[Federal Register Volume 77, Number 20 (Tuesday, January 31, 2012)]
[Rules and Regulations]
[Pages 4663-4674]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-2125]


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DEPARTMENT OF EDUCATION

34 CFR Subtitle B, Chapter II

[Docket ID ED-2011-OS-0005]
RIN 1894-AA02


Final Revisions to Certain Data Collection and Reporting 
Requirements, Final Priority; State Fiscal Stabilization Fund Program 
and Discretionary and Other Formula Grant Programs

AGENCY: Department of Education.

ACTION: Revisions to certain data collection and reporting 
requirements, and final priority.

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SUMMARY: The Secretary of Education (Secretary) issues final revisions 
to certain data collection and reporting requirements, and a final 
priority, under the State Fiscal Stabilization Fund program.

DATES: Effective March 1, 2012.

FOR FURTHER INFORMATION CONTACT: James Butler, State Fiscal 
Stabilization Fund Program, U.S. Department of Education, 400 Maryland 
Ave. SW., room 7E214, Washington, DC 20202-0008. Telephone: (202) 260-
9737 or by email: [email protected].
    If you use a telecommunications device for the deaf (TDD) or a text 
telephone (TTY), call the Federal Relay Service (FRS), toll free, at 1-
800-877-8339.

SUPPLEMENTARY INFORMATION:
    Purpose of Program: The State Fiscal Stabilization Fund (SFSF) 
program provided States approximately $48.6 billion in formula grants 
to help stabilize State and local budgets and minimize and avoid 
reductions in education and other essential services. In exchange, 
States committed to advance education reform in four key areas: (1) 
Achieving equity in the distribution of effective teachers; (2) 
improving the collection and use of data; (3) standards and 
assessments; and (4) supporting struggling schools.
    Program Authority: American Recovery and Reinvestment Act of 2009 
(ARRA), Division A, Title XIV--State Fiscal Stabilization Fund, Public 
Law 111-5; 20 U.S.C. 1221e-3 and 3474.
    Summary of Final Revisions: In this notice, the Secretary (1) 
exempts certain States from collecting and reporting on Descriptors 
(a)(1) and (a)(2) and Indicators (a)(3) through (a)(7); (2) eliminates 
the requirement for States to report data annually for Indicators 
(c)(1) through (c)(9) and (d)(1) through (d)(6); (3) extends to 
December 31, 2013, upon submission of an approvable request by a State, 
the deadline for meeting the requirements under Indicators (b)(1) and 
(c)(12); (4) extends to December 31, 2013, upon submission of an 
approvable request by a State, the deadline for collecting and publicly 
reporting or developing the capacity to collect and publicly report 
student enrollment data under Indicator (c)(11) for high school 
graduates who enroll in an in-state public institution of higher 
education (IHE); and (5) applies an alternative standard, upon 
submission of an approvable request by a State, by which a State may 
meet the Indicator (c)(11) data collection and reporting requirements 
for high school graduates who enroll in in-state private, out-of-state 
private, or out-of-state public IHEs. The Secretary establishes 
December 31, 2013, as the deadline by which a State must meet the 
requirements of the Indicator (c)(11) alternative standard.
    In addition, the Secretary establishes a priority that the 
Department may use in future discretionary grant competitions for 
States that have met the requirements of Indicator (b)(1) on or before 
the applicable deadline. Further, the Secretary establishes the 
authority to extend those sanctions to State educational agencies 
(SEAs) in States that have received an extension of the deadline to 
December 31, 2013, for Indicator (b)(1), (c)(11), or (c)(12) but fail 
to meet the revised deadline or that have received permission to use 
the alternative standard for Indicator (c)(11) but fail to meet the 
requirements of that standard by the deadline.
    The Department also establishes the authority to take enforcement 
action against an SEA under certain circumstances where a State fails 
to meet the requirements of Indicators (b)(1), (c)(11), or (c)(12).
    Background: Section 14005(d) of Division A of the ARRA required a 
State receiving funds under the SFSF program to provide assurances in 
four key areas of education reform: (1) Achieving equity in the 
distribution of effective teachers; (2) improving collection and use of 
data; (3) standards and assessments; and (4) supporting struggling 
schools.
    In a notice of final requirements, definitions, and approval 
criteria published in the Federal Register on November 12, 2009 (74 FR 
58436) (November 2009 Notice), the Department established specific data 
and information requirements (assurance indicators and descriptors) 
that a State had to meet to demonstrate compliance with the statutory 
assurances. We also established specific requirements for the plans 
that a State had to submit as part of its application for the second 
phase of funding under the SFSF program. These plans describe the steps 
a State would take to collect and publicly report, or to develop the 
capacity to collect and publicly report, the required data and other 
information.
    As we explained in the November 2009 Notice, these two sets of 
requirements make transparent the extent to which a State is 
implementing the promised reforms. Increased access to and focus on 
these data better enable States and other stakeholders to identify 
strengths and weaknesses in education systems and to determine where 
concentrated reform effort is warranted.
    We are taking the actions in this notice in response to the January 
18, 2011, Executive Order 13563 entitled ``Improving Regulation and 
Regulatory Review'' and the February 28, 2011, memorandum from the 
President to executive departments and agencies entitled 
``Administrative Flexibility, Lower Costs, and Better Results for 
State, Local, and Tribal Governments.'' These documents direct each 
Federal executive department and agency to review periodically its 
existing significant regulations and determine whether any should be 
modified, streamlined, expanded, or repealed so as to make the 
department's or agency's regulatory program more effective or less 
burdensome. These modifications

[[Page 4664]]

address concerns raised by some States about the time necessary to meet 
the requirements in the November 2009 Notice.
    As a result of our regulatory review of the SFSF program 
requirements, we also are publishing elsewhere in this issue of the 
Federal Register a notice of final requirement extending to January 31, 
2012, the deadline for States to meet the data collection and reporting 
requirements of the SFSF indicators.
    We note that in addition to the revised January 31, 2012, deadline 
for meeting the SFSF requirements, we are modifying certain other data 
collection and reporting requirements in this notice. All other SFSF 
requirements remain in effect as originally established.
    In addition, we note that where the SFSF indicators make use of 
information in ``Existing Collections'' (see column 4 of the table in 
Section I of State Fiscal Stabilization Fund: Summary of Final 
Requirements at http://www2.ed.gov/programs/statestabilization/summary-requirements.doc), the modification of an SFSF indicator does not 
affect other Federal requirements for those collections that are 
established under separate legal authority. Some of the data that 
States submit through the Department's EDFacts system to meet 
requirements established under other authorities (e.g., Title I 
accountability data) are also reported publicly by States to meet the 
requirements of certain SFSF indicators. Those requirements established 
by other authorities are not affected by the modification of any SFSF 
indicator in this notice.
    On September 23, 2011, we published a notice of proposed revisions 
to certain data collection and reporting requirements and proposed 
priority (NPR) in the Federal Register (76 FR 59074).
    Public Comment: In response to our invitation in the NPR, we 
received comments from six entities. There are several differences 
between the NPR and these final requirements.
    In the following section, we discuss substantive issues under the 
sections of the requirements to which they pertain. Generally, we do 
not address technical and other minor changes, or suggested changes the 
applicable statutory authority does not authorize us to make. In 
addition, we do not address general comments that raised concerns not 
directly related to the proposed provisions or the proposed priority.
    Analysis of Comments and Changes: Deadline for Complying With 
Indicators (b)(1), (c)(11), AND (c)(12).
    Comment: Three commenters expressed support for the Department's 
proposal to extend beyond January 31, 2012, the deadline for developing 
and implementing a statewide longitudinal data system (SLDS) under 
Indicator (b)(1) that includes all the 12 elements required under the 
America COMPETES Act. Further, five commenters supported the 
Department's proposal to extend beyond January 31, 2012, the deadline 
for complying with the requirements of Indicator (c)(11). One of these 
commenters stated that the need to establish a longer time frame for 
full compliance with Indicator (c)(11) seemed fair as it responded to 
comments that were discussed in the November 2009 Notice. In addition, 
one commenter expressed concerns about the cost of obtaining 
information on students who attend private and out-of-state IHEs.
    Discussion: The Department appreciates the concerns expressed by 
commenters regarding the ability of States to fully comply with the 
requirements of Indicators (b)(1) and (c)(11) in a timely fashion. 
These concerns would also apply to Indicator (c)(12) because compliance 
with the requirements of that indicator is dependent upon the 
development and implementation of an SLDS. Because of these concerns, 
the Department believes that it is appropriate to extend the deadline 
for meeting the requirements of Indicators (b)(1), (c)(11), and (c)(12) 
to December 31, 2013 rather than December 31, 2012, as proposed in the 
NPR. An extension will be granted only to those States that submit an 
approvable extension request.
    Change: The Department extends to December 31, 2013, upon 
submission of an approvable request by a State--
    (a) The deadline for the development and implementation of an SLDS 
under Indicator (b)(1) that includes the 12 elements included in the 
America COMPETES Act;
    (b) The deadline by which a State must collect and publicly report, 
or have the capacity to collect and publicly report, the required 
course completion data under Indicator (c)(12); and
    (c) The deadline by which a State must collect and publicly report, 
or have the capacity to collect and publicly report, the student 
enrollment data required under Indicator (c)(11) for high school 
graduates who attend an in-state public IHE.
    Under the alternative standard for Indicator (c)(11), the 
Department extends to December 31, 2013, the deadline by which a State 
must increase its current capacity to collect and publicly report the 
required student enrollment data for high school graduates who attend a 
private or an out-of-state public IHE.

