I 
113TH CONGRESS 
1ST SESSION H. R. 2155 
To award grants in order to establish longitudinal personal college readiness 
and savings online platforms for low-income students. 
IN THE HOUSE OF REPRESENTATIVES 
MAY 23, 2013 
Mr. FATTAH (for himself and Mr. HINOJOSA) introduced the following bill; 
which was referred to the Committee on Education and the Workforce 
A BILL 
To award grants in order to establish longitudinal personal 
college readiness and savings online platforms for low- 
income students. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘American Dream Ac-
counts Act of 2013’’. 
SEC. 2. FINDINGS. 
Congress finds the following: 
(1) Only 9.8 out of every 100 individuals from 
low-income families will graduate from an institution 
of higher education before reaching the age of 24. 
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(2) Lack of knowledge about how to apply to, 
and pay for, an institution of higher education is a 
barrier for many low-income students and students 
who would be in the first generation in their families 
to attend an institution of higher education. 
(3) According to Public Agenda, most young 
adults give secondary school counselors fair or poor 
ratings for advice about attending an institution of 
higher education, including advice about how to de-
cide what institution of higher education to attend, 
how to pay for higher education, what careers to 
pursue, and how to apply to an institution of higher 
education. 
(4) More than 1,700,000 students fail to file 
the Free Application for Federal Student Aid 
(FAFSA), and about one-third of such students 
would qualify for a Federal Pell Grant. 
(5) During the last 2 decades, costs of attend-
ing institutions of higher education have increased 
dramatically, but need-based financial aid has not 
kept pace with such increasing costs. 
(6) In the 1990–1991 school year, the max-
imum Federal Pell Grant covered 45 percent of the 
average cost of attendance at a public 4-year institu-
tion of higher education (including tuition, fees, 
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room, and board), but in the 2010–2011 school year, 
the maximum Federal Pell Grant covered only 34 
percent of such cost. 
(7) Parental and youth college savings are 
strong predictors of a youth’s expectations about at-
tendance at an institution of higher education. 
(8) Only 32 percent of parents who earn less 
than $35,000 a year are saving for their child’s edu-
cation at an institution of higher education. 
(9) According to the Center for Social Develop-
ment, ‘‘wilt’’ occurs when a young person who ex-
pects to graduate from a 4-year institution of higher 
education has not yet attended such institution by 
the ages of 19 to 22. 
(10) Children who have savings dedicated for 
attendance at an institution of higher education are 
4 times more likely to attend a 4-year institution of 
higher education and avoid ‘‘wilt’’. 
SEC. 3. DEFINITIONS. 
In this Act: 
(1) ESEA DEFINITIONS.—The terms ‘‘local 
educational agency’’, ‘‘parent’’, ‘‘State educational 
agency’’, and ‘‘Secretary’’ shall have the meanings 
given the terms in section 9101 of the Elementary 
and Secondary Education Act of 1965 (20 U.S.C. 
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7801) and the term ‘‘charter school’’ shall have the 
meaning given the term in section 5210 of such Act. 
(2) AMERICAN
DREAM
ACCOUNT.—The term 
‘‘American Dream Account’’ means a personal on-
line account for low-income students that monitors 
higher education readiness and includes a college 
savings account. 
(3) 
APPROPRIATE
COMMITTEES
OF
CON-
GRESS.—The term ‘‘appropriate committees of Con-
gress’’ means the Committee on Health, Education, 
Labor, and Pensions, the Committee on Appropria-
tions, and the Committee on Finance of the Senate, 
and the Committee on Education and the Work-
force, the Committee on Appropriations, and the 
Committee on Ways and Means of the House of 
Representatives, as well as any other Committee of 
the Senate or House of Representatives that the 
Secretary determines appropriate. 
(4) COLLEGE
SAVINGS
ACCOUNT.—The term 
‘‘college savings account’’ means a savings account 
that— 
(A) provides some tax-preferred accumula-
tion; 
(B) is widely available (such as Qualified 
Tuition Programs under section 529 of the In-
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ternal Revenue Code of 1986 or Coverdell Edu-
cation Savings Accounts under section 530 of 
the Internal Revenue Code of 1986); and 
(C) contains funds that may be used only 
for the costs associated with attending an insti-
tution of higher education, including— 
(i) tuition and fees; 
(ii) room and board; 
(iii) textbooks; 
(iv) supplies and equipment; and 
(v) Internet access. 
