1845-0048 v6 supporting statement 8 28 2012

EDICS Tracking and OMB Number: (04886) 1845-0048 v6 Revised: 08/28/2012

RIN Number: XXXX-XXXX (if applicable)

SUPPORTING STATEMENT

FOR PAPERWORK REDUCTION ACT SUBMISSION

Federal Perkins Loan Assignment Form and Instructions     

A. Justification

1. Explain the circumstances that make the collection of information necessary. Identify any legal or administrative requirements that necessitate the collection. Attach a hard copy of the appropriate section of each statute and regulation mandating or authorizing the collection of information, or you may provide a valid URL link or paste the applicable section¹. Specify the review type of the collection (new, revision, extension, reinstatement with change, reinstatement without change). If revised, briefly specify the changes. If a rulemaking is involved, make note of the sections or changed sections, if applicable.

Schools participating in the Federal Perkins Loan Program, formerly the National Direct/Defense Student Loan Program (NDSL), currently use this form to assign defaulted loans to the U.S. Department of Education (the Department) for collection. These defaulted loans may, as outlined in 20 U.S.C. 1087cc and under program regulations 34 CFR 674.50, be assigned to the Federal government (i.e., Department of Education) for collection when the school has exhausted all efforts in the recovery of the outstanding loan. In addition, schools use this form to assign loans for which a school has approved a total and permanent disability discharge request, in accordance with 34 CFR 674.61(b) (2) (v).

In response to the “Terms of Clearance” with the last approval action, the Department planned to implement a system that would allow schools to submit the Perkins loan assignment information electronically. The full electronic submission of the assignment form and information is not yet possible. The form has been updated to allow for electronic input however electronic filing of the cover form as well as supporting documentation is not yet available. Work continues to establish a system that will be more automated than the current system and will allow for electronic submission of the information required for assignment of Perkins loans. We estimate that the new system will be implemented in the near future. Until that time the assignment form can only be submitted through the U.S. Postal Mail Service.

The Department is requesting a continuation of the currently approved collection reflecting technical updates. There are minor wording changes to the fillable form made for clarity.

2. Indicate how, by whom, and for what purpose the information is to be used. Except for a new collection, indicate the actual use the agency has made of the information received from the current collection.

The Perkins Assignment Form is the transmitting document for the assignment process. It collects pertinent information required by the Department on the loans being submitted for assignment. Except for total and permanent disability discharges, schools are not required to assign accounts to the Department. For non-disability discharge assignments, schools assign loans to the Department in an effort to cease their loan servicing responsibilities and costs, and to reduce their paperwork burden.

3. Describe whether, and to what extent, the collection of information involves the use of automated, electronic, mechanical, or other technological collection techniques or forms of information technology, e.g. permitting electronic submission of responses, and the basis for the decision of adopting this means of collection. Also describe any consideration given to using technology to reduce burden.

As noted above the Department is working on implementing a new system to allow for electronic submission of this form. However, the current system used to track this process would not allow for electronic submission. We are unable to have this information collection electronically submitted because of the various supporting documentation that must accompany assigned loans. For example, schools must submit the original promissory note when it assigns loans. Another example: If a borrower applies for a total and permanent disability discharge, it must be submitted with the assigned loan. However, the total and permanent disability discharge form requires a third party “wet” signature. Therefore, this can only be submitted through the U.S. Postal Mail Service.

4. Describe efforts to identify duplication. Show specifically why any similar information already available cannot be used or modified for use for the purposes described in Item 2 above.

There is no duplication of data as a result of the collection of this information.

5. If the collection of information impacts small businesses or other small entities, describe any methods used to minimize burden. A small entity may be (1) a small business which is deemed to be one that is independently owned and operated and that is not dominant in its field of operation; (2) a small organization that is any not-for-profit enterprise that is independently owned and operated and is not dominant in its field; or (3) a small government jurisdiction, which is a government of a city, county, town, township, school district, or special district with a population of less than 50,000.

No small businesses are affected by this collection.

6. Describe the consequences to Federal program or policy activities if the collection is not conducted or is conducted less frequently, as well as any technical or legal obstacles to reducing burden.

If this collection is not conducted Perkins loans would not be able to be assigned nor would borrowers who qualify for the total and permanent disability discharge be able to receive such a benefit. The frequency and timing of reporting will vary with the reason for reporting the information. For example, a school might submit assignments for the following reasons: the school withdrew from the Perkins Program; the school exhausted its collection efforts; or the school determined that the borrower meets the preliminary criteria for total and permanent disability.

7. Explain any special circumstances that would cause an information collection to be conducted in a manner:

• requiring respondents to report information to the agency more often than quarterly;

• requiring respondents to prepare a written response to a collection of information in fewer than 30 days after receipt of it;

• requiring respondents to submit more than an original and two copies of any document;

• requiring respondents to retain records, other than health, medical, government contract, grant-in-aid, or tax records for more than three years;

• in connection with a statistical survey, that is not designed to produce valid and reliable results than can be generalized to the universe of study;

• requiring the use of a statistical data classification that has not been reviewed and approved by OMB;

• that includes a pledge of confidentiality that is not supported by authority established in statute or regulation, that is not supported by disclosure and data security policies that are consistent with the pledge, or that unnecessarily impedes sharing of data with other agencies for compatible confidential use; or

• requiring respondents to submit proprietary trade secrets, or other confidential information unless the agency can demonstrate that it has instituted procedures to protect the information’s confidentiality to the extent permitted by law.

