[Congressional Record Volume 149, Number 2 (Wednesday, January 8, 2003)]
[Extensions of Remarks]
[Pages E15-E16]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




INTRODUCTION OF THE FED UP HIGHER EDUCATION TECHNICAL AMENDMENTS ACT OF 
                                  2003

                                 ______
                                 

                     HON. HOWARD P. ``BUCK'' McKEON

                             of california

                    in the house of representatives

                        Tuesday, January 7, 2003

  Mr. McKEON. Mr. Speaker, today, I am proud to join my colleague, the 
Chairman of the House Education and the Workforce Committee, John 
Boehner, in introducing the FED UP Higher Education Technical 
Amendments Act of 2003. This legislation is the result of a great deal 
of effort to improve the efficiencies and effectiveness of the Title IV 
student aid programs through the review of overly burdensome and 
outdated regulations.
  During the 107th Congress, 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 
(HEA) 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, and have since published 
final regulations implementing many of the FED UP proposals.
  These proposed amendments to the Higher Education Act of 1965 
continue this effort to

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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 larger, 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 reinstates two 
provisions beneficial to both students and institutions that expired on 
September 30, 2002. Specifically, schools with default rates under 10 
percent for three consecutive fiscal years will be permitted to waive a 
30-day delay requirement for first-year, first-time borrowers. Schools 
meeting the same low default rate standard would also be permitted to 
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 timelier basis.
  The FED UP Higher Education Technical Amendments Act of 2003 also 
corrects an error in an overly broad implementation of a provision 
affecting a student's eligibility for Title IV financial aid once 
convicted of a federal drug offense. Only those students enrolled and 
receiving Title IV aid when convicted will be affected once this 
correction is implemented.
  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 (LEAP) 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.
  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.
  The FED UP Higher Education Technical Amendments Act of 2003 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.
  The FED UP Higher Education Technical Amendments Act of 2003 will 
take us one step closer to reducing burdensome rules and allow 
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.
  This legislation also brings forward, as an addition to FED UP, the 
provisions passed by the House of Representatives in the previous 
Congress that deal with the forgiveness of student loans for spouses of 
victims of the tragedy of September 11th and provides for the 
additional innovation of the delivery of postsecondary education by 
eliminating the rule prohibiting institutions of higher education from 
offering more than 50 percent of their coursework through distance 
education. This provision provides for a controlled look at increasing 
the availability of distance education, while protecting the integrity 
of the student aid programs.
  We will be beginning the reauthorization of the Higher Education Act 
with this Congress and this is a very positive, productive and 
efficient first step. FED UP 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.

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