Washington News Brief

By Sharon H. Bob, Ph.D., Higher Education Specialist, Powers Pyles Sutter and Verville, PC

House Education and Labor Democrats release a report outlining actions by Acting Under Secretary to help Dream Center; NACIQI votes against suspending HLC’s accrediting powers

In July, the House Education and Labor Committee Democrats released a report titled, “Shattered Dreams: Examining the Education Department’s Role in the Misconduct of Dream Center Education Holdings.” The report outlines the actions taken by Acting Under Secretary of Education Diane Auer Jones to help proprietary schools, such as pressuring the Higher Learning Commission (HLC) into retroactively reinstating the accreditation of two Dream Center campuses.

A copy of the report is found at: https://edlabor.house.gov/imo/media/doc/Shattered%20Dreams%20Examining%20the%20Education%20Departments%20Role%20in%20the%20Misconduct%20of%20Dream%20Center%20Education%20Holdings1.pdf

On Aug. 29, 2020, the Department of Education’s National Advisory Committee on Institutional Quality and Integrity (NACIQI) voted 9-2 against the Department’s recommendations to suspend HLC’s accrediting powers for a year. The Department said that it took issue with how HLC handled the accreditation of the Art Institute of Colorado and the Illinois Art Institute, two campuses that were transferred to the non-profit Dream Center in 2017 and 2018. Since HLC found that the schools did not meet certain eligibility criteria, HLC required the Dream Center to agree to have the schools be temporarily transferred to “pre-accredited” status, which would prevent the two schools from receiving any federal financial aid. HLC stood by its decision to transfer the status of the two schools to “pre-accredited” status. The decision now goes to Deputy Secretary of Education Mitchell Zais for review.

Consumer groups send a letter to Senate leadership expressing opposition to the Safely Back to School and Back to Work Act

On July 28, 2020, several consumer groups sent a letter to the Senate leadership expressing opposition to the Safely Back to School and Back to Work Act, which was introduced by Chairman of the Health, Education, Labor and Pensions (HELP) Committee Lamar Alexander (R-TN). The letter said that, while simplifying the Free Application for Federal Student Aid and establishing clear repayment options are worthy goals, the legislation “would actually penalize many borrowers and remove important protections, while ignoring the urgent needs for both student loan debt cancellation and, at the very least, extension and expansion of the automatic forbearance period put in place by the CARES Act.”

A copy of the letter is found at: https://younginvincibles.org/wp-content/uploads/2020/07/Response-Letter-to-Safely-Back-to-School-and-Back-to-Work-Act.pdf

ACE and other college groups send a letter to the Senate leadership urging them to extend the student loan relief provisions in the CARES Act

On July 29, 2020, the American Council on Education (ACE) and other college groups sent a letter to Senate Majority Leader Mitch McConnell (R-KY) and Minority Leader Chuck Schumer (D-NY) urging them to extend the student loan relief provisions included in the Coronavirus Aid, Relief, and Economic Security (CARES Act) until Sept. 30, 2021. “As Congress considers steps to strengthen the economy and support those adversely impacted by the pandemic, we write to ask that you include measures to help student loan borrowers by extending and expanding loan relief provisions that were provided in the CARES Act,” the letter said. “These provisions are set to expire by October of this year, yet with millions of Americans currently unemployed and the economy still struggling to recover from the pandemic, the need for relief remains and will continue into the foreseeable future.” The letter urged Congress to extend the provisions until April 2021 at a minimum, so that it is pushed past the individual income tax deadline.