Process for Requesting an Extension

    Comment: One commenter suggested that the Department (1) create a 
streamlined and user-friendly form to request deadline extensions and 
use of the alternative standard; (2) approve extension requests for 
complying with the requirements of Indicators (b)(1), (c)(11), and 
(c)(12) before requiring a State to provide a revised plan for the 
applicable indicator; and (3) automatically grant an extension of the 
deadline for an indicator if the State has a later deadline for the 
same activity under another Department program.
    Discussion: The Department is providing a streamlined and user-
friendly form for requests to extend a deadline or use the alternative 
standard. The Department will approve these requests on the basis of 
assurances provided by the Governor and the Chief State School Officer. 
The State will have 60 days after submission of the request to provide 
the revised plan. If a State fails to meet the revised and approved 
State plan requirements, the Department will take appropriate 
enforcement actions. The Department's program offices do coordinate 
implementation of program requirements under various statutory or 
regulatory authorities. However, many programs have specific 
requirements that differ from the requirements of other programs. As a 
result, the Department often establishes program-specific requirements 
and deadlines and will not automatically extend the deadline for 
complying with the SFSF indicators and descriptors on the basis of a 
later deadline for another program.
    Changes: None.

Elimination of Annual Reporting Requirements for Certain Indicators

    Comment: One commenter supported the elimination of the annual 
reporting requirements for Indicators (c)(1) through (c)(9) and (d)(1) 
through (d)(6).
    Discussion: The Department appreciates the support of the commenter 
and, as stated in the NPR, we do not believe that it is necessary to 
have States annually collect and publicly report these data given the 
availability of the data from other sources.
    Changes: None.

Teacher and Principal Evaluation Systems

    Comment: One commenter suggested that the Department extend beyond 
January 31, 2012, the deadline for

[[Page 4665]]

collecting and publicly reporting data related to teacher and principal 
evaluation systems. The commenter noted that the January 31, 2012, 
deadline is inconsistent with the timelines for the development and 
implementation of teacher and principal evaluation systems outlined in 
the September 23, 2011, ESEA Flexibility guidance.
    Discussion: The Department agrees that a State with an approved 
ESEA Flexibility request should not have to report data and information 
on the current teacher and principal evaluation systems of its local 
educational agencies (LEAs) by the January 31, 2012, SFSF deadline 
because that State will have committed to developing, adopting, 
piloting, and implementing rigorous teacher and principal evaluation 
and support systems. The deadline for implementing rigorous teacher and 
principal evaluation systems under the ESEA Flexibility extends beyond 
the January 31, 2012, SFSF deadline. Therefore, the Department is 
eliminating the requirement for a State to collect and publicly report 
data under SFSF Descriptors (a)(1) and (a)(2) and Indicators (a)(3) 
through (a)(7) if that State has an approved ESEA Flexibility request.
    Changes: We have modified the final requirements to provide that 
the collection and public reporting requirements under SFSF Descriptors 
(a)(1) and (a)(2) and Indicators (a)(3) through (a)(7) do not apply to 
a State that has an approved ESEA Flexibility request. Statewide 
Longitudinal Data System (Indicator (b)(1))
    Comment: One commenter asked whether development and implementation 
of an SLDS may be predicated on the State's receiving an award under 
the Statewide Longitudinal Data Systems grant.
    Discussion: ARRA requires all States, as a condition of receiving 
funds under the SFSF program, to develop and implement an SLDS that 
includes all 12 elements required under the America COMPETES Act. In 
its application for SFSF funding, each State assured that it would meet 
this requirement by the established deadline. Thus, a State must 
develop and implement such a system whether or not it receives an SLDS 
grant. A State could have used, among other funds, SFSF Government 
Services funds to meet this requirement.
    Changes: None.
    Comment: One commenter requested that the Department be flexible in 
determining whether a State has developed and implemented an SLDS that 
includes the 12 elements and that the Department share with States any 
expectations that it has for those elements.
    Discussion: The Department understands that individual States' 
longitudinal data systems may vary and still meet the requirements of 
the America COMPETES Act. In addition, the Department acknowledges that 
State requirements and processes may affect the manner in which a State 
complies with ARRA's requirements. The Department will consider these 
factors when considering a State's compliance with the requirements of 
Indicator (b)(1). The Department intends to work collaboratively with 
States while reviewing State compliance with SFSF requirements, as it 
has done during the initial SFSF monitoring reviews.
    Changes: None.
    Comment: One commenter suggested that the Department require a 
State to provide, in its request for a further extension of the 
deadline for Indicator (b)(1), a description of the challenges that 
cause the need for the extension.
    Discussion: During the Department's monitoring of State 
implementation of the SFSF program, a number of States indicated to us 
that competing challenges and diminished capacity have made it 
difficult for them to meet the previously established deadline for some 
of the more challenging indicators. In recognition of this, the 
Department has extended the deadline for meeting the requirements of 
all indicators from September 30, 2011, to January 31, 2012, and has 
established a process for States to request a further extension to 
December 31, 2013, of the deadline for the more challenging indicators 
(b)(1), (c)(11), and (c)(12). We believe that any benefits that might 
be derived from requiring a justification for this extension would not 
outweigh the additional burden placed on States to do so.
    Changes: None. Postsecondary Student Enrollment Data (Indicator 
(c)(11)).
    Comment: One commenter expressed concern about the expense 
associated with a State having to enter into multiple data-sharing 
agreements with IHEs to collect postsecondary student enrollment data. 
The commenter recommended that the Department consider extending its 
role to that of a broker of data-sharing agreements between public 
higher education consortia and other entities such as third-party 
companies and States. Alternatively, the commenter recommended that the 
Department eliminate the requirement that States collect enrollment 
data on high school graduates who attend private or out-of-state IHEs.
    Discussion: The Department believes that because differences in 
State statutory and regulatory requirements could affect the nature and 
scope of data-sharing agreements between States and IHEs, it is 
appropriate that decisions regarding these matters be addressed at the 
State rather than the Federal level. The Department acknowledges that 
collecting enrollment data on high school graduates who attend private 
and out-of-state IHEs can be challenging and, therefore, is providing 
States with an alternative standard for meeting the requirements of 
Indicator (c)(11) for such students. However, we are not eliminating 
this data collection requirement because we believe that these data, 
together with the course completion data under Indicator (c)(12), 
provide stakeholders with critical information on the effectiveness of 
secondary education across States.
    Changes: None.
    Comment: One commenter requested that the Department clarify 
whether the alternative standard for collecting and publicly reporting 
data under Indicator (c)(11) applies to in-state and out-of-state 
private IHEs and out-of-state public IHEs. The same commenter inquired 
whether a State could propose an alternative standard or whether a 
State would only be permitted to use the standard established by the 
Department.
    Discussion: The alternative standard, which was defined in the NPR, 
applies to in-state private IHEs, out-of-state private IHEs, and out-
of-state public IHEs. To help ensure that all States are developing the 
capacity to collect and publicly report similar data, the Department 
has established an alternative standard that will be applied across all 
States. Thus a State may not propose its own alternative standard for 
complying with the requirements of Indicator (c)(11).
    Changes: The Department has modified the alternative standard 
language to expressly state that the State must increase its capacity 
to collect and publicly report student enrollment data on high school 
graduates who attend in-state private IHEs, out-of-state private IHEs, 
and out-of-state public IHEs.
    Comment: One commenter requested clarification on the requirements 
for the data analysis that a State must conduct regarding current 
capacity for reporting on students enrolled in private or out-of-state 
public IHEs in order to receive approval to use the Indicator (c)(11) 
alternative standard.
    Discussion: In demonstrating that it has increased its capacity to 
collect and publicly report on student enrollment data for high school 
graduates who enroll in private or out-of-state IHEs, a

[[Page 4666]]

