Teacher Education Assistance for College

Enclosure D

Monday,
June 23, 2008

See page 35496

Part III

Department of
Education

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34 CFR Parts 668, 673, 674, et al.
The Teacher Education Assistance for
College and Higher Education (TEACH)
Grant Program and Other Federal Student
Aid Programs; Final Rule

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Enclosure D

35472

Federal Register / Vol. 73, No. 121 / Monday, June 23, 2008 / Rules and Regulations

DEPARTMENT OF EDUCATION/
34 CFR Parts 668, 673, 674, 675, 676,
682, 685, 686, and 690
RIN 1840–AC93
[Docket ID ED–2008–OPE–0001]

The Teacher Education Assistance for
College and Higher Education (TEACH)
Grant Program and Other Federal
Student Aid Programs
Office of Postsecondary
Education, Department of Education.
ACTION: Final regulations.
AGENCY:

The Secretary amends title 34
of the Code of Federal Regulations to
establish regulations for the Teacher
Education Assistance for College and
Higher Education (TEACH) Grant
program. The TEACH Grant program is
a non-need-based grant program that
provides up to $4,000 per year to
students who are enrolled in an eligible
program and who agree to teach in a
high-need field, at a low-income
elementary or secondary school for at
least four years within eight years of
completing the program for which the
TEACH Grant was awarded. If the grant
recipient fails to complete the required
teaching service, the TEACH Grant is
treated as a Federal Direct Unsubsidized
Stafford Loan (Federal Direct
Unsubsidized Loan). The Secretary also
amends the regulations related to the
Student Assistance General Provisions;
the General Provisions for the Federal
Perkins Loan Program, Federal WorkStudy Program, and Federal
Supplemental Educational Opportunity
Grant Program; the Federal Perkins Loan
Program; the Federal Work-Study
Program; the Federal Supplemental
Educational Opportunity Grant
Program; the Federal Family Education
Loan (FFEL) Program; the William D.
Ford Federal Direct Loan Program; and
the Federal Pell Grant Program to
implement the TEACH Grant program.
These regulations are needed to
implement provisions of the Higher
Education Act of 1965 (HEA), as
amended by the College Cost Reduction
and Access Act of 2007 (CCRAA).
DATES: Effective Date: These regulations
are effective July 1, 2008.
FOR FURTHER INFORMATION CONTACT:
Michelle Belton, U.S. Department of
Education, 1990 K Street, NW., room
8031, Washington, DC 20006–8502.
Telephone: (202) 502–7821 or via the
Internet at: [email protected].
If you use a telecommunications
device for the deaf (TDD), call the
Federal Relay Service (FRS), toll free, at
1–800–877–8339.

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SUMMARY:

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Individuals with disabilities can
obtain this document in an alternative
format (e.g. , Braille, large print,
audiotape, or computer diskette) on
request to the contact person listed in
this section.
SUPPLEMENTARY INFORMATION: On March
21, 2008, the Secretary published a
notice of proposed rulemaking (NPRM)
for the Teacher Education Assistance for
College and Higher Education (TEACH)
Grant Program and Other Federal
Student Aid Programs in the Federal
Register (73 FR 15336).
In the preamble to the NPRM, the
Secretary discussed on pages 15337
through 15352 the major regulations
proposed in that document to
implement the TEACH Grant program
authorized under Title IV of the HEA,
including the following:
• Amending § 668.164(g) to add the
TEACH Grant program to the list of
programs for which a student becomes
ineligible when the student is no longer
enrolled at the institution for the award
year and to describe how TEACH Grant
recipients may qualify for a late
disbursement.
• Amending § 668.183 to specify that
a TEACH Grant that has been converted
to a Federal Direct Unsubsidized Loan
would not be included in calculating an
institution’s cohort default rate.
• Amending § 673.5 to include the
amount of any TEACH Grant in the
types of funds that may be used to
replace a student’s expected family
contribution (EFC).
• Adding new § 686.2 to define the
terms ‘‘Academic year or its equivalent
for elementary and secondary schools
(Elementary or secondary academic
year),’’ ‘‘Annual award,’’ ‘‘Scheduled
award,’’ ‘‘Elementary school,’’ ‘‘Highneed field,’’ ‘‘Highly-qualified,’’
‘‘Numeric equivalent,’’ ‘‘Postbaccalaureate program,’’ ‘‘Retiree,’’
‘‘School serving low-income students
(low-income school),’’ ‘‘Secondary
school,’’ ‘‘Service Agreement,’’ ‘‘TEACH
Grant-eligible institution,’’ ‘‘TEACH
Grant-eligible program,’’ ‘‘Teacher,’’ and
‘‘Teacher preparation program.’’
• Adding new § 686.3 to establish the
duration of student eligibility for a
TEACH Grant based on the maximum
amount of grant funds available to
students under section 420M(d)(1) and
(2) of the HEA.
• Adding new § 686.4 to give
institutions the option to participate in
the TEACH Grant program, to clarify
that participation in the program is
voluntary, and to describe the
obligations of institutions if they cease
to participate in the program.
• Adding new § 686.5 to specify how
an institution would treat

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correspondence courses for purposes of
the TEACH Grant program.
• Adding new § 686.6 to prohibit
students from receiving TEACH Grant
payments concurrently from more than
one institution.
• Adding new § 686.10 to describe
the procedures that a student must
follow when applying for a TEACH
Grant, and, in particular, to require that
a student submit a Free Application for
Federal Student Aid (FAFSA), complete
and sign a service agreement and
promise to repay, and provide any
additional information requested by the
Secretary.
• Adding new § 686.11 to establish
student eligibility requirements for the
TEACH Grant program.
• Adding new § 686.12 to describe
the agreement students must sign prior
to receiving each TEACH Grant award,
and to explain the service obligation
that students must carry out for the
TEACH Grant award not to convert to a
Federal Direct Unsubsidized Loan.
• Adding new § 686.20 to require a
student to submit a valid Student Aid
Report (SAR) or for the student’s
institution to receive an Institutional
Student Information Record (ISIR) with
an official EFC so that the institution
can determine the appropriate amount
of a student’s TEACH Grant.
• Adding new § 686.21 to provide
that while a Scheduled Award for the
TEACH Grant program is $4,000,
students may receive lesser annual
award amounts depending on their
enrollment status and to clarify that a
student’s TEACH Grant award,
combined with other estimated financial
assistance, cannot exceed the cost of the
student’s attendance as determined by
the institution.
• Adding new §§ 686.22 and 685.25
to: (1) Describe how an institution
calculates a TEACH Grant payment for
a payment period for an eligible student
depending on the academic calendar of
the eligible program, the student’s
enrollment status, and the amount of the
student’s annual award; (2) establish the
minimum payment for a payment
period; (3) require institutions to define
the term ‘‘academic year’’ for purposes
of calculating payments for payment
periods; and (4) allow institutions to use
overlapping Scheduled Awards in a
payment period.
• Adding new § 686.23 to address
how an institution calculates a TEACH
Grant payment for an eligible student’s
payment period when the student is
enrolled in a payment period that
overlaps two award years.
• Adding new § 686.24 to establish
how an institution calculates a payment
for an eligible student who transfers

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from another postsecondary institution
within the same award year.
• Adding new § 686.31 to delineate
what an institution must do to
determine whether a student is eligible
to receive a TEACH Grant.
• Adding new § 686.32 to describe
the initial, subsequent, and exit
counseling that institutions must
provide to each TEACH Grant recipient.
• Adding new § 686.33 to allow
institutions to pay a student a TEACH
Grant at such times and in such
installments that best meet the student’s
needs.
• Adding new § 686.37 to describe
the information pertaining to a student’s
TEACH Grant eligibility that an
institution must submit to the
Department and to establish submission
deadlines for this information.
• Adding new § 686.40 to define how
and when a TEACH Grant recipient
must contact the Department to
document fulfillment of his or her
service obligation or, if the service
obligation has not been met, the intent
to fulfill the service obligation.
• Adding new § 686.41 to define the
conditions under which a TEACH Grant
recipient will be able to request a
suspension of his or her service
obligation for a specified amount of
time.
• Adding new § 686.42 to require the
discharge of a grant recipient’s service
obligation if the recipient dies or
becomes totally and permanently
disabled, and to clarify that the fouryear service obligation still would apply
to a recipient who is in a conditional
discharge period.
• Adding new § 686.43 to describe
the various conditions under which a
TEACH Grant would be converted into
a Federal Direct Unsubsidized Loan,
with interest accruing from the date of
each grant disbursement and which a
TEACH Grant recipient would be
required to pay.
Technical Corrections
We are making minor technical
changes, including the following, to
correct errors that we identified during
our review of the proposed regulations.

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Program Participation Agreement
(§ 668.14(f))
We have revised § 668.14(f) to correct
inaccurate cross-references. Specifically,
§ 668.14(f) has been amended to crossreference paragraphs (g) and (h) of the
section, rather than (h) and (i) of the
section. We also have revised
§ 668.14(f)(3) to cross-reference
paragraph (f), rather than paragraph (g),
of the section.

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Teacher Loan Forgiveness Program
(§§ 682.215 and 685.217)
We have revised §§ 682.215(c)(7)(ii)
and 685.217(c)(7)(ii) to correct
inaccurate citations for the Family and
Medical Leave Act of 1993 (FMLA). The
correct citation for the FMLA is 29
U.S.C. 2601, et seq., not 19 U.S.C. 2654.
Analysis of Comments and Changes
The regulations in this document
were developed through negotiated
rulemaking. Section 492 of the HEA
requires that, before publishing any
proposed regulations to implement
programs under Title IV of the HEA, the
Secretary must obtain public
involvement in the development of the
proposed regulations. After obtaining
advice and recommendations, the
Secretary must conduct a negotiated
rulemaking process to develop the
proposed regulations. All proposed
regulations must conform to agreements
resulting from the negotiated
rulemaking process unless the Secretary
reopens that process or explains any
departure from the agreements to the
negotiated rulemaking participants.
These regulations were published in
proposed form on March 21, 2008, in
conformance with the consensus of the
negotiated rulemaking committee.
Under the committee’s protocols,
consensus meant that no member of the
committee dissented from the agreedupon language. The Secretary invited
comments on the proposed regulations
by April 21, and in response to the
Secretary’s invitation, 132 parties
submitted comments on the proposed
regulations. An analysis of the
comments and the changes in the
regulations since publication of the
NPRM follows.
We group major issues according to
subject, with appropriate sections of the
regulations referenced in parentheses.
We discuss other substantive issues
under the sections of the regulations to
which they pertain. Generally, we do
not address minor, non-substantive
changes.
General
Comment: The Department received
several general comments about the
TEACH Grant program. Four
commenters suggested that the program
is inappropriately named and argued
that the Department should change the
name of the program to reflect the fact
that it is, in their opinion, a loan
forgiveness program rather than a grant
program. Two commenters argued that
the funds dedicated for the TEACH
Grant program would better serve
students if they were reallocated to the

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current Teacher Loan Forgiveness
Program or to the Perkins Loan Program.
The Department also received
comments in support of the TEACH
Grant program that did not address
specific sections of the proposed
regulations.
Discussion: The name, purpose, and
structure of the program are established
by the HEA and cannot be changed by
the Department. The Department is not
authorized to reallocate funds Congress
designates for the TEACH Grant
program to another program.
The Department is working to
disseminate detailed information about
the unique nature of the TEACH Grant
program, including how TEACH Grants
may, under certain circumstances,
convert into Federal Unsubsidized
Direct Loans, to institutions as well as
to parents and students.
Changes: None.
Eligible Programs (§ 668.8)
Comment: One commenter requested
clarification about the relationship
between the definition of eligible
program in § 668.8 and the definition of
TEACH Grant-eligible program in 34
CFR 686.2(d). The commenter
questioned whether it is appropriate to
add, in § 668.8(h)(3), a cross-reference to
the definition of TEACH Grant-eligible
program in 34 CFR 686.2(d). In addition,
the commenter asked if programs that
contribute to a student’s ability to teach
in a high-need field should be included
in the definition of eligible program
under § 668.8(h)(3)(i).
Discussion: We agree that the
connection between the definition of
eligible program in § 668.8 and the
definition of TEACH Grant-eligible
program found in 34 CFR 686.2(d) needs
clarification. For purposes of the
TEACH Grant program, an educational
program is an eligible program under
§ 668.8 only if it qualifies as a TEACH
Grant-eligible program in accordance
with 34 CFR 686.2(d). Rather than
amend § 668.8 to restate the definitional
requirements of a TEACH Grant-eligible
program, we amended § 668.8 simply to
cross-reference the definition in 34 CFR
686.2(d).
A program that contributes to a
student’s ability to teach in a high-need
field would be a TEACH Grant-eligible
program if it is designed to prepare an
individual to teach as a highly qualified
teacher in a high-need field and leads to
a baccalaureate or master’s degree, or is
a post-baccalaureate program of study.
Changes: We amended § 668.8(h) to
clarify that an educational program
qualifies as an eligible program for
purposes of the TEACH Grant program
only if it is a TEACH Grant-eligible

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Definitions (§ 686.2(d))

program in accordance with 34 CFR
686.2(d).
Treatment of Title IV grant and loan
funds when a student withdraws
(§ 668.22)
Comment: One commenter questioned
the placement of TEACH Grants in the
listing of unearned grant funds returned
in the event a student withdraws from
an institution during a payment period.
The commenter believed that TEACH
Grants should be placed at the
beginning of the order for returning
grant funds and asked that that
placement be reconsidered.
Discussion: As reflected in the NPRM,
the Department believes that TEACH
Grants should not be at the beginning of
the order for returning grant funds.
Under the regulations, TEACH Grants
will be returned after Federal Pell
Grants, Academic Competitiveness
Grants, National SMART Grants, and
FSEOG program assistance. This return
order is prescribed by section
484B(b)(3)(B)(iii) of the HEA.
Changes: None.
Calculating and Applying Cohort
Default Rates (§ 668.183)
Comment: Several commenters
supported § 668.183, which provides
that a TEACH Grant that has been
converted to a Federal Direct
Unsubsidized Loan is not included in
the calculation of an institution’s cohort
default rate.
Discussion: We appreciate the
commenters’ support.
Changes: None.
Overaward (§ 673.5)
Comment: One commenter supported
the proposal that TEACH Grants be
allowed to replace the EFC, believing
that this approach fulfills the spirit of
the legislation and will be helpful in
making awards to students.
Discussion: We appreciate the
commenter’s support.
Changes: None.

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Maximum Loan Amounts (§§ 682.204
and 685.203)
Comment: One commenter wrote to
support the proposal to exclude a
TEACH Grant that has been converted to
a Federal Direct Unsubsidized Loan
from a borrower’s aggregate or annual
loan limits in the Federal Family
Education Loan (FFEL) and Federal
Direct Loan Programs.
Discussion: We appreciate the
commenter’s support.
Changes: None.

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Agreement To Serve
Comment: None.
Discussion: The Department is
changing the name of the agreement
described in section 420N(b) of the HEA
from ‘‘service agreement’’ to ‘‘agreement
to serve’’ to be more consistent with the
statute.
Change: We have amended § 686.2(d)
to change the name of the agreement
under which a TEACH Grant recipient
commits to meet the service obligation
described in § 686.12 from ‘‘service
agreement’’ to ‘‘agreement to serve.’’
High-Need Field
Comment: A large number of
commenters suggested that library
media specialist should be included in
the list of high-need fields. They argued
that all 50 States require that a school
library media specialist have a State
teaching certificate, that library media
specialists are considered teachers and
are responsible for developing
curriculum and instructing students,
and that there are significant shortages
of library media specialists across the
country. Several commenters contended
that early childhood education should
be considered a high-need field because
of the shortage of baccalaureate-degreeholding early childhood education
teachers and the requirement that Head
Start teachers have a bachelor’s degree
in early childhood education by 2013.
Discussion: Under certain
circumstances, library media specialist
and early childhood education qualify
as high-need fields and a grant recipient
could fulfill the service obligation
associated with receipt of a TEACH
Grant by teaching in these fields. As
specified in § 686.12(b), for each TEACH
Grant-eligible program for which the
student received TEACH Grant funds,
the grant recipient must fulfill a service
obligation by serving as a full-time
teacher for a total of not less than four
elementary or secondary academic years
within eight calendar years after
completing the program or otherwise
ceasing to be enrolled in the program for
which the recipient received the TEACH
Grant in a low-income school, as a
highly qualified teacher, and in a highneed field in the majority of classes
taught during each elementary and
secondary academic year.
The definition of high-need field in
§ 686.2(d) reflects section 420N(b) of the
HEA which specifically designates
several fields as high-need and provides
for the inclusion of other fields that are
documented as high-need by the Federal
Government, a State government or a
local educational agency (LEA), and

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approved by the Secretary. The
regulations explain that the additional
high-need fields are those listed in the
Department’s annual Teacher Shortage
Area Nationwide Listing (Nationwide
List), which is available on the
Department of Education’s Web site at
http://www.ed.gov/about/offices/list/
ope/pol/tsa.pdf. The Nationwide List is
based on information submitted to the
Department by the States, and inclusion
of a field on the Nationwide List
indicates approval by the Department of
Education. Some States have identified
early childhood education and library
media specialist as shortage areas in the
Nationwide List.
For purposes of the TEACH Grant
program, a teacher is someone who
provides direct classroom teaching or
classroom-type teaching in a nonclassroom setting in an elementary or
secondary school. An elementary or
secondary school is a nonprofit
institutional day or residential school,
including a public elementary or
secondary charter school, that provides
elementary or secondary education, as
determined under State law. The
individual must be teaching the
majority of classes in the high-need
field. In the case of service in early
childhood education, to meet the
criterion of being a highly qualified
teacher the individual would need to be
certified by the State in early childhood
education. To meet the criterion of
teaching in an elementary school, the
service would need to take place in an
elementary school and the State would
need to consider early childhood
education a component of the State’s
elementary school education system and
have designated early childhood
education as a high-need field.
To meet the criterion of ‘‘highly
qualified,’’ a library media specialist
would need to be certified by the State
as a library media specialist. To meet
the criterion of ‘‘teacher,’’ the library
media specialist would need to be
performing direct classroom teaching or
classroom-type teaching in a nonclassroom setting for a majority of time
in an elementary or secondary school. In
addition, the State would have to
designate library media specialist as a
high-need field. In all cases, the service
would need to be performed in a lowincome school.
Changes: None.
Comment: A couple of commenters
inquired whether elementary education
could be included as a high-need field.
One commenter requested that we
provide specific information about how
elementary school teachers could
demonstrate that they are teaching in a
high-need field.

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Discussion: As described in the
discussion of library media specialist
and early childhood education,
elementary education could be a highneed field if it is designated as a highneed field by the State in which the
recipient teaches.
There are other limited circumstances
under which a grant recipient can
satisfy the service obligation by serving
as an elementary school teacher
including: (1) Teaching the majority of
his or her courses in a high-need field,
such as math, science, or a foreign
language; (2) teaching in a foreign
language immersion program; (3)
serving as a reading specialist, a special
education teacher, or a bilingual
education teacher, or teaching English
language acquisition; or (4) teaching in
a low-income school in a State that has
designated elementary education as a
high-need field.
Changes: None.
Comment: A couple of commenters
asked for clarification of the terms
‘‘bilingual education’’ and ‘‘English
language acquisition.’’ One commenter
questioned whether bilingual education
includes immersion classrooms.
Discussion: The National
Clearinghouse for English Language
Acquisition (NCELA) (http://
www.ncela.gwu.edu), an online resource
supported by the Department of
Education’s Office of English Language
Acquisition, provides general
definitions of these terms. Language
acquisition is the process of acquiring a
first or second language. Bilingual
education is an educational program in
which two languages are used to
provide content matter instruction. In
foreign language immersion programs
the foreign language is the vehicle for
content instruction and is not the
subject of instruction. Therefore,
bilingual education does not include
foreign language immersion programs.
Changes: We have added definitions
of the terms ‘‘bilingual education’’ and
‘‘English language acquisition’’ to
§ 686.2(d). These definitions are taken
from the NCELA.
Comment: One commenter asked the
Department to specify what major
would lead to teaching English
acquisition and English as a Second
Language and who would make this
determination.
Discussion: The Department does not
have the authority or expertise to
specify which academic degrees would
prepare an individual to teach in these,
or any other, fields since that is an
academic decision that rests with the
institution.
Changes: None.

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Comment: One commenter sought
clarification of whether a foreign
language is a high-need field and
suggested that a K–12 foreign language
immersion program should be
considered part of the high-need foreign
language field listed in the statute and
regulations.
Discussion: All foreign languages are
high-need fields for purposes of the
TEACH Grant program. We agree with
the commenter that teaching in a foreign
language immersion program would
meet the requirement for teaching in a
high-need field.
Changes: None.
Highly-Qualified
Comment: A couple of commenters
requested that the Department provide
the specific requirements that must be
met to satisfy the criterion for being a
highly-qualified teacher rather than
merely referencing the relevant statutes.
Discussion: The requirements for
being designated ‘‘highly qualified’’ are
very complex and differ for the various
states. The requirement that teachers be
highly-qualified applies to all public
elementary or secondary school teachers
employed by a LEA who teach a core
academic subject. Special education
teachers who teach core academic
subjects are included in this
requirement. In general, ‘‘highly
qualified’’ means that the teacher—
(1) Has obtained full State
certification as a teacher or passed the
State teacher licensing examination,
holds a license to teach in the State, and
has not had certification or licensure
requirements waived on an emergency,
temporary, or provisional basis (special
education teachers must be certified in
special education);
(2) Holds a minimum of a bachelor’s
degree; and
(3) Has demonstrated subject-matter
competency in each of the academic
subjects in which the teacher teaches, in
a manner determined by the State and
in compliance with section 9101(23) of
the Elementary and Secondary
Education Act of 1965, as amended
(ESEA).
The statutory definition of ‘‘highly
qualified’’ includes additional elements
that apply differently to veteran teachers
and new teachers, and to elementary,
middle, and secondary school teachers.
The complete statutory definition of a
‘‘highly qualified’’ teacher is in section
9101(23) of the ESEA and in section
602(10) of the Individuals With
Disabilities Education Act. The
Department’s regulations at 34 CFR
200.56 further define ‘‘highly qualified
teacher.’’ Among other things, 34 CFR
200.56 clarifies when teachers who

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35475

pursue State certification through an
alternative-route program may be
considered fully certified while they
participate in that program. More
guidance on the criterion for being a
highly qualified teacher is available at
http://www.ed.gov/teachers/nclbguide/
improve-quality.html.
Changes: None.
Post-Baccalaureate Program
Comment: A few commenters raised
concerns about the phrase at the end of
paragraph (2) of the definition of postbaccalaureate program that they believe
makes a post-baccalaureate program
offered by an institution that also has an
undergraduate teacher preparation
program ineligible for the TEACH Grant
program. They suggested that the postbaccalaureate program and an
undergraduate teacher education
program offered by the same institution
should both be eligible programs for
TEACH Grant purposes. One of these
commenters noted that some
institutions require their undergraduate
education majors to complete a fifth
year during which they take coursework
necessary to earn a teaching credential.
Discussion: The definition of postbaccalaureate program in § 686.2(d) is
from section 420L(2) of the HEA. That
definition limits the TEACH Grant
eligibility of post-baccalaureate
programs to those offered by institutions
that do not have an undergraduate
teacher preparation program. In the case
of an institution that offers both an
undergraduate teacher preparation
program and a post-baccalaureate
program, the institution would be
eligible, and it could designate its
teacher preparation program as a
TEACH Grant-eligible program. We
understand that some institutions’
teacher preparation programs require
students to complete a postbaccalaureate program after earning a
baccalaureate degree in teacher
education. However, the statute does
not permit these post-baccalaureate
programs to be eligible for the TEACH
Grant program.
Changes: None.
TEACH Grant-Eligible Institution
Comment: One commenter questioned
the exclusion of institutions that fail to
meet financial responsibility standards
but that qualify to participate in all of
the other Title IV, HEA programs under
alternate standards from participation in
the TEACH Grant program.
Discussion: We agree with the
commenter that the same standards
should apply for an institution to
qualify to participate in the TEACH
Grant program as for all the other Title

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IV programs. Using the same standards
will result in consistent treatment across
all programs and reduce the
administrative burden on both
institutions and the Department.
Changes: We have amended the
definition of TEACH Grant-eligible
institution to allow institutions that do
not meet financial responsibility
standards established in 34 CFR part
668, subpart L to participate in the
TEACH Grant program by qualifying
under an alternative standard in 34 CFR
668.175.
Comment: One commenter thanked us
for including in the definition of
TEACH Grant-eligible institution
institutions whose teacher preparation
programs are approved by a State,
include extensive pre-service clinical
experience, and provide pedagogical
coursework or the assistance in the
provision of such coursework.
Discussion: We appreciate the
commenter’s support.
Changes: None.
Comment: One commenter asked that
we clarify what constitutes ‘‘highquality’’ teacher preparation programs
and what ‘‘extensive pre-service clinical
experience’’ entails.
Discussion: The definition of TEACH
Grant-eligible institution in § 686.2(d)
contains four components that
constitute a ‘‘high-quality’’ teacher
preparation program. The components
are: (1) Approval by a cognizant
authority (either accreditation by a
specialized accrediting agency or State
approval); (2) extensive pre-service
clinical experience; (3) direct provision
of pedagogical coursework or assistance
in providing such coursework; and (4)
provision of supervision and support
services to teachers, or assistance in
such provision. Institutions whose
programs are accredited by one of the
specialized accrediting agencies
recognized by the Secretary for the
accreditation of professional teacher
education programs, which are listed on
the Department’s Web site at http://
www.ed.gov/admins/finaid/accred/
accreditation_pg8.html#ed, are
considered to meet the requirements
related to pre-service clinical experience
and pedagogical coursework. While we
did not specifically discuss a minimum
length of time for pre-service clinical
experience during negotiated
rulemaking, a standard will be
necessary from an operational
standpoint so that we can determine
whether or not an institution whose
teacher preparation program is not
accredited by a specialized accrediting
agency meets this requirement.
Accordingly, we reviewed the
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determined that a majority of States
require at least 10 weeks of full-time
pre-service clinical experience, while
some require significantly less and a few
require more. In addition, in testimony
during a public hearing on the TEACH
Grant program, the American
Association of Colleges for Teacher
Education recommended 10 weeks of
full-time pre-service clinical experience
as a minimum. Therefore, we have
adopted 10 weeks of full-time preservice clinical experience, or its
equivalent, as the regulatory standard.
We considered that a program might be
designed so that students would
complete their clinical experience on a
part-time basis and will allow for the
completion of the 10 weeks of full-time
pre-service clinical experience on a
part-time basis.
Changes: We have revised paragraph
(1)(i)(B) of the definition of TEACH
Grant-eligible program in § 686.2(d) to
specify that a teacher preparation
program that is approved by a State
must provide a minimum of 10 weeks
of full-time pre-service clinical
experience, or its equivalent.
Comment: One commenter asked
whether the reference to ‘‘teachers’’ in
paragraph (1)(ii) of the definition of
TEACH Grant-eligible institution refers
to an employed teacher or a student
teacher.
Discussion: The phrase ‘‘provides
supervision and support services to
teachers, or assists in the provision of
services to teachers’’ refers to employed
teachers, not to student teachers.
Faculty and other professional
personnel at institutions with teacher
preparation programs are expected to
share their knowledge with working
teachers as part of their education role.
Changes: None.
Comment: One commenter wondered
what is meant in paragraph (1)(ii)(B) by
the term ‘‘novice’’ in the description of
the types of supervision and support
services an institution might provide to
teachers. The same commenter asked for
further explanation and examples of
ways an institution might meet the
supervision and support services
requirement.
Discussion: In general, a novice is an
individual who is new to a field or
activity. In the case of teachers, a novice
is normally considered to be one who is
involved in the first, second, or third
year of teaching.
The regulations include a few
illustrative examples of the types of
supervision and support services an
institution might provide to teachers.
We believe that an exclusive list would
be too restrictive on institutions. We
expect that institutions with teacher

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preparation programs will be able to
identify other types of services they
provide that satisfy the requirement
based on the illustrative examples.
Changes: None.
Comment: One commenter asked for
more discussion and examples of how a
community college can become a
TEACH Grant-eligible institution. In
particular, the individual wondered
whether the community college must
have an articulation agreement with
each four-year institution to which a
student would transfer.
Discussion: In order to be a TEACH
Grant-eligible institution, a community
college must have an agreement with at
least one four-year institution. The
agreement need not be a formal
articulation agreement. However, the
agreement must demonstrate (1) that the
two-year program offered by the
community college is acceptable for full
credit in that institution’s baccalaureate
teacher education program, or (2) that
the two-year program is acceptable for
full credit in a baccalaureate degree
program in a high-need field at a
TEACH Grant-eligible institution. An
agreement that would demonstrate that
the two-year program is acceptable for
full credit into a baccalaureate degree in
the high-need field of math, for
example, would likely list several
courses that would meet the four-year
institution’s general education
requirements, some courses that could
be electives, and a few lower-level math
courses required for the major. Our
expectation is that a student who
follows a pathway established through
an agreement would not have to take
additional credits beyond the minimum
required for graduation from the fouryear institution.
The agreement is used to establish
institutional eligibility. It is not a
requirement that each student enrolled
in the two-year program attend the fouryear institution with which the
community college has the agreement. A
community college does not have to
have more than one agreement to
establish its eligibility.
Changes: None.
TEACH Grant-Eligible Program
Comment: A couple of commenters
expressed their appreciation that the
regulations permit institutions to define
which programs will be eligible for the
TEACH Grant.
Discussion: We appreciate the
support.
Changes: None.
Comment: One commenter asked that
we explain the criterion of ‘‘fullyqualified’’ teacher in the context of
preparation in an eligible program.

