WASHINGTON, D.C. 20202



In the Matter of                                                                        Docket No. 01-12-SA



VALLEY BEAUTY SCHOOL,                                             Student Financial

                                                            Assistance Proceeding                                                                                                                          ACN:  09-99-05745               





Appearances:   Merlene K. Daggs, Owner, Page Antelope Valley Beauty School, for Respondent.


Stephen M. Kraut, Esq., Office of the General Counsel, United States Department of Education, Washington, D.C., for Student Financial Assistance Programs.


Before:             Richard I. Slippen, Administrative Judge




On March 30, 2001, Page Antelope Valley Beauty School (Page Antelope) appealed the U.S. Department of Educationís (Department) Final Audit Determination (FAD) dated February 15, 2001.  On May 4, 2001, I issued an Order Governing Proceedings in the above-captioned proceeding.  In my Order, Respondentís brief and exhibits were due on or before June 5, 2001.  Upon receipt of Respondentís brief and exhibits, SFAPís brief and exhibits were due on or before July 5, 2001.  Respondent has not submitted its brief nor requested an extension of time to file its submission.  On August 29, 2001, SFAP filed a motion for default judgment in this proceeding.[1]  On or before September 21, 2001, I ordered Respondent to show cause as to why I should not issue a default judgment in this proceeding.  To date, Respondent has failed to comply with my show cause order. 


The September 29, 2000, FAD charged that Page Antelope violated the institutional eligibility requirements of Title IV of the Higher Education Act of 1965, as amended (Title IV), 20 U.S.C. ß 1070 et seq.  In FAD Finding # 1, SFAP asserts that Page Antelope disbursed $10,347.00 in Federal Pell Grant and Supplemental Educational Opportunity Grant funds to students who were not eligible to receive them because they did not have a high school diploma or pass an approved ability-to-benefit test.  In Finding # 2, SFAP asserts that Page Antelope improperly disbursed $1,562 in Pell Grant funds to a student for whom the school failed to verify the studentís application information even though the student had been selected for verification.  In finding # 3, SFAP states that the school miscalculated a studentís refund, owing $163.00 to the Pell Grant Program.  In its motion, SFAP states that in settlement discussions, Page Valley submitted documentation demonstrating that one of the students in the first finding received a high school diploma and another student passed an ATB test.  SFAP also agrees that Page Antelope submitted documentation that it carried out the verification requirements for the student contained in Finding No. 2.  In sum, SFAP asserts that Page Antelopeís recalculated liability under the FAD is $4,323.  Due to the apparent transposition of two numbers, the recalculated liability is, in fact, $4,233 ($12,072-$6,187-$1,562 = $4,233).  


Pursuant to 34 C.F.R. ß 668.117(c)(3), I have the authority and responsibility to terminate the hearing process and issue a decision against a party if that party does not meet time limits established pursuant to my orders.  As such, I find that Respondentís failure to file a brief as ordered or respond to my Order to Show Cause warrants the termination of this proceeding.  Further, after a review of the FAD, I am convinced that the findings contained therein sufficiently state allegations in a manner that would require Page Antelope to carry its burden of proof in this proceeding.  34 C.F.R. ß 668.116(d).  Therefore, the FAD is affirmed and the recalculated liability upheld






On the basis of the foregoing, it is hereby ORDERED that Page Antelope Valley Beauty School pay to the U.S. Department of Education the sum of $4,233.







   Judge Richard I. Slippen



Dated:  October 5, 2001






A copy of the attached document was sent to the following:


Merlene K. Daggs


Page Antelope Valley Beauty School

547 W. Lancaster Blvd.

Lancaster, CA 93536


Stephen M. Kraut, Esq.

Office of the General Counsel

U.S. Department of Education

400 Maryland Avenue, S.W.

Washington, D.C. 20202-2110

[1] In its motion, SFAP states that on May 10, 2001, Page Antelopeís accrediting agency, the National Accrediting Commission of Cosmetology Arts (NACCAS) withdrew its accreditation of the school and that Page Antelope is now closed.  SFAP also states that Pageís Antelopeís eligibility to participate in the Title IV programs has been terminated.