State could, among other things, enter into data reciprocity agreements 
with contiguous States or States with which it has tuition reciprocity 
agreements.
    Changes: None.
    Comment: One commenter questioned the relevance of the information 
that a State seeking to use the alternative standard would have to 
submit by December 31, 2012, to demonstrate that it had increased its 
capacity to report on the enrollment of high school graduates in 
private and out-of-state IHEs. That commenter also questioned the need 
to impose additional burden on States before providing additional 
flexibility and the Department's authority to collect the data under 
the alternative standard. The commenter recommended that the Department 
further extend the January 31, 2012, deadline by which States must 
report student enrollment data under Indicator (c)(11) without 
submitting additional information.
    Discussion: The Department believes that whether a State funds or 
enters into a data-sharing agreement with a private or out-of-state 
public IHE is relevant. A State is more likely to fund or enter into 
data-sharing agreements with those IHEs that enroll relatively large 
numbers of that State's residents. Further, the Department believes 
that the burden of meeting the requirements under the alternative 
standard will be minimal.
    The Department has the authority to impose reasonable conditions on 
States in exchange for providing them with additional flexibility in 
meeting programmatic requirements. Because in certain instances the 
deadline for States to comply with the requirements of Indicator 
(c)(11) may be extended 27 months beyond the initial September 30, 
2011, deadline, the Department believes that it is essential to collect 
the additional information required under the extension request. Use of 
the alternative standard is voluntary. Only if a State chooses to take 
advantage of the additional flexibility afforded under the alternative 
standard does it have to provide this information.
    Changes: None.
    Comment: One commenter recommended that the Department require 
States requesting authority to use the Indicator (c)(11) alternative 
standard to indicate in their requests whether they have regulatory or 
other authority over in-state private IHEs.
    Discussion: Under the requirements for requesting use of the 
Indicator (c)(11) alternative standard, States must indicate for each 
in-state private IHE whether that IHE receives funding from the State. 
The Department believes this information, together with information on 
whether the State has a data-sharing agreement with these IHEs, 
provides sufficient indication of whether a State has authority over 
in-state private IHEs.
    Changes: None
    Comment: One commenter suggested that the Department require States 
to provide the percentage of their high school graduates who enroll in 
an in-state IHE to ``help provide transparency around the extent of the 
challenge States face in tracking their students out-of-state.''
    Discussion: Under Indicator (c)(11), a State must demonstrate that 
it has the capacity to collect and publicly report student enrollment 
data for high school graduates who enroll in in-state private, out-of-
state private, and out-of-state public IHEs; however, a State is not 
required to actually collect and publicly report those data. Thus, it 
would impose a burdensome new requirement on States to require them to 
report by December 31, 2013, on the percentage of students who enroll 
in in-state IHEs.
    Changes: None.

Postsecondary Course Completion Data

    Comment: One commenter requested that the Department clarify for 
Indicator (c)(12) the following: (1) The categories of students for 
which a State should provide course completion data (degree-seeking or 
all students enrolled for credit; part-time and full-time students; 
students who remain enrolled in the same public IHE; and students who 
transfer to another public IHE); and (2) the starting point for 
calculating credits earned within ``two years of enrollment'' in 
Indicator (c)(12).
    Discussion: States must have the capacity to report course 
completion data for those high school graduates who enroll for credit 
in a public IHE on a full-time or part-time basis within 16 months of 
their high school graduation. In determining whether a student has 
completed one year's worth of college credit applicable to a degree, as 
defined by the IHE, within two years of enrollment in an in-state 
public IHE, the State should consider the credits that the student 
earned at any in-state public IHE within two years of the date that the 
student initially enrolled in an in-state public IHE (as long as that 
initial enrollment was within 16 months of the student's high school 
graduation).
    Changes: None.

Plan Requirements

    Comment: One commenter asked the Department to clarify whether a 
Governor had to sign the revised plans that a State must submit to 
receive a further extension of the deadline for an indicator.
    Discussion: In the request for an extension, the Governor and Chief 
State School Officer must sign an assurance that the State will submit 
a revised plan for Indicator (b)(1), (c)(11), or (c)(12), as 
applicable. The Governor and Chief are not required to sign the plan 
itself.
    Changes: None.
    Comment: One commenter inquired whether a State may use a plan 
adopted for other programs to meet the revised plan requirement for 
Indicators (b)(1), (c)(11), or (c)(12), as applicable.
    Discussion: A State may use a plan adopted for another program so 
long as that plan meets the requirements established in this notice, 
including the requirement that the State meet the December 31, 2013, 
deadline.
    Changes: None.
    Comment: One commenter suggested that the Department make publicly 
available any revised plans submitted for Indicators (b)(1), (c)(11), 
and (c)(12).
    Discussion: The Department will make the revised plans available on 
its Web site and encourages States to make them available on their Web 
sites as well.
    Changes: None.

Priority

    Comment: One commenter suggested the Department provide in future 
grant competitions a priority not only for States that meet the 
requirements of Indicator (b)(1) but also for States that meet the 
requirements of Indicators (c)(11) and (c)(12) by the applicable 
deadline.
    Discussion: Although the Department recognizes the importance of a 
State being able to collect and publicly report the data required under 
Indicators (c)(11) and (c)(12), it wants to encourage States to focus 
on developing and implementing an SLDS that includes all of the 
elements required under the America COMPETES Act and, as a result, 
meets all of the requirements of Indicator (b)(1). The Department, 
therefore, is giving priority to those States that develop and 
implement an SLDS in a timely manner. We also note that if a State has 
developed and is implementing an SLDS that meets the statutory 
requirements, this will enable the State to comply with the 
requirements of Indicators (c)(11) and (c)(12).
    Changes: None.
    Revisions to Reporting Requirements:
Exemption From Reporting Requirements for Descriptors (a)(1) and (a)(2) 
and Indicators (a)(3) Through (a)(7)
    A State that has an approved ESEA Flexibility request is exempt 
from the

[[Page 4667]]

collection and public reporting requirements under SFSF Descriptors 
(a)(1) and (a)(2) and Indicators (a)(3) through (a)(7).
Elimination of Annual Reporting Requirements for Indicators (c)(1) 
Through (c)(9) and (d)(1) Through (d)(6)
    The Department requires each State to collect and publicly report, 
at least once, the data and other information required by Indicators 
(c)(1) through (c)(9) and (d)(1) through (d)(6). Any State that has 
already collected and publicly reported these data is not required to 
take any additional action for these indicators. Any State that has not 
already provided data under these indicators must do so by the January 
31, 2012, deadline.
Extension of Deadline for Indicators (b)(1) and (c)(12)
    The Department extends to December 31, 2013, upon submission of an 
approvable request by a State, the deadline for the development and 
implementation of an SLDS under Indicator (b)(1) that includes the 12 
elements included in the America COMPETES Act. The Department also 
extends to December 31, 2013, upon submission of an approvable request 
by a State, the deadline by which a State must collect and publicly 
report, or have the capacity to collect and publicly report, the 
required course completion data under Indicator (c)(12).
    An extension request must provide the specific information 
described under the heading Requirements for Requests for Extensions to 
December 31, 2013, of Deadlines for Indicator (b)(1), (c)(11), or 
(c)(12) or Use of the Indicator (c)(11) Alternative Standard.
Revisions to Requirements Under Indicator (c)(11)
    The Department extends to December 31, 2013, upon submission of an 
approvable request by a State, the deadline by which a State must 
collect and publicly report, or have the capacity to collect and 
publicly report, the student enrollment data required under Indicator 
(c)(11) for high school graduates who attend an in-state public IHE.
    An extension request must provide the specific information under 
the heading Requirements for Requests for Extensions to December 31, 
2013, of Deadlines for Indicator (b)(1), (c)(11), or (c)(12) or Use of 
the Indicator (c)(11) Alternative Standard.
    The Department also establishes an alternative standard by which a 
State may meet the Indicator (c)(11) data collection and reporting 
requirements with respect to high school graduates who enroll in in-
state private, out-of-state private, or out-of-state public IHEs. Under 
the alternative standard, a State must increase, by December 31, 2013, 
its current capacity to collect and publicly report the required 
student enrollment data for high school graduates who attend an in-
state private IHE, an out-of-state private IHE, or an out-of-state 
public IHE. A State will not be required to be fully capable of 
collecting and reporting these data by December 31, 2013.
    For the purposes of the alternative standard, a State will be 
considered to be making acceptable progress in increasing its capacity 
to collect and publicly report student enrollment data for high school 
graduates who enroll in in-state private IHEs, out-of-state private 
IHEs, or out-of-state public IHEs through such activities as: (1) 
Entering into data reciprocity agreements with private in-state IHEs 
that receive any State funds, including those for student financial 
aid, research, or any other activities; (2) entering into data 
reciprocity agreements with private in-state IHEs over which the State 
exercises significant oversight, such as serving as an accrediting 
body; (3) entering into data reciprocity agreements with geographically 
contiguous States or States with which it has tuition reciprocity 
agreements; or (4) conducting a data analysis to determine the out-of-
state IHEs where large numbers of the State's high school graduates 
enroll.
    States that use the alternative standard for Indicator (c)(11) are 
required to publicly report, by December 31, 2013, the following--
    (1) For each in-state private IHE--
    (a) Whether the State provides funding to the IHE;
    (b) Whether the State has a data-sharing agreement in place with 
the IHE and, if so, whether the data-sharing agreement enables the 
State to track its recent high school graduates; and
    (2) For each out-of-state private or out-of-state public IHE with 
which the State has a data-sharing agreement--
    (a) Whether the State provides funding to the IHE; and
    (b) Whether the data-sharing agreement enables the State to track 
its recent high school graduates.
    An extension request must include the specific information 
described under the heading Requirements for Requests for Extensions to 
December 31, 2013, of Deadlines for Indicator (b)(1), (c)(11), or 
(c)(12) or Use of the Indicator (c)(11) Alternative Standard.
Requirements for Requests for Extensions to December 31, 2013, of 
Deadlines for Indicator (b)(1), (c)(11), or (c)(12) or Use of the 
Indicator (c)(11) Alternative Standard
    Any request for an extension to December 31, 2013, of the deadline 
for Indicator (b)(1), (c)(11), or (c)(12), as well as any request to 
use the alternative standard for Indicator (c)(11), must be submitted 
and signed by both the Governor and the Chief State School Officer. 
Further, an extension request or a request to use the alternative 
standard must be submitted by February 17, 2012, unless the Department 
permits a State to submit a request at a later date. The additional 
requirements for these requests are as follows:

