Source document: https://docs-lawep.s3.us-east-2.amazonaws.com/1696578100271.pdf (United States)
G:\COMP\EDIII\HIGHER EDUCATION ACT OF 1965.XML Higher Education Act of 1965 [P.L.

89–329; Approved November 8, 1965] [As Amended Through P.L.

117–286, Enacted December 27, 2022] øCurrency: This publication is a compilation of the text of Public Law 89-329.
It was last amended by the public law listed in the As Amended Through note above and below at the bottom of each page of the pdf version and reflects current law through the date of the enactment of the public law listed at https:// www.govinfo.gov/app/collection/comps/¿ øNote: While this publication does not represent an official version of any Federal statute, substantial efforts have been made to ensure the accuracy of its contents.
The official version of Federal law is found in the United States Statutes at Large and in the United States Code.

The legal effect to be given to the Statutes at Large and the United States Code is established by statute (1 U.S.C.

112, 204).¿ Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That this Act may be cited as the ‘‘Higher Education Act of 1965’’.
1 øThe table of contents is not part of the law and is provided for the convenience of the reader.¿ TITLE I—GENERAL PROVISIONS PART A—DEFINITIONS Sec.

101. ø20 u.s.c.

1001¿ general definition of institution of higher education.

Sec.

102. ø20 u.s.c.

1002¿ definition of institution of higher education for purposes Sec.

103. ø20 u.s.c.

1003¿ additional definitions.

of title iv programs.

PART B—ADDITIONAL GENERAL PROVISIONS Sec.

111. ø20 u.s.c.

1011¿ antidiscrimination.

Sec.

112. ø20 u.s.c.


1011a¿ protection of student speech and association rights.

Sec.

113. ø20 u.s.c.

1011b¿ territorial waiver authority.

Sec.

114. ø20 u.s.c.

1011c¿ national advisory committee on institutional quality and integrity.

Sec.

115. ø20 u.s.c.

1011d¿ student representation.

Sec.

116. ø20 u.s.c.

1011e¿ financial responsibility of foreign students.

Sec.

117. ø20 u.s.c.

1011f¿ disclosures of foreign gifts.

Sec.

118. ø20 u.s.c.


1011g¿ application of peer review process.

Sec.

119. ø20 u.s.c.

1011h¿ binge drinking on college campuses.

Sec.

120. ø20 u.s.c.

1011i¿ drug and alcohol abuse prevention.

1 Effective on July 1, 2024, paragraphs (1) through (4) of section 704 of division FF of Public Law 116–260 provide for global type amendments to the Higher Education Act of 1965.
Ref- erences to these pending global amendments will appear following a footnote reference that redi- rects the user to this footnote.

Section 704(1)–(4) of such Public Law states as follows: Sec.

704.

CONFORMING AMENDMENTS.

The Higher Education Act of 1965 (20 U.S.C.

1001 et seq.)
is amended— (1) by striking ‘‘the expected family contribution’’ each place the term appears and inserting ‘‘the student aid index’’; (2) by striking ‘‘expected family contributions’’ each place the term appears and inserting ‘‘stu- dent aid indexes’’; (3) by striking ‘‘an expected family contribution’’ each place the term appears and inserting ‘‘a student aid index’’; (4) by striking ‘‘average expected family contribution’’ each place the term appears and insert- ing ‘‘average student aid index’’; 1 September 8, 2023 As Amended Through P.L.
117-286, Enacted December 27, 2022 HOLC G:\COMP\EDIII\HIGHER EDUCATION ACT OF 1965.XML HIGHER EDUCATION ACT OF 1965 2 Sec.

121. ø20 u.s.c.

1011j¿ prior rights and obligations.

Sec.

122. ø20 u.s.c.

1011k¿ recovery of payments.

Sec.

123. ø20 u.s.c.

1011l¿ diploma mills.

PART C—COST OF HIGHER EDUCATION Sec.

131. ø20 u.s.c.
131. ø20 u.s.c.

1015¿ improvements in market information and public account- ability in higher education.

Sec.

132. ø20 u.s.c.

1015a¿ transparency in college tuition for consumers.

Sec.

133. ø20 u.s.c.

1015b¿ textbook information.

Sec.

134. ø20 u.s.c.

1015c¿ database of student information prohibited.

Sec.

135. ø20 u.s.c.

1015d¿ in-state tuition rates for members of the armed forces Sec.

136. ø20 u.s.c.
136. ø20 u.s.c.

1015e¿ State higher education information system pilot pro- on active duty, spouses, and dependent children.

Sec.

137. ø20 u.s.c.

1015f¿ State commitment to affordable college education.

gram.

PART D—ADMINISTRATIVE PROVISIONS FOR DELIVERY OF STUDENT FINANCIAL ASSISTANCE Sec.

141. ø20 u.s.c.

1018¿ performance-based organization for the delivery of Fed- eral student financial assistance.

Sec.

142. ø20 u.s.c.

1018a¿ procurement flexibility.

Sec.

143. ø20 u.s.c.


1018b¿ administrative simplification of student aid delivery.

PART E—LENDER AND INSTITUTION REQUIREMENTS RELATING TO EDUCATION LOANS Sec.

151. ø20 u.s.c.

1019¿ definitions.

Sec.

152. ø20 u.s.c.

1019a¿ responsibilities of covered institutions, institution-affili- ated organizations, and lenders.

Sec.

153. ø20 u.s.c.


1019b¿ loan information to be disclosed and model disclosure form for covered institutions, institution-affiliated organizations, and lenders participating in preferred lender arrangements.

Sec.

154. ø20 u.s.c.

1019c¿ loan information to be disclosed and model disclosure form for institutions participating in the william.

D. Ford Federal di- rect loan program.

Sec.

155. ø20 u.s.c.

1019d¿ self-certification form for private education loans.
TITLE II—TEACHER QUALITY ENHANCEMENT Sec.

200. ø20 u.s.c.

1021¿ definitions.

PART A—TEACHER QUALITY PARTNERSHIP GRANTS Sec.

201. ø20 u.s.c.

1022¿ purposes.

Sec.

202. ø20 u.s.c.

1022a¿ partnership grants.

Sec.

203. ø20 u.s.c.

1022b¿ administrative provisions.

Sec.

204. ø20 u.s.c.

1022c¿ accountability and evaluation.

Sec.

205. ø20 u.s.c.

1022d¿ accountability for programs that prepare teachers.

Sec.

206. ø20 u.s.c.

1022e¿ teacher development.

Sec.

207. ø20 u.s.c.


1022f¿ State functions.

Sec.

208. ø20 u.s.c.

1022g¿ general provisions.

Sec.

209. ø20 u.s.c.

1022h¿ authorization of appropriations.

Sec.

230. ø20 u.s.c.

1031¿ authorization of appropriations.

PART B—ENHANCING TEACHER EDUCATION SUBPART 1—PREPARING TEACHERS FOR DIGITAL AGE LEARNERS Sec.

231. ø20 u.s.c.

1032¿ program authorized.

Sec.

232. ø20 u.s.c.

1032a¿ uses of funds.

Sec.

233. ø20 u.s.c.

1032b¿ application requirements.

Sec.


234. ø20 u.s.c.

1032c¿ evaluation.

SUBPART 2—HONORABLE AUGUSTUS F. HAWKINS CENTERS OF EXCELLENCE Sec.

241. ø20 u.s.c.

1033¿ definitions.

Sec.

242. ø20 u.s.c.

1033a¿ augustus f. Hawkins centers of excellence.

SUBPART 3—PREPARING GENERAL EDUCATION TEACHERS TO MORE EFFECTIVELY EDUCATE STUDENTS WITH DISABILITIES Sec.

251. ø20 u.s.c.

1034¿ teach to reach grants.

September 8, 2023 As Amended Through P.L.


117-286, Enacted December 27, 2022 HOLC G:\COMP\EDIII\HIGHER EDUCATION ACT OF 1965.XML 3 HIGHER EDUCATION ACT OF 1965 Sec.

255. ø20 u.s.c.

1035¿ adjunct teacher corps.

SUBPART 4—ADJUNCT TEACHER CORPS SUBPART 5—GRADUATE FELLOWSHIPS TO PREPARE FACULTY IN HIGH- NEED AREAS AT COLLEGES OF EDUCATION Sec.

258. ø20 u.s.c.
258. ø20 u.s.c.

1036¿ graduate fellowships to prepare faculty in high-need areas at colleges of education.

PART C—GENERAL PROVISIONS Sec.

261. ø20 u.s.c.

1041¿ limitations.

Sec.

301. ø20 u.s.c.

1051¿ findings and purposes.

TITLE III—INSTITUTIONAL AID PART A—STRENGTHENING INSTITUTIONS Sec.

311. ø20 u.s.c.

1057¿ program purpose.

Sec.

312. ø20 u.s.c.

1058¿ definitions; eligibility.

Sec.

313. ø20 u.s.c.

1059¿ duration of grant.

Sec.

314. ø20 u.s.c.

1059a¿ applications.

Sec.

315. ø20 u.s.c.


1059b¿ goals for financial management and academic program.

Sec.

316. ø20 u.s.c.

1059c¿ american indian tribally controlled colleges and univer- sities.

Sec.

317. ø20 u.s.c.

1059d¿ alaska native and native hawaiian-serving institutions.

Sec.

318. ø20 u.s.c.

1059e¿ predominantly black institutions.

Sec.

319. ø20 u.s.c.

1059f¿ native american-serving, nontribal institutions.

Sec.

320. ø20 u.s.c.


1059g¿ asian american and native american pacific islander- serving institutions.

PART B—STRENGTHENING HISTORICALLY BLACK COLLEGES AND UNIVERSITIES Sec.

321. ø20 u.s.c.

1060¿ findings and purposes.

Sec.

322. ø20 u.s.c.

1061¿ definitions.

Sec.

323. ø20 u.s.c.

1062¿ grants to institutions.

Sec.

324. ø20 u.s.c.

1063¿ allotments to institutions.

Sec.

325. ø20 u.s.c.

1063a¿ applications.

Sec.

326. ø20 u.s.c.

1063b¿ professional or graduate institutions.

Sec.
Sec.

327. ø20 u.s.c.

1063c¿ reporting and audit requirements.

PART C—ENDOWMENT CHALLENGE GRANTS FOR INSTITUTIONS ELIGIBLE FOR ASSISTANCE UNDER PART A OR PART B Sec.

331. ø20 u.s.c.

1065¿ endowment challenge grants.

PART D—HISTORICALLY BLACK COLLEGE AND UNIVERSITY CAPITAL FINANCING Sec.

341. ø20 u.s.c.

1066¿ findings.

Sec.

342. ø20 u.s.c.

1066a¿ definitions.

Sec.

343. ø20 u.s.c.

1066b¿ Federal insurance for bonds.

Sec.

344. ø20 u.s.c.


1066c¿ limitations on Federal insurance for bonds issued by the designated bonding authority.

Sec.

345. ø20 u.s.c.

1066d¿ authority of the secretary.

Sec.

347. ø20 u.s.c.

1066f¿ hbcu capital financing advisory board.

Sec.

348. ø20 u.s.c.

1066g¿ minority business enterprise utilization.

PART E—MINORITY SCIENCE AND ENGINEERING IMPROVEMENT PROGRAM Subpart 1—Minority Science and Engineering Improvement Program Sec.

350. ø20 u.s.c.

1067¿ findings.

Sec.

351. ø20 u.s.c.


1067a¿ purpose; authority.

Sec.

352. ø20 u.s.c.

1067b¿ grant recipient selection.

Sec.

353. ø20 u.s.c.

1067c¿ use of funds.

SUBPART 2—PROGRAMS IN STEM FIELDS Sec.

355. ø20 u.s.c.

1067e¿ yes partnerships grant program.

Sec.

356. ø20 u.s.c.

1067e–1¿ promotion of entry into stem fields.

Sec.

357. ø20 u.s.c.

1067e–2¿ evaluation and accountability plan.

Subpart 3—Administrative and General Provisions Sec.

361. ø20 u.s.c.

1067g¿ eligibility for grants.


September 8, 2023 As Amended Through P.L.

117-286, Enacted December 27, 2022 HOLC G:\COMP\EDIII\HIGHER EDUCATION ACT OF 1965.XML HIGHER EDUCATION ACT OF 1965 4 Sec.

362. ø20 u.s.c.

1067h¿ grant application.

Sec.

363. ø20 u.s.c.

1067i¿ cross program and cross agency cooperation.

Sec.

364. ø20 u.s.c.

1067j¿ administrative provisions.

Sec.


365. ø20 u.s.c.

1067k¿ definitions.

PART F—STRENGTHENING HISTORICALLY BLACK COLLEGES AND UNIVERSITIES AND OTHER MINORITY-SERVING INSTITUTIONS Sec.

371. ø20 u.s.c.

1067q¿ investment in historically black colleges and univer- sities and other minority-serving institutions.

PART G—GENERAL PROVISIONS Sec.

391. ø20 u.s.c.

1068¿ applications for assistance.

Sec.

392. ø20 u.s.c.

1068a¿ waiver authority and reporting requirement.

Sec.

393. ø20 u.s.c.


1068b¿ application review process.

Sec.

394. ø20 u.s.c.

1068c¿ cooperative arrangements.

Sec.

395. ø20 u.s.c.

1068d¿ assistance to institutions under other programs.

Sec.

396. ø20 u.s.c.

1068e¿ limitations.

Sec.

397. ø20 u.s.c.

1068f¿ penalties.

Sec.

398. ø20 u.s.c.

1068g¿ continuation awards.

Sec.

399. ø20 u.s.c.

1068h¿ authorizations of appropriations.

TITLE IV—STUDENT ASSISTANCE PART A—GRANTS TO STUDENTS IN ATTENDANCE AT INSTITUTIONS OF HIGHER EDUCATION Sec.
400. ø20 u.s.c.

1070¿ Statement of purpose; program authorization.

SUBPART 1—FEDERAL PELL GRANTS Sec.

401. ø20 u.s.c.

1070a¿ Federal pell grants: amount and determinations; appli- Sec.

401A.

Academic competitiveness grants.

cations.

SUBPART 2—FEDERAL EARLY OUTREACH AND STUDENT SERVICES PROGRAMS CHAPTER 1—FEDERAL TRIO PROGRAMS Sec.

402A.

ø20 u.s.c.

1070a–11¿ program authority; authorization of appropriations.

Sec.

402B.

ø20 u.s.c.

1070a–12¿ talent search.

Sec.

402C.

ø20 u.s.c.


1070a–13¿ upward bound.

Sec.

402D.

ø20 u.s.c.

1070a–14¿ student support services.

Sec.

402E.

ø20 u.s.c.

1070a–15¿ postbaccalaureate achievement program authority.

Sec.

402F.

ø20 u.s.c.

1070a–16¿ educational opportunity centers.

Sec.

402G.

ø20 u.s.c.

1070a–17¿ staff development activities.

Sec.

402H.

ø20 u.s.c.

1070a–18¿ reports, evaluations, and grants for project im- provement and dissemination.
CHAPTER 2—GAINING EARLY AWARENESS AND READINESS FOR UNDERGRADUATE PROGRAMS Sec.

404A.

ø20 u.s.c.

1070a–21¿ early intervention and college awareness program authorized.

Sec.

404B.

ø20 u.s.c.

1070a–22¿ requirements.

Sec.

404C.

ø20 u.s.c.

1070a–23¿ applications.

Sec.

404D.

ø20 u.s.c.

1070a–24¿ activities.

Sec.

404E.

ø20 u.s.c.

1070a–25¿ scholarship component.

Sec.

404F.

ø20 u.s.c.

1070a–26¿ 21st century scholar certificates.

Sec.

404G.

ø20 u.s.c.

1070a–27¿ evaluation and report.


Sec.

404H.

ø20 u.s.c.

1070a–28¿ authorization of appropriations.

Subpart 3—Federal Supplemental Educational Opportunity Grants Sec.

413A.

ø20 u.s.c.

1070b¿ purpose; appropriations authorized.

Sec.

413B.

ø20 u.s.c.

1070b–1¿ amount and duration of grants.

Sec.

413C.

ø20 u.s.c.

1070b–2¿ agreements with institutions; selection of recipients.

Sec.

413D.

ø20 u.s.c.

1070b–3¿ allocation of funds.

Sec.

413E.

ø20 u.s.c.


1070b–4¿ carryover and carryback authority.

Subpart 4—Leveraging Educational Assistance Partnership Program Sec.

415A.

ø20 u.s.c.

1070c¿ purpose; appropriations authorized.

September 8, 2023 As Amended Through P.L.

117-286, Enacted December 27, 2022 HOLC G:\COMP\EDIII\HIGHER EDUCATION ACT OF 1965.XML 5 HIGHER EDUCATION ACT OF 1965 Sec.

415B.

ø20 u.s.c.
415B.

ø20 u.s.c.

1070c–1¿ allotment among States.

Sec.

415C.

ø20 u.s.c.

1070c–2¿ applications for leveraging educational assistance partnership programs.

Sec.

415D.

ø20 u.s.c.

1070c–3¿ administration of State programs; judicial review.

Sec.

415E.

ø20 u.s.c.

1070c–3a¿ grants for access and persistence.

Sec.

415F.

ø20 u.s.c.

1070c–4¿ definition.

Subpart 5—Special Programs for Students Whose Families Are Engaged in Migrant and Seasonal Farmwork Sec.

418A.

ø20 u.s.c.
418A.

ø20 u.s.c.

1070d–2¿ maintenance and expansion of existing programs.

Subpart 6—Robert C. Byrd Honors Scholarship Program Sec.

419A.

ø20 u.s.c.

1070d–31¿ Statement of purpose.

Sec.

419C.

ø20 u.s.c.

1070d–33¿ scholarships authorized.

Sec.

419D.

ø20 u.s.c.

1070d–34¿ allocation among States.

Sec.

419E.

ø20 u.s.c.

1070d–35¿ agreements.

Sec.

419F.

ø20 u.s.c.

1070d–36¿ eligibility of scholars.

Sec.

419G.

ø20 u.s.c.

1070d–37¿ selection of scholars.

Sec.

419H.

ø20 u.s.c.


1070d–38¿ stipends and scholarship conditions.

Sec.

419J.

ø20 u.s.c.

1070d–40¿ construction of needs provisions.

Sec.

419K.

ø20 u.s.c.

1070d–41¿ authorization of appropriations.

SUBPART 7—CHILD CARE ACCESS MEANS PARENTS IN SCHOOL Sec.

419N.

ø20 u.s.c.

1070e¿ child care access means parents in school.

SUBPART 9—TEACH GRANTS Sec.

420L.

ø20 u.s.c.

1070g¿ definitions.

Sec.

420M.

ø20 u.s.c.

1070g–1¿ program established.

Sec.

420N.

ø20 u.s.c.


1070g–2¿ applications; eligibility.

Sec.

420O.

ø20 u.s.c.

1070g–3¿ program period and funding.

Sec.

420P.

ø20 u.s.c.

1070g–4¿ program report.

SUBPART 10—SCHOLARSHIPS FOR VETERAN’S DEPENDENTS Sec.

420R.

ø20 u.s.c.

1070h¿ scholarships for veteran’s dependents.

PART B—FEDERAL FAMILY EDUCATION LOAN PROGRAM Sec.

421. ø20 u.s.c.

1071¿ Statement of purpose; nondiscrimination; and appropria- Sec.

422. ø20 u.s.c.
422. ø20 u.s.c.

1072¿ advances for reserve funds of State and nonprofit private tions authorized.

loan insurance programs.

Sec.

422A.

ø20 u.s.c.

1072a¿ Federal student loan reserve fund.

Sec.

422B.

ø20 u.s.c.

1072b¿ agency operating fund.

Sec.

423. ø20 u.s.c.

1073¿ effects of adequate non-Federal programs.

Sec.

424. ø20 u.s.c.

1074¿ scope and duration of Federal loan insurance program.

Sec.

425. ø20 u.s.c.


1075¿ limitations on individual federally insured loans and on Federal loan insurance.

Sec.

426. ø20 u.s.c.

1076¿ sources of funds.

Sec.

427. ø20 u.s.c.

1077¿ eligibility of student borrowers and terms of federally in- sured student loans.

Sec.

427A.

ø20 u.s.c.

1077a¿ applicable interest rates.

Sec.

428. ø20 u.s.c.

1078¿ Federal payments to reduce student interest costs.

Sec.

428A.

ø20 u.s.c.

1078–1¿ voluntary flexible agreements with guaranty agen- cies.

Sec.

428B.
Sec.

428B.

ø20 u.s.c.

1078–2¿ Federal plus loans.

Sec.

428C.

ø20 u.s.c.

1078–3¿ Federal consolidation loans.

Sec.

428D.

ø20 u.s.c.

1078–4¿ commingling of funds.

Sec.

428F.

ø20 u.s.c.

1078–6¿ default reduction program.

Sec.

428G.

ø20 u.s.c.

1078–7¿ requirements for disbursement of student loans.

Sec.

428H.

ø20 u.s.c.

1078–8¿ unsubsidized stafford loans for middle-income bor- rowers.

Sec.

428J.

ø20 u.s.c.

1078–10¿ loan forgiveness for teachers.

Sec.

428K.

ø20 u.s.c.


1078–11¿ loan forgiveness for service in areas of national need.

Sec.

428L.

ø20 u.s.c.

1078–12¿ loan repayment for civil legal assistance attorneys.

Sec.

429. ø20 u.s.c.

1079¿ certificate of Federal loan insurance—effective date of in- surance.

September 8, 2023 As Amended Through P.L.


117-286, Enacted December 27, 2022 HOLC G:\COMP\EDIII\HIGHER EDUCATION ACT OF 1965.XML HIGHER EDUCATION ACT OF 1965 6 Sec.

430. ø20 u.s.c.

1080¿ default of student under Federal loan insurance program.

Sec.

430A.

ø20 u.s.c.

1080a¿ reports to consumer reporting agencies and institu- tions of higher education.

Sec.

431. ø20 u.s.c.


1081¿ insurance fund.

Sec.

432. ø20 u.s.c.

1082¿ legal powers and responsibilities.

Sec.

433. ø20 u.s.c.

1083¿ student loan information by eligible lenders.

Sec.

433A.

ø20 u.s.c.

1083a¿ consumer education information.

Sec.

434. ø20 u.s.c.

1084¿ participation by Federal credit unions in federal, State, and private student loan insurance programs.

Sec.

435. ø20 u.s.c.

1085¿ definitions for student loan insurance program.

Sec.

436. ø20 u.s.c.


1086¿ delegation of functions.

Sec.

437. ø20 u.s.c.

1087¿ repayment by the secretary of loans of bankrupt, de- ceased, or disabled borrowers; treatment of borrowers attending schools that fail to provide a refund, attending closed schools, or falsely cer- tified as eligible to borrow.

Sec.

438. ø20 u.s.c.

1087–1¿ special allowances.

Sec.

439. ø20 u.s.c.

1087–2¿ student loan marketing association.

Sec.


440. reorganization of the student loan marketing association through the for- Sec.

440A.

Discrimination in secondary markets prohibited.

mation of a holding company.

PART C—FEDERAL WORK-STUDY PROGRAMS Sec.

441. ø20 u.s.c.

1087–51¿ purpose; appropriations authorized.

Sec.

442. ø20 u.s.c.

1087–52¿ allocation of funds.

Sec.

443. ø20 u.s.c.

1087–53¿ grants for Federal work-study programs.

Sec.

444. ø20 u.s.c.


1087–54 note¿ sources of matching funds.

Sec.

445. ø20 u.s.c.

1087–55¿ flexible use of funds.

Sec.

446. ø20 u.s.c.

1087–56¿ job location and development programs.

Sec.

447. ø20 u.s.c.

1087–57¿ additional funds to conduct community service work- Sec.

448. ø20 u.s.c.

1087–58¿ work colleges.

study programs.

PART D—WILLIAM D. FORD FEDERAL DIRECT LOAN PROGRAM Sec.

451. ø20 u.s.c.

1087a¿ program authority.

Sec.

452. ø20 u.s.c.


1087b¿ funds for origination of direct student loans.

Sec.

453. ø20 u.s.c.

1087c¿ selection of institutions for participation and origination.

Sec.

454. ø20 u.s.c.

1087d¿ agreements with institutions.

Sec.

455. ø20 u.s.c.

1087e¿ terms and conditions of loans.

Sec.

456. ø20 u.s.c.

1087f¿ contracts.

Sec.

458. ø20 u.s.c.

1087h¿ funds for administrative expenses.

Sec.

459. ø20 u.s.c.

1087i¿ authority to sell loans.

Sec.

459A.

ø20 u.s.c.


1087i–1¿ temporary authority to purchase student loans.

Sec.

459B.

ø20 u.s.c.

1087i–2¿ temporary loan consolidation authority.

Sec.

460. ø20 u.s.c.

1087j¿ loan cancellation for teachers.

PART E—FEDERAL PERKINS LOANS Sec.

461. ø20 u.s.c.

1087aa¿ appropriations authorized.

Sec.

462. ø20 u.s.c.

1087bb¿ allocation of funds.

Sec.

463. ø20 u.s.c.

1087cc¿ agreements with institutions of higher education.

Sec.

463A.

ø20 u.s.c.


1087cc–1¿ student loan information by eligible institutions.

Sec.

464. ø20 u.s.c.

1087dd¿ terms of loans.

Sec.

465. ø20 u.s.c.

1087ee¿ cancellation of loans for certain public service.

Sec.

466. ø20 u.s.c.

1087ff¿ distribution of assets from student loan funds.

Sec.

467. ø20 u.s.c.

1087gg¿ collection of defaulted loans: perkins loan revolving fund.

Sec.

468. ø20 u.s.c.

1087hh¿ general authority of secretary.

Sec.

469. ø20 u.s.c.

1087ii¿ definitions.


PART F—NEED ANALYSIS Sec.

471. ø20 u.s.c.

1087kk¿ amount of need.

Sec.

472. ø20 u.s.c.

1087ll¿ cost of attendance.

Sec.

473. ø20 u.s.c.

1087mm¿ family contribution.

Sec.

474. ø20 u.s.c.

1087nn¿ determination of expected family contribution; data elements.

Sec.

475. ø20 u.s.c.

1087oo¿ family contribution for dependent students.

Sec.

476. ø20 u.s.c.

1087pp¿ family contribution for independent students without dependents other than a spouse.
September 8, 2023 As Amended Through P.L.

117-286, Enacted December 27, 2022 HOLC G:\COMP\EDIII\HIGHER EDUCATION ACT OF 1965.XML 7 HIGHER EDUCATION ACT OF 1965 Sec.

477. ø20 u.s.c.

1087qq¿ family contribution for independent students with de- pendents other than a spouse.

Sec.

478. ø20 u.s.c.

1087rr¿ regulations; updated tables.

Sec.

479. ø20 u.s.c.

1087ss¿ simplified needs tests.

Sec.


479A.

ø20 u.s.c.

1087tt¿ discretion of student financial aid administrators.

Sec.

479B.

ø20 u.s.c.

1087uu¿ disregard of student aid in other Federal programs.

Sec.

479C.

ø20 u.s.c.

1087uu–1¿ native american students Sec.

480. ø20 u.s.c.

1087vv¿ definitions.

PART G—GENERAL PROVISIONS RELATING TO STUDENT ASSISTANCE PROGRAMS Sec.

481. ø20 u.s.c.

1088¿ definitions.

Sec.

481A.

ø20 u.s.c.

1088a¿ clock and credit hour treatment of diploma nursing schools.
Sec.

482. ø20 u.s.c.

1089¿ master calendar.

Sec.

483. ø20 u.s.c.

1090¿ forms and regulations.

Sec.

484. ø20 u.s.c.

1091¿ student eligibility.

Sec.

484A.

ø20 u.s.c.

1091a¿ statute of limitations, and State court judgments.

Sec.

484B.

ø20 u.s.c.

1091b¿ institutional refunds.

Sec.

484C.

ø20 u.s.c.

1091c¿ readmission requirements for servicemembers.

Sec.

485. ø20 u.s.c.

1092¿ institutional and financial assistance information for stu- dents.

Sec.

485A.

ø20 u.s.c.


1092a¿ combined payment plan.

Sec.

485B.

ø20 u.s.c.

1092b¿ national student loan data system.

Sec.

485C.

ø20 u.s.c.

1092c¿ simplification of the lending process for borrowers.

Sec.

485D.

ø20 u.s.c.

1092e¿ college access initiative.

Sec.

485E.

ø20 u.s.c.

1092f¿ early awareness of financial aid eligibility.

Sec.

486. ø20 u.s.c.

1093¿ distance education demonstration programs.

Sec.

486A.

ø20 u.s.c.

1093a¿ articulation agreements.

Sec.

487. ø20 u.s.c.


1094¿ program participation agreements.

Sec.

487A.

ø20 u.s.c.

1094a¿ regulatory relief and improvement.

Sec.

487B.

ø20 u.s.c.

1094b¿ assignment of identification numbers.

Sec.

488. ø20 u.s.c.

1095¿ transfer of allotments.

Sec.

488A.

ø20 u.s.c.

1095a¿ wage garnishment requirement.

Sec.

489. ø20 u.s.c.

1096¿ administrative expenses.

Sec.

490. ø20 u.s.c.

1097¿ criminal penalties.

Sec.

490A.

ø20 u.s.c.

1097a¿ administrative subpoenas.

Sec.

491. ø20 u.s.c.


1098¿ advisory committee on student financial assistance.

Sec.

492. ø20 u.s.c.

1098a¿ regional meetings and negotiated rulemaking.

Sec.

493. ø20 u.s.c.

1098b¿ authorization of appropriations for administrative ex- Sec.

493B.

ø20 u.s.c.

1098d¿ procedures for cancellations and deferments for eligi- penses.

ble disabled veterans.

Sec.

493C.

ø20 u.s.c.

1098e¿ income-based repayment.

Sec.

493D.

ø20 u.s.c.

1098f¿ deferral of loan repayment following active duty.
PART H—PROGRAM INTEGRITY SUBPART 1—STATE ROLE Sec.

495. ø20 u.s.c.

1099a¿ State responsibilities.

SUBPART 2—ACCREDITING AGENCY RECOGNITION Sec.

496. ø20 u.s.c.

1099b¿ recognition of accrediting agency or association.

SUBPART 3—ELIGIBILITY AND CERTIFICATION PROCEDURES Sec.

498. ø20 u.s.c.

1099c¿ eligibility and certification procedures.

Sec.

498A.

ø20 u.s.c.

1099c–1¿ program review and data.

Sec.

498B.

ø20 u.s.c.

1099c–2¿ review of regulations.


PART I—COMPETITIVE LOAN AUCTION PILOT PROGRAM Sec.

499. ø20 u.s.c.

1099d¿ competitive loan auction pilot program.

TITLE V—DEVELOPING INSTITUTIONS PART A—HISPANIC-SERVING INSTITUTIONS Sec.

501. ø20 u.s.c.

1101¿ findings; purpose; and program authority.

Sec.

502. ø20 u.s.c.

1101a¿ definitions; eligibility.

Sec.

503. ø20 u.s.c.

1101b¿ authorized activities.

September 8, 2023 As Amended Through P.L.


117-286, Enacted December 27, 2022 HOLC G:\COMP\EDIII\HIGHER EDUCATION ACT OF 1965.XML HIGHER EDUCATION ACT OF 1965 8 Sec.

504. ø20 u.s.c.

1101c¿ duration of grant.

Sec.

505. ø20 u.s.c.

1101d¿ special rule.

PART B—PROMOTING POSTBACCALAUREATE OPPORTUNITIES FOR HISPANIC AMERICANS Sec.

511. ø20 u.s.c.

1102¿ purposes.

Sec.

512. ø20 u.s.c.


1102a¿ program authority and eligibility.

Sec.

513. ø20 u.s.c.

1102b¿ authorized activities.

Sec.

514. ø20 u.s.c.

1102c¿ application and duration.

PART C—GENERAL PROVISIONS Sec.

521. ø20 u.s.c.

1103¿ eligibility; applications.

Sec.

522. ø20 u.s.c.

1103a¿ waiver authority and reporting requirement.

Sec.

523. ø20 u.s.c.

1103b¿ application review process.

Sec.

524. ø20 u.s.c.

1103c¿ cooperative arrangements.

Sec.

525. ø20 u.s.c.


1103d¿ assistance to institutions under other programs.

Sec.

526. ø20 u.s.c.

1103e¿ limitations.

Sec.

527. ø20 u.s.c.

1103f¿ penalties.

Sec.

528. ø20 u.s.c.

1103g¿ authorizations of appropriations.

TITLE VI—INTERNATIONAL EDUCATION PROGRAMS PART A—INTERNATIONAL AND FOREIGN LANGUAGE STUDIES Sec.

601. ø20 u.s.c.

1121¿ findings; purposes; consultation; survey.

Sec.

602. ø20 u.s.c.

1122¿ graduate and undergraduate language and area centers and programs.

Sec.
Sec.

603. ø20 u.s.c.

1123¿ language resource centers.

Sec.

604. ø20 u.s.c.

1124¿ undergraduate international studies and foreign lan- guage programs.

Sec.

605. ø20 u.s.c.

1125¿ research; studies; annual report.

Sec.

606. ø20 u.s.c.

1126¿ technological innovation and cooperation for foreign in- formation access.

Sec.

607. ø20 u.s.c.

1127¿ selection of certain grant recipients.

Sec.

608. ø20 u.s.c.

1128¿ equitable distribution of certain funds.

Sec.

609. ø20 u.s.c.


1128a¿ american overseas research centers.

Sec.

610. ø20 u.s.c.

1128b¿ authorization of appropriations.

PART B—BUSINESS AND INTERNATIONAL EDUCATION PROGRAMS Sec.

611. ø20 u.s.c.

1130¿ findings and purposes.

Sec.

612. ø20 u.s.c.

1130–1¿ centers for international business education.

Sec.

613. ø20 u.s.c.

1130a¿ education and training programs.

Sec.

614. ø20 u.s.c.

1130b¿ authorization of appropriations.

PART C—INSTITUTE FOR INTERNATIONAL PUBLIC POLICY Sec.
621. ø20 u.s.c.

1131¿ minority foreign service professional development pro- gram.

Sec.

622. ø20 u.s.c.

1131–1¿ institutional development.

Sec.

623. ø20 u.s.c.

1131a¿ study abroad program.

Sec.

624. ø20 u.s.c.

1131b¿ advanced degree in international relations.

Sec.

625. ø20 u.s.c.

1131c¿ internships.

Sec.

626. ø20 u.s.c.

1131c–1¿ financial assistance.

Sec.

627. ø20 u.s.c.

1131d¿ report.

Sec.

628. ø20 u.s.c.

1131e¿ gifts and donations.

Sec.

629. ø20 u.s.c.

1131f¿ authorization.


PART D—GENERAL PROVISIONS Sec.

631. ø20 u.s.c.

1132¿ definitions.

Sec.

632. ø20 u.s.c.

1132–1¿ special rule.

Sec.

633. ø20 u.s.c.

1132–2¿ rule of construction.

Sec.

634. ø20 u.s.c.

1132–3¿ assessment.

Sec.

635. ø20 u.s.c.

1132–4¿ evaluation, outreach, and information.

Sec.

636. ø20 u.s.c.

1132–5¿ report.

Sec.

637. ø20 u.s.c.

1132–6¿ science and technology advanced foreign language edu- Sec.

638. ø20 u.s.c.

1132–7¿ reporting by institutions.


cation grant program.

TITLE VII—GRADUATE AND POSTSECONDARY IMPROVEMENT PROGRAMS Sec.

700. ø20 u.s.c.

1133¿ purpose.

September 8, 2023 As Amended Through P.L.


117-286, Enacted December 27, 2022 HOLC G:\COMP\EDIII\HIGHER EDUCATION ACT OF 1965.XML 9 HIGHER EDUCATION ACT OF 1965 PART A—GRADUATE EDUCATION PROGRAMS SUBPART 1—JACOB K. JAVITS FELLOWSHIP PROGRAM Sec.

701. ø20 u.s.c.

1134¿ award of jacob k. Javits fellowships.

Sec.

702. ø20 u.s.c.

1134a¿ allocation of fellowships.

Sec.

703. ø20 u.s.c.


1134b¿ stipends.

Sec.

704. ø20 u.s.c.

1134c¿ fellowship conditions.

Sec.

705. ø20 u.s.c.

1134d¿ authorization of appropriations.

SUBPART 2—GRADUATE ASSISTANCE IN AREAS OF NATIONAL NEED Sec.

711. ø20 u.s.c.

1135¿ grants to academic departments and programs of institu- tions.

Sec.

712. ø20 u.s.c.

1135a¿ institutional eligibility.

Sec.

713. ø20 u.s.c.

1135b¿ criteria for applications.

Sec.

714. ø20 u.s.c.

1135c¿ awards to graduate students.

Sec.

715. ø20 u.s.c.


1135d¿ additional assistance for cost of education.

Sec.

716. ø20 u.s.c.

1135e¿ authorization of appropriations.

SUBPART 3—THURGOOD MARSHALL LEGAL EDUCATIONAL OPPORTUNITY PROGRAM Sec.

721. ø20 u.s.c.

1136¿ legal educational opportunity program.

SUBPART 4—MASTERS DEGREE PROGRAMS AT HISTORICALLY BLACK COL- LEGES AND UNIVERSITIES AND PREDOMINANTLY BLACK INSTITUTIONS Sec.

723. ø20 u.s.c.

1136a¿ masters degree programs at historically black colleges Sec.

724. ø20 u.s.c.
724. ø20 u.s.c.

1136b¿ masters degree programs at predominantly black insti- and universities.

Sec.

725. ø20 u.s.c.

1136c¿ authorization of appropriations.

tutions.

Sec.

731. ø20 u.s.c.

1137¿ administrative provisions for subparts 1 through 4.

SUBPART 5—GENERAL PROVISIONS PART B—FUND FOR THE IMPROVEMENT OF POSTSECONDARY EDUCATION Sec.

741. ø20 u.s.c.

1138¿ fund for the improvement of postsecondary Sec.

742. ø20 u.s.c.

1138a¿ board of the fund for the improvement of postsecondary education.
education.

Sec.

743. ø20 u.s.c.

1138b¿ administrative provisions.

Sec.

744. ø20 u.s.c.

1138c¿ special projects.

Sec.

745. ø20 u.s.c.

1138d¿ authorization of appropriations.

PART D—PROGRAMS TO PROVIDE STUDENTS WITH DISABILITIES WITH A QUALITY HIGHER EDUCATION Sec.

760. ø20 u.s.c.

1140¿ definitions.

SUBPART 1—DEMONSTRATION PROJECTS TO SUPPORT POSTSECONDARY FACULTY, STAFF, AND ADMINISTRATORS IN EDUCATING STUDENTS WITH DISABILITIES Sec.

761. ø20 u.s.c.

1140a¿ purpose.

Sec.

762. ø20 u.s.c.


1140b¿ grants, contracts, and cooperative agreements author- ized.

Sec.

763. ø20 u.s.c.

1140c¿ applications.

Sec.

764. ø20 u.s.c.

1140d¿ rule of construction.

Sec.

765. ø20 u.s.c.

1140e¿ authorization of appropriations.

SUBPART 2—TRANSITION PROGRAMS FOR STUDENTS WITH INTELLECTUAL DISABILITIES INTO HIGHER EDUCATION Sec.

766. ø20 u.s.c.

1140f¿ purpose.

Sec.

767. ø20 u.s.c.


1140g¿ model comprehensive transition and postsecondary pro- grams for students with intellectual disabilities.

Sec.

768. ø20 u.s.c.

1140h¿ rule of construction.

Sec.

769. ø20 u.s.c.

1140i¿ authorization of appropriations and reservation.

September 8, 2023 As Amended Through P.L.


117-286, Enacted December 27, 2022 HOLC G:\COMP\EDIII\HIGHER EDUCATION ACT OF 1965.XML HIGHER EDUCATION ACT OF 1965 10 SUBPART 3—COMMISSION ON ACCESSIBLE MATERIALS; PROGRAMS TO SUPPORT IMPROVED ACCESS TO MATERIALS Sec.

771. ø20 u.s.c.

1140k¿ definition of student with a print disability.

Sec.

772. ø20 u.s.c.


1140l¿ establishment of advisory commission on accessible in- structional materials in postsecondary education for students with dis- abilities.

Sec.

773. ø20 u.s.c.

1140m¿ model demonstration programs to support improved ac- cess to postsecondary instructional materials for students with print disabilities.

Sec.

774. ø20 u.s.c.

1140n¿ rule of construction.

Sec.

775. ø20 u.s.c.

1140o¿ authorization of appropriations.


SUBPART 4—NATIONAL TECHNICAL ASSISTANCE CENTER; COORDINATING CENTER Sec.

776. ø20 u.s.c.

1140p¿ purpose.

Sec.

777. ø20 u.s.c.

1140q¿ national technical assistance center; coordinating cen- Sec.

778. ø20 u.s.c.

1140r¿ authorization of appropriations.

ter.

PART E—COLLEGE ACCESS CHALLENGE GRANT PROGRAM Sec.

781. ø20 u.s.c.

1141¿ college access challenge grant program.

TITLE VIII—ADDITIONAL PROGRAMS Sec.

801. ø20 u.s.c.

1161a¿ project grad.


PART A—PROJECT GRAD PART B—MATHEMATICS AND SCIENCE SCHOLARS PROGRAM Sec.

802. ø20 u.s.c.

1161b¿ mathematics and science scholars program.

PART C—BUSINESS WORKFORCE PARTNERSHIPS FOR JOB SKILL TRAINING IN HIGH- GROWTH OCCUPATIONS OR INDUSTRIES Sec.

803. ø20 u.s.c.

1161c¿ business workforce partnerships for job skill training in high-growth occupations or industries.

PART D—CAPACITY FOR NURSING STUDENTS AND FACULTY Sec.

804. ø20 u.s.c.
804. ø20 u.s.c.

1161d¿ capacity for nursing students and faculty.

Sec.

805. ø20 u.s.c.

1161e¿ american history for freedom.

PART E—AMERICAN HISTORY FOR FREEDOM Sec.

806. ø20 u.s.c.

1161f¿ teach for america.

PART F—TEACH FOR AMERICA Sec.

807. ø20 u.s.c.

1161g¿ patsy t. Mink fellowship program.

PART G—PATSY T. MINK FELLOWSHIP PROGRAM PART H—IMPROVING COLLEGE ENROLLMENT BY SECONDARY SCHOOLS Sec.

808. ø20 u.s.c.

1161h¿ improving college enrollment by secondary schools.
PART I—EARLY CHILDHOOD EDUCATION PROFESSIONAL DEVELOPMENT AND CAREER TASK FORCE Sec.

811. ø20 u.s.c.

1161i¿ purpose.

Sec.

812. ø20 u.s.c.

1161i–1¿ definition of early childhood education program.

Sec.

813. ø20 u.s.c.

1161i–2¿ grants authorized.

Sec.

814. ø20 u.s.c.

1161i–3¿ State task force establishment.

Sec.

815. ø20 u.s.c.

1161i–4¿ State task force activities.

Sec.

816. ø20 u.s.c.

1161i–5¿ State application and report.

Sec.

817. ø20 u.s.c.

1161i–6¿ evaluations.

Sec.

818. ø20 u.s.c.


1161i–7¿ authorization of appropriations.

September 8, 2023 As Amended Through P.L.

117-286, Enacted December 27, 2022 HOLC G:\COMP\EDIII\HIGHER EDUCATION ACT OF 1965.XML 11 HIGHER EDUCATION ACT OF 1965 PART J—IMPROVING SCIENCE, TECHNOLOGY, ENGINEERING, AND MATHEMATICS EDUCATION WITH A FOCUS ON ALASKA NATIVE AND NATIVE HAWAIIAN STUDENTS Sec.
819. ø20 u.s.c.

1161j¿ improving science, technology, engineering, and mathe- matics education with a focus on alaska native and native hawaiian students.

PART K—PILOT PROGRAMS TO INCREASE COLLEGE PERSISTENCE AND SUCCESS Sec.

820. ø20 u.s.c.

1161k¿ pilot programs to increase college persistence and suc- cess.

PART L—STUDENT SAFETY AND CAMPUS EMERGENCY MANAGEMENT Sec.

821. ø20 u.s.c.

1161l¿ student safety and campus emergency management.

Sec.

822. ø20 u.s.c.


1161l–1¿ model emergency response policies, procedures, and practices.

Sec.

823. ø20 u.s.c.

1161l–2¿ preparation for future disasters plan by the secretary.

Sec.

824. ø20 u.s.c.

1161l–3¿ education disaster and emergency relief loan program.

Sec.

825. ø20 u.s.c.

1161l–4¿ guidance on mental health disclosures for student Sec.

826. ø20 u.s.c.

1161l–5¿ rule of construction.

safety.

Sec.

830. ø20 u.s.c.

1161m¿ incentives and rewards for low tuition.


PART M—LOW TUITION PART N—COOPERATIVE EDUCATION Sec.

831. ø20 u.s.c.

1161n¿ Statement of purpose; definition.

Sec.

832. ø20 u.s.c.

1161n–1¿ reservations.

Sec.

833. ø20 u.s.c.

1161n–2¿ grants for cooperative education.

Sec.

834. ø20 u.s.c.

1161n–3¿ demonstration and innovation projects; training and Sec.

835. ø20 u.s.c.

1161n–4¿ authorization of appropriations.

resource centers; and research.

Sec.

841. ø20 u.s.c.


1161o¿ college partnership grants authorized.

PART O—COLLEGE PARTNERSHIP GRANTS Sec.

851. ø20 u.s.c.

1161p¿ grants to create bridges from jobs to careers.

PART P—JOBS TO CAREERS PART Q—RURAL DEVELOPMENT GRANTS FOR RURAL-SERVING COLLEGES AND UNIVERSITIES Sec.

861. ø20 u.s.c.

1161q¿ grants to rural-serving institutions of higher education.

PART R—CAMPUS-BASED DIGITAL THEFT PREVENTION Sec.

871. ø20 u.s.c.

1161r¿ campus-based digital theft prevention.


PART S—TRAINING FOR REALTIME WRITERS Sec.

872. ø20 u.s.c.

1161s¿ program to promote training and job placement of realtime writers.

PART T—CENTERS OF EXCELLENCE FOR VETERAN STUDENT SUCCESS Sec.

873. ø20 u.s.c.

1161t¿ model programs for centers of excellence for veteran stu- dent success.

Sec.

881. ø20 u.s.c.

1161u¿ sustainability planning grants authorized.

PART U—UNIVERSITY SUSTAINABILITY PROGRAMS Sec.

891. ø20 u.s.c.

1161v¿ modeling and simulation.


PART V—MODELING AND SIMULATION PROGRAMS Sec.

892. ø20 u.s.c.

1161w¿ path to success.

PART W—PATH TO SUCCESS PART X—SCHOOL OF VETERINARY MEDICINE COMPETITIVE GRANT PROGRAM Sec.

893. ø20 u.s.c.

1161x¿ school of veterinary medicine competitive grant pro- gram.

September 8, 2023 As Amended Through P.L.


117-286, Enacted December 27, 2022 HOLC G:\COMP\EDIII\HIGHER EDUCATION ACT OF 1965.XML Sec.

101 HIGHER EDUCATION ACT OF 1965 12 PART Y—EARLY FEDERAL PELL GRANT COMMITMENT DEMONSTRATION PROGRAM Sec.

894. ø20 u.s.c.

1161y¿ early Federal pell grant commitment demonstration pro- gram.

PART Z—HENRY KUUALOHA GIUGNI KUPUNA MEMORIAL ARCHIVES Sec.
895. ø20 u.s.c.

1161z¿ henry kuualoha giugni kupuna memorial archives.

PART AA—MASTERS AND POSTBACCALAUREATE PROGRAMS Sec.

897. ø20 u.s.c.

1161aa¿ masters degree programs.

Sec.

898. ø20 u.S.C.

1161aa–1¿ POSTBACCALAUREATE PROGRAMS.

TITLE I—GENERAL PROVISIONS PART A—DEFINITIONS SEC.

101. ø20 U.S.C.

1001¿ GENERAL DEFINITION OF INSTITUTION OF HIGHER EDUCATION.
(a) INSTITUTION OF HIGHER EDUCATION.—For purposes of this Act, other than title IV, the term ‘‘institution of higher education’’ means an educational institution in any State that— (1) admits as regular students only persons having a cer- tificate of graduation from a school providing secondary edu- cation, or the recognized equivalent of such a certificate, or persons who meet the requirements of section 484(d); (2) is legally authorized within such State to provide a pro- gram of education beyond secondary education; (3) provides an educational program for which the institu- tion awards a bachelor’s degree or provides not less than a 2- year program that is acceptable for full credit toward such a degree, or awards a degree that is acceptable for admission to a graduate or professional degree program, subject to review and approval by the Secretary; (4) is a public or other nonprofit institution; and (5) is accredited by a nationally recognized accrediting agency or association, or if not so accredited, is an institution that has been granted preaccreditation status by such an agen- cy or association that has been recognized by the Secretary for the granting of preaccreditation status, and the Secretary has determined that there is satisfactory assurance that the insti- tution will meet the accreditation standards of such an agency or association within a reasonable time.
(b) ADDITIONAL INSTITUTIONS INCLUDED.—For purposes of this Act, other than title IV, the term ‘‘institution of higher education’’ also includes— (1) any school that provides not less than a 1-year program of training to prepare students for gainful employment in a recognized occupation and that meets the provision of para- graphs (1), (2), (4), and (5) of subsection (a); and (2) a public or nonprofit private educational institution in any State that, in lieu of the requirement in subsection (a)(1), admits as regular students individuals— (A) who are beyond the age of compulsory school at- tendance in the State in which the institution is located; or September 8, 2023 As Amended Through P.L.
117-286, Enacted December 27, 2022 HOLC G:\COMP\EDIII\HIGHER EDUCATION ACT OF 1965.XML 13 HIGHER EDUCATION ACT OF 1965 Sec.

102 (B) who will be dually or concurrently enrolled in the institution and a secondary school.
(c) LIST OF ACCREDITING AGENCIES.—For purposes of this sec- tion and section 102, the Secretary shall publish a list of nationally recognized accrediting agencies or associations that the Secretary determines, pursuant to subpart 2 of part H of title IV, to be reli- able authority as to the quality of the education or training offered.

SEC.

102. ø20 U.S.C.

1002¿ DEFINITION OF INSTITUTION OF HIGHER EDUCATION FOR PURPOSES OF TITLE IV PROGRAMS.
(a) DEFINITION OF INSTITUTION OF HIGHER EDUCATION FOR PURPOSES OF TITLE IV PROGRAMS.— (1) INCLUSION OF ADDITIONAL INSTITUTIONS.—Subject to paragraphs (2) through (4) of this subsection, the term ‘‘institu- tion of higher education’’ for purposes of title IV includes, in addition to the institutions covered by the definition in section 101— (A) a proprietary institution of higher education (as defined in subsection (b) of this section); (B) a postsecondary vocational institution (as defined in subsection (c) of this section); and (C) only for the purposes of part D of title IV, an insti- tution outside the United States that is comparable to an institution of higher education as defined in section 101 and that has been approved by the Secretary for the pur- pose of part D of title IV, consistent with the requirements of section 452(d).
(2) INSTITUTIONS OUTSIDE THE UNITED STATES.— (A) IN GENERAL.—For the purpose of qualifying as an institution under paragraph (1)(C), the Secretary shall es- tablish criteria by regulation for the approval of institu- tions outside the United States and for the determination that such institutions are comparable to an institution of higher education as defined in section 101 (except that a graduate medical school, nursing school, or a veterinary school, located outside the United States shall not be re- quired to meet the requirements of section 101(a)(4)).
Such criteria shall include a requirement that a student attend- ing such school outside the United States is ineligible for loans made under part D of title IV unless— (i) except as provided in subparagraph (B)(iii)(IV), in the case of a graduate medical school located out- side the United States— (I)(aa) at least 60 percent of those enrolled in, and at least 60 percent of the graduates of, the graduate medical school outside the United States were not persons described in section 484(a)(5) in the year preceding the year for which a student is seeking a loan under part D of title IV; and (bb) at least 75 percent of the individuals who were students or graduates of the graduate med- ical school outside the United States or Canada (both nationals of the United States and others) taking the examinations administered by the Edu- cational Commission for Foreign Medical Grad- September 8, 2023 As Amended Through P.L.
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102 HIGHER EDUCATION ACT OF 1965 14 uates received a passing score in the year pre- ceding the year for which a student is seeking a loan under part D of title IV; or (II) the institution— (aa) has or had a clinical training pro- gram that was approved by a State as of Jan- uary 1, 1992; and (bb) continues to operate a clinical train- ing program in at least one State that is ap- proved by that State; (ii) in the case of a veterinary school located out- side the United States that does not meet the require- ments of section 101(a)(4), the institution’s students complete their clinical training at an approved veteri- nary school located in the United States; or (iii) in the case of a nursing school located outside of the United States— (I) the nursing school has an agreement with a hospital, or accredited school of nursing (as such terms are defined in section 801 of the Public Health Service Act (42 U.S.C.
296)), located in the United States that requires the students of the nursing school to complete the students’ clinical training at such hospital or accredited school of nursing; (II) the nursing school has an agreement with an accredited school of nursing located in the United States providing that the students grad- uating from the nursing school located outside of the United States also receive a degree from the accredited school of nursing located in the United States; (III) the nursing school certifies only Federal Direct Stafford Loans under section 455(a)(2)(A), Federal Direct Unsubsidized Stafford Loans under section 455(a)(2)(D), or Federal Direct PLUS Loans under section 455(a)(2)(B) for students at- tending the institution; (IV) the nursing school reimburses the Sec- retary for the cost of any loan defaults for current and former students included in the calculation of the institution’s cohort default rate during the previous fiscal year; and (V) not less than 75 percent of the individuals who were students or graduates of the nursing school, and who took the National Council Licen- sure Examination for Registered Nurses in the year preceding the year for which the institution is certifying a Federal Direct Stafford Loan under section 455(a)(2)(A), a Federal Direct Unsub- sidized Stafford Loan under section 455(a)(2)(D), or a Federal Direct PLUS Loan under section 455(a)(2)(B), received a passing score on such ex- amination.
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102 (B) ADVISORY PANEL.— (i) IN GENERAL.—For the purpose of qualifying as an institution under paragraph (1)(C) of this sub- section, the Secretary shall establish an advisory panel of medical experts that shall— (I) evaluate the standards of accreditation ap- plied to applicant foreign medical schools; and (II) determine the comparability of those standards to standards for accreditation applied to United States medical schools.
(ii) SPECIAL RULE.—If the accreditation standards described in clause (i) are determined not to be com- parable, the foreign medical school shall be required to meet the requirements of section 101.
(iii) REPORT.— (I) IN GENERAL.—Not later than 1 year after the date of enactment of the Higher Education Opportunity Act, the advisory panel described in clause (i) shall submit a report to the Secretary and to the authorizing committees recommending eligibility criteria for participation in the loan pro- grams under part D of title IV for graduate med- ical schools that— (aa) are located outside of the United States; (bb) do not meet the requirements of sub- paragraph (A)(i); and (cc) have a clinical training program ap- proved by a State prior to January 1, 2008.
(II) RECOMMENDATIONS.—In the report de- scribed in subclause (I), the advisory panel’s eligi- bility criteria shall include recommendations re- garding the appropriate levels of performance for graduate medical schools described in such sub- clause in the following areas: (aa) Entrance requirements.

(bb) Retention and graduation rates.

(cc) Successful placement of students in United States medical residency programs.

(dd) Passage rate of students on the United States Medical Licensing Examina- tion.
(ee) The extent to which State medical boards have assessed the quality of such school’s program of including through on-site reviews.

instruction, (ff) The extent to which graduates of such schools would be unable to practice medicine in 1 or more States, based on the judgment of a State medical board.

(gg) Any areas recommended by the Comptroller General of the United States under section 1101 of the Higher Education Opportunity Act.

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102 HIGHER EDUCATION ACT OF 1965 16 (hh) Any additional areas the Secretary criteria described may require.
(III) MINIMUM ELIGIBILITY REQUIREMENT.—In the recommendations described in subclause (II), the subparagraph (A)(i)(I)(bb), as amended by section 102(b) of the Higher Education Opportunity Act, shall be a minimum eligibility requirement for a graduate medical school described in subclause (I) to par- ticipate in the loan programs under part D of title IV.
in (IV) AUTHORITY.—The Secretary may— (aa) not earlier than 180 days after the submission of the report described in sub- clause (I), issue proposed regulations estab- lishing criteria for the eligibility of graduate medical schools described in such subclause to participate in the loan programs under part D of title IV based on the recommendations of such report; and (bb) not earlier than one year after the issuance of proposed regulations under item (aa), issue final regulations establishing such criteria for eligibility.
(C) FAILURE TO RELEASE INFORMATION.—The failure of an institution outside the United States to provide, re- lease, or authorize release to the Secretary of such infor- mation as may be required by subparagraph (A) shall render such institution ineligible for the purpose of part D of title IV.
(D) SPECIAL RULE.—If, pursuant to this paragraph, an institution loses eligibility to participate in the programs under title IV, then a student enrolled at such institution may, notwithstanding such loss of eligibility, continue to be eligible to receive a loan under part D of title IV while attending such institution for the academic year suc- ceeding the academic year in which such loss of eligibility occurred.
(3) LIMITATIONS BASED ON COURSE OF STUDY OR ENROLL- MENT.—An institution shall not be considered to meet the defi- nition of an institution of higher education in paragraph (1) if such institution— (A) offers more than 50 percent of such institution’s courses by correspondence (excluding courses offered by telecommunications as defined in section 484(l)(4)), unless the institution is an institution that meets the definition in section 3(3)(C) of the Carl D. Perkins Career and Tech- nical Education Act of 2006; (B) enrolls 50 percent or more of the institution’s stu- dents in correspondence courses (excluding courses offered by telecommunications as defined in section 484(l)(4)), un- less the institution is an institution that meets the defini- tion in such section, except that the Secretary, at the re- quest of such institution, may waive the applicability of September 8, 2023 As Amended Through P.L.
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102 this subparagraph to such institution for good cause, as determined by the Secretary in the case of an institution of higher education that provides a 2- or 4-year program of instruction (or both) for which the institution awards an associate or baccalaureate degree, respectively; (C) has a student enrollment in which more than 25 percent of the students are incarcerated, except that the Secretary may waive the limitation contained in this sub- paragraph for a nonprofit institution that provides a 2- or 4-year program of instruction (or both) for which the insti- tution awards a bachelor’s degree, or an associate’s degree or a postsecondary diploma, respectively; or (D) has a student enrollment in which more than 50 percent of the students do not have a secondary school di- ploma or its recognized equivalent, and does not provide a 2- or 4-year program of instruction (or both) for which the institution awards a bachelor’s degree or an associate’s de- gree, respectively, except that the Secretary may waive the limitation contained in this subparagraph if a nonprofit in- stitution demonstrates to the satisfaction of the Secretary that the institution exceeds such limitation because the in- stitution serves, through contracts with Federal, State, or local government agencies, significant numbers of students who do not have a secondary school diploma or its recog- nized equivalent.
(4) LIMITATIONS BASED ON MANAGEMENT.—An institution shall not be considered to meet the definition of an institution of higher education in paragraph (1) if— (A) the institution, or an affiliate of the institution that has the power, by contract or ownership interest, to direct or cause the direction of the management or policies of the institution, has filed for bankruptcy, except that this paragraph shall not apply to a nonprofit institution, the primary function of which is to provide health care edu- cational services (or an affiliate of such an institution that has the power, by contract or ownership interest, to direct or cause the direction of the institution’s management or policies) that files for bankruptcy under chapter 11 of title 11, United States Code, between July 1, 1998, and Decem- ber 1, 1998; or (B) the institution, the institution’s owner, or the insti- tution’s chief executive officer has been convicted of, or has pled nolo contendere or guilty to, a crime involving the ac- quisition, use, or expenditure of funds under title IV, or has been judicially determined to have committed fraud in- volving funds under title IV.
(5) CERTIFICATION.—The Secretary shall certify an institu- tion’s qualification as an institution of higher education in ac- cordance with the requirements of subpart 3 of part H of title IV.

(6) LOSS OF ELIGIBILITY.—An institution of higher edu- cation shall not be considered to meet the definition of an insti- tution of higher education in paragraph (1) if such institution September 8, 2023 As Amended Through P.L.
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103 HIGHER EDUCATION ACT OF 1965 18 is removed from eligibility for funds under title IV as a result of an action pursuant to part H of title IV.
(b) PROPRIETARY INSTITUTION OF HIGHER EDUCATION.— (1) PRINCIPAL CRITERIA.—For the purpose of this section, the term ‘‘proprietary institution of higher education’’ means a school that— (A)(i) provides an eligible program of training to pre- pare students for gainful employment in a recognized occu- pation; or (ii)(I) provides a program leading to a baccalaureate degree in liberal arts, and has provided such a program since January 1, 2009; and (II) is accredited by a recognized regional accrediting agency or association, and has continuously held such ac- creditation since October 1, 2007, or earlier; (B) meets the requirements of paragraphs (1) and (2) of section 101(a); (C) does not meet the requirement of paragraph (4) of section 101(a); (D) is accredited by a nationally recognized accrediting agency or association recognized by the Secretary pursuant to part H of title IV; and (E) has been in existence for at least 2 years.
(2) ADDITIONAL INSTITUTIONS.—The term ‘‘proprietary in- stitution of higher education’’ also includes a proprietary edu- cational institution in any State that, in lieu of the require- ment in section 101(a)(1), admits as regular students individ- uals— (A) who are beyond the age of compulsory school at- tendance in the State in which the institution is located; or (B) who will be dually or concurrently enrolled in the institution and a secondary school.
(c) POSTSECONDARY VOCATIONAL INSTITUTION.— (1) PRINCIPAL CRITERIA.—For the purpose of this section, the term ‘‘postsecondary vocational institution’’ means a school that— (A) provides an eligible program of training to prepare students for gainful employment in a recognized occupa- tion; (B) meets the requirements of paragraphs (1), (2), (4), and (5) of section 101(a); and (C) has been in existence for at least 2 years.
(2) ADDITIONAL INSTITUTIONS.—The term ‘‘postsecondary vocational institution’’ also includes an educational institution in any State that, in lieu of the requirement in section 101(a)(1), admits as regular students individuals— (A) who are beyond the age of compulsory school at- tendance in the State in which the institution is located; or (B) who will be dually or concurrently enrolled in the institution and a secondary school.

SEC.

103. ø20 U.S.C.

1003¿ ADDITIONAL DEFINITIONS.


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103 (1) AUTHORIZING COMMITTEES.—The term ‘‘authorizing committees’’ means the Committee on Health, Education, Labor, and Pensions of the Senate and the Committee on Edu- cation and Labor of the House of Representatives.
(2) COMBINATION OF INSTITUTIONS OF HIGHER EDU- CATION.—The term ‘‘combination of institutions of higher edu- cation’’ means a group of institutions of higher education that have entered into a cooperative arrangement for the purpose of carrying out a common objective, or a public or private non- profit agency, organization, or institution designated or created by a group of institutions of higher education for the purpose of carrying out a common objective on the group’s behalf.
(3) CRITICAL FOREIGN LANGUAGE.—Except as otherwise provided, the term ‘‘critical foreign language’’ means each of the languages contained in the list of critical languages des- ignated by the Secretary in the Federal Register on August 2, 1985 (50 Fed.

Reg.
31412; promulgated under the authority of section 212(d) of the Education for Economic Security Act (re- pealed by section 2303 of the Augustus F. Hawkins-Robert T. Stafford Elementary and Secondary School Improvement Amendments of 1988)), as updated by the Secretary from time to time and published in the Federal Register, except that in the implementation of this definition with respect to a specific title, the Secretary may set priorities according to the purposes of such title and the national security, economic competitive- ness, and educational needs of the United States.
(4) DEPARTMENT.—The term ‘‘Department’’ means the De- partment of Education.
(5) DIPLOMA MILL.—The term ‘‘diploma mill’’ means an en- tity that— (A)(i) offers, for a fee, degrees, diplomas, or certifi- cates, that may be used to represent to the general public that the individual possessing such a degree, diploma, or certificate has completed a program of postsecondary edu- cation or training; and (ii) requires such individual to complete little or no education or coursework to obtain such degree, diploma, or certificate; and (B) lacks accreditation by an accrediting agency or as- sociation that is recognized as an accrediting agency or as- sociation of institutions of higher education (as such term is defined in section 102) by— (i) the Secretary pursuant to subpart 2 of part H of title IV; or (ii) a Federal agency, State government, or other organization or association that recognizes accrediting agencies or associations.
(6) DISABILITY.—The term ‘‘disability’’ has the same mean- ing given that term under section 3(2) of the Americans With Disabilities Act of 1990.

(7) DISTANCE EDUCATION.— (A) IN GENERAL.—Except as otherwise provided, the term‘‘distance education’’means education that uses one or more of the technologies described in subparagraph (B)— September 8, 2023 As Amended Through P.L.
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103 HIGHER EDUCATION ACT OF 1965 20 (i) to deliver instruction to students who are sepa- rated from the instructor; and (ii) to support regular and substantive interaction instructor, syn- the students and between chronously or asynchronously.
(B) INCLUSIONS.—For the purposes of subparagraph the (A), the technologies used may include— (i) the Internet; (ii) one-way and two-way transmissions through open broadcast, closed circuit, cable, microwave, broadband lines, fiber optics, satellite, or wireless com- munications devices; (iii) audio conferencing; or (iv) video cassettes, DVDs, and CD–ROMs, if the cassettes, DVDs, or CD–ROMs are used in a course in conjunction with any of the technologies listed in clauses (i) through (iii).
(8) EARLY CHILDHOOD EDUCATION PROGRAM.—The term ‘‘early childhood education program’’ means— (A) a Head Start program or an Early Head Start pro- gram carried out under the Head Start Act (42 U.S.C.

9831 et seq.
), including a migrant or seasonal Head Start program, an Indian Head Start program, or a Head Start program or an Early Head Start program that also re- ceives State funding; (B) a State licensed or regulated child care program; or (C) a program that— (i) serves children from birth through age six that addresses the children’s cognitive (including language, early literacy, and early mathematics), social, emo- tional, and physical development; and (ii) is— (I) a State prekindergarten program; (II) a program authorized under section 619 or part C of the Individuals with Disabilities Edu- cation Act; or (III) a program operated by a local edu- cational agency.
(9) ELEMENTARY SCHOOL.—The term ‘‘elementary school’’ has the same meaning given that term under section 8101 of the Elementary and Secondary Education Act of 1965.

(10) GIFTED AND TALENTED.—The term ‘‘gifted and tal- ented’’ has the same meaning given that term under section 8101 of the Elementary and Secondary Education Act of 1965.
(11) LOCAL EDUCATIONAL AGENCY.—The term ‘‘local edu- cational agency’’ has the same meaning given that term under section 8101 of the Elementary and Secondary Education Act of 1965.

(12) NEW BORROWER.—The term ‘‘new borrower’’ when used with respect to any date means an individual who on that date has no outstanding balance of principal or interest owing on any loan made, insured, or guaranteed under title IV.

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103 (13) NONPROFIT.—The term ‘‘nonprofit’’ as applied to a school, agency, organization, or institution means a school, agency, organization, or institution owned and operated by one or more nonprofit corporations or associations, no part of the net earnings of which inures, or may lawfully inure, to the benefit of any private shareholder or individual.

(14) POVERTY LINE.—The term ‘‘poverty line’’ means the poverty line (as defined in section 673(2) of the Community Services Block Grant Act (42 U.S.C.
9902(2)) applicable to a family of the size involved.
(15) SCHOOL OR DEPARTMENT OF DIVINITY.—The term ‘‘school or department of divinity’’ means an institution, or a department or a branch of an institution, the program of in- struction of which is designed for the education of students— (A) to prepare the students to become ministers of reli- gion or to enter upon some other religious vocation (or to provide continuing training for any such vocation); or (B) to prepare the students to teach theological sub- jects.
(16) SECONDARY SCHOOL.—The term ‘‘secondary school’’ has the same meaning given that term under section 8101 of the Elementary and Secondary Education Act of 1965.

(17) SECRETARY.—The term ‘‘Secretary’’ means the Sec- retary of Education.

(18) SERVICE-LEARNING.—The term ‘‘service-learning’’ has the same meaning given that term under section 101(23) of the National and Community Service Act of 1990.
(19) SPECIAL EDUCATION TEACHER.—The term ‘‘special edu- cation teacher’’ means teachers who teach children with dis- abilities as defined in section 602 of the Individuals with Dis- abilities Education Act.
(20) 2 STATE; FREELY ASSOCIATED STATES.— (A) STATE.—The term ‘‘State’’ includes, in addition to the several States of the United States, the Common- wealth of Puerto Rico, the District of Columbia, Guam, American Samoa, the United States Virgin Islands, the Commonwealth of the Northern Mariana Islands, and the Freely Associated States.
(B) FREELY ASSOCIATED STATES.—The term ‘‘Freely As- sociated States’’ means the Republic of the Marshall Is- lands, the Federated States of Micronesia, and the Repub- lic of Palau.

(21) STATE EDUCATIONAL AGENCY.—The term ‘‘State edu- cational agency’’ has the same meaning given that term under section 8101 of the Elementary and Secondary Education Act of 1965.

2 The placement of paragraph (20) does not necessarily reflect the placement of such para- graph in alphabetical order.
Section 103(a)(2) of PL 110–315 provides as follows: (2) REDESIGNATION AND REORDERING OF DEFINITIONS.—Section 103 (as amended by para- graph (1)) (20 U.S.C.

1003) is further amended by reordering paragraphs (1) through (16) and the paragraphs added by paragraph (1) of this subsection in alphabetical order based on the headings of such paragraphs, and renumbering such paragraphs as so reordered.
The amendment was carried out by sorting such term as if the first word ‘‘State’’ was the only word that appears in the heading.

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111 HIGHER EDUCATION ACT OF 1965 22 (22) STATE HIGHER EDUCATION AGENCY.—The term ‘‘State higher education agency’’ means the officer or agency primarily responsible for the State supervision of higher education.

(23) UNIVERSAL DESIGN.—The term‘‘universal design’’has the meaning given the term in section 3 of the Assistive Tech- nology Act of 1998 (29 U.S.C.

3002).
(24) UNIVERSAL DESIGN FOR LEARNING.—The term ‘‘uni- versal design for learning’’ means a scientifically valid frame- work for guiding educational practice that— (A) provides flexibility in the ways information is pre- sented, in the ways students respond or demonstrate knowledge and skills, and in the ways students are en- gaged; and (B) reduces barriers in instruction, provides appro- priate accommodations, supports, and challenges, and maintains high achievement expectations for all students, including students with disabilities and students who are limited English proficient.
PART B—ADDITIONAL GENERAL PROVISIONS SEC.

111. ø20 U.S.C.

1011¿ ANTIDISCRIMINATION.
(a) IN GENERAL.—Institutions of higher education receiving Federal financial assistance may not use such financial assistance, directly or indirectly, to undertake any study or project or fulfill the terms of any contract containing an express or implied provi- sion that any person or persons of a particular race, religion, sex, or national origin be barred from performing such study, project, or contract, except that nothing in this subsection shall be con- strued to prohibit an institution from conducting objective studies or projects concerning the nature, effects, or prevention of discrimi- nation, or to have the institution’s curriculum restricted on the subject of discrimination.
(b) LIMITATIONS ON STATUTORY CONSTRUCTION.—Nothing in this Act shall be construed to limit the rights or responsibilities of any individual under the Americans with Disabilities Act of 1990, the Rehabilitation Act of 1973, or any other law.

SEC.

112. ø20 U.S.C.

1011a¿ PROTECTION OF STUDENT SPEECH AND AS- SOCIATION RIGHTS.
(a) PROTECTION OF RIGHTS.—(1) It is the sense of Congress that no student attending an institution of higher education on a full- or part-time basis should, on the basis of participation in pro- tected speech or protected association, be excluded from participa- tion in, be denied the benefits of, or be subjected to discrimination or official sanction under any education program, activity, or divi- sion of the institution directly or indirectly receiving financial as- sistance under this Act, whether or not such program, activity, or division is sponsored or officially sanctioned by the institution.
(2) It is the sense of Congress that— (A) the diversity of institutions and educational missions is one of the key strengths of American higher education; September 8, 2023 As Amended Through P.L.

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113 (B) individual institutions of higher education have dif- ferent missions and each institution should design its academic program in accordance with its educational goals; (C) an institution of higher education should facilitate the free and open exchange of ideas; (D) students should not be intimidated, harassed, discour- aged from speaking out, or discriminated against; (E) students should be treated equally and fairly; and (F) nothing in this paragraph shall be construed to modify, change, or infringe upon any constitutionally protected reli- gious liberty, freedom, expression, or association.
(b) CONSTRUCTION.—Nothing in this section shall be con- strued— (1) to discourage the imposition of an official sanction on a student that has willfully participated in the disruption or attempted disruption of a lecture, class, speech, presentation, or performance made or scheduled to be made under the aus- pices of the institution of higher education, provided that the imposition of such sanction is done objectively and fairly; or (2) to prevent an institution of higher education from tak- ing appropriate and effective action to prevent violations of State liquor laws, to discourage binge drinking and other alco- hol abuse, to protect students from sexual harassment includ- ing assault and date rape, to prevent hazing, or to regulate un- sanitary or unsafe conditions in any student residence.
(c) DEFINITIONS.—For the purposes of this section: (1) OFFICIAL SANCTION.—The term ‘‘official sanction’’— (A) means expulsion, suspension, probation, censure, condemnation, reprimand, or any other disciplinary, coer- cive, or adverse action taken by an institution of higher education or administrative unit of the institution; and (B) includes an oral or written warning made by an of- ficial of an institution of higher education acting in the of- ficial capacity of the official.
(2) PROTECTED ASSOCIATION.—The term ‘‘protected associa- tion’’ means the joining, assembling, and residing with others that is protected under the first and 14th amendments to the Constitution, or would be protected if the institution of higher education involved were subject to those amendments.
(3) PROTECTED SPEECH.—The term ‘‘protected speech’’ means speech that is protected under the first and 14th amendments to the Constitution, or would be protected if the institution of higher education involved were subject to those amendments.

SEC.

113. ø20 U.S.C.

1011b¿ TERRITORIAL WAIVER AUTHORITY.


The Secretary is required to waive the eligibility criteria of any postsecondary education program administered by the Department where such criteria do not take into account the unique cir- cumstances in Guam, the United States Virgin Islands, American Samoa, the Commonwealth of the Northern Mariana Islands, and the Freely Associated States.

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114 HIGHER EDUCATION ACT OF 1965 24 SEC.

114. ø20 U.S.C.

1011c¿ NATIONAL ADVISORY COMMITTEE ON INSTI- TUTIONAL QUALITY AND INTEGRITY.
(a) ESTABLISHMENT.—There is established in the Department a National Advisory Committee on Institutional Quality and Integ- rity (in this section referred to as the ‘‘Committee’’) to assess the process of accreditation and the institutional eligibility and certifi- cation of institutions of higher education (as defined in section 102) under title IV.
(b) MEMBERSHIP.— (1) IN GENERAL.—The Committee shall have 18 members, of which— (A) six members shall be appointed by the Secretary; (B) six members shall be appointed by the Speaker of the House of Representatives, three of whom shall be ap- pointed on the recommendation of the majority leader of the House of Representatives, and three of whom shall be appointed on the recommendation of the minority leader of the House of Representatives; and (C) six members shall be appointed by the President pro tempore of the Senate, three of whom shall be ap- pointed on the recommendation of the majority leader of the Senate, and three of whom shall be appointed on the recommendation of the minority leader of the Senate.
(2) QUALIFICATIONS.—Individuals shall be appointed as members of the Committee— (A) on the basis of the individuals’ experience, integ- rity, impartiality, and good judgment; (B) from among individuals who are representatives of, or knowledgeable concerning, education and training beyond secondary education, representing all sectors and types of institutions of higher education (as defined in sec- tion 102); and (C) on the basis of the individuals’ technical qualifica- tions, professional standing, and demonstrated knowledge in the fields of accreditation and administration in higher education.
(3) TERMS OF MEMBERS.—Except as provided in paragraph (5), the term of office of each member of the Committee shall be for six years, except that any member appointed to fill a va- cancy occurring prior to the expiration of the term for which the member’s predecessor was appointed shall be appointed for the remainder of such term.

(4) VACANCY.—A vacancy on the Committee shall be filled in the same manner as the original appointment was made not later than 90 days after the vacancy occurs.
If a vacancy occurs in a position to be filled by the Secretary, the Secretary shall publish a Federal Register notice soliciting nominations for the position not later than 30 days after being notified of the va- cancy.

(5) INITIAL TERMS.—The terms of office for the initial mem- bers of the Committee shall be— (A) three years for members appointed under para- graph (1)(A); September 8, 2023 As Amended Through P.L.
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114 (B) four years for members appointed under paragraph (1)(B); and (C) six years for members appointed under paragraph (1)(C).

(6) CHAIRPERSON.—The members of the Committee shall select a chairperson from among the members.
(c) FUNCTIONS.—The Committee shall— (1) advise the Secretary with respect to establishment and enforcement of the standards of accrediting agencies or associa- tions under subpart 2 of part H of title IV; (2) advise the Secretary with respect to the recognition of a specific accrediting agency or association; (3) advise the Secretary with respect to the preparation and publication of the list of nationally recognized accrediting agencies and associations; (4) advise the Secretary with respect to the eligibility and certification process for institutions of higher education under title IV, together with recommendations for improvements in such process; (5) advise the Secretary with respect to the relationship between— (A) accreditation of institutions of higher education and the certification and eligibility of such institutions; and (B) State licensing responsibilities with respect to such institutions; and (6) carry out such other advisory functions relating to ac- creditation and institutional eligibility as the Secretary may prescribe by regulation.
(d) MEETING PROCEDURES.— (1) SCHEDULE.— (A) BIANNUAL MEETINGS.—The Committee shall meet not less often than twice each year, at the call of the Chairperson.

(B) PUBLICATION OF DATE.—The Committee shall sub- mit the date and location of each meeting in advance to the Secretary, and the Secretary shall publish such infor- mation in the Federal Register not later than 30 days be- fore the meeting.
(2) AGENDA.— (A) ESTABLISHMENT.—The agenda for a meeting of the Committee shall be established by the Chairperson and shall be submitted to the members of the Committee upon notification of the meeting.

(B) OPPORTUNITY FOR PUBLIC COMMENT.—The agenda shall include, at a minimum, opportunity for public com- ment during the Committee’s deliberations.
(3) SECRETARY’S DESIGNEE.—The Secretary shall designate an employee of the Department to serve as the Secretary’s des- ignee to the Committee, and the Chairperson shall invite the Secretary’s designee to attend all meetings of the Committee.

(4) CHAPTER 10 OF TITLE 5, UNITED STATES CODE.—Chapter 10 of title 5, United States Code, shall apply to the Committee, September 8, 2023 As Amended Through P.L.
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115 HIGHER EDUCATION ACT OF 1965 26 except that section 1013 of title 5, United States Code, shall not apply.
(e) REPORT AND NOTICE.— (1) NOTICE.—The Secretary shall annually publish in the (A) a list containing, for each member of the Com- Federal Register— mittee— (i) the member’s name; (ii) the date of the expiration of the member’s term of office; and (iii) the name of the individual described in sub- section (b)(1) who appointed the member; and (B) a solicitation of nominations for each expiring term of office on the Committee of a member appointed by the Secretary.
(2) REPORT.—Not later than the last day of each fiscal year, the Committee shall make available an annual report to the Secretary, the authorizing committees, and the public.
The annual report shall contain— (A) a detailed summary of the agenda and activities of, and the findings and recommendations made by, the Com- mittee during the fiscal year preceding the fiscal year in which the report is made; (B) a list of the date and location of each meeting dur- ing the fiscal year preceding the fiscal year in which the report is made; (C) a list of the members of the Committee; and (D) a list of the functions of the Committee, including any additional functions established by the Secretary through regulation.
(f) TERMINATION.—The Committee shall terminate on Sep- tember 30, 2021.

SEC.

115. ø20 U.S.C.

1011d¿ STUDENT REPRESENTATION.

The Secretary shall, in appointing individuals to any commis- sion, committee, board, panel, or other body in connection with the administration of this Act, include individuals who are, at the time of appointment, attending an institution of higher education.

SEC.

116. ø20 U.S.C.

1011e¿ FINANCIAL RESPONSIBILITY OF FOREIGN STUDENTS.
Nothing in this Act or any other Federal law shall be con- strued to prohibit any institution of higher education from requir- ing a student who is a foreign national (and not admitted to perma- nent residence in the United States) to guarantee the future pay- ment of tuition and fees to such institution by— (1) making advance payment of such tuition and fees; (2) making deposits in an escrow account administered by such institution for such payments; or (3) obtaining a bond or other insurance that such pay- ments will be made.
SEC.

117. ø20 U.S.C.

1011f¿ DISCLOSURES OF FOREIGN GIFTS.

(a) DISCLOSURE REPORT.—Whenever any institution is owned or controlled by a foreign source or receives a gift from or enters into a contract with a foreign source, the value of which is $250,000 September 8, 2023 As Amended Through P.L.
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117 or more, considered alone or in combination with all other gifts from or contracts with that foreign source within a calendar year, the institution shall file a disclosure report with the Secretary on January 31 or July 31, whichever is sooner.
(b) CONTENTS OF REPORT.—Each report to the Secretary re- quired by this section shall contain the following: (1) For gifts received from or contracts entered into with a foreign source other than a foreign government, the aggre- gate dollar amount of such gifts and contracts attributable to a particular country.
The country to which a gift is attributable is the country of citizenship, or if unknown, the principal resi- dence for a foreign source who is a natural person, and the country of incorporation, or if unknown, the principal place of business, for a foreign source which is a legal entity.

(2) For gifts received from or contracts entered into with a foreign government, the aggregate amount of such gifts and contracts received from each foreign government.
(3) In the case of an institution which is owned or con- trolled by a foreign source, the identity of the foreign source, the date on which the foreign source assumed ownership or control, and any changes in program or structure resulting from the change in ownership or control.
(c) ADDITIONAL DISCLOSURES FOR RESTRICTED AND CONDI- TIONAL GIFTS.—Notwithstanding the provisions of subsection (b), whenever any institution receives a restricted or conditional gift or contract from a foreign source, the institution shall disclose the fol- lowing: (1) For such gifts received from or contracts entered into with a foreign source other than a foreign government, the amount, the date, and a description of such conditions or re- strictions.
The report shall also disclose the country of citizen- ship, or if unknown, the principal residence for a foreign source which is a natural person, and the country of incorporation, or if unknown, the principal place of business for a foreign source which is a legal entity.

(2) For gifts received from or contracts entered into with a foreign government, the amount, the date, a description of such conditions or restrictions, and the name of the foreign government.
(d) RELATION TO OTHER REPORTING REQUIREMENTS.— (1) STATE REQUIREMENTS.—If an institution described under subsection (a) is within a State which has enacted re- quirements for public disclosure of gifts from or contracts with a foreign source that are substantially similar to the require- ments of this section, a copy of the disclosure report filed with the State may be filed with the Secretary in lieu of a report required under subsection (a).
The State in which the institu- tion is located shall provide to the Secretary such assurances as the Secretary may require to establish that the institution has met the requirements for public disclosure under State law if the State report is filed.

(2) USE OF OTHER FEDERAL REPORTS.—If an institution re- ceives a gift from, or enters into a contract with, a foreign source, where any other department, agency, or bureau of the September 8, 2023 As Amended Through P.L.
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117 HIGHER EDUCATION ACT OF 1965 28 executive branch requires a report containing requirements substantially similar to those required under this section, a copy of the report may be filed with the Secretary in lieu of a report required under subsection (a).
(e) PUBLIC INSPECTION.—All disclosure reports required by this section shall be public records open to inspection and copying dur- ing business hours.
(f) ENFORCEMENT.— (1) COURT ORDERS.—Whenever it appears that an institu- tion has failed to comply with the requirements of this section, including any rule or regulation promulgated under this sec- tion, a civil action may be brought by the Attorney General, at the request of the Secretary, in an appropriate district court of the United States, or the appropriate United States court of any territory or other place subject to the jurisdiction of the United States, to request such court to compel compliance with the requirements of this section.
(2) COSTS.—For knowing or willful failure to comply with the requirements of this section, including any rule or regula- tion promulgated thereunder, an institution shall pay to the Treasury of the United States the full costs to the United States of obtaining compliance, including all associated costs of investigation and enforcement.

(g) REGULATIONS.—The Secretary may promulgate regulations to carry out this section.
(h) DEFINITIONS.—For the purpose of this section— (1) the term ‘‘contract’’ means any agreement for the acqui- sition by purchase, lease, or barter of property or services by the foreign source, for the direct benefit or use of either of the parties; (2) the term ‘‘foreign source’’ means— (A) a foreign government, including an agency of a for- eign government; (B) a legal entity, governmental or otherwise, created solely under the laws of a foreign state or states; (C) an individual who is not a citizen or a national of the United States or a trust territory or protectorate there- of; and (D) an agent, including a subsidiary or affiliate of a foreign legal entity, acting on behalf of a foreign source; (3) the term ‘‘gift’’ means any gift of money or property; (4) the term ‘‘institution’’ means any institution, public or private, or, if a multicampus institution, any single campus of such institution, in any State, that— (A) is legally authorized within such State to provide a program of education beyond secondary school; (B) provides a program for which the institution awards a bachelor’s degree (or provides not less than a 2- year program which is acceptable for full credit toward such a degree) or more advanced degrees; and (C) is accredited by a nationally recognized accrediting agency or association and to which institution Federal fi- nancial assistance is extended (directly or indirectly through another entity or person), or which institution re- September 8, 2023 As Amended Through P.L.
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119 ceives support from the extension of Federal financial as- sistance to any of the institution’s subunits; and (5) the term ‘‘restricted or conditional gift or contract’’ means any endowment, gift, grant, contract, award, present, or property of any kind which includes provisions regarding— (A) the employment, assignment, or termination of fac- ulty; (B) the establishment of departments, centers, re- search or lecture programs, or new faculty positions; (C) the selection or admission of students; or (D) the award of grants, loans, scholarships, fellow- ships, or other forms of financial aid restricted to students of a specified country, religion, sex, ethnic origin, or polit- ical opinion.
SEC.

118. ø20 U.S.C.

1011g¿ APPLICATION OF PEER REVIEW PROCESS.

All applications submitted under the provisions of this Act which require peer review shall be read by a panel of readers com- posed of individuals selected by the Secretary, which shall include outside readers who are not employees of the Federal Government.
The Secretary shall ensure that no individual assigned under this section to review any application has any conflict of interest with regard to that application which might impair the impartiality with which that individual conducts the review under this section.

SEC.

119. ø20 U.S.C.

1011h¿ BINGE DRINKING ON COLLEGE CAMPUSES.

(a) SHORT TITLE.—This section may be cited as the ‘‘Collegiate Initiative To Reduce Binge Drinking and Illegal Alcohol Consump- tion’’.
(b) SENSE OF CONGRESS.—It is the sense of Congress that, in an effort to change the culture of alcohol consumption on college campuses, all institutions of higher education should carry out the following: (1) The president of the institution should appoint a task force consisting of school administrators, faculty, students, Greek system representatives, and others to conduct a full ex- amination of student and academic life at the institution.
The task force should make recommendations for a broad range of policy and program changes that would serve to reduce alcohol and other drug-related problems.

The institution should pro- vide resources to assist the task force in promoting the campus policies and proposed environmental changes that have been identified.
(2) The institution should provide maximum opportunities for students to live in an alcohol-free environment and to en- gage in stimulating, alcohol-free recreational and leisure activi- ties.

(3) The institution should enforce a ‘‘zero tolerance’’ policy on the illegal consumption of alcohol by students at the institu- tion.

(4) The institution should vigorously enforce the institu- tion’s code of disciplinary sanctions for those who violate cam- pus alcohol policies.
Students with alcohol or other drug-re- lated problems should be referred for assistance, including on- campus counseling programs if appropriate.

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120 HIGHER EDUCATION ACT OF 1965 30 (5) The institution should adopt a policy to discourage alco- holic beverage-related sponsorship of on-campus activities.

It should adopt policies limiting the advertisement and promotion of alcoholic beverages on campus.

(6) The institution should work with the local community, including local businesses, in a ‘‘Town/Gown’’ alliance to en- courage responsible policies toward alcohol consumption and to address illegal alcohol use by students.

SEC.

120. ø20 U.S.C.


1011i¿ DRUG AND ALCOHOL ABUSE PREVENTION.
(a) RESTRICTION ON ELIGIBILITY.—Notwithstanding any other provision of law, no institution of higher education shall be eligible to receive funds or any other form of financial assistance under any Federal program, including participation in any federally funded or guaranteed student loan program, unless the institution certifies to the Secretary that the institution has adopted and has imple- mented a program to prevent the use of illicit drugs and the abuse of alcohol by students and employees that, at a minimum, in- cludes— (1) the annual distribution to each student and employee of— (A) standards of conduct that clearly prohibit, at a minimum, the unlawful possession, use, or distribution of illicit drugs and alcohol by students and employees on the institution’s property or as part of any of the institution’s activities; (B) a description of the applicable legal sanctions under local, State, or Federal law for the unlawful posses- sion or distribution of illicit drugs and alcohol; (C) a description of the health-risks associated with the use of illicit drugs and the abuse of alcohol; (D) a description of any drug or alcohol counseling, treatment, or rehabilitation or re-entry programs that are available to employees or students; and (E) a clear statement that the institution will impose sanctions on students and employees (consistent with local, State, and Federal law), and a description of those sanctions, up to and including expulsion or termination of employment and referral for prosecution, for violations of the standards of conduct required by subparagraph (A); and (2) a biennial review by the institution of the institution’s program to— (A) determine the program’s effectiveness and imple- ment changes to the program if the changes are needed; (B) determine the number of drug and alcohol-related violations and fatalities that— (i) occur on the institution’s campus (as defined in section 485(f)(6)), or as part of any of the institution’s activities; and (ii) are reported to campus officials; (C) determine the number and type of sanctions de- scribed in paragraph (1)(E) that are imposed by the insti- tution as a result of drug and alcohol-related violations September 8, 2023 As Amended Through P.L.
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120 and fatalities on the institution’s campus or as part of any of the institution’s activities; and (D) ensure that the sanctions required by paragraph (1)(E) are consistently enforced.
(b) INFORMATION AVAILABILITY.—Each institution of higher education that provides the certification required by subsection (a) shall, upon request, make available to the Secretary and to the public a copy of each item required by subsection (a)(1) as well as the results of the biennial review required by subsection (a)(2).
(c) REGULATIONS.— (1) IN GENERAL.—The Secretary shall publish regulations to implement and enforce the provisions of this section, includ- ing regulations that provide for— (A) the periodic review of a representative sample of programs required by subsection (a); and (B) a range of responses and sanctions for institutions of higher education that fail to implement their programs or to consistently enforce their sanctions, including infor- mation and technical assistance, the development of a compliance agreement, and the termination of any form of Federal financial assistance.
(2) REHABILITATION PROGRAM.—The sanctions required by subsection (a)(1)(E) may include the completion of an appro- priate rehabilitation program.
(d) APPEALS.—Upon determination by the Secretary to termi- nate financial assistance to any institution of higher education under this section, the institution may file an appeal with an ad- ministrative law judge before the expiration of the 30-day period beginning on the date such institution is notified of the decision to terminate financial assistance under this section.
Such judge shall hold a hearing with respect to such termination of assistance before the expiration of the 45-day period beginning on the date that such appeal is filed.

Such judge may extend such 45-day period upon a motion by the institution concerned.

The decision of the judge with respect to such termination shall be considered to be a final agency action.
(e) ALCOHOL AND DRUG ABUSE PREVENTION GRANTS.— (1) PROGRAM AUTHORITY.—The Secretary may make grants to institutions of higher education or consortia of such institu- tions, and enter into contracts with such institutions, con- sortia, and other organizations, to develop, implement, operate, improve, and disseminate programs of prevention, and edu- cation (including treatment-referral) to reduce and eliminate the illegal use of drugs and alcohol and the violence associated with such use.
Such grants or contracts may also be used for the support of a higher education center for alcohol and drug abuse prevention that will provide training, technical assist- ance, evaluation, dissemination, and associated services and assistance to the higher education community as determined by the Secretary and institutions of higher education.

(2) AWARDS.—Grants and contracts shall be awarded under paragraph (1) on a competitive basis.
(3) APPLICATIONS.—An institution of higher education, a consortium of such institutions, or another organization that September 8, 2023 As Amended Through P.L.

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121 HIGHER EDUCATION ACT OF 1965 32 desires to receive a grant or contract under paragraph (1) shall submit an application to the Secretary at such time, in such manner, and containing or accompanied by such information as the Secretary may reasonably require by regulation.
(4) ADDITIONAL REQUIREMENTS.— (A) PARTICIPATION.—In awarding grants and contracts under this subsection the Secretary shall make every effort to ensure— (i) the equitable participation of private and public institutions of higher education (including community and junior colleges); and (ii) the equitable geographic participation of such institutions.
(B) CONSIDERATION.—In awarding grants and con- tracts under this subsection the Secretary shall give appro- priate consideration to institutions of higher education with limited enrollment.

(5) AUTHORIZATION OF APPROPRIATIONS.—There are author- ized to be appropriated to carry out this subsection such sums as may be necessary for fiscal year 2009 and each of the five succeeding fiscal years.

SEC.

121. ø20 U.S.C.

1011j¿ PRIOR RIGHTS AND OBLIGATIONS.


(a) AUTHORIZATION OF APPROPRIATIONS.— (1) PRE-1987 PARTS C AND D OF TITLE VII.—There are au- thorized to be appropriated such sums as may be necessary for fiscal year 2009 and for each succeeding fiscal year to pay obli- gations incurred prior to 1987 under parts C and D of title VII, as such parts were in effect before the effective date of the Higher Education Amendments of 1992.
(2) POST-1992 AND PRE-1998 PART C OF TITLE VII.—There are authorized to be appropriated such sums as may be nec- essary for fiscal year 2009 and for each succeeding fiscal year to pay obligations incurred prior to the date of enactment of the Higher Education Amendments of 1998 under part C of title VII, as such part was in effect during the period— (A) after the effective date of the Higher Education Amendments of 1992; and (B) prior to the date of enactment of the Higher Edu- cation Amendments of 1998.
(b) LEGAL RESPONSIBILITIES.— (1) PRE-1987 TITLE VII.—All entities with continuing obli- gations incurred under parts A, B, C, and D of title VII, as such parts were in effect before the effective date of the Higher Education Amendments of 1992, shall be subject to the re- quirements of such part as in effect before the effective date of the Higher Education Amendments of 1992.
(2) POST-1992 AND PRE-1998 PART C OF TITLE VII.—All enti- ties with continuing obligations incurred under part C of title VII, as such part was in effect during the period— (A) after the effective date of the Higher Education Amendments of 1992; and (B) prior to the date of enactment of the Higher Edu- cation Amendments of 1998, September 8, 2023 As Amended Through P.L.
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123 shall be subject to the requirements of such part as such part was in effect during such period.

SEC.

122. ø20 U.S.C.

1011k¿ RECOVERY OF PAYMENTS.
(a) PUBLIC BENEFIT.—Congress declares that, if a facility con- structed with the aid of a grant under part A of title VII as such part A was in effect prior to the date of enactment of the Higher Education Amendments of 1998, or part B of such title as part B was in effect prior to the date of enactment of the Higher Edu- cation Amendments of 1992, is used as an academic facility for 20 years following completion of such construction, the public benefit accruing to the United States will equal in value the amount of the grant.
The period of 20 years after completion of such construction shall therefore be deemed to be the period of Federal interest in such facility for the purposes of such title as so in effect.
(b) RECOVERY UPON CESSATION OF PUBLIC BENEFIT.—If, within 20 years after completion of construction of an academic facility which has been constructed, in part with a grant under part A of title VII as such part A was in effect prior to the date of enactment of the Higher Education Amendments of 1998, or part B of title VII as such part B was in effect prior to the date of enactment of the Higher Education Amendments of 1992— (1) the applicant under such parts as so in effect (or the applicant’s successor in title or possession) ceases or fails to be a public or nonprofit institution; or (2) the facility ceases to be used as an academic facility, or the facility is used as a facility excluded from the term ‘‘aca- demic facility’’ (as such term was defined under title VII, as so in effect), unless the Secretary determines that there is good cause for releasing the institution from its obligation, the United States shall be entitled to recover from such applicant (or successor) an amount which bears to the value of the facility at that time (or so much thereof as constituted an approved project or projects) the same ratio as the amount of Federal grant bore to the cost of the facility financed with the aid of such grant.
The value shall be determined by agreement of the parties or by action brought in the United States district court for the district in which such facility is situated.

(c) PROHIBITION ON USE FOR RELIGION.—Notwithstanding the provisions of subsections (a) and (b), no project assisted with funds under title VII (as in effect prior to the date of enactment of the Higher Education Amendments of 1998) shall ever be used for reli- gious worship or a sectarian activity or for a school or department of divinity.
SEC.

123. ø20 U.S.C.

1011l¿ DIPLOMA MILLS.

(a) INFORMATION TO THE PUBLIC.—The Secretary shall main- tain information and resources on the Department’s website to as- sist students, families, and employers in understanding what a di- ploma mill is and how to identify and avoid diploma mills.
(b) COLLABORATION.—The Secretary shall continue to collabo- rate with the United States Postal Service, the Federal Trade Com- mission, the Department of Justice (including the Federal Bureau of Investigation), the Internal Revenue Service, and the Office of Personnel Management to maximize Federal efforts to— September 8, 2023 As Amended Through P.L.
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131 HIGHER EDUCATION ACT OF 1965 34 (1) prevent, identify, and prosecute diploma mills; and (2) broadly disseminate to the public information about di- ploma mills, and resources to identify diploma mills.

PART C—COST OF HIGHER EDUCATION SEC.

131. ø20 U.S.C.
131. ø20 U.S.C.

1015¿ IMPROVEMENTS IN MARKET INFORMATION AND PUBLIC ACCOUNTABILITY IN HIGHER EDUCATION.

(a) IMPROVED DATA COLLECTION.— (1) DEVELOPMENT OF UNIFORM METHODOLOGY.—The Sec- retary shall direct the Commissioner of Education Statistics to convene a series of forums to develop nationally consistent methodologies for reporting costs incurred by postsecondary in- stitutions in providing postsecondary education.
(2) REDESIGN OF DATA SYSTEMS.—On the basis of the meth- odologies developed pursuant to paragraph (1), the Secretary shall redesign relevant parts of the postsecondary education data systems to improve the usefulness and timeliness of the data collected by such systems.
(3) INFORMATION TO INSTITUTIONS.—The Commissioner of Education Statistics shall— (A) develop a standard definition for the following data elements: (i) tuition and fees for a full-time undergraduate student; (ii) cost of attendance for a full-time under- graduate student, consistent with the provisions of section 472; (iii) average amount of financial assistance re- ceived by an undergraduate student who attends an institution of higher education, including— (I) each type of assistance or benefit described in section 428(a)(2)(C)(ii); (II) fellowships; and (III) institutional and other assistance; and (iv) number of students receiving financial assist- ance described in each of subclauses (I), (II), and (III) of clause (iii); (B) not later than 90 days after the date of enactment of the Higher Education Amendments of 1998, report the definitions to each institution of higher education and within a reasonable period of time thereafter inform the authorizing committees of those definitions; and (C) collect information regarding the data elements de- scribed in subparagraph (A) with respect to at least all in- stitutions of higher education participating in programs under title IV, beginning with the information from aca- demic year 2000–2001 and annually thereafter.
(b) DATA DISSEMINATION.—The Secretary shall make available the data collected pursuant to subsection (a).

Such data shall be available in a form that permits the review and comparison of the data submissions of individual institutions of higher education.

Such data shall be presented in a form that is easily understand- September 8, 2023 As Amended Through P.L.
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131 able and allows parents and students to make informed decisions based on the costs for typical full-time undergraduate students.
(c) STUDY.— (1) IN GENERAL.—The Commissioner of Education Statis- tics shall conduct a national study of expenditures at institu- tions of higher education.
Such study shall include information with respect to— (A) the change in tuition and fees compared with the consumer price index and other appropriate measures of inflation; (B) faculty salaries and benefits; (C) administrative salaries, benefits and expenses; (D) academic support services; (E) research; (F) operations and maintenance; and (G) institutional expenditures for construction and technology and the potential cost of replacing instructional buildings and equipment.
(2) EVALUATION.—The study shall include an evaluation of— (A) changes over time in the expenditures identified in paragraph (1); (B) the relationship of the expenditures identified in paragraph (1) to college costs; and (C) the extent to which increases in institutional fi- nancial aid and tuition discounting practices affect tuition increases, including the demographics of students receiv- ing such discounts, the extent to which financial aid is pro- vided to students with limited need in order to attract a student to a particular institution, and the extent to which Federal financial aid, including loan aid, has been used to offset the costs of such practices.
(3) FINAL REPORT.—The Commissioner of Education Statis- tics shall submit a report regarding the findings of the study required by paragraph (1) to the appropriate committees of Congress not later than September 30, 2002.

(4) HIGHER EDUCATION MARKET BASKET.—The Bureau of Labor Statistics, in consultation with the Commissioner of Education Statistics, shall develop a higher education market basket that identifies the items that comprise the costs of high- er education.
The Bureau of Labor Statistics shall provide a re- port on the market basket to the Committee on Labor and Human Resources of the Senate and the Committee on Edu- cation and the Workforce of the House of Representatives not later than September 30, 2002.
(5) FINES.—In addition to actions authorized in section 487(c), the Secretary may impose a fine in an amount not to exceed $25,000 on an institution of higher education for failing to provide the information described in paragraph (1) in a timely and accurate manner, or for failing to otherwise cooper- ate with the National Center for Education Statistics regarding efforts to obtain data on the cost of higher education under this section and pursuant to the program participation agreement entered into under section 487.
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131 HIGHER EDUCATION ACT OF 1965 36 (d) PROMOTION OF THE DEPARTMENT OF EDUCATION FEDERAL STUDENT FINANCIAL AID WEBSITE.—The Secretary shall display a link to the Federal student financial aid website of the Department in a prominent place on the homepage of the Department’s website.
(e) ENHANCED STUDENT FINANCIAL AID INFORMATION.— (1) IMPLEMENTATION.—The Secretary shall continue to im- prove the usefulness and accessibility of the information pro- vided by the Department on college planning and student fi- nancial aid.

(2) DISSEMINATION.—The Secretary shall continue to make the availability of the information on the Federal student fi- nancial aid website of the Department widely known, through a major media campaign and other forms of communication.
(3) COORDINATION.—As a part of the efforts required under this subsection, the Secretary shall create one website acces- sible from the Department’s website that fulfills the require- ments under subsections (b), (f), and (g).
(f) IMPROVED AVAILABILITY AND COORDINATION OF INFORMA- TION CONCERNING STUDENT FINANCIAL AID PROGRAMS FOR MILI- TARY MEMBERS AND VETERANS.— (1) COORDINATION.—The Secretary, in coordination with the Secretary of Defense and the Secretary of Veterans Affairs, shall create a searchable website that— (A) contains information, in simple and understand- able terms, about all Federal and State student financial assistance, readmission requirements under section 484C, and other student services, for which members of the Armed Forces (including members of the National Guard and Reserves), veterans, and the dependents of such mem- bers or veterans may be eligible; and (B) is easily accessible through the website described in subsection (e)(3).
(2) IMPLEMENTATION.—Not later than one year after the date of enactment of the Higher Education Opportunity Act, the Secretary shall make publicly available the Armed Forces information website described in paragraph (1).
(3) DISSEMINATION.—The Secretary, in coordination with the Secretary of Defense and the Secretary of Veterans Affairs, shall make the availability of the Armed Forces information website described in paragraph (1) widely known to members of the Armed Forces (including members of the National Guard and Reserves), veterans, the dependents of such members or veterans, States, institutions of higher education, and the gen- eral public.
(4) DEFINITION.—In this subsection, the term ‘‘Federal and State student financial assistance’’ means any grant, loan, work assistance, tuition assistance, scholarship, fellowship, or other form of financial aid for pursuing a postsecondary edu- cation that is— (A) administered, sponsored, or supported by the De- partment of Education, the Department of Defense, the Department of Veterans Affairs, or a State; and September 8, 2023 As Amended Through P.L.
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131 (B) available to members of the Armed Forces (includ- ing members of the National Guard and Reserves), vet- erans, or the dependents of such members or veterans.
(g) PROMOTION OF AVAILABILITY OF INFORMATION CONCERNING OTHER STUDENT FINANCIAL AID PROGRAMS.— (1) DEFINITION.—For purposes of this subsection, the term ‘‘nondepartmental student financial assistance program’’ means any grant, loan, scholarship, fellowship, or other form of finan- cial aid for students pursuing a postsecondary education that is— (A) distributed directly to the student or to the stu- dent’s account at an institution of higher education; and (B) operated, sponsored, or supported by a Federal de- partment or agency other than the Department of Edu- cation.
(2) AVAILABILITY OF OTHER STUDENT FINANCIAL AID INFOR- MATION.—The Secretary shall ensure that— (A) not later than 90 days after the Secretary receives the information required under paragraph (3), the eligi- bility requirements, application procedures, financial terms and conditions, and other relevant information for each nondepartmental student financial assistance program are searchable and accessible through the Federal student fi- nancial aid website in a manner that is simple and under- standable for students and the students’ families; and (B) the website displaying the information described in subparagraph (A) includes a link to the National Database on Financial Assistance for the Study of Science, Tech- nology, Engineering, and Mathematics pursuant to para- graph (4), and the information on military benefits under subsection (f), once such Database and information are available.
(3) NONDEPARTMENTAL STUDENT FINANCIAL ASSISTANCE PROGRAMS.—The Secretary shall request all Federal depart- ments and agencies to provide the information described in paragraph (2)(A), and each Federal department or agency shall— (A) promptly respond to surveys or other requests from the Secretary for the information described in such paragraph; and (B) identify for the Secretary any nondepartmental student financial assistance program operated, sponsored, or supported by such Federal department or agency.
(4) NATIONAL STEM DATABASE.— (A) IN GENERAL.—The Secretary shall establish and maintain, on the website described in subsection (e)(3), a National Database on Financial Assistance for the Study of Science, Technology, Engineering, and Mathematics (in this paragraph referred to as the ‘‘STEM Database’’).
The STEM Database shall consist of information on scholar- ships, fellowships, and other programs of Federal, State, local, and, to the maximum extent practicable, private fi- nancial assistance available for the study of science, tech- September 8, 2023 As Amended Through P.L.

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131 HIGHER EDUCATION ACT OF 1965 38 nology, engineering, or mathematics at the postsecondary and postbaccalaureate levels.

(B) DATABASE CONTENTS.—The information main- tained on the STEM Database shall be displayed on the website in the following manner: (i) SEPARATE INFORMATION.—The STEM Database shall provide separate information for each of the fields of science, technology, engineering, and mathe- matics, and for postsecondary and postbaccalaureate programs of financial assistance.
(ii) INFORMATION ON TARGETED ASSISTANCE.—The STEM Database shall provide specific information on any program of financial assistance that is targeted to individuals based on financial need, merit, or student characteristics.
(iii) CONTACT AND WEBSITE INFORMATION.—The STEM Database shall provide— (I) standard contact information that an inter- ested person may use to contact a sponsor of any program of financial assistance included in the STEM Database; and (II) if such sponsor maintains a public website, a link to the website.
(iv) SEARCH AND MATCH CAPABILITIES.—The STEM Database shall— (I) have a search capability that permits an individual to search for information on the basis of each category of the information provided through the STEM Database and on the basis of combina- tions of categories of the information provided, in- cluding— (aa) whether the financial assistance is need- or merit-based; and (bb) by relevant academic majors; and (II) have a match capability that— (aa) searches the STEM Database for all financial assistance opportunities for which an individual may be qualified to apply, based on the student characteristics provided by such individual; and (bb) provides information to an individual for only those opportunities for which such in- dividual is qualified, based on the student characteristics provided by such individual.
(v) RECOMMENDATION AND DISCLAIMER.—The STEM Database shall provide, to the users of the STEM Database— (I) a recommendation that students and fami- lies should carefully review all of the application requirements prior to applying for any aid or pro- gram of student financial assistance; and (II) a disclaimer that the non-Federal pro- grams of student financial assistance presented in September 8, 2023 As Amended Through P.L.
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132 the STEM Database are not provided or endorsed by the Department or the Federal Government.
(C) COMPILATION OF FINANCIAL ASSISTANCE INFORMA- TION.—In carrying out this paragraph, the Secretary shall— (i) consult with public and private sources of scholarships, fellowships, and other programs of stu- dent financial assistance; and (ii) make easily available a process for such enti- ties to provide regular and updated information about the scholarships, fellowships, or other programs of stu- dent financial assistance.
(D) CONTRACT AUTHORIZED.—In carrying out the re- quirements of this paragraph, the Secretary is authorized to enter into a contract with a private entity with dem- onstrated expertise in creating and maintaining databases such as the one required under this paragraph, under which contract the entity shall furnish, and regularly up- date, all of the information required to be maintained on the STEM Database.
(5) DISSEMINATION OF INFORMATION.—The Secretary shall take such actions, on an ongoing basis, as may be necessary to disseminate information under this subsection and to encour- age the use of the information by interested parties, including sending notices to secondary schools and institutions of higher education.
(h) NO USER FEES FOR DEPARTMENT FINANCIAL AID WEBSITES.—No fee shall be charged to any individual to access— (1) a database or website of the Department that provides information about higher education programs or student finan- cial assistance, including the College Navigator website (or successor website) and the websites and databases described in this section and section 132; or (2) information about higher education programs or stu- dent financial assistance available through a database or website of the Department.
SEC.

132. ø20 U.S.C.

1015a¿ TRANSPARENCY IN COLLEGE TUITION FOR CONSUMERS.

(a) DEFINITIONS.—In this section: (1) COLLEGE NAVIGATOR WEBSITE.—The term ‘‘College Nav- igator website’’ means the College Navigator website operated by the Department and includes any successor website.
(2) COST OF ATTENDANCE.—The term ‘‘cost of attendance’’ means the average annual cost of tuition and fees, room and board, books, supplies, and transportation for an institution of higher education for a first-time, full-time undergraduate stu- dent enrolled in the institution.
(3) NET PRICE.—The term ‘‘net price’’ means the average yearly price actually charged to first-time, full-time under- graduate students receiving student aid at an institution of higher education after deducting such aid, which shall be de- termined by calculating the difference between— (A) the institution’s cost of attendance for the year for which the determination is made; and September 8, 2023 As Amended Through P.L.
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132 HIGHER EDUCATION ACT OF 1965 40 (B) the quotient of— (i) the total amount of need-based grant aid and merit-based grant aid, from Federal, State, and insti- tutional sources, provided to such students enrolled in the institution for such year; and (ii) the total number of such students receiving such need-based grant aid or merit-based grant aid for such year.
(4) TUITION AND FEES.—The term ‘‘tuition and fees’’ means the average annual cost of tuition and fees for an institution of higher education for first-time, full-time undergraduate stu- dents enrolled in the institution.
(b) CALCULATIONS FOR PUBLIC INSTITUTIONS.—In making the calculations regarding cost of attendance, net price, and tuition and fees under this section with respect to a public institution of higher education, the Secretary shall calculate the cost of attendance, net price, and tuition and fees at such institution in the manner de- scribed in subsection (a), except that— (1) the cost of attendance, net price, and tuition and fees shall be calculated for first-time, full-time undergraduate stu- dents enrolled in the institution who are residents of the State in which such institution is located; and (2) in determining the net price, the average need-based grant aid and merit-based grant aid described in subsection (a)(3)(B) shall be calculated based on the average total amount of such aid received by first-time, full-time undergraduate stu- dents who are residents of the State in which such institution is located, divided by the total number of such resident stu- dents receiving such need-based grant aid or merit-based grant aid at such institution.
(c) COLLEGE AFFORDABILITY AND TRANSPARENCY LISTS.— (1) AVAILABILITY OF LISTS.—Beginning July 1, 2011, the Secretary shall make publicly available on the College Navi- gator website, in a manner that is sortable and searchable by State, the following: (A) A list of the five percent of institutions in each cat- egory described in subsection (d) that have the highest tui- tion and fees for the most recent academic year for which data are available.
(B) A list of the five percent of institutions in each such category that have the highest net price for the most recent academic year for which data are available.

(C) A list of the five percent of institutions in each such category that have the largest increase, expressed as a percentage change, in tuition and fees over the most re- cent three academic years for which data are available, using the first academic year of the three-year period as the base year to compute such percentage change.
(D) A list of the five percent of institutions in each such category that have the largest increase, expressed as a percentage change, in net price over the most recent three academic years for which data are available, using the first academic year of the three-year period as the base year to compute such percentage change.

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132 (E) A list of the ten percent of institutions in each such category that have the lowest tuition and fees for the most recent academic year for which data are available.
(F) A list of the ten percent of institutions in each such category that have the lowest net price for the most recent academic year for which data are available.

(2) ANNUAL UPDATES.—The Secretary shall annually up- date the lists described in paragraph (1) on the College Navi- gator website.
(d) CATEGORIES OF INSTITUTIONS.—The lists described in sub- section (c)(1) shall be compiled according to the following categories of institutions that participate in programs under title IV: (1) Four-year public institutions of higher education.

(2) Four-year private, nonprofit institutions of higher edu- cation.

cation.

cation.

(3) Four-year private, for-profit institutions of higher edu- (4) Two-year public institutions of higher education.
(5) Two-year private, nonprofit institutions of higher edu- (6) Two-year private, for-profit institutions of higher edu- cation.

(7) Less than two-year public institutions of higher edu- cation.

(8) Less than two-year private, nonprofit institutions of higher education.

(9) Less than two-year private, for-profit institutions of higher education.
(e) REPORTS BY INSTITUTIONS.— (1) REPORT TO SECRETARY.—If an institution of higher edu- cation is included on a list described in subparagraph (C) or (D) of subsection (c)(1), the institution shall submit to the Sec- retary a report containing the following information: (A) A description of the major areas in the institution’s budget with the greatest cost increases.

(B) An explanation of the cost increases described in subparagraph (A).
(C) A description of the steps the institution will take toward the goal of reducing costs in the areas described in subparagraph (A).

(D) In the case of an institution that is included on the same list under subparagraph (C) or (D) of subsection (c)(1) for two or more consecutive years, a description of the progress made on the steps described in subparagraph (C) of this paragraph that were included in the institu- tion’s report for the previous year.
(E) If the determination of any cost increase described in subparagraph (A) is not within the exclusive control of the institution— (i) an explanation of the extent to which the insti- tution participates in determining such cost increase; (ii) the identification of the agency or instrumen- tality of State government responsible for determining such cost increase; and September 8, 2023 As Amended Through P.L.
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132 HIGHER EDUCATION ACT OF 1965 42 (iii) any other information the institution con- siders relevant to the report.
(2) INFORMATION TO THE PUBLIC.—The Secretary shall— (A) issue an annual report that summarizes all of the reports by institutions required under paragraph (1) to the authorizing committees; and (B) publish such report on the College Navigator website.
(f) EXEMPTIONS.— (1) IN GENERAL.—An institution shall not be placed on a list described in subparagraph (C) or (D) of subsection (c)(1), and shall not be subject to the reporting required under sub- section (e), if the dollar amount of the institution’s increase in tuition and fees, or net price, as applicable, is less than $600 for the three-year period described in such subparagraph.
(2) UPDATE.—Beginning in 2014, and every three years thereafter, the Secretary shall update the dollar amount de- scribed in paragraph (1) based on annual increases in inflation, using the Consumer Price Index for each of the three most re- cent preceding years.
(g) STATE HIGHER EDUCATION SPENDING CHART.—The Sec- retary shall annually report on the College Navigator website, in charts for each State, comparisons of— (1) the percentage change in spending by such State per full-time equivalent student at all public institutions of higher education in such State, for each of the five most recent pre- ceding academic years; (2) the percentage change in tuition and fees for such stu- dents for all public institutions of higher education in such State for each of the five most recent preceding academic years; and (3) the percentage change in the total amount of need- based aid and merit-based aid provided by such State to full- time students enrolled in the public institutions of higher edu- cation in the State for each of the five most recent preceding academic years.
(h) NET PRICE CALCULATOR.— (1) DEVELOPMENT OF NET PRICE CALCULATOR.—Not later than one year after the date of enactment of theHigher Edu- cation Opportunity Act, the Secretary shall, in consultation with institutions of higher education and other appropriate ex- perts, develop a net price calculator to help current and pro- spective students, families, and other consumers estimate the individual net price of an institution of higher education for a student.
The calculator shall be developed in a manner that enables current and prospective students, families, and con- sumers to determine an estimate of a current or prospective student’s individual net price at a particular institution.
(2) CALCULATION OF INDIVIDUAL NET PRICE.—For purposes of this subsection, an individual net price of an institution of higher education shall be calculated in the same manner as the net price of such institution is calculated under subsection (a)(3), except that the cost of attendance and the amount of September 8, 2023 As Amended Through P.L.
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132 need-based and merit-based aid available shall be calculated for the individual student as much as practicable.
(3) USE OF NET PRICE CALCULATOR BY INSTITUTIONS.—Not later than two years after the date on which the Secretary makes the calculator developed under paragraph (1) available to institutions of higher education, each institution of higher education that receives Federal funds under title IV shall make publicly available on the institution’s website a net price calculator to help current and prospective students, families, and other consumers estimate a student’s individual net price at such institution of higher education.
Such calculator may be a net price calculator developed— (A) by the Department pursuant to paragraph (1); or (B) by the institution of higher education, if the insti- tution’s calculator includes, at a minimum, the same data elements included in the calculator developed under para- graph (1).
(4) DISCLAIMER.—Estimates of an individual net price de- termined using a net price calculator required under para- graph (3) shall be accompanied by a clear and conspicuous no- tice— (A) stating that the estimate— (i) does not represent a final determination, or ac- tual award, of financial assistance; (ii) shall not be binding on the Secretary, the in- stitution of higher education, or the State; and (iii) may change; (B) stating that the student must complete the Free Application for Federal Student Aid described in section 483 in order to be eligible for, and receive, an actual finan- cial aid award that includes Federal grant, loan, or work- study assistance under title IV; and (C) including a link to the website of the Department that allows students to access the Free Application for Federal Student Aid described in section 483.
(i) CONSUMER INFORMATION.— (1) AVAILABILITY OF TITLE IV INSTITUTION INFORMATION.— Not later than one year after the date of enactment of the Higher Education Opportunity Act, the Secretary shall make publicly available on the College Navigator website, in simple and understandable terms, the following information about each institution of higher education that participates in pro- grams under title IV, for the most recent academic year for which satisfactory data are available: (A) A statement of the institution’s mission.
(B) The total number of undergraduate students who applied to, were admitted by, and enrolled in the institu- tion.

(C) For institutions that require SAT or ACT scores to be submitted, the reading, writing, mathematics, and com- bined scores on the SAT or ACT, as applicable, for the middle 50 percent range of the institution’s freshman class.

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132 HIGHER EDUCATION ACT OF 1965 44 (D) The number of first-time, full-time, and part-time students enrolled at the institution, at the undergraduate and (if applicable) graduate levels.
(E) The number of degree- or certificate-seeking un- dergraduate students enrolled at the institution who have transferred from another institution.

(F) The percentages of male and female undergraduate students enrolled at the institution.
(G) Of the first-time, full-time, degree- or certificate- seeking undergraduate students enrolled at the institu- tion— (i) the percentage of such students who are from the State in which the institution is located; (ii) the percentage of such students who are from other States; and (iii) the percentage of such students who are inter- national students.
(H) The percentages of first-time, full-time, degree- or certificate-seeking students enrolled at the institution, disaggregated by race and ethnic background.

(I) The percentage of undergraduate students enrolled at the institution who are formally registered with the of- fice of disability services of the institution (or the equiva- lent office) as students with disabilities, except that if such percentage is three percent or less, the institution shall re- port ‘‘three percent or less’’.
(J) The percentages of first-time, full-time, degree- or certificate-seeking undergraduate students enrolled at the institution who obtain a degree or certificate within— (i) the normal time for completion of, or gradua- tion from, the student’s program; (ii) 150 percent of the normal time for completion of, or graduation from, the student’s program; and (iii) 200 percent of the normal time for completion of, or graduation from, the student’s program; (K) The number of certificates, associate degrees, bac- calaureate degrees, master’s degrees, professional degrees, and doctoral degrees awarded by the institution.
(L) The undergraduate major areas of study at the in- stitution with the highest number of degrees awarded.

(M) The student-faculty ratio, the number of full-time and part-time faculty, and the number of graduate assist- ants with primarily instructional responsibilities, at the in- stitution.
(N)(i) The cost of attendance for first-time, full-time undergraduate students enrolled in the institution who live on campus; (ii) the cost of attendance for first-time, full-time un- dergraduate students enrolled in the institution who live off campus; and (iii) in the case of a public institution of higher edu- cation and notwithstanding subsection (b)(1), the costs de- scribed in clauses (i) and (ii), for— September 8, 2023 As Amended Through P.L.
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132 (I) first-time, full-time students enrolled in the in- stitution who are residents of the State in which the institution is located; and (II) first-time, full-time students enrolled in the institution who are not residents of such State.
(O) The average annual grant amount (including Fed- eral, State, and institutional aid) awarded to a first-time, full-time undergraduate student enrolled at the institution who receives financial aid.

(P) The average annual amount of Federal student loans provided through the institution to undergraduate students enrolled at the institution.
(Q) The total annual grant aid awarded to under- graduate students enrolled at the institution, from the Federal Government, a State, the institution, and other sources known by the institution.
(R) The percentage of first-time, full-time under- graduate students enrolled at the institution receiving Federal, State, and institutional grants, student loans, and any other type of student financial assistance known by the institution, provided publicly or through the institu- tion, such as Federal work-study funds.

(S) The number of students enrolled at the institution receiving Federal Pell Grants.

(T) The institution’s cohort default rate, as defined under section 435(m).
(U) The information on campus safety required to be collected under section 485(i).

(V) A link to the institution’s website that provides, in an easily accessible manner, the following information: (i) Student activities offered by the institution.

(ii) Services offered by the institution for individ- uals with disabilities.

(iii) Career and placement services offered by the institution to students during and after enrollment.
(iv) Policies of the institution related to transfer of credit from other institutions.

(W) A link to the appropriate section of the Bureau of Labor Statistics website that provides information on re- gional data on starting salaries in all major occupations.

(X) Information required to be submitted under para- graph (4) and a link to the institution pricing summary page described in paragraph (5).
(Y) In the case of an institution that was required to submit a report under subsection (e)(1), a link to such re- port.

(Z) The availability of alternative tuition plans, which may include guaranteed tuition plans.

(2) ANNUAL UPDATES.—The Secretary shall annually up- date the information described in paragraph (1) on the College Navigator website.
(3) CONSULTATION.—The Secretary shall regularly consult with current and prospective college students, family members of such students, institutions of higher education, and other ex- September 8, 2023 As Amended Through P.L.

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132 HIGHER EDUCATION ACT OF 1965 46 perts to improve the usefulness and relevance of the College Navigator website, with respect to the presentation of the con- sumer information collected in paragraph (1).

(4) DATA COLLECTION.—The Commissioner for Education Statistics shall continue to update and improve the Integrated Postsecondary Education Data System (referred to in this sec- tion as ‘‘IPEDS’’), including the reporting of information by in- stitutions and the timeliness of the data collected.
(5) INSTITUTION PRICING SUMMARY PAGE.— (A) AVAILABILITY OF LIST OF PARTICIPATING INSTITU- TIONS.—The Secretary shall make publicly available on the College Navigator website in a sortable and searchable for- mat a list of all institutions of higher education that par- ticipate in programs under title IV, which list shall, for each institution, include the following: (i) The tuition and fees for each of the three most recent academic years for which data are available.
(ii) The net price for each of the three most recent available academic years for which data are available.

(iii)(I) During the period beginning July 1, 2010, and ending June 30, 2013, the net price for students receiving Federal student financial aid under title IV, disaggregated by the income categories described in paragraph (6), for the most recent academic year for which data are available.
(II) Beginning July 1, 2013, the net price for stu- dents receiving Federal student financial aid under title IV, disaggregated by the income categories de- scribed in paragraph (6), for each of the three most re- cent academic years for which data are available.

(iv) The average annual percentage change and average annual dollar change in such institution’s tui- tion and fees for each of the three most recent aca- demic years for which data are available.
(v) The average annual percentage change and av- erage annual dollar change in such institution’s net price for each of the three most recent preceding aca- demic years for which data are available.

(vi) A link to the webpage on the College Navi- gator website that provides the information described in paragraph (1) for the institution.

(B) ANNUAL UPDATES.—The Secretary shall annually update the lists described in subparagraph (A) on the Col- lege Navigator website.
(6) INCOME CATEGORIES.— (A) IN GENERAL.—For purposes of reporting the infor- mation required under this subsection, the following in- come categories shall apply for students who receive Fed- eral student financial aid under title IV: (i) $0–30,000.

(ii) $30,001–48,000.

(iii) $48,001–75,000.

(iv) $75,001–110,000.

(v) $110,001 and more.

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132 (B) ADJUSTMENT.—The Secretary may adjust the in- come categories listed in subparagraph (A) using the Con- sumer Price Index if the Secretary determines such adjust- ment is necessary.
(j) MULTI-YEAR TUITION CALCULATOR.— (1) DEVELOPMENT OF MULTI-YEAR TUITION CALCULATOR.— Not later than one year after the date of enactment of theHigher Education Opportunity Act, the Secretary shall, in consultation with institutions of higher education, financial planners, and other appropriate experts, develop a multi-year tuition calculator to help current and prospective students, families of such students, and other consumers estimate the amount of tuition an individual may pay to attend an institu- tion of higher education in future years.
(2) CALCULATION OF MULTI-YEAR TUITION.—The multi-year tuition calculator described in paragraph (1) shall— (A) allow an individual to select an institution of high- er education for which the calculation shall be made; (B) calculate an estimate of tuition and fees for each year of the normal duration of the program of study at such institution by— (i) using the tuition and fees for such institution, as reported under subsection (i)(5)(A)(i), for the most recent academic year for which such data are reported; and (ii) determining an estimated annual percentage change for each year for which the calculation is made, based on the annual percentage change in such institution’s tuition and fees, as reported under sub- section (i)(5)(A)(iv), for the most recent three-year pe- riod for which such data are reported; (C) calculate an estimate of the total amount of tuition and fees to complete a program of study at such institu- tion, based on the normal duration of such program, using the estimate calculated under subparagraph (B) for each year of the program of study; (D) provide the individual with the option to replace the estimated annual percentage change described in sub- paragraph (B)(ii) with an alternative annual percentage change specified by the individual, and calculate an esti- mate of tuition and fees for each year and an estimate of the total amount of tuition and fees using the alternative percentage change; (E) in the case of an institution that offers a multi- year tuition guarantee program, allow the individual to have the estimates of tuition and fees described in sub- paragraphs (B) and (C) calculated based on the provisions of such guarantee program for the tuition and fees charged to a student, or cohort of students, enrolled for the dura- tion of the program of study; and (F) include any other features or information deter- mined to be appropriate by the Secretary.
(3) AVAILABILITY AND COMPARISON.—The multi-year tuition calculator described in paragraph (1) shall be available on the September 8, 2023 As Amended Through P.L.

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132 HIGHER EDUCATION ACT OF 1965 48 College Navigator website and shall allow current and prospec- tive students, families of such students, and consumers to com- pare information and estimates under this subsection for mul- tiple institutions of higher education.
(4) DISCLAIMER.—Each calculation of estimated tuition and fees made using the multi-year tuition calculator described in paragraph (1) shall be accompanied by a clear and conspicuous notice— (A) stating that the calculation— (i) is only an estimate and not a guarantee of the actual amount the student may be charged; (ii) is not binding on the Secretary, the institution of higher education, or the State; and (iii) may change, subject to the availability of fi- nancial assistance, State appropriations, and other factors; (B) stating that the student must complete the Free Application for Federal Student Aid described in section 483 in order to be eligible for, and receive, an actual finan- cial aid award that includes Federal grant, loan, or work- study assistance under title IV; and (C) including a link to the website of the Department that allows students to access the Free Application for Federal Student Aid described in section 483.
(k) STUDENT AID RECIPIENT SURVEY.— (1) SURVEY REQUIRED.—The Secretary, acting through the Commissioner for Education Statistics, shall conduct, on a State-by-State basis, a survey of recipients of Federal student financial aid under title IV— (A) to identify the population of students receiving such Federal student financial aid; (B) to describe the income distribution and other socio- economic characteristics of recipients of such Federal stu- dent financial aid; (C) to describe the combinations of aid from Federal, State, and private sources received by such recipients from all income categories; (D) to describe the— (i) debt burden of such loan recipients, and their capacity to repay their education debts; and (ii) the impact of such debt burden on the recipi- ents’ course of study and post-graduation plans; (E) to describe the impact of the cost of attendance of postsecondary education in the determination by students of what institution of higher education to attend; and (F) to describe how the costs of textbooks and other in- structional materials affect the costs of postsecondary edu- cation for students.
(2) FREQUENCY.—The survey shall be conducted on a reg- ular cycle and not less often than once every four years.

(3) SURVEY DESIGN.—The survey shall be representative of students from all types of institutions, including full-time and part-time students, undergraduate, graduate, and professional students, and current and former students.

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133 (4) DISSEMINATION.—The Commissioner for Education Sta- tistics shall disseminate to the public, in printed and electronic form, the information resulting from the survey.
(l) REGULATIONS.—The Secretary is authorized to issue such regulations as may be necessary to carry out this section.

SEC.

133. ø20 U.S.C.

1015b¿ TEXTBOOK INFORMATION.

(a) PURPOSE AND INTENT.—The purpose of this section is to en- sure that students have access to affordable course materials by de- creasing costs to students and enhancing transparency and disclo- sure with respect to the selection, purchase, sale, and use of course materials.
It is the intent of this section to encourage all of the in- volved parties, including faculty, students, administrators, institu- tions of higher education, bookstores, distributors, and publishers, to work together to identify ways to decrease the cost of college textbooks and supplemental materials for students while sup- porting the academic freedom of faculty members to select high quality course materials for students.
(b) DEFINITIONS.—In this section: (1) BUNDLE.—The term ‘‘bundle’’ means one or more col- lege textbooks or other supplemental materials that may be packaged together to be sold as course materials for one price.

‘‘college textbook’’ means a textbook or a set of textbooks, used for, or in conjunc- tion with, a course in postsecondary education at an institution of higher education.
(2) COLLEGE TEXTBOOK.—The term (3) COURSE SCHEDULE.—The term ‘‘course schedule’’ means a listing of the courses or classes offered by an institution of higher education for an academic period, as defined by the in- stitution.
(4) CUSTOM TEXTBOOK.—The term ‘‘custom textbook’’— (A) means a college textbook that is compiled by a publisher at the direction of a faculty member or other person or adopting entity in charge of selecting course ma- terials at an institution of higher education; and (B) may include, alone or in combination, items such as selections from original instructor materials, previously copyrighted publisher materials, copyrighted third-party works, and elements unique to a specific institution, such as commemorative editions.
(5) INSTITUTION OF HIGHER EDUCATION.—The term ‘‘institu- tion of higher education’’ has the meaning given the term in section 102.
(6) INTEGRATED TEXTBOOK.—The term ‘‘integrated text- book’’ means a college textbook that is— (A) combined with materials developed by a third party and that, by third-party contractual agreement, may not be offered by publishers separately from the college textbook with which the materials are combined; or (B) combined with other materials that are so inter- related with the content of the college textbook that the separation of the college textbook from the other materials would render the college textbook unusable for its in- tended purpose.
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133 HIGHER EDUCATION ACT OF 1965 50 (7) PUBLISHER.—The term ‘‘publisher’’ means a publisher of college textbooks or supplemental materials involved in or affecting interstate commerce.
(8) SUBSTANTIAL CONTENT.—The term ‘‘substantial con- tent’’ means parts of a college textbook such as new chapters, new material covering additional eras of time, new themes, or new subject matter.

(9) SUPPLEMENTAL MATERIAL.—The term ‘‘supplemental material’’ means educational material developed to accompany a college textbook that— (A) may include printed materials, computer disks, website access, and electronically distributed materials; and (B) is not being used as a component of an integrated textbook.
(c) PUBLISHER REQUIREMENTS.— (1) COLLEGE TEXTBOOK PRICING INFORMATION.—When a publisher provides a faculty member or other person or adopt- ing entity in charge of selecting course materials at an institu- tion of higher education receiving Federal financial assistance with information regarding a college textbook or supplemental material, the publisher shall include, with any such informa- tion and in writing (which may include electronic communica- tions), the following: (A) The price at which the publisher would make the college textbook or supplemental material available to the bookstore on the campus of, or otherwise associated with, such institution of higher education and, if available, the price at which the publisher makes the college textbook or supplemental material available to the public.
(B) The copyright dates of the three previous editions of such college textbook, if any.

(C) A description of the substantial content revisions made between the current edition of the college textbook or supplemental material and the previous edition, if any.
(D)(i) Whether the college textbook or supplemental material is available in any other format, including paper- back and unbound; and (ii) for each other format of the college textbook or supplemental material, the price at which the publisher would make the college textbook or supplemental material in the other format available to the bookstore on the cam- pus of, or otherwise associated with, such institution of higher education and, if available, the price at which the publisher makes such other format of the college textbook or supplemental material available to the public.
(2) UNBUNDLING OF COLLEGE TEXTBOOKS FROM SUPPLE- MENTAL MATERIALS.—A publisher that sells a college textbook and any supplemental material accompanying such college textbook as a single bundle shall also make available the col- lege textbook and each supplemental material as separate and unbundled items, each separately priced.

(3) CUSTOM TEXTBOOKS.—To the maximum extent prac- ticable, a publisher shall provide the information required September 8, 2023 As Amended Through P.L.
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133 under this subsection with respect to the development and pro- vision of custom textbooks.
(d) PROVISION OF ISBN COLLEGE TEXTBOOK INFORMATION IN COURSE SCHEDULES.—To the maximum extent practicable, each in- stitution of higher education receiving Federal financial assistance shall— (1) disclose, on the institution’s Internet course schedule and in a manner of the institution’s choosing, the International Standard Book Number and retail price information of re- quired and recommended college textbooks and supplemental materials for each course listed in the institution’s course schedule used for preregistration and registration purposes, ex- cept that— (A) if the International Standard Book Number is not available for such college textbook or supplemental mate- rial, then the institution shall include in the Internet course schedule the author, title, publisher, and copyright date for such college textbook or supplemental material; and (B) if the institution determines that the disclosure of the information described in this subsection is not prac- ticable for a college textbook or supplemental material, then the institution shall so indicate by placing the des- ignation ‘‘To Be Determined’’ in lieu of the information re- quired under this subsection; and (2) if applicable, include on the institution’s written course schedule a notice that textbook information is available on the institution’s Internet course schedule, and the Internet address for such schedule.
(e) AVAILABILITY OF INFORMATION FOR COLLEGE BOOK- STORES.—An institution of higher education receiving Federal fi- nancial assistance shall make available to a college bookstore that is operated by, or in a contractual relationship or otherwise affili- ated with, the institution, as soon as is practicable upon the re- quest of such college bookstore, the most accurate information available regarding— (1) the institution’s course schedule for the subsequent academic period; and (2) for each course or class offered by the institution for the subsequent academic period— (A) the information required by subsection (d)(1) for each college textbook or supplemental material required or recommended for such course or class; (B) the number of students enrolled in such course or class; and (C) the maximum student enrollment for such course or class.
(f) ADDITIONAL INFORMATION.—An institution disclosing the in- formation required by subsection (d)(1) is encouraged to dissemi- nate to students information regarding— (1) available institutional programs for renting textbooks or for purchasing used textbooks; (2) available institutional guaranteed textbook buy-back programs; September 8, 2023 As Amended Through P.L.
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134 HIGHER EDUCATION ACT OF 1965 52 (3) available institutional alternative content delivery pro- grams; or (4) other available institutional cost-saving strategies.
(g) GAO REPORT.—Not later than July 1, 2013, the Comp- troller General of the United States shall report to the authorizing committees on the implementation of this section by institutions of higher education, college bookstores, and publishers.
The report shall particularly examine— (1) the availability of college textbook information on course schedules; (2) the provision of pricing information to faculty of insti- tutions of higher education by publishers; textbook marketplace, (3) the use of bundled and unbundled material in the col- lege the adoption of unbundled materials by faculty and the use of integrated text- books by publishers; and including (4) the implementation of this section by institutions of higher education, including the costs and benefits to such insti- tutions and to students.
(h) RULE OF CONSTRUCTION.—Nothing in this section shall be construed to supercede the institutional autonomy or academic freedom of instructors involved in the selection of college textbooks, supplemental materials, and other classroom materials.

(i) NO REGULATORY AUTHORITY.—The Secretary shall not pro- mulgate regulations with respect to this section.

SEC.

134. ø20 U.S.C.

1015c¿ DATABASE OF STUDENT INFORMATION PRO- HIBITED.
(a) PROHIBITION.—Except as described in subsection (b), noth- ing in this Act shall be construed to authorize the development, im- plementation, or maintenance of a Federal database of personally identifiable information on individuals receiving assistance under this Act, attending institutions receiving assistance under this Act, or otherwise involved in any studies or other collections of data under this Act, including a student unit record system, an edu- cation bar code system, or any other system that tracks individual students over time.
(b) EXCEPTION.—The provisions of subsection (a) shall not apply to a system (or a successor system) that— (1) is necessary for the operation of programs authorized by title II, IV, or VII; and (2) was in use by the Secretary, directly or through a con- tractor, as of the day before the date of enactment of theHigher Education Opportunity Act.
(c) STATE DATABASES.—Nothing in this Act shall prohibit a State or a consortium of States from developing, implementing, or maintaining State-developed databases that track individuals over time, including student unit record systems that contain informa- tion related to enrollment, attendance, graduation and retention rates, student financial assistance, and graduate employment out- comes.

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135 SEC.

135. ø20 U.S.C.

1015d¿ IN-STATE TUITION RATES FOR MEMBERS OF THE ARMED FORCES ON ACTIVE DUTY, SPOUSES, AND DE- PENDENT CHILDREN 3.
(a) REQUIREMENT.—In the case of a member of the armed forces who is on active duty for a period of more than 30 days and whose domicile or permanent duty station is in a State that re- ceives assistance under this Act, such State shall not charge such member (or the spouse or dependent child of such member) tuition for attendance at a public institution of higher education in the State at a rate that is greater than the rate charged for residents of the State.
(b) CONTINUATION.—If a member of the armed forces (or the spouse or dependent child of a member) pays tuition at a public in- stitution of higher education in a State at a rate determined by subsection (a), the provisions of subsection (a) shall continue to apply to such member, spouse, or dependent while continuously en- rolled at that institution, notwithstanding a subsequent change in the permanent duty station of the member to a location outside the State.
øNote: Section 6206(a)(2) and (3) of division F of Public Law 117– 81 provides for amendments to subsections (a) and (b), respectively, by striking and inserting new text.

Subsection (b) of such section 6206 states as follows: ‘‘The amendments made by subsection (a) shall take effect at each public institution of higher education in a State that receives assistance under the Higher Education Act of 1965 (20 U.S.C.

1001 et seq.)
1001 et seq.)

for the first period of enrollment at such institution that begins after July 1, 2024.’’.
Upon such date, subsections (a) and (b) (as so amended) will read as follows:¿ (a) REQUIREMENT.—In the case of a member of a qualifying Federal service whose domicile or permanent duty station is in a State that receives assistance under this Act, such State shall not charge such member (or the spouse or dependent child of such mem- ber) tuition for attendance at a public institution of higher edu- cation in the State at a rate that is greater than the rate charged for residents of the State.
(b) CONTINUATION.—If a member of a qualifying Federal service (or the spouse or dependent child of a member) pays tuition at a public institution of higher education in a State at a rate deter- mined by subsection (a), the provisions of subsection (a) shall con- tinue to apply to such member, spouse, or dependent while continu- ously enrolled at that institution, notwithstanding a subsequent change in the permanent duty station of the member to a location outside the State.
(c) EFFECTIVE DATE.—This section shall take effect at each public institution of higher education in a State that receives as- 3 Section 6206(a)(1) of division F of Public Law 117–81 provides for an amendment to the sec- tion heading by striking ‘‘THE ARMED FORCES ON ACTIVE DUTY, SPOUSES, AND DE- PENDENT CHILDREN’’ and inserting ‘‘QUALIFYING FEDERAL SERVICE’’.
Subsection (b) of such section 6206 states as follows: ‘‘The amendments made by subsection (a) shall take effect at each public institution of higher education in a State that receives assistance under the High- er Education Act of 1965 (20 U.S.C.

1001 et seq.)

for the first period of enrollment at such insti- tution that begins after July 1, 2024.’’.

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136 HIGHER EDUCATION ACT OF 1965 54 sistance under this Act for the first period of enrollment at such institution that begins after July 1, 2009.
(d) DEFINITIONS.—In this section, the terms ‘‘armed forces’’ and ‘‘active duty for a period of more than 30 days’’ have the meanings given those terms insection 101of title 10, United States Code.

øNote: Section 6206(a)(4) of division F of Public Law 117–81 pro- vides for an amendment to strike subsection (d) and insert a new subsection (d).
Subsection (b) of such section 6206 states as follows: ‘‘The amendments made by subsection (a) shall take effect at each public institution of higher education in a State that receives as- sistance under the Higher Education Act of 1965 (20 U.S.C.

1001 et seq.)

for the first period of enrollment at such institution that begins after July 1, 2024.’’.
Upon such date, subsection (d) is amended to read as follows:¿ (d) DEFINITIONS.—In this section, the term ‘‘member of a quali- fying Federal service’’ means— (1) a member of the armed forces (as defined in section 101 of title 10, United States Code) who is on active duty for a pe- riod of more than 30 days (as defined in section 101 of title 10, United States Code); or (2) a member of the Foreign Service (as defined in section 103 of the Foreign Service Act of 1980 (22 U.S.C.
3903)) who is on active duty for a period of more than 30 days.

SEC.

136. ø20 U.S.C.

1015e¿ STATE HIGHER EDUCATION INFORMATION SYSTEM PILOT PROGRAM.
(a) PURPOSE.—It is the purpose of this section to carry out a pilot program to assist not more than five States to develop State- level postsecondary student data systems to— (1) improve the capacity of States and institutions of high- er education to generate more comprehensive and comparable data, in order to develop better-informed educational policy at the State level and to evaluate the effectiveness of institutional performance while protecting the confidentiality of students’ personally identifiable information; and (2) identify how to best minimize the data-reporting bur- den placed on institutions of higher education, particularly smaller institutions, and to maximize and improve the infor- mation institutions receive from the data systems, in order to assist institutions in improving educational practice and post- secondary outcomes.
(b) DEFINITION OF ELIGIBLE ENTITY.—In this section, the term ‘‘eligible entity’’ means— (1) a State higher education system; or (2) a consortium of State higher education systems, or a consortium of individual institutions of higher education, that is broadly representative of institutions in different sectors and geographic locations.
(c) COMPETITIVE GRANTS.— (1) GRANTS AUTHORIZED.—The Secretary shall award grants, on a competitive basis, to not more than five eligible entities to enable the eligible entities to— September 8, 2023 As Amended Through P.L.

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136 (A) design, test, and implement systems of postsec- ondary student data that provide the maximum benefits to States, institutions of higher education, and State policy- makers; and (B) examine the costs and burdens involved in imple- menting a State-level postsecondary student data system.

(2) DURATION.—A grant awarded under this section shall be for a period of not more than three years.
(d) APPLICATION REQUIREMENTS.—An eligible entity desiring a grant under this section shall submit an application to the Sec- retary at such time, in such manner, and containing such informa- tion as the Secretary may reasonably require, including a descrip- tion of— (1) how the eligible entity will ensure that student privacy is protected and that individually identifiable information about students, the students’ achievements, and the students’ families remains confidential in accordance with section 444 of the General Education Provisions Act (commonly known as the ‘‘Family Educational Rights and Privacy Act of 1974’’) (20 U.S.C.
1232g); and (2) how the activities funded by the grant will be sup- ported after the three-year grant period.
(e) USE OF FUNDS.—A grant awarded under this section shall be used to— (1) design, develop, and implement the components of a comprehensive postsecondary student data system with the ca- pacity to transmit student information within a State; (2) improve the capacity of institutions of higher education to analyze and use student data; (3) select and define common data elements, data quality, and other elements that will enable the data system to— (A) serve the needs of institutions of higher education for institutional research and improvement; (B) provide students and the students’ families with useful information for decision-making about postsec- ondary education; and (C) provide State policymakers with improved infor- mation to monitor and guide efforts to improve student outcomes and success in higher education; (4) estimate costs and burdens at the institutional level for the reporting system for different types of institutions; and (5) test the feasibility of protocols and standards for main- taining data privacy and data access.
(f) EVALUATION; REPORTS.—Not later than six months after the end of the projects funded by grants awarded under this section, the Secretary shall— (1) conduct a comprehensive evaluation of the pilot pro- gram authorized by this section; and (2) report the Secretary’s findings, as well as recommenda- tions regarding the implementation of State-level postsec- ondary student data systems, to the authorizing committees.
(g) AUTHORIZATION OF APPROPRIATIONS.—There are authorized to be appropriated to carry out this section such sums as may be September 8, 2023 As Amended Through P.L.

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137 HIGHER EDUCATION ACT OF 1965 56 necessary for fiscal year 2009 and each of the five succeeding fiscal years.

SEC.

137. ø20 U.S.C.


1015f¿ STATE COMMITMENT TO AFFORDABLE COL- LEGE EDUCATION.
(a) MAINTENANCE OF EFFORT REQUIRED.—A State shall pro- vide— (1) for public institutions of higher education in such State for any academic year beginning on or after July 1, 2008, an amount which is equal to or greater than the average amount provided for non-capital and non-direct research and develop- ment expenses or costs by such State to such institutions of higher education during the five most recent preceding aca- demic years for which satisfactory data are available; and (2) for private institutions of higher education in such State for any academic year beginning on or after July 1, 2008, an amount which is equal to or greater than the average amount provided for student financial aid for paying costs as- sociated with postsecondary education by such State to such institutions during the five most recent preceding academic years for which satisfactory data are available.
(b) ADJUSTMENTS FOR BIENNIAL APPROPRIATIONS.—The Sec- retary shall take into consideration any adjustments to the calcula- tions under subsection (a) that may be required to accurately re- flect funding levels for postsecondary education in States with bien- nial appropriation cycles.
(c) WAIVER.—The Secretary shall waive the requirements of subsection (a), if the Secretary determines that such a waiver would be equitable due to exceptional or uncontrollable cir- cumstances, such as a natural disaster or a precipitous and unforseen decline in the financial resources of a State or State edu- cational agency, as appropriate.
(d) VIOLATION OF MAINTENANCE OF EFFORT.—Notwithstanding any other provision of law, the Secretary shall withhold from any State that violates subsection (a) and does not receive a waiver pursuant to subsection (c) any amount that would otherwise be available to the State under section 781 until such State has made significant efforts to correct such violation.

PART D—ADMINISTRATIVE PROVISIONS FOR DELIVERY OF STUDENT FINANCIAL ASSIST- ANCE SEC.

141. ø20 U.S.C.
141. ø20 U.S.C.

1018¿ PERFORMANCE-BASED ORGANIZATION FOR THE DELIVERY OF FEDERAL STUDENT FINANCIAL ASSIST- ANCE.

(a) ESTABLISHMENT AND PURPOSE.— (1) ESTABLISHMENT.—There is established in the Depart- ment a Performance-Based Organization (hereafter referred to as the ‘‘PBO’’) which shall be a discrete management unit re- sponsible for managing the administrative and oversight func- tions supporting the programs authorized under title IV of this Act, as specified in subsection (b).
(2) PURPOSES.—The purposes of the PBO are— September 8, 2023 As Amended Through P.L.

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141 (A) to improve service to students and other partici- pants in the student financial assistance programs author- ized under title IV, including making those programs more understandable to students and their parents; (B) to reduce the costs of administering those pro- grams; (C) to increase the accountability of the officials re- sponsible for administering the operational aspects of these programs; (D) to provide greater flexibility in the management and administration of the Federal student financial assist- ance programs; (E) to integrate the information systems supporting the Federal student financial assistance programs; (F) to implement an open, common, integrated system for the delivery of student financial assistance under title IV; and (G) to develop and maintain a student financial assist- ance system that contains complete, accurate, and timely data to ensure program integrity.
(b) GENERAL AUTHORITY.— (1) AUTHORITY OF SECRETARY.—Notwithstanding any other provision of this part, the Secretary shall maintain responsi- bility for the development and promulgation of policy and regu- lations relating to the programs of student financial assistance under title IV.

In the exercise of its functions, the PBO shall be subject to the direction of the Secretary.
The Secretary shall— (A) request the advice of, and work in cooperation with, the Chief Operating Officer in developing regula- tions, policies, administrative guidance, or procedures af- fecting the Federal student financial assistance programs authorized under title IV; (B) request cost estimates from the Chief Operating Officer for system changes required by specific policies pro- posed by the Secretary; and (C) assist the Chief Operating Officer in identifying goals for— (i) the administration of the systems used to ad- minister the Federal student financial assistance pro- grams authorized under title IV; and (ii) the updating of such systems to current tech- nology.
(2) PBO FUNCTIONS.—Subject to paragraph (1), the PBO shall be responsible for the administration of Federal student financial assistance programs authorized under title IV, ex- cluding the development of policy relating to such programs but including the following: (A) The administrative, accounting, and financial man- agement functions for the Federal student financial assist- ance programs authorized under title IV, including— (i) the collection, processing, and transmission of data to students, institutions, lenders, State agencies, and other authorized parties; September 8, 2023 As Amended Through P.L.
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141 HIGHER EDUCATION ACT OF 1965 58 (ii) the design and technical specifications for soft- ware development and procurement for systems sup- porting the Federal student financial assistance pro- grams authorized under title IV; (iii) all software and hardware acquisitions and all information technology contracts related to the admin- istration and management of student financial assist- ance under title IV; (iv) all aspects of contracting for the information and financial systems supporting the Federal student financial assistance programs authorized under title IV; (v) providing all customer service, training, and user support related to the administration of the Fed- eral student financial assistance programs authorized under title IV; and (vi) ensuring the integrity of the Federal student financial assistance programs authorized under title IV.
(B) Annual development of a budget for the activities and functions of the PBO, in consultation with the Sec- retary, and for consideration and inclusion in the Depart- ment’s annual budget submission.
(C) Taking action to prevent and address the improper use of access devices, as described in section 485B(d)(7), in- cluding by— (i) detecting common patterns of improper use of any system that processes payments on Federal Direct Loans or other Department information technology systems; (ii) maintaining a reporting system for contractors involved in the processing of payments on Federal Di- rect Loans in order to allow those contractors to alert the Secretary of potentially improper use of Depart- ment information technology systems; (iii) proactively contacting Federal student loan borrowers whose Federal student loan accounts dem- onstrate a likelihood of improper use in order to warn those borrowers of suspicious activity or potential fraud regarding their Federal student loan accounts; and (iv) providing clear and simple disclosures in com- munications with borrowers who are applying for or requesting assistance with Federal Direct Loan pro- grams (including assistance or applications regarding income-driven repayment, forbearance, deferment, con- solidation, rehabilitation, cancellation, and forgive- ness) to ensure that borrowers are aware that the De- partment will never require borrowers to pay for such assistance or applications.
(3) ADDITIONAL FUNCTIONS.—The Secretary may allocate to the PBO such additional functions as the Secretary and the Chief Operating Officer determine are necessary or appropriate to achieve the purposes of the PBO.

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141 (4) INDEPENDENCE.—Subject to paragraph (1), in carrying out its functions, the PBO shall exercise independent control of its budget allocations and expenditures, personnel decisions and processes, procurements, and other administrative and management functions.

(5) AUDITS AND REVIEW.—The PBO shall be subject to the usual and customary Federal audit procedures and to review by the Inspector General of the Department.
(6) CHANGES.— (A) IN GENERAL.—The Secretary and the Chief Oper- ating Officer shall consult concerning the effects of policy, market, or other changes on the ability of the PBO to achieve the goals and objectives established in the per- formance plan described in subsection (c).
(B) REVISIONS TO AGREEMENT.—The Secretary and the Chief Operating Officer may revise the annual perform- ance agreement described in subsection (d)(4) in light of policy, market, or other changes that occur after the Sec- retary and the Chief Operating Officer enter into the agreement.
(c) PERFORMANCE PLAN, REPORT, AND BRIEFING.— (1) PERFORMANCE PLAN.— (A) IN GENERAL.—Each year, the Secretary and Chief Operating Officer shall agree on, and make available to the public, a performance plan for the PBO for the suc- ceeding 5 years that establishes measurable goals and ob- jectives for the organization.
(B) CONSULTATION.—In developing the 5-year perform- ance plan and any revision to the plan, the Secretary and the Chief Operating Officer shall consult with students, in- stitutions of higher education, Congress, lenders, the Advi- sory Committee on Student Financial Assistance, and other interested parties not less than 30 days prior to the implementation of the performance plan or revision.
(C) AREAS.—The plan shall include a concise state- ment of the goals for a modernized system for the delivery of student financial assistance under title IV and identify action steps necessary to achieve such goals.
The plan shall address the PBO’s responsibilities in the following areas: (i) IMPROVING SERVICE.—Improving service to stu- dents and other participants in student financial aid programs authorized under under 4 title IV, including making those programs more understandable to stu- dents and their parents.

(ii) REDUCING COSTS.—Reducing the costs of ad- ministering those programs.

(iii) IMPROVEMENT AND INTEGRATION OF SUPPORT SYSTEMS.—Improving and integrating the systems that support those programs.
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141 HIGHER EDUCATION ACT OF 1965 60 (iv) DELIVERY AND INFORMATION SYSTEM.—Devel- oping open, common, and integrated systems for pro- grams authorized under under 4 title IV.
(v) OTHER AREAS.—Any other areas identified by the Secretary.

(2) ANNUAL REPORT.—Each year, the Chief Operating Officer shall prepare and submit to Congress, through the Sec- retary, an annual report on the performance of the PBO, in- cluding an evaluation of the extent to which the PBO met the goals and objectives contained in the 5-year performance plan described in paragraph (1) for the preceding year.
The annual report shall include the following: (A) An independent financial audit of the expenditures of both the PBO and the programs administered by the PBO.

(B) Financial and performance requirements applica- ble to the PBO under the Chief Financial Officers Act of 1990 and the Government Performance and Results Act of 1993.

(C) The results achieved by the PBO during the year relative to the goals established in the organization’s per- formance plan.
(D) The evaluation rating of the performance of the Chief Operating Officer and senior managers under sub- sections (d)(4) and (e)(2), including the amounts of bonus compensation awarded to these individuals.

(E) Recommendations for legislative and regulatory changes to improve service to students and their families, and to improve program efficiency and integrity.

(F) Other such information as the Director of the Of- fice of Management and Budget shall prescribe for per- formance based organizations.
(3) CONSULTATION WITH STAKEHOLDERS.—The Chief Oper- ating Officer, in preparing the report described in paragraph (2), shall establish appropriate means to consult with students, borrowers, institutions, lenders, guaranty agencies, secondary markets, and others involved in the delivery system of student aid under title IV— (A) regarding the degree of satisfaction with the delivery system; and (B) to seek suggestions on means to improve the delivery system.
(4) BRIEFING ON ENFORCEMENT OF STUDENT LOAN PROVI- SIONS.—The Secretary shall, upon request, provide a briefing to the members of the authorizing committees on the steps the Department has taken to ensure— (A) the integrity of the student loan programs; and (B) that lenders and guaranty agencies are adhering to the requirements of title IV.
(d) CHIEF OPERATING OFFICER.— (1) APPOINTMENT.—The management of the PBO shall be vested in a Chief Operating Officer who shall be appointed by the Secretary to a term of not less than 3 and not more than 5 years, and compensated without regard to chapters 33, 51, September 8, 2023 As Amended Through P.L.
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141 and 53 of title 5, United States Code.

The appointment shall be made on the basis of demonstrated management ability and expertise in information technology, including experience with financial systems, and without regard to political affiliation or activity.
(2) REAPPOINTMENT.—The Secretary may reappoint the Chief Operating Officer to subsequent terms of not less than 3 and not more than 5 years, so long as the performance of the Chief Operating Officer, as set forth in the performance agree- ment described in paragraph (4), is satisfactory.

(3) REMOVAL.—The Chief Operating Officer may be re- moved by— (A) the President; or (B) the Secretary, for misconduct or failure to meet performance goals set forth in the performance agreement in paragraph (4).
The President or Secretary shall communicate the reasons for any such removal to the authorizing committees.

(4) PERFORMANCE AGREEMENT.— (A) IN GENERAL.—Each year, the Secretary and the Chief Operating Officer shall enter into an annual per- formance agreement, that shall set forth measurable orga- nization and individual goals for the Chief Operating Offi- cer.
(B) TRANSMITTAL.—The final agreement, and any revi- sion to the final agreement, shall be transmitted to the au- thorizing committees, and made publicly available.
(5) COMPENSATION.— (A) IN GENERAL.—The Chief Operating Officer is au- thorized to be paid at an annual rate of basic pay not to exceed the maximum rate of basic pay for the Senior Exec- utive Service under section 5382 of title 5, United States Code, including any applicable locality-based comparability section that may be authorized under payment 5304(h)(2)(B) of such title.
The compensation of the Chief Operating Officer shall be considered for purposes of sec- tion 207(c)(2)(A) of title 18, United States Code, to be the equivalent of that described under clause (ii) of section 207(c)(2)(A) of such title.
(B) BONUS.—In addition, the Chief Operating Officer may receive a bonus in an amount that does not exceed 50 percent of such annual rate of basic pay, based upon the Secretary’s evaluation of the Chief Operating Officer’s per- formance in relation to the goals set forth in the perform- ance agreement described in paragraph (4).
(C) PAYMENT.—Payment of a bonus under subpara- graph (B) may be made to the Chief Operating Officer only to the extent that such payment does not cause the Chief Operating Officer’s total aggregate compensation in a cal- endar year to equal or exceed the amount of the Presi- dent’s salary under section 102 of title 3, United States Code.

(e) SENIOR MANAGEMENT.— (1) APPOINTMENT.— September 8, 2023 As Amended Through P.L.
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141 HIGHER EDUCATION ACT OF 1965 62 (A) IN GENERAL.—The Chief Operating Officer may ap- point such senior managers as that officer determines nec- essary without regard to the provisions of title 5, United States Code, governing appointments in the competitive service.
(B) COMPENSATION.—The senior managers described in subparagraph (A) may be paid without regard to the provisions of chapter 51 and subchapter III of chapter 53 of such title relating to classification and General Schedule pay rates.

(2) PERFORMANCE AGREEMENT.—Each year, the Chief Op- erating Officer and each senior manager appointed under this subsection shall enter into an annual performance agreement that sets forth measurable organization and individual goals.
The agreement shall be subject to review and renegotiation at the end of each term.

(3) COMPENSATION.— (A) IN GENERAL.—A senior manager appointed under this subsection may be paid at an annual rate of basic pay of not more than the maximum rate of basic pay for the Senior Executive Service under section 5382 of title 5, United States Code, including any applicable locality-based comparability payment that may be authorized under sec- tion 5304(h)(2)(C) of such title.
The compensation of a sen- ior manager shall be considered for purposes of section 207(c)(2)(A) of title 18, United States Code, to be the equivalent of that described under clause (ii) of section 207(c)(2)(A) of such title.
(B) BONUS.—In addition, a senior manager may re- ceive a bonus in an amount such that the manager’s total annual compensation does not exceed 125 percent of the maximum rate of basic pay for the Senior Executive Serv- ice, including any applicable locality-based comparability payment, based upon the Chief Operating Officer’s evalua- tion of the manager’s performance in relation to the goals set forth in the performance agreement described in para- graph (2).
(4) REMOVAL.—A senior manager shall be removable by the Chief Operating Officer, or by the Secretary if the position of Chief Operating Officer is vacant.

(f) STUDENT LOAN OMBUDSMAN.— (1) APPOINTMENT.—The Chief Operating Officer, in con- sultation with the Secretary, shall appoint a Student Loan Ombudsman to provide timely assistance to borrowers of loans made, insured, or guaranteed under title IV by performing the functions described in paragraph (3).
(2) PUBLIC INFORMATION.—The Chief Operating Officer shall disseminate information about the availability and func- tions of the Ombudsman to students, borrowers, and potential borrowers, as well as institutions of higher education, lenders, guaranty agencies, loan servicers, and other participants in those student loan programs.

(3) FUNCTIONS OF OMBUDSMAN.—The Ombudsman shall— September 8, 2023 As Amended Through P.L.
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142 (A) in accordance with regulations of the Secretary, re- ceive, review, and attempt to resolve informally complaints from borrowers of loans described in paragraph (1), includ- ing, as appropriate, attempts to resolve such complaints within the Department of Education and with institutions of higher education, lenders, guaranty agencies, loan servicers, and other participants in the loan programs de- scribed in paragraph (1); and (B) compile and analyze data on borrower complaints and make appropriate recommendations.
(4) REPORT.—Each year, the Ombudsman shall submit a report to the Chief Operating Officer, for inclusion in the an- nual report under subsection (c)(2), that describes the activi- ties, and evaluates the effectiveness of the Ombudsman during the preceding year.

(g) PERSONNEL FLEXIBILITY.— (1) PERSONNEL CEILINGS.—The PBO shall not be subject to any ceiling relating to the number or grade of employees.
(2) ADMINISTRATIVE FLEXIBILITY.—The Chief Operating Of- ficer shall work with the Office of Personnel Management to develop and implement personnel flexibilities in staffing, clas- sification, and pay that meet the needs of the PBO, subject to compliance with title 5, United States Code.
(3) EXCEPTED SERVICE.—The Chief Operating Officer may appoint, without regard to the provisions of title 5, United States Code, governing appointments in the competitive serv- ice, technical and professional employees to administer the functions of the PBO.

These employees may be paid without re- gard to the provisions of chapter 51 and subchapter III of chap- ter 53 of such title relating to classification and General Sched- ule pay rates.
(h) ESTABLISHMENT OF A FAIR AND EQUITABLE SYSTEM FOR MEASURING STAFF PERFORMANCE.—The PBO shall establish an an- nual performance management system, subject to compliance with title 5, United States Code and consistent with applicable provi- sions of law and regulations, which strengthens the effectiveness of the PBO by providing for establishing goals or objectives for indi- vidual, group, or organizational performance (or any combination thereof), consistent with the performance plan of the PBO and its performance planning procedures, including those established under the Government Performance and Results Act of 1993, and communicating such goals or objectives to employees.
(i) AUTHORIZATION OF APPROPRIATIONS.—The Secretary shall allocate from funds made available under section 458 such funds as are appropriate to the functions assumed by the PBO.

In addi- tion, there are authorized to be appropriated such sums as may be necessary to carry out the purposes of this part.

SEC.

142. ø20 U.S.C.

1018a¿ PROCUREMENT FLEXIBILITY.


(a) PROCUREMENT AUTHORITY.—Subject to the authority of the Secretary, the Chief Operating Officer of a PBO may exercise the authority of the Secretary to procure property and services in the performance of functions managed by the PBO.

For the purposes of this section, the term ‘‘PBO’’ includes the Chief Operating Officer September 8, 2023 As Amended Through P.L.
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142 HIGHER EDUCATION ACT OF 1965 64 of the PBO and any employee of the PBO exercising procurement authority under the preceding sentence.
(b) IN GENERAL.—Except as provided in this section, the PBO shall abide by all applicable Federal procurement laws and regula- tions when procuring property and services.
The PBO shall— (1) enter into contracts to carry out the functions set forth in section 141(b)(2); (2) obtain the services of experts and consultants without regard to section 3109 of title 5, United States Code and set pay in accordance with such section; and (3) through the Chief Operating Officer— (A) to the maximum extent practicable, utilize pro- curement systems that streamline operations, improve in- ternal controls, and enhance management; and (B) assess the efficiency of such systems and assess such systems’ ability to meet PBO requirements.
(c) SERVICE CONTRACTS.— (1) PERFORMANCE-BASED SERVICING CONTRACTS.—The Chief Operating Officer shall, to the extent practicable, maxi- mize the use of performance-based servicing contracts, con- sistent with guidelines for such contracts published by the Of- fice of Federal Procurement Policy, to achieve cost savings and improve service.
(2) FEE FOR SERVICE ARRANGEMENTS.—The Chief Oper- ating Officer shall, when appropriate and consistent with the purposes of the PBO, acquire services related to the functions set forth in section 141(b)(2) from any entity that has the capa- bility and capacity to meet the requirements set by the PBO.
The Chief Operating Officer is authorized to pay fees that are equivalent to those paid by other entities to an organization that provides services that meet the requirements of the PBO, as determined by the Chief Operating Officer.

(d) TWO-PHASE SOURCE-SELECTION PROCEDURES.— (1) IN GENERAL.—The PBO may use a two-phase process for selecting a source for a procurement of property or services.
(2) FIRST PHASE.—The procedures for the first phase of the process for a procurement are as follows: (A) PUBLICATION OF NOTICE.—The contracting officer for the procurement shall publish a notice of the procure- ment in accordance with section 18 of the Office of Federal Procurement Policy Act (41 U.S.C.

416) and subsections (e), (f), and (g) of section 8 of the Small Business Act (15 U.S.C.
637), except that the notice shall include only the following: (i) A general description of the scope or purpose of the procurement that provides sufficient information on the scope or purpose for sources to make informed business decisions regarding whether to participate in the procurement.

(ii) A description of the basis on which potential sources are to be selected to submit offers in the sec- ond phase.

(iii) A description of the information that is to be required under subparagraph (B).
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142 (iv) Any additional information that the con- tracting officer determines appropriate.
(B) INFORMATION SUBMITTED BY OFFERORS.—Each of- feror for the procurement shall submit basic information, such as information on the offeror’s qualifications, the pro- posed conceptual approach, costs likely to be associated with the proposed conceptual approach, and past perform- ance of the offeror, together with any additional informa- tion that is requested by the contracting officer.
(C) SELECTION FOR SECOND PHASE.—The contracting officer shall select the offerors that are to be eligible to participate in the second phase of the process.

The con- tracting officer shall limit the number of the selected offerors to the number of sources that the contracting offi- cer determines is appropriate and in the best interests of the Federal Government.
(3) SECOND PHASE.— (A) IN GENERAL.—The contracting officer shall conduct the second phase of the source selection process in accord- ance with sections 303A and 303B of the Federal Property and Administrative Services Act of 1949 (41 U.S.C.

253a and 253b).

(B) ELIGIBLE PARTICIPANTS.—Only the sources selected in the first phase of the process shall be eligible to partici- pate in the second phase.
(C) SINGLE OR MULTIPLE PROCUREMENTS.—The second phase may include a single procurement or multiple pro- curements within the scope, or for the purpose, described in the notice pursuant to paragraph (2)(A).

(4) PROCEDURES CONSIDERED COMPETITIVE.—The proce- dures used for selecting a source for a procurement under this subsection shall be considered competitive procedures for all purposes.
(e) USE OF SIMPLIFIED PROCEDURES FOR COMMERCIAL PROD- UCTS AND COMMERCIAL SERVICES.—Whenever the PBO anticipates that commercial products or commercial services will be offered for a procurement, the PBO may use (consistent with the special rules for commercial products and commercial services) the special sim- plified procedures for the procurement without regard to any dollar limitation otherwise applicable to the use of those procedures.
(f) FLEXIBLE WAIT PERIODS AND DEADLINES FOR SUBMISSION OF OFFERS OF NONCOMMERCIAL PRODUCTS AND SERVICES.— (1) AUTHORITY.—In carrying out a procurement, the PBO may— (A) apply a shorter waiting period for the issuance of a solicitation after the publication of a notice under section 18 of the Office of Federal Procurement Policy Act (41 U.S.C.
416) than is required under subsection (a)(3)(A) of such section; and (B) notwithstanding subsection (a)(3) of such section, establish any deadline for the submission of bids or pro- posals that affords potential offerors a reasonable oppor- tunity to respond to the solicitation.

September 8, 2023 As Amended Through P.L.


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142 HIGHER EDUCATION ACT OF 1965 66 (2) INAPPLICABILITY TO COMMERCIAL PRODUCTS AND SERV- ICES.—Paragraph (1) does not apply to a procurement of a com- mercial product or a commercial service.
(3) CONSISTENCY WITH APPLICABLE INTERNATIONAL AGREE- MENTS.—If an international agreement is applicable to the pro- curement, any exercise of authority under paragraph (1) shall be consistent with the international agreement.

(g) MODULAR CONTRACTING.— (1) IN GENERAL.—The PBO may satisfy the requirements of the PBO for a system incrementally by carrying out succes- sive procurements of modules of the system.
In doing so, the PBO may use procedures authorized under this subsection to procure any such module after the first module.

(2) UTILITY REQUIREMENT.—A module may not be procured for a system under this subsection unless the module is useful independently of the other modules or useful in combination with another module previously procured for the system.
(3) CONDITIONS FOR USE OF AUTHORITY.—The PBO may use procedures authorized under paragraph (4) for the procure- ment of an additional module for a system if— (A) competitive procedures were used for awarding the contract for the procurement of the first module for the system; and (B) the solicitation for the first module included— (i) a general description of the entire system that was sufficient to provide potential offerors with rea- sonable notice of the general scope of future modules; for potential information sufficient offerors to make informed business judgments regard- ing whether to submit offers for the contract for the first module; and (ii) other (iii) a statement that procedures authorized under this subsection could be used for awarding subsequent contracts for the procurement of additional modules for the system.
(4) PROCEDURES.—If the procurement of the first module for a system meets the requirements set forth in paragraph (3), the PBO may award a contract for the procurement of an addi- tional module for the system using any of the following proce- dures: (A) SINGLE-SOURCE BASIS.—Award of the contract on a single-source basis to a contractor who was awarded a con- tract for a module previously procured for the system under competitive procedures or procedures authorized under subparagraph (B).
(B) ADEQUATE COMPETITION.—Award of the contract on the basis of offers made by— (i) a contractor who was awarded a contract for a module previously procured for the system after hav- ing been selected for award of the contract under this subparagraph or other competitive procedures; and (ii) at least one other offeror that submitted an offer for a module previously procured for the system and is expected, on the basis of the offer for the pre- September 8, 2023 As Amended Through P.L.
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142 viously procured module, to submit a competitive offer for the additional module.

(C) OTHER.—Award of the contract under any other procedure authorized by law.
(5) NOTICE REQUIREMENT.— (A) PUBLICATION.—Not less than 30 days before issuing a solicitation for offers for a contract for a module for a system under procedures authorized under subpara- graph (A) or (B) of paragraph (4), the PBO shall publish in the Commerce Business Daily a notice of the intent to use such procedures to enter into the contract.
(B) EXCEPTION.—Publication of a notice is not required under this paragraph with respect to a use of procedures authorized under paragraph (4) if the contractor referred to in that subparagraph (who is to be solicited to submit an offer) has previously provided a module for the system under a contract that contained cost, schedule, and per- formance goals and the contractor met those goals.
(C) CONTENT OF NOTICE.—A notice published under subparagraph (A) with respect to a use of procedures de- scribed in paragraph (4) shall contain the information re- quired under section 18(b) of the Office of Federal Procure- ment Policy Act (41 U.S.C.
416(b)), other than paragraph (4) of such section, and shall invite the submission of any assertion that the use of the procedures for the procure- ment involved is not in the best interest of the Federal Government together with information supporting the as- sertion.

(6) DOCUMENTATION.—The basis for an award of a contract under this subsection shall be documented.

However, a jus- tification pursuant to section 303(f) of the Federal Property and Administrative Services Act of 1949 (41 U.S.C.
253(f)) or section 8(h) of the Small Business Act (15 U.S.C.

637(h)) is not required.

(7) SIMPLIFIED SOURCE-SELECTION PROCEDURES.—The PBO may award a contract under any other simplified procedures prescribed by the PBO for the selection of sources for the pro- curement of modules for a system, after the first module, that are not to be procured under a contract awarded on a single- source basis.
(h) USE OF SIMPLIFIED PROCEDURES FOR SMALL BUSINESS SET- ASIDES FOR SERVICES OTHER THAN COMMERCIAL SERVICES.— (1) AUTHORITY.—The PBO may use special simplified pro- cedures for a procurement of services that are not commercial services if— (A) the procurement is in an amount not greater than $1,000,000; (B) the procurement is conducted as a small business set-aside pursuant to section 15(a) of the Small Business Act (15 U.S.C.
644(a)); and (C) the price charged for supplies associated with the services procured are items of supply expected to be less than 20 percent of the total contract price.

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142 HIGHER EDUCATION ACT OF 1965 68 (2) INAPPLICABILITY TO CERTAIN PROCUREMENTS.—The au- thority set forth in paragraph (1) may not be used for— (A) an award of a contract on a single-source basis; or (B) a contract for construction.

(i) GUIDANCE FOR USE OF AUTHORITY.— (1) ISSUANCE BY PBO.—The Chief Operating Officer of the PBO, in consultation with the Administrator for Federal Pro- curement Policy, shall issue guidance for the use by PBO per- sonnel of the authority provided in this section.
(2) GUIDANCE FROM OFPP.—As part of the consultation re- quired under paragraph (1), the Administrator for Federal Pro- curement Policy shall provide the PBO with guidance that is designed to ensure, to the maximum extent practicable, that the authority under this section is exercised by the PBO in a manner that is consistent with the exercise of the authority by the heads of the other performance-based organizations.
(3) COMPLIANCE WITH OFPP GUIDANCE.—The head of the PBO shall ensure that the procurements of the PBO under this section are carried out in a manner that is consistent with the guidance provided for the PBO under paragraph (2).
(j) LIMITATION ON MULTIAGENCY CONTRACTING.—No depart- ment or agency of the Federal Government may purchase property or services under contracts entered into or administered by a PBO under this section unless the purchase is approved in advance by the senior procurement official of that department or agency who is responsible for purchasing by the department or agency.
(k) LAWS NOT AFFECTED.—Nothing in this section shall be con- strued to waive laws for the enforcement of civil rights or for the establishment and enforcement of labor standards that are applica- ble to contracts of the Federal Government.

(l) DEFINITIONS.—In this section: (1) COMMERCIAL PRODUCT.—The term ‘‘commercial prod- uct’’ has the meaning given the term in section 103 of title 41, United States Code.
(2) COMMERCIAL SERVICE.—The term ‘‘commercial service’’ has the meaning given the term in section 103a of title 41, United States Code.

(3) COMPETITIVE PROCEDURES.—The term ‘‘competitive pro- cedures’’ has the meaning given the term in section 152 of title 41, United States Code.
(4) SINGLE-SOURCE BASIS.—The term ‘‘single-source basis’’, with respect to an award of a contract, means that the contract is awarded to a source after soliciting an offer or offers from, and negotiating with, only such source (although such source is not the only source in the marketplace capable of meeting the need) because such source is the most advantageous source for purposes of the award.
(5) SPECIAL RULES FOR COMMERCIAL PRODUCTS AND COM- MERCIAL SERVICES.—The term ‘‘special rules for commercial products and commercial services’’ means the regulations set forth in the Federal Acquisition Regulation pursuant to sec- tions 1901 and 3305(a) of title 41, United States Code.

(6) SPECIAL SIMPLIFIED PROCEDURES.—The term ‘‘special simplified procedures’’ means the procedures applicable to pur- September 8, 2023 As Amended Through P.L.
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143 chases of property and services for amounts not greater than the simplified acquisition threshold that are set forth in the Federal Acquisition Regulation pursuant to sections 1901(a)(1) and 3305(a)(1) of title 41, United States Code.

SEC.

143. ø20 U.S.C.


1018b¿ ADMINISTRATIVE SIMPLIFICATION OF STU- DENT AID DELIVERY.

(a) IN GENERAL.—In order to improve the efficiency and effec- tiveness of the student aid delivery system, the Secretary and the Chief Operating Officer shall encourage and participate in the es- tablishment of voluntary consensus standards and requirements for the electronic transmission of information necessary for the admin- istration of programs under title IV.
(b) PARTICIPATION IN STANDARD SETTING ORGANIZATIONS.— (1) The Chief Operating Officer shall participate in the ac- tivities of standard setting organizations in carrying out the provisions of this section.

(2) The Chief Operating Officer shall encourage higher education groups seeking to develop common forms, standards, and procedures in support of the delivery of Federal student fi- nancial assistance to conduct these activities within a standard setting organization.
(3) The Chief Operating Officer may pay necessary dues and fees associated with participating in standard setting orga- nizations pursuant to this subsection.
(c) ADOPTION OF VOLUNTARY CONSENSUS STANDARDS.—Except with respect to the common financial reporting form under section 483(a), the Secretary shall consider adopting voluntary consensus standards agreed to by the organization described in subsection (b) for transactions required under title IV, and common data elements for such transactions, to enable information to be exchanged elec- tronically between systems administered by the Department and among participants in the Federal student aid delivery system.
(d) USE OF CLEARINGHOUSES.—Nothing in this section shall re- strict the ability of participating institutions and lenders from using a clearinghouse or servicer to comply with the standards for the exchange of information established under this section.
(e) DATA SECURITY.—Any entity that maintains or transmits information under a transaction covered by this section shall main- tain reasonable and appropriate administrative, technical, and physical safeguards— (1) to ensure the integrity and confidentiality of the infor- mation; and (2) to protect against any reasonably anticipated security threats, or unauthorized uses or disclosures of the information.
(f) DEFINITIONS.— (1) CLEARINGHOUSE.—The term ‘‘clearinghouse’’ means a public or private entity that processes or facilitates the proc- essing of nonstandard data elements into data elements con- forming to standards adopted under this section.

(2) STANDARD SETTING ORGANIZATION.—The term ‘‘stand- ard setting organization’’ means an organization that— (A) is accredited by the American National Standards Institute; September 8, 2023 As Amended Through P.L.
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151 HIGHER EDUCATION ACT OF 1965 70 (B) develops standards for information transactions, data elements, or any other standard that is necessary to, or will facilitate, the implementation of this section; and (C) is open to the participation of the various entities engaged in the delivery of Federal student financial assist- ance.

(3) VOLUNTARY CONSENSUS STANDARD.—The term ‘‘vol- untary consensus standard’’ means a standard developed or used by a standard setting organization described in paragraph (2).
PART E—LENDER AND INSTITUTION REQUIRE- MENTS RELATING TO EDUCATION LOANS SEC.

151. ø20 U.S.C.

1019¿ DEFINITIONS.

In this part: (1) AGENT.—The term ‘‘agent’’ means an officer or em- ployee of a covered institution or an institution-affiliated orga- nization.

(2) COVERED INSTITUTION.—The term ‘‘covered institution’’ means any institution of higher education, as such term is de- fined in section 102, that receives any Federal funding or as- sistance.
(3) EDUCATION LOAN.—The term ‘‘education loan’’ (except when used as part of the term ‘‘private education loan’’) means— (A) any loan made, insured, or guaranteed under part B of title IV; (B) any loan made under part D of title IV; or (C) a private education loan.

(4) ELIGIBLE LENDER.—The term ‘‘eligible lender’’ has the meaning given such term in section 435(d).
(5) INSTITUTION-AFFILIATED ORGANIZATION.—The term ‘‘in- stitution-affiliated organization’’— (A) means any organization that— (i) is directly or indirectly related to a covered in- stitution; and (ii) is engaged in the practice of recommending, promoting, or endorsing education loans for students attending such covered institution or the families of such students; (B) may include an alumni organization, athletic orga- nization, foundation, or social, academic, or professional organization, of a covered institution; and (C) notwithstanding subparagraphs (A) and (B), does not include any lender with respect to any education loan secured, made, or extended by such lender.
(6) LENDER.—The term ‘‘lender’’ (except when used as part of the terms ‘‘eligible lender’’ and ‘‘private educational lend- er’’)— (A) means— (i) in the case of a loan made, insured, or guaran- teed under part B of title IV, an eligible lender; September 8, 2023 As Amended Through P.L.
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152 (ii) in the case of any loan issued or provided to a student under part D of title IV, the Secretary; and (iii) in the case of a private education loan, a pri- vate educational lender as defined in section 140 of the Truth in Lending Act; and (B) includes any other person engaged in the business of securing, making, or extending education loans on be- half of the lender.
(7) OFFICER.—The term ‘‘officer’’ includes a director or trustee of a covered institution or institution-affiliated organi- zation, if such individual is treated as an employee of such cov- ered institution or institution-affiliated organization, respec- tively.
(8) PREFERRED LENDER ARRANGEMENT.—The term ‘‘pre- ferred lender arrangement’’— (A) means an arrangement or agreement between a lender and a covered institution or an institution-affiliated organization of such covered institution— (i) under which a lender provides or otherwise issues education loans to the students attending such covered institution or the families of such students; and (ii) that relates to such covered institution or such institution-affiliated organization recommending, pro- moting, or endorsing the education loan products of the lender; and (B) does not include— (i) arrangements or agreements with respect to loans under part D of title IV; or (ii) arrangements or agreements with respect to loans that originate through the auction pilot program under section 499(b).
(9) PRIVATE EDUCATION LOAN.—The term ‘‘private edu- cation loan’’ has the meaning given the term in section 140 of the Truth in Lending Act.

SEC.

152. ø20 U.S.C.

1019a¿ RESPONSIBILITIES OF COVERED INSTITU- TIONS, INSTITUTION-AFFILIATED ORGANIZATIONS, AND LENDERS.
(a) RESPONSIBILITIES OF COVERED INSTITUTIONS AND INSTITU- TION-AFFILIATED ORGANIZATIONS.— (1) DISCLOSURES BY COVERED INSTITUTIONS AND INSTITU- TION-AFFILIATED ORGANIZATIONS.— (A) PREFERRED LENDER ARRANGEMENT DISCLOSURES.— In addition to the disclosures required by subsections (a)(27) and (h) of section 487 (if applicable), a covered in- stitution, or an institution-affiliated organization of such covered institution, that participates in a preferred lender arrangement shall disclose— (i) on such covered institution’s or institution-af- filiated organization’s website and in all informational materials described in subparagraph (C) that describe or discuss education loans— September 8, 2023 As Amended Through P.L.
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152 HIGHER EDUCATION ACT OF 1965 72 (I) the maximum amount of Federal grant and loan aid under title IV available to students, in an easy to understand format; (II) the information required to be disclosed pursuant to section 153(a)(2)(A)(i), for each type of loan described in section 151(3)(A) that is offered pursuant to a preferred lender arrangement of the institution or organization to students of the insti- tution or the families of such students; and (III) a statement that such institution is re- quired to process the documents required to ob- tain a loan under part B of title IV from any eligi- ble lender the student selects; and (ii) on such covered institution’s or institution-af- filiated organization’s website and in all informational materials described in subparagraph (C) that describe or discuss private education loans— (I) in the case of a covered institution, the in- formation that the Board of Governors of the Fed- eral Reserve System requires to be disclosed under section 128(e)(11) of the Truth in Lending Act (15 U.S.C.
1638(e)(11)), for each type of pri- vate education loan offered pursuant to a pre- ferred lender arrangement of the institution to students of the institution or the families of such students; and (II) in the case of an institution-affiliated or- ganization of a covered institution, the informa- tion the Board of Governors of the Federal Re- serve System requires to be disclosed under sec- tion 128(e)(1) of the Truth in Lending Act (15 U.S.C.
1638(e)(1)), for each type of private edu- cation loan offered pursuant to a preferred lender arrangement of the organization to students of such institution or the families of such students.
(B) PRIVATE EDUCATION LOAN DISCLOSURES.—A cov- ered institution, or an institution-affiliated organization of such covered institution, that provides information regard- ing a private education loan from a lender to a prospective borrower shall— (i) provide the prospective borrower with the infor- mation the Board of Governors of the Federal Reserve System requires to be disclosed under section 128(e)(1) of the Truth in Lending Act (15 U.S.C.
1638(e)(1)) for such loan; (ii) inform the prospective borrower that— (I) the prospective borrower may qualify for loans or other assistance under title IV; and (II) the terms and conditions of loans made, insured, or guaranteed under title IV may be more favorable than the provisions of private edu- cation loans; and (iii) ensure that information regarding private education loans is presented in such a manner as to September 8, 2023 As Amended Through P.L.
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152 be distinct from information regarding loans that are made, insured, or guaranteed under title IV.
(C) INFORMATIONAL MATERIALS.—The informational materials described in this subparagraph are publications, mailings, or electronic messages or materials that— (i) are distributed to prospective or current stu- dents of a covered institution and families of such stu- dents; and (ii) describe or discuss the financial aid opportuni- ties available to students at an institution of higher education.
(2) USE OF INSTITUTION NAME.—A covered institution, or an institution-affiliated organization of such covered institu- tion, that enters into a preferred lender arrangement with a lender regarding private education loans shall not agree to the lender’s use of the name, emblem, mascot, or logo of such insti- tution or organization, or other words, pictures, or symbols readily identified with such institution or organization, in the marketing of private education loans to students attending such institution in any way that implies that the loan is of- fered or made by such institution or organization instead of the lender.
(3) USE OF LENDER NAME.—A covered institution, or an in- stitution-affiliated organization of such covered institution, that enters into a preferred lender arrangement with a lender regarding private education loans shall ensure that the name of the lender is displayed in all information and documentation related to such loans.
(b) LENDER RESPONSIBILITIES.— (1) DISCLOSURES BY LENDERS.— (A) DISCLOSURES TO BORROWERS.— (i) FEDERAL EDUCATION LOANS.—For each edu- cation loan that is made, insured, or guaranteed under part B or D of title IV (other than a loan made under section 428C or a Federal Direct Consolidation Loan), at or prior to the time the lender disburses such loan, the lender shall provide the prospective borrower or borrower, in writing (including through electronic means), with the disclosures described in subsections (a) and (c) of section 433.
(ii) PRIVATE EDUCATION LOANS.—For each of a lender’s private education loans, the lender shall com- ply with the disclosure requirements under section 128(e) of the Truth in Lending Act (15 U.S.C.

1638(e)).
1638(e)).

(B) DISCLOSURES TO THE SECRETARY.— (i) IN GENERAL.—Each lender of a loan made, in- sured, or guaranteed under part B of title IV shall, on an annual basis, report to the Secretary— (I) any reasonable expenses paid or provided under section 435(d)(5)(D) or paragraph (3)(B) or (7) of section 487(e) to any agent of a covered in- stitution who— (aa) is employed in the financial aid office of a covered institution; or September 8, 2023 As Amended Through P.L.
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153 HIGHER EDUCATION ACT OF 1965 74 (bb) otherwise has responsibilities with respect to education loans or other financial aid of the institution; and (II) any similar expenses paid or provided to any agent of an institution-affiliated organization who is involved in the practice of recommending, promoting, or endorsing education loans.
(ii) CONTENTS OF REPORTS.—Each report described in clause (i) shall include— (I) the amount for each specific instance in which the lender provided such expenses; (II) the name of any agent described in clause (i) to whom the expenses were paid or provided; (III) the dates of the activity for which the ex- penses were paid or provided; and (IV) a brief description of the activity for which the expenses were paid or provided.
(iii) REPORT TO CONGRESS.—The Secretary shall summarize the information received from the lenders under this subparagraph in a report and transmit such report annually to the authorizing committees.
(2) CERTIFICATION BY LENDERS.—Not later than 18 months after the date of enactment of theHigher Education Oppor- tunity Act— (A) in addition to any other disclosure required under Federal law, each lender of a loan made, insured, or guar- anteed under part B of title IV that participates in one or more preferred lender arrangements shall annually certify the lender’s compliance with the requirements of this Act; and (B) if an audit of a lender is required pursuant to sec- tion 428(b)(1)(U)(iii), the lender’s compliance with the re- quirements under this section shall be reported on and at- tested to annually by the auditor of such lender.
SEC.

153. ø20 U.S.C.

1019b¿ LOAN INFORMATION TO BE DISCLOSED AND MODEL DISCLOSURE FORM FOR COVERED INSTITUTIONS, INSTITUTION-AFFILIATED ORGANIZATIONS, AND LEND- ERS PARTICIPATING IN PREFERRED LENDER ARRANGE- MENTS.
(a) DUTIES OF THE SECRETARY.— (1) DETERMINATION OF MINIMUM DISCLOSURES.— (A) IN GENERAL.—Not later than 18 months after the date of enactment of theHigher Education Opportunity Act, the Secretary, in coordination with the Board of Gov- ernors of the Federal Reserve System, shall determine the minimum information that lenders, covered institutions, and institution-affiliated organizations of such covered in- stitutions participating in preferred lender arrangements shall make available regarding education loans described in section 151(3)(A) that are offered to students and the families of such students.
(B) CONSULTATION AND CONTENT OF MINIMUM DISCLO- SURES.—In carrying out subparagraph (A), the Secretary shall— September 8, 2023 As Amended Through P.L.

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153 (i) consult with students, the families of such stu- dents, representatives of covered institutions (includ- ing financial aid administrators, admission officers, and business officers), representatives of institution-af- filiated organizations, secondary school guidance coun- selors, lenders, loan servicers, and guaranty agencies; (ii) include, in the minimum information under subparagraph (A) that is required to be made avail- able, the information that the Board of Governors of the Federal Reserve System requires to be disclosed under section 128(e)(1) of the Truth in Lending Act (15 U.S.C.
1638(e)(1)), modified as necessary to apply to such loans; and (iii) consider the merits of requiring each covered institution, and each institution-affiliated organization of such covered institution, with a preferred lender ar- rangement to provide to prospective borrowers and the families of such borrowers the following information for each type of education loan offered pursuant to such preferred lender arrangement: (I) The interest rate and terms and conditions of the loan for the next award year, including loan forgiveness and deferment.
(II) Information on any charges, such as origi- nation and Federal default fees, that are payable on the loan, and whether those charges will be— (aa) collected by the lender at or prior to the disbursal of the loan, including whether the charges will be deducted from the pro- ceeds of the loan or paid separately by the borrower; or (bb) paid in whole or in part by the lend- er.

(III) The annual and aggregate maximum amounts that may be borrowed.
(IV) The average amount borrowed from the lender by students who graduated from such insti- tution in the preceding year with certificates, un- dergraduate degrees, graduate degrees, and pro- fessional degrees, as applicable, and who obtained loans of such type from the lender for the pre- ceding year.
(V) The amount the borrower may pay in in- terest, based on a standard repayment plan and the average amount borrowed from the lender by students who graduated from such institution in the preceding year and who obtained loans of such type from the lender for the preceding year, for— (aa) borrowers of loans made under sec- tion 428; (bb) borrowers of loans made under sec- tion 428B or 428H, who pay the interest while in school; and September 8, 2023 As Amended Through P.L.
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153 HIGHER EDUCATION ACT OF 1965 76 (cc) borrowers of loans made under sec- tion 428B or 428H, who do not pay the inter- est while in school.

(VI) The consequences for the borrower of de- faulting on a loan, including limitations on the discharge of an education loan in bankruptcy.
(VII) Contact information for the lender.

(VIII) Other information suggested by the per- sons and entities with whom the Secretary has consulted under clause (i).
(2) REQUIRED DISCLOSURES.—After making the determina- tions under paragraph (1), the Secretary, in coordination with the Board of Governors of the Federal Reserve System and after consultation with the public, shall— (A)(i) provide that the information determined under paragraph (1) shall be disclosed by covered institutions, and institution-affiliated organizations of such covered in- stitutions, with preferred lender arrangements to prospec- tive borrowers and the families of such borrowers regard- ing the education loans described in section 151(3)(A) that are offered pursuant to such preferred lender arrange- ments; and (ii) make clear that such covered institutions and in- stitution-affiliated organizations may provide the required information on a form designed by the institution or orga- nization instead of the model disclosure form described in subparagraph (B); (B) develop a model disclosure form that may be used by covered institutions, institution-affiliated organizations, and preferred lenders that includes all of the information required under subparagraph (A)(i) in a format that— (i) is easily usable by students, families, institu- tions, institution-affiliated organizations, lenders, loan servicers, and guaranty agencies; and (ii) is similar in format to the form developed by the Board of Governors of the Federal Reserve System under paragraphs (1) and (5)(A) of section 128(e), in order to permit students and the families of students to easily compare private education loans and edu- cation loans described in section 151(3)(A); and (C) update such model disclosure form periodically, as necessary.
(b) DUTIES OF LENDERS.—Each lender that has a preferred lender arrangement with a covered institution, or an institution-af- filiated organization of such covered institution, with respect to education loans described in section 151(3)(A) shall annually, by a date determined by the Secretary, provide to such covered institu- tion or such institution-affiliated organization, and to the Sec- retary, the information the Secretary requires pursuant to sub- section (a)(2)(A)(i) for each type of education loan described in sec- tion 151(3)(A) that the lender plans to offer pursuant to such pre- ferred lender arrangement to students attending such covered in- stitution, or to the families of such students, for the next award year.
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153 (c) DUTIES OF COVERED INSTITUTIONS AND INSTITUTION-AFFILI- ATED ORGANIZATIONS.— (1) PROVIDING INFORMATION TO STUDENTS AND FAMILIES.— (A) IN GENERAL.—Each covered institution, and each institution-affiliated organization of such covered institu- tion, that has a preferred lender arrangement shall pro- vide the following information to students attending such institution, or the families of such students, as applicable: (i) The information the Secretary requires pursu- ant to subsection (a)(2)(A)(i), for each type of education loan described in section 151(3)(A) offered pursuant to a preferred lender arrangement to students of such in- stitution or the families of such students.
(ii)(I) In the case of a covered institution, the in- formation that the Board of Governors of the Federal Reserve System requires to be disclosed under section 128(e)(11) of the Truth in Lending Act (15 U.S.C.

1638(e)(11)) to the covered institution, for each type of private education loan offered pursuant to such pre- ferred lender arrangement to students of such institu- tion or the families of such students.
(II) In the case of an institution-affiliated organi- zation, the information the Board of Governors of the Federal Reserve System requires to be disclosed under section 128(e)(1) of the Truth in Lending Act (15 U.S.C.

1638(e)(1)), for each type of private education loan offered pursuant to such preferred lender ar- rangement to students of the institution with which such organization is affiliated or the families of such students.
(B) TIMELY PROVISION OF INFORMATION.—The informa- tion described in subparagraph (A) shall be provided in a manner that allows for the students or the families to take such information into account before selecting a lender or applying for an education loan.
(2) ANNUAL REPORT.—Each covered institution, and each institution-affiliated organization of such covered institution, that has a preferred lender arrangement, shall— (A) prepare and submit to the Secretary an annual re- port, by a date determined by the Secretary, that includes, for each lender that has a preferred lender arrangement with such covered institution or organization— (i) the information described in clauses (i) and (ii) of paragraph (1)(A); and (ii) a detailed explanation of why such covered in- stitution or institution-affiliated organization entered into a preferred lender arrangement with the lender, including why the terms, conditions, and provisions of each type of education loan provided pursuant to the preferred lender arrangement are beneficial for stu- dents attending such institution, or the families of such students, as applicable; and (B) ensure that the report required under subpara- graph (A) is made available to the public and provided to September 8, 2023 As Amended Through P.L.
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154 HIGHER EDUCATION ACT OF 1965 78 students attending or planning to attend such covered in- stitution and the families of such students.
(3) CODE OF CONDUCT.— (A) IN GENERAL.—Each covered institution, and each institution-affiliated organization of such covered institu- tion, that has a preferred lender arrangement, shall com- ply with the code of conduct requirements of subpara- graphs (A) through (C) of section 487(a)(25).
(B) APPLICABLE CODE OF CONDUCT.—For purposes of subparagraph (A), an institution-affiliated organization of a covered institution shall— (i) comply with the code of conduct developed and published by such covered institution under subpara- graphs (A) and (B) of section 487(a)(25); (ii) if such institution-affiliated organization has a website, publish such code of conduct prominently on the website; and (iii) administer and enforce such code of conduct by, at a minimum, requiring that all of such organiza- tion’s agents with responsibilities with respect to edu- cation loans be annually informed of the provisions of such code of conduct.
SEC.

154. ø20 U.S.C.

1019c¿ LOAN INFORMATION TO BE DISCLOSED AND MODEL DISCLOSURE FORM FOR INSTITUTIONS PARTICI- PATING IN THE WILLIAM.

