[Federal Register Volume 61, Number 116 (Friday, June 14, 1996)]
[Notices]
[Pages 30438-30441]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-15126]




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Part V





Department of Education





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William D. Ford Federal Direct Loan Program; Solicitation of 
Applications; Notice

  Federal Register / Vol. 61, No. 116 / Friday, June 14, 1994 / 
Notices  

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DEPARTMENT OF EDUCATION


William D. Ford Federal Direct Loan Program; Solicitation of 
Applications

AGENCY: Department of Education.

ACTION: Notice of solicitation of applications.

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SUMMARY: The Secretary of Education invites applications from schools 
to participate in the William D. Ford Federal Direct Loan (Direct Loan) 
Program. This notice relates to the Federal Direct Stafford/Ford Loan 
Program, the Federal Direct Unsubsidized Stafford/Ford Loan Program, 
and the Federal Direct PLUS Program, collectively referred to as the 
Direct Loan Program.

APPLICATION DEADLINE: Applications may be submitted at any time.

FOR FURTHER INFORMATION CONTACT:
Kenneth Smith, U.S. Department of Education, 600 Independence Avenue 
SW., Room 3042, ROB-3, Washington, DC 20202-5400. Telephone: (202) 708-
9406. 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: The Omnibus Budget Reconciliation Act of 
1993, enacted on August 10, 1993, established the Direct Loan Program 
under Title IV, Part D, of the Higher Education Act of 1965, as amended 
(HEA). See Subtitle A of the Omnibus Budget Reconciliation Act of 1993 
(Pub. L. 103-66). Under the Direct Loan Program, loan capital is 
provided directly to student and parent borrowers by the Federal 
Government rather than through private lenders.

Background

    The HEA directs the Secretary to phase in the Direct Loan Program. 
The HEA provides that the student loan volume made under the Direct 
Loan Program should represent 5 percent of the total student loan 
volume in the first year of the program (academic year 1994-1995), 40 
percent for the second year of the program (academic year 1995-1996), 
50 percent for the third and fourth years of the program (academic 
years 1996-1997 and 1997-1998), and 60 percent for the fifth year of 
the program (academic year 1998-1999).
    The HEA allows the loan volume to exceed the percentage goals for 
academic years 1996-1997, 1997-1998, and 1998-1999 if the Secretary 
determines that a higher percentage is warranted by the number of 
institutions of higher education that desire to participate in the 
Direct Loan Program that meet the eligibility requirements for 
participation. See section 453(a)(2) and (3) of the HEA.
    Schools participating in the Direct Loan Program transmit and 
receive loan origination information electronically to and from a 
Direct Loan Servicer and receive Federal funds electronically. The 
Secretary provides PC software and mainframe specifications, as well as 
technical assistance, to schools to facilitate their implementation of 
the Direct Loan program.
    The standards for institutional participation in the Direct Loan 
Program for the 1995-1996 and subsequent years were published as final 
regulations on December 1, 1994 (59 FR 61664). See 34 CFR 685.400 and 
Sec. 685.402. These final regulations were developed after the 
Secretary received input from the financial aid community and other 
members of the public through a negotiated rulemaking process and 
numerous other opportunities for public comment.

Application and Selection Process

    The Secretary will accept applications from schools to participate 
in the Direct Loan Program at any time. The Secretary will select 
schools to participate in the Direct Loan Program periodically and will 
notify the institutions individually when they are selected.
    The Secretary encourages a potential participant to submit an 
application well in advance of the date on which the school will begin 
participation in the Direct Loan Program. This will allow a school more 
time to plan for its transition into the Direct Loan Program and to 
begin the transition process. Further, a school will be able to take 
advantage of training opportunities and prepare any campus materials it 
may choose to use in the Direct Loan Program.
    The Secretary will publish an interim list of the schools selected 
to participate in the Direct Loan Program for each academic year on or 
before December 16 of the preceding calendar year. A school that 
already has been selected to participate in the Direct Loan Program and 
an eligible school that previously applied to participate in the 
program but was not selected, need not submit an application again. 
However, if an eligible school that previously applied but did not 
participate (either because it was not selected or because it chose not 
to participate) does not wish to be considered for participation, it 
should notify the Secretary.

Solicitation of Applications for Participation in the Direct Loan 
Program

Purpose of Program

    To provide loans to enable students and parents of students to pay 
the students' costs of attendance at a postsecondary school. Under the 
Direct Loan Program, loan capital is provided directly to student and 
parent borrowers by the Federal Government rather than through private 
lenders.

Eligible Applicants

    Colleges, universities, graduate and professional schools, and 
vocational and technical schools that meet the definition of an 
eligible institution under section 435(a) of the HEA.

Deadline for Transmittal of Applications

    Applications may be submitted at any time.

For Information Contact

    Kenneth Smith, U.S. Department of Education, 600 Independence 
Avenue SW., Room 3042, ROB-3, Washington, DC 20202-5400. Telephone: 
(202) 708-9406. 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.

Application Form and Instructions

    The Secretary has developed an application form for a school to use 
to apply to participate in the Direct Loan Program. A copy of the 
application form is included as an Appendix to this notice. On this 
form, the signature of the President or Chief Executive Officer (CEO) 
of the institution is required. In addition, the school must designate 
an official at the school to receive Direct Loan Materials.
    If a school is applying as part of a consortium, it must indicate 
the exact names of all schools in the consortium and the name of the 
destination point (school or outside entity) for the consortium.
    In order to be considered for participation, a school must complete 
the application and mail or fax the application to: U.S. Department of 
Education, Office of Postsecondary Education, ROB-3, Federal Direct 
Loan Task Force, Room 4025, 600 Independence Avenue SW., Washington, DC 
20202-5162, FAX: (202) 260-6718, (202) 260-6705, or (202) 260-6706.


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(Catalog of Federal Domestic Assistance Number 84.268, William D. 
Ford, Federal Direct Loan Program)

    Dated: June 7, 1996.
David A. Longanecker,
Assistant Secretary for Postsecondary Education.

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[FR Doc. 96-15126 Filed 6-13-96; 8:45 am]
BILLING CODE 4000-01-M