Washington News Brief
By Sharon H. Bob, Ph.D., Higher Education Specialist, Powers Pyles Sutter and Verville, PC
Senate Democrats urge DeVos to name head of Student Enforcement Unit
On Aug. 7, 2017, Senators Sherrod Brown (D-OH), Patty Murray (D-WA), Elizabeth Warren (D-MA), and Richard Durbin (D-IL) sent a letter to Secretary of Education Betsy DeVos and Chief Operating Officer of Federal Student Aid Dr. A. Wayne Johnson urging them to name a “credible, well qualified, independent, and permanent Chief Enforcement Officer for the Department’s Student Aid Enforcement Unit. The Student Aid Enforcement Unit was originally established in early 2016 under the Obama administration to investigate unfair, deceptive, and fraudulent practices of some colleges and universities. In order to ensure a fair and transparent process for hiring a Chief Enforcement Officer, the Senators sought answers to a number of questions, including the minimum qualifications required of an individual seeking the position, to which political appointee does the Student Aid Enforcement Unit report to, and how many referrals for investigation are currently pending.
A copy of the letter is found at: https://www.help.senate.gov/imo/media/doc/Chief%20Enforcement%20Officer%20Letter%208.7.17%20.pdf
President Trump signs GI Bill expansion into law
On Aug. 16, 2017, President Trump signed into law H.R. 3218, the Harry W. Colmery Veterans Educational Assistance Act (also known as the Forever GI Bill). (P.L. 115-48) On Aug. 2, 2017, the Senate, by unanimous vote, passed S. 1598, the companion bill to H.R. 3218, which passed the House on July 24, 2017, by a vote of 405 to 0. H.R. 3218 would modernize and strengthen veterans’ education benefits. The bill includes a range of benefits that veterans groups have long sought, such as eliminating the 15-year time limit to use the GI Bill benefits and restoring the GI Bill educational benefits of student veterans who were affected by the closures of Corinthian Colleges and ITT Tech.
On Aug. 16, 2017, Secretary of Education Betsy DeVos and Secretary of Veterans Affairs David Shulkin issued a joint statement that said: “This important legislation will give countless veterans and their families greater access to the education and workforce training they deserve. It will provide them the opportunity to invest in their futures with fewer restrictions and time limitations.”
A copy of the Senate summary is found at: https://www.veterans.senate.gov/imo/media/doc/07-17-17%20Final%20SVAC%20GI%20Bill%20One%20Pager.pdf
A copy of the text of H.R. 3218 is found at: https://www.congress.gov/bill/115th-congress/house-bill/3218/text?q=%7B%22search%22%3A%5B%22H.R.+3218%22%5D%7D&r=1
A copy of the statement is found at: https://www.ed.gov/news/press-releases/secretaries-devos-and-shulkin-statement-harry-w-colmery-veterans-educational-assistance-act-2017
Senator Warren requests information on Senior Counselor at ED
On Aug. 15, 2017, Senator Elizabeth Warren (D-MA) sent a letter to Secretary of Education Betsy DeVos requesting information on the ethics rules that apply to Robert Eitel, a Senior Counselor to the Secretary. Mr. Eitel is a former executive of Bridgepoint Education. Senator Warren said in the letter: “I have repeatedly sought information from the Department on the nature of Mr. Eitel’s involvement with borrower defense regulations and the timeline of his involvement, but you have so far failed to provide me with this information.”
A copy of Senator Warren’s letter is found at: https://www.warren.senate.gov/files/documents/2017_08_15_DeVos_letter_Eitel_conflicts.pdf
House and Senate Democrats send letter to Secretary DeVos expressing opposition to the decision to delay GE disclosures to prospective students
On July 26, 2017, 59 House and Senate Democrats sent a letter to Secretary of Education Betsy DeVos expressing their opposition to the Department of Education’s decision to delay the distribution of the gainful employment disclosures to prospective students. The letter urges the Secretary to “reverse course and allow the gainful employment disclosure rules to go into effect immediately.” The lawmakers acknowledged that the Department is currently in the process of rewriting the gainful employment rules and said that: “if the Department wishes to alter current gainful employment regulations, it is free to do so through a new negotiated rulemaking process – even though we oppose any action that would revise the regulation in ways that harm students and taxpayers.”
