eral Register with a notice and comment period of 
not less than 60 days. 
‘‘(2) DETERMINATION.—The Secretary shall 
publish each determination on an application for 
conversion under this section, and the reasons for 
such determination, in the Federal Register. 
‘‘(f) TAX EXEMPT STATUS.—In carrying out this sec-
tion, the Secretary may consider the nonprofit corporation 
status under State law or the tax exempt status of an in-
stitution of higher education under section 501(c)(3) of 
the Internal Revenue Code of 1986, but shall not use such 
statuses as the sole determining factor for approval under 
subsection (a). 
‘‘(g) PUBLIC REPRESENTATION AND MARKETING OF 
NONPROFIT STATUS.—A for-profit institution of higher 
education that receives assistance under title IV that is 
seeking to convert under this section shall not promote 
or market itself, in any manner, as a nonprofit institution 
of higher education until— 
‘‘(1) the Secretary has approved the conversion 
of the institution to a nonprofit institution under 
this section; 
‘‘(2) the Commissioner of Internal Revenue has 
approved the institution as tax exempt for purposes 
of the Internal Revenue Code of 1986 and the insti-
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tution is an organization described in clause (ii) or 
(vi) of section 170(b)(1)(A) of such Code; and 
‘‘(3) a nationally recognized accrediting agency 
or association recognized by the Secretary pursuant 
to section 496 has approved the nonprofit status of 
the institution.’’. 
(b) REVIEW AND ENFORCEMENT PROCESS.— 
(1) IN GENERAL.—Section 487(c)(1) of the Act 
(20 U.S.C. 1094(c)(1)) is amended— 
(A) by redesignating subparagraphs (B) 
through (I) as subparagraphs (C) through (J), 
respectively; and 
(B) by inserting after subparagraph (A) 
the following: 
‘‘(B)(i) a requirement that an institution 
of higher education shall use the same qualified, 
independent organization or person, in accord-
ance with standards established by the Comp-
troller General for the audit of governmental 
organizations, programs, and functions, and as 
prescribed in regulations of the Secretary, for 
both the financial and compliance audits re-
quired for a given year under subparagraph 
(A); 
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‘‘(ii) a requirement that the qualified, inde-
pendent organization or person chosen to con-
duct the annual financial and compliance audits 
under subparagraph (A) shall document, in the 
audit, any transactions or relationships that 
may conflict with an institution’s status as a 
nonprofit institution of higher education or pub-
lic institution of higher education; and 
‘‘(iii) in accordance with section 489A, in 
any case where the Secretary determines, after 
providing an institution with reasonable notice 
and an opportunity for a hearing, that the insti-
tution is classified as a public institution of 
higher education or a nonprofit institution for 
purposes of this Act but is in violation of, or 
has failed to carry out, any requirements relat-
ing to such nonprofit or public status in accord-
ance with paragraphs (13) and (15) of section 
103 or section 124, a process through which the 
Secretary may— 
‘‘(I) limit, suspend, or terminate the 
institution’s participation in any program 
under this title under section 489A(b)(1); 
‘‘(II) impose a civil penalty under sec-
tion 489A(c); or 
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‘‘(III) take an emergency action under 
section 498A(d) against an institution.’’. 
(2) 
CONFORMING
AMENDMENTS.—Section 
487(i) (20 U.S.C. 1094(i)), as redesignated by sec-
tion 101(b)(3), is further amended— 
(A) by striking ‘‘subsection (c)(1)(D),’’; 
and 
(B) by inserting ‘‘or subsection (b)(1) or 
(c) of section 489A’’ after ‘‘of this section’’. 
SEC. 103. FOR-PROFIT EDUCATION OVERSIGHT COORDINA-
TION COMMITTEE. 
Part B of title I (20 U.S.C. 1011 et seq.), as amend-
ed by section 102, is further amended by adding at the 
end the following: 
‘‘SEC. 125. FOR-PROFIT EDUCATION OVERSIGHT COORDINA-
TION COMMITTEE. 
