Authority: Public Health Service (PHS) Act, Title VIII, Section 846A, as amended by the Nurse Reinvestment Act of 2002, Public Law 107-205.

PUBLIC BURDEN STATEMENT: According to the Paperwork Reduction Act of 1995, an agency may not conduct or sponsor, and a person is not required to respond to a collection of information unless it displays a currently valid OMB control number. The OMB control number for this project is 0915-0060. The time required to complete this information collection is estimated to average 56.25 hours per response, including the time for reviewing instructions, searching existing data sources, gathering and maintaining the data needed, and completing and reviewing the collection of information. Send comments regarding this burden estimate or any other aspect of this collection of information, including suggestions for reducing this burden to HRSA Reports Clearance Officer, 5600 Fishers Lane, 14A-11, Rockville, Maryland, 20857.

I. EXECUTIVE SUMMARY

Legislative Authority

The Nurse Faculty Loan Program (NFLP) is authorized under Title VIII, Section 846A of the Public Health Service Act, as amended by the Nurse Reinvestment Act of 2002, to increase the number of qualified nursing faculty. The institution must enter into an agreement with the Department of Health and Human Services (HHS), Health Resources and Services Administration (HRSA) to establish and operate the NFLP fund.

Purpose

HHS makes an award to the institution (hereafter referred to as the School) in the form of a Federal Capital Contribution (FCC). The School uses the FCC to establish a distinct account called the NFLP fund. The NFLP fund must provide for loans made to students enrolled full-time in an eligible advanced degree program in nursing (master's or doctoral) at the School. Loan recipients must complete the education program, and following graduation, may cancel up to 85% of the NFLP loan while serving as full-time nurse faculty at a school of nursing (i.e. baccalaureate or higher degree, associate degree or diploma schools of nursing).

General Information

This application guidance is an overview of the criteria for the School's participation, the mechanisms that HHS uses to award Federal dollars for the NFLP, general administration instruction, and the NFLP fund management requirements for participating Schools.

This application guidance has been revised for fiscal year (FY) 2006. Continuing NFLP participants should reference this guidance for current/updated program guidelines to assist with program administration.

II. AWARD INFORMATION

Type of Award

Funding will be provided in the form of a Federal Capital Contribution (FCC) award to establish an NFLP fund or to deposit an award into an existing NFLP fund. The NFLP is awarded annually. The award covers the period specified in the Notice of Award (NOA) to the School.

Cost Sharing

In addition to the FCC award, Schools must contribute an Institutional Capital Contribution (ICC) amount equal to at least one-ninth of the total FCC award. The ICC must be deposited and used as part of the NFLP fund.

Award Determination

The award amount to each school is determined by calculating the tuition plus a base amount for books/fees that is multiplied by the number of continuing NFLP students and a set number of new students requesting NFLP support. This calculation is used to expend the total program funds among the eligible applicants.

The projected date for award determinations will be August 1, 2006.

III. ELIGIBILITY CRITERIA FOR APPLICANT SCHOOLS

Only accredited collegiate schools of nursing are eligible to apply for NFLP awards. Another department within the institution, such as a Graduate School of Arts and Sciences that offers an eligible advanced nursing education program, may submit an NFLP application; however, the graduate degree must be in nursing.

The school of nursing must offer a master's and/or doctoral degree program(s) in nursing for full-time students. The advanced education nursing program(s) must include an education component to prepare graduates to serve as faculty in a school of nursing. The education component may consist of education courses, preceptor and/or supervised teaching practica identified within the curriculum.

IMPORTANT NOTE: Post-Nursing Master's Certificate programs are NOT eligible.

Location of the School of Nursing

The nursing school must be located in a State, the District of Columbia, the Commonwealth of Puerto Rico, the Northern Mariana Islands, the Virgin Islands, Guam, American Samoa or the Trust Territory of the Pacific.

Accreditation

The applicant school of nursing must provide documentation of the accreditation status (Accrediting Body, Accreditation Status/Date) when the application is submitted. A new graduate program of nursing that is not accredited at the time of submission of a grant application, by reason of an insufficient period of operation, but eligible for accreditation by a recognized body or bodies or State agency, is eligible to apply for funding if the Secretary of Education finds, after consultation with the appropriate accrediting body or bodies, that there is reasonable assurance that the program will meet the accreditation standards of such body or bodies prior to the beginning of the academic year following the normal graduation date of students of the first entering class.

IV. APPLICATION SUBMISSION

Application Deadline

The NFLP application must be submitted by the School of Nursing to HRSA's Division of Nursing on or before the deadline date of April 28, 2006. Applicants should keep a copy of the submitted application for their records.

Applications MUST BE POSTMARKED by April 28, 2006 by 5:00 P.M. E.T. Applications will be considered as meeting the deadline if they are either (1) received on or before the deadline date; or (2) postmarked on or before the deadline date and received in time for orderly processing. A legibly dated receipt from a commercial carrier or U.S. Postal Service will be accepted in lieu of a postmark. Private metered postmarks shall not be accepted as proof of timely mailing.

Late Applications

Applications that do not meet the criteria above are considered late applications. HRSA shall notify each late applicant that its application will not be considered in the current application cycle.

Submission of Application Material

Applicants should mail or deliver the completed and signed original of the application material and one legible/readable/reproducible copy, in one package, to the address below.

Send the original and one copy of the application to:

Division of Nursing (NFLP)
Bureau of Health Professions
Health Resources and Services Administration
Parklawn Building, Room 9-36
5600 Fishers Lane
Rockville, MD 20857

Data Universal Numbering System (DUNS)

All applicant organizations are required to have a Data Universal Numbering System (DUNS) numbering system in order to apply for funding from the Federal Government. The DUNS number is a unique nine-character identification number provided by the commercial company, Dun and Bradstreet. There is no charge to obtain a DUNS number. Information about obtaining a DUNS number can be found at http://www.hrsa.gov/grants/preview/dunsccr.htm or call 1-866-705-5711. Please include the DUNS number on the application face page. Applications will not be reviewed without a DUNS number.

