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[Congressional Bills 114th Congress]
[From the U.S. Government Publishing Office]
[S. 396 Introduced in Senate (IS)]

114th CONGRESS
  1st Session
                                 S. 396

     To establish the Proprietary Education Oversight Coordination 
                               Committee.

_______________________________________________________________________

                   IN THE SENATE OF THE UNITED STATES

                            February 5, 2015

  Mr. Durbin introduced the following bill; which was read twice and 
  referred to the Committee on Health, Education, Labor, and Pensions

_______________________________________________________________________

                                 A BILL

 
     To establish the Proprietary Education Oversight Coordination 
                               Committee.

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

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Proprietary Education Oversight 
Coordination Improvement Act''.

SEC. 2. DEFINITIONS.

    In this Act:
            (1) Executive officer.--The term ``executive officer'', 
        with respect to a proprietary institution of higher education 
        that is a publicly traded corporation, means--
                    (A) the president of such corporation;
                    (B) a vice president of such corporation who is in 
                charge of a principal business unit, division, or 
                function of such corporation, such as sales, 
                administration, or finance; or
                    (C) any other officer or person who performs a 
                policy making function for such corporation.
            (2) Federal education assistance.--The term ``Federal 
        education assistance'' means any Federal financial assistance 
        provided under any Federal law through a grant, a contract, a 
        subsidy, a loan, a guarantee, an insurance, or any other means 
        to a proprietary institution of higher education, including 
        Federal financial assistance that is disbursed or delivered to 
        such institution, on behalf of a student, or to a student to be 
        used to attend such institution, except that such term shall 
        not include any monthly housing stipend provided under chapter 
        33 of title 38, United States Code.
            (3) Private education loan.--The term ``private education 
        loan''--
                    (A) means a loan provided by a private educational 
                lender (as defined in section 140(a) of the Truth in 
                Lending Act (15 U.S.C. 1650(a))) that--
                            (i) is not made, insured, or guaranteed 
                        under title IV of the Higher Education Act of 
                        1965 (20 U.S.C. 1070 et seq.);
                            (ii) is issued expressly for postsecondary 
                        educational expenses to a borrower, regardless 
                        of whether the loan is provided through the 
                        educational institution that the subject 
                        student attends or directly to the borrower 
                        from the private educational lender (as so 
                        defined); and
                            (iii) is not made, insured, or guaranteed 
                        under title VII or title VIII of the Public 
                        Health Service Act (42 U.S.C. 292 et seq. and 
                        296 et seq.); and
                    (B) does not include an extension of credit under 
                an open end consumer credit plan, a reverse mortgage 
                transaction, a residential mortgage transaction, or any 
                other loan that is secured by real property or a 
                dwelling.
            (4) Proprietary institution of higher education.--The term 
        ``proprietary institution of higher education'' has the meaning 
        given the term in section 102(b) of the Higher Education Act of 
        1965 (20 U.S.C. 1002(b)).
            (5) Recruiting and marketing activities.--
                    (A) In general.--Except as provided in subparagraph 
                (B), the term ``recruiting and marketing activities'' 
                means activities that consist of the following:
                            (i) Advertising and promotion activities, 
                        including paid announcements in newspapers, 
                        magazines, radio, television, billboards, 
                        electronic media, naming rights, or any other 
                        public medium of communication, including 
                        paying for displays or promotions at job fairs, 
                        military installations, or college recruiting 
                        events.
                            (ii) Efforts to identify and attract 
                        prospective students, either directly or 
                        through a contractor or other third party, 
                        including contact concerning a prospective 
                        student's potential enrollment or application 
                        for a grant, a loan, or work assistance under 
                        title IV of the Higher Education Act of 1965 
                        (20 U.S.C. 1070 et seq.) or participation in 
                        preadmission or advising activities, 
                        including--
                                    (I) paying employees responsible 
                                for overseeing enrollment and for 
                                contacting potential students in-
                                person, by phone, by email, or by other 
                                internet communications regarding 
                                enrollment; and
                                    (II) soliciting an individual to 
                                provide contact information to an 
                                institution of higher education, 
                                including through websites established 
                                for such purpose and funds paid to 
                                third parties for such purpose.
                            (iii) Such other activities as the 
                        Secretary of Education may prescribe, including 
                        paying for promotion or sponsorship of 
                        education or military-related associations.
                    (B) Exceptions.--Any activity that is required as a 
                condition of receipt of funds by an institution under 
                title IV of the Higher Education Act of 1965 (20 U.S.C. 
                1070 et seq.), is specifically authorized under such 
                title, or is otherwise specified by the Secretary of 
                Education, shall not be considered to be a recruiting 
                and marketing activity under subparagraph (A).
            (6) State approval agency.--The term ``State approval 
        agency'' means any State agency that determines whether an 
        institution of higher education is legally authorized within 
        such State to provide a program of education beyond secondary 
        education.
            (7) Veterans service organization.--The term ``veterans 
        service organization'' means an organization recognized by the 
        Secretary of Veterans Affairs for the representation of 
        veterans under section 5902 of title 38, United States Code.

