255
poena the production of information, documents, reports,
answers, records, accounts, papers, and other documentary
evidence pertaining to participation in any program under
this title. The production of any such records may be re-
quired from any place in a State.
‘‘(b) ENFORCEMENT.—In case of contumacy by, or re-
fusal to obey a subpoena issued to, any person, the Sec-
retary may request the Attorney General to invoke the aid
of any court of the United States where such person resides
or transacts business for a court order for the enforcement
of this section.’’.
SEC. 473. ADVISORY COMMITTEE ON STUDENT FINANCIAL
ASSISTANCE.
Section 491 (20 U.S.C. 1098) is amended—
(1) in subsection (b)—
(A) by inserting ‘‘staffing levels,’’ after ‘‘al-
locations and expenditures,’’ the first place it ap-
pears; and
(B) by striking the fourth and fifth sen-
tences and inserting the following: ‘‘Reports,
publications, and other documents, including
documents in electronic form, shall not be subject
to review by the Secretary.’’;
(2) in subsection (c)(1)—
256
(A) by striking ‘‘11 members’’ and inserting
‘‘15 members’’; and
(B) by striking ‘‘3 members’’ each place it
appears in subparagraphs (A) and (B) and in-
serting ‘‘5 members’’;
(3) in subsection (c)(2), by striking ‘‘7 members’’
and inserting ‘‘11 members’’;
(4) in subsection (e)—
(A) by striking everything after ‘‘except
that,’’ in paragraph (1) and inserting the follow-
ing:
‘‘within 90 days after the date of enactment of the Higher
Education Amendments of 1998, 2 additional members
shall be appointed by the President pro tempore of the Sen-
ate (one upon the recommendation of the Majority Leader
and one upon the recommendation of the Minority Leader)
and 2 additional members shall be appointed by the Speak-
er of the House (one upon the recommendation of the Major-
ity Leader and one upon the recommendation of the Minor-
ity Leader). Of the additional members—
‘‘(A) 2 shall be appointed for a term of 1 year;
‘‘(B) 1 shall be appointed for a term of 2 years;
and
‘‘(C) 1 shall be appointed for a term of 3 years.’’;
257
(B) by striking ‘‘Six members’’ in para-
graph (4) and inserting ‘‘Eight members’’; and
(C) by adding at the end the following new
paragraph:
‘‘(6) No officer or full-time employee of the United
States shall serve as members of the Advisory Committee.’’;
(5) by striking subsection (g) and inserting the
following:
‘‘(g) COMPENSATION AND EXPENSES.—Members of the
Advisory Committee may each receive reimbursement for
travel expenses incident to attending Advisory Committee
meetings, including per diem in lieu of subsistence, as au-
thorized by section 5703 of title 5, United States Code, for
persons in the Government service employed intermit-
tently.’’;
(6) in subsection (h)(1), by striking ‘‘may be
necessary by the Chairman without regard to’’ and
inserting ‘‘may be deemed necessary by the Chairman
without regard to personnel ceilings or’’;
(7) in subsection (i), by striking ‘‘$750,000’’ and
inserting ‘‘$850,000’’;
(8) by striking subsection (j) and inserting the
following:
‘‘(j) SPECIAL ANALYSES AND ACTIVITIES.—The com-
mittee shall—
258
‘‘(1) monitor and evaluate the modernization of
student financial aid systems and delivery processes;
‘‘(2) monitor and evaluate the implementation of
a performance-based organization within the Depart-
ment of Education and report to Congress, on not less
than an annual basis, including recommendations for
improvements; and
‘‘(3) assess the adequacy of current methods for
disseminating information about programs under this
title and recommend improvements, as appropriate,
regarding early needs assessment and information for
first-year high school students.’’;
(9) in subsection (k), by striking ‘‘1998’’ and in-
serting ‘‘2004’’; and
(10) by striking subsection (l).
SEC. 474. MEETINGS AND NEGOTIATED RULEMAKING.
Section 492 (20 U.S.C. 1098a) is amended to read as
follows:
‘‘SEC. 492. NEGOTIATED RULEMAKING.
‘‘(a) IN GENERAL.—
‘‘(1) REGULATION
DEVELOPMENT.—In develop-
ing regulations and revisions thereof under this title,
the Secretary shall obtain the advice and rec-
ommendations of individuals and representatives of
the groups involved in student financial assistance
259
programs under this title, such as students, legal as-
sistance organizations that represent students, institu-
tions of higher education, guaranty agencies, lenders,
secondary markets, loan servicers, guaranty agency
servicers, and collection agencies.
‘‘(2) INPUT.—Such advice and recommendations
may be obtained through such mechanisms as na-
tional meetings and electronic exchanges of informa-
tion.
‘‘(b) PROPOSED REGULATIONS.—After obtaining such
advice and recommendations, and prior to publishing any
proposed regulations and revisions thereof under this title
in the Federal Register, the Secretary shall prepare draft
regulations and submit such regulations to a negotiated
rulemaking process. In establishing the negotiated rule-
making process under this section, the Secretary shall—
‘‘(1) follow the procedural requirements used in
implementing section 1601(b) of the Elementary and
Secondary Education Act of 1965;
‘‘(2) select participants in the negotiations proc-
ess from individuals and groups participating in the
exchanges described in subsection (a)(1), including
both representatives of such groups from the District
of Columbia, and industry participants, and to the
extent possible, the Secretary shall select individuals
260
reflecting the diversity in the industry, representing
both large and small participants, as well as individ-
uals serving local areas and national markets;
‘‘(3) conduct the negotiations process in a timely
manner in order that final regulations may be issued
by the Secretary within the 240-day period described
in section 431(g) of the General Education Provisions
Act, and any subsequent revisions to regulations
under this title may be issued in accordance with the
master calendar provisions of section 482 of this title;
and
‘‘(4) prepare a transcript of the negotiated rule-
making proceedings that shall be available to the pub-
lic prior to the issuance of any final regulations.
