[Federal Register: November 5, 1999 (Volume 64, Number 214)]
[Proposed Rules]
[Page 60631-60646]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr05no99-30]

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Part IV

Department of Education

_______________________________________________________________________

34 CFR Part 611

Teacher Quality Enhancement Grants Program; Proposed Rule

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DEPARTMENT OF EDUCATION

34 CFR Part 611

RIN: 1840-AC65


Teacher Quality Enhancement Grants Program

AGENCY: Office of Postsecondary Education, Department of Education.

ACTION: Notice of proposed rulemaking.

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SUMMARY: The Acting Assistant Secretary for Postsecondary Education
proposes regulations that would implement a requirement of section
204(e) of the Higher Education Act (HEA), as amended by the Higher
Education Amendments of 1998. Section 204(a) requires that students in
teacher preparation programs funded under the Teacher Recruitment
Program must repay scholarships provided with program funds if they do
not teach in high-need local educational agencies for the period of
time for which they receive scholarship assistance. These proposed
regulations also would extend the provisions implementing section
204(e) to any scholarships awarded to students in teacher preparation
programs funded under the State and Partnership Programs authorized in
sections 202 and 203 of the HEA.

DATES: We must receive your comments on or before December 6, 1999.

ADDRESSEES: All comments concerning these proposed regulations should
be addressed to: Dr. Louis Venuto, Office of Policy, Planning, and
Innovation, Office of Postsecondary Education, 400 Maryland Ave. SW,
Washington, DC 20202-5131: Telephone: (202) 708-8847, or by FAX to:
(202) 260-9272. If you prefer to send your comments through the
Internet use the following address: comments@ed.gov
    You must include the term ``Scholarship Repayment'' in the subject
line of your electronic message.

FOR FURTHER INFORMATION CONTACT: Dr. Louis Venuto, Higher Education
Programs, Office of Postsecondary Education, Office of Policy,
Planning, and Innovation, 400 Maryland Avenue, SW, Washington, DC
20202-5131: Telephone: (202) 708-8847. Inquiries also may be sent by e-
mail to: Louis__Venuto@ed.gov or by FAX to: (202) 260-9272. If you use
a telecommunications device for the deaf (TDD), you may call the
Federal Information Relay Service (FIRS) at 1-800-877-8339.
    Individuals with disabilities may obtain this document in an
alternate format (e.g., Braille, large print, audiotape, or computer
diskette) on request to the contact person listed in the preceding
paragraph.

SUPPLEMENTARY INFORMATION:

Invitation to Comment

    We invite you to submit comments regarding these proposed
regulations.
    We invite you to assist us in complying with the specific
requirements of Executive Order 12866 and its overall requirement of
reducing regulatory burden that might result from these proposed
regulations. Please let us know of any further opportunities we should
take to reduce potential costs or increase potential benefits while
preserving the effective and efficient administration of the program.
    During and after the comment period, you may inspect all public
comments about these proposed regulations in the Department of
Education, Teacher Quality Program Office, 1990 K Street NW, 6th floor,
Washington, DC. Comments are available for inspection between the hours
of 8:30 a.m. and 4 p.m., Eastern time, Monday through Friday of each
week except Federal holidays.

Assistance to Individuals With Disabilities in Reviewing the
Rulemaking Record

    On request, we will supply an appropriate aid, such as a reader or
print magnifier, to an individual with a disability who needs
assistance to review the comments or other documents in the public
rulemaking record for these proposed regulations. If you want to
schedule an appointment for this type of aid, you may call (202) 205-
8113 or (202) 260-9895. If you use a TDD, you may call the Federal
Information Relay Service (FIRS) at 1-800-877-8339.

General

Background

    On October 8, 1998, the President signed into law the Higher
Education Amendments of 1998 (Pub. L. 105-244). Title II of this law
addresses the Nation's need to ensure that new teachers enter the
classroom prepared to teach all students to high standards by
authorizing, as Title II of the Higher Education Act (HEA), Teacher
Quality Enhancement Grants for States and Partnerships. The new Teacher
Quality Enhancement Grants Program provides an historic opportunity to
effect positive change in the recruitment, preparation, licensing, and
on-going support of teachers in America.
    The new Teacher Quality Enhancement Grants Program consists of
three different competitive grant programs: (1) The State Grants
Program, which is designed to help States promote a broad array of
improvements in teacher licensure, certification, preparation, and
recruitment; (2) The Partnership Grants for Improving Teacher
Preparation Program, which is designed to have schools of education,
schools of arts and sciences, high-need local educational agencies
(LEAs), and others work together to ensure that new teachers have the
content knowledge and skills their students need of them when they
enter the classroom; and (3) The Teacher Recruitment Program, which is
designed to help schools and school districts with severe teacher
shortages to secure the high-quality teachers that they need. Together,
these programs are designed to increase student achievement by
supporting comprehensive approaches to improving teacher quality.
    In particular, the Teacher Recruitment Grants Program is designed
to address a significant national need for recruiting, preparing, and
hiring more individuals to become highly qualified teachers, especially
in high-poverty communities. The Teacher Recruitment Grants--awarded
either to States or to partnerships among high-need LEAs, teacher
preparation institutions, and schools of arts and sciences--are
designed to reduce shortages of highly qualified teachers in high-need
school districts. In this regard, local partnerships between school
districts and teacher preparation institutions have been found to be
very effective at providing teachers for communities where they are
most needed. The ``grow your own'' approach is also effective for these
communities because individuals who are already members of a community
are likely to remain there after they become teachers. The recruitment
grants will allow individual communities to determine their needs for
teachers and to recruit and prepare teachers who meet those needs.
States also can play an important role in ensuring that high-need
school districts are able to recruit highly qualified teachers, and can
use recruitment grants to develop and implement effective mechanisms
for doing so.
    One key aspect of the Teacher Recruitment Grants Program is the
availability of scholarships to students who are enrolled in teacher
preparation programs at the grantee institutions of higher education
(IHEs) (or at IHEs working with State Teacher Recruitment Program
grantees), and who agree to teach in high-need school districts. As
provided in section 204(e) of the HEA, in exchange for scholarship
support recipients must agree to incur a

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contractual obligation, under terms the Department establishes, to
teach in high-need LEAs for a period equivalent to the period for which
they receive the scholarship. This notice proposes the terms and
conditions of this contractual agreement.
    As explained more fully in this Notice of Proposed Rulemaking,
scholarship recipients who do not meet this teaching obligation would
have to repay the scholarship, accrued interest, and any costs of
collection. Providing the Department the information it needs to
determine when a recipient has met the service obligation and,
alternatively, when a recipient needs to repay these sums, would become
a shared responsibility of the institutions, scholarship recipients,
and the high-need LEAs in which they will teach. IHEs and States that
accept Teacher Recruitment Program grants would need to report to the
Department the information that identifies the scholarship recipients
and the amount of scholarships they receive. Students who receive
scholarships would have certain reporting responsibilities that would
begin upon graduation or withdrawal from the teacher training program
and extend until they had fulfilled the service obligation or had
repaid the scholarship, interest, and any costs of collection. Among
other things, they would assume responsibility for having LEAs in which
they teach after graduating from the teacher training programs provide
the Department with basic employment information to confirm that they
are fulfilling their service obligation.
    Sections 202((d)(7) and 203(e)(4) of the HEA expressly permit
recipients of State and Partnership grants to use program funds for
activities that are authorized under the Teacher Recruitment Program.
Hence, consistent with their approved applications, grantees of all
three Teacher Quality Enhancement Grant programs may use program funds
to provide scholarships to students attending teacher preparation
programs who agree, upon graduation, to teach in high-need school
districts. This Notice of Proposed Rulemaking would have the
requirements governing scholarships provided under the Teacher
Recruitment Program apply also to any scholarship provided under the
State and Partnership Programs.
    Finally, to receive scholarship assistance under any of the Teacher
Quality Enhancement Grant programs, students do not need to be eligible
for Federal student financial assistance provided under Title IV of the
HEA. However, section 471 of the HEA does require IHEs to include the
amount of any Teacher Quality Program scholarship as available
resources in determining the amount of student financial assistance
that a student may receive under Title IV.

Need To Regulate

    The Department announced the initial competition for grants under
the State, Partnership, and Teacher Recruitment Programs in a notice
published in the Federal Register on February 8, 1999 (64 FR 6139). The
Department announced grant awards under the State and Teacher
Recruitment Programs on July 28, 1999, and grant awards under the
Partnership Program on September 7, 1999.
    The need for these regulations is clear. Section 204(e) of the HEA
directs the Secretary to establish requirements to ensure that
recipients of scholarships provided under this program either teach,
upon graduation, in a high-need LEA for a period equivalent to the
period for which they received scholarship assistance, or repay the
amount of the scholarships. Use of program funds for these scholarships
is a centerpiece of the Teacher Recruitment Program strategy for
addressing teacher shortages in high-need areas. Hence, without these
regulations, recipients of Teacher Recruitment Program grants will lack
the capacity to implement a financial incentive that is a key aspect of
the program. Likewise, recipients of State and Partnership grants will
be unable to implement key activities that depend upon the use of
program funds for scholarships to those attending teacher preparation
programs.
    The February 8, 1999 Notice of Eligibility and Selection Criteria
to govern the initial competitions under the three Teacher Quality
Programs established a definition of ``high-need LEA'' (64 FR 6145).
That notice also requires States and partnerships that receive initial
Teacher Recruitment Program grant awards to work to place those
receiving scholarships through this program in teaching positions in
high-need schools of high-need LEAs (64 FR 6145). However, the February
8 notice did not establish (1) The terms and conditions that will
govern the receipt of this scholarship assistance; (2) A specific
requirement that scholarship recipients agree to teach in high-need
schools of high-need LEAs as a condition of receiving scholarship
assistance; (3) The applicability of these provisions to scholarships
provided under the State, Partnership, or Teacher Recruitment Program;
or (4) The responsibilities of the scholarship recipients, teacher
preparation programs in which they are enrolled, and the LEAs in which
they later teach, to provide information to the Department that it
needs to properly administer the scholarship program.
    Therefore, regulations now are needed to establish requirements for
scholarships under the Teacher Recruitment Program in areas such as--
    * Whether all those provided scholarships with Teacher
Recruitment Program funds should have to meet their service obligations
by teaching in high-need schools of high-need LEAs;
    * The definition of a ``high-need LEA'' and a ``high-need
school'' in which scholarship recipients would need to teach in order
to avoid responsibility for repaying their scholarships;

