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"Some college administrators seem so distracted with fund raising, academic infighting, and community initiatives that they set up their emergency communications departments very poorly. Training is poor to nonexistent, secretaries are pressed into service with tremendous responsibilities for running 'notification systems' 24/7 and on weekends because no one else knows how to do it and the administration won’t pay for additional staff. Procedures are seat-of-the-pants and dependent on HIPPO (highest paid person’s opinion), except when something like Virginia Tech happens and there is some sort of scramble to do something different." --Donna
Most Colleges Avoid Risk Management, Report Says
Jill Biden Shines a Global Spotlight on American Community Colleges
Speaking at a Unesco conference in Paris, the vice president’s wife stressed the importance of two-year institutions to the nation’s educational goals.
Connecticut Public Colleges Lose 200 Professors to Early Retirement
Administrators are scrambling to plug holes in their course schedules for fall, with most expecting to do so by hiring more adjuncts or increasing class sizes.
U. of Georgia Paid 2 Fraternities $2.4-Million to Relocate, Contracts Show
The two were among five with houses on property where the university plans to build new academic facilities.
New Allegations in Admissions Controversy at U. of Illinois Suggest Ex-Provost Played a Role
Linda P.B. Katehi, the incoming chancellor of the University of California at Davis, has insisted she knew nothing of the admission of politically connected applicants at Illinois.
Sonoma State U. Foundation May Lose $350,000 on Loan to Former Board Member
The foundation will be forced to issue fewer scholarships in the 2010-11 academic year because of a diminished endowment, a university official said.
College Suspends Student for Working in Gay Pornography | 58
President Obama's Visit to Notre Dame Carries Barely a Hint of Controversy That Preceded It | 58
Drug Sting Nabs 21 Students at U. of Illinois | 57
Faculty Members and Union Protest Staff Layoffs at Temple U. as 'Cruel' | 57
North Dakota Board's Vote Puts 'Fighting Sioux' Mascot on Thinner Ice | 57
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November 19, 2007
Audit: Pennsylvania Loan Agency Improperly Received More Than $33-Million
Washington — A final audit report released today by the U.S. Education Department found that the Pennsylvania Higher Education Assistance Agency has received at least $33-million in improper federal subsidy payments on student loans.
The student-loan agency, known as Pheaa, was one of several lenders that took advantage of a loophole in federal student-aid law that allowed it to receive guaranteed subsidies from the government far above market-based interest rates.
The controversy involving the overpayments dates from the 1980s, when Congress allowed nonprofit lenders — those that finance their loans with tax-exempt bonds — a guaranteed return of 9.5 percent to help protect them at a time when the economy was in the doldrums and the cost of making loans was high. Congress eliminated the 9.5-percent guarantee in 1993 but grandfathered in loans already made.
Most nonprofit lenders maintained that the government’s regulations allowed them to continue receiving the 9.5-percent return by simply refinancing bonds issued before the cutoff date.
In response to today’s report, Edward M. Kennedy, a Democrat and chairman of the Senate Health, Education, Labor, and Pensions Committee, issued a statement urging the Education Department to move aggressively to recoup money from Pheaa and to undertake a full-scale review of every lender that received subsidies after the 9.5-percent law was repealed.
“It’s obvious that we’ve only scratched the surface in terms of revealing the full extent of the 9.5-percent-loan scandal,” Senator Kennedy said.
The interim president of the Pennsylvania student-loan agency sent a letter to Margaret Spellings, the U.S. education secretary, urging her to reject the audit.
“Pheaa has always been in compliance with the department’s regulations,” said James Preston, the interim president. He said that the audit report “ignores 10 years of our compliance with regulations.”
The department’s review of payments to Pheaa marked the third major investigation that the inspector general has conducted into lenders’ misuse of federal student-aid dollars in recent years. —Sara Hebel
Posted on Monday November 19, 2007 | Permalink |Comments
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Any chance of a criminal indictment here?
— Marge Ryan Nov 20, 10:34 AM #
None, because no laws were overtly broken. Multiple lenders undertook this practice because the Dept. of Education allowed it under its interpretation of the law at the time. The AG has just now offered a different interpretation that makes these actions “illegal”. At worst, PHEAA will receive a hefty fine. At best, the Secretary of Education will admit that the Department’s own mismanagement led to these legal practices. An honest accounting would simply turn off the faucet without penalizing lenders who were working under the Department’s own interpretation of the law at the time.
— Tom Sabers Nov 20, 11:19 AM #