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Notice

Privacy Act of 1974; System of Records

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Start Preamble

AGENCY:

Federal Student Aid, Department of Education.

ACTION:

Notice of a modified system of records.

SUMMARY:

In accordance with the Privacy Act of 1974, as amended (Privacy Act), the Department of Education (Department) modifies the system of records entitled “Common Origination and Disbursement (COD) System” (18-11-02).

The COD System is a system of records about applicants for, and recipients of, a Federal grant or loan under any of the Federal student financial assistance programs authorized under title IV of the Higher Education Act of 1965, as amended (HEA). The Department uses the COD system of records to document origination and disbursement of loans, account for awarded grants, reconcile school cash drawdowns from the U.S. Department of the Treasury to individual student disbursements, and ensure that institutions of higher education participating in the HEA programs receive the appropriate amount of funds during the respective time periods.

DATES:

Submit your comments on or before September 16, 2019.

This modified system of records will become applicable upon publication in the Federal Register on August 16, 2019. New routine use disclosures (1)(i), (1)(j), (1)(k), and 14, and modified routine uses (1)(f), (4)(c), (5)(a), (10), (11), (12), and (13) outlined in the ROUTINE USES OF RECORDS MAINTAINED IN THE SYSTEM, INCLUDING CATEGORIES OF USERS AND PURPOSES OF SUCH USES will become applicable on September 16, 2019, unless the modified system of records notice needs to be changed as a result of public comment. The Department will publish any significant changes resulting from public comment.

ADDRESSES:

Submit your comments through the Federal eRulemaking Portal or via postal mail, commercial delivery, or hand delivery. We will not accept comments submitted by fax or by email or those submitted after the comment period. To ensure that we do not receive duplicate copies, please submit your comments only once. In addition, please include the Docket ID at the top of your comments.

  • Federal eRulemaking Portal: Go to www.regulations.gov to submit your comments electronically. Information on using Regulations.gov, including instructions for accessing agency documents, submitting comments, and viewing the docket, is available on the site under the “help” tab.
  • Postal Mail, Commercial Delivery, or Hand Delivery: If you mail or deliver your comments about this modified system of records, address them to: Director, COD System, Program Management Services, Federal Student Aid (FSA), U.S. Department of Education, Union Center Plaza (UCP), Room 112J2, 830 First Street NE, Washington, DC 20202-5454.

Privacy Note:

The Department's policy is to make all comments received from members of the public available for public viewing in their entirety on the Federal eRulemaking Portal at www.regulations.gov. Therefore, commenters should be careful to include in their comments only information that they wish to make publicly available.

Assistance to Individuals with Disabilities in Reviewing the Rulemaking Record: On request, we will supply an appropriate accommodation or auxiliary aid, to an individual with a disability who needs assistance to review the comments or other documents in the public rulemaking record for this notice. If you want to schedule an appointment for this type of accommodation or auxiliary aid, please contact the person listed under FOR FURTHER INFORMATION CONTACT.

Start Further Info

FOR FURTHER INFORMATION CONTACT:

Margaret M. Glick, Director, COD System, Program Management Services, FSA, U.S. Department of Education, UCP, Room 64E1, 830 First Street NE, Washington, DC 20202-5454. Telephone: (202) 377-4563.

If you use a telecommunications device for the deaf (TDD) or a text telephone (TTY), you may call the Federal Relay Service (FRS) at 1-800-877-8339.

End Further Info End Preamble Start Supplemental Information

SUPPLEMENTARY INFORMATION:

Among other purposes described in this notice, the COD System includes information needed for the Department to administer the Federal grant and loan HEA programs. The COD System contains records associated with Federal grant and loan origination activities under HEA-authorized programs for which the Department provides funds directly to participating institutions of higher education on a student or recipient level. Such activities include establishing an individual's eligibility to receive a Federal grant or loan under these HEA-authorized programs. The system also contains records evidencing the disbursement of program funds by participating institutions of higher education to those individuals whose eligibility has been previously established.

Records maintained in the COD System include information provided by recipients of title IV, HEA program assistance, the legal parents of dependent recipients, endorsers, and the spouses of married, independent student borrowers, and references, as required. The records contain individually identifying information, including, but not limited to: Name, Social Security number (SSN), address, date of birth, email address, and citizenship status. The COD System also assists the Department in administering the title IV Campus Based Programs, which include the Federal Perkins Loan, Federal Supplemental Educational Opportunity Grant (FSEOG), and Federal Work-Study (FWS) Programs.

This notice of a modified system of records for the COD System: Updates the security classification, system locations, and system manager; expands the categories of individuals covered by the system and the categories of records maintained in the system; expands the system's purposes; and updates the current programmatic routine use disclosures needed to carry out the Department's responsibilities under title IV of the HEA. This notice also updates some of the wording of the routine uses in this system of records notice to standardize it with the wording of the same routine uses in many of the Department's other systems of records notices, deletes a standard routine use Start Printed Page 41980that is no longer needed, and adds a new standard routine use that is needed to comply with Office of Management and Budget requirements on data breaches involving personally identifiable information. This notice also updates the policies and practices for the storage of records, the policies and practices for retrieval of records, the policies and procedures for retention and disposal of records, and the record source categories. The Department is also modifying the sections of the notice entitled “RECORD ACCESS PROCEDURES” and “NOTIFICATION PROCEDURES” and is adding a new section entitled “HISTORY.”

The Department is updating the section of the notice entitled “SECURITY CLASSIFICATION” by revising it from “none” to “unclassified” and the section of the notice entitled “SYSTEM LOCATION” by adding additional locations of records, and removing the locations no longer utilized. The Department is changing the section of the notice entitled “SYSTEM MANAGER(S)” to reflect that the Director of the COD System is the system manager.

