UNITED STATES COURT OF APPEALS FOR THE D.C. CIRCUIT


JORDAN, RENEE M.

v.

SECRETARY OF EDUC


99-5024a

D.C. Cir. 1999


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Silberman, Circuit Judge: Renee Jordan sought a dis- charge of her
federally guaranteed student loan because the  vocational school she
attended had falsely certified her ability  to benefit from its
training. The holder of her loan refused,  and the Secretary of
Education denied her appeal, on grounds  that she failed to satisfy a
regulation that requires students  seeking a discharge to demonstrate
an inability to find a job.  When Jordan sued the Secretary, the
district court granted  summary judgment against her. We hold that the
regulation  is inconsistent with the governing statute, and thus


I.


Under the Federal Family Education Loan Program, pri- vate lenders make
loans for "eligible borrowers" to attend  "eligible" post-secondary
institutions. See 20 U.S.C. s 1071  et seq.1 State and private
guaranty agencies insure the loans,  and the Secretary of Education
reinsures the agencies. Gen- erally, eligible borrowers are those who
have a high school  diploma or a GED. However, an individual without a
diploma  or GED may qualify to attend a vocational school if the
school  certifies that she has the "ability to benefit" from the
training  it provides. Under s 1091(d), a student may demonstrate an 
ability to benefit in one of three ways: (1) by earning a GED  before
graduation from the program or by the end of the first  year of study;
(2) by being counseled before admission and  completing a prescribed
program of remedial education; or  (3) by passing "a nationally
recognized, standardized or indus- try developed test" that measures
"the applicant's aptitude to  complete successfully the program to
which the applicant has  applied."




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n 1 We discuss the statute as it existed at the time of the events at 
issue in this case. Congress has since made extensive changes to  the
statutory scheme.


In 1992, in response to public concern about vocational  schools that
defrauded students by falsely certifying their  ability to benefit and
then providing them worthless training,  Congress provided that if a
"student's eligibility to borrow  under this part was falsely
certified by the eligible institution  ... then the Secretary shall
discharge the borrower's liability  on the loan." 20 U.S.C. s
1087(c)(1). The agency holding  the loan decides whether to grant a
discharge, subject to  review by the Secretary. See 34 C.F.R. s
682.402(e). A  student must submit a written statement affirming that
she  was admitted to a school on the basis of ability to benefit but 
did not satisfy the ability to benefit requirements. If the  student
completed the program, she also must state that she  "made a
reasonable attempt to obtain employment in the  occupation for which
the program was intended to provide  training, and--(1) Was not able
to find employment in that  occupation; or (2) Obtained employment in
that occupation  only after receiving additional training that was not
provided  by the school that certified the loan." Section 


Jordan completed a six-month course at the National Busi- ness School's
Law Enforcement Academy (NBS) in the Dis- trict of Columbia. When she
was admitted to the school in  1987, she did not have a high school
diploma or GED, and she  did not meet the requirements of s 1091(d).
Nevertheless,  NBS arranged for Jordan to obtain a guaranteed student 
loan. Jordan's experience was apparently not unique: an  investigation
by the Department of Education's Inspector  General and the FBI
revealed that the school admitted  unqualified students by improperly
administering entrance  examinations, in some cases by giving students
the answers.


After her graduation from NBS, Jordan sought employ- ment as a security
officer. She answered a newspaper adver- tisement for security
officers, but she was told that she would  have to start at what she
described as "an unacceptably low  salary" because she lacked a high
school degree. The record  is not entirely clear on whether Jordan was
denied a position  or was offered a position that she declined. In any
event,  Jordan submitted a request for a discharge to the holder of 


her loan, the Nebraska Student Loan Program. That agency  denied her
request, because she had been offered a job that  she declined. The
holder also relied upon a policy statement  issued by the Deputy
Assistant Secretary stating that, absent  "unusual circumstances," a
guaranty agency could reasonably  "consider three separate attempts by
the student to find a  job" persuasive evidence that the student had
complied with  34 C.F.R. s 682.402(e)(3)(ii)(C). The Secretary denied
Jor- dan's appeal on the ground that she had been able to find 
employment but simply declined the job she was offered.


Jordan then brought this action claiming that the subse- quent
employment conditions in the regulation exceeded the  Secretary's
authority under the statute. The district court  granted the
Secretary's motion for summary judgment. See  Jordan v. Riley, 26 F.
Supp. 2d 173 (D.D.C. 1998). The court  held that the regulation was a
permissible interpretation of  the ambiguity created by the undefined
term "falsely certi- fied." For purposes of summary judgment, it
assumed that  Jordan had been denied a job, but it held that the
regulatory  requirement of "a reasonable attempt to obtain employment"
 could not be satisfied by only one unsuccessful attempt to find 
employment, because "[a] sample size of one is too small" for  a
student to demonstrate an inability to get a job. Id. at 179.  Jordan


II.