    * How, in order to retain the financial assistance as a
scholarship, the Department will calculate the period of time in which
the scholarship recipient must teach in a high-need school of a high-
need LEA;
    * Conditions under which the Department may defer a
scholarship recipient's service obligation;
    * The amount of the scholarship recipient's indebtedness to
the Federal government for failure to meet the service obligation,
terms of repayment, and any limited circumstances under which the
Department would discharge this indebtedness;
    * The content of the scholarship agreement that the
scholarship recipient would execute;
    * The respective responsibilities of the scholarship
recipient, teacher preparation program in which the recipient is
enrolled, and the LEA in which he or she is later employed, to provide
periodically to the Department basic employment and other information
on the recipient until the Department has determined that the recipient
has fulfilled the service obligation or has repaid the scholarship,
interest, and any costs of collection; and
    * Whether the rules governing the receipt of scholarships
provided under the Teacher Recruitment Program should also apply to the
receipt of scholarships that grantees provide under the State and
Partnership Programs.
    In issuing these proposed regulations, we have sought to keep
administrative requirements and responsibilities that the public must
bear as simple as possible. For example, while scholarship recipients
are attending teacher preparation programs, grantees would only report
to the Department on their status at the beginning of each

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term. In addition, to confirm that scholarship recipients had met their
service obligations, the application packages for the Teacher
Recruitment Program available in February 1999 had proposed that
grantees assume some responsibility to track recipients once they had
graduated or withdrawn from the teacher training programs. Under these
proposed regulations grantees would not have these responsibilities.
They instead would shift to the scholarship recipients, the LEAs in
which they teach, and the Department. Moreover, these proposed
regulations and the scholarship agreement that would reflect them are
consistent with the basic terms and conditions of other Department
student financial assistance programs, such as the Federal Perkins Loan
Program authorized in Title IV, part E, of the HEA.
    The remainder of this section of this notice explains in more
detail the regulations that the Department proposes to adopt for the
Teacher Recruitment Program and, by extension, to the State and
Partnership Programs as well.

A. Definition of High-Need LEA and High-Need School

    Under these proposed regulations, individuals who are provided
scholarships with Teacher Recruitment Program funds would first need to
agree, upon graduation, to teach in a ``high-need school'' of a ``high-
need LEA'' for at least a period of time that is equivalent to the
period for which they received scholarship assistance. Proposed
Sec. 611.1, which includes definitions that would apply to the Teacher
Quality Enhancement Grants Program as a whole, defines those high-need
schools and high-need LEAs in which scholarship recipients must teach
to meet their service obligations. These definitions would apply both
to Fiscal Year 1999 funds that the Department awarded to States and
partnerships in July 1999 under the initial Teacher Recruitment Program
competition, and to funds that the Department will award under future
competitions.
    Under proposed Sec. 611.1, a high-need school would be an
elementary or secondary school that meets one of the following
definitions:
    1. A school that is located in an area in which 50 percent or more
of the enrolled students are eligible for free and reduced lunch
subsidies.
    2. A school that has--
    More than 34 percent of academic classroom teachers overall (across
all academic subjects) who do not have a major, minor, or significant
course work in their main assignment field; or
    More than 34 percent of the main assignment faculty in two of the
core-subject departments who do not have a major, minor, or significant
work in their main assigned field.
    Note: For purposes of the definition above--``Main assignment
field'' means the academic field in which teachers have the largest
percentage of their classes.
    ``Significant course work'' means four or more college-or
graduate-level courses in the content area.

    3. A school that has had an attrition rate among classroom teachers
of 15 percent or more in the last three school years.
    An LEA that serves at least one elementary or secondary school
meeting one of these three tests would be a ``high-need LEA.''
    As noted in the preceding section of this preamble, the February 8,
1999 rule governing the initial program competition (64 FR 6145)
requires all Teacher Recruitment Program grantees (and any high-need
LEAs that participate in their projects) to ensure that scholarship
recipients are placed, to the extent possible, in high-need schools
within the participating high-need LEAs. Consistent with this
requirement, the definitions in Sec. 611.1 of these proposed
regulations would clarify that these high-need schools are schools in
high-need LEAs that meet one or more of the three tests explained
immediately above. Section 611.34(a)(1) would clarify that, as a
condition of receiving scholarship assistance, a recipient must execute
a binding agreement either to teach in a high-need school in a high-
need LEA or repay the scholarship, interest, and any collection costs.
    These proposed definitions of high-need LEA and high-need school
differ in one respect from the definitions of these terms that we
included in the February 8, 1999 rules (64 FR 6147) to govern the
initial Teacher Quality program competitions. That notice provided that
the first eligibility test would depend upon the school's having at
least 40 percent of its enrolled students eligible for free lunch
subsidies. As now proposed, the test would instead be whether at least
50 percent of the school's enrolled students are eligible for free and
reduced lunch subsidies. The Department had adopted the former test
because it then believed that this measure was the closest available
proxy, for which LEAs would have data, for the definition of high-need
LEA in section 201(b)(2)(A) of the HEA. Section 201(b)(2)(A) extends
the definition of a high-need LEA to any LEA with at least one school
located in an area with a high percentage of individuals from families
with incomes below the poverty line.
    However, we have since determined that 40 percent eligibility of
enrolled students for free lunch subsidies is a measure that is
equivalent to nearly 50 percent eligibility of enrolled students for
free and reduced lunch subsidies. For several reasons, this 50-percent
test based on enrolled students eligible for free and reduced lunch
subsidies is preferable to the existing 40 percent test based on
eligibility for free lunch subsidies. First, this 50 percent
eligibility test is itself the same measure that Congress recognizes,
and most LEAs use, to determine a school's eligibility to operate as a
``schoolwide program''under Title I of the Elementary and Secondary
Education Act (ESEA). (See also the discussion of Title I schoolwide
programs and targeted assistance programs in the following section of
this notice.) Use of the 50-percent test here will promote a common
definition of ``high-poverty''in these two programs. Moreover, there is
a strong convergence between the purposes of the Teacher Quality
programs and the teaching needs of schools that are eligible to use
their Title I, ESEA funds in schoolwide programs.
    In particular, section 204 of the HEA requires states and
partnerships that receive Teacher Recruitment Program grants to work
collaboratively with specific high-need LEAs to recruit and train
individuals who, upon graduation from teacher preparation programs,
will help to address those LEAs' shortages of qualified teachers.
Consistent with this statutory requirement, proposed Sec. 611.40(d)
would require each grantee that provides scholarship assistance under
this program to work with high-need LEAs that participate in its
project so that scholarship recipients are placed, to the extent
possible, in high-need schools of those LEAs. Adapting the Title I,
ESEA, schoolwide program criterion to Title II of the HEA will
significantly reduce confusion among educators and scholarship
recipients alike about schools in which recipients may teach and
fulfill their service obligation.

B. Relationship of Service Obligation to Conditions for Debt
Forgiveness Under the Federal Perkins Loan Program

    Some Teacher Recruitment Program scholarship recipients also may be
recipients of student loans provided under the Federal Perkins Loan
Program. The Perkins Loan Program authorizes loan forgiveness for those
who subsequently teach in certain schools receiving funds provided
under

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Title I, part A, of the ESEA. Hence, the Perkins Loan Program and the
Title II, HEA, scholarship authority offer comparable incentives to
individuals to become teachers in high-need schools. However, the
incentives are not identical. We therefore believe that it would be
useful to clarify in what schools graduates of teacher preparation
programs who have received both forms of financial assistance must
teach in order both to secure Perkins Program loan forgiveness and to
meet their Teacher Recruitment Program service obligation.
    Regulations governing the Perkins Loan Program in 34 CFR 674.54
identify the conditions under which an institution of higher education
(IHE) providing a Federal Perkins loan must cancel up to 100 percent of
a student's outstanding loan balance. In particular, they require
cancellation of the loan for a student who teaches in a school that (1)
is in an LEA that is eligible to receive funds under Title I, part A,
of ESEA, and (2) the Secretary selects, based on a ranking of schools
in the State by the State educational agency and a determination that
more than 30 percent of the school's enrollment is comprised of Title I
students. If a Federal Perkins loan recipient also has received a
Teacher Recruitment Program scholarship, the individual will be able to
avoid payment of the Perkins loan and repayment of the scholarship if
the school has been designated for Perkins Program loan forgiveness and
is a high-need school within a high-need LEA.
    For the recipient, the key will be to confirm that the school is
one that meets tests under both the Perkins Loan Program and Teacher
Recruitment Program. The institution providing the Perkins loan will be
able to identify for the recipient which Title I schools qualify for
Perkins Program loan forgiveness. Then, through information obtained
either directly from the IHE or from the administrative office of the
LEA in which the scholarship recipient would teach, the recipient will
be able to learn whether the school also meets a Teacher Recruitment
Program definition of a high-need school. As the proposed regulations
announced in this notice would offer three alternative definitions of
high-need school, meeting any one of these three would suffice.
    However, we believe that scholarship recipients likely would find
it easiest to rely upon this proposed first definition--that a
particular school have at least 50 percent of its enrolled students
eligible for free and reduced lunch subsidies. This is because this
proposed definition has such programmatic importance under Title I of
the ESEA that all LEAs will know which of their schools receiving Title
I assistance meet this test.
    In particular, this particular proposed definition of high-need LEA
and high-need school is the same commonly used test of whether a school
receiving Title I assistance may, under section 1114 of the ESEA
operate as a schoolwide program. (Section 1114 of Title I provides that
schools may do so if 50 percent or more of their students are from low-
income families. Schools with lower percentages of students from low-
income families may not operate as schoolwide programs; they may only
operate as more traditional ``targeted-assistance schools.'' Title I
permits schools and LEAs to determine the percentage of students from
low-income families, among other ways, by using a variety of methods.
However, the eligibility of enrolled students for free and reduced
lunch subsidies is by far the most widely used.)
    Thus, any Title I school that (1) Has been designated by the
Secretary as one in which a teacher may receive Perkins Program loan
forgiveness, and (2) also is eligible to operate as a Title I
schoolwide program, would be one in which that teacher can meet the
service obligation. Conversely, teaching in a Title I school that the
Secretary designates under the Perkins Program, but which is not
eligible to operate as a schoolwide program, would only qualify the
teacher for Perkins Program loan forgiveness. It would not also enable
the teacher to satisfy his or her Teacher Recruitment Program's service
obligation unless the school met one of the other proposed definitions
of a high-need school--more than 34 percent of the school's teachers
teaching out-of-field, or a teacher attrition rate of at least 15
percent.

