A bill to provide grants to promote financial literacy.

Summary: Financial Literacy Improvement Act of 2008 - Amends the Elementary and Secondary Education Act of 1965 to direct the Secretary of Education to award formula matching grants to states or partnerships between states and experienced nonprofit providers of financial literacy or personal finance education programs.

Requires grantees to use 25% of the grant funds to: (1) develop financial literacy standards and assessments for at least three grade levels; (2) create teacher training programs to embed financial literacy or personal finance education into core academic subjects; and (3) evaluate the impact such education has on students' financial literacy.

Requires the remaining grant funds to be used for subgrants to local educational agencies (LEAs) or partnerships between LEAs and community organizations, local businesses, or other educational entities to implement such financial literacy activities, including student assessments and teacher training.

Amends the Higher Education Act of 1965 to direct the Secretary to award competitive grants to institutions of higher education (IHEs) or partnerships between IHEs and experienced nonprofit providers of financial literacy or personal finance education programs for activities that increase student knowledge in consumer, economic, and personal financial concepts.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Financial Literacy Improvement Act 
of 2008''.

SEC. 2. FINANCIAL LITERACY EDUCATION GRANTS.

    (a) In General.--Part D of title V of the Elementary and Secondary 
Education Act of 1965 (20 U.S.C. 7241 et seq.) is amended by inserting 
after section 5537 the following:

              ``Subpart 13A--Financial Literacy Education

``SEC. 5538. FINANCIAL LITERACY EDUCATION GRANTS.

    ``(a) Authorization.--The Secretary shall award grants to eligible 
entities to enable such entities--
            ``(1) to award subgrants to local entities to provide 
        financial literacy education; and
            ``(2) to carry out activities designed to promote financial 
        literacy education.
    ``(b) Eligible Entities.--In this section, the term `eligible 
entity' means--
            ``(1) a State educational agency; or
            ``(2) a State partnership consisting of--
                    ``(A) a State educational agency; and
                    ``(B) a nonprofit organization with experience and 
                a proven quality track record in financial literacy or 
                personal finance education programs.
    ``(c) Application.--An eligible entity that desires to receive 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.
    ``(d) Formula.--From the total amount appropriated under subsection 
(g) for a fiscal year, the Secretary shall allot to each State for such 
fiscal year an amount that bears the same relation to such total amount 
as the amount such State received under part A of title I for such 
fiscal year bears to the total amount received by all States under part 
A of title I for such fiscal year.
    ``(e) Use of Funds.--
            ``(1) Subgrants to eligible local entities.--
                    ``(A) Eligible local entity.--In this section, the 
                term `eligible local entity' means--
                            ``(i) a local educational agency; or
                            ``(ii) a local partnership consisting of--
                                    ``(I) a local educational agency; 
                                and
                                    ``(II) not less than 1 of the 
                                following:
                                            ``(aa) A nonprofit 
                                        organization with experience 
                                        and a proven track record in 
                                        quality financial literacy or 
                                        personal finance education 
                                        programs.
                                            ``(bb) An educational 
                                        service agency.
                                            ``(cc) A recipient of an 
                                        Excellence in Economic 
                                        Education grant under subpart 
                                        13.
                                            ``(dd) An institution of 
                                        higher education.
                                            ``(ee) A community 
                                        organization.
                                            ``(ff) A representative of 
                                        local business.
                    ``(B) Authorization of subgrants.--An eligible 
                entity that receives a grant under this section shall 
                use 75 percent of such grant funds to award subgrants 
                to eligible local entities.
                    ``(C) Applications.--
                            ``(i) In general.--An eligible local entity 
                        that desires to receive a subgrant under this 
                        paragraph shall submit an application to the 
                        eligible entity at such time, in such manner, 
                        and accompanied by such information as the 
                        eligible entity may require.
                            ``(ii) Review of applications.--The 
                        eligible entity shall review applications 
                        submitted under clause (i) in the same manner 
                        as applications are reviewed under section 
                        5534(b).
                    ``(D) Use of funds.--An eligible local entity that 
                receives a subgrant under this paragraph--
                            ``(i) shall use the subgrant funds to--
                                    ``(I) implement teacher training 
                                programs to embed financial literacy 
                                and personal finance education into 
                                core academic subjects;
                                    ``(II) administer financial 
                                literacy assessments on not less than 
                                an annual basis in, at a minimum, the 
                                grade levels selected by the State 
                                pursuant to paragraph (2)(A); and
                                    ``(III) implement financial 
                                literacy activities and sequences of 
                                study within core academic subjects; 
                                and
                            ``(ii) may use the subgrant funds to 
                        implement school-based activities, including 
                        after school activities, to enhance student 
                        understanding and experiential learning with 
                        consumer, economic, and personal finance 
                        concepts.
                    ``(E) Report.--An eligible local entity that 
                receives a subgrant under this paragraph shall include 
                in the annual report card under section 1111(h)(2) the 
                same information on student achievement on the 
                financial literacy assessments, administered pursuant 
                to subparagraph (D), as required, pursuant to section 
                1111(h)(2), of the other State academic assessments 
                described in section 1111(b)(3).
            ``(2) State activities.--An eligible entity that receives a 
        grant under this section shall use 25 percent of such grant 
        funds to carry out the following:
                    ``(A) The development of financial literacy 
                standards in not less than 3 grade levels, including 
                not less than 1 grade level in elementary school, not 
                less than 1 grade level in middle school, and not less 
                than 1 grade level in high school.
                    ``(B) The development of appropriate financial 
                literacy assessments in the grade levels determined 
                under subparagraph (A) that are valid, reliable, and 
                comparable across the State.
                    ``(C) Teacher professional development programs to 
                embed financial literacy or personal finance education 
                into core academic subjects.
                    ``(D) An evaluation of the impact of financial 
                literacy or personal finance education on students' 
                understanding of financial literacy concepts.
    ``(f) Matching Funds.--An eligible entity that receives a grant 
under this section shall provide, from non-Federal sources, an amount 
equal to 25 percent of the amount of the grant award to carry out 
activities required under this section.
    ``(g) Authorization of Appropriations.--There are authorized to be 
appropriated to carry out this section $125,000,000 for each of fiscal 
years 2009 through 2014.''.
    (b) Table of Contents.--The table of contents in section 2 of the 
Elementary and Secondary Education Act of 1965 is amended by inserting 
after the item relating to section 5537 the following:

