The following was submitted as a formal comment to the United States Department of Education on May 23, 2011.  The links were added after for CLHE members.

Since the comment is a bit technical in nature, CLHE will provide a series of issues briefs for members to explain the issues.

Docket ID ED-2011-OM-0002

May 23, 2011

Regina Miles
U.S. Department of Education
400 Maryland Avenue, S.W.
Washington, DC 20202
Sent Via: Federal eRulemaking Portal at http://www.regulations.gov

RE: Family Educational Rights and Privacy Act Notice of Proposed Rulemaking

Ms. Miles:

On behalf of the Council on Law in Higher Education (CLHE), I want to thank the Department of Education for this opportunity to provide comments on the April 8, 2011 FERPA proposed regulations.

CLHE is an independent nonprofit organization that conducts analysis on policy and legal issues affecting the higher education system.  Colleges and universities from across the country, along with law firms and other organizations, receive our information and analysis.

Since the organization was founded in 1998, CLHE has focused extensively on FERPA, along with privacy and information security issues in general.  The organization strongly supports student rights, including meaningful privacy protections.

This comment will first provide a brief overview of our views.  Secondly, as requested in the notice, the comment will address issues in the same order as the proposed regulations.

I. Brief Overview

Many of the proposed changes lack statutory authority under FERPA.  There also is nothing in the American Recovery and Reinvestment Act of 2009 (ARRA) or the American Creating Opportunities to Meaningfully Promote Excellence in Technology, Education, and Science Act (COMPETES Act) that conflict with FERPA thereby rendering any FERPA statutory requirement moot.

While Congress has shown support for statewide longitudinal data systems (SLDS), it has not amended FERPA.  The Department itself has not attempted to argue in the proposed regulations that ARRA or the COMPETES Act has preempted FERPA in any manner based on a statutory conflict.

Instead, the Department appears simply to be supporting SLDS.  This support is demonstrated by the following passage that discusses the authority to audit or evaluate educational programs:

The Department intends these clarifications to promote Federal initiatives to support the robust use of data by State and local educational authorities to evaluate the effectiveness of Federal or State supported education programs.

It may be sound policy to push SLDS, however, this does not give the Department the authority to ignore the plain language and intent of FERPA to achieve that policy objective.  Congress is the lawmaking body and must choose to make any statutory changes, including changes to FERPA.

The Department spends a significant amount of time in the proposed regulations discussing the policy objectives of ARRA and the COMPETES Act.  Yet, in these FERPA proposed regulations, the Department does not discuss in any significant manner how it is ensuring that FERPA is implemented and enforced consistent with the critical goals and intent of the FERPA statute.

In fact, the proposed regulations focus on how FERPA is an obstacle to achieve the policy objective of SLDS.  The goals of FERPA, and as a result, student privacy, play a secondary role to data sharing programs.

II. Specifics

Authorized Representative (99.3, 99.35)

There may not be a definition of “authorized representative” in the statutes, but the statutory language does provide some clear guidance on its face.  The statute specifically allows disclosure of PII, in limited situations, to the Comptroller General, the Attorney General, the Secretary of Education, and state and local educational authorities.

The proposed regulations would allow the above-mentioned agencies to designate any entity or individual, be it public or private, to serve as the authorized representative of the agency.

For example, as stated in the proposed regulations, “there is no reason why a State health and human services or labor department, for example, should be precluded from serving as the authority’s authorized representative and receiving non-consensual disclosures of PII…”

The effect of such an interpretation is to read out the statutory language providing for only specific agencies to receive PII.  If Congress intended for a state labor agency or other third party to receive such data, it would have said this directly in the statute.

It appears that such an interpretation would allow agencies to designate almost anyone it wants so long as some type of argument can be made that the entity or individual is conducting, “with respect to Federal or State supported education programs—any audit, evaluation, or compliance or enforcement activity in connection with Federal legal requirements that relate to those programs.”

It begs questions, such as:*

•    Would this allow one state to designate an agency in another state as an authorized representative?
•    Could individual state politicians be considered authorized representatives?
•    Could private companies that have very strong interests in the data independent of the reason for the disclosure, be authorized representatives?

As stated in the proposed regulations, it has been longstanding Department policy to consider an authorized representative as someone who is under the direct control of the specifically listed agencies.  Such a policy was specifically explained in the “Hansen memorandum.”

This policy reflects a proper interpretation of the statute (limits authorized representatives to those agencies specifically listed in the statute) and addresses the practical problems of agencies trying to control the disclosure of information.

By limiting it to individuals under the direct control of the agencies, there is some assurance that the specific agency will be accountable and take appropriate measures.  Under the proposed language, the agencies would be able, and may be required to if a state legislature so desires, to disclose information to third parties that are unlikely to take measures to prevent the improper disclosure of PII.

The proposed regulations characterize the current interpretation as being “restrictive.”  The opposite is true.  The interpretation allows the agencies to go beyond just allowing employees to have access to data by allowing third parties to have access to data as well.

Recommendation: Codify the “Direct Control” standard into the FERPA regulations.

Education Program (99.3, 99.35)

By changing the requirement that “education programs” be administered by educational agencies or institutions, the Department is creating both legal and practical problems.

Looking at the legal perspective, the Department is taking an unreasonable interpretation of the term “educational program” in order for outside entities to evaluate educational programs that are completely unrelated to educational agencies and institutions, as well as completely unrelated to students.

This interpretation would, for the first time, allow institutions to disclose information on students even if the disclosure of PII is for a purpose not directly related to a student or does not serve some specific function for the institution. While all other permissible disclosures are related to students and institutions, for the audit and evaluation disclosure, there would be a special exception.  Such an inconsistency in relation to all the other disclosures is further evidence that “education program” is being interpreted improperly.

The practical problems of this extreme interpretation also are significant.  An “educational program” can mean almost anything as proposed in the regulations.  Anyone can be an education provider—the definition of “education program” does not limit who can be a provider.  The definition of “education program” also does not require anything more than the program is “principally engaged in the provision of education.”

While such a broad interpretation may help a state health agency review the records of college students so it can look back and see the success of a Head Start program, as discussed in the proposed regulations, it also may lead to the following sample situations, assuming the program is federal or state-supported:

•    A public education television station receives PII to evaluate demographics of contributors.
•    Planned Parenthood, as part of its health education programs, receives PII to evaluate their programs.
•    The National Rifle Association, as part of its educational programs about gun safety, receives PII.
•    Voter education/get-out-to-vote groups receive PII to evaluate their programs.

