1. MASFAA Government Relations Committee Christine McGuire, Boston University Bernard Pekala, Boston College

2. February 8, 2006 President Bush signed the Higher Education Reconciliation Act of 2005 (the “HERA”), Pub. L. 109 171, which made significant changes to the Higher Education Act of 1965, as amended (the “HEA”), and reauthorized the Federal Family Education Loan (FFEL) Program. Negotiated Rulemaking Required by the Department Finished in April without consensus on the whole package of regulations.

3. Student Lending Accountability, Transparency and Enforcement Act (SLATE) Mirrors codes of conduct embedded in agreements entered into between NY Attorney General, lenders and institutions.

4. Final Regulations (Federal Register, November 1, 2007)  Preferred Lender Lists must contain at least three unaffiliated lenders.  No lender who offers the institution any benefits may be on a PLL.  Must be reviewed & updated annually.  Lenders may not automatically be assigned through award packaging for first time borrowers.

5. Final Regulations (Federal Register, November 1, 2007)  Institution must disclose – method and criteria for selecting lenders – Comparative information about interest rates and other benefits offered by lenders – That students are not required to use lenders on the list

6. Final Regulations (Federal Register, November 1, 2007)  Lenders are prohibited from – Any philanthropic activities, in return for being placed on a PLL – Paying costs of aid administrators attending conferences, or for entertainment at lender- sponsored events – Conducting in person entrance or exit counseling – Soliciting a school employee to serve on an advisory board and paying for costs associated with serving on an advisory board

7. Final Regulations (Federal Register, November 1, 2007)  Lenders are permitted to – Offer in-person financial literacy to students. – Provide short term staffing on an emergency, non-recurring basis. – Pay for meals, refreshments, and receptions that are reasonable in cost if scheduled on conjunction with a training, meeting or conference open to all attendees.

8. Higher Education Opportunity Act (HEOA) of 2008 Added a new Title to the Higher Education Act Title X: Private Student Loan Improvement o Specific legislation regarding non-federal educational loans o Connected the Higher Education legislation to the “Truth in Lending Act”

9. Higher Education Opportunity Act (HEOA) of 2008 Title X: Private Loans Defines a “gift” as: “means or gratuity, favor, discount, entertainment, hospitality, loan or other item having more than a de minimis monetary value, including services, transportation, lodging, or meals, whether provided in kind, by purchase of a ticket, payment in advance, or reimbursement after the expense has been incurred.

10.  Defines a “gift” not to include: – Standard informational material related to a loan, default aversion, default prevention or financial literacy – Food, refreshments, training, or informational material furnished as part of a training session or through participation in an advisory council Higher Education Opportunity Act (HEOA) of 2008 Title X: Private Loan

11.  Defines a “gift” not to include: – Philanthropic contributions to a covered educational institution from a private educational lender that are unrelated to private education loans Higher Education Opportunity Act (HEOA) of 2008 Title X: Private Loans

12. Prohibits certain gifts and arrangements – A lender may not directly or indirectly:  Offer gifts in exchange for an advantage or consideration for private education loan activities  Engage in revenue sharing Higher Education Opportunity Act (HEOA) of 2008 Title X: Private Loans

13. Co-Branding: A private educational lender many not use the name, emblem, mascot or logo of the institution, in the marketing of the loan Advisory Board Compensation: However, allows for the reimbursement of reasonable expenses incurred as part of service on an advisory board Higher Education Opportunity Act (HEOA) of 2008 Title X: Private Loans Prohibits:

14. Prepayment or Repayment fees or penalites: Makes it unlawful for any private educational lender to impose a fee or penalty on a borrower for early repayment or prepayment of any private education loan. Higher Education Opportunity Act (HEOA) of 2008 Title X: Private Loans Prohibits:

15. What approach should schools be taking regardless of whether DL or FFELP? Articulate clear policies regarding:  Institutional gift policy  Conflict of interest policy  Disclose the process for evaluating the lenders or loans recommended, regardless of Federal or private credit

16. Campus Considerations Options??  No lists  Partial lists  UG Only  Grad Only  By Program  By School  FFELP  Private

17. Campus Considerations Options??  How many on the list  List Types  Inclusive (All)  Volume  Benefit

18. Campus Considerations Information Collection Options??  Request For Proposals  Request For Information

19. MASFAA’s RFI Template MASFAA Government Relations Committee provided a packet of templates and information in February 2008. The professional information was intended as a best practice sharing of information NOT intended to be used “as is” The templates should have been modified for your campus Use of these materials provides no assurance of complete compliance

20. MASFAA’s RFI Template  External  Cover Letter  RFI  Savings Answer Sheet  Internal  RFI Comparison Matrix  Savings Worksheet  Disclosure  Web  Paper

21. MASFAA’s RFI Template FEEDBACK TIME:  If you used them, what are your positive and negative comments  Should we revise for 2009?  Should we issue a private loan version?  If you didn’t use them, why not?  Would you have if they had been different? Approximately 20 schools used the templates as indicated on the MASFAA listserv.

22. DISCUSSION and QUESTIONS