(1) Enter repayment status on the first day of this first calendar month after

(i) The State has determined that the scholar is no longer pursuing a course of study leading to certification as a teacher at the preschool, elementary, or secondary level, but not before six months has elapsed after the cessation of the scholar's full-time enrollment in such a course of study;

(ii) The date the scholar informs the agency he or she does not plan to fulfill the teaching obligation; or

(iii) The latest date on which the scholar must have begun teaching in order to have completed the teaching obligation within ten years after completing the postsecondary education for which the scholarship was awarded, as determined by the State agency; and

(2) Make monthly or quarterly payments to the State which—

(i) Cover principal, interest, and collection costs according to a schedule established by the State which calls for complete repayment within ten years after the scholar enters repayment status, except as provided in paragraph (i) of this section; and

(ii) Amount annually to no less than $1,200 or the unpaid balance, whichever is less, unless the scholar's inability to pay this amount because of his or her financial condition has been established to the State's satisfaction.

(e) The State agency shall not require scholarship repayments amounting to more than $1,200 annually unless higher payments are needed to complete the entire repayment within the ten-year period described in paragraph (d)(2) of this section.

(f) The State agency shall capitalize any accrued interest at the time it establishes a scholar's repayment schedule.

(g) A scholar is not considered in violation of the repayment schedule established under paragraph (d) of this section during the time he or she is

(1) Engaging in a full-time course of study at an institution of higher education;

(2) Serving, not in excess of three years, on active duty as a member of the armed services of the United States;

(3) Temporarily totally disabled, for a period not to exceed three years, as established by sworn affidavit of a qualified physician;

(4) Unable to secure employment for a period not to exceed twelve months by reason of the care required by a spouse who is disabled;

(5) Seeking and unable to find fulltime employment for a single period not to exceed twelve months; or

(6) Unable to satisfy the terms of the repayment schedule established by the State under paragraph (d)(2)(i) of this section and is also seeking and unable to find full-time employment as a teacher in a public or private nonprofit preschool, elementary school, or secondary school, or in a public or private nonprofit preschool, elementary, or secondary education program for a single period not to exceed 27 months.

(h) To qualify for any of the exceptions in paragraph (g) of this section, a scholar shall notify the State agency of his or her claim to the exception and provide supporting documentation as required by the State agency.

(i) During the time a scholar qualifies for any of the exceptions in paragraph (g) of this section, he or she need not make the scholarship repayments referred to in paragraph (d) of this section and interest does not accrue.

(j) The State agency shall extend the ten-year scholarship repayment period established under paragraph (d) of this section by a period equal to the length of time a scholar meets any of the conditions listed in paragraph (g) of this section or if a scholar's inability to complete the scholarship repayments within this ten-year period because of his or here financial condition has been established to the State's satisfaction.

(k) The State agency shall cancel a scholar's repayment obligation if it determines

(1) On the basis of a sworn affidavit of a qualified physician, that the scholar is unable to teach on a fulltime basis because of an impairment that is expected to continue indefinitely or result in death; or

(2) On the basis of a death certificate or other evidence, conclusive

Subpart A-General

§ 654.1 What is the Robert C. Byrd Honors Scholarship Program?

(a) Under the Robert C. Byrd Honors Scholarship Program, the Secretary makes available, through grants to the States, scholarships to exceptionally able students for study at institutions of higher education in order to recognize and promote student excellence and achievement.

(b) This program is known as the "Byrd Scholarship Program" and scholarship recipients are known as "Byrd Scholars."

(Authority: 20 U.S.C. 1070d-31, 1070d-33)

§ 654.2 Who is eligible to apply for an award?

(a) States are eligible to apply for grants under this program.

(b) Outstanding high school graduates who have been accepted or have applied for enrollment at institutions of higher education are eligible to apply to their respective States of residence for scholarships under this program.

(Authority: 20 U.S.C. 1070d-33)

§ 654.3 What kinds of activities does the Robert C. Byrd Scholarship Program assist?

(a) An SEA may use its allotment under § 654.20(a) only for making payments to scholars.

(b) An SEA may use its allotment under § 654.20(b) for covering costs incurred in administering the program, as determined in accordance with 34 CFR Part 80, or for making payments to scholars.

(Authority: 20 U.S.C. 1070d-35, 1070d-38) § 654.4 What regulations apply?

