I 

117TH CONGRESS 

1ST SESSION H. R. 1222 

To amend the Higher Education Act of 1965 regarding proprietary 

institutions of higher education in order to protect students and taxpayers. 

IN THE HOUSE OF REPRESENTATIVES 

FEBRUARY 23, 2021 

Mr. COHEN (for himself, Ms. LEE of California, and Ms. ESHOO) introduced 

the following bill; which was referred to the Committee on Education and 

Labor 

A BILL 

To amend the Higher Education Act of 1965 regarding 

proprietary institutions of higher education in order to 

protect students and taxpayers. 

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 ‘‘Protecting Our Stu5 dents and Taxpayers Act of 2021’’ or ‘‘POST Act of 

6 2021’’. 

7 SEC. 2. 85/15 RULE. 

8 (a) IN GENERAL.—Section 102(b) of the Higher 

9 Education Act of 1965 (20 U.S.C. 1002(b)) is amended— 


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1 (1) in paragraph (1)— 

2 (A) in subparagraph (D), by striking 

3 ‘‘and’’ after the semicolon; 

4 (B) in subparagraph (E), by striking the 

5 period at the end and inserting ‘‘; and’’; and 

6 (C) by adding at the end the following: 

7 ‘‘(F) meets the requirements of paragraph 

8 (2).’’; 

9 (2) by redesignating paragraph (2) as para10 graph (3); and 

11 (3) by inserting after paragraph (1) the fol12 lowing: 

13 ‘‘(2) REVENUE SOURCES.— 

14 ‘‘(A) IN GENERAL.—In order to qualify as 

15 a proprietary institution of higher education 

16 under this subsection, an institution shall derive 

17 not less than 15 percent of the institution’s rev18 enues from sources other than Federal funds, 

19 as calculated in accordance with subparagraphs 

20 (B) and (C). 

21 ‘‘(B) FEDERAL EDUCATION ASSISTANCE

22 FUNDS.—In this paragraph, the term ‘Federal 

23 education assistance funds’ means any Federal 

24 financial assistance provided, under this Act or 

25 any other Federal law, through a grant, conVerDate Sep 11 2014 20:12 Mar 20, 2021 Jkt 019200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H1222.IH H1222

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1 tract, subsidy, loan, guarantee, insurance, or 

2 other means to a proprietary institution, includ3 ing Federal financial assistance that is dis4 bursed or delivered to an institution or on be5 half of a student or to a student to be used to 

6 attend the institution, except that such term 

7 shall not include any monthly housing stipend 

8 provided under the Post-9/11 Veterans Edu9 cational Assistance Program under chapter 33 

10 of title 38, United States Code. 

11 ‘‘(C) IMPLEMENTATION OF NON-FEDERAL

12 REVENUE REQUIREMENT.—In making calcula13 tions under subparagraph (A), an institution of 

14 higher education shall— 

15 ‘‘(i) use the cash basis of accounting; 

16 ‘‘(ii) consider as revenue only those 

17 funds generated by the institution from— 

18 ‘‘(I) tuition, fees, and other insti19 tutional charges for students enrolled 

20 in programs eligible for assistance 

21 under title IV; 

22 ‘‘(II) activities conducted by the 

23 institution that are necessary for the 

24 education and training of the institu25 tion’s students, if such activities are— 


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1 ‘‘(aa) conducted on campus 

2 or at a facility under the control 

3 of the institution; 

4 ‘‘(bb) performed under the 

5 supervision of a member of the 

6 institution’s faculty; and 

7 ‘‘(cc) required to be per8 formed by all students in a spe9 cific educational program at the 

10 institution; and 

11 ‘‘(III) a contractual arrangement 

12 with a Federal agency for the purpose 

13 of providing job training to low-in14 come individuals who are in need of 

15 such training; 

16 ‘‘(iii) presume that any Federal edu17 cation assistance funds that are disbursed 

18 or delivered to an institution on behalf of 

19 a student or directly to a student will be 

20 used to pay the student’s tuition, fees, or 

21 other institutional charges, regardless of 

22 whether the institution credits such funds 

23 to the student’s account or pays such 

24 funds directly to the student, except to the 

25 extent that the student’s tuition, fees, or 


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1 other institutional charges are satisfied 

2 by— 

3 ‘‘(I) grant funds provided by an 

4 outside source that— 

5 ‘‘(aa) has no affiliation with 

6 the institution; and 

7 ‘‘(bb) shares no employees, 

8 executives, or board members 

9 with the institution; and 

10 ‘‘(II) institutional scholarships 

11 described in clause (v); 

12 ‘‘(iv) include no loans made by an in13 stitution of higher education as revenue to 

14 the school, except for payments made by 

15 students on such loans; 

