10.28.16

At Sen. Murray’s Recommendation, Dept. of Education to Restore Pell Grant Eligibility to Thousands of Students Impacted by Closed Schools

 

Dept. of Education to apply new legal interpretation to provision in Higher Education Act (HEA)—identified by Murray—to restore Pell Grant eligibility to students impacted by closures of Corinthian Colleges, ITT Tech, and other closed schools: LINK

 

Many students who used Pell Grants to attend now-closed schools have exhausted their eligibility and are ineligible for further support

 

Faced with inaction on this issue, Murray worked to identify HEA provision that already provided Dept. of Education existing authority to restore Pell Grant eligibility to these students: LINK

 

Dept. of Education to apply Murray recommendation without delay—over 50,000 students stand to benefit and countless moving forward   

 

(Washington, D.C) – Today, Senator Patty Murray (D-WA), Ranking Member of the Senate Health, Education, Labor, and Pensions (HELP) Committee, announced that the U.S. Department of Education (“the Department”) has agreed to follow her recommendation and recognize its existing authority under a provision of the Higher Education Act (HEA) to restore Pell Grant eligibility to over 50,000 students enrolled at the time Corinthian Colleges and ITT Technical Institute (“ITT Tech”) abruptly closed, as well as countless other students that were unable to complete their programs at schools that have shut down. The Department will begin working immediately to restore Pell Grant eligibility to students for the period of time they attended colleges or career schools that have closed down. This successful recommendation by Murray is a huge step forward in efforts to provide relief to students impacted—and, in many cases, victimized—by closed schools. The Department indicates the change will benefit at least “several thousand students immediately” who had already met or were on the verge of reaching their lifetime limit, many more students who have not reached their limits but who will be able to go back to school with additional grant eligibility, and a great number of students whose schools might close in the future.

 

Currently, student borrowers can receive a discharge of their loans following an abrupt closure of their school and also have their eligibility to continue borrowing restored. However, students who used Pell Grants to attend a failed school are not provided a similar restoration of eligibility. Because students can only receive Pell Grants for a total of six years, or 12 full-time semesters, far too many students have been unable to pursue an education at a new school.

 

The Department previously said that it did not have the authority to restore any of these semesters of Pell Grant eligibility when a school closes. A number of Senate Democrats introduced legislation, the Pell Restoration Act, which would have explicitly given these students the ability to obtain new Pell Grant eligibility to attend another school. Facing inaction on this issue, Murray, a Pell Grant recipient herself, sent a letter to Secretary John King on October 5, 2016, identifying existing legal authority by the Department to allow students to access additional Pell Grants under a provision in the HEA that governs students’ eligibility for additional federal student aid when their school closes.

 

This is such great news for students who have faced an abrupt closure of their school,” Senator Murray said. As someone who was only able to go to college myself because of the federal support that is now called Pell Grants, I know firsthand how much of a difference this will make for students in my home state of Washington and across the country who are working hard and scrambling to continue their education at a new school.”

 

“Following receipt of your letter, the Department analyzed Section 437(c)(3) of the HEA,” wrote Under Secretary of Education Ted Mitchell in response to Senator Murray’s letter. “As a result of our analysis, we will restore Pell Grant eligibility to students who were unable to complete a course of study due to the closing of an institution. This policy is expected to benefit several thousand students immediately who were at or near their lifetime limit, as well as more students whose institutions might close moving forward, and those who hadn’t reached their limits but who will be able to go back to school if they choose.”  

 

“Restoring Pell eligibility for students whose schools closed ensures they truly get a fresh start. This change extends much needed opportunities for our most vulnerable students. We are heartened to see the Department act on the flexibility uncovered by Ranking Member Murray, among others.”—Ben Miller, Center for American Progress (CAP)

 

Read full response by the Department HERE.

 

Background on HEA provision: 

 

The provision under the HEA that grants authority to restore Pell Grant eligibility was inserted from the 1992 amendments to the law and reads as follows:

 

Sec. 437: “(3) ELIGIBILITY FOR ADDITIONAL ASSISTANCE.—The period of a student’s attendance at an institution at which the student was unable to complete a course of study due to the closing of the institution shall not be considered for purposes of calculating the student’s period of eligibility for additional assistance under this title.

 

The title referenced in this provision refers to all of title IV, which governs all federal student loans and the majority of grants to students, including the Pell Grant program.

 

Further efforts by Senator Murray to protect students in higher education:

 

Today’s announcement follows a series of requests by Senate Democrats, led by Senator Murray, to strengthen support for students and accountability for colleges using the Administration’s authority under the HEA. Senate Democrats’ efforts to improve college accountability began in April with a push to hold college accreditors accountable, and the Department took steps toward that goal when it issued a final recommendation to terminate the recognition of the Accrediting Council for Independent Colleges and Schools (ACICS). In June, Senate Democrats called for action to protect servicemembers and veterans through a strengthened 90/10 rule. And in July, Senate Democrats sent a letter to the U.S. Department of Veterans Affairs (VA) calling for strengthened “oversight, enforcement, and accountability” of colleges receiving Post-9/11 GI Bill benefits. Most recently, Senator Murray led her colleagues in calling for additional relief and guidance for former ITT Tech students.

 

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