PROPOSED RULEMAKING
PENNSYLVANIA HIGHER EDUCATION ASSISTANCE AGENCY
[ 22 PA. CODE CH. 121 ]
Student Financial Aid
[43 Pa.B. 6368]
[Saturday, October 26, 2013]The Pennsylvania Higher Education Assistance Agency (PHEAA), State Grant and Special Programs (SGSP), proposes amended Chapter 121 (relating to student financial aid) to read as set forth in Annex A.
A. Statutory Authority
This proposed rulemaking is authorized by section 6(e) of the act of January 25, 1966 (P. L. 1546, No. 541) (24 P. S. § 5156).
B. Background and Description of Proposed Rulemaking
The purpose of this proposed rulemaking is to update the regulations to conform to current practice. PHEAA is proposing to amend provisions that are obsolete, inconsistent or superseded by current higher education practice. References to obsolete subdivisions are proposed to be deleted or replaced with current references. References to specific forms, some of which are outdated, are proposed to be deleted whenever possible.
Description of the Proposed Amendments
§ 121.1. Definitions
The proposed amendments to this section update the definition of ''academic year'' so that the ending date coincides with the end of final examinations. The definition of ''college entrance examination'' is proposed to be added to recognize the alternative examinations used by higher education institutions. The definition of ''SAT'' is proposed to be deleted because it is no longer the only recognized entrance examination. The definition of ''veteran'' is proposed to be amended to comply with current Federal standards.
§ 121.3. Discrimination prohibited
This section is proposed to be amended to update and make technical edits to delete the Federal student loan reference as it is no longer relevant to the SGSP.
§ 121.4. Denial of eligibility to loan defaulters
This section is proposed to be amended to make clarifying amendments to be inclusive of Federal, State and private loans.
§ 121.5. Enrollment
Outdated language is proposed to be deleted.
§ 121.7. Notice of denial and preliminary review procedures
This section is proposed to be amended to update and delete outdated language and references to outdated forms. The process is proposed to be simplified.
§ 121.8. Applicant and recipient appeals and hearings
This section is proposed to be amended to update and delete outdated language and references to outdated forms. The process is proposed to be simplified.
§ 121.21. Requirements for higher education grant applicants
This section is proposed to be amended to make clarifying amendments to reference the Pennsylvania Department of Education.
§ 121.22. Early admission students
This section is proposed to be amended to replace ''senior high'' school with more the current term ''secondary'' school.
§ 121.32. Approved institution in higher education grant program
This section is proposed to be amended to update language to reference current accrediting bodies. Clarifying amendments are proposed to reference the Pennsylvania Department of Education and to recognize the appropriate responsible persons in institutions of higher education.
§ 121.33. Approved program of study in higher education grant program
This section is proposed to be amended to make clarifying amendments referencing the Pennsylvania Department of Education and the Pennsylvania State Board of Private Licensed Schools.
§ 121.41. Grouping of applicants
This section is proposed to be amended to update the reference to Nationally-recognized college entrance examinations.
§ 121.44. Required family financial data
This section is proposed to be amended to update references to United States Department of Education criteria.
§ 121.47. State Higher Education Grant Program Manual
This section is proposed to be amended to increase transparency and update the reference to recognized accrediting bodies.
§ 121.48. Limitation on payment of grants
This section is proposed to be amended to make a clarifying amendment regarding deadlines for payments of grants.
§ 121.52. Transferring an award
This section is proposed to be amended to delete outdated language.
§ 121.55. Recipients on probation
This section is proposed to be amended to make a clarifying amendment to properly cross reference a related provision.
§ 121.58. Academic progress
This section is proposed to be amended to increase transparency regarding how progress is determined.
C. Fiscal Impact and Paperwork Requirements
The proposed rulemaking will not have adverse impact on the Commonwealth or its political subdivisions. The proposed rulemaking will not impose additional paperwork requirements upon the Commonwealth, its political subdivisions or the private sector.
D. Sunset Date
The PHEAA Board of Directors continuously monitors the effectiveness of its regulations. Therefore, a sunset date has not been assigned.
E. Regulatory Review
Under section 5(a) of the Regulatory Review Act (71 P. S. § 745.5(a)), on August 22, 2013, PHEAA submitted a copy of this proposed rulemaking and a copy of a Regulatory Analysis Form to the Independent Regulatory Review Commission (IRRC) and to the Chairpersons of the House and Senate Education Committees. A copy of this material is available to the public upon request.