Additionally, the applicant organization will be required to register with the Federal Government's Central Contractor Registry (CCR) in order to do business with the Federal Government, including electronic. Information about registering with the CCR can be found at http://www.hrsa.gov/grants/preview/dunsccr.htm.

Application Format Guidelines

Compliance with the following instructions supports consistent formatting from all applicants. An applicant's failure to comply with these instructions may jeopardize the review of their application.

• Applications must be submitted in English and typed on 8 ½ x 11-inch plain white paper.
• Applications must not exceed 20 pages including program summary, agreement and appendices. Applications that exceed the page limit will be rejected.
• Margins must be at least one (1) inch at the top, bottom, right and left of the paper.
• The text portion of the application must be submitted in 12 point Arial or 12 point Times New Roman font, and single line spacing.
• Size and type standards apply only to the sections of the application normally prepared by applicants. Applicants will not be held responsible for items prepared by entities over which it has no control (e.g., letters of recommendation and support, biographical sketches, and appendices).
• The application must be numbered sequentially from page 1 (face page) to the end of the application, including the appendices. Pages must be numbered using whole numbers only; use of alphas or decimals such as 3A or 3.1, etc are not acceptable.
• Pages must be one-sided.
• All application materials should be prepared in black and white.

V. TECHNICAL ASSISTANCE

The following Division of Nursing staff can provide general program information and technical assistance on the Nurse Faculty Loan Program and may be reached at 301-443-6333 or by e-mail:

• Ms. Denise Thompson, Program Analyst, dthompson@hrsa.gov
• Ms. Nancy V. Douglas-Kersellius, Public Health Analyst, ndouglas@hrsa.gov
• Dr. Patricia Calico, Branch Chief, pcalico@hrsa.gov

* Primary contacts for the Nurse Faculty Loan Program

Potential applicants are encouraged to contact the Division of Nursing staff prior to the deadline date for submission of the application.

VI. PROGRAM SUMMARY

All applicants must submit the following Program Summary information in the format provided in the NFLP Guidance in Word and the NFLP Guidance in pdf. Incomplete information may jeopardize the application review and award decision.

VII. 2006 AGREEMENT WITH HHS FOR PARTICIPATION IN THE NFLP

Establishment of Agreement

The School must enter into a yearly agreement with HHS to establish and operate a NFLP fund according to the terms and conditions for participating in the NFLP. The applicant school of nursing must submit a signed copy of this agreement with the signed Application Face Page (Form HRSA-6025-1). See ATTACHMENT 1 for a copy of the agreement. When HHS makes an award to the School, the agreement will be signed and returned to the School. When the HHS and the School both sign the agreement, it will be binding on both parties.

Federal Non-Discrimination, Assurances, Certifications and Other Requirements

In return for the award of Federal funds, the School accepts the obligation to comply with applicable Federal nondiscrimination, assurances, certifications and other requirements cited in Section J of the attached agreement.

VIII. AWARD NOTIFICATION

HHS will send a Notice of Award (NOA) to the School indicating the amount of the FCC award and a copy of the agreement that bears both signatures of HHS and the authorized official at the School to the Financial Aid Office Coordinator and the School of Nursing Coordinator.

Drawing Down the FCC

The School will receive the FCC award via electronic funds transfer. The HHS Payment Management System (PMS) will establish an account for the new Schools awarded. For general information on how to access funds through the drawdown process, please contact the PMS Application Support Group at (877) 614-5533 or (301) 443-1660; or http://www.dpm.psc.gov/.

Schools are requested to draw down the full amount of the FY 2006 award (in whole dollars) from the PMS to be deposited into NFLP loan fund established at the School. Schools are encouraged to draw down the entire award by March 31, 2007. Schools are expected to expend the full amount of the 2006 award during the current academic year (2006-2007).

Expected ICC

The School must contribute an ICC in the NFLP fund equal to at least one-ninth (minimum) of the FCC award. The School has the option of contributing a larger share to the NFLP fund.

IX. ROLE OF SCHOOL OFFICIALS

We encourage the School of Nursing Coordinator and Financial Aid Office Coordinator at the institution to discuss and decide their roles in administering the NFLP prior to submitting the application. Communication between the coordinators must be maintained to properly monitor the status of NFLP recipients.

Role of the School of Nursing

The school of nursing is the eligible applicant. Therefore, the school of nursing, not the financial aid office or other administrative unit, must submit the NFLP application. The school of nursing should notify the financial aid office of its intent to apply for an NFLP award and work with the financial aid office on activities such as, but not limited to, advising potential NFLP recipients and submitting required reports.
Role of the Financial Aid Office

The financial aid office generally administers the NFLP fund (i.e., issuing the Promissory Note and verifying employment status, repayment/cancellation schedules and collections following graduation).
The financial aid office should work with the school of nursing on activities such as, but not limited to, advising potential NFLP recipients and submitting required reports.

The School must notify HRSA, Division of Nursing of any change in the Financial Aid Office Coordinator or School of Nursing Coordinator using EXHIBIT A in the Word NFLP Guidance and PDF NFLP Guidance.

X. OVERVIEW OF INSTITUTIONAL MANAGEMENT OF FUNDS

The NFLP agreement requires the school of nursing to establish and operate the NFLP fund. This section offers a brief introduction to the management of the NFLP fund. For additional information, see the HRSA Fiscal Management web site at http://bhpr.hrsa.gov/dsa/sfag/Financial_Management/financial_management.html.

IMPORTANT NOTE: Please be aware that the HRSA Fiscal Management web site provides general guidance and procedures for other HHS programs that are similar to the NFLP. The specific requirements for the NFLP may differ (i.e. repayment periods, cancellation provisions, service obligation requirements, exhibits). Applicant Schools should contact the Division of Nursing staff for any clarification (See Section V of this guidance).