D. FORD FEDERAL DIRECT LOAN PROGRAM.
(a) PROVISION OF DISCLOSURES TO INSTITUTIONS BY THE SEC- RETARY.—Not later than 180 days after the development of the model disclosure form under section 153(a)(2)(B), the Secretary shall provide each institution of higher education participating in the William D. Ford Direct Loan Program under part D of title IV with a completed model disclosure form including the same infor- mation for Federal Direct Stafford Loans, Federal Direct Unsub- sidized Stafford Loans, and Federal Direct PLUS loans made to, or on behalf of, students attending each such institution as is required on such form for loans described in section 151(3)(A).
(b) DUTIES OF INSTITUTIONS.— (1) IN GENERAL.—Each institution of higher education par- ticipating in the William D. Ford Direct Loan Program under part D of title IV shall— (A) make the information the Secretary provides to the institution under subsection (a) available to students at- tending or planning to attend the institution, or the fami- lies of such students, as applicable; and (B) if the institution provides information regarding a private education loan to a prospective borrower, concur- rently provide such borrower with the information the Sec- retary provides to the institution under subsection (a).
(2) CHOICE OF FORMS.—In providing the information re- quired under paragraph (1), an institution of higher education may use a comparable form designed by the institution instead of the model disclosure form developed under section 153(a)(2)(B).

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200 SEC.

155. ø20 U.S.C.

1019d¿ SELF-CERTIFICATION FORM FOR PRIVATE EDUCATION LOANS.
(a) IN GENERAL.—The Secretary, in consultation with the Board of Governors of the Federal Reserve System, shall develop the self-certification form for private education loans that shall be used to satisfy the requirements of section 128(e)(3) of the Truth in Lending Act.
Such form shall— (1) be developed in a standardized format; (2) be made available to the applicant by the relevant in- stitution of higher education, in written or electronic form, upon request of the applicant; (3) contain only disclosures that— (A) the applicant may qualify for Federal student fi- nancial assistance through a program under title IV of this Act, or State or institutional student financial assistance, in place of, or in addition to, a private education loan; (B) the applicant is encouraged to discuss the avail- ability of Federal, State, and institutional student finan- cial assistance with financial aid officials at the applicant’s institution of higher education; (C) a private education loan may affect the applicant’s eligibility for free or low-cost Federal, State or institutional student financial assistance; and (D) the information that the applicant is required to provide on the form is available from officials at the finan- cial aid office of the institution of higher education; (4) include a place to provide information on— (A) the applicant’s cost of attendance at the institution of higher education, as determined by the institution under part F of title IV; (B) the applicant’s estimated financial assistance, in- cluding amounts of financial assistance used to replace the expected family contribution 1, as determined by the insti- tution, in accordance with title IV, for students who have completed the Free Application for Federal Student Aid; and (C) the difference between the amounts under sub- paragraphs (A) and (B), as applicable; and (5) include a place for the applicant’s signature, in written or electronic form.
(b) LIMIT ON LIABILITY.—Nothing in this section shall be con- strued to create a private right of action against an institution of higher education with respect to the form developed under sub- section (a).

TITLE II—TEACHER QUALITY ENHANCEMENT SEC.

200. ø20 U.S.C.

1021¿ DEFINITIONS.

In this title: (1) ARTS AND SCIENCES.—The term ‘‘arts and sciences’’ means— September 8, 2023 As Amended Through P.L.
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200 HIGHER EDUCATION ACT OF 1965 80 (A) when referring to an organizational unit of an in- stitution of higher education, any academic unit that offers one or more academic majors in disciplines or content areas corresponding to the academic subject matter areas in which teachers provide instruction; and (B) when referring to a specific academic subject area, the disciplines or content areas in which academic majors are offered by the arts and sciences organizational unit.
(2) CHILDREN FROM LOW-INCOME FAMILIES.—The term ‘‘children from low-income families’’ means children described in section 1124(c)(1)(A) of the Elementary and Secondary Edu- cation Act of 1965.

(3) CORE ACADEMIC SUBJECTS.—The term ‘‘core academic subjects’’ means English, reading or language arts, mathe- matics, science, foreign languages, civics and government, eco- nomics, arts, history, and geography.
(4) EARLY CHILDHOOD EDUCATOR.—The term ‘‘early child- hood educator’’ means an individual with primary responsi- bility for the education of children in an early childhood edu- cation program.

(5) EDUCATIONAL SERVICE AGENCY.—The term ‘‘educational service agency’’ has the meaning given the term in section 8101 of the Elementary and Secondary Education Act of 1965.
(6) ELIGIBLE PARTNERSHIP.—Except as otherwise provided in section 251, the term ‘‘eligible partnership’’ means an entity that— (A) shall include— (i) a high-need local educational agency; (ii)(I) a high-need school or a consortium of high- need schools served by the high-need local educational agency; or (II) as applicable, a high-need early childhood edu- cation program; (iii) a partner institution; (iv) a school, department, or program of education within such partner institution, which may include an existing teacher professional development program with proven outcomes within a four-year institution of higher education that provides intensive and sus- tained collaboration between faculty and local edu- cational agencies consistent with the requirements of this title; and (v) a school or department of arts and sciences within such partner institution; and (B) may include any of the following: (i) The Governor of the State.
(ii) The State educational agency.

(iii) The State board of education.

(iv) The State agency for higher education.

(v) A business.

(vi) A public or private nonprofit educational orga- nization.

(vii) An educational service agency.

(viii) A teacher organization.

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200 (ix) A high-performing local educational agency, or a consortium of such local educational agencies, that can serve as a resource to the partnership.
(x) A charter school (as defined in section 4310 of the Elementary and Secondary Education Act of 1965).

(xi) A school or department within the partner in- stitution that focuses on psychology and human devel- opment.

(xii) A school or department within the partner in- stitution with comparable expertise in the disciplines of teaching, learning, and child and adolescent devel- opment.

(xiii) An entity operating a program that provides alternative routes to State certification of teachers.
(7) ESSENTIAL COMPONENTS OF READING INSTRUCTION.— The term ‘‘essential components of reading instruction’’ has the meaning given the term in section 1208 of the Elementary and Secondary Education Act of 1965 as such section was in effect on the day before the date of enactment of the Every Student Succeeds Act.
(8) EXEMPLARY TEACHER.—The term ‘‘exemplary teacher’’ has the meaning given the term in section 9101 of the Elemen- tary and Secondary Education Act of 1965 as such section was in effect on the day before the date of enactment of the Every Student Succeeds Act.
(9) HIGH-NEED EARLY CHILDHOOD EDUCATION PROGRAM.— The term ‘‘high-need early childhood education program’’ means an early childhood education program serving children from low-income families that is located within the geographic area served by a high-need local educational agency.
(10) HIGH-NEED LOCAL EDUCATIONAL AGENCY.—The term ‘‘high-need local educational agency’’ means a local educational agency— (A)(i) for which not less than 20 percent of the chil- dren served by the agency are children from low-income families; (ii) that serves not fewer than 10,000 children from low-income families; (iii) that meets the eligibility requirements for funding under the Small, Rural School Achievement Program under section 5211(b) of the Elementary and Secondary Education Act of 1965; or (iv) that meets the eligibility requirements for funding under the Rural and Low-Income School Program under section 5221(b) of the Elementary and Secondary Edu- cation Act of 1965; and (B)(i) for which there is a high percentage of teachers not teaching in the academic subject areas or grade levels in which the teachers were trained to teach; or (ii) for which there is a high teacher turnover rate or a high percentage of teachers with emergency, provisional, or temporary certification or licensure.
(11) HIGH-NEED SCHOOL.— September 8, 2023 As Amended Through P.L.

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200 HIGHER EDUCATION ACT OF 1965 82 (A) IN GENERAL.—The term ‘‘high-need school’’ means a school that, based on the most recent data available, meets one or both of the following: (i) The school is in the highest quartile of schools in a ranking of all schools served by a local edu- cational agency, ranked in descending order by per- centage of students from low-income families enrolled in such schools, as determined by the local educational agency based on one of the following measures of pov- erty: (I) The percentage of students aged 5 through 17 in poverty counted in the most recent census data approved by the Secretary.
(II) The percentage of students eligible for a free or reduced price school lunch under the Rich- ard B. Russell National School Lunch Act.

(III) The percentage of students in families re- ceiving assistance under the State program fund- ed under part A of title IV of the Social Security Act.

(IV) The percentage of students eligible to re- ceive medical assistance under the Medicaid pro- gram.

(V) A composite of two or more of the meas- ures described in subclauses (I) through (IV).
(ii) In the case of— (I) an elementary school, the school serves students not less than 60 percent of whom are eli- gible for a free or reduced price school lunch under the Richard B. Russell National School Lunch Act; or (II) any other school that is not an elementary school, the other school serves students not less than 45 percent of whom are eligible for a free or reduced price school lunch under the Richard B. Russell National School Lunch Act.
(B) SPECIAL RULE.— (i) DESIGNATION BY THE SECRETARY.—The Sec- retary may, upon approval of an application submitted by an eligible partnership seeking a grant under this title, designate a school that does not qualify as a high-need school under subparagraph (A) as a high- need school for the purpose of this title.
The Secretary shall base the approval of an application for designa- tion of a school under this clause on a consideration of the information required under clause (ii), and may also take into account other information submitted by the eligible partnership.

(ii) APPLICATION REQUIREMENTS.—An application for designation of a school under clause (i) shall in- clude— (I) the number and percentage of students at- tending such school who are— September 8, 2023 As Amended Through P.L.
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200 (aa) aged 5 through 17 in poverty counted in the most recent census data approved by the Secretary; (bb) eligible for a free or reduced price school lunch under the Richard B. Russell Na- tional School Lunch Act; (cc) in families receiving assistance under the State program funded under part A of title IV of the Social Security Act; or (dd) eligible to receive medical assistance under the Medicaid program; (II) information about the student academic achievement of students at such school; and (III) for a secondary school, the graduation rate for such school.
(12) HIGHLY COMPETENT.—The term ‘‘highly competent’’, when used with respect to an early childhood educator, means an educator— (A) with specialized education and training in develop- ment and education of young children from birth until entry into kindergarten; (B) with— (i) a baccalaureate degree in an academic major in the arts and sciences; or (ii) an associate’s degree in a related educational area; and (C) who has demonstrated a high level of knowledge and use of content and pedagogy in the relevant areas as- sociated with quality early childhood education.
øParagraph (13) was struck by section 9214(c)(1)(A) of Public Law 114-95.¿ (14) INDUCTION PROGRAM.—The term ‘‘induction program’’ means a formalized program for new teachers during not less than the teachers’ first two years of teaching that is designed to provide support for, and improve the professional perform- ance and advance the retention in the teaching field of, begin- ning teachers.
Such program shall promote effective teaching skills and shall include the following components: (A) High-quality teacher mentoring.

(B) Periodic, structured time for collaboration with teachers in the same department or field, including mentor teachers, as well as time for information-sharing among teachers, principals, administrators, other appropriate in- structional staff, and participating faculty in the partner institution.
(C) The application of empirically-based practice and scientifically valid research on instructional practices.

(D) Opportunities for new teachers to draw directly on the expertise of teacher mentors, faculty, and researchers to support the integration of empirically-based practice and scientifically valid research with practice.

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200 HIGHER EDUCATION ACT OF 1965 84 practice and, where applicable, scientifically valid re- search.
(F) Faculty who— in the classroom; and (i) model the integration hof research and practice (ii) assist new teachers with the effective use and integration of technology in the classroom.

(G) Interdisciplinary collaboration among exemplary teachers, faculty, researchers, and other staff who prepare new teachers with respect to the learning process and the assessment of learning.
(H) Assistance with the understanding of data, par- ticularly student achievement data, and the applicability of such data in classroom instruction.

(I) Regular and structured observation and evaluation of new teachers by multiple evaluators, using valid and re- liable measures of teaching skills.

(15) LIMITED ENGLISH PROFICIENT.—The term ‘‘limited English proficient’’ has the meaning given the term ‘English learner’ in section 8101 of the Elementary and Secondary Edu- cation Act of 1965.
(16) PARENT.—The term ‘‘parent’’ has the meaning given the term in section 8101 of the Elementary and Secondary Education Act of 1965.
(17) PARTNER INSTITUTION.—The term ‘‘partner institution’’ means an institution of higher education, which may include a two-year institution of higher education offering a dual pro- gram with a four-year institution of higher education, partici- pating in an eligible partnership that has a teacher prepara- tion program— (A) whose graduates exhibit strong performance on State-determined qualifying assessments for new teachers through— (i) demonstrating that 80 percent or more of the graduates of the program who intend to enter the field of teaching have passed all of the applicable State qualification assessments for new teachers, which shall include an assessment of each prospective teach- er’s subject matter knowledge in the content area in which the teacher intends to teach; or (ii) being ranked among the highest-performing teacher preparation programs in the State as deter- mined by the State— (I) using criteria consistent with the require- ments for the State report card under section 205(b) before the first publication of such report card; and (II) using the State report card on teacher preparation required under section 205(b), after the first publication of such report card and for every year thereafter; and (B) that requires— (i) each student in the program to meet high aca- demic standards or demonstrate a record of success, as September 8, 2023 As Amended Through P.L.
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200 determined by the institution (including prior to enter- ing and being accepted into a program), and partici- pate in intensive clinical experience; (ii) each student in the program preparing to be- come a teacher who meets the applicable State certifi- cation and licensure requirements, including any re- quirements for certification obtained through alter- native routes to certification, or, with regard to special education teachers, the qualifications described in sec- tion 612(a)(14)(C) of the Individuals with Disabilities Education Act; and (iii) each student in the program preparing to be- come an early childhood educator to meet degree re- quirements, as established by the State, and become highly competent.
(18) PRINCIPLES OF SCIENTIFIC RESEARCH.—The term ‘‘prin- ciples of scientific research’’ means principles of research that— (A) apply rigorous, systematic, and objective method- ology to obtain reliable and valid knowledge relevant to education activities and programs; (B) present findings and make claims that are appro- priate to, and supported by, the methods that have been employed; and (C) include, appropriate to the research being con- ducted— (i) use of systematic, empirical methods that draw on observation or experiment; (ii) use of data analyses that are adequate to sup- port the general findings; (iii) reliance on measurements or observational methods that provide reliable and generalizable find- ings; (iv) strong claims of causal relationships, only with research designs that eliminate plausible com- peting explanations for observed results, such as, but not limited to, random-assignment experiments; (v) presentation of studies and methods in suffi- cient detail and clarity to allow for replication or, at a minimum, to offer the opportunity to build system- atically on the findings of the research; (vi) acceptance by a peer-reviewed journal or cri- tique by a panel of independent experts through a comparably rigorous, objective, and scientific review; and (vii) consistency of findings across multiple studies or sites to support the generality of results and conclu- sions.
(19) PROFESSIONAL DEVELOPMENT.—The term ‘‘professional development’’ has the meaning given the term in section 8101 of the Elementary and Secondary Education Act of 1965.

(20) SCIENTIFICALLY VALID RESEARCH.—The term ‘‘scientif- ically valid research’’ includes applied research, basic research, and field-initiated research in which the rationale, design, and September 8, 2023 As Amended Through P.L.
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200 HIGHER EDUCATION ACT OF 1965 86 interpretation are soundly developed in accordance with prin- ciples of scientific research.
(21) TEACHER MENTORING.—The term ‘‘teacher mentoring’’ means the mentoring of new or prospective teachers through a program that— (A) includes clear criteria for the selection of teacher mentors who will provide role model relationships for mentees, which criteria shall be developed by the eligible partnership and based on measures of teacher effective- ness; (B) provides high-quality training for such mentors, including instructional strategies for literacy instruction and classroom management (including approaches that im- prove the schoolwide climate for learning, which may in- clude positive behavioral interventions and supports); (C) provides regular and ongoing opportunities for mentors and mentees to observe each other’s teaching methods in classroom settings during the day in a high- need school in the high-need local educational agency in the eligible partnership; (D) provides paid release time for mentors, as applica- ble; (E) provides mentoring to each mentee by a colleague who teaches in the same field, grade, or subject as the mentee; (F) promotes empirically-based practice of, and sci- entifically valid research on, where applicable— (i) teaching and learning; (ii) assessment of student learning; (iii) the development of teaching skills through the use of instructional and behavioral interventions; and (iv) the improvement of the mentees’ capacity to measurably advance student learning; and (G) includes— (i) common planning time or regularly scheduled collaboration for the mentor and mentee; and (ii) joint professional development opportunities.
(22) TEACHING RESIDENCY PROGRAM.—The term ‘‘teaching residency program’’ means a school-based teacher preparation program in which a prospective teacher— (A) for one academic year, teaches alongside a mentor teacher, who is the teacher of record; (B) receives concurrent instruction during the year de- scribed in subparagraph (A) from the partner institution, which courses may be taught by local educational agency personnel or residency program faculty, in the teaching of the content area in which the teacher will become certified or licensed; (C) acquires effective teaching skills; and (D) prior to completion of the program— (i) attains full State certification or licensure and, with respect to special education teachers, meets the qualifications described in section 612(a)(14)(C) of the Individuals with Disabilities Education Act; and September 8, 2023 As Amended Through P.L.
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201 (ii) acquires a master’s degree not later than 18 months after beginning the program.
(23) TEACHING SKILLS.—The term ‘‘teaching skills’’ means skills that enable a teacher to— (A) increase student learning, achievement, and the ability to apply knowledge; (B) effectively convey and explain academic subject matter; (C) effectively teach higher-order analytical, evalua- tion, problem-solving, and communication skills; (D) employ strategies grounded in the disciplines of teaching and learning that— (i) are based on empirically-based practice and sci- entifically valid research, where applicable, related to teaching and learning; (ii) are specific to academic subject matter; and (iii) focus on the identification of students’ specific learning needs, particularly students with disabilities, students who are limited English proficient, students who are gifted and talented, and students with low lit- eracy levels, and the tailoring of academic instruction to such needs; (E) conduct an ongoing assessment of student learn- ing, which may include the use of formative assessments, performance-based assessments, project-based assess- ments, or portfolio assessments, that measures higher- order thinking skills (including application, analysis, syn- thesis, and evaluation); (F) effectively manage a classroom, including the abil- ity to implement positive behavioral interventions and support strategies; (G) communicate and work with parents, and involve parents in their children’s education; and (H) use, in the case of an early childhood educator, age-appropriate and developmentally appropriate strate- gies and practices for children in early childhood education programs.
PART A—TEACHER QUALITY PARTNERSHIP GRANTS SEC.

201. ø20 U.S.C.

1022¿ PURPOSES.
The purposes of this part are to— (1) improve student achievement; (2) improve the quality of prospective and new teachers by improving the preparation of prospective teachers and enhanc- ing professional development activities for new teachers; (3) hold teacher preparation programs at institutions of higher education accountable for preparing teachers who meet the applicable State certification and licensure requirements, including any requirements for certification obtained through alternative routes to certification, or, with regard to special education teachers, the qualifications described in section September 8, 2023 As Amended Through P.L.
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202 HIGHER EDUCATION ACT OF 1965 88 612(a)(14)(C) of the Individuals with Disabilities Education Act; and (4) recruit highly qualified individuals, including minori- ties and individuals from other occupations, into the teaching force.

SEC.

202. ø20 U.S.C.

1022a¿ PARTNERSHIP GRANTS.


(a) PROGRAM AUTHORIZED.—From amounts made available under section 209, the Secretary is authorized to award grants, on a competitive basis, to eligible partnerships, to enable the eligible partnerships to carry out the activities described in subsection (c).
(b) APPLICATION.—Each eligible partnership desiring a grant under this section shall submit an application to the Secretary at such time, in such manner, and accompanied by such information as the Secretary may require.
Each such application shall con- tain— (1) a needs assessment of the partners in the eligible part- nership with respect to the preparation, ongoing training, pro- fessional development, and retention of general education and special education teachers, principals, and, as applicable, early childhood educators; (2) a description of the extent to which the program to be carried out with grant funds, as described in subsection (c), will prepare prospective and new teachers with strong teaching skills; (3) a description of how such program will prepare pro- spective and new teachers to understand and use research and data to modify and improve classroom instruction; (4) a description of— (A) how the eligible partnership will coordinate strate- gies and activities assisted under the grant with other teacher preparation or professional development programs, including programs funded under the Elementary and Sec- ondary Education Act of 1965 and the Individuals with Disabilities Education Act, and through the National Science Foundation; and (B) how the activities of the partnership will be con- sistent with State, local, and other education reform activi- ties that promote teacher quality and student academic achievement; (5) an assessment that describes the resources available to the eligible partnership, including— (A) the integration of funds from other related sources; (B) the intended use of the grant funds; and (C) the commitment of the resources of the partner- ship to the activities assisted under this section, including financial support, faculty participation, and time commit- ments, and to the continuation of the activities when the grant ends; (6) a description of— (A) how the eligible partnership will meet the pur- poses of this part; (B) how the partnership will carry out the activities required under subsection (d) or (e), based on the needs September 8, 2023 As Amended Through P.L.
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202 identified in paragraph (1), with the goal of improving stu- dent academic achievement; (C) if the partnership chooses to use funds under this section for a project or activities under subsection (f) or (g), how the partnership will carry out such project or required activities based on the needs identified in paragraph (1), with the goal of improving student academic achievement; (D) the partnership’s evaluation plan under section 204(a); (E) how the partnership will align the teacher prepa- ration program under subsection (c) with the— (i) State early learning standards for early child- hood education programs, as appropriate, and with the relevant domains of early childhood development; and (ii) challenging State academic standards under section 1111(b)(1) of the Elementary and Secondary Education Act of 1965, established by the State in which the partnership is located; (F) how the partnership will prepare general education teachers to teach students with disabilities, including training related to participation as a member of individ- ualized education program teams, as defined in section 614(d)(1)(B) of the Individuals with Disabilities Education Act; (G) how the partnership will prepare general edu- cation and special education teachers to teach students who are limited English proficient; (H) how faculty at the partner institution will work, during the term of the grant, with teachers who meet the applicable State certification and licensure requirements, including any requirements for certification obtained through alternative routes to certification, or, with regard to special education teachers, the qualifications described in section 612(a)(14)(C) of the Individuals with Disabilities Education Act, in the classrooms of high-need schools served by the high-need local educational agency in the partnership to— (i) provide high-quality professional development activities to strengthen the content knowledge and teaching skills of elementary school and secondary school teachers; and (ii) train other classroom teachers to implement literacy programs that incorporate the essential com- ponents of reading instruction; (I) how the partnership will design, implement, or en- hance a year-long and rigorous teaching preservice clinical program component; (J) how the partnership will support in-service profes- sional development strategies and activities; and (K) how the partnership will collect, analyze, and use data on the retention of all teachers and early childhood educators in schools and early childhood education pro- grams located in the geographic area served by the part- September 8, 2023 As Amended Through P.L.
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202 HIGHER EDUCATION ACT OF 1965 90 nership to evaluate the effectiveness of the partnership’s teacher and educator support system; and (7) with respect to the induction program required as part of the activities carried out under this section— (A) a demonstration that the schools and departments within the institution of higher education that are part of the induction program will effectively prepare teachers, in- cluding providing content expertise and expertise in teach- ing, as appropriate; (B) a demonstration of the eligible partnership’s capa- bility and commitment to, and the accessibility to and in- volvement of faculty in, the use of empirically-based prac- tice and scientifically valid research on teaching and learn- ing; (C) a description of how the teacher preparation pro- gram will design and implement an induction program to support, through not less than the first two years of teach- ing, all new teachers who are prepared by the teacher preparation program in the partnership and who teach in the high-need local educational agency in the partnership, and, to the extent practicable, all new teachers who teach in such high-need local educational agency, in the further development of the new teachers’ teaching skills, including the use of mentors who are trained and compensated by such program for the mentors’ work with new teachers; and (D) a description of how faculty involved in the induc- tion program will be able to substantially participate in an early childhood education program or an elementary school or secondary school classroom setting, as applicable, in- cluding release time and receiving workload credit for such participation.
(c) USE OF GRANT FUNDS.—An eligible partnership that re- ceives a grant under this section— (1) shall use grant funds to carry out a program for the preparation of teachers under subsection (d), a teaching resi- dency program under subsection (e), or a combination of such programs; and (2) may use grant funds to carry out a leadership develop- ment program under subsection (f).
(d) PARTNERSHIP GRANTS FOR THE PREPARATION OF TEACH- ERS.—An eligible partnership that receives a grant to carry out a program for the preparation of teachers shall carry out an effective pre-baccalaureate teacher preparation program or a 5th year initial licensing program that includes all of the following: (1) REFORMS.— (A) IN GENERAL.—Implementing reforms, described in subparagraph (B), within each teacher preparation pro- gram and, as applicable, each preparation program for early childhood education programs, of the eligible part- nership that is assisted under this section, to hold each program accountable for— (i) preparing— September 8, 2023 As Amended Through P.L.
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202 (I) new or prospective teachers to meet the applicable State certification and licensure re- quirements, including any requirements for cer- tification obtained through alternative routes to certification, or, with regard to special education teachers, the qualifications described in section 612(a)(14)(C) of the Individuals with Disabilities Education Act (including teachers in rural school districts, special educators, and teachers of stu- dents who are limited English proficient); (II) such teachers and, as applicable, early childhood educators, to understand empirically- based practice and scientifically valid research re- lated to teaching and learning and the applica- bility of such practice and research, including through the effective use of technology, instruc- tional techniques, and strategies consistent with the principles of universal design for learning, and through positive behavioral interventions and sup- port strategies to improve student achievement; and (III) as applicable, early childhood educators to be highly competent; and (ii) promoting strong teaching skills and, as appli- cable, techniques for early childhood educators to im- prove children’s cognitive, social, emotional, and phys- ical development.
(B) REQUIRED REFORMS.—The reforms described in subparagraph (A) shall include— (i) implementing teacher preparation program cur- riculum changes that improve, evaluate, and assess how well all prospective and new teachers develop teaching skills; (ii) using empirically-based practice and scientif- ically valid research, where applicable, about teaching and learning so that all prospective teachers and, as applicable, early childhood educators— (I) understand and can implement research- based teaching practices in classroom instruction; (II) have knowledge of student learning meth- ods; (III) possess skills to analyze student aca- demic achievement data and other measures of student learning, and use such data and measures to improve classroom instruction; (IV) possess teaching skills and an under- standing of effective instructional strategies across all applicable content areas that enable general education and special education teachers and early childhood educators to— (aa) meet the specific learning needs of all students, including students with disabil- ities, students who are limited English pro- ficient, students who are gifted and talented, September 8, 2023 As Amended Through P.L.
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202 HIGHER EDUCATION ACT OF 1965 92 students with low literacy levels and, as ap- plicable, children in early childhood education programs; and (bb) differentiate instruction for such stu- dents; (V) can effectively participate as a member of the individualized education program team, as de- fined in section 614(d)(1)(B) of the Individuals with Disabilities Education Act; and (VI) can successfully employ effective strate- gies for reading instruction using the essential components of reading instruction; (iii) ensuring collaboration with departments, pro- grams, or units of a partner institution outside of the teacher preparation program in all academic content areas to ensure that prospective teachers receive training in both teaching and relevant content areas in order to meet the applicable State certification and licensure requirements, including any requirements for certification obtained through alternative routes to certification, or, with regard to special education teachers, in section the qualifications described 612(a)(14)(C) of the Individuals with Disabilities Edu- cation Act, which may include training in multiple subjects to teach multiple grade levels as may be need- ed for individuals preparing to teach in rural commu- nities and for individuals preparing to teach students with disabilities; (iv) developing and implementing an induction program; (v) developing admissions goals and priorities aligned with the hiring objectives of the high-need local educational agency in the eligible partnership; and (vi) implementing program and curriculum changes, as applicable, to ensure that prospective teachers have the requisite content knowledge, prepa- ration, and degree to teach Advanced Placement or International Baccalaureate courses successfully.
(2) CLINICAL EXPERIENCE AND INTERACTION.—Developing and improving a sustained and high-quality preservice clinical education program to further develop the teaching skills of all prospective teachers and, as applicable, early childhood edu- cators, involved in the program.
Such program shall do the fol- lowing: (A) Incorporate year-long opportunities for enrichment, including— (i) clinical learning in classrooms in high-need schools served by the high-need local educational agency in the eligible partnership, and identified by the eligible partnership; and (ii) closely supervised interaction between prospec- tive teachers and faculty, experienced teachers, prin- cipals, other administrators, and school leaders at September 8, 2023 As Amended Through P.L.
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202 early childhood education programs (as applicable), el- ementary schools, or secondary schools, and providing support for such interaction.

(B) Integrate pedagogy and classroom practice and promote effective teaching skills in academic content areas.
(C) Provide high-quality teacher mentoring.

(D) Be offered over the course of a program of teacher preparation.

(E) Be tightly aligned with course work (and may be developed as a fifth year of a teacher preparation pro- gram).

(F) Where feasible, allow prospective teachers to learn to teach in the same local educational agency in which the teachers will work, learning the instructional initiatives and curriculum of that local educational agency.
(G) As applicable, provide training and experience to enhance the teaching skills of prospective teachers to bet- ter prepare such teachers to meet the unique needs of teaching in rural or urban communities.

(H) Provide support and training for individuals par- ticipating in an activity for prospective or new teachers de- scribed in this paragraph or paragraph (1) or (3), and for individuals who serve as mentors for such teachers, based on each individual’s experience.
Such support may in- clude— (i) with respect to a prospective teacher or a men- tor, release time for such individual’s participation; (ii) with respect to a faculty member, receiving course workload credit and compensation for time teaching in the eligible partnership’s activities; and (iii) with respect to a mentor, a stipend, which may include bonus, differential, incentive, or perform- ance pay, based on the mentor’s extra skills and re- sponsibilities.
(3) INDUCTION PROGRAMS FOR NEW TEACHERS.—Creating an induction program for new teachers or, in the case of an early childhood education program, providing mentoring or coaching for new early childhood educators.
(4) SUPPORT AND TRAINING FOR PARTICIPANTS IN EARLY CHILDHOOD EDUCATION PROGRAMS.—In the case of an eligible partnership focusing on early childhood educator preparation, implementing initiatives that increase compensation for early childhood educators who attain associate or baccalaureate de- grees in early childhood education.
(5) TEACHER RECRUITMENT.—Developing and implementing effective mechanisms (which may include alternative routes to State certification of teachers) to ensure that the eligible part- nership is able to recruit qualified individuals to become teach- ers who meet the applicable State certification and licensure requirements, including any requirements for certification ob- tained through alternative routes to certification, or, with re- gard to special education teachers, the qualifications described in section 612(a)(14)(C) of the Individuals with Disabilities September 8, 2023 As Amended Through P.L.
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202 HIGHER EDUCATION ACT OF 1965 94 Education Act through the activities of the eligible partnership, which may include an emphasis on recruiting into the teaching profession— (A) individuals from under represented populations; (B) individuals to teach in rural communities and teacher shortage areas, including mathematics, science, special education, and the instruction of limited English proficient students; and (C) mid-career professionals from other occupations, former military personnel, and recent college graduates with a record of academic distinction.
(6) LITERACY TRAINING.—Strengthening the literacy teach- ing skills of prospective and, as applicable, new elementary school and secondary school teachers— (A) to implement literacy programs that incorporate the essential components of reading instruction; (B) to use screening, diagnostic, formative, and summative assessments to determine students’ literacy levels, difficulties, and growth in order to improve class- room instruction and improve student reading and writing skills; (C) to provide individualized, intensive, and targeted literacy instruction for students with deficiencies in lit- eracy skills; and (D) to integrate literacy skills in the classroom across subject areas.
(e) PARTNERSHIP GRANTS FOR THE ESTABLISHMENT OF TEACH- ING RESIDENCY PROGRAMS.— (1) IN GENERAL.—An eligible partnership receiving a grant to carry out an effective teaching residency program shall carry out a program that includes all of the following activities: (A) Supporting a teaching residency program described in paragraph (2) for high-need subjects and areas, as de- termined by the needs of the high-need local educational agency in the partnership.
(B) Placing graduates of the teaching residency pro- gram in cohorts that facilitate professional collaboration, both among graduates of the teaching residency program and between such graduates and mentor teachers in the receiving school.
(C) Ensuring that teaching residents who participate in the teaching residency program receive— (i) effective preservice preparation as described in paragraph (2); (ii) teacher mentoring; (iii) support required through the induction pro- gram as the teaching residents enter the classroom as new teachers; and (iv) the preparation described in subparagraphs (A), (B), and (C) of subsection (d)(2).
(2) TEACHING RESIDENCY PROGRAMS.— (A) ESTABLISHMENT AND DESIGN.—A teaching resi- dency program under this paragraph shall be a program based upon models of successful teaching residencies that September 8, 2023 As Amended Through P.L.

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202 serves as a mechanism to prepare teachers for success in the high-need schools in the eligible partnership, and shall be designed to include the following characteristics of suc- cessful programs: (i) The integration of pedagogy, classroom prac- tice, and teacher mentoring.

(ii) Engagement of teaching residents in rigorous graduate-level course work leading to a master’s de- gree while undertaking a guided teaching apprentice- ship.
(iii) Experience and learning opportunities along- side a trained and experienced mentor teacher— (I) whose teaching shall complement the resi- dency program so that classroom clinical practice is tightly aligned with coursework; (II) who shall have extra responsibilities as a teacher leader of the teaching residency program, as a mentor for residents, and as a teacher coach during the induction program for new teachers, and for establishing, within the program, a learn- ing community in which all individuals are ex- pected to continually improve their capacity to ad- vance student learning; and (III) who may be relieved from teaching duties as a result of such additional responsibilities.
(iv) The establishment of clear criteria for the se- lection of mentor teachers based on measures of teach- er effectiveness and the appropriate subject area knowledge.

Evaluation of teacher effectiveness shall be based on, but not limited to, observations of the fol- lowing: (I) Planning and preparation, including dem- onstrated knowledge of content, pedagogy, and as- sessment, including the use of formative and diag- nostic assessments to improve student learning.
(II) Appropriate instruction that engages stu- dents with different learning styles.

(III) Collaboration with colleagues to improve instruction.

(IV) Analysis of gains in student learning, based on multiple measures that are valid and re- liable and that, when feasible, may include valid, reliable, and objective measures of the influence of teachers on the rate of student academic progress.
(V) In the case of mentor candidates who will be mentoring new or prospective literacy and mathematics coaches or instructors, appropriate skills in the essential components of reading in- struction, teacher training in literacy instructional strategies across core subject areas, and teacher training in mathematics instructional strategies, as appropriate.

September 8, 2023 As Amended Through P.L.


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202 HIGHER EDUCATION ACT OF 1965 96 (v) Grouping of teaching residents in cohorts to fa- cilitate professional collaboration among such resi- dents.
(vi) The development of admissions goals and pri- orities— (I) that are aligned with the hiring objectives of the local educational agency partnering with the program, as well as the instructional initia- tives and curriculum of such agency, in exchange for a commitment by such agency to hire qualified graduates from the teaching residency program; and (II) which may include consideration of appli- cants who reflect the communities in which they will teach as well as consideration of individuals from underrepresented populations in the teach- ing profession.
(vii) Support for residents, once the teaching resi- dents are hired as teachers of record, through an in- duction program, professional development, and net- working opportunities the residents through not less than the residents’ first two years of teaching.
(B) SELECTION OF INDIVIDUALS AS TEACHER RESI- to support DENTS.— (i) ELIGIBLE INDIVIDUAL.—In order to be eligible to be a teacher resident in a teaching residency program under this paragraph, an individual shall— (I) be a recent graduate of a four-year institu- tion of higher education or a mid-career profes- sional from outside the field of education pos- sessing strong content knowledge or a record of professional accomplishment; and (II) submit an application to the teaching resi- dency program.
(ii) SELECTION CRITERIA.—An eligible partnership carrying out a teaching residency program under this subsection shall establish criteria for the selection of eligible individuals to participate in the teaching resi- dency program based on the following characteristics: (I) Strong content knowledge or record of ac- complishment in the field or subject area to be taught.

(II) Strong verbal and written communication skills, which may be demonstrated by performance on appropriate tests.
(III) Other attributes linked to effective teach- ing, which may be determined by interviews or performance assessments, as specified by the eligi- ble partnership.

(C) STIPENDS OR SALARIES; APPLICATIONS; AGREE- MENTS; REPAYMENTS.— (i) STIPENDS OR SALARIES.—A teaching residency program under this subsection shall provide a one- September 8, 2023 As Amended Through P.L.
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202 year living stipend or salary to teaching residents dur- ing the teaching residency program.
(ii) APPLICATIONS FOR STIPENDS OR SALARIES.— Each teacher residency candidate desiring a stipend or salary during the period of residency shall submit an application to the eligible partnership at such time, and containing such information and assurances, as the eligible partnership may require.
(iii) AGREEMENTS TO SERVE.—Each application submitted under clause (ii) shall contain or be accom- panied by an agreement that the applicant will— (I) serve as a full-time teacher for a total of not less than three academic years immediately after successfully completing the teaching resi- dency program; (II) fulfill the requirement under subclause (I) by teaching in a high-need school served by the high-need local educational agency in the eligible partnership and teach a subject or area that is designated as high need by the partnership; (III) provide to the eligible partnership a cer- tificate, from the chief administrative officer of the local educational agency in which the resident is employed, of the employment required in sub- clauses (I) and (II) at the beginning of, and upon completion of, each year or partial year of service; (IV) meet the applicable State certification and licensure requirements, including any re- quirements for certification obtained through al- ternative routes to certification, or, with regard to special education teachers, the qualifications de- scribed in section 612(a)(14)(C) of the Individuals with Disabilities Education Act, when the appli- cant begins to fulfill the service obligation under this clause; and (IV) meet the requirements to be a highly qualified teacher, as defined in section 9101 of the Elementary and Secondary Education Act of 1965, or section 602 of the Individuals with Disabilities Education Act, when the applicant begins to fulfill the service obligation under this clause; and (V) comply with the requirements set by the eligible partnership under clause (iv) if the appli- cant is unable or unwilling to complete the service obligation required by this clause.
(iv) REPAYMENTS.— (I) IN GENERAL.—A grantee carrying out a teaching residency program under this paragraph shall require a recipient of a stipend or salary under clause (i) who does not complete, or who no- tifies the partnership that the recipient intends not to complete, the service obligation required byclause (iii)to repay such stipend or salary to the eligible partnership, together with interest, at a September 8, 2023 As Amended Through P.L.
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202 HIGHER EDUCATION ACT OF 1965 98 rate specified by the partnership in the agree- ment, and in accordance with such other terms and conditions specified by the eligible partner- ship, as necessary.
(II) OTHER TERMS AND CONDITIONS.—Any other terms and conditions specified by the eligi- ble partnership may include reasonable provisions for pro-rata repayment of the stipend or salary de- scribed in clause (i) or for deferral of a teaching resident’s service obligation required byclause (iii),on grounds of health, incapacitation, inability to secure employment in a school served by the el- igible partnership, being called to active duty in the Armed Forces of the United States, or other extraordinary circumstances.
(III) USE OF REPAYMENTS.—An eligible part- nership shall use any repayment received under this clause to carry out additional activities that are consistent with the purposes of this sub- section.
(f) PARTNERSHIP GRANTS FOR THE DEVELOPMENT OF LEADER- SHIP PROGRAMS.— (1) IN GENERAL.—An eligible partnership that receives a grant under this section may carry out an effective school lead- ership program, which may be carried out in partnership with a local educational agency located in a rural area and that shall include all of the following activities: (A) Preparing individuals enrolled or preparing to en- roll in school leadership programs for careers as super- intendents, principals, early childhood education program directors, or other school leaders (including individuals preparing to work in local educational agencies located in rural areas who may perform multiple duties in addition to the role of a school leader).
(B) Promoting strong leadership skills and, as applica- ble, techniques for school leaders to effectively— (i) create and maintain a data-driven, professional learning community within the leader’s school; (ii) provide a climate conducive to the professional development of teachers, with a focus on improving student academic achievement and the development of effective instructional leadership skills; (iii) understand the teaching and assessment skills needed to support successful classroom instruc- tion and to use data to evaluate teacher instruction and drive teacher and student learning; (iv) manage resources and school time to improve student academic achievement and ensure the school environment is safe; (v) engage and involve parents, community mem- bers, the local educational agency, businesses, and other community leaders, to leverage additional re- sources to improve student academic achievement; and September 8, 2023 As Amended Through P.L.
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202 (vi) understand how students learn and develop in order to increase academic achievement for all stu- dents.
(C) Ensuring that individuals who participate in the school leadership program receive— (i) effective preservice preparation as described in subparagraph (D); (ii) mentoring; and (iii) if applicable, full State certification or licen- sure to become a school leader.

(D) Developing and improving a sustained and high- quality preservice clinical education program to further de- velop the leadership skills of all prospective school leaders involved in the program.
Such clinical education program shall do the following: (i) Incorporate year-long opportunities for enrich- ment, including— learning (I) clinical in high-need schools served by the high-need local educational agency or a local educational agency located in a rural area in the eligible partnership and identified by the eligible partnership; and (II) closely supervised interaction between prospective school leaders and faculty, new and experienced teachers, and new and experienced school leaders, in such high-need schools.
(ii) Integrate pedagogy and practice and promote effective leadership skills, meeting the unique needs of urban, rural, or geographically isolated communities, as applicable.

(iii) Provide for mentoring of new school leaders.

(E) Creating an induction program for new school leaders.
(F) Developing and implementing effective mecha- nisms to ensure that the eligible partnership is able to re- cruit qualified leaders through the activities of the eligible partnership, which may include an emphasis on recruiting into school leader- ship professions— individuals to become school (i) individuals from underrepresented populations; (ii) individuals to serve as superintendents, prin- cipals, or other school administrators in rural and geo- graphically isolated communities and school leader shortage areas; and (iii) mid-career professionals from other occupa- tions, former military personnel, and recent college graduates with a record of academic distinction.
(2) SELECTION OF INDIVIDUALS FOR THE LEADERSHIP PRO- GRAM.—In order to be eligible for the school leadership pro- gram under this subsection, an individual shall be enrolled in or preparing to enroll in an institution of higher education, and shall— (A) be a— September 8, 2023 As Amended Through P.L.

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203 HIGHER EDUCATION ACT OF 1965 100 (i) recent graduate of an institution of higher edu- cation; (ii) mid-career professional from outside the field of education with strong content knowledge or a record of professional accomplishment; (iii) current teacher who is interested in becoming a school leader; or (iv) school leader who is interested in becoming a superintendent; and (B) submit an application to the leadership program.
(g) PARTNERSHIP WITH DIGITAL EDUCATION CONTENT DEVEL- OPER.—An eligible partnership that receives a grant under this sec- tion may use grant funds provided to carry out the activities de- scribed in subsection (d) or (e), or both, to partner with a television public broadcast station, as defined in section 397(6) of the Com- munications Act of 1934 (47 U.S.C.
397(6)), or another entity that develops digital educational content, for the purpose of improving the quality of pre-baccalaureate teacher preparation programs or to enhance the quality of preservice training for prospective teachers.

(h) EVALUATION AND REPORTING.—The Secretary shall— (1) evaluate the programs assisted under this section; and (2) make publicly available a report detailing the Sec- retary’s evaluation of each such program.
(i) CONSULTATION.— (1) IN GENERAL.—Members of an eligible partnership that receives a grant under this section shall engage in regular con- sultation throughout the development and implementation of programs and activities carried out under this section.

(2) REGULAR COMMUNICATION.—To ensure timely and meaningful consultation as described in paragraph (1), regular communication shall occur among all members of the eligible partnership, including the high-need local educational agency.
Such communication shall continue throughout the implemen- tation of the grant and the assessment of programs and activi- ties under this section.

(3) WRITTEN CONSENT.—The Secretary may approve changes in grant activities of a grant under this section only if the eligible partnership submits to the Secretary a written consent to such changes signed by all members of the eligible partnership.
(j) CONSTRUCTION.—Nothing in this section shall be construed to prohibit an eligible partnership from using grant funds to coordi- nate with the activities of eligible partnerships in other States or on a regional basis through Governors, State boards of education, State educational agencies, State agencies responsible for early childhood education, local educational agencies, or State agencies for higher education.
(k) SUPPLEMENT, NOT SUPPLANT.—Funds made available under this section shall be used to supplement, and not supplant, other Federal, State, and local funds that would otherwise be expended to carry out activities under this section.

SEC.

203. ø20 U.S.C.

1022b¿ ADMINISTRATIVE PROVISIONS.

(a) DURATION; NUMBER OF AWARDS; PAYMENTS.— September 8, 2023 As Amended Through P.L.
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203 (1) DURATION.—A grant awarded under this part shall be awarded for a period of five years.

(2) NUMBER OF AWARDS.—An eligible partnership may not receive more than one grant during a five-year period.
Nothing in this title shall be construed to prohibit an individual mem- ber, that can demonstrate need, of an eligible partnership that receives a grant under this title from entering into another eli- gible partnership consisting of new members and receiving a grant with such other eligible partnership before the five-year period described in the preceding sentence applicable to the eli- gible partnership with which the individual member has first partnered has expired.
(b) PEER REVIEW.— (1) PANEL.—The Secretary shall provide the applications submitted under this part to a peer review panel for evalua- tion.

With respect to each application, the peer review panel shall initially recommend the application for funding or for dis- approval.
(2) PRIORITY.—The Secretary, in funding applications under this part, shall give priority— (A) to eligible partnerships that include an institution of higher education whose teacher preparation program has a rigorous selection process to ensure the highest qual- ity of students entering such program; and (B)(i) to applications from broad-based eligible part- nerships that involve businesses and community organiza- tions; or (ii) to eligible partnerships so that the awards promote an equitable geographic distribution of grants among rural and urban areas.
(3) SECRETARIAL SELECTION.—The Secretary shall deter- mine, based on the peer review process, which applications shall receive funding and the amounts of the grants.

In deter- mining grant amounts, the Secretary shall take into account the total amount of funds available for all grants under this part and the types of activities proposed to be carried out by the eligible partnership.
(c) MATCHING REQUIREMENTS.— (1) IN GENERAL.—Each eligible partnership receiving a grant under this part shall provide, from non-Federal sources, an amount equal to 100 percent of the amount of the grant, which may be provided in cash or in-kind, to carry out the ac- tivities supported by the grant.
(2) WAIVER.—The Secretary may waive all or part of the matching requirement described in paragraph (1) for any fiscal year for an eligible partnership if the Secretary determines that applying the matching requirement to the eligible part- nership would result in serious hardship or an inability to carry out the authorized activities described in this part.
(d) LIMITATION ON ADMINISTRATIVE EXPENSES.—An eligible partnership that receives a grant under this part may use not more than two percent of the funds provided to administer the grant.

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204 HIGHER EDUCATION ACT OF 1965 102 SEC.

204. ø20 U.S.C.
204. ø20 U.S.C.

1022c¿ ACCOUNTABILITY AND EVALUATION.

(a) ELIGIBLE PARTNERSHIP EVALUATION.—Each eligible part- nership submitting an application for a grant under this part shall establish, and include in such application, an evaluation plan that includes strong and measurable performance objectives.
The plan shall include objectives and measures for increasing— (1) achievement for all prospective and new teachers, as measured by the eligible partnership; (2) teacher retention in the first three years of a teacher’s career; (3) improvement in the pass rates and scaled scores for ini- tial State certification or licensure of teachers; and (4)(A) the percentage of teachers who meet the applicable State certification and licensure requirements, including any requirements for certification obtained through alternative routes to certification, or, with regard to special education teachers, the qualifications described in section 612(a)(14)(C) of the Individuals with Disabilities Education Act (20 U.S.C.
1412(a)(14)(C)), hired by the high-need local educational agen- cy participating in the eligible partnership; (B) the percentage of teachers who meet the applicable State certification and licensure requirements, including any requirements for certification obtained through alternative routes to certification, or, with regard to special education ers, the qualifications described in section 612(a)(14)(C) of the Indi- viduals with Disabilities Education Act (20 U.S.C.
1412(a)(14)(C)), hired by the high-need local educational agen- cy who are members of underrepresented groups; (C) the percentage of teachers who meet the applicable State certification and licensure requirements, including any requirements for certification obtained through alternative routes to certification, or, with regard to special education teachers, the qualifications described in section 612(a)(14)(C) of the Individuals with Disabilities Education Act (20 U.S.C.
1412(a)(14)(C)), hired by the high-need local educational agen- cy who teach high-need academic subject areas (such as read- ing, mathematics, science, and foreign language, including less commonly taught languages and critical foreign languages); (D) the percentage of teachers who meet the applicable State certification and licensure requirements, including any requirements for certification obtained through alternative routes to certification, or, with regard to special education teachers, the qualifications described in section 612(a)(14)(C) of the Individuals with Disabilities Education Act (20 U.S.C.
1412(a)(14)(C)), hired by the high-need local educational agen- cy who teach in high-need areas (including special education, language instruction educational programs for limited English proficient students, and early childhood education); (E) the percentage of teachers who meet the applicable State certification and licensure requirements, including any requirements for certification obtained through alternative routes to certification, or, with regard to special education teachers, the qualifications described in section 612(a)(14)(C) of the Individuals with Disabilities Education Act (20 U.S.C.
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205 1412(a)(14)(C)), hired by the high-need local educational agen- cy who teach in high-need schools, disaggregated by the ele- mentary school and secondary school levels; (F) as applicable, the percentage of early childhood edu- cation program classes in the geographic area served by the el- igible partnership taught by early childhood educators who are highly competent; and (G) as applicable, the percentage of teachers trained— (i) to integrate technology effectively into curricula and instruction, including technology consistent with the principles of universal design for learning; and (ii) to use technology effectively to collect, manage, and analyze data to improve teaching and learning for the pur- pose of improving student academic achievement.
(b) INFORMATION.—An eligible partnership receiving a grant under this part shall ensure that teachers, principals, school super- intendents, faculty, and leadership at institutions of higher edu- cation located in the geographic areas served by the eligible part- nership are provided information, including through electronic means, about the activities carried out with funds under this part.
(c) REVISED APPLICATION.—If the Secretary determines that an eligible partnership receiving a grant under this part is not making substantial progress in meeting the purposes, goals, objectives, and measures of the grant, as appropriate, by the end of the third year of a grant under this part, then the Secretary— (1) shall cancel the grant; and (2) may use any funds returned or available because of such cancellation under paragraph (1) to— (A) increase other grant awards under this part; or (B) award new grants to other eligible partnerships under this part.
(d) EVALUATION AND DISSEMINATION.—The Secretary shall evaluate the activities funded under this part and report the find- ings regarding the evaluation of such activities to the authorizing committees.

The Secretary shall broadly disseminate— (1) successful practices developed by eligible partnerships under this part; and be ineffective.

(2) information regarding such practices that were found to SEC.

205. ø20 U.S.C.

1022d¿ ACCOUNTABILITY FOR PROGRAMS THAT PREPARE TEACHERS.
(a) INSTITUTIONAL AND PROGRAM REPORT CARDS ON THE QUAL- ITY OF TEACHER PREPARATION.— (1) REPORT CARD.—Each institution of higher education that conducts a traditional teacher preparation program or al- ternative routes to State certification or licensure program and that enrolls students receiving Federal assistance under this Act shall report annually to the State and the general public, in a uniform and comprehensible manner that conforms with the definitions and methods established by the Secretary, the following: (A) GOALS AND ASSURANCES.— (i) For the most recent year for which the informa- tion is available for the institution— September 8, 2023 As Amended Through P.L.
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205 HIGHER EDUCATION ACT OF 1965 104 (I) whether the goals set under section 206 have been met; and (II) a description of the activities the institu- tion implemented to achieve such goals.
(ii) A description of the steps the institution is taking to improve its performance in meeting the an- nual goals set under section 206.

(iii) A description of the activities the institution has implemented to meet the assurances provided under section 206.
(B) PASS RATES AND SCALED SCORES.—For the most re- cent year for which the information is available for those students who took the assessments used for teacher certifi- cation or licensure by the State in which the program is located and are enrolled in the traditional teacher prepara- tion program or alternative routes to State certification or licensure program, and for those who have taken such as- sessments and have completed the traditional teacher preparation program or alternative routes to State certifi- cation or licensure program during the two-year period preceding such year, for each of such assessments— (i) the percentage of students who have completed 100 percent of the nonclinical coursework and taken the assessment who pass such assessment; (ii) the percentage of all students who passed such assessment; (iii) the percentage of students who have taken such assessment who enrolled in and completed the traditional teacher preparation program or alternative routes to State certification or licensure program, as applicable; (iv) the average scaled score for all students who took such assessment; (v) a comparison of the program’s pass rates with the average pass rates for programs in the State; and (vi) a comparison of the program’s average scaled scores with the average scaled scores for programs in the State.
(C) PROGRAM INFORMATION.—A description of— (i) the criteria for admission into the program; (ii) the number of students in the program (disaggregated by race, ethnicity, and gender); (iii) the average number of hours of supervised clinical experience required for those in the program; (iv) the number of full-time equivalent faculty and students in the supervised clinical experience; and (v) the total number of students who have been certified or licensed as teachers, disaggregated by sub- ject and area of certification or licensure.
(D) STATEMENT.—In States that require approval or accreditation of teacher preparation programs, a statement of whether the institution’s program is so approved or ac- credited, and by whom.

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205 (E) DESIGNATION AS LOW-PERFORMING.—Whether the program has been designated as low-performing by the State under section 207(a).
(F) USE OF TECHNOLOGY.—A description of the activi- ties, including activities consistent with the principles of universal design for learning, that prepare teachers to in- tegrate technology effectively into curricula and instruc- tion, and to use technology effectively to collect, manage, and analyze data in order to improve teaching and learn- ing for the purpose of increasing student academic achieve- ment.
(G) TEACHER TRAINING.—A description of the activities that prepare general education and special education teachers to teach students with disabilities effectively, in- cluding training related to participation as a member of in- dividualized education program teams, as defined in sec- tion 614(d)(1)(B) of the Individuals with Disabilities Edu- cation Act, and to effectively teach students who are lim- ited English proficient.
(2) REPORT.—Each eligible partnership receiving a grant under section 202 shall report annually on the progress of the eligible partnership toward meeting the purposes of this part and the objectives and measures described in section 204(a).

(3) FINES.—The Secretary may impose a fine not to exceed $27,500 on an institution of higher education for failure to pro- vide the information described in this subsection in a timely or accurate manner.
(4) SPECIAL RULE.—In the case of an institution of higher education that conducts a traditional teacher preparation pro- gram or alternative routes to State certification or licensure program and has fewer than 10 scores reported on any single initial teacher certification or licensure assessment during an academic year, the institution shall collect and publish infor- mation, as required under paragraph (1)(B), with respect to an average pass rate and scaled score on each State certification or licensure assessment taken over a three-year period.
(b) STATE REPORT CARD ON THE QUALITY OF TEACHER PREPA- RATION.— (1) IN GENERAL.—Each State that receives funds under this Act shall provide to the Secretary, and make widely avail- able to the general public, in a uniform and comprehensible manner that conforms with the definitions and methods estab- lished by the Secretary, an annual State report card on the quality of teacher preparation in the State, both for traditional teacher preparation programs and for alternative routes to State certification or licensure programs, which shall include not less than the following: (A) A description of the reliability and validity of the teacher certification and licensure assessments, and any other certification and licensure requirements, used by the State.
(B) The standards and criteria that prospective teach- ers must meet to attain initial teacher certification or li- September 8, 2023 As Amended Through P.L.

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205 HIGHER EDUCATION ACT OF 1965 106 censure and to be certified or licensed to teach particular academic subjects, areas, or grades within the State.

(C) A description of how the assessments and require- ments described in subparagraph (A) are aligned with the challenging State academic standards required under sec- tion 1111(b)(1) of the Elementary and Secondary Edu- cation Act of 1965 and, as applicable, State early learning standards for early childhood education programs.
(D) For each of the assessments used by the State for teacher certification or licensure— (i) for each institution of higher education located in the State and each entity located in the State, in- cluding those that offer an alternative route for teach- er certification or licensure, the percentage of students at such institution or entity who have completed 100 percent of the nonclinical coursework and taken the assessment who pass such assessment; (ii) the percentage of all such students at all such institutions and entities who have taken the assess- ment who pass such assessment; (iii) the percentage of students who have taken the assessment who enrolled in and completed a teacher preparation program; and (iv) the average scaled score of individuals partici- pating in such a program, or who have completed such a program during the two-year period preceding the first year for which the annual State report card is provided, who took each such assessment.
(E) A description of alternative routes to teacher cer- tification or licensure in the State (including any such routes operated by entities that are not institutions of higher education), if any, including, for each of the assess- ments used by the State for teacher certification or licen- sure— (i) the percentage of individuals participating in such routes, or who have completed such routes during the two-year period preceding the date for which the determination is made, who passed each such assess- ment; and (ii) the average scaled score of individuals partici- pating in such routes, or who have completed such routes during the two-year period preceding the first year for which the annual State report card is pro- vided, who took each such assessment.
(F) A description of the State’s criteria for assessing the performance of teacher preparation programs within institutions of higher education in the State.

Such criteria shall include indicators of the academic content knowledge and teaching skills of students enrolled in such programs.
(G) For each teacher preparation program in the State— (i) the criteria for admission into the program; (ii) the number of students in the program, disaggregated by race, ethnicity, and gender (except September 8, 2023 As Amended Through P.L.

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205 that such disaggregation shall not be required in a case in which the number of students in a category is insufficient to yield statistically reliable information or the results would reveal personally identifiable infor- mation about an individual student); (iii) the average number of hours of supervised clinical experience required for those in the program; and (iv) the number of full-time equivalent faculty, ad- junct faculty, and students in supervised clinical expe- rience.
(H) For the State as a whole, and for each teacher preparation program in the State, the number of teachers prepared, in the aggregate and reported separately by— (i) area of certification or licensure; (ii) academic major; and (iii) subject area for which the teacher has been prepared to teach.
(I) A description of the extent to which teacher prepa- ration programs are addressing shortages of teachers who meet the applicable State certification and licensure re- quirements, including any requirements for certification obtained through alternative routes to certification, or, with regard to special education teachers, the qualifica- tions described in section 612(a)(14)(C) of the Individuals with Disabilities Education Act, by area of certification or licensure, subject, and specialty, in the State’s public schools.
(J) The extent to which teacher preparation programs prepare teachers, including general education and special education teachers, to teach students with disabilities ef- fectively, including training related to participation as a member of individualized education program teams, as de- fined in section 614(d)(1)(B) of the Individuals with Dis- abilities Education Act.
(K) A description of the activities that prepare teach- ers to— (i) integrate technology effectively into curricula and instruction, including activities consistent with the principles of universal design for learning; and (ii) use technology effectively to collect, manage, and analyze data to improve teaching and learning for the purpose of increasing student academic achieve- ment.
(L) The extent to which teacher preparation programs prepare teachers, including general education and special education teachers, to effectively teach students who are limited English proficient.

(2) PROHIBITION AGAINST CREATING A NATIONAL LIST.—The Secretary shall not create a national list or ranking of States, institutions, or schools using the scaled scores provided under this subsection.

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206 HIGHER EDUCATION ACT OF 1965 108 (c) DATA QUALITY.—The Secretary shall prescribe regulations to ensure the reliability, validity, integrity, and accuracy of the data submitted pursuant to this section.
(d) REPORT OF THE SECRETARY ON THE QUALITY OF TEACHER PREPARATION.— (1) REPORT CARD.—The Secretary shall annually provide to the authorizing committees, and publish and make widely available, a report card on teacher qualifications and prepara- tion in the United States, including all the information re- ported in subparagraphs (A) through (L) of subsection (b)(1).

Such report shall identify States for which eligible partner- ships received a grant under this part.
(2) REPORT TO CONGRESS.—The Secretary shall prepare and submit a report to the authorizing committees that con- tains the following: (A) A comparison of States’ efforts to improve the quality of the current and future teaching force.

(B) A comparison of eligible partnerships’ efforts to im- prove the quality of the current and future teaching force.
(C) The national mean and median scaled scores and pass rate on any standardized test that is used in more than one State for teacher certification or licensure.
(3) SPECIAL RULE.—In the case of a teacher preparation program with fewer than ten scores reported on any single ini- tial teacher certification or licensure assessment during an aca- demic year, the Secretary shall collect and publish, and make publicly available, information with respect to an average pass rate and scaled score on each State certification or licensure assessment taken over a three-year period.
(e) COORDINATION.—The Secretary, to the extent practicable, shall coordinate the information collected and published under this part among States for individuals who took State teacher certifi- cation or licensure assessments in a State other than the State in which the individual received the individual’s most recent degree.

SEC.

206. ø20 U.S.C.

1022e¿ TEACHER DEVELOPMENT.
(a) ANNUAL GOALS.—Each institution of higher education that conducts a traditional teacher preparation program (including pro- grams that offer any ongoing professional development programs) or alternative routes to State certification or licensure program, and that enrolls students receiving Federal assistance under this Act, shall set annual quantifiable goals for increasing the number of prospective teachers trained in teacher shortage areas des- ignated by the Secretary or by the State educational agency, in- cluding mathematics, science, special education, and instruction of limited English proficient students.
(b) ASSURANCES.—Each institution described in subsection (a)shall provide assurances to the Secretary that— (1) training provided to prospective teachers responds to the identified needs of the local educational agencies or States where the institution’s graduates are likely to teach, based on past hiring and recruitment trends; September 8, 2023 As Amended Through P.L.
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207 (2) training provided to prospective teachers is closely linked with the needs of schools and the instructional decisions new teachers face in the classroom; (3) prospective special education teachers receive course work in core academic subjects and receive training in pro- viding instruction in core academic subjects; (4) general education teachers receive training in providing instruction to diverse populations, including children with dis- abilities, limited English proficient students, and children from low-income families; and (5) prospective teachers receive training on how to effec- tively teach in urban and rural schools, as applicable.
(c) RULE OF CONSTRUCTION.—Nothing in this section shall be construed to require an institution to create a new teacher prepara- tion area of concentration or degree program or adopt a specific curriculum in complying with this section.

SEC.

207. ø20 U.S.C.

1022f¿ STATE FUNCTIONS.


(a) STATE ASSESSMENT.—In order to receive funds under this Act, a State shall conduct an assessment to identify low-performing teacher preparation programs in the State and to assist such pro- grams through the provision of technical assistance.

Each such State shall provide the Secretary with an annual list of low-per- forming teacher preparation programs and an identification of those programs at risk of being placed on such list, as applicable.
Such assessment shall be described in the report under section 205(b).
Levels of performance shall be determined solely by the State and may include criteria based on information collected pur- suant to this part, including progress in meeting the goals of— (1) increasing the percentage of teachers who meet the ap- plicable State certification and licensure requirements, includ- ing any requirements for certification obtained through alter- native routes to certification, or, with regard to special edu- cation in section 612(a)(14)(C) of the Individuals with Disabilities Education Act, in the State, including increasing professional develop- ment opportunities; the qualifications described teachers, (2) improving student academic achievement for elemen- tary and secondary students; and (3) raising the standards for entry into the teaching profes- sion.
(b) TERMINATION OF ELIGIBILITY.—Any teacher preparation program from which the State has withdrawn the State’s approval, or terminated the State’s financial support, due to the low perform- ance of the program based upon the State assessment described in subsection (a)— (1) shall be ineligible for any funding for professional de- velopment activities awarded by the Department; (2) may not be permitted to accept or enroll any student who receives aid under title IV in the institution’s teacher preparation program; (3) shall provide transitional support, including remedial services if necessary, for students enrolled at the institution at September 8, 2023 As Amended Through P.L.
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208 HIGHER EDUCATION ACT OF 1965 110 the time of termination of financial support or withdrawal of approval; and (4) shall be reinstated upon demonstration of improved performance, as determined by the State.
(c) NEGOTIATED RULEMAKING.—If the Secretary develops any regulations implementing subsection (b)(2), the Secretary shall sub- mit such proposed regulations to a negotiated rulemaking process, which shall include representatives of States, institutions of higher education, and educational and student organizations.
(d) APPLICATION OF THE REQUIREMENTS.—The requirements of this section shall apply to both traditional teacher preparation pro- grams and alternative routes to State certification and licensure programs.

SEC.

208. ø20 U.S.C.

1022g¿ GENERAL PROVISIONS.


(a) METHODS.—In complying with sections 205 and 206, the Secretary shall ensure that States and institutions of higher edu- cation use fair and equitable methods in reporting and that the re- porting methods do not reveal personally identifiable information.
(b) SPECIAL RULE.—For each State that does not use content assessments as a means of ensuring that all teachers teaching in core academic subjects within the State meet the applicable State certification and licensure requirements, including any require- ments for certification obtained through alternative routes to cer- tification, in accordance with the State plan submitted or revised under section 1111 of such Act, and that each person employed as a special education teacher in the State who teaches elementary school or secondary school meets the qualifications described in sec- tion 612(a)(14)(C) of the Individuals with Disabilities Education Act, the Secretary shall— (1) to the extent practicable, collect data comparable to the data required under this part from States, local educational agencies, institutions of higher education, or other entities that administer such assessments to teachers or prospective teach- ers; and (2) notwithstanding any other provision of this part, use such data to carry out requirements of this part related to as- sessments, pass rates, and scaled scores.
(c) RELEASE OF INFORMATION TO TEACHER PREPARATION PRO- GRAMS.— (1) IN GENERAL.—For the purpose of improving teacher preparation programs, a State that receives funds under this Act, or that participates as a member of a partnership, consor- tium, or other entity that receives such funds, shall provide to a teacher preparation program, upon the request of the teacher preparation program, any and all pertinent education-related information that— (A) may enable the teacher preparation program to evaluate the effectiveness of the program’s graduates or the program itself; and (B) is possessed, controlled, or accessible by the State.
(2) CONTENT OF INFORMATION.—The information described in paragraph (1)— September 8, 2023 As Amended Through P.L.

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231 (A) shall include an identification of specific individ- uals who graduated from the teacher preparation program to enable the teacher preparation program to evaluate the information provided to the program from the State with the program’s own data about the specific courses taken by, and field experiences of, the individual graduates; and (B) may include— (i) kindergarten through grade 12 academic achievement and demographic data, without revealing personally identifiable information about an individual student, for students who have been taught by grad- uates of the teacher preparation program; and (ii) teacher effectiveness evaluations for teachers who graduated from the teacher preparation program.
SEC.

209. ø20 U.S.C.

1022h¿ AUTHORIZATION OF APPROPRIATIONS.

There are authorized to be appropriated to carry out this part $300,000,000 for fiscal year 2009 and such sums as may be nec- essary for each of the two succeeding fiscal years.

PART B—ENHANCING TEACHER EDUCATION SEC.

230. ø20 U.S.C.

1031¿ AUTHORIZATION OF APPROPRIATIONS.

There are authorized to be appropriated to carry out this part such sums as may be necessary for fiscal year 2009 and each of the five succeeding fiscal years.
Subpart 1—Preparing Teachers for Digital Age Learners SEC.

231. ø20 U.S.C.

1032¿ PROGRAM AUTHORIZED.
(a) PROGRAM AUTHORITY.—The Secretary is authorized to award grants to, or enter into contracts or cooperative agreements with, eligible consortia to pay the Federal share of the costs of projects to— (1) assist in the graduation of teacher candidates who are prepared to use modern information, communication, and learning tools to— (A) improve student learning, assessment, and learning management; and (B) help students develop learning skills to succeed in higher education and to enter the workforce; (2) strengthen and develop partnerships among the stake- holders in teacher preparation to transform teacher education and ensure technology-rich teaching and learning environ- ments throughout a teacher candidate’s preservice education, including clinical experiences; and (3) assess the effectiveness of departments, schools, and colleges of education at institutions of higher education in pre- paring teacher candidates for successful implementation of technology-rich teaching and learning environments, including environments consistent with the principles of universal design for learning, that enable kindergarten through grade 12 stu- September 8, 2023 As Amended Through P.L.
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232 HIGHER EDUCATION ACT OF 1965 112 dents to develop learning skills to succeed in higher education and to enter the workforce.
(b) AMOUNT AND DURATION.—A grant, contract, or cooperative agreement under this subpart— (1) shall be for not more than $2,000,000; (2) shall be for a three-year period; and (3) may be renewed for one additional year.

(c) NON-FEDERAL SHARE REQUIREMENT.—The Federal share of the cost of any project funded under this subpart shall not exceed 75 percent.

The non-Federal share of the cost of such project may be provided in cash or in kind, fairly evaluated, including services.
(d) DEFINITION OF ELIGIBLE CONSORTIUM.—In this subpart, the term ‘‘eligible consortium’’ means a consortium of members that in- cludes the following: (1) Not less than one institution of higher education that awards baccalaureate or masters degrees and prepares teach- ers for initial entry into teaching.

(2) Not less than one State educational agency or local educational agency.

(3) A department, school, or college of education at an in- stitution of higher education.
(4) A department, school, or college of arts and sciences at an institution of higher education.

(5) Not less than one entity with the capacity to contribute to the technology-related reform of teacher preparation pro- grams, which may be a professional association, foundation, museum, library, for-profit business, public or private nonprofit organization, community-based organization, or other entity.

SEC.

232. ø20 U.S.C.

1032a¿ USES OF FUNDS.
(a) IN GENERAL.—An eligible consortium that receives a grant or enters into a contract or cooperative agreement under this sub- part shall use funds made available under this subpart to carry out a project that— (1) develops long-term partnerships among members of the consortium that are focused on effective teaching with modern digital tools and content that substantially connect preservice preparation of teacher candidates with high-need schools; or (2) transforms the way departments, schools, and colleges of education teach classroom technology integration, including the principles of universal design, to teacher candidates.
(b) USES OF FUNDS FOR PARTNERSHIP GRANTS.—In carrying out a project under subsection (a)(1), an eligible consortium shall— (1) provide teacher candidates, early in their preparation, with field experiences with technology in educational settings; (2) build the skills of teacher candidates to support tech- nology-rich instruction, assessment and learning management in content areas, technology literacy, an understanding of the principles of universal design, and the development of other skills for entering the workforce; (3) provide professional development in the use of tech- nology for teachers, administrators, and content specialists who participate in field placement; September 8, 2023 As Amended Through P.L.
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232 (4) provide professional development of technology peda- gogical skills for faculty of departments, schools, and colleges of education and arts and sciences; (5) implement strategies for the mentoring of teacher can- didates by members of the consortium with respect to tech- nology implementation; (6) evaluate teacher candidates during the first years of teaching to fully assess outcomes of the project; (7) build collaborative learning communities for technology integration within the consortium to sustain meaningful appli- cations of technology in the classroom during teacher prepara- tion and early career practice; and (8) evaluate the effectiveness of the project.
(c) USES OF FUNDS FOR TRANSFORMATION GRANTS.—In carrying out a project under subsection (a)(2), an eligible consortium shall— (1) redesign curriculum to require collaboration between the department, school, or college of education faculty and the department, school, or college of arts and sciences faculty who teach content or methods courses for training teacher can- didates; (2) collaborate between the department, school, or college of education faculty and the department, school, or college of arts and science faculty and academic content specialists at the local educational agency to educate preservice teachers who can integrate technology and pedagogical skills in content areas; (3) collaborate between the department, school, or college of education faculty and the department, school, or college of arts and sciences faculty who teach courses to preservice teach- ers to— (A) develop and implement a plan for preservice teachers and continuing educators that demonstrates effective instruc- tional strategies and application of such strategies in the use of digital tools to transform the teaching and learning process; and (B) better reach underrepresented preservice teacher popu- lations with programs that connect such preservice teacher populations with applications of technology; (4) collaborate among faculty and students to create and disseminate case studies of technology applications in class- room settings with a goal of improving student academic achievement in high-need schools; (5) provide additional technology resources for preservice teachers to plan and implement technology applications in classroom settings that provide evidence of student learning; and (6) bring together expertise from departments, schools, or colleges of education, arts and science faculty, and academic content specialists at the local educational agency to share and disseminate technology applications in the classroom through teacher preparation and into early career practice.
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233 HIGHER EDUCATION ACT OF 1965 114 SEC.

233. ø20 U.S.C.

1032b¿ APPLICATION REQUIREMENTS.


To be eligible to receive a grant or enter into a contract or co- operative agreement under this subpart, an eligible consortium shall submit an application to the Secretary at such time, in such manner, and containing such information as the Secretary may re- quire.
Such application shall include the following: (1) A description of the project to be carried out with the grant, including how the project will— (A) develop a long-term partnership focused on effec- tive teaching with modern digital tools and content that substantially connects preservice preparation of teacher candidates with high-need schools; or (B) transform the way departments, schools, and col- leges of education teach classroom technology integration, including the principles of universal design, to teacher can- didates.
(2) A demonstration of— (A) the commitment, including the financial commit- ment, of each of the members of the consortium for the proposed project; and (B) the support of the leadership of each organization that is a member of the consortium for the proposed project.

(3) A description of how each member of the consortium will participate in the project.
(4) A description of how the State educational agency or local educational agency will incorporate the project into the agency’s technology plan, if such a plan already exists.

(5) A description of how the project will be continued after Federal funds are no longer available under this subpart for the project.

(6) A description of how the project will incorporate— (A) State teacher technology standards; and (B) State student technology standards.
(7) A plan for the evaluation of the project, which shall in- clude benchmarks to monitor progress toward specific project objectives.

SEC.

234. ø20 U.S.C.

1032c¿ EVALUATION.

Not less than ten percent of the funds awarded to an eligible consortium to carry out a project under this subpart shall be used to evaluate the effectiveness of such project.

Subpart 2—Honorable Augustus F. Hawkins Centers of Excellence SEC.

241. ø20 U.S.C.

1033¿ DEFINITIONS.


In this subpart: (1) ELIGIBLE INSTITUTION.—The term ‘‘eligible institution’’ means— (A) an institution of higher education that has a teach- er preparation program that is a qualified teacher prepara- tion program and that is— (i) a part B institution (as defined in section 322); September 8, 2023 As Amended Through P.L.
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242 (ii) a Hispanic-serving institution (as defined in (iii) a Tribal College or University (as defined in section 502); section 316); (iv) an Alaska Native-serving institution (as de- (v) a Native Hawaiian-serving institution (as de- fined in section 317(b)); fined in section 317(b)); in section 318); (vi) a Predominantly Black Institution (as defined (vii) an Asian American and Native American Pa- cific Islander-serving institution (as defined in section 320(b)); or (viii) a Native American-serving, nontribal institu- tion (as defined in section 319); (B) a consortium of institutions described in subpara- graph (A); or (C) an institution described in subparagraph (A), or a consortium described in subparagraph (B), in partnership with any other institution of higher education, but only if the center of excellence established under section 242 is lo- cated at an institution described in subparagraph (A).
(2) SCIENTIFICALLY BASED READING RESEARCH.—The term ‘‘scientifically based reading research’’— (A) means research that applies rigorous, systemic, and objective procedures to obtain valid knowledge rel- evant to reading development, reading instruction, and reading difficulties; and (B) includes research that— (i) employs systemic, empirical methods that draw on observation or experiment; (ii) involves rigorous data analyses that are ade- quate to test the stated hypotheses and justify the general conclusions drawn; (iii) relies on measurements or observational methods that provide valid data across evaluators and observers and across multiple measurements and ob- servations; and (iv) has been accepted by a peer-reviewed journal or approved by a panel of independent experts through a comparably rigorous, objective, and scientific review.
SEC.

242. ø20 U.S.C.

1033a¿ AUGUSTUS F. HAWKINS CENTERS OF EXCEL- LENCE.

(a) PROGRAM AUTHORIZED.—From the amounts appropriated to carry out this part, the Secretary is authorized to award competi- tive grants to eligible institutions to establish centers of excellence.
(b) USE OF FUNDS.—Grants provided by the Secretary under this subpart shall be used to ensure that current and future teach- ers meet the applicable State certification and licensure require- ments, including any requirements for certification obtained through alternative routes to certification, or, with regard to spe- cial education teachers, the qualifications described in section 612(a)(14)(C) of the Individuals with Disabilities Education Act, by carrying out one or more of the following activities: September 8, 2023 As Amended Through P.L.
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242 HIGHER EDUCATION ACT OF 1965 116 (1) Implementing reforms within teacher preparation pro- grams to ensure that such programs are preparing teachers who meet the applicable State certification and licensure re- quirements, including any requirements for certification ob- tained through alternative routes to certification, or, with re- gard to special education teachers, the qualifications described in section 612(a)(14)(C) of the Individuals with Disabilities Education Act, are able to understand scientifically valid re- search, and are able to use advanced technology effectively in the classroom, including use of instructional techniques to im- prove student academic achievement, by— (A) retraining or recruiting faculty; and (B) designing (or redesigning) teacher preparation pro- grams that— (i) prepare teachers to serve in low-performing schools and close student achievement gaps, and that are based on rigorous academic content, scientifically valid research (including scientifically based reading research and mathematics research, as it becomes available), and challenging State academic content standards and student academic achievement stand- ards; and (ii) promote strong teaching skills.
(2) Providing sustained and high-quality preservice clinical experience, including the mentoring of prospective teachers by exemplary teachers, substantially increasing interaction be- tween faculty at institutions of higher education and new and experienced teachers, principals, and other administrators at elementary schools or secondary schools, and providing sup- port, including preparation time, for such interaction.
(3) Developing and implementing initiatives to promote re- tention of teachers who meet the applicable State certification and licensure requirements, including any requirements for certification obtained through alternative routes to certifi- cation, or, with regard to special education teachers, the quali- fications described in section 612(a)(14)(C) of the Individuals with Disabilities Education Act, and highly qualified prin- cipals, including minority teachers and principals, including programs that provide— (A) teacher or principal mentoring from exemplary teachers or principals, respectively; or (B) induction and support for teachers and principals during their first three years of employment as teachers or principals, respectively.
(4) Awarding scholarships based on financial need to help students pay the costs of tuition, room, board, and other ex- penses of completing a teacher preparation program, not to ex- ceed the cost of attendance.

(5) Disseminating information on effective practices for teacher preparation and successful teacher certification and li- censure assessment preparation strategies.

(6) Activities authorized under section 202.


(c) APPLICATION.—Any eligible institution desiring a grant under this subpart shall submit an application to the Secretary at September 8, 2023 As Amended Through P.L.

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251 such a time, in such a manner, and accompanied by such informa- tion as the Secretary may require.

(d) MINIMUM GRANT AMOUNT.—The minimum amount of each grant under this subpart shall be $500,000.

(e) LIMITATION ON ADMINISTRATIVE EXPENSES.—An eligible in- stitution that receives a grant under this subpart may use not more than two percent of the funds provided to administer the grant.

(f) REGULATIONS.—The Secretary shall prescribe such regula- tions as may be necessary to carry out this subpart.
Subpart 3—Preparing General Education Teach- ers to More Effectively Educate Students with Disabilities SEC.

251. ø20 U.S.C.

1034¿ TEACH TO REACH GRANTS.


(a) AUTHORIZATION OF PROGRAM.— (1) IN GENERAL.—The Secretary is authorized to award grants, on a competitive basis, to eligible partnerships to im- prove the preparation of general education teacher candidates to ensure that such teacher candidates possess the knowledge and skills necessary to effectively instruct students with dis- abilities in general education classrooms.
(2) DURATION OF GRANTS.—A grant under this section shall be awarded for a period of not more than five years.

(3) NON-FEDERAL SHARE.—An eligible partnership that re- ceives a grant under this section shall provide not less than 25 percent of the cost of the activities carried out with such grant from non-Federal sources, which may be provided in cash or in kind.
(b) DEFINITION OF ELIGIBLE PARTNERSHIP.—In this section, the term ‘‘eligible partnership’’ means a partnership that— (1) shall include— (A) one or more departments or programs at an insti- tution of higher education— (i) that prepare elementary or secondary general education teachers; (ii) that have a program of study that leads to an undergraduate degree, a master’s degree, or comple- tion of a postbaccalaureate program required for teacher certification; and (iii) the graduates of which meet the applicable State certification and licensure requirements, includ- ing any requirements for certification obtained through alternative routes to certification, or, with re- gard to special education teachers, the qualifications described in section 612(a)(14)(C) of the Individuals with Disabilities Education Act; (B) a department or program of special education at an institution of higher education; (C) a department or program at an institution of high- er education that provides degrees in core academic sub- jects; and September 8, 2023 As Amended Through P.L.
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251 HIGHER EDUCATION ACT OF 1965 118 (D) a high-need local educational agency; and (2) may include a department or program of mathematics, earth or physical science, foreign language, or another depart- ment at the institution that has a role in preparing teachers.
(c) ACTIVITIES.—An eligible partnership that receives a grant under this section— (1) shall use the grant funds to— (A) develop strengthen an undergraduate, postbaccalaureate, or master’s teacher preparation pro- gram by integrating special education strategies into the general education curriculum and academic content; or (B) provide teacher candidates participating in the program under subparagraph (A) with skills related to— (i) response to intervention, positive behavioral interventions and supports, differentiated instruction, and data driven instruction; (ii) universal design for learning; (iii) determining and utilizing accommodations for instruction and assessments; (iv) collaborating with special educators, related services providers, and parents, including participa- tion in individualized education program development and implementation; and (v) appropriately utilizing technology and assistive technology for students with disabilities; and (C) provide extensive clinical experience for partici- pants described in subparagraph (B) with mentoring and induction support throughout the program that continues during the first two years of full-time teaching; and (2) may use grant funds to develop and administer alter- nate assessments of students with disabilities.
(d) APPLICATION.—An eligible partnership seeking a grant under this section shall submit an application to the Secretary at such time, in such manner, and containing such information as the Secretary may require.
Such application shall include— (1) a self-assessment by the eligible partnership of the ex- isting teacher preparation program at the institution of higher education and needs related to preparing general education teacher candidates to instruct students with disabilities; and (2) an assessment of the existing personnel needs for gen- eral education teachers who instruct students with disabilities, performed by the local educational agency in which most grad- uates of the teacher preparation program are likely to teach after completion of the program under subsection (c)(1).
(e) PEER REVIEW.—The Secretary shall convene a peer review committee to review applications for grants under this section and to make recommendations to the Secretary regarding the selection of grantees.

Members of the peer review committee shall be recog- nized experts in the fields of special education, teacher preparation, and general education and shall not be in a position to benefit fi- nancially from any grants awarded under this section.
(f) EVALUATIONS.— (1) BY THE PARTNERSHIP.— September 8, 2023 As Amended Through P.L.

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255 (A) IN GENERAL.—An eligible partnership receiving a grant under this section shall conduct an evaluation at the end of the grant period to determine— (i) the effectiveness of the general education teachers who completed a program under subsection (c)(1) with respect to instruction of students with dis- abilities in general education classrooms; and (ii) the systemic impact of the activities carried out by such grant on how each institution of higher education that is a member of the partnership pre- pares teachers for instruction in elementary schools and secondary schools.
(B) REPORT TO THE SECRETARY.—Each eligible partner- ship performing an evaluation under subparagraph (A) shall report the findings of such evaluation to the Sec- retary.
(2) REPORT BY THE SECRETARY.—Not later than 180 days after the last day of the grant period under this section, the Secretary shall make available to Congress and the public the findings of the evaluations submitted under paragraph (1), and information on best practices related to effective instruction of students with disabilities in general education classrooms.

Subpart 4—Adjunct Teacher Corps SEC.

255. ø20 U.S.C.

1035¿ ADJUNCT TEACHER CORPS.


(a) PURPOSE.—The purpose of this section is to create opportu- nities for professionals and other individuals with subject matter expertise in mathematics, science, or critical foreign languages to provide such subject matter expertise to secondary school students on an adjunct basis.
(b) PROGRAM AUTHORIZED.—The Secretary is authorized to award grants on a competitive basis to eligible entities to identify, recruit, and train qualified individuals with subject matter exper- tise in mathematics, science, or critical foreign languages to serve as adjunct content specialists.

(c) DURATION OF GRANTS.—The Secretary may award grants under this section for a period of not more than five years.
(d) ELIGIBLE ENTITY.—In this section, the term ‘‘eligible entity’’ means— (1) a local educational agency; or (2) a partnership consisting of a local educational agency, serving as a fiscal agent, and a public or private educational organization or business.
(e) USES OF FUNDS.—An eligible entity that receives a grant under this section is authorized to use such grant to carry out one or both of the following activities: (1) To develop the capacity of the eligible entity to identify, recruit, and train individuals with subject matter expertise in mathematics, science, or critical foreign languages who are not employed in the elementary and secondary education system (including individuals in business and government, and indi- viduals who would participate through distance-learning ar- rangements) to become adjunct content specialists.
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255 HIGHER EDUCATION ACT OF 1965 120 (2) To provide preservice training and on-going profes- sional development to adjunct content specialists.
(f) APPLICATIONS.— (1) APPLICATION REQUIRED.—An eligible entity that desires a grant under this section shall submit an application to the Secretary at such time, in such manner, and containing such information as the Secretary may require.
(2) CONTENTS.—An application submitted under paragraph (1) shall include— (A) a description of— (i) the need for, and expected benefits of using, ad- junct content specialists in the schools served by the local educational agency, which may include informa- tion on the difficulty the local educational agency faces in recruiting qualified faculty in mathematics, science, and critical foreign language courses; (ii) measurable objectives for the activities sup- ported by the grant, including the number of adjunct content specialists the eligible entity intends to place in schools and classrooms, and the gains in academic achievement expected as a result of the addition of such specialists; (iii) how the eligible entity will establish criteria for and recruit the most qualified individuals and pub- lic or private organizations and businesses to partici- pate in the activities supported by the grant; (iv) how the eligible entity will provide preservice training and on-going professional development to ad- junct content specialists to ensure that such specialists have the capacity to serve effectively; (v) how the eligible entity will use funds received under this section, including how the eligible entity will evaluate the success of the activities supported by the grant; and (vi) how the eligible entity will support and con- tinue the activities supported by the grant after the grant has expired, including how such entity will seek support from other sources, such as State and local government and the private sector; and (B) an assurance that the use of adjunct content spe- cialists will not result in the displacement or transfer of currently employed teachers nor a reduction in the number of overall teachers in the district.
(g) PRIORITIES.—In awarding grants under this section, the Secretary shall give priority to eligible entities that demonstrate in the application for such a grant a plan to— (1) serve the schools served by the local educational agency that have a large number or percentage of students performing below grade level in mathematics, science, or critical foreign language courses; (2) serve local educational agencies that have a large num- ber or percentage of students from low-income families; and September 8, 2023 As Amended Through P.L.
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258 (3) recruit and train individuals to serve as adjunct con- tent specialists in schools that have an insufficient number of teachers in mathematics, science, or critical foreign languages.
(h) MATCHING REQUIREMENT.—Each eligible entity that re- ceives a grant under this section shall provide, from non-Federal sources, an amount equal to 100 percent of the amount of such grant (in cash or in kind) to carry out the activities supported by such grant.
(i) PERFORMANCE REPORT.—Each eligible entity receiving a grant under this section shall prepare and submit to the Secretary a final report on the results of the activities supported by such grant, which shall contain such information as the Secretary may require, including any improvements in student academic achieve- ment as a result of the use of adjunct content specialists.
(j) EVALUATION.—The Secretary shall evaluate the activities supported by grants under this section, including the impact of such activities on student academic achievement, and shall report the results of such evaluation to the authorizing committees.
(k) DEFINITION.—In this section, the term ‘‘adjunct content spe- cialist’’ means an individual who— (1) meets the applicable State certification and licensure requirements, including any requirements for certification ob- tained through alternative routes to certification, or, with re- gard to special education teachers, the qualifications described in section 612(a)(14)(C) of the Individuals with Disabilities Education Act; (2) has demonstrated expertise in mathematics, science, or a critical foreign language, as determined by the local edu- cational agency; and (3) is not the primary provider of instructional services to a student, unless the adjunct content specialist is under the di- rect supervision of a teacher who meets the applicable State certification and licensure requirements, including any require- ments for certification obtained through alternative routes to certification, or, with regard to special education teachers, the qualifications described in section 612(a)(14)(C) of the Individ- uals with Disabilities Education Act.
Subpart 5—Graduate Fellowships to Prepare Fac- ulty in High-Need Areas at Colleges of Edu- cation SEC.

258. ø20 U.S.C.

1036¿ GRADUATE FELLOWSHIPS TO PREPARE FAC- ULTY IN HIGH-NEED AREAS AT COLLEGES OF EDU- CATION.

(a) GRANTS BY SECRETARY.—The Secretary shall make grants to eligible institutions to enable such institutions to make graduate fellowship awards to qualified individuals in accordance with the provisions of this section.
(b) ELIGIBLE INSTITUTIONS.—In this section, the term ‘‘eligible institution’’ means an institution of higher education, or a consor- tium of institutions, postbaccalaureate study leading to a doctoral degree.

a program offers such that of September 8, 2023 As Amended Through P.L.

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258 HIGHER EDUCATION ACT OF 1965 122 (c) APPLICATIONS.—An eligible institution that desires a grant under this section shall submit an application to the Secretary at such time, in such manner, and containing such information as the Secretary may reasonably require.
(d) TYPES OF FELLOWSHIPS SUPPORTED.— (1) IN GENERAL.—An eligible institution that receives a grant under this section shall use the grant funds to provide graduate fellowships to individuals who are preparing for the professorate in order to prepare individuals to become elemen- tary school and secondary school mathematics and science teachers, special education teachers, and teachers who provide instruction for limited English proficient students, who meet the applicable State certification and licensure requirements, including any requirements for certification obtained through alternative routes to certification, or, with regard to special education teachers, the qualifications described in section 612(a)(14)(C) of the Individuals with Disabilities Education Act.
(2) TYPES OF STUDY.—A graduate fellowship provided under this section shall support an individual in pursuing postbaccalaureate study, which leads to a doctoral degree and may include a master’s degree as part of such study, related to teacher preparation and pedagogy in one of the following areas: (A) Science, technology, engineering, or mathematics, if the individual has completed a master’s degree in math- ematics or science and is pursuing a doctoral degree in mathematics, science, or education.
(B) Special education.

(C) The instruction of limited English proficient stu- dents, including postbaccalaureate study in language in- struction educational programs.
(e) FELLOWSHIP TERMS AND CONDITIONS.— (1) SELECTION OF FELLOWS.—The Secretary shall ensure that an eligible institution that receives a grant under this sec- tion— (A) shall provide graduate fellowship awards to indi- viduals who plan to pursue a career in instruction at an institution of higher education that has a teacher prepara- tion program; and (B) may not provide a graduate fellowship to an other- wise eligible individual— (i) during periods in which such individual is en- rolled at an institution of higher education unless such individual satisfactory academic progress in, and devoting full-time study or research to, the pursuit of the degree for which the fellowship support was provided; or is maintaining (ii) if the individual is engaged in gainful employ- ment, other than part-time employment related to teaching, research, or a similar activity determined by the institution to be consistent with and supportive of the individuals’s progress toward the degree for which the fellowship support was provided.
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258 (2) AMOUNT OF FELLOWSHIP AWARDS.— (A) IN GENERAL.—An eligible institution that receives a grant under this section shall award stipends to individ- uals who are provided graduate fellowships under this sec- tion.
(B) AWARDS BASED ON NEED.—A stipend provided under this section shall be in an amount equal to the level of support provided by the National Science Foundation graduate fellowships, except that such stipend shall be ad- justed as necessary so as not to exceed the fellowship re- cipient’s demonstrated need, as determined by the institu- tion of higher education where the fellowship recipient is enrolled.
(3) SERVICE REQUIREMENT.— (A) TEACHING REQUIRED.—Each individual who re- ceives a graduate fellowship under this section and earns a doctoral degree shall teach for one year at an institution of higher education that has a teacher preparation pro- gram for each year of fellowship support received under this section.
(B) INSTITUTIONAL OBLIGATION.—Each eligible institu- tion that receives a grant under this section shall provide an assurance to the Secretary that the institution has in- quired of and determined the decision of each individual who has received a graduate fellowship to, within three years of receiving a doctoral degree, begin employment at an institution of higher education that has a teacher prep- aration program, as required by this section.
(C) AGREEMENT REQUIRED.—Prior to receiving an ini- tial graduate fellowship award, and upon the annual re- newal of the graduate fellowship award, an individual se- lected to receive a graduate fellowship under this section shall sign an agreement with the Secretary agreeing to pursue a career in instruction at an institution of higher education that has a teacher preparation program in ac- cordance with subparagraph (A).
(D) FAILURE TO COMPLY.—If an individual who re- ceives a graduate fellowship award under this section fails to comply with the agreement signed pursuant to subpara- graph (C), the sum of the amounts of any graduate fellow- ship award received by such recipient shall, upon a deter- mination of such a failure, be treated as a Federal Direct Unsubsidized Stafford Loan under part D of title IV, and shall be subject to repayment, together with interest there- on accruing from the date of the fellowship award, in ac- cordance with terms and conditions specified by the Sec- retary in regulations under this subpart.
(E) MODIFIED SERVICE REQUIREMENT.—The Secretary may waive or modify the service requirement of this para- graph in accordance with regulations promulgated by the Secretary with respect to the criteria to determine the cir- cumstances under which compliance with such service re- quirement is inequitable or represents a substantial hard- ship.

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261 HIGHER EDUCATION ACT OF 1965 124 compliance by the fellowship recipient is determined to be inequitable or represent a substantial hardship— (i) because the individual is permanently and to- tally disabled at the time of the waiver request; or (ii) based on documentation presented to the Sec- retary of substantial economic or personal hardship.
(f) INSTITUTIONAL SUPPORT FOR FELLOWS.—An eligible institu- tion that receives a grant under this section may reserve not more than ten percent of the grant amount for academic and career tran- sition support for graduate fellowship recipients and for meeting the institutional obligation described in subsection (e)(3)(B).

(g) RESTRICTION ON USE OF FUNDS.—An eligible institution that receives a grant under this section may not use grant funds for general operational overhead of the institution.
PART C—GENERAL PROVISIONS SEC.

261. ø20 U.S.C.

1041¿ LIMITATIONS.

(a) FEDERAL CONTROL PROHIBITED.—Nothing in this title shall be construed to permit, allow, encourage, or authorize any Federal control over any aspect of any private, religious, or home school, whether or not a home school is treated as a private school or home school under State law.

This section shall not be construed to pro- hibit private, religious, or home schools from participation in pro- grams or services under this title.
(b) NO CHANGE IN STATE CONTROL ENCOURAGED OR RE- QUIRED.—Nothing in this title shall be construed to encourage or require any change in a State’s treatment of any private, religious, or home school, whether or not a home school is treated as a pri- vate school or home school under State law.
(c) NATIONAL SYSTEM OF TEACHER CERTIFICATION OR LICEN- SURE PROHIBITED.—Nothing in this title shall be construed to per- mit, allow, encourage, or authorize the Secretary to establish or support any national system of teacher certification or licensure.
(d) RULE OF CONSTRUCTION.—Nothing in this title shall be con- strued to alter or otherwise affect the rights, remedies, and proce- dures afforded to the employees of local educational agencies under Federal, State, or local laws (including applicable regulations or court orders) or under the terms of collective bargaining agree- ments, memoranda of understanding, or other agreements between such employees and their employers.

TITLE III—INSTITUTIONAL AID SEC.

301. ø20 U.S.C.

1051¿ FINDINGS AND PURPOSES.
(a) FINDINGS.—The Congress finds that— (1) there are a significant number of institutions of higher education serving high percentages of minority students and students from low-income backgrounds, that face problems that threaten their ability to survive; (2) the problems relate to the management and fiscal oper- ations of certain institutions of higher education, as well as to an inability to engage in long-range planning and development activities, including endowment building; September 8, 2023 As Amended Through P.L.
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311 (3) in order to be competitive and provide a high-quality education for all, institutions of higher education should im- prove their technological capacity and make effective use of technology; (4) the title III program prior to 1985 did not always meet the specific development needs of historically Black colleges and universities and other institutions with large concentra- tions of minority, low-income students; (5) the solution of the problems of these institutions would enable them to become viable, fiscally stable and independent, thriving institutions of higher education; (6) providing assistance to eligible institutions will en- hance the role of such institutions in providing access and quality education to low-income and minority students; (7) these institutions play an important role in the Amer- ican system of higher education, and there is a strong national interest in assisting them in solving their problems and in sta- bilizing their management and fiscal operations, and in becom- ing financially independent; and (8) there is a particular national interest in aiding those institutions of higher education that have historically served students who have been denied access to postsecondary edu- cation because of race or national origin and whose participa- tion in the American system of higher education is in the Na- tion’s interest so that equality of access and quality of postsec- ondary education opportunities may be enhanced for all stu- dents.
(b) PURPOSE.—It is the purpose of this title to assist such insti- tutions in equalizing educational opportunity through a program of Federal assistance.

PART A—STRENGTHENING INSTITUTIONS SEC.

311. ø20 U.S.C.

1057¿ PROGRAM PURPOSE.


(a) GENERAL AUTHORIZATION.—The Secretary shall carry out a program, in accordance with this part, to improve the academic quality, institutional management, and fiscal stability of eligible in- stitutions, in order to increase their self-sufficiency and strengthen their capacity to make a substantial contribution to the higher edu- cation resources of the Nation.
(b) GRANTS AWARDED; SPECIAL CONSIDERATION.—(1) From the sums available for this part under section 399(a)(1), the Secretary may award grants to any eligible institution with an application approved under section 391 in order to assist such an institution to plan, develop, or implement activities that promise to strengthen the institution.
(2) Special consideration shall be given to any eligible institu- tion— (A) which has endowment funds (other than any endow- ment fund built under section 332 of this Act as in effect on September 30, 1986, and under part B) the market value of which, per full-time equivalent student, is less than the aver- age current market value of the endowment funds, per full- time equivalent student (other than any endowment fund built September 8, 2023 As Amended Through P.L.
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311 HIGHER EDUCATION ACT OF 1965 126 under section 332 of this Act as in effect on September 30, 1986, and under part B) at similar institutions; or (B) which has expenditures per full-time equivalent stu- dent for library materials which is less than the average of the expenditures for library materials per full-time equivalent stu- dent by other similarly situated institutions.
(3) Special consideration shall be given to applications which propose, pursuant to the institution’s plan, to engage in— (A) faculty development; (B) funds and administrative management; (C) development and improvement of academic programs; (D) acquisition of equipment for use in strengthening funds management and academic programs; (E) joint use of facilities such as libraries and laboratories; and (F) student services, including services that will assist in the education of special populations.
(c) AUTHORIZED ACTIVITIES.—Grants awarded under this sec- tion shall be used for 1 or more of the following activities: (1) Purchase, rental, or lease of scientific or laboratory equipment for educational purposes, including instructional and research purposes.

(2) Construction, maintenance, renovation, and improve- ment in classrooms, libraries, laboratories, and other instruc- tional facilities, including the integration of computer tech- nology into institutional facilities to create smart buildings.
(3) Support of faculty exchanges, faculty development, and faculty fellowships to assist in attaining advanced degrees in the field of instruction of the faculty.

(4) Development and improvement of academic programs.

(5) Purchase of library books, periodicals, and other edu- cational materials, including telecommunications program ma- terial.
(6) Tutoring, counseling, and student service programs de- signed to improve academic success, including innovative, cus- tomized, instruction courses designed to help retain students and move the students rapidly into core courses and through program completion, which may include remedial education and English language instruction.

(7) Education or counseling services designed to improve the financial literacy and economic literacy of students or the students’ families.
(8) Funds management, administrative management, and acquisition of equipment for use in strengthening funds man- agement.

(9) Joint use of facilities, such as laboratories and libraries.

(10) Establishing or improving a development office to strengthen or improve contributions from alumni and the pri- vate sector.

(11) Establishing or improving an endowment fund.


(12) Creating or improving facilities for Internet or other distance education technologies, including purchase or rental of telecommunications technology equipment or services.

September 8, 2023 As Amended Through P.L.

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312 (13) Other activities proposed in the application submitted pursuant to subsection (b) and section 391 that— (A) contribute to carrying out the purposes of the pro- gram assisted under this part; and (B) are approved by the Secretary as part of the re- view and acceptance of such application.

(d) ENDOWMENT FUND.— (1) IN GENERAL.—An eligible institution may use not more than 20 percent of the grant funds provided under this part to establish or increase an endowment fund at such institution.
(2) MATCHING REQUIREMENT.—In order to be eligible to use grant funds in accordance with paragraph (1), the eligible in- stitution shall provide matching funds from non-Federal sources, in an amount equal to or greater than the Federal funds used in accordance with paragraph (1), for the establish- ment or increase of the endowment fund.
(3) COMPARABILITY.—The provisions of part C, regarding the establishment or increase of an endowment fund, that the Secretary determines are not inconsistent with this subsection, shall apply to funds used under paragraph (1).

SEC.

312. ø20 U.S.C.

1058¿ DEFINITIONS; ELIGIBILITY.
(a) EDUCATIONAL AND GENERAL EXPENDITURES.—For the pur- pose of this part, the term ‘‘educational and general expenditures’’ means the total amount expended by an institution of higher edu- cation for instruction, research, public service, academic support (including library expenditures), student services, institutional sup- port, scholarships and fellowships, operation and maintenance ex- penditures for the physical plant, and any mandatory transfers which the institution is required to pay by law.
(b) ELIGIBLE INSTITUTION.—For the purpose of this part, the term ‘‘eligible institution’’ means— (1) an institution of higher education— (A) which has an enrollment of needy students as re- quired by subsection (d); (B) except as provided in section 392(b), the average educational and general expenditures of which are low, per full-time equivalent undergraduate student, in comparison with the average educational and general expenditures per full-time equivalent undergraduate student of institutions that offer similar instruction; (C) which is— (i) legally authorized to provide, and provides within the State, an educational program for which such institution awards a bachelor’s degree; (ii) a junior or community college; or (iii) the College of the Marshall Islands, the Col- lege of Micronesia/Federated States of Micronesia, and Palau Community College; (D) which is accredited by a nationally recognized ac- crediting agency or association determined by the Sec- retary to be reliable authority as to the quality of training offered or which is, according to such an agency or associa- tion, making reasonable progress toward accreditation; September 8, 2023 As Amended Through P.L.
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312 HIGHER EDUCATION ACT OF 1965 128 (E) which meets such other requirements as the Sec- retary may prescribe; and (F) located in a State; and (2) any branch of any institution of higher education de- scribed under paragraph (1) which by itself satisfies the re- quirements contained in subparagraphs (A) and (B) of such paragraph.
For purposes of the determination of whether an institution is an eligible institution under this paragraph, the factor described under paragraph (1)(A) shall be given twice the weight of the factor described under paragraph (1)(B).
(c) ENDOWMENT FUND.—For the purpose of this part, the term ‘‘endowment fund’’ means a fund that— (1) is established by State law, by an institution of higher education, or by a foundation that is exempt from Federal in- come taxation; (2) is maintained for the purpose of generating income for the support of the institution; and (3) does not include real estate.
(d) ENROLLMENT OF NEEDY STUDENTS.—Except as provided in section 318(b), for the purpose of this part, the term ‘‘enrollment of needy students’’ means an enrollment at an institution of higher education or a junior or community college which includes— (1) at least 50 percent of the degree students so enrolled who are receiving need-based assistance under title IV of this Act in the second fiscal year preceding the fiscal year for which the determination is being made (other than loans for which an interest subsidy is paid pursuant to section 428), or (2) a substantial percentage of students receiving Pell Grants in the second fiscal year preceding the fiscal year for which determination is being made, in comparison with the percentage of students receiving Pell Grants at all such institu- tions in the second fiscal year preceding the fiscal year for which the determination is made, unless the requirement of this paragraph is waived under section 392(a).
(e) FULL-TIME EQUIVALENT STUDENTS.—For the purpose of this part, the term ‘‘full-time equivalent students’’ means the sum of the number of students enrolled full time at an institution, plus the full-time equivalent of the number of students enrolled part time (determined on the basis of the quotient of the sum of the credit hours of all part-time students divided by 12) at such institution.
(f) JUNIOR OR COMMUNITY COLLEGE.—For the purpose of this part, the term ‘‘junior or community college’’ means an institution of higher education— (1) that admits as regular students persons who are be- yond the age of compulsory school attendance in the State in which the institution is located and who have the ability to benefit from the training offered by the institution; (2) that does not provide an educational program for which it awards a bachelor’s degree (or an equivalent degree); and (3) that— (A) provides an educational program of not less than 2 years that is acceptable for full credit toward such a de- gree, or September 8, 2023 As Amended Through P.L.
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316 (B) offers a 2-year program in engineering, mathe- matics, or the physical or biological sciences, designed to prepare a student to work as a technician or at the semiprofessional level in engineering, scientific, or other technological fields requiring the understanding and appli- cation of basic engineering, scientific, or mathematical principles of knowledge.
(g) LOW-INCOME INDIVIDUAL.—For the purpose of this part, the term ‘‘low-income individual’’ means an individual from a family whose taxable income for the preceding year did not exceed 150 percent of an amount equal to the poverty level determined by using criteria of poverty established by the Bureau of the Census.
(h) HISTORICALLY BLACK COLLEGE OR UNIVERSITY.—For the purposes of this section, no historically black college or university which is eligible for and receives funds under part B of this title is eligible for or may receive funds under this part.

SEC.

313. ø20 U.S.C.

1059¿ DURATION OF GRANT.

(a) AWARD PERIOD.—The Secretary may award a grant to an eligible institution under this part for 5 years.
(b) LIMITATIONS.—In awarding grants under this part the Sec- retary shall give priority to applicants who are not already receiv- ing a grant under this part, except that for the purpose of this sub- section a grant under subsection (c) and a grant under section 394(a)(1) shall not be considered a grant under this part.
(c) PLANNING GRANTS.—Notwithstanding subsection (a), the Secretary may award a grant to an eligible institution under this part for a period of one year for the purpose of preparation of plans and applications for a grant under this part.

(d) WAIT-OUT-PERIOD.—Each eligible institution that received a grant under this part for a 5-year period shall not be eligible to receive an additional grant under this part until 2 years after the date on which the 5-year grant period terminates.

SEC.

314. ø20 U.S.C.


1059a¿ APPLICATIONS.

Each eligible institution desiring to receive assistance under this part shall submit an application in accordance with the re- quirements of section 391.

SEC.

315. ø20 U.S.C.

1059b¿ GOALS FOR FINANCIAL MANAGEMENT AND ACADEMIC PROGRAM.
(a) GOALS.—Any application for a grant under this part shall describe measurable goals for the institution’s financial manage- ment and academic programs, and include a plan of how the appli- cant intends to achieve those goals.

(b) CONTINUATION REQUIREMENTS.—Any continuation applica- tion shall demonstrate the progress made toward achievement of the goals described pursuant to subsection (a).

SEC.

316. ø20 U.S.C.

1059c¿ AMERICAN INDIAN TRIBALLY CONTROLLED COLLEGES AND UNIVERSITIES.
(a) PROGRAM AUTHORIZED.—The Secretary shall provide grants and related assistance to Tribal Colleges and Universities to enable such institutions to improve and expand their capacity to serve In- dian students.

(b) DEFINITIONS.—In this section: September 8, 2023 As Amended Through P.L.

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316 HIGHER EDUCATION ACT OF 1965 130 (1) INDIAN.—The term ‘‘Indian’’ has the meaning given the term in section 2 of the Tribally Controlled Colleges and Uni- versities Assistance Act of 1978.

(2) INDIAN TRIBE.—The term ‘‘Indian tribe’’ has the mean- ing given the term in section 2 of the Tribally Controlled Col- leges and Universities Assistance Act of 1978.
(3) TRIBAL COLLEGE OR UNIVERSITY.—The term ‘‘Tribal Col- lege or University’’ means an institution that— (A) qualifies for funding under the Tribally Controlled Colleges and Universities Assistance Act of 1978 (25 U.S.C.

1801 et seq.)

or the Navajo Community College Act (25 U.S.C.

640a note); or (B) is cited in section 532 of the Equity in Educational Land-Grant Status Act of 1994 (7 U.S.C.

301 note).
301 note).

(4) INSTITUTION OF HIGHER EDUCATION.—The term ‘‘institu- tion of higher education’’ means an institution of higher edu- cation as defined in section 101(a), except that paragraph (2) of such section shall not apply.
(c) AUTHORIZED ACTIVITIES.— (1) IN GENERAL.—Grants awarded under this section shall be used by Tribal Colleges or Universities to assist such insti- tutions to plan, develop, undertake, and carry out activities to improve and expand such institutions’ capacity to serve Indian students.
(2) EXAMPLES OF AUTHORIZED ACTIVITIES.—The activities described in paragraph (1) may include— (A) purchase, rental, or lease of scientific or laboratory equipment for educational purposes, including instruc- tional and research purposes; (B) construction, maintenance, renovation, and im- provement in classrooms, libraries, laboratories, and other instructional facilities, including purchase or rental of tele- communications technology equipment or services, and the acquisition of real property adjacent to the campus of the institution on which to construct such facilities; (C) support of faculty exchanges, faculty development, and faculty fellowships to assist in attaining advanced de- grees in the faculty’s field of instruction or in tribal gov- ernance or tribal public policy; (D) academic instruction in disciplines in which Indi- ans are underrepresented and instruction in tribal govern- ance or tribal public policy; (E) purchase of library books, periodicals, and other educational materials, including telecommunications pro- gram material; (F) tutoring, counseling, and student service programs designed to improve academic success; (G) education or counseling services designed to im- prove the financial literacy and economic literacy of stu- dents or the students’ families; (H) funds management, administrative management, and acquisition of equipment for use in strengthening funds management; September 8, 2023 As Amended Through P.L.
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316 (I) joint use of facilities, such as laboratories and li- braries; (J) establishing or improving a development office to strengthen or improve contributions from alumni and the private sector; (K) establishing or enhancing a program of teacher education designed to qualify students to teach in elemen- tary schools or secondary schools, with a particular empha- sis on teaching Indian children and youth, that shall in- clude, as part of such program, preparation for teacher cer- tification; (L) establishing community outreach programs that encourage Indian elementary school and secondary school students to develop the academic skills and the interest to pursue postsecondary education; (M) developing or improving facilities for Internet use or other distance education technologies; and (N) other activities proposed in the application sub- mitted pursuant to subsection (d) that— (i) contribute to carrying out the activities de- scribed in subparagraphs (A) through (M); and (ii) are approved by the Secretary as part of the review and acceptance of such application.
(3) ENDOWMENT FUND.— (A) IN GENERAL.—A Tribal College or University may use not more than 20 percent of the grant funds provided under this section to establish or increase an endowment fund at the institution.
(B) MATCHING REQUIREMENT.—In order to be eligible to use grant funds in accordance with subparagraph (A), the Tribal College or University shall provide matching funds, in an amount equal to the Federal funds used in ac- cordance with subparagraph (A), for the establishment or increase of the endowment fund.
(C) COMPARABILITY.—The provisions of part C regard- ing the establishment or increase of an endowment fund, that the Secretary determines are not inconsistent with this paragraph, shall apply to funds used under subpara- graph (A).

(d) APPLICATION, PLAN, AND ALLOCATION.— (1) INSTITUTIONAL ELIGIBILITY.—To be eligible to receive assistance under this section, a Tribal College or University shall be an eligible institution under section 312(b).
(2) APPLICATION.— (A) IN GENERAL.—A Tribal College or University desir- ing to receive assistance under this section shall submit an application to the Secretary at such time, in such manner, and containing such information as the Secretary may rea- sonably require.

(B) STREAMLINED PROCESS.—The Secretary shall es- tablish application requirements in such a manner as to simplify and streamline the process for applying for grants under this section.
(3) AWARDS AND ALLOCATIONS TO INSTITUTIONS.— September 8, 2023 As Amended Through P.L.

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317 HIGHER EDUCATION ACT OF 1965 132 (A) CONSTRUCTION GRANTS.— (i) IN GENERAL.—Of the amount appropriated to carry out this section for any fiscal year, the Secretary may reserve 30 percent for the purpose of awarding one-year grants of not less than $1,000,000 to address construction, maintenance, and renovation needs at el- igible institutions.
(ii) PREFERENCE.—In providing grants under clause (i) for any fiscal year, the Secretary shall give preference to eligible institutions that have not re- ceived an award under this section for a previous fis- cal year.
(B) ALLOTMENT OF REMAINING FUNDS.— (i) IN GENERAL.—Except as provided in clause (ii), the Secretary shall distribute the remaining funds ap- propriated for any fiscal year to each eligible institu- tion as follows: (I) 60 percent of the remaining appropriated funds shall be distributed among the eligible Trib- al Colleges and Universities on a pro rata basis, based on the respective Indian student counts (as defined in section 2(a) of the Tribally Controlled Colleges and Universities Assistance Act of 1978 (25 U.S.C.
1801(a)) of the Tribal Colleges and Uni- versities.

(II) The remaining 40 percent shall be distrib- uted in equal shares to the eligible Tribal Colleges and Universities.

(ii) MINIMUM GRANT.—The amount distributed to a Tribal College or University under clause (i) shall not be less than $500,000.
(4) SPECIAL RULES.— (A) CONCURRENT FUNDING.—No Tribal College or Uni- versity that receives funds under this section shall concur- rently receive funds under any other provision of this part, part B, or part A of title V. (B) EXEMPTION.—Section 313(d) shall not apply to in- stitutions that are eligible to receive funds under this sec- tion.

SEC.

317. ø20 U.S.C.

1059d¿ ALASKA NATIVE AND NATIVE HAWAIIAN- SERVING INSTITUTIONS.
(a) PROGRAM AUTHORIZED.—The Secretary shall provide grants and related assistance to Alaska Native-serving institutions and Native Hawaiian-serving institutions to enable such institutions to improve and expand their capacity to serve Alaska Natives and Na- tive Hawaiians.
(b) DEFINITIONS.—For the purpose of this section— (1) the term ‘‘Alaska Native’’ has the meaning given the term in section 6306 of the Elementary and Secondary Edu- cation Act of 1965; (2) the term ‘‘Alaska Native-serving institution’’ means an institution of higher education that— (A) is an eligible institution under section 312(b); and September 8, 2023 As Amended Through P.L.
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317 (B) at the time of application, has an enrollment of un- dergraduate students that is at least 20 percent Alaska Native students; (3) the term ‘‘Native Hawaiian’’ has the meaning given the term in section 6207 of the Elementary and Secondary Edu- cation Act of 1965; and (4) the term ‘‘Native Hawaiian-serving institution’’ means an institution of higher education which— (A) is an eligible institution under section 312(b); and (B) at the time of application, has an enrollment of un- dergraduate students that is at least 10 percent Native Hawaiian students.
(c) AUTHORIZED ACTIVITIES.— (1) TYPES OF ACTIVITIES AUTHORIZED.—Grants awarded under this section shall be used by Alaska Native-serving insti- tutions and Native Hawaiian-serving institutions to assist such institutions to plan, develop, undertake, and carry out activi- ties to improve and expand such institutions’ capacity to serve Alaska Natives or Native Hawaiians.
(2) EXAMPLES OF AUTHORIZED ACTIVITIES.—Such programs may include— (A) purchase, rental, or lease of scientific or laboratory equipment for educational purposes, including instruc- tional and research purposes; (B) renovation and improvement in classroom, library, laboratory, and other instructional facilities; (C) support of faculty exchanges, and faculty develop- ment and faculty fellowships to assist in attaining ad- vanced degrees in the faculty’s field of instruction; (D) curriculum development and academic instruction; (E) purchase of library books, periodicals, microfilm, and other educational materials; (F) funds and administrative management, and acqui- sition of equipment for use in strengthening funds man- agement; (G) joint use of facilities such as laboratories and li- braries; (H) academic tutoring and counseling programs and student support services; and (I) education or counseling services designed to im- prove the financial literacy and economic literacy of stu- dents or the students’ families.
(d) APPLICATION PROCESS.— (1) INSTITUTIONAL ELIGIBILITY.—Each Alaska Native-serv- ing institution and Native Hawaiian-serving institution desir- ing to receive assistance under this section shall submit to the Secretary such enrollment data as may be necessary to dem- onstrate that the institution is an Alaska Native-serving insti- tution or a Native Hawaiian-serving institution as defined in subsection (b), along with such other information and data as the Secretary may by regulation require.
(2) APPLICATIONS.—Any institution which is determined by the Secretary to be an Alaska Native-serving institution or a Native Hawaiian-serving institution may submit an application September 8, 2023 As Amended Through P.L.

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318 HIGHER EDUCATION ACT OF 1965 134 for assistance under this section to the Secretary.

The Sec- retary shall, to the extent possible, prescribe a simplified and streamlined format for such applications that takes into ac- count the limited number of institutions that are eligible for assistance under this section.
Such application shall include— (A) a 5-year plan for improving the assistance pro- vided by the Alaska Native-serving institution or the Na- tive Hawaiian-serving institution to Alaska Native or Na- tive Hawaiian students; and (B) such other information and assurance as the Sec- retary may require.
(3) SPECIAL RULES.— (A) ELIGIBILITY.—No Alaskan Native-serving institu- tion or Native Hawaiian-serving institution that receives funds under this section shall concurrently receive funds under other provisions of this part or part B.

(B) EXEMPTION.—Section 313(d) shall not apply to in- stitutions that are eligible to receive funds under this sec- tion.
(C) DISTRIBUTION.—In awarding grants under this sec- tion, the Secretary shall, to the extent possible and con- sistent with the competitive process under which such grants are awarded, ensure maximum and equitable dis- tribution among all eligible institutions.

SEC.

318. ø20 U.S.C.

1059e¿ PREDOMINANTLY BLACK INSTITUTIONS.

(a) PURPOSE.—It is the purpose of this section to assist Pre- dominantly Black Institutions in expanding educational oppor- tunity through a program of Federal assistance.
(b) DEFINITIONS.—In this section: (1) ELIGIBLE INSTITUTION.—The term ‘‘eligible institution’’ means an institution of higher education that— (A) has an enrollment of needy undergraduate stu- dents; (B) has an average educational and general expendi- ture that is low, per full-time equivalent undergraduate student, in comparison with the average educational and full-time equivalent under- general expenditure per graduate student of institutions that offer similar instruc- tion, except that the Secretary may apply the waiver re- quirements described in section 392(b) to this subpara- graph in the same manner as the Secretary applies the waiver requirements to section 312(b)(1)(B); (C) has an enrollment of undergraduate students that is not less than 40 percent Black American students; (D) is legally authorized to provide, and provides, within the State an educational program for which the in- stitution of higher education awards a baccalaureate de- gree or, in the case of a junior or community college, an associate’s degree; (E) is accredited by a nationally recognized accrediting agency or association determined by the Secretary to be a reliable authority as to the quality of training offered or is, September 8, 2023 As Amended Through P.L.
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318 according to such an agency or association, making reason- able progress toward accreditation; and (F) is not receiving assistance under— (i) part B; (ii) part A of title V; or (iii) an annual authorization of appropriations under the Act of March 2, 1867 (14 Stat.
438; 20 U.S.C.

123).
(2) ENROLLMENT OF NEEDY STUDENTS.—The term ‘‘enroll- ment of needy students’’ means the enrollment at an eligible institution with respect to which not less than 50 percent of the undergraduate students enrolled in an academic program leading to a degree— (A) in the second fiscal year preceding the fiscal year for which the determination is made, were Federal Pell Grant recipients for such year; (B) come from families that receive benefits under a means-tested Federal benefit program; (C) attended a public or nonprofit private secondary school that— (i) is in the school district of a local educational agency that was eligible for assistance under part A of title I of the Elementary and Secondary Education Act of 1965 for any year during which the student at- tended such secondary school; and (ii) for the purpose of this paragraph and for such year of attendance, was determined by the Secretary (pursuant to regulations and after consultation with the State educational agency of the State in which the school is located) to be a school in which the enroll- ment of children meeting a measure of poverty under section 1113(a)(5) of such Act exceeds 30 percent of the total enrollment of such school; or (D) are first-generation college students and a major- ity of such first-generation college students are low-income individuals.
(3) FIRST-GENERATION COLLEGE STUDENT.—The term ‘‘first- generation college student’’ has the meaning given the term in section 402A(h).

(4) LOW-INCOME INDIVIDUAL.—The term ‘‘low-income indi- vidual’’ has the meaning given such term in section 402A(h).
(5) MEANS-TESTED FEDERAL BENEFIT PROGRAM.—The term ‘‘means-tested Federal benefit program’’ means a program of the Federal Government, other than a program under title IV, in which eligibility for the program’s benefits, or the amount of such benefits, are determined on the basis of income or re- sources of the individual or family seeking the benefit.
(6) PREDOMINANTLY BLACK INSTITUTION.—The term ‘‘Pre- dominantly Black Institution’’ means an institution of higher education, as defined in section 101(a)— (A) that is an eligible institution with not less than 1,000 undergraduate students; (B) at which not less than 50 percent of the under- graduate students enrolled at the eligible institution are September 8, 2023 As Amended Through P.L.
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318 HIGHER EDUCATION ACT OF 1965 136 low-income individuals or first-generation college students; and (C) at which not less than 50 percent of the under- graduate students are enrolled in an educational program leading to a bachelor’s or associate’s degree that the eligi- ble institution is licensed to award by the State in which the eligible institution is located.

(7) STATE.—The term ‘‘State’’ means each of the 50 States and the District of Columbia.
(c) GRANT AUTHORITY.— (1) IN GENERAL.—The Secretary is authorized to award grants, from allotments under subsection (e), to Predominantly Black Institutions to enable the Predominantly Black Institu- tions to carry out the authorized activities described in sub- section (d).

(2) PRIORITY.—In awarding grants under this section the Secretary shall give priority to Predominantly Black Institu- tions with large numbers or percentages of students described in subsections (b)(1)(A) or (b)(1)(C).
The level of priority given to Predominantly Black Institutions with large numbers or percentages of students described in subsection (b)(1)(A) shall be twice the level of priority given to Predominantly Black In- stitutions with large numbers or percentages of students de- scribed in subsection (b)(1)(C).
(d) AUTHORIZED ACTIVITIES.— (1) REQUIRED ACTIVITIES.—Grant funds provided under this section shall be used— (A) to assist the Predominantly Black Institution to plan, develop, undertake, and implement programs to en- hance the institution’s capacity to serve more low- and middle-income Black American students; (B) to expand higher education opportunities for stu- dents eligible to participate in programs under title IV by encouraging college preparation and student persistence in secondary school and postsecondary education; and (C) to strengthen the financial ability of the Predomi- nantly Black Institution to serve the academic needs of the students described in subparagraphs (A) and (B).
(2) ADDITIONAL ACTIVITIES.—Grant funds provided under this section shall be used for one or more of the following ac- tivities: (A) The activities described in paragraphs (1) through (12) of section 311(c).

(B) Academic instruction in disciplines in which Black Americans are underrepresented.
(C) Establishing or enhancing a program of teacher education designed to qualify students to teach in a public elementary school or secondary school in the State that shall include, as part of such program, preparation for teacher certification or licensure.

(D) Establishing community outreach programs that will encourage elementary school and secondary school students to develop the academic skills and the interest to pursue postsecondary education.

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318 (E) Other activities proposed in the application sub- mitted pursuant to subsection (f) that— (i) contribute to carrying out the purpose of this section; and (ii) are approved by the Secretary as part of the review and approval of an application submitted under subsection (f).

(3) ENDOWMENT FUND.— (A) IN GENERAL.—A Predominantly Black Institution may use not more than 20 percent of the grant funds pro- vided under this section to establish or increase an endow- ment fund at the institution.
(B) MATCHING REQUIREMENT.—In order to be eligible to use grant funds in accordance with subparagraph (A), a Predominantly Black Institution shall provide matching funds from non-Federal sources, in an amount equal to or greater than the Federal funds used in accordance with subparagraph (A), for the establishment or increase of the endowment fund.
(C) COMPARABILITY.—The provisions of part C, regard- ing the establishment or increase of an endowment fund, that the Secretary determines are not inconsistent with this subsection, shall apply to funds used under subpara- graph (A).

(4) LIMITATION.—Not more than 50 percent of the grant funds provided to a Predominantly Black Institution under this section may be available for the purpose of constructing or maintaining a classroom, library, laboratory, or other instruc- tional facility.
(e) ALLOTMENTS TO PREDOMINANTLY BLACK INSTITUTIONS.— (1) FEDERAL PELL GRANT BASIS.—From the amounts appro- priated to carry out this section for any fiscal year, the Sec- retary shall allot to each Predominantly Black Institution hav- ing an application approved under subsection (f) a sum that bears the same ratio to one-half of that amount as the number of Federal Pell Grant recipients in attendance at such institu- tion at the end of the academic year preceding the beginning of that fiscal year, bears to the total number of Federal Pell Grant recipients at all such institutions at the end of such aca- demic year.
(2) GRADUATES BASIS.—From the amounts appropriated to carry out this section for any fiscal year, the Secretary shall allot to each Predominantly Black Institution having an appli- cation approved under subsection (f) a sum that bears the same ratio to one-fourth of that amount as the number of grad- uates for such academic year at such institution, bears to the total number of graduates for such academic year at all such institutions.
(3) GRADUATES SEEKING A HIGHER DEGREE BASIS.—From the amounts appropriated to carry out this section for any fis- cal year, the Secretary shall allot to each Predominantly Black Institution having an application approved under subsection (f) a sum that bears the same ratio to one-fourth of that amount as the percentage of graduates from such institution who are September 8, 2023 As Amended Through P.L.
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319 HIGHER EDUCATION ACT OF 1965 138 admitted to and in attendance at, not later than two years after graduation with an associate’s degree or a baccalaureate degree, a baccalaureate degree-granting institution or a grad- uate or professional school in a degree program in disciplines in which Black American students are underrepresented, bears to the percentage of such graduates for all such institutions.
(4) MINIMUM ALLOTMENT.— (A) IN GENERAL.—Notwithstanding paragraphs (1), (2), and (3), the amount allotted to each Predominantly Black Institution under this section may not be less than $250,000.

(B) INSUFFICIENT AMOUNT.—If the amounts appro- priated to carry out this section for a fiscal year are not sufficient to pay the minimum allotment provided under subparagraph (A) for the fiscal year, then the amount of such minimum allotment shall be ratably reduced.
If addi- tional sums become available for such fiscal year, such re- duced allotment shall be increased on the same basis as the allotment was reduced until the amount allotted equals the minimum allotment required under subpara- graph (A).
(5) REALLOTMENT.—The amount of a Predominantly Black Institution’s allotment under paragraph (1), (2), (3), or (4) for any fiscal year that the Secretary determines will not be need- ed for such institution for the period for which such allotment is available, shall be available for reallotment to other Pre- dominantly Black Institutions in proportion to the original al- lotments to such other institutions under this section for such fiscal year.
The Secretary shall reallot such amounts from time to time, on such date and during such period as the Secretary determines appropriate.

(f) APPLICATIONS.—Each Predominantly Black Institution de- siring a grant under this section shall submit an application to the Secretary at such time, in such manner, and containing or accom- panied by such information as the Secretary may reasonably re- quire.

(g) APPLICATION REVIEW PROCESS.—Section 393 shall not apply to applications under this section.
(h) DURATION AND CARRYOVER.—Any grant funds paid to a Predominantly Black Institution under this section that are not ex- pended or used for the purposes for which the funds were paid within ten years following the date on which the grant was award- ed, shall be repaid to the Treasury.

(i) SPECIAL RULE ON ELIGIBILITY.—No Predominantly Black In- stitution that receives funds under this section shall concurrently receive funds under any other provision of this part, part B, or part A of title V. SEC.
319. ø20 U.S.C.

1059f¿ NATIVE AMERICAN-SERVING, NONTRIBAL IN- STITUTIONS.

(a) PROGRAM AUTHORIZED.—The Secretary shall provide grants and related assistance to Native American-serving, nontribal insti- tutions to enable such institutions to improve and expand their ca- pacity to serve Native Americans and low-income individuals.

(b) DEFINITIONS.—In this section: September 8, 2023 As Amended Through P.L.
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319 (1) NATIVE AMERICAN.—The term ‘‘Native American’’ means an individual who is of a tribe, people, or culture that is indigenous to the United States.
(2) NATIVE AMERICAN-SERVING, NONTRIBAL INSTITUTION.— The term ‘‘Native American-serving, nontribal institution’’ means an institution of higher education, as defined in section 101(a), that, at the time of application— (A) is an eligible institution under section 312(b); (B) has an enrollment of undergraduate students that is not less than 10 percent Native American students; and (C) is not a Tribal College or University (as defined in section 316).
(c) AUTHORIZED ACTIVITIES.— (1) TYPES OF ACTIVITIES AUTHORIZED.—Grants awarded under this section shall be used by Native American-serving, nontribal institutions to assist such institutions to plan, de- velop, undertake, and carry out activities to improve and ex- pand such institutions’ capacity to serve Native Americans and low-income individuals.
(2) EXAMPLES OF AUTHORIZED ACTIVITIES.—Such programs may include— (A) the purchase, rental, or lease of scientific or lab- oratory equipment for educational purposes, including in- structional and research purposes; (B) renovation and improvement in classroom, library, laboratory, and other instructional facilities; (C) support of faculty exchanges, and faculty develop- ment and faculty fellowships to assist faculty in attaining advanced degrees in the faculty’s field of instruction; (D) curriculum development and academic instruction; (E) the purchase of library books, periodicals, micro- film, and other educational materials; (F) funds and administrative management, and acqui- sition of equipment for use in strengthening funds man- agement; (G) the joint use of facilities such as laboratories and libraries; (H) academic tutoring and counseling programs and student support services; and (I) education or counseling services designed to im- prove the financial and economic literacy of students or the students’ families.
(d) APPLICATION PROCESS.— (1) INSTITUTIONAL ELIGIBILITY.—A Native American-serv- ing, nontribal institution desiring to receive assistance under this section shall submit to the Secretary such enrollment data as may be necessary to demonstrate that the institution is a Native American-serving, nontribal institution, along with such other information and data as the Secretary may reason- ably require.
(2) APPLICATIONS.— (A) AUTHORITY TO SUBMIT APPLICATIONS.—Any institu- tion that is determined by the Secretary to be a Native September 8, 2023 As Amended Through P.L.

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320 HIGHER EDUCATION ACT OF 1965 140 American-serving, nontribal institution may submit an ap- plication for assistance under this section to the Secretary.

(B) SIMPLIFIED AND STREAMLINED FORMAT.—The Sec- retary shall, to the extent possible, continue to prescribe a simplified and streamlined format for applications under this section that takes into account the limited number of institutions that are eligible for assistance under this sec- tion.
(C) CONTENT.—An application submitted under sub- paragraph (A) shall include— (i) a five-year plan for improving the assistance provided by the Native American-serving, nontribal in- stitution to Native Americans and low-income individ- uals; and (ii) such other information and assurances as the Secretary may reasonably require.
(3) SPECIAL RULES.— (A) ELIGIBILITY.—No Native American-serving, non- tribal institution that receives funds under this section shall concurrently receive funds under any other provision of this part, part B, or part A of title V. (B) EXEMPTION.—Section 313(d) shall not apply to in- stitutions that are eligible to receive funds under this sec- tion.
(C) DISTRIBUTION.—In awarding grants under this sec- tion, the Secretary shall, to the extent possible and con- sistent with the competitive process under which such grants are awarded, ensure maximum and equitable dis- tribution among all eligible institutions.

(D) MINIMUM GRANT AMOUNT.—The minimum amount of a grant under this section shall be $200,000.

SEC.

320. ø20 U.S.C.

1059g¿ ASIAN AMERICAN AND NATIVE AMERICAN PACIFIC ISLANDER-SERVING INSTITUTIONS.
(a) PROGRAM AUTHORIZED.—The Secretary shall provide grants and related assistance to Asian American and Native American Pa- cific Islander-serving institutions to enable such institutions to im- prove and expand their capacity to serve Asian Americans and Na- tive American Pacific Islanders and low-income individuals.
(b) DEFINITIONS.—In this section: (1) ASIAN AMERICAN.—The term ‘‘Asian American’’ has the meaning given the term ‘‘Asian’’ in the Office of Management and Budget’s Standards for Maintaining, Collecting, and Pre- senting Federal Data on Race and Ethnicity as published on October 30, 1997 (62 Fed.

Reg.

58789).
Reg.

58789).

(2) ASIAN AMERICAN AND NATIVE AMERICAN PACIFIC IS- LANDER-SERVING INSTITUTION.—The term ‘‘Asian American and Native American Pacific Islander-serving institution’’ means an institution of higher education that— (A) is an eligible institution under section 312(b); and (B) at the time of application, has an enrollment of un- dergraduate students that is not less than 10 percent stu- dents who are Asian American or Native American Pacific Islander.

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320 (3) NATIVE AMERICAN PACIFIC ISLANDER.—The term ‘‘Na- tive American Pacific Islander’’ means any descendant of the aboriginal people of any island in the Pacific Ocean that is a territory or possession of the United States.
(c) AUTHORIZED ACTIVITIES.— (1) TYPES OF ACTIVITIES AUTHORIZED.—Grants awarded under this section shall be used by Asian American and Native American Pacific Islander-serving institutions to assist such in- stitutions to plan, develop, undertake, and carry out activities to improve and expand such institutions’ capacity to serve Asian Americans and Native American Pacific Islanders and low-income individuals.
(2) EXAMPLES OF AUTHORIZED ACTIVITIES.—Such programs may include— (A) purchase, rental, or lease of scientific or laboratory equipment for educational purposes, including instruc- tional and research purposes; (B) renovation and improvement in classroom, library, laboratory, and other instructional facilities; (C) support of faculty exchanges, and faculty develop- ment and faculty fellowships to assist in attaining ad- vanced degrees in the faculty’s field of instruction; (D) curriculum development and academic instruction; (E) purchase of library books, periodicals, microfilm, and other educational materials; (F) funds and administrative management, and acqui- sition of equipment for use in strengthening funds man- agement; (G) joint use of facilities such as laboratories and li- braries; (H) academic tutoring and counseling programs and student support services; (I) establishing community outreach programs that will encourage elementary school and secondary school students to develop the academic skills and the interest to pursue postsecondary education; (J) establishing or improving an endowment fund; (K) academic instruction in disciplines in which Asian Americans and Native American Pacific Islanders are underrepresented; (L) conducting research and data collection for Asian American and Native American Pacific Islander popu- lations and subpopulations; (M) establishing partnerships with community-based organizations serving Asian Americans and Native Amer- ican Pacific Islanders; and (N) education or counseling services designed to im- prove the financial and economic literacy of students or the students’ families.
(d) APPLICATION PROCESS.— (1) INSTITUTIONAL ELIGIBILITY.—Each Asian American and Native American Pacific Islander-serving institution desiring to receive assistance under this section shall submit to the Sec- retary such enrollment data as may be necessary to dem- September 8, 2023 As Amended Through P.L.

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321 HIGHER EDUCATION ACT OF 1965 142 onstrate that the institution is an Asian American and Native American Pacific Islander-serving institution as defined in sub- section (b), along with such other information and data as the Secretary may reasonably require.

(2) APPLICATIONS.—Any institution that is determined by the Secretary to be an Asian American and Native American Pacific Islander-serving institution may submit an application for assistance under this section to the Secretary.
Such appli- cation shall include— (A) a five-year plan for improving the assistance pro- vided by the Asian American and Native American Pacific Islander-serving institution to Asian American and Native American Pacific Islander students and low-income indi- viduals; and (B) such other information and assurances as the Sec- retary may reasonably require.
(3) SPECIAL RULES.— (A) ELIGIBILITY.—No Asian American and Native American Pacific Islander-serving institution that receives funds under this section shall concurrently receive funds under any other provision of this part, part B, or title V. (B) EXEMPTION.—Section 313(d) shall not apply to in- stitutions that are eligible to receive funds under this sec- tion.
(C) DISTRIBUTION.—In awarding grants under this sec- tion, the Secretary shall— (i) to the extent possible and consistent with the competitive process under which such grants are awarded, ensure maximum and equitable distribution among all eligible institutions; and (ii) give priority consideration to institutions for which not less than 10 percent of such institution’s Asian American and Native American Pacific Islander students are low-income individuals.
PART B—STRENGTHENING HISTORICALLY BLACK COLLEGES AND UNIVERSITIES SEC.

321. ø20 U.S.C.

1060¿ FINDINGS AND PURPOSES.
The Congress finds that— (1) the historically Black colleges and universities have contributed significantly to the effort to attain equal oppor- tunity through postsecondary education for Black, low-income, and educationally disadvantaged Americans; (2) States and the Federal Government have discriminated in the allocation of land and financial resources to support Black public institutions under the Morrill Act of 1862 and its progeny, and against public and private Black colleges and uni- versities in the award of Federal grants and contracts, and the distribution of Federal resources under this Act and other Fed- eral programs which benefit institutions of higher education; (3) the current state of Black colleges and universities is partly attributable to the discriminatory action of the States and the Federal Government and this discriminatory action re- September 8, 2023 As Amended Through P.L.
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323 quires the remedy of enhancement of Black postsecondary in- stitutions to ensure their continuation and participation in ful- filling the Federal mission of equality of educational oppor- tunity; and (4) financial assistance to establish or strengthen the phys- ical plants, financial management, academic resources, and en- dowments of the historically Black colleges and universities are appropriate methods to enhance these institutions and facili- tate a decrease in reliance on governmental financial support and to encourage reliance on endowments and private sources.
SEC.

322. ø20 U.S.C.

1061¿ DEFINITIONS.

For the purpose of this part: (1) The term ‘‘graduate’’ means an individual who has at- tended an institution for at least three semesters and fulfilled academic requirements for undergraduate studies in not more than 5 consecutive school years.
(2) The term ‘‘part B institution’’ means any historically Black college or university that was established prior to 1964, whose principal mission was, and is, the education of Black Americans, and that is accredited by a nationally recognized accrediting agency or association determined by the Secretary to be a reliable authority as to the quality of training offered or is, according to such an agency or association, making rea- sonable progress toward accreditation, except that any branch campus of a southern institution of higher education that prior to September 30, 1986, received a grant as an institution with special needs under section 321 of this title and was formally recognized by the National Center for Education Statistics as a Historically Black College or University but was determined not to be a part B institution on or after October 17, 1986, shall, from the date of enactment of this exception, be consid- ered a part B institution.
(3) The term ‘‘Pell Grant recipient’’ means a recipient of fi- nancial aid under subpart 1 of part A of title IV of this Act.
(4) The term ‘‘professional and academic areas in which Blacks are underrepresented’’ shall be determined by the Sec- retary, in consultation with the Commissioner for Education Statistics and the Commissioner of the Bureau of Labor Statis- tics, on the basis of the most recent available satisfactory data, as professional and academic areas in which the percentage of Black Americans who have been educated, trained, and em- ployed is less than the percentage of Blacks in the general pop- ulation.
(5) The term ‘‘school year’’ means the period of 12 months beginning July 1 of any calendar year and ending June 30 of the following calendar year.

SEC.

323. ø20 U.S.C.

1062¿ GRANTS TO INSTITUTIONS.


(a) GENERAL AUTHORIZATION; USES OF FUNDS.—From amounts available under section 399(a)(2) for any fiscal year, the Secretary shall make grants (under section 324) to institutions which have applications approved by the Secretary (under section 325) for any of the following uses: September 8, 2023 As Amended Through P.L.
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323 HIGHER EDUCATION ACT OF 1965 144 (1) Purchase, rental, or lease of scientific or laboratory equipment for educational purposes, including instructional and research purposes.
(2) Construction, maintenance, renovation, and improve- ment in classroom, library, laboratory, and other instructional facilities, including purchase or rental of telecommunications technology equipment or services.

(3) Support of faculty exchanges, and faculty development and faculty fellowships to assist in attaining advanced degrees in their field of instruction.

(4) Academic instruction in disciplines in which Black Americans are underrepresented.
(5) Purchase of library books, periodicals, microfilm, and other educational materials, including telecommunications pro- gram materials.

(6) Tutoring, counseling, and student service programs de- signed to improve academic success.

(7) Funds and administrative management, and acquisi- tion of equipment for use in strengthening funds management.

(8) Joint use of facilities, such as laboratories and libraries.
(9) Establishing or improving a development office to strengthen or improve contributions from alumni and the pri- vate sector.

(10) Establishing or enhancing a program of teacher edu- cation designed to qualify students to teach in a public elemen- tary or secondary school in the State that shall include, as part of such program, preparation for teacher certification.
(11) Establishing community outreach programs which will encourage elementary and secondary students to develop the academic skills and the interest to pursue postsecondary edu- cation.

(12) Acquisition of real property in connection with the construction, renovation, or addition to or improvement of cam- pus facilities.
(13) Education or financial information designed to im- prove the financial literacy and economic literacy of students or the students’ families, especially with regard to student in- debtedness and student assistance programs under title IV.

(14) Services necessary for the implementation of projects or activities that are described in the grant application and that are approved, in advance, by the Secretary, except that not more than two percent of the grant amount may be used for this purpose.
(15) Other activities proposed in the application submitted pursuant to section 325 that— (A) contribute to carrying out the purposes of this part; and (B) are approved by the Secretary as part of the re- view and acceptance of such application.

(b) ENDOWMENT FUND.— (1) IN GENERAL.—An institution may use not more than 20 percent of the grant funds provided under this part to establish or increase an endowment fund at the institution.

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324 (2) MATCHING REQUIREMENT.—In order to be eligible to use grant funds in accordance with paragraph (1), the eligible in- stitution shall provide matching funds from non-Federal sources, in an amount equal to or greater than the Federal funds used in accordance with paragraph (1), for the establish- ment or increase of the endowment fund.
(3) COMPARABILITY.—The provisions of part C regarding the establishment or increase of an endowment fund, that the Secretary determines are not inconsistent with this subsection, shall apply to funds used under paragraph (1).

(c) LIMITATIONS.—(1) No grant may be made under this Act for any educational program, activity, or service related to sectarian instruction or religious worship, or provided by a school or depart- ment of divinity.
For the purpose of this subsection, the term ‘‘school or department of divinity’’ means an institution whose pro- gram is specifically for the education of students to prepare them to become ministers of religion or to enter upon some other reli- gious vocation, or to prepare them to teach theological subjects.
(2) Not more than 50 percent of the allotment of any institu- tion may be available for the purpose of constructing or maintain- ing a classroom, library, laboratory, or other instructional facility.

SEC.

324. ø20 U.S.C.

1063¿ ALLOTMENTS TO INSTITUTIONS.


(a) ALLOTMENT; PELL GRANT BASIS.—From the amounts appro- priated to carry out this part for any fiscal year, the Secretary shall allot to each part B institution a sum which bears the same ratio to one-half that amount as the number of Pell Grant recipients in attendance at such institution at the end of the school year pre- ceding the beginning of that fiscal year bears to the total number of Pell Grant recipients at all part B institutions.
(b) ALLOTMENT; GRADUATES BASIS.—From the amounts appro- priated to carry out this part for any fiscal year, the Secretary shall allot to each part B institution a sum which bears the same ratio to one-fourth that amount as the number of graduates for such school year at such institution bears to the total number of grad- uates for such school year at all part B institutions.
(c) ALLOTMENT; GRADUATE AND PROFESSIONAL STUDENT BASIS.—From the amounts appropriated to carry out this part for any fiscal year, the Secretary shall allot to each part B institution a sum which bears the same ratio to one-fourth of that amount as the percentage of graduates per institution, who are admitted to and in attendance at, within 5 years of graduation with a bacca- laureate degree, a graduate or professional school in a degree pro- gram in disciplines in which Blacks are underrepresented, bears to the percentage of such graduates per institution for all part B insti- tutions.
(d) MINIMUM ALLOTMENT.—(1) Notwithstanding subsections (a) through (c), and subject to subsection (h), if the amount of an award under this section for a part B institution, based on the data provided by the part B institution and the formula under sub- sections (a) through (c), would be— (A) an amount that is greater than $250,000 but less than $500,000, the Secretary shall award the part B institution an allotment in the amount of $500,000; and September 8, 2023 As Amended Through P.L.
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324 HIGHER EDUCATION ACT OF 1965 146 (B) an amount that is equal to or less than $250,000, the Secretary shall award the part B institution an allotment in the amount of $250,000.
(2) If the amount appropriated pursuant to section 399(a)(2)(A) for any fiscal year is not sufficient to pay the minimum allotment required by paragraph (1) to all part B institutions, the amount of such minimum allotments shall be ratably reduced.

If additional sums become available for such fiscal year, such reduced alloca- tions shall be increased on the same basis as the basis on which they were reduced (until the amount allotted equals the minimum allotment required by paragraph (1)).
(e) REALLOTMENT.—The amount of any part B institution’s al- lotment under subsection (a), (b), (c), or (d) for any fiscal year which the Secretary determines will not be required for such insti- tution for the period such allotment is available shall be available for reallotment from time to time on such date during such period as the Secretary may determine to other part B institutions in pro- portion to the original allotment to such other institutions under this section for such fiscal year.
(f) SPECIAL MERGER RULE.—(1) The Secretary shall permit any eligible institution for a grant under part B in any fiscal year prior to the fiscal year 1986 to apply for a grant under this part if the eligible institution has merged with another institution of higher education which is not so eligible or has merged with an eligible institution.

(2) The Secretary may establish such regulations as may be necessary to carry out the requirement of paragraph (1) of this sub- section.
(g) SPECIAL RULE FOR CERTAIN DISTRICT OF COLUMBIA ELIGI- BLE INSTITUTIONS.—In any fiscal year that the Secretary deter- mines that Howard University or the University of the District of Columbia will receive an allotment under subsections (b) and (c) of this section which is not in excess of amounts received by Howard University under the Act of March 2, 1867 (14 Stat.

438; 20 U.S.C.
438; 20 U.S.C.

123), relating to annual authorization of appropriations for Howard University, or by the University of the District of Columbia under the District of Columbia Self-Government and Governmental Reor- ganization Act (87 Stat.

774) for such fiscal year, then Howard Uni- versity and the University of the District of Columbia, as the case may be, shall be ineligible to receive an allotment under this sec- tion.
(h) CONDITIONS FOR ALLOTMENTS.— (1) STUDENT REQUIREMENTS FOR ALLOTMENT.—Notwith- standing any other provision of this section, a part B institu- tion that would otherwise be eligible for funds under this part shall not receive an allotment under this part for a fiscal year, including the minimum allotment under subsection (d), if the part B institution, in the academic year preceding such fiscal year— (A) did not have any enrolled students who were Pell Grant recipients; (B) did not graduate any students; or (C) where appropriate, did not have any students who, within 5 years of graduation from the part B institution, September 8, 2023 As Amended Through P.L.
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325 were admitted to and in attendance at a graduate or pro- fessional school in a degree program in disciplines in which Blacks are underrepresented.
(2) DATA REQUIREMENTS FOR ALLOTMENTS.—Notwith- standing any other provision of this section, a part B institu- tion shall not receive an allotment under this part for a fiscal year, including the minimum allotment under subsection (d), unless the institution provides the Secretary with the data re- quired by the Secretary and for purposes of the formula de- scribed in subsections (a) through (c), including— (A) the number of Pell Grant recipients enrolled in the part B institution in the academic year preceding such fis- cal year; (B) the number of students who earned an associate or baccalaureate degree from the part B institution in the academic year preceding such fiscal year; and (C) where appropriate, the percentage of students who, within 5 years of graduation from the part B institution, were admitted to and in attendance at a graduate or pro- fessional school in a degree program in disciplines in which Blacks are underrepresented in the academic year preceding such fiscal year.
SEC.

325. ø20 U.S.C.

1063a¿ APPLICATIONS.

(a) CONTENTS.—No part B institution shall be entitled to its al- lotment of Federal funds for any grant under section 324 for any period unless that institution meets the requirements of subpara- graphs (C), (D), and (E) of section 312(b)(1) and submits an applica- tion to the Secretary at such time, in such manner, and containing or accompanied by such information, as the Secretary may reason- ably require.
Each such application shall— (1) provide that the payments under this Act will be used for the purposes set forth in section 323; and (2) provide for making an annual report to the Secretary and provide for— (A) conducting, except as provided in subparagraph (B), a financial and compliance audit of an eligible institu- tion, with regard to any funds obtained by it under this title at least once every 2 years and covering the period since the most recent audit, conducted by a qualified, inde- pendent organization or person in accordance with stand- ards established by the Comptroller General for the audit of governmental organizations, programs, and functions, and as prescribed in regulations of the Secretary, the re- sults of which shall be submitted to the Secretary; or (B) with regard to an eligible institution which is au- dited under chapter 75 of title 31, United States Code, deeming such audit to satisfy the requirements of subpara- graph (A) for the period covered by such audit.
(b) APPROVAL.—The Secretary shall approve any application which meets the requirements of subsection (a) and shall not dis- approve any application submitted under this part, or any modi- fication thereof, without first affording such institution reasonable notice and opportunity for a hearing.

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326 HIGHER EDUCATION ACT OF 1965 148 (c) GOALS FOR FINANCIAL MANAGEMENT AND ACADEMIC PRO- GRAMS.—Any application for a grant under this part shall describe measurable goals for the institution’s financial management and academic programs and include a plan of how the applicant intends to achieve those goals.

SEC.

326. ø20 U.S.C.

1063b¿ PROFESSIONAL OR GRADUATE INSTITU- TIONS.
(a) GENERAL AUTHORIZATION.—(1) Subject to the availability of funds appropriated to carry out this section, the Secretary shall award program grants to each of the postgraduate institutions list- ed in subsection (e) that is determined by the Secretary to be mak- ing a substantial contribution to the legal, medical, dental, veteri- nary, or other graduate education opportunities in mathematics, engineering, or the physical or natural sciences for Black Ameri- cans.
(2) No grant in excess of $1,000,000 may be made under this section unless the postgraduate institution provides assurances that 50 percent of the cost of the purposes for which the grant is made will be paid from non-Federal sources, except that no institu- tion shall be required to match any portion of the first $1,000,000 of the institution’s award from the Secretary.
After funds are made available to each eligible institution under the funding rules de- scribed in subsection (f), the Secretary shall distribute, on a pro rata basis, any amounts which were not so made available (by rea- son of the failure of an institution to comply with the matching re- quirements of this paragraph) among the institutions that have complied with such matching requirement.

(b) DURATION.—Grants shall be made for a period not to exceed 5 years.
Any funds awarded for such five-year grant period that are obligated during such five-year period may be expended during the 10-year period beginning on the first day of such five-year period.
(c) USES OF FUNDS.—A grant under this section may be used for— (1) purchase, rental or lease of scientific or laboratory equipment for educational purposes, including instructional and research purposes; (2) construction, maintenance, renovation, and improve- ment in classroom, library, laboratory, and other instructional facilities, including purchase or rental of telecommunications technology equipment or services; (3) purchase of library books, periodicals, technical and other scientific journals, microfilm, microfiche, and other edu- cational materials, including telecommunications program ma- terials; (4) scholarships, fellowships, and other financial assistance for needy graduate and professional students to permit the en- rollment of the students in and completion of the doctoral de- gree in medicine, dentistry, pharmacy, veterinary medicine, law, and the doctorate degree in the physical or natural sciences, engineering, mathematics, or other scientific dis- ciplines in which African Americans are underrepresented; (5) establishing or improving a development office to strengthen and increase contributions from alumni and the pri- vate sector; September 8, 2023 As Amended Through P.L.
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326 (6) assisting in the establishment or maintenance of an in- stitutional endowment to facilitate financial independence pur- suant to section 331; (7) funds and administrative management, and the acqui- sition of equipment, including software, for use in strength- ening funds management and management information sys- tems; (8) acquisition of real property that is adjacent to the cam- pus in connection with the construction, renovation, or addition to or improvement of campus facilities; (9) education or financial information designed to improve the financial literacy and economic literacy of students or the students’ families, especially with regard to student indebted- ness and student assistance programs under title IV; (10) services necessary for the implementation of projects or activities that are described in the grant application and that are approved, in advance, by the Secretary, except that not more than two percent of the grant amount may be used for this purpose; (11) tutoring, counseling, and student service programs de- signed to improve academic success; and (12) other activities proposed in the application submitted under subsection (d) that— (A) contribute to carrying out the purposes of this part; and (B) are approved by the Secretary as part of the re- view and acceptance of such application.
(d) APPLICATION.—Any institution eligible for a grant under this section shall submit an application which— (1) demonstrates how the grant funds will be used to im- prove graduate educational opportunities for Black and low-in- come students, and lead to greater financial independence; and (2) provides, in the case of applications for grants in excess of $1,000,000, the assurances required by subsection (a)(2) and specifies the manner in which the eligible institution is going to pay the non-Federal share of the cost of the application.
(e) ELIGIBILITY.— (1) IN GENERAL.—Independent professional or graduate in- stitutions and programs eligible for grants under subsection (a) are the following: (A) Morehouse School of Medicine; (B) Meharry Medical School; (C) Charles R. Drew Postgraduate Medical School; (D) Clark-Atlanta University; (E) Tuskegee University School of Veterinary Medicine and other qualified graduate programs; (F) Xavier University School of Pharmacy and other qualified graduate programs; (G) Southern University School of Law and other qualified graduate programs; (H) Texas Southern University School of Law and School of Pharmacy and other qualified graduate pro- grams; September 8, 2023 As Amended Through P.L.
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326 HIGHER EDUCATION ACT OF 1965 150 (I) Florida A&M University School of Pharmaceutical Sciences and other qualified graduate programs; (J) North Carolina Central University School of Law and other qualified graduate programs; (K) Morgan State University qualified graduate pro- (L) Hampton University qualified graduate program; (M) Alabama A&M qualified graduate program; (N) North Carolina A&T State University qualified (O) University of Maryland Eastern Shore qualified graduate program; graduate program; (P) Jackson State University qualified graduate pro- (Q) Norfolk State University qualified graduate pro- (R) Tennessee State University qualified graduate pro- (S) Alabama State University qualified graduate pro- gram; gram; grams; grams; grams; (T) Prairie View A&M University qualified graduate programs; (U) Delaware State University qualified graduate pro- grams; (V) Langston University qualified graduate programs; (W) Bowie State University qualified graduate pro- grams; and (X) University of the District of Columbia David A. Clarke School of Law.
(2) QUALIFIED GRADUATE PROGRAM.—(A) For the purposes of this section, the term ‘‘qualified graduate program’’ means a graduate or professional program that provides a program of instruction in law or in the physical or natural sciences, engi- neering, mathematics, psychometrics, or other scientific dis- cipline in which African Americans are underrepresented and has students enrolled in such program at the time of applica- tion for a grant under this section.
(B) Notwithstanding the enrollment requirement contained in subparagraph (A), an institution may use an amount equal to not more than 10 percent of the institution’s grant under this section for the development of a new qualified graduate program.
(3) SPECIAL RULE.—Institutions that were awarded grants under this section prior to October 1, 2008, shall continue to receive such grants, subject to the availability of appropriated funds, regardless of the eligibility of the institutions described in subparagraphs (S) through (X) of paragraph (1).

(4) ONE GRANT PER INSTITUTION.—The Secretary shall not award more than 1 grant under this section in any fiscal year to any institution of higher education.
(5) INSTITUTIONAL CHOICE.—The president or chancellor of the institution may decide which graduate or professional school or qualified graduate program will receive funds under the grant in any 1 fiscal year, if the allocation of funds among September 8, 2023 As Amended Through P.L.
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326 the schools or programs is delineated in the application for funds submitted to the Secretary under this section.
(f) FUNDING RULE.—Subject to subsection (g), of the amount appropriated to carry out this section for any fiscal year— (1) the first $56,900,000 (or any lesser amount appro- priated) shall be available only for the purposes of making grants to institutions or programs described in subparagraphs (A) through (R) of subsection (e)(1); (2) any amount in excess of $56,900,000, but not in excess of $62,900,000, shall be available for the purpose of making grants to institutions or programs described in subparagraphs (S) through (X) of subsection (e)(1); and (3) any amount in excess of $62,900,000, shall be made available to each of the institutions or programs identified in subparagraphs (A) through (X) pursuant to a formula devel- oped by the Secretary that uses the following elements: (A) The ability of the institution to match Federal funds with non-Federal funds.
(B) The number of students enrolled in the programs for which the eligible institution received funding under this section in the previous year.

(C) The average cost of education per student, for all full-time graduate or professional students (or the equiva- lent) enrolled in the eligible professional or graduate school, or for doctoral students enrolled in the qualified graduate programs.
(D) The number of students in the previous year who received their first professional or doctoral degree from the programs for which the eligible institution received fund- ing under this section in the previous year.
(E) The contribution, on a percent basis, of the pro- grams for which the institution is eligible to receive funds under this section to the total number of African Ameri- cans receiving graduate or professional degrees in the pro- fessions or disciplines related to the programs for the pre- vious year.
(g) HOLD HARMLESS RULE.—Notwithstanding paragraphs (2) and (3) of subsection (f), no institution or qualified program identi- fied in subsection (e)(1) that received a grant for fiscal year 2008 and that is eligible to receive a grant in a subsequent fiscal year shall receive a grant amount in any such subsequent fiscal year that is less than the grant amount received for fiscal year 2008, un- less the amount appropriated is not sufficient to provide such grant amounts to all such institutions and programs, or the institution cannot provide sufficient matching funds to meet the requirements of this section.
(h) INTERACTION WITH OTHER GRANT PROGRAMS.—No institu- tion that is eligible for and receives an award under section 512, 723, or 724 for a fiscal year shall be eligible to apply for a grant, or receive grant funds, under this section for the same fiscal year.

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327 HIGHER EDUCATION ACT OF 1965 152 SEC.

327. ø20 U.S.C.

1063c¿ REPORTING AND AUDIT REQUIREMENTS.
(a) RECORDKEEPING.—Each recipient of a grant under this part shall keep such records as the Secretary shall prescribe, including records which fully disclose— (1) the amount and disposition by such recipient of the proceeds of such assistance; (2) the cost of the project or undertaking in connection with which such assistance is given or used; (3) the amount of that portion of the cost of the project or undertaking supplied by other sources; and (4) such other records as will facilitate an effective audit.
(b) USE OF UNEXPENDED FUNDS.—Any funds paid to an institu- tion and not expended or used for the purposes for which the funds were paid during the five-year period following the date of the ini- tial grant award, may be carried over and expended during the suc- ceeding five-year period, if such funds were obligated for a purpose for which the funds were paid during the five-year period following the date of the initial grant award.
PART C—ENDOWMENT CHALLENGE GRANTS FOR INSTITUTIONS ELIGIBLE FOR ASSISTANCE UNDER PART A OR PART B SEC.

331. ø20 U.S.C.

1065¿ ENDOWMENT CHALLENGE GRANTS.


(a) PURPOSE; DEFINITIONS.—(1) The purpose of this section is to establish a program to provide matching grants to eligible insti- tutions in order to establish or increase endowment funds at such institutions, to provide additional incentives to promote fund rais- ing activities by such institutions, and to foster increased independ- ence and self-sufficiency at such institutions.
(2) For the purpose of this section: (A) The term ‘‘endowment fund’’ means a fund established by State law, by an institution of higher education, or by a foundation which is exempt from taxation and is maintained for the purpose of generating income for the support of the in- stitution, but which shall not include real estate.
(B) The term ‘‘endowment fund corpus’’ means an amount equal to the grant or grants awarded under this section plus an amount equal to such grant or grants provided by the insti- tution.

(C) The term ‘‘endowment fund income’’ means an amount equal to the total value of the endowment fund established under this section minus the endowment fund corpus.
(D)(i) The term ‘‘eligible institution’’ means an institution that is an— (I) eligible institution under part A or would be consid- ered to be such an institution if section 312(b)(1)(C) re- ferred to a postgraduate degree rather than a bachelor’s degree; (II) institution eligible for assistance under part B or would be considered to be such an institution if section 324 referred to a postgraduate degree rather than a bacca- laureate degree; or (III) institution of higher education that makes a sub- stantial contribution to postgraduate medical educational September 8, 2023 As Amended Through P.L.
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331 opportunities for minorities and the economically dis- advantaged.
(ii) The Secretary may waive the requirements of sub- clauses (I) and (II) of clause (i) with respect to a postgraduate degree in the case of any institution otherwise eligible under clause (i) for an endowment challenge grant upon determining that the institution makes a substantial contribution to med- ical education opportunities for minorities and the economi- cally disadvantaged.
(b) GRANTS AUTHORIZED.—(1) From sums available for this sec- tion under section 399, the Secretary is authorized to award en- dowment challenge grants to eligible institutions to establish or in- crease an endowment fund at such institution.

Such grants shall be made only to eligible institutions described in paragraph (4) whose applications have been approved pursuant to subsection (g).
(2)(A) Except as provided in subparagraph (B), no institution shall receive a grant under this section, unless such institution has deposited in its endowment fund established under this section an amount equal to the amount of such grant.

The source of funds for this institutional match shall not include Federal funds or funds from an existing endowment fund.
(B) The Secretary may make a grant under this part to an eli- gible institution in any fiscal year if the institution— (i) applies for a grant in an amount not exceeding $1,000,000; and (ii) has deposited in the eligible institution’s endowment fund established under this section an amount which is equal to 1⁄2 of the amount of such grant.
(C) An eligible institution of higher education that is awarded a grant under subparagraph (B) shall not be eligible to receive an additional grant under subparagraph (B) until 10 years after the date on which the grant period terminates.

(3) The period of a grant under this section shall be not more than 20 years.

During the grant period, an institution may not withdraw or expend any of the endowment fund corpus.
After the termination of the grant period, an institution may use the endow- ment fund corpus plus any endowment fund income for any edu- cational purpose.

(4)(A) An institution of higher education is eligible to receive a grant under this section if it is an eligible institution as described in subsection (a)(2)(D) of this section.
(B) No institution shall be ineligible for an endowment chal- lenge grant under this section for a fiscal year by reason of the pre- vious receipt of such a grant but no institution shall be eligible to receive such a grant for more than 2 fiscal years out of any period of 5 consecutive fiscal years.

(5) An endowment challenge grant awarded under this section to an eligible institution shall be in an amount which is not less than $100,000 in any fiscal year.
(6)(A) An eligible institution may designate a foundation, which was established for the purpose of raising money for the in- stitution, as the recipient of the grant awarded under this section.

(B) The Secretary shall not award a grant to a foundation on behalf of an institution unless— September 8, 2023 As Amended Through P.L.
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331 HIGHER EDUCATION ACT OF 1965 154 (i) the institution assures the Secretary that the founda- tion is legally authorized to receive the endowment fund corpus and is legally authorized to administer the fund in accordance with this section and any implementing regulation; (ii) the foundation agrees to administer the fund in accord- ance with the requirements of this section and any imple- menting regulation; and (iii) the institution agrees to be liable for any violation by the foundation of the provisions of this section and any imple- menting regulation, including any monetary liability that may arise as a result of such violation.
(c) GRANT AGREEMENT; ENDOWMENT FUND PROVISIONS.—(1) An institution awarded a grant under this section shall enter into an agreement with the Secretary containing satisfactory assur- ances that it will (A) immediately comply with the matching re- quirements of subsection (b)(2), (B) establish an endowment fund independent of any other such fund of the institution, (C) invest the endowment fund corpus, and (D) meet the other requirements of this section.
(2)(A) An institution shall invest the endowment fund corpus and endowment fund income in low-risk securities in which a regu- lated insurance company may invest under the law of the State in which the institution is located such as a federally insured bank savings account or comparable interest-bearing account, certificate of deposit, money market fund, mutual fund, or obligations of the United States.
(B) The institution, in investing the endowment fund estab- lished under this section, shall exercise the judgment and care, under the circumstances then prevailing, which a person of pru- dence, discretion, and intelligence would exercise in the manage- ment of such person’s own affairs.
(3)(A) An institution may withdraw and expend the endow- ment fund income to defray any expenses necessary to the oper- ation of such college, including expenses of operations and mainte- nance, administration, academic and support personnel, construc- tion and renovation, community and student services programs, and technical assistance.
(B)(i) Except as provided in clause (ii), an institution may not spend more than 50 percent of the total aggregate endowment fund income earned prior to the time of expenditure.
(ii) The Secretary may permit an institution to spend more than 50 percent of the endowment fund income notwithstanding clause (i) if the institution demonstrates such an expenditure is necessary because of (I) a financial emergency, such as a pending insolvency or temporary liquidity problem; (II) a life-threatening situation occasioned by a natural disaster or arson; or (III) any other unusual occurrence or exigent circumstance.
(d) REPAYMENT PROVISIONS.—(1) If at any time an institution withdraws part of the endowment fund corpus, the institution shall repay to the Secretary an amount equal to 50 percent of the with- drawn amount, which represents the Federal share, plus income earned thereon.

The Secretary may use such repaid funds to make additional challenge grants, or to increase existing endowment grants, to other eligible institutions.

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331 (2) If an institution expends more of the endowment fund in- come than is permitted under subsection (c), the institution shall repay the Secretary an amount equal to 50 percent of the amount improperly expended (representing the Federal share thereof).

The Secretary may use such repaid fund to make additional challenge grants, or to increase existing challenge grants, to other eligible in- stitutions.
(e) AUDIT INFORMATION.—An institution receiving a grant under this section shall provide to the Secretary (or a designee thereof) such information (or access thereto) as may be necessary to audit or examine expenditures made from the endowment fund corpus or income in order to determine compliance with this sec- tion.
(f) SELECTION CRITERIA.—In selecting eligible institutions for grants under this section for any fiscal year, the Secretary shall— (1) give priority to an applicant that is receiving assistance under part A or part B or has received a grant under part A or part B of this title within the 5 fiscal years preceding the fiscal year in which the applicant is applying for a grant under this section; (2) give priority to an applicant with a greater need for such a grant, based on the current market value of the appli- cant’s existing endowment in relation to the number of full- time equivalent students enrolled at such institution; and (3) consider— (A) the effort made by the applicant to build or main- tain its existing endowment fund; and (B) the degree to which an applicant proposes to match the grant with nongovernmental funds.
(g) APPLICATION.—Any institution which is eligible for assist- ance under this section may submit to the Secretary a grant appli- cation at such time, in such form, and containing such information as the Secretary may prescribe, including a description of the long- and short-term plans for raising and using the funds under this part.
Subject to the availability of appropriations to carry out this section and consistent with the requirement of subsection (f), the Secretary may approve an application for a grant if an institution, in its application, provides adequate assurances that it will comply with the requirements of this section.
(h) TERMINATION AND RECOVERY PROVISIONS.—(1) After notice and an opportunity for a hearing, the Secretary may terminate and recover a grant awarded under this section if the grantee institution— (A) expends portions of the endowment fund corpus or ex- pends more than the permissible amount of the endowment funds income as prescribed in subsection (c)(3); (B) fails to invest the endowment fund in accordance with the investment standards set forth in subsection (c)(2); or (C) fails to properly account to the Secretary concerning the investment and expenditures of the endowment funds.
(2) If the Secretary terminates a grant under paragraph (1), the grantee shall return to the Secretary an amount equal to the sum of each original grant under this section plus income earned thereon.

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341 HIGHER EDUCATION ACT OF 1965 156 tional endowment grants, or to increase existing challenge grants, to other eligible institutions under this part.

(i) TECHNICAL ASSISTANCE.—The Secretary, directly or by grant or contract, may provide technical assistance to eligible institutions to prepare the institutions to qualify, apply for, and maintain a grant, under this section.

PART D—HISTORICALLY BLACK COLLEGE AND UNIVERSITY CAPITAL FINANCING SEC.

341. ø20 U.S.C.

1066¿ FINDINGS.
The Congress finds that— (1) a significant part of the Federal mission in education has been to attain equal opportunity in higher education for low-income, educationally disadvantaged Americans and Afri- can Americans; (2) the Nation’s historically Black colleges and universities have played a prominent role in American history and have an unparalleled record of fostering the development of African American youth by recognizing their potential, enhancing their academic and technical skills, and honing their social and po- litical skills through higher education; (3) the academic and residential facilities on the campuses of all historically Black colleges and universities have suffered from neglect, deferred maintenance and are in need of capital improvements in order to provide appropriate settings for learning and social development through higher education; (4) due to their small enrollments, limited endowments and other financial factors normally considered by lenders in construction financing, historically Black colleges and univer- sities often lack access to the sources of funding necessary to undertake the necessary capital improvements through bor- rowing and bond financing; (5) despite their track record of long-standing and remark- able institutional longevity and viability, historically Black col- leges and universities often lack the financial resources nec- essary to gain access to traditional sources of capital financing such as bank loans and bond financing; and (6) Federal assistance to facilitate low-cost capital basis for historically Black colleges and universities will enable such col- leges and universities to continue and expand their educational mission and enhance their significant role in American higher education.
SEC.

342. ø20 U.S.C.

1066a¿ DEFINITIONS.

For the purposes of this part: (1) The term ‘‘eligible institution’’ means a ‘‘part B institu- tion’’ as that term is defined in section 322(2) of the Higher Education Act of 1965 (20 U.S.C.

1061(2)).

(2) The term ‘‘loan’’ means a loan made to an eligible insti- tution under the provisions of this part and pursuant to an agreement with the Secretary.
(3) The term ‘‘qualified bond’’ means any obligation issued by the designated bonding authority at the direction of the Sec- September 8, 2023 As Amended Through P.L.

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342 retary, the net proceeds of which are loaned to an eligible insti- tution for the purposes described in section 343(b).

(4) The term ‘‘funding’’ means any payment under this part from the Secretary to the eligible institution or its as- signee in fulfillment of the insurance obligations of the Sec- retary pursuant to an agreement under section 343.
(5) The term ‘‘capital project’’ means, subject to section 344(b), the repair, renovation, or, in exceptional circumstances, the construction or acquisition, of— (A) any classroom facility, library, laboratory facility, dormitory (including dining facilities) or other facility cus- tomarily used by colleges and universities for instructional or research purposes or for housing students, faculty, and staff; (B) a facility for the administration of an educational program, or a student center or student union, except that not more than 5 percent of the loan proceeds provided under this part may be used for the facility, center or union if the facility, center or union is owned, leased, man- aged, or operated by a private business, that, in return for such use, makes a payment to the eligible institution; (C) instructional equipment, technology, research in- strumentation, and any capital equipment or fixture re- lated to facilities described in subparagraph (A); (D) a maintenance, storage, or utility facility that is essential to the operation of a facility, a library, a dor- mitory, equipment, instrumentation, a fixture, real prop- erty or an interest therein, described in this paragraph; (E) a facility designed to provide primarily outpatient health care for students or faculty; (F) physical infrastructure essential to support the projects authorized under this paragraph, including roads, sewer and drainage systems, and water, power, lighting, telecommunications, and other utilities; (G) any other facility, equipment or fixture which is essential to the maintaining of accreditation of the mem- ber institution by an accrediting agency or association rec- ognized by the Secretary under subpart 2 of part H of title IV; and (H) any real property or interest therein underlying facilities described in subparagraph (A) or (G).
(6) The term ‘‘interest’’ includes accredited value or any other payment constituting interest on an obligation.

(7) The term ‘‘outstanding’’, when used with respect to bonds, shall not include bonds the payment of which shall have been provided for by the irrevocable deposit in trust of obliga- tions maturing as to principal and interest in such amounts and at such times as will ensure the availability of sufficient moneys to make payments on such bonds.
(8) The term ‘‘designated bonding authority’’ means the private, for-profit corporation selected by the Secretary pursu- ant to section 345(1) for the purpose of issuing taxable capital project construction bonds in furtherance of the purposes of this part.

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343 HIGHER EDUCATION ACT OF 1965 158 (9) The term ‘‘Advisory Board’’ means the Advisory Board established by section 347 of this part.

SEC.

343. ø20 U.S.C.

1066b¿ FEDERAL INSURANCE FOR BONDS.

(a) GENERAL RULE.—Subject to the limitations in section 344, the Secretary is authorized to enter into insurance agreements to provide financial insurance to guarantee the full payment of prin- cipal and interest on qualified bonds upon the conditions set forth in subsections (b), (c) and (d).
(b) RESPONSIBILITIES OF THE DESIGNATED BONDING AUTHOR- ITY.—The Secretary may not enter into an insurance agreement de- scribed in subsection (a) unless the Secretary designates a qualified bonding authority in accordance with sections 345(1) and 346 and the designated bonding authority agrees in such agreement to— (1) use the proceeds of the qualified bonds, less costs of issuance not to exceed 2 percent of the principal amount there- of, to make loans to eligible institutions or for deposit into an escrow account for repayment of the bonds; (2) provide in each loan agreement with respect to a loan that not less than 95 percent of the proceeds of the loan will be used— (A) to finance the repair, renovation, and, in excep- tional cases, construction or acquisition, of a capital project; or (B) to refinance an obligation the proceeds of which were used to finance the repair, renovation, and, in excep- tional cases, construction or acquisition, of a capital project; (3)(A) charge such interest on loans, and provide for such a schedule of repayments of loans, as will, upon the timely re- payment of the loans, provide adequate and timely funds for the payment of principal and interest on the bonds; and (B) require that any payment on a loan expected to be nec- essary to make a payment of principal and interest on the bonds be due not less than 60 days prior to the date of the pay- ment on the bonds for which such loan payment is expected to be needed; (4) prior to the making of any loan, provide for a credit re- view of the institution receiving the loan and assure the Sec- retary that, on the basis of such credit review, it is reasonable to anticipate that the institution receiving the loan will be able to repay the loan in a timely manner pursuant to the terms thereof; (5) provide in each loan agreement with respect to a loan that, if a delinquency on such loan results in a funding under the insurance agreement, the institution obligated on such loan shall repay the Secretary, upon terms to be determined by the Secretary, for such funding; (6) assign any loans to the Secretary, upon the demand of the Secretary, if a delinquency on such loan has required a funding under the insurance agreement; (7) in the event of a delinquency on a loan, engage in such collection efforts as the Secretary shall require for a period of September 8, 2023 As Amended Through P.L.
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343 not less than 45 days prior to requesting a funding under the insurance agreement; (8) establish an escrow account— (A) into which each eligible institution shall deposit 5 percent of the proceeds of any loan made under this part, with each eligible institution required to maintain in the escrow account an amount equal to 5 percent of the out- standing principal of all loans made to such institution under this part; and (B) the balance of which— (i) shall be available to the Secretary to pay prin- cipal and interest on the bonds in the event of delin- quency in loan repayment; and (ii) shall be used to return to an eligible institu- tion an amount equal to any remaining portion of such institution’s 5 percent deposit of loan proceeds within 120 days following scheduled repayment of such insti- tution’s loan; (9) provide in each loan agreement with respect to a loan that, if a delinquency on such loan results in amounts being withdrawn from the escrow account to pay principal and inter- est on bonds, subsequent payments on such loan shall be avail- able to replenish such escrow account; (10) comply with the limitations set forth in section 344 of this part; (11) make loans only to eligible institutions under this part in accordance with conditions prescribed by the Secretary to ensure that loans are fairly allocated among as many eligible institutions as possible, consistent with making loans of amounts that will permit capital projects of sufficient size and scope to significantly contribute to the educational program of the eligible institutions; and (12) limit loan collateralization, with respect to any loan made under this part, to 100 percent of the loan amount, ex- cept as otherwise required by the Secretary.
(c) ADDITIONAL AGREEMENT PROVISIONS.—Any insurance agreement described in subsection (a) of this section shall provide as follows: (1) The payment of principal and interest on bonds shall be insured by the Secretary until such time as such bonds have been retired or canceled.

(2) The Federal liability for delinquencies and default for bonds guaranteed under this part shall only become effective upon the exhaustion of all the funds held in the escrow account described in subsection (b)(8).
(3) The Secretary shall create a letter of credit authorizing the Department of the Treasury to disburse funds to the des- ignated bonding authority or its assignee.
(4) The letter of credit shall be drawn upon in the amount determined by paragraph (5) of this subsection upon the certifi- cation of the designated bonding authority to the Secretary or the Secretary’s designee that there is a delinquency on 1 or more loans and there are insufficient funds available from loan September 8, 2023 As Amended Through P.L.
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344 HIGHER EDUCATION ACT OF 1965 160 repayments and the escrow account to make a scheduled pay- ment of principal and interest on the bonds.
(5) Upon receipt by the Secretary or the Secretary’s des- ignee of the certification described in paragraph (4) of this sub- section, the designated bonding authority may draw a funding under the letter of credit in an amount equal to— (A) the amount required to make the next scheduled payment of principal and interest on the bonds, less (B) the amount available to the designated bonding authority from loan repayments and the escrow account.
(6) All funds provided under the letter of credit shall be paid to the designated bonding authority within 2 business days following receipt of the certification described in para- graph (4).

(d) FULL FAITH AND CREDIT PROVISIONS.—Subject to section 343(c)(1) the full faith and credit of the United States is pledged to the payment of all funds which may be required to be paid under the provisions of this section.
(e) SALE OF QUALIFIED BONDS.—Notwithstanding any other provision of law, a qualified bond guaranteed under this part may be sold to any party that offers terms that the Secretary deter- mines are in the best interest of the eligible institution.

SEC.

344. ø20 U.S.C.

1066c¿ LIMITATIONS ON FEDERAL INSURANCE FOR BONDS ISSUED BY THE DESIGNATED BONDING AUTHOR- ITY.
(a) LIMIT ON AMOUNT.—At no time shall the aggregate prin- cipal amount of outstanding bonds insured under this part together with any accrued unpaid interest thereon exceed $1,100,000,000, of which— (1) not more than $733,333,333 shall be used for loans to eligible institutions that are private historically Black colleges and universities; and (2) not more than $366,666,667 shall be used for loans to eligible institutions which are historically Black public colleges and universities.
For purposes of paragraphs (1) and (2), Lincoln University of Penn- sylvania is an historically Black public institution.

No institution of higher education that has received assistance under section 8 of the Act of March 2, 1867 (20 U.S.C.

123) shall be eligible to receive assistance under this part.

(b) LIMITATION ON CREDIT AUTHORITY.—The authority of the Secretary to issue letters of credit and insurance under this part is effective only to the extent provided in advance by appropria- tions Acts.
(c) RELIGIOUS ACTIVITY PROHIBITION.—No loan may be made under this part for any educational program, activity or service re- lated to sectarian instruction or religious worship or provided by a school or department of divinity or to an institution in which a sub- stantial portion of its functions is subsumed in a religious mission.
(d) DISCRIMINATION PROHIBITION.—No loan may be made to an institution under this part if the institution discriminates on ac- count of race, color, religion, national origin, sex (to the extent pro- vided in title IX of the Education Amendments of 1972), or dis- abling condition; except that the prohibition with respect to religion September 8, 2023 As Amended Through P.L.
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345 shall not apply to an institution which is controlled by or which is closely identified with the tenets of a particular religious organiza- tion if the application of this section would not be consistent with the religious tenets of such organization.

SEC.
SEC.

345. ø20 U.S.C.

1066d¿ AUTHORITY OF THE SECRETARY.
In the performance of, and with respect to, the functions vested in the Secretary by this part, the Secretary— (1) shall, within 120 days of the date of enactment of the Higher Education Opportunity Act, publish in the Federal Reg- ister a notice and request for proposals for any private for-prof- it organization or entity wishing to serve as the designated bonding authority under this part, which notice shall— (A) specify the time and manner for submission of pro- posals; and (B) specify any information, qualifications, criteria, or standards the Secretary determines to be necessary to evaluate the financial capacity and administrative capa- bility of any applicant to carry out the responsibilities of the designated bonding authority under this part; (2) shall ensure that— (A) the selection process for the designated bonding authority is conducted on a competitive basis; and (B) the evaluation and selection process is trans- parent; (3) shall— (A) review the performance of the designated bonding authority after the third year of the insurance agreement; and (B) following the review described in subparagraph (A), implement a revised competitive selection process, if determined necessary by the Secretary in consultation with the Advisory Board established pursuant to section 347; (4) shall require that the first loans for capital projects au- thorized under section 343 be made no later than March 31, 1994; (5) may sue and be sued in any court of record of a State having general jurisdiction or in any district court of the United States, and such district courts shall have jurisdiction of civil actions arising under this part without regard to the amount in controversy, and any action instituted under this part without regard to the amount in controversy, and any ac- tion instituted under this section by or against the Secretary shall survive notwithstanding any change in the person occu- pying the office of the Secretary or any vacancy in such office; (6)(A) may foreclose on any property and bid for and pur- chase at any foreclosure, or any other sale, any property in connection with which the Secretary has been assigned a loan pursuant to this part; and (B) in the event of such an acquisition, notwithstanding any other provisions of law relating to the acquisition, han- dling, or disposal of real property by the United States, com- September 8, 2023 As Amended Through P.L.
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347 HIGHER EDUCATION ACT OF 1965 162 plete, administer, remodel and convert, dispose of, lease, and otherwise deal with, such property, except that— (i) such action shall not preclude any other action by the Secretary to recover any deficiency in the amount of a loan assigned to the Secretary; and (ii) any such acquisition of real property shall not de- prive any State or political subdivision thereof of its civil or criminal jurisdiction in and over such property or im- pair the civil rights under the State or local laws of the in- habitants on such property; (7) may sell, exchange, or lease real or personal property and securities or obligations; (8) may include in any contract such other covenants, con- ditions, or provisions necessary to ensure that the purposes of this part will be achieved; (9) may, directly or by grant or contract, provide technical assistance to eligible institutions to prepare the institutions to qualify, apply for, and maintain a capital improvement loan, including a loan under this part; and (10) not later than 120 days after the date of enactment of the Higher Education Opportunity Act, shall submit to the authorizing committees a report on the progress of the Depart- ment in implementing the recommendations made by the Gov- ernment Accountability Office in October 2006 for improving the Historically Black College and Universities Capital Financ- ing Program.
øSection 346 repealed by section 306(d) of P.L.

105–244.¿ SEC.

347. ø20 U.S.C.

1066f¿ HBCU CAPITAL FINANCING ADVISORY BOARD.
(a) ESTABLISHMENT AND PURPOSE.—There is established within the Department of Education, the Historically Black College and Universities Capital Financing Advisory Board (hereinafter in this part referred to as the ‘‘Advisory Board’’) which shall provide ad- vice and counsel to the Secretary and the designated bonding au- thority as to the most effective and efficient means of implementing construction financing on African American college campuses, and advise the Congress of the United States regarding the progress made in implementing this part.
The Advisory Board shall meet with the Secretary at least twice each year to advise him as to the capital needs of historically Black colleges and universities, how those needs can be met through the program authorized by this part, and what additional steps might be taken to improve the op- eration and implementation of the construction financing program.
(b) BOARD MEMBERSHIP.— (1) COMPOSITION.—The Advisory Board shall be appointed by the Secretary and shall be composed of 11 members as fol- lows: (A) The Secretary or the Secretary’s designee.

(B) Three members who are presidents of private his- torically Black colleges or universities.

(C) Three members who are presidents of public his- torically Black colleges or universities.

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348 (D) The president of the United Negro College Fund, Inc., or the president’s designee.

(E) The president of the National Association for Equal Opportunity in Higher Education, or the designee of the Association.
(F) The executive director of the White House Initia- tive on historically Black colleges and universities.

(G) The president of the Thurgood Marshall College Fund, or the designee of the president.
(2) TERMS.—The term of office of each member appointed under paragraphs (1)(B) and (1)(C) shall be 3 years, except that— (A) of the members first appointed pursuant to para- graphs (1)(B) and (1)(C), 2 shall be appointed for terms of 1 year, and 3 shall be appointed for terms of 2 years; (B) members appointed to fill a vacancy occurring be- fore the expiration of a term of a member shall be ap- pointed to serve the remainder of that term; and (C) a member may continue to serve after the expira- tion of a term until a successor is appointed.
(c) ADDITIONAL RECOMMENDATIONS FROM ADVISORY BOARD.— (1) IN GENERAL.—In addition to the responsibilities of the Advisory Board described in subsection (a), the Advisory Board shall advise the Secretary and the authorizing committees re- garding— (A) the fiscal status and strategic financial condition of not less than ten historically Black colleges and univer- sities that have— (i) obtained construction financing through the program under this part and seek additional financing or refinancing under such program; or (ii) applied for construction financing through the program under this part but have not received financ- ing under such program; and (B) the feasibility of reducing borrowing costs associ- ated with the program under this part, including reducing interest rates.
(2) REPORT.—Not later than six months after the date of enactment of theHigher Education Opportunity Act, the Advi- sory Board shall prepare and submit a report to the author- izing committees regarding the historically Black colleges and universities described in paragraph (1)(A) that includes admin- istrative and legislative recommendations for addressing the issues related to construction financing facing such historically Black colleges and universities.

SEC.

348. ø20 U.S.C.


1066g¿ MINORITY BUSINESS ENTERPRISE UTILIZA- TION.

In the performance of and with respect to the Secretary’s effec- tuation of his responsibilities under section 345(1) and to the max- imum extent feasible in the implementation of the purposes of this part, minority business persons, including bond underwriters and credit enhancers, bond counsel, marketers, accountants, advisors, construction contractors, and managers should be utilized.

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350 HIGHER EDUCATION ACT OF 1965 164 PART E—MINORITY SCIENCE AND ENGINEERING IMPROVEMENT PROGRAM SUBPART 1—MINORITY SCIENCE AND ENGINEERING IMPROVEMENT PROGRAM SEC.

350. ø20 U.S.C.

1067¿ FINDINGS.


Congress makes the following findings: (1) It is incumbent on the Federal Government to support the technological and economic competitiveness of the United States by improving and expanding the scientific and techno- logical capacity of the United States.

More and better prepared scientists, engineers, and technical experts are needed to im- prove and expand such capacity.
(2) As the Nation’s population becomes more diverse, it is important that the educational and training needs of all Amer- icans are met.

Underrepresentation of minorities in science and technological fields diminishes our Nation’s competitive- ness by impairing the quantity of well prepared scientists, en- gineers, and technical experts in these fields.
(3) Despite significant limitations in resources, minority institutions provide an important educational opportunity for minority students, particularly in science and engineering fields.

Aid to minority institutions is a good way to address the underrepresentation of minorities in science and technological fields.
(4) There is a strong Federal interest in improving science and engineering programs at minority institutions as such pro- grams lag behind in program offerings and in student enroll- ment compared to such programs at other institutions of high- er education.

SEC.

351. ø20 U.S.C.

1067a¿ PURPOSE; AUTHORITY.


(a) It is the purpose of this subpart to continue the authority of the Department to operate the Minority Institutions Science Im- provement Program created under section 3(a)(1) of the National Science Foundation Act of 1950 and transferred to the Department by section 303(a)(1) of the Department of Education Organization Act.
(b) The Secretary shall, in accordance with the provisions of this subpart, carry out a program of making grants to institutions of higher education that are designed to effect long-range improve- ment in science and engineering education at predominantly minor- ity institutions and to increase the participation of underrep- resented ethnic minorities, particularly minority women, in sci- entific and technological careers.

SEC.

352. ø20 U.S.C.

1067b¿ GRANT RECIPIENT SELECTION.


(a) ESTABLISHMENT OF CRITERIA.—Grants under this subpart shall be awarded on the basis of criteria established by the Sec- retary by regulations.

(b) PRIORITIES TO BE GIVEN IN CRITERIA.—In establishing cri- teria under subsection (a), the Secretary shall give priority to appli- cants which have not previously received funding from the Minor- ity Institutions Science Improvement Program and to previous September 8, 2023 As Amended Through P.L.
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353 grantees with a proven record of success, as well as to applications that contribute to achieving balance among projects with respect to geographic region, academic discipline, and project type.
(c) REQUIRED CRITERIA.—In establishing criteria under sub- section (a), the Secretary may consider the following selection cri- teria in making grants: (1) plan of operation; (2) quality of key personnel; (3) budget and cost effectiveness; (4) evaluation plan; (5) adequacy of resources; (6) identification of need for the project; (7) potential institutional impact of the project; (8) institutional commitment to the project; (9) expected outcomes; and (10) scientific and educational value of the proposed project.
SEC.

353. ø20 U.S.C.

1067c¿ USE OF FUNDS.

(a) TYPES OF GRANTS.—Funds appropriated to carry out this subpart may be made available as— (1) institutional grants (as defined in section 365(6)); (2) cooperative grants (as defined in section 365(7)); (3) design projects (as defined in section 365(8)); or (4) special projects (as defined in section 365(9)).
(b) AUTHORIZED USES FOR EACH TYPE OF GRANT.—(1) The au- thorized uses of funds made available as institutional grants in- clude (but are not limited to)— (A) faculty development programs; or (B) development of curriculum materials.
(2) The authorized uses of funds made available as cooperative grants include (but are not limited to)— (A) assisting institutions in sharing facilities and per- sonnel; (B) disseminating information about established programs in science and engineering; (C) supporting cooperative efforts to strengthen the insti- tutions’ science and engineering programs; or (D) carrying out a combination of any of the activities in subparagraphs (A) through (C).
(3) The authorized uses of funds made available as design projects include (but are not limited to)— (A) developing planning, management, and evaluation sys- tems; or (B) developing plans for initiating scientific research and for improving institutions’ capabilities for such activities.

Funds used for design project grants may not be used to pay more than 50 percent of the salaries during any academic year of faculty members involved in the project.
(4) The authorized uses of funds made available as special projects include (but are not limited to)— (A) advanced science seminars; (B) science faculty workshops and conferences; September 8, 2023 As Amended Through P.L.

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355 HIGHER EDUCATION ACT OF 1965 166 (C) faculty training to develop specific science research or education skills; (D) research in science education; (E) programs for visiting scientists; (F) preparation of films or audio-visual materials in science; (G) development of learning experiences in science beyond those normally available to minority undergraduate students; (H) development of pre-college enrichment activities in science; or (I) any other activities designed to address specific barriers to the entry of minorities into science.
Subpart 2—Programs in STEM Fields SEC.

355. ø20 U.S.C.

1067e¿ YES PARTNERSHIPS GRANT PROGRAM.
(a) GRANT PROGRAM AUTHORIZED.—Subject to the availability of appropriations to carry out this subpart, the Secretary shall make grants to eligible partnerships (as described in subsection (f)) to support the engagement of underrepresented minority youth and youth who are low-income individuals (as such term is defined in section 312) in science, technology, engineering, and mathematics learning through outreach and hands-on, experiential-based projects that encourage students in kindergarten through grade 12 who are underrepresented minority youth or low-income individ- uals to pursue careers in science, technology, engineering, and mathematics.
(b) MINIMUM GRANT AMOUNT.—A grant awarded to a partner- ship under this subpart shall be for an amount that is not less than $500,000.

(c) DURATION.—A grant awarded under this subpart shall be for a period of five years.

(d) NON-FEDERAL MATCHING SHARE REQUIRED.—A partnership receiving a grant under this subpart shall provide, from non-Fed- eral sources, in cash or in-kind, an amount equal to 50 percent of the costs of the project supported by such grant.
(e) DISTRIBUTION OF GRANTS.—In awarding grants under this subpart, the Secretary shall ensure that, to the maximum extent practicable, the projects funded under this subpart are located in diverse geographic regions of the United States.

(f) ELIGIBLE PARTNERSHIPS.—Notwithstanding the general eli- gibility provision in section 361, eligibility to receive grants under this subpart is limited to partnerships described in paragraph (5) of such section.

SEC.

356. ø20 U.S.C.


1067e–1¿ PROMOTION OF ENTRY INTO STEM FIELDS.

(a) AUTHORITY TO CONTRACT, SUBJECT TO APPROPRIATIONS.— The Secretary is authorized to enter into a contract with a firm with a demonstrated record of success in advertising to implement a campaign to expand the population of qualified individuals in science, technology, engineering, and mathematics fields (referred to in this section as ‘‘STEM fields’’) by encouraging young Ameri- cans to enter such fields.
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361 (b) DESIGN OF CAMPAIGN.—The campaign under this section shall be designed to enhance the image of education and profes- sions in the STEM fields and promote participation in the STEM fields, and may include— (1) monitoring trends in youths’ attitudes toward pursuing education and professions in the STEM fields and their propen- sity toward entering the STEM fields; (2) determining what factors contribute to encouraging and discouraging Americans from pursuing study in STEM fields and entering the STEM fields professionally; (3) determining what specific factors limit the participation of groups currently underrepresented in STEM fields, including Latinos, African-Americans, and women; and (4) drawing from the market research performed under this section and implementing an advertising campaign to en- courage young Americans to take up studies in STEM fields, beginning at an early age.
(c) REQUIRED COMPONENTS.—The campaign under this section shall— (1) include components that focus tailored messages on ap- propriate age groups, starting with elementary school students; and (2) link participation in the STEM fields to the concept of service to one’s country, so that young people will be encour- aged to enter the STEM fields in order fulfill the obligation to be of service to their country.
(d) PRIORITY.—The campaign under this section shall hold as a high priority making specific appeals to Hispanic Americans, Af- rican Americans, Native Americans, students with disabilities, and women, who are currently underrepresented in the STEM fields, in order to increase their numbers in the STEM fields, and shall tai- lor recruitment efforts to each specific group.
(e) USE OF VARIETY OF MEDIA.—The campaign under this sec- tion shall make use of a variety of media, with an emphasis on tel- evision advertising, to reach its intended audience.

(f) TEACHING.—The campaign under this section shall include a narrowly focused effort to attract current professionals in the STEM fields, through advertising in mediums likely to reach that specific group, into teaching in a STEM field in elementary schools and secondary schools.

SEC.

357. ø20 U.S.C.


1067e–2¿ EVALUATION AND ACCOUNTABILITY PLAN.

The Secretary shall develop an evaluation and accountability plan for projects funded under this subpart.

Such plan shall in- clude, if the Secretary determines that it is practical, an objective measure of the impact of such projects, such as a measure of whether underrepresented minority student enrollment in courses related to science, technology, engineering, and mathematics in- creases at the secondary and postsecondary levels.
SUBPART 3—ADMINISTRATIVE AND GENERAL PROVISIONS SEC.

361. ø20 U.S.C.

1067g¿ ELIGIBILITY FOR GRANTS.

Eligibility to receive grants under this part is limited to— September 8, 2023 As Amended Through P.L.

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361 HIGHER EDUCATION ACT OF 1965 168 (1) public and private nonprofit institutions of higher edu- (A) award baccalaureate degrees; and (B) are minority institutions; (2) public or private nonprofit institutions of higher edu- cation that— cation that— (A) award associate degrees; and (B) are minority institutions that— (i) have a curriculum that includes science or engi- neering subjects; and (ii) enter into a partnership with public or private nonprofit institutions of higher education that award baccalaureate degrees in science and engineering; (3) 5 nonprofit science-oriented organizations, professional scientific societies, and institutions of higher education that award baccalaureate degrees, that— (A) provide a needed service to a group of minority in- stitutions; or (B) provide in-service training for project directors, sci- entists, and engineers from minority institutions; (4) consortia of organizations, that provide needed services to one or more minority institutions, the membership of which may include— (A) public and private nonprofit institutions of higher education which have a curriculum in science or engineer- ing; (B) institutions of higher education that have a grad- uate or professional program in science or engineering; (C) research laboratories of, or under contract with, the Department of Energy, the Department of Defense, or the National Institutes of Health; (D) relevant offices of the National Aeronautics and Space Administration, National Oceanic and Atmospheric Administration, National Science Foundation, and Na- tional Institute of Standards and Technology; (E) quasi-governmental entities that have a significant scientific or engineering mission; or (F) institutions of higher education that have State- sponsored centers for research in science, technology, engi- neering, and mathematics; or (5) only with respect to grants under subpart 2, partner- ships of organizations, the membership of which shall in- clude— (A) at least one institution of higher education eligible for assistance under this title or title V; (B) at least one high-need local educational agency (as defined in section 200); and (C) at least two community organizations or entities, such as businesses, professional associations, community- based organizations, philanthropic organizations, or State agencies.
5 This paragraph does not reflect amendments made by section 301(b) or 301(c)(9) of the High- er Education Amendments of 1998 (P.L.

105–244; 112 Stat.

1636) as those amendments were superseded by the amendment made by section 307(b) of that Act (112 Stat.

1636).

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365 SEC.

362. ø20 U.S.C.

1067h¿ GRANT APPLICATION.


(a) SUBMISSION AND CONTENTS OF APPLICATIONS.—An eligible applicant (as determined under section 361) that desires to receive a grant under this part shall submit to the Secretary an applica- tion therefor at such time or times, in such manner, and containing such information as the Secretary may prescribe by regulation.
Such application shall set forth— (1) a program of activities for carrying out one or more of the purposes described in section 351(b) in such detail as will enable the Secretary to determine the degree to which such program will accomplish such purpose or purposes; and (2) such other policies, procedures, and assurances as the Secretary may require by regulation.
(b) APPROVAL BASED ON LIKELIHOOD OF PROGRESS.—The Sec- retary shall approve an application only if the Secretary deter- mines that the application sets forth a program of activities which are likely to make substantial progress toward achieving the pur- poses of this part.

SEC.

363. ø20 U.S.C.