Under section 5(g) of the Regulatory Review Act, IRRC may convey any comments, recommendations or objections to the proposed rulemaking within 30 days of the close of the public comment period. The comments, recommendations or objections must specify the regulatory review criteria which have not been met. The Regulatory Review Act specifies detailed procedures for review, prior to final publication of the rulemaking, by PHEAA, the General Assembly and the Governor of comments, recommendations or objections raised.
F. Public Comment
On June 1, 2011, PHEAA solicited comments from financial aid administrators at all State Grant eligible post-secondary institutions in this Commonwealth and the Pennsylvania State Grant Advisory Committee. Substantive comments were not received.
Interested persons are invited to submit written comments, suggestions or objections regarding this proposed rulemaking to Legal and Compliance Services, Pennsylvania Higher Education Assistance Agency, P.O. Box 8147, Harrisburg, PA 17102-8147, czuzack@pheaa.org within 30 days following publication of this proposed rulemaking in the Pennsylvania Bulletin. Reference Pennsylvania Higher Education Grant Program when submitting comments.
G. Effective Date
This proposed rulemaking will be effective upon publication of the final-form rulemaking in the Pennsylvania Bulletin.
JAMES L. PRESTON,
President and Chief Executive OfficerFiscal Note: 58-24. No fiscal impact; (8) recommends adoption.
Annex A
TITLE 22. EDUCATION
PART VIII. HIGHER EDUCATION ASSISTANCE AGENCY
CHAPTER 121. STUDENT FINANCIAL AID
Subchapter A. GENERAL PROVISIONS
MISCELLANEOUS § 121.1. Definitions.
The following words and terms, when used in this chapter, have the following meanings, unless the context clearly indicates otherwise:
* * * * * Academic year—A period that begins on the first day of classes [or] and ends on the last scheduled day of final examinations and that is a minimum of 30 weeks of instructional time during which, for an undergraduate educational program, a full-time student is expected to complete at least 24 semester or trimester hours or 36 quarter hours at a school which measures program length in credit hours or at least 900 clock hours at a school which measures program length in clock hours.
* * * * * Borrower—All endorsers on loans authorized by this chapter.
College entrance examination—A Nationally-recognized standardized test used to assess college readiness chosen at the Agency's sole discretion to rank students who demonstrate the greatest potential to perform at the highest level of academic achievement.
Disposable pay—That part of the borrower's compensation from an employer remaining after the deduction of any amounts required by law to be withheld.
* * * * * Quarter—A period of approximately 11 weeks normally comprising 1/3 of the academic year.
[SAT—The College Entrance Examination Board's Scholastic Assessment Test.]
Semester—A period of approximately 17 weeks normally comprising 1/2 of the academic year.
* * * * * Veteran—A person who engaged in active service in the United States Army, Navy, Air Force, Marines or Coast Guard or was a cadet or midshipman at one of the service academies and was released under a condition other than dishonorable, or will be by June 30 of the academic year for which the application is made, or who was a National Guard or Reserve [enlistee] service member who was activated for Federal duty by Presidential order. ROTC students, cadets or midshipmen currently attending the service academies, National Guard or Reserve enlistees who were not activated for Federal duty[,] by Presidential order or those currently serving in the United States Armed Forces and will continue to serve through June 30 of the academic year for which application is made are not considered veterans.
§ 121.3. Discrimination prohibited.
The race, religious creed, color, sex, [National] national origin, ancestry, handicap, age or marital status of a student or parent applicant will not be factors of consideration for eligibility except to the extent that adjustments or allowances based on marital status may be necessary within the State Higher Education Grant [and the Federal Family Education Loan Programs] Program to properly reflect the ability of the family to finance costs of education.
§ 121.4. Denial of eligibility to loan defaulters.
(a) [No award or disbursement of higher education grants will be made to any person who has allowed a loan to mature through purchase from the lender by the Agency under the Loan Guaranty Programs or who has a current loan default record with the Agency as a result of a claim on the loan having been submitted to the Agency by the lender] A higher education applicant who has defaulted on an educational loan guaranteed or reinsured by the Federal government, the government of any state or institution is ineligible for an award or a disbursement of funds unless the applicant has repaid the loan in whole or in part and, in the judgment of the Agency, did not make such repayment merely to gain grant eligibility or unless the applicant otherwise shows good cause why grant eligibility should be reinstated. [Higher education grants may also be denied to any person who has defaulted on an educational loan guaranteed or reinsured by the Federal Government or by the government of any other state or who has defaulted on a loan made by any institution of higher education to finance the costs of education; eligibility in these cases will be determined in the same manner as in the case of Agency-guaranteed loans.] This includes programs administered by the United States Department of Education or PHEAA when awards have been converted to loans due to failure to meet eligibility or service requirements and the loan is in default status.