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Discussion: We agree with the
commenter that the definition of
TEACH Grant-eligible program should
make it clear that the program should be
designed to prepare an individual to
teach as a highly-qualified teacher.
Preparation of highly-qualified teachers
is a key component of an eligible
program, but we also recognize that,
given the various pathways a student
might follow to gain the knowledge
needed to become a highly-qualified
teacher, the student may need to
complete more than one program. For
example, a student may earn a
baccalaureate degree in a high-need
field, such as mathematics, and then
enroll in a post-baccalaureate program
for the courses needed to receive a
professional certification or licensing
credential. Subject area content
knowledge and certification are both
components of the definition of ‘‘highlyqualified’’ teacher and, in the situation
just described, a single program would
not provide both. With this clarification,
we agree that the definition of TEACH
Grant-eligible program should include a
reference to the preparation of a highlyqualified teacher.
Changes: We have amended the
definition of a TEACH Grant-eligible
program in § 686.2(d) to clarify that a
TEACH Grant-eligible program must be
designed to prepare an individual to
teach as a highly-qualified teacher.
Comment: Several commenters sought
guidance on the amount of latitude
institutions have in designating eligible
programs. Some wondered if an
institution could designate only its
master’s degree programs, and not its
undergraduate programs, or only its
teacher preparation programs or postbaccalaureate programs as TEACH
Grant-eligible.
Discussion: In making a determination
of which programs to designate as
TEACH Grant-eligible, an institution
may differentiate between its master’s
degree programs and its undergraduate
programs, making only its master’s
degree programs TEACH Grant-eligible.
An institution may also choose to make
only its teacher preparation programs
TEACH Grant-eligible, and not include
any programs in high-need fields.
Changes: None.
Comment: Several commenters asked
whether institutions could limit
participation in the TEACH Grant
program to upper level undergraduate
students. One commenter suggested that
institutions should have the option to
determine whether the first two years of
a four-year program are part of an
eligible program.
Discussion: An institution may limit
participation in the TEACH Grant

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program to students who have formally
declared a major or who have been
formally admitted to the teacher
preparation program. In such cases, the
TEACH Grant-eligible program could
effectively involve only upper-level
undergraduate students and the eligible
program would not include the first two
years of a four-year program. An
institution could also determine that the
first two years are not part of the
TEACH Grant-eligible program.
However, if the institution designates a
program as TEACH Grant-eligible it
cannot further discriminate among
eligible students in that program. If, for
example, an institution designates a
program as TEACH Grant-eligible and
that program begins in the freshman
year, the institution may not limit
TEACH Grant participation to upperlevel undergraduates in the program.
Changes: None.
Comment: One commenter asked
whether a two-year institution could
restrict TEACH Grant-eligibility to
programs with some relationship to
teacher preparation and not include
programs that transfer into four-year
baccalaureate programs that include
high-need majors.
Discussion: An institution may
designate only certain programs as
TEACH Grant-eligible and not designate
others, even though they may prepare a
student to teach in a high-need field.
Changes: None.
Comment: In questioning whether an
institution could require that a student
must have declared an appropriate
major, or have been accepted into a
teacher preparation program, one
commenter asked whether the practice
would cross the line between program
eligibility and student eligibility.
Discussion: Program eligibility—
where the institution may identify,
within the parameters of the regulations,
the scope of institutional programs that
are TEACH Grant-eligible—and student
eligibility—where the institution must
adhere to the eligibility criteria
identified in the regulations—are
closely intertwined in the TEACH Grant
program and there are instances, such as
the situation the commenter describes,
where the line between them is crossed.
It is important to note that a program
might be defined differently for general
Title IV purposes and for TEACH Grant
purposes with the consequence that, for
some period of time, a student could
receive financial assistance from other
Title IV programs, but would not qualify
for a TEACH Grant. Ultimately, it is up
to the institution to decide, based on
regulatory requirements, what programs
are TEACH Grant-eligible and when a

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student is considered to be accepted
into a TEACH Grant-eligible program.
Changes: None.
Comment: One commenter asked
whether an institution can determine
that only some of the programs for
which it currently awards other Title IV
aid are also eligible for TEACH Grant
purposes, even if some programs it does
not wish to make TEACH Grant-eligible
meet the regulatory definition.
Discussion: The institution has that
discretion.
Changes: None.
Comment: Based on a concern that
students will apply for and accept the
TEACH Grant as a way of obtaining
more loan funds with no intention of
fulfilling the Agreement to Serve (ATS),
one commenter asked the Secretary to
provide more guidance, similar to the
list of acceptable Classification of
Instructional Programs (CIP) codes in
the National SMART Grant program, for
students to determine which programs
are TEACH Grant-eligible.
Discussion: We recognize that
institutions may not be able to control
the type of behavior the commenter
describes in all instances. Although an
institution may limit the programs it
designates as TEACH Grant-eligible, an
institution can never know with
certainty whether a student truly
intends to fulfill his or her service
obligation. Since designation of TEACH
Grant-eligible programs is an
institutional decision, we do not plan to
provide more specific guidance or a list
of CIP codes.
Changes: None.
Comment: One commenter asked if,
prior to awarding a TEACH Grant, an
institution could require that a student
submit a plan to the institution
describing the student’s career goal and
intended academic plan to that goal.
Discussion: An institution may
require a student to submit a plan such
as the commenter describes. This may
be particularly helpful in situations
where the student is enrolled in a
program that will not, by itself, enable
the student to begin teaching as a
highly-qualified teacher in a high-need
field. However, the plan by itself would
not establish a student’s eligibility for a
TEACH Grant. A student must be
enrolled in a TEACH Grant-eligible
program to receive a TEACH Grant.
Changes: None.
Comment: A few commenters
wondered whether a program that
prepares a student to teach in a highneed field would have to be in the highneed field in which an individual plans
to teach in meeting the service
obligation, or if it could contribute
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recipient’s knowledge and instructional
capacity in a high-need field. One
commenter asked whether a master’s
degree program that is not a teacher
preparation program would need to
result in a degree in a high-need field to
be considered eligible.
Discussion: An institution has the
authority to determine which of its
programs meet the requirements to be
TEACH Grant-eligible and may
designate any program that contributes
in any way to a student’s preparation to
teach in a high-need field as a TEACH
Grant-eligible program. This approach
would allow, for example, an institution
to designate its Masters in Business
Administration (MBA) Program as a
TEACH Grant-eligible program that will
prepare a student to teach in the highneed field of mathematics, if it
determines that the content of its MBA
program would be good preparation for
teaching mathematics.
Changes: None.
Comment: One commenter asked
whether an institution could consider as
TEACH Grant-eligible a two-year
program that appears unrelated to a
high-need field but that will transfer
fully into a four-year TEACH Granteligible program.
Discussion: We believe that the
institution would have a basis on which
to define such a program as TEACH
Grant-eligible.
Changes: None.
Comment: One commenter inquired
whether a two-year school could offer a
TEACH Grant-eligible postbaccalaureate program.
Discussion: These regulations do not
restrict the authority of an institution of
higher education to offer a postbaccalaureate program. If a community
college offers such a program, the
community college may use this as the
means of establishing its institutional
eligibility for the TEACH Grant program
and would not, therefore, need to enter
into an agreement with a four-year
institution to establish eligibility.
Changes: None.
Comment: One commenter asked
whether a student who returns to the
institution only for teacher certification
courses would be eligible for a grant.
Discussion: A student must be
enrolled in a TEACH Grant-eligible
program, which could be either a postbaccalaureate program of study or a
master’s degree program assuming the
student already has a baccalaureate
degree. If the student is merely taking
courses he or she needs for certification,
but is not enrolled in a TEACH Granteligible program, then the student
would not be eligible for a TEACH
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Changes: None.
Comment: One commenter asked
whether a current teacher who decides
to pursue a master’s degree in a field
that would not result in that teacher
adding a certified area to his or her
teaching credential would be considered
to be enrolled in a TEACH Grant-eligible
program and, if so, if the service
performed on the basis of the
individual’s undergraduate degree could
be used to fulfill the teaching obligation
associated with the TEACH Grant for
the master’s degree.
Discussion: An institution designates
which of its programs are TEACH Granteligible. As long as the student is
enrolled in a TEACH Grant-eligible
program that student could receive a
TEACH Grant. Prior experience in the
field will not strip a student of his or
her eligibility. However, the teaching
service performed prior to enrollment in
the master’s degree program cannot be
used to meet the service obligation
associated with the TEACH Grant. FullTime teaching service while attending
school to obtain a master’s degree would
count toward the service obligation for
any TEACH Grants that were received
for an undergraduate or postbaccalaureate program. The teaching
service performed while the student is
enrolled may not be counted against the
service obligation for the program in
which the student is enrolled because
the statute specifies that the student
must teach ‘‘after completing the course
of study for which the applicant
received a TEACH Grant.’’
Changes: None.
Comment: One commenter asked
whether a four-year baccalaureate
program that does not include an
education component could be
considered TEACH Grant-eligible if a
student is able to transfer out of it after
two years, prior to declaring a major,
into a teacher preparation program at
the same institution or at another
institution with which the student’s first
institution has an agreement.
Discussion: The comment addresses
institutional eligibility and program
eligibility. In regard to institutional
eligibility, an institution that has a
teacher preparation program would not
need to enter into an agreement with
another institution to be a TEACH
Grant-eligible institution. The
institution could establish eligibility on
the basis of its teacher preparation
program, assuming that program meets
the requirements contained in
paragraph (1) of the definition of
TEACH Grant-eligible institution in
§ 686.2(d).
In regard to program eligibility, it is
not a requirement that a program

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include a teacher education component
to be designated a TEACH Grant-eligible
program. An institution may designate a
program as TEACH Grant-eligible if it
prepares an individual to teach as a
highly-qualified teacher in a high-need
field.
In this example, if the institution has
designated both its program that does
not include a teacher education
component and its teacher preparation
program as TEACH Grant-eligible, and
the student is admitted to its teacher
preparation program in the third year of
undergraduate study, then the student
would be eligible for a TEACH Grant for
a total of four years. Since both of the
programs in this example are TEACH
Grant-eligible, the student could receive
a TEACH Grant for each year of
enrollment in the baccalaureate program
without the education component and
for each year of enrollment in the
program with the teacher education
component.
Changes: None.
Teacher and Full-Time Teacher
Comment: One commenter asked
what a substitute teacher would need to
do to meet the requirement of teaching
full-time and other aspects of the service
obligation.
Discussion: A substitute teacher
would need to satisfy the same
requirements as a regular teacher as
described in § 686.12(b)(1), (2), and (3).
The substitute teaching service must be
in a low-income school and the
substitute must teach a majority of
courses in a high-need field, as a highlyqualified teacher, for it to count toward
meeting the service obligation. The
substitute teacher must teach enough to
meet the standard used by the State in
defining full-time employment as a
teacher. He or she could satisfy the
requirement of teaching full-time by
teaching in more than one low-income
school and demonstrating that the
combined teaching service was the
equivalent of full-time. The substitute
teacher would need to provide
documentation as provided in § 686.40.
Changes: None.
Comment: One commenter noted that
special education teachers and reading
specialists often serve other teachers as
a resource or as a literacy coach and
inquired whether such individuals
would be considered teachers for
purposes of fulfilling the service
obligation.
Discussion: The definition of
‘‘teacher’’ specifically includes special
education teachers and reading
specialists. Service performed by special
education teachers and reading
specialists, such as serving as a literacy

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coach or resource to another teacher,
either in the classroom or in a
classroom-like setting, meets the
definition of teacher. In order to meet
the requirements of the service
obligation, special education teachers
and reading specialists must spend the
majority of time teaching in a classroom
or classroom-like setting, though they
may also serve as a resource for other
teachers.
Changes: None.
Duration of Student Eligibility (§ 686.3)
Comment: One commenter asked
whether a student who already has
earned a baccalaureate degree in a nonTEACH Grant-eligible program could be
considered eligible for a TEACH Grant
if the student enrolled in a TEACH
Grant-eligible baccalaureate degree
program, since this would be that
student’s first such baccalaureate
degree. The commenter asked the same
question about post-baccalaureate
programs.
Discussion: Section 420M(d)(1) of the
HEA provides that a student may
receive grants for the period required for
the completion of the first
undergraduate or post-baccalaureate
course of study. In reviewing proposed
§ 686.3, we have determined that § 686.3
could suggest that a student who
already has a baccalaureate degree in a
non-TEACH Grant-eligible program
would be eligible for a TEACH Grant if
the student enrolled in a TEACH Granteligible baccalaureate degree program.
However, that is not what we intended
so we have clarified the regulations. An
undergraduate student can get a TEACH
Grant only for their first baccalaureate
degree.
Post-baccalaureate programs are by
definition TEACH Grant-eligible. A
student can get a TEACH Grant for
completion of only one postbaccalaureate program.
Changes: We amended § 686.3(a) to
clarify that a student who already has
completed a baccalaureate or postbaccalaureate program of study and has
enrolled in a TEACH Grant-eligible
baccalaureate or post-baccalaureate
program of study will not be able to
receive a TEACH Grant.
Comment: A commenter asked
whether a student who has completed
the requirements for teacher
certification but elects to remain
enrolled in the institution would
continue to be eligible to receive
TEACH Grants.
Discussion: If a student has completed
the requirements for teacher
certification but remains enrolled in the
institution, the student’s eligibility for
further TEACH Grants would depend on

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whether the student is still considered
enrolled in his or her TEACH Granteligible program. If the student
completed the requirements for the
TEACH Grant-eligible program’s degree
or certificate, the student would no
longer be eligible.
Changes: None.
Institutional Participation (§ 686.4)
Comment: One commenter expressed
appreciation that participation in the
TEACH Grant program is optional for
institutions.
Discussion: We appreciate the
support.
Changes: None.
Comment: One commenter suggested
that the regulations should provide that
if an institution ceases to participate in
the TEACH Grant program, the TEACH
Grant recipients at that institution
would not be required to repay any
TEACH Grant funds they received
because it is the institution, not the
student, that has withdrawn from the
program.
Discussion: Whether or not the
institution continues to participate in
the TEACH Grant program, a grant
recipient is responsible for fulfilling the
terms of the ATS that he or she signed.
The student would still be able to
continue a program of study to become
a teacher, even if the institution no
longer participated in the TEACH Grant
Program, though the student would not
receive additional TEACH Grants for
that program. In addition, the student
would also have the option to transfer
to another institution to get a teaching
credential. If the recipient fails to meet
the requirements of the ATS, the
TEACH Grants will convert to a Federal
Direct Unsubsidized Loan.
Changes: None.
Application (§ 686.10)
Comment: One commenter supported
the Department’s use of the FAFSA as
the application for a TEACH Grant.
Discussion: We appreciate the
commenter’s support.
Changes: None.
Eligibility To Receive a Grant (§ 686.11)
Comment: Several comments were
received on how admissions tests are
treated as part of student eligibility for
a TEACH Grant. One commenter asked
whether an institution must first
determine whether a student achieved a
score above the 75th percentile on at
least one of the batteries of a
standardized admission test before
determining TEACH Grant eligibility
based on the student’s grade point
average (GPA). One commenter
requested restricting admission test

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scores by educational level, while
another commenter supported the
approach in the proposed regulations
regarding how admission test scores are
considered as part of student eligibility.
Another commenter wanted to know
how to determine a home-schooled
student’s eligibility if the institution
does not require an admissions test.
Another commenter asked whether a
test used for admission is acceptable for
the 75th percentile determination even
if it is also used as a placement test.
Clarification on which nationallynormed tests qualify a student for a
TEACH Grant and how a test is
determined to be nationally-normed was
also requested by a commenter. Finally,
one commenter asked whether, in lieu
of test score submissions by the testing
entity, a student may submit
documentation of test scores directly to
the financial aid office.
Discussion: Section
420N(a)(2)(A)(ii)(II) of the HEA requires
an institution to determine whether the
student displayed high academic
aptitude by scoring above the 75th
percentile of scores on at least one of the
batteries from a nationally-normed
standardized admissions test and does
not restrict the use of admission test
scores by undergraduate or graduate
educational level. Because the test
scores are intended to be a measure of
high academic aptitude without being
associated with a particular educational
level, the Department does not believe
that restricting qualification for a
TEACH Grant by test score by
educational level is appropriate. If the
student did not achieve a qualifying test
score, an otherwise eligible student may
qualify based on the applicable GPA
requirements.
The student’s qualifying test score
does not need to be used by the
institution as an admissions test at that
school. In addition, a student may
qualify based on a score on an
admissions test that doubles as a
placement test at the institution. While
a home-schooled student may qualify by
scoring above the 75th percentile on a
standardized admissions test, he or she
may also qualify based on his or her
high school GPA as documented by the
student’s parent or other cognizant
authority. Any student who does not
qualify by test score or GPA is not
eligible for a TEACH Grant.
All nationally-normed tests are not
eligible to qualify a student—only
nationally-normed admission tests
qualify. An admissions test is
considered to be nationally-normed if
the norming sample is nationallyrepresentative, that is, individual
student test performance can be

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compared to a nationally-drawn peer
sample. For documentation purposes, a
student may submit qualifying test
scores directly to the financial aid office
in lieu of having the testing entity send
the test scores to the institution.
However, if the institution has reason to
believe that the test scores submitted
directly by the student are incomplete
or inaccurate, the institution must
request test scores from the testing
entity.
Changes: None.
Comment: Three commenters
expressed concern about the GPA
requirement to receive a TEACH Grant.
One believed that the required 3.25 GPA
is too high. Another commenter
suggested that students who qualified
for a TEACH Grant by meeting the
admission test option should still have
to meet the 3.25 cumulative GPA, or
numeric equivalent, through the most
recently completed payment period that
is required of students who did not
qualify under the admission test option.
Another commenter recommended that
GPA be checked once per year, not once
each term.
Discussion: Under section
420N(a)(2)(A)(ii)(I) of the HEA,
achieving a 3.25 GPA on a 4.0 scale
allows an otherwise eligible student
who did not qualify via an
undergraduate, postbaccalaureate, or
graduate school admissions test score to
qualify for a TEACH Grant. The statute
does not require students who qualified
using the admission test score option to
maintain a 3.25 GPA in the eligible
program, but does require that a student
who qualified using the 3.25 cumulative
GPA option to continue to maintain a
GPA of at least 3.25 on a 4.0 scale. To
document that such a student continues
to meet the 3.25 GPA eligibility
requirement, § 686.11(a)(1)(v) stipulates
that the institution must check the
student’s GPA for the most recently
completed payment period by the
institution prior to disbursement.
Changes: None.
Comment: One commenter was
concerned that the academic
requirements to receive a TEACH
Grant—qualifying test scores or GPA—
would impose an additional burden on
financial aid officers.
Discussion: Section
420N(a)(2)(A)(ii)(I) and (II) of the HEA
established the qualifying admission
test scores and GPA requirements for
receiving a TEACH Grant that were
reflected in the proposed regulations.
Institutions are required to implement
these requirements. The regulations do
not specifically stipulate, however, that
financial aid officers make the academic
determinations. Rather, institutions

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should follow their own institutional
policies and procedures to ensure that
these student eligibility requirements
are properly administered.
Changes: None.
Comment: One commenter requested
clarification on the methods by which a
former teacher may qualify for a TEACH
Grant.
Discussion: Under § 686.11(b), a
former teacher is eligible for a TEACH
Grant for a master’s degree program or
an alternative certification program as
part of a master’s degree program. In
addition, a former teacher can qualify
under § 686.11(a) for an eligible
undergraduate, post-baccalaureate, or
graduate degree program if he or she
meets the academic requirements.
Changes: None.
Agreement To Serve (§ 686.12)
Comment: Many commenters were
concerned that the basic elements of the
ATS would be difficult for most TEACH
Grant recipients to satisfy, thereby
increasing the probability that the
majority of TEACH Grants would
convert to Federal Direct Unsubsidized
Loans. The commenters stated that it
was not appropriate to expect students,
especially lower classmen who either
have not or cannot declare a major, to
make a four-year commitment to serve
in a low-income school as a highlyqualified full-time teacher in a highneed field at such a young age. The
commenters cited the frequency with
which students change majors or career
goals upon exposure to coursework or,
even later, after exposure to teaching
experience. One commenter suggested
that the Department include, in the
ATS, the fact that the Congressional
Budget Office has projected that 80
percent of TEACH Grants will convert to
Federal Direct Unsubsidized Loans.
Discussion: The teaching service
requirements contained in the ATS and
described in § 686.12(b) are mandated
by section 420N(b) and (c) of the HEA.
In order to receive a TEACH Grant, the
HEA requires that each TEACH Grant
recipient agree to serve as a full-time
teacher for a total of not less than four
academic years within eight years of
completing the course of study for
which a TEACH Grant was received in
a low-income school as a highlyqualified teacher in a high-need field.
The HEA further requires that a grant
recipient document each year of his or
her teaching service in the form of a
certification by the chief administrative
officer of the school in which the
recipient is teaching. Lastly, the HEA
provides that if the recipient fails or
refuses to carry out the service
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are treated as a Federal Direct
Unsubsidized Loan with interest
accruing from the date that each TEACH
Grant was disbursed. While we
understand the commenters’ concerns,
the Secretary does not have the
authority to change statutory
requirements. We note, however, that
the ATS that a TEACH Grant recipient
must sign each year before receiving a
TEACH Grant contains all of the terms
and conditions a recipient must meet in
order to prevent the grant from
converting to a Federal Direct
Unsubsidized Loan. Finally, the
Secretary does not see the merit of
including Congressional Budget Office
projections in the ATS.
Changes: None.
Comment: Many commenters
expressed concern that the regulations
in § 686.12(b)(1) do not provide for
partial fulfillment of a TEACH Grant
recipient’s ATS based on completion of
less than four years of creditable
teaching service. The commenters
believed that requiring a teacher who
fails to meet any part of the teaching
service obligation to repay the entire
amount of the grant award as a Federal
Direct Unsubsidized Loan was unfair
and punitive. The commenters strongly
recommended that we allow TEACH
Grant recipients to partially fulfill their
ATS based on the number of years
taught. For example, if a grant recipient
received $16,000 in TEACH Grants and
completed two years of creditable
teaching service in accordance with his
or her ATS, the grant recipient would
owe $8,000 in TEACH Grants that
would convert to Federal Direct
Unsubsidized Loans.
Other commenters did not believe
that a student who receives TEACH
Grants for only one award year while
completing coursework necessary to
begin a career in teaching should be
required to perform four years of
creditable teaching service in order to
keep the TEACH Grants from converting
to Federal Direct Unsubsidized Loans.
The commenters believed that the
teaching service obligation should be
directly proportional to the number of
years of TEACH Grant support received
by a student. For example, if a student
receives TEACH Grants for two award
years, the teaching service obligation
associated with the receipt of grant
funds would also be two years.
Discussion: Section 420N(b)(1) of the
HEA states that a TEACH Grant
recipient must serve as a full-time
teacher for a total of not less than four
academic years within eight years after
completing the course of study for
which the applicant received a TEACH
Grant. The Secretary does not have the

