II 

109TH CONGRESS 

1ST SESSION S. 925 

To promote youth financial education. 

IN THE SENATE OF THE UNITED STATES 

APRIL 27, 2005 

Mr. CORZINE (for himself, Mr. AKAKA, Ms. STABENOW, Mr. LAUTENBERG, 

and Mr. BAUCUS) introduced the following bill; which was read twice and 

referred to the Committee on Health, Education, Labor, and Pensions 

A BILL 

To promote youth financial education. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. PROMOTING YOUTH FINANCIAL LITERACY. 

4 Title IV of the Elementary and Secondary Education 

5 Act of 1965 (20 U.S.C. 7101 et seq.) is amended by add6 ing at the end the following: 

7 ‘‘PART D—PROMOTING YOUTH FINANCIAL 

8 LITERACY 

9 ‘‘SEC. 4401. SHORT TITLE AND FINDINGS. 

10 ‘‘(a) SHORT TITLE.—This part may be cited as the 

11 ‘Youth Financial Education Act’. 
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1 ‘‘(b) FINDINGS.—Congress finds the following: 

2 ‘‘(1) In order to succeed in our dynamic Amer3 ican economy, young people must obtain the skills, 

4 knowledge, and experience necessary to manage their 

5 personal finances and obtain general financial lit6 eracy. All young adults should have the educational 

7 tools necessary to make informed financial decisions. 

8 ‘‘(2) Despite the critical importance of financial 

9 literacy to young people, the average student who 

10 graduates from high school lacks basic skills in the 

11 management of personal financial affairs. A nation12 wide survey conducted in 2004 by the Jump$tart 

13 Coalition for Personal Financial Literacy examined 

14 the financial knowledge of 4,074 12th graders. On 

15 average, survey respondents answered only 52 per16 cent of the questions correctly. This figure is up only 

17 slightly from the 50 percent average score in 2002. 

18 ‘‘(3) An evaluation by the National Endowment 

19 for Financial Education High School Financial 

20 Planning Program undertaken jointly with the 

21 United States Department of Agriculture Coopera22 tive State Research, Education, and Extension Serv23 ice demonstrates that as little as 10 hours of class24 room instruction can impart substantial knowledge 
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1 and affect significant change in how teens handle 

2 their money. 

3 ‘‘(4) State educational leaders have recognized 

4 the importance of providing a basic financial edu5 cation to students in kindergarten through grade 12 

6 by integrating financial education into State edu7 cational standards, but by 2004, only 7 States re8 quired students to complete a course that covered 

9 personal finance before graduating from high school. 

10 ‘‘(5) Teacher training and professional develop11 ment are critical to achieving youth financial lit12 eracy. Teachers should be given the tools they need 

13 to educate our Nation’s youth on personal finance 

14 and economics. 

15 ‘‘(6) Personal financial education helps prepare 

16 students for the workforce and for financial inde17 pendence by developing their sense of individual re18 sponsibility, improving their life skills, and providing 

19 them with a thorough understanding of consumer 

20 economics that will benefit them for their entire 

21 lives. 

22 ‘‘(7) Financial education integrates instruction 

23 in valuable life skills with instruction in economics, 

24 including income and taxes, money management, in-
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1 vestment and spending, and the importance of per2 sonal savings. 

3 ‘‘(8) The consumers and investors of tomorrow 

4 are in our schools today. The teaching of personal 

5 finance should be encouraged at all levels of our Na6 tion’s educational system, from kindergarten 

7 through grade 12. 

8 ‘‘SEC. 4402. STATE GRANT PROGRAM. 

9 ‘‘(a) PROGRAM AUTHORIZED.—The Secretary is au10 thorized to provide grants to State educational agencies 

11 to develop and integrate youth financial education pro12 grams for students in elementary schools and secondary 

13 schools. 

14 ‘‘(b) STATE PLAN.— 

15 ‘‘(1) APPROVED STATE PLAN REQUIRED.—To 

16 be eligible to receive a grant under this section, a 

17 State educational agency shall submit an application 

18 that includes a State plan, described in paragraph 

19 (2), that is approved by the Secretary. 

20 ‘‘(2) STATE PLAN CONTENTS.—The State plan 

21 referred to in paragraph (1) shall include— 

22 ‘‘(A) a description of how the State edu23 cational agency will use grant funds; 

24 ‘‘(B) a description of how the programs 

25 supported by a grant will be coordinated with 
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1 other relevant Federal, State, regional, and local 

2 programs; and 

3 ‘‘(C) a description of how the State edu4 cational agency will evaluate program perform5 ance. 