A copy of the letter is found at: https://www.acenet.edu/Documents/Letter-Senate-Borrower-Relief-Extension-072920.pdf

Biden releases the fourth pillar of its Build Back Better Agenda

On July 29, 2020, Former Vice President Joe Biden released the fourth pillar of its Build Back Better Agenda to advance racial equality as part of the nation’s economic recovery. The “Achieve Equity in Management, Training, and Higher Education Opportunities Connected to the Jobs of the Future” section outlines how he would improve the higher education system:

• Include in the COVID-19 response effort an immediate cancellation of a minimum of $10,000 of federal student loan debt.
• Double the maximum value of Pell Grants and significantly increase the number of middle-class Americans who can participate in the program.
• More than half payments on undergraduate federal student loans by simplifying and increasing the generosity of the current income-based repayment program.
• Fix the Public Service Loan Forgiveness Program and forgive $10,000 of undergraduate or graduate student debt for every year of national or community service, up to five years.
• Empower the Consumer Financial Protection Bureau to act against private lenders who are misleading students about their options and do not provide an affordable payment plan when individuals are experiencing acute periods of financial hardship.
• Forgive all undergraduate tuition-related federal student debt from two- and four-year public colleges and universities and private Historically Black Colleges and Universities (HBCUs) and Minority Serving Institutions (MSIs) for debtholders earning up to $125,000.
• Provide grants to four-year public HBCUs and MSIs so they can lower the cost of attendance for low- and middle-income students, including DREAMers.
• Invest in the diverse talent at HBCUs, Tribal Colleges and Universities (TCUs), and MSIs including investing in their research capacities.
• Build the high-tech labs and facilities and digital infrastructure needed for learning, research, and innovation at HBCUs, TCUs, and MSIs. Invest $10 billion in HBCU, TCU, and MSI programs that increase enrollment, retention, completion, and employment rates.
• Expand career pathways for graduates of HBCUs, TCUs, and MSIs in areas that meet national priorities, including building a diverse pipeline of public-school teachers.
• Triple and make permanent the capacity-building and student support for HBCUs, TCUs, and MSIs in Title III and Title V of the Higher Education Act.
• Reduce disparities in funding for HBCUs, TCUs, and MSIs by requiring federal agencies and states to publish reports of their allocation of federal funding to colleges and universities.
• Provide two years of community college or other high-quality training program without debt for any person looking to learn and improve their skills.
• Tackle the barriers that prevent students from completing their community college degree or training credential by allowing students to use their Pell Grants, state aid, and other aid to help them cover expenses beyond tuition and fees.
• Make a $50 billion investment in workforce training, including community-college business partnerships and apprenticeships.
• Help develop pathways for diverse workers to access training and career opportunities, including by increasing funding for community-based and other organizations that help women and people of color access high-quality training and job opportunities.

A copy of Biden’s agenda for higher education is found at: https://joebiden.com/racial-economic-equity/#

FSA announces changes made to COD System to report students with R2T4 waivers

On July 30, 2020, Federal Student Aid (FSA) announced changes made to the Common Origination and Disbursement (COD) System to support the reporting requirements for withdrawn students who qualify for a Title IV waiver under the CARES Act. FSA plans to implement COD System functionality to support reporting requirements for the CARES Act in two phases:

• Aug. 2, 2020: The COD System will be updated to include a new Coronavirus Indicator (in the form of a checkbox). A school will use the checkbox to indicate that an aid recipient’s actual disbursement qualifies for Direct Loan cancellation (and the exclusion from the Direct Loan annual limits and Subsidized Loan usage calculations), and the exclusion from Pell LEU calculations and TEACH Grant award limits.
• Fall 2020: Additional COD System functionality will be implemented to support R2T4 waiver reporting requirements for the CARES Act, including updates to the SULA calculator and a new school report. FSA will begin passing information about disbursements marked with the Coronavirus Indicator to NSLDS.
• Fall 2020: FSA will make changes to the Return of Title IV calculator to allow schools to perform an R2T4 calculation specifically for aid recipients who withdrew due to COVID-19-related circumstances. This will provide a mechanism for reporting the amount of Title IV grant or loan assistance not returned due to the CARES Act provisions.