‘‘(c) FEDERAL ADVISORY COMMITTEE ACT.—The Fed-
eral Advisory Committee Act shall not apply to activities
carried out under this section.’’.
PART H—PROGRAM INTEGRITY
SEC. 476. STATE POSTSECONDARY REVIEW PROGRAM.
(a) AMENDMENTS.—Part H of title IV is amended—
(1) in the heading of the part, by striking
‘‘TRIAD’’;
(2) by striking subpart 1 (20 U.S.C. 1099a
through 1099a–3); and
261
(3) by redesignating subparts 2 and 3 as sub-
parts 1 and 2, respectively.
(b) CONFORMING AMENDMENTS.—Section 496 (20
U.S.C. 1099b) is amended by striking ‘‘subpart 3’’ each
place it appears in subsections (j) and (k) and inserting
‘‘subpart 2’’.
SEC. 477. ACCREDITING AGENCY RECOGNITION.
(a) RECOGNITION.—
(1) The heading of subpart 1 of part H (as re-
designated by section 476(a)(3)) is amended by strik-
ing ‘‘Approval’’ and inserting ‘‘Recognition’’.
(2) The heading of section 496 is amended by
striking ‘‘APPROVAL’’ and inserting ‘‘RECOGNI-
TION’’.
(b) STANDARDS.—Section 496(a) is amended—
(1) by striking ‘‘STANDARDS’’ and inserting
‘‘CRITERIA’’;
(2) by striking ‘‘standards’’ each place it ap-
pears and inserting ‘‘criteria’’;
(3) in paragraph (5)—
(A) by striking ‘‘of accreditation’’ and in-
serting ‘‘for accreditation’’;
(B) by inserting ‘‘the quality (including the
quality of distance learning programs or courses)
of’’ before ‘‘the institution’s’’;
262
(C) in subparagraph (G), by striking ‘‘pro-
gram length and tuition and fees in relation to
the subject matters taught’’ and inserting ‘‘meas-
ures of program length’’;
(D) by striking subparagraph (J);
(E) in subparagraph (L), by inserting ‘‘the
most recent student loan default rate data pro-
vided by the Secretary and’’ after ‘‘including’’;
(F) by striking ‘‘and’’ at the end of sub-
paragraph (K);
(G) by inserting ‘‘and’’ after the semicolon
at the end of subparagraph (L);
(H) by redesignating subparagraphs (K)
and (L) as subparagraphs (J) and (K), respec-
tively;
(I) by inserting after subparagraph (K) (as
so redesignated) the following new subparagraph:
‘‘(L) refund policy;’’; and
(J) by striking ‘‘(J), and (L)’’ and inserting
‘‘(K) and (L)’’;
(4) in paragraph (7), by striking ‘‘State post-
secondary review entity’’ and inserting ‘‘State licens-
ing or authorizing agency’’; and
(5) in paragraph (8), by striking ‘‘State post-
secondary’’ and everything that follows through ‘‘is lo-
263
cated’’ and inserting ‘‘State licensing or authorizing
agency’’.
(c) OPERATING
PROCEDURES.—Section 496(c) is
amended—
(1) by striking ‘‘approved by the Secretary’’ and
inserting ‘‘recognized by the Secretary’’;
(2) in paragraph (1), by striking ‘‘(at least’’ and
everything that follows through ‘‘unannounced),’’ and
inserting ‘‘(which may include unannounced site vis-
its)’’; and
(3) in paragraph (3), by inserting before the
semicolon at the end the following: ‘‘, except that new
sites offered through telecommunications for programs
previously included in the scope of accreditation ap-
proval need not be subject to such on-site visits’’.
(d) CONFORMING AMENDMENTS.—Section 496 is fur-
ther amended—
(1) in subsection (d)—
(A) by striking ‘‘APPROVAL’’ in the heading
of such subsection and inserting ‘‘RECOGNITION’’;
and
(B) by striking ‘‘approved’’ and inserting
‘‘recognized’’;
(2) in subsection (f), by striking ‘‘approved’’ and
inserting ‘‘recognized’’;
264
(3) in subsection (g)—
(A) by striking ‘‘STANDARDS’’ and inserting
‘‘CRITERIA’’; and
(B) by striking ‘‘standards’’ and inserting
‘‘criteria’’;
(4) in subsection (k)(2), by striking ‘‘standards’’
and inserting ‘‘criteria’’;
(5) in subsection (l)—
(A) by striking ‘‘APPROVAL’’ in the heading
of such subsection and inserting ‘‘RECOGNITION’’;
(B) by striking ‘‘the standards’’ each place
it appears and inserting ‘‘its standards’’; and
(C) by striking ‘‘approval’’ and inserting
‘‘recognition’’; and
(6) in subsection (n)—
(A) by striking ‘‘standards’’ each place it
appears and inserting ‘‘criteria’’;
(B) in paragraph (3)—
(i) by striking ‘‘approval or dis-
approval’’ and inserting ‘‘recognition or de-
nial of recognition’’; and
(ii) by striking ‘‘approval process’’ and
inserting ‘‘recognition process’’; and
(C) by striking paragraph (4) and inserting
the following:
265
‘‘(4) The Secretary shall maintain sufficient docu-
mentation to support the conclusions reached in the recogni-
tion process, and, if the Secretary does not recognize any
accreditation agency or association, shall make publicly
available the reason for denying recognition, including ref-
erence to the specific criteria under this section which have
not been fulfilled.’’.
