II 

113TH CONGRESS 

2D SESSION S. 2993 

To amend the Higher Education Act of 1965 to improve the determination 

of cohort default rates and provide for enhanced civil penalties, and 

to authorize the establishment of an institutional risk-sharing commission. 

IN THE SENATE OF THE UNITED STATES 

DECEMBER 10, 2014 

Mr. MURPHY (for himself and Mr. HARKIN) 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 Act of 1965 to improve 

the determination of cohort default rates and provide 

for enhanced civil penalties, and to authorize the establishment of an institutional risk-sharing commission. 

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 ‘‘Students Before Prof5 its Act’’. 


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1 SEC. 2. IMPROVED DETERMINATION OF COHORT DEFAULT 

2 RATES. 

3 Section 435 (20 U.S.C. 1085) is amended— 

4 (1) in subsection (a)(2), by adding at the end 

5 the following: 

6 ‘‘(E)(i) In any case where the Secretary has de7 termined that the institution has engaged in default 

8 manipulation, the Secretary— 

9 ‘‘(I) shall recalculate the cohort default 

10 rate for the institution under this section using 

11 corrected data and information, for all fiscal 

12 years for which the default manipulation has 

13 occurred; and 

14 ‘‘(II) using the recalculated cohort default 

15 rate, shall redetermine whether the institution 

16 is ineligible to participate in a program under 

17 this title. 

18 ‘‘(ii) In this section, the term ‘default manipu19 lation’ means engaging in a device or practice, such 

20 as branching, consolidation of campuses, consolida21 tion or manipulation of the identification codes used 

22 by the Office of Postsecondary Education to des23 ignate campuses and institutions, change of owner24 ship or control, serial forbearance, or any similar de25 vice or practice (as determined by the Secretary) 

26 when, but for the device or practice, one or more 


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1 campuses of an institution of higher education would 

2 be at risk of cohort default rate sanctions under this 

3 section or student default risk sanctions under sec4 tion 489A.’’; and 

5 (2) in subsection (m)(3), by striking ‘‘through 

6 the use of’’ and all that follows through the period 

7 at the end and inserting ‘‘through default manipula8 tion.’’. 

9 SEC. 3. INSTITUTIONAL RISK-SHARING COMMISSION. 

10 (a) ESTABLISHMENT OF COMMISSION.— 

11 (1) IN GENERAL.—The Secretary of Education 

12 shall establish an Institutional Risk-Sharing Com13 mission (referred to in this section as the ‘‘Commis14 sion’’) whose members shall be selected by the Sec15 retary and comprised of the following relevant stake16 holders: 

17 (A) 2 representatives of national or re18 gional student advocacy organizations with a 

19 track record of engagement and expertise on 

20 issues related to college costs, consumer protec21 tion, and institutional accountability and an al22 ternate member. 

23 (B) 1 student representative who is attend24 ing an institution of higher education on the 

25 date of the selection and an alternate member. 


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1 (C) 1 member of the Bureau of Consumer 

2 Financial Protection with demonstrated knowl3 edge of student loan borrowing and an alternate 

4 member. 

5 (D) 2 administrative officers from different 

6 types of institutions of higher education and an 

7 alternate member. 

8 (E) 1 higher education researcher and an 

9 alternate member. 

10 (F) 1 State postsecondary education data 

11 system director and an alternate member. 

12 (G) 1 representative from the National 

13 Center for Education Statistics and an alter14 nate member. 

15 (H) 1 representative from the Government 

16 Accountability Office and an alternate member. 

17 (I) 1 representative from the Department 

18 of the Treasury and an alternate member. 

19 (2) FUNCTIONS.—Each member selected under 

20 paragraph (1) shall participate for the purpose of 

21 determining agreement by majority vote on the Com22 mission on the report and its contents described in 

23 subsection (b)(4). Each alternate member shall par24 ticipate for the purpose of determining the majority 

25 vote in the absence of the member. Either the memVerDate Sep 11 2014 23:37 Dec 15, 2014 Jkt 049200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S2993.IS S2993

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1 ber or an alternate member may speak during the 

2 negotiations. In the event that the Commission is 

3 unable to form agreement on the contents of the re4 port by majority vote, the contents of the report 

5 shall be determined by a plurality vote. 

