[Federal Register Volume 59, Number 81 (Thursday, April 28, 1994)]
[Unknown Section]
[Page ]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-9747]
[Federal Register: April 28, 1994]
_______________________________________________________________________
Part IV
Department of Education
_______________________________________________________________________
34 CFR Part 668
Student Assistance General Provisions; Final Rule
DEPARTMENT OF EDUCATION
34 CFR Part 668
RIN 1840-AC08
Student Assistance General Provisions
Agency: Department of Education.
Action: Final regulations.
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Summary: The Secretary amends subpart E of the Student Assistance
General Provisions regulations, 34 CFR part 668, Verification of
Student Aid Application Information, to implement technical revisions
resulting from the Higher Education Amendments of 1992 (Pub. L. 102-
325) and the Higher Education Technical Amendments of 1993 (Pub. L.
103-208) and to reduce the administrative burden associated with
verification requirements on applicants and institutions. These
regulations require institutions to have a system for verifying student
aid application information reported by applicants for use in
calculating expected family contributions (EFCs) for the Federal Pell
Grant, campus-based (Federal Perkins Loan, Federal Work-Study (FWS),
and Federal Supplemental Educational Opportunity Grant (FSEOG)),
Federal Stafford Loan, Federal Direct Student Loan (FDSL), and
Presidential Access Scholarship (PAS) programs.
Effective Date: These regulations take effect on July 1, 1994. When
these regulations become effective, they will govern verification of
student aid application information for any Title IV, Higher Education
Amendments (HEA) program assistance that may be awarded to any student
for award years beginning with 1994-95.
FOR FURTHER INFORMATION CONTACT: Lorraine Kennedy, U.S. Department of
Education, 400 Maryland Avenue, SW., Regional Office Building 3, room
4318, Washington, DC 20202-5451. Telephone (202) 708-4601. Individuals
who use a telecommunications device for the deaf (TDD) may call the
Federal Information Relay Service (FIRS) at 1-800-877-8339 between 8
a.m. and 8 p.m., Eastern time, Monday through Friday.
SUPPLEMENTARY INFORMATION: Subpart E of the Student Assistance General
Provisions regulations (34 CFR part 668) governs the verification of
the information that is used to calculate an applicant's expected
family contribution (EFC) as part of the determination of an
applicant's need for student financial assistance. Based on the need
analysis formula established in statute, the EFC is the amount that an
applicant and the applicant's family can reasonably be expected to
contribute towards the applicant's cost of attendance at an institution
of higher education.
The changes in these regulations result from a review of current
policies and procedures and from recently enacted legislation that
renders certain provisions in the current regulations obsolete.
Summary of Changes
Sections 668.51 through 668.61 are amended to delete all references
to the Income Contingent Loan (ICL) Program and Quality Control Pilot
Project. Program references throughout Subpart E have been changed to
reflect the new names of the Title IV, HEA programs.
Sections 668.52(b) and 668.54(a) are amended to delete the
definition of Need Analysis Servicer, to delete references to the
certification of need analysis servicers, and to delete references to
the 30 percent verification limitation.
Sections 668.54 through 668.56 are amended to include the use of an
output document and institutional student information reports (ISIRs)
in conjunction with the reference to the Student Aid Report (SAR).
Output documents and ISIRs will also be used in conjunction with the
reference to an SAR for applicants selected for verification under
Sec. 668.54(a)(2).
Sections 668.56(a)(5)(i) (A) and (B) and 668.57(d)(2)(i) are
deleted since the Department no longer participates in a match with the
Social Security Administration for these benefits.
The Secretary also amends Sec. 668.57(a) (2) and (3) to remove the
quotation marks before and after ``IRS Listing of Tax Account
Information'' and to make the phrase lower case. This clarifies that
the reference is to information that is being requested from IRS that
would be used to verify specific data elements, not a specific IRS
form. Also, this would accommodate new IRS forms that are continuously
being developed through electronic technology to assist tax filers.
Section 668.59 is amended to remove all references to the Pell
Grant Index (PGI) and replace the reference with EFC, and to add the
new terms output document or ISIRs as they apply. This section is also
being amended to delete the Zero PGI Charts.