SEC. 478. ELIGIBILITY AND CERTIFICATION PROCEDURES.
(a) SINGLE APPLICATION FORM.—Section 498(b)(1)
(20 U.S.C. 1099c(b)(1)) is amended by striking ‘‘accredita-
tion, and capability’’ and inserting ‘‘accreditation, finan-
cial responsibility, and administrative capacity’’.
(b) FINANCIAL RESPONSIBILITY STANDARDS.—Section
498(c) is amended—
(1) in paragraph (1), in the matter preceding
subparagraph (A), by striking ‘‘is able’’ and inserting
‘‘has sufficient resources to ensure against the precipi-
tous closure of the institution and is able’’;
(2) in paragraph (2)—
(A) in the first sentence, by striking ‘‘oper-
ating losses, net worth, asset-to-liabilities ratios,
or operating fund deficits’’ and inserting ‘‘to ra-
tios that demonstrate financial responsibility,’’;
(B) in the second sentence, by inserting ‘‘,
public,’’ after ‘‘for profit’’; and
266
(C) by inserting before the period at the end
the following: ‘‘, and develop an appropriate and
cost effective process under this subpart that does
not duplicate other reporting requirements for
assessing and reviewing financial responsibil-
ity’’; and
(3) in paragraph (4)—
(A) in the first sentence, by striking ‘‘ratio
of current assets to current liabilities’’ and in-
serting ‘‘criteria’’; and
(B) in subparagraph (C), by striking ‘‘cur-
rent operating ratio requirement’’ and inserting
‘‘criteria imposed by the Secretary pursuant to
paragraph (2)’’.
(c) ADMINISTRATIVE CAPACITY.—Section 498(d)(1) is
amended—
(1) in subparagraph (A), by striking ‘‘student
aid programs; and’’ and inserting ‘‘student financial
assistance under this title;’’;
(2) by redesignating subparagraph (B) as sub-
paragraph (D); and
(3) by inserting after subparagraph (A) the fol-
lowing new subparagraphs:
‘‘(B) written procedures for, or written in-
formation relating to, each office with respect to,
267
the approval, disbursement, and delivery of stu-
dent financial assistance under this title;
‘‘(C)(i) a division of functions for authoriz-
ing payments of student financial assistance
under this title and the disbursement or delivery
of such assistance, so that no office at the institu-
tion has responsibility for both functions; and
‘‘(ii) an adequate system of checks and bal-
ances for internal control at the institution with
respect to student financial assistance under this
title; and’’.
(d) ACTIONS
ON APPLICATIONS.—Section 498(f) is
amended—
(1) by striking ‘‘shall conduct’’ and inserting
‘‘may conduct’’;
(2) by striking ‘‘may establish’’ and inserting
‘‘shall establish’’;
(3) by striking ‘‘may coordinate’’ and inserting
‘‘shall, to the extent practicable, coordinate’’; and
(4) by adding at the end the following new sen-
tence: ‘‘The Secretary may exempt from the site visit
requirement any institution that is participating in
the Quality Assurance Program established under sec-
tion 487A at the time such site visit would be re-
quired under this subsection.’’.
268
(e) TIME LIMITATIONS.—Section 498(g) is amended to
read as follows:
‘‘(g) TIME LIMITATIONS.—(1) After the expiration of
the certification of any institution or upon request for ini-
tial certification from an institution not previously cer-
tified, the Secretary may certify the eligibility for the pur-
poses of any program authorized under this title of each
such institution for a period not to exceed 6 years.
‘‘(2) The Secretary shall notify each institution of the
expiration of its eligibility no later than six months prior
to such expiration.’’.
(f) CONFORMING AMENDMENT.—Section 498(h)(2) is
amended by striking ‘‘approval’’ and inserting ‘‘recogni-
tion’’.
(g) PROVISIONAL CERTIFICATION.—Section 498(i) is
amended by adding at the end the following new paragraph:
‘‘(4)(A) The Secretary may provisionally certify an in-
stitution seeking approval of a change in ownership based
on the preliminary review by the Secretary of a materially
complete application that is received by the Secretary with-
in 10 business days of the transaction for which the ap-
proval is sought.
‘‘(B) A provisional certification under this paragraph
shall expire no later than the end of the month following
the month in which the transaction occurred, except that
269
if the Secretary has not issued a decision on the application
for the change of ownership within that period, the Sec-
retary may continue such provisional certification on a
month-to-month basis until such decision has been issued.’’.
SEC. 479. PROGRAM REVIEW AND DATA.
(a) GENERAL
AUTHORITY.—Section 498A(a) (20
U.S.C. 1099c–1(a)) is amended—
(1) in paragraph (2)—
(A) by striking ‘‘may give’’ and inserting
‘‘shall give’’;
(B) by inserting before the semicolon at the
end of subparagraph (C) the following: ‘‘, that
are not accounted for by changes in those pro-
grams’’;
(C) in subparagraph (D), by striking ‘‘the
appropriate’’ and everything that follows through
‘‘of this part’’ and inserting ‘‘the State licensing
or authorizing agency’’;
(D) by striking subparagraph (F); and
(E) by redesignating subparagraph (G) as
subparagraph (F); and
(2) in paragraph (3)(A), by inserting ‘‘relevant’’
after ‘‘all’’.
(b) 
SPECIAL
ADMINISTRATIVE
RULES.—Section
498A(b) is amended to read as follows:
270
‘‘(b) SPECIAL ADMINISTRATIVE RULES.—(1) In carry-
ing out paragraphs (1) and (2) of subsection (a), the Sec-
retary shall—
‘‘(A) establish guidelines designed to ensure uni-
formity of practice in the conduct of program reviews
of institutions; and
‘‘(B) inform the appropriate State agency and
accrediting agency or association whenever taking ac-
tion against an institution under this section, section
498, or section 432.
