[Federal Register Volume 73, Number 244 (Thursday, December 18, 2008)]
[Notices]
[Pages 77022-77023]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-30009]
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DEPARTMENT OF EDUCATION
DEPARTMENT OF THE TREASURY
OFFICE OF MANAGEMENT AND BUDGET
Federal Family Education Loan Program (FFELP)
AGENCY: Department of Education, Department of the Treasury, Office of
Management and Budget.
ACTION: Notice of terms and conditions of purchase of loans under the
Ensuring Continued Access to Student Loans Act of 2008; correction.
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SUMMARY: On December 2, 2008, the Department of Education, the
Department of the Treasury, and the Office of Management and Budget
(collectively, ``Secretaries and Director'') jointly published a notice
in the Federal Register (73 FR 73263) announcing the terms and
conditions under which the Department will purchase loans pursuant to
section 459A of the Higher Education Act of 1965, as amended (HEA),
enacted by the Ensuring Continued Access to Student Loans Act of 2008
(Pub. L. 110-227) and amended by Public Law 110-315 and Public Law 110-
350 (December 2 Notice). The terms and conditions announced in the
December 2 Notice apply to the purchase of Federal Family Education
Loan Program (``FFELP'') loans made for the 2007-2008 academic year
(the ``Short-term Purchase Program''). Included as an appendix to the
December 2 Notice was the Master Loan Sale Agreement under which these
purchases will be made. This notice makes three corrections to the
December 2 Notice.
FOR FURTHER INFORMATION CONTACT: U.S. Department of Education, Office
of Federal Student Aid, Union Center Plaza, 830 First Street, NE., room
113F1, Washington, DC 20202. Telephone: (202) 377-4401 or by e-mail:
[email protected].
If you use a telecommunications device for the deaf (TDD), call the
Federal Relay Service (FRS), toll free, at 1-800-877-8339.
Individuals with disabilities can obtain this document in an
accessible format (e.g., braille, large print, audiotape, or computer
diskette) on request to the contact listed in this section.
SUPPLEMENTARY INFORMATION:
Correction
Under the Short-term Purchase Program, the Department will purchase
loans made under sections 428 (subsidized Stafford loans), 428B (PLUS
loans), or 428H (unsubsidized Stafford loans) of the HEA for the 2007-
2008 academic year (``Eligible 2007-2008 Loans''). The December 2
Notice described the method the Department uses to determine the amount
of loans it will purchase in a week from each lender that offers to
sell loans during that week. The December 2 Notice makes clear that the
Department will spend up to $500 million to purchase loans in each week
of the Short-term Purchase Program. As noted in the December 2 Notice,
if $500 million is not sufficient to purchase all loans offered for
sale during a week, the Department must determine that portion of the
available funds which it will use to purchase loans offered by each
seller that submitted an offer for that week.
The December 2 Notice included an error in its explanation of how
the Department will determine the portion of the $500 million that is
available each week that it will use to purchase loans offered by each
seller that submitted an offer for that week if there are not
sufficient funds to purchase all loans offered. Specifically, in the
second full paragraph, second column on page 73264 of the December 2
Notice, and in the second full paragraph in section 1 of the Master
Loan Sale Agreement, which appears on page 73272 of the December 2
Notice, we incorrectly state that the Department will purchase from
each seller that portion of the loans it offers to sell equal to each
seller's percentage of all Eligible 2007-2008 Loans held by all sellers
that submitted offers for that week. This is not an accurate
description of the method the Department uses.
To determine the amount it will spend to purchase loans from each
seller, the Department will first determine the total outstanding
principal amount of Stafford and PLUS loans made for the 2007-2008
academic year that are held by all sellers that submitted offers for
that week (without regard to the amount of those loans offered for sale
by a seller for that week), and the percentage of that total that is
held by each of those sellers.\1\ The Department will then multiply
$500 million by each seller's percentage of that total to determine the
amount it will spend to purchase loans offered for sale by that seller
for that week.
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\1\ The Department will make this determination using data
showing amounts held as of November 19, 2008.
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To correct this error, the Secretaries and the Director make the
following corrections to the December 2 Notice:
1. In the second full paragraph, second column of page 73264, the
first sentence is deleted and replaced with the following:
If the amount needed to purchase all loans in qualifying offers
in a given week exceeds $500 million, the Department will first
determine the total outstanding principal amount of subsidized and
unsubsidized Stafford loans and PLUS loans made for the 2007-2008
academic year held by all lenders that submit qualifying offers to
sell loans for that week, and the percentage of that total held by
each of those lenders. The Department will then multiply $500
million by each lender's percentage. To purchase loans from each
lender, the Department will spend the resulting amount, or such
lesser amount as may be needed to purchase all loans offered for
sale by that lender.
2. In the second full paragraph on page 73272 of the December 2
Notice (73 FR 73272), the sentence that reads ``If the amount needed to
purchase all Eligible Loans in qualifying offers exceeds $500 million,
the Department will purchase, from each Lender, an amount up to the
total outstanding
[[Page 77023]]
balances of the Loans offered by such Lender multiplied by the
percentage which the Lender's FFELP Loan volume originated in the 2007-
2008 academic year bears to the FFELP Loan volume originated in the
2007-2008 academic year by all Lenders that submitted qualifying offers
to sell Loans in the same week.'' is deleted and replaced with the
following:
If the amount needed to purchase all Eligible Loans in
qualifying offers in a given week exceeds $500 million, the
Department will determine the total outstanding principal amount of
Stafford and PLUS loans made for the 2007-2008 academic year that
are held by all Lenders that submit qualifying offers to sell loans
for that week, and the percentage of that total amount held by each
of those Lenders. The Department will then multiply $500 million by
each Lender's percentage of that total. To purchase Eligible Loans
offered for sale by a Lender, the Department will spend the
resulting amount determined for that Lender, or such lesser amount
as needed to purchase all Eligible Loans offered for sale by that
Lender.
3. The first sentence of section 5B(iii)(4) of the Master Loan Sale
Agreement on page 73282 of the December 2 Notice is revised by adding,
after the words ``to provide Loan Documents'' the words ``described in
section 3Q(xi), (xii), and (xiii)''.
Applicable Program Regulations: 34 CFR part 682.
Program Authority: 20 U.S.C. 1087i-1.
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Note: The official version of this document is the document
published in the Federal Register. Free Internet access to the
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(Catalog of Federal Domestic Assistance Number 84.032 Federal Family
Education Loan Program)
Dated: December 11, 2008.
Kent Talbert,
Acting Under Secretary for Education.
Dated: December 12, 2008.
Karthik Ramanathan,
Acting Assistant Secretary for Financial Markets of the Department of
the Treasury.
Steve McMillin,
Deputy Director, Office of Management and Budget.
[FR Doc. E8-30009 Filed 12-17-08; 8:45 am]
BILLING CODE 4000-01-P