This information collection does not involve any of the conditions listed in 5 CFR 1320.6.

8. As applicable, state that the Department has published the 60 and 30 Federal Register notices as required by 5 CFR 1320.8(d), soliciting comments on the information collection prior to submission to OMB. Summarize public comments received in response to that notice and describe actions taken by the agency in response to these comments. Specifically address comments received on cost and hour burden.

Describe efforts to consult with persons outside the agency to obtain their views on the availability of data, frequency of collection, the clarity of instruction and record keeping, disclosure, or reporting format (if any), and on the data elements to be recorded, disclosed, or reported.

Consultation with representatives of those from whom information is to be obtained or those who must compile records should occur at least once every 3 years – even if the collection of information activity is the same as in prior periods. There may be circumstances that may preclude consultation in a specific situation. These circumstances should be explained.

The Department receives input from the schools participating in the Perkins Loan program through numerous conferences attended by Department employees, such as the National Association of College and University Business Offices (NACUBO), the National Association of Student Financial Aid Administrators (NASFAA), and the Coalition of Higher Education Assistance Organizations (COHEAO) conferences. COHEAO represents Perkins schools, Perkins loan servicers, and Perkins loan collection agents.

Additionally, the community and other interested parties are given the opportunity to provide input on the forms and completion times during the two public comment periods provided for by the Federal Register notices.

9. Explain any decision to provide any payment or gift to respondents, other than remuneration of contractors or grantees with meaningful justification.

The Department provides no payment or gifts to respondents.

10. Describe any assurance of confidentiality provided to respondents and the basis for the assurance in statute, regulation, or agency policy. If personally identifiable information (PII) is being collected, a Privacy Act statement should be included on the instrument. Please provide a citation for the Systems of Record Notice and the date a Privacy Impact Assessment was completed as indicated on the IC Data Form. A confidentiality statement with a legal citation that authorizes the pledge of confidentiality should be provided.² If the collection is subject to the Privacy Act, the Privacy Act statement is deemed sufficient with respect to confidentiality. If there is no expectation of confidentiality, simply state that the Department makes no pledge about the confidentially of the data.

The Department will comply with the Privacy Act in its applications of information collected through the Perkins Assignment Form. This information collection does not include a Privacy Act Notice to borrowers because borrowers are not providing this information to the Department but to their schools, which must comply with the Family Education Rights and Privacy Act (FERPA). When the Department receives this information further disclosure is restricted under our current systems of records notice, which identifies the third parties to whom the information may be disclosed and explains the circumstances under which such disclosures may occur.

11. Provide additional justification for any questions of a sensitive nature, such as sexual behavior and attitudes, religious beliefs, and other matters that are commonly considered private. The justification should include the reasons why the agency considers the questions necessary, the specific uses to be made of the information, the explanation to be given to persons from whom the information is requested, and any steps to be taken to obtain their consent.

The Department is not requesting any sensitive data in this collection package.

12. Provide estimates of the hour burden of the collection of information. The statement should:

• Indicate the number of respondents by affected public type (federal government, individuals or households, private sector – businesses or other for-profit, private sector – not-for-profit institutions, farms, state, local or tribal governments), frequency of response, annual hour burden, and an explanation of how the burden was estimated, including identification of burden type: recordkeeping, reporting or third party disclosure. All narrative should be included in item 12. Unless directed to do so, agencies should not conduct special surveys to obtain information on which to base hour burden estimates. Consultation with a sample (fewer than 10) of potential respondents is desirable. If the hour burden on respondents is expected to vary widely because of differences in activity, size, or complexity, show the range of estimated hour burden, and explain the reasons for the variance. Generally, estimates should not include burden hours for customary and usual business practices.

• If this request for approval covers more than one form, provide separate hour burden estimates for each form and aggregate the hour burdens in the ROCIS IC Burden Analysis Table. (The table should at minimum include Respondent types, IC activity, Respondent and Responses, Hours/Response, and Total Hours)

• Provide estimates of annualized cost to respondents of the hour burdens for collections of information, identifying and using appropriate wage rate categories. The cost of contracting out or paying outside parties for information collection activities should not be included here. Instead, this cost should be included in Item 14.

The submission of accounts to the Department for collection is at the option of the participating school. Therefore, the number of annual responses and burden hours can only be estimated based on current usage. The number of submissions reported here is based on the actual submissions of assignment forms to the Department.