‘‘(2) The Secretary shall review the regulations of the
Department and the application of such regulations to en-
sure the uniformity of interpretation and application of the
regulations. In conducting such review, the Secretary shall
consult with relevant representatives of institutions partici-
pating in the programs authorized by this title.’’.
TITLE V—DEVELOPING
INSTITUTIONS
SEC. 501. ESTABLISHMENT OF NEW TITLE V.
Title V is amended to read as follows:
271
‘‘TITLE V—DEVELOPING
INSTITUTIONS
‘‘PART A—HISPANIC-SERVING INSTITUTIONS
‘‘SEC. 501. PROGRAM AUTHORIZED.
‘‘The Secretary shall provide grants and related assist-
ance to Hispanic-serving institutions to enable such institu-
tions to improve and expand their capacity to serve His-
panic and other low-income students.
‘‘SEC. 502. ELIGIBILITY; DEFINITIONS.
‘‘(a) DEFINITIONS.—For the purpose of this part:
‘‘(1) HISPANIC-SERVING INSTITUTION.—The term
‘Hispanic-serving institution’ means an institution of
higher education which—
‘‘(A) is an eligible institution;
‘‘(B) at the time of application, has an en-
rollment of undergraduate full-time equivalent
students that is at least 25 percent Hispanic stu-
dents; and
‘‘(C) provides assurances that not less than
50 percent of its Hispanic students are low-in-
come individuals.
‘‘(2) ELIGIBLE INSTITUTION.—The term ‘eligible
institution’ means—
‘‘(A) an institution of higher education—
272
‘‘(i) which has an enrollment of needy
students as required by subsection (b) of this
section;
‘‘(ii) except as provided in section
522(b), the average educational and general
expenditures of which are low, per full-time
equivalent undergraduate student, in com-
parison with the average educational and
general expenditures per full-time equiva-
lent undergraduate student of institutions
that offer similar instruction;
‘‘(iii) which is—
‘‘(I) legally authorized to provide,
and provides within the State, an edu-
cational program for which such insti-
tution awards a bachelor’s degree; or
‘‘(II) a junior or community col-
lege;
‘‘(iv) which is accredited by a nation-
ally recognized accrediting agency or asso-
ciation determined by the Secretary to be
reliable authority as to the quality of train-
ing offered or which is, according to such an
agency or association, making reasonable
progress toward accreditation;
273
‘‘(v) which meets such other require-
ments as the Secretary may prescribe; and
‘‘(vi) which is located in a State; and
‘‘(B) any branch of any institution of high-
er education described under subparagraph (A)
which by itself satisfies the requirements con-
tained in clauses (i) and (ii) of such subpara-
graph.
For purposes of the determination of whether an in-
stitution is an eligible institution under this para-
graph, the factor described under subparagraph (A)(i)
shall be given twice the weight of the factor described
under subparagraph (A)(ii).
‘‘(3) LOW-INCOME INDIVIDUAL.—The term ‘low-
income individual’ means an individual from a fam-
ily whose taxable income for the preceding year did
not exceed 150 percent of an amount equal to the pov-
erty level determined by using criteria of poverty es-
tablished by the Bureau of the Census.
‘‘(4) FULL-TIME
EQUIVALENT
STUDENTS.—The
term ‘full-time equivalent students’ means the sum of
the number of students enrolled full time at an insti-
tution, plus the full-time equivalent of the number of
students enrolled part time (determined on the basis
274
of the quotient of the sum of the credit hours of all
part-time students divided by 12) at such institution.
‘‘(5) JUNIOR
OR
COMMUNITY
COLLEGE.—The
term ‘junior or community college’ means an institu-
tion of higher education—
‘‘(A) that admits as regular students per-
sons who are beyond the age of compulsory school
attendance in the State in which the institution
is located and who have the ability to benefit
from the training offered by the institution;
‘‘(B) that does not provide an educational
program for which it awards a bachelor’s degree
(or an equivalent degree); and
‘‘(C) that—
‘‘(i) provides an educational program
of not less than 2 years that is acceptable
for full credit toward such a degree, or
‘‘(ii) offers a 2-year program in engi-
neering, mathematics, or the physical or bi-
ological sciences, designed to prepare a stu-
dent to work as a technician or at the
semiprofessional level in engineering, sci-
entific, or other technological fields requir-
ing the understanding and application of
275
basic engineering, scientific, or mathemati-
cal principles of knowledge.
‘‘(6) EDUCATIONAL
AND
GENERAL
EXPENDI-
TURES.—For the purpose of this part, the term ‘edu-
cational and general expenditures’ means the total
amount expended by an institution of higher edu-
cation for instruction, research, public service, aca-
demic support (including library expenditures), stu-
dent services, institutional support, scholarships and
fellowships, operation and maintenance expenditures
for the physical plant, and any mandatory transfers
which the institution is required to pay by law.
‘‘(7) ENDOWMENT
FUND.—For the purpose of
this part, the term ‘endowment fund’ means a fund
that—
‘‘(A) is established by State law, by an in-
stitution of higher education, or by a foundation
that is exempt from Federal income taxation;
‘‘(B) is maintained for the purpose of gener-
ating income for the support of the institution;
and
‘‘(C) does not include real estate.