SEC. 3. ESTABLISHMENT OF COMMITTEE.

    (a) Establishment.--There is established a committee to be known as 
the ``Proprietary Education Oversight Coordination Committee'' 
(referred to in this Act as the ``Committee'') and to be composed of 
the head (or the designee of such head) of each of the following 
Federal entities:
            (1) The Department of Education.
            (2) The Consumer Financial Protection Bureau.
            (3) The Department of Justice.
            (4) The Securities and Exchange Commission.
            (5) The Department of Defense.
            (6) The Department of Veterans Affairs.
            (7) The Federal Trade Commission.
            (8) The Department of Labor.
            (9) The Internal Revenue Service.
            (10) At the discretion of the President, any other relevant 
        Federal agency or department.
    (b) Purposes.--The Committee shall have the following purposes:
            (1) Coordinate Federal oversight of proprietary 
        institutions of higher education to--
                    (A) improve enforcement of applicable Federal laws 
                and regulations;
                    (B) increase accountability of proprietary 
                institutions of higher education to students and 
                taxpayers; and
                    (C) ensure the promotion of quality education 
                programs.
            (2) Coordinate Federal activities to protect students from 
        unfair, deceptive, abusive, unethical, fraudulent, or predatory 
        practices, policies, or procedures of proprietary institutions 
        of higher education.
            (3) Encourage information sharing among agencies related to 
        Federal investigations, audits, or inquiries of proprietary 
        institutions of higher education.
            (4) Increase coordination and cooperation between Federal 
        and State agencies, including State Attorneys General and State 
        approval agencies, with respect to improving oversight and 
        accountability of proprietary institutions of higher education.
            (5) Develop best practices and consistency among Federal 
        and State agencies in the dissemination of consumer information 
        regarding proprietary institutions of higher education to 
        ensure that students, parents, and other stakeholders have easy 
        access to such information.
    (c) Membership.--
            (1) Designees.--For any designee described in subsection 
        (a), the head of the member entity shall appoint a high-level 
        official who exercises significant decision making authority 
        for the oversight or investigatory activities and 
        responsibilities related to proprietary institutions of higher 
        education of the respective Federal entity of such head.
            (2) Chairperson.--The Secretary of Education or the 
        designee of such Secretary shall serve as the Chairperson of 
        the Committee.
            (3) Committee support.--The head of each entity described 
        in subsection (a) shall ensure appropriate staff and officials 
        of such entity are available to support the Committee-related 
        work of such entity.

SEC. 4. MEETINGS.

    (a) Committee Meetings.--The members of the Committee shall meet 
regularly, but not less than once during each quarter of each fiscal 
year, to carry out the purposes described in section 3(b).
    (b) Meetings With State Agencies and Stakeholders.--The Committee 
shall meet not less than once each fiscal year, and shall otherwise 
interact regularly, with State Attorneys General, State approval 
agencies, veterans service organizations, and consumer advocates to 
carry out the purposes described in section 3(b).