6 (b) STUDY.— 

7 (1) IN GENERAL.—Not later than 270 days 

8 after the date that all members of the Commission 

9 have been selected under subsection (a), the Com10 mission shall complete a study and develop rec11 ommendations for implementation of a new risk12 sharing system for institutions of higher education 

13 that participate in the Federal Direct Loan Program 

14 under part D of title IV of the Higher Education 

15 Act of 1965 (20 U.S.C. 1087a et seq.) through 

16 which institutions would be held financially account17 able for poor student outcomes. 

18 (2) CONTENT OF STUDY.—In conducting the 

19 study required under paragraph (1), the Commission 

20 shall, at a minimum, consider the following issues: 

21 (A) Identifying an annual measure or set 

22 of measures for the risk-sharing system that 

23 would provide the most accurate assessment of 

24 an institution’s level of success or failure at 

25 providing their students with basic educational 


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1 outcomes, such as degree completion, ability to 

2 repay loans made, insured, or guaranteed under 

3 title IV of the Higher Education Act of 1965 

4 (20 U.S.C. 1070 et seq.), post-graduation em5 ployment, and post-graduation earnings. Such 

6 possible measures may include cohort default 

7 rates, loan repayment rates, graduation rates, 

8 graduate earnings, and other measure that the 

9 Commission considers an accurate reflection of 

10 student outcomes, regardless of the feasibility 

11 of access to the data required to implement col12 lection of such measures. 

13 (B) What specific metrics would require 

14 the lowest performing institutions to make an15 nual payments into the risk-sharing system, 

16 and what metrics would exempt institutions 

17 from making an annual risk-sharing payment 

18 based on performance measures that exceeded a 

19 minimum level (which level would be identified 

20 by the Commission). 

21 (C) How the payments for each institution 

22 should be calculated, including whether the use 

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1 centage of loans in default, or any other cal2 culation should be used. 

3 (D) Whether a sliding scale of payments 

4 should be required of institutions based on their 

5 performance on the identified measures. 

6 (E) Any legislative safeguards or mecha7 nisms to ensure that an institution required to 

8 participate in the risk-sharing system would not 

9 pass any prospective costs directly or indirectly 

10 onto students, or limit access to low-income stu11 dents. 

12 (F) How an institution’s level of access to 

13 low-income students (such as measured by the 

14 percentage of students enrolled at the institu15 tion who receive Federal Pell Grants under sub16 part 1 of part A of title IV of the Higher Edu17 cation Act of 1965 (20 U.S.C. 1070a et seq.)) 

18 and affordability (as measured by average net 

19 price) should be considered in the risk-sharing 

20 system. 

21 (G) Specifying a means for the risk-shar22 ing system payments to go primarily towards 

23 students in default, additional aid to low-income 

24 students, or any other form of aid to student 


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1 borrowers most in need, including after degree 

2 completion. 

3 (H) Whether any extraordinary consider4 ation exists that warrants allowing a waiver 

5 process through which a very limited number of 

6 institutions would be eligible to apply for a 

7 waiver from a risk-sharing payment on a yearly 

8 basis, and under what conditions. 

9 (3) OUTSIDE RECOMMENDATIONS.—As part of 

10 the study required under paragraph (1), the Com11 mission shall develop a public process for soliciting 

12 recommendations for the risk-sharing system and 

13 shall consider these recommendations as part of the 

14 study. The Commission shall factor in any financial 

15 or other interests of any submitting party in weigh16 ing and considering such recommendations. 

17 (4) REPORT.— 

18 (A) CONTENT.—Not later than 90 days 

19 after completing the study required under para20 graph (1), the Commission shall issue, by ma21 jority vote, or if unable to achieve a majority 

22 vote, then a plurality vote, a report regarding 

23 its recommendations for a risk-sharing system. 

24 The report shall include the following: 


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1 (i) A description of the Commission’s 

2 findings as to the issues described in para3 graph (2). 