              ``Subpart 13A--Financial Literacy Education

``Sec. 5538. Financial literacy education grants.''.

SEC. 3. GRANTS TO PROMOTE POSTSECONDARY FINANCIAL LITERACY.

    Part A of title III of the Higher Education Act of 1965 (20 U.S.C. 
1057 et seq.) is amended by adding at the end the following:

``SEC. 318. GRANTS TO PROMOTE POSTSECONDARY FINANCIAL LITERACY.

    ``(a) Authorization of Grant Awards.--The Secretary shall award 
grants, on a competitive basis, to eligible entities to enable such 
entities to provide financial literacy courses or course components to 
students.
    ``(b) Definition of Eligible Entity.--In this section, the term 
`eligible entity' means--
            ``(1) an institution of higher education; or
            ``(2) a partnership consisting of--
                    ``(A) an institution of higher education; and
                    ``(B) a nonprofit organization with experience and 
                a proven track record in quality financial literacy or 
                personal finance education programs.
    ``(c) Application.--An eligible entity that desires to receive 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.
    ``(d) Minimum Grant Amount.--The Secretary shall award grants under 
this section in amounts of not less than $500,000.
    ``(e) Use of Funds.--An eligible entity that receives a grant under 
this section shall use the grant funds to develop and implement 
financial literacy education, activities, student organizations, or 
counseling that increase student knowledge in consumer, economic, and 
personal financial concepts.
    ``(f) Authorization of Appropriations.--There are authorized to be 
appropriated to carry out this section $125,000,000 for each of the 
fiscal years 2009 through 2014.''.