C. Terms of the Scholarships--General

    Proposed Sec. 611.34(a) provides that, before receiving scholarship
assistance under the Teacher Recruitment Program, individuals would
need to execute an agreement that embodies their service obligation.
Sections 611.35-611.39 of these proposed regulations contain recipient
repayment and informational requirements that would apply to these
scholarships. Section 611.34(b) would have the scholarship agreements
include these requirements, as the Secretary determines to be
necessary.

    Note: We have included a copy of the proposed scholarship
agreement in Appendix A to this notice. This proposed agreement
includes those provisions that, for scholarships provided with
Teacher Recruitment Program funds, program grantees would need to
include in scholarship agreements they offer to individuals
attending teacher preparation programs. The proposed agreement is
included in Appendix A for information purposes only; while its
terms reflect the content of the proposed regulations, the agreement
itself would not be included as a regulation in the Code of Federal
Regulations. Any written comment on the content of the proposed
Agreement should be sent to the person listed in the PAPERWORK
REDUCTION ACT OF 1995 section of this preamble. Any written comment
on the proposed regulations themselves, whose terms the scholarship
agreement would reflect, should be separately sent to the person
listed in the ADDRESSES section of this preamble.

    The provisions of proposed Secs. 611.35-611.39 concern matters such
as:
    * The responsibilities of the scholarship recipient to teach
in a high-need school of a high-need LEA once he or she is eligible to
teach;
    * How the period of time in which the scholarship recipient
must teach in a high-need school of a high-need LEA would be
determined;
    * Conditions under which the scholarship recipient's service
responsibility would be deferred;
    * The amount of the scholarship recipient's indebtedness to
the Federal government and terms of repayment, should the recipient not
meet these conditions; and
    * The responsibility of the scholarship recipient, either
alone or through the high-need LEA in which he or she begins teaching
after graduating from the teacher training program, periodically to
provide employment and other information to the Department.
    These provisions are similar to those used in other student
financial assistance programs that the Department administers. However,
given the relatively small size of the Teacher Recruitment Program,
these provisions have been tailored to provide as much flexibility and
as little administrative burden as possible.

D. The Service Obligation

    More specifically, before receiving a scholarship under the Teacher
Recruitment Program, an individual would need to sign an agreement both
to--
    * Begin to teach in a high-need school of a high-need LEA
(as those terms are defined in Sec. 611.1 of these proposed
regulations) within six months of the date from which he or she
completes a teacher training program, and
    * Continue to teach in a high-need school of a high-need LEA
for a period equivalent to at least the period of time

[[Page 60636]]

that the individual received the scholarship assistance;

or to--

    * Repay the Department the full amount of the scholarship
assistance, interest, and any costs of collection.
    Scholarship recipients who fail to complete the teacher preparation
program would be required to repay the full amount of scholarship
assistance that they receive, plus interest and any costs of
collection. (Proposed Sec. 611.40(a)(3) would require the IHE's teacher
training program to establish policies for determining when to withdraw
scholarship support for a student who does not remain in good academic
standing, and when to re-negotiate the scholarship package over an
extended period of time.)

E. Length of the Service Obligation

    Proposed Sec. 611.35 provides how the Secretary would calculate the
period of the scholarship recipient's service obligation. Whether
attending a teacher training program on a full- or part-time basis, a
scholarship recipient would need to teach in a high-need school of a
high-need LEA for a period that is comparable to the full-time
equivalent period of time that the student received scholarship
assistance. The Department would treat both the full academic year of
the teacher training program, excluding summer, and the full academic
year of the LEA, excluding summer and any intersession periods (for
LEAs that operate year-round programs), as equivalent one-year periods.

    Example: An individual receives a scholarship for the costs of
attending a teacher training program on a part-time basis. While the
program extends for two full years of coursework and clinical
experience, the scholarship recipient is enrolled part-time, and
completes the program in three years. The Secretary would consider
the period for which the individual receives a scholarship as two
academic years.
    Upon graduating (and receiving two full years of scholarship
support), the individual begins teaching half-time in a high-need
school of a high-need LEA. If the individual continues to teach
half-time, he or she would meet the program's service obligation by
teaching in a high-need school of a high-need LEA for the standard
contractual period of four school-years. This four-year period is
equivalent to the two full school-years that a full-time teacher
would teach.

    As explained below in part I, ``Recipient and LEA Reporting
Requirements,'' a Teacher Recruitment Program grantee would be required
to provide information to the Department that it needs to calculate the
period of a scholarship recipient's service obligation. Specifically,
the grantee would need to provide the Department the length of time for
which each recipient receives scholarship assistance converted to a
full-time student equivalent relative to students taking a normal, full
academic load. After graduating and beginning to teach, the scholarship
recipient would have the high-need LEA in which he or she teaches
provide the Department with comparable information on the recipient's
employment relative to those who teach for the LEA on a full-time
basis.

F. Repayment

    Proposed Sec. 611.36 contains provisions for repayment of the
scholarship for failure to meet the service obligation. As explained in
proposed Sec. 611.36(a), a scholarship recipient who the Department
determines has not met the scholarship's service obligation would
become responsible for repaying the scholarship, along with accrued
interest and costs, six months after the date he or she--
    (1) Completes the teacher training program;
    (2) Is no longer enrolled in that program; or
    (3) Is no longer employed as a teacher in a high-need school of a
high-need LEA.
    Proposed Sec. 611.36(b) would require a recipient who fulfills
some, but not all, of his or her service obligation to repay the amount
of the scholarship that is proportionate to the unmet portion of the
service obligation, along with accrued interest on this portion of the
scholarship and costs of collection, if any.

    Example: An individual receives a scholarship in the total
amount of $10,000 to attend a teacher preparation program for two
academic years. The individual graduates from the program, and works
in a high-need school of a high-need school district for one full
school year. The individual then moves, and takes a teaching
position in a school and school district that are not high-need.
    The individual has fulfilled one-half of his or her service
obligation. Therefore, the recipient must repay one-half of the
scholarship, interest on this amount that begins to accrue six
months after he or she graduated from the teacher preparation
program, and any costs of collection.

    Proposed Sec. 611.36(c) would permit an individual who must repay
the scholarship and accrued interest to obtain a payment schedule upon
request. Consistent with the Department's practice for student
financial assistance programs authorized in Title IV of the HEA. The
Department generally would establish a minimum monthly payment of no
less than $50. Proposed Sec. 611.36(e) also would clarify that any
minimum monthly payment must permit the full amount of scholarship and
interest to be repaid within ten years of the date the recipient
becomes responsible for repayment.
    As included in proposed Sec. 611.36(d), the Secretary would charge
interest in accordance with 31 U.S.C. 3717 and 34 CFR part 30 on the
unpaid balance that the scholarship recipient owes.

    Note: For calendar year 1999, the rate of interest is five
percent.
    Except where a scholarship recipient does not fulfill the
service obligation after receiving a deferment (see section G:
``Deferment of the Service Obligation''), no interest would be
charged for a period that precedes the date on which the scholarship
recipient must begin repayment.

    In this regard, proposed Sec. 611.36(e) would provide that a
recipient's failure to meet repayment or reporting requirements results
in the recipient's being in non-compliance with its terms and so liable
for repayment of the scholarship, interest and any costs of collection.
Proposed Sec. 611.36(f) would entitle the Department to take
appropriate legal action to collect any indebtedness.
    In proposing these requirements, we considered other periods of
time--both longer and shorter than six months--between the time a
recipient graduates or withdraws from the teacher preparation program
and the time the service obligation or obligation to repay begins. In
view of the various options proposed under which the service obligation
may be deferred (see the following section of this notice), six months
seems to offer recipients ample time to find employment in high-need
schools of high-need LEAs or reconsider any decision to withdraw from
the teacher preparation program.

G. Deferment of the Service Obligation

    Recognizing that illness or other personal circumstances may create
legitimate reasons for a scholarship recipient's inability to meet his
or her service obligation, proposed Sec. 611.37(b) identifies
conditions under which the Department would defer a service obligation.
These would include: Serious physical or mental disability that
prevents or substantially impairs the scholarship recipient's
employability as a teacher; an inability, despite due diligence, to
pass a required teacher licensure or certification examination or
otherwise secure employment as a teacher in a high-need school of a
high-need LEA; membership in the armed forces of the United States on
active duty for no more than three years; or other extraordinary

[[Page 60637]]

circumstances that the Secretary accepts.
    For the student financial assistance programs authorized in Title
IV of the HEA, the Department generally also offers loan deferment to
those who participate in the Peace Corps, Americorps, or other national
service. However, the express purpose of these Teacher Recruitment
Program scholarships is to address the immediate teacher shortages of
high-need LEAs by recruiting and training qualified individuals who
will become teachers in their schools. Individuals who are unable or
unwilling to accept these teaching positions after graduating from a
teacher preparation program should not accept the scholarships.
Accordingly, we do not believe that these proposed regulations should
make deferments of the service obligation available to scholarship
recipients who choose to work in these other areas.
    Proposed Sec. 611.37(c) would provide that unless the Secretary
determines otherwise, a scholarship recipient would apply to renew a
deferment on a yearly basis. The Department intends to prepare
guidance, which grantees and institutions offering scholarships would
provide to scholarship recipients, on the kind of information the
Department would expect to receive in any acceptable request for
deferment of the service obligation. Proposed Sec. 611.37(c) also would
require a scholarship recipient to begin teaching in a high-need school
of a high-need LEA within 60 days of the end of a deferment, or become
liable for repaying the scholarship, accrued interest, and any costs of
collection.
    As provided in proposed Sec. 611.37(d), interest would continue to
accrue during periods in which the service obligation is deferred.
However, the scholarship recipient would not be liable for this accrued
interest if he or she fulfills the service obligation once the period
of deferment has ended.

H. Discharge of Repayment Responsibility

    Proposed Sec. 611.38 would identify the very limited
circumstances--death, and total and permanent physical or mental
disability that prevents a scholarship recipient from teaching--in
which the Secretary would cancel the responsibility to repay a
scholarship and accrued interest for failure to fulfill the service
obligation.