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authority to change statutory
requirements to allow for partial
fulfillment of an ATS based on a
teaching service obligation that is
directly proportional to the number of
years of TEACH Grant support received
by a student.
Changes: None.
Comment: One commenter stated that
requiring a TEACH Grant recipient to
perform creditable teaching service in a
low-income elementary or secondary
school is a disservice to such schools
because inexperienced teachers trying to
satisfy their ATS would be teaching in
an environment where more
experienced teachers are needed.
One commenter recommended that
the final regulations provide relief to a
TEACH Grant recipient who is unable to
fulfill his or her ATS because there are
no low-income elementary or secondary
schools within a reasonable distance of
the grant recipient’s residence or
because the grant recipient has not been
hired by a low-income school.
Finally, one commenter asked
whether all of the elementary or
secondary schools at which a grant
recipient teaches must be considered
low-income to satisfy the ATS if the
grant recipient’s full-time status as a
teacher is achieved by employment at
more than one school.
Discussion: There is a shortage of
teachers in elementary and secondary
low-income schools that experienced
teachers have not filled. The TEACH
Grant program was established to
address this need, among others, by
providing incentives in the form of
grants of up to $4,000 per year to
students who make a commitment to
teach in a public or private non-profit
elementary or secondary low-income
school.
We believe that providing relief to a
TEACH Grant recipient who does not
live within a reasonable distance of a
low-income school or who is not hired
by a low-income school would be
contrary to the intent of the TEACH
Grant program. We believe that under
the regulations, TEACH Grant recipients
will receive enough information to make
an informed choice regarding their
ability to meet the requirements of the
ATS, including the requirement to teach
in a low-income school. Section 686.32
requires that a TEACH Grant recipient
receive extensive counseling before
grant funds are disbursed each year that
emphasizes that by receiving TEACH
Grant funds, a student is committing to
a teaching service obligation. Both
initial and exit counseling requirements
in § 686.32(a)(3)(ii) and (c)(4)(iii),
respectively, require a school to provide
grant recipients with information on

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how to access the Directory of LowIncome Schools so that TEACH Grant
recipients can familiarize themselves
with the name and location of every
designated low-income school in the
United States. Moreover, section
420N(b)(1)(A) of the HEA allows a
TEACH Grant recipient eight years to
satisfy his or her teaching service
obligation of four years. This eight-year
timeframe builds in four years for
TEACH Grant recipients who do not
begin their teaching service immediately
and provides them with ample time to
locate and apply to teach in a lowincome elementary or secondary school.
Finally, all of the elementary or
secondary schools at which a grant
recipient teaches must be designated as
low-income to satisfy the ATS if the
grant recipient’s full-time status as a
teacher is achieved by employment at
more than one school. This policy is
consistent with the policy applied to
borrowers in the Title IV, HEA loan
programs with regard to teacher loan
forgiveness.
Changes: None.
Comment: One commenter suggested
that the Secretary include the definition
of ‘‘highly-qualified teacher,’’ or a link
to a Web site that contains the
definition, in the ATS developed by the
Department in accordance with § 686.12
so that TEACH Grant recipients know
what requirements they must meet to be
considered a highly-qualified teacher
and to satisfy their teaching service
obligation.
Discussion: The Secretary agrees with
the commenter that it is important for
TEACH Grant recipients to have access
to the definition of ‘‘highly-qualified
teacher.’’ We will ensure that the initial
version of the ATS includes the
appropriate statutory cites so that a
TEACH Grant recipient can research the
definition of highly-qualified teacher.
We will consider other options for
providing this information when the
Agreement is revised in the future.
Changes: None.
Comment: One commenter supported
the provisions of § 686.12(c)(1) that
allow creditable teaching service to
apply to more than one ATS.
One commenter believed that
§ 686.12(c)(1) should allow a student to
incur only one ATS, instead of one ATS
for each program of study for which a
student received TEACH Grants, if a
student must complete both a
baccalaureate and a post-baccalaureate
degree in order to begin a career in
teaching.
Another commenter requested that we
clarify whether a teacher who received
Stafford Loans as an undergraduate and

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who successfully completed five years
of teaching service to obtain loan
forgiveness on those loans could use the
same teaching service to immediately
satisfy an ATS associated with the
receipt of TEACH Grants for a
subsequent master’s degree.
Discussion: The Secretary agrees that,
under certain circumstances, it is
appropriate to apply creditable teaching
service to more than one ATS and
appreciates the commenter’s support for
this provision. For instance, if a grant
recipient completes a TEACH Granteligible program at a TEACH Granteligible institution and immediately
enrolls in another TEACH Grant-eligible
program at a TEACH Grant-eligible
institution before beginning a career in
teaching, the recipient may request a
suspension of the eight-year time period
under § 686.41(a)(1) for the period of
enrollment in the subsequent program
and upon completion of the subsequent
program, apply all qualified teaching
service to both service obligations.
Another example would be when a
grant recipient completes a TEACH
Grant-eligible program at a TEACH
Grant-eligible institution and begins
qualified teaching service to meet the
service obligation before enrolling in a
subsequent TEACH Grant-eligible
program. In this case, the recipient may
request a suspension of the eight-year
time period associated with the first
service obligation under § 686.41(a)(1)
for the period of enrollment in a
subsequent program and, upon
completion of the subsequent program,
apply qualified teaching service
performed after the completion of the
subsequent program to both service
obligations. The qualified teaching
service performed before the suspension
would count only toward fulfillment of
the first service obligation.
The requirement in § 686.12(c)(1) that
a TEACH Grant recipient must complete
an ATS for each program of study for
which the recipient received a TEACH
Grant is based on section 420N(b)(1)(A)
of the HEA. The Secretary does not have
the authority to change a statutory
requirement.
Lastly, a TEACH Grant recipient can
use only prospective, creditable
teaching service performed after the
student completed or ceased to be
enrolled in the program for which the
TEACH Grant was received to satisfy the
requirements of the ATS, not teaching
service performed before or during the
time the student received a TEACH
Grant.
Changes: None.
Comment: One commenter believed
that § 686.12(b)(2), which requires a
TEACH Grant recipient to annually

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submit documentation of creditable
teaching service in the form of a
certification by a chief administrative
officer of the school, should provide
protection to TEACH Grant recipients
who fail to provide such documentation
in a timely manner.
Discussion: A TEACH Grant recipient
must annually submit documentation of
his or her teaching service or intent to
teach within a timeframe necessary to
keep the TEACH Grants from converting
to Federal Direct Unsubsidized Loans in
accordance with the provisions of
§§ 686.40 and 686.43. The Secretary
believes that these timeframes are
reasonable for grant recipients to meet
and protect the Federal fiscal interest by
allowing for the conversion of TEACH
Grants to loans when the Secretary
cannot verify or document a grant
recipient’s intent to satisfy the ATS.
Changes: None.
Comment: Several commenters
recommended that the Secretary amend
§ 686.12(d) to allow a TEACH Grant
recipient who completes a TEACH
Grant-eligible program in a field that is
listed in the Nationwide List to satisfy
the requirement to teach in a high-need
field if the high-need field in which he
or she prepared to teach is no longer
listed in the Nationwide List for the
State in which the grant recipient begins
teaching. The commenters believed that
a TEACH Grant recipient, who in good
faith undertakes the coursework
necessary to teach in a designated highneed field, should not be punished for
circumstances that are beyond his or her
control.
Discussion: The HEA specifically
states in section 420N(b)(1)(C) that a
TEACH Grant recipient must ‘‘teach’’ in
a high-need field in accordance with
their ATS. We do not have the authority
to allow a TEACH Grant recipient who
completes a TEACH Grant-eligible
program in a field that is listed in the
Nationwide List to satisfy the
requirement to teach in a high-need
field if the high-need field in which he
or she prepared to teach is no longer
considered a high-need field in the
recipient’s state and is no longer
included in the Nationwide List for the
State in which the grant recipient begins
teaching. If the high-need field in which
a TEACH Grant recipient prepared to
teach is included in the Nationwide List
for a State other than the State in which
the grant recipient planned to teach, the
grant recipient may apply to teach in
that State in order to fulfill his or her
ATS.
Changes: None.
Comment: Several commenters were
concerned that TEACH Grant recipients
who intend to become elementary

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school teachers may not be able to meet
their teaching service obligation
because, as elementary school teachers,
they may not be able to teach the
majority of their classes in high-need
fields as required by § 686.40(c)(1). The
commenters suggested that § 686.12
specifically state how elementary school
teachers can demonstrate that they are
teaching in high-need fields.
Another commenter suggested that,
because the purpose of the TEACH
Grant program is to provide an incentive
to get highly-qualified teachers into lowincome schools, it would be consistent
with this purpose for the Secretary to
define all classroom teaching in
elementary schools that includes math,
science, and other defined high-need
fields as qualifying teaching service in
a high-need field.
One commenter suggested that the
ATS include information alerting
TEACH Grant recipients who intend to
become elementary school teachers that
they may not be able to meet their
teaching service obligation to teach the
majority of their classes in high-need
fields so that students in a TEACH Grant
eligible program can make a more
informed decision regarding receipt of a
grant.
Discussion: Section 420N(b)(1)(C) of
the HEA requires that a TEACH Grant
recipient enter into an agreement in
which he or she commits to teach in
mathematics, science, a foreign
language, bilingual education, special
education, as a reading specialist, or in
any other high-need field documented
by the Federal government or a State or
local government and approved by the
Secretary in exchange for the grant. In
recognition of the fact that TEACH
Grant recipients who intend to become
elementary school teachers may not be
able to meet the requirement to teach in
a high-need field because of the nature
of elementary school curriculum,
§§ 686.12(b)(1)(iii) and 686.40(c)(1)(i)
and (ii) permit a teacher to fulfill the
requirement to teach in a high-need
field if the majority of classes taught are
in a high-need field. We believe that
these provisions sufficiently address
how an elementary school teacher can
meet the requirements of his or her
ATS.
Because the statute requires a TEACH
Grant recipient to teach in a high-need
field, we do not believe that we have the
authority to interpret this provision to
consider all classroom teaching in
elementary schools that includes math,
science, and other defined high-need
fields as qualifying teaching service in
a high-need field.
We also do not believe that it is
appropriate to include a warning in the

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ATS that TEACH Grant recipients who
intend to become elementary school
teachers may not be able to meet their
teaching service obligation unless they
teach the majority of their classes in
high-need fields. Instead, we will make
it clear in the ATS that a teacher may
fulfill the requirement to teach in a
high-need field if the majority of classes
taught are in a high-need field.
It is important to note in this
discussion that an elementary school
teacher can also satisfy the requirement
to teach in a high-need field if the State
in which he or she teaches designates
‘‘elementary school teachers’’ as a highneed field. In this case, the designation
alone satisfies the requirement to teach
in a high-need field, regardless of
whether the majority of the classes
taught by the grant recipient were taught
in a high-need field. An elementary
school teacher can also satisfy the
requirement to teach in a high-need
field if he or she is a full-time teacher
in mathematics, science, a foreign
language, bilingual education, or special
education or is a reading specialist.
Changes: None.
Submission Process and Deadline for a
SAR or ISIR (§ 686.20)
Comment: One commenter asked how
an institution would have an official
EFC computed by the Central Processing
System (CPS) and an accurate EFC
without having a valid SAR or valid
ISIR. The commenter also questioned
whether the intent of the proposed
regulations was to provide for an
institutional or third-party need
analysis.
Discussion: As with the other Title IV,
HEA programs, the EFC must be
calculated using the Federal
methodology need analysis provided in
Title IV, Part F of the HEA (Federal
Methodology). An institution may
receive an official EFC computed by
CPS that is not based on accurate
information. To determine the amount
of a student’s TEACH Grant in
accordance with § 686.21(c), an
institution would need an EFC based on
accurate information, even if the EFC is
not computed by CPS. In lieu of a CPScalculated EFC based on information
from a valid SAR or valid ISIR, an
institution may hand-calculate a Federal
Methodology EFC based on accurate
information, or the institution may use
a vendor’s product to calculate a Federal
EFC. An institution may not use the EFC
of a need analysis methodology other
than the Federal Methodology.
Changes: None.

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Calculation of a Grant and Calculation
of a Grant for a Payment Period
(§§ 686.21 and 686.22)
Comment: One commenter was
concerned with the relationship
between payments for payment periods
and a student’s TEACH Grant
Scheduled Awards. The commenter
cited the example of a program that
operates on a quarter schedule with
three quarters in the fall through spring
and a summer quarter, each with 11
weeks of instructional time, and the
summer quarter is treated as part of the
prior award year. In this example, the
institution has defined its academic year
as being 44 weeks of instructional time
and 48 quarter hours and uses the
payment methodology described in
§ 686.22(b), commonly referred to as
Formula 1. A student attends three
quarters starting in the fall quarter, fulltime for the first quarter and half-time
for the winter and spring quarters, and
receives TEACH Grant disbursements of
$1,000, $500, and $500 for each of the
respective terms from an initial
Scheduled Award. The commenter
questioned whether the payment for
full-time attendance in the following
summer term would be $1,000 or the
$2,000 balance of the Scheduled Award
and, if the amount was $1,000, what
would be the disposition of the
remaining $1,000 of the student’s
Scheduled Award and future Scheduled
Awards.
Discussion: In a manner similar to the
Academic Competitiveness Grant (ACG)
and National SMART Grant programs,
and unlike the Federal Pell Grant
program, a TEACH Grant Scheduled
Award is not limited to an award year
and remains available to a student until
that Scheduled Award is completely
disbursed. Payments of a Scheduled
Award are calculated by payment
period as provided in §§ 686.22 and
686.25.
In the commenter’s example, the
student would receive a $1,000
disbursement in the summer term, the
payment for the payment period as
calculated under § 686.22(b). The
remaining balance of $1,000 from the
Scheduled Award remains available for
the next payment period in which the
student enrolls. As an example, assume
a student is otherwise TEACH Granteligible and enrolls in the subsequent
fall and winter quarters as a half-time
student and then in the spring quarter
as a full-time student. The student
would receive $500 payments for the
fall and winter quarters from the initial
Scheduled Award partially disbursed in
the prior award year and would
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Award. In the subsequent spring
quarter, the student would receive an
initial $1,000 disbursement from the
student’s next Scheduled Award.
Changes: None.
Comment: One commenter asked for
clarification of the relationship between
the payment methodologies to calculate
a grant under §§ 686.22 and 686.25 and
the requirement that the grant, in
combination with Federal and other
student financial assistance that a
student may receive, may not exceed the
Title IV, HEA program cost of
attendance (COA). The commenter also
questioned the relationship between
annual awards that take into account
part-time attendance and full-time COA
and part-time COA in determining the
amount of a student’s TEACH Grant.
The commenter suggested that it would
be simpler to follow the model of
determining payments under the
campus-based programs (i.e. , Federal
Perkins Loan Program and Federal
Supplemental Educational Opportunity
Grant Program).
Discussion: An institution is required
to calculate a TEACH Grant payment for
each payment period. However, if the
student’s TEACH Grant in combination
with other aid for the enrollment period
covered by the aid, e.g. , a one-term
period of enrollment, exceeds the
student’s COA for the enrollment
period, the payment of the TEACH
Grant must be reduced. This same
principle would hold true in the
treatment of a part-time COA in
combination with a part-time TEACH
Grant payment for a period of
enrollment covered by the aid and COA.
Section 401M(c)(1) of the HEA
requires that a student’s TEACH Grant
payments must be reduced if the
student is not attending full-time. The
amount of the grant is reduced in
proportion to the degree to which the
student is not attending on a full-time
basis. Similar adjustments must be
made in the Federal Pell Grant, ACG,
and National SMART Grant programs.
There is no comparable adjustment
required under the HEA for the campusbased programs. These regulations,
therefore, use the same methodologies
for calculating a payment for a payment
period as do the Federal Pell Grant,
ACG, and National SMART Grant
programs.
Changes: None.
Comment: One commenter sought
confirmation that it is the institution’s
option to use the grant as a replacement
for EFC.
Discussion: Under § 686.21(d), an
institution is not required to replace a
student’s EFC with a TEACH Grant. If
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EFC with a TEACH Grant, the amount
of the grant that exceeds the student’s
EFC is considered estimated financial
assistance under 34 CFR 673.5(c).
Changes: None.
Determination of Eligibility for Payment
(§ 686.31)
Comment: Several commenters
expressed concern about the
requirement in § 686.31(a)(2) that for
each payment period, an institution may
pay a TEACH Grant to an eligible
student only after determining that the
student has completed the relevant
counseling. The commenters interpreted
this provision to require recipients to
receive counseling prior to each grant
disbursement, which they believe to be
excessive.
Discussion: We intended
§ 686.31(a)(2) to require institutions to
ensure that initial counseling is
conducted prior to making the first
disbursement of the student’s first
TEACH Grant and subsequent
counseling is conducted prior to making
the first disbursement of any subsequent
TEACH Grant. Because these counseling
requirements are triggered only by the
first disbursement of a TEACH Grant,
they are only required annually. For
clarity, we have amended § 686.31(a)(2)
to reflect the annual nature of the
counseling.
Changes: Section 686.31(a)(2) is
amended by adding the words ‘‘initial
or subsequent’’ before ‘‘counseling’’.
Counseling Requirements (§ 686.32)
Comment: We received several
comments suggesting that the TEACH
Grant counseling requirements reflected
in § 686.32 will place an additional
burden on financial aid offices. Some
commenters requested that the
Department develop counseling
materials for institutions to use or
develop and make available to students
applying for a TEACH Grant an online,
interactive counseling program. One
commenter requested that the
Department make an online counseling
program a priority so that it could be
available for the 2008–2009 award year.
A few commenters suggested that
required counseling could be
electronically connected to the ATS,
which the student will complete online.
Another commenter noted that many
students already resist current financial
aid counseling that is offered and, for
that reason, they do not believe that
students will embrace the additional
TEACH Grant counseling requirements.
One commenter supported
comprehensive counseling while
another commenter asked the
Department to eliminate the subsequent

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counseling requirements in § 686.32(b)
altogether.
One commenter asked the Department
to add a requirement that students have
documentation, either from the
Department or from a college financial
aid office, showing that they completed
the required counseling before an
institution can disburse the TEACH
Grant. Another commenter asked the
Department to clarify what the
timeframe is in which counseling must
be provided to students. Finally, one
commenter noted that there are slight
differences between the TEACH Grant
counseling requirements and the
Stafford Loan counseling requirements
and asked the Department to clarify
whether or not these differences are
intentional.
Discussion: We appreciate the
administrative burden associated with
the counseling requirements, but we
strongly believe that extensive
counseling is necessary given the
complex nature of the TEACH Grant
program and, in particular, the potential
for a grant under this program to convert
to a Federal Direct Unsubsidized Loan.
As mentioned in the preamble to the
NPRM, the Department and the nonFederal negotiators who participated in
the negotiated rulemaking sessions for
the TEACH Grant program agreed that
students should be given as much
information as possible about the
TEACH Grant program and its
requirements. The Department believes
that providing initial counseling for
students is necessary so that each
TEACH Grant recipient understands the
rights and responsibilities that are
attached to a grant award. Subsequent
counseling sessions remind students of
those rights and responsibilities. Exit
counseling reminds students about their
service obligation and gives them
information similar to that given to loan
recipients when they leave school.
Students who do not complete the
initial or subsequent counseling
requirements, whichever is appropriate,
will not be eligible to receive a TEACH
Grant. Thus, students who are interested
in receiving a TEACH Grant will have
to complete the annual counseling
requirement regardless of whether or
not they agree with the requirement.
The Department intends to provide
online, interactive counseling that will
be connected to the ATS. Once this
online counseling is in place, students
will be required to complete it before
they can access and sign the ATS.
Because students who do not complete
an ATS are not eligible to receive a
TEACH Grant, this ensures that all
recipients will have completed the
counseling. Unfortunately, the

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Department will not be able to provide
online counseling during the 2008–2009
award year, but we are hopeful that online counseling will be available
beginning with the 2009–2010 award
year.
Under § 686.32, an institution is
required to ensure that initial,
subsequent, and exit counseling is
provided, as appropriate, to each
TEACH Grant recipient. Institutions,
therefore, will be required to provide
counseling until the Department makes
an online TEACH Grant counseling
program available. At that time, to fulfill
the requirements of § 686.32,
institutions will be responsible not for
providing the counseling, but instead
for ensuring that the necessary
counseling has been provided (i.e.,
obtaining documentation evidencing
that the student received appropriate
counseling).
To provide institutions as much
flexibility as possible, the Department
has decided not to require institutions
to collect a specific form from students
to show that they have completed the
required counseling. However,
institutions can require their students to
submit a specific form, if they choose.
Once the Department begins to offer
online counseling with the ATS,
students will be able to print off a copy
of the ATS, which could serve as proof
that they have completed the online
counseling (they will be unable to
access and sign the ATS without first
completing the online counseling
session). If it chooses, an institution can
request that each student provide a copy
of his or her completed ATS for that
student’s file. Also, nothing in the
regulations prohibits institutions from
requiring students to receive additional
in-person counseling, prior to receiving
a TEACH Grant.
The regulations indicate that an
institution must ensure that a student
receives either initial or subsequent
counseling, whichever is appropriate,
prior to the first disbursement of the
grant award. While the Department
would prefer that institutions provide
initial and subsequent counseling to
students before the students sign an
ATS, we realize that this could be
difficult and so the Department did not
specify in the regulations the specific
timeframe in which counseling must
take place. We believe that this gives
institutions flexibility and will allow
them to provide counseling at a time
that best suits their needs and the needs
of their students so long as students
receive counseling before the first
disbursement of the TEACH Grant.
The Department used the current
counseling requirements for the William

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D. Ford Federal Direct Loan Program as
an example when formulating the
TEACH Grant counseling requirements.
However, the requirements for the
Direct Loan Program and the TEACH
Grant program do differ slightly. These
differences are intentional. For example,
the initial counseling requirements for
the Direct Loan Program state that the
initial counseling must explain the use
of a Master Promissory Note (MPN)
whereas, because the TEACH Grant
program does not use a MPN, this
requirement is not included in the
TEACH Grant counseling requirements.
Also, the exit counseling section of the
Direct Loan regulations states that the
exit counseling must inform the student
borrower of the average anticipated
monthly payment amount based on the
student’s overall indebtedness or on the
average indebtedness of Direct
Subsidized Loan and Federal Direct
Unsubsidized Loan borrowers at the
same school or in the same program of
study. In the TEACH Grant regulations
the Department requires that exit
counseling inform the student of the
average anticipated monthly amount
based only on the student’s TEACH
Grant indebtedness, which could be in
addition to any other loan indebtedness
that the student may incur. This is due
to the fact that institutions will not have
an average indebtedness of TEACH
Grant recipients. Most TEACH Grants
that convert to a loan will not do so
until several years after a TEACH Grant
recipient has left the institution.
Changes: None.
Recalculation of TEACH Grant Award
Amounts (§ 686.35)
Comment: One commenter suggested
that we change the title of this section
to ‘‘Recalculation of eligibility for
TEACH Grant award’’ to be consistent
with a similar section of the Pell Grant
Program regulations.
Discussion: The Secretary agrees that
the heading for this section should
reflect better the substance of the
section. Under this section, an
institution can recalculate the amount of
a TEACH Grant award in response to
changes in the student’s enrollment
status and changes in the student’s cost
of attendance.
Changes: The section heading of
§ 686.35 is changed to ‘‘Recalculation of
TEACH Grant award amounts.’’
Documenting the Service Obligation
(§ 686.40) and Periods of Suspension
(§ 686.41)
Comment: None.
Discussion: After negotiated
rulemaking was completed, the
Department learned that two new

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military family leave provisions were
added to the Family and Medical Leave
Act (FMLA) by the National Defense
Authorization Act Fiscal Year 2008
(Pub. L. 110–181) and that the
Department of Labor was in the process
of receiving public comment on an
NPRM for the FMLA implementing
regulations, which included a
description of the new military family
leave provisions, a discussion of the
issues, and a series of questions seeking
public comment on subjects and issues
to be addressed in final regulations. The
Secretary committed in the TEACH
Grant NPRM to consult with the
Department of Labor when developing
TEACH Grant final regulations so that
the provisions in §§ 686.40(e)(1) and
686.41(a)(1) would accurately reflect
qualifying reasons for leave under the
FMLA, including qualifying leave
reasons under the new military family
leave provisions. At the time of
publication of the final TEACH Grant
program regulations, the Department of
Labor was still reviewing the comments
received on the FMLA NPRM and had
not published revised final regulations.
Additionally, it was brought to our
attention that references to ‘‘conditions
covered under the FMLA’’ could imply
that the coverage, eligibility,
notification, certification and other
provisions of the FMLA might need to
be met in order for the condition to be
one which merited extension of the pay
back time. It is not our intention that
other qualifying criteria for employees
to take leave under the FMLA apply, or
even that leave be taken as a result of
such condition. The criteria will be met
if a TEACH Grant recipient is unable to
meet obligations of the grant due to a
condition that would be a qualifying
reason for leave under the FMLA.
Moreover, because the FMLA may
change, as it did in 2008, by
Congressional action in the future, we
believe that it is appropriate for the
TEACH Grant regulations to reference
the applicable provisions of the FMLA,
rather than to repeat those provisions in
the text of the TEACH Grant program
regulations. We believe that these
references will be a more accurate
source of information for TEACH Grant
recipients who are seeking a suspension
from the Secretary of the eight-year
period for completion of the service
obligation when complying with
§§ 686.40 and 686.41 of the TEACH
Grant regulations based on a condition
that would be considered a qualifying
reason for leave under the FMLA.
Changes: We have amended §§ 686.40
and 686.41 by removing the ‘‘list of
conditions covered’’ by the FMLA and
adding, in its place, a reference to