SEC. 5. REPORT.

    (a) In General.--The Committee shall submit a report each year to 
the Committee on Health, Education, Labor, and Pensions of the Senate, 
the Committee on Education and the Workforce of the House of 
Representatives, and any other committee of Congress that the Committee 
determines appropriate.
    (b) Public Access.--The report described in subsection (a) shall be 
made available to the public in a manner that is easily accessible to 
parents, students, and other stakeholders, in accordance with the best 
practices developed under section 3(b)(5).
    (c) Contents.--
            (1) In general.--The report shall include--
                    (A) an accounting of any action (as defined in 
                paragraph (3)) taken by the Federal Government, any 
                member entity of the Committee, or a State--
                            (i) to enforce Federal or State laws and 
                        regulations applicable to proprietary 
                        institutions of higher education;
                            (ii) to hold proprietary institutions of 
                        higher education accountable to students and 
                        taxpayers; and
                            (iii) to promote quality education 
                        programs;
                    (B) a summary of complaints against each 
                proprietary institution of higher education received by 
                any member entity of the Committee;
                    (C) the data described in paragraph (2) and any 
                other data relevant to proprietary institutions of 
                higher education that the Committee determines 
                appropriate; and
                    (D) recommendations of the Committee for such 
                legislative and administrative actions as the Committee 
                determines are necessary to--
                            (i) improve enforcement of applicable 
                        Federal laws;
                            (ii) increase accountability of proprietary 
                        institutions of higher education to students 
                        and taxpayers; and
                            (iii) ensure the promotion of quality 
                        education programs.
            (2) Data.--
                    (A) Industry-wide data.--The report shall include 
                data on all proprietary institutions of higher 
                education that consists of information regarding--
                            (i) the total amount of Federal education 
                        assistance that proprietary institutions of 
                        higher education received for the previous 
                        academic year, and the percentage of the total 
                        amount of Federal education assistance provided 
                        to institutions of higher education (as defined 
                        in section 102 of the Higher Education Act of 
                        1965 (20 U.S.C. 1002)) for such previous 
                        academic year that reflects such total amount 
                        of Federal education assistance provided to 
                        proprietary institutions of higher education 
                        for such previous academic year;
                            (ii) the total amount of Federal education 
                        assistance that proprietary institutions of 
                        higher education received for the previous 
                        academic year, disaggregated by--
                                    (I) educational assistance in the 
                                form of a loan provided under title IV 
                                of the Higher Education Act of 1965 (20 
                                U.S.C. 1070 et seq.);
                                    (II) educational assistance in the 
                                form of a grant provided under title IV 
                                of the Higher Education Act of 1965 (20 
                                U.S.C. 1070 et seq.);
                                    (III) educational assistance 
                                provided under chapter 33 of title 38, 
                                United States Code;
                                    (IV) assistance for tuition and 
                                expenses under section 2007 of title 
                                10, United States Code;
                                    (V) assistance provided under 
                                section 1784a of title 10, United 
                                States Code; and
                                    (VI) Federal education assistance 
                                not described in subclauses (I) through 
                                (V);
                            (iii) the percentage of the total amount of 
                        Federal education assistance provided to 
                        institutions of higher education (as defined in 
                        section 102 of the Higher Education Act of 1965 
                        (20 U.S.C. 1002)) for such previous academic 
                        year for each of the programs described in 
                        subclauses (I) through (VI) of clause (ii) that 
                        reflects such total amount of Federal education 
                        assistance provided to proprietary institutions 
                        of higher education for such previous academic 
                        year for each of such programs;
                            (iv) the average retention and graduation 
                        rates for students pursuing a degree at 
                        proprietary institutions of higher education;
                            (v) the average cohort default rate (as 
                        defined in section 435(m) of the Higher 
                        Education Act of 1965 (20 U.S.C. 1085(m)) for 
                        proprietary institutions of higher education, 
                        and an annual list of cohort default rates (as 
                        so defined) for all proprietary institutions of 
                        higher education;
                            (vi) for careers requiring the passage of a 
                        licensing examination--
                                    (I) the passage rate of individuals 
                                who attended a proprietary institution 
                                of higher education taking such 
                                examination to pursue such a career; 
                                and
                                    (II) the passage rate of all 
                                individuals taking such exam to pursue 
                                such a career; and
                            (vii) the use of private education loans at 
                        proprietary institutions of higher education 
                        that includes--
                                    (I) an estimate of the total number 
                                of such loans; and
                                    (II) information on the average 
                                debt, default rate, and interest rate 
                                of such loans.
                    (B) Data on publicly traded corporations.--
                            (i) In general.--The report shall include 
                        data on proprietary institutions of higher 
                        education that are publicly traded 
                        corporations, consisting of information on--
                                    (I) any pre-tax profit of such 
                                proprietary institutions of higher 
                                education--
                                            (aa) reported as a total 
                                        amount and an average percent 
                                        of revenue for all such 
                                        proprietary institutions of 
                                        higher education; and
                                            (bb) reported for each such 
                                        proprietary institution of 
                                        higher education;
                                    (II) revenue for such proprietary 
                                institutions of higher education spent 
                                on recruiting and marketing activities, 
                                student instruction, and student 
                                support services, reported--
                                            (aa) as a total amount and 
                                        an average percent of revenue 
                                        for all such proprietary 
