1. NEGOTIATED RULEMAKING Joe Weglarz Executive Director, Student Financial Services Marist College

2. About Marist College Founded in 1929 Located in New York’s historic Hudson Valley Branch located in Florence, Italy Enrollment 2014-2015 4,746 Traditional Undergraduate 1,359 Graduate and Adult ● Marist ● NYC ● Albany

3. Agenda Overview Organizational Protocols Sessions Committee Issues Updates Participation Conclusion

4. Agenda Overview Mission Statement History of Negotiated Rulemaking Process Organizational Protocols Sessions Committee Issues Updates Participation Conclusion

5. Overview Mission Statement The U.S. Department of Education established the negotiated rulemaking committee to develop proposed student financial assistance regulations pursuant to Sec. 492 of the Higher Education Act of 1965, as amended (HEA). “One of the unique attributes of higher education policymaking at the Department is the use of the negotiated rulemaking process. Under this process, the Department works to develop a Notice of Proposed Rulemaking, or ‘NPRM,’ in collaboration with representatives of the parties who will be affected by the regulations.” Jamienne Studley, Deputy Under Secretary of Education

6. Overview History of Negotiated Rulemaking 1970s- - Idea became popular under the Ford presidency 1980- Members of Congress began introducing legislation to encourage the use of negotiated rulemaking (“neg reg”) 1990- Negotiated Rulemaking Act enacted by Congress 1992- HEA Amendments mandated negotiated rulemaking for Title IV programs 1993- First negotiations were held regarding program integrity

7. Overview Process Publish intent to establish neg reg committee in Federal Register Obtain feedback through public hearings/ written comments Nominate negotiators & convene meetings Publish Notice of Proposed Rulemaking (NPRM) Review feedback from public Publish final regulations in Federal Register

8. Agenda Overview Organizational Protocols Committee Meetings Participation Decision Making & Agreement Safeguards for Members Sessions Committee Issues Updates Participation Conclusion

9. Organizational Protocols Committee Meetings Typically include 12-15 negotiators with an alternate for each & at least one Department representative Federal agencies must usually limit negotiators to 25 members Usually consist of 3 sessions at monthly intervals Each session typically lasts for 3 days Meetings are facilitated by a neutral third party

10. Organizational Protocols Participation Negotiate program integrity and improvement Subcommittees may be formed by the committee to address specified issues Specialists may be invited by the committee to participate The Secretary may remove a member for not acting in good faith

11. Organizational Protocols Decision Making & Agreement Goal is to develop a Notice of Proposed Rulemaking (NPRM) that reflects final consensus Committee operates by unanimous consensus on all issues Department uses consensus-based language in its NPRM Committee members and organizations they represent must refrain from commenting negatively when consensus is reached Public may comment on published NPRM by specified deadline Department of Education determines whether to proceed with regulations if consensus is not reached

12. Organizational Protocols Safeguards for Members Any member may withdraw from negotiations at any time without prejudice, by notifying the facilitator(s) in writing Contact with the media or other organizations outside the community of interest represented by the member are generally limited to discussion of overall objectives and progress of negotiations

13. Agenda Overview Organizational Protocols Sessions Committee Issues Updates Participation Conclusion

14. Sessions Negotiated Rulemaking 2013-2014- Program Integrity & Improvement US Department of Education, Washington, DC February 2014 Overview of process and issues; review and adopt protocols March 2014 Review 6 issues and proposed regulatory language April 2014 Discussed 4 topics in further detail: State Authorization of Distance Education, State Authorization of Foreign Locations, Cash Management & PLUS Adverse Credit May 2014 Fourth session added to focus on defining “adverse credit” for PLUS borrowers Reviewed final 3 pending issues: PLUS Adverse Credit, State Authorization of Distance Education, Cash Management Call for consensus on full package Final Consensus was NOT Reached

15. Agenda Overview Organizational Protocols Sessions Committee Institutions Other Non-Federal Members Issues Updates Participation Conclusion

