Ask A Simple Question...

It's a question that I get asked all the time: How well are borrowers in the Direct Lending program being served today?  So, on August 20th, I emailed the Department of Education the following FOIA request:

"The performance ratings that the Department of Education has collected in the evaluation of the current DL servicer, ACS."

Seems kinda simple, right?  I got my answer this week, which included the following paragraph (FOIA's version of the dreaded "Dear John" letter): 

"Under the above mentioned statutes, agency evaluations of contractor performance prepared under this subpart...may be used to support future award decisions, and should therefore be marked "Source Selection Information"...The completed evaluation shall not be released to other than Government personnel and the contractor whose performance is being evaluated during the period the information may be be used to provide source selection information.  Disclosure of such information could cause harm both to the commercial interest of the Government and to the competitive position of the contractor being evaluated as well as impede the efficiency of Government operations.  Evaluations used in determining award or incentive fee payments may also be used to satisfy the requirements of this subpart.  A copy of the annual or final past performance evaluation shall be provided to the contractor as soon as it is finalized."

So, I guess it will be left unanswered as to how well students are being served by the current DL loan servicer, ACS (one can make assumptions based on the fact that they were the only one of the five finalists not selected).  Given that 100% of federal loans will be serviced by four outside contractors, starting in July 2010, does that mean that the all-important annual evaluations, which will be used to allocate loans to these servicers, will also remain out of the public eye?  Doesn't the public deserve to know how servicers are faring based on public disclosure of default rates and customer survey scores from students, financial aid offices and the FSA, which will determine their allocation.  This lack of transparency is astounding.  I hope this policy changes. 

Comments

[FinAid Administrator]

Hi Tim. Thank you for the great info you continue to post to the SLA blog. I'd like to offer comments on "Ask a Simple question." You should not assume that ACS's unsuccessful bid was due to servicing. There were many issues considered - and a significant one was cost. It is likely that the issue may have been pricing. Also...I do agree with you on the FOIA frustrations. Have you thought of requesting info from the Dept of Ed Ombudsman on complaints on servicing made by by FFELP and DL borrowers? Perhaps that doesn't have FOIA restrictions....