                                        institutions of higher 
                                        education; and
                                            (bb) for each such 
                                        proprietary institution of 
                                        higher education;
                                    (III) total compensation packages 
                                of the executive officers of each such 
                                proprietary institution of higher 
                                education;
                                    (IV) a list of institutional loan 
                                programs offered by each such 
                                proprietary institution of higher 
                                education that includes information on 
                                the default and interest rates of such 
                                programs; and
                                    (V) the data described in clauses 
                                (ii) and (iii).
                            (ii) Disaggregated by ownership.--The 
                        report shall include data on proprietary 
                        institutions of higher education that are 
                        publicly traded corporations, disaggregated by 
                        corporate or parent entity, brand name, and 
                        campus, consisting of--
                                    (I) the total cost of attendance 
                                for each program at each such 
                                proprietary institution of higher 
                                education, and information comparing 
                                such total cost for each such program 
                                to--
                                            (aa) the total cost of 
                                        attendance for each program at 
                                        each public institution of 
                                        higher education; and
                                            (bb) the average total cost 
                                        of attendance for each program 
                                        at all institutions of higher 
                                        education, including such 
                                        institutions that are public 
                                        and such institutions that are 
                                        private;
                                    (II) total enrollment, 
                                disaggregated by--
                                            (aa) individuals enrolled 
                                        in programs taken online; and
                                            (bb) individuals enrolled 
                                        in programs that are not taken 
                                        online;
                                    (III) the average retention and 
                                graduation rates for students pursuing 
                                a degree at such proprietary 
                                institutions of higher education;
                                    (IV) the percentage of students 
                                enrolled in such proprietary 
                                institutions of higher education who 
                                complete a program of such an 
                                institution within--
                                            (aa) the standard period of 
                                        completion for such program; 
                                        and
                                            (bb) a period that is 150 
                                        percent of such standard period 
                                        of completion;
                                    (V) the total cost of attendance 
                                for each program at such proprietary 
                                institutions of higher education;
                                    (VI) the average cohort default 
                                rate, as defined in section 435(m) of 
                                the Higher Education Act of 1965 (20 
                                U.S.C. 1085(m)), for such proprietary 
                                institutions of higher education, and 
                                an annual list of cohort default rates 
                                (as so defined) for all proprietary 
                                institutions of higher education;
                                    (VII) the median educational debt 
                                incurred by students who complete a 
                                program at such a proprietary 
                                institution of higher education;
                                    (VIII) the median educational debt 
                                incurred by students who start but do 
                                not complete a program at such a 
                                proprietary institution of higher 
                                education;
                                    (IX) the job placement rate for 
                                students who complete a program at such 
                                a proprietary institution of higher 
                                education and the type of employment 
                                obtained by such students;
                                    (X) for careers requiring the 
                                passage of a licensing examination, the 
                                rate of individuals who attended such a 
                                proprietary institution of higher 
                                education and passed such an 
                                examination; and
                                    (XI) the number of complaints from 
                                students enrolled in such proprietary 
                                institutions of higher education who 
                                have submitted a complaint to any 
                                member entity of the Committee.
                            (iii) Department of defense and veterans 
                        affairs assistance.--
                                    (I) In general.--To the extent 
                                practicable, the report shall provide 
                                information on the data described in 
                                clause (ii) for individuals using, to 
                                pay for the costs of attending such a 
                                proprietary institution of higher 
                                education, Federal education assistance 
                                provided under--
                                            (aa) chapter 33 of title 
                                        38, United States Code;
                                            (bb) section 2007 of title 
                                        10, United States Code; and
                                            (cc) section 1784a of title 
                                        10, United States Code.
                                    (II) Revenue.--The report shall 
                                provide information on the revenue of 
                                proprietary institutions of higher 
                                education that are publicly traded 
                                corporations that is derived from the 
                                Federal education assistance described 
                                in subclause (I).
                    (C) Comparison data.--To the extent practicable, 
                the report shall provide information comparing the data 
                described in subparagraph (B) for proprietary 
                institutions of higher education that are publicly 
                traded corporations with such data for public 
                institutions of higher education disaggregated by 
                State.
            (3) Accounting of any action.--For the purposes of 
        paragraph (1)(A), the term ``any action'' shall include--
                    (A) a complaint filed by a Federal or State agency 
                in a local, State, Federal, or tribal court;
                    (B) an administrative proceeding by a Federal or 
                State agency involving noncompliance of any applicable 
                law or regulation; or
                    (C) any other review, audit, or administrative 
                process by any Federal or State agency that results in 
                a penalty, suspension, or termination from any Federal 
                or State program.