The Department is updating the section of the notice entitled “PURPOSE(S) OF THE SYSTEM” to expand the system's purposes related to students and borrowers. The Department is adding additional purposes to identify individuals who: Completed a Special Direct Consolidation Loan application and promissory note; completed counseling in the Direct Loan or Teacher Education Assistance for College and Higher Education (TEACH) Grant programs; filed an electronic request to repay a Direct Loan under an income-based or income contingent (hereafter “income-driven”) repayment plan; or filed an electronic Federal Direct Consolidation Loan application and promissory note. The Department also is including an additional purpose to track the level of study, the Classification of Instructional Program (CIP) code (field of study), and the educational program length in which the borrower enrolled to track the limit on eligibility for Direct Subsidized Loans to no more than 150 percent of the published length of the educational program in which the student is enrolled, and to enable Federal Loan Servicers to determine the periods for which a borrower who enrolls after reaching the 150 percent limit will be responsible for the accruing interest on outstanding Direct Subsidized Loans, and also for tracking student enrollments by educational program for purposes of determining educational program outcomes, including using that information to obtain average earnings of students by educational program from another Federal agency.

The Department also is expanding the system's purposes related to institutions of higher education participating in and administering title IV, HEA programs to include assisting an institution of higher education with student loan default prevention and with reconciling its cash drawdowns from the U.S. Department of the Treasury with its reported disbursements and to ensure that the institution receives the appropriate amount of dollars during the respective time period. Also, the Department is revising a purpose to clarify that an institution of higher education can request online credit checks to determine a borrower's eligibility for title IV, HEA Federal Direct PLUS Loans.

The Department also is expanding the system's purposes related to the Department's oversight of title IV, HEA programs to include performing data analytics and reporting to inform and optimize the effectiveness of the Department's student financial assistance programs.

The Department is expanding the section of the notice entitled “CATEGORIES OF INDIVIDUALS COVERED BY THE SYSTEM” to cover individuals who apply for a Federal grant or applied for a loan under the Federal Perkins Loan Program, the Federal Family Education Loan (FFEL) Program, the Federal Insured Student Loan (FISL) Program, the Auxiliary Loans to Assist Students (ALAS) Program, the Health Professions Student Loans (HPSL) Program, and the Health Education Assistance Loan (HEAL) Program. This section also has been expanded to contain student enrollment data on title IV recipients and cohort default rate (CDR) by institution of higher education.

The Department is modifying the section entitled “CATEGORIES OF RECORDS IN THE SYSTEM” to expand the data elements maintained in the system. For individuals who apply for or receive a Federal grant or loan under the programs authorized by title IV of the HEA the Department is now maintaining additional demographic information, including Federal income tax information (tax return status, adjusted gross income, Internal Revenue Service exemptions, and tax year), family size, marital status, and spouse identifiers. For recipients of Direct Loans, FFEL Program loans, Perkins Loans, and FISL Program loans, the Department is expanding borrower loan information to include the period from the origination of the loan through final payment, and milestones, including, but not limited to: Cancellation, consolidation, discharge, or other final disposition including details such as loan amount, disbursements, balances, loan status, repayment plan and related information, collections, claims, deferments, forbearances, and refunds. On Federal grant recipients, the Department is expanding information to include grant amounts, grant awards, verification status, lifetime eligibility used (LEU), Iraq and Afghanistan Service Grant (IASG) eligible veteran's dependent indicator, Children of Fallen Heroes Scholarship eligibility indicator, and Pell over-award indicator.

The Department is further expanding the section entitled “CATEGORIES OF RECORDS IN THE SYSTEM” to include Direct Loan award information; FFEL Loan Program records including demographic and contact information; Pell Grant overpayment collection information; promissory notes, Direct PLUS Loan request, endorser addendum, and confirmation of counseling completion by Direct Loan borrowers and TEACH Grant program recipients; PLUS Loan credit report information; applicant identifier information for an electronic request to repay a Direct Loan under an income-driven repayment plan and endorser/spouse information; Electronic Direct Consolidation Loan applicant identifier information; information concerning the date of any default on a loan; and demographic and contact information for borrower accounts that are assigned to a Federal Loan Servicer(s). This section has also been expanded to include data about students that is provided by institutions of higher education that apply and are accepted by the Department for participation in an experiment under the Experimental Sites Initiatives. Also, this section has been expanded to include data elements that are used to perform data analysis regarding improper payments. Additionally, this section has been expanded to contain records on the level of study, CIP code (field of study), and published length of an educational program in which a student receiving title IV, HEA Federal student aid is enrolled.

An appendix has also been added to the notice detailing the data in this system of records as a result of exchanges of data within FSA.

The section entitled “RECORD SOURCE CATEGORIES” has been updated to include information that is provided by spouses of applicants who request to repay a Direct Loan under an income-driven repayment plan and that is obtained from Federal Direct Start Printed Page 41981Consolidation Loan application forms and promissory notes. Also, the section has been updated to specify that completion information for Direct Loan and TEACH Grant program counseling is received through StudentLoans.gov (the student-facing portion of the website) or from institutions of higher education, or both. The section also has been updated to indicate that the system receives information on PLUS LOAN applicants from credit reporting agencies. The section has been further updated to include other persons or entities from which data is obtained under the routine uses set forth in the system of records notice. Additionally, this section has been updated to include various Privacy Act systems of records notices maintained by the Department that share information with the COD System.

The Department is making a number of changes which expand the current routine use disclosures in the system.

First, the Department is revising programmatic routine use (1)(f) to clarify that an institution of higher education can request online credit checks to determine a borrower's eligibility for title IV, HEA Federal Direct PLUS Loans.

Second, the Department is adding programmatic routine use (1)(i) to allow the Department to disclose records to institutions of higher education as to whether borrowers or students have completed the required counseling in the Direct Loan or TEACH Grant programs to assist institutions of higher education with student loan default prevention.

Third, the Department is adding programmatic routine use (1)(j) to permit the Department to disclose records to guaranty agencies, educational institutions, financial institutions and servicers, and to Federal and State agencies in order to assist the Department in complying with requirements that limit eligibility for Direct Subsidized Loans.

