111
TITLE II—TEACHER QUALITY 
SEC. 201. TEACHER RECRUITING AND PREPARATION. 
(a) TEACH GRANTS.—Title II of the Higher Edu-
cation Act of 1965 (20 U.S.C. 1021 et seq.) is amended 
by adding at the end the following new part: 
‘‘PART C—TEACH GRANTS 
‘‘SEC. 231. PURPOSES. 
‘‘The purposes of the part are—
‘‘(1) to improve student academic achievement; 
‘‘(2) to help recruit and prepare teachers to 
meet the national demand for a highly qualified 
teacher in every classroom; and 
‘‘(3) to increase opportunities for Americans of 
all educational, ethnic, class, and geographic back-
grounds to become highly qualified teachers. 
‘‘SEC. 232. PROGRAM ESTABLISHED. 
‘‘(a) PROGRAM AUTHORITY.—
‘‘(1) PAYMENTS REQUIRED.—For each of the 
fiscal years 2006 through 2013, the Secretary shall 
pay to each eligible institution such sums as may be 
necessary to pay to each eligible student (defined in 
accordance with section 484) who files an applica-
tion and agreement in accordance with section 233, 
and qualifies under subsection (a)(2) of such section, 
a TEACH Grant in the amount of $4,000 for each
112
academic year during which that student is in at-
tendance at an institution of higher education. 
‘‘(2) REFERENCE.—Grants made under this 
part shall be known as ‘Teacher Education Assist-
ance for College and Higher Education Grants’ or 
‘TEACH Grants’. 
‘‘(b) PAYMENT METHODOLOGY.—
‘‘(1) PREPAYMENT.—Not less than 85 percent 
of such sums shall be advanced to eligible institu-
tions prior to the start of each payment period and 
shall be based upon an amount requested by the in-
stitution as needed to pay eligible students until 
such time as the Secretary determines and publishes 
in the Federal Register with an opportunity for com-
ment, an alternative payment system that provides 
payments to institutions in an accurate and timely 
manner, except that this sentence shall not be con-
strued to limit the authority of the Secretary to 
place an institution on a reimbursement system of 
payment. 
‘‘(2) DIRECT PAYMENT.—Nothing in this sec-
tion shall be interpreted to prohibit the Secretary 
from paying directly to students, in advance of the 
beginning of the academic term, an amount for 
which they are eligible, in cases where the eligible in-
113
stitution elects not to participate in the disburse-
ment system required by paragraph (1). 
‘‘(3) DISTRIBUTION
OF
GRANTS
TO
STU-
DENTS.—Payments under this part shall be made, in 
accordance with regulations promulgated by the Sec-
retary for such purpose, in such manner as will best 
accomplish the purpose of this part. Any disburse-
ment allowed to be made by crediting the student’s 
account shall be limited to tuition and fees and, in 
the case of institutionally owned housing, room and 
board. The student may elect to have the institution 
provide other such goods and services by crediting 
the student’s account. 
‘‘(c) REDUCTIONS IN AMOUNT.—
‘‘(1) PART
TIME
STUDENTS.—In any case 
where a student attends an institution of higher edu-
cation on less than a full-time basis (including a stu-
dent who attends an institution of higher education 
on less than a half-time basis) during any academic 
year, the amount of the TEACH Grant for which 
that student is eligible shall be reduced in proportion 
to the degree to which that student is not so attend-
ing on a full-time basis, in accordance with a sched-
ule of reductions established by the Secretary for the 
purposes of this part, computed in accordance with
114
this part. Such schedule of reductions shall be estab-
lished by regulation and published in the Federal 
Register in accordance with section 482 of this Act. 
‘‘(2) NO EXCEEDING COST.—No TEACH Grant 
under this part shall exceed the the cost of attend-
ance (as defined in section 472) at the institution at 
which that student is in attendance. If, with respect 
to any student, it is determined that the amount of 
a TEACH Grant exceeds the cost of attendance for 
that year, the amount of the TEACH Grant shall be 
reduced until the TEACH Grant does not exceed the 
cost of attendance at such institution. 
‘‘(d) PERIOD OF ELIGIBILITY FOR GRANTS.—
‘‘(1) UNDERGRADUATE STUDENTS.—The period 
during which an undergraduate student may receive 
TEACH Grants shall be the period required for the 
completion of the first undergraduate baccalaureate 
course of study being pursued by that student at the 
institution at which the student is in attendance ex-
cept that—
‘‘(A) any period during which the student 
is enrolled in a noncredit or remedial course of 
study as defined in paragraph (3) shall not be 
counted for the purpose of this paragraph; and