‘‘(a) DEFINITIONS.—In this section: 
‘‘(1) EXECUTIVE OFFICER.—The term ‘execu-
tive officer’, with respect to a for-profit institution 
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, di-
vision, or function of such corporation, such as 
sales, administration, or finance; or 
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‘‘(C) any other officer or person who per-
forms a policy-making function for such cor-
poration. 
‘‘(2) 
FEDERAL
EDUCATION
ASSISTANCE 
FUNDS.—The term ‘Federal education assistance 
funds’ has the meaning given the term in section 
102(b)(2)(B). 
‘‘(3) FOR-PROFIT
INSTITUTION.—The term 
‘for-profit institution’— 
‘‘(A) means a for-profit institution of high-
er education as defined in section 102(b)(2); 
and 
‘‘(B) includes a former for-profit institu-
tion of higher education that has been approved 
for conversion under section 124 but is still in 
the transition period required under section 
124(c). 
‘‘(4) 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 guaran-
teed under title IV; 
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‘‘(ii) is issued expressly for postsec-
ondary 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; and 
‘‘(iii) is not made, insured, or guaran-
teed 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 cred-
it 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. 
‘‘(5) RECRUITING
AND
MARKETING
ACTIVI-
TIES.—The term ‘recruiting and marketing activi-
ties’ means the recruiting and marketing activities 
described in section 126(d)(2). 
‘‘(6) STATE
APPROVAL
AGENCY.—The term 
‘State approval agency’ means any State agency that 
determines whether an institution of higher edu-
cation is legally authorized within such State to pro-
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vide a program of education beyond secondary edu-
cation. 
‘‘(7) VETERANS SERVICE ORGANIZATION.—The 
term ‘veterans service organization’ means an orga-
nization recognized by the Secretary of Veterans Af-
fairs for the representation of veterans under section 
5902 of title 38, United States Code. 
‘‘(b) ESTABLISHMENT OF COMMITTEE.— 
‘‘(1) ESTABLISHMENT.—There is established in 
the executive branch a committee to be known as the 
‘For-Profit Education Oversight Coordination Com-
mittee’ (referred to in this section as the ‘Com-
mittee’) and to be composed of the head (or the des-
ignee of such head) of each of the following Federal 
entities: 
‘‘(A) The Department of Education. 
‘‘(B) The Bureau of Consumer Financial 
Protection. 
‘‘(C) The Department of Justice. 
‘‘(D) The Securities and Exchange Com-
mission. 
‘‘(E) The Department of Defense. 
‘‘(F) The Department of Veterans Affairs. 
‘‘(G) The Federal Trade Commission. 
‘‘(H) The Department of Labor. 
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‘‘(I) The Internal Revenue Service. 
‘‘(J) The enforcement unit of the Perform-
ance-Based Organization established under sec-
tion 141(g). 
‘‘(K) At the discretion of the Chairperson 
of the Committee, any other relevant Federal 
agency or department. 
‘‘(2) PURPOSES.—The Committee shall have 
the following purposes: 
‘‘(A) Coordinate Federal oversight of for- 
profit institutions to— 
‘‘(i) improve enforcement of applicable 
Federal laws and regulations; 
‘‘(ii) increase accountability of for- 
profit institutions to students and tax-
payers; and 
‘‘(iii) ensure the promotion of quality 
education programs. 
‘‘(B) Coordinate Federal activities to pro-
tect students from unfair, deceptive, abusive, 
unethical, fraudulent, or predatory practices, 
policies, or procedures of for-profit institutions. 
‘‘(C) 
Encourage 
information 
sharing 
among agencies related to Federal investiga-
tions, audits, program reviews, inquiries, com-
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plaints, financial statements, and other infor-
mation relevant to the oversight of for-profit in-
stitutions. 
‘‘(D) Develop binding memoranda of un-
derstanding that the Federal entities rep-
resented on the committee will use regarding 
the sharing of information to exercise the over-
sight described in this section. 
‘‘(E) 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 for-profit institutions. 
‘‘(F) Develop best practices and consist-
ency among Federal and State agencies in the 
dissemination of consumer information regard-
ing for-profit institutions to ensure that stu-
dents, parents, and other stakeholders have 
easy access to such information. 
