I 

114TH CONGRESS 

1ST SESSION H. R. 4222 

To direct the Secretary of Education to carry out a pilot program under 

which higher education savings accounts are established for the benefit 

of eligible secondary school students. 

IN THE HOUSE OF REPRESENTATIVES 

DECEMBER 10, 2015 

Mr. CARNEY introduced the following bill; which was referred to the Committee on Education and the Workforce, and in addition to the Committee on Ways and Means, for a period to be subsequently determined 

by the Speaker, in each case for consideration of such provisions as fall 

within the jurisdiction of the committee concerned 

A BILL 

To direct the Secretary of Education to carry out a pilot 

program under which higher education savings accounts 

are established for the benefit of eligible secondary school 

students. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Higher Education Sav5 ings Accounts Act of 2015’’. 


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1 SEC. 2. HIGHER EDUCATION PLEDGE ACCOUNTS PILOT 

2 PROGRAM. 

3 (a) IN GENERAL.—The Secretary shall carry out a 

4 pilot program under which savings accounts (to be known 

5 as ‘‘higher education pledge accounts’’) are established for 

6 the benefit of eligible students in accordance with this sec7 tion. 

8 (b) ELIGIBILITY AND SELECTION OF PARTICI9 PANTS.— 

10 (1) ELIGIBLE STUDENTS.—To be eligible to 

11 participate in the pilot program, a student must 

12 be— 

13 (A) enrolled in the 9th or 10th grade at a 

14 secondary school; and 

15 (B) eligible to receive free or reduced price 

16 lunches under the Richard B. Russell National 

17 School Lunch Act (42 U.S.C. 1751 et seq.). 

18 (2) SELECTION OF ELIGIBLE STUDENTS.—The 

19 Secretary shall select eligible students for participa20 tion in the pilot program based on such criteria as 

21 the Secretary determines to be appropriate. 

22 (c) DEPOSITS.— 

23 (1) INITIAL DEPOSIT.— 

24 (A) IN GENERAL.—The Secretary shall de25 posit an initial amount into each higher edu26 cation pledge account. 


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1 (B) AMOUNT OF INITIAL DEPOSIT.—The 

2 amount of the initial deposit described in sub3 paragraph (A) shall be equal to the amount of 

4 the maximum Federal Pell Grant under section 

5 401(b) of the Higher Education Act of 1965, as 

6 specified in the last enacted appropriation Act 

7 applicable to that award year. 

8 (2) SUBSEQUENT DEPOSITS.— 

9 (A) IN GENERAL.—The Secretary may 

10 make additional deposits into a higher edu11 cation pledge account based on an evaluation of 

12 the academic progress of the student in accord13 ance with subsection (g). 

14 (B) AMOUNT OF SUBSEQUENT DEPOS15 ITS.—The amount of an additional deposit 

16 made under subparagraph (A) for an award 

17 year beginning after the date of the initial de18 posit under paragraph (1) shall be not less than 

19 the amount of the maximum Federal Pell Grant 

20 under section 401(b) of the Higher Education 

21 Act of 1965, as specified in the last enacted ap22 propriation Act applicable to that award year. 

23 (d) DISTRIBUTIONS.—A student may use funds from 

24 the student’s higher education pledge account only to pay 

25 the cost of attendance at a qualified institution. 


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1 (e) TAX TREATMENT OF ACCOUNTS.— 

2 (1) IN GENERAL.—A higher education pledge 

3 account is exempt from taxation under subtitle A of 

4 the Internal Revenue Code of 1986. 

5 (2) CONTRIBUTIONS AND DISTRIBUTIONS.—For 

6 purposes of such subtitle— 

7 (A) any contribution to a higher education 

8 pledge account by the Secretary under this Act 

9 shall not be includible in gross income; and 

10 (B) any distribution from a higher edu11 cation pledge account which is permitted under 

12 this Act shall not be includible in the gross in13 come of the individual for whose benefit such 

14 account is maintained. 

15 (f) OFFSET OF FEDERAL PELL GRANT AMOUNTS.— 

16 The amount of any Federal Pell Grant awarded to a stu17 dent attending a qualified institution shall be reduced by 

18 the amount in such student’s higher education pledge ac19 count. 

20 (g) MONITORING OF ACADEMIC PROGRESS.—The 

21 Secretary shall monitor the academic progress of each stu22 dent for whose benefit a higher education pledge account 

23 is maintained. 

24 (h) FINANCIAL COUNSELING.—The Secretary shall 

25 ensure that each student for whose benefit a higher eduVerDate Sep 11 2014 21:13 Dec 11, 2015 Jkt 059200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H4222.IH H4222

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1 cation pledge account is maintained receives not less than 

2 12 hours of financial counseling with respect to— 

3 (1) the rules pertaining to deposits, distribu4 tions, and the tax treatment of funds in the higher 

5 education pledge account; and 

6 (2) sources of Federal financial assistance for 

7 higher education. 

8 SEC. 3. DEFINITIONS. 

9 In this Act: 

10 (1) COST OF ATTENDANCE.—The term ‘‘cost of 

11 attendance’’ has the meaning given the term in sec12 tion 472 of the Higher Education Act of 1965 (20 

13 U.S.C. 1087ll). 

14 (2) FEDERAL FINANCIAL ASSISTANCE.—The 

15 term ‘‘Federal financial assistance’’ means any 

16 grant, loan, or other financial assistance that may 

17 be provided to an individual student under the High18 er Education Act of 1965. 

19 (3) INSTITUTION OF HIGHER EDUCATION.—The 

20 term ‘‘institution of higher education’’ has the 

21 meaning given the term in section 102(a) of the 

22 Higher Education Act of 1965 (20 U.S.C. 1002(a)) 

23 except that such term does not include proprietary 

24 institutions of higher education (as defined in sec25 tion 102(b) of such Act (20 U.S.C. 1002(b))). 


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1 (4) QUALIFIED INSTITUTION.—The term 

2 ‘‘qualified institution’’ means an institution of high3 er education that— 

4 (A) has in effect a program participation 

5 agreement under section 487 of the Higher 

6 Education Act of 1965 (20 U.S.C. 1094); and 

7 (B) is eligible to participate in programs 

8 under title IV of such Act (20 U.S.C. 1070 et 

9 seq.). 

10 (5) SECONDARY SCHOOL.—The term ‘‘sec11 ondary school’’ has the meaning given the term in 

12 section 9101 of the Elementary and Secondary Edu13 cation Act of 1965 (20 U.S.C. 7801). 

14 (6) SECRETARY.—The term ‘‘Secretary’’ means 

15 the Secretary of Education. 

Æ 


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