Fourth, the Department is adding programmatic routine use (1)(k) to permit the Department to disclose records to credit reporting agencies to assist the Department with the determination of eligibility for a PLUS Loan.

The Department is deleting prior routine use (3), which was entitled “Disclosure for Use by Other Law Enforcement Agencies,” because Program Management Services within Federal Student Aid (FSA) that is responsible for managing this system of records is not a law enforcement agency. Further, another routine use in this system of records and subsection (b)(7) of the Privacy Act will continue to permit FSA to disclose records for law enforcement purposes provided their conditions are met.

The Department is modifying routine use (4)(c) entitled “Litigation and Alternative Dispute Resolution (ADR) Disclosure” to insert the word “person” in place of the word “individual” to avoid confusion because “individual” is a defined term in the Privacy Act.

The Department is also modifying routine use (5)(a) entitled “Employment, Benefit, and Contracting Disclosure” to add language to describe the records as “civil, criminal, or other relevant enforcement or other pertinent records” that are maintained by a Federal, State, or local agency, or by another public authority or professional organization, to which the Department may disclose records under this routine use if necessary to obtain information in such an agency's or organization's records that would be relevant to a Departmental decision involving personnel actions, the issuance of benefits, or the letting of a contract.

The Department is modifying routine use (10) entitled “Contract Disclosure” and routine use (11) entitled “Research Disclosure” to remove the language therein that had referenced “Privacy Act safeguards.” The Department revised the language in these routine uses to clarify that contractors and researchers to whom disclosures are made under these routine uses will be required to agree to establish and maintain safeguards to protect the security and confidentiality of the disclosed records. With respect to routine use (10), the Department also removed language that had indicated that the Department would require these safeguards “before entering into such a contract” to instead indicate that these safeguards will be required “as part of such a contract.” With respect to routine use (11), the Department also revised this routine use to indicate that an appropriate official of the Department must determine that the individual or organization to which the disclosure would be made is qualified to carry out specific research related to the functions or purposes of the system of records and that the disclosure and research must be consistent with the uses and restrictions set forth in Sections 483(a)(3)(E), 485B(d)(2), and 485B(d)(5)(B) of the HEA, and the Family Educational Rights and Privacy Act, 20 U.S.C. 1232g and 34 CFR part 99.

The Department is modifying routine use (12) to permit the Department to disclose records to the Congressional Budget Office, in addition to the Office of Management and Budget (OMB), as necessary to fulfill the requirements of the Federal Credit Reform Act of 1990, as amended, in accordance with 2 U.S.C. 661b.

Pursuant to the requirements in OMB Memorandum 17-12 entitled “Preparing for and Responding to a Breach of Personally Identifiable Information,” the Department is modifying the routine use (13) entitled “Disclosure in the Course of Responding to a Breach of Data.”

Finally, the Department is adding a new routine use (14) to permit the Department to disclose records from this system, in compliance with the requirements set forth in OMB Memorandum 17-12, to another Federal agency or Federal entity, when the Department determines that information from this system of records is reasonably necessary to assist the recipient agency or entity in (a) responding to a suspected or confirmed breach or (b) preventing, minimizing, or remedying the risk of harm to individuals, the recipient agency or entity (including its information systems, programs, and operations), the Federal Government, or national security, resulting from a suspected or confirmed breach.

The Department is updating the section entitled “POLICIES AND PRACTICES FOR STORAGE OF RECORDS” to include the storage of electronic student demographic, and title IV aid data information for the entire Federal Student Aid lifecycle, from application through loan payoff. The section is also being updated to include the storage of electronic master promissory notes and the hard disk storage of electronic Special Direct Consolidation Loan applications and promissory notes, electronic requests to repay a Direct Loan under an income-driven repayment plan, and Federal Direct Consolidation Loan applications and promissory notes.

The Department is updating the section entitled “POLICIES AND PRACTICES FOR RETENTION AND DISPOSAL OF RECORDS” to explain that the applicable Department records schedule is being amended, pending approval by the National Archives and Records Administration (NARA).

Finally, the Department is modifying the sections entitled “RECORD ACCESS PROCEDURES” and “NOTIFICATION PROCEDURES” to specify the necessary particulars that an individual must provide when making a request for access to or notification of a record. The Department is also adding a new section entitled “HISTORY” in compliance with the requirements in OMB Circular No. A-108.Start Printed Page 41982

Accessible Format: Individuals with disabilities can obtain this document in an accessible format (e.g., braille, large print, audiotape, or compact disc) on request to the person listed under FOR FURTHER INFORMATION CONTACT.

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Start Signature

Dated: August 12, 2019.

Mark A. Brown,

Chief Operating Officer, Federal Student Aid.

End Signature

For the reasons discussed in the preamble, the Chief Operating Officer, Federal Student Aid of the U.S. Department of Education (Department) publishes a notice of a modified system of records to read as follows:

SYSTEM NAME AND NUMBER:

Common Origination and Disbursement (COD) System (18-11-02).

SECURITY CLASSIFICATION:

Unclassified.

SYSTEM LOCATION:

Program Management Services, Federal Student Aid (FSA), U.S. Department of Education (Department), Union Center Plaza (UCP), Room 64E1, 830 First Street NE, Washington, DC 20202-5454.