A copy of the FSA announcement is found at: https://ifap.ed.gov/electronic-announcements/073020AddtlCODSysImplnfoCODSysChangesSupportCARESAct

House of Representatives passes H.R. 7617, the Labor, HHS, and Education Appropriations Act

On July 31, 2020, the House of Representatives approved, by a vote of 217-197, H.R. 7617, the Defense, Commerce, Justice, Science, Energy and Water Development, Financial Services and General Government, Homeland Security, Labor, Health and Human Services (HHS), Education, Transportation, Housing and Urban Development Appropriations Act for FY 2021. On July 13, 2020, the House Appropriations Committee on Labor, Health and Human Services, Education and Related Agencies approved the Fiscal Year (FY) 2021 Labor, Health and Human Resources, Education and Related Agencies Appropriations Act, by a party vote of 30-22. No amendments were offered to the bill during the committee markup. The bill would provide $196.5 billion in discretionary funding for the Department of Labor, Department of Health and Human Services, and Department of Education, an increase of $2.4 billion over the FY 2020 enacted level and $20.8 billion over the President’s budget request. The bill would provide $73.5 billion in discretionary funding for the Department of Education, which is $716 million above last year’s level and $6.9 billion above the President’s budget request.

Some of the key education provisions include:

• $73.5 billion in discretionary funding for the Department of Education, which is $716 million above last year’s level and $6.9 billion above the President’s budget request.
• A maximum Pell Grant award at $6,495, an increase of $150 over the FY 2020 enacted level.
• $880 million for the Federal Supplemental Educational Opportunity Grant program, an increase of $15 million above the FY 2020 enacted level and $1.2 billion for Federal Work-Study, an increase of $30 million above the FY 2020 enacted level.
• Modifying the 90/10 rule, by requiring for-profit colleges to derive more of their revenue from non-federal sources (making it an 85/15 rule) and classifying all federal funds in the calculation.
• Language providing incarcerated individuals with Pell Grants at public and nonprofit institutions of higher education under certain conditions.

“This spending bill determines the critical federal investments in health, labor, human resources, and education, and builds on this subcommittee’s efforts at the center of the health and economic crises, both of which have exposed serious disparities,” said House Appropriations Subcommittee on Labor, Health and Human Services, Education and Related Agencies Chairwoman Rosa DeLauro (D-CT) in a press release.

A copy of the Committee Democrats’ press release is found at: https://appropriations.house.gov/news/press-releases/appropriations-committee-approves-fiscal-year-2021-labor-hhs-education-funding

A copy of the Committee Republicans’ press release is found at: https://republicans-appropriations.house.gov/news/press-releases/committee-republicans-object-energy-and-water-development-and-labor-health-and

Zovio to sell to the University of Arizona Global Campus

On Aug. 3, 2020, Zovio announced that it entered into an agreement to sell Ashford University, a 100 percent online university that enrolls about 35,000 students, to a new nonprofit entity called the University of Arizona Global Campus. Zovio, the publicly traded parent company of Ashford University, will support the University of Arizona Global Campus through a long-term Strategic Services Agreement.

A copy of the announcement is found at: https://www.zovio.com/media-room/zovio-and-university-arizona-announce-transformational-higher-ed-agreement

OCR announces that Title IX rules are not retroactive

On Aug. 5, 2020, the Department of Education’s Office of Civil Rights (OCR) announced in a blog post that the effective date of the Title IX rule is Aug. 14, 2020. OCR also stated that it would not enforce the new Title IX rule retroactively. The blog states that on page 127 of the Preamble to the Rule, “the Department states unambiguously that the Department will not enforce these final regulations retroactively.”

A copy of the blog is found at: https://www2.ed.gov/about/offices/list/ocr/blog/index.html

Department revises supplemental FAQs for HEERF fund

On Aug. 6, 2020, the Department of Education revised the Supplemental Frequently Asked Questions under Section 18004 of the Coronavirus Aid, Relief, and Economic Security (CARES) Act. FAQ #1 was modified to change the deadline for institutions to spend HEERF grant funds under the CARES Act to one year from the date of award in their HEERF Grant Award Notification (GAN) rather than until Sept. 30, 2022, to use the HEERF grant funds.

A copy of the revised Supplemental FAQs is found at: https://www2.ed.gov/about/offices/list/ope/caresactsupplementalfaqs63020-080630revision.pdf

President Trump signs Executive Order extending student loan relief until the end of 2020; ED implements executive order

On Aug. 8, 2020, President Trump signed an executive order suspending loan repayments and temporarily setting interest rates to 0 percent until Dec. 1, 2020, from the current expiration date of Sept. 30, 2020. As negotiations appear to remain stalled on Capitol Hill over the next round of coronavirus relief, President Trump said that he had to take immediate action to extend some of the provisions.

