A r c h i v e d  I n f o r m a t i o n

     FOR RELEASE                               Contact: Stephanie Babyak                                                         (202) 401-1576      June 19, 1996                                      Jane Glickman                                                         (202) 401-1576

First, he announced the appointment of Leo Kornfeld as the department's acting chief information officer. For the past two years, Kornfeld served as senior advisor to the secretary for direct lending.

At the same time, the department will complete the reintegration of the Federal Direct Student Loan Program into the Office of Student Financial Assistance, effective July 1. This move marks the completion of a plan instituted in 1994 to get direct lending operational.

The Office of Student Financial Assistance is headed by Elizabeth Hicks, deputy assistant secretary, who will now administer the Direct Loan program.

"The Department of Education is committed to the effective implementation of direct lending and the role of direct lending as a permanent part of student financial aid programs," Riley said. "With a solid foundation now in place, the direct loan program should be reintegrated into the management structure for our other student aid programs. This move will promote greater efficiency and coordination in the administration of the department's student aid programs.

"Leo Kornfeld has proven his effectiveness by launching the new Direct Loan program, a major initiative of the Clinton Administration, and he will now use his managerial and technical skills to carry out new responsibilities created by the Congress to improve all of the department's information systems," Riley continued. "Betsy Hicks is a talented and experienced student aid administrator who has the background, ability, and commitment necessary to continue the growth and improvement of the Direct Loan program."

Deputy Secretary Madeleine M. Kunin added: "These decisions give us the capacity to use our best talent in the right places, bringing our student loan programs under one roof with Betsy's leadership, and strengthening our overall information systems -- the key to all of our activities -- under Leo's guidance."

During the first year of the Direct Loan program's implementation, the department administratively separated the program on a temporary basis to give it extra attention and support during its startup phase. At that time, the department planned to reintegrate the Direct Loan program into the Office of Student Financial Assistance after two years. The process of reintegration began late last year.

Kornfeld's new post was created by Congress in the Information Technology Management Reform Act of 1996, which requires every cabinet-level agency to designate a CIO by August.

Kornfeld, who will report to the secretary, will be charged with improving the department's information systems in cooperation with senior management, and he will make recommendations to the secretary on the development of the CIO's office.

The Direct Loan program recently completed its second academic year of operation, a year that saw it grow from serving 5 percent to 35 percent of the national student loan volume. Kornfeld managed the implementation and expansion of the Direct Loan program, which served more than two million students at more than 1,350 institutions during academic 1995-96.

Kornfeld has significant management experience in government, education and the computer industry. He has served as president of two computer software companies, and was corporate group vice president for Automatic Data Processing, a major computer service corporation. Prior to joining the department in 1993, he was vice president for enrollment planning at Pace University. During the Carter Administration, he served as deputy commissioner of education for student financial assistance.

As head of the Office of Student Financial Assistance, Hicks has administered federal student financial aid programs that serve millions of students. Prior to joining the department, she spent 24 years in various financial aid capacities for Harvard University and Radcliffe College, including serving as coordinator of financial aid from 1983-95. She served previously as the director of financial aid at Tufts University School of Medicine. She is a former member of the Congressional Advisory Committee on Student Financial Assistance, and a former president of the Massachusetts Association of Student Financial Aid Administrators.