NCHER Legislative Conference Washington, DC Federal Update February 2, 2016 Annmarie Weisman, Office of Postsecondary Education

Regulatory Update

RECENT REGULATORY EFFORTS  “Revised” Pay As You Earn (REPAYE)  Program Integrity and Improvement (Cash Management) (COMPLETED) 3

RECENT REGULATORY EFFORTS  “Revised” Pay As You Earn (“REPAYE”)  Feb. - April, 2015: Negotiations held  Consensus reached on a Revised Pay As You Earn repayment plan (REPAYE) – extends 10% income cap to all borrowers regardless of when they borrowed – Repayment period = 20 years for undergraduate loans and 25 years if graduate loans included  PAYE still available; not a replacement plan  October 30, 2015: Final regulations published  Dec. 2015: Early implementation (COMPLETED) 4

RECENT REGULATORY EFFORTS  Program Integrity and Improvement (Cash Management)  October 30, 2015: Final regulations published  July 1, 2016: Regulations effective  Ensure that students receiving Title IV, HEA funds: – Have convenient access to their funds – Do not incur unreasonable financial account fees – Are not led to believe they must open a particular financial account to receive their funds (COMPLETED) 5

RECENT REGULATORY EFFORTS  Borrower Defenses to Repayment  Sept. 2015: Public hearings – DC, San Francisco  Oct. 20, 2015: Published Federal Register Notice – requested negotiator nominations – Announce dates of committee meetings  Nov. 19, 2015: Negotiator nominations due  Dec. 21, 2015: 2 nd FR Notice requesting negotiators  Dec. 28, 2015: Additional nominations due (IN PROGRESS) 6

RECENT REGULATORY EFFORTS  Borrower Defenses to Repayment  Negotiation sessions: – Session 1: January 12-14, 2016 – Session 2: February 17-19, 2016 – Session 3: March 16-18, 2016  Expect to publish proposed rules this summer  Expect to publish final rules by November 1, 2016 (IN PROGRESS) 7

RECENT REGULATORY EFFORTS  Borrower Defenses to Repayment (*etc.)  Tentative issues for discussion; finalizing issues in Feb. – Procedures for a borrower to establish a defense to repayment – Criteria to identify acts or omissions of an institution that constitute defenses to repayment – Standards and procedures that ED will use to determine school liability from borrower defenses – Effect of borrower defenses on institutional administrative capability assessments (financial responsibility) (IN PROGRESS) 8

RECENT REGULATORY EFFORTS  Borrower Defenses to Repayment (*etc.)  Other potential issues for discussion  Finalizing issues in February – False Certification* – Electronic Death Certificates* – Nurse Faculty Loans in Consolidation Loans* – Interest Capitalization* – REPAYE Technical Corrections* – Collection Costs* (IN PROGRESS) 9

RECENT REGULATORY EFFORTS  Borrower Defenses to Repayment  Rulemaking website: (IN PROGRESS) 10

Administration Priorities

ADMINISTRATION PRIORITIES  By 2020, America will once again have the highest proportion of college graduates in the world.  Themes: – Increasing access – Making college more affordable – Improving outcomes PRESIDENT’S 2020 GOAL 12

ADMINISTRATION PRIORITIES  Student Aid Bill of Rights  Income-Driven Repayment Plans  Pay As You Earn (PAYE)  Revised Pay As You Earn (REPAYE) INCREASING AFFORDABILITY – BACK END STRATEGIES 13

ADMINISTRATION PRIORITIES  Student Aid Bill of Rights  Protects Social Security benefits of borrowers with disabilities who may qualify for a loan discharge or other repayment options  Ensures a fair, transparent, and reasonable debt collection process for defaulted Federal student loans  Compensation of collection agencies, guidance provided to collection agencies, ensuring accurate information provided INCREASING AFFORDABILITY – BACK END STRATEGIES 14

Affordability: Student Aid Bill of Rights

ADMINISTRATION PRIORITIES  Pay As You Earn (PAYE)  Caps payments for Federal Direct Student Loans at 10% of discretionary income for eligible borrowers  Benefits:  Helps borrowers to manage their debt  Helps borrowers to avoid default  Provides relief on loan payments, especially in the early years of repayment  Complements other repayment plans INCREASING AFFORDABILITY – BACK END STRATEGIES 16

ADMINISTRATION PRIORITIES  “Revised” Pay As You Earn “REPAYE”  Feb. - April, 2015: Negotiations held  Consensus reached on a Revised Pay As You Earn repayment plan (REPAYE) – extends 10% income cap to all borrowers regardless of when they borrowed – Repayment period = 20 years for undergraduate loans and 25 years if graduate loans included  PAYE still available; not a replacement plan  October 30, 2015: Final regulations published  Dec. 2015: Early implementation INCREASING AFFORDABILITY – BACK END STRATEGIES 17

Contact Information Annmarie Weisman, Director, Policy Coordination Group Office of Postsecondary Education Phone: (until Feb. 26, 2016) Phone forwarded for 60 days ED directory available afterward