‘‘(b) ENROLLMENT OF NEEDY STUDENTS.—For the
purpose of this part, the term ‘enrollment of needy students’
276
means an enrollment at an institution of higher education
or a junior or community college which includes—
‘‘(1) at least 50 percent of the degree students so
enrolled who are receiving need-based assistance
under title IV of this Act in the second fiscal year
preceding the fiscal year for which the determination
is being made (other than loans for which an interest
subsidy is paid pursuant to section 428), or
‘‘(2) a substantial percentage of students receiv-
ing Pell Grants in the second fiscal year preceding
the fiscal year for which determination is being made,
in comparison with the percentage of students receiv-
ing Pell Grants at all such institutions in the second
fiscal year preceding the fiscal year for which the de-
termination is made, unless the requirement of this
subdivision is waived under section 522(a).
‘‘SEC. 503. AUTHORIZED ACTIVITIES.
‘‘(a) TYPES
OF ACTIVITIES AUTHORIZED.—Grants
awarded under this part shall be used by Hispanic-serving
institutions of higher education to assist such institutions
to plan, develop, undertake, and carry out programs.
‘‘(b) AUTHORIZED
ACTIVITIES.—Grants awarded
under this section shall be used for one or more of the follow-
ing activities:
277
‘‘(1) purchase, rental, or lease of scientific or lab-
oratory equipment for educational purposes, includ-
ing instructional and research purposes;
‘‘(2) construction, maintenance, renovation, and
improvement in classrooms, libraries, laboratories,
and other instructional facilities;
‘‘(3) support of faculty exchanges, faculty devel-
opment, curriculum development, academic instruc-
tion, and faculty fellowships to assist in attaining ad-
vanced degrees in their field of instruction;
‘‘(4) purchase of library books, periodicals, and
other educational materials, including telecommuni-
cations program material;
‘‘(5) tutoring, counseling, and student service
programs designed to improve academic success;
‘‘(6) funds management, administrative manage-
ment, and acquisition of equipment for use in
strengthening funds management;
‘‘(7) joint use of facilities, such as laboratories
and libraries;
‘‘(8) establishing or improving a development of-
fice to strengthen or improve contributions from
alumni and the private sector;
‘‘(9) establishing or improving an endowment
fund;
278
‘‘(10) creating or improving facilities for Inter-
net or other distance learning academic instruction
capabilities, including purchase or rental of tele-
communications technology equipment or services;
‘‘(11) establishing or enhancing a program of
teacher education designed to qualify students to teach
in public elementary and secondary schools;
‘‘(12) establishing community outreach programs
which will encourage elementary and secondary school
students to develop academic skills and the interest to
pursue postsecondary education;
‘‘(13) improving and expanding graduate and
professional opportunities for Hispanic students; and
‘‘(14) other activities proposed in the application
submitted pursuant to section 504 that—
‘‘(A) contribute to carrying out the purposes
of this section; and
‘‘(B) are approved by the Secretary as part
of the review and acceptance of such application.
‘‘(c) ENDOWMENT FUND LIMITATIONS.—
‘‘(1) PORTION OF GRANT.—An institution may
not use more than 20 percent of its grant under this
part for any fiscal year for establishing or improving
an endowment fund.
279
‘‘(2) MATCHING REQUIRED.—An institution that
uses any portion of its grant under this part for any
fiscal year for establishing or improving an endow-
ment fund shall provide an equal or greater amount
for such purposes from non-Federal funds.
‘‘(3) REGULATIONS.—The Secretary shall publish
rules and regulations specifically governing the use of
funds for establishing or improving an endowment
fund.
‘‘SEC. 504. APPLICATION PROCESS.
‘‘(a) INSTITUTIONAL ELIGIBILITY.—Each Hispanic-
serving institution desiring to receive assistance under this
part shall submit to the Secretary such enrollment data as
may be necessary to demonstrate that it is a Hispanic-serv-
ing institution, along with such other information and data
as the Secretary may by regulation require.
‘‘(b) APPLICATIONS.—Any institution which is deter-
mined by the Secretary to be a Hispanic-serving institution
(on the basis of the information and data submitted under
subsection (a)) may submit an application for assistance
under this section to the Secretary. Such application shall
include—
‘‘(1) a 5-year plan for improving the assistance
provided by the Hispanic-serving institution to His-
panic and other low-income students; and
280
‘‘(2) such other information and assurance as the
Secretary may require.
‘‘(c) PRIORITY.—The Secretary shall give priority to
applications that contain satisfactory evidence that such in-
stitution has entered into or will enter into a collaborative
arrangement with at least one local educational agency or
community-based organization having demonstrated effec-
tiveness to provide such agency with assistance (from funds
other than funds provided under this part) in reducing His-
panic dropout rates, improving Hispanic rates of academic
achievement, and increasing the rates at which Hispanic
high school graduates enroll in higher education.
‘‘(d) SPECIAL RULE.—For the purposes of this part,
no Hispanic-serving college or university which is eligible
for and receives funds under this part may concurrently
receive other funds under title III.
‘‘SEC. 505. DURATION OF GRANT.
‘‘(a) AWARD PERIOD.—The Secretary may award a
grant to an eligible institution under this part for 5 years,
except that no institution shall be eligible to secure a subse-
quent 5-year grant award under this part until two years
have elapsed since the expiration of its most recent 5-year
grant award.
‘‘(b) LIMITATIONS.—In awarding grants under this
part the Secretary shall give priority to applicants who are
281
not already receiving a grant under this part, except that
for the purpose of this subsection a grant under section
524(a)(1) shall not be considered a grant under this part.
‘‘(c) PLANNING GRANTS.—Notwithstanding subsection
(a), the Secretary may award a grant to an eligible institu-
tion under this part for a period of one year for the purpose
of preparation of plans and applications for a grant under
this part.
‘‘PART B—GENERAL PROVISIONS
‘‘SEC. 521. APPLICATIONS FOR ASSISTANCE.
