SECTION 1. EDUCATION SCHOLARS BLOCK GRANT PROGRAM.

    Part A of title IV of the Higher Education Act of 1965 (20 U.S.C. 
1070 et seq.) is amended by adding at the end the following:

          ``Subpart 9--Education Scholars Block Grant Program

``SEC. 420G. SHORT TITLE; PURPOSE; AUTHORIZATION OF APPROPRIATIONS.

    ``(a) Short Title.--This subpart may be cited as the `Teacher 
Investment Act'.
    ``(b) Purpose.--It is the purpose of this subpart--
            ``(1) to attract more of our Nation's most academically 
        gifted students into teaching careers in elementary and 
        secondary education;
            ``(2) to retain in teaching our Nation's best teachers who 
        have demonstrated promise in, and a commitment to, a teaching 
        career;
            ``(3) to increase the public status of a teaching career in 
        elementary and secondary education;
            ``(4) to address the anticipated shortage of teachers in 
        the next several decades; and
            ``(5) to provide States with the flexibility to integrate 
        State teacher education initiatives with Federal teacher 
        scholarship support.
    ``(c) Authorization of Appropriations.--There are authorized to be 
appropriated to carry out this subpart such sums as may be necessary 
for fiscal year 1998 and each of the 4 succeeding fiscal years.

``SEC. 420H. SCHOLARSHIP AUTHORIZED.

    ``(a) Program Authority.--The Secretary may award grants to States 
from allotments under section 420I to enable the States to provide 
scholarships to individuals who--
            ``(1)(A) have completed at least half of the academic 
        credit requirements for graduation from an institution of 
        higher education with a bachelor's degree, or with a graduate 
        degree that prepares the individual for licensure or 
        certification as an elementary school or secondary school 
        teacher;
            ``(2) are admitted to or enrolled in an institution of 
        higher education;
            ``(3) have demonstrated outstanding academic achievement 
        while enrolled in an institution of higher education; and
            ``(4) are committed to becoming or remaining elementary 
        school or secondary school teachers.
    ``(b) Period of Award.--A State shall determine the scholarship 
period, except that a scholarship recipient shall not receive a 
scholarship award for more than 2 years of study at any institution of 
higher education.

``SEC. 420I. ALLOTMENT AMONG STATES.

    ``(a) Allocation Formula.--From the sums appropriated pursuant to 
the authority of section 420G(c) for any fiscal year, the Secretary 
shall allot to each State that has an agreement under section 420J an 
amount equal to $5,000 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 available 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 from the Bureau of the 
Census that the Secretary determines is satisfactory.

``SEC. 420J. STATE AGREEMENTS.

    ``The Secretary shall enter into an agreement with each State 
desiring to participate in the scholarship program under this subpart. 
Each such agreement shall include provisions to ensure that--
            ``(1) the State educational agency will administer the 
        program in the State;
            ``(2) the State educational agency will comply with the 
        provisions of this subpart;
            ``(3) the State educational agency will conduct outreach 
        activities to publicize the availability of the scholarships to 
        all eligible postsecondary students in the State, with 
        particular emphasis on activities designed to ensure that 
        students from low-income and moderate-income families have 
        access to the information regarding the opportunity for full 
        participation in the program; and
            ``(4) the State educational agency will pay to each 
        individual in the State who is awarded a scholarship the cost 
        of tuition and fees at an institution of higher education for a 
        year, except that such payment shall not exceed $5,000.

``SEC. 420K. SELECTION OF EDUCATION SCHOLARS.

    ``(a) Establishment of Criteria.--The State educational agency 
shall establish the criteria for selection of scholars. Such criteria 
shall--
            ``(1) fulfill the purpose of the subpart in accordance with 
        a State's projected elementary school and secondary school 
        teaching needs and priorities; and
            ``(2) require a scholarship recipient to have demonstrated 
        outstanding academic achievement and a commitment to a teaching 
        career, as determined by the State educational agency.
    ``(b) Limitations.--In awarding scholarships under this subpart, 
the State educational agency shall provide--
            ``(1) not less than 75 percent of the scholarships to 
        individuals who do not possess a bachelor's degree; and
            ``(2) not more than 25 percent of the scholarships to 
        individuals who are pursuing a graduate degree.
    ``(c) Consultation Requirement.--In carrying out this subpart, the 
State educational agency shall consult with school administrators, 
school boards, teachers, and counselors.

``SEC. 420L. AWARD AMOUNT; SCHOLARSHIP CONDITIONS.

