorandum), the Department of Education (Department or we) amends the current regulations regarding the eligibility of faith-based entities to participate in the Federal Student Aid programs authorized under title IV of the Higher Education Act of 1965, as amended (HEA), and the eligibility of students to obtain certain benefits under those programs. The Department also amends the Teacher Education Assistance for College and Higher Education (TEACH) Grant Program regulations to minimize the number of TEACH Grants that are converted to Federal Direct Unsubsidized Loans, and to update, strengthen, and clarify other areas of the TEACH Grant Program regulations.[1][6] ”

    Summary of provisions

    The following is a summary of the provisions from the rule's entry in the Federal Register:[3]

    “ To restore religious liberty to faith-based institutions and religious students, these regulations—
    • Restore the ability of members of religious orders, who also are pursuing courses of study at institutions of higher education, to participate in the title IV programs by eliminating regulatory provisions that treat members of religious orders as having no financial need in certain circumstances.
    • Allow certain borrowers, who serve as full-time volunteers in tax-exempt organizations and give religious instruction, conduct worship service, proselytize, or fundraise to support religious activities as part of their official duties, to defer repayment of Federal Perkins Loans, National Direct Student Loans (NDSLs), and Federal Family Education Loan Program (FFEL) loans.
    • Provide an interpretation of the PSLF regulations that permits borrowers who work for employers that engage in religious instruction, worship services, or proselytizing to qualify for PSLF.
    • Clarify requirements for private secondary and postsecondary faith-based institutions' participation in the GEAR UP program.
    • Conform language in the Leveraging Educational Assistance Partnership Program (LEAP) and Federal Work-Study Programs (FWSP) regulations regarding allowable program activities to statutory language.

    For the TEACH Grant Program, the regulations—

    • Clarify that grant recipients may satisfy the TEACH Grant service obligation by teaching for an educational service agency that serves low-income students.
    • Clarify the beginning date of the eight-year period for completing the TEACH Grant service obligation.
    • Revise the definition of “highly qualified.”
    • Update and expand the conditions under which a TEACH Grant recipient may satisfy the TEACH Grant service obligation by teaching in a high-need field listed in the Department's annual Teacher Shortage Area Nationwide Listing (Nationwide List) at https://tsa.ed.gov.
    • Clarify the service obligation requirements for TEACH Grant recipients who withdraw from the institution where they received a TEACH Grant before completing the program for which they received the grant, then later re-enroll in the same program or in a different TEACH Grant eligible program at the same academic level.
    • Provide that a TEACH Grant recipient may request reversal of a voluntary grant-to-loan conversion so that the recipient can complete the service obligation, as long as the service obligation is completed within eight years from when the grant recipient ceased enrollment at the institution where the recipient received the grant or, in the case of a student who received a TEACH Grant at one institution and subsequently transferred to another institution and enrolled in another TEACH Grant-eligible program, within eight years of ceasing enrollment at the other institution, excluding periods of suspension, which the recipient could apply for retroactively.
    • Expand the information that is provided to TEACH Grant recipients during initial, subsequent, and exit counseling, and add a new conversion counseling requirement for grant recipients whose TEACH Grants are converted to Direct Unsubsidized Loans.
    • Provide counseling requirements for TEACH Grant recipients who receive reversals of voluntary grant-to-loan conversions.
    • Add new conditions under which a TEACH Grant recipient may receive a temporary suspension of the eight-year period for completing the service obligation and for grant recipients whose grants were converted to loans in error and who need additional time to complete the teaching service obligation once the error is corrected.
    • Remove the current regulatory requirement for TEACH Grant recipients to certify, within 120 days of completing the program for which they received TEACH Grants, that they have begun qualifying teaching service, or that they have not yet begun teaching, but they intend to satisfy the service obligation.
    • Simplify the regulations specifying the conditions under which TEACH Grants are converted to Direct Unsubsidized Loans so that for all grant recipients, loan conversion will occur only if the recipient asks the Secretary to convert his or her TEACH Grants to loans, or if the recipient fails to begin or maintain qualifying teaching service within a timeframe that would allow the recipient to satisfy the service obligation within the eight-year service obligation period.
    • Specify that the Secretary will send grant recipients, at least annually, a notice containing detailed information about the TEACH Grant service obligation requirements, a summary of the grant recipient's progress toward satisfying the service obligation, and an explanation of the process by which a grant recipient whose TEACH Grants are converted to Direct Unsubsidized Loans may request reconsideration of the conversion if he or she believes that the grants were converted in error.
    • Provide that grant recipients will be automatically provided with a “statement of error” when a grant that was incorrectly converted to a loan is later reconverted to a TEACH Grant.
    • Describe the actions that the Secretary will take if a grant recipient's request for reconsideration of the conversion of the grant to a loan is approved or denied.
    • Specify that the Secretary will notify a grant recipient in advance of the date by which he or she will be subject to loan conversion for failure to begin or maintain qualifying teaching service within a timeframe that would allow the recipient to complete the service obligation within the eight-year service obligation period, and inform the recipient of the final date by which he or she must provide documentation of teaching service to avoid having his or her grants converted to loans.
    • Incorporate statutory changes and update, simplify, and clarify various areas of the TEACH Grant Program regulations.[6]
    		 ”

    Significant impact

    See also: Significant regulatory action

    The Office of Management and Budget (OMB) deemed this rule economically significant pursuant to Executive Order 12866. An agency rule can be deemed a significant rule if it has had or might have a large impact on the economy, environment, public health, or state or local governments. The term was defined by E.O. 12866, which was issued in 1993 by President Bill Clinton.[1]

    Text of the rule

    The full text of the rule is available below:[1]

    See also

    External links

    Footnotes

    1. ↑ 1.0 1.1 1.2 1.3 1.4 1.5 Federal Register, "Federal Perkins Loan Program, Federal Work-Study Programs, Federal Supplemental Educational Opportunity Grant Program, Federal Family Education Loan Program, William D. Ford Federal Direct Loan Program, National Direct Student Loan Program, Teacher Education Assistance for College and Higher Education Grant Program, Federal Pell Grant Program, Leveraging Educational Assistance Partnership Program, and Gaining Early Awareness and Readiness for Undergraduate Programs," August 14, 2020
    2. ↑ Federal Register, "Teacher Education Assistance for College and Higher Education (TEACH) Grant Program," July 8, 2021
    3. ↑ 3.0 3.1 3.2 3.3 3.4 Federal Register, "Federal Perkins Loan Program, Federal Work-Study Programs, Federal Supplemental Educational Opportunity Grant Program, Federal Family Education Loan Program, William D. Ford Federal Direct Loan Program, Teacher Education Assistance for College and Higher Education Grant Program, Federal Pell Grant Program, Leveraging Educational Assistance Partnership Program, and Gaining Early Awareness and Readiness for Undergraduate Programs," December 11, 2019
    4. ↑ 4.0 4.1 Federal Register, "Promoting Free Speech and Religious Liberty," May 9, 2017
    5. ↑ Federal Student Aid, "Gainful Employment Information," accessed May 2, 2023
    6. ↑ 6.0 6.1 Note: This text is quoted verbatim from the original source. Any inconsistencies are attributable to the original source.
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