The term “education” does not just mean classroom education and when not limited to what educational agencies or institutions do, the term can be extremely broad (as demonstrated in the above examples).

Combined with the definition of “authorized representative,” almost any entity, be it public or private (or even an individual) could have access to PII so long as one program that it runs is “principally engaged in the provision of education.”

Recommendation: Do not change the existing FERPA regulations that require educational programs to be those administered by educational institutions and agencies.

Authority to Audit or Evaluate (99.35)

As the proposed regulations explain, FERPA does not create authority for authorized representatives to audit or evaluate programs.  Therefore, the FERPA regulations require that some type of legal authority be established.

This requirement is necessary to ensure that institutions and agencies are properly disclosing PII to “auditors and evaluators” as allowed under the FERPA statute.

Allowing authority to be established if it is “express or implied” would permit institutions and agencies to disclose PII to entities even if that agency has no right, outside FERPA, to access the information.

This interpretation makes little sense given that the audit/evaluation exception involves compliance and enforcement-related activities—these are activities where legal authority must be established (i.e. a government agency has no ability to enforce a law if it does not have clear legal authority to enforce a law—it can’t just argue that the authority is implied).

It is unclear what “express or implied” means.  Since legal authority is not required, this would suggest that “express” or “implied” does not mean that the authority must be expressed or implied in law.  It is difficult to determine what would be express if it were not expressly authorized in law.

As for implied, the Department appears to intend that “implied” can be ascertained by the situation and not what a law would imply.  This would allow agencies to have an almost unlimited ability to claim it has a right to PII.

From a practical perspective, institutions and agencies would have no objective way to figure out whether they can or should disclose PII under the audit or evaluation exception.  If a state agency claims authority exists because it is implied, regardless of what the law states, an institution or agency would have to struggle to figure out whether disclosing the information violates FERPA.

By requiring legal authority, there is a practical objective way for institutions to properly comply with FERPA—they would just need to review the legal authority that is used as justification for the disclosure.

Recommendation: Maintain the existing FERPA requirement that there must be legal authority for a third party to receive PII to conduct audits and evaluations.

Directory Information (99.37)

Prohibiting the directory information opt-out provision to cover students wearing ID cards and ID badges for safety reasons is consistent with the notion that FERPA was not designed to prohibit institutions from properly functioning—it also is comparable to the existing exception under 99.37 prohibiting the directory information opt-out from being used in a class (name, identifier, or email address may be disclosed).

In the proposed regulations, there is no limit on what directory information may be included on the ID card.  This could be problematic, if for example, institutions required unnecessary information such as address or phone number (such information could even pose safety risks to the student wearing the ID).

Recommendation: Make the proposed change but specify the directory information that can be displayed bearing in mind that some information would be unnecessary.

Section 99.37(d) (Limited Directory Information Policy)

Under existing law, institutions already can decide who will or will not receive directory information.  Even so, there has been confusion as to whether FERPA allows institutions to formally disclose directory information for specific parties and/or specific purposes only.

This proposal does give institutions more clarity regarding directory information and allows them to feel more confident in having a directory information policy without fear of the information bring misused.

It also would be helpful if this proposed change clarified that institutions can have different policies based on each specific type of directory information.  For example, it would be very useful for institutions to be able to communicate that certain directory information may be disclosed to specific parties but not other types of directory information.

Recommendation: Make the proposed change but also clarify the change may apply to each type or subset of directory information.

Enforcement Procedures With Respect to Any Recipient of Department Funds That Students Do Not Attend (99.60)

The FERPA statute does not authorize the Department to expand who must comply with FERPA.  The entire statute is drafted in a manner that makes it very clear that “educational agencies or institutions” do not cover student loan lenders, nonprofits, etc.

The FERPA statute states, “No funds shall be made available under any applicable program to any educational agency or institution unless the parents of students who are or have been in attendance at a school of such agency or at such institution…”

The third party entities discussed in the proposed regulations would not be covered—for example, a student does not attend a student loan lender.  The entire statute covers requirements that would not apply to these third parties.

Recommendation: Do not expand the FERPA enforcement coverage.

_______

I again appreciate this opportunity to provide comments on the proposed regulations.  As the Department finalizes the regulations, I hope that it will respect and protect the very important privacy objectives of FERPA.

Sincerely,

Daren Bakst, J.D., LL.M.
President
Council on Law in Higher Education

*These scenarios likely would be answered in the affirmative, especially when considering the other proposed changes in the regulations.

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The long running controversy as to whether medical residents are subject to FICA tax drew to a close earlier this month when the Supreme Court issued its opinion in Mayo Foundation for Medical Education and Research et al. v. U.S.  The Court ruled in favor of the government, holding that the patient care services that medical residents at the Mayo Foundation and the University of Minnesota perform as part of their respective medical residency programs do not qualify under the so-called “student FICA exemption” and that the wages paid to the medical residents for such services are therefore subject to FICA tax.

Medical Residents and the Student FICA Exemption

Thus, the student FICA exemption only applies to those individuals who are both students at and employees of the educational institution, and the IRS has long held that a student-employee qualifies for the exemption only if the facts demonstrate that the individual is primarily a student, and not primarily an employee.

The student FICA exemption statute — IRC § 3121(b)(10) — is fairly straightforward as tax statutes go.  It basically states that wages paid to a student in connection with employment services he/she performs for the school, college, university at which he/she is enrolled and regularly attends classes are exempt from FICA tax. Thus, the student FICA exemption only applies to those individuals who are both students at and employees of the educational institution, and the IRS has long held that a student-employee qualifies for the exemption only if the facts demonstrate that the individual is primarily a student, and not primarily an employee. For example, a full-time undergraduate student who works 20 hours a week in the university library is primarily a student and exempt from FICA tax on the wages he receives, while the university controller who enrolls in a 3-hour music appreciation class is primarily an employee and subject to FICA tax on her wages.

Prior to 2005, there were serious disagreements between the IRS and higher education about how this student v. employee balancing test should be administered, but these issues were largely resolved in 2005 when the IRS issued a new set of student FICA exemption regulations and a separate set of safe harbor guidelines, both of which were effective April 1, 2005.  These new IRS regulations and safe harbor guidelines, while pretty much resolving the student FICA exemption issue for most types of student-employees, contained a provision that kept the controversy alive with respect to a small but important category of student-employees — medical residents.