‘‘(a) APPLICATIONS.—
‘‘(1) APPLICATIONS REQUIRED.—Any institution
which is eligible for assistance under this title shall
submit to the Secretary an application for assistance
at such time, in such form, and containing such in-
formation, as may be necessary to enable the Sec-
retary to evaluate its need for assistance. Subject to
the availability of appropriations to carry out this
title, the Secretary may approve an application for a
grant under this title only if the Secretary determines
that—
‘‘(A) the application meets the requirements
of subsection (b);
282
‘‘(B) the applicant is eligible for assistance
in accordance with the part of this title under
which the assistance is sought; and
‘‘(C) the applicant’s performance goals are
sufficiently rigorous as to meet the purposes of
this title and the performance objectives and in-
dicators for this title established by the Secretary
pursuant to the Government Performance and
Results Act.
‘‘(2) PRELIMINARY APPLICATIONS.—In carrying
out paragraph (1), the Secretary shall develop a pre-
liminary application for use by eligible institutions
applying under part A prior to the submission of the
principal application.
‘‘(b) CONTENTS.—An institution, in its application for
a grant, shall—
‘‘(1) set forth, or describe how the institution will
develop, a comprehensive development plan to
strengthen the institution’s academic quality and in-
stitutional management, and otherwise provide for in-
stitutional self-sufficiency and growth (including
measurable objectives for the institution and the Sec-
retary to use in monitoring the effectiveness of activi-
ties under this title);
283
‘‘(2) set forth policies and procedures to ensure
that Federal funds made available under this title for
any fiscal year will be used to supplement and, to the
extent practical, increase the funds that would other-
wise be made available for the purposes of section
503, and in no case supplant those funds;
‘‘(3) set forth policies and procedures for evaluat-
ing the effectiveness in accomplishing the purpose of
the activities for which a grant is sought under this
title;
‘‘(4) provide for such fiscal control and fund ac-
counting procedures as may be necessary to ensure
proper disbursement of and accounting for funds
made available to the applicant under this title;
‘‘(5) provide (A) for making such reports, in
such form and containing such information, as the
Secretary may require to carry out the functions
under this title and the Government Performance and
Results Act, including not less than one report annu-
ally setting forth the institution’s progress toward
achieving the objectives for which the funds were
awarded, and (B) for keeping such records and af-
fording such access thereto, as the Secretary may find
necessary to assure the correctness and verification of
such reports;
284
‘‘(6) provide that the institution will comply
with the limitations set forth in section 526;
‘‘(7) describe in a comprehensive manner any
proposed project for which funds are sought under the
application and include—
‘‘(A) a description of the various compo-
nents of the proposed project, including the esti-
mated time required to complete each such com-
ponent;
‘‘(B) in the case of any development project
which consists of several components (as de-
scribed by the applicant pursuant to subpara-
graph (A)), a statement identifying those compo-
nents which, if separately funded, would be
sound investments of Federal funds and those
components which would be sound investments of
Federal funds only if funded under this title in
conjunction with other parts of the development
project (as specified by the applicant);
‘‘(C) an evaluation by the applicant of the
priority given any proposed project for which
funds are sought in relation to any other projects
for which funds are sought by the applicant
under this title, and a similar evaluation re-
garding priorities among the components of any
285
single proposed project (as described by the ap-
plicant pursuant to subparagraph (A));
‘‘(D) a detailed budget showing the manner
in which funds for any proposed project would
be spent by the applicant; and
‘‘(E) a detailed description of any activity
which involves the expenditure of more than
$25,000, as identified in the budget referred to in
subparagraph (D); and
‘‘(8) include such other information as the Sec-
retary may prescribe.
‘‘(c) PRIORITY CRITERIA PUBLICATION REQUIRED.—
The Secretary shall publish in the Federal Register, pursu-
ant to chapter 5 of title 5, United States Code, all policies
and procedures required to exercise the authority set forth
in subsection (a). No other criteria, policies, or procedures
shall apply.
‘‘(d) ELIGIBILITY DATA.—The Secretary shall use the
most recent and relevant data concerning the number and
percentage of students receiving need-based assistance under
title IV of this Act in making eligibility determinations and
shall advance the base-year forward following each annual
grant cycle.
286
‘‘SEC. 522. WAIVER AUTHORITY AND REPORTING REQUIRE-
MENT.
‘‘(a) WAIVER REQUIREMENTS; NEED-BASED ASSIST-
ANCE STUDENTS.—The Secretary may waive the require-
ments set forth in section 502(a)(2)(A)(i) in the case of an
institution—
‘‘(1) which is extensively subsidized by the State
in which it is located and charges low or no tuition;
‘‘(2) which serves a substantial number of low-
income students as a percentage of its total student
population;
‘‘(3) which is contributing substantially to in-
creasing higher education opportunities for education-
ally disadvantaged, underrepresented, or minority
students, who are low-income individuals;
‘‘(4) which is substantially increasing higher
educational opportunities for individuals in rural or
other isolated areas which are unserved by postsecond-
ary institutions; or
‘‘(5) wherever located, if the Secretary determines
that the waiver will substantially increase higher edu-
cation opportunities appropriate to the needs of His-
panic Americans.
‘‘(b) WAIVER DETERMINATIONS; EXPENDITURES.—(1)
The Secretary may waive the requirements set forth in sec-
tion 502(a)(2)(A)(ii) if the Secretary determines, based on
287
persuasive evidence submitted by the institution, that the
institution’s failure to meet that criterion is due to factors
which, when used in the determination of compliance with
such criterion, distort such determination, and that the in-
stitution’s designation as an eligible institution under part
A is otherwise consistent with the purposes of such part.
