II 

113TH CONGRESS 

1ST SESSION S. 1156 

To amend the Higher Education Opportunity Act to add disclosure requirements to the institution financial aid offer form and to amend the 

Higher Education Act of 1965 to make such form mandatory. 

IN THE SENATE OF THE UNITED STATES 

JUNE 13, 2013 

Mr. FRANKEN (for himself, Mr. GRASSLEY, Mr. HARKIN, Mr. RUBIO, Mrs. 

GILLIBRAND, Mrs. MURRAY, Mr. CARDIN, Mr. SCHUMER, Mr. CARPER, 

Mr. BLUMENTHAL, Mr. WYDEN, Mr. DURBIN, Mr. WHITEHOUSE, Mr. 

JOHNSON of South Dakota, Mr. COONS, and Ms. MIKULSKI) introduced 

the following bill; which was read twice and referred to the Committee 

on Health, Education, Labor, and Pensions 

A BILL 

To amend the Higher Education Opportunity Act to add 

disclosure requirements to the institution financial aid 

offer form and to amend the Higher Education Act of 

1965 to make such form mandatory. 

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 ‘‘Understanding the 

5 True Cost of College Act of 2013’’. 

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1 SEC. 2. INSTITUTION FINANCIAL AID OFFER FORM. 

2 (a) INSTITUTION FINANCIAL AID OFFER FORM.— 

3 Section 484 of the Higher Education Opportunity Act (20 

4 U.S.C. 1092 note) is amended— 

5 (1) by striking subsection (a) and inserting the 

6 following: 

7 ‘‘(a) STANDARD FORMAT.—The Secretary of Edu8 cation, in consultation with the heads of relevant Federal 

9 agencies, shall develop a standard format for financial aid 

10 offer forms based on recommendations from representa11 tives of students, students’ families, institutions of higher 

12 education, secondary school and postsecondary counselors, 

13 and nonprofit consumer groups.’’; 

14 (2) by striking subsection (b) and inserting the 

15 following: 

16 ‘‘(b) KEY REQUIRED CONTENTS FOR OFFER

17 FORM.—The standard format developed under subsection 

18 (a) shall include, in a consumer-friendly manner that is 

19 simple and understandable, the following items clearly sep20 arated from each other and listed on the first page of the 

21 financial aid offer form in either electronic or written for22 mat: 

23 ‘‘(1) Information on the student’s cost of at24 tendance based on the most current costs for the 

25 academic period covered by the financial aid offer 

26 form, including the following: 

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1 ‘‘(A) Tuition and fees, as determined 

2 under section 472 of the Higher Education Act 

3 of 1965 (20 U.S.C. 1087ll). 

4 ‘‘(B) Room and board costs, as determined 

5 under section 472 of the Higher Education Act 

6 of 1965 (20 U.S.C. 1087ll). 

7 ‘‘(C) Books and supplies, as determined 

8 under section 472 of the Higher Education Act 

9 of 1965 (20 U.S.C. 1087ll). 

10 ‘‘(D) Transportation, as determined under 

11 section 472 of the Higher Education Act of 

12 1965 (20 U.S.C. 1087ll). 

13 ‘‘(E) Miscellaneous personal expenses, as 

14 determined under section 472 of the Higher 

15 Education Act of 1965 (20 U.S.C. 1087ll). 

16 ‘‘(2) The amount of financial aid that the stu17 dent does not have to repay, such as scholarships, 

18 grant aid offered under title IV of the Higher Edu19 cation Act of 1965 (20 U.S.C. 1070 et seq.), or 

20 grant aid offered by the institution, a State, or an 

21 outside source to the student for such academic pe22 riod, including a disclosure that the financial aid 

23 does not have to be repaid and whether the student 

24 can expect to receive similar amounts of such finanmstockstill on DSK4VPTVN1PROD with BILLS

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1 cial aid for each academic period the student is en2 rolled at the institution. 

3 ‘‘(3) The net price that the student, or the stu4 dent’s family on behalf of the student, will have to 

5 pay for the student to attend the institution for such 

6 academic period, equal to— 

7 ‘‘(A) the cost of attendance as described in 

8 paragraph (1) for the student for such aca9 demic period, minus 

10 ‘‘(B) the amount of financial aid described 

11 in paragraph (2) that is included in the finan12 cial aid offer form. 