In the pre-2005 IRS regulations, medical residents were not specifically treated but fell under the general balancing test that looked at various facts and circumstances on a case-by-case basis to determine whether the individual’s relationship to the school was primarily as a student or primarily as an employee.  Medical schools and hospitals felt strongly that when this facts and circumstances test is applied to a medical resident the resident should be viewed as primarily a “student” in that the typical resident attends classes, submits papers, sits for exams, etc. and that the resident’s patient care work is simply a part of the overall educational experience, much like an apprentice learning a trade.  The IRS, on the other hand, felt equally as strongly that the medical resident performed valuable and significant services for the hospital, often working in excess of 60-80 hours a week and was therefore primarily an employee.

Litigation Under the Pre-April 1, 2005 Regulations

The University of Minnesota was the first to litigate this issue under the prior IRS regulations.  In 1998, the 8th Circuit, after reviewing the facts and circumstances of the University’s medical residency program, concluded that the residents were primarily students who qualified for the student FICA exemption.  This victory caused hundreds of other medical schools and hospitals to file FICA tax refund claims with the IRS, arguing that they had incorrectly withheld and paid FICA tax on medical resident wages and requesting a refund of those FICA taxes.

The IRS, however, strongly disagreed with the 8th Circuit’s University of Minnesota decision, refused to grant the FICA tax refund claims filed by the other medical schools and hospitals, and continued to litigate the medical resident FICA tax issue.  But instead of litigating the factual balancing test question of whether medical residents are primarily students or primarily employees — a question the government lost in the University of Minnesota case — the IRS pursued a summary judgment approach, arguing that the legislative history underlying IRC § 3121(b)(10) presumptively demonstrates that Congress did not intend medical residents to qualify for the student FICA exemption.  This legislative history-based argument was rejected by four different courts of appeal (the 2nd, 6th, 7th, and 11th Circuits), thus leaving the IRS in the position of having to litigate whether the medical resident is primarily a student or primarily an employee based on the facts of the particular medical residency program, an argument that the government lost in the 8th Circuit.

Litigation Under the April 1, 2005 Regulations

When the IRS published its new set of student FICA exemption regulations in 2005, it maintained the same fact-based student v. employee balancing test used in the prior regulations, but included a provision stating that those student-employees who are “full-time employees” (defined as employees whose normal work schedule is 40 hours or more a week) will be treated as primarily employees, not students, regardless of the particular facts and circumstances surrounding their student obligations or their employment duties. (Treas. Reg. § 31.3121(b)(10)-2(d)(3)(iii)).  To make sure that everyone understood that this “full-time employee” rule was intended to prevent medical residents from qualifying for the student FICA exemption, the IRS included a specific example in the regulations to this effect.  (Treas. Reg. § 31.3121(b)(10)-2(e)(Example (4))).

Faced with a new IRS regulation that threatened to reverse the medical resident FICA tax exemption granted by the 8th Circuit decision in its 1998 decision, the University of Minnesota brought a FICA tax refund suit for post-April 1, 2005, tax periods arguing that the new full-time employee rule was invalid.  The Minnesota district court agreed, saying that the full-time employee presumption is inconsistent with the unambiguous text of IRC § 3121(b)(10), which, the court said, allows a FICA tax exemption in every case where the educational aspect of the person’s activities predominates over the employment services aspect, regardless of the number of hours worked.  The government appealed this decision to the 8th Circuit, and the University’s case was consolidated with an identical case brought by the Mayo Foundation for Medical Education and Research, which also operated a residency program in Minnesota and had also received a favorable decision at the district court level.  On appeal, the 8th Circuit reversed the district court and upheld the validity of the full-time employee rule.  The University and the Mayo Foundation filed a joint petition for certiorari with the Supreme Court, and the Court decided to hear the case.

Supreme Court Decision

The Supreme Court, in upholding the 8th Circuit’s decision and the validity of the full-time employee presumption in the April 1, 2005 regulations, spent very little time discussing or analyzing the statutory student FICA exemption; rather, it focused primarily on the somewhat esoteric principles relating to the administrative rule-making powers vested in the IRS and other government agencies.

The Supreme Court, in upholding the 8th Circuit’s decision and the validity of the full-time employee presumption in the April 1, 2005 regulations, spent very little time discussing or analyzing the statutory student FICA exemption; rather, it focused primarily on the somewhat esoteric principles relating to the administrative rule-making powers vested in the IRS and other government agencies.

The focus of the Court’s discussion centered on a two-part test that the Court had formulated in 1984 to determine the validity of an administrative regulation.  This test – known as the Chevron test after the case in which the test was announced – said that a regulation’s validity is determined by looking, first, at whether Congress has directly addressed the precise question at issue.  If so, any regulation contrary to such Congressional statement is invalid.  But if Congress has not addressed the issue, the second part of the Chevron test says that the agency determination will not be disturbed unless it is arbitrary, capricious, or manifestly contrary to the statute.

In the University/Mayo case, the Court applied the two-part Chevron test to the full-time employee regulation and found that both tests are met and that the regulation is therefore valid.  It rejected the University/Mayo’s argument that, at least in tax cases involving IRS regulations, a less deferential, multi-factor test set forth in an earlier 1979 decision (the National Muffler case) should be used in place of the second part of the Chevron test, saying, “we are not inclined to carve out an approach to administrative review good for tax law only.”

What Does the Decision Mean?

The immediate impact of the decision is, of course, that effective April 1, 2005, wages paid to medical residents will be subject to the FICA tax.  (Interestingly, on March 2, 2010, the IRS announced that it would grant FICA tax refunds for all claims filed for tax periods before April 1, 2005, when the prior regulations were in place.

But the broader implication for colleges, universities, and all taxpayers is that the Supreme Court has confirmed that the IRS has broad and expansive right to promulgate regulations interpreting a tax statute as it sees fit, even where courts may have held to the contrary.

But the broader implication for colleges, universities, and all taxpayers is that the Supreme Court has confirmed that the IRS has broad and expansive right to promulgate regulations interpreting a tax statute as it sees fit, even where courts may have held to the contrary.  Whether this power will impel the IRS through administrative regulations to begin effectively reversing adverse judicial decisions, or motivate the agency to issue regulations in lieu of litigating an issue, remains to be seen.  But it seems clear that the Supreme Court’s decision in the University of Minnesota/Mayo Foundation case gives the IRS wide latitude in interpreting Internal Revenue Code provisions in a manner favorable to the government.˜

_________

Bertrand Harding is a tax attorney who operates his own law firm in Alexandria, Virginia, specializing in tax issues facing colleges and universities.  He is the author of The Tax Law of Colleges and Universities (3d ed), which is published by John Wiley & Sons.