A. Indicator (b)(1) Extension Requests

    To receive an extension of the deadline for developing and 
implementing an SLDS that includes the 12 elements required by the 
America COMPETES Act under Indicator (b)(1), a State must provide the 
following information:
    (1) An identification of the elements in the America COMPETES Act 
that the State has implemented to date as part of its SLDS.
    (2) An assurance signed by the Governor and the Chief State School 
Officer that the State will--
    (i) Incorporate the remaining elements into its SLDS by the 
December 31, 2013, deadline; and
    (ii) Provide, within 60 days of submission of the request, a 
revised plan for incorporating those elements by the deadline.

B. Indicator (c)(11) Extension Requests

    To receive an extension of the deadline for collecting and publicly 
reporting under Indicator (c)(11) student enrollment data for high 
school graduates who enroll in an in-state public IHE, a State must 
provide the following information:
    (1) A description of the State's current capacity to collect and 
publicly report such student enrollment data.
    (2) An assurance signed by the Governor and the Chief State School 
Officer that the State will--
    (i)(A) Collect and publicly report by December 31, 2013, student 
enrollment data for high school graduates who attend an in-state public 
IHE; or
    (B) Develop the capacity to collect and publicly report those data 
by December 31, 2013; and
    (ii) Provide, within 60 days of submission of the request, a 
revised plan for how the State will--
    (A) Collect and publicly report the data by December 31, 2013; or

[[Page 4668]]

    (B) Develop the capacity to collect and publicly report those data 
by December 31, 2013.

C. Indicator (c)(12) Extension Requests

    A State must provide the following information when requesting an 
extension of the deadline for collecting and publicly reporting under 
Indicator (c)(12) course completion data for high school graduates who 
enroll in an in-state public IHE:
    (1) A description of the State's current capacity to collect and 
publicly report such course completion data.
    (2) An assurance signed by the Governor and the Chief State School 
Officer that the State will--
    (i)(A) Collect and publicly report, by December 31, 2013, course 
completion data required Indicator (c)(12) for high school graduates 
who attend an in-state public IHE; or
    (B) Develop the capacity to collect and publicly report, by 
December 31, 2013, such data; and
    (ii) Provide, within 60 days of submission of the request, a 
revised plan for how the State will--
    (A) Collect and publicly report the data by December 31, 2012; or
    (B) Develop the capacity to collect and publicly report such data 
by December 31, 2013.

D. Indicator (c)(11) Alternative Standard Requests

    A State must provide the following information when requesting 
permission to use the alternative standard to satisfy the Indicator 
(c)(11) requirements to collect and publicly report student enrollment 
data for high school graduates who enroll in private or out-of-state 
public IHEs:
    (1) A description of the State's current capacity to collect and 
publicly report such student enrollment data.
    (2) An assurance signed by the Governor and the Chief State School 
Officer that the State will--
    (i)(A) Collect and publicly report, by December 31, 2013, student 
enrollment data for high school graduates who enroll in in-state 
private, out-of-state private, or out-of-state public IHEs; or
    (B) Increase its current capacity to collect and publicly report 
such data by December 31, 2013, and, by that date, publicly report, the 
following--
    (1) For each in-state private IHE--
    (a) Whether the State provides funding to the IHE;
    (b) Whether the State has a data-sharing agreement in place with 
the IHE and, if so, whether the data-sharing agreement enables the 
State to track its recent high school graduates; and
    (2) For each out-of-state private or out-of-state public IHE with 
which the State has a data-sharing agreement, individually or through a 
State agency or consortium--
    (a) Whether the State provides funding to the IHE; and
    (b) Whether the data-sharing agreement enables the State to track 
its recent high school graduates;
    (ii) Provide, within 60 days of submission of the request, a 
revised plan for how the State will--
    (A) Collect and publicly report the data by December 31, 2012; or
    (B) Increase its current capacity to collect and report those data 
by December 31, 2013.
Requirements for Revised Plans for Indicator (b)(1), (c)(11), or 
(c)(12)
    The revised plans for Indicator (b)(1), (c)(11), or (c)(12) must 
include the following information:
    (a) A detailed description of the steps that the State will take to 
ensure that the requirements of the indicator will be met by December 
31, 2013, including a reasonable timeline for those actions.
    (b) Identification of the agency or agencies in the State 
responsible for the development and implementation of the revised plan.
    (c) An overall budget, including the funding sources, that is 
sufficient to support the development and implementation of the revised 
plan.
    Final Priority:
    This notice contains one priority.
Priority--Developing and Implementing a Statewide Longitudinal Data 
System That Includes the 12 Required Elements
    Priority: The Secretary gives priority to a State that has met the 
requirements of SFSF Indicator (b)(1) on or before the applicable 
deadline.
    Types of Priorities:
    When inviting applications for a competition using one or more 
priorities, we designate the type of each priority as absolute, 
competitive preference, or invitational through a notice in the Federal 
Register. The effect of each type of priority follows:
    Absolute priority: Under an absolute priority, we consider only 
applications that meet the priority (34 CFR 75.105(c)(3)).
    Competitive preference priority: Under a competitive preference 
priority, we give competitive preference to an application by (1) 
awarding additional points, depending on the extent to which the 
application meets the priority (34 CFR 75.105(c)(2)(i)); or (2) 
selecting an application that meets the priority over an application of 
comparable merit that does not meet the priority (34 CFR 
75.105(c)(2)(ii)).
    Invitational priority: Under an invitational priority, we are 
particularly interested in applications that meet the priority. 
However, we do not give an application that meets the priority a 
preference over other applications (34 CFR 75.105(c)(1)).
Authority To Take Enforcement Action Against SEAs
    If a State receives an extension of a deadline to December 31, 
2013, or the authority to use the alternative standard for Indicator 
(c)(11) but fails to meet the extended deadline or alternative 
standard, the Department may take enforcement actions against the SEA, 
including designation as high risk. In such instances, the Department 
may also elect not to award funds in a future discretionary grant 
competition to the SEA.
    The Department will take into account the specific circumstances of 
the grantee and the severity of the non-compliance.

    Note:  This notice does not solicit applications. In any year in 
which we choose to use the priority proposed in this notice, we 
invite applications through a notice in the Federal Register.

    Executive Orders 12866 and 13563:
Regulatory Impact Analysis
    Under Executive Order 12866, the Secretary must determine whether 
this regulatory action is ``significant'' and, therefore, subject to 
the requirements of the Executive order and subject to review by the 
Office of Management and Budget (OMB). Section 3(f) of Executive Order 
12866 defines a ``significant regulatory action'' as an action likely 
to result in a rule that may--
    (1) Have an annual effect on the economy of $100 million or more, 
or adversely affect a sector of the economy, productivity, competition, 
jobs, the environment, public health or safety, or State, local or 
Tribal governments or communities in a material way (also referred to 
as an ``economically significant'' rule);
    (2) Create serious inconsistency or otherwise interfere with an 
action taken or planned by another agency;
    (3) Materially alter the budgetary impacts of entitlement grants, 
user fees, or loan programs or the rights and obligations of recipients 
thereof; or
    (4) Raise novel legal or policy issues arising out of legal 
mandates, the President's priorities, or the principles stated in the 
Executive order.
    It has been determined that this regulatory action is a significant 
regulatory action subject to review by OMB under section 3(f) of 
Executive Order 12866.
    We have also reviewed these regulations under Executive Order

[[Page 4669]]

