[Congressional Record Volume 148, Number 73 (Thursday, June 6, 2002)]
[Extensions of Remarks]
[Pages E972-E973]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




INTRODUCTION OF THE FED UP HIGHER EDUCATION TECHNICAL AMENDMENTS ACT OF 
                                  2002

                                 ______
                                 

                     HON. HOWARD P. ``BUCK'' McKEON

                             of california

                    in the house of representatives

                        Wednesday, June 5, 2002

  Mr. McKEON. Mr. Speaker, today I am proud to join several of my 
colleagues in introducing the FED UP Higher Education Amendments Act of 
2002. This legislation is the result of a year-long endeavor to improve 
the efficiencies and effectiveness of the Title IV student aid programs 
through the review of overly burdensome and outdated regulations.
  Last year, the House Education and the Workforce Committee launched 
the FED.UP project (short for ``Upping the Effectiveness of our Federal 
Student Aid Programs) to identify and simplify burdensome regulations 
in the Higher Education Act of 1965 that work against college students 
and personnel. The initiative, which was started to bring some sense to 
the regulations that students and the higher education community must 
deal with on a daily basis, received over 3,000 responses from college 
officials, administrators and other personnel who operate America's 
institutions of higher learning. After all of the responses were 
catalogued, the Department of Education initiated a negotiated 
rulemaking process to consider the regulatory changes included in the 
project.
  These proposed amendments to the Higher Education Act of 1965 
continue this effort to identify and simplify burdensome regulations 
that work against college students and personnel, and are non-
controversial and technical in nature. They provide for improvements 
that will reduce red tape for colleges and universities and will 
improve the financial aid process for students. Enacting these changes 
now will allow the House Education and Workforce Committee to address 
large, more intricate proposals during the reauthorization of the HEA 
without being bogged down with technical and clerical issues.
  This legislation provides for the streamlining and increased 
effectiveness of many provisions within the HEA. It extends two 
provisions beneficial to both students and institutions scheduled to 
expire on September 30, 2002. Currently, schools with default rates 
under 10 percent for three consecutive fiscal years may waive a 30-day 
delay requirement for first-year, first-time borrowers. Schools meeting 
the same low default rate standard may also request one term loans in a 
single disbursement, rather than the required multiple disbursements. 
These provisions act as an incentive to schools to keep their default 
rates low and assist students in getting access to their loan funds on 
a more timely basis.
  A drafting error during the 1998 reauthorization of the HEA 
inadvertently removed the eligibility of not-for-profit foreign 
veterinary schools from participation in the Federal Family Education 
Loan (FFEL) Program. This legislation will correct that error and keep 
hundreds of students from losing their loan eligibility.
  This legislation also provides clarification for financial aid 
officers in the return of Title IV funds. It clarifies how the return 
of Title IV funds should be implemented for schools utilizing clock 
hours, and what percentage of funds need to be included in any return. 
The language also makes clear that Leveraging Educational Assistance 
Partnership funds may be removed from the return of Title IV funds 
formula due to the mix of State and Federal funds at the school level. 
It clarifies that students who have been home schooled, and are treated 
as such under State law, are eligible for admittance into an 
institution of higher education as defined in the HEA and are eligible 
to receive financial aid. It also allows aid professionals to use 
professional judgment in determining financial need for a student who 
is declared a ward of the court.
  This bill allows for the use of technology wherever possible to 
enhance and improve communication and the transfer of information. This 
includes reporting by States in providing information on teacher 
quality and providing students with voter registration materials.

[[Page E973]]

  This legislation allows student loan borrowers to receive more timely 
assistance from their lenders when they are seeking forbearance of loan 
payments. It allows a lender to accept a request for assistance over 
the telephone as long as a confirmation notice of the agreement reached 
is provided to the borrower and the borrower's file is updated. This 
eliminates the need for borrowers to sign paper documents requesting 
help and agreeing in writing to what they already have agreed to 
verbally. This language also aligns a rehabilitation provision within 
the Perkins Loan Program with the Federal Family Education Loan 
Program.
  The FED UP Technical Amendments Act corrects an administrative issue 
in the payment of insurance to lenders and reinsurance to guaranty 
agencies on borrower default claims when the borrower failed to 
establish eligibility for that loan. This change reinstates long-
standing policy of the Department of Education in the payment of these 
specific claims, which was altered by a new reporting process put in 
place via a forms change.
  This legislation allows Hispanic Serving Institutions (HSIs) to apply 
for HSI grants without having to wait two years in between 
applications. It also clarifies allowable uses of grant funds within 
the Thurgood Marshall Legal Educational Opportunity Program. It also 
provides clarification within the Federal TRIO programs that 
institutions with more than one campus may apply for separate grants to 
serve different populations at different campuses.
  This legislation also provides clarification as to what items must be 
included within the annual report of the Department of Education's 
Performance Based Organization (PBO). Finally, the bill corrects the 
names of the authorizing committees throughout the HEA and corrects a 
citation to a section of the law that had been changed several years 
ago.
  The FED UP Higher Education Technical Amendments Act of 2002 will 
take us one step closer to reducing burdensome rules and allowing 
financial aid administrators and others in the higher education 
community to do their jobs more efficiently and effectively. Program 
integrity and service to students remain the priority and this 
legislation accomplishes both.
  FEDUP has accomplished its goal of streamlining the current 
regulatory system to the extent possible, while maintaining or 
improving program integrity and I urge my colleagues to support this 
legislation.

                          ____________________