Introduction

The numbers of U.S. students studying abroad has increased by over 150% in 10 years. This means that the likelihood of students needing medical care or experiencing a crisis while abroad has also increased. One key tool in managing these situations and increasing a positive outcome for our students is their travel medical insurance. Though most education aboard professionals will shudder at the thought of an in-depth consideration of insurance, a little pain now will certainly pay for both your students and your organization. Do you know how travel medical insurance is handled for your education abroad students? Do you know how your practice compares to your peer institutions?

According to Responsible Study Abroad: Good Practices for Health and Safety (2002), organizations are clearly told, “Require that participants be insured. Either provide health and travel accident (emergency evacuation, repatriation) insurance to participants or provide information about how to obtain such coverage.”

Published more recently, The Standards of Good Practice for Education Abroad (2008), includes no statement of insurance practices but does ask the following question for programs that wish to test themselves against the Standards of Good Practice: “Does the organization require or inform students about the need for health and repatriation insurance?”

Beyond knowing we should provide or tell students to get travel health, evacuation, and repatriation insurance, organizations and professionals are left to determine the rest on their own. Is it better to provide insurance or advise students to obtain their own coverage? Should organizations require (or offer) certain levels of coverage? Is it enough to simply inform students that they need some level of coverage and leave the decision on how much to the students and their families? There is not one gold standard for education abroad insurance and thus, not one goal for organizations to work toward. That being said, most organizations have insurance practices that fall into two general categories.

Category One:  “Leave it to the Student”

This model allows organizations to provide information to students and their families who are then responsible for making individual choices on what insurance is a good fit for the traveler. A policy statement for an organization following this model would look similar to: “Students must have adequate insurance to cover them while abroad.”

Some organizations will take it one step further and require both health and evacuation/repatriation coverage or may provide a handout with guiding questions to consider things such as pre-existing health concerns, the need for mental as well as physical health coverage and common policy exclusions. Yet others will recommend a certain level of coverage in key areas such as recommending major medical limits of at least $250,000 or pre-existing condition coverage of at least $50,000.

The advantage of this model is that it allows the family and traveler to make choices based on the specific needs of the traveler. If, for example, a student has a known pre-existing condition they can choose a policy with no pre-existing condition exclusion even if the policy is slightly more expensive where another student might be well served by choosing a policy with very little coverage for pre-existing conditions. Additionally, as many universities require health insurance coverage for all students on their home campuses, this model could save students money for those students who have international coverage as part of their U.S. insurance. Also, from an administrative standpoint, this model saves the organization the time and resources that would be required to maintain an organizational education abroad insurance policy. Finally, as the onus is on the student to make the choices, theoretically the organization’s responsibilities and risks related to insurance are reduced.

The disadvantage of this model is that the education abroad organization won’t truly know if the students have “adequate” coverage. There will be some students and families who will take this task very seriously and may even consult with an insurance professional, but there will be others who will simply check the insurance box (“I’ve got insurance”) and move on to more exciting parts of their planning (reviewing guidebooks and planning their weekend trips).

The disadvantage of this model is that the education abroad organization won’t truly know if the students have “adequate” coverage. There will be some students and families who will take this task very seriously and may even consult with an insurance professional, but there will be others who will simply check the insurance box (“I’ve got insurance”) and move on to more exciting parts of their planning (reviewing guidebooks and planning their weekend trips). The organization also won’t know which of literally hundreds of policies cover the students or the specifics of how to access the coverage for each individual student. For students that need to purchase coverage outside of their U.S. coverage (which will likely be a large percentage of the population), they will not benefit from premium discounts available to groups plans and thus will need to pay $50 or more dollars a month for a comprehensive plan.

Leave it to the Student, But Require They Meet Minimums

One way that some organizations have mitigated some of the disadvantages of this model is to require that students certify a certain level of personal coverage. One way to do this is to provide detailed guidance on obtaining coverage and collect a signed form indicating that students have met organizational required minimums. Of course, this has its own disadvantages as it arguably brings a higher level of responsibility back to the education abroad organization. Thus, it is important that staff make the decisions for coverage minimums with the support of the experts within their organization including legal counsel. This, along with developing documents and tracking completion for each student will add to staff workloads.

A second option would be to require that students prove certain coverage minimums by requiring a copy of each student’s policy. But this assumes that someone at your organization has the training and the time to review insurance policies.

A second option would be to require that students prove certain coverage minimums by requiring a copy of each student’s policy. But this assumes that someone at your organization has the training and the time to review insurance policies. While some organizations rely on education abroad professionals to review insurance policies, this is a risky venture that would make most legal and insurance professionals cringe. A better process would require internal risk management or external insurance professionals to take on this role.

Category Two: Organization Mandated Coverage

This model is one where the organization makes the choice to require all participants to have a specific education abroad insurance coverage. Most commonly this is a travel medical insurance policy with medical evacuation and, in some cases, also includes security evacuation coverage. Sometimes it is an “off-the-shelf” policy that the organization reviews and decides meets their needs. Most often however, the organization negotiates a group policy to address the needs of their specific population while taking advantage of the opportunity to negotiate to receive better coverage at a lower cost than what is available to individual travelers.

Having one required policy allows the organization to assure a certain “adequate” level of insurance for all participants.

Having one required policy allows the organization to assure a certain “adequate” level of insurance for all participants. Also, the organization can be sure that they know the single insurance policy and provider, thus making it easy to revoke the coverage when needed. This model usually requires some type of enrollment of travelers for specific dates and locations. An interesting added benefit, especially for decentralized universities, is that a mandated insurance policy can help identify travelers who otherwise might not report their travel in an official way.

One disadvantage of this model is that it puts a great deal of responsibility on the organization to meet the needs of their students and arguably opens the organization to risks. Thus, the organization must take this responsibility seriously and take steps to make good decisions up front. As Friend (2009) points out in What’s in YOUR policy?, there are many details to consider. For example:

• What are reasonable limits for major medical?
• What exclusions can the organization and its travelers tolerate?
• What is a reasonable co-pay or deductible?
• What will it cost to evacuate a student or return their mortal remains to their family?

Organizations who use this model should rely on insurance and legal experts to assist in making decisions. Therefore, a second considerable disadvantage of this model is that it is time and resource intensive. Not only does it take time to decide on what policy and with what limits to use, this model will require staff time to enroll participants and likely answer more questions than when students are on their own to obtain coverage.

Requiring a specific policy could result in duplicate coverage for some students who already have international coverage as part of their U.S. health insurance, which can also be a disadvantage. In some cases, both the student’s home university and the organization directly responsible for the student’s program will require coverage, resulting in further duplication.