4 (ii) A data analysis using the Com5 mission’s recommended metrics that dem6 onstrates how each institution of higher 

7 education that participates in the Federal 

8 Direct Loan Program under part D of title 

9 IV of the Higher Education Act of 1965 

10 (20 U.S.C. 1087a et seq.) as of the period 

11 of the Commission’s study would fare 

12 under the proposed risk-sharing system, 

13 including projections for the amounts of 

14 payments the lowest performing institu15 tions would have to pay. 

16 (iii) An evaluation of the feasibility 

17 and unintended consequences of imple18 menting the recommended risk-sharing 

19 system, including any legislative or regu20 latory action needed to implement such a 

21 system. 

22 (B) AVAILABILITY.—The report described 

23 in subparagraph (A) shall be— 

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1 cation, Labor, and Pensions of the Senate, 

2 and the Committee on Education and the 

3 Workforce of the House of Representa4 tives; and 

5 (ii) made publicly available. 

6 (c) SECURING INFORMATION AND PRIVACY.— 

7 (1) IN GENERAL.—Subject to paragraph (2), 

8 the Commission may secure directly from any Fed9 eral department or agency such information as the 

10 Commission considers necessary to carry out its du11 ties under this section. The Commission may request 

12 the head of any State or local department or agency 

13 to furnish such information to the Commission. 

14 (2) PRIVACY.—Any Federal department or 

15 agency, State or local department or agency, or in16 stitution of higher education in providing informa17 tion to the Commission under this section shall not 

18 share any personally identifiable information and 

19 shall act in accordance with section 444 of the Gen20 eral Education Provisions Act (20 U.S.C. 1232g, 

21 commonly known as the ‘‘Family Educational Rights 

22 and Privacy Act of 1974’’). 


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1 SEC. 4. CIVIL PENALTIES. 

2 Part G of title IV of the Higher Education Act of 

3 1965 (20 U.S.C. 1088 et seq.) is amended by inserting 

4 after section 489 the following: 

5 ‘‘SEC. 489A. CIVIL PENALTIES AND OTHER REMEDIES. 

6 ‘‘(a) DEFINITIONS.—In this section: 

7 ‘‘(1) SUBSTANTIAL MISREPRESENTATION OR

8 OTHER SERIOUS VIOLATION.—The term ‘substantial 

9 misrepresentation or other serious violation’ means 

10 any of the following: 

11 ‘‘(A) A substantial misrepresentation re12 garding— 

13 ‘‘(i) the nature of the educational pro14 gram of an institution of higher education; 

15 ‘‘(ii) the financial charges of the insti16 tution; 

17 ‘‘(iii) the space availability in a pro18 gram of the institution for which a student 

19 is considering enrollment; 

20 ‘‘(iv) the admission requirements of 

21 the institution; 

22 ‘‘(v) the transferability of credits from 

23 the institution; 

24 ‘‘(vi) whether a program of the insti25 tution meets the necessary standards to 

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1 nations, or obtain certification required as 

2 a precondition for employment, in the 

3 State in which the students reside; 

4 ‘‘(vii) the passage rates of students at 

5 the institution in obtaining certification re6 quirements; 

7 ‘‘(viii) the passage rates of students 

8 who sit for licensing examinations; or 

9 ‘‘(ix) the employability of the grad10 uates of the institution. 

11 ‘‘(B) A knowing and willful misuse of Fed12 eral student aid from any source. 

13 ‘‘(C) A violation of section 487(a)(20). 

14 ‘‘(D) A violation of the default manipula15 tion regulations promulgated by the Secretary 

16 under section 435(m)(3). 

17 ‘‘(E) Failure to comply with the program 

18 review process described in section 498A, in19 cluding any disclosure requirement described in 

20 paragraph (2) or (5) of section 498A(b). 

21 ‘‘(F) A violation of the program integrity 

22 regulations promulgated by the Secretary under 

23 this Act. 


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1 ‘‘(G) A violation of this Act that the Sec2 retary has determined, by regulation, to be a 

3 serious violation for purposes of this section. 

4 ‘‘(2) OFFICER OF AN INSTITUTION OF HIGHER

5 EDUCATION.—The term ‘officer of an institution of 

6 higher education’ includes the president, chief execu7 tive officer, and chief financial officer of an institu8 tion of higher education or their equivalents. 

