02-3600. Information Collection; Submission for OMB Review; Comment Request

AGENCY:

Corporation for National and Community Service.

ACTION:

Notice.

SUMMARY:

The Corporation for National and Community Service (hereinafter the “Corporation”) has submitted a public information collection request (ICR) to the Office of Management and Budget (OMB) for review and approval in accordance with the Paper Reduction Act of 1995, Public Law 104-13, (44 U.S.C. Chapter 35). Copies of this ICR, with applicable supporting documentation, may be obtained by calling the Corporation for National and Community Service, Bruce Kellogg, at [phone], extension 526. Individuals who use a telecommunications device for the deaf (TTY-TDD) may call [phone] between the hours of 9 a.m. and 5 p.m. Eastern Standard Time, Monday through Friday.

Comments should be sent to the Office of Information and Regulatory Affairs, Attn: Ms. Brenda Aguilar, OMB Desk Officer for the Corporation for National and Community Service, Office of Management and Budget, Room 10235, Washington, DC 20503, within 30 days from the date of publication in this Federal Register.

The OMB is particularly interested in comments which:

• Evaluate whether the proposed collection of information is necessary for the proper performance of the functions of the Corporation, including whether the information will have practical utility;
• Evaluate the accuracy of the agency's estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions used;
• Propose ways to enhance the quality, utility and clarity of the information to be collected; and
• Propose ways to minimize the burden of the collection of information on those who are to respond, including the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology, e.g., permitting electronic submissions of responses.

An ICR document has been submitted to OMB for consideration concerning two forms, each a proposed revision to an earlier OMB-approved form. They are:

(1) The Forbearance Request Form (OMB #3045-0030), and

(2) the Interest Accrual Form (OMB #3045-0053).

These are the documents by which AmeriCorps members first request postponement, during their term of service, of their obligation to make payments on qualified student loans and then access the interest payment benefit that they have earned by successfully completing their service. Both forms are important for AmeriCorps members who have outstanding qualified student loans during their period of national service.

The document was published in the Federal Register on November 14, 2001, for a 60-day pre-clearance public comment period. Only one organization, a loan servicing organization, requested a copy of the document. Four of its suggestions concerning the Interest Accrual Form were incorporated into the version now being presented to OMB for consideration. Three other suggestions were not incorporated, mainly due to space considerations and the Corporation's belief that the time allotted for forwarding the form will not cause undue delay.

Each form will be individually discussed below.

A. Forebearance Request Form

Type of Review: Renewal.

Agency: Corporation for National and Community Service.

Title: Forbearance Request Form.

OMB Number: OMB #3045-0030.

Agency Number: None.

Affected Public: AmeriCorps members and the holders of their qualified student loans.

Total Respondents: 6,500 annually.

Frequency: Average of once per year of national service per loan.

Average Time Per Response: Ten minutes for the AmeriCorps member to complete the form.

Estimated Total Burden Hours: 1083 hours.

Total Burden Cost (capital/startup): None.

Total Burden Cost (operating/maintenance): None.

Description

AmeriCorps members may request a suspension of their obligation to repay most qualified student loans not in default during their service period. The purpose of the forbearance is to accommodate the minimal living allowance they receive while they complete their term of service, although interest continues to accrue during this period.

Currently, AmeriCorps members use an OMB approved form entitled Forbearance Request for National Service to obtain certification that they are in an approved national service position. The form also serves as the borrower's official request to the loan companies for forbearance. Since forbearance is granted by the loan holder and not the Corporation, the form requests of the loan holder that a forbearance be approved for the national service. The Corporation's role is to verify that the borrower is an AmeriCorps member and is eligible for this mandatory forbearance on qualified student loans. An AmeriCorps member completes one part of the form and sends it to the office of the National Service Trust. The Trust provides written verification that the borrower is in an approved national service position, then forwards the form to the loan holder at the address provided by the AmeriCorps member. The loan holder will act upon the request.

This form has been adopted by many of the larger loan holders (e.g., Sallie Mae) and is given to their borrowers with the loan holders' own logos at the top of the form. Indeed, the form was originally developed with the assistance of Sallie Mae and representatives of several student loan associations. Having a separate form for forbearance based on AmeriCorps service clearly distinguishes it from forbearance requests based on one of the other conditions for which a borrower may be eligible (e.g., military service, employment in certain low income areas, student status).

