IIB 
111TH CONGRESS 
1ST SESSION H. R. 3221 
IN THE SENATE OF THE UNITED STATES 
SEPTEMBER 21, 2009 
Received 
SEPTEMBER 22, 2009 
Read twice and referred to the Committee on Health, Education, Labor, and 
Pensions 
AN ACT 
To amend the Higher Education Act of 1965, and for other 
purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
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SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Student Aid and Fiscal 
Responsibility Act of 2009’’. 
SEC. 2. TABLE OF CONTENTS. 
The table of contents is as follows: 
Sec. 1. Short title. 
Sec. 2. Table of contents. 
Sec. 3. References. 
Sec. 4. Prohibition on earmarks. 
Sec. 5. Use of savings for debt reduction. 
TITLE I—INVESTING IN STUDENTS AND FAMILIES 
Subtitle A—Increasing College Access and Completion 
Sec. 101. Federal Pell Grants. 
Sec. 102. College Access and Completion Innovation Fund. 
Sec. 103. Investment in historically Black colleges and universities and other 
minority-serving institutions. 
Sec. 104. Investment in cooperative education. 
Sec. 105. Loan forgiveness for servicemembers activated for duty. 
Sec. 106. Veterans Resource Officer Grants. 
Sec. 107. Officer Daniel Faulkner Children of Fallen Heroes Scholarship. 
Sec. 108. Teacher Excellence. 
Subtitle B—Student Financial Aid Form Simplification 
Sec. 121. General effective date. 
Sec. 122. Treatment of assets in need analysis. 
Sec. 123. Changes to total income; aid eligibility. 
TITLE II—STUDENT LOAN REFORM 
Subtitle A—Stafford Loan Reform 
Sec. 201. Federal Family Education Loan appropriations. 
Sec. 202. Scope and duration of Federal loan insurance program. 
Sec. 203. Applicable interest rates. 
Sec. 204. Federal payments to reduce student interest costs. 
Sec. 205. Federal PLUS Loans. 
Sec. 206. Federal Consolidation Loan. 
Sec. 207. Unsubsidized Stafford loans for middle-income borrowers. 
Sec. 208. Loan repayment for civil legal assistance attorneys. 
Sec. 209. Special allowances. 
Sec. 210. Revised special allowance calculation. 
Sec. 211. Origination of Direct Loans at institutions located outside the United 
States. 
Sec. 212. Agreements with institutions. 
Sec. 213. Terms and conditions of loans. 
Sec. 214. Contracts. 
Sec. 215. Interest rates. 
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Sec. 216. Technical assistance to institutions of higher education. 
Sec. 217. Outreach Efforts. 
Subtitle B—Perkins Loan Reform 
Sec. 221. Federal Direct Perkins Loans terms and conditions. 
Sec. 222. Authorization of appropriations. 
Sec. 223. Allocation of funds. 
Sec. 224. Federal Direct Perkins Loan allocation. 
Sec. 225. Agreements with institutions of higher education. 
Sec. 226. Student loan information by eligible institutions. 
Sec. 227. Terms of loans. 
Sec. 228. Distribution of assets from student loan funds. 
Sec. 229. Implementation of non-title IV revenue requirement. 
Sec. 230. Administrative expenses. 
TITLE III—MODERNIZATION, RENOVATION, AND REPAIR 
Subtitle A—Elementary and Secondary Education 
Sec. 301. Definitions. 
CHAPTER 1—GRANTS FOR MODERNIZATION, RENOVATION, OR REPAIR OF 
PUBLIC SCHOOL FACILITIES 
Sec. 311. Purpose. 
Sec. 312. Allocation of funds. 
Sec. 313. Allowable uses of funds. 
Sec. 314. Priority projects. 
CHAPTER 2—SUPPLEMENTAL GRANTS FOR LOUISIANA, MISSISSIPPI, AND 
ALABAMA 
Sec. 321. Purpose. 
Sec. 322. Allocation to local educational agencies. 
Sec. 323. Allowable uses of funds. 
CHAPTER 3—GENERAL PROVISIONS 
Sec. 331. Impermissible uses of funds. 
Sec. 332. Supplement, not supplant. 
Sec. 333. Prohibition regarding State aid. 
Sec. 334. Maintenance of effort. 
Sec. 335. Special rule on contracting. 
Sec. 336. Use of American iron, steel, and manufactured goods. 
Sec. 337. Labor standards. 