6 ‘‘(c) ALLOCATION OF FUNDS.— 

7 ‘‘(1) ALLOCATION FACTORS.—Except as other8 wise provided in paragraph (2), the Secretary shall 

9 allocate the amounts made available to carry out 

10 this section pursuant to subsection (a) to each State 

11 according to the relative populations in all the States 

12 of students in kindergarten through grade 12, as de13 termined by the Secretary based on the most recent 

14 satisfactory data. 

15 ‘‘(2) MINIMUM ALLOCATION.—Subject to the 

16 availability of appropriations and notwithstanding 

17 paragraph (1), a State that has submitted a plan 

18 under subsection (b) that is approved by the Sec19 retary shall be allocated an amount that is not less 

20 than $500,000 for a fiscal year. 

21 ‘‘(3) REALLOCATION.—In any fiscal year an al22 location under this subsection— 

23 ‘‘(A) for a State that has not submitted a 

24 plan under subsection (b); or 
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1 ‘‘(B) for a State whose plan submitted 

2 under subsection (b) has been disapproved by 

3 the Secretary; 

4 shall be reallocated to States with approved plans 

5 under this section in accordance with paragraph (1). 

6 ‘‘(d) USE OF GRANT FUNDS.— 

7 ‘‘(1) REQUIRED USES.—A grant made to a 

8 State educational agency under this part shall be 

9 used— 

10 ‘‘(A) to provide funds to local educational 

11 agencies and public schools to carry out finan12 cial education programs for students in kinder13 garten through grade 12 based on the concept 

14 of achieving financial literacy through the 

15 teaching of personal financial management 

16 skills and the basic principles involved with 

17 earning, spending, saving, and investing; 

18 ‘‘(B) to carry out professional development 

19 programs to prepare teachers and administra20 tors for financial education; and 

21 ‘‘(C) to monitor and evaluate programs 

22 supported under subparagraphs (A) and (B). 

23 ‘‘(2) LIMITATION ON ADMINISTRATIVE COSTS.— 

24 A State educational agency receiving a grant under 

25 subsection (a) may use not more than 4 percent of 
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1 the total amount of the grant in each fiscal year for 

2 the administrative costs of carrying out this section. 

3 ‘‘(e) REPORT TO THE SECRETARY.—Each State edu4 cational agency receiving a grant under this section shall 

5 transmit a report to the Secretary with respect to each 

6 fiscal year for which a grant is received. The report shall 

7 describe the programs supported by the grant and the re8 sults of the State educational agency’s monitoring and 

9 evaluation of such programs. 

10 ‘‘SEC. 4403. CLEARINGHOUSE. 

11 ‘‘(a) AUTHORITY.—Subject to the availability of ap12 propriations, the Secretary shall make a grant to, or exe13 cute a contract with, an eligible entity with substantial ex14 perience in the field of financial education, such as the 

15 Jump$tart Coalition for Personal Financial Literacy, to 

16 establish, operate, and maintain a national clearinghouse 

17 (in this part referred to as the ‘Clearinghouse’) for in18 structional materials and information regarding model fi19 nancial education programs and best practices. 

20 ‘‘(b) ELIGIBLE ENTITY.—In this section, the term 

21 ‘eligible entity’ means a national nonprofit organization 

22 with a proven record of— 

23 ‘‘(1) cataloging youth financial literacy mate24 rials; and 
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1 ‘‘(2) providing support services and materials to 

2 schools and other organizations that work to pro3 mote youth financial literacy. 

4 ‘‘(c) APPLICATION.—An eligible entity desiring to es5 tablish, operate, and maintain the Clearinghouse shall 

6 submit an application to the Secretary at such time, in 

7 such manner, and accompanied by such information, as 

8 the Secretary may reasonably require. 

9 ‘‘(d) BASIS AND TERM.—The Secretary shall make 

10 the grant or contract authorized under subsection (a) on 

11 a competitive, merit basis for a term of 5 years. 

12 ‘‘(e) USE OF FUNDS.—The Clearinghouse shall use 

13 the funds provided under a grant or contract made under 

14 subsection (a)— 

15 ‘‘(1) to maintain a repository of instructional 

16 materials and related information regarding finan17 cial education programs for elementary schools and 

18 secondary schools, including kindergartens, for use 

19 by States, localities, and the general public; 

20 ‘‘(2) to disseminate to States, localities, and the 

21 general public, through electronic and other means, 

22 instructional materials and related information re23 garding financial education programs for elementary 

24 schools and secondary schools, including kinder25 gartens; and 
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1 ‘‘(3) to the extent that resources allow, to pro2 vide technical assistance to States, localities, and the 

3 general public on the design, establishment, and im4 plementation of financial education programs for ele5 mentary schools and secondary schools, including 

6 kindergartens. 