‘‘(3) MEMBERSHIP.— 
‘‘(A) DESIGNEES.—For any designee de-
scribed in paragraph (1), the head of the mem-
ber entity shall appoint a high-level official who 
exercises significant decision-making authority 
for the oversight or investigatory activities and 
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responsibilities related to for-profit institutions 
of the respective member entity. 
‘‘(B) CHAIRPERSON.—The Secretary of 
Education or the designee of such Secretary 
shall serve as the Chairperson of the Com-
mittee. 
‘‘(C) COMMITTEE SUPPORT.—The head of 
each entity described in paragraph (1) shall en-
sure appropriate staff and officials of such enti-
ty are available to support the Committee-re-
lated work of such entity. 
‘‘(c) MEETINGS.— 
‘‘(1) 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 subsection 
(b)(2). 
‘‘(2) 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 organiza-
tions, and consumer advocates to carry out the pur-
poses described in subsection (b)(2). 
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‘‘(d) DIRECTOR.—The Chairperson shall appoint a 
full-time executive director to support the Committee and 
may appoint and fix the pay of additional staff as the 
Chairperson considers appropriate. 
‘‘(e) REPORT.— 
‘‘(1) IN GENERAL.—The Committee shall sub-
mit a report each year to the authorizing committees 
and any other committee of Congress that the Com-
mittee determines appropriate. 
‘‘(2) PUBLIC ACCESS.—The report described in 
paragraph (1) shall be made available to the public 
in a manner that is easily accessible to parents, stu-
dents, and other stakeholders, in accordance with 
the best practices developed under subsection 
(b)(2)(F). 
‘‘(3) CONTENTS.— 
‘‘(A) IN GENERAL.—The report shall in-
clude— 
‘‘(i) an accounting of any action (as 
defined in subparagraph (C)) 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 for- 
profit institutions; 
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‘‘(II) to hold for-profit institu-
tions accountable to students and tax-
payers; and 
‘‘(III) to promote quality edu-
cation programs; 
‘‘(ii) a summary of complaints against 
each for-profit institution received by any 
member entity of the Committee; 
‘‘(iii) the data described in subpara-
graph (B) and any other data relevant to 
for-profit institutions that the Committee 
determines appropriate; and 
‘‘(iv) recommendations of the Com-
mittee for such legislative and administra-
tive actions as the Committee determines 
are necessary to— 
‘‘(I) improve enforcement of ap-
plicable Federal laws; 
‘‘(II) increase accountability of 
for-profit institutions to students and 
taxpayers; and 
‘‘(III) ensure the promotion of 
quality education programs. 
‘‘(B) DATA.— 
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‘‘(ff) Executive compensa-
tion for the 10 highest-paid for- 
profit institution executives. 
‘‘(gg) The average retention 
and graduation rates for students 
pursuing a certificate or a degree 
at for-profit institutions. 
‘‘(hh) The average cohort 
default rate (as defined in section 
435(m)). 
‘‘(ii) With respect to all ca-
reers requiring the passage of a 
licensing examination, and disag-
gregated by each such career— 
‘‘(AA) the average pas-
sage rate of individuals who 
attended a for-profit institu-
tion taking such examina-
tion to pursue such a career; 
‘‘(BB) the average pas-
sage rate of all individuals 
taking such exam to pursue 
such a career; and 
‘‘(CC) the percentage of 
all individuals taking such 
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exam who attended a for- 
profit institution. 
‘‘(jj) Information regarding 
the use of private education loans 
at for-profit institutions that in-
cludes— 
‘‘(AA) an estimate of 
the total number of such 
loans; and 
‘‘(BB) information on 
the average debt, default 
rate, and interest rate of 
such loans. 
‘‘(II) The financial composite 
scores, in accordance with section 
498, for each for-profit institution, 
the name and dollar amount of any 
letters of credit required under sub-
part L of part 668 of title 34, Code 
of Federal Regulations (or any suc-
cessor regulation), and the name of 
each institution placed under the 
heightened cash monitoring payment 
method, as established under section 
668.162(d) of title 34, Code of Fed-
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eral Regulations (or any successor 
regulation). 