‘‘(2) The Secretary shall submit to the Congress every
other year a report concerning the institutions which, al-
though not satisfying the criterion contained in section
502(a)(2)(A)(ii), have been determined to be eligible institu-
tions under part A institutions which enroll significant
numbers of Black American, Hispanic, Native American,
Asian American, or Native Hawaiian students under part
A, as the case may be. Such report shall—
‘‘(A) identify the factors referred to in paragraph
(1) which were considered by the Secretary as factors
that distorted the determination of compliance with
section 502(a)(2)(A)(ii); and
‘‘(B) contain a list of each institution deter-
mined to be an eligible institution under part A in-
cluding a statement of the reasons for each such deter-
mination.
‘‘SEC. 523. APPLICATION REVIEW PROCESS.
‘‘(a) REVIEW PANEL.—All applications submitted
under this title by institutions of higher education shall be
288
read by a panel of readers composed of individuals selected
by the Secretary. The Secretary shall assure that no indi-
vidual assigned under this section to review any applica-
tion has any conflict of interest with regard to the applica-
tion which might impair the impartiality with which the
individual conducts the review under this section.
‘‘(2) All readers selected by the Secretary shall receive
thorough instruction from the Secretary regarding the eval-
uation process for applications submitted under this title
and consistent with the provisions of this title, including—
‘‘(A) an enumeration of the factors to be used to
determine the quality of applications submitted under
this title; and
‘‘(B) an enumeration of the factors to be used to
determine whether a grant should be awarded for a
project under this title, the amount of any such grant,
and the duration of any such grant.
‘‘(b) RECOMMENDATIONS
OF PANEL.—In awarding
grants under this title, the Secretary shall take into consid-
eration the recommendations of the panel made under sub-
section (a).
‘‘(c) NOTIFICATION.—Not later than June 30 of each
year, the Secretary shall notify each institution of higher
education making an application under this title of—
289
‘‘(1) the scores given the applicant by the panel
pursuant to this section;
‘‘(2) the recommendations of the panel with re-
spect to such application; and
‘‘(3) the reasons for the decision of the Secretary
in awarding or refusing to award a grant under this
title, and any modifications, if any, in the rec-
ommendations of the panel made by the Secretary.
‘‘SEC. 524. COOPERATIVE ARRANGEMENTS.
‘‘(a) GENERAL AUTHORITY.—The Secretary may make
grants to encourage cooperative arrangements with funds
available to carry out part A, between institutions eligible
for assistance under part A and between such institutions
and institutions not receiving assistance under this title for
the activities described in section 503 so that the resources
of the cooperating institutions might be combined and
shared to achieve the purposes of such part and avoid costly
duplicative efforts and to enhance the development of part
A eligible institutions.
‘‘(b) PRIORITY.—The Secretary shall give priority to
grants for the purposes described under subsection (a) when-
ever the Secretary determines that the cooperative arrange-
ment is geographically and economically sound or will ben-
efit the applicant institution.
290
‘‘(c) DURATION.—Grants to institutions having a co-
operative arrangement may be made under this section for
a period as determined under section 505.
‘‘SEC. 525. ASSISTANCE TO INSTITUTIONS UNDER OTHER
PROGRAMS.
‘‘(a) ASSISTANCE
ELIGIBILITY.—Each institution
which the Secretary determines to be an institution eligible
under part A may be eligible for waivers in accordance with
subsection (b).
‘‘(b) WAIVER APPLICABILITY.—(1) Subject to, and in
accordance with, regulations promulgated for the purpose
of this section, in the case of any application by an institu-
tion referred to in subsection (a) for assistance under any
programs specified in paragraph (2), the Secretary is au-
thorized, if such application is otherwise approvable, to
waive any requirement for a non-Federal share of the cost
of the program or project, or, to the extent not inconsistent
with other law, to give, or require to be given, priority con-
sideration of the application in relation to applications
from other institutions.
‘‘(2) The provisions of this section shall apply to any
program authorized by title IV or VII of this Act.
‘‘(c) LIMITATION.—The Secretary shall not waive,
under subsection (b), the non-Federal share requirement for
any program for applications which, if approved, would re-
291
quire the expenditure of more than 10 percent of the appro-
priations for the program for any fiscal year.
‘‘SEC. 526. LIMITATIONS.
The funds appropriated under section 528 may not be
used—
‘‘(1) for a school or department of divinity or
any religious worship or sectarian activity;
‘‘(2) for an activity that is inconsistent with a
State plan for desegregation of higher education ap-
plicable to such institution;
‘‘(3) for an activity that is inconsistent with a
State plan of higher education applicable to such in-
stitution; or
‘‘(4) for purposes other than the purposes set
forth in the approved application under which the
funds were made available to the institution.
‘‘SEC. 527. PENALTIES.
Whoever, being an officer, director, agent, or employee
of, or connected in any capacity with, any recipient of Fed-
eral financial assistance or grant pursuant to this title em-
bezzles, willfully misapplies, steals, or obtains by fraud any
of the funds which are the subject of such grant or assist-
ance, shall be fined not more than $10,000 or imprisoned
for not more than 2 years, or both.
292
‘‘SEC. 528. AUTHORIZATIONS OF APPROPRIATIONS.
‘‘(a) AUTHORIZATIONS.—There are authorized to be
appropriated to carry out part A, $80,000,000 for fiscal
year 1999, and such sums as may be necessary for each
of the 4 succeeding fiscal years.
‘‘(b) USE OF MULTIPLE YEAR AWARDS.—In the event
of a multiple year award to any institution under this title,
the Secretary shall make funds available for such award
from funds appropriated for this title for the fiscal year
in which such funds are to be used by the recipient.’’.