(5) DUAL ENROLLMENT PROGRAM.—The term 
‘‘dual enrollment program’’ means an academic pro-
gram through which a secondary school student is 
able simultaneously to earn credit toward a sec-
ondary school diploma and a postsecondary degree 
or credential. 
(6) ELIGIBLE ENTITY.—The term ‘‘eligible enti-
ty’’ means— 
(A) a State educational agency; 
(B) a local educational agency; 
(C) a charter school; 
(D) a charter management organization; 
(E) an institution of higher education; 
(F) a nonprofit organization; 
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(G) an entity with demonstrated experience 
in educational savings or in assisting low-in-
come students to prepare for, and attend, an in-
stitution of higher education; or 
(H) a consortium of 2 or more of the enti-
ties described in subparagraphs (A) through 
(G). 
(7) INSTITUTION OF HIGHER EDUCATION.—The 
term ‘‘institution of higher education’’ has the 
meaning given the term in section 101(a) of the 
Higher Education Act of 1965 (20 U.S.C. 1001(a)). 
(8) LOW-INCOME STUDENT.—The term ‘‘low-in-
come student’’ means a student who is eligible to re-
ceive a free or reduced price lunch under the Rich-
ard B. Russell National School Lunch Act (42 
U.S.C. 1751 et seq.). 
SEC. 4. GRANT PROGRAM. 
(a) PROGRAM AUTHORIZED.—The Secretary is au-
thorized to award grants, on a competitive basis, to eligible 
entities to enable such eligible entities to establish and ad-
minister American Dream Accounts for a group of low- 
income students. 
(b) RESERVATION.—From the amount appropriated 
each fiscal year to carry out this Act, the Secretary shall 
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reserve not more than 5 percent of such amount to carry 
out the evaluation activities described in section 7(a). 
(c) DURATION.—A grant awarded under this Act 
shall be for a period of not more than 3 years. The Sec-
retary may extend such grant for an additional 2-year pe-
riod if the Secretary determines that the eligible entity has 
demonstrated significant progress, based on the factors 
described in section 5(b)(11). 
SEC. 5. APPLICATIONS; PRIORITY. 
(a) IN GENERAL.—Each eligible entity desiring a 
grant under this Act shall submit an application to the 
Secretary at such time, in such manner, and containing 
such information as the Secretary may require. 
(b) CONTENTS.—At a minimum, the application de-
scribed in subsection (a) shall include the following: 
(1) A description of the characteristics of a 
group of not less than 30 low-income public school 
students who— 
(A) are, at the time of the application, at-
tending a grade not higher than grade 9; and 
(B) will, under the grant, receive an Amer-
ican Dream Account. 
(2) A description of how the eligible entity will 
engage, and provide support (such as tutoring and 
mentoring for students, and training for teachers 
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and other stakeholders) either online or in person, 
to— 
(A) the students in the group described in 
paragraph (1); 
(B) the family members and teachers of 
such students; and 
(C) other stakeholders such as school ad-
ministrators and school counselors. 
(3) An identification of partners who will assist 
the eligible entity in establishing and sustaining 
American Dream Accounts. 
(4) A description of what experience the eligible 
entity or the eligible entity’s partners have in man-
aging college savings accounts, preparing low-income 
students for postsecondary education, managing on-
line systems, and teaching financial literacy. 
(5) A demonstration that the eligible entity has 
sufficient resources to provide an initial deposit into 
the college savings account portion of each American 
Dream Account. 
(6) A description of how the eligible entity will 
help increase the value of the college savings account 
portion of each American Dream Account, such as 
by providing matching funds or incentives for aca-
demic achievement. 
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(7) A description of how the eligible entity will 
notify each participating student in the group de-
scribed in paragraph (1), on a semiannual basis, of 
the current balance and status of the student’s col-
lege savings account portion of the student’s Amer-
ican Dream Account. 
(8) A plan that describes how the eligible entity 
will monitor participating students in the group de-
scribed in paragraph (1) to ensure that each stu-
dent’s American Dream Account will be maintained 
if a student in such group changes schools before 
graduating from secondary school. 
(9) A plan that describes how the American 
Dream Accounts will be managed for not less than 
1 year after a majority of the students in the group 
described in paragraph (1) graduate from secondary 
school. 