1067i¿ CROSS PROGRAM AND CROSS AGENCY CO- OPERATION.
The Minority Science and Engineering Improvement Programs shall cooperate and consult with other programs within the Depart- ment and within Federal, State, and private agencies which carry out programs to improve the quality of science, mathematics, and engineering education.

SEC.

364. ø20 U.S.C.

1067j¿ ADMINISTRATIVE PROVISIONS.


(a) TECHNICAL STAFF.—The Secretary shall appoint, without regard to the provisions of title 5 of the United States Code gov- erning appointments in the competitive service, not less than 2 technical employees with appropriate scientific and educational background to administer the programs under this part who may be paid without regard to the provisions of chapter 51 and sub- chapter III of chapter 53 of such title relating to classification and General Schedule pay rates.
(b) PROCEDURES FOR GRANT REVIEW.—The Secretary shall es- tablish procedures for reviewing and evaluating grants and con- tracts made or entered into under such programs.

Procedures for reviewing grant applications, based on the peer review system, or contracts for financial assistance under this title may not be sub- ject to any review outside of officials responsible for the adminis- tration of the Minority Science and Engineering Improvement Pro- grams.

SEC.

365. ø20 U.S.C.

1067k¿ DEFINITIONS.


For the purpose of this part— (1) The term ‘‘accredited’’ means currently certified by a nationally recognized accrediting agency or making satisfactory progress toward achieving accreditation.
(2) The term ‘‘minority’’ means American Indian, Alaskan Native, Black (not of Hispanic origin), Hispanic (including per- sons of Mexican, Puerto Rican, Cuban, and Central or South American origin), Pacific Islander or other ethnic group under- represented in science and engineering.

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365 HIGHER EDUCATION ACT OF 1965 170 (3) The term ‘‘minority institution’’ means an institution of higher education whose enrollment of a single minority or a combination of minorities (as defined in paragraph (2)) exceeds 50 percent of the total enrollment.
The Secretary shall verify this information from the data on enrollments in the higher education general information surveys (HEGIS) furnished by the institution to the Office for Civil Rights, Department of Education.
(4) The term ‘‘science’’ means, for the purpose of this pro- gram, the biological, engineering, mathematical, physical, be- havioral, and social sciences, and history and philosophy of science; also included are interdisciplinary fields which are comprised of overlapping areas among two or more sciences.
(5) The term ‘‘underrepresented in science and engineer- ing’’ means a minority group whose number of scientists and engineers per 10,000 population of that group is substantially below the comparable figure for scientists and engineers who are white and not of Hispanic origin.
(6) The term ‘‘institutional grant’’ means a grant that sup- ports the implementation of a comprehensive science improve- ment plan, which may include any combination of activities for improving the preparation of minority students for careers in science.

(7) The term ‘‘cooperative grant’’ means a grant that as- sists groups of nonprofit accredited colleges and universities to work together to conduct a science improvement program.
(8) The term ‘‘design projects’’ means projects that assist minority institutions that do not have their own appropriate resources or personnel to plan and develop long-range science improvement programs.
(9) The term ‘‘special projects’’ means— (A) a special project grant to a minority institution which supports activities that— (i) improve the quality of training in science and engineering at minority institutions; or (ii) enhance the minority institutions’ general sci- entific research capabilities; or (B) a special project grant to any eligible applicant which supports activities that— (i) provide a needed service to a group of eligible minority institutions; or (ii) provide in-service training for project directors, scientists, and engineers from eligible minority institu- tions.
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371 PART F—STRENGTHENING HISTORICALLY BLACK COLLEGES AND UNIVERSITIES AND OTHER MINORITY-SERVING INSTITUTIONS SEC.

371. ø20 U.S.C.
371. ø20 U.S.C.

1067q¿ INVESTMENT IN HISTORICALLY BLACK COL- LEGES AND UNIVERSITIES AND OTHER MINORITY-SERV- ING INSTITUTIONS.

(a) ELIGIBLE INSTITUTION.—An institution of higher education is eligible to receive funds from the amounts made available under this section if such institution is— (1) a part B institution (as defined in section 322 (20 U.S.C.

1061)); (2) a Hispanic-serving institution (as defined in section 502 (20 U.S.C.
1101a)); (3) a Tribal College or University (as defined in section 316 (20 U.S.C.

1059c)); (4) an Alaska Native-serving institution or a Native Ha- waiian-serving institution (as defined in section 317(b) (20 U.S.C.

1059d(b))); (5) a Predominantly Black Institution (as defined in sub- section (c)); (6) an Asian American and Native American Pacific Is- lander-serving institution (as defined in subsection (c)); or (7) a Native American-serving nontribal institution (as de- fined in subsection (c)).
(b) NEW INVESTMENT OF FUNDS.— (1) IN GENERAL.— (A) PROVISION OF FUNDS.—There shall be available to the Secretary to carry out this section, from funds in the Treasury not otherwise appropriated, $255,000,000 for fis- cal year 2020 and each fiscal year thereafter.

(B) AVAILABILITY.—Funds made available under sub- paragraph (A) for a fiscal year shall remain available for the next succeeding fiscal year.
(2) ALLOCATION AND ALLOTMENT.— (A) IN GENERAL.—Of the amounts made available under paragraph (1) for each fiscal year— (i) $100,000,000 shall be available for allocation under subparagraph (B); (ii) $100,000,000 shall be available for allocation under subparagraph (C); and (iii) $55,000,000 shall be available for allocation under subparagraph (D).
(B) HSI STEM AND ARTICULATION PROGRAMS.—The amount made available for allocation under this subpara- graph by subparagraph (A)(i) for any fiscal year shall be available for Hispanic-serving Institutions for activities de- scribed in section 503, with a priority given to applications that propose— (i) to increase the number of Hispanic and other low income students attaining degrees in the fields of science, technology, engineering, or mathematics; and September 8, 2023 As Amended Through P.L.
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371 HIGHER EDUCATION ACT OF 1965 172 (ii) to develop model transfer and articulation agreements between 2-year Hispanic-serving institu- tions and 4-year institutions in such fields.
(C) ALLOCATION AND ALLOTMENT HBCUS AND PBIS.— From the amount made available for allocation under this subparagraph by subparagraph (A)(ii) for any fiscal year— (i) 85 percent shall be available to eligible institu- tions described in subsection (a)(1) and shall be made available as grants under section 323 and allotted among such institutions under section 324, treating such amount, plus the amount appropriated for such fiscal year in a regular or supplemental appropriation Act to carry out part B of this title, as the amount ap- propriated to carry out part B of this title for purposes of allotments under section 324, for use by such insti- tutions with a priority for— (I) activities described in paragraphs (1), (2), (4), (5), and (10) of section 323(a); and (II) other activities, consistent with the insti- tution’s comprehensive plan and designed to in- crease the institution’s capacity to prepare stu- dents for careers in the physical or natural sciences, mathematics, computer science or infor- mation technology or sciences, engineering, lan- guage instruction in the less-commonly taught languages or international affairs, or nursing or allied health professions; and (ii) 15 percent shall be available to eligible institu- tions described in subsection (a)(5) and shall be avail- able for a competitive grant program to award 25 grants of $600,000 annually for programs in any of the following areas: (I) science, technology, engineering, or mathe- matics (STEM); (II) health education; (III) internationalization or globalization; (IV) teacher preparation; or (V) improving educational outcomes of African American males.
(D) ALLOCATION AND ALLOTMENT TO OTHER MINORITY- SERVING INSTITUTIONS.—From the amount made available for allocation under this subparagraph by subparagraph (A)(iii) for any fiscal year— (i) $30,000,000 for such fiscal year shall be avail- able to eligible institutions described in subsection (a)(3) and shall be made available as grants under sec- tion 316, treating such $30,000,000 as part of the amount appropriated for such fiscal year in a regular or supplemental appropriation Act to carry out such section, and using such $30,000,000 for purposes de- scribed in subsection (c) of such section; (ii) $15,000,000 for such fiscal year shall be avail- able to eligible institutions described in subsection (a)(4) and shall be made available as grants under sec- September 8, 2023 As Amended Through P.L.
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371 tion 317, treating such $15,000,000 as part of the amount appropriated for such fiscal year in a regular or supplemental appropriation Act to carry out such section and using such $15,000,000 for purposes de- scribed in subsection (c) of such section; (iii) $5,000,000 for such fiscal year shall be avail- able to eligible institutions described in subsection (a)(6) for activities described in section 311(c); and (iv) $5,000,000 for such fiscal year shall be avail- able to eligible institutions described in subsection (a)(7)— (I) to plan, develop, undertake, and carry out activities to improve and expand such institutions’ capacity to serve Native Americans, which may in- clude— (aa) the purchase, rental, or lease of sci- entific or for edu- laboratory equipment cational purposes, including instructional and research purposes; (bb) renovation and improvement in class- room, library, laboratory, and other instruc- tional facilities; (cc) support of faculty exchanges, faculty development, and faculty fellowships to assist faculty in attaining advanced degrees in the faculty’s field of instruction; (dd) curriculum development and aca- demic instruction; (ee) the purchase of library books, periodi- cals, microfilm, and other educational mate- rials; (ff) funds and administrative manage- ment, and acquisition of equipment for use in strengthening funds management; (gg) the joint use of facilities such as lab- oratories and libraries; and (hh) academic tutoring and counseling programs and student support services; and (II) to which the Secretary, to the extent pos- sible and consistent with a competitive process under which such grants are awarded, allocates funds under this clause to ensure maximum and equitable distribution among all such eligible in- stitutions.
(c) DEFINITIONS.— (1) ASIAN AMERICAN.—The term ‘‘Asian American’’ has the meaning given the term ‘‘Asian’’ in the Office of Management and Budget’s Standards for Maintaining, Collecting, and Pre- senting Federal Data on Race and Ethnicity as published on October 30, 1997 (62 Fed.

Reg.

58789).
Reg.

58789).

(2) ASIAN AMERICAN AND NATIVE AMERICAN PACIFIC IS- LANDER-SERVING INSTITUTION.—The term ‘‘Asian American and Native American Pacific Islander-serving institution’’ means an institution of higher education that— September 8, 2023 As Amended Through P.L.

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371 HIGHER EDUCATION ACT OF 1965 174 (A) is an eligible institution under section 312(b); and (B) at the time of application, has an enrollment of un- dergraduate students that is at least 10 percent Asian American and Native American Pacific Islander students.
(3) ENROLLMENT OF NEEDY STUDENTS.—The term ‘‘enroll- ment of needy students’’ means the enrollment at an institu- tion of higher education with respect to which not less than 50 percent of the undergraduate students enrolled in an academic program leading to a degree— (A) in the second fiscal year preceding the fiscal year for which the determination is made, were Federal Pell Grant recipients for such year; (B) come from families that receive benefits under a means-tested Federal benefit program (as defined in para- graph (5)); (C) attended a public or nonprofit private secondary school— (i) that is in the school district of a local edu- cational agency that was eligible for assistance under part A of title I of the Elementary and Secondary Edu- cation Act of 1965 for any year during which the stu- dent attended such secondary school; and (ii) which for the purpose of this paragraph and for that year was determined by the Secretary (pursu- ant to regulations and after consultation with the State educational agency of the State in which the school is located) to be a school in which the enroll- ment of children counted under a measure of poverty described in section 1113(a)(5) of such Act exceeds 30 percent of the total enrollment of such school; or (D) are first-generation college students (as that term is defined in section 402A(h)), and a majority of such first- generation college students are low-income individuals.
(4) LOW-INCOME INDIVIDUAL.—The term ‘‘low-income indi- vidual’’ has the meaning given such term in section 402A(h).

(5) MEANS-TESTED FEDERAL BENEFIT PROGRAM.—The term ‘‘means-tested Federal benefit program’’ means a program of the Federal Government, other than a program under title IV, in which eligibility for the programs’ benefits or the amount of such benefits are determined on the basis of income or re- sources of the individual or family seeking the benefit.
(6) NATIVE AMERICAN.—The term ‘‘Native American’’ means an individual who is of a tribe, people, or culture that is indigenous to the United States.

(7) NATIVE AMERICAN PACIFIC ISLANDER.—The term ‘‘Na- tive American Pacific Islander’’ means any descendant of the aboriginal people of any island in the Pacific Ocean that is a territory or possession of the United States.
(8) NATIVE AMERICAN-SERVING NONTRIBAL INSTITUTION.— ‘‘Native American-serving nontribal institution’’ The term means an institution of higher education that— (A) at the time of application— September 8, 2023 As Amended Through P.L.

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371 (i) has an enrollment of undergraduate students that is not less than 10 percent Native American stu- dents; and (ii) is not a Tribal College or University (as de- fined in section 316); and (B) submits to the Secretary such enrollment data as may be necessary to demonstrate that the institution is de- scribed in subparagraph (A), along with such other infor- mation and data as the Secretary may by regulation re- quire.
(9) PREDOMINANTLY BLACK INSTITUTION.—The term ‘‘Pre- dominantly Black institution’’ means an institution of higher education that— (A) has an enrollment of needy students as defined by paragraph (3); (B) has an average educational and general expendi- ture which is low, per full-time equivalent undergraduate student in comparison with the average educational and general expenditure per full-time equivalent under- graduate student of institutions of higher education that offer similar instruction, except that the Secretary may apply the waiver requirements described in section 392(b) to this subparagraph in the same manner as the Secretary applies the waiver requirements to section 312(b)(1)(B); (C) has an enrollment of undergraduate students— (i) that is at least 40 percent Black American stu- dents; (ii) that is at least 1,000 undergraduate students; (iii) of which not less than 50 percent of the un- dergraduate students enrolled at the institution are low-income individuals or first-generation college stu- dents (as that term is defined in section 402A(h)); and (iv) of which not less than 50 percent of the under- graduate students are enrolled in an educational pro- gram leading to a bachelor’s or associate’s degree that the institution is licensed to award by the State in which the institution is located; (D) is legally authorized to provide, and provides with- in the State, an educational program for which the institu- tion of higher education awards a bachelor’s degree, or in the case of a junior or community college, an associate’s degree; (E) is accredited by a nationally recognized accrediting agency or association determined by the Secretary to be a reliable authority as to the quality of training offered, or is, according to such an agency or association, making rea- sonable progress toward accreditation; and (F) is not receiving assistance under— (i) part B; (ii) part A of title V; or (iii) an annual authorization of appropriations under the Act of March 2, 1867 (14 Stat.
438; 20 U.S.C.

123).

September 8, 2023 As Amended Through P.L.

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391 HIGHER EDUCATION ACT OF 1965 176 PART G—GENERAL PROVISIONS SEC.

391. ø20 U.S.C.

1068¿ APPLICATIONS FOR ASSISTANCE.


(a) APPLICATIONS.— (1) APPLICATIONS REQUIRED.—Any institution which is eli- gible for assistance under this title shall submit to the Sec- retary an application for assistance at such time, in such form, and containing such information, as may be necessary to en- able the Secretary to evaluate the institution’s need for the as- sistance.
Subject to the availability of appropriations to carry out this title, the Secretary may approve an application for as- sistance under this title only if the Secretary determines that— (A) the application meets the requirements of sub- section (b); (B) the applicant is eligible for assistance in accord- ance with the part of this title under which the assistance is sought; and (C) the applicant’s performance goals are sufficiently rigorous as to meet the purposes of this title and the per- formance objectives and indicators for this title established by the Secretary pursuant to the Government Performance and Results Act of 1993 and the amendments made by such Act.
(2) PRELIMINARY APPLICATIONS.—In carrying out para- graph (1), the Secretary may develop a preliminary application for use by eligible institutions applying under part A prior to the submission of the principal application.
(b) CONTENTS.—An institution, in its application for a grant, shall— (1) set forth, or describe how the institution (other than an institution applying under part C, D or E) will develop, a com- prehensive development plan to strengthen the institution’s academic quality and institutional management, and otherwise provide for institutional self-sufficiency and growth (including measurable objectives for the institution and the Secretary to use in monitoring the effectiveness of activities under this title); (2) set forth policies and procedures to ensure that Federal funds made available under this title for any fiscal year will be used to supplement and, to the extent practical, increase the funds that would otherwise be made available for the purposes of section 311(b) or 323, and in no case supplant those funds; (3) set forth policies and procedures for evaluating the ef- fectiveness in accomplishing the purpose of the activities for which a grant is sought under this title; (4) provide for such fiscal control and fund accounting pro- cedures as may be necessary to ensure proper disbursement of and accounting for funds made available to the applicant under this title; (5) provide (A) for making such reports, in such form and containing such information, as the Secretary may require to carry out the functions under this title, including not less than one report annually setting forth the institution’s progress to- September 8, 2023 As Amended Through P.L.
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391 ward achieving the objectives for which the funds were award- ed, and (B) for keeping such records and affording such access thereto, as the Secretary may find necessary to assure the cor- rectness and verification of such reports; (6) provide that the institution will comply with the limita- tions set forth in section 396, except that for purposes of sec- tion 316, paragraphs (2) and (3) of section 396 shall not apply; (7) describe in a comprehensive manner any proposed project for which funds are sought under the application and include— (A) a description of the various components of the pro- posed project, including the estimated time required to complete each such component; (B) in the case of any development project which con- sists of several components (as described by the applicant pursuant to subparagraph (A)), a statement identifying those components which, if separately funded, would be sound investments of Federal funds and those components which would be sound investments of Federal funds only if funded under this title in conjunction with other parts of the development project (as specified by the applicant); (C) an evaluation by the applicant of the priority given any proposed project for which funds are sought in relation to any other projects for which funds are sought by the ap- plicant under this title, and a similar evaluation regarding priorities among the components of any single proposed project (as described by the applicant pursuant to subpara- graph (A)); (D) a detailed budget showing the manner in which funds for any proposed project would be spent by the appli- cant; and (E) a detailed description of any activity which in- volves the expenditure of more than $25,000, as identified in the budget referred to in subparagraph (D); and (8) include such other information as the Secretary may prescribe.
(c) PRIORITY CRITERIA PUBLICATION REQUIRED.—The Secretary shall publish in the Federal Register, pursuant to chapter 5 of title 5, United States Code, all policies and procedures required to exer- cise the authority set forth in subsection (a).

No other criteria, poli- cies, or procedures shall apply.
(d) ELIGIBILITY DATA.—The Secretary shall use the most recent and relevant data concerning the number and percentage of stu- dents receiving need-based assistance under title IV of this Act in making eligibility determinations under section 312 and shall ad- vance the base-year forward following each annual grant cycle.
(e) TECHNICAL ASSISTANCE.—The Secretary, directly or by grant or contract, may provide technical assistance to eligible insti- tutions to prepare the institutions to qualify, apply for, and main- tain a grant, under this title.

September 8, 2023 As Amended Through P.L.

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392 HIGHER EDUCATION ACT OF 1965 178 SEC.

392. ø20 U.S.C.

1068a¿ WAIVER AUTHORITY AND REPORTING RE- QUIREMENT.
(a) WAIVER REQUIREMENTS; NEED-BASED ASSISTANCE STU- DENTS.—The Secretary may waive the requirements set forth in section 312(b)(1)(A) in the case of an institution— (1) which is extensively subsidized by the State in which it is located and charges low or no tuition; (2) which serves a substantial number of low-income stu- dents as a percentage of its total student population; (3) which is contributing substantially to increasing higher education opportunities for educationally disadvantaged, underrepresented, or minority students, who are low-income individuals; (4) which is substantially increasing higher educational op- portunities for individuals in rural or other isolated areas which are unserved by postsecondary institutions; (5) located on or near an Indian reservation or a substan- tial population of Indians, if the Secretary determines that the waiver will substantially increase higher education opportuni- ties appropriate to the needs of American Indians; (6) that is a tribally controlled college or university as de- fined in section 2 of the Tribally Controlled Colleges and Uni- versities Assistance Act of 1978; or (7) wherever located, if the Secretary determines that the waiver will substantially increase higher education opportuni- ties appropriate to the needs of Black Americans, Hispanic Americans, Native Americans, Asian Americans, or Pacific Is- landers, including Native Hawaiians.
(b) WAIVER DETERMINATIONS; EXPENDITURES.—(1) The Sec- retary may waive the requirements set forth in section 312(b)(1)(B) if the Secretary determines, based on persuasive evidence sub- mitted by the institution, that the institution’s failure to meet that criterion is due to factors which, when used in the determination of compliance with such criterion, distort such determination, and that the institution’s designation as an eligible institution under part A is otherwise consistent with the purposes of such parts.
(2) The Secretary shall submit to the Congress every other year a report concerning the institutions which, although not satis- fying the criterion contained in section 312(b)(1)(B), have been de- termined to be eligible institutions under part A which enroll sig- nificant numbers of Black American, Hispanic, Native American, Asian American, or Native Hawaiian students under part A, as the case may be.
Such report shall— (A) identify the factors referred to in paragraph (1) which were considered by the Secretary as factors that distorted the determination of compliance with subparagraphs (A) and (B) of section 312(b)(1); and (B) contain a list of each institution determined to be an eligible institution under part A including a statement of the reasons for each such determination.
(3) The Secretary may waive the requirement set forth in sec- tion 312(b)(1)(E) in the case of an institution located on or near an Indian reservation or a substantial population of Indians, if the Secretary determines that the waiver will substantially increase September 8, 2023 As Amended Through P.L.
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392 higher education opportunities appropriate to the needs of Amer- ican Indians.
(c) WAIVER AUTHORITY WITH RESPECT TO INSTITUTIONS LO- CATED IN AN AREA AFFECTED BY A GULF HURRICANE DISASTER.— (1) WAIVER AUTHORITY.—Notwithstanding any other provi- sion of law, unless enacted with specific reference to this sec- tion, for any affected institution that was receiving assistance under this title at the time of a Gulf hurricane disaster, the Secretary shall, for each of the fiscal years 2009 through 2011 (and may, for each of the fiscal years 2012 and 2013)— (A) waive— (i) the eligibility data requirements set forth in section 391(d); (ii) the wait-out period set forth in section 313(d); (iii) the allotment requirements under section 324; and (iv) the use of the funding formula developed pur- suant to section 326(f)(3); (B) waive or modify any statutory or regulatory provi- sion to ensure that affected institutions that were receiv- ing assistance under this title at the time of a Gulf hurri- cane disaster are not adversely affected by any formula calculation for fiscal year 2009 or for any of the four suc- ceeding fiscal years, as necessary; and (C) make available to each affected institution an amount that is not less than the amount made available to such institution under this title for fiscal year 2006, ex- cept that for any fiscal year for which the funds appro- priated for payments under this title are less than the ap- propriated level for fiscal year 2006, the amount made available to such institutions shall be ratably reduced among the institutions receiving funds under this title.
(2) DEFINITIONS.—In this subsection: (A) AFFECTED INSTITUTION.—The term ‘‘affected insti- tution’’ means an institution of higher education that— (i) is— (I) a part A institution (which term shall have the meaning given the term ‘‘eligible institution’’ under section 312(b)); or (II) a part B institution, as such term is de- fined in section 322(2), or as identified in section 326(e); (ii) is located in an area affected by a Gulf hurri- cane disaster; and (iii) is able to demonstrate that, as a result of the impact of a Gulf hurricane disaster, the institution— (I) incurred physical damage; (II) has pursued collateral source compensa- tion from insurance, the Federal Emergency Man- agement Agency, and the Small Business Admin- istration, as appropriate; and (III) was not able to fully reopen in existing facilities or to fully reopen to the pre-hurricane September 8, 2023 As Amended Through P.L.
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393 HIGHER EDUCATION ACT OF 1965 180 enrollment levels during the 30-day period begin- ning on August 29, 2005.
(B) AREA AFFECTED BY A GULF HURRICANE DISASTER; GULF HURRICANE DISASTER.—The terms ‘‘area affected by a Gulf hurricane disaster’’ and ‘‘Gulf hurricane disaster’’ have the meanings given such terms in section 209 of the Higher Education Hurricane Relief Act of 2005 (Public Law 109–148, 119 Stat.

2809).

SEC.

393. ø20 U.S.C.

1068b¿ APPLICATION REVIEW PROCESS.


(a) REVIEW PANEL.—(1) All applications submitted under this title by institutions of higher education shall be read by a panel of readers composed of individuals selected by the Secretary.

The Sec- retary shall assure that no individual assigned under this section to review any application has any conflict of interest with regard to the application which might impair the impartiality with which the individual conducts the review under this section.
(2) The Secretary shall take care to assure that representatives of historically and predominantly Black colleges, Hispanic institu- tions, Tribal Colleges and Universities, and institutions with sub- stantial numbers of Hispanics, Native Americans, Asian Ameri- cans, and Native American Pacific Islanders (including Native Ha- waiians) are included as readers.
(3) All readers selected by the Secretary shall receive thorough instruction from the Secretary regarding the evaluation process for applications submitted under this title and consistent with the pro- visions of this title, including— (A) explanations and examples of the types of activities re- ferred to in section 311(b) that should receive special consider- ation for grants awarded under part A and of the types of ac- tivities referred to in section 323 that should receive special consideration for grants awarded under part B; (B) an enumeration of the factors to be used to determine the quality of applications submitted under this title; and (C) an enumeration of the factors to be used to determine whether a grant should be awarded for a project under this title, the amount of any such grant, and the duration of any such grant.
(b) RECOMMENDATIONS OF PANEL.—In awarding grants under this title, the Secretary shall take into consideration the rec- ommendations of the panel made under subsection (a).
(c) NOTIFICATION.—Not later than June 30 of each year, the Secretary shall notify each institution of higher education making an application under this title of— (1) the scores given the applicant by the panel pursuant to this section; (2) the recommendations of the panel with respect to such application; and (3) the reasons for the decision of the Secretary in award- ing or refusing to award a grant under this title, and any modifications, if any, in the recommendations of the panel made by the Secretary.
(d) EXCLUSION.—The provisions of this section shall not apply to applications submitted under part D. September 8, 2023 As Amended Through P.L.

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396 SEC.

394. ø20 U.S.C.

1068c¿ COOPERATIVE ARRANGEMENTS.
(a) GENERAL AUTHORITY.—The Secretary may make grants to encourage cooperative arrangements— (1) with funds available to carry out part A, between insti- tutions eligible for assistance under part A and between such institutions and institutions not receiving assistance under this title; or (2) with funds available to carry out part B, between insti- tutions eligible for assistance under part B and institutions not receiving assistance under this title; for the activities described in section 311(b) or section 323, as the case may be, so that the resources of the cooperating institutions might be combined and shared to achieve the purposes of such parts and avoid costly duplicative efforts and to enhance the devel- opment of part A and part B eligible institutions.
(b) PRIORITY.—The Secretary shall give priority to grants for the purposes described under subsection (a) whenever the Sec- retary determines that the cooperative arrangement is geographi- cally and economically sound or will benefit the applicant institu- tion.

(c) DURATION.—Grants to institutions having a cooperative ar- rangement may be made under this section for a period as deter- mined under section 313 or section 323.

SEC.

395. ø20 U.S.C.

1068d¿ ASSISTANCE TO INSTITUTIONS UNDER OTHER PROGRAMS.
(a) ASSISTANCE ELIGIBILITY.—Each institution which the Sec- retary determines to be an institution eligible under part A or an institution eligible under part B may be eligible for waivers in ac- cordance with subsection (b).
(b) WAIVER APPLICABILITY.—(1) Subject to, and in accordance with, regulations promulgated for the purpose of this section, in the case of any application by an institution referred to in subsection (a) for assistance under any programs specified in paragraph (2), the Secretary is authorized, if such application is otherwise approv- able, to waive any requirement for a non-Federal share of the cost of the program or project, or, to the extent not inconsistent with other law, to give, or require to be given, priority consideration of the application in relation to applications from other institutions.
(2) The provisions of this section shall apply to any program authorized by part D or title IV of this Act.

(c) LIMITATION.—The Secretary shall not waive, under sub- section (b), the non-Federal share requirement for any program for applications which, if approved, would require the expenditure of more than 10 percent of the appropriations for the program for any fiscal year.

SEC.

396. ø20 U.S.C.

1068e¿ LIMITATIONS.


The funds appropriated under section 399 may not be used— (1) for a school or department of divinity or any religious worship or sectarian activity; (2) for an activity that is inconsistent with a State plan for desegregation of higher education applicable to such institu- tion; September 8, 2023 As Amended Through P.L.
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397 HIGHER EDUCATION ACT OF 1965 182 (3) for an activity that is inconsistent with a State plan of higher education applicable to such institution; or (4) for purposes other than the purposes set forth in the approved application under which the funds were made avail- able to the institution.

SEC.
SEC.

397. ø20 U.S.C.

1068f¿ PENALTIES.

Whoever, being an officer, director, agent, or employee of, or connected in any capacity with, any recipient of Federal financial assistance or grant pursuant to this title embezzles, willfully misapplies, steals, or obtains by fraud any of the funds which are the subject of such grant or assistance, shall be fined not more than $10,000 or imprisoned for not more than 2 years, or both.

SEC.

398. ø20 U.S.C.

1068g¿ CONTINUATION AWARDS.


The Secretary shall make continuation awards under this title for the second and succeeding years of a grant only after deter- mining that the recipient is making satisfactory progress in car- rying out the grant.

SEC.

399. ø20 U.S.C.

1068h¿ AUTHORIZATIONS OF APPROPRIATIONS.


(a) AUTHORIZATIONS.— (1) PART A.—(A) There are authorized to be appropriated to carry out part A (other than sections 316 through 320), $135,000,000 for fiscal year 2009, and such sums as may be necessary for each of the five succeeding fiscal years.

(B) There are authorized to be appropriated to carry out section 316, $30,000,000 for fiscal year 2009, and such sums as may be necessary for each of the five succeeding fiscal years.
(C) There are authorized to be appropriated to carry out section 317, $15,000,000 for fiscal year 2009, and such sums as may be necessary for each of the five succeeding fiscal years.

(D) There are authorized to be appropriated to carry out section 318, $75,000,000 for fiscal year 2009 and each of the five succeeding fiscal years.
(E) There are authorized to be appropriated to carry out section 319, $25,000,000 for fiscal year 2009, and such sums as may be necessary for each of the five succeeding fiscal years.

(F) There are authorized to be appropriated to carry out section 320, $30,000,000 for fiscal year 2009, and such sums as may be necessary for each of the five succeeding fiscal years.
(2) PART B.—(A) There are authorized to be appropriated to carry out part B (other than section 326), $375,000,000 for fiscal year 2009, and such sums as may be necessary for each of the five succeeding fiscal years.

(B) There are authorized to be appropriated to carry out section 326, $125,000,000 for fiscal year 2009, and such sums as may be necessary for each of the five succeeding fiscal years.
(3) PART C.—There are authorized to be appropriated to carry out part C, $10,000,000 for fiscal year 2009, and such sums as may be necessary for each of the five succeeding fiscal years.

(4) PART D.—(A) There are authorized to be appropriated to carry out part D (other than section 345(9), but including September 8, 2023 As Amended Through P.L.
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401 section 347), $185,000 for fiscal year 2009, and such sums as may be necessary for each of the five succeeding fiscal years.
(B) There are authorized to be appropriated to carry out section 345(9) such sums as may be necessary for fiscal year 2009 and each of the five succeeding fiscal years.

(5) PART E.—(A) There are authorized to be appropriated to carry out subpart 1 of part E, $12,000,000 for fiscal year 2009, and such sums as may be necessary for each of the five succeeding fiscal years.
(B) There are authorized to be appropriated to carry out subpart 2 of part E, such sums as may be necessary for fiscal year 2009 and each of the five succeeding fiscal years.

(b) USE OF MULTIPLE YEAR AWARDS.—In the event of a mul- tiple year award to any institution under this title, the Secretary shall make funds available for such award from funds appropriated for this title for the fiscal year in which such funds are to be used by the recipient.
TITLE IV—STUDENT ASSISTANCE PART A—GRANTS TO STUDENTS IN ATTENDANCE AT INSTITUTIONS OF HIGHER EDUCATION SEC.

400. ø20 U.S.C.

1070¿ STATEMENT OF PURPOSE; PROGRAM AU- THORIZATION.
(a) PURPOSE.—It is the purpose of this part, to assist in mak- ing available the benefits of postsecondary education to eligible stu- dents (defined in accordance with section 484) in institutions of higher education by— (1) providing Federal Pell Grants to all eligible students; (2) providing supplemental educational opportunity grants to those students who demonstrate financial need; (3) providing for payments to the States to assist them in making financial aid available to such students; (4) providing for special programs and projects designed (A) to identify and encourage qualified youths with financial or cultural need with a potential for postsecondary education, (B) to prepare students from low-income families for postsecondary education, and (C) to provide remedial (including remedial lan- guage study) and other services to students; and (5) providing assistance to institutions of higher education.
(b) SECRETARY REQUIRED TO CARRY OUT PURPOSES.—The Sec- retary shall, in accordance with subparts 1 through 9, carry out programs to achieve the purposes of this part.

Subpart 1—Federal Pell Grants SEC.

401.

6 ø20 U.S.C.

1070a¿ FEDERAL PELL GRANTS: AMOUNT AND DE- TERMINATIONS; APPLICATIONS.
(a) PROGRAM AUTHORITY AND METHOD OF DISTRIBUTION.—(1) For each fiscal year through fiscal year 2017, the Secretary shall pay to each eligible institution such sums as may be necessary to 6 For a version of law of section 401, as amended by section 703 of division FF of Public Law 116–260, see note following this section.

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401 HIGHER EDUCATION ACT OF 1965 184 pay to each eligible student (defined in accordance with section 484) for each academic year during which that student is in attend- ance at an institution of higher education, as an undergraduate, a Federal Pell Grant in the amount for which that student is eligible, as determined pursuant to subsection (b).
Not less than 85 percent of such sums shall be advanced to eligible institutions prior to the start of each payment period and shall be based upon an amount requested by the institution as needed to pay eligible students until such time as the Secretary determines and publishes in the Federal Register with an opportunity for comment, an alternative payment system that provides payments to institutions in an accurate and timely manner, except that this sentence shall not be construed to limit the authority of the Secretary to place an institution on a re- imbursement system of payment.
(2) Nothing in this section shall be interpreted to prohibit the Secretary from paying directly to students, in advance of the begin- ning of the academic term, an amount for which they are eligible, in cases where the eligible institution elects not to participate in the disbursement system required by paragraph (1).

(3) Grants made under this subpart shall be known as ‘‘Federal Pell Grants’’.
(b) PURPOSE AND AMOUNT OF GRANTS.—(1) The purpose of this subpart is to provide a Federal Pell Grant that in combination with reasonable family and student contribution and supplemented by the programs authorized under subparts 3 and 4 of this part, will meet at least 75 percent of a student’s cost of attendance (as de- fined in section 472), unless the institution determines that a greater amount of assistance would better serve the purposes of this section.
(2) (A) 7 The amount of the Federal Pell Grant for a stu- dent eligible under this part shall be— (i) the maximum Federal Pell Grant, as specified in the last enacted appropriation Act applicable to that award year, plus (ii) the amount of the increase calculated under paragraph (7)(B) for that year, less (iii) an amount equal to the amount determined to be the expected family contribution with respect to that student for that year.
(B) In any case where a student attends an institution of high- er education on less than a full-time basis (including a student who attends an institution of higher education on less than a half-time basis) during any academic year, the amount of the Federal Pell Grant to which that student is entitled shall be reduced in propor- tion to the degree to which that student is not so attending on a full-time basis, in accordance with a schedule of reductions estab- lished by the Secretary for the purposes of this division, computed in accordance with this subpart.
Such schedule of reductions shall be established by regulation and published in the Federal Register in accordance with section 482 of this Act.

7 Margin so in law of subparagraph (A).

See amendment made by section 2101(a)(1) of Public Law 111–152.

Subparagraph (A) probably should have been run-in to paragraph (2) designation.

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401 (3) No Federal Pell Grant under this subpart shall exceed the difference between the expected family contribution for a student and the cost of attendance (as defined in section 472) at the institu- tion at which that student is in attendance.
If, with respect to any student, it is determined that the amount of a Federal Pell Grant plus the amount of the expected family contribution for that stu- dent exceeds the cost of attendance for that year, the amount of the Federal Pell Grant shall be reduced until the combination of ex- pected family contribution and the amount of the Federal Pell Grant does not exceed the cost of attendance at such institution.
(4) No Federal Pell Grant shall be awarded to a student under this subpart if the amount of that grant for that student as deter- mined under this subsection for any academic year is less than ten percent of the maximum amount of a Federal Pell Grant award de- termined under paragraph (2)(A) for such academic year.
(5) Notwithstanding any other provision of this subpart, the Secretary shall allow the amount of the Federal Pell Grant to be exceeded for students participating in a program of study abroad approved for credit by the institution at which the student is en- rolled when the reasonable costs of such program are greater than the cost of attendance at the student’s home institution, except that the amount of such Federal Pell Grant in any fiscal year shall not exceed the maximum amount of a Federal Pell Grant award deter- mined under paragraph (2)(A), for which a student is eligible dur- ing such award year.
If the preceding sentence applies, the finan- cial aid administrator at the home institution may use the cost of the study abroad program, rather than the home institution’s cost, to determine the cost of attendance of the student.
(6) 8 No Federal Pell Grant shall be awarded under this sub- part to any individual who is incarcerated in any Federal or State penal institution or who is subject to an involuntary civil commit- ment upon completion of a period of incarceration for a forcible or nonforcible sexual offense (as determined in accordance with the Federal Bureau of Investigation’s Uniform Crime Reporting Pro- gram).
(7) ADDITIONAL FUNDS.— (A) IN GENERAL.—There are authorized to be appro- priated, and there are appropriated (in addition to any other amounts appropriated to carry out this section and out of any money in the Treasury not otherwise appro- priated) the following amounts— (i) $2,030,000,000 for fiscal year 2008; (ii) $2,090,000,000 for fiscal year 2009; (iii) to carry out subparagraph (B) of this para- graph, such sums as may be necessary for fiscal year 2010 and each subsequent fiscal year to provide the 8 Paragraph (2) of section 702(n) of division FF of Public Law 116–260 provides as follows: ‘‘Notwithstanding section 701(b) of this Act, sections 401(b)(6) and 484(r) of the Higher Edu- cation Act of 1965 (20 U.S.C.
1070a(b)(6); 1091(r)) as in effect on the date of enactment of this Act, and section 12(f) of the Military Selective Service Act (50 U.S.C.

3811(f)), the Secretary of Education may implement the amendments made by paragraph (1) of this subsection before (but not later than) July 1, 2023.

The Secretary shall specify in a designation on what date, under what conditions, and for which award years the Secretary will implement such amendments prior to July 1, 2023.
The Secretary shall publish any designation under this paragraph in the Federal Register at least 60 days before implementation.’’.

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401 HIGHER EDUCATION ACT OF 1965 186 amount of increase of the maximum Federal Pell Grant required by clauses (ii) and (iii) of subparagraph (B); and (iv) to carry out this section— (I) $13,500,000,000 for fiscal year 2011; (II) $13,795,000,000 for fiscal year 2012; (III) $7,587,000,000 for fiscal year 2013; (IV) $588,000,000 for fiscal year 2014; (V) $0 for fiscal year 2015; (VI) $0 for fiscal year 2016; (VII) $1,320,000,000 for fiscal year 2017; (VIII) $1,334,000,000 for fiscal year 2018; (IX) $1,370,000,000 for fiscal year 2019; (X) $1,455,000,000 for fiscal year 2020; and (XI) $1,170,000,000 for fiscal year 2021 and each succeeding fiscal year.
(B) INCREASE IN FEDERAL PELL GRANTS.—The amounts made available pursuant to clauses (i) through (iii) of sub- paragraph (A) of this paragraph shall be used to increase the amount of the maximum Federal Pell Grant for which a student shall be eligible during an award year, as speci- fied in the last enacted appropriation Act applicable to that award year, by— (i) $490 for each of the award years 2008–2009 and 2009–2010; (ii) $690 for each of the award years 2010–2011, 2011–2012, and 2012–2013; and (iii) the amount determined under subparagraph (C) for each succeeding award year.
(C) ADJUSTMENT AMOUNTS.— (i) AWARD YEAR 2013–2014.—For award year 2013– 2014, the amount determined under this subpara- graph for purposes of subparagraph (B)(iii) shall be equal to— (I) $5,550 or the total maximum Federal Pell Grant for the preceding award year (as deter- mined under clause (iv)(II)), whichever is greater, increased by a percentage equal to the annual ad- justment percentage for award year 2013–2014, reduced by (II) $4,860 or the maximum Federal Pell Grant for which a student was eligible for the pre- ceding award year, as specified in the last enacted appropriation Act applicable to that year, which- ever is greater; and (III) rounded to the nearest $5.
(ii) AWARD YEARS 2014–2015 THROUGH 2017–2018.— For each of the award years 2014–2015 through 2017– 2018, the amount determined under this subpara- graph for purposes of subparagraph (B)(iii) shall be equal to— (I) the total maximum Federal Pell Grant for the preceding award year (as determined under clause (iv)(II)), increased by a percentage equal to September 8, 2023 As Amended Through P.L.
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401 the annual adjustment percentage for the award year for which the amount under this subpara- graph is being determined, reduced by (II) $4,860 or the maximum Federal Pell Grant for which a student was eligible for the pre- ceding award year, as specified in the last enacted appropriation Act applicable to that year, which- ever is greater; and (III) rounded to the nearest $5.
(iii) SUBSEQUENT AWARD YEARS.—For award year 2018–2019 and each subsequent award year, the amount determined under this subparagraph for pur- poses of subparagraph (B)(iii) shall be equal to the amount determined under clause (ii) for award year 2017–2018.
(iv) DEFINITIONS.—For purposes of this subpara- graph— (I) the term ‘‘annual adjustment percentage’’ as applied to an award year, is equal to the esti- mated percentage change in the Consumer Price Index (as determined by the Secretary, using the definition in section 478(f)) for the most recent calendar year ending prior to the beginning of that award year; and (II) the term ‘‘total maximum Federal Pell Grant’’ as applied to a preceding award year, is equal to the sum of— (aa) the maximum Federal Pell Grant for which a student is eligible during an award year, as specified in the last enacted appro- priation Act applicable to that preceding award year; and (bb) the amount of the increase in the maximum Federal Pell Grant required by this paragraph for that preceding award year.
(D) PROGRAM REQUIREMENTS AND OPERATIONS OTHER- WISE UNAFFECTED.—Except as provided in subparagraphs (B) and (C), nothing in this paragraph shall be construed to alter the requirements and operations of the Federal Pell Grant Program as authorized under this section, or authorize the imposition of additional requirements or op- erations for the determination and allocation of Federal Pell Grants under this section.
INCREASES DECREASES.—The amounts specified in subparagraph (B) shall be ratably in- creased or decreased to the extent that funds available under subparagraph (A) exceed or are less than (respec- tively) the amount required to provide the amounts speci- fied in subparagraph (B).
(E) RATABLE AND (F) AVAILABILITY OF FUNDS.—The amounts made available by subparagraph (A) for any fiscal year shall be available beginning on October 1 of that fiscal year, and shall remain available through September 30 of the suc- ceeding fiscal year.

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401 HIGHER EDUCATION ACT OF 1965 188 (8)(A) Effective in the 2017–2018 award year and there- after, the Secretary shall award an eligible student not more than one and one-half Federal Pell Grants during a single award year to permit such student to work toward completion of an eligible program if, during that single award year, the student— (i) has received a Federal Pell Grant for an award year and is enrolled in an eligible program for one or more additional payment periods during the same award year that are not otherwise fully covered by the student’s Federal Pell Grant; and (ii) is enrolled on at least a half-time basis while receiving any funds under this section.
(B) In the case of a student receiving more than one Federal Pell Grant in a single award year under subpara- graph (A), the total amount of Federal Pell Grants award- ed to such student for the award year may exceed the maximum basic grant level specified in the appropriate ap- propriations Act for such award year.

(C) Any period of study covered by a Federal Pell Grant awarded under subparagraph (A) shall be included in determining a student’s duration limit under subsection (c)(5).
(D) In any case where an eligible student is receiving a Federal Pell Grant for a payment period that spans two award years, the Secretary shall allow the eligible institu- tion in which the student is enrolled to determine the award year to which the additional period shall be as- signed, as it determines is most beneficial to students.
(c) PERIOD OF ELIGIBILITY FOR GRANTS.—(1) The period during which a student may receive Federal Pell Grants shall be the pe- riod required for the completion of the first undergraduate bacca- laureate course of study being pursued by that student at the insti- tution at which the student is in attendance except that any period during which the student is enrolled in a noncredit or remedial course of study as defined in paragraph (2) shall not be counted for the purpose of this paragraph.
(2) Nothing in this section shall exclude from eligibility courses of study which are noncredit or remedial in nature (including courses in English language instruction) which are determined by the institution to be necessary to help the student be prepared for the pursuit of a first undergraduate baccalaureate degree or certifi- cate or, in the case of courses in English language instruction, to be necessary to enable the student to utilize already existing knowledge, training, or skills.
Nothing in this section shall exclude from eligibility programs of study abroad that are approved for credit by the home institution at which the student is enrolled.

(3) No student is entitled to receive Pell Grant payments con- currently from more than one institution or from the Secretary and an institution.

(4) Notwithstanding paragraph (1), the Secretary may allow, on a case-by-case basis, a student to receive a basic grant if the student— September 8, 2023 As Amended Through P.L.
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401 (A) is carrying at least one-half the normal full-time work load for the course of study the student is pursuing, as deter- mined by the institution of higher education; and (B) is enrolled or accepted in a postbaccalaureate program that does not lead to a graduate de- gree, and in courses required by a State in order for the stu- dent to receive a professional certification or licensing creden- tial that is required for employment as a teacher in an elemen- tary school or secondary school in that State, for enrollment except that this paragraph shall not apply to a student who is en- rolled in an institution of higher education that offers a bacca- laureate degree in education.
(5) The period during which a student may receive Federal Pell Grants shall not exceed 12 semesters, or the equivalent of 12 se- mesters, as determined by the Secretary by regulation.

Such regu- lations shall provide, with respect to a student who received a Fed- eral Pell Grant for a term but was enrolled at a fraction of full- time, that only that same fraction of such semester or equivalent shall count towards such duration limits.
(d) APPLICATIONS FOR GRANTS.—(1) The Secretary shall from time to time set dates by which students shall file applications for Federal Pell Grants under this subpart.

(2) Each student desiring a Federal Pell Grant for any year shall file an application therefor containing such information and assurances as the Secretary may deem necessary to enable the Sec- retary to carry out the functions and responsibilities of this sub- part.
(e) DISTRIBUTION OF GRANTS TO STUDENTS.—Payments under this section shall be made in accordance with regulations promul- gated by the Secretary for such purpose, in such manner as will best accomplish the purpose of this section.

Any disbursement al- lowed to be made by crediting the student’s account shall be lim- ited to tuition and fees and, in the case of institutionally owned housing, room and board.
The student may elect to have the insti- tution provide other such goods and services by crediting the stu- dent’s account.
(f) CALCULATION OF ELIGIBILITY.—(1) Each contractor proc- essing applications for awards under this subpart (including a cen- tral processor, if any, designated by the Secretary) shall, in a time- ly manner, furnish to the student financial aid administrator (at each institution of higher education which a student awarded a Federal Pell Grant under this subpart is attending), as a part of its regular output document, the expected family contribution for each such student.
Each such student financial aid administrator shall— (A) examine and assess the data used to calculate the ex- pected family contribution of the student furnished pursuant to this subsection; (B) recalculate the expected family contribution of the stu- dent if there has been a change in circumstances of the student or in the data submitted; (C) make the award to the student in the correct amount; and September 8, 2023 As Amended Through P.L.
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401 HIGHER EDUCATION ACT OF 1965 190 (D) after making such award report the corrected data to such contractor and to a central processor (if any) designated by the Secretary for a confirmation of the correct computation of amount of the expected family contribution for each such student.
(2) Whenever a student receives an award under this subpart that, due to recalculation errors by the institution of higher edu- cation, is in excess of the amount which the student is entitled to receive under this subpart, such institution of higher education shall pay to the Secretary the amount of such excess unless such excess can be resolved in a subsequent disbursement to the institu- tion.
(3) Each contractor processing applications for awards under this subpart shall for each academic year after academic year 1986–1987 prepare and submit a report to the Secretary on the cor- rectness of the computations of amount of the expected family con- tribution, and on the accuracy of the questions on the application form under this subpart for the previous academic year for which the contractor is responsible.
The Secretary shall transmit the re- port, together with the comments and recommendations of the Sec- retary, to the Committee on Appropriations of the Senate, the Com- mittee on Appropriations of the House of Representatives, and the authorizing committees.
(g) INSUFFICIENT APPROPRIATIONS.—If, for any fiscal year, the funds appropriated for payments under this subpart are insuffi- cient to satisfy fully all entitlements, as calculated under sub- section (b) (but at the maximum grant level specified in such ap- propriation), the Secretary shall promptly transmit a notice of such insufficiency to each House of the Congress, and identify in such notice the additional amount that would be required to be appro- priated to satisfy fully all entitlements (as so calculated at such maximum grant level).
(h) USE OF EXCESS FUNDS.—(1) If, at the end of a fiscal year, the funds available for making payments under this subpart exceed the amount necessary to make the payments required under this subpart to eligible students by 15 percent or less, then all of the excess funds shall remain available for making payments under this subpart during the next succeeding fiscal year.
(2) If, at the end of a fiscal year, the funds available for mak- ing payments under this subpart exceed the amount necessary to make the payments required under this subpart to eligible stu- dents by more than 15 percent, then all of such funds shall remain available for making such payments but payments may be made under this paragraph only with respect to entitlements for that fis- cal year.
(i) TREATMENT OF INSTITUTIONS AND STUDENTS UNDER OTHER LAWS.—Any institution of higher education which enters into an agreement with the Secretary to disburse to students attending that institution the amounts those students are eligible to receive under this subpart shall not be deemed, by virtue of such agree- ment, a contractor maintaining a system of records to accomplish a function of the Secretary.
Recipients of Pell Grants shall not be considered to be individual grantees for purposes of subtitle D of title V of Public Law 100–690.

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401 (j) INSTITUTIONAL INELIGIBILITY BASED ON DEFAULT RATES.— (1) IN GENERAL.—No institution of higher education shall be an eligible institution for purposes of this subpart if such institution of higher education is ineligible to participate in a loan program under part B or D as a result of a final default rate determination made by the Secretary under part B or D after the final publication of cohort default rates for fiscal year 1996 or a succeeding fiscal year.
(2) SANCTIONS SUBJECT TO APPEAL OPPORTUNITY.—No in- stitution may be subject to the terms of this subsection unless the institution has had the opportunity to appeal the institu- tion’s default rate determination under regulations issued by the Secretary for the loan program authorized under part B or D, as applicable.
This subsection shall not apply to an institu- tion that was not participating in the loan program authorized under part B or D on the date of enactment of the Higher Edu- cation Amendments of 1998, unless the institution subse- quently participates in the loan programs.

øNote: Effective on July 1, 2024, section 703 of division FF of Public Law 116-260 provides for an amendment to strike section insert a new section 401.
Subsequently, sections 401 and 102(b)(1)(A)–(D) and 103(c)(1) of division R of Public Law 117–103 provide for amendments to section 104 (as amended and in effect by title VII of division FF of Public Law 116–260).

Upon such date, section 401 (as amended) will read as follows:¿ SEC.

401.

FEDERAL PELL GRANTS: AMOUNT AND DETERMINATIONS; APPLICATIONS.

(a) PURPOSE; DEFINITIONS.— (1) PURPOSE.—The purpose of this subpart is to provide a Federal Pell Grant to low-income students.
(2) DEFINITIONS.—In this section— (A) the term ‘‘adjusted gross income’’ means— (i) in the case of a dependent student, the adjusted gross income (as defined in section 62 of the Internal Revenue Code of 1986) of the student’s parents in the second tax year preceding the academic year; and (ii) in the case of an independent student, the ad- justed gross income (as defined in section 62 of the In- ternal Revenue Code of 1986) of the student (and the student’s spouse, if applicable) in the second tax year preceding the academic year; (B) the term ‘‘family size’’ has the meaning given the term in section 480(k); (C) the term ‘‘poverty line’’ means the poverty line (as determined under the poverty guidelines updated periodi- cally in the Federal Register by the Department of Health and Human Services under the authority of section 673(2) of the Community Services Block Grant Act (42 U.S.C.
9902(2))) applicable to the student’s family size and appli- cable to the second tax year preceding the academic year; (D) the term ‘‘single parent’’ means— September 8, 2023 As Amended Through P.L.

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401 HIGHER EDUCATION ACT OF 1965 192 (i) a parent of a dependent student who was a head of household (as defined in section 2(b) of the In- ternal Revenue Code of 1986) or a surviving spouse (as defined in section 2(a) of the Internal Revenue Code of 1986) or was an eligible individual for purposes of the credit under section 32 of such Code, in the second tax year preceding the academic year; or (ii) an independent student who is a parent and was a head of household (as defined in section 2(b) of the Internal Revenue Code of 1986) or a surviving spouse (as defined in section 2(a) of the Internal Rev- enue Code of 1986) or was an eligible individual for purposes of the credit under section 32 of such Code, in the second tax year preceding the academic year; (E) the term ‘‘total maximum Federal Pell Grant’’ means the total maximum Federal Pell Grant award per student for any academic year described under subsection (b)(5); and (F) the term ‘‘minimum Federal Pell Grant’’ means the minimum amount of a Federal Pell Grant that shall be awarded to a student for any academic year in which that student is attending full time, which shall be equal to 10 percent of the total maximum Federal Pell Grant for such academic year.
(b) AMOUNT AND DISTRIBUTION OF GRANTS.— (1) DETERMINATION OF AMOUNT OF A FEDERAL PELL GRANT.—Subject to paragraphs (2) and (3), the amount of a Federal Pell Grant for a student shall be determined in accord- ance with the following: (A) A student shall be eligible for a total maximum Federal Pell Grant for an academic year in which the stu- dent is enrolled in an eligible program full time— (i) if the student (and the student’s spouse, if appli- cable), or, in the case of a dependent student, the de- pendent student’s parents (or single parent), is not re- quired to file a Federal income tax return in the second year preceding the academic year; (ii) if the student or, in the case of a dependent stu- dent, the dependent student’s parent, is a single parent, and the adjusted gross income is greater than zero and equal to or less than 225 percent of the poverty line; or (iii) if the student or, in the case of a dependent student, the dependent student’s parent, is not a single parent, and the adjusted gross income is greater than zero and equal to or less than 175 percent of the pov- erty line.
(B) A student who is not eligible for a total maximum Federal Pell Grant under subparagraph (A) for an aca- demic year, shall be eligible for a Federal Pell Grant for an academic year in which the student is enrolled in an eligi- ble program full time if such student’s student aid index in such award year is less than the total maximum Federal Pell Grant for that award year.

The amount of the Federal September 8, 2023 As Amended Through P.L.
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401 Pell Grant for a student eligible under this subparagraph shall be— (i) the total maximum Federal Pell Grant as cal- culated under paragraph (5)(A) for that year, less (ii) an amount equal to the amount determined to be the student aid index with respect to that student for that year, except that a student aid index of less than zero shall be considered to be zero for the pur- poses of this clause, rounded to the nearest $5, except that a student eligible for less than the minimum Federal Pell Grant as defined in section (a)(2)(F) shall not be eligible for an award.
(C) A student who is not eligible for a Federal Pell Grant under subparagraph (A) or (B) shall be eligible for the minimum Federal Pell Grant for an academic year in which the student is enrolled in an eligible program full time— (i) in the case of a dependent student— (I) if the student’s parent is a single parent, and the adjusted gross income is equal to or less than 325 percent of the poverty line; or (II) if the student’s parent is not a single par- ent, and the adjusted gross income is equal to or less than 275 percent of the poverty line; or (ii) in the case of an independent student— (I) if the student is a single parent, and the adjusted gross income is equal to or less than 400 percent of the poverty line; (II) if the student is a parent and is not a sin- gle parent, and the adjusted gross income is equal to or less than 350 percent of the poverty line; or (III) if the student is not a parent, and the ad- justed gross income is equal to or less than 275 percent of the poverty line.
(D) A student eligible for the total maximum Federal Pell Grant under subparagraph (A) who has (or whose spouse or parent, as applicable based on whose information is used under such subparagraph, has) foreign income that would, if added to adjusted gross income, result in the stu- dent no longer being eligible for such total maximum Fed- eral Pell Grant, shall not be provided a Federal Pell Grant until the student aid administrator evaluates the student’s FAFSA and makes a determination regarding whether it is to make an adjustment under section appropriate 479A(b)(1)(B)(v) to account for such foreign income when determining the student’s eligibility for such total max- imum Federal Pell Grant.
(E) With respect to a student who is not eligible for the total maximum Federal Pell Grant under subparagraph (A) or a minimum Federal Pell Grant under subparagraph (C), the Secretary shall subtract from the student or parents’ adjusted gross income, as applicable based on whose in- come is used for the Federal Pell Grant calculation, the sum of the following for the individual whose income is so September 8, 2023 As Amended Through P.L.
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401 HIGHER EDUCATION ACT OF 1965 194 used, and consider such difference the adjusted gross in- come for purposes of determining the student’s eligibility for such Federal Pell Grant award under such subpara- graph: (i) If the applicant, or, if applicable, the parents or spouse of the applicant, elects to report receiving college grant and scholarship aid included in gross income on a Federal tax return described in section 480(e)(2), the amount of such aid.
(ii) Income earned from work under part C of this title.
(2) LESS THAN FULL-TIME ENROLLMENT.—In any case where a student is enrolled in an eligible program of an institution of higher education on less than a full-time basis (including a stu- dent who attends an institution of higher education on less than a half-time basis) during any academic year, the amount of the Federal Pell Grant to which that student is entitled shall be reduced in direct proportion to the degree to which that stu- dent is not so enrolled on a full-time basis, rounded to the near- est whole percentage point, as provided in a schedule of reduc- tions published by the Secretary computed in accordance with this subpart.
Such schedule of reductions shall be published in the Federal Register in accordance with section 482.

Such re- duced Federal Pell Grant for a student enrolled on a less than full-time basis shall also apply proportionally to students who are otherwise eligible to receive the minimum Federal Pell Grant, if enrolled full-time.
(3) AWARD MAY NOT EXCEED COST OF ATTENDANCE.—No Federal Pell Grant under this subpart shall exceed the cost of attendance (as defined in section 472) at the institution at which that student is in attendance.

If, with respect to any stu- dent, it is determined that the amount of a Federal Pell Grant for that student exceeds the cost of attendance for that year, the amount of the Federal Pell Grant shall be reduced until the Federal Pell Grant does not exceed the cost of attendance at such institution.
(4) STUDY ABROAD.—Notwithstanding any other provision of this subpart, the Secretary shall allow the amount of the Fed- eral Pell Grant to be exceeded for students participating in a program of study abroad approved for credit by the institution at which the student is enrolled when the reasonable costs of such program are greater than the cost of attendance at the stu- dent’s home institution, except that the amount of such Federal Pell Grant in any fiscal year shall not exceed the maximum amount of a Federal Pell Grant for which a student is eligible under paragraph (1) or (2) during such award year.
If the pre- ceding sentence applies, the financial aid administrator at the home institution may use the cost of the study abroad program, rather than the home institution’s cost, to determine the cost of attendance of the student.

(5) TOTAL MAXIMUM FEDERAL PELL GRANT.— (A) IN GENERAL.—For award year 2024–2025, and each subsequent award year, the total maximum Federal Pell Grant award per student shall be equal to the sum of— September 8, 2023 As Amended Through P.L.
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401 (i) $1,060; and (ii) the amount specified as the maximum Federal Pell Grant in the last enacted appropriation Act appli- cable to that award year.

(B) ROUNDING.—The total maximum Federal Pell Grant for any award year shall be rounded to the nearest $5.
(6) FUNDS BY FISCAL YEAR.— (A) IN GENERAL.—To carry out this section— (i) there are authorized to be appropriated and are appropriated (in addition to any other amounts appro- priated to carry out this section and out of any money in the Treasury not otherwise appropriated) such sums as are necessary to carry out paragraph (5)(A)(i) for fis- cal year 2024 and each subsequent fiscal year; and (ii) such sums as may be necessary are authorized to be appropriated to carry out paragraph (5)(A)(ii) for each of the fiscal years 2024 through 2034.
(B) AVAILABILITY OF FUNDS.—The amounts made available by subparagraph (A) for any fiscal year shall be available beginning on October 1 of that fiscal year, and shall remain available through September 30 of the suc- ceeding fiscal year.
(7) APPROPRIATION.— (A) IN GENERAL.—In addition to any funds appro- priated under paragraph (6) and any funds made available for this section under any appropriations Act, there are au- thorized to be appropriated, and there are appropriated (out of any money in the Treasury not otherwise appro- priated) to carry out this section, $1,170,000,000 for fiscal year 2023 and each subsequent award year.
(B) NO EFFECT ON PREVIOUS APPROPRIATIONS.—The amendments made to this section by the FAFSA Simplifica- tion Act shall not— (i) increase or decrease the amounts that have been appropriated or are available to carry out this section for fiscal year 2017, 2018, 2019, 2020, 2021, 2022, or 2023 as of the day before the effective date of such Act; or (ii) extend the period of availability for obligation that applied to any such amount, as of the day before such effective date.
(C) AVAILABILITY OF FUNDS.—The amounts made available by this paragraph for any fiscal year shall be available beginning on October 1 of that fiscal year, and shall remain available through September 30 of the suc- ceeding fiscal year.
(8) METHOD OF DISTRIBUTION.— (A) IN GENERAL.—For each fiscal year through fiscal year 2034, the Secretary shall pay to each eligible institu- tion such sums as may be necessary to pay each eligible student for each academic year during which that student is in attendance at an institution of higher education as an September 8, 2023 As Amended Through P.L.
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401 HIGHER EDUCATION ACT OF 1965 196 undergraduate, a Federal Pell Grant in the amount for which that student is eligible.
(B) ALTERNATIVE DISBURSEMENT.—Nothing in this sec- tion shall be interpreted to prohibit the Secretary from pay- ing directly to students, in advance of the beginning of the academic term, an amount for which they are eligible, in the cases where an eligible institution does not participate in the disbursement system under subparagraph (A).
(9) ADDITIONAL PAYMENT PERIODS IN SAME AWARD YEAR.— (A) Effective in the 2017–2018 award year and there- after, the Secretary shall award an eligible student not more than one and one-half Federal Pell Grants during a single award year to permit such student to work toward completion of an eligible program if, during that single award year, the student has received a Federal Pell Grant for an award year and is enrolled in an eligible program for one or more additional payment periods during the same award year that are not otherwise fully covered by the student’s Federal Pell Grant.
(B) In the case of a student receiving more than one Federal Pell Grant in a single award year under subpara- graph (A), the total amount of Federal Pell Grants awarded to such student for the award year may exceed the total maximum Federal Pell Grant available for an award year.

(C) Any period of study covered by a Federal Pell Grant awarded under subparagraph (A) shall be included in determining a student’s duration limit under subsection (d)(5).
(D) In any case where an eligible student is receiving a Federal Pell Grant for a payment period that spans 2 award years, the Secretary shall allow the eligible institu- tion in which the student is enrolled to determine the award year to which the additional period shall be as- signed, as it determines is most beneficial to students.

(c) SPECIAL RULE.— (1) IN GENERAL.—A student described in paragraph (2) shall be eligible for the total maximum Federal Pell Grant.
(2) APPLICABILITY.—Paragraph (1) shall apply to any de- pendent or independent student— (A) whose parent or guardian was— (i) an individual who, on or after September 11, 2001, died in the line of duty while serving on active duty as a member of the Armed Forces; or (ii) actively serving as a public safety officer and died in the line of duty while performing as a public safety officer; and (B) who is less than 33 years of age.
(3) INFORMATION.—Notwithstanding any other provision of law— (A) the Secretary shall establish the necessary data- sharing agreements with the Secretary of Veterans Affairs and the Secretary of Defense, as applicable, to provide the information necessary to determine which students meet the requirements of paragraph (2)(A)(i); and September 8, 2023 As Amended Through P.L.
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401 (B) the financial aid administrator shall verify with the student that the student is eligible for the adjustment and notify the Secretary of the adjustment of the student’s eligibility.
(4) TREATMENT OF PELL AMOUNT.—Notwithstanding section 1212 of the Omnibus Crime Control and Safe Streets Act of 1968 (34 U.S.C.

10302), in the case of a student who receives an increased Federal Pell Grant amount under this section, the total amount of such Federal Pell Grant, including the increase under this subsection, shall not be considered in calculating that student’s educational assistance benefits under the Public Safety Officers’ Benefits program under subpart 2 of part L of title I of such Act.
(5) PREVENTION OF DOUBLE BENEFITS.—No eligible student described in paragraph (2) may concurrently receive a grant under both this subsection and subsection (b).
(6) TERMS AND CONDITIONS.—The Secretary shall award grants under this subsection in the same manner and with the same terms and conditions, including the length of the period of eligibility, as the Secretary awards Federal Pell Grants under subsection (b), except that— (A) the award rules and determination of need applica- ble to the calculation of Federal Pell Grants under sub- section (b)(1) shall not apply to grants made under this subsection; and (B) the maximum period determined under subsection (d)(5) shall be determined by including all grants made under this section received by the eligible student and all grants so received under subpart 10 before the effective date of this subsection.
(7) DEFINITION OF PUBLIC SAFETY OFFICER.—For purposes of this subsection, the term ‘‘public safety officer’’ means— (A) a public safety officer, as defined in section 1204 of title I of the Omnibus Crime Control and Safe Streets Act of 1968 (34 U.S.C.
10284); or (B) a fire police officer, defined as an individual who— (i) is serving in accordance with State or local law as an officially recognized or designated member of a legally organized public safety agency; (ii) is not a law enforcement officer, a firefighter, a chaplain, or a member of a rescue squad or ambu- lance crew; and (iii) provides scene security or directs traffic— (I) in response to any fire drill, fire call, or other fire, rescue, or police emergency; or (II) at a planned special event.
(d) 9 PERIOD OF ELIGIBILITY FOR GRANTS.— (1) IN GENERAL.—The period during which a student may receive Federal Pell Grants shall be the period required for the completion of the first undergraduate baccalaureate course of study being pursued by that student at the institution at which 9 See section 102(c) of Public 117-103 for select amendments made by Public Law 116-260 (as amended by P.L.
117-103) where the Secretary of Education may implement for certain purposes on or after July 1, 2023, but not lather than July 1, 2024.

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401 HIGHER EDUCATION ACT OF 1965 198 the student is in attendance, except that any period during which the student is enrolled in a noncredit or remedial course of study, as described in paragraph (2), shall not be counted for the purpose of this paragraph.
(2) NONCREDIT OR REMEDIAL COURSES; STUDY ABROAD.— Nothing in this section shall exclude from eligibility courses of study which are noncredit or remedial in nature (including courses in English language instruction) which are determined by the institution to be necessary to help the student be pre- pared for the pursuit of a first undergraduate baccalaureate de- gree or certificate or, in the case of courses in English language instruction, to be necessary to enable the student to use already existing knowledge, training, or skills.
Nothing in this section shall exclude from eligibility programs of study abroad that are approved for credit by the home institution at which the student is enrolled.

(3) NO CONCURRENT PAYMENTS.—No student is entitled to receive Pell Grant payments concurrently from more than one institution or from both the Secretary and an institution.
(4) POSTBACCALAUREATE PROGRAM.—Notwithstanding paragraph (1), the Secretary may allow, on a case-by-case basis, a student to receive a Federal Pell Grant if the student— (A) is carrying at least one-half the normal full-time work load for the course of study the student is pursuing, as determined by the institution of higher education; and (B) is enrolled or accepted for enrollment in a postbaccalaureate program that does not lead to a graduate degree, and in courses required by a State in order for the student to receive a professional certification or licensing credential that is required for employment as a teacher in an elementary school or secondary school in that State, except that this paragraph shall not apply to a student who is enrolled in an institution of higher education that offers a bac- calaureate degree in education.
(5) MAXIMUM PERIOD.— (A) IN GENERAL.—Except as provided in subparagraph (B), the period during which a student may receive Federal Pell Grants shall not exceed 12 semesters, or the equivalent of 12 semesters, as determined by the Secretary by regula- tion.

Such regulations shall provide, with respect to a stu- dent who received a Federal Pell Grant for a term but was enrolled at a fraction of full time, that only that same frac- tion of such semester or equivalent shall count towards such duration limits.
(B) EXCEPTION.— (i) IN GENERAL.—Any Federal Pell Grant that a student received during a period described in subclause (I) or (II) of clause (ii) shall not count towards the stu- dent’s duration limits under this paragraph.

(ii) APPLICABLE PERIODS.—Clause (i) shall apply with respect to any Federal Pell Grant awarded to a student to enroll in an eligible program at an institu- tion— September 8, 2023 As Amended Through P.L.
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401 (I) during a period of a student’s attendance at an institution— (aa) at which the student was unable to complete a course of study due to the closing of the institution; or (bb) for which the student was falsely cer- tified as eligible for Federal aid under this title; or (II) during a period— (aa) for which the student received a loan under this title; and (bb) for which the loan described in item (aa) is discharged under— (AA) section 437(c)(1) or section 464(g)(1); (BB) section 432(a)(6); or (CC) section 455(h) due to the stu- dent’s successful assertion of a defense to repayment of the loan, including defenses provided to any applicable groups of stu- dents.
(e) APPLICATIONS FOR GRANTS.— (1) DEADLINES.—The Secretary shall from time to time set dates by which students shall file the Free Application for Fed- eral Student Aid under section 483.

(2) APPLICATION.—Each student desiring a Federal Pell Grant for any year shall file the Free Application for Federal Student Aid containing the information necessary to enable the Secretary to carry out the functions and responsibilities of this subpart.
(f) DISTRIBUTION OF GRANTS TO STUDENTS.—Payments under this section shall be made in accordance with regulations promul- gated by the Secretary for such purpose, in such manner as will best accomplish the purpose of this section.

Any disbursement allowed to be made by crediting the student’s account shall be limited to tui- tion and fees, and food and housing if that food and housing is in- stitutionally owned or operated.
The student may elect to have the institution provide other such goods and services by crediting the student’s account.
(g) INSUFFICIENT APPROPRIATIONS.—If, for any fiscal year, the funds appropriated for payments under this subpart are insufficient to satisfy fully all entitlements, as calculated under subsections (b) and (c) (but at the maximum grant level specified in such appro- priation), the Secretary shall promptly transmit a notice of such in- sufficiency to each House of the Congress, and identify in such no- tice the additional amount that would be required to be appro- priated to satisfy fully all entitlements (as so calculated at such maximum grant level).
(h) USE OF EXCESS FUNDS.— (1) 15 PERCENT OR LESS.—If, at the end of a fiscal year, the funds available for making payments under this subpart exceed the amount necessary to make the payments required under this subpart to eligible students by 15 percent or less, then all of the September 8, 2023 As Amended Through P.L.
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401A HIGHER EDUCATION ACT OF 1965 200 excess funds shall remain available for making payments under this subpart during the next succeeding fiscal year.
(2) MORE THAN 15 PERCENT.—If, at the end of a fiscal year, the funds available for making payments under this subpart ex- ceed the amount necessary to make the payments required under this subpart to eligible students by more than 15 percent, then all of such funds shall remain available for making such payments but payments may be made under this paragraph only with respect to entitlements for that fiscal year.
(i) TREATMENT OF INSTITUTIONS AND STUDENTS UNDER OTHER LAWS.—Any institution of higher education which enters into an agreement with the Secretary to disburse to students attending that institution the amounts those students are eligible to receive under this subpart shall not be deemed, by virtue of such agreement, a contractor maintaining a system of records to accomplish a function of the Secretary.
Recipients of Pell Grants shall not be considered to be individual grantees for purposes of chapter 81 of title 41, United States Code.
(j) INSTITUTIONAL INELIGIBILITY BASED ON DEFAULT RATES.— (1) IN GENERAL.—No institution of higher education shall be an eligible institution for purposes of this subpart if such in- stitution of higher education is ineligible to participate in a loan program under part B or D as a result of a final default rate determination made by the Secretary under part B or D after the final publication of cohort default rates for fiscal year 1996 or a succeeding fiscal year.
(2) SANCTIONS SUBJECT TO APPEAL OPPORTUNITY.—No in- stitution may be subject to the terms of this subsection unless the institution has had the opportunity to appeal the institu- tion’s default rate determination under regulations issued by the Secretary for the loan program authorized under part B or D, as applicable.
This subsection shall not apply to an institu- tion that was not participating in the loan program authorized under part B or D on October 7, 1998, unless the institution subsequently participates in the loan programs.

SEC.

401A.

ø20 U.S.C.

1070a–1¿ ACADEMIC COMPETITIVENESS GRANTS.


(a) ACADEMIC COMPETITIVENESS GRANT PROGRAM AUTHOR- IZED.—The Secretary shall award grants, in the amounts specified in subsection (d)(1), to eligible students to assist the eligible stu- dents in paying their college education expenses.
(b) DESIGNATION.—A grant under this section— (1) for the first or second year of a program of under- graduate education shall be known as an ‘‘Academic Competi- tiveness Grant’’; and (2) for the third, fourth, or fifth year of a program of un- dergraduate education shall be known as a ‘‘National Science and Mathematics Access to Retain Talent Grant’’ or a ‘‘Na- tional SMART Grant’’.
(c) DEFINITION OF ELIGIBLE STUDENT.—In this section the term ‘‘eligible student’’ means a student who, for the award year for which the determination of eligibility is made for a grant under this section— (1) is eligible for a Federal Pell Grant; September 8, 2023 As Amended Through P.L.
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401A (2) is enrolled or accepted for enrollment in an institution of higher education on not less than a half-time basis; and (3) in the case of a student enrolled or accepted for enroll- ment in— (A) the first year of a program of undergraduate education at a two- or four-year degree-granting institu- tion of higher education (including a program of not less than one year institution awards a certificate)— for which the (i)(I) successfully completes, after January 1, 2006, but before July 1, 2009, a rigorous secondary school program of study established by a State or local educational agency and recognized as such by the Sec- retary; or (II) successfully completes, on or after July 1, 2009, a rigorous secondary school program of study that prepares students for college— (aa)(AA) that is recognized as such by the offi- cial designated for such recognition consistent with State law; and (BB) about which the designated official has reported to the Secretary, at such time as the Sec- retary may reasonably require, in order to assist financial aid administrators to determine that the student is an eligible student under this section; or (bb) that is recognized as such by the Sec- retary in regulations promulgated to carry out this section, as such regulations were in effect on May 6, 2008; and (ii) has not been previously enrolled in a program of undergraduate education, except as part of a sec- ondary school program of study; (B) the second year of a program of undergraduate education at a two- or four-year degree-granting institu- tion of higher education (including a program of not less than two years for which the institution awards a certifi- cate)— (i)(I) successfully completes, after January 1, 2005, but before July 1, 2009, a rigorous secondary school program of study established by a State or local educational agency and recognized as such by the Sec- retary; or (II) successfully completes, on or after July 1, 2009, a rigorous secondary school program of study that prepares students for college— (aa)(AA) that is recognized as such by the offi- cial designated for such recognition consistent with State law; and (BB) about which the designated official has reported to the Secretary, at such time as the Sec- retary may reasonably require, in order to assist financial aid administrators to determine that the September 8, 2023 As Amended Through P.L.
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401A HIGHER EDUCATION ACT OF 1965 202 student is an eligible student under this section; or (bb) that is recognized as such by the Sec- retary in regulations promulgated to carry out this section, as such regulations were in effect on May 6, 2008; and (ii) has obtained a cumulative grade point average of at least 3.0 (or the equivalent as determined under regulations prescribed by the Secretary) at the end of the first year of such program of undergraduate edu- cation; (C) the third or fourth year of a program of under- graduate education at a four-year degree-granting institu- tion of higher education— (i) is certified by the institution to be pursuing a major in— (I) the physical, life, or computer sciences, mathematics, technology, or engineering (as deter- mined by the Secretary pursuant to regulations); or (II) a critical foreign language; and (ii) has obtained a cumulative grade point average of at least 3.0 (or the equivalent as determined under regulations prescribed by the Secretary) in the coursework required for the major described in clause (i); (D) the third or fourth year of a program of under- graduate education at an institution of higher education (as defined in section 101(a)), is attending an institution that demonstrates, to the satisfaction of the Secretary, that the institution— (i) offers a single liberal arts curriculum leading to a baccalaureate degree, under which students are not permitted by the institution to declare a major in a particular subject area, and the student— (I)(aa) studies, in such years, a subject de- scribed in subparagraph (C)(i) that is at least equal to the requirements for an academic major at an institution of higher education that offers a baccalaureate degree in such subject, as certified by an appropriate official from the institution; and (bb) has obtained a cumulative grade point average of at least 3.0 (or the equivalent as deter- mined under regulations prescribed by the Sec- retary) in the relevant coursework; or (II) is required, as part of the student’s degree program, to undertake a rigorous course of study in mathematics, biology, chemistry, and physics, which consists of at least— (aa) 4 years of study in mathematics; and (bb) 3 years of study in the sciences, with a laboratory component in each of those years; and September 8, 2023 As Amended Through P.L.
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401A (ii) offered such curriculum prior to February 8, 2006; or (E) the fifth year of a program of undergraduate edu- cation that requires 5 full years of coursework, as certified by the appropriate official of the degree-granting institu- tion of higher education, for which a baccalaureate degree is awarded by a degree-granting institution of higher edu- cation— (i) is certified by the institution of higher edu- cation to be pursuing a major in— (I) the physical, life, or computer sciences, mathematics, technology, or engineering (as deter- mined by the Secretary pursuant to regulations); or (II) a critical foreign language; and (ii) has obtained a cumulative grade point average of at least 3.0 (or the equivalent, as determined under regulations prescribed by the Secretary) in the coursework required for the major described in clause (i).
(d) GRANT AWARD.— (1) AMOUNTS.— (A) IN GENERAL.—The Secretary shall award a grant under this section in the amount of— (i) $750 for an eligible student under subsection (c)(3)(A); (ii) $1,300 for an eligible student under subsection (c)(3)(B); (iii) $4,000 for an eligible student under subpara- graph (C) or (D) of subsection (c)(3), for each of the two years described in such subparagraphs; or (iv) $4,000 for an eligible student under sub- section (c)(3)(E).
(B) LIMITATION; RATABLE REDUCTION.—Notwith- standing subparagraph (A)— (i) in any case in which a student attends an insti- tution of higher education on less than a full-time basis, the amount of the grant that such student may receive shall be reduced in the same manner as a Fed- eral Pell Grant is reduced under section 401(b)(2)(B); (ii) the amount of such grant, in combination with the Federal Pell Grant assistance and other student fi- nancial assistance available to such student, shall not exceed the student’s cost of attendance; (iii) if the amount made available under sub- section (e) for any fiscal year is less than the amount required to be provided grants to all eligible students in the amounts determined under subparagraph (A) and clause (i) of this subparagraph, then the amount of the grant to each eligible student shall be ratably reduced; and (iv) if additional amounts are appropriated for any such fiscal year, such reduced amounts shall be increased on the same basis as they were reduced.
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402A HIGHER EDUCATION ACT OF 1965 204 (2) LIMITATIONS.— (A) NO GRANTS FOR PREVIOUS CREDIT.—The Secretary may not award a grant under this section to any student for any year of a program of undergraduate education for which the student received credit before the date of enact- ment of the Higher Education Reconciliation Act of 2005.

(B) NUMBER OF GRANTS.—The Secretary may not award more than one grant to a student described in sub- section (c)(3) for each year of study described in such sub- section.
(3) CALCULATION OF GRANT PAYMENTS.—An institution of higher education shall make payments of a grant awarded under this section in the same manner, using the same pay- ment periods, as such institution makes payments for Federal Pell Grants under section 401.
(e) FUNDING.— (1) AUTHORIZATION AND APPROPRIATION OF FUNDS.—There are authorized to be appropriated, and there are appropriated, out of any money in the Treasury not otherwise appropriated, for the Department of Education to carry out this section— (A) $790,000,000 for fiscal year 2006; (B) $850,000,000 for fiscal year 2007; (C) $920,000,000 for fiscal year 2008; (D) $960,000,000 for fiscal year 2009; and (E) $1,010,000,000 for fiscal year 2010.
(2) AVAILABILITY OF FUNDS.—The amounts made available by paragraph (1) for any fiscal year shall be available from Oc- tober 1 of that fiscal year and remain available through Sep- tember 30 of the succeeding fiscal year.

(f) RECOGNITION OF PROGRAMS OF STUDY.—The Secretary shall recognize not less than one rigorous secondary school program of study in each State under subparagraphs (A) and (B) of subsection (c)(3) for the purpose of determining student eligibility under such subsection.
(g) SUNSET PROVISION.—The authority to make grants under this section shall expire at the end of award year 2010–2011.

Subpart 2—Federal Early Outreach and Student Services Programs CHAPTER 1—FEDERAL TRIO PROGRAMS SEC.

402A.

ø20 U.S.C.

1070a–11¿ PROGRAM AUTHORITY; AUTHORIZA- TION OF APPROPRIATIONS.
(a) GRANTS AND CONTRACTS AUTHORIZED.—The Secretary shall, in accordance with the provisions of this chapter, carry out a program of making grants and contracts designed to identify qualified individuals from disadvantaged backgrounds, to prepare them for a program of postsecondary education, to provide support services for such students who are pursuing programs of postsec- ondary education, to motivate and prepare students for doctoral programs, and to train individuals serving or preparing for service in programs and projects so designed.
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402A (b) RECIPIENTS, DURATION, AND SIZE.— (1) RECIPIENTS.—For the purposes described in subsection (a), the Secretary is authorized, without regard to section 3709 of the Revised Statutes (41 U.S.C.
5), to make grants to, and contracts with, institutions of higher education, public and pri- vate agencies and organizations, including community-based organizations with experience in serving disadvantaged youth, combinations of such institutions, agencies and organizations, and, as appropriate to the purposes of the program, secondary schools, for planning, developing, or carrying out one or more of the services assisted under this chapter.
(2) DURATION.—Grants or contracts made under this chap- ter shall be awarded for a period of 5 years, except that— (A) in order to synchronize the awarding of grants for programs under this chapter, the Secretary may, under such terms as are consistent with the purposes of this chapter, provide a one-time, limited extension of the length of such an award; (B) grants made under section 402G shall be awarded for a period of 2 years; and (C) grants under section 402H shall be awarded for a period determined by the Secretary.
(3) MINIMUM GRANTS.—Unless the institution or agency re- quests a smaller amount, an individual grant authorized under this chapter shall be awarded in an amount that is not less than $200,000, except that an individual grant authorized under section 402G shall be awarded in an amount that is not less than $170,000.
(c) PROCEDURES FOR AWARDING GRANTS AND CONTRACTS.— (1) APPLICATION REQUIREMENTS.—An eligible entity that desires to receive a grant or contract under this chapter shall submit an application to the Secretary in such manner and form, and containing such information and assurances, as the Secretary may reasonably require.
(2) CONSIDERATIONS.— (A) PRIOR EXPERIENCE.—In making grants under this chapter, the Secretary shall consider each applicant’s prior experience of high quality service delivery, as determined under subsection (f), under the particular program for which funds are sought.
The level of consideration given the factor of prior experience shall not vary from the level of consideration given such factor during fiscal years 1994 through 1997, except that grants made under section 402H shall not be given prior experience consideration.
(B) PARTICIPANT NEED.—In making grants under this chapter, the Secretary shall consider the number, percent- ages, and needs of eligible participants in the area, institu- tion of higher education, or secondary school to be served to aid such participants in preparing for, enrolling in, or succeeding in postsecondary education, as appropriate to the particular program for which the eligible entity is ap- plying.
(3) ORDER OF AWARDS; PROGRAM FRAUD.—(A) Except with respect to grants made under sections 402G and 402H and as September 8, 2023 As Amended Through P.L.

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402A HIGHER EDUCATION ACT OF 1965 206 provided in subparagraph (B), the Secretary shall award grants and contracts under this chapter in the order of the scores received by the application for such grant or contract in the peer review process required under paragraph (4) and ad- justed for prior experience in accordance with paragraph (2) of this subsection.
(B) The Secretary shall not provide assistance to a pro- gram otherwise eligible for assistance under this chapter, if the Secretary has determined that such program has involved the fraudulent use of funds under this chapter.
(4) PEER REVIEW PROCESS.—(A) The Secretary shall ensure that, to the extent practicable, members of groups underrep- resented in higher education, including African Americans, Hispanics, Native Americans, Alaska Natives, Asian Ameri- cans, and Native American Pacific Islanders (including Native Hawaiians), are represented as readers of applications sub- mitted under this chapter.

The Secretary shall also ensure that persons from urban and rural backgrounds are represented as readers.
(B) The Secretary shall ensure that each application sub- mitted under this chapter is read by at least three readers who are not employees of the Federal Government (other than as readers of applications).

(5) NUMBER OF APPLICATIONS FOR GRANTS AND CON- TRACTS.—The Secretary shall not limit the number of applica- tions submitted by an entity under any program authorized under this chapter if the additional applications describe pro- grams serving different populations or different campuses.
(6) COORDINATION WITH OTHER PROGRAMS FOR DISADVAN- TAGED STUDENTS.—The Secretary shall encourage coordination of programs assisted under this chapter with other programs for disadvantaged students operated by the sponsoring institu- tion or agency, regardless of the funding source of such pro- grams.
The Secretary shall not limit an entity’s eligibility to receive funds under this chapter because such entity sponsors a program similar to the program to be assisted under this chapter, regardless of the funding source of such program.

The Secretary shall permit the Director of a program receiving funds under this chapter to administer one or more additional programs for disadvantaged students operated by the spon- soring institution or agency, regardless of the funding sources of such programs.
The Secretary shall, as appropriate, require each applicant for funds under the programs authorized by this chapter to identify and make available services under such program, including mentoring, tutoring, and other services pro- vided by such program, to foster care youth (including youth in foster care and youth who have left foster care after reach- ing age 13) or to homeless children and youths as defined in section 725 of the McKinney-Vento Homeless Assistance Act.
(7) APPLICATION STATUS.—The Secretary shall inform each entity operating programs under this chapter regarding the status of their application for continued funding at least 8 months prior to the expiration of the grant or contract.

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402A a successful program under this chapter, shall ensure that the start-up date for a new grant or contract for such program im- mediately follows the termination of the preceding grant or contract so that no interruption of funding occurs for such suc- cessful reapplicants.

The Secretary shall inform each entity re- questing assistance under this chapter for a new program re- garding the status of their application at least 8 months prior to the proposed startup date of such program.
(8) REVIEW AND NOTIFICATION BY THE SECRETARY.— (A) GUIDANCE.—Not later than 180 days after the date of enactment of the Higher Education Opportunity Act, the Secretary shall issue nonregulatory guidance regarding the rights and responsibilities of applicants with respect to the application and evaluation process for programs and projects assisted under this chapter, including applicant access to peer review comments.
The guidance shall de- scribe the procedures for the submission, processing, and scoring of applications for grants under this chapter, in- cluding— (i) the responsibility of applicants to submit mate- rials in a timely manner and in accordance with the processes established by the Secretary under the au- thority of the General Education Provisions Act; (ii) steps the Secretary will take to ensure that the materials submitted by applicants are processed in a proper and timely manner; (iii) steps the Secretary will take to ensure that prior experience points for high quality service deliv- ery are awarded in an accurate and transparent man- ner; (iv) steps the Secretary will take to ensure the quality and integrity of the peer review process, in- cluding assurances that peer reviewers will consider applications for grants under this chapter in a thor- ough and complete manner consistent with applicable Federal law; and (v) steps the Secretary will take to ensure that the final score of an application, including prior experience points for high quality service delivery and points awarded through the peer review process, is deter- mined in an accurate and transparent manner.
(B) UPDATED GUIDANCE.—Not later than 45 days be- fore the date of the commencement of each competition for a grant under this chapter that is held after the expiration of the 180-day period described in subparagraph (A), the Secretary shall update and publish the guidance described in such subparagraph.
(C) REVIEW.— (i) IN GENERAL.—With respect to any competition for a grant under this chapter, an applicant may re- quest a review by the Secretary if the applicant— (I) has evidence of a specific technical, admin- istrative, or scoring error made by the Depart- ment, an agent of the Department, or a peer re- September 8, 2023 As Amended Through P.L.
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402A HIGHER EDUCATION ACT OF 1965 208 viewer, with respect to the scoring or processing of a submitted application; and (II) has otherwise met all of the requirements for submission of the application.
(ii) TECHNICAL OR ADMINISTRATIVE ERROR.—In the case of evidence of a technical or administrative error listed in clause (i)(I), the Secretary shall review such evidence and provide a timely response to the appli- cant.

If the Secretary determines that a technical or administrative error was made by the Department or an agent of the Department, the application of the ap- plicant shall be reconsidered in the peer review proc- ess for the applicable grant competition.
(iii) SCORING ERROR.—In the case of evidence of a scoring error listed in clause (i)(I), when the error re- lates to either prior experience points for high quality service delivery or to the final score of an application, the Secretary shall— (I) review such evidence and provide a timely response to the applicant; and (II) if the Secretary determines that a scoring error was made by the Department or a peer re- viewer, adjust the prior experience points or final score of the application appropriately and quickly, so as not to interfere with the timely awarding of grants for the applicable grant competition.
(iv) ERROR IN PEER REVIEW PROCESS.— (I) REFERRAL TO SECONDARY REVIEW.—In the case of a peer review process error listed in clause (i)(I), if the Secretary determines that points were withheld for criteria not required in Federal stat- ute, regulation, or guidance governing a program assisted under this chapter or the application for a grant for such program, or determines that in- formation pertaining to selection criteria was wrongly determined to be missing from an appli- cation by a peer reviewer, then the Secretary shall refer the application to a secondary review panel.
(II) TIMELY REVIEW; REPLACEMENT SCORE.— The secondary review panel described in sub- clause (I) shall conduct a secondary review in a timely fashion, and the score resulting from the secondary review shall replace the score from the initial peer review.
(III) COMPOSITION OF SECONDARY REVIEW PANEL.—The secondary review panel shall be com- posed of reviewers each of whom— (aa) did not review the application in the original peer review; (bb) is a member of the cohort of peer re- viewers for the grant program that is the sub- ject of such secondary review; and (cc) to extent practicable, has conducted peer reviews in not less than two previous September 8, 2023 As Amended Through P.L.
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402A competitions for the grant program that is the subject of such secondary review.
(IV) FINAL SCORE.—The final peer review score of an application subject to a secondary re- view under this clause shall be adjusted appro- priately and quickly using the score awarded by the secondary review panel, so as not to interfere with the timely awarding of grants for the appli- cable grant competition.
(V) QUALIFICATION FOR SECONDARY REVIEW.— To qualify for a secondary review under this clause, an applicant shall have evidence of a scor- ing error and demonstrate that— (aa) points were withheld for criteria not required in statute, regulation, or guidance governing the Federal TRIO programs or the application for a grant for such programs; or (bb) information pertaining to selection criteria was wrongly determined to be missing from the application.
(v) FINALITY.— (I) IN GENERAL.—A determination by the Sec- retary under clause (i), (ii), or (iii) shall not be re- viewable by any officer or employee of the Depart- ment.

(II) SCORING.—The score awarded by a sec- ondary review panel under clause (iv) shall not be reviewable by any officer or employee of the De- partment other than the Secretary.
(vi) FUNDING OF APPLICATIONS WITH CERTAIN AD- JUSTED SCORES.—To the extent feasible based on the availability of appropriations, the Secretary shall fund applications with scores that are adjusted upward under clauses (ii), (iii), and (iv) to equal or exceed the minimum cut off score for the applicable grant com- petition.
(d) OUTREACH.— (1) IN GENERAL.—The Secretary shall conduct outreach ac- tivities to ensure that entities eligible for assistance under this chapter submit applications proposing programs that serve ge- ographic areas and eligible populations which have been un- derserved by the programs assisted under this chapter.
(2) NOTICE.—In carrying out the provisions of paragraph (1), the Secretary shall notify the entities described in sub- section (b) of the availability of assistance under this sub- section not less than 120 days prior to the deadline for submis- sion of applications under this chapter and shall consult na- tional, State, and regional organizations about candidates for notification.
(3) TECHNICAL ASSISTANCE.—The Secretary shall provide technical training to applicants for projects and programs au- thorized under this chapter.

The Secretary shall give priority to serving programs and projects that serve geographic areas and eligible populations which have been underserved by the September 8, 2023 As Amended Through P.L.
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402A HIGHER EDUCATION ACT OF 1965 210 programs assisted under this chapter.
Technical training ac- tivities shall include the provision of information on author- izing legislation, goals and objectives of the program, required activities, eligibility requirements, the application process and application deadlines, and assistance in the development of program proposals and the completion of program applications.
Such training shall be furnished at conferences, seminars, and workshops to be conducted at not less than 10 sites throughout the United States to ensure that all areas of the United States with large concentrations of eligible participants are served.

(4) SPECIAL RULE.—The Secretary may contract with eligi- ble entities to conduct the outreach activities described in this subsection.
(e) DOCUMENTATION OF STATUS AS A LOW-INCOME INDI- VIDUAL.—(1) Except in the case of an independent student, as de- fined in section 480(d), documentation of an individual’s status pur- suant to subsection (h)(4) shall be made by providing the Secretary with— (A) a signed statement from the individual’s parent or legal guardian; (B) verification from another governmental source; (C) a signed financial aid application; or (D) a signed United States or Puerto Rico income tax re- turn.
(2) In the case of an independent student, as defined in section 480(d), documentation of an individual’s status pursuant to sub- section (h)(4) shall be made by providing the Secretary with— (A) a signed statement from the individual; (B) verification from another governmental source; (C) a signed financial aid application; or (D) a signed United States or Puerto Rico income tax re- turn.
(3) Notwithstanding this subsection and subsection (h)(4), indi- viduals who are foster care youth (including youth in foster care and youth who have left foster care after reaching age 13), or homeless children and youths as defined in section 725 of the McKinney-Vento Homeless Assistance Act, shall be eligible to par- ticipate in programs under sections 402B, 402C, 402D, and 402F.
(f) OUTCOME CRITERIA.— (1) USE FOR PRIOR EXPERIENCE DETERMINATION.—For com- petitions for grants under this chapter that begin on or after January 1, 2009, the Secretary shall determine an eligible enti- ty’s prior experience of high quality service delivery, as re- quired under subsection (c)(2), based on the outcome criteria described in paragraphs (2) and (3).
(2) DISAGGREGATION OF RELEVANT DATA.—The outcome cri- teria under this subsection shall be disaggregated by low-in- come students, first generation college students, and individ- uals with disabilities, in the schools and institutions of higher education served by the program to be evaluated.
(3) CONTENTS OF OUTCOME CRITERIA.—The outcome cri- teria under this subsection shall measure, annually and for longer periods, the quality and effectiveness of programs au- thorized under this chapter and shall include the following: September 8, 2023 As Amended Through P.L.
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402A (A) For programs authorized under section 402B, the extent to which the eligible entity met or exceeded the en- tity’s objectives established in the entity’s application for such program regarding— (i) the delivery of service to a total number of stu- dents served by the program; (ii) the continued secondary school enrollment of such students; (iii) the graduation of such students from sec- ondary school with a regular secondary school diploma in the standard number of years; (iv) the completion by such students of a rigorous secondary school program of study that will make such students eligible for programs such as the Academic Competitiveness Grants Program; (v) the enrollment of such students in an institu- tion of higher education; and (vi) to the extent practicable, the postsecondary education completion of such students.
(B) For programs authorized under section 402C, the extent to which the eligible entity met or exceeded the en- tity’s objectives for such program regarding— (i) the delivery of service to a total number of stu- dents served by the program, as agreed upon by the entity and the Secretary for the period; (ii) such students’ school performance, as meas- ured by the grade point average, or its equivalent; (iii) such students’ academic performance, as measured by standardized tests, including tests re- quired by the students’ State; (iv) the retention in, and graduation from, sec- ondary school of such students; (v) the completion by such students of a rigorous secondary school program of study that will make such students eligible for programs such as the Academic Competitiveness Grants Program; (vi) the enrollment of such students in an institu- tion of higher education; and (vii) to the extent practicable, the postsecondary education completion of such students.
(C) For programs authorized under section 402D— (i) the extent to which the eligible entity met or exceeded the entity’s objectives regarding the retention in postsecondary education of the students served by the program; (ii)(I) in the case of an entity that is an institution of higher education offering a baccalaureate degree, the extent to which the entity met or exceeded the en- tity’s objectives regarding the percentage of such stu- dents’ completion of the degree programs in which such students were enrolled; or (II) in the case of an entity that is an institution of higher education that does not offer a baccalaureate September 8, 2023 As Amended Through P.L.
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402A HIGHER EDUCATION ACT OF 1965 212 degree, the extent to which such students met or ex- ceeded the entity’s objectives regarding— (aa) the completion of a degree or certificate by such students; and (bb) the transfer of such students to institu- tions of higher education that offer baccalaureate degrees; (iii) the extent to which the entity met or exceeded the entity’s objectives regarding the delivery of service to a total number of students, as agreed upon by the entity and the Secretary for the period; and (iv) the extent to which the entity met or exceeded the entity’s objectives regarding the students served under the program who remain in good academic standing.
(D) For programs authorized under section 402E, the extent to which the entity met or exceeded the entity’s ob- jectives for such program regarding— (i) the delivery of service to a total number of stu- dents served by the program, as agreed upon by the entity and the Secretary for the period; (ii) the provision of appropriate scholarly and re- search activities for the students served by the pro- gram; (iii) the acceptance and enrollment of such stu- dents in graduate programs; and (iv) the continued enrollment of such students in graduate study and the attainment of doctoral degrees by former program participants.
(E) For programs authorized under section 402F, the extent to which the entity met or exceeded the entity’s ob- jectives for such program regarding— (i) the enrollment of students without a secondary school diploma or its recognized equivalent, who were served by the program, in programs leading to such di- ploma or equivalent; (ii) the enrollment of secondary school graduates who were served by the program in programs of post- secondary education; (iii) the delivery of service to a total number of students served by the program, as agreed upon by the entity and the Secretary for the period; and (iv) the provision of assistance to students served by the program in completing financial aid applica- tions and college admission applications.
(4) MEASUREMENT OF PROGRESS.—In order to determine the extent to which each outcome criterion described in para- graph (2) or (3) is met or exceeded, the Secretary shall compare the agreed upon target for the criterion, as established in the eligible entity’s application approved by the Secretary, with the results for the criterion, measured as of the last day of the ap- plicable time period for the determination for the outcome cri- terion.

September 8, 2023 As Amended Through P.L.


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402A (g) AUTHORIZATION OF APPROPRIATIONS.—For the purpose of making grants and contracts under this chapter, there are author- ized to be appropriated $900,000,000 for fiscal year 2009 and such sums as may be necessary for each of the five succeeding fiscal years.
Of the amount appropriated under this chapter, the Sec- retary may use no more than 1⁄2 of 1 percent of such amount to ob- tain additional qualified readers and additional staff to review ap- plications, to increase the level of oversight monitoring, to support impact studies, program assessments and reviews, and to provide technical assistance to potential applicants and current grantees.
In expending these funds, the Secretary shall give priority to the additional administrative requirements provided in the Higher Education Amendments of 1992, to outreach activities, and to ob- taining additional readers.
(h) DEFINITIONS.—For the purpose of this chapter: (1) DIFFERENT CAMPUS.—The term ‘‘different campus’’ means a site of an institution of higher education that— (A) is geographically apart from the main campus of the institution; (B) is permanent in nature; and (C) offers courses in educational programs leading to a degree, certificate, or other recognized educational cre- dential.
(2) DIFFERENT POPULATION.—The term ‘‘different popu- lation’’ means a group of individuals that an eligible entity de- sires to serve through an application for a grant under this chapter, and that— (A) is separate and distinct from any other population that the entity has applied for a grant under this chapter to serve; or (B) while sharing some of the same needs as another population that the eligible entity has applied for a grant under this chapter to serve, has distinct needs for special- ized services.
(3) FIRST GENERATION COLLEGE STUDENT.—The term ‘‘first generation college student’’ means— (A) an individual both of whose parents did not com- plete a baccalaureate degree; or (B) in the case of any individual who regularly resided with and received support from only one parent, an indi- vidual whose only such parent did not complete a bacca- laureate degree.
(4) LOW-INCOME INDIVIDUAL.—The term ‘‘low-income indi- vidual’’ means an individual from a family whose taxable in- come for the preceding year did not exceed 150 percent of an amount equal to the poverty level determined by using criteria of poverty established by the Bureau of the Census.
(5) VETERAN ELIGIBILITY.—No veteran shall be deemed in- eligible to participate in any program under this chapter by reason of such individual’s age who— (A) served on active duty for a period of more than 180 days and was discharged or released therefrom under con- ditions other than dishonorable; September 8, 2023 As Amended Through P.L.
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402B HIGHER EDUCATION ACT OF 1965 214 (B) served on active duty and was discharged or re- leased therefrom because of a service connected disability; (C) was a member of a reserve component of the Armed Forces called to active duty for a period of more than 30 days; or (D) was a member of a reserve component of the Armed Forces who served on active duty in support of a contingency operation (as that term is defined in section 101(a)(13) of title 10, United States Code) on or after Sep- tember 11, 2001.
(6) WAIVER.—The Secretary may waive the service require- ments in subparagraph (A), (B), or (C) of paragraph (5) if the Secretary determines the application of the service require- ments to a veteran will defeat the purpose of a program under this chapter.

SEC.

402B.

ø20 U.S.C.

1070a–12¿ TALENT SEARCH.
(a) PROGRAM AUTHORITY.—The Secretary shall carry out a pro- gram to be known as talent search which shall be designed— (1) to identify qualified youths with potential for education at the postsecondary level and to encourage such youths to complete secondary school and to undertake a program of post- secondary education; (2) to publicize the availability of, and facilitate the appli- cation for, student financial assistance available to persons who pursue a program of postsecondary education; and (3) to encourage persons who have not completed programs of education at the secondary or postsecondary level to enter or reenter, and complete such programs.
(b) REQUIRED SERVICES.—Any project assisted under this sec- tion shall provide— (1) connections to high quality academic tutoring services, to enable students to complete secondary or postsecondary courses; (2) advice and assistance in secondary course selection and, if applicable, initial postsecondary course selection; (3) assistance in preparing for college entrance examina- tions and completing college admission applications; (4)(A) information on the full range of Federal student fi- nancial aid programs and benefits (including Federal Pell Grant awards and loan forgiveness) and resources for locating public and private scholarships; and (B) assistance in completing financial aid applications, in- cluding the Free Application for Federal Student Aid described in section 483(a); (5) guidance on and assistance in— (A) secondary school reentry; (B) alternative education programs for secondary school dropouts that lead to the receipt of a regular sec- ondary school diploma; (C) entry into general educational development (GED) programs; or (D) postsecondary education; and September 8, 2023 As Amended Through P.L.
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402B (6) connections to education or counseling services de- signed to improve the financial literacy and economic literacy of students or the students’ parents, including financial plan- ning for postsecondary education.
(c) PERMISSIBLE SERVICES.—Any project assisted under this section may provide services such as— (1) academic tutoring, which may include instruction in reading, writing, study skills, mathematics, science, and other subjects; (2) personal and career counseling or activities; (3) information and activities designed to acquaint youth with the range of career options available to the youth; (4) exposure to the campuses of institutions of higher edu- cation, as well as cultural events, academic programs, and other sites or activities not usually available to disadvantaged youth; (5) workshops and counseling for families of students served; (6) mentoring programs involving elementary or secondary school teachers or counselors, faculty members at institutions of higher education, students, or any combination of such per- sons; and (7) programs and activities as described in subsection (b) or paragraphs (1) through (6) of this subsection that are spe- cially designed for students who are limited English proficient, students from groups that are traditionally underrepresented in postsecondary education, students with disabilities, students who are homeless children and youths (as such term is defined in section 725 of the McKinney-Vento Homeless Assistance Act (42 U.S.C.
11434a)), students who are in foster care or are aging out of the foster care system, or other disconnected stu- dents.
(d) REQUIREMENTS FOR APPROVAL OF APPLICATIONS.—In ap- proving applications for projects under this section for any fiscal year the Secretary shall— (1) require an assurance that not less than two-thirds of the individuals participating in the project proposed to be car- ried out under any application be low-income individuals who are first generation college students; (2) require that such participants be persons who either have completed 5 years of elementary education or are at least 11 years of age but not more than 27 years of age, unless the imposition of any such limitation with respect to any person would defeat the purposes of this section or the purposes of section 402F; (3) require an assurance that individuals participating in the project proposed in the application do not have access to services from another project funded under this section or under section 402F; and (4) require an assurance that the project will be located in a setting accessible to the persons proposed to be served by the project.
September 8, 2023 As Amended Through P.L.

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402C HIGHER EDUCATION ACT OF 1965 216 SEC.

402C.

ø20 U.S.C.

1070a–13¿ UPWARD BOUND.


(a) PROGRAM AUTHORITY.—The Secretary shall carry out a pro- gram to be known as upward bound which shall be designed to generate skills and motivation necessary for success in education beyond secondary school.
(b) REQUIRED SERVICES.—Any project assisted under this sec- tion shall provide— (1) academic tutoring to enable students to complete sec- ondary or postsecondary courses, which may include instruc- tion in reading, writing, study skills, mathematics, science, and other subjects; (2) advice and assistance in secondary and postsecondary course selection; (3) assistance in preparing for college entrance examina- tions and completing college admission applications; (4)(A) information on the full range of Federal student fi- nancial aid programs and benefits (including Federal Pell Grant awards and loan forgiveness) and resources for locating public and private scholarships; and (B) assistance in completing financial aid applications, in- cluding the Free Application for Federal Student Aid described in section 483(a); (5) guidance on and assistance in— (A) secondary school reentry; (B) alternative education programs for secondary school dropouts that lead to the receipt of a regular sec- ondary school diploma; (C) entry into general educational development (GED) programs; or (D) postsecondary education; and (6) education or counseling services designed to improve the financial literacy and economic literacy of students or the students’ parents, including financial planning for postsec- ondary education.
(c) ADDITIONAL REQUIRED SERVICES FOR MULTIPLE-YEAR GRANT RECIPIENTS.—Any project assisted under this section which has received funding for two or more years shall include, as part of the core curriculum in the next and succeeding years, instruction in mathematics through precalculus, laboratory science, foreign language, composition, and literature.
(d) PERMISSIBLE SERVICES.—Any project assisted under this section may provide such services as— (1) exposure to cultural events, academic programs, and other activities not usually available to disadvantaged youth; (2) information, activities, and instruction designed to ac- quaint youth participating in the project with the range of ca- reer options available to the youth; (3) on-campus residential programs; (4) mentoring programs involving elementary school or sec- ondary school teachers or counselors, faculty members at insti- tutions of higher education, students, or any combination of such persons; September 8, 2023 As Amended Through P.L.
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402C (5) work-study positions where youth participating in the project are exposed to careers requiring a postsecondary de- gree; (6) special services, including mathematics and science preparation, to enable veterans to make the transition to post- secondary education; and (7) programs and activities as described in subsection (b), subsection (c), or paragraphs (1) through (6) of this subsection that are specially designed for students who are limited English proficient, students from groups that are traditionally underrepresented in postsecondary education, students with disabilities, students who are homeless children and youths (as such term is defined in section 725 of the McKinney-Vento Homeless Assistance Act (42 U.S.C.
11434a)), students who are in foster care or are aging out of the foster care system, or other disconnected students.
(e) REQUIREMENTS FOR APPROVAL OF APPLICATIONS.—In ap- proving applications for projects under this section for any fiscal year, the Secretary shall— (1) require an assurance that not less than two-thirds of the youths participating in the project proposed to be carried out under any application be low-income individuals who are first generation college students; (2) require an assurance that the remaining youths partici- pating in the project proposed to be carried out under any ap- plication be low-income individuals, first generation college students, or students who have a high risk for academic fail- ure; (3) require that there be a determination by the institu- tion, with respect to each participant in such project that the participant has a need for academic support in order to pursue successfully a program of education beyond secondary school; (4) require that such participants be persons who have completed 8 years of elementary education and are at least 13 years of age but not more than 19 years of age, unless the im- position of any such limitation would defeat the purposes of this section; and (5) require an assurance that no student will be denied participation in a project assisted under this section because the student will enter the project after the 9th grade.
(f) MAXIMUM STIPENDS.—Youths participating in a project pro- posed to be carried out under any application may be paid stipends not in excess of $60 per month during the summer school recess, for a period not to exceed three months, except that youth partici- pating in a work-study position under subsection (d)(5) may be paid a stipend of $300 per month during the summer school recess, for a period not to exceed three months.
Youths participating in a project proposed to be carried out under any application may be paid stipends not in excess of $40 per month during the remaining period of the year.

(g) ADDITIONAL FUNDS.— (1) AUTHORIZATION AND APPROPRIATION.—There are au- thorized to be appropriated, and there are appropriated to the Secretary, from funds not otherwise appropriated, $57,000,000 September 8, 2023 As Amended Through P.L.
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402D HIGHER EDUCATION ACT OF 1965 218 for each of the fiscal years 2008 through 2011 to carry out paragraph (2), except that any amounts that remain unex- pended for such purpose for each of such fiscal years may be available for technical assistance and administration costs for the Upward Bound program.
The authority to award grants under this subsection shall expire at the end of fiscal year 2011.

(2) USE OF FUNDS.—The amounts made available by para- graph (1) shall be available to provide assistance to all Upward Bound projects that did not receive assistance in fiscal year 2007 and that have a grant score above 70.

Such assistance shall be made available in the form of 4-year grants.
(h) ABSOLUTE PRIORITY PROHIBITED IN UPWARD BOUND PRO- GRAM.—Upon enactment of this subsection and except as otherwise expressly provided by amendment to this section, the Secretary shall not continue, implement, or enforce the absolute priority for the Upward Bound Program published by the Department of Edu- cation in the Federal Register on September 22, 2006 (71 Fed.

Reg.

55447 et seq.).

This subsection shall not be applied retroactively.
In implementing this subsection, the Department shall allow the programs and participants chosen in the grant cycle to which the priority applies to continue their grants and participation without a further recompetition.

The entities shall not be required to apply the absolute priority conditions or restrictions to future partici- pants.

SEC.

402D.

ø20 U.S.C.

1070a–14¿ STUDENT SUPPORT SERVICES.
(a) PROGRAM AUTHORITY.—The Secretary shall carry out a pro- gram to be known as student support services which shall be de- signed— (1) to increase college retention and graduation rates for eligible students; (2) to increase the transfer rates of eligible students from 2-year to 4-year institutions; (3) to foster an institutional climate supportive of the suc- cess of students who are limited English proficient, students from groups that are traditionally underrepresented in postsec- ondary education, students with disabilities, students who are homeless children and youths (as such term is defined in sec- tion 725 of the McKinney-Vento Homeless Assistance Act (42 U.S.C.
11434a)), students who are in foster care or are aging out of the foster care system, or other disconnected students; and (4) to improve the financial literacy and economic literacy of students, including— (A) basic personal income, household money manage- ment, and financial planning skills; and (B) basic economic decisionmaking skills.
(b) REQUIRED SERVICES.—A project assisted under this section shall provide— (1) academic tutoring, directly or through other services provided by the institution, to enable students to complete postsecondary courses, which may include instruction in read- September 8, 2023 As Amended Through P.L.
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402D ing, writing, study skills, mathematics, science, and other sub- jects; (2) advice and assistance in postsecondary course selection; (3)(A) information on both the full range of Federal stu- dent financial aid programs and benefits (including Federal Pell Grant awards and loan forgiveness) and resources for lo- cating public and private scholarships; and (B) assistance in completing financial aid applications, in- cluding the Free Application for Federal Student Aid described in section 483(a); (4) education or counseling services designed to improve the financial literacy and economic literacy of students, includ- ing financial planning for postsecondary education; (5) activities designed to assist students participating in the project in applying for admission to, and obtaining finan- cial assistance for enrollment in, graduate and professional programs; and (6) activities designed to assist students enrolled in two- year institutions of higher education in applying for admission to, and obtaining financial assistance for enrollment in, a four- year program of postsecondary education.
(c) PERMISSIBLE SERVICES.—A project assisted under this sec- tion may provide services such as— (1) individualized counseling for personal, career, and aca- demic matters provided by assigned counselors; (2) information, activities, and instruction designed to ac- quaint students participating in the project with the range of career options available to the students; (3) exposure to cultural events and academic programs not usually available to disadvantaged students; (4) mentoring programs involving faculty or upper class students, or a combination thereof; (5) securing temporary housing during breaks in the aca- demic year for— (A) students who are homeless children and youths (as such term is defined in section 725 of the McKinney-Vento Homeless Assistance Act (42 U.S.C.
11434a)) or were for- merly homeless children and youths; and (B) students who are in foster care or are aging out of the foster care system; and (6) programs and activities as described in subsection (b) or paragraphs (1) through (4) of this subsection that are spe- cially designed for students who are limited English proficient, students from groups that are traditionally underrepresented in postsecondary education, students with disabilities, students who are homeless children and youths (as such term is defined in section 725 of the McKinney-Vento Homeless Assistance Act (42 U.S.C.
11434a)), students who are in foster care or are aging out of the foster care system, or other disconnected stu- dents.

(d) SPECIAL RULE.— (1) USE FOR STUDENT AID.—A recipient of a grant that un- dertakes any of the permissible services identified in sub- section (c) may, in addition, use such funds to provide grant September 8, 2023 As Amended Through P.L.
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402D HIGHER EDUCATION ACT OF 1965 220 aid to students.
A grant provided under this paragraph shall not exceed the Federal Pell Grant amount, determined under section 401(b)(2)(A), for which a student is eligible, or be less than the minimum Federal Pell Grant amount described in section 401(b)(4), for the current academic year.

In making grants to students under this subsection, an institution shall ensure that adequate consultation takes place between the stu- dent support service program office and the institution’s finan- cial aid office.
(2) ELIGIBLE STUDENTS.—For purposes of receiving grant aid under this subsection, eligible students shall be current participants in the student support services program offered by the institution and be— (A) students who are in their first 2 years of postsec- ondary education and who are receiving Federal Pell Grants under subpart 1; or (B) students who have completed their first 2 years of postsecondary education and who are receiving Federal Pell Grants under subpart 1 if the institution dem- onstrates to the satisfaction of the Secretary that— (i) these students are at high risk of dropping out; and (ii) it will first meet the needs of all its eligible first- and second-year students for services under this paragraph.
(3) DETERMINATION OF NEED.—A grant provided to a stu- dent under paragraph (1) shall not be considered in deter- mining that student’s need for grant or work assistance under this title, except that in no case shall the total amount of stu- dent financial assistance awarded to a student under this title exceed that student’s cost of attendance, as defined in section 472.
(4) MATCHING REQUIRED.—A recipient of a grant who uses such funds for the purpose described in paragraph (1) shall match the funds used for such purpose, in cash, from non-Fed- eral funds, in an amount that is not less than 33 percent of the total amount of funds used for that purpose.
This paragraph shall not apply to any grant recipient that is an institution of higher education eligible to receive funds under part A or B of title III or title V. (5) RESERVATION.—In no event may a recipient use more than 20 percent of the funds received under this section for grant aid.

(6) SUPPLEMENT, NOT SUPPLANT.—Funds received by a grant recipient that are used under this subsection shall be used to supplement, and not supplant, non-Federal funds ex- pended for student support services programs.
(e) REQUIREMENTS FOR APPROVAL OF APPLICATIONS.—In ap- proving applications for projects under this section for any fiscal year, the Secretary shall— (1) require an assurance that not less than two-thirds of the persons participating in the project proposed to be carried out under any application— (A) be individuals with disabilities; or September 8, 2023 As Amended Through P.L.
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402E (B) be low-income individuals who are first generation college students; (2) require an assurance that the remaining students par- ticipating in the project proposed to be carried out under any application be low-income individuals, first generation college students, or individuals with disabilities; (3) require an assurance that not less than one-third of the individuals with disabilities participating in the project be low- income individuals; (4) require that there be a determination by the institu- tion, with respect to each participant in such project, that the participant has a need for academic support in order to pursue successfully a program of education beyond secondary school; (5) require that such participants be enrolled or accepted for enrollment at the institution which is the recipient of the grant or contract; and (6) consider, in addition to such other criteria as the Sec- retary may prescribe, the institution’s effort, and where appli- cable past history, in— (A) providing sufficient financial assistance to meet the full financial need of each student in the project; and (B) maintaining the loan burden of each such student at a manageable level.
SEC.

402E.

ø20 U.S.C.

1070a–15¿ POSTBACCALAUREATE ACHIEVEMENT PROGRAM AUTHORITY.

(a) PROGRAM AUTHORITY.—The Secretary shall carry out a pro- gram to be known as the ‘‘Ronald E. McNair Postbaccalaureate Achievement Program’’ that shall be designed to provide disadvan- taged college students with effective preparation for doctoral study.
(b) REQUIRED SERVICES.—A project assisted under this section shall provide— (1) opportunities for research or other scholarly activities at the institution or at graduate centers designed to provide students with effective preparation for doctoral study; (2) summer internships; (3) seminars and other educational activities designed to prepare students for doctoral study; (4) tutoring; (5) academic counseling; and (6) activities designed to assist students participating in the project in securing admission to and financial assistance for enrollment in graduate programs.
(c) PERMISSIBLE SERVICES.—A project assisted under this sec- tion may provide services such as— (1) education or counseling services designed to improve the financial literacy and economic literacy of students, includ- ing financial planning for postsecondary education; (2) mentoring programs involving faculty members at in- stitutions of higher education, students, or any combination of such persons; and (3) exposure to cultural events and academic programs not usually available to disadvantaged students.
September 8, 2023 As Amended Through P.L.

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402F HIGHER EDUCATION ACT OF 1965 222 (d) REQUIREMENTS.—In approving applications for projects as- sisted under this section for any fiscal year, the Secretary shall re- quire— (1) an assurance that not less than two-thirds of the indi- viduals participating in the project proposed to be carried out under any application be low-income individuals who are first generation college students; (2) an assurance that the remaining persons participating in the project proposed to be carried out be from a group that is underrepresented in graduate education, including— (A) Alaska Natives, as defined in section 6306 of the Elementary and Secondary Education Act of 1965; (B) Native Hawaiians, as defined in section 6207 of such Act; and (C) Native American Pacific Islanders, as defined in section 320; (3) an assurance that participants be enrolled in a degree program at an eligible institution having an agreement with the Secretary in accordance with the provisions of section 487; and (4) an assurance that participants in summer research in- ternships have completed their sophomore year in postsec- ondary education.
(e) AWARD CONSIDERATIONS.—In addition to such other selec- tion criteria as may be prescribed by regulations, the Secretary shall consider in making awards to institutions under this sec- tion— (1) the quality of research and other scholarly activities in which students will be involved; (2) the level of faculty involvement in the project and the description of the research in which students will be involved; and (3) the institution’s plan for identifying and recruiting par- ticipants including students enrolled in projects authorized under this section.
(f) MAXIMUM STIPENDS.—Students participating in research under a project under this section may receive an award that— (1) shall include a stipend not to exceed $2,800 per annum; and (2) may include, in addition, the costs of summer tuition, summer room and board, and transportation to summer pro- grams.
(g) FUNDING.—From amounts appropriated pursuant to the au- thority of section 402A(g), the Secretary shall, to the extent prac- ticable, allocate funds for projects authorized by this section in an amount which is not less than $11,000,000 for each of the fiscal years 2009 through 2014.

SEC.

402F.

ø20 U.S.C.

1070a–16¿ EDUCATIONAL OPPORTUNITY CENTERS.


(a) PROGRAM AUTHORITY; SERVICES PROVIDED.—The Secretary shall carry out a program to be known as educational opportunity centers which shall be designed— September 8, 2023 As Amended Through P.L.

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402F (1) to provide information with respect to financial and academic assistance available for individuals desiring to pur- sue a program of postsecondary education; (2) to provide assistance to such persons in applying for admission to institutions at which a program of postsecondary education is offered, including preparing necessary applications for use by admissions and financial aid officers; and (3) to improve the financial literacy and economic literacy of students, including— (A) basic personal income, household money manage- ment, and financial planning skills; and (B) basic economic decisionmaking skills.
(b) PERMISSIBLE SERVICES.—An educational opportunity center assisted under this section may provide services such as— (1) public information campaigns designed to inform the community regarding opportunities for postsecondary edu- cation and training; (2) academic advice and assistance in course selection; (3) assistance in completing college admission and finan- cial aid applications; (4) assistance in preparing for college entrance examina- tions; (5) education or counseling services designed to improve the financial literacy and economic literacy of students; (6) guidance on secondary school reentry or entry to a gen- eral educational development (GED) program or other alter- native education programs for secondary school dropouts; (7) individualized personal, career, and academic coun- seling; (8) tutorial services; (9) career workshops and counseling; (10) mentoring programs involving elementary or sec- ondary school teachers, faculty members at institutions of higher education, students, or any combination of such per- sons; and (11) programs and activities as described in paragraphs (1) through (10) that are specially designed for students who are limited English proficient, students from groups that are tradi- tionally underrepresented in postsecondary education, students with disabilities, students who are homeless children and youths (as such term is defined in section 725 of the McKin- ney-Vento Homeless Assistance Act (42 U.S.C.
11434a)), stu- dents who are in foster care or are aging out of the foster care system, or other disconnected students.
(c) REQUIREMENTS FOR APPROVAL OF APPLICATIONS.—In ap- proving applications for educational opportunity centers under this section for any fiscal year the Secretary shall— (1) require an assurance that not less than two-thirds of the persons participating in the project proposed to be carried out under any application be low-income individuals who are first generation college students; (2) require that such participants be persons who are at least nineteen years of age, unless the imposition of such limi- September 8, 2023 As Amended Through P.L.
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402G HIGHER EDUCATION ACT OF 1965 224 tation with respect to any person would defeat the purposes of this section or the purposes of section 402B; and (3) require an assurance that individuals participating in the project proposed in the application do not have access to services from another project funded under this section or under section 402B.

SEC.

402G.

ø20 U.S.C.

1070a–17¿ STAFF DEVELOPMENT ACTIVITIES.


(a) SECRETARY’S AUTHORITY.—For the purpose of improving the operation of the programs and projects authorized by this chapter, the Secretary is authorized to make grants to institutions of higher education and other public and private nonprofit institutions and organizations to provide training for staff and leadership personnel employed in, participating in, or preparing for employment in, such programs and projects.
(b) CONTENTS OF TRAINING PROGRAMS.—Such training shall in- clude conferences, internships, seminars, workshops, and the publi- cation of manuals designed to improve the operation of such pro- grams and projects and shall be carried out in the various regions of the Nation in order to ensure that the training opportunities are appropriate to meet the needs in the local areas being served by such programs and projects.
Such training shall be offered annu- ally for new directors of projects funded under this chapter as well as annually on the following topics and other topics chosen by the Secretary: (1) Legislative and regulatory requirements for the oper- ation of programs funded under this chapter.

(2) Assisting students in receiving adequate financial aid from programs assisted under this title and other programs.

(3) The design and operation of model programs for projects funded under this chapter.
(4) The use of appropriate educational technology in the operation of projects assisted under this chapter.

(5) Strategies for recruiting and serving hard to reach pop- ulations, including students who are limited English proficient, students from groups that are traditionally underrepresented in postsecondary education, students with disabilities, students who are homeless children and youths (as such term is defined in section 725 of the McKinney-Vento Homeless Assistance Act (42 U.S.C.
11434a)), students who are in foster care or are aging out of the foster care system, or other disconnected stu- dents.

(c) CONSULTATION.—Grants for the purposes of this section shall be made only after consultation with regional and State pro- fessional associations of persons having special knowledge with re- spect to the needs and problems of such programs and projects.

SEC.

402H.

ø20 U.S.C.

1070a–18¿ REPORTS, EVALUATIONS, AND GRANTS FOR PROJECT IMPROVEMENT AND DISSEMINATION.
(a) REPORTS TO THE AUTHORIZING COMMITTEES.— (1) IN GENERAL.—The Secretary shall submit annually, to the authorizing committees, a report that documents the per- formance of all programs funded under this chapter.

Such re- port shall— September 8, 2023 As Amended Through P.L.
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402H (A) be submitted not later than 12 months after the el- igible entities receiving funds under this chapter are re- quired to report their performance to the Secretary; (B) focus on the programs’ performance on the rel- section criteria determined under outcome evant 402A(f)(4); (C) aggregate individual project performance data on the outcome criteria in order to provide national perform- ance data for each program; (D) include, when appropriate, descriptive data, multi- year data, and multi-cohort data; and (E) include comparable data on the performance na- tionally of low-income students, first-generation students, and students with disabilities.
(2) INFORMATION.—The Secretary shall provide, with each report submitted under paragraph (1), information on the im- pact of the secondary review process described in section 402A(c)(8)(C)(iv), including the number and type of secondary reviews, the disposition of the secondary reviews, the effect on timing of awards, and any other information the Secretary de- termines is necessary.
(b) EVALUATIONS.— (1) IN GENERAL.— (A) AUTHORIZATION OF GRANTS AND CONTRACTS.—For the purpose of improving the effectiveness of the programs and projects assisted under this chapter, the Secretary shall make grants to, or enter into contracts with, institu- tions of higher education and other public and private in- stitutions and organizations to rigorously evaluate the ef- fectiveness of the programs and projects assisted under this chapter, including a rigorous evaluation of the pro- grams and projects assisted under section 402C.
The eval- uation of the programs and projects assisted under section 402C shall be implemented not later than June 30, 2010.

(B) CONTENT OF UPWARD BOUND EVALUATION.—The evaluation of the programs and projects assisted under section 402C that is described in subparagraph (A) shall examine the characteristics of the students who benefit most from the Upward Bound program under section 402C and the characteristics of the programs and projects that most benefit students.
(C) IMPLEMENTATION.—Each evaluation described in this paragraph shall be implemented in accordance with the requirements of this section.
(2) PRACTICES.— (A) IN GENERAL.—The evaluations described in para- graph (1) shall identify institutional, community, and pro- gram or project practices that are effective in— (i) enhancing the access of low-income individuals and first-generation college students to postsecondary education; (ii) the preparation of such individuals and stu- dents for postsecondary education; and September 8, 2023 As Amended Through P.L.
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402H HIGHER EDUCATION ACT OF 1965 226 (iii) fostering the success of the individuals and students in postsecondary education.
(B) PRIMARY PURPOSE.—Any evaluation conducted under this chapter shall have as the evaluation’s primary purpose the identification of particular practices that fur- ther the achievement of the outcome criteria determined under section 402A(f)(4).

(C) DISSEMINATION AND USE OF EVALUATION FIND- INGS.—The Secretary shall disseminate to eligible entities and make available to the public the practices identified under subparagraph (B).
The practices may be used by eli- gible entities that receive assistance under this chapter after the dissemination.
(3) SPECIAL RULE RELATED TO EVALUATION PARTICIPA- TION.—The Secretary shall not require an eligible entity, as a condition for receiving, or that receives, assistance under any program or project under this chapter to participate in an eval- uation under this section that— (A) requires the eligible entity to recruit additional students beyond those the program or project would nor- mally recruit; or (B) results in the denial of services for an eligible stu- dent under the program or project.
(4) CONSIDERATION.—When designing an evaluation under this subsection, the Secretary shall continue to consider— (A) the burden placed on the program participants or the eligible entity; and (B) whether the evaluation meets generally accepted standards of institutional review boards.
(c) GRANTS.—The Secretary may award grants to institutions of higher education or other private and public institutions and or- ganizations, that are carrying out a program or project assisted under this chapter prior to the date of enactment of the Higher Education Amendments of 1998, to enable the institutions and or- ganizations to expand and leverage the success of such programs or projects by working in partnership with other institutions, com- munity-based organizations, or combinations of such institutions and organizations, that are not receiving assistance under this chapter and are serving low-income students and first generation college students, in order to— (1) disseminate and replicate best practices of programs or projects assisted under this chapter; and (2) provide technical assistance regarding programs and projects assisted under this chapter.
(d) RESULTS.—In order to improve overall program or project effectiveness, the results of evaluations and grants described in this section shall be disseminated by the Secretary to similar pro- grams or projects assisted under this subpart, as well as other indi- viduals concerned with postsecondary access for and retention of low-income individuals and first-generation college students.

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404A CHAPTER 2—GAINING EARLY AWARENESS AND READINESS FOR UNDERGRADUATE PROGRAMS SEC.

404A.

ø20 U.S.C.

1070a–21¿ EARLY INTERVENTION AND COLLEGE AWARENESS PROGRAM AUTHORIZED.
(a) PROGRAM AUTHORIZED.—The Secretary is authorized, in ac- cordance with the requirements of this chapter, to establish a pro- gram that encourages eligible entities to provide support, and maintain a commitment, to eligible low-income students, including students with disabilities, to assist the students in obtaining a sec- ondary school diploma (or its recognized equivalent) and to prepare for and succeed in postsecondary education, by providing— (1) financial assistance, academic support, additional coun- seling, mentoring, outreach, and supportive services to sec- ondary school students, including students with disabilities, to reduce— (A) the risk of such students dropping out of school; or (B) the need for remedial education for such students at the postsecondary level; and (2) information to students and their families about the ad- vantages of obtaining a postsecondary education and, college fi- nancing options for the students and their families.
(b) AWARDS.— (1) IN GENERAL.—From funds appropriated under section 404H for each fiscal year, the Secretary shall make awards to eligible entities described in paragraphs (1) and (2) of sub- section (c) to enable the entities to carry out the program au- thorized under subsection (a).
(2) AWARD PERIOD.—The Secretary may award a grant under this chapter to an eligible entity described in paragraphs (1) and (2) of subsection (c) for— (A) six years; or (B) in the case of an eligible entity that applies for a grant under this chapter for seven years to enable the eli- gible entity to provide services to a student through the student’s first year of attendance at an institution of high- er education, seven years.
(3) PRIORITY.—In making awards to eligible entities de- scribed in subsection (c)(1), the Secretary shall— (A) give priority to eligible entities that— (i) on the day before the date of enactment of the Higher Education Opportunity Act, carried out suc- cessful educational opportunity programs under this chapter (as this chapter was in effect on such day); and (ii) have a prior, demonstrated commitment to early intervention leading to college access through collaboration and replication of successful strategies; and (B) ensure that students served under this chapter on the day before the date of enactment of the Higher Edu- September 8, 2023 As Amended Through P.L.
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404B HIGHER EDUCATION ACT OF 1965 228 cation Opportunity Act continue to receive assistance through the completion of secondary school.
(c) DEFINITION OF ELIGIBLE ENTITY.—For the purposes of this chapter, the term ‘‘eligible entity’’ means— (1) a State; or (2) a partnership— (A) consisting of— (i) one or more local educational agencies; and (ii) one or more degree granting institutions of higher education; and (B) which may include not less than two other commu- nity organizations or entities, such as businesses, profes- sional organizations, State agencies, institutions or agen- cies sponsoring programs authorized under subpart 4, or other public or private agencies or organizations.
SEC.

404B.

ø20 U.S.C.

1070a–22¿ REQUIREMENTS.
(a) FUNDING RULES.—In awarding grants from the amount ap- propriated under section 404H for a fiscal year, the Secretary shall make available— (1) to eligible entities described in section 404A(c)(1), not less than 33 percent of such amount; (2) to eligible entities described in section 404A(c)(2), not less than 33 percent of such amount; and (3) to eligible entities described in paragraph (1) or (2) of section 404A(c), the remainder of such amount taking into con- sideration the number, quality, and promise of the applications for the grants, and, to the extent practicable— (A) the geographic distribution of such grant awards; and (B) the distribution of such grant awards between urban and rural applicants.
(b) COORDINATION.—Each eligible entity shall ensure that the activities assisted under this chapter are, to the extent practicable, coordinated with, and complement and enhance— (1) services under this chapter provided by other eligible entities serving the same school district or State; and (2) related services under other Federal or non-Federal programs.
(c) DESIGNATION OF FISCAL AGENT.—An eligible entity de- scribed in section 404A(c)(2) shall designate an institution of higher education or a local educational agency as the fiscal agent for the eligible entity.
(d) COHORT APPROACH.— (1) IN GENERAL.—The Secretary shall require that eligible entities described in section 404A(c)(2)— (A) provide services under this chapter to at least one grade level of students, beginning not later than 7th grade, in a participating school that has a 7th grade and in which at least 50 percent of the students enrolled are eligible for free or reduced-price lunch under the Richard B. Russell National School Lunch Act (or, if an eligible entity deter- mines that it would promote the effectiveness of a pro- gram, an entire grade level of students, beginning not later September 8, 2023 As Amended Through P.L.
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404C than the 7th grade, who reside in public housing as de- fined in section 3(b)(1) of the United States Housing Act of 1937); (B) ensure that the services are provided through the 12th grade to students in the participating grade level and provide the option of continued services through the stu- dent’s first year of attendance at an institution of higher education to the extent the provision of such services was described in the eligible entity’s application for assistance under this chapter; and (C) provide services under this chapter to students who have received services under a previous GEAR UP grant award but have not yet completed the 12th grade.
(2) COORDINATION REQUIREMENT.—In order for the Sec- retary to require the cohort approach described in paragraph (1), the Secretary shall, where applicable, ensure that the co- hort approach is done in coordination and collaboration with existing early intervention programs and does not duplicate the services already provided to a school or community.
(e) SUPPLEMENT, NOT SUPPLANT.—Grant funds awarded under this chapter shall be used to supplement, and not supplant, other Federal, State, and local funds that would otherwise be expended to carry out activities assisted under this chapter.

SEC.

404C.

ø20 U.S.C.

1070a–23¿ APPLICATIONS.


(a) APPLICATION REQUIRED FOR ELIGIBILITY.— (1) IN GENERAL.—In order for an eligible entity to qualify for a grant under this chapter, the eligible entity shall submit to the Secretary an application for carrying out the program under this chapter.
(2) CONTENTS.—Each application submitted pursuant to paragraph (1) shall be in such form, contain or be accompanied by such information or assurances, and be submitted at such time as the Secretary may reasonably require.
Each such ap- plication shall, at a minimum— (A) describe the activities for which assistance under this chapter is sought, including how the eligible entity will carry out the required activities described in section 404D(a); (B) describe, in the case of an eligible entity described in section 404A(c)(2) that chooses to provide scholarships, or an eligible entity described in section 404A(c)(1), how the eligible entity will meet the requirements of section 404E; (C) describe, in the case of an eligible entity described in section 404A(c)(2) that requests a reduced match per- centage under subsection (b)(2), how such reduction will assist the entity to provide the scholarships described in subsection (b)(2)(A)(ii); (D) provide assurances that adequate administrative and support staff will be responsible for coordinating the activities described in section 404D; (E) provide assurances that activities assisted under this chapter will not displace an employee or eliminate a September 8, 2023 As Amended Through P.L.
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404C HIGHER EDUCATION ACT OF 1965 230 position at a school assisted under this chapter, including a partial displacement such as a reduction in hours, wages, or employment benefits; (F) describe, in the case of an eligible entity described in section 404A(c)(1) that chooses to use a cohort approach, or an eligible entity described in section 404A(c)(2), how the eligible entity will define the cohorts of the students served by the eligible entity pursuant to section 404B(d), and how the eligible entity will serve the cohorts through grade 12, including— (i) how vacancies in the program under this chap- ter will be filled; and (ii) how the eligible entity will serve students at- tending different secondary schools; (G) describe how the eligible entity will coordinate pro- grams under this chapter with other existing Federal, State, or local programs to avoid duplication and maximize the number of students served; (H) provide such additional assurances as the Sec- retary determines necessary to ensure compliance with the requirements of this chapter; (I) provide information about the activities that will be carried out by the eligible entity to support systemic changes from which future cohorts of students will benefit; and (J) describe the sources of matching funds that will en- able the eligible entity to meet the matching requirement described in subsection (b).
(b) MATCHING REQUIREMENT.— (1) IN GENERAL.—The Secretary shall not approve an ap- plication submitted under subsection (a) unless such applica- tion— (A) provides that the eligible entity will provide, from State, local, institutional, or private funds, not less than 50 percent of the cost of the program, which matching funds may be provided in cash or in kind and may be ac- crued over the full duration of the grant award period, ex- cept that the eligible entity shall make substantial progress towards meeting the matching requirement in each year of the grant award period; (B) specifies the methods by which matching funds will be paid; and (C) includes provisions designed to ensure that funds provided under this chapter shall supplement and not sup- plant funds expended for existing programs.
(2) SPECIAL RULE.—Notwithstanding the matching require- ment described in paragraph (1)(A), the Secretary may by reg- ulation modify the percentage requirement described in para- graph (1)(A) for eligible entities described in section 404A(c)(2).

The Secretary may approve an eligible entity’s request for a re- duced match percentage— (A) at the time of application— September 8, 2023 As Amended Through P.L.
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404D (i) if the eligible entity demonstrates significant economic hardship that precludes the eligible entity from meeting the matching requirement; or (ii) if the eligible entity is described in section 404A(c)(2) and requests that contributions to the eligi- ble entity’s scholarship fund established under section 404E be matched on a two to one basis; or (B) in response to a petition by an eligible entity sub- sequent to a grant award under this section if the eligible entity demonstrates that the matching funds described in its application are no longer available and the eligible enti- ty has exhausted all revenues for replacing such matching funds.
(c) METHODS FOR COMPLYING WITH MATCHING REQUIRE- MENT.—An eligible entity may count toward the matching require- ment described in subsection (b)(1)(A)— (1) the amount of the financial assistance obligated to stu- dents from State, local, institutional, or private funds under this chapter, including pre-existing non-Federal financial as- sistance programs, including— (A) the amount contributed to a student scholarship fund established under section 404E; and (B) the amount of the costs of administering the schol- arship program under section 404E; (2) the amount of tuition, fees, room or board waived or re- duced for recipients of financial assistance under this chapter; (3) the amount expended on documented, targeted, long- term mentoring and counseling provided by volunteers or paid staff of nonschool organizations, including businesses, religious organizations, community groups, postsecondary educational institutions, nonprofit and philanthropic organizations, and other organizations; and (4) other resources recognized by the Secretary, including equipment and supplies, cash contributions from non-Federal sources, transportation expenses, in-kind or discounted pro- gram services, indirect costs, and facility usage.
(d) PEER REVIEW PANELS.—The Secretary shall convene peer review panels to assist in making determinations regarding the awarding of grants under this chapter.

SEC.

404D.

ø20 U.S.C.

1070a–24¿ ACTIVITIES.

(a) REQUIRED ACTIVITIES.—Each eligible entity receiving a grant under this chapter shall provide comprehensive mentoring, outreach, and supportive services to students participating in the programs under this chapter.
Such activities shall include the fol- lowing: (1) Providing information regarding financial aid for post- secondary education to participating students in the cohort de- scribed in section 404B(d)(1)(A) or to priority students de- scribed in subsection (d).

(2) Encouraging student enrollment in rigorous and chal- lenging curricula and coursework, in order to reduce the need for remedial coursework at the postsecondary level.
(3) Improving the number of participating students who— September 8, 2023 As Amended Through P.L.

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404D HIGHER EDUCATION ACT OF 1965 232 (A) obtain a secondary school diploma; and (B) complete applications for and enroll in a program of postsecondary education.
(4) In the case of an eligible entity described in section 404A(c)(1), providing for the scholarships described in section 404E.

(b) PERMISSIBLE ACTIVITIES FOR STATES AND PARTNERSHIPS.— An eligible entity that receives a grant under this chapter may use grant funds to carry out one or more of the following activities: (1) Providing tutors and mentors, who may include adults or former participants of a program under this chapter, for eli- gible students.
(2) Conducting outreach activities to recruit priority stu- dents described in subsection (d) to participate in program ac- tivities.

(3) Providing supportive services to eligible students.

(4) Supporting the development or implementation of rig- orous academic curricula, which may include college pre- paratory, Advanced Placement, or International Baccalaureate programs, and providing participating students access to rig- orous core academic courses that reflect challenging State aca- demic standards.
(5) Supporting dual or concurrent enrollment programs be- tween the secondary school and institution of higher education partners of an eligible entity described in section 404A(c)(2), and other activities that support participating students in— (A) meeting challenging State academic standards; (B) successfully applying for postsecondary education; (C) successfully applying for student financial aid; and (D) developing graduation and career plans.
(6) Providing special programs or tutoring in science, tech- nology, engineering, or mathematics.

(7) In the case of an eligible entity described in section 404A(c)(2), providing support for scholarships described in sec- tion 404E.

(8) Introducing eligible students to institutions of higher education, through trips and school-based sessions.
(9) Providing an intensive extended school day, school year, or summer program that offers— (A) additional academic classes; or (B) assistance with college admission applications.
(10) Providing other activities designed to ensure sec- ondary school completion and postsecondary education enroll- ment of at-risk children, such as— (A) the identification of at-risk children; (B) after-school and summer tutoring; (C) assistance to at-risk children in obtaining summer jobs; (D) academic counseling; (E) financial literacy and economic literacy education or counseling; (F) volunteer and parent involvement; (G) encouraging former or current participants of a program under this chapter to serve as peer counselors; September 8, 2023 As Amended Through P.L.
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404D (H) skills assessments; (I) personal and family counseling, and home visits; (J) staff development; and (K) programs and activities described in this sub- section that are specially designed for students who are limited English proficient.
(11) Enabling eligible students to enroll in Advanced Placement or International Baccalaureate courses, or college entrance examination preparation courses.

(12) Providing services to eligible students in the partici- pating cohort described in section 404B(d)(1)(A), through the first year of attendance at an institution of higher education.
(13) Fostering and improving parent and family involve- ment in elementary and secondary education by promoting the advantages of a college education, and emphasizing academic admission requirements and the need to take college prepara- tion courses, through parent engagement and leadership activi- ties.
(14) Disseminating information that promotes the impor- tance of higher education, explains college preparation and ad- mission requirements, and raises awareness of the resources and services provided by the eligible entities to eligible stu- dents, their families, and communities.
(15) In the event that matching funds described in the ap- plication are no longer available, engaging entities described in section 404A(c)(2) in a collaborative manner to provide match- ing resources and participate in other activities authorized under this section.
(c) ADDITIONAL PERMISSIBLE ACTIVITIES FOR STATES.—In addi- tion to the required activities described in subsection (a) and the permissible activities described in subsection (b), an eligible entity described in section 404A(c)(1) receiving funds under this chapter may use grant funds to carry out one or more of the following ac- tivities: (1) Providing technical assistance to— (A) secondary schools that are located within the State; or (B) partnerships described in section 404A(c)(2) that are located within the State.
(2) Providing professional development opportunities to in- dividuals working with eligible cohorts of students described in section 404B(d)(1)(A).

(3) Providing administrative support to help build the ca- pacity of eligible entities described in section 404A(c)(2) to com- pete for and manage grants awarded under this chapter.
(4) Providing strategies and activities that align efforts in the State to prepare eligible students to attend and succeed in postsecondary education, which may include the development of graduation and career plans.

(5) Disseminating information on the use of scientifically valid research and best practices to improve services for eligi- ble students.

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404E HIGHER EDUCATION ACT OF 1965 234 (6)(A) Disseminating information on effective coursework and support services that assist students in obtaining the goals described in subparagraph (B)(ii).
(B) Identifying and disseminating information on best practices with respect to— (i) increasing parental involvement; and (ii) preparing students, including students with dis- abilities and students who are limited English proficient, to succeed academically in, and prepare financially for, postsecondary education.

(7) Working to align State academic standards and cur- ricula with the expectations of postsecondary institutions and employers.
(8) Developing alternatives to traditional secondary school that give students a head start on attaining a recognized post- secondary credential (including an industry-recognized certifi- cate, an apprenticeship, or an associate’s or a bachelor’s de- gree), including school designs that give students early expo- sure to college-level courses and experiences and allow stu- dents to earn transferable college credits or an associate’s de- gree at the same time as a secondary school diploma.
(9) Creating community college programs for drop-outs that are personalized drop-out recovery programs that allow drop-outs to complete a regular secondary school diploma and begin college-level work.
(d) PRIORITY STUDENTS.—For eligible entities not using a co- hort approach, the eligible entity shall treat as a priority student any student in secondary school who is— (1) eligible to be counted under section 1124(c) of the Ele- mentary and Secondary Education Act of 1965; (2) eligible for assistance under a State program funded under part A or E of title IV of the Social Security Act (42 U.S.C.

601 et seq., 670 et seq.


); (3) eligible for assistance under subtitle B of title VII of the McKinney-Vento Homeless Assistance Act (42 U.S.C.

11431 et seq.

); or (4) otherwise considered by the eligible entity to be a dis- connected student.
(e) ALLOWABLE PROVIDERS.—In the case of eligible entities de- scribed in section 404A(c)(1), the activities required by this section may be provided by service providers such as community-based or- ganizations, schools, institutions of higher education, public and private agencies, nonprofit and philanthropic organizations, busi- nesses, institutions and agencies sponsoring programs authorized under subpart 4, and other organizations the State determines ap- propriate.

SEC.

404E.

ø20 U.S.C.


1070a–25¿ SCHOLARSHIP COMPONENT.

10 (a) IN GENERAL.— 10 Subsection (i) of section 404 of Public Law 110–315 provides as follows: (i) ø20 U.S.C.

1070a–25 note¿ EFFECTIVE DATE; TRANSITION.— (1) IN GENERAL.—The amendments made by subsection (e) shall apply to grants made under chapter 2 of subpart 2 of part A of title IV of the Higher Education Act of 1965 (20 U.S.C.

1070a–21 et seq.)
1070a–21 et seq.)

on or after the date of enactment of this Act, except that a recipi- ent of a grant under such chapter that is made prior to such date may elect to apply the September 8, 2023 As Amended Through P.L.

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404E (1) STATES.—In order to receive a grant under this chap- ter, an eligible entity described in section 404A(c)(1) shall es- tablish or maintain a financial assistance program that awards scholarships to students in accordance with the requirements of this section.

The Secretary shall encourage the eligible enti- ty to ensure that a scholarship provided pursuant to this sec- tion is available to an eligible student for use at any institution of higher education.
(2) PARTNERSHIPS.—An eligible entity described in section 404A(c)(2) may award scholarships to eligible students in ac- cordance with the requirements of this section.
(b) LIMITATION.— (1) IN GENERAL.—Subject to paragraph (2), each eligible entity described in section 404A(c)(1) that receives a grant under this chapter shall use not less than 25 percent and not more than 50 percent of the grant funds for activities described in section 404D (except for the activity described in subsection (a)(4) of such section), with the remainder of such funds to be used for a scholarship program under this section in accord- ance with such subsection.
(2) EXCEPTION.—Notwithstanding paragraph (1), the Sec- retary may allow an eligible entity to use more than 50 percent of grant funds received under this chapter for such activities, if the eligible entity demonstrates that the eligible entity has another means of providing the students with the financial as- sistance described in this section and describes such means in the application submitted under section 404C.
(c) NOTIFICATION OF ELIGIBILITY.—Each eligible entity pro- viding scholarships under this section shall provide information on the eligibility requirements for the scholarships to all participating students upon the students’ entry into the programs assisted under this chapter.

(d) GRANT AMOUNTS.—The maximum amount of a scholarship that an eligible student shall be eligible to receive under this sec- tion shall be established by the eligible entity.
The minimum amount of the scholarship for each fiscal year shall not be less than the minimum Federal Pell Grant award under section 401 for such award year.
(e) PORTABILITY OF ASSISTANCE.— (1) IN GENERAL.—Each eligible entity described in section 404A(c)(1) that receives a grant under this chapter shall hold in reserve, for the students served by such grant as described in section 404B(d)(1)(A) or 404D(d), an amount that is not less than the minimum scholarship amount described in subsection (d), multiplied by the number of students the eligible entity es- timates will meet the requirements of paragraph (2).
(2) REQUIREMENT FOR PORTABILITY.—Funds held in reserve under paragraph (1) shall be made available to an eligible stu- dent when the eligible student has— requirements contained in the amendments made by subsection (e) to that grant if the grant recipient informs the Secretary of the election.

(2) SPECIAL RULE.—A grant recipient may make the election described in paragraph (1) only if the election does not decrease the amount of the scholarship promised to an indi- vidual student under the grant.
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404E HIGHER EDUCATION ACT OF 1965 236 (A) completed a secondary school diploma, its recog- nized equivalent, or another recognized alternative stand- ard for individuals with disabilities; and (B) enrolled in an institution of higher education.
(3) QUALIFIED EDUCATIONAL EXPENSES.—Funds available to an eligible student under this subsection may be used for— (A) tuition, fees, books, supplies, and equipment re- quired for the enrollment or attendance of the eligible stu- dent at an institution of higher education; and (B) in the case of an eligible student with special needs, expenses for special needs services that are in- curred in connection with such enrollment or attendance.
(4) RETURN OF FUNDS.— (A) REDISTRIBUTION.— (i) IN GENERAL.—Funds held in reserve under paragraph (1) that are not used by an eligible student within six years of the student’s scheduled completion of secondary school may be redistributed by the eligi- ble entity to other eligible students.
(ii) RETURN OF EXCESS TO THE SECRETARY.—If, after meeting the requirements of paragraph (1) and, if applicable, redistributing excess funds in accordance with clause (i) of this subparagraph, an eligible entity has funds held in reserve under paragraph (1) that re- main available, the eligible entity shall return such re- maining reserved funds to the Secretary for distribu- tion to other grantees under this chapter in accord- ance with the funding rules described in section 404B(a).
(B) NONPARTICIPATING ENTITY.—Notwithstanding sub- paragraph (A), in the case of an eligible entity that does not receive assistance under this subpart for six fiscal years, the eligible entity shall return any funds held in re- serve under paragraph (1) that are not awarded or obli- gated to eligible students to the Secretary for distribution to other grantees under this chapter.
(f) RELATION TO OTHER ASSISTANCE.—Scholarships provided under this section shall not be considered for the purpose of award- ing Federal grant assistance under this title, except that in no case shall the total amount of student financial assistance awarded to a student under this title exceed such student’s total cost of attend- ance.
(g) ELIGIBLE STUDENTS.—A student eligible for assistance under this section is a student who— (1) is less than 22 years old at time of first scholarship award under this section; (2) receives a secondary school diploma or its recognized equivalent on or after January 1, 1993; (3) is enrolled or accepted for enrollment in a program of undergraduate instruction at an institution of higher education that is located within the State’s boundaries, except that, at the State’s option, an eligible entity may offer scholarship pro- gram portability for recipients who attend institutions of high- er education outside such State; and September 8, 2023 As Amended Through P.L.
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404H (4) who participated in the activities required under sec- tion 404D(a).

SEC.

404F.

ø20 U.S.C.

1070a–26¿ 21ST CENTURY SCHOLAR CERTIFI- CATES.


(a) IN GENERAL.—An eligible entity that receives a grant under this chapter shall provide certificates, to be known as 21st Century Scholar Certificates, to all students served by the eligible entity who are participating in a program under this chapter.
(b) INFORMATION REQUIRED.—A 21st Century Scholar Certifi- cate shall be personalized for each student and indicate the amount of Federal financial aid for college and the estimated amount of any scholarship provided under section 404E, if applicable, that a student may be eligible to receive.

SEC.

404G.

ø20 U.S.C.

1070a–27¿ EVALUATION AND REPORT.


(a) EVALUATION.—Each eligible entity receiving a grant under this chapter shall biennially evaluate the activities assisted under this chapter in accordance with the standards described in sub- section (b) and shall submit to the Secretary a copy of such evalua- tion.
The evaluation shall permit service providers to track eligible student progress during the period such students are participating in the activities and shall be consistent with the standards devel- oped by the Secretary pursuant to subsection (b).

(b) EVALUATION STANDARDS.—The Secretary shall prescribe standards for the evaluation described in subsection (a).
Such standards shall— (1) provide for input from eligible entities and service pro- viders; and (2) ensure that data protocols and procedures are con- sistent and uniform.
(c) FEDERAL EVALUATION.—In order to evaluate and improve the impact of the activities assisted under this chapter, the Sec- retary shall, from not more than 0.75 percent of the funds appro- priated under section 404H for a fiscal year, award one or more grants, contracts, or cooperative agreements to or with public and private institutions and organizations, to enable the institutions and organizations to evaluate the effectiveness of the program and, as appropriate, disseminate the results of the evaluation.
Such evaluation shall include a separate analysis of— (1) the implementation of the scholarship component de- scribed in section 404E; and (2) the use of methods for complying with matching re- quirements described in paragraphs (1) and (2) of section 404C(c).

(d) REPORT.—The Secretary shall biennially report to Congress regarding the activities assisted under this chapter and the evalua- tions conducted pursuant to this section.

SEC.

404H.

ø20 U.S.C.

1070a–28¿ AUTHORIZATION OF APPROPRIATIONS.


There are authorized to be appropriated to carry out this chap- ter $400,000,000 for fiscal year 2009 and such sums as may be nec- essary for each of the five succeeding fiscal years.

øChapter 3 was repealed by section 405 of P.L.

110–315¿ September 8, 2023 As Amended Through P.L.


117-286, Enacted December 27, 2022 HOLC G:\COMP\EDIII\HIGHER EDUCATION ACT OF 1965.XML Sec.

413A HIGHER EDUCATION ACT OF 1965 238 øChapters 4 through 8 repealed by section 405 of P.L.

105– 244¿ SUBPART 3—FEDERAL SUPPLEMENTAL EDUCATIONAL OPPORTUNITY GRANTS SEC.

413A.

ø20 U.S.C.

1070b¿ PURPOSE; APPROPRIATIONS AUTHORIZED.


(a) PURPOSE OF SUBPART.—It is the purpose of this subpart to provide, through institutions of higher education, supplemental grants to assist in making available the benefits of postsecondary education to qualified students who demonstrate financial need in accordance with the provisions of part F of this title.
(b) AUTHORIZATION OF APPROPRIATIONS.—(1) For the purpose of enabling the Secretary to make payments to institutions of higher education which have made agreements with the Secretary in ac- cordance with section 413C(a), for use by such institutions for pay- ments to undergraduate students of supplemental grants awarded to them under this subpart, there are authorized to be appro- priated such sums as may be necessary for fiscal year 2009 and each of the five succeeding fiscal years.
(2) Sums appropriated pursuant to this subsection for any fis- cal year shall be available for payments to institutions until the end of the second fiscal year succeeding the fiscal year for which such sums were appropriated.

SEC.

413B.

ø20 U.S.C.

1070b–1¿ AMOUNT AND DURATION OF GRANTS.
(a) AMOUNT OF GRANT.—(1) Except as provided in paragraph (3), from the funds received by it for such purpose under this sub- part, an institution which awards a supplemental grant to a stu- dent for an academic year under this subpart shall, for each year, pay to that student an amount not to exceed the lesser of (A) the amount determined by the institution, in accordance with the pro- visions of part F of this title, to be needed by that student to enable the student to pursue a course of study at the institution or in a program of study abroad that is approved for credit by the institu- tion at which the student is enrolled, or (B) $4,000.
(2) If the amount determined under paragraph (1) with respect to a student for any academic year is less than $100, no payment shall be made to that student for that year.

For a student enrolled for less than a full academic year, the minimum payment required shall be reduced proportionately.

(3) For students participating in study abroad programs, the institution shall consider all reasonable costs associated with such study abroad when determining student eligibility.
The amount of grant to be awarded in such cases may exceed the maximum amount of $4,000 by as much as $400 if reasonable study abroad costs exceed the cost of attendance at the home institution.

(b) PERIOD FOR RECEIPT OF GRANTS; CONTINUING ELIGI- BILITY.—(1) The period during which a student may receive supple- mental grants shall be the period required for the completion of the first undergraduate baccalaureate course of study being pursued by that student.
(2) A supplemental grant awarded under this subpart shall en- title the student (to whom it is awarded) to payments pursuant to September 8, 2023 As Amended Through P.L.

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413C such grant only if the student meets the requirements of section 484, except as provided in section 413C(c).

(c) DISTRIBUTION OF GRANT DURING ACADEMIC YEAR.—Nothing in this section shall be construed to prohibit an institution from making payments of varying amounts from a supplemental grant to a student during an academic year to cover costs for a period which are not applicable to other periods of such academic year.

SEC.

413C.

ø20 U.S.C.


1070b–2¿ AGREEMENTS WITH INSTITUTIONS; SE- LECTION OF RECIPIENTS.
(a) INSTITUTIONAL ELIGIBILITY.—Assistance may be made available under this subpart only to an institution which— (1) has, in accordance with section 487, an agreement with the Secretary applicable to this subpart; (2) agrees that the Federal share of awards under this sub- part will not exceed 75 percent of such awards, except that the Federal share may be exceeded if the Secretary determines, pursuant to regulations establishing objective criteria for such determinations, that a larger Federal share is required to fur- ther the purpose of this subpart; and (3) agrees that the non-Federal share of awards made under this subpart shall be made from the institution’s own re- sources, including— (A) institutional grants and scholarships; (B) tuition or fee waivers; (C) State scholarships; and (D) foundation or other charitable organization funds.
(b) ELIGIBILITY FOR SELECTION.—Awards may be made under this subpart only to a student who— (1) is an eligible student under section 484; and (2) makes application at a time and in a manner consistent with the requirements of the Secretary and that institution.
(c) SELECTION OF INDIVIDUALS AND DETERMINATION OF AMOUNT OF AWARDS.—(1) From among individuals who are eligible for supplemental grants for each fiscal year, the institution shall, in accordance with the agreement under section 487, and within the amount allocated to the institution for that purpose for that year under section 413D, select individuals who are to be awarded such grants and determine, in accordance with section 413B, the amounts to be paid to them.
(2)(A) In carrying out paragraph (1) of this subsection, each in- stitution of higher education shall, in the agreement made under section 487, assure that the selection procedures— (i) will be designed to award supplemental grants under this subpart, first, to students with exceptional need, and (ii) will give a priority for supplemental grants under this subpart to students who receive Pell Grants and meet the re- quirements of section 484.
(B) For the purpose of subparagraph (A), the term ‘‘students with exceptional need’’ means students with the lowest expected family contributions 1 at the institution.

(d) USE OF FUNDS FOR LESS-THAN-FULL-TIME STUDENTS.—If the institution’s allocation under this subpart is directly or indi- rectly based in part on the financial need demonstrated by students who are independent students or attending the institution on less September 8, 2023 As Amended Through P.L.
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413D HIGHER EDUCATION ACT OF 1965 240 than a full-time basis, then a reasonable proportion of the alloca- tion shall be made available to such students.
(e) USE AND TRANSFER OF FUNDS FOR ADMINISTRATIVE EX- PENSES.—An agreement entered into pursuant to this section shall provide that funds granted to an institution of higher education may be used only to make payments to students participating in a grant program authorized under this subpart, except that an in- stitution may use a portion of the sums allocated to it under this subpart to meet administrative expenses in accordance with section 489 of this title.

SEC.

413D.

ø20 U.S.C.


1070b–3¿ ALLOCATION OF FUNDS.

(a) ALLOCATION BASED ON PREVIOUS ALLOCATION 11.—(1) From the amount appropriated pursuant to section 413A(b) for each fis- cal year, the Secretary shall first allocate to each eligible institu- tion an amount equal to 100 percent of the amount such institution received under subsections (a) and (b) of this section for fiscal year 1999 (as such subsections were in effect with respect to allocations for such fiscal year).
(2)(A) From the amount so appropriated, the Secretary shall next allocate to each eligible institution that began participation in the program under this subpart after fiscal year 1999 but is not a first or second time participant, an amount equal to the greater of— (i) $5,000; or (ii) 90 percent of the amount received and used under this subpart for the first year it participated in the program.
(B) From the amount so appropriated, the Secretary shall next allocate to each eligible institution that began participation in the program under this subpart after fiscal year 1999 and is a first or second time participant, an amount equal to the greatest of— (i) $5,000; (ii) an amount equal to (I) 90 percent of the amount re- ceived and used under this subpart in the second preceding fis- cal year by eligible institutions offering comparable programs of instruction, divided by (II) the number of students enrolled at such comparable institutions in such fiscal year, multiplied by (III) the number of students enrolled at the applicant insti- tution in such fiscal year; or (iii) 90 percent of the institution’s allocation under this part for the preceding fiscal year.
(C) Notwithstanding subparagraphs (A) and (B) of this para- graph, the Secretary shall allocate to each eligible institution which (i) was a first-time participant in the program in fiscal year 2000 or any subsequent fiscal year, and (ii) received a larger amount under this subsection in the second year of participation, an amount equal to 90 percent of the amount it received under this subsection in its second year of participation.
11 The allocation provisions of section 413D of the Higher Education Act of 1965 were amend- ed by section 406(c) of the Higher Education Amendments of 1998 (P.L.

105–244; 112 Stat.

1665).


Paragraph (3) of that section 406(c) contained the following effective date provision: (3) EFFECTIVE DATE.—The amendments made by this subsection shall apply with respect to allocations of amounts appropriated pursuant to section 413A(b) of the Higher Education Act of 1965 for fiscal year 2000 or any succeeding fiscal year.

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413D (3)(A) If the amount appropriated for any fiscal year is less than the amount required to be allocated to all institutions under paragraph (1) of this subsection, then the amount of the allocation to each such institution shall be ratably reduced.
(B) If the amount appropriated for any fiscal year is more than the amount required to be allocated to all institutions under para- graph (1) but less than the amount required to be allocated to all institutions under paragraph (2), then— (i) the Secretary shall allot the amount required to be allo- cated to all institutions under paragraph (1), and (ii) the amount of the allocation to each institution under paragraph (2) shall be ratably reduced.
(C) If additional amounts are appropriated for any such fiscal year, such reduced amounts shall be increased on the same basis as they were reduced (until the amount allocated equals the amount required to be allocated under paragraphs (1) and (2) of this subsection).
(4)(A) Notwithstanding any other provision of this section, the Secretary may allocate an amount equal to not more than 10 per- cent of the amount by which the amount appropriated in any fiscal year to carry out this part exceeds $700,000,000 among eligible in- stitutions described in subparagraph (B).
(B) In order to receive an allocation pursuant to subparagraph (A) an institution shall be an eligible institution from which 50 per- cent or more of the Pell Grant recipients attending such eligible in- stitution graduate from or transfer to a 4-year institution of higher education.
(b) ALLOCATION OF EXCESS BASED ON FAIR SHARE.—(1) From the remainder of the amount appropriated pursuant to section 413A(b) for each year (after making the allocations required by subsection (a)), the Secretary shall allocate to each eligible institu- tion which has an excess eligible amount an amount which bears the same ratio to such remainder as such excess eligible amount bears to the sum of the excess eligible amounts of all such eligible institutions (having such excess eligible amounts).
(2) For any eligible institution, the excess eligible amount is the amount, if any, by which— (A)(i) the amount of that institution’s need (as determined under subsection (c)), divided by (ii) the sum of the need of all institutions (as so determined), multiplied by (iii) the amount appropriated pursuant to section 413A(b) of the fiscal year; ex- ceeds (B) the amount required to be allocated to that institution under subsection (a).
(c) DETERMINATION OF INSTITUTION’S NEED.—(1) The amount of an institution’s need is equal to— (A) the sum of the need of the institution’s eligible under- graduate students; minus (B) the sum of grant aid received by students under sub- parts 1 and 3 of this part.

(2) To determine the need of an institution’s eligible under- graduate students, the Secretary shall— (A) establish various income categories for dependent and independent undergraduate students; September 8, 2023 As Amended Through P.L.
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413D HIGHER EDUCATION ACT OF 1965 242 (B) establish an expected family contribution 1 for each in- come category of dependent and independent undergraduate students, determined on the basis of the average expected fam- ily contribution 1 (computed in accordance with part F of this title) of a representative sample within each income category for the second preceding fiscal year; (C) compute 75 percent of the average cost of attendance for all undergraduate students; (D) multiply the number of eligible dependent students in each income category by 75 percent of the average cost of at- tendance for all undergraduate students determined under subparagraph (C), minus the expected family contribution 1 de- termined under subparagraph (B) for that income category, ex- cept that the amount computed by such subtraction shall not be less than zero; (E) add the amounts determined under subparagraph (D) for each income category of dependent students; (F) multiply the number of eligible independent students in each income category by 75 percent of the average cost of attendance for all undergraduate students determined under subparagraph (C), minus the expected family contribution 1 de- termined under subparagraph (B) for that income category, ex- cept that the amount computed by such subtraction shall not be less than zero; (G) add the amounts determined under subparagraph (F) for each income category of independent students; and (H) add the amounts determined under subparagraphs (E) and (G).
(3)(A) For purposes of paragraph (2), the term ‘‘average cost of attendance’’ means the average of the attendance costs for under- graduate students which shall include (i) tuition and fees deter- mined in accordance with subparagraph (B), (ii) standard living ex- penses determined in accordance with subparagraph (C), and (iii) books and supplies determined in accordance with subparagraph (D).
(B) The average undergraduate tuition and fees described in subparagraph (A)(i) shall be computed on the basis of information reported by the institution to the Secretary, which shall include (i) total revenue received by the institution from undergraduate tui- tion and fees for the second year preceding the year for which it is applying for an allocation, and (ii) the institution’s enrollment for such second preceding year.
(C) The standard living expense described in subparagraph (A)(ii) is equal to 150 percent of the difference between the income protection allowance for a family of five with one in college and the income protection allowance for a family of six with one in college for a single independent student.

(D) The allowance for books and supplies described in subpara- graph (A)(iii) is equal to $600.
(d) REALLOCATION OF EXCESS ALLOCATIONS.—(1) If an institu- tion returns to the Secretary any portion of the sums allocated to such institution under this section for any fiscal year the Secretary shall, in accordance with regulations, reallocate such excess to other institutions.

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415A (2) If under paragraph (1) of this subsection an institution re- turns more than 10 percent of its allocation, the institution’s alloca- tion for the next fiscal year shall be reduced by the amount re- turned.
The Secretary may waive this paragraph for a specific in- stitution if the Secretary finds that enforcing this paragraph would be contrary to the interest of the program.

(e) FILING DEADLINES.—The Secretary shall, from time to time, set dates before which institutions must file applications for alloca- tions under this part.

SEC.

413E.

ø20 U.S.C.

1070b–4¿ CARRYOVER AND CARRYBACK AUTHOR- ITY.


(a) CARRYOVER AUTHORITY.—Of the sums made available to an eligible institution under this subpart for a fiscal year, not more than 10 percent may, at the discretion of the institution, remain available for expenditure during the succeeding fiscal year to carry out the program under this subpart.
(b) CARRYBACK AUTHORITY.— (1) IN GENERAL.—Of the sums made available to an eligi- ble institution under this subpart for a fiscal year, not more than 10 percent may, at the discretion of the institution, be used by the institution for expenditure for the fiscal year pre- ceding the fiscal year for which the sums were appropriated.
(2) USE OF CARRIED-BACK FUNDS.—An eligible institution may make grants to students after the end of the academic year, but prior to the beginning of the succeeding fiscal year, from such succeeding fiscal year’s appropriations.

SUBPART 4—LEVERAGING EDUCATIONAL ASSISTANCE PARTNERSHIP PROGRAM SEC.

415A.

ø20 U.S.C.

1070c¿ PURPOSE; APPROPRIATIONS AUTHORIZED.
(a) PURPOSE OF SUBPART.—It is the purpose of this subpart to make incentive grants available to States to assist States in— (1) providing grants to— (A) eligible students attending institutions of higher education or participating in programs of study abroad that are approved for credit by institutions of higher edu- cation at which such students are enrolled; and (B) eligible students for campus-based community service work-study; and (2) carrying out the activities described in section 415E.
(b) AUTHORIZATION OF APPROPRIATIONS; AVAILABILITY.— (1) IN GENERAL.—There are authorized to be appropriated to carry out this subpart $200,000,000 for fiscal year 2009 and such sums as may be necessary for each of the five succeeding fiscal years.

(2) RESERVATION.—For any fiscal year for which the amount appropriated under paragraph (1) exceeds $30,000,000, the excess amount shall be available to carry out section 415E.
(3) AVAILABILITY.—Sums appropriated pursuant to the au- thority of paragraph (1) for any fiscal year shall remain avail- able for payments to States under this subpart until the end of the fiscal year succeeding the fiscal year for which such sums were appropriated.

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415B HIGHER EDUCATION ACT OF 1965 244 SEC.

415B.

ø20 U.S.C.

1070c–1¿ ALLOTMENT AMONG STATES.
(a) ALLOTMENT BASED ON NUMBER OF ELIGIBLE STUDENTS IN ATTENDANCE.—(1) From the sums appropriated pursuant to section 415A(b)(1) and not reserved under section 415A(b)(2) for any fiscal year, the Secretary shall allot to each State an amount which bears the same ratio to such sums as the number of students who are deemed eligible in such State for participation in the grant pro- gram authorized by this subpart bears to the total number of such students in all the States, except that no State shall receive less than the State received for fiscal year 1979.
(2) For the purpose of this subsection, the number of students who are deemed eligible in a State for participation in the grant program authorized by this subpart, and the number of such stu- dents in all the States, shall be determined for the most recent year for which satisfactory data are available.
(b) REALLOTMENT.—The amount of any State’s allotment under subsection (a) for any fiscal year which the Secretary determines will not be required for such fiscal year for the leveraging edu- cational assistance partnership program of that State shall be available for reallotment from time to time, on such dates during such year as the Secretary may fix, to other States in proportion to the original allotments to such States under such part for such year, but with such proportionate amount for any of such States being reduced to the extent it exceeds the sum the Secretary esti- mates such State needs and will be able to use for such year for carrying out the State plan.
The total of such reductions shall be similarly reallotted among the States whose proportionate amounts were not so reduced.

Any amount reallotted to a State under this part during a year from funds appropriated pursuant to section 415A(b)(1) shall be deemed part of its allotment under subsection (a) for such year.

(c) ALLOTMENTS SUBJECT TO CONTINUING COMPLIANCE.—The Secretary shall make payments for continuing incentive grants only to States which continue to meet the requirements of section 415C(b).
SEC.

415C.

ø20 U.S.C.

1070c–2¿ APPLICATIONS FOR LEVERAGING EDU- CATIONAL ASSISTANCE PARTNERSHIP PROGRAMS.

(a) SUBMISSION AND CONTENTS OF APPLICATIONS.—A State which desires to obtain a payment under this subpart for any fiscal year shall submit annually an application therefor through the State agency administering its program under this subpart as of July 1, 1985, unless the Governor of that State so designates, in writing, a different agency to administer the program.
The applica- tion shall contain such information as may be required by, or pur- suant to, regulation for the purpose of enabling the Secretary to make the determinations required under this subpart.
(b) PAYMENT OF FEDERAL SHARE OF GRANTS MADE BY QUALI- FIED PROGRAM.—From a State’s allotment under this subpart for any fiscal year the Secretary is authorized to make payments to such State for paying up to 50 percent of the amount of student grants pursuant to a State program which— (1) is administered by a single State agency; (2) provides that such grants will be in amounts not to ex- ceed the lesser of $12,500 or the student’s cost of attendance September 8, 2023 As Amended Through P.L.
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415C per academic year (A) for attendance on a full-time basis at an institution of higher education, and (B) for campus-based com- munity service work learning study jobs; (3) provides that— (A) not more than 20 percent of the allotment to the State for each fiscal year may be used for the purpose de- scribed in paragraph (2)(B); (B) grants for the campus-based community work learning study jobs may be made only to students who are otherwise eligible for assistance under this subpart; and (C) grants for such jobs be made in accordance with the provisions of section 443(b)(1); (4) provides for the selection of recipients of such grants or of such State work-study jobs on the basis of substantial finan- cial need determined annually on the basis of criteria estab- lished by the State and approved by the Secretary, except that for the purpose of collecting data to make such determination of financial need, no student or parent shall be charged a fee that is payable to an entity other than such State; (5) provides that, effective with respect to any academic year beginning on or after October 1, 1978, all nonprofit insti- tutions of higher education in the State are eligible to partici- pate in the State program, except in any State in which par- ticipation of nonprofit institutions of higher education is in vio- lation of the constitution of the State or in any State in which participation of nonprofit institutions of higher education is in violation of a statute of the State which was enacted prior to October 1, 1978; (6) provides for the payment of the non-Federal portion of such grants or of such work-study jobs from funds supplied by such State which represent an additional expenditure for such year by such State for grants or work-study jobs for students attending institutions of higher education over the amount ex- pended by such State for such grants or work-study jobs, if any, during the second fiscal year preceding the fiscal year in which such State initially received funds under this subpart; (7)
 provides that if the State’s allocation under this sub- part is based in part on the financial need demonstrated by students who are independent students or attending the insti- tution less than full time, a reasonable proportion of the State’s allocation shall be made available to such students; (8) provides for State expenditures under such program of an amount not less than the average annual aggregate expend- itures for the preceding three fiscal years or the average an- nual expenditure per full-time equivalent student for such years; (9) provides (A) for such fiscal control and fund accounting procedures as may be necessary to assure proper disbursement of and accounting for Federal funds paid to the State agency under this subpart, and (B) for the making of such reports, in such form and containing such information, as may be reason- ably necessary to enable the Secretary to perform his functions under this subpart; September 8, 2023 As Amended Through P.L.
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415D HIGHER EDUCATION ACT OF 1965 246 (10) for any academic year beginning after June 30, 1987, provides the non-Federal share of the amount of student grants or work-study jobs under this subpart through State funds for the program under this subpart; and (11) provides notification to eligible students that such grants are— (A) Leveraging Educational Assistance Partnership Grants; and (B) funded by the Federal Government, the State, and, where applicable, other contributing partners.
(c) RESERVATION AND DISBURSEMENT OF ALLOTMENTS AND RE- ALLOTMENTS.—Upon his approval of any application for a payment under this subpart, the Secretary shall reserve from the applicable allotment (including any applicable reallotment) available therefor, the amount of such payment, which (subject to the limits of such allotment or reallotment) shall be equal to the Federal share of the cost of the students’ incentive grants or work-study jobs covered by such application.
The Secretary shall pay such reserved amount, in advance or by way of reimbursement, and in such installments as the Secretary may determine.

The Secretary may amend the res- ervation of any amount under this section, either upon approval of an amendment of the application or upon revision of the estimated cost of the student grants or work-study jobs with respect to which such reservation was made.
If the Secretary approves an upward revision of such estimated cost, the Secretary may reserve the Fed- eral share of the added cost only from the applicable allotment (or reallotment) available at the time of such approval.

SEC.

415D.

ø20 U.S.C.

1070c–3¿ ADMINISTRATION OF STATE PROGRAMS; JUDICIAL REVIEW.
(a) DISAPPROVAL OF APPLICATIONS; SUSPENSION OF ELIGI- BILITY.—(1) The Secretary shall not finally disapprove any applica- tion for a State program submitted under section 415C, or any modification thereof, without first affording the State agency sub- mitting the program reasonable notice and opportunity for a hear- ing.
(2) Whenever the Secretary, after reasonable notice and oppor- tunity for hearing to the State agency administering a State pro- gram approved under this subpart, finds— (A) that the State program has been so changed that it no longer complies with the provisions of this subpart, or (B) that in the administration of the program there is a failure to comply substantially with any such provisions, the Secretary shall notify such State agency that the State will not be regarded as eligible to participate in the program under this subpart until he is satisfied that there is no longer any such failure to comply.
(b) REVIEW OF DECISIONS.—(1) If any State is dissatisfied with the Secretary’s final action with respect to the approval of its State program submitted under this subpart or with his final action under subsection (a), such State may appeal to the United States court of appeals for the circuit in which such State is located.

The summons and notice of appeal may be served at any place in the United States.

The Commissioner shall forthwith certify and file in September 8, 2023 As Amended Through P.L.
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415E the court the transcript of the proceedings and the record on which he based his action.
(2) The findings of fact by the Secretary, if supported by sub- stantial evidence, shall be conclusive; but the court, for good cause shown, may remand the case to the Secretary to take further evi- dence, and the Secretary may thereupon make new or modified findings of fact and may modify his previous action, and shall cer- tify to the court the transcript and record of further proceedings.

Such new or modified findings of fact shall likewise be conclusive if supported by substantial evidence.
(3) The court shall have jurisdiction to affirm the action of the Secretary or to set it aside, in whole or in part.

The judgment of the court shall be subject to review by the Supreme Court of the United States upon certiorari or certification as provided in title 28, United States Code, section 1254.

SEC.

415E.

ø20 U.S.C.

1070c–3a¿ GRANTS FOR ACCESS AND PERSIST- ENCE.
(a) PURPOSE.—It is the purpose of this section to expand col- lege access and increase college persistence by making allotments to States to enable the States to— (1) expand and enhance partnerships with institutions of higher education, early information and intervention, men- toring, or outreach programs, private corporations, philan- thropic organizations, and other interested parties, including community-based organizations, in order to— (A) carry out activities under this section; and (B) provide coordination and cohesion among Federal, State, and local governmental and private efforts that pro- vide financial assistance to help low-income students at- tend an institution of higher education; (2) provide need-based grants for access and persistence to eligible low-income students; (3) provide early notification to low-income students of the students’ eligibility for financial aid; and (4) encourage increased participation in early information and intervention, mentoring, or outreach programs.
(b) ALLOTMENTS TO STATES.— (1) IN GENERAL.— (A) AUTHORIZATION.—From sums reserved under sec- tion 415A(b)(2) for each fiscal year, the Secretary shall make an allotment to each State that submits an applica- tion for an allotment in accordance with subsection (c) to enable the State to pay the Federal share, as described in paragraph (2), of the cost of carrying out the activities under subsection (d).
(B) DETERMINATION OF ALLOTMENT.—In making allot- ments under subparagraph (A), the Secretary shall con- sider the following: (i) CONTINUATION OF AWARD.—Except as provided in clause (ii), if a State continues to meet the specifica- tions established in such State’s application under subsection (c), the Secretary shall make an allotment to such State that is not less than the allotment made to such State for the previous fiscal year.

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415E HIGHER EDUCATION ACT OF 1965 248 (ii) SPECIAL CONTINUATION AND TRANSITION RULE.—If a State that applied for and received an al- lotment under this section for fiscal year 2010 pursu- ant to subsection (j) meets the specifications estab- lished in the State’s application under subsection (c) for fiscal year 2011, then the Secretary shall make an allotment to such State for fiscal year 2011 that is not less than the allotment made pursuant to subsection (j) to such State for fiscal year 2010 under this section (as this section was in effect on the day before the date of enactment of the Higher Education Oppor- tunity Act (Public Law 110–315)).
(iii) PRIORITY.—The Secretary shall give priority in making allotments to States that meet the require- ments described in paragraph (2)(B)(ii).

(2) FEDERAL SHARE.— (A) IN GENERAL.—The Federal share of the cost of car- rying out the activities under subsection (d) for any fiscal year shall not exceed 66.66 percent.
(B) DIFFERENT PERCENTAGES.—The Federal share under this section shall be determined in accordance with the following: (i) The Federal share of the cost of carrying out the activities under subsection (d) shall be 57 percent if a State applies for an allotment under this section in partnership with any number of degree-granting in- stitutions of higher education in the State whose com- bined full-time enrollment represents less than a ma- jority of all students attending institutions of higher education in the State, and— (I) philanthropic organizations that are lo- cated in, or that provide funding in, the State; or (II) private corporations that are located in, or that do business in, the State.
(ii) The Federal share of the cost of carrying out the activities under subsection (d) shall be 66.66 per- cent if a State applies for an allotment under this sec- tion in partnership with any number of degree-grant- ing institutions of higher education in the State whose combined full-time enrollment represents a majority of all students attending institutions of higher education in the State, and— (I) philanthropic organizations that are lo- cated in, or that provide funding in, the State; or (II) private corporations that are located in, or that do business in, the State.
(C) NON-FEDERAL SHARE.— (i) IN GENERAL.—The non-Federal share under this section may be provided in cash or in kind, fairly evaluated.

(ii) IN-KIND CONTRIBUTION.—For the purpose of calculating the non-Federal share under this subpara- graph, an in-kind contribution is a non-cash contribu- tion that— September 8, 2023 As Amended Through P.L.
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415E (I) has monetary value, such as the provision of— (aa) room and board; or (bb) transportation passes; and (II) helps a student meet the cost of attend- ance at an institution of higher education.
(iii) EFFECT ON NEED ANALYSIS.—For the purpose of calculating a student’s need in accordance with part F, an in-kind contribution described in clause (ii) shall not be considered an asset or income of the student or the student’s parent.
(c) APPLICATION FOR ALLOTMENT.— (1) IN GENERAL.— (A) SUBMISSION.—A State that desires to receive an al- lotment under this section on behalf of a partnership de- scribed in paragraph (3) shall submit an application to the Secretary at such time, in such manner, and containing such information as the Secretary may require.

(B) CONTENT.—An application submitted under sub- paragraph (A) shall include the following: (i) A description of the State’s plan for using the allotted funds.
(ii) An assurance that the State will provide matching funds, in cash or in kind, from State, institu- tional, philanthropic, or private funds, of not less than 33.33 percent of the cost of carrying out the activities under subsection (d).

The State shall specify the meth- ods by which matching funds will be paid.
A State that uses non-Federal funds to create or expand part- nerships with entities described in subsection (a)(1), in which such entities match State funds for student scholarships, may apply such matching funds from such entities toward fulfilling the State’s matching ob- ligation under this clause.

(iii) An assurance that the State will use funds provided under this section to supplement, and not supplant, Federal and State funds available for car- rying out the activities under this title.
(iv) An assurance that early information and intervention, mentoring, or outreach programs exist within the State or that there is a plan to make such programs widely available.

(v) A description of the organizational structure that the State has in place to administer the activities under subsection (d), including a description of how the State will compile information on degree comple- tion of students receiving grants under this section.
(vi) A description of the steps the State will take to ensure that students who receive grants under this section persist to degree completion.

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415E HIGHER EDUCATION ACT OF 1965 250 pected family contribution 12 determination described in section 479(c), to identify eligible low-income stu- dents and award State grant aid to such students.

(viii) An assurance that the State will provide no- tification to eligible low-income students that grants under this section are— (I) Leveraging Educational Assistance Part- nership Grants; and (II) funded by the Federal Government and the State, and, where applicable, other contrib- uting partners.
(2) STATE AGENCY.—The State agency that submits an ap- plication for a State under section 415C(a) shall be the same State agency that submits an application under paragraph (1) for such State.
(3) PARTNERSHIP.—In applying for an allotment under this section, the State agency shall apply for the allotment in part- nership with— (A) not less than one public and one private degree- granting institution of higher education that are located in the State, if applicable; (B) new or existing early information and intervention, mentoring, or outreach programs located in the State; and (C) not less than one— (i) philanthropic organization located in, or that provides funding in, the State; or (ii) private corporation located in, or that does business in, the State.
(4) ROLES OF PARTNERS.— (A) STATE AGENCY.—A State agency that is in a part- nership receiving an allotment under this section— (i) shall— for the partnership; (I) serve as the primary administrative unit (II) provide or coordinate non-Federal share funds, and coordinate activities among partners; (III) encourage each institution of higher edu- cation in the State to participate in the partner- ship; (IV) make determinations and early notifica- tions of assistance as described under subsection (d)(2); and (V) annually report to the Secretary on the partnership’s progress in meeting the purpose of this section; and (ii) may provide early information and interven- tion, mentoring, or outreach programs.
(B) DEGREE-GRANTING INSTITUTIONS OF HIGHER EDU- CATION.—A degree-granting institution of higher education that is in a partnership receiving an allotment under this section— 12 Effective on July 1, 2024, section 704(5) of division FF of Public Law 116–260 provides for an amendment to clause (vii) by striking ‘‘automatic zero expected family contribution’’ and in- serting ‘‘automatic zero student aid index’’.

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415E (i) shall— (I) recruit and admit participating qualified students and provide such additional institutional grant aid to participating students as agreed to with the State agency; (II) provide support services to students who receive grants for access and persistence under this section and are enrolled at such institution; and (III) assist the State in the identification of el- igible students and the dissemination of early no- tifications of assistance as agreed to with the State agency; and (ii) may provide funding for early information and intervention, mentoring, or outreach programs or pro- vide such services directly.
(C) PROGRAMS.—An early information and interven- tion, mentoring, or outreach program that is in a partner- ship receiving an allotment under this section shall pro- vide direct services, support, and information to partici- pating students.
(D) PHILANTHROPIC ORGANIZATION OR PRIVATE COR- PORATION.—A philanthropic organization or private cor- poration that is in a partnership receiving an allotment under this section shall provide funds for grants for access and persistence for participating students, or provide funds or support for early information and intervention, mentoring, or outreach programs.
(d) AUTHORIZED ACTIVITIES.— (1) IN GENERAL.— (A) ESTABLISHMENT OF PARTNERSHIP.—Each State re- ceiving an allotment under this section shall use the funds to establish a partnership to award grants for access and persistence to eligible low-income students in order to in- crease the amount of financial assistance such students re- ceive under this subpart for undergraduate education ex- penses.
(B) AMOUNT OF GRANTS.—The amount of a grant for access and persistence awarded by a State to a student under this section shall be not less than— (i) the average undergraduate tuition and manda- tory fees at the public institutions of higher education in the State where the student resides that are of the same type of institution as the institution of higher education the student attends; minus (ii) other Federal and State aid the student re- ceives.
(C) SPECIAL RULES.— (i) PARTNERSHIP INSTITUTIONS.—A State receiving an allotment under this section may restrict the use of grants for access and persistence under this section by awarding the grants only to students attending insti- tutions of higher education that are participating in the partnership.

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415E HIGHER EDUCATION ACT OF 1965 252 (ii) OUT-OF-STATE INSTITUTIONS.—If a State pro- vides grants through another program under this sub- part to students attending institutions of higher edu- cation located in another State, grants awarded under this section may be used at institutions of higher edu- cation located in another State.
(2) EARLY NOTIFICATION.— (A) IN GENERAL.—Each State receiving an allotment under this section shall annually notify low-income stu- dents in grades seven through 12 in the State, and their families, of their potential eligibility for student financial assistance, including an access and persistence grant, to attend an institution of higher education.
(B) CONTENT OF NOTICE.—The notice under subpara- graph (A)— (i) shall include— (I) information about early information and intervention, mentoring, or outreach programs available to the student; (II) information that a student’s eligibility for a grant for access and persistence is enhanced through participation in an early information and intervention, mentoring, or outreach program; (III) an explanation that student and family eligibility for, and participation in, other Federal means-tested programs may indicate eligibility for a grant for access and persistence and other stu- dent aid programs; (IV) a nonbinding estimate of the total amount of financial aid that a low-income student with a similar income level may expect to receive, including an estimate of the amount of a grant for access and persistence and an estimate of the amount of grants, loans, and all other available types of aid from the major Federal and State fi- nancial aid programs; (V) an explanation that in order to be eligible for a grant for access and persistence, at a min- imum, a student shall— (aa) meet the requirement under para- graph (3); (bb) graduate from secondary school; and (cc) enroll at an institution of higher edu- cation— (AA) that is a partner in the partner- ship; or (BB) with respect to which attend- is permitted under subsection ance (d)(1)(C)(ii); (VI) information on any additional require- ments (such as a student pledge detailing student responsibilities) that the State may impose for re- ceipt of a grant for access and persistence under this section; and September 8, 2023 As Amended Through P.L.
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415E (VII) instructions on how to apply for a grant for access and persistence and an explanation that a student is required to file a Free Application for Federal Student Aid authorized under section 483(a) to be eligible for such grant and assistance from other Federal and State financial aid pro- grams; and (ii) may include a disclaimer that grant awards for access and persistence are contingent on— (I) a determination of the student’s financial eligibility at the time of the student’s enrollment at an institution of higher education that is a partner in the partnership or qualifies under sub- section (d)(1)(C)(ii); (II) annual Federal and State spending for higher education; and (III) other aid received by the student at the time of the student’s enrollment at such institu- tion of higher education.
(3) ELIGIBILITY.—In determining which students are eligi- ble to receive grants for access and persistence, the State shall ensure that each such student complies with the following sub- paragraph (A) or (B): (A) Meets not less than two of the following criteria, with priority given to students meeting all of the following criteria: (i) Has an expected family contribution 1 equal to zero, as determined under part F, or a comparable al- ternative based upon the State’s approved criteria in section 415C(b)(4).
(ii) Qualifies for the State’s maximum under- graduate award, as authorized under section 415C(b).

(iii) Is participating in, or has participated in, a Federal, State, institutional, or community early infor- mation and intervention, mentoring, or outreach pro- gram, as recognized by the State agency administering activities under this section.

(B) Is receiving, or has received, a grant for access and persistence under this section, in accordance with para- graph (5).
(4) GRANT AWARD.—Once a student, including those stu- dents who have received early notification under paragraph (2) from the State, applies for admission to an institution that is a partner in the partnership, files a Free Application for Fed- eral Student Aid and any related State form, and is deter- mined eligible by the State under paragraph (3), the State shall— (A) issue the student a preliminary award certificate for a grant for access and persistence with estimated award amounts; and (B) inform the student that payment of the grant for access and persistence award amounts is subject to certifi- cation of enrollment and award eligibility by the institu- tion of higher education.
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415E HIGHER EDUCATION ACT OF 1965 254 (5) DURATION OF AWARD.—An eligible student who receives a grant for access and persistence under this section shall re- ceive such grant award for each year of such student’s under- graduate education in which the student remains eligible for assistance under this title, including pursuant to section 484(c), and remains financially eligible as determined by the State, except that the State may impose reasonable time limits to degree completion.
(e) ADMINISTRATIVE COST ALLOWANCE.—A State that receives an allotment under this section may reserve not more than two percent of the funds made available annually through the allot- ment for State administrative functions required to carry out this section.
(f) STATUTORY AND REGULATORY RELIEF FOR INSTITUTIONS OF HIGHER EDUCATION.—The Secretary may grant, upon the request of an institution of higher education that is in a partnership de- scribed in subsection (b)(2)(B)(ii) and that receives an allotment under this section, a waiver for such institution from statutory or regulatory requirements that inhibit the ability of the institution to successfully and efficiently participate in the activities of the part- nership.
(g) APPLICABILITY RULE.—The provisions of this subpart that are not inconsistent with this section shall apply to the program authorized by this section.
(h) MAINTENANCE OF EFFORT REQUIREMENT.—Each State re- ceiving an allotment under this section for a fiscal year shall pro- vide the Secretary with an assurance that the aggregate amount expended per student or the aggregate expenditures by the State, from funds derived from non-Federal sources, for the authorized ac- tivities described in subsection (d) for the preceding fiscal year were not less than the amount expended per student or the aggre- gate expenditure by the State for the activities for the second pre- ceding fiscal year.
(i) SPECIAL RULE.—Notwithstanding subsection (h), for pur- poses of determining a State’s share of the cost of the authorized activities described in subsection (d), the State shall consider only those expenditures from non-Federal sources that exceed the State’s total expenditures for need-based grants, scholarships, and work-study assistance for fiscal year 1999 (including any such as- sistance provided under this subpart).
(j) CONTINUATION AND TRANSITION.—For the two-year period that begins on the date of enactment of the Higher Education Op- portunity Act, the Secretary shall continue to award grants under section 415E of the Higher Education Act of 1965 as such section existed on the day before the date of enactment of the Higher Edu- cation Opportunity Act to States that choose to apply for grants under such predecessor section.
(k) REPORTS.—Not later than three years after the date of en- actment of the Higher Education Opportunity Act and annually thereafter, the Secretary shall submit a report describing the ac- tivities and the impact of the partnerships under this section to the authorizing committees.

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418A SEC.

415F.

ø20 U.S.C.

1070c–4¿ DEFINITION.
For the purpose of this subpart, the term ‘‘community service’’ means services, including direct service, planning, and applied re- search which are identified by an institution of higher education, through formal or informal consultation with local nonprofit, gov- ernmental, and community-based organizations, and which— (1) are designed to improve the quality of life for commu- nity residents, particularly low-income individuals, or to solve particular problems related to the needs of such residents, in- cluding but not limited to, such fields as health care, child care, education, literacy training, welfare, social services, pub- lic safety, crime prevention and control, transportation, recre- ation, housing and neighborhood improvement, rural develop- ment, and community improvement; and (2) provide participating students with work-learning op- portunities related to their educational or vocational programs or goals.
SUBPART 5—SPECIAL PROGRAMS FOR STUDENTS WHOSE FAMILIES ARE ENGAGED IN MIGRANT AND SEASONAL FARMWORK SEC.

418A.

ø20 U.S.C.

1070d–2¿ MAINTENANCE AND EXPANSION OF EX- ISTING PROGRAMS.
(a) PROGRAM AUTHORITY.—The Secretary shall maintain and expand existing secondary and postsecondary high school equiva- lency program and college assistance migrant program projects lo- cated at institutions of higher education or at private nonprofit or- ganizations working in cooperation with institutions of higher edu- cation.
(b) SERVICES PROVIDED BY HIGH SCHOOL EQUIVALENCY PRO- GRAM.—The services authorized by this subpart for the high school equivalency program include— (1) recruitment services to reach persons— (A)(i) who are 16 years of age and over; or (ii) who are beyond the age of compulsory school at- tendance in the State in which such persons reside and are not enrolled in school; (B)(i) who themselves, or whose immediate family, have spent a minimum of 75 days during the past 24 months in migrant and seasonal farmwork; or (ii) who are eligible to participate, or have participated within the preceding 2 years, in programs under part C of title I of the Elementary and Secondary Education Act of 1965 or section 167 of the Workforce Innovation and Op- portunity Act; and (C) who lack a high school diploma or its equivalent; (2) educational services which provide instruction designed to help students obtain a general education diploma which meets the guidelines established by the State in which the project is located for high school equivalency; (3) supportive services which include the following: (A) personal, vocational, and academic counseling; (B) placement services designed to place students in a university, college, or junior college program (including September 8, 2023 As Amended Through P.L.
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418A HIGHER EDUCATION ACT OF 1965 256 preparation for college entrance examinations), or in mili- tary service or career positions; and (C) health services; (4) information concerning, and assistance in obtaining, available student financial aid; (5) stipends for high school equivalency program partici- pants; (6) housing for those enrolled in residential programs; (7) exposure to cultural events, academic programs, and other educational and cultural activities usually not available to migrant youth; (8) other essential supportive services (such as transpor- tation and child care), as needed to ensure the success of eligi- ble students; and (9) other activities to improve persistence and retention in postsecondary education.
(c) SERVICES PROVIDED BY COLLEGE ASSISTANCE MIGRANT PRO- GRAM.—(1) Services authorized by this subpart for the college as- sistance migrant program include— (A) outreach and recruitment services to reach persons who themselves or whose immediate family have spent a min- imum of 75 days during the past 24 months in migrant and seasonal farmwork or who have participated or are eligible to participate, in programs under part C of title I of the Elemen- tary and Secondary Education Act of 1965 or section 167 of the Workforce Innovation and Opportunity Act, and who meet the minimum qualifications for attendance at a college or univer- sity; (B) supportive and instructional services to improve place- ment, persistence, and retention in postsecondary education, which include: (i) personal, academic, career, and economic education or personal finance counseling as an ongoing part of the program; (ii) tutoring and academic skill building instruction and assistance; (iii) assistance with special admissions; (iv) health services; and (v) other services as necessary to assist students in completing program requirements; (C) assistance in obtaining student financial aid which in- cludes, but is not limited to: (i) stipends; (ii) scholarships; (iii) student travel; (iv) career oriented work study; (v) books and supplies; (vi) tuition and fees; (vii) room and board; and (viii) other assistance necessary to assist students in completing their first year of college; (D) housing support for students living in institutional fa- cilities and commuting students; September 8, 2023 As Amended Through P.L.
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418A (E) exposure to cultural events, academic programs, and other activities not usually available to migrant youth; (F) internships; and (G) other essential supportive services (such as transpor- tation and child care) as necessary to ensure the success of eli- gible students.
(2) A recipient of a grant to operate a college assistance mi- grant program under this subpart shall provide followup services for migrant students after such students have completed their first year of college, and shall not use more than 10 percent of such grant for such followup services.
Such followup services may in- clude— (A) monitoring and reporting the academic progress of stu- dents who participated in the project during such student’s first year of college and during such student’s subsequent years in college; (B) referring such students to on- or off-campus providers of counseling services, academic assistance, or financial aid, and coordinating such services, assistance, and aid with other non-program services, assistance, and aid, including services, assistance, and aid provided by community-based organiza- tions, which may include mentoring and guidance; and (C) for students attending two-year institutions of higher education, encouraging the students to transfer to four-year in- stitutions of higher education, where appropriate, and moni- toring the rate of transfer of such students.
(d) MANAGEMENT PLAN REQUIRED.—Each project application shall include a management plan which contains assurances that the grant recipient will coordinate the project, to the extent fea- sible, with other local, State, and Federal programs to maximize the resources available for migrant students, and that staff shall have a demonstrated knowledge and be sensitive to the unique characteristics and needs of the migrant and seasonal farmworker population, and provisions for: (1) staff in-service training; (2) training and technical assistance; (3) staff travel; (4) student travel; (5) interagency coordination; and (6) an evaluation plan.
(e) FIVE-YEAR GRANT PERIOD; CONSIDERATION OF PRIOR EXPE- RIENCE.—Except under extraordinary circumstances, the Secretary shall award grants for a 5-year period.