I. Recipient and LEA Reporting Requirements

    The scholarship agreement also would clarify the recipient's
responsibility, as a condition of receipt of the scholarship, to ensure
that the Department has the information it needs to administer the
scholarship and payback provisions of the HEA. In particular, as noted
in proposed Sec. 611.39(a), within six months of the date a scholarship
recipient graduates from a teacher preparation program, he or she would
either--
    * Have the high-need LEA in which he or she is employed
provide the Department information that the Secretary may require that
(1) identifies the scholarship recipient through such basic information
as name, address, phone number, and social security number; (2)
confirms that he or she is teaching in a high-need school of a high-
need LEA; and (3) states whether the individual is teaching full- or
part-time and, if part-time, the full-time equivalency of this teaching
compared to the district's full-time teachers; or
    * Submit to the Department, along with his or her home
address, telephone number, and social security number (1) The required
repayment; (2) A request to repay the obligation in installments; or
(3) A request that the Secretary defer a required repayment, for
reasons that the proposed regulations permit, along with a sufficient
statement of justification.

    Note: Before the scholarship recipient's graduation, the IHE in
which the recipient is enrolled would provide him or her with
written information that explains the information the LEA would need
to submit to the Department for the first item above. This
information would contain the elements that the Office of Management
and Budget approves under the Paperwork Reduction Act. See the
Paperwork Reduction Act of 1995 section of this preamble.

    In this regard, we have included in Appendix B of this notice the
information that we are proposing that an LEA provide each year until
the Department has determined that the teacher has met his or her
service obligation. The content of Appendix B is included for
information purposes only; while its terms reflect the content of the
proposed regulations, these terms would not be included as a regulation
in the Code of Federal Regulations. Any written comment on the content
of the proposed reporting instrument should be sent to the person
listed in the Paperwork Reduction Act of 1995 section of this preamble.
Any written comment on the proposed regulations themselves, whose terms
the LEA reporting instrument would reflect, should be separately sent
to the person listed in the ADDRESSES section of this preamble.
    Proposed Sec. 611.39(b)(1) would require scholarship recipients,
who within six months of graduation report (through their LEAs) that
they are teaching in a high-need school of a high-need LEA, to have
their LEAs also provide updated employment information at the end of
the school year. Proposed Sec. 611.39(b)(2) would require the recipient
in subsequent years to have the LEA continue to provide this
information until the Department notifies the recipient that he or she
has fulfilled the service obligation. Proposed Sec. 611.39(b)(3) offers
to credit summer and intersession teaching in high-need schools of
high-need LEAs toward the recipient's fulfillment of the service
obligation.
    Conversely, proposed Sec. 611.39(c) would require those scholarship
recipients who (1) Do not complete the teacher training program, or (2)
Do not retain scholarships provided with program funds because of a
failure to remain in good academic standing, to submit to the
Department--
    * The required repayment;
    * A request to repay the obligation in installments; or
    * A request that the Secretary defer a required repayment
for reasons that the proposed regulations provide, along with a
sufficient statement of justification.)
    Proposed Sec. 611.39(c) also would have the Department, upon
receipt of this information, notify these individuals of the status of
their obligation, and of any schedule under which they would need to
repay their scholarship, interest, and any costs of collection.
    Finally, Proposed Sec. 611.39(d) would make the scholarship
recipient's agreement to continue providing this information (or, if
the recipient teaches in a high-need school, have the high-need LEA
provide this information) an ongoing condition of the scholarship. In
addition, until the Department has determined that the recipient either
has met the service obligation or has repaid the full amount of
scholarship, interest, and costs that are due, the recipient would need
to ensure that the Department has a current home address and telephone
number, and a current work address and telephone number.

J. Responsibilities of Teacher Recruitment Program Grantees

    Section 611.40 of these proposed regulations would require each
Teacher Recruitment Program grantee to undertake certain basic
responsibilities with regard to scholarship recipients. These include:
    * Ensuring that, before any prospective scholarship
recipient executes a Teacher Recruitment Program scholarship agreement,
the

[[Page 60638]]

individual understands its terms and conditions;
    * Providing to the Department periodic information the
Department needs to identify the scholarship recipient and the
scholarship amount he or she received. This information includes (1)
The amount of the scholarship provided with program funds; (2) The
full-time equivalency (over each academic year) of the recipient's
enrollment in the teacher training program for which he or she receives
scholarship assistance; (3) The date of the scholarship recipient's
graduation or withdrawal from the teacher preparation program; and (4)
Whether the institution has withdrawn scholarship support because of a
failure to maintain good academic standing.
    * Providing the Department, after a scholarship recipient's
graduation or withdrawal from the teacher preparation program, the
original of the scholarship agreement that the recipient and the
grantee (or its partnering IHE, if the grantee is not an IHE) had
signed;
    * Holding an exit conference with each scholarship recipient
before the recipient's graduation or withdrawal from the teacher
preparation program to review (1) The recipient's responsibilities
under the scholarship agreement, and (2) The follow-up services that
the institution will provide during the recipient's first three years
of teaching.
    * As required by section 204 of the Act, providing (a)
scholarship recipients--both before and after graduation--with
appropriate support and follow-up services, including job counseling
and placement assistance, and (b) high-need LEAs with which the
grantees collaborate with information about the terms and conditions of
scholarships, and the availability of recipients to become teachers in
their high-need schools. These support services are intended to help
ensure that, upon graduation, scholarship recipients are able to secure
teaching positions in these schools.

K. Applicability of Proposed Regulations to State and Partnership
Program Grantees

    As explained in the BACKGROUND section of this preamble, recipients
of Title II, HEA, State and Partnership Program grants may conduct
activities authorized under the Teacher Recruitment Program if these
activities are described in their approved grant applications. Proposed
Sec. 611.42 would make the provisions governing scholarships awarded
under the Teacher Recruitment Program also applicable to any
scholarships awarded with funds provided under these other two Teacher
Quality Enhancement Grant programs.

Goals 2000: Educate America Act

    The Goals 2000: Educate America Act (Goals 2000) focuses the
Nation's education reform efforts on the eight National Education Goals
and provides a framework for meeting them. Goals 2000 promotes new
partnerships to strengthen schools and expands the Department's
capacities for helping communities to exchange ideas and obtain
information needed to achieve the goals.
    These proposed regulations would address the National Education
Goal that the Nation's teaching force will have the content knowledge
and teaching skills needed to instruct all American students for the
next century.

Clarity of the Regulations

    Executive Order 12866 and the President's Memorandum of June 1,
1998 on ``Plain Language in Government Writing'' require each agency to
write regulations that are easy to understand.
    The Secretary invites comments on how to make these proposed
regulations easier to understand, including answers to questions such
as the following:
    * Are the requirements in the proposed regulations clearly
stated?
    * Do the proposed regulations contain technical terms or
other wording that interferes with their clarity?
    * Does the format of the proposed regulations (grouping and
order of sections, use of headings, paragraphing, etc.) aid or reduce
their clarity?
    * Would the proposed regulations be easier to understand if
we divided them into more (but shorter) sections? (A ``section'' is
preceded by the symbol ``Sec. '' and a numbered heading; for example,
Sec. 611.36 What are the consequences of a scholarship recipient's
failure to meet the service obligation?)
    * Could the description of the proposed regulations in the
SUPPLEMENTARY INFORMATION section of this preamble be more helpful in
making the proposed regulations easier to understand? If so, how?
    * What else could we do to make the proposed regulations
easier to understand?
    Send any comments that concern how the Department could make these
proposed regulations easier to understand to the person listed in the
ADDRESSES section of the preamble.

Regulatory Flexibility Act Certification

    The Secretary certifies that these proposed regulations would not
have a significant economic impact on a substantial number of small
entities. Entities that would be affected by these regulations are IHEs
and States that provide scholarship assistance under the Teacher
Recruitment, State, and Partnership Programs; LEAs in which scholarship
recipients teach upon graduation from IHE teacher preparation programs;
and scholarship recipients. The information burden on each of these
groups is minimal, and consists of reporting basic information that the
IHE, LEA, or individual already has available. Individuals are not
considered to be ``small entities'' under the Regulatory Flexibility
Act. Hence, the final regulations would not have a significant impact
on any entity because they would not impose excessive regulatory burden
or require unnecessary Federal supervision. Rather, the regulations
would impose minimal requirements to determine whether scholarship
recipients are entitled to retain their scholarship assistance.

Paperwork Reduction Act of 1995

    Proposed Secs. 611.34--611.40 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 this
notice and these sections to the Office of Management and Budget (OMB)
for its review.

Collection of Information: Teacher Quality Enhancement Grant Programs

    Recipients of scholarships provided with any Teacher Quality
Enhancement Grant program funds would first execute a scholarship
agreement with IHEs that are associated with grantee States or
partnerships. These agreements would provide that, unless the
Department defers the service obligation, the recipient would either
(1) Fulfill the service obligation or (2) Repay to the Department the
scholarship with interest and costs of collection, if any. The
agreements also would describe how the Department would administer the
service-obligation requirement, and identify the information the
Department would need for this purpose from the recipient, program
grantees, and high-need LEAs.
    Beyond the need for an executed scholarship agreement, these
proposed regulations would impose minimal additional information burden
on program grantees, scholarship recipients and the LEAs in which they
will teach in order to ensure that scholarship recipients meet their
service obligations.
    Program grantees. At the beginning of each school term, program
grantees would provide the Department with