(b) [Eligibility for a loan guaranty will be denied to any person who has allowed a loan to mature through purchase from the lender by the Agency under the guaranty of a previous loan in the Loan Guaranty Programs or has a current loan default record with the Agency as a result of a claim on the loan having been submitted to the Agency by the lender unless the applicant has repaid the loan in whole or in part and, in the judgment of the Agency, did not make such repayment merely to gain loan eligibility or unless the applicant otherwise shows good cause why loan eligibility should be reinstated. Eligibility for a loan guaranty may also be denied to any person who has defaulted on an educational loan guaranteed or reinsured by the Federal Government or by the government of any other state or who has defaulted on a loan made by any institution of higher education to finance costs of education; eligibility in these cases will be determined in the same manner as in the case of Agency-guaranteed loans.
(c)] Applicants denied eligibility under this section shall be entitled to review of such denial in accordance with the procedure for review and appeals as provided in §§ 121.7 and 121.8 (relating to notice of denial and preliminary review procedures; and applicant and recipient appeals and hearings).
§ 121.5. Enrollment.
[(a) Student and parent loans. For a student or a parent of a student to be eligible for a loan guaranty, a student shall be or be about to be enrolled in an approved institution of higher learning on at least a half-time basis and be maintaining satisfactory progress as determined by the school.
(b) Higher education grants.] To be eligible for a State higher education grant, a student shall be or be about to be enrolled in an approved institution of higher learning on at least a half-time basis. In addition, the President and Chief Executive Officer may treat students as full-time if unusual circumstances would not permit the student to comply with the exact full-time basis requirements as defined in § 121.1 (relating to definitions). In these instances, the President and Chief Executive Officer will thereafter notify the Board of [his] this action.
§ 121.7. Notice of denial and preliminary review procedures.
* * * * * (e) The appeal shall be filed in writing at the [offices of the Agency at] Agency offices in Harrisburg, and shall include the following information:
(1) The name, address and [Social Security number] PHEAA Account Number of the applicant or recipient.
(2) The date of the decision being appealed.
(3) The reasons for appeal.
(4) The signature of the applicant or recipient.
[(f) Use of the prescribed appeal form is not mandatory to initiate an appeal. Any written notice that may reasonably be construed as a request for an appeal, delivered or mailed to a authorized representative or to any office of the Agency within the prescribed 60-day appeal period, advising that the applicant or recipient is aggrieved and apparently desires a review of the determination denying him financial assistance, shall be deemed to initiate and constitute an appeal. Thereafter, the applicant or recipient shall perfect the appeal by filing a completed appeal form within a reasonable time after instructions for filing the appeal form have been delivered or mailed to him at his last known post office address. The date of initiation of an appeal delivered by mail, either on the prescribed appeal form or by any other form of written communication, will be determined from the postmark appearing upon the envelope in which the appeal form or written communication was mailed.
(g) Appeal forms may be obtained from any local field office of the Agency or at the offices of the Agency at Harrisburg. Assistance in completing and filing the appeal form can be obtained at any local field office of the Agency or at the offices of the Agency in Harrisburg.]
§ 121.8. Applicant and recipient appeals and hearings.
(a) An applicant or recipient who is aggrieved by a determination of the Committee on Appeals denying him eligibility for financial assistance may file an appeal to the Board of Directors.
* * * * * (c) [Use of the prescribed appeal form is not mandatory to initiate an appeal.] Any written notice that may reasonably be construed as a request for an appeal, delivered or mailed to [a duly authorized representative or to any office of the Agency] PHEAA's Office of General Counsel within the prescribed 15-day appeal period, advising that the applicant or recipient is aggrieved and [apparently desires] requests a review of the determination denying him financial assistance, will be deemed to initiate and constitute an appeal. [Thereafter, the applicant or recipient shall perfect the appeal by filing a completed appeal form within a reasonable time after instructions for filing the appeal form have been delivered or mailed to him at his last known post office address.] The date of initiation of an appeal delivered by mail [, either on the prescribed appeal form or by any other form of written communication,] will be determined from the postmark appearing upon the envelope in which the [appeal form or] written communication was mailed.