For the purpose of making grants under this subpart, the Secretary shall consider the prior experience of service delivery under the particular project for which funds are sought by each applicant.
Such prior experience shall be awarded the same level of consideration given this factor for appli- cants for programs in accordance with section 402A(c)(2).

(f) MINIMUM ALLOCATIONS.—The Secretary shall not allocate an amount less than— (1) $180,000 for each project under the high school equiva- lency program, and (2) $180,000 for each project under the college assistance migrant program.

September 8, 2023 As Amended Through P.L.


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419A HIGHER EDUCATION ACT OF 1965 258 (g) RESERVATION AND ALLOCATION OF FUNDS.—From the amounts made available under subsection (i), the Secretary— (1) may reserve not more than a total of 1⁄2 of one percent for outreach activities, technical assistance, and professional development programs relating to the programs under sub- section (a); (2) for any fiscal year for which the amount appropriated to carry out this section is equal to or greater than $40,000,000, shall, in awarding grants from the remainder of such amounts— (A) make available not less than 45 percent of such re- mainder for the high school equivalency programs and not less than 45 percent of such remainder for the college as- sistance migrant programs; (B) award the rest of such remainder for high school equivalency programs or college assistance migrant pro- grams based on the number, quality, and promise of the applications; and (C) consider the need to provide an equitable geo- graphic distribution of such grants; and (3) for any fiscal year for which the amount appropriated to carry out this section is less than $40,000,000, shall, in awarding grants from the remainder of such amounts make available the same percentage of funds to the high school equivalency program and to the college assistance migrant pro- gram as was made available for each such program for the fis- cal year preceding the fiscal year for which the grant was made.
(h) DATA COLLECTION.—The Secretary shall— (1) annually collect data on persons receiving services au- thorized under this subpart regarding such persons’ rates of secondary school graduation, entrance into postsecondary edu- cation, and completion of postsecondary education, as applica- ble; (2) not less often than once every two years, prepare and submit to the authorizing committees a report based on the most recently available data under paragraph (1); and (3) make such report available to the public.
(i) AUTHORIZATION OF APPROPRIATIONS.—For the purpose of making grants and contracts under this section, there are author- ized to be appropriated $75,000,000 for fiscal year 2009 and such sums as may be necessary for the each of the five succeeding fiscal years.

SUBPART 6—ROBERT C. BYRD HONORS SCHOLARSHIP PROGRAM SEC.

419A.

ø20 U.S.C.

1070d–31¿ STATEMENT OF PURPOSE.


It is the purpose of this subpart to establish a Robert C. Byrd Honors Scholarship Program to promote student excellence and achievement and to recognize exceptionally able students who show promise of continued excellence.

SEC.

419C.

ø20 U.S.C.

1070d–33¿ SCHOLARSHIPS AUTHORIZED.

(a) PROGRAM AUTHORITY.—The Secretary is authorized, in ac- cordance with the provisions of this subpart, to make grants to September 8, 2023 As Amended Through P.L.
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419D States to enable the States to award scholarships to individuals who have demonstrated outstanding academic achievement and who show promise of continued academic achievement.
(b) PERIOD OF AWARD.—Scholarships under this section shall be awarded for a period of not less than 1 or more than 4 years during the first 4 years of study at any institution of higher edu- cation eligible to participate in any programs assisted under this title.
The State educational agency administering the program in a State shall have discretion to determine the period of the award (within the limits specified in the preceding sentence), except that— (1) if the amount appropriated for this subpart for any fis- cal year exceeds the amount appropriated for this subpart for fiscal year 1993, the Secretary shall identify to each State edu- cational agency the number of scholarships available to that State under section 419D(b) that are attributable to such ex- cess; and (2) the State educational agency shall award not less than that number of scholarships for a period of 4 years.
(c) USE AT ANY INSTITUTION PERMITTED.—A student awarded a scholarship under this subpart may attend any institution of higher education.

(d) BYRD SCHOLARS.—Individuals awarded scholarships under this subpart shall be known as ‘‘Byrd Scholars’’.

SEC.

419D.

ø20 U.S.C.

1070d–34¿ ALLOCATION AMONG STATES.


(a) ALLOCATION FORMULA.—From the sums appropriated pur- suant to the authority of section 419K for any fiscal year, the Sec- retary shall allocate to each State that has an agreement under section 419E an amount equal to $1,500 multiplied by the number of scholarships determined by the Secretary to be available to such State in accordance with subsection (b).
(b) NUMBER OF SCHOLARSHIPS AVAILABLE.—The number of scholarships to be made available in a State for any fiscal year shall bear the same ratio to the number of scholarships made avail- able to all States as the State’s population ages 5 through 17 bears to the population ages 5 through 17 in all the States, except that not less than 10 scholarships shall be made available to any State.
(c) USE OF CENSUS DATA.—For the purpose of this section, the population ages 5 through 17 in a State and in all the States shall be determined by the most recently available data, satisfactory to the Secretary, from the Bureau of the Census.

(d) CONSOLIDATION BY INSULAR AREAS PROHIBITED.—Notwith- standing section 501 of Public Law 95–134 (48 U.S.C.
1469a), funds allocated under this part to an Insular Area described in that sec- tion shall be deemed to be direct payments to classes of individ- uals, and the Insular Area may not consolidate such funds with other funds received by the Insular Area from any department or agency of the United States Government.
(e) FAS ELIGIBILITY.— (1) FISCAL YEARS 2000 THROUGH 2004.—Notwithstanding any other provision of this subpart, in the case of students from the Freely Associated States who may be selected to re- September 8, 2023 As Amended Through P.L.

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419E HIGHER EDUCATION ACT OF 1965 260 ceive a scholarship under this subpart for the first time for any of the fiscal years 2000 through 2004— (A) there shall be 10 scholarships in the aggregate awarded to such students for each of the fiscal years 2000 through 2004; and (B) the Pacific Regional Educational Laboratory shall administer the program under this subpart in the case of scholarships for students in the Freely Associated States.
(2) TERMINATION OF ELIGIBILITY.—A student from the Freely Associated States shall not be eligible to receive a schol- arship under this subpart after September 30, 2004.

SEC.

419E.

ø20 U.S.C.

1070d–35¿ AGREEMENTS.

The Secretary shall enter into an agreement with each State desiring to participate in the scholarship program authorized by this subpart.
Each such agreement shall include provisions de- signed to assure that— (1) the State educational agency will administer the schol- arship program authorized by this subpart in the State; (2) the State educational agency will comply with the eligi- bility and selection provisions of this subpart; (3) the State educational agency will conduct outreach ac- tivities to publicize the availability of scholarships under this subpart to all eligible students in the State, with particular emphasis on activities designed to assure that students from low-income and moderate-income families have access to the information on the opportunity for full participation in the scholarship program authorized by this subpart; and (4) the State educational agency will pay to each indi- vidual in the State who is awarded a scholarship under this subpart $1,500.
SEC.

419F.

ø20 U.S.C.

1070d–36¿ ELIGIBILITY OF SCHOLARS.
(a) HIGH SCHOOL GRADUATION OR EQUIVALENT AND ADMISSION TO INSTITUTION REQUIRED.—Each student awarded a scholarship under this subpart shall be a graduate of a public or private sec- ondary school (or a home school, whether treated as a home school or a private school under State law) or have the equivalent of a cer- tificate of graduation as recognized by the State in which the stu- dent resides and must have been admitted for enrollment at an in- stitution of higher education.
(b) SELECTION BASED ON PROMISE OF ACADEMIC ACHIEVE- MENT.—Each student awarded a scholarship under this subpart must demonstrate outstanding academic achievement and show promise of continued academic achievement.

SEC.

419G.

ø20 U.S.C.

1070d–37¿ SELECTION OF SCHOLARS.

(a) ESTABLISHMENT OF CRITERIA.—The State educational agen- cy is authorized to establish the criteria for the selection of scholars under this subpart.
(b) ADOPTION OF PROCEDURES.—The State educational agency shall adopt selection procedures designed to ensure an equitable geographic distribution of awards within the State (and in the case of the Federated States of Micronesia, the Republic of the Marshall Islands, the Virgin Islands, American Samoa, the Commonwealth of the Northern Mariana Islands, Guam, or Palau (until such time September 8, 2023 As Amended Through P.L.
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419N as the Compact of Free Association is ratified), not to exceed 10 in- dividuals will be selected from such entities).
(c) CONSULTATION REQUIREMENT.—In carrying out its respon- sibilities under subsections (a) and (b), the State educational agen- cy shall consult with school administrators, school boards, teachers, counselors, and parents.

(d) TIMING OF SELECTION.—The selection process shall be com- pleted, and the awards made, prior to the end of each secondary school academic year.

SEC.

419H.

ø20 U.S.C.

1070d–38¿ STIPENDS AND SCHOLARSHIP CONDI- TIONS.


(a) AMOUNT OF AWARD.—Each student awarded a scholarship under this subpart shall receive a stipend of $1,500 for the aca- demic year of study for which the scholarship is awarded, except that in no case shall the total amount of financial aid awarded to such student exceed such student’s total cost-of-attendance.
(b) USE OF AWARD.—The State educational agency shall estab- lish procedures to assure that a scholar awarded a scholarship under this subpart pursues a course of study at an institution of higher education.

SEC.

419J.

ø20 U.S.C.

1070d–40¿ 13 CONSTRUCTION OF NEEDS PROVI- SIONS.


Except as provided in section 471, nothing in this subpart, or any other Act, shall be construed to permit the receipt of a scholar- ship under this subpart to be counted for any needs test in connec- tion with the awarding of any grant or the making of any loan under this Act or any other provision of Federal law relating to educational assistance.

SEC.

419K.

ø20 U.S.C.

1070d–41¿ AUTHORIZATION OF APPROPRIATIONS.


There are authorized to be appropriated for this subpart such sums as may be necessary for fiscal year 2009 and each of the five succeeding fiscal years.

Subpart 7—Child Care Access Means Parents in School SEC.

419N.

ø20 U.S.C.

1070e¿ CHILD CARE ACCESS MEANS PARENTS IN SCHOOL.

(a) PURPOSE.—The purpose of this section is to support the participation of low-income parents in postsecondary education through the provision of campus-based child care services.
(b) PROGRAM AUTHORIZED.— (1) AUTHORITY.—The Secretary may award grants to insti- tutions of higher education to assist the institutions in pro- viding campus-based child care services to low-income stu- dents.

(2) AMOUNT OF GRANTS.— (A) IN GENERAL.—The amount of a grant awarded to an institution of higher education under this section for a fiscal year shall not exceed 1 percent of the total amount of all Federal Pell Grant funds awarded to students en- September 8, 2023 As Amended Through P.L.
117-286, Enacted December 27, 2022 13 Section 419I was repealed by P.L.

102–325, sec.

406(g)(1), 106 Stat.

509.

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419N HIGHER EDUCATION ACT OF 1965 262 rolled at the institution of higher education for the pre- ceding fiscal year.
(B) MINIMUM.— (i) IN GENERAL.—Except as provided in clause (ii), a grant under this section shall be awarded in an amount that is not less than $10,000.

(ii) INCREASE TRIGGER.—For any fiscal year for which the amount appropriated under the authority of subsection (g) is equal to or greater than $20,000,000, a grant under this section shall be awarded in an amount that is not less than $30,000.
(3) DURATION; RENEWAL; AND PAYMENTS.— (A) DURATION.—The Secretary shall award a grant under this section for a period of 4 years.

(B) PAYMENTS.—Subject to subsection (e)(2), the Sec- retary shall make annual grant payments under this sec- tion.
(4) ELIGIBLE INSTITUTIONS.—An institution of higher edu- cation shall be eligible to receive a grant under this section for a fiscal year if the total amount of all Federal Pell Grant funds awarded to students enrolled at the institution of higher edu- cation for the preceding fiscal year equals or exceeds $350,000, except that for any fiscal year for which the amount appro- priated to carry out this section is equal to or greater than $20,000,000, this sentence shall be applied by substituting ‘‘$250,000’’ for ‘‘$350,000’’.
(5) USE OF FUNDS.—Grant funds under this section shall be used by an institution of higher education to support or es- tablish a campus-based child care program primarily serving the needs of low-income students enrolled at the institution of higher education.

Grant funds under this section may be used to provide before and after school services to the extent nec- essary to enable low-income students enrolled at the institu- tion of higher education to pursue postsecondary education.
(6) CONSTRUCTION.—Nothing in this section shall be con- strued to prohibit an institution of higher education that re- ceives grant funds under this section from serving the child care needs of the community served by the institution.
(7) DEFINITION OF LOW-INCOME STUDENT.—For the purpose of this section, the term ‘‘low-income student’’ means a stu- dent— (A) who is eligible to receive a Federal Pell Grant for the award year for which the determination is made; or (B) who would otherwise be eligible to receive a Fed- eral Pell Grant for the award year for which the deter- mination is made, except that the student fails to meet the requirements of— (i) section 401(c)(1) because the student is enrolled in a graduate or first professional course of study; or (ii) section 484(a)(5) because the student is in the United States for a temporary purpose.
(8) PUBLICITY.—The Secretary shall publicize the avail- ability of grants under this section in appropriate periodicals, September 8, 2023 As Amended Through P.L.

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419N in addition to publication in the Federal Register, and shall in- form appropriate educational organizations of such availability.

(c) APPLICATIONS.—An institution of higher education desiring a grant under this section shall submit an application to the Sec- retary at such time, in such manner, and accompanied by such in- formation as the Secretary may require.
Each application shall— (1) demonstrate that the institution is an eligible institu- tion described in subsection (b)(4); (2) specify the amount of funds requested; (3) demonstrate the need of low-income students at the in- stitution for campus-based child care services by including in the application— (A) information regarding student demographics; (B) an assessment of child care capacity on or near campus; (C) information regarding the existence of waiting lists for existing child care; (D) information regarding additional needs created by concentrations of poverty or by geographic isolation; and (E) other relevant data; (4) contain a description of the activities to be assisted, in- cluding whether the grant funds will support an existing child care program or a new child care program; (5) identify the resources, including technical expertise and financial support, the institution will draw upon to support the child care program and the participation of low-income stu- dents in the program, such as accessing social services funding, using student activity fees to help pay the costs of child care, using resources obtained by meeting the needs of parents who are not low-income students, and accessing foundation, cor- porate or other institutional support, and demonstrate that the use of the resources will not result in increases in student tui- tion; (6) contain an assurance that the institution will meet the child care needs of low-income students through the provision of services, or through a contract for the provision of services; (7) describe the extent to which the child care program will coordinate with the institution’s early childhood education cur- riculum, to the extent the curriculum is available, to meet the needs of the students in the early childhood education program at the institution, and the needs of the parents and children participating in the child care program assisted under this sec- tion; (8) in the case of an institution seeking assistance for a new child care program— (A) provide a timeline, covering the period from receipt of the grant through the provision of the child care serv- ices, delineating the specific steps the institution will take to achieve the goal of providing low-income students with child care services; (B) specify any measures the institution will take to assist low-income students with child care during the pe- riod before the institution provides child care services; and September 8, 2023 As Amended Through P.L.
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419N HIGHER EDUCATION ACT OF 1965 264 (C) include a plan for identifying resources needed for the child care services, including space in which to provide child care services, and technical assistance if necessary; (9) contain an assurance that any child care facility as- sisted under this section will meet the applicable State or local government licensing, certification, approval, or registration re- quirements; and (10) contain a plan for any child care facility assisted under this section to become accredited within 3 years of the date the institution first receives assistance under this section.
(d) PRIORITY.—The Secretary shall give priority in awarding grants under this section to institutions of higher education that submit applications describing programs that— (1) leverage significant local or institutional resources, in- cluding in-kind contributions, to support the activities assisted under this section; and (2) utilize a sliding fee scale for child care services pro- vided under this section in order to support a high number of low-income parents pursuing postsecondary education at the institution.
(e) REPORTING REQUIREMENTS; CONTINUING ELIGIBILITY.— (1) REPORTING REQUIREMENTS.— (A) REPORTS.—Each institution of higher education re- ceiving a grant under this section shall report to the Sec- retary annually.
(B) CONTENTS.—The report shall include— (i) data on the population served under this section; (ii) information on campus and community re- sources and funding used to help low-income students access child care services; (iii) information on progress made toward accredi- tation of any child care facility; and (iv) information on the impact of the grant on the quality, availability, and affordability of campus-based child care services.
(2) CONTINUING ELIGIBILITY.—The Secretary shall make continuation awards under this section to an institution of higher education only if the Secretary determines, on the basis of the reports submitted under paragraph (1), that the institu- tion is making a good faith effort to ensure that low-income students at the institution have access to affordable, quality child care services.
(f) CONSTRUCTION.—No funds provided under this section shall be used for construction, except for minor renovation or repair to meet applicable State or local health or safety requirements.

(g) AUTHORIZATION OF APPROPRIATIONS.—There are authorized to be appropriated to carry out this section such sums as may be necessary for fiscal year 2009 and each of the five succeeding fiscal years.
øSubpart 8 of part A of title IV was repealed by section 411 of Public Law 110–315.¿ September 8, 2023 As Amended Through P.L.

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420M Subpart 9—TEACH Grants SEC.

420L.

ø20 U.S.C.

1070g¿ DEFINITIONS.
For the purposes of this subpart: (1) ELIGIBLE INSTITUTION.—The term ‘‘eligible institution’’ means an institution of higher education, as defined in section 102, that the Secretary determines— (A) provides high quality teacher preparation and pro- fessional development services, including extensive clinical experience as a part of pre-service preparation; (B) is financially responsible; (C) provides pedagogical course work, or assistance in the provision of such coursework, including the monitoring of student performance, and formal instruction related to the theory and practices of teaching; and (D) provides supervision and support services to teach- ers, or assistance in the provision of such services, includ- ing mentoring focused on developing effective teaching skills and strategies.
(2) POST-BACCALAUREATE.—The term ‘‘post-baccalaureate’’ means a program of instruction for individuals who have com- pleted a baccalaureate degree, that does not lead to a graduate degree, and that consists of courses required by a State in order for a teacher candidate to receive a professional certifi- cation or licensing credential that is required for employment as a teacher in an elementary school or secondary school in that State, except that such term shall not include any pro- gram of instruction offered by an eligible institution that offers a baccalaureate degree in education.
(3) TEACHER CANDIDATE.—The term ‘‘teacher candidate’’ means a student or teacher described in subparagraph (A) or (B) of section 420N(a)(2).

SEC.

420M.

ø20 U.S.C.

1070g–1¿ PROGRAM ESTABLISHED.


(a) PROGRAM AUTHORITY.— (1) PAYMENTS REQUIRED.—The Secretary shall pay to each eligible institution such sums as may be necessary to pay to each teacher candidate who files an application and agreement in accordance with section 420N, and who qualifies under paragraph (2) of section 420N(a), a TEACH Grant in the amount of $4,000 for each year during which that teacher can- didate is in attendance at the institution.
(2) REFERENCES.—Grants made under paragraph (1) shall be known as ‘‘Teacher Education Assistance for College and Higher Education Grants’’ or ‘‘TEACH Grants’’.
(b) PAYMENT METHODOLOGY.— (1) PREPAYMENT.—Not less than 85 percent of any funds provided to an eligible institution under subsection (a) shall be advanced to the eligible institution prior to the start of each payment period and shall be based upon an amount requested by the institution as needed to pay teacher candidates until such time as the Secretary determines and publishes in the Federal Register with an opportunity for comment, an alter- native payment system that provides payments to institutions September 8, 2023 As Amended Through P.L.
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420M HIGHER EDUCATION ACT OF 1965 266 in an accurate and timely manner, except that this sentence shall not be construed to limit the authority of the Secretary to place an institution on a reimbursement system of payment.
(2) DIRECT PAYMENT.—Nothing in this section shall be in- terpreted to prohibit the Secretary from paying directly to teacher candidates, in advance of the beginning of the aca- demic term, an amount for which teacher candidates are eligi- ble, in cases where the eligible institution elects not to partici- pate in the disbursement system required by paragraph (1).
(3) DISTRIBUTION OF GRANTS TO TEACHER CANDIDATES.— Payments under this subpart shall be made, in accordance with regulations promulgated by the Secretary for such pur- pose, in such manner as will best accomplish the purposes of this subpart.

Any disbursement allowed to be made by cred- iting the teacher candidate’s account shall be limited to tuition and fees and, in the case of institutionally-owned housing, room and board.
The teacher candidate may elect to have the institution provide other such goods and services by crediting the teacher candidate’s account.
(c) REDUCTIONS IN AMOUNT.— (1) PART-TIME STUDENTS.—In any case where a teacher candidate attends an eligible institution on less than a full- time basis (including a teacher candidate who attends an eligi- ble institution on less than a half-time basis) during any year, the amount of a grant under this subpart for which that teach- er candidate is eligible shall be reduced in proportion to the de- gree to which that teacher candidate is not attending on a full- time basis, in accordance with a schedule of reductions estab- lished by the Secretary for the purposes of this subpart, com- puted in accordance with this subpart.
Such schedule of reduc- tions shall be established by regulation and published in the Federal Register in accordance with section 482 of this Act.

(2) NO EXCEEDING COST.—The amount of a grant awarded under this subpart, in combination with Federal assistance and other assistance the student may receive, shall not exceed the cost of attendance (as defined in section 472) at the eligible in- stitution at which that teacher candidate is in attendance.
(d) PERIOD OF ELIGIBILITY FOR GRANTS.— (1) UNDERGRADUATE AND POST-BACCALAUREATE STU- DENTS.—The period during which an undergraduate or post- baccalaureate student may receive grants under this subpart shall be the period required for the completion of the first un- dergraduate baccalaureate or post-baccalaureate course of study being pursued by the teacher candidate at the eligible in- stitution at which the teacher candidate is in attendance, ex- cept that— (A) any period during which the teacher candidate is enrolled in a noncredit or remedial course of study as de- scribed in paragraph (3) shall not be counted for the pur- pose of this paragraph; and (B) the total amount that a teacher candidate may re- ceive under this subpart for undergraduate or post-bacca- laureate study shall not exceed $16,000.
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420N (2) GRADUATE STUDENTS.—The period during which a graduate student may receive grants under this subpart shall be the period required for the completion of a master’s degree course of study pursued by the teacher candidate at the eligible institution at which the teacher candidate is in attendance, ex- cept that the total amount that a teacher candidate may re- ceive under this subpart for graduate study shall not exceed $8,000.
(3) REMEDIAL COURSE; STUDY ABROAD.—Nothing in this section shall be construed to exclude from eligibility courses of study which are noncredit or remedial in nature (including courses in English language acquisition) which are determined by the eligible institution to be necessary to help the teacher candidate be prepared for the pursuit of a first undergraduate baccalaureate or post-baccalaureate degree or certificate or, in the case of courses in English language instruction, to be nec- essary to enable the teacher candidate to utilize already exist- ing knowledge, training, or skills.
Nothing in this section shall be construed to exclude from eligibility programs of study abroad that are approved for credit by the home institution at which the teacher candidate is enrolled.

SEC.

420N.

ø20 U.S.C.

1070g–2¿ APPLICATIONS; ELIGIBILITY.

(a) APPLICATIONS; DEMONSTRATION OF ELIGIBILITY.— (1) FILING REQUIRED.—The Secretary shall periodically set dates by which teacher candidates shall file applications for grants under this subpart.
Each teacher candidate desiring a grant under this subpart for any year shall file an application containing such information and assurances as the Secretary may determine necessary to enable the Secretary to carry out the functions and responsibilities of this subpart.
(2) DEMONSTRATION OF TEACH GRANT ELIGIBILITY.—Each application submitted under paragraph (1) shall contain such information as is necessary to demonstrate that— (A) if the applicant is an enrolled student— (i) the student is an eligible student for purposes of section 484; (ii) the student— (I) has a grade point average that is deter- mined, under standards prescribed by the Sec- retary, to be comparable to a 3.25 average on a zero to 4.0 scale, except that, if the student is in the first year of a program of undergraduate edu- cation, such grade point average shall be deter- mined on the basis of the student’s cumulative secondary school grade point average; or (II) displayed high academic aptitude by re- ceiving a score above the 75th percentile on at least one of the batteries in an undergraduate, post-baccalaureate, or graduate school admissions test; and (iii) the student is completing coursework and other requirements necessary to begin a career in September 8, 2023 As Amended Through P.L.
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420N HIGHER EDUCATION ACT OF 1965 268 teaching, or plans to complete such coursework and re- quirements prior to graduating; or (B) if the applicant is a current or prospective teacher applying for a grant to obtain a graduate degree— (i) the applicant is a teacher or a retiree from an- other occupation with expertise in a field in which there is a shortage of teachers, such as mathematics, science, special education, English language acquisi- tion, or another high-need subject; or (ii) the applicant is or was a teacher who is using high-quality alternative certification routes, such as Teach for America, to get certified.
(b) AGREEMENTS TO SERVE.—Each application under subsection (a) shall contain or be accompanied by an agreement by the appli- cant that— (1) the applicant will— (A) serve as a full-time teacher for a total of not less than 4 academic years within 8 years after completing the course of study for which the applicant received a TEACH Grant under this subpart (referred to in this section as the ‘‘service obligation window’’); (B) teach in a school described in section 465(a)(2)(A); (C) teach in any of the following fields— (i) mathematics; (ii) science; (iii) a foreign language; (iv) bilingual education; (v) special education; (vi) as a reading specialist; or (vii) another field or geographic area documented as high-need by the Federal Government, State gov- ernment, or local educational agency, and approved by the Secretary; (D) submit a certification of employment by the chief administrative officer of the school in accordance with sub- section (d)(5); and (E) meet all State certification requirements for teach- ing include meeting such requirements (which may through a certification obtained through alternative routes to teaching); (2) in the event that the applicant is determined to have failed or refused to carry out such service obligation, the sum of the amounts of any TEACH Grants received by such appli- cant will be treated as a loan and collected from the applicant in accordance with subsection (c) and the regulations there- under; and (3) contains, or is accompanied by, a plain-language disclo- sure form developed by the Secretary that clearly describes the nature of the TEACH Grant award, the service obligation, and the loan repayment requirements that are the consequence of the failure to complete the service obligation.
(c) REPAYMENT FOR FAILURE TO COMPLETE SERVICE.— (1) IN GENERAL.—In the event that any recipient of a grant under this subpart fails or refuses to comply with the service September 8, 2023 As Amended Through P.L.

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420N obligation in the agreement under subsection (b), the sum of the amounts of any TEACH Grants received by such recipient shall, upon a determination of such a failure or refusal in such service obligation, be treated as a Federal Direct Unsubsidized Stafford Loan under part D of title IV, and shall be subject to repayment, together with interest thereon accruing from the date of the grant award, in accordance with terms and condi- tions specified by the Secretary in regulations under this sub- part.
(2) RECONSIDERATION OF CONVERSION DECISIONS.— (A) REQUEST TO RECONSIDER.—In any case where the Secretary has determined that a recipient of a grant under this subpart has failed or refused to comply with the serv- ice obligation in the agreement under subsection (b) and has converted the grant into a Federal Direct Unsub- sidized Stafford Loan under part D in accordance with paragraph (1), (including a TEACH Grant converted to a loan prior to the date of enactment of the Consider Teach- ers Act of 2021 and including cases where such loans have been fully or partially paid), the recipient may request that the Secretary reconsider such initial determination and may submit additional information to demonstrate satis- faction of the service obligation.
Upon receipt of such a re- quest, the Secretary shall reconsider the determination in accordance with this paragraph not later than 90 days after the date that such request was received.
(B) RECONSIDERATION.—If, in reconsidering an initial determination under subparagraph (A) (including reconsid- eration related to a TEACH Grant that was converted to a loan prior to the date of enactment of the Consider Teachers Act of 2021 and including cases where such loans were fully or partially paid), the Secretary determines that the reason for such determination was the recipient’s fail- ure to timely submit a certification required under sub- section (b)(1)(D) (as in effect on the day before the date of enactment of the Consider Teachers Act of 2021), an error or processing delay by the Secretary, a change to the fields considered eligible for fulfillment of the service obligation (as described in subsection (b)(1)(C)), a recipient having previously requested to have the TEACH Grant converted to a loan, or another valid reason determined by the Sec- retary, and that the recipient has, as of the date of the re- consideration, demonstrated that the recipient did meet, or is meeting the service obligation in the agreement under subsection (b), the Secretary shall— (i) discharge the Federal Direct Unsubsidized Stafford Loan under part D, and reinstate the recipi- ent’s grant under this subpart; (ii) discharge any interest or fees that may have accumulated during the period that the grant was con- verted to a Federal Direct Unsubsidized Stafford Loan under part D; (iii) if the recipient has other loans under part D, apply any payments made for the Federal Direct Un- September 8, 2023 As Amended Through P.L.
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420N HIGHER EDUCATION ACT OF 1965 270 subsidized Stafford Loan under part D during such pe- riod to those other loans under part D; (iv) if the recipient does not have other loans under part D, reimburse the recipient for any amounts paid on the Federal Direct Unsubsidized Stafford Loan under part D during such period; (v) request that consumer reporting agencies re- move any negative credit reporting due to the conver- sion of the TEACH Grant to a loan; and (vi) use the additional information provided under subparagraph (A) to determine the progress the recipi- ent has made in meeting the service obligation.
(C) EXTENSION OF TIME TO COMPLETE SERVICE OBLIGA- TION.—In the case of a recipient whose TEACH Grant was reinstated in accordance with subparagraph (B), the Sec- retary shall, upon such reinstatement— (i) extend the time remaining for the recipient to fulfill the service obligation described in subsection (b)(1) to a period of time equal to— (I) 8 years; minus (II) the number of full academic years of teaching that the recipient completed prior to the reconversion of the loan to a TEACH Grant under subparagraph (B), including any years of quali- fying teaching completed during the period when the TEACH Grant was in loan status; and (ii) treat any full academic years of teaching de- scribed in clause (i)(II) as years that count toward the individual’s service obligation (regardless of whether the TEACH Grant funds were in grant or loan status) if that time otherwise meets the requirements of this section.
(d) ADDITIONAL ADMINISTRATIVE PROVISIONS.— (1) CHANGE OF HIGH-NEED DESIGNATION.—If a recipient of an initial grant under this subpart has acquired an academic degree, or expertise, in a field that was, at the time of the re- cipient’s application for that grant, designated as high need in accordance with subsection (b)(1)(C)(vii), but is no longer so designated, the grant recipient may fulfill the service obliga- tion described in subsection (b)(1) by teaching in that field.
(2) EXTENUATING CIRCUMSTANCES.—The Secretary shall es- tablish, by regulation, categories of extenuating circumstances under which a recipient of a grant under this subpart who is unable to fulfill all or part of the recipient’s service obligation may be excused from fulfilling that portion of the service obli- gation.
(3) COMMUNICATION WITH RECIPIENTS.—The Secretary shall notify TEACH grant recipients not less than once per cal- endar year regarding how to submit the employment certifi- cation under subsection (b)(1)(D) and the recommendations and requirements for submitting that certification under subsection (d)(5).

(4) QUALIFYING SCHOOLS AND HIGH-NEED FIELDS.—The Sec- retary shall maintain and annually update a list of qualifying September 8, 2023 As Amended Through P.L.
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420P schools as described in subsection (b)(1)(B), and a list of high- need fields as described in subsection (b)(1)(C) and shall make such lists publicly available on the Department’s website in a sortable and searchable format.
(5) SUBMISSION OF EMPLOYMENT CERTIFICATION.— (A) RECOMMENDED SUBMISSIONS.—The Secretary shall notify TEACH Grant recipients that the Department rec- ommends that TEACH Grant recipients submit the em- ployment certification described in subsection (b)(1)(D) as soon as practicable after the completion of each year of service.
(B) REQUIRED SUBMISSION.—A TEACH Grant recipient shall be required to submit to the Department employment certification within the timeframe that would allow that individual to complete their service obligation before the end of the service obligation window.

(C) NOTIFICATION.—The Secretary shall notify TEACH Grant recipients of the required submission deadlines de- scribed in this paragraph.
(D) ADJUSTMENT OF DEADLINE.—The Secretary shall adjust the submission deadline described in subparagraph (B) to account for a service obligation window extension.
(E) ALTERNATIVE TO CERTIFICATION.—The Secretary shall provide an alternative to the certification of employ- ment described in subsection (b)(1)(D) for recipients who cannot obtain such required certification of employment from the chief administrative officer of the school because the recipient can demonstrate the school is no longer in ex- istence or the school refuses to cooperate.

SEC.

420O.

ø20 U.S.C.

1070g–3¿ PROGRAM PERIOD AND FUNDING.


Beginning on July 1, 2008, there shall be available to the Sec- retary to carry out this subpart, from funds not otherwise appro- priated, such sums as may be necessary to provide TEACH Grants in accordance with this subpart to each eligible applicant.

SEC.

420P.

ø20 U.S.C.

1070g–4¿ PROGRAM REPORT.


Not later than two years after the date of enactment of the Higher Education Opportunity Act and every two years thereafter, the Secretary shall prepare and submit to the authorizing commit- tees a report on TEACH grants with respect to the schools and stu- dents served by recipients of such grants.
Such report shall take into consideration information related to— (1) the number of TEACH grant recipients; (2) the degrees obtained by such recipients; (3) the location, including the school, local educational agency, and State, where the recipients completed the service agreed to under section 420N(b) and the subject taught; (4) the duration of such service; and (5) any other data necessary to conduct such evaluation.

September 8, 2023 As Amended Through P.L.


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420R HIGHER EDUCATION ACT OF 1965 272 Subpart 10—Scholarships for Veteran’s Dependents SEC.

420R.

14 ø20 U.S.C.

1070h¿ SCHOLARSHIPS FOR VETERAN’S DE- PENDENTS.
(a) DEFINITION OF ELIGIBLE VETERAN’S DEPENDENT.—The term ‘‘eligible veteran’s dependent’’ means a dependent or an inde- pendent student— (1) whose parent or guardian was a member of the Armed Forces of the United States and died as a result of performing military service in Iraq or Afghanistan after September 11, 2001; and (2) who, at the time of the parent or guardian’s death, was— (A) less than 24 years of age; or (B) enrolled at an institution of higher education on a part-time or full-time basis.
(b) GRANTS.— (1) IN GENERAL.—The Secretary shall award a grant to each eligible veteran’s dependent to assist in paying the eligi- ble veteran’s dependent’s cost of attendance at an institution of higher education.

(2) DESIGNATION.—Grants made under this section shall be known as ‘‘Iraq and Afghanistan Service Grants’’.

(c) PREVENTION OF DOUBLE BENEFITS.—No eligible veteran’s dependent may receive a grant under both this section and section 401.
(d) TERMS AND CONDITIONS.—The Secretary shall award grants under this section in the same manner, and with the same terms and conditions, including the length of the period of eligibility, as the Secretary awards Federal Pell Grants under section 401, except that— (1) the award rules and determination of need applicable to the calculation of Federal Pell Grants, shall not apply to grants made under this section; (2) the provisions of subsection (a)(3), subsection (b)(1), the matter following subsection (b)(2)(A)(v), subsection (b)(3), and subsection (f), of section 401 shall not apply; and (3) a grant made under this section to an eligible veteran’s dependent for any award year shall equal the maximum Fed- eral Pell Grant available for that award year, except that such a grant under this section— (A) shall not exceed the cost of attendance of the eligi- ble veteran’s dependent for that award year; and (B) shall be adjusted to reflect the attendance by the eligible veteran’s dependent on a less than full-time basis in the same manner as such adjustments are made under section 401.
14 Section 103(c)(2) of division R of Public Law 117–103 provides for an amendment to strike section 420R.
Subsection (d) of such section 103 provides: ‘‘[t]he amendments made by sub- sections (a), (b), and (c) shall take effect as if included in the FAFSA Simplification Act (title VII of division FF of Public Law 116–260) and subject to the effective date of section 701(b) of such Act, as amended by this division (including the authorization provided under section 102(c)(1)(A)).’’ Such effective date is on or after July 1, 2023, but not later than July 1, 2024.

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421 (e) ESTIMATED FINANCIAL ASSISTANCE.—For purposes of deter- minations of need under part F, a grant awarded under this section shall not be treated as estimated financial assistance as described in sections 471(3) and 480(j).
(f) AUTHORIZATION AND APPROPRIATIONS OF FUNDS.—There are authorized to be appropriated, and there are appropriated, out of any money in the Treasury not otherwise appropriated, for the Sec- retary to carry out this section, such sums as may be necessary for fiscal year 2010 and each succeeding fiscal year.

PART B—FEDERAL FAMILY EDUCATION LOAN PROGRAM SEC.

421. ø20 U.S.C.

1071¿ STATEMENT OF PURPOSE; NONDISCRIMINA- TION; AND APPROPRIATIONS AUTHORIZED.
(a) PURPOSE; DISCRIMINATION PROHIBITED.— (1) PURPOSE.—The purpose of this part is to enable the Secretary— (A) to encourage States and nonprofit private institu- tions and organizations to establish adequate loan insur- ance programs for students in eligible institutions (as de- fined in section 435), (B) to provide a Federal program of student loan in- surance for students or lenders who do not have reason- able access to a State or private nonprofit program of stu- dent loan insurance covered by an agreement under sec- tion 428(b), (C) to pay a portion of the interest on loans to quali- fied students which are insured under this part, and (D) to guarantee a portion of each loan insured under a program of a State or of a nonprofit private insti- tution or organization which meets the requirements of section 428(a)(1)(B).
(2) DISCRIMINATION BY CREDITORS PROHIBITED.—No agen- cy, organization, institution, bank, credit union, corporation, or other lender who regularly extends, renews, or continues credit or provides insurance under this part shall exclude from re- ceipt or deny the benefits of, or discriminate against any bor- rower or applicant in obtaining, such credit or insurance on the basis of race, national origin, religion, sex, marital status, age, or handicapped status.
(b) AUTHORIZATION OF APPROPRIATIONS.—For the purpose of carrying out this part— (1) there are authorized to be appropriated to the student loan insurance fund (established by section 431) (A) the sum of $1,000,000, and (B) such further sums, if any, as may be- come necessary for the adequacy of the student loan insurance fund, (2) there are authorized to be appropriated, for payments under section 428 with respect to interest on student loans and for payments under section 437, such sums for the fiscal year ending June 30, 1966, and succeeding fiscal years, as may be required therefor, (3) there is authorized to be appropriated the sum of $17,500,000 for making advances pursuant to section 422 for September 8, 2023 As Amended Through P.L.
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422 HIGHER EDUCATION ACT OF 1965 274 the reserve funds of State and nonprofit private student loan insurance programs, (4) there are authorized to be appropriated (A) the sum of $12,500,000 for making advances after June 30, 1968, pursu- ant to sections 422 (a) and (b), and (B) such sums as may be necessary for making advances pursuant to section 422(c), for the reserve funds of State and nonprofit private student loan insurance programs, (5) there are authorized to be appropriated such sums as may be necessary for the purpose of paying a loan processing and issuance fee in accordance with section 428(f) to guaranty agencies, and (6) there is authorized to be appropriated, and there are appropriated, out of any money in the Treasury not otherwise appropriated, such sums as may be necessary for the purpose of carrying out section 422(c)(7).
Sums appropriated under paragraphs (1), (2), (4), and (5) of this subsection shall remain available until expended, except that no sums may be expended after June 30, 2010, with respect to loans under this part for which the first disbursement is after such date.

No additional sums are authorized to be appropriated under para- graph (3) or (4) of this subsection by reason of the reenactment of such paragraphs by the Higher Education Amendments of 1986.
(c) DESIGNATION.—The program established under this part shall be referred to as the ‘‘Robert T. Stafford Federal Student Loan Program’’.

Loans made pursuant to sections 427 and 428 shall be known as ‘‘Federal Stafford Loans’’.
(d) TERMINATION OF AUTHORITY TO MAKE OR INSURE NEW LOANS.—Notwithstanding paragraphs (1) through (6) of subsection (b) or any other provision of law— (1) no new loans (including consolidation loans) may be made or insured under this part after June 30, 2010; and (2) no funds are authorized to be appropriated, or may be expended, under this Act or any other Act to make or insure loans under this part (including consolidation loans) for which the first disbursement is after June 30, 2010, except as expressly authorized by an Act of Congress enacted after the date of enactment of the SAFRA Act.
SEC.

422. ø20 U.S.C.

1072¿ ADVANCES FOR RESERVE FUNDS OF STATE AND NONPROFIT PRIVATE LOAN INSURANCE PROGRAMS.
(a) PURPOSE OF AND AUTHORITY FOR ADVANCES TO RESERVE FUNDS.— (1) PURPOSE; ELIGIBLE RECIPIENTS.—From sums appro- priated pursuant to paragraphs (3) and (4)(A) of section 421(b), the Secretary is authorized to make advances to any State with which the Secretary has made an agreement pursuant to section 428(b) for the purpose of helping to establish or strengthen the reserve fund of the student loan insurance pro- gram covered by that agreement.
If for any fiscal year a State does not have a student loan insurance program covered by an agreement made pursuant to section 428(b), and the Secretary determines after consultation with the chief executive officer of that State that there is no reasonable likelihood that the State will have such a student loan insurance program for such year, September 8, 2023 As Amended Through P.L.
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422 the Secretary may make advances for such year for the same purpose to one or more nonprofit private institutions or organi- zations with which the Secretary has made an agreement pur- suant to section 428(b) in order to enable students in the State to participate in a program of student loan insurance covered by such an agreement.
The Secretary may make advances under this subsection both to a State program (with which he has such an agreement) and to one or more nonprofit private institutions or organizations (with which he has such an agree- ment) in that State if he determines that such advances are necessary in order that students in each eligible institution have access through such institution to a student loan insur- ance program which meets the requirements of section 428(b)(1).
(2) MATCHING REQUIREMENT.—No advance shall be made after June 30, 1968, unless matched by an equal amount from non-Federal sources.

Such equal amount may include the unencumbered non-Federal portion of a reserve fund.
As used in the preceding sentence, the term ‘‘unencumbered non-Fed- eral portion’’ means the amount (determined as of the time im- mediately preceding the making of the advance) of the reserve fund less the greater of— (A) the sum of— (i) advances made under this section prior to July 1, 1968; (ii) an amount equal to twice the amount of ad- vances made under this section after June 30, 1968, and before the advance for purposes of which the de- termination is made; and (iii) the proceeds of earnings on advances made under this section; or (B) any amount which is required to be maintained in such fund pursuant to State law or regulation, or by agree- ment with lenders, as a reserve against the insurance of outstanding loans.
Except as provided in section 428(c)(9)(E) or (F), such unencumbered non-Federal portion shall not be subject to re- call, repayment, or recovery by the Secretary.

(3) TERMS AND CONDITIONS; REPAYMENT.—Advances pursu- ant to this subsection shall be upon such terms and conditions (including conditions relating to the time or times of payment) consistent with the requirements of section 428(b) as the Sec- retary determines will best carry out the purpose of this sec- tion.
Advances made by the Secretary under this subsection shall be repaid within such period as the Secretary may deem to be appropriate in each case in the light of the maturity and solvency of the reserve fund for which the advance was made.
(b) LIMITATIONS ON TOTAL ADVANCES.— (1) IN GENERAL.—The total of the advances from the sums appropriated pursuant to paragraph (4)(A) of section 421(b) to nonprofit private institutions and organizations for the benefit of students in any State and to such State may not exceed an amount which bears the same ratio to such sums as the popu- lation of such State aged 18 to 22, inclusive, bears to the popu- September 8, 2023 As Amended Through P.L.
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422 HIGHER EDUCATION ACT OF 1965 276 lation of all the States aged 18 to 22 inclusive, but such ad- vances may otherwise be in such amounts as the Secretary de- termines will best achieve the purposes for which they are made.
The amount available for advances to any State shall not be less than $25,000 and any additional funds needed to meet this requirement shall be derived by proportionately re- ducing (but not below $25,000) the amount available for ad- vances to each of the remaining States.
(2) CALCULATION OF POPULATION.—For the purpose of this subsection, the population aged 18 to 22, inclusive, of each State and of all the States shall be determined by the Sec- retary on the basis of the most recent satisfactory data avail- able to him.
(c) ADVANCES FOR INSURANCE OBLIGATIONS.— (1) USE FOR PAYMENT OF INSURANCE OBLIGATIONS.—From sums appropriated pursuant to section 421(b)(4)(B), the Sec- retary shall advance to each State which has an agreement with the Secretary under section 428(c) with respect to a stu- dent loan insurance program, an amount determined in accord- ance with paragraph (2) of this subsection to be used for the purpose of making payments under the State’s insurance obli- gations under such program.
(2) AMOUNT OF ADVANCES.—(A) Except as provided in sub- paragraph (B), the amount to be advanced to each such State shall be equal to 10 percent of the principal amount of loans made by lenders and insured by such agency on those loans on which the first payment of principal became due during the fis- cal year immediately preceding the fiscal year in which the ad- vance is made.
(B) The amount of any advance determined according to subparagraph (A) of this paragraph shall be reduced by— (i) the amount of any advance or advances made to such State pursuant to this subsection at an earlier date; and (ii) the amount of the unspent balance of the advances made to a State pursuant to subsection (a).
Notwithstanding subparagraph (A) and the preceding sentence of this subparagraph, but subject to subparagraph (D) of this paragraph, the amount of any advance to a State described in paragraph (5)(A) for the first year of its eligibility under such paragraph, and the amount of any advance to any State de- scribed in paragraph (5)(B) for each year of its eligibility under such paragraph, shall not be less than $50,000.
(C) For the purpose of subparagraph (B), the unspent bal- ance of the advances made to a State pursuant to subsection (a) shall be that portion of the balance of the State’s reserve fund (remaining at the time of the State’s first request for an advance pursuant to this subsection) which bears the same ratio to such balance as the Federal advances made and not re- turned by such State, pursuant to subsection (a), bears to the total of all past contributions to such reserve funds from all sources (other than interest on investment of any portion of the reserve fund) contributed since the date such State executed an agreement pursuant to section 428(b).
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422 (D) If the sums appropriated for any fiscal year for paying the amounts determined under subparagraphs (A) and (B) are not sufficient to pay such amounts in full, then such amounts shall be reduced— (i) by ratably reducing that portion of the amount allo- cated to each State which exceeds $50,000; and (ii) if further reduction is required, by equally reduc- ing the $50,000 minimum allocation of each State.
If additional sums become available for paying such amounts for any fiscal year during which the preceding sentence has been applied, such reduced amounts shall be increased on the same basis as they were reduced.

(3) USE OF EARNINGS FOR INSURANCE OBLIGATIONS.—The earnings, if any, on any investments of advances received pur- suant to this subsection must be used for making payments under the State’s insurance obligations.
(4) REPAYMENT OF ADVANCES.—Advances made by the Sec- retary under this subsection shall, subject to subsection (d), be repaid within such period as the Secretary may deem to be ap- propriate and shall be deposited in the fund established by sec- tion 431.
(5) LIMITATION ON NUMBER OF ADVANCES.—Except as pro- vided in paragraph (7), advances pursuant to this subsection shall be made to a State— (A) in the case of a State which is actively carrying on a program under an agreement pursuant to section 428(b) which was entered into before October 12, 1976, upon such date as such State may request, but not before October 1, 1977, and on the same day of each of the 2 succeeding cal- endar years after the date so requested; and (B) in the case of a State which enters into an agree- ment pursuant to section 428(b) on or after October 12, 1976, or which is not actively carrying on a program under an agreement pursuant to such section on such date, upon such date as such State may request, but not before Octo- ber 1, 1977, and on the same day of each of the 4 suc- ceeding calendar years after the date so requested of the advance.
(6) PAYMENT OF ADVANCES WHERE NO STATE PROGRAM.— (A) If for any fiscal year a State does not have a student loan insurance program covered by an agreement made pursuant to section 428(b), and the Secretary determines after consultation with the chief executive officer of that State that there is no reasonable likelihood that the State will have such a student loan insurance program for such year, the Secretary may make advances pursuant to this subsection for such year for the same purpose to one or more nonprofit private institutions or organizations with which he has made an agreement pursuant to subsection (c), as well as subsection (b), of section 428 and subparagraph (B) of this paragraph in order to enable students in that State to participate in a program of student loan insur- ance covered by such agreements.
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422 HIGHER EDUCATION ACT OF 1965 278 (B) The Secretary may enter into an agreement with a pri- vate nonprofit institution or organization for the purpose of this paragraph under which such institution or organization— (i) agrees to establish within such State at least one office with sufficient staff to handle written, electronic, and telephone inquiries from students, eligible lenders, and other persons in the State, to encourage maximum com- mercial lender participation within the State, and to con- duct periodic visits to at least the major eligible lenders within the State; (ii) agrees that its insurance will not be denied any student because of his or her choice of eligible institutions; and (iii) certifies that it is neither an eligible institution, nor has any substantial affiliation with an eligible institu- tion.
(7) EMERGENCY ADVANCES.—The Secretary is authorized to make advances, on terms and conditions satisfactory to the Secretary, to a guaranty agency— (A) in accordance with section 428(j), in order to en- sure that the guaranty agency shall make loans as the lender-of-last-resort; or (B) if the Secretary is seeking to terminate the guar- anty agency’s agreement, or assuming the guaranty agen- cy’s functions, in accordance with section 428(c)(9)(F)(v), in order to assist the agency in meeting its immediate cash needs, ensure the uninterrupted payment of claims, or en- sure that the guaranty agency shall make loans as de- scribed in subparagraph (A).
(d) RECOVERY OF ADVANCES DURING FISCAL YEARS 1988 AND 1989.— (1) AMOUNT AND USE OF RECOVERED FUNDS.—Notwith- standing any other provision of this section, advances made by the Secretary under this section shall be repaid in accordance with this subsection and shall be deposited in the fund estab- lished by section 431.
The Secretary shall, in accordance with the requirements of paragraph (2), recover (and so deposit) an amount equal to $75,000,000 during fiscal year 1988 and an amount equal to $35,000,000 for fiscal year 1989.
(2) DETERMINATION OF GUARANTY AGENCY OBLIGATIONS.— In determining the amount of advances which shall be repaid by a guaranty agency under paragraph (1), the Secretary— (A) shall consider the solvency and maturity of the re- serve and insurance funds of the guaranty agency assisted by such advances, as determined by the Comptroller Gen- eral taking into account the requirements of State law as in effect on the date of enactment of the Higher Education Amendments of 1986; (B) shall not seek repayment of such advances from any State described in subsection (c)(5)(B) during any year of its eligibility under such subsection; and (C) shall not seek repayment of such advances from any State if such repayment encumbers the reserve fund September 8, 2023 As Amended Through P.L.
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422 requirement of State law as in effect on such date of enact- ment.
(e) CORRECTION FOR ERRORS UNDER REDUCTION OF EXCESS CASH RESERVES.— (1) IN GENERAL.—The Secretary shall pay any guaranty agency the amount of reimbursement of claims under section 428(c)(1), filed between September 1, 1988, and December 31, 1989, which were previously withheld or canceled in order to be applied to satisfy such agency’s obligation to eliminate ex- cess cash reserves held by such agency, based on the maximum cash reserve (as described in subsection (e) of this section as in effect on September 1, 1988) permitted at the end of 1986, if such maximum cash reserve was miscalculated because of er- roneous financial information provided by such agency to the Secretary and if (A) such erroneous information is verified by an audited financial statement of the reserve fund, signed by a certified public accountant, and (B) such audited financial statement is provided to the Secretary prior to January 1, 1993.
(2) AMOUNT.—The amount of reimbursement for claims shall be equal to the amount of reimbursement for claims with- held or canceled in order to be applied to such agency’s obliga- tion to eliminate excess cash reserves which exceeds the amount of that which would have been withheld or canceled if the maximum excess cash reserves had been accurately cal- culated.
(f) REFUND OF CASH RESERVE PAYMENTS.—The Secretary shall, within 30 days after the date of enactment of the Higher Education Amendments of 1992, pay the full amount of payments withheld or canceled under paragraph (3) of this subsection to any guaranty agency which— (1) was required to eliminate excess cash reserves, based on the maximum cash reserve (as described in subsection (e) of this section as in effect on September 1, 1988) permitted at the end of 1986; (2) appealed the Secretary’s demand that such agency should eliminate such excess cash reserves and received a waiver of a portion of the amount of such excess cash reserves to be eliminated; (3) had payments under section 428(c)(1) or section 428(f) previously withheld or canceled in order to be applied to satisfy such agency’s obligation to eliminate excess cash reserves held by such agency, based on the maximum cash reserve (as de- scribed in subsection (e) of this section as in effect on Sep- tember 1, 1988) permitted at the end of 1986; and (4) according to a Department of Education review that was completed and forwarded to such guaranty agency prior to January 1, 1992, is expected to become insolvent during or be- fore 1996 and the payments withheld or canceled under para- graph (3) of this subsection are a factor in such agency’s im- pending insolvency.
(g) PRESERVATION AND RECOVERY OF GUARANTY AGENCY RE- SERVES.— September 8, 2023 As Amended Through P.L.

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422 HIGHER EDUCATION ACT OF 1965 280 (1) AUTHORITY TO RECOVER FUNDS.—Notwithstanding any other provision of law, the reserve funds of the guaranty agen- cies, and any assets purchased with such reserve funds, re- gardless of who holds or controls the reserves or assets, shall be considered to be the property of the United States to be used in the operation of the program authorized by this part.
However, the Secretary may not require the return of all re- serve funds of a guaranty agency to the Secretary unless the Secretary determines that such return is in the best interest of the operation of the program authorized by this part, or to ensure the proper maintenance of such agency’s funds or assets or the orderly termination of the guaranty agency’s operations and the liquidation of its assets.
The reserves shall be main- tained by each guaranty agency to pay program expenses and contingent liabilities, as authorized by the Secretary, except that— (A) the Secretary may direct a guaranty agency to re- turn to the Secretary a portion of its reserve fund which the Secretary determines is unnecessary to pay the pro- gram expenses and contingent liabilities of the guaranty agency; (B) the Secretary may direct the guaranty agency to require the return, to the guaranty agency or to the Sec- retary, of any reserve funds or assets held by, or under the control of, any other entity, which the Secretary deter- mines are necessary to pay the program expenses and con- tingent liabilities of the guaranty agency, or which are re- quired for the orderly termination of the guaranty agency’s operations and the liquidation of its assets; (C) the Secretary may direct a guaranty agency, or such agency’s officers or directors, to cease any activities involving expenditure, use or transfer of the guaranty agency’s reserve funds or assets which the Secretary deter- mines is a misapplication, misuse, or improper expenditure of such funds or assets; and (D) any such determination under subparagraph (A) or (B) shall be based on standards prescribed by regulations that are developed through negotiated rulemaking and that include procedures for administrative due process.
(2) TERMINATION PROVISIONS IN CONTRACTS.—(A) To en- sure that the funds and assets of the guaranty agency are pre- served, any contract with respect to the administration of a guaranty agency’s reserve funds, or the administration of any assets purchased or acquired with the reserve funds of the guaranty agency, that is entered into or extended by the guar- anty agency, or any other party on behalf of or with the con- currence of the guaranty agency, after the date of enactment of this subsection shall provide that the contract is terminable by the Secretary upon 30 days notice to the contracting parties if the Secretary determines that such contract includes an im- permissible transfer of the reserve funds or assets, or is other- wise inconsistent with the terms or purposes of this section.
(B) The Secretary may direct a guaranty agency to sus- pend or cease activities under any contract entered into by or September 8, 2023 As Amended Through P.L.

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422 on behalf of such agency after January 1, 1993, if the Secretary determines that the misuse or improper expenditure of such guaranty agency’s funds or assets or such contract provides un- necessary or improper benefits to such agency’s officers or di- rectors.

(3) PENALTIES.—Violation of any direction issued by the Secretary under this subsection may be subject to the penalties described in section 490 of this Act.
(4) AVAILABILITY OF FUNDS.—Any funds that are returned or otherwise recovered by the Secretary pursuant to this sub- section shall be available for expenditure for expenses pursu- ant to section 458 of this Act.

(h) RECALL OF RESERVES; LIMITATIONS ON USE OF RESERVE (1) IN GENERAL.—Notwithstanding any other provision of law, the Secretary shall, except as otherwise provided in this subsection, recall $1,000,000,000 from the reserve funds held by guaranty agencies on September 1, 2002.
(2) DEPOSIT.—Funds recalled by the Secretary under this subsection shall be deposited in the Treasury.

(3) REQUIRED SHARE.—The Secretary shall require each guaranty agency to return reserve funds under paragraph (1) based on the agency’s required share of recalled reserve funds held by guaranty agencies as of September 30, 1996.
For pur- poses of this paragraph, a guaranty agency’s required share of recalled reserve funds shall be determined as follows: FUNDS AND ASSETS.— (A) The Secretary shall compute each guaranty agen- cy’s reserve ratio by dividing (i) the amount held in the agency’s reserve funds as of September 30, 1996 (but re- flecting later accounting or auditing adjustments approved by the Secretary), by (ii) the original principal amount of all loans for which the agency has an outstanding insur- ance obligation as of such date, including amounts of out- standing loans transferred to the agency from another guaranty agency.
(B) If the reserve ratio of any guaranty agency as com- puted under subparagraph (A) exceeds 2.0 percent, the agency’s required share shall include so much of the amounts held in the agency’s reserve funds as exceed a re- serve ratio of 2.0 percent.
(C) If any additional amount is required to be recalled under paragraph (1) (after deducting the total of the re- quired shares calculated under subparagraph (B)), such additional amount shall be obtained by imposing on each guaranty agency an equal percentage reduction in the amount of the agency’s reserve funds remaining after de- duction of the amount recalled under subparagraph (B), except that such percentage reduction under this subpara- graph shall not result in the agency’s reserve ratio being reduced below 0.58 percent.
The equal percentage reduc- tion shall be the percentage obtained by dividing— (i) the additional amount required to be recalled (after deducting the total of the required shares cal- culated under subparagraph (B)), by September 8, 2023 As Amended Through P.L.

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422 HIGHER EDUCATION ACT OF 1965 282 (ii) the total amount of all such agencies’ reserve funds remaining (after deduction of the required shares calculated under such subparagraph).
(D) If any additional amount is required to be recalled under paragraph (1) (after deducting the total of the re- quired shares calculated under subparagraphs (B) and (C)), such additional amount shall be obtained by imposing on each guaranty agency with a reserve ratio (after de- ducting the required shares calculated under such sub- paragraphs) in excess of 0.58 percent an equal percentage reduction in the amount of the agency’s reserve funds re- maining (after such deduction) that exceed a reserve ratio of 0.58 percent.
The equal percentage reduction shall be the percentage obtained by dividing— (i) the additional amount to be recalled under paragraph (1) (after deducting the amount recalled under subparagraphs (B) and (C)), by (ii) the total amount of all such agencies’ reserve funds remaining (after deduction of the required shares calculated under such subparagraphs) that ex- ceed a reserve ratio of 0.58 percent.
(4) RESTRICTED ACCOUNTS REQUIRED.— (A) IN GENERAL.—Within 90 days after the beginning of each of the fiscal years 1998 through 2002, each guar- anty agency shall transfer a portion of the agency’s re- quired share determined under paragraph (3) to a re- stricted account established by the agency that is of a type selected by the agency with the approval of the Secretary.
Funds transferred to such restricted accounts shall be in- vested in obligations issued or guaranteed by the United States or in other similarly low-risk securities.

(B) REQUIREMENT.—A guaranty agency shall not use the funds in such a restricted account for any purpose without the express written permission of the Secretary, except that a guaranty agency may use the earnings from such restricted account for default reduction activities.
(C) INSTALLMENTS.—In each of fiscal years 1998 through 2002, each guaranty agency shall transfer the agency’s required share to such restricted account in 5 equal annual installments, except that— (i) a guaranty agency that has a reserve ratio (as computed under subparagraph (3)(A)) equal to or less than 1.10 percent may transfer the agency’s required share to such account in 4 equal installments begin- ning in fiscal year 1999; and (ii) a guaranty agency may transfer such required share to such account in accordance with such other payment schedules as are approved by the Secretary.
(5) SHORTAGE.—If, on September 1, 2002, the total amount in the restricted accounts described in paragraph (4) is less than the amount the Secretary is required to recall under paragraph (1), the Secretary shall require the return of the amount of the shortage from other reserve funds held by guar- anty agencies under procedures established by the Secretary.

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422 The Secretary shall first attempt to obtain the amount of such shortage from each guaranty agency that failed to transfer the agency’s required share to the agency’s restricted account in accordance with paragraph (4).
(6) ENFORCEMENT.— (A) IN GENERAL.—The Secretary may take such rea- sonable measures, and require such information, as may be necessary to ensure that guaranty agencies comply with the requirements of this subsection.
(B) PROHIBITION.—If the Secretary determines that a guaranty agency has failed to transfer to a restricted ac- count any portion of the agency’s required share under this subsection, the agency may not receive any other funds under this part until the Secretary determines that the agency has so transferred the agency’s required share.
(C) WAIVER.—The Secretary may waive the require- ments of subparagraph (B) for a guaranty agency de- scribed in such subparagraph if the Secretary determines that there are extenuating circumstances beyond the con- trol of the agency that justify such waiver.
(7) LIMITATION.— (A) RESTRICTION ON OTHER AUTHORITY.—The Secretary shall not have any authority to direct a guaranty agency to return reserve funds under subsection (g)(1)(A) during the period from the date of enactment of the Balanced Budget Act of 1997 through September 30, 2002.
(B) USE OF TERMINATION COLLECTIONS.—Any reserve funds directed by the Secretary to be returned to the Sec- retary under subsection (g)(1)(B) during such period that do not exceed a guaranty agency’s required share of re- called reserve funds under paragraph (3)— (i) shall be used to satisfy the agency’s required share of recalled reserve funds; and (ii) shall be deposited in the restricted account es- tablished by the agency under paragraph (4), without regard to whether such funds exceed the next install- ment required under such paragraph.
(C) USE OF SANCTIONS COLLECTIONS.—Any reserve funds directed by the Secretary to be returned to the Sec- retary under subsection (g)(1)(C) during such period that do not exceed a guaranty agency’s next installment under paragraph (4)— (i) shall be used to satisfy the agency’s next in- stallment; and (ii) shall be deposited in the restricted account es- tablished by the agency under paragraph (4).
(D) BALANCE AVAILABLE TO SECRETARY.—Any reserve funds directed by the Secretary to be returned to the Sec- retary under subparagraph (B) or (C) of subsection (g)(1) that remain after satisfaction of the requirements of sub- paragraphs (B) and (C) of this paragraph shall be depos- ited in the Treasury.

(8) DEFINITIONS.—For the purposes of this subsection: September 8, 2023 As Amended Through P.L.
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422 HIGHER EDUCATION ACT OF 1965 284 (A) DEFAULT REDUCTION ACTIVITIES.—The term ‘‘de- fault reduction activities’’ means activities to reduce stu- dent loan defaults that improve, strengthen, and expand default prevention activities, such as— (i) establishing a program of partial loan cancella- tion to reward disadvantaged borrowers for good re- payment histories with their lenders; (ii) establishing a financial and debt management counseling program for high-risk borrowers that pro- vides long-term training (beginning prior to the first disbursement of the borrower’s first student loan and continuing through the completion of the borrower’s program of education or training) in budgeting and other aspects of financial management, including debt management; (iii) establishing a program of placement coun- seling to assist high-risk borrowers in identifying em- ployment or additional training opportunities; and (iv) developing public service announcements that would detail consequences of student loan default and provide information regarding a toll-free telephone number established by the guaranty agency for use by borrowers seeking assistance in avoiding default.
(B) RESERVE FUNDS.—The term ‘‘reserve funds’’ when used with respect to a guaranty agency— (i) includes any reserve funds in cash or liquid as- sets held by the guaranty agency, or held by, or under the control of, any other entity; and (ii) does not include buildings, equipment, or other nonliquid assets.
(i) ADDITIONAL RECALL OF RESERVES.— (1) IN GENERAL.—Notwithstanding any other provision of law and subject to paragraph (4), the Secretary shall recall, from reserve funds held in the Federal Student Loan Reserve Funds established under section 422A by guaranty agencies— (A) $85,000,000 in fiscal year 2002; (B) $82,500,000 in fiscal year 2006; and (C) $82,500,000 in fiscal year 2007.

(2) DEPOSIT.—Funds recalled by the Secretary under this subsection shall be deposited in the Treasury.
(3) REQUIRED SHARE.—The Secretary shall require each guaranty agency to return reserve funds under paragraph (1) on the basis of the agency’s required share.

For purposes of this paragraph, a guaranty agency’s required share shall be de- termined as follows: (A) EQUAL PERCENTAGE.—The Secretary shall require each guaranty agency to return an amount representing an equal percentage reduction in the amount of reserve funds held by the agency on September 30, 1996.
(B) CALCULATION.—The equal percentage reduction shall be the percentage obtained by dividing— (i) $250,000,000, by September 8, 2023 As Amended Through P.L.

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422A (ii) the total amount of all guaranty agencies’ re- serve funds held on September 30, 1996, less any amounts subject to recall under subsection (h).
(C) SPECIAL RULE.—Notwithstanding subparagraphs (A) and (B), the percentage reduction under subparagraph (B) shall not result in the depletion of the reserve funds of any agency which charges the 1.0 percent insurance pre- mium pursuant to section 428(b)(1)(H) below an amount equal to the amount of lender claim payments paid during the 90 days prior to the date of the return under this sub- section.
If any additional amount is required to be re- turned after deducting the total of the required shares under subparagraph (B) and as a result of the preceding sentence, such additional amount shall be obtained by im- posing on each guaranty agency to which the preceding sentence does not apply, an equal percentage reduction in the amount of the agency’s remaining reserve funds.
(4) OFFSET OF REQUIRED SHARES.—If any guaranty agency returns to the Secretary any reserve funds in excess of the amount required under this subsection or subsection (h), the total amount required to be returned under paragraph (1) shall be reduced by the amount of such excess reserve funds re- turned.
(5) 15 DEFINITION OF RESERVE FUNDS.—The term ‘‘reserve funds’’ when used with respect to a guaranty agency— (A) includes any reserve funds in cash or liquid assets held by the guaranty agency, or held by, or under the con- trol of, any other entity; and (B) does not include buildings, equipment, or other nonliquid assets.

SEC.

422A.

ø20 U.S.C.

1072a¿ FEDERAL STUDENT LOAN RESERVE FUND.


(a) ESTABLISHMENT.—Each guaranty agency shall, not later than 60 days after the date of enactment of this section, deposit all funds, securities, and other liquid assets contained in the reserve fund established pursuant to section 422 into a Federal Student Loan Reserve Fund (in this section and section 422B referred to as the ‘‘Federal Fund’’), which shall be an account of a type selected by the agency, with the approval of the Secretary.
(b) INVESTMENT OF FUNDS.—Funds transferred to the Federal Fund shall be invested in obligations issued or guaranteed by the United States or a State, or in other similarly low-risk securities selected by the guaranty agency, with the approval of the Sec- retary.

Earnings from the Federal Fund shall be the sole property of the Federal Government.
(c) ADDITIONAL DEPOSITS.—After the establishment of the Fed- eral Fund, a guaranty agency shall deposit into the Federal Fund— (1) all amounts received from the Secretary as payment of reinsurance on loans pursuant to section 428(c)(1); (2) from amounts collected on behalf of the obligation of a defaulted borrower, a percentage amount equal to the com- plement of the reinsurance percentage in effect when payment under the guaranty agreement was made— September 8, 2023 As Amended Through P.L.
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422A HIGHER EDUCATION ACT OF 1965 286 (A) with respect to the defaulted loan pursuant to sec- tions 428(c)(6)(A) and 428F(a)(1)(B); and (B) with respect to a loan that the Secretary has re- paid or discharged under section 437; (3) insurance premiums collected from borrowers pursuant to sections 428(b)(1)(H) and 428H(h); (4) all amounts received from the Secretary as payment for supplemental preclaims activity performed prior to the date of enactment of this section; (5) 70 percent of amounts received after such date of enact- ment from the Secretary as payment for administrative cost al- lowances for loans upon which insurance was issued prior to such date of enactment; and (6) other receipts as specified in regulations of the Sec- retary.
(d) USES OF FUNDS.—Subject to subsection (f), the Federal Fund may only be used by a guaranty agency— (1) to pay lender claims pursuant to sections 428(b)(1)(G), 428(j), and 437; and (2) to pay into the Agency Operating Fund established pur- suant to section 422B (in this section and section 422B referred to as the ‘‘Operating Fund’’) a default aversion fee in accord- ance with section 428(l).
(e) OWNERSHIP OF FEDERAL FUND.—The Federal Fund, and any nonliquid asset (such as a building or equipment) developed or purchased by the guaranty agency in whole or in part with Federal reserve funds, regardless of who holds or controls the Federal re- serve funds or such asset, shall be considered to be the property of the United States, prorated based on the percentage of such asset developed or purchased with Federal reserve funds, which property shall be used in the operation of the program authorized by this part, as provided in subsection (d).
The Secretary may re- strict or regulate the use of such asset only to the extent necessary to reasonably protect the Secretary’s prorated share of the value of such asset.

The Secretary may direct a guaranty agency, or such agency’s officers or directors, to cease any activity involving ex- penditures, use, or transfer of the Federal Fund administered by the guaranty agency is a misapplication, misuse, or improper expenditure of the Federal Fund or the Secretary’s share of such asset.
the Secretary determines that (f) TRANSITION.— (1) IN GENERAL.—In order to establish the Operating Fund, each guaranty agency may transfer not more than 180 days’ cash expenses for normal operating expenses (not including claim payments) as a working capital reserve as defined in Of- fice of Management and Budget Circular A–87 (Cost Account- ing Standards) from the Federal Fund for deposit into the Op- erating Fund for use in the performance of the guaranty agen- cy’s duties under this part.
Such transfers may occur during the first 3 years following the establishment of the Operating Fund.

However, no agency may transfer in excess of 45 percent of the balance, as of September 30, 1998, of the agency’s Fed- eral Fund to the agency’s Operating Fund during such 3-year period.

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422A the agency shall ensure that sufficient funds remain in the Federal Fund to pay lender claims within the required time pe- riods and to meet the reserve recall requirements of this sec- tion and subsections (h) and (i) of section 422.
(2) SPECIAL RULE.—A limited number of guaranty agencies may transfer interest earned on the Federal Fund to the Oper- ating Fund during the first 3 years after the date of enactment of this section if the guaranty agency demonstrates to the Sec- retary that— (A) the cash flow in the Operating Fund will be nega- tive without the transfer of such interest; and (B) the transfer of such interest will substantially im- prove the financial circumstances of the guaranty agency.
(3) REPAYMENT PROVISIONS.—Each guaranty agency shall begin repayment of sums transferred pursuant to this sub- section not later than the start of the fourth year after the es- tablishment of the Operating Fund, and shall repay all amounts transferred not later than 5 years from the date of the establishment of the Operating Fund.

With respect to amounts transferred from the Federal Fund, the guaranty agency shall not be required to repay any interest on the funds transferred and subsequently repaid.
The guaranty agency shall provide to the Secretary a reasonable schedule for repay- ment of the sums transferred and an annual financial analysis demonstrating the agency’s ability to comply with the schedule and repay all outstanding sums transferred.
(4) PROHIBITION.—If a guaranty agency transfers funds from the Federal Fund in accordance with this section, and fails to make scheduled repayments to the Federal Fund, the agency may not receive any other funds under this part until the Secretary determines that the agency has made such re- payments.

The Secretary shall pay to the guaranty agency any funds withheld in accordance with this paragraph immediately upon making the determination that the guaranty agency has made all such repayments.
(5) WAIVER.—The Secretary may— (A) waive the requirements of paragraph (3), but only with respect to repayment of interest that was transferred in accordance with paragraph (2); and (B) waive paragraph (4); for a guaranty agency, if the Secretary determines that there are extenuating circumstances (such as State constitutional prohibitions) beyond the control of the agency that justify such a waiver.
(6) EXTENSION OF REPAYMENT PERIOD FOR INTEREST.— (A) EXTENSION PERMITTED.—The Secretary shall ex- tend the period for repayment of interest that was trans- ferred in accordance with paragraph (2) from 2 years to 5 years if the Secretary determines that— (i) the cash flow of the Operating Fund will be negative as a result of repayment as required by para- graph (3); September 8, 2023 As Amended Through P.L.
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422B HIGHER EDUCATION ACT OF 1965 288 (ii) the repayment of the interest transferred will substantially diminish the financial circumstances of the guaranty agency; and (iii) the guaranty agency has demonstrated— (I) that the agency is able to repay all trans- ferred funds by the end of the 8th year following the date of establishment of the Operating Fund; and (II) that the agency will be financially sound on the completion of repayment.
(B) REPAYMENT OF INCOME ON TRANSFERRED FUNDS.— All repayments made to the Federal Fund during the 6th, 7th, and 8th years following the establishment of the Op- erating Fund of interest that was transferred shall include the sums transferred plus any income earned from the in- vestment of the sums transferred after the 5th year.
(7) INVESTMENT OF FEDERAL FUNDS.—Funds transferred from the Federal Fund to the Operating Fund for operating ex- penses shall be invested in obligations issued or guaranteed by the United States or a State, or in other similarly low-risk se- curities selected by the guaranty agency, with the approval of the Secretary.
(8) SPECIAL RULE.—In calculating the minimum reserve level required by section 428(c)(9)(A), the Secretary shall in- clude all amounts owed to the Federal Fund by the guaranty agency in the calculation.

SEC.

422B.

ø20 U.S.C.

1072b¿ AGENCY OPERATING FUND.

(a) ESTABLISHMENT.—Each guaranty agency shall, not later than 60 days after the date of enactment of this section, establish a fund designated as the Operating Fund.
(b) INVESTMENT OF FUNDS.—Funds deposited into the Oper- ating Fund shall be invested at the discretion of the guaranty agency in accordance with prudent investor standards.
(c) ADDITIONAL DEPOSITS.—After the establishment of the Op- erating Fund, the guaranty agency shall deposit into the Operating Fund— (1) the loan processing and issuance fee paid by the Secretary pursuant to section 428(f); (2) 30 percent of amounts received after the date of enact- ment of this section from the Secretary as payment for admin- istrative cost allowances for loans upon which insurance was issued prior to such date of enactment; (3) the account maintenance fee paid by the Secretary in accordance with section 458; (4) the default aversion fee paid in accordance with section 428(l); (5) amounts remaining pursuant to section 428(c)(6)(B) from collection on defaulted loans held by the agency, after payment of the Secretary’s equitable share, excluding amounts deposited in the Federal Fund pursuant to section 422A(c)(2); and (6) other receipts as specified in regulations of the Secretary.
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422B (d) USES OF FUNDS.— (1) IN GENERAL.—Funds in the Operating Fund shall be used for application processing, loan disbursement, enrollment and repayment status management, default aversion activities (including those described in section 422(h)(8)), default collec- tion activities, school and lender training, financial aid aware- ness and related outreach activities, compliance monitoring, and other student financial aid related activities, as selected by the guaranty agency.
(2) SPECIAL RULE.—The guaranty agency may, in the agen- cy’s discretion, transfer funds from the Operating Fund to the Federal Fund for use pursuant to section 422A.

Such transfer shall be irrevocable, and any funds so transferred shall become the sole property of the United States.
(3) DEFINITIONS.—For purposes of this subsection: (A) DEFAULT COLLECTION ACTIVITIES.—The term ‘‘de- fault collection activities’’ means activities of a guaranty agency that are directly related to the collection of the loan on which a default claim has been paid to the participating lender, including the due diligence activities required pur- suant to regulations of the Secretary.
(B) DEFAULT AVERSION ACTIVITIES.—The term ‘‘default aversion activities’’ means activities of a guaranty agency that are directly related to providing collection assistance to the lender on a delinquent loan, prior to the loan’s being legally in a default status, including due diligence activi- ties required pursuant to regulations of the Secretary.
(C) ENROLLMENT AND REPAYMENT STATUS MANAGE- MENT.—The term ‘‘enrollment and repayment status man- agement’’ means activities of a guaranty agency that are directly related to ascertaining the student’s enrollment status, including prompt notification to the lender of such status, an audit of the note or written agreement to deter- mine if the provisions of that note or agreement are con- sistent with the records of the guaranty agency as to the principal amount of the loan guaranteed, and an examina- tion of the note or agreement to assure that the repayment provisions are consistent with the provisions of this part.
(e) OWNERSHIP AND REGULATION OF OPERATING FUND.— (1) OWNERSHIP.—The Operating Fund, with the exception of funds transferred from the Federal Fund in accordance with section 422A(f), shall be considered to be the property of the guaranty agency.

(2) REGULATION.—Except as provided in paragraph (3), the Secretary may not regulate the uses or expenditure of moneys in the Operating Fund, but the Secretary may require such necessary reports and audits as provided in section 428(b)(2).
(3) EXCEPTION.—Notwithstanding paragraphs (1) and (2), during any period in which funds are owed to the Federal Fund as a result of transfer under section 422A(f)— (A) moneys in the Operating Fund may only be used for expenses related to the student loan programs author- ized under this part; and September 8, 2023 As Amended Through P.L.
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423 HIGHER EDUCATION ACT OF 1965 290 (B) the Secretary may regulate the uses or expendi- ture of moneys in the Operating Fund.

SEC.

423. ø20 U.S.C.

1073¿ EFFECTS OF ADEQUATE NON-FEDERAL PRO- GRAMS.


(a) FEDERAL INSURANCE BARRED TO LENDERS WITH ACCESS TO STATE OR PRIVATE INSURANCE.—Except as provided in subsection (b), the Secretary shall not issue certificates of insurance under section 429 to lenders in a State if the Secretary determines that every eligible institution has reasonable access in that State to a State or private nonprofit student loan insurance program which is covered by an agreement under section 428(b).
(b) EXCEPTIONS.—The Secretary may issue certificates of insur- ance under section 429 to a lender in a State— (1) for insurance of a loan made to a student borrower who does not, by reason of the borrower’s residence, have access to loan insurance under the loan insurance program of such State (or under any private nonprofit loan insurance program which has received an advance under section 422 for the benefit of students in such State); (2) for insurance of all the loans made to student bor- rowers by a lender who satisfies the Secretary that, by reason of the residence of such borrowers, such lender will not have access to any single State or nonprofit private loan insurance program which will insure substantially all of the loans such lender intends to make to such student borrowers; or (3) under such circumstances as may be approved by the guaranty agency in such State, for the insurance of a loan to a borrower for whom such lender previously was issued such a certificate if the loan covered by such certificate is not yet re- paid.
SEC.

424. ø20 U.S.C.

1074¿ SCOPE AND DURATION OF FEDERAL LOAN IN- SURANCE PROGRAM.
(a) LIMITATIONS ON AMOUNTS OF LOANS COVERED BY FEDERAL INSURANCE.—The total principal amount of new loans made and in- stallments paid pursuant to lines of credit (as defined in section 435) to students covered by Federal loan insurance under this part shall not exceed $2,000,000,000 for the period from July 1, 1976, to September 30, 1976, for each of the succeeding fiscal years end- ing prior to October 1, 2009, and for the period from October 1, 2009, to June 30, 2010, for loans first disbursed on or before June 30, 2010.
(b) APPORTIONMENT OF AMOUNTS.—The Secretary may, if he or she finds it necessary to do so in order to assure an equitable dis- tribution of the benefits of this part, assign, within the maximum amounts specified in subsection (a), Federal loan insurance quotas applicable to eligible lenders, or to States or areas, and may from time to time reassign unused portions of these quotas.

SEC.

425. ø20 U.S.C.

1075¿ LIMITATIONS ON INDIVIDUAL FEDERALLY IN- SURED LOANS AND ON FEDERAL LOAN INSURANCE.
(a) ANNUAL AND AGGREGATE LIMITS.— (1) ANNUAL LIMITS.—(A) The total of loans made to a stu- dent in any academic year or its equivalent (as determined by September 8, 2023 As Amended Through P.L.

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425 the Secretary) which may be covered by Federal loan insurance under this part may not exceed— (i) in the case of a student at an eligible institution who has not successfully completed the first year of a pro- gram of undergraduate education— (I) $3,500, if such student is enrolled in a program whose length is at least one academic year in length (as determined under section 481); and (II) if such student is enrolled in a program of un- dergraduate education which is less than one aca- demic year, the maximum annual loan amount that such student may receive may not exceed the amount that bears the same ratio to the amount specified in subclause (I) as the length of such program measured in semester, trimester, quarter, or clock hours bears to one academic year; (ii) in the case of a student at an eligible institution who has successfully completed such first year but has not successfully completed the remainder of a program of un- dergraduate education— (I) $4,500; or (II) if such student is enrolled in a program of un- dergraduate education, the remainder of which is less than one academic year, the maximum annual loan amount that such student may receive may not exceed the amount that bears the same ratio to the amount specified in subclause (I) as such remainder measured in semester, trimester, quarter, or clock hours bears to one academic year; (iii) in the case of a student at an eligible institution who has successfully completed the first and second years of a program of undergraduate education but has not suc- cessfully completed the remainder of such program— (I) $5,500; or (II) if such student is enrolled in a program of un- dergraduate education, the remainder of which is less than one academic year, the maximum annual loan amount that such student may receive may not exceed the amount that bears the same ratio to the amount specified in subclause (I) as such remainder measured in semester, trimester, quarter, or clock hours bears to one academic year; and (iv) in the case of a graduate or professional student (as defined in regulations of the Secretary) at an eligible institution, $8,500.
(B) The annual insurable limits contained in subparagraph (A) shall not apply in cases where the Secretary determines, pursuant to regulations, that a higher amount is warranted in order to carry out the purpose of this part with respect to stu- dents engaged in specialized training requiring exceptionally high costs of education.
The annual insurable limit per student shall not be deemed to be exceeded by a line of credit under which actual payments by the lender to the borrower will not be made in any year in excess of the annual limit.

September 8, 2023 As Amended Through P.L.

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425 HIGHER EDUCATION ACT OF 1965 292 (C) For the purpose of subparagraph (A), the number of years that a student has completed in a program of under- graduate education shall include any prior enrollment in an el- igible program of undergraduate education for which the stu- dent was awarded an associate or baccalaureate degree, if such degree is required by the institution for admission to the pro- gram in which the student is enrolled.
(2) AGGREGATE LIMITS.—(A) The aggregate insured unpaid principal amount for all such insured loans made to any stu- dent shall not at any time exceed— (i) $23,000, in the case of any student who has not success- fully completed a program of undergraduate education, exclud- ing loans made under section 428A or 428B; and (ii) $65,500, in the case of any graduate or professional student (as defined by regulations of the Secretary) and (I) in- cluding any loans which are insured by the Secretary under this section, or by a guaranty agency, made to such student be- fore the student became a graduate or professional student), but (II) excluding loans made under section 428A or 428B, except that the Secretary may increase the limit applicable to stu- dents who are pursuing programs which the Secretary determines are exceptionally expensive.
RATE.— (B) The Secretary may increase the aggregate insurable limit applicable to students who are pursuing programs which the Secretary determines are exceptionally expensive.
(b) LEVEL OF INSURANCE COVERAGE BASED ON DEFAULT (1) REDUCTION FOR DEFAULTS IN EXCESS OF 5 OR 9 PER- CENT.—(A) Except as provided in subparagraph (B), the insur- ance liability on any loan insured by the Secretary under this part shall be 100 percent of the unpaid balance of the principal amount of the loan plus interest, except that— (i) if, for any fiscal year, the total amount of payments under section 430 by the Secretary to any eligible lender as described in section 435(d)(1)(D) exceeds 5 percent of the sum of the loans made by such lender which are in- sured by the Secretary and which were in repayment at the end of the preceding fiscal year, the insurance liability under this subsection for that portion of such excess which represents loans insured after the applicable date with re- spect to such loans, as determined under subparagraph (C), shall be equal to 90 percent of the amount of such por- tion; or (ii) if, for any fiscal year, the total amount of such pay- ments to such a lender exceeds 9 percent of such sum, the insurance liability under this subsection for that portion of such excess which represents loans insured after the appli- cable date with respect to such loans, as determined under subparagraph (C), shall be equal to 80 percent of the amount of such portion.
(B) Notwithstanding subparagraph (A), the provisions of clauses (i) and (ii) of such subparagraph shall not apply to an eligible lender as described in section 435(d)(1)(D) for the fiscal September 8, 2023 As Amended Through P.L.

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427 year in which such lender begins to carry on a loan program insured by the Secretary, or for any of the 4 succeeding fiscal years.
(C) The applicable date with respect to a loan made by an eligible lender as described in section 435(d)(1)(D) shall be— (i) the 90th day after the adjournment of the next reg- ular session of the appropriate State legislature which con- venes after the date of enactment of the Education Amend- ments of 1976, or (ii) if the primary source of lending capital for such lender is derived from the sale of bonds, and the constitu- tion of the appropriate State prohibits a pledge of such State’s credit as security against such bonds, the day which is one year after such 90th day.
(2) COMPUTATION OF AMOUNTS IN REPAYMENT.—For the purpose of this subsection, the sum of the loans made by a lender which are insured by the Secretary and which are in re- payment shall be the original principal amount of loans made by such lender which are insured by the Secretary reduced by— (A) the amount the Secretary has been required to pay to discharge his or her insurance obligations under this part; (B) the original principal amount of loans insured by the Secretary which have been fully repaid; (C) the original principal amount insured on those loans for which payment of first installment of principal has not become due pursuant to section 427(a)(2)(B) or such first installment need not be paid pursuant to section 427(a)(2)(C); and (D) the original principal amount of loans repaid by the Secretary under section 437.
(3) PAYMENTS TO ASSIGNEES.—For the purpose of this sub- section, payments by the Secretary under section 430 to an as- signee of the lender with respect to a loan shall be deemed payments made to such lender.

(4) PLEDGE OF FULL FAITH AND CREDIT.—The full faith and credit of the United States is pledged to the payment of all amounts which may be required to be paid under the provi- sions of section 430 or 437 of this part.

SEC.

426. ø20 U.S.C.

1076¿ SOURCES OF FUNDS.


Loans made by eligible lenders in accordance with this part shall be insurable by the Secretary whether made from funds fully owned by the lender or from funds held by the lender in a trust or similar capacity and available for such loans.

SEC.

427. ø20 U.S.C.

1077¿ ELIGIBILITY OF STUDENT BORROWERS AND TERMS OF FEDERALLY INSURED STUDENT LOANS.
(a) LIST OF REQUIREMENTS.—Except as provided in section 428C, a loan by an eligible lender shall be insurable by the Sec- retary under the provisions of this part only if— (1) made to a student who (A) is an eligible student under section 484, (B) has agreed to notify promptly the holder of the loan concerning any change of address, and (C) is carrying at September 8, 2023 As Amended Through P.L.
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427 HIGHER EDUCATION ACT OF 1965 294 least one-half the normal full-time academic workload for the course of study the student is pursuing (as determined by the institution); and (2) evidenced by a note or other written agreement which— (A) is made without security and without endorse- ment; (B) provides for repayment (except as provided in sub- section (c)) of the principal amount of the loan in install- ments over a period of not less than 5 years (unless sooner repaid or unless the student, during the 6 months pre- ceding the start of the repayment period, specifically re- quests that repayment be made over a shorter period) nor more than 10 years beginning 6 months after the month in which the student ceases to carry at an eligible institu- tion at least one-half the normal full-time academic work- load as determined by the institution, except— (i) as provided in subparagraph (C); (ii) that the note or other written instrument may contain such reasonable provisions relating to repay- ment in the event of default in the payment of interest or in the payment of the cost of insurance premiums, or other default by the borrower, as may be authorized by regulations of the Secretary in effect at the time the loan is made; and (iii) that the lender and the student, after the stu- dent ceases to carry at an eligible institution at least one-half the normal full-time academic workload as determined by the institution, may agree to a repay- ment schedule which begins earlier, or is of shorter duration, than required by this subparagraph, but in the event a borrower has requested and obtained a re- payment period of less than 5 years, the borrower may at any time prior to the total repayment of the loan, have the repayment period extended so that the total repayment period is not less than 5 years; (C) provides that periodic installments of principal need not be paid, but interest shall accrue and be paid, during any period— (i) during which the borrower— (I) is pursuing at least a half-time course of study as determined by an eligible institution; or (II) is pursuing a course of study pursuant to a graduate fellowship program approved by the Secretary, or pursuant to a rehabilitation training program for individuals with disabilities approved by the Secretary, except that no borrower shall be eligible for a deferment under this clause, or a loan made under this part (other than a loan made under section 428B or 428C), while serving in a medical internship or resi- dency program; September 8, 2023 As Amended Through P.L.
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427 (ii) not in excess of 3 years during which the bor- rower is seeking and unable to find full-time employ- ment; (iii) not in excess of 3 years for any reason which the lender determines, in accordance with regulations prescribed by the Secretary under section 435(o), has caused or will cause the borrower to have an economic hardship; or (iv) in which the borrower is receiving treatment for cancer and the 6 months after such period.
and provides that any such period shall not be included in determining the 10-year period described in subparagraph (B); (D) provides for interest on the unpaid principal bal- ance of the loan at a yearly rate, not exceeding the applica- ble maximum rate prescribed in section 427A, which inter- est shall be payable in installments over the period of the loan except that, if provided in the note or other written agreement, any interest payable by the student may be de- ferred until not later than the date upon which repayment of the first installment of principal falls due, in which case interest accrued during that period may be added on that date to the principal; (E) provides that the lender will not collect or attempt to collect from the borrower any portion of the interest on the note which is payable by the Secretary under this part, and that the lender will enter into such agreements with the Secretary as may be necessary for the purpose of sec- tion 437; (F) entitles the student borrower to accelerate without penalty repayment of the whole or any part of the loan; (G)(i) contains a notice of the system, of disclosure of information concerning such loan to consumer reporting agencies under section 430A, and (ii) provides that the lender on request of the borrower will provide information on the repayment status of the note to such consumer re- porting agencies; (H) provides that, no more than 6 months prior to the date on which the borrower’s first payment on a loan is due, the lender shall offer the borrower the option of re- paying the loan in accordance with a graduated or income- sensitive repayment schedule established by the lender and in accordance with the regulations of the Secretary; and (I) contains such other terms and conditions, con- sistent with the provisions of this part and with the regu- lations issued by the Secretary pursuant to this part, as may be agreed upon by the parties to such loan, including, if agreed upon, a provision requiring the borrower to pay the lender, in addition to principal and interest, amounts equal to the insurance premiums payable by the lender to the Secretary with respect to such loan; (3) the funds borrowed by a student are disbursed to the institution by check or other means that is payable to and re- September 8, 2023 As Amended Through P.L.
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427A HIGHER EDUCATION ACT OF 1965 296 quires the endorsement or other certification by such student, except— (A) that nothing in this title shall be interpreted— (i) to allow the Secretary to require checks to be made copayable to the institution and the borrower; or (ii) to prohibit the disbursement of loan proceeds by means other than by check; and (B) in the case of any student who is studying outside the United States in a program of study abroad that is ap- proved for credit by the home institution at which such student is enrolled, the funds shall, at the request of the borrower, be delivered directly to the student and the checks may be endorsed, and fund transfers authorized, pursuant to an authorized power-of-attorney; and (4) the funds borrowed by a student are disbursed in ac- cordance with section 428G.
(b) SPECIAL RULES FOR MULTIPLE DISBURSEMENT.—For the purpose of subsection (a)(4)— (1) all loans issued for the same period of enrollment shall be considered as a single loan; and (2) the requirements of such subsection shall not apply in the case of a loan made under section 428B or 428C, or made to a student to cover the cost of attendance at an eligible insti- tution outside the United States.
(c) SPECIAL REPAYMENT RULES.—Except as provided in sub- section (a)(2)(H), the total of the payments by a borrower during any year of any repayment period with respect to the aggregate amount of all loans to that borrower which are insured under this part shall not, unless the borrower and the lender otherwise agree, be less than $600 or the balance of all such loans (together with interest thereon), whichever amount is less (but in no instance less than the amount of interest due and payable).

SEC.

427A.
SEC.

427A.

ø20 U.S.C.

1077a¿ APPLICABLE INTEREST RATES.
(a) RATES TO BE CONSISTENT FOR BORROWER’S ENTIRE DEBT.— With respect to any loan to cover the cost of instruction for any pe- riod of instruction beginning on or after January 1, 1981, the rate of interest applicable to any borrower shall— (1) not exceed 7 percent per year on the unpaid principal balance of the loan in the case of any borrower who, on the date of entering into the note or other written evidence of that loan, has an outstanding balance of principal or interest on any loan made, insured, or guaranteed under this part, for which the interest rate does not exceed 7 percent; (2) except as provided in paragraph (3), be 9 percent per year on the unpaid principal balance of the loan in the case of any borrower who, on the date of entering into the note or other written evidence of that loan, has no outstanding balance of principal or interest on any loan described in paragraph (1) or any loan for which the interest rate is determined under paragraph (1); or (3) be 8 percent per year on the unpaid principal balance of the loan for a loan to cover the cost of education for any pe- riod of enrollment beginning on or after a date which is 3 September 8, 2023 As Amended Through P.L.
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427A months after a determination made under subsection (b) in the case of any borrower who, on the date of entering into the note or other written evidence of the loan, has no outstanding bal- ance of principal or interest on any loan for which the interest rate is determined under paragraph (1) or (2) of this sub- section.
(b) REDUCTION FOR NEW BORROWERS AFTER DECLINE IN TREASURY BILL RATES.—If for any 12-month period beginning on or after January 1, 1981, the Secretary, after consultation with the Secretary of the Treasury, determines that the average of the bond equivalent rates of 91-day Treasury bills auctioned for such 12- month period is equal to or less than 9 percent, the interest rate for loans under this part shall be the rate prescribed in subsection (a)(3) for borrowers described in such subsection.
(c) RATES FOR SUPPLEMENTAL LOANS FOR STUDENTS AND LOANS FOR PARENTS.— (1) IN GENERAL.—Except as otherwise provided in this sub- section, the applicable rate of interest on loans made pursuant to section 428A or 428B on or after October 1, 1981, shall be 14 percent per year on the unpaid principal balance of the loan.
(2) REDUCTION OF RATE AFTER DECLINE IN TREASURY BILL RATES.—If for any 12-month period beginning on or after Octo- ber 1, 1981, the Secretary, after consultation with the Sec- retary of the Treasury, determines that the average of the bond equivalent rates of 91-day Treasury bills auctioned for such 12-month period is equal to or less than 14 percent, the applicable rate of interest for loans made pursuant to section 428A or 428B on and after the first day of the first month be- ginning after the date of publication of such determination shall be 12 percent per year on the unpaid principal balance of the loan.
(3) INCREASE OF RATE AFTER INCREASE IN TREASURY BILL RATES.—If for any 12-month period beginning on or after the date of publication of a determination under paragraph (2), the Secretary, after consultation with the Secretary of the Treas- ury, determines that the average of the bond equivalent rates of 91-day Treasury bills auctioned for such 12-month period ex- ceeds 14 percent, the applicable rate of interest for loans made pursuant to section 428A or 428B on and after the first day of the first month beginning after the date of publication of that determination under this paragraph shall be 14 percent per year on the unpaid principal balance of the loan.
(4) AVAILABILITY OF VARIABLE RATES.—(A) For any loan made pursuant to section 428A or 428B and disbursed on or after July 1, 1987, or any loan made pursuant to such section prior to such date that is refinanced pursuant to section 428A(d) or 428B(d), the applicable rate of interest during any 12-month period beginning on July 1 and ending on June 30 shall be determined under subparagraph (B), except that such rate shall not exceed 12 percent.
(B)(i) For any 12-month period beginning on July 1 and ending on or before June 30, 2001, the rate deter- September 8, 2023 As Amended Through P.L.

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427A HIGHER EDUCATION ACT OF 1965 298 mined under this subparagraph is determined on the pre- ceding June 1 and is equal to— (I) the bond equivalent rate of 52-week Treasury bills auctioned at the final auction held prior to such June 1; plus (II) 3.25 percent.
(ii) For any 12-month period beginning on July 1 of 2001 or any succeeding year, the rate determined under this subparagraph is determined on the preceding June 26 and is equal to— (I) the weekly average 1-year constant maturity Treasury yield, as published by the Board of Gov- ernors of the Federal Reserve System, for the last cal- endar week ending on or before such June 26; plus (II) 3.25 percent.
(C) The Secretary shall determine the applicable rate of in- terest under subparagraph (B) after consultation with the Sec- retary of the Treasury and shall publish such rate in the Fed- eral Register as soon as practicable after the date of deter- mination.
(D) Notwithstanding subparagraph (A)— (i) for any loan made pursuant to section 428A for which the first disbursement is made on or after October 1, 1992— (I) subparagraph (B) shall be applied by sub- stituting ‘‘3.1’’ for ‘‘3.25’’; and (II) the interest rate shall not exceed 11 percent; and (ii) for any loan made pursuant to section 428B for which the first disbursement is made on or after October 1, 1992— (I) subparagraph (B) shall be applied by sub- stituting ‘‘3.1’’ for ‘‘3.25’’; and (II) the interest rate shall not exceed 10 percent.
(E) Notwithstanding subparagraphs (A) and (D) for any loan made pursuant to section 428B for which the first dis- bursement is made on or after July 1, 1994— (i) subparagraph (B) shall be applied by substituting ‘‘3.1’’ for ‘‘3.25’’; and (ii) the interest rate shall not exceed 9 percent.
(d) INTEREST RATES FOR NEW BORROWERS AFTER JULY 1, 1988.—Notwithstanding subsections (a) and (b) of this section, with respect to any loan (other than a loan made pursuant to sections 428A, 428B, and 428C) to cover the cost of instruction for any pe- riod of enrollment beginning on or after July 1, 1988, to any bor- rower who, on the date of entering into the note or other written evidence of the loan, has no outstanding balance of principal or in- terest on any loan made, insured, or guaranteed under this part, the applicable rate of interest shall be— (1) 8 percent per year on the unpaid principal balance of the loan during the period beginning on the date of the dis- bursement of the loan and ending 4 years after the commence- ment of repayment; and September 8, 2023 As Amended Through P.L.
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427A 1992.— (2) 10 percent per year on the unpaid principal balance of the loan during the remainder of the repayment period.
(e) INTEREST RATES FOR NEW BORROWERS AFTER OCTOBER 1, (1) IN GENERAL.—Notwithstanding subsections (a), (b), and (d) of this section, with respect to any loan (other than a loan made pursuant to sections 428A, 428B and 428C) for which the first disbursement is made on or after October 1, 1992, to any borrower who, on the date of entering into the note or other written evidence of the loan, has no outstanding balance of principal or interest on any loan made, insured, or guaranteed under section 427, 428, or 428H of this part, the applicable rate of interest shall, during any 12-month period beginning on July 1 and ending on June 30, be determined on the preceding June 1 and be equal to— (A) the bond equivalent rate of 91-day Treasury bills auctioned at the final auction held prior to such June 1; plus (B) 3.10 percent, except that such rate shall not exceed 9 percent.
(2) CONSULTATION.—The Secretary shall determine the ap- plicable rate of interest under paragraph (1) after consultation with the Secretary of the Treasury and shall publish such rate in the Federal Register as soon as practicable after the date of determination.
(f) INTEREST RATES FOR NEW LOANS AFTER JULY 1, 1994.— (1) IN GENERAL.—Notwithstanding subsections (a), (b), (d), and (e) of this section, with respect to any loan made, insured, or guaranteed under this part (other than a loan made pursu- ant to section 428B or 428C) for which the first disbursement is made on or after July 1, 1994, the applicable rate of interest shall, during any 12-month period beginning on July 1 and ending on June 30, be determined on the preceding June 1 and be equal to— (A) the bond equivalent rate of 91-day Treasury bills auctioned at the final auction held prior to such June 1; plus (B) 3.10 percent, except that such rate shall not exceed 8.25 percent.
(2) CONSULTATION.—The Secretary shall determine the ap- plicable rate of interest under paragraph (1) after consultation with the Secretary of the Treasury and shall publish such rate in the Federal Register as soon as practicable after the date of determination.
(g) IN SCHOOL AND GRACE PERIOD RULES.— (1) GENERAL RULE.—Notwithstanding the provisions of subsection (f), but subject to subsection (h), with respect to any loan under section 428 or 428H of this part for which the first disbursement is made on or after July 1, 1995, the applicable rate of interest for interest which accrues— (A) prior to the beginning of the repayment period of the loan; or (B) during the period in which principal need not be paid (whether or not such principal is in fact paid) by rea- September 8, 2023 As Amended Through P.L.
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427A HIGHER EDUCATION ACT OF 1965 300 son of a provision described in section 428(b)(1)(M) or 427(a)(2)(C), shall not exceed the rate determined under paragraph (2).
(2) RATE DETERMINATION.—For purposes of paragraph (1), the rate determined under this paragraph shall, during any 12-month period beginning on July 1 and ending on June 30, be determined on the preceding June 1 and be equal to— (A) the bond equivalent rate of 91-day Treasury bills auctioned at the final auction prior to such June 1; plus (B) 2.5 percent, except that such rate shall not exceed 8.25 percent.
(3) CONSULTATION.—The Secretary shall determine the ap- plicable rate of interest under this subsection after consulta- tion with the Secretary of the Treasury and shall publish such rate in the Federal Register as soon as practicable after the date of determination.
(h) INTEREST RATES FOR NEW LOANS AFTER JULY 1, 1998.— (1) IN GENERAL.—Notwithstanding subsections (a), (b), (d), (e), (f), and (g) of this section, with respect to any loan made, insured, or guaranteed under this part (other than a loan made pursuant to sections 428B and 428C) for which the first dis- bursement is made on or after July 1, 1998, the applicable rate of interest shall, during any 12-month period beginning on July 1 and ending on June 30, be determined on the preceding June 1 and be equal to— (A) the bond equivalent rate of the securities with a comparable maturity as established by the Secretary; plus (B) 1.0 percent, except that such rate shall not exceed 8.25 percent.
(2) INTEREST RATES FOR NEW PLUS LOANS AFTER JULY 1, 1998.—Notwithstanding subsections (a), (b), (d), (e), (f), and (g), with respect to any loan made under section 428B for which the first disbursement is made on or after July 1, 1998, para- graph (1) shall be applied— (A) by substituting ‘‘2.1 percent’’ for ‘‘1.0 percent’’ in subparagraph (B); and (B) by substituting ‘‘9.0 percent’’ for ‘‘8.25 percent’’ in the matter following such subparagraph.
(3) CONSULTATION.—The Secretary shall determine the ap- plicable rate of interest under this subsection after consulta- tion with the Secretary of the Treasury and shall publish such rate in the Federal Register as soon as practicable after the date of determination.
(i) TREATMENT OF EXCESS INTEREST PAYMENTS ON NEW BOR- ROWER ACCOUNTS RESULTING FROM DECLINE IN TREASURY BILL RATES.— (1) EXCESS INTEREST ON 10 PERCENT LOANS.—If, with re- spect to a loan for which the applicable interest rate is 10 per- cent under subsection (d) of this section at the close of any cal- endar quarter, the sum of the average of the bond equivalent rates of 91-day Treasury bills auctioned for that quarter and 3.25 percent is less than 10 percent, then an adjustment shall be made to a borrower’s account— September 8, 2023 As Amended Through P.L.
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427A (A) by calculating excess interest in the amount com- puted under paragraph (2) of this subsection; and (B)(i) during any period in which a student is eligible to have interest payments paid on his or her behalf by the Government pursuant to section 428(a), by crediting the excess interest to the Government; or (ii) during any other period, by crediting such excess interest to the reduction of principal to the extent provided in paragraph (5) of this subsection.
(2) AMOUNT OF ADJUSTMENT FOR 10 PERCENT LOANS.—The amount of any adjustment of interest on a loan to be made under this subsection for any quarter shall be equal to— (A) 10 percent minus the sum of (i) the average of the bond equivalent rates of 91-day Treasury bills auctioned for such calendar quarter, and (ii) 3.25 percent; multiplied by (B) the average daily principal balance of the loan (not including unearned interest added to principal) during such calendar quarter; divided by (C) four.
(3) EXCESS INTEREST ON LOANS AFTER 1992 AMENDMENTS, TO BORROWERS WITH OUTSTANDING BALANCES.—If, with respect to a loan made on or after the date of enactment of the Higher Education Amendments of 1992 to a borrower, who on the date of entering into the note or other written evidence of the loan, has an outstanding balance of principal or interest on any other loan made, insured, or guaranteed under this part, the sum of the average of the bond equivalent rates of 91-day Treasury bills auctioned for that quarter and 3.1 percent is less than the applicable interest rate, then an adjustment shall be made— (A) by calculating excess interest in the amount com- puted under paragraph (4) of this subsection; and (B)(i) during any period in which a student is eligible to have interest payments paid on his or her behalf by the Government pursuant to section 428(a), by crediting the excess interest to the Government; or (ii) during any other period, by crediting such excess interest to the reduction of principal to the extent provided in paragraph (5) of this subsection.
(4) AMOUNT OF ADJUSTMENT.—The amount of any adjust- ment of interest on a loan to be made under this subsection for any quarter shall be equal to— (A) the applicable interest rate minus the sum of (i) the average of the bond equivalent rates of 91-day Treas- ury bills auctioned for such calendar quarter, and (ii) 3.1 percent; multiplied by (B) the average daily principal balance of the loan (not including unearned interest added to principal) during such calendar quarter; divided by (C) four.
(5) ANNUAL ADJUSTMENT OF INTEREST AND BORROWER ELI- GIBILITY FOR CREDIT.—Any adjustment amount computed pur- suant to paragraphs (2) and (4) of this subsection for any quar- September 8, 2023 As Amended Through P.L.

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427A HIGHER EDUCATION ACT OF 1965 302 ter shall be credited, by the holder of the loan on the last day of the calendar year in which such quarter falls, to the loan ac- count of the borrower so as to reduce the principal balance of such account.

No such credit shall be made to the loan account of a borrower who on the last day of the calendar year is delin- quent for more than 30 days in making a required payment on the loan, but the excess interest shall be calculated and cred- ited to the Secretary.
Any credit which is to be made to a bor- rower’s account pursuant to this subsection shall be made ef- fective commencing no later than 30 days following the last day of the calendar year in which the quarter falls for which the credit is being made.

Nothing in this subsection shall be construed to require refunding any repayment of a loan.
At the option of the lender, the amount of such adjustment may be distributed to the borrower either by reduction in the amount of the periodic payment on the loan, by reducing the number of payments that shall be made with respect to the loan, or by reducing the amount of the final payment of the loan.

Nothing in this paragraph shall be construed to require the lender to make additional disclosures pursuant to section 433(b).
(6) PUBLICATION OF TREASURY BILL RATE.—For the purpose of enabling holders of loans to make the determinations and adjustments provided for in this subsection, the Secretary shall for each calendar quarter commencing with the quarter begin- ning on July 1, 1987, publish a notice of the average of the bond equivalent rates of 91-day Treasury bills auctioned for such quarter.

Such notice shall be published not later than 7 days after the end of the quarter to which the notice relates.
(7) CONVERSION TO VARIABLE RATE.—(A) Subject to sub- paragraphs (C) and (D), a lender or holder shall convert the in- terest rate on a loan that is made pursuant to this part and is subject to the provisions of this subsection to a variable rate.
Such conversion shall occur not later than January 1, 1995, and, commencing on the date of conversion, the applicable in- terest rate for each 12-month period beginning on July 1 and ending on June 30 shall be determined by the Secretary on the June 1 preceding each such 12-month period and be equal to the sum of (i) the bond equivalent rate of the 91-day Treasury bills auctioned at the final auction prior to such June 1; and (ii) 3.25 percent in the case of loans described in paragraph (1), or 3.10 percent in the case of loans described in paragraph (3).
(B) In connection with the conversion specified in subpara- graph (A) for any period prior to such conversion, and subject to paragraphs (C) and (D), a lender or holder shall convert the interest rate to a variable rate on a loan that is made pursuant to this part and is subject to the provisions of this subsection to a variable rate.
The interest rates for such period shall be reset on a quarterly basis and the applicable interest rate for any quarter or portion thereof shall equal the sum of (i) the av- erage of the bond equivalent rates of 91-Treasury bills auc- tioned for the preceding 3-month period, and (ii) 3.25 percent in the case of loans described in paragraph (1) or 3.10 percent in the case of loans described in paragraph (3).
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427A vided to the borrower as specified in paragraph (5) for loans described in paragraph (1) or to the Government and borrower as specified in paragraph (3).

(C) A lender or holder of a loan being converted pursuant to this paragraph shall complete such conversion on or before January 1, 1995.

The lender or holder shall notify the borrower that the loan shall be converted to a variable interest rate and provide a description of the rate to the borrower not later than 30 days prior to the conversion.
The notice shall advise the borrower that such rate shall be calculated in accordance with the procedures set forth in this paragraph and shall provide the borrower with a substantially equivalent benefit as the ad- justment otherwise provided for under this subsection.

Such notice may be incorporated into the disclosure required under section 433(b) if such disclosure has not been previously made.
(D) The interest rate on a loan converted to a variable rate pursuant to this paragraph shall not exceed the maximum in- terest rate applicable to the loan prior to such conversion.

(E) Loans on which the interest rate is converted in ac- cordance with subparagraph (A) or (B) shall not be subject to any other provisions of this subsection.
(j) INTEREST RATES FOR NEW LOANS BETWEEN JULY 1, 1998 AND OCTOBER 1, 1998.— (1) IN GENERAL.—Notwithstanding subsection (h), but sub- ject to paragraph (2), with respect to any loan made, insured, or guaranteed under this part (other than a loan made pursu- ant to section 428B or 428C) for which the first disbursement is made on or after July 1, 1998, and before October 1, 1998, the applicable rate of interest shall, during any 12-month pe- riod beginning on July 1 and ending on June 30, be determined on the preceding June 1 and be equal to— (A) the bond equivalent rate of 91-day Treasury bills auctioned at the final auction held prior to such June 1; plus (B) 2.3 percent, except that such rate shall not exceed 8.25 percent.
(2) IN SCHOOL AND GRACE PERIOD RULES.—Notwith- standing subsection (h), with respect to any loan under this part (other than a loan made pursuant to section 428B or 428C) for which the first disbursement is made on or after July 1, 1998, and before October 1, 1998, the applicable rate of in- terest for interest which accrues— (A) prior to the beginning of the repayment period of the loan; or (B) during the period in which principal need not be paid (whether or not such principal is in fact paid) by rea- son of a provision described in section 428(b)(1)(M) or 427(a)(2)(C), shall be determined under paragraph (1) by substituting ‘‘1.7 percent’’ for ‘‘2.3 percent’’.
(3) PLUS LOANS.—Notwithstanding subsection (h), with re- spect to any loan under section 428B for which the first dis- bursement is made on or after July 1, 1998, and before October 1, 1998, the applicable rate of interest shall, during any 12- September 8, 2023 As Amended Through P.L.

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427A HIGHER EDUCATION ACT OF 1965 304 month period beginning on July 1 and ending on June 30, be determined on the preceding June 1 and be equal to the lesser of— (A)(i) the bond equivalent rate of 91-day Treasury bills auctioned at the final auction held prior to such June 1; plus (ii) 3.1 percent; or (B) 9.0 percent.
(4) CONSULTATION.—The Secretary shall determine the ap- plicable rate of interest under this subsection after consulta- tion with the Secretary of the Treasury and shall publish such rate in the Federal Register as soon as practicable after the date of determination.
(k) INTEREST RATES FOR NEW LOANS ON OR AFTER OCTOBER 1, 1998, AND BEFORE JULY 1, 2006.— (1) IN GENERAL.—Notwithstanding subsection (h) and sub- ject to paragraph (2) of this subsection, with respect to any loan made, insured, or guaranteed under this part (other than a loan made pursuant to section 428B or 428C) for which the first disbursement is made on or after October 1, 1998, and be- fore July 1, 2006, the applicable rate of interest shall, during any 12-month period beginning on July 1 and ending on June 30, be determined on the preceding June 1 and be equal to— (A) the bond equivalent rate of 91-day Treasury bills auctioned at the final auction held prior to such June 1; plus (B) 2.3 percent, except that such rate shall not exceed 8.25 percent.
(2) IN SCHOOL AND GRACE PERIOD RULES.—Notwith- standing subsection (h), with respect to any loan under this part (other than a loan made pursuant to section 428B or 428C) for which the first disbursement is made on or after Oc- tober 1, 1998, and before July 1, 2006, the applicable rate of interest for interest which accrues— (A) prior to the beginning of the repayment period of the loan; or (B) during the period in which principal need not be paid (whether or not such principal is in fact paid) by rea- son of a provision described in section 427(a)(2)(C) or 428(b)(1)(M), shall be determined under paragraph (1) by substituting ‘‘1.7 percent’’ for ‘‘2.3 percent’’.
(3) PLUS LOANS.—Notwithstanding subsection (h), with re- spect to any loan under section 428B for which the first dis- bursement is made on or after October 1, 1998, and before July 1, 2006, the applicable rate of interest shall be determined under paragraph (1)— (A) by substituting ‘‘3.1 percent’’ for ‘‘2.3 percent’’; and (B) by substituting ‘‘9.0 percent’’ for ‘‘8.25 percent’’.
(4) CONSOLIDATION LOANS.—With respect to any consolida- tion loan under section 428C for which the application is re- ceived by an eligible lender on or after October 1, 1998, and before July 1, 2006, the applicable rate of interest shall be at September 8, 2023 As Amended Through P.L.
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427A an annual rate on the unpaid principal balance of the loan that is equal to the lesser of— (A) the weighted average of the interest rates on the loans consolidated, rounded to the nearest higher one- eighth of 1 percent; or (B) 8.25 percent.
(5) CONSULTATION.—The Secretary shall determine the ap- plicable rate of interest under this subsection after consulta- tion with the Secretary of the Treasury and shall publish such rate in the Federal Register as soon as practicable after the date of determination.
(l) INTEREST RATES FOR NEW LOANS ON OR AFTER JULY 1, 2006 and Before July 1, 2010.— (1) IN GENERAL.—Notwithstanding subsection (h), with re- spect to any loan made, insured, or guaranteed under this part (other than a loan made pursuant to section 428B or 428C) for which the first disbursement is made on or after July 1, 2006, and before July 1, 2010, the applicable rate of interest shall be 6.8 percent on the unpaid principal balance of the loan.
(2) PLUS LOANS.—Notwithstanding subsection (h), with re- spect to any loan under section 428B for which the first dis- bursement is made on or after July 1, 2006, and before July 1, 2010, the applicable rate of interest shall be 8.5 percent on the unpaid principal balance of the loan.
(3) CONSOLIDATION LOANS.—With respect to any consolida- tion loan under section 428C for which the application is re- ceived by an eligible lender on or after July 1, 2006, and that was disbursed before July 1, 2010, the applicable rate of inter- est shall be at an annual rate on the unpaid principal balance of the loan that is equal to the lesser of— (A) the weighted average of the interest rates on the loans consolidated, rounded to the nearest higher one- eighth of 1 percent; or (B) 8.25 percent.
(4) REDUCED RATES FOR UNDERGRADUATE SUBSIDIZED LOANS.—Notwithstanding subsection (h) and paragraph (1) of this subsection, with respect to any loan to an undergraduate student made, insured, or guaranteed under this part (other than a loan made pursuant to section 428B, 428C, or 428H) for which the first disbursement is made on or after July 1, 2006, and before July 1, 2010, the applicable rate of interest shall be as follows: (A) For a loan for which the first disbursement is made on or after July 1, 2006, and before July 1, 2008, 6.8 percent on the unpaid principal balance of the loan.
(B) For a loan for which the first disbursement is made on or after July 1, 2008, and before July 1, 2009, 6.0 percent on the unpaid principal balance of the loan.

(C) For a loan for which the first disbursement is made on or after July 1, 2009, and before July 1, 2010, 5.6 percent on the unpaid principal balance of the loan.

(m) LESSER RATES PERMITTED.—Nothing in this section or sec- tion 428C shall be construed to prohibit a lender from charging a September 8, 2023 As Amended Through P.L.
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428 HIGHER EDUCATION ACT OF 1965 306 borrower interest at a rate less than the rate which is applicable under this part.
(n) DEFINITIONS.—For the purpose of subsections (a) and (d) of this section— (1) the term ‘‘period of instruction’’ shall, at the discretion of the lender, be any academic year, semester, trimester, quar- ter, or other academic period; or shall be the period for which the loan is made as determined by the institution of higher education; and (2) the term ‘‘period of enrollment’’ shall be the period for which the loan is made as determined by the institution of higher education and shall coincide with academic terms such as academic year, semester, trimester, quarter, or other aca- demic period as defined by such institution.
SEC.

428. ø20 U.S.C.

1078¿ FEDERAL PAYMENTS TO REDUCE STUDENT INTEREST COSTS.
(a) FEDERAL INTEREST SUBSIDIES.— (1) TYPES OF LOANS THAT QUALIFY.—Each student who has received a loan for study at an eligible institution for which the first disbursement is made before July 1, 2010, and— (A) which is insured by the Secretary under this part; or (B) which is insured under a program of a State or of a nonprofit private institution or organization which was contracted for, and paid to the student, within the period specified in paragraph (5), and which— (i) in the case of a loan insured prior to July 1, 1967, was made by an eligible lender and is insured under a program which meets the requirements of subparagraph (E) of subsection (b)(1) and provides that repayment of such loan shall be in installments beginning not earlier than 60 days after the student ceases to pursue a course of study (as described in subparagraph (D) of subsection (b)(1)) at an eligible in- stitution, or (ii) in the case of a loan insured after June 30, 1967, was made by an eligible lender and is insured under a program covered by an agreement made pur- suant to subsection (b), shall be entitled to have paid on his or her behalf and for his or her account to the holder of the loan a portion of the inter- est on such loan under circumstances described in paragraph (2).
(2) ADDITIONAL REQUIREMENTS TO RECEIVE SUBSIDY.—(A) Each student qualifying for a portion of an interest payment under paragraph (1) shall— (i) have provided to the lender a statement from the eligible institution, at which the student has been accepted for enrollment, or at which the student is in attendance, which— (I) sets forth the loan amount for which the stu- dent shows financial need; and September 8, 2023 As Amended Through P.L.
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428 (II) sets forth a schedule for disbursement of the proceeds of the loan in installments, consistent with the requirements of section 428G; (ii) meet the requirements of subparagraph (B); and (iii) 16 have provided to the lender at the time of application for a loan made, insured, or guaranteed under this part, the student’s driver’s number, if any.
(B) For the purpose of clause (ii) of subparagraph (A), a student shall qualify for a portion of an interest payment under paragraph (1) if the eligible institution has determined and documented the student’s amount of need for a loan based on the student’s estimated cost of attendance, estimated finan- cial assistance, and, for the purpose of an interest payment pursuant to this section, expected family contribution 17 (as de- termined under part F), subject to the provisions of subpara- graph (D).
(C) For the purpose of this paragraph— (i) a student’s cost of attendance shall be determined under section 472; (ii) a student’s estimated financial assistance means, for the period for which the loan is sought— (I) the amount of assistance such student will re- ceive under subpart 1 of part A (as determined in ac- cordance with section 484(b)), subpart 3 of part A, and parts C and E; plus (II) other scholarship, grant, or loan assistance, but excluding— (aa) any national service education award or post-service benefit under title I of the National and Community Service Act of 1990; and (bb) any veterans’ education benefits as de- fined in section 480(c); and (iii) the determination of need and of the amount of a loan by an eligible institution under subparagraph (B) with respect to a student shall be calculated in accordance with part F. (D) An eligible institution may not, in carrying out the pro- visions of subparagraphs (A) and (B) of this paragraph, provide a statement which certifies the eligibility of any student to re- ceive any loan under this part in excess of the maximum amount applicable to such loan.
(E) For the purpose of subparagraphs (B) and (C) of this paragraph, any loan obtained by a student under section 428A or 428H or a parent under section 428B of this Act or under any State-sponsored or private loan program for an academic year for which the determination is made may be used to offset the expected family contribution 1 of the student for that year.
(3) AMOUNT OF INTEREST SUBSIDY.—(A)(i) Subject to sec- tion 438(c), the portion of the interest on a loan which a stu- dent is entitled to have paid, on behalf of and for the account 16 Margin so in law.

Margin should be 2 ems to the left.

17 Effective on July 1, 2024, section 704(5) of division FF of Public Law 116–260 provides for an amendment to subparagraph (B) by striking ‘‘expected family contribution’’ and inserting ‘‘student aid index’’.

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428 HIGHER EDUCATION ACT OF 1965 308 of the student, to the holder of the loan pursuant to paragraph (1) of this subsection shall be equal to the total amount of the interest on the unpaid principal amount of the loan— (I) 18 which accrues prior to the date the stu- dent ceases to carry at least one-half the normal full-time academic workload (as determined by the institution), or (II) which accrues during a period in which principal need not be paid (whether or not such principal is in fact paid) by reason of a provision described in subsection (b)(1)(M) of this section or in section 427(a)(2)(C).
(ii) Such portion of the interest on a loan shall not exceed, for any period, the amount of the interest on that loan which is payable by the student after taking into consideration the amount of any interest on that loan which the student is enti- tled to have paid on his or her behalf for that period under any State or private loan insurance program.
(iii) The holder of a loan with respect to which payments are required to be made under this section shall be deemed to have a contractual right, as against the United States, to re- ceive from the Secretary the portion of interest which has been so determined without administrative delay after the receipt by the Secretary of an accurate and complete request for pay- ment pursuant to paragraph (4).
(iv) The Secretary shall pay this portion of the interest to the holder of the loan on behalf of and for the account of the borrower at such times as may be specified in regulations in force when the applicable agreement entered into pursuant to subsection (b) was made, or, if the loan was made by a State or is insured under a program which is not covered by such an agreement, at such times as may be specified in regulations in force at the time the loan was paid to the student.
(v) A lender may not receive interest on a loan for any pe- riod that precedes the date that is— (I) in the case of a loan disbursed by check, 10 days before the first disbursement of the loan; (II) in the case of a loan disbursed by electronic funds transfer, 3 days before the first disbursement of the loan; or (III) in the case of a loan disbursed through an escrow agent, 3 days before the first disbursement of the loan.
(B) If— (i) a State student loan insurance program is covered by an agreement under subsection (b), (ii) a statute of such State limits the interest rate on loans insured by such program to a rate which is less than the applicable interest rate under this part, and 18 Subclause (I) of section 428(a)(3)(A)(i) was amended ‘‘to read as follows:’’ by section 309(d)(1) of division F of Public Law 112–74, which has been carried out above.
Paragraph (2) of such section 309(d) reads: ‘‘The amendment made by paragraph (1) shall apply to new Federal Direct Stafford Loans made on or after July 1, 2012 and before July 1, 2014’’.

For loans made before July 1, 2012, the applicable provision of law is as follows: ‘‘(I) which accrues prior to the beginning of the repayment period of the loan, or’’ Margin of new subclause (I) (as added by such Public Law is so in law.

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428 (iii) the Secretary determines that subsection (d) does not make such statutory limitation inapplicable and that such statutory limitation threatens to impede the carrying out of the purpose of this part, then the Secretary may pay an administrative cost allowance to the holder of each loan which is insured under such program and which is made during the period beginning on the 60th day after the date of enactment of the Higher Education Amendments of 1968 and ending 120 days after the adjourn- ment of such State’s first regular legislative session which ad- journs after January 1, 1969.
Such administrative cost allow- ance shall be paid over the term of the loan in an amount per year (determined by the Secretary) which shall not exceed 1 percent of the unpaid principal balance of the loan.
(4) SUBMISSION OF STATEMENTS BY HOLDERS ON AMOUNT OF PAYMENT.—Each holder of a loan with respect to which pay- ments of interest are required to be made by the Secretary shall submit to the Secretary, at such time or times and in such manner as the Secretary may prescribe, statements con- taining such information as may be required by or pursuant to regulation for the purpose of enabling the Secretary to deter- mine the amount of the payment which he must make with re- spect to that loan.
(5) DURATION OF AUTHORITY TO MAKE INTEREST SUBSIDIZED LOANS.—The period referred to in subparagraph (B) of para- graph (1) of this subsection shall begin on the date of enact- ment of this Act and end at the close of June 30, 2010.
(6) ASSESSMENT OF BORROWER’S FINANCIAL CONDITION NOT PROHIBITED OR REQUIRED.—Nothing in this or any other Act shall be construed to prohibit or require, unless otherwise spe- cifically provided by law, a lender to evaluate the total finan- cial situation of a student making application for a loan under this part, or to counsel a student with respect to any such loan, or to make a decision based on such evaluation and counseling with respect to the dollar amount of any such loan.
(7) LOANS THAT HAVE NOT BEEN CONSUMMATED.—Lenders may not charge interest or receive interest subsidies or special allowance payments for loans for which the disbursement checks have not been cashed or for which electronic funds transfers have not been completed.
(b) INSURANCE PROGRAM AGREEMENTS TO QUALIFY LOANS FOR INTEREST SUBSIDIES.— (1) REQUIREMENTS OF INSURANCE PROGRAM.—Any State or any nonprofit private institution or organization may enter into an agreement with the Secretary for the purpose of enti- tling students who receive loans which are insured under a student loan insurance program of that State, institution, or organization to have made on their behalf the payments pro- vided for in subsection (a) if the Secretary determines that the student loan insurance program— (A) authorizes the insurance in any academic year, as defined in section 481(a)(2), or its equivalent (as deter- mined under regulations of the Secretary) for any student who is carrying at an eligible institution or in a program September 8, 2023 As Amended Through P.L.
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428 HIGHER EDUCATION ACT OF 1965 310 of study abroad approved for credit by the eligible home in- stitution at which such student is enrolled at least one-half the normal full-time academic workload (as determined by the institution) in any amount up to a maximum of— (i) in the case of a student at an eligible institu- tion who has not successfully completed the first year of a program of undergraduate education— (I) $3,500, if such student is enrolled in a pro- gram whose length is at least one academic year in length; and (II) if such student is enrolled in a program of undergraduate education which is less than 1 aca- demic year, the maximum annual loan amount that such student may receive may not exceed the amount that bears the same ratio to the amount specified in subclause (I) as the length of such pro- gram measured in semester, trimester, quarter, or clock hours bears to 1 academic year; (ii) in the case of a student at an eligible institu- tion who has successfully completed such first year but has not successfully completed the remainder of a program of undergraduate education— (I) $4,500; or (II) if such student is enrolled in a program of undergraduate education, the remainder of which is less than one academic year, the maximum an- nual loan amount that such student may receive may not exceed the amount that bears the same ratio to the amount specified in subclause (I) as such remainder measured in semester, trimester, quarter, or clock hours bears to one academic year; (iii) in the case of a student at an eligible institu- tion who has successfully completed the first and sec- ond years of a program of undergraduate education but has not successfully completed the remainder of such program— (I) $5,500; or (II) if such student is enrolled in a program of undergraduate education, the remainder of which is less than one academic year, the maximum an- nual loan amount that such student may receive may not exceed the amount that bears the same ratio to the amount specified in subclause (I) as such remainder measured in semester, trimester, quarter, or clock hours bears to one academic year; (iv) in the case of a student who has received an associate or baccalaureate degree and is enrolled in an eligible program for which the institution requires such degree for admission, the number of years that a student has completed in a program of undergraduate education shall, for the purposes of clauses (ii) and (iii), include any prior enrollment in the eligible pro- September 8, 2023 As Amended Through P.L.
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428 gram of undergraduate education for which the stu- dent was awarded such degree; (v) in the case of a graduate or professional stu- dent (as defined in regulations of the Secretary) at an eligible institution, $8,500; and (vi) in the case of a student enrolled in coursework specified in sections 484(b)(3)(B) and 484(b)(4)(B)— (I) $2,625 for coursework necessary for enroll- ment in an undergraduate degree or certificate program, and, in the case of a student who has ob- tained a baccalaureate degree, $5,500 for coursework necessary for enrollment in a graduate or professional degree or certification program; and (II) in the case of a student who has obtained a baccalaureate degree, $5,500 for coursework nec- essary for a professional credential or certification from a State required for employment as a teacher in an elementary school or secondary school; except in cases where the Secretary determines, pursuant to regulations, that a higher amount is warranted in order to carry out the purpose of this part with respect to stu- dents engaged in specialized training requiring exception- ally high costs of education, but the annual insurable limit per student shall not be deemed to be exceeded by a line of credit under which actual payments by the lender to the borrower will not be made in any years in excess of the an- nual limit; (B) provides that the aggregate insured unpaid prin- cipal amount for all such insured loans made to any stu- dent shall be any amount up to a maximum of— (i) $23,000, in the case of any student who has not successfully completed a program of undergraduate education, excluding loans made under section 428A or 428B; and (ii) $65,500, in the case of any graduate or profes- sional student (as defined by regulations of the Sec- retary), and (I) including any loans which are insured by the Secretary under this section, or by a guaranty agency, made to such student before the student be- came a graduate or professional student, but (II) ex- cluding loans made under section 428A or 428B,
 except that the Secretary may increase the limit applicable to students who are pursuing programs which the Sec- retary determines are exceptionally expensive; (C) authorizes the insurance of loans to any individual student for at least 6 academic years of study or their equivalent (as determined under regulations of the Sec- retary); (D) provides that (i) the student borrower shall be en- titled to accelerate without penalty the whole or any part of an insured loan, (ii) the student borrower may annually change the selection of a repayment plan under this part, and (iii) the note, or other written evidence of any loan, September 8, 2023 As Amended Through P.L.
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428 HIGHER EDUCATION ACT OF 1965 312 may contain such reasonable provisions relating to repay- ment in the event of default by the borrower as may be au- thorized by regulations of the Secretary in effect at the time such note or written evidence was executed, and shall contain a notice that repayment may, following a default by the borrower, be subject to income contingent repay- ment in accordance with subsection (m); (E) subject to subparagraphs (D) and (L), and except as provided by subparagraph (M), provides that— (i) not more than 6 months prior to the date on which the borrower’s first payment is due, the lender shall offer the borrower of a loan made, insured, or guaranteed under this section or section 428H, the op- tion of repaying the loan in accordance with a stand- ard, graduated, income-sensitive, or extended repay- ment schedule (as described in paragraph (9)) estab- lished by the lender in accordance with regulations of the Secretary; and (ii) repayment of loans shall be in installments in accordance with the repayment plan selected under paragraph (9) and commencing at the beginning of the repayment period determined under paragraph (7); (F) authorizes interest on the unpaid balance of the loan at a yearly rate not in excess (exclusive of any pre- mium for insurance which may be passed on to the bor- rower) of the rate required by section 427A; (G) insures 98 percent of the unpaid principal of loans insured under the program, except that— (i) such program shall insure 100 percent of the unpaid principal of loans made with funds advanced pursuant to section 428(j); (ii) for any loan for which the first disbursement of principal is made on or after July 1, 2006, and be- fore July 1, 2010, the preceding provisions of this sub- paragraph shall be applied by substituting ‘‘97 per- cent’’ for ‘‘98 percent’’; and (iii) notwithstanding the preceding provisions of this subparagraph, such program shall insure 100 per- cent of the unpaid principal amount of exempt claims as defined in subsection (c)(1)(G);
 (H) provides— (i) for loans for which the date of guarantee of principal is before July 1, 2006, for the collection of a single insurance premium equal to not more than 1.0 percent of the principal amount of the loan, by deduc- tion proportionately from each installment payment of the proceeds of the loan to the borrower, and ensures that the proceeds of the premium will not be used for incentive payments to lenders; or (ii) for loans for which the date of guarantee of principal is on or after July 1, 2006, and that are first disbursed before July 1, 2010, for the collection, and the deposit into the Federal Student Loan Reserve Fund under section 422A of a Federal default fee of an September 8, 2023 As Amended Through P.L.
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428 amount equal to 1.0 percent of the principal amount of the loan, which fee shall be collected either by de- duction from the proceeds of the loan or by payment from other non-Federal sources, and ensures that the proceeds of the Federal default fee will not be used for incentive payments to lenders; (I) provides that the benefits of the loan insurance pro- gram will not be denied any student who is eligible for in- terest benefits under subsection (a) (1) and (2); (J) provides that a student may obtain insurance under the program for a loan for any year of study at an eligible institution; (K) in the case of a State program, provides that such State program is administered by a single State agency, or by one or more nonprofit private institutions or organiza- tions under supervision of a single State agency; (L) provides that the total of the payments by a bor- rower— (i) except as otherwise provided by a repayment plan selected by the borrower under clause (ii), (iii), or (v) of paragraph (9)(A), during any year of any repay- ment period with respect to the aggregate amount of all loans to that borrower which are insured under this part shall not, unless the borrower and the lender otherwise agree, be less than $600 or the balance of all such loans (together with interest thereon), whichever amount is less (but in no instance less than the amount of interest due and payable, notwithstanding any payment plan under paragraph (9)(A)); and (ii) for a monthly or other similar payment period with respect to the aggregate of all loans held by the lender may, when the amount of a monthly or other similar payment is not a multiple of $5, be rounded to the next highest whole dollar amount that is a mul- tiple of $5; (M) provides that periodic installments of principal need not be paid, but interest shall accrue and be paid by the Secretary, during any period— (i) during which the borrower— (I) is pursuing at least a half-time course of study as determined by an eligible institution, ex- cept that no borrower,
 notwithstanding the provi- sions of the promissory note, shall be required to borrow an additional loan under this title in order to be eligible to receive a deferment under this clause; or (II) is pursuing a course of study pursuant to a graduate fellowship program approved by the Secretary, or pursuant to a rehabilitation training program for disabled individuals approved by the Secretary, except that no borrower shall be eligible for a deferment under this clause, or loan made under this part (other than a loan made under section 428B or September 8, 2023 As Amended Through P.L.
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428 HIGHER EDUCATION ACT OF 1965 314 428C), while serving in a medical internship or resi- dency program; (ii) not in excess of 3 years during which the bor- rower is seeking and unable to find full-time employ- ment, except that no borrower who provides evidence of eligibility for unemployment benefits shall be re- quired for a to provide additional paperwork deferment under this clause; (iii) during which the borrower— (I) is serving on active duty during a war or other military operation or national emergency; or (II) is performing qualifying National Guard duty during a war or other military operation or national emergency, and for the 180-day period following the demobiliza- tion date for the service described in subclause (I) or (II); (iv) not in excess of 3 years for any reason which the lender determines, in accordance with regulations prescribed by the Secretary under section 435(o), has caused or will cause the borrower to have an economic hardship; or (v) during which the borrower is receiving treat- ment for cancer and the 6 months after such period; (N) provides that funds borrowed by a student— (i) are disbursed to the institution by check or other means that is payable to, and requires the en- dorsement or other certification by, such student; (ii) in the case of a student who is studying out- side the United States in a program of study abroad that is approved for credit by the home institution at which such student is enrolled, and only after verification of the student’s enrollment by the lender or guaranty agency, are, at the request of the student, disbursed directly to the student by the means de- scribed in clause (i), unless such student requests that the check be endorsed, or the funds transfer be au- thorized, pursuant to an authorized power-of-attorney; or (iii) in the case of a student who is studying out- side the United States in a program of study at an eli- gible foreign institution, are, at the request of the for- eign institution, disbursed directly to the student, only after verification of the student’s enrollment by the lender or guaranty agency by the means described in clause (i).
(O) provides that the proceeds of the loans will be dis- bursed in accordance with the requirements of section 428G; (P) requires the borrower to notify the institution con- cerning any change in local address during enrollment and requires the borrower and the institution at which the bor- rower is in attendance promptly to notify the holder of the loan, directly or through the guaranty agency, concerning September 8, 2023 As Amended Through P.L.
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428 (i) any change of permanent address, (ii) when the student ceases to be enrolled on at least a half-time basis, and (iii) any other change in status, when such change in status af- fects the student’s eligibility for the loan; (Q) provides for the guarantee of loans made to stu- dents and parents under sections 428A and 428B; (R) with respect to lenders which are eligible institu- tions, provides for the insurance of loans by only such in- stitutions as are located within the geographic area served by such guaranty agency; (S) provides no restrictions with respect to the insur- ance of loans for students who are otherwise eligible for loans under such program if such a student is accepted for enrollment in or is attending an eligible institution within the State, or if such a student is a legal resident of the State and is accepted for enrollment in or is attending an eligible institution outside that State; (T) authorizes (i) the limitation of the total number of loans or volume of loans, made under this part to students attending a particular eligible institution during any aca- demic year; and (ii) the emergency action, limitation, sus- pension, or termination of the eligibility of an eligible insti- tution if— (I) such institution is ineligible for the emergency action, limitation, suspension, or termination of eligi- ble institutions under regulations issued by the Sec- retary or is ineligible pursuant to criteria, rules, or regulations issued under the student loan insurance program which are substantially the same as regula- tions with respect to emergency action, limitation, sus- pension, or termination of such eligibility issued by the Secretary; (II) there is a State constitutional prohibition af- fecting the eligibility of such an institution; (III) such institution fails to make timely refunds to students as required by regulations issued by the Secretary or has not satisfied within 30 days of issuance a final judgment obtained by a student seek- ing such a refund; (IV) such institution or an
 owner, director, or offi- cer of such institution is found guilty in any criminal, civil, or administrative proceeding, or such institution or an owner, director, or officer of such institution is found liable in any civil or administrative proceeding, regarding the obtaining, maintenance, or disburse- ment of State or Federal grant, loan, or work assist- ance funds; or (V) such institution or an owner, director, or offi- cer of such institution has unpaid financial liabilities involving the improper acquisition, expenditure, or re- fund of State or Federal financial assistance funds; except that, if a guaranty agency limits, suspends, or ter- minates the participation of an eligible institution, the Sec- September 8, 2023 As Amended Through P.L.
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428 HIGHER EDUCATION ACT OF 1965 316 retary shall apply that limitation, suspension, or termi- nation to all locations of such institution, unless the Sec- retary finds, within 30 days of notification of the action by the guaranty agency, that the guaranty agency’s action did not comply with the requirements of this section; (U) provides (i) for the eligibility of all lenders de- scribed in section 435(d)(1) under reasonable criteria, un- less (I) that lender is eliminated as a lender under regula- tions for the emergency action, limitation, suspension, or termination of a lender under the Federal student loan in- surance program or is eliminated as a lender pursuant to criteria issued under the student loan insurance program which are substantially the same as regulations with re- spect to such eligibility as a lender issued under the Fed- eral student loan insurance program, or (II) there is a State constitutional prohibition affecting the eligibility of a lender, (ii) assurances that the guaranty agency will report to the Secretary concerning changes in such criteria, in- cluding any procedures in effect under such program to take emergency action, limit, suspend, or terminate lend- ers, and (iii) for (I) a compliance audit of each lender that originates or holds more than $5,000,000 in loans made under this title for any lender fiscal year (except that each lender described in section 435(d)(1)(A)(ii)(III) shall annu- ally submit the results of an audit required by this clause), at least once a year and covering the period since the most recent audit, conducted by a qualified, independent organi- zation or person in accordance with standards established by the Comptroller General for the audit of governmental organizations, programs, and functions, and as prescribed in regulations of the Secretary, the results of which shall be submitted to the Secretary, or (II) with regard to a lender that is audited under chapter 75 of title 31, United States Code, such audit shall be deemed to satisfy the re- quirements
 of subclause (I) for the period covered by such audit, except that the Secretary may waive the require- ments of this clause (iii) if the lender submits to the Sec- retary the results of an audit conducted for other purposes that the Secretary determines provides the same informa- tion as the audits required by this clause; (V) provides authority for the guaranty agency to re- quire a participation agreement between the guaranty agency and each eligible institution within the State in which it is designated, as a condition for guaranteeing loans made on behalf of students attending the institution; (W) provides assurances that the agency will imple- ment all requirements of the Secretary for uniform claims and procedures pursuant to section 432(l); (X) provides information to the Secretary in accord- ance with section 428(c)(9) and maintains reserve funds determined by the Secretary to be sufficient in relation to such agency’s guarantee obligations; and (Y) provides that— September 8, 2023 As Amended Through P.L.
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428 (i) the lender shall determine the eligibility of a borrower for a deferment described in subparagraph (M)(i) based on— (I) receipt of a request for deferment from the borrower and documentation of the borrower’s eli- gibility for the deferment; (II) receipt of a newly completed loan applica- tion that documents the borrower’s eligibility for a deferment; (III) receipt of student status information doc- umenting that the borrower is enrolled on at least a half-time basis; or (IV) the lender’s confirmation of the bor- rower’s half-time enrollment status through use of the National Student Loan Data System, if the confirmation is requested by the institution of higher education; (ii) the lender will notify the borrower of the granting of any deferment under clause (i)(II) or (III) of this subparagraph and of the option to continue paying on the loan; and (iii) the lender shall, at the time the lender grants a deferment to a borrower who received a loan under section 428H and is eligible for a deferment under subparagraph (M) of this paragraph, provide informa- tion to the borrower to assist the borrower in under- standing the impact of the capitalization of interest on the borrower’s loan principal and on the total amount of interest to be paid during the life of the loan.
(2) CONTENTS OF INSURANCE PROGRAM AGREEMENT.—Such an agreement shall— (A) provide that the holder of any such loan will be re- quired to submit to the Secretary, at such time or times and in such manner as the Secretary may prescribe, state- ments containing such information as may be required by or pursuant to regulation for the purpose of enabling the Secretary to determine the amount of the payment which must be made with respect to that loan; (B) include such other provisions as may be necessary to protect the United States from the risk of unreasonable loss and promote the purpose of this part, including such provisions as may be necessary for the purpose of section 437, and as are agreed to by the Secretary and the guar- anty agency, as the case may be; (C) provide for making such reports, in such form and containing such information, including financial informa- tion, as the Secretary may reasonably require to carry out the Secretary’s functions under this part and protect the fi- nancial interest of the United States, and for keeping such records and for affording such access thereto as the Sec- retary may find necessary to assure the correctness and verification of such reports; (D) provide for— September 8, 2023 As Amended Through P.L.
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428 HIGHER EDUCATION ACT OF 1965 318 (i) conducting, except as provided in clause (ii), fi- nancial and compliance audits of the guaranty agency on at least an annual basis and covering the period since the most recent audit, conducted by a qualified, independent organization or person in accordance with standards established by the Comptroller General for the audit of governmental organizations, programs, and functions, and as prescribed in regulations of the Secretary, the results of which shall be submitted to the Secretary; or (ii) with regard to a guaranty program of a State which is audited under chapter 75 of title 31, United States Code, deeming such audit to satisfy the require- ments of clause (i) for the period of time covered by such audit; (E)(i) provide that any guaranty agency may transfer loans which are insured under this part to any other guar- anty agency with the approval of the holder of the loan and such other guaranty agency; and (ii) provide that the lender (or the holder of the loan) shall, not later than 120 days after the borrower has left the eligible institution, notify the borrower of the date on which the repayment period begins; and (F) provide that, if the sale, other transfer, or assign- ment of a loan made under this part to another holder will result in a change in the identity of the party to whom the borrower must send subsequent payments or direct any communications concerning the loans, then— (i) the transferor and the transferee will be re- quired, not later than 45 days from the date the trans- feree acquires a legally enforceable right to receive payment from the borrower on such loan, either jointly or separately to provide a notice to the borrower of— (I) the sale or other transfer; (II) the identity of the transferee; (III) the name and address of the party to whom subsequent payments or communications must be sent; (IV) the telephone numbers of both the trans- feror and the transferee; (V) the effective date of the transfer; (VI) the date on which the current
 servicer (as of the date of the notice) will stop accepting pay- ments; and (VII) the date on which the new servicer will begin accepting payments; and (ii) the transferee will be required to notify the guaranty agency, and, upon the request of an institu- tion of higher education, the guaranty agency shall no- tify the last such institution the student attended prior to the beginning of the repayment period of any loan made under this part, of— (I) any sale or other transfer of the loan; and September 8, 2023 As Amended Through P.L.
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428 (II) the address and telephone number by which contact may be made with the new holder concerning repayment of the loan, except that this subparagraph (F) shall only apply if the borrower is in the grace period described in section 427(a)(2)(B) or 428(b)(7) or is in repayment status.
(3) RESTRICTIONS ON INDUCEMENTS, PAYMENTS, MAILINGS, AND ADVERTISING.—A guaranty agency shall not— (A) offer, directly or indirectly, premiums, payments, stock or other securities, prizes, travel, entertainment ex- penses, tuition payment or reimbursement, or other in- ducements to— (i) any institution of higher education, any em- ployee of an institution of higher education, or any in- dividual or entity in order to secure applicants for loans made under this part; or (ii) any lender, or any agent, employee, or inde- pendent contractor of any lender or guaranty agency, in order to administer or market loans made under this part (other than a loan made as part of the guar- anty agency’s lender-of-last-resort program pursuant to section 428(j)), for the purpose of securing the des- ignation of the guaranty agency as the insurer of such loans; (B) conduct unsolicited mailings, by postal or elec- tronic means, of student loan application forms to students enrolled in secondary schools or postsecondary educational institutions, or to the families of such students, except that applications may be mailed, by postal or electronic means, to students or borrowers who have previously received loans guaranteed under this part by the guaranty agency; (C) perform, for an institution of higher education par- ticipating in a program under this title, any function that such institution is required to perform under this title, ex- cept that the guaranty agency may perform functions on behalf of such institution in accordance with section 485(b) or 485(l); (D) pay, on behalf of an institution of higher edu- cation, another person to perform any function that such institution is required to perform under this title, except that the guaranty agency may perform functions on behalf of such institution in accordance with section 485(b) or 485(l); or (E) conduct fraudulent or misleading advertising con- cerning loan availability, terms, or conditions.
It shall not be a violation of this paragraph for a guaranty agency to provide technical assistance to institutions of higher education comparable to the technical assistance provided to institutions of higher education by the Department.
(4) SPECIAL RULE.—With respect to the graduate fellowship program referred to in paragraph (1)(M)(i)(II), the Secretary shall approve any course of study at a foreign university that is accepted for the completion of a recognized international fel- lowship program by the administrator of such a program.

Re- September 8, 2023 As Amended Through P.L.


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428 HIGHER EDUCATION ACT OF 1965 320 quests for deferment of repayment of loans under this part by students engaged in graduate or postgraduate fellowship-sup- ported study (such as pursuant to a Fulbright grant) outside the United States shall be approved until completion of the pe- riod of the fellowship.
(5) GUARANTY AGENCY INFORMATION TRANSFERS.—(A) Until such time as the Secretary has implemented section 485B and is able to provide to guaranty agencies the information re- quired by such section, any guaranty agency may request infor- mation regarding loans made after January 1, 1987, to stu- dents who are residents of the State for which the agency is the designated guarantor, from any other guaranty agency in- suring loans to such students.
(B) Upon a request pursuant to subparagraph (A), a guar- anty agency shall provide— (i) the name and the social security number of the bor- rower; and (ii) the amount borrowed and the cumulative amount borrowed.

(C) Any costs associated with fulfilling the request of a guaranty agency for information on students shall be paid by the guaranty agency requesting the information.
(6) STATE GUARANTY AGENCY INFORMATION REQUEST OF STATE LICENSING BOARDS.—Each guaranty agency is authorized to enter into agreements with each appropriate State licensing board under which the State licensing board, upon request, will furnish the guaranty agency with the address of a student borrower in any case in which the location of the student bor- rower is unknown or unavailable to the guaranty agency.
(7) REPAYMENT PERIOD.—(A) In the case of a loan made under section 427 or 428, the repayment period shall exclude any period of authorized deferment or forbearance and shall begin the day after 6 months after the date the student ceases to carry at least one-half the normal full-time academic work- load (as determined by the institution).
(B) In the case of a loan made under section 428H, the re- payment period shall exclude any period of authorized deferment or forbearance, and shall begin as described in sub- paragraph (A), but interest shall begin to accrue or be paid by the borrower on the day the loan is disbursed.
(C) In the case of a loan made under section 428B or 428C, the repayment period shall begin on the day the loan is dis- bursed, or, if the loan is disbursed in multiple installments, on the day of the last such disbursement, and shall exclude any period of authorized deferment or forbearance.
(D) There shall be excluded from the 6-month period that begins on the date on which a student ceases to carry at least one-half the normal full-time academic workload as described in subparagraph (A) any period not to exceed 3 years during which a borrower who is a member of a reserve component of the Armed Forces named in section 10101 of title 10, United States Code, is called or ordered to active duty for a period of more than 30 days (as defined in section 101(d)(2) of such title).
Such period of exclusion shall include the period nec- September 8, 2023 As Amended Through P.L.

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428 essary to resume enrollment at the borrower’s next available regular enrollment period.
(8) MEANS OF DISBURSEMENT OF LOAN PROCEEDS.—Nothing in this title shall be interpreted to prohibit the disbursement of loan proceeds by means other than by check or to allow the Secretary to require checks to be made co-payable to the insti- tution and the borrower.
(9) REPAYMENT PLANS.— (A) DESIGN AND SELECTION.—In accordance with regu- lations promulgated by the Secretary, the lender shall offer a borrower of a loan made under this part the plans described in this subparagraph for repayment of such loan, including principal and interest thereon.
No plan may re- quire a borrower to repay a loan in less than 5 years un- less the borrower, during the 6 months immediately pre- ceding the start of the repayment period, specifically re- quests that repayment be made over of a shorter period.
The borrower may choose from— (i) a standard repayment plan, with a fixed an- nual repayment amount paid over a fixed period of time, not to exceed 10 years; (ii) a graduated repayment plan paid over a fixed period of time, not to exceed 10 years; (iii) an income-sensitive repayment plan, with in- come-sensitive repayment amounts paid over a fixed period of time, not to exceed 10 years, except that the borrower’s scheduled payments shall not be less than the amount of interest due; (iv) for new borrowers on or after the date of en- actment of the Higher Education Amendments of 1998 who accumulate (after such date) outstanding loans under this part totaling more than $30,000, an ex- tended repayment plan, with a fixed annual or grad- uated repayment amount paid over an extended period of time, not to exceed 25 years, except that the bor- rower shall repay annually a minimum amount deter- mined in accordance with paragraph (1)(L)(i); and (v) beginning July 1, 2009, an income-based re- payment plan that enables a borrower who has a par- tial financial hardship to make a lower monthly pay- ment in accordance with section 493C, except that the plan described in this clause shall not be available to a borrower for a loan under section 428B made on be- half of a dependent student or for a consolidation loan under section 428C, if the proceeds of such loan were used to discharge the liability of a loan under section 428B made on behalf of a dependent student.
(B) LENDER SELECTION OF OPTION IF BORROWER DOES NOT SELECT.—If a borrower of a loan made under this part does not select a repayment plan described in subpara- graph (A), the lender shall provide the borrower with a re- payment plan described in subparagraph (A)(i).

(c) GUARANTY AGREEMENTS FOR REIMBURSING LOSSES.— September 8, 2023 As Amended Through P.L.
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428 HIGHER EDUCATION ACT OF 1965 322 (1) AUTHORITY TO ENTER INTO AGREEMENTS.—(A) The Sec- retary may enter into a guaranty agreement with any guar- anty agency, whereby the Secretary shall undertake to reim- burse it, under such terms and conditions as the Secretary may establish, with respect to losses (resulting from the de- fault of the student borrower) on the unpaid balance of the principal and accrued interest of any insured loan.
The guar- anty agency shall, be deemed to have a contractual right against the United States, during the life of such loan, to re- ceive reimbursement according to the provisions of this sub- section.

Upon receipt of an accurate and complete request by a guaranty agency for reimbursement with respect to such losses, the Secretary shall pay promptly and without adminis- trative delay.
Except as provided in subparagraph (B) of this paragraph and in paragraph (7), the amount to be paid a guar- anty agency as reimbursement under this subsection shall be equal to 100 percent 19 of the amount expended by it in dis- charge of its insurance obligation incurred under its loan in- surance program.

A guaranty agency shall file a claim for re- imbursement with respect to losses under this subsection with- in 30 days after the guaranty agency discharges its insurance obligation on the loan.
(B) Notwithstanding subparagraph (A)— (i) if, for any fiscal year, the amount of such reim- bursement payments by the Secretary under this sub- section exceeds 5 percent of the loans which are insured by such guaranty agency under such program and which were in repayment at the end of the preceding fiscal year, the amount to be paid as reimbursement under this subsection for such excess shall be equal to 85 20 percent of the amount of such excess; and (ii) if, for any fiscal year, the amount of such reim- bursement payments exceeds 9 percent of such loans, the amount to be paid as reimbursement under this subsection for such excess shall be equal to 75 20 percent of the amount of such excess.
(C) For the purpose of this subsection, the amount of loans of a guaranty agency which are in repayment shall be the original principal amount of loans made by a lender which are insured by such a guaranty agency reduced by— (i) the amount the insurer has been required to pay to discharge its insurance obligations under this part; (ii) the original principal amount of loans insured by it which have been fully repaid; and (iii) the original principal amount insured on those loans for which payment of the first installment of prin- cipal has not become due pursuant to subsection (b)(1)(E) 19 Section 311 of division H of Public 114–113 provides for an amendment to strike ‘‘95 per- cent’’ and insert ‘‘100 percent’’ in paragraph (1).
Paragraph (1) has several references to ‘‘95 per- cent’’.

Such amendment was carried out to the first occurrence of that phrase in order to reflect the probable intent of Congress.

20 The amendments made by section 417(c)(1) of P.L.

105–244, changing the reimbursement percentages, apply to loans for which the first disbursement is made on or after October 1, 1998.

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428 of this section or such first installment need not be paid pursuant to subsection (b)(1)(M) of this section.
(D) Notwithstanding any other provisions of this section, in the case of a loan made pursuant to a lender-of-last-resort program, the Secretary shall apply the provisions of— (i) the fourth sentence of subparagraph (A) by sub- stituting ‘‘100 percent’’ for ‘‘95 percent’’; (ii) subparagraph (B)(i) by substituting ‘‘100 percent’’ for ‘‘85 percent’’; and (iii) subparagraph (B)(ii) by substituting ‘‘100 percent’’ for ‘‘75 percent’’.
(E) 21 Notwithstanding any other provisions of this section, in the case of an outstanding loan transferred to a guaranty agency from another guaranty agency pursuant to a plan ap- proved by the Secretary in response to the insolvency of the latter such guarantee agency, the Secretary shall apply the provision of— (i) the fourth sentence of subparagraph (A) by sub- stituting ‘‘100 percent’’ for ‘‘95 percent’’; (ii) subparagraph (B)(i) by substituting ‘‘90 percent’’ for ‘‘85 percent’’; and (iii) subparagraph (B)(ii) by substituting ‘‘80 percent’’ for ‘‘75 percent’’.
(F)(i) Notwithstanding any other provisions of this section, in the case of exempt claims, the Secretary shall apply the pro- visions of— (I) the fourth sentence of subparagraph (A) by sub- stituting ‘‘100 percent’’ for ‘‘95 percent’’; (II) subparagraph (B)(i) by substituting ‘‘100 percent’’ for ‘‘85 percent’’; and (III) subparagraph (B)(ii) by substituting ‘‘100 percent’’ for ‘‘75 percent’’.
(ii) For purposes of clause (i) of this subparagraph, the term ‘‘exempt claims’’ means claims with respect to loans for which it is determined that the borrower (or the student on whose behalf a parent has borrowed), without the lender’s or the institution’s knowledge at the time the loan was made, pro- vided false or erroneous information or took actions that caused the borrower or the student to be ineligible for all or a portion of the loan or for interest benefits thereon.
(G) Notwithstanding any other provision of this section, the Secretary shall exclude a loan made pursuant to a lender- of-last-resort program when making reimbursement payment calculations under subparagraphs (B) and (C).
(2) CONTENTS OF GUARANTY AGREEMENTS.—The guaranty agreement— (A) shall set forth such administrative and fiscal pro- cedures as may be necessary to protect the United States from the risk of unreasonable loss thereunder, to ensure proper and efficient administration of the loan insurance program, and to assure that due diligence will be exercised in the collection of loans insured under the program, in- September 8, 2023 As Amended Through P.L.
117-286, Enacted December 27, 2022 21 See footnote to subparagraph (B) of this paragraph.

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428 HIGHER EDUCATION ACT OF 1965 324 cluding (i) a requirement that each beneficiary of insur- ance on the loan submit proof that the institution was con- tacted and other reasonable attempts were made to locate the borrower (when the location of the borrower is un- known) and proof that contact was made with the bor- rower (when the location is known) and (ii) requirements establishing procedures to preclude consolidation lending from being an excessive proportion of guaranty agency re- coveries on defaulted loans under this part; (B) shall provide for making such reports, in such form and containing such information, as the Secretary may reasonably require to carry out the Secretary’s functions under this subsection, and for keeping such records and for affording such access thereto as the Secretary may find necessary to assure the correctness and verification of such reports; (C) shall set forth adequate assurances that, with re- spect to so much of any loan insured under the loan insur- ance program as may be guaranteed by the Secretary pur- suant to this subsection, the undertaking of the Secretary under the guaranty agreement is acceptable in full satis- faction of State law or regulation requiring the mainte- nance of a reserve; (D) shall provide that if, after the Secretary has made payment under the guaranty agreement pursuant to para- graph (1) of this subsection with respect to any loan, any payments are made in discharge of the obligation incurred by the borrower with respect to such loan (including any payments of interest accruing on such loan after such pay- ment by the Secretary), there shall be paid over to the Sec- retary (for deposit in the fund established by section 431) such proportion of the amounts of such payments as is de- termined (in accordance with paragraph (6)(A)) to rep- resent his equitable share thereof, but (i) shall provide for subrogation of the United States to the rights of any insur- ance beneficiary only to the extent required for the pur- pose of paragraph (8); and (ii)
 except as the Secretary may otherwise by or pursuant to regulation provide, amounts so paid by a borrower on such a loan shall be first applied in reduction of principal owing on such loan; (E) shall set forth adequate assurance that an amount equal to each payment made under paragraph (1) will be promptly deposited in or credited to the accounts main- tained for the purpose of section 422(c); (F) set forth adequate assurances that the guaranty agency will not engage in any pattern or practice which re- sults in a denial of a borrower’s access to loans under this part because of the borrower’s race, sex, color, religion, na- tional origin, age, handicapped status, income, attendance at a particular eligible institution within the area served by the guaranty agency, length of the borrower’s edu- cational program, or the borrower’s academic year in school; September 8, 2023 As Amended Through P.L.
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428 (G) shall prohibit the Secretary from making any re- imbursement under this subsection to a guaranty agency when a default claim is based on an inability to locate the borrower, unless the guaranty agency, at the time of filing for reimbursement, certifies to the Secretary that diligent attempts, including contact with the institution, have been made to locate the borrower through the use of reasonable skip-tracing techniques in accordance with regulations pre- scribed by the Secretary; and (H) set forth assurances that— (i) upon the request of an eligible institution, the guaranty agency shall, subject to clauses (ii) and (iii), furnish to the institution information with respect to students (including the names and addresses of such students) who received loans made, insured, or guar- anteed under this part for attendance at the eligible institution and for whom default aversion assistance activities have been requested under subsection (l); (ii) the guaranty agency shall not require the pay- ment from the institution of any fee for such informa- tion; and (iii) the guaranty agency will require the institu- tion to use such information only to assist the institu- tion in reminding students of their obligation to repay student loans and shall prohibit the institution from disseminating the information for any other purpose.
(I) may include such other provisions as may be nec- essary to promote the purpose of this part.
(3) FORBEARANCE.—A guaranty agreement under this sub- section— (A) shall contain provisions providing that— (i) upon request, a lender shall grant a borrower forbearance, renewable at 12-month intervals, on terms agreed to by the parties to the loan with the ap- proval of the insurer and documented in accordance with paragraph (10), and otherwise consistent with the regulations of the Secretary, if the borrower— (I) is serving in a medical or dental internship or residency program, the successful completion of which is required to begin professional practice or service, or is serving in a medical or dental intern- ship or residency program leading to a degree or certificate awarded by an institution of higher education, a hospital, or a health care facility that offers postgraduate training, provided that if the borrower qualifies for a deferment under section 427(a)(2)(C)(vii) or subsection (b)(1)(M)(vii) of this section as in effect prior to the enactment of the Higher Education Amendments of 1992, or section 427(a)(2)(C) or subsection (b)(1)(M) of this section as amended by such amendments, the borrower has exhausted his or her eligibility for such deferment; September 8, 2023 As Amended Through P.L.
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428 HIGHER EDUCATION ACT OF 1965 326 (II) has a debt burden under this title that equals or exceeds 20 percent of income; (III) is serving in a national service position for which the borrower receives a national service educational award under the National and Com- munity Service Trust Act of 1993; or (IV) is eligible for interest payments to be made on such loan for service in the Armed Forces under section 2174 of title 10, United States Code, and, pursuant to that eligibility, the interest is being paid on such loan under subsection (o); (ii) the length of the forbearance granted by the (I) under clause (i)(I) shall equal the length of time remaining in the borrower’s medical or den- tal internship or residency program, if the bor- rower is not eligible to receive a deferment de- scribed in such clause, or such length of time re- maining in the program after the borrower has ex- hausted for such the borrower’s eligibility deferment; lender— (II) under clause (i)(II) or (IV) shall not exceed 3 years; or (III) under clause (i)(III) shall not exceed the period for which the borrower is serving in a posi- tion described in such clause; and (iii) no administrative or other fee may be charged in connection with the granting of a forbearance under clause (i), and no adverse information regarding a bor- rower may be reported to a consumer reporting agency solely because of the granting of such forbearance; (B) may, to the extent provided in regulations of the Secretary, contain provisions that permit such forbearance for the benefit of the student borrower as may be agreed upon by the parties to an insured loan and approved by the insurer; (C) shall contain provisions that specify that— (i) the form of forbearance granted by the lender pursuant to this paragraph, other than subparagraph (A)(i)(IV), shall be temporary cessation of payments, unless the borrower selects forbearance in the form of an extension of time for making payments, or smaller payments than were previously scheduled; (ii) the form of forbearance
 granted by the lender pursuant to subparagraph (A)(i)(IV) shall be the tem- porary cessation of all payments on the loan other than payments of interest on the loan that are made under subsection (o); (iii) the lender shall, at the time of granting a bor- rower forbearance, provide information to the bor- rower to assist the borrower in understanding the im- pact of capitalization of interest on the borrower’s loan principal and total amount of interest to be paid dur- ing the life of the loan; and September 8, 2023 As Amended Through P.L.
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428 (iv) the lender shall contact the borrower not less often than once every 180 days during the period of forbearance to inform the borrower of— (I) the amount of unpaid principal and the amount of interest that has accrued since the last statement of such amounts provided to the bor- rower by the lender; (II) the fact that interest will accrue on the loan for the period of forbearance; (III) the amount of interest that will be cap- italized, and the date on which capitalization will occur; (IV) the option of the borrower to pay the in- terest that has accrued before the interest is cap- italized; and (V) the borrower’s option to discontinue the forbearance at any time; and (D) shall contain provisions that specify that— (i) forbearance for a period not to exceed 60 days may be granted if the lender reasonably determines that such a suspension of collection activity is war- ranted following a borrower’s request for deferment, forbearance, a change in repayment plan, or a request to consolidate loans, in order to collect or process ap- propriate supporting documentation related to the re- quest, and (ii) during such period interest shall accrue but not be capitalized.
Guaranty agencies shall not be precluded from permitting the parties to such a loan from entering into a forbearance agree- ment solely because the loan is in default.

The Secretary shall permit lenders to exercise administrative forbearances that do not require the agreement of the borrower, under conditions authorized by the Secretary.
Such forbearances shall include (i) forbearances for borrowers who are delinquent at the time of the granting of an authorized period of deferment under sec- tion 428(b)(1)(M) or 427(a)(2)(C), and (ii) if the borrower is less than 60 days delinquent on such loans at the time of sale or transfer, forbearances for borrowers on loans which are sold or transferred.
(4) DEFINITIONS.—For the purpose of this subsection, the terms ‘‘insurance beneficiary’’ and ‘‘default’’ have the meanings assigned to them by section 435.
(5) APPLICABILITY TO EXISTING LOANS.—In the case of any guaranty agreement with a guaranty agency, the Secretary may, in accordance with the terms of this subsection, under- take to guarantee loans described in paragraph (1) which are insured by such guaranty agency and are outstanding on the date of execution of the guaranty agreement, but only with re- spect to defaults occurring after the execution of such guaranty agreement or, if later, after its effective date.
(6) SECRETARY’S EQUITABLE SHARE.—(A) For the purpose of paragraph (2)(D), the Secretary’s equitable share of payments made by the borrower shall be that portion of the payments re- September 8, 2023 As Amended Through P.L.

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428 HIGHER EDUCATION ACT OF 1965 328 maining after the guaranty agency with which the Secretary has an agreement under this subsection has deducted from such payments— (i) a percentage amount equal to the complement of the reinsurance percentage in effect when payment under the guaranty agreement was made with respect to the loan; and (ii) 22 an amount equal to 24 percent of such pay- ments for use in accordance with section 422B, except that— (I) beginning October 1, 2003 and ending Sep- tember 30, 2007, this clause shall be applied by substituting ‘‘23 percent’’ for ‘‘24 percent’’; and (II) beginning October 1, 2007, this clause shall be applied by substituting ‘‘16 percent’’ for ‘‘24 percent’’.
(B) A guaranty agency shall— (i) on or after October 1, 2006— (I) not charge the borrower collection costs in an amount in excess of 18.5 percent of the outstanding principal and interest of a defaulted loan that is paid off through consolidation by the borrower under this title; and (II) remit to the Secretary a portion of the collec- tion charge under subclause (I) equal to 8.5 percent of the outstanding principal and interest of such de- faulted loan; and (ii) on and after October 1, 2009, remit to the Sec- retary the entire amount charged under clause (i)(I) with respect to each defaulted loan that is paid off with excess consolidation proceeds.
(C) For purposes of subparagraph (B), the term ‘‘excess consolidation proceeds’’ means, with respect to any guaranty agency for any Federal fiscal year beginning on or after Octo- ber 1, 2009, the proceeds of consolidation of defaulted loans under this title that exceed 45 percent of the agency’s total col- lections on defaulted loans in such Federal fiscal year.
(7) NEW PROGRAMS ELIGIBLE FOR 100 PERCENT REINSUR- ANCE.—(A) Notwithstanding paragraph (1)(C), the amount to be paid a guaranty agency for any fiscal year— (i) which begins on or after October 1, 1977 and ends before October 1, 1991; and (ii) which is either the fiscal year in which such guar- anty agency begins to actively carry on a student loan in- surance program which is subject to a guaranty agreement under subsection (b) of this section, or is one of the 4 suc- ceeding fiscal years, shall be 100 percent of the amount expended by such guaranty agency in discharge of its insurance obligation insured under such program.
(B) Notwithstanding the provisions of paragraph (1)(C), the Secretary may pay a guaranty agency 100 percent of the September 8, 2023 As Amended Through P.L.

117-286, Enacted December 27, 2022 22 Margins of clause (ii) so in law.

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428 amount expended by such agency in discharge of such agency’s insurance obligation for any fiscal year which— (i) begins on or after October 1, 1991; and (ii) is the fiscal year in which such guaranty agency begins to actively carry on a student loan insurance pro- gram which is subject to a guaranty agreement under sub- section (b) or is one of the 4 succeeding fiscal years.
(C) The Secretary shall continuously monitor the oper- ations of those guaranty agencies to which the provisions of subparagraph (A) or (B) are applicable and revoke the applica- tion of such subparagraph to any such guaranty agency which the Secretary determines has not exercised reasonable pru- dence in the administration of such program.
(8) ASSIGNMENT TO PROTECT FEDERAL FISCAL INTEREST.—If the Secretary determines that the protection of the Federal fis- cal interest so requires, a guaranty agency shall assign to the Secretary any loan of which it is the holder and for which the Secretary has made a payment pursuant to paragraph (1) of this subsection.
(9) GUARANTY AGENCY RESERVE LEVEL.—(A) Each guaranty agency which has entered into an agreement with the Sec- retary pursuant to this subsection shall maintain in the agen- cy’s Federal Student Loan Reserve Fund established under sec- tion 422A a current minimum reserve level of at least 0.25 per- cent of the total attributable amount of all outstanding loans guaranteed by such agency.
For purposes of this paragraph, such total attributable amount does not include amounts of outstanding loans transferred to the guaranty agency from an- other guaranty agency pursuant to a plan of the Secretary in response to the insolvency of the latter such guaranty agency.

(B) The Secretary shall collect, on an annual basis, infor- mation from each guaranty agency having an agreement under this subsection to enable the Secretary to evaluate the finan- cial solvency of each such agency.
The information collected shall include the level of such agency’s current reserves, cash disbursements and accounts receivable.
(C) If (i) any guaranty agency falls below the required min- imum reserve level in any 2 consecutive years, (ii) any guar- anty agency’s Federal reimbursement payments are reduced to 85 percent pursuant to paragraph (1)(B)(i), or (iii) the Sec- retary determines that the administrative or financial condi- tion of a guaranty agency jeopardizes such agency’s continued ability to perform its responsibilities under its guaranty agree- ment, then the Secretary shall require the guaranty agency to submit and implement a management plan acceptable to the Secretary within 45 working days of any such event.
(D)(i) If the Secretary is not seeking to terminate the guar- anty agency’s agreement under subparagraph (E), or assuming the guaranty agency’s functions under subparagraph (F), a management plan described in subparagraph (C) shall include the means by which the guaranty agency will improve its fi- nancial and administrative condition to the required level within 18 months.

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428 HIGHER EDUCATION ACT OF 1965 330 (ii) If the Secretary is seeking to terminate the guaranty agency’s agreement under subparagraph (E), or assuming the guaranty agency’s functions under subparagraph (F), a man- agement plan described in subparagraph (C) shall include the means by which the Secretary and the guaranty agency shall work together to ensure the orderly termination of the oper- ations, and liquidation of the assets, of the guaranty agency.
(E) The Secretary may terminate a guaranty agency’s agreement in accordance with subparagraph (F) if— (i) a guaranty agency required to submit a manage- ment plan under this paragraph fails to submit a plan that is acceptable to the Secretary; (ii) the Secretary determines that a guaranty agency has failed to improve substantially its administrative and financial condition; (iii) the Secretary determines that the guaranty agen- cy is in danger of financial collapse; (iv) the Secretary determines that such action is nec- essary to protect the Federal fiscal interest; or (v) the Secretary determines that such action is nec- essary to ensure the continued availability of loans to stu- dent or parent borrowers.
(F) If a guaranty agency’s agreement under this subsection is terminated pursuant to subparagraph (E), then the Sec- retary shall assume responsibility for all functions of the guar- anty agency under the loan insurance program of such agency.
In performing such functions the Secretary is authorized to— (i) permit the transfer of guarantees to another guar- anty agency; (ii) revoke the reinsurance agreement of the guaranty agency at a specified date, so as to require the merger, consolidation, or termination of the guaranty agency; (iii) transfer guarantees to the Department of Edu- cation for the purpose of payment of such claims and proc- ess such claims using the claims standards of the guaranty agency, if such standards are determined by the Secretary to be in compliance with this Act; (iv) design and implement a plan to restore the guar- anty agency’s viability; (v) provide the guaranty agency with additional ad- vance funds in accordance with section 422(c)(7), with such restrictions on the use of such funds as is determined ap- propriate by the Secretary, in order to— (I) meet the immediate cash needs of the guaranty agency; (II) ensure the uninterrupted payment of claims; or (III) ensure that the guaranty agency will make loans as the lender-of-last-resort, in accordance with subsection (j); (vi) use all funds and assets of the guaranty agency to assist in the activities undertaken in accordance with this subparagraph and take appropriate action to require the return, to the guaranty agency or the Secretary, of any September 8, 2023 As Amended Through P.L.
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428 funds or assets provided by the guaranty agency, under contract or otherwise, to any person or organization; or (vii) take any other action the Secretary determines necessary to ensure the continued availability of loans made under this part to residents of the State or States in which the guaranty agency did business, the full honoring of all guarantees issued by the guaranty agency prior to the Secretary’s assumption of the functions of such agency, and the proper servicing of loans guaranteed by the guar- anty agency prior to the Secretary’s assumption of the functions of such agency, and to avoid disruption of the student loan program.
(G) Notwithstanding any other provision of Federal or State law, if the Secretary has terminated or is seeking to ter- minate a guaranty agency’s agreement under subparagraph (E), or has assumed a guaranty agency’s functions under sub- paragraph (F)— (i) no State court may issue any order affecting the Secretary’s actions with respect to such guaranty agency; (ii) any contract with respect to the administration of a guaranty agency’s reserve funds, or the administration of any assets purchased or acquired with the reserve funds of the guaranty agency, that is entered into or extended by the guaranty agency, or any other party on behalf of or with the concurrence of the guaranty agency, after the date of enactment of this subparagraph shall provide that the contract is terminable by the Secretary upon 30 days notice to the contracting parties if the Secretary deter- mines that such contract includes an impermissible trans- fer of the reserve funds or assets, or is otherwise incon- sistent with the terms or purposes of this section; and (iii) no provision of State law shall apply to the actions of the Secretary in terminating the operations of a guar- anty agency.
(H) Notwithstanding any other provision of law, the Sec- retary’s liability for any outstanding liabilities of a guaranty agency (other than outstanding student loan guarantees under this part), the functions of which the Secretary has assumed, shall not exceed the fair market value of the reserves of the guaranty agency, minus any necessary liquidation or other ad- ministrative costs.
(I) The Secretary shall not take any action under subpara- graph (E) or (F) without giving the guaranty agency notice and the opportunity for a hearing that, if commenced after Sep- tember 24, 1998, shall be on the record.

(J) Notwithstanding any other provision of law, the infor- mation transmitted to the Secretary pursuant to this para- graph shall be confidential and exempt from disclosure under section 552 of title 5, United States Code, relating to freedom of information, or any other Federal law.
(K) The Secretary, within 6 months after the end of each fiscal year, shall submit to the authorizing committees a report specifying the Secretary’s assessment of the fiscal soundness of the guaranty agency system.

September 8, 2023 As Amended Through P.L.

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428 HIGHER EDUCATION ACT OF 1965 332 (10) DOCUMENTATION OF FORBEARANCE AGREEMENTS.—For the purposes of paragraph (3), the terms of forbearance agreed to by the parties shall be documented by confirming the agree- ment of the borrower by notice to the borrower from the lend- er, and by recording the terms in the borrower’s file.

(d) USURY LAWS INAPPLICABLE.—No provision of any law of the United States (other than this Act and section 207 of the Servicemembers Civil Relief Act (50 U.S.C.

App.
527)) or of any State (other than a statute applicable principally to such State’s student loan insurance program) which limits the rate or amount of interest payable on loans shall apply to a loan— (1) which bears interest (exclusive of any premium for in- surance) on the unpaid principal balance at a rate not in ex- cess of the rate specified in this part; and (2) which is insured (i) by the United States under this part, or (ii) by a guaranty agency under a program covered by an agreement made pursuant to subsection (b) of this section.
(f) 23 PAYMENTS OF CERTAIN COSTS.— (1) PAYMENT FOR CERTAIN ACTIVITIES.— (A) IN GENERAL.—The Secretary— (i) for loans originated during fiscal years begin- ning on or after October 1, 1998, and before October 1, 2003, and in accordance with the provisions of this paragraph, shall, except as provided in subparagraph (C), pay to each guaranty agency, a loan processing and issuance fee equal to 0.65 percent of the total principal amount of the loans on which insurance was issued under this part during such fiscal year by such agency; and (ii) for loans originated on or after October 1, 2003, and first disbursed before July 1, 2010, and in accordance with the provisions of this paragraph, shall, except as provided in subparagraph (C), pay to each guaranty agency, a loan processing and issuance fee equal to 0.40 percent of the total principal amount of the loans on which insurance was issued under this part during such fiscal year by such agency.
(B) PAYMENT.—The payment required by subpara- graph (A) shall be paid on a quarterly basis.

The guaranty agency shall be deemed to have a contractual right against the United States to receive payments according to the provisions of this paragraph.

Payments shall be made promptly and without administrative delay to any guar- anty agency submitting an accurate and complete applica- tion under this subparagraph.
(C) REQUIREMENT FOR PAYMENT.—No payment may be made under this paragraph for loans for which the dis- bursement checks have not been cashed or for which elec- tronic funds transfers have not been completed.

(g) ACTION ON INSURANCE PROGRAM AND GUARANTY AGREE- MENTS.—If a nonprofit private institution or organization— September 8, 2023 As Amended Through P.L.

117-286, Enacted December 27, 2022 23 So in law.

Subsection (e) was repealed by section 422(h) of Public Law 110–315.
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428 (1) applies to enter into an agreement with the Secretary under subsections (b) and (c) with respect to a student loan in- surance program to be carried on in a State with which the Secretary does not have an agreement under subsection (b), and (2) as provided in the application, undertakes to meet the requirements of section 422(c)(6)(B) (i), (ii), and (iii), the Secretary shall consider and act upon such application within 180 days, and shall forthwith notify the authorizing committees of his actions.
(i) 24 MULTIPLE DISBURSEMENT OF LOANS.— (1) ESCROW ACCOUNTS ADMINISTERED BY ESCROW AGENT.— Any guaranty agency or eligible lender (hereafter in this sub- section referred to as the ‘‘escrow agent’’) may enter into an agreement with any other eligible lender that is not an eligible institution or an agency or instrumentality of the State (here- after in this subsection referred to as the ‘‘lender’’) for the pur- pose of authorizing disbursements of the proceeds of a loan to a student.
Such agreement shall provide that the lender will pay the proceeds of such loans into an escrow account to be ad- ministered by the escrow agent in accordance with the provi- sions of paragraph (2) of this subsection.
Such agreement may allow the lender to make payments into the escrow account in amounts that do not exceed the sum of the amounts required for disbursement of initial or subsequent installments to bor- rowers and to make such payments not more than 10 days prior to the date of the disbursement of such installment to such borrowers.

Such agreement shall require the lender to no- tify promptly the eligible institution when funds are escrowed under this subsection for a student at such institution.
(2) AUTHORITY OF ESCROW AGENT.—Each escrow agent en- tering into an agreement under paragraph (1) of this sub- section is authorized to— (A) make the disbursements in accordance with the note evidencing the loan; (B) commingle the proceeds of all loans paid to the es- crow agent pursuant to the escrow agreement entered into under such paragraph (1); (C) invest the proceeds of such loans in obligations of the Federal Government or obligations which are insured or guaranteed by the Federal Government; (D) retain interest or other earnings on such invest- ment; and (E) return to the lender undisbursed funds when the student ceases to carry at an eligible institution at least one-half of the normal full-time academic workload as de- termined by the institution.
(j) LENDERS-OF-LAST-RESORT.— (1) GENERAL REQUIREMENT.—In each State, the guaranty agency or an eligible lender in the State described in section 435(d)(1)(D) of this Act shall, before July 1, 2010, make loans directly, or through an agreement with an eligible lender or September 8, 2023 As Amended Through P.L.

117-286, Enacted December 27, 2022 24 So in law.

Subsection (h) was repealed by section 438(a)(2)(B) of Public Law 110–315.
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428 HIGHER EDUCATION ACT OF 1965 334 lenders, to eligible students and parents who are otherwise un- able to obtain loans under this part (except for consolidation loans under section 428C) or who attend an institution of high- er education in the State that is designated under paragraph (4).
Loans made under this subsection shall not exceed the amount of the need of the borrower, as determined under sub- section (a)(2)(B), nor be less than $200.
No loan under section 428, 428B, or 428H that is made pursuant to this subsection shall be made with interest rates, origination or default fees, or other terms and conditions that are more favorable to the borrower than the maximum interest rates, origination or de- fault fees, or other terms and conditions applicable to that type of loan under this part.
The guaranty agency shall consider the request of any eligible lender, as defined under section 435(d)(1)(A) of this Act, to serve as the lender-of-last-resort pursuant to this subsection.
(2) RULES AND OPERATING PROCEDURES.—The guaranty agency shall develop rules and operating procedures for the lender-of-last-resort program designed to ensure that— (A) the program establishes operating hours and meth- ods of application designed to facilitate application by stu- dents and ensure a response within 60 days after the stu- dent’s original complete application is filed under this sub- section; (B) consistent with standards established by the Sec- retary, students applying for loans under this subsection shall not be subject to additional eligibility requirements or requests for additional information beyond what is re- quired under this title in order to receive a loan under this part from an eligible lender, nor, in the case of students and parents applying for loans under this subsection be- cause of an inability to otherwise obtain loans under this part (except for consolidation loans under section 428C), be required to receive more than two rejections from eligible lenders in order to obtain a loan under this subsection; (C) information about the availability of loans under the program is made available to institutions of higher education in the State; and (D) appropriate steps are taken to ensure that bor- rowers receiving loans under the program are appro- priately counseled on their loan obligation.
(3) ADVANCES TO GUARANTY AGENCIES FOR LENDER-OF- LAST-RESORT SERVICES.—(A) In order to ensure the availability of loan capital, the Secretary is authorized to provide a guar- anty agency designated for a State with additional advance funds in accordance with subparagraph (C) and section 422(c)(7), with such restrictions on the use of such funds as are determined appropriate by the Secretary, in order to ensure that the guaranty agency will make loans as the lender-of-last- resort.
Such agency shall make such loans in accordance with this subsection and the requirements of the Secretary.

(B) Notwithstanding any other provision in this part, a guaranty agency serving as a lender-of-last-resort under this paragraph shall be paid a fee, established by the Secretary, for September 8, 2023 As Amended Through P.L.
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428 making such loans in lieu of interest and special allowance subsidies, and shall be required to assign such loans to the Secretary on demand.
Upon such assignment, the portion of the advance represented by the loans assigned shall be consid- ered repaid by such guaranty agency.
(C) The Secretary shall exercise the authority described in subparagraph (A) only if the Secretary determines that eligible borrowers are seeking and are unable to obtain loans under this part or designates an institution of higher education for participation in the program under this subsection under para- graph (4), and that the guaranty agency designated for that State has the capability to provide lender-of-last-resort loans in a timely manner, in accordance with the guaranty agency’s ob- ligations under paragraph (1), but cannot do so without ad- vances provided by the Secretary under this paragraph.
If the Secretary makes the determinations described in the preceding sentence and determines that it would be cost-effective to do so, the Secretary may provide advances under this paragraph to such guaranty agency.
If the Secretary determines that such guaranty agency does not have such capability, or will not pro- vide such loans in a timely fashion, the Secretary may provide such advances to enable another guaranty agency, that the Secretary determines to have such capability, to make lender- of-last-resort loans to eligible borrowers in that State who are experiencing loan access problems or to eligible borrowers who attend an institution in the State that is designated under paragraph (4).
(4) INSTITUTION-WIDE STUDENT QUALIFICATION.—Upon the request of an institution of higher education and pursuant to standards developed by the Secretary, the Secretary shall des- ignate such institution for participation in the lender-of-last-re- sort program under this paragraph.
If the Secretary designates an institution under this paragraph, the guaranty agency des- ignated for the State in which the institution is located shall make loans, in the same manner as such loans are made under paragraph (1), to students and parent borrowers of the des- ignated institution, regardless of whether the students or par- ent borrowers are otherwise unable to obtain loans under this part (other than a consolidation loan under section 428C).
(5) STANDARDS DEVELOPED BY THE SECRETARY.—In devel- oping standards with respect to paragraph (4), the Secretary may require— (A) an institution of higher education to demonstrate that, despite due diligence on the part of the institution, the institution has been unable to secure the commitment of eligible lenders willing to make loans under this part to a significant number of students attending the institution; (B) that, prior to making a request under such para- graph for designation for participation in the lender-of- last-resort program, an institution of higher education shall demonstrate that the institution has met a minimum threshold, as determined by the Secretary, for the number or percentage of students at such institution who have re- September 8, 2023 As Amended Through P.L.
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428 HIGHER EDUCATION ACT OF 1965 336 ceived rejections from eligible lenders for loans under this part; and (C) any other standards and guidelines the Secretary determines to be appropriate.
(6) EXPIRATION OF AUTHORITY.—The Secretary’s authority under paragraph (4) to designate institutions of higher edu- cation for participation in the program under this subsection shall expire on June 30, 2010.

(7) EXPIRATION OF DESIGNATION.—The eligibility of an in- stitution of higher education, or borrowers from such institu- tion, to participate in the program under this subsection pursu- ant to a designation of the institution by the Secretary under paragraph (4) shall expire on June 30, 2010.
After such date, borrowers from an institution designated under paragraph (4) shall be eligible to participate in the program under this sub- section as such program existed on the day before the date of enactment of the Ensuring Continued Access to Student Loans Act of 2008.
(8) PROHIBITION ON INDUCEMENTS AND MARKETING.—Each guaranty agency or eligible lender that serves as a lender-of- last-resort under this subsection— (A) shall be subject to the prohibitions on inducements contained in subsection (b)(3) and the requirements of sec- tion 435(d)(5); and (B) shall not advertise, market, or otherwise promote loans under this subsection, except that nothing in this paragraph shall prohibit a guaranty agency from fulfilling its responsibilities under paragraph (2)(C).
(9) DISSEMINATION AND REPORTING.— (A) IN GENERAL.—The Secretary shall— (i) broadly disseminate information regarding the availability of loans made under this subsection; (ii) during the period beginning July 1, 2008 and ending June 30, 2011, provide to the authorizing com- mittees and make available to the public— (I) copies of any new or revised plans or agreements made by guaranty agencies or the De- partment related to the authorities under this subsection; (II) quarterly reports on— (aa) the number and amounts of loans originated or approved pursuant to this sub- section by each guaranty agency and eligible lender; and (bb) any related payments by the Depart- ment, a guaranty agency, or an eligible lend- er; and (III) a budget estimate of the costs to the Fed- eral Government (including subsidy and adminis- trative costs) for each 100 dollars loaned, of loans made pursuant to this subsection between the date of enactment of the Ensuring Continued Ac- cess to Student Loans Act of 2008 and June 30, 2010, disaggregated by type of loan, compared to September 8, 2023 As Amended Through P.L.
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428 such costs to the Federal Government during such time period of comparable loans under this part and part D, disaggregated by part and by type of loan; and (iii) beginning July 1, 2011, provide to the author- izing committees and make available to the public— (I) copies of any new or revised plans or agreements made by guaranty agencies or the De- partment related to the authorities under this subsection; and (II) annual reports on— (aa) the number and amounts of loans originated or approved pursuant to this sub- section by each guaranty agency and eligible lender; and (bb) any related payments by the Depart- ment, a guaranty agency, or an eligible lend- er.
(B) SEPARATE REPORTING.—The information required to be reported under subparagraph (A)(ii)(II) shall be re- ported separately for loans originated or approved pursu- ant to paragraph (4), or payments related to such loans, for the time period in which the Secretary is authorized to make designations under paragraph (4).
(k) INFORMATION ON DEFAULTS.— (1) PROVISION OF INFORMATION TO ELIGIBLE INSTITU- TIONS.—Notwithstanding any other provision of law, in order to notify eligible institutions of former students who are in de- fault of their continuing obligation to repay student loans, each guaranty agency shall, upon the request of an eligible institu- tion, furnish information with respect to students who were en- rolled at the eligible institution and who are in default on the repayment of any loan made, insured, or guaranteed under this part.
The information authorized to be furnished under this subsection shall include the names and addresses of such students.

(2) PUBLIC DISSEMINATION NOT AUTHORIZED.—Nothing in paragraph (1) of this subsection shall be construed to authorize public dissemination of the information described in paragraph (1).

(3) BORROWER LOCATION INFORMATION.—Any information provided by the institution relating to borrower location shall be used by the guaranty agency in conducting required skip- tracing activities.
(4) PROVISION OF INFORMATION TO BORROWERS IN DE- FAULT.—Each guaranty agency that has received a default claim from a lender regarding a borrower, shall provide the borrower in default, on not less than two separate occasions, with a notice, in simple and understandable terms, of not less than the following information: (A) The options available to the borrower to remove the borrower’s loan from default.

(B) The relevant fees and conditions associated with each option.
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428 HIGHER EDUCATION ACT OF 1965 338 (l) DEFAULT AVERSION ASSISTANCE.— (1) ASSISTANCE REQUIRED.—Upon receipt of a complete re- quest from a lender received not earlier than the 60th day of delinquency, a guaranty agency having an agreement with the Secretary under subsection (c) shall engage in default aversion activities designed to prevent the default by a borrower on a loan covered by such agreement.
(2) REIMBURSEMENT.— (A) IN GENERAL.—A guaranty agency, in accordance with the provisions of this paragraph, may transfer from the Federal Student Loan Reserve Fund under section 422A to the Agency Operating Fund under section 422B a default aversion fee.

Such fee shall be paid for any loan on which a claim for default has not been paid as a result of the loan being brought into current repayment status by the guaranty agency on or before the 300th day after the loan becomes 60 days delinquent.
(B) AMOUNT.—The default aversion fee shall be equal to 1 percent of the total unpaid principal and accrued in- terest on the loan at the time the request is submitted by the lender.

A guaranty agency may transfer such fees earned under this subsection not more frequently than monthly.
Such a fee shall not be paid more than once on any loan for which the guaranty agency averts the default unless— (i) at least 18 months has elapsed between the date the borrower entered current repayment status and the date the lender filed a subsequent default aversion assistance request; and (ii) during the period between such dates, the bor- rower was not more than 30 days past due on any payment of principal and interest on the loan.
(C) DEFINITION.—For the purpose of earning the de- fault aversion fee, the term ‘‘current repayment status’’ means that the borrower is not delinquent in the payment of any principal or interest on the loan.
(m) INCOME CONTINGENT AND INCOME-BASED REPAYMENT.— (1) AUTHORITY OF SECRETARY TO REQUIRE.—The Secretary may require borrowers who have defaulted on loans made under this part that are assigned to the Secretary under sub- section (c)(8) to repay those loans under an income contingent repayment plan or income-based repayment plan, the terms and conditions of which shall be established by the Secretary and the same as, or similar to, an income contingent repay- ment plan established for purposes of part D of this title or an income-based repayment plan under section 493C, as the case may be.
(2) LOANS FOR WHICH INCOME CONTINGENT OR INCOME- BASED REPAYMENT MAY BE REQUIRED.—A loan made under this part may be required to be repaid under this subsection if the note or other evidence of the loan has been assigned to the Sec- retary pursuant to subsection (c)(8).

(n) BLANKET CERTIFICATE OF LOAN GUARANTY.— September 8, 2023 As Amended Through P.L.
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428 (1) IN GENERAL.—Subject to paragraph (3), any guaranty agency that has entered into or enters into any insurance pro- gram agreement with the Secretary under this part may— (A) offer eligible lenders participating in the agency’s guaranty program a blanket certificate of loan guaranty that permits the lender to make loans without receiving prior approval from the guaranty agency of individual loans for eligible borrowers enrolled in eligible programs at eligible institutions; and (B) provide eligible lenders with the ability to transmit electronically data to the agency concerning loans the lend- er has elected to make under the agency’s insurance pro- gram via standard reporting formats, with such reporting to occur at reasonable and standard intervals.
(2) LIMITATIONS ON BLANKET CERTIFICATE OF GUARANTY.— (A) An eligible lender may not make a loan to a borrower under this section after such lender receives a notification from the guaranty agency that the borrower is not an eligible bor- rower.

(B) A guaranty agency may establish limitations or restric- tions on the number or volume of loans issued by a lender under the blanket certificate of guaranty.
(3) PARTICIPATION LEVEL.—During fiscal years 1999 and 2000, the Secretary may permit, on a pilot basis, a limited number of guaranty agencies to offer blanket certificates of guaranty under this subsection.

Beginning in fiscal year 2001, any guaranty agency that has an insurance program agree- ment with the Secretary may offer blanket certificates of guar- anty under this subsection.
(4) REPORT REQUIRED.—The Secretary shall, at the conclu- sion of the pilot program under paragraph (3), provide a report to the authorizing committees on the impact of the blanket cer- tificates of guaranty on program efficiency and integrity.
(o) ARMED FORCES AND NOAA COMMISSIONED OFFICER CORPS STUDENT LOAN INTEREST PAYMENT PROGRAMS.— (1) AUTHORITY.—Using funds received by transfer to the Secretary under section 2174 of title 10, United States Code, or section 268 of the National Oceanic and Atmospheric Ad- ministration Commissioned Officer Corps Act of 2002 for the payment of interest and any special allowance on a loan to a member of the Armed Forces or an officer in the commissioned officer corps of the National Oceanic and Atmospheric Adminis- tration, respectively, that is made, insured, or guaranteed under this part, the Secretary shall pay the interest and spe- cial allowance on such loan as due for a period not in excess of 36 consecutive months.
The Secretary may not pay interest or any special allowance on such a loan out of any funds other than funds that have been so transferred.

(2) FORBEARANCE.—During the period in which the Sec- retary is making payments on a loan under paragraph (1), the lender shall grant the borrower forbearance in accordance with the guaranty agreement under subsection (c)(3)(A)(i)(IV).
(3) SPECIAL ALLOWANCE DEFINED.—For the purposes of this subsection, the term ‘‘special allowance’’, means a special al- September 8, 2023 As Amended Through P.L.

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428A HIGHER EDUCATION ACT OF 1965 340 lowance that is payable with respect to a loan under section 438.

SEC.

428A.

ø20 U.S.C.


1078–1¿ VOLUNTARY FLEXIBLE AGREEMENTS WITH GUARANTY AGENCIES.

(a) VOLUNTARY AGREEMENTS.— (1) AUTHORITY.—Subject to paragraph (2), the Secretary may enter into a voluntary, flexible agreement with a guaranty agency under this section, in lieu of agreements with a guar- anty agency under subsections (b) and (c) of section 428.
The Secretary may waive or modify any requirement under such subsections, except that the Secretary may not waive— (A) any statutory requirement pertaining to the terms and conditions attached to student loans or default claim payments made to lenders; (B) the prohibitions on inducements contained in sec- tion 428(b)(3); or (C) the Federal default fee required by section 428(b)(1)(H) and the second sentence of section 428H(h).
(2) ELIGIBILITY.—During fiscal years 1999, 2000, and 2001, the Secretary may enter into a voluntary, flexible agreement with not more than 6 guaranty agencies that had 1 or more agreements with the Secretary under subsections (b) and (c) of section 428 as of the day before the date of enactment of the Higher Education Amendments of 1998.