A copy of the Memorandum on Continued Student Loan Payment Relief During the COVID-19 Pandemic, Education, is found at:
https://www.whitehouse.gov/presidential-actions/memorandum-continued-student-loan-payment-relief-covid-19-pandemic/

Following the President’s announcement, Senate Health, Education, Labor, and Pensions Committee Chairman Lamar Alexander (R-TN) issued a statement on Aug. 8, 2020, saying that the President is doing all that he can to help workers, students, and renters “but Congress is the one who should be acting. Democrats should stop blocking common sense proposals to help students going back to school and college and parents going back to work who need childcare.”

A copy of Senator Alexander’s statement is found at: https://www.help.senate.gov/chair/newsroom/press/alexander-statement-on-executive-orders

However, House Education and Labor Committee Chairman Bobby Scott (D-VA) criticized the President’s action in a statement on Aug. 8, 2020, saying that it will be ineffective in helping students and families. “President Trump’s executive order does nothing to address the crisis facing our education system,” and “[i]t does nothing to help state and local governments avoid deep cuts to public education, which could be as high as $300 billion over the next two years. It does nothing to help schools reopen safely. It does nothing to pull our childcare system from the brink of collapse. And it does nothing to help colleges and universities keep their doors open and avoid widespread layoffs.”

A copy of Congressman Scott’s statement is found at: https://edlabor.house.gov/media/press-releases/chairman-scott-statement-on-student-loan-executive-order

On Aug. 21, 2020, the Department of Education announced that Secretary of Education Betsy DeVos had carried out the President’s Executive Order by directing the Office of Federal Student Aid (FSA) to extend the student loan relief initiated by the President in March 2020 through Dec. 31, 2020. All borrowers with federally held student loans will have their payments automatically suspended until Jan. 1, 2021, and the interest rate on all federally held student loans will be set to 0 percent through the end of the calendar year. Borrowers will continue to have the option to make payments if they choose.

In addition, the Secretary also announced that the Department would be extending many of the provisions included in the CARES Act, including the moratorium on involuntary collections, until Dec. 31, 2020, and any borrower with defaulted federally held loans whose employer continues to garnish their wages will receive a refund of those garnishments. In addition, non-payments by borrowers working full-time for qualifying employers will count toward the 120 payments required by the Public Service Loan Forgiveness program and as payments that are required to receive forgiveness under an income-driven repayment plan. The Department said that FSA is working in partnership with its federal student loan servicers to notify borrowers of this extension of loan relief measures, and the outreach effort will continue through the fall and toward eventual return to repayment.

A copy of the Secretary’s announcement is found at: https://www.ed.gov/news/press-releases/secretary-devos-fully-implements-president-trumps-presidential-memorandum-extending-student-loan-relief-borrowers-through-end-year

Later in the day, the Department of Education issued an electronic announcement announcing that it would be extending the deadline for all flexibilities to the COVID-19 emergency through the end of the payment period that includes December or the end of the payment period that includes the end date for the federally-declared emergency related to COVID-19, whichever occurs later.

Chairman Scott asks OIG to investigate the role of the Department in the misconduct of the Dream Center

On Aug. 10, 2020, Chairman of the House Education and Labor Committee Bobby Scott (D-VA) sent a letter to the Department of Education Office of Inspector General (OIG) requesting an investigation into the Department’s role in the misconduct of Dream Center Education Holdings. The request follows the House Committee on Education’s release of a report describing the Department’s role in providing funding to two schools that had lost their accreditation.