* * * * *
SECONDARY SCHOOL GRADUATION § 121.21. Requirement for higher education grant applicants.
(a) A State higher education grant applicant shall be a graduate of or attending an approved secondary school, or be a recipient of a Commonwealth secondary school diploma or other State-issued general equivalency diplomas.
(b) An approved secondary school shall be any public or private secondary school, located in this Commonwealth or elsewhere, including foreign institutions and United States schools overseas, which in the judgment of the Pennsylvania Department of Education provides a course of instruction at the secondary level and maintains standards of instruction substantially equivalent to the standards of instruction of the public high schools located in this Commonwealth.
(c) For purposes of the State Higher Education Grant Program, an approved secondary school shall also include any home education program that is accredited by any home schooling accreditation agency approved by the Pennsylvania Department of Education. If the home education program lacks the requisite accreditation, certification by the appropriate local school official attesting that the home education program is in compliance with section 1327.1 of the Public School Code of 1949 (24 P. S. § 13-1327.1) shall be submitted to the Agency by the appropriate local school official.
§ 121.22. Early admission students.
Student applicants who leave a State-approved [senior high] secondary school prior to their senior year and are admitted for the academic year or a portion thereof, immediately following their secondary school studies, to an approved institution of higher learning as early admission students shall be considered as first-year collegiate applicants and in compliance with the high school graduation requirement for purposes of State higher education grant eligibility if the school district of the school that the applicant had attended certifies that:
* * * * *
EDUCATIONAL INSTITUTIONS § 121.32. Approved institution in higher education grant program.
* * * * * (b) To be approved, an institution shall be other than a school of theology or a theological seminary as determined by the Agency, shall be located in the United States[, the Canal Zone, Puerto Rico, the Virgin Islands, American Samoa or Guam] or any of its territories and shall comply with the following:
(1) If the institution is a college or university located within this Commonwealth, the institution shall be approved by the Pennsylvania Department of Education and shall be accredited or a recognized candidate for accreditation with an accrediting body recognized by the United States Department of Education or the Council for Higher Education Accreditation and its successors; if the college or university is located outside this Commonwealth, the institution shall be degree-granting, shall be operated not-for-profit, shall be legally authorized to do business by the appropriate state licensing or approval authority in the state in which it is doing business and shall be fully accredited by an accrediting body recognized by the United States Department of Education or the regional institutional accrediting body recognized by the Council for Higher Education Accreditation and its successors responsible for accreditation in the state where the college or university is conducting its educational program.
(2) If the institution is a hospital school of nursing located within this Commonwealth, the institution shall be initially, provisionally or fully approved by the Pennsylvania State Board of Nursing and shall be accredited by the National League for Nursing Accrediting Commission, the Commission on Collegiate Nursing Education or other accrediting body recognized by the United States Department of Education for the accreditation of nursing schools; if located outside this Commonwealth, the institution shall be legally authorized to do business by the appropriate state licensing or approval authority in the state in which it is doing business and shall be accredited by the National League for Nursing Accrediting Commission, the Commission on Collegiate Nursing Education or other accrediting body recognized by the United States Department of Education for the accreditation of nursing schools.
(3) If the institution is a trade, technical or business school located within this Commonwealth, the institution shall be approved by the Pennsylvania Department of Education or shall currently be, and shall have been throughout the preceding 24 months, licensed by the Pennsylvania State Board of Private Licensed Schools and shall be accredited by an accrediting body recognized by the United States Department of Education or the Council for Higher Education Accreditation and its successors, except that this requirement for licensure and accreditation may be waived by the President and Chief Executive Officer for branch campuses of an institution that [has] have been operating satisfactorily in this Commonwealth for 2 years or more; if the institution is located outside this Commonwealth, it shall be degree-granting, shall be operated not-for-profit and shall be fully accredited by the United States Department of Education or the regional institutional accrediting body recognized by the Council for Higher Education Accreditation and its successors responsible for accreditation in the state where the institution is conducting its educational program.
* * * * * (5) The institution shall have executed and filed with the Agency an agreement on a form provided by the Agency to report or advise the Agency if the institution has knowledge of the name and address of Commonwealth resident students who are recipients of Agency-administered aid who have been convicted in a court of record of a criminal offense which under the laws of the United States or of the Commonwealth would constitute a felony committed after October 29, 1969. Institutional knowledge shall be facts contained in the academic, disciplinary or financial student records of the institution [and] or facts known to persons occupying positions of authority such as the dean of students, director of financial aid [and] or president of the institution [or persons occupying these positions by whatever titles designated by the institution].