‘‘(ii) DATA ON CORPORATIONS.— 
‘‘(I) IN
GENERAL.—The report 
shall include data on for-profit institu-
tions that are publicly traded corpora-
tions, consisting of information on— 
‘‘(aa) any pre-tax profit of 
such for-profit institutions— 
‘‘(AA) reported as a 
total amount and as the av-
erage percentage of revenue 
for all such for-profit insti-
tutions; and 
‘‘(BB) reported as a 
total amount and as the av-
erage percentage of revenue 
for each such for-profit in-
stitution; 
‘‘(bb) spending on pre-en-
rollment recruiting and mar-
keting activities, student instruc-
tion, and student support serv-
ices, and for each of the 3 cat-
egories separately reported— 
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‘‘(AA) 
as 
a 
total 
amount and the average per-
centage of revenue for all 
such for-profit institutions; 
and 
‘‘(BB) for each such 
for-profit institution; 
‘‘(cc) 
total 
compensation 
packages of the executive officers 
of each such for-profit institu-
tion; 
‘‘(dd) a list of institutional 
loan programs offered by each 
such for-profit institution that in-
cludes information on the default 
and interest rates of such pro-
grams; and 
‘‘(ee) the data described in 
subclauses (II) and (III). 
‘‘(II) DISAGGREGATED BY OWN-
ERSHIP.—The report shall include 
data on for-profit institutions that are 
corporations, disaggregated by cor-
porate or parent entity, brand name, 
and campus, consisting of— 
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‘‘(aa) the total cost of at-
tendance for each program at 
each such for-profit institution; 
‘‘(bb) total enrollment, dis-
aggregated by— 
‘‘(AA) individuals en-
rolled in programs taken ex-
clusively online; 
‘‘(BB) individuals en-
rolled in programs that are 
exclusively in person; and 
‘‘(CC) individuals en-
rolled in programs that are 
a mix of online and in per-
son; 
‘‘(cc) 
the 
retention 
and 
graduation rates for students 
pursuing a degree at such for- 
profit institutions, including the 
number of students who enroll 
each year and withdraw in less 
than one year; 
‘‘(dd) the percentage of stu-
dents enrolled in such for-profit 
institutions who complete a pro-
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gram of such an institution with-
in— 
‘‘(AA) the standard pe-
riod of completion for such 
program; and 
‘‘(BB) a period that is 
150 percent of such stand-
ard period of completion; 
‘‘(ee) the average cohort de-
fault rate, as defined in section 
435(m), for such for-profit insti-
tutions, and an annual list of co-
hort default rates (as so defined) 
for all for-profit institutions; 
‘‘(ff) the median educational 
debt incurred by students who 
complete a program at such a 
for-profit institution of higher 
education; 
‘‘(gg) 
the 
median 
edu-
cational debt incurred by stu-
dents who start but do not com-
plete a program at such a for- 
profit institution of higher edu-
cation; 
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‘‘(hh) the job placement rate 
for students who complete a pro-
gram at such a for-profit institu-
tion of higher education and the 
type of employment obtained by 
such students; 
‘‘(ii) for careers requiring 
the passage of a licensing exam-
ination, the rate of individuals 
who attended such a for-profit in-
stitution and passed such an ex-
amination; and 
‘‘(jj) the number of com-
plaints from students enrolled in 
such for-profit institutions that 
have been submitted to any mem-
ber entity of the Committee. 
‘‘(III) 
DEPARTMENT
OF
DE-
FENSE
AND
VETERANS
AFFAIRS
AS-
SISTANCE.— 
‘‘(aa) IN GENERAL.—To the 
extent practicable, the report 
shall provide information on the 
data described in subclause (II) 
for individuals who pay for the 
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costs of attending a for-profit in-
stitution of higher education that 
is a corporation by using 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. 