Beginning in fiscal year 2002, any guaranty agency or consortium thereof may enter into a voluntary flexible agreement with the Secretary.
(3) REPORT REQUIRED.— (A) IN GENERAL.—The Secretary, in consultation with the guaranty agencies operating under voluntary flexible agreements, shall report on an annual basis to the author- izing committees regarding the program outcomes that the voluntary flexible agreements have had with respect to— (i) program integrity and program and cost effi- ciencies, delinquency prevention, and default aversion, including a comparison of such outcomes to such out- comes for each guaranty agency operating under an agreement under subsection (b) or (c) of section 428; (ii) consumer education programs described in sec- tion 433A; and (iii) the availability and delivery of student finan- cial aid.
(B) CONTENTS.—Each report described in subpara- graph (A) shall include— (i) a description of each voluntary flexible agree- ment and the performance goals established by the Secretary for each agreement; (ii) a list of— (I) guaranty agencies operating under vol- untary flexible agreements; (II) the specific statutory or regulatory waiv- ers provided to each such guaranty agency; and (III) any other waivers provided to other guar- anty agencies under paragraph (1); September 8, 2023 As Amended Through P.L.
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428A (iii) a description of the standards by which each guaranty agency’s performance under the guaranty agency’s voluntary flexible agreement was assessed and the degree to which each guaranty agency achieved the performance standards; (iv) an analysis of the fees paid by the Secretary, and the costs and efficiencies achieved under each vol- untary flexible agreement; and (v) an identification of promising practices for pro- gram improvement that could be replicated by other guaranty agencies.
(b) TERMS OF AGREEMENT.—An agreement between the Sec- retary and a guaranty agency under this section— (1) shall be developed by the Secretary, in consultation with the guaranty agency, on a case-by-case basis; (2) may only include provisions— (A) specifying the responsibilities of the guaranty agency under the agreement, with respect to— (i) administering the issuance of insurance on loans made under this part on behalf of the Secretary; insurance commitments made (ii) monitoring under this part; (iii) default aversion activities; (iv) review of default claims made by lenders; (v) payment of default claims; (vi) collection of defaulted loans; (vii) adoption of internal systems of accounting and auditing that are acceptable to the Secretary, and reporting the result thereof to the Secretary in a time- ly manner, and on an accurate, and auditable basis; (viii) timely and accurate collection and reporting of such other data as the Secretary may require to carry out the purposes of the programs under this title; (ix) monitoring of institutions and lenders partici- pating in the program under this part; and (x) informational outreach to schools and students in support of access to higher education; (B) regarding the fees the Secretary shall pay, in lieu of revenues that the guaranty agency may otherwise re- ceive under this part, to the guaranty agency under the agreement, and other funds that the guaranty agency may receive or retain under the agreement, except that in no case may the cost to the Secretary of the agreement, as reasonably projected by the Secretary, exceed the cost to the Secretary, as similarly projected, in the absence of the agreement; (C) regarding the use of net revenues, as described in the agreement under this section, for such other activities in support of postsecondary education as may be agreed to by the Secretary and the guaranty agency; (D) regarding the standards by which the guaranty agency’s performance of the agency’s responsibilities under the agreement will be assessed, and the consequences for September 8, 2023 As Amended Through P.L.
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428A HIGHER EDUCATION ACT OF 1965 342 a guaranty agency’s failure to achieve a specified level of performance on 1 or more performance standards; (E) regarding the circumstances in which a guaranty agency’s agreement under this section may be ended in ad- vance of the agreement’s expiration date; (F) regarding such other businesses, previously pur- chased or developed with reserve funds, that relate to the program under this part and in which the Secretary per- mits the guaranty agency to engage; and (G) such other provisions as the Secretary may deter- mine to be necessary to protect the United States from the risk of unreasonable loss and to promote the purposes of this part; (3) shall provide for uniform lender participation with the guaranty agency under the terms of the agreement; and (4) shall not prohibit or restrict borrowers from selecting a lender of the borrower’s choosing, subject to the prohibitions and restrictions applicable to the selection under this Act.
(c) PUBLIC NOTICE.— (1) IN GENERAL.—The Secretary shall publish in the Federal Register a notice to all guaranty agencies that sets forth— (A) an invitation for the guaranty agencies to enter into agreements under this section; and (B) the criteria that the Secretary will use for selecting the guaranty agencies with which the Secretary will enter into agreements under this section.
(2) AGREEMENT NOTICE.—The Secretary shall notify the members of the authorizing committees not later than 30 days prior to concluding an agreement under this section.
The notice shall contain— (A) a description of the voluntary flexible agreement and the performance goals established by the Secretary for the agreement; (B) a list of participating guaranty agencies and the specific statutory or regulatory waivers provided to each guaranty agency; (C) a description of the standards by which each guar- anty agency’s performance under the agreement will be as- sessed; and (D) a description of the fees that will be paid to each participating guaranty agency.
(3) WAIVER NOTICE.—The Secretary shall notify the mem- bers of the authorizing committees not later than 30 days prior to the granting of a waiver pursuant to subsection (a)(2) to a guaranty agency that is not a party to a voluntary flexible agreement.

(4) PUBLIC AVAILABILITY.—The text of any voluntary flexi- ble agreement, and any subsequent revisions, and any waivers related to section 428(b)(3) that are not part of such an agree- ment, shall be readily available to the public.
(5) MODIFICATION NOTICE.—The Secretary shall notify the members of the authorizing committees 30 days prior to any modifications to an agreement under this section.

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428B (d) TERMINATION.—At the expiration or early termination of an agreement under this section, the Secretary shall reinstate the guaranty agency’s prior agreements under subsections (b) and (c) of section 428, subject only to such additional requirements as the Secretary determines to be necessary in order to ensure the effi- cient transfer of responsibilities between the agreement under this section and the agreements under subsections (b) and (c) of section 428, and including the guaranty agency’s compliance with reserve requirements under sections 422 and 428.
SEC.

428B.

ø20 U.S.C.

1078–2¿ FEDERAL PLUS LOANS.
(a) AUTHORITY TO BORROW.— (1) AUTHORITY AND ELIGIBILITY.—Prior to July 1, 2010, a graduate or professional student or the parents of a dependent student shall be eligible to borrow funds under this section in amounts specified in subsection (b), if— (A) the graduate or professional student or the parents do not have an adverse credit history as determined pursu- ant to regulations promulgated by the Secretary; (B) in the case of a graduate or professional student or parent who has been convicted of, or has pled nolo contendere or guilty to, a crime involving fraud in obtain- ing funds under this title, such graduate or professional student or parent has completed the repayment of such funds to the Secretary, or to the holder in the case of a loan under this title obtained by fraud; and (C) the graduate or professional student or the parents meet such other eligibility criteria as the Secretary may establish by regulation, after consultation with guaranty agencies, eligible lenders, and other organizations involved in student financial assistance.
(2) TERMS, CONDITIONS, AND BENEFITS.—Except as pro- vided in subsections (c), (d), and (e), loans made under this sec- tion shall have the same terms, conditions, and benefits as all other loans made under this part.

(3) SPECIAL RULES.— (A) PARENT BORROWERS.—Whenever necessary to carry out the provisions of this section, the terms ‘‘student’’ and ‘‘borrower’’ as used in this part shall include a parent borrower under this section.
(B)(i) EXTENUATING CIRCUMSTANCES.—An eligible lend- er may determine that extenuating circumstances exist under the regulations promulgated pursuant to paragraph (1)(A) if, during the period beginning January 1, 2007, and ending December 31, 2009, an applicant for a loan under this section— (I) is or has been delinquent for 180 days or fewer on mortgage loan payments or on medical bill pay- ments during such period; and (II) does not otherwise have an adverse credit his- tory, as determined by the lender in accordance with the regulations promulgated pursuant to paragraph (1)(A), as such regulations were in effect on the day September 8, 2023 As Amended Through P.L.
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428B HIGHER EDUCATION ACT OF 1965 344 before the date of enactment of the Ensuring Contin- ued Access to Student Loans Act of 2008.
(ii) DEFINITION OF MORTGAGE LOAN.—In this subpara- graph, the term ‘‘mortgage loan’’ means an extension of credit to a borrower that is secured by the primary resi- dence of the borrower.

(iii) RULE OF CONSTRUCTION.—Nothing in this sub- paragraph shall be construed to limit an eligible lender’s authority under the regulations promulgated pursuant to paragraph (1)(A) to determine that extenuating cir- cumstances exist.
(b) LIMITATION BASED ON NEED.—Any loan under this section may be counted as part of the expected family contribution 1 in the determination of need under this title, but no loan may be made to any graduate or professional student or any parent under this section for any academic year in excess of (A) the student’s esti- mated cost of attendance, minus (B) other financial aid as certified by the eligible institution under section 428(a)(2)(A).
The annual insurable limit on account of any student shall not be deemed to be exceeded by a line of credit under which actual payments to the borrower will not be made in any year in excess of the annual limit.
(c) PLUS LOAN DISBURSEMENT.—All loans made under this section shall be disbursed in accordance with the requirements of section 428G and shall be disbursed by— (1) an electronic transfer of funds from the lender to the eligible institution; or (2) a check copayable to the eligible institution and the graduate or professional student or parent borrower.
(d) PAYMENT OF PRINCIPAL AND INTEREST.— (1) COMMENCEMENT OF REPAYMENT.—Repayment of prin- cipal on loans made under this section shall commence not later than 60 days after the date such loan is disbursed by the lender, subject to deferral— (A)(i) during any period during which the parent bor- rower or the graduate or professional student borrower meets the conditions required for a deferral under section 427(a)(2)(C) or 428(b)(1)(M); and (ii) upon the request of the parent borrower, during any period during which the student on whose behalf the loan was borrowed by the parent borrower meets the con- ditions section a 427(a)(2)(C)(i)(I) or 428(b)(1)(M)(i)(I); and required deferral under for (B)(i) in the case of a parent borrower, upon the re- quest of the parent borrower, during the 6-month period beginning on the later of— (I) the day after the date the student on whose be- half the loan was borrowed ceases to carry at least one-half the normal full-time academic workload (as determined by the institution); or (II) if the parent borrower is also a student, the day after the date such parent borrower ceases to carry at least one-half such a workload; and September 8, 2023 As Amended Through P.L.
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428B (ii) in the case of a graduate or professional student borrower, during the 6-month period beginning on the day after the date such student ceases to carry at least one- half the normal full-time academic workload (as deter- mined by the institution).
(2) CAPITALIZATION OF INTEREST.— (A) IN GENERAL.—Interest on loans made under this section for which payments of principal are deferred pursu- ant to paragraph (1) shall, if agreed upon by the borrower and the lender— (i) be paid monthly or quarterly; or (ii) be added to the principal amount of the loan not more frequently than quarterly by the lender.

(B) INSURABLE LIMITS.—Capitalization of interest under this paragraph shall not be deemed to exceed the annual insurable limit on account of the borrower.
(3) SUBSIDIES PROHIBITED.—No payments to reduce inter- est costs shall be paid pursuant to section 428(a) of this part on loans made pursuant to this section.

(4) APPLICABLE RATES OF INTEREST.—Interest on loans made pursuant to this section shall be at the applicable rate of interest provided in section 427A for loans made under this section.
25 (5) AMORTIZATION.—The amount of the periodic payment and the repayment schedule for any loan made pursuant to this section shall be established by assuming an interest rate equal to the applicable rate of interest at the time the repay- ment of the principal amount of the loan commences.
At the option of the lender, the note or other written evidence of the loan may require that— (A) the amount of the periodic payment will be ad- justed annually, or (B) the period of repayment of principal will be length- ened or shortened, in order to reflect adjustments in interest rates occurring as a consequence of section 427A(c)(4).
(e) REFINANCING.— (1) REFINANCING TO SECURE COMBINED PAYMENT.—An eli- gible lender may at any time consolidate loans held by it which are made under this section to a borrower, including loans which were made under section 428B as in effect prior to the enactment of the Higher Education Amendments of 1986, under a single repayment schedule which provides for a single principal payment and a single payment of interest, and shall calculate the repayment period for each included loan from the date of the commencement of repayment of the most recent in- cluded loan.
Unless the consolidated loan is obtained by a bor- rower who is electing to obtain variable interest under para- graph (2) or (3), such consolidated loan shall bear interest at the weighted average of the rates of all included loans.

The ex- 25 Section 416(a)(2) of the Higher Education Amendments of 1998 (P.L.

105–244; 112 Stat.
105–244; 112 Stat.

1680) contained an amendment that could not be executed and was redundant because of an earlier amendment in section 8301(a)(2) of the Transportation Equity Act for the 21st Century (P.L.

105–178; 112 Stat.

497).

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428B HIGHER EDUCATION ACT OF 1965 346 tension of any repayment period of an included loan pursuant to this paragraph shall be reported (if required by them) to the Secretary or guaranty agency insuring the loan, as the case may be, but no additional insurance premiums shall be pay- able with respect to any such extension.
The extension of the repayment period of any included loan shall not require the formal extension of the promissory note evidencing the in- cluded loan or the execution of a new promissory note, but shall be treated as an administrative forbearance of the repay- ment terms of the included loan.
(2) REFINANCING TO SECURE VARIABLE INTEREST RATE.—An eligible lender may reissue a loan which was made under this section before July 1, 1987, or under section 428B as in effect prior to the enactment of the Higher Education Amendments of 1986 in order to permit the borrower to obtain the interest rate provided under section 427A(c)(4).
A lender offering to re- issue a loan or loans for such purpose may charge a borrower an amount not to exceed $100 to cover the administrative costs of reissuing such loan or loans, not more than one-half of which shall be paid to the guarantor of the loan being reissued to cover costs of reissuance.

Reissuance of a loan under this paragraph shall not affect any insurance applicable with re- spect to the loan, and no additional insurance fee may be charged to the borrower with respect to the loan.
(3) REFINANCING BY DISCHARGE OF PREVIOUS LOAN.—A bor- rower who has applied to an original lender for reissuance of a loan under paragraph (2) and who is denied such reissuance may obtain a loan from another lender for the purpose of dis- charging the loan from such original lender.
A loan made for such purpose— (A) shall bear interest at the applicable rate of interest provided under section 427A(c)(4); (B) shall not result in the extension of the duration of the note (other than as permitted under subsection (d)(5)(B)); (C) may be subject to an additional insurance fee but shall not be subject to the administrative cost charge per- mitted by paragraph (2) of this subsection; and (D) shall be applied to discharge the borrower from any remaining obligation to the original lender with re- spect to the original loan.
(4) CERTIFICATION IN LIEU OF PROMISSORY NOTE PRESEN- TATION.—Each new lender may accept certification from the original lender of the borrower’s original loan in lieu of presen- tation of the original promissory note.
(f) VERIFICATION OF IMMIGRATION STATUS AND SOCIAL SECURITY NUMBER.—A parent who wishes to borrow funds under this section shall be subject to verification of the parent’s— (1) immigration status in the same manner as immigration status is verified for students under section 484(g); and September 8, 2023 As Amended Through P.L.
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428C (2) social security number in the same manner as social se- for students under section curity numbers are verified 484(p) 26.

SEC.

428C.

ø20 U.S.C.

1078–3¿ FEDERAL CONSOLIDATION LOANS.
(a) AGREEMENTS WITH ELIGIBLE LENDERS.— (1) AGREEMENT REQUIRED FOR INSURANCE COVERAGE.—For the purpose of providing loans to eligible borrowers for consoli- dation of their obligations with respect to eligible student loans, the Secretary or a guaranty agency shall enter into agreements in accordance with subsection (b) with the fol- lowing eligible lenders: (A) the Student Loan Marketing Association or the Holding Company of the Student Loan Marketing Associa- tion, including any subsidiary of the Holding Company, created pursuant to section 440; (B) State agencies described in subparagraphs (D) and (F) of section 435(d)(1); and (C) other eligible lenders described in subparagraphs (A), (B), (C), (E), and (J) of such section.
(2) INSURANCE COVERAGE OF CONSOLIDATION LOANS.—Ex- cept as provided in section 429(e), no contract of insurance under this part shall apply to a consolidation loan unless such loan is made under an agreement pursuant to this section and is covered by a certificate issued in accordance with subsection (b)(2).
Loans covered by such a certificate that is issued by a guaranty agency shall be considered to be insured loans for the purposes of reimbursements under section 428(c), but no pay- ment shall be made with respect to such loans under section 428(f) to any such agency.
(3) DEFINITION OF ELIGIBLE BORROWER.—(A) For the purpose of this section, the term ‘‘eligible borrower’’ means a borrower who— (i) is not subject to a judgment secured through litiga- tion with respect to a loan under this title or to an order for wage garnishment under section 488A; and (ii) at the time of application for a consolidation loan— (I) is in repayment status as determined under section 428(b)(7)(A); is (II) ment; or in a grace period preceding repay- (III) is a defaulted borrower who has made ar- rangements to repay the obligation on the defaulted loans satisfactory to the holders of the defaulted loans.
(B)(i) An individual’s status as an eligible borrower under this section or under section 455(g) terminates under both sec- tions upon receipt of a consolidation loan under this section or under section 455(g), except that— (I) an individual who receives eligible student loans after the date of receipt of the consolidation loan may re- ceive a subsequent consolidation loan; 26 Effective no later than July 1, 2023, section 702(n)(1)(B) of division FF of Public Law 116– 260 provides for an amendment to paragraph (2) by striking ‘‘section 484(p)’’ and inserting ‘‘sec- tion 484(o)’’.
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428C HIGHER EDUCATION ACT OF 1965 348 (II) loans received prior to the date of the consolida- tion loan may be added during the 180-day period fol- lowing the making of the consolidation loan; (III) loans received following the making of the consoli- dation loan may be added during the 180-day period fol- lowing the making of the consolidation loan; (IV) loans received prior to the date of the first consoli- dation loan may be added to a subsequent consolidation loan; and (V) 27 an individual may obtain a subsequent consolidation loan under section 455(g) only— (aa) for the purposes of obtaining income contingent repayment or income-based repay- ment, and only if the loan has been submitted to the guaranty agency for default aversion or if the loan is already in default; (bb) for the purposes of using the public service loan forgiveness program under sec- tion 455(m); (cc) 28 for the purpose of using the no accrual of in- terest for active duty service members benefit offered under section 455(o).
(dd) for the purpose of separating a joint consolidation loan into 2 separate Federal Di- rect Consolidation Loans under section 455(g)(2).
(4) DEFINITION OF ELIGIBLE STUDENT LOANS.—For the pur- pose of paragraph (1), the term ‘‘eligible student loans’’ means loans— (A) made, insured, or guaranteed under this part, and first disbursed before July 1, 2010, including loans on which the borrower has defaulted (but has made arrange- ments to repay the obligation on the defaulted loans satis- factory to the Secretary or guaranty agency, whichever in- sured the loans); (B) made under part E of this title; (C) made under part D of this title; (D) made under subpart II of part A of title VII of the Public Health Service Act; or (E) made under part E of title VIII of the Public Health Service Act.
(b) CONTENTS OF AGREEMENTS, CERTIFICATES OF INSURANCE, AND LOAN NOTES.— (1) AGREEMENTS WITH LENDERS.—Any lender described in subparagraph (A), (B), or (C) of subsection (a)(1) who wishes to make consolidation loans under this section shall enter into an agreement with the Secretary or a guaranty agency which pro- vides— (A) that, in the case of all lenders described in sub- section (a)(1), the lender will make a consolidation loan to an eligible borrower (on request of that borrower) only if September 8, 2023 As Amended Through P.L.
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28 Margin so in law; or HOLC G:\COMP\EDIII\HIGHER EDUCATION ACT OF 1965.XML 349 HIGHER EDUCATION ACT OF 1965 Sec.
428C the borrower certifies that the borrower has no other appli- cation pending for a loan under this section; (B) that each consolidation loan made by the lender will bear interest, and be subject to repayment, in accord- ance with subsection (c); (C) that each consolidation loan will be made, notwith- standing any other provision of this part limiting the an- nual or aggregate principal amount for all insured loans made to a borrower, in an amount (i) which is not less than the minimum amount required for eligibility of the borrower under subsection (a)(3), and (ii) which is equal to the sum of the unpaid principal and accrued unpaid inter- est and late charges of all eligible student loans received by the eligible borrower which are selected by the borrower for consolidation; (D) that the proceeds of each consolidation loan will be paid by the lender to the holder or holders of the loans so selected to discharge the liability on such loans; (E) that the lender shall offer an income-sensitive re- payment schedule, established by the lender in accordance with the regulations promulgated by the Secretary, to the borrower of any consolidation loan made by the lender on or after July 1, 1994, and before July 1, 2010; (F) that the lender shall disclose to a prospective bor- rower, in simple and understandable terms, at the time the lender provides an application for a consolidation loan— (i) whether consolidation would result in a loss of loan benefits under this part or part D, including loan forgiveness, cancellation, and deferment; (ii) with respect to Federal Perkins Loans under part E— (I) that if a borrower includes a Federal Per- kins Loan under part E in the consolidation loan, the borrower will lose all interest-free periods that would have been available for the Federal Perkins Loan, such as— (aa) the periods during which no interest accrues on such loan while the borrower is en- rolled in school at least half-time; (bb) the grace period under section 464(c)(1)(A); and (cc) the periods during which the bor- rower’s student loan repayments are deferred under section 464(c)(2); (II) that if a borrower includes a Federal Per- kins Loan in the consolidation loan, the borrower will no longer be eligible for cancellation of part or all of the Federal Perkins Loan under section 465(a); and (III) the occupations listed in section 465 that qualify for Federal Perkins Loan cancellation under section 465(a); September 8, 2023 As Amended Through P.L.
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428C HIGHER EDUCATION ACT OF 1965 350 (iii) the repayment plans that are available to the borrower; (iv) the options of the borrower to prepay the con- solidation loan, to pay such loan on a shorter schedule, and to change repayment plans; (v) that borrower benefit programs for a consolida- tion loan may vary among different lenders; (vi) the consequences of default on the consolida- tion loan; and (vii) that by applying for a consolidation loan, the borrower is not obligated to agree to take the consoli- dation loan; and (G) such other terms and conditions as the Secretary or the guaranty agency may specifically require of the lender to carry out this section.
(2) ISSUANCE OF CERTIFICATE OF COMPREHENSIVE INSUR- ANCE COVERAGE.—The Secretary shall issue a certificate of comprehensive insurance coverage under section 429(b) to a lender which has entered into an agreement with the Secretary under paragraph (1) of this subsection.

The guaranty agency may issue a certificate of comprehensive insurance coverage to a lender with which it has an agreement under such para- graph.
The Secretary shall not issue a certificate to a lender described in subparagraph (B) or (C) of subsection (a)(1) unless the Secretary determines that such lender has first applied to, and has been denied a certificate of insurance by, the guaranty agency which insures the preponderance of its loans (by value).
(3) CONTENTS OF CERTIFICATE.—A certificate issued under paragraph (2) shall, at a minimum, provide— (A) that all consolidation loans made by such lender in conformity with the requirements of this section will be in- sured by the Secretary or the guaranty agency (whichever is applicable) against loss of principal and interest; (B) that a consolidation loan will not be insured unless the lender has determined to its satisfaction, in accordance with reasonable and prudent business practices, for each loan being consolidated— (i) that the loan is a legal, valid, and binding obli- gation of the borrower; (ii) that each such loan was made and serviced in compliance with applicable laws and regulations; and (iii) in the case of loans under this part, that the insurance on such loan is in full force and effect; (C) the effective date and expiration date of the certifi- cate; (D) the aggregate amount to which the certificate ap- plies; (E) the reporting requirements of the Secretary on the lender and an identification of the office of the Department of Education or of the guaranty agency which will process claims and perform other related administrative functions; (F) the alternative repayment terms which will be of- fered to borrowers by the lender; September 8, 2023 As Amended Through P.L.
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428C (G) that, if the lender prior to the expiration of the certificate no longer proposes to make consolidation loans, the lender will so notify the issuer of the certificate in order that the certificate may be terminated (without af- fecting the insurance on any consolidation loan made prior to such termination); and (H) the terms upon which the issuer of the certificate may limit, suspend, or terminate the lender’s authority to make consolidation loans under the certificate (without af- fecting the insurance on any consolidation loan made prior to such limitation, suspension, or termination).
(4) TERMS AND CONDITIONS OF LOANS.—A consolidation loan made pursuant to this section shall be insurable by the Secretary or a guaranty agency pursuant to paragraph (2) only if the loan is made to an eligible borrower who has agreed to notify the holder of the loan promptly concerning any change of address and the loan is evidenced by a note or other written agreement which— (A) is made without security and without endorse- ment, except that if the borrower is a minor and such note or other written agreement executed by him or her would not, under applicable law, create a binding obligation, en- dorsement may be required; (B) provides for the payment of interest and the repay- ment of principal in accordance with subsection (c) of this section; (C)(i) provides that periodic installments of principal need not be paid, but interest shall accrue and be paid in accordance with clause (ii), during any period for which the borrower would be eligible for a deferral under section 428(b)(1)(M), and that any such period shall not be in- cluded in determining the repayment schedule pursuant to subsection (c)(2) of this section; and (ii) provides that interest shall accrue and be paid dur- ing any such period— (I) by the Secretary, in the case of a consolidation loan for which the application is received by an eligi- ble lender before the date of enactment of the Emer- gency Student Loan Consolidation Act of 1997 that consolidated only Federal Stafford Loans for which the student borrower received an interest subsidy under section 428; (II) by the Secretary, in the case of a consolidation loan for which the application is received by an eligi- ble lender on or after the date of enactment of the Emergency Student Loan Consolidation Act of 1997 except that the Secretary shall pay such interest only on that portion of the loan that repays Federal Staf- ford Loans for which the student borrower received an interest subsidy under section 428 or Federal Direct Stafford Loans for which the borrower received an in- terest subsidy under section 455; or September 8, 2023 As Amended Through P.L.
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428C HIGHER EDUCATION ACT OF 1965 352 (III) by the borrower, or capitalized, in the case of a consolidation loan other than a loan described in subclause (I) or (II); (D) entitles the borrower to accelerate without penalty repayment of the whole or any part of the loan; and (E)(i) contains a notice of the system of disclosure con- cerning such loan to consumer reporting agencies under section 430A, and (ii) provides that the lender on request of the borrower will provide information on the repayment status of the note to such consumer reporting agencies.
(5) DIRECT LOANS.—If, before July 1, 2010, a borrower is unable to obtain a consolidation loan from a lender with an agreement under subsection (a)(1), or is unable to obtain a con- solidation loan with income-sensitive repayment terms or in- come-based repayment terms acceptable to the borrower from such a lender, or chooses to obtain a consolidation loan for the purposes of using the public service loan forgiveness program offered under section 455(m), the Secretary shall offer any such borrower who applies for it, a Federal Direct Consolidation loan.
In addition, in the event that a borrower chooses to ob- tain a consolidation loan for the purposes of using the no ac- crual of interest for active duty service members program of- fered under section 455(o), the Secretary shall offer a Federal Direct Consolidation loan to any such borrower who applies for participation in such program.
A direct consolidation loan of- fered under this paragraph shall, as requested by the bor- rower, be repaid either pursuant to income contingent repay- ment under part D of this title, pursuant to income-based re- payment under section 493C, or pursuant to any other repay- ment provision under this section, except that if a borrower in- tends to be eligible to use the public service loan forgiveness program under section 455(m), such loan shall be repaid using one of the repayment options described in section 455(m)(1)(A).
The Secretary shall not offer such loans if, in the Secretary’s judgment, the Department of Education does not have the nec- essary origination and servicing arrangements in place for such loans.
(6) NONDISCRIMINATION IN LOAN CONSOLIDATION.—An eli- gible lender that makes consolidation loans under this section shall not discriminate against any borrower seeking such a loan— (A) based on the number or type of eligible student loans the borrower seeks to consolidate, except that a lend- er is not required to consolidate loans described in sub- paragraph (D) or (E) of subsection (a)(4) or subsection (d)(1)(C)(ii); (B) based on the type or category of institution of high- er education that the borrower attended; (C) based on the interest rate to be charged to the bor- rower with respect to the consolidation loan; or (D) with respect to the types of repayment schedules offered to such borrower.
(c) PAYMENT OF PRINCIPAL AND INTEREST.— September 8, 2023 As Amended Through P.L.

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428C (1) INTEREST RATE.—(A) Notwithstanding subparagraphs (B) and (C), with respect to any loan made under this section for which the application is received by an eligible lender— (i) on or after October 1, 1998, and before July 1, 2006, the applicable interest rate shall be determined under sec- tion 427A(k)(4); or (ii) on or after July 1, 2006, and that is disbursed be- fore July 1, 2010, the applicable interest rate shall be de- termined under section 427A(l)(3).
(B) A consolidation loan made before July 1, 1994, shall bear interest at an annual rate on the unpaid principal balance of the loan that is equal to the greater of— (i) the weighted average of the interest rates on the loans consolidated, rounded to the nearest whole percent; or (ii) 9 percent.
(C) A consolidation loan made on or after July 1, 1994, and disbursed before July 1, 2010, shall bear interest at an annual rate on the unpaid principal balance of the loan that is equal to the weighted average of the interest rates on the loans con- solidated, rounded upward to the nearest whole percent.
(D) A consolidation loan for which the application is re- ceived by an eligible lender on or after the date of enactment of the Emergency Student Loan Consolidation Act of 1997 and before October 1, 1998, shall bear interest at an annual rate on the unpaid principal balance of the loan that is equal to the rate specified in section 427A(f), except that the eligible lender may continue to calculate interest on such a loan at the rate previously in effect and defer, until not later than April 1, 1998, the recalculation of the interest on such a loan at the rate required by this subparagraph if the recalculation is ap- plied retroactively to the date on which the loan is made.
(2) REPAYMENT SCHEDULES.—(A) Notwithstanding any other provision of this part, to the extent authorized by its cer- tificate of insurance under subsection (b)(2) and approved by the issuer of such certificate, the lender of a consolidation loan shall establish repayment terms as will promote the objectives of this section, which shall include the establishment of grad- uated, income-sensitive, or income-based repayment schedules, established by the lender in accordance with the regulations of the Secretary.
Except as required by such income-sensitive or income-based repayment schedules, or by the terms of repay- ment pursuant to income contingent repayment offered by the Secretary under subsection (b)(5), such repayment terms shall require that if the sum of the consolidation loan and the amount outstanding on other student loans to the individual— (i) is less than $7,500, then such consolidation loan shall be repaid in not more than 10 years; (ii) is equal to or greater than $7,500 but less than $10,000, then such consolidation loan shall be repaid in not more than 12 years; (iii) is equal to or greater than $10,000 but less than $20,000, then such consolidation loan shall be repaid in not more than 15 years; September 8, 2023 As Amended Through P.L.
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428C HIGHER EDUCATION ACT OF 1965 354 (iv) is equal to or greater than $20,000 but less than $40,000, then such consolidation loan shall be repaid in not more than 20 years; (v) is equal to or greater than $40,000 but less than $60,000, then such consolidation loan shall be repaid in not more than 25 years; or (vi) is equal to or greater than $60,000, then such con- solidation loan shall be repaid in not more than 30 years.
(B) The amount outstanding on other student loans which may be counted for the purpose of subparagraph (A) may not exceed the amount of the consolidation loan.
(3) ADDITIONAL REPAYMENT REQUIREMENTS.—Notwith- standing paragraph (2)— (A) except in the case of an income-based repayment schedule under section 493C, a repayment schedule estab- lished with respect to a consolidation loan shall require that the minimum installment payment be an amount equal to not less than the accrued unpaid interest; (B) except as required by the terms of repayment pur- suant to income contingent repayment offered by the Sec- retary under subsection (b)(5), the lender of a consolidation loan may, with respect to repayment on the loan, when the amount of a monthly or other similar payment on the loan is not a multiple of $5, round the payment to the next highest whole dollar amount that is a multiple of $5; and (C) an income-based repayment schedule under section 493C shall not be available to a consolidation loan bor- rower who used the proceeds of the loan to discharge the liability on a loan under section 428B, or a Federal Direct PLUS loan, made on behalf of a dependent student.
(4) COMMENCEMENT OF REPAYMENT.—Repayment of a con- solidation loan shall commence within 60 days after all holders have, pursuant to subsection (b)(1)(D), discharged the liability of the borrower on the loans selected for consolidation.
(5) INSURANCE PREMIUMS PROHIBITED.—No insurance pre- mium shall be charged to the borrower on any consolidation loan, and no insurance premium shall be payable by the lender to the Secretary with respect to any such loan, but a fee may be payable by the lender to the guaranty agency to cover the costs of increased or extended liability with respect to such loan.
(d) SPECIAL PROGRAM AUTHORIZED.— (1) GENERAL RULE AND DEFINITION OF ELIGIBLE STUDENT LOAN.— (A) IN GENERAL.—Subject to the provisions of this sub- section, the Secretary or a guaranty agency shall enter into agreements with eligible lenders described in subpara- graphs (A), (B), and (C) of subsection (a)(1) for the consoli- dation of eligible student loans.
(B) APPLICABILITY RULE.—Unless otherwise provided in this subsection, the agreements entered into under sub- paragraph (A) and the loans made under such agreements for the consolidation of eligible student loans under this subsection shall have the same terms, conditions, and ben- September 8, 2023 As Amended Through P.L.
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428C efits as all other agreements and loans made under this section.
(C) DEFINITION.—For the purpose of this subsection, the term ‘‘eligible student loans’’ means loans— (i) of the type described in subparagraphs (A), (B), and (C) of subsection (a)(4); and (ii) made under subpart I of part A of title VII of the Public Health Service Act.
(2) INTEREST RATE RULE.— (A) IN GENERAL.—The portion of each consolidated loan that is attributable to an eligible student loan de- scribed in paragraph (1)(C)(ii) shall bear interest at a rate not to exceed the rate determined under subparagraph (B).
(B) DETERMINATION OF THE MAXIMUM INTEREST RATE.—For the 12-month period beginning after July 1, 1992, and for each 12-month period thereafter, beginning on July 1 and ending on June 30, the interest rate applica- ble under subparagraph (A) shall be equal to the average of the bond equivalent rates of the 91-day Treasury bills auctioned for the quarter prior to July 1, for each 12- month period for which the determination is made, plus 3 percent.
(C) PUBLICATION OF MAXIMUM INTEREST RATE.—The Secretary shall determine the applicable rate of interest under subparagraph (B) after consultation with the Sec- retary of the Treasury and shall publish such rate in the Federal Register as soon as practicable after the date of such determination.
(3) SPECIAL RULES.— (A) NO SPECIAL ALLOWANCE RULE.—No special allow- ance under section 438 shall be paid with respect to the portion of any consolidated loan under this subsection that in paragraph is attributable to any (1)(C)(ii).

loan described (B) NO INTEREST SUBSIDY RULE.—No interest subsidy under section 428(a) shall be paid on behalf of any eligible borrower for any portion of a consolidated loan under this subsection that is attributable to any loan described in paragraph (1)(C)(ii).
(C) ADDITIONAL RESERVE RULE.—Notwithstanding any other provision of this Act, additional reserves shall not be required for any guaranty agency with respect to a loan made under this subsection.
(D) INSURANCE RULE.—Any insurance premium paid by the borrower under subpart I of part A of title VII of the Public Health Service Act with respect to a loan made under that subpart and consolidated under this subsection shall be retained by the student loan insurance account es- tablished under section 710 of the Public Health Service Act.

(4) REGULATIONS.—The Secretary is authorized to promul- gate such regulations as may be necessary to facilitate carrying out the provisions of this subsection.
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428D HIGHER EDUCATION ACT OF 1965 356 (e) TERMINATION OF AUTHORITY.—The authority to make loans under this section expires at the close of June 30, 2010.

No loan may be made under this section for which the disbursement is on or after July 1, 2010.
Nothing in this section shall be construed to authorize the Secretary to promulgate rules or regulations gov- erning the terms or conditions of the agreements and certificates under subsection (b).

Loans made under this section which are in- sured by the Secretary shall be considered to be new loans made to students for the purpose of section 424(a).
(f) INTEREST PAYMENT REBATE FEE.— (1) IN GENERAL.—For any month beginning on or after Oc- tober 1, 1993, each holder of a consolidation loan under this section for which the first disbursement was made on or after October 1, 1993, shall pay to the Secretary, on a monthly basis and in such manner as the Secretary shall prescribe, a rebate fee calculated on an annual basis equal to 1.05 percent of the principal plus accrued unpaid interest on such loan.
(2) SPECIAL RULE.—For consolidation loans based on appli- cations received during the period from October 1, 1998 through January 31, 1999, inclusive, the rebate described in paragraph (1) shall be equal to 0.62 percent of the principal plus accrued unpaid interest on such loan.

(3) DEPOSIT.—The Secretary shall deposit all fees collected pursuant to this subsection into the insurance fund established in section 431.

SEC.

428D.

ø20 U.S.C.

1078–4¿ COMMINGLING OF FUNDS.
Notwithstanding any other provision of this part regarding permissible uses of funds from any source, funds received by a guaranty agency under any provision of this part may be commin- gled with funds received under any other provision of this part and may be used to carry out the purposes of such other provision, ex- cept that— (1) the total amount expended for the purposes of such other provision shall not exceed the amount the guaranty agency would otherwise be authorized to expend; and (2) the authority to commingle such funds shall not relieve such agency of any accounting or auditing obligations under this part.
øSection 428E was repealed by section 605(b) of Public Law 102–164; 105 Stat.

1068.¿ SEC.

428F.

ø20 U.S.C.

1078–6¿ DEFAULT REDUCTION PROGRAM.
(a) OTHER REPAYMENT INCENTIVES.— (1) SALE OR ASSIGNMENT OF LOAN.— (A) IN GENERAL.—Each guaranty agency, upon secur- ing 9 payments made within 20 days of the due date dur- ing 10 consecutive months of amounts owed on a loan for which the Secretary has made a payment under paragraph (1) of section 428(c), shall— (i) if practicable, sell the loan to an eligible lender; or (ii) beginning July 1, 2014, assign the loan to the Secretary if the guaranty agency has been unable to sell the loan under clause (i).
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428F (B) MONTHLY PAYMENTS.—Neither the guaranty agen- cy nor the Secretary shall demand from a borrower as monthly payment amounts described in subparagraph (A) more than is reasonable and affordable based on the bor- rower’s total financial circumstances.
(C) CONSUMER REPORTING AGENCIES.—Upon the sale or assignment of the loan, the Secretary, guaranty agency or other holder of the loan shall request any consumer re- porting agency to which the Secretary, guaranty agency or holder, as applicable, reported the default of the loan, to remove the record of the default from the borrower’s credit history.
(D) DUTIES UPON SALE.—With respect to a loan sold under subparagraph (A)(i)— (i) the guaranty agency— (I) shall, in the case of a sale made on or after July 1, 2014, repay the Secretary 100 percent of the amount of the principal balance outstanding at the time of such sale, multiplied by the reinsur- ance percentage in effect when payment under the guaranty agreement was made with respect to the loan; and (II) may, in the case of a sale made on or after July 1, 2014, in order to defray collection costs— (aa) charge to the borrower an amount not to exceed 16 percent of the outstanding principal and interest at the time of the loan sale; and (bb) retain such amount from the pro- ceeds of the loan sale; and (ii) the Secretary shall reinstate the Secretary’s obligation to— (I) reimburse the guaranty agency for the amount that the agency may, in the future, ex- pend to discharge the guaranty agency’s insurance obligation; and (II) pay to the holder of such loan a special al- lowance pursuant to section 438.
(E) DUTIES UPON ASSIGNMENT.—With respect to a loan assigned under subparagraph (A)(ii)— (i) the guaranty agency shall add to the principal and interest outstanding at the time of the assignment of such loan an amount equal to the amount described in subparagraph (D)(i)(II)(aa); and (ii) the Secretary shall pay the guaranty agency, for deposit in the agency’s Operating Fund established pursuant to section 422B, an amount equal to the amount added to the principal and interest out- standing at the time of the assignment in accordance with clause (i).
(F) ELIGIBLE LENDER LIMITATION.—A loan shall not be sold to an eligible lender under subparagraph (A)(i) if such lender has been found by the guaranty agency or the Sec- September 8, 2023 As Amended Through P.L.

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428G HIGHER EDUCATION ACT OF 1965 358 retary to have substantially failed to exercise the due dili- gence required of lenders under this part.

(G) DEFAULT DUE TO ERROR.—A loan that does not meet the requirements of subparagraph (A) may also be el- igible for sale or assignment under this paragraph upon a determination that the loan was in default due to clerical or data processing error and would not, in the absence of such error, be in a delinquent status.
(2) USE OF PROCEEDS OF SALES.—Amounts received by the Secretary pursuant to the sale of such loans by a guaranty agency under paragraph (1)(A)(i) shall be deducted from the calculations of the amount of reimbursement for which the agency is eligible under paragraph (1)(D)(ii)(I) for the fiscal year in which the amount was received, notwithstanding the fact that the default occurred in a prior fiscal year.
(3) BORROWER ELIGIBILITY.—Any borrower whose loan is sold or assigned under paragraph (1)(A) shall not be precluded by section 484 from receiving additional loans or grants under this title (for which he or she is otherwise eligible) on the basis of defaulting on the loan prior to such loan sale or assignment.
(4) APPLICABILITY OF GENERAL LOAN CONDITIONS.—A loan that is sold or assigned under paragraph (1) shall, so long as the borrower continues to make scheduled repayments thereon, be subject to the same terms and conditions and qualify for the same benefits and privileges as other loans made under this part.

(5) LIMITATION.—A borrower may obtain the benefits avail- able under this subsection with respect to rehabilitating a loan (whether by loan sale or assignment) only one time per loan.
(b) SATISFACTORY REPAYMENT ARRANGEMENTS TO RENEW ELI- GIBILITY.—Each guaranty agency shall establish a program which allows a borrower with a defaulted loan or loans to renew eligibility for all title IV student financial assistance (regardless of whether the defaulted loan has been sold to an eligible lender or assigned to the Secretary) upon the borrower’s payment of 6 consecutive monthly payments.
The guaranty agency shall not demand from a borrower as a monthly payment amount under this subsection more than is reasonable and affordable based upon the borrower’s total financial circumstances.

A borrower may only obtain the ben- efit of this subsection with respect to renewed eligibility once.

(c) FINANCIAL AND ECONOMIC LITERACY.—Each program de- scribed in subsection (b) shall include making available financial and economic education materials for a borrower who has rehabili- tated a loan.

SEC.
SEC.

428G.

ø20 U.S.C.

1078–7¿ REQUIREMENTS FOR DISBURSEMENT OF STUDENT LOANS.

(a) MULTIPLE DISBURSEMENT REQUIRED.— (1) TWO DISBURSEMENTS REQUIRED.—The proceeds of any loan made, insured, or guaranteed under this part that is made for any period of enrollment shall be disbursed in 2 or more installments, none of which exceeds one-half of the loan.
(2) MINIMUM INTERVAL REQUIRED.—The interval between the first and second such installments shall be not less than one-half of such period of enrollment, except as necessary to September 8, 2023 As Amended Through P.L.

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428G permit the second installment to be disbursed at the beginning of the second semester, quarter, or similar division of such pe- riod of enrollment.
(3) 29 SPECIAL RULE.—An institution whose cohort default rate (as determined under section 435(m)) for each of the 3 most recent fiscal years for which data are available is less than 10 percent may disburse any loan made, insured, or guar- anteed under this part in a single installment for any period of enrollment that is not more than 1 semester, 1 trimester, 1 quarter, or 4 months.
Notwithstanding section 422(d) of the Higher Education Amendments of 1998, this paragraph shall be effective beginning on the date of enactment of the Higher Education Reconciliation Act of 2005.

(4) AMENDMENT TO SPECIAL RULE.—Beginning on October 1, 2011, the special rule under paragraph (3) shall be applied by substituting ‘‘15 percent’’ for ‘‘10 percent’’.
(b) DISBURSEMENT AND ENDORSEMENT REQUIREMENTS.— (1) FIRST YEAR STUDENTS.—The first installment of the proceeds of any loan made, insured, or guaranteed under this part that is made to a student borrower who is entering the first year of a program of undergraduate education, and who has not previously obtained a loan under this part, shall not (regardless of the amount of such loan or the duration of the period of enrollment) be presented by the institution to the stu- dent for endorsement until 30 days after the borrower begins a course of study, but may be delivered to the eligible institu- tion prior to the end of that 30-day period.
An institution whose cohort default rate (as determined under section 435(m)) for each of the three most recent fiscal years for which data are available is less than 10 percent shall be exempt from the re- quirements of this paragraph.

30 Notwithstanding section 422(d) of the Higher Education Amendments of 1998, the sec- ond sentence of this paragraph shall be effective beginning on the date of enactment of the Higher Education Reconciliation Act of 2005.
(2) OTHER STUDENTS.—The proceeds of any loan made, in- sured, or guaranteed under this part that is made to any stu- dent other than a student described in paragraph (1) shall not be disbursed more than 30 days prior to the beginning of the period of enrollment for which the loan is made.
(3) AMENDMENT TO COHORT DEFAULT RATE EXEMPTION.— Beginning on October 1, 2011, the exemption to the require- ments of paragraph (1) in the second sentence of such para- graph shall be applied by substituting ‘‘15 percent’’ for ‘‘10 per- cent’’.

(c) METHOD OF MULTIPLE DISBURSEMENT.—Disbursements under subsection (a)— 29 Section 422(a) of Public Law 105–244 added paragraph (3).
Section 422(d) of such Act states the amendments made by subsections (a) and (b) of section 422 shall be effective during the period beginning on October 1, 1998, and ending on September 30, 2002.

30 Section 422(b) of Public Law 105–244 added a new sentence at the end.

Section 422(d) of such Act states the amendments made by subsections (a) and (b) shall be effective during the period beginning on October 1, 1998, and ending on September 30, 2002.

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428G HIGHER EDUCATION ACT OF 1965 360 (1) shall be made in accordance with a schedule provided by the institution (under section 428(a)(2)(A)(i)(II)) that com- plies with the requirements of this section; (2) may be made directly by the lender or, in the case of a loan under sections 428 and 428A, may be disbursed pursu- ant to the escrow provisions of section 428(i); and (3) notwithstanding subsection (a)(2), may, with the per- mission of the borrower, be disbursed by the lender on a week- ly or monthly basis, provided that the proceeds of the loan are disbursed by the lender in substantially equal weekly or monthly installments, as the case may be, over the period of enrollment for which the loan is made.
(d) WITHHOLDING OF SECOND DISBURSEMENT.— (1) WITHDRAWING STUDENTS.—A lender or escrow agent that is informed by the borrower or the institution that the borrower has ceased to be enrolled before the disbursement of the second or any succeeding installment shall withhold such disbursement.

Any disbursement which is so withheld shall be credited to the borrower’s loan and treated as a prepayment thereon.
(2) STUDENTS RECEIVING OVER-AWARDS.—If the sum of a disbursement for any student and the other financial aid ob- tained by such student exceeds the amount of assistance for which the student is eligible under this title, the institution such student is attending shall withhold and return to the lender or escrow agent the portion (or all) of such installment that exceeds such eligible amount, except that overawards per- mitted pursuant to section 443(b)(4) of the Act shall not be con- strued to be overawards for purposes of this paragraph.
Any portion (or all) of a disbursement installment which is so re- turned shall be credited to the borrower’s loan and treated as a prepayment thereon.
(e) EXCLUSION OF CONSOLIDATION AND FOREIGN STUDY LOANS.—The provisions of this section shall not apply in the case of a loan made under section 428C, or made to a student to cover the cost of attendance in a program of study abroad approved by the home eligible institution if the home eligible institution has a cohort default rate (as calculated under section 435(m)) of less than 5 percent.
(f) BEGINNING OF PERIOD OF ENROLLMENT.—For purposes of this section, a period of enrollment begins on the first day that classes begin for the applicable period of enrollment.
(g) SALES PRIOR TO DISBURSEMENT PROHIBITED.—An eligible lender shall not sell or transfer a promissory note for any loan made, insured, or guaranteed under this part until the final dis- bursement of such loan has been made, except that the prohibition of this subsection shall not apply if— (1) the sale of the loan does not result in a change in the identity of the party to whom payments will be made for the loan; and (2) the first disbursement of such loan has been made.
September 8, 2023 As Amended Through P.L.

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428H SEC.

428H.

ø20 U.S.C.

1078–8¿ UNSUBSIDIZED STAFFORD LOANS FOR MIDDLE-INCOME BORROWERS.
(a) IN GENERAL.—It is the purpose of this section to authorize insured loans under this part that are first disbursed before July 1, 2010, for borrowers who do not qualify for Federal interest sub- sidy payments under section 428 of this Act.

Except as provided in this section, all terms and conditions for Federal Stafford loans es- tablished under section 428 shall apply to loans made pursuant to this section.
(b) ELIGIBLE BORROWERS.—Prior to July 1, 2010, any student meeting the requirements for student eligibility under section 484 (including graduate and professional students as defined in regula- tions promulgated by the Secretary) shall be entitled to borrow an unsubsidized Federal Stafford Loan for which the first disburse- ment is made before such date if the eligible institution at which the student has been accepted for enrollment, or at which the stu- dent is in attendance, has— (1) determined and documented the student’s need for the loan based on the student’s estimated cost of attendance (as determined under section 472) and the student’s estimated fi- nancial assistance, including a loan which qualifies for interest subsidy payments under section 428; and (2) provided the lender a statement— (A) certifying the eligibility of the student to receive a loan under this section and the amount of the loan for which such student is eligible, in accordance with sub- section (c); and (B) setting forth a schedule for disbursement of the proceeds of the loan in installments, consistent with the requirements of section 428G.
(c) DETERMINATION OF AMOUNT OF LOAN.—The determination of the amount of a loan by an eligible institution under subsection (b) shall be calculated by subtracting from the estimated cost of at- tendance at the eligible institution any estimated financial assist- ance reasonably available to such student.
An eligible institution may not, in carrying out the provisions of subsection (b) of this sec- tion, provide a statement which certifies the eligibility of any stu- dent to receive any loan under this section in excess of the amount calculated under the preceding sentence.
(d) LOAN LIMITS.— (1) IN GENERAL.—Except as provided in paragraphs (2), (3), and (4), the annual and aggregate limits for loans under this section shall be the same as those established under section 428(b)(1), less any amount received by such student pursuant to the subsidized loan program established under section 428.
(2) LIMITS FOR GRADUATE, PROFESSIONAL, AND INDE- PENDENT POSTBACCALAUREATE STUDENTS.— (A) ANNUAL LIMITS.—The maximum annual amount of loans under this section a graduate or professional stu- dent, or a student described in clause (ii), may borrow in any academic year (as defined in section 481(a)(2)) or its equivalent shall be the amount determined under para- graph (1), plus— September 8, 2023 As Amended Through P.L.
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428H HIGHER EDUCATION ACT OF 1965 362 (i) in the case of such a student who is a graduate or professional student attending an eligible institu- tion, $12,000; and (ii) notwithstanding paragraph (4), in the case of an independent student, or a dependent student whose parents are unable to borrow under section 428B or the Federal Direct PLUS Loan Program, who has ob- tained a baccalaureate degree and who is enrolled in coursework specified in paragraph (3)(B) or (4)(B) of section 484(b)— (I) $7,000 for coursework necessary for enroll- ment in a graduate or professional program; and (II) $7,000 for coursework necessary for a pro- fessional credential or certification from a State required for employment as a teacher in an ele- mentary or secondary school, except in cases where the Secretary determines that a higher amount is warranted in order to carry out the pur- pose of this part with respect to students engaged in spe- cialized training requiring exceptionally high costs of edu- cation, but the annual insurable limit per student shall not be deemed to be exceeded by a line of credit under which actual payments by the lender to the borrower will not be made in any years in excess of the annual limit.
(B) AGGREGATE LIMIT.—The maximum aggregate amount of loans under this section a student described in subparagraph (A) may borrow shall be the amount de- scribed in paragraph (1), adjusted to reflect the increased annual limits described in subparagraph (A), as prescribed by the Secretary by regulation.
(3) LIMITS FOR UNDERGRADUATE DEPENDENT STUDENTS.— (A) ANNUAL LIMITS.—The maximum annual amount of loans under this section an undergraduate dependent stu- dent (except an undergraduate dependent student whose parents are unable to borrow under section 428B or the Federal Direct PLUS Loan Program) may borrow in any academic year (as defined in section 481(a)(2)) or its equiv- alent shall be the sum of the amount determined under paragraph (1), plus $2,000.
(B) AGGREGATE LIMITS.—The maximum aggregate amount of loans under this section a student described in subparagraph (A) may borrow shall be $31,000.
(4) LIMITS FOR UNDERGRADUATE INDEPENDENT STUDENTS.— (A) ANNUAL LIMITS.—The maximum annual amount of loans under this section an undergraduate independent student, or an undergraduate dependent student whose parents are unable to borrow under section 428B or the Federal Direct PLUS Loan Program, may borrow in any academic year (as defined in section 481(a)(2)) or its equiv- alent shall be the sum of the amount determined under paragraph (1), plus— (i) in the case of such a student attending an eligi- ble institution who has not completed such student’s first 2 years of undergraduate study— September 8, 2023 As Amended Through P.L.
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428H (I) $6,000, if such student is enrolled in a pro- gram whose length is at least one academic year in length; or (II) if such student is enrolled in a program of undergraduate education which is less than one academic year, the maximum annual loan amount that such student may receive may not exceed the amount that bears the same ratio to the amount specified in subclause (I) as the length of such pro- gram measured in semester, trimester, quarter, or clock hours bears to one academic year; (ii) in the case of such a student at an eligible in- stitution who has successfully completed such first and second years but has not successfully completed the remainder of a program of undergraduate edu- cation— (I) $7,000; or (II) if such student is enrolled in a program of undergraduate education, the remainder of which is less than one academic year, the maximum an- nual loan amount that such student may receive may not exceed the amount that bears the same ratio to the amount specified in subclause (I) as such remainder measured in semester, trimester, quarter, or clock hours bears to one academic year; and (iii) in the case of such a student enrolled in coursework specified in— (I) section 484(b)(3)(B), $6,000; or (II) section 484(b)(4)(B), $7,000.
(B) AGGREGATE LIMITS.—The maximum aggregate amount of loans under this section a student described in subparagraph (A) may borrow shall be $57,500.

(5) CAPITALIZED INTEREST.—Interest capitalized shall not be deemed to exceed a maximum aggregate amount deter- mined under subparagraph (B) of paragraph (2), (3), or (4).
(e) PAYMENT OF PRINCIPAL AND INTEREST.— (1) COMMENCEMENT OF REPAYMENT.—Repayment of prin- cipal on loans made under this section shall begin at the begin- ning of the repayment period described in section 428(b)(7).

Not less than 30 days prior to the anticipated commencement of such repayment period, the holder of such loan shall provide notice to the borrower that interest will accrue before repay- ment begins and of the borrower’s option to begin loan repay- ment at an earlier date.
(2) CAPITALIZATION OF INTEREST.—(A) Except as provided in subparagraph (C), interest on loans made under this section for which payments of principal are not required during the in- school and grace periods or for which payments are deferred under sections 427(a)(2)(C) and 428(b)(1)(M) shall, if agreed upon by the borrower and the lender— (i) be paid monthly or quarterly; or (ii) be added to the principal amount of the loan by the lender only— September 8, 2023 As Amended Through P.L.
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428H HIGHER EDUCATION ACT OF 1965 364 (I) when the loan enters repayment; (II) at the expiration of a grace period, in the case of a loan that qualifies for a grace period; (III) at the expiration of a period of deferment or forbearance; or (IV) when the borrower defaults.
(B) The capitalization of interest described in subpara- graph (A) shall not be deemed to exceed the annual insurable limit on account of the student.

(C) Interest shall not accrue on a loan deferred under sec- tion 428(b)(1)(M)(v) or 427(a)(2)(C)(iv).

(3) SUBSIDIES PROHIBITED.—No payments to reduce inter- est costs shall be paid pursuant to section 428(a) of this part on loans made pursuant to this section.
(4) APPLICABLE RATES OF INTEREST.—Interest on loans made pursuant to this section shall be at the applicable rate of interest provided in section 427A.

(5) AMORTIZATION.—The amount of the periodic payment and the repayment schedule for any loan made pursuant to this section shall be established by assuming an interest rate equal to the applicable rate of interest at the time the repay- ment of the principal amount of the loan commences.
At the option of the lender, the note or other written evidence of the loan may require that— (A) the amount of the periodic payment will be ad- justed annually; or (B) the period of repayment of principal will be length- ened or shortened, in order to reflect adjustments in interest rates occurring as a consequence of section 427A(c)(4).
(6) REPAYMENT PERIOD.—For purposes of calculating the repayment period under section 428(b)(9), such period shall commence at the time the first payment of principal is due from the borrower.
(7) QUALIFICATION FOR FORBEARANCE.—A lender may grant the borrower of a loan under this section a forbearance for a period not to exceed 60 days if the lender reasonably de- termines that such a forbearance from collection activity is warranted following a borrower’s request for forbearance, deferment, or a change in repayment plan, or a request to con- solidate loans in order to collect or process appropriate sup- porting documentation related to the request.
During any such period, interest on the loan shall accrue but not be capitalized.

ø(f) Repealed¿ (g) SINGLE APPLICATION FORM AND LOAN REPAYMENT SCHED- ULE.—A guaranty agency shall use a single application form and a single repayment schedule for subsidized Federal Stafford loans made pursuant to section 428 and for unsubsidized Federal Staf- ford loans made pursuant to this section.
(h) INSURANCE PREMIUM.—Each State or nonprofit private in- stitution or organization having an agreement with the Secretary under section 428(b)(1) may charge a borrower under this section an insurance premium equal to not more than 1.0 percent of the principal amount of the loan, if such premium will not be used for September 8, 2023 As Amended Through P.L.
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428J incentive payments to lenders.
Effective for loans for which the date of guarantee of principal is on or after July 1, 2006, and that are first disbursed before July 1, 2010, in lieu of the insurance pre- mium authorized under the preceding sentence, each State or non- profit private institution or organization having an agreement with the Secretary under section 428(b)(1) shall collect and deposit into the Federal Student Loan Reserve Fund under section 422A, a Fed- eral default fee of an amount equal to 1.0 percent of the principal amount of the loan, which fee shall be collected either by deduction from the proceeds of the loan or by payment from other non-Fed- eral sources.
The Federal default fee shall not be used for incentive payments to lenders.

SEC.

428J.

31 ø20 U.S.C.

1078–10¿ LOAN FORGIVENESS FOR TEACHERS.

(a) STATEMENT OF PURPOSE.—It is the purpose of this section to encourage individuals to enter and continue in the teaching pro- fession.
(b) PROGRAM AUTHORIZED.—The Secretary shall carry out a program, through the holder of the loan, of assuming the obligation to repay a qualified loan amount for a loan made under section 428 or 428H, in accordance with subsection (c), for any new borrower on or after October 1, 1998, who— (1) has been employed as a full-time teacher for 5 consecu- tive complete school years— (A) in a school or location that qualifies under section 465(a)(2)(A) for loan cancellation for Perkins loan recipi- ents who teach in such schools or locations; and (B) if employed as an elementary school or secondary school teacher, is highly qualified as defined in section 9101 of the Elementary Secondary Education Act of 1965, or meets the requirements of subsection (g)(3); and (2) is not in default on a loan for which the borrower seeks forgiveness.
(c) QUALIFIED LOANS AMOUNT.— (1) IN GENERAL.—The Secretary shall repay not more than $5,000 in the aggregate of the loan obligation on a loan made under section 428 or 428H that is outstanding after the com- pletion of the fifth complete school year of teaching described in subsection (b)(1).

No borrower may receive a reduction of loan obligations under both this section and section 460.
(2) TREATMENT OF CONSOLIDATION LOANS.—A loan amount for a loan made under section 428C may be a qualified loan amount for the purposes of this subsection only to the extent that such loan amount was used to repay a Federal Direct Stafford Loan, a Federal Direct Unsubsidized Stafford Loan, or a loan made under section 428 or 428H for a borrower who meets the requirements of subsection (b), as determined in ac- cordance with regulations prescribed by the Secretary.
(3) ADDITIONAL AMOUNTS FOR TEACHERS IN MATHEMATICS, the SCIENCE, OR amount specified in paragraph (1), the aggregate amount that the Secretary shall repay under this section shall be not more than $17,500 in the case of— EDUCATION.—Notwithstanding SPECIAL September 8, 2023 As Amended Through P.L.

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796).
796).

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428J HIGHER EDUCATION ACT OF 1965 366 (A) a secondary school teacher— (i) who meets the requirements of subsection (b); and (ii) whose qualifying employment for purposes of such subsection is teaching mathematics or science on a full-time basis; and (B) an elementary school or secondary school teacher— (i) who meets the requirements of subsection (b); (ii) whose qualifying employment for purposes of such subsection is as a special education teacher whose primary responsibility is to provide special edu- cation to children with disabilities (as those terms are defined in section 602 of the Individuals with Disabil- ities Education Act); and (iii) who, as certified by the chief administrative officer of the public or non-profit private elementary school or secondary school in which the borrower is employed, or, in the case of a teacher who is employed by an educational service agency, as certified by the chief administrative officer of such agency, is teaching children with disabilities that correspond with the bor- rower’s special education training and has dem- onstrated knowledge and teaching skills in the content areas of the elementary school or secondary school cur- riculum that the borrower is teaching.
(d) REGULATIONS.—The Secretary is authorized to issue such regulations as may be necessary to carry out the provisions of this section.

(e) CONSTRUCTION.—Nothing in this section shall be construed to authorize any refunding of any repayment of a loan.
(f) LIST.—If the list of schools in which a teacher may perform service pursuant to subsection (b) is not available before May 1 of any year, the Secretary may use the list for the year preceding the year for which the determination is made to make such service de- termination.
(g) ADDITIONAL ELIGIBILITY PROVISIONS.— (1) CONTINUED ELIGIBILITY.—Any teacher who performs service in a school that— (A) meets the requirements of subsection (b)(1)(A) in any year during such service; and (B) in a subsequent year fails to meet the require- ments of such subsection, may continue to teach in such school and shall be eligible for loan forgiveness pursuant to subsection (b).
(2) PREVENTION OF DOUBLE BENEFITS.—No borrower may, for the same service, receive a benefit under both this section and— (A) section 428K; (B) section 455(m); or (C) subtitle D of title I of the National and Community Service Act of 1990 (42 U.S.C.

12601 et seq.).

(3) PRIVATE SCHOOL TEACHERS.—An individual who is em- ployed as a teacher in a private school and is exempt from State certification requirements (unless otherwise applicable September 8, 2023 As Amended Through P.L.
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428K under State law), may, in lieu of the requirement of subsection (b)(1)(B), have such employment treated as qualifying employ- ment under this section if such individual is permitted to and does satisfy rigorous subject knowledge and skills tests by tak- ing competency tests in the applicable grade levels and subject areas.
For such purposes, the competency tests taken by such a private school teacher shall be recognized by 5 or more States for the purpose of fulfilling the highly qualified teacher requirements under section 9101 of the Elementary and Sec- ondary Education Act of 1965, and the score achieved by such teacher on each test shall equal or exceed the average passing score of those 5 States.
(h) DEFINITION.—For purposes of this section, the term ‘‘year’’, where applied to service as a teacher, means an academic year as defined by the Secretary.

SEC.

428K.

ø20 U.S.C.

1078–11¿ LOAN FORGIVENESS FOR SERVICE IN AREAS OF NATIONAL NEED.
(a) PROGRAM AUTHORIZED.— (1) LOAN FORGIVENESS AUTHORIZED.—The Secretary shall forgive, in accordance with this section, the qualified loan amount described in subsection (c) of the student loan obliga- tion of a borrower who— (A) is employed full-time in an area of national need, as described in subsection (b); and (B) is not in default on a loan for which the borrower seeks forgiveness.
(2) METHOD OF LOAN FORGIVENESS.—To provide loan for- giveness under paragraph (1), the Secretary is authorized to carry out a program— (A) through the holder of the loan, to assume the obli- gation to repay a qualified loan amount for a loan made, insured, or guaranteed under this part (other than an ex- cepted PLUS loan or an excepted consolidation loan (as such terms are defined in section 493C(a))); and (B) to cancel a qualified loan amount for a loan made under part D of this title (other than an excepted PLUS loan or an excepted consolidation loan).
(3) REGULATIONS.—The Secretary is authorized to issue such regulations as may be necessary to carry out this section.

(b) AREAS OF NATIONAL NEED.—For purposes of this section, an individual is employed in an area of national need if the indi- vidual meets the requirements of one of the following: (1) EARLY CHILDHOOD EDUCATORS.—The individual is em- ployed full-time as an early childhood educator.
(2) NURSES.—The individual is employed full-time— (A) as a nurse in a clinical setting; or (B) as a member of the nursing faculty at an accred- ited school of nursing (as those terms are defined in sec- tion 801 of the Public Health Service Act (42 U.S.C.

296)).

(3) FOREIGN LANGUAGE SPECIALISTS.—The individual— (A) has obtained a baccalaureate or advanced degree in a critical foreign language; and (B) is employed full-time— September 8, 2023 As Amended Through P.L.
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428K HIGHER EDUCATION ACT OF 1965 368 (i) in an elementary school or secondary school as a teacher of a critical foreign language; (ii) in an agency of the United States Government in a position that regularly requires the use of such critical foreign language; or (iii) in an institution of higher education as a fac- ulty member or instructor teaching a critical foreign language.
(4) LIBRARIANS.—The individual is employed full-time as a librarian in— (A) a public library that serves a geographic area with- in which the public schools have a combined average of 30 percent or more of the schools’ total student enrollments composed of children meeting a measure of poverty under section 1113(a)(5) of the Elementary and Secondary Edu- cation Act of 1965; or (B) a school that qualifies under section 465(a)(2)(A) for loan cancellation for Perkins loan recipients who teach in such a school.
(5) HIGHLY QUALIFIED TEACHERS SERVING STUDENTS WHO ARE LIMITED ENGLISH PROFICIENT, LOW-INCOME COMMUNITIES, AND UNDERREPRESENTED POPULATIONS.—The individual— (A) is highly qualified, as such term is defined in sec- tion 9101 of the Elementary and Secondary Education Act of 1965; and (B) is employed full-time— (i) as a teacher educating students who are lim- ited English proficient; (ii) as a teacher in a school that qualifies under section 465(a)(2)(A) for loan cancellation for Perkins loan recipients who teach in such a school; (iii) as a teacher and is an individual from an underrepresented population in the teaching profes- sion, as determined by the Secretary; or (iv) as a teacher in an educational service agency, as such term is defined in section 8101 of the Elemen- tary and Secondary Education Act of 1965.
(6) CHILD WELFARE WORKERS.—The individual— (A) has obtained a degree in social work or a related field with a focus on serving children and families; and (B) is employed full-time in public or private child wel- fare services.
(7) SPEECH-LANGUAGE PATHOLOGISTS AND AUDIOLOGISTS.— The individual— (A) is employed full-time as a speech-language pathol- ogist or audiologist in an eligible preschool program or a school that qualifies under section 465(a)(2)(A) for loan cancellation for Perkins loan recipients who teach in such a school; and (B) has, at a minimum, a graduate degree in speech- language pathology, audiology, or communication sciences and disorders.
(8) SCHOOL COUNSELORS.—The individual— September 8, 2023 As Amended Through P.L.

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428K (A) is employed full-time as a school counselor who has documented competence in counseling children and adolescents in a school setting and who— (i) is licensed by the State or certified by an inde- pendent professional regulatory authority; (ii) in the absence of such State licensure or cer- tification, possesses national certification in school counseling or a specialty of counseling granted by an independent professional organization; or (iii) holds a minimum of a master’s degree in school counseling from a program accredited by the Council for Accreditation of Counseling and Related Educational Programs or the equivalent; and (B) is so employed in a school that qualifies under sec- tion 465(a)(2)(A) for loan cancellation for Perkins loan re- cipients who teach in such a school.
(9) PUBLIC SECTOR EMPLOYEES.—The individual is em- ployed full-time in— (A) public safety (including as a first responder, fire- fighter, police officer, or other law enforcement or public safety officer); (B) emergency management (including as an emer- gency medical technician); (C) public health (including full-time professionals en- gaged in health care practitioner occupations and health care support occupations, as such terms are defined by the Bureau of Labor Statistics); or (D) public interest legal services (including prosecu- tion, public defense, or legal advocacy in low-income com- munities at a nonprofit organization).
(10) NUTRITION PROFESSIONALS.—The individual— (A) is a licensed, certified, or registered dietician who has completed a degree in a relevant field; and (B) is employed full-time as a dietician with an agency of the special supplemental nutrition program for women, infants, and children under section 17 of the Child Nutri- tion Act of 1966 (42 U.S.C.

1786).
(11) MEDICAL SPECIALISTS.—The individual— (A) has received a degree from a medical school at an institution of higher education; and (B) has been accepted to, or currently participates in, a full-time graduate medical education training program or fellowship (or both) to provide health care services (as rec- ognized by the Accreditation Council for Graduate Medical Education) that— (i) requires more than five years of total graduate medical training; and (ii) has fewer United States medical school grad- uate applicants than the total number of positions available in such program or fellowship.
(12) MENTAL HEALTH PROFESSIONALS.—The individual— (A) has not less than a master’s degree in social work, psychology, or psychiatry; and September 8, 2023 As Amended Through P.L.

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428K HIGHER EDUCATION ACT OF 1965 370 (B) is employed full-time providing mental health serv- ices to children, adolescents, or veterans.
(13) DENTISTS.—The individual— (A)(i) has received a degree from an accredited dental school (as accredited by the Commission on Dental Accred- itation); (ii) has completed residency training in pediatric den- tistry, general dentistry, or dental public health; and (iii) is employed full-time as a dentist; or (B) is employed full-time as a member of the faculty at a program or school accredited by the Commission on Dental Accreditation.
(14) STEM EMPLOYEES.—The individual is employed full- time in applied sciences, technology, engineering, or mathe- matics.

(15) PHYSICAL THERAPISTS.—The individual— (A) is a physical therapist; and (B) is employed full-time providing physical therapy services to children, adolescents, or veterans.
(16) SUPERINTENDENTS, PRINCIPALS, AND OTHER ADMINIS- TRATORS.—The individual is employed full-time as a school su- perintendent, principal, or other administrator in a local edu- cational agency, including in an educational service agency, in which 30 percent or more of the schools are schools that qual- ify under section 465(a)(2)(A) for loan cancellation for Perkins loan recipients who teach in such a school.
(17) OCCUPATIONAL THERAPISTS.—The individual is an oc- cupational therapist and is employed full-time providing occu- pational therapy services to children, adolescents, or veterans.
(18) ALLIED HEALTH PROFESSIONALS.—The individual is employed full-time as an allied health professional— (A) in a Federal, State, local, or tribal public health agency; or (B) in a setting where patients might require health care services, including acute care facilities, ambulatory care facilities, personal residences and other settings lo- cated in health professional shortage areas, medically un- derserved areas, or medically underserved populations, as recognized by the Secretary of Health and Human Serv- ices.
(c) QUALIFIED LOAN AMOUNT.— (1) IN GENERAL.—Subject to paragraph (2), for each school, academic, or calendar year of full-time employment in an area of national need described in subsection (b) that a borrower completes on or after the date of enactment of the Higher Edu- cation Opportunity Act, the Secretary shall forgive not more than $2,000 of the student loan obligation of the borrower that is outstanding after the completion of each such school, aca- demic, or calendar year of employment, respectively.
(2) MAXIMUM AMOUNT.—The Secretary shall not forgive more than $10,000 in the aggregate for any borrower under this section, and no borrower shall receive loan forgiveness under this section for more than five years of service.

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428K (d) PRIORITY.—The Secretary shall grant loan forgiveness under this section on a first-come, first-served basis, and subject to the availability of appropriations.

(e) RULE OF CONSTRUCTION.—Nothing in this section shall be construed to authorize the refunding of any repayment of a loan.

(f) INELIGIBILITY FOR DOUBLE BENEFITS.—No borrower may, for the same service, receive a reduction of loan obligations under both this section and section 428J, 428L, 455(m), or 460.
(g) DEFINITIONS.—In this section: (1) ALLIED HEALTH PROFESSIONAL.—The term ‘‘allied health professional’’ means an allied health professional as de- fined in section 799B(5) of the Public Heath Service Act (42 U.S.C.
295p(5)) who— (A) has graduated and received an allied health pro- fessions degree or certificate from an institution of higher education; and (B) is employed with a Federal, State, local or tribal public health agency, or in a setting where patients might require health care services, including acute care facilities, ambulatory care facilities, personal residences and other settings located in health professional shortage areas, medically underserved areas, or medically underserved populations, as recognized by the Secretary of Health and Human Services.
(2) AUDIOLOGIST.—The term ‘‘audiologist’’ means an indi- vidual who— (A) has received, at a minimum, a graduate degree in audiology from an institution of higher education accred- ited by an agency or association recognized by the Sec- retary pursuant to section 496(a); and (B)(i) provides audiology services under subsection (ll)(2) of section 1861 of the Social Security Act (42 U.S.C.
1395x(ll)(2)); or (ii) meets or exceeds the qualifications for a qualified audiologist under subsection (ll)(4) of such section (42 U.S.C.

1395x(ll)(4)).
(3) EARLY CHILDHOOD EDUCATOR.—The term ‘‘early child- hood educator’’ means an individual who— (A) works directly with children in an eligible pre- school program or eligible early childhood education pro- gram in a low-income community; (B) is involved directly in the care, development, and education of infants, toddlers, or young children age five and under; and (C) has completed a baccalaureate or advanced degree in early childhood development or early childhood edu- cation, or in a field related to early childhood education.
(4) ELIGIBLE PRESCHOOL PROGRAM.—The term ‘‘eligible pre- school program’’ means a program that— (A) provides for the care, development, and education of infants, toddlers, or young children age five and under; (B) meets any applicable State or local government li- censing, certification, approval, and registration require- ments, and September 8, 2023 As Amended Through P.L.
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428K HIGHER EDUCATION ACT OF 1965 372 (C) is operated by— (i) a public or private school that is supported, sponsored, supervised, or administered by a local edu- cational agency; (ii) a Head Start agency serving as a grantee des- ignated under the Head Start Act (42 U.S.C.

9831 et seq.
9831 et seq.

); (iii) a nonprofit or community based organization; or (iv) a child care program, including a home.
(5) ELIGIBLE EARLY CHILDHOOD EDUCATION PROGRAM.—The term ‘‘eligible early childhood education program’’ means— (A) a family child care program, center-based child care program, State prekindergarten program, school pro- gram, or other out-of-home early childhood development care program, that— (i) is licensed or regulated by the State; and (ii) serves two or more unrelated children who are not old enough to attend kindergarten; (B) a Head Start Program carried out under the Head Start Act (42 U.S.C.
9831 et seq.

); or (C) an Early Head Start Program carried out under section 645A of the Head Start Act (42 U.S.C.

9840a).
9840a).

(6) LOW-INCOME COMMUNITY.—The term ‘‘low-income com- munity’’ means a school attendance area (as defined in section 1113(a)(2)(A) of the Elementary and Secondary Education Act of 1965)— (A) in which 70 percent of households earn less than 85 percent of the State median household income; or (B) that includes a school that qualifies under section 465(a)(2)(A) for loan cancellation for Perkins loan recipi- ents who teach in such a school.
(7) NURSE.—The term ‘‘nurse’’ means a nurse who meets all of the following: (A) The nurse graduated from— (i) an accredited school of nursing (as those terms are defined in section 801 of the Public Health Service Act (42 U.S.C.

296)); (ii) a nursing center; or (iii) an academic health center that provides nurse training.

(B) The nurse holds a valid and unrestricted license to practice nursing in the State in which the nurse practices in a clinical setting.
(C) The nurse holds one or more of the following: (i) A graduate degree in nursing, or an equivalent degree.

(ii) A nursing degree from a collegiate school of nursing (as defined in section 801 of the Public Health Service Act (42 U.S.C.

296)).

(iii) A nursing degree from an associate degree school of nursing (as defined in such section).

(iv) A nursing degree from a diploma school of nursing (as defined in such section).

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428L (8) OCCUPATIONAL THERAPIST.—The term ‘‘occupational therapist’’ means an individual who— (A) has received, at a minimum, a baccalaureate de- gree in occupational therapy from an institution of higher education accredited by an agency or association recog- nized by the Secretary pursuant to section 496(a); and (B)(i) provides occupational therapy services under section 1861(g) of the Social Security Act (42 U.S.C.
1395x(g)); or (ii) meets or exceeds the qualifications for a qualified occupational therapist, as determined by State law.
(9) PHYSICAL THERAPIST.—The term ‘‘physical therapist’’ means an individual who— (A) has received, at a minimum, a graduate degree in physical therapy from an institution of higher education accredited by an agency or association recognized by the Secretary pursuant to section 496(a); and (B)(i) provides physical therapy services under section 1861(p) of the Social Security Act (42 U.S.C.

1395x(p)); or (ii) meets or exceeds the qualifications for a qualified physical therapist, as determined by State law.
(10) SPEECH-LANGUAGE PATHOLOGIST.—The term ‘‘speech- language pathologist’’ means a speech-language pathologist who— (A) has received, at a minimum, a graduate degree in speech-language pathology or communication sciences and disorders from an institution of higher education accred- ited by an agency or association recognized by the Sec- retary pursuant to section 496(a); and (B) provides speech-language pathology services under section 1861(ll)(1) of the Social Security Act (42 U.S.C.
1395x(ll)(1)), or meets or exceeds the qualifications for a qualified speech-language pathologist under subsection (ll)(4) of such section (42 U.S.C.

1395x(ll)(4)).

(h) AUTHORIZATION OF APPROPRIATIONS.—There are authorized to be appropriated to carry out this section such sums as may be necessary for fiscal year 2009 and each of the five succeeding fiscal years to provide loan forgiveness in accordance with this section.

SEC.

428L.

ø20 U.S.C.


1078–12¿ LOAN REPAYMENT FOR CIVIL LEGAL AS- SISTANCE ATTORNEYS.

(a) PURPOSE.—The purpose of this section is to encourage qualified individuals to enter and continue employment as civil legal assistance attorneys.
(b) DEFINITIONS.—In this section: (1) CIVIL LEGAL ASSISTANCE ATTORNEY.—The term ‘‘civil legal assistance attorney’’ means an attorney who— (A) is a full-time employee of— (i) a nonprofit organization that provides legal as- sistance with respect to civil matters to low-income in- dividuals without a fee; or (ii) a protection and advocacy system or client as- sistance program that provides legal assistance with respect to civil matters and receives funding under— September 8, 2023 As Amended Through P.L.
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428L HIGHER EDUCATION ACT OF 1965 374 (I) subtitle C of title I of the Developmental Disabilities Assistance and Bill of Rights Act of 2000 (42 U.S.C.

15041 et seq.

); (II) section 112 or 509 of the Rehabilitation Act of 1973 (29 U.S.C.
732, 794e); (III) part A of title I of the Protection and Ad- vocacy for Individuals with Mental Illness Act (42 U.S.C.

10801 et seq.

); (IV) section 5 of the Assistive Technology Act of 1998 (29 U.S.C.

3004); (V) section 1150 of the Social Security Act (42 U.S.C.

1320b–21); (VI) section 1253 of the Public Health Service Act (42 U.S.C.

300d–53); or (VII) section 291 of the Help America Vote Act of 2002 (42 U.S.C.
15461); (B) as such employee, provides civil legal assistance as described in subparagraph (A) on a full-time basis; and (C) is continually licensed to practice law.
(2) STUDENT LOAN.— (A) IN GENERAL.—Except as provided in subparagraph (B), the term ‘‘student loan’’ means— (i) subject to clause (ii), a loan made, insured, or guaranteed under this part, part D, or part E; and (ii) a loan made under section 428C or 455(g), to the extent that such loan was used to repay— (I) a Federal Direct Stafford Loan, a Federal Direct Unsubsidized Stafford Loan, or a Federal Direct PLUS Loan; (II) a loan made under section 428, 428B, or 428H; or (III) a loan made under part E. (B) EXCLUSION OF PARENT PLUS LOANS.—The term ‘‘student loan’’ does not include any of the following loans: (i) A loan made to the parents of a dependent stu- dent under section 428B.
(ii) A Federal Direct PLUS Loan made to the par- ents of a dependent student.

(iii) A loan made under section 428C or 455(g), to the extent that such loan was used to repay— (I) a loan made to the parents of a dependent student under section 428B; or (II) a Federal Direct PLUS Loan made to the parents of a dependent student.
(c) PROGRAM AUTHORIZED.—From amounts appropriated under subsection (i) for a fiscal year, the Secretary shall carry out a pro- gram of assuming the obligation to repay a student loan, by direct payments on behalf of a borrower to the holder of such loan, in ac- cordance with subsection (d), for any borrower who— (1) is employed as a civil legal assistance attorney; and (2) is not in default on a loan for which the borrower seeks repayment.

(d) TERMS OF AGREEMENT.— September 8, 2023 As Amended Through P.L.
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428L (1) IN GENERAL.—To be eligible to receive repayment bene- fits under subsection (c), a borrower shall enter into a written agreement with the Secretary that specifies that— (A) the borrower will remain employed as a civil legal assistance attorney for a required period of service of not less than three years, unless involuntarily separated from that employment; (B) if the borrower is involuntarily separated from em- ployment on account of misconduct, or voluntarily sepa- rates from employment, before the end of the period speci- fied in the agreement, the borrower will repay the Sec- retary the amount of any benefits received by such em- ployee under this agreement; (C) if the borrower is required to repay an amount to the Secretary under subparagraph (B) and fails to repay such amount, a sum equal to that amount shall be recover- able by the Federal Government from the employee by such methods as are provided by law for the recovery of amounts owed to the Federal Government; (D) the Secretary may waive, in whole or in part, a right of recovery under this subsection if it is shown that recovery would be contrary to the public interest; and (E) the Secretary shall make student loan payments under this section for the period of the agreement, subject to the availability of appropriations.
(2) REPAYMENTS.— (A) IN GENERAL.—Any amount repaid by, or recovered from, an individual under this subsection shall be credited to the appropriation account from which the amount in- volved was originally paid.

(B) MERGER.—Any amount credited under subpara- graph (A) shall be merged with other sums in such account and shall be available for the same purposes and period, and subject to the same limitations, if any, as the sums with which the amount was merged.
(3) LIMITATIONS.— (A) STUDENT LOAN PAYMENT AMOUNT.—Student loan repayments made by the Secretary under this section shall be made subject to such terms, limitations, or conditions as may be mutually agreed upon by the borrower and the Secretary in an agreement under paragraph (1), except that the amount paid by the Secretary under this section shall not exceed— (i) $6,000 for any borrower in any calendar year; or (ii) an aggregate total of $40,000 in the case of any borrower.
(B) BEGINNING OF PAYMENTS.—Nothing in this section shall authorize the Secretary to pay any amount to reim- burse a borrower for any repayments made by such bor- rower prior to the date on which the Secretary entered into an agreement with the borrower under this subsection.

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429 HIGHER EDUCATION ACT OF 1965 376 (1) IN GENERAL.—On completion of the required period of service under an agreement under subsection (d), the borrower and the Secretary may, subject to paragraph (2), enter into an additional agreement in accordance with subsection (d).

(2) TERM.—An agreement entered into under paragraph (1) may require the borrower to remain employed as a civil legal assistance attorney for less than three years.
(f) AWARD BASIS; PRIORITY.— (1) AWARD BASIS.—Subject to paragraph (2), the Secretary shall provide repayment benefits under this section on a first- come, first-served basis, and subject to the availability of ap- propriations.
(2) PRIORITY.—The Secretary shall give priority in pro- viding repayment benefits under this section in any fiscal year to a borrower who— (A) has practiced law for five years or less and, for not less than 90 percent of the time in such practice, has served as a civil legal assistance attorney; (B) received repayment benefits under this section during the preceding fiscal year; and (C) has completed less than three years of the first re- quired period of service specified for the borrower in an agreement entered into under subsection (d).
(g) INELIGIBILITY FOR DOUBLE BENEFITS.—No borrower may, for the same service, receive a reduction of loan obligations under both this section and section 428K or 455(m).

(h) REGULATIONS.—The Secretary is authorized to issue such regulations as may be necessary to carry out this section.

(i) AUTHORIZATION OF APPROPRIATIONS.—There are authorized to be appropriated to carry out this section $10,000,000 for fiscal year 2009 and such sums as may be necessary for each of the five succeeding fiscal years.

SEC.
SEC.

429. ø20 U.S.C.

1079¿ CERTIFICATE OF FEDERAL LOAN INSUR- ANCE—EFFECTIVE DATE OF INSURANCE.
(a) LOAN-BY-LOAN INSURANCE.— (1) AUTHORITY TO ISSUE CERTIFICATES ON APPLICATION.—If, upon application by an eligible lender, made upon such form, containing such information, and supported by such evidence as the Secretary may require, and otherwise in conformity with this section, the Secretary finds that the applicant has made a loan to an eligible student which is insurable under the pro- visions of this part, he may issue to the applicant a certificate of insurance covering the loan and setting forth the amount and terms of the insurance.
(2) EFFECTIVENESS OF CERTIFICATE.—Insurance evidenced by a certificate of insurance pursuant to subsection (a)(1) shall become effective upon the date of issuance of the certificate, ex- cept that the Secretary is authorized, in accordance with regu- lations, to issue commitments with respect to proposed loans, or with respect to lines (or proposed lines) of credit, submitted by eligible lenders, and in that event, upon compliance with subsection (a)(1) by the lender, the certificate of insurance may be issued effective as of the date when any loan, or any pay- ment by the lender pursuant to a line of credit, to be covered September 8, 2023 As Amended Through P.L.
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429 by such insurance was made.

Such insurance shall cease to be effective upon 60 days’ default by the lender in the payment of any installment of the premiums payable pursuant to sub- section (c).
(3) CONTENTS OF APPLICATIONS.—An application submitted pursuant to subsection (a)(1) shall contain (A) an agreement by the applicant to pay, in accordance with regulations, the pre- miums fixed by the Secretary pursuant to subsection (c), and (B) an agreement by the applicant that if the loan is covered by insurance the applicant will submit such supplementary re- ports and statement during the effective period of the loan agreement, upon such forms, at such times, and containing such information as the Secretary may prescribe by or pursu- ant to regulation.
(b) COMPREHENSIVE INSURANCE COVERAGE CERTIFICATE.— (1) ESTABLISHMENT OF SYSTEM BY REGULATION.—In lieu of requiring a separate insurance application and issuing a sepa- rate certificate of insurance for each student loan made by an eligible lender as provided in subsection (a), the Secretary may, in accordance with regulations consistent with section 424, issue to any eligible lender applying therefor a certificate of comprehensive insurance coverage which shall, without further action by the Secretary, insure all insurable loans made by that lender, on or after the date of the certificate and before a specified cutoff date, within the limits of an aggregate max- imum amount stated in the certificate.
Such regulations may provide for conditioning such insurance, with respect to any loan, upon compliance by the lender with such requirements (to be stated or incorporated by reference in the certificate) as in the Secretary’s judgment will best achieve the purpose of this subsection while protecting the United States from the risk of unreasonable loss and promoting the objectives of this part, including (but not limited to) provisions as to the report- ing of such loans and information relevant thereto to the Sec- retary and as to the payment of initial and other premiums and the effect of default therein, and including provision for confirmation by the Secretary from time to time (through en- dorsement of the certificate) of the coverage of specific new loans by such certificate, which confirmation shall be incontest- able by the Secretary in the absence of fraud or misrepresenta- tion of fact or patent error.
(2) UNCOVERED LOANS.—If the holder of a certificate of comprehensive insurance coverage issued under this subsection grants to a student a line of credit extending beyond the cutoff date specified in that certificate, loans or payments thereon made by the holder after that date pursuant to the line of cred- it shall not be deemed to be included in the coverage of that certificate except as may be specifically provided therein; but, subject to the limitations of section 424, the Secretary may, in accordance with regulations, make commitments to insure such future loans or payments, and such commitments may be hon- ored either as provided in subsection (a) or by inclusion of such insurance on comprehensive coverage under the subsection for September 8, 2023 As Amended Through P.L.
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430 HIGHER EDUCATION ACT OF 1965 378 the period or periods in which such future loans or payments are made.
(c) CHARGES FOR FEDERAL INSURANCE.—The Secretary shall, pursuant to regulations, charge for insurance on each loan under this part a premium in an amount not to exceed one-fourth of 1 percent per year of the unpaid principal amount of such loan (ex- cluding interest added to principal), payable in advance, at such times and in such manner as may be prescribed by the Secretary.
Such regulations may provide that such premium shall not be pay- able, or if paid shall be refundable, with respect to any period after default in the payment of principal or interest or after the borrower has died or becomes totally and permanently disabled, if (1) notice of such default or other event has been duly given, and (2) requests for payment of the loss insured against has been made or the Sec- retary has made such payment on his own motion pursuant to sec- tion 430(a).
(d) ASSIGNABILITY OF INSURANCE.—The rights of an eligible lender arising under insurance evidenced by a certificate of insur- ance issued to it under this section may be assigned as security by such lender only to another eligible lender, and subject to regula- tion by the Secretary.
(e) CONSOLIDATION NOT TO AFFECT INSURANCE.—The consoli- dation of the obligations of two or more federally insured loans ob- tained by a student borrower in any fiscal year into a single obliga- tion evidenced by a single instrument of indebtedness shall not af- fect the insurance by the United States.
If the loans thus consoli- dated are covered by separate certificates of insurance issued under subsection (a), the Secretary may upon surrender of the original certificates issue a new certificate of insurance in accordance with that subsection upon the consolidated obligation; if they are cov- ered by a single comprehensive certificate issued under subsection (b), the Secretary may amend that certificate accordingly.

SEC.

430. ø20 U.S.C.

1080¿ DEFAULT OF STUDENT UNDER FEDERAL LOAN INSURANCE PROGRAM.
(a) NOTICE TO SECRETARY AND PAYMENT OF LOSS.—Upon de- fault by the student borrower on any loan covered by Federal loan insurance pursuant to this part, and prior to the commencement of suit or other enforcement proceedings upon security for that loan, the insurance beneficiary shall promptly notify the Secretary, and the Secretary shall if requested (at that time or after further collec- tion efforts) by the beneficiary, or may on the Secretary’s own mo- tion, if the insurance is still in effect, pay to the beneficiary the amount of the loss sustained by the insured upon that loan as soon as that amount has been determined.
The ‘‘amount of the loss’’ on any loan shall, for the purposes of this subsection and subsection (b), be deemed to be an amount equal to the unpaid balance of the principal amount and accrued interest, including interest accruing from the date of submission of a valid default claim (as determined by the Secretary) to the date on which payment is authorized by the Secretary, reduced to the extent required by section 425(b).
Such beneficiary shall be required to meet the standards of due diligence in the collection of the loan and shall be required to sub- mit proof that the institution was contacted and other reasonable attempts were made to locate the borrower (when the location of September 8, 2023 As Amended Through P.L.
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430 the borrower is unknown) and proof that contact was made with the borrower (when the location is known).
The Secretary shall make the determination required to carry out the provisions of this section not later than 90 days after the notification by the insur- ance beneficiary and shall make payment in full on the amount of the beneficiary’s loss pending completion of the due diligence inves- tigation.
(b) EFFECT OF PAYMENT OF LOSS.—Upon payment of the amount of the loss pursuant to subsection (a), the United States shall be subrogated for all of the rights of the holder of the obliga- tion upon the insured loan and shall be entitled to an assignment of the note or other evidence of the insured loan by the insurance beneficiary.
If the net recovery made by the Secretary on a loan after deduction of the cost of that recovery (including reasonable administrative costs and collection costs, to the extent set forth in regulations issued by the Secretary) exceeds the amount of the loss, the excess shall be paid over to the insured.
The Secretary may, in attempting to make recovery on such loans, contract with pri- vate business concerns, State student loan insurance agencies, or State guaranty agencies, for payment for services rendered by such concerns or agencies in assisting the Secretary in making such re- covery.
Any contract under this subsection entered into by the Sec- retary shall provide that attempts to make recovery on such loans shall be fair and reasonable, and do not involve harassment, in- timidation, false or misleading representations, or unnecessary communications concerning the existence of any such loan to per- sons other than the student borrower.
(c) FORBEARANCE NOT PRECLUDED.—Nothing in this section or in this part shall be construed to preclude any forbearance for the benefit of the student borrower which may be agreed upon by the parties to the insured loan and approved by the Secretary, or to preclude forbearance by the Secretary in the enforcement of the in- sured obligation after payment on that insurance.
Any forbearance which is approved by the Secretary under this subsection with re- spect to the repayment of a loan, including a forbearance during default, shall not be considered as indicating that a holder of a fed- erally insured loan has failed to exercise reasonable care and due diligence in the collection of the loan.
(d) CARE AND DILIGENCE REQUIRED OF HOLDERS.—Nothing in this section or in this part shall be construed to excuse the holder of a federally insured loan from exercising reasonable care and dili- gence in the making and collection of loans under the provisions of this part.
If the Secretary, after a reasonable notice and oppor- tunity for hearing to an eligible lender, finds that it has substan- tially failed to exercise such care and diligence or to make the re- ports and statements required under section 428(a)(4) and section 429(a)(3), or to pay the required Federal loan insurance premiums, the Secretary shall disqualify that lender for further Federal insur- ance on loans granted pursuant to this part until the Secretary is satisfied that its failure has ceased and finds that there is reason- able assurance that the lender will in the future exercise necessary care and diligence or comply with such requirements, as the case may be.
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430A HIGHER EDUCATION ACT OF 1965 380 (e) DEFAULT RATE OF LENDERS, HOLDERS, AND GUARANTY AGENCIES.— (1) IN GENERAL.—The Secretary shall annually publish a list indicating the cohort default rate (determined in accord- ance with section 435(m)) for each originating lender, subse- quent holder, and guaranty agency participating in the pro- gram assisted under this part and an average cohort default rate for all institutions of higher education within each State.
(2) REGULATIONS.—The Secretary shall prescribe regula- tions designed to prevent an institution from evading the appli- cation to that institution of a cohort default rate through the use of such measures as branching, consolidation, change of ownership or control, or any similar device.
(3) RATE ESTABLISHMENT AND CORRECTION.—The Secretary shall establish a cohort default rate for lenders, holders, and guaranty agencies (determined consistent with section 435(m)), except that the rate for lenders, holders, and guaranty agencies shall not reflect any loans issued in accordance with section 428(j).The Secretary shall allow institutions, lenders, holders, and guaranty agencies the opportunity to correct such cohort default rate information.

SEC.

430A.

ø20 U.S.C.


1080A¿ REPORTS TO CONSUMER REPORTING AGENCIES AND INSTITUTIONS OF HIGHER EDUCATION.
(a) AGREEMENTS TO EXCHANGE INFORMATION.—For the pur- pose of promoting responsible repayment of loans covered by Fed- eral loan insurance pursuant to this part or covered by a guaranty agreement pursuant to section 428, the Secretary and each guar- anty agency, eligible lender, and subsequent holder shall enter into an agreement with each consumer reporting agency to exchange in- formation concerning student borrowers, in accordance with the re- quirements of this section.
For the purpose of assisting such con- sumer reporting agencies in complying with the Fair Credit Report- ing Act, such agreements may provide for timely response by the Secretary (concerning loans covered by Federal loan insurance) or by a guaranty agency, eligible lender, or subsequent holder (con- cerning loans covered by a guaranty agreement), or to requests from such consumer reporting agencies for responses to objections raised by borrowers.
Subject to the requirements of subsection (c), such agreements shall require the Secretary or the guaranty agen- cy, eligible lender, or subsequent holder, as appropriate, to disclose to such consumer reporting agencies, with respect to any loan under this part that has not been repaid by the borrower— (1) that the loan is an education loan (as such term is de- fined in section 151); (2) the total amount of loans made to any borrower under this part and the remaining balance of the loans; (3) information concerning the repayment status of the loan for inclusion in the file of the borrower, except that noth- ing in this subsection shall be construed to affect any other- wise applicable provision of the Fair Credit Reporting Act (15 U.S.C.
1681 et seq.

); (4) information concerning the date of any default on the loan and the collection of the loan, including information con- cerning the repayment status of any defaulted loan on which September 8, 2023 As Amended Through P.L.

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430A the Secretary has made a payment pursuant to section 430(a) or the guaranty agency has made a payment to the previous holder of the loan; and (5) the date of cancellation of the note upon completion of repayment by the borrower of the loan or payment by the Sec- retary pursuant to section 437.
(b) ADDITIONAL INFORMATION.—Such agreements may also pro- vide for the disclosure by such consumer reporting agencies to the Secretary or a guaranty agency, whichever insures or guarantees a loan, upon receipt of a notice under subsection (a)(4) that such a loan is in default, of information concerning the borrower’s loca- tion or other information which may assist the Secretary, the guar- anty agency, the eligible lender, or the subsequent holder in col- lecting the loan.
(c) CONTENTS OF AGREEMENTS.—Agreements entered into pur- suant to this section shall contain such provisions as may be nec- essary to ensure that— (1) no information is disclosed by the Secretary or the guaranty agency, eligible lender, or subsequent holder unless its accuracy and completeness have been verified and the Sec- retary or the guaranty agency has determined that disclosure would accomplish the purpose of this section; (2) as to any information so disclosed, such consumer re- porting agencies will be promptly notified of, and will promptly record, any change submitted by the Secretary, the guaranty agency, eligible lender, or subsequent holder with respect to such information, or any objections by the borrower with re- spect to any such information, as required by section 611 of the Fair Credit Reporting Act (15 U.S.C.
1681i); (3) no use will be made of any such information which would result in the use of collection practices with respect to such a borrower that are not fair and reasonable or that in- volve harassment, intimidation, false or misleading representa- tions, or unnecessary communication concerning the existence of such loan or concerning any such information; and (4) with regard to notices of default under subsection (a)(4) of this section, except for disclosures made to obtain the bor- rower’s location, the Secretary, or the guaranty agency, eligible lender, or subsequent holder whichever is applicable (A) shall not disclose any such information until the borrower has been notified that such information will be disclosed to consumer re- porting agencies unless the borrower enters into repayment of his or her loan, but (B) shall, if the borrower has not entered into repayment within a reasonable period of time, but not less than 30 days, from the date such notice has been sent to the borrower, disclose the information required by this subsection.
(d) CONTRACTOR STATUS OF PARTICIPANTS.—A guaranty agen- cy, eligible lender, or subsequent holder or consumer reporting agency which discloses or receives information under this section shall not be considered a Government contractor within the mean- ing of section 552a of title 5, United States Code.
(e) DISCLOSURE TO INSTITUTIONS.—The Secretary and each guaranty agency, eligible lender, and subsequent holder of a loan are authorized to disclose information described in subsections (a) September 8, 2023 As Amended Through P.L.

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431 HIGHER EDUCATION ACT OF 1965 382 and (b) concerning student borrowers to the eligible institutions such borrowers attend or previously attended.
To further the pur- pose of this section, an eligible institution may enter into an ar- rangement with any or all of the holders of delinquent loans made to borrowers who attend or previously attended such institution for the purpose of providing current information regarding the bor- rower’s location or employment or for the purpose of assisting the holder in contacting and influencing borrowers to avoid default.
(f) DURATION OF AUTHORITY.—Notwithstanding paragraphs (4) and (5) of subsection (a) of section 605 of the Fair Credit Reporting Act (15 U.S.C.
1681c (a)(4), (a)(5)), a consumer reporting agency may make a report containing information received from the Sec- retary or a guaranty agency, eligible lender, or subsequent holder regarding the status of a borrower’s defaulted account on a loan guaranteed under this part until— (1) 7 years from the date on which the Secretary or the agency paid a claim to the holder on the guaranty; (2) 7 years from the date the Secretary, guaranty agency, eligible lender, or subsequent holder first reported the account to the consumer reporting agency; or (3) in the case of a borrower who reenters repayment after defaulting on a loan and subsequently goes into default on such loan, 7 years from the date the loan entered default such subsequent time.
SEC.

431. ø20 U.S.C.

1081¿ INSURANCE FUND.

(a) ESTABLISHMENT.—There is hereby established a student loan insurance fund (hereinafter in this section called the ‘‘fund’’) which shall be available without fiscal year limitation to the Sec- retary for making payments in connection with the default of loans insured by the Secretary under this part, or in connection with payments under a guaranty agreement under section 428(c).
All amounts received by the Secretary as premium charges for insur- ance and as receipts, earnings, or proceeds derived from any claim or other assets acquired by the Secretary in connection with oper- ations under this part, any excess advances under section 422, and any other moneys, property, or assets derived by the Secretary from operations in connection with this section, shall be deposited in the fund.
All payments in connection with the default of loans insured by the Secretary under this part, or in connection with such guaranty agreements shall be paid from the fund.

Moneys in the fund not needed for current operations under this section may be invested in bonds or other obligations guaranteed as to principal and interest by the United States.
(b) BORROWING AUTHORITY.—If at any time the moneys in the fund are insufficient to make payments in connection with the de- fault of any loan insured by the Secretary under this part, or in connection with any guaranty agreement made under section 428(c), the Secretary is authorized, to the extent provided in ad- vance by appropriations Acts, to issue to the Secretary of the Treasury notes or other obligations in such forms and denomina- tions, bearing such maturities, and subject to such terms and con- ditions as may be prescribed by the Secretary with the approval of the Secretary of the Treasury.
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432 bear interest at a rate determined by the Secretary of the Treas- ury, taking into consideration the current average market yield on outstanding marketable obligations of the United States of com- parable maturities during the month preceding the issuance of the notes or other obligations.
The Secretary of the Treasury is author- ized and directed to purchase any notes and other obligations issued hereunder and for that purpose is authorized to use as a public debt transaction the proceeds from the sale of any securities issued under the Second Liberty Bond Act, as amended, and the purposes for which securities may be issued under that Act, as amended, are extended to include any purchase of such notes and obligations.
The Secretary of the Treasury may at any time sell any of the notes or other obligations acquired under this subsection.

All redemptions, purchases, and sales by the Secretary of the Treasury of such notes or other obligations shall be treated as public debt transactions of the United States.

Sums borrowed under the sub- section shall be deposited in the fund and redemption of such notes and obligations shall be made by the Secretary from such fund.

SEC.

432. ø20 U.S.C.


1082¿ LEGAL POWERS AND RESPONSIBILITIES.
(a) GENERAL POWERS.—In the performance of, and with respect to, the functions, powers, and duties, vested in him by this part, the Secretary may— (1) prescribe such regulations as may be necessary to carry out the purposes of this part, including regulations applicable to third party servicers (including regulations concerning fi- nancial responsibility standards for, and the assessment of li- abilities for program violations against, such servicers) to es- tablish minimum standards with respect to sound management and accountability of programs under this part, except that in no case shall damages be assessed against the United States for the actions or inactions of such servicers; (2) sue and be sued in any court of record of a State hav- ing general jurisdiction or in any district court of the United States, and such district courts shall have jurisdiction of civil actions arising under this part without regard to the amount in controversy, and action instituted under this subsection by or against the Secretary shall survive notwithstanding any change in the person occupying the office of Secretary or any vacancy in that office; but no attachment, injunction, garnish- ment, or other similar process, mesne or final, shall be issued against the Secretary or property under the Secretary’s control and nothing herein shall be construed to except litigation aris- ing out of activities under this part from the application of sec- tions 509, 517, 547, and 2679 of title 28 of the United States Code; (3) include in any contract for Federal loan insurance such terms, conditions, and covenants relating to repayment of prin- cipal and payment of interest, relating to the Secretary’s obli- gations and rights to those of eligible lenders, and borrowers in case of default, and relating to such other matters as the Secretary determines to be necessary to assure that the pur- poses of this part will be achieved; and any term, condition, and covenant made pursuant to this paragraph or pursuant to September 8, 2023 As Amended Through P.L.
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432 HIGHER EDUCATION ACT OF 1965 384 any other provision of this part may be modified by the Sec- retary, after notice and opportunity for a hearing, if the Sec- retary finds that the modification is necessary to protect the United States from the risk of unreasonable loss; (4) subject to the specific limitations in this part, consent to modification, with respect to rate of interest, time of pay- ment of any installment of principal and interest or any por- tion thereof, or any other provision of any note or other instru- ment evidencing a loan which has been insured by the Sec- retary under this part; (5) enforce, pay, or compromise, any claim on, or arising because of, any such insurance or any guaranty agreement under section 428(c); and (6) enforce, pay, compromise, waive, or release any right, title, claim, lien, or demand, however acquired, including any equity or any right of redemption.
(b) FINANCIAL OPERATIONS RESPONSIBILITIES.—The Secretary shall, with respect to the financial operations arising by reason of this part prepare annually and submit a budget program as pro- vided for wholly owned Government corporations by chapter 91 of title 31, United States Code.
The transactions of the Secretary, in- cluding the settlement of insurance claims and of claims for pay- ments pursuant to section 428, and transactions related thereto and vouchers approved by the Secretary in connection with such transactions, shall be final and conclusive upon all accounting and other officers of the Government.
The Secretary may not enter into any settlement of any claim under this title that exceeds $1,000,000 unless— (1) the Secretary requests a review of the proposed settle- ment of such claim by the Attorney General; and (2) the Attorney General responds to such request, which may include, at the Attorney General’s discretion, a written opinion related to such proposed settlement.
(c) DATA COLLECTION.— (1) COLLECTION BY CATEGORY OF LOAN.—(A) For loans in- sured after December 31, 1976, or in the case of each insurer after such earlier date where the data required by this sub- section are available, the Secretary and all other insurers under this part shall collect and accumulate all data relating to (i) loan volume insured and (ii) defaults reimbursed or de- fault rates according to the categories of loans listed in sub- paragraph (B) of this paragraph.
(B) The data indicated in subparagraph (A) of this para- graph shall be accumulated according to the category of lender making the loan and shall be accumulated separately for lend- ers who are (i) eligible institutions, (ii) State or private, non- profit direct lenders, (iii) commercial financial institutions who are banks, savings and loan associations, or credit unions, and (iv) all other types of institutions or agencies.
(C) The Secretary may designate such additional subcat- egories within the categories specified in subparagraph (B) of this paragraph as the Secretary deems appropriate.

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432 (D) The category or designation of a loan shall not be changed for any reason, including its purchase or acquisition by a lender of another category.
(2) COLLECTION AND REPORTING REQUIREMENTS.—(A) The Secretary shall collect data under this subsection from all in- surers under this part and shall publish not less often than once every fiscal year a report showing loan volume guaran- teed and default data for each category specified in subpara- graph (B) of paragraph (1) of this subsection and for the total of all lenders.
(B) The reports specified in subparagraph (A) of this para- graph shall include a separate report for each insurer under this part including the Secretary, and where an insurer insures loans for lenders in more than one State, such insurer’s report shall list all data separately for each State.
(3) INSTITUTIONAL, PUBLIC, OR NONPROFIT LENDERS.—For purposes of clarity in communications, the Secretary shall sep- arately identify loans made by the lenders referred to in clause (i) and loans made by the lenders referred to in clause (ii) of paragraph (1)(B) of this subsection.

(d) DELEGATION.— (1) REGIONAL OFFICES.—The functions of the Secretary under this part listed in paragraph (2) of this subsection may be delegated to employees in the regional office of the Depart- ment.
(2) DELEGABLE FUNCTIONS.—The functions which may be delegated pursuant to this subsection are— (A) reviewing applications for loan insurance under section 429 and issuing contracts for Federal loan insur- ance, certificates of insurance, and certificates of com- prehensive insurance coverage to eligible lenders which are financial or credit institutions subject to examination and supervision by an agency of the United States or of any State; (B) receiving claims for payments under section 430(a), examining those claims, and pursuant to regula- tions of the Secretary, approving claims for payment, or re- quiring lenders to take additional collection action as a condition for payment of claims; and (C) certifying to the central office when collection of defaulted loans has been completed, compromising or agreeing to the modification of any Federal claim against a borrower (pursuant to regulations of the Secretary issued under section 432(a)), and recommending litigation with respect to any such claim.
(e) USE OF INFORMATION ON BORROWERS.—Notwithstanding any other provision of law, the Secretary may provide to eligible lenders, and to any guaranty agency having a guaranty agreement under section 428(c)(1), any information with respect to the names and addresses of borrowers or other relevant information which is available to the Secretary, from whatever source such information may be derived.

(f) AUDIT OF FINANCIAL TRANSACTIONS.— September 8, 2023 As Amended Through P.L.
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432 HIGHER EDUCATION ACT OF 1965 386 (1) COMPTROLLER GENERAL AND INSPECTOR GENERAL AU- THORITY.—The Comptroller General and the Inspector General of the Department of Education shall each have the authority to conduct an audit of the financial transactions of— (A) any guaranty agency operating under an agree- ment with the Secretary pursuant to section 428(b); (B) any eligible lender as defined in section 435(d)(1); and (C) a representative sample of eligible lenders under this part, upon the request of either of the authorizing committees, with respect to the payment of the special al- lowance under section 438 in order to evaluate the pro- gram authorized by this part.
(2) ACCESS TO RECORDS.—For the purpose of carrying out this subsection, the records of any entity described in subpara- graph (A), (B), (C), or (D) of paragraph (1) shall be available to the Comptroller General and the Inspector General of the Department of Education.
For the purpose of section 716(c) of title 31, United States Code, such records shall be considered to be records to which the Comptroller General has access by law, and for the purpose of section 406(a)(4) of title 5, United States Code, such records shall be considered to be records nec- essary in the performance of functions assigned by chapter 4 of title 5, United States Code, to the Inspector General.
(3) DEFINITION OF RECORDS.—For the purpose of this sub- section, the term ‘‘record’’ includes any information, document, report, answer, account, paper, or other data or documentary evidence.
(4) AUDIT PROCEDURES.—In conducting audits pursuant to this subsection, the Comptroller General and the Inspector General of the Department of Education shall audit the records to determine the extent to which they, at a minimum, comply with Federal statutes, and rules and regulations prescribed by the Secretary, in effect at the time that the record was made, and in no case shall the Comptroller General or the Inspector General apply subsequently determined standards, procedures, or regulations to the records of such agency, lender, or Author- ity.
(g) CIVIL PENALTIES.— (1) AUTHORITY TO IMPOSE PENALTIES.—Upon determina- tion, after reasonable notice and opportunity for a hearing, that a lender or a guaranty agency— (A) has violated or failed to carry out any provision of this part or any regulation prescribed under this part, or (B) has engaged in substantial misrepresentation of the nature of its financial charges, the Secretary may impose a civil penalty upon such lender or agency of not to exceed $25,000 for each violation, failure, or misrepresentation.
(2) LIMITATIONS.—No civil penalty may be imposed under paragraph (1) of this subsection unless the Secretary deter- mines that— September 8, 2023 As Amended Through P.L.

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432 (A) the violation, failure, or substantial misrepresenta- tion referred to in that paragraph resulted from a viola- tion, failure, or misrepresentation that is material; and (B) the lender or guaranty agency knew or should have known that its actions violated or failed to carry out the provisions of this part or the regulations thereunder.
(3) CORRECTION OF FAILURE.—A lender or guaranty agency has no liability under paragraph (1) of this subsection if, prior to the notification by the Secretary under that paragraph, the lender or guaranty agency cures or corrects the violation or failure or notifies the person who received the substantial mis- representation of the actual nature of the financial charges in- volved.
(4) CONSIDERATION AS SINGLE VIOLATION.—For the purpose of paragraph (1) of this subsection, violations, failures, or sub- stantial misrepresentations arising from a specific practice of a lender or guaranty agency, and occurring prior to notification by the Secretary under that paragraph, shall be deemed to be a single violation, failure, or substantial misrepresentation even if the violation, failure, or substantial misrepresentation affects more than one loan or more than one borrower, or both.
The Secretary may only impose a single civil penalty for each such violation, failure, or substantial misrepresentation.
(5) ASSIGNEES NOT LIABLE FOR VIOLATIONS BY OTHERS.—If a loan affected by a violation, failure, or substantial misrepre- sentation is assigned to another holder, the lender or guaranty agency responsible for the violation, failure, or substantial mis- representation shall remain liable for any civil money penalty provided for under paragraph (1) of this subsection, but the as- signee shall not be liable for any such civil money penalty.
(6) COMPROMISE.—Until a matter is referred to the Attor- ney General, any civil penalty under paragraph (1) of this sub- section may be compromised by the Secretary.
In determining the amount of such penalty, or the amount agreed upon in compromise, the Secretary shall consider the appropriateness of the penalty to the resources of the lender or guaranty agen- cy subject to the determination; the gravity of the violation, failure, or substantial misrepresentation; the frequency and persistence of the violation, failure, or substantial misrepresen- tation; and the amount of any losses resulting from the viola- tion, failure, or substantial misrepresentation.
The amount of such penalty, when finally determined, or the amount agreed upon in compromise, may be deducted from any sums owing by the United States to the lender or agency charged, unless the lender or agency has, in the case of a final agency determina- tion, commenced proceedings for judicial review within 90 days of the determination, in which case the deduction may not be made during the pendency of the proceeding.
(h) AUTHORITY OF THE SECRETARY TO IMPOSE AND ENFORCE LIMITATIONS, SUSPENSIONS, AND TERMINATIONS.— (1) IMPOSITION OF SANCTIONS.—(A) If the Secretary, after a reasonable notice and opportunity for hearing to an eligible lender, finds that the eligible lender— (i) has substantially failed— September 8, 2023 As Amended Through P.L.
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432 HIGHER EDUCATION ACT OF 1965 388 (I) to exercise reasonable care and diligence in the making and collecting of loans under the provisions of this part, (II) to make the reports or statements under sec- (III) to pay the required loan insurance premiums tion 428(a)(4), or to any guaranty agency, or (ii) has engaged in— (I) fraudulent or misleading advertising or in so- licitations that have resulted in the making of loans insured or guaranteed under this part to borrowers who are ineligible; or (II) the practice of making loans that violate the certification for eligibility provided in section 428, the Secretary shall limit, suspend, or terminate that lender from participation in the insurance programs operated by guar- anty agencies under this part.
(B) The Secretary shall not lift any such limitation, sus- pension, or termination until the Secretary is satisfied that the lender’s failure under subparagraph (A)(i) of this paragraph or practice under subparagraph (A)(ii) of this paragraph has ceased and finds that there are reasonable assurances that the lender will— (i) exercise the necessary care and diligence, (ii) comply with the requirements described in sub- paragraph (A)(i), or (iii) cease to engage in the practices described in sub- paragraph (A)(ii), as the case may be.
(2) REVIEW OF SANCTIONS ON LENDERS.—(A) The Secretary shall review each limitation, suspension, or termination im- posed by any guaranty agency pursuant to section 428(b)(1)(U) within 60 days after receipt by the Secretary of a notice from the guaranty agency of the imposition of such limitation, sus- pension, or termination, unless the right to such review is waived in writing by the lender.
The Secretary shall uphold the imposition of such limitation, suspension, or termination in the student loan insurance program of each of the guaranty agencies under this part, and shall notify such guaranty agen- cies of such sanction— (i) if such review is waived; or (ii) if such review is not waived, unless the Secretary determines that the limitation, suspension, or termination was not imposed in accordance with requirements of such section.
(B) The Secretary’s review under this paragraph of the limitation, suspension, or termination imposed by a guaranty agency pursuant to section 428(b)(1)(U) shall be limited to— (i) a review of the written record of the proceedings in which the guaranty agency imposed such sanctions; and (ii) a determination as to whether the guaranty agency complied with section 428(b)(1)(U) and any notice and hearing requirements prescribed in regulations of the Sec- retary under this part.
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432 (C) The Secretary shall not lift any such sanction until the Secretary is satisfied that the lender has corrected the failures which led to the limitation, suspension, or termination, and finds that there are reasonable assurances that the lender will, in the future, comply with the requirements of this part.

The Secretary shall notify each guaranty agency of the lifting of any such sanction.
(3) REVIEW OF SANCTIONS ON ELIGIBLE INSTITUTIONS.—(A) The Secretary shall review each limitation, suspension, or ter- mination imposed by any guaranty agency pursuant to section 428(b)(1)(T) within 60 days after receipt by the Secretary of a notice from the guaranty of the imposition of such limitation, suspension, or termination, unless the right to such review is waived in writing by the institution.
The Secretary shall up- hold the imposition of such limitation, suspension, or termi- nation in the student loan insurance program of each of the guaranty agencies under this part, and shall notify such guar- anty agencies of such sanctions— (i) if such review is waived; or (ii) if such review is not waived, unless the Secretary determines that the limitation, suspension, or termination was not imposed in accordance with requirements of such section.
(B) The Secretary’s review under this paragraph of the limitation, suspension, or termination imposed by a guaranty agency pursuant to section 428(b)(1)(T) shall be limited to— (i) a review of the written record of the proceedings in which the guaranty agency imposed such sanctions; and (ii) a determination as to whether the guaranty agency complied with section 428(b)(1)(T) and any notice and hearing requirements prescribed in regulations of the Sec- retary under this part.
(C) The Secretary shall not lift any such sanction until the Secretary is satisfied that the institution has corrected the fail- ures which led to the limitation, suspension, or termination, and finds that there are reasonable assurances that the insti- tution will, in the future, comply with the requirements of this part.

The Secretary shall notify each guaranty agency of the lifting of any such sanction.
(i) AUTHORITY TO SELL DEFAULTED LOANS.—In the event that all other collection efforts have failed, the Secretary is authorized to sell defaulted student loans assigned to the United States under this part to collection agencies, eligible lenders, guaranty agencies, or other qualified purchaser on such terms as the Secretary deter- mines are in the best financial interests of the United States.

A loan may not be sold pursuant to this subsection if such loan is in repayment status.
(j) AUTHORITY OF THE SECRETARY TO TAKE EMERGENCY AC- TIONS AGAINST LENDERS.— (1) IMPOSITION OF SANCTIONS.—If the Secretary— (A) receives information, determined by the Secretary to be reliable, that a lender is violating any provision of this title, any regulation prescribed under this title, or any applicable special arrangement, agreement, or limitation; September 8, 2023 As Amended Through P.L.
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432 HIGHER EDUCATION ACT OF 1965 390 (B) determines that immediate action is necessary to prevent misuse of Federal funds; and (C) determines that the likelihood of loss outweighs the importance of following the limitation, suspension, or termination procedures authorized in subsection (h); the Secretary shall, effective on the date on which a notice and statement of the basis of the action is mailed to the lender (by registered mail, return receipt requested), take emergency ac- tion to stop the issuance of guarantee commitments and the payment of interest benefits and special allowance to the lend- er.
(2) LENGTH OF EMERGENCY ACTION.—An emergency action under this subsection may not exceed 30 days unless a limita- tion, suspension, or termination proceeding is initiated against the lender under subsection (h) before the expiration of that period.

(3) OPPORTUNITY TO SHOW CAUSE.—The Secretary shall provide the lender, if it so requests, an opportunity to show cause that the emergency action is unwarranted.
(k) PROGRAM OF ASSISTANCE FOR BORROWERS.— (1) IN GENERAL.—The Secretary shall undertake a program to encourage corporations and other private and public employ- ers, including the Federal Government, to assist borrowers in repaying loans received under this title, including providing employers with options for payroll deduction of loan payments and offering loan repayment matching provisions as part of employee benefit packages.
(2) PUBLICATION.—The Secretary shall publicize models for providing the repayment assistance described in paragraph (1) and each year select entities that deserve recognition, through means devised by the Secretary, for the development of innova- tive plans for providing such assistance to employees.

(3) RECOMMENDATION.—The Secretary shall recommend to the appropriate committees in the Senate and House of Rep- resentatives changes to statutes that could be made in order to further encourage such efforts.
(l) UNIFORM ADMINISTRATIVE AND CLAIMS PROCEDURES.— (1) IN GENERAL.—The Secretary shall, by regulation devel- oped in consultation with guaranty agencies, lenders, institu- tions of higher education, secondary markets, students, third party servicers and other organizations involved in providing loans under this part, prescribe standardized forms and proce- dures regarding— (A) origination of loans; (B) electronic funds transfer; (C) guaranty of loans; (D) deferments; (E) forbearance; (F) servicing; (G) claims filing; (H) borrower status change and anticipated gradua- tion date; and (I) cures.
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432 (2) SPECIAL RULES.—(A) The forms and procedures de- scribed in paragraph (1) shall include all aspects of the loan process as such process involves eligible lenders and guaranty agencies and shall be designed to minimize administrative costs and burdens (other than the costs and burdens involved in the transition to new forms and procedures) involved in ex- changes of data to and from borrowers, schools, lenders, sec- ondary markets, and the Department.
(B) Nothing in this paragraph shall be construed to limit the development of electronic forms and procedures.
(3) SIMPLIFICATION REQUIREMENTS.—Such regulations shall include— (A) standardization of computer formats, forms design, and guaranty agency procedures relating to the origina- tion, servicing, and collection of loans made under this part; (B) authorization of alternate means of document re- tention, including the use of microfilm, microfiche, laser disc, compact disc, and other methods allowing the produc- tion of a facsimile of the original documents; (C) authorization of the use of computer or similar electronic methods of maintaining records relating to the performance of servicing, collection, and other regulatory requirements under this Act; and (D) authorization and implementation of electronic data linkages for the exchange of information to and from lenders, guarantors, institutions of higher education, third party servicers, and the Department of Education for stu- dent status confirmation reports, claim filing, interest and special allowance billing, deferment processing, and all other administrative steps relating to loans made pursuant to this part where using electronic data linkage is feasible.
(4) ADDITIONAL RECOMMENDATIONS.—The Secretary shall review regulations prescribed pursuant to paragraph (1) and seek additional recommendations from guaranty agencies, lenders, institutions of higher education, students, secondary markets, third party servicers and other organizations involved in providing loans under this part, not less frequently than an- nually, for additional methods of simplifying and standardizing the administration of the programs authorized by this part.
(m) COMMON FORMS AND FORMATS.— (1) COMMON GUARANTEED STUDENT LOAN APPLICATION FORM AND PROMISSORY NOTE.— (A) IN GENERAL.—The Secretary, in cooperation with representatives of guaranty agencies, eligible lenders, and organizations involved in student financial assistance, shall prescribe common application forms and promissory notes, or master promissory notes, to be used for applying for loans under part B of this title.
(B) REQUIREMENTS.—The forms prescribed by the Sec- retary shall— (i) use clear, concise, and simple language to facili- tate understanding of loan terms and conditions by ap- plicants; and September 8, 2023 As Amended Through P.L.

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432 HIGHER EDUCATION ACT OF 1965 392 (ii) be formatted to require the applicant to clearly indicate a choice of lender.

(C) FREE APPLICATION FORM.—For academic year 1999–2000 and succeeding academic years, the Secretary shall prescribe the form developed under section 483 as the application form under this part, other than for loans under sections 428B and 428C.
(D) MASTER PROMISSORY NOTE.— (i) IN GENERAL.—The Secretary shall develop and require the use of master promissory note forms for loans made under this part and part D. Such forms shall be available for periods of enrollment beginning not later than July 1, 2000.

Each form shall allow eli- gible borrowers to receive, in addition to initial loans, additional loans for the same or subsequent periods of enrollment through a student confirmation process ap- proved by the Secretary.
Such forms shall be used for loans made under this part or part D as directed by the Secretary.
Unless otherwise notified by the Sec- retary, each institution of higher education that par- ticipates in the program under this part or part D may use a master promissory note for loans under this part and part D. (ii) CONSULTATION.—In developing the master promissory note under this subsection, the Secretary shall consult with representatives of guaranty agen- cies, eligible lenders, institutions of higher education, students, and organizations involved in student finan- cial assistance.
(iii) SALE; ASSIGNMENT; ENFORCEABILITY.—Not- withstanding any other provision of law, each loan made under a master promissory note under this sub- section may be sold or assigned independently of any other loan made under the same promissory note and each such loan shall be separately enforceable in all Federal and State courts on the basis of an original or copy of the master promissory note in accordance with the terms of the master promissory note.
(E) PERFECTION OF SECURITY INTERESTS IN STUDENT LOANS.— (i) IN GENERAL.—Notwithstanding the provisions of any State law to the contrary, including the Uni- form Commercial Code as in effect in any State, a se- curity interest in loans made under this part, on be- half of any eligible lender (as defined in section 435(d)) shall attach, be perfected, and be assigned priority in the manner provided by the applicable State’s law for perfection of security interests in accounts, as such law may be amended from time to time (including ap- plicable transition provisions).
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432 with the applicable statutory provisions that created such a statutory lien.
(ii) COLLATERAL DESCRIPTION.—In addition to any other method for describing collateral in a legally suf- ficient manner permitted under the laws of the State, the description of collateral in any financing statement filed pursuant to this subparagraph shall be deemed legally sufficient if it lists such loans, or refers to records (identifying such loans) retained by the se- cured party or any designee of the secured party iden- tified in such financing statement, including the debt- or or any loan servicer.
(iii) SALES.—Notwithstanding clauses (i) and (ii) and any provisions of any State law to the contrary, other than any such State’s law providing for creation of a statutory lien, an outright sale of loans made under this part shall be effective and perfected auto- matically upon attachment as defined in the Uniform Commercial Code of such State.
(2) COMMON DEFERMENT FORM.—The Secretary, in coopera- tion with representatives of guaranty agencies, institutions of higher education, and lenders involved in loans made under part B of this title, shall prescribe a common deferment report- ing form to be used for the processing of deferments of loans made under this title.
(3) COMMON REPORTING FORMATS.—The Secretary shall promulgate standards including necessary rules, regulations (including the definitions of all relevant terms), and procedures so as to require all lenders and guaranty agencies to report in- formation on all aspects of loans made under this part in uni- form formats, so as to permit the direct comparison of data submitted by individual lenders, servicers, or guaranty agen- cies.
(4) ELECTRONIC FORMS.—Nothing in this section shall be construed to limit the development and use of electronic forms and procedures.

(n) DEFAULT REDUCTION MANAGEMENT.— (1) AUTHORIZATION.—There are authorized to be appro- priated $25,000,000 for fiscal year 1999 and each of the four succeeding fiscal years, for the Secretary to expend for default reduction management activities for the purposes of estab- lishing a performance measure that will reduce defaults by 5 percent relative to the prior fiscal year.
Such funds shall be in addition to, and not in lieu of, other appropriations made for such purposes.

(2) ALLOWABLE ACTIVITIES.—Allowable activities for which such funds shall be expended by the Secretary shall include the following: (A) program reviews; (B) audits; (C) debt man- agement programs; (D) training activities; and (E) such other management improvement activities approved by the Sec- retary.
(3) PLAN FOR USE REQUIRED.—The Secretary shall submit a plan, for inclusion in the materials accompanying the Presi- dent’s budget each fiscal year, detailing the expenditure of September 8, 2023 As Amended Through P.L.

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433 HIGHER EDUCATION ACT OF 1965 394 funds authorized by this section to accomplish the 5 percent re- duction in defaults.

At the conclusion of the fiscal year, the Secretary shall report the Secretary’s findings and activities concerning the expenditure of funds and whether the perform- ance measure was met.
If the performance measure was not met, the Secretary shall report the following: (A) why the goal was not met, including an indication of any managerial deficiencies or of any legal obstacles; (B) plans and a schedule for achieving the established performance goal; (C) recommended legislative or regulatory changes necessary to achieve the goal; and (D) if the performance standard or goal is impractical or infeasible, why that is the case and what action is rec- ommended, including whether the goal should be changed or the program altered or eliminated.
This report shall be submitted to the Appropriations Commit- tees of the House of Representatives and the Senate and to the authorizing committees.
(o) CONSEQUENCES OF GUARANTY AGENCY INSOLVENCY.—In the event that the Secretary has determined that a guaranty agency is unable to meet its insurance obligations under this part, the holder of loans insured by the guaranty agency may submit insurance claims directly to the Secretary and the Secretary shall pay to the holder the full insurance obligation of the guaranty agency, in ac- cordance with insurance requirements no more stringent than those of the guaranty agency.
Such arrangements shall continue until the Secretary is satisfied that the insurance obligations have been transferred to another guarantor who can meet those obliga- tions or a successor will assume the outstanding insurance obliga- tions.
(p) REPORTING REQUIREMENT.—All officers and directors, and those employees and paid consultants of eligible institutions, eligi- ble lenders, guaranty agencies, loan servicing agencies, accrediting agencies or associations, State licensing agencies or boards, and en- tities acting as secondary markets (including the Student Loan Marketing Association), who are engaged in making decisions as to the administration of any program or funds under this title or as to the eligibility of any entity or individual to participate under this title, shall report to the Secretary, in such manner and at such time as the Secretary shall require, on any financial interest which such individual may hold in any other entity participating in any program assisted under this title.
SEC.

433. ø20 U.S.C.

1083¿ STUDENT LOAN INFORMATION BY ELIGIBLE LENDERS.

(a) REQUIRED DISCLOSURE BEFORE DISBURSEMENT.—Each eligi- ble lender, at or prior to the time such lender disburses a loan that is insured or guaranteed under this part (other than a loan made under section 428C), shall provide thorough and accurate loan in- formation on such loan to the borrower in simple and understand- able terms.
Any disclosure required by this subsection may be made by an eligible lender by written or electronic means, includ- ing as part of the application material provided to the borrower, as part of the promissory note evidencing the loan, or on a separate September 8, 2023 As Amended Through P.L.
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433 written form provided to the borrower.

Each lender shall provide to each borrower a telephone number, and may provide an elec- tronic address, through which additional loan information can be obtained.
The disclosure shall include— (1) a statement prominently and clearly displayed and in bold print that the borrower is receiving a loan that must be repaid; (2) the name of the eligible lender, and the address to which communications and payments should be sent; (3) the principal amount of the loan; (4) the amount of any charges, such as the origination fee and Federal default fee, and whether those fees will be— (A) collected by the lender at or prior to the disbursal of the loan; (B) deducted from the proceeds of the loan; (C) paid separately by the borrower; or (D) paid by the lender; (5) the stated interest rate on the loan; (6) for loans made under section 428H or to a student bor- rower under section 428B, an explanation— (A) that the borrower has the option to pay the inter- est that accrues on the loan while the borrower is a stu- dent at an institution of higher education; and (B) if the borrower does not pay such interest while at- tending an institution, when and how often interest on the loan will be capitalized; (7) for loans made to a parent borrower on behalf of a stu- dent under section 428B, an explanation— (A) that the parent has the option to defer payment on the loan while the student is enrolled on at least a half- time basis in an institution of higher education; (B) if the parent does not pay the interest on the loan while the student is enrolled in an institution, when and how often interest on the loan will be capitalized; and (C) that the parent may be eligible for a deferment on the loan if the parent is enrolled on at least a half-time basis in an institution of higher education; (8) the yearly and cumulative maximum amounts that may be borrowed; (9) a statement of the total cumulative balance, including the loan being disbursed, owed by the borrower to that lender, and an estimate of the projected monthly payment, given such cumulative balance; (10) an explanation of when repayment of the loan will be required and when the borrower will be obligated to pay inter- est that accrues on
 the loan; (11) a description of the types of repayment plans that are available for the loan; (12) a statement as to the minimum and maximum repay- ment terms which the lender may impose, and the minimum annual payment required by law; (13) an explanation of any special options the borrower may have for loan consolidation or other refinancing of the loan; September 8, 2023 As Amended Through P.L.
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433 HIGHER EDUCATION ACT OF 1965 396 (14) a statement that the borrower has the right to prepay all or part of the loan, at any time, without penalty; (15) a statement summarizing circumstances in which re- payment of the loan or interest that accrues on the loan may be deferred; (16) a statement summarizing the circumstances in which a borrower may obtain forbearance on the loan; (17) a description of the options available for forgiveness of the loan, and the requirements to obtain loan forgiveness; (18) a definition of default and the consequences to the borrower if the borrower defaults, including a statement that the default will be reported to a consumer reporting agency; and (19) an explanation of any cost the borrower may incur during repayment or in the collection of the loan, including fees that the borrower may be charged, such as late payment fees and collection costs.
(b) REQUIRED DISCLOSURE BEFORE REPAYMENT.—Each eligible lender shall, at or prior to the start of the repayment period on a loan made, insured, or guaranteed under section 428, 428B, or 428H, disclose to the borrower by written or electronic means the information required under this subsection in simple and under- standable terms.

Each eligible lender shall provide to each bor- rower a telephone number, and may provide an electronic address, through which additional loan information can be obtained.
The disclosure required by this subsection shall be made not less than 30 days nor more than 150 days before the first payment on the loan is due from the borrower.
The disclosure shall include— (1) the name of the eligible lender or loan servicer, and the address to which communications and payments should be sent; (2) the scheduled date upon which the repayment period is to begin or the deferment period under section 428B(d)(1) is to end, as applicable; (3) the estimated balance owed by the borrower on the loan or loans covered by the disclosure (including, if applicable, the estimated amount of interest to be capitalized) as of the scheduled date on which the repayment period is to begin or the deferment period under 428B(d)(1) is to end, as applicable; (4) the stated interest rate on the loan or loans, or the combined interest rate of loans with different stated interest rates; (5) information on loan repayment benefits offered for the loan or loans, including— (A) whether the lender offers any benefits that are contingent on the repayment behavior of the borrower, such as— (i) a reduction in interest rate if the borrower re- pays the loan by automatic payroll or checking account deduction; (ii) a reduction in interest rate if the borrower makes a specified number of on-time payments; and (iii) other loan repayment benefits for which the borrower could be eligible that would reduce the September 8, 2023 As Amended Through P.L.
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433 amount of repayment or the length of the repayment period; (B) if the lender provides a loan repayment benefit— (i) any limitations on such benefit; (ii) explicit information on the reasons a borrower may lose eligibility for such benefit; (iii) for a loan repayment benefit that reduces the borrower’s interest rate— (I) examples of the impact the interest rate reduction would have on the length of the bor- rower’s repayment period and the amount of re- payment; and (II) upon the request of the borrower, the ef- fect the reduction in interest rate would have with respect to the borrower’s payoff amount and time for repayment; and (iv) whether and how the borrower can regain eli- gibility for a benefit if a borrower loses a benefit; (6) a description of all the repayment plans that are avail- able to the borrower and a statement that the borrower may change from one plan to another during the period of repay- ment; (7) the repayment schedule for all loans covered by the dis- closure, including— (A) the date the first installment is due; and (B) the number, amount, and frequency of required payments, which shall be based on a standard repayment plan or, in the case of a borrower who has selected another repayment plan, on the repayment plan selected by the borrower; (8) an explanation of any special options the borrower may have for loan consolidation or other refinancing of the loan and of the availability and terms of such other options; (9) except as provided in subsection (d)— (A) the projected total of interest charges which the borrower will pay on the loan or loans, assuming that the borrower makes payments exactly in accordance with the repayment schedule; and (B) if the borrower has already paid interest on the loan or loans, the amount of interest paid; (10) the nature of any fees which may accrue or be charged to the borrower during the repayment period; (11) a statement that the borrower has the right to prepay all or part of the loan or loans covered by the disclosure at any time without penalty; (12) a description of the options by which the borrower may avoid or be removed from default, including any relevant fees associated with such options; and (13) additional resources, including nonprofit organiza- tions, advocates, and counselors (including the Student Loan Ombudsman of the Department) of which the lender is aware, where borrowers may receive advice and assistance on loan re- payment.
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433 HIGHER EDUCATION ACT OF 1965 398 (c) SEPARATE NOTIFICATION.—Each eligible lender shall, at the time such lender notifies a borrower of approval of a loan which is insured or guaranteed under this part, provide the borrower with a separate notification which summarizes, in simple and under- standable terms, the rights and responsibilities of the borrower with respect to the loan, including a statement of the consequences of defaulting on the loan and a statement that each borrower who defaults will be reported to a consumer reporting agency.
The re- quirement of this subsection shall be in addition to the information required by subsection (a) of this section.
(d) SPECIAL DISCLOSURE RULES ON PLUS LOANS, AND UNSUB- SIDIZED LOANS.—Loans made under sections 428B and 428H shall not be subject to the disclosure of projected monthly payment amounts required under subsection (b)(7) if the lender, in lieu of such disclosure, provides the borrower with sample projections of monthly repayment amounts, assuming different levels of bor- rowing and interest accruals resulting from capitalization of inter- est while the borrower, or the student on whose behalf the loan is made, is in school, in simple and understandable terms.
Such sam- ple projections shall disclose the cost to the borrower of— (1) capitalizing the interest; and (2) paying the interest as the interest accrues.
(e) REQUIRED DISCLOSURES DURING REPAYMENT.— (1) PERTINENT INFORMATION ABOUT A LOAN PROVIDED ON A PERIODIC BASIS.—Each eligible lender shall provide the bor- rower of a loan made, insured, or guaranteed under this part with a bill or statement (as applicable) that corresponds to each payment installment time period in which a payment is due and that includes, in simple and understandable terms— (A) the original principal amount of the borrower’s loan; (B) the borrower’s current balance, as of the time of the bill or statement, as applicable; (C) the interest rate on such loan; (D) the total amount the borrower has paid in interest on the loan; (E) the aggregate amount the borrower has paid for the loan, including the amount the borrower has paid in interest, the amount the borrower has paid in fees, and the amount the borrower has paid against the balance; (F) a description of each fee the borrower has been charged for the most recently preceding installment time period; (G) the date by which the borrower needs to make a payment in order to avoid additional fees and the amount of such payment and the amount of such fees; (H) the lender’s or loan servicer’s address and toll-free phone number for payment and billing error purposes; and (I) a reminder that the borrower has the option to change repayment plans, a list of the names of the repay- ment plans available to the borrower, a link to the appro- priate page of the Department’s website to obtain a more detailed description of the repayment plans, and directions for the borrower to request a change in repayment plan.
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433 (2) INFORMATION PROVIDED TO A BORROWER HAVING DIF- FICULTY MAKING PAYMENTS.—Each eligible lender shall provide to a borrower who has notified the lender that the borrower is having difficulty making payments on a loan made, insured, or guaranteed under this part with the following information in simple and understandable terms: (A) A description of the repayment plans available to the borrower, including how the borrower should request a change in repayment plan.
(B) A description of the requirements for obtaining for- bearance on a loan, including expected costs associated with forbearance.

(C) A description of the options available to the bor- rower to avoid defaulting on the loan, and any relevant fees or costs associated with such options.
(3) REQUIRED DISCLOSURES DURING DELINQUENCY.—Each eligible lender shall provide to a borrower who is 60 days delin- quent in making payments on a loan made, insured, or guaran- teed under this part with a notice, in simple and understand- able terms, of the following: (A) The date on which the loan will default if no pay- ment is made.

(B) The minimum payment the borrower must make to avoid default.
(C) A description of the options available to the bor- rower to avoid default, and any relevant fees or costs asso- ciated with such options, including a description of deferment and forbearance and the requirements to obtain each.

(D) Discharge options to which the borrower may be entitled.
(E) Additional resources, including nonprofit organiza- tions, advocates, and counselors (including the Student Loan Ombudsman of the Department), of which the lender is aware, where the borrower can receive advice and as- sistance on loan repayment.

(f) COST OF DISCLOSURE AND CONSEQUENCES OF NONDISCLO- SURE.— (1) NO COST TO BORROWERS.—The information required under this section shall be available without cost to the bor- rower.
(2) CONSEQUENCES OF NONDISCLOSURE.—The failure of an eligible lender to provide information as required by this sec- tion shall not— (A) relieve a borrower of the obligation to repay a loan in accordance with the loan’s terms; or (B) provide a basis for a claim for civil damages.

(3) RULE OF CONSTRUCTION.—Nothing in this section shall be construed as subjecting the lender to the Truth in Lending Act with regard to loans made under this part.
(4) ACTIONS BY THE SECRETARY.—The Secretary may limit, suspend, or terminate the continued participation of an eligible lender in making loans under this part for failure by that lend- er to comply with this section.

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433A HIGHER EDUCATION ACT OF 1965 400 SEC.


433A.

ø20 U.S.C.

1083a¿ CONSUMER EDUCATION INFORMATION.
(a) IN GENERAL.—Each guaranty agency participating in a pro- gram under this part, working with the institutions of higher edu- cation served by such guaranty agency, shall develop and make available high-quality educational programs and materials to pro- vide training for students and families in budgeting and financial management, including debt management and other aspects of fi- nancial literacy, such as the cost of using high interest loans to pay for postsecondary education, particularly as budgeting and finan- cial management relates to student loan programs authorized by this title.
Such programs and materials shall be in formats that are simple and understandable to students and families, and shall be provided before, during, and after the students’ enrollment in an institution of higher education.

The activities described in this sec- tion shall be considered default reduction activities for the pur- poses of section 422.
(b) RULE OF CONSTRUCTION.—Nothing in this section shall be construed to prohibit— (1) a guaranty agency from using existing activities, pro- grams, and materials in meeting the requirements of this sec- tion; (2) a guaranty agency from providing programs or mate- rials similar to the programs or materials described in sub- section (a) to an institution of higher education that provides loans exclusively through part D; or (3) a lender or loan servicer from providing outreach or fi- nancial aid literacy information in accordance with subsection (a).
SEC.

434. ø20 U.S.C.

1084¿ PARTICIPATION BY FEDERAL CREDIT UNIONS IN FEDERAL, STATE, AND PRIVATE STUDENT LOAN INSURANCE PROGRAMS.
Notwithstanding any other provision of law, Federal credit unions shall, pursuant to regulations of the National Credit Union Administration, have power to make insured loans to student mem- bers in accordance with the provisions of this part relating to feder- ally insured loans, or in accordance with the provisions of any State or nonprofit private student loan insurance program which meets the requirements of section 428(a)(1)(B).

SEC.

435. ø20 U.S.C.


1085¿ DEFINITIONS FOR STUDENT LOAN INSUR- ANCE PROGRAM.
As used in this part: (a) ELIGIBLE INSTITUTION.— (1) IN GENERAL.—Except as provided in paragraph (2), the term ‘‘eligible institution’’ means an institution of higher edu- cation, as defined in section 102, except that, for the purposes of sections 427(a)(2)(C)(i) and 428(b)(1)(M)(i), an eligible insti- tution includes any institution that is within this definition without regard to whether such institution is participating in any program under this title and includes any institution ineli- gible for participation in any program under this part pursuant to paragraph (2) of this subsection.
(2) INELIGIBILITY BASED ON HIGH DEFAULT RATES.—(A) An institution whose cohort default rate is equal to or greater than the threshold percentage specified in subparagraph (B) for each September 8, 2023 As Amended Through P.L.

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435 of the three most recent fiscal years for which data are avail- able shall not be eligible to participate in a program under this part for the fiscal year for which the determination is made and for the two succeeding fiscal years, unless, within 30 days of receiving notification from the Secretary of the loss of eligi- bility under this paragraph, the institution appeals the loss of its eligibility to the Secretary.
The Secretary shall issue a deci- sion on any such appeal within 45 days after its submission.
Such decision may permit the institution to continue to partici- pate in a program under this part if— (i) the institution demonstrates to the satisfaction of the Secretary that the Secretary’s calculation of its cohort default rate is not accurate, and that recalculation would reduce its cohort default rate for any of the three fiscal years below the threshold percentage specified in subpara- graph (B); (ii) there are exceptional mitigating circumstances within the meaning of paragraph (5); or (iii) there are, in the judgment of the Secretary, other exceptional mitigating circumstances that would make the application of this paragraph inequitable.
If an institution continues to participate in a program under this part, and the institution’s appeal of the loss of eligibility is unsuccessful, the institution shall be required to pay to the Secretary an amount equal to the amount of interest, special allowance, reinsurance, and any related payments made by the Secretary (or which the Secretary is obligated to make) with respect to loans made under this part to students attending, or planning to attend, that institution during the pendency of such appeal.
During such appeal, the Secretary may permit the institution to continue to participate in a program under this part.

(B) For purposes of determinations under subparagraph (A), the threshold percentage is— (i) 35 percent for fiscal year 1991 and 1992; (ii) 30 percent for fiscal year 1993; (iii) 32 25 percent for fiscal year 1994 through fis- cal year 2011; and (iv) 32 30 percent for fiscal year 2012 and any suc- ceeding fiscal year.
(C) Until July 1, 1999, this paragraph shall not apply to any institution that is— (i) a part B institution within the meaning of section 322(2) of this Act; (ii) a tribally controlled college or university, as de- fined in section 2(a)(4) of the Tribally Controlled Colleges and Universities Assistance Act of 1978; or (iii) a Navajo Community College under the Navajo Community College Act.

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435 HIGHER EDUCATION ACT OF 1965 402 (D) 33 Notwithstanding the first sentence of subparagraph (A), the Secretary shall restore the eligibility to participate in a pro- gram under subpart 1 of part A, part B, or part D of an institution that did not appeal its loss of eligibility within 30 days of receiving notification if the Secretary determines, on a case-by-case basis, that the institution’s failure to appeal was substantially justified under the circumstances, and that— (i) the institution made a timely request that the appro- priate guaranty agency correct errors in the draft data used to calculate the institution’s cohort default rate; (ii) the guaranty agency did not correct the erroneous data in a timely fashion; and (iii) the institution would have been eligible if the erro- neous data had been corrected by the guaranty agency.
(3) APPEALS FOR REGULATORY RELIEF.—An institution whose cohort default rate, calculated in accordance with sub- section (m), is equal to or greater than the threshold percent- age specified in paragraph (2)(B)(iv) for any two consecutive fiscal years may, not later than 30 days after the date the in- stitution receives notification from the Secretary, file an appeal demonstrating exceptional mitigating circumstances, as defined in paragraph (5).
The Secretary shall issue a decision on any such appeal not later than 45 days after the date of submission of the appeal.

If the Secretary determines that the institution demonstrates exceptional mitigating circumstances, the Sec- retary may not subject the institution to provisional certifi- cation based solely on the institution’s cohort default rate.
(4) APPEALS BASED UPON ALLEGATIONS OF IMPROPER LOAN SERVICING.—An institution that— (A) is subject to loss of eligibility for the Federal Fam- ily Education Loan Program pursuant to paragraph (2)(A) of this subsection; (B) is subject to loss of eligibility for the Federal Sup- to section for Students pursuant plemental Loans 428A(a)(2); or (C) is an institution whose cohort default rate equals or exceeds 20 percent for the most recent year for which data are available; may include in its appeal of such loss or rate a defense based on improper loan servicing (in addition to other defenses).
In any such appeal, the Secretary shall take whatever steps are necessary to ensure that such institution has access for a rea- sonable period of time, not to exceed 30 days, to a representa- tive sample (as determined by the Secretary) of the relevant loan servicing and collection records used by a guaranty agency in determining whether to pay a claim on a defaulted loan or by the Department in determining an institution’s default rate in the loan program under part D of this title.
The Secretary shall reduce the institution’s cohort default rate to reflect the percentage of defaulted loans in the representative sample that are required to be excluded pursuant to subsection (m)(1)(B).

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435 (5) DEFINITION OF MITIGATING CIRCUMSTANCES.—(A) For purposes of this subsection, an institution of higher education shall be treated as having exceptional mitigating cir- cumstances that make application of paragraph (2) inequitable, and that provide for regulatory relief under paragraph (3), if such institution, in the opinion of an independent auditor, meets the following criteria: (i) For a 12-month period that ended during the 6 months immediately preceding the fiscal year for which the cohort of borrowers used to calculate the institution’s cohort default rate is determined, at least two-thirds of the students enrolled on at least a half-time basis at the insti- tution— (I) are eligible to receive a Federal Pell Grant award that is at least equal to one-half the Federal Pell Grant amount, determined under section 401(b)(2)(A), for which a student would be eligible based on the student’s enrollment status; or (II) have an adjusted gross income that when added with the adjusted gross income of the student’s parents (unless the student is an independent stu- dent), of less than the poverty level, as determined by the Department of Health and Human Services.
(ii) In the case of an institution of higher education that offers an associate, baccalaureate, graduate or profes- sional degree, 70 percent or more of the institution’s reg- ular students who were initially enrolled on a full-time basis and were scheduled to complete their programs dur- ing the same 12-month period described in clause (i)— (I) completed the educational programs in which the students were enrolled; (II) transferred from the institution to a higher level educational program; (III) at the end of the 12-month period, remained enrolled and making satisfactory progress toward com- pletion of the student’s educational programs; or (IV) entered active duty in the Armed Forces of the United States.
(iii)(I) In the case of an institution of higher education that does not award a degree described in clause (ii), had a placement rate of 44 percent or more with respect to the institution’s former regular students who— (aa) remained in the program beyond the point the students would have received a 100 percent tuition refund from the institution; (bb) were initially enrolled on at least a half-time basis; and (cc) were originally scheduled, at the time of en- rollment, to complete their educational programs dur- ing the same 12-month period described in clause (i).
(II) The placement rate shall not include students who are still enrolled and making satisfactory progress in the educational programs in which the students were origi- nally enrolled on the date following 12 months after the September 8, 2023 As Amended Through P.L.

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435 HIGHER EDUCATION ACT OF 1965 404 date of the student’s last date of attendance at the institu- tion.
(III) The placement rate is calculated by determining the percentage of all those former regular students who— (aa) are employed, in an occupation for which the institution provided training, on the date following 12 months after the date of their last day of attendance at the institution; (bb) were employed, in an occupation for which the institution provided training, for at least 13 weeks before the date following 12 months after the date of their last day of attendance at the institution; or (cc) entered active duty in the Armed Forces of the United States.
(IV) The placement rate shall not include as place- ments a student or former student for whom the institu- tion is the employer.

(B) For purposes of determining a rate of completion and a placement rate under this paragraph, a student is originally scheduled, at the time of enrollment, to complete the edu- cational program on the date when the student will have been enrolled in the program for the amount of time normally re- quired to complete the program.
The amount of time normally required to complete the program for a student who is initially enrolled full-time is the period of time specified in the institu- tion’s enrollment contract, catalog, or other materials, for com- pletion of the program by a full-time student.

For a student who is initially enrolled less than full-time, the period is the amount of time it would take the student to complete the pro- gram if the student remained enrolled at that level of enroll- ment throughout the program.
(6) REDUCTION OF DEFAULT RATES AT CERTAIN MINORITY IN- STITUTIONS.— (A) BENEFICIARIES OF EXCEPTION REQUIRED TO ESTAB- LISH MANAGEMENT PLAN.—After July 1, 1999, any institu- tion that has a cohort default rate that equals or exceeds 25 percent for each of the three most recent fiscal years for which data are available and that relies on the exception in subparagraph (B) to continue to be an eligible institu- tion shall— (i) submit to the Secretary a default management plan which the Secretary, in the Secretary’s discretion, after consideration of the institution’s history, re- sources, dollars in default, and targets for default re- duction, determines is acceptable and provides reason- able assurance that the institution will, by July 1, 2004, have a cohort default rate that is less than 25 percent; (ii) engage an independent third party (which may be paid with funds received under section 317 or part B of title III) to provide technical assistance in imple- menting such default management plan; and (iii) provide to the Secretary, on an annual basis or at such other intervals as the Secretary may re- September 8, 2023 As Amended Through P.L.
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435 quire, evidence of cohort default rate improvement and successful implementation of such default manage- ment plan.
(B) DISCRETIONARY ELIGIBILITY CONDITIONED ON IM- PROVEMENT.—Notwithstanding the expiration of the excep- tion in paragraph (2)(C), the Secretary may, in the Sec- retary’s discretion, continue to treat an institution de- scribed in subparagraph (A) of this paragraph as an eligi- ble institution for each of the 1-year periods beginning on July 1 of 1999 through 2003, only if the institution sub- mits by the beginning of such period evidence satisfactory to the Secretary that— (i) such institution has complied and is continuing to comply with the requirements of subparagraph (A); and (ii) such institution has made substantial improve- ment, during each of the preceding 1-year periods, in the institution’s cohort default rate.
(7) DEFAULT PREVENTION AND ASSESSMENT OF ELIGIBILITY BASED ON HIGH DEFAULT RATES.— (A) FIRST YEAR.— (i) IN GENERAL.—An institution whose cohort de- fault rate is equal to or greater than the threshold percentage specified in paragraph (2)(B)(iv) in any fis- cal year shall establish a default prevention task force to prepare a plan to— (I) identify the factors causing the institu- tion’s cohort default rate to exceed such threshold; (II) establish measurable objectives and the steps to be taken to improve the institution’s co- hort default rate; and (III) specify actions that the institution can take to improve student loan repayment, including appropriate counseling regarding loan repayment options.
(ii) TECHNICAL ASSISTANCE.—Each institution sub- ject to this subparagraph shall submit the plan under clause (i) to the Secretary, who shall review the plan and offer technical assistance to the institution to pro- mote improved student loan repayment.
(B) SECOND CONSECUTIVE YEAR.— (i) IN GENERAL.—An institution whose cohort de- fault rate is equal to or greater than the threshold percentage specified in paragraph (2)(B)(iv) for two consecutive fiscal years, shall require the institution’s default prevention task force established under sub- paragraph (A) to review and revise the plan required under such subparagraph, and shall submit such re- vised plan to the Secretary.
(ii) REVIEW BY THE SECRETARY.—The Secretary shall review each revised plan submitted in accord- ance with this subparagraph, and may direct that such plan be amended to include actions, with measur- able objectives, that the Secretary determines, based September 8, 2023 As Amended Through P.L.

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435 HIGHER EDUCATION ACT OF 1965 406 on available data and analyses of student loan de- faults, will promote student loan repayment.

(8) PARTICIPATION RATE INDEX.— (A) IN GENERAL.—An institution that demonstrates to the Secretary that the institution’s participation rate index is equal to or less than 0.0375 34 for any of the 3 most re- cent fiscal years for which data is available shall not be subject to paragraph (2).
The participation rate index shall be determined by multiplying the institution’s cohort de- fault rate for loans under part B or D, or weighted average cohort default rate for loans under parts B and D, by the percentage of the institution’s regular students, enrolled on at least a half-time basis, who received a loan made under part B or D for a 12-month period ending during the 6 months immediately preceding the fiscal year for which the cohort of borrowers used to calculate the institution’s cohort default rate is determined.
(B) DATA.—An institution shall provide the Secretary with sufficient data to determine the institution’s partici- pation rate index within 30 days after receiving an initial notification of the institution’s draft cohort default rate.

(C) NOTIFICATION.—Prior to publication of a final co- hort default rate for an institution that provides the data described in subparagraph (B), the Secretary shall notify the institution of the institution’s compliance or non- compliance with subparagraph (A).
(d) 35 ELIGIBLE LENDER.— (1) IN GENERAL.—Except as provided in paragraphs (2) through (6), the term ‘‘eligible lender’’ means— (A) a National or State chartered bank, a mutual sav- ings bank, a savings and loan association, a stock savings bank, or a credit union which— (i) is subject to examination and supervision by an agency of the United States or of the State in which its principal place of operation is established, and (ii) does not have as its primary consumer credit function the making or holding of loans made to stu- dents under this part unless (I) it is a bank which is wholly owned by a State, or a bank which is subject to examination and supervision by an agency of the United States, makes student loans as a trustee pur- suant to an express trust, operated as a lender under this part prior to January 1, 1975, and which meets the requirements of this provision prior to the enact- ment of the Higher Education Amendments of 1992, (II) it is a single wholly owned subsidiary of a bank holding company which does not have as its primary consumer credit function the making or holding of loans made to students under this part, (III) it is a bank (as defined in section 3(a)(1) of the Federal De- posit Insurance Act (12 U.S.C.
1813(a)(1)) that is a 34 Effective October 1, 2011, subparagraph (F) of section 436(a)(1) of Public Law 110–315 amends paragraph (8)(A) by striking ‘‘0.0375’’ and inserting ‘‘0.0625’’.

35 Subsections (b) and (c) were repealed by P.L.

102–325, sec.

427(b)(1) and (2), 106 Stat.

549.

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435 wholly owned subsidiary of a nonprofit foundation, the foundation is described in section 501(c)(3) of the In- ternal Revenue Code of 1986 and exempt from tax- ation under section 501(a) of such Code, and the bank makes loans under this part only to undergraduate students who are age 22 or younger and has a port- folio of such loans that is not more than $5,000,000, or (IV) it is a National or State chartered bank, or a credit union, with assets of less than $1,000,000,000; (B) a pension fund as defined in the Employee Retire- ment Income Security Act; (C) an insurance company which is subject to exam- ination and supervision by an agency of the United States or a State; (D) in any State, a single agency of the State or a sin- gle nonprofit private agency designated by the State; (E) an eligible institution which meets the require- ments of paragraphs (2) through (5) of this subsection; (F) for purposes only of purchasing and holding loans made by other lenders under this part, the Student Loan Marketing Association or the Holding Company of the Stu- dent Loan Marketing Association, including any subsidiary of the Holding Company, created pursuant to section 440, or an agency of any State functioning as a secondary mar- ket; (G) for purposes of making loans under sections 428B(d) and 428C, the Student Loan Marketing Associa- tion or the Holding Company of the Student Loan Mar- keting Association, including any subsidiary of the Holding Company, created pursuant to section 440; (H) for purposes of making loans under sections 428(h) and 428(j), a guaranty agency; (I) a Rural Rehabilitation Corporation, or its successor agency, which has received Federal funds under Public Law 499, Eighty-first Congress (64 Stat.
98 (1950)); (J) for purpose of making loans under section 428C, any nonprofit private agency functioning in any State as a secondary market; and (K) a consumer finance company subsidiary of a na- tional bank which, as of the date of enactment of this sub- paragraph, through one or more subsidiaries: (i) acts as a small business lending company, as determined under reg- ulations of the Small Business Administration under sec- tion 120.470 of title 13, Code of Federal Regulations (as such section is in effect on the date of enactment of this subparagraph); and (ii) participates in the program author- ized by this part pursuant to subparagraph (C), provided the national bank and all of the bank’s direct and indirect subsidiaries taken together as a whole, do not have, as their primary consumer credit function, the making or holding of loans made to students under this part.
(2) REQUIREMENTS FOR ELIGIBLE INSTITUTIONS.— (A) IN GENERAL.—To be an eligible lender under this part, an eligible institution— September 8, 2023 As Amended Through P.L.

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435 HIGHER EDUCATION ACT OF 1965 408 (i) shall employ at least one person whose full- time responsibilities are limited to the administration of programs of financial aid for students attending such institution; (ii) shall not be a home study school; (iii) shall not— (I) make a loan to any undergraduate student; (II) make a loan other than a loan under sec- tion 428 or 428H to a graduate or professional student; or (III) make a loan to a borrower who is not en- rolled at that institution; (iv) shall award any contract for financing, serv- icing, or administration of loans under this title on a competitive basis; (v) shall offer loans that carry an origination fee or an interest rate, or both, that are less than such fee or rate authorized under the provisions of this title; (vi) shall not have a cohort default rate (as de- fined in subsection (m)) greater than 10 percent; (vii) shall, for any year for which the institution engages in activities as an eligible lender, provide for a compliance audit conducted in accordance with sec- tion 428(b)(1)(U)(iii)(I), and the regulations there- under, and submit the results of such audit to the Sec- retary; (viii) shall use any proceeds from special allow- ance payments and interest payments from borrowers, interest subsidies received from the Department of Education, and any proceeds from the sale or other disposition of loans, for need-based grant programs; and (ix) shall have met the requirements of subpara- graphs (A) through (F) of this paragraph as in effect on the day before the date of enactment of the Higher Education Reconciliation Act of 2005, and made loans under this part, on or before April 1, 2006.
(B) ADMINISTRATIVE EXPENSES.—An eligible lender under subparagraph (A) shall be permitted to use a por- tion of the proceeds described in subparagraph (A)(viii) for reasonable and direct administrative expenses.

(C) SUPPLEMENT, NOT SUPPLANT.—An eligible lender under subparagraph (A) shall ensure that the proceeds de- scribed in subparagraph (A)(viii) are used to supplement, and not to supplant, non-Federal funds that would other- wise be used for need-based grant programs.
(3) DISQUALIFICATION FOR HIGH DEFAULT RATES.—The term ‘‘eligible lender’’ does not include any eligible institution in any fiscal year immediately after the fiscal year in which the Sec- retary determines, after notice and opportunity for a hearing, that for each of 2 consecutive years, 15 percent or more of the total amount of such loans as are described in section 428(a)(1) made by the institution with respect to students at that insti- September 8, 2023 As Amended Through P.L.
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435 tution and repayable in each such year, are in default, as de- fined in subsection (m).
(4) WAIVER OF DISQUALIFICATION.—Whenever the Sec- retary determines that— (A) there is reasonable possibility that an eligible in- stitution may, within 1 year after a determination is made under paragraph (3), improve the collection of loans de- scribed in section 428(a)(1), so that the application of para- graph (3) would be a hardship to that institution, or (B) the termination of the lender’s status under para- graph (3) would be a hardship to the present or for pro- spective students of the eligible institution, after consid- ering the management of that institution, the ability of that institution to improve the collection of loans, the op- portunities that institution offers to economically dis- advantaged students, and other related factors, the Secretary shall waive the provisions of paragraph (3) with respect to that institution.
Any determination required under this paragraph shall be made by the Secretary prior to the ter- mination of an eligible institution as a lender under the excep- tion of paragraph (3).

Whenever the Secretary grants a waiver pursuant to this paragraph, the Secretary shall provide tech- nical assistance to the institution concerned in order to im- prove the collection rate of such loans.
(5) DISQUALIFICATION FOR USE OF CERTAIN INCENTIVES.— The term ‘‘eligible lender’’ does not include any lender that the Secretary determines, after notice and opportunity for a hear- ing, has— (A) offered, directly or indirectly, points, premiums, payments (including payments for referrals and for proc- essing or finder fees), prizes, stock or other securities, trav- el, entertainment expenses, tuition payment or reimburse- ment, the provision of information technology equipment at below-market value, additional financial aid funds, or other inducements, to any institution of higher education, any employee of an institution of higher education, or any individual or entity in order to secure applicants for loans under this part; (B) conducted unsolicited mailings, by postal or elec- tronic means, of student loan application forms to students enrolled in secondary schools or postsecondary institutions, or to family members of such students, except that applica- tions may be mailed, by postal or electronic means, to stu- dents or borrowers who have previously received loans under this part from such lender; (C) entered into any type of consulting arrangement, or other contract to provide services to a lender, with an employee who is employed in the financial aid office of an institution of higher education, or who otherwise has re- sponsibilities with respect to student loans or other finan- cial aid of the institution; (D) compensated an employee who is employed in the financial aid office of an institution of higher education, or who otherwise has responsibilities with respect to student September 8, 2023 As Amended Through P.L.
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435 HIGHER EDUCATION ACT OF 1965 410 loans or other financial aid of the institution, and who is serving on an advisory board, commission, or group estab- lished by a lender or group of lenders for providing such service, except that the eligible lender may reimburse such employee for reasonable expenses incurred in providing such service; (E) performed for an institution of higher education any function that such institution of higher education is required to perform under this title, except that a lender shall be permitted to perform functions on behalf of such institution in accordance with section 485(b) or 485(l); (F) paid, on behalf of an institution of higher edu- cation, another person to perform any function that such institution of higher education is required to perform under this title, except that a lender shall be permitted to perform functions on behalf of such institution in accord- ance with section 485(b) or 485(l); (G) provided payments or other benefits to a student at an institution of higher education to act as the lender’s representative to secure applications under this title from individual prospective borrowers, unless such student— (i) is also employed by the lender for other pur- poses; and (ii) made all appropriate disclosures regarding such employment; (H) offered, directly or indirectly, loans under this part as an inducement to a prospective borrower to purchase a policy of insurance or other product; or (I) engaged in fraudulent or misleading advertising.
It shall not be a violation of this paragraph for a lender to pro- vide technical assistance to institutions of higher education comparable to the kinds of technical assistance provided to in- stitutions of higher education by the Department.

(6) REBATE FEE REQUIREMENT.—To be an eligible lender under this part, an eligible lender shall pay rebate fees in ac- cordance with section 428C(f).
(7) 36 ELIGIBLE LENDER TRUSTEES.—Notwithstanding any other provision of this subsection, an eligible lender may not make or hold a loan under this part as trustee for an institu- tion of higher education, or for an organization affiliated with an institution of higher education, unless— (A) the eligible lender is serving as trustee for that in- stitution or organization as of the date of enactment of the Third Higher Education Extension Act of 2006 under a contract that was originally entered into before the date of enactment of such Act and that continues in effect or is re- newed after such date; and (B) the institution or organization, and the eligible lender, with respect to its duties as trustee, each comply 36 Effective Date: Section 3(b) of Public Law 109–292 (120 Stat.
1345), states that the amend- ment made by subsection (a) of such section (which adds paragraph (7)) ‘‘shall not apply with respect to any loan under part B of title IV of the Higher Education Act of 1965 (20 U.S.C.

1071 et seq.)

disbursed before January 1, 2007.’’.

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435 on and after January 1, 2007, with the requirements of paragraph (2), except that— (i) the requirements of clauses (i), (ii), (vi), and (viii) of paragraph (2)(A) shall, subject to clause (ii) of this subparagraph, only apply to the institution (in- cluding both an institution for which the lender serves as trustee and an institution affiliated with an organi- zation for which the lender serves as trustee); (ii) in the case of an organization affiliated with an institution— (I) the requirements of clauses (iii) and (v) of paragraph (2)(A) shall apply to the organization; and (II) the requirements of clause (viii) of para- graph (2)(A) shall apply to the institution or the organization (or both), if the institution or organi- zation receives (directly or indirectly) the proceeds described in such clause; (iii) the requirements of clauses (iv) and (ix) of paragraph (2)(A) shall not apply to the eligible lender, institution, or organization; and (iv) the eligible lender, institution, and organiza- tion shall ensure that the loans made or held by the eligible lender as trustee for the institution or organi- zation, as the case may be, are included in a compli- ance audit in accordance with clause (vii) of paragraph (2)(A).
(8) SCHOOL AS LENDER PROGRAM AUDIT.—Each institution serving as an eligible lender under paragraph (1)(E), and each eligible lender serving as a trustee for an institution of higher education or an organization affiliated with an institution of higher education, shall annually complete and submit to the Secretary a compliance audit to determine whether— (A) the institution or lender is using all proceeds from special allowance payments and interest payments from borrowers, interest subsidies received from the Depart- ment, and any proceeds from the sale or other disposition of loans, for need-based grant programs, in accordance with paragraph (2)(A)(viii); (B) the institution or lender is using not more than a reasonable portion of the proceeds described in paragraph (2)(A)(viii) for direct administrative expenses; and (C) the institution or lender is ensuring that the pro- ceeds described in paragraph (2)(A)(viii) are being used to supplement, and not to supplant, Federal and non-Federal funds that would otherwise be used for need-based grant programs.
(e) LINE OF CREDIT.—The term ‘‘line of credit’’ means an ar- rangement or agreement between the lender and the borrower whereby a loan is paid out by the lender to the borrower in annual installments, or whereby the lender agrees to make, in addition to the initial loan, additional loans in subsequent years.

(f) DUE DILIGENCE.—The term ‘‘due diligence’’ requires the uti- lization by a lender, in the servicing and collection of loans insured September 8, 2023 As Amended Through P.L.
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435 HIGHER EDUCATION ACT OF 1965 412 under this part, of servicing and collection practices at least as ex- tensive and forceful as those generally practiced by financial insti- tutions for the collection of consumer loans.

(i) 37 HOLDER.—The term ‘‘holder’’ means an eligible lender who owns a loan.
(j) GUARANTY AGENCY.—The term ‘‘guaranty agency’’ means any State or nonprofit private institution or organization with which the Secretary has an agreement under section 428(b).

(k) INSURANCE BENEFICIARY.—The term ‘‘insurance bene- ficiary’’ means the insured or its authorized representative as- signed in accordance with section 429(d).
(l) DEFAULT.—Except as provided in subsection (m), the term ‘‘default’’ includes only such defaults as have existed for (1) 270 days in the case of a loan which is repayable in monthly install- ments, or (2) 330 days in the case of a loan which is repayable in less frequent installments.
38 (m) COHORT DEFAULT RATE.— (1) IN GENERAL.—(A) Except as provided in paragraph (2), the term ‘‘cohort default rate’’ means, for any fiscal year in which 30 or more current and former students at the institu- tion enter repayment on loans under section 428, 428A, or 428H, received for attendance at the institution, the percent- age of those current and former students who enter repayment on such loans (or on the portion of a loan made under section 428C that is used to repay any such loans) received for attend- ance at that institution in that fiscal year who default before the end of the second fiscal year following the fiscal year in which the students entered repayment.
The Secretary shall re- quire that each guaranty agency that has insured loans for current or former students of the institution afford such insti- tution a reasonable opportunity (as specified by the Secretary) to review and correct errors in the information required to be provided to the Secretary by the guaranty agency for the pur- poses of calculating a cohort default rate for such institution, prior to the calculation of such rate.
(B) In determining the number of students who default be- fore the end of such second fiscal year, the Secretary shall in- clude only loans for which the Secretary or a guaranty agency has paid claims for insurance.
In considering appeals with re- spect to cohort default rates pursuant to subsection (a)(3), the Secretary shall exclude, from the calculation of the number of students who entered repayment and from the calculation of the number of students who default, any loans which, due to improper servicing or collection, would, as demonstrated by the evidence submitted in support of the institution’s timely appeal 37 Section 427(f) of the Higher Education Amendments of 1992 (P.L.

102–325; 106 Stat.
102–325; 106 Stat.

550) amended section 435 of the Higher Education Act of 1965 by striking subsections (g), (h), and (n), but did not to redesignate remaining subsections.

38 Section 429(c)(2) of the Higher Education Amendments of 1998 (P.L.

105–244; 112 Stat.
105–244; 112 Stat.

1708) amended subsection (l) of the Higher Education Act of 1965 by striking ‘‘180 days’’ and ‘‘240 days’’ and inserting ‘‘270 days’’ and ‘‘330 days’’, respectively, with respect to loans for which the first day of delinquency occurred on or after the date of enactment of that Act.

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435 to the Secretary, result in an inaccurate or incomplete calcula- tion of such cohort default rate.
(C) For any fiscal year in which fewer than 30 of the insti- tution’s current and former students enter repayment, the term ‘‘cohort default rate’’ means the percentage of such cur- rent and former students who entered repayment on such loans (or on the portion of a loan made under section 428C that is used to repay any such loans) in any of the three most recent fiscal years, who default before the end of the second fis- cal year following the year in which they entered repayment.
(2) SPECIAL RULES.—(A) In the case of a student who has attended and borrowed at more than one school, the student (and such student’s subsequent repayment or default) is attrib- uted to each school for attendance at which the student re- ceived a loan that entered repayment in the fiscal year.
(B) A loan on which a payment is made by the school, such school’s owner, agent, contractor, employee, or any other entity or individual affiliated with such school, in order to avoid de- fault by the borrower, is considered as in default for purposes of this subsection.

(C) Any loan which has been rehabilitated before the end of the second fiscal year following the year in which the loan entered repayment is not considered as in default for purposes of this subsection.
The Secretary may require guaranty agen- cies to collect data with respect to defaulted loans in a manner that will permit the identification of any defaulted loan for which (i) the borrower is currently making payments and has made not less than 6 consecutive on-time payments by the end of such second fiscal year, and (ii) a guaranty agency has re- newed the borrower’s title IV eligibility as provided in section 428F(b).
(D) For the purposes of this subsection, a loan made in ac- cordance with section 428A (or the portion of a loan made under section 428C that is used to repay a loan made under section 428A) shall not be considered to enter repayment until after the borrower has ceased to be enrolled in a course of study leading to a degree or certificate at an eligible institution on at least a half-time basis (as determined by the institution) and ceased to be in a period of forbearance based on such en- rollment.
Each eligible lender of a loan made under section 428A (or a loan made under section 428C a portion of which is used to repay a loan made under section 428A) shall provide the guaranty agency with the information necessary to deter- mine when the loan entered repayment for purposes of this subsection, and the guaranty agency shall provide such infor- mation to the Secretary.
(3) REGULATIONS TO PREVENT EVASIONS.—The Secretary shall prescribe regulations designed to prevent an institution from evading the application to that institution of a default rate determination under this subsection through the use of such measures as branching, consolidation, change of owner- ship or control, or any similar device.

(4) COLLECTION AND REPORTING OF COHORT DEFAULT RATES AND LIFE OF COHORT DEFAULT RATES.—(A) The Secretary shall September 8, 2023 As Amended Through P.L.
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435 HIGHER EDUCATION ACT OF 1965 414 publish not less often than once every fiscal year a report showing cohort default data and life of cohort default rates for each category of institution, including: (i) four-year public insti- tutions; (ii) four-year private nonprofit institutions; (iii) two- year public institutions; (iv) two-year private nonprofit institu- tions; (v) four-year proprietary institutions; (vi) two-year pro- prietary institutions; and (vii) less than two-year proprietary institutions.
For purposes of this subparagraph, for any fiscal year in which one or more current and former students at an institution enter repayment on loans under section 428, 428B, or 428H, received for attendance at the institution, the Sec- retary shall publish the percentage of those current and former students who enter repayment on such loans (or on the portion of a loan made under section 428C that is used to repay any such loans) received for attendance at the institution in that fiscal year who default before the end of each succeeding fiscal year.
(B) The Secretary may designate such additional subcat- egories within the categories specified in subparagraph (A) as the Secretary deems appropriate.

(C) The Secretary shall publish not less often than once every fiscal year a report showing default data for each institu- tion for which a cohort default rate is calculated under this subsection.

(D) The Secretary shall publish the report described in subparagraph (C) by September 30 of each year.
(o) 39 ECONOMIC HARDSHIP.— (1) IN GENERAL.—For purposes of this part and part E, a borrower shall be considered to have an economic hardship if— (A) such borrower is working full-time and is earning an amount which does not exceed the greater of— (i) the minimum wage rate described in section 6 of the Fair Labor Standards Act of 1938; or (ii) an amount equal to 150 percent of the poverty line applicable to the borrower’s family size as deter- mined in accordance with section 673(2) of the Com- munity Services Block Grant Act; or (B) such borrower meets such other criteria as are es- tablished by the Secretary by regulation in accordance with paragraph (2).
(2) CONSIDERATIONS.—In establishing criteria for purposes of paragraph (1)(B), the Secretary shall consider the borrower’s income and debt-to-income ratio as primary factors.
(p) ELIGIBLE NOT-FOR-PROFIT HOLDER.— (1) DEFINITION.—Subject to the limitations in paragraph (2) and the prohibition in paragraph (3), the term ‘‘eligible not- for-profit holder’’ means an eligible lender under subsection (d) (except for an eligible lender described in subsection (d)(1)(E)) that requests a special allowance payment under section 438(b)(2)(I)(vi)(II) or a payment under section 781 and that is— (A) a State, or a political subdivision, authority, agen- cy, or other instrumentality thereof, including such entities September 8, 2023 As Amended Through P.L.
117-286, Enacted December 27, 2022 39 Subsection (n) repealed by sec.

427(f) of P.L.

102–325.

See footnote to subsection (i).

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435 that are eligible to issue bonds described in section 1.103– 1 of title 26, Code of Federal Regulations, or section 144(b) of the Internal Revenue Code of 1986; (B) an entity described in section 150(d)(2) of such Code that has not made the election described in section 150(d)(3) of such Code; (C) an entity described in section 501(c)(3) of such Code; or (D) acting as a trustee on behalf of a State, political subdivision, authority, agency, instrumentality, or other entity described in subparagraph (A), (B), or (C), regard- less of whether such State, political subdivision, authority, agency, instrumentality, or other entity is an eligible lend- er under subsection (d).
(2) LIMITATIONS.— (A) EXISTING ON DATE OF ENACTMENT.— (i) IN GENERAL.—An eligible lender shall not be an eligible not-for-profit holder under this Act unless such lender— (I) was a State, political subdivision, author- ity, agency, instrumentality, or other entity de- scribed in paragraph (1)(A), (B), or (C) that was, on the date of the enactment of the College Cost Reduction and Access Act, acting as an eligible lender under subsection (d) (other than an eligible lender described in subsection (d)(1)(E)); or (II) is acting as a trustee on behalf of a State, political subdivision, authority, agency, instru- mentality, or other entity described in subpara- graph (A), (B), or (C) of paragraph (1), regardless of whether such State, political subdivision, au- thority, agency, instrumentality, or other entity is an eligible lender under subsection (d), and such State, political subdivision, authority, agency, in- strumentality, or other entity, on the date of en- actment of the College Cost Reduction and Access Act, was the sole beneficial owner of a loan eligi- ble for any special allowance payment under sec- tion 438.
(ii) EXCEPTION.—Notwithstanding clause (i), a State may elect, in accordance with regulations of the Secretary, to waive the requirements of this subpara- graph for a new not-for-profit holder determined by the State to be necessary to carry out a public purpose of such State, except that a State may not make such election with respect the requirements of clause (i)(II).
(B) NO FOR-PROFIT OWNERSHIP OR CONTROL.— (i) IN GENERAL.—No State, political subdivision, authority, agency, instrumentality, or other entity de- scribed in paragraph (1)(A), (B), or (C) shall be an eli- gible not-for-profit holder under this Act if such State, political subdivision, authority, agency, instrumen- tality, or other entity is owned or controlled, in whole or in part, by a for-profit entity.

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435 HIGHER EDUCATION ACT OF 1965 416 (ii) TRUSTEES.—A trustee described in paragraph (1)(D) shall not be an eligible not-for-profit holder under this Act with respect to a State, political sub- division, authority, agency, instrumentality, or other entity described in subparagraph (A), (B), or (C) of paragraph (1), regardless of whether such State, polit- ical subdivision, authority, agency, instrumentality, or other entity is an eligible lender under subsection (d), if such State, political subdivision, authority, agency, instrumentality, or other entity is owned or controlled, in whole or in part, by a for-profit entity.
(C) SOLE OWNERSHIP OF LOANS AND INCOME.—No State, political subdivision, authority, agency, instrumen- tality, trustee, or other entity described in paragraph (1)(A), (B), (C), or (D) shall be an eligible not-for-profit holder under this Act with respect to any loan, or income from any loan, unless— (i) such State, political subdivision, authority, agency, instrumentality, or other entity is the sole beneficial owner of such loan and the income from such loan; or (ii) such trustee holds the loan on behalf of a State, political subdivision, authority, agency, instru- mentality, or other entity described in subparagraph (A), (B), or (C) of paragraph (1), regardless of whether such State, political subdivision, authority, agency, in- strumentality, or other entity is an eligible lender under subsection (d), and such State, political subdivi- sion, authority, agency, instrumentality, or other enti- ty is the sole beneficial owner of such loan and the in- come from such loan.
(D) TRUSTEE COMPENSATION LIMITATIONS.—A trustee described in paragraph (1)(D) shall not receive compensa- tion as consideration for acting as an eligible lender on be- half of a State, political subdivision, authority, agency, in- strumentality, or other entity described in subparagraph (A), (B), or (C) of paragraph (1), regardless of whether such State, political subdivision, authority, agency, instrumen- tality, or other entity is an eligible lender under subsection (d), in excess of reasonable and customary fees.
(E) RULE OF CONSTRUCTION.—For purposes of subpara- graphs (A), (B), (C), and (D) of this paragraph, a State, po- litical subdivision, authority, agency, instrumentality, or other entity described in subparagraph (A), (B), or (C) of paragraph (1), regardless of whether such State, political subdivision, authority, agency, instrumentality, or other entity is an eligible lender under subsection (d), shall not— (i) be deemed to be owned or controlled, in whole or in part, by a for-profit entity; or (ii) lose its status as the sole owner of a beneficial interest in a loan and the income from a loan, by such State, political subdivision, authority, agency, in- strumentality, or other entity, or by the trustee described September 8, 2023 As Amended Through P.L.
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437 in paragraph (1)(D), granting a security interest in, or oth- erwise pledging as collateral, such loan, or the income from such loan, to secure a debt obligation for which such State, political subdivision, authority, agency, instrumen- tality, or other entity is the issuer of the debt obligation.
(3) PROHIBITION.—In the case of a loan for which the spe- cial allowance payment section is 438(b)(2)(I)(vi)(II) and that is sold by the eligible not-for-profit holder holding the loan to an entity that is not an eligible not- for-profit holder under this Act, the special allowance payment for such loan shall, beginning on the date of the sale, no longer be calculated under section 438(b)(2)(I)(vi)(II) and shall be cal- culated under section 438(b)(2)(I)(vi)(I) instead.
calculated under (4) REGULATIONS.—Not later than 1 year after the date of enactment of the College Cost Reduction and Access Act, the Secretary shall promulgate regulations in accordance with the provisions of this subsection.

SEC.

436. ø20 U.S.C.

1086¿ DELEGATION OF FUNCTIONS.


(a) IN GENERAL.—An eligible lender or guaranty agency that contracts with another entity to perform any of the lender’s or agency’s functions under this title, or otherwise delegates the per- formance of such functions to such other entity— (1) shall not be relieved of the lender’s or agency’s duty to comply with the requirements of this title; and (2) shall monitor the activities of such other entity for com- pliance with such requirements.
(b) SPECIAL RULE.—A lender that holds a loan made under part B in the lender’s capacity as a trustee is responsible for com- plying with all statutory and regulatory requirements imposed on any other holder of a loan made under this part.

SEC.

437. ø20 U.S.C.

1087¿ REPAYMENT BY THE SECRETARY OF LOANS OF BANKRUPT, DECEASED, OR DISABLED BORROWERS; TREATMENT OF BORROWERS ATTENDING SCHOOLS THAT FAIL TO PROVIDE A REFUND, ATTENDING CLOSED SCHOOLS, OR FALSELY CERTIFIED AS ELIGIBLE TO BOR- ROW.
(a) REPAYMENT IN FULL FOR DEATH AND DISABILITY.— (1) IN GENERAL.—If a student borrower who has received a loan described in subparagraph (A) or (B) of section 428(a)(1) dies or becomes permanently and totally disabled (as deter- mined in accordance with regulations of the Secretary), or if a student borrower who has received such a loan is unable to en- gage in any substantial gainful activity by reason of any medi- cally determinable physical or mental impairment that can be expected to result in death, has lasted for a continuous period of not less than 60 months, or can be expected to last for a con- tinuous period of not less than 60 months then the Secretary shall discharge the borrower’s liability on the loan by repaying the amount owed on the loan.
The Secretary may develop such safeguards as the Secretary determines necessary to prevent fraud and abuse in the discharge of liability under this sub- section.

Notwithstanding any other provision of this sub- section, the Secretary may promulgate regulations to reinstate September 8, 2023 As Amended Through P.L.
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437 HIGHER EDUCATION ACT OF 1965 418 the obligation of, and resume collection on, loans discharged under this subsection in any case in which— (A) a borrower received a discharge of liability under this subsection and after the discharge the borrower— (i) receives a loan made, insured, or guaranteed under this title; or (ii) has earned income in excess of the poverty line; or (B) the Secretary determines the reinstatement and resumption to be necessary.
(2) DISABILITY DETERMINATIONS.—A borrower who has been determined by the Secretary of Veterans Affairs to be un- employable due to a service-connected condition and who pro- vides documentation of such determination to the Secretary of Education, shall be considered permanently and totally dis- abled for the purpose of discharging such borrower’s loans under this subsection, and such borrower shall not be required to present additional documentation for purposes of this sub- section.
(3) AUTOMATIC INCOME MONITORING.— (A) IN GENERAL.—The Secretary shall establish and implement, with respect to any borrower described in sub- paragraph (B), procedures to— (i) use return information disclosed under section 6103(l)(13) of the Internal Revenue Code of 1986, pur- suant to approval provided under section 494, to deter- mine the borrower’s continued eligibility for the loan discharge described in subparagraph (B); (ii) allow the borrower, at any time, to opt out of disclosure under such section 6103(l)(13) and instead provide such information as the Secretary may require to determine the borrower’s continued eligibility for such loan discharge; and (iii) provide the borrower with an opportunity to update the return information so disclosed before de- termination of such borrower’s continued eligibility for such loan discharge.
(B) APPLICABILITY.—Subparagraph (A) shall apply— (i) to each borrower of a loan that is discharged due to the total and permanent disability (within the meaning of this subsection) of the borrower; and (ii) during the period beginning on the date on which such loan is so discharged and ending on the first day on which such loan may no longer be rein- stated.
(b) PAYMENT OF CLAIMS ON LOANS IN BANKRUPTCY.—The Sec- retary shall pay to the holder of a loan described in section 428(a)(1) (A) or (B), 428A, 428B, 428C, or 428H, the amount of the unpaid balance of principal and interest owed on such loan— (1) when the borrower files for relief under chapter 12 or 13 of title 11, United States Code; (2) when the borrower who has filed for relief under chap- ter 7 or 11 of such title commences an action for a determina- September 8, 2023 As Amended Through P.L.
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437 tion of dischargeability under section 523(a)(8)(B) of such title; or (3) for loans described in section 523(a)(8)(A) of such title, when the borrower files for relief under chapter 7 or 11 of such title.
(c) DISCHARGE.— (1) IN GENERAL.—If a borrower who received, on or after January 1, 1986, a loan made, insured, or guaranteed under this part and the student borrower, or the student on whose behalf a parent borrowed, is unable to complete the program in which such student is enrolled due to the closure of the in- stitution or if such student’s eligibility to borrow under this part was falsely certified by the eligible institution or was falsely certified as a result of a crime of identity theft, or if the institution failed to make a refund of loan proceeds which the institution owed to such student’s lender, then the Secretary shall discharge the borrower’s liability on the loan (including interest and collection fees) by repaying the amount owed on the loan and shall subsequently pursue any claim available to such borrower against the institution and its affiliates and principals or settle the loan obligation pursuant to the finan- cial responsibility authority under subpart 3 of part H. In the case of a discharge based upon a failure to refund, the amount of the discharge shall not exceed that portion of the loan which should have been refunded.
The Secretary shall report to the authorizing committees annually as to the dollar amount of loan discharges attributable to failures to make refunds.

(2) ASSIGNMENT.—A borrower whose loan has been dis- charged pursuant to this subsection shall be deemed to have assigned to the United States the right to a loan refund up to the amount discharged against the institution and its affiliates and principals.
(3) ELIGIBILITY FOR ADDITIONAL ASSISTANCE.—The period of a student’s attendance at an institution at which the student was unable to complete a course of study due to the closing of the institution shall not be considered for purposes of calcu- lating the student’s period of eligibility for additional assist- ance under this title.
(4) SPECIAL RULE.—A borrower whose loan has been dis- charged pursuant to this subsection shall not be precluded from receiving additional grants, loans, or work assistance under this title for which the borrower would be otherwise eli- gible (but for the default on such discharged loan).

The amount discharged under this subsection shall be treated the same as loans under section 465(a)(5) of this title.
(5) REPORTING.—The Secretary shall report to consumer reporting agencies with respect to loans which have been dis- charged pursuant to this subsection.

(d) REPAYMENT OF LOANS TO PARENTS.—If a student on whose behalf a parent has received a loan described in section 428B dies, then the Secretary shall discharge the borrower’s liability on the loan by repaying the amount owed on the loan.

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438 HIGHER EDUCATION ACT OF 1965 420 øSection 437A repealed by P.L.

105–244, sec.

432, 112 Stat.

1710.¿ SEC.

438. ø20 U.S.C.

1087–1¿ SPECIAL ALLOWANCES.
(a) FINDINGS.—In order to assure (1) that the limitation on in- terest payments or other conditions (or both) on loans made or in- sured under this part, do not impede or threaten to impede the car- rying out of the purposes of this part or do not cause the return to holders of loans to be less than equitable, (2) that incentive pay- ments on such loans are paid promptly to eligible lenders, and (3) that appropriate consideration of relative administrative costs and money market conditions is made in setting the quarterly rate of such payments, the Congress finds it necessary to establish an im- proved method for the determination of the quarterly rate of the special allowances on such loans, and to provide for a thorough, ex- peditious, and objective examination of alternative methods for the determination of the quarterly rate of such allowances.
(b) COMPUTATION AND PAYMENT.— (1) QUARTERLY PAYMENT BASED ON UNPAID BALANCE.—A special allowance shall be paid for each of the 3-month periods ending March 31, June 30, September 30, and December 31 of every year and the amount of such allowance paid to any hold- er with respect to any 3-month period shall be a percentage of the average unpaid balance of principal (not including un- earned interest added to principal) of all eligible loans held by such holder during such period.
(2) RATE OF SPECIAL ALLOWANCE.—(A) Subject to subpara- graphs (B), (C), (D), (E), (F), (G), (H), and (I) and paragraph (4), the special allowance paid pursuant to this subsection on loans shall be computed (i) by determining the average of the bond equivalent rates of 91-day Treasury bills auctioned for such 3-month period, (ii) by subtracting the applicable interest rate on such loans from such average, (iii) by adding 3.10 per- cent to the resultant percent, and (iv) by dividing the resultant percent by 4.
If such computation produces a number less than zero, such loans shall be subject to section 427A(i).
(B)(i) The quarterly rate of the special allowance for hold- ers of loans which were made or purchased with funds ob- tained by the holder from the issuance of obligations, the in- come from which is exempt from taxation under the Internal Revenue Code of 1986 shall be one-half the quarterly rate of the special allowance established under subparagraph (A), ex- cept that, in determining the rate for the purpose of this clause, subparagraph (A)(iii) shall be applied by substituting ‘‘3.5 percent’’ for ‘‘3.10 percent’’.
Such rate shall also apply to holders of loans which were made or purchased with funds ob- tained by the holder from collections or default reimburse- ments on, or interests or other income pertaining to, eligible loans made or purchased with funds described in the preceding sentence of this subparagraph or from income on the invest- ment of such funds.

This subparagraph shall not apply to loans which were made or insured prior to October 1, 1980.
(ii) The quarterly rate of the special allowance set under clause (i) of this subparagraph shall not be less than 9.5 per- September 8, 2023 As Amended Through P.L.

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438 cent minus the applicable interest rate on such loans, divided by 4.
(iii) No special allowance may be paid under this subpara- graph unless the issuer of such obligations complies with sub- section (d) of this section.
(iv) Notwithstanding clauses (i) and (ii), the quarterly rate of the special allowance for holders of loans which are financed with funds obtained by the holder from the issuance of obliga- tions originally issued on or after October 1, 1993, or refunded after September 30, 2004, the income from which is excluded from gross income under the Internal Revenue Code of 1986, shall be the quarterly rate of the special allowance established under subparagraph (A), (E), (F), (G), (H), or (I) as the case may be.
Such rate shall also apply to holders of loans which were made or purchased with funds obtained by the holder from collections or default reimbursements on, or interest or other income pertaining to, eligible loans made or purchased with funds described in the preceding sentence of this subpara- graph or from income on the investment of such funds.
(v) Notwithstanding clauses (i) and (ii), the quarterly rate of the special allowance shall be the rate determined under subparagraph (A), (E), (F), (G), (H), or (I) of this paragraph, or paragraph (4), as the case may be, for a holder of loans that— (I) were made or purchased with funds— (aa) obtained from the issuance of obligations the income from which is excluded from gross income under the Internal Revenue Code of 1986 and which obligations were originally issued before October 1, 1993; or (bb) obtained from collections or default reim- bursements on, or interest or other income pertaining to, eligible loans made or purchased with funds de- scribed in division (aa), or from income on the invest- ment of such funds; and (II) are— (aa) financed by such an obligation that, after September 30, 2004, has matured or been retired or defeased; (bb) refinanced after September 30, 2004, with funds obtained from a source other than funds de- scribed in subclause (I) of this clause; or (cc) sold or transferred to any other holder after September 30, 2004.
(vi) Notwithstanding clauses (i), (ii), and (v), but subject to clause (vii), the quarterly rate of the special allowance shall be the rate determined under subparagraph (A), (E), (F), (G), (H), or (I) of this paragraph, as the case may be, for a holder of loans— (I) that were made or purchased on or after the date of enactment of the Higher Education Reconciliation Act of 2005; or (II) that were not earning a quarterly rate of special allowance determined under clauses (i) or (ii) of subpara- graph (B) of this paragraph (20 U.S.C.
1087–1(b)(2)(b)) as September 8, 2023 As Amended Through P.L.

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438 HIGHER EDUCATION ACT OF 1965 422 of the date of enactment of the Higher Education Rec- onciliation Act of 2005.
(vii) Clause (vi) shall be applied by substituting ‘‘December 31, 2010’’ for ‘‘the date of enactment of the Higher Education Reconciliation Act of 2005’’ in the case of a holder of loans that— (I) was, as of the date of enactment of the Higher Edu- cation Reconciliation Act of 2005, and during the quarter for which the special allowance is paid, a unit of State or local government or a nonprofit private entity; (II) was, as of such date of enactment, and during such quarter, not owned or controlled by, or under common ownership or control with, a for-profit entity; and (III) held, directly or through any subsidiary, affiliate, or trustee, a total unpaid balance of principal equal to or less than $100,000,000 on loans for which special allow- ances were paid under this subparagraph in the most re- cent quarterly payment prior to September 30, 2005.
(C)(i) In the case of loans made before October 1, 1992, pursuant to section 428A or 428B for which the interest rate is determined under section 427A(c)(4), a special allowance shall not be paid unless the rate determined for any 12-month period under subparagraph (B) of such section exceeds 12 per- cent.
(ii) Subject to subparagraphs (G), (H), and (I), in the case of loans disbursed on or after October 1, 1992, pursuant to sec- tion 428A or 428B for which the interest rate is determined under section 427A(c)(4), a special allowance shall not be paid unless the rate determined for any 12-month period under sec- tion 427A(c)(4)(B) exceeds— (I) 11 percent in the case of a loan under section 428A; or (II) 10 percent in the case of a loan under section 428B.
(D)(i) In the case of loans made or purchased directly from funds loaned or advanced pursuant to a qualified State obliga- tion, subparagraph (A)(iii) shall be applied by substituting ‘‘3.5 percent’’ for ‘‘3.10 percent’’.
(ii) For the purpose of division (i) of this subparagraph, the term ‘‘qualified State obligation’’ means— (I) an obligation of the Maine Educational Loan Mar- keting Corporation to the Student Loan Marketing Asso- ciation pursuant to an agreement entered into on January 31, 1984; or (II) an obligation of the South Carolina Student Loan Corporation to the South Carolina National Bank pursu- ant to an agreement entered into on July 30, 1986.
(E) In the case of any loan for which the applicable rate of interest is described in section 427A(g)(2), subparagraph (A)(iii) shall be applied by substituting ‘‘2.5 percent’’ for ‘‘3.10 percent’’.

(F) Subject to paragraph (4), the special allowance paid pursuant to this subsection on loans for which the applicable rate of interest is determined under section 427A(h) shall be September 8, 2023 As Amended Through P.L.
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438 computed (i) by determining the applicable bond equivalent rate of the security with a comparable maturity, as established by the Secretary, (ii) by subtracting the applicable interest rates on such loans from such applicable bond equivalent rate, (iii) by adding 1.0 percent to the resultant percent, and (iv) by dividing the resultant percent by 4.

If such computation pro- duces a number less than zero, such loans shall be subject to section 427A(i).
(G) LOANS DISBURSED BETWEEN JULY 1, 1998, AND OCTOBER 1, 1998.— (i) IN GENERAL.—Subject to paragraph (4) and clauses (ii), (iii), and (iv) of this subparagraph, and except as pro- vided in subparagraph (B), the special allowance paid pur- suant to this subsection on loans for which the first dis- bursement is made on or after July 1, 1998, and before Oc- tober 1, 1998, shall be computed— (I) by determining the average of the bond equiva- lent rates of 91-day T (II) by subtracting the applicable interest rates on such loans from such average bond equivalent rate; (III) by adding 2.8 percent to the resultant per- cent; and (IV) by dividing the resultant percent by 4.
(ii) IN SCHOOL AND GRACE PERIOD.—In the case of any loan for which the first disbursement is made on or after July 1, 1998, and before October 1, 1998, and for which the applicable rate of in section 427A(j)(2), clause (i)(III) of this subparagraph shall be ap- plied by substituting ‘‘2.2 percent’’ for ‘‘2.8 percent’’.
is described interest (iii) PLUS LOANS.—In the case of any loan for which the first disbursement is made on or after July 1, 1998, and before October 1, 1998, and for which the applicable rate of interest is described in section 427A(j)(3), clause (i)(III) of this subparagraph shall be applied by sub- stituting ‘‘3.1 percent’’ for ‘‘2.8 percent’’, subject to clause (v) of this subparagraph.

(iv) CONSOLIDATION LOANS.—This subparagraph shall not apply in the case of any consolidation loan.
(v) LIMITATION ON SPECIAL ALLOWANCES FOR PLUS LOANS.—In the case of PLUS loans made under section 428B and disbursed on or after July 1, 1998, and before October 1, 1998, for which the interest rate is determined under 427A(j)(3), a special allowance shall not be paid for such loan for such 40 unless the rate determined under subparagraph (A) of such section (without regard to sub- paragraph (B) of such section) exceeds 9.0 percent.
(H) 41 LOANS DISBURSED ON OR AFTER OCTOBER 1, 1998, AND BEFORE JANUARY 1, 2000.— (i) IN GENERAL.—Subject to paragraph (4) and clauses (ii), (iii), and (iv) of this subparagraph, and ex- cept as provided in subparagraph (B), the special al- September 8, 2023 As Amended Through P.L.

117-286, Enacted December 27, 2022 40 So in original.

41 Margin so in law.


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438 HIGHER EDUCATION ACT OF 1965 424 lowance paid pursuant to this subsection on loans for which the first disbursement is made on or after Octo- ber 1, 1998, and before January 1, 2000, shall be com- puted— (I) by determining the average of the bond equivalent rates of 91-day Treasury bills auc- tioned for such 3-month period; (II) by subtracting the applicable interest rates on such loans from such average bond equiv- alent rate; (III) by adding 2.8 percent to the resultant percent; and (IV) by dividing the resultant percent by 4.
(ii) IN SCHOOL AND GRACE PERIOD.—In the case of any loan for which the first disbursement is made on or after October 1, 1998, and before January 1, 2000, and for which the applicable rate of interest is de- scribed in section 427A(k)(2), clause (i)(III) of this sub- paragraph shall be applied by substituting ‘‘2.2 per- cent’’ for ‘‘2.8 percent’’.
(iii) PLUS LOANS.—In the case of any loan for which the first disbursement is made on or after Octo- ber 1, 1998, and before January 1, 2000, and for which the applicable rate of interest is described in section 427A(k)(3), clause (i)(III) of this subparagraph shall be applied by substituting ‘‘3.1 percent’’ for ‘‘2.8 percent’’, subject to clause (v) of this subparagraph.
(iv) CONSOLIDATION LOANS.—In the case of any consolidation loan for which the application is received by an eligible lender on or after October 1, 1998, and before January 1, 2000, and for which the applicable interest rate is determined under section 427A(k)(4), clause (i)(III) of this subparagraph shall be applied by substituting ‘‘3.1 percent’’ for ‘‘2.8 percent’’, subject to clause (vi) of this subparagraph.
(v) LIMITATION ON SPECIAL ALLOWANCES FOR PLUS LOANS.—In the case of PLUS loans made under sec- tion 428B and first disbursed on or after October 1, 1998, and before January 1, 2000, for which the inter- est rate is determined under section 427A(k)(3), a spe- cial allowance shall not be paid for such loan during any 12-month period beginning on July 1 and ending on June 30 unless, on the June 1 preceding such July 1— (I) the bond equivalent rate of 91-day Treas- ury bills auctioned at the final auction held prior to such June 1 (as determined by the Secretary for purposes of such section); plus (II) 3.1 percent, exceeds 9.0 percent.
(vi) LIMITATION ON SPECIAL ALLOWANCES FOR CON- SOLIDATION LOANS.—In the case of consolidation loans made under section 428C and for which the applica- tion is received on or after October 1, 1998, and before September 8, 2023 As Amended Through P.L.