(10) A description of how the eligible entity will 
encourage students in the group described in para-
graph (1) who fail to graduate from secondary 
school to continue their education. 
(11) A description of how the eligible entity will 
evaluate the grant program, including by collecting, 
as applicable, the following data about the students 
in the group described in paragraph (1) during the 
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grant period, and, if sufficient grant funds are avail-
able, after the grant period: 
(A) Attendance rates. 
(B) Progress reports. 
(C) Grades and course selections. 
(D) The student graduation rate, as de-
fined in section 1111(b)(2)(C)(vi) of the Ele-
mentary and Secondary Education Act of 1965 
(20 U.S.C. 6311(b)(2)(C)(vi)). 
(E) Rates of student completion of the 
Free Application for Federal Student Aid de-
scribed in section 483 of the Higher Education 
Act of 1965 (20 U.S.C. 1090). 
(F) Rates of enrollment in an institution of 
higher education. 
(G) Rates of completion at an institution 
of higher education. 
(12) A description of what will happen to the 
funds in the college savings account portion of the 
American Dream Accounts that are dedicated to 
participating students described in paragraph (1) 
who have not matriculated at an institution of high-
er education at the time of the conclusion of the pe-
riod of American Dream Account management de-
scribed in paragraph (9). 
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(13) A description of how the eligible entity will 
ensure that funds in the college savings account por-
tion of the American Dream Accounts will not make 
families ineligible for public assistance. 
(14) A description of how the eligible entity will 
ensure that participating students described in para-
graph (1) will have access to the Internet. 
(c) PRIORITY.—In awarding grants under this Act, 
the Secretary shall give priority to applications from eligi-
ble entities that— 
(1) are described in section 3(6)(H); 
(2) serve the largest number of low-income stu-
dents; or 
(3) in the case of an eligible entity described in 
subparagraphs (A) or (B) of section 3(6), provide 
opportunities for participating students described in 
paragraph (1) to participate in a dual enrollment 
program at no cost to the student. 
SEC. 6. AUTHORIZED ACTIVITIES. 
(a) IN GENERAL.—An eligible entity that receives a 
grant under this Act shall use such grant funds to estab-
lish an American Dream Account for each participating 
student described in section 5(b)(1), which will be used 
to— 
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(1) open a college savings account for such stu-
dent; 
(2) monitor the progress of such student online, 
which— 
(A) shall include monitoring student data 
relating to— 
(i) grades and course selections; 
(ii) progress reports; and 
(iii) 
attendance 
and 
disciplinary 
records; and 
(B) may also include monitoring student 
data relating to a broad range of information, 
provided by teachers and family members, re-
lated to postsecondary education readiness, ac-
cess, and completion; 
(3) provide opportunities for such students, ei-
ther online or in person, to learn about financial lit-
eracy, including by— 
(A) assisting such students in financial 
planning for enrollment in an institution of 
higher education; and 
(B) assisting such students in identifying 
and applying for financial aid (such as loans, 
grants, and scholarships) for an institution of 
higher education; 
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(4) provide opportunities for such students, ei-
ther online or in person, to learn about preparing for 
enrollment in an institution of higher education, in-
cluding by providing instruction to students about— 
(A) choosing the appropriate courses to 
prepare for postsecondary education; 
(B) applying to an institution of higher 
education; 
(C) building a student portfolio, which may 
be used when applying to an institution of high-
er education; 
(D) selecting an institution of higher edu-
cation; 
(E) choosing a major for the student’s 
postsecondary program of education or a career 
path; and 
(F) adapting to life at an institution of 
higher education; and 
(5) provide opportunities for such students, ei-
ther online or in person, to identify skills or inter-
ests, including career interests. 
(b) ACCESS TO AMERICAN DREAM ACCOUNT.— 
(1) IN GENERAL.—Subject to paragraphs (3) 
and (4), and in accordance with applicable Federal 
laws and regulations relating to privacy of informa-
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tion and the privacy of children, an eligible entity 
that receives a grant under this Act shall allow vest-
ed stakeholders, as described in paragraph (2), to 
have secure access, through the Internet, to an 
American Dream Account. 
(2) 
VESTED
STAKEHOLDERS.—The 
vested 
stakeholders that an eligible entity shall permit to 
access an American Dream Account are individuals 
(such as the student’s teachers, school counselors, 
counselors at an institution of higher education, 
school administrators, or other individuals) that are 
designated, in accordance with the Family Edu-
cational Rights and Privacy Act of 1974 (20 U.S.C. 