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qualifying reasons for leave under the
FMLA (29 U.S.C. 2612(a)(1) and (3)).
Periods of Suspension (§ 686.41)
Comment: Several commenters
supported the addition of suspension
periods to the TEACH Grant program as
a measure of protection for grant
recipients who, for reasons beyond their
control, need an extension of the eightyear period for completion of the
teaching service obligation.
Discussion: The Secretary appreciates
the commenters’ support.
Changes: None.
Comment: Several commenters
suggested that § 686.41(b) be amended
to allow TEACH Grant recipients to
request a suspension within a 12-month
period—rather than a 6-month period—
after the date that they either stop
teaching or complete or otherwise cease
enrollment in a TEACH Grant-eligible
program.
Another commenter noted that under
current § 686.41(b), a TEACH Grant
recipient must request a suspension
within six months of ceasing enrollment
in a TEACH Grant-eligible program and
that this period of time conflicts with
the trigger for conversion of a TEACH
Grant to a Federal Direct Unsubsidized
Loan in § 686.43(a)(2) because, under
that provision, conversion occurs within
120 days of ceasing enrollment in the
TEACH Grant-eligible program if the
grant recipient fails to notify the
Secretary that he or she is teaching or
still intends to teach full-time in
accordance with the ATS. The
commenters suggested that the Secretary
synchronize the timeframes for
requesting a suspension and the
timeframes under which a TEACH Grant
could convert to a Federal Direct
Unsubsidized Loan so that a grant is not
converted to a loan before the TEACH
Grant recipient has an opportunity to
request a suspension.
Discussion: We agree that the
deadline by which a TEACH Grant
recipient must request a suspension and
the time that a TEACH Grant may
convert to a Federal Direct
Unsubsidized Loan should not conflict.
However, we do not believe that
amending the regulations to require
TEACH Grant recipients to request a
suspension within 12 months of
completing or ceasing enrollment in a
TEACH Grant-eligible program or
stopping teaching service is appropriate
because such a change would not
resolve the conflicts between
§ 686.41(b), which gives a student 12
months to request a suspension, and
§ 686.43(a)(2), under which a TEACH
Grant could convert to a Federal Direct
Unsubsidized Loan 120 days after the

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35485

recipient completes a TEACH Granteligible program if the student does not
notify the Secretary.
To address the potential conflict, we
amended § 686.41(b) in two ways: (1) By
removing the requirement that a TEACH
Grant recipient make a request for a
suspension within six months of
completing or otherwise ceasing
enrollment or after he or she stops
teaching; and (2) by adding, in its place,
a requirement that a TEACH Grant
recipient request a suspension prior to
being subject to any of the conditions
under § 686.43(a)(1) through (a)(5) that
would cause the TEACH Grant to
convert to a Federal Direct
Unsubsidized Loan. With these changes,
a suspension request would have to be
made by the TEACH Grant recipient
within 120 days of ceasing enrollment
in a TEACH Grant-eligible program if
the grant recipient has failed to confirm
with the Secretary, within the 120-day
period, that he or she is or intends to be
employed full-time in accordance with
the terms and conditions of the
student’s ATS. If the recipient notifies
the Secretary in accordance with
§ 686.40(a), he or she still may request
a suspension, but must do so before any
of the conditions identified in
§ 686.43(a)(1), (a)(3), (a)(4), and (a)(5)
occur.
Changes: We amended § 686.41(b) to
require that a grant recipient must apply
for a suspension prior to being subject
to any conditions in § 686.43(a)(1)
through (a)(5) that would convert the
TEACH Grant to a Federal Direct
Unsubsidized Loan.
Comment: One commenter asked if it
would be appropriate to add the phrase
‘‘as a highly-qualified teacher’’ to the
end of § 686.41(a)(1)(i). The commenter
believed this additional language would
assist a TEACH Grant recipient by
broadening the circumstances under
which a suspension can be requested to
include enrollment in programs that
confer the status of ‘‘highly qualified.’’
Discussion: We do not believe it is
necessary to add the phrase ‘‘as a
highly-qualified teacher’’ to the end of
§ 686.41(a)(1)(i). If a student is seeking
a suspension to enroll in a program of
study that has been determined by a
State to satisfy the requirements for
certification or licensure to teach in the
State’s elementary or secondary schools,
the program’s course work must address
the State-determined standards for
highly-qualified teachers by definition.
Changes: None.
Obligation To Repay the Grant
(§ 686.43)
Comment: One commenter asked if
the counseling requirements in § 686.32

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require an institution to determine
when a TEACH Grant converts to a
Federal Direct Unsubsidized Loan and,
if so, whether an institution would be
required to participate in the Federal
Direct Loan Program in order to
participate in the TEACH Grant
program.
Discussion: The Secretary will
determine when a TEACH Grant
converts to a Federal Direct
Unsubsidized Loan in accordance with
§ 686.43(a). The counseling
requirements in § 686.32 in no way
require an institution that participates
in the TEACH Grant program to convert
a TEACH Grant to a loan. Moreover,
nothing in the TEACH Grant program
regulations requires institutions that
participate in the TEACH Grant program
to participate in the Direct Loan
Program. Under § 686.40(a), it is the
responsibility of the TEACH Grant
recipient to notify the Secretary within
120 days of completing or ceasing
enrollment in a TEACH Grant-eligible
program and annually thereafter about
his or her plans to satisfy the ATS, to
request a suspension, and to document
creditable teaching service. The
Secretary will track a TEACH Grant
recipient’s enrollment status and
progress in meeting the terms and
conditions of the recipient’s ATS and
will determine if and when a TEACH
Grant converts to a Federal Direct
Unsubsidized Loan based on this
information.
Changes: None.
Comment: Several commenters were
concerned that no appeal process is
available to a TEACH Grant recipient
whose TEACH Grant converts to a
Federal Direct Unsubsidized Loan. The
commenters believed that the
regulations should provide for an appeal
process so that a TEACH Grant
recipient’s individual circumstances
that caused the recipient to fail to satisfy
the terms and conditions of his or her
ATS could be evaluated or so that a
conversion of a TEACH Grant to a loan
that was done in error could be
corrected.
Discussion: We do not believe that an
appeals process is necessary because a
number of protections are already built
into the TEACH Grant program. First,
under the HEA, recipients have eight
years to complete a four-year service
obligation—this builds in four extra
years for recipients with ‘‘mitigating
circumstances’’ to satisfy their service
obligation. Moreover, suspensions of the
service obligation requirements are
available under a number of defined
situations a recipient could face. For
example, § 686.41(a) provides up to
three years of eligibility for a suspension

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of the eight-year period in which a
TEACH Grant recipient has to satisfy the
conditions of his or her ATS based on
enrollment in a TEACH Grant-eligible
program or a program of study to obtain
a State license to teach, or a condition
that is a qualifying reason for leave
under the FMLA. TEACH Grant
recipients also may request a
suspension for an unlimited period of
time to meet certain military
obligations. Finally, if a TEACH Grant is
converted to a Federal Direct
Unsubsidized Loan in error, the grant
recipient may contact the Department of
Education’s Student Loan Ombudsman
or other Department staff to resolve the
matter.
Changes: None.
Comment: Several commenters
recommended that the regulations
permit a TEACH Grant recipient to
cancel the TEACH Grant within a
reasonable timeframe. The commenters
noted that otherwise, a TEACH Grant
recipient would be required to request
conversion of the TEACH Grant to a
Federal Direct Unsubsidized Loan under
§ 686.43(a)(1) if the recipient decided
that he or she does not want the TEACH
Grant.
Discussion: We agree that a TEACH
Grant recipient should be able to cancel
all or part of a TEACH Grant within a
reasonable time without having to
request that the TEACH Grant be
converted to a Federal Direct
Unsubsidized Loan. We have added a
new paragraph (e) to § 686.31 and
amended 34 CFR 668.165 to require that
an institution provide the same notices
and cancellation opportunities to
TEACH Grant recipients that it provides
to borrowers in the Title IV, HEA loan
programs.
Changes: We have added a new
paragraph (e) to § 686.31 of the TEACH
Grant program regulations and amended
34 CFR 668.165(a)(2) to provide that,
before disbursing a TEACH Grant for
any award year, an institution must
notify the student of the amount of
TEACH Grant funds that the student is
eligible to receive, how and when those
funds will be disbursed, and the
student’s right to cancel all or a portion
of the TEACH Grant. Under
§ 686.31(e)(1)(ii) and 34 CFR
668.165(a)(4), an institution must also
return the TEACH Grant proceeds,
cancel the TEACH Grant, or do both, if
the institution receives a TEACH Grant
cancellation request from the student no
later than the first day of a payment
period or 14 days after the date it
notifies the student of his or her right to
cancel all or a portion of a TEACH
Grant. Under § 686.31(e)(2)(i) and 34
CFR 668.165(a)(4)(iii), if a student

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requests cancellation of a TEACH Grant
after the first day of a payment period
or 14 days after the date the institution
notifies the student of his or her right to
cancel, but within 120 days of the
TEACH Grant disbursement date, the
institution may return the TEACH Grant
proceeds or cancel the TEACH Grant, or
both. Finally, under § 686.31(e)(2)(ii), if
the institution does not return the
TEACH Grant proceeds, or cancel the
TEACH Grant, the institution must
notify the student that he or she may
contact the Secretary to request that the
TEACH Grant be converted to a Federal
Direct Unsubsidized Loan.
Comment: One commenter stated that
interest should begin accruing on the
date that a TEACH Grant is converted to
a Federal Direct Unsubsidized Loan, not
on the date that the TEACH Grant was
disbursed.
Discussion: Section 420N(c) of the
HEA provides that interest accrues from
the date that a TEACH Grant was
disbursed. The Secretary does not have
the authority to change this statutory
requirement.
Changes: None.
Comment: One commenter asked
whether the Department would assess
origination or insurance fees on a
Federal Direct Unsubsidized Loan that
was originally a TEACH Grant.
Discussion: The Secretary has no
plans to assess origination or insurance
fees on a Federal Direct Unsubsidized
Loan that was originally a TEACH
Grant.
Changes: None.
Comment: One commenter supported
§ 686.43(b), which exempts TEACH
Grants that convert to Federal Direct
Unsubsidized Loans from annual and
aggregate loan limits, as an appropriate
protection for TEACH Grant recipients
who, for reasons beyond their control,
may be unable to satisfy their ATS but
still may need Federal student aid.
Another commenter stated that the
regulations exempting TEACH Grants
that convert to Federal Direct
Unsubsidized Loans from annual loan
limits is unwise because students who
have no plans to teach may accept
TEACH Grants as a means of borrowing
more than current annual loan limits
allow.
Discussion: There are many reasons
why a TEACH Grant recipient may be
unable to fulfill his or her ATS, thereby
triggering conversion of TEACH Grants
to Federal Direct Unsubsidized Loans.
In some cases, TEACH Grant recipients
whose grants convert to Federal Direct
Unsubsidized Loans might immediately
exceed aggregate loan limits and be
declared ineligible for further Title IV,
HEA aid until the loans are paid down.

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The Secretary believes this approach is
overly punitive.
As discussed earlier in this preamble,
although an institution may limit the
programs it designates as TEACH Granteligible, an institution can never know
with certainty whether a student truly
intends to fulfill his or her service
obligation or whether the student
applies for and receives a TEACH Grant
only to circumvent loan limits in the
Direct Loan Program. We also believe
that the extensive counseling and
materials provided to TEACH Grant
recipients will ensure that only those
students who intend to teach receive
TEACH Grants.
Changes: None.
Comment: One commenter
recommended that we amend the
regulations in § 686.43(c) to provide a
grace period for a grant recipient whose
TEACH Grant has been converted to a
Federal Direct Unsubsidized Loan. The
commenter stated that the purpose of a
grace period is to allow adequate time
for a graduate to find employment
before beginning repayment. The
commenter believed that it was unfair to
expect a TEACH Grant recipient to
begin repayment immediately.
Discussion: The Secretary agrees with
the commenter. We have reviewed our
initial budget assumptions and have
determined that there is no cost
associated with making a change to the
final regulations and providing a grace
period in § 686.43(c) to a grant recipient
whose TEACH Grant has been converted
to a Federal Direct Unsubsidized Loan.
The provision of a grace period to a
TEACH Grant recipient whose grant has
converted to a loan also mirrors the
terms of the Direct Loan Program with
regard to entering repayment.
Changes: We have amended
§ 686.43(c) to provide a grace period for
a grant recipient whose TEACH Grant
has been converted to a Federal Direct
Unsubsidized Loan.
Comment: One commenter
recommended that § 686.43(c) specify
that a grant recipient who is in school
when his or her TEACH Grant converts
to a Federal Direct Unsubsidized Loan
is eligible for an in-school deferment so
that such students do not have to begin
making payments immediately upon
conversion of the TEACH Grant.
Discussion: A grant recipient whose
TEACH Grant has been converted to a
Federal Direct Unsubsidized Loan is
eligible for most of the benefits of the
Direct Loan Program. These benefits
include an in-school deferment as long
as the borrower is eligible under 34 CFR
685.204(b)(1). We agree that the
regulations should highlight this benefit
so that TEACH Grant recipients who are

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in school at the time of conversion are
aware of it.
Changes: We have amended
§ 686.43(c)(2) by adding the words ‘‘,
including an in-school deferment’’ at
the end of the paragraph.
Executive Order 12866
Regulatory Impact Analysis
Under Executive Order 12866, the
Secretary must determine whether this
regulatory action is ‘‘significant’’ and
therefore subject to the requirements of
the Executive Order and subject to
review by the Office of Management and
Budget (OMB). Section 3(f) of Executive
Order 12866 defines a ‘‘significant
regulatory action’’ as an action likely to
result in a rule that may (1) have an
annual effect on the economy of $100
million or more, or adversely affect a
sector of the economy, productivity,
competition, jobs, the environment,
public health or safety, or State, local or
tribal governments or communities in a
material way (also referred to as an
‘‘economically significant’’ rule); (2)
create serious inconsistency or
otherwise interfere with an action taken
or planned by another agency; (3)
materially alter the budgetary impacts of
entitlement grants, user fees, or loan
programs or the rights and obligations of
recipients thereof; or (4) raise novel
legal or policy issues arising out of legal
mandates, the President’s priorities, or
the principles set forth in the Executive
order.
Pursuant to the terms of the Executive
Order, it has been determined that this
regulatory action will have an annual
effect on the economy of more than
$100 million. Therefore, this action is
‘‘economically significant’’ and subject
to OMB review under section 3(f)(1) of
Executive Order 12866. Accordingly,
the Secretary has assessed potential
costs and benefits of this regulatory
action and has determined the benefits
justify the costs.
Need for Federal Regulatory Action
As discussed in the NPRM, these
regulations are needed to implement
provisions of the HEA, as amended by
the CCRAA, that established the TEACH
Grant program. The Secretary has
exercised limited discretion in
implementing the CCRAA provisions in
the following areas:
• Definition of elementary and
secondary academic year: The CCRAA
provides that a grant recipient must
serve as a full-time teacher for a total of
not less than four academic years within
eight years after completing the program
of study for which he or she received a
TEACH Grant.

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• TEACH Grant-eligible institution:
The CCRAA provides that an eligible
institution for purposes of the TEACH
Grant program must be an institution of
higher education as defined in section
102 of the HEA that is financially
responsible and that provides: Highquality teacher preparation and
professional development services,
including extensive clinical experience
as part of pre-service preparation;
pedagogical coursework, or assistance in
the provision of such coursework; and
supervision and support services to
teachers, or assistance in the provision
of such services, or that provides a postbaccalaureate program of instruction.
• Calculation of Grade-Point Average
for Transfer Students: The CCRAA
requires students to have a grade-point
average of 3.25 on a 4.0 scale to be
eligible to receive a TEACH Grant; and
• Counseling: The CCRAA requires
schools to provide counseling at a
number of points to provide
participating students with information
on the program and, in particular, to
underscore the student’s responsibilities
in the event the program’s service
requirements are not fulfilled.
• Discharge of Service Agreement:
The CCRAA does not address the
discharge of a service obligation if a
TEACH Grant recipient dies or becomes
totally and permanently disabled.
The following section addresses the
alternatives that the Secretary
considered in implementing these
discretionary portions of the CCRAA
provisions.
Regulatory Alternatives Considered
A broad range of alternatives to the
regulations was considered as part of
the negotiated rulemaking process.
These alternatives were reviewed in
detail in the preamble to the NPRM
under both the Regulatory Impact
Analysis and the Reasons sections
accompanying the discussion of each
proposed regulatory provision. To the
extent they were addressed in response
to comments received on the NPRM,
alternatives are also considered
elsewhere in the preamble to these final
regulations under the Discussion
sections related to each provision. No
comments were received related to the
Regulatory Impact Analysis discussion
of these alternatives.
Net Budget Impacts
As noted in the NPRM, the TEACH
Grant program is estimated to have a net
budget impact of $7 million in 2008 and
$74 million over FY 2008–2012. For
budget, financial management, and cost
estimation purposes, TEACH Grants
will be operated as a loan program with

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100 percent forgiveness of outstanding
principal and interest upon completion
of a student’s service obligation.
Consistent with the requirements of the
Credit Reform Act of 1990, budget cost
estimates for this program reflect the
estimated net present value of all future
non-administrative Federal costs
associated with awards made in a given
fiscal year. Details on how these
estimates were developed are provided
in the Regulatory Impact Analysis
section of the NPRM.
The administrative burden associated
with §§ 686.4, 686.11, 686.32, and
686.34 of the TEACH Grant final
regulation package has been estimated
in accordance with the Paperwork
Reduction Act of 1995 and Bureau of
Labor Statistics wage information. The
total increase in PRA burden associated
with the regulations is estimated to be
$2.6 million. This amount is comprised
of $1.6 million in determining eligibility
to receive a grant, $997,245 in
complying with counseling
requirements, $1,589 in determining
institutional eligibility, and $16,775 in
covering liability for and recovery of
overpayments.

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Assumptions, Limitations, and Data
Sources
Because these regulations largely
restate statutory requirements that
would be self-implementing in the
absence of regulatory action, impact
estimates provided in the preceding
section reflect a pre-statutory baseline in
which the CCRAA and other statutory
changes implemented in these
regulations do not exist. Costs have been
quantified for five years.
In developing these estimates, a wide
range of data sources were used,
including the National Student Loan
Data System, operational and financial
data from Department of Education
systems, and data from a range of
surveys conducted by the National
Center for Education Statistics, such as
the Baccalaureate and Beyond, Schools
and Staffing, and the 1996 Beginning
Postsecondary Student surveys. No
comments or additional data were
received related to the estimates or
discussions included in the NPRM.
Elsewhere in this SUPPLEMENTARY
INFORMATION section we identify and
explain burdens specifically associated
with information collection
requirements. See the heading
Paperwork Reduction Act of 1995.
Accounting Statement
As required by OMB Circular A–4
(available at http://
www.Whitehouse.gov/omb/Circulars/
a004/a-4.pdf), in Table 2 below, we

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have prepared an accounting statement
showing the classification of the
expenditures associated with the
provisions of these regulations. This
table provides our best estimate of the
changes in Federal student aid
payments as a result of these
regulations. Expenditures are classified
as transfers to postsecondary students.

TABLE 2.—ACCOUNTING STATEMENT:
CLASSIFICATION OF ESTIMATED EXPENDITURES
[In millions]
Category
Annualized Monetized
Transfers.
From Whom To
Whom?

Transfers
$17.
Federal Government
To Postsecondary
Students.

Waiver of Delayed Effective Date and
Congressional Review Act
The Administrative Procedure Act
requires that a substantive rule be
published at least 30 days before its
effective date, except as otherwise
provided for good cause (5 U.S.C.
553(d)(3)). The Secretary has
determined that a delayed effective date
for these final regulations is
unnecessary and contrary to the public
interest, and that good cause exists to
waive the requirement for a delayed
effective date. Pursuant to section 420O
of the HEA, Congress directed the
Secretary to make TEACH Grants
available as of July 1, 2008. To fulfill the
intent of Congress that TEACH Grants
be available to eligible students
beginning on July 1, 2008, the Secretary
makes these regulations effective as of
the date of publication to enable TEACH
Grant-eligible institutions to prepare
and forward student financial aid
packages as early as possible following
the availability of funds for this
program. We note that delaying the
effective date of the regulations also
would prevent a significant number of
otherwise eligible students enrolled
during the 2008 summer term from
being able to receive a TEACH Grant.
These regulations have been
determined to be major for purposes of
the Congressional Review Act (CRA) (5
U.S.C. 801, et seq.). However, for the
reasons outlined in the preceding
paragraph, the Department has
determined that, pursuant to section
808(2) of the CRA, the delay in the
effective date generally required for
congressional review is contrary to the
public interest and waived for good
cause.

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Regulatory Flexibility Act Certification
The Secretary certifies that these final
regulations will not have a significant
economic impact on a substantial
number of small entities. These final
regulations will affect institutions of
higher education and individual
students and loan borrowers. The U.S.
Small Business Administration Size
Standards define institutions as ‘‘small
entities’’ if they are for-profit or
nonprofit institutions with total annual
revenue below $5,000,000 or if they are
institutions controlled by governmental
entities with populations below 50,000.
Individuals are also not defined as
‘‘small entities’’ under the Regulatory
Flexibility Act.
As noted in the NPRM, a significant
percentage of the schools participating
in the Federal student loan programs
meet the definition of ‘‘small entities.’’
In general, the Department believes
benefits under these final regulations
outweigh the relatively small additional
burdens, particularly given that
institutions finding the program’s
requirements onerous have the option of
not participating. This belief is strongly
supported by the fact that the negotiated
rulemaking committee reached
consensus on the proposed regulations.
In the NPRM, the Secretary invited
comments from small institutions as to
whether they believe the proposed
regulations would have a significant
economic impact on them and, if so,
requested evidence to support that
belief. No comments or data were
received.
Paperwork Reduction Act of 1995
Sections 668.165, 686.4, 686.10,
686.11, 686.12, 686.20, 686.31, 686.32,
686.34, 686.36, 686.37, 686.38, 686.40,
686.41, 686.42 and 686.43 contain
information collection requirements.
Under the Paperwork Reduction Act of
1995 (44 U.S.C. 3507(d)), the
Department of Education has submitted
a copy of these sections to OMB for its
review.
Section 668.165—Notices and
Authorizations
The final regulations modify the
Student Assistance General Provisions
by including the Teacher Education
Assistance for College and Higher
Education (TEACH) Grant program in
subpart K of the Student Assistance
General Provisions regulations in 34
CFR part 668 (Cash management).
Before an institution disburses Title IV,
HEA program funds for any award year,
the institution must notify a student of
the amounts of funds that the student
can expect to receive and how and

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when those funds will be disbursed.
The institution is required to notify, in
writing, the recipient of a TEACH Grant
of the student’s right to cancel or reduce
the amount of the TEACH Grant
disbursement, as well as the procedures
by which the student must notify the
institution. We estimate that the
requirements in § 668.165 will increase
burden for institutions and individuals
by 14,090 hours annually in OMB
Control Number 1845–0038.
Section 686.4—Institutional
Participation
The final regulations require an
institution that ceases to participate in
the TEACH Grant program or becomes
ineligible to participate during an award
year, to report to the Department within
45 days after the effective date of the
loss of eligibility. The contents of the
report must include the name of each
TEACH Grant-eligible student; the
amount of the TEACH Grant funds paid
to each student for that award year; and
the amount of TEACH Grant funds due
each eligible student through the end of
the payment period. Also, the
institution must provide an accounting
of all TEACH Grant expenditures for
that award year to the date of
termination. We estimate that the
requirements in § 686.4 will increase
burden for institutions by 81 hours in
OMB Control Number 1845–XXXX.