A copy of the letter is found at: https://www.help.senate.gov/imo/media/doc/072617-%20Bicam%20Dem-DeVos%20GE%20Delay%20Letter.pdf
Senators introduce Know Before You Owe Act
On July 25, 2017, Senators Chuck Grassley (R-IA), Joni Ernst (R-IA) and Al Franken (D-MN) introduced S. 1628, Know Before You Owe Act, which would increase the amount of information that students are required to receive about their federal student loans. The bill would add several components to the information that institutions are required to share with students as part of loan counseling, including their potential to repay, a statement that the student should borrow the minimum amount necessary to cover expenses and that the student does not have to accept the full amount of loans offered, options for reducing borrowing, an explanation of the importance of graduating on-time to avoid additional borrowing, what course load is necessary to graduate on-time, and information on the impact of adding an additional year of study to total indebtedness. The counseling requirements would be strengthened by making counseling an annual requirement before new loans are disbursed rather than just for first-time borrowers.
A copy of the press release is found at: https://www.grassley.senate.gov/news/news-releases/grassley-ernst-franken-introduce-know-you-owe-federal-student-loan-act-2017
ED announces public hearings to solicit input on which regulations should be rolled back
On Aug. 25, 2017, the Department of Education published a Notice in the Federal Register, announcing that it will hold two public hearings to solicit input on Department regulations and guidance specific to postsecondary education programs that may be appropriate for repeal, replacement, or modification. The Department has been accepting comments as part of its agency-wide Task Force aimed at identifying regulations that may be modified or repealed. The hearings will be held on Sept. 26, 2017 at Salt Lake Community College and on Oct. 4, 2017 at the Department of Education in Washington, DC.
A copy of the Notice is found at: https://www.gpo.gov/fdsys/pkg/FR-2017-08-25/pdf/2017-18104.pdf
Department adjusts deadlines for alternate earnings appeals under gainful employment
On Aug. 18, 2017, the Department of Education issued a Notice in the Federal Register announcing new deadlines for submitting notices of intent to file alternate earnings appeals and for submitting alternate earnings appeals. The Department also announced additional information that will be considered when evaluating alternate earnings appeals. The deadline to file a notice of intent to file an alternate earnings appeal is Oct. 6, 2017 and the deadline to file the alternate earnings appeal is Feb. 1, 2018. Electronic Announcement #108 was also released on Aug. 18, 2017 advising the higher education community of the Federal Register Notice regarding the appeals deadlines.
A copy of the Notice is found at: https://www.gpo.gov/fdsys/pkg/FR-2017-08-18/pdf/2017-17423.pdf
A copy of the Electronic Announcement is found at: https://ifap.ed.gov/eannouncements/081817GEEA108AnnouncementofAppealsDeadlines.html
Sept. 17, 2017 – Constitution Day
Sept. 17, 2017, commemorates the signing of the U.S. Constitution on Sept. 17, 1787. Educational institutions are required to hold an educational program pertaining to the Constitution on Sept. 17. The Department of Education does not mandate any particular curricula. Information may be obtained at: http://www.constitutionday.com or at https://www.constitutionfacts.com/index.cfm
Department extends public comment period on regulatory review
On Aug. 11, 2017, the Department of Education issued a Notice in the Federal Register announcing that it is extending the deadline for public comments on federal regulations that may be appropriate for repeal, replace, or modify. Previously, a Federal Register Notice of June 22, 2017, announced the initiative, which was geared toward rules and guidance that were overly burdensome, and set a deadline of Aug. 21, 2017.
A copy of the Notice is found at: https://www.gpo.gov/fdsys/pkg/FR-2017-08-11/pdf/2017-16876.pdf
Department cancels its solicitation for proposals for a student loan servicer to service the entire Direct Loan portfolio
On Aug. 1, 2017, the Department of Education announced that it was canceling its solicitation for proposals from student loan servicers interested in servicing the entire Direct Loan portfolio. The procurement had generated criticism from Republicans, Democrats, and industry representatives who said that awarding a contract to a single servicer could place the federal government at risk and would eliminate competition among servicers that could lead to improvements for student and parent borrowers.