13 ‘‘(4) Work study assistance, including a disclo14 sure that the aid must be earned by the student and 

15 a disclosure that the assistance offered is subject to 

16 the availability of employment opportunities. 

17 ‘‘(5) The types and amounts of loans under 

18 part D or E of title IV of the Higher Education Act 

19 of 1965 (20 U.S.C. 1087a et seq., 1087aa et seq.) 

20 that the institution recommends for the student for 

21 such academic period, a disclosure that such loans 

22 have to be repaid, a disclosure that the student can 

23 borrow a lesser amount than the recommended loan 

24 amount, a clear use of the word ‘loan’ to describe 

25 the recommended loan amounts, the interest rates, 

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1 fees, the expected monthly repayment amounts (as2 suming a 10-year repayment plan), the total amount 

3 the student will pay over the life of the loans (as4 suming a 10-year repayment plan), and a disclosure 

5 that the student may be eligible for longer repay6 ment terms, such as extended or income-based plans, 

7 and that longer repayment terms may result in the 

8 student paying more money over the life of the 

9 loans. 

10 ‘‘(6) Where a student or the student’s family 

11 can seek additional information regarding the finan12 cial aid offered, including contact information for 

13 the institution’s financial aid office and the Depart14 ment of Education’s website on financial aid. 

15 ‘‘(7) A disclosure that Federal student loans 

16 offer generally more favorable terms and beneficial 

17 repayment options than private education loans so 

18 students should examine available Federal student 

19 loan options before applying for private education 

20 loans, and an explanation to be written by the Sec21 retary of Education, in consultation with the heads 

22 of relevant Federal agencies, of the benefits unique 

23 to Federal student loans, including various repay24 ment plans, loan forgiveness, and loan deferment, 

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1 and the terms to examine carefully if considering a 

2 private education loan. 

3 ‘‘(8) The deadline and summary of the process, 

4 if any, for accepting the financial aid offered in the 

5 financial aid offer form. 

6 ‘‘(9) The academic period covered by the finan7 cial aid offer form and a clear indication whether the 

8 aid offered is based on full-time or part-time enroll9 ment. 

10 ‘‘(10) With respect to institutions where more 

11 than 30 percent of enrolled students borrow loans to 

12 pay for their education, the institution’s most recent 

13 cohort default rate, as defined in section 435(m) of 

14 the Higher Education Act of 1965 (20 U.S.C. 

15 1085(m)), compared to the national average cohort 

16 default rate. 

17 ‘‘(11) Any other information the Secretary of 

18 Education, in consultation with the heads of relevant 

19 Federal agencies, determines necessary so that stu20 dents and parents can make informed loan bor21 rowing decisions, including quality metrics such as 

22 percentage of students at the institution who take 

23 out student loans and average debt at graduation for 

24 students at the institution.’’; and 

25 (3) by adding at the end the following: 

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1 ‘‘(c) OTHER REQUIRED CONTENTS FOR THE OFFER

2 FORM.—The standard format developed under subsection 

3 (a) shall also include the following information to be in4 cluded on the financial aid offer form in a concise format 

5 determined by the Secretary of Education, in consultation 

6 with the heads of relevant Federal agencies: 

7 ‘‘(1) A concise summary of the terms and con8 ditions of financial aid recommended under para9 graphs (2), (4), and (5) of subsection (b), and a 

10 method to provide students with additional informa11 tion about such terms and conditions, such as links 

12 to the supplementary information. 