Amazon Web Services (AWS), 1200 12th Ave., Suite 1200, Seattle, WA 98114. (This is the Computer Center for the COD application, where all electronic COD information is processed and stored.) This information includes data about individuals who completed counseling required by the William D. Ford Federal Direct Loan (Direct Loan) and the Teacher Education Assistance for College and Higher Education (TEACH) Grant programs, and who apply for or receive a Federal grant or loan under one of the programs authorized by title IV of the Higher Education Act of 1965, as amended (HEA), including, but not limited to: The Direct Loan Program, the Federal Family Education Loan (FFEL) Program, the Campus-Based Programs (Federal Perkins Loans, Federal Work Study, and Federal Supplemental Education Opportunity Grants (FSEOG)), the Federal Pell Grant Program, the Academic Competitiveness Grant (ACG) Program, the National Science and Mathematics Access to Retain Talent (National SMART) Grant Program, the TEACH Grant Program, the Iraq and Afghanistan Service Grant (IASG) Program, the Federal Insured Student Loan (FISL) Program, the Auxiliary Loans to Assist Students (ALAS) Program, the Health Profession Student Loans (HPSL) Program, and the Health Education Assistance Loans (HEAL) Program. Also included are: Direct Loan electronic promissory notes, TEACH Agreement to Serve (ATS) documents, PLUS Loan endorser addendums, Special Direct Consolidation Loan applications and promissory notes, electronic requests to repay a Direct Loan under an income-driven repayment plan, Federal Direct Consolidation Loan application and promissory notes, student enrollment information which includes dates and statuses (i.e., full-time or part-time).

Accenture, 22451 Shaw Road, Sterling, VA 20166-4319. (The COD Sterling Cloud-based Operations is located here.)

Accenture DC, 810 First Street NE, Washington, DC 20202-4227. (This is the COD Operations Center.)

Atlanta Federal Records Center, National Archives and Records Administration (NARA), 4712 Southpark Blvd., Ellenwood, GA 30294. (This is where master promissory notes (MPN), Endorser Addenda, and Power of Attorney documents are stored.)

The following five listings are the locations of the COD Customer Service Centers:

ASM Research 2429 Military Road, Suite 200, Niagara Falls, NY 14304-1551. (This center images and stores all of the Direct Loan paper Master Promissory Notes (MPNs) and Endorser Addenda);

Senture, LLC, 4255 W Highway 90 Monticello, KY 42633-3398;

Senture, LLC 460 Industrial Blvd., London, KY 40741-7285;

Cooney Solutions Group, 8415 Datapoint Drive, San Antonio, Texas 78229-3298; and

Veteran Call Center, 53 Knightsbridge Rd., Suite 201, Piscataway, NJ 08854-3925.

SYSTEM MANAGER(S):

Director, COD System, Program Management Services, Federal Student Aid (FSA), U.S. Department of Education (Department), Union Center Plaza (UCP), Room 64E1, 830 First Street NE, Washington, DC 20202-5454.

AUTHORITY FOR MAINTENANCE OF THE SYSTEM:

This system of records is authorized under title IV of the HEA, 20 U.S.C. 1070 et seq.

PURPOSE(S) OF THE SYSTEM:

The information contained in this system is maintained for the following purposes related to students and borrowers:

(1) To determine recipient eligibility and benefits under the title IV, HEA programs;

(2) To store electronic data and documentation, including promissory notes and other agreements, that evidence the existence of a legal obligation to repay funds disbursed under the title IV, HEA programs;

(3) To identify whether an individual may have received a title IV, HEA Federal grant or loan at more than one educational institution for the same enrollment period in violation of the title IV program regulations;

(4) To identify whether an individual may have exceeded the annual award limits under title IV, HEA Federal grant or loan programs in violation of title IV program regulations;

(5) To identify an individual who completed a Special Direct Consolidation Loan application and promissory note;

(6) To identify an individual who completed counseling in the Direct Loan or TEACH Grant programs;

(7) To identify an individual who completed an electronic request to repay a Direct Loan under an income-based or income contingent (hereafter “income-driven”) repayment plan;

(8) To identify an individual who completed an electronic Federal Direct Consolidation Loan application and promissory note; and

(9) To track the level of study, Classification of Instructional Program (CIP) code (field of study), and educational program length to limit eligibility for Direct Subsidized Loans to no more than 150 percent of the published length of the educational program in which the student is enrolled, to enable Federal Loan Servicers to determine the periods for which a borrower who enrolls after reaching the 150 percent limit will be responsible for the accruing interest on outstanding Direct Subsidized Loans, and also for tracking student Start Printed Page 41983enrollments by educational program for purposes of determining educational program outcomes, including using that information to obtain average earnings of students by educational program from another Federal agency.

The information in this system is also maintained for the following purposes relating to institutions of higher education participating in and administering title IV, HEA programs:

(1) To enable an institution of higher education to reconcile, on an aggregate and recipient-level basis, the amount of title IV, HEA Federal grant and Direct Loan funds that an institution received for disbursements it made to, or on behalf of, eligible students (including reconciling verification codes, reconciling the funds received with disbursements made by type of funds received, and making necessary adjustments);

(2) To enable an institution of higher education to request online credit checks to determine the eligibility of a borrower for title IV, HEA Federal Direct PLUS Loans;

(3) To assist an institution of higher education, a software vendor, or a third-party servicer with questions about a title IV, HEA Federal grant or loan;

(4) To assist an institution of higher education with student loan default prevention; and

(5) To reconcile an institution of higher education's cash drawdowns from the U.S. Department of the Treasury with its reported disbursements and to ensure that the institution of higher education receives the appropriate amount of funds during the respective time period.

The information in this system is also maintained for the following purposes relating to the Department's oversight of title IV, HEA programs:

(1) To support the investigation of possible fraud and abuse and to detect and prevent fraud and abuse in the title IV, HEA Federal grant and loan programs;

(2) To confirm that an institution of higher education, or a program offered by an institution of higher education, is eligible to receive title IV, HEA program funds;

(3) To set and adjust program funding authorization levels for each institution;

(4) To enforce institutional compliance with Department reporting deadlines;

(5) To apply appropriate title IV, HEA funding controls; and

(6) To perform data analytics and reporting to inform and optimize the effectiveness of the Department's student financial assistance programs.

CATEGORIES OF INDIVIDUALS COVERED BY THE SYSTEM:

This system contains records of individuals who apply for a Federal grant or loan under one of the programs authorized under title IV of the HEA, including, but not limited to the: (1) Federal Pell Grant Program; (2) Federal Perkins Loans Program; (3) ACG Program; (4) National SMART Grant Program; (5) TEACH Grant Program; (6) Iraq and Afghanistan Service Grant Program; (7) Direct Loan Program, which includes Federal Direct Stafford/Ford Loans, Federal Direct Unsubsidized Stafford/Ford Loans and Federal Direct PLUS Loans and Federal Direct Consolidation Loans; (8) FFEL Program; (9) FISL Program; (10) ALAS Program; (11) HPSL Program; and (12) the HEAL Program.