In reversing its decision for a new procurement, Federal Student Aid (FSA) indicated that the newly proposed revisions to the solicitation requirements outlined in May “no longer accurately reflects the agency’s requirements” and that the Contracting Officer had determined that “cancellation is appropriate in accordance with Federal Acquisition Regulation 15.2016(e).”
In its place, Secretary of Education Betsy DeVos said the Department would move forward with a new solicitation called the “FSA Next Generation Processing and Servicing Environment” that will require separate acquisitions for database housing, system processing, and customer account servicing. It will provide for a single data processing platform to house all federal student loan information while at the same time allowing for customer account servicing to be performed either by a single contract servicer or by multiple contract servicers. Secretary DeVos said: “By starting afresh and pursuing a truly modern loan servicing environment, we have a chance to turn what was a good plan into a great one.”
A copy of the Secretary’s announcement is found at: https://www.ed.gov/news/press-releases/secretary-devos-announces-intent-enhance-fsas-next-generation-processing-and-servicing-environment?utm_content=&utm_medium=email&utm_name=&utm_source=govdelivery&utm_term
A copy of the FSA announcement withdrawing the solicitation is found at: https://www.fbo.gov/index?s=opportunity&mode=form&id=2bddf49234cf56ff6edfc3ed3cb2a28c&tab=core&_cview=1
Secretary of Education responds to Senator Democrats regarding GE timetable
Secretary of Education Betsy DeVos recently responded to questions submitted by Senator Dick Durbin (D-IL) and 11 other Democratic Senators regarding their concerns about the delay in the gainful employment rules and the borrower defense to repayment rules. Secretary DeVos advised the Senators that the Department announced on July 5, 2017 that it was allowing additional time until July 1, 2018 for institutions to comply with certain gainful employment disclosure requirements. She explained that the Department would also be extending the deadline for all programs to file alternate earnings appeals in light of the June 28, 2017 court decision in American Association of Cosmetology v. DeVos. She noted that the July 5, 2017 announcement does not change the July 1, 2017 deadline for institutions to provide a completed disclosure template on their gainful employment program web pages; however, it does allow until July 1, 2018, for institutions to include the disclosure template, or a link, on their gainful employment promotional materials and directly distribute the disclosure template to prospective students.
Secretary DeVos also advised the Senators that the Department will ensure that all rules and requirements are implemented and enforced appropriately and, when change is needed, the change will occur in accordance with the Administrative Procedure Act (APA). Finally, the Secretary stated that they do not currently have any timetable to send the draft completers lists to schools in 2017. This is normally the first step in generating Gainful Employment data.
A copy of the letter is found at: https://assets.documentcloud.org/documents/3914394/DeVosDurbinGainful.pdf
Assistant Secretary of Congressional and Legislative Affairs pledges to make responses to members of Congress a top priority
On July 31, 2017, Assistant Secretary of Congressional and Legislative Affairs Peter Oppenheim sent a letter to Senator Elizabeth Warren (D-MA) promising to make responding to inquiries from members of Congress a top priority. He also indicated that he would make it a top priority to respond to requests for technical assistance, constituent casework matters, data analyses and other reasonable requests. On July 27, 2017, Senator Warren had sent a letter to Mr. Oppenheim suggesting that she could possibly oppose his nomination because of Secretary DeVos’ lack of responsiveness to her inquiries. Mr. Oppenheim was confirmed on Aug. 3, 2017.
A copy of Senator Warren’s letter of July 27, 2017 is found at: https://www.warren.senate.gov/files/documents/2017_07_27_Oppenheim_Oversight_Letter.pdf
Secretary of Education’s response to Mr. Oppenheim’s confirmation is found at: https://www.ed.gov/news/press-releases/secretary-devos-statement-confirmation-peter-oppenheim
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.
Contact Information: Sharon H. Bob, Ph.D. // Higher Education Specialist // Powers Pyles Sutter and Verville, PC // 1501 M Street, NW, Suite 700, Washington, DC 20005 // 202-872-6772 // Sharon.Bob@PowersLaw.com // http://www.powerslaw.com