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438 January 1, 2000, for which the interest rate is deter- mined under section 427A(k)(4), a special allowance shall not be paid for such loan during any 3-month pe- riod ending March 31, June 30, September 30, or De- cember 31 unless— (I) the average of the bond equivalent rate of 91-day Treasury bills auctioned for such 3-month period; plus (II) 3.1 percent, exceeds the rate determined under section 427A(k)(4).
(I) 42 LOANS DISBURSED ON OR AFTER JANUARY 1, 2000, (i) IN GENERAL.—Notwithstanding subparagraphs (G) and (H), but subject to paragraph (4) and the fol- lowing clauses of this subparagraph, and except as provided in subparagraph (B), the special allowance paid pursuant to this subsection on loans for which the first disbursement is made on or after January 1, 2000, and before July 1, 2010, shall be computed— AND BEFORE JULY 1, 2010.— (I) by determining the average of the bond equivalent rates of the quotes of the 3-month com- mercial paper (financial) rates in effect for each of the days in such quarter as reported by the Fed- eral Reserve in Publication H–15 (or its successor) for such 3-month period; (II) by subtracting the applicable interest rates on such loans from the rate determined under subclause (I) (in accordance with clause (vii)); (III) by adding 2.34 percent to the resultant percent; and (IV) by dividing the resultant percent by 4.
(ii) IN SCHOOL AND GRACE PERIOD.—In the case of any loan— (I) for which the first disbursement is made on or after January 1, 2000, and before July 1, 2006, and for which the applicable rate of interest is described in section 427A(k)(2); or (II) for which the first disbursement is made on or after July 1, 2006, and before July 1, 2010, and for which the applicable rate of interest is de- scribed in section section 427A(l)(1) or (l)(4), but only with respect to (aa) periods prior to the be- ginning of the repayment period of the loan; or (bb) during the periods in which principal need not be paid (whether or not such principal is in fact paid) by reason of a provision described in section 427(a)(2)(C) or 428(b)(1)(M); clause (i)(III) of this subparagraph shall be applied by substituting ‘‘1.74 percent’’ for ‘‘2.34 percent’’.
(iii) PLUS LOANS.—In the case of any loan for which the first disbursement is made on or after Janu- September 8, 2023 As Amended Through P.L.

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438 HIGHER EDUCATION ACT OF 1965 426 ary 1, 2000, and before July 1, 2010, and for which the applicable rate of interest is described in section 427A(k)(3) or (l)(2), clause (i)(III) of this subparagraph shall be applied by substituting ‘‘2.64 percent’’ for ‘‘2.34 percent’’.
(iv) CONSOLIDATION LOANS.—In the case of any consolidation loan for which the application is received by an eligible lender on or after January 1, 2000, and that is disbursed before July 1, 2010, and for which the applicable interest rate is determined under sec- tion 427A(k)(4) or (l)(3), clause (i)(III) of this subpara- graph shall be applied by substituting ‘‘2.64 percent’’ for ‘‘2.34 percent’’.
(v) RECAPTURE OF EXCESS INTEREST.— (I) EXCESS CREDITED.—With respect to a loan on which the applicable interest rate is deter- mined under subsection (k) or (l) of section 427A and for which the first disbursement of principal is made on or after April 1, 2006, and before July 1, 2010, if the applicable interest rate for any 3- month period exceeds the special allowance sup- port level applicable to such loan under this sub- paragraph for such period, then an adjustment shall be made by calculating the excess interest in the amount computed under subclause (II) of this clause, and by crediting the excess interest to the Government not less often than annually.
(II) CALCULATION OF EXCESS.—The amount of any adjustment of interest on a loan to be made under this subsection for any quarter shall be equal to— (aa) the applicable interest rate minus the special allowance support level deter- mined under this subparagraph; multiplied by (bb) the average daily principal balance of the loan (not including unearned interest added to principal) during such calendar quarter; divided by (cc) four.
(III) SPECIAL ALLOWANCE SUPPORT LEVEL.— For purposes of this clause, the term ‘‘special al- lowance support level’’ means, for any loan, a number expressed as a percentage equal to the sum of the rates determined under subclauses (I) and (III) of clause (i), and applying any substi- tution rules applicable to such loan under clauses (ii), (iii), (iv), (vi), and (vii) in determining such sum.
(vi) REDUCTION FOR LOANS DISBURSED ON OR AFTER OCTOBER 1, 2007, AND BEFORE JULY 1, 2010.— With respect to a loan on which the applicable interest rate is determined under section 427A(l) and for which the first disbursement of principal is made on or after October 1, 2007, and before July 1, 2010, the special September 8, 2023 As Amended Through P.L.
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438 allowance payment computed pursuant to this sub- paragraph shall be computed— (I) for loans held by an eligible lender not de- scribed in subclause (II)— (aa) by substituting ‘‘1.79 percent’’ for ‘‘2.34 percent’’ each place the term appears in this subparagraph; (bb) by substituting ‘‘1.19 percent’’ for ‘‘1.74 percent’’ in clause (ii); (cc) by substituting ‘‘1.79 percent’’ for ‘‘2.64 percent’’ in clause (iii); and (dd) by substituting ‘‘2.09 percent’’ for ‘‘2.64 percent’’ in clause (iv); and (II) for loans held by an eligible not-for-profit (aa) by substituting ‘‘1.94 percent’’ for ‘‘2.34 percent’’ each place the term appears in this subparagraph; (bb) by substituting ‘‘1.34 percent’’ for ‘‘1.74 percent’’ in clause (ii); (cc) by substituting ‘‘1.94 percent’’ for holder— ‘‘2.64 percent’’ in clause (iii); and (dd) by substituting ‘‘2.24 percent’’ for ‘‘2.64 percent’’ in clause (iv).
(vii) REVISED CALCULATION RULE TO REFLECT FI- NANCIAL MARKET CONDITIONS.— (I) CALCULATION BASED ON LIBOR.—For the calendar quarter beginning on April 1, 2012 and each subsequent calendar quarter, in computing the special allowance paid pursuant to this sub- section with respect to loans described in sub- clause (II), clause (i)(I) of this subparagraph shall be applied by substituting ‘‘of the 1-month London Inter Bank Offered Rate (LIBOR) for United States dollars in effect for each of the days in such quarter as compiled and released by the British Bankers Association’’ for ‘‘of the quotes of the 3- month commercial paper (financial) rates in effect for each of the days in such quarter as reported by the Federal Reserve in Publication H–15 (or its successor) for such 3-month period’’.
(II) LOANS ELIGIBLE FOR LIBOR-BASED CAL- CULATION.—The special allowance paid pursuant to this subsection shall be calculated as described in subclause (I) with respect to special allowance payments for the 3-month period ending June 30, 2012, and each succeeding 3-month period, on loans for which the first disbursement is made on or after January 1, 2000, and before July 1, 2010, if, not later than April 1, 2012, the holder of the loan (or, if the holder acts as eligible lender trust- ee for the beneficial owner of the loan, the bene- ficial owner of the loan), affirmatively and perma- nently waives all contractual, statutory, or other September 8, 2023 As Amended Through P.L.
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438 HIGHER EDUCATION ACT OF 1965 428 legal rights to a special allowance paid pursuant to this subsection that is calculated using the for- mula in effect at the time the loans were first dis- bursed.
(III) TERMS OF WAIVER.— (aa) IN GENERAL.—A waiver pursuant to subclause (II) shall be in a form (printed or electronic) prescribed by the Secretary, and shall be applicable to— (AA) all loans described in such sub- clause that the lender holds solely in its own right under any lender identification number associated with the holder (pur- suant to section 487B); (BB) all loans described in such sub- clause for which the beneficial owner has the authority to make an election of a waiver under such subclause, regardless of the lender identification number associ- ated with the loan or the lender that holds the loan as eligible lender trustee on behalf of such beneficial owner; and (CC) all future calculations of the special allowance on loans that, on the date of such waiver, are loans described in subitem (AA) or (BB), or that, after such date, become loans described in subitem (AA) or (BB).
(bb) EXCEPTIONS.—Any waiver pursuant to subclause (II) that is elected for loans de- scribed in subitem (AA) or (BB) of item (aa) shall not apply to any loan described in such subitem for which the lender or beneficial owner of the loan demonstrates to the satis- faction of the Secretary that— (AA) in accordance with an agree- ment entered into before the date of en- actment of this section 43 by which such lender or owner is governed and that ap- plies to such loans, such lender or owner is not legally permitted to make an elec- tion of such waiver with respect to such loans without the approval of one or more third parties with an interest in the loans, and that the lender or owner fol- lowed all available options under such agreement to obtain such approval, and was unable to do so; or (BB) such lender or beneficial owner presented the proposal of electing such a waiver applicable to such loans associated with an obligation rated by a nationally September 8, 2023 As Amended Through P.L.
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The reference in (AA) to ‘‘this section’’ probably should be to ‘‘this clause’’.

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438 recognized statistical rating organization (as defined in section 3(a)(62) of the Secu- rities Exchange Act of 1934), and such rating organization provided a written opinion that the agency would downgrade the rating applicable to such obligation if the lender or owner elected such a waiv- er.
(viii) REVISED CALCULATION RULE TO ADDRESS IN- STANCES WHERE 1-MONTH USD LIBOR CEASES OR IS NON- REPRESENTATIVE.— (I) SUBSTITUTE REFERENCE INDEX.—The provi- sions of this clause apply to loans for which the special allowance payment would otherwise be cal- culated pursuant to clause (vii).

(II) CALCULATION BASED ON SOFR.—For loans described in subclause (III) or (IV), the special al- lowance payment described in this subclause shall be substituted for the payment provided under clause (vii).
For each calendar quarter, the for- mula for computing the special allowance that would otherwise apply under clause (vii) shall be revised by substituting ‘‘of the quotes of the 30- day Average Secured Overnight Financing Rate (SOFR) in effect for each of the days in such quar- ter as published by the Federal Reserve Bank of New York (or a successor administrator), adjusted daily by adding the tenor spread adjustment, as that term is defined in the Adjustable Interest Rate (LIBOR) Act, for 1-month LIBOR contracts of 0.11448 percent’’ for ‘‘of the 1-month London Inter Bank Offered Rate (LIBOR) for United States dollars in effect for each of the days in such quarter as compiled and released by the British Bankers Association’’.
The special allowance cal- culation for loans subject to clause (vii) shall oth- erwise remain in effect.
(III) LOANS ELIGIBLE FOR SOFR-BASED CAL- CULATION.—Except as provided in subclause (IV), the special allowance payment calculated under subclause (II) shall apply to all loans for which the holder (or, if the holder acts as an eligible lender trustee for the beneficial owner of the loan, the beneficial owner of the loan) at any time after the effective date of this clause notifies the Sec- retary that the holder or beneficial owner affirma- tively and permanently elects to waive all contrac- tual, statutory, or other legal rights to a special allowance paid under clause (vii) or to the special allowance paid pursuant to any other formula that was previously in effect with respect to such loan, and accepts the rate described in subclause (II).
Any such waiver shall apply to all loans then held, or to be held from time to time, by such September 8, 2023 As Amended Through P.L.

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438 HIGHER EDUCATION ACT OF 1965 430 holder or beneficial owner; provided that, due to the need to obtain the approval of, demonstrated to the satisfaction of the Secretary— (aa) one or more third parties with a legal or beneficial interest in loans eligible for the SOFR-based calculation; or (bb) a nationally recognized rating organi- zation assigning a rating to a financing se- cured by loans otherwise eligible for the SOFR-based calculation, the holder of the loan (or, if the holder acts as an eligible lender trustee for the beneficial owner of the loan, the beneficial owner of the loan) may elect to apply the rate described in subclause (II) to specified loan portfolios established for financ- ing purposes by separate notices with different ef- fective dates.
The special allowance rate based on SOFR shall be effective with respect to a portfolio as of the first day of the calendar quarter fol- lowing the applicable effective date of the waiver received by the Secretary from the holder or bene- ficial owner and shall permanently and irrev- ocably continue for all subsequent quarters.
(IV) FALLBACK PROVISIONS.— (aa) In the event that a holder or bene- ficial owner has not elected to waive its rights to a special allowance payment under clause (vii) with respect to a portfolio with an effec- tive date of the waiver prior to the first of— (AA) the date on which the ICE Benchmark Administration (‘‘IBA’’) has permanently or indefinitely stopped pro- viding the 1-month United States Dollar LIBOR (‘‘1-month USD LIBOR’’) to the general public; (BB) the effective date of an official public statement by the IBA or its regu- lator that the 1-month USD LIBOR is no longer reliable or no longer representa- tive; or (CC) the LIBOR replacement date, as defined in section 103 of the Adjustable Interest Rate (LIBOR) Act, the special allowance rate calculation as de- scribed in subclause (II) shall, by operation of law, apply to all loans in such portfolio.
(bb) In such event— (AA) the last determined rate of spe- cial allowance based on 1-month USD LIBOR will continue to apply until the end of the then current calendar quarter; and (BB) the special allowance rate cal- culation as described in subclause (II) September 8, 2023 As Amended Through P.L.
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438 shall become effective as of the first day of the following calendar quarter and re- main in effect for all subsequent calendar quarters.
(3) CONTRACTUAL RIGHT OF HOLDERS TO SPECIAL ALLOW- ANCE.—The holder of an eligible loan shall be deemed to have a contractual right against the United States, during the life of such loan, to receive the special allowance according to the provisions of this section.
The special allowance determined for any such 3-month period shall be paid promptly after the close of such period, and without administrative delay after receipt of an accurate and complete request for payment, pursuant to procedures established by regulations promulgated under this section.
(4) PENALTY FOR LATE PAYMENT.—(A) If payments of the special allowances payable under this section or of interest payments under section 428(a) with respect to a loan have not been made within 30 days after the Secretary has received an accurate, timely, and complete request for payment thereof, the special allowance payable to such holder shall be increased by an amount equal to the daily interest accruing on the special allowance and interest benefits payments due the holder.
(B) Such daily interest shall be computed at the daily equivalent rate of the sum of the special allowance rate com- puted pursuant to paragraph (2) and the interest rate applica- ble to the loan and shall be paid for the later of (i) the 31st day after the receipt of such request for payment from the holder, or (ii) the 31st day after the final day of the period or periods covered by such request, and shall be paid for each suc- ceeding day until, and including, the date on which the Sec- retary authorizes payment.
(C) For purposes of reporting to the Congress the amounts of special allowances paid under this section, amounts of spe- cial allowances paid pursuant to this paragraph shall be seg- regated and reported separately.
(5) DEFINITION OF ELIGIBLE LOAN.—As used in this section, the term ‘‘eligible loan’’ means a loan— (A)(i) on which a portion of the interest is paid on be- half of the student and for the student’s account to the holder of the loan under section 428(a); (ii) which is made under section 428A, 428B, 428C, 428H, or 439(o); or (iii) which was made prior to October 1, 1981; and (B) which is insured under this part, or made under a program covered by an agreement under section 428(b) of this Act.
(6) REGULATION OF TIME AND MANNER OF PAYMENT.—The Secretary shall pay the holder of an eligible loan, at such time or times as are specified in regulations, a special allowance prescribed pursuant to this subsection subject to the condition that such holder shall submit to the Secretary, at such time or times and in such a manner as the Secretary may deem prop- er, such information as may be required by regulation for the September 8, 2023 As Amended Through P.L.
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438 HIGHER EDUCATION ACT OF 1965 432 purpose of enabling the Secretary to carry out his functions under this section and to carry out the purposes of this section.
(7) USE OF AVERAGE QUARTERLY BALANCE.—The Secretary shall permit lenders to calculate interest benefits and special allowance through the use of the average quarterly balance method until July 1, 1988.
(c) ORIGINATION FEES FROM STUDENTS.— (1) DEDUCTION FROM INTEREST AND SPECIAL ALLOWANCE SUBSIDIES.—(A) Notwithstanding subsection (b), the Secretary shall collect the amount the lender is authorized to charge as an origination fee in accordance with paragraph (2) of this sub- section— (i) by reducing the total amount of interest and special allowance payable under section 428(a)(3)(A) and sub- section (b) of this section, respectively, to any holder; or (ii) directly from the holder of the loan, if the lender fails or is not required to bill the Secretary for interest and special allowance or withdraws from the program with un- paid loan origination fees.
(B) If the Secretary collects the origination fee under this subsection through the reduction of interest and special allow- ance, and the total amount of interest and special allowance payable under section 428(a)(3)(A) and subsection (b) of this section, respectively, is less than the amount the lender was authorized to charge borrowers for origination fees in that quarter, the Secretary shall deduct the excess amount from the subsequent quarters’ payments until the total amount has been deducted.
(2) AMOUNT OF ORIGINATION FEES.— (A) IN GENERAL.—Subject to paragraph (6) of this sub- section, with respect to any loan (including loans made under section 428H, but excluding loans made under sec- tions 428C and 439(o)) for which a completed note or other written evidence of the loan was sent or delivered to the borrower for signing on or after 10 days after the date of enactment of the Postsecondary Student Assistance Amendments of 1981, each eligible lender under this part is authorized to charge the borrower an origination fee in an amount not to exceed 3.0 percent of the principal amount of the loan, to be deducted proportionately from each installment payment of the proceeds of the loan prior to payment to the borrower.
Except as provided in para- graph (8), a lender that charges an origination fee under this paragraph shall assess the same fee to all student bor- rowers.
(B) SUBSEQUENT (A) shall be applied to loans made under this part (other than loans made under sections 428C and 439(o))— REDUCTIONS.—Subparagraph (i) by substituting ‘‘2.0 percent’’ for ‘‘3.0 percent’’ with respect to loans for which the first disbursement of principal is made on or after July 1, 2006, and be- fore July 1, 2007; (ii) by substituting ‘‘1.5 percent’’ for ‘‘3.0 percent’’ with respect to loans for which the first disbursement September 8, 2023 As Amended Through P.L.
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438 of principal is made on or after July 1, 2007, and be- fore July 1, 2008; (iii) by substituting ‘‘1.0 percent’’ for ‘‘3.0 percent’’ with respect to loans for which the first disbursement of principal is made on or after July 1, 2008, and be- fore July 1, 2009; and (iv) by substituting ‘‘0.5 percent’’ for ‘‘3.0 percent’’ with respect to loans for which the first disbursement of principal is made on or after July 1, 2009, and be- fore July 1, 2010.
(3) RELATION TO APPLICABLE INTEREST.—Such origination fee shall not be taken into account for purposes of determining compliance with section 427A.

(4) DISCLOSURE REQUIRED.—The lender shall disclose to the borrower the amount and method of calculating the origi- nation fee.
(5) PROHIBITION ON DEPARTMENT COMPELLING ORIGINATION FEE COLLECTIONS BY LENDERS.—Nothing in this subsection shall be construed to permit the Secretary to require any lend- er that is making loans that are insured or guaranteed under this part, but for which no amount will be payable for interest under section 428(a)(3)(A) or for special allowances under sub- section (b) of this section, to collect any origination fee or to submit the sums collected as origination fees to the United States.
The Secretary shall, not later than January 1, 1987, re- turn to any such lender any such sums collected before the en- actment of this paragraph, together with interest thereon.
(6) SLS AND PLUS LOANS.—With respect to any loans made under section 428A or 428B on or after October 1, 1992, and first disbursed before July 1, 2010, each eligible lender under this part shall charge the borrower an origination fee of 3.0 percent of the principal amount of the loan, to be deducted pro- portionately from each installment payment of the proceeds of the loan prior to payments to the borrower.
(7) DISTRIBUTION OF ORIGINATION FEES.—All origination fees collected pursuant to this section on loans authorized under section 428A or 428B shall be paid to the Secretary by the lender and deposited in the fund authorized under section 431 of this part.

(8) EXCEPTION.—Notwithstanding paragraph (2), a lender may assess a lesser origination fee for a borrower dem- onstrating greater financial need as determined by such bor- rower’s adjusted gross family income.
(d) LOAN FEES FROM LENDERS.— (1) DEDUCTION FROM INTEREST AND SPECIAL ALLOWANCE SUBSIDIES.— (A) IN GENERAL.—Notwithstanding subsection (b), the Secretary shall collect a loan fee in an amount determined in accordance with paragraph (2)— (i) by reducing the total amount of interest and special allowance payable under section 428(a)(3)(A) and subsection (b), respectively, to any holder of a loan; or September 8, 2023 As Amended Through P.L.
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438 HIGHER EDUCATION ACT OF 1965 434 (ii) directly from the holder of the loan, if the lend- er— (I) fails or is not required to bill the Secretary for interest and special allowance payments; or (II) withdraws from the program with unpaid loan fees.
special allowance payable under (B) SPECIAL RULE.—If the Secretary collects loan fees under this subsection through the reduction of interest and special allowance payments, and the total amount of inter- est and section 428(a)(3)(A) and subsection (b), respectively, is less than the amount of such loan fees, then the Secretary shall de- duct the amount of the loan fee balance from the amount of interest and special allowance payments that would oth- erwise be payable, in subsequent quarterly increments until the balance has been deducted.
(2) AMOUNT OF LOAN FEES.—The amount of the loan fee which shall be deducted under paragraph (1), but which may not be collected from the borrower, shall be equal to— (A) except as provided in subparagraph (B), 0.50 per- cent of the principal amount of the loan with respect to any loan under this part for which the first disbursement was made on or after October 1, 1993; and (B) 1.0 percent of the principal amount of the loan with respect to any loan under this part for which the first disbursement was made on or after October 1, 2007, and before July 1, 2010.
(3) DISTRIBUTION OF LOAN FEES.—The Secretary shall de- posit all fees collected pursuant to paragraph (3) into the in- surance fund established in section 431.
(e) NONDISCRIMINATION.—In order for the holders of loans which were made or purchased with funds obtained by the holder from an Authority issuing obligations, the income from which is ex- empt from taxation under the Internal Revenue Code of 1986, to be eligible to receive a special allowance under subsection (b)(2) on any such loans, the Authority shall not engage in any pattern or practice which results in a denial of a borrower’s access to loans under this part because of the borrower’s race, sex, color, religion, national origin, age, disability status, income, attendance at a par- ticular eligible institution within the area served by the Authority, length of the borrower’s educational program, or the borrower’s academic year in school.
(f) REGULATIONS TO PREVENT DENIAL OF LOANS TO ELIGIBLE STUDENTS.—The Secretary shall adopt or amend appropriate regu- lations pertaining to programs carried out under this part to pre- vent, where practicable, any practices which the Secretary finds have denied loans to a substantial number of eligible students.

(g) SPECIAL RULE.—With respect to any loan made under this part for which the is determined under the Servicemembers Civil Relief Act (50 U.S.C.

App.
App.

527), the applica- ble interest rate to be subtracted in calculating the special allow- ance for such loan under this section shall be the interest rate de- termined under that Act for such loan.

interest rate September 8, 2023 As Amended Through P.L.

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439 SEC.
439 SEC.

439. ø20 U.S.C.

1087–2¿ 44 STUDENT LOAN MARKETING ASSOCIA- TION.
(a) PURPOSE.—The Congress hereby declares that it is the pur- pose of this section (1) to establish a private corporation which will be financed by private capital and which will serve as a secondary market and warehousing facility for student loans, including loans which are insured by the Secretary under this part or by a guar- anty agency, and which will provide liquidity for student loan in- vestments; (2) in order to facilitate secured transactions involving student loans, to provide for perfection of security interests in stu- dent loans either through the taking of possession or by notice fil- ing; and (3) to assure nationwide the establishment of adequate loan insurance programs for students, to provide for an additional program of loan insurance to be covered by agreements with the Secretary.
(b) ESTABLISHMENT.— (1) IN GENERAL.—There is hereby created a body corporate to be known as the Student Loan Marketing Association (here- inafter referred to as the ‘‘Association’’).

The Association shall have succession until dissolved.

It shall maintain its principal office in the District of Columbia and shall be deemed, for pur- poses of venue and jurisdiction in civil actions, to be a resident and citizen thereof.
Offices may be established by the Associa- tion in such other place or places as it may deem necessary or appropriate for the conduct of its business.
(2) EXEMPTION FROM STATE AND LOCAL TAXES.—The Asso- ciation, including its franchise, capital, reserves, surplus, mort- gages, or other security holdings, and income shall be exempt from all taxation now or hereafter imposed by any State, terri- tory, possession, Commonwealth, or dependency of the United States, or by the District of Columbia, or by any county, mu- nicipality, or local taxing authority, except that any real prop- erty of the Association shall be subject to State, territorial, county, municipal, or local taxation to the same extent accord- ing to its value as other real property is taxed.
(3) APPROPRIATIONS AUTHORIZED FOR ESTABLISHMENT.— There is hereby authorized to be appropriated to the Secretary $5,000,000 for making advances for the purpose of helping to establish the Association.

Such advances shall be repaid within such period as the Secretary may deem to be appropriate in light of the maturity and solvency of the Association.
Such ad- vances shall bear interest at a rate not less than (A) a rate de- termined by the Secretary of the Treasury taking into consider- ation the current average market yield on outstanding market- 44 Section 602(d) of Public Law 104–208 (110 Stat.

3009–300) provides for the following re- peals: (d) REPEALS.— (1) IN GENERAL.—Sections 439 of the Higher Education Act of 1965 (20 U.S.C.

1087–2) and 440 of such Act (as added by subsection (a) of this section) are repealed.
(2) EFFECTIVE DATE.—The repeals made by paragraph (1) shall be effective one year after— (A) the date on which all of the obligations of the trust established under section 440(d)(1) of the Higher Education Act of 1965 (as added by subsection (a)) have been extinguished, if a reorganization occurs in accordance with section 440 of such Act; or (B) the date on which all of the obligations of the trust established under subsection 439(s)(3)(A) of such Act (as added by subsection (c)) have been extinguished, if a reorga- nization does not occur in accordance with section 440 of such Act.
September 8, 2023 As Amended Through P.L.

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439 HIGHER EDUCATION ACT OF 1965 436 able obligations of the United States with remaining period to maturity comparable to the maturity of such advances, ad- justed to the nearest one-eighth of 1 percent, plus (B) an allow- ance adequate in the judgment of the Secretary to cover ad- ministrative costs and probable losses.

Repayments of such ad- vances shall be deposited into miscellaneous receipts of the Treasury.
(c) BOARD OF DIRECTORS.— (1) COMPOSITION OF BOARD; CHAIRMAN.—(A) The Associa- tion shall have a Board of Directors which shall consist of 21 persons, 7 of whom shall be appointed by the President and shall be representative of the general public.

The remaining 14 directors shall be elected by the common stockholders of the Association entitled to vote pursuant to subsection (f).
Com- mencing with the annual shareholders meeting to be held in 1993— (i) 7 of the elected directors shall be affiliated with an eligible institution; and (ii) 7 of the elected directors shall be affiliated with an eligible lender.

(B) The President shall designate 1 of the directors to serve as Chairman.

(2) TERMS OF APPOINTED AND ELECTED MEMBERS.—The di- rectors appointed by the President shall serve at the pleasure of the President and until their successors have been appointed and have qualified.
The remaining directors shall each be elect- ed for a term ending on the date of the next annual meeting of the common stockholders of the Association, and shall serve until their successors have been elected and have qualified.

Any appointive seat on the Board which becomes vacant shall be filled by appointment of the President.

Any elective seat on the Board which becomes vacant after the annual election of the directors shall be filled by the Board, but only for the unex- pired portion of the term.
(3) AFFILIATED MEMBERS.—For the purpose of this sub- section, the references to a director ‘‘affiliated with the eligible institution’’ or a director ‘‘affiliated with an eligible lender’’ means an individual who is, or within 5 years of election to the Board has been, an employee, officer, director, or similar offi- cial of— (A) an eligible institution or an eligible lender; (B) an association whose members consist primarily of eligible institutions or eligible lenders; or (C) a State agency, authority, instrumentality, com- mission, or similar institution, the primary purpose of which relates to educational matters or banking matters.
(4) MEETINGS AND FUNCTIONS OF THE BOARD.—The Board of Directors shall meet at the call of its Chairman, but at least semiannually.

The Board shall determine the general policies which shall govern the operations of the Association.
The Chairman of the Board shall, with the approval of the Board, select, appoint, and compensate qualified persons to fill the of- fices as may be provided for in the bylaws, with such functions, powers, and duties as may be prescribed by the bylaws or by September 8, 2023 As Amended Through P.L.
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439 the Board of Directors, and such persons shall be the officers of the Association and shall discharge all such functions, pow- ers, and duties.
(d) AUTHORITY OF ASSOCIATION.— (1) IN GENERAL.—The Association is authorized, subject to the provisions of this section— (A) pursuant to commitments or otherwise to make ad- vances on the security of, purchase, or repurchase, service, sell or resell, offer participations, or pooled interests or otherwise deal in, at prices and on terms and conditions determined by the Association, student loans which are in- sured by the Secretary under this part or by a guaranty agency; (B) to buy, sell, hold, underwrite, and otherwise deal in obligations, if such obligations are issued, for the pur- pose of making or purchasing insured loans, by a guaranty agency or by an eligible lender in a State described in sec- tion 435(d)(1) (D) or (F); (C) to buy, sell, hold, insure, underwrite, and other- wise deal in obligations issued for the purpose of financing or refinancing the construction, reconstruction, renovation, improvement, or purchase at institutions of higher edu- cation of any of the following facilities (including the un- derlying property) and materials (including related equip- ment, instrumentation, and furnishings) at an eligible in- stitution of higher education: (i) educational and training facilities; (ii) housing for students and faculties, dining halls, student unions, and facilities specifically de- signed to promote fitness and health for students, fac- ulty, and staff or for physical education courses; and (iii) library facilities, including the acquisition of library materials at institutions of higher education; except that not more than 30 percent of the value of trans- actions entered into under this subparagraph shall involve transactions of the types described in clause (ii); (D) to undertake a program of loan insurance pursu- ant to agreements with the Secretary under section 428, and except with respect to loans under subsection (o) of this section or under section 428C, the Secretary may enter into an agreement with the Association for such pur- pose only if the Secretary determines that (i)
 eligible bor- rowers are seeking and unable to obtain loans under this part, and (ii) no guaranty agency is capable of or willing to provide a program of loan insurance for such borrowers; and (E) to undertake any other activity which the Board of Directors of the Association determines to be in further- ance of the programs of insured student loans authorized under this part or will otherwise support the credit needs of students, except that— (i) in carrying out all such activities the purpose shall always be to provide secondary market and other support for lending programs offered by other organi- September 8, 2023 As Amended Through P.L.
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439 HIGHER EDUCATION ACT OF 1965 438 zations and not to replace or compete with such other programs; (ii) nothing in this subparagraph (E) shall be deemed to authorize the Association to acquire, own, operate, or control any bank, savings and loan associa- tion, savings bank or credit union; and (iii) not later than 30 days prior to the initial im- plementation of a program undertaken pursuant to this subparagraph (E), the Association shall advise the Chairman and the Ranking Member on the Committee on Labor and Human Resources of the Senate and the Chairman and the Ranking Member of the Committee on Education and Labor of the House of Representa- tives in writing of its plans to offer such program and shall provide information relating to the general terms and conditions of such program.
The Association is further authorized to undertake any activity with regard to student loans which are not insured or guaran- teed as provided for in this subsection as it may undertake with regard to insured or guaranteed student loans.

Any warehousing advance made on the security of such loans shall be subject to the provisions of paragraph (3) of this subsection to the same extent as a warehousing advance made on the se- curity of insured loans.
(2) WAREHOUSING ADVANCES.—Any warehousing advance made under paragraph (1)(A) of this subsection shall be made on the security of (A) insured loans, (B) marketable obligations and securities issued, guaranteed, or insured by, the United States, or for which the full faith and credit of the United States is pledged for the repayment of principal and interest thereof, or (C) marketable obligations issued, guaranteed, or insured by any agency, instrumentality, or corporation of the United States for which the credit of such agency, instrumen- tality, or corporation is pledged for the repayment of principal and interest thereof, in an amount equal to the amount of such advance.
The proceeds of any such advance secured by insured loans shall either be invested in additional insured loans or the lender shall provide assurances to the Association that during the period of the borrowing it will maintain a level of insured loans in its portfolio not less than the aggregate outstanding balance of such loans held at the time of the borrowing.

The proceeds from any such advance secured by collateral described in clauses (B) and (C) shall be invested in additional insured student loans.
(3) PERFECTION OF SECURITY INTERESTS IN STUDENT LOANS.—Notwithstanding the provisions of any State law to the contrary, including the Uniform Commercial Code as in ef- fect in any State, a security interest in insured student loans created on behalf of the Association or any eligible lender as defined in section 435(a) may be perfected either through the taking of possession of such loans or by the filing of notice of such security interest in such loans in the manner provided by such State law for perfection of security interests in accounts.
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439 (4) FORM OF SECURITIES.—Securities issued pursuant to the offering of participations or pooled interests under para- graph (1) of this subsection may be in the form of debt obliga- tions, or trust certificates of beneficial ownership, or both.

Stu- dent loans set aside pursuant to the offering of participations or pooled interests shall at all times be adequate to ensure the timely principal and interest payments on such securities.
(5) RESTRICTIONS ON FACILITIES AND HOUSING ACTIVITIES.— Not less than 75 percent of the aggregate dollar amount of ob- ligations bought, sold, held, insured, underwritten, and other- wise supported in accordance with the authority contained in paragraph (1)(C) shall be obligations which are listed by a na- tionally recognized statistical rating organization at a rating below the second highest rating of such organization.
(e) ADVANCES TO LENDERS THAT DO NOT DISCRIMINATE.—The Association, pursuant to such criteria as the Board of Directors may prescribe, shall make advances on security or purchase stu- dent loans pursuant to subsection (d) only after the Association is assured that the lender (1) does not discriminate by pattern or practice against any particular class or category of students by re- quiring that, as a condition to the receipt of a loan, the student or his family maintain a business relationship with the lender, except that this clause shall not apply in the case of a loan made by a credit union, savings and loan association, mutual savings bank, institution of higher education, or any other lender with less than $75,000,000 in deposits, and (2) does not discriminate on the basis of race, sex, color, creed, or national origin.
(f) STOCK OF THE ASSOCIATION.— (1) VOTING COMMON STOCK.—The Association shall have voting common stock having such par value as may be fixed by its Board of Directors from time to time.

Each share of voting common stock shall be entitled to one vote with rights of cumu- lative voting at all elections of directors.
(2) NUMBER OF SHARES; TRANSFERABILITY.—The maximum number of shares of voting common stock that the Association may issue and have outstanding at any one time shall be fixed by the Board of Directors from time to time.

Any voting com- mon stock issued shall be fully transferable, except that, as to the Association, it shall be transferred only on the books of the Association.
(3) DIVIDENDS.—To the extent that net income is earned and realized, subject to subsection (g)(2), dividends may be de- clared on voting common stock by the Board of Directors.

Such dividends as may be declared by the Board of Directors shall be paid to the holders of outstanding shares of voting common stock, except that no such dividends shall be payable with re- spect to any share which has been called for redemption past the effective date of such call.
(4) SINGLE CLASS OF VOTING COMMON STOCK.—As of the ef- fective date of the Higher Education Amendments of 1992, all of the previously authorized shares of voting common stock and nonvoting common stock of the Association shall be converted to shares of a single class of voting common stock on a share- for-share basis, without any further action on the part of the September 8, 2023 As Amended Through P.L.
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439 HIGHER EDUCATION ACT OF 1965 440 Association or any holder.

Each outstanding certificate for vot- ing or nonvoting common stock shall evidence ownership of the same number of shares of voting stock into which it is con- verted.
All preexisting rights and obligations with respect to any class of common stock of the Association shall be deemed to be rights and obligations with respect to such converted shares.

(g) PREFERRED STOCK.— (1) AUTHORITY OF BOARD.—The Association is authorized to issue nonvoting preferred stock having such par value as may be fixed by its Board of Directors from time to time.
Any preferred share issued shall be freely transferable, except that, as to the Association, it shall be transferred only on the books of the Association.

(2) RIGHTS OF PREFERRED STOCK.—The holders of the pre- ferred shares shall be entitled to such rate of cumulative divi- dends and such shares shall be subject to such redemption or other conversion provisions as may be provided for at the time of issuance.
No dividends shall be payable on any share of com- mon stock at any time when any dividend is due on any share of preferred stock and has not been paid.

(3) PREFERENCE ON TERMINATION OF BUSINESS.—In the event of any liquidation, dissolution, or winding up of the Asso- ciation’s business, the holders of the preferred shares shall be paid in full at par value thereof, plus all accrued dividends, be- fore the holders of the common shares receive any payment.
(h) DEBT OBLIGATIONS.— (1) APPROVAL BY SECRETARIES OF EDUCATION AND THE TREASURY.—The Association is authorized with the approval of the Secretary of Education and the Secretary of the Treasury to issue and have outstanding obligations having such matu- rities and bearing such rate or rates of interest as may be de- termined by the Association.
The authority of the Secretary of Education to approve the issuance of such obligations is lim- ited to obligations issued by the Association and guaranteed by the Secretary pursuant to paragraph (2) of this subsection.

Such obligations may be redeemable at the option of the Asso- ciation before maturity in such manner as may be stipulated therein.
The Secretary of the Treasury may not direct as a con- dition of his approval that any such issuance of obligations by the Association be made or sold to the Federal Financing Bank.
To the extent that the average outstanding amount of the obligations owned by the Association pursuant to the au- thority contained in subsection (d)(1) (B) and (C) of this section and as to which the income is exempt from taxation under the Internal Revenue Code of 1986 does not exceed the average stockholders’ equity of the Association, the interest on obliga- tions issued under this paragraph shall not be deemed to be interest on indebtedness incurred or continued to purchase or carry obligations for the purpose of section 265 of the Internal Revenue Code of 1986.
(2) GUARANTEE OF DEBT.—The Secretary is authorized, prior to October 1, 1984, to guarantee payment when due of principal and interest on obligations issued by the Association September 8, 2023 As Amended Through P.L.

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439 in an aggregate amount determined by the Secretary in con- sultation with the Secretary of the Treasury.

Nothing in this section shall be construed so as to authorize the Secretary of Education or the Secretary of the Treasury to limit, control, or constrain programs of the Association or support of the Guar- anteed Student Loan Program by the Association.
(3) BORROWING AUTHORITY TO MEET GUARANTEE OBLIGA- TIONS.—To enable the Secretary to discharge his responsibil- ities under guarantees issued by him, he is authorized to issue to the Secretary of the Treasury notes or other obligations in such forms and denominations, bearing such maturities, and subject to such terms and conditions, as may be prescribed by the Secretary with the approval of the Secretary of the Treas- ury.
Such notes or other obligations shall bear interest at a rate determined by the Secretary of the Treasury, taking into consideration the current average market yield on outstanding marketable obligations of the United States of comparable ma- turities during the months preceding the issuance of the notes or other obligations.
The Secretary of the Treasury is author- ized and directed to purchase any notes and other obligations issued hereunder and for that purpose he is authorized to use as a public debt transaction the proceeds from the sale of any securities issued under the Second Liberty Bond Act, as amended, and the purposes for which securities may be issued under that Act, as amended, are extended to include any pur- chase of such notes and obligations.
The Secretary of the Treasury may at any time sell any of the notes or other obliga- tions acquired by him under this subsection.

All redemptions, purchases, and sales by the Secretary of the Treasury of such notes or other obligations shall be treated as public debt trans- actions of the United States.

There is authorized to be appro- priated to the Secretary such sums as may be necessary to pay the principal and interest on the notes or obligations issued by him to the Secretary of the Treasury.
(4) ACTION ON REQUEST FOR GUARANTEES.—Upon receipt of a request from the Association under this subsection requiring approvals by the Secretary of Education or the Secretary of the Treasury, the Secretary of Education or the Secretary of the Treasury shall act promptly either to grant approval or to ad- vise the Association of the reasons for withholding approval.
In no case shall such an approval be withheld for a period longer than 60 days unless, prior to the end of such period, the Sec- retary of Education and the Secretary of the Treasury submit to the Congress a detailed explanation of reasons for doing so.
(5) AUTHORITY OF TREASURY TO PURCHASE DEBT.—The Sec- retary of the Treasury is authorized to purchase any obliga- tions issued by the Association pursuant to this subsection as now or hereafter in force, and for such purpose the Secretary of the Treasury is authorized to use as a public debt trans- action the proceeds of the sale of any securities hereafter issued under the Second Liberty Bond Act, as now or hereafter in force, and the purposes for which securities may be issued under the Second Liberty Bond Act, as now or hereafter in force are extended to include such purchases.
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439 HIGHER EDUCATION ACT OF 1965 442 the Treasury shall not at any time purchase any obligations under this subsection if such purchase would increase the ag- gregate principal amount of his then outstanding holdings of such obligations under this subsection to an amount greater than $1,000,000,000.
Each purchase of obligations by the Sec- retary of the Treasury under this subsection shall be upon such terms and conditions as to yield a return at a rate deter- mined by the Secretary of the Treasury, taking into consider- ation the current average rate on outstanding marketable obli- gations of the United States of comparable maturities as of the last day of the month preceding the making of such purchase.
The Secretary of the Treasury may, at any time, sell, upon such terms and conditions and at such price or prices as he shall determine, any of the obligations acquired by him under this subsection.

All redemptions, purchases, and sales by the Secretary of the Treasury of such obligations under this sub- section shall be treated as public debt transactions of the United States.
(6) SALE OF DEBT TO FEDERAL FINANCING BANK.—Notwith- standing any other provision of law the Association is author- ized to sell or issue obligations on the security of student loans, the payment of interest or principal of which has at any time been guaranteed under section 428 or 429 of this part, to the Federal Financing Bank.
(7) OFFSET FEE.—(A) The Association shall pay to the Sec- retary, on a monthly basis, an offset fee calculated on an an- nual basis in an amount equal to 0.30 percent of the principal amount of each loan made, insured or guaranteed under this part that the Association holds (except for loans made pursu- ant to sections 428C, 439(o), or 439(q)) and that was acquired on or after the date of enactment of this paragraph.
(B) If the Secretary determines that the Association has substantially failed to comply with subsection (q), subpara- graph (A) shall be applied by substituting ‘‘1.0 percent’’ for ‘‘0.3 percent’’.

(C) The Secretary shall deposit all fees collected pursuant to this paragraph into the insurance fund established in sec- tion 431.
(i) GENERAL CORPORATE POWERS.—The Association shall have power— (1) to sue and be sued, complain and defend, in its cor- porate name and through its own counsel; (2) to adopt, alter, and use the corporate seal, which shall be judicially noticed; (3) to adopt, amend, and repeal by its Board of Directors, bylaws, rules, and regulations as may be necessary for the con- duct of its business; (4) to conduct its business, carry on its operations, and have officers and exercise the power granted by this section in any State without regard to any qualification or similar statute in any State; (5) to lease, purchase, or otherwise acquire, own, hold, im- prove, use, or otherwise deal in and with any property, real, personal, or mixed, or any interest therein, wherever situated; September 8, 2023 As Amended Through P.L.
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439 (6) to accept gifts or donations of services, or of property, real, personal, or mixed, tangible or intangible, in aid of any of the purposes of the Association; (7) to sell, convey, mortgage, pledge, lease, exchange, and otherwise dispose of its property and assets; (8) to appoint such officers, attorneys, employees, and agents as may be required, to determine their qualifications, to define their duties, to fix their salaries, require bonds for them, and fix the penalty thereof; and (9) to enter into contracts, to execute instruments, to incur liabilities, and to do all things as are necessary or incidental to the proper management of its affairs and the proper conduct of its business.
(j) ACCOUNTING, AUDITING, AND REPORTING.—The accounts of the Association shall be audited annually.
Such audits shall be con- ducted in accordance with generally accepted auditing standards by independent certified public accountants or by independent licensed public accountants, licensed on or before December 31, 1970, who are certified or licensed by a regulatory authority of a State or other political subdivision of the United States, except that inde- pendent public accountants licensed to practice by such regulatory authority after December 31, 1970, and persons who, although not so certified or licensed, meet, in the opinion of the Secretary, stand- ards of education and experience representative of the highest standards prescribed by the licensing authorities of the several States which provide for the continuing licensing of public account- ants and which are prescribed by the Secretary in appropriate reg- ulations may perform such audits until December 31, 1975.
A re- port of each such audit shall be furnished to the Secretary of the Treasury.

The audit shall be conducted at the place or places where the accounts are normally kept.
The representatives of the Sec- retary shall have access to all books, accounts, financial records, re- ports, files, and all other papers, things, or property belonging to or in use by the Association and necessary to facilitate the audit, and they shall be afforded full facilities for verifying transactions with the balances or securities held by depositaries, fiscal agents, and custodians.
(k) REPORT ON AUDITS BY TREASURY.—A report of each such audit for a fiscal year shall be made by the Secretary of the Treas- ury to the President and to the Congress not later than 6 months following the close of such fiscal year.
The report shall set forth the scope of the audit and shall include a statement (showing intercor- porate relations) of assets and liabilities, capital and surplus or def- icit; a statement of surplus or deficit analysis; a statement of in- come and expense; a statement of sources and application of funds; and such comments and information as may be deemed necessary to keep the President and the Congress informed of the operations and financial condition of the Association, together with such rec- ommendations with respect thereto as the Secretary may deem ad- visable, including a report of any impairment of capital or lack of sufficient capital noted in the audit.
A copy of each report shall be furnished to the Secretary, and to the Association.

(l) LAWFUL INVESTMENT INSTRUMENTS; EFFECT OF AND EXEMP- TIONS FROM OTHER LAWS.—All obligations issued by the Associa- September 8, 2023 As Amended Through P.L.

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439 HIGHER EDUCATION ACT OF 1965 444 tion including those made under subsection (d)(4) shall be lawful investments, and may be accepted as security for all fiduciary, trust, and public funds, the investment or deposit of which shall be under authority or control of the United States or of any officer or officers thereof.
All stock and obligations issued by the Association pursuant to this section shall be deemed to be exempt securities within the meaning of laws administered by the Securities and Ex- change Commission, to the same extent as securities which are di- rect obligations of, or obligations guaranteed as to principal or in- terest by, the United States.

The Association shall, for the purposes of section 14(b)(2) of the Federal Reserve Act, be deemed to be an agency of the United States.
The obligations of the Association shall be deemed to be obligations of the United States for the pur- pose of section 3124 of title 31, United States Code.

For the pur- pose of the distribution of its property pursuant to section 726 of title 11, United States Code, the Association shall be deemed a per- son within the meaning of such title.
The priority established in favor of the United States by section 3713 of title 31, United States Code, shall not establish a priority over the indebtedness of the As- sociation issued or incurred on or before September 30, 1992.

The Federal Reserve Banks are authorized to act as depositaries, custodians, or fiscal agents, or a combination thereof, for the Asso- ciation in the general performance of its powers under this section.
(m) PREPARATION OF OBLIGATIONS.—In order to furnish obliga- tions for delivery by the Association, the Secretary of the Treasury is authorized to prepare such obligations in such form as the Board of Directors may approve, such obligations when prepared to be held in the Treasury subject to delivery upon order by the Associa- tion.

The engraved plates, dies, bed pieces, and so forth, executed in connection therewith shall remain in the custody of the Sec- retary of the Treasury.
The Association shall reimburse the Sec- retary of the Treasury for any expenditures made in the prepara- tion, custody, and delivery of such obligations.

The Secretary of the Treasury is authorized to promulgate regulations on behalf of the Association so that the Association may utilize the book-entry sys- tem of the Federal Reserve Banks.
(n) REPORT ON OPERATIONS AND ACTIVITIES.—The Association shall, as soon as practicable after the end of each fiscal year, trans- mit to the President and the Congress a report of the Association’s operations and activities, including a report with respect to all fa- cilities transactions, during each year.

(o) LOAN CONSOLIDATIONS.— (1) IN GENERAL.—The Association or its designated agent may, upon request of a borrower, consolidate loans received under this title in accordance with section 428C.
(2) USE OF EXISTING AGENCIES AS AGENT.—The Association in making loans pursuant to this subsection in any State served by a guaranty agency or an eligible lender in a State described in section 435(d)(1) (D) or (F) may designate as its agent such agency or lender to perform such functions as the Association determines appropriate.

Any agreements made pursuant to this subparagraph shall be on such terms and con- ditions as agreed upon by the Association and such agency or lender.
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439 (p) ADVANCES FOR DIRECT LOANS BY GUARANTY AGENCIES.— (1) IN GENERAL.—The Association shall make advances in each fiscal year from amounts available to it to each guaranty agency and eligible lender described in subsection 428(h)(1) which has an agreement with the Association which sets forth that advances are necessary to enable such agency or lender to make student loans in accordance with section 428(h) and that such advances will be repaid to the Association in accordance with such terms and conditions as may be set forth in the agreement and agreed to by the Association and such agency or lender.
Advances made under this subsection shall not be subject to subsection (d)(2) of this section.

(2) LIMITATION.—No advance may be made under this sub- section unless the guaranty agency or lender makes an applica- tion to the Association, which shall be accompanied by such in- formation as the Association determines to be reasonably nec- essary.
(q) LENDER-OF-LAST-RESORT.— (1) ACTION AT REQUEST OF SECRETARY.—(A) Whenever the Secretary determines that eligible borrowers are seeking and are unable to obtain loans under this part, the Association or its designated agent shall, not later than 90 days after the date of enactment of the Student Loan Reform Act of 1993, begin making loans to such eligible borrowers in accordance with this subsection at the request of the Secretary.
The Secretary may request that the Association make loans to borrowers within a geographic area or for the benefit of students attending institu- tions of higher education that certify, in accordance with stand- ards established by the Secretary, that their students are seek- ing and unable to obtain loans.
(B) Loans made pursuant to this subsection shall be insur- able by the Secretary under section 429 with a certificate of comprehensive insurance coverage provided for under section 429(b)(1) or by a guaranty agency under paragraph (2)(A) of this subsection.
(2) ISSUANCE AND COVERAGE OF LOANS.—(A) Whenever the Secretary, after consultation with, and with the agreement of, representatives of the guaranty agency in a State, or an eligi- ble lender in a State described in section 435(d)(1)(D), deter- mines that a substantial portion of eligible borrowers in such State or within an area of such State are seeking and are un- able to obtain loans under this part, the Association or its des- ignated agent shall begin making such loans to borrowers in such State or within an area of such State in accordance with this subsection at the request of the Secretary.
(B) Loans made pursuant to this subsection shall be insur- able by the agency identified in subparagraph (A) having an agreement pursuant to section 428(b).
For loans insured by such agency, the agency shall provide the Association with a certificate of comprehensive insurance coverage, if the Associa- tion and the agency have mutually agreed upon a means to de- termine that the agency has not already guaranteed a loan under this part to a student which would cause a subsequent September 8, 2023 As Amended Through P.L.
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439 HIGHER EDUCATION ACT OF 1965 446 loan made by the Association to be in violation of any provision under this part.
(3) TERMINATION OF LENDING.—The Association or its des- ignated agent shall cease making loans under this subsection at such time as the Secretary determines that the conditions which caused the implementation of this subsection have ceased to exist.
(r) SAFETY AND SOUNDNESS OF ASSOCIATION.— (1) REPORTS BY THE ASSOCIATION.—The Association shall promptly furnish to the Secretary of Education and Secretary of the Treasury copies of all— (A) periodic financial reports publicly distributed by the Association; (B) reports concerning the Association that are re- ceived by the Association and prepared by nationally rec- ognized statistical rating organizations; and (C)(i) financial statements of the Association within 45 days of the end of each fiscal quarter; and (ii) reports setting forth the calculation of the capital ratio of the Association within 45 days of the end of each fiscal quarter.
(2) AUDIT BY SECRETARY OF THE TREASURY.—(A) The Sec- retary of the Treasury may— (i) appoint and fix the compensation of such auditors and examiners as may be necessary 45 to conduct audits of the Association from time to time to determine the condi- tion of the Association for the purpose of assessing the As- sociation’s financial safety and soundness and to determine whether the requirements of this section and section 440 are being met; and (ii) obtain the services of such experts as the Secretary of the Treasury determines necessary and appropriate, as authorized by section 3109 of title 5, United States Code, to assist in determining the condition of the Association for the purpose of assessing the Association’s financial safety and soundness, and to determine whether the require- ments of this section and section 440 are being met.
(B) Each auditor appointed under this paragraph shall conduct an audit of the Association to the extent requested by the Secretary of the Treasury and shall prepare and submit a report to the Secretary of the Treasury concerning the results of such audit.

A copy of such report shall be furnished to the Association and the Secretary of Education on the date on which it is delivered to the Secretary of the Treasury.
(C) The Association shall provide full and prompt access to the Secretary of the Treasury to its books and records and other information requested by the Secretary of the Treasury.

(D) ANNUAL ASSESSMENT.— 45 Section 309(1) of the Departments of Labor, Health and Human Services, and Education, and Related Agencies Appropriations Act, 2001 (114 Stat.
2763A–45), as enacted into law by section 1(a)(1) of Public Law 106–554, amended this clause by striking ‘‘auditors and examiners’’ and inserting ‘‘and fix the compensation of such auditors and examiners as may be necessary’’.

The amendment probably should have been to strike ‘‘auditors or examiners’’, but was executed to reflect the probable intent of Congress.

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439 (i) IN GENERAL.—For each fiscal year beginning on or after October 1, 1996, the Secretary of the Treasury may establish and collect from the Association an assessment (or assessments) in amounts sufficient to provide for rea- sonable costs and expenses of carrying out the duties of the Secretary of the Treasury under this section and sec- tion 440 during such fiscal year.
In no event may the total amount so assessed exceed, for any fiscal year, $800,000, adjusted for each fiscal year ending after September 30, 1997, by the ratio of the Consumer Price Index for All Urban Consumers (issued by the Bureau of Labor Statis- tics) for the final month of the fiscal year preceding the fis- cal year for which the assessment is made to the Con- sumer Price Index for All Urban Consumers for September 1997.
(ii) DEPOSIT.—Amounts collected from assessments under this subparagraph shall be deposited in an account within the Treasury of the United States as designated by the Secretary of the Treasury for that purpose.

The Sec- retary of the Treasury is authorized and directed to pay out of any funds available in such account the reasonable costs and expenses of carrying out the duties of the Sec- retary of the Treasury under this section and section 440.
None of the funds deposited into such account shall be available for any purpose other than making payments for such costs and expenses.
(E) OBLIGATION TO OBTAIN, MAINTAIN, AND REPORT INFOR- MATION.— (i) IN GENERAL.—The Association shall obtain such in- formation and make and keep such records as the Sec- retary of the Treasury may from time to time prescribe concerning— (I) the financial risk to the Association resulting from the activities of any associated person, to the ex- tent such activities are reasonably likely to have a ma- terial impact on the financial condition of the Associa- tion, including the Association’s capital ratio, the Asso- ciation’s liquidity, or the Association’s ability to con- duct and finance the Association’s operations; and (II) the Association’s policies, procedures, and sys- tems for monitoring and controlling any such financial risk.
(ii) SUMMARY REPORTS.—The Secretary of the Treasury may require summary reports of such information to be filed no more frequently than quarterly.
If, as a result of adverse market conditions or based on reports provided pursuant to this subparagraph or other available informa- tion, the Secretary of the Treasury has concerns regarding the financial or operational condition of the Association, the Secretary of the Treasury may, notwithstanding the preceding sentence and clause (i), require the Association to make reports concerning the activities of any associated person, whose business activities are reasonably likely to September 8, 2023 As Amended Through P.L.
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439 HIGHER EDUCATION ACT OF 1965 448 have a material impact on the financial or operational con- dition of the Association.
(iii) DEFINITION.—For purposes of this subparagraph, the term ‘‘associated person’’ means any person, other than a natural person, directly or indirectly controlling, con- trolled by, or under common control with the Association.
(F) 46 COMPENSATION OF AUDITORS AND EXAMINERS.— (i) RATES OF PAY.—Rates of basic pay for all audi- tors and examiners appointed pursuant to subpara- graph (A) may be set and adjusted by the Secretary of the Treasury without regard to the provisions of chap- ter 51 or subchapter III of chapter 53 of title 5, United States Code.
(ii) COMPARABILITY.— (I) IN GENERAL.—Subject to section 5373 of title 5, United States Code, the Secretary of the Treasury may provide additional compensation and benefits to auditors and examiners appointed pursuant to subparagraph (A) if the same type of compensation or benefits are then being provided by any agency referred to in section 1206 of the Financial Institutions Reform, Recovery, and En- forcement Act of 1989 (12 U.S.C.
1833b) or, if not then being provided, could be provided by such an agency under applicable provisions of law, rule, or regulation.

(II) CONSULTATION.—In setting and adjusting the total amount of compensation and benefits for auditors and examiners appointed pursuant to subparagraph (A), the Secretary of the Treasury shall consult with, and seek to maintain com- parability with, the agencies referred to in section 1206 of the Financial Institutions Reform, Recov- ery, and Enforcement Act of 1989 (12 U.S.C.
1833b).

(3) MONITORING OF SAFETY AND SOUNDNESS.—The Sec- retary of the Treasury shall conduct such studies as may be necessary to monitor the financial safety and soundness of the Association.
In the event that the Secretary of the Treasury de- termines that the financial safety and soundness of the Asso- ciation is at risk, the Secretary of the Treasury shall inform the Chairman and ranking minority member of the Committee on Labor and Human Resources of the Senate, the Chairman and ranking minority member of the Committee on Education and Labor of the House of Representatives, and the Secretary of Education of such determination and identify any corrective actions that should be taken to ensure the safety and sound- ness of the Association.
(4) CAPITAL STANDARD.—If the capital ratio is less than 2 percent and is greater than or equal to 1.75 percent at the end of the Association’s most recent calendar quarter the Associa- tion shall, within 60 days of such occurrence, submit to the September 8, 2023 As Amended Through P.L.

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439 Secretary of the Treasury a capital restoration plan, in reason- able detail, that the Association believes is adequate to cause the capital ratio to equal or exceed 2 percent within 36 months.
(5) CAPITAL RESTORATION PLAN.— (A) SUBMISSION, APPROVAL, AND IMPLEMENTATION.— The Secretary of the Treasury and the Association shall consult with respect to any capital restoration plan sub- mitted pursuant to paragraph (4) and the Secretary of the Treasury shall approve such plan (or a modification there- of accepted by the Association) or disapprove such plan within 30 days after such plan is first submitted to the Secretary of the Treasury by the Association, unless the Association and Secretary of the Treasury mutually agree to a longer consideration period.
If the Secretary of the Treasury approves a capital restoration plan (including a modification of a plan accepted by the Association), the As- sociation shall forthwith proceed with diligence to imple- ment such plan to the best of its ability.
(B) DISAPPROVAL.—If the Secretary of the Treasury does not approve a capital restoration plan as provided in subparagraph (A), then not later than the earlier of the date the Secretary of the Treasury disapproves of such plan by written notice to the Association or the expiration of the 30-day consideration period referred to in subpara- graph (A) (as such period may have been extended by mu- tual agreement), the Secretary of the Treasury shall sub- mit the Association’s capital restoration plan, in the form most recently proposed to the Secretary of the Treasury by the Association, together with a report on the Secretary of the Treasury’s reasons for disapproval of such plan and an alternative capital restoration plan, to the Chairman and ranking minority member of the Senate Committee on Labor and Human Resources and to the Chairman and ranking minority member of the House Committee on Edu- cation and Labor.
A copy of such submission simulta- neously shall be sent to the Association and the Secretary of Education by the Secretary of the Treasury.

(C) ASSOCIATION IMPLEMENTATION AND RESPONSE.— Upon receipt of the submission by the Association, the As- sociation shall forthwith proceed with diligence to imple- ment the most recently proposed capital restoration plan of the Association.
The Association, within 30 days after re- ceipt from the Secretary of the Treasury of such submis- sion, shall submit to such Chairmen and ranking minority members a written response to such submission, setting out fully the nature and extent of the Association’s agree- ment or the disagreement with the Secretary of the Treas- ury with respect to the capital restoration plan submitted to the Secretary of the Treasury and any findings of the Secretary of the Treasury.
(6) SUBSTANTIAL CAPITAL RATIO REDUCTION.— (A) ADDITIONAL PLAN REQUIRED.—If the capital ratio is less than 1.75 percent and is greater than or equal to 1 percent at the end of the Association’s most recent cal- September 8, 2023 As Amended Through P.L.

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439 HIGHER EDUCATION ACT OF 1965 450 endar quarter, the Association shall submit to the Sec- retary of the Treasury within 60 days after such occur- rence a capital restoration plan (or an appropriate modi- fication of any plan previously submitted or approved under paragraph (4)) to increase promptly its capital ratio to equal or exceed 1.75 percent.

The Secretary of the Treasury and the Association shall consult with respect to any plan or modified plan submitted pursuant to this paragraph.
The Secretary of the Treasury shall approve such plan or modified plan (or a modification thereof ac- cepted by the Association) or disapprove such plan or modified plan within 30 days after such plan or modified plan is first submitted to the Secretary of the Treasury by the Association, unless the Association and Secretary of the Treasury mutually agree to a longer consideration pe- riod.
If the Secretary of the Treasury approves a plan or modified plan (including a modification of a plan accepted by the Association), the Association shall forthwith proceed with diligence to implement such plan or modified plan to the best of the Association’s ability.
(B) DISAPPROVAL.—If the Secretary of the Treasury disapproves a capital restoration plan or modified plan submitted pursuant to subparagraph (A), then, not later than the earlier of the date the Secretary of the Treasury disapproves of such plan or modified plan (by written no- tice to the Association) or the expiration of the 30-day con- sideration period described in subparagraph (A) (as such period may have been extended by mutual agreement), the Secretary of the Treasury shall prepare and submit an al- ternative capital restoration plan, together with a report on his reasons for disapproval of the Association’s plan or modified plan, to the Chairman and ranking minority member of the Committee on Labor and Human Resources of the Senate and to the Chairman and ranking minority member of the Committee on Education and Labor of the House of Representatives.
A copy of such submission si- multaneously shall be sent to the Association and the Sec- retary of Education by the Secretary of the Treasury.
The Association, within 5 days after receipt from the Secretary of the Treasury of such submission, shall submit to the Chairmen and ranking minority members of such Commit- tees, and the Secretary of the Treasury, a written response to such submission, setting out fully the nature and extent of the Association’s agreement or disagreement with the Secretary of the Treasury with respect to the disapproved plan and the alternative plan of the Secretary of the Treasury and any findings of the Secretary of the Treas- ury.
(C) REVIEW BY CONGRESS; ASSOCIATION IMPLEMENTA- TION.—Congress shall have 60 legislative days after the date on which Congress receives the alternative plan under subparagraph (B) from the Secretary of the Treas- ury to review such plan.

If Congress does not take statu- tory action with respect to any such plan within such 60- September 8, 2023 As Amended Through P.L.
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439 day period, the Association shall immediately proceed with diligence to implement the alternative capital restoration plan of the Secretary of the Treasury under subparagraph (B).
If Congress is out of session when any such alter- native plan is received, such 60-day period shall begin on the first day of the next session of Congress.
(7) ACTIONS BY SECRETARY OF THE TREASURY.—If the cap- ital ratio of the Association does not equal or exceed 1.75 per- cent at the end of the Association’s most recent calendar quar- ter, the Secretary of the Treasury may, until the capital ratio equals or exceeds 1.75 percent, take any one or more of the fol- lowing actions: (A) LIMIT INCREASE IN LIABILITIES.—Limit any in- crease in, or order the reduction of, any liabilities of the Association, except as necessary to fund student loan pur- chases and warehousing advances.
(B) RESTRICT GROWTH.—Restrict or eliminate growth of the Association’s assets, other than student loans pur- chases and warehousing advances.

(C) RESTRICT DISTRIBUTIONS.—Restrict the Association from making any capital distribution.

(D) REQUIRE ISSUANCE OF NEW CAPITAL.—Require the Association to issue new capital in any form and in any amount sufficient to restore at least a 1.75 percent capital ratio.
(E) LIMIT EXECUTIVE COMPENSATION.—Prohibit the As- sociation from increasing for any executive officer any com- pensation including bonuses at a rate exceeding that offi- cer’s average rate of compensation during the previous 12 calendar months and prohibiting the Board from adopting any new employment severance contracts.
(8) CRITICAL CAPITAL STANDARD.—(A) If the capital ratio is less than 1 percent at the end of the Association’s most recent calendar quarter and the Association has already submitted a capital restoration plan to the Secretary of the Treasury pursu- ant to paragraph (4) or (6)(A), the Association shall forthwith proceed with diligence to implement the most recently pro- posed plan with such modifications as the Secretary of the Treasury determines are necessary to cause the capital ratio to equal or exceed 2 percent within 60 months.
(B) If the capital ratio is less than 1 percent at the end of the Association’s most recent calendar quarter and the Associa- tion has not submitted a capital restoration plan to the Sec- retary of the Treasury pursuant to paragraph (4) or (6)(A), the Association shall— (i) within 14 days of such occurrence submit a capital restoration plan to the Secretary of the Treasury which the Association believes is adequate to cause the capital ratio to equal or exceed 2 percent within 60 months; and (ii) forthwith proceed with diligence to implement such plan with such modifications as the Secretary of the Treas- ury determines are necessary to cause the capital ratio to equal or exceed 2 percent within 60 months.
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439 HIGHER EDUCATION ACT OF 1965 452 (C) Immediately upon a determination under subpara- graph (A) or (B) to implement a capital restoration plan, the Secretary of the Treasury shall submit the capital restoration plan to be implemented to the Chairman and ranking minority member of the Committee on Labor and Human Resources of the Senate, the Chairman and ranking minority member of the Committee on Education and Labor of the House of Represent- atives, and the Secretary of Education.
(9) ADDITIONAL REPORTS TO COMMITTEES.—The Association shall submit a copy of its capital restoration plan, modifica- tions proposed to the Secretary of the Treasury, and proposed modifications received from the Secretary of the Treasury to the Congressional Budget Office and General Accounting Office upon their submission to the Secretary of the Treasury or re- ceipt from the Secretary of the Treasury.
Notwithstanding any other provision of law, the Congressional Budget Office and General Accounting Office shall maintain the confidentiality of information received pursuant to the previous sentence.
In the event that the Secretary of the Treasury does not approve a capital restoration plan as provided in paragraph (5)(A) or (6)(A), or in the event that a capital restoration plan is modi- fied by the Secretary of the Treasury pursuant to paragraph (6)(B) or (8), the Congressional Budget Office and General Ac- counting Office shall each submit a report within 30 days of the Secretary of the Treasury’s submission to the Chairmen and ranking minority members as required in paragraphs (5)(B), (6)(B), and (8)(C) to such Chairmen and ranking mem- bers— (A) analyzing the financial condition of the Associa- tion; (B) analyzing the capital restoration plan and reasons for disapproval of the plan contained in the Secretary of the Treasury’s submission made pursuant to paragraph (5)(B), or the capital restoration plan proposed by the As- sociation and the modifications made by the Secretary of the Treasury pursuant to paragraph (6)(B) or (8); (C) analyzing the impact of the capital restoration plan and reasons for disapproval of the plan contained in the Secretary of the Treasury’s submission made pursuant to paragraph (5)(B), or the impact of the capital restoration plan proposed by the Association and the modifications made by the Secretary of the Treasury pursuant to para- graph (6)(B) or (8), and analyzing the impact of the rec- ommendations made pursuant to subparagraph (D) of this paragraph, on— (i) the ability of the Association to fulfill its pur- pose and authorized activities as provided in this sec- tion, and (ii) the operation of the student loan programs; and (D) recommending steps which the Association should take to increase its capital ratio without impairing its abil- ity to perform its purpose and authorized activities as pro- vided in this section.
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439 (10) REVIEW BY SECRETARY OF EDUCATION.—The Secretary of Education shall review the Secretary of the Treasury’s sub- mission required pursuant to paragraph (5)(B), (6)(B), or (8) and shall submit a report within 30 days to the Chairman and ranking minority member of the Senate Committee on Labor and Human Resources and to the Chairman and ranking mi- nority member of the House Committee on Education and Labor— (B) recommending administrative and (A) describing any administrative or legislative provi- sions governing the student loan programs which contrib- uted to the decline in the Association’s capital ratio; and legislative changes in the student loan programs to maintain the or- derly operation of such programs and to enable the Asso- ciation to fulfill its purpose and authorized activities con- sistent with the capital ratio specified in paragraph (4).
(11) SAFE HARBOR.—The Association shall be deemed in compliance with the capital ratios described in paragraphs (4) and (6)(A) if the Association is rated in 1 of the 2 highest full rating categories (such categories to be determined without re- gard to designations within categories) by 2 nationally recog- nized statistical rating organizations, determined without re- gard to the Association’s status as a federally chartered cor- poration.
(12) TREATMENT OF CONFIDENTIAL INFORMATION.—Not- withstanding any other provision of law, the Secretary of the Treasury, the Secretary of Education, the Congressional Budg- et Office, and the General Accounting Office shall not disclose any information treated as confidential by the Association or the Association’s associated persons and obtained pursuant to this subsection.
Nothing in this paragraph shall authorize the Secretary of the Treasury, the Secretary of Education, the Con- gressional Budget Office, and the General Accounting Office to withhold information from Congress, or prevent the Secretary of Education, the Congressional Budget Office, and the General Accounting Office from complying with a request for informa- tion from any other Federal department or agency requesting the information for purposes within the scope of its jurisdic- tion, or complying with an order of a court of the United States in an action brought by the United States.
For purposes of sec- tion 552 of title 5, United States Code, this paragraph shall be considered a statute described in subsection (b)(3) of such sec- tion 552.
(13) ENFORCEMENT OF SAFETY AND SOUNDNESS REQUIRE- MENTS.—The Secretary of Education or the Secretary of the Treasury, as appropriate, may request that the Attorney Gen- eral bring an action in the United States District Court for the District of Columbia for the enforcement of any provision of this section, or may, under the direction or control of the Attor- ney General, bring such an action.

Such court shall have juris- diction and power to order and require compliance with this section.
(14) ACTIONS BY SECRETARY.— September 8, 2023 As Amended Through P.L.

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439 HIGHER EDUCATION ACT OF 1965 454 (A) IN GENERAL.—For any fiscal quarter ending after January 1, 2000, the Association shall have a capital ratio of at least 2.25 percent.
The Secretary of the Treasury may, whenever such capital ratio is not met, take any one or more of the actions described in paragraph (7), except that— (i) the capital ratio to be restored pursuant to paragraph (7)(D) shall be 2.25 percent; and (ii) if the relevant capital ratio is in excess of or equal to 2 percent for such quarter, the Secretary of the Treasury shall defer taking any of the actions set forth in paragraph (7) until the next succeeding quar- ter and may then proceed with any such action only if the capital ratio of the Association remains below 2.25 percent.
(B) APPLICABILITY.—The provisions of paragraphs (4), (5), (6), (8), (9), (10), and (11) shall be of no further applica- tion to the Association for any period after January 1, 2000.

(15) DEFINITIONS.—As used in this subsection: (A) The term ‘‘nationally recognized statistical rating organization’’ means any nationally recognized statistical rating organization, as that term is defined in section 3(a) of the Securities Exchange Act of 1934.
(B) The term ‘‘capital ratio’’ means the ratio of total stockholders’ equity, as shown on the Association’s most recent quarterly consolidated balance sheet prepared in the ordinary course of its business, to the sum of— (i) the total assets of the Association, as shown on the balance sheet prepared in the ordinary course of its business; and (ii) 50 percent of the credit equivalent amount of the following off-balance sheet items of the Association as of the date of such balance sheet— (I) all financial standby letters of credit and other irrevocable guarantees of the repayment of financial obligations of others; and (II) all interest rate contracts and exchange rate contracts, including interest exchange agree- ments, floor, cap, and collar agreements and simi- lar arrangements.
For purposes of this subparagraph, the calculation of the credit equivalent amount of the items set forth in clause (ii) of this subparagraph, the netting of such items and eliminations for the purpose of avoidance of double-count- ing of such items shall be made in accordance with the measures for computing credit conversion factors for off- balance sheet items for capital maintenance purposes es- tablished for commercial banks from time to time by the Federal Reserve Board, but without regard to any risk weighting provisions in such measures.
(C) The term ‘‘legislative days’’ means only days on which either House of Congress is in session.

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439 (16) DIVIDENDS.—The Association may pay dividends in the form of cash or noncash distributions so long as at the time of the declaration of such dividends, after giving effect to the payment of such dividends as of the date of such declaration by the Board of Directors of the Association, the Association’s capital would be in compliance with the capital standards set forth in this section.
(17) CERTIFICATION PRIOR TO PAYMENT OF DIVIDEND.—Prior to the payment of any dividend under paragraph (16), the As- sociation shall certify to the Secretary of the Treasury that the payment of the dividend will be made in compliance with para- graph (16) and shall provide copies of all calculations needed to make such certification.
(s) CHARTER SUNSET.— (1) APPLICATION OF PROVISIONS.—This subsection applies beginning 18 months and one day after the date of enactment of this subsection if no reorganization of the Association occurs in accordance with the provisions of section 440.
(2) SUNSET PLAN.— (A) PLAN SUBMISSION BY THE ASSOCIATION.—Not later than July 1, 2007, the Association shall submit to the Sec- retary of the Treasury and to the Chairman and Ranking Member of the Committee on Labor and Human Resources of the Senate and the Chairman and Ranking Member of the Committee on Economic and Educational Opportuni- ties of the House of Representatives, a detailed plan for the orderly winding up, by July 1, 2013, of business activi- ties conducted pursuant to the charter set forth in this sec- tion.
Such plan shall— (i) ensure that the Association will have adequate assets to transfer to a trust, as provided in this sub- section, to ensure full payment of remaining obliga- tions of the Association in accordance with the terms of such obligations; (ii) provide that all assets not used to pay liabil- ities shall be distributed to shareholders as provided in this subsection; and (iii) provide that the operations of the Association shall remain separate and distinct from that of any entity to which the assets of the Association are trans- ferred.
(B) AMENDMENT OF THE PLAN BY THE ASSOCIATION.— The Association shall from time to time amend such plan to reflect changed circumstances, and submit such amend- ments to the Secretary of the Treasury and to the Chair- man and Ranking Minority Member of the Committee on Labor and Human Resources of the Senate and Chairman and Ranking Minority Member of the Committee on Eco- nomic and Educational Opportunities of the House of Rep- resentatives.
In no case may any amendment extend the date for full implementation of the plan beyond the dis- solution date provided in paragraph (3).

(C) PLAN MONITORING.—The Secretary of the Treasury shall monitor the Association’s compliance with the plan September 8, 2023 As Amended Through P.L.

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439 HIGHER EDUCATION ACT OF 1965 456 and shall continue to review the plan (including any amendments thereto).

(D) AMENDMENT OF THE PLAN BY THE SECRETARY OF THE TREASURY.—The Secretary of the Treasury may re- quire the Association to amend the plan (including any amendments to the plan), if the Secretary of the Treasury deems such amendments necessary to ensure full payment of all obligations of the Association.
(E) IMPLEMENTATION BY THE ASSOCIATION.—The Asso- ciation shall promptly implement the plan (including any amendments to the plan, whether such amendments are made by the Association or are required to be made by the Secretary of the Treasury).

(3) DISSOLUTION OF THE ASSOCIATION.—The Association shall dissolve and the Association’s separate existence shall terminate on July 1, 2013, after discharge of all outstanding debt obligations and liquidation pursuant to this subsection.
The Association may dissolve pursuant to this subsection prior to such date by notifying the Secretary of Education and the Secretary of the Treasury of the Association’s intention to dis- solve, unless within 60 days of receipt of such notice the Sec- retary of Education notifies the Association that the Associa- tion continues to be needed to serve as a lender of last resort pursuant to subsection (q) or continues to be needed to pur- chase loans under an agreement with the Secretary described in paragraph (4)(A).
On the dissolution date, the Association shall take the following actions: (A) ESTABLISHMENT OF A TRUST.—The Association shall, under the terms of an irrevocable trust agreement in form and substance satisfactory to the Secretary of the Treasury, the Association, and the appointed trustee, ir- revocably transfer all remaining obligations of the Associa- tion to a trust and irrevocably deposit or cause to be depos- ited into such trust, to be held as trust funds solely for the benefit of holders of the remaining obligations, money or direct noncallable obligations of the United States or any agency thereof for which payment the full faith and credit of the United States is pledged, maturing as to principal and interest in such amounts and at such times as are de- termined by the Secretary of the Treasury to be sufficient, without consideration of any significant reinvestment of such interest, to pay the principal of, and interest on, the remaining obligations in accordance with their terms.
(B) USE OF TRUST ASSETS.—All money, obligations, or financial assets deposited into the trust pursuant to this subsection shall be applied by the trustee to the payment of the remaining obligations assumed by the trust.

Upon the fulfillment of the trustee’s duties under the trust, any remaining assets of the trust shall be transferred to the persons who, at the time of the dissolution, were the shareholders of the Association, or to the legal successors or assigns of such persons.
(C) OBLIGATIONS NOT TRANSFERRED TO THE TRUST.— The Association shall make proper provision for all other September 8, 2023 As Amended Through P.L.

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439 obligations of the Association, including the repurchase or redemption, or the making of proper provision for the re- purchase or redemption, of any preferred stock of the Asso- ciation outstanding.

(D) TRANSFER OF REMAINING ASSETS.—After compli- ance with subparagraphs (A) and (C), the Association shall transfer to the shareholders of the Association any remain- ing assets of the Association.
(4) RESTRICTIONS RELATING TO WINDING UP.— (A) RESTRICTIONS ON NEW BUSINESS ACTIVITY OR AC- QUISITION OF ASSETS BY THE ASSOCIATION.— (i) IN GENERAL.—Beginning on July 1, 2009, the Association shall not engage in any new business ac- tivities or acquire any additional program assets (in- cluding acquiring assets pursuant to contractual com- mitments) described in subsection (d) other than in connection with the Association— (I) serving as a lender of last resort pursuant to subsection (q); and (II) purchasing loans insured under this part, if the Secretary, with the approval of the Sec- retary of the Treasury, enters into an agreement with the Association for the continuation or re- sumption of the Association’s secondary market purchase program because the Secretary deter- mines there is inadequate liquidity for loans made under this part.
(ii) AGREEMENT.—The Secretary is authorized to enter into an agreement described in subclause (II) of clause (i) with the Association covering such secondary market activities.

Any agreement entered into under such subclause shall cover a period of 12 months, but may be renewed if the Secretary determines that li- quidity remains inadequate.

The fee provided under subsection (h)(7) shall not apply to loans acquired under any such agreement with the Secretary.
(B) ISSUANCE OF DEBT OBLIGATIONS DURING THE WIND UP PERIOD; ATTRIBUTES OF DEBT OBLIGATIONS.—The Asso- ciation shall not issue debt obligations which mature later than July 1, 2013, except in connection with serving as a lender of last resort pursuant to subsection (q) or with pur- chasing loans under an agreement with the Secretary as described in subparagraph (A).
Nothing in this subsection shall modify the attributes accorded the debt obligations of the Association by this section, regardless of whether such debt obligations are transferred to a trust in accordance with paragraph (3).

(C) USE OF ASSOCIATION NAME.—The Association may not transfer or permit the use of the name ‘‘Student Loan Marketing Association’’, ‘‘Sallie Mae’’, or any variation thereof, to or by any entity other than a subsidiary of the Association.

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440 HIGHER EDUCATION ACT OF 1965 458 SEC.

440.

47 REORGANIZATION OF THE STUDENT LOAN MARKETING AS- SOCIATION THROUGH THE FORMATION OF A HOLDING COMPANY.
(a) ACTIONS BY THE ASSOCIATION’S BOARD OF DIRECTORS.—The Board of Directors of the Association shall take or cause to be taken all such action as the Board of Directors deems necessary or appropriate to effect, upon the shareholder approval described in subsection (b), a restructuring of the common stock ownership of the Association, as set forth in a plan of reorganization adopted by the Board of Directors (the terms of which shall be consistent with this section) so that all of the outstanding common shares of the Association shall be directly owned by a Holding Company.
Such actions may include, in the Board of Director’s discretion, a merger of a wholly owned subsidiary of the Holding Company with and into the Association, which would have the effect provided in the plan of reorganization and the law of the jurisdiction in which such subsidiary is incorporated.
As part of the restructuring, the Board of Directors may cause— (1) the common shares of the Association to be converted, on the reorganization effective date, to common shares of the Holding Company on a one for one basis, consistent with appli- cable State or District of Columbia law; and (2) Holding Company common shares to be registered with the Securities and Exchange Commission.
(b) SHAREHOLDER APPROVAL.—The plan of reorganization adopted by the Board of Directors pursuant to subsection (a) shall be submitted to common shareholders of the Association for their approval.

The reorganization shall occur on the reorganization ef- fective date, provided that the plan of reorganization has been ap- proved by the affirmative votes, cast in person or by proxy, of the holders of a majority of the issued and outstanding shares of the Association common stock.
(c) TRANSITION.—In the event the shareholders of the Associa- tion approve the plan of reorganization under subsection (b), the following provisions shall apply beginning on the reorganization ef- fective date: (1) IN GENERAL.—Except as specifically provided in this section, until the dissolution date the Association shall con- tinue to have all of the rights, privileges and obligations set forth in, and shall be subject to all of the limitations and re- strictions of, section 439, and the Association shall continue to carry out the purposes of such section.
The Holding Company and any subsidiary of the Holding Company (other than the Association) shall not be entitled to any of the rights, privi- leges, and obligations, and shall not be subject to the limita- tions and restrictions, applicable to the Association under sec- tion 439, except as specifically provided in this section.
The Holding Company and any subsidiary of the Holding Company (other than the Association or a subsidiary of the Association) shall not purchase loans insured under this Act until such time as the Association ceases acquiring such loans, except that the Holding Company may purchase such loans if the Association September 8, 2023 As Amended Through P.L.

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440 is merely continuing to acquire loans as a lender of last resort pursuant to section 439(q) or under an agreement with the Secretary described in paragraph (6).
(2) TRANSFER OF CERTAIN PROPERTY.— (A) IN GENERAL.—Except as provided in this section, on the reorganization effective date or as soon as prac- ticable thereafter, the Association shall use the Associa- tion’s best efforts to transfer to the Holding Company or any subsidiary of the Holding Company (or both), as di- rected by the Holding Company, all real and personal property of the Association (both tangible and intangible) other than the remaining property.
Subject to the pre- ceding sentence, such transferred property shall include all right, title, and interest in— (i) direct or indirect subsidiaries of the Association (excluding special purpose funding companies in exist- ence on the date of enactment of this section and any interest in any government-sponsored enterprise); (ii) contracts, leases, and other agreements of the Association; (iii) licenses and other intellectual property of the Association; and (iv) any other property of the Association.
(B) CONSTRUCTION.—Nothing in this paragraph shall be construed to prohibit the Association from transferring remaining property from time to time to the Holding Com- pany or any subsidiary of the Holding Company, subject to the provisions of paragraph (4).
(3) TRANSFER OF PERSONNEL.—On the reorganization effec- tive date, employees of the Association shall become employees of the Holding Company (or any subsidiary of the Holding Company), and the Holding Company (or any subsidiary of the Holding Company) shall provide all necessary and appropriate management and operational support (including loan servicing) to the Association, as requested by the Association.
The Asso- ciation, however, may obtain such management and oper- ational support from persons or entities not associated with the Holding Company.
(4) DIVIDENDS.—The Association may pay dividends in the form of cash or noncash distributions so long as at the time of the declaration of such dividends, after giving effect to the pay- ment of such dividends as of the date of such declaration by the Board of Directors of the Association, the Association’s cap- ital would be in compliance with the capital standards and re- quirements set forth in section 439(r).
If, at any time after the reorganization effective date, the Association fails to comply with such capital standards, the Holding Company shall trans- fer with due diligence to the Association additional capital in such amounts as are necessary to ensure that the Association again complies with the capital standards.
(5) CERTIFICATION PRIOR TO DIVIDEND.—Prior to the pay- ment of any dividend under paragraph (4), the Association shall certify to the Secretary of the Treasury that the payment of the dividend will be made in compliance with paragraph (4) September 8, 2023 As Amended Through P.L.

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440 HIGHER EDUCATION ACT OF 1965 460 and shall provide copies of all calculations needed to make such certification.
(6) RESTRICTIONS ON NEW BUSINESS ACTIVITY OR ACQUISI- TION OF ASSETS BY ASSOCIATION.— (A) IN GENERAL.—After the reorganization effective date, the Association shall not engage in any new business activities or acquire any additional program assets de- scribed in section 439(d) other than in connection with— (i) student loan purchases through September 30, 2007; (ii) contractual future warehousing advances, or pursuant to letters of credit or standby bond purchase agreements, which are out- standing as of the reorganization effective date; commitments for (iii) the Association serving as a lender-of-last-re- sort pursuant to section 439(q); and (iv) the Association’s purchase of loans insured under this part, if the Secretary, with the approval of the Secretary of the Treasury, enters into an agree- ment with the Association for the continuation or re- sumption of the Association’s secondary market pur- chase program because the Secretary determines there is inadequate liquidity for loans made under this part.
(B) AGREEMENT.—The Secretary is authorized to enter into an agreement described in clause (iv) of subparagraph (A) with the Association covering such secondary market activities.

Any agreement entered into under such clause shall cover a period of 12 months, but may be renewed if the Secretary determines that liquidity remains inad- equate.

The fee provided under section 439(h)(7) shall not apply to loans acquired under any such agreement with the Secretary.
(7) ISSUANCE OF DEBT OBLIGATIONS DURING THE TRANSI- TION PERIOD; ATTRIBUTES OF DEBT OBLIGATIONS.—After the re- organization effective date, the Association shall not issue debt obligations which mature later than September 30, 2008, ex- cept in connection with serving as a lender-of-last-resort pursu- ant to section 439(q) or with purchasing loans under an agree- ment with the Secretary as described in paragraph (6).
Noth- ing in this section shall modify the attributes accorded the debt obligations of the Association by section 439, regardless of whether such debt obligations are incurred prior to, or at any time following, the reorganization effective date or are trans- ferred to a trust in accordance with subsection (d).
(8) MONITORING OF SAFETY AND SOUNDNESS.— (A) OBLIGATION TO OBTAIN, MAINTAIN, AND REPORT IN- FORMATION.—The Association shall obtain such informa- tion and make and keep such records as the Secretary of the Treasury may from time to time prescribe con- cerning— (i) the financial risk to the Association resulting from the activities of any associated person, to the ex- tent such activities are reasonably likely to have a ma- terial impact on the financial condition of the Associa- September 8, 2023 As Amended Through P.L.
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440 tion, including the Association’s capital ratio, the Asso- ciation’s liquidity, or the Association’s ability to con- duct and finance the Association’s operations; and (ii) the Association’s policies, procedures, and sys- tems for monitoring and controlling any such financial risk.

(B) SUMMARY REPORTS.—The Secretary of the Treas- ury may require summary reports of the information de- scribed in subparagraph (A) to be filed no more frequently than quarterly.
If, as a result of adverse market conditions or based on reports provided pursuant to this subpara- graph or other available information, the Secretary of the Treasury has concerns regarding the financial or oper- ational condition of the Association, the Secretary of the Treasury may, notwithstanding the preceding sentence and subparagraph (A), require the Association to make re- ports concerning the activities of any associated person whose business activities are reasonably likely to have a material impact on the financial or operational condition of the Association.
(C) SEPARATE OPERATION OF CORPORATIONS.— (i) IN GENERAL.—The funds and assets of the As- sociation shall at all times be maintained separately from the funds and assets of the Holding Company or any subsidiary of the Holding Company and may be used by the Association solely to carry out the Associa- tion’s purposes and to fulfill the Association’s obliga- tions.
(ii) BOOKS AND RECORDS.—The Association shall maintain books and records that clearly reflect the as- sets and liabilities of the Association, separate from the assets and liabilities of the Holding Company or any subsidiary of the Holding Company.

(iii) CORPORATE OFFICE.—The Association shall maintain a corporate office that is physically separate from any office of the Holding Company or any sub- sidiary of the Holding Company.
(iv) DIRECTOR.—No director of the Association who is appointed by the President pursuant to section 439(c)(1)(A) may serve as a director of the Holding Company.

(v) ONE OFFICER REQUIREMENT.—At least one offi- cer of the Association shall be an officer solely of the Association.
(vi) TRANSACTIONS.—Transactions between the As- sociation and the Holding Company or any subsidiary of the Holding Company, including any loan servicing arrangements, shall be on terms no less favorable to the Association than the Association could obtain from an unrelated third party offering comparable services.
(vii) CREDIT PROHIBITION.—The Association shall not extend credit to the Holding Company or any sub- sidiary of the Holding Company nor guarantee or pro- vide any credit enhancement to any debt obligations of September 8, 2023 As Amended Through P.L.

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440 HIGHER EDUCATION ACT OF 1965 462 the Holding Company or any subsidiary of the Holding Company.
(viii) AMOUNTS COLLECTED.—Any amounts col- lected on behalf of the Association by the Holding Company or any subsidiary of the Holding Company with respect to the assets of the Association, pursuant to a servicing contract or other arrangement between the Association and the Holding Company or any sub- sidiary of the Holding Company, shall be collected solely for the benefit of the Association and shall be immediately deposited by the Holding Company or such subsidiary to an account under the sole control of the Association.
(D) ENCUMBRANCE OF ASSETS.—Notwithstanding any Federal or State law, rule, or regulation, or legal or equi- table principle, doctrine, or theory to the contrary, under no circumstances shall the assets of the Association be available or used to pay claims or debts of or incurred by the Holding Company.
Nothing in this subparagraph shall be construed to limit the right of the Association to pay dividends not otherwise prohibited under this subpara- graph or to limit any liability of the Holding Company ex- plicitly provided for in this section.

(E) HOLDING COMPANY ACTIVITIES.—After the reorga- nization effective date and prior to the dissolution date, all business activities of the Holding Company shall be con- ducted through subsidiaries of the Holding Company.
(F) CONFIDENTIALITY.—Any information provided by the Association pursuant to this section shall be subject to the same confidentiality obligations contained in section 439(r)(12).

(G) DEFINITION.—For purposes of this paragraph, the term associated person’’ means any person, other than a natural person, who is directly or indirectly controlling, controlled by, or under common control with, the Associa- tion.
(9) ISSUANCE OF STOCK WARRANTS.— (A) IN GENERAL.—On the reorganization effective date, the Holding Company shall issue to the District of Colum- bia Financial Responsibility and Management Assistance Authority a number of stock warrants that is equal to one percent of the outstanding shares of the Association, deter- mined as of the last day of the fiscal quarter preceding the date of enactment of this section, with each stock warrant entitling the holder of the stock warrant to purchase from the Holding Company one share of the registered common stock of the Holding Company or the Holding Company’s successors or assigns, at any time on or before September 30, 2008.
The exercise price for such warrants shall be an amount equal to the average closing price of the common stock of the Association for the 20 business days prior to the date of enactment of this section on the exchange or market which is then the primary exchange or market for the common stock of the Association.

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440 shares of Holding Company common stock subject to each stock warrant and the exercise price of each stock warrant shall be adjusted as necessary to reflect— (i) the conversion of Association common stock into Holding Company common stock as part of the plan of reorganization approved by the Association’s shareholders; and (ii) any issuance or sale of stock (including issuance or sale of treasury stock), stock split, recapi- talization, reorganization, or other corporate event, if agreed to by the Secretary of the Treasury and the As- sociation.
(B) AUTHORITY TO SELL OR EXERCISE STOCK WARRANTS; DEPOSIT OF PROCEEDS.—The District of Columbia Financial Responsibility and Management Assistance Authority is authorized to sell or exercise the stock warrants described in subparagraph (A).
The District of Columbia Financial Responsibility and Management Assistance Authority shall deposit into the account established under section 3(e) of the Student Loan Marketing Association Reorganization Act of 1996 amounts collected from the sale and proceeds resulting from the exercise of the stock warrants pursuant to this subparagraph.
(10) RESTRICTIONS ON TRANSFER OF ASSOCIATION SHARES AND BANKRUPTCY OF ASSOCIATION.—After the reorganization ef- fective date, the Holding Company shall not sell, pledge, or otherwise transfer the outstanding shares of the Association, or agree to or cause the liquidation of the Association or cause the Association to file a petition for bankruptcy under title 11, United States Code, without prior approval of the Secretary of the Treasury and the Secretary of Education.
(d) TERMINATION OF THE ASSOCIATION.—In the event the share- holders of the Association approve a plan of reorganization under subsection (b), the Association shall dissolve, and the Association’s separate existence shall terminate on September 30, 2008, after discharge of all outstanding debt obligations and liquidation pursu- ant to this subsection.
The Association may dissolve pursuant to this subsection prior to such date by notifying the Secretary of Education and the Secretary of the Treasury of the Association’s in- tention to dissolve, unless within 60 days after receipt of such no- tice the Secretary of Education notifies the Association that the As- sociation continues to be needed to serve as a lender of last resort pursuant to section 439(q) or continues to be needed to purchase loans under an agreement with the Secretary described in sub- section (c)(6).
On the dissolution date, the Association shall take the following actions: (1) ESTABLISHMENT OF A TRUST.—The Association shall, under the terms of an irrevocable trust agreement that is in form and substance satisfactory to the Secretary of the Treas- ury, the Association and the appointed trustee, irrevocably transfer all remaining obligations of the Association to the trust and irrevocably deposit or cause to be deposited into such trust, to be held as trust funds solely for the benefit of holders of the remaining obligations, money or direct noncallable obli- September 8, 2023 As Amended Through P.L.
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440 HIGHER EDUCATION ACT OF 1965 464 gations of the United States or any agency thereof for which payment the full faith and credit of the United States is pledged, maturing as to principal and interest in such amounts and at such times as are determined by the Secretary of the Treasury to be sufficient, without consideration of any signifi- cant reinvestment of such interest, to pay the principal of, and interest on, the remaining obligations in accordance with their terms.
To the extent the Association cannot provide money or qualifying obligations in the amount required, the Holding Company shall be required to transfer money or qualifying ob- ligations to the trust in the amount necessary to prevent any deficiency.

(2) USE OF TRUST ASSETS.—All money, obligations, or fi- nancial assets deposited into the trust pursuant to this sub- section shall be applied by the trustee to the payment of the remaining obligations assumed by the trust.
(3) OBLIGATIONS NOT TRANSFERRED TO THE TRUST.—The Association shall make proper provision for all other obliga- tions of the Association not transferred to the trust, including the repurchase or redemption, or the making of proper provi- sion for the repurchase or redemption, of any preferred stock of the Association outstanding.

Any obligations of the Associa- tion which cannot be fully satisfied shall become liabilities of the Holding Company as of the date of dissolution.
(4) TRANSFER OF REMAINING ASSETS.—After compliance with paragraphs (1) and (3), any remaining assets of the trust shall be transferred to the Holding Company or any subsidiary of the Holding Company, as directed by the Holding Company.
(e) OPERATION OF THE HOLDING COMPANY.—In the event the shareholders of the Association approve the plan of reorganization under subsection (b), the following provisions shall apply beginning on the reorganization effective date: (1) HOLDING COMPANY BOARD OF DIRECTORS.—The number of members and composition of the Board of Directors of the Holding Company shall be determined as set forth in the Hold- ing Company’s charter or like instrument (as amended from time to time) or bylaws (as amended from time to time) and as permitted under the laws of the jurisdiction of the Holding Company’s incorporation.
(2) HOLDING COMPANY NAME.—The names of the Holding Company and any subsidiary of the Holding Company (other than the Association)— (A) may not contain the name ‘‘Student Loan Mar- keting Association’’; and (B) may contain, to the extent permitted by applicable State or District of Columbia law, ‘‘Sallie Mae’’ or vari- ations thereof, or such other names as the Board of Direc- tors of the Association or the Holding Company deems ap- propriate.
(3) USE OF SALLIE MAE NAME.—Subject to paragraph (2), the Association may assign to the Holding Company, or any subsidiary of the Holding Company, the ‘‘Sallie Mae’’ name as a trademark or service mark, except that neither the Holding Company nor any subsidiary of the Holding Company (other September 8, 2023 As Amended Through P.L.
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440 than the Association or any subsidiary of the Association) may use the ‘‘Sallie Mae’’ name on, or to identify the issuer of, any debt obligation or other security offered or sold by the Holding Company or any subsidiary of the Holding Company (other than a debt obligation or other security issued to and held by the Holding Company or any subsidiary of the Holding Com- pany).
The Association shall remit to the account established under section 3(e) of the Student Loan Marketing Association Reorganization Act of 1996, $5,000,000, within 60 days of the reorganization effective date as compensation for the right to assign the ‘‘Sallie Mae’’ name as a trademark or service mark.
(4) DISCLOSURE REQUIRED.—Until 3 years after the dissolu- tion date, the Holding Company, and any subsidiary of the Holding Company (other than the Association), shall promi- nently display— (A) in any document offering the Holding Company’s securities, a statement that the obligations of the Holding Company and any subsidiary of the Holding Company are not guaranteed by the full faith and credit of the United States; and (B) in any advertisement or promotional materials which use the ‘‘Sallie Mae’’ name or mark, a statement that neither the Holding Company nor any subsidiary of the Holding Company is a government-sponsored enter- prise or instrumentality of the United States.
(f) STRICT CONSTRUCTION.—Except as specifically set forth in this section, nothing in this section shall be construed to limit the authority of the Association as a federally chartered corporation, or of the Holding Company as a State or District of Columbia char- tered corporation.
(g) RIGHT TO ENFORCE.—The Secretary of Education or the Secretary of the Treasury, as appropriate, may request that the At- torney General bring an action in the United States District Court for the District of Columbia for the enforcement of any provision of this section, or may, under the direction or control of the Attor- ney General, bring such an action.

Such court shall have jurisdic- tion and power to order and require compliance with this section.
(h) DEADLINE FOR REORGANIZATION EFFECTIVE DATE.—This section shall be of no further force and effect in the event that the reorganization effective date does not occur on or before 18 months after the date of enactment of this section.

(i) DEFINITIONS.—For purposes of this section: (1) ASSOCIATION.—The term ‘‘Association’’ means the Stu- dent Loan Marketing Association.
(2) DISSOLUTION DATE.—The term ‘‘dissolution date’’ means September 30, 2008, or such earlier date as the Secretary of Education permits the transfer of remaining obligations in ac- cordance with subsection (d).
(3) HOLDING COMPANY.—The term ‘‘Holding Company’’ means the new business corporation established pursuant to this section by the Association under the laws of any State of the United States or the District of Columbia for the purposes of the reorganization and restructuring described in subsection (a).

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440A HIGHER EDUCATION ACT OF 1965 466 (4) REMAINING OBLIGATIONS.—The term ‘‘remaining obliga- tions’’ means the debt obligations of the Association out- standing as of the dissolution date.
(5) REMAINING PROPERTY.—The term ‘‘remaining property’’ means the following assets and liabilities of the Association which are outstanding as of the reorganization effective date: (A) Debt obligations issued by the Association.

(B) Contracts relating to interest rate, currency, or commodity positions or protections.

(C) Investment securities owned by the Association.
(D) Any instruments, assets, or agreements described in section 439(d) (including, without limitation, all student loans and agreements relating to the purchase and sale of student loans, forward purchase and lending commit- ments, warehousing advances, academic facilities obliga- tions, letters of credit, standby bond purchase agreements, liquidity agreements, and student loan revenue bonds or other loans).
(E) Except as specifically prohibited by this section or section 439, any other nonmaterial assets or liabilities of the Association which the Association’s Board of Directors determines to be necessary or appropriate to the Associa- tion’s operations.

(6) REORGANIZATION.—The term ‘‘reorganization’ means the restructuring event or events (including any merger event) giving effect to the Holding Company structure described in subsection (a).
(7) REORGANIZATION EFFECTIVE DATE.—The term ‘‘reorga- nization effective date’’ means the effective date of the reorga- nization as determined by the Board of Directors of the Asso- ciation, which shall not be earlier than the date that share- holder approval is obtained pursuant to subsection (b) and shall not be later than the date that is 18 months after the date of enactment of this section.

(8) SUBSIDIARY.—The term ‘‘subsidiary’’ means one or more direct or indirect subsidiaries.

SEC.

440A.
SEC.

440A.

DISCRIMINATION IN SECONDARY MARKETS PROHIBITED.
The Student Loan Marketing Association (and, if the Associa- tion is privatized under section 440, any successor entity func- tioning as a secondary market for loans under this part, including the Holding Company described in such section) shall not engage directly or indirectly in any pattern or practice that results in a de- nial of a borrower’s access to loans under this part because of the borrower’s race, sex, color, religion, national origin, age, disability status, income, attendance at a particular eligible institution, length of the borrower’s educational program, or the borrower’s academic year at an eligible institution.
PART C—FEDERAL WORK-STUDY PROGRAMS SEC.

441. ø20 U.S.C.

1087–51¿ PURPOSE; APPROPRIATIONS AUTHOR- IZED.

(a) PURPOSE.—The purpose of this part is to stimulate and pro- mote the part-time employment of students who are enrolled as un- September 8, 2023 As Amended Through P.L.
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442 dergraduate, graduate, or professional students and who are in need of earnings from employment to pursue courses of study at el- igible institutions, and to encourage students receiving Federal stu- dent financial assistance to participate in community service activi- ties that will benefit the Nation and engender in the students a sense of social responsibility and commitment to the community.
(b) AUTHORIZATION OF APPROPRIATIONS.—There are authorized to be appropriated to carry out this part, such sums as may be nec- essary for fiscal year 2009 and each of the five succeeding fiscal years.
(c) COMMUNITY SERVICES.—For purposes of this part, the term ‘‘community services’’ means services which are identified by an in- stitution of higher education, through formal or informal consulta- tion with local nonprofit, governmental, and community-based or- ganizations, as designed to improve the quality of life for commu- nity residents, particularly low-income individuals, or to solve par- ticular problems related to their needs, including— (1) such fields as health care, child care (including child care services provided on campus that are open and accessible to the community), literacy training, education (including tuto- rial services), welfare, social services, transportation, housing and neighborhood improvement, public safety, emergency pre- paredness and response, crime prevention and control, recre- ation, rural development, and community improvement; (2) work in a project, as defined in section 101(20) of the National and Community Service Act of 1990 (42 U.S.C.
12511(20)); (3) support services to students with disabilities, including students with disabilities who are enrolled at the institution; and (4) activities in which a student serves as a mentor for such purposes as— (A) tutoring; (B) supporting educational and recreational activities; and (C) counseling, including career counseling.

SEC.

442. ø20 U.S.C.

1087–52¿ ALLOCATION OF FUNDS.


(a) ALLOCATION BASED ON PREVIOUS ALLOCATION 48.—(1) From the amount appropriated pursuant to section 441(b) for each fiscal year, the Secretary shall first allocate to each eligible institution for each succeeding fiscal year, an amount equal to 100 percent of the amount such institution received under subsections (a) and (b) for fiscal year 1999 (as such subsections were in effect with respect to allocations for such fiscal year).
(2)(A) From the amount so appropriated, the Secretary shall next allocate to each eligible institution that began participation in the program under this part after fiscal year 1999 but is not a first or second time participant, an amount equal to the greater of— 48 The allocation provisions of section 413D of the Higher Education Act of 1965 were amend- ed by section 442 of the Higher Education Amendments of 1998 (P.L.

105–244; 112 Stat.

1712).


Subsection (c) of that section 442 contained the following effective date provision: (c) EFFECTIVE DATE.—The amendments made by this section shall apply with respect to allo- cations of amounts appropriated pursuant to section 441(b) for fiscal year 2000 or any suc- ceeding fiscal year.

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442 HIGHER EDUCATION ACT OF 1965 468 (i) $5,000; or (ii) 90 percent of the amount received and used under this part for the first year it participated in the program.
(B) From the amount so appropriated, the Secretary shall next allocate to each eligible institution that began participation in the program under this part after fiscal year 1999 and is a first or sec- ond time participant, an amount equal to the greatest of— (i) $5,000; (ii) an amount equal to (I) 90 percent of the amount re- ceived and used under this part in the second preceding fiscal year by eligible institutions offering comparable programs of instruction, divided by (II) the number of students enrolled at such comparable institutions in such fiscal year, multiplied by (III) the number of students enrolled at the applicant institu- tion in such fiscal year; or (iii) 90 percent of the institution’s allocation under this part for the preceding fiscal year.
(C) Notwithstanding subparagraphs (A) and (B) of this para- graph, the Secretary shall allocate to each eligible institution which— (i) was a first-time participant in the program in fiscal year 2000 or any subsequent fiscal year, and (ii) received a larger amount under this subsection in the second year of participation, an amount equal to 90 percent of the amount it received under this subsection in its second year of participation.
(3)(A) If the amount appropriated for any fiscal year is less than the amount required to be allocated to all institutions under paragraph (1) of this subsection, then the amount of the allocation to each such institution shall be ratably reduced.
(B) If the amount appropriated for any fiscal year is more than the amount required to be allocated to all institutions under para- graph (1) but less than the amount required to be allocated to all institutions under paragraph (2), then— (i) the Secretary shall allot the amount required to be allo- cated to all institutions under paragraph (1), and (ii) the amount of the allocation to each institution under paragraph (2) shall be ratably reduced.
(C) If additional amounts are appropriated for any such fiscal year, such reduced amounts shall be increased on the same basis as they were reduced (until the amount allocated equals the amount required to be allocated under paragraphs (1) and (2) of this subsection).
(4)(A) Notwithstanding any other provision of this section, the Secretary may allocate an amount equal to not more than 10 per- cent of the amount by which the amount appropriated in any fiscal year to carry out this part exceeds $700,000,000 among eligible in- stitutions described in subparagraph (B).
(B) In order to receive an allocation pursuant to subparagraph (A) an institution shall be an eligible institution from which 50 per- cent or more of the Pell Grant recipients attending such eligible in- stitution graduate or transfer to a 4-year institution of higher edu- cation.

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442 (b) ALLOCATION OF EXCESS BASED ON SHARE OF EXCESS ELIGI- BLE AMOUNTS.—(1) From the remainder of the amount appro- priated pursuant to section 441(b) after making the allocations re- quired by subsection (a), the Secretary shall allocate to each eligi- ble institution which has an excess eligible amount an amount which bears the same ratio to such remainder as such excess eligi- ble amount bears to the sum of the excess eligible amounts of all such eligible institutions (having such excess eligible amounts).
(2) For any eligible institution, the excess eligible amount is the amount, if any, by which— (A)(i) the amount of that institution’s need (as determined under subsection (c)), divided by (ii) the sum of the need of all institutions (as so determined), multiplied by (iii) the amount appropriated pursuant to section 441(b) for the fiscal year; ex- ceeds (B) the amount required to be allocated to that institution under subsection (a).
(c) DETERMINATION OF INSTITUTION’S NEED.—(1) The amount of an institution’s need is equal to the sum of the self-help need of the institution’s eligible undergraduate students and the self-help need of the institution’s eligible graduate and professional stu- dents.
(2) To determine the self-help need of an institution’s eligible undergraduate students, the Secretary shall— (A) establish various income categories for dependent and independent undergraduate students; (B) establish an expected family contribution 1 for each in- come category of dependent and independent undergraduate students, determined on the basis of the average expected fam- ily contribution 1 (computed in accordance with part F of this title) of a representative sample within each income category for the second preceding fiscal year; (C) compute 25 percent of the average cost of attendance for all undergraduate students; (D) multiply the number of eligible dependent students in each income category by the lesser of— (i) 25 percent of the average cost of attendance for all undergraduate students determined under subparagraph (C); or (ii) the average cost of attendance for all under- graduate students minus the expected family contribution 1 determined under subparagraph (B) for that income cat- egory, except that the amount computed by such subtrac- tion shall not be less than zero; (E) add the amounts determined under subparagraph (D) for each income category of dependent students; and (F) multiply the number of eligible independent students in ach income category by the lesser of— (i) 25 percent of the average cost of attendance for all undergraduate students determined under subparagraph (C); or (ii) the average cost of attendance for all under- graduate students minus the expected family contribution 1 determined under subparagraph (B) for that income cat- September 8, 2023 As Amended Through P.L.
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442 HIGHER EDUCATION ACT OF 1965 470 egory, except that the amount computed by such subtrac- tion for any income category shall not be less than zero; (G) add the amounts determined under subparagraph (F) for each income category of independent students; and (H) add the amounts determined under subparagraphs (E) and (G).
(3) To determine the self-help need of an institution’s eligible graduate and professional students, the Secretary shall— (A) establish various income categories of graduate and professional students; (B) establish an expected family contribution 1 for each in- come category of graduate and professional students, deter- mined on the basis of the average expected family contribu- tion 1 (computed in accordance with part F of this title) of a representative sample within each income category for the sec- ond preceding fiscal year; (C) determine the average cost of attendance for all grad- uate and professional students; (D) subtract from the average cost of attendance for all graduate and professional students (determined under sub- paragraph (C)), the expected family contribution 1 (determined under subparagraph (B)) for each income category, except that the amount computed by such subtraction for any income cat- egory shall not be less than zero; (E) multiply the amounts determined under subparagraph (D) by the number of eligible students in each category; and (F) add the amounts determined under subparagraph (E) of this paragraph for each income category.
(4)(A) For purposes of paragraphs (2) and (3), the term ‘‘aver- age cost of attendance’’ means the average of the attendance costs for undergraduate students and for graduate and professional stu- dents, which shall include (i) tuition and fees determined in accord- ance with subparagraph (B), (ii) standard living expenses deter- mined in accordance with subparagraph (C), and (iii) books and supplies determined in accordance with subparagraph (D).
(B) The average undergraduate and graduate and professional tuition and fees described in subparagraph (A)(i) shall be computed on the basis of information reported by the institution to the Sec- retary, which shall include (i) total revenue received by the institu- tion from undergraduate and graduate tuition and fees for the sec- ond year preceding the year for which it is applying for an alloca- tion, and (ii) the institution’s enrollment for such second preceding year.
(C) The standard living expense described in subparagraph (A)(ii) is equal to 150 percent of the difference between the income protection allowance for a family of five with one in college and the income protection allowance for a family of six with one in college for a single independent student.

(D) The allowance for books and supplies described in subpara- graph (A)(iii) is equal to $600.
(d) REALLOCATION OF EXCESS ALLOCATIONS.—(1) If institutions return to the Secretary any portion of the sums allocated to such institutions under this section for any fiscal year, the Secretary shall reallot such excess to eligible institutions which used at least September 8, 2023 As Amended Through P.L.
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443 5 percent of the total amount of funds granted to such institution under this section to compensate students employed in tutoring in reading and family literacy activities in the preceding fiscal year.
Such excess funds shall be reallotted to institutions which qualify under this subsection on the same basis as excess eligible amounts are allocated to institutions pursuant to subsection (b).

Funds re- ceived by institutions pursuant to this subsection shall be used to compensate students employed in community service.
(2) If, under paragraph (1) of this subsection, an institution re- turns more than 10 percent of its allocation, the institution’s alloca- tion for the next fiscal year shall be reduced by the amount re- turned.

The Secretary may waive this paragraph for a specific in- stitution if the Secretary finds that enforcing this paragraph would be contrary to the interest of the program.
(e) FILING DEADLINES.—The Secretary shall, from time to time, set dates before which institutions must file applications for alloca- tions under this part.

SEC.

443. ø20 U.S.C.

1087–53¿ GRANTS FOR FEDERAL WORK-STUDY PRO- GRAMS.

(a) AGREEMENTS REQUIRED.—The Secretary is authorized to enter into agreements with institutions of higher education under which the Secretary will make grants to such institutions to assist in the operation of work-study programs as provided in this part.
(b) CONTENTS OF AGREEMENTS.—An agreement entered into pursuant to this section shall— (1) provide for the operation by the institution of a pro- gram for the part-time employment, including internships, practica, or research assistantships as determined by the Sec- retary, of its students in work for the institution itself, work in community service or work in the public interest for a Fed- eral, State, or local public agency or private nonprofit organiza- tion under an arrangement between the institution and such agency or organization, and such work— (A) will not result in the displacement of employed workers or impair existing contracts for services; (B) will be governed by such conditions of employment as will be appropriate and reasonable in light of such fac- tors as type of work performed, geographical region, and proficiency of the employee; (C) does not involve the construction, operation, or maintenance of so much of any facility as is used or is to be used for sectarian instruction or as a place for religious worship; and (D) will not pay any wage to students employed under this subpart that is less than the current Federal min- imum wage as mandated by section 6(a) of the Fair Labor Standards Act of 1938; (2) provide that funds granted an institution of higher edu- cation, pursuant to this section, may be used only to make pay- ments to students participating in work-study programs, ex- cept that— (A) for fiscal year 2000 and succeeding fiscal years, an institution shall use at least 7 percent of the total amount of funds granted to such institution under this section for September 8, 2023 As Amended Through P.L.
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443 HIGHER EDUCATION ACT OF 1965 472 such fiscal year to compensate students employed in com- munity service, and shall ensure that not less than 1 tu- toring or family literacy project (as described in subsection (d)) is included in meeting the requirement of this sub- paragraph, except that the Secretary may waive this sub- paragraph if the Secretary determines that enforcing this subparagraph would cause hardship for students at the in- stitution; and (B) an institution may use a portion of the sums granted to it to meet administrative expenses in accord- ance with section 489 of this Act, may use a portion of the sums granted to it to meet the cost of a job location and development program in accordance with section 446 of this part, and may transfer funds in accordance with the provisions of section 488 of this Act; (3) provide that in the selection of students for employ- ment under such work-study program, only students who dem- onstrate financial need in accordance with part F and meet the requirements of section 484 will be assisted, except that if the institution’s grant under this part is directly or indirectly based in part on the financial need demonstrated by students who are (A) attending the institution on less than a full-time basis, or (B) independent students, a reasonable portion of the grant shall be made available to such students; (4) provide that for a student employed in a work-study program under this part, at the time income derived from any need-based employment is in excess of the determination of the amount of such student’s need by more than $300, continued employment shall not be subsidized with funds appropriated under this part; (5) provide that the Federal share of the compensation of students employed in the work-study program in accordance with the agreement shall not exceed 75 percent, except that— (A) the Federal share may exceed 75 percent, but not exceed 90 percent, if, consistent with regulations of the Secretary— (i) the student is employed at a nonprofit private
 organization or a government agency that— (I) is not a part of, and is not owned, oper- ated, or controlled by, or under common owner- ship, operation, or control with, the institution; (II) is selected by the institution on an indi- vidual case-by-case basis for such student; and (III) would otherwise be unable to afford the costs of such employment; and (ii) not more than 10 percent of the students com- pensated through the institution’s grant under this part during the academic year are employed in posi- tions for which the Federal share exceeds 75 percent; and (B) the Federal share may exceed 75 percent if the Secretary determines, pursuant to regulations promul- gated by the Secretary establishing objective criteria for such determinations, that a Federal share in excess of September 8, 2023 As Amended Through P.L.
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443 such amounts is required in furtherance of the purpose of this part; (6) include provisions to make employment under such work-study program reasonably available (to the extent of available funds) to all eligible students in the institution in need thereof; (7) provide assurances that employment made available from funds under this part will, to the maximum extent prac- ticable, complement and reinforce the educational program or vocational goals of each student receiving assistance under this part; (8) provide assurances, in the case of each proprietary in- stitution, that students attending the proprietary institution receiving assistance under this part who are employed by the institution may be employed in jobs— (A) that are only on campus and that— (i) to the maximum extent practicable, com- plement and reinforce the education programs or voca- tional goals of such students; and (ii) furnish student services that are directly re- lated to the student’s education, as determined by the Secretary pursuant to regulations, except that no stu- dent shall be employed in any position that would in- volve the solicitation of other potential students to en- roll in the school; or (B) in community service in accordance with para- graph (2)(A) of this subsection; (9) provide assurances that employment made available from funds under this part may be used to support programs for supportive services to students with disabilities; (10) provide assurances that the institution will inform all eligible students of the opportunity to perform community serv- ice, and will consult with local nonprofit, governmental, and community-based organizations to identify such opportunities; and (11) include such other reasonable provisions as the Sec- retary shall deem necessary or appropriate to carry out the purpose of this part.
(c) PRIVATE SECTOR EMPLOYMENT AGREEMENT.—As part of its agreement described in subsection (b), an institution of higher edu- cation may, at its option, enter into an additional agreement with the Secretary which shall— (1) provide for the operation by the institution of a pro- gram of part-time employment of its students in work for a pri- vate for-profit organization under an arrangement between the institution and such organization that complies with the re- quirements of subparagraphs (A) through (D) of subsection (b)(1) and subsection (b)(3); (2) provide that the institution will use not more than 25 percent of the funds made available to such institution under this part for any fiscal year for the operation of the program described in paragraph (1); (3) provide that, notwithstanding subsection (b)(5), the Federal share of the compensation of students employed in September 8, 2023 As Amended Through P.L.
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443 HIGHER EDUCATION ACT OF 1965 474 such program will not exceed 60 percent for academic years 1987–1988 and 1988–1989, 55 percent for academic year 1989– 1990, and 50 percent for academic year 1990–1991 and suc- ceeding academic years, and that the non-Federal share of such compensation will be provided by the private for-profit or- ganization in which the student is employed; (4) provide that jobs under the work study program will be academically relevant, to the maximum extent practicable; and (5) provide that the for-profit organization will not use funds made available under this part to pay any employee who would otherwise be employed by the organization.
(d) TUTORING AND LITERACY ACTIVITIES.— (1) USE OF FUNDS.—In any academic year to which sub- section (b)(2)(A) applies, an institution shall ensure that funds granted to such institution under this section are used in ac- cordance with such subsection to compensate (including com- pensation for time spent in training and travel directly related to tutoring in reading and family literacy activities) students— (A) employed as reading tutors for children who are preschool age or are in elementary school; or (B) employed in family literacy projects.
(2) PRIORITY FOR SCHOOLS.—To the extent practicable, an institution shall— (A) give priority to the employment of students in the provision of tutoring in reading in schools that are partici- pating in a reading reform project that— (i) is designed to train teachers how to teach read- ing on the basis of scientifically-based research on reading; and (ii) is funded under the Elementary and Sec- ondary Education Act of 1965; and (B) ensure that any student compensated with the funds described in paragraph (1) who is employed in a school participating in a reading reform project described in subparagraph (A) receives training from the employing school in the instructional practices used by the school.
(3) FEDERAL SHARE.—The Federal share of the compensa- tion of work-study students compensated under this subsection may exceed 75 percent.
(e) CIVIC EDUCATION AND PARTICIPATION ACTIVITIES.— (1) USE OF FUNDS.—Funds granted to an institution under this section may be used to compensate (including compensa- tion for time spent in training and travel directly related to civic education and participation activities) students employed in projects that— (A) teach civics in schools; (B) raise awareness of government functions or re- sources; or (C) increase civic participation.
(2) PRIORITY FOR SCHOOLS.—To the extent practicable, an institution shall— (A) give priority to the employment of students partici- pating in projects that educate or train the public about evacuation, emergency response, and injury prevention September 8, 2023 As Amended Through P.L.
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445 strategies relating to natural disasters, acts of terrorism, and other emergency situations; and (B) ensure that any student compensated with the funds described in paragraph (1) receives appropriate training to carry out the educational services required.
(3) FEDERAL SHARE.—The Federal share of the compensa- tion of work-study students compensated under this subsection may exceed 75 percent.

SEC.

444. ø20 U.S.C.

1087–54 note¿ SOURCES OF MATCHING FUNDS.


Nothing in this part shall be construed as restricting the source (other than this part) from which the institution may pay its share of the compensation of a student employed under a work- study program covered by an agreement under this part, and such share may be paid to such student in the form of services and equipment (including tuition, room, board, and books) furnished by such institution.

SEC.

445. ø20 U.S.C.

1087–55¿ FLEXIBLE USE OF FUNDS.


(a) CARRY-OVER AUTHORITY.—(1) Of the sums granted to an el- igible institution under this part for any fiscal year, 10 percent may, at the discretion of the institution, remain available for ex- penditure during the succeeding fiscal year to carry out programs under this part.
(2) Any of the sums so granted to an institution for a fiscal year which are not needed by that institution to operate work- study programs during that fiscal year, and which it does not wish to use during the next fiscal year as authorized in the preceding sentence, shall remain available to the Secretary for making grants under section 443 to other institutions in the same State until the close of the second fiscal year next succeeding the fiscal year for which such funds were appropriated.
(b) CARRY-BACK AUTHORITY.—(1) Up to 10 percent of the sums the Secretary determines an eligible institution may receive from funds which have been appropriated for a fiscal year may be used by the Secretary to make grants under this part to such institution for expenditure during the fiscal year preceding the fiscal year for which the sums were appropriated.
(2) An eligible institution may make payments to students of wages earned after the end of the academic year, but prior to the beginning of the succeeding fiscal year, from such succeeding fiscal year’s appropriations.

(c) FLEXIBLE USE OF FUNDS.—An eligible institution may, upon the request of a student, make payments to the student under this part by crediting the student’s account at the institution or by making a direct deposit to the student’s account at a depository in- stitution.
An eligible institution may only credit the student’s ac- count at the institution for (1) tuition and fees, (2) in the case of institutionally owned housing, room and board, and (3) other insti- tutionally provided goods and services.
(d) FLEXIBILITY IN THE EVENT OF A MAJOR DISASTER.— (1) IN GENERAL.—In the event of a major disaster, an eligi- ble institution located in any area affected by such major dis- aster, as determined by the Secretary, may make payments under this part to disaster-affected students, for the period of September 8, 2023 As Amended Through P.L.
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446 HIGHER EDUCATION ACT OF 1965 476 time (not to exceed one academic year) in which the disaster- affected students were prevented from fulfilling the students’ work-study obligations as described in paragraph (2)(A)(iii), as follows: (A) Payments may be made under this part to dis- aster-affected students in an amount equal to or less than the amount of wages such students would have been paid under this part had the students been able to complete the work obligation necessary to receive work study funds.
(B) Payments shall not be made to any student who was not eligible for work study or was not completing the work obligation necessary to receive work study funds under this part prior to the occurrence of the major dis- aster.

(C) Any payments made to disaster-affected students under this subsection shall meet the matching require- ments of section 443, unless such matching requirements are waived by the Secretary.
(2) DEFINITIONS.—In this subsection: (A) The term ‘‘disaster-affected student’’ means a stu- dent enrolled at an eligible institution who— (i) received a work-study award under this section for the academic year during which a major disaster occurred; (ii) earned Federal work-study wages from such eligible institution for such academic year; (iii) was prevented from fulfilling the student’s work-study obligation for all or part of such academic year due to such major disaster; and (iv) was unable to be reassigned to another work- study job.
(B) The term ‘‘major disaster’’ has the meaning given such term in section 102(2) of the Robert T. Stafford Dis- aster Relief and Emergency Assistance Act (42 U.S.C.

5122(2)).

SEC.

446. ø20 U.S.C.

1087–56¿ JOB LOCATION AND DEVELOPMENT PRO- GRAMS.
(a) AGREEMENTS REQUIRED.—(1) The Secretary is authorized to enter into agreements with eligible institutions under which such institution may use not more than 10 percent or $75,000 of its al- lotment under section 442, whichever is less, to establish or expand a program under which such institution, separately or in combina- tion with other eligible institutions, locates and develops jobs, in- cluding community service jobs, for currently enrolled students.
(2) Jobs located and developed under this section shall be jobs that are suitable to the scheduling and other needs of such stu- dents and that, to the maximum extent practicable, complement and reinforce the educational programs or vocational goals of such students.

(b) CONTENTS OF AGREEMENTS.—Agreements under subsection (a) shall— (1) provide that the Federal share of the cost of any pro- gram under this section will not exceed 80 percent of such cost; September 8, 2023 As Amended Through P.L.
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447 (2) provide satisfactory assurance that funds available under this section will not be used to locate or develop jobs at an eligible institution; (3) provide satisfactory assurance that funds available under this section will not be used for the location or develop- ment of jobs for students to obtain upon graduation, but rather for the location and development of jobs available to students during and between periods of attendance at such institution; (4) provide satisfactory assurance that the location or de- velopment of jobs pursuant to programs assisted under this section will not result in the displacement of employed workers or impair existing contracts for services; (5) provide satisfactory assurance that Federal funds used for the purpose of this section can realistically be expected to help generate student wages exceeding, in the aggregate, the amount of such funds, and that if such funds are used to con- tract with another organization, appropriate performance standards are part of such contract; and (6) provide that the institution will submit to the Secretary an annual report on the uses made of funds provided under this section and an evaluation of the effectiveness of such pro- gram in benefiting the students of such institution.
SEC.

447. ø20 U.S.C.

1087–57¿ ADDITIONAL FUNDS TO CONDUCT COMMU- NITY SERVICE WORK-STUDY PROGRAMS.
(a) COMMUNITY SERVICE-LEARNING.—Each institution partici- pating under this part may use up to 10 percent of the funds made available under section 489(a) and attributable to the amount of the institution’s expenditures under this part to conduct that insti- tution’s program of community service-learning, including— (1) development of mechanisms to assure the academic quality of the student experience, (2) assuring student access to educational resources, exper- tise, and supervision necessary to achieve community service objectives, and (3) collaboration with public and private nonprofit agen- cies, and programs assisted under the National and Commu- nity Service Act of 1990 in the planning, development, and ad- ministration of such programs.
(b) OFF-CAMPUS COMMUNITY SERVICE.— (1) GRANTS AUTHORIZED.—In addition to funds made avail- able under section 443(b)(2)(A), the Secretary is authorized to award grants to institutions participating under this part to supplement off-campus community service employment.
(2) USE OF FUNDS.—An institution shall ensure that funds granted to such institution under this subsection are used in accordance with section 443(b)(2)(A) to recruit and compensate students (including compensation for time spent in training and for travel directly related to such community service).
(3) PRIORITY.—In awarding grants under this subsection, the Secretary shall give priority to applications that support postsecondary students assisting with early childhood edu- cation activities and activities in preparation for emergencies and natural disasters.

September 8, 2023 As Amended Through P.L.

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448 HIGHER EDUCATION ACT OF 1965 478 (4) AUTHORIZATION OF APPROPRIATIONS.—There are author- ized to be appropriated to carry out this subsection such sums as may be necessary for fiscal year 2009 and each of the five succeeding fiscal years.

SEC.

448. ø20 U.S.C.

1087–58¿ WORK COLLEGES.


(a) PURPOSE.—The purpose of this section is to recognize, en- courage, and promote the use of comprehensive work-learning-serv- ice programs as a valuable educational approach when it is an inte- gral part of the institution’s educational program and a part of a financial plan which decreases reliance on grants and loans.
(b) SOURCE AND USE FUNDS.— (1) SOURCE OF FUNDS.—In addition to the sums appro- priated under subsection (f), funds allocated to the institution under part C and part E of this title may be transferred for use under this section to provide flexibility in strengthening the self-help-through-work element in financial aid packaging.
(2) ACTIVITIES AUTHORIZED.—From the sums appropriated pursuant to subsection (f), and from the funds available under paragraph (1), eligible institutions may, following approval of an application under subsection (c) by the Secretary— (A) support the educational costs of qualified students through self-help payments or credits provided under the work-learning-service program of the institution within the limits of part F of this title; (B) promote the work-learning-service experience as a tool of postsecondary education, financial self-help and community service-learning opportunities; (C) carry out activities described in section 443 or 446; (D) be used for the administration, development and assessment of comprehensive work-learning-service pro- grams, including— (i) community-based work-learning-service alter- natives that expand opportunities for community serv- ice and career-related work; and (ii) alternatives that develop sound citizenship, en- courage student persistence, and make optimum use of assistance under this part in education and student development; (E) coordinate and carry out joint projects and activi- ties to promote work service learning; and (F) carry out a comprehensive, longitudinal study of student academic progress and academic and career out- comes, relative to student self-sufficiency in financing their higher education, repayment of student loans, continued community service, kind and quality of service performed, and career choice and community service selected after graduation.
(c) APPLICATION.—Each eligible institution may submit an ap- plication for funds authorized by subsection (f) to use funds under subsection (b)(1) at such time and in such manner as the Secretary, by regulation, may reasonably require.

September 8, 2023 As Amended Through P.L.


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451 (d) MATCH REQUIRED.—Funds made available to work-colleges pursuant to this section shall be matched on a dollar-for-dollar basis from non-Federal sources.
(e) DEFINITIONS.—For the purpose of this section— (1) the term ‘‘work college’’ means an eligible institution that— (A) has been a public or private nonprofit, four-year, degree-granting institution with a commitment to commu- nity service; (B) has operated a comprehensive work-learning-serv- ice program for at least two years; (C) requires students, including at least one-half of all students who are enrolled on a full-time basis, to partici- pate in a comprehensive work-learning-service program for at least five hours each week, or at least 80 hours during each period of enrollment, except summer school, unless the student is engaged in an institutionally organized or approved study abroad or externship program; and (D) provides students participating in the comprehen- sive work-learning-service program with the opportunity to contribute to their education and to the welfare of the com- munity as a whole; and (2) the term ‘‘comprehensive student work-learning-service program’’ means a student work-learning-service program that— (A) is an integral and stated part of the institution’s educational philosophy and program; (B) requires participation of all resident students for enrollment and graduation; (C) includes learning objectives, evaluation, and a record of work performance as part of the student’s college record; (D) provides programmatic leadership by college per- sonnel at levels comparable to traditional academic pro- grams; (E) recognizes the educational role of work-learning- service supervisors; and (F) includes consequences for nonperformance or fail- ure in the work-learning-service program similar to the consequences for failure in the regular academic program.
(f) AUTHORIZATION OF APPROPRIATIONS.—There are authorized to be appropriated to carry out this section such sums as may be necessary for fiscal year 2009 and each of the five succeeding fiscal years.

PART D—WILLIAM D. FORD FEDERAL DIRECT LOAN PROGRAM SEC.

451. ø20 U.S.C.

1087a¿ PROGRAM AUTHORITY.


(a) IN GENERAL.—There are hereby made available, in accord- ance with the provisions of this part, such sums as may be nec- essary (1) to make loans to all eligible students (and the eligible parents of such students) in attendance at participating institu- September 8, 2023 As Amended Through P.L.
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452 HIGHER EDUCATION ACT OF 1965 480 tions of higher education selected by the Secretary, to enable such students to pursue their courses of study at such institutions dur- ing the period beginning July 1, 1994; and (2) for purchasing loans under section 459A.
Loans made under this part shall be made by participating institutions, or consortia thereof, that have agree- ments with the Secretary to originate loans, or by alternative origi- nators designated by the Secretary to make loans for students in attendance at participating institutions (and their parents).

(b) DESIGNATION.— (1) PROGRAM.—The program established under this part shall be referred to as the ‘‘William D. Ford Federal Direct Loan Program’’.
(2) DIRECT LOANS.—Notwithstanding any other provision of this part, loans made to borrowers under this part that, ex- cept as otherwise specified in this part, have the same terms, conditions, and benefits as loans made to borrowers under sec- tion 428, shall be known as ‘‘Federal Direct Stafford/Ford Loans’’.

øNote: Effective on July 1, 2024, section 702(a)(2) of division FF of Public Law 116–260 provides for an amendment to add a new sub- section (c) at the end of section 451.
Upon such date, subsection (c) (as added) will read as follows:¿ (c) MAXIMUM AID.—The maximum dollar amount of financial assistance provided under this part to a student shall not exceed the cost of attendance for such student.

SEC.

452. ø20 U.S.C.

1087b¿ FUNDS FOR ORIGINATION OF DIRECT STU- DENT LOANS.
(a) IN GENERAL.—The Secretary shall provide, on the basis of the need and the eligibility of students at each participating insti- tution, and parents of such students, for such loans, funds for stu- dent and parent loans under this part— (1) directly to an institution of higher education that has an agreement with the Secretary under section 454(a) to par- ticipate in the direct student loan programs under this part and that also has an agreement with the Secretary under sec- tion 454(b) to originate loans under this part; or (2) through an alternative originator designated by the Secretary to students (and parents of students) attending insti- tutions of higher education that have an agreement with the Secretary under section 454(a) but that do not have an agree- ment with the Secretary under section 454(b).
(b) NO ENTITLEMENT TO PARTICIPATE OR ORIGINATE.—No insti- tution of higher education shall have a right to participate in the programs authorized by this part, to originate loans, or to perform any program function under this part.

Nothing in this subsection shall be construed so as to limit the entitlement of an eligible stu- dent attending a participating institution (or the eligible parent of such student) to borrow under this part.
(c) DELIVERY OF LOAN FUNDS.—Loan funds shall be paid and delivered to an institution by the Secretary prior to the beginning of the payment period established by the Secretary in a manner September 8, 2023 As Amended Through P.L.

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453 that is consistent with payment and delivery of Federal Pell Grants under subpart 1 of part A of this title.
(d) INSTITUTIONS OUTSIDE THE UNITED STATES.—Loan funds for students (and parents of students) attending institutions out- side the United States shall be disbursed through a financial insti- tution located or operating in the United States and designated by the Secretary to serve as the agent of such institutions with respect to the receipt of the disbursements of such loan funds and the transfer of such funds to such institutions.
To be eligible to receive funds under this part, an institution outside the United States shall make arrangements with the agent designated by the Sec- retary under this subsection to receive funds under this part.

SEC.

453. ø20 U.S.C.

1087c¿ SELECTION OF INSTITUTIONS FOR PARTICI- PATION AND ORIGINATION.
(a) GENERAL AUTHORITY.—The Secretary shall enter into agreements pursuant to section 454(a) with institutions of higher education to participate in the direct student loan program under this part, and agreements pursuant to section 454(b) with institu- tions of higher education, or consortia thereof, to originate loans in such program, for academic years beginning on or after July 1, 1994.
Alternative origination services, through which an entity other than the participating institution at which the student is in attendance originates the loan, shall be provided by the Secretary, through 1 or more contracts under section 456(b) or such other means as the Secretary may provide, for students attending partici- pating institutions that do not originate direct student loans under this part.
Such agreements for the academic year 1994–1995 shall, to the extent feasible, be entered into not later than January 1, 1994.

(b) SELECTION CRITERIA.— (1) APPLICATION.—Each institution of higher education de- siring to participate in the direct student loan program under this part shall submit an application satisfactory to the Sec- retary containing such information and assurances as the Sec- retary may require.
(2) SELECTION PROCEDURE.—The Secretary shall select in- stitutions for participation in the direct student loan program under this part, and shall enter into agreements with such in- stitutions under section 454(a), from among those institutions that submit the applications described in paragraph (1), and meet such other eligibility requirements as the Secretary shall prescribe.
(c) SELECTION CRITERIA FOR ORIGINATION.— (1) IN GENERAL.—The Secretary may enter into a supple- mental agreement with an institution (or a consortium of such institutions) that— (A) has an agreement under subsection 454(a); (B) desires to originate loans under this part; and (C) meets the criteria described in paragraph (2).
(2) SELECTION CRITERIA.—The Secretary may approve an institution to originate loans only if such institution— (A) is not on the reimbursement system of payment for any of the programs under subpart 1 or 3 of part A, part C, or part E of this title; September 8, 2023 As Amended Through P.L.

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454 HIGHER EDUCATION ACT OF 1965 482 (B) is not overdue on program or financial reports or audits required under this title; (C) is not subject to an emergency action, or a limita- tion, suspension, or termination under section 428(b)(1)(T), 432(h), or 487(c); (D) in the opinion of the Secretary, has not had severe performance deficiencies for any of the programs under this title, including such deficiencies demonstrated by au- dits or program reviews submitted or conducted during the 5 calendar years immediately preceding the date of appli- cation; (E) provides an assurance that such institution has no delinquent outstanding debts to the Federal Government, unless such debts are being repaid under or in accordance with a repayment arrangement satisfactory to the Federal Government, or the Secretary in the Secretary’s discretion determines that the existence or amount of such debts has not been finally determined by the cognizant Federal agen- cy; and (F) meets such other criteria as the Secretary may es- tablish to protect the financial interest of the United States and to promote the purposes of this part.
(d) ELIGIBLE INSTITUTIONS.—The Secretary may not select an institution of higher education for participation under this section unless such institution is an eligible institution under section 435(a).
(e) CONSORTIA.—Subject to such requirements as the Secretary may prescribe, eligible institutions of higher education (as deter- mined under subsection (d)) with agreements under section 454(a) may apply to the Secretary as consortia to originate loans under this part for students in attendance at such institutions.

Each such institution shall be required to meet the requirements of subsection (c) with respect to loan origination.

SEC.

454. ø20 U.S.C.

1087d¿ AGREEMENTS WITH INSTITUTIONS.
(a) PARTICIPATION AGREEMENTS.—An agreement with any in- stitution of higher education for participation in the direct student loan program under this part shall— (1) provide for the establishment and maintenance of a di- rect student loan program at the institution under which the institution will— (A) identify eligible students who seek student finan- cial assistance at such institution in accordance with sec- tion 484; (B) estimate the need of each such student as required by part F of this title for an academic year, except that, any loan obtained by a student under this part with the same terms as loans made under section 428H (except as otherwise provided in this part), or a loan obtained by a parent under this part with the same terms as loans made under section 428B (except as otherwise provided in this part), or obtained under any State-sponsored or private loan program, may be used to offset the expected family contribution 1 of the student for that year; September 8, 2023 As Amended Through P.L.
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454 (C) provide a statement that certifies the eligibility of any student to receive a loan under this part that is not in excess of the annual or aggregate limit applicable to such loan, except that the institution may, in exceptional circumstances identified by the Secretary, refuse to certify a statement that permits a student to receive a loan under this part, or certify a loan amount that is less than the student’s determination of need (as determined under part F of this title), if the reason for such action is documented and provided in written form to such student; (D) set forth a schedule for disbursement of the pro- ceeds of the loan in installments, consistent with the re- quirements of section 428G; and (E) provide timely and accurate information— (i) concerning the status of student borrowers (and students on whose behalf parents borrow under this part) while such students are in attendance at the in- stitution and concerning any new information of which the institution becomes aware for such students (or their parents) after such borrowers leave the institu- tion, to the Secretary for the servicing and collecting of loans made under this part; and (ii) if the institution does not have an agreement with the Secretary under subsection (b), concerning student eligibility and need, as determined under sub- paragraphs (A) and (B), to the Secretary as needed for the alternative origination of loans to eligible students and parents in accordance with this part; (2) provide assurances that the institution will comply with requirements established by the Secretary relating to stu- dent loan information with respect to loans made under this part; (3) provide that the institution accepts responsibility and financial liability stemming from its failure to perform its func- tions pursuant to the agreement; (4) provide for the implementation of a quality assurance system, as established by the Secretary and developed in con- sultation with institutions of higher education, to ensure that the institution is complying with program requirements and meeting program objectives; (5) provide that the institution will not charge any fees of any kind, however described, to student or parent borrowers for origination activities or the provision of any information necessary for a student or parent to receive a loan under this part, or any benefits associated with such loan; and (6) include such other provisions as the Secretary deter- mines are necessary to protect the interests of the United States and to promote the purposes of this part.
(b) ORIGINATION.—An agreement with any institution of higher education, or consortia thereof, for the origination of loans under this part shall— (1) supplement the agreement entered into in accordance with subsection (a); September 8, 2023 As Amended Through P.L.

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455 HIGHER EDUCATION ACT OF 1965 484 (2) include provisions established by the Secretary that are similar to the participation agreement provisions described in paragraphs (1)(E)(ii), (2), (3), (4), (5), and (6) of subsection (a), as modified to relate to the origination of loans by the institu- tion or consortium; (3) provide that the institution or consortium will originate loans to eligible students and parents in accordance with this part; and (4) provide that the note or evidence of obligation on the loan shall be the property of the Secretary.
(c) WITHDRAWAL AND TERMINATION PROCEDURES.—The Sec- retary shall establish procedures by which institutions or consortia may withdraw or be terminated from the program under this part.

SEC.

455. ø20 U.S.C.

1087e¿ TERMS AND CONDITIONS OF LOANS.


(a) IN GENERAL.— (1) PARALLEL TERMS, CONDITIONS, BENEFITS, AND AMOUNTS.—Unless otherwise specified in this part, loans made to borrowers under this part shall have the same terms, condi- tions, and benefits, and be available in the same amounts, as loans made to borrowers, and first disbursed on June 30, 2010, 49 under sections 428, 428B, 428C, and 428H of this title.
(2) DESIGNATION OF LOANS.—Loans made to borrowers under this part that, except as otherwise specified in this part, have the same terms, conditions, and benefits as loans made to borrowers under— (A) section 428 shall be known as ‘‘Federal Direct Staf- ford Loans’’; (B) section 428B shall be known as ‘‘Federal Direct PLUS Loans’’; (C) section 428C shall be known as ‘‘Federal Direct Consolidation Loans’’; and (D) section 428H shall be known as ‘‘Federal Direct Unsubsidized Stafford Loans’’.
(3) TERMINATION OF AUTHORITY TO MAKE INTEREST SUB- SIDIZED LOANS TO GRADUATE AND PROFESSIONAL STUDENTS.— (A) IN GENERAL.—Subject to subparagraph (B) and notwithstanding any provision of this part or part B, for any period of instruction beginning on or after July 1, 2012— (i) a graduate or professional student shall not be eligible to receive a Federal Direct Stafford loan under this part; and (ii) the maximum annual amount of Federal Di- rect Unsubsidized Stafford loans such a student may borrow in any academic year (as defined in section 481(a)(2)) or its equivalent shall be the maximum an- nual amount for such student determined under sec- tion 428H, plus an amount equal to the amount of 49 The amendment made by section 2211(a)(1) of Public Law 111–152 to insert ‘‘, and first dis- bursed on June 30, 2010,’’ before ‘‘under sections 428’’ is subject to an effective date.
Subsection (b) of section 2211 of such Public Law provides: (b) EFFECTIVE DATE.—The amendment made by subsection (a)(1) shall apply with respect to loans first disbursed under part D of title IV of the Higher Education Act of 1965 (20 U.S.C.

1087a et seq.)

on or after July 1, 2010.

September 8, 2023 As Amended Through P.L.


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455 Federal Direct Stafford loans the student would have received in the absence of this subparagraph.
(B) EXCEPTION.—Subparagraph (A) shall not apply to an individual enrolled in course work specified in para- graph (3)(B) or (4)(B) of section 484(b).
(b) INTEREST RATE.— (1) RATES FOR FDSL AND FDUSL.—For Federal Direct Staf- ford Loans and Federal Direct Unsubsidized Stafford Loans for which the first disbursement is made on or after July 1, 1994, the applicable rate of interest shall, during any 12-month pe- riod beginning on July 1 and ending on June 30, be determined on the preceding June 1 and be equal to— (A) the bond equivalent rate of 91-day Treasury bills auctioned at the final auction held prior to such June 1; plus (B) 3.1 percent, except that such rate shall not exceed 8.25 percent.
(2) IN SCHOOL AND GRACE PERIOD RULES.—(A) Notwith- standing the provisions of paragraph (1), but subject to para- graph (3), with respect to any Federal Direct Stafford Loan or Federal Direct Unsubsidized Stafford Loan for which the first disbursement is made on or after July 1, 1995, the applicable rate of interest for interest which accrues— (i) prior to the beginning of the repayment period of the loan; or (ii) during the period in which principal need not be paid (whether or not such principal is in fact paid) by rea- son of a provision described in section 428(b)(1)(M) or 427(a)(2)(C), shall not exceed the rate determined under subparagraph (B).
(B) For the purpose of subparagraph (A), the rate deter- mined under this subparagraph shall, during any 12-month pe- riod beginning on July 1 and ending on June 30, be determined on the preceding June 1 and be equal to— (i) the bond equivalent rate of 91-day Treasury bills auctioned at the final auction prior to such June 1; plus (ii) 2.5 percent, except that such rate shall not exceed 8.25 percent.
(3) OUT-YEAR RULE.—Notwithstanding paragraphs (1) and (2), for Federal Direct Stafford Loans and Federal Direct Un- subsidized Stafford Loans made on or after July 1, 1998, the applicable rate of interest shall, during any 12-month period beginning on July 1 and ending on June 30, be determined on the preceding June 1 and be equal to— (A) the bond equivalent rate of the security with a comparable maturity as established by the Secretary; plus (B) 1.0 percent, except that such rate shall not exceed 8.25 percent.
(4) RATES FOR FDPLUS.— (A)(i) For Federal Direct PLUS Loans for which the first disbursement is made on or after July 1, 1994, the ap- plicable rate of interest shall, during any 12-month period beginning on July 1 and ending on or before June 30, September 8, 2023 As Amended Through P.L.

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455 HIGHER EDUCATION ACT OF 1965 486 2001, be determined on the preceding June 1 and be equal to— (I) the bond equivalent rate of 52-week Treasury bills auctioned at final auction held prior to such June 1; plus (II) 3.1 percent, except that such rate shall not exceed 9 percent.
(ii) For any 12-month period beginning on July 1 of 2001 or any succeeding year, the applicable rate of interest determined under this subparagraph shall be determined on the preceding June 26 and be equal to— (I) the weekly average 1-year constant maturity Treasury yield, as published by the Board of Gov- ernors of the Federal Reserve System, for the last cal- endar week ending on or before such June 26; plus (II) 3.1 percent, except that such rate shall not exceed 9 percent.
(B) For Federal Direct PLUS loans made on or after July 1, 1998, the applicable rate of interest shall, during any 12- month period beginning on July 1 and ending on June 30, be determined on the preceding June 1 and be equal to— (i) the bond equivalent rate of the security with a com- parable maturity as established by the Secretary; plus (ii) 2.1 percent, except that such rate shall not exceed 9 percent.
(5) TEMPORARY INTEREST RATE PROVISION.— (A) RATES FOR FDSL AND FDUSL.—Notwithstanding the preceding paragraphs of this subsection, for Federal Direct Stafford Loans and Federal Direct Unsubsidized Stafford Loans for which the first disbursement is made on or after July 1, 1998, and before October 1, 1998, the applicable rate of interest shall, during any 12-month period begin- ning on July 1 and ending on June 30, be determined on the preceding June 1 and be equal to— (i) the bond equivalent rate of 91-day Treasury bills auctioned at the final auction held prior to such June 1; plus (ii) 2.3 percent, except that such rate shall not exceed 8.25 percent.
(B) IN SCHOOL AND GRACE PERIOD RULES.—Notwith- standing the preceding paragraphs of this subsection, with respect to any Federal Direct Stafford Loan or Federal Di- rect Unsubsidized Stafford Loan for which the first dis- bursement is made on or after July 1, 1998, and before Oc- tober 1, 1998, the applicable rate of interest for interest which accrues— (i) prior to the beginning of the repayment period of the loan; or (ii) during the period in which principal need not be paid (whether or not such principal is in fact paid) by reason of a provision described in section 428(b)(1)(M) or 427(a)(2)(C), shall be determined under subparagraph (A) by sub- stituting ‘‘1.7 percent’’ for ‘‘2.3 percent’’.
September 8, 2023 As Amended Through P.L.

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455 (C) PLUS LOANS.—Notwithstanding the preceding paragraphs of this subsection, with respect to Federal Di- rect PLUS Loan for which the first disbursement is made on or after July 1, 1998, and before October 1, 1998, the applicable rate of interest shall be determined under sub- paragraph (A)— (i) by substituting ‘‘3.1 percent’’ for ‘‘2.3 percent’’; and (ii) by substituting ‘‘9.0 percent’’ for ‘‘8.25 percent’’.
(6) INTEREST RATE PROVISION FOR NEW LOANS ON OR AFTER OCTOBER 1, 1998, AND BEFORE JULY 1, 2006.— (A) RATES FOR FDSL AND FDUSL.—Notwithstanding the preceding paragraphs of this subsection, for Federal Direct Stafford Loans and Federal Direct Unsubsidized Stafford Loans for which the first disbursement is made on or after October 1, 1998, and before July 1, 2006, the applicable rate of interest shall, during any 12-month period begin- ning on July 1 and ending on June 30, be determined on the preceding June 1 and be equal to— (i) the bond equivalent rate of 91-day Treasury bills auctioned at the final auction held prior to such June 1; plus (ii) 2.3 percent, except that such rate shall not exceed 8.25 percent.
(B) IN SCHOOL AND GRACE PERIOD RULES.—Notwith- standing the preceding paragraphs of this subsection, with respect to any Federal Direct Stafford Loan or Federal Di- rect Unsubsidized Stafford Loan for which the first dis- bursement is made on or after October 1, 1998, and before July 1, 2006, the applicable rate of interest for interest which accrues— (i) prior to the beginning of the repayment period of the loan; or (ii) during the period in which principal need not be paid (whether or not such principal is in fact paid) by reason of a provision described in section 428(b)(1)(M) or 427(a)(2)(C), shall be determined under subparagraph (A) by sub- stituting ‘‘1.7 percent’’ for ‘‘2.3 percent’’.
(C) PLUS LOANS.—Notwithstanding the preceding paragraphs of this subsection, with respect to Federal Di- rect PLUS Loan for which the first disbursement is made on or after October 1, 1998, and before July 1, 2006, the applicable rate of interest shall be determined under sub- paragraph (A)— (i) by substituting ‘‘3.1 percent’’ for ‘‘2.3 percent’’; and (ii) by substituting ‘‘9.0 percent’’ for ‘‘8.25 percent’’.
(D) CONSOLIDATION LOANS.—Notwithstanding the pre- ceding paragraphs of this subsection, any Federal Direct Consolidation loan for which the application is received on or after February 1, 1999, and before July 1, 2006, shall bear interest at an annual rate on the unpaid principal balance of the loan that is equal to the lesser of— September 8, 2023 As Amended Through P.L.
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455 HIGHER EDUCATION ACT OF 1965 488 (i) the weighted average of the interest rates on the loans consolidated, rounded to the nearest higher one-eighth of one percent; or (ii) 8.25 percent.
(E) TEMPORARY RULES FOR CONSOLIDATION LOANS.— Notwithstanding the preceding paragraphs of this sub- section, any Federal Direct Consolidation loan for which the application is received on or after October 1, 1998, and before February 1, 1999, shall bear interest at an annual rate on the unpaid principal balance of the loan that is equal to— (i) the bond equivalent rate of 91-day Treasury bills auctioned at the final auction held prior to such June 1; plus (ii) 2.3 percent, except that such rate shall not exceed 8.25 percent.
(7) INTEREST RATE PROVISION FOR NEW LOANS ON OR AFTER JULY 1, 2006 AND BEFORE JULY 1, 2013.— (A) RATES FOR FDSL AND FDUSL.—Notwithstanding the preceding paragraphs of this subsection, for Federal Direct Stafford Loans and Federal Direct Unsubsidized Stafford Loans for which the first disbursement is made on or after July 1, 2006, and before July 1, 2013, the applicable rate of interest shall be 6.8 percent on the unpaid principal bal- ance of the loan.
(B) PLUS LOANS.—Notwithstanding the preceding paragraphs of this subsection, with respect to any Federal Direct PLUS loan for which the first disbursement is made on or after July 1, 2006, and before July 1, 2013, the appli- cable rate of interest shall be 7.9 percent on the unpaid principal balance of the loan.
(C) CONSOLIDATION LOANS.—Notwithstanding the pre- ceding paragraphs of this subsection, any Federal Direct Consolidation loan for which the application is received on or after July 1, 2006, and before July 1, 2013, shall bear interest at an annual rate on the unpaid principal balance of the loan that is equal to the lesser of— (i) the weighted average of the interest rates on the loans consolidated, rounded to the nearest higher one-eighth of one percent; or (ii) 8.25 percent.
(D) REDUCED RATES FOR UNDERGRADUATE FDSL.—Not- withstanding the preceding paragraphs of this subsection and subparagraph (A) of this paragraph, for Federal Direct Stafford Loans made to undergraduate students for which the first disbursement is made on or after July 1, 2006, and before July 1, 2013, the applicable rate of interest shall be as follows: (i) For a loan for which the first disbursement is made on or after July 1, 2006, and before July 1, 2008, 6.8 percent on the unpaid principal balance of the loan.
(ii) For a loan for which the first disbursement is made on or after July 1, 2008, and before July 1, 2009, September 8, 2023 As Amended Through P.L.

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455 6.0 percent on the unpaid principal balance of the loan.
(iii) For a loan for which the first disbursement is made on or after July 1, 2009, and before July 1, 2010, 5.6 percent on the unpaid principal balance of the loan.

(iv) For a loan for which the first disbursement is made on or after July 1, 2010, and before July 1, 2011, 4.5 percent on the unpaid principal balance of the loan.

(v) For a loan for which the first disbursement is made on or after July 1, 2011, and before July 1, 2013, 3.4 percent on the unpaid principal balance of the loan.
(8) INTEREST RATE PROVISIONS FOR NEW LOANS ON OR AFTER JULY 1, 2013.— (A) RATES FOR UNDERGRADUATE FDSL AND FDUSL.— Notwithstanding the preceding paragraphs of this sub- section, for Federal Direct Stafford Loans and Federal Di- rect Unsubsidized Stafford Loans issued to undergraduate students, for which the first disbursement is made on or after July 1, 2013, the applicable rate of interest shall, for loans disbursed during any 12-month period beginning on July 1 and ending on June 30, be determined on the pre- ceding June 1 and be equal to the lesser of— (i) a rate equal to the high yield of the 10-year Treasury note auctioned at the final auction held prior to such June 1 plus 2.05 percent; or (ii) 8.25 percent.
(B) RATES FOR GRADUATE AND PROFESSIONAL FDUSL.— Notwithstanding the preceding paragraphs of this sub- section, for Federal Direct Unsubsidized Stafford Loans issued to graduate or professional students, for which the first disbursement is made on or after July 1, 2013, the ap- plicable rate of interest shall, for loans disbursed during any 12-month period beginning on July 1 and ending on June 30, be determined on the preceding June 1 and be equal to the lesser of— (i) a rate equal to the high yield of the 10-year Treasury note auctioned at the final auction held prior to such June 1 plus 3.6 percent; or (ii) 9.5 percent.
(C) PLUS LOANS.—Notwithstanding the preceding paragraphs of this subsection, for Federal Direct PLUS Loans, for which the first disbursement is made on or after July 1, 2013, the applicable rate of interest shall, for loans disbursed during any 12-month period beginning on July 1 and ending on June 30, be determined on the preceding June 1 and be equal to the lesser of— (i) a rate equal to the high yield of the 10-year Treasury note auctioned at the final auction held prior to such June 1 plus 4.6 percent; or (ii) 10.5 percent.
September 8, 2023 As Amended Through P.L.

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455 HIGHER EDUCATION ACT OF 1965 490 (D) CONSOLIDATION LOANS.—Notwithstanding the pre- ceding paragraphs of this subsection, any Federal Direct Consolidation Loan for which the application is received on or after July 1, 2013, shall bear interest at an annual rate on the unpaid principal balance of the loan that is equal to the weighted average of the interest rates on the loans consolidated, rounded to the nearest higher one-eighth of one percent.
(E) CONSULTATION.—The Secretary shall determine the applicable rate of interest under this paragraph after consultation with the Secretary of the Treasury and shall publish such rate in the Federal Register as soon as prac- ticable after the date of determination.

(F) RATE.—The applicable rate of interest determined under this paragraph for a Federal Direct Stafford Loan, a Federal Direct Unsubsidized Stafford Loan, or a Federal Direct PLUS Loan shall be fixed for the period of the loan.
(9) REPAYMENT INCENTIVES.— (A)(A) 50 INCENTIVES FOR LOANS DISBURSED BEFORE JULY 1, 2012.—Notwithstanding any other provision of this part with respect to loans for which the first disbursement of principal is made before July 1, 2012,, 51 the Secretary is authorized to prescribe by regulation such reductions in the interest or origination fee rate paid by a borrower of a loan made under this part as the Secretary determines appropriate to encourage on-time repayment of the loan.
Such reductions may be offered only if the Secretary deter- mines the reductions are cost neutral and in the best fi- nancial interest of the Federal Government.

Any increase in subsidy costs resulting from such reductions shall be completely offset by corresponding savings in funds avail- able for the William D. Ford Federal Direct Loan Program in that fiscal year from section 458 and other administra- tive accounts.
(B) ACCOUNTABILITY.—Prior to publishing regulations proposing repayment incentives with respect to loans for which the first disbursement of principal is made before July 1, 2012, the Secretary shall ensure the cost neutrality of such reductions.
The Secretary shall not prescribe such regulations in final form unless an official report from the Director of the Office of Management and Budget to the Secretary and a comparable report from the Director of the Congressional Budget Office to the Congress each certify that any such reductions will be completely cost neutral.

Such reports shall be transmitted to the authorizing com- mittees not less than 60 days prior to the publication of regulations proposing such reductions.
(C) NO REPAYMENT INCENTIVES FOR NEW LOANS DIS- BURSED ON OR AFTER JULY 1, 2012.—Notwithstanding any other provision of this part, the Secretary is prohibited 50 So in law.

See amendment made by section 503(1)(A) of Public Law 112–25.

The amend- ment revises the heading in its entirety and probably should not have included the subpara- graph designator in the matter to be inserted since that is not part of the heading.

51 Two commas so in law.

See amendment made by section 503(1)(B) of Public Law 112–25.
September 8, 2023 As Amended Through P.L.

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455 from authorizing or providing any repayment incentive not otherwise authorized under this part to encourage on-time repayment of a loan under this part for which the first dis- bursement of principal is made on or after July 1, 2012, including any reduction in the interest or origination fee rate paid by a borrower of such a loan, except that the Sec- retary may provide for an interest rate reduction for a bor- rower who agrees to have payments on such a loan auto- matically electronically debited from a bank account.
(10) PUBLICATION.—The Secretary shall determine the ap- plicable rates of interest under this subsection after consulta- tion with the Secretary of the Treasury and shall publish such rate in the Federal Register as soon as practicable after the date of determination.

(c) LOAN FEE.— (1) IN GENERAL.—The Secretary shall charge the borrower of a loan made under this part an origination fee of 4.0 percent of the principal amount of loan.
(2) SUBSEQUENT REDUCTION.—Paragraph (1) shall be ap- plied to loans made under this part, other than Federal Direct Consolidation loans and Federal Direct PLUS loans— (A) by substituting ‘‘3.0 percent’’ for ‘‘4.0 percent’’ with respect to loans for which the first disbursement of prin- cipal is made on or after the date of enactment of the Higher Education Reconciliation Act of 2005, and before July 1, 2007; (B) by substituting ‘‘2.5 percent’’ for ‘‘4.0 percent’’ with respect to loans for which the first disbursement of prin- cipal is made on or after July 1, 2007, and before July 1, 2008; (C) by substituting ‘‘2.0 percent’’ for ‘‘4.0 percent’’ with respect to loans for which the first disbursement of prin- cipal is made on or after July 1, 2008, and before July 1, 2009; (D) by substituting ‘‘1.5 percent’’ for ‘‘4.0 percent’’ with respect to loans for which the first disbursement of prin- cipal is made on or after July 1, 2009, and before July 1, 2010; and (E) by substituting ‘‘1.0 percent’’ for ‘‘4.0 percent’’ with respect to loans for which the first disbursement of prin- cipal is made on or after July 1, 2010.
(d) REPAYMENT PLANS.— (1) DESIGN AND SELECTION.—Consistent with criteria es- tablished by the Secretary, the Secretary shall offer a borrower of a loan made under this part a variety of plans for repayment of such loan, including principal and interest on the loan.

The borrower shall be entitled to accelerate, without penalty, re- payment on the borrower’s loans under this part.
The borrower may choose— (A) a standard repayment plan, consistent with sub- section section and with this of section (a)(1) 428(b)(9)(A)(i); September 8, 2023 As Amended Through P.L.

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455 HIGHER EDUCATION ACT OF 1965 492 (C) an extended repayment plan, consistent with sec- tion 428(b)(9)(A)(iv), except that the borrower shall annu- ally repay a minimum amount determined by the Sec- retary in accordance with section 428(b)(1)(L); (D) an income contingent repayment plan, with vary- ing annual repayment amounts based on the income of the borrower, paid over an extended period of time prescribed by the Secretary, not to exceed 25 years, except that the plan described in this subparagraph shall not be available to the borrower of a Federal Direct PLUS loan made on be- half of a dependent student; and (E) beginning on July 1, 2009, an income-based repay- ment plan that enables borrowers who have a partial fi- nancial hardship to make a lower monthly payment in ac- cordance with section 493C, except that the plan described in this subparagraph shall not be available to the borrower of a Federal Direct PLUS Loan made on behalf of a de- pendent student or a Federal Direct Consolidation Loan, if the proceeds of such loan were used to discharge the liabil- ity on such Federal Direct PLUS Loan or a loan under sec- tion 428B made on behalf of a dependent student.
(2) SELECTION BY SECRETARY.—If a borrower of a loan made under this part does not select a repayment plan de- scribed in paragraph (1), the Secretary may provide the bor- rower with a repayment plan described in subparagraph (A), (B), or (C) of paragraph (1).
(3) CHANGES IN SELECTIONS.—The borrower of a loan made under this part may change the borrower’s selection of a repay- ment plan under paragraph (1), or the Secretary’s selection of a plan for the borrower under paragraph (2), as the case may be, under such terms and conditions as may be established by the Secretary.
(4) ALTERNATIVE REPAYMENT PLANS.—The Secretary may provide, on a case by case basis, an alternative repayment plan to a borrower of a loan made under this part who demonstrates to the satisfaction of the Secretary that the terms and condi- tions of the repayment plans available under paragraph (1) are not adequate to accommodate the borrower’s exceptional cir- cumstances.
In designing such alternative repayment plans, the Secretary shall ensure that such plans do not exceed the cost to the Federal Government, as determined on the basis of the present value of future payments by such borrowers, of loans made using the plans available under paragraph (1).
(5) REPAYMENT AFTER DEFAULT.—The Secretary may re- quire any borrower who has defaulted on a loan made under this part to— (A) pay all reasonable collection costs associated with such loan; and (B) repay the loan pursuant to an income contingent repayment plan.
(e) INCOME CONTINGENT REPAYMENT.— (1) INFORMATION AND PROCEDURES.—The Secretary may obtain such information as is reasonably necessary regarding the income of a borrower (and the borrower’s spouse, if applica- September 8, 2023 As Amended Through P.L.

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455 ble) of a loan made under this part that is, or may be, repaid pursuant to income contingent repayment, for the purpose of determining the annual repayment obligation of the borrower.

Returns and return information (as defined in section 6103 of the Internal Revenue Code of 1986) may be obtained under the preceding sentence only to the extent authorized by section 6103(l)(13) of such Code.
The Secretary shall establish proce- dures for determining the borrower’s repayment obligation on that loan for such year, and such other procedures as are nec- essary to implement effectively income contingent repayment.
(2) REPAYMENT BASED ON ADJUSTED GROSS INCOME.—A re- payment schedule for a loan made under this part and repaid pursuant to income contingent repayment shall be based on the adjusted gross income (as defined in section 62 of the Inter- nal Revenue Code of 1986) of the borrower or, if the borrower is married and files a Federal income tax return jointly with the borrower’s spouse, on the adjusted gross income of the bor- rower and the borrower’s spouse.
(3) ADDITIONAL DOCUMENTS.—A borrower who chooses, or is required, to repay a loan made under this part pursuant to income contingent repayment, and for whom adjusted gross in- come is unavailable or does not reasonably reflect the bor- rower’s current income, shall provide to the Secretary other documentation of income satisfactory to the Secretary, which documentation the Secretary may use to determine an appro- priate repayment schedule.
(4) REPAYMENT SCHEDULES.—Income contingent repayment schedules shall be established by regulations promulgated by the Secretary and shall require payments that vary in relation to the appropriate portion of the annual income of the borrower (and the borrower’s spouse, if applicable) as determined by the Secretary.
(5) CALCULATION OF BALANCE DUE.—The balance due on a loan made under this part that is repaid pursuant to income contingent repayment shall equal the unpaid principal amount of the loan, any accrued interest, and any fees, such as late charges, assessed on such loan.

The Secretary may promulgate regulations limiting the amount of interest that may be cap- italized on such loan, and the timing of any such capitalization.
(6) NOTIFICATION TO BORROWERS.—The Secretary shall es- tablish procedures under which a borrower of a loan made under this part who chooses or is required to repay such loan pursuant to income contingent repayment is notified of the terms and conditions of such plan, considers that special cir- cumstances, such as a loss of employment by the borrower or the borrower’s spouse, warrant an adjustment in the bor- rower’s loan repayment, the borrower may contact the Sec- retary, who shall determine whether such adjustment is appro- priate, in accordance with criteria established by the Secretary.
(7) MAXIMUM REPAYMENT PERIOD.—In calculating the ex- tended period of time for which an income contingent repay- ment plan under this subsection may be in effect for a bor- rower, the Secretary shall include all time periods during which a borrower of loans under part B, part D, or part E— September 8, 2023 As Amended Through P.L.
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455 HIGHER EDUCATION ACT OF 1965 494 (A) is not in default on any loan that is included in the income contingent repayment plan; and (B)(i) is in deferment due to an economic hardship de- scribed in section 435(o); (6) of section 493C(b); (ii) makes monthly payments under paragraph (1) or (iii) makes monthly payments of not less than the monthly amount calculated under section 428(b)(9)(A)(i) or subsection (d)(1)(A), based on a 10-year repayment period, when the borrower first made the election described in sec- tion 493C(b)(1); (iv) makes payments of not less than the payments re- quired under a standard repayment plan under section 428(b)(9)(A)(i) or subsection (d)(1)(A) with a repayment pe- riod of 10 years; or (v) makes payments under an income contingent re- payment plan under subsection (d)(1)(D).
(8) AUTOMATIC RECERTIFICATION.— (A) IN GENERAL.—The Secretary shall establish and implement, with respect to any borrower described in sub- paragraph (B), procedures to— (i) use return information disclosed under section 6103(l)(13) of the Internal Revenue Code of 1986, pur- suant to approval provided under section 494, to deter- mine the repayment obligation of the borrower with- out further action by the borrower; (ii) allow the borrower (or the spouse of the bor- rower), at any time, to opt out of disclosure under such section 6103(l)(13) and instead provide such informa- tion as the Secretary may require to determine the re- payment obligation of the borrower (or withdraw from the repayment plan under this subsection); and (iii) provide the borrower with an opportunity to update the return information so disclosed before the determination of the repayment obligation of the bor- rower.
(B) APPLICABILITY.—Subparagraph (A) shall apply to each borrower of a loan made under this part who, on or after the date on which the Secretary establishes proce- dures under such subparagraph— (i) selects, or is required to repay such loan pursu- ant to, an income-contingent repayment plan; or (ii) recertifies income or family size under such plan.
(f) DEFERMENT.— (1) EFFECT ON PRINCIPAL AND INTEREST.—A borrower of a loan made under this part who meets the requirements de- scribed in paragraph (2) shall be eligible for a deferment, dur- ing which periodic installments of principal need not be paid, and interest— (A) shall not accrue, in the case of a— (i) Federal Direct Stafford Loan; or (ii) a Federal Direct Consolidation Loan that con- solidated only Federal Direct Stafford Loans, or a com- September 8, 2023 As Amended Through P.L.
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455 bination of such loans and Federal Stafford Loans for which the student borrower received an interest sub- sidy under section 428; or (B) shall accrue and be capitalized or paid by the bor- rower, in the case of a Federal Direct PLUS Loan, a Fed- eral Direct Unsubsidized Stafford Loan, or a Federal Di- rect Consolidation Loan not described in subparagraph (A)(ii).
(2) ELIGIBILITY.—A borrower of a loan made under this part shall be eligible for a deferment during any period— (A) during which the borrower— (i) is carrying at least one-half the normal full- time work load for the course of study that the bor- rower is pursuing, as determined by the eligible insti- tution (as such term is defined in section 435(a)) the borrower is attending; or (ii) is pursuing a course of study pursuant to a graduate fellowship program approved by the Sec- retary, or pursuant to a rehabilitation training pro- gram for individuals with disabilities approved by the Secretary, except that no borrower shall be eligible for a deferment under this subparagraph, or a loan made under this part (other than a Federal Direct PLUS Loan or a Federal Di- rect Consolidation Loan), while serving in a medical in- ternship or residency program; (B) not in excess of 3 years during which the borrower is seeking and unable to find full-time employment; (C) during which the borrower— (i) is serving on active duty during a war or other military operation or national emergency; or (ii) is performing qualifying National Guard duty during a war or other military operation or national emergency, and for the 180-day period following the demobilization date for the service described in clause (i) or (ii); or (D) not in excess of 3 years during which the Secretary determines, in accordance with regulations prescribed under section 435(o), that the borrower has experienced or will experience an economic hardship.
(3) DEFERMENT FOR BORROWERS RECEIVING CANCER TREAT- MENT.— (A) EFFECT ON PRINCIPAL AND INTEREST.—A borrower of a loan made under this part who meets the require- ments of subparagraph for a deferment, during which periodic installments of principal need not be paid, and interest shall not accrue.
(B) shall be eligible (B) ELIGIBILITY.—A borrower of a loan made under this part shall be eligible for a deferment during— (i) any period in which such borrower is receiving treatment for cancer; and (ii) the 6 months after such period.

(C) APPLICABILITY.—This paragraph shall apply with respect to loans— September 8, 2023 As Amended Through P.L.
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455 HIGHER EDUCATION ACT OF 1965 496 (i) made on or after the date of the enactment of (ii) in repayment on the date of the enactment of this paragraph; or this paragraph.
(4) DEFINITION OF BORROWER.—For the purpose of this subsection, the term ‘‘borrower’’ means an individual who is a new borrower on the date such individual applies for a loan under this part for which the first disbursement is made on or after July 1, 1993.
(5) DEFERMENTS FOR PREVIOUS PART B LOAN BORROWERS.— A borrower of a loan made under this part, who at the time such individual applies for such loan, has an outstanding bal- ance of principal or interest owing on any loan made, insured, or guaranteed under part B of title IV prior to July 1, 1993, shall be eligible for a deferment under section 427(a)(2)(C) or section 428(b)(1)(M) as such sections were in effect on July 22, 1992.
(g) FEDERAL DIRECT CONSOLIDATION LOANS.— (1) IN GENERAL.—A borrower of a loan made under this part may consolidate such loan with the loans described in sec- tion 428C(a)(4), including any loan made under part B and first disbursed before July 1, 2010.

To be eligible for a consoli- dation loan under this part, a borrower shall meet the eligi- bility criteria set forth in section 428C(a)(3).
(2) SEPARATING JOINT CONSOLIDATION LOANS.— (A) IN GENERAL.— (i) AUTHORIZATION.—A married couple, or 2 indi- viduals who were previously a married couple, and who received a joint consolidation loan as such mar- ried couple under subparagraph (C) of section 428C(a)(3) (as such subparagraph was in effect on June 30, 2006), may apply to the Secretary, in accord- ance with subparagraph (C) of this paragraph, for each individual borrower in the married couple (or previously married couple) to receive a separate Fed- eral Direct Consolidation Loan under this part.
(ii) ELIGIBILITY FOR BORROWERS IN DEFAULT.— Notwithstanding any other provision of this Act, a married couple, or 2 individuals who were previously a married couple, who are in default on a joint consoli- dation loan may be eligible to receive a separate Fed- eral Direct Consolidation Loan under this part in ac- cordance with this paragraph.
(B) SECRETARIAL REQUIREMENTS.—Notwithstanding section 428C(a)(3)(A) or any other provision of law, for each individual borrower who applies under subparagraph (A), the Secretary shall— (i) make a separate Federal Direct Consolidation Loan under this part that— (I) shall be for an amount equal to the prod- uct of— (aa) the unpaid principal and accrued un- paid interest of the joint consolidation loan (as of the date that is the day before such sep- September 8, 2023 As Amended Through P.L.
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455 arate consolidation loan is made) and any out- standing charges and fees with respect to such loan; and (bb) the percentage of the joint consolida- tion loan attributable to the loans of the indi- vidual borrower for whom such separate con- solidation loan is being made, as deter- mined— (AA) on the basis of the loan obliga- tions of such borrower with respect to such joint consolidation loan (as of the date such joint consolidation loan was made); or (BB) in the case in which both bor- rowers request, on the basis of propor- tions outlined in a divorce decree, court order, or settlement agreement; and (II) has the same rate of interest as the joint consolidation loan (as of the date that is the day before such separate consolidation loan is made); and (ii) in a timely manner, notify each individual bor- rower that the joint consolidation loan had been re- paid and of the terms and conditions of their new loans.
(C) APPLICATION FOR SEPARATE DIRECT CONSOLIDATION LOAN.— (i) JOINT APPLICATION.—Except as provided in clause (ii), to receive separate consolidation loans under this part, both individual borrowers in a mar- ried couple (or previously married couple) shall jointly apply under subparagraph (A).
(ii) SEPARATE APPLICATION.—An individual bor- rower in a married couple (or previously married cou- ple) may apply for a separate consolidation loan under subparagraph (A) separately and without regard to whether or when the other individual borrower in the married couple (or previously married couple) applies under subparagraph (A), in a case in which— (I) the individual borrower certifies to the Sec- retary that such borrower— (aa) has experienced an act of domestic violence (as defined in section 40002 of the Vi- olence Against Women Act of 1994 (34 U.S.C.
12291) from the other individual borrower; (bb) has experienced economic abuse (as defined in section 40002 of the Violence Against Women Act of 1994 (34 U.S.C.

12291) from the other individual borrower; or (cc) is unable to reasonably reach or ac- cess the loan information of the other indi- vidual borrower; or (II) the Secretary determines that authorizing each individual borrower to apply separately September 8, 2023 As Amended Through P.L.
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455 HIGHER EDUCATION ACT OF 1965 498 under subparagraph (A) would be in the best fis- cal interests of the Federal Government.
(iii) REMAINING OBLIGATION FROM SEPARATE APPLI- CATION.—In the case of an individual borrower who re- ceives a separate consolidation loan due to the cir- cumstances described in clause (ii), the other non-ap- plying individual borrower shall become solely liable for the remaining balance of the joint consolidation loan.
(h) BORROWER DEFENSES.—Notwithstanding any other provi- sion of State or Federal law, the Secretary shall specify in regula- tions which acts or omissions of an institution of higher education a borrower may assert as a defense to repayment of a loan made under this part, except that in no event may a borrower recover from the Secretary, in any action arising from or relating to a loan made under this part, an amount in excess of the amount such bor- rower has repaid on such loan.
(i) LOAN APPLICATION AND PROMISSORY NOTE.—The common fi- nancial reporting form required in section 483(a)(1) shall constitute the application for loans made under this part (other than a Fed- eral Direct PLUS loan).

The Secretary shall develop, print, and dis- tribute to participating institutions a standard promissory note and loan disclosure form.
(j) LOAN DISBURSEMENT.— (1) IN GENERAL.—Proceeds of loans to students under this part shall be applied to the student’s account for tuition and fees, and, in the case of institutionally owned housing, to room and board.

Loan proceeds that remain after the application of the previous sentence shall be delivered to the borrower by check or other means that is payable to and requires the en- dorsement or other certification by such borrower.
(2) PAYMENT PERIODS.—The Secretary shall establish peri- ods for the payments described in paragraph (1) in a manner consistent with payment of Federal Pell Grants under subpart 1 of part A of this title.

(k) FISCAL CONTROL AND FUND ACCOUNTABILITY.— (1) IN GENERAL.—(A) An institution shall maintain finan- cial records in a manner consistent with records maintained for other programs under this title.
(B) Except as otherwise required by regulations of the Sec- retary 52 an institution may maintain loan funds under this part in the same account as other Federal student financial as- sistance.
(2) PAYMENTS AND REFUNDS.—Payments and refunds shall be reconciled in a manner consistent with the manner set forth for the submission of a payment summary report required of institutions participating in the program under subpart 1 of part A, except that nothing in this paragraph shall prevent such reconciliations on a monthly basis.

(3) TRANSACTION HISTORIES.—All transaction histories under this part shall be maintained using the same system September 8, 2023 As Amended Through P.L.
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Probably should read ‘‘Secretary,’’.

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455 designated by the Secretary for the provision of Federal Pell Grants under subpart 1 of part A of this title.
(l) ARMED FORCES AND NOAA COMMISSIONED OFFICER CORPS STUDENT LOAN INTEREST PAYMENT PROGRAMS.— (1) AUTHORITY.—Using funds received by transfer to the Secretary under section 2174 of title 10, United States Code, or section 268 of the National Oceanic and Atmospheric Ad- ministration Commissioned Officer Corps Act of 2002 for the payment of interest on a loan made under this part to a mem- ber of the Armed Forces or an officer in the commissioned offi- cer corps of the National Oceanic and Atmospheric Administra- tion, respectively, the Secretary shall pay the interest on the loan as due for a period not in excess of 36 consecutive months.
The Secretary may not pay interest on such a loan out of any funds other than funds that have been so transferred.

(2) FORBEARANCE.—During the period in which the Sec- retary is making payments on a loan under paragraph (1), the Secretary shall grant the borrower forbearance, in the form of a temporary cessation of all payments on the loan other than the payments of interest on the loan that are made under that paragraph.
(m) REPAYMENT PLAN FOR PUBLIC SERVICE EMPLOYEES.— (1) IN GENERAL.—The Secretary shall cancel the balance of interest and principal due, in accordance with paragraph (2), on any eligible Federal Direct Loan not in default for a bor- rower who— (A) has made 120 monthly payments on the eligible Federal Direct Loan after October 1, 2007, pursuant to any one or a combination of the following— (i) payments under an income-based repayment plan under section 493C; (ii) payments under a standard repayment plan under subsection (d)(1)(A), based on a 10-year repay- ment period; (iii) monthly payments under a repayment plan under subsection (d)(1) or (g) of not less than the monthly amount calculated under subsection (d)(1)(A), based on a 10-year repayment period; or (iv) payments under an income contingent repay- ment plan under subsection (d)(1)(D); and (B)(i) is employed in a public service job at the time of such forgiveness; and (ii) has been employed in a public service job during the period in which the borrower makes each of the 120 payments described in subparagraph (A).
(2) LOAN CANCELLATION AMOUNT.—After the conclusion of the employment period described in paragraph (1), the Sec- retary shall cancel the obligation to repay the balance of prin- cipal and interest due as of the time of such cancellation, on the eligible Federal Direct Loans made to the borrower under this part.

(3) DEFINITIONS.—In this subsection: (A) ELIGIBLE FEDERAL DIRECT LOAN.—The term ‘‘eligi- ble Federal Direct Loan’’ means a Federal Direct Stafford September 8, 2023 As Amended Through P.L.
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455 HIGHER EDUCATION ACT OF 1965 500 Loan, Federal Direct PLUS Loan, or Federal Direct Un- subsidized Stafford Loan, or a Federal Direct Consolida- tion Loan.
(B) PUBLIC SERVICE JOB.—The term ‘‘public service job’’ means— (i) a full-time job in emergency management, gov- ernment (excluding time served as a member of Con- gress), military service, public safety, law enforcement, public health (including nurses, nurse practitioners, nurses in a clinical setting, and full-time professionals engaged in health care practitioner occupations and health care support occupations, as such terms are de- fined by the Bureau of Labor Statistics), public edu- cation, social work in a public child or family service agency, public interest law services (including prosecu- tion or public defense or legal advocacy on behalf of low-income communities at a nonprofit organization), early childhood education (including licensed or regu- lated childcare, Head Start, and State funded pre- kindergarten), public service for individuals with dis- abilities, public service for the elderly, public library sciences, school-based library sciences and other school-based services, or at an organization that is de- scribed in section 501(c)(3) of the Internal Revenue Code of 1986 and exempt from taxation under section 501(a) of such Code; or (ii) teaching as a full-time faculty member at a Tribal College or University as defined in section 316(b) and other faculty teaching in high-needs subject areas or areas of shortage (including nurse faculty, foreign language faculty, and part-time faculty at com- munity colleges), as determined by the Secretary.
(4) INELIGIBILITY FOR DOUBLE BENEFITS.—No borrower may, for the same service, receive a reduction of loan obliga- tions under both this subsection and section 428J, 428K, 428L, or 460.

(n) IDENTITY FRAUD PROTECTION.—The Secretary shall take such steps as may be necessary to ensure that monthly Federal Di- rect Loan statements and other publications of the Department do not contain more than four digits of the Social Security number of any individual.
(o) NO ACCRUAL OF INTEREST FOR ACTIVE DUTY SERVICE MEM- BERS.— (1) IN GENERAL.—Notwithstanding any other provision of this part and in accordance with paragraphs (2) and (4), inter- est shall not accrue for an eligible military borrower on a loan made under this part for which the first disbursement is made on or after October 1, 2008.
(2) CONSOLIDATION LOANS.—In the case of any consolida- tion loan made under this part that is disbursed on or after October 1, 2008, interest shall not accrue pursuant to this sub- section only on such portion of such loan as was used to repay a loan made under this part for which the first disbursement is made on or after October 1, 2008.

September 8, 2023 As Amended Through P.L.


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456 (3) ELIGIBLE MILITARY BORROWER.—In this subsection, the term ‘‘eligible military borrower’’ means an individual who— (A)(i) is serving on active duty during a war or other military operation or national emergency; or (ii) is performing qualifying National Guard duty dur- ing a war or other military operation or national emer- gency; and (B) is serving in an area of hostilities in which service qualifies for special pay under section 310, or paragraph (1) or (3) of section 351(a), of title 37, United States Code.
(4) LIMITATION.—An individual who qualifies as an eligible military borrower under this subsection may receive the ben- efit of this subsection for not more than 60 months.
(p) DISCLOSURES.—Each institution of higher education with which the Secretary has an agreement under section 453, and each contractor with which the Secretary has a contract under section 456, shall, with respect to loans under this part and in accordance with such regulations as the Secretary shall prescribe, comply with each of the requirements under section 433 that apply to a lender with respect to a loan under part B. SEC.

456. ø20 U.S.C.

1087f¿ CONTRACTS.


(a) CONTRACTS FOR SUPPLIES AND SERVICES.— (1) IN GENERAL.—The Secretary shall, to the extent prac- ticable, award contracts for origination, servicing, and collec- tion described in subsection (b).

In awarding such contracts, the Secretary shall ensure that such services and supplies are provided at competitive prices.
(2) ENTITIES.—The entities with which the Secretary may enter into contracts shall include only entities which the Sec- retary determines are qualified to provide such services and supplies and will comply with the procedures applicable to the award of such contracts.

In the case of awarding contracts for the origination, servicing, and collection of loans under this part, the Secretary shall enter into contracts only with entities that have extensive and relevant experience and demonstrated effectiveness.
The entities with which the Secretary may enter into such contracts shall include, where practicable, agencies with agreements with the Secretary under sections 428(b) and (c), if such agencies meet the qualifications as determined by the Secretary under this subsection and if those agencies have such experience and demonstrated effectiveness.
In awarding contracts to such State agencies, the Secretary shall, to the ex- tent practicable and consistent with the purposes of this part, give special consideration to State agencies with a history of high quality performance to perform services for institutions of higher education within their State.
(3) RULE OF CONSTRUCTION.—Nothing in this section shall be construed as a limitation of the authority of any State agen- cy to enter into an agreement for the purposes of this section as a member of a consortium of State agencies.

(b) CONTRACTS FOR ORIGINATION, SERVICING, AND DATA SYS- September 8, 2023 As Amended Through P.L.
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458 HIGHER EDUCATION ACT OF 1965 502 (1) the alternative origination of loans to students attend- ing institutions of higher education with agreements to partici- pate in the program under this part (or their parents), if such institutions do not have agreements with the Secretary under section 454(b); (2) the servicing and collection of loans made or purchased under this part; (3) the establishment and operation of 1 or more data sys- tems for the maintenance of records on all loans made or pur- chased under this part; and (4) such other aspects of the direct student loan program as the Secretary determines are necessary to ensure the suc- cessful operation of the program.
øSection 457 repealed by section 404(b)(3) of P.L.

111–39¿ SEC.

458. ø20 U.S.C.

1087h¿ FUNDS FOR ADMINISTRATIVE EXPENSES.
(a) ADMINISTRATIVE EXPENSES.— (1) MANDATORY FUNDS FOR FISCAL YEAR 2006.—For fiscal year 2006, there shall be available to the Secretary, from funds not otherwise appropriated, funds to be obligated for— (A) administrative costs under this part and part B, including the costs of the direct student loan programs under this part; and (B) account maintenance fees payable to guaranty agencies under part B and calculated in accordance with subsections (b) and (c), not to exceed (from such funds not otherwise appropriated) $820,000,000 in fiscal year 2006.
(2) øRepealed by section 502(2) of division A of H.J.

Res.

59.¿ (3) AUTHORIZATION FOR ADMINISTRATIVE COSTS BEGINNING IN FISCAL YEARS 2007 THROUGH 2014.—For each of the fiscal years 2007 through 2014, there are authorized to be appro- priated such sums as may be necessary for administrative costs under this part and part B, including the costs of the di- rect student loan programs under this part.
(4) CONTINUING MANDATORY FUNDS FOR ACCOUNT MAINTE- NANCE FEES.—For each of the fiscal years 2007 through 2021, there shall be available to the Secretary, from funds not other- wise appropriated, funds to be obligated for account mainte- nance fees payable to guaranty agencies under part B and cal- culated in accordance with subsection (b).
(5) ACCOUNT MAINTENANCE FEES.—Account maintenance fees under paragraph (3) shall be paid quarterly and deposited in the Agency Operating Fund established under section 422B.

(6) TECHNICAL ASSISTANCE TO INSTITUTIONS OF HIGHER EDUCATION.— (A) PROVISION OF ASSISTANCE.—The Secretary shall provide institutions of higher education participating, or seeking to participate, in the loan programs under this part with technical assistance in establishing and admin- istering such programs.
(B) FUNDS.—There are authorized to be appropriated, and there are appropriated, to carry out this paragraph (in September 8, 2023 As Amended Through P.L.

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459A addition to any other amounts appropriated to carry out this paragraph and out of any money in the Treasury not otherwise appropriated), $50,000,000 for fiscal year 2010.

(C) DEFINITION.—In this paragraph, the term ‘‘assist- ance’’ means the provision of technical support, training, materials, technical assistance, and financial assistance.
(7) ADDITIONAL PAYMENTS.— (A) PROVISION OF ASSISTANCE.—The Secretary shall provide payments to loan servicers for retaining jobs at lo- cations in the United States where such servicers were op- erating under part B on January 1, 2010.
(B) FUNDS.—There are authorized to be appropriated, and there are appropriated, to carry out this paragraph (in addition to any other amounts appropriated to carry out this paragraph and out of any money in the Treasury not otherwise appropriated), $25,000,000 for each of the fiscal years 2010 and 2011.

(8) CARRYOVER.—The Secretary may carry over funds made available under this section to a subsequent fiscal year.
(b) CALCULATION BASIS.—Account maintenance fees payable to guaranty agencies under subsection (a)(4) shall be calculated on the basis of 0.06 percent of the original principal amount of out- standing loans on which insurance was issued under part B.
(c) BUDGET JUSTIFICATION.—No funds may be expended under this section unless the Secretary includes in the Department of Education’s annual budget justification to Congress a detailed de- scription of the specific activities for which the funds made avail- able by this section have been used in the prior and current years (if applicable), the activities and costs planned for the budget year, and the projection of activities and costs for each remaining year for which administrative expenses under this section are made available.
SEC.

459. ø20 U.S.C.

1087i¿ AUTHORITY TO SELL LOANS.

The Secretary, in consultation with the Secretary of the Treas- ury, is authorized to sell loans made under this part on such terms as the Secretary determines are in the best interest of the United States, except that any such sale shall not result in any cost to the Federal Government.
Notwithstanding any other provision of law, the proceeds of any such sale may be used by the Secretary to offer reductions in the interest rate paid by a borrower of a loan made under this part as the Secretary determines appropriate to encour- age on-time repayment in accordance with section 455(b)(7).

Such reductions may be offered only if the Secretary determines the re- ductions are in the best financial interests of the Federal Govern- ment.

SEC.

459A.

ø20 U.S.C.


1087i–1¿ TEMPORARY AUTHORITY TO PURCHASE STUDENT LOANS.

(a) AUTHORITY TO PURCHASE.— (1) AUTHORITY; DETERMINATION REQUIRED.—Upon a deter- mination by the Secretary that there is an inadequate avail- ability of loan capital to meet the demand for loans under sec- tions 428, 428B, or 428H, whether as a result of inadequate li- quidity for such loans or for other reasons, the Secretary, in September 8, 2023 As Amended Through P.L.
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459A HIGHER EDUCATION ACT OF 1965 504 consultation with the Secretary of the Treasury, is authorized to purchase, or enter into forward commitments to purchase, from any eligible lender, as defined by section 435(d)(1), loans first disbursed under sections 428, 428B, or 428H on or after October 1, 2003, and before July 1, 2010, on such terms as the Secretary, the Secretary of the Treasury, and the Director of the Office of Management and Budget jointly determine are in the best interest of the United States, except that any pur- chase under this section shall not result in any net cost to the Federal Government (including the cost of servicing the loans purchased), as determined jointly by the Secretary, the Sec- retary of the Treasury, and the Director of the Office of Man- agement and Budget.
(2) FEDERAL REGISTER NOTICE.—The Secretary, the Sec- retary of the Treasury, and the Director of the Office of Man- agement and Budget, shall jointly publish a notice in the Fed- eral Register prior to any purchase of loans under paragraph (1) that— (A) establishes the terms and conditions governing the purchases authorized by paragraph (1); (B) includes an outline of the methodology and factors that the Secretary, the Secretary of the Treasury, and the Director of the Office of Management and Budget, will jointly consider in evaluating the price at which to pur- chase loans made under section 428, 428B, or 428H; and (C) describes how the use of such methodology and consideration of such factors used to determine purchase price will ensure that loan purchases do not result in any net cost to the Federal Government (including the cost of servicing the loans purchased).
(3) TEMPORARY AUTHORITY TO PURCHASE REHABILITATED LOANS.— (A) AUTHORITY.—In addition to the authority de- scribed in paragraph (1), the Secretary, in consultation with the Secretary of the Treasury, is authorized to pur- chase, or enter into forward commitments to purchase, from any eligible lender (as defined in section 435(d)(1)), loans that such lender purchased under section 428F on or after October 1, 2003, and before July 1, 2010, and that are not in default, on such terms as the Secretary, the Sec- retary of the Treasury, and the Director of the Office of Management and Budget jointly determine are in the best interest of the United States, except that any purchase under this paragraph shall not result in any net cost to the Federal Government (including the cost of servicing the loans purchased), as determined jointly by the Secretary, the Secretary of the Treasury, and the Director of the Of- fice of Management and Budget.
(B) FEDERAL REGISTER NOTICE.—The Secretary, the Secretary of the Treasury, and the Director of the Office of Management and Budget shall jointly publish a notice in the Federal Register prior to any purchase of loans under this paragraph that— September 8, 2023 As Amended Through P.L.
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459A (i) establishes the terms and conditions governing the purchases authorized by this paragraph; (ii) includes an outline of the methodology and fac- tors that the Secretary, the Secretary of the Treasury, and the Director of the Office of Management and Budget will jointly consider in evaluating the price at which to purchase loans rehabilitated pursuant to sec- tion 428F(a); and (iii) describes how the use of such methodology and consideration of such factors used to determine purchase price will ensure that loan purchases do not result in any net cost to the Federal Government (in- cluding the cost of servicing the loans purchased).
(b) PROCEEDS.—The Secretary shall require, as a condition of any purchase under subsection (a), that the funds paid by the Sec- retary to any eligible lender under this section be used— (1) to ensure continued participation of such lender in the Federal student loan programs authorized under part B of this title; and (2)(A) in the case of loans purchased pursuant to sub- section (a)(1), to originate new Federal loans to students, as authorized under part B of this title; or (B) in the case of loans purchased pursuant to subsection (a)(3), to originate such new Federal loans to students, or to purchase loans in accordance with section 428F(a).
(c) MAINTAINING SERVICING ARRANGEMENTS.—The Secretary may, if agreed upon by an eligible lender selling loans under this section, contract with such lender for the servicing of the loans pur- chased, provided that— (1) the cost of such servicing arrangement does not exceed the cost the Federal Government would otherwise incur for the servicing of loans purchased, as determined under subsection (a); and (2) such servicing arrangement is in the best interest of the borrowers whose loans are purchased.
(d) GUARANTY AGENCY RESPONSIBILITIES AND PAYMENTS.—Not- withstanding any other provision of this Act, beginning on the date on which the Secretary purchases a loan under this section— (1) the guaranty agency that insured such loan shall cease to have any obligations, responsibilities, or rights (including rights to any payment) under this Act for any activity related to the administration of such loan that is carried out or re- quired to be carried out on or after the date of such purchase; and (2) the insurance issued by such agency pursuant to sec- tion 428(b) for such loan shall cease to be effective with respect to any default on such loan that occurs on or after the date of such purchase.
(e) REPORTS AND COST ESTIMATES.—The Secretary shall pre- pare, transmit to the authorizing committees, and make available to the public, the following: (1) QUARTERLY REPORTS.— September 8, 2023 As Amended Through P.L.

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459A HIGHER EDUCATION ACT OF 1965 506 (A) CONTENTS.—Not later than 60 days after the end of each quarter during the period beginning July 1, 2008, and ending September 30, 2010, a quarterly report on— (i) the number of loans the Secretary has agreed to purchase, or has purchased, using the authority provided under this section, and the total amount of outstanding principal and accrued interest of such loans, during such period; and (ii) the number of loans in which the Secretary has purchased a participation interest, and the total amount of outstanding principal and accrued interest of such loans, during such period.
(B) DISAGGREGATED INFORMATION.—For each quarterly report, the information described in clauses (i) and (ii) of subparagraph (A) shall be disaggregated by lender and, for each lender, by category of institution (using the categories described in section 132(d)) and type of loan.
(2) ESTIMATES OF PURCHASE PROGRAM COSTS.—Not later than February 15, 2011, an estimate of the costs associated with the program of purchasing loans described in paragraph (1)(A)(i) during the period beginning July 1, 2008, and ending September 30, 2010, and an estimate of the costs associated with the program of purchasing a participation interest in loans described in paragraph (1)(A)(ii) during such period.
Each such estimate shall— (A) contain the same level of detail, and be reported in a similar manner, as the budget estimates provided for the loan program under part B and the direct student loan program under this part in the President’s annual budget submission to Congress, except that current and future ad- ministrative costs shall also be reported; (B) include an estimate of the gross and net outlays that have been, or will be, incurred by the Federal Govern- ment (including subsidy and administrative costs, and any payments made by the Department to lenders, trusts, or other entities related to such activities) in purchasing such loans or purchasing a participation interest in such loans during such period (as applicable); and (C) include a comparison of— (i) the average amount of the gross and net out- lays (including costs and payments) described in sub- paragraph (B) for each $100 of loans purchased or for which a participation interest was purchased (as ap- plicable) during such period, disaggregated by type of loan; with (ii) the average amount of such gross and net out- lays (including costs and payments) to the Federal Government for each $100 of comparable loans made under this part and part B during such period, disaggregated by part and by type of loan.
(3) ANNUAL COST ESTIMATES.—Not later than February 15 of the fiscal year following each of the fiscal years 2008, 2009, 2010, and 2011, an annual estimate of the costs associated with the program of purchasing loans described in paragraph September 8, 2023 As Amended Through P.L.
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460 (1)(A)(i), and an annual estimate of the costs associated with the program of purchasing a participation interest in loans de- scribed in paragraph (1)(A)(ii), that includes the information described in paragraph (2) for such fiscal year.
(f) EXPIRATION OF AUTHORITY.—The Secretary’s authority to purchase loans under this section shall expire on July 1, 2010.

SEC.

459B.

ø20 U.S.C.

1087i–2¿ TEMPORARY LOAN CONSOLIDATION AU- THORITY.