The regulations also delete the use of the Zero PGI Charts as a
tolerance option for applicants who have undergone verification. In the
past, the charts have not been widely used and institutions can easily
use another tolerance option such as the recalculation of an
applicant's EFC. The Department of Education provides the Electronic
Needs Analysis System (ENAS) to institutions at no cost. ENAS may be
used for recalculating an applicant's EFC.
Waiver of Proposed Rulemaking
In accordance with section 431(b)(2)(A) of the General Education
Provisions Act (20 U.S.C. 1232(b)(2)(A)) and the Administrative
Procedure Act (5 U.S.C. 553), it is the practice of the Secretary to
offer interested parties the opportunity to comment on proposed
regulations. However, the technical changes in these final regulations
are a direct result of the Higher Education Amendments of 1992, are
purely technical, and do not establish substantive policy. Therefore,
the Secretary has determined under 5 U.S.C. 553(b)(B) that proposed
rulemaking is unnecessary and contrary to the public interest.
Assessment of Educational Impact
The Department has determined that the regulations in this document
do not require transmission of information that is being gathered by or
is available from any other agency or authority of the United States.
List of Subjects in 34 CFR Part 668
Administrative practice and procedure, Colleges and universities,
Consumer protection, Education, Grant programs--education, Loan
programs--education, Reporting and recordkeeping requirements, Student
aid.
Dated: April 19, 1994.
Richard W. Riley,
Secretary of Education.
(Catalog of Federal Domestic Assistance Numbers: Federal
Supplemental Educational Opportunity Grant Program, 84.007; Federal
Stafford Loan Program, 84.032; Federal PLUS Loan Program, 84.032;
Federal Work-Study Program, 84.033; Federal Perkins Loan Program,
84.038; Federal Pell Grant Program, 84.063; Presidential Access
Scholarship and Partnership Program, No number assigned; Federal
Direct Student Loan Program, 84.268)
The Secretary amends Part 668 of Title 34 of the Code of Federal
Regulations as follows:
PART 668--STUDENT ASSISTANCE GENERAL PROVISIONS
1. The authority citation for part 668 continues to read as
follows:
Authority: 20 U.S.C. 1085, 1088, 1091, 1092, 1094, and 1141,
unless otherwise noted.
2. Section 668.51 is amended by removing paragraph (c),
redesignating paragraph (d) as paragraph (c), and revising paragraph
(a) and redesignated paragraph (c) to read as follows:
Sec. 668.51 General.
(a) Scope and purpose. The regulations in this subpart govern the
verification by institutions of information submitted by applicants for
student financial assistance in connection with the calculation of
their expected family contributions (EFC) for the Federal Pell Grant,
campus-based, Federal Stafford Loan, Federal Direct Student Loan
(FDSL), and Presidential Access Scholarship (PAS) programs.
* * * * *
(c) Foreign schools. The Secretary exempts from the provisions of
this subpart institutions participating in the Federal Stafford Loan
Program that are not located in a State.
3. Section 668.52 is amended by deleting the definition of ``Need
analysis servicer,'' by adding, in alphabetical order, the definition
of ``Institutional student information report,'' and by revising the
definition of ``Student aid application'' to read as follows:
Sec. 668.52 Definitions.
* * * * *
Institutional student information report as defined in 34 CFR 690.2
for purposes of the Federal Pell Grant, campus-based, Federal Stafford
Loan and PAS programs.
* * * * *
Student aid application means an application approved by the
Secretary and submitted by a person to have his or her EFC determined
under the Federal Pell Grant, campus-based, Federal Stafford Loan,
Federal Direct Loan or PAS programs.
4. Section 668.54 is amended by revising paragraph (a)(2), removing
paragraph (a)(3), by redesignating paragraphs (a)(4) through (a)(6) as
paragraphs (a)(3) through (a)(5) respectively, and by revising
paragraph (b)(2)(vii)(B) to read as follows:
Sec. 668.54 Selection of applications for verification.
(a) * * *
(2) An institution shall require each applicant whose application
is selected for verification, on the basis of edits specified by the
Secretary, to verify all of the applicable items specified in
Sec. 668.56.
* * * * *
(b) * * *
(2) * * *
(vii) * * *
(B) A copy of the verified application and, if the applicant
applied for a Federal Pell Grant, pages 1 and 3 of the applicant's SAR
or a copy of the applicant's electronic SAR or ISIR.