[[Page 60639]]

basic identifying on each scholarship recipient. This information would
include items such as name, address, telephone number, date of birth
and social security number, as well as the amount and term of the
scholarship. (This information is the same as in Sections A and B of
the Proposed Scholarship Terms and Conditions contained in the appendix
A of this notice.) After the recipient's graduation from the teacher
preparation program, the grantee would notify the Department of the
date of the recipient's graduation and the total amount of scholarship
provided to the recipient with program funds. In addition, should a
recipient withdraw from the teacher preparation program during the
school year, or lose a scholarship because of poor academic
performance, the grantee would promptly notify the Department of the
date of the individual's withdrawal from the program or loss of
scholarship assistance. The grantee also would inform the Department of
the total amount of program funds that the individual had received in
scholarship assistance, and would provide the Department the original
of all scholarship agreements that any scholarship recipient had
executed.
    Scholarship recipients. The recipient would have the LEA in which
he or she becomes employed provide the Department information that (a)
Identifies the school in which he or she teaches; (b) States whether
the recipient is teaching full- or part-time; and (c) Confirms that the
school and LEA are of ``high-need''as defined by program regulations.
(See the discussion immediately following in this section on ``LEAs.'')
The scholarship recipient would continue to have the LEA provide this
information until the Department notifies the recipient that he or she
has fulfilled the service obligation. Consistent with section 204(e) of
the HEA, the Department will use the information the LEA provides to
determine whether the recipient needs to repay scholarship assistance
and accrued interest and, where appropriate, to begin implementing debt
collection procedures.
    Alternatively, the scholarship recipient would either (1) Repay the
scholarship, interest, and any costs of collection, (2) Request a
repayment schedule, or (3) Request a deferment of the service
obligation and explain why the deferment is appropriate.
    LEAs. LEAs would provide the Department information to confirm that
(1) The school and LEA in which the scholarship recipient teaches is
``high need,''and (2) The recipient is employed as a teacher full- or
part-time (and if part-time, the percentage of full-time equivalency).
The LEA would provide this data at the beginning of the school year or
term in which the recipient begins teaching. At the end of the school
year, the LEA would provide the Department follow-up information that
confirms the individual's employment status for the prior year (or
term). In subsequent years the LEA would continue to provide this
information to the Department until the Department notifies the
scholarship recipient that he or she has fulfilled his or her service
obligation, or the recipient no longer works for the LEA, whichever
comes first.
    Before graduating, the IHE awarding the scholarship would provide
the scholarship recipient information on what data the LEA needs to
provide the Department. The Department's proposal for this LEA data in
contained in Appendix B of this notice.
    We estimate annual reporting and recordkeeping burden for this
collection of information to average approximately 0.6 hours for each
of the 5,000 anticipated scholarship recipients, approximately 17.7
hours for each of the anticipated 75 IHEs and other program grantees,
and approximately 2.5 hours for each of the anticipated 375 LEAs. This
annual reporting and recordkeeping burden includes the time for
reviewing instructions, searching existing data sources, gathering and
maintaining the data needed, and completing and reviewing the
collection of information. Thus, we estimate the total annual reporting
and recordkeeping burden for this collection to be 5,408.5 hours.
    If you want to comment on the information collection requirements,
please send your comments to the Office of Information and Regulatory
Affairs, OMB, room 10235, New Executive Office Building, Washington, DC
20503; Attention: Desk Officer for U.S. Department of Education. You
may also send a copy of these comments to the Department representative
named in the ADDRESSES section of this preamble.
    We consider your comments on this proposed collection of
information in --
    * Deciding whether the proposed collection is necessary for
the proper performance of our functions, including whether the
information will have practical use;
    * Evaluating the accuracy of our estimate of the burden of
the proposed collection, including the validity of our methodology and
assumptions;
    * Enhancing the quality, usefulness, and clarity of the
information we collect; and
    * Minimizing the burden on those who must respond. This
includes exploring the use of appropriate automated, electronic,
mechanical, or other technological collection techniques or other forms
of information technology; e.g., permitting electronic submission of
responses.
    OMB is required to make a decision concerning the collections of
information contained in these proposed regulations between 30 and 60
days after publication of this document in the Federal Register.
Therefore, to ensure that OMB gives your comments full consideration,
it is important that OMB receives the comments within 30 days of
publication. This does not affect the deadline for your comments to us
on the proposed regulations.

Intergovernmental Review

    This program is subject to Executive Order 12372 and the
regulations in 34 CFR part 79. One of the objectives of the Executive
order is to foster an intergovernmental partnership and a strengthened
federalism. The Executive order relies on processes developed by State
and local governments for coordination and review of proposed Federal
financial assistance.
    This document is intended to provide early notification of our
specific plans and actions for this program.

Assessment of Educational Impact

    The Secretary particularly requests comments on whether these
proposed regulations would require transmission of information that any
other agency or authority of the United States gathers or makes
available.

Electronic Access to This Document

    You may review this document, as well as all other Department of
Education documents published in the Federal Register, in text or
portable document format (PDF) on the World Wide Web at either of the
following sites:

http://ocfo.ed.gov/fedreg.htm
http://www.ed.gov/news.html

To use the PDF you must have the Adobe Acrobat Reader Program with
Search, which is available free at either of these sites. If you have
questions about using the PDF, call the U.S. Government Printing Office
at (202) 512-1530 or, toll free, at 1-888-293-6498.

    Note: The official version of the 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.access.gpo.gov/nara/index.html

[[Page 60640]]

    Program Authority: 20 U.S.C. 1021 et seq. and 1024(e)

List of Subjects in 34 CFR Part 611

    Colleges and universities, Elementary and secondary education,
Grant programs--education.

(Catalog of Federal Domestic Assistance Number 84.336: Teacher
Quality Enhancement Grants Program)

    Dated: October 28, 1999.
Claudio R. Prieto,
Acting Assistant Secretary for Postsecondary Education.

    For the reasons stated in the preamble, the Secretary proposes to
amend part 611 of Chapter VI of title 34 of the Code of Federal
Regulations as follows:

PART 611--TEACHER QUALITY ENHANCEMENT GRANTS PROGRAM

    1. The authority citation for part 611 is revised to read as
follows:

    Authority: 20 U.S.C. 1021 et seq. and 1024(e), unless otherwise
noted.

    2. A new subpart A consisting of Sec. 611.1 is added to read as
follows:

Subpart A--General Provisions

Sec. 611.1  What definitions apply to the Teacher Quality Enhancement
Grants Program?

    The following definitions apply to this part:
    High-need local educational agency (LEA) means an LEA that meets
one of the following definitions:
    (a) An LEA with at least one school in which 50 percent or more of
the enrolled students are eligible for free and reduced lunch
subsidies.
    (b) An LEA that has one school where--
    (1) More than 34 percent of academic classroom teachers overall
(across all academic subjects) do not have a major, minor, or
significant course work in their main assignment field; or
    (2) More than 34 percent of the main assignment faculty in two of
the core-subject departments do not have a major, minor, or significant
work in their main assigned field.
    (c) An LEA that serves a school whose attrition rate among
classroom teachers was 15 percent or more over the last three school
years.
    High-need school means an elementary or secondary school operated
by a high-need LEA in which the school's students or teaching staff
meet the elements in paragraph (a), (b), or (c) of the definition of a
high-need LEA.
    Main assignment field means the academic field in which teachers
have the largest percentage of their classes.
    Significant course work means four or more college-or graduate-
level courses in the content area.

(Authority: 20 U.S.C. 1024(e))

    3. A new subpart D consisting of Secs. 611.34 through 611.40 is
added to read as follows:

Subpart D--Teacher Recruitment Program

Sec.
611.30-.33 [Reserved]
611.34 Under what circumstances may an individual receive a
scholarship of program funds to attend a teacher training program?
611.35 How does the Secretary calculate the period of the
scholarship recipient's service obligation?
611.36 What are the consequences of a scholarship recipient's
failure to meet the service obligation?
611.37 Under what circumstances may the Secretary defer a
scholarship recipient's service requirement?
611.38 Under what circumstances does the Secretary discharge a
scholarship recipient's obligation to repay for failure to meet the
service obligation?
611.39 What are a scholarship recipient's reporting
responsibilities?
611.40 What are a grantee's responsibilities for helping to
implement the scholarship requirements?

Subpart D--Teacher Recruitment Program

Secs. 611.30-611.32 [Reserved]

Sec. 611.34  Under what circumstances may an individual receive a
scholarship of program funds to attend a teacher training program?

    (a) General: The service obligation. An individual, whom a grantee
finds eligible to receive a scholarship funded by the Teacher
Recruitment Program to attend a teacher preparation program, may
receive the scholarship only after executing a binding agreement with
the institution of higher education (IHE) offering the scholarshipthat,
after completing the program, the individual will either--
    (1) Teach in a high-need school of a high-need LEA for a period of
time equivalent to the period for which the individual receives the
scholarship; or
    (2) Repay, as set forth in Sec. 611.36, the Teacher Recruitment
Program funds provided as a scholarship.
    (b) Content of the scholarship agreement. To implement the service-
obligation requirement, the scholarship agreement must include terms,
conditions, and other information consistent with Secs. 611.35-611.39
that the Secretary determines to be necessary.

(Authority: 20 U.S.C. 1024(e))

Sec. 611.35  How does the Secretary calculate the period of the
scholarship recipient's service obligation?

    (a) Calculation of period of scholarship assistance. (1) The
Secretary calculates the period of time for which a student received
scholarship assistance on the basis of information provided by the
grantee under Sec. 611.40(b).
    (2) The period for which the recipient received scholarship
assistance is the period during which an individual enrolled in the
teacher preparation program on a full-time basis, excluding the summer
period, would have completed the same course of study.
    (b) Calculation of period needed to teach to meet the service
obligation. (1) The period of the scholarship recipient's service
obligation is the period of the individual's receipt of scholarship
assistance as provided in paragraph (a) of this section.
    (2) The Secretary calculates the period that a scholarship
recipient must teach in a high-need school of a high-need LEA in order
to fulfill his or her service obligation by--
    (i) Comparing the period in which the recipient received a
scholarship as provided in paragraph (a) of this section with the
information provided by the high-need LEA under Sec. 611.39(a) and (b)
on the period the recipient has taught in one of its high-need schools;
and
    (ii) Adjusting the period in which the recipient has taught in a
high-need school to reflect the individual's employment, if any, as a
teacher on a part-time basis relative to classroom teachers the LEA
employs on a full-time basis under the LEA's standard yearly contract
(excluding any summer or intersession period).
    (c) The Secretary adjusts the period of a scholarship recipient's
service obligation as provided in paragraph (b) of this section to
reflect information the high-need LEA provides under Sec. 611.39(a) and
(b) that the scholarship recipient also has taught in a high-need
school in a summer or intersession period.

(Authority: 20 U.S.C. 1024(e))

Sec. 611.36  What are the consequences of a scholarship recipient's
failure to meet the service obligation?