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Section 686.10—Application
Under the final regulations, a
potential TEACH grant recipient must
complete and submit an approved and
signed application form, as designated
by the Secretary prior to the published
deadline. Currently, the FAFSA is the
designated application form. All
undergraduate and most graduate
student applicants for Title IV, HEA
program assistance must complete and
submit the FAFSA. Because the TEACH
Grant Program is not a need-based
program, some applicants will be
required to complete a FAFSA that
otherwise may not have been required
to complete a FAFSA, thereby
generating additional burden. The
estimated burden associated with these
application requirements is contained in
OMB Control Number 1845–0001. We
estimate that the burden will increase
for individuals by 1,000 hours.
Section 686.11—Eligibility To Receive a
Grant
The final regulations establish that in
addition to meeting the student
eligibility requirements, in order to
receive a TEACH Grant the applicant
must submit the designated application,
sign a TEACH Grant ATS, and enroll in

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a TEACH Grant-eligible institution.
Grant recipients must maintain a GPA of
3.25 on a 4.0 scale during each payment
period, score above the 75th percentile
on at least one of a battery of nationallynormed standardized tests, or qualify as
a current or retired teacher obtaining a
master’s degree in a TEACH Granteligible program. There are several
categories of grant recipients who must
maintain the cumulative GPA of 3.25
each payment period.
Those categories are:
I. During the initial payment period:
The final cumulative high school GPA
for a first term undergraduate
recipient—
The TEACH Grant-eligible institution
must document the student’s secondary
school GPA from an LEA, an SEA or
other State agency; a public or private
high school; or in the case of a home
schooled student, obtain documentation
of the secondary school GPA from the
parent or guardian.
The undergraduate cumulative GPA
for either the post-baccalaureate or
graduate student recipient—
The TEACH Grant-eligible institution
must document the student’s
undergraduate school cumulative GPA.
The transfer student cumulative GPA
as determined by the current TEACH
Grant-eligible institution—
The TEACH Grant-eligible institution
must document the student’s
cumulative GPA based upon the method
established by the institution to accept
coursework completed from any prior
postsecondary institution that it accepts.
II. Subsequent payment periods:
The cumulative GPA based on courses
taken at the TEACH Grant-eligible
institution through the most recently
completed payment period, or
III. Alternatives to the cumulative
GPA:
Scoring above the 75th percentile of at
least one of the battery of tests from a
nationally-normed standardized test, or
The TEACH grant recipient is
currently a teacher or retiree who is
applying for a TEACH Grant to obtain a
master’s degree in a TEACH Granteligible program. We estimate that the
paperwork burden associated with
§ 686.11 will increase for individuals
and institutions by 82,675 hours in
OMB Control Number 1845–XXXX.
Section 686.12—Agreement To Serve
Under the final regulations, a student
must sign an ATS before receiving a
TEACH Grant. The ATS provides that a
student must fulfill a service obligation
for each program for which the student
received a TEACH Grant. The ATS
explains the terms of the service
obligation and provides that if a TEACH

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35489

Grant recipient does not fulfill the
service obligation or otherwise does not
meet the requirements of 34 CFR part
686, any TEACH Grant the student
received will convert to a Federal Direct
Unsubsidized Loan that the student
must repay in full to the Secretary, with
interest.
The burden associated with the ATS
will be reported under OMB Control
Number 1845–0083. OMB granted
emergency approval of the ATS on May
15, 2008. The ATS will be submitted for
public comment under the regular
clearance process.
Section 686.20—Submission Process
and Deadline for a SAR or ISIR
The final regulations require that
participating institutions who disburse
TEACH Grant funds to students must
electronically transmit data as required
by the Secretary. The burden associated
with the collection and transmission of
the required data is assessed and
attributed in 34 CFR 686.37. Therefore,
there is no burden associated with this
section of the final regulations.
Section 686.31—Determination of
Eligibility for Payment and
Cancellation of a TEACH Grant
Section 686.31 of the final regulations
added notification requirements for an
institution awarding TEACH Grants that
are consistent with the changes made in
34 CFR 668.165—(Notices and
authorizations). The estimated burden
associated with these notification
requirements is contained in OMB
Control Number 1845–0038, as reported
under the Section 668.165—Notices and
authorizations heading. As a result,
there is no additional burden associated
with § 686.31.
Section 686.32—Counseling
requirements
The final regulations require an
institution to ensure that initial,
subsequent, and exit counseling are
provided to each TEACH Grant
recipient. The initial counseling is
required prior to making the first
disbursement of the grant. Initial
counseling must include, but is not
limited to, explaining the terms and
conditions of the TEACH Grant ATS;
providing information on how to
identify low-income schools and
documented high need fields; informing
grant recipients of the possibility of a
suspension of the eight-year period for
completion of the service obligation;
and the conditions under which a
suspension may be granted. Subsequent
counseling, which must occur prior to
the first disbursement of a TEACH Grant
in a subsequent award year, must

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include, but is not limited to reviewing
the terms and conditions of the ATS;
and emphasizing that if the student fails
or refuses to complete the service
obligation, the TEACH Grant will
convert into a Federal Direct
Unsubsidized Loan. Under the final
regulations, institutions must ensure
that exit counseling is provided to each
TEACH Grant recipient before the
recipient ceases to attend the
institution. Written exit counseling
materials may be provided within 30
days after completing a study abroad
program or after a student withdraws
without notifying the institution. We
estimate that the paperwork burden
associated with § 686.32 will increase
for individuals and institutions by
50,828 hours in OMB Control Number
1845–XXXX.
Section 686.34—Liability for and
Recovery of TEACH Grant
Overpayments
The final regulations require the
institution to promptly provide written
notification to a student requesting
repayment of any overpayment that the
institution does not have responsibility
to repay. These final regulations also
require that the institution refer the
student to the Department if the student
does not take positive action to
promptly resolve the TEACH Grant
overpayment. We estimate that § 686.34
will increase burden for individuals and
institutions by 855 hours in OMB
Control Number 1845–XXXX.

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Section 686.36—Fiscal Control and
Accounting Procedures
The final regulations provide that
participating institutions must account
for the receipt and expenditure of Title
IV, HEA program funds in accordance
with generally accepted accounting
principles. Further, participating
institutions must disburse TEACH Grant
funds consistent with the cash
management regulations in 34 CFR
668.164. Participating institutions must
comply with these requirements for the
other Title IV, HEA programs and,
therefore, there is no additional burden
placed upon institutions participating in
the TEACH Grant program.
Section 686.37—Institutional Reporting
Requirements
Under the final regulations, a
participating institution must provide
the Secretary information about each
TEACH Grant recipient that includes,
but is not limited to: The student’s
eligibility for a TEACH Grant, the
amounts of the TEACH Grant disbursed,

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the anticipated and actual disbursement
dates, and the disbursement amounts of
the TEACH Grants provided. The initial
disbursement information must be
submitted to the Department no later
than 30 days following the initial
disbursement of TEACH Grant funds.
Subsequent disbursements,
cancellations, and adjustments must be
submitted to the Department within 30
days of the transaction. Participating
institutions must comply with these
requirements for other Title IV, HEA
programs and, therefore, there is no
additional burden placed upon
institutions participating in the TEACH
Grant program.
Section 686.38—Maintenance and
Retention of Records
The final regulations require
participating institutions to maintain
the fiscal records for the TEACH Grant
program for three years after the end of
the award year for which the TEACH
Grant was awarded. Participating
institutions must comply with these
requirements for the other Title IV, HEA
programs and, therefore, there is no
additional burden placed upon
institutions participating in the TEACH
Grant program.
Section 686.40—Documenting the
Service Obligation
Except as provided in §§ 686.40 and
686.42, the final regulations require a
student to confirm to the Secretary in
writing, within 120 days of completing
or otherwise ceasing enrollment in a
program for which the student received
a TEACH Grant, that he or she is
employed as a full-time teacher in
accordance with the TEACH Grant ATS,
or is not yet employed, but intends to
meet the terms and conditions of the
ATS.
The burden associated with this
notification requirement will be covered
under a new collection. A separate 60day information collection notice will
be published in the Federal Register to
solicit comment on a notification form
once it is developed.
Section 686.41—Periods of Suspension
The final regulations provide that a
TEACH Grant recipient may request a
suspension of the 8-year period for
completion of the TEACH Grant service
obligation based on one of the
conditions described in § 686.41. The
grant recipient must apply for a
suspension on a form approved by the
Secretary.
The burden associated with this
notification requirement will be covered

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under a new collection. A separate 60day information collection notice will
be published in the Federal Register to
solicit comment on a suspension request
form once it is developed.
Section 686.42—Discharge of
Agreement To Serve
Under the final regulations, a TEACH
Grant recipient’s service obligation will
be discharged if the recipient dies, or if
the recipient becomes totally and
permanently disabled and meets the
eligibility requirements for a total and
permanent disability discharge in 34
CFR 685.213.
The burden associated with the
discharge of a TEACH Grant service
obligation based on the grant recipient’s
death is covered under OMB Control
Number 1845–0021 as the TEACH Grant
will be recognized as an Federal Direct
Unsubsidized Loan for the purposes of
the loan discharge for death, consistent
with § 685.212. We estimate that the
burden will increase for individuals and
loan holders by 23 hours in OMB
Control Number 1845–0021.
The burden associated with the
discharge of a TEACH Grant service
obligation based on the grant recipient’s
total and permanent disability is
covered under OMB Control Number
1845–0065.
Section 686.43—Obligation To Repay
the Grant
The final regulations specify the
conditions under which a TEACH Grant
will be converted to a Federal Direct
Unsubsidized Loan that the grant
recipient must repay. One of these
conditions is when a TEACH Grant
recipient who has completed a program
for which he or she received a TEACH
Grant does not notify the Secretary at
least annually of his or her intent to
satisfy the TEACH Grant service
obligation.
The burden associated with this
notification requirement will be covered
under the same new collection
associated with the notification
requirement in § 686.40.
Consistent with the discussion in this
Paperwork Reduction Act of 1995
section, the following chart describes
the sections of the final regulations
involving information collections, the
information being collected, and the
collections the Department will submit
to OMB for approval and public
comment under the Paperwork
Reduction Act of 1995.

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Regulatory
section

Information collection

Collection

668.165 ..............

Before an institution disburses Title IV, HEA program funds
for any award year, the institution must notify a student of
the amounts of funds that the student can expect to receive and how and when those funds will be disbursed.
The institution is required to notify in writing, the recipient
of a TEACH Grant of the student’s right to cancel or reduce the amount of the TEACH Grant disbursement, as
well as the procedures by which the student must notify
the institution.
Institutions that cease participation in the TEACH Grant program or otherwise lose eligibility are required to report program data to the Department within 45 days of the change
in eligibility.
A TEACH Grant recipient must (a) score above the 75th percentile on a standardized nationally-normed test, (b) maintain a 3.25 cumulative GPA, or (c) currently be a teacher
or retiree obtaining a master’s degree in an eligible
TEACH Grant program.
Before receiving a TEACH Grant, a student must sign an
ATS. The ATS provides that student must fulfill a service
obligation for each program for which the student received
a TEACH Grant. The ATS explains the terms of the service obligation and provides that if a TEACH Grant recipient
does not fulfill the service obligation or otherwise does not
meet the requirements of 34 CFR part 686, any TEACH
Grant the student received will be converted to a Federal
Direct Unsubsidized Loan that the student must repay in
full to the Secretary, with interest.
An institution participating in the TEACH Grant program
must, before disbursing Title IV, HEA program funds, notify
the recipient in accordance with 34 CFR 668.165.
A participating institution must ensure that initial, subsequent,
and exit counseling are provided for all TEACH Grant recipients.
A participating institution must provide written notice to any
TEACH Grant recipient when he or she owes a TEACH
Grant overpayment. Moreover, if the recipient does not
take positive action to resolve the overpayment within the
deadline, the institution must report the overpayment to the
Department.
Except as provided in §§ 686.40 and 686.42, within 120-days
of completing or otherwise ceasing enrollment in a program for which the student received a TEACH Grant, the
student must confirm to the Secretary in writing that he or
she is employed as a full-time teacher in accordance with
the TEACH Grant ATS, or is not yet employed, but intends
to meet the terms and conditions of the ATS.
A TEACH Grant recipient may request a suspension of the
8-year period for completion of the TEACH Grant service
obligation based on one of the conditions described in
§ 686.41. The grant recipient must apply for a suspension
on a form approved by the Secretary.
A TEACH Grant recipient’s service obligation will be discharged if the recipient dies, or if the recipient becomes totally and permanently disabled and meets the eligibility requirements for a total and permanent disability discharge
in 34 CFR 685.213.
One of the conditions under which a TEACH Grant will be
converted to a Federal Direct Unsubsidized Loan is if a
grant recipient who has completed a program for which he
or she received a TEACH Grant does not notify the Secretary at least annually of his or her intent to satisfy the
TEACH Grant service obligation.

OMB 1845–0038. This will be a revision of an existing collection which was submitted to OMB with these final regulations.

686.4 ..................

686.11 ................

686.12 ................

686.31 ................
686.32 ................
686.34 ................

686.40 ................

686.41 ................

686.42 ................

686.43 ................

Assessment of Educational Impact
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35491

In the NPRM, and in accordance with
section 411 of the General Education
Provisions Act, 20 U.S.C. 1221e–4, we
requested comments on whether the
proposed regulations would require

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OMB 1845–XXXX. This will be a new collection.

OMB 1845–XXXX. This will be a new collection.

OMB 1845–0083. OMB granted emergency approval of the
ATS on May 15, 2008. The ATS will be submitted for public comment under the regular clearance process in the
near future.

The estimated burden associated with this section of the final
regulations is recognized in OMB 1845–0038 Cash Management.
OMB 1845–XXXX. This will be a new collection.
OMB 1845–XXXX. This will be a new collection.

OMB 1845–XXXX. This will be a new collection. A separate
60-day information collection notice will be published in the
Federal Register to solicit comment on this form. The
form will be put into the paperwork clearance process by
October 2008.
OMB 1845–XXXX. This will be a new collection. A separate
60-day information collection notice will be published in the
Federal Register to solicit comment on this form. The
form will be put into the paperwork clearance process by
October 2008.
Discharge of a TEACH Grant service obligation based on the
grant recipient’s death is covered under OMB 1845–0021.
Discharge of a TEACH Grant service obligation based on
the grant recipient’s total and permanent disability is covered under OMB 1845–0065.
This will be covered by the same new collection as described
for § 686.40.

transmission of information that any
other agency or authority of the United
States gathers or makes available.
Based on the responses to the NPRM
and on our review, we have determined
that these final regulations do not

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require transmission of information that
any other agency or authority of the
United States gathers or makes
available.

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Electronic Access to This Document
You may view this document, as well
as all other Department of Education
documents published in the Federal
Register, in text or Adobe Portable
Document Format (PDF) on the Internet
at the following site: http://www.ed.gov/
news/fedregister.
To use PDF you must have Adobe
Acrobat Reader, which is available free
at this site. If you have questions about
using PDF, call the U.S. Government
Printing Office (GPO), toll free, at
1–888–293–6498; or in the Washington,
DC, area at (202) 512–1530.
Note: The official version of this document
is the document published in the Federal
Register. Free Internet access to the official
edition of the Federal Register and the Code
of Federal Regulations is available on GPO
Access at: http://www.gopaccess.gov/nara/
index.html.
(Catalog of Federal Domestic Assistance
Numbers: 84.007 Federal Supplemental
Educational Opportunity Grant Program;
84.032 Federal Family Education Loan
Program; 84.033 Federal Work Study; 84.038
Federal Perkins Loan Program; 84.063
Federal Pell Grant Program; 84.069
Leveraging Education Assistance
Partnerships; 84.268 William D. Ford Federal
Direct Loan Program; 84.379 TEACH Grant
program)

List of Subjects
34 CFR Part 668
Administrative practice and
procedure, Colleges and universities,
Consumer protection, Education, Grant
programs—education, Loan programs—
education, Reporting and recordkeeping
requirements, Student aid, Vocational
education.
34 CFR Parts 673, 675, and 676
Administrative practice and
procedure, Colleges and universities,
Consumer protection, Education,
Employment, Grant programs—
education, Loan programs—education,
Reporting and recordkeeping
requirements, Student aid, Vocational
education.

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34 CFR Parts 674, 682, and 685
Administrative practice and
procedure, Colleges and universities,
Education, Loan programs—education,
Reporting and recordkeeping
requirements, Student aid, Vocational
education.
34 CFR Part 686
Administrative practice and
procedure, Colleges and universities,
Education, Elementary and secondary
education, Grant programs—education,
Reporting and recordkeeping
requirements, Student aid.

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34 CFR Part 690
Grant programs—education,
Reporting and recordkeeping
requirements, Student aid.
Dated: June 11, 2008.
Margaret Spellings,
Secretary of Education.

For the reasons discussed in the
preamble, the Secretary amends 34 CFR
chapter VI as follows:

■

PART 668—STUDENT ASSISTANCE
GENERAL PROVISIONS
1. The authority citation for part 668
is revised to read as follows:

■

Authority: 20 U.S.C. 1001, 1002, 1003,
1070g, 1085, 1088, 1091, 1092, 1094, 1099c,
and 1099c–1, unless otherwise noted.

2. Section 668.1 is amended by:
A. In paragraph (c)(10), removing the
word ‘‘and’’ that appears after the
punctuation ‘‘;’’.
■ B. In paragraph (c)(11), removing the
punctuation ‘‘.’’ at the end of the
paragraph and adding, in its place, the
words ‘‘; and’’.
■ C. Adding a new paragraph (c)(12) to
read as follows:
■
■

§ 668.1

*
*
*
*
(c) * * *
(12) The Teacher Education
Assistance for College and Higher
Education (TEACH) Grant program.
*
*
*
*
*
■ 3. Section 668.2 is amended by:
■ A. In paragraph (b), adding, in
alphabetical order, the definitions of
‘‘Teacher Education Assistance for
College and Higher Education (TEACH)
Grant program’’ and ‘‘TEACH Grant’’.
■ B. In paragraph (b), amending
paragraph (2) of the definition of
‘‘Undergraduate student’’ by:
■ i. Removing the word ‘‘and’’ following
‘‘(ACG) Program’’.
■ ii. Adding ‘‘, and TEACH Grant
program’’ after ‘‘(SMART) Grant
Program’’.
■ iii. Adding ‘‘and 686.3(a)’’ after
‘‘690.6(c)(5)’’.
■ C. In paragraph (b), revising the
authority citation for the definition of
undergraduate student.
The additions and revision read as
follows:
General definitions.

*

*
*
*
*
(b) * * *
Teacher Education Assistance for
College and Higher Education (TEACH)
Grant Program: A grant program
authorized by title IV of the HEA under
which grants are awarded by an

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(Authority: 20 U.S.C. 1070g)

TEACH Grant: A grant authorized
under title IV–A–9 of the HEA and
awarded to students in exchange for
prospective teaching service.
(Authority: 20 U.S.C. 1070g)

*

*
*
*
*
Undergraduate student:
*
*
*
*
*
(Authority: 20 U.S.C. 1070g)

*

*

§ 668.4

*

*

*

[Amended]

4. Section 668.4(b)(1) is amended by
removing the word ‘‘and’’ that appears
after ‘‘FSEOG,’’ and adding ‘‘, and
TEACH Grant’’ after ‘‘Perkins Loan’’.
■ 5. Section 668.8 is amended by:
■ A. In the heading of paragraph (h),
adding ‘‘TEACH Grant,’’ after ‘‘National
SMART Grant,’’.
■ B. In paragraph (h)(1), removing the
word ‘‘and’’ that appears after the
punctuation ‘‘;’’.
■ C. In paragraph (h)(2), removing the
punctuation ‘‘.’’ at the end of the
paragraph and adding, in its place, the
words ‘‘; and’’.
■ D. Adding a new paragraph (h)(3).
■ E. Revising the authority citation.
The addition and revision read as
follows:
■

Scope.

*

§ 668.2

institution to students who are
completing, or intend to complete,
coursework to begin a career in teaching
and who agree to serve for not less than
four years as a full-time, highlyqualified teacher in a high-need field in
a low-income school. If the recipient of
a TEACH Grant does not complete four
years of qualified teaching service
within eight years of completing the
course of study for which the TEACH
Grant was received or otherwise fails to
meet the requirements of 34 CFR 686.12,
the amount of the TEACH Grant
converts into a Federal Direct
Unsubsidized Loan.

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§ 668.8

Eligible programs.

*

*
*
*
*
(h) * * *
(3) An educational program qualifies
as an eligible program for purposes of
the TEACH Grant program if it satisfies
the requirements of the definition of
TEACH Grant-eligible program in 34
CFR 686.2(d).
*
*
*
*
*
(Authority: 20 U.S.C. 1070a, 1070a–1, 1070b,
1070c–1, 1070c–2, 1070g, 1085, 1087aa–
1087hh, 1088, 1091; 42 U.S.C. 2753)
§ 668.14

[Amended]

6. Section 668.14(f) is amended by:
A. In paragraph (f)(1), removing the
words ‘‘paragraphs (h) and (i)’’ and

■
■

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Enclosure D
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adding, in their place, the words
‘‘paragraphs (g) and (h)’’.
■ B. In paragraph (f)(3), removing the
words ‘‘paragraph (g)’’ and adding, in
their place, the words ‘‘paragraph (f)’’.
■ 7. Section 668.19 is amended by:
■ A. In paragraph (a)(3), removing the
word ‘‘or’’ the first two times this word
appears after the acronym ‘‘ACG,’’ and
in each instance, adding the words ‘‘, or
a TEACH Grant’’ after ‘‘National
SMART Grant’’.
■ B. In paragraph (a)(3), removing the
word ‘‘or’’ the third time this word
appears after the acronym ‘‘ACG,’’ and
adding the words ‘‘, or TEACH Grant’’
after the third appearance of ‘‘National
SMART Grant’’.
■ C. Revising the authority citation to
read as follows:
§ 668.19

*

*

Financial aid history.

*

*

*

*

*

9. Section 668.22 is amended by:
A. In paragraph (a)(2), adding the
words ‘‘TEACH Grant,’’ immediately
after the words ‘‘National SMART
Grant,’’.
■ B. In paragraph (i)(2), adding a new
paragraph (i)(2)(v).
■ C. Revising the authority citation.
The addition and revision read as
follows:
■
■

*
*
*
*
(i) * * *
(2) * * *
(v) TEACH Grants.
*
*
*
*
*
(Authority: 20 U.S.C. 1070g, 1091b)

jlentini on PROD1PC65 with RULES2

*

11. Section 668.26 is amended by:
A. In paragraph (d)(1), removing the
word ‘‘or’’ the first time it appears and
adding the words ‘‘, or TEACH Grant’’
immediately after the words ‘‘National
SMART Grant’’.
■ B. In paragraph (e)(1), removing the
word ‘‘and’’ the first time it appears and
adding the words ‘‘, and TEACH Grant’’
immediately after the words ‘‘National
SMART Grant’’.
■ C. Revising the authority citation to
read as follows:

*

*

*

*

Student eligibility—general.

*

*

10. Section 668.24 is amended by:
A. In the introductory text of
paragraph (e)(1), removing the word
‘‘or’’ which appears after ‘‘ACG’’.
■ B. In the introductory text of
paragraph (e)(1), adding the words ‘‘, or
TEACH Grant’’ immediately in front of
the word ‘‘Program’’.
■ C. Revising the authority citation to
read as follows:

Jkt 214001

*

■
■

§ 668.32

§ 668.22 Treatment of title IV funds when
a student withdraws.

17:20 Jun 20, 2008

*

12. Section 668.32 is amended by:
A. In paragraph (c)(2)(ii), removing
the word ‘‘and’’.
■ B. In paragraph (c)(3), adding the
word ‘‘and’’ after the punctuation ‘‘;’’.
■ C. Adding a new paragraph (c)(4).
■ D. Adding a new paragraph (k)(9).
■ E. Revising the authority citation.
The additions and revision read as
follows:

(Authority: 20 U.S.C. 1070g, 1094)

VerDate Aug<31>2005

*

*

(Authority: 20 U.S.C. 1070a, 1070a–1, 1070b,
1070g, 1078, 1078–1, 1078–2, 1078–3, 1082,
1087, 1087a, et seq. , 1087cc, 1087hh, 1088,
1094, 1099c, 1141, 1232f; 42 U.S.C. 2753;
section 4 of Pub. L. 95–452, 92 Stat. 1101–
1109)

■
■

*

■
■

*

(Authority: 20 U.S.C. 1070g, 1094, 1099a–3)

§ 668.21 Treatment of title IV grant and
loan funds if the recipient does not begin
attendance at the institution.

*

§ 668.35 Student debts under the HEA and
to the U.S.

*

8. Section 668.21 is amended by:
A. In paragraph (a)(1), adding the
words ‘‘TEACH Grant,’’ immediately
after the word ‘‘FSEOG,’’.
■ B. Revising the authority citation to
read as follows:
■
■

*

§ 668.24 Record retention and
examinations.

§ 668.26 End of an institution’s
participation in the title IV, HEA programs.

(Authority: 20 U.S.C. 1070g, 1091, 1094)

35493

*
*
*
*
(c) * * *
(4) For the purposes of the TEACH
Grant program—
(i) For an undergraduate student other
than a student enrolled in a postbaccalaureate program, has not
completed the requirements for a first
baccalaureate degree; or
(ii) For the purposes of a student in
a first post-baccalaureate program, has
not completed the requirements for a
post-baccalaureate program as described
in 34 CFR 686.2(d);
*
*
*
*
*
(k) * * *
(9) 34 CFR 686.11 for the TEACH
Grant program; and
*
*
*
*
*
(Authority: 20 U.S.C. 1070g, 1091; 28 U.S.C.
3201(e))

13. Section 668.35 is amended by:
A. Redesignating paragraph (g)(4) as
paragraph (g)(5).
■ B. Adding a new paragraph (g)(4).
■ C. Revising the authority citation.
The addition and revision read as
follows:
■
■

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*
*
*
*
(g) * * *
(4) A student is not liable for a
TEACH Grant overpayment received in
an award year if—
(i) The institution can eliminate that
overpayment by adjusting subsequent
title IV, HEA program (other than
Federal Pell Grant, ACG, National
SMART Grant, or TEACH Grant)
payments in that same award year; or
(ii) The institution cannot eliminate
the overpayment under paragraph
(g)(4)(i) of this section but can eliminate
that overpayment by adjusting
subsequent TEACH Grant payments in
that same award year.
*
*
*
*
*
(Authority: 20 U.S.C. 1070g, 1091; 11 U.S.C.
523, 525)

14. Section 668.138 is amended by:
A. In paragraph (a), removing the
word ‘‘or’’ the first time it appears.
■ B. In paragraph (a), adding the words
‘‘, or TEACH Grant’’ immediately after
the words ‘‘National SMART Grant’’.
■ C. Revising the authority citation to
read as follows:
■
■

§ 668.138

*

*

Liability.

*

*

*

(Authority: 20 U.S.C. 1070g, 1091, 1094)

15. Section 668.139 is amended by:
A. In paragraph (c), adding the words
‘‘TEACH Grant,’’ immediately after the
words ‘‘National SMART Grant,’’.
■ B. Revising the authority citation to
read as follows:
■
■

§ 668.139 Recovery of payments and loan
disbursements to ineligible students.

*

*

*

*

*

(Authority: 20 U.S.C. 1070g, 1091, 1094)

16. Section 668.161 is amended by:
A. In paragraph (a)(3)(i), adding the
words ‘‘TEACH Grant,’’ immediately
after the words ‘‘National SMART
Grant,’’.
■ B. Revising the authority citation to
read as follows:
■
■

§ 668.161

*

*

Scope and purpose.