* * * * *
5. Section 668.55 is amended by revising paragraphs (b)(2) and (c)
to read as follows:
Sec. 668.55 Updating Information.
* * * * *
(b) * * *
(2) An applicant for a Federal Pell Grant who is not selected for
verification shall update the information contained in his or her
application regarding those factors and shall certify that the
information is correct as of the day that the applicant submits his or
her first SAR to the institution or signs his or her ISIR at the
institution.
(c) If an applicant has received Federal Pell Grant, campus-based,
Federal Stafford Loan, FDSL, or PAS program assistance for an award
year, and the applicant subsequently submits another application for
assistance under any of those programs for that award year, and the
applicant is required to update household size and number attending
postsecondary educational institutions on the subsequent application,
the institution--
(1) Is required to take that newly updated information into account
when awarding for that award year further Federal Pell Grant, campus-
based, FDSL or PAS program assistance or certifying a Federal Stafford
Loan application; and
(2) Is not required to adjust the Federal Pell Grant, campus-based,
FDSL, or PAS program assistance previously awarded to the applicant for
that award year, or any previously certified Federal Stafford Loan
application for that award year, to reflect the newly updated
information unless the applicant would otherwise receive an overaward.
* * * * *
6. Section 668.56 is amended by revising paragraphs (a)(5)(i) and
(b) introductory text to read as follows:
Sec. 668.56 Items to be verified.
(a) * * *
(5) * * *
(i) Social security benefits if the institution has reason to
believe that those benefits were received;
* * * * *
(b) If an applicant selected for verification submits an SAR or
output document to the institution or the institution receives the
applicant's ISIR, within 90 days of the date the applicant signed his
or her application, or if an applicant is selected for verification
under Sec. 668.54(a)(2), the institution need not require the applicant
to verify--
* * * * *
7. Section 668.57 is amended by revising paragraphs (a)(2) and
(d)(2) to read as follows:
Sec. 668.57 Acceptable documentation.
(a) * * *
(2) If an individual who filed a U.S. tax return and who is
required by paragraph (a)(1) of this section to provide a copy of his
or her tax return does not have a copy of that return, the institution
may require that individual to submit, in lieu of a copy of the tax
return, a copy of an IRS form which lists tax account information.
* * * * *
(d) * * *
(2) Social security benefits if the institution has reason to
believe that the applicant has incorrectly reported Social Security
benefits received by the applicant, applicant's parents, and any other
children of the applicant's parents who are members of the applicant's
household, in the case of a dependent student, or by the applicant, the
applicant's spouse, and the applicant's children in the case of an
independent student. The applicant shall verify Social Security
benefits by submitting a document from the Social Security
Administration showing the amount of benefits received in the
appropriate calendar year for the appropriate individuals listed above
or, at the institution's option, a statement signed by both the
applicant and the applicant's parent, in the case of a dependent
student, or by the applicant, in the case of an independent student,
certifying that the amount listed on the applicant's aid application is
correct; and
* * * * *
Sec. 668.58 [Amended]
8. In 668.58, paragraphs (a)(1)(ii) and (a)(2)(ii)(B) are amended
by removing the term ``CWS'' and adding in its place the words
``Federal Work-Study.''
9. Section 668.59 is amended by revising paragraphs (a)
introductory text, (a)(1) introductory text, (a)(1)(i), (a)(2),
(b)(2)(i) (B) and (C), (b)(2)(ii) (A) and (B) to read as follows:
Sec. 668.59 Consequences of a change in application information.
(a) For the Federal Pell Grant Program--
(1) Except as provided in paragraphs (a) (2) and (3) of this
section, if the information on an application changes as a result of
the verification process, the institution shall require the applicant
to resubmit his or her application information to the Secretary for
corrections if--
(i) The institution recalculates the applicant's EFC, determines
that the applicant's EFC changes, and determines that the change in the
EFC changes the applicant's Federal Pell Grant award; or
* * * * *
(2) An institution need not require an applicant with a reported
EFC of zero on his or her SAR or ISIR to resubmit that SAR to the
Secretary or correct the ISIR at the institution, if the institution
determines that the applicant's EFC remains at zero on the basis of the
verified information.