9 ‘‘(b) SANCTIONS FOR SUBSTANTIAL MISREPRESEN10 TATIONS OR SERIOUS VIOLATIONS.— 

11 ‘‘(1) CIVIL PENALTIES.— 

12 ‘‘(A) IN GENERAL.—The Secretary may 

13 impose a civil penalty upon an eligible institu14 tion upon making a determination, after reason15 able notice and opportunity for a hearing, that 

16 an eligible institution has engaged in a substan17 tial misrepresentation or other serious violation. 

18 ‘‘(B) AMOUNT OF CIVIL PENALTIES.—A 

19 civil penalty imposed for a violation under sub20 paragraph (A) shall be not less than $100,000 

21 or— 

22 ‘‘(i) in the case of a first violation, an 

23 amount equal to the product of $1,000,000 

24 multiplied by the institution’s student de25 fault risk, whichever is larger; 


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1 ‘‘(ii) in the case of a second violation, 

2 an amount equal to the product of 

3 $2,000,000 multiplied by the institution’s 

4 student default risk, whichever is larger; 

5 and 

6 ‘‘(iii) in the case of a third or subse7 quent violation, an amount equal to the 

8 product of $3,000,000 multiplied by the in9 stitution’s student default risk, whichever 

10 is larger. 

11 ‘‘(C) TREATMENT OF MULTIPLE INSTITU12 TIONS.—For the purpose of determining the 

13 number of violations under subparagraph (B), 

14 any violation by a particular institution will ac15 crue against all identification codes used by the 

16 Office of Postsecondary Education to designate 

17 campuses and institutions affiliated with the in18 stitution, and within the period of participation 

19 for the institution, as defined in section 

20 668.13(b) of title 34, Code of Federal Regula21 tions, or any successor regulation. 

22 ‘‘(c) SANCTIONS FOR OTHER VIOLATIONS OF THIS

23 TITLE.—Upon determination, after reasonable notice and 

24 opportunity for a hearing, that an eligible institution has 

25 engaged in a violation of any other provision of this title, 


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1 including the failure to carry out any provision of this 

2 title, that is not a significant misrepresentation or other 

3 serious violation, the Secretary may impose a civil penalty 

4 upon such institution of not more than $100,000 (subject 

5 to such adjustments for inflation as may be prescribed in 

6 regulation) for each such violation. 

7 ‘‘(d) CIVIL PENALTIES AND SANCTIONS FOR OFFI8 CERS OF INSTITUTIONS.—Upon determination, after rea9 sonable notice and an opportunity for a hearing on the 

10 record, that an officer of an institution of higher education 

11 that participates in a program under this title has know12 ingly and willfully, or with gross negligence, violated a pro13 vision of this title, the Secretary may sanction the officer. 

14 Such sanctions may include the following: 

15 ‘‘(1) Prohibiting the institution of higher edu16 cation that has employed the officer of an institution 

17 of higher education and that participates in a pro18 gram under this title, or any other institution of 

19 higher education that participates in a program 

20 under this title, from employing the officer, except 

21 that any such prohibition under this subsection shall 

22 not be for a period of more than 5 years from the 

23 date of the determination of the violation. 

24 ‘‘(2) Assessing a civil penalty against an officer 

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1 ingly and willfully, or with gross negligence, violated 

2 a provision of this title, except that any such civil 

3 penalty under this subsection shall not be greater 

4 than the amount of the officer’s compensation for 

5 each year for which the violations are determined to 

6 have occurred. For purposes of this paragraph, an 

7 officer’s compensation shall include proceeds of any 

8 sales of stock and any incentive-based compensation 

9 (including stock options awarded as compensation) 

10 based on information required to be reported to the 

11 Secretary or any other Federal agency during the 

12 period in which the violations are determined to have 

13 occurred. 

14 ‘‘(e) LIMITATION, SUSPENSION, OR TERMINATION OF

15 ELIGIBILITY STATUS.— 

16 ‘‘(1) IN GENERAL.—Upon determination, after 

17 reasonable notice and opportunity for a hearing, that 

18 an eligible institution has engaged in a violation of 

19 any provision of this title (including the failure to 

20 carry out any provision of this title or any regulation 

21 prescribed under such provision) or a violation of 

22 any applicable special arrangement, agreement, or 

23 limitation, the Secretary may limit, suspend, or ter24 minate the participation in any program under this 


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1 title of an eligible institution, subject to the require2 ments of paragraph (2). 