The COD System also contains records of individuals who are title IV recipients and are currently or were previously enrolled at an institution of higher education, and cohort default rates (CDR) by institution of higher education.

CATEGORIES OF RECORDS IN THE SYSTEM:

Records in the COD System include, but are not limited to, the following data about individuals who apply for or receive a Federal grant or loan under one of the programs authorized under title IV of the HEA:

(1) Identifier information, including name, Social Security number (SSN), and date of birth (DOB);

(2) Demographic information, including address, email address, driver's license number, telephone number, citizenship status, dependency status, estimated family contribution, cost of attendance, postsecondary school identifier, Federal income tax information (tax return status, adjusted gross income, Internal Revenue Service exemptions, and tax year), family size, marital status, spousal identifiers, and enrollment information;

(3) Borrowers' loan(s) information including information about recipients of Direct Loan, FFEL program loans, Perkins Loans, and FISL program loans. This includes the period from the origination of the loan through final payment, and milestones, including, but not limited to: Cancellation, consolidation, discharge, or other final disposition including details such as loan amount, disbursements, balances, loan status, repayment plan and related information, collections, claims, deferments, forbearances, and refunds;

(4) Information about students receiving Federal grants, including recipients of Pell Grants, ACG, National SMART Grants, TEACH Grants, Iraq and Afghanistan Service Grants, and including grant amounts, grant awards, verification status, lifetime eligibility used (LEU), IASG eligible veteran's dependent indicator, Children of Fallen Heroes Scholarship eligibility indicator, and the Pell Grant over-award indicator;

(5) Direct Loan awards. This includes loan amounts and dates of disbursements;

(6) FFEL Loan program records including demographic and contact information from the guaranty agency that guarantees the borrower's FFEL loan(s) and the lender(s), holder(s), and servicer(s) of the borrower's loan(s);

(7) Pell Grant overpayment collection information;

(8) Direct Loan promissory notes including promissory note identification numbers, loan type, current servicer, principal balance, and the accrued interest of Direct Loans or Department-held FFEL Loans;

(9) TEACH Agreements to Serve;

(10) Promissory notes, Direct Loan Entrance Counseling forms, Federal Student Loan Exit Counseling forms, PLUS Loan Counseling forms, Direct PLUS Loan Requests, endorser addendums, and counseling in the Direct Loan and TEACH Grant programs, such as the date that applicant completed counseling;

(11) PLUS Loan credit report information;

(12) Applicant identifier information for an electronic request to repay a Direct Loan under an income-driven repayment plan and endorser/spouse information, such as the SSN, date that applicant completed the income-driven repayment plan application, and current loan balances;

(13) Electronic Direct Consolidation Loan borrower identifier information, such as the borrower's SSN, the date that borrower completed the Federal Direct Consolidation Loan application and promissory note, and current loan balances;

(14) Information concerning the date of any default on a loan;

(15) Demographic and contact information for borrower accounts that are assigned to the Federal Loan Servicer(s) for collection of the borrower's title IV, HEA loans.

The system also contains the following data about students provided by institutions of higher education that participate in an experiment under the Experimental Sites Initiative: award year, experiment number, Office of Postsecondary Education identification number (OPEID), student SSN, student last name, and any data collection instrument elements authorized under Start Printed Page 41984the Information Collection Request associated with each experiment.

In addition to identifying and demographic information listed above the following data elements that are used to perform data analysis regarding improper payments: Internal Identifier (ID), Email Modified Date, Flag for Email Verified, Email Verified Date, Challenge Question/Answers (CQA), Password, Notes, Security universally unique identifier (UUID), Social Security Administration Match, Quarantined Status, Language Preference, Account Disabled by FSA, Account Disabled by User, PAS Suspect Activity Flag, Date CQA becomes unlocked, Keys for Verification, Short Message Service (SMS) Opted In Status, Flag for SMS Verified, SMS Verified Date, Date User Accepted Disclaimer, Event ID, Session ID, Event Type, User UUID, App ID, Referrer App ID, Uniform Resource Locator (URL), Referrer URL, Authentication Flag, Remote internet Protocol (IP) address, Client IP address, User Agent String, Timestamp, WebSEAL Version, UUID, Authorization Token, Challenge Question 1, Response 1, Challenge Question 2, Response 2, Challenge Question 3, Response 3, Challenge Question 4, Response 4, Challenge Question 5, Response 5, and Created Time.

The system also contains records on the level of study, CIP code (field of study), and published length of an educational program in which a student receiving title IV, HEA Federal student aid is enrolled to assist the Department in enforcing the limit on the borrower's eligibility for Direct Subsidized Loans to no more than 150 percent of the published length of the educational program in which the student is enrolled, and to determine the periods for which a borrower who enrolls after reaching the 150 percent limit will be responsible for the accruing interest on outstanding Direct Subsidized Loans.

The Appendix contains a detailed description of the data added to this system of records as a result of the exchanges of data within FSA.

RECORD SOURCE CATEGORIES:

This system includes records on individuals who have received title IV, HEA program assistance. These records include information provided by recipients of title IV, HEA program assistance, the parents of dependent recipients, spouses of applicants who request to repay a Direct Loan under an income-driven repayment plan, and from Federal Direct Consolidation Loan application forms and promissory notes. This system also includes Federal grant and Direct Loan origination and disbursement records provided to the Department by institutions of higher education or their agents. The system also receives completion information for Direct Loan and TEACH Grant program counseling through StudentLoans.gov (the student-facing portion of the website) or from institutions of higher education, or both.

The system also receives information on PLUS Loan applicants from credit reporting agencies.