13563, which supplements and explicitly reaffirms the principles, 
structures, and definitions governing regulatory review established in 
Executive Order 12866. To the extent permitted by law, Executive Order 
13563 requires that an agency--
    (1) Propose or adopt regulations only upon a reasoned determination 
that their benefits justify their costs (recognizing that some benefits 
and costs are difficult to quantify);
    (2) Tailor its regulations to impose the least burden on society, 
consistent with obtaining regulatory objectives and taking into 
account--among other things and to the extent practicable--the costs of 
cumulative regulations;
    (3) In choosing among alternative regulatory approaches, select 
those approaches that maximize net benefits (including potential 
economic, environmental, public health and safety, and other 
advantages; distributive impacts; and equity);
    (4) To the extent feasible, specify performance objectives, rather 
than the behavior or manner of compliance a regulated entity must 
adopt; and
    (5) Identify and assess available alternatives to direct 
regulation, including economic incentives--such as user fees or 
marketable permits--to encourage the desired behavior, or provide 
information that enables the public to make choices.
    Executive Order 13563 also requires an agency ``to use the best 
available techniques to quantify anticipated present and future 
benefits and costs as accurately as possible.'' The Office of 
Information and Regulatory Affairs of OMB has emphasized that these 
techniques may include ``identifying changing future compliance costs 
that might result from technological innovation or anticipated 
behavioral changes.''
    We are issuing these final revisions only on a reasoned 
determination that their benefits justify their costs. In choosing 
among alternative regulatory approaches, we selected those approaches 
that maximize net benefits. Based on the analysis that follows, the 
Department believes that these final revisions are consistent with the 
principles in Executive Order 13563.
    We have also determined that this regulatory action will not unduly 
interfere with State, local, and tribal governments in the exercise of 
their governmental functions.
    In accordance with both Executive orders, the Department has 
assessed the potential costs and benefits of this regulatory action. 
The potential costs associated with this regulatory action are those 
resulting from statutory requirements and those we have determined as 
necessary for administering the Department's programs and activities. 
In this regulatory impact analysis, we discuss the need for regulatory 
action, the regulatory alternatives we considered, and the potential 
costs and benefits of the action.
    Need for Federal Regulatory Action:
    The revisions in this notice are the result of a regulatory review 
\1\ of the SFSF requirements established in the November 2009 Notice 
and also a response to concerns raised by States regarding their 
capacity to implement those requirements fully. The revisions eliminate 
requirements that have been identified through the regulatory review as 
overly burdensome or unnecessary for the achievement of the intended 
purposes of the SFSF program. The revisions also modify requirements 
that have been identified by certain States as not feasible to meet by 
the currently established deadline, by extending the deadline for 
establishing compliance or providing an alternative compliance standard 
for States that seek that flexibility. The Secretary believes that 
these revisions are needed in order for the Department to administer 
the SFSF program in a manner that enables States to provide sufficient 
transparency on the extent to which they are implementing education 
reform actions consistent with the assurances provided in their SFSF 
applications while affording them an appropriate amount of time and 
flexibility to implement those actions. The Secretary further believes 
that this notice's requirements for requesting an extension of the 
deadline for Indicator (b)(1), (c)(11), or (c)(12) or using the 
Indicator (c)(11) alternative standard, as well as the requirements for 
revising plans for those indicators, are necessary to ensure that 
States' actions are consistent with the requirements for those 
indicators.
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    \1\ As discussed elsewhere in this notice, the regulatory review 
was conducted in response to the January 18, 2011 Executive Order 
13563 entitled ``Improving Regulation and Regulatory Review'' and 
the February 28, 2011 Memorandum from the President to executive 
departments and agencies entitled ``Administrative Flexibility, 
Lower Costs, and Better Results for State, Local, and Tribal 
Governments.''
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    Regulatory Alternatives Considered:
    An alternative to promulgation of the revisions in this notice 
would be to take no regulatory action and, instead, take enforcement 
action, such as recovering or withholding Department funds or 
establishing compliance agreements, against States that fail to comply 
with the relevant SFSF requirements established in the November 2009 
Notice. In general, the Secretary believes that the latter approach 
would unfairly punish States that the Department believes, based on 
available information on implementation of SFSF plans, are making a 
good-faith effort to fully develop their statewide longitudinal data 
systems and their capacity to collect and report data on student 
postsecondary enrollment and persistence, but need more time to comply 
with the SFSF requirements. That said, the Secretary believes that 
States must fully develop statewide longitudinal data systems and may 
place on high-risk status those States that fail to comply with the 
requirements of Indicator (b)(1) by the current or (if approved for the 
State) extended deadline.
    With respect to Indicator (c)(11), the Department considered 
proposing only an extension of the deadline for collecting and 
reporting student enrollment data for high school graduates who attend 
IHEs, but concluded that extending the deadline for the public, in-
state IHEs and providing additional flexibility with the alternative 
standard for collecting and publicly reporting student enrollment data 
for high school graduates who attend private and out-of-state public 
IHEs better addresses the capacity concerns raised by States.
    Summary of Costs and Benefits:
    Revisions to SFSF Indicator Requirements:
    In the November 2009 Notice, the Department provided detailed 
estimates of the costs to States, LEAs, and IHEs of complying with the 
SFSF requirements. We have assessed the potential costs and benefits of 
the revisions to those requirements in this notice and determined that 
they impose no net additional costs to States, LEAs, or IHEs.
    On the contrary, the revisions will produce potential net cost 
savings.\2\ For instance, the exemption for certain States from the 
reporting requirements under Descriptors (a)(1) and (a)(2) and 
Indicators (a)(3) through (a)(7) and the elimination of the annual 
reporting requirements for Indicators (c)(1) through (c)(9) and (d)(1) 
through (d)(6) confer savings by reducing collection and reporting 
burden on States and LEAs. Although it confers some new cost (as 
discussed in more detail later in this section), the Indicator (c)(11) 
alternative standard confers net savings to States using the standard 
(and to affected LEAs and IHEs) by no longer

[[Page 4670]]

requiring that those States, at a minimum, fully develop the capacity 
to collect and report, by September 30, 2011, enrollment data for high 
school graduates who enroll in private or out-of-state public IHEs. The 
extensions of the compliance deadlines for Indicators (b)(1), (c)(11), 
and (c)(12) will not add to the costs of complying with the associated 
requirements and might result in marginal savings (calculated on a 
present-value basis) as States will be able to spread the compliance 
costs over a longer period of time.
---------------------------------------------------------------------------

    \2\ We have not provided estimates of potential cost savings in 
this notice because we cannot reasonably estimate the amount of 
funds States have already spent to meet the applicable SFSF 
requirements.
---------------------------------------------------------------------------

    Apart from potential cost savings, the benefits of the revisions 
are, as discussed elsewhere in this notice, simplified and more 
streamlined SFSF requirements that still provide the Department and the 
public with useful information on whether States are implementing 
education reforms that are consistent with the statutorily required 
assurances.
    States using the Indicator (c)(11) alternative standard will incur 
minimal new costs. Under the standard, a State must publicly report, by 
December 31, 2013, information on the extent to which it has data-
sharing agreements with private and out-of-state public IHEs that 
enable the State to track its recent high school graduates and 
demonstrate certain concrete steps it has taken to increase its 
capacity to track its high school graduates who enrolled in private and 
out-of-state public IHEs. We estimate that a State will need, on 
average, 40 hours to collect and report this information. At $30 per 
hour, the average cost of doing so is an estimated $1,200.
    Based on information available from States on implementation of 
their SFSF plans, we estimate that 43 States will request use of the 
Indicator (c)(11) alternative standard. The total estimated cost to 
States for complying with the Indicator (c)(11) alternative standard 
reporting requirements is accordingly $51,600 ($1,200 times 43 States).
    Requirements for Requests for Extensions of Deadlines for Indicator 
(b)(1), (c)(11), or (c)(12) or Use of the Indicator (c)(11) Alternative 
Standard, and Requirements for Revised Plans for Indicator (b)(1), 
(c)(11), or (c)(12):
    The costs for complying with these requirements will, in general, 
be minimal. Because States that do not meet the requirements associated 
with an SFSF indicator or descriptor were already required to submit a 
plan for achieving compliance that includes progress tracking and 
providing regular public progress reports, we do not believe that any 
new effort will be needed in order for a State to determine whether to 
request an extension of the deadline for Indicator (b)(1), (c)(11), or 
(c)(12) or use of the Indicator (c)(11) alternative standard.
    In requesting a deadline extension or use of the alternative 
standard, a State must provide a description of its current capacity 
with respect to the applicable indicator and a signed assurance that it 
will comply with the revised requirements for the indicator and will 
submit its plan for doing so to the Department within 60 days of the 
request. The level of effort needed to meet these requirements is 
minimal. We estimate that a State will need, on average, eight hours to 
complete such a request. At $30 per hour, the average cost of 
completing a request is an estimated $240.
    Based on information available from States on implementation of 
their SFSF plans, we estimate that 40 States will request an extension 
of the deadline for Indicator (b)(1), 43 States will request an 
extension of the deadline for Indicator (c)(11), 47 States will request 
an extension of the deadline for Indicator (c)(12), and 43 States will 
request use of the Indicator (c)(11) alternative standard. In total, 
States will complete an estimated 173 requests. At $240 per request, 
the total estimated cost to States for complying with the requirements 
for requests is $41,520 ($240 times 173 requests).
    A State requesting a deadline extension or the use of the Indicator 
(c)(11) alternative standard must submit to the Department, within 60 
days, a revised plan with respect to the applicable indicator that 
includes the specific steps the State will take to meet the revised 
requirements for the indicator, the budget for developing and 
implementing the revised plan, and the responsible agency or agencies. 
The cost of meeting these plan revision requirements should also be 
minimal. We estimate that a State will need, on average, eight hours to 
complete a plan revision consistent with the requirements. At $30 per 
hour, the average cost of completing a plan revision is an estimated 
$240.
    As discussed above, States will complete an estimated 173 total 
requests for deadline extensions or for use of the Indicator (c)(11) 
alternative standard. Accordingly, we estimate that States will 
complete, at most, 173 plan revisions.\3\ At $240 per revision, the 
total estimated cost to States for complying with the plan revision 
requirements is $41,520 ($240 per revision times 173 requests).
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    \3\ A State requesting both an extension of the deadline for 
Indicator (c)(11) (as it applies to data on student enrollment in 
in-state public IHEs) and use of the alternative standard for that 
indicator (as it applies to data on student enrollment in private 
and out-of-state public IHEs) could address both of these requests 
in a single plan revision for the indicator. Consequently, the total 
number of completed plan revisions will almost certainly be lower 
than this estimate.
---------------------------------------------------------------------------