The following regulations apply to the Robert C. Byrd Honors Scholarship Program:

(a) The Education Department General Administrative Regulations (EDGAR) in 34 CFR Part 76 (StateAdministered Programs), Part 77 (Definitions that Apply to Department Regulations), Part 80 (Uniform Administrative Requirements for Grants and Cooperative Agreements

State educational agency (SEA) (c) Other definitions. The following definitions also apply to this part: With respect to the postsecondary academic year, "academic year" means

(1) A period of time in which a fulltime student is expected to complete the equivalent of at least two semesters, two trimesters, or three quarters at an institution that measures academic progress in credit hours and uses a semester, trimester, or quarter system;

(2) A period of time in which a fulltime student is expected to complete at least 24 semester hours or 36 quarter hours at an institution that measures academic progress in credit hours but does not use a semester, trimester, or quarter system; or

(3) At least 900 clock hours at an institution that measures academic progress in clock hours.

Act means the Higher Education Act of 1965, as amended.

Award period means the period of time from April 1 of one year through March 31 of the following year.

Institution of higher education means any public or private nonprofit institution of higher education as defined in 34 CFR 600.4 of the Institutional Eligibility regulations.

Recognized equivalent of a high school diploma means

(1) A General Education Development (GED) Certificate; or

(2) A State certificate received by a student after the student has passed a State authorized examination that the State recognizes as the equivalent of a high school diploma.

Scholar means a Byrd Scholarship recipient.

Scholarship means an award made to an individual under this part.

(Authority: 20 U.S.C. 1070d-31 to 1070d-41)

Subpart B-How Does a State Apply for a Grant?

§ 654.10 What must a State do to receive a grant under this program?

(a) To receive a grant under the Byrd Scholarship Program, a State shall submit a participation agreement to the Secretary for review and approval.

(b) The Secretary approves a participation agreement if the agreement

(1) Provides that the State, through its SEA, agrees to administer the Byrd Scholarship Program in accordance with the requirements in this part;

(2) Describes the criteria and procedures that the SEA uses in the selection of scholars in sufficient detail for the Secretary to determine the degree to which they satisfy the provisions of this part; and

(3) Provides assurances that

(i) The SEA will make no changes in the criteria and procedures to be used in the selection of scholars without the prior written approval of the Secretary;

(ii) Each student receiving a Byrd Scholarship will meet the eligibility requirements described in § 654.41;

(iii) The SEA will select scholars solely on the basis of criteria and procedures established in accordance with the provisions of § 654.40;

(iv) The SEA will conduct outreach activities to publicize the availability of Byrd Scholarships to all seniors attending secondary schools in the State, with particular emphasis on activities designed to ensure that students from low-income and moderateincome families know about their opportunity for full participation in the program;

(v) The SEA will issue an award for $1,500 to each Byrd Scholar during an

awards ceremony to be held before the latest date on which any secondary school in the State completes its secondary academic year; and

(vi) The SEA will expend the amount of Federal funds allotted to it for this program only as described in § 654.3.

(c) Upon the Secretary's approval of its agreement, an SEA need not submit additional agreements in order to be considered for funding under this program in subsequent years.

(Approved by the Office of Management and Budget under control number 18400612)

(Authority: 20 U.S.C. 1070d-33, 1070d-35 to 1070d-39)

Subpart C-How Does the Secretary Make a Grant to an SEA?

§ 654.20 How does the Secretary allot funds to an SEA?

From the funds appropriated for the Byrd Scholarship Program, the Secretary allots to each SEA having an approved participation agreement under § 654.10

(a) $1,500 multiplied by the number of scholars the SEA may select under § 654.40(b)(1); and

(b) $10,000 plus 5 percent of the amount for which the SEA is eligible under paragraph (a) of this section. (Authority: 20 U.S.C. 1070d-34)

Subpart D-How Does an Individual Apply to an SEA for a Scholarship?

§ 654.30 How does an individual apply for a scholarship?

To apply for a scholarship, an individual shall follow the application procedures established by the SEA in the State in which the individual resides. (Authority: 20 U.S.C. 1070d-33, 1070d-35)

Subpart E-How Does an SEA Award a Scholarship to an Applicant?

§ 654.40 What are the selection criteria and procedures?

(a) The SEA shall establish criteria and procedures for the selection of scholars after consultation with school

administrators, school boards, teachers, counselors, and parents.