* * * * * § 121.33. Approved program of study in higher education grant program.
To be eligible for a State higher education grant, an applicant shall enroll in a program of study approved by the Agency and offered by an institution approved by the Agency under § 121.32 (relating to approved institutions in Higher Education Grant Program) for participation in the State Higher Education Grant Program. An approved program of study shall comply with the following:
* * * * * (3) If offered at a trade, technical or business school located within this Commonwealth, an approved program of study shall be approved by the Pennsylvania Department of Education or by the Pennsylvania State Board of Private Licensed Schools.
* * * * *
Subchapter B. HIGHER EDUCATION GRANT PROGRAM § 121.41. Grouping of applicants.
Higher education grant applicants shall be grouped into the following categories:
(1) Group I. A roster of the top 5,000 prospective freshmen applicants—without breaking ties—listed in descending order by composite score on [the SAT] Nationally-recognized college entrance examinations.
* * * * * § 121.44. Required family financial data.
* * * * * (b) Exceptions. The Agency may determine the eligibility of the applicant without regard to the parents' financial data, waiving its submission, in the following cases:
(1) If the applicant is a veteran as defined in § 121.1 (relating to definitions).
(2) [If the applicant is at least 24 years of age by January 1 prior to the academic year for which application is made.
(3) If the applicant is an orphan or ward of the court.
(4) If the applicant is married or separated.
(5) If the applicant has legal dependents other than a spouse.
(6)] If the applicant is in compliance with other criteria established by the Agency for the processing of applicants without regard to parental financial data which generally are the United States Department of Education criteria for financial independence for Title IV Federal student aid programs.
[(7)] (3) Other exceptions may be granted by the Administrative Review Committee or the Committee on Appeals in turn on an individual case basis.
* * * * * § 121.47. State Higher Education Grant Program Manual.
(a) [The Agency will publish annually a State Higher Education Grant Program Manual containing: all current financial need analysis procedures established by the Agency; a list of approved colleges, universities, and hospital schools of nursing located in this Commonwealth; a list of approved programs of study offered by approved trade, technical, and business schools located in this Commonwealth; and a list of the Regional Accrediting Commissions of Higher Education and other agencies upon whose accreditation or approval depends the eligibility for the State Higher Education Grant Program, of institutions of higher learning located outside this Commonwealth, and, where applicable, of programs of study offered by institutions of higher learning located outside this Commonwealth.] The Agency will publish annually a State Higher Education Grant Program Manual containing:
(1) Current financial need analysis procedures established by the Agency.
(2) A list of approved colleges, universities and hospital schools of nursing in this Commonwealth.
(3) A list of approved programs of study offered by approved trade, technical and business schools in this Commonwealth.
(4) A list of approved institutions of higher learning outside of this Commonwealth.
(5) When applicable, a list of programs of study offered by institutions of higher learning outside of this Commonwealth.
(6) A list of accrediting agencies (bodies) recognized by the Agency for the State Higher Education Grant Program.
(b) [One copy of such manual will be available for public inspection in the principal office of the Agency and at each regional office.] The State Higher Education Grant Program Manual will be available on the Agency's web site.
§ 121.48. Limitation on payment of grants.
The Agency will not make payment of, or further payment on, an existing State higher education grant on the basis of an inquiry or request received after August 1 of the calendar year [next commencing] immediately following the academic year for which the payment is sought unless the President and Chief Executive Officer specifically directs that payment be made to prevent grave hardship.
§ 121.52. Transferring an award.
[(a) A recipient shall be limited to no more than two institutional transfers after the initial disbursement of his higher education grant funds. That is to say, a student who enrolls in institution A may transfer his award to institution B and thereafter to institution C, but will forfeit his award if thereafter he transfers to institution D.
(b)] A recipient may not transfer his award to a nonapproved institution or course of study.
§ 121.55. Recipients on probation.
A recipient on academic or disciplinary probation shall remain eligible for a higher education grant if the institution of higher learning permits him to continue his studies on at least a half-time basis and he is making satisfactory academic progress as required under § 121.58 (relating to academic progress).
§ 121.58. Academic progress.
(a) A higher education grant recipient must make normal academic progress, as defined in the State Higher Education Grant Program Manual, from year to year [in order] to retain higher education grant eligibility.
* * * * *
[Pa.B. Doc. No. 13-1986. Filed for public inspection October 25, 2013, 9:00 a.m.]
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