SEC. 6. FOR-PROFIT COLLEGE WARNING LIST FOR PARENTS AND STUDENTS.

    (a) In General.--Each academic year, the Committee shall publish a 
list to be known as the ``For-Profit College Warning List for Parents 
and Students'' to be comprised of proprietary institutions of higher 
education--
            (1) that have engaged in illegal activity during the 
        previous academic year as determined by a Federal or State 
        court;
            (2) that have entered into a settlement resulting in a 
        monetary payment;
            (3) that have had any higher education program withdrawn or 
        suspended; or
            (4) for which the Committee has sufficient evidence of 
        widespread or systemic unfair, deceptive, abusive, unethical, 
        fraudulent, or predatory practices, policies, or procedures 
        that pose a threat to the academic success, financial security, 
        or general best interest of students.
    (b) Determinations.--In making a determination pursuant to 
subsection (a)(4), the Committee may consider evidence that includes 
the following:
            (1) Any consumer complaint collected by any member entity 
        of the Committee.
            (2) Any complaint filed by a Federal or State agency in a 
        Federal, State, local, or tribal court.
            (3) Any administrative proceeding by a Federal or State 
        agency involving noncompliance of any applicable law or 
        regulation.
            (4) Any other review, audit, or administrative process by 
        any Federal or State agency that results in a penalty, 
        suspension, or termination from any Federal or State program.
            (5) Data or information submitted by a proprietary 
        institution of higher education to any accrediting agency or 
        association recognized by the Secretary of Education pursuant 
        to section 496 of the Higher Education Act of 1965 (20 U.S.C. 
        1099b) or the findings or adverse actions of any such 
        accrediting agency or association.
            (6) Information submitted by a proprietary institution of 
        higher education to any member entity of the Committee.
            (7) Any other evidence that the Committee determines 
        relevant in making a determination pursuant to subsection 
        (a)(4).
    (c) Publication.--Not later than July 1 of each fiscal year, the 
Committee shall publish the list under subsection (a) prominently and 
in a manner that is easily accessible to parents, students, and other 
stakeholders, in accordance with any best practices developed under 
section 3(b)(5).
                                 <all>
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