*

*

*

(Authority: 20 U.S.C. 1070g, 1094)

17. Section 668.162 is amended by:
A. In paragraph (d)(1), adding the
words ‘‘TEACH Grant,’’ immediately
after the words ‘‘National SMART
Grant,’’.
■ B. Revising the authority citation to
read as follows:
■
■

§ 668.162

*

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*

Requesting funds.

*

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*

*

Enclosure D

35494

Federal Register / Vol. 73, No. 121 / Monday, June 23, 2008 / Rules and Regulations

(Authority: 20 U.S.C. 1070g, 1094)

18. Section 668.163 is amended by:
A. In paragraph (c)(2), adding the
words ‘‘TEACH Grant,’’ immediately
after the words ‘‘National SMART
Grant,’’.
■ B. In the introductory text of
paragraph (c)(3), adding the words
‘‘TEACH Grant,’’ immediately after the
words ‘‘National SMART Grant,’’.
■ C. In paragraph (c)(4), adding the
words ‘‘TEACH Grant,’’ immediately
after the words ‘‘National SMART
Grant,’’.
■ D. Revising the authority citation to
read as follows:
■
■

§ 668.163
funds.

*

*

Maintaining and accounting for

*

*

*

(Authority: 20 U.S.C. 1070g, 1091, 1094)

19. Section 668.164 is amended by:
A. In paragraph (g)(1)(ii), by removing
the word ‘‘and’’ after ‘‘FSEOG,’’ and
adding the words ‘‘, and TEACH Grant,’’
immediately after the words ‘‘Federal
Perkins Loan,’’.
■ B. In paragraph (g)(2)(ii)(A), removing
the word ‘‘or’’ that appears after the
punctuation ‘‘;’’.
■ C. In paragraph (g)(2)(ii)(B), removing
the ‘‘.’’ after the words ‘‘to the student’’
and adding in its place ‘‘; or’’.
■ D. Adding a new paragraph
(g)(2)(ii)(C).
■ E. Revising the authority citation.
The addition and revision read as
follows:
■
■

§ 668.164

Disbursing funds.

*

*
*
*
*
(g) * * *
(2) * * *
(ii) * * *
(C) For an award under the TEACH
Grant program, the institution originates
the award to the student.
*
*
*
*
*
(Authority: 20 U.S.C. 1070g, 1094)
§ 668.165

[Amended]

20. Section 668.165 is amended by:
A. In the introductory text of
paragraph (a)(2), removing the word
‘‘or’’ the first time it appears and adding
the words ‘‘, or TEACH Grant’’ after
‘‘Federal Perkins Loan’’.
■ B. In paragraph (a)(2)(ii), removing the
word ‘‘or’’ the third time it appears and
adding the punctuation ‘‘,’’ in its place,
adding the words ‘‘, TEACH Grant, or
TEACH Grant disbursement’’
immediately after the words ‘‘loan
disbursement’’, and adding the words
‘‘, or the TEACH Grant proceeds
returned to the Secretary’’ after the
words ‘‘and have the loan proceeds
returned to the holder of that loan’’.

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■
■

VerDate Aug<31>2005

17:20 Jun 20, 2008

Jkt 214001

C. In paragraph (a)(2)(iii), removing
the word ‘‘or’’ before the words ‘‘loan
disbursement’’ and adding, in its place
the punctuation ‘‘,’’ and by adding the
words ‘‘, TEACH Grant, or TEACH Grant
disbursement’’ immediately after the
words ‘‘loan disbursement’’.
■ D. In paragraph (a)(4)(i) removing the
word ‘‘or’’ before the words ‘‘loan
disbursement’’ and adding, in its place
the punctuation ‘‘,’’ and adding the
words ‘‘, TEACH Grant, or TEACH Grant
disbursement’’ after the words ‘‘loan
disbursement’’.
■ E. In the introductory text of
paragraph (a)(4)(ii), adding the words
‘‘or TEACH Grant’’ before the word
‘‘proceeds’’, after the words ‘‘cancel the
loan’’, and before the words
‘‘cancellation request’’.
■ F. In paragraph (a)(4)(ii)(A), adding
the words ‘‘or TEACH Grant’’ after the
words ‘‘or a portion of a loan’’.
■ G. In paragraph (a)(4)(iii), adding the
words ‘‘or TEACH Grant’’ before the
word ‘‘proceeds’’ and after the words
‘‘cancel the loan’’.
■ H. In paragraph (a)(6)(i), adding the
words ‘‘. The process under which the
TEACH Grant program is administered
is considered to be an affirmative
confirmation process’’ after the words
‘‘loan funds’’.
■ I. In paragraph (a)(6)(ii), adding the
words ‘‘or TEACH Grant’’ before the
word ‘‘proceeds’’.
■

21. Section 668.183 is amended by:
■ A. In paragraph (b)(1), removing the
word ‘‘Your’’ the first time it appears
and adding, in its place, the words
‘‘Except as provided in paragraph (b)(3)
of this section, your’’ at the beginning of
the first sentence.
■ B. Adding a new paragraph (b)(3).
■ C. Revising the authority citation.
The addition and revision read as
follows:
■

§ 668.183 Calculating and applying cohort
default rates.

*

*
*
*
*
(b) * * *
(3) A TEACH Grant that has been
converted to a Federal Direct
Unsubsidized Loan is not considered for
the purpose of calculating and applying
cohort default rates.
*
*
*
*
*
(Authority: 20 U.S.C. 1070g, 1082, 1085,
1094, 1099c)

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PART 673—GENERAL PROVISIONS
FOR THE FEDERAL PERKINS LOAN
PROGRAM, FEDERAL WORK-STUDY
PROGRAM, AND FEDERAL
SUPPLEMENTAL EDUCATIONAL
OPPORTUNITY GRANT PROGRAM
22. The authority citation for part 673
is revised to read as follows:

■

Authority: 20 U.S.C. 421–429, 1070b–
1070b–3, 1070g, 1087aa–1087ii; 42 U.S.C.
2751–2756b, unless otherwise noted.

23. Section 673.5 is amended by:
A. In paragraph (c)(2)(iii), adding the
words ‘‘TEACH Grants,’’ immediately
after the words ‘‘the amounts of any’’
and by removing the word ‘‘loan’’ which
appears after the words ‘‘if the sum of
the’’.
■ B. Revising the authority citation to
read as follows:
■
■

§ 673.5

*

*

Overaward.

*

*

*

(Authority: 20 U.S.C. 1070b–1, 1070g,
1087dd, 1087hh; 42 U.S.C. 2753)

PART 674—FEDERAL PERKINS LOAN
PROGRAM
24. The authority citation for part 674
is revised to read as follows:

■

Authority: 20 U.S.C. 421–429, 1070g,
1087aa–1087hh, unless otherwise noted.

25. Section 674.2 is amended by:
A. In paragraph (a), adding, in
alphabetical order, the terms ‘‘Teacher
Education Assistance for College and
Higher Education (TEACH) Grant
Program’’ and ‘‘TEACH Grant’’.
■ B. Revising the authority citation to
read as follows:
■
■

§ 674.2

*

*

Definitions.

*

*

*

(Authority: 20 U.S.C. 1070g, 1094)

26. Section 674.61 is amended by:
A. In paragraph (b)(2)(ii), adding the
words ‘‘a new TEACH Grant or’’
immediately after the words ‘‘does not
receive’’.
■ B. Revising the authority citation to
read as follows:
■
■

§ 674.61

*

*

Discharge for death or disability.

*

*

*

(Authority: 20 U.S.C. 425, 1070g, 1087dd;
sec. 130(g)(2) of the Education Amendments
of 1976, Pub. L. 94–482)

PART 675—FEDERAL WORK-STUDY
PROGRAMS
27. The authority citation for part 675
is revised to read as follows:

■

Authority: 20 U.S.C. 1070g; 42 U.S.C.
2751–2756b; unless otherwise noted.

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28. Section 675.2 is amended by:
A. In paragraph (a), adding, in
alphabetical order, the terms ‘‘Teacher
Education Assistance for College and
Higher Education (TEACH) Grant
Program’’ and ‘‘TEACH Grant’’.
■ B. Revising the authority citation to
read as follows:
■
■

§ 675.2

*

*

*

*

(Authority: 20 U.S.C. 1070g, 1087aa–1087ii)

PART 676—FEDERAL
SUPPLEMENTAL EDUCATIONAL
OPPORTUNITY GRANT PROGRAM
29. The authority citation for part 676
continues to read as follows:

■

30. Section 676.2 is amended by:
A. In paragraph (a), adding, in
alphabetical order, the terms ‘‘Teacher
Education Assistance for College and
Higher Education (TEACH) Grant
Program’’ and ‘‘TEACH Grant’’.
■ B. Revising the authority citation to
read as follows:
■
■

*

Definitions.

*

*

*

PART 682—FEDERAL FAMILY
EDUCATION LOAN (FFEL) PROGRAM
31. The authority citation for part 682
is revised to read as follows:

■

Authority: 20 U.S.C 1070g, 1071 to 1087–
2, unless otherwise noted.

32. Section 682.200 is amended by:
A. In paragraph (a)(1), adding, in
alphabetical order, the terms ‘‘Teacher
Education Assistance for College and
Higher Education (TEACH) Grant
Program’’ and ‘‘TEACH Grant’’.
■ B. In paragraph (b), in paragraph (2) of
the definition of ‘‘Estimated financial
assistance,’’ adding the words ‘‘TEACH
Grant,’’ after the words ‘‘the amounts of
any’’ and removing the word ‘‘loan’’
immediately following the words ‘‘if the
sum of the’’.
■
■

33. Section 682.204 is amended by:
A. In paragraph (c), adding before the
‘‘.’’ the following words ‘‘, except that
any TEACH Grants that have been
converted to Federal Direct
Unsubsidized Loans are not counted
against annual or any aggregate loan
limits under this section.’’
■ B. Adding an authority citation to read
as follows:

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■
■

*

*

Maximum loan amounts.

*

VerDate Aug<31>2005

*

*

17:20 Jun 20, 2008

34. Section 682.215(c)(7)(ii) is
amended by removing the citation ‘‘(19
U.S.C. 2654)’’ and adding in its place,
the citation ‘‘(29 U.S.C. 2601, et seq. )’’.

35. Section 682.402 is amended by:
A. In paragraph (c)(1)(ii)(B), adding
the words ‘‘a new TEACH Grant or’’
immediately after the words ‘‘does not
receive’’.
■ B. Revising the authority citation to
read as follows:
§ 682.402 Death, disability, closed school,
false certification, unpaid refunds, and
bankruptcy payments.

*

*

*

*

(Authority: 20 U.S.C. 1070g, 1078, 1078–1,
1078–2, 1078–3, 1082, 1087)

PART 685—WILLIAM D. FORD
FEDERAL DIRECT LOAN PROGRAM
36. The authority citation for part 685
is revised to read as follows:

■

Authority: 20 U.S.C 1070g, 1087a,
et seq. , unless otherwise noted.

37. Section 685.102 is amended by:
A. In paragraph (a)(1), adding, in
alphabetical order, the terms ‘‘Teacher
Education Assistance for College and
Higher Education (TEACH) Grant
Program’’ and ‘‘TEACH Grant’’.
■ B. In paragraph (b), in paragraph (2)(i)
of the definition of ‘‘Estimated financial
assistance,’’ adding the words ‘‘TEACH
Grant,’’ after the words ‘‘the amounts of
any’’ and removing the word ‘‘loan’’
immediately following the words ‘‘if the
sum of the’’.
■ C. Revising the authority citation to
read as follows:
■
■

*

(Authority: 20 U.S.C. 1070g, 1087aa–1087ii)

§ 682.204

[Amended]

■

*

Authority: 20 U.S.C. 1070b–1070b–3,
1070g, unless otherwise noted.

§ 676.2

§ 682.215

■
■

Definitions.

*

(Authority: 20 U.S.C. 1070g, 1078, 1078–2,
1078–3, 1078–8)

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§ 685.102

*

*

Definitions.

*

*

*

(Authority: 20 U.S.C. 1070g, 1087a, et seq. )
■

38. Section 685.203 is amended by:

A. In paragraph (b), adding before the
‘‘.’’ the words ‘‘, except that any TEACH
Grants that have been converted to
Federal Direct Unsubsidized Loans are
not counted against annual or any
aggregate loan limits under this
section’’.
■ B. Revising the authority citation to
read as follows:
■

§ 685.203

*

*

Loan limits.

*

*

*

(Authority: 20 U.S.C. 1070g, 1087a, et seq. )

39. Section 685.213 is amended by:
A. In paragraph (c)(2), adding the
words ‘‘a new TEACH Grant or’’

■
■

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35495

immediately after the words ‘‘does not
receive’’.
■ B. Revising the authority citation to
read as follows:
§ 685.213 Total and permanent disability
discharge.

*

*

*

*

*

(Authority: 20 U.S.C. 1070g, 1087a, et seq. )
§ 685.217

[Amended]

40. Section 685.217(c)(7)(ii) is
amended by removing the citation ‘‘(19
U.S.C. 2654)’’ and adding, in its place,
the citation ‘‘(29 U.S.C. 2601, et seq. )’’.

■

41. A new part 686 is added to read
as follows:

■

Subpart A—Scope, Purpose and General
Definitions
Sec.
686.1 Scope and purpose.
686.2 Definitions.
686.3 Duration of student eligibility.
686.4 Institutional participation.
686.5 Enrollment status for students taking
regular and correspondence courses.
686.6 Payment from more than one
institution.
Subpart B—Application Procedures
686.10 Application.
686.11 Eligibility to receive a grant.
686.12 Agreement to serve.
Subpart C—Determination of Awards
686.20 Submission process and deadline for
a SAR or ISIR.
686.21 Calculation of a grant.
686.22 Calculation of a grant for a payment
period.
686.23 Calculation of a grant for a payment
period that occurs in two award years.
686.24 Transfer student: attendance at more
than one institution during an award
year.
686.25 Correspondence study.
Subpart D—Administration of Grant
Payments
686.30 Scope.
686.31 Determination of eligibility for
payment and cancellation of a TEACH
Grant.
686.32 Counseling requirements.
686.33 Frequency of payment.
686.34 Liability for and recovery of TEACH
Grant overpayments.
686.35 Recalculation of TEACH Grant
award amounts.
686.36 Fiscal control and fund accounting
procedures.
686.37 Institutional reporting requirements.
686.38 Maintenance and retention of
records.
Subpart E—Service and Repayment
Obligations
686.40 Documenting the service obligation.
686.41 Periods of suspension.
686.42 Discharge of agreement to serve.
686.43 Obligation to repay the grant.
Authority: 20 U.S.C. 1070g, et seq. , unless
otherwise noted.

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Subpart A—Scope, Purpose, and
General Definitions
§ 686.1

Scope and purpose.

The TEACH Grant program awards
grants to students who intend to teach,
to help meet the cost of their
postsecondary education. In exchange
for the grant, the student must agree to
serve as a full-time teacher in a highneed field, in a school serving lowincome students for at least four
academic years within eight years of
completing the program of study for
which the student received the grant. If
the student does not satisfy the service
obligation, the amounts of the TEACH
Grants received are treated as a Federal
Direct Unsubsidized Stafford Loan
(Federal Direct Unsubsidized Loan) and
must be repaid with interest.
(Authority: 20 U.S.C. 1070g, et seq. )

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§ 686.2

Definitions.

(a) Definitions for the following terms
used in this part are in the regulations
for Institutional Eligibility under the
Higher Education Act of 1965, as
amended, (HEA) 34 CFR part 600:
Award year
Clock hour
Correspondence course
Eligible institution
Institution of higher education
(institution)
Regular student
Secretary
State
Title IV, HEA program
(b) Definitions for the following terms
used in this part are in subpart A of the
Student Assistance General Provisions,
34 CFR part 668:
Academic year
Enrolled
Expected family contribution (EFC)
Full-time student
Graduate or professional student
Half-time student
HEA
Payment period
Three-quarter-time student
Undergraduate student
William D. Ford Federal Direct Loan
(Direct Loan) Program
(c) Definitions for the following terms
used in this part are in 34 CFR part 77:
Local educational agency (LEA)
State educational agency (SEA)
(d) Other terms used in this part are
defined as follows:
Academic year or its equivalent for
elementary and secondary schools
(elementary or secondary academic
year):
(1) One complete school year, or two
complete and consecutive half-years
from different school years, excluding

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summer sessions, that generally fall
within a 12-month period.
(2) If a school has a year-round
program of instruction, the Secretary
considers a minimum of nine
consecutive months to be the equivalent
of an academic year.
Agreement to serve (ATS): An
agreement under which the individual
receiving a TEACH Grant commits to
meet the service obligation described in
§ 686.12 and to comply with notification
and other provisions of the agreement.
Annual award: The maximum TEACH
Grant amount a student would receive
for enrolling as a full-time, threequarter-time, half-time, or less-thanhalf-time student and remaining in that
enrollment status for a year.
Bilingual education: An educational
program in which two languages are
used to provide content matter
instruction.
Elementary school: A nonprofit
institutional day or residential school,
including a public elementary charter
school, that provides elementary
education, as determined under State
law.
English language acquisition: The
process of acquiring English as a second
language.
Full-time teacher: A teacher who
meets the standard used by a State in
defining full-time employment as a
teacher. For an individual teaching in
more than one school, the determination
of full-time is based on the combination
of all qualifying employment.
High-need field: Includes the
following:
(1) Bilingual education and English
language acquisition.
(2) Foreign language.
(3) Mathematics.
(4) Reading specialist.
(5) Science.
(6) Special education.
(7) Another field documented as highneed by the Federal Government, a
State government or an LEA, and
approved by the Secretary and listed
in the Department’s annual Teacher
Shortage Area Nationwide Listing
(Nationwide List) in accordance with
34 CFR 682.210(q).
Highly-qualified: Has the meaning set
forth in section 9101(23) of the
Elementary and Secondary Education
Act of 1965, as amended (ESEA) or in
section 602(10) of the Individuals With
Disabilities Education Act.
Institutional Student Information
Record (ISIR): An electronic record that
the Secretary transmits to an institution
that includes an applicant’s—
(1) Personal identification
information;
(2) Application data used to calculate
the applicant’s EFC; and

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(3) EFC.
Numeric equivalent: (1) If an
otherwise eligible program measures
academic performance using an
alternative to standard numeric grading
procedures, the institution must
develop and apply an equivalency
policy with a numeric scale for
purposes of establishing TEACH Grant
eligibility. The institution’s equivalency
policy must be in writing and available
to students upon request and must
include clear differentiations of student
performance to support a determination
that a student has performed at a level
commensurate with at least a 3.25 GPA
on a 4.0 scale in that program.
(2) A grading policy that includes
only ‘‘satisfactory/unsatisfactory’’,
‘‘pass/fail’’, or other similar nonnumeric
assessments qualifies as a numeric
equivalent only if—
(i) The institution demonstrates that
the ‘‘pass’’ or ‘‘satisfactory’’ standard
has the numeric equivalent of at least a
3.25 GPA on a 4.0 scale awarded in that
program, or that a student’s performance
for tests and assignments yielded a
numeric equivalent of a 3.25 GPA on a
4.0 scale; and
(ii) For an eligible institution, the
institution’s equivalency policy is
consistent with any other standards the
institution may have developed for
academic and other title IV, HEA
program purposes, such as graduate
school applications, scholarship
eligibility, and insurance certifications,
to the extent such standards distinguish
among various levels of a student’s
academic performance.
Payment data: An electronic record
that is provided to the Secretary by an
institution showing student
disbursement information.
Post-baccalaureate program: A
program of instruction for individuals
who have completed a baccalaureate
degree, that—
(1) Does not lead to a graduate degree;
(2) Consists of courses required by a
State in order for a student to receive a
professional certification or licensing
credential that is required for
employment as a teacher in an
elementary school or secondary school
in that State, except that it does not
include any program of instruction
offered by a TEACH Grant-eligible
institution that offers a baccalaureate
degree in education; and
(3) Is treated as an undergraduate
program of study for the purposes of
title IV of the HEA.
Retiree: An individual who has
decided to change his or her occupation
for any reason and who has expertise, as
determined by the institution, in a highneed field.

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Scheduled Award: The maximum
amount of a TEACH Grant that a fulltime student could receive for a year.
School serving low-income students
(low-income school): An elementary or
secondary school that—
(1) Is in the school district of an LEA
that is eligible for assistance pursuant to
title I of the ESEA;
(2) Has been determined by the
Secretary to be a school in which more
than 30 percent of the school’s total
enrollment is made up of children who
qualify for services provided under title
I of the ESEA; and
(3) Is listed in the Department’s
Annual Directory of Designated LowIncome Schools for Teacher
Cancellation Benefits. The Secretary
considers all elementary and secondary
schools operated by the Bureau of
Indian Education (BIE) in the
Department of the Interior or operated
on Indian reservations by Indian tribal
groups under contract or grant with the
BIE to qualify as schools serving lowincome students.
Secondary school: A nonprofit
institutional day or residential school,
including a public secondary charter
school, that provides secondary
education, as determined under State
law, except that the term does not
include any education beyond grade 12.
Student Aid Report (SAR): A report
provided to an applicant by the
Secretary showing the amount of his or
her expected family contribution.
TEACH Grant-eligible institution: An
eligible institution as defined in 34 CFR
part 600 that meets financial
responsibility standards established in
34 CFR part 668, subpart L, or that
qualifies under an alternative standard
in 34 CFR 668.175 and—
(1) Provides a high-quality teacher
preparation program at the
baccalaureate or master’s degree level
that—
(i)(A) Is accredited by a specialized
accrediting agency recognized by the
Secretary for the accreditation of
professional teacher education
programs; or
(B) Is approved by a State and
includes a minimum of 10 weeks of fulltime pre-service clinical experience, or
its equivalent, and provides either
pedagogical coursework or assistance in
the provision of such coursework; and
(ii) Provides supervision and support
services to teachers, or assists in the
provision of services to teachers, such
as—
(A) Identifying and making available
information on effective teaching skills
or strategies;
(B) Identifying and making available
information on effective practices in the

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supervision and coaching of novice
teachers; and
(C) Mentoring focused on developing
effective teaching skills and strategies;
(2) Provides a two-year program
that—
(i) Is acceptable for full credit in a
baccalaureate teacher preparation
program of study offered by an
institution described in paragraph (1) of
this definition, as demonstrated by the
institutions; or
(ii) Is acceptable for full credit in a
baccalaureate degree program in a highneed field at an institution described in
paragraph (3) of this definition, as
demonstrated by the institutions;
(3) Offers a baccalaureate degree that,
in combination with other training or
experience, will prepare an individual
to teach in a high-need field as defined
in this part and has entered into an
agreement with an institution described
in paragraphs (1) or (4) of this definition
to provide courses necessary for its
students to begin a career in teaching; or
(4) Provides a post-baccalaureate
program of study.
TEACH Grant-eligible program: An
eligible program, as defined in 34 CFR
668.8, is a program of study that is
designed to prepare an individual to
teach as a highly-qualified teacher in a
high-need field and leads to a
baccalaureate or master’s degree, or is a
post-baccalaureate program of study. A
two-year program of study that is
acceptable for full credit toward a
baccalaureate degree is considered to be
a program of study that leads to a
baccalaureate degree.
Teacher: A person who provides
direct classroom teaching or classroomtype teaching in a non-classroom
setting, including special education
teachers and reading specialists.
Teacher preparation program: A
State-approved course of study, the
completion of which signifies that an
enrollee has met all the State’s
educational or training requirements for
initial certification or licensure to teach
in the State’s elementary or secondary
schools. A teacher preparation program
may be a regular program or an
alternative route to certification, as
defined by the State. For purposes of a
TEACH Grant, the program must be
provided by an institution of higher
education.
(Authority: 20 U.S.C. 1070g, et seq. )
§ 686.3

Duration of student eligibility.

(a) An undergraduate or postbaccalaureate student enrolled in a
TEACH Grant-eligible program may
receive the equivalent of up to four
Scheduled Awards during the period
required for the completion of the first

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undergraduate baccalaureate program of
study and first post-baccalaureate
program of study combined.
(b) A graduate student is eligible to
receive the equivalent of up to two
Scheduled Awards during the period
required for the completion of a TEACH
Grant-eligible master’s degree program
of study.
(Authority: 20 U.S.C. 1070g, et seq. )
§ 686.4

Institutional participation.

(a) A TEACH Grant-eligible institution
that offers one or more TEACH Granteligible programs may elect to
participate in the TEACH Grant
program.
(b) If an institution begins
participation in the TEACH Grant
program during an award year, a student
enrolled at and attending that
institution is eligible to receive a grant
under this part for the payment period
during which the institution begins
participation and any subsequent
payment period.
(c) If an institution ceases to
participate in the TEACH Grant program
or becomes ineligible to participate in
the TEACH Grant program during an
award year, a student who was
attending the institution and who
submitted a SAR with an official EFC to
the institution, or for whom the
institution obtained an ISIR with an
official EFC, before the date the
institution became ineligible will
receive a TEACH Grant for that award
year for—
(1) The payment periods that the
student completed before the institution
ceased participation or became
ineligible to participate; and
(2) The payment period in which the
institution ceased participation or
became ineligible to participate.
(d) An institution that ceases to
participate in the TEACH Grant program
or becomes ineligible to participate in
the TEACH Grant program must, within
45 days after the effective date of the
loss of eligibility, provide to the
Secretary—
(1) The name and other student
identifiers as required by the Secretary
of each eligible student under § 686.11
who, during the award year, submitted
a SAR with an official EFC to the
institution or for whom it obtained an
ISIR with an official EFC before it
ceased to participate in the TEACH
Grant program or became ineligible to
participate;
(2) The amount of funds paid to each
student for that award year;
(3) The amount due each student
eligible to receive a grant through the
end of the payment period during which
the institution ceased to participate in

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the TEACH Grant program or became
ineligible to participate; and
(4) An accounting of the TEACH
Grant program expenditures for that
award year to the date of termination.
(Authority: 20 U.S.C. 1070g, et seq. )
§ 686.5 Enrollment status for students
taking regular and correspondence
courses.

