Neg Reg – What is it and How Can You Participate? Phil Van Horn – WSLC Janet Dodson - NSLP

2 It’s the law! The neg reg process is mandated by law for Title IV programs, as well as for many of the key compliance and reporting sections of the law, including accreditation. For more information on negotiated rulemaking in general, visit

3 Neg Reg exceptions While Neg Reg is mandated it may be eliminated when the Secretary decides: –it would be impractical; or –it would not be in the public’s best interest; or –it is deemed unnecessary Additionally, if changes are considered “self-implementing” the Secretary may decide to bypass Neg Reg

4 What is Neg Reg? A process used by many federal agencies to develop and revise regulations A group of participants representing various sectors of the financial aid community meet with ED representatives to reach consensus on the language of a proposed rule –typically ED tries to select members of the non- federal team from sectors most impacted by the regulatory changes

5 What is Neg Reg? ED may use that language as a basis for its proposed rule, which will be published, along with a request for public comments, following the conclusion of the Neg Reg sessions

6 Why Neg Reg? Typical negotiated rulemaking sessions following major legislation identify large numbers of issues The Neg Reg process after the 1998 reauthorization identified more than 100 separate issues that were ultimately regulated

7 Why Neg Reg? More recent Neg Reg processes, following HERA and CCRAA have been more limited, although both the HERA and CCRAA processes involved multiple committees Neg Reg on HEOA is more likely to follow the 1998 model, with a large number of issues on the agenda

8 What is happening now? During the last few weeks, ED held a series of four regional hearings to solicit issues to be considered in developing an agenda for Neg Reg Stay tuned!

9 Committee members Committees typically involve primary members representing the major actors in the affected industry Additionally, alternate negotiators are usually appointed as well from the same broad areas as the primary negotiators

10 Committee members As an example, 26 total negotiators were selected for the 2007 student loan related negotiations, representing the major participants (lenders, servicers, guarantors) as well as institutions and related associations

11 Neg Reg agenda Agenda items traditionally are chosen on the premise that they can be resolved within the bounds of regulations –Neg Reg does not address items requiring statutory change –typically, ED chose issues for the agenda that are likely to be successfully negotiated — that is, that stand a good chance of reaching consensus

12 The statutes The Higher Education Act of 1965, as amended Recent laws that have affected Title IV programs include: –Bankruptcy Code –E-signature Law –Gramm-Leach Bliley –Service-member’s Civil Relief Act –Fair Credit Reporting Act

13 Legislative process Authorizing committees –request proposals –hold hearings –draft proposed legislation –debate proposals –approve bill for submission to respective house Full House and Senate –debate proposed law –pass their version of bill –appoint conference committee member Conference committee –reconcile bills –votes on final language –refers final language to houses

14 Legislative process Full House and Senate –debate proposed law –floor amendments –pass final legislation –enrolled bill –sent to President President signs into law Secretary implements

15 Secretary of Education’s responsibilities Advise Congress –propose legislation –provide technical assistance –assist with constituent issues Regulates where needed Enforces law and regulations Communicates with interested parties and the public

16 Areas that require Neg Reg Code of Federal Regulations Chapter 34 (34 CFR) Part 86 - DRUG-FREE SCHOOLS Part 99 - FAMILY EDUC RIGHTS AND PRIVACY (FERPA) Part INSTITUTIONAL ELIG. Part ACCREDITING AGENCIES Part STATE AGENCIES Part GENERAL PROVISIONS Part GEN PROVISIONS Campus Based Programs Part FEDERAL PERKINS LOAN Part FEDERAL WORK- STUDY Part FEDERAL SEOG Part FFEL Part FEDERAL DIRECT LOAN Part FEDERAL PELL GRANT Part LEAP/Special LEAP (SSIG) Part GEAR UP (NEISPP)

17 Important Neg Reg concepts Goal: to develop Notices of Proposed Rulemaking (NPRM) that reflect a final consensus of the negotiating committee Consensus: there must be no dissent by any member for the committee to have reached consensus

18 The process Secretary delegates responsibility to staff Secretary holds meetings to consider proposed topics Secretary proposes topics Meetings with interested parties to discuss Neg Reg process Solicit nominations for Neg Reg non- federal members Select non-federal members

19 The process Committee approves protocols Committee finalizes agenda topics ED submits thoughts and ideas Committee reacts Negotiations begin ED provides draft regulatory language Negotiations continue Consensus reached –NPRM regulatory language published as agreed No consensus reached –Secretary publishes without regard to negotiations

20 Rulemaking steps ED writes preambles Internal review of NPRM package –Deputy Secretary –OMB –budget implications –OPE approval –SFA approval

21 Rulemaking steps Neg Reg committee reviews preamble ED may make changes to preamble Secretary’s approval NPRM published –submitted to the Federal Register –posted to IFAP –30-90 day comment period ED

22 Rulemaking steps ED reviews comments ED decides on changes ED writes analysis of comments and changes, if any Internal approval (same as for NPRM) Submits for publication in the Federal Register - publish by November 1 Final rule effective usually following July 1

23 Organizational protocols Mission statement Participation Committee members –principal spokesperson & alternate –non-member invitations –adding members –subcommittees

24 Organizational protocols Decision making Consensus –“...there must be NO dissent by ANY member in order for the committee to be considered to have reached agreement.” –“members should not block or withhold consensus unless they have serious reservations….” –“absence will be equivalent to not dissenting” –“all consensus agreements… will be assumed to be tentative… until members… agree to make them final agreements”

25 Organizational protocols Agreement Goal: to develop one or more NPRMs that reflect a final consensus of the committee The Department will not alter the consensus based language of its NPRMs UNLESS it reopens the neg reg process or provides a written explanation to the committee members in advance of the publication of the NPRM. If there is a change, Committee members may comment positively or negatively.

26 Organizational protocols Agreement If the committee reaches consensus, ED will use the consensus language in the NPRMs Committee Members WILL REFRAIN from commenting negatively on the consensus language, unless it has something new to contribute (not previously considered or new information) –Note: If NASFAA is a negotiator, and consensus is achieved, NASFAA cannot comment

27 No consensus? What if consensus is not achieved? ED is permitted to publish proposed regulations using language that they believe adequately addresses the issue Negotiators are permitted to comment positively or negatively

28 Organizational protocols Committee meetings –clear and reliable record –distribution of materials at least seven days in advance –caucus for consultation –agendas –all meetings, except caucuses, are public

29 Organizational protocols Safeguards for members –any member may withdraw at any time –all members shall act in good faith –contact with the press is generally limited to discussion of overall objectives and progress Meeting facilitation –facilitators serve at the discretion of committee

30 Carved out sections The department can choose to “carve out” sections of the NPRMs, either taking sections out of discussion completely or moving them into a separate discussion

31 How can you have input? Attend a regional ED meeting Volunteer to be a negotiator Provide input to your associations Respond to NPRMs when published

32 Neg Reg experiences FFEL team member Phil Van Horn TEACH Grant team member Janet Dodson