II 

Calendar No. 125 

113TH CONGRESS 

1ST SESSION S. 1241 

To establish the interest rate for certain Federal student loans, and for 

other purposes. 

IN THE SENATE OF THE UNITED STATES 

JUNE 27, 2013 

Mr. MANCHIN (for himself, Mr. KING, Mr. ALEXANDER, Mr. COBURN, Mr. 

BURR, Mr. CARPER, Ms. AYOTTE, and Mr. ISAKSON) introduced the following bill; which was read twice and ordered placed on the calendar 

A BILL 

To establish the interest rate for certain Federal student 

loans, and for other purposes. 

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 ‘‘Bipartisan Student 

5 Loan Certainty Act’’. 


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1 SEC. 2. INTEREST RATES. 

2 (a) INTEREST RATE PROVISIONS AND DISCLO3 SURES.—Section 455 of the Higher Education Act of 

4 1965 (20 U.S.C. 1087e) is amended— 

5 (1) in subsection (b)(7)(C), by inserting ‘‘and 

6 before July 1, 2013,’’ after‘‘ July 1, 2006,’’; and 

7 (2) by adding at the end of the following: 

8 ‘‘(E) INTEREST RATE PROVISIONS FOR

9 NEW LOANS ON OR AFTER JULY 1, 2013.— 

10 ‘‘(i) FEDERAL DIRECT STAFFORD

11 LOANS, FEDERAL DIRECT UNSUBSIDIZED

12 STAFFORD LOANS, AND FEDERAL DIRECT

13 PLUS LOANS.— 

14 ‘‘(I) IN GENERAL.—Notwith15 standing the preceding paragraphs of 

16 this subsection or subparagraph (A) 

17 or (B), for Federal Direct Stafford 

18 Loans, Federal Direct Unsubsidized 

19 Stafford Loans, and Federal Direct 

20 PLUS Loans for which the first dis21 bursement is made on or after July 1, 

22 2013, the applicable rate of interest 

23 shall, for loans disbursed during any 

24 12-month period beginning on July 1 

25 and ending on June 30, be determined 


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1 on the preceding June 1 and be equal 

2 to— 

3 ‘‘(aa) the bond equivalent 

4 rate of 10-year Treasury bills 

5 auctioned at the final auction 

6 held prior to such June 1; plus 

7 ‘‘(bb)(AA) 1.85 percent for 

8 Federal Direct Stafford Loans 

9 and Federal Direct Unsubsidized 

10 Stafford Loans for under11 graduate students; 

12 ‘‘(BB) 3.4 percent for Fed13 eral Direct Unsubsidized Stafford 

14 Loans for graduate students; and 

15 ‘‘(CC) 4.4 percent for Fed16 eral Direct PLUS Loans. 

17 ‘‘(II) CONSULTATION.—The Sec18 retary shall determine the applicable 

19 rates of interest under this clause 

20 after consultation with the Secretary 

21 of the Treasury and shall publish such 

22 rate in the Federal Register on or be23 fore June 5 preceding the award year 

24 for which the rate is determined. 


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1 ‘‘(III) RATE.—The applicable 

2 rate of interest determined under sub3 clause (I) for a Federal Direct Staf4 ford Loan, a Federal Direct Unsub5 sidized Stafford Loan, or a Federal 

6 Direct PLUS Loan shall be fixed for 

7 the period of the Loan. 

8 ‘‘(ii) CONSOLIDATION LOANS.—Any 

9 Federal Direct Consolidation Loan for 

10 which the application is received on or 

11 after July 1, 2013, shall bear interest at 

12 an annual rate on the unpaid principal bal13 ance of the loan that is equal to the lesser 

14 of— 

15 ‘‘(I) the weighted average of the 

16 interest rates on the loans consoli17 dated, rounded to the nearest higher 

18 one-eighth of one percent; or 

19 ‘‘(II) 8.25 percent.’’. 

20 (b) EXIT COUNSELING REQUIREMENT.—Section 

21 485(b)(1)(A)(vii) is amended— 

22 (1) by redesignating subclauses (III) and (IV) 

23 as subclauses (VI) and (VII), respectively; and 

24 (2) by inserting after subclause (II) the fol25 lowing: 


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1 ‘‘(III) the borrower’s options for 

2 loan consolidation; 

3 ‘‘(IV) information about the in4 come-based repayment plan under sec5 tion 493C, including information 

6 about capped monthly payments and 

7 loan forgiveness under such plan; 

8 ‘‘(V) information about Federal 

9 Direct Consolidation Loans, which for 

10 applications received on or after July 

11 1, 2013, have a maximum interest 

12 rate of 8.25 percent, as described 

13 under section 455(b)(7)(E)(ii)’’. 

14 SEC. 3. RULE OF CONSTRUCTION. 

15 Nothing in this Act shall be construed to provide the 

16 Secretary of Education with the authority to require, or 

17 promulgate regulations requiring, new counseling not oth18 erwise required by section 2, and the amendments made 

19 by such section, or the Higher Education Act of 1965 (20 

20 U.S.C. 1001 et seq.). 

21 SEC. 4. DETERMINATION OF BUDGETARY EFFECTS. 

22 The budgetary effects of this Act, for the purpose of 

23 complying with the Statutory Pay-As-You-Go Act of 2010, 

24 shall be determined by reference to the latest statement 

25 titled ‘‘Budgetary Effects of PAYGO Legislation’’ for this 


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1 Act, submitted for printing in the Congressional Record 

2 by the Chairman of the Senate Budget Committee, pro3 vided that such statement has been submitted prior to the 

4 vote on passage. 


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Calendar No. 125 

113TH CONGRESS 

1ST SESSION S. 1241 

A BILL 

To establish the interest rate for certain Federal 

student loans, and for other purposes. 

JUNE 27, 2013 

Read twice and ordered placed on the calendar 


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