(a) If, in addition to regular
coursework, a student takes
correspondence courses from either his
or her own institution or another
institution having an arrangement for
this purpose with the student’s
institution, the correspondence work
may be included in determining the
student’s enrollment status to the extent

permitted under paragraph (b) of this
section.
(b) Except as noted in paragraph (c) of
this section, the correspondence work
that may be included in determining a
student’s enrollment status is that
amount of work that—
(1) Applies toward a student’s degree
or post-baccalaureate program of study
or is remedial work taken by the student
to help in his or her TEACH Granteligible program;
(2) Is completed within the period of
time required for regular coursework;
and
(3) Does not exceed the amount of a
student’s regular coursework for the
payment period for which enrollment
status is being calculated.
(c)(1) Notwithstanding the limitation
in paragraph (b)(3) of this section, a

student who would be a half-time
student based solely on his or her
correspondence work is considered a
half-time student unless the calculation
in paragraph (b) of this section produces
an enrollment status greater than halftime.
(2) A student who would be a lessthan-half-time student based solely on
his or her correspondence work or a
combination of correspondence work
and regular coursework is considered a
less-than-half-time student.
(d) The following chart provides
examples of the application of the
regulations set forth in this section. It
assumes that the institution defines fulltime enrollment as 12 credits per term,
making half-time enrollment equal to
six credits per term.

Under § 686.5

No. of credit
hours
regular work

No. of credit
hours
correspondence

(b)(3) .......................................................................................................
(b)(3) .......................................................................................................
(b)(3) .......................................................................................................
(b)(3) .......................................................................................................
(b)(3) .......................................................................................................
(b)(3) and (c) ...........................................................................................
(c) * ..........................................................................................................

3
3
3
6
6
2
....................

3
6
9
3
6
6
....................

Total course
load in
credit hours
to
determine
enrollment
status
6
6
6
9
12
6
....................

Enrollment status

Half-time.
Half-time.
Half-time.
Three-quarter-time.
Full-time.
Half-time.
Less-than-half-time.

* Any combination of regular and correspondence work that is greater than zero, but less than six hours.
(Authority: 20 U.S.C. 1070g, et seq. )
§ 686.6 Payment from more than one
institution.

A student may not receive grant
payments under this part concurrently
from more than one institution.
(Authority: 20 U.S.C. 1070g, et seq. )

Subpart B—Application Procedures

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§ 686.10

Application.

(a) To receive a grant under this part,
a student must—
(1) Complete and submit an approved
signed application, as designated by the
Secretary. A copy of this application is
not acceptable;
(2) Complete and sign an agreement to
serve and promise to repay; and
(3) Provide any additional
information and assurances requested
by the Secretary.
(b) The student must submit an
application to the Secretary by—
(1) Sending the completed application
to the Secretary; or
(2) Providing the application, signed
by all appropriate family members, to
the institution which the student
attends or plans to attend so that the
institution can transmit the application

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information to the Secretary
electronically.
(c) The student must provide the
address of his or her residence.
(d) For each award year, the Secretary,
through publication in the Federal
Register, establishes deadline dates for
submitting to the Department the
application and additional information
and for making corrections to the
information provided.
(Authority: 20 U.S.C. 1070g, et seq. )
§ 686.11

Eligibility to receive a grant.

(a) Undergraduate, postbaccalaureate, and graduate students.
(1) Except as provided in paragraph (b)
of this section, a student who meets the
requirements of 34 CFR part 668,
subpart C, is eligible to receive a TEACH
Grant if the student—
(i) Has submitted a completed
application;
(ii) Has signed an agreement to serve
as required under § 686.12;
(iii) Is enrolled in a TEACH Granteligible institution in a TEACH Granteligible program;
(iv) Is completing coursework and
other requirements necessary to begin a
career in teaching or plans to complete

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such coursework and requirements prior
to graduating; and
(v) Has—
(A) If the student is in the first year
of a program of undergraduate
education as determined by the
institution—
(1) A final cumulative secondary
school grade point average (GPA) upon
graduation of at least 3.25 on a 4.0 scale,
or the numeric equivalent; or
(2) A cumulative GPA of at least 3.25
on a 4.0 scale, or the numeric
equivalent, based on courses taken at
the institution through the mostrecently completed payment period;
(B) If the student is beyond the first
year of a program of undergraduate
education as determined by the
institution, a cumulative undergraduate
GPA of at least 3.25 on a 4.0 scale, or
the numeric equivalent, through the
most recently completed payment
period;
(C) If the student is a graduate student
during the first payment period, a
cumulative undergraduate GPA of at
least 3.25 on a 4.0 scale, or the numeric
equivalent;
(D) If the student is a graduate student
beyond the first payment period, a

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cumulative graduate GPA of at least 3.25
on a 4.0 scale, or the numeric
equivalent, through the most-recently
completed payment period; or
(E) A score above the 75th percentile
of scores achieved by all students taking
the test during the period the student
took the test on at least one of the
batteries from a nationally-normed
standardized undergraduate, graduate,
or post-baccalaureate admissions test,
except that such test may not include a
placement test.
(2)(i) An institution must document
the student’s secondary school GPA
under § 686.11(a)(1)(v)(A) using—
(A) Documentation provided directly
to the institution by the cognizant
authority; or
(B) Documentation from the cognizant
authority provided by the student.
(ii) A cognizant authority includes,
but is not limited to—
(A) An LEA;
(B) An SEA or other State agency; or
(C) A public or private secondary
school.
(iii) A home-schooled student’s parent
or guardian is the cognizant authority
for purposes of providing the
documentation of a home-schooled
student’s secondary school GPA.
(iv) If an institution has reason to
believe the documentation provided by
a student under paragraph (a)(2)(i)(B) of
this section is inaccurate or incomplete,
the institution must confirm the
student’s grades by using
documentation provided directly to the
institution by the cognizant authority.
(b) Current or former teachers or
retirees. A student who has submitted a
completed application and meets the
requirements of 34 CFR part 668,
subpart C, is eligible to receive a TEACH
Grant if the student—
(1) Has signed an agreement to serve
as required under § 686.12;
(2) Is a current teacher or retiree who
is applying for a grant to obtain a
master’s degree or is or was a teacher
who is pursuing certification through a
high-quality alternative certification
route; and
(3) Is enrolled in a TEACH Granteligible institution in a TEACH Granteligible program during the period
required for the completion of a master’s
degree.
(c) Transfer students. If a student
transfers from one institution to the
current institution and does not qualify
under § 686.11(a)(1)(v)(E), the current
institution must determine that
student’s eligibility for a TEACH Grant
for the first payment period using either
the method described in paragraph
(c)(1) of this section or the method
described in paragraph (c)(2) of this

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section, whichever method coincides
with the current institution’s academic
policy. For an eligible student who
transfers to an institution that—
(1) Does not incorporate grades from
coursework that it accepts on transfer
into the student’s GPA at the current
institution, the current institution, for
the courses accepted upon transfer—
(i) Must calculate the student’s GPA
for the first payment period of
enrollment using the grades earned by
the student in the coursework from any
prior postsecondary institution that it
accepts; and
(ii) Must, for all subsequent payment
periods, apply its academic policy and
not incorporate the grades from the
coursework that it accepts on transfer
into the GPA at the current institution;
or
(2) Incorporates grades from the
coursework that it accepts on transfer
into the student’s GPA at the current
institution, the current institution must
use the grades assigned to the
coursework accepted by the current
institution as the student’s cumulative
GPA to determine eligibility for the first
payment period of enrollment and all
subsequent payment periods in
accordance with its academic policy.
(Authority: 20 U.S.C. 1070g, et seq. )
§ 686.12

Agreement to serve.

(a) General. A student who meets the
eligibility requirements in § 686.11 may
receive a TEACH Grant only after he or
she signs an agreement to serve
provided by the Secretary and receives
counseling in accordance with § 686.32.
(b) Contents of the agreement to serve.
The agreement provides that, for each
TEACH Grant-eligible program for
which the student received TEACH
Grant funds, the grant recipient must
fulfill a service obligation by performing
creditable teaching service by—
(1) Serving as a full-time teacher for
a total of not less than four elementary
or secondary academic years within
eight calendar years after completing the
program or otherwise ceasing to be
enrolled in the program for which the
recipient received the TEACH Grant—
(i) In a low-income school;
(ii) As a highly-qualified teacher; and
(iii) In a high-need field in the
majority of classes taught during each
elementary and secondary academic
year.
(2) Submitting, upon completion of
each year of service, documentation of
the service in the form of a certification
by a chief administrative officer of the
school; and
(3) Complying with the terms,
conditions, and other requirements
consistent with §§ 686.40–686.43 that

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35499

the Secretary determines to be
necessary.
(c) Completion of more than one
service obligation.
(1) A grant recipient must complete a
service obligation for each program of
study for which he or she received
TEACH Grants. Each service obligation
begins following the completion or
other cessation of enrollment by the
student in the TEACH Grant-eligible
program for which the student received
TEACH Grant funds. However,
creditable teaching service may apply to
more than one service obligation.
(2) A grant recipient may request a
suspension, in accordance with
§ 686.41, of the eight-year time period in
paragraph (b)(1) of this section.
(d) Majoring and serving in a highneed field. A grant recipient who
completes a TEACH Grant-eligible
program in a field that is listed in the
Nationwide List cannot satisfy his or her
service obligation to teach in that highneed field unless the high-need field in
which he or she has prepared to teach
is listed in the Nationwide List for the
State in which the grant recipient begins
teaching at the time the recipient begins
teaching in that field.
(e) Repayment for failure to complete
service obligation. If a grant recipient
fails or refuses to carry out the required
service obligation described in
paragraph (b) of this section, the TEACH
Grants received by the recipient must be
repaid and will be treated as a Federal
Direct Unsubsidized Loan, with interest
accruing from the date of each TEACH
Grant disbursement, in accordance with
applicable sections of subpart B of 34
CFR part 685.
(Authority: 20 U.S.C. 1070g, et seq. )

Subpart C—Determination of Awards
§ 686.20 Submission process and deadline
for a SAR or ISIR.

(a) Submission process. (1) Except as
provided in paragraph (a)(2) of this
section, an institution must disburse a
TEACH Grant to a student who is
eligible under § 686.11 and is otherwise
qualified to receive that disbursement
and electronically transmit
disbursement data to the Secretary for
that student if—
(i) The student submits a SAR with an
official EFC to the institution; or
(ii) The institution obtains an ISIR
with an official EFC for the student.
(2) In determining a student’s
eligibility to receive a grant under this
part, an institution is entitled to assume
that the SAR information or ISIR
information is accurate and complete
except under the conditions set forth in
34 CFR 668.16(f).

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(b) SAR or ISIR deadline. Except as
provided in 34 CFR 668.164(g), for a
student to receive a grant under this part
in an award year, the student must
submit the relevant parts of the SAR
with an official EFC to his or her
institution or the institution must obtain
an ISIR with an official EFC by the
earlier of—
(1) The last date that the student is
still enrolled and eligible for payment at
that institution; or
(2) By the deadline date established
by the Secretary through publication of
a notice in the Federal Register.
(Authority: 20 U.S.C. 1070g, et seq. )

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§ 686.21

Calculation of a grant.

(a)(1)(i) The Scheduled Award for a
TEACH Grant for an eligible student is
$4,000.
(ii) Each Scheduled Award remains
available to an eligible student until the
$4,000 is disbursed.
(2)(i) The aggregate amount that a
student may receive in TEACH Grants
for undergraduate and postbaccalaureate study may not exceed
$16,000.
(ii) The aggregate amount that a
student may receive in TEACH Grants
for a master’s degree may not exceed
$8,000.
(b) The annual award for—
(1) A full-time student is $4,000;
(2) A three-quarter-time student is
$3,000;
(3) A half-time student is $2,000; and
(4) A less-than-half-time student is
$1,000.
(c) Except as provided in paragraph
(d) of this section, the amount of a
student’s grant under this part, in
combination with the other student
financial assistance available to the
student, including the amount of a
Federal Pell Grant for which the student
is eligible, may not exceed the student’s
cost of attendance at the TEACH Granteligible institution. Other student
financial assistance is estimated
financial assistance, as defined in 34
CFR 673.5(c).
(d) A TEACH Grant may replace a
student’s EFC, but the amount of the
grant that exceeds the student’s EFC is
considered estimated financial
assistance, as defined in 34 CFR
673.5(c).
(e) In determining a student’s
payment for a payment period, an
institution must include—
(1) In accordance with 34 CFR 668.20,
any noncredit or reduced credit courses
that an institution determines are
necessary—
(i) To help a student be prepared for
the pursuit of a first undergraduate

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baccalaureate or post-baccalaureate
degree or certificate; or
(ii) In the case of English language
instruction, to enable the student to
utilize already existing knowledge,
training, or skills; and
(2) In accordance with 34 CFR 668.5,
a student’s participation in a program of
study abroad if it is approved for credit
by the home institution at which the
student is enrolled.
(Authority: 20 U.S.C. 1070g, et seq. )
§ 686.22 Calculation of a grant for a
payment period.

(a) Eligibility for payment formula—
(1) Programs using standard terms with
at least 30 weeks of instructional time.
A student’s grant for a payment period
is calculated under paragraph (b) or (d)
of this section if—
(i) The student is enrolled in an
eligible program that—
(A) Measures progress in credit hours;
(B) Is offered in semesters, trimesters,
or quarters; and
(C)(1) For an undergraduate student,
requires the student to enroll for at least
12 credit hours in each term in the
award year to qualify as a full-time
student; or
(2) For a graduate student, each term
in the award year meets the minimum
full-time enrollment status established
by the institution for a semester,
trimester, or quarter; and
(ii) The program uses an academic
calendar that provides at least 30 weeks
of instructional time in—
(A) Two semesters or trimesters in the
fall through the following spring, or
three quarters in the fall, winter, and
spring, none of which overlaps any
other term (including a summer term) in
the program; or
(B) Any two semesters or trimesters,
or any three quarters where—
(1) The institution starts its terms for
different cohorts of students on a
periodic basis (e.g., monthly);
(2) The program is offered exclusively
in semesters, trimesters, or quarters; and
(3) Students are not allowed to be
enrolled simultaneously in overlapping
terms and must stay with the cohort in
which they start unless they withdraw
from a term (or skip a term) and reenroll
in a subsequent term.
(2) Programs using standard terms
with less than 30 weeks of instructional
time. A student’s payment for a
payment period is calculated under
paragraph (c) or (d) of this section if—
(i) The student is enrolled in an
eligible program that—
(A) Measures progress in credit hours;
(B) Is offered in semesters, trimesters,
or quarters;
(C)(1) For an undergraduate student,
requires the student to enroll in at least

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12 credit hours in each term in the
award year to qualify as a full-time
student; or
(2) For a graduate student, each term
in the award year meets the minimum
full-time enrollment status established
by the institution for a semester,
trimester, or quarter; and
(D) Is not offered with overlapping
terms; and
(ii) The institution offering the
program—
(A) Provides the program using an
academic calendar that includes two
semesters or trimesters in the fall
through the following spring, or three
quarters in the fall, winter, and spring;
and
(B) Does not provide at least 30 weeks
of instructional time in the terms
specified in paragraph (a)(2)(ii)(A) of
this section.
(3) Other programs using terms and
credit hours. A student’s payment for a
payment period is calculated under
paragraph (d) of this section if the
student is enrolled in an eligible
program that—
(i) Measures progress in credit hours;
and
(ii) Is offered in academic terms other
than those described in paragraphs
(a)(1) and (2) of this section.
(4) Programs not using terms or using
clock hours. A student’s payment for
any payment period is calculated under
paragraph (e) of this section if the
student is enrolled in an eligible
program that—
(i) Is offered in credit hours but is not
offered in academic terms; or
(ii) Is offered in clock hours.
(5) Programs for which an exception
to the academic year definition has been
granted under 34 CFR 668.3. If an
institution receives a waiver from the
Secretary of the 30 weeks of
instructional time requirement under 34
CFR 668.3, an institution may calculate
a student’s payment for a payment
period using the following
methodologies:
(i) If the program is offered in terms
and credit hours, the institution uses the
methodology in—
(A) Paragraph (b) of this section
provided that the program meets all the
criteria in paragraph (a)(1) of this
section, except that in lieu of meeting
the requirements in paragraph
(a)(1)(ii)(B) of this section, the program
provides at least the same number of
weeks of instructional time in the terms
specified in paragraph (a)(1)(ii)(A) of
this section as are in the program’s
academic year; or
(B) Paragraph (d) of this section.
(ii) The institution uses the
methodology described in paragraph (e)

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Enclosure D
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of this section if the program is offered
in credit hours without terms.
(b) Programs using standard terms
with at least 30 weeks of instructional
time. The payment for a payment
period, i.e., an academic term, for a
student in a program using standard
terms with at least 30 weeks of
instructional time in two semesters or
trimesters or in three quarters as
described in paragraph (a)(1)(ii) of this
section, is calculated by—
(1) Determining his or her enrollment
status for the term;
(2) Based upon that enrollment status,
determining his or her annual award;
and
(3) Dividing the amount described in
paragraph (b)(2) of this section by—
(i) Two at institutions using semesters
or trimesters or three at institutions
using quarters; or

(ii) The number of terms over which
the institution chooses to distribute the
student’s annual award if—
(A) An institution chooses to
distribute all of the student’s annual
award determined under paragraph
(b)(2) of this section over more than two
terms at institutions using semesters or
trimesters or more than three quarters at
institutions using quarters; and
(B) The number of weeks of
instructional time in the terms,
including the additional term or terms,
equals the weeks of instructional time in
the program’s academic year.
(c) Programs using standard terms
with less than 30 weeks of instructional
time. The payment for a payment
period, i.e., an academic term, for a
student in a program using standard
terms with less than 30 weeks of

35501

instructional time in two semesters or
trimesters or in three quarters as
described in paragraph (a)(2)(ii)(A) of
this section, is calculated by—
(1) Determining his or her enrollment
status for the term;
(2) Based upon that enrollment status,
determining his or her annual award;
(3) Multiplying his or her annual
award determined under paragraph
(c)(2) of this section by the following
fraction as applicable:
(i) In a program using semesters or
trimesters—
The number of weeks of instructional
time offered in the program in the fall
and spring semesters or trimesters
The number of weeks in the program’s
academic year
(ii) In a program using quarters—

The number of weeks of instructional time offered in the prrogram in the fall, winter, and spring quarters
The number of weeks in the program’s academic year
; and
(4)(i) Dividing the amount determined
under paragraph (c)(3) of this section by
two for programs using semesters or
trimesters or three for programs using
quarters; or
(ii) Dividing the student’s annual
award determined under paragraph
(c)(2) of this section by the number of
terms over which the institution
chooses to distribute the student’s
annual award if—
(A) An institution chooses to
distribute all of the student’s annual

award determined under paragraph
(c)(2) of this section over more than two
terms for programs using semesters or
trimesters or more than three quarters
for programs using quarters; and
(B) The number of weeks of
instructional time in the terms,
including the additional term or terms,
equals the weeks of instructional time in
the program’s academic year definition.
(d) Other programs using terms and
credit hours. The payment for a
payment period, i.e., an academic term,
for a student in a program using terms

and credit hours, other than those
described in paragraph (a)(1) or (2) of
this section, is calculated by—
(1) Determining his or her enrollment
status for the term;
(2) Based upon that enrollment status,
determining his or her annual award;
and
(3) Multiplying his or her annual
award determined under paragraph
(d)(2) of this section by the following
fraction:

The number of weeks of instructional time in the term
The nuumber of weeks of instructional time in the program’s acaddemic year

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; or

(2)

The number of weeks of instructional time in the payment peeriod
The number of weeks of instructional time in the proggram’s academic year
(f) Maximum disbursement. A single
disbursement may not exceed 50

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percent of an award determined under
paragraph (d) or (e) of this section. If a

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payment for a payment period
calculated under paragraph (d) or (e) of

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ER23JN08.025

The number of credit or clock hours in the payment period
Thhe number of credit or clock hours in the program’s academ
mic year

ER23JN08.026

calculated by multiplying the
Scheduled Award by the lesser of—
(1)

ER23JN08.024

student in a program using credit hours
without terms or using clock hours is

ER23JN08.023

(e) Programs using credit hours
without terms or clock hours. The
payment for a payment period for a

Enclosure D

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Federal Register / Vol. 73, No. 121 / Monday, June 23, 2008 / Rules and Regulations

this section would require the
disbursement of more than 50 percent of
a student’s annual award in that
payment period, the institution must
make at least two disbursements to the
student in that payment period. The
institution may not disburse an amount
that exceeds 50 percent of the student’s
annual award until the student has
completed the period of time in the
payment period that equals, in terms of
weeks of instructional time, 50 percent
of the weeks of instructional time in the
program’s academic year.
(g) Minimum payment. No payment
for a payment period as determined
under this section or § 686.25 may be
less than $25.
(h) Definition of academic year. For
purposes of this section and § 686.25, an
institution must define an academic
year—
(1) For each of its TEACH Granteligible undergraduate programs of
study, including post-baccalaureate
programs of study, in terms of the
number of credit or clock hours and
weeks of instructional time in
accordance with the requirements of 34
CFR 668.3; and
(2) For each of its TEACH Granteligible master’s degree programs of
study in terms of the number of weeks
of instructional time in accordance with
the requirements of 34 CFR 668.3 and
the minimum number of credit or clock
hours a full-time student would be
expected to complete in the weeks of
instructional time of the program’s
academic year.
(i) Payment period completing a
Scheduled Award. In a payment period,
if a student is completing a Scheduled
Award, the student’s payment for the
payment period—

(1) Is calculated based on the total
credit or clock hours and weeks of
instructional time in the payment
period; and
(2) Is the remaining amount of the
Scheduled Award being completed plus
an amount from the next Scheduled
Award, if available, up to the payment
for the payment period.
(Authority: 20 U.S.C. 1070g, et seq. )
§ 686.23 Calculation of a grant for a
payment period that occurs in two award
years.

If a student enrolls in a payment
period that is scheduled to occur in two
award years—
(a) The entire payment period must be
considered to occur within one award
year;
(b) The institution must determine for
each TEACH Grant recipient the award
year in which the payment period will
be placed subject to the restriction set
forth in paragraph (c) of this section;
(c) The institution must place a
payment period with more than six
months scheduled to occur within one
award year in that award year;
(d) If the institution places the
payment period in the first award year,
it must pay a student with funds from
the first award year; and
(e) If the institution places the
payment period in the second award
year, it must pay a student with funds
from the second award year.
(Authority: 20 U.S.C. 1070g, et seq. )
§ 686.24 Transfer student: attendance at
more than one institution during an award
year.

(a) If a student who receives a TEACH
Grant at one institution subsequently
enrolls at a second institution, the

student may receive a grant at the
second institution only if—
(1) The student submits a SAR with
an official EFC to the second institution;
or
(2) The second institution obtains an
ISIR with an official EFC.
(b) The second institution must
calculate the student’s award in
accordance with § 686.22 or 686.25.
(c) The second institution may pay a
TEACH Grant only for that period in
which a student is enrolled in a TEACH
Grant-eligible program at that
institution.
(d) The student’s TEACH Grant for
each payment period is calculated
according to the procedures in § 686.22
or 686.25 unless the remaining balance
of the Scheduled Award at the second
institution is the balance of the
student’s last Scheduled Award and is
less than the amount the student would
normally receive for that payment
period.
(e) A transfer student must repay any
amount received in an award year that
exceeds the amount which he or she
was eligible to receive.
(Authority: 20 U.S.C. 1070g, et seq.)
§ 686.25

Correspondence study.

(a) An institution calculates a TEACH
Grant for a payment period for a student
in a program of study offered by
correspondence courses without terms,
but not including any residential
component, by—
(1) Using the half-time annual award;
and
(2) Multiplying the half-time annual
award by the lesser of—
(i)

The number of credit or clock hours in the payment period
Thhe number of credit or clock hours in the program’s academ
mic year
; or

(ii)

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his or her academic year or program;
and
(ii) The second payment period must
be the period of time in which the
student completes the lesser of the
second half of the academic year or
program; and
(2)(i) The institution must make the
first payment to a student for an

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academic year, as calculated under
paragraph (a) of this section, after the
student submits 25 percent of the
lessons or otherwise completes 25
percent of the work scheduled for the
program or the academic year,
whichever occurs last; and
(ii) The institution must make the
second payment to a student for an

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ER23JN08.028

(b) For purposes of paragraph (a) of
this section—
(1) An academic year as measured in
credit or clock hours must consist of
two payment periods—
(i) The first payment period must be
the period of time in which the student
completes the lesser of the first half of

ER23JN08.027

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The number of weeks of instructional time in the payment peeriod
The number of weeks of instructional time in the proggram’s academic year

Enclosure D
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academic year, as calculated under
paragraph (a) of this section, after the
student submits 75 percent of the
lessons or otherwise completes 75
percent of the work scheduled for the
program or the academic year,
whichever occurs last.
(c) In a program of correspondence
study offered by correspondence
courses using terms but not including
any residential component—
(1) The institution must prepare a
written schedule for submission of
lessons that reflects a workload of at
least 30 hours of preparation per
semester hour or 20 hours of
preparation per quarter hour during the
term;
(2)(i) If the student is enrolled in at
least six credit hours that commence
and are completed in that term, the halftime annual award is used; or
(ii) If the student is enrolled in less
than six credit hours that commence
and are completed in that term the lessthan-half-time annual award is used;
(3) A payment for a payment period
is calculated using the formula in
§ 686.22(d) except that paragraphs (c)(1)
and (2) of this section are used in lieu
of § 686.22(d)(1) and (2), respectively;
and
(4) The institution must make the
payment to a student for a payment
period after that student completes 50
percent of the lessons or otherwise
completes 50 percent of the work
scheduled for the term, whichever
occurs last.
(d) Payments for periods of residential
training must be calculated under
§ 686.22(d) if the residential training is
offered using terms and credit hours or
under § 686.22(e) if the residential
training is offered using credit hours
without terms or clock hours.
(Authority: 20 U.S.C. 1070g, et seq. )

Subpart D—Administration of Grant
Payments
§ 686.30

Scope.