Annual Operating Report

The Annual Operating Report (AOR) is used to monitor and evaluate institutional performance. The AOR is the official reporting tool and is required by NFLP schools. The School must complete and submit the NFLP AOR (EXHIBIT B-1) annually. Instructions for completing the AOR are provided in EXHIBIT B-2. Both Exhibits are included in the Word NFLP Guidance and the PDF NFLP Guidance.

The AOR is used to report expenditures for the NFLP fund annually, which covers the period from
July 1st through June 30th each year. The AOR must be completed and submitted to the Division of Nursing by July 31st each year. The AOR should be mailed to the address under Section IV of this guidance.

Cash Balances and Excess Cash

The balance in the NFLP fund must be reported annually on the AOR for the specified reporting period. Schools are permitted to retain unused funds in the NFLP fund for future use. Unused funds must be recorded each year as excess cash on the Annual Operating Report. The excess cash will be monitored yearly. If a school is determined to have significant excess cash by the third year of the program, the award may be adjusted to reflect an offset.

Schools should review the balance in the NFLP fund on at least a semi-annual basis to determine whether the fund balance, compared with projected levels of expenditures and collections, exceeds its needs. Refer to Collections under the Fiscal Management web site for information about cash balances and excess cash.

Reporting of NFLP Loan Disbursements

The PMS is administered by the Division of Payment Management, Financial Management Services, Program Support Center. PMS requires schools to complete and submit the quarterly PMS Form 272 to report NFLP loan disbursements.

Cancellation Payments by HHS

When a School cancels all or any part of a loan or interest, the Secretary of HHS will pay to the School an amount equal to the School's proportionate share of the cancelled portion, as determined by the Secretary.

Write-Off Procedures

Schools must adhere to the policies and procedures for write off review of uncollectible loans. If a School writes off a loan, it retains the authority to collect the loan if collection is possible at a later time. The School must notify the Division of Nursing through the reporting process of subsequent collections on loans approved for write off. For more guidance on write-off procedures, see Collections under the Fiscal Management web site.

Institutional Termination and Withdrawal

Upon withdrawal or termination of institutional participation in the program, the balance in the NFLP fund will be distributed between the HHS and the School in proportion to the amounts contributed by each. Schools must remit the Federal Government's proportionate share of amounts received thereafter in payment of loan collections and any other earnings on a quarterly basis. At the time of each quarterly remittance, the School should withdraw its proportionate share of the quarterly cash accumulation from the fund. See Collections under the Fiscal Management web site for a description of procedures for remittance of collections. Remittance checks must:

• be made payable to the HHS;
• include the CAN# 3760333, the School's entity identification number, the assigned OPSID Number, and the PMS Payee Account Number; and
• be mailed to:
  Department of Health and Human Services
  Division of Payment Management
  P.O. Box 6021
  Rockville, Maryland 20852

Schools must forward a copy of the remittance documentation to the NFLP Project Officer in the Division of Nursing.

XI. FORMS FOR INSTITUTIONAL USE

With the exception of the Annual Operating Report (EXHIBIT B) and the Promissory Note (EXHIBIT C), schools may use the sample documents listed below (included in the Word NFLP Guidance and the PDF NFLP Guidance or create its own forms.

EXHIBIT A Notification of Change in Contact Personnel
EXHIBIT B-1 NFLP Annual Operating Report (Amended as of 2/2006)
EXHIBIT B-2 Instructions for Completing the Annual Operating Report
EXHIBIT C NFLP Promissory Note
EXHIBIT D Statement Rights and Responsibilities
EXHIBIT E NFLP Loan Application
EXHIBIT F Certification of Employment Form
EXHIBIT G NFLP Request for Partial Cancellation
EXHIBIT H Disability Checklist
EXHIBIT I NFLP Request for Postponement of Installment Payment
EXHIBIT J NFLP Deferment Form
EXHIBIT K Exit Interview ' Questionnaire
EXHIBIT L Forbearance Request Form

XII. STUDENT ELIGIBILITY

Schools must ensure that students meet the eligibility criteria to receive NFLP loans and, among other responsibilities: verify the accuracy of applicant information; assess information to determine individual loans to students; disburse funds; ensure that students maintain full-time status while receiving NFLP loan; and maintain student records.

Citizenship Status

A student applicant must be a citizen or national of the United States, or a lawful permanent resident of the United States, the Commonwealth of Puerto Rico, the Northern Mariana Islands, the Virgin Islands, Guam, American Samoa or the Trust Territory of the Pacific. A student who is in the United States on a student or visitor's visa is NOT eligible for an NFLP loan.

Enrollment Status

Students who receive a NFLP loan must be enrolled full-time in an eligible program at the time the NFLP loan is established and must complete the education component(s) to prepare qualified nurse faculty. The School will define a full-time course of study for an academic year as recorded by the Registrar's office. Students must maintain full-time enrollment status for a minimum of 2 terms/semesters during an academic year while receiving the NFLP loan. NOTE: Post-Nursing Master's Certificate programs are NOT eligible.

Temporary leave from the advanced nurse education program that is approved by the school of nursing is not considered to be a breach of the NFLP Promissory Note by the borrower. Examples of temporary leave include:

• a period up to 3 years during which the borrower is ordered to active duty as a member of a uniformed service of the United States (Army, Navy, Marine Corps, Air Force, Coast Guard, the National Oceanic and Atmospheric Administration Corps, or the U.S. Public Health Service Corps). This does NOT include a borrower who either voluntarily joins a uniformed service or is employed by one of the uniformed services in a civilian capacity; and
• family and medical leave as described in the Family and Medical Leave Act of 1993 (FMLA) (5 U.S.C. 6381-6387; 5 CFR part 630, subpart L). See http://www.opm.gov/index.asp for additional information.

Academic Status

The student must be in good academic standing, as defined by the School, and capable, in the opinion of the School, of maintaining good academic standing in the course of study. Schools may choose to apply the satisfactory academic progress guidelines for programs under Title IV of the Higher Education Act. If an NFLP borrower ceases to be a student in good academic standing, the School must stop disbursement of the NFLP loan.