TITLE VI—INTERNATIONAL AND
GRADUATE EDUCATION PRO-
GRAMS
SEC. 
601. 
INTERNATIONAL 
AND 
FOREIGN 
LANGUAGE
STUDIES.
(a) STATUTORY STRUCTURE.—Title VI is amended—
(1) by striking
‘‘PART A—INTERNATIONAL AND FOREIGN
LANGUAGE STUDIES’’
and inserting the following:
‘‘PART A—INTERNATIONAL EDUCATION
‘‘Subpart 1—International and Foreign Language
Studies’’;
(2) by striking
293
‘‘PART B—BUSINESS AND INTERNATIONAL
EDUCATION PROGRAMS’’
and inserting the following:
‘‘Subpart 2—Business and International Education
Programs’’;
(3) by striking
‘‘PART C—INSTITUTE FOR INTERNATIONAL
PUBLIC POLICY’’
and inserting the following:
‘‘Subpart 3—Institute for International Public
Policy’’; and
(4) by striking
‘‘PART D—GENERAL PROVISIONS’’
and inserting the following:
‘‘Subpart 4—General Provisions’’.
(b) FINDINGS
AND
PURPOSES.—Section 601 (20
U.S.C. 1121) is amended to read as follows:
‘‘SEC. 601. FINDINGS AND PURPOSES.
‘‘(a) FINDINGS.—The Congress finds as follows:
‘‘(1) The security, stability, and economic vital-
ity of the United States in a complex global era de-
pend upon American experts in and citizens knowl-
edgeable about world regions, foreign languages and
international affairs, as well as on a strong research
base in these areas.
294
‘‘(2) Advances in communications technology
and the growth of regional and global problems make
knowledge of other countries and the ability to com-
municate in other languages more essential to the
promotion of mutual understanding and cooperation
among nations and their peoples.
‘‘(3) Dramatic post-Cold War changes in the
world’s geopolitical and economic landscapes are cre-
ating needs for American expertise and knowledge
about a greater diversity of less commonly taught for-
eign languages and nations of the world.
‘‘(4) Systematic efforts are necessary to enhance
the capacity of institutions of higher education in the
United States and to encourage a broader cross-sec-
tion of institutions of higher education to develop and
expand programs for producing graduates with inter-
national and foreign language expertise and knowl-
edge, and research on such areas, in a variety of dis-
ciplines and at all levels of graduate and undergradu-
ate education.
‘‘(5) Cooperative efforts among the Federal Gov-
ernment, institutions of higher education, and the
private sector are necessary to promote the generation
and dissemination of information about world re-
gions, foreign languages, and international affairs
295
throughout education, government, business, civic,
and nonprofit sectors in the United States.
‘‘(b) PURPOSES.—The purposes of this part are—
‘‘(1)(A) to support centers, programs and fellow-
ships in institutions of higher education in the
United States for producing increased numbers of
trained personnel and research in foreign languages,
area and other international studies;
‘‘(B) to develop a pool of international experts to
meet national needs;
‘‘(C) to develop and validate specialized mate-
rials and techniques for foreign language acquisition
and fluency, emphasizing (but not limited to) the less
commonly taught languages;
‘‘(D) to promote access to research and training
overseas; and
‘‘(E) to advance the internationalization of a va-
riety of disciplines throughout undergraduate and
graduate education;
‘‘(2) to support cooperative efforts promoting ac-
cess to and the dissemination of international and
foreign language knowledge, teaching materials and
research throughout education, government, business,
civic and nonprofit sectors in the United States
through the use of advanced technologies; and
296
‘‘(3) to coordinate the programs of the Federal
Government in the areas of foreign language, area
and other international studies, including profes-
sional international affairs education and research.’’.
(c) GRADUATE AND UNDERGRADUATE NATIONAL RE-
SOURCE CENTERS.—
(1) NATIONAL
RESOURCE
CENTERS.—Section
602(a) (20 U.S.C. 1122(a)) is amended—
(A) in the heading, by striking ‘‘NATIONAL
LANGUAGE AND AREA CENTERS AUTHORIZED’’
and inserting ‘‘NATIONAL RESOURCE CENTERS
FOR FOREIGN LANGUAGE AND AREA OR INTER-
NATIONAL STUDIES AUTHORIZED’’;
(B) in paragraph (1)(A), by striking ‘‘com-
prehensive language and area centers’’ and in-
serting ‘‘comprehensive foreign language and
area or international studies centers’’;
(C) in paragraph (1)(B), by striking ‘‘lan-
guage and area centers’’ and inserting ‘‘foreign
language and area or international studies cen-
ters’’; and
(D) by striking paragraph (2) and insert-
ing the following:
‘‘(2) AUTHORIZED ACTIVITIES.—
297
‘‘(A) IN GENERAL.—Any grant made under
paragraph (1) may be used to pay all or part
of the cost of establishing or operating a center
or program, in accordance with this subsection.
‘‘(B) MANDATORY ACTIVITIES.—Activities to
be conducted by centers assisted under this sub-
section shall include—
‘‘(i) support for the instruction of for-
eign languages and the offering of courses in
a variety of nonlanguage disciplines that
cover the center’s subject area or topic, and
the incorporation of such instruction in
baccalaureate and graduate programs of
study in a variety of disciplinary, inter-
disciplinary, or professional fields;
‘‘(ii) support for teaching and research
materials, including library acquisitions, in
the center’s subject area or topic;
‘‘(iii) programs of outreach or linkage
with State and local educational agencies,
postsecondary education institutions at all
levels, 
professional 
schools, 
government,
business, media, or the general public; and