Youth Financial Education Act

Summary: Youth Financial Education Act - Amends the Elementary and Secondary Education Act of 1965 to establish a new part L, Promoting Youth Financial Literacy, under title X (Programs of National Significance). 
Authorizes the Secretary of Education to provide grants to State educational agencies (SEAs) to develop and integrate youth financial education programs for students in elementary and secondary schools. 
Sets forth requirements for State plans and for allocation of grants to States. 
Requires States to use grants to: (1) provide funds to local educational agencies (LEAs) and public schools to carry out financial education programs for students in kindergarten through grade 12 based on the concept of achieving financial literacy through the teaching of personal financial management skills and the basic principles involved with earning, spending, saving, and investing; (2) carry out professional development programs to prepare teachers and administrators for financial education; and (3) monitor and evaluate programs. 
Directs the Secretary to make a grant to or contract with an entity with substantial financial education experience for a national clearinghouse for instructional materials and information on model financial education programs and best practices. 
Directs the Secretary to: (1) develop performance measures for the part L programs of State grants and of the clearinghouse; and (2) report to the Congress annually on the implementation of part L programs. 
Authorizes appropriations.

SECTION 1. PROMOTING YOUTH FINANCIAL LITERACY.

    Title X of the Elementary and Secondary Education Act of 1965 (20 
U.S.C. 8001 et seq.) is amended by adding at the end the following new 
part:

              ``PART L--PROMOTING YOUTH FINANCIAL LITERACY

``SEC. 10993. SHORT TITLE AND FINDINGS.

    ``(a) Short Title.--This part may be cited as the `Youth Financial 
Education Act'.
    ``(b) Findings.--Congress finds the following:
            ``(1) In order to succeed in our dynamic American economy, 
        young people must obtain the skills, knowledge, and experience 
        necessary to manage their personal finances and obtain general 
        financial literacy. All young adults should have the 
        educational tools necessary to make informed financial 
        decisions.
            ``(2) Despite the critical importance of financial literacy 
        to young people, the average student who graduates from high 
        school lacks basic skills in the management of personal 
        financial affairs. A nationwide survey conducted in 1997 by the 
        Jump$tart Coalition for Personal Financial Literacy examined 
        the financial knowledge of 1,509 12th graders. On average, 
        survey respondents answered only 57 percent of the questions 
        correctly, and only 5 percent of the respondents received a `C' 
        grade or better.
            ``(3) An evaluation by the National Endowment for Financial 
        Education High School Financial Planning Program undertaken 
        jointly with the United States Department of Agriculture 
        Cooperative State Research, Education, and Extension Service 
        demonstrates that as little as 10 hours of classroom 
        instruction can impart substantial knowledge and affect 
        significant change in how teens handle their money.
            ``(4) State educational leaders have recognized the 
        importance of providing a basic financial education to students 
        in grades kindergarten through 12 by integrating financial 
        education into State educational standards, but by 1999 only 14 
        States required schools to implement personal finance standards 
        into the academic curriculum.
            ``(5) Teacher training and professional development are 
        critical to achieving youth financial literacy. Teachers 
        confirm the need for professional development in personal 
        finance education. In a survey by the National Institute for 
        Consumer Education, 77 percent of a State's economics teachers 
        revealed that they had never had a college course in personal 
        finance.
            ``(6) Personal financial education helps prepare students 
        for the workforce and for financial independence by developing 
        their sense of individual responsibility, improving their life 
        skills, and providing them with a thorough understanding of 
        consumer economics that will benefit them for their entire 
        lives.
            ``(7) Financial education integrates instruction in 
        valuable life skills with instruction in economics, including 
        income and taxes, money management, investment and spending, 
        and the importance of personal savings.
            ``(8) The consumers and investors of tomorrow are in our 
        schools today. The teaching of personal finance should be 
        encouraged at all levels of our Nation's educational system, 
        from kindergarten through grade 12.

``SEC. 10994. STATE GRANT PROGRAM.