Default on Other Federal Loans

According to Federal law, a student is ineligible to receive a NFLP loan if a judgment lien has been entered against him/her based on the default on a Federal debt, 28 U.S.C. 3201(e).

XIII. NFLP SUPPORT TO STUDENTS

Full Support to Students

The School should offer full support or the amount requested by the student to cover the full or partial tuition/fees for the academic year. NLFP loans should be made on a first-come-first-serve basis for an academic year until funds are expended. Full support includes the cost of tuition, fees, books, laboratory expenses and other reasonable education expenses. IMPORTANT NOTE: NFLP loans do NOT include stipend support (i.e., living expenses, student transportation cost, room/board, personal expenses).

Prior to making a loan, the School should determine whether the student will enroll full-time for a minimum of 2 terms/semesters (i.e. Fall, Spring) during the academic year. Students are permitted to complete a second term/semester during the summer session, as allowed by the School to meet the 2-term requirement.

Maximum Amount of NFLP Loan(s) to Students

NFLP loans to a student may not exceed $30,000 for an academic year. Schools should inform a loan recipient that, subject to the availability of funds and the recipient maintaining good academic standing, the NFLP loan will be made annually for the period required to complete the course of study, not to exceed 5 years. Students who remain enrolled beyond 5 years may not receive additional NFLP support.

The NFLP is not a need-based program. IMPORTANT NOTE: FAFSA data and other financial records are not required to determine eligibility for the NFLP. Although the FAFSA form is not a NFLP requirement, schools can use the form to confirm U.S. citizenship and non-defaulting status on federal loans.

The NFLP loan(s) made to a recipient is not transferable to another School. The student may transfer to another participating NFLP school and request NFLP loan support; however, the cumulative total should not exceed the maximum of $30,000 per academic year, not to exceed 5 years support.

Multiple Program Support to Students

Students may receive support under both the NFLP and the Advanced Education Nurse Traineeship program, or any other Federal program, provided that the funds are not used to cover the same costs during the academic year. For example, tuition support can be provided under the NFLP, while stipend support (which is not covered under NFLP) can be provided under the Advanced Education Nursing Traineeship Program.

XIV. DISBURSEMENT OF NFLP LOANS TO STUDENTS

A. ENTRANCE INTERVIEW

The School must conduct and document an entrance interview for each academic year during which the student receives the NFLP loan. The School is not required to conduct an entrance interview each time a student receives a disbursement within a single academic year; however, many schools have found requiring a borrower to complete a new "borrower information" form at the time of each disbursement to be useful in the collections process.

Documentation

Schools are responsible for distributing NFLP applications to students. EXHIBIT E (in the Word NFLP Guidance and PDF NFLP Guidance) is the NFLP Loan Application that is completed during the entrance interview. The NFLP loan application must contain sufficient information for the School to determine if the student meets the eligibility criteria for the program and to assist the School in the loan collection process, if necessary, after the student leaves the School.

The School must document that the student is informed of the service obligation associated with the cancellation of the loan. See Collections under the Fiscal Management web site for entrance interview requirements.

No matter what format or method the School uses to conduct an entrance interview, it must document that the borrower is aware of the rights and responsibilities associated with the NFLP loan. The School may use a:

• Separate statement listing the borrower's rights and responsibilities (EXHIBIT D in the Word NFLP Guidance and PDF NFLP Guidance) which the borrower must sign and date to acknowledge that he or she has been provided the information; or
• Statement of the borrower's rights and responsibilities that is incorporated into a disclosure document.

The School must document entrance interviews by maintaining the papers signed by the borrower in his/her file. Documentation consists of evidence that the borrower:

• is aware of his /her rights and responsibilities; and
• has provided information to aid in skip tracing, if needed

The School has discretion in deciding which office (e.g., financial aid, fiscal, loan collection, Dean's) will be responsible for entrance interviews.

Student Records

The School must maintain an individual file for each NFLP loan recipient and maintain these records for at least three years after the loan is retired. This file should contain clear evidence of how the School evaluated each application for financial assistance. Even if no funds were awarded, the School must retain evidence of rejection, cancellation, or declination for the same period of time.

The student file should contain documents relating to each academic year application so that each application cycle is complete and auditable. Student files must, at a minimum, include the types of documents that support this information, which include:

• approved student applications;
• loan notification letter--institutional copy;
• copy of signed Promissory Note(s);
• signed disclosure (i.e., Statement of Borrower's Rights and Responsibilities);
• records of payments and cancellation; and
• records of deferment, forbearance, or default.

HHS permits the School to maintain their records in a variety of formats at the option of the School. Record keeping formats include:

• computer;
• electronic;
• microfiche;
• microfilm; or
• paper.

For information on maintenance of records, see Accounting under the Fiscal Management web site at http://bhpr.hrsa.gov/dsa/sfag/financial_management/bk3prt1.htm.

B. NFLP PROMISSORY NOTE

Each NFLP loan made to the student must be documented by a Promissory Note which describes the terms and conditions of the loan (EXHIBIT C in the Word NFLP Guidance and PDF NFLP Guidance). The borrower must sign the Promissory Note prior to disbursement of loan funds for the academic year. EXHIBIT C is a sample copy of the open-end Promissory Note for Schools to maintain a single Note signed each time a student receives a loan advance. However, Schools are permitted to use a closed-end Promissory Note to maintain a separate Note for a specific period each time a student receives a loan advance. The loan amounts advanced to the students for the combined academic period(s) of NFLP support should be combined for repayment of the total of loans made to a student. The School must give the borrower an updated copy of the Note.

IMPORTANT NOTE: Modification of the Promissory Note requires prior approval by HRSA.

Any change in the statute that affects the terms of the Promissory Note requires that a new Promissory Note be signed for future loans. The Promissory Note is the legal document that binds the student to his/her repayment obligations. The School must ensure that the Promissory Note is complete, legible and signed. The Promissory Note is a major asset and the School must adequately safeguard it against fire, theft, and tampering. The particular method of insuring this protection is the School's responsibility.