3 ‘‘(2) SUSPENSION PROCEDURES.—No period of 

4 suspension under this section shall exceed 60 days 

5 unless the institution and the Secretary agree to an 

6 extension or unless limitation or termination pro7 ceedings are initiated by the Secretary within that 

8 period of time. 

9 ‘‘(f) EMERGENCY ACTION.— 

10 ‘‘(1) IN GENERAL.—The Secretary may take an 

11 emergency action against an institution, under which 

12 the Secretary shall, effective on the date on which a 

13 notice and statement of the basis of the action is 

14 mailed to the institution (by registered mail, return 

15 receipt requested), withhold funds from the institu16 tion or its students and withdraw the institution’s 

17 authority to obligate funds under any program 

18 under this title, if the Secretary— 

19 ‘‘(A) receives information, determined by 

20 the Secretary to be reliable, that the institution 

21 is violating any provision of this title, any regu22 lation prescribed under this title, or any appli23 cable special arrangement, agreement, or limita24 tion; 


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1 ‘‘(B) determines that immediate action is 

2 necessary to prevent misuse of Federal funds; 

3 and 

4 ‘‘(C) determines that the likelihood of loss 

5 outweighs the importance of the procedures pre6 scribed in subsection (e) for limitation, suspen7 sion, or termination. 

8 ‘‘(2) TIME LIMITATION.—An emergency action 

9 described in paragraph (1) shall not exceed 30 days 

10 unless limitation, suspension, or termination pro11 ceedings are initiated by the Secretary against the 

12 institution within that period of time. 

13 ‘‘(3) OPPORTUNITY TO SHOW CAUSE.—The Sec14 retary shall provide an institution that is the subject 

15 of an emergency action under this subsection an op16 portunity to show cause, if the institution so re17 quests, that the emergency action is unwarranted 

18 and should be lifted. 

19 ‘‘(g) LIFTING OF SANCTIONS.—Notwithstanding any 

20 other provision of this title, an institution of higher edu21 cation that has been sanctioned by the Secretary under 

22 this section or any other provision of this title may not 

23 have such sanctions lifted until the Secretary has con24 ducted a subsequent program review under section 498A 


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1 and has found the institution to be in compliance with this 

2 title. 

3 ‘‘(h) SINGLE COURSE OF CONDUCT; COMPROMISE

4 AUTHORITY.— 

5 ‘‘(1) SAME COURSE OF CONDUCT.—For pur6 poses of this section, acts and omissions relating to 

7 a single course of conduct shall be treated as a sin8 gle violation. 

9 ‘‘(2) COMPROMISE AUTHORITY.—Any civil pen10 alty under this section may be compromised by the 

11 Secretary. In determining the amount of such pen12 alty, or the amount agreed upon in compromise, the 

13 Secretary shall consider— 

14 ‘‘(A) the appropriateness of the penalty to 

15 the size of the institution of higher education 

16 subject to the determination; and 

17 ‘‘(B) the gravity of the violation, failure, or 

18 misrepresentation. 

19 ‘‘(i) COLLECTION OF PENALTY.—The amount of any 

20 penalty under this section may be deducted from any sums 

21 owing by the United States to the institution charged. 

22 ‘‘(j) DISPOSITION OF AMOUNTS RECOVERED.— 

23 ‘‘(1) IN GENERAL.—Amounts collected under 

24 this section shall be transferred to the Secretary, 


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1 who shall determine the distribution of collected 

2 amounts, in accordance with paragraphs (2) and (3). 

3 ‘‘(2) USE FOR PROGRAM INTEGRITY EFFORTS

4 AND PROGRAM REVIEWS.— 

5 ‘‘(A) IN GENERAL.—For each fiscal year, 

6 an amount equal to not more than 50 percent 

7 of the amounts recovered or collected under this 

8 section— 

9 ‘‘(i) shall be available to the Secretary 

10 to carry out program reviews under section 

11 498A and other efforts by the Secretary 

12 related to program integrity under part H; 

13 and 

14 ‘‘(ii) may be credited, if applicable, for 

15 that purpose by the Secretary to any ap16 propriations and funds that are available 

17 to the Secretary for obligation at the time 

18 of collection. 