7 ‘‘(f) CONSULTATION.—The chief executive officer of 

8 the eligible entity selected to establish and operate the 

9 Clearinghouse shall consult with the Department of the 

10 Treasury and the Securities Exchange Commission with 

11 respect to its activities under subsection (e). 

12 ‘‘(g) SUBMISSION TO CLEARINGHOUSE.—Each Fed13 eral agency or department that develops financial edu14 cation programs and instructional materials for such pro15 grams shall submit to the Clearinghouse information on 

16 the programs and copies of the materials. 

17 ‘‘(h) APPLICATION OF COPYRIGHT LAWS.—In car18 rying out this section the Clearinghouse shall comply with 

19 the provisions of title 17 of the United States Code. 

20 ‘‘SEC. 4404. EVALUATION AND REPORT. 

21 ‘‘(a) PERFORMANCE MEASURES.—The Secretary 

22 shall develop measures to evaluate the performance of pro23 grams assisted under sections 4402 and 4403. 

24 ‘‘(b) EVALUATION ACCORDING TO PERFORMANCE

25 MEASURES.—Applying the performance measures devel-
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1 oped under subsection (a), the Secretary shall evaluate 

2 programs assisted under sections 4402 and 4403— 

3 ‘‘(1) to judge their performance and effective4 ness; 

5 ‘‘(2) to identify which of the programs rep6 resent the best practices of entities developing finan7 cial education programs for students in kindergarten 

8 through grade 12; and 

9 ‘‘(3) to identify which of the programs may be 

10 replicated and used to provide technical assistance to 

11 States, localities, and the general public. 

12 ‘‘(c) REPORT.—For each fiscal year for which there 

13 are appropriations under section 4407(a), the Secretary 

14 shall transmit a report to Congress describing the status 

15 of the implementation of this part. The report shall in16 clude the results of the evaluation required under sub17 section (b) and a description of the programs supported 

18 under section 4402. 

19 ‘‘SEC. 4405. DEFINITIONS. 

20 ‘‘In this part: 

21 ‘‘(1) FINANCIAL EDUCATION.—The term ‘finan22 cial education’ means educational activities and ex23 periences, planned and supervised by qualified teach24 ers, that enable students to understand basic eco25 nomic and consumer principles, acquire the skills 
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1 and knowledge necessary to manage personal and 

2 household finances, and develop a range of com3 petencies that will enable the students to become re4 sponsible consumers in today’s complex economy. 

5 ‘‘(2) QUALIFIED TEACHER.—The term ‘quali6 fied teacher’ means a teacher who holds a valid 

7 teaching certification or is considered to be qualified 

8 by the State educational agency in the State in 

9 which the teacher works. 

10 ‘‘SEC. 4406. PROHIBITION. 

11 ‘‘Nothing in this part shall be construed to authorize 

12 an officer or employee of the Federal Government to man13 date, direct, or control a State, local educational agency, 

14 or school’s specific instructional content, curriculum, or 

15 program of instruction, as a condition of eligibility to re16 ceive funds under this part. 

17 ‘‘SEC. 4407. AUTHORIZATION OF APPROPRIATIONS. 

18 ‘‘(a) AUTHORIZATION.—For the purposes of carrying 

19 out this part, there are authorized to be appropriated 

20 $100,000,000 for each of the fiscal years 2006 through 

21 2010. 

22 ‘‘(b) LIMITATION ON FUNDS FOR CLEARING23 HOUSE.—The Secretary may use not less than 2 percent 

24 and not more than 5 percent of amounts appropriated 
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1 under subsection (a) for each fiscal year to carry out sec2 tion 4403. 

3 ‘‘(c) LIMITATION ON FUNDS FOR SECRETARY EVAL4 UATION.—The Secretary may use not more than $200,000 

5 from the amounts appropriated under subsection (a) for 

6 each fiscal year to carry out subsections (a) and (b) of 

7 section 4404. 

8 ‘‘(d) LIMITATION ON ADMINISTRATIVE COSTS.—Ex9 cept as necessary to carry out subsections (a) and (b) of 

10 section 4404 using amounts described in subsection (c) of 

11 this section, the Secretary shall not use any portion of the 

12 amounts appropriated under subsection (a) for the costs 

13 of administering this part.’’. 

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