Payments to Students

The School determines the number and the amount of loans disbursed to the student. However, NFLP loans may not exceed what the School determines is necessary for the student to pay for any academic year (e.g., semesters, terms, or quarters). The School may advance payments directly to the student or it may credit the disbursement to the student's tuition account. In either case, payments must be clearly documented. The School must stop disbursement to the NFLP recipient if the borrower:

• changes their enrollment status to less than full-time;
• withdraws from the institution;
• fails to meet the academic standards of the institution; or
• requests to terminate NFLP participation

Loan Notification Letter to Students

After the School has determined individual NFLP loans, it must send a loan notification letter to each student. The letter should provide a space for the student to accept or reject the NFLP loan. Duplicate copies of the letter should be provided so that the student can retain one copy and return the original copy to the School.

C. TERMS AND CONDITIONS OF NFLP LOANS TO STUDENTS

Completion of Nursing Education Program

The NFLP recipient must agree to the terms and conditions of the NFLP loan as specified in the Promissory Note signed by the student. The student must be enrolled full-time for a minimum of 2 terms/semesters per academic year and complete the nursing education program.

Employment Status

The NFLP borrower must submit certification of employment to the lending School within a reasonable timeframe as determined by the School, but no later than 12 months following graduation. A sample certification of employment form is provided as EXHIBIT F in the Word NFLP Guidance and PDF NFLP Guidance. At a minimum, the certification of employment must state the date the NFLP recipient began full-time employment as nurse faculty in accordance with the terms of the NFLP Promissory Note and must be signed and dated by the recipient. The recipient is responsible for submitting certification of employment to the lending School in order to determine the interest rate applicable to the unpaid loan balance.

NFLP borrowers are limited to a 12-month timeframe to establish employment as full time nurse faculty at a school of nursing following graduation from the program. If employment verification is not submitted within the 12-month period, the borrower will NOT be eligible for the NFLP loan cancellation provision.

XV. CANCELLATION PROVISION

The NFLP is a direct loan program with a cancellation provision for recipients of the loan. Section 846A of the Public Health Service Act authorizes the lending School to cancel up to 85% of the NFLP loan. The borrower must serve as full-time nurse faculty for a consecutive four-year period at a school of nursing following graduation from the program to cancel the maximum amount of the loan.

The borrower may cancel:

• 20% of the principal and the interest on the amount of the unpaid loan balance upon completion of each of the first, second, and third year of full-time employment; and
• 25% the principal of and the interest on the amount of the unpaid loan balance upon completion of the fourth year of full-time employment.

Example 1:
If the borrower is employed as full-time nurse faculty for 4 consecutive years following graduation from the program, the principal and interest on the unpaid balance of the loan will be cancelled at the end of each year; 20% for the first, second and third year and 25% for the fourth. The lending School must establish a repayment schedule for the borrower to begin repayment of remaining unpaid principal and interest.

Example 2:
If a borrower is employed full-time as nurse faculty for 2 consecutive years following graduation and ceases employment in the third year, 20% of the unpaid principal and interest will be cancelled at the end of the first and second year; however, the borrower may NOT request cancellation of unpaid principal and interest in the third year. The lending School must establish a repayment schedule and the borrower must begin repayment of the remaining unpaid principal and interest on the first day after the last date of employment at the prevailing market rate.

The Promissory Note, which specifies the terms and conditions of the NFLP loan, binds the student to his/her repayment obligation and states the provisions for loan cancellation.

The borrower is responsible for requesting cancellation. After the end of each complete year of employment, the borrower must submit a NFLP Request for Partial Cancellation Form (See below).

A. NFLP REQUEST FOR POSTPONEMENT OF INSTALLMENT PAYMENTS FORM

When a borrower is employed full-time as a faculty at a school of nursing and will request partial cancellation of the loan at the end of each complete year of employment, the borrower may obtain a postponement of installment payments on the loan. The borrower may submit the Request for Postponement of Installment Payment Form (EXHIBIT I in the Word NFLP Guidance and PDF NFLP Guidance) 30 days before the 9-month grace period ends. The borrower must submit the Request for Postponement of Installment Payment form for each period of cancellation and submit each subsequent form 30 days before the expiration date of the previous request for postponement. The form requires the borrower to:

a) complete Part I;
b) obtain certification by the employing school of nursing, Part II; and
c) forward the original and one copy to the lending School.

The School must notify the borrower of the approval of the Request for Postponement of Installment Payment and retain the form in the borrower's file. The lending School must maintain current loan accounts for the borrower documenting any periods of postponement of payments.

The borrower must notify the lending School of termination of full-time employment as faculty prior to completion of a year within 30 days after the last day of such employment, and the lending School must then place the borrower back into repayment with installment payment(s) payable to the lending School according to the borrower's repayment schedule.

B. NFLP REQUEST FOR PARTIAL LOAN CANCELLATION FORM

Borrowers may request PARTIAL loan cancellation each year while employed as full-time nurse faculty at a school of nursing over a consecutive 4-year period. If the Borrower takes a break from
full-time employment during the year, the borrower is not eligible for loan cancellation and must begin repayment of the NFLP loan immediately. To receive loan cancellation, the Borrower must submit the Request for Partial Cancellation of Loan Form (EXHIBIT G in the Word NFLP Guidance and PDF NFLP Guidance) to the lending School at the end of each complete year of full-time employment as faculty at a school of nursing. This form requires the borrower to:

a) complete Part I;
b) obtain certification by the employing school of nursing to complete Part II; and
c) forward the original and one copy to the lending School for cancellation of loan at the appropriate rate in lieu of payment.

The lending School will complete Part III indicating the amount of cancellation (and interest) and return a copy to the borrower as the receipt that it approved the loan cancellation.

Leave During Employment

Paid or unpaid leave, such as under the Family Leave Act, is not considered a "break in employment". This includes paid and unpaid leave for pregnancy and childbirth or for care of an adopted child. Paid or unpaid leave needs to be consistent with the institution's policy and is subject to supervisory approval.