Several other loan holders have chosen to modify their own existing forbearance request forms by including an additional option— “AmeriCorps service” or “national service” —to the choices already available. The Corporation verifies national service participation using all types of forms presented to it, on a loan holder's unique form as well as the OMB approved form.

The form needs some minor revisions to clarify certain sections and to facilitate processing of the information; for example, to add loans made by a state agency to the list of qualified loans, add a statement of purpose to the member's section, identify the service dates as mandatory, limit the form to a single loan holder each, and add the National Service Trust's toll-free number.

The Corporation seeks to continue using this particular form, albeit in a slightly revised version. This is a voluntary form. It is one way to provide verification to a loan holder that one of its borrowers is eligible for the mandatory forbearance, while at the same time allowing the borrower to request the forbearance from the loan company. The Corporation will continue its policy of verifying AmeriCorps participation on any form the loan holder wishes to use. The current form is due to expire March 31, 2002.

Analysis of Comments Received During the Public Comment Period

One comment was received from a loan servicing organization. It concerned the proposed change to require a separate forbearance request form for each lender. It commented favorably that although the change appeared to increase the burden on the borrower it was likely to have the opposite effect. The loan servicer noted that when all loan holders were listed on one form, as before, some loan holders may not have received the form timely or at all; and some of the borrower's loans may have become delinquent as a consequence.

B. Interest Accrual Form

Type of Review: Renewal.

Agency: Corporation for National and Community Service.

Title: Interest Accrual Form.

OMB Number: OMB #3045-0053.

Agency Number: None.

Affected Public: AmeriCorps members and the holders of their qualified student loans.

Total Respondents: 6,500 annually.

Frequency: Average of once per year of national service per loan

Average Time Per Response: 10 minutes, total (three minutes for the AmeriCorps member to complete the form and seven minutes for the loan holder).

Estimated Total Burden Hours: 1083 hours.

Total Burden Cost (capital/startup): None.

Total Burden Cost (operating/maintenance): None.

Description

The Corporation pays all or a portion of the interest that accrues during a period of national service for those who successfully complete their service and have had their loans in forbearance during the service. Using the current form, AmeriCorps members complete the top section and indicate their dates of service. Then they mail the form to the loan holder who indicates the total amount of interest that accrued during the service period, or indicates a daily accrual rate. The loan holder also adds the address where the payment should be sent and returns the form to the National Service Trust. When the Corporation receives this information, it is reviewed for accuracy and is either paid or returned to the loan holder or lender for additional information.

The revisions address the most common causes for delays in processing interest payments. The changes modify the title for consistency, reduce the number of days prior to completion of service for submitting the form, more clearly identify the member's address information, identify the service dates as essential, add loans made by a state agency to the list of qualified loans, request loan type information and if more than one loan is cited request loan numbers, clarify the language regarding grace period information, add to the lender's certification a statement that the loans cited are in forbearance, and add a space for the lender's fax number. The current form is due to expire March 31, 2002.

Analysis of Comments Received During the Public Comment Period

One response was received from a loan servicing organization. It suggested a different wording for the lender's certification and for the identification of a grace period, which wording the Corporation agreed was clearer and incorporated into the form. It objected to changing the daily interest rate from a dollar amount to a percentage as a complication. We agreed, and we also accepted a recommendation to restore the list of examples of qualified student loans.

The loan servicer argued that decreasing the number of days prior to the member's completion date for sending in the form from 90 to 30 could delay payment until some time after the completion of service. In fact, payment cannot be made until the member's education award is in place. The purpose of this change is simply to decrease the number of forms that cannot be processed because the education award has not yet been granted. However, because most awards are now processed electronically much faster than before, we do not expect this change to cause any appreciable delay in making interest payments.

Another comment questioned giving the loan type and payoff amount in the space available, if the borrower has multiple eligible loan types. It was also thought a statement of purpose for this information would be useful. We concur but are constrained by space limitations. With the addition of loans made to members by state agencies, verification of qualified loan types becomes more subject to scrutiny, and a statement of the loan type will facilitate processing of the payment request. Similarly, providing the payoff amount, as is routinely done on the Voucher and Payment Request Form, should help avoid the delays caused by awaiting confirmation of that figure.

Dated: February 7, 2002.

Charlene Dunn,

Director, National Service Trust.