(b) The SEA shall design the selection criteria and procedures to ensure that it

(1) Selects ten scholars from among the residents of each Congressional district of the State for each award period for which funds are received, with the exception of the District of Columbia and the Commonwealth of Puerto Rico, which shall each establish procedures for the selection of 10 scholars from among its respective resident students for each year for which funds are received;

(2) Selects scholars solely on the basis of demonstrated outstanding academic achievement, promise of continued achievement; and the geographic consideration described in paragraph (b)(1) of this section, and— (3) Selects scholars

(i) Without regard to whether the secondary schools they attend are within or outside the scholars' Congressional districts or States of residency;

(ii) Without regard to whether the institutions of higher education they plan to attend are public or private or are within or outside the scholars' Congressional districts or States of residency;

(iii) Without regard to sex, race, handicapping condition, creed, or economic background; and

(iv) Without regard to their educational expenses or financial need. (Authority: 20 U.S.C. 1070d-33, 1070d-35 to 1070d-37)

§ 654.41 What are the requirements for a student to receive assistance under this program?

(a) To receive scholarship assistance, a student must

(1) During the same secondary academic year in which the scholarship is to be awarded

(i) Graduate from a secondary school, or receive a recognized equivalent of a high school diploma; and

(ii) Be accepted for enrollment at an institution of higher education;

(2) Be a resident of the State to which he or she is applying for a scholarship;

(3)(i) Be a U.S. citizen or national; or (ii) Provide evidence from the U.S. Immigration and Naturalization Service that he or she

(A) Is a permanent resident of the United States; or

(B) Is in the United States for other than a temporary purpose with the intention of becoming a citizen or permanent resident;

(4) File with the institution he or she plans to attend or is attending, a Statement of Selective Service Registration Status if required by the institution in accordance with the provisions of 34 CFR Part 668 of the Student Assistance General Provisions regulations; and

(5) Pursue a course of study at an institution of higher education, as described in paragraph (b) of this section.

(b)(1) For purposes of paragraph (a)(5) of this section, a scholar is deemed to be pursuing a course of study if he or she is enrolled at an institution of higher education as at least a half-time student, as determined by the institution he or she is attending under standards applicable to all students enrolled in that scholar's course of study.

(2) In accordance with such guidelines and standards as may be established by an SEA, a scholar who has been accepted for enrollment at an institution of higher education may, without forfeiting his or her scholarship, postpone his or her enrollment at the institution of higher education for up to a period of one year beginning on the date the scholar otherwise would have enrolled in the institution after the SEA awarded him or her the scholarship.

(Authority: 20 U.S.C. 1070d-36 to 1070d-38, 50 U.S.C. App 462)

Subpart F-What Postaward Conditions Must an SEA Meet?

§ 654.50 What requirement must an SEA meet in the administration of this program?

(a) To continue to receive payments under this part, an SEA shall—

(1) Provide scholarship assistance only to students who meet the requirements in § 654.41;

(2) Select scholars in accordance with the provisions in § 654.40;

(3) Award to each scholar only one scholarship in the amount of $1,500 to be used for the first academic year of study at an institution of higher education;

(4) Make arrangments, to the extent possible, to have scholarship awards presented to the scholars during a ceremony at a convenient location by Members of the Senate and Members of the House of Representatives who represent the State (or by the Delegate in the case of the District of Columbia or the Resident Commissioner in the case of the Commonwealth of Puerto Rico);

(5) Disburse the scholarship proceeds, in the form of a warrant, voucher, or check payable to the student or copayable to the student and an official of the institution of higher education in which the student enrolls, during the awards ceremony or after confirming that the scholar has met the requirements described in § 654.41; (6) Make no adjustments to the student's award because of the student's educational expenses or financial

need;

(7) Collect any scholarship funds disbursed to a student who fails to meet the requirements of § 654.41;

(8) Make reports to the Secretary that are necessary to carry out the Secretary's functions under this part; and

(9) Except as provided in paragraph (b) of this section, expend all funds received from the Secretary for scholarships during the award period specified by the Secretary with regard to those funds.

(b)(1) After awarding all scholarships during an award period, as required by paragraph (a)(9) of this section, an SEA may reserve for scholarship expenditures in the following award period any funds that have been awarded but are subsequently returned or recovered.

(2) An SEA may reserve for administrative costs or scholarship expenditures in the following award period any funds from its administrative cost