A copy of Chairman Scott’s press release, which includes a copy of his letter and the report, is found at: https://edlabor.house.gov/media/press-releases/chairman-scott-asks-department-of-education-watchdog-to-investigate-department-role-in-dream-center-misconduct

DC court denies preliminary injunction against implementing the Title IX Rule

On Aug. 12, 2020, Secretary of Education Betsy DeVos released the following statement after the U.S. District Court for the District of Columbia denied the motion for a preliminary injunction, filed by 17 state attorneys general and the District of Columbia, against the U.S. Department of Education’s new Title IX Rule slated to take effect on Aug. 14, 2020:

“Today’s ruling is yet another victory for students and reaffirms that students’ rights under Title IX go hand in hand with basic American principles of fairness and due process. With yet another failed attempt to block our historic Title IX Rule, we can now look forward to it taking effect this Friday, requiring schools to act in meaningful ways to support survivors of sexual misconduct without sacrificing important safeguards to protect free speech and provide all students with a transparent, reliable process. We can and must continue to fight sexual misconduct in our nation’s schools, and today’s ruling will help ensure that happens.”

A copy of the press release is found at: https://www.ed.gov/news/press-releases/dc-court-denies-attempt-18-attorneys-general-block-us-department-education-title-ix-rule?utm_content=&utm_medium=email&utm_name=&utm_source=govdelivery&utm_term=

ED releases summary of changes for the application processing for the 2021-2022 FAFSA

On Aug. 13, 2020, Federal Student Aid (FSA) released a summary of Changes for the Application Processing Guide for the 2021-2022 FAFSA. This includes the FAFSA and myStudentAid mobile app.

A copy of the electronic announcement is found at: https://ifap.ed.gov/electronic-announcements/081320SumofChangesfortheAppProcesSystemGuide202122

ED launches new Title IX resources for students and institutions

On Aug. 14, 2020, the Secretary of Education launched new resources to help students and institutions understand the new Title IX rules that went into effect on Aug. 14, 2020. The Secretary said: “Today marks a new era in the storied history of Title IX in which the right to equal access to education required by law is truly protected for all students.”

The Department launched a new website that provides a one-stop resource for key information on the Title IX rules, which is found at: https://sites.ed.gov/titleix/?utm_content&utm_medium=email&utm_name&utm_source=govdelivery&utm_term

A copy of the Secretary’s press release is found at: https://www.ed.gov/news/press-releases/us-department-education-launches-new-title-ix-resources-students-institutions-historic-new-rule-takes-effect

ED announces creation of the Partner Eligibility and Oversight Services Document Center

On Aug. 14, 2020, the Department of Education announced the creation of the Partner Eligibility and Oversight Services (PEOS) Document Center as promised at the 2019 Federal Student Aid (FSA) Training Conference. The new Document Center is part of ED’s ongoing efforts to improve its partners’ experience with managing the federal student aid programs. The new Document Center is a centralized electronic repository of documents that allows school users and affiliated third-party servicers to electronically upload program compliance documents. Program compliance documents are documents that support the five core business processes of PEOS: eligibility and certification, audit resolution, program review, financial analysis, and method of payment.

To assist its partners with using the new Document Center, ED announced the availability of an online training module. The Partner Eligibility and Oversight Services Document Center training module is available on the IFAP website’s Media Files (Podcast) page https://ifap.ed.gov/ilibrary/document-types/podcast.

A copy of the electronic announcement is found at: https://ifap.ed.gov/electronic-announcements/081420NewDocumentCtr4ProgramComplianceDocuments

Three Senators urge HHS and CDC to coordinate with state and local health officials to ensure complete data on COVID-19 cases linked to institutions of higher education is collected

On Aug. 19, 2020, three Senators, Elizabeth Warren (D-MA), Chris Murphy (D-CT), and Tina Smith (D-MN), sent a letter to the Department of Health and Human Services (HHS) and Centers for Disease Control and Prevention (CDC) urging them to coordinate their data collection efforts on COVID-19 with state and local health officials to ensure complete, transparent, and timely national reporting of COVID-19 cases linked to institutions of higher education. They note that as colleges and universities start their new academic year, “there is no national method for reporting and tracking COVID-19 cases at these institutions.” The letter suggested: “While the CDC’s guidance for colleges and universities encourages coordination with local health officials in accordance with applicable privacy laws, it does not specify a standardized format or level of detail for reporting cases or the frequency with which cases should be disclosed to the public. This lack of guidance is likely to create a patchwork of inconsistent information across states, localities, and the nation, undermining transparency and efforts to address the pandemic.” The Senators suggested that HHS, CDC, and state and local public health departments should work together to collect the data in a standardized format from institutions of higher education.