The Central Processing System (CPS) (covered by the Department's Privacy Act of 1974, as amended (Privacy Act) system of records notice entitled “Federal Student Aid Application File” (18-11-01)) electronically sends the COD System the Demographic Data Exchange (DDE) file to validate all CPS-processed Free Application for Federal Student Aid (FAFSA) records with the Federal grant and Direct Loan disbursement data processed through the COD System.

The National Student Loan Data System (NSLDS) (covered by the Department's Privacy Act system of records notice entitled “National Student Loan Data System” (18-11-06)) electronically sends the COD System student aid data for the Special Direct Consolidation Loan borrowers, Financial Awareness Counseling, the income-driven repayment plan application processed through the COD System, the Federal Direct Loan Consolidation Loan application and promissory notes, and the data to perform analytics and reporting to inform and optimize the effectiveness of the Department's student financial assistance programs.

The Financial Management System (FMS) (covered by the Department's Privacy Act system of records notice entitled “Financial Management System (FMS)” (18-11-17)) sends the COD System funding information at the institutional level, refunds of cash, and reallocation information.

The Postsecondary Education Participants System (PEPS) (covered by the Department's Privacy Act system of records notice entitled “Postsecondary Education Participants System (PEPS)” (18-11-09)) sends the COD System school demographic information.

The Common Services for Borrowers system (CSB) (covered by the Privacy Act system of records notice entitled “Common Services for Borrowers (CSB)” (18-11-16)) sends the COD System discharge information, payments to servicer data, and payments on grant overpayments that are being serviced by FSA's Default Division.

The system may also obtain information from other persons or entities from which data is obtained under routine uses set forth below.

ROUTINE USES OF RECORDS MAINTAINED IN THE SYSTEM, INCLUDING CATEGORIES OF USES AND PURPOSES OF SUCH USES:

The Department may disclose information contained in a record in this system of records under the routine uses listed in this system of records without the consent of the individual if the disclosure is compatible with the purposes for which the record was collected. The Department may make these disclosures on a case-by-case basis or, if the Department has complied with the computer matching requirements of the Privacy Act, under a computer matching agreement.

(1) Program Disclosures. The Department may disclose records from the system of records for the following program purposes:

(a) To verify the identity of the recipient involved or the accuracy of the record, or to assist with the determination of program eligibility and benefits, the Department may disclose records to institutions of higher education, financial institutions, third-party servicers, and Federal, State, or local agencies;

(b) To store electronic data that supports the existence of a legal obligation to repay funds disbursed under title IV, HEA programs, including documentation such as promissory notes and other agreements, the Department may disclose records to institutions of higher education, third-party servicers, and Federal agencies;

(c) To identify whether an individual may have received a title IV, HEA Federal grant or loan at more than one institution of higher education for the same enrollment period in violation of title IV, HEA regulations, the Department may disclose records to institutions of higher education, third-party servicers, and Federal, State, or local agencies;

(d) To identify whether an individual may have exceeded the annual award limits under the title IV, HEA Federal grant or Direct Loan programs in violation of title IV, HEA regulations, the Department may disclose records to institutions of higher education, third-party servicers, and Federal agencies;

(e) To enable institutions of higher education to reconcile, on an aggregate and recipient-level basis, the amount of title IV, HEA Federal grant and Direct Loan funds that an institution received with the disbursements it made to, or on behalf of, eligible students (including reconciling verification codes, Start Printed Page 41985reconciling the funds received with disbursements made by type of funds received, and making necessary corrections and adjustments), the Department may disclose records to institutions of higher education, third-party servicers, and Federal, State, or local agencies;

(f) To enable an institution of higher education to request online credit checks to determine the eligibility of applicants or borrowers for a title IV, HEA Federal Direct PLUS Loan, disclosures may be made to institutions of higher education, third-party servicers, credit reporting agencies, and Federal agencies;

(g) To assist individuals, institutions of higher education, third-party servicers, or software vendors with questions about a title IV, HEA Federal grant or loan, disclosures may be made to institutions of higher education, software vendors, third-party servicers, and Federal, State, or local agencies;

(h) To support the investigation of possible fraud and abuse and to detect and prevent fraud and abuse in title IV, HEA Federal grant and loan programs, disclosures may be made to institutions of higher education, third-party servicers, and Federal, State, or local agencies;

(i) To assist institutions of higher education with student loan default prevention, disclosures may be made to institutions of higher education as to whether a borrower or student has completed required counseling in the Direct Loan or TEACH Grant programs;

(j) To assist the Department in complying with requirements that limit eligibility for Direct Subsidized Loans to no more than 150 percent of the published length of the educational program in which the student is enrolled, and to determine when a borrower who enrolls after reaching the 150 percent limit will be responsible for the interest accruing on outstanding Direct Subsidized Loans thereafter, the Department may disclose records to guaranty agencies, educational institutions, financial institutions and servicers, and to Federal and State agencies; and

(k) To assist the Department in determining eligibility for a PLUS Loan, disclosures may be made to credit reporting agencies.

(2) Congressional Member Disclosure. The Department may disclose the records of an individual to a member of Congress or the member's staff when necessary to respond to an inquiry from the member made at the written request of that individual. The member's right to the information is no greater than the right of the individual who requested it.

(3) Enforcement Disclosure. If information in this system of records indicates, either on its face or in connection with other information, a violation or potential violation of any applicable statute, regulation, or order of a competent authority, the Department may disclose the relevant records to the appropriate agency, whether foreign, Federal, State, tribal, or local, charged with investigating or prosecuting that violation or charged with enforcing or implementing the statute, regulation, or order issued pursuant thereto.

(4) Litigation and Alternative Dispute Resolution (ADR) Disclosure.