    (a) Obligation to repay: General. (1) A scholarship recipient who
does not fulfill his or her service obligation must--
    (i) Repay the Department the full amount of the scholarship,
including the principal balance, accrued interest, and any collection
costs charged under paragraphs (c) and (d) of this section; or

[[Page 60641]]

    (ii) Be discharged of any repayment obligation as provided in
Sec. 611.38.
    (2) Unless the service obligation is deferred as provided in
Sec. 611.37 or the repayment requirement is discharged, the obligation
to repay the amount provided in paragraph (a)(1) of this section begins
six months after the date the recipient--
    (i) Completes the teacher training program without beginning to
teach in a high-need school of a high-need LEA; or
    (ii) Is no longer enrolled in the teacher training program.
    (3) The Secretary determines whether a scholarship recipient has
fulfilled the service obligation on the basis of information that the
Department receives as provided in Sec. 611.39(a) and (b).
    (b) Obligation to Repay: Partial performance of the service
obligation. (1) A scholarship recipient who teaches in a high-need
school of a high-need school district for less than the period of his
or her service obligation must repay--
    (i) The amount of the scholarship that is proportional to the unmet
portion of the service obligation;
    (ii) Interest that accrues on this portion of the scholarship
beginning six months after the recipient's graduation from the teacher
preparation program; and
    (iii) Costs of collection, if any.
    (2) Unless the service obligation is deferred or the repayment
requirement is discharged, the obligation to repay the amount provided
in paragraph (b)(1) of this section begins six months after the date
the recipient is no longer employed as a teacher in a high-need school
of a high-need LEA.
    (c) Availability of payment schedule. (1) Upon request to the
Secretary, the scholarship recipient may repay the scholarship and
accrued interest according to a payment schedule that the Secretary
establishes.
    (2) A payment schedule must permit the full amount of the
scholarship and accrued interest to be repaid within ten years. The
minimum monthly payment is $50 unless a larger monthly payment is
needed to enable the full amount that is due to be paid within this
timeframe.
    (d) Interest. In accordance with 31 U.S.C. 3717 and 34 CFR part 30,
the Secretary charges interest on the unpaid balance that the
scholarship recipient owes. However, except as provided in
Sec. 611.37(d), the Secretary does not charge interest for the period
of time that precedes the date on which the scholarship recipient is
required to begin repayment.
    (e) Failure to meet requirements. A scholarship recipient's failure
to satisfy the requirements of Secs. 611.35-611.39 in a timely manner
results in the recipient being--
    (1) In non-compliance with the terms of the scholarship;
    (2) Liable for repayment of the scholarship and accrued interest;
and
    (3) Subject to collection action.
    (f) Action by reason of default. The Secretary may take any action
authorized by law to collect the amount of scholarship, accrued
interest and collection costs, if any, on which a scholarship recipient
obligated to repay under this section has defaulted. This action
includes, but is not limited to, filing a lawsuit against the
recipient, reporting the default to national credit bureaus, and
requesting the Internal Revenue Service to offset the recipient's
Federal income tax refund.

(Authority: 20 U.S.C. 1024(e))

Sec. 611.37  Under what circumstances may the Secretary defer a
scholarship recipient's service requirement?

    (a) Upon written request, the Secretary may defer a service
obligation for a scholarship recipient who--
    (1) Has not begun teaching in a high-need school of a high-need LEA
as required by Sec. 611.34(a); or
    (2) Has begun teaching in a high-need school of a high-need LEA,
and who requests the deferment within six months of the date he or she
no longer teaches in this school.
    (b) To obtain a deferment of the service obligation, the recipient
must provide the Secretary satisfactory information of one or more of
the following circumstances:
    (1) Serious physical or mental disability that prevents or
substantially impairs the scholarship recipient's employability as a
teacher.
    (2) The scholarship recipient's inability, despite due diligence
(for reasons that may include the failure to pass a required teacher
certification or licensure examination), to secure employment as a
teacher in a high-need school of a high-need school LEA.
    (3) Membership in the armed forces of the United States on active
duty for a period not to exceed three years.
    (4) Other extraordinary circumstances that the Secretary accepts.
    (c) Unless the Secretary determines otherwise--
    (1) A scholarship recipient must apply to renew a deferment of the
service obligation on a yearly basis; and
    (2) The recipient has 60 days from the end of the deferment period
to begin teaching in a high-need school of a high-need LEA or become
liable for repayment of the scholarship, any accrued interest, and any
costs of collection.
    (d)(1) As provided in Sec. 611.36(e), during periods for which the
Secretary defers a scholarship recipient's service obligation, the
scholarship recipient does not have an obligation to repay the
scholarship. However, interest continues to accrue on the amount of the
scholarship.
    (2) If the scholarship recipient fulfills his or her service
obligation after the end of the deferment, the Secretary waives the
obligation to repay accrued interest.

(Authority: 20 U.S.C. 1024(e))

Sec. 611.38  Under what circumstances does the Secretary discharge a
scholarship recipient's obligation to repay for failure to meet the
service obligation?

    (a) The Secretary discharges the obligation of a scholarship
recipient to repay the scholarship, interest, and any costs for failure
to meet the service obligation based on information acceptable to the
Secretary of--
    (1) The recipient's death; or
    (2) The total and permanent physical or mental disability of the
recipient that prevents the individual from being employable as a
classroom teacher.
    (b) Upon receipt of acceptable documentation and approval of the
discharge request, the Secretary returns to the scholarship recipient,
or for a discharge based on death to the recipient's estate, those
payments received after the date the eligibility requirements for
discharge were met. The Secretary returns these payments whether they
are received before or after the date the discharge was approved.

(Authority: 20 U.S.C. 1024(e))

Sec. 611.39  What are a scholarship recipient's reporting
responsibilities?

    (a) Upon graduation. Within six months of graduating from a teacher
preparation program, a scholarship recipient must either--
    (1) Have the LEA in which the recipient is employed as a teacher
provide the Department information, which the Secretary may require, to
confirm--
    (i) The home address, phone number, social security number, and
other identifying information about the recipient;
    (ii) That he or she is teaching in a high-need school of a high-
need LEA; and
    (iii) Whether the individual is teaching full- or part-time and, if
part-time, the full-time equivalency of this teaching compared to the
LEA's full-time teachers; or

[[Page 60642]]

    (2) Provide the Department a current home address and telephone
number, a work address and telephone number, the recipient's social
security number, and one of the following:
    (i) The required repayment of the scholarship.
    (ii) A request that the Secretary permit the recipient to repay the
scholarship and accrued interest in installments as permitted by
Sec. 611.36(c).
    (iii) A request that the Secretary defer the service obligation as
permitted by Sec. 611.37.
    (b) Upon the close of the LEA's academic year. (1) At the close of
the LEA's academic year, a scholarship recipient--whose LEA reports
under paragraph (a)(1) of this section that he or she is teaching in a
high-need school of a high-need LEA--must have the LEA provide
information to the Department as the Secretary may require that
confirms the recipient's actual employment status for the preceding
period.
    (2) In subsequent school years, the recipient must have the LEA
continue to provide information to the Department on the recipient's
employment as the Secretary may require, until the Department notifies
the recipient that the service obligation has been fulfilled.
    (3)(i) The Secretary provides a scholarship recipient with credit
toward the service obligation for teaching in a high-need school of a
high-need LEA during a summer or intersession period (for LEAs that
operate year-round programs).
    (ii) To receive this credit, the recipient must have the LEA at the
end of the summer or intersession period provide information to the
Department, as the Secretary may require, that confirms that the
recipient has taught during this period in a high-need school.
    (c) Upon failure to graduate or withdrawal of scholarship support.
(1) Within six months of the date the scholarship recipient is no
longer enrolled in the teacher training program, or within six months
of the IHE's withdrawal of scholarship support for failure to maintain
good academic standing, , the recipient must submit to the Department--
    (i) The required repayment of the scholarship;
    (ii) A request that the Secretary establish a binding schedule
under which the recipient is obligated to repay the scholarship,
accrued interest, and any costs of collection; or
    (iii) A request that the Secretary defer the service obligation as
permitted by Sec. 611.37.
    (2) Upon review of the repayment or information provided under
paragraph (c)(1) of this section, the Department notifies the recipient
of the status of the recipient's obligations and of any schedule under
which the recipient must repay the scholarship.
    (d) Continuing responsibilities to report. Until the Secretary
determines that the individual either has satisfied his or her service
obligation or has repaid the full amount of the scholarship, accrued
interest, and any costs, the recipient also remains responsible for
providing the Department--
    (1) The information identified in this part; and
    (2) A current home address and telephone number, and a current work
address and work telephone number.

(Authority: 20 U.S.C. 1024(e))

Sec. 611.40  What are a grantee's responsibilities for helping to
implement the scholarship requirements?

    (a) Before awarding a scholarship. Before awarding scholarship
assistance with funds provided under the Teacher Recruitment Program to
any student attending a teacher preparation program, a grantee must--
    (1) Ensure that the student understands the terms and conditions
that the Secretary has determined must be included in the scholarship
agreement;
    (2) Have the student and the institution awarding the scholarship
execute a scholarship agreement that contains these terms and
conditions; and
    (3) Establish policies for--
    (i) The withdrawal of scholarship support for any student who does
not remain in good academic standing; and
    (ii) Determining when and if re-negotiation of a student's
scholarship package over an extended period of time is appropriate.
    (b) Reporting requirements. (1) Within 30 days of the beginning of
the teacher preparation program's academic term or within 30 days of
the execution of any scholarship agreement, whichever is later, the
grantee must provide to the Department the following information:
    (i) The identity of each scholarship recipient.
    (ii) The amount of the scholarship provided with program funds to
each recipient.
    (iii) The full-time equivalency, over each academic year, of each
recipient's enrollment in the teacher training program for which he or
she receives scholarship assistance.
    (iv) Other information as the Secretary may require.
    (2) Within 30 days of a scholarship recipient's graduation or
withdrawal from the teacher preparation program, the grantee must
provide to the Department the following information:
    (i) The date of the recipient's graduation or withdrawal.
    (ii) The total amount of program funds the grantee awarded as a
scholarship to the recipient.
    (iii) The original of any scholarship agreement executed by the
scholarship recipient and the grantee (or its partnering IHE if the
grantee is not an IHE) before the recipient was awarded a scholarship
with program funds.
    (iv) A statement of whether the institution has withdrawn
scholarship support because of the recipient's failure to maintain good
academic standing.
    (v) Other information as the Secretary may require.
    (c) Exit conference. An institution providing a scholarship with
funds provided under this part must conduct an exit conference with
each scholarship recipient before that individual leaves the
institution. During the exit conference the institution must give the
recipient a copy of any scholarship agreement the recipient has
executed. The institution also must review with the recipient--
    (1) The terms and conditions of the scholarship. including --
    (i) The recipient's service obligation;
    (ii) How the recipient can confirm whether a school and LEA in
which he or she would teach will satisfy the service obligation;
    (iii) Information that the recipient will need to have the LEA
provide to the Department to enable the Secretary to confirm that the
recipient is meeting the service obligation;
    (iii) How the recipient may request a deferment of the service
obligation, and information that the recipient should provide the
Department in any deferment request;
    (v) The consequences of failing to meet the service obligation
including, at a minimum, the amount of the recipient's potential
indebtedness; the possible referral of the indebtedness to a collection
firm, reporting it to a credit bureau, and litigation; and the
availability of a monthly payment schedule;
    (vi) The amount of scholarship assistance and interest charges that
the recipient must repay for failing to meet the service obligation;
and
    (vii) The recipient's responsibility to ensure that the Department
has a home address and telephone number, and a work address and
telephone number until the Secretary has determined that