13 ‘‘(2) At the institution’s discretion, additional 

14 options for paying for the net amount listed in sub15 section (b)(3), such as the amount recommended to 

16 be paid by the student or student’s family, Federal 

17 Direct PLUS Loans under section 455 of the High18 er Education Act of 1965 (20 U.S.C. 1087e), or pri19 vate education loans. If the institution recommends 

20 private education loans, as defined in section 140 of 

21 the Truth in Lending Act (15 U.S.C. 1650), the fi22 nancial aid offer form shall contain the additional 

23 following disclosures on the offer form: 

24 ‘‘(A) The availability of, and the student’s 

25 potential eligibility for, Federal financial assistmstockstill on DSK4VPTVN1PROD with BILLS

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1 ance under title IV of the Higher Education 

2 Act of 1965 (20 U.S.C. 1070 et seq.). 

3 ‘‘(B) The impact of a proposed private 

4 education loan on the student’s potential eligi5 bility for other financial assistance, including 

6 Federal financial assistance under title IV of 

7 the Higher Education Act of 1965 (20 U.S.C. 

8 1070 et seq.). 

9 ‘‘(C) The student’s ability to select a pri10 vate educational lender of the student’s choice. 

11 ‘‘(D) The student’s right to accept or re12 ject a private education loan within the 30-day 

13 period following a private educational lender’s 

14 approval of a student’s application and a stu15 dent’s 3-day right-to-cancel period. 

16 ‘‘(E) With respect to dependent students, 

17 any reference to private education loans shall be 

18 accompanied by information about the rec19 ommended family contribution and the avail20 ability of, and terms and conditions associated 

21 with, Federal Direct PLUS Loans under sec22 tion 455 of the Higher Education Act of 1965 

23 (20 U.S.C. 1087e) for the student’s parents re24 gardless of family income, and of the student’s 

25 increased eligibility for Federal student loans 

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1 under title IV of the Higher Education Act of 

2 1965 (20 U.S.C. 1070 et seq.) if the student’s 

3 parents are not able to borrow under the Fed4 eral Direct PLUS Loan program. 

5 ‘‘(3) The following disclosures: 

6 ‘‘(A) That the financial aid offer form only 

7 contains information for 1 academic period and 

8 the financial aid offered in following academic 

9 periods may change, unless the institution is of10 fering aid that covers multiple academic peri11 ods. 

12 ‘‘(B) How non-institutional scholarships 

13 awarded to the student affect the financial aid 

14 package offered to the student. 

15 ‘‘(C) A concise summary of any Federal or 

16 institutional conditions required to receive and 

17 renew financial aid and a method to provide 

18 students with additional information about 

19 these conditions, such as links to the supple20 mentary information. 

21 ‘‘(d) ADDITIONAL REQUIREMENTS FOR FINANCIAL

22 AID OFFER FORM.—In addition to the requirements listed 

23 under subsections (b) and (c), the financial aid offer form 

24 shall meet the following requirements: 

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1 ‘‘(1) Clearly distinguish between the aid offered 

2 in paragraphs (2), (4), and (5) of subsection (b), by 

3 including a subtotal for the aid offered in each of 

4 such paragraphs and by refraining from commin5 gling the different types of aid described in such 

6 paragraphs. 

7 ‘‘(2) Use standard definitions and names for 

8 the terms described in subsection (b) that are devel9 oped by the Secretary of Education in consultation 

10 with the heads of relevant Federal agencies, rep11 resentatives of institutions of higher education, non12 profit consumer groups, students, and secondary 

13 school and higher education guidance counselors, not 

14 later than 3 months after the date of enactment of 

15 the Understanding the True Cost of College Act of 

16 2013. 

17 ‘‘(3) If an institution’s recommended Federal 

18 student loan aid offered in subsection (b)(5) is less 

19 than the Federal maximum available to the student, 

20 the institution shall provide additional information 

21 on Federal student loans, including the types and 

22 amounts for which the student is eligible in an at23 tached document or webpage. 

24 ‘‘(4) Use standard formatting and design that 

25 the Secretary of Education, in consultation with the 

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1 heads of relevant Federal agencies, representatives 

2 of institutions of higher education, nonprofit con3 sumer groups, students, and secondary school and 

4 higher education guidance counselors determine is 

5 appropriate to produce multiple draft financial aid 

6 offer designs for consumer testing not later than 3 

7 months after the date of enactment of the Under8 standing the True Cost of College Act of 2013 to en9 sure— 

10 ‘‘(A) that figures described in paragraphs 

11 (1) through (5) of subsection (b) are in the 

12 same font, appear in the same order, and are 

13 displayed prominently on the first page of the 

14 financial aid offer form whether produced in 

15 written or electronic format; and 

16 ‘‘(B) that the other information required 

17 in (b) and (c) appears in a standard format and 

18 design on the financial aid offer form. 