Changing Employment

A reasonable period of time to change from one place of employment to another does not constitute a break in employment. A reasonable period of time is not more than 15 working days or 21 consecutive calendar days from the date the borrower's resignation is effective.

Change of Name or Address

The borrower is required to inform the lending School of any change of name or address after ceasing to be a student at the school or nursing. The borrower must also inform the lending School of any change of name or address during the repayment period.

Refunds

Refunds to borrowers for errors made by lending School must come from institutional funds, not the NFLP fund.

XVI. REPAYMENT PROVISION

Grace Period

The grace period for NFLP loan repayment is 9 months. Neither interest nor is payable during the 9-month grace period.

Repayment Period

The initial repayment period for an NFLP loan begins following a 9-month grace period after the borrower ceases to be a full-time student in the advanced nurse education program.

NFLP borrowers who cease to pursue the advanced education nursing program full-time or choose to voluntarily terminate from the program must begin repayment of the NFLP loan following the 9-month grace period.

Following graduation from the program, NFLP borrowers who fail to establish employment as full-time nurse faculty at a school of nursing must begin repayment of the NFLP loan following the 9-month grace period.

The unpaid loan balance is repayable in equal or graduated periodic installments over a 10-year repayment period. Installment payments must be made no less often than quarterly, in equal or graduated installments, in accordance with the terms of the schedule provided by the lending School and agreed to by the borrower. Refer to Collections under the Fiscal Management web site as a resource for establishing repayment schedules.

Repayment Schedule

If the borrower ceases to pursue the advanced education nursing program full-time or chooses to voluntarily terminate from the program, a loan is repayable in equal or graduated periodic installments over a 10-year period that begins 9 months after the individual ceases to pursue a course of study at the school of nursing.

If the borrower is not employed full-time as nurse faculty at a school of nursing following graduation, a loan is repayable in equal or graduated periodic installments over a 10-year period that begins 9 months after the individual completes the course of study at the school of nursing.

If the borrower's NFLP loan has been cancelled for the maximum portion (up to 85%) of the principal amount of the loan and interest, the remaining amount (15% or more depending upon years of employment) of the unpaid loan balance is repayable in equal or graduated periodic installments over the remaining six years of the repayment period.

Refer to Collections under the Fiscal Management web site as a resource for institutional responsibility in establishing repayment schedules.

Combining NFLP Loans

When a borrower has more than one NFLP loan outstanding, the sum of the amounts loaned must be combined for repayment purposes.

Prepayment

The borrower may, at his or her option and without penalty, prepay all or any part of the principal and accrued interest at any time. If an accelerated payment is made, that prepayment must first be applied to any accrued interest and then to the principal balance.

XVII. INTEREST

The NFLP loan bears interest on the unpaid balance at the rate of 3% per annum beginning 3 months after the borrower ceases to be a full-time student in the advanced nurse education program. Borrowers employed as full-time nurse faculty at a school of nursing for a consecutive four-year period will bear interest at the rate of 3% for the four-year period and the remaining six years of the repayment period.

If the lending School determines that the borrower will either fail to complete the course of study or fail to establish full-time employment as faculty following graduation from the program, the loan will bear interest on the unpaid balance at the prevailing market rate.

The prevailing market rate is determined by the Treasury Department and is published quarterly in the Federal Register. The rates are fixed. Refer to the HHS, Office of Finance web site at http://www.hhs.gov/of/library/policy/debt/ratememo/memorates.html for information on the "consumer interest rates.

IMPORTANT NOTE: The borrower is responsible for submitting verification of employment to the lending School in order to determine the interest rate applicable to the unpaid loan balance.

XVIII. DEATH AND DISABILITY

Death

Upon the death of a borrower, the School must submit documentation to the Division of Nursing (NFLP), Parklawn Building, Room 9-36, 5600 Fishers Lane, Rockville, Maryland 20857. The School retains the documentation in the borrower's file for audit purposes. The School must report the amount of the loan cancelled on its Annual Operating Report. HHS will cancel the unpaid balance of the NFLP loan and accrued interest of a loan upon submission to the School of a death certificate or other official proof of death of the borrower. The School will be formally notified of the Secretary's decision and must retain the written notification of the decision on file for audit and other review purposes.

Permanent and Total Disability

A borrower may be entitled to cancellation of any remaining payment of the NFLP loan in the event of permanent and total disability. Permanent and total disability is defined as unable to engage in gainful employment of any kind because of a medically determined impairment that is expected to continue for a long and indefinite period of time or to result in death. The Secretary of HHS or his designee will make this determination based on medical certification submitted by the borrower supporting the borrower's disability and will cancel the NFLP loan upon approval.

To claim cancellation for disability, a borrower must submit a formal request to the lending School that awarded the loan along with the following documentation:

• date entered and date graduated or date studies terminated;
• total amount of loans obtained;
• amount of unpaid balance;
• nature and date of onset of the disability;
• employment history prior to disability;
• statement of financial support; and
• current medical examination and/or treatment.

The medical report must be sufficiently detailed to provide for a comprehensive review to determine the nature, duration, and extent of the impairment and prognosis. Supporting documentation must include history of illness, medical examination(s), inpatient and outpatient treatments, current medications, and copies of all pertinent past medical records and a prognosis and rehabilitation plan. A signed and dated statement must accompany the medical documentation from the borrower's physician documenting permanent and total disability according to the definition above. The lending School must obtain from the borrower consent for release of information allowing the release of any required information on the disability to the HHS. The School will be formally notified of the Secretary's decision and must retain the written notification of the decision on file for audit and other review purposes. The School must report the amount of the loan cancelled on its Annual Operating Report.

IMPORTANT NOTE: The lending School does not have the authority to cancel loans based on permanent and total disability. This authority remains with HHS.