[[Page 60643]]

the recipient has fulfilled the service obligation or the recipient's
debt has been paid or discharged; and
    (2) The follow-up services that the institution will provide the
student during his or her first three years of teaching in a high-need
school of a high-need LEA.
    (d) Programmatic responsibilities. (1) In implementing its approved
Teacher Recruitment Program grant, the grantee must--
    (1) Provide scholarship recipients both before and after graduation
with appropriate support services, including academic assistance, job
counseling, placement assistance, and teaching support that will help
to ensure that--
    (i) Upon graduation, scholarship recipients are able to secure
teaching positions in high-need schools of high-need LEAs; and
    (ii) After beginning to teach in a high-need school of a high-need
LEA, former scholarship recipients have appropriate follow-up services
and assistance during their first three years of teaching;
    (2) Provide LEAs with which the grantees collaborate in Teacher
Recruitment Program activities with information and other assistance
they need to recruit highly-qualified teachers effectively; and
    (3) Work with the high-need LEAs participating in its project to
ensure that scholarship recipients are placed, to the extent possible,
in high-need schools of those LEAs.

(Authority: 20 U.S.C. 1024(e))

Subpart E--Other Grant Conditions

    4. A new Sec. 611.42 is added to subpart E to read as follows:

Sec. 611.42  What rules govern scholarships funded by the State or
Partnership Program for individuals attending teacher preparation
programs?

    The provisions in Secs. 611.34-611.40 governing the receipt of
scholarships awarded under the Teacher Recruitment Program also apply
to any scholarships that are awarded with federal funds provided under
the State or Partnership Program authorized by section 202 or 203 of
the Higher Education Act.

(Authority: 20 U.S.C. 1021 et seq.)
Appendix A
(This appendix is provided for information purposes only, and will
not be included in final regulations issued for this program.)

Teacher Quality Enhancement Grant Programs--Title II, Higher
Education Act (HEA)

Proposed Scholarship Terms and Conditions

Section I: Recipient Section

Name (last, first, middle initial):
Permanent Address (street, city, State, ZIP code):
Date of Birth:
Area Code/Phone No.:
Social Security Number:

Section II: Institution Section

Part A

Name of Institution:
Address (street, city, State, ZIP code):
Institution's DUNS Number:
Name of Contact (last, first, middle initial):
Area Code/Phone No. of Institution Contact:
E-mail Address of Institution Contact:

Part B

Amount of Title II, HEA Funds Awarded as Scholarship:
Period of Scholarship:
Recipient Enrolled as Percentage of Full-Time Equivalent Student:
ED Grant Award Number:

Section III: Terms and Conditions

    Applicable Law: The terms of this agreement and any scholarship
assistance received with funds provided under Title II, sections 202-
204, of the Higher Education Act of 1965, as amended (the ``Act'') that
the recipient receives will be interpreted in accordance with Title II,
section 204, of the Act and any applicable Federal regulations. Section
204 of the Act embodies the Teacher Recruitment Program, whose purpose
is to address the severe shortages of qualified teachers in many school
districts and schools throughout the nation.
    Purpose of the Scholarship--the Recipient's Service Obligation:
Section 204(e) of the Act authorizes institutions and States that
receive Teacher Recruitment Program funds from the U.S. Department of
Education (the Department) to use these funds to provide scholarships
to qualified individuals who agree to become teachers and then work in
school districts and schools that face a serious teacher shortage.
Similarly, sections 202(d)(7) and 203(e)(4) of the Act authorize States
and institutions that receive State or Partnership Program grants
respectively to use these funds to carry out activities permitted under
the Teacher Recruitment Program. Therefore, recipients of scholarships
provided with federal funds under these two programs also are subject
to the requirements of section 204(e) of the Act.
    Consistent with section 204(e), the recipient accepts the
scholarship with the understanding that it carries with it a service
obligation. More specifically, in exchange for the scholarship, the
recipient agrees upon graduating from the institution's teacher
training program to teach in a ``high-need school'' of a ``high-need
school local educational agency (hereinafter ``high-need school
district'') for at least as long as the period for which the recipient
receives scholarship assistance. The recipient understands that the
period of time for which he or she receives scholarship assistance will
be determined in comparison to full-time enrollment in the teacher
preparation program (exclusive of summers). Similarly, the recipient
understands that the period of time he or she must teach in a high-need
school of a high-need school district will be determined in comparison
to what the school district considers to be teaching on a full-time
basis. Full-time basis does not include summers or optional
intersession periods for those school districts that operate year-round
programs.
    The recipient also understands that the institution has received
funds from the Department of Education to provide teacher recruitment
services to the scholarship recipient and so, consistent section 204 of
the Act, is responsible among other things for--
    1. Providing support services, if needed, to help the recipient
complete the teacher training program;
    2. Working with one or more high-need school districts, in
securing placement of the scholarship recipient, upon his or her
graduation, into a teaching position at a high-need school in the
school district; and
    3. Working with the high-need school and school district in which
the recipient begins to teach to provide the recipient with follow-up
services during his or her first three years of teaching.
    Recipient's Retention of Scholarship Assistance for Meeting the
Service Obligation: The recipient does not have to repay to the
Department the scholarship provided with funds under Title II of the
Act if the Department determines that the recipient has fulfilled
his or her service obligation. To determine that the recipient has
met the service obligation, the Department must receive information
to confirm that the recipient (1) Within six months of graduation
from the teacher training program, has teaching in a high-need
school of a high-need school district; and (2) Continues teaching in
a high-need school of a high-need school district for a period of
time that is equivalent to the period of time for which the
recipient receives this scholarship assistance.
    So that the Department may obtain the information it needs to
make these determinations, the recipient agrees within six (6)
months of graduation from the institution's teacher training program
to have the high-need school district in which he or she is teaching
provide to the Department information as the Department may require
that confirms:
    1. The school and school district in which the recipient is
teaching are ``high-need''as defined in the ``DEFINITION OF HIGH-
NEED SCHOOL DISTRICT AND HIGH-NEED SCHOOL,''below; and

[[Page 60644]]

    2. The recipient is teaching on a full-time basis or, if teaching
on a part-time basis, the amount of time the recipient is teaching as a
percentage of the time spent teaching by the district's full-time
teachers.
    Before graduating, the institution will provide the recipient
written guidance that explains the information the recipient must
have the school district provide the Department, and the date or
dates that this information is due.
    Scholarship recipients who attend the institution on a part-time
basis must teach in a high-need school of a high-need school
district for a period that is comparable to the full-time equivalent
period that the student receives scholarship assistance. The
Department treats both the full academic year of the teacher
training program, excluding summer, and the full academic year of
the school district in which the recipient will teach, excluding
summers and any intersession periods (for school districts that
operate year-round programs), as equivalent one-year periods of
time.
    Example: An individual receives a scholarship for the costs of
attending a teacher preparation program on a part-time basis. While
the program extends for two full years of coursework and clinical
experience, the scholarship recipient is enrolled part-time, and
completes the program in three years. The Department would consider
the period for which the individual receives a scholarship as two
academic years.
    Upon graduation, the individual begins teaching half time in a
high-need school of a high-need school district after receiving the
two full years of scholarship support. If the individual continues
to teach half time, he or she would meet the program's service
obligation by teaching in a high-need school of a high-need school
district for the standard contractual period of four school years.
This four-year period is equivalent to the period that a full-time
teacher would teach for two full school years.
    At the end of each school year, the recipient will have the
high-need school district in which he or she teaches provide the
Department with information to confirm that the recipient has taught
for the preceding period in a high-need school. The Department will
provide the recipient with credit towards meeting the service
obligation for time that a high-need school district confirms the
recipient has taught in a high-need school during a summer period
(or intersession period for districts that operate year-round
programs).
    Until the Department notifies the recipient that he or she has
met the service obligation, at the beginning and end of each
subsequent academic year the recipient will continue to have the
high-need school district inform the Department whether the
recipient is teaching in a high-need school. The recipient will have
the school district provide this information on or before October 1
and within seven days of the end of the school year, respectively.
    Before graduation, the institution will provide the recipient
forms that contain the information that the school districts will
need to provide to the Department.
    Definition of High-Need School District and High-Need School:
For purposes of this agreement, a ``high-need school district'' is a
school district that meets one of the following definitions:
    1. An school district with at least one school in which 50
percent or more of the enrolled students are eligible for free and
reduced lunch subsidies.
    2. A school district that has one school where--
    More than 34 percent of academic classroom teachers overall
(across all academic subjects) do not have a major, minor, or
significant course work in their main assignment field; or
    More than 34 percent of the main assignment faculty in two of
the core-subject departments do not have a major, minor, or
significant work in their main assigned field.

(For purposes of the definition above, ``Main assignment field''
means the academic field in which teachers have the largest
percentage of their classes. ``Significant course work'' means four
or more college- or graduate-level courses in the content area.)