‘‘(bb) REVENUE.—The re-
port shall provide information on 
the revenue of such for-profit in-
stitutions that is derived from 
the Federal education assistance 
described in item (aa). 
‘‘(iii) COMPARISON DATA.—The report 
shall provide information comparing, in the 
aggregate and disaggregated by State, 
each of the data elements described in 
clause (ii) for for-profit institutions that 
are publicly traded corporations, for-profit 
institutions that are not owned or operated 
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by a publicly traded company, nonprofit in-
stitutions, and public institutions. 
‘‘(iv) INFORMATION REGARDING OWN-
ERSHIP INTERESTS.—The report shall, for 
each for-profit institution of higher edu-
cation that is not a publicly traded cor-
poration, report the name of any indi-
vidual, partnership, or corporation that 
holds an ownership interest of 5 percent or 
greater of the for-profit institution of high-
er education. 
‘‘(C) ACCOUNTING OF ANY ACTION.—For 
the purposes of subparagraph (A)(i), the term 
‘any action’ shall include— 
‘‘(i) a complaint filed by a Federal or 
State agency in a local, State, Federal, or 
Tribal court; 
‘‘(ii) an administrative proceeding by 
a Federal or State agency involving non-
compliance of any applicable law or regula-
tion; 
‘‘(iii) any other review, audit, or ad-
ministrative process by any Federal or 
State agency that results in a penalty, sus-
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pension, or termination from any Federal 
or State program; or 
‘‘(iv) a negative or adverse action 
taken by an accrediting agency or associa-
tion recognized by the Secretary pursuant 
to section 496 with respect to an approved 
institution or program. 
‘‘(f) FOR-PROFIT COLLEGE WARNING LIST
FOR 
PARENTS AND STUDENTS.— 
‘‘(1) 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 for-profit institutions— 
‘‘(A) that have engaged in illegal activity 
during the previous academic year as deter-
mined by a Federal or State court; 
‘‘(B) that have entered into a settlement 
with a Federal or State entity resulting in a 
monetary payment; 
‘‘(C) that have had any higher education 
program limited, withdrawn, or suspended by 
an external entity (such as a Federal or State 
entity or an accrediting agency or association 
recognized by the Secretary pursuant to section 
496); and 
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‘‘(D) for which the Committee has suffi-
cient 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. 
‘‘(2) DETERMINATIONS.—In making a deter-
mination pursuant to paragraph (1)(D), the Com-
mittee may consider evidence that includes the fol-
lowing: 
‘‘(A) Any consumer complaint collected by 
any member entity of the Committee. 
‘‘(B) Any complaint filed by a Federal or 
State entity in a Federal, State, local, or Tribal 
court. 
‘‘(C) Any administrative proceeding by a 
Federal or State entity involving noncompliance 
of any applicable law or regulation. 
‘‘(D) Any other review, audit, or adminis-
trative process by any Federal or State entity 
that results in a penalty, suspension, or termi-
nation from any Federal or State program. 
‘‘(E) Data or information submitted by a 
for-profit institution to any accrediting agency 
or association recognized by the Secretary pur-
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suant to section 496 or the findings or adverse 
actions of any such accrediting agency or asso-
ciation. 
‘‘(F) Information submitted by a for-profit 
institution to any member entity of the Com-
mittee. 
‘‘(G) Any other evidence that the Com-
mittee determines relevant in making such de-
termination. 
‘‘(3) PUBLICATION.—Not later than July 1 of 
each fiscal year, the Committee shall publish the list 
under paragraph (1) prominently and in a manner 
that is easily accessible to parents, students, and 
other stakeholders, in accordance with any best 
practices developed under subsection (b)(2)(F).’’. 
TITLE II—STUDENT AND 
BORROWER PROTECTIONS 
SEC. 201. GAINFUL EMPLOYMENT PROGRAMS. 