16 ‘‘(v) include a scholarship provided by 

17 the institution— 

18 ‘‘(I) only if the scholarship is in 

19 the form of monetary aid based upon 

20 the academic achievements or finan21 cial need of students, disbursed to 

22 qualified student recipients during 

23 each fiscal year from an established 

24 restricted account; and 


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1 ‘‘(II) only to the extent that 

2 funds in that account represent des3 ignated funds, or income earned on 

4 such funds, from an outside source 

5 that— 

6 ‘‘(aa) has no affiliation with 

7 the institution; and 

8 ‘‘(bb) shares no employees, 

9 executives, or board members 

10 with the institution; and 

11 ‘‘(vi) exclude from revenues— 

12 ‘‘(I) the amount of funds the in13 stitution received under part C of title 

14 IV, unless the institution used those 

15 funds to pay a student’s institutional 

16 charges; 

17 ‘‘(II) the amount of funds the in18 stitution received under subpart 4 of 

19 part A of title IV; 

20 ‘‘(III) the amount of funds pro21 vided by the institution as matching 

22 funds for any Federal program; 

23 ‘‘(IV) the amount of Federal edu24 cation assistance funds provided to 

25 the institution to pay institutional 


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1 charges for a student that were re2 funded or returned; and 

3 ‘‘(V) the amount charged for 

4 books, supplies, and equipment, unless 

5 the institution includes that amount 

6 as tuition, fees, or other institutional 

7 charges. 

8 ‘‘(D) REPORT TO CONGRESS.—Not later 

9 than July 1, 2020, and by July 1 of each suc10 ceeding year, the Secretary shall submit to the 

11 authorizing committees a report that contains, 

12 for each proprietary institution of higher edu13 cation that receives assistance under title IV 

14 and as provided in the audited financial state15 ments submitted to the Secretary by each insti16 tution pursuant to the requirements of section 

17 487(c)— 

18 ‘‘(i) the amount and percentage of 

19 such institution’s revenues received from 

20 Federal education assistance funds; and 

21 ‘‘(ii) the amount and percentage of 

22 such institution’s revenues received from 

23 other sources.’’. 


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1 (b) REPEAL OF EXISTING REQUIREMENTS.—Section 

2 487 of the Higher Education Act of 1965 (20 U.S.C. 

3 1094) is amended— 

4 (1) in subsection (a)— 

5 (A) by striking paragraph (24); 

6 (B) by redesignating paragraphs (25) 

7 through (29) as paragraphs (24) through (28), 

8 respectively; 

9 (C) in paragraph (24)(A)(ii) (as redesig10 nated by subparagraph (B)), by striking ‘‘sub11 section (e)’’ and inserting ‘‘subsection (d)’’; and 

12 (D) in paragraph (26) (as redesignated by 

13 subparagraph (B)), by striking ‘‘subsection (h)’’ 

14 and inserting ‘‘subsection (g)’’; 

15 (2) by striking subsection (d); 

16 (3) by redesignating subsections (e) through (j) 

17 as subsections (d) through (i), respectively; 

18 (4) in the matter preceding paragraph (1) of 

19 subsection (d) (as redesignated by paragraph (3)), 

20 by striking ‘‘(a)(25)’’ and inserting ‘‘(a)(24)’’; 

21 (5) in subsection (f)(1) (as redesignated by 

22 paragraph (3)), by striking ‘‘subsection (e)(2)’’ and 

23 inserting ‘‘subsection (d)(2)’’; and 

24 (6) in subsection (g)(1) (as redesignated by 

25 paragraph (3)), by striking ‘‘subsection (a)(27)’’ in 


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1 the matter preceding subparagraph (A) and insert2 ing ‘‘subsection (a)(26)’’. 

3 (c) CONFORMING AMENDMENTS.—The Higher Edu4 cation Act of 1965 (20 U.S.C. 1001 et seq.) is amended— 

5 (1) in section 152 (20 U.S.C. 1019a)— 

6 (A) in subsection (a)(1)(A), by striking 

7 ‘‘subsections (a)(27) and (h) of section 487’’ 

8 and inserting ‘‘subsections (a)(26) and (g) of 

9 section 487’’; and 

10 (B) in subsection (b)(1)(B)(i)(I), by strik11 ing ‘‘section 487(e)’’ and inserting ‘‘section 

12 487(d)’’; 

13 (2) in section 153(c)(3) (20 U.S.C. 

14 1019b(c)(3)), by striking ‘‘section 487(a)(25)’’ each 

15 place the term appears and inserting ‘‘section 

16 487(a)(24)’’; 

17 (3) in section 496(c)(3)(A) (20 U.S.C. 

18 1099b(c)(3)(A)), by striking ‘‘section 487(f)’’ and 

19 inserting ‘‘section 487(e)’’; and 

20 (4) in section 498(k)(1) (20 U.S.C. 

21 1099c(k)(1)), by striking ‘‘section 487(f)’’ and in22 serting ‘‘section 487(e)’’. 

Æ 


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