Jordan contends that the regulation at issue is inconsistent  with the
statute and therefore fails the first step of the  analysis in Chevron
U.S.A. Inc. v. Natural Resources Defense  Council, Inc., 467 U.S. 837
(1984). The first part of the  regulation, it is argued, simply
mirrors the statutory require- ment that the student has been admitted
to a school on the  basis of ability to benefit without actually
satisfying the  ability to benefit test. The second part, however,
demands  that the student have made an unsuccessful effort to find 
employment. This condition, appellant argues, is found no- where in
the statute, and for the Secretary to impose it is to  violate the
congressional command that he "shall discharge 


the borrower's liability" if statutory criteria are violated.  Jordan
also argues that, even if the regulation were valid, the  district
court erred in applying a three-attempt rule, because  that rule was
found only in a policy statement, and, in any  event, the Secretary
did not rely on it.


The Secretary justifies the regulation by pointing out that  the
statute does not define the term "falsely certified." He  refers to
the dictionary definition of "false" as "contrary to  truth or fact"
and reasons that "one way to determine wheth- er Ms. Jordan's ability
to benefit from security guard training  was falsely certified in 1987
is to examine whether she in fact  had the ability to benefit from
that training," as measured by  whether she subsequently found a job.
On his view, under  Chevron the regulation is a reasonable
interpretation of an  ambiguous statute.


Ambiguity, of course, "is a creature not of definitional  possibilities
but of statutory context." Brown v. Gardner,  513 U.S. 115, 118
(1994). The Secretary ignores that context,  for he overlooks that
"ability to benefit" is defined in specific  terms in the statute. A
school does not certify a student's  general "ability" measured at the
time of certification--still  less as to be determined in the future.
Rather, it certifies  that the student meets the particular conditions
of s 1091(d).  Because the school is never asked to certify (predict)
that a  student will find a job, a student's post-training employment 
experience is irrelevant to the truth or falsity of the certifica-
tion. The Secretary appears to recognize as much, for anoth- er
provision of the same regulation already provides a defini- tion of
"falsely certified," one that is based solely on whether  the student
met the objective criteria for certification before  being admitted.
See 34 C.F.R. s 682.402(e)(1)(i).


In other words, the statutory scheme is designed to place  obligations
on schools, which must certify ability to benefit,  and on the
government, which must police schools to ensure  that their
certifications are accurate, or failing that must  compensate
defrauded students. Under the regulation, a  burden is shifted to the
student: she is obliged to seek a job  before she may claim the
benefit of a discharge. Thus, the 


Secretary has done more than simply add an obligation that is  not in
the statute; he has changed the nature of the statute.


It would be absurd, the Secretary argues, to allow students  to obtain
discharges simply because of trivial technical defects  in the tests
that were used to measure their ability to benefit.  So it would. That
proposition is not in dispute: Jordan  concedes that the Secretary
could issue a regulation defining  "falsely certified" in such a way
as to exclude certifications  that were defective because, for
example, the student wrongly  took a photocopied version of the test
rather than the origi- nal. Indeed, the Secretary has already issued
an interpretive  policy statement to that effect. The legality of a
"harmless  error" rule cannot justify this regulation, which has a
policy  objective far exceeding the statutory framework.


Ultimately, the Secretary relies on a policy argument: that  students
who gain the benefit of the training should not get a  windfall by
avoiding their loan obligations.2 He attempts to  tie that policy
objective to the legislative history. He refers  to a committee report
indicating that Congress was concerned  that students whose
eligibility was falsely certified were "left  without the skills
needed to obtain employment and conse- quently did not have the means
to repay the loans." H.R.  Rep. No. 447, 102d Cong., 2d Sess. 52
(1992). From this he  infers that Congress intended to discharge the
loans only of  students who were unable to find employment. We think 
that is an inference too far. Be that as it may, the Secretary 
confuses the subjective intentions of the members of Con- gress with
the statute that Congress actually enacted. Cf.  Oncale v. Sundowner
Offshore Servs., Inc., 523 U.S. 75, 79  (1998) ("[I]t is ultimately
the provisions of our laws rather  than the principal concerns of our
legislators by which we are  governed."). The Secretary may not
rewrite the statute,  even if the enacting Congress might have




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n 2 The Secretary's regulation has its own perverse consequence.  Even
if a student received zero training--let us say the school was  a
total sham--the student would be obliged to pay, if by dint of  drive
and good fortune he or she happened to get a job.


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The judgment of the district court is reversed, and the case  is
remanded for further proceedings consistent with this  opinion.


So ordered.