Will your organization consider waiving your mandated coverage for another policy? If yes, what are the processes and coverage requirements that will result in a waiver? Will you waive for a student’s U.S policy or only for a partner policy? There are important implications for staff time, student budgets, and organizational responsibility to be considered.

The Blanket Coverage Option

An interesting option within the organization mandated model is to remove the enrollment requirement, thus making the insurance coverage automatic for all travelers for the organization. An advantage of this automatic “blanket coverage” is that it removes the staffing requirement of enrolling travelers but conversely limits the tracking opportunities that come along with traveler enrollment. The implication on premiums is also a consideration in this model, which would require a blanket premium to cover all travelers rather than individual premiums that are based on specific travel dates.

Commonly, student premiums for organization mandated coverage are passed onto students directly or indirectly as part of a comprehensive education abroad fee. With no enrollment, the organization would need to cover the annual premium, consequently taking on some level of financial risk even if some of the costs could be recouped from education abroad fees.

Blanket coverage could include the comprehensive medical coverage and medical/security evacuation or could be for only one part of the coverage package. For example, an organization could have only blanket coverage for the medical evacuation, return of mortal remains and security evacuation portions of the insurance package and leave medical insurance choice to individual students.

What is the Best Practice?

As the vast options presented here are overwhelming, they are not inclusive of all the ways that medical insurance is handled for education abroad students. With industry standards that allow such a range of model and practices, it makes it difficult for decision makers at universities and education abroad programs to know what the best practices are. Thus, it is important that education abroad professionals continue to have these discussions in consultation with their legal and insurance counterparts.

Questions to consider include:

• What are the legal risks and considerations of your organization’s current practices?
• How do your current practices compare to your peer organizations both in the traditional sense and among peers with similar insurance models?
• What are the state and federal insurance regulations that impact your organization?
• What practice/policy does the best job of protecting your students?

___________________

Stacey Tsantir is the International Health, Safety, and Compliance Coordinator, Office of International Programs, University of Minnesota

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Q: What are the most important changes to student aid programs enacted by HCERA?

A: Starting July 1, 2010, all new federal education loans, including Stafford, PLUS and Consolidation loans, will be made through the Direct Loan program. The Congressional Budget Office (CBO) scored the legislation in March 2010 as saving $68 billion over 10 academic years (11 fiscal years). This savings was used to justify a $40 billion increase in funding for the Pell Grant program, $21 billion in deficit reduction, and spending on several smaller programs.

Q: Is this legislation the same as the Student Aid and Fiscal Responsibility Act (SAFRA)?

A: The original version of SAFRA (HR 3221) passed the US House of Representatives on September 17, 2009 by a vote of 253 to 171. Passage in the Senate would normally require a 60 vote majority. However, a parliamentary option called “budget reconciliation” permits passage with only a simple majority of 51 votes. Action in the Senate was delayed in order to preserve the use of budget reconciliation as an option for passage of health care reform. The delays lead to a re-scoring of the legislation, leading to $20 billion cut in the savings attributable to the mandatory switch to direct lending. That, in turn, forced Congress to drop several provisions from the SAFRA legislation to save money.

Q: Why was budget reconciliation necessary?

A: The U.S. Senate did not have the 60 votes necessary to pass the legislation without budget reconciliation. Senators with lender facilities in their states were concerned about the potential job loss. The legislation ultimately passed the U.S. Senate 56 to 43 and the U.S. House of Representatives 220 to 207 on March 25, 2010.

Q: Why was the student loan bill paired with the health care reform legislation?

A: There can be only one reconciliation bill per budget cycle. The Senate leadership knew that they would probably need budget reconciliation to pass both bills. In addition, the savings from the student loan bill would help ensure that the combined bill reduced the deficit, a prerequisite for any budget reconciliation legislation. Finally, the student loan bill was very popular in the U.S. House of Representatives, bring several votes to the combined measure.

Starting July 1, 2010, all new federal education loans, including Stafford, PLUS and Consolidation loans, will be made through the Direct Loan program.

Q: What provisions were dropped from the final version of SAFRA?

A: The major provisions that were dropped included the Perkins loan expansion and reengineering and the indexing of the maximum Pell Grant to 1% over the inflation rate. Funding for the College Access Challenge Grant program was cut from $3 billion to $750 million and the Community College funding was cut from $10 billion to $2 billion. Funding for elementary and secondary education was eliminated. Finally, the additional FAFSA simplification changes were dropped. These included replacement of the 6 asset questions with a net asset cap on eligibility for need-based federal student aid and the elimination of 12 of the untaxed income and benefits questions.

Q: Does passage of this legislation mean all colleges need to switch to Direct Lending now?

A: Yes. The legislation is final. If a college wants its students to have access to federal education loans starting July 1, 2010, the college needs to switch to the Direct Loan program now without delay. Switching to the Direct Loan program may involve changes to administrative software systems, staff training and student publications.

Q: Is technical assistance available to help a college switch to the Direct Loan program?

A: The HCERA legislation included funding for the US Department of Education to provide technical assistance to colleges who are switching to the Direct Loan program. U.S. institutions who need help should call 1-800-848-0978 or email DLEnrollment_FSA@ed.gov.

Foreign institutions should call 1-202-377-3168 or email FSA.Foreign.Schools.Team@ed.gov.

The National Direct Student Loan Coalition, a group of colleges already in the Direct Loan program, is also providing assistance. Visit www.directstudentloancoalition.org for more information.

Q: Does the switch to Direct Lending affect existing loans?

A: No. Existing FFELP loans will remain with the lenders unless the borrowers consolidate their loans into the Direct Loan program. All borrowers may consolidate into the Direct Loan program even if they have previously consolidated in the FFEL program.

Q: What are some of the key practical differences in the Direct Loan program from a borrower perspective?

A: The interest rate on the Direct Loan version of the PLUS loan (both Parent PLUS and Grad PLUS) is lower and the approval rate is higher. The PLUS loan has a 7.9% interest rate in the Direct Loan program, compared with the 8.5% interest rate in the FFEL program. The Stafford loan is essentially identical in both programs.

Student and parent borrowers in the Direct Loan program obtain their federal education loans from the college’s financial aid office instead of having to find a lender. After the borrower signs the Master Promissory Note (MPN), the college will be able to pull down the loan funds directly from the U.S. Department of Education. The Direct Loan program gives colleges more administrative responsibilities, but also gives them more control over disbursements.

Q: Why is the interest rate on the PLUS loan lower in the Direct Loan program?

