I 

116TH CONGRESS 

1ST SESSION H. R. 4497 

To amend the Higher Education Act of 1965 to make improvements to 

the Federal Student Aid Office, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

SEPTEMBER 25, 2019 

Ms. SHALALA (for herself, Ms. PRESSLEY, Ms. TLAIB, Ms. JACKSON LEE, Ms. 

MOORE, and Ms. HAALAND) introduced the following bill; which was referred to the Committee on Education and Labor 

A BILL 

To amend the Higher Education Act of 1965 to make improvements to the Federal Student Aid Office, 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 ‘‘Protecting Student Aid 

5 Act of 2019’’ or the ‘‘PSA Act of 2019’’. 

6 SEC. 2. IMPROVEMENTS TO THE FEDERAL STUDENT AID 

7 OFFICE. 

8 Section 141 of the Higher Education Act of 1965 (20 

9 U.S.C. 1018) is amended— 


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1 (1) by redesignating subsection (i) as subsection 

2 (k); and 

3 (2) by inserting after subsection (h) the fol4 lowing: 

5 ‘‘(i) ENFORCEMENT UNIT.— 

6 ‘‘(1) IN GENERAL.—Not later than 180 days 

7 after the date of enactment of the PSA Act of 2019, 

8 the Secretary shall establish within the PBO an en9 forcement unit (referred to in this section as the 

10 ‘Unit’) to review and investigate violations of this 

11 Act and recommend enforcement actions in accord12 ance with paragraph (3). 

13 ‘‘(2) CHIEF ENFORCEMENT OFFICER.— 

14 ‘‘(A) APPOINTMENT.—The Secretary shall 

15 appoint an official to be known as the ‘Chief 

16 Enforcement Officer’ who shall serve as the 

17 head of the Unit. The Secretary shall appoint 

18 an individual to serve as the Chief Enforcement 

19 Officer solely on the basis of such individual’s 

20 integrity and expertise in law and investigations 

21 and without regard to such individual’s political 

22 affiliation. 

23 ‘‘(B) AUTHORITY.—The Chief Enforce24 ment Officer shall report directly to the Sec25 retary without being required to report through 


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1 any other official of the Department of Edu2 cation. 

3 ‘‘(C) TERM.—The Chief Enforcement Offi4 cer shall be appointed for a term of 6 years and 

5 may be reappointed for additional terms of 6 

6 years at the discretion of the Secretary. 

7 ‘‘(D) REMOVAL.— 

8 ‘‘(i) IN GENERAL.—The Chief En9 forcement Officer may not be removed dur10 ing the Officer’s term except for cause. 

11 ‘‘(ii) NOTICE TO CONGRESS.—If the 

12 Secretary removes the Chief Enforcement 

13 Officer before the expiration of the Offi14 cer’s term, the Secretary shall submit to 

15 the authorizing committees a report that 

16 explains the reasons for such removal. The 

17 report shall be submitted to the author18 izing committees not later than 30 days 

19 after the date on which the removal takes 

20 effect. 

21 ‘‘(3) DUTIES.—The Chief Enforcement Officer 

22 shall have the following duties: 

23 ‘‘(A) Receive, process, and analyze allega24 tions that a covered entity has violated Federal 


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1 law or has engaged in unfair, deceptive, or abu2 sive practices. 

3 ‘‘(B) Review and investigate such allega4 tions. 

5 ‘‘(C) After reviewing and investigating an 

6 allegation under subparagraph (B), in consulta7 tion with the Chief Operating Officer— 

8 ‘‘(i) if the covered entity subject to 

9 such allegation is an entity described in 

10 clause (i) or (iii) of paragraph (8)(A), 

11 make recommendations with respect to 

12 such covered entity, including— 

13 ‘‘(I) whether such covered entity 

14 should be limited, suspended, or ter15 minated from participation in one or 

16 more programs under title IV; 

17 ‘‘(II) whether such covered entity 

18 should be subject to an emergency ac19 tion under section 487(c)(1)(G); or 

20 ‘‘(III) a combination of any of 

21 the actions described in clauses (II) 

22 and (III); 

23 ‘‘(ii) if the covered entity subject to 

24 such allegation is an entity described in 

25 clause (ii) of paragraph (8)(A), make recVerDate Sep 11 2014 03:04 Oct 01, 2019 Jkt 089200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H4497.IH H4497

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1 ommendations with respect to such covered 

2 entity, including whether such covered en3 tity should be limited, suspended, or termi4 nated from administering or providing 

5 services with respect to one or more pro6 grams under title IV; and 

7 ‘‘(iii) provide the Secretary with such 

8 recommendations. 