(a) IN GENERAL.—Section 102 (20 U.S.C. 1002), as 
amended by sections 4(b) and 101, is further amended— 
(1) in subsection (b)(1)(A)— 
(A) by striking clause (ii); 
(B) by striking ‘‘(i) provides’’ and insert-
ing ‘‘provides’’; and 
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‘‘(C) GAINFUL EMPLOYMENT RULES.—The 
term ‘gainful employment rules’ means the 
rules issued under subpart Q of title 34, Code 
of Federal Regulations, as published on October 
31, 2014, relating to gainful employment in a 
recognized occupation. 
‘‘(2) IN
GENERAL.—An eligible training pro-
gram prepares students for gainful employment in a 
recognized occupation if the eligible training pro-
gram complies with all requirements of the gainful 
employment rules (including any modifications made 
by this subsection), including— 
‘‘(A) the provisions relating to the calcula-
tion of debt-to-earnings rates for the eligible 
training program, using actual annual earnings 
data of students who completed the eligible 
training program; 
‘‘(B) the provisions relating to the deter-
mination of outcomes for an eligible training 
program based on the debt-to-earnings rates, 
including whether an eligible training program 
is a ‘passing’, ‘failing’, or ‘zone’ program; 
‘‘(C) the provisions relating to the associ-
ated consequences for an eligible training pro-
gram that is not passing the debt-to-earnings 
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rates, including a student warning and ultimate 
loss of eligibility for assistance under title IV; 
‘‘(D) the requirements relating to disclo-
sure, reporting, and certification; and 
‘‘(E) the calculation of completion rates, 
withdrawal rates, repayment rates, program co-
hort default rates, and median loan debt for the 
eligible training program. 
‘‘(3) 
ANNUAL
CALCULATIONS
AND 
VERIFICATIONS.—The Secretary shall carry out all 
of the following: 
‘‘(A) On an annual calendar year basis 
(notwithstanding section 668.403(c)(5) of the 
gainful employment rules) and for each eligible 
training program, calculate for each award year 
both of the debt-to-earnings rates for the eligi-
ble training program, issue a notice of deter-
mination, and enforce restrictions based on 
those determinations. In order to carry out the 
preceding sentence, the Secretary shall— 
‘‘(i) create a list of students who com-
pleted the eligible training program during 
the cohort period identified by the Sec-
retary; 
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‘‘(ii) provide the list to the institution 
offering the eligible training program and 
allow the institution a 45-day period begin-
ning the day after the date that the Sec-
retary provides the list to the institution, 
to submit any corrections to the list; 
‘‘(iii) after resolving any corrections, 
provide the institution with the final list 
and submit the final list of students who 
completed the eligible training program to 
the Social Security Administration, the In-
ternal Revenue Service, or any other Fed-
eral agency that administers a database 
that contains earnings information that 
can be matched to the individuals named 
in the final list, and retrieve the mean and 
median annual earnings of students on the 
lists, in aggregate and not in individual 
form, within 10 business days after sub-
mission; 
‘‘(iv) calculate and send the debt-to- 
earnings rates to the institution offering 
the eligible training program and allow the 
institution a 45-day period, beginning after 
the date the Secretary notifies an institu-
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tion of the debt-to-earnings rates, to chal-
lenge the accuracy of information used to 
calculate the eligible training program’s 
median loan debt; 
‘‘(v) subject to the resolution of any 
challenge, issue a notice of determination 
informing the institution— 
‘‘(I) of the final debt-to-earnings 
rates of each eligible training program 
to the institution offering the pro-
gram; 
‘‘(II) of the final determination 
regarding whether the program is a 
passing, failing, or zone program, or 
is ineligible, and the consequences of 
that determination; 
‘‘(III) whether the program could 
become ineligible based on its final 
debt-to-earnings rates for the next 
award year; 
‘‘(IV) whether the institution is 
required to provide warnings to en-
rolled students and prospective stu-
dents; and 
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‘‘(V) if the program is deter-
mined to be a failing or zone program 
due to the final debt-to-earnings rates, 