19 ‘‘(B) SUPPLEMENT NOT SUPPLANT.— 

20 Amounts made available under subparagraph 

21 (A) shall be used to supplement and not sup22 plant any other amounts available to the Sec23 retary for the purpose described in such sub24 paragraph. 


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1 ‘‘(C) AVAILABILITY FOR FUNDS.—Any 

2 amounts collected under this section that are 

3 made available under subparagraph (A) shall 

4 remain available until expended. 

5 ‘‘(3) USE FOR STUDENT RELIEF FUND.—For 

6 each fiscal year, an amount equal to not less than 

7 50 percent of the amounts recovered or collected 

8 under this section shall be deposited into the Stu9 dent Relief Fund established under subsection (k). 

10 ‘‘(4) REPORT.—The Secretary shall regularly 

11 publish, on the website of the Department, a de12 tailed description that includes— 

13 ‘‘(A) the amount of funds that were dis14 tributed for the purposes described in para15 graph (2) and the amount used for the Student 

16 Relief Fund under paragraph (3); and 

17 ‘‘(B) how funds were distributed among 

18 the purposes described in paragraph (2)(A)(i). 

19 ‘‘(k) STUDENT RELIEF FUND.— 

20 ‘‘(1) ESTABLISHMENT.—The Secretary shall es21 tablish a Student Relief Fund (referred to in this 

22 subsection as the ‘Fund’) that shall be used, subject 

23 to the availability of funds, to provide financial relief 

24 to any student enrolled in an institution of higher 

25 education that— 


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1 ‘‘(A) has failed to comply with an eligi2 bility requirement under section 101 or 102 or 

3 an obligation incurred under the terms of the 

4 program participation agreement under section 

5 487; or 

6 ‘‘(B) has been sanctioned under subsection 

7 (b) or (c). 

8 ‘‘(2) DETERMINATION OF RELIEF.—The Sec9 retary, in consultation with Director of the Bureau 

10 of Consumer Financial Protection— 

11 ‘‘(A) shall determine the manner of relief 

12 to be provided under paragraph (1), which may 

13 include tuition reimbursement or full or partial 

14 loan forgiveness; and 

15 ‘‘(B) may issue regulations regarding how 

16 the amounts in the Fund will be distributed 

17 among students eligible for the funds. 

18 ‘‘(3) TREATMENT AND AVAILABILITY OF

19 FUNDS.— 

20 ‘‘(A) FUNDS THAT ARE NOT GOVERNMENT

21 FUNDS.—Funds obtained by or transferred to 

22 the Fund shall not be construed to be Govern23 ment funds or appropriated monies. 

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1 sion of law, amounts in the Fund shall not be 

2 subject to apportionment for purposes of chap3 ter 15 of title 31, United States Code, or under 

4 any other authority. 

5 ‘‘(C) NO FISCAL YEAR LIMITATION.—Sums 

6 deposited in the Fund shall remain in the Fund 

7 and be available for expenditure under this sub8 section without fiscal year limitation. 

9 ‘‘(4) INVESTMENTS.— 

10 ‘‘(A) AMOUNTS IN FUND MAY BE IN11 VESTED.—The Secretary of Education may re12 quest the Secretary of the Treasury to invest 

13 the portion of the Fund that is not, in the dis14 cretion of the Secretary of Education, required 

15 to meet the current needs of the Fund. 

16 ‘‘(B) ELIGIBLE INVESTMENTS.—Invest17 ments shall be made by the Secretary of the 

18 Treasury in obligations of the United States or 

19 obligations that are guaranteed as to principal 

20 and interest by the United States, with matu21 rities suitable to the needs of the Fund as de22 termined by the Secretary on the record. 

23 ‘‘(C) INTEREST AND PROCEEDS CRED24 ITED.—The interest on, and the proceeds from 


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1 the sale or redemption of, any obligations held 

2 in the Fund shall be credited to the Fund. 

3 ‘‘(5) REGULATIONS.—The Secretary shall pre4 scribe regulations to implement the requirements of 

5 this section within 1 year after the date of enact6 ment of the Students Before Profits Act. 