This subpart deals with TEACH Grant
program administration by a TEACH
Grant-eligible institution.
(Authority: 20 U.S.C. 1070g, et seq.)

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§ 686.31 Determination of eligibility for
payment and cancellation of a TEACH
Grant.

(a) For each payment period, an
institution may pay a grant under this
part to an eligible student only after it
determines that the student—
(1) Is eligible under § 686.11;
(2) Has completed the relevant initial
or subsequent counseling as required in
§ 686.32;

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(3) Has signed an agreement to serve
as described in § 686.12;
(4) Is enrolled in a TEACH Granteligible program; and
(5) If enrolled in a credit-hour
program without terms or a clock-hour
program, has completed the payment
period, as defined in 34 CFR 668.4, for
which he or she has been paid a grant.
(b)(1) If an institution determines at
the beginning of a payment period that
a student is not maintaining satisfactory
progress, but changes that determination
before the end of the payment period,
the institution may pay a TEACH Grant
to the student for the entire payment
period.
(2) If an institution determines at the
beginning of a payment period that a
student enrolled in a TEACH Granteligible program is not maintaining the
required GPA for a TEACH Grant under
§ 686.11 or is not pursuing a career in
teaching, but changes that
determination before the end of the
payment period, the institution may pay
a TEACH Grant to the student for the
entire payment period.
(c) If an institution determines at the
beginning of a payment period that a
student is not maintaining satisfactory
progress or the necessary GPA for a
TEACH Grant under § 686.11 or is not
pursuing a career in teaching, but
changes that determination after the end
of the payment period, the institution
may not pay the student a TEACH Grant
for that payment period or make
adjustments in subsequent payments to
compensate for the loss of aid for that
period.
(d) An institution may make one
disbursement for a payment period to an
otherwise eligible student if—
(1)(i) The student’s final high school
GPA is not yet available; or
(ii) The student’s cumulative GPA
through the prior payment period under
§ 686.11 is not yet available; and
(2) The institution assumes liability
for any overpayment if the student fails
to meet the required GPA to qualify for
the disbursement.
(e)(1) In accordance with 34 CFR
668.165, before disbursing a TEACH
Grant for any award year, an institution
must—
(i) Notify the student of the amount of
TEACH Grant funds that the student is
eligible to receive, how and when those
funds will be disbursed, and the
student’s right to cancel all or a portion
of the TEACH Grant; and
(ii) Return the TEACH Grant
proceeds, cancel the TEACH Grant, or
both, if the institution receives a TEACH
Grant cancellation request from the
student by the later of the first day of
a payment period or 14 days after the

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35503

date it notifies the student of his or her
right to cancel all or a portion of a
TEACH Grant.
(2)(i) If a student requests cancellation
of a TEACH Grant after the period of
time in paragraph (e)(1)(ii) of this
section, but within 120 days of the
TEACH Grant disbursement date, the
institution may return the TEACH Grant
proceeds, cancel the TEACH Grant, or
do both.
(ii) If the institution does not return
the TEACH Grant proceeds, or cancel
the TEACH Grant, the institution must
notify the student that he or she may
contact the Secretary to request that the
TEACH Grant be converted to a Federal
Direct Unsubsidized Loan.
(Authority: 20 U.S.C. 1070g, et seq. )
§ 686.32

Counseling requirements.

(a) Initial counseling. (1) An
institution must ensure that initial
counseling is conducted with each
TEACH Grant recipient prior to making
the first disbursement of the grant.
(2) The initial counseling must be in
person, by audiovisual presentation, or
by interactive electronic means. In each
case, the institution must ensure that an
individual with expertise in title IV,
HEA programs is reasonably available
shortly after the counseling to answer
the student’s questions. As an
alternative, in the case of a student
enrolled in a correspondence program of
study or a study-abroad program of
study approved for credit at the home
institution, the student may be provided
with written counseling materials before
the grant is disbursed.
(3) The initial counseling must—
(i) Explain the terms and conditions
of the TEACH Grant agreement to serve
as described in § 686.12;
(ii) Provide the student with
information about how to identify lowincome schools and documented highneed fields;
(iii) Inform the grant recipient that, in
order for the teaching to count towards
the recipient’s service obligation, the
high-need field in which he or she has
prepared to teach must be—
(A) One of the six high-need fields
listed in § 686.2; or
(B) A high-need field listed in the
Nationwide List at the time and for the
State in which the grant recipient begins
teaching in that field.
(iv) Inform the grant recipient of the
opportunity to request a suspension of
the eight-year period for completion of
the agreement to serve and the
conditions under which a suspension
may be granted in accordance with
§ 686.41;
(v) Explain to the student that
conditions, such as conviction of a

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felony, could preclude the student from
completing the service obligation;
(vi) Emphasize to the student that if
the student fails or refuses to complete
the service obligation contained in the
agreement to serve or any other
condition of the agreement to serve—
(A) The TEACH Grant must be repaid
as a Federal Direct Unsubsidized Loan;
and
(B) The TEACH Grant recipient will
be obligated to repay the full amount of
each grant and the accrued interest from
each disbursement date;
(vii) Explain the circumstances, as
described in § 686.43, under which a
TEACH Grant will be converted to a
Federal Direct Unsubsidized Loan;
(viii) Emphasize that, once a TEACH
Grant is converted to a Federal Direct
Unsubsidized Loan, it cannot be
reconverted to a grant;
(ix) Review for the grant recipient
information on the availability of the
Department’s Student Loan
Ombudsman’s office;
(x) Describe the likely consequences
of loan default, including adverse credit
reports, garnishment of wages, Federal
offset, and litigation; and
(xi) Inform the student of sample
monthly repayment amounts based on a
range of student loan indebtedness.
(b) Subsequent counseling. (1) If a
student receives more than one TEACH
Grant, the institution must ensure that
the student receives additional
counseling prior to the first
disbursement of each subsequent
TEACH Grant award.
(2) Subsequent counseling may be in
person, by audiovisual presentation, or
by interactive electronic means. In each
case, the institution must ensure that an
individual with expertise in title IV,
HEA programs is reasonably available
shortly after the counseling to answer
the student’s questions. As an
alternative, in the case of a student
enrolled in a correspondence program of
study or a study-abroad program of
study approved for credit at the home
institution, the student may be provided
with written counseling materials before
the grant is disbursed.
(3) Subsequent counseling must—
(i) Review the terms and conditions of
the TEACH Grant agreement to serve as
described in § 686.12;
(ii) Emphasize to the student that if
the student fails or refuses to complete
the service obligation contained in the
agreement to serve or any other
condition of the agreement to serve—
(A) The TEACH Grant must be repaid
as a Federal Direct Unsubsidized Loan;
and
(B) The TEACH Grant recipient will
be obligated to repay the full amount of

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Jkt 214001

the grant and the accrued interest from
the disbursement date;
(iii) Explain the circumstances, as
described in § 686.34, under which a
TEACH Grant will be converted to a
Federal Direct Unsubsidized Loan;
(iv) Emphasize that, once a TEACH
Grant is converted to a Federal Direct
Unsubsidized Loan, it cannot be
reconverted to a grant; and
(v) Review for the grant recipient
information on the availability of the
Department’s Student Loan
Ombudsman’s office.
(c) Exit counseling. (1) An institution
must ensure that exit counseling is
conducted with each grant recipient
before he or she ceases to attend the
institution at a time determined by the
institution.
(2) The exit counseling must be in
person, by audiovisual presentation, or
by interactive electronic means. In each
case, the institution must ensure that an
individual with expertise in title IV,
HEA programs is reasonably available
shortly after the counseling to answer
the grant recipient’s questions. As an
alternative, in the case of a grant
recipient enrolled in a correspondence
program of study or a study-abroad
program of study approved for credit at
the home institution, the grant recipient
may be provided with written
counseling materials within 30 days
after he or she completes the TEACH
Grant-eligible program.
(3) Within 30 days of learning that a
grant recipient has withdrawn from the
institution without the institution’s
knowledge, or from a TEACH Granteligible program, or failed to complete
exit counseling as required, exit
counseling must be provided either inperson, through interactive electronic
means, or by mailing written counseling
materials to the grant recipient’s last
known address.
(4) The exit counseling must—
(i) Inform the grant recipient of the
four-year service obligation that must be
completed within the first eight
calendar years after completing a
TEACH Grant-eligible program in
accordance with § 686.12;
(ii) Inform the grant recipient of the
opportunity to request a suspension of
the eight-year period for completion of
the service obligation and the
conditions under which a suspension
may be granted in accordance with
§ 686.41;
(iii) Provide the grant recipient with
information about how to identify lowincome schools and documented highneed fields;
(iv) Inform the grant recipient that, in
order for the teaching to count towards
the recipient’s service obligation, the

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high-need field in which he or she has
prepared to teach must be—
(A) One of the six high-need fields
listed in § 686.2; or
(B) A high-need field listed in the
Nationwide List at the time and for the
State in which the grant recipient begins
teaching in that field.
(v) Explain that the grant recipient
will be required to submit to the
Secretary each year written
documentation of his or her status as a
highly-qualified teacher in a high-need
field at a low-income school or of his or
her intent to complete the four-year
service obligation until the date that the
service obligation has been met or the
date that the grant becomes a Federal
Direct Unsubsidized Loan, whichever
occurs first;
(vi) Explain the circumstances, as
described in § 686.43, under which a
TEACH Grant will be converted to a
Federal Direct Unsubsidized Loan;
(vii) Emphasize that once a TEACH
Grant is converted to a Federal Direct
Unsubsidized Loan it cannot be
reconverted to a grant;
(viii) Inform the grant recipient of the
average anticipated monthly repayment
amount based on a range of student loan
indebtedness if the TEACH Grants
convert to a Federal Direct
Unsubsidized Loan;
(ix) Review for the grant recipient
available repayment options if the
TEACH Grant converts to a Federal
Direct Unsubsidized Loan, including the
standard repayment, extended
repayment, graduated repayment,
income-contingent and income-based
repayment plans, and loan
consolidation;
(x) Suggest debt-management
strategies to the grant recipient that
would facilitate repayment if the
TEACH Grant converts to a Federal
Direct Unsubsidized Loan;
(xi) Explain to the grant recipient how
to contact the Secretary;
(xii) Describe the likely consequences
of loan default, including adverse credit
reports, garnishment of wages, Federal
offset, and litigation;
(xiii) Review for the grant recipient
the conditions under which he or she
may defer or forbear repayment, obtain
a full or partial discharge, or receive
teacher loan forgiveness if the TEACH
Grant converts to a Federal Direct
Unsubsidized Loan;
(xiv) Review for the grant recipient
information on the availability of the
Department’s Student Loan
Ombudsman’s office; and
(xv) Inform the grant recipient of the
availability of title IV loan information
in the National Student Loan Data
System (NSLDS).

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(5) If exit counseling is conducted
through interactive electronic means, an
institution must take reasonable steps to
ensure that each grant recipient receives
the counseling materials and
participates in and completes the exit
counseling.
(d) Compliance. The institution must
maintain documentation substantiating
the institution’s compliance with this
section for each TEACH Grant recipient.
(Authority: 20 U.S.C. 1070g, et seq. )
§ 686.33

Frequency of payment.

(a) In each payment period, an
institution may pay a student at such
times and in such installments as it
determines will best meet the student’s
needs.
(b) The institution may pay funds in
one lump sum for all the prior payment
periods for which the student was
eligible under § 686.11 within the award
year as long as the student has signed
the agreement to serve prior to
disbursement of the TEACH Grant. The
student’s enrollment status must be
determined according to work already
completed.
(Authority: 20 U.S.C. 1070g, et seq. )

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§ 686.34 Liability for and recovery of
TEACH Grant overpayments.

(a)(1) Except as provided in
paragraphs (a)(2) and (3) of this section,
a student is liable for any TEACH Grant
overpayment made to him or her.
(2) The institution is liable for a
TEACH Grant overpayment if the
overpayment occurred because the
institution failed to follow the
procedures set forth in this part or in 34
CFR part 668. The institution must
restore an amount equal to the
overpayment to its TEACH Grant
account.
(3) A student is not liable for, and the
institution is not required to attempt
recovery of or refer to the Secretary, a
TEACH Grant overpayment if the
amount of the overpayment is less than
$25 and is not a remaining balance.
(b)(1) Except as provided in paragraph
(a)(3) of this section, if an institution
makes a TEACH Grant overpayment for
which it is not liable, it must promptly
send a written notice to the student
requesting repayment of the
overpayment amount. The notice must
state that failure to make the requested
repayment, or to make arrangements
satisfactory to the holder of the
overpayment debt to repay the
overpayment, makes the student
ineligible for further title IV, HEA
program funds until final resolution of
the TEACH Grant overpayment.
(2) If a student objects to the
institution’s TEACH Grant overpayment

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determination, the institution must
consider any information provided by
the student and determine whether the
objection is warranted.
(c) Except as provided in paragraph
(a)(3) of this section, if the student fails
to repay a TEACH Grant overpayment or
make arrangements satisfactory to the
holder of the overpayment debt to repay
the TEACH Grant overpayment, after the
institution has taken the action required
by paragraph (b) of this section, the
institution must refer the overpayment
to the Secretary for collection in
accordance with procedures required by
the Secretary. After referring the TEACH
Grant overpayment to the Secretary
under this section, the institution need
make no further efforts to recover the
overpayment.
(Authority: 20 U.S.C. 1070g, et seq. )
§ 686.35 Recalculation of TEACH Grant
award amounts.

(a) Change in enrollment status. (1) If
the student’s enrollment status changes
from one academic term to another
academic term within the same award
year, the institution must recalculate the
TEACH Grant award for the new
payment period taking into account any
changes in the cost of attendance.
(2)(i) If the student’s projected
enrollment status changes during a
payment period after the student has
begun attendance in all of his or her
classes for that payment period, the
institution may (but is not required to)
establish a policy under which the
student’s award for the payment period
is recalculated. Any such recalculations
must take into account any changes in
the cost of attendance. In the case of an
undergraduate or post-baccalaureate
program of study, if such a policy is
established, it must be the same policy
that the institution established under 34
CFR 690.80(b) for the Federal Pell Grant
Program and it must apply to all
students in the TEACH Grant-eligible
program.
(ii) If a student’s projected enrollment
status changes during a payment period
before the student begins attendance in
all of his or her classes for that payment
period, the institution must recalculate
the student’s enrollment status to reflect
only those classes for which he or she
actually began attendance.
(b) Change in cost of attendance. If
the student’s cost of attendance changes
at any time during the award year and
his or her enrollment status remains the
same, the institution may, but is not
required to, establish a policy under
which the student’s TEACH Grant
award for the payment period is
recalculated. If such a policy is

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35505

established, it must apply to all students
in the TEACH Grant-eligible program.
(Authority: 20 U.S.C. 1070g, et seq. )
§ 686.36 Fiscal control and fund
accounting procedures.

(a) An institution must follow the
provisions for maintaining general fiscal
records in this section and in 34 CFR
668.24(b).
(b) An institution must maintain
funds received under this section in
accordance with the requirements in 34
CFR 668.164.
(Authority: 20 U.S.C. 1070g, et seq. )
§ 686.37 Institutional reporting
requirements.

(a) An institution must provide to the
Secretary information about each
TEACH Grant recipient that includes
but is not limited to—
(1) The student’s eligibility for a
TEACH Grant, as determined in
accordance with §§ 686.11 and 686.31;
(2) The student’s TEACH Grant
amounts; and
(3) The anticipated and actual
disbursement date or dates and
disbursement amounts of the TEACH
Grant funds.
(b) An institution must submit the
initial disbursement record for a TEACH
Grant to the Secretary no later than 30
days following the date of the initial
disbursement. The institution must
submit subsequent disbursement
records, including adjustment and
cancellation records, to the Secretary no
later than 30 days following the date the
disbursement, adjustment, or
cancellation is made.
(Authority: 20 U.S.C. 1070g, et seq. )
§ 686.38 Maintenance and retention of
records.

(a) An institution must follow the
record retention and examination
provisions in this part and in 34 CFR
668.24.
(b) For any disputed expenditures in
any award year for which the institution
cannot provide records, the Secretary
determines the final authorized level of
expenditures.
(Authority: 20 U.S.C. 1070g, et seq.)

Subpart E—Service and Repayment
Obligations
§ 686.40 Documenting the service
obligation.

(a) Except as provided in §§ 686.41
and 686.42, within 120 days of
completing or otherwise ceasing
enrollment in a program of study for
which a TEACH Grant was received, the
grant recipient must confirm to the
Secretary in writing that—

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(1) He or she is employed as a fulltime teacher in accordance with the
terms and conditions of the agreement
to serve described in § 686.12; or
(2) He or she is not yet employed as
a full-time teacher but intends to meet
the terms and conditions of the
agreement to serve described in
§ 686.12.
(b) If a grant recipient is performing
full-time teaching service in accordance
with the agreement to serve, or
agreements to serve if more than one
agreement exists, the grant recipient
must, upon completion of each of the
four required elementary or secondary
academic years of teaching service,
provide to the Secretary documentation
of that teaching service on a form
approved by the Secretary and certified
by the chief administrative officer of the
school in which the grant recipient is
teaching. The documentation must
show that the grant recipient is teaching
in a low-income school. If the school at
which the grant recipient is employed
meets the requirements of a low-income
school in the first year of the grant
recipient’s four elementary or secondary
academic years of teaching and the
school fails to meet those requirements
in subsequent years, those subsequent
years of teaching qualify for purposes of
this section for that recipient.
(c)(1) In addition to the
documentation requirements in
paragraph (b) of this section, the
documentation must show that the grant
recipient—
(i) Taught a majority of classes during
the period being certified in any of the
high-need fields of mathematics,
science, a foreign language, bilingual
education, English language acquisition,
special education, or as a reading
specialist; or
(ii) Taught a majority of classes during
the period being certified in a State in
another high-need field designated by
that State and listed in the Nationwide
List, except that teaching service does
not satisfy the requirements of the
agreement to serve if that teaching
service is in a geographic region of a
State or in a specific grade level not
associated with a high-need field of a
State designated in the Nationwide List
as having a shortage of elementary or
secondary school teachers.
(2) If a grant recipient begins qualified
full-time teaching service in a State in
a high-need field designated by that
State and listed in the Nationwide List
and in subsequent years that high-need
field is no longer designated by the State
in the Nationwide List, the grant
recipient will be considered to continue
to perform qualified full-time teaching
service in a high-need field of that State

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and to continue to fulfill the service
obligation.
(d) Documentation must also provide
evidence that the grant recipient is a
highly-qualified teacher.
(e) For purposes of completing the
service obligation, the elementary or
secondary academic year may be
counted as one of the grant recipient’s
four complete elementary or secondary
academic years if the grant recipient
completes at least one-half of the
elementary or secondary academic year
and the grant recipient’s school
employer considers the grant recipient
to have fulfilled his or her contract
requirements for the elementary or
secondary academic year for the
purposes of salary increases, tenure, and
retirement if the grant recipient is
unable to complete an elementary or
secondary academic year due to—
(1) A condition that is a qualifying
reason for leave under the Family and
Medical Leave Act of 1993 (FMLA) (29
U.S.C. 2612(a)(1) and (3)); or
(2) A call or order to active duty status
for more than 30 days as a member of
a reserve component of the Armed
Forces named in 10 U.S.C. 10101, or
service as a member of the National
Guard on full-time National Guard duty,
as defined in 10 U.S.C. 101(d)(5), under
a call to active service in connection
with a war, military operation, or a
national emergency.
(f) A grant recipient who taught in
more than one qualifying school during
an elementary or secondary academic
year and demonstrates that the
combined teaching service was the
equivalent of full-time, as supported by
the certification of one or more of the
chief administrative officers of the
schools involved, is considered to have
completed one elementary or secondary
academic year of qualifying teaching.
(Authority: 20 U.S.C. 1070g, et seq. )
§ 686.41

Periods of suspension.

(a)(1) A grant recipient who has
completed or who has otherwise ceased
enrollment in a TEACH Grant-eligible
program for which he or she received
TEACH Grant funds may request a
suspension from the Secretary of the
eight-year period for completion of the
service obligation based on—
(i) Enrollment in a program of study
for which the recipient would be
eligible for a TEACH Grant or in a
program of study that has been
determined by a State to satisfy the
requirements for certification or
licensure to teach in the State’s
elementary or secondary schools;
(ii) A condition that is a qualifying
reason for leave under the FMLA; or

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(iii) A call or order to active duty
status for more than 30 days as a
member of a reserve component of the
Armed Forces named in 10 U.S.C.
10101, or service as a member of the
National Guard on full-time National
Guard duty, as defined in 10 U.S.C.
101(d)(5), under a call to active service
in connection with a war, military
operation, or a national emergency.
(2) A grant recipient may receive a
suspension described in paragraphs
(a)(1)(i) and (ii) of this section in oneyear increments that—
(i) Does not exceed a combined total
of three years under both paragraphs
(a)(1)(i) and (ii) of this section; or
(ii) Ends upon the completion of the
military service in paragraph (a)(1)(iii)
of this section.
(b) A grant recipient must apply for a
suspension in writing on a form
approved by the Secretary prior to being
subject to any of the conditions under
§ 686.43(a)(1) through (a)(5) that would
cause the TEACH Grant to convert to a
Federal Direct Unsubsidized Loan.
(c) A grant recipient must provide the
Secretary with documentation
supporting the suspension request as
well as current contact information
including home address and telephone
number.
(Authority: 20 U.S.C. 1070g, et seq. )
§ 686.42

Discharge of agreement to serve.

(a) Death. If a grant recipient dies, the
Secretary discharges the obligation to
complete the agreement to serve based
on an original or certified copy of the
grant recipient’s death certificate, an
accurate and complete photocopy of the
original or certified copy of the grant
recipient’s death certificate, or, on a
case-by-case basis, reliable
documentation acceptable to the
Secretary.
(b) Total and permanent disability. (1)
A grant recipient’s agreement to serve is
discharged if the recipient becomes
totally and permanently disabled, as
defined in 34 CFR 682.200(b), and the
grant recipient applies for and satisfies
the eligibility requirements for a total
and permanent disability discharge in
accordance with 34 CFR 685.213.
(2) The eight-year time period in
which the grant recipient must complete
the service obligation remains in effect
during the conditional discharge period
described in 34 CFR 685.213(c)(2)
unless the grant recipient is eligible for
a suspension based on a condition that
is a qualifying reason for leave under
the FMLA in accordance with
§ 686.41(a)(1)(ii)(D).
(3) Interest continues to accrue on
each TEACH Grant disbursement unless

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and until the TEACH Grant recipient’s
agreement to serve is discharged.
(4) If the grant recipient satisfies the
criteria for a total and permanent
disability discharge during and at the
end of the three-year conditional
discharge period, the Secretary
discharges the grant recipient’s service
obligation.
(5) If, at any time during or at the end
of the three-year conditional discharge
period, the Secretary determines that
the grant recipient does not meet the
eligibility criteria for a total and
permanent disability discharge, the
Secretary ends the conditional discharge
period and the grant recipient is once
again subject to the terms of the
agreement to serve.
(Authority: 20 U.S.C. 1070g, et seq. )
§ 686.43

Obligation to repay the grant.

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(a) The TEACH Grant amounts
disbursed to the recipient will be
converted into a Federal Direct
Unsubsidized Loan, with interest
accruing from the date that each grant
disbursement was made and be
collected by the Secretary in accordance
with the relevant provisions of subpart
A of 34 CFR part 685 if—
(1) The grant recipient, regardless of
enrollment status, requests that the
TEACH Grant be converted into a
Federal Direct Unsubsidized Loan
because he or she has decided not to

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teach in a qualified school or field or for
any other reason;
(2) Within 120 days of ceasing
enrollment in the institution prior to
completing the TEACH Grant-eligible
program, the grant recipient has failed
to notify the Secretary in accordance
with § 686.40(a);
(3) Within one year of ceasing
enrollment in the institution prior to
completing the TEACH Grant-eligible
program, the grant recipient has not—
(i) Been determined eligible for a
suspension of the eight-year period for
completion of the service obligation as
provided in § 686.41;
(ii) Re-enrolled in a TEACH Granteligible program; or
(iii) Begun creditable teaching service
as described in § 686.12(b);
(4) The grant recipient completes the
course of study for which a TEACH
Grant was received and does not
actively confirm to the Secretary, at
least annually, his or her intention to
satisfy the agreement to serve; or
(5) The grant recipient has completed
the TEACH Grant-eligible program but
has failed to begin or maintain qualified
employment within the timeframe that
would allow that individual to complete
the service obligation within the
number of years required under
§ 686.12.
(b) A TEACH Grant that converts to a
loan, and is treated as a Federal Direct
Unsubsidized Loan, is not counted

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35507

against the grant recipient’s annual or
any aggregate Stafford Loan limits.
(c) A grant recipient whose TEACH
Grant has been converted to a Federal
Direct Unsubsidized Loan—
(1) Enters a six-month grace period
prior to entering repayment, and
(2) Is eligible for all of the benefits of
the Direct Loan Program, including an
in-school deferment.
(d) A TEACH Grant that is converted
to a Federal Direct Unsubsidized Loan
cannot be reconverted to a grant.
(Authority: 20 U.S.C. 1070g, et seq. )

PART 690—FEDERAL PELL GRANT
PROGRAM
42. The authority citation for part 690
is revised to read as follows:

■

Authority: 20 U.S.C. 1070a, 1070g, unless
otherwise noted.

43. Section 690.2 is amended by:
A. In paragraph (b), adding, in
alphabetical order, the terms ‘‘Teacher
Education Assistance for College and
Higher Education (TEACH) Grant
Program’’ and ‘‘TEACH Grant’’.
■ B. Revising the authority citation to
read as follows:
■
■

§ 690.2

*

*

Definitions.

*

*

*

(Authority: 20 U.S.C. 1070a, 1070g)
[FR Doc. E8–13587 Filed 6–20–08; 8:45 am]
BILLING CODE 4000–01–P

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