    The total estimated cost for complying with the requirements for 
requests and for plan revisions is accordingly $83,040.
    The November 2009 Notice detailed the cost of collecting and 
reporting the information and data associated with Indicators (b)(1), 
(c)(11), and (c)(12) on an annual basis. We expect that the cost of 
meeting these requirements will be reduced because most States have 
completed a substantial amount of the work related to collecting and 
reporting the required information. However, States requesting an 
extension of Indicator (b)(1), (c)(11), or (c)(12) will need to report 
the information and data for an additional year. We discuss the costs 
associated with reporting these indicators for an additional year 
below.
    We estimate that, on average, a State will need one hour to collect 
and report the information associated with Indicator (b)(1). This is a 
one-hour reduction from the estimate in the November 2009 Notice 
because States have indicated that, on average, they have completed 50 
percent of the work associated with collecting and reporting this 
information. Based on information available from States on 
implementation of their SFSF plans, we expect that 40 States will need 
to collect and report this information. At $30 per hour, the average 
cost for collecting and reporting this information is $30. The total 
estimated cost for complying with the Indicator (b)(1) reporting 
requirements is $1,200 ($30 per hour times 40 States).
    As 9 States have already met the requirement for Indicator (c)(11), 
we expect that 43 States will need to collect and report the 
information associated with it, or provide evidence that they have 
developed the capacity to do so, for students who attend in-state, 
public IHEs. We estimate that, on average, a State will need 40 hours 
to meet this requirement. This is a reduction from the average hours 
per response in the November 2009 Notice because this estimate includes 
reporting only on students who attend in-state, public IHEs rather than 
all students enrolled in an IHE. The remaining students will be covered 
under the (c)(11) alternative standard. At $30 per hour, we estimate 
that the average cost of meeting this requirement is $1,200. The total 
estimated cost for States to comply with the requirements for Indicator 
(c)(11) is

[[Page 4671]]

$51,600 ($1,200 per State times 43 States).
    The 13,409 LEAs located in those 43 States will need to provide 
information associated with Indicator (c)(11). Based on an estimate of 
the total number of students enrolled in public IHEs in their home 
State,\4\ and based on the assumption that LEAs can provide this 
information at a rate of 20 students per hour, we estimate that these 
LEAs will require a total of 84,584 hours to comply with the 
requirements for Indicator (c)(11) at a total cost of $2,114,597. 
Divided by the total number of affected LEAs, we estimate that each LEA 
will require 6.31 hours to provide this information. This is a 
reduction from the average hours per response in the November 2009 
Notice because the current estimate relates only to students who attend 
in-state, public IHEs rather than to all students attending an IHE. 
Information on the remaining students will be covered under the (c)(11) 
alternative standard. At $25 per hour, the average cost per LEA of 
meeting the requirements of this Indicator is approximately $158.
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    \4\ According to the Digest of Education Statistics, 2009, 
2,240,414 first-time freshmen enrolled in public, degree-granting 
IHEs in fall 2008, which represented 74 percent of all first-time 
freshmen. See http://nces.ed.gov/programs/digest/d09/tables/dt09_199.asp. Also in fall 2008, 2,109,931 freshmen who graduated from 
high school within the last 12 months attended degree-granting IHEs 
in their home State, which represented 81 percent of all freshmen. 
See http://nces.ed.gov/programs/digest/d09/tables/dt09_223.asp. 1. 
An estimate of the number of first-time freshmen enrolled in public, 
degree-granting IHEs in their home State can be derived two ways. 
Applying the percentage of first-time freshmen attending public 
degree-granting IHEs to the number of first-time freshmen attending 
an IHE in their home State yields an estimate of 1,508,484, and 
applying the percentage of first-time freshmen attending an IHE in 
their home State to the number of first-time freshmen attending 
public degree-granting IHEs yields an estimate of 2,169,077. For the 
purposes of this estimate, the Department chooses the midpoint of 
these figures, which is 1,838,780. Applying the estimate (described 
earlier) that 94 percent of all first-time postsecondary students 
graduated from public schools, the Department estimates that 
1,691,678 public high school graduates enroll in public degree-
granting IHEs in their home State.
---------------------------------------------------------------------------

    Again, based on our estimate of the total number of students 
enrolled in public IHEs in their home State and the assumption that 
IHEs can provide this information at a rate of 20 students per hour, we 
estimate that a total of 84,584 hours will be required for the 1,676 
IHEs in the 43 affected States to respond to this requirement. On 
average, each IHE will need 50.47 hours to collect and report the 
information associated with Indicator (c)(11). This is an increase in 
the average hours per response in the November 2009 Notice because this 
estimate only relates to students who attend in-state public IHEs 
rather than all students attending an IHE. The remaining students will 
be covered under the (c)(11) alternative standard. The average burden 
per response increased from the burden estimated in the November 2009 
Notice because the analysis now accounts for in-state public IHEs in 
the 43 States that have not yet met this requirement. Because 74 
percent of freshmen attend in-state public IHEs, the burden in this 
notice is higher because it is no longer shared with private and out-
of-state IHEs, which led to lower overall burden than we estimated for 
all IHEs in the November 2009 Notice. We expect that 1,676 IHEs will 
need to provide this information. At $25 per hour, the average cost per 
IHE for collecting and reporting this information is $1,261.75. The 
total estimated cost for IHEs to comply with the reporting requirements 
for Indicator (c)(11) is $2,114,597.
    The total estimated cost for complying with the reporting 
requirements in Indicator (c)(11) is thus $4,280,794.
    Based on information provided by the States, we expect that 47 
States will need to collect and report the information associated with 
Indicator (c)(12). We estimate that, on average, a State will need 20 
hours to collect and report the information. This represents a 20-hour 
reduction from our estimate in the November 2009 Notice because States 
have indicated that, on average, they have completed 50 percent of the 
work associated with this Indicator. At $30 per hour, the average cost 
for collecting and reporting this information is $600. The total 
estimated cost for States to comply with the reporting requirements for 
Indicator (c)(12) is $28,200 ($600 per State times 47 States).
    The 1,555 IHEs located in these States must report information on 
the number of students who have completed at least one year's worth of 
college credit within two years of enrollment in the IHE. Based on data 
from the Digest of Education Statistics, we estimate that 1,140,855 
first-time freshmen are enrolled in degree-granting in-state public 
IHEs in the 47 States that have not yet met this requirement. We 
estimate that IHEs can provide this information at a rate of 20 
students per hour, which leads to approximately 57,043 hours of total 
effort across the affected IHEs at an estimated cost of $1,426,069. By 
dividing this total number of hours by the 1,555 public IHEs in the 47 
States, we estimate that, on average, an IHE will need 36.68 hours to 
collect and report the information associated with Indicator (c)(12). 
This represents a reduction from the average hours per response that we 
estimated in the November 2009 Notice because some States with higher 
than average percentages of in-state students have already completed 
this work. We estimate a reduced average response time after excluding 
the IHEs from States that have completed the work from the calculation. 
At $25 per hour of IHE effort, we estimate that the average cost for 
collecting and reporting this information is $917 per IHE.
    The total estimated cost for complying with the reporting 
requirements in Indicator (c)(12) is $1,454,269. The total estimated 
cost for complying with the collection and reporting requirements 
associated with Indicators (b)(1), (c)(11), and (c)(12) is accordingly 
$5,736,263.
    The total estimated cost for complying with those collection and 
reporting requirements and the requirements in this notice is 
$5,870,903.
    Regulatory Flexibility Act Certification:
    The Secretary certifies that this regulatory action will not have a 
significant economic impact on a substantial number of small entities. 
The small entities that this regulatory action will affect are small 
LEAs receiving funds under this program and small IHEs.
    This regulatory action will not have a significant economic impact 
on small LEAs because they will be able to meet the costs of compliance 
with this regulatory action using the funds provided under this 
program.
    With respect to small IHEs, the U.S. Small Business Administration 
Size Standards define these institutions as ``small entities'' if they 
are for-profit or nonprofit institutions with total annual revenue 
below $5,000,000 or if they are institutions controlled by small 
governmental jurisdictions, which are comprised of cities, counties, 
towns, townships, villages, school districts, or special districts, 
with a population of less than 50,000. Based on data from the 
Department's Integrated Postsecondary Education Data System (IPEDS), up 
to 427 small IHEs with revenues of less than $5 million may be affected 
by these requirements; only 33 of these IHEs are public. The small IHEs 
represent only 13 percent of degree-granting IHEs. In addition, only 
98,032 students (0.5 percent) enrolled in degree-granting IHEs in fall 
2007 attended these small institutions; just 11,830 of these students 
are enrolled in small, degree-granting public IHEs. As the burden for 
indicators (c)(11) and (c)(12) is driven by the number of students for 
whom IHEs will be required to submit data, small IHEs will require 
significantly less effort to adhere to these requirements