how the program may make an alter-
nate earnings appeal, in accordance 
with paragraph (4); 
‘‘(vi) with respect to an institution 
that receives a notification from the Sec-
retary under clause (v)(III) and that does 
not submit an intent to appeal in accord-
ance with paragraph (4) or for which the 
appeal is denied, require the institution, 
not later than 30 days after receiving the 
notification of the determination or denial, 
to— 
‘‘(I) issue warnings to enrolled 
students and prospective students; 
and 
‘‘(II) update the disclosure tem-
plate, as required by the gainful em-
ployment rules, as modified by para-
graph (5); and 
‘‘(vii) enforce restrictions whereby— 
‘‘(I) an institution may not dis-
burse program funds under title IV to 
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students enrolled in an ineligible pro-
gram; and 
‘‘(II) an institution may not seek 
to reestablish the eligibility of a fail-
ing or zone program that it discon-
tinued voluntarily, reestablish the eli-
gibility of a program that is ineligible 
under the debt-to-earnings rates, or 
establish the eligibility of a program 
that is substantially similar to the dis-
continued or ineligible program, until 
3 years following the date specified in 
the notice of determination informing 
the institution of the program’s ineli-
gibility or the date the institution dis-
continued the failing or zone program; 
and 
‘‘(B) develop processes to verify, on an an-
nual calendar year basis, that— 
‘‘(i) required warnings under the gain-
ful employment rules are delivered to en-
rolled students and prospective students 
and are published on the eligible training 
program’s disclosure template, in accord-
ance with subparagraph (A)(vii); and 
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‘‘(ii) each eligible training program is 
publishing the disclosure template on the 
website of the eligible training program, as 
required by the gainful employment rules, 
as modified by paragraph (5). 
‘‘(4) ALTERNATE
EARNINGS
APPEALS
PROC-
ESS.—The Secretary shall establish and enforce an 
appeals process for any institution of higher edu-
cation that wish to file an alternate earnings appeal 
for an eligible training program that is a failing or 
zone program under the debt-to-earnings rates. The 
appeals process shall be carried out in accordance 
with the gainful employment rules, except that the 
appeals process shall also— 
‘‘(A) allow an institution to file an alter-
nate earnings appeal, in accordance with the 
gainful employment rules, to request the recal-
culation of a gainful employment program’s 
most recent final debt-to-earnings rates issued 
by the Secretary, except that— 
‘‘(i) any institution that elects to sub-
mit alternate earnings from an institu-
tional survey shall, in addition to the other 
requirements in the gainful employment 
rules— 
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Social Security Administration, the Internal 
Revenue Service, or any other Federal agency 
with a database containing individual-level earn-
ings data. 
‘‘(5) GAINFUL EMPLOYMENT DISCLOSURE RE-
QUIREMENTS.—Notwithstanding section 668.412(a) 
of the gainful employment rules, the Secretary shall 
include in the disclosure template all the information 
listed in paragraphs (1) through (16) of section 
668.412(a) of the gainful employment rules, unless 
the Secretary— 
‘‘(A) determines that consumer testing 
supports the noninclusion of the information 
listed in any such paragraph; and 
‘‘(B) publishes the Secretary’s determina-
tion, and the consumer testing supporting the 
determination, on the public website of the De-
partment. 
‘‘(6) ROLE OF SOCIAL SECURITY ADMINISTRA-
TION, 
THE
INTERNAL
REVENUE
SERVICE, 
AND 
OTHER FEDERAL AGENCIES.—The Commissioner of 
Social Security, the Commissioner of Internal Rev-
enue, and the head of any other Federal agency that 
administers the database of individual-level earnings 
data shall, in coordination with the Secretary, timely 
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provide the Secretary with the earnings information 
as required in accordance with paragraph (3)(A)(iii) 
and the gainful employment rules.’’. 
(b) CONFORMING AMENDMENT.—Section 101(b)(1) 
(20 U.S.C. 1001(b)(1)) is amended by inserting ‘‘, as de-
scribed in section 102(e),’’ after ‘‘recognized occupation’’. 
(c) EFFECTIVE DATE.—Notwithstanding section 3, 
this section shall take effect on the date of enactment of 
this Act. 
SEC. 202. PROHIBITION ON INSTITUTIONS LIMITING STU-
DENT LEGAL ACTION. 