9 ‘‘(4) SECRETARIAL REVIEW AND ACTION.— 

10 After receiving notice of a determination of the Chief 

11 Enforcement Officer under paragraph (4)(C), the 

12 Secretary shall decide whether or not to pursue en13 forcement action against the entity concerned. In a 

14 case in which the Chief Enforcement Officer rec15 ommends enforcement action against an entity, but 

16 the Secretary decides not to pursue such enforce17 ment action, the Secretary shall notify the Chief En18 forcement Officer, in writing, of the rationale for 

19 such decision. 

20 ‘‘(5) COORDINATION AND STAFFING.—The 

21 Chief Enforcement Officer shall— 

22 ‘‘(A) coordinate with relevant Federal and 

23 State agencies and oversight bodies; and 

24 ‘‘(B) hire staff with the expertise necessary 

25 to conduct investigations, respond to allegations 


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1 against covered entities, and enforce compliance 

2 with laws governing Federal student financial 

3 assistance programs under title IV. 

4 ‘‘(6) INFORMATION SHARING.—The Chief En5 forcement Officer shall develop and implement a 

6 process for sharing relevant information about alle7 gations against covered entities with— 

8 ‘‘(A) the Student Loan Ombudsman ap9 pointed under subsection (f); 

10 ‘‘(B) personnel of the Department respon11 sible for processing borrower defense claims 

12 submitted under section 455(h); 

13 ‘‘(C) other relevant Federal agencies; 

14 ‘‘(D) States, including State law enforce15 ment and regulatory agencies; and 

16 ‘‘(E) recognized accrediting agencies or as17 sociations. 

18 ‘‘(7) REPORT TO CONGRESS.—On an annual 

19 basis, the Chief Enforcement Officer shall submit to 

20 the authorizing committees a report that includes— 

21 ‘‘(A) the number of allegations about cov22 ered entities received by the Unit in the year 

23 covered by the report; 

24 ‘‘(B) the number of such allegations inves25 tigated by the Unit; 


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1 ‘‘(C) the number of such allegations that 

2 were referred to the Secretary under paragraph 

3 (4)(C) and a summary of any action taken by 

4 the Secretary with respect to such allegations; 

5 ‘‘(D) the number of such allegations that 

6 were referred to other Federal agencies and the 

7 names of the agencies to which the allegations 

8 were referred; and 

9 ‘‘(E) the number of such allegations that 

10 remain under review or investigation as of the 

11 date of the report. 

12 ‘‘(8) DEFINITIONS.—In this subsection: 

13 ‘‘(A) COVERED ENTITY DEFINED.—In this 

14 subsection, the term ‘covered entity’ means— 

15 ‘‘(i) an institution of higher education 

16 (as defined in section 102) that partici17 pates in the Federal student financial as18 sistance programs authorized under title 

19 IV; 

20 ‘‘(ii) a contractor that contracts with 

21 the PBO to provide services relating to 

22 such programs, or a subcontractor of such 

23 contractor; or 

24 ‘‘(iii) a third party servicer. 


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1 ‘‘(B) THIRD PARTY SERVICER.—The term 

2 ‘third party servicer’ has the meaning given 

3 that term in section 481(c).’’. 

4 SEC. 3. DEFINITION OF THIRD PARTY SERVICER. 

5 Section 481(c) of the Higher Education Act of 1965 

6 (20 U.S.C. 1088(c)) is amended— 

7 (1) in the matter preceding paragraph (1), by 

8 striking ‘‘contract’’ and inserting ‘‘contract or other 

9 agreement, including a revenue sharing arrange10 ment,’’; and 

11 (2) in paragraph (1), by striking ‘‘, through ei12 ther manual or automated processing, any aspect of 

13 such institution’s student assistance programs’’ and 

14 inserting ‘‘services on behalf of the institution re15 ceiving student assistance funds’’. 

Æ 


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