[[Page 4672]]

than will be the case for larger IHEs. Based on IPEDS data, the 
Department estimates that 1,873 of these students are first-time 
freshmen. As stated earlier in the Summary of Costs and Benefits 
section of this notice, the Department estimates that, as required by 
indicator (c)(11), IHEs will be able to confirm the enrollment of 20 
first-time freshmen per hour. Applying this estimate to the estimated 
number of first-time freshmen at small IHEs, the Department estimates 
that these IHEs will need to spend 94 hours to respond to this 
requirement at a total cost of $2,350 (assuming a cost of $25 per 
hour).
    The effort involved in reporting the number of students enrolling 
in a public IHE in their home State who complete at least one year's 
worth of college credit applicable toward a degree within two years as 
required by indicator (c)(12) will also apply to small IHEs, but will 
be limited to students who enroll in public IHEs in their home State. 
As discussed earlier in the Summary of Costs and Benefits section of 
this notice, the Department estimates that 81 percent of first-time 
freshmen who graduate from public high schools enroll in degree-
granting IHEs in their home State. Applying this percentage to the 
estimated number of first-time freshmen enrolled in small public IHEs 
(1,873), the Department estimates that small IHEs will be required to 
report credit completion data for a total of 1,517 students. For this 
requirement, the Department also estimates that IHEs will be able to 
report the credit completion status of 20 first-time freshmen per hour. 
Again, applying this data entry rate to the estimated number of first-
time freshmen at small public IHEs in their home State, the Department 
estimates that these IHEs will need to spend 76 hours to respond to 
this requirement at a total cost of $1,900. The total cost of these 
requirements for small IHEs is, therefore, $4,250; $2,068 of this cost 
will be borne by small private IHEs, and $2,182 of the cost will be 
borne by small public IHEs. Based on the total number of small IHEs 
across the Nation, the estimated cost per small private IHE is 
approximately $10, and the estimated cost per small public IHE is $66. 
The Department has, therefore, determined that the requirements will 
not represent a significant burden on small not-for-profit IHEs.
    In addition, the Department believes the benefits provided under 
this regulatory action will outweigh the burdens on these institutions 
of complying with the requirements. One of these benefits will be the 
provision of better information on student success in postsecondary 
education to policymakers, educators, parents, and other stakeholders. 
The Department believes that the information gathered and reported as a 
result of these requirements will improve public accountability for 
performance; help States, LEAs, and schools learn from one another and 
improve their decision-making; and inform Federal policymaking.
    A second major benefit is that better public information on State 
and local progress in the four reform areas will likely spur more rapid 
progress on those reforms, because States and LEAs that appear to be 
lagging in one area or another may see a need to redouble their 
efforts. The Department believes that more rapid progress on the 
essential educational reforms will have major benefits nationally, and 
that these reforms have the potential to drive dramatic improvements in 
student outcomes. The requirements that apply to IHEs should, in 
particular, spur more rapid implementation of pre-K-16 State 
longitudinal data systems.
    Paperwork Reduction Act of 1995:
    As part of its continuing effort to reduce paperwork and respondent 
burden, the Department conducts a preclearance consultation program to 
provide the general public and Federal agencies with an opportunity to 
comment on proposed and continuing collections of information in 
accordance with the Paperwork Reduction Act of 1995 (PRA) (44 U.S.C. 
3506(c)(2)(A)). This helps ensure that: the public understands the 
Department's collection instructions, respondents can provide the 
requested data in the desired format, reporting burden (time and 
financial resources) is minimized, collection instruments are clearly 
understood, and the Department can properly assess the impact of 
collection requirements on respondents.
    This notice of revisions contains information collection 
requirements previously approved under OMB control number 1810-0695.
    A Federal agency cannot conduct or sponsor a collection of 
information unless OMB approves the collection under the PRA and the 
corresponding information collection instrument displays a currently 
valid OMB control number. Notwithstanding any other provision of law, 
no person is required to comply with, or is subject to penalty for 
failure to comply with, a collection of information if the collection 
instrument does not display a currently valid OMB control number.
    Revisions to SFSF Indicator (c)(11) Requirements:
    Under the Indicator (c)(11) alternative standard, a State must 
publicly report, by December 31, 2013, information on the extent to 
which it has data-sharing agreements with private and out-of-state 
public IHEs that enable the State to track its recent high school 
graduates. We estimate that a State will need, on average, 40 hours to 
collect and report this information.
    Based on information available from States on implementation of 
their SFSF plans, we estimate that 43 States will request use of the 
Indicator (c)(11) alternative standard. The total estimated hours for 
States to comply with the Indicator (c)(11) alternative standard 
reporting requirements is accordingly an increase of 1,720 hours (40 
hours per request times 43 requests) under collection 1810-0695.
    Requirements for Requests for Extensions of Deadlines for Indicator 
(b)(1), (c)(11), or (c)(12) or Use of the Indicator (c)(11) Alternative 
Standard, and Requirements for Revised Plans for Indicators (b)(1), 
(c)(11), and (c)(12):
    Because States that did not meet the requirements associated with 
an SFSF indicator or descriptor were required to submit a plan for 
achieving compliance that includes progress tracking and providing 
regular public progress reports, we do not believe that any new effort 
will be needed in order for a State to determine whether to request an 
extension of the deadline for Indicator (b)(1), (c)(11), or (c)(12) or 
use of the Indicator (c)(11) alternative standard.
    In requesting a deadline extension or use of the alternative 
standard, a State must provide a description of its current capacity 
with respect to the applicable indicator and a signed assurance that it 
will comply with the revised requirements for the indicator and will 
submit its plan for doing so to the Department within 60 days of the 
request. The level of effort needed to meet these requirements should 
be minimal. We estimate that a State will need, on average, eight hours 
to complete such a request.
    Based on information available from States on implementation of 
their SFSF plans, we estimate that 40 States will request an extension 
of the deadline for Indicator (b)(1), 43 States will request an 
extension of the deadline for Indicator (c)(11), 47 States will request 
an extension of the deadline for Indicator (c)(12), and 43 States will 
request use of the Indicator (c)(11) alternative standard. In total, 
States will complete an estimated 173 requests. The total estimated 
hours for States to comply with the requirements for requests is an 
increase of 1,384 hours (eight hours per request times 173 requests) 
under collection 1810-0695.

[[Page 4673]]

    A State requesting a deadline extension or the use of the Indicator 
(c)(11) alternative standard will then be required to submit to the 
Department, within 60 days, a revised plan with respect to the 
applicable indicator that includes the specific steps the State will 
take to meet the revised requirements for the indicator, the budget for 
developing and implementing the revised plan, and the responsible 
agency or agencies. We estimate that a State will need, on average, 
eight hours to complete a plan revision consistent with the 
requirements.
    As discussed above, States will complete an estimated 173 total 
requests for deadline extensions or for use of the Indicator (c)(11) 
alternative standard. Accordingly, we estimate that States will 
complete, at most, 173 plan revisions.\5\ At eight hours per revision, 
the total estimated burden to States for complying with the plan 
revision requirements is an increase of 1,384 hours (eight hours per 
request times 173 requests) under collection 1810-0695.
---------------------------------------------------------------------------

    \5\ A State requesting both an extension of the deadline for 
Indicator (c)(11) (as it applies to data on student enrollment in 
in-state public IHEs) and use of the alternative standard for that 
indicator (as it applies to data on student enrollment in private 
and out-of-state public IHEs) could address both of these requests 
in a single plan revision for the indicator. Consequently, the total 
number of completed plan revisions will likely be lower than this 
estimate.
---------------------------------------------------------------------------