7 ‘‘(6) AUTHORIZATION OF APPROPRIATIONS.—In 

8 addition to funds derived from financial penalties as9 sessed pursuant to subsection (j), there are author10 ized to be appropriated such sums as may be nec11 essary to carry out this subsection for fiscal year 

12 2015 and each of the 5 succeeding fiscal years. 

13 ‘‘(l) STATE ENFORCEMENT.— 

14 ‘‘(1) IN GENERAL.—Any violation of subsection 

15 (b), including the regulations promulgated under 

16 such subsection, shall be a cause of action enforce17 able by the State, through the attorney general (or 

18 the equivalent thereof) of the State, in any district 

19 court of the United States in that State or in a 

20 State court that is located in that State and that 

21 has jurisdiction over the defendant. The State may 

22 seek any relief provided under paragraph (4)(B) for 

23 such violation, or any remedies otherwise provided 

24 under law. 

25 ‘‘(2) NOTICE REQUIRED.— 


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1 ‘‘(A) IN GENERAL.—Before initiating any 

2 action in a court or other administrative or reg3 ulatory proceeding against any institution of 

4 higher education as authorized by paragraph 

5 (1) to enforce any provision of this subsection, 

6 including any regulation promulgated by the 

7 Secretary under this subsection, a State attor8 ney general shall timely provide a copy of the 

9 complete complaint to be filed and written no10 tice describing such action or proceeding to the 

11 Secretary, except as provided in subparagraph 

12 (B). 

13 ‘‘(B) EMERGENCY ACTION.—If prior notice 

14 is not practicable, the State attorney general 

15 shall provide a copy of the complete complaint 

16 and the notice to the Secretary immediately 

17 upon instituting the action or proceeding. 

18 ‘‘(C) CONTENTS OF NOTICE.—The notifi19 cation required under this paragraph shall, at a 

20 minimum, describe— 

21 ‘‘(i) the identity of the parties; 

22 ‘‘(ii) the alleged facts underlying the 

23 proceeding; and 

24 ‘‘(iii) whether there may be a need to 

25 coordinate the prosecution of the proVerDate Sep 11 2014 23:37 Dec 15, 2014 Jkt 049200 PO 00000 Frm 00025 Fmt 6652 Sfmt 6201 E:\BILLS\S2993.IS S2993

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•S 2993 IS

1 ceeding so as not to interfere with any ac2 tion, including any rulemaking, undertaken 

3 by the Secretary or another Federal agen4 cy. 

5 ‘‘(3) REGULATIONS.—The Secretary shall pre6 scribe regulations to implement the requirements of 

7 this subsection and periodically provide guidance in 

8 order to further coordinate actions with the State at9 torneys general. 

10 ‘‘(4) PRESERVATION OF STATE AUTHORITY.— 

11 ‘‘(A) STATE CLAIMS.—Nothing in this sub12 section shall be construed as altering, limiting, 

13 or affecting the authority of a State attorney 

14 general or any other regulatory or enforcement 

15 agency or authority to bring an action or other 

16 regulatory proceeding arising solely under the 

17 law in effect in that State. 

18 ‘‘(B) RELIEF.— 

19 ‘‘(i) IN GENERAL.—Relief under this 

20 subsection may include, without limita21 tion— 

22 ‘‘(I) rescission or reformation of 

23 contracts; 

24 ‘‘(II) refund of moneys or return 

25 of real property; 


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•S 2993 IS

1 ‘‘(III) restitution; 

2 ‘‘(IV) disgorgement or compensa3 tion for unjust enrichment; 

4 ‘‘(V) payment of damages or 

5 other monetary relief pursuant to the 

6 requirements of paragraph (2); 

7 ‘‘(VI) public notification regard8 ing the violation, including the costs 

9 of notification; and 

10 ‘‘(VII) limits on the activities or 

11 functions of the person. 

12 ‘‘(ii) EXCLUSION.—Relief under this 

13 subsection shall not include the ability to 

14 suspend or terminate the eligibility status 

15 of an institution of higher education for 

16 programs under this title.’’. 

Æ 


smartinez on DSK4TPTVN1PROD with BILLS