Federal Advisory – Department of Justice Activity and FUTURE Act

January 24, 2020

Proposed Final Judgment from the U.S. Department of Justice

The following is an update outlining federal activity pertaining to actions taken by the Department of Justice (DOJ) regarding alleged antitrust violations, an issue last brought to your attention by NASD in a notice sent on October 9, 2019 entitled, Recent Federal Activities of Note and Importance.

As a reminder, on September 28, 2019, in response to concerns held by the DOJ regarding potential antitrust violations, delegates at the Annual Conference of NACAC voted to remove three provisions from the NACAC Code of Ethics and Professional Practices. The provisions, the removal of which was intended to prevent litigation by the DOJ, addressed the solicitation of transfer applications from prior prospective students unless a student initiated the transfer process, exclusive incentives for students making applications through early decision processes, and the recruitment of undergraduate students already committed to other institutions.

On December 12, 2019, the DOJ announced that it had filed a civil lawsuit against NACAC alleging that NACAC created limitations and restrictions on the ability of its member institutions to recruit students. As anticipated, the DOJ’s Antitrust Division simultaneously issued a consent decree that would resolve the Antitrust Division’s concerns. The consent decree functions as an agreement with NACAC that would require the Association to delete the three noted provisions from its Code and prevent NACAC from establishing any similar rules in the future.

As required by the Tunney Act, this proposed judgment and decree, as well as a competitive impact statement, was published in the Federal Register on January 10, 2020. It is important to note that the DOJ is required to provide a public comment period regarding the information posted in the Federal Register to ensure that the proposed judgment is in the public interest. Comments are due no later than Thursday, March 11, 2020 and should be sent to Aaron Hoag, Chief of the Technology and Financial Services Section of the Antitrust Division, U.S. Department of Justice, 450 Fifth Street, N.W., Suite 7100, Washington, D.C., 20530. The Antitrust Division website also provides summary information and the ability to provide formal comment by email.

NASD recommends careful consideration of the preceding information including the potential impact it may have on institutions and their students, and recommends that it be shared with offices within your institution. Individuals wishing to submit comment may seek guidance and information directly from the staff of the United States Department of Justice.

Reauthorization Activities Regarding the Higher Education Act

On May 2, 2019, House Democrats introduced a bill (H.R.2486) intending to fund Historically Black Colleges and Universities (HBCU) and Minority Serving Institutions (MSI) for Fiscal Year 2020, entitled Fostering Undergraduate Talent by Unlocking Resources for Education (FUTURE) Act. This bill was passed by the House on September 17, 2019, but delayed in the Senate given a desire for significant changes. On December 5, 2019, the Senate returned the bill to the House with various amendments necessitating House review and approval. Given the extensive nature of the changes, the bill was reintroduced as H.R.5363 with the same title as the previously introduced bill. Following generally bipartisan approval in the House and Senate, the bill was passed into public law on December 19, 2019. It is important to note that this bill reauthorizes portions of the Higher Education Act of 1964.

In addition to the permanent authorization of funding for HBCUs and MSIs, the bill stipulates requirements for the disclosure of personal tax-return information deemed necessary to carry out the provisions of the Higher Education Act. The provisions of the bill are intended to simplify the verification of income processes for federal student aid applications and recertifications for income-contingent or income-based repayment plans of student loans. Of particular note among these provisions is the permission this bill grants to the Internal Revenue Service to share applicant tax information directly with the U.S. Department of Education, and as a condition of eligibility for various repayment plans, the requirement of the applicant to affirmatively approve the disclosure agreement between the Internal Revenue Service and the U.S. Department of Education. It is recommended that readers review all provisions of the FUTURE Act.

NASD will continue to monitor these ongoing activities and provide updates as they become available and as appropriate. It is strongly recommended that institutions remain abreast of relevant legislative and federal issues, and vigilant in their efforts to develop clear and cogent understandings of federal policies and initiatives. Again, and as always, please feel free to share this information with appropriate offices within your institution.

Thank you for your continuing efforts.