A: The Higher Education Reconciliation Act of 2005 (HERA), enacted as part of the Deficit Reduction Act of 2005 (PL 109-171, 2/8/2006), increased the interest rate on the PLUS loan from 7.9% to 8.5% effective July 1, 2006. (The Stafford loan interest rate was scheduled to switch to a fixed rate of 6.8% and the PLUS loan interest rate to a fixed rate of 7.9% on July 1, 2006 by legislation enacted in 2002 (PL 107-139, 2/8/2002).) Due to a legislative drafting error, the increase were applied only to the FFEL version of the PLUS loan. The Direct Loan version of the PLUS loan remained at 7.9%.

Q: Why is the PLUS loan approval rate higher in the Direct Loan program? Don’t both programs use the same adverse credit history criteria?

A: The eligibility requirements for the PLUS loan require borrowers to not have an adverse credit history. An adverse credit history is defined as having a current delinquency of 90 or more days on any debt or a five-year lookback for certain derogatory elements of the credit history, such as bankruptcy discharge, foreclosure, repossession, tax lien, wage garnishment or default determination.  Some FFELP lenders have incorrectly used a five-year lookback for 90-day delinquencies, instead of just a current 90-day delinquency. This is not a violation of the regulations, as the regulations at 34 CFR 682.201(c)(2)(iii) permit lenders to adopt more stringent credit underwriting criteria. But it is an error that increases the denial rate significantly. Analysis of 2007-08 data from the National Postsecondary Student Aid Study shows a Parent PLUS loan denial rate of 42% in the FFEL program and 21% in the Direct Loan program.

Q: Will current borrowers benefit from the lower interest rate on the PLUS loan in the Direct Loan program?

A: The switch to the Direct Loan program affects only new loans. Existing PLUS loans in the FFEL program will be unchanged. Consolidating a FFELP PLUS loan into the Direct Loan program does not change the underlying interest rate on the loan.

Q: Who will be servicing the loans in the Direct Loan program?

A: The U.S. Department of Education awarded servicing contracts to four FFELP lenders, who began servicing new Direct Loans in August 2009. These contractors are Sallie Mae, Nelnet, PHEAA and Great Lakes. Borrowers are assigned randomly to the servicers to permit an apples-to-apples comparison of servicing performance without regard to demographic differences among the borrowers. Servicing performance includes default aversion, and customer service surveys completed by borrowers and colleges. Servicing volume will be adjusted according to servicing performance. In addition, HCERA earmarked servicing contracts for up to 100,000 borrowers total in each state to certain non-profit state servicers.

The maximum Pell Grant will remain flat at $5,550 from 2010-2011 through 2012-2013, then it will be indexed to the Consumer Price Index (CPI-U) inflation rate from 2013-2014 through 2017-2018, and then it will remain flat from 2018-2019 through 2019-2020.

Q: Borrowers could end up with three different types of loans each of which must be serviced separately: FFELP loans, FFELP loans sold to the US Department of Education through the ECASLA legislation, and Direct Loans. Does HCERA include any options to help borrowers simplify the repayment process?

A: Borrowers with loans in at least two of these programs may consolidate their loans while they are still in school from 7/1/2010 to 6/30/2011. The interest rate will be the weighted average of the interest rates on the loans being consolidated, without the usual rounding of the interest rate to the nearest 1/8th of a point.

Most borrowers should not use this provision as they will lose the remainder of the six month grace period on their loans. There is no real benefit to consolidating loans while they are in school, as the interest rates on federal education loans made since 7/1/2006 are already fixed. The financial benefit of avoiding the rounding up of the interest rates by 1/8th of a point is negligible. Many borrowers will need their six month grace period in the current difficult job market. Moreover, borrowers can simplify the repayment process by consolidating their loans after they enter repayment.

Q: How is the income-based repayment plan changing?

A: The HCERA legislation implements President Obama’s proposal to improve the income-based repayment plan. It cuts the monthly payment by one-third from 15% of discretionary income to 10% of discretionary income. It also accelerates the forgiveness of the remaining loan balance from 25 years to 20 years. These changes are effective for new borrowers of new loans made on or after July 1, 2014.

Q: Is public service loan forgiveness changing?

A: No. Public service loan forgiveness will still forgive the remaining loan balance after 10 years of full-time employment in a public service job when the federal student loans are repaid in the Direct Loan program.

Q: Will current borrowers benefit from these changes?

A: No. The changes are not retroactive. Current borrowers will continue to use the current income-based repayment program, however, which is still a pretty good safety net for borrowers who are experiencing financial difficulty.

Q: Some people have called the HCERA legislation the “single largest investment in college aid ever,” noting that it invests $36 billion over 10 years to increase the maximum Pell Grant. But you have called the increases in the maximum Pell Grant anemic. Who’s right?

A: The American Recovery and Reinvestment Act of 2009, the stimulus bill, increased the maximum Pell Grant to $5,350 for the 2009-10 academic year. This was a one-time increase, valid only for one academic year. In addition, Congress underestimated the number of applicants who would qualify for the Pell Grant, leading to a funding shortfall. Most of the increase in funding for the Pell Grant program will be used to backfill the funding shortfall and to maintain the stimulus bill’s increases in the Pell Grant more permanently.  Unfortunately, this leaves very little money for increases in the Pell Grant beyond the $5,550 maximum grant for the 2010-11 academic year.

The maximum Pell Grant will remain flat at $5,550 from 2010-2011 through 2012-2013, then it will be indexed to the Consumer Price Index (CPI-U) inflation rate from 2013-2014 through 2017-2018, and then it will remain flat from 2018-2019 through 2019-2020. The projected maximum Pell Grant will be $5,975 in 2019-2020, only $425 more than the maximum Pell Grant in 2010-2011. This yields an average annualized increase of CPI-U minus 0.75%. Thus the increases in the maximum Pell Grant are anemic and will not keep pace with inflation. This falls short of President Obama’s proposal for indexing the maximum Pell Grant to CPI-U plus 1%, as was passed by the U.S. House of Representatives in September 2009. It also does not eliminate the feast/famine cycles that have lead to an unchanged maximum Pell Grant for years at a time, as happened for four years during the Bush administration.

Q: If Congress hadn’t passed HCERA, would the maximum Pell Grant have been cut in half as some people have said?

A: If Congress hadn’t passed HCERA or otherwise backfilled the Pell Grant funding shortfall, the maximum Pell Grant would have been cut severely in 2010-2011. The Pell Grant program is an academic year program that runs from July 1 to June 30. This spans two federal fiscal years, which run from October 1 to September 30. When appropriations for the Pell Grant program fall short, the U.S. Department of Education can “borrow” from the second fiscal year’s appropriations to help fund the shortfall. When the shortfalls are relatively small, the U.S. Department of Education can continue in this manner for several years before Congress has to pass a supplemental appropriation to eliminate the shortfall. This time, however, the funding shortfall was large enough that it would have required cutting the next year’s maximum Pell Grant.