Sec. 338. Charter schools. 
Sec. 339. Green schools. 
Sec. 340. Reporting. 
Sec. 341. Special rules. 
Sec. 342. Promotion of employment experiences. 
Sec. 343. Advisory Council on Green, High-Performing Public School Facilities. 
Sec. 344. Education regarding projects. 
Sec. 345. Availability of funds. 
Subtitle B—Higher Education 
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Sec. 351. Federal assistance for community college modernization and construc-
tion. 
TITLE IV—EARLY LEARNING CHALLENGE FUND 
Sec. 401. Purpose. 
Sec. 402. Programs authorized. 
Sec. 403. Quality pathways grants. 
Sec. 404. Development grants. 
Sec. 405. Research and evaluation. 
Sec. 406. Reporting requirements. 
Sec. 407. Construction. 
Sec. 408. Definitions. 
Sec. 409. Availability of funds. 
TITLE V—AMERICAN GRADUATION INITIATIVE 
Sec. 501. Authorization and appropriation. 
Sec. 502. Definitions; grant priority. 
Sec. 503. Grants to eligible entities for community college reform. 
Sec. 504. Grants to eligible States for community college programs. 
Sec. 505. National activities. 
TITLE VI—DEFUND ACORN ACT 
Sec. 601. Short title. 
Sec. 602. Prohibitions on Federal funds and other activities with respect to cer-
tain indicted organizations. 
SEC. 3. REFERENCES. 
Except as otherwise expressly provided, whenever in 
this Act an amendment or repeal is expressed in terms 
of an amendment to, or repeal of, a section or other provi-
sion, the reference shall be considered to be made to a 
section or other provision of the Higher Education Act of 
1965 (20 U.S.C. 1001 et seq.). 
SEC. 4. PROHIBITION ON EARMARKS. 
None of the funds appropriated pursuant to this Act 
may be used for a Congressional earmark as defined in 
clause 9(d) of rule XXI of the Rules of the House of Rep-
resentatives. 
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SEC. 5. USE OF SAVINGS FOR DEBT REDUCTION. 
All savings in Federal expenditures not otherwise ex-
pended as a result of the enactment of this Act shall be 
made available for the reduction of the Federal deficit. 
TITLE I—INVESTING IN 
STUDENTS AND FAMILIES 
Subtitle A—Increasing College 
Access and Completion 
SEC. 101. FEDERAL PELL GRANTS. 
(a) AMOUNT
OF
GRANTS.—Section 401(b) (20 
U.S.C. 1070a(b)) is amended— 
(1) by amending paragraph (2)(A) to read as 
follows: 
‘‘(A) The amount of the Federal Pell 
Grant for a student eligible under this part 
shall be— 
‘‘(i) the maximum Federal Pell Grant, 
as specified in the last enacted appropria-
tion Act applicable to that award year, 
plus 
‘‘(ii) the amount of the increase cal-
culated under paragraph (8)(B) for that 
year, less 
‘‘(iii) an amount equal to the amount 
determined to be the expected family con-
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tribution with respect to that student for 
that year.’’; and 
(2) by amending paragraph (8), as amended by 
the Higher Education Opportunity Act (Public Law 
110–315), to read as follows: 
‘‘(8) ADDITIONAL FUNDS.— 
‘‘(A) IN GENERAL.—There are authorized 
to be appropriated, and there are appropriated, 
to carry out subparagraph (B) of this para-
graph (in addition to any other amounts appro-
priated to carry out this section and out of any 
money in the Treasury not otherwise appro-
priated) the following amounts— 
‘‘(i) $2,030,000,000 for fiscal year 
2008; 
‘‘(ii) $2,733,000,000 for fiscal year 
2009; and 
‘‘(iii) such sums as may be necessary 
for fiscal year 2010 and each subsequent 
fiscal year to provide the amount of in-
crease of the maximum Federal Pell Grant 
required by clauses (ii) and (iii) of sub-
paragraph (B). 
‘‘(B) 
INCREASE
IN
FEDERAL
PELL 
GRANTS.—The amounts made available pursu-
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ant to subparagraph (A) shall be used to in-
crease the amount of the maximum Federal 
Pell Grant for which a student shall be eligible 
during an award year, as specified in the last 
enacted appropriation Act applicable to that 
award year, by— 
‘‘(i) $490 for each of the award years 
2008–2009 and 2009–2010; 
‘‘(ii) $690 for the award year 2010– 
2011; and 
‘‘(iii) the amount determined under 
subparagraph (C) for each succeeding 
award year. 