A copy of the letter is found at: https://www.warren.senate.gov/imo/media/doc/2020.08.19%20Letter%20to%20HHS.CMS%20re%20college%20COVID%20data%20.pdf

ED revises the eZ-Audit templates to accommodate the new financial responsibility provisions

On Aug. 20, 2020, the Department of Education announced that it completed the revisions to the eZ-Audit templates to accommodate the new Financial Responsibility provisions as it announced on April 9, 2020.

A copy of the revised electronic announcement is found at: https://ifap.ed.gov/electronic-announcements/040920FinancialResponsibilityQuestionsAnswers

ED announces that it is extending the deadline for all flexibilities related to the COVID-19 emergency

On Aug. 21, 2020, the Department of Education issued an electronic announcement announcing that it would be extending the deadline for all flexibilities related to the COVID-19 emergency through the end of the payment period that includes Dec. 31, 2020, or the end of the payment period that includes the end date for the federally-declared emergency related to COVID-19, whichever occurs later. The announcement stated that the Department outlined the initial flexibilities in electronic announcements published on March 5, April 3, May 15, July 9, and July 10, 2020.

Exceptions to the general deadline include campus-based matching requirements, leave of absences, return of Title IV funds, foreign institutions, academic calendars, and reporting and audit requirements.

A copy of the electronic announcement is found at: https://ifap.ed.gov/electronic-announcements/082120UpdatedDeadlinesFlexReltoCOVID19

ED announces change in reporting fraud rings to the OIG

On Aug. 21, 2020, the Department of Education informed the higher education community of a change in how to report fraud rings to the Office of Inspector General (OIG). The OIG fraud ring email address is no longer in use and will be disabled. Institutions must now submit fraud ring complaints through the Department’s OIG encrypted complaint web portal at the URL address https://oighotlineportal.ed.gov. The OIG has also modified the spreadsheet used to report fraud rings and attached the updated Fraud Ring Reporting Spreadsheet to the electronic announcement.

A copy of the electronic announcement is found at: https://ifap.ed.gov/electronic-announcements/082120FraudPostsecondaryDistanceEdPrgmsfraudringsRptgChange

ED publishes final distance education rules

On Aug. 24, 2020, the Department of Education announced it will be publishing final regulations on distance education and innovation. The final rule is largely the same as the notice of proposed rulemaking published on April 2, 2020, although a few adjustments were made based on public comments. The Department received 237 comments from the public, most of which were supportive of the proposed rule. The regulations will take effect on July 1, 2021, but institutions will have the ability to voluntarily utilize the new flexibilities as soon as the rule is officially published in the Federal Register.

Secretary of Education Betsy DeVos said:

“While we moved quickly at the start of the pandemic to provide temporary distance learning flexibilities for students, these new regulations provide a permanent upgrade to online and competency-based education … The COVID-19 pandemic has shown that a video call is not enough, and our outdated rules did not comport with 21st-century realities. These regulations are a true ‘rethink’ of what is possible for students so that they can learn in the ways and places that work best for them.”

A copy of a Fact Sheet summarizing the rule is found at: https://www2.ed.gov/policy/highered/reg/hearulemaking/2018/distanceandinnovationfactsheet.pdf

The unofficial copy of the final rule is found at: https://www2.ed.gov/policy/highered/reg/hearulemaking/2018/distanceandinnovationunofficialreg.pdf

A copy of the Secretary’s announcement is found at: https://www.ed.gov/news/press-releases/secretary-devos-issues-new-distance-learning-regulations-spur-high-quality-distance-and-competency-based-programs-better-serve-diverse-population-higher-education-students

SHARON H. BOB PH.D., Higher Education Specialist on Policy and Regulation, is a member of the Education Group at the Washington, DC law firm of Powers Pyles Sutter & Verville, PC. Dr. Bob advises all sectors of higher education regarding strategic issues pertaining to their participation in the federal student financial assistance programs, accreditation, licensure, education tax benefits, and related regulatory matters.