(a) 
ENFORCEMENT
OF
ARBITRATION
AGREE-
MENTS.— 
(1) IN GENERAL.—Chapter 1 of title 9, United 
States Code (relating to the enforcement of arbitra-
tion agreements), shall not apply to an enrollment 
agreement made between a student and an institu-
tion of higher education. 
(2) DEFINITION.—In this section, the term ‘‘in-
stitution of higher education’’ has the meaning given 
such term in section 102 of the Higher Education 
Act of 1965 (20 U.S.C. 1002), as amended by sec-
tion 101 of this Act. 
(b) PROHIBITION ON LIMITATIONS ON ABILITY OF 
STUDENTS TO PURSUE CLAIMS AGAINST CERTAIN INSTI-
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TUTIONS OF HIGHER EDUCATION.—Section 487(a) (20 
U.S.C. 1094(a)), as amended by section 101, is further 
amended by adding at the end the following: 
‘‘(29) The institution will not require any stu-
dent to agree to, and will not enforce, any limitation 
or restriction (including a limitation or restriction on 
any available choice of applicable law, a jury trial, 
or venue) on the ability of a student to pursue a 
claim, individually or with others, against an institu-
tion in court.’’. 
(c) EFFECTIVE DATE.—Notwithstanding section 3, 
this section shall take effect on the date of enactment of 
this Act. 
SEC. 203. ENFORCEMENT UNIT ESTABLISHED IN THE OF-
FICE OF FEDERAL STUDENT AID. 
Section 141 (20 U.S.C. 1018) is amended— 
(1) by redesignating subsections (g) through (i) 
as subsections (h) through (j), respectively; and 
(2) by inserting after subsection (f) the fol-
lowing: 
‘‘(g) ENFORCEMENT UNIT.— 
‘‘(1) IN GENERAL.—The Chief Operating Offi-
cer, in consultation with the Secretary, shall estab-
lish an enforcement unit within the PBO (referred 
to in this section as the ‘enforcement unit’). 
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‘‘(2) APPOINTMENT.— 
‘‘(A) CHIEF
ENFORCEMENT
OFFICER.— 
The Chief Operating Officer, in consultation 
with the Secretary, shall appoint a Chief En-
forcement Officer as a senior manager, in ac-
cordance with subsection (e), to perform the 
functions described in this subsection. The 
Chief Enforcement Officer shall report solely 
and directly to the Chief Operating Officer. 
‘‘(B) BONUS.—Notwithstanding subsection 
(e), the Chief Enforcement Officer may receive 
a bonus, separately determined from the meth-
odology which applies to the calculation of bo-
nuses for other senior managers, based upon 
the Chief Operating Officer’s evaluation of the 
Chief Enforcement Officer’s performance in re-
lation to the goals set forth in a performance 
agreement related to the specific duties of the 
enforcement unit. 
‘‘(3) DUTIES.—The enforcement unit shall— 
‘‘(A) receive, process, and analyze allega-
tions and complaints regarding the potential 
violation of Federal or State law (including civil 
and criminal law) or other unfair, deceptive, or 
abusive acts or practices, by institutions of 
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higher education, third party servicers that con-
tract with such institutions, and third party 
contractors; 
‘‘(B) investigate and coordinate investiga-
tions of potential or actual misconduct of insti-
tutions 
of 
higher 
education, 
third 
party 
servicers that contract with such institutions, 
and third party contractors; and 
‘‘(C) enforce compliance with laws gov-
erning Federal student financial assistance pro-
grams under title IV, including through the use 
of an emergency action in accordance to section 
489A, the limitation, suspension, or termination 
of the participation of an eligible institution in 
a program under title IV, or the imposition of 
a civil penalty in accordance with section 489A. 
‘‘(4) COORDINATION AND STAFFING.—The en-
forcement unit shall— 
‘‘(A) coordinate with relevant Federal and 
State agencies and oversight bodies, including 
the For-Profit Education Oversight Coordina-
tion Committee established under section 125; 
and 
‘‘(B) hire staff, (including by appointing 
not more than 10 individuals in positions of ex-
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