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Federal Update – June 12

Federal Update – June 12

GOVERNMENT RELATIONS HIGHLIGHTS

  • Members of House Send Letter to Department on 100% Certification Rule: A bi-partisan coalition of Members of Congress sent a letter to Secretary Cardona requesting that the Department of Education delay enforcement of the revised 100% Certification Rule until July 1, 2025.
  • 100% Certification Rule Lawsuits: The Department of Education has been sued in two separate lawsuits seeking to enjoin the 100% certification rule.
  • FVT/GE User Guide: The Department of Education published Volume 2 and 3 of the NSLDS FVT/GE User Guide. The User Guide is intended to assist institutions comply with the October 1, 2024 FVT/GE reporting deadlines.

CONGRESSIONAL LETTER SEEKS DELAY IN ENFORCEMENT OF 100% RULE

What You Need to Know

A bi-partisan group of Members from the House of Representatives sent a letter to Secretary Cardona requesting that the Department of Education delay enforcement of the revised 100% Certification Rule until July 1, 2025.

The Members of Congress who signed the letter are as follows:

  1. Representative Lloyd Smucker (R-PA)
  2. Representative Burgess Owens (R-UT)
  3. Representative Dan Meuser (R-PA)
  4. Representative GT Thompson (R-PA)
  5. Representative Tom Suozzi (D-NY)
  6. Representative Darren Soto (D-FL)
  7. Representative Jefferson Van Drew (R-NJ)

Why This is Important

Many AACS members remain concerned about the impact that the revised 100% Certification Rule will have on their schools. This letter represents an important, bi-partisan expression of concern from Members of Congress to the Secretary of Education. The Department is aware that some institutions may need more time to comply with the new rule and has previously stated that it will exercise “enforcement discretion” between July 1, 2024 and January 1, 2025.

For more information:

Bi-Partisan Letter

LAWSUITES FILED AGAINST DEPARTMENT OF EDUCATION

What You Need to Know

The Department of Education has been sued in two separate cases seeking to enjoin enforcement of the 100% certification rule. On May 31, 2024, the Cortiva Institute School of Beauty, Health and Wellness filed a complaint against the U.S. Department of Education in the Fort Worth Division of the Northern District of Texas. Subsequently, on June 7, the American Massage Therapy Association (“AMTA”) filed suit in the U.S. District Court for the District of Columbia. The cases assert different legal theories on why the rule is unlawful. Both ask the courts to prevent the rule from going into effect on July 1, 2024.

Why This is Important to You

Both the Cortiva and AMTA cases seek a nationwide injunction against the implementation of the 100% certification rule. As such, each has the potential to bring relief from the rule. AACS is monitoring both cases and will provide an update to members as appropriate. However, members should keep in mind that litigation against the government in these types of cases is always an uphill battle and success is never guaranteed. Therefore, in the meantime AACS members should continue with advocacy efforts at the state level and with accreditors. Members should also be prepared to comply with the rule starting on July 1 in the event that the rule takes effect as scheduled.

For more information:

Complaint

FAFSA ANNOUNCEMENT

Why This is Important to You

Secretary Miguel Cardona sent an internal letter to the Department outlining comprehensive steps that the Department is taking to improve the Office of Federal Student Aid (“FSA”). The Department is seeking to “modernize” the FSA Office following the failed FAFSA rollout. As stated in the letter, Secretary Cardona provided that the changes include, “changes in leadership, boosting oversight and accountability, and engaging a variety of stakeholders so that FSA works best for our most important stakeholders—students and families.”

What You Need to Know

We have continued to hear from membership about the impact that the FAFSA rollout has had on your administrative teams and students. The impact of the FAFSA rollout has been felt by almost every sector of the higher education industry. We are hopeful that the proposed changes to the Office of FSA will benefit AACS member institutions.

For more information:Electronic Announcement

FVT/GE USER GUIDE VOLUMES 2 AND 3

Why This is Important to You

In early June, the Department of Education published Volume 2 and 3 of the NSLDS FVT/GE User Guide. The User Guide is intended to assist institutions comply with the October 1, 2024 FVT/GE reporting deadlines. Institutions should familiarize themselves with the reporting requirements sooner rather than later so that they have time to submit the data prior to the October 1, 2024 deadline. All institutions should review Volumes 1, 2, and 3 of the User Guide and be on the lookout for future installments of the User Guide, which will be published in the coming months.

What You Need to Know

Volume 2 of the NSLDS Financial Value Transparency and Gainful Employment (FVT/GE) User Guide focuses on the batch reporting of program information via the Student Aid Internet Gateway (SAIG) to the National Student Loan Data System (NSLDS®). The volume provides schools with details on the descriptions for the FVT/GE Program Batch Submittal File, along with information on the header and trailer details, file formats, data elements, and definitions.

Volume 3 of the NSLDS Financial Value Transparency and Gainful Employment (FVT/GE) User Guide focuses on the Completers List process. The reporting process starts with the formation of the Draft FVT/GE Completers List, and is followed by the 60-day correction period, and then concludes with the creation of the FVT/GE Final Completers List. The Draft FVT/GE Completers List will be comprised of students who completed a Gainful Employment (GE) or an Eligible Non-GE program during the applicable cohort period.

For more information:

Volume 2 of User Guide

Volume 3 of User Guide

TITLE IV WEBINARS

What You Need to Know

The Department has announced that it is hosting a series of live webinars which cover a variety of topics related to the Title IV programs, including a webinar on reporting FVT/GE data on July 10, 2024. The webinars provide the most recent guidance from the Department and the office of Federal Student Aid, including statutory and regulatory updates. Federal Student Aid staff will present the next set of webinars in this series from July–October 2024.

As to the FVT/GE reporting webinar, it will take place on Wednesday, July 10, 2024, 1–2:30 p.m. ET. The webinar provides an overview of the technical and operational details schools need to know to fully comply with the reporting requirements.

Why This is Important to You

Under the new Financial Value Transparency and Gainful Employment (FVT/GE) regulations, schools are required to report student-specific and program-specific information to the National Student Loan Data System (NSLDS®) annually, beginning October 1, 2024. This webinar provides important information to institutions to understand its requirements under the new regulations.

For more information:

Electronic Announcement

STUDENT LOAN SERVICERS ACCOUNTABILITY ACT

What You Need to Know

On June 5, 2024, Rep. Sara Jacobs (D-CA) and Sen. Ron Wyden (D-OR) introduced the Student Loan Servicers Accountability Act. The legislation requires loan servicers to comply with strict performance standards and agree to revised contract terms in order to contract with the federal government. The Act includes the following provisions:

(i) Revised contract terms which include requiring servicer to place borrower loans into administrative forbearance when servicer has identified an error;

(ii) Requirement for servicers to maintain records of borrower accounts for a minimum of two years following the full payment of the loan; and

(iii) Allow the Government Accountability Office to further analyze and report on the current student loan process and relationship between loan servicer and borrowers.

Why This is Important to You

This Act is important for student borrowers. The Act is likely aimed at responding to a number of challenges the federal government is facing with current student loan servicers, such as the Missouri Higher Education Loan Authority (“MOHELA”) and the Pennsylvania Higher Education Assistance Agency. MOHELA has received claims of mismanaging student loan accounts, and the Consumer Financial Protection Bureau is suing the Pennsylvania Higher Education Assistance Agency for collecting on private student loans that were already discharged by bankruptcy courts. The Act likely has support of the Democratic Members, but it remains to be seen whether it will garner sufficient support to pass the House.

For more information:

One Pager

Press Release

For More Information

If you have any questions about this Update, please email info@beautyschools.org.

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