(a) Introduction. In the event that one of the following parties listed in sub-paragraphs (i) through (v) is involved in judicial or administrative litigation or ADR, or has an interest in judicial or administrative litigation or ADR, the Department may disclose certain records from this system of records to the parties described in paragraphs (b), (c), and (d) of this routine use under the conditions specified in those paragraphs:

(i) The Department or any of its components;

(ii) Any Department employee in his or her official capacity;

(iii) Any Department employee in his or her individual capacity if the Department of Justice (DOJ) has been requested to or has agreed to provide or arrange for representation of the employee;

(iv) Any Department employee in his or her individual capacity when the Department has agreed to represent the employee;

(v) The United States when the Department determines that the litigation is likely to affect the Department or any of its components.

(b) Disclosure to the DOJ. If the Department determines that disclosure of certain records to the DOJ is relevant and necessary to judicial or administrative litigation or ADR, the Department may disclose those records as a routine use to the DOJ.

(c) Adjudicative Disclosure. If the Department determines that it is relevant and necessary to litigation or ADR to disclose certain records from this system of records to an adjudicative body before which the Department is authorized to appear or to a person or an entity designated by the Department or otherwise empowered to resolve or mediate disputes, the Department may disclose those records as a routine use to the adjudicative body, person, or entity.

(d) Disclosure to Parties, Counsel, Representatives, and Witnesses. If the Department determines that disclosure of certain records to a party, counsel, representative, or witness is relevant and necessary to the judicial or administrative litigation or ADR, the Department may disclose those records as a routine use to the party, counsel, representative, or witness.

(5) Employment, Benefit, and Contracting Disclosure.

(a) For Decisions by the Department. The Department may disclose information from this system of records to a Federal, State, or local agency, or to another public authority or professional organization, maintaining civil, criminal, or other relevant enforcement or other pertinent records, if necessary to obtain information relevant to a Department decision concerning the hiring or retention of an employee or other personnel action; the issuance of a security clearance; the letting of a contract; or the issuance of a license, grant, or other benefit.

(b) For Decisions by Other Public Agencies and Professional Organizations. The Department may disclose records to a Federal, State, local, or foreign agency or other public authority or professional organization, in connection with the hiring or retention of an employee or other personnel action; the issuance of a security clearance; the reporting of an investigation of an employee; the letting of a contract; or the issuance of a license, grant, or other benefit, to the extent that the record is relevant and necessary to the receiving entity's decision on the matter.

(6) Employee Grievance, Complaint, or Conduct Disclosure. If a record is relevant and necessary to a grievance, complaint, or disciplinary proceeding involving a present or former employee of the Department, the Department may disclose the record in the course of investigation, fact-finding, or adjudication to any party to the grievance, complaint, or action; to the party's counsel or representative; to a witness; or to a designated fact-finder, mediator, or other person designated to resolve issues or decide the matter. The disclosure may only be made during the course of investigation, fact-finding, or adjudication.

(7) Labor Organization Disclosure. The Department may disclose a record to an arbitrator to resolve disputes under a negotiated grievance procedure or to officials of a labor organization recognized under 5 U.S.C. chapter 71 when relevant and necessary to their duties of exclusive representation.

(8) Freedom of Information Act (FOIA) and Privacy Act Advice Disclosure. The Department may Start Printed Page 41986disclose records to the DOJ or the Office of Management and Budget (OMB) if the Department concludes that disclosure is desirable or necessary in determining whether particular records are required to be disclosed under the FOIA or the Privacy Act.

(9) Disclosure to the DOJ. The Department may disclose records to the DOJ to the extent necessary for obtaining DOJ advice on any matter relevant to an audit, inspection, or other inquiry related to the programs covered by this system.

(10) Contract Disclosure. If the Department contracts with an entity to perform any function that requires disclosure of records in this system to employees of the contractor, the Department may disclose the records to those employees. As part of such a contract, the Department shall require the contractor to agree to establish and maintain safeguards to protect the security and confidentiality of the disclosed records.

(11) Research Disclosure. The Department may disclose records to a researcher if an appropriate official of the Department determines that the individual or organization to which the disclosure would be made is qualified to carry out specific research related to the functions or purposes of this system of records, provided that such disclosure and research is consistent with the uses and restrictions set forth in Sections 483(a)(3)(E), 485B(d)(2), and 485B(d)(5)(B) of the HEA, and the Family Educational Rights and Privacy Act, 20 U.S.C. 1232g and 34 CFR part 99. The Department may disclose records from this system of records to that researcher solely for the purpose of carrying out that research related to the functions or purposes of this system of records. The researcher shall be required to agree to establish and maintain safeguards to protect the security and confidentiality of the disclosed records.

(12) Disclosure to OMB and the Congressional Budget Office (CBO) for Federal Credit Reform Act (CRA) Support. The Department may disclose records to OMB and CBO as necessary to fulfill CRA requirements in accordance with 2 U.S.C. 661b.

(13) Disclosure in the Course of Responding to a Breach of Data. The Department may disclose records from this system of records to appropriate agencies, entities, and persons when (a) the Department suspects or has confirmed that there has been a breach of the system of records; (b) the Department has determined that as a result of the suspected or confirmed breach, there is a risk of harm to individuals, the Department (including its information systems, programs, and operations), the Federal government, or national security; and (c) the disclosure made to such agencies, entities, and persons is reasonably necessary to assist in connection with the Department's efforts to respond to the suspected or confirmed breach or to prevent, minimize, or remedy such harm.

(14) Disclosure in Assisting another Agency in Responding to a Breach of Data. The Department may disclose records from this system to another Federal agency or Federal entity, when the Department determines that information from this system of records is reasonably necessary to assist the recipient agency or entity in (a) responding to a suspected or confirmed breach or (b) preventing, minimizing, or remedying the risk of harm to individuals, the recipient agency or entity (including its information systems, programs, and operations), the Federal Government, or national security, resulting from a suspected or confirmed breach.