Q: How will the EFC cutoff for Pell Grant eligibility be affected?

A: The expected family contribution (EFC) eligibility cutoff will be based on 95% of the overall maximum Pell Grant, as opposed to just the discretionary maximum. The EFC eligibility cutoff for 2010-2011 will be $5,273, up from $4,617. Students with an EFC less than this threshold will qualify for a Pell Grant.  This should increase the number of Pell Grant recipients by about 240,000.

Q: Will the Pell Grant now be a true entitlement program?

A: Unfortunately, no. The Pell Grant is still funded through a combination of discretionary and mandatory funding, so it is still not a true entitlement program. Entitlement programs are funded with only mandatory funding.

Since the Pell Grant is not a true entitlement, it is possible that the maximum Pell Grant could be cut as it was in 2008, when the maximum Pell Grant was cut from $4,800 to $4,731 due to an across-the-board budget cut. Such a scenario is likely given the prospect of big budget deficits for the next several years.

Q: How does the Direct Loan program save money over the FFEL program?

A: The Direct Loan program saves money for three main reasons. First, the federal government has a lower cost of funds than FFELP lenders. The federal government can borrow at Treasury rates, which are currently very close to 0%. This yields a competitive advantage to the Direct Loan program. Second, by “eliminating the middleman” the federal government gets to keep more of the spread from the federal education loans for itself. These loans are profitable, despite being made to borrowers without any collateral and without regard to credit quality, in part because of the federal government’s strong powers to compel payment of defaulted loans. Proponents of the Direct Loan program also argue that the government bears the risk of default and so should derive all of the financial benefits. Third, economies of scale permit more cost-effective servicing of loans, since fewer lenders will be servicing loans. The U.S. Department of Education’s contracts with the four servicers pay the servicers about one third less on a unit basis than the lenders had previously charged for servicing in securitizations of their own FFELP loan portfolios. The servicing contracts pay even lower rates for borrowers who are in a deferment or forbearance, delinquent or in default.

Q: Why did the Congressional Budget Office (CBO) reduce the savings estimate?

A: When the CBO originally scored the legislation in February 2009, it estimated savings of $87 billion. This figure dropped to $68 billion when the legislation was rescored in March 2010, a $20 billion decrease. Most of the decrease, however, was due to colleges switching to the Direct Loan program on their own in anticipation of the expiration of the ECASLA liquidity provisions and uncertainty about the future of the FFEL program. The federal government is still realizing the savings from these colleges switching to the Direct Loan program, but the legislation cannot claim credit for the savings.

Q: How realistic are the savings estimates? Is the Direct Loan program really going to save money over the FFEL program?

A: It is easy to quibble over the savings estimates, in part because the estimates are extremely sensitive to economic assumptions. The CBO scoring also does not consider market risk and a variety of other factors, so it overstates the savings. The actual savings will probably be much closer to the estimates prepared by the Office of Management and Budget (OMB).

Regardless of which savings estimate one uses, the Direct Loan program will still save billions of dollars more than the alternatives. It is very difficult for Congress to ignore an opportunity to increase spending on student aid at no cost to the taxpayer. Congress decided that this was more important than saving several thousand FFELP jobs and avoiding the unknown potential for disruption during the transition to the Direct Loan program.

The accuracy of the CBO estimates does not matter in the strange calculus that operates on Capitol Hill. The CBO estimates may be flawed, but at least they are nonpartisan, and they provide the justification for increased spending on student aid. CBO estimates were used in the Higher Education Reconciliation Act of 2005, when Republicans dominated Congress, just as they are used in the Health Care and Education Reconciliation Act of 2009, when Democrats dominate Congress.

____

Mark Kantrowitz is the Publisher of FinAid.org and FastWeb.com

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When properly administered, university nondiscrimination policies provide important protections for students.   But when woodenly administered, such policies threaten vital constitutional protections of students’ speech and associational rights.   In CLS v. Martinez, Hastings College of the Law (“Hastings”) has applied a nondiscrimination policy–intended to protect students from being mistreated by the university because of their religious beliefs–in such a way that the university actually has denied a group of religious students fair treatment because of their religious beliefs.

Universities that have dealt with similar situations have typically arrived at a sensible reconciliation of their nondiscrimination policies and their duty to respect students’ diverse religious beliefs.  With modest flexibility and common sense in interpreting their nondiscrimination policies, other universities can avoid needless conflict between nondiscrimination values and First Amendment rights.

The Facts of Christian Legal Society v. Martinez

Like most institutions of higher education, Hastings encourages a broad array of student organizations to meet, express their views, and conduct activities on campus.  When this case arose in the fall of 2004, approximately 60 “registered student organizations” (“RSOs”) formed on the Hastings campus around diverse interests in politics, religion, culture, race, ethnicity, and human sexuality, including Democrats and Republicans, Muslims and Jews, pro-lifers and pro-choicers, numerous ethnic groups, and homosexual and feminist activist student groups.

RSOs are entitled to priority access to meeting space, to apply for a small share of the student activity fees collected from all students, and to communicate through multiple means with students and faculty.  For example, RSOs may post on designated bulletin boards, send mass emails to the student body, distribute material through the Student Information Center, appear on published lists of student organizations in the new student guidebook and on the university’s web listing of RSOs, and participate in the annual Student Organizations Fair.  In the student handbook and its own policies, Hastings quite correctly insists that it neither sponsors nor endorses the views of the RSOs.

Founded in 1961, Christian Legal Society is a national association of lawyers, law students, law professors, and judges who share a common faith and seek to honor Jesus Christ in the legal profession.  CLS provides members with fellowship and spiritual encouragement while promoting justice, religious liberty, and legal aid to the poor.

CLS student chapters exist on nearly 90 American law school campuses.  The signature activities of the chapters are Bible studies, as well as hosting outside speakers to discuss integrating faith with legal practice.  CLS welcomes all students to attend and participate in its meetings and other activities.  However, to be officers or voting members of CLS—and to lead its Bible studies—students must affirm their commitment to CLS’s core Christian beliefs by signing a Statement of Faith.  CLS views acts of sexual conduct outside of marriage between one man and one woman–whether heterosexual or homosexual conduct–to be inconsistent with affirmation of its Statement of Faith.  CLS does not view homosexual orientation, as opposed to conduct, as disqualifying a person from membership or leadership.  Nor does CLS care about a person’s religious heritage, so long as the person holds the basic Christian beliefs articulated in the Statement of Faith.