The School must submit documentation of disability to the Division of Nursing (NFLP), Parklawn Building, Room 9-36, 5600 Fishers Lane, Rockville, Maryland 20857. A disability checklist is provided as EXHIBIT H in the Word NFLP Guidance and PDF NFLP Guidancefor the School in obtaining the required documentation to submit claims for permanent and total disability. This checklist should not be used in lieu of obtaining the required documentation described above.

XIX. DEFERMENT OF LOAN REPAYMENT

Deferment options under the Nurse Faculty Loan Program are limited.

Borrowers who are ordered to active duty as a member of a uniformed service of the United States (Army, Navy, Marine Corps, Air Force, Coast Guard, the National Oceanic and Atmospheric Administration Corps, or the U.S. Public Health Service Commissioned Corps) are eligible for deferment for up to 3 years.

A borrower who voluntarily joins a uniformed service is not eligible for deferment, nor is a borrower who is employed by one of the uniformed services in a civilian capacity.

The School may not put a borrower into deferment status unless the borrower submits a deferment request form (EXHIBIT J in the Word NFLP Guidance and PDF NFLP Guidance). Deferments are not automatic. Borrowers must file deferment forms for each period of deferment and request deferments at least 30 days before the beginning of:

• the activity that makes the borrower eligible for deferment; or
• the repayment period (i.e., the due date of the first payment) if the borrower is beginning the activity during the grace period.

Deferment periods are excluded from the 10-year repayment period. For example, a borrower who has used three years of deferments still has a total of 10 years not 7 years to repay the NFLP loan.

The borrower is responsible for informing the lending School of the end of the deferment period, and the School is responsible for placing the borrower back in repayment following the end of the deferment.

IMPORTANT NOTE: NFLP borrowers accepting a fellowship after graduation are NOT eligible for loan cancellation or deferment.

XX. FORBEARANCE

A lending School may, based on its discretion, place a borrower's NFLP loan in forbearance when extraordinary circumstances such as poor health or hardships temporarily affect the borrower's ability to make scheduled loan repayments. Forbearance is limited to situations in which the borrower clearly intends to repay the NFLP loan obligation but is temporarily unable to comply with the existing repayment schedule. See Collections under the Fiscal Management web site for additional information on forbearance.

During periods of forbearance, the borrower's obligation to make payments on interest and principal may be either reduced or eliminated. Interest on the loan continues to accrue but is not payable during this period.

A borrower must request forbearance by submitting a completed Request for Forbearance form (EXHIBIT L in the Word NFLP Guidance and PDF NFLP Guidance) to the School. The School must notify the borrower in writing of its approval or denial of the forbearance request and document that decision in the borrower's file.

Forbearance periods may be up to 6 months each. A School may grant a borrower no more than 2 forbearance periods without seeking the prior approval of HHS. Periods of forbearance are not excluded from the borrower's 10-year repayment period.

XXI. INSTITUTIONAL RESPONSIBILITY IN REPAYMENT PROCESS

See Collection under the Fiscal Management web site for information on accounting requirements, debt collection requirements (e.g., due diligence), cash management requirements, program monitoring and audits.

Exit Interview

The School must conduct and document an exit interview with its borrowers (individually or in groups). The School has the discretion in deciding which office (e.g., financial aid, fiscal, loan collection, or dean's) will be responsible for the exit interview, and for determining the specific format of the exit interview as long it obtains the following documentation:

• Evidence that the borrower was reminded of his or her rights and responsibilities concerning the terms and conditions of the loan, and
• the borrower's current address, telephone number, and other information needed for loan collection. (See EXHIBIT K in the Word NFLP Guidance and PDF NFLP Guidance)

If a borrower fails to appear for an exit interview, the School must attempt to conduct the exit interview by mailing the exit interview information to the borrower and requesting that a copy of the repayment terms and the rights and responsibilities form or statement be signed and dated, the personal information form be completed and dated, and these items be returned to the School. If the borrower returns the information as requested, this will document that the exit interview was conducted. See Collections under the Fiscal Management web site for more information on exit interviews.

XXII. INSTRUCTIONS FOR COMPLETING APPLICATION FACE PAGE

Below is an explanation of the items found in the NFLP Application Face Page. If any item is not applicable, please insert "NA" in that space.

1. Entity Identification Number (EIN) and DUNS Number -- Enter the School's IRS employer
identification number and the DUNS number. See Page 3 of this Guidance for additional
information about the DUNS number.
2a. Institution From Which the Application is Made ' Enter the name of the institution, the street address, city, state and zip code.
3a. School of Nursing Coordinator ' Enter the full name, credentials, position title and full address of the Coordinator in the School/College of Nursing.
3b. Telephone and Fax Number of School of Nursing Coordinator ' Self Explanatory.
3c. Email of School of Nursing Coordinator ' Self Explanatory.
4a. Financial Aid Office Coordinator ' Enter the full name, position title and full address of the Coordinator in the Financial Aid.
4b. Telephone and Fax Number of Financial Aid Office Coordinator ' Self Explanatory.
4c. Email of Financial Aid Office Coordinator ' Self Explanatory.
5a. Authorized Official ' Enter the full name and position title of the official legally and financially responsible and accountable for the use and disposition of any HHS funds awarded on the basis of this NFLP application.
5b. Telephone and Fax Number of Authorized Official ' Self Explanatory.
5c. Email of Authorized Official ' Self Explanatory.
6. Congressional District of Applicant and Other Districts that Benefit Financially & Type of Institution ' Self Explanatory.
7. School of Nursing Coordinator and Financial Aid Office Coordinator Assurance
8. Signature of Person Named in 3a ' Self Explanatory.
9. Signature of Person Named in 4a. ' Self Explanatory.
10. Certification and Acceptance -The signature of an Authorized Official of the applicant school of nursing certifies that: the information in the application is correct and the institution agrees to comply with the applicable statutes and conditions placed on the award. If the official named in Item 5a is not available to sign for the applicant organization, an official authorized may sign as "acting" for this official.
11. Signature of Person Named in 5a ' Self Explanatory.