DISCLOSURE TO CONSUMER REPORTING AGENCIES:

Disclosures pursuant to 5 U.S.C. 552a(b)(12): The Department may disclose to a consumer reporting agency the following information regarding a valid, overdue claim of the Department: (1) The name, address, taxpayer identification number, and other information necessary to establish the identity of the individual responsible for the claim; (2) the amount, status, and history of the claim; and (3) the program under which the claim arose. The Department may disclose the information specified in this paragraph under 5 U.S.C. 552a(b)(12) and the procedures contained in 31 U.S.C. 3711(e). A consumer reporting agency to which these disclosures may be made is defined at 15 U.S.C. 1681a(f) and 31 U.S.C. 3701(a)(3).

POLICIES AND PRACTICES FOR STORAGE OF RECORDS:

The Department electronically stores, for the entire Federal Student Aid lifecycle from application through loan payoff, student demographic, and title IV, HEA aid data information such as, but not limited to, FFEL program, FISL program, and Perkins aid records, on hard disk at AWS Data Center in Seattle, Washington. The Department stores electronic master promissory notes, electronic Special Direct Consolidation Loan opportunity applications and promissory notes, electronic requests to repay a Direct Loan under an income-driven repayment plan, and Federal Direct Consolidation Loan applications and promissory notes on hard disk at the AWS Data Center in Seattle, Washington. Paper Direct Loan promissory notes and endorser addendums are stored in locked vaults in ASM Research in Niagara Falls, New York and at the NARA-operated Atlanta Federal Records Center near Atlanta, Georgia. Data obtained from the paper promissory notes are stored on hard disks at the AWS Data Center in Seattle, Washington. This data is referred to as metadata and is used by the system to link promissory notes to borrower data. The Department also creates and stores electronic images of the paper promissory notes at the ASM Research facility in Niagara Falls, New York. For information on the storage of other documents see paragraph entitled “SYSTEM LOCATIONS”.

POLICIES AND PRACTICES FOR RETRIEVAL OF RECORDS:

Records in the COD System are retrieved by the individual's SSN or name, or by the institution's OPEID.

POLICIES AND PRACTICES FOR RETENTION AND DISPOSAL OF RECORDS:

All records are retained and disposed of in accordance with Department Records Schedule 072: FSA Application, Origination, and Disbursement Records (DAA-0441-2013-0002) (ED 072). ED 072 is being amended, pending approval by NARA. Records will not be destroyed until NARA-approved amendments to ED 072 are in effect, as applicable.

ADMINISTRATIVE, TECHNICAL, AND PHYSICAL SAFEGUARDS:

Physical access to the sites of the Department's contractors, where this system of records is maintained, is controlled and monitored by security personnel who check each individual entering the buildings for his or her employee or visitor badge.

In accordance with the Department's Administrative Communications System Directive OM: 5-101 entitled “Contractor Employee Personnel Security Screenings,” all contract and Department personnel who have facility access and system access must undergo a security clearance investigation. Individuals requiring access to Privacy Act data are required to hold, at a minimum, a moderate-risk security clearance level. These individuals are required to undergo periodic screening at five-year intervals.

In addition to undergoing security clearances, contract and Department employees are required to complete security awareness training on an annual basis. Annual security awareness Start Printed Page 41987training is required to ensure that contract and Department users are appropriately trained in safeguarding Privacy Act data.

The computer system employed by the Department offers a high degree of resistance to tampering and circumvention. This security system limits data access to Department and contract staff on a “need-to-know” basis and controls individual users' ability to access and alter records within the system. All users of this system of records are given unique user identification. The Department's FSA Information Security and Privacy Policy require the enforcement of a complex password policy. In addition to the enforcement of the complex password policy, users are required to change their password at least every 90 days in accordance with the Department's information technology standards.

RECORD ACCESS PROCEDURES:

If you wish to gain access to a record in this system, contact the system manager at the address listed above. You must provide necessary particulars of your name, DOB, SSN, and any other identifying information requested by the Department while processing the request to distinguish between individuals with the same name. Requests by an individual for access to a record must meet the requirements in 34 CFR 5b.5.

CONTESTING RECORD PROCEDURES:

If you wish to contest the content of your personal record within the system of records, contact the system manager at the address listed above and provide your name, DOB, and SSN. Identify the specific items to be changed, and provide a written justification for the change. Requests to amend a record must meet the requirements in 34 CFR 5b.7.

NOTIFICATION PROCEDURES:

If you wish to determine whether a record exists regarding you in the system of records, contact the system manager at the address listed above. You must provide necessary particulars such as your name, DOB, SSN, and any other identifying information requested by the Department while processing the request to distinguish between individuals with the same name. Requests must meet the requirements in 34 CFR 5b.5.

EXEMPTIONS PROMULGATED FOR THE SYSTEM:

None.

HISTORY:

The most recent notice modifying the COD system of records was published in the Federal Register on September 27, 2010 (75 FR 59242-59246). The Department renamed the system of records entitled “Recipient Financial Management System” (RFMS) as the “Common Origination and Disbursement (COD) System” on September 27, 2010. The Department previously published the RFMS system of records notice on June 4, 1999 (64 FR 30106, 30161-30162).

Appendix to 18-11-02

The following is a detailed description of the data added to the COD system of records as a result of the exchanges of data within FSA:

The COD System receives applicant data from the Department's CPS system each time an application is processed or corrected. This process assesses student aid eligibility, updates financial aid history, and ensures compliance with title IV, HEA regulations. Some of these data appear on the applicant's Student Aid Report and the Institutional Student Information Record. Federal Perkins Loan data and FSEOG overpayment data are sent from postsecondary institutions or their third-party servicers. The Department's COD System obtains school demographic information from the PEPS system.

The COD System receives booking acknowledgements, discharge information, and payments to servicer data from Federal Loan Servicers.

The COD System receives payment information from the CSB system on title IV, HEA grant overpayments that are being serviced by FSA's Default Division. This payment information assesses student aid eligibility, updates financial aid history, and ensures compliance with title IV, HEA regulations.

The FMS system provides funding information at the institution level, refunds of cash, and reallocation information.

End Supplemental Information

[FR Doc. 2019-17615 Filed 8-15-19; 8:45 am]

BILLING CODE 4000-01-P