To provide relief to students, schools, and student borrowers affected by natural disaster.

Summary: Katrina College Student Relief Act - Amends the Higher Education Act of 1965 to authorize the Secretary of Education to waive certain requirements for repayment of federal student grant assistance by students if: (1) they were residing in, employed in, or attending an institution of higher education located in a major disaster area; (2) their attendance was interrupted because of the disaster's impact on them or the institution; and (3) their withdrawal ended within the academic year during which the major disaster designation occurred or during the next succeeding academic year.

Provides such students with deferments for certain student loan obligations for up to six months.

Directs the Secretary to recalculate the expected family contribution for such students.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Katrina College Student Relief 
Act''.

SEC. 2. WAIVERS OF STUDENT GRANT REPAYMENT BY STUDENTS AFFECTED BY 
              DISASTERS.

    Section 484B(b)(2) of the Higher Education Act of 1965 (20 U.S.C. 
1091b(b)(2)) is amended by adding at the end the following new 
subparagraph:
                    ``(D) Waivers of student 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 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, or were dependent students 
                        whose parent or parents were residing or 
                        employed 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 
                        Assistance Act (42 U.S.C. 5170);
                            ``(ii) whose attendance was interrupted 
                        because of the impact of the disaster on the 
                        student or the institution; and
                            ``(iii) whose withdrawal ended within the 
                        academic year during which the designation 
                        occurred or during the next succeeding academic 
                        year.''.

SEC. 3. STUDENT LOAN DEFERMENT.

    (a) Guaranteed Loans.--Section 428(b)(1)(M) of the Higher Education 
Act of 1965 (20 U.S.C. 1078(b)(1)(M)) is amended--
            (1) by striking ``or'' at the end of clause (ii);
            (2) by inserting ``or'' after the semicolon at the end of 
        clause (iii); and
            (3) by adding after clause (iii) the following new clause:
                            ``(iv) not in excess of 6 months in the 
                        case of a borrower--
                                    ``(I) who was attending an 
                                institution of higher education that is 
                                located in, or was employed or residing 
                                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 Assistance Act (42 U.S.C. 
                                5170); and
                                    ``(II) whose attendance, 
                                employment, or residence was 
                                interrupted because of the impact of 
                                the disaster;''.
    (b) Direct Loans.--Section 455(f)(2) of such Act (20 U.S.C. 
1087e(f)(2)) is amended--
            (1) by striking the period at the end of subparagraph (C) 
        and inserting ``; or''; and
            (2) by adding at the end the following new subparagraph:
                    ``(D) not in excess of 6 months in the case of a 
                borrower--
                            ``(i) who was attending an institution of 
                        higher education that is located in, or was 
                        employed or residing 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 Assistance Act (42 U.S.C. 5170); and
                            ``(ii) whose attendance, employment, or 
                        residence was interrupted because of the impact 
                        of the disaster;''.
    (c) Perkins Loans.--Section 464(c)(2)(A) of such Act (20 U.S.C. 
1087dd(c)(2)(A)) is amended--
            (1) by striking ``or'' at the end of clause (iii);
            (2) by inserting ``or'' after the semicolon at the end of 
        clause (iv); and
            (3) by inserting after clause (iv) the following new 
        clause:
            ``(v) not in excess of 6 months in the case of a borrower--
                    ``(I) who was attending an institution of higher 
                education that is located in, or was employed or 
                residing 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 Assistance Act (42 U.S.C. 5170); 
                and
                    ``(II) whose attendance, employment, or residence 
                was interrupted because of the impact of the 
                disaster;''.

SEC. 4. EXPECTED FAMILY CONTRIBUTION.

    Section 474 of the Higher Education Act of 1965 (20 U.S.C. 1087nn) 
is amended by adding at the end the following new subsection:
    ``(c) Recalculation of EFC for Students Affected by Disasters.--The 
Secretary shall provide for the recalculation of expected family 
contribution for the current academic year, when possible, and for the 
ensuing academic year, for any student--
            ``(1) who resides in, is employed in, or is attending an 
        institution of higher education that is located in, or is a 
        dependent student whose parent or parents reside or are 
        employed 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 Assistance Act 
        (42 U.S.C. 5170); and
            ``(2) whose income or assets, or whose family income or 
        assets, are affected by such disaster.''.