19 ‘‘(5) Include an attestation that the student has 

20 accessed and read the financial aid offer form, if 

21 provided to the student in electronic format. 

22 ‘‘(6) Include language developed by the Sec23 retary of Education, in consultation with the heads 

24 of relevant Federal agencies, notifying eligible stu25 dents that they may be eligible for education benemstockstill on DSK4VPTVN1PROD with BILLS

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1 fits, and where they can locate more information 

2 about such benefits, described in the following provi3 sions: 

4 ‘‘(A) Chapter 30, 31, 32, 33, 34, or 35 of 

5 title 38, United States Code. 

6 ‘‘(B) Chapter 101, 105, 106A, 1606, 1607, 

7 or 1608 of title 10, United States Code. 

8 ‘‘(C) Section 1784a, 2005, or 2007 of title 

9 10, United States Code. 

10 ‘‘(e) ADDITIONAL INFORMATION.—Nothing in this 

11 section shall preclude an institution from supplementing 

12 the financial aid offer form with additional information so 

13 long as such additional information supplements the fi14 nancial aid offer form and is not located on the financial 

15 aid offer form. 

16 ‘‘(f) CONSUMER TESTING.— 

17 ‘‘(1) IN GENERAL.—Not later than 3 months 

18 after the date of enactment of the Understanding 

19 the True Cost of College Act of 2013, the Secretary 

20 of Education, in consultation with the heads of rel21 evant Federal agencies, shall establish a process to 

22 submit the financial aid offer form developed under 

23 this section for consumer testing among representa24 tives of students (including low-income students, 

25 first generation college students, adult students, and 

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1 prospective students), students’ families (including 

2 low-income families, families with first generation 

3 college students, and families with prospective stu4 dents), institutions of higher education, secondary 

5 school and postsecondary counselors, and nonprofit 

6 consumer groups. 

7 ‘‘(2) LENGTH OF CONSUMER TESTING.—The 

8 Secretary of Education shall ensure that the con9 sumer testing lasts no longer than 6 months after 

10 the process for consumer testing is developed under 

11 paragraph (1). 

12 ‘‘(3) USE OF RESULTS.—The results of con13 sumer testing under paragraph (1) shall be used in 

14 the final development of the financial aid offer form. 

15 ‘‘(4) REPORTING REQUIREMENT.—Not later 

16 than 3 months after the date the consumer testing 

17 under paragraph (1) concludes, the Secretary of 

18 Education shall submit to Congress the final stand19 ard financial aid offer form and a report detailing 

20 the results of such testing, including whether the 

21 Secretary added any additional items to the stand22 ard financial aid offer form pursuant to subsection 

23 (b)(10). 

24 ‘‘(5) AUTHORITY TO MODIFY.—The Secretary 

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1 matting, and design of the financial aid offer form 

2 based on the results of consumer testing required 

3 under this subsection and before finalizing the 

4 form.’’. 

5 (b) MANDATORY FORM.—Part B of title I of the 

6 Higher Education Act of 1965 (20 U.S.C. 1011 et seq.) 

7 is amended by adding at the end the following: 

8 ‘‘SEC. 124. USE OF MANDATORY FINANCIAL AID OFFER 

9 FORM. 

10 ‘‘(a) IN GENERAL.—Notwithstanding any other pro11 vision of law, each institution of higher education that re12 ceives Federal financial assistance under this Act shall use 

13 the financial aid offer form developed under section 484 

14 of the Higher Education Opportunity Act (20 U.S.C. 1092 

15 note) in providing written or electronic financial aid offers 

16 to students enrolled in, or accepted for enrollment in, the 

17 institution. 

18 ‘‘(b) EFFECTIVE DATE.—The requirement under 

19 subsection (a) shall take effect 8 months after the Sec20 retary of Education finalizes the offer form developed 

21 under section 484(a) of the Higher Education Oppor22 tunity Act (20 U.S.C. 1092 note).’’. 

Æ 

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