    ``(a) Award Amount.--Each individual awarded a scholarship under 
this subpart shall receive an award for the cost of tuition and fees at 
an institution of higher education of not more than $5,000 for an 
academic year of study.
    ``(b) Conditions.--Each State educational agency receiving a grant 
under this subpart shall establish procedures to ensure that each 
scholarship recipient--
            ``(1) pursues a course of study at an institution of higher 
        education;
            ``(2) maintains a 3.0 grade point average on a 4.0 scale; 
        and
            ``(3) enters into an agreement to teach in accordance with 
        section 420M(a).

``SEC. 420M. SCHOLARSHIP AGREEMENT; REPAYMENT PROVISIONS.

    ``(a) Scholarship Agreement.--Each recipient of a scholarship under 
this subpart shall enter into an agreement with the State educational 
agency under which the recipient shall--
            ``(1) within the 2-year period after completing the 
        education for which the scholarship was awarded, teach for a 
        period of 2 years as an elementary school or secondary school 
        teacher in the State served by the State educational agency;
            ``(2) provide the State educational agency with evidence of 
        compliance, determined pursuant to regulations promulgated by 
        the Secretary, with the provisions of paragraph (1); and
            ``(3) repay all or part of the scholarship award received 
        in accordance with subsection (b) in the event the conditions 
        of paragraph (1) are not complied with, except as provided by 
        section 420N.
    ``(b) Repayment Provisions.--A recipient of a scholarship found by 
the State educational agency to be in noncompliance with the agreement 
entered into under subsection (a) shall be required to repay to the 
State educational agency a pro rata amount of such scholarship 
assistance received, plus interest, at the rate of 8 percent or the 
rate applicable to loans in the applicable period under part B of this 
title, whichever is lower, and where applicable, reasonable collection 
fees, on a schedule to be prescribed by the Secretary pursuant to 
regulations promulgated under this subpart.

``SEC. 420N. EXCEPTIONS TO REPAYMENT PROVISIONS.

    ``(a) Deferral During Certain Periods.--A scholarship recipient 
shall not be considered in violation of the agreement entered into 
pursuant to section 420M(a) during any period in which the recipient--
            ``(1) is pursuing a full-time course of study related to 
        the field of teaching at an institution of higher education;
            ``(2) is serving, not in excess of 3 years, as a member of 
        the Armed Forces;
            ``(3) is temporarily totally disabled for a period of time 
        not to exceed 3 years as established by the sworn affidavit of 
        a qualified physician;
            ``(4) is unable to secure employment for a period not to 
        exceed 12 months by reason of the care required by a spouse who 
        is disabled;
            ``(5) is seeking and unable to find full-time employment 
        for a single period not to exceed 12 months; or
            ``(6) satisfies the provisions of additional repayment 
        exceptions that may be prescribed by the Secretary in 
        regulations promulgated under this subpart.
    ``(b) Forgiveness if Permanently Totally Disabled.--A recipient 
shall be excused from repayment of any scholarship assistance received 
under this subpart if the recipient becomes permanently and totally 
disabled as established by the sworn affidavit of a qualified 
physician.

``SEC. 420O. CONSTRUCTION OF NEEDS PROVISIONS.

    ``Except as provided in section 471, nothing in this subpart, or 
any other Act, shall be construed to permit the receipt of a 
scholarship under this subpart to be counted for any needs analysis in 
connection with the awarding of any grant or the making of any loan 
under this Act or any other provision of Federal law relating to 
education assistance.''.
Teacher Investment Act - Amends the Higher Education Act of 1965 to establish the Education Scholars Block Grant Program.  Authorizes appropriations. 
Authorizes the Secretary of Education to award such grants to States according to an allotment formula. 
Requires the use of such grant funds to provide scholarships to individuals who:  (1) have completed at least half of the academic credit requirements for graduation from an institution of higher education with a bachelor's degree, or with a graduate degree that prepares the individual for licensure or certification as an elementary school or secondary school teacher; (2) are admitted to or enrolled in an institution of higher education; (3) have demonstrated outstanding academic achievement while enrolled in an institution of higher education; and (4) are committed to becoming or remaining elementary school or secondary school teachers. 
Requires States to determine the scholarship period, but prohibits a scholarship recipient from receiving a scholarship award for more than two years of study at any institution of higher education. 
Sets forth requirements for:  (1) agreements between the Secretary and State educational agencies (SEAs) desiring to participate in the scholarship program; and (2) SEA establishment of criteria for selection of education scholars. 
Requires an SEA to provide at least 75 percent of the scholarships to undergraduates and not more than 25 percent to graduate students. 
Limits individual scholarship awards to not more than $5,000 for an academic year of study. 
Requires each scholarship recipient to agree to:  (1) teach for a period of two years as an elementary school or secondary school teacher in the State, within the two-year period after completing the education for which the scholarship was awarded; or (2) repay all or part of the scholarship award in the event of noncompliance, with specified exceptions. 
Excludes such scholarships from any needs analysis relating to other Federal education assistance.
Teacher Investment Act