A bill to amend title I of the Higher Education Act of 1965 regarding institution financial aid offer form requirements.

Summary: Amends the Higher Education Act of 1965 to direct the Secretary of Education to: (1) prepare a report for specified congressional committees on the adequacy of the financial aid offer forms issued by federally-assisted institutions of higher education (IHEs); and (2) develop model financial aid offer formats based on the report's findings.

Requires such formats to include, in a consumer-friendly manner, specified information regarding: (1) the student's total and net cost of attending the IHE; (2) available scholarships, loans, and work assistance; and (3) where to obtain additional information on the financial aid offered.

Directs each IHE to use one of the model formats as part of its financial aid offer form, and provide such form to current or prospective students and their parents in time for them to consider the format information before applying for or selecting an educational loan.

SECTION 1. INSTITUTION FINANCIAL AID OFFER FORM REQUIREMENTS.

    Title I of the Higher Education Act of 1965 (20 U.S.C. 1001 et 
seq.) is amended by adding at the end the following:

      ``PART E--INSTITUTION FINANCIAL AID OFFER FORM REQUIREMENTS

``SEC. 151. DEFINITIONS.

    ``In this part:
            ``(1) Adequacy.--The term `adequacy', with respect to a 
        financial aid offer form from a covered institution, means a 
        letter that provides parents and students with comprehensive 
        information on the postsecondary education costs and the terms 
        and conditions of financial aid offered so that the parents and 
        students can make informed educational loan borrowing 
        decisions.
            ``(2) Cost of attendance.--The term `cost of attendance' 
        has the meaning given the term in section 472.
            ``(3) Covered institution.--The term `covered institution' 
        means any educational institution that--
                    ``(A) offers a postsecondary educational degree, 
                certificate, or program of study (including any 
                institution of higher education, as such term is 
                defined in section 102); and
                    ``(B) receives any Federal funding or assistance.

``SEC. 152. INSTITUTION REQUIREMENTS RELATING TO FINANCIAL AID OFFER 
              FORMS.

    ``(a) Secretary Duties.--
            ``(1) Report and model formats.--Not later than October 1, 
        2009, the Secretary shall--
                    ``(A) prepare a report on the adequacy of the 
                financial aid offer forms provided by covered 
                institutions to students and the parents of such 
                students, after consulting with--
                            ``(i) students;
                            ``(ii) parents of students;
                            ``(iii) representatives of covered 
                        institutions (including financial aid 
                        administrators, registrars, and business 
                        officers); and
                            ``(iv) consumer groups that receive no 
                        commercial or covered institution support;
                    ``(B) include in the report model financial aid 
                offer formats for financial aid offer forms that--
                            ``(i) are based on the report's findings; 
                        and
                            ``(ii) include the information described in 
                        paragraph (2); and
                    ``(C)(i) submit the report and model formats to the 
                Committee on Health, Education, Labor, and Pensions of 
                the Senate and the Committee on Education and Labor of 
                the House of Representatives; and
                    ``(ii) make the report and model formats available 
                to covered institutions, lenders, and the public.
            ``(2) Model formats contents.--The model financial aid 
        offer formats developed under paragraph (1) shall present, in a 
        consumer-friendly manner, the following information:
                    ``(A) The student's total cost of attendance for 
                the year for which the covered institution is issuing 
                the financial aid offer form, including the actual or 
                estimated costs included in the total cost of 
                attendance for such year for each of the following:
                            ``(i) Tuition and fees.
                            ``(ii) Room and board costs.
                            ``(iii) Books and supplies.
                            ``(iv) Transportation and miscellaneous 
                        expenses.
                    ``(B) The amount of financial aid that the student 
                does not have to repay, such as scholarships and 
                grants, offered to the student for such year.
                    ``(C) The conditions under which the financial aid 
                described in subparagraph (B) is renewable each year.
                    ``(D) The net cost of attendance for the student, 
                calculated as the total cost of attendance for the 
                student (as described in subparagraph (A) less the 
                amount of financial aid that the student does not have 
                to repay (as described in subparagraph (B)).
                    ``(E) The amount of work-study assistance offered 
                to the student for such year, and the conditions that 
                the student has to fulfill for the work-study 
                assistance.
                    ``(F) Information about loans for which the 
                student, or a parent of the student, is eligible for 
                such year and loans the covered institution recommends 
                for such year, as the Secretary determines necessary 
                for the model formats to meet the definition of 
                adequacy under this part. The information shall include 
                the applicable interest rates and other terms and 
                conditions of the loans, including the estimated 
                monthly repayment amount. The loans may include loans 
                under part B, D, or E of title IV or awards under 
                subpart 9 of part A of title IV (TEACH Grants).
                    ``(G) Where a student or the student's parent can 
                seek additional information regarding the financial aid 
                offered.
                    ``(H) Any other information the Secretary 
                determines necessary so that students and parents can 
                make informed student loan borrowing decisions.
    ``(b) Covered Institution Duties.--Not later than 1 year after the 
release of the report and model financial aid offer formats described 
in subsection (a), each covered institution shall--
            ``(1) use one of the model financial aid offer formats as 
        part of the information provided in any financial aid offer 
        form that the covered institution provides to a student 
        attending or planning to attend the covered institution, or the 
        parents of such student; and
            ``(2) ensure that such student and the parents of such 
        student receive the financial aid offer form in time for such 
        student or parent to take the information provided into account 
        before applying for or selecting an educational loan.''.