16. Committee Institutions Negotiated Rulemaking 2013-2014- Program Integrity & Improvement Minority ServingBenedict College Miles College Public, two-yearSanta Barbara City College Montgomery College Public, four-yearClemson University George Mason University Private, non-profitMIT Marist College Private, for-profitCapella University American Career College

17. Committee Other Non-Federal Members US Public Interest Research Group ( representing students ) Legal assistance organizations Consumer advocacy organizations Institutional third-party servicers Distance education Business and industry Lenders, community banks, credit unions Accrediting agencies State attorneys general/ state officials

18. Agenda Overview Organizational Protocols Sessions Committee Issues Updates Participation Conclusion

19. Issues Issue 1: Clock to Credit Hour Conversion Issue 2: State Authorization of Distance Education Issue 3: State Authorization of Foreign Locations of Domestic Institutions Issue 4: Cash Management Issue 5: Retaking Coursework Issue 6: PLUS Adverse Credit

20. Issues Cash Management Concern that regulations may not adequately reflect current technologies Revisited allowable timeframes, methods and procedures for paying Title IV credit balances Discussed additional safeguards for procedures that utilize debit/ prepaid cards Emphasis on ensuring safe, convenient & free access to full credit balances Some students have incurred excessive fees Suggested regulating the marketing of financial products offered to students for credit balances

21. Issues Retaking Coursework Discussed if regulations on retaking coursework should apply only to undergraduates Department issued guidance indicating regulations do not apply to graduate/ professional programs, but regulations unclear Addressed whether students should be permitted to repeat an entire term if they fail one course Would apply to programs that require students to retake an entire term to academically progress

22. Issues PLUS Adverse Credit Regulations governing adverse credit history had not been updated since Direct Loan Program was established in 1994 PLUS applicant was considered to have adverse credit if: 90 days or more delinquent on any debt Default, bankruptcy discharge, foreclosure, repossession, tax lien, wage garnishment or Title IV write-off within last 5 years After Congress mandated all new loans be processed through the Direct Loan Program in 2010, the Department discovered PLUS approvals despite debts in collection or charged off By November 2011, Department aligned practice with regulation but did not clearly communicate the change Called attention to the need to reevaluate policy

23. Agenda Overview Organizational Protocols Sessions Committee Issues Updates Notice of Proposed Rulemaking PLUS Loan Program Changes Participation Conclusion

24. Updates Notice of Proposed Rulemaking (NPRM) Department planned to publish proposed regulations resulting from 13-14 negotiated rulemaking in 2 separate NPRMs NPRM regarding proposed PLUS loan adverse credit history was published on August 8, 2014 Final Regulations published in the Federal Register on Oct 23, 2014 Early implementation began March 29, 2015 NPRM regarding cash management published May 2015 Anticipate final rule to be released by November 2015

25. Updates PLUS Loan Program Changes Credit check approval now valid for 180 days (from 90) PLUS borrowers are no longer considered to have adverse credit if their total combined delinquent debt is $2,085 or less Threshold will adjust based on inflation, as measured by the Consumer Price Index (CPI) Debt is delinquent if 90 or more days past due as of the date of the credit report or if in collection or charged off during the past 2 years PLUS borrowers approved with an endorser or after an appeal must now complete PLUS Loan Counseling

26. Agenda Overview Organizational Protocols Sessions Committee Issues Updates Participation Conclusion

27. Participation Familiarize yourself with Notice of Proposed Rulemaking (NPRM) and provide feedback Link to the Federal eRulemaking Portal included in the NPRM Attend and engage at public hearings conducted throughout the U.S. Contact individuals representing your constituency Outreach to volunteer Significant time commitment If selected, be prepared to learn a lot and have fun!

28. Agenda Overview Organizational Protocols Sessions Committee Issues Updates Participation Conclusion

29. Great learning experience Allows for a better understanding of how regulations are developed and approved Excellent networking opportunity Need support of staff and institution Do more than belong: participate. Do more than care: help. Do more than believe: practice…Do more than dream: work. - William Arthur Ward