(a) TEMPORARY LOAN CONSOLIDATION AUTHORITY.— (1) IN GENERAL.—A borrower who has 1 or more loans in 2 or more of the categories described in paragraph (2), and who has not yet entered repayment on 1 or more of those loans in any of the categories, may consolidate all of the loans of the borrower that are described in paragraph (2) into a Federal Di- rect Consolidation Loan during the period described in para- graph (3).
(2) CATEGORIES OF LOANS THAT MAY BE CONSOLIDATED.— The categories of loans that may be consolidated under para- graph (1) are— (A) loans made under this part; (B) loans purchased by the Secretary pursuant to sec- tion 459A; and (C) loans made under part B that are held by an eligi- ble lender, as such term is defined in section 435(d).
(3) TIME PERIOD IN WHICH LOANS MAY BE CONSOLIDATED.— The Secretary may make a Federal Direct Consolidation Loan under this section to a borrower whose application for such Federal Direct Consolidation Loan is received on or after July 1, 2010, and before July 1, 2011.
(b) TERMS OF LOANS.—A Federal Direct Consolidation Loan made under this section shall have the same terms and conditions as a Federal Direct Consolidation Loan made under section 455(g), except that— (1) in determining the applicable rate of interest on the Federal Direct Consolidation Loan made under this section (other than on a Federal Direct Consolidation Loan described in paragraph (2)), section 427A(l)(3) shall be applied without rounding the weighted average of the interest rate on the loans consolidated to the nearest higher one-eighth of 1 percent as described in subparagraph (A) of section 427A(l)(3); and (2) if a Federal Direct Consolidation Loan made under this section that repays a loan which is subject to an interest rate determined under section 427A(g)(2), (j)(2), or (k)(2), then the interest rate for such Federal Direct Consolidation Loan shall be calculated— (A) by using the applicable rate of interest described in section 427A(g)(2), (j)(2), or (k)(2), respectively; and (B) in accordance with section 427A(l)(3).
SEC.

460. ø20 U.S.C.

1087j¿ LOAN CANCELLATION FOR TEACHERS.

(a) STATEMENT OF PURPOSE.—It is the purpose of this section to encourage individuals to enter and continue in the teaching pro- fession.

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460 HIGHER EDUCATION ACT OF 1965 508 (b) PROGRAM AUTHORIZED.—The Secretary shall carry out a program of canceling the obligation to repay a qualified loan amount in accordance with subsection (c) for Federal Direct Staf- ford Loans and Federal Direct Unsubsidized Stafford Loans made under this part for any new borrower on or after October 1, 1998, who— (1) has been employed as a full-time teacher for 5 consecu- tive complete school years— (A) in a school or location that qualifies under section 465(a)(2)(A) for loan cancellation for Perkins loan recipi- ents who teach in such schools or locations; and (B) if employed as an elementary school or secondary school teacher, is highly qualified as defined in section 9101 of the Elementary and Secondary Education Act of 1965, or meets the requirements of subsection (g)(3); and (2) is not in default on a loan for which the borrower seeks forgiveness.
(c) QUALIFIED LOAN AMOUNTS.— (1) IN GENERAL.—The Secretary shall cancel not more than $5,000 in the aggregate of the loan obligation on a Federal Di- rect Stafford Loan or a Federal Direct Unsubsidized Stafford Loan that is outstanding after the completion of the fifth com- plete school year of teaching described in subsection (b)(1).

No borrower may receive a reduction of loan obligations under both this section and section 428J.
(2) TREATMENT OF CONSOLIDATION LOANS.—A loan amount for a Federal Direct Consolidation Loan may be a qualified loan amount for the purposes of this subsection only to the ex- tent that such loan amount was used to repay a Federal Direct Stafford Loan, a Federal Direct Unsubsidized Stafford Loan, or a loan made under section 428 or 428H, for a borrower who meets the requirements of subsection (b), as determined in ac- cordance with regulations prescribed by the Secretary.
(3) ADDITIONAL AMOUNTS FOR TEACHERS IN MATHEMATICS, SCIENCE, OR the amount specified in paragraph (1), the aggregate amount that the Secretary shall cancel under this section shall be not more than $17,500 in the case of— EDUCATION.—Notwithstanding SPECIAL (A) a secondary school teacher— (i) who meets the requirements of subsection (b); and (ii) whose qualifying employment for purposes of such subsection is teaching mathematics or science on a full-time basis; and (B) an elementary school or secondary school teacher— (i) who meets the requirements of subsection (b); (ii) whose qualifying employment for purposes of such subsection is as a special education teacher whose primary responsibility is to provide special edu- cation to children with disabilities (as those terms are defined in section 602 of the Individuals with Disabil- ities Education Act); and (iii) who, as certified by the chief administrative officer of the public or non-profit private elementary September 8, 2023 As Amended Through P.L.
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460 school or secondary school in which the borrower is employed, or, in the case of a teacher who is employed by an educational service agency, as certified by the chief administrative officer of such agency, is teaching children with disabilities that correspond with the bor- rower’s special education training and has dem- onstrated knowledge and teaching skills in the content areas of the elementary school or secondary school cur- riculum that the borrower is teaching.
(d) REGULATIONS.—The Secretary is authorized to issue such regulations as may be necessary to carry out the provisions of this section.

(e) CONSTRUCTION.—Nothing in this section shall be construed to authorize any refunding of any canceled loan.
(f) LIST.—If the list of schools in which a teacher may perform service pursuant to subsection (b) is not available before May 1 of any year, the Secretary may use the list for the year preceding the year for which the determination is made to make such service de- termination.
(g) ADDITIONAL ELIGIBILITY PROVISIONS.— (1) CONTINUED ELIGIBILITY.—Any teacher who performs service in a school that— (A) meets the requirements of subsection (b)(1)(A) in any year during such service; and (B) in a subsequent year fails to meet the require- ments of such subsection, may continue to teach in such school and shall be eligible for loan cancellation pursuant to subsection (b).
(2) PREVENTION OF DOUBLE BENEFITS.—No borrower may, for the same voluntary service, receive a benefit under both this section and— (A) section 428K; (B) section 455(m); or (C) subtitle D of title I of the National and Community Service Act of 1990 (42 U.S.C.

12601 et seq.).
(3) PRIVATE SCHOOL TEACHERS.—An individual who is em- ployed as a teacher in a private school and is exempt from State certification requirements (unless otherwise applicable under State law), may, in lieu of the requirement of subsection (b)(1)(B), have such employment treated as qualifying employ- ment under this section if such individual is permitted to and does satisfy rigorous subject knowledge and skills tests by tak- ing competency tests in the applicable grade levels and subject areas.
For such purposes, the competency tests taken by such a private school teacher shall be recognized by 5 or more States for the purpose of fulfilling the highly qualified teacher requirements under section 9101 of the Elementary and Sec- ondary Education Act of 1965, and the score achieved by such teacher on each test shall equal or exceed the average passing score of those 5 States.
(h) DEFINITION.—For the purpose of this section, the term ‘‘year’’ where applied to service as a teacher means an academic year as defined by the Secretary.

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461 HIGHER EDUCATION ACT OF 1965 510 PART E—FEDERAL PERKINS LOANS SEC.

461. ø20 U.S.C.
461. ø20 U.S.C.

1087aa¿ APPROPRIATIONS AUTHORIZED.

(a) PROGRAM AUTHORITY.—The Secretary shall carry out a pro- gram assisting in the maintenance of funds at institutions of high- er education for the making of loans to undergraduate students in need to pursue their courses of study in such institutions or while engaged in programs of study abroad approved for credit by such institutions.

Loans made under this part shall be known as ‘‘Fed- eral Perkins Loans’’.
(b) AUTHORITY TO MAKE LOANS.— (1) IN GENERAL.— (A) LOANS FOR NEW UNDERGRADUATE FEDERAL PERKINS LOAN BORROWERS.—Through September 30, 2017, an insti- tution of higher education may make a loan under this part to an eligible undergraduate student who, on the date of disbursement of a loan made under this part, has no outstanding balance of principal or interest on a loan made under this part from the student loan fund established under this part by the institution, but only if the institu- tion has awarded all Federal Direct Loans, as referenced under subparagraphs (A) and (D) of section 455(a)(2), for which such undergraduate student is eligible.
(B) LOANS FOR CURRENT UNDERGRADUATE FEDERAL PERKINS LOAN BORROWERS.—Through September 30, 2017, an institution of higher education may make a loan under this part to an eligible undergraduate student who, on the date of disbursement of a loan made under this part, has an outstanding balance of principal or interest on a loan made under this part from the student loan fund estab- lished under this part by the institution, but only if the in- stitution has awarded all Federal Direct Stafford Loans as referenced under section 455(a)(2)(A) for which such un- dergraduate student is eligible.
(C) LOANS FOR CERTAIN GRADUATE BORROWERS.— Through September 30, 2016, with respect to an eligible graduate student who has received a loan made under this part prior to October 1, 2015, an institution of higher edu- cation that has most recently made such a loan to the stu- dent for an academic program at such institution may con- tinue making loans under this part from the student loan fund established under this part by the institution to en- able the student to continue or complete such academic program.
(2) NO ADDITIONAL LOANS.—An institution of higher edu- cation shall not make loans under this part after September 30, 2017.

(3) PROHIBITION ON ADDITIONAL APPROPRIATIONS.—No funds are authorized to be appropriated under this Act or any other Act to carry out the functions described in paragraph (1) for any fiscal year following fiscal year 2015.

SEC.

462. ø20 U.S.C.

1087bb¿ ALLOCATION OF FUNDS.


(a) ALLOCATION BASED ON PREVIOUS ALLOCATION.—(1) From the amount appropriated pursuant to section 461(b) for each fiscal September 8, 2023 As Amended Through P.L.

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462 year, the Secretary shall first allocate to each eligible institution an amount equal to— (A) 100 percent of the amount received under subsections (a) and (b) of this section for fiscal year 1999 (as such sub- sections were in effect with respect to allocations for such fiscal year), multiplied by (B) the institution’s default penalty, as determined under subsection (e), except that if the institution has a cohort default rate in excess of the applicable maximum cohort default rate under subsection (f), the institution may not receive an allocation under this paragraph.
(2)(A) From the amount so appropriated, the Secretary shall next allocate to each eligible institution that began participation in the program under this part after fiscal year 1999 but is not a first or second time participant, an amount equal to the greater of— (i) $5,000; or (ii) 100 percent of the amount received and expended under this part for the first year it participated in the pro- gram.
(B) From the amount so appropriated, the Secretary shall next allocate to each eligible institution that began participation in the program under this part after fiscal year 1999 and is a first or sec- ond time participant, an amount equal to the greatest of— (i) $5,000; (ii) an amount equal to (I) 90 percent of the amount re- ceived and used under this part in the second preceding fiscal year by eligible institutions offering comparable programs of instruction, divided by (II) the number of students enrolled at such comparable institutions in such fiscal year, multiplied by (III) the number of students enrolled at the applicant institu- tion in such fiscal year; or (iii) 90 percent of the institution’s allocation under this part for the preceding fiscal year.
(C) Notwithstanding subparagraphs (A) and (B) of this para- graph, the Secretary shall allocate to each eligible institution which— (i) was a first-time participant in the program in fiscal year 2000 or any subsequent fiscal year, and (ii) received a larger amount under this subsection in the second year of participation, an amount equal to 90 percent of the amount it received under this subsection in its second year of participation.
(D) For any fiscal year after a fiscal year in which an institu- tion receives an allocation under subparagraph (A), (B), or (C), the Secretary shall allocate to such institution an amount equal to the product of— (i) the amount determined under subparagraph (A), (B), or (C), multiplied by (ii) the institution’s default penalty, as determined under subsection (e), except that if the institution has a cohort default rate in excess of the applicable maximum cohort default rate under subsection (f), the institution may not receive an allocation under this paragraph.
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462 HIGHER EDUCATION ACT OF 1965 512 (3)(A) If the amount appropriated for any fiscal year is less than the amount required to be allocated to all institutions under paragraph (1) of this subsection, then the amount of the allocation to each such institution shall be ratably reduced.
(B) If the amount appropriated for any fiscal year is more than the amount required to be allocated to all institutions under para- graph (1) but less than the amount required to be allocated to all institutions under paragraph (2), then— (i) the Secretary shall allot the amount required to be allo- cated to all institutions under paragraph (1), and (ii) the amount of the allocation to each institution under paragraph (2) shall be ratably reduced.
(C) If additional amounts are appropriated for any such fiscal year, such reduced amounts shall be increased on the same basis as they were reduced (until the amount allocated equals the amount required to be allocated under paragraphs (1) and (2) of this subsection).
(b) ALLOCATION OF EXCESS BASED ON SHARE OF EXCESS ELIGI- BLE AMOUNTS.—(1) From the remainder of the amount appro- priated pursuant to section 461(b) after making the allocations re- quired by subsection (a) of this section, the Secretary shall allocate to each eligible institution which has an excess eligible amount an amount which bears the same ratio to such remainder as such ex- cess eligible amount bears to the sum of the excess eligible amounts of all such eligible institutions (having such excess eligible amounts).
(2) For any eligible institution, the excess eligible amount is the amount, if any, by which— (A)(i) that institution’s eligible amount (as determined under paragraph (3)), divided by (ii) the sum of the eligible amounts of all institutions (as so determined), multiplied by (iii) the amount appropriated pursuant to section 461(b) for the fiscal year; exceeds (B) the amount required to be allocated to that institution under subsection (a), except that an eligible institution which has a cohort default rate in excess of the applicable maximum cohort default rate under sub- section (f) may not receive an allocation under this paragraph.
(3) For any eligible institution, the eligible amount of that in- stitution is equal to— (A) the amount of the institution’s self-help need, as deter- mined under subsection (c); minus (B) the institution’s anticipated collections; multiplied by (C) the institution’s default penalty, as determined under subsection (e); except that, if the institution has a cohort default rate in excess of the applicable maximum cohort default rate under subsection (f), the eligible amount of that institution is zero.
(c) DETERMINATION OF INSTITUTION’S SELF-HELP NEED.—(1) The amount of an institution’s self-help need is equal to the sum of the self-help need of the institution’s eligible undergraduate stu- dents and the self-help need of the institution’s eligible graduate and professional students.

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462 (2) To determine the self-help need of an institution’s eligible undergraduate students, the Secretary shall— (A) establish various income categories for dependent and independent undergraduate students; (B) establish an expected family contribution 1 for each in- come category of dependent and independent undergraduate students, determined on the basis of the average expected fam- ily contribution 1 (computed in accordance with part F of this title) of a representative sample within each income category for the second preceding fiscal year; (C) compute 25 percent of the average cost of attendance for all undergraduate students; (D) multiply the number of eligible dependent students in each income category by the lesser of— (i) 25 percent of the average cost of attendance for all undergraduate students determined under subparagraph (C); or (ii) the average cost of attendance for all under- graduate students minus the expected family contribution 1 determined under subparagraph (B) for that income cat- egory, except that the amount computed by such subtrac- tion shall not be less than zero; (E) add the amounts determined under subparagraph (D) for each income category of dependent students; (F) multiply the number of eligible independent students in each income category by the lesser of— (i) 25 percent of the average cost of attendance for all undergraduate students determined under subparagraph (C); or (ii) the average cost of attendance for all under- graduate students minus the expected family contribution 1 determined under subparagraph (B) for that income cat- egory, except that the amount computed by such subtrac- tion for any income category shall not be less than zero; (G) add the amounts determined under subparagraph (F) for each income category of independent students; and (H) add the amounts determined under subparagraphs (E) and (G).
(3) To determine the self-help need of an institution’s eligible graduate and professional students, the Secretary shall— (A) establish various income categories for graduate and professional students; (B) establish an expected family contribution 1 for each in- come category of graduate and professional students, deter- mined on the basis of the average expected family contribu- tion 1 (computed in accordance with part F of this title) of a representative sample within each income category for the sec- ond preceding fiscal year; (C) determine the average cost of attendance for all grad- uate and professional students; (D) subtract from the average cost of attendance for all graduate and professional students (determined under sub- paragraph (C)), the expected family contribution 1 (determined under subparagraph (B)) for each income category, except that September 8, 2023 As Amended Through P.L.
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462 HIGHER EDUCATION ACT OF 1965 514 the amount computed by such subtraction for any income cat- egory shall not be less than zero; (E) multiply the amounts determined under subparagraph (D) by the number of eligible students in each category; (F) add the amounts determined under subparagraph (E) for each income category.
(4)(A) For purposes of paragraphs (2) and (3), the term ‘‘aver- age cost of attendance’’ means the average of the attendance costs for undergraduate students and for graduate and professional stu- dents, which shall include (i) tuition and fees determined in accord- ance with subparagraph (B), (ii) standard living expenses deter- mined in accordance with subparagraph (C), and (iii) books and supplies determined in accordance with subparagraph (D).
(B) The average undergraduate and graduate and professional tuition and fees described in subparagraph (A)(i) shall be computed on the basis of information reported by the institution to the Sec- retary, which shall include (i) total revenue received by the institu- tion from undergraduate and graduate tuition and fees for the sec- ond year preceding the year for which it is applying for an alloca- tion, and (ii) the institution’s enrollment for such second preceding year.
(C) The standard living expense described in subparagraph (A)(ii) is equal to 150 percent of the difference between the income protection allowance for a family of five with one in college and the income protection allowance for a family of six with one in college for a single independent student.

(D) The allowance for books and supplies described in subpara- graph (A)(iii) is equal to $600.
(d) ANTICIPATED COLLECTIONS.—(1) An institution’s anticipated collections are equal to the amount which was collected during the second year preceding the beginning of the award period, multi- plied by 1.21.

(2) The Secretary shall establish an appeals process by which the anticipated collections required in paragraph (1) may be waived for institutions with low cohort default rates in the program as- sisted under this part.
(e) DEFAULT PENALTIES.— (1) YEARS PRECEDING FISCAL YEAR 2000.—For any fiscal year preceding fiscal year 2000, any institution with a cohort default rate that— (A) equals or exceeds 15 percent, shall establish a de- fault reduction plan pursuant to regulations prescribed by the Secretary, except that such plan shall not be required with respect to an institution that has a default rate of less than 20 percent and that has less than 100 students who have loans under this part in such academic year; (B) equals or exceeds 20 percent, but is less than 25 percent, shall have a default penalty of 0.9; (C) equals or exceeds 25 percent, but is less than 30 percent, shall have a default penalty of 0.7; and (D) equals or exceeds 30 percent shall have a default penalty of zero.
(2) YEARS FOLLOWING FISCAL YEAR 2000.—For fiscal year 2000 and any succeeding fiscal year, any institution with a co- September 8, 2023 As Amended Through P.L.

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462 hort default rate (as defined under subsection (g)) that equals or exceeds 25 percent shall have a default penalty of zero.
(3) INELIGIBILITY.— (A) IN GENERAL.—For fiscal year 2000 and any suc- ceeding fiscal year, any institution with a cohort default rate (as defined in subsection (g)) that equals or exceeds 50 percent for each of the 3 most recent years for which data are available shall not be eligible to participate in a program under this part for the fiscal year for which the determination is made and the 2 succeeding fiscal years, unless, within 30 days of receiving notification from the Secretary of the loss of eligibility under this paragraph, the institution appeals the loss of eligibility to the Sec- retary.
The Secretary shall issue a decision on any such appeal within 45 days after the submission of the appeal.
Such decision may permit the institution to continue to participate in a program under this part if— (i) the institution demonstrates to the satisfaction of the Secretary that the calculation of the institu- tion’s cohort default rate is not accurate, and that re- calculation would reduce the institution’s cohort de- fault rate for any of the 3 fiscal years below 50 per- cent; or (ii) there are, in the judgment of the Secretary, such a small number of borrowers entering repayment that the application of this subparagraph would be in- equitable.
(B) CONTINUED PARTICIPATION.—During an appeal under subparagraph (A), the Secretary may permit the in- stitution to continue to participate in a program under this part.
(C) RETURN OF FUNDS.—Within 90 days after the date of any termination pursuant to subparagraph (A), or the conclusion of any appeal pursuant to subparagraph (B), whichever is later, the balance of the student loan fund es- tablished under this part by the institution that is the sub- ject of the termination shall be distributed as follows: (i) The Secretary shall first be paid an amount which bears the same ratio to such balance (as of the date of such distribution) as the total amount of Fed- eral capital contributions to such fund by the Sec- retary under this part bears to the sum of such Fed- eral capital contributions and the capital contributions to such fund made by the institution.
(ii) The remainder of such student loan fund shall be paid to the institution.

(D) USE OF RETURNED FUNDS.—Any funds returned to the Secretary under this paragraph shall be reallocated to institutions of higher education pursuant to subsection (i).

(E) DEFINITION.—For the purposes of subparagraph (A), the term ‘‘loss of eligibility’’ shall be defined as the mandatory liquidation of an institution’s student loan fund, and assignment of the institution’s outstanding loan portfolio to the Secretary.
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462 HIGHER EDUCATION ACT OF 1965 516 (f) APPLICABLE MAXIMUM COHORT DEFAULT RATE.— (1) AWARD YEARS PRIOR TO 2000.—For award years prior to award year 2000, the applicable maximum cohort default rate is 30 percent.
(2) AWARD YEAR 2000 AND SUCCEEDING AWARD YEARS.—For award year 2000 and subsequent years, the applicable max- imum cohort default rate is 25 percent.
(g) DEFINITION OF COHORT DEFAULT RATE.— (1)(A) The term ‘‘cohort default rate’’ means, for any award year in which 30 or more current and former students at the institution enter repayment on loans under this part (received for attendance at the institution), the percentage of those cur- rent and former students who enter repayment on such loans (received for attendance at that institution) in that award year who default before the end of the following award year.
(B) For any award year in which less than 30 of the insti- tution’s current and former students enter repayment, the term ‘‘cohort default rate’’ means the percentage of such cur- rent and former students who entered repayment on such loans in any of the three most recent award years and who de- fault before the end of the award year immediately following the year in which they entered repayment.
(C) A loan on which a payment is made by the institution of higher education, its owner, agency, contractor, employee, or any other entity or individual affiliated with such institution, in order to avoid default by the borrower, is considered as in default for the purposes of this subsection.
(D) In the case of a student who has attended and bor- rowed at more than one school, the student (and his or her subsequent repayment or default) is attributed to the school for attendance at which the student received the loan that entered repayment in the award year.
(E) In determining the number of students who default be- fore the end of such award year, the institution, in calculating the cohort default rate, shall exclude— (i) any loan on which the borrower has, after the time periods specified in paragraph (2)— (I) voluntarily made 6 consecutive payments; (II) voluntarily made all payments currently due; (III) repaid in full the amount due on the loan; or (IV) received a deferment or forbearance, based on a condition that began prior to such time periods; (ii) any loan which has, after the time periods speci- fied in paragraph (2), been rehabilitated or canceled; and (iii) any other loan that the Secretary determines should be excluded from such determination.
(F) The Secretary shall prescribe regulations designed to prevent an institution from evading the application to that in- stitution of a cohort default rate determination under this sub- section through the use of such measures as branching, con- solidation, change of ownership or control or other means as determined by the Secretary.

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463 (2) For purposes of calculating the cohort default rate under this subsection, a loan shall be considered to be in de- fault— (A) 240 days (in the case of a loan repayable monthly), (B) 270 days (in the case of a loan repayable quar- or terly), after the borrower fails to make an installment payment when due or to comply with other terms of the promissory note.
(h) FILING DEADLINES.—The Secretary shall, from time to time, set dates before which institutions must file applications for alloca- tions under this part.
(i) REALLOCATION OF EXCESS ALLOCATIONS.— (1) IN GENERAL.—(A) If an institution of higher education returns to the Secretary any portion of the sums allocated to such institution under this section for any fiscal year, the Sec- retary shall reallocate 80 percent of such returned portions to participating institutions in an amount not to exceed such par- ticipating institution’s excess eligible amounts as determined under paragraph (2).
(B) For the purpose of this subsection, the term ‘‘partici- pating institution’’ means an institution of higher education that— (i) was a participant in the program assisted under this part in fiscal year 1999; and (ii) did not receive an allocation under subsection (a) in the fiscal year for which the reallocation determination is made.
(2) EXCESS ELIGIBLE AMOUNT.—For any participating insti- tution, the excess eligible amount is the amount, if any, by which— (A)(i) that institution’s eligible amount (as determined under subsection (b)(3)), divided by (ii) the sum of the eli- gible amounts of all participating institutions (as deter- mined under paragraph (3)), multiplied by (iii) the amount of funds available for reallocation under this subsection; exceeds (B) the amount required to be allocated to that institu- tion under subsection (b).
(3) REMAINDER.—The Secretary shall reallocate the re- mainder of such returned portions in accordance with regula- tions of the Secretary.

(4) ALLOCATION REDUCTIONS.—If under paragraph (1) of this subsection an institution returns more than 10 percent of its allocation, the institution’s allocation for the next fiscal year shall be reduced by the amount returned.
The Secretary may waive this paragraph for a specific institution if the Secretary finds that enforcing it is contrary to the interest of the pro- gram.

SEC.

463. ø20 U.S.C.

1087cc¿ AGREEMENTS WITH INSTITUTIONS OF HIGHER EDUCATION.

(a) CONTENTS OF AGREEMENTS.—An agreement with any insti- tution of higher education for the payment of Federal capital con- tributions under this part shall— September 8, 2023 As Amended Through P.L.
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463 HIGHER EDUCATION ACT OF 1965 518 (1) provide for the establishment and maintenance of a student loan fund for the purpose of this part; (2) provide for the deposit in such fund of— (A) Federal capital contributions from funds appro- priated under section 461; (B) a capital contribution by an institution in an amount equal to one-third of the Federal capital contribu- tions described in subparagraph (A); (C) collections of principal and interest on student loans made from deposited funds; (D) charges collected pursuant to regulations under section 464(c)(1)(H); and (E) any other earnings of the funds; (3) provide that such student loan fund shall be used only (A) loans to students, in accordance with the provi- sions of this part; (B) administrative expenses, as provided in subsection (C) capital distributions, as provided in section 466; for— (b); and (D) costs of litigation, and other collection costs agreed to by the Secretary in connection with the collection of a loan from the fund (and interest thereon) or a charge as- sessed pursuant to regulations under section 464(c)(1)(H); (4) provide that where a note or written agreement evi- dencing a loan has been in default despite due diligence on the part of the institution in attempting collection thereon— (A) if the institution has knowingly failed to maintain an acceptable collection record with respect to such loan, as determined by the Secretary in accordance with criteria established by regulation, the Secretary may— (i) require the institution to assign such note or agreement to the Secretary, without recompense; and (ii) apportion any sums collected on such a loan, less an amount not to exceed 30 percent of any sums collected to cover the Secretary’s collection costs, among other institutions in accordance with section 462; or (B) if the institution is not one described in subpara- graph (A), the Secretary may allow such institution to refer such note or agreement to the Secretary, without rec- ompense, except that, once every six months, any sums col-
 lected on such a loan (less an amount not to exceed 30 per- cent of any such sums collected to cover the Secretary’s collection costs) shall be repaid to such institution and treated as an additional capital contribution under section 462; (5) provide that, if an institution of higher education deter- mines not to service and collect student loans made available from funds under this part, the institution will assign, at the beginning of the repayment period, notes or evidence of obliga- tions of student loans made from such funds to the Secretary and the Secretary shall apportion any sums collected on such September 8, 2023 As Amended Through P.L.
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463 notes or obligations (less an amount not to exceed 30 percent of any such sums collected to cover that Secretary’s collection costs) among other institutions in accordance with section 462; (6) provide that, notwithstanding any other provision of law, the Secretary will provide to the institution any informa- tion with respect to the names and addresses of borrowers or other relevant information which is available to the Secretary, from whatever source such information may be derived; (7) provide assurances that the institution will comply with the provisions of section 463A; (8) provide that the institution of higher education will make loans first to students with exceptional need; and (9) include such other reasonable provisions as may be nec- essary to protect the United States from unreasonable risk of loss and as are agreed to by the Secretary and the institution, except that nothing in this paragraph shall be construed to permit the Secretary to require the assignment of loans to the Secretary other than as is provided for in paragraphs (4) and (5).
(b) ADMINISTRATIVE EXPENSES.—An institution which has en- tered into an agreement under subsection (a) shall be entitled, for each fiscal year during which it makes student loans from a stu- dent loan fund established under such agreement, to a payment in lieu of reimbursement for its expenses in administering its student loan program under this part during such year.

Such payment shall be made in accordance with section 489.
(c) COOPERATIVE AGREEMENTS WITH CONSUMER REPORTING AGENCIES.—(1) For the purpose of promoting responsible repay- ment of loans made pursuant to this part, the Secretary and each institution of higher education participating in the program under this part shall enter into cooperative agreements with consumer re- porting agencies to provide for the exchange of information con- cerning student borrowers concerning whom the Secretary has re- ceived a referral pursuant to section 467 and regarding loans held by the Secretary or an institution.
(2) Each cooperative agreement made pursuant to paragraph (1) shall be made in accordance with the requirements of section 430A except that such agreement shall provide for the disclosure by the Secretary or an institution, as the case may be, to such con- sumer reporting agencies, with respect to any loan held by the Sec- retary or the institution, respectively, of— (A) the date of disbursement and the amount of such loans made to any borrower under this part at the time of disburse- ment of the loan; (B) information concerning the repayment and collection of any such loan, including information concerning the status of such loan; and (C) the date of cancellation of the note upon completion of repayment by the borrower of any such loan, or upon cancella- tion or discharge of the borrower’s obligation on the loan for any reason.
(3) Notwithstanding paragraphs (4) and (5) of subsection (a) of section 605 of the Fair Credit Reporting Act (15 U.S.C.

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463A HIGHER EDUCATION ACT OF 1965 520 information received from the Secretary or an institution regarding the status of a borrower’s account on a loan made under this part until the loan is paid in full.
(4)(A) Except as provided in subparagraph (B), an institution of higher education, after consultation with the Secretary and pur- suant to the agreements entered into under paragraph (1), shall disclose at least annually to any consumer reporting agency with which the Secretary has such an agreement the information set forth in paragraph (2), and shall disclose promptly to such con- sumer reporting agency any changes to the information previously disclosed.
(B) The Secretary may promulgate regulations establishing cri- teria under which an institution of higher education may cease re- porting the information described in paragraph (2) before a loan is paid in full.
(5) Each institution of higher education shall notify the appro- priate consumer reporting agencies whenever a borrower of a loan that is made and held by the institution and that is in default makes 6 consecutive monthly payments on such loan, for the pur- pose of encouraging such consumer reporting agencies to update the status of information maintained with respect to that borrower.
(d) LIMITATION ON USE OF INTEREST BEARING ACCOUNTS.—In carrying out the provisions of subsection (a)(9), the Secretary may not require that any collection agency, collection attorney, or loan servicer collecting loans made under this part deposit amounts col- lected on such loans in interest bearing accounts, unless such agen- cy, attorney, or servicer holds such amounts for more than 45 days.
(e) SPECIAL DUE DILIGENCE RULE.—In carrying out the provi- sions of subsection (a)(5) relating to due diligence, the Secretary shall make every effort to ensure that institutions of higher edu- cation may use Internal Revenue Service skip-tracing collection procedures on loans made under this part.

SEC.

463A.

ø20 U.S.C.

1087cc–1¿ STUDENT LOAN INFORMATION BY ELI- GIBLE INSTITUTIONS.
(a) DISCLOSURE REQUIRED PRIOR TO DISBURSEMENT.—Each in- stitution of higher education shall, at or prior to the time such in- stitution makes a loan to a student borrower which is made under this part, provide thorough and adequate loan information on such loan to the student borrower.
Any disclosure required by this sub- section may be made by an institution of higher education as part of the written application material provided to the borrower, or as part of the promissory note evidencing the loan, or on a separate written form provided to the borrower.
The disclosures shall in- clude— (1) the name of the institution of higher education, and the address to which communications and payments should be sent; (2) the principal amount of the loan; (3) the amount of any charges collected by the institution at or prior to the disbursal of the loan and whether such charges are deducted from the proceeds of the loan or paid sep- arately by the borrower; (4) the stated interest rate on the loan; September 8, 2023 As Amended Through P.L.
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463A (5) the yearly and cumulative maximum amounts that may be borrowed; (6) an explanation of when repayment of the loan will be required and when the borrower will be obligated to pay inter- est that accrues on the loan; (7) a statement as to the minimum and maximum repay- ment term which the institution may impose, and the min- imum monthly payment required by law and a description of any penalty imposed as a consequence of default, such as li- ability for expenses reasonably incurred in attempts by the Secretary or institutions to collect on a loan; (8) a statement of the total cumulative balance, including the loan applied for, owed by the student to that lender, and an estimate of the projected monthly payment, given such cu- mulative balance; (9) an explanation of any special options the borrower may have for loan consolidation or other refinancing of the loan; (10) a statement that the borrower has the right to prepay all or part of the loan, at any time, without penalty, a state- ment summarizing circumstances in which repayment of the loan or interest that accrues on the loan may be deferred, and a brief notice of the program for repayment of loans, on the basis of military service, pursuant to the Department of De- fense educational loan repayment program (10 U.S.C.
16302); (11) a definition of default and the consequences to the borrower if the borrower defaults, together with a statement that the disbursement of, and the default on, a loan under this part, shall be reported to a consumer reporting agency; (12) to the extent practicable, the effect of accepting the loan on the eligibility of the borrower for other forms of stu- dent assistance; (13) an explanation of any cost the borrower may incur in the making or collection of the loan; (14) a notice and explanation regarding the end to future availability of loans made under this part; (15) a notice and explanation that repayment and forgive- ness benefits available to borrowers of loans made under part D are not available to borrowers participating in the loan pro- gram under this part; (16) a notice and explanation regarding a borrower’s option to consolidate a loan made under this part into a Federal Di- rect Loan under part D, including any benefit of such consoli- dation; (17) with respect to new undergraduate Federal Perkins loan borrowers, as described in section 461(b)(1)(A), a notice and explanation providing a comparison of the interest rates of loans under this part and part D and informing the borrower that the borrower has reached the maximum annual borrowing limit for which the borrower is eligible as referenced under subparagraphs (A) and (D) of section 455(a)(2); and (18) with respect to current undergraduate Federal Per- kins loan borrowers, as described in section 461(b)(1)(B), a no- tice and explanation providing a comparison of the interest rates of loans under this part and part D and informing the September 8, 2023 As Amended Through P.L.
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464 HIGHER EDUCATION ACT OF 1965 522 borrower that the borrower has reached the maximum annual borrowing limit for which the borrower is eligible on Federal Direct Stafford Loans as referenced under section 455(a)(2)(A).
(b) DISCLOSURE REQUIRED PRIOR TO REPAYMENT.—Each insti- tution of higher education shall enter into an agreement with the Secretary under which the institution will, prior to the start of the repayment period of the student borrower on loans made under this part, disclose to the student borrower the information required under this subsection.
Any disclosure required by this subsection may be made by an institution of higher education either in a promissory note evidencing the loan or loans or in a written state- ment provided to the borrower.
The disclosures shall include— (1) the name of the institution of higher education, and the address to which communications and payments should be sent; (2) the scheduled date upon which the repayment period is to begin; (3) the estimated balance owed by the borrower on the loan or loans covered by the disclosure as of the scheduled date on which the repayment period is to begin (including, if appli- cable, the estimated amount of interest to be capitalized); (4) the stated interest rate on the loan or loans, or the combined interest rate of loans with different stated interest rates; (5) the nature of any fees which may accrue or be charged to the borrower during the repayment period; (6) the repayment schedule for all loans covered by the dis- closure including the date the first installment is due, and the number, amount, and frequency of required payments; (7) an explanation of any special options the borrower may have for loan consolidation or other refinancing of the loan; (8) the projected total of interest charges which the bor- rower will pay on the loan or loans, assuming that the bor- rower makes payments exactly in accordance with the repay- ment schedule; and (9) a statement that the borrower has the right to prepay all or part of the loan or loans covered by the disclosure at any time without penalty.
(c) COSTS AND EFFECTS OF DISCLOSURES.—Such information shall be available without cost to the borrower.

The failure of an eligible institution to provide information as required by this sec- tion shall not (1) relieve a borrower of the obligation to repay a loan in accordance with its terms, (2) provide a basis for a claim for civil damages, or (3) be deemed to abrogate the obligation of the Secretary to make payments with respect to such loan.

SEC.

464. ø20 U.S.C.

1087dd¿ TERMS OF LOANS.


(a) TERMS AND CONDITIONS.—(1) Loans from any student loan fund established pursuant to an agreement under section 463 to any student by any institution shall, subject to such conditions, limitations, and requirements as the Secretary shall prescribe by regulation, be made on such terms and conditions as the institution may determine.

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464 (2)(A) Except as provided in paragraph (4), the total of loans made to a student in any academic year or its equivalent by an in- stitution of higher education from a loan fund established pursuant to an agreement under this part shall not exceed— (i) $5,500, in the case of a student who has not successfully completed a program of undergraduate education; or (ii) $8,000, in the case of a graduate or professional stu- dent (as defined in regulations issued by the Secretary).
(B) Except as provided in paragraph (4), the aggregate unpaid principal amount for all loans made to a student by institutions of higher education from loan funds established pursuant to agree- ments under this part may not exceed— (i) $60,000, in the case of any graduate or professional stu- dent (as defined by regulations issued by the Secretary, and in- cluding any loans from such funds made to such person before such person became a graduate or professional student); (ii) $27,500, in the case of a student who has successfully completed 2 years of a program of education leading to a bach- elor’s degree but who has not completed the work necessary for such a degree (determined under regulations issued by the Sec- retary), and including any loans from such funds made to such person before such person became such a student; and (iii) $11,000, in the case of any other student.
(3) Regulations of the Secretary under paragraph (1) shall be designed to prevent the impairment of the capital student loan funds to the maximum extent practicable and with a view toward the objective of enabling the student to complete his course of study.
(4) In the case of a program of study abroad that is approved for credit by the home institution at which a student is enrolled and that has reasonable costs in excess of the home institution’s budget, the annual and aggregate loan limits for the student may exceed the amounts described in paragraphs (2)(A) and (2)(B) by 20 percent.
(b) DEMONSTRATION OF NEED AND ELIGIBILITY REQUIRED.—(1) A loan from a student loan fund assisted under this part may be made only to a student who demonstrates financial need in accord- ance with part F of this title, who meets the requirements of sec- tion 484, and who provides the institution with the student’s driv- ers license number, if any, at the time of application for the loan.
A student who is in default on a loan under this part shall not be eligible for an additional loan under this part unless such loan meets one of the conditions for exclusion under section 462(g)(1)(E).
(2) If the institution’s capital contribution under section 462 is directly or indirectly based in part on the financial need dem- onstrated by students who are (A) attending the institution less than full time, or (B) independent students, then a reasonable por- tion of the loans made from the institution’s student loan fund con- taining the contribution shall be made available to such students.
(c) CONTENTS OF LOAN AGREEMENT.—(1) Any agreement be- tween an institution and a student for a loan from a student loan fund assisted under this part— (A) shall be evidenced by note or other written instrument which, except as provided in paragraph (2), provides for repay- September 8, 2023 As Amended Through P.L.
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464 HIGHER EDUCATION ACT OF 1965 524 ment of the principal amount of the loan, together with inter- est thereon, in equal installments (or, if the borrower so re- quests, in graduated periodic installments determined in ac- cordance with such schedules as may be approved by the Sec- retary) payable quarterly, bimonthly, or monthly, at the option of the institution, over a period beginning nine months after the date on which the student ceases to carry, at an institution of higher education or a comparable institution outside the United States approved for this purpose by the Secretary, at least one-half the normal full-time academic workload, and ending 10 years and 9 months after such date except that such period may begin earlier than 9 months after such date upon the request of the borrower; (B) shall include provision for acceleration of repayment of the whole, or any part, of such loan, at the option of the bor- rower; (C)(i) may provide, at the option of the institution, in ac- cordance with regulations of the Secretary, that during the re- payment period of the loan, payments of principal and interest by the borrower with respect to all outstanding loans made to the student from a student loan fund assisted under this part shall be at a rate equal to not less than $40 per month, except that the institution may, subject to such regulations, permit a borrower to pay less than $40 per month for a period of not more than one year where necessary to avoid hardship to the borrower, but without extending the 10-year maximum repay- ment period provided for in subparagraph (A) of this para- graph; and (ii) may provide that the total payments by a borrower for a monthly or similar payment period with respect to the aggre- gate of all loans held by the institution may, when the amount of a monthly or other similar payment is not a multiple of $5, be rounded to the next highest whole dollar amount that is a multiple of $5; (D) shall provide that the loan shall bear interest, on the unpaid balance of the loan, at the
 rate of 5 percent per year in the case of any loan made on or after October 1, 1981, ex- cept that no interest shall accrue (i) prior to the beginning date of repayment determined under paragraph (2)(A)(i), or (ii) dur- ing any period in which repayment is suspended by reason of paragraph (2); (E) shall provide that the loan shall be made without secu- rity and without endorsement; (F) shall provide that the liability to repay the loan shall be cancelled— (i) 53 upon the death of the borrower; (ii) 53 if the borrower becomes permanently and to- tally disabled as determined in accordance with regu- lations of the Secretary; (iii) 53 if the borrower is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment that can September 8, 2023 As Amended Through P.L.
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464 be expected to result in death, has lasted for a contin- uous period of not less than 60 months, or can be ex- pected to last for a continuous period of not less than 60 months; or (iv) 53 if the borrower is determined by the Sec- retary of Veterans Affairs to be unemployable due to a service-connected disability; (G) shall provide that no note or evidence of obligation may be assigned by the lender, except upon the transfer of the borrower to another institution participating under this part (or, if not so participating, is eligible to do so and is approved by the Secretary for such purpose), to such institution, and ex- cept as necessary to carry out section 463(a)(6); (H) pursuant to regulations of the Secretary, shall provide for an assessment of a charge with respect to the loan for fail- ure of the borrower to pay all or part of an installment when due, which shall include the expenses reasonably incurred in attempting collection of the loan, to the extent permitted by the Secretary, except that no charge imposed under this sub- paragraph shall exceed 20 percent of the amount of the month- ly payment of the borrower; and (I) shall contain a notice of the system of disclosure of in- formation concerning default on such loan to consumer report- ing agencies under section 463(c).
(2)(A) No repayment of principal of, or interest on, any loan from a student loan fund assisted under this part shall be required during any period— (i) during which the borrower— (I) is pursuing at least a half-time course of study as determined by an eligible institution; or (II) is pursuing a course of study pursuant to a grad- uate fellowship program approved by the Secretary, or pursuant to a rehabilitation training program for disabled individuals approved by the Secretary, except that no borrower shall be eligible for a deferment under this clause, or loan made under this part while serving in a medical internship or residency program; (ii) not in excess of 3 years during which the borrower is seeking and unable to find full-time employment; (iii) during which the borrower— (I) is serving on active duty during a war or other military operation or national emergency; or (II) is performing qualifying National Guard duty dur- ing a war or other military operation or national emer- gency, and for the 180-day period following the demobilization date for the service described in subclause (I) or (II); (iv) not in excess of 3 years for any reason which the lend- er determines, in accordance with regulations prescribed by the Secretary under section 435(o), has caused or will cause the borrower to have an economic hardship; (v) during which the borrower is engaged in service de- scribed in section 465(a)(2); or September 8, 2023 As Amended Through P.L.
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464 HIGHER EDUCATION ACT OF 1965 526 (vi) 54 during which the borrower is receiving treat- ment for cancer and the 6 months after such period; and provides that any such period shall not be included in deter- mining the 10-year period described in subparagraph (A) of para- graph (1).
(B) No repayment of principal of, or interest on, any loan for any period described in subparagraph (A) shall begin until 6 months after the completion of such period.
(C) An individual with an outstanding loan balance who meets the eligibility criteria for a deferment described in subparagraph (A) as in effect on the date of enactment of this subparagraph shall be eligible for deferment under this paragraph notwithstanding any contrary provision of the promissory note under which the loan or loans were made, and notwithstanding any amendment (or effec- tive date provision relating to any amendment) to this section made prior to the date of such deferment.
(3)(A) The Secretary is authorized, when good cause is shown, to extend, in accordance with regulations, the 10-year maximum re- payment period provided for in subparagraph (A) of paragraph (1) with respect to individual loans.
(B) Pursuant to uniform criteria established by the Secretary, the repayment period for any student borrower who during the re- payment period is a low-income individual may be extended for a period not to exceed 10 years and the repayment schedule may be adjusted to reflect the income of that individual.
(4) The repayment period for a loan made under this part shall begin on the day immediately following the expiration of the pe- riod, specified in paragraph (1)(A), after the student ceases to carry the required academic workload, unless the borrower requests and is granted a repayment schedule that provides for repayment to commence at an earlier point in time, and shall exclude any period of authorized deferment, forbearance, or cancellation.
(5) The institution may elect— (A) to add the amount of any charge imposed under para- graph (1)(H) to the principal amount of the loan as of the first day after the day on which the installment was due and to no- tify the borrower of the assessment of the charge; or (B) to make the amount of the charge payable to the insti- tution not later than the due date of the next installment.
(6) Requests for deferment of repayment of loans under this part by students engaged in graduate or post-graduate fellowship- supported study (such as pursuant to a Fulbright grant) outside the United States shall be approved until completion of the period of the fellowship.
(7) There shall be excluded from the 9-month period that be- gins on the date on which a student ceases to carry at least one- half the normal full-time academic workload (as described in para- graph (1)(A)) any period not to exceed 3 years during which a bor- rower who is a member of a reserve component of the Armed Forces named in section 10101 of title 10, United States Code, is called or ordered to active duty for a period of more than 30 days (as defined in section 101(d)(2) of such title).
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464 sion shall include the period necessary to resume enrollment at the borrower’s next available regular enrollment period.
(d) AVAILABILITY OF LOAN FUND TO ALL ELIGIBLE STUDENTS.— An agreement under this part for payment of Federal capital con- tributions shall include provisions designed to make loans from the student loan fund established pursuant to such agreement reason- ably available (to the extent of the available funds in such fund) to all eligible students in such institutions in need thereof.
(e) FORBEARANCE.—(1) The Secretary shall ensure that, as doc- umented in accordance with paragraph (2), an institution of higher education shall grant a borrower forbearance of principal and inter- est or principal only, renewable at 12-month intervals for a period not to exceed 3 years, on such terms as are otherwise consistent with the regulations issued by the Secretary and agreed upon in writing by the parties to the loan, if— (A) the borrower’s debt burden equals or exceeds 20 per- cent of such borrower’s gross income; (B) the institution determines that the borrower should qualify for forbearance for other reasons; or (C) the borrower is eligible for interest payments to be made on such loan for service in the Armed Forces under sec- tion 2174 of title 10, United States Code, and, pursuant to that eligibility, the interest on such loan is being paid under sub- section (j), except that the form of a forbearance under this paragraph shall be a temporary cessation of all payments on the loan other than payments of interest on the loan that are made under subsection (j).
(2) For the purpose of paragraph (1), the terms of forbearance agreed to by the parties shall be documented by— (A) confirming the agreement of the borrower by notice to the borrower from the institution of higher education; and (B) recording the terms in the borrower’s file.
(f) SPECIAL REPAYMENT RULE AUTHORITY.—(1) Subject to such restrictions as the Secretary may prescribe to protect the interest of the United States, in order to encourage repayment of loans made under this part which are in default, the Secretary may, in the agreement entered into under this part, authorize an institu- tion of higher education to compromise on the repayment of such defaulted loans in accordance with paragraph (2).
The Federal share of the compromise repayment shall bear the same relation to the institution’s share of such compromise repayment as the Fed- eral capital contribution to the institution’s loan fund under this part bears to the institution’s capital contribution to such fund.
(2) No compromise repayment of a defaulted loan as authorized by paragraph (1) may be made unless the student borrower pays— (A) 90 percent of the loan under this part; (B) the interest due on such loan; and (C) any collection fees due on such loan; in a lump sum payment.
(g) DISCHARGE.— (1) IN GENERAL.—If a student borrower who received a loan made under this part on or after January 1, 1986, is un- able to complete the program in which such student is enrolled due to the closure of the institution, then the Secretary shall September 8, 2023 As Amended Through P.L.

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464 HIGHER EDUCATION ACT OF 1965 528 discharge the borrower’s liability on the loan (including the in- terest and collection fees) and shall subsequently pursue any claim available to such borrower against the institution and the institution’s affiliates and principals, or settle the loan obli- gation pursuant to the financial responsibility standards de- scribed in section 498(c).
(2) ASSIGNMENT.—A borrower whose loan has been dis- charged pursuant to this subsection shall be deemed to have assigned to the United States the right to a loan refund in an amount that does not exceed the amount discharged against the institution and the institution’s affiliates and principals.
(3) ELIGIBILITY FOR ADDITIONAL ASSISTANCE.—The period during which a student was unable to complete a course of study due to the closing of the institution shall not be consid- ered for purposes of calculating the student’s period of eligi- bility for additional assistance under this title.
(4) SPECIAL RULE.—A borrower whose loan has been dis- charged pursuant to this subsection shall not be precluded, be- cause of that discharge, from receiving additional grant, loan, or work assistance under this title for which the borrower would be otherwise eligible (but for the default on the dis- charged loan).

The amount discharged under this subsection shall be treated as an amount canceled under section 465(a).
(5) REPORTING.—The Secretary or institution, as the case may be, shall report to consumer reporting agencies with re- spect to loans that have been discharged pursuant to this sub- section.
(h) REHABILITATION OF LOANS.— (1) REHABILITATION.— (A) IN GENERAL.—If the borrower of a loan made under this part who has defaulted on the loan makes 9 on- time, consecutive, monthly payments of amounts owed on the loan, as determined by the institution, or by the Sec- retary in the case of a loan held by the Secretary, the loan shall be considered rehabilitated, and the institution that made that loan (or the Secretary, in the case of a loan held by the Secretary) shall request that any consumer report- ing agency to which the default was reported remove the default from the borrower’s credit history.
(B) COMPARABLE CONDITIONS.—As long as the bor- rower continues to make scheduled repayments on a loan rehabilitated under this paragraph, the rehabilitated loan shall be subject to the same terms and conditions, and qualify for the same benefits and privileges, as other loans made under this part.
(C) ADDITIONAL ASSISTANCE.—The borrower of a reha- bilitated loan shall not be precluded by section 484 from receiving additional grant, loan, or work assistance under this title (for which the borrower is otherwise eligible) on the basis of defaulting on the loan prior to such rehabilita- tion.

(D) LIMITATIONS.—A borrower only once may obtain the benefit of this paragraph with respect to rehabilitating a loan under this part.

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464 (2) RESTORATION OF ELIGIBILITY.—If the borrower of a loan made under this part who has defaulted on that loan makes 6 ontime, consecutive, monthly payments of amounts owed on such loan, the borrower’s eligibility for grant, loan, or work as- sistance under this title shall be restored to the extent that the borrower is otherwise eligible.

A borrower only once may ob- tain the benefit of this paragraph with respect to restored eligi- bility.
(i) INCENTIVE REPAYMENT PROGRAM.— (1) IN GENERAL.—Each institution of higher education may establish, with the approval of the Secretary, an incentive re- payment program designed to reduce default and to replenish student loan funds established under this part.
Each such in- centive repayment program may— (A) offer a reduction of the interest rate on a loan on which the borrower has made 48 consecutive, monthly re- payments, but in no event may the rate be reduced by more than 1 percent; (B) provide for a discount on the balance owed on a loan on which the borrower pays the principal and interest in full prior to the end of the applicable repayment period, but in no event may the discount exceed 5 percent of the unpaid principal balance due on the loan at the time the early repayment is made; and (C) include such other incentive repayment options as the institution determines will carry out the objectives of this subsection.
(2) LIMITATION.—No incentive repayment option under an incentive repayment program authorized by this subsection may be paid for with Federal funds, including any Federal funds from the student loan fund, or with institutional funds from the student loan fund.
(j) ARMED FORCES AND NOAA COMMISSIONED OFFICER CORPS STUDENT LOAN INTEREST PAYMENT PROGRAMS.— (1) AUTHORITY.—Using funds received by transfer to the Secretary under section 2174 of title 10, United States Code, or section 268 of the National Oceanic and Atmospheric Ad- ministration Commissioned Officer Corps Act of 2002 for the payment of interest on a loan made under this part to a mem- ber of the Armed Forces or an officer in the commissioned offi- cer corps of the National Oceanic and Atmospheric Administra- tion, respectively, the Secretary shall pay the interest on the loan as due for a period not in excess of 36 consecutive months.
The Secretary may not pay interest on such a loan out of any funds other than funds that have been so transferred.

(2) FORBEARANCE.—During the period in which the Sec- retary is making payments on a loan under paragraph (1), the institution of higher education shall grant the borrower for- bearance in accordance with subsection (e)(1)(C).
(k) The Secretary may develop such additional safeguards as the Secretary determines necessary to prevent fraud and abuse in the cancellation of liability under subsection (c)(1)(F).

Notwith- standing subsection (c)(1)(F), the Secretary may promulgate regula- September 8, 2023 As Amended Through P.L.

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465 HIGHER EDUCATION ACT OF 1965 530 tions to resume collection on loans cancelled under subsection (c)(1)(F) in any case in which— (1) a borrower received a cancellation of liability under subsection (c)(1)(F) and after the cancellation the borrower— (A) receives a loan made, insured, or guaranteed under this title; or (B) has earned income in excess of the poverty line; or (2) the Secretary determines necessary.

SEC.

465. ø20 U.S.C.

1087ee¿ CANCELLATION OF LOANS FOR CERTAIN PUBLIC SERVICE.
(a) CANCELLATION OF PERCENTAGE OF DEBT BASED ON YEARS OF QUALIFYING SERVICE.—(1) The percent specified in paragraph (3) of this subsection of the total amount of any loan made after June 30, 1972, from a student loan fund assisted under this part shall be canceled for each complete year of service after such date by the borrower under circumstances described in paragraph (2).
(2) Loans shall be canceled under paragraph (1) for service— (A) as a full-time teacher for service in an academic year (including such a teacher employed by an educational service agency)— (i) in a public or other nonprofit private elementary school or secondary school, which, for the purpose of this paragraph and for that year— (I) has been determined by the Secretary (pursu- ant to regulations of the Secretary and after consulta- tion with the State educational agency of the State in which the school is located) to be a school in which the number of children meeting a measure of poverty under section 1113(a)(5) of the Elementary and Sec- ondary Education Act of 1965, exceeds 30 percent of the total number of children enrolled in such school; and (II) is in the school district of a local educational agency which is eligible in such year for assistance pursuant to part A of title I of the Elementary and Secondary Education Act of 1965; or (ii) in one or more public, or nonprofit private, elemen- tary schools or secondary schools or locations operated by an educational service agency that have been determined by the Secretary (pursuant to regulations of the Secretary and after consultation with the State educational agency of the State in which the educational service agency oper- ates) to be a school or location at which the number of chil- dren taught who meet a measure of poverty under section 1113(a)(5) of the Elementary and Secondary Education Act of 1965, exceeds 30 percent of the total number of children taught at such school or location; (B) as a full-time staff member in a preschool program car- ried on under the Head Start Act, or in a prekindergarten or child care program that is licensed or regulated by the State, that is operated for a period which is comparable to a full school year in the locality if the salary of such staff member is not more than the salary of a comparable employee of the local educational agency; September 8, 2023 As Amended Through P.L.
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465 (C) as a full-time special education teacher, including teachers of infants, toddlers, children, or youth with disabil- ities in a public or other nonprofit elementary or secondary school system, including a system administered by an edu- cational service agency, or as a full-time qualified professional provider of early intervention services in a public or other non- profit program under public supervision by the lead agency as authorized in section 635(a)(10) of the Individuals with Disabil- ities Education Act; (D) as a member of the Armed Forces of the United States, for service that qualifies for special pay under section 310, or paragraph (1) or (3) of section 351(a), of title 37, United States Code, as an area of hostilities; (E) as a volunteer under the Peace Corps Act or a volun- teer under the Domestic Volunteer Service Act of 1973; (F) as a full-time law enforcement officer or corrections of- ficer for service to local, State, or Federal law enforcement or corrections agencies, or as a full-time attorney employed in a defender organization established in accordance with section 3006A(g)(2)of title 18, United States Code; (G) as a full-time teacher of mathematics, science, foreign languages, bilingual education, or any other field of expertise where the State educational agency determines there is a shortage of qualified teachers; (H) as a full-time nurse or medical technician providing health care services; (I) as a full-time employee of a public or private nonprofit child or family service agency who is providing, or supervising the provision of, services to high-risk children who are from low-income communities and the families of such children; (J) as a full-time fire fighter for service to a local, State, or Federal fire department or fire district; (K) as a full-time faculty member at a Tribal College or University, as that term is defined in section 316; (L) as a librarian, if the librarian has a master’s degree in library science and is employed in— (i) an elementary school or secondary
 school that is eli- gible for assistance under part A of title I of the Elemen- tary and Secondary Education Act of 1965; or (ii) a public library that serves a geographic area that contains one or more schools eligible for assistance under part A of title I of the Elementary and Secondary Edu- cation Act of 1965; or (M) as a full-time speech language pathologist, if the pa- thologist has a masters degree and is working exclusively with schools that are eligible for assistance under title I of the Ele- mentary and Secondary Education Act of 1965.
For the purpose of this paragraph, the term ‘‘children with disabil- ities’’ has the meaning set forth in section 602 of the Individuals with Disabilities Education Act.

(3)(A) The percent of a loan which shall be canceled under paragraph (1) of this subsection is— (i) in the case of service described in subparagraph (A), (C), (D), (F), (G), (H), (I), (J), (K), (L), or (M) of paragraph (2), September 8, 2023 As Amended Through P.L.
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465 HIGHER EDUCATION ACT OF 1965 532 at the rate of 15 percent for the first or second year of such service, 20 percent for the third or fourth year of such service, and 30 percent for the fifth year of such service; (ii) in the case of service described in subparagraph (B) of paragraph (2), at the rate of 15 percent for each year of such service; or (iii) in the case of service described in subparagraph (E) of paragraph (2) at the rate of 15 percent for the first or second year of such service and 20 percent for the third or fourth year of such service.
(B) If a portion of a loan is canceled under this subsection for any year, the entire amount of interest on such loan which accrues for such year shall be canceled.

(C) Nothing in this subsection shall be construed to authorize refunding of any repayment of a loan.

(4) For the purpose of this subsection, the term ‘‘year’’ where applied to service as a teacher means academic year as defined by the Secretary.
(5) The amount of a loan, and interest on a loan, which is can- celed under this section shall not be considered income for purposes of the Internal Revenue Code of 1986.

(6) No borrower may, for the same volunteer service, receive a benefit under both this section and subtitle D of title I of the Na- tional and Community Service Act of 1990 (42 U.S.C.

12601 et seq.).
(7) An individual with an outstanding loan obligation under this part who performs service of any type that is described in paragraph (2) as in effect on the date of enactment of this para- graph shall be eligible for cancellation under this section for such service notwithstanding any contrary provision of the promissory note under which the loan or loans were made, and notwith- standing any amendment (or effective date provision relating to any amendment) to this section made prior to the date of such service.
(b) REIMBURSEMENT FOR CANCELLATION.—The Secretary shall pay to each institution for each fiscal year an amount equal to the aggregate of the amounts of loans from its student loan fund which are canceled pursuant to this section for such year, minus an amount equal to the aggregate of the amounts of any such loans so canceled which were made from Federal capital contributions to its student loan fund provided by the Secretary under section 468.
None of the funds appropriated pursuant to section 461(b) shall be available for payments pursuant to this subsection.

To the extent feasible, the Secretary shall pay the amounts for which any institu- tion qualifies under this subsection not later than 3 months after the institution files an institutional application for campus-based funds.
(c) SPECIAL RULES.— (1) LIST.—If the list of schools in which a teacher may per- form service pursuant to subsection (a)(2)(A) is not available before May 1 of any year, the Secretary may use the list for the year preceding the year for which the determination is made to make such service determination.

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466 (2) CONTINUING ELIGIBILITY.—Any teacher who performs service in a school which— any year; and (A) meets the requirements of subsection (a)(2)(A) in (B) in a subsequent year fails to meet the require- ments of such subsection, may continue to teach in such school and shall be eligible for loan cancellation pursuant to subsection (a)(1) such subsequent years.

SEC.

466. ø20 U.S.C.

1087ff¿ DISTRIBUTION OF ASSETS FROM STUDENT LOAN FUNDS.
(a) IN GENERAL.—Beginning October 1, 2017, there shall be a capital distribution of the balance of the student loan fund estab- lished under this part by each institution of higher education as follows: (1) The Secretary shall first be paid an amount which bears the same ratio to the balance in such fund at the close of September 30, 2017, as the total amount of the Federal cap- ital contributions to such fund by the Secretary under this part bears to the sum of such Federal contributions and the institu- tion’s capital contributions to such fund.
(2) The remainder of such balance shall be paid to the in- stitution.
(b) DISTRIBUTION OF LATE COLLECTIONS.—Beginning October 1, 2017, each institution with which the Secretary has made an agreement under this part, shall pay to the Secretary the same proportionate share of amounts received by this institution after September 30, 2017, in payment of principal and interest on stu- dent loans made from the student loan fund established pursuant to such agreement (which amount shall be determined after deduc- tion of any costs of litigation incurred in collection of the principal or interest on loans from the fund and not already reimbursed from the fund or from such payments of principal or interest), as was de- termined for the Secretary under subsection (a).
(c) DISTRIBUTION OF EXCESS CAPITAL.—(1) Upon a finding by the institution or the Secretary prior to October 1, 2017, that the liquid assets of a student loan fund established pursuant to an agreement under this part exceed the amount required for loans or otherwise in the foreseeable future, and upon notice to such institu- tion or to the Secretary, as the case may be, there shall be, subject to such limitations as may be included in regulations of the Sec- retary or in such agreement, a capital distribution from such fund.
Such capital distribution shall be made as follows: (A) The Secretary shall first be paid an amount which bears the same ratio to the total to be distributed as the Fed- eral capital contributions by the Secretary to the student loan fund prior to such distribution bear to the sum of such Federal capital contributions and the capital contributions to the fund made by the institution.

(B) The remainder of the capital distribution shall be paid to the institution.
(2) No finding that the liquid assets of a student loan fund es- tablished under this part exceed the amount required under para- graph (1) may be made prior to a date which is 2 years after the September 8, 2023 As Amended Through P.L.

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467 HIGHER EDUCATION ACT OF 1965 534 date on which the institution of higher education received the funds from such institution’s allocation under section 462.

SEC.

467. ø20 U.S.C.

1087gg¿ COLLECTION OF DEFAULTED LOANS: PER- KINS LOAN REVOLVING FUND.
(a) AUTHORITY OF SECRETARY TO COLLECT REFERRED, TRANS- FERRED, OR ASSIGNED LOANS.—With respect to any loan— (1) which was made under this part, and (2) which is referred, transferred, or assigned to the Sec- retary by an institution with an agreement under section 463(a), the Secretary is authorized to attempt to collect such loan by any means authorized by law for collecting claims of the United States (including referral to the Attorney General for litigation) and under such terms and conditions as the Secretary may prescribe, includ- ing reimbursement for expenses reasonably incurred in attempting such collection.
(b) COLLECTION OF REFERRED, TRANSFERRED, OR ASSIGNED LOANS.—The Secretary shall continue to attempt to collect any loan referred, transferred, or assigned under paragraph (4) or (5) of sec- tion 463(a) until all appropriate collection efforts, as determined by the Secretary, have been expended.

SEC.

468. ø20 U.S.C.

1087hh¿ GENERAL AUTHORITY OF SECRETARY.
In carrying out the provisions of this part, the Secretary is au- thorized— (1) to consent to modification, with respect to rate of inter- est, time of payment of any installment of principal and inter- est or any portion thereof, or any other provision of any note evidencing a loan which has been made under this part; (2) to enforce, pay, compromise, waive, or release any right, title, claim, lien, or demand, however acquired, including any equity or any right of redemption; (3) to conduct litigation in accordance with the provisions of section 432(a)(2); and (4) to enter into a contract or other arrangement with State or nonprofit agencies and, on a competitive basis, with collection agencies for servicing and collection of loans under this part.
SEC.

469. ø20 U.S.C.

1087ii¿ DEFINITIONS.

(a) LOW-INCOME COMMUNITIES.—For the purpose of this part, the term ‘‘low-income communities’’ means communities in which there is a high concentration of children eligible to be counted under section 1124(c) of the Elementary and Secondary Education Act of 1965.
(b) HIGH-RISK CHILDREN.—For the purposes of this part, the term ‘‘high-risk children’’ means individuals under the age of 21 who are low-income or at risk of abuse or neglect, have been abused or neglected, have serious emotional, mental, or behavioral disturbances, reside in placements outside their homes, or are in- volved in the juvenile justice system.
(c) INFANTS, TODDLERS, CHILDREN, AND YOUTH WITH DISABIL- ITIES.—For purposes of this part, the term ‘‘infants, toddlers, chil- dren, and youth with disabilities’’ means children with disabilities and infants and toddlers with disabilities as defined in sections 602 September 8, 2023 As Amended Through P.L.
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472 and 632, respectively, of the Individuals with Disabilities Edu- cation Act, and the term ‘‘early intervention services’’ has the meaning given the term in section 632 of such Act.

PART F—NEED ANALYSIS 55 SEC.

471. ø20 U.S.C.

1087kk¿ AMOUNT OF NEED.


Except as otherwise provided therein, the amount of need of any student for financial assistance under this title (except sub- parts 1 or 2 of part A) is equal to— (1) the cost of attendance of such student, minus (2) the expected family contribution for such student, minus (3) estimated financial assistance not received under this title (as defined in section 480(j)).
øNote: For currency of the version of section 471, see footnote that appears at the heading of part F of this title.

Upon such date, section 471 (as amended, including an amendment made by section 102(b)(2) of division R of Public Law 117–103) will read as follows: ¿ SEC.

471. ƒ20 U.S.C.

1087kk≈ AMOUNT OF NEED.


Except as otherwise provided therein, for award year 2024–2025 and each subsequent award year, the amount of need of any student for financial assistance under this title (except subpart 1 or 2 of part A) is equal to— (1) the cost of attendance of such student, minus (2) the student aid index (as defined in section 473) for such student, minus (as defined in section 480(i)).

(3) other financial assistance not received under this title SEC.

472. ø20 U.S.C.
472. ø20 U.S.C.

1087ll¿ COST OF ATTENDANCE.
For the purpose of this title, the term ‘‘cost of attendance’’ means— (1) tuition and fees normally assessed a student carrying the same academic workload as determined by the institution, and including costs for rental or purchase of any equipment, materials, or supplies required of all students in the same course of study; (2) an allowance for books, supplies, transportation, and miscellaneous personal expenses, including a reasonable allow- ance for the documented rental or purchase of a personal com- puter, for a student attending the institution on at least a half- time basis, as determined by the institution; 55 Effective on July 1, 2024, subsections (a)(1) and (b) through (l) of section 702 of division FF of Public Law 116-260 provide for amendments to strike sections 471 through 480 and insert new sections 471 through 480.
For a version of these sections, as amended and effective begin- ning on July 1, 2024 (pursuant to section 701(b) of such Public Law), see matter set out in italic typeface and bracketed notes.

See section 102(c) of Public 117-103 for select amendments made by Public Law 116-260 (as amended by P.L.

117-103) to sections 472, 479A, 479D, and 480 where the Secretary of Edu- cation may implement for certain purposes on or after July 1, 2023, but not lather than July 1, 2024.
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472 HIGHER EDUCATION ACT OF 1965 536 (3) an allowance (as determined by the institution) for room and board costs incurred by the student which— (A) shall be an allowance determined by the institu- tion for a student without dependents residing at home with parents; (B) for students without dependents residing in insti- tutionally owned or operated housing, shall be a standard allowance determined by the institution based on the amount normally assessed most of its residents for room and board; (C) for students who live in housing located on a mili- tary base or for which a basic allowance is provided under section 403(b) of title 37, United States Code, shall be an allowance based on the expenses reasonably incurred by such students for board but not for room; and (D) for all other students shall be an allowance based on the expenses reasonably incurred by such students for room and board; (4) for less than half-time students (as determined by the institution), tuition and fees and an allowance for only— (A) books, supplies, and transportation (as determined by the institution); (B) dependent care expenses (determined in accord- ance with paragraph (8)); and (C) room and board costs (determined in accordance with paragraph (3)), except that a student may receive an allowance for such costs under this subparagraph for not more than 3 semesters or the equivalent, of which not more than 2 semesters or the equivalent may be consecu- tive; (5) for a student engaged in a program of study by cor- respondence, only tuition and fees and, if required, books and supplies, travel, and room and board costs incurred specifically in fulfilling a required period of residential training; (6) for incarcerated students only tuition and fees and, if required, books and supplies; (7) for a student enrolled in an academic program in a pro- gram of study abroad approved for credit by the student’s home institution, reasonable costs associated with such study (as determined by the institution at which such student is en- rolled); (8)
 for a student with one or more dependents, an allow- ance based on the estimated actual expenses incurred for such dependent care, based on the number and age of such depend- ents, except that— (A) such allowance shall not exceed the reasonable cost in the community in which such student resides for the kind of care provided; and (B) the period for which dependent care is required in- cludes, but is not limited to, class-time, study-time, field work, internships, and commuting time; (9) for a student with a disability, an allowance (as deter- mined by the institution) for those expenses related to the stu- dent’s disability, including special services, personal assistance, September 8, 2023 As Amended Through P.L.
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472 transportation, equipment, and supplies that are reasonably incurred and not provided for by other assisting agencies; (10) for a student receiving all or part of the student’s in- struction by means of telecommunications technology, no dis- tinction shall be made with respect to the mode of instruction in determining costs; (11) for a student engaged in a work experience under a cooperative education program, an allowance for reasonable costs associated with such employment (as determined by the institution); (12) for a student who receives a loan under this or any other Federal law, or, at the option of the institution, a conven- tional student loan incurred by the student to cover a student’s cost of attendance at the institution, an allowance for the ac- tual cost of any loan fee, origination fee, or insurance premium charged to such student or such parent on such loan, or the av- erage cost of any such fee or premium charged by the Sec- retary, lender, or guaranty agency making or insuring such loan, as the case may be; and (13) at the option of the institution, for a student in a pro- gram requiring professional licensure or certification, the one- time cost of obtaining the first professional credentials (as de- termined by the institution).
øNote: For currency of the version of section 472, see footnote that appears at the heading of part F of this title.

Upon such date, section 472 (as amended, including an amendment made by section 103(a) of division R of Public Law 117–103) will read as follows:¿ SEC.

472.

COST OF ATTENDANCE.
(a) IN GENERAL.—For the purpose of this title, the term ‘‘cost of attendance’’ means— (1) tuition and fees normally assessed a student carrying the same academic workload as determined by the institution; (2) an allowance for books, course materials, supplies, and equipment, which shall include all such costs required of all such students in the same course of study, including a reason- able allowance for the documented rental or upfront purchase of a personal computer, as determined by the institution; (3) an allowance for transportation, which may include transportation between campus, residences, and place of work, as determined by the institution; (4) an allowance for miscellaneous personal expenses, for a student attending the institution on at least a half-time basis, as determined by the institution; (5) an allowance for living expenses, including food and housing costs, to be incurred by the student attending the insti- tution on at least a half-time basis, as determined by the insti- tution, which shall include— (A) for a student electing institutionally owned or oper- ated food services, such as board or meal plans, a standard allowance for such services that provides the equivalent of three meals each day; September 8, 2023 As Amended Through P.L.
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472 HIGHER EDUCATION ACT OF 1965 538 (B) for a student not electing institutionally owned or operated food services, such as board or meal plans, a standard allowance for purchasing food off campus that provides the equivalent of three meals each day; (C) for a student without dependents residing in insti- tutionally owned or operated housing, a standard allow- ance determined by the institution based on the average or median amount assessed to such residents for housing charges, whichever is greater; (D) for a student with dependents residing in institu- tionally owned or operated housing, a standard allowance determined by the institution based on the average or me- dian amount assessed to such residents for housing charges, whichever is greater; (E) for a student living off campus, and not in institu- tionally owned or operated housing, a standard allowance for rent or other housing costs; (F) for a dependent student residing at home with par- ents, a standard allowance that shall not be zero deter- mined by the institution; (G) for a student living in housing located on a mili- tary base or for which a basic allowance is provided under section 403(b) of title 37, United States Code, a standard allowance for food based upon such student’s choice of pur- chasing food on-campus or off-campus (determined respec- tively in accordance with subparagraph (A) or (B)), but not for housing costs; and (H) for all other students, an allowance based on the expenses reasonably incurred by such students for housing and food; (6) for a student engaged in a program of study by cor- respondence, only tuition and fees and, if required, books and supplies, travel, and housing and food costs incurred specifi- cally in fulfilling a required period of residential training; (7) for a confined or incarcerated student, only tuition, fees, books, course materials, supplies, equipment, and the cost of ob- taining a license, certification, or a first professional credential in accordance with paragraph (14); (8) for a student enrolled in
 an academic program in a pro- gram of study abroad approved for credit by the student’s home institution, reasonable costs associated with such study (as de- termined by the institution at which such student is enrolled); (9) for a student with one or more dependents, an allow- ance based on the estimated actual expenses incurred for such dependent care, based on the number and age of such depend- ents, except that— (A) such allowance shall not exceed the reasonable cost in the community in which such student resides for the kind of care provided; and (B) the period for which dependent care is required in- cludes, but is not limited to, class-time, study-time, field work, internships, and commuting time; (10) for a student with a disability, an allowance (as deter- mined by the institution) for those expenses related to the stu- September 8, 2023 As Amended Through P.L.
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473 dent’s disability, including special services, personal assistance, transportation, equipment, and supplies that are reasonably in- curred and not provided for by other assisting agencies; (11) for a student receiving all or part of the student’s in- struction by means of telecommunications technology, no dis- tinction shall be made with respect to the mode of instruction in determining costs; (12) for a student engaged in a work experience under a co- operative education program, an allowance for reasonable costs associated with such employment (as determined by the institu- tion); (13) for a student who receives a Federal student loan made under this title or any other Federal law, to cover a stu- dent’s cost of attendance at the institution, an allowance for the actual cost of any loan fee, origination fee, or insurance pre- mium charged to such student or the parent of such student on such loan, or the average cost of any such fee or premium, as applicable; and (14) for a student in a program requiring professional li- censure, certification, or a first professional credential, the cost of obtaining the license, certification, or a first professional cre- dential.
(b) SPECIAL RULE FOR LIVING EXPENSES FOR LESS-THAN-HALF- TIME STUDENTS.—For students attending an institution of higher education less than half-time, an institution of higher education may include an allowance for living expenses, including food and housing costs in accordance with subsection (a)(4) for up to three se- mesters, or the equivalent, with no more than two semesters being consecutive.
(c) DISCLOSURE OF COST OF ATTENDANCE ELEMENTS.—Each in- stitution shall make publicly available on the institution’s website a list of all the elements of cost of attendance described in para- graphs (1) through (14) of subsection (a), and shall disclose such elements on any portion of the website describing tuition and fees of the institution.

SEC.

473. ø20 U.S.C.

1087mm¿ FAMILY CONTRIBUTION.


(a) IN GENERAL.—For the purpose of this title, other than sub- part 2 of part A, and except as provided in subsection (b), the term ‘‘family contribution’’ with respect to any student means the amount which the student and the student’s family may be reason- ably expected to contribute toward the student’s postsecondary edu- cation for the academic year for which the determination is made, as determined in accordance with this part.
(b) SPECIAL RULE.— (1) IN GENERAL.—Notwithstanding any other provision of this title, the family contribution of each student described in paragraph (2) shall be deemed to be zero for the academic year for which the determination is made.
(2) APPLICABILITY.—Paragraph (1) shall apply to any de- pendent or independent student with respect to determinations of need for academic year 2009–2010 (in the case of a student who meets the requirement of subparagraph (B)(i)), or aca- demic year 2018–2019 (in the case of a student who meets the September 8, 2023 As Amended Through P.L.
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473 HIGHER EDUCATION ACT OF 1965 540 requirement of subparagraph (B)(ii)), and succeeding academic years— (A) who is eligible to receive a Federal Pell Grant for the academic year for which the determination is made; (B) whose parent or guardian was— (i) a member of the Armed Forces of the United States and died as a result of performing military service in Iraq or Afghanistan after September 11, 2001; or (ii) actively serving as a public safety officer and died in the line of duty while performing as a public safety officer; and (C) who, at the time of the parent or guardian’s death, was— (i) less than 24 years of age; or (ii) enrolled at an institution of higher education on a part-time or full-time basis.
(3) INFORMATION.— (A) ARMED FORCES.—Notwithstanding any other provi- sion of law, the Secretary of Veterans Affairs and the Sec- retary of Defense, as appropriate, shall provide the Sec- retary of Education with information necessary to deter- mine which students meet the requirements of subpara- graphs (A), (B)(i), and (C) of paragraph (2).
(B) PUBLIC SAFETY OFFICERS.—Notwithstanding any other provision of law, unless the Secretary establishes an alternate method to adjust the expected family contribu- tion, for each student who meets the requirements of sub- paragraphs (A), (B)(ii), and (C) of paragraph (2), a finan- cial aid administrator shall— (i) verify with the student that the student is eli- gible for the adjustment; (ii) adjust the expected family contribution in ac- cordance with this subsection; and (iii) notify the Secretary of the adjustment and the student’s eligibility for the adjustment.
(4) TREATMENT OF PELL AMOUNT.—Notwithstanding sec- tion 1212 of the Omnibus Crime Control and Safe Streets Act of 1968 (42 U.S.C.
3796d–1), in the case of a student who re- ceives an increased Federal Pell Grant amount under this sec- tion, the total amount of such Federal Pell Grant, including the increase under this subsection, shall not be considered in cal- culating that student’s educational assistance benefits under the Public Safety Officers’ Benefits program under subpart 2 of part L of title I of such Act.
(5) DEFINITION OF PUBLIC SAFETY OFFICER.—For purposes of this subsection, the term ‘‘public safety officer’’ means— (A) a public safety officer, as defined in section 1204 of title I of the Omnibus Crime Control and Safe Streets Act of 1968 (42 U.S.C.

3796b); or (B) a fire police officer, defined as an individual who— (i) is serving in accordance with State or local law as an officially recognized or designated member of a legally organized public safety agency; September 8, 2023 As Amended Through P.L.
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474 (ii) is not a law enforcement officer, a firefighter, a chaplain, or a member of a rescue squad or ambu- lance crew; and (iii) provides scene security or directs traffic— (I) in response to any fire drill, fire call, or other fire, rescue, or police emergency; or (II) at a planned special event.

øNote: For currency of the version of section 473, see footnote that appears at the heading of part F of this title.¿ SEC.

473. ƒ20 U.S.C.

1087mm≈ SPECIAL RULES FOR STUDENT AID INDEX.


(a) IN GENERAL.—For the purpose of this Act, the term ‘‘student aid index’’ means, with respect to a student, an index that reflects an evaluation of a student’s approximate financial resources to con- tribute toward the student’s postsecondary education for the aca- demic year, as determined in accordance with this part.
(b) SPECIAL RULE FOR STUDENTS ELIGIBLE FOR THE TOTAL MAXIMUM PELL GRANT.—The Secretary shall consider an applicant to automatically have a student aid index equal to zero if the appli- cant is eligible for the total maximum Federal Pell Grant under sec- tion 401(b)(1)(A), except that, if the applicant has a calculated stu- dent aid index of less than zero the Secretary shall consider the neg- ative number as the student aid index for the applicant.
(c) SPECIAL RULE FOR NONFILERS.—Notwithstanding sub- section (b), for an applicant (or, as applicable, an applicant and spouse, or an applicant’s parents) who is not required to file a Fed- eral tax return for the second preceding tax year, the Secretary shall for the purposes of this title consider the student aid index as equal to – $1,500 for the applicant.

SEC.

474. ø20 U.S.C.

1087nn¿ DETERMINATION OF EXPECTED FAMILY CONTRIBUTION; DATA ELEMENTS.
(a) GENERAL RULE FOR DETERMINATION OF EXPECTED FAMILY CONTRIBUTION.—The expected family contribution— (1) for a dependent student shall be determined in accord- ance with section 475; (2) for a single independent student or a married inde- pendent student without dependents (other than a spouse) shall be determined in accordance with section 476; and (3) for an independent student with dependents other than a spouse shall be determined in accordance with section 477.
(b) DATA ELEMENTS.—The following data elements are consid- ered in determining the expected family contribution: (1) the available income of (A) the student and the stu- dent’s spouse, or (B) the student and the student’s parents, in the case of a dependent student; (2) the number of dependents in the family of the student; (3) the number of dependents in the family of the student, excluding the student’s parents, who are enrolled or accepted for enrollment, on at least a half-time basis, in a degree, cer- tificate, or other program leading to a recognized educational credential at an institution of higher education that is an eligi- ble institution in accordance with the provisions of section 487 September 8, 2023 As Amended Through P.L.
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474 HIGHER EDUCATION ACT OF 1965 542 and for whom the family may reasonably be expected to con- tribute to their postsecondary education; (4) the net assets of (A) the student and the student’s spouse, and (B) the student and the student’s parents, in the case of a dependent student; (5) the marital status of the student; (6) the age of the older parent, in the case of a dependent student, and the student; and (7) the additional expenses incurred (A) in the case of a de- pendent student, when both parents of the student are em- ployed or when the family is headed by a single parent who is employed, or (B) in the case of an independent student, when the student is married and the student’s spouse is employed, or when the employed student qualifies as a surviving spouse or as a head of a household under section 2 of the Internal Revenue Code of 1986. øNote: For currency of the version of section 474, see footnote that appears at the heading of part F of this title.¿ SEC.
474. ƒ20 U.S.C.

1087nn≈ DETERMINATION OF STUDENT AID INDEX.

The student aid index— (1) for a dependent student shall be determined in accord- ance with section 475; (2) for a single independent student or a married inde- pendent student without dependents (other than a spouse) shall be determined in accordance with section 476; and (3) for an independent student with dependents other than a spouse shall be determined in accordance with section 477.

SEC.

475. ø20 U.S.C.


1087oo¿ FAMILY CONTRIBUTION FOR DEPENDENT STUDENTS.
(a) COMPUTATION OF EXPECTED FAMILY CONTRIBUTION.—For each dependent student, the expected family contribution is equal to the sum of— (1) the parents’ contribution from adjusted available in- come (determined in accordance with subsection (b)); (2) the student contribution from available income (deter- mined in accordance with subsection (g)); and (3) the student contribution from assets (determined in ac- cordance with subsection (h)).
(b) PARENTS’ CONTRIBUTION FROM ADJUSTED AVAILABLE IN- COME.—The parents’ contribution from adjusted available income is equal to the amount determined by— (1) computing adjusted available income by adding— (A) the parents’ available income (determined in ac- cordance with subsection (c)); and (B) the parents’ contribution from assets (determined in accordance with subsection (d)); (2) assessing such adjusted available income in accordance with the assessment schedule set forth in subsection (e); and (3) dividing the assessment resulting under paragraph (2) by the number of the family members, excluding the student’s parents, who are enrolled or accepted for enrollment, on at September 8, 2023 As Amended Through P.L.
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475 least a half-time basis, in a degree, certificate, or other pro- gram leading to a recognized educational credential at an insti- tution of higher education that is an eligible institution in ac- cordance with the provisions of section 487 during the award period for which assistance under this title is requested; except that the amount determined under this subsection shall not be less than zero.
(c) PARENTS’ AVAILABLE INCOME.— (1) IN GENERAL.—The parents’ available income is deter- mined by deducting from total income (as defined in section 480)— (A) Federal income taxes; (B) an allowance for State and other taxes, determined in accordance with paragraph (2); (C) an allowance for social security taxes, determined in accordance with paragraph (3); (D) an income protection allowance, determined in ac- cordance with paragraph (4); (E) an employment expense allowance, determined in accordance with paragraph (5); and (F) the amount of any tax credit taken by the parents under section 25A of the Internal Revenue Code of 1986.
(2) ALLOWANCE FOR STATE AND OTHER TAXES.—The allow- ance for State and other taxes is equal to an amount deter- mined by multiplying total income (as defined in section 480) by a percentage determined according to the following table (or a successor table prescribed by the Secretary under section 478): Percentages for Computation of State and Other Tax Allowance If parents’ State or territory of residence is— And parents’ total income is— less than $15,000 or $15,000 or more then the percentage is— Alaska, Puerto Rico, Wyoming .................................................. American Samoa, Guam, Louisiana, Nevada, Texas, Trust Territory, Virgin Islands ........................................................ Florida, South Dakota, Tennessee, New Mexico ...................... North Dakota, Washington ........................................................ Alabama, Arizona, Arkansas, Indiana, Mississippi, Missouri, Montana, New Hampshire, Oklahoma, West Virginia ........ Colorado, Connecticut, Georgia, Illinois, Kansas, Kentucky ... California, Delaware, Idaho, Iowa, Nebraska, North Caro- lina, Ohio, Pennsylvania, South Carolina, Utah, Vermont, Virginia, Canada, Mexico ....................................................... Maine, New Jersey ..................................................................... District of Columbia, Hawaii, Maryland, Massachusetts, Or- egon, Rhode Island .................................................................. Michigan, Minnesota .................................................................. September 8, 2023 As Amended Through P.L.
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475 HIGHER EDUCATION ACT OF 1965 544 Percentages for Computation of State and Other Tax Allowance—Continued If parents’ State or territory of residence is— And parents’ total income is— less than $15,000 or $15,000 or more Wisconsin .................................................................................... New York ..................................................................................... Other ............................................................................................ 13 14 9 12 13 8 (3) ALLOWANCE FOR SOCIAL SECURITY TAXES.—The allow- ance for social security taxes is equal to the amount earned by each parent multiplied by the social security withholding rate appropriate to the tax year of the earnings, up to the max- imum statutory social security tax withholding amount for that same tax year.
(4) INCOME PROTECTION ALLOWANCE.—The income protec- tion allowance is determined by the following table (or a suc- cessor table prescribed by the Secretary under section 478): September 8, 2023 As Amended Through P.L.

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475 Income Protection Allowance Family Size Number in College (including student) For each additional add: $10,520 $8,720 13,100 11,310 $9,510 16,180 14,380 12,590 $10,790 19,090 17,290 15,500 22,330 20,530 18,740 13,700 $11,910 15,150 16,940 2,520 2,520 2,520 2,520 2,520 For each addi- tional sub- tract: $1,790 (5) EMPLOYMENT EXPENSE ALLOWANCE.—The employment expense allowance is determined as follows (or using a suc- cessor provision prescribed by the Secretary under section 478): (A) If both parents were employed in the year for which their income is reported and both have their in- comes reported in determining the expected family con- tribution, such allowance is equal to the lesser of $2,500 or 35 percent of the earned income of the parent with the lesser earned income.
(B) If a parent qualifies as a surviving spouse or as a head of household as defined in section 2 of the Internal Revenue Code of 1986, such allowance is equal to the less- er of $2,500 or 35 percent of such parent’s earned income.
(d) PARENTS’ CONTRIBUTION FROM ASSETS.— (1) IN GENERAL.—The parents’ contribution from assets is equal to— (A) the parental net worth (determined in accordance with paragraph (2)); minus (B) the education savings and asset protection allow- ance (determined in accordance with paragraph (3)); multi- plied by (C) the asset conversion rate (determined in accord- ance with paragraph (4)), except that the result shall not be less than zero.

September 8, 2023 As Amended Through P.L.


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475 HIGHER EDUCATION ACT OF 1965 546 (2) PARENTAL NET WORTH.—The parental net worth is cal- culated by adding— (A) the current balance of checking and savings ac- counts and cash on hand; (B) the net value of investments and real estate, ex- cluding the net value of the principal place of residence; and (C) the adjusted net worth of a business or farm, com- puted on the basis of the net worth of such business or farm (hereafter in this subsection referred to as ‘‘NW’’), de- termined in accordance with the following table (or a suc- cessor table prescribed by the Secretary under section 478), except as provided under section 480(f): Adjusted Net Worth of a Business or Farm If the net worth of a business or farm is— Then the adjusted net worth is: Less than $1 .............................................. $0 $1–$75,000 ................................................. 40 percent of NW $75,001–$225,000 ...................................... $30,000 plus 50 percent of NW over $75,000 $225,001–$375,000 .................................... $105,000 plus 60 percent of NW over $225,000 $375,001 or more ....................................... $195,000 plus 100 percent of NW over $375,000 (3) EDUCATION SAVINGS AND ASSET PROTECTION ALLOW- ANCE.—The education savings and asset protection allowance is calculated according to the following table (or a successor table prescribed by the Secretary under section 478): September 8, 2023 As Amended Through P.L.
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475 Education Savings and Asset Protection Allowances for Families and Students If the age of the oldest parent is— And there are two parents one parent then the allowance is— 25 or less .................................................................... 26 ................................................................................ 27 ................................................................................ 28 ................................................................................ 29 ................................................................................ 30 ................................................................................ 31 ................................................................................ 32 ................................................................................ 33 ................................................................................ 34 ................................................................................ 35 ................................................................................ 36 ................................................................................ 37 ................................................................................ 38 ................................................................................ 39 ................................................................................ 40 ................................................................................ 41 ................................................................................ 42 ................................................................................ 43 ................................................................................ 44 ................................................................................ 45 ................................................................................ 46 ................................................................................ 47 ................................................................................ 48 ................................................................................ 49 ................................................................................ 50 ................................................................................ 51 ................................................................................ 52 ................................................................................ 53 ................................................................................ 54 ................................................................................ 55 ................................................................................ 56 ................................................................................ 57 ................................................................................ 58 ................................................................................ 59 ................................................................................ 60 ................................................................................ 61 ................................................................................ 62 ................................................................................ 63 ................................................................................ 64 ................................................................................ 65 or more .................................................................. $ $ (4) ASSET CONVERSION RATE.—The asset conversion rate is 12 percent.
(e) ASSESSMENT SCHEDULE.—The adjusted available income (as determined under subsection (b)(1) and hereafter in this subsection referred to as ‘‘AAI’’) is assessed according to the following table (or a successor table prescribed by the Secretary under section 478): September 8, 2023 As Amended Through P.L.

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475 HIGHER EDUCATION ACT OF 1965 548 Parents’ Assessment From Adjusted Available Income (AAI) If AAI is— Then the assessment is— Less than ¥$3,409 .................................... ¥$750 ¥$3,409 to $9,400 ..................................... 22% of AAI $9,401 to $11,800 ...................................... $2,068 + 25% of AAI over $9,400 $11,801 to $14,200 .................................... $2,668 + 29% of AAI over $11,800 $14,201 to $16,600 .................................... $3,364 + 34% of AAI over $14,200 $16,601 to $19,000 .................................... $4,180 + 40% of AAI over $16,600 $19,001 or more ......................................... $5,140 + 47% of AAI over $19,000 (f) COMPUTATIONS IN CASE OF SEPARATION, DIVORCE, REMAR- RIAGE, OR DEATH.— (1) DIVORCED OR SEPARATED PARENTS.—Parental income and assets for a student whose parents are divorced or sepa- rated is determined under the following procedures: (A) Include only the income and assets of the parent with whom the student resided for the greater portion of the 12-month period preceding the date of the application.
(B) If the preceding criterion does not apply, include only the income and assets of the parent who provided the greater portion of the student’s support for the 12-month period preceding the date of application.

(C) If neither of the preceding criteria apply, include only the income and assets of the parent who provided the greater support during the most recent calendar year for which parental support was provided.
(2) DEATH OF A PARENT.—Parental income and assets in the case of the death of any parent is determined as follows: (A) If either of the parents has died, the student shall include only the income and assets of the surviving parent.

(B) If both parents have died, the student shall not re- port any parental income or assets.
(3) REMARRIED PARENTS.—If a parent whose income and assets are taken into account under paragraph (1) of this sub- section, or if a parent who is a widow or widower and whose income is taken into account under paragraph (2) of this sub- section, has remarried, the income of that parent’s spouse shall be included in determining the parent’s adjusted available in- come only if— (A) the student’s parent and the stepparent are mar- ried as of the date of application for the award year con- cerned; and (B) the student is not an independent student.
(g) STUDENT CONTRIBUTION FROM AVAILABLE INCOME.— (1) IN GENERAL.—The student contribution from available income is equal to— (A) the student’s total income (determined in accord- ance with section 480); minus (B) the adjustment to student income (determined in accordance with paragraph (2)); multiplied by (C) the assessment rate as determined in paragraph (5); September 8, 2023 As Amended Through P.L.
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475 except that the amount determined under this subsection shall not be less than zero.
(2) ADJUSTMENT TO STUDENT INCOME.—The adjustment to student income is equal to the sum of— (A) Federal income taxes of the student; (B) an allowance for State and other income taxes (de- termined in accordance with paragraph (3)); (C) an allowance for social security taxes determined in accordance with paragraph (4); (D) an income protection allowance of the following amount (or a successor amount prescribed by the Secretary under section 478)— (i) for academic year 2009–2010, $3,750; (ii) for academic year 2010–2011, $4,500; (iii) for academic year 2011–2012, $5,250; and (iv) for academic year 2012–2013, $6,000; (E) the amount of any tax credit taken by the student under section 25A of the Internal Revenue Code of 1986; and (F) an allowance for parents’ negative available in- come, determined in accordance with paragraph (6).
(3) ALLOWANCE FOR STATE AND OTHER INCOME TAXES.—The allowance for State and other income taxes is equal to an amount determined by multiplying total income (as defined in section 480) by a percentage determined according to the fol- lowing table (or a successor table prescribed by the Secretary under section 478): Percentages for Computation of State and Other Tax Allowance If the students’ State or territory of residence is— The per- centage is— Alaska, American Samoa, Florida, Guam, Nevada, South Dakota, Ten- nessee, Texas, Trust Territory, Virgin Islands, Washington, Wyoming Connecticut, Louisiana, Puerto Rico ............................................................. Arizona, New Hampshire, New Mexico, North Dakota ............................... Alabama, Colorado, Illinois, Indiana, Kansas, Mississippi, Missouri, Montana, Nebraska, New Jersey, Oklahoma ........................................... Arkansas, Georgia, Iowa, Kentucky, Maine, Pennsylvania, Utah, Vermont, Virginia, West Virginia, Canada, Mexico ................................. California, Idaho, Massachusetts, North Carolina, Ohio, Rhode Island, South Carolina ............................................................................................ Hawaii, Maryland, Michigan, Wisconsin ...................................................... Delaware, District of Columbia, Minnesota, Oregon ................................... New York ........................................................................................................ Other ............................................................................................................... 0 (4) ALLOWANCE FOR SOCIAL SECURITY TAXES.—The allow- ance for social security taxes is equal to the amount earned by the student multiplied by the social security withholding rate appropriate to the tax year of the earnings, up to the max- imum statutory social security tax withholding amount for that same tax year.
September 8, 2023 As Amended Through P.L.

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475 HIGHER EDUCATION ACT OF 1965 550 (5) The student’s available income (determined in accord- ance with paragraph (1) of this subsection) is assessed at 50 percent.
(6) ALLOWANCE FOR PARENTS’ NEGATIVE AVAILABLE IN- COME.—The allowance for parents’ negative available income is the amount, if any, by which the sum of the amounts deducted under subparagraphs (A) through (F) of subsection (c)(1) ex- ceeds the sum of the parents’ total income (as defined in sec- tion 480) and the parents’ contribution from assets (as deter- mined in accordance with subsection (d)).
(h) STUDENT CONTRIBUTION FROM ASSETS.—The student con- tribution from assets is determined by calculating the net assets of the student and multiplying such amount by 20 percent, except that the result shall not be less than zero.
(i) ADJUSTMENTS TO PARENTS’ CONTRIBUTION FOR ENROLLMENT PERIODS OTHER THAN 9 MONTHS FOR PURPOSES OTHER THAN SUB- PART 2 OF PART A OF THIS TITLE.—For periods of enrollment other than 9 months, the parents’ contribution from adjusted available income (as determined under subsection (b)) is determined as fol- lows for purposes other than subpart 2 of part A of this title: (1) For periods of enrollment less than 9 months, the par- ents’ contribution from adjusted available income is divided by 9 and the result multiplied by the number of months enrolled.
(2) For periods of enrollment greater than 9 months— (A) the parents’ adjusted available income (determined in accordance with subsection (b)(1)) is increased by the difference between the income protection allowance (deter- mined in accordance with subsection (c)(4)) for a family of four and a family of five, each with one child in college; (B) the resulting revised parents’ adjusted available income is assessed according to subsection (e) and adjusted according to subsection (b)(3) to determine a revised par- ents’ contribution from adjusted available income; (C) the original parents’ contribution from adjusted available income is subtracted from the revised parents’ contribution from adjusted available income, and the re- sult is divided by 12 to determine the monthly adjustment amount; and (D) the original parents’ contribution from adjusted available income is increased by the product of the month- ly adjustment amount multiplied by the number of months greater than 9 for which the student will be enrolled.
(j) ADJUSTMENTS TO STUDENT’S CONTRIBUTION FOR ENROLL- MENT PERIODS OF LESS THAN NINE MONTHS.—For periods of enroll- ment of less than 9 months, the student’s contribution from ad- justed available income (as determined under subsection (g)) is de- termined, for purposes other than subpart 2 of part A, by dividing the amount determined under such subsection by 9, and multi- plying the result by the number of months in the period of enroll- ment.
øNote: For currency of the version of section 475, see footnote that appears at the heading of part F of this title.¿ September 8, 2023 As Amended Through P.L.

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475 SEC.

475. ƒ20 U.S.C.

1087oo≈ STUDENT AID INDEX FOR DEPENDENT STU- DENTS.
(a) COMPUTATION OF STUDENT AID INDEX.— (1) IN GENERAL.—Except as provided in paragraph (2), for each dependent student, the student aid index is equal to the sum of— (A) the assessment of the parents’ adjusted available income (determined in accordance with subsection (b)); (B) the assessment of the student’s available income (determined in accordance with subsection (g)); and (C) the student’s available assets (determined in ac- cordance with subsection (h)).
(2) EXCEPTION.—If the sum determined under paragraph (1) with respect to a dependent student is less than – $1,500, the student aid index for the dependent student shall be – $1,500.
(b) ASSESSMENT OF PARENTS’ ADJUSTED AVAILABLE INCOME.— The assessment of parents’ adjusted available income is equal to the amount determined by— (1) computing adjusted available income by adding— (A) the parents’ available income (determined in ac- cordance with subsection (c)); and (B) the parents’ available assets (determined in accord- ance with subsection (d)); (2) assessing such adjusted available income in accordance with the assessment schedule set forth in subsection (e); and (3) considering such assessment resulting under paragraph (2) as the amount determined under this subsection.
(c) PARENTS’ AVAILABLE INCOME.— (1) IN GENERAL.—The parents’ available income is deter- mined by subtracting from total income (as defined in section 480)— (A) Federal income taxes; (B) an allowance for payroll taxes, determined in ac- cordance with paragraph (2); (C) an income protection allowance, determined in ac- cordance with paragraph (3); and (D) an employment expense allowance, determined in accordance with paragraph (4).
(2) ALLOWANCE FOR PAYROLL TAXES.—The allowance for payroll taxes is equal to the sum of— (A) the total amount earned by the parents, multiplied by the rate of tax under section 3101(b) of the Internal Rev- enue Code of 1986; and (B) the amount earned by the parents that does not ex- ceed such contribution and benefit base (twice such con- tribution and benefit base, in the case of a joint return) for the year of the earnings, multiplied by the rate of tax appli- cable to such earnings under section 3101(a) of the Internal Revenue Code of 1986.
(3) INCOME PROTECTION ALLOWANCE.—The income protec- tion allowance shall equal the amount determined in the fol- lowing table, as adjusted by the Secretary pursuant to section 478(b): September 8, 2023 As Amended Through P.L.

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475 HIGHER EDUCATION ACT OF 1965 552 Income Protection Allowance (to be adjusted for 2023–2024 and succeeding years) Family Size (including student) Amount 2 ........................................................................................................................................ 3 ........................................................................................................................................ 4 ........................................................................................................................................ 5 ........................................................................................................................................ 6 ........................................................................................................................................ For each additional add ................................................................................................. $23,330 $29,040 $35,870 $42,320 $49,500 $5,590.
(4) EMPLOYMENT EXPENSE ALLOWANCE.—The employment expense allowance is equal to the lesser of $4,000 or 35 percent of the single parent’s earned income or married parents’ com- bined earned income (as adjusted by the Secretary pursuant to section 478(g)).
(d) PARENTS’ AVAILABLE ASSETS.— (1) IN GENERAL.— (A) DETERMINATION.—Except as provided in subpara- graph (B), the parents’ available assets are equal to— (i) the difference between the parents’ assets and the asset protection allowance (determined in accord- ance with paragraph (2)); multiplied by (ii) 12 percent.

(B) NOT LESS THAN ZERO.—The parents’ available as- sets under this subsection shall not be less than zero.
(2) ASSET PROTECTION ALLOWANCE.—The asset protection allowance is calculated based on the following table (as revised by the Secretary pursuant to section 478(d)): Asset Protection Allowances for Parents of Dependent Students And there are If the age of the oldest parent is— two parents one parent then the allowance is— 25 or less .......................................................... 26 ...................................................................... 27 ...................................................................... 28 ...................................................................... 29 ...................................................................... 30 ...................................................................... 31 ...................................................................... 32 ...................................................................... 33 ...................................................................... 34 ...................................................................... 35 ...................................................................... 36 ...................................................................... 37 ...................................................................... 38 ...................................................................... 39 ...................................................................... 40 ...................................................................... 41 ...................................................................... 42 ...................................................................... 43 ...................................................................... 44 ...................................................................... 45 ...................................................................... $0 $400 $700 $1,100 $1,500 $1,800 $2,200 $2,600 $2,900 $3,300 $3,700 $4,000 $4,400 $4,800 $5,100 $5,500 $5,600 $5,700 $5,900 $6,000 $6,200 $0 $100 $300 $400 $600 $700 $800 $1,000 $1,100 $1,300 $1,400 $1,500 $1,700 $1,800 $2,000 $2,100 $2,200 $2,200 $2,300 $2,300 $2,400 September 8, 2023 As Amended Through P.L.
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475 Asset Protection Allowances for Parents of Dependent Students—Continued If the age of the oldest parent is— two parents one parent then the allowance is— And there are 46 ...................................................................... 47 ...................................................................... 48 ...................................................................... 49 ...................................................................... 50 ...................................................................... 51 ...................................................................... 52 ...................................................................... 53 ...................................................................... 54 ...................................................................... 55 ...................................................................... 56 ...................................................................... 57 ...................................................................... 58 ...................................................................... 59 ...................................................................... 60 ...................................................................... 61 ...................................................................... 62 ...................................................................... 63 ...................................................................... 64 ...................................................................... 65 or more ........................................................ $6,300 $6,500 $6,600 $6,800 $7,000 $7,100 $7,300 $7,500 $7,700 $7,900 $8,100 $8,400 $8,600 $8,800 $9,100 $9,300 $9,600 $9,900 $10,200 $10,500 $2,400 $2,500 $2,500 $2,600 $2,700 $2,700 $2,800 $2,900 $2,900 $3,000 $3,100 $3,100 $3,200 $3,300 $3,400 $3,500 $3,600 $3,700 $3,800 $3,900.
(e) ASSESSMENT SCHEDULE.—The assessment of the parents’ ad- justed available income (as determined under subsection (b)(1) and hereafter in this subsection referred to as ‘‘AAI’’) is calculated based on the following table (as revised by the Secretary pursuant to sec- tion 478(e)): Parents’ Contribution From AAI If the parents’ AAI is— Then the parents’ contribution from AAI is— Less than – $6,820 ..................................... – $6,820 to $17,400 .................................... 22% of AAI $17,401 to $21,800 ................................... $21,801 to $26,200 ................................... $26,201 to $30,700 ................................... $30,701 to $35,100 ................................... $35,101 or more ........................................ $3,828 + 25% of AAI over $17,400 $4,928 + 29% of AAI over $21,800 $6,204 + 34% of AAI over $26,200 $7,734 + 40% of AAI over $30,700 $9,494 + 47% of AAI over $35,100.
– $1,500 (f) CONSIDERATION OF PARENTAL INCOME.— (1) PARENTS WHO LIVE TOGETHER.—Parental income and assets in the case of student whose parents are married and not separated, or who are unmarried but live together, shall include the income and assets of both parents.
(2) DIVORCED OR SEPARATED PARENTS.—Parental income and assets for a student whose parents are divorced or sepa- rated, but not remarried, is determined by including only the income and assets of the parent who provides the greater por- tion of the student’s financial support.

(3) DEATH OF A PARENT.—Parental income and assets in the case of the death of any parent is determined as follows: September 8, 2023 As Amended Through P.L.
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475 HIGHER EDUCATION ACT OF 1965 554 (A) If either of the parents has died, the surviving par- ent shall be considered a single parent, until that parent has remarried.

(B) If both parents have died, the student shall not re- port any parental income or assets.
(4) REMARRIED PARENTS.—If a parent whose income and assets are taken into account under paragraph (2), or if a par- ent who is a widow or widower and whose income is taken into account under paragraph (3), has remarried, the income of that parent’s spouse shall be included in determining the parent’s assessment of adjusted available income if the student’s parent and the stepparent are married as of the date of application for the award year concerned.
(5) SINGLE PARENT WHO IS NOT DIVORCED OR SEPARATED.— Parental income and assets in the case of a student whose par- ent is not described in paragraph (1) and is a single parent who is not divorced, separated, or remarried, shall include the in- come and assets of such single parent.
(g) STUDENT’S AVAILABLE INCOME.— (1) IN GENERAL.—The student’s available income is equal to— (A) the difference between the student’s total income (determined in accordance with section 480) and the ad- justment to student income (determined in accordance with paragraph (2)); multiplied by (B) 50 percent.
(2) ADJUSTMENT TO STUDENT INCOME.—The adjustment to student income is equal to the sum of— (A) Federal income taxes; (B) an allowance for payroll taxes determined in ac- cordance with paragraph (3); (C) an income protection allowance that is equal to $9,410, as adjusted pursuant to section 478(b); and (D) an allowance for parents’ negative available in- come, determined in accordance with paragraph (4).
(3) ALLOWANCE FOR PAYROLL TAXES.—The allowance for payroll taxes is equal to the sum of— (A) the total amount earned by the student, multiplied by the rate of tax under section 3101(b) of the Internal Rev- enue Code of 1986; and (B) the amount earned by the student that does not ex- ceed such contribution and benefit base for the year of the earnings, multiplied by the rate of tax applicable to such earnings under section 3101(a) of the Internal Revenue Code of 1986.
(4) ALLOWANCE FOR PARENTS’ NEGATIVE AVAILABLE IN- COME.—The allowance for parents’ negative available income is the amount, if any, by which the sum of the amounts deducted under subsection (c)(1) exceeds the sum of the parents’ total in- come (as defined in section 480) and the parents’ available as- sets (as determined in accordance with subsection (d)).
(h) STUDENT’S ASSETS.—The student’s assets are determined by calculating the assets of the student and multiplying such amount by 20 percent, except that the result shall not be less than zero.

September 8, 2023 As Amended Through P.L.

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476 SEC.

476. ø20 U.S.C.


1087pp¿ FAMILY CONTRIBUTION FOR INDE- PENDENT STUDENTS WITHOUT DEPENDENTS OTHER THAN A SPOUSE.
(a) COMPUTATION OF EXPECTED FAMILY CONTRIBUTION.—For each independent student without dependents other than a spouse, the expected family contribution is determined by— (1) adding— (A) the family’s contribution from available income (determined in accordance with subsection (b)); and (B) the family’s contribution from assets (determined in accordance with subsection (c)); (2) dividing the sum resulting under paragraph (1) by the number of students who are enrolled or accepted for enroll- ment, on at least a half-time basis, in a degree, certificate, or other program leading to a recognized educational credential at an institution of higher education that is an eligible institution in accordance with the provisions of section 487 during the award period for which assistance under this title is requested; and (3) for periods of enrollment of less than 9 months, for pur- poses other than subpart 2 of part A— (A) dividing the quotient resulting under paragraph (2) by 9; and (B) multiplying the result by the number of months in the period of enrollment; except that the amount determined under this subsection shall not be less than zero.
(b) FAMILY’S CONTRIBUTION FROM AVAILABLE INCOME.— (1) IN GENERAL.—The family’s contribution from income is determined by— (A) deducting from total income (as defined in section 480)— (i) Federal income taxes; (ii) an allowance for State and other taxes, deter- mined in accordance with paragraph (2); (iii) an allowance for social security taxes, deter- mined in accordance with paragraph (3); (iv) an income protection allowance of the fol- lowing amount (or a successor amount prescribed by the Secretary under section 478)— (I) for single or separated students, or mar- ried students where both are enrolled pursuant to subsection (a)(2)— (aa) for academic year 2009–2010, $7,000; (bb) for academic year 2010–2011, $7,780; (cc) for academic year 2011–2012, $8,550; and (dd) for academic year 2012–2013, $9,330; and (II) for married students where 1 is enrolled pursuant to subsection (a)(2)— (aa) $11,220; for academic year 2009–2010, September 8, 2023 As Amended Through P.L.
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476 HIGHER EDUCATION ACT OF 1965 556 (bb) $12,460; (cc) $13,710; and (dd) $14,960; for academic year 2010–2011, for academic year 2011–2012, for academic year 2012–2013, (v) in the case where a spouse is present, an em- ployment expense allowance, as determined in accord- ance with paragraph (4); and (vi) the amount of any tax credit taken under sec- tion 25A of the Internal Revenue Code of 1986; and (B) assessing such available income in accordance with paragraph (5).
(2) ALLOWANCE FOR STATE AND OTHER TAXES.—The allow- ance for State and other taxes is equal to an amount deter- mined by multiplying total income (as defined in section 480) by a percentage determined according to the following table (or a successor table prescribed by the Secretary under section 478): Percentages for Computation of State and Other Tax Allowance If the students’ State or territory of residence is— The per- centage is— Alaska, American Samoa, Florida, Guam, Nevada, South Dakota, Ten- nessee, Texas, Trust Territory, Virgin Islands, Washington, Wyoming Connecticut, Louisiana, Puerto Rico ............................................................. Arizona, New Hampshire, New Mexico, North Dakota ............................... Alabama, Colorado, Illinois, Indiana, Kansas, Mississippi, Missouri, Montana, Nebraska, New Jersey, Oklahoma ........................................... Arkansas, Georgia, Iowa, Kentucky, Maine, Pennsylvania, Utah, Vermont, Virginia, West Virginia, Canada, Mexico ................................. California, Idaho, Massachusetts, North Carolina, Ohio, Rhode Island, South Carolina ............................................................................................ Hawaii, Maryland, Michigan, Wisconsin ...................................................... Delaware, District of Columbia, Minnesota, Oregon ................................... New York ........................................................................................................ Other ............................................................................................................... 0 (3) ALLOWANCE FOR SOCIAL SECURITY TAXES.—The allow- ance for social security taxes is equal to the amount earned by the student (and spouse, if appropriate), multiplied by the so- cial security withholding rate appropriate to the tax year pre- ceding the award year, up to the maximum statutory social se- curity tax withholding amount for that same tax year.
(4) EMPLOYMENT EXPENSES ALLOWANCE.—The employment expense allowance is determined as follows (or using a suc- cessor provision prescribed by the Secretary under section 478): (A) If the student is married and the student’s spouse is employed in the year for which income is reported, such allowance is equal to the lesser of $2,500 or 35 percent of the earned income of the student or spouse with the lesser earned income.

September 8, 2023 As Amended Through P.L.


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476 (B) If a student is not married, the employment ex- pense allowance is zero.
(5) ASSESSMENT OF AVAILABLE INCOME.—The family’s available income (determined in accordance with paragraph (1)(A) of this subsection) is assessed at 50 percent.
(c) FAMILY CONTRIBUTION FROM ASSETS.— (1) IN GENERAL.—The family’s contribution from assets is equal to— (A) the family’s net worth (determined in accordance with paragraph (2)); minus (B) the asset protection allowance (determined in ac- cordance with paragraph (3)); multiplied by (C) the asset conversion rate (determined in accord- ance with paragraph (4)); except that the family’s contribution from assets shall not be less than zero.
(2) FAMILY’S NET WORTH.—The family’s net worth is cal- culated by adding— (A) the current balance of checking and savings ac- counts and cash on hand; (B) the net value of investments and real estate, ex- cluding the net value in the principal place of residence; and (C) the adjusted net worth of a business or farm, com- puted on the basis of the net worth of such business or farm (hereafter referred to as ‘‘NW’’), determined in ac- cordance with the following table (or a successor table pre- scribed by the Secretary under section 478), except as pro- vided under section 480(f): Adjusted Net Worth of a Business or Farm If the net worth of a business or farm is— Then the adjusted net worth is— Less than $1 .............................................. $0 $1–$75,000 ................................................. 40 percent of NW $75,001–$225,000 ...................................... $30,000 plus 50 percent of NW over $75,000 $225,001–$375,000 .................................... $105,000 plus 60 percent of NW over $225,000 $375,001 or more ....................................... $195,000 plus 100 percent of NW over $375,000 (3) ASSET PROTECTION ALLOWANCE.—The asset protection allowance is calculated according to the following table (or a successor table prescribed by the Secretary under section 478): September 8, 2023 As Amended Through P.L.
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476 HIGHER EDUCATION ACT OF 1965 558 Asset Protection Allowances for Families and Students If the age of the student is— And the student is married single then the allowance is— 25 or less ..................................................................................... 26 ................................................................................................. 27 ................................................................................................. 28 ................................................................................................. 29 ................................................................................................. 30 ................................................................................................. 31 ................................................................................................. 32 ................................................................................................. 33 ................................................................................................. 34 ................................................................................................. 35 ................................................................................................. 36 ................................................................................................. 37 ................................................................................................. 38 ................................................................................................. 39 ................................................................................................. 40 ................................................................................................. 41 ................................................................................................. 42 ................................................................................................. 43 ................................................................................................. 44 ................................................................................................. 45 ................................................................................................. 46 ................................................................................................. 47 ................................................................................................. 48 ................................................................................................. 49 ................................................................................................. 50 ................................................................................................. 51 ................................................................................................. 52 ................................................................................................. 53 ................................................................................................. 54 ................................................................................................. 55 ................................................................................................. 56 ................................................................................................. 57 ................................................................................................. 58 ................................................................................................. 59 ................................................................................................. 60 ................................................................................................. 61 ................................................................................................. 62 ................................................................................................. 63 ................................................................................................. 64 ................................................................................................. 65 or more ................................................................................... $ $ (4) ASSET CONVERSION RATE.—The asset conversion rate is 20 percent.
(d) COMPUTATIONS IN CASE OF SEPARATION, DIVORCE, OR DEATH.—In the case of a student who is divorced or separated, or whose spouse has died, the spouse’s income and assets shall not be considered in determining the family’s contribution from income or assets.

September 8, 2023 As Amended Through P.L.


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476 øNote: For currency of the version of section 476, see footnote that appears at the heading of part F of this title.¿ SEC.

476. ƒ20 U.S.C.
476. ƒ20 U.S.C.

1087pp≈ STUDENT AID INDEX FOR INDEPENDENT STUDENTS WITHOUT DEPENDENTS OTHER THAN A SPOUSE.

(a) COMPUTATION OF STUDENT AID INDEX.— (1) IN GENERAL.—For each independent student without de- pendents other than a spouse, the student aid index is equal to (except as provided in paragraph (2)) the sum of— (A) the family’s available income (determined in ac- cordance with subsection (b)); and (B) the family’s available assets (determined in accord- ance with subsection (c)).
(2) EXCEPTION.—If the sum determined under paragraph (1) with respect to an independent student without dependents other than a spouse is less than – $1,500, the student aid index for the independent student shall be – $1,500.
(b) FAMILY’S AVAILABLE INCOME.— (1) IN GENERAL.—The family’s available income is deter- mined by— (A) deducting from total income (as defined in section 480)— (i) Federal income taxes; (ii) an allowance for payroll taxes, determined in accordance with paragraph (2); (iii) an income protection allowance that is equal to— (I) in the case of a single independent student without dependents, $14,630, as adjusted pursuant to section 478(b); and (II) in the case of a married independent stu- dent without dependents, $23,460, as adjusted pur- suant to section 478(b); and (iv) in the case of a married independent student, an employment expense allowance, as determined in accordance with paragraph (3); and (B) multiplying the amount determined under subpara- graph (A) by 50 percent.
(2) ALLOWANCE FOR PAYROLL TAXES.—The allowance for payroll taxes is equal to the sum of— (A) the total amount earned by the student (and spouse, if appropriate), multiplied by the rate of tax under section 3101(b) of the Internal Revenue Code of 1986; and (B) the amount earned by the student (and spouse, if appropriate) that does not exceed such contribution and benefit base (twice such contribution and benefit base, in the case of a joint return) for the year of the earnings, mul- tiplied by the rate of tax applicable to such earnings under section 3101(a) of the Internal Revenue Code of 1986.
(3) EMPLOYMENT EXPENSE ALLOWANCE.—The employment expense allowance is equal to the following: (A) If the student is married, such allowance is equal to the lesser of $4,000 or 35 percent of the couple’s com- September 8, 2023 As Amended Through P.L.

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476 HIGHER EDUCATION ACT OF 1965 560 bined earned income (as adjusted by the Secretary pursu- ant to section 478(g)).

(B) If the student is not married, the employment ex- pense allowance is zero.
(c) FAMILY’S AVAILABLE ASSETS.— (1) IN GENERAL.— (A) DETERMINATION.—Except as provided in subpara- graph (B), the family’s available assets are equal to— (i) the difference between the family’s assets (as de- fined in section 480(f)) and the asset protection allow- ance (determined in accordance with paragraph (2)); multiplied by (ii) 20 percent.

(B) NOT LESS THAN ZERO.—The family’s available as- sets under this subsection shall not be less than zero.
(2) ASSET PROTECTION ALLOWANCE.—The asset protection allowance is calculated based on the following table (as revised by the Secretary pursuant to section 478(d)): Asset Protection Allowances for Families and Students If the age of the student is— 25 or less .......................................................... 26 ...................................................................... 27 ...................................................................... 28 ...................................................................... 29 ...................................................................... 30 ...................................................................... 31 ...................................................................... 32 ...................................................................... 33 ...................................................................... 34 ...................................................................... 35 ...................................................................... 36 ...................................................................... 37 ...................................................................... 38 ...................................................................... 39 ...................................................................... 40 ...................................................................... 41 ...................................................................... 42 ...................................................................... 43 ...................................................................... 44 ...................................................................... 45 ...................................................................... 46 ...................................................................... 47 ...................................................................... 48 ...................................................................... 49 ...................................................................... 50 ...................................................................... 51 ...................................................................... 52 ...................................................................... 53 ...................................................................... 54 ...................................................................... 55 ...................................................................... 56 ...................................................................... 57 ...................................................................... 58 ...................................................................... And the student is married single then the allowance is— $0 $400 $700 $1,100 $1,500 $1,800 $2,200 $2,600 $2,900 $3,300 $3,700 $4,000 $4,400 $4,800 $5,100 $5,500 $5,600 $5,700 $5,900 $6,000 $6,200 $6,300 $6,500 $6,600 $6,800 $7,000 $7,100 $7,300 $7,500 $7,700 $7,900 $8,100 $8,400 $8,600 $0 $100 $300 $400 $600 $700 $800 $1,000 $1,100 $1,300 $1,400 $1,500 $1,700 $1,800 $2,000 $2,100 $2,200 $2,200 $2,300 $2,300 $2,400 $2,400 $2,500 $2,500 $2,600 $2,700 $2,700 $2,800 $2,900 $2,900 $3,000 $3,100 $3,100 $3,200 September 8, 2023 As Amended Through P.L.
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477 Asset Protection Allowances for Families and Students—Continued If the age of the student is— And the student is married single then the allowance is— 59 ...................................................................... 60 ...................................................................... 61 ...................................................................... 62 ...................................................................... 63 ...................................................................... 64 ...................................................................... 65 or more ........................................................ $8,800 $9,100 $9,300 $9,600 $9,900 $10,200 $10,500 $3,300 $3,400 $3,500 $3,600 $3,700 $3,800 $3,900.
(d) COMPUTATIONS IN CASE OF SEPARATION, DIVORCE, OR DEATH.—In the case of a student who is divorced or separated, or whose spouse has died, the spouse’s income and assets shall not be considered in determining the family’s available income or assets.

SEC.

477. ø20 U.S.C.

1087qq¿ FAMILY CONTRIBUTION FOR INDE- PENDENT STUDENTS WITH DEPENDENTS OTHER THAN A SPOUSE.
(a) COMPUTATION OF EXPECTED FAMILY CONTRIBUTION.—For each independent student with dependents other than a spouse, the expected family contribution is equal to the amount determined by— (1) computing adjusted available income by adding— (A) the family’s available income (determined in ac- cordance with subsection (b)); and (B) the family’s contribution from assets (determined in accordance with subsection (c)); (2) assessing such adjusted available income in accordance with an assessment schedule set forth in subsection (d); (3) dividing the assessment resulting under paragraph (2) by the number of family members who are enrolled or accepted for enrollment, on at least a half-time basis, in a degree, cer- tificate, or other program leading to a recognized educational credential at an institution of higher education that is an eligi- ble institution in accordance with the provisions of section 487 during the award period for which assistance under this title is requested; and (4) for periods of enrollment of less than 9 months, for pur- poses other than subpart 2 of part A— (A) dividing the quotient resulting under paragraph (3) by 9; and (B) multiplying the result by the number of months in the period of enrollment; except that the amount determined under this subsection shall not be less than zero.
(b) FAMILY’S AVAILABLE INCOME.— (1) IN GENERAL.—The family’s available income is deter- mined by deducting from total income (as defined in section 480)— (A) Federal income taxes; September 8, 2023 As Amended Through P.L.

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477 HIGHER EDUCATION ACT OF 1965 562 (B) an allowance for State and other taxes, determined in accordance with paragraph (2); (C) an allowance for social security taxes, determined in accordance with paragraph (3); (D) an income protection allowance, determined in ac- cordance with paragraph (4); (E) an employment expense allowance, determined in accordance with paragraph (5); and (F) the amount of any tax credit taken under section 25A of the Internal Revenue Code of 1986.
(2) ALLOWANCE FOR STATE AND OTHER TAXES.—The allow- ance for State and other taxes is equal to an amount deter- mined by multiplying total income (as defined in section 480) by a percentage determined according to the following table (or a successor table prescribed by the Secretary under section 478): Percentages for Computation of State and Other Tax Allowance If student’s State or territory of residence is— And family’s total income is— less than $15,000 $15,000 or more then the percentage is— Alaska, Puerto Rico, Wyoming .................................................. American Samoa, Guam, Louisiana, Nevada, Texas, Trust Territory, Virgin Islands ........................................................ Florida, South Dakota, Tennessee, New Mexico ...................... North Dakota, Washington ........................................................ Alabama, Arizona, Arkansas, Indiana, Mississippi, Missouri, Montana, New Hampshire, Oklahoma, West Virginia ........ Colorado, Connecticut, Georgia, Illinois, Kansas, Kentucky ... California, Delaware, Idaho, Iowa, Nebraska, North Caro- lina, Ohio, Pennsylvania, South Carolina, Utah, Vermont, Virginia, Canada, Mexico ....................................................... Maine, New Jersey ..................................................................... District of Columbia, Hawaii, Maryland, Massachusetts, Or- egon, Rhode Island .................................................................. Michigan, Minnesota .................................................................. Wisconsin .................................................................................... New York ..................................................................................... Other ............................................................................................ (3) ALLOWANCE FOR SOCIAL SECURITY TAXES.—The allow- ance for social security taxes is equal to the amount estimated to be earned by the student (and spouse, if appropriate) multi- plied by the social security withholding rate appropriate to the tax year preceding the award year, up to the maximum statu- tory social security tax withholding amount for that same tax year.
(4) INCOME PROTECTION ALLOWANCE.—The income protec- tion allowance is determined by the tables described in sub- September 8, 2023 As Amended Through P.L.

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477 paragraphs (A) through (D) (or a successor table prescribed by the Secretary under section 478).
(A) ACADEMIC YEAR 2009–2010.—For academic year 2009–2010, the income protection allowance is determined by the following table: Family Size (including student) For each additional add: Income Protection Allowance Number in College For each addi- tional subtract: $17,720 22,060 27,250 32,150 37,600 $14,690 19,050 24,220 29,120 34,570 $16,020 21,210 26,100 31,570 $18,170 23,070 28,520 $20,060 25,520 $3,020 4,240 4,240 4,240 4,240 4,240 (B) ACADEMIC YEAR 2010–2011.—For academic year 2010–2011, the income protection allowance is determined by the following table: Family Size (including student) For each additional add: Income Protection Allowance Number in College For each addi- tional subtract: $19,690 24,510 30,280 35,730 41,780 $16,330 21,160 26,910 32,350 38,410 $17,800 23,560 29,000 35,080 $20,190 25,640 31,690 $22,290 28,350 $3,350 4,710 4,710 4,710 4,710 4,710 (C) ACADEMIC YEAR 2011–2012.—For academic year 2011–2012, the income protection allowance is determined by the following table: Family Size (including student) Income Protection Allowance Number in College For each addi- tional subtract: 2 3 4 $21,660 26,960 33,300 $17,960 23,280 29,600 $19,580 25,920 $22,210 September 8, 2023 As Amended Through P.L.
117-286, Enacted December 27, 2022 HOLC G:\COMP\EDIII\HIGHER EDUCATION ACT OF 1965.XML Sec.
477 HIGHER EDUCATION ACT OF 1965 564 Family Size (including student) 5 6 For each additional add: Income Protection Allowance—Continued Number in College For each addi- tional subtract: 39,300 45,950 35,590 42,250 31,900 38,580 28,200 34,860 $24,520 31,190 $3,690 5,180 5,180 5,180 5,180 5,180 (D) ACADEMIC YEAR 2012–2013.—For academic year 2012–2013, the income protection allowance is determined by the following table: Family Size (including student) For each additional add: Income Protection Allowance Number in College For each addi- tional subtract: $23,630 29,420 36,330 42,870 50,130 $19,590 25,400 32,300 38,820 46,100 $21,360 28,280 34,800 42,090 $24,230 30,770 38,030 $26,750 34,020 $4,020 5,660 5,660 5,660 5,660 5,660 (5) EMPLOYMENT EXPENSE ALLOWANCE.—The employment expense allowance is determined as follows (or a successor table prescribed by the Secretary under section 478): (A) If the student is married and the student’s spouse is employed in the year for which their income is reported, such allowance is equal to the lesser of $2,500 or 35 per- cent of the earned income of the student or spouse with the lesser earned income.
(B) If a student qualifies as a surviving spouse or as a head of household as defined in section 2 of the Internal Revenue Code of 1986, such allowance is equal to the less- er of $2,500 or 35 percent of the student’s earned income.
(c) FAMILY’S CONTRIBUTION FROM ASSETS.— (1) IN GENERAL.—The family’s contribution from assets is equal to— (A) the family net worth (determined in accordance with paragraph (2)); minus (B) the asset protection allowance (determined in ac- cordance with paragraph (3)); multiplied by (C) the asset conversion rate (determined in accord- ance with paragraph (4)), except that the result shall not be less than zero.

September 8, 2023 As Amended Through P.L.


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477 (2) FAMILY NET WORTH.—The family net worth is cal- culated by adding— (A) the current balance of checking and savings ac- counts and cash on hand; (B) the net value of investments and real estate, ex- cluding the net value in the principal place of residence; and (C) the adjusted net worth of a business or farm, com- puted on the basis of the net worth of such business or farm (hereafter referred to as ‘‘NW’’), determined in ac- cordance with the following table (or a successor table pre- scribed by the Secretary under section 478), except as pro- vided under section 480(f): Adjusted Net Worth of a Business or Farm If the net worth of a business or farm is— Then the adjusted net worth is— Less than $1 .............................................. $0 $1–$75,000 ................................................. 40 percent of NW $75,001–$225,000 ...................................... $30,000 plus 50 percent of NW over $75,000 $225,001–$375,000 .................................... $105,000 plus 60 percent of NW over $225,000 $375,001 or more ....................................... $195,000 plus 100 percent of NW over $375,000 (3) ASSET PROTECTION ALLOWANCE.—The asset protection allowance is calculated according to the following table (or a successor table prescribed by the Secretary under section 478): September 8, 2023 As Amended Through P.L.
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477 HIGHER EDUCATION ACT OF 1965 566 Asset Protection Allowances for Families and Students If the age of the student is— And the student is married single then the allowance is— 25 or less ..................................................................................... 26 ................................................................................................. 27 ................................................................................................. 28 ................................................................................................. 29 ................................................................................................. 30 ................................................................................................. 31 ................................................................................................. 32 ................................................................................................. 33 ................................................................................................. 34 ................................................................................................. 35 ................................................................................................. 36 ................................................................................................. 37 ................................................................................................. 38 ................................................................................................. 39 ................................................................................................. 40 ................................................................................................. 41 ................................................................................................. 42 ................................................................................................. 43 ................................................................................................. 44 ................................................................................................. 45 ................................................................................................. 46 ................................................................................................. 47 ................................................................................................. 48 ................................................................................................. 49 ................................................................................................. 50 ................................................................................................. 51 ................................................................................................. 52 ................................................................................................. 53 ................................................................................................. 54 ................................................................................................. 55 ................................................................................................. 56 ................................................................................................. 57 ................................................................................................. 58 ................................................................................................. 59 ................................................................................................. 60 ................................................................................................. 61 ................................................................................................. 62 ................................................................................................. 63 ................................................................................................. 64 ................................................................................................. 65 or more ................................................................................... $ $ (4) ASSET CONVERSION RATE.—The asset conversion rate is 7 percent.
(d) ASSESSMENT SCHEDULE.—The adjusted available income (as determined under subsection (a)(1) and hereafter referred to as ‘‘AAI’’) is assessed according to the following table (or a successor table prescribed by the Secretary under section 478): September 8, 2023 As Amended Through P.L.
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477 Assessment From Adjusted Available Income (AAI) If AAI is— Then the assessment is— Less than ¥$3,409 .................................... ¥$750 ¥$3,409 to $9,400 ..................................... 22% of AAI $9,401 to $11,800 ...................................... $2,068 + 25% of AAI over $9,400 $11,801 to $14,200 .................................... $2,668 + 29% of AAI over $11,800 $14,201 to $16,600 .................................... $3,364 + 34% of AAI over $14,200 $16,601 to $19,000 .................................... $4,180 + 40% of AAI over $16,600 $19,001 or more ......................................... $5,140 + 47% of AAI over $19,000 (e) COMPUTATIONS IN CASE OF SEPARATION, DIVORCE, OR DEATH.—In the case of a student who is divorced or separated, or whose spouse has died, the spouse’s income and assets shall not be considered in determining the family’s available income or assets.
øNote: For currency of the version of section 477, see footnote that appears at the heading of part F of this title.¿ SEC.

477. ƒ20 U.S.C.

1087qq≈ STUDENT AID INDEX FOR INDEPENDENT STUDENTS WITH DEPENDENTS OTHER THAN A SPOUSE.
(a) COMPUTATION OF STUDENT AID INDEX.— (1) IN GENERAL.—For each independent student with de- pendents other than a spouse, the student aid index is equal to the amount determined by— (A) computing adjusted available income by adding— (i) the family’s available income (determined in ac- cordance with subsection (b)); and (ii) the family’s available assets (determined in ac- cordance with subsection (c)); (B) assessing such adjusted available income in accord- ance with an assessment schedule set forth in subsection (d); and (C) considering such assessment resulting under sub- paragraph (B) as the amount determined under this sub- section.
(2) EXCEPTION.—If the sum determined under paragraph (1) with respect to an independent student with dependents other than a spouse is less than – $1,500, the student aid index for the independent student shall be – $1,500.
(b) FAMILY’S AVAILABLE INCOME.— (1) IN GENERAL.—The family’s available income is deter- mined by deducting from total income (as defined in section 480)— (A) Federal income taxes; (B) an allowance for payroll taxes, determined in ac- cordance with paragraph (2); (C) an income protection allowance, determined in ac- cordance with paragraph (3); and (D) an employment expense allowance, determined in accordance with paragraph (4).
(2) ALLOWANCE FOR PAYROLL TAXES.—The allowance for payroll taxes is equal to the sum of— September 8, 2023 As Amended Through P.L.

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477 HIGHER EDUCATION ACT OF 1965 568 (A) the total amount earned by the student (and spouse, if appropriate), multiplied by the rate of tax under section 3101(b) of the Internal Revenue Code of 1986; and (B) the amount earned by the student (and spouse, if appropriate) that does not exceed such contribution and benefit base (twice such contribution and benefit base, in the case of a joint return) for the year of the earnings, mul- tiplied by the rate of tax applicable to such earnings under section 3101(a) of the Internal Revenue Code of 1986.
(3) INCOME PROTECTION ALLOWANCE.—The income protec- tion allowance shall equal the amount determined in the fol- lowing table, as adjusted by the Secretary pursuant to section 478(b): (A) In the case of a married independent student with dependents: Income Protection Allowance (to be adjusted for 2023–2024 and succeeding years) Family Size (including student) Amount 3 ........................................................................................................................................ 4 ........................................................................................................................................ 5 ........................................................................................................................................ 6 ........................................................................................................................................ For each additional add ................................................................................................. $46,140 $56,970 $67,230 $78,620 $8,880.
(B) In the case of a single independent student with de- pendents: Income Protection Allowance (to be adjusted for 2023–2024 and succeeding years) Family Size (including student) Amount 2 ........................................................................................................................................ 3 ........................................................................................................................................ 4 ........................................................................................................................................ 5 ........................................................................................................................................ 6 ........................................................................................................................................ For each additional add ................................................................................................. $43,920 $54,690 $67,520 $79,680 $93,180 $10,530.
(4) EMPLOYMENT EXPENSE ALLOWANCE.—The employment expense allowance is equal to the lesser of $4,000 or 35 percent of the student’s earned income or the combined earned income of the student and the student’s spouse, if applicable (as ad- justed by the Secretary pursuant to section 478(g)).
(c) FAMILY’S AVAILABLE ASSETS.— (1) IN GENERAL.— (A) DETERMINATION.—Except as provided in subpara- graph (B), the family’s available assets are equal to— (i) the difference between the family’s assets (as de- fined in 480(f)) and the asset protection allowance (de- termined in accordance with paragraph (2)); multiplied by (ii) 7 percent.

September 8, 2023 As Amended Through P.L.


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477 (B) NOT LESS THAN ZERO.—The family’s available as- sets under this subsection shall not be less than zero.
(2) ASSET PROTECTION ALLOWANCE.—The asset protection allowance is calculated based on the following table (as revised by the Secretary pursuant to section 478(d)): Asset Protection Allowances for Families and Students If the age of the student is— 25 or less .......................................................... 26 ...................................................................... 27 ...................................................................... 28 ...................................................................... 29 ...................................................................... 30 ...................................................................... 31 ...................................................................... 32 ...................................................................... 33 ...................................................................... 34 ...................................................................... 35 ...................................................................... 36 ...................................................................... 37 ...................................................................... 38 ...................................................................... 39 ...................................................................... 40 ...................................................................... 41 ...................................................................... 42 ...................................................................... 43 ...................................................................... 44 ...................................................................... 45 ...................................................................... 46 ...................................................................... 47 ...................................................................... 48 ...................................................................... 49 ...................................................................... 50 ...................................................................... 51 ...................................................................... 52 ...................................................................... 53 ...................................................................... 54 ...................................................................... 55 ...................................................................... 56 ...................................................................... 57 ...................................................................... 58 ...................................................................... 59 ...................................................................... 60 ...................................................................... 61 ...................................................................... 62 ...................................................................... 63 ...................................................................... 64 ...................................................................... 65 or more ........................................................ And the student is married single then the allowance is— $0 $400 $700 $1,100 $1,500 $1,800 $2,200 $2,600 $2,900 $3,300 $3,700 $4,000 $4,400 $4,800 $5,100 $5,500 $5,600 $5,700 $5,900 $6,000 $6,200 $6,300 $6,500 $6,600 $6,800 $7,000 $7,100 $7,300 $7,500 $7,700 $7,900 $8,100 $8,400 $8,600 $8,800 $9,100 $9,300 $9,600 $9,900 $10,200 $10,500 $0 $100 $300 $400 $600 $700 $800 $1,000 $1,100 $1,300 $1,400 $1,500 $1,700 $1,800 $2,000 $2,100 $2,200 $2,200 $2,300 $2,300 $2,400 $2,400 $2,500 $2,500 $2,600 $2,700 $2,700 $2,800 $2,900 $2,900 $3,000 $3,100 $3,100 $3,200 $3,300 $3,400 $3,500 $3,600 $3,700 $3,800 $3,900.
(d) ASSESSMENT SCHEDULE.—The assessment of adjusted avail- able income (as determined under subsection (a)(1) and hereafter in this subsection referred to as ‘‘AAI’’) is calculated based on the fol- lowing table (as revised by the Secretary pursuant to section 478(e)): September 8, 2023 As Amended Through P.L.
117-286, Enacted December 27, 2022 HOLC G:\COMP\EDIII\HIGHER EDUCATION ACT OF 1965.XML Sec.
478 HIGHER EDUCATION ACT OF 1965 570 Assessment From Adjusted Available Income If AAI is— Then the assessment is— Less than – $6,820 ..................................... – $6,820 to $17,400 .................................... 22% of AAI $17,401 to $21,800 ................................... $21,801 to $26,200 ................................... $26,201 to $30,700 ................................... $30,701 to $35,100 ................................... $35,101 or more ........................................ $3,828 + 25% of AAI over $17,400 $4,928 + 29% of AAI over $21,800 $6,204 + 34% of AAI over $26,200 $7,734 + 40% of AAI over $30,700 $9,494 + 47% of AAI over $35,100.
– $1,500 (e) COMPUTATIONS IN CASE OF SEPARATION, DIVORCE, OR DEATH.—In the case of a student who is divorced or separated, or whose spouse has died, the spouse’s income and assets shall not be considered in determining the family’s available income or assets.

SEC.

478. ø20 U.S.C.

1087rr¿ REGULATIONS; UPDATED TABLES.


(a) AUTHORITY TO PRESCRIBE REGULATIONS RESTRICTED.—(1) Notwithstanding any other provision of law, the Secretary shall not have the authority to prescribe regulations to carry out this part except— (A) to prescribe updated tables in accordance with sub- sections (b) through (h) of this section; or (B) to propose modifications in the need analysis method- ology required by this part.
(2) Any regulation proposed by the Secretary that (A) updates tables in a manner that does not comply with subsections (b) through (h) of this section, or (B) that proposes modifications under paragraph (1)(B) of this subsection, shall not be effective unless ap- proved by joint resolution of the Congress by May 1 following the date such regulations are published in the Federal Register in ac- cordance with section 482.
If the Congress fails to approve such regulations by such May 1, the Secretary shall publish in the Fed- eral Register in accordance with section 482 updated tables for the applicable award year that are prescribed in accordance with sub- sections (b) through (h) of this section.
(b) INCOME PROTECTION ALLOWANCE.— (1) REVISED TABLES.— (A) IN GENERAL.—For each academic year after aca- demic year 2008–2009, the Secretary shall publish in the Federal Register a revised table of income protection al- lowances for the purpose of sections 475(c)(4) and 477(b)(4), subject to subparagraphs (B) and (C).
(B) TABLE FOR INDEPENDENT STUDENTS.— (i) ACADEMIC YEARS 2009–2010 THROUGH 2012– 2013.—For each of the academic years 2009–2010 through 2012–2013, the Secretary shall not develop a revised table of income protection allowances under section 477(b)(4) and the table specified for such aca- demic year under subparagraphs (A) through (D) of such section shall apply.

September 8, 2023 As Amended Through P.L.


117-286, Enacted December 27, 2022 (ii) OTHER ACADEMIC YEARS.—For each academic year after academic year 2012–2013, the Secretary shall develop the revised table of income protection al- HOLC G:\COMP\EDIII\HIGHER EDUCATION ACT OF 1965.XML 571 HIGHER EDUCATION ACT OF 1965 Sec.
478 lowances by increasing each of the dollar amounts con- tained in the table of income protection allowances under section 477(b)(4)(D) by a percentage equal to the estimated percentage increase in the Consumer Price Index (as determined by the Secretary) between De- cember 2011 and the December next preceding the be- ginning of such academic year, and rounding the re- sult to the nearest $10.
(C) TABLE FOR PARENTS.—For each academic year after academic year 2008–2009, the Secretary shall de- velop the revised table of income protection allowances under section 475(c)(4) by increasing each of the dollar amounts contained in the table by a percentage equal to the estimated percentage increase in the Consumer Price Index (as determined by the Secretary) between December 1992 and the December next preceding the beginning of such academic year, and rounding the result to the nearest $10.
(2) REVISED AMOUNTS.—For each academic year after aca- demic year 2007–2008, the Secretary shall publish in the Fed- eral Register revised income protection allowances for the pur- pose of sections 475(g)(2)(D) and 476(b)(1)(A)(iv).
Such revised allowances shall be developed for each academic year after aca- demic year 2012–2013, by increasing each of the dollar amounts contained in such section for academic year 2012– 2013 by a percentage equal to the estimated percentage in- crease in the Consumer Price Index (as determined by the Sec- retary) between December 2011 and the December next pre- ceding the beginning of such academic year, and rounding the result to the nearest $10.
(c) ADJUSTED NET WORTH OF A FARM OR BUSINESS.—For each award year after award year 1993–1994, the Secretary shall pub- lish in the Federal Register a revised table of adjusted net worth of a farm or business for purposes of sections 475(d)(2)(C), 476(c)(2)(C), and 477(c)(2)(C).
Such revised table shall be devel- oped— (1) by increasing each dollar amount that refers to net worth of a farm or business by a percentage equal to the esti- mated percentage increase in the Consumer Price Index (as de- termined by the Secretary) between December 1992 and the December next preceding the beginning of such award year, and rounding the result to the nearest $5,000; and (2) by adjusting the dollar amounts ‘‘$30,000’’, ‘‘$105,000’’, and ‘‘$195,000’’ to reflect the changes made pursuant to para- graph (1).
(d) EDUCATION SAVINGS AND ASSET PROTECTION ALLOWANCE.— For each award year after award year 1993–1994, the Secretary shall publish in the Federal Register a revised table of allowances for the purpose of sections 475(d)(3), 476(c)(3), and 477(c)(3).
Such revised table shall be developed by determining the present value cost, rounded to the nearest $100, of an annuity that would pro- vide, for each age cohort of 40 and above, a supplemental income at age 65 (adjusted for inflation) equal to the difference between the moderate family income (as most recently determined by the September 8, 2023 As Amended Through P.L.
117-286, Enacted December 27, 2022 HOLC G:\COMP\EDIII\HIGHER EDUCATION ACT OF 1965.XML Sec.

478 HIGHER EDUCATION ACT OF 1965 572 Bureau of Labor Statistics), and the current average social security retirement benefits.
For each age cohort below 40, the allowance shall be computed by decreasing the allowance for age 40, as up- dated, by one-fifteenth for each year of age below age 40 and rounding the result to the nearest $100.

In making such deter- minations— (1) inflation shall be presumed to be 6 percent per year; (2) the rate of return of an annuity shall be presumed to be 8 percent; and (3) the sales commission on an annuity shall be presumed to be 6 percent.
(e) ASSESSMENT SCHEDULES AND RATES.—For each award year after award year 1993–1994, the Secretary shall publish in the Federal Register a revised table of assessments from adjusted available income for the purpose of sections 475(e) and 477(d).
Such revised table shall be developed— (1) by increasing each dollar amount that refers to ad- justed available income by a percentage equal to the estimated percentage increase in the Consumer Price Index (as deter- mined by the Secretary) between December 1992 and the De- cember next preceding the beginning of such academic year, rounded to the nearest $100; and (2) by adjusting the other dollar amounts to reflect the changes made pursuant to paragraph (1).
(f) DEFINITION OF CONSUMER PRICE INDEX.—As used in this section, the term ‘‘Consumer Price Index’’ means the Consumer Price Index for All Urban Consumers published by the Department of Labor.

Each annual update of tables to reflect changes in the Consumer Price Index shall be corrected for misestimation of ac- tual changes in such Index in previous years.
(g) STATE AND OTHER TAX ALLOWANCE.—For each award year after award year 1993–1994, the Secretary shall publish in the Federal Register a revised table of State and other tax allowances for the purpose of sections 475(c)(2), 475(g)(3), 476(b)(2), and 477(b)(2).

The Secretary shall develop such revised table after re- view of the Department of the Treasury’s Statistics of Income file and determination of the percentage of income that each State’s taxes represent.
(h) EMPLOYMENT EXPENSE ALLOWANCE.—For each award year after award year 1993–1994, the Secretary shall publish in the Federal Register a revised table of employment expense allowances for the purpose of sections 475(c)(5), 476(b)(4), and 477(b)(5).
Such revised table shall be developed by increasing the dollar amount specified sections 475(c)(5)(A), 475(c)(5)(B), 476(b)(4)(A), 477(b)(5)(A), and 477(b)(5)(B) to reflect increases in the amount and percent of the Bureau of Labor Statistics budget of the mar- ginal costs for food away from home, apparel, transportation, and household furnishings and operations for a two-worker versus one- worker family.
in øNote: For currency of the version of section 478, see footnote that appears at the heading of part F of this title.¿ September 8, 2023 As Amended Through P.L.

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478 SEC.

478. ƒ20 U.S.C.

1087rr≈ REGULATIONS; UPDATED TABLES.


(a) AUTHORITY TO PRESCRIBE REGULATIONS RESTRICTED.—Not- withstanding any other provision of law, the Secretary shall not have the authority to prescribe regulations to carry out this part ex- cept— (1) to prescribe updated tables in accordance with sub- sections (b) through (g); and (2) with respect to the definition of cost of attendance under section 472, excluding section 472(a)(1).
(b) INCOME PROTECTION ALLOWANCE ADJUSTMENTS.—For award year 2023–2024 and each subsequent award year, the Sec- retary shall publish in the Federal Register revised income protec- tion allowances for the purposes of subsections (c)(3) and (g)(2)(C) of section 475, subclauses (I) and (II) of section 476(b)(1)(A)(iii), and section 477(b)(3), by increasing the income protection allowances in each of such provisions, by a percentage equal to the percentage in- crease in the Consumer Price Index, as defined in subsection (f), be- tween April 2020 and the April in the year prior to the beginning of the award year and rounding the result to the nearest $10.
(c) ADJUSTED NET WORTH OF A FARM OR BUSINESS.— (1) TABLE.—The table of the net worth of a farm or busi- ness for purposes of making determinations of assets as defined under section 480(f) is the following: Farm/Business Net Worth Adjustment If the net worth of a farm or business is— Then the adjusted net worth is— Less than $1 ............................................... $0 $1 to $140,000 .......................................... $140,001 to $415,000 ............................... 40% of net worth of farm/business $56,000 + 50% of net worth over $140,000 $415,001 to $695,000 ............................... $193,500 + 60% of net worth over $415,000 $695,001 or more ...................................... $361,500 + 100% of net worth over $695,000.
(2) REVISED TABLES.—For award year 2023–2024 and each subsequent award year, the Secretary shall publish in the Fed- eral Register a revised table of the adjusted net worth of a farm or business for purposes of section 480(f).
Such revised table shall be developed— (A) by increasing each dollar amount that refers to net worth of a farm or business by a percentage equal to the percentage increase in the Consumer Price Index between April 2020 and the April in the year prior to the beginning of such award year, and rounding the result to the nearest $5,000; and (B) by adjusting the dollar amounts in the column re- ferring to the adjusted net worth to reflect the changes made pursuant to subparagraph (A).
(d) ASSET PROTECTION ALLOWANCE.—For award year 2023– 2024 and each subsequent award year, the Secretary shall publish in the Federal Register a revised table of allowances for the purpose September 8, 2023 As Amended Through P.L.

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478 HIGHER EDUCATION ACT OF 1965 574 of sections 475(d)(2), 476(c)(2), and 477(c)(2).

Such revised table shall be developed by determining the present value cost, rounded to the nearest $100, of an annuity that would provide, for each age cohort of 40 and above, a supplemental income at age 65 (adjusted for inflation) equal to the difference between the moderate family in- come (as most recently determined by the Bureau of Labor Statis- tics), and the current average social security retirement benefits.
For each age cohort below 40, the allowance shall be computed by de- creasing the allowance for age 40, as updated, by one-fifteenth for each year of age below age 40 and rounding the result to the nearest $100.
In making such determinations— (1) the tables of allowances specified in sections 475(d)(2), 476(c)(2), and 477(c)(2) shall be considered to be for award year 2021–2022 for the purposes of calculating inflation; (2) inflation shall be presumed to be 6 percent per year; (3) the rate of return of an annuity shall be presumed to be 8 percent; and (4) the sales commission on an annuity shall be presumed to be 6 percent.
(e) ASSESSMENT SCHEDULES AND RATES.—For award year 2023–2024 and each subsequent award year, the Secretary shall publish in the Federal Register a revised table of assessments from adjusted available income for the purpose of sections 475(e) and 477(d).
Such revised table shall be developed— (1) by increasing each dollar amount that refers to adjusted available income by a percentage equal to the percentage in- crease in the Consumer Price Index between April 2020 and the April in the year prior to the beginning of such academic year, rounded to the nearest $100; and (2) by adjusting the other dollar amounts to reflect the changes made pursuant to paragraph (1).
(f) CONSUMER PRICE INDEX DEFINED.—In this section, the term ‘‘Consumer Price Index’’ means the Consumer Price Index for All Urban Consumers published by the Department of Labor.

Each an- nual update of tables to reflect changes in the Consumer Price Index shall be corrected for misestimation of actual changes in such Index in previous years.
(g) EMPLOYMENT EXPENSE ALLOWANCE.—For award year 2023– 2024 and each succeeding award year, the Secretary shall publish in the Federal Register a revised table of employment expense allow- ances for the purpose of sections 475(c)(4), 476(b)(3), and 477(b)(4).
Such revised table shall be developed by increasing the dollar amount specified in sections 475(c)(4), 476(b)(3), and 477(b)(4) by a percentage equal to the percentage increase in the Consumer Price Index, as defined in subsection (f), between April 2020 and the April in the year prior to the beginning of the award year and rounding the result to the nearest $10.
(h) CLARIFICATION FOR AWARD YEAR 2023–2024.—For award year 2023–2024, the Secretary shall determine adjusted amounts and prescribe revised tables with respect to the income protection, employment expense, and asset protection allowances and the as- sessment schedules under sections 475, 476, and 477, pursuant to this section.

The amounts and tables specified in sections 475, 476, and 477 with respect to such allowances and schedules shall only September 8, 2023 As Amended Through P.L.
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479 be used by the Secretary as a baseline for adjustments and table re- visions prescribed in accordance with this section.

SEC.

479. ø20 U.S.C.

1087ss¿ SIMPLIFIED NEEDS TESTS.


(a) SIMPLIFIED APPLICATION SECTION.— (1) IN GENERAL.—The Secretary shall develop and use an easily identifiable simplified application section as part of the common financial reporting form prescribed under section 483(a) for families described in subsections (b) and (c) of this section.
(2) REDUCED DATA REQUIREMENTS.—The simplified applica- tion form shall— (A) in the case of a family meeting the requirements of subsection (b)(1), permit such family to submit only the data elements required under subsection (b)(2) for the pur- poses of establishing eligibility for student financial aid under this part; and (B) in the case of a family meeting the requirements of subsection (c), permit such family to be treated as hav- ing an expected family contribution equal to zero for pur- poses of establishing such eligibility and to submit only the data elements required to make a determination under subsection (c).
(b) SIMPLIFIED NEEDS TEST.— (1) ELIGIBILITY.—An applicant is eligible to file a sim- plified form containing the elements required by paragraph (2) if— (A) in the case of an applicant who is a dependent stu- dent— (i) the student’s parents— (I) file, or are eligible to file, a form described in paragraph (3); (II) certify that the parents are not required to file a Federal income tax return; (III) include at least one parent who is a dis- located worker; or (IV) received, or the student received, benefits at some time during the previous 24-month period under a means-tested Federal benefit program as defined under subsection (d); and (ii) the total adjusted gross income of the parents (excluding any income of the dependent student) is less than $50,000; or (B) in the case of an applicant who is an independent student— (i) the student (and the student’s spouse, if any)— (I) files, or is eligible to file, a form described in paragraph (3); (II) certifies that the student (and the stu- dent’s spouse, if any) is not required to file a Fed- eral income tax return; (III) is a dislocated worker or has a spouse who is a dislocated worker; or September 8, 2023 As Amended Through P.L.
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479 HIGHER EDUCATION ACT OF 1965 576 (IV) received benefits at some time during the previous 24-month period under a means-tested Federal benefit program as defined under sub- section (d); and (ii) the adjusted gross income of the student (and the student’s spouse, if any) is less than $50,000.
(2) SIMPLIFIED TEST ELEMENTS.—The six elements to be used for the simplified needs analysis are— (A) adjusted gross income, (B) Federal taxes paid, (C) untaxed income and benefits, (D) the number of family members, (E) the number of family members in postsecondary education, and (F) an allowance (A) for State and other taxes, as de- fined in section 475(c)(2) for dependent students and in section 477(b)(2) for independent students with dependents other than a spouse, or (B) for State and other income taxes, as defined in section 476(b)(2) for independent stu- dents without dependents other than a spouse.
(3) QUALIFYING FORMS.—In the case of an independent stu- dent, the student, or in the case of a dependent student, the family, files a form described in this subsection, or subsection (c), as the case may be, if the student or family, as appropriate, files— (A) a form 1040A or 1040EZ (including any prepared or electronic version of such form) required pursuant to the Internal Revenue Code of 1986; (B) a form 1040 (including any prepared or electronic version of such form) required pursuant to the Internal Revenue Code of 1986, except that such form shall be con- sidered a qualifying form only if the student or family files such form in order to take a tax credit under section 25A of the Internal Revenue Code of 1986, and would otherwise be eligible to file a form described in subparagraph (A); or (C) an income tax return (including any prepared or electronic version of such return) required pursuant to the tax code of the Commonwealth of Puerto Rico, Guam, American Samoa, the Virgin Islands, the Republic of the Marshall Islands, the Federated States of Micronesia, or Palau.
(c) ZERO EXPECTED FAMILY CONTRIBUTION.—The Secretary shall consider an applicant to have an expected family contribution equal to zero if— (1) in the case of a dependent student— (A) the student’s parents— (i) file, or are eligible to file, a form described in subsection (b)(3); (ii) certify that the parents are not required to file a Federal income tax return; (iii) include at least one parent who is a dislocated worker; or (iv) received, or the student received, benefits at some time during the previous 24-month period under September 8, 2023 As Amended Through P.L.
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479 other than a spouse— a means-tested Federal benefit program as defined under subsection (d); and (B) the sum of the adjusted gross income of the par- ents is less than or equal to $23,000; or (2) in the case of an independent student with dependents (A) the student (and the student’s spouse, if any)— (i) files, or is eligible to file, a form described in subsection (b)(3); (ii) certifies that the student (and the student’s spouse, if any) is not required to file a Federal income tax return; (iii) is a dislocated worker or has a spouse who is a dislocated worker; or (iv) received benefits at some time during the pre- vious 24-month period under a means-tested Federal benefit program as defined under subsection (d); and (B) the sum of the adjusted gross income of the stu- dent and spouse (if appropriate) is less than or equal to $23,000.
An individual is not required to qualify or file for the earned in- come credit in order to be eligible under this subsection.

The Sec- retary shall annually adjust the income level necessary to qualify an applicant for the zero expected family contribution.

The income level shall be adjusted according to increases in the Consumer Price Index, as defined in section 478(f).
(d) DEFINITIONS.—In this section: (1) DISLOCATED WORKER.—The term ‘‘dislocated worker’’ has the meaning given the term in section 3 of the Workforce Innovation and Opportunity Act.
(2) MEANS-TESTED FEDERAL BENEFIT PROGRAM.—The term ‘‘means-tested Federal benefit program’’ means a mandatory spending program of the Federal Government, other than a program under this title, in which eligibility for the program’s benefits, or the amount of such benefits, are determined on the basis of income or resources of the individual or family seeking the benefit, and may include such programs as— (A) the supplemental security income program under title XVI of the Social Security Act (42 U.S.C.
1381 et seq.

); (B) the supplemental nutrition assistance program under the Food and Nutrition Act of 2008 (7 U.S.C.

2011 et seq.

); (C) the free and reduced price school lunch program established under the Richard B. Russell National School Lunch Act (42 U.S.C.

1751 et seq.

); (D) the program of block grants for States for tem- porary assistance for needy families established under part A of title IV of the Social Security Act (42 U.S.C.

601 et seq.
601 et seq.

); (E) the special supplemental nutrition program for women, infants, and children established by section 17 of the Child Nutrition Act of 1966 (42 U.S.C.

1786); and (F) other programs identified by the Secretary.

September 8, 2023 As Amended Through P.L.

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479 HIGHER EDUCATION ACT OF 1965 578 øNote: For currency of the version of section 479, see footnote that appears at the heading of part F of this title.

Upon such date, section 479 (as amended, including an amendment made by section 103(b)(3) of division R of Public Law 117–103) will read as follows: ¿ SEC.

479.

ELIGIBLE APPLICANTS EXEMPT FROM ASSET REPORTING.


(a) IN GENERAL.—Notwithstanding any other provision of law, this section shall be effective for each individual seeking to apply for Federal financial aid under this title, as part of the simplified ap- plication for Federal student financial aid under section 483, on or after July 1, 2024.
(b) APPLICANTS EXEMPT FROM ASSET REPORTING.— (1) IN GENERAL.—Except as provided in paragraph (3), in carrying out section 483, the Secretary shall not use asset infor- mation from an eligible applicant or, as applicable, the parent or spouse of an eligible applicant.
(2) ELIGIBLE APPLICANTS.—In this subsection, the term ‘‘eli- gible applicant’’ means an applicant who meets at least one of the following criteria: (A) Is an applicant who qualifies for an automatic zero student aid index or negative student aid index under sub- section (b) or (c) of section 473.
(B) Is an applicant who is a dependent student and the student’s parents have a total adjusted gross income (ex- cluding any income of the dependent student) that is less than $60,000 and do not file a Schedule A, B, D, E, F, or H (or equivalent successor schedules) with the Federal in- come tax return for the second preceding tax year, and— (i) do not file a Schedule C (or the equivalent suc- cessor schedule) with the Federal income tax return for the second preceding tax year; or (ii) file a Schedule C (or the equivalent successor schedule) with net business income of not more than a $10,000 loss or gain with the Federal income tax re- turn for the second preceding tax year.
(C) Is an applicant who is an independent student and the student (including the student’s spouse, if any) has a total adjusted gross income that is less than $60,000 and does not file a Schedule A, B, D, E, F, or H (or equivalent successor schedules), with the Federal income tax return for the second preceding tax year, and— (i) does not file a Schedule C (or the equivalent successor schedule) with the Federal income tax return for the second preceding tax year; or (ii) files a Schedule C (or the equivalent successor schedule) with net business income of not more than a $10,000 loss or gain with the Federal income tax re- turn for the second preceding tax year.
(D) Is an applicant who, at any time during the pre- vious 24-month period, received a benefit under a means- tested Federal benefit program (or whose parent or spouse received such a benefit, as applicable).

September 8, 2023 As Amended Through P.L.

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479 (3) SPECIAL RULE.—An eligible applicant shall not be ex- empt from asset reporting under this section if the applicant is a dependent student and the students’ parents do not— (A) reside in the United States or a United States terri- tory; or (B) file taxes in the United States or a United States territory, except if such nonfiling is due to not being re- quired to file a Federal tax return for the applicable tax year due to a low income.
(4) DEFINITIONS.—In this section: (A) SCHEDULE A.—The term ‘‘Schedule A’’ means a form or information by a taxpayer to report itemized deduc- tions.

(B) SCHEDULE B.—The term ‘‘Schedule B’’ means a form or information filed by a taxpayer to report interest and ordinary dividend income.

(C) SCHEDULE C.—The term ‘‘Schedule C’’ means a form or information filed by a taxpayer to report income or loss from a business operated or a profession practiced as a sole proprietor.
(D) SCHEDULE D.—The term ‘‘Schedule D’’ means a form or information filed by a taxpayer to report sales, ex- changes or some involuntary conversions of capital assets, certain capital gain distributions, and nonbusiness bad debts.

(E) SCHEDULE E.—The term ‘‘Schedule E’’ means a form or information filed by a taxpayer to report income from rental properties, royalties, partnerships, S corpora- tions, estates, trusts, and residual interests in real estate mortgage investment conduits.
(F) SCHEDULE F.—The term ‘‘Schedule F’’ means a form or information filed by a taxpayer to report farm in- come and expenses.

(G) SCHEDULE H.—The term ‘‘Schedule H’’ means a form or information filed by a taxpayer to report household employment taxes.

(H) MEANS-TESTED FEDERAL BENEFIT PROGRAM.—The term ‘‘means-tested Federal benefit program’’ means any of the following: (i) The supplemental security income program under title XVI of the Social Security Act (42 U.S.C.

1381 et seq.).
1381 et seq.).

(ii) The supplemental nutrition assistance program under the Food and Nutrition Act of 2008 (7 U.S.C.

2011 et seq.

), a nutrition assistance program carried out under section 19 of such Act (7 U.S.C.

2028), and a supplemental nutrition assistance program carried out under section 3(c) of the Act entitled ‘‘An Act to au- thorize appropriations for certain insular areas of the United States, and for other purposes’’ (Public Law 95– 348).
(iii) The program of block grants for States for temporary assistance for needy families established September 8, 2023 As Amended Through P.L.

117-286, Enacted December 27, 2022 HOLC G:\COMP\EDIII\HIGHER EDUCATION ACT OF 1965.XML Sec.

479A HIGHER EDUCATION ACT OF 1965 580 under part A of title IV of the Social Security Act (42 U.S.C.

601 et seq.).
601 et seq.).

(iv) The special supplemental nutrition program for women, infants, and children established by section 17 of the Child Nutrition Act of 1966 (42 U.S.C.

1786).

(v) The Medicaid program under title XIX of the Social Security Act (42 U.S.C.

1396 et seq.).

(vi) Federal housing assistance programs, includ- ing tenant-based assistance under section 8(o) of the United States Housing Act of 1937 (42 U.S.C.

1437f(o)), and public housing, as defined in section 3(b)(1) of such Act (42 U.S.C.
1437a(b)(1)).

(vii) Other means-tested programs determined by the Secretary to be approximately consistent with the income eligibility requirements of the means-tested pro- grams under clauses (i) through (vi).

SEC.

479A.

ø20 U.S.C.

1087tt¿ DISCRETION OF STUDENT FINANCIAL AID ADMINISTRATORS.
(a) IN GENERAL.—Nothing in this part shall be interpreted as limiting the authority of the financial aid administrator, on the basis of adequate documentation, to make adjustments on a case- by-case basis to the cost of attendance or the values of the data items required to calculate the expected student or parent contribu- tion (or both) to allow for treatment of an individual eligible appli- cant with special circumstances.
However, this authority shall not be construed to permit aid administrators to deviate from the con- tributions expected in the absence of special circumstances.
Special circumstances may include tuition expenses at an elementary or secondary school, medical, dental, or nursing home expenses not covered by insurance, unusually high child care or dependent care costs, recent unemployment of a family member or an independent student, a student or family member who is a dislocated worker (as defined in section 3 of the Workforce Innovation and Opportunity Act), the number of parents enrolled at least half-time in a degree, certificate, or other program leading to a recognized educational credential at an institution with a program participation agree- ment under section 487, a change in housing status that results in an individual being homeless (as defined in section 103 of the McKinney-Vento Homeless Assistance Act), or other changes in a family’s income, a family’s assets, or a student’s status.
Special cir- cumstances shall be conditions that differentiate an individual stu- dent from a class of students rather than conditions that exist across a class of students.

Adequate documentation for such adjust- ments shall substantiate such special circumstances of individual students.
In addition, nothing in this title shall be interpreted as limiting the authority of the student financial aid administrator in such cases (1) to request and use supplementary information about the financial status or personal circumstances of eligible applicants in selecting recipients and determining the amount of awards under this title, or (2) to offer a dependent student financial assist- ance under section 428H or a Federal Direct Unsubsidized Stafford Loan without requiring the parents of such student to file the fi- nancial aid form prescribed under section 483 if the student finan- September 8, 2023 As Amended Through P.L.
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479A cial aid administrator verifies that the parent or parents of such student have ended financial support of such student and refuse to file such form.
No student or parent shall be charged a fee for col- lecting, processing, or delivering such supplementary information.
(b) ADJUSTMENTS TO ASSETS TAKEN INTO ACCOUNT.—A student financial aid administrator shall be considered to be making a nec- essary adjustment in accordance with subsection (a) if— (1) the administrator makes adjustments excluding from family income any proceeds of a sale of farm or business assets of a family if such sale results from a voluntary or involuntary foreclosure, forfeiture, or bankruptcy or an involuntary liquida- tion; or (2) the administrator makes adjustments in the award level of a student with a disability so as to take into consider- ation the additional costs such student incurs as a result of such student’s disability.
(c) REFUSAL OR ADJUSTMENT OF LOAN CERTIFICATIONS.—On a case-by-case basis, an eligible institution may refuse to certify a statement that permits a student to receive a loan under part B or D, or may certify a loan amount or make a loan that is less than the student’s determination of need (as determined under this part), if the reason for the action is documented and provided in written form to the student.
No eligible institution shall discrimi- nate against any borrower or applicant in obtaining a loan on the basis of race, national origin, religion, sex, marital status, age, or disability status.

øNote: For currency of the version of section 479A, see footnote that appears at the heading of part F of this title.¿ SEC.

479A.

ƒ20 U.S.C.

1087tt≈ DISCRETION OF STUDENT FINANCIAL AID ADMINISTRATORS.
(a) IN GENERAL.— (1) AUTHORITY OF FINANCIAL AID ADMINISTRATORS.—A fi- nancial aid administrator shall have the authority to, on the basis of adequate documentation, make adjustments to any or all of the following on a case-by-case basis: (A) For an applicant with special circumstances under subsection (b) to— (i) the cost of attendance; (ii) the values of the data used to calculate the stu- dent aid index; or (iii) the values of the data used to calculate the Federal Pell Grant award.
(B) For an applicant with unusual circumstances under subsection (c), to the dependency status of such ap- plicant.

(2) LIMITATIONS ON AUTHORITY.— (A) USE OF AUTHORITY.—No institution of higher edu- cation or financial aid administrator shall maintain a pol- icy of denying all requests for adjustments under this sec- tion.

(B) NO ADDITIONAL FEE.—No student or parent shall be charged a fee for a documented interview of the student by September 8, 2023 As Amended Through P.L.
117-286, Enacted December 27, 2022 HOLC G:\COMP\EDIII\HIGHER EDUCATION ACT OF 1965.XML Sec.
479A HIGHER EDUCATION ACT OF 1965 582 the financial aid administrator or for the review of a stu- dent or parent’s request for adjustments under this section including the review of any supplementary information or documentation of a student or parent’s special cir- cumstances or a student’s unusual circumstances.
(C) RULE OF CONSTRUCTION.—The authority to make adjustments under paragraph (1)(A) shall not be construed to permit financial aid administrators to deviate from the cost of attendance, the values of data used to calculate the student aid index or the values of data used to calculate the Federal Pell Grant award (or both) for awarding aid under this title in the absence of special circumstances.
(3) ADEQUATE DOCUMENTATION.—Adequate documentation for adjustments under this section must substantiate the special circumstances or unusual circumstances of an individual stu- dent, and may include, to the extent relevant and appropriate— (A) a documented interview between the student and the financial aid administrator; (B) for the purposes of determining that a student qualifies for an adjustment under paragraph (1)(B)— (i) submission of a court order or official Federal or State documentation that the student or the stu- dent’s parents or legal guardians are incarcerated in any Federal or State penal institution; (ii) a documented phone call or a written state- the specific unusual cir- ment, which confirms cumstances with— (I) a child welfare agency authorized by a State or county; (II) a Tribal welfare authority or agency; (III) an independent living case worker, such as a case worker who supports current and former foster youth with the transition to adulthood; or (IV) a public or private agency, facility, or pro- gram servicing the victims of abuse, neglect, as- sault, or violence, which may include domestic vio- lence; (iii) a documented phone call or a written state- ment from an attorney, a guardian ad litem, or a court-appointed special advocate, or a person serving in a similar capacity which confirms the specific un- usual circumstances and documents the person’s rela- tionship to the student; (iv) a documented phone call or written statement from a representative under chapter 1 or 2 of subpart 2 of part A, which confirms the specific unusual cir- cumstances and documents the representative’s rela- tionship to the student; (v) documents, such as utility bills or health insur- ance documentation, that demonstrate a separation from parents or legal guardians; and (vi) in the absence of documentation described in this subparagraph, other documentation the financial aid administrator determines is adequate to confirm September 8, 2023 As Amended Through P.L.
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479A to section the unusual circumstances, pursuant 480(d)(9); and (C) supplementary information, as necessary, about the financial status or personal circumstances of eligible appli- cants as it relates to the special circumstances or unusual circumstances based on which the applicant is requesting an adjustment.
(4) SPECIAL RULE.—In making adjustments under para- graph (1), a financial aid administrator may offer a dependent student financial assistance under a Federal Direct Unsub- sidized Stafford Loan without requiring the parents of such stu- dent to provide their parent information on the Free Application for Federal Student Aid if the student does not qualify for, or does not choose to use, the unusual circumstance option de- scribed in section 480(d)(9), and the financial aid administrator determines that the parents of such student ended financial support of such student or refuse to file such form.
(5) PUBLIC DISCLOSURE.—Each institution of higher edu- cation shall make publicly available information that students applying for aid under this title have the opportunity to pursue adjustments under this section.
(b) ADJUSTMENTS FOR STUDENTS WITH SPECIAL CIR- CUMSTANCES.— (1) SPECIAL CIRCUMSTANCES FOR ADJUSTMENTS RELATED TO PELL GRANTS.—Special circumstances for adjustments to cal- culate a Federal Pell Grant award— (A) shall be conditions that differentiate an individual student from a group of students rather than conditions that exist across a group of students; and (B) may include— (i) recent unemployment of a family member or student; (ii) a student or family member who is a dislocated worker (as defined in section 3 of the Workforce Inno- vation and Opportunity Act); (iii) a change in housing status that results in an individual being a homeless youth; (iv) an unusual amount of claimed losses against income on the Federal tax return that substantially lower adjusted gross income, such as business, invest- ment, or real estate losses; (v) receipt of foreign income of permanent residents or United States citizens exempt from Federal taxation, or the foreign income for which a permanent resident or citizen received a foreign tax credit; (vi) in the case of an applicant who does not qual- ify for the exemption from asset reporting under section 479, assets as defined in section 480(f); or (vii) other changes or adjustments in the income, assets, or size of a family, or a student’s dependency status.
(2) SPECIAL CIRCUMSTANCES FOR ADJUSTMENTS RELATED TO COST OF ATTENDANCE AND STUDENT AID INDEX.—Special cir- September 8, 2023 As Amended Through P.L.

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479A HIGHER EDUCATION ACT OF 1965 584 cumstances for adjustments to the cost of attendance or the val- ues of the data used to calculate the student aid index— (A) shall be conditions that differentiate an individual student from a group of students rather than conditions that exist across a group of students, except as provided in sections 479B and 479C; and (B) may include— ondary school; covered by insurance; (i) tuition expenses at an elementary school or sec- (ii) medical, dental, or nursing home expenses not (iii) child care or dependent care costs not covered by the dependent care cost allowance calculated in ac- cordance with section 472; (iv) recent unemployment of a family member or student; (v) a student or family member who is a dislocated worker (as defined in section 3 of the Workforce Inno- vation and Opportunity Act); (vi) the existence of additional family members en- rolled in a degree, certificate, or other program leading to a recognized educational credential at an institution with a program participation agreement under section 487; (vii) a change in housing status that results in an individual being a homeless youth; (viii) a condition of severe disability of the student, or in the case of a dependent student, the dependent student’s parent or guardian, or in the case of an inde- pendent student, the independent student’s dependent or spouse; (ix) unusual amount of claimed losses against in- come on the Federal tax return that substantially lower adjusted gross income, such as business, investment, or real estate losses; or (x) other changes or adjustments in the income, as- sets, or size of a family, or a student’s dependency sta- tus.
(c) UNUSUAL CIRCUMSTANCES ADJUSTMENTS.— (1) IN GENERAL.—Unusual circumstances for adjustments to the dependency status of an applicant shall be— (A) conditions that differentiate an individual student from a group of students; and (B) based on unusual circumstances, pursuant to sec- tion 480(d)(9).
(2) PROVISIONAL INDEPENDENT STUDENTS.— (A) REQUIREMENTS FOR THE SECRETARY.—The Sec- retary shall— (i) enable each student who, based on an unusual circumstance described in section 480(d)(9), may qual- ify for an adjustment under subsection (a)(1)(B) that will result in a determination of independence under this section or section 479D to complete the Free Appli- cation for Federal Student Aid as an independent stu- September 8, 2023 As Amended Through P.L.
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479A dent for the purpose of a provisional determination of the student’s Federal financial aid award, with the final determination of the award subject to the docu- mentation requirements of subsection (a)(3); (ii) upon completion of the Free Application for Federal Student Aid provide an estimate of the stu- dent’s Federal Pell Grant award, and other informa- tion as specified in section 483(a)(3)(A), based on the assumption that the student is determined to be an independent student; and (iii) specify, on the Free Application for Federal Student Aid, the consequences under section 490(a) of knowingly and willfully completing the Free Applica- tion for Federal Student Aid as an independent student under clause (i) without meeting the unusual cir- cumstances to qualify for such a determination.
(B) REQUIREMENTS FOR FINANCIAL AID ADMINISTRA- TORS.—With respect to a student accepted for admission who completes the Free Application for Federal Student Aid as an independent student under subparagraph (A), a fi- nancial aid administrator shall— (i) notify the student of the institutional process, requirements, and timeline for an adjustment under this section and section 480(d)(9) that will result in a review of the student’s request for an adjustment and a determination of the student’s dependency status under such sections within a reasonable time after the student completes the Free Application for Federal Stu- dent Aid; (ii) provide the student a final determination of the student’s dependency status and Federal financial aid award as soon as practicable after all requested docu- mentation is provided; (iii) retain all documents related to the adjustment under this section and section 480(d)(9), including doc- umented interviews, for at least the duration of the stu- dent’s enrollment, and shall abide by all other record keeping requirements of this Act; and (iv) presume that any student who has obtained an adjustment under this section and section 480(d)(9) and a final determination of independence for any pre- ceding award year at an institution of higher education to be independent for each subsequent award year at the same institution unless— (I) the student informs the institution that cir- cumstances have changed; or (II) the institution has specific conflicting in- formation about the student’s independence.
(C) ELIGIBILITY.—If a student pursues provisional independent student status and is not determined to be an independent student by a financial aid administrator, such student shall only be eligible for a Federal Direct Unsub- sidized Stafford Loan for that award year unless such stu- September 8, 2023 As Amended Through P.L.
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479A HIGHER EDUCATION ACT OF 1965 586 dent subsequently completes the Free Application for Fed- eral Student Aid as a dependent student.
(d) ADJUSTMENTS TO ASSETS OR INCOME TAKEN INTO AC- COUNT.—A financial aid administrator shall be considered to be making a necessary adjustment in accordance with this section if— (1) the administrator makes adjustments excluding from family income or assets any proceeds or losses from a sale of farm or business assets of a family if such sale results from a voluntary or involuntary foreclosure, forfeiture, or bankruptcy or a voluntary or involuntary liquidation; or (2) the administrator makes adjustments for a condition of disability of a student, or in the case of a dependent student, the dependent student’s parent or guardian, or in the case of an independent student, the independent student’s dependent or spouse, so as to take into consideration the additional costs in- curred as a result of such disability.
(e) REFUSAL OR ADJUSTMENT OF LOAN CERTIFICATIONS.—On a case-by-case basis, an eligible institution may refuse to use the au- thority provided under this section, certify a statement that permits a student to receive a loan under part D, certify a loan amount, or make a loan that is less than the student’s determination of need (as determined under this part), if the reason for the action is docu- mented and provided in writing to the student.
No eligible institu- tion shall discriminate against any borrower or applicant in obtain- ing a loan on the basis of race, ethnicity, national origin, religion, sex, marital status, age, or disability status.
(f) SPECIAL RULE REGARDING PROFESSIONAL JUDGMENT DUR- ING A DISASTER, EMERGENCY, OR ECONOMIC DOWNTURN.— (1) IN GENERAL.—For the purposes of making a profes- sional judgment under this section, financial aid administra- tors may, during a qualifying emergency— (A) determine that the income earned from work for an applicant is zero, if the applicant can provide paper or elec- tronic documentation of receipt of unemployment benefits or confirmation that an application for unemployment benefits was submitted; and (B) make additional appropriate adjustments to the in- come earned from work for a student, parent, or spouse, as applicable, based on the totality of the family’s situation, including consideration of unemployment benefits.
(2) DOCUMENTATION.—For the purposes of documenting un- employment under paragraph (1), documentation shall be ac- cepted if such documentation is submitted not more than 90 days from the date on which such documentation was issued, except if a financial aid administrator knows that the student, parent, or spouse, as applicable, has already obtained other em- ployment.
(3) PROGRAM REVIEWS.—The Secretary shall make adjust- ments to the model used to select institutions of higher edu- cation participating under this title for program reviews in order to account for any rise in the use of professional judgment under this section during the award years applicable to the qualifying emergency, as determined by the Secretary.

September 8, 2023 As Amended Through P.L.


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479C (4) QUALIFYING EMERGENCY.—In this subsection, the term ‘‘qualifying emergency’’ means— (A) an event for which the President declared a major disaster or an emergency under section 401 or 501, respec- tively, of the Robert T. Stafford Disaster Relief and Emer- gency Assistance Act (42 U.S.C.

5170 and 5191); (B) a national emergency related to the coronavirus de- clared by the President under section 201 of the National Emergencies Act (50 U.S.C.

1601 et seq.
1601 et seq.

); or (C) a period of recession or economic downturn as de- termined by the Secretary, in consultation with the Sec- retary of Labor.

SEC.

479B.

ø20 U.S.C.

1087uu¿ DISREGARD OF STUDENT AID IN OTHER FEDERAL PROGRAMS.
Notwithstanding any other provision of law, student financial assistance received under this title, or under Bureau of Indian Af- fairs student assistance programs, shall not be taken into account in determining the need or eligibility of any person for benefits or assistance, or the amount of such benefits or assistance, under any Federal, State, or local program financed in whole or in part with Federal funds.
øNote: For currency of the version of section 479B, see footnote that appears at the heading of part F of this title.¿ SEC.

479B.

ƒ20 U.S.C.

1087uu≈ DISREGARD OF STUDENT AID IN OTHER PROGRAMS.

Notwithstanding any other provision of law, student financial assistance received under this title, Bureau of Indian Education stu- dent assistance programs, and employment and training programs under section 134 of the Workforce Innovation and Opportunity Act (29 U.S.C.

3174 et.

seq.)
3174 et.

seq.)

shall not be taken into account in deter- mining the need or eligibility of any person for benefits or assist- ance, or the amount of such benefits or assistance, under any Fed- eral, State, or local program financed in whole or in part with Fed- eral funds.

SEC.

479C.

ø20 U.S.C.

1087uu–1¿ NATIVE AMERICAN STUDENTS.


In determining family contributions for Native American stu- dents, computations performed pursuant to this part shall ex- clude— (1) any income and assets of $2,000 or less per individual payment received by the student (and spouse) and student’s parents under Public Law 98–64 (25 U.S.C.

117a et seq.

; 97 Stat.

365) (commonly known as the ‘‘Per Capita Act’’) or the In- dian Tribal Judgment Funds Use or Distribution Act (25 U.S.C.

1401 et seq.
1401 et seq.

); and (2) any income received by the student (and spouse) and student’s parents under the Alaska Native Claims Settlement Act (43 U.S.C.

1601 et seq.)

or the Maine Indian Claims Settle- ment Act of 1980 (25 U.S.C.

1721 et seq.).

September 8, 2023 As Amended Through P.L.

117-286, Enacted December 27, 2022 HOLC G:\COMP\EDIII\HIGHER EDUCATION ACT OF 1965.XML Sec.
479C HIGHER EDUCATION ACT OF 1965 588 øNote: For currency of the version of sections 479C and 479D, see footnote that appears at the heading of part F of this title.¿ SEC.

479C.

ƒ20 U.S.C.

1087uu–1≈ NATIVE AMERICAN STUDENTS.


(a) IN GENERAL.—In determining the student aid index for Na- tive American students, computations performed pursuant to this part shall exclude— (1) any income and assets of $2,000 or less per individual payment received by the student (and spouse) and student’s par- ents under Public Law 98–64 (25 U.S.C.

117a et seq.

; 97 Stat.

365) (commonly known as the ‘‘Per Capita Act’’) or the Indian Tribal Judgment Funds Use or Distribution Act (25 U.S.C.
1401 et seq.

); and (2) any income received by the student (and spouse) and student’s parents under the Alaska Native Claims Settlement Act (43 U.S.C.

1601 et seq.)

or the Maine Indian Claims Settle- ment Act of 1980 (25 U.S.C.

1721 et seq.).
1721 et seq.).

(b) GUIDANCE.—The Secretary shall develop guidance, in con- sultation with Tribal Colleges and Universities (as defined in sec- tion 316) and the State higher education agency in Alaska and Maine, to implement the determination under subsection (a) without adding additional questions to the FAFSA, including through the use of the authority under section 479A.

øNote: For currency of the version of sections 479C and 479D, see footnote that appears at the heading of part F of this title.
Upon such date, section 479D (as amended, including an amend- ment made by section 103(b) of division R of Public Law 117–103) will read as follows: ¿ SEC.

479D.

SPECIAL RULES FOR INDEPENDENT STUDENTS.
(a) DETERMINATION PROCESS FOR UNACCOMPANIED HOMELESS YOUTH.—In making a determination of independence under section 480(d)(8), a financial aid administrator shall comply with the fol- lowing: (1) Consider documentation of the student’s circumstance to be adequate in the absence of documented conflicting informa- tion, if such documentation is provided through a documented phone call, written statement, or verifiable electronic data match by— (A) a local educational agency homeless liaison, des- ignated pursuant to section 722(g)(1)(J)(ii) of the McKin- ney-Vento Homeless Assistance Act (42 U.S.C.
11432(g)(1)(J)(ii)) or a designee of the liaison; (B) the director of an emergency or transitional shelter, street outreach program, homeless youth drop-in center, or other program serving individuals who are experiencing homelessness, or a designee of the director; (C) the director of a project supported by a Federal TRIO program or a Gaining Early Awareness and Readi- ness for Undergraduate program grant under chapter 1 or 2 of subpart 2 of part A, or a designee of the director; or (D) a financial aid administrator at another institution who documented the student’s circumstance in the same or a prior award year.
September 8, 2023 As Amended Through P.L.

117-286, Enacted December 27, 2022 HOLC G:\COMP\EDIII\HIGHER EDUCATION ACT OF 1965.XML 589 HIGHER EDUCATION ACT OF 1965 Sec.
479D (2) If a student is unable to provide documentation from any individual described in paragraph (1), make a case-by-case determination, which shall be— (A) based on a written statement from, or a docu- mented interview with, the student that confirms that the student is an unaccompanied homeless youth, or unaccom- panied, at risk of homelessness, and self-supporting; and (B) made without regard to the reasons that the stu- dent is an unaccompanied homeless youth, or unaccom- panied, at risk of homelessness, and self-supporting.
(3) Consider a determination made under this subsection as distinct from a determination of independence under section 480(d)(9).
(b) DOCUMENTATION PROCESS FOR FOSTER CARE YOUTH.—If an institution requires that a student provide documentation that the student was in foster care when the student was age 13 or older, a financial aid administrator shall consider any of the following as adequate documentation, in the absence of documented conflicting information: (1) Submission of a court order or official State documenta- tion that the student received Federal or State support in foster care.
(2) A documented phone call, written statement, or verifiable electronic data match, which confirms the student was in foster care at an applicable age, from— (A) a State, county, or tribal agency administering a program under part B or E of title IV of the Social Security Act (42 U.S.C.

621 et seq.

and 670 et seq.

); (B) a State Medicaid agency; or (C) a public or private foster care placing agency or fos- ter care facility or placement.
(3) A documented phone call or a written statement from an attorney, a guardian ad litem, or a Court Appointed Special Advocate that confirms that the student was in foster care at an applicable age and documents the person’s relationship to the student.

(4) Verification of the student’s eligibility for an education and training voucher under the John H. Chafee Foster Care Program under section 477 of the Social Security Act (42 U.S.C.

677).
677).

(5) A documented phone call or written statement from a fi- nancial aid administrator who documented the student’s cir- cumstance in the same or a prior award year.
(c) TIMING.—A determination of independence under paragraph (2), (8), or (9) of section 480(d) for a student— (1) shall be made as quickly as practicable; (2) may be made as early as the year before the award year for which the student initially submits an application; and (3) shall be made not later than 60 days after the date of the student’s enrollment during the award year for which the student initially submits an application.
(d) USE OF EARLIER DETERMINATIONS.— (1) EARLIER DETERMINATION BY THE INSTITUTION.—Any student who is determined to be independent under paragraph September 8, 2023 As Amended Through P.L.

117-286, Enacted December 27, 2022 HOLC G:\COMP\EDIII\HIGHER EDUCATION ACT OF 1965.XML Sec.
480 HIGHER EDUCATION ACT OF 1965 590 (2), (8), or (9) of section 480(d) for a preceding award year at an institution shall be presumed to be independent for each subsequent award year at the same institution unless— (A) the student informs the institution that cir- cumstances have changed; or (B) the institution has specific conflicting information about the student’s independence and has informed the stu- dent of this information.
(2) EARLIER DETERMINATION BY ANOTHER INSTITUTION.—A financial aid administrator may make a determination of inde- pendence pursuant to section 479A(c), this section, or paragraph (2), (8), or (9) of section 480(d), based upon a documented deter- mination of independence that was previously made by another financial aid administrator under such provisions in the same or a prior award year.
(e) RETENTION OF DOCUMENTS.—A financial aid administrator shall retain all documents related to any determination of inde- pendence, including documented interviews, for at least the dura- tion of the student’s enrollment and an additional period prescribed by the Secretary to enable a student to utilize the documents for the purposes of subsection (a)(1)(D), (b)(5), or (d) of this section.

SEC.

480. ø20 U.S.C.

1087vv¿ DEFINITIONS.


As used in this part: (a) TOTAL INCOME.—(1)(A) Except as provided in subparagraph (B) and paragraph (2), the term ‘‘total income’’ is equal to adjusted gross income plus untaxed income and benefits for the preceding tax year minus excludable income (as defined in subsection (e)).
(B) Notwithstanding section 478(a), the Secretary may provide for the use of data from the second preceding tax year when and to the extent necessary to carry out the simplification of applica- tions (including simplification for a subset of applications) used for the estimation and determination of financial aid eligibility.

Such simplification may include the sharing of data between the Internal Revenue Service and the Department, pursuant to the consent of the taxpayer.
(2) No portion of any student financial assistance received from any program by an individual, no portion of veterans’ education benefits received by an individual, no portion of a national service educational award or post-service benefit received by an individual under title I of the National and Community Service Act of 1990 (42 U.S.C.

12511 et seq.
12511 et seq.

), no portion of any tax credit taken under section 25A of the Internal Revenue Code of 1986, and no distribu- tion from any qualified education benefit described in subsection (f)(3) that is not subject to Federal income tax, shall be included as income or assets in the computation of expected family contribu- tion for any program funded in whole or in part under this Act.
(b) UNTAXED INCOME AND BENEFITS.— (1) The term ‘‘untaxed income and benefits’’ means— (A) child support received; (B) workman’s compensation; (C) veteran’s benefits such as death pension, depend- ency, and indemnity compensation, but excluding veterans’ education benefits as defined in subsection (c); September 8, 2023 As Amended Through P.L.
117-286, Enacted December 27, 2022 HOLC G:\COMP\EDIII\HIGHER EDUCATION ACT OF 1965.XML 591 HIGHER EDUCATION ACT OF 1965 Sec.
480 (D) interest on tax-free bonds; (E) housing, food, and other allowances (excluding rent subsidies for low-income housing) for military, clergy, and others (including cash payments and cash value of bene- fits), except that the value of on-base military housing or the value of basic allowance for housing determined under section 403(b) of title 37, United States Code, received by the parents, in the case of a dependent student, or the stu- dent or student’s spouse, in the case of an independent student, shall be excluded; (F) cash support or any money paid on the student‘s behalf, except, for dependent students, funds provided by the student’s parents; (G) untaxed portion of pensions; (H) payments to individual retirement accounts and Keogh accounts excluded from income for Federal income tax purposes; and (I) any other untaxed income and benefits, such as Black Lung Benefits, Refugee Assistance, or railroad re- tirement benefits, or benefits received through participa- tion in employment and training activities under title I of the Workforce Innovation and Opportunity Act.
(2) The term ‘‘untaxed income and benefits’’ shall not in- clude— (A) the amount of additional child tax credit claimed for Federal income tax purposes; (B) welfare benefits, including assistance under a State program funded under part A of title IV of the Social Security Act and aid to dependent children; (C) the amount of earned income credit claimed for Federal income tax purposes; (D) the amount of credit for Federal tax on special fuels claimed for Federal income tax purposes; (E) the amount of foreign income excluded for pur- poses of Federal income taxes; or (F) untaxed social security benefits.
(c) VETERAN AND VETERANS’ EDUCATION BENEFITS.—(1) The term ‘‘veteran’’ means any individual who— (A) has engaged in the active duty in the United States Army, Navy, Air Force, Marines, or Coast Guard; and (B) was released under a condition other than dishonor- able.
(2) The term ‘‘veterans’ education benefits’’ means veterans’ benefits the student will receive during the award year, including but not limited to benefits under the following provisions of law: (A) Chapter 103 of title 10, United States Code (Senior Re- serve Officers’ Training Corps).

(B) Chapter 106A of title 10, United States Code (Edu- cational Assistance for Persons Enlisting for Active Duty).

(C) Chapter 1606 of title 10, United States Code (Selected Reserve Educational Assistance Program).
(D) Chapter 1607 of title 10, United States Code (Edu- cational Assistance Program for Reserve Component Members September 8, 2023 As Amended Through P.L.

117-286, Enacted December 27, 2022 HOLC G:\COMP\EDIII\HIGHER EDUCATION ACT OF 1965.XML Sec.

480 HIGHER EDUCATION ACT OF 1965 592 Supporting Contingency Operations and Certain Other Oper- ations).
(E) Chapter 30 of title 38, United States Code (All-Volun- teer Force Educational Assistance Program, also known as the ‘‘Montgomery GI Bill—active duty’’).

(F) Chapter 31 of title 38, United States Code (Training and Rehabilitation for Veterans with Service-Connected Dis- abilities).

(G) Chapter 32 of title 38, United States Code (Post-Viet- nam Era Veterans’ Educational Assistance Program).

(H) Chapter 33 of title 38, United States Code (Post-9/11 Educational Assistance).
(I) Chapter 35 of title 38, United States Code (Survivors’ and Dependents’ Educational Assistance Program).

(J) Section 903 of the Department of Defense Authoriza- tion Act, 1981 (10 U.S.C.

2141 note) (Educational Assistance Pilot Program).

(K) Section 156(b) of the ‘‘Joint Resolution making further continuing appropriations and providing for productive employ- ment for the fiscal year 1983, and for other purposes’’ (42 U.S.C.
402 note) (Restored Entitlement Program for Survivors, also known as ‘‘Quayle benefits’’).

(L) The provisions of chapter 3 of title 37, United States Code, related to subsistence allowances for members of the Re- serve Officers Training Corps.
(d) INDEPENDENT STUDENT.— (1) DEFINITION.—The term ‘‘independent’’, when used with respect to a student, means any individual who— (A) is 24 years of age or older by December 31 of the award year; (B) is an orphan, in foster care, or a ward of the court, or was an orphan, in foster care, or a ward of the court at any time when the individual was 13 years of age or older; (C) is, or was immediately prior to attaining the age of majority, an emancipated minor or in legal guardianship as determined by a court of competent jurisdiction in the individual’s State of legal residence; (D) is a veteran of the Armed Forces of the United States (as defined in subsection (c)(1)) or is currently serv- ing on active duty in the Armed Forces for other than training purposes; (E) is a graduate or professional student; (F) is a married individual; (G) has legal dependents other than a spouse; (H) has been verified during the school year in which the application is submitted as either an unaccompanied youth who is a homeless child or youth (as such terms are defined in section 725 of the McKinney-Vento Homeless Assistance Act), or as unaccompanied, at risk of homeless- ness, and self-supporting, by— (i) a local educational agency homeless liaison, designated pursuant to section 722(g)(1)(J)(ii) of the McKinney-Vento Homeless Assistance Act; September 8, 2023 As Amended Through P.L.
117-286, Enacted December 27, 2022 HOLC G:\COMP\EDIII\HIGHER EDUCATION ACT OF 1965.XML 593 HIGHER EDUCATION ACT OF 1965 Sec.
480 (ii) the director of a program funded under the Runaway and Homeless Youth Act or a designee of the director; (iii) the director of a program funded under sub- title B of title IV of the McKinney-Vento Homeless As- sistance Act (relating to emergency shelter grants) or a designee of the director; or (iv) a financial aid administrator; or (I) is a student for whom a financial aid administrator makes a documented determination of independence by reason of other unusual circumstances.
(2) SIMPLIFYING THE DEPENDENCY OVERRIDE PROCESS.—A financial aid administrator may make a determination of inde- pendence under paragraph (1)(I) based upon a documented de- termination of independence that was previously made by an- other financial aid administrator under such paragraph in the same award year.
(e) EXCLUDABLE INCOME.—The term ‘‘excludable income’’ means— (1) any student financial assistance awarded based on need as determined in accordance with the provisions of this part, including any income earned from work under part C of this title; (2) any income earned from work under a cooperative edu- cation program offered by an institution of higher education; (3) any living allowance received by a participant in a pro- gram established under the National and Community Service Act of 1990; (4) child support payments made by the student or parent; (5) payments made and services provided under part E of title IV of the Social Security Act; and (6) special combat pay.
(f) ASSETS.—(1) The term ‘‘assets’’ means cash on hand, includ- ing the amount in checking and savings accounts, time deposits, money market funds, trusts, stocks, bonds, other securities, mutual funds, tax shelters, qualified education benefits (except as provided in paragraph (3)), and the net value of real estate, income pro- ducing property, and business and farm assets.
(2) With respect to determinations of need under this title, other than for subpart 4 of part A, the term ‘‘assets’’ shall not in- clude the net value of— (A) the family’s principal place of residence; (B) a family farm on which the family resides; or (C) a small business with not more than 100 full-time or full-time equivalent employees (or any part of such a small business) that is owned and controlled by the family.
(3) A qualified education benefit shall be considered an asset of— (A) the student if the student is an independent stu- dent; or (B) the parent if the student is a dependent student, regardless of whether the owner of the account is the stu- dent or the parent.

September 8, 2023 As Amended Through P.L.

117-286, Enacted December 27, 2022 HOLC G:\COMP\EDIII\HIGHER EDUCATION ACT OF 1965.XML Sec.
480 HIGHER EDUCATION ACT OF 1965 594 (4) In determining the value of assets in a determination of need under this title (other than for subpart 4 of part A), the value of a qualified education benefit shall be— (A) the refund value of any tuition credits or certificates purchased under a qualified education benefit; and (B) in the case of a program in which contributions are made to an account that is established for the purpose of meet- ing the qualified higher education expenses of the designated beneficiary of the account, the current balance of such account.
(5) In this subsection: (A) The term ‘‘qualified education benefit’’ means— (i) a qualified tuition program (as defined in section 529(b)(1)(A) of the Internal Revenue Code of 1986) or other prepaid tuition plan offered by a State; and (ii) a Coverdell education savings account (as defined in section 530(b)(1) of the Internal Revenue Code of 1986).