    The total estimated burden for complying with the requirements for 
requests and for plan revisions is accordingly 2,768 hours.
    After requesting an extension and providing a plan, a State must 
collect and report the information associated with Indicators (b)(1), 
(c)(11), and (c)(12) by December 31, 2013. Based on information 
available from States on implementation of their SFSF plan, we estimate 
that 40 States will need to report and collect the information 
associated with Indicator (b)(1). At an estimated one hour per 
collection and report, the total estimated burden to States is an 
increase of 40 hours (one hour per State times 40 States) under 
collection 1810-0695. The average response time of one hour per 
collection is a one-hour reduction from the estimates we provided in 
the November 2009 Notice because States have indicated that, on 
average, they have completed 50 percent of the work associated with 
reporting on this indicator.
    As 9 States have already met the requirement for Indicator (c)(11), 
we expect that 43 States will need to collect and report the 
information associated with Indicator (c)(11), or provide evidence that 
they have developed the capacity to do so, for students who attend in-
state, public IHEs. We estimate that, on average, a State will need 40 
hours to meet this requirement. This is a reduction from the average 
hours per response that we estimated in the November 2009 Notice 
because the current estimate only relates to students who attend in-
state, public IHEs rather than all students enrolled in an IHE. The 
remaining students will be covered under the (c)(11) alternative 
standard. The current estimate will equal a 1,720 hour (40 hours per 
State times 43 States) increase under collection 1810-0695.
    The 13,409 LEAs located in those 43 States will need to provide 
information associated with Indicator (c)(11). Based on an estimate of 
the total number of students enrolled in public IHEs in their home 
State,\6\ and based on the assumption that LEAs can provide this 
information at a rate of 20 students per hour, we estimate that these 
LEAs will require a total of 84,584 hours to comply with the 
requirements for Indicator (c)(11). Divided by the total number of 
affected LEAs, we estimate that each LEA will require 6.31 hours to 
provide this information. This will be a reduction from the average 
hours per response estimated in the November 2009 Notice because the 
current estimate only relates to students who attend in-state, public 
IHEs rather than all students attending an IHE. Information on the 
remaining students will be covered under the (c)(11) alternative 
standard.
---------------------------------------------------------------------------

    \6\ According to the Digest of Education Statistics, 2009, 
2,240,414 first-time freshmen enrolled in public, degree-granting 
IHEs in fall 2008, which represented 74 percent of all first-time 
freshmen. See http://nces.ed.gov/programs/digest/d09/tables/dt09_199.asp. Also in fall 2008, 2,109,931 freshmen who graduated from 
high school within the last 12 months attended degree-granting IHEs 
in their home State, which represented 81 percent of all freshmen. 
See http://nces.ed.gov/programs/digest/d09/tables/dt09_223.asp. 1. 
An estimate of the number of first-time freshmen enrolled in public, 
degree-granting IHEs in their home State can be derived two ways. 
Applying the percentage of first-time freshmen attending public 
degree-granting IHEs to the number of first-time freshmen attending 
an IHE in their home State yields an estimate of 1,508,484, and 
applying the percentage of first-time freshmen attending an IHE in 
their home State to the number of first-time freshmen attending 
public degree-granting IHEs yields an estimate of 2,169,077. For the 
purposes of this estimate, the Department chooses the midpoint of 
these figures, which is 1,838,780. Applying the estimate (described 
earlier) that 94 percent of all first-time postsecondary students 
graduated from public schools, the Department estimates that 
1,691,678 public high school graduates enroll in public degree-
granting IHEs in their home State.
---------------------------------------------------------------------------

    Again, based on our estimate of the total number of students 
enrolled in public IHEs in their home State and the assumption that 
IHEs could provide this information at a rate of 20 students per hour, 
we estimate that a total of 84,584 hours will be required for the 1,676 
IHEs in the 43 affected States to respond to this requirement. On 
average, each IHE will need 50.47 hours to provide the information 
associated with Indicator (c)(11). This is an increase in the average 
hours per response estimated in the November 2009 Notice because this 
estimate only relates to students who attend in-state public IHEs 
rather than all students attending an IHE. The remaining students will 
be covered under the (c)(11) alternative standard. The average burden 
per response increased from the burden estimated in the November 2009 
Notice because the analysis now accounts for in-state public IHEs in 
the 43 States that have not yet met this requirement. Because 74 
percent of freshmen attend in-state public IHEs, the burden under these 
revisions is higher because it is no longer shared with private and 
out-of-state IHEs, which led to an estimate of a lower overall burden 
for all IHEs in the November 2009 Notice. We expect that 1,676 IHEs 
will need to provide this information.
    The total estimated hours for complying with the requirements of 
Indicator (c)(11) is 170,888.
    We estimate that the State burden for collecting and reporting the 
information associated with Indicator (c)(12), or providing evidence 
that the State has developed the capacity to do so, will be 
approximately 20 hours per State. This is a 20-hour reduction from the 
estimates in the November 2009 Notice because States have indicated 
that they have, on average, completed 50 percent of the work for this 
Indicator. Based on information provided by the States, we expect that 
47 States will need to provide this information. Accordingly, the total 
burden to States is an increase of 940 hours (20 hours per State times 
47 States) under collection 1810-0695.
    The 1,555 IHEs located in these States must report information on 
the number of students who have completed at least one year's worth of 
college credit within two years of enrollment in the IHE. Based on data 
from the Digest of Education Statistics, we estimate that 1,140,855 
first-time freshmen are enrolled in degree-granting in-state public 
IHEs in the 47 States that have not yet met this requirement. We 
estimate that IHEs can provide this information at a rate of 20 
students per hour, which leads to approximately 57,043 hours of total 
effort across the affected IHEs. By dividing the this total number of 
hours by the 1,555 public IHEs in the 47 States, we estimate that, on 
average, an IHE will need 36.68 hours to collect and report the

[[Page 4674]]

information associated with Indicator (c)(12). The average hours per 
response is less than the estimate in the November 2009 Notice because 
some States with higher than average percentages of in-state students 
have already completed this work. Excluding the IHEs from these States 
from the calculations led to a reduced average response time.
    The total estimated burden hours for complying with the collection 
and reporting requirements for Indicator (c)(12) is thus 57,983.
    The estimated burden hours for complying with the collection and 
reporting requirements associated with the Indicator (c)(11) 
alternative standard is discussed above.
    The total estimated burden hours for complying with the collection 
and reporting requirements associated with Indicators (b)(1), (c)(11) 
and (c)(12) is accordingly 228,911 hours.
    The total estimated burden for complying with the requirements in 
this notice is an increase of 233,399 hours under collection 1810-0695.

                        Collection of Information
------------------------------------------------------------------------
                                                OMB Control number and
           Information collection            estimated change in burden.
------------------------------------------------------------------------
This notice of revisions establishes an      OMB 1810-0695. The burden
 extension for collecting and reporting       will increase by 233,399
 information associated with Indicators       hours.
 (b)(1), (c)(11), and (c)(12); an
 alternative standard for Indicator
 (c)(11); establishes requirements for
 requests for extensions of deadlines for
 Indicators (b)(1), (c)(11), and (c)(12);
 and establishes requirements for revised
 plans for Indicators (b)(1), (c)(11), and
 (c)(12).
------------------------------------------------------------------------

    Assessment of Educational Impact: In the NPR and in accordance with 
section 411 of the General Education Provisions Act, 20 U.S.C. 1221e-4, 
we requested comments on whether the proposed requirements would 
require transmission of information that any other agency or authority 
of the United States gathers or makes available.
    Based on the response to the NPR and on our review, we have 
determined that these final requirements do not require transmission of 
information that any other agency or authority of the United States 
gathers or makes available.
    Intergovernmental Review: This program is subject to Executive 
Order 12372 and the regulations in 34 CFR part 79. One of the 
objectives of the Executive order is to foster an intergovernmental 
partnership and a strengthened federalism. The Executive order relies 
on processes developed by State and local governments for coordination 
and review of Federal financial assistance.
    This document provides early notification of our specific plans and 
actions for this program.
    Accessible Format: Individuals with disabilities can obtain this 
document in an accessible format (e.g., braille, large print, 
audiotape, or compact disc) on request to the program contact person 
listed under FOR FURTHER INFORMATION CONTACT.
    Electronic Access to This Document: The official version of this 
document is the document published in the Federal Register. Free 
Internet access to the official edition of the Federal Register and the 
Code of Federal Regulations is available via the Federal Digital System 
at: www.gpo.gov/fdsys. At this site you can view this document, as well 
as all other documents of this Department published in the Federal 
Register, in text or Adobe Portable Document Format (PDF). To use PDF 
you must have Adobe Acrobat Reader, which is available free at the 
site.
    You may also access documents of the Department published in the 
Federal Register by using the article search feature at: 
www.federalregister.gov. Specifically, through the advanced search 
feature at this site, you can limit your search to documents published 
by the Department.

Catalog of Federal Domestic Assistance (CFDA) Numbers: 84.394 
(Education Stabilization Fund) and 84.397 (Government Services 
Fund).

    Dated: January 26, 2012.
Arne Duncan,
Secretary of Education.
[FR Doc. 2012-2125 Filed 1-30-12; 8:45 am]
BILLING CODE 4000-01-P