The Department estimates the total annual number of Perkins loan assignment forms received for the award year 2010-2011 was 14,055. Of these there were 11,244 assignment forms accepted for processing by the Department. The estimated response time to complete the form in this submission is 0.5 hours (30 minutes). The burden estimate for each form in this information collection was calculated as follows:

Current Inventory # of Respondents # of Responses Burden Hours 21,262 21,262 8,505

Revised Inventory

Not-for-profit 170 3,676 x 0.5 = 1,838

For-Profit 60 2,235 x 0.5 = 1,118

Public 216 8,144 x 0.5 = 4,072

446 14,055 7,028

Previously the number of responses was also shown as the number of respondents. This is inaccurate. Institutions can file the forms throughout the year but there are not 21,262 institutions participating in the Perkins Loan program.

This revision shows a decrease of 7,207 responses and a decrease in burden of 1,477 hours. We are not able to indicate the change in the number of institutions that filed the assignment forms in the past compare to the number of institutions that file such forms in the 2010-2011 academic year.

13. Provide an estimate of the total annual cost burden to respondents or record keepers resulting from the collection of information. (Do not include the cost of any hour burden shown in Items 12 and 14.)

• The cost estimate should be split into two components: (a) a total capital and start-up cost component (annualized over its expected useful life); and (b) a total operation and maintenance and purchase of services component. The estimates should take into account costs associated with generating, maintaining, and disclosing or providing the information. Include descriptions of methods used to estimate major cost factors including system and technology acquisition, expected useful life of capital equipment, the discount rate(s), and the time period over which costs will be incurred. Capital and start-up costs include, among other items, preparations for collecting information such as purchasing computers and software; monitoring, sampling, drilling and testing equipment; and acquiring and maintaining record storage facilities.

• If cost estimates are expected to vary widely, agencies should present ranges of cost burdens and explain the reasons for the variance. The cost of contracting out information collection services should be a part of this cost burden estimate. In developing cost burden estimates, agencies may consult with a sample of respondents (fewer than 10), utilize the 60-day pre-OMB submission public comment process and use existing economic or regulatory impact analysis associated with the rulemaking containing the information collection, as appropriate.

• Generally, estimates should not include purchases of equipment or services, or portions thereof, made: (1) prior to October 1, 1995, (2) to achieve regulatory compliance with requirements not associated with the information collection, (3) for reasons other than to provide information or keep records for the government or (4) as part of customary and usual business or private practices. Also, these estimates should not include the hourly costs (i.e., the monetization of the hours) captured above in Item 12

Total Annualized Capital/Startup Cost :      

Total Annual Costs (O&M) :      

____________________

Total Annualized Costs Requested :      

There are no capital/startup costs to respondents, nor are there any annual costs to respondents associated with operating or maintaining systems.

14. Provide estimates of annualized cost to the Federal government. Also, provide a description of the method used to estimate cost, which should include quantification of hours, operational expenses (such as equipment, overhead, printing, and support staff), and any other expense that would not have been incurred without this collection of information. Agencies also may aggregate cost estimates from Items 12, 13, and 14 in a single table.

The total estimated annual cost to the Federal government this information collection is $265,775.00. This is the cost for review and entry of this information.

15. Explain the reasons for any program changes or adjustments. Generally, adjustments in burden result from re-estimating burden and/or from economic phenomenon outside of an agency’s control (e.g., correcting a burden estimate or an organic increase in the size of the reporting universe). Program changes result from a deliberate action that materially changes a collection of information and generally are result of new statute or an agency action (e.g., changing a form, revising regulations, redefining the respondent universe, etc.). Burden changes should be disaggregated by type of change (i.e., adjustment, program change due to new statute, and/or program change due to agency discretion), type of collection (new, revision, extension, reinstatement with change, reinstatement without change) and include totals for changes in burden hours, responses and costs (if applicable).

The Department is requesting an extension of the current Perkins Loan Assignment form. While there are minor language changes to the instructions and form, it is for clarity not to change the information that is being collected. We are identifying a downward adjustment in the number of assignment forms being filed based on the collection information available for the most recently completed award year based on use of the form and process not on changes to the regulations.

16. For collections of information whose results will be published, outline plans for tabulation and publication. Address any complex analytical techniques that will be used. Provide the time schedule for the entire project, including beginning and ending dates of the collection of information, completion of report, publication dates, and other actions.

The results of this information collection will not be published.

17. If seeking approval to not display the expiration date for OMB approval of the information collection, explain the reasons that display would be inappropriate.

The Department is not seeking this approval.

18. Explain each exception to the certification statement identified in the Certification of Paperwork Reduction Act.

There are no exceptions to the certification statement identified in Item 20, Certification for Paperwork Reduction Act Submissions, of OMB Form 83-1.

1 Please limit pasted text to no longer than 3 paragraphs.

2 Requests for this information are in accordance with the following ED and OMB policies: Privacy Act of 1974, OMB Circular A-108 – Privacy Act Implementation – Guidelines and Responsibilities, OMB Circular A-130 Appendix I – Federal Agency Responsibilities for Maintaining Records About Individuals, OMB M-03-22 – OMB Guidance for Implementing the Privacy Provisions of the E-Government Act of 2002, OMB M-06-15 – Safeguarding Personally Identifiable Information, OM:6-104 – Privacy Act of 1974 (Collection, Use and Protection of Personally Identifiable Information)

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