    ``(a) Program Authorized.--The Secretary is authorized to provide 
grants to State educational agencies to develop and integrate youth 
financial education programs for students in elementary and secondary 
schools.
    ``(b) State Plan.--
            ``(1) Approved state plan required.--To be eligible to 
        receive a grant under this section, a State shall submit an 
        application which includes a State plan, described in paragraph 
        (2), approved by the Secretary.
            ``(2) State plan contents.--The State plan referred to in 
        paragraph (1) shall include--
                    ``(A) a description of how the State will use grant 
                funds;
                    ``(B) a description of how the programs supported 
                by a grant will be coordinated with other relevant 
                Federal, State, regional, and local programs; and
                    ``(C) a description of how the State will evaluate 
                program performance.
    ``(c) Allocation of Funds.--
            ``(1) Allocation factors.--Except as otherwise provided in 
        paragraph (2), the Secretary shall allocate the amounts made 
        available to carry out this section pursuant to subsection (a) 
        to each State according to the relative populations in all the 
        States of students in grades kindergarten through 12, as 
        determined by the Secretary based on the most recent 
        satisfactory data.
            ``(2) Minimum allocation.--Subject to the availability of 
        appropriations and notwithstanding paragraph (1), a State that 
        has submitted an approved plan under subsection (b) shall be 
        allocated an amount not less than $500,000 for a fiscal year.
            ``(3) Reallocation.--In any fiscal year an allocation under 
        this subsection--
                    ``(A) for a State that has not submitted a plan 
                under subsection (b); or
                    ``(B) for a State whose plan submitted under 
                subsection (b) has been disapproved by the Secretary;
        shall be reallocated to States with approved plans under this 
        section in accordance with paragraph (1).
    ``(d) Use of Grant Funds.--
            ``(1) Required uses.--A grant made to a State under this 
        part shall be used--
                    ``(A) to provide funds to local educational 
                agencies and public schools to carry out financial 
                education programs for students in grades kindergarten 
                through 12 based on the concept of achieving financial 
                literacy through the teaching of personal financial 
                management skills and the basic principles involved 
                with earning, spending, saving, and investing;
                    ``(B) to carry out professional development 
                programs to prepare teachers and administrators for 
                financial education; and
                    ``(C) to monitor and evaluate programs supported 
                under subparagraphs (A) and (B).
            ``(2) Limitation on administrative costs.--A State 
        receiving a grant under subsection (a) may use not more than 4 
        percent of the total amount of the grant in each fiscal year 
        for the administrative costs of carrying out this section.
    ``(e) Report to the Secretary.--Each State educational agency 
receiving a grant under this section shall transmit a report to the 
Secretary with respect to each fiscal year for which a grant is 
received. The report shall describe the programs supported by the grant 
and the results of the State's monitoring and evaluation of such 
programs.

``SEC. 10995. CLEARINGHOUSE.

    ``(a) Authority.--Subject to the availability of appropriations, 
the Secretary shall make a grant to or execute a contract with an 
organization or institution with substantial experience in the field of 
financial education, such as the Jump$tart Coalition for Personal 
Financial Literacy, to establish, operate, and maintain a national 
clearinghouse (in this part referred to as the Clearinghouse) for 
instructional materials and information regarding model financial 
education programs and best practices.
    ``(b) Application.--An organization or institution desiring to 
establish, operate, and maintain the Clearinghouse shall submit an 
application to the Secretary at such time, in such manner, and 
accompanied by such information, as the Secretary may reasonably 
require.
    ``(c) Basis and Term.--The Secretary shall make the grant or 
contract authorized under subsection (a) on a competitive, merit basis 
for a term of 5 years.
    ``(d) Use of Funds.--The Clearinghouse shall use the funds provided 
under a grant or contract made under subsection (a)--
            ``(1) to maintain a repository of instructional materials 
        and related information regarding financial education programs 
        for elementary and secondary schools, including kindergartens, 
        for use by States, localities, and the general public;
            ``(2) to disseminate to States, localities, and the general 
        public, through electronic and other means, instructional 
        materials and related information regarding financial education 
        programs for elementary and secondary schools, including 
        kindergartens; and
            ``(3) to the extent that resources allow, to provide 
        technical assistance to States, localities, and the general 
        public on the design, establishment, and implementation of 
        financial education programs for elementary and secondary 
        schools, including kindergartens.
    ``(e) Consultation.--The chief executive officer of the 
organization selected to establish and operate the Clearinghouse shall 
consult with the Department of the  Treasury and the Securities 
Exchange Commission with respect to its activities under subsection 
(d).
    ``(f) Submission to Clearinghouse.--Each Federal agency or 
department that develops financial education programs and instructional 
materials for such programs shall submit to the Clearinghouse 
information on the programs and copies of the materials.
    ``(g) Application of Copyright Laws.--In carrying out this section 
the Clearinghouse shall comply with the provisions of title 17 of the 
United States Code.