‘‘(C) INFLATION-ADJUSTED AMOUNTS.— 
‘‘(i) AWARD
YEAR
2011–2012.—For 
award year 2011–2012, the amount deter-
mined under this subparagraph for pur-
poses of subparagraph (B)(iii) shall be 
equal to— 
‘‘(I) $5,550 or the total max-
imum Federal Pell Grant for the pre-
ceding award year (as determined 
under clause (iv)(II)), whichever is 
greater, increased by a percentage 
equal to the annual adjustment per-
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centage for award year 2011–2012; 
reduced by 
‘‘(II) $4,860 or the maximum 
Federal Pell Grant for which a stu-
dent was eligible for the preceding 
award year, as specified in the last en-
acted appropriation Act applicable to 
that year, whichever is greater; and 
‘‘(III) rounded to the nearest $5. 
‘‘(ii) SUBSEQUENT AWARD YEARS.— 
For award year 2012–2013 and each of 
the subsequent award years, the amount 
determined under this subparagraph for 
purposes of subparagraph (B)(iii) shall be 
equal to— 
‘‘(I) the total maximum Federal 
Pell Grant for the preceding award 
year (as determined under clause 
(iv)(II)), increased by a percentage 
equal to the annual adjustment per-
centage for the award year for which 
the amount under this subparagraph 
is being determined; reduced by 
‘‘(II) $4,860 or the maximum 
Federal Pell Grant for which a stu-
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dent was eligible for the preceding 
award year, as specified in the last en-
acted appropriation Act applicable to 
that year, whichever is greater; and 
‘‘(III) rounded to the nearest $5. 
‘‘(iii) LIMITATION ON DECREASES.— 
Notwithstanding clauses (i) and (ii), if the 
amount determined under clause (i) or (ii) 
for an award year is less than the amount 
determined under this paragraph for the 
preceding award year, the amount deter-
mined under such clause for such award 
year shall be the amount determined under 
this paragraph for the preceding award 
year. 
‘‘(iv) DEFINITIONS.—For purposes of 
this subparagraph— 
‘‘(I) the term ‘annual adjustment 
percentage’ as it applies to an award 
year is equal to the sum of— 
‘‘(aa) the estimated percent-
age change in the Consumer 
Price Index (as determined by 
the Secretary, using the defini-
tion in section 478(f)) for the 
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most recent calendar year ending 
prior to the beginning of that 
award year; and 
‘‘(bb) one percentage point; 
and 
‘‘(II) the term ‘total maximum 
Federal Pell Grant’ as it applies to a 
preceding award year is equal to the 
sum of— 
‘‘(aa) the maximum Federal 
Pell Grant for which a student is 
eligible during an award year, as 
specified in the last enacted ap-
propriation Act applicable to that 
preceding award year; and 
‘‘(bb) the amount of the in-
crease in the maximum Federal 
Pell Grant required by this para-
graph for that preceding award 
year. 
‘‘(D) PROGRAM REQUIREMENTS AND OP-
ERATIONS
OTHERWISE
UNAFFECTED.—Except 
as provided in subparagraphs (B) and (C), 
nothing in this paragraph shall be construed to 
alter the requirements and operations of the 
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Federal Pell Grant Program as authorized 
under this section, or to authorize the imposi-
tion of additional requirements or operations 
for the determination and allocation of Federal 
Pell Grants under this section. 
‘‘(E) 
AVAILABILITY
OF
FUNDS.—The 
amounts made available by subparagraph (A) 
for any fiscal year shall be available beginning 
on October 1 of that fiscal year, and shall re-
main available through September 30 of the 
succeeding fiscal year.’’. 
(b) MULTIPLE
PELL
GRANT
AWARDS.—Section 
401(b)(5) (20 U.S.C. 1070a(b)(5)) is amended— 
(1) in subparagraph (A)— 
(A) by inserting ‘‘who is making satisfac-
tory academic progress according to the institu-
tion’s standards’’ after ‘‘award a student’’; and 
(B) by striking ‘‘to permit such student to 
accelerate the student’s progress toward a de-
gree or certificate’’ and inserting ‘‘to permit 
such student to accelerate the student’s gradua-
tion date, whether making full- or part-time 
progress toward a degree or certificate,’’; and 
(2) by adding at the end the following new sub-
paragraph: 
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