* * * * *
(b) * * *
(2) * * *
(i) * * *
(B) Recalculate the applicant's Federal Pell Grant award on the
basis of the EFC on the corrected SAR or ISIR; and
(C) Disburse any additional funds under that award only if the
applicant provides the institution with the corrected SAR or ISIR and
only to the extent that additional funds are payable based on the
recalculation.
(ii) * * *
(A) May disburse the applicant's Federal Pell Grant award on the
basis of the original EFC without requiring the applicant to resubmit
his or her application information to the Secretary; and
(B) Except as provided in Sec. 668.60(b), shall disburse any
additional funds under the increased award reflecting the new EFC if
the institution receives the corrected SAR or ISIR.
* * * * *
10. Section 668.60 is amended by revising paragraphs (b)
introductory text, (b)(1)(i)(A), (b)(1)(iii), (c)(1) and (2)
introductory text, and (d) to read as follows:
Sec. 668.60 Deadlines for submitting documentation and the
consequences of failing to provide documentation.
* * * * *
(b) For purposes of the campus-based, Federal Stafford Loan, FDSL
and PAS programs--
(1) * * *
(i) * * *
(A) Disburse any additional Federal Perkins Loan, FDSL, FSEOG or
PAS funds to the applicant;
* * * * *
(iii) The applicant shall repay to the institution any Federal
Perkins Loan, FDSL, FSEOG, or PAS payments received for that award
year;
* * * * *
(c) * * *
(1) An applicant may submit a verified SAR to the institution or
the institution may receive a verified ISIR after the applicable
deadline specified in 34 CFR 690.61 but within an established
additional time period set by the Secretary through publication of a
notice in the Federal Register. If the institution receives a verified
SAR or ISIR during the established additional time period, and the EFC
on the two SARs or ISIRs are different, payment must be based on the
higher of the two EFCs.
(2) If the applicant does not provide the requested documentation,
and if necessary, a verified SAR or ISIR, within the additional time
period referenced in paragraph (c)(1) of this section the applicant--
* * * * *
(d) The Secretary may determine not to process any subsequent
application for Federal Pell Grant, and an institution, if directed by
the Secretary, may not process any subsequent application for campus-
based, PAS, FDSL, or Federal Stafford Loan program assistance of an
applicant who has been requested to provide documentation until the
applicant provides the documentation or the Secretary decides that
there is no longer a need for the documentation.
* * * * *
11. Section 668.61 is amended by revising paragraph (a)(2)(ii)(B)
and adding an OMB control number to read as follows:
Sec. 668.61 Recovery of funds.
(a) * * *
(2) * * *
(ii) * * *
(B) The last day of the award year in which the institution
disbursed Federal Pell Grant, Federal Perkins Loan, FDSL, FSEOG or PAS
funds to the applicant.
* * * * *
Secs. 668.58, 668.59 [Amended]
12. In 34 CFR part 668 remove the terms ``need-based Income
Contingent Loan (ICL),'' ``and need-based ICL,'' and ``or need-based
ICL'' in the following places:
a. Section 668.58(a)(2)(i) and (a)(2)(ii); and
b. Section 668.59(c) introductory text and (c)(1)(ii).
Secs. 668.55, 668.58, 668.59, 668.60, 668.61 [Amended]
13. In 34 CFR Part 668 add the word ``Federal'' before the words
``Pell Grant'', ``Stafford Loan'', ``Perkins Loan'', or ``Supplemental
Educational Opportunity Grant'' in the following places each time they
appear:
a. Section 668.55(d)(2)(twice); and
b. Section 668.58(a)(1)(i), (a)(1)(iii)(three times), (a)(2)(i),
(a)(2)(iii)(A), (a)(2)(iii)(B)(twice), (c), (d)(1), and (d)(2); and
c. Section 668.59(b) introductory text, (b)(1), (c) introductory
text, (c)(1)(ii), and (d); and
d. Section 668.60(b)(1)(i)(C), (b)(1)(i)(D), (b)(1)(ii),
(b)(3)(twice), (c) introductory text, (c)(2)(i), (c)(2)(ii), and
(e)(2)(twice); and
e. Section 668.61(a)(2)(ii)(B).
[FR Doc. 94-9747 Filed 4-26-94; 8:45 am]
BILLING CODE 4000-01-U