(B) The term ‘‘qualified higher education expenses’’ has the meaning given the term in section 529(e) of the Internal Rev- enue Code of 1986.
(g) NET ASSETS.—The term ‘‘net assets’’ means the current market value at the time of application of the assets (as defined in subsection (f)), minus the outstanding liabilities or indebtedness against the assets.
(h) TREATMENT OF INCOME TAXES PAID TO OTHER JURISDIC- TIONS.—(1) The tax on income paid to the Governments of the Com- monwealth of Puerto Rico, Guam, American Samoa, the Virgin Is- lands, or the Commonwealth of the Northern Mariana Islands, the Republic of the Marshall Islands, the Federated States of Micro- nesia, or Palau under the laws applicable to those jurisdictions, or the comparable tax paid to the central government of a foreign country, shall be treated as Federal income taxes.
(2) References in this part to the Internal Revenue Code of 1986, Federal income tax forms, and the Internal Revenue Service shall, for purposes of the tax described in paragraph (1), be treated as references to the corresponding laws, tax forms, and tax collec- tion agencies of those jurisdictions, respectively, subject to such ad- justments as the Secretary may provide by regulation.
(i) CURRENT BALANCE.—The term ‘‘current balance of checking and savings accounts’’ does not include any funds over which an in- dividual is barred from exercising discretion and control because of the actions of any State in declaring a bank emergency due to the insolvency of a private deposit insurance fund.
(j) OTHER FINANCIAL ASSISTANCE.—(1) For purposes of deter- mining a student’s eligibility for funds under this title, estimated financial assistance not received under this title shall include all scholarships, grants, loans, or other assistance known to the insti- tution at the time the determination of the student’s need is made, including national service educational awards or post-service bene- fits under title I of the National and Community Service Act of 1990 (42 U.S.C.

12511 et seq.
12511 et seq.

), but excluding veterans’ education benefits as defined in subsection (c).

(2) Notwithstanding paragraph (1), a tax credit taken under section 25A of the Internal Revenue Code of 1986, or a distribution that is not includable in gross income under section 529 of such September 8, 2023 As Amended Through P.L.
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480 Code, under another prepaid tuition plan offered by a State, or under a Coverdell education savings account under section 530 of such Code, shall not be treated as estimated financial assistance for purposes of section 471(3).
(3) Notwithstanding paragraph (1) and section 472, assistance not received under this title may be excluded from both estimated financial assistance and cost of attendance, if that assistance is provided by a State and is designated by such State to offset a spe- cific component of the cost of attendance.

If that assistance is ex- cluded from either estimated financial assistance or cost of attend- ance, it shall be excluded from both.
(4) Notwithstanding paragraph (1), special combat pay shall not be treated as estimated financial assistance for pur- poses of section 471(3).
(k) DEPENDENTS.—(1) Except as otherwise provided, the term ‘‘dependent of the parent’’ means the student, dependent children of the student’s parents, including those children who are deemed to be dependent students when applying for aid under this title, and other persons who live with and receive more than one-half of their support from the parent and will continue to receive more than half of their support from the parent during the award year.
(2) Except as otherwise provided, the term ‘‘dependent of the student’’ means the student’s dependent children and other persons (except the student’s spouse) who live with and receive more than one-half of their support from the student and will continue to re- ceive more than half of their support from the student during the award year.
(l) FAMILY SIZE.—(1) In determining family size in the case of a dependent student— (A) if the parents are not divorced or separated, family members include the student’s parents, and the dependents of the student’s parents including the student; (B) if the parents are divorced or separated, family mem- bers include the parent whose income is included in computing available income and that parent’s dependents, including the student; and (C) if the parents are divorced and the parent whose in- come is so included is remarried, or if the parent was a widow or widower who has remarried, family members also include, in addition to those individuals referred to in subparagraph (B), the new spouse and any dependents of the new spouse if that spouse’s income is included in determining the parents’ adjusted available income.
(2) In determining family size in the case of an independent student— (A) family members include the student, the student’s spouse, and the dependents of the student; and (B) if the student is divorced or separated, family members do not include the spouse (or ex-spouse), but do include the student and the student’s dependents.
(m) BUSINESS ASSETS.—The term ‘‘business assets’’ means property that is used in the operation of a trade or business, in- cluding real estate, inventories, buildings, machinery, and other equipment, patents, franchise rights, and copyrights.

September 8, 2023 As Amended Through P.L.

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480 HIGHER EDUCATION ACT OF 1965 596 (n) SPECIAL COMBAT PAY.—The term ‘‘special combat pay’’ means pay received by a member of the Armed Forces because of exposure to a hazardous situation.

øNote: For currency of the version of section 480, see footnote that appears at the heading of part F of this title.¿ SEC.

480. ƒ20 U.S.C.

1087vv≈ DEFINITIONS.


In this part: (a) TOTAL INCOME.—The term ‘‘total income’’ means the amount equal to adjusted gross income for the second preceding tax year plus untaxed income and benefits for the second preceding tax year minus excludable income for the second preceding tax year.
The fac- tors used to determine total income shall be derived from the Fed- eral income tax return, if available, except for the applicant’s ability to indicate a qualified rollover in the second preceding tax year as outlined in section 483 or foreign income described in subsection (b)(5).
(b) UNTAXED INCOME AND BENEFITS.—The term ‘‘untaxed in- come and benefits’’ means— (1) deductions and payments to self-employed SEP, SIM- PLE, Keogh, and other qualified individual retirement accounts excluded from income for Federal tax purposes, except such term shall not include payments made to tax-deferred pension and retirement plans, paid directly or withheld from earnings, that are not delineated on the Federal tax return; (2) tax-exempt interest income; (3) untaxed portion of individual retirement account dis- tributions; (4) untaxed portion of pensions; and (5) foreign income of permanent residents of the United States or United States citizens exempt from Federal taxation, or the foreign income for which such a permanent resident or citizen receives a foreign tax credit.
(c) VETERANS AND VETERANS’ EDUCATION BENEFITS.—(1) The term ‘‘veteran’’ has the meaning given the term in section 101(2) of title 38, United States Code, and includes individuals who served in the United States Armed Forces as described in sections 101(21), 101(22), and 101(23) of title 38, United States Code.
(2) The term ‘‘veterans’’ education benefits’ means veterans’ ben- efits under the following provisions of law: (A) Chapter 103 of title 10, United States Code (Senior Re- serve Officers’ Training Corps).

(B) Chapter 106A of title 10, United States Code (Edu- cational Assistance for Persons Enlisting for Active Duty).

(C) Chapter 1606 of title 10, United States Code (Selected Reserve Educational Assistance Program).
(D) Chapter 1607 of title 10, United States Code (Edu- cational Assistance Program for Reserve Component Members Supporting Contingency Operations and Certain Other Oper- ations).

(E) Chapter 30 of title 38, United States Code (All-Volun- teer Force Educational Assistance Program, also known as the ‘‘Montgomery GI Bill—active duty’’).

September 8, 2023 As Amended Through P.L.


117-286, Enacted December 27, 2022 HOLC G:\COMP\EDIII\HIGHER EDUCATION ACT OF 1965.XML 597 HIGHER EDUCATION ACT OF 1965 Sec.

480 (F) Chapter 31 of title 38, United States Code (Training and Rehabilitation for Veterans with Service-Connected Dis- abilities).
(G) Chapter 32 of title 38, United States Code (Post-Viet- nam Era Veterans’ Educational Assistance Program).

(H) Chapter 33 of title 38, United States Code (Post-9/11 Educational Assistance).

(I) Chapter 35 of title 38, United States Code (Survivors’ and Dependents’ Educational Assistance Program).

(J) Section 903 of the Department of Defense Authorization Act, 1981 (10 U.S.C.

2141 note) (Educational Assistance Pilot Program).


(K) Section 156(b) of the ‘‘Joint Resolution making further continuing appropriations and providing for productive employ- ment for the fiscal year 1983, and for other purposes’’ (42 U.S.C.

402 note) (Restored Entitlement Program for Survivors, also known as ‘‘Quayle benefits’’).

(L) The provisions of chapter 3 of title 37, United States Code, related to subsistence allowances for members of the Re- serve Officers Training Corps.
(d) INDEPENDENT STUDENTS AND DETERMINATIONS.—The term ‘‘independent’’, when used with respect to a student, means any in- dividual who— (1) is 24 years of age or older by December 31 of the award year; (2) is, or was at any time when the individual was 13 years of age or older— (A) an orphan; (B) a ward of the court; or (C) in foster care; (3) is, or was immediately prior to attaining the age of ma- jority, an emancipated minor or in legal guardianship as deter- mined by a court of competent jurisdiction in the individual’s State of legal residence; (4) is a veteran of the Armed Forces of the United States (as defined in subsection (c)) or is currently serving on active duty in the Armed Forces for other than training purposes; (5) is a graduate or professional student; (6) is married and not separated; (7) has legal dependents other than a spouse; (8) is an unaccompanied homeless youth or is unaccom- panied, at risk of homelessness, and self-supporting, without re- gard to such individual’s age; and (9) is a student for whom a financial aid administrator makes a documented determination of independence by reason of other unusual circumstances pursuant to section 479A(c) in which the student is unable to contact a parent or where contact with parents poses a risk to such student, which includes cir- cumstances of— (A) human trafficking, as described in the Trafficking Victims Protection Act of 2000 (22 U.S.C.
7101 et seq.

); (B) legally granted refugee or asylum status; (C) parental abandonment or estrangement; or (D) student or parental incarceration.

September 8, 2023 As Amended Through P.L.

117-286, Enacted December 27, 2022 HOLC G:\COMP\EDIII\HIGHER EDUCATION ACT OF 1965.XML Sec.
480 HIGHER EDUCATION ACT OF 1965 598 means— (e) EXCLUDABLE INCOME.—The term ‘‘excludable income’’ (1) an amount equal to the education credits described in paragraphs (1) and (2) of section 25A(a) of the Internal Revenue Code of 1986; (2) if an applicant elects to report it, college grant and scholarship aid included in gross income on a Federal tax re- turn, including amounts attributable to grant and scholarship portions of fellowships and assistantships and any national service educational award or post-service benefit received by an individual under title I of the National and Community Service Act of 1990 (42 U.S.C.
12511 et seq.

), including awards, living allowances, and interest accrual payments; and (3) income earned from work under part C of this title.
(f) ASSETS.— (1) IN GENERAL.—The term ‘‘assets’’ means the amount in checking and savings accounts, time deposits, money market funds, investments, trusts, stocks, bonds, derivatives, securities, mutual funds, tax shelters, qualified education benefits (except as provided in paragraph (3)), the annual amount of child sup- port received and the net value of real estate, vacation homes, income producing property, and business and farm assets, de- termined in accordance with section 478(c).
(2) EXCLUSIONS.—With respect to determinations of need under this title, the term ‘‘assets’’ shall not include the net value of the family’s principal place of residence.
(3) CONSIDERATION OF QUALIFIED EDUCATION BENEFIT.—A qualified education benefit shall be considered an asset of— (A) the student if the student is an independent stu- dent; or (B) the parent if the student is a dependent student and the account is designated for the student, regardless of whether the owner of the account is the student or the par- ent.
(4) DEFINITION OF QUALIFIED EDUCATION BENEFIT.—In this subsection, the term ‘‘qualified education benefit’’ means— (A) a qualified tuition program (as defined in section 529(b)(1)(A) of the Internal Revenue Code of 1986) or other prepaid tuition plan offered by a State; and (B) a Coverdell education savings account (as defined in section 530(b)(1) of the Internal Revenue Code of 1986).
(g) NET VALUE.—The term ‘‘net value’’ means the market value at the time of application of the assets (as defined in subsection (f)), minus the outstanding liabilities or indebtedness against the assets.
(h) TREATMENT OF INCOME TAXES PAID TO OTHER JURISDIC- TIONS.— (1) The tax on income paid to the Governments of the Com- monwealth of Puerto Rico, Guam, American Samoa, the Virgin Islands, or the Commonwealth of the Northern Mariana Is- lands, the Republic of the Marshall Islands, the Federated States of Micronesia, or Palau under the laws applicable to those jurisdictions, or the comparable tax paid to the central government of a foreign country, shall be treated as Federal in- come taxes.
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480 (2) References in this part to the Internal Revenue Code of 1986, Federal income tax forms, and the Internal Revenue Serv- ice shall, for purposes of the tax described in paragraph (1), be treated as references to the corresponding laws, tax forms, and tax collection agencies of those jurisdictions, respectively, sub- ject to such adjustments as the Secretary may provide by regu- lation.
(i) OTHER FINANCIAL ASSISTANCE.— (1) For purposes of determining a student’s eligibility for funds under this title, other financial assistance not received under this title shall include all scholarships, grants, loans, or other assistance known to the institution at the time the deter- mination of the student’s need is made, including national serv- ice educational awards or post-service benefits under title I of the National and Community Service Act of 1990 (42 U.S.C.

12511 et seq.
12511 et seq.

), but excluding veterans’ education benefits.

(2) Notwithstanding paragraph (1), a tax credit taken under section 25A of the Internal Revenue Code of 1986, or a distribution that is not includable in gross income under sec- tion 529 of such Code, under another prepaid tuition plan of- fered by a State, or under a Coverdell education savings ac- count under section 530 of such Code, shall not be treated as other financial assistance for purposes of section 471(a)(3).
(3) Notwithstanding paragraph (1) and section 472, assist- ance not received under this title may be excluded from both other financial assistance and cost of attendance, if that assist- ance is provided by a State and is designated by such State to offset a specific component of the cost of attendance.

If that as- sistance is excluded from either other financial assistance or cost of attendance, it shall be excluded from both.
(4) Notwithstanding paragraph (1), payments made and services provided under part E of title IV of the Social Security Act to or on behalf of any child or youth over whom the State agency has responsibility for placement, care, or supervision, in- cluding the value of vouchers for education and training and amounts expended for room and board for youth who are not in foster care but are receiving services under section 477 of such Act, shall not be treated as other financial assistance for purposes of section 471(a)(3).
(5) Notwithstanding paragraph (1), emergency financial as- sistance provided to the student for unexpected expenses that are a component of the student’s cost of attendance, and not otherwise considered when the determination of the student’s need is made, shall not be treated as other financial assistance for purposes of section 471(a)(3).
(j) DEPENDENTS.— (1) Except as otherwise provided, the term ‘‘dependent of the parent’’ means the student who is deemed to be a dependent stu- dent when applying for aid under this title, and any other per- son who lives with and receives more than one-half of their sup- port from the parent (or parents) and will continue to receive more than half of their support from the parent (or parents) during the award year.

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480 HIGHER EDUCATION ACT OF 1965 600 (2) Except as otherwise provided, the term ‘‘dependent of the student’’ means the student’s dependent children and other per- sons (except the student’s spouse) who live with and receive more than one-half of their support from the student and will continue to receive more than half of their support from the stu- dent during the award year.
(k) FAMILY SIZE.— (1) DEPENDENT STUDENT.—Except as provided in para- graph (3), in determining family size in the case of a dependent student— (A) if the parents are not divorced or separated, family members include the student’s parents, and any dependent (within the meaning of section 152 of the Internal Revenue Code of 1986 or an eligible individual for purposes of the credit under section 24 of the Internal Revenue Code of 1986) of the student’s parents for the taxable year used in determining the amount of need of the student for financial assistance under this title; (B) if the parents are divorced or separated, family members include the parent whose income is included in computing available income and any dependent (within the meaning of section 152 of the Internal Revenue Code of 1986 or an eligible individual for purposes of the credit under section 24 of the Internal Revenue Code of 1986) of that parent for the taxable year used in determining the amount of need of the student for financial assistance under this title; (C) if the parents are divorced and the parents whose income is so included are remarried, or if the parent was a widow or widower who has remarried, family members also include, in addition to those individuals referred to in subparagraph (B), the new spouse and any dependent (within the meaning of section 152 of the Internal Revenue Code of 1986 or an eligible individual for purposes of the credit under section 24 of the Internal Revenue Code of 1986) of the new spouse for the taxable year used in deter- mining the amount of need of the student for financial as- sistance under this title, if that spouse’s income is included in determining the parent’s adjusted available income; and (D) if the student is not considered as a dependent (within the meaning of section 152 of the Internal Revenue Code of 1986 or an eligible individual for purposes of the credit under section 24 of the Internal Revenue Code of 1986) of any parent, the parents’ family size shall include the student and the family members applicable to the par- ents’ situation under subparagraph (A), (B), or (C).
(2) INDEPENDENT STUDENT.—Except as provided in para- graph (3), in determining family size in the case of an inde- pendent student— (A) family members include the student, the student’s spouse, and any dependent (within the meaning of section 152 of the Internal Revenue Code of 1986 or an eligible in- dividual for purposes of the credit under section 24 of the Internal Revenue Code of 1986) of that student for the tax- September 8, 2023 As Amended Through P.L.
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481 able year used in determining the amount of need of the student for financial assistance under this title; and (B) if the student is divorced or separated, family mem- bers do not include the spouse (or ex-spouse), but do include the student and any dependent (within the meaning of sec- tion 152 of the Internal Revenue Code of 1986 or an eligible individual for purposes of the credit under section 24 of the Internal Revenue Code of 1986) of that student for the tax- able year used in determining the amount of need of the student for financial assistance under this title.
(3) PROCEDURES AND MODIFICATION.—The Secretary shall provide procedures for determining family size in cases in which information for the taxable year used in determining the amount of need of the student for financial assistance under this title has changed or does not accurately reflect the appli- cant’s current household size, including when a divorce settle- ment only allows a parent to file for the Earned Income Tax Credit available under section 32 of the Internal Revenue Code of 1986.
(l) BUSINESS ASSETS.—The term ‘‘business assets’’ means prop- erty that is used in the operation of a trade or business, including real estate, inventories, buildings, machinery, and other equipment, patents, franchise rights, and copyrights.

(m) HOMELESS YOUTH.—The term ‘‘homeless youth’’ has the meaning given the term ‘‘homeless children and youths’’ in section 725 of the McKinney-Vento Homeless Assistance Act (42 U.S.C.

11434a).
11434a).

(n) UNACCOMPANIED.—The terms ‘‘unaccompanied’’, ‘‘unaccom- panied youth’’, or ‘‘unaccompanied homeless youth’’ have the mean- ing given the term ‘‘unaccompanied youth’’ in section 725 of the McKinney-Vento Homeless Assistance Act (42 U.S.C.

11434a).

PART G—GENERAL PROVISIONS RELATING TO STUDENT ASSISTANCE PROGRAMS SEC.

481. ø20 U.S.C.

1088¿ DEFINITIONS.


(a) ACADEMIC AND AWARD YEAR.—(1) For the purpose of any program under this title, the term ‘‘award year’’ shall be defined as the period beginning July 1 and ending June 30 of the following year.
(2)(A) For the purpose of any program under this title, the term ‘‘academic year’’ shall— (i) require a minimum of 30 weeks of instructional time for a course of study that measures its program length in credit hours; or (ii) require a minimum of 26 weeks of instructional time for a course of study that measures its program length in clock hours; and (iii) require an undergraduate course of study to contain an amount of instructional time whereby a full-time student is expected to complete at least— September 8, 2023 As Amended Through P.L.
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481 HIGHER EDUCATION ACT OF 1965 602 (I) 24 semester or trimester hours or 36 quarter credit hours in a course of study that measures its program length in credit hours; or (II) 900 clock hours in a course of study that measures its program length in clock hours.
(B) The Secretary may reduce such minimum of 30 weeks to not less than 26 weeks for good cause, as determined by the Sec- retary on a case-by-case basis, in the case of an institution of high- er education that provides a 2-year or 4-year program of instruc- tion for which the institution awards an associate or baccalaureate degree and that measures program length in credit hours or clock hours.
(b) ELIGIBLE PROGRAM.—(1) For purposes of this title, the term ‘‘eligible program’’ means a program of at least— (A) 600 clock hours of instruction, 16 semester hours, or 24 quarter hours, offered during a minimum of 15 weeks, in the case of a program that— (i) provides a program of training to prepare students for gainful employment in a recognized profession; and (ii) admits students who have not completed the equiv- alent of an associate degree; or (B) 300 clock hours of instruction, 8 semester hours, or 12 hours, offered during a minimum of 10 weeks, in the case of— (i) an undergraduate program that requires the equiv- alent of an associate degree for admissions; or (ii) a graduate or professional program.
(2)(A) A program is an eligible program for purposes of part B of this title if it is a program of at least 300 clock hours of instruc- tion, but less than 600 clock hours of instruction, offered during a minimum of 10 weeks, that— (i) has a verified completion rate of at least 70 percent, as determined in accordance with the regulations of the Sec- retary; (ii) has a verified placement rate of at least 70 percent, as determined in accordance with the regulations of the Sec- retary; and (iii) satisfies such further criteria as the Secretary may prescribe by regulation.
(B) In the case of a program being determined eligible for the first time under this paragraph, such determination shall be made by the Secretary before such program is considered to have satis- fied the requirements of this paragraph.
(3) An otherwise eligible program that is offered in whole or in part through telecommunications is eligible for the purposes of this title if the program is offered by an institution, other than a foreign institution, that has been evaluated and determined (before or after the date of enactment of the Higher Education Reconciliation Act of 2005) to have the capability to effectively deliver distance education programs by an accrediting agency or association that— (A) is recognized by the Secretary under subpart 2 of part H; and (B) has evaluation of distance education programs within the scope of its recognition, as described in section 496(n)(3).
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481 (4) For purposes of this title, the term ‘‘eligible program’’ in- cludes an instructional program that, in lieu of credit hours or clock hours as the measure of student learning, utilizes direct as- sessment of student learning, or recognizes the direct assessment of student learning by others, if such assessment is consistent with the accreditation of the institution or program utilizing the results of the assessment.
In the case of a program being determined eligi- ble for the first time under this paragraph, such determination shall be made by the Secretary before such program is considered to be an eligible program.
(c) THIRD PARTY SERVICER.—For purposes of this title, the term ‘‘third party servicer’’ means any individual, any State, or any private, for-profit or nonprofit organization, which enters into a contract with— (1) any eligible institution of higher education to admin- ister, through either manual or automated processing, any as- pect of such institution’s student assistance programs under this title; or (2) any guaranty agency, or any eligible lender, to admin- ister, through either manual or automated processing, any as- pect of such guaranty agency’s or lender’s student loan pro- grams under part B of this title, including originating, guaran- teeing, monitoring, processing, servicing, or collecting loans.
(d) DEFINITIONS FOR MILITARY DEFERMENTS.—For purposes of parts B, D, and E of this title: (1) ACTIVE DUTY.—The term ‘‘active duty’’ has the meaning given such term in section 101(d)(1) of title 10, United States Code, except that such term does not include active duty for training or attendance at a service school.

(2) MILITARY OPERATION.—The term ‘‘military operation’’ means a contingency operation as such term is defined in sec- tion 101(a)(13) of title 10, United States Code.
(3) NATIONAL EMERGENCY.—The term ‘‘national emer- gency’’ means the national emergency by reason of certain ter- rorist attacks declared by the President on September 14, 2001, or subsequent national emergencies declared by the President by reason of terrorist attacks.
(4) SERVING ON ACTIVE DUTY.—The term ‘‘serving on active duty during a war or other military operation or national emergency’’ means service by an individual who is— (A) a Reserve of an Armed Force ordered to active duty under section 12301(a), 12301(g), 12302, 12304, or 12306 of title 10, United States Code, or any retired mem- ber of an Armed Force ordered to active duty under section 688 of such title, for service in connection with a war or other military operation or national emergency, regardless of the location at which such active duty service is per- formed; and (B) any other member of an Armed Force on active duty in connection with such emergency or subsequent ac- tions or conditions who has been assigned to a duty station at a location other than the location at which such member is normally assigned.
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481A HIGHER EDUCATION ACT OF 1965 604 (5) QUALIFYING NATIONAL GUARD DUTY.—The term ‘‘quali- fying National Guard duty during a war or other military oper- ation or national emergency’’ means service as a member of the National Guard on full-time National Guard duty (as defined in section 101(d)(5) of title 10, United States Code) under a call to active service authorized by the President or the Secretary of Defense for a period of more than 30 consecutive days under section 502(f) of title 32, United States Code, in connection with a war, other military operation, or a national emergency declared by the President and supported by Federal funds.
(e) CONSUMER REPORTING AGENCY.—For purposes of this title, the term ‘‘consumer reporting agency’’ has the meaning given the term ‘‘consumer reporting agency that compiles and maintains files on consumers on a nationwide basis’’ in Section 603(p) of the Fair Credit Reporting Act (15 U.S.C.

1681a(p)).
1681a(p)).

(f) DEFINITION OF EDUCATIONAL SERVICE AGENCY.—For pur- poses of parts B, D, and E, the term ‘‘educational service agency’’ has the meaning given the term in section 8101 of the Elementary and Secondary Education Act of 1965.

SEC.

481A.

ø20 U.S.C.

1088a¿ CLOCK AND CREDIT HOUR TREATMENT OF DIPLOMA NURSING SCHOOLS.
Notwithstanding any other provision of this Act, any regula- tions promulgated by the Secretary concerning the relationship be- tween clock hours and semester, trimester, or quarter hours in cal- culating student grant, loan, or work assistance under this title, shall not apply to a public or private nonprofit hospital-based school of nursing that awards a diploma at the completion of the school’s program of education.

SEC.

482. ø20 U.S.C.

1089¿ MASTER CALENDAR.
(a) SECRETARY REQUIRED TO COMPLY WITH SCHEDULE.—To as- sure adequate notification and timely delivery of student aid funds under this title, the Secretary shall adhere to the following cal- endar dates in the year preceding the award year: (1) Development and distribution of Federal and multiple data entry forms— (A) by February 1: first meeting of the technical com- mittee on forms design of the Department; (B) by March 1: proposed modifications, updates, and notices pursuant to sections 478 and 483(a)(5) published in the Federal Register; (C) by June 1: final modifications, updates, and notices pursuant to sections 478 and 483(a)(5) published in the Federal Register; (D) by August 15: application for Federal student as- sistance and multiple data entry data elements and in- structions approved; (E) by August 30: final approved forms delivered to servicers and printers; (F) by October 1: Federal and multiple data entry forms and instructions printed; and (G) by November 1: Federal and multiple data entry forms, instructions, and training materials distributed.
(2) Allocations of campus-based and Pell Grant funds— September 8, 2023 As Amended Through P.L.

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482 (A) by August 1: distribution of institutional applica- tion for campus-based funds (FISAP) to institutions; (B) by October 1: final date for submission of FISAP by institutions to the Department; (C) by November 15: edited FISAP and computer printout received by institutions; (D) by December 1: appeals procedures received by in- (E) by December 15: edits returned by institutions to stitutions; the Department; (F) by February 1: tentative award levels received by institutions and final Pell Grant payment schedule; (G) by February 15: closing date for receipt of institu- tional appeals by the Department; (H) by March 1: appeals process completed; (I) by April 1: final award notifications sent to institu- tions; and (J) by June 1: Pell Grant authorization levels sent to institutions.
(3) The Secretary shall, to the extent practicable, notify eli- gible institutions, guaranty agencies, lenders, interested soft- ware providers, and, upon request, other interested parties, by December 1 prior to the start of an award year of minimal hardware and software requirements necessary to administer programs under this title.
(4) The Secretary shall attempt to conduct training activi- ties for financial aid administrators and others in an expedi- tious and timely manner prior to the start of an award year in order to ensure that all participants are informed of all ad- ministrative requirements.
(b) TIMING FOR REALLOCATIONS.—With respect to any funds re- allocated under section 413D(d), 442(d), or 462(i), the Secretary shall reallocate such funds at any time during the course of the year that will best meet the purpose of the programs under subpart 3 of part A, part C, and part E, respectively.

However, such re- allocation shall occur at least once each year, not later than Sep- tember 30 of that year.
(c) DELAY OF EFFECTIVE DATE OF LATE PUBLICATIONS.—(1) Ex- cept as provided in paragraph (2), any regulatory changes initiated by the Secretary affecting the programs under this title that have not been published in final form by November 1 prior to the start of the award year shall not become effective until the beginning of the second award year after such November 1 date.
(2)(A) The Secretary may designate any regulatory provision that affects the programs under this title and is published in final form after November 1 as one that an entity subject to the provi- sion may, in the entity’s discretion, choose to implement prior to the effective date described in paragraph (1).

The Secretary may specify in the designation when, and under what conditions, an en- tity may implement the provision prior to that effective date.
The Secretary shall publish any designation under this subparagraph in the Federal Register.

(B) If an entity chooses to implement a regulatory provision prior to the effective date described in paragraph (1), as permitted September 8, 2023 As Amended Through P.L.

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483 HIGHER EDUCATION ACT OF 1965 606 by subparagraph (A), the provision shall be effective with respect to that entity in accordance with the terms of the Secretary’s des- ignation.

(d) NOTICE TO CONGRESS.—The Secretary shall notify the au- thorizing committees when a deadline included in the calendar de- scribed in subsection (a) is not met.
Nothing in this section shall be interpreted to penalize institutions or deny them the specified times allotted to enable them to return information to the Sec- retary based on the failure of the Secretary to adhere to the dates specified in this section.

(e) COMPLIANCE CALENDAR.—Prior to the beginning of each award year, the Secretary shall provide to institutions of higher education a list of all the reports and disclosures required under this Act.
The list shall include— (1) the date each report or disclosure is required to be com- pleted and to be submitted, made available, or disseminated; (2) the required recipients of each report or disclosure; (3) any required method for transmittal or dissemination of each report or disclosure; (4) a description of the content of each report or disclosure sufficient to allow the institution to identify the appropriate in- dividuals to be assigned the responsibility for such report or disclosure; (5) references to the statutory authority, applicable regula- tions, and current guidance issued by the Secretary regarding each report or disclosure; and (6) any other information which is pertinent to the content or distribution of the report or disclosure.
SEC.

483.

56 ø20 U.S.C.

1090¿ FORMS AND REGULATIONS.
(a) COMMON FINANCIAL AID FORM DEVELOPMENT AND PROC- ESSING.— (1) IN GENERAL.—The Secretary, in cooperation with rep- resentatives of agencies and organizations involved in student financial assistance, shall produce, distribute, and process free of charge common financial reporting forms as described in this subsection to be used for application and reapplication to determine the need and eligibility of a student for financial as- sistance under parts A through E (other than subpart 4 of part A).
The forms shall be made available to applicants in both paper and electronic formats and shall be referred to as the ‘‘Free Application for Federal Student Aid’’ or the ‘‘FAFSA’’.

The Secretary shall work to make the FAFSA consumer-friend- ly and to make questions on the FAFSA easy for students and families to read and understand, and shall ensure that the FAFSA is available in formats accessible to individuals with disabilities.
(2) PAPER FORMAT.— (A) IN GENERAL.—The Secretary shall develop, make available, and process— (i) a paper version of EZ FAFSA, as described in subparagraph (B); and 56 For version of law of section 483, as amended by section 702(m)(1) of division FF of Public Law 116–260 (as in effect beginning on July 1, 2024), see note at the end of this version.

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483 (ii) a paper version of the other forms described in this subsection, in accordance with subparagraph (C), for any applicant who does not meet the requirements of or does not wish to use the process described in sub- paragraph (B).

(B) EZ FAFSA.— (i) IN GENERAL.—The Secretary shall develop and use, after appropriate field testing, a simplified paper form, to be known as the EZ FAFSA, to be used for applicants meeting the requirements of subsection (b) or (c) of section 479.
(ii) REDUCED DATA REQUIREMENTS.—The EZ FAFSA shall permit an applicant to submit, for finan- cial assistance purposes, only the data elements re- quired to make a determination of whether the appli- cant meets the requirements under subsection (b) or (c) of section 479.
(iii) STATE DATA.—The Secretary shall include on the EZ FAFSA such data items as may be necessary to award State financial assistance, as provided under paragraph (5), except that the Secretary shall not in- clude a State’s data if that State does not permit the State’s resident applicants to use the EZ FAFSA for State assistance.
(iv) FREE AVAILABILITY AND PROCESSING.—The provisions of paragraph (6) shall apply to the EZ FAFSA, and the data collected by means of the EZ FAFSA shall be available to institutions of higher edu- cation, guaranty agencies, and States in accordance with paragraph (10).

(C) PROMOTING THE USE OF ELECTRONIC FAFSA.— (i) IN GENERAL.—The Secretary shall make all ef- forts to encourage all applicants to utilize the elec- tronic version of the forms described in paragraph (3).
(ii) MAINTENANCE OF THE FAFSA IN A PRINTABLE ELECTRONIC FILE.—The Secretary shall maintain a version of the paper forms described in subparagraphs (A) and (B) in a printable electronic file that is easily portable, accessible, and downloadable to students on the same website used to provide students with the electronic version of the forms described in paragraph (3).

(iii) REQUESTS FOR PRINTED COPY.—The Secretary shall provide a printed copy of the full paper version of FAFSA upon request.
(iv) REPORTING REQUIREMENT.—The Secretary shall maintain data, and periodically report to Con- gress, on the impact of the digital divide on students completing applications for aid under this title.

The Secretary shall report on the steps taken to eliminate the digital divide and reduce production of the paper form described in subparagraph (A).
The Secretary’s report shall specifically address the impact of the dig- ital divide on the following student populations: September 8, 2023 As Amended Through P.L.

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483 HIGHER EDUCATION ACT OF 1965 608 (I) Independent students.

(II) Traditionally underrepresented students.

(III) Dependent students.


(3) ELECTRONIC FORMAT.— (A) IN GENERAL.—The Secretary shall produce, dis- tribute, and process forms in electronic format to meet the requirements of paragraph (1).

The Secretary shall develop an electronic version of the forms for applicants who do not meet the requirements of subsection (b) or (c) of section 479.
(B) SIMPLIFIED APPLICATIONS: FAFSA ON THE WEB.— (i) IN GENERAL.—The Secretary shall develop and use a simplified electronic version of the form to be used by applicants meeting the requirements under subsection (b) or (c) of section 479.
(ii) REDUCED DATA REQUIREMENTS.—The sim- plified electronic version of the forms shall permit an applicant to submit, for financial assistance purposes, only the data elements required to make a determina- tion of whether the applicant meets the requirements under subsection (b) or (c) of section 479.
(iii) USE OF FORMS.—Nothing in this subsection shall be construed to prohibit the use of the forms de- veloped by the Secretary pursuant to this paragraph by an eligible institution, eligible lender, guaranty agency, State grant agency, private computer software provider, a consortium thereof, or such other entities as the Secretary may designate.
(C) STATE DATA.—The Secretary shall include on the electronic version of the forms such items as may be nec- essary to determine eligibility for State financial assist- ance, as provided under paragraph (5), except that the Sec- retary shall not require an applicant to enter data pursu- ant to this subparagraph that are required by any State other than the applicant’s State of residence.
(D) AVAILABILITY AND PROCESSING.—The data collected by means of the simplified electronic version of the forms shall be available to institutions of higher education, guar- anty agencies, and States in accordance with paragraph (10).
(E) PRIVACY.—The Secretary shall ensure that data collection under this paragraph complies with section 552a of title 5, United States Code, and that any entity using the electronic version of the forms developed by the Sec- retary pursuant to this paragraph shall maintain reason- able and appropriate administrative, technical, and phys- ical safeguards to ensure the integrity and confidentiality of the information, and to protect against security threats, or unauthorized uses or disclosures of the information pro- vided on the electronic version of the forms.
Data collected by such electronic version of the forms shall be used only for the application, award, and administration of aid awarded under this title, State aid, or aid awarded by eli- gible institutions or such entities as the Secretary may September 8, 2023 As Amended Through P.L.
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483 designate.
483 designate.

No data collected by such electronic version of the forms shall be used for making final aid awards under this title until such data have been processed by the Sec- retary or a contractor or designee of the Secretary, except as may be permitted under this title.
(F) SIGNATURE.—Notwithstanding any other provision of this Act, the Secretary may continue to permit an elec- tronic version of the form under this paragraph to be sub- mitted without a signature, if a signature is subsequently submitted by the applicant or if the applicant uses a per- sonal identification number provided by the Secretary under subparagraph (G).
(G) PERSONAL IDENTIFICATION NUMBERS AUTHOR- IZED.—The Secretary may continue to assign to an appli- cant a personal identification number— (i) to enable the applicant to use such number as a signature for purposes of completing an electronic version of a form developed under this paragraph; and (ii) for any purpose determined by the Secretary to enable the Secretary to carry out this title.
(H) PERSONAL IDENTIFICATION NUMBER IMPROVE- MENT.—The Secretary shall continue to work with the Commissioner of Social Security to minimize the time re- quired for an applicant to obtain a personal identification number when applying for aid under this title through an electronic version of a form developed under this para- graph.
(4) STREAMLINING.— (A) STREAMLINED REAPPLICATION PROCESS.— (i) IN GENERAL.—The Secretary shall continue to streamline reapplication forms and processes for an applicant who applies for financial assistance under this title in the next succeeding academic year subse- quent to an academic year for which such applicant applied for financial assistance under this title.
(ii) UPDATING OF DATA ELEMENTS.—The Secretary shall determine, in cooperation with States, institu- tions of higher education, agencies, and organizations involved in student financial assistance, the data ele- ments that may be transferred from the previous aca- demic year’s application and those data elements that shall be updated.
(iii) REDUCED DATA AUTHORIZED.—Nothing in this title shall be construed as limiting the authority of the Secretary to reduce the number of data elements re- quired of reapplicants.

(iv) ZERO FAMILY CONTRIBUTION.—Applicants de- termined to have a zero family contribution pursuant to section 479(c) shall not be required to provide any financial data in a reapplication form, except data that are necessary to determine eligibility under such sec- tion.
(B) REDUCTION OF DATA ELEMENTS.— September 8, 2023 As Amended Through P.L.

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483 HIGHER EDUCATION ACT OF 1965 610 (i) REDUCTION ENCOURAGED.—Of the number of data elements on the FAFSA used for the 2009–2010 award year, the Secretary, in cooperation with rep- resentatives of agencies and organizations involved in student financial assistance and consistent with ef- forts under subsection (c), shall continue to reduce the number of such data elements required to be entered by all applicants, with the goal of reducing such num- ber by 50 percent.
(ii) REPORT.—The Secretary shall submit a report on the process of this reduction to each of the author- izing committees by June 30, 2011.

(5) STATE REQUIREMENTS.— (A) IN GENERAL.—Except as provided in paragraphs (2)(B)(iii), (3)(B), and (4)(A)(ii), the Secretary shall include on the forms developed under this subsection, such State- specific data items as the Secretary determines are nec- essary to meet State requirements for need-based State aid.
Such items shall be selected in consultation with State agencies in order to assist in the awarding of State finan- cial assistance in accordance with the terms of this sub- section.

The number of such data items shall not be less than the number included on the form for the 2008–2009 award year unless a State notifies the Secretary that the State no longer requires those data items for the distribu- tion of State need-based aid.
(B) ANNUAL REVIEW.—The Secretary shall conduct an annual review to determine— (i) which data items each State requires to award need-based State aid; and (ii) if the State will permit an applicant to file a form described in paragraph (2)(B) or (3)(B).
(C) FEDERAL REGISTER NOTICE.—Beginning with the forms developed under paragraphs (2)(B) and (3)(B) for the award year 2010–2011, the Secretary shall publish on an annual basis a notice in the Federal Register requiring State agencies to inform the Secretary— (i) if the State agency is unable to permit appli- cants to utilize the simplified forms described in para- graphs (2)(B) and (3)(B); and (ii) of the State-specific nonfinancial data that the State agency requires for delivery of State need-based financial aid.
(D) USE OF SIMPLIFIED FORMS ENCOURAGED.—The Sec- retary shall encourage States to take such steps as are necessary to encourage the use of simplified forms under this subsection, including those forms described in para- graphs (2)(B) and (3)(B), for applicants who meet the re- quirements of subsection (b) or (c) of section 479.
(E) CONSEQUENCES IF STATE DOES NOT ACCEPT SIM- PLIFIED FORMS.—If a State does not permit an applicant to file a form described in paragraph (2)(B) or (3)(B) for pur- poses of determining eligibility for State need-based finan- cial aid, the Secretary may determine that State-specific September 8, 2023 As Amended Through P.L.
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483 questions for such State will not be included on a form de- scribed in paragraph (2)(B) or (3)(B).

If the Secretary makes such determination, the Secretary shall advise the State of the Secretary’s determination.
(F) LACK OF STATE RESPONSE TO REQUEST FOR INFOR- MATION.—If a State does not respond to the Secretary’s re- quest for information under subparagraph (B), the Sec- retary shall— (i) permit residents of that State to complete sim- plified forms under paragraphs (2)(B) and (3)(B); and (ii) not require any resident of such State to com- plete any data items previously required by that State under this section.
(G) RESTRICTION.—The Secretary shall, to the extent practicable, not require applicants to complete any finan- cial or nonfinancial data items that are not required— (i) by the applicant’s State; or (ii) by the Secretary.

(6) CHARGES TO STUDENTS AND PARENTS FOR USE OF FORMS PROHIBITED.—The need and eligibility of a student for financial assistance under parts A through E (other than under subpart 4 of part A) may be determined only by using a form developed by the Secretary under this subsection.
Such forms shall be produced, distributed, and processed by the Secretary, and no parent or student shall be charged a fee by the Secretary, a contractor, a third-party servicer or private software provider, or any other public or private entity for the collection, proc- essing, or delivery of financial aid through the use of such forms.
No data collected on a form for which a fee is charged shall be used to complete the form prescribed under this sec- tion, except that a Federal or State income tax form prepared by a paid income tax preparer or preparer service for the pri- mary purpose of filing a Federal or State income tax return may be used to complete the form prescribed under this sec- tion.
(7) RESTRICTIONS ON USE OF PIN.—No person, commercial entity, or other entity may request, obtain, or utilize an appli- cant’s personal identification number assigned under para- graph (3)(G) for purposes of submitting a form developed under this subsection on an applicant’s behalf.
(8) APPLICATION PROCESSING CYCLE.—The Secretary shall enable students to submit forms developed under this sub- section and initiate the processing of such forms under this subsection, as early as practicable prior to January 1 of the student’s planned year of enrollment.
(9) EARLY ESTIMATES.—The Secretary shall continue to— (A) permit applicants to enter data in such forms as described in this subsection in the years prior to enroll- ment in order to obtain a non-binding estimate of the ap- plicant’s family contribution (as defined in section 473); (B) permit applicants to update information submitted on forms described in this subsection, without needing to re-enter previously submitted information; September 8, 2023 As Amended Through P.L.
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483 HIGHER EDUCATION ACT OF 1965 612 (C) develop a means to inform applicants, in the years prior to enrollment, of student aid options for individuals in similar financial situations; (D) develop a means to provide a clear and con- spicuous notice that the applicant’s expected family con- tribution is subject to change and may not reflect the final expected family contribution used to determine Federal student financial aid award amounts under this title; and (E) consult with representatives of States, institutions of higher education, and other individuals with experience or expertise in student financial assistance application processes in making updates to forms used to provide early estimates under this paragraph.
(10) DISTRIBUTION OF DATA.—Institutions of higher edu- cation, guaranty agencies, and States shall receive, without charge, the data collected by the Secretary using a form devel- oped under this subsection for the purposes of processing loan applications and determining need and eligibility for institu- tional and State financial aid awards.
Entities designated by institutions of higher education, guaranty agencies, or States to receive such data shall be subject to all the requirements of this section, unless such requirements are waived by the Sec- retary.
(11) THIRD PARTY SERVICERS AND PRIVATE SOFTWARE PRO- VIDERS.—To the extent practicable and in a timely manner, the Secretary shall provide, to private organizations and consortia that develop software used by institutions of higher education for the administration of funds under this title, all the nec- essary specifications that the organizations and consortia must meet for the software the organizations and consortia develop, produce, and distribute (including any diskette, modem, or net- work communications) to be so used.
The specifications shall contain record layouts for required data.

The Secretary shall develop in advance of each processing cycle an annual schedule for providing such specifications.

The Secretary, to the extent practicable, shall use multiple means of providing such speci- fications, including conferences and other meetings, outreach, and technical support mechanisms (such as training and print- ed reference materials).
The Secretary shall, from time to time, solicit from such organizations and consortia means of improv- ing the support provided by the Secretary.

(12) PARENT’S SOCIAL SECURITY NUMBER AND BIRTH DATE.— The Secretary is authorized to include space on the forms de- veloped under this subsection for the social security number and birth date of parents of dependent students seeking finan- cial assistance under this title.
(b) INFORMATION TO COMMITTEES OF CONGRESS.—Copies of all rules, regulations, guidelines, instructions, and application forms published or promulgated pursuant to this title shall be provided to the authorizing committees at least 45 days prior to their effec- tive date.

(c) TOLL-FREE INFORMATION.—The Secretary shall contract for, or establish, and publicize a toll-free telephone service to provide timely and accurate information to the general public.

The informa- September 8, 2023 As Amended Through P.L.
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483 tion provided shall include specific instructions on completing the application form for assistance under this title.
Such service shall also include a service accessible by telecommunications devices for the deaf (TDD’s) and shall, in addition to the services provided for in the previous sentence, refer such students to the national clear- inghouse on postsecondary education or other appropriate provider of technical assistance and information on postsecondary edu- cational services for individuals with disabilities, including the Na- tional Technical Assistance Center under section 777.
The Sec- retary shall continue to implement, to the extent practicable, a toll- free telephone based system to permit applicants who meet the re- quirements of subsection (b) or (c) of section 479 to submit an ap- plication over such system.
(d) ASSISTANCE IN PREPARATION OF FINANCIAL AID APPLICA- TION.— (1) PREPARATION AUTHORIZED.—Notwithstanding any pro- vision of this Act, an applicant may use a preparer for consult- ative or preparation services for the completion of a form devel- oped under subsection (a) if the preparer satisfies the require- ments of this subsection.
(2) PREPARER IDENTIFICATION REQUIRED.—If an applicant uses a preparer for consultative or preparation services for the completion of a form developed under subsection (a), and for which a fee is charged, the preparer shall— (A) include, at the time the form is submitted to the Department, the name, address or employer’s address, so- cial security number or employer identification number, and organizational affiliation of the preparer on the appli- cant’s form; and (B) be subject to the same penalties as an applicant for purposely giving false or misleading information in the application.
(3) ADDITIONAL REQUIREMENTS.—A preparer that provides consultative or preparation services pursuant to this subsection shall— (A) clearly inform each individual upon initial contact, including contact through the Internet or by telephone, that the FAFSA and EZ FAFSA are free forms that may be completed without professional assistance via paper or electronic version of the forms that are provided by the Secretary; (B) include in any advertising clear and conspicuous information that the FAFSA and EZ FAFSA are free forms that may be completed without professional assistance via paper or electronic version of the forms that are provided by the Secretary; (C) if advertising or providing any information on a website, or if providing services through a website, include on the website a link to the website that provides the elec- tronic version of the forms developed under subsection (a); and (D) not produce, use, or disseminate any other form for the purpose of applying for Federal student financial aid September 8, 2023 As Amended Through P.L.
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483 HIGHER EDUCATION ACT OF 1965 614 TION PROGRAM.— other than the form developed by the Secretary under sub- section (a).
(4) SPECIAL RULE.—Nothing in this Act shall be construed to limit preparers of the forms required under this title that meet the requirements of this subsection from collecting source information from a student or parent, including Internal Rev- enue Service tax forms, in providing consultative and prepara- tion services in completing the forms.
(e) EARLY APPLICATION AND ESTIMATED AWARD DEMONSTRA- (1) PURPOSE AND OBJECTIVES.—The purpose of the dem- onstration program under this subsection is to measure the benefits, in terms of student aspirations and plans to attend an institution of higher education, and any adverse effects, in terms of program costs, integrity, distribution, and delivery of aid under this title, of implementing an early application sys- tem for all dependent students that allows dependent students to apply for financial aid using information from two years prior to the year of enrollment.
Additional objectives associated with implementation of the demonstration program are the fol- lowing: (A) To measure the feasibility of enabling dependent students to apply for Federal, State, and institutional fi- nancial aid in their junior year of secondary school, using information from two years prior to the year of enrollment, by completing any of the forms under this subsection.
(B) To identify whether receiving final financial aid award estimates not later than the fall of the senior year of secondary school provides students with additional time to compete for the limited resources available for State and institutional financial aid and positively impacts the col- lege aspirations and plans of these students.
(C) To measure the impact of using income informa- tion from the years prior to enrollment on— (i) eligibility for financial aid under this title and for other State and institutional aid; and (ii) the cost of financial aid programs under this title.

(D) To effectively evaluate the benefits and adverse ef- fects of the demonstration program on program costs, in- tegrity, distribution, and delivery of financial aid.
(2) PROGRAM AUTHORIZED.—Not later than two years after the date of enactment of the Higher Education Opportunity Act, the Secretary shall implement an early application dem- onstration program enabling dependent students who wish to participate in the program— (A) to complete an application under this subsection during the academic year that is two years prior to the year such students plan to enroll in an institution of high- er education; and (B) based on the application described in subpara- graph (A), to obtain, not later than one year prior to the year of the students’ planned enrollment, information on eligibility for Federal Pell Grants, Federal student loans September 8, 2023 As Amended Through P.L.
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483 under this title, and State and institutional financial aid for the student’s first year of enrollment in the institution of higher education.
(3) EARLY APPLICATION AND ESTIMATED AWARD.—For all de- pendent students selected for participation in the demonstra- tion program who submit a completed FAFSA, or, as appro- priate, an EZ FAFSA, two years prior to the year such stu- dents plan to enroll in an institution of higher education, the Secretary shall, not later than one year prior to the year of such planned enrollment— (A) provide each student who completes an early appli- cation with an estimated determination of such student’s— (i) expected family contribution for the first year of the student’s enrollment in an institution of higher education; and (ii) Federal Pell Grant award for the first such year, based on the Federal Pell Grant amount, deter- mined under section 401(b)(2)(A), for which a student is eligible at the time of application; and (B) remind the students of the need to update the stu- dents’ information during the calendar year of enrollment using the expedited reapplication process provided for in subsection (a)(4)(A).
(4) PARTICIPANTS.—The Secretary shall include as partici- pants in the demonstration program— (A) States selected through the application process de- scribed in paragraph (5); (B) institutions of higher education within the selected States that are interested in participating in the dem- onstration program, and that can make estimates or com- mitments of institutional student financial aid, as appro- priate, to students the year before the students’ planned enrollment date; and (C) secondary schools within the selected States that are interested in participating in the demonstration pro- gram, and that can commit resources to— (i) advertising the availability of the program; (ii) identifying students who might be interested in participating in the program; (iii) encouraging such students to apply; and (iv) participating in the evaluation of the program.
(5) APPLICATIONS.—Each State that is interested in partici- pating in the demonstration program shall submit an applica- tion to the Secretary at such time, in such form, and con- taining such information as the Secretary shall require.
The application shall include— (A) information on the amount of the State’s need- based student financial assistance available, and the eligi- bility criteria for receiving such assistance; (B) a commitment to make, not later than the year be- fore the dependent students participating in the dem- onstration program plan to enroll in an institution of high- er education, an estimate of the award of State financial aid to such dependent students; September 8, 2023 As Amended Through P.L.
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483 HIGHER EDUCATION ACT OF 1965 616 (C) a plan for recruiting institutions of higher edu- cation and secondary schools with different demographic characteristics to participate in the program; (D) a plan for selecting institutions of higher education and secondary schools to participate in the program that— (i) demonstrate a commitment to encouraging stu- dents to submit a FAFSA, or, as appropriate, an EZ FAFSA, two years before the students’ planned date of enrollment in an institution of higher education; (ii) serve different populations of students; (iii) in the case of institutions of higher edu- cation— (I) to the extent possible, are of varying types and sectors; and (II) commit to making, not later than the year prior to the year that dependent students partici- pating in the demonstration program plan to en- roll in the institution— (aa) estimated institutional awards to participating dependent students; and (bb) estimated grants or other financial aid available under this title (including sup- plemental grants under subpart 3 of part A), for all participating dependent students, along with information on State awards, as provided to the institution by the State; (E) a commitment to participate in the evaluation con- ducted by the Secretary; and (F) such other information as the Secretary may re- quire.
(6) SPECIAL PROVISIONS.— (A) DISCRETION OF STUDENT FINANCIAL AID ADMINIS- TRATORS.—A financial aid administrator at an institution of higher education participating in a demonstration pro- gram under this subsection may use the discretion pro- vided under section 479A as necessary for students partici- pating in the demonstration program.
(B) WAIVERS.—The Secretary is authorized to waive, for an institution of higher education participating in the demonstration program, any requirements under this title, or regulations prescribed under this title, that will make the demonstration program unworkable, except that the Secretary shall not waive any provisions with respect to the maximum award amounts for grants and loans under this title.
(7) OUTREACH.—The Secretary shall make appropriate ef- forts to notify States of the demonstration program under this subsection.

Upon determination of participating States, the Secretary shall continue to make efforts to notify institutions of higher education and dependent students within partici- pating States of the opportunity to participate in the dem- onstration program and of the participation requirements.
(8) EVALUATION.—The Secretary shall conduct a rigorous evaluation of the demonstration program to measure the pro- September 8, 2023 As Amended Through P.L.

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483 gram’s benefits and adverse effects, as the benefits and effects relate to the purpose and objectives of the program described in paragraph (1).
In conducting the evaluation, the Secretary shall— (A) determine whether receiving financial aid esti- mates one year prior to the year in which the student plans to enroll in an institution of higher education, has a positive impact on the higher education aspirations and plans of such student; (B) measure the extent to which using a student’s in- come information from the year that is two years prior to the student’s planned enrollment date had an impact on the ability of States and institutions of higher education to make financial aid awards and commitments; (C) determine what operational changes are required to implement the program on a larger scale; (D) identify any changes to Federal law that are nec- essary to implement the program on a permanent basis; (E) identify the benefits and adverse effects of pro- viding early estimates on program costs, program oper- ations, program integrity, award amounts, distribution, and delivery of aid; and (F) examine the extent to which estimated awards dif- fer from actual awards made to students participating in the program.
(9) CONSULTATION.—The Secretary shall consult, as appro- priate, with the Advisory Committee on Student Financial As- sistance established under section 491 on the design, imple- mentation, and evaluation of the demonstration program.
(f) REDUCTION OF INCOME AND ASSET INFORMATION TO DETER- MINE ELIGIBILITY FOR STUDENT FINANCIAL AID.— (1) CONTINUATION OF CURRENT FAFSA SIMPLIFICATION EF- FORTS.—The Secretary shall continue to examine— (A) how the Internal Revenue Service can provide to the Secretary income and other data needed to compute an expected family contribution for taxpayers and dependents of taxpayers, and when in the application cycle the data can be made available; (B) whether data provided by the Internal Revenue Service can be used to— (i) prepopulate the electronic version of the FAFSA with student and parent taxpayer data; or (ii) generate an expected family contribution with- out additional action on the part of the student and taxpayer; and (C) whether the data elements collected on the FAFSA that are needed to determine eligibility for student aid, or to administer the Federal student financial aid programs under this title, but are not needed to compute an expected family contribution, such as information regarding the stu- dent’s citizenship or permanent residency status, registra- tion for selective service, or driver’s license number, can be reduced without adverse effects.
September 8, 2023 As Amended Through P.L.

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483 HIGHER EDUCATION ACT OF 1965 618 (2) REPORT ON FAFSA SIMPLIFICATION EFFORTS TO DATE.— Not later than 90 days after the date of enactment of the High- er Education Opportunity Act, the Secretary shall provide a written report to the authorizing committees on the work the Department has done with the Secretary of the Treasury re- garding— (A) how the expected family contribution of a student can be calculated using substantially less income and asset information than was used on March 31, 2008; (B) the extent to which the reduced income and asset information will result in a redistribution of Federal grants and subsidized loans under this title, State aid, or institutional aid, or in a change in the composition of the group of recipients of such aid, and the amount of such re- distribution; (C) how the alternative approaches for calculating the expected family contribution will— (i) rely mainly, in the case of students and parents who file income tax returns, on information available on the 1040, 1040EZ, and 1040A; and (ii) include formulas for adjusting income or asset information to produce similar results to the existing approach with less data; (D) how the Internal Revenue Service can provide to the Secretary of Education income and other data needed to compute an expected family contribution for taxpayers and dependents of taxpayers, and when in the application cycle the data can be made available; (E) whether data provided by the Internal Revenue Service can be used to— (i) prepopulate the electronic version of the FAFSA with student and parent taxpayer data; or (ii) generate an expected family contribution with- out additional action on the part of the student and taxpayer; (F) the extent to which the use of income data from two years prior to a student’s planned enrollment date will change the expected family contribution computed in ac- cordance with part F, and potential adjustments to the need analysis formula that will minimize the change; and (G) the extent to which the data elements collected on the FAFSA on March 31, 2008, that are needed to deter- mine eligibility for student aid or to administer the Fed- eral student financial aid programs, but are not needed to compute an expected family contribution, such as informa- tion regarding the student’s citizenship or permanent resi- dency status, registration for selective service, or driver’s license number, can be reduced without adverse effects.
(3) STUDY.— (A) FORMATION OF STUDY GROUP.—Not later than 90 days after the date of enactment of the Higher Education Opportunity Act, the Comptroller General shall convene a study group the membership of which shall include the Secretary of Education, the Secretary of the Treasury, the September 8, 2023 As Amended Through P.L.
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483 Director of the Office of Management and Budget, the Di- rector of the Congressional Budget Office, representatives of institutions of higher education with expertise in Fed- eral and State financial aid assistance, State chief execu- tive officers of higher education with a demonstrated com- mitment to simplifying the FAFSA, and such other individ- uals as the Comptroller General and the Secretary of Edu- cation may designate.
(B) STUDY REQUIRED.—The Comptroller General, in consultation with the study group convened under sub- paragraph (A) shall— (i) review and build on the work of the Secretary of Education and the Secretary of the Treasury, and individuals with expertise in analysis of financial need, to assess alternative approaches for calculating the expected family contribution under the statutory need analysis formula in effect on the day before the date of enactment of the Higher Education Oppor- tunity Act and under a new calculation that will use substantially less income and asset information than was used for the 2008–2009 FAFSA; (ii) conduct an additional analysis if necessary; and (iii) make recommendations to the authorizing committees.
(C) OBJECTIVES OF STUDY.—The objectives of the study required under subparagraph (B) are— (i) to determine methods to shorten the FAFSA and make the FAFSA easier and less time-consuming to complete, thereby increasing higher education ac- cess for low-income students; (ii) to identify changes to the statutory need anal- ysis formula that will be necessary to reduce the amount of financial information students and families need to provide to receive a determination of eligibility for student financial aid without causing significant redistribution of Federal grants and subsidized loans under this title; and (iii) to review State and institutional needs and uses for data collected on the FAFSA, and to deter- mine the best means of addressing such needs in the case of modification of the FAFSA as described in clause (i), or modification of the need analysis formula as described in clause (ii).
(D) REQUIRED SUBJECTS OF STUDY.—The study re- quired under subparagraph (B) shall examine— (i) with respect to simplification of the financial aid application process using the statutory require- ments for need analysis— (I) additional steps that can be taken to sim- plify the financial aid application process for stu- dents who (or, in the case of dependent students, whose parents) are not required to file a Federal income tax return for the prior taxable year; September 8, 2023 As Amended Through P.L.
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483 HIGHER EDUCATION ACT OF 1965 620 (II) information on State use of information provided on the FAFSA, including— (aa) whether a State uses, as of the time of the study, or can use, a student’s expected family contribution based on data from two years prior to the student’s planned enroll- ment date; (bb) the extent to which States and insti- tutions will accept the data provided by the Internal Revenue Service to prepopulate the electronic version of the FAFSA to determine the distribution of State and institutional stu- dent financial aid funds; (cc) what data are used by States, as of the time of the study, to determine eligibility for State student financial aid, and whether the data are used for merit- or need-based aid; (dd) whether State data are required by State law, State regulations, or policy direc- tives; and (ee) the extent to which any State-specific information requirements can be met by com- pletion of a State application linked to the electronic version of the FAFSA; and (III) information on institutional needs, in- cluding the extent to which institutions of higher education are already using supplemental forms to collect additional data from students and their families to determine eligibility for institutional funds; and (ii) ways to reduce the amount of financial infor- mation students and families need to provide to re- ceive a determination of eligibility for student finan- cial aid, taking into account— (I) the amount of redistribution of Federal grants and subsidized loans under this title caused by such a reduction, and the benefits to be gained by having an application process that will be easier for students and their families; (II) students and families who do not file in- come tax returns; (III) the extent to which the full array of in- come and asset information collected on the FAFSA, as of the time of the study, plays an im- portant role in the awarding of need-based State financial aid, and whether the State can use an expected family contribution generated by the FAFSA, instead of income and asset information or a calculation with reduced data elements, to support determinations of eligibility for such State aid programs and, if not, what additional informa- tion will be needed or what changes to the FAFSA will be required; and September 8, 2023 As Amended Through P.L.
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483 (IV) information on institutional needs, in- cluding the extent to which institutions of higher education are already using supplemental forms to collect additional data from students and their families to determine eligibility for institutional funds; and (V) changes to this Act or other laws that will be required to implement a modified need analysis system.
(4) CONSULTATION.—The Secretary shall consult with the Advisory Committee on Student Financial Assistance estab- lished under section 491 as appropriate in carrying out this subsection.
(5) REPORTS.— (A) REPORTS ON STUDY.—The Secretary shall prepare and submit to the authorizing committees— (i) not later than one year after the date of enact- ment of the Higher Education Opportunity Act, an in- terim report on the progress of the study required under paragraph (3) that includes any preliminary recommendations by the study group established under such paragraph; and (ii) not later than two years after the date of en- actment of the Higher Education Opportunity Act, a final report on the results of the study required under paragraph (3) that includes recommendations by the study group established under such paragraph.
(B) REPORTS ON FAFSA SIMPLIFICATION EFFORTS.—The Secretary shall report to the authorizing committees, from time to time, on the progress of the simplification efforts under this subsection.
(g) ADDRESSING THE DIGITAL DIVIDE.—The Secretary shall uti- lize savings accrued by moving more applicants to the electronic version of the forms described in subsection (a)(3) to improve access to the electronic version of the forms described in such subsection for applicants meeting the requirements of subsection (b) or (c) of section 479.
(h) ADJUSTMENTS.—The Secretary shall disclose, on the form notifying a student of the student’s expected family contribution, that the student may, on a case-by-case basis, qualify for an adjust- ment under section 479A to the cost of attendance or the values of the data items required to calculate the expected contribution for the student or parent.
Such disclosure shall specify— (1) the special circumstances under which a student or family member may qualify for such adjustment; and (2) additional information regarding the steps a student or family member may take in order to seek an adjustment under section 479A.

øNote: Effective on July 1, 2024, subsection (m)(1) of section 702 of division FF of Public Law 116-260 provides for an amend- ment to strike section 483 and insert a new section 483.

Upon such September 8, 2023 As Amended Through P.L.
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483 HIGHER EDUCATION ACT OF 1965 622 date, section 483 (as amended including an amendment by section 102(b)(4) of division R of Public Law 117–103) will read as follows:¿ SEC.

483. ƒ20 U.S.C.

1090≈ FREE APPLICATION FOR FEDERAL STUDENT AID.


(a) SIMPLIFIED APPLICATION FOR FEDERAL STUDENT FINANCIAL AID.— (1) IN GENERAL.—Each individual seeking to apply for Fed- eral financial aid under this title for award year 2024–2025 and any subsequent award year shall file a free application with the Secretary, known as the ‘‘Free Application for Federal Student Aid’’, to determine eligibility for such aid, as described in paragraph (2), and in accordance with section 479.
(2) FREE APPLICATION.— (A) IN GENERAL.—The Secretary shall make available, for the purposes of paragraph (1), a free application to de- termine the eligibility of a student for Federal financial aid under this title.

(B) INFORMATION REQUIRED BY THE APPLICANT.— (i) IN GENERAL.—The applicant, and, if necessary, the parents or spouse of the applicant, shall provide the Secretary with the applicable information described in clause (ii) in order to be eligible for Federal financial aid under this title.
(ii) INFORMATION TO BE PROVIDED.—The informa- tion described in this clause is the following: (I) Name.

(II) Contact information, including address, phone number, email address, or other electronic address.

(III) Social security number.

(IV) Date of birth.

(V) Marital status.

(VI) Citizenship status, including alien reg- istration number, if applicable.

(VII) Sex.
(VII) Sex.

(VIII) Race or ethnicity, using categories devel- oped in consultation with the Bureau of the Census and the Director of the Institute of Education Sciences that, to the greatest extent practicable, separately capture the racial groups specified in the American Community Survey of the Bureau of the Census.

(IX) State of legal residence and date of resi- dency.
(X) The following information on secondary school completion: (aa) Name and location of the high school from which the applicant received, or will re- ceive prior to the period of enrollment for which aid is sought, a regular high school di- ploma; (bb) name and location of the entity from which the applicant received, or will receive prior to the period of enrollment for which aid September 8, 2023 As Amended Through P.L.
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483 is sought, a recognized equivalent of a regular high school diploma; or (cc) if the applicant completed or will com- plete prior to the period of enrollment for which aid is sought, a secondary school edu- cation in a home school setting that is treated as a home school or private school under State law.

(XI) Name of each institution where the appli- cant intends to apply for enrollment or continue enrollment.
(XII) Year in school for period of enrollment for which aid is sought, including whether appli- cant will have finished first bachelor’s degree prior to the period of enrollment for which aid is sought.

(XIII) Whether one or both of the applicant’s parents attended college.
(XIV) Any required asset information, unless exempt under section 479, in which the applicant shall indicate— (aa) the annual amount of child support received, if applicable; and (bb) all required asset information not de- scribed in item (aa).

(XV) The number of members of the appli- cant’s family who will also be enrolled in an eligi- ble institution of higher education on at least a half-time basis during the same enrollment period as the applicant.
(XVI) If the applicant meets any of the fol- lowing designations: (aa) Is an unaccompanied homeless youth, or is unaccompanied, at risk of homelessness, and self-supporting.

(bb) Is an emancipated minor.

(cc) Is in legal guardianship.

(dd) Has been a dependent ward of the court at any time since the applicant turned 13.

(ee) Has been in foster care at any time since the applicant turned 13.

(ff) Both parents have died since the ap- plicant turned 13.
(gg) Is a veteran of the Armed Forces of the United States or is serving (on the date of the application) on active duty in the Armed Forces for other than training purposes.

(hh) Is under the age of 24 and has a de- pendent child or relative.

(ii) Does not have access to parental infor- mation due to an unusual circumstance de- scribed in section 480(d)(9).

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483 HIGHER EDUCATION ACT OF 1965 624 (XVII) If the applicant receives or has received any of the following means-tested Federal benefits within the last two years: (aa) The supplemental security income program under title XVI of the Social Security Act (42 U.S.C.
1381 et seq.).

(bb) The supplemental nutrition assist- ance program under the Food and Nutrition Act of 2008 (7 U.S.C.

2011 et seq.

), a nutrition assistance program carried out under section 19 of such Act (7 U.S.C.

2028), or a supple- mental nutrition assistance program carried out under section 3(c) of the Act entitled ‘‘An Act to authorize appropriations for certain in- sular areas of the United States, and for other purposes’’ (Public Law 95–348).
(cc) The free and reduced price school lunch program established under the Richard B. Russell National School Lunch Act (42 U.S.C.

1751 et seq.).

(dd) The program of block grants for States for temporary assistance for needy fam- ilies established under part A of title IV of the Social Security Act (42 U.S.C.

601 et seq.).

(ee) The special supplemental nutrition program for women, infants, and children es- tablished by section 17 of the Child Nutrition Act of 1966 (42 U.S.C.

1786).
1786).

(ff) The Medicaid program under title XIX of the Social Security Act (42 U.S.C.

1396 et seq.).

(gg) Federal housing assistance programs, including tenant-based assistance under sec- tion 8(o) of the United States Housing Act of 1937 (42 U.S.C.

1437f(o)), and public housing, as defined in section 3(b)(1) of such Act (42 U.S.C.

1437a(b)(1)).

(hh) Refundable credit for coverage under a qualified health plan under section 36B of the Internal Revenue Code of 1986.
(ii) The Earned Income Tax Credit under section 32 of the Internal Revenue Code of 1986.

(jj) Any other means-tested program deter- mined by the Secretary to be appropriate.
(XVIII) If the applicant, or, if necessary, the parents or spouse of the applicant, reported receiv- ing tax exempt payments from an individual re- tirement plan (as defined in section 7701 of the In- ternal Revenue Code of 1986) distribution or from pensions or annuities on a Federal tax return, in- formation as to how much of the individual retire- ment plan distribution or pension or annuity dis- bursement was a qualified rollover.

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483 (XIX) If the applicant, or, if necessary, the par- ents or spouse of the applicant, reported receiving foreign income that is exempt from Federal tax- ation or for which a permanent resident of the United States or United States citizen receives a foreign tax credit, information regarding the amount of such foreign income.
(XX) If the applicant, or, if applicable, the par- ents or spouse of the applicant, elects to report re- ceiving college grant and scholarship aid included in gross income on a Federal tax return described in section 480(e)(2), information regarding the amount of such aid (iii) PROHIBITION AGAINST REQUESTING INFORMA- TION MORE THAN ONCE.—Any information requested during the process of creating an account for com- pleting the free application under this subsection, shall, to the fullest extent possible, not be required a second time for the same award year, or in a duplica- tive manner, when completing such free application ex- cept in the case of an unusual situation, such as a tem- porary inability to access an account for completing such free application.
(iv) CHANGE IN FAMILY SIZE.—The Secretary shall provide a process by which an applicant shall confirm the accuracy of family size or update the family size with respect to such applicant for purposes of deter- mining the need of such applicant for financial assist- ance under this title based on a change in family size from the tax year data used for such determination.
(v) SINGLE QUESTION FOR HOMELESS STATUS.—The Secretary shall ensure that— (I) on the form developed under this section for which the information is applicable, there is a sin- gle, easily understood screening question to iden- tify an applicant who is an unaccompanied home- less youth or is unaccompanied, at risk of home- lessness, and self-supporting; and (II) such question is distinct from those relat- ing to an individual who does not have access to parental income due to an unusual circumstance.
(vi) ADJUSTMENTS.—The Secretary shall disclose on the FAFSA that the student may, on a case-by-case basis, qualify for an adjustment under section 479A to the cost of attendance or the values of the data items required to calculate the student’s eligibility for a Fed- eral Pell Grant or the student aid index for the student or parent.
(C) NOTIFICATION AND APPROVAL OF REQUEST FOR TAX RETURN INFORMATION.—The Secretary shall notify students and borrowers who wish to submit an application for Fed- eral student financial aid under this title (as well as par- ents and spouses who must sign such an application or re- quest or a Master Promissory Note on behalf of those stu- September 8, 2023 As Amended Through P.L.
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483 HIGHER EDUCATION ACT OF 1965 626 dents and borrowers) of the authority of the Secretary to re- quire that such persons affirmatively approve that the In- ternal Revenue Service disclose their tax return information as described in section 494.
(D) AUTHORIZATIONS AVAILABLE TO THE APPLICANT.— (i) AUTHORIZATION TO DISCLOSE FAFSA INFORMA- TION, INCLUDING A REDISCLOSURE OF TAX RETURN IN- FORMATION, TO INSTITUTION, STATE HIGHER EDUCATION AGENCY, AND DESIGNATED SCHOLARSHIP ORGANIZA- TIONS.—An applicant and, if necessary, the parents or spouse of the applicant shall provide the Secretary with authorization to disclose to an institution, State higher education agency, and scholarship organizations (des- ignated (prior to the date of enactment of the FUTURE Act (Public Law 116–91)) by the Secretary under sec- tion 483(a)(3)(E)) as in effect on such date of enact- ment, as specified by the applicant and in accordance with section 494, in order for the applicant’s eligibility for Federal financial aid programs, State financial aid programs, institutional financial aid programs, and scholarship programs at scholarship organizations (designated (prior to the date of enactment of the FU- TURE Act (Public Law 116–91)) by the Secretary under section 483(a)(3)(E)) as in effect on such date of enactment, to be determined, the following: (I) section Information described under 6103(l)(13) of the Internal Revenue Code of 1986.
(II) All information provided by the applicant on the application described by this subsection to determine the applicant’s eligibility for Federal fi- nancial aid under this title and for the applica- tion, award, and administration of such Federal financial aid, except the name of an institution to which an applicant selects to redisclose informa- tion shall not be disclosed to any other institution.
(ii) AUTHORIZATION TO DISCLOSE TO BENEFITS PRO- GRAMS.—An applicant and, if necessary, the parents or spouse of the applicant may provide the Secretary with authorization to disclose to applicable agencies that handle applications for means-tested Federal benefit programs, as defined in section 479(b)(4)(H), all infor- mation provided by the applicant on the application described by this subsection as well as such applicant’s student aid index and scheduled Federal Pell Grant award to assist in identification, outreach and applica- tion efforts for the application, award, and administra- tion of such means-tested Federal benefits programs, except such information shall not include Federal tax information as specified in section 6103(l)(13)(C) of the Internal Revenue Code of 1986.
(E) ACTION BY THE SECRETARY.—Upon receiving— (i) an application under this section, the Secretary shall, as soon as practicable, perform the necessary functions with the Commissioner of Internal Revenue September 8, 2023 As Amended Through P.L.

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483 to calculate the applicant’s student aid index and scheduled award for a Federal Pell Grant, if applica- ble, assuming full-time enrollment for an academic year, and note to the applicant the assumptions rela- tionship to the scheduled award; and (ii) an authorization under subparagraph (D), the Secretary shall, as soon as practicable, disclose the in- formation described under such subparagraph, as spec- ified by the applicant, in order for the applicant’s eligi- bility for Federal, State, or institutional student finan- cial aid programs or means-tested Federal benefit pro- grams to be estimated or determined.
(F) WORK STUDY WAGES.—With respect to an applicant who has received income earned from work under part C of this title, the Secretary shall take the steps necessary to collect information on the amount of such income for the purposes of calculating such applicant’s student aid index and scheduled award for a Federal Pell Grant, if applica- ble, without adding additional questions to the FAFSA, in- cluding by collecting such information from institutions of higher education participating in work-study programs under part C of this title.
(3) INFORMATION TO BE SUPPLIED BY THE SECRETARY OF EDUCATION.— (A) IN GENERAL.—Upon receiving and timely proc- essing a free application that contains the information de- scribed in paragraph (2), the Secretary shall provide to the applicant the following information based on full-time at- tendance for an academic year: (i) The estimated dollar amount of a Federal Pell Grant scheduled award for which the applicant is eli- gible for such award year.
(ii) Information on other types of Federal financial aid for which the applicant may be eligible (including situations in which the applicant could qualify for 150 percent of a scheduled Federal Pell Grant award and loans made under this title) and how the applicant can find additional information regarding such aid.
(iii) Consumer-tested information regarding each institution selected by the applicant in accordance with paragraph (2)(B)(ii)(XI), which may include the fol- lowing: (I) The following information, as collected through the Integrated Postsecondary Education Data System or a successor Federal data system as designated by the Secretary: (aa) Net price by the income categories, as described under 132(i)(6), and section disaggregated by undergraduate and graduate programs, as applicable.

(bb) Graduation rate.


(cc) Retention rate.

(dd) Transfer rate, if available.

(II) Median debt of students upon completion.

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483 HIGHER EDUCATION ACT OF 1965 628 (III) Institutional default rate, as calculated under section 435.
(iv) If the student is eligible for a student aid index of less than or equal to zero under section 473, a notifi- cation of the Federal means-tested benefits that they have not already indicated they receive, but for which they may be eligible, and relevant links and informa- tion on how to apply for such benefits.
(v) Information on education tax benefits described in paragraphs (1) and (2) of section 25A(a) of the Inter- nal Revenue Code of 1986 or other applicable edu- cation tax benefits determined in consultation with the Secretary of the Treasury.
(vi) If the individual identified as a veteran, or as serving (on the date of the application) on active duty in the Armed Forces for other than training purposes, information on benefits administered by the Depart- ment of Veteran Affairs or Department of Defense, re- spectively.

(vii) If applicable, the applicant’s current out- standing balance of loans under this title.
(B) INFORMATION PROVIDED TO THE STATE.— (i) IN GENERAL.—The Secretary shall redisclose, with authorization from the applicant in accordance with paragraph (2)(D)(i), to a State higher education agency administering State-based financial aid and serving the applicant’s State of residence, the informa- tion described under section 6103(l)(13) of the Internal Revenue Code of 1986 and information described in paragraph (2)(B) for the application, award, and ad- ministration of grants and other student financial aid provided directly from the State to be determined by such State.
Such information shall include the list of institutions provided by the applicant on the applica- tion.
(ii) USE OF INFORMATION.—A State agency admin- istering State-based financial aid— (I) shall use the information provided under clause (i) solely for the application, award, and ad- ministration of State-based financial aid for which the applicant is eligible; (II) may use the information, except for the in- formation described under section 6103(l)(13) of the Internal Revenue Code of 1986, for State agen- cy research that does not release any individually identifiable information on any applicant to pro- mote college attendance, persistence, and comple- tion; (III) may use identifying information provided by student applicants on the FAFSA to determine whether or not a graduating secondary student has filed the application in coordination with local educational agencies or secondary schools to en- courage students to complete the application; and September 8, 2023 As Amended Through P.L.
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483 (IV) may share the application information, excluding the information described under section 6103(l)(13) of the Internal Revenue Code of 1986, with any other entity, only if such applicant pro- vides explicit written consent of the applicant, ex- cept as provided in subclause (III).
(iii) LIMITATION ON CONSENT PROCESS.—A State may provide a consent process whereby an applicant may elect to share the information described in clause (i), except for the information described in section 6103(l)(13) of the Internal Revenue Code of 1986, through explicit written consent to Federal, State, or local government agencies or tribal organizations to as- sist such applicant in applying for and receiving Fed- eral, State, or local government assistance, or tribal as- sistance for any component of the applicant’s cost of at- tendance that may include financial assistance or non- monetary assistance.
(iv) PROHIBITION.—Any entity that receives appli- cant information under clause (iii) shall not sell, share, or otherwise use applicant information other than for the purposes outlined in clause (iii).
(C) USE OF INFORMATION PROVIDED TO THE INSTITU- TION.—An institution— (i) shall use the information provided to it solely for the application, award, and administration of fi- nancial aid to the applicant; (ii) may use the information provided, excluding the information described under section 6013(l)(13) of the Internal Revenue Code of 1986, for research that does not release any individually identifiable informa- tion on any applicant, to promote college attendance, persistence, and completion; and (iii) shall not share such educational record infor- mation with any other entity without the explicit writ- ten consent of the applicant.
(D) PROHIBITION.—Any entity that receives applicant information under subparagraph (C)(iii) shall not sell, share, or otherwise use applicant information other than for the purposes outlined in subparagraph (C).
(E) FAFSA INFORMATION THAT INCLUDES TAX RETURN INFORMATION.—An applicant’s FAFSA information that in- cludes return or return information as described in section 6103(l)(13) of the Internal Revenue Code of 1986 may be disclosed or redisclosed (which shall include obtaining, sharing, or discussing such information) only in accordance with the procedures described in section 494.
(4) DEVELOPMENT OF FORM AND INFORMATION EXCHANGE.— Prior to the design of the free application under this subsection, the Secretary shall, to the maximum extent practicable, on an annual basis— (A) consult with stakeholders to gather information about innovations and technology available to— (i) ensure an efficient and effective process; September 8, 2023 As Amended Through P.L.
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483 HIGHER EDUCATION ACT OF 1965 630 (ii) mitigate unintended consequences; and (iii) determine the best practices for outreach to students and families during the transition to the streamlined process for the determination of Federal fi- nancial aid and Federal Pell Grant eligibility while re- ducing the data burden on applicants and families; and (B) solicit public comments for the format of the free application that provides for adequate time to incorporate feedback prior to development of the application for the suc- ceeding award year.
(5) NO ADDITIONAL INFORMATION REQUESTS PERMITTED.— In carrying out this subsection, the Secretary may not require additional information to be submitted by an applicant (or the parents or spouse of an applicant) for Federal financial aid through other requirements or reporting, except as required under a process or procedure exercised in accordance with the authority under section 479A.
(6) STATE-RUN PROGRAMS.— (A) IN GENERAL.—The Secretary shall conduct outreach to States in order to research the benefits to students of States relying solely on the student aid index, scheduled Pell Grant Award, or the financial data made available, upon authorization by the applicant, as a result of an ap- plication for aid under this subsection for determining the eligibility of the applicant for State provided financial aid.
(B) SECRETARIAL REVIEW.—If a State determines that there is a need for additional data elements beyond those provided pursuant to this subsection for determining the eligibility of an applicant for State provided financial aid, the State shall forward a list of those additional data ele- ments determined necessary, but not provided by virtue of the application under this subsection, to the Secretary.
The Secretary shall make readily available to the public through the Department’s websites and other means— (i) a list of States that do not require additional fi- nancial information separate from the Free Application for Federal Student Aid and do not require asset infor- mation from students who qualify for the exemption from asset reporting under section 479 for the purposes of awarding State scholarships and grant aid; (ii) a list of States that require asset information from students who qualify for the exemption from asset reporting under section 479 for the purposes of award- ing State scholarships and grant aid; (iii) a list of States that have indicated that they require additional financial information separate from the Free Application for Federal Student Aid for pur- poses of awarding State scholarships and grant aid; and (iv) with the publication of the lists under this sub- paragraph, information about additional resources available to applicants, including links to such State websites.
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483 (7) INSTITUTION-RUN FINANCIAL AID.— (A) IN GENERAL.—The Secretary shall conduct outreach to institutions of higher education to describe the benefits to students of relying solely on the student aid index, sched- uled Pell Grant Award, or the financial data made avail- able, upon authorization for release by the applicant, as a result of an application for aid under this subsection for de- termining the eligibility of the applicant for institutional fi- nancial aid.
The Secretary shall make readily available to the public through its websites and other means— (i) a list of institutions that do not require addi- tional financial information separate from the Free Ap- plication for Federal Student Aid and do not require asset information from students who qualify for the ex- emption from asset reporting under section 479 for the purpose of awarding institution-run financial aid; (ii) a list of institutions that require asset informa- tion from students who qualify for the exemption from asset reporting under section 479 for the purpose of awarding institution-run financial aid; (iii) a list of institutions that require additional fi- nancial information separate from the Free Application for Federal Student Aid for the purpose of awarding institution-run financial aid; and (iv) with the publication of the list in clause (iii), information about additional resources available to ap- plicants.
(8) SECURITY OF DATA.—The Secretary shall, in consulta- tion with the Secretary of the Treasury— (A) take all necessary steps to safeguard the data re- quired to be transmitted for the purpose of this section be- tween Federal agencies and to States and institutions of higher education and secure the transmittal of such data; (B) provide guidance to States and institutions of high- er education regarding their obligation to ensure the secu- rity of the data provided under this section and section 6103 of the Internal Revenue Code of 1986; and (C) provide guidance on the implementation of section 6103 of the Internal Revenue Code of 1986, including how it intersects with the provisions of section 444 of the Gen- eral Education Provisions Act (commonly known as the ‘‘Family Educational Rights and Privacy Act of 1974’’), and any additional consent processes that may be available to applicants in accordance with the Internal Revenue Code of 1986 regarding sharing of Federal tax information.
(9) REPORT TO CONGRESS.— (A) IN GENERAL.—Not later than 1 year after the date of enactment of the FAFSA Simplification Act, the Sec- retary shall report to the authorizing committees on the progress of the Secretary in carrying out this subsection, in- cluding planning and stakeholder consultation.

Such report shall include— (i) benchmarks for implementation; September 8, 2023 As Amended Through P.L.
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483 HIGHER EDUCATION ACT OF 1965 632 (ii) entities and organizations that the Secretary consulted; (iii) system requirements for such implementation and how they will be addressed; (iv) any areas of concern and potential problem issues uncovered that may hamper such implementa- tion; and (v) solutions determined to address such issues.
(B) UPDATES.—The Secretary shall provide updates to the authorizing committees— (i) as to the progress and planning described in subparagraph (A) prior to implementation of the revi- sions to the Free Application for Federal Student Aid under this subsection not less often than quarterly; and (ii) at least 6 months and 1 year after implementa- tion of the revisions to the Free Application for Federal Student Aid.
(b) ADJUSTMENTS AND IMPROVEMENTS.— (1) IN GENERAL.—The Secretary shall disclose in a con- sumer-tested format, upon completion of the Free Application for Federal Student Aid under this section, that the student may, on a case-by-case basis, qualify for an adjustment under section 479A to the cost of attendance or the values of the data items required to calculate the Federal Pell Grant or the need analysis for the student or parent.
Such disclosure shall speci- fy— (A) examples of the special circumstances under which a student or family member may qualify for such adjust- ment or determination of independence; and (B) additional information regarding the steps a stu- dent or family member may take in order to seek an adjust- ment under section 479A.
(2) CONSUMER TESTING.— (A) IN GENERAL.—Not later than 9 months after the date of enactment of the FAFSA Simplification Act, the Secretary shall begin consumer testing the design of the Free Application for Federal Student Aid under this section with prospective first-generation college students, represent- atives of students (including low-income students, English learners, first-generation college students, adult students, veterans, servicemembers, and prospective students), stu- dents’ families (including low-income families, families with English learners, families with first-generation college students, and families with prospective students), institu- tions of higher education, secondary school and postsec- ondary counselors, and nonprofit consumer groups.
(B) UPDATES.—For award year 2024–2025 and at least each fourth succeeding award year thereafter, the Secretary shall update the design of the Free Application for Federal Student Aid based on additional consumer testing with the populations described in subparagraph (A) in order to im- prove the usability and accessibility of the application.

(3) ACCESSIBILITY OF THE FAFSA.—The Secretary shall— September 8, 2023 As Amended Through P.L.
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483 (A) in conjunction with the Bureau of the Census, de- termine the most common languages spoken by English learner students and their parents in the United States; (B) develop and make publicly available versions of the Free Application for Federal Student Aid form in not fewer than 11 of the most common languages determined under subparagraph (A) and make such versions available and accessible to applicants in paper and electronic formats; and (C) ensure that the Free Application for Federal Stu- dent Aid is available in formats accessible to individuals with disabilities and compliant with the most recent Web Content Accessibility Guidelines, or successor guidelines.
(4) REAPPLICATION IN A SUCCEEDING ACADEMIC YEAR.—In order to streamline an applicant’s experience in applying for fi- nancial aid, the Secretary shall allow an applicant who elec- tronically applies for financial assistance under this title for an academic year subsequent to an academic year for which such applicant applied for financial assistance under this title to automatically electronically import all of the applicant’s (in- cluding parents’, guardians’, or spouses’, as applicable) identi- fying, demographic, and school data from the previous applica- tion and to update such information to reflect any cir- cumstances that have changed.
(5) TECHNOLOGY ACCESSIBILITY.—The Secretary shall make the application under this section available through prevalent technology.

Such technology shall, at a minimum, enable appli- cants to— (A) save data; and (B) submit the application under this title to the Sec- retary through such technology.
(6) VERIFICATION BURDEN.—The Secretary shall— (A) to the maximum extent practicable, streamline and simplify the process of verification for applicants for Fed- eral financial aid; (B) in establishing policies and procedures to verify ap- plicants’ eligibility for Federal financial aid, consider— (i) the burden placed on low-income applicants; (ii) the risk to low-income applicants of failing to complete the application, enroll in college, or complete a postsecondary credential as a result of being selected for verification; (iii) the effectiveness of the policies and procedures in preventing overpayments; and (iv) the reasons for the source of any improper pay- ments; and (C) issue a public report not less often than annually that includes the number and percentage of applicants sub- ject to verification, whether the applicants ultimately re- ceived Federal financial aid disbursements, the extent to which the student aid index changed for such applicants as a result of verification, and the extent to which such appli- cants’ eligibility for Federal financial aid under this title changed.
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483 HIGHER EDUCATION ACT OF 1965 634 (7) STUDIES.—The Secretary shall periodically conduct studies on— (A) whether the Free Application for Federal Student Aid is a barrier to college enrollment by examining— (i) the effect of States requiring additional infor- mation specified in clauses (ii) and (iii) of subsection (a)(6)(B) on the determination of State financial aid awards, including— (I) how much financial aid awards would change if the additional information were not re- quired; and (II) the number of students who started but did not finish the Free Application for Federal Student Aid, compared to the baseline year of 2021; and (ii) the number of students who— (I) started a Free Application for Federal Stu- dent Aid but did not receive financial assistance under this title for the applicable academic year; and (II) if available, did not enroll in an institu- tion of higher education in the applicable academic year; (B) the most common barriers faced by applicants in completing the Free Application for Federal Student Aid; and (C) the most common reasons that students and fami- lies do not fill out the Free Applications for Federal Stu- dent Aid.
(c) DATA AND INFORMATION.— (1) IN GENERAL.—The Secretary shall publish data in a publicly accessible manner— (A) annually on the total number of Free Applications for Federal Student Aid submitted by application cycle, disaggregated by demographic characteristics, type of insti- tution or institutions of higher education to which the ap- plicant applied, the applicant’s State of legal residence, and high school and public school district; (B) quarterly on the total number of Free Applications for Federal Student Aid submitted by application cycle, disaggregated by type of institution or institutions of higher education to which the applicant applied, the applicant’s State of legal residence, and high school and public school district; (C) weekly on the total number of Free Applications for Federal Student Aid submitted, disaggregated by high school and public school district; and (D) annually on the number of individuals who apply for federal financial aid pursuant to this section who indi- cated that they are— (i) an unaccompanied homeless youth or unaccom- panied, at risk of homelessness, and self-supporting; or (ii) a foster care youth.
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483 (2) CONTENTS.—The data described in paragraph (1)(D) with respect to homeless youth shall include, at a minimum, for each application cycle— (A) the total number of all applicants who were deter- mined to be individuals described in section 480(d)(8); and (B) the number of applicants described in subpara- graph (A), disaggregated— (i) by State; and (ii) by the sources of determination as described in section 479D(b).
(3) DATA SHARING.—The Secretary may enter into data sharing agreements with the appropriate Federal or State agen- cies to conduct outreach regarding, and connect applicants di- rectly with, the means-tested Federal benefit programs de- scribed in subsection (a)(2)(B)(ii)(XVII) for which the applicants may be eligible.
(d) ENSURING FORM USABILITY.— (1) SIGNATURE.—Notwithstanding any other provision of this title, the Secretary may permit the Free Application for Federal Student Aid to be submitted without a signature, if a signature is subsequently submitted by the applicant, or if the applicant uses an access device provided by the Secretary.
(2) FREE PREPARATION AUTHORIZED.—Notwithstanding any other provision of this title, an applicant may use a preparer for consultative or preparation services for the completion of the Free Application for Federal Student Aid without charging a fee to the applicant if the preparer— (A) includes, at the time the application is submitted to the Department, the name, address or employer’s address, social security number or employer identification number, and organizational affiliation of the preparer on the appli- cant’s form; (B) is subject to the same penalties as an applicant for purposely giving false or misleading information in the ap- plication; (C) clearly informs each individual upon initial con- tact, that the Free Application for Federal Student Aid is a free form that may be completed without professional as- sistance; and (D) does not produce, use, or disseminate any other form for the purpose of applying for Federal financial aid other than the Free Application for Federal Student Aid de- veloped by the Secretary under this section.
(3) CHARGES TO STUDENTS AND PARENTS FOR USE OF FORMS PROHIBITED.—The need for and eligibility of a student for financial assistance under this title may be determined only by using the Free Application for Federal Student Aid devel- oped by the Secretary under this section.
Such application shall be produced, distributed, and processed by the Secretary, and no parent or student shall be charged a fee by the Secretary, a contractor, a third-party servicer or private software provider, or any other public or private entity for the collection, proc- essing, or delivery of Federal financial aid through the use of such application.

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484 HIGHER EDUCATION ACT OF 1965 636 is charged shall be used to complete the Free Application for Federal Student Aid prescribed under this section, except that a Federal or State income tax form prepared by a paid income tax preparer or preparer service for the primary purpose of fil- ing a Federal or State income tax return may be used to com- plete the Free Application for Federal Student Aid prescribed under this section.
(4) APPLICATION PROCESSING CYCLE.—The Secretary shall enable applicants to submit a Free Application for Federal Stu- dent Aid developed under this section and initiate the proc- essing of such application, not later than January 1 of the ap- plicant’s planned year of enrollment, to the maximum extent practicable, on or around October 1 prior to the applicant’s planned year of enrollment.
(5) EARLY ESTIMATES.—The Secretary shall maintain an electronic method for applicants to enter income and family size information to calculate a non-binding estimate of the appli- cant’s Federal financial aid available under this title and shall place such calculator on a prominent location at the beginning of the Free Application for Federal Student Aid.
(6) ADDITIONAL FORMS.—Notwithstanding any other provi- sion of this title, an institution may not condition the packaging or receipt of Federal financial aid on the completion of addi- tional requests for financial information beyond the Free Appli- cation for Federal Student Aid, unless such information is re- quired for verification, a determination of independence, or pro- fessional judgement.

SEC.

484. ø20 U.S.C.

1091¿ STUDENT ELIGIBILITY.
(a) IN GENERAL.—In order to receive any grant, loan, or work assistance under this title, a student must— (1) be enrolled or accepted for enrollment in a degree, cer- tificate, or other program (including a program of study abroad approved for credit by the eligible institution at which such student is enrolled) leading to a recognized educational creden- tial at an institution of higher education that is an eligible in- stitution in accordance with the provisions of section 487, ex- cept as provided in subsections (b)(3) and (b)(4), and not be en- rolled in an elementary or secondary school; (2) if the student is presently enrolled at an institution, be maintaining satisfactory progress in the course of study the student is pursuing in accordance with the provisions of sub- section (c); (3) not owe a refund on grants previously received at any institution under this title, or be in default on any loan from a student loan fund at any institution provided for in part E, or a loan made, insured, or guaranteed by the Secretary under this title for attendance at any institution; (4) file with the Secretary, as part of the original financial aid application process, a certification, which need not be nota- rized, but which shall include— (A) a statement of educational purpose stating that the money attributable to such grant, loan, or loan guar- September 8, 2023 As Amended Through P.L.
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484 antee will be used solely for expenses related to attend- ance or continued attendance at such institution; and (B) such student’s social security number; (5) be a citizen or national of the United States, a perma- nent resident of the United States, or able to provide evidence from the Immigration and Naturalization Service that he or she is in the United States for other than a temporary purpose with the intention of becoming a citizen or permanent resident; and (6) if the student has been convicted of, or has pled nolo contendere or guilty to, a crime involving fraud in obtaining funds under this title, have completed the repayment of such funds to the Secretary, or to the holder in the case of a loan under this title obtained by fraud.
(b) ELIGIBILITY FOR STUDENT LOANS.—(1) In order to be eligi- ble to receive any loan under this title (other than a loan under section 428B or 428C, or under section 428H pursuant to an exer- cise of discretion under section 479A) for any period of enrollment, a student who is not a graduate or professional student (as defined in regulations of the Secretary), and who is enrolled in a program at an institution which has a participation agreement with the Sec- retary to make awards under subpart 1 of part A of this title, shall— (A)(i) have received a determination of eligibility or ineligi- bility for a Pell Grant under such subpart 1 for such period of enrollment; and (ii) if determined to be eligible, have filed an application for a Pell Grant for such enrollment period; or (B) have (A) filed an application with the Pell Grant proc- essor for such institution for such enrollment period, and (B) received from the financial aid administrator of the institution a preliminary determination of the student’s eligibility or ineli- gibility for a grant under such subpart 1.
(2) In order to be eligible to receive any loan under section 428A for any period of enrollment, a student shall— (A) have received a determination of need for a loan under section 428(a)(2)(B) of this title; (B) if determined to have need for a loan under section 428, have applied for such a loan; and (C) has applied for a loan under section 428H, if such stu- dent is eligible to apply for such a loan.
(3) A student who— (A) is carrying at least one-half the normal full-time work load for the course of study that the student is pursuing, as de- termined by an eligible institution, and (B) is enrolled in a course of study necessary for enroll- ment in a program leading to a degree or certificate, shall be, notwithstanding paragraph (1) of subsection (a), eligible to apply for loans under part B or D of this title.

The eligibility de- scribed in this paragraph shall be restricted to one 12-month pe- riod.
(4) A student who— (A) is carrying at least one-half the normal full-time work load for the course of study the student is pursuing, as deter- mined by the institution, and September 8, 2023 As Amended Through P.L.

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484 HIGHER EDUCATION ACT OF 1965 638 (B) is enrolled or accepted for enrollment in a program at an eligible institution necessary for a professional credential or certification from a State that is required for employment as a teacher in an elementary or secondary school in that State, shall be, notwithstanding paragraph (1) of subsection (a), eligible to apply for loans under part B, D, or E or work-study assistance under part C of this title.
(5) Notwithstanding any other provision of this subsection, no incarcerated student is eligible to receive a loan under this title.
(c) SATISFACTORY PROGRESS.—(1) For the purpose of subsection (a)(2), a student is maintaining satisfactory progress if— (A) the institution at which the student is in attendance, reviews the progress of the student at the end of each aca- demic year, or its equivalent, as determined by the institution, and (B) the student has a cumulative C average, or its equiva- lent or academic standing consistent with the requirements for graduation, as determined by the institution, at the end of the second such academic year.
(2) Whenever a student fails to meet the eligibility require- ments of subsection (a)(2) as a result of the application of this sub- section and subsequent to that failure the student has academic standing consistent with the requirements for graduation, as deter- mined by the institution, for any grading period, the student may, subject to this subsection, again be eligible under subsection (a)(2) for a grant, loan, or work assistance under this title.
(3) Any institution of higher education at which the student is in attendance may waive the provisions of paragraph (1) or para- graph (2) of this subsection for undue hardship based on— (A) the death of a relative of the student, (B) the personal injury or illness of the student, or (C) special circumstances as determined by the institution.
(d) STUDENTS WHO ARE NOT HIGH SCHOOL GRADUATES.— (1) STUDENT ELIGIBILITY.—In order for a student who does not have a certificate of graduation from a school providing secondary education, or the recognized equivalent of such cer- tificate, to be eligible for any assistance under subparts 1, 3, and 4 of part A and parts B, C, D, and E of this title, the stu- dent shall meet the requirements of one of the following sub- paragraphs: (A) The student is enrolled in an eligible career path- way program and meets one of the following standards: (i) The student shall take an independently ad- ministered examination and shall achieve a score, specified by the Secretary, demonstrating that such student can benefit from the education or training being offered.
Such examination shall be approved by the Secretary on the basis of compliance with such standards for development, administration, and scor- ing as the Secretary may prescribe in regulations.

(ii) The student shall be determined as having the ability to benefit from the education or training in ac- cordance with such process as the State shall pre- scribe.

Any such process described or approved by a September 8, 2023 As Amended Through P.L.
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484 State for the purposes of this section shall be effective 6 months after the date of submission to the Secretary unless the Secretary disapproves such process.
In de- termining whether to approve or disapprove such proc- ess, the Secretary shall take into account the effective- ness of such process in enabling students without sec- ondary school diplomas or the equivalent thereof to benefit from the instruction offered by institutions uti- lizing such process, and shall also take into account the cultural diversity, economic circumstances, and educational preparation of the populations served by the institutions.
(iii) The student shall be determined by the insti- tution of higher education as having the ability to ben- efit from the education or training offered by the insti- tution of higher education upon satisfactory comple- tion of 6 credit hours or the equivalent coursework that are applicable toward a degree or certificate of- fered by the institution of higher education.
(B) The student has completed a secondary school edu- cation in a home school setting that is treated as a home school or private school under State law.
(2) 57 ELIGIBLE CAREER PATHWAY PROGRAM.—In this sub- section, the term ‘‘eligible career pathway program’’ means a program that combines rigorous and high-quality education, training, and other services that— (A) aligns with the skill needs of industries in the economy of the State or regional economy involved; (B) prepares an individual to be successful in any of a full range of secondary or postsecondary education op- tions, including apprenticeships registered under the Act of August 16, 1937 (commonly known as the ‘‘National Ap- prenticeship Act’’; 50 Stat.
664, chapter 663; 29 U.S.C.

50 et seq.)
(referred to individually in this Act as an ‘‘appren- ticeship’’, except in section 171); (C) includes counseling to support an individual in achieving the individual’s education and career goals; (D) includes, as appropriate, education offered concur- rently with and in the same context as workforce prepara- tion activities and training for a specific occupation or oc- cupational cluster; (E) organizes education, training, and other services to meet the particular needs of an individual in a manner that accelerates the educational and career advancement of the individual to the extent practicable; (F) enables an individual to attain a secondary school diploma or its recognized equivalent, and at least 1 recog- nized postsecondary credential; and 57 Section 313(1) of division H of Public Law 114–113 provides for an amendment ‘‘by replac- ing (d)(2)’’ and inserting a new paragraph (2).
Such amendment was carried out by striking sub- section (d)(2) in its entirety and inserting a new paragraph (2) to reflect the probable intent of Congress.

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484 HIGHER EDUCATION ACT OF 1965 640 (G) helps an individual enter or advance within a spe- cific occupation or occupational cluster.
(e) CERTIFICATION FOR GSL ELIGIBILITY.—Each eligible institu- tion may certify student eligibility for a loan by an eligible lender under part B of this title prior to completing the review for accu- racy of the information submitted by the applicant required by reg- ulations issued under this title, if— (1) checks for the loans are mailed to the eligible institu- tion prior to disbursements; (2) the disbursement is not made until the review is com- plete; and (3) the eligible institution has no evidence or documenta- tion on which the institution may base a determination that the information submitted by the applicant is incorrect.
(f) LOSS OF ELIGIBILITY FOR VIOLATION OF LOAN LIMITS.—(1) No student shall be eligible to receive any grant, loan, or work as- sistance under this title if the eligible institution determines that the student fraudulently borrowed in violation of the annual loan limits under part B, part D, or part E of this title in the same aca- demic year, or if the student fraudulently borrowed in excess of the aggregate maximum loan limits under such part B, part D, or part E. (2) If the institution determines that the student inadvertently borrowed amounts in excess of such annual or aggregate maximum loan limits, such institution shall allow the student to repay any amount borrowed in excess of such limits prior to certifying the student’s eligibility for further assistance under this title.
(g) VERIFICATION OF IMMIGRATION STATUS.— (1) IN GENERAL.—The Secretary shall implement a system under which the statements and supporting documentation, if required, of an individual declaring that such individual is in compliance with the requirements of subsection (a)(5) shall be verified prior to the individual’s receipt of a grant, loan, or work assistance under this title.
(2) SPECIAL RULE.—The documents collected and main- tained by an eligible institution in the admission of a student to the institution may be used by the student in lieu of the doc- uments used to establish both employment authorization and identity under section 274A(b)(1)(B) of the Immigration and Nationality Act (8 U.S.C.

1324a) to verify eligibility to partici- pate in work-study programs under part C of this title.
(3) VERIFICATION MECHANISMS.—The Secretary is author- ized to verify such statements and supporting documentation through a data match, using an automated or other system, with other Federal agencies that may be in possession of infor- mation relevant to such statements and supporting documenta- tion.
(4) REVIEW.—In the case of such an individual who is not a citizen or national of the United States, if the statement de- scribed in paragraph (1) is submitted but the documentation required under paragraph (2) is not presented or if the docu- mentation required under paragraph (2)(A) is presented but such documentation is not verified under paragraph (3)— (A) the institution— September 8, 2023 As Amended Through P.L.
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484 (i) shall provide a reasonable opportunity to sub- mit to the institution evidence indicating a satisfactory immigration status, and (ii) may not delay, deny, reduce, or terminate the individual’s eligibility for the grant, loan, or work as- sistance on the basis of the individual’s immigration status until such a reasonable opportunity has been provided; and (B) if there are submitted documents which the insti- tution determines constitute reasonable evidence indi- cating such status— (i) the institution shall transmit to the Immigra- tion and Naturalization Service either photostatic or other similar copies of such documents, or information from such documents, as specified by the Immigration and Naturalization Service, for official verification, (ii) pending such verification, the institution may not delay, deny, reduce, or terminate the individual’s eligibility for the grant, loan, or work assistance on the basis of the individual’s immigration status, and (iii) the institution shall not be liable for the con- sequences of any action, delay, or failure of the Service to conduct such verification.
(h) LIMITATIONS OF ENFORCEMENT ACTIONS AGAINST INSTITU- TIONS.—The Secretary shall not take any compliance, disallowance, penalty, or other regulatory action against an institution of higher education with respect to any error in the institution’s determina- tion to make a student eligible for a grant, loan, or work assistance based on citizenship or immigration status— (1) if the institution has provided such eligibility based on a verification of satisfactory immigration status by the Immi- gration and Naturalization Service, (2) because the institution, under subsection (g)(4)(A)(i), was required to provide a reasonable opportunity to submit documentation, or (3) because the institution, under subsection (g)(4)(B)(i), was required to wait for the response of the Immigration and Naturalization Service to the institution’s request for official verification of the immigration status of the student.
(i) VALIDITY OF LOAN GUARANTEES FOR LOAN PAYMENTS MADE BEFORE IMMIGRATION STATUS VERIFICATION COMPLETED.—Notwith- standing subsection (h), if— (1) a guaranty is made under this title for a loan made with respect to an individual, (2) at the time the guaranty is entered into, the provisions of subsection (h) had been complied with, (3) amounts are paid under the loan subject to such guar- anty, and (4) there is a subsequent determination that, because of an unsatisfactory immigration status, the individual is not eligible for the loan, the official of the institution making the determination shall notify and instruct the entity making the loan to cease further payments under the loan, but such guaranty shall not be voided or otherwise September 8, 2023 As Amended Through P.L.
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484 HIGHER EDUCATION ACT OF 1965 642 nullified with respect to such payments made before the date the entity receives the notice.
(k) 58 SPECIAL RULE FOR CORRESPONDENCE COURSES.—A stu- dent shall not be eligible to receive grant, loan, or work assistance under this title for a correspondence course unless such course is part of a program leading to an associate, bachelor or graduate de- gree.
(l) COURSES OFFERED THROUGH DISTANCE EDUCATION.— (1) RELATION TO CORRESPONDENCE COURSES.— (A) IN GENERAL.—A student enrolled in a course of in- struction at an institution of higher education that is of- fered principally through distance education and leads to a recognized certificate, or recognized associate, recognized baccalaureate, or recognized graduate degree, conferred by such institution, shall not be considered to be enrolled in correspondence courses.
(B) EXCEPTION.—An institution of higher education re- ferred to in subparagraph (A) shall not include an institu- tion or school described in section 3(3)(C) of the Carl D. Perkins Career and Technical Education Act of 2006.
(2) REDUCTIONS OF FINANCIAL AID.—A student’s eligibility to receive grants, loans, or work assistance under this title shall be reduced if a financial aid officer determines under the discretionary authority provided in section 479A that distance education results in a substantially reduced cost of attendance to such student.
(3) SPECIAL RULE.—For award years beginning prior to July 1, 2008, the Secretary shall not take any compliance, dis- allowance, penalty, or other action based on a violation of this subsection against a student or an eligible institution when such action arises out of such institution’s prior award of stu- dent assistance under this title if the institution demonstrates to the satisfaction of the Secretary that its course of instruction would have been in conformance with the requirements of this subsection.
(m) STUDENTS WITH A FIRST BACCALAUREATE OR PROFES- SIONAL DEGREE.—A student shall not be ineligible for assistance under parts B, C, D, and E of this title because such student has previously received a baccalaureate or professional degree.

(n) STUDY ABROAD.—Nothing in this Act shall be construed to limit or otherwise prohibit access to study abroad programs ap- proved by the home institution at which a student is enrolled.
An otherwise eligible student who is engaged in a program of study abroad approved for academic credit by the home institution at which the student is enrolled shall be eligible to receive grant, loan, or work assistance under this title, without regard to whether such study abroad program is required as part of the student’s de- gree program.
(o) VERIFICATION OF SOCIAL SECURITY NUMBER.—The Sec- retary of Education, in cooperation with the Commissioner of the Social Security Administration, shall verify any social security September 8, 2023 As Amended Through P.L.

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484 number provided by a student to an eligible institution under sub- section (a)(4) and shall enforce the following conditions: (1) Except as provided in paragraphs (2) and (3), an insti- tution shall not deny, reduce, delay, or terminate a student’s eligibility for assistance under this part because social security number verification is pending.
(2) If there is a determination by the Secretary that the so- cial security number provided to an eligible institution by a student is incorrect, the institution shall deny or terminate the student’s eligibility for any grant, loan, or work assistance under this title until such time as the student provides docu- mented evidence of a social security number that is determined by the institution to be correct.
(3) If there is a determination by the Secretary that the so- cial security number provided to an eligible institution by a student is incorrect, and a correct social security number can- not be provided by such student, and a loan has been guaran- teed for such student under part B of this title, the institution shall notify and instruct the lender and guaranty agency mak- ing and guaranteeing the loan, respectively, to cease further disbursements of the loan, but such guaranty shall not be void- ed or otherwise nullified with respect to such disbursements made before the date that the lender and the guaranty agency receives such notice.
(4) Nothing in this subsection shall permit the Secretary to take any compliance, disallowance, penalty, or other regu- latory action against— (A) any institution of higher education with respect to any error in a social security number, unless such error was a result of fraud on the part of the institution; or (B) any student with respect to any error in a social security number, unless such error was a result of fraud on the part of the student.
(p) USE OF INCOME DATA WITH IRS.—The Secretary, in co- operation with the Secretary of the Treasury, shall fulfill the data transfer requirements under section 6103(l)(13) of the Internal Rev- enue Code of 1986 and the procedure and requirements outlined in section 494.
(q) STUDENTS WITH INTELLECTUAL DISABILITIES.— (1) DEFINITIONS.—In this subsection the terms ‘‘com- prehensive transition and postsecondary program for students with intellectual disabilities’’ and ‘‘student with an intellectual disability’’ have the meanings given the terms in section 760.
(2) REQUIREMENTS.—Notwithstanding subsections (a), (c), and (d), in order to receive any grant or work assistance under section 401, subpart 3 of part A, or part C, a student with an intellectual disability shall— (A) be enrolled or accepted for enrollment in a com- prehensive transition and postsecondary program for stu- dents with intellectual disabilities at an institution of higher education; (B) be maintaining satisfactory progress in the pro- gram as determined by the institution, in accordance with standards established by the institution; and September 8, 2023 As Amended Through P.L.
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484 HIGHER EDUCATION ACT OF 1965 644 (C) meet the requirements of paragraphs (3), (4), (5), and (6) of subsection (a).
(3) AUTHORITY.—Notwithstanding any other provision of law unless such provision is enacted with specific reference to this section, the Secretary is authorized to waive any statutory provision applicable to the student financial assistance pro- grams under section 401, subpart 3 of part A, or part C (other than a provision of part F related to such a program), or any institutional eligibility provisions of this title, as the Secretary determines necessary to ensure that programs enrolling stu- dents with intellectual disabilities otherwise determined to be eligible under this subsection may receive such financial assist- ance.
(4) REGULATIONS.—Notwithstanding regulations applicable to grant or work assistance awards made under section 401, subpart 3 of part A, and part C (other than a regulation under part F related to such an award), including with respect to eli- gible programs, instructional time, credit status, and enroll- ment status as described in section 481, the Secretary shall promulgate regulations allowing programs enrolling students with intellectual disabilities otherwise determined to be eligi- ble under this subsection to receive such awards.
(r) DATA ANALYSIS ON ACCESS TO FEDERAL STUDENT AID FOR CERTAIN POPULATIONS.— (1) DEVELOPMENT OF THE SYSTEM.—Within one year of en- actment of the Higher Education Opportunity Act, the Sec- retary shall analyze data from the FAFSA containing informa- tion regarding the number, characteristics, and circumstances of students denied Federal student aid based on a drug convic- tion while receiving Federal aid.
(2) RESULTS FROM ANALYSIS.—The results from the anal- ysis of such information shall be made available on a contin- uous basis via the Department website and the Digest of Edu- cation Statistics.

(3) DATA UPDATING.—The data analyzed under this sub- section shall be updated at the beginning of each award year and at least one additional time during such award year.
(4) REPORT TO CONGRESS.—The Secretary shall prepare and submit to the authorizing committees, in each fiscal year, a report describing the results obtained by the establishment and operation of the data system authorized by this subsection.

(s) EXCEPTION TO REQUIRED REGISTRATION WITH THE SELEC- TIVE SERVICE SYSTEM.—Notwithstanding section 12(f) of the Mili- tary Selective Service Act (50 U.S.C.
3811(f)), an individual shall not be ineligible for assistance or a benefit provided under this title if the individual is required under section 3 of such Act (50 U.S.C.

3802) to present himself for and submit to registration under such section and fails to do so in accordance with any proclamation issued under such section, or in accordance with any rule or regula- tion issued under such section.
(t) CONFINED OR INCARCERATED INDIVIDUALS.— (1) DEFINITIONS.—In this subsection: (A) CONFINED OR INCARCERATED INDIVIDUAL.—The term ‘‘confined or incarcerated individual’’— September 8, 2023 As Amended Through P.L.

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484 (i) means an individual who is serving a criminal sentence in a Federal, State, or local penal institution, prison, jail, reformatory, work farm, or other similar correctional institution; and (ii) does not include an individual who is in a half- way house or home detention or is sentenced to serve only weekends.
(B) PRISON EDUCATION PROGRAM.—The term ‘‘prison education program’’ means an education or training pro- gram that— (i) is an eligible program under this title offered by an institution of higher education (as defined in section 101 or 102(a)(1)(B)); (ii) is offered by an institution that has been ap- proved to operate in a correctional facility by the ap- propriate State department of corrections or other en- tity that is responsible for overseeing correctional fa- cilities, or by the Bureau of Prisons; (iii) has been determined by the appropriate State department of corrections or other entity that is re- sponsible for overseeing correctional facilities, or by the Bureau of Prisons, to be operating in the best in- terest of students, the determination of which shall be made by the State department of corrections or other entity or by the Bureau of Prisons, respectively, and may be based on— (I) rates of confined or incarcerated individ- uals continuing their education post-release; (II) job placement rates for such individuals; (III) earnings for such individuals; (IV) rates of recidivism for such individuals; (V) the experience, credentials, and rates of turnover or departure of instructors; (VI) the transferability of credits for courses available to confined or incarcerated individuals and the applicability of such credits toward re- lated degree or certificate programs; or (VII) offering relevant academic and career advising services to participating confined or in- carcerated individuals while they are confined or incarcerated, in advance of reentry, and upon re- lease; (iv) offers transferability of credits to at least 1 in- stitution of higher education (as defined in section 101 or 102(a)(1)(B)) in the State in which the correctional facility is located, or, in the case of a Federal correc- tional facility, in the State in which most of the indi- viduals confined or incarcerated in such facility will reside upon release; (v) is offered by an institution that has not been subject, during the 5 years preceding the date of the determination, to— (I) any suspension, emergency action, or ter- mination of programs under this title; September 8, 2023 As Amended Through P.L.
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484 HIGHER EDUCATION ACT OF 1965 646 (II) any adverse action by the institution’s ac- crediting agency or association; or (III) any action by the State to revoke a li- cense or other authority to operate; (vi) satisfies any applicable educational require- ments for professional licensure or certification, in- cluding licensure or certification examinations needed to practice or find employment in the sectors or occu- pations for which the program prepares the individual, in the State in which the correctional facility is located or, in the case of a Federal correctional facility, in the State in which most of the individuals confined or in- carcerated in such facility will reside upon release; and (vii) does not offer education that is designed to lead to licensure or employment for a specific job or oc- cupation in the State if such job or occupation typi- cally involves prohibitions on the licensure or employ- ment of formerly incarcerated individuals in the State in which the correctional facility is located, or, in the case of a Federal correctional facility, in the State in which most of the individuals confined or incarcerated in such facility will reside upon release.
(2) TECHNICAL ASSISTANCE.—The Secretary, in collabora- tion with the Attorney General, shall provide technical assist- ance and guidance to the Bureau of Prisons, State departments of corrections, and other entities that are responsible for over- seeing correctional facilities in making determinations under paragraph (1)(B)(iii).
(3) FEDERAL PELL GRANT ELIGIBILITY.—Notwithstanding subsection (a), in order for a confined or incarcerated indi- vidual who otherwise meets the eligibility requirements of this title to be eligible to receive a Federal Pell Grant under section 401, the individual shall be enrolled or accepted for enrollment in a prison education program.
(4) EVALUATION.— (A) IN GENERAL.—Not later than 1 year after the date of enactment of the FAFSA Simplification Act, in order to evaluate and improve the impact of activities supported under this subsection, the Secretary, in partnership with the Director of the Institute of Education Sciences, shall award 1 or more grants or contracts to, or enter into coop- erative agreements with, experienced public and private institutions and organizations to enable the institutions and organizations to conduct an external evaluation that shall— (i) assess the ability of confined or incarcerated in- dividuals to access and complete the Free Application for Federal Student Aid; (ii) examine in-custody outcomes and post-release outcomes related to providing Federal Pell Grants to confined or incarcerated individuals, including— (I) attainment of a postsecondary degree or credential; September 8, 2023 As Amended Through P.L.
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484 (II) safety in penal institutions with prison education programs; (III) the size of waiting lists for prison edu- cation programs; (IV) the extent to which such individuals con- tinue their education post-release; (V) employment and earnings outcomes for such individuals; and (VI) rates of recidivism for such individuals; (iii) track individuals who received Federal Pell Grants under subpart 1 of part A at 1, 3, and 5 years after the individuals’ release from confinement or in- carceration; and (iv) examine the extent to which institutions pro- vide re-entry or relevant career services to partici- pating confined or incarcerated individuals as part of the prison education program and the efficacy of such services, if offered.
(B) REPORT.—Beginning not later than 1 year after the Secretary awards the grant, contract, or cooperative agreement described in subparagraph (A) and annually thereafter, each institution of higher education operating a prison education program under this subsection shall sub- mit a report to the Secretary on activities assisted and stu- dents served under this subsection, which shall include the information, as applicable, contained in clauses (i) through (iv) of subparagraph (A).
(5) REPORT.—Not later than 1 year after the date of enact- ment of the FAFSA Simplification Act and on at least an an- nual basis thereafter, the Secretary shall submit to the author- izing committees, and make publicly available on the website of the Department, a report on the— (A) impact of this subsection which shall include, at a minimum— (i) the names and types of institutions of higher education offering prison education programs at which confined or incarcerated individuals are enrolled and receiving Federal Pell Grants; (ii) the number of confined or incarcerated individ- uals receiving Federal Pell Grants through each prison education program; (iii) the amount of Federal Pell Grant expendi- tures for each prison education program; (iv) the average amount of Federal Pell Grant ex- penditures per full-time equivalent students in a pris- on education program compared to the average amount of Federal Pell Grant expenditures per full- time equivalent students not in prison education pro- grams; (v) the demographics of confined or incarcerated individuals receiving Federal Pell Grants; (vi) the cost of attendance for such individuals; September 8, 2023 As Amended Through P.L.
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484A HIGHER EDUCATION ACT OF 1965 648 (vii) the mode of instruction (such as distance edu- cation, in-person instruction, or a combination of such modes) for each prison education program; (viii) information on the academic outcomes of such individuals (such as credits attempted and earned, and credential and degree completion) and any information available from student satisfaction sur- veys conducted by the applicable institution or correc- tional facility; (ix) information on post-release outcomes of such individuals, including, to the extent practicable, con- tinued postsecondary enrollment, earnings, credit transfer, and job placement; (x) rates of recidivism for confined or incarcerated individuals receiving Federal Pell Grants; (xi) information on transfers of confined or incar- cerated individuals between prison education pro- grams; (xii) the most common programs and courses of- fered in prison education programs; and (xiii) rates of instructor turnover or departure for courses offered in prison education programs; (B) results of each prison education program at each institution of higher education, including the information described in clauses (ii) through (xiii) of subparagraph (A); and (C) findings regarding best practices with respect to prison education programs.
SEC.

484A.

ø20 U.S.C.

1091a¿ STATUTE OF LIMITATIONS, AND STATE COURT JUDGMENTS.

(a) IN GENERAL.—(1) It is the purpose of this subsection to en- sure that obligations to repay loans and grant overpayments are enforced without regard to any Federal or State statutory, regu- latory, or administrative limitation on the period within which debts may be enforced.
(2) Notwithstanding any other provision of statute, regulation, or administrative limitation, no limitation shall terminate the pe- riod within which suit may be filed, a judgment may be enforced, or an offset, garnishment, or other action initiated or taken by— (A) an institution that receives funds under this title that is seeking to collect a refund due from a student on a grant made, or work assistance awarded, under this title; (B) a guaranty agency that has an agreement with the Secretary under section 428(c) that is seeking the repayment of the amount due from a borrower on a loan made under part B of this title after such guaranty agency reimburses the pre- vious holder of the loan for its loss on account of the default of the borrower; (C) an institution that has an agreement with the Sec- retary pursuant to section 453 or 463(a) that is seeking the re- payment of the amount due from a borrower on a loan made under part D or E of this title after the default of the borrower on such loan; or September 8, 2023 As Amended Through P.L.
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484B (D) the Secretary, the Attorney General, or the administra- tive head of another Federal agency, as the case may be, for payment of a refund due from a student on a grant made under this title, or for the repayment of the amount due from a borrower on a loan made under this title that has been as- signed to the Secretary under this title.
(b) ASSESSMENT OF COSTS AND OTHER CHARGES.—Notwith- standing any provision of State law to the contrary— (1) a borrower who has defaulted on a loan made under this title shall be required to pay, in addition to other charges specified in this title, reasonable collection costs; (2) in collecting any obligation arising from a loan made under part B of this title, a guaranty agency or the Secretary shall not be subject to a defense raised by any borrower based on a claim of infancy; and (3) in collecting any obligation arising from a loan made under part E, an institution of higher education that has an agreement with the Secretary pursuant to section 463(a) shall not be subject to a defense raised by any borrower based on a claim of infancy.
(c) STATE COURT JUDGMENTS.—A judgment of a State court for the recovery of money provided as grant, loan, or work assistance under this title that has been assigned or transferred to the Sec- retary under this title may be registered in any district court of the United States by filing a certified copy of the judgment and a copy of the assignment or transfer.
A judgment so registered shall have the same force and effect, and may be enforced in the same man- ner, as a judgment of the district court of the district in which the judgment is registered.

(d) SPECIAL RULE.—This section shall not apply in the case of a student who is deceased, or to a deceased student’s estate or the estate of such student’s family.
If a student is deceased, then the student’s estate or the estate of the student’s family shall not be required to repay any financial assistance under this title, includ- ing interest paid on the student’s behalf, collection costs, or other charges specified in this title.

SEC.

484B.

ø20 U.S.C.

1091b¿ INSTITUTIONAL REFUNDS.


(a) RETURN OF TITLE IV FUNDS.— (1) IN GENERAL.—If a recipient of assistance under this title withdraws from an institution during a payment period or period of enrollment in which the recipient began attendance, the amount of grant or loan assistance (other than assistance received under part C) to be returned to the title IV programs is calculated according to paragraph (3) and returned in ac- cordance with subsection (b).
(2) LEAVE OF ABSENCE.— (A) LEAVE NOT TREATED AS WITHDRAWAL.—In the case of a student who takes 1 or more leaves of absence from an institution for not more than a total of 180 days in any 12-month period, the institution may consider the student as not having withdrawn from the institution during the leave of absence, and not calculate the amount of grant September 8, 2023 As Amended Through P.L.
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484B HIGHER EDUCATION ACT OF 1965 650 and loan assistance provided under this title that is to be returned in accordance with this section if— (i) the institution has a formal policy regarding leaves of absence; (ii) the student followed the institution’s policy in requesting a leave of absence; and (iii) the institution approved the student’s request in accordance with the institution’s policy.
(B) CONSEQUENCES OF FAILURE TO RETURN.—If a stu- dent does not return to the institution at the expiration of an approved leave of absence that meets the requirements of subparagraph (A), the institution shall calculate the amount of grant and loan assistance provided under this title that is to be returned in accordance with this section based on the day the student withdrew (as determined under subsection (c)).
(3) CALCULATION OF AMOUNT OF TITLE IV ASSISTANCE EARNED.— (A) IN GENERAL.—The amount of grant or loan assist- ance under this title that is earned by the recipient for purposes of this section is calculated by— (i) determining the percentage of grant and loan assistance under this title that has been earned by the student, as described in subparagraph (B); and (ii) applying such percentage to the total amount of such grant and loan assistance that was disbursed (and that could have been disbursed) to the student, or on the student’s behalf, for the payment period or period of enrollment for which the assistance was awarded, as of the day the student withdrew.
(B) PERCENTAGE EARNED.—For purposes of subpara- graph (A)(i), the percentage of grant or loan assistance under this title that has been earned by the student is— (i) equal to the percentage of the payment period or period of enrollment for which assistance was awarded that was completed (as determined in accord- ance with subsection (d)) as of the day the student withdrew, provided that such date occurs on or before the completion of 60 percent of the payment period or period of enrollment; or (ii) 100 percent, if the day the student withdrew occurs after the student has completed (as determined in accordance with subsection (d)) 60 percent of the payment period or period of enrollment.
(C) PERCENTAGE AND AMOUNT NOT EARNED.—For pur- poses of subsection (b), the amount of grant and loan as- sistance awarded under this title that has not been earned by the student shall be calculated by— (i) determining the complement of the percentage of grant assistance under subparts 1 and 3 of part A, or loan assistance under parts B, D, and E, that has been earned by the student described in subparagraph (B); and September 8, 2023 As Amended Through P.L.
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484B (ii) applying the percentage determined under clause (i) to the total amount of such grant and loan assistance that was disbursed (and that could have been disbursed) to the student, or on the student’s be- half, for the payment period or period of enrollment, as of the day the student withdrew.
(4) DIFFERENCES BETWEEN AMOUNTS EARNED AND AMOUNTS RECEIVED.— (A) IN GENERAL.—After determining the eligibility of the student for a late disbursement or post-withdrawal dis- bursement (as required in regulations prescribed by the Secretary), the institution of higher education shall contact the borrower and obtain confirmation that the loan funds are still required by the borrower.
In making such contact, the institution shall explain to the borrower the borrower’s obligation to repay the funds following any such disburse- ment.

The institution shall document in the borrower’s file the result of such contact and the final determination made concerning such disbursement.
(B) RETURN.—If the student has received more grant or loan assistance than the amount earned as calculated under paragraph (3)(A), the unearned funds shall be re- turned by the institution or the student, or both, as may be required under paragraphs (1) and (2) of subsection (b), to the programs under this title in the order specified in subsection (b)(3).
(b) RETURN OF TITLE IV PROGRAM FUNDS.— (1) RESPONSIBILITY OF THE INSTITUTION.—The institution shall return not later than 45 days from the determination of withdrawal, in the order specified in paragraph (3), the lesser of— (A) the amount of grant and loan assistance awarded under this title that has not been earned by the student, as calculated under subsection (a)(3)(C); or (B) an amount equal to— (i) the total institutional charges incurred by the student for the payment period or period of enrollment for which such assistance was awarded; multiplied by (ii) the percentage of grant and loan assistance awarded under this title that has not been earned by the student, as described in subsection (a)(3)(C)(i).
(2) RESPONSIBILITY OF THE STUDENT.— (A) IN GENERAL.—The student shall return assistance that has not been earned by the student as described in subsection (a)(3)(C)(ii) in the order specified in paragraph (3) minus the amount the institution is required to return under paragraph (1).
(B) SPECIAL RULE.—The student (or parent in the case of funds due to a loan borrowed by a parent under part B or D) shall return or repay, as appropriate, the amount de- termined under subparagraph (A) to— (i) a loan program under this title in accordance with the terms of the loan; and September 8, 2023 As Amended Through P.L.
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484B HIGHER EDUCATION ACT OF 1965 652 (ii) a grant program under this title, as an over- payment of such grant and shall be subject to— (I) repayment arrangements satisfactory to the institution; or (II) overpayment collection procedures pre- scribed by the Secretary.
(C) GRANT OVERPAYMENT REQUIREMENTS.— (i) IN GENERAL.—Notwithstanding subparagraphs (A) and (B), a student shall only be required to return grant assistance in the amount (if any) by which— (I) the amount to be returned by the student (as determined under subparagraphs (A) and (B)), exceeds (II) 50 percent of the total grant assistance re- ceived by the student under this title for the pay- ment period or period of enrollment.

(ii) MINIMUM.—A student shall not be required to return amounts of $50 or less.
(D) WAIVERS OF FEDERAL PELL GRANT REPAYMENT BY STUDENTS AFFECTED BY DISASTERS.—The Secretary may waive the amounts that students are required to return under this section with respect to Federal Pell Grants if the withdrawals on which the returns are based are with- drawals by students— (i) who were residing in, employed in, or attending an institution of higher education that is located in an area in which the President has declared that a major disaster exists, in accordance with section 401 of the Robert T. Stafford Disaster Relief and Emergency As- sistance Act (42 U.S.C.
5170); (ii) whose attendance was interrupted because of the impact of the disaster on the student or the insti- tution; and (iii) whose withdrawal ended within the academic year during which the designation occurred or during the next succeeding academic year.
(E) WAIVERS OF GRANT ASSISTANCE REPAYMENT BY STU- DENTS AFFECTED BY DISASTERS.—In addition to the waivers authorized by subparagraph (D), the Secretary may waive the amounts that students are required to return under this section with respect to any other grant assistance under this title if the withdrawals on which the returns are based are withdrawals by students— (i) who were residing in, employed in, or attending an institution of higher education that is located in an area in which the President has declared that a major disaster exists, in accordance with section 401 of the Robert T. Stafford Disaster Relief and Emergency As- sistance Act (42 U.S.C.
5170); (ii) whose attendance was interrupted because of the impact of the disaster on the student or the insti- tution; and September 8, 2023 As Amended Through P.L.

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484B (iii) whose withdrawal ended within the academic year during which the designation occurred or during the next succeeding academic year.
(3) ORDER OF RETURN OF TITLE IV FUNDS.— (A) IN GENERAL.—Excess funds returned by the insti- tution or the student, as appropriate, in accordance with paragraph (1) or (2), respectively, shall be credited to out- standing balances on loans made under this title to the student or on behalf of the student for the payment period or period of enrollment for which a return of funds is re- quired.
Such excess funds shall be credited in the following order: (i) To outstanding balances on loans made under section 428H for the payment period or period of en- rollment for which a return of funds is required.

(ii) To outstanding balances on loans made under section 428 for the payment period or period of enroll- ment for which a return of funds is required.
(iii) To outstanding balances on unsubsidized loans (other than parent loans) made under part D for the payment period or period of enrollment for which a return of funds is required.

(iv) To outstanding balances on subsidized loans made under part D for the payment period or period of enrollment for which a return of funds is required.

(v) To outstanding balances on loans made under part E for the payment period or period of enrollment for which a return of funds is required.
(vi) To outstanding balances on loans made under section 428B for the payment period or period of en- rollment for which a return of funds is required.

(vii) To outstanding balances on parent loans made under part D for the payment period or period of enrollment for which a return of funds is required.
(B) REMAINING EXCESSES.—If excess funds remain after repaying all outstanding loan amounts, the remain- ing excess shall be credited in the following order: (i) To awards under subpart 1 of part A for the payment period or period of enrollment for which a re- turn of funds is required.

(ii) To awards under subpart 3 of part A for the payment period or period of enrollment for which a re- turn of funds is required.

(iii) To other assistance awarded under this title for which a return of funds is required.
(c) WITHDRAWAL DATE.— (1) IN GENERAL.—In this section, the term ‘‘day the student withdrew’’— (A) is the date that the institution determines— (i) the student began the withdrawal process pre- scribed by the institution; (ii) the student otherwise provided official notifica- tion to the institution of the intent to withdraw; or September 8, 2023 As Amended Through P.L.
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484C HIGHER EDUCATION ACT OF 1965 654 (iii) in the case of a student who does not begin the withdrawal process or otherwise notify the institu- tion of the intent to withdraw, the date that is the mid-point of the payment period for which assistance under this title was disbursed or a later date docu- mented by the institution; or (B) for institutions required to take attendance, is de- termined by the institution from such attendance records.
(2) SPECIAL RULE.—Notwithstanding paragraph (1), if the institution determines that a student did not begin the with- drawal process, or otherwise notify the institution of the intent to withdraw, due to illness, accident, grievous personal loss, or other such circumstances beyond the student’s control, the in- stitution may determine the appropriate withdrawal date.
(d) PERCENTAGE OF THE PAYMENT PERIOD OR PERIOD OF EN- ROLLMENT COMPLETED.—For purposes of subsection (a)(3)(B), the percentage of the payment period or period of enrollment for which assistance was awarded that was completed, is determined— (1) in the case of a program that is measured in credit hours, by dividing the total number of calendar days com- prising the payment period or period of enrollment for which assistance is awarded into the number of calendar days com- pleted in that period as of the day the student withdrew; and (2) in the case of a program that is measured in clock hours, by dividing the total number of clock hours comprising the payment period or period of enrollment for which assist- ance is awarded into the number of clock hours scheduled to be completed by the student in that period as of the day the student withdrew.
(e) EFFECTIVE DATE.—The provisions of this section shall take effect 2 years after the date of enactment of the Higher Education Amendments of 1998.

An institution of higher education may choose to implement such provisions prior to that date.

SEC.

484C.

ø20 U.S.C.

1091c¿ READMISSION REQUIREMENTS FOR SERVICEMEMBERS.
(a) DEFINITION OF SERVICE IN THE UNIFORMED SERVICES.—In this section, the term ‘‘service in the uniformed services’’ means service (whether voluntary or involuntary) on active duty in the Armed Forces, including such service by a member of the National Guard or Reserve, for a period of more than 30 days under a call or order to active duty of more than 30 days.
(b) DISCRIMINATION AGAINST STUDENTS WHO SERVE IN THE UNIFORMED SERVICES PROHIBITED.—A person who is a member of, applies to be a member of, performs, has performed, applies to per- form, or has an obligation to perform, service in the uniformed services shall not be denied readmission to an institution of higher education on the basis of that membership, application for member- ship, performance of service, application for service, or obligation.
(c) READMISSION PROCEDURES.— (1) IN GENERAL.—Any student whose absence from an in- stitution of higher education is necessitated by reason of serv- ice in the uniformed services shall be entitled to readmission to the institution of higher education if— September 8, 2023 As Amended Through P.L.
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484C (A) the student (or an appropriate officer of the Armed Forces or official of the Department of Defense) gives ad- vance written or verbal notice of such service to the appro- priate official at the institution of higher education; (B) the cumulative length of the absence and of all previous absences from that institution of higher education by reason of service in the uniformed services does not ex- ceed five years; and (C) except as otherwise provided in this section, the student submits a notification of intent to reenroll in the institution of higher education in accordance with the pro- visions of paragraph (4).
(2) EXCEPTIONS.— (A) MILITARY NECESSITY.—No notice is required under paragraph (1)(A) if the giving of such notice is precluded by military necessity, such as— (i) a mission, operation, exercise, or requirement that is classified; or (ii) a pending or ongoing mission, operation, exer- cise, or requirement that may be compromised or oth- erwise adversely affected by public knowledge.
(B) FAILURE TO GIVE ADVANCE NOTICE.—Any student (or an appropriate officer of the Armed Forces or official of the Department of Defense) who did not give advance writ- ten or verbal notice of service to the appropriate official at the institution of higher education in accordance with paragraph (1)(A) may meet the notice requirement by sub- mitting, at the time the student seeks readmission, an at- testation to the student’s institution of higher education that the student performed service in the uniformed serv- ices that necessitated the student’s absence from the insti- tution of higher education.
(3) APPLICABILITY.—This section shall apply to a student who is absent from an institution of higher education by reason of service in the uniformed services if such student’s cumu- lative period of service in the Armed Forces (including the Na- tional Guard or Reserve), with respect to the institution of higher education for which a student seeks readmission, does not exceed five years, except that any such period of service shall not include any service— (A) that is required, beyond five years, to complete an initial period of obligated service; (B) during which such student was unable to obtain orders releasing such student from a period of service in the uniformed services before the expiration of such five- year period and such inability was through no fault of such student; or (C) performed by a member of the Armed Forces (in- cluding the National Guard and Reserves) who is— (i) ordered to or retained on active duty under sec- tion 688, 12301(a), 12301(g), 12302, 12304, or 12305 of title 10, United States Code, or under section 251, 252, 359, 360, 367, or 712 of title 14, United States Code; September 8, 2023 As Amended Through P.L.
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484C HIGHER EDUCATION ACT OF 1965 656 (ii) ordered to or retained on active duty (other than for training) under any provision of law because of a war or national emergency declared by the Presi- dent or the Congress, as determined by the Secretary concerned; (iii) ordered to active duty (other than for train- ing) in support, as determined by the Secretary con- cerned, of an operational mission for which personnel have been ordered to active duty under section 12304 of title 10, United States Code; (iv) ordered to active duty in support, as deter- mined by the Secretary concerned, of a critical mission or requirement of the Armed Forces (including the Na- tional Guard or Reserve); or (v) called into Federal service as a member of the National Guard under chapter 13 of title 10, United States Code, or section 12406 of title 10, United States Code.
(4) NOTIFICATION OF INTENT TO RETURN.— (A) IN GENERAL.—Except as provided in subparagraph (B), a student referred to in subsection (a) shall, upon the completion of a period of service in the uniformed services, notify the institution of higher education of the student’s intent to return to the institution not later than three years after the completion of the period of service.
(B) HOSPITALIZATION OR CONVALESCENCE.—A student who is hospitalized for or convalescing from an illness or injury incurred in or aggravated during the performance of service in the uniformed services shall notify the institu- tion of higher education of the student’s intent to return to the institution not later than two years after the end of the period that is necessary for recovery from such illness or injury.
(C) SPECIAL RULE.—A student who fails to apply for readmission within the period described in this section shall not automatically forfeit such eligibility for readmis- sion to the institution of higher education, but shall be subject to the institution of higher education’s established leave of absence policy and general practices.
(5) DOCUMENTATION.— (A) IN GENERAL.—A student who submits an applica- tion for readmission to an institution of higher education under this section shall provide to the institution of higher education documentation to establish that— (i) the student has not exceeded the service limita- tions established under this section; and (ii) the student’s eligibility for readmission has not been terminated due to an exception in subsection (d).
(B) PROHIBITED DOCUMENTATION DEMANDS.—An insti- tution of higher education may not delay or attempt to avoid a readmission of a student under this section by de- manding documentation that does not exist, or is not read- ily available, at the time of readmission.

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485 (6) NO CHANGE IN ACADEMIC STATUS.—A student who is re- admitted to an institution of higher education under this sec- tion shall be readmitted with the same academic status as such student had when such student last attended the institu- tion of higher education.
(d) EXCEPTION FROM READMISSION ELIGIBILITY.—A student’s eligibility for readmission to an institution of higher education under this section by reason of such student’s service in the uni- formed services terminates upon the occurrence of any of the fol- lowing events: (1) A separation of such person from the Armed Forces (in- cluding the National Guard and Reserves) with a dishonorable or bad conduct discharge.

(2) A dismissal of such person permitted under section 1161(a) of title 10, United States Code.
(3) A dropping of such person from the rolls pursuant to section 1161(b) of title 10, United States Code.

SEC.

485. ø20 U.S.C.

1092¿ INSTITUTIONAL AND FINANCIAL ASSISTANCE INFORMATION FOR STUDENTS.
(a) INFORMATION DISSEMINATION ACTIVITIES.—(1) Each eligible institution participating in any program under this title shall carry out information dissemination activities for prospective and en- rolled students (including those attending or planning to attend less than full time) regarding the institution and all financial as- sistance under this title.
The information required by this section shall be produced and be made readily available upon request, through appropriate publications, mailings, and electronic media, to an enrolled student and to any prospective student.
Each eligible institution shall, on an annual basis, provide to all enrolled stu- dents a list of the information that is required to be provided by institutions to students by this section and section 444 of the Gen- eral Education Provisions Act (commonly known as the ‘‘Family Educational Rights and Privacy Act of 1974’’), together with a statement of the procedures required to obtain such information.
The information required by this section shall accurately describe— (A) the student financial assistance programs available to students who enroll at such institution; (B) the methods by which such assistance is distributed among student recipients who enroll at such institution; (C) any means, including forms, by which application for student financial assistance is made and requirements for ac- curately preparing such application; (D) the rights and responsibilities of students receiving fi- nancial assistance under this title; (E) the cost of attending the institution, including (i) tui- tion and fees, (ii) books and supplies, (iii) estimates of typical student room and board costs or typical commuting costs, and (iv) any additional cost of the program in which the student is enrolled or expresses a specific interest; (F) a statement of— (i) the requirements of any refund policy with which the institution is required to comply; (ii) the requirements under section 484B for the return of grant or loan assistance provided under this title; and September 8, 2023 As Amended Through P.L.
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485 HIGHER EDUCATION ACT OF 1965 658 (iii) the requirements for officially withdrawing from the institution; (G) the academic program of the institution, including (i) the current degree programs and other educational and train- ing programs, (ii) the instructional, laboratory, and other phys- ical plant facilities which relate to the academic program, (iii) the faculty and other instructional personnel, and (iv) any plans by the institution for improving the academic program of the institution; (H) each person designated under subsection (c) of this sec- tion, and the methods by which and locations in which any person so designated may be contacted by students and pro- spective students who are seeking information required by this subsection; (I) special facilities and services available to students with disabilities; (J) the names of associations, agencies, or governmental bodies which accredit, approve, or license the institution and its programs, and the procedures under which any current or prospective student may obtain or review upon request a copy of the documents describing the institution’s accreditation, ap- proval, or licensing; (K) the standards which the student must maintain in order to be considered to be making satisfactory progress, pur- suant to section 484(a)(2); (L) the completion or graduation rate of certificate- or de- gree-seeking, full-time, undergraduate 59 students entering such institutions; (M) 60 the terms and conditions of the loans that stu- dents receive under parts B, D, and E; (N) that enrollment in a program of study abroad approved for credit by the home institution may be considered enroll- ment in the home institution for purposes of applying for Fed- eral student financial assistance; (O) the campus crime report prepared by the institution pursuant to subsection (f), including all required reporting cat- egories; (P) 61 institutional policies and sanctions related to copyright infringement, including— (i) an annual disclosure that explicitly informs students that unauthorized distribution of copyrighted material, file sharing, may subject the students to civil and criminal liabilities; including unauthorized peer-to-peer (ii) a summary of the penalties for violation of Federal copyright laws; and (iii) a description of the institution’s policies with respect to unauthorized peer-to-peer file sharing, in- cluding disciplinary actions that are taken against stu- 59 Amendment made by sec.
10(a) of P.L.

102–26, 105 Stat.

128, inserted ‘‘undergraduate’’ after ‘‘full–time’’ without specifying which location.

This compilation inserts it in only the first location.

60 Margin so in law.

61 Margins of subparagraphs (P) through (V) are so in law.

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485 dents who engage in unauthorized distribution of copyrighted materials using the institution’s informa- tion technology system; (Q) 61 student body diversity at the institution, includ- ing information on the percentage of enrolled, full-time students who— (i) are male; (ii) are female; (iii) receive a Federal Pell Grant; and (iv) are a self-identified member of a major racial or ethnic group; (R) 61 the placement in employment of, and types of employment obtained by, graduates of the institution’s de- gree or certificate programs, gathered from such sources as alumni surveys, student satisfaction surveys, the National Survey of Student Engagement, the Community College Survey of Student Engagement, State data systems, or other relevant sources; (S) 61 the types of graduate and professional education in which graduates of the institution’s four-year degree programs enrolled, gathered from such sources as alumni surveys, student satisfaction surveys, the National Survey of Student Engagement, State data systems, or other rel- evant sources; (T) 61 the fire safety report prepared by the institution pursuant to subsection (i); (U) 61 the retention rate of certificate- or degree-seek- ing, first-time, full-time, undergraduate students entering such institution; and (V) 61 institutional policies regarding vaccinations.
(2) For the purpose of this section, the term ‘‘prospective stu- dent’’ means any individual who has contacted an eligible institu- tion requesting information concerning admission to that institu- tion.
(3) In calculating the completion or graduation rate under sub- paragraph (L) of paragraph (1) of this subsection or under sub- section (e), a student shall be counted as a completion or gradua- tion if, within 150 percent of the normal time for completion of or graduation from the program, the student has completed or grad- uated from the program, or enrolled in any program of an eligible institution for which the prior program provides substantial prepa- ration.
The information required to be disclosed under such sub- paragraph— (A) shall be made available by July 1 each year to enrolled students and prospective students prior to the students enroll- ing or entering into any financial obligation; and (B) shall cover the one-year period ending on August 31 of the preceding year.
(4) 62 For purposes of this section, institutions may— (A) exclude from the information disclosed in accord- ance with subparagraph (L) of paragraph (1) the comple- tion or graduation rates of students who leave school to September 8, 2023 As Amended Through P.L.

117-286, Enacted December 27, 2022 62 Margin so in law.

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485 HIGHER EDUCATION ACT OF 1965 660 serve in the Armed Forces, on official church missions, or with a recognized foreign aid service of the Federal Gov- ernment; or (B) in cases where the students described in subpara- graph (A) represent 20 percent or more of the certificate- or degree-seeking, full-time, undergraduate students at the institution, recalculate the completion or graduation rates of such students by excluding from the calculation de- scribed in paragraph (3) the time period during which such students were not enrolled due to their service in the Armed Forces, on official church missions, or with a recog- nized foreign aid service of the Federal Government.
(5) The Secretary shall permit any institution of higher edu- cation that is a member of an athletic association or athletic con- ference that has voluntarily published completion or graduation rate data or has agreed to publish data that, in the opinion of the Secretary, is substantially comparable to the information required under this subsection, to use such data to satisfy the requirements of this subsection; and (6) Each institution may provide supplemental information to enrolled and prospective students showing the completion or grad- uation rate for students described in paragraph (4) or for students transferring into the institution or information showing the rate at which students transfer out of the institution.
(7)(A)(i) 63 Subject to clause (ii), the information dissemi- nated under paragraph (1)(L), or reported under subsection (e), shall be disaggregated by gender, by each major racial and eth- nic subgroup, by recipients of a Federal Pell Grant, by recipi- ents of a loan made under part B or D (other than a loan made under section 428H or a Federal Direct Unsubsidized Stafford Loan) who did not receive a Federal Pell Grant, and by recipi- ents of neither a Federal Pell Grant nor a loan made under part B or D (other than a loan made under section 428H or a Federal Direct Unsubsidized Stafford Loan), if the number of students in such subgroup or with such status is sufficient to yield statistically reliable information and reporting will not reveal personally identifiable information about an individual student.
If such number is not sufficient for such purposes, then the institution shall note that the institution enrolled too few of such students to so disclose or report with confidence and confidentiality.

(ii) The requirements of clause (i) shall not apply to two- year, degree-granting institutions of higher education until academic year 2011-2012.
(B)(i) In order to assist two-year degree-granting institu- tions of higher education in meeting the requirements of para- graph (1)(L) and subsection (e), the Secretary, in consultation with the Commissioner for Education Statistics, shall, not later than 90 days after the date of enactment of the Higher Edu- cation Opportunity Act, convene a group of representatives from diverse institutions of higher education, experts in the field of higher education policy, state higher education officials, September 8, 2023 As Amended Through P.L.
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485 students, and other stakeholders in the higher education com- munity, to develop recommendations regarding the accurate calculation and reporting of the information required to be dis- seminated or reported under paragraph (1)(L) and subsection (e) by two-year, degree-granting institutions of higher edu- cation.
In developing such recommendations, the group of rep- resentatives shall consider the mission and role of two-year de- gree-granting institutions of higher education, and may rec- ommend additional or alternative measures of student success for such institutions in light of the mission and role of such in- stitutions.
(ii) The Secretary shall widely disseminate the rec- ommendations required under this subparagraph to two-year, degree-granting institutions of higher education, the public, and the authorizing committees not later than 18 months after the first meeting of the group of representatives convened under clause (i).
(iii) The Secretary shall use the recommendations from the group of representatives convened under clause (i) to provide technical assistance to two-year, degree-granting institutions of higher education in meeting the requirements of paragraph (1)(L) and subsection (e).
(iv) The Secretary may modify the information required to be disseminated or reported under paragraph (1)(L) or sub- section (e) by a two-year, degree-granting institution of higher education— (I) based on the recommendations received under this subparagraph from the group of representatives convened under clause (i); (II) to include additional or alternative measures of student success if the goals of the provisions of paragraph (1)(L) and subsection (e) can be met through additional means or comparable alternatives; and (III) during the period beginning on the date of enact- ment of the Higher Education Opportunity Act, and ending on June 30, 2011.
(b) EXIT COUNSELING FOR BORROWERS.—(1)(A) Each eligible in- stitution shall, through financial aid offices or otherwise, provide counseling to borrowers of loans that are made, insured, or guaran- teed under part B (other than loans made pursuant to section 428C or loans under section 428B made on behalf of a student) or made under part D (other than Federal Direct Consolidation Loans or Federal Direct PLUS Loans made on behalf of a student) or made under part E of this title prior to the completion of the course of study for which the borrower enrolled at the institution or at the time of departure from such institution.
The counseling required by this subsection shall include— (i) information on the repayment plans available, including a description of the different features of each plan and sample information showing the average anticipated monthly pay- ments, and the difference in interest paid and total payments, under each plan; (ii) debt management strategies that are designed to facili- tate the repayment of such indebtedness; September 8, 2023 As Amended Through P.L.
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485 HIGHER EDUCATION ACT OF 1965 662 (iii) an explanation that the borrower has the options to prepay each loan, pay each loan on a shorter schedule, and change repayment plans; (iv) for any loan forgiveness or cancellation provision of this title, a general description of the terms and conditions under which the borrower may obtain full or partial forgive- ness or cancellation of the principal and interest, and a copy of the information provided by the Secretary under section 485(d); (v) for any forbearance provision of this title, a general de- scription of the terms and conditions under which the borrower may defer repayment of principal or interest or be granted for- bearance, and a copy of the information provided by the Sec- retary under section 485(d); (vi) the consequences of defaulting on a loan, including ad- verse credit reports, delinquent debt collection procedures under Federal law, and litigation; (vii) information on the effects of using a consolidation loan under section 428C or a Federal Direct Consolidation Loan to discharge the borrower’s loans under parts B, D, and E, including at a minimum— (I) the effects of consolidation on total interest to be paid, fees to be paid, and length of repayment; (II) the effects of consolidation on a borrower’s under- lying loan benefits, including grace periods, loan forgive- ness, cancellation, and deferment opportunities; (III) the option of the borrower to prepay the loan or to change repayment plans; and (IV) that borrower benefit programs may vary among different lenders; (viii) a general description of the types of tax benefits that may be available to borrowers; 64 (ix) a notice to borrowers about the availability of the Na- tional Student Loan Data System and how the system can be used by a borrower to obtain information on the status of the borrower’s loans; and (x) 65 an explanation that— (I) the borrower may be contacted during the repayment period by third-party student debt re- lief companies; (II) the borrower should use caution when dealing with those companies; and (III) the services that those companies typi- cally provide are already offered to borrowers free 64 Section 3(1) of Public Law 116-251 amends section 485(b)(viii) by striking ‘‘and’’ after the semicolon.
According to section 6 of such law, this amendment will take effect on June 20, 2021.

Such amendment probably should have included a reference to paragraph (1)(A) of section 485(b); however, such amendment was carried out to reflect the probable intent of Congress.

65 Section 3(2) of Public Law 116–251 provides for an amendment to section 485(b) of this Act by adding at the end a new clause (x).
Section 6 of such Public Law provides: ‘‘This Act, and the amendments made by this Act, shall take effect on the date that is 180 days after the date of enactment of this Act’’ [effective date is June 20, 2021].

The placement of this new clause at the end of paragraph (1)(A) reflects the probable intent of Congress.

Also, the margin for such clause (x) (as added) does not conform with existing mar- gins.

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485 of charge through the Department or the bor- rower’s servicer; and (B) In the case of borrower who leaves an institution without the prior knowledge of the institution, the institution shall attempt to provide the information described in subparagraph (A) to the student in writing.
(2)(A) Each eligible institution shall require that the borrower of a loan made under part B, D, or E submit to the institution, dur- ing the exit interview required by this subsection— (i) the borrower’s expected permanent address after leav- ing the institution (regardless of the reason for leaving); (ii) the name and address of the borrower’s expected em- ployer after leaving the institution; (iii) the address of the borrower’s next of kin; and (iv) any corrections in the institution’s records relating the borrower’s name, address, social security number, references, and driver’s license number.
(B) The institution shall, within 60 days after the interview, forward any corrected or completed information received from the borrower to the guaranty agency indicated on the borrower’s stu- dent aid records.

(C) Nothing in this subsection shall be construed to prohibit an institution of higher education from utilizing electronic means to provide personalized exit counseling.
(c) FINANCIAL ASSISTANCE INFORMATION PERSONNEL.—Each el- igible institution shall designate an employee or group of employ- ees who shall be available on a full-time basis to assist students or potential students in obtaining information as specified in sub- section (a).
The Secretary may, by regulation, waive the require- ment that an employee or employees be available on a full-time basis for carrying out responsibilities required under this section whenever an institution in which the total enrollment, or the por- tion of the enrollment participating in programs under this title at that institution, is too small to necessitate such employee or em- ployees being available on a full-time basis.
No such waiver may include permission to exempt any such institution from designating a specific individual or a group of individuals to carry out the pro- visions of this section.
(d) DEPARTMENTAL PUBLICATION OF DESCRIPTIONS OF ASSIST- ANCE PROGRAMS.—(1) The Secretary shall make available to eligi- ble institutions, eligible lenders, and secondary schools descriptions of Federal student assistance programs including the rights and re- sponsibilities of student and institutional participants, in order to (A) assist students in gaining information through institutional sources, and (B) assist institutions in carrying out the provisions of this section, so that individual and institutional participants will be fully aware of their rights and responsibilities under such pro- grams.
In particular, such information shall include information to enable students and prospective students to assess the debt burden and monthly and total repayment obligations that will be incurred as a result of receiving loans of varying amounts under this title.

Such information shall also include information on the various pay- ment options available for student loans, including income-sen- sitive and income-based repayment plans for loans made, insured, September 8, 2023 As Amended Through P.L.
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485 HIGHER EDUCATION ACT OF 1965 664 or guaranteed under part B and income-contingent and income- based repayment plans for loans made under part D. In addition, such information shall include information to enable borrowers to assess the practical consequences of loan consolidation, including differences in deferment eligibility, interest rates, monthly pay- ments, and finance charges, and samples of loan consolidation pro- files to illustrate such consequences.
The Secretary shall provide information concerning the specific terms and conditions under which students may obtain partial or total cancellation or defer re- payment of loans for service, shall indicate (in terms of the Federal minimum wage) the maximum level of compensation and allow- ances that a student borrower may receive from a tax-exempt orga- nization to qualify for a deferment, and shall explicitly state that students may qualify for such partial cancellations or deferments when they serve as a paid employee of a tax-exempt organization.
The Secretary shall also provide information on loan forbearance, including the increase in debt that results from capitalization of in- terest.

Such information shall be provided by eligible institutions and eligible lenders at any time that information regarding loan availability is provided to any student.
(2) The Secretary, to the extent the information is available, shall compile information describing State and other prepaid tui- tion programs and savings programs and disseminate such infor- mation to States, eligible institutions, students, and parents in de- partmental publications.

(3) The Secretary, to the extent practicable, shall update the Department’s Internet site to include direct links to databases that contain information on public and private financial assistance pro- grams.
The Secretary shall only provide direct links to databases that can be accessed without charge and shall make reasonable ef- forts to verify that the databases included in a direct link are not providing fraudulent information.

The Secretary shall prominently display adjacent to any such direct link a disclaimer indicating that a direct link to a database does not constitute an endorsement or recommendation of the database, the provider of the database, or any services or products of such provider.
The Secretary shall pro- vide additional direct links to information resources from which students may obtain information about fraudulent and deceptive practices in the provision of services related to student financial aid.
(4) The Secretary shall widely publicize the location of the in- formation described in paragraph (1) among the public, eligible in- stitutions, and eligible lenders, and promote the use of such infor- mation by prospective students, enrolled students, families of pro- spective and enrolled students, and borrowers.
(e) DISCLOSURES REQUIRED WITH RESPECT TO ATHLETICALLY RELATED STUDENT AID.—(1) Each institution of higher education which participates in any program under this title and is attended by students receiving athletically related student aid shall annu- ally submit a report to the Secretary which contains— (A) the number of students at the institution of higher education who received athletically related student aid broken down by race and sex in the following sports: basketball, foot- September 8, 2023 As Amended Through P.L.
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485 ball, baseball, cross country/track, and all other sports com- bined; (B) the number of students at the institution of higher education, broken down by race and sex; (C) the completion or graduation rate for students at the institution of higher education who received athletically related student aid broken down by race and sex in the following sports: basketball, football, baseball, cross country/track and all other sports combined; (D) the completion or graduation rate for students at the institution of higher education, broken down by race and sex; (E) the average completion or graduation rate for the 4 most recent completing or graduating classes of students at the institution of higher education who received athletically related student aid broken down by race and sex in the following cat- egories: basketball, football, baseball, cross country/track, and all other sports combined; and (F) the average completion or graduation rate for the 4 most recent completing or graduating classes of students at the institution of higher education broken down by race and sex.
(2) When an institution described in paragraph (1) of this sub- section offers a potential student athlete athletically related stu- dent aid, such institution shall provide to the student and the stu- dent’s parents, guidance counselor, and coach the information con- tained in the report submitted by such institution pursuant to paragraph (1).
If the institution is a member of a national colle- giate athletic association that compiles graduation rate data on be- half of the association’s member institutions that the Secretary de- termines is substantially comparable to the information described in paragraph (1), the distribution of the compilation of such data to all secondary schools in the United States shall fulfill the re- sponsibility of the institution to provide information to a prospec- tive student athlete’s guidance counselor and coach.
(3) 66 For purposes of this subsection, institutions may— (A) exclude from the reporting requirements under paragraphs (1) and (2) the completion or graduation rates of students and student athletes who leave school to serve in the Armed Forces, on official church missions, or with a recognized foreign aid service of the Federal Govern- ment; or (B) in cases where the students described in subpara- graph (A) represent 20 percent or more of the certificate- or degree-seeking, full-time, undergraduate students at the institution, calculate the completion or graduation rates of such students by excluding from the calculations described in paragraph (1) the time period during which such stu- dents were not enrolled due to their service in the Armed Forces, on official church missions, or with a recognized foreign aid service of the Federal Government.
(4) Each institution of higher education described in paragraph (1) may provide supplemental information to students and the Sec- retary showing the completion or graduation rate when such com- September 8, 2023 As Amended Through P.L.

117-286, Enacted December 27, 2022 66 Margin so in law.

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485 HIGHER EDUCATION ACT OF 1965 666 pletion or graduation rate includes students transferring into and out of such institution.

(5) The Secretary, using the reports submitted under this sub- section, shall compile and publish a report containing the informa- tion required under paragraph (1) broken down by— (A) individual institutions of higher education; and (B) athletic conferences recognized by the National Colle- giate Athletic Association and the National Association of Intercollegiate Athletics.
(6) The Secretary shall waive the requirements of this sub- section for any institution of higher education that is a member of an athletic association or athletic conference that has voluntarily published completion or graduation rate data or has agreed to pub- lish data that, in the opinion of the Secretary, is substantially com- parable to the information required under this subsection.
(7) The Secretary, in conjunction with the National Junior Col- lege Athletic Association, shall develop and obtain data on comple- tion or graduation rates from two-year colleges that award athlet- ically related student aid.

Such data shall, to the extent prac- ticable, be consistent with the reporting requirements set forth in this section.
(8) For purposes of this subsection, the term ‘‘athletically re- lated student aid’’ means any scholarship, grant, or other form of financial assistance the terms of which require the recipient to par- ticipate in a program of intercollegiate athletics at an institution of higher education in order to be eligible to receive such assist- ance.

(9) The reports required by this subsection shall be due each July 1 and shall cover the 1-year period ending August 31 of the preceding year.
(f) DISCLOSURE OF CAMPUS SECURITY POLICY AND CAMPUS CRIME STATISTICS.—(1) Each eligible institution participating in any program under this title, other than a foreign institution of higher education, shall on August 1, 1991, begin to collect the fol- lowing information with respect to campus crime statistics and campus security policies of that institution, and beginning Sep- tember 1, 1992, and each year thereafter, prepare, publish, and dis- tribute, through appropriate publications or mailings, to all current students and employees, and to any applicant for enrollment or em- ployment upon request, an annual security report containing at least the following information with respect to the campus security policies and campus crime statistics of that institution: (A) A statement of current campus policies regarding pro- cedures and facilities for students and others to report criminal actions or other emergencies occurring on campus and policies concerning the institution’s response to such reports.
(B) A statement of current policies concerning security and access to campus facilities, including campus residences, and security considerations used in the maintenance of campus fa- cilities.

(C) A statement of current policies concerning campus law enforcement, including— September 8, 2023 As Amended Through P.L.
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485 (i) 67 the law enforcement authority of campus se- curity personnel; (ii) 67 the working relationship of campus security personnel with State and local law enforcement agen- cies, including whether the institution has agreements with such agencies, such as written memoranda of un- derstanding, for the investigation of alleged criminal offenses; and (iii) 67 policies which encourage accurate and prompt reporting of all crimes to the campus police and the appropriate law enforcement agencies, when the victim of such crime elects or is unable to make such a report.
(D) A description of the type and frequency of programs designed to inform students and employees about campus secu- rity procedures and practices and to encourage students and employees to be responsible for their own security and the se- curity of others.

(E) A description of programs designed to inform students and employees about the prevention of crimes.
(F) Statistics concerning the occurrence on campus, in or on noncampus buildings or property, and on public property during the most recent calendar year, and during the 2 pre- ceding calendar years for which data are available— (i) of the following criminal offenses reported to cam- pus security authorities or local police agencies: (I) murder; (II) sex offenses, forcible or nonforcible; (III) robbery; (IV) aggravated assault; (V) burglary; (VI) motor vehicle theft; (VII) manslaughter; (VIII) arson; (IX) arrests or persons referred for campus dis- ciplinary action for liquor law violations, drug-related violations, and weapons possession; and (ii) of the crimes described in subclauses (I) through (VIII) of clause (i), of larceny-theft, simple assault, intimi- dation, and destruction, damage, or vandalism of property, and of other crimes involving bodily injury to any person, in which the victim is intentionally selected because of the actual or perceived race, gender, religion, national origin, sexual orientation, gender identity,, 68 ethnicity, or dis- ability of the victim that are reported to campus security authorities or local police agencies, which data shall be col- lected and reported according to category of prejudice; and (iii) 69 of domestic violence, dating violence, and stalking incidents that were reported to campus secu- rity authorities or local police agencies.
67 Margin so in law.

68 So in law.

See section 304(a)(1)(B)(ii)(I) of Public Law 113–4.

69 Margin so in law.

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485 HIGHER EDUCATION ACT OF 1965 668 (G) A statement of policy concerning the monitoring and recording through local police agencies of criminal activity at off-campus student organizations which are recognized by the institution and that are engaged in by students attending the institution, including those student organizations with off-cam- pus housing facilities.
(H) A statement of policy regarding the possession, use, and sale of alcoholic beverages and enforcement of State under- age drinking laws and a statement of policy regarding the pos- session, use, and sale of illegal drugs and enforcement of Fed- eral and State drug laws and a description of any drug or alco- hol abuse education programs as required under section 120 of this Act.
(I) A statement advising the campus community where law enforcement agency information provided by a State under sec- tion 170101(j) of the Violent Crime Control and Law Enforce- ment Act of 1994 (42 U.S.C.

14071(j)), concerning registered sex offenders may be obtained, such as the law enforcement of- fice of the institution, a local law enforcement agency with ju- risdiction for the campus, or a computer network address.
(J) 70 A statement of current campus policies regarding immediate emergency response and evacuation procedures, including the use of electronic and cellular communication (if appropriate), which policies shall include procedures to— (i) immediately notify the campus community upon the confirmation of a significant emergency or dangerous situation involving an immediate threat to the health or safety of students or staff occurring on the campus, as defined in paragraph (6), unless issuing a notification will compromise efforts to con- tain the emergency; (ii) publicize emergency response and evacuation procedures on an annual basis in a manner designed to reach students and staff; and (iii) test emergency response and evacuation pro- cedures on an annual basis.
(2) Nothing in this subsection shall be construed to authorize the Secretary to require particular policies, procedures, or practices by institutions of higher education with respect to campus crimes or campus security.
(3) Each institution participating in any program under this title, other than a foreign institution of higher education, shall make timely reports to the campus community on crimes consid- ered to be a threat to other students and employees described in paragraph (1)(F) that are reported to campus security or local law police agencies.
Such reports shall be provided to students and em- ployees in a manner that is timely, that withholds the names of victims as confidential, and that will aid in the prevention of simi- lar occurrences.

(4)(A) Each institution participating in any program under this title, other than a foreign institution of higher education, that September 8, 2023 As Amended Through P.L.

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485 maintains a police or security department of any kind shall make, keep, and maintain a daily log, written in a form that can be easily understood, recording all crimes reported to such police or security department, including— (i) the nature, date, time, and general location of each crime; and (ii) the disposition of the complaint, if known.
(B)(i) All entries that are required pursuant to this paragraph shall, except where disclosure of such information is prohibited by law or such disclosure would jeopardize the confidentiality of the victim, be open to public inspection within two business days of the initial report being made to the department or a campus security authority.
(ii) If new information about an entry into a log becomes avail- able to a police or security department, then the new information shall be recorded in the log not later than two business days after the information becomes available to the police or security depart- ment.
(iii) If there is clear and convincing evidence that the release of such information would jeopardize an ongoing criminal investiga- tion or the safety of an individual, cause a suspect to flee or evade detection, or result in the destruction of evidence, such information may be withheld until that damage is no longer likely to occur from the release of such information.
(5) On an annual basis, each institution participating in any program under this title, other than a foreign institution of higher education, shall submit to the Secretary a copy of the statistics re- quired to be made available under paragraph (1)(F).
The Secretary shall— (A) review such statistics and report to the authorizing committees on campus crime statistics by September 1, 2000; (B) make copies of the statistics submitted to the Secretary available to the public; and (C) in coordination with representatives of institutions of higher education, identify exemplary campus security policies, procedures, and practices and disseminate information con- cerning those policies, procedures, and practices that have proven effective in the reduction of campus crime.
(6)(A) In this subsection: (i) The terms ‘‘dating violence’’, ‘‘domestic violence’’, and ‘‘stalking’’ have the meaning given such terms in section 40002(a) of the Violence Against Women Act of 1994 (42 U.S.C.

13925(a)).
(ii) The term ‘‘campus’’ means— (I) any building or property owned or controlled by an institution of higher education within the same reasonably contiguous geographic area of the institution and used by the institution in direct support of, or in a manner related to, the institution’s educational purposes, including resi- dence halls; and (II) property within the same reasonably contiguous geographic area of the institution that is owned by the in- stitution but controlled by another person, is used by stu- September 8, 2023 As Amended Through P.L.
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485 HIGHER EDUCATION ACT OF 1965 670 dents, and supports institutional purposes (such as a food or other retail vendor).
(iii) The term ‘‘noncampus building or property’’ means— (I) any building or property owned or controlled by a student organization recognized by the institution; and (II) any building or property (other than a branch campus) owned or controlled by an institution of higher education that is used in direct support of, or in relation to, the institution’s educational purposes, is used by stu- dents, and is not within the same reasonably contiguous geographic area of the institution.
(iv) The term ‘‘public property’’ means all public property that is within the same reasonably contiguous geographic area of the institution, such as a sidewalk, a street, other thorough- fare, or parking facility, and is adjacent to a facility owned or controlled by the institution if the facility is used by the insti- tution in direct support of, or in a manner related to the insti- tution’s educational purposes.
(v) The term ‘‘sexual assault’’ means an offense classified as a forcible or nonforcible sex offense under the uniform crime reporting system of the Federal Bureau of Investigation.
(B) In cases where branch campuses of an institution of higher education, schools within an institution of higher education, or ad- ministrative divisions within an institution are not within a rea- sonably contiguous geographic area, such entities shall be consid- ered separate campuses for purposes of the reporting requirements of this section.
(7) The statistics described in clauses (i) and (ii) of paragraph (1)(F) shall be compiled in accordance with the definitions used in the uniform crime reporting system of the Department of Justice, Federal Bureau of Investigation, and the modifications in such defi- nitions as implemented pursuant to the Hate Crime Statistics Act.
For the offenses of domestic violence, dating violence, and stalking, such statistics shall be compiled in accordance with the definitions used in section 40002(a) of the Violence Against Women Act of 1994 (42 U.S.C.

13925(a)).

Such statistics shall not identify victims of crimes or persons accused of crimes.
(8)(A) Each institution of higher education participating in any program under this title and title IV of the Economic Opportunity Act of 1964, other than a foreign institution of higher education, shall develop and distribute as part of the report described in para- graph (1) a statement of policy regarding— (i) such institution’s programs to prevent domestic vio- lence, dating violence, sexual assault, and stalking; and (ii) the procedures that such institution will follow once an incident of domestic violence, dating violence, sexual assault, or stalking has been reported, including a statement of the standard of evidence that will be used during any institutional conduct proceeding arising from such a report.
(B) The policy described in subparagraph (A) shall address the following areas: (i) Education programs to promote the awareness of rape, acquaintance rape, domestic violence, dating violence, sexual assault, and stalking, which shall include— September 8, 2023 As Amended Through P.L.
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485 (I) primary prevention and awareness programs for all incoming students and new employees, which shall in- clude— (aa) a statement that the institution of higher education prohibits the offenses of domestic violence, dating violence, sexual assault, and stalking; (bb) the definition of domestic violence, dating vio- lence, sexual assault, and stalking in the applicable ju- risdiction; (cc) the definition of consent, in reference to sex- ual activity, in the applicable jurisdiction; (dd) safe and positive options for bystander inter- vention that may be carried out by an individual to prevent harm or intervene when there is a risk of do- mestic violence, dating violence, sexual assault, or stalking against a person other than such individual; (ee) information on risk reduction to recognize warning signs of abusive behavior and how to avoid potential attacks; and in clauses (ii) information described (ff) the through (vii); and (II) ongoing prevention and awareness campaigns for students and faculty, including information described in items (aa) through (ff) of subclause (I).
(ii) Possible sanctions or protective measures that such in- stitution may impose following a final determination of an in- stitutional disciplinary procedure regarding rape, acquaintance rape, domestic violence, dating violence, sexual assault, or stalking.
(iii) Procedures victims should follow if a sex offense, do- mestic violence, dating violence, sexual assault, or stalking has occurred, including information in writing about— (I) the importance of preserving evidence as may be necessary to the proof of criminal domestic violence, dating violence, sexual assault, or stalking, or in obtaining a pro- tection order; (II) to whom the alleged offense should be reported; (III) options regarding law enforcement and campus authorities, including notification of the victim’s option to— (aa) notify proper law enforcement authorities, in- cluding on-campus and local police; (bb) be assisted by campus authorities in notifying law enforcement authorities if the victim so chooses; and (cc) decline to notify such authorities; and (IV) where applicable, the rights of victims and the in- stitution’s responsibilities regarding orders of protection, no contact orders, restraining orders, or similar lawful or- ders issued by a criminal, civil, or tribal court.
(iv) Procedures for institutional disciplinary action in cases of alleged domestic violence, dating violence, sexual assault, or stalking, which shall include a clear statement that— (I) such proceedings shall— September 8, 2023 As Amended Through P.L.

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485 HIGHER EDUCATION ACT OF 1965 672 (aa) provide a prompt, fair, and impartial inves- tigation and resolution; and (bb) be conducted by officials who receive annual training on the issues related to domestic violence, dating violence, sexual assault, and stalking and how to conduct an investigation and hearing process that protects the safety of victims and promotes account- ability; (II) the accuser and the accused are entitled to the same opportunities to have others present during an insti- tutional disciplinary proceeding, including the opportunity to be accompanied to any related meeting or proceeding by an advisor of their choice; and (III) both the accuser and the accused shall be simul- taneously informed, in writing, of— (aa) the outcome of any institutional disciplinary proceeding that arises from an allegation of domestic violence, dating violence, sexual assault, or stalking; (bb) the institution’s procedures for the accused and the victim to appeal the results of the institu- tional disciplinary proceeding; (cc) of any change to the results that occurs prior to the time that such results become final; and (dd) when such results become final.
(v) Information about how the institution will protect the confidentiality of victims, including how publicly-available rec- ordkeeping will be accomplished without the inclusion of iden- tifying information about the victim, to the extent permissible by law.

(vi) Written notification of students and employees about existing counseling, health, mental health, victim advocacy, legal assistance, and other services available for victims both on-campus and in the community.
(vii) Written notification of victims about options for, and available assistance in, changing academic, living, transpor- tation, and working situations, if so requested by the victim and if such accommodations are reasonably available, regard- less of whether the victim chooses to report the crime to cam- pus police or local law enforcement.
(C) A student or employee who reports to an institution of higher education that the student or employee has been a victim of domestic violence, dating violence, sexual assault, or stalking, whether the offense occurred on or off campus, shall be provided with a written explanation of the student or employee’s rights and options, as described in clauses (ii) through (vii) of subparagraph (B).
(9) The Secretary, in consultation with the Attorney General of the United States, shall provide technical assistance in complying with the provisions of this section to an institution of higher edu- cation who requests such assistance.

(10) Nothing in this section shall be construed to require the reporting or disclosure of privileged information.
(11) The Secretary shall report to the appropriate committees of Congress each institution of higher education that the Secretary September 8, 2023 As Amended Through P.L.

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485 determines is not in compliance with the reporting requirements of this subsection.
(12) For purposes of reporting the statistics with respect to crimes described in paragraph (1)(F), an institution of higher edu- cation shall distinguish, by means of separate categories, any criminal offenses that occur— (A) on campus; (B) in or on a noncampus building or property; (C) on public property; and (D) in dormitories or other residential facilities for stu- dents on campus.
(13) Upon a determination pursuant to section 487(c)(3)(B) that an institution of higher education has substantially misrepresented the number, location, or nature of the crimes required to be re- ported under this subsection, the Secretary shall impose a civil penalty upon the institution in the same amount and pursuant to the same procedures as a civil penalty is imposed under section 487(c)(3)(B).
(14)(A) Nothing in this subsection may be construed to— (i) create a cause of action against any institution of higher education or any employee of such an institution for any civil liability; or (ii) establish any standard of care.

(B) Notwithstanding any other provision of law, evidence re- garding compliance or noncompliance with this subsection shall not be admissible as evidence in any proceeding of any court, agency, board, or other entity, except with respect to an action to enforce this subsection.
(15) 71 The Secretary shall annually report to the author- izing committees regarding compliance with this subsection by institutions of higher education, including an up-to-date report on the Secretary’s monitoring of such compliance.

(16)(A) The Secretary shall seek the advice and counsel of the Attorney General of the United States concerning the development, and dissemination to institutions of higher education, of best prac- tices information about campus safety and emergencies.
(B) The Secretary shall seek the advice and counsel of the At- torney General of the United States and the Secretary of Health and Human Services concerning the development, and dissemina- tion to institutions of higher education, of best practices informa- tion about preventing and responding to incidents of domestic vio- lence, dating violence, sexual assault, and stalking, including ele- ments of institutional policies that have proven successful based on evidence-based outcome measurements.
(17) No officer, employee, or agent of an institution partici- pating in any program under this title shall retaliate, intimidate, threaten, coerce, or otherwise discriminate against any individual for exercising their rights or responsibilities under any provision of this subsection.

(18) This subsection may be cited as the ‘‘Jeanne Clery Disclo- sure of Campus Security Policy and Campus Crime Statistics Act’’.

(g) DATA REQUIRED.— 71 Margin so in law.

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485 HIGHER EDUCATION ACT OF 1965 674 (1) IN GENERAL.—Each coeducational institution of higher education that participates in any program under this title, and has an intercollegiate athletic program, shall annually, for the immediately preceding academic year, prepare a report that contains the following information regarding intercolle- giate athletics: (A) The number of male and female full-time under- graduates that attended the institution.
(B) A listing of the varsity teams that competed in intercollegiate athletic competition and for each such team the following data: (i) The total number of participants, by team, as of the day of the first scheduled contest for the team.
(ii) Total operating expenses attributable to such teams, except that an institution may also report such expenses on a per capita basis for each team and ex- penditures attributable to closely related teams such as track and field or swimming and diving, may be re- ported together, although such combinations shall be reported separately for men’s and women’s teams.

(iii) Whether the head coach is male or female and whether the head coach is assigned to that team on a full-time or part-time basis.
Graduate assistants and volunteers who serve as head coaches shall be consid- ered to be head coaches for the purposes of this clause.

(iv) The number of assistant coaches who are male and the number of assistant coaches who are female for each team and whether a particular coach is as- signed to that team on a full-time or part-time basis.

Graduate assistants and volunteers who serve as as- sistant coaches shall be considered to be assistant coaches for the purposes of this clause.
(C) The total amount of money spent on athletically related student aid, including the value of waivers of edu- cational expenses, separately for men’s and women’s teams overall.

(D) The ratio of athletically related student aid award- ed male athletes to athletically related student aid award- ed female athletes.

(E) The total amount of expenditures on recruiting, separately for men’s and women’s teams overall.
(F) The total annual revenues generated across all men’s teams and across all women’s teams, except that an institution may also report such revenues by individual team.

(G) The average annual institutional salary of the head coaches of men’s teams, across all offered sports, and the average annual institutional salary of the head coaches of women’s teams, across all offered sports.
(H) The average annual institutional salary of the as- sistant coaches of men’s teams, across all offered sports, and the average annual institutional salary of the assist- ant coaches of women’s teams, across all offered sports.

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485 (I)(i) The total revenues, and the revenues from foot- ball, men’s basketball, women’s basketball, all other men’s sports combined and all other women’s sports combined, derived by the institution from the institution’s intercolle- giate athletics activities.
(ii) For the purpose of clause (i), revenues from inter- collegiate athletics activities allocable to a sport shall in- clude (without limitation) gate receipts, broadcast reve- nues, appearance guarantees and options, concessions, and advertising, but revenues such as student activities fees or alumni contributions not so allocable shall be included in the calculation of total revenues only.
(J)(i) The total expenses, and the expenses attrib- utable to football, men’s basketball, women’s basketball, all other men’s sports combined, and all other women’s sports combined, made by the institution for the institu- tion’s intercollegiate athletics activities.
(ii) For the purpose of clause (i), expenses for inter- collegiate athletics activities allocable to a sport shall in- clude (without limitation) grants-in-aid, salaries, travel, equipment, and supplies, but expenses such as general and administrative overhead not so allocable shall be included in the calculation of total expenses only.
(2) SPECIAL RULE.—For the purposes of paragraph (1)(G), if a coach has responsibilities for more than one team and the institution does not allocate such coach’s salary by team, the institution should divide the salary by the number of teams for which the coach has responsibility and allocate the salary among the teams on a basis consistent with the coach’s respon- sibilities for the different teams.
(3) DISCLOSURE OF INFORMATION TO STUDENTS AND PUB- LIC.—An institution of higher education described in paragraph (1) shall make available to students and potential students, upon request, and to the public, the information contained in the report described in paragraph (1), except that all students shall be informed of their right to request such information.
(4) SUBMISSION; REPORT; INFORMATION AVAILABILITY.—(A) On an annual basis, each institution of higher education de- scribed in paragraph (1) shall provide to the Secretary, within 15 days of the date that the institution makes available the re- port under paragraph (1), the information contained in the re- port.

(B) The Secretary shall ensure that the reports described in subparagraph (A) are made available to the public within a reasonable period of time.
(C) Not later than 180 days after the date of enactment of the Higher Education Amendments of 1998, the Secretary shall notify all secondary schools in all States regarding the avail- ability of the information made available under paragraph (1), and how such information may be accessed.

(5) DEFINITION.—For the purposes of this subsection, the term ‘‘operating expenses’’ means expenditures on lodging and meals, transportation, officials, uniforms and equipment.
(h) TRANSFER OF CREDIT POLICIES.— September 8, 2023 As Amended Through P.L.

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485 HIGHER EDUCATION ACT OF 1965 676 (1) DISCLOSURE.—Each institution of higher education par- ticipating in any program under this title shall publicly dis- close, in a readable and comprehensible manner, the transfer of credit policies established by the institution which shall in- clude a statement of the institution’s current transfer of credit policies that includes, at a minimum— (A) any established criteria the institution uses re- garding the transfer of credit earned at another institution of higher education; and (B) a list of institutions of higher education with which the institution has established an articulation agreement.
(2) RULE OF CONSTRUCTION.—Nothing in this subsection shall be construed to— (A) authorize the Secretary or the National Advisory Committee on Institutional Quality and Integrity to re- quire particular policies, procedures, or practices by insti- tutions of higher education with respect to transfer of cred- it; (B) authorize an officer or employee of the Department to exercise any direction, supervision, or control over the curriculum, program of instruction, administration, or per- sonnel of any institution of higher education, or over any accrediting agency or association; (C) limit the application of the General Education Pro- visions Act; or (D) create any legally enforceable right on the part of a student to require an institution of higher education to accept a transfer of credit from another institution.
(i) DISCLOSURE OF FIRE SAFETY STANDARDS AND MEASURES.— (1) ANNUAL FIRE SAFETY REPORTS ON STUDENT HOUSING RE- QUIRED.—Each eligible institution participating in any pro- gram under this title that maintains on-campus student hous- ing facilities shall, on an annual basis, publish a fire safety re- port, which shall contain information with respect to the cam- pus fire safety practices and standards of that institution, in- cluding— (A) statistics concerning the following in each on-cam- pus student housing facility during the most recent cal- endar years for which data are available: (i) the number of fires and the cause of each fire; (ii) the number of injuries related to a fire that re- sult in treatment at a medical facility; (iii) the number of deaths related to a fire; and (iv) the value of property damage caused by a fire; (B) a description of each on-campus student housing facility fire safety system, including the fire sprinkler sys- tem; (C) the number of regular mandatory supervised fire drills; (D) policies or rules on portable electrical appliances, smoking, and open flames (such as candles), procedures for evacuation, and policies regarding fire safety education and training programs provided to students, faculty, and staff; and September 8, 2023 As Amended Through P.L.
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485 (E) plans for future improvements in fire safety, if de- termined necessary by such institution.
(2) REPORT TO THE SECRETARY.—Each institution described in paragraph (1) shall, on an annual basis, submit to the Sec- retary a copy of the statistics required to be made available under paragraph (1)(A).
(3) CURRENT INFORMATION TO CAMPUS COMMUNITY.—Each institution described in paragraph (1) shall— (A) make, keep, and maintain a log, recording all fires in on-campus student housing facilities, including the na- ture, date, time, and general location of each fire; and (B) make annual reports to the campus community on such fires.
(4) RESPONSIBILITIES OF THE SECRETARY.—The Secretary shall— (A) make the statistics submitted under paragraph (1)(A) to the Secretary available to the public; and (B) in coordination with nationally recognized fire or- ganizations and representatives of institutions of higher education, representatives of associations of institutions of higher education, and other organizations that represent and house a significant number of students— (i) identify exemplary fire safety policies, proce- dures, programs, and practices, including the installa- tion, to the technical standards of the National Fire Protection Association, of fire detection, prevention, and protection technologies in student housing, dor- mitories, and other buildings; (ii) disseminate the exemplary policies, proce- dures, programs and practices described in clause (i) to the Administrator of the United States Fire Admin- istration; (iii) make available to the public information con- cerning those policies, procedures, programs, and prac- tices that have proven effective in the reduction of fires; and (iv) develop a protocol for institutions to review the status of their fire safety systems.
(5) RULES OF CONSTRUCTION.—Nothing in this subsection shall be construed to— (A) authorize the Secretary to require particular poli- cies, procedures, programs, or practices by institutions of higher education with respect to fire safety, other than with respect to the collection, reporting, and dissemination of information required by this subsection; (B) affect section 444 of the General Education Provi- sions Act (commonly known as the ‘‘Family Educational Rights and Privacy Act of 1974’’) or the regulations issued under section 264 of the Health Insurance Portability and Accountability Act of 1996 (42 U.S.C.
1320d–2 note); (C) create a cause of action against any institution of higher education or any employee of such an institution for any civil liability; or (D) establish any standard of care.

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485 HIGHER EDUCATION ACT OF 1965 678 (6) COMPLIANCE REPORT.—The Secretary shall annually re- port to the authorizing committees regarding compliance with this subsection by institutions of higher education, including an up-to-date report on the Secretary’s monitoring of such com- pliance.
(7) EVIDENCE.—Notwithstanding any other provision of law, evidence regarding compliance or noncompliance with this subsection shall not be admissible as evidence in any pro- ceeding of any court, agency, board, or other entity, except with respect to an action to enforce this subsection.
(j) MISSING PERSON PROCEDURES.— (1) OPTION AND PROCEDURES.—Each institution of higher education that provides on-campus housing and participates in any program under this title shall— (A) establish a missing student notification policy for students who reside in on-campus housing that— (i) informs each such student that such student has the option to identify an individual to be contacted by the institution not later than 24 hours after the time that the student is determined missing in accord- ance with official notification procedures established by the institution under subparagraph (B); (ii) provides each such student a means to register confidential contact information in the event that the student is determined to be missing for a period of more than 24 hours; (iii) advises each such student who is under 18 years of age, and not an emancipated individual, that the institution is required to notify a custodial parent or guardian not later 24 hours after the time that the student is determined to be missing in accordance with such procedures; (iv) informs each such residing student that the institution will notify the appropriate law enforcement agency not later than 24 hours after the time that the student is determined missing in accordance with such procedures; and (v) requires, if the campus security or law enforce- ment personnel has been notified and makes a deter- mination that a student who is the subject of a miss- ing person report has been missing for more than 24 hours and has not returned to the campus, the institu- tion to initiate the emergency contact procedures in accordance with the student’s designation; and (B) establish official notification procedures for a miss- ing student who resides in on-campus housing that— (i) includes procedures for official notification of appropriate individuals at the institution that such student has been missing for more than 24 hours; (ii) requires any official missing person report re- lating to such student be referred immediately to the institution’s police or campus security department; and September 8, 2023 As Amended Through P.L.
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485 (iii) if, on investigation of the official report, such department determines that the missing student has been missing for more than 24 hours, requires— (I) such department to contact the individual identified by such student under subparagraph (A)(i); (II) if such student is under 18 years of age, and not an emancipated individual, the institution to immediately contact the custodial parent or legal guardian of such student; and (III) if subclauses (I) or (II) do not apply to a student determined to be a missing person, inform the appropriate law enforcement agency.
(2) RULE OF CONSTRUCTION.—Nothing in this subsection shall be construed— (A) to provide a private right of action to any person to enforce any provision of this subsection; or (B) to create a cause of action against any institution of higher education or any employee of the institution for any civil liability.
(k) 72 NOTICE TO STUDENTS CONCERNING PENALTIES FOR DRUG VIOLATIONS.— (1) NOTICE UPON ENROLLMENT.—Each institution of higher education shall provide to each student, upon enrollment, a separate, clear, and conspicuous written notice that advises the student of the penalties under section 484(r).
(2) NOTICE AFTER LOSS OF ELIGIBILITY.—An institution of higher education shall provide in a timely manner to each stu- dent who has lost eligibility for any grant, loan, or work-study assistance under this title as a result of the penalties listed under section 484(r)(1) a separate, clear, and conspicuous writ- ten notice that notifies the student of the loss of eligibility and advises the student of the ways in which the student can re- gain eligibility under section 484(r)(2).
(l) ENTRANCE COUNSELING FOR BORROWERS.— (1) DISCLOSURE REQUIRED PRIOR TO DISBURSEMENT.— (A) IN GENERAL.—Each eligible institution shall, at or prior to the time of a disbursement to a first-time borrower of a loan made, insured, or guaranteed under part B (other than a loan made pursuant to section 428C or a loan made on behalf of a student pursuant to section 428B) or made under part D (other than a Federal Direct Consolidation Loan or a Federal Direct PLUS loan made on behalf of a student), ensure that the borrower receives comprehensive information on the terms and conditions of the loan and of the responsibilities the borrower has with respect to such loan in accordance with paragraph (2).
Such information— (i) shall be provided in a simple and understand- able manner; and (ii) may be provided— 72 Effective not later than July 1, 2023, subsection (n)(1)(C) of section 702 of division FF of Public Law 116-260 provides for an amendment to repeal subsection (k) of section 485.

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485 HIGHER EDUCATION ACT OF 1965 680 (I) during an entrance counseling session con- duction in person; (II) on a separate written form provided to the borrower that the borrower signs and returns to the institution; or (III) online, with the borrower acknowledging receipt of the information.
(B) USE OF INTERACTIVE PROGRAMS.—The Secretary shall encourage institutions to carry out the requirements of subparagraph (A) through the use of interactive pro- grams that test the borrower’s understanding of the terms and conditions of the borrower’s loans under part B or D, using simple and understandable language and clear for- matting.
(2) INFORMATION TO BE PROVIDED.—The information to be provided to the borrower under paragraph (1)(A) shall include the following: (A) To the extent practicable, the effect of accepting the loan to be disbursed on the eligibility of the borrower for other forms of student financial assistance.

(B) An explanation of the use of the master promissory note.

(C) Information on how interest accrues and is capital- ized during periods when the interest is not paid by either the borrower or the Secretary.
(D) In the case of a loan made under section 428B or 428H, a Federal Direct PLUS Loan, or a Federal Direct Unsubsidized Stafford Loan, the option of the borrower to pay the interest while the borrower is in school.

(E) The definition of half-time enrollment at the insti- tution, during regular terms and summer school, if appli- cable, and the consequences of not maintaining half-time enrollment.
(F) An explanation of the importance of contacting the appropriate offices at the institution of higher education if the borrower withdraws prior to completing the borrower’s program of study so that the institution can provide exit counseling, including information regarding the borrower’s repayment options and loan consolidation.
(G) Sample monthly repayment amounts based on— (i) a range of levels of indebtedness of— (I) borrowers of loans under section 428 or 428H; and (II) as appropriate, graduate borrowers of loans under section 428, 428B, or 428H; or (ii) the average cumulative indebtedness of other borrowers in the same program as the borrower at the same institution.
(H) The obligation of the borrower to repay the full amount of the loan, regardless of whether the borrower completes or does not complete the program in which the borrower is enrolled within the regular time for program completion.

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485A (I) The likely consequences of default on the loan, in- cluding adverse credit reports, delinquent debt collection procedures under Federal law, and litigation.
(J) Information on the National Student Loan Data System and how the borrower can access the borrower’s records.

(K) The name of and contact information for the indi- vidual the borrower may contact if the borrower has any questions about the borrower’s rights and responsibilities or the terms and conditions of the loan.
(m) DISCLOSURES OF REIMBURSEMENTS FOR SERVICE ON ADVI- SORY BOARDS.— (1) DISCLOSURE.—Each institution of higher education par- ticipating in any program under this title shall report, on an annual basis, to the Secretary, any reasonable expenses paid or provided under section 140(d) of the Truth in Lending Act to any employee who is employed in the financial aid office of the institution, or who otherwise has responsibilities with re- spect to education loans or other financial aid of the institu- tion.
Such reports shall include— (A) the amount for each specific instance of reasonable expenses paid or provided; (B) the name of the financial aid official, other em- ployee, or agent to whom the expenses were paid or pro- vided; (C) the dates of the activity for which the expenses were paid or provided; and (D) a brief description of the activity for which the ex- penses were paid or provided.
(2) REPORT TO CONGRESS.—The Secretary shall summarize the information received from institutions of higher education under paragraph (1) in a report and transmit such report an- nually to the authorizing committees.

SEC.

485A.

ø20 U.S.C.

1092a¿ COMBINED PAYMENT PLAN.

(a) ELIGIBILITY FOR PLAN.—Upon the request of the borrower, a lender described in subparagraph (A), (B), or (C) of section 428C(a)(1) of this Act, or an eligible lender as defined in section 719 of the Public Health Service Act (42 U.S.C.
292o) may, with re- spect to a consolidation loan made under section 428C of this Act (and section 439(o) of this Act as in effect prior to the enactment of section 428C) and loans guaranteed under under part A of title VII of the Public Health Service Act (42 U.S.C.

292 et seq.

), offer a combined payment plan under which the lender shall submit one bill to the borrower for the repayment of all such loans for the monthly or other similar period of repayment.
(b) APPLICABILITY OF OTHER REQUIREMENTS.—A lender offering a combined payment plan shall comply with all provisions of sec- tion 428C applicable to loans consolidated or to be consolidated and shall comply with all provisions of part A of title VII of the Public Health Service Act (42 U.S.C.

292 et seq.)
292 et seq.)

applicable to loans under that subpart which are made part of the combined payment plan, except that a lender offering a combined payment plan under this to section section may offer consolidation loans pursuant September 8, 2023 As Amended Through P.L.

117-286, Enacted December 27, 2022 HOLC G:\COMP\EDIII\HIGHER EDUCATION ACT OF 1965.XML Sec.
485A HIGHER EDUCATION ACT OF 1965 682 428C(b)(1)(A) if such lender holds any outstanding loan of a bor- rower which is selected for inclusion in a combined payment plan.
(c) LENDER ELIGIBILITY.—Such lender may offer a combined payment plan only if— (1) the lender holds an outstanding loan of that borrower which is selected by the borrower for incorporation into a com- bined payment plan pursuant to this section (including loans which are selected by the borrower for consolidation under this section); or (2) the borrower certifies that the borrower has sought and has been unable to obtain a combined payment plan from the holders of the outstanding loans of that borrower.
(d) BORROWER SELECTION OF COMPETING OFFERS.—In the case of multiple offers by lenders to administer a combined payment plan for a borrower, the borrower shall select from among them the lender to administer the combined payment plan including its loan consolidation component.

(e) EFFECT OF PLAN.—Upon selection of a lender to administer the combined payment plan, the lender may reissue any loan under part A of title VII of the Public Health Service Act (42 U.S.C.

292 et seq.)
selected by the borrower for incorporation in the combined payment plan which is not held by such lender and the proceeds of such reissued loan shall be paid by the lender to the holder or holders of the loans so selected to discharge the liability on such loans, if— (1) the lender selected to administer the combined pay- ment plan has determined to its satisfaction, in accordance with reasonable and prudent business practices, for each loan being reissued (A) that the loan is a legal, valid, and binding obligation of the borrower; (B) that each such loan was made and serviced in compliance with applicable laws and regula- tions; and (C) the insurance on such loan is in full force and effect; and (2) the loan being reissued was not in default (as defined in section 707(e)(3) of the Public Health Service Act) at the time the request for a combined payment plan is made.
(f) NOTES AND INSURANCE CERTIFICATES.—(1) Each loan re- issued under subsection (e) shall be evidenced by a note executed by the borrower.

The Secretary of Health and Human Services shall insure such loan under a certificate of comprehensive insur- ance with no insurance limit, but any such certificate shall only be issued to an authorized holder of loans insured under part A of title VII of the Public Health Service Act (42 U.S.C.

292 et seq.)

(including the Student Loan Marketing Association).
Such certifi- cates shall provide that all loans reissued under this section shall be fully insured against loss of principal and interest.

Any insur- ance issued with respect to loans reissued under this section shall be excluded from the limitation on maximum insurance authority set forth in section 710 of the Public Health Service Act.
Notwith- standing the provisions of section 729(a) of the Public Health Serv- ice Act, the reissued loan shall be made in an amount, including outstanding principal, capitalized interest, accrued unpaid interest not yet capitalized, and authorized late charges.

The proceeds of each such loan will be paid by the lender to the holder of the origi- September 8, 2023 As Amended Through P.L.
117-286, Enacted December 27, 2022 HOLC G:\COMP\EDIII\HIGHER EDUCATION ACT OF 1965.XML 683 HIGHER EDUCATION ACT OF 1965 Sec.

485B nal loan being reissued and the borrower’s obligation to that holder on that loan shall be discharged.
(2) Except as otherwise specifically provided for under the pro- visions of this section, the terms of any reissued loan shall be the same as the terms of the original loan.

The maximum repayment period for a loan reissued under this section shall not exceed the remainder of the period which would have been permitted on the original loan.

If the lender holds more than one loan insured under part A of title VII of the Public Health Service Act (42 U.S.C.

292 et seq.
292 et seq.

), the maximum repayment period for all such loans may ex- tend to the latest date permitted for any individual loan.

Any re- issued loan may be consolidated with any other Health Education Assistance Loan as provided in the Public Health Service Act, and, with the concurrence of the borrower, repayment of any such loans during any period may be made in amounts that are less than the interest that accrues on such loans during that period.