    3. A school district that serves a school whose attrition rate
among classroom teachers was 15 percent or more in the last three
school years.
    For purposes of this Agreement, a ``high-need school'' is an
elementary or secondary school that meets one of the three tests
that enables a school district to be considered a ``high-need school
district.''
    Deferment of Service Obligation: The Department may defer the
scholarship recipient's responsibility to teach in a high-need
school of a high-need school district if the recipient provides
satisfactory information to confirm that he or she--
    1. Suffers from a serious physical or mental disability that
temporarily prevents or impairs the scholarship recipient from
working as a teacher;
    2. Is a member of the Armed Forces of the United States on
active duty;
    3. Is conscientiously seeking but is unable to secure employment
(for reasons that may include the failure to pass a required teacher
certification or licensure examination) as a teacher in a high-need
school of a high-need school district; or
    4. Is affected by other extraordinary circumstances that prevent
the scholarship recipient from securing such employment.
    The recipient must apply to the Department for a deferment of
the service obligation. The recipient must do so within six (6)
months of his or her graduation (or withdrawal) from the teacher
training program or, if the recipient has already begun teaching in
a high-need school of a high-need school district, within six (6)
months of the date he or she no longer teaches in this school.
Unless the Department determines otherwise, the recipient must apply
to the Department to renew a deferment on a yearly basis. Deferments
for military service may not exceed three years. During the period
of any deferment, the recipient agrees to provide the Department
with current information (including updating information) on the
recipient's home address and phone number, and work address and
telephone number.
    The obligation to repay the scholarship, as set forth below in
``Repayment for Failure to Meet Service Obligation,'' is not
deferred until the Department determines that a deferment is
appropriate.
    Repayment for Failure to Meet Service Obligation: The recipient
agrees to repay to the Department the full amount of the scholarship
(with accrued interest and costs of collection, if any, as described
below) if he or she does not--
    (1) Meet the service obligation or reporting requirements
identified above in ``Recipient's Retention of Scholarship
Assistance for Meeting the Service Obligation;'' or
    (2) Receive a deferment of this obligation as explained above in
``Deferment of Service Obligation.''
    If the scholarship recipient does not teach in a high-need
school of a high-need school district within six (6) months of his
or her graduation from the teacher preparation program, the
recipient becomes obligated to repay the scholarship six months
after the date of completion of the teacher training program.
    If the scholarship recipient withdraws from the teacher
preparation program prior to graduating, the recipient becomes
obligated to repay the scholarship six (6) months after his or her
withdrawal from the program.
    If upon graduation from the institution's teacher preparation
program the scholarship recipient teaches in a high-need school of a
high-need school district for a period that is less than the period
of his or her service obligation, the recipient becomes responsible
for repayment of the percentage of the scholarship (and interest
that accrues on this portion of the scholarship) equal to the
percentage of the period for which the service obligation was not
fulfilled.

    Example: An individual receives a scholarship in the total
amount of $10,000 to attend a teacher preparation program for two
academic years. The individual graduates from the program, and works
in a high-need school of a high-need school district for one full
school year. The individual then moves, and takes a teaching
position in a school and school district that are not high-need.
    The individual has fulfilled one-half of his or her service
obligation, and so must repay one-half of the scholarship, plus
interest that accrues on this amount beginning six months after
graduation from the teacher preparation program (see ``INTEREST,''
below), and any costs of collection. This indebtedness attaches to
the recipient six months after the individual is no longer employed
as a teacher in the high-need school of a high-need school district.
    Until the scholarship recipient either satisfies the service
obligation or repays the scholarship, interest, and costs of
collection, if any, the recipient agrees to provide the Department a
current home address and telephone number and a work address and
telephone number, as well as other needed identifying information.
In addition, the recipient understands that the Department, the
institution, and the high-need LEA are or will be using the
recipient's social security number so that the Department can, if
necessary, secure payment of these amounts from the recipient if he
or she fails to meet the service obligation.

[[Page 60645]]

    Availability of Monthly Repayment Schedule: Upon request, the
Department will provide to the recipient a monthly repayment
schedule. Unless, for cause, the Department establishes another
repayment schedule, the schedule will require the recipient to repay
the Department the full amount of the scholarship and accrued
interest in minimum monthly payments of no less than $50 per month.
However, the payment schedule must enable the recipient to repay all
scholarship and accrued interest that is due within ten years of the
date the recipient becomes responsible for repaying these amounts.
    The first payment will be due 30 days after the Department
notifies the recipient of the payment schedule, or at such
subsequent time that the Department may identify.
    Interest: In accordance with 31 U.S.C. 3717 and 34 CFR part 30,
the recipient agrees to pay interest on the unpaid balance that the
scholarship recipient owes for failure to meet the service
obligation. Interest will begin to accrue as of the date the
recipient becomes responsible for repayment of the scholarship. See
``Repayment for Failure to Meet Service Obligation,'' above. No
interest is charged for the period of time that precedes the date on
which the scholarship recipient becomes responsible for repayment.
Interest accrues during any period in which the Department defers
the service obligation, but is waived if the scholarship recipient
completes the service obligation.
    The rate of interest that would apply to repayment of this
scholarship is __%.
    Collection of Defaulted Repayment Obligation: The Department may
take any action authorized by law to collect the amount of
scholarship, accrued interest and collection costs, if any, on which
a scholarship recipient obligated to repay under this section has
defaulted. Actions available to the Department include, but are not
limited to, filing a lawsuit against the recipient, reporting the
default to national credit bureaus, and requesting the Internal
Revenue Service to offset the recipient's Federal income tax refund.
    Discharge of a Required Repayment: The Department discharges an
obligation to repay the scholarship and interest of a scholarship
recipient who has died or who demonstrates to the Department's
satisfaction that, because of permanent physical or mental
disability, he or she is not employable as a teacher.
    Upon receipt of acceptable documentation and approval of the
discharge request, the Department returns to the scholarship
recipient, or for a discharge based on death, the recipient's
estate, those payments received after the date the eligibility
requirements for discharge were met and prior to the date the
discharge was approved. The Department also returns any payments
received after the date the discharge was approved.
    Exit Conference: Before the recipient graduates or withdraws
from the institution, the institution will provide the recipient an
opportunity to review fully the terms and conditions of this
scholarship agreement.
    My signature certifies that I have read, understand, and agree
to the terms and conditions of this scholarship agreement.

Scholarship Recipient's Signature    Date:
    Name of Scholarship Recipient:
Authorized Institutional Official    Date:
    Name of Official:
    Title:

Appendix B

(This appendix is provided for information purposes only, and will
not be included in final regulations issued for this program)

Teacher Quality Enhancement Grant Programs

Title II, Higher Education Act

Verification of Teaching Obligation

    The individual identified below is a teacher employed by your
school district. He or she received a scholarship provided under the
Teacher Quality Enhancement Grant Programs to attend a teacher
preparation program. As a condition of that scholarship, within six
months of completing the program the individual must begin teaching
in a high-need school, as that term is defined in Section II, Part C
of this form. The individual must continue teaching in a high-need
school for a period equivalent to the length of time during which he
or she received the scholarship. The U.S. Department of Education
needs the information identified in this document so that it can
confirm that the individual has fulfilled this service obligation.
    For Sections I and II, we ask that you furnish this information
by October 1 for individuals who begin teaching at the beginning of
the school year, and within seven days of receipt for individuals
who begin teaching at other times. The Department needs to obtain
the information only once during the school year.
    For Section III, we ask that you furnish the information on the
teacher's regular school-year employment in your school district
(Parts A1 and A2 and Part B) within seven days of the end of the
school year. If the individual teaches during the summer (or
intersession period if the school district operates a year-round
program) in a high-need school, we ask that you furnish the
information in Part A3 within seven days of the end of the summer
session. Please also include any changes in the name, address,
telephone number, fax number, or E-mail address of the school
district's reporting official that was previously provided in
Section I.
    Please feel free to use this form or any other format you
prefer. Please mail this information to: U.S. Department of
Education, Office of Postsecondary Education, Teacher Quality
Program Office, 1990 K Street, NW, 6th Floor, Washington, DC 20202-
____. If you prefer to provide this information over the Internet,
please contact the Teacher Quality program office at:____. You will
be sent an electronic copy of this document.
    Thank you for your assistance.

Section I: Scholarship Recipient/Teacher Information

Name:
Permanent Address:
Permanent Telephone Number:
Social Security Number:
Date of Birth:

Section II: Scholarship Recipient/Teacher Information

Part A

School District:
Address:
Name of District Official Providing This Information:
Telephone Number:
Fax Number:
E-mail:
    (Name of Teacher) has been employed by the school district as a
teacher at (Name of School):
__ since the beginning of this school year
__ beginning on ____(date) (____weeks after the school year began).

Part B

    During the current academic year, he/she will be teaching at
this school ____ full-time ____ part-time.
    If part-time, he/she has a teaching schedule that is ____ % of
the district's full-time teachers

Part C

    To retain his/her financial assistance as a scholarship, (Name
of School) must be a ``high-need school'' as the term is used in the
Teacher Quality Enhancement Grant Programs. Please check at least
one number that applies to the school:
    1. ____ 50% or more of the enrolled students are eligible for
free and reduced lunch subsides.
    2. ____ 34% or more of the school's academic classroom teachers
do not have a major, minor, or significant course work in their main
assignment field.
    3. ____ 34% or more of the main assignment faculty in two of the
core-subject departments do not have a major, minor or significant
work in their main assigned field.
    4. ____ The school has had an attrition rate among classroom
teachers of 15% or more in the last three school years.

    Note: If none of these categories applies to the school in which
the individual is teaching, please notify the individual
immediately. He or she is at risk of becoming legally responsible
for repaying of the full amount of his or her scholarship.

Questions/Comments

    I certify that the information contained in this document is
correct.

Signature of School District Official:
Date:

Section III: Confirmation of School-Year/Summer/Intersession
Employment

(To be completed within seven days of the end of the school year or
summer/intersession period. Please submit to the U.S. Department of
Education along with the previously completed Sections I and II.)

Part A

    (Name of Teacher):
    1. ____ continued to teach at (Name of School) for the remainder
of the school year in the same full-time or part-time capacity as
reported earlier this year.
    2. ____ became a teacher at another school in this school
district (School Name) beginning (date) and taught there in the same

[[Page 60646]]

full-time or part-time capacity as previously reported. This school
is a high-need school because it meets the criterion in No. ____ in
Section II.C of this document.
    3. ____ taught this summer / intersession period at (Name of
School). This school is a high-need school because it meets the
criterion in No. ____ in Part II.C of this document. The individual
taught at this school from (date) to (date).

Part B

    If neither 1 nor 2 of Part A is true, please explain the change
of the individual's employment status from what the school district
previously reported in Section II. If applicable, please also
provide the date on which the individual no longer was employed by
the school district or worked in a high-need school.

Questions/Comments

    I certify that the information contained in this document is
correct.

Signature of School District Official:
Date:

[FR Doc. 99-28666 Filed 11-4-99; 8:45 am]
BILLING CODE 4000-01-U