XXIII. RELEASE OF INFORMATION

A. General Public Information: HHS makes available routinely to interested persons a report listing programs awarded. Information made available includes the title of the project, school of nursing, project director, and the amount of the award.

The Freedom of Information Act (5 USC 552) and the associated Freedom of Information Regulations of HHS (45 CFR Part 5) require the release of certain information about programs upon request. Release does not depend upon the intended use of the information.

Generally available for release upon request are all funded applications; annual operating report of program; and final reports of any review or evaluation of program performance conducted or caused to be conducted by the Department. Release is subject to deletion of material that would affect patent or other valuable rights.

B. The Privacy Act: The Privacy Act of 1974 (5 USC 552a) and the associated Privacy Act Regulations (45 CFR part 5b) give individuals the right of access, upon request, to information in the records concerning themselves. The Act provides a mechanism for correction or amendment of such information. It also provides for the protection of information pertaining to an individual, but it does not prevent disclosure if release of such information is required under the Freedom of Information Act. If a Privacy Act system of records applies, the name and number of the system will be identified.

If applicable, the Privacy Act requires that a Federal agency requesting information from an individual advise the individual of the agency's authority to make the request; whether compliance with the request is voluntary or mandatory; how and why the information will be used both inside and outside the agency; and what the consequences are for the individual of failing to provide all or any part of the requested information.

HHS requests the information described in these instructions under authority of the PHS Act as amended (42 USC 289a-1). Although provision of the information requested is entirely voluntary, it is necessary for making award decisions. A lack of sufficient information may hinder HHS's ability to review applications. HHS will use this information and may disclose it outside the Department, as permitted by the Privacy Act under the applicable system of records.

C. Government Use of Information: In addition to being used in evaluating applications, other routine uses of information include disclosure to: the public as required by the Freedom of Information Act; the Congress; the National Archives and Records Service; the Bureau of the Census; law enforcement agencies upon their request; the General Accounting Office; and courts by order. It may also be disclosed outside of the Department if necessary to:

(1) a cognizant audit agency for auditing;
(2) the Department of Justice as required for litigation;
(3) respond to an inquiry from a Congressional office about the record of an individual made at the request of that individual;
(4) qualified experts not within the definition of Department employees as prescribed in Department regulations (45 CFR Part 5b.2, Purpose and Scope) for opinion as a part of the application review process;
(5) a Federal agency, in response to its request, in connection with the letting of a contract, or the issuance of a license, award or other benefit by the requesting agency, to the extent that the record is relevant and necessary to the requesting agency's decision on the matter;
(6) individuals and organizations deemed qualified by the HHS to carry out specific research related to the review and award process of the HHS;
(7) organizations in the private sector with whom HHS has contracted for the purpose of collating, analyzing, aggregating, or otherwise refining records in a system. Relevant records will be disclosed to such a contractor. The contractor shall be required to maintain Privacy Act safeguards with respect to such records; and
(8) the applicant organization in connection with performance or administration under the terms and conditions of the award.

XXIV. DEFINITIONS

Accreditation is a nongovernmental process conducted by representatives of postsecondary institutions and professional groups. As conducted in the United States, accreditation focuses on the quality of institutions of higher and professional education and on the quality of educational programs within institutions. Two forms of accreditation are recognized: one is institutional accreditation and the other is professional or specialized accreditation. A collegiate school of nursing must be accredited by a recognized body or bodies (i.e. Commission on Collegiate Nursing Education and/or National League of Nursing) or State agency, approved by the Secretary of Education for the purpose of conducting nursing education. The Secretary of Education publishes a list of recognized accrediting bodies, and of State agencies, which the Secretary of Education determines to be a reliable authority as to the quality of education offered at http://www.ed.gov/offices/OPE/accreditation/natlagencies.html.

Advanced Education Nursing Program means a program of study in a collegiate school of nursing or other eligible entity which leads to a master's and/or doctoral degree and which prepares nurses to serve as nurse practitioners, clinical nurse specialists, nurse-midwives, nurse anesthetists, nurse educators, nurse administrators, or public health nurses, or in other nurse specialties determined by the Secretary to require advanced education.

Continuing Students are NFLP loan recipients enrolled the previous academic year and are continuing enrollment in the education program offered by the institution.

Education Component consists of education courses, preceptor and/or supervised teaching practica identified within the curriculum to prepare students to become nurse faculty.

Full-Time Student means a student who is enrolled on a full-time basis as defined by the institution.

Graduate means an individual who has successfully completed all institutional requirements necessary to be granted a degree.

Minority means an individual whose race/ethnicity is classified as American Indian or Alaska Native, Asian, Black or African American, Hispanic or Latino, Native Hawaiian or Pacific Islander.

American Indian or Alaska Native means a person having origins in any of the original peoples of North and South America (including Central America), and who maintains tribal affiliation or community attachment.

Asian means a person having origins in any of the original peoples of the Far East, Southeast Asia, or the Indian subcontinent including, for example, Cambodia, China, India, Japan, Korea, Malaysia, Pakistan, the Philippine Islands, Thailand, and Vietnam.

Black or African American means a person having origins in any of the black racial groups of Africa.

Hispanic or Latino means a person of Cuban, Mexican, Puerto Rican, South or Central American or other Spanish culture or origin, regardless of race. The term Spanish origin, can be used in addition to Hispanic or Latino.

Native Hawaiian or Other Pacific Islander means a person having origins in any of the original peoples of Hawaii, Guam, Samoa, or other Pacific Islands.

White means a person having origins in any of the original peoples of Europe, the Middle East, or North Africa.
New Students are students who have never received NFLP support.

Part-time Student means an individual enrolled in an advanced education nursing program, carrying less than the full-time course load, as defined by the institution.

Post-Nursing Master's Certificate Program means a formal, post-graduate program that admits RNs with Master's degrees in nursing and, at completion, awards a certificate and academic credit.

Program means a combination of identified courses and other educational or training experiences at a specified academic level, the sum of which provides the required competence(s) to practice.