When a group of students sought to register as a CLS student chapter, they became the only group ever denied RSO status.  Hastings refused recognition based on its nondiscrimination policy, deeming CLS’s requirement that its leaders and voting members agree with its religious viewpoints to be religious discrimination, and CLS’s moral conduct standards for its leaders and members to be sexual orientation discrimination.

Hastings’ Nondiscrimination Policy comprises two paragraphs.  The first forbids only “legally impermissible, arbitrary or unreasonable discriminatory practices,” in accordance with the College’s commitment to “comply fully with applicable law.”  But no law prohibits a student group such as CLS from confining its voting membership or leadership to those who profess and follow its religious creed.  The second paragraph, by its terms, applies only to Hastings itself and to “Hastings-sponsored programs and activities.”  As already noted, Hastings characterizes RSOs as not being “Hastings-sponsored.”

Moreover, as is apparent from the list of prohibited types of discrimination (i.e., “race, color, religion, national origin, ancestry, disability, age, sex or sexual orientation”), the only forbidden category that restricts a group’s ability to be selective in terms of its members’ beliefs or viewpoints is the religious nondiscrimination requirement.  Similarly, the only one even arguably related to behavior is the sexual orientation nondiscrimination requirement.  Although on its face the sexual orientation nondiscrimination requirement might appear to apply only to an individual’s sexual inclinations or identity, Hastings has interpreted it to forbid discrimination on the basis of conduct as well, making homosexual conduct the only type of behavior addressed by the policy.

Supreme Court Precedents Supporting CLS’s Recognition Claim

CLS’s request for recognition is anchored in Supreme Court case law stretching over four decades in three areas: 1) student groups, including religious groups, have free speech and association rights to university recognition; 2) student activity fees must be allocated in a viewpoint neutral manner; and 3) expressive associations have a First Amendment  right to require their leaders and members to agree with the groups’ missions and messages.

Official recognition is a free speech and free association right:  In 1972, in Healy v. James, the Supreme Court held that a student chapter of a radical political group could not be denied official recognition by a public college based on its ideology.   In 1981, in Widmar v. Vincent, the Supreme Court extended Healy to require the University of Missouri to grant official recognition to a religious student group after the university denied access to meeting space because the group engaged in religious worship and instruction.  The Court specifically held that official recognition did not confer upon the religious group the university’s stamp of approval.

University funding must be available to student groups, including religious groups, on a viewpoint neutral basis:   In 1995, in Rosenberger v. University of Virginia, the Supreme Court required the University of Virginia to fund a religious student publication after the university denied funding solely because of the publication’s religious viewpoint.  In 2000, in Board of Regents v. Southworth, the Supreme Court ruled that the University of Wisconsin’s collection of mandatory student activity fees was constitutionally permissible only if the fees were allocated to student groups in a viewpoint neutral manner.

Expressive groups have an associational right to define their leadership and membership to protect their message:  In 1987, in Roberts v. Jaycees, the Court upheld application of a Minnesota antidiscrimination law to require the Jaycees to admit women to membership, ruling that it would not affect the business group’s message.  Concurring, Justice O’Connor observed, “the association’s right to define its membership derives from the recognition that the formation of an expressive association is the creation of a voice, and the selection of members is the definition of that voice.”  In 1995, in Hurley v. Irish-American Gay, Lesbian & Bisexual Group, the Court struck down Massachussetts’ application of its antidiscrimination law to require the organizers of a St. Patrick’s Day Parade to allow a contingent of individuals to march while carrying a banner proclaiming the group’s name.  Freedom of speech protected the parade organizers from forced inclusion of someone else’s message.  In 2000, in Boy Scouts v. Dale, the Court reversed New Jersey’s application of its antidiscrimination law to require the Boy Scouts to admit a homosexual person as an assistant scoutmaster.  According to the Court, the government must normally defer to a group’s decision as to whether inclusion of a leader or member would affect the group’s message.

Avoiding a Conflict Between Nondiscrimination Policies and First Amendment Rights

Too often, some public universities have begrudged religious student groups the rights secured in Widmar and Rosenberger.    Beginning around 1994, CLS and other religious student groups began encountering recognition problems, based on their practice of requiring leaders and members to share their religious beliefs and standards of conduct.

While preferring to resolve these problems without resort to litigation, CLS began to seek court protection when it was the only realistic option to regain recognition.  When a law school revoked recognition after a student, who admitted he disagreed with CLS’s basic beliefs, complained that he had not been allowed to lead a CLS Bible study, CLS sued to regain its recognition.   When Ohio State University’s law school revoked recognition to appease members of a homosexual student organization, CLS sued to recover recognition.  And when the Southern Illinois University Law School revoked CLS’s recognition, the Seventh Circuit Court of Appeals ruled in favor of CLS’s rights of free speech and expressive association.

Universities would benefit from including explicit language within a nondiscrimination policy, or at a minimum in their model constitutions for student groups.  Such language would clarify that student groups retain the right to ensure that their voting members and leaders share their fundamental beliefs, and thus that any nondiscrimination requirements based on beliefs exclude from their application groups formed around beliefs.  For example, in response to the CLS suit, the Ohio State University amended its registration guidelines for student organizations to include:  “A student organization formed to foster or affirm the sincerely held religious beliefs of its members may adopt a nondiscrimination statement that is consistent with those beliefs.”  In response to a lawsuit by a different Christian student group, which it had denied recognition because the group required its officers to share its Christian beliefs, the University of Florida recently added the following language to its nondiscrimination policy:  “A student organization whose primary purpose is religious will not be denied registration as a Registered Student Organization on the ground that it limits membership or leadership positions to students who share the religious beliefs of the organization.”  By the same token, if a university forbade discrimination based on political beliefs, it should exempt political groups from coverage.  It is one thing to say that the Chess Club may not exclude Republicans; it is quite another to say that Democrats have the right to vote in GOP Club elections.

Under a proper understanding of the First Amendment, CLS v. Martinez is most emphatically not a clash between religious freedom and rights pertaining to sexual orientation.  Religious groups and gay rights groups share common ground in the need for freedom of association.  Both can pursue their objectives best if free to decide for themselves who will lead and speak for them.  It is better to adhere to the First Amendment’s wisdom of “live and let live” than to treat religious and sexual orientation discrimination laws as a rationale for ostracizing dissenting viewpoints.

Professor Michael McConnell is Richard & Fraces Mallery Professor of Law at Stanford Law School and Formerly Circuit Judge, U.S. Court of Appeals for the Tenth Circuit.