``SEC. 10996. EVALUATION AND REPORT.

    ``(a) Performance Measures.--The Secretary shall develop measures 
to evaluate the performance of programs assisted under sections 10994 
and 10995.
    ``(b) Evaluation According to Performance Measures.--Applying the 
performance measures developed under subsection (a), the Secretary 
shall evaluate programs assisted under sections 10994 and 10995--
            ``(1) to judge their performance and effectiveness;
            ``(2) to identify which of the programs represent the best 
        practices of entities developing financial education programs 
        for students in grades kindergarten through 12; and
            ``(3) to identify which of the programs may be replicated 
        and used to provide technical assistance to States, localities, 
        and the general public.
    ``(c) Report.--For each fiscal year for which there are 
appropriations under section 10999(a), the Secretary shall transmit a 
report to the Congress describing the status of the implementation of 
this part. The report shall include the results of the evaluation 
required under subsection (b) and a description of the programs 
supported under section 10994.

``SEC. 10997. DEFINITIONS.

    ``In this part--
            ``(1) the term `financial education' means educational 
        activities and experiences, planned and supervised by qualified 
        teachers, that enable students to understand basic economic and 
        consumer principals, acquire the skills and knowledge necessary 
        to manage personal and household finances, and develop a range 
        of competencies that will enable them to become responsible 
        consumers in today's complex economy;
            ``(2) the terms `local educational agency', `State 
        educational agency', and `outlying area' have the meanings 
        given the terms in section 14101 of the Elementary and 
        Secondary Education Act of 1965;
            ``(3) the term `qualified teacher' means a teacher who 
        holds a valid teaching certification or is considered to be 
        qualified by the State educational agency in the State in which 
        the teacher works;
            ``(4) the term `Secretary' means the Secretary of 
        Education; and
            ``(5) the term `State' means each of the 50 States, the 
        District of Columbia, the Commonwealth of Puerto Rico, and each 
        outlying area.

``SEC. 10998. PROHIBITION.

    ``Nothing in this part shall be construed to authorize an officer 
or employee of the Federal Government to mandate, direct, or control a 
State, local educational agency, or school's specific instructional 
content, curriculum, or program of instruction, as a condition of 
eligibility to receive funds under this part.

``SEC. 10999. AUTHORIZATION OF APPROPRIATIONS.

    ``(a) Authorization.--For the purposes of carrying out this part, 
there are authorized to be appropriated $100,000,000 for each of the 
fiscal years 2000 through 2004.
    ``(b) Limitation on Funds for Clearinghouse.--The Secretary may use 
not less than 2 percent and not more than 5 percent of amounts 
appropriated under subsection (a) for each fiscal year to carry out 
section 10995.
    ``(c) Limitation on Funds for Secretary Evaluation.--The Secretary 
may use not more than $200,000 from the amounts appropriated under 
subsection (a) for each fiscal year to carry out subsections (a) and 
(b) of section 10996.
    ``(d) Limitation on Administrative Costs.--Except as necessary to 
carry out subsections (a) and (b) of section 10996 using amounts 
described in subsection (c) of this section, the Secretary shall not 
use any portion of the amounts appropriated under subsection (a) for 
the costs of administering this part.''.