1232g), by the parent of a participating student in 
whose name such American Dream Account is held, 
as having permission to access the account. A stu-
dent’s parent may withdraw such designation from 
an individual at any time. 
(3) EXCEPTION
FOR
COLLEGE
SAVINGS
AC-
COUNT.—An eligible entity that receives a grant 
under this Act shall not be required to give vested 
stakeholders, as described in paragraph (2), access 
to the college savings account portion of a student’s 
American Dream Account. 
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(4) ADULT STUDENTS.—Notwithstanding para-
graphs (1), (2), and (3), if a participating student 
is age 18 or older, an eligible entity that receives a 
grant under this Act shall not provide access to such 
participating student’s American Dream Account 
without the student’s consent, in accordance with 
the Family Educational Rights and Privacy Act of 
1974 (20 U.S.C. 1232g). 
(5) INPUT OF STUDENT INFORMATION.—Stu-
dent data collected pursuant to subsection (a)(2)(A) 
shall be entered into an American Dream Account 
only by a school administrator or such administra-
tor’s designee. 
(c) PROHIBITION ON USE OF STUDENT INFORMA-
TION.—An eligible entity that receives a grant under this 
Act shall not use any student-level information or data for 
the purpose of soliciting, advertising, or marketing any fi-
nancial or non-financial consumer product or service that 
is offered by such eligible entity, or on behalf of any other 
person. 
(d) PROHIBITION ON THE USE OF GRANT FUNDS.— 
An eligible entity shall not use grant funds provided under 
this Act to provide the initial deposit into a college savings 
account portion of a student’s American Dream Account. 
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SEC. 7. REPORTS AND EVALUATIONS. 
(a) IN GENERAL.—Not later than 1 year after the 
Secretary has disbursed grants under this Act, and annu-
ally thereafter until each grant disbursed under section 4 
has ended, the Secretary shall prepare and submit a report 
to the appropriate committees of Congress, which shall in-
clude an evaluation of the effectiveness of the grant pro-
gram established under this Act. 
(b) CONTENTS.—The report described in subsection 
(a) shall— 
(1) list the grants that have been awarded 
under section 4(a); 
(2) include the number of students who have an 
American Dream Account established through a 
grant awarded under section 4(a); 
(3) provide data (including the interest accrued 
on college savings accounts that are part of an 
American Dream Account) in the aggregate, regard-
ing students who have an American Dream Account 
established through a grant awarded under section 
4(a), as compared to similarly situated students who 
do not have an American Dream Account; 
(4) identify best practices developed by the eli-
gible entities receiving grants under this Act; 
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(5) identify any issues related to student pri-
vacy and stakeholder accessibility to American 
Dream Accounts; 
(6) provide feedback from participating stu-
dents and the parents of such students about the 
grant program, including— 
(A) the impact of the program; 
(B) aspects of the program that are suc-
cessful; 
(C) aspects of the program that are not 
successful; and 
(D) any other data required by the Sec-
retary; and 
(7) provide recommendations for expanding the 
American Dream Accounts program. 
SEC. 8. ELIGIBILITY TO RECEIVE FEDERAL STUDENT FI-
NANCIAL AID. 
Notwithstanding any other provision of law, any 
funds that are in the college savings account portion of 
a student’s American Dream Account shall not affect such 
student’s eligibility to receive Federal student financial 
aid, including any Federal student financial aid under the 
Higher Education Act of 1965 (20 U.S.C. 1001), and 
shall not be considered in determining the amount of any 
such Federal student aid. 
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SEC. 9. AUTHORIZATION OF APPROPRIATIONS. 
There are authorized to be appropriated to carry out 
this Act $3,000,000 for fiscal year 2013, from existing 
Department of Education funds, and such sums as may 
be necessary for each subsequent fiscal year. 
SEC. 10. CONFORMING AMENDMENT. 
Section 480(j) of the Higher Education Act of 1965 
(20 U.S.C. 1087vv(j)) is amended by adding at the end 
the following: 
‘‘(5) Notwithstanding paragraph (1), amounts 
made available under the college savings account 
portion of an American Dream Account under the 
American Dream Accounts Act of 2013 shall not be 
treated as estimated financial assistance for pur-
poses of section 471(3).’’. 
Æ 
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