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(3) has an articulation agreement pursuant to 
section 486A of the Higher Education Act of 1965 
(20 U.S.C. 1093a); 
(4) is in compliance with section 137 of such 
Act (20 U.S.C. 1015f); and 
(5) meets any other requirements the Secretary 
may require. 
(c) GRANT DURATION; RENEWAL.—A grant awarded 
under this section shall be awarded to an eligible State 
for a 6-year period, except that if the Secretary determines 
that the eligible State has not made demonstrable progress 
in achieving the benchmarks developed pursuant to sub-
section (h) by the end of the third year of the grant period, 
non further grant funds shall be made available to the en-
tity after the date of such determination. 
(d) PRIORITY.—In awarding grants under this sec-
tion, the Secretary shall give priority to applications fo-
cused on serving low-income, nontraditional students (as 
defined in section 803(j) of the Higher Education Act of 
1965 (20 U.S.C. 1161c(j))), students who are dislocated 
workers, or students who are veterans, who do not have 
a bachelor’s degree. 
(e) FEDERAL AND NON-FEDERAL SHARE; SUPPLE-
MENT, NOT SUPPLANT.— 
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(1) FEDERAL SHARE.—The amount of the Fed-
eral share under this section for a fiscal year shall 
be not greater than 1⁄2 of the costs of the reform de-
scribed in subsection (g) that is carried out with the 
grant. 
(2) NON-FEDERAL SHARE.— 
(A) IN
GENERAL.—The amount of the 
Non-Federal share under this section for a fis-
cal year shall be not less than 1⁄2 of the costs 
of the reform described in subsection (g) that is 
carried out with the grant. The non-Federal 
share may be in cash or in kind, and may be 
provided from State resources, local resources, 
contributions from private organizations, or a 
combination thereof. 
(B) FINANCIAL HARDSHIP WAIVER.—The 
Secretary may waive or reduce the non-Federal 
share of an eligible State that has submitted an 
application under this section if the State dem-
onstrates a need for such waiver or reduction 
due to extreme financial hardship, as defined by 
the Secretary by regulation. 
(3) SUPPLEMENT, NOT SUPPLANT.—The Fed-
eral and non-Federal share required by this section 
shall be used to supplement, and not supplant, State 
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and private resources that would otherwise be ex-
pended to carry out the systematic reform of com-
munity colleges in a State. 
(f) APPLICATION.—An eligible State desiring to re-
ceive a grant under this section shall submit to the Sec-
retary an application at such time, in such manner, and 
containing such information as the Secretary may require. 
Such application shall describe the programs, service, and 
policies to be used by the State to achieve the systematic 
reform described in subsection (g), including— 
(1) the goals of such programs, services, and 
policies; 
(2) how the State will allocate grant funds to 
carry out such programs, services, and policies, in-
cluding identifying any State or private entity that 
will administer such programs, services, and policies; 
(3) how such programs, services, and policies 
will enable the State to— 
(A) meet the benchmarks developed pursu-
ant to subsection (h), and how the State will 
track and report the State’s progress in reach-
ing such benchmarks; and 
(B) benefit students attending all commu-
nity colleges within the State; 
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(4) how the State will use such programs, serv-
ices, and policies to establish quantifiable targets for 
improving graduation rates and employment-related 
outcomes; 
(5) how the State will serve high-need popu-
lations through such programs, services, and poli-
cies; 
(6) how the State will partner with the State 
public employment service and State or local work-
force investment boards in carrying out such pro-
grams, services, and policies; 
(7) how the State will evaluate such programs, 
services, and policies, which may include participa-
tion in national evaluations; and 
(8) how the State will involve community col-
leges and community college faculty in the planning, 
implementation, and evaluation of such programs, 
services, and policies. 
(g) USES OF FUNDS.—An eligible State receiving a 
grant under this section shall use the grant funds to im-
plement the systematic reform of community colleges lo-
cated in the State by carrying out programs, services, and 
policies that the Secretary has determined to have dem-
onstrated effectiveness based on the results of the evalua-
tion described in section 503(i). States shall allocate not 
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less than 90 percent of such grant funds to community 
colleges within the State. 
(h) BENCHMARKS.— 
(1) IN GENERAL.—Each eligible State receiving 
a grant under this section shall, in consultation with 
the Secretary, develop quantifiable benchmarks on 
the indicators identified in section 503(g)(1). 
(2) PROGRESS.—An eligible State receiving 
such a grant shall annually measure and report to 
the Secretary progress in achieving the benchmarks 
developed pursuant to paragraph (1). 
(i) REPORT.— 
(1) REPORTS TO THE SECRETARY.—Each eligi-
ble State receiving a grant under this section shall 
annually submit to the Secretary and the Secretary 
of Labor a report on such grant, including— 
(A) a description of the systematic reform 
carried out by the State using such grant; and 
(B) the outcome of such reform, including 
the State’s progress in achieving the bench-
marks developed under subsection (h). 
(2) REPORTS TO CONGRESS.—Not later than 6 
months after the end of the grant period, the Sec-
retary shall submit to the Committee on Health, 
Education, Labor, and Pensions of the Senate and 
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the Committee on Education and Labor of the 
House of Representatives a summary of the reports 
submitted under paragraph (1) with respect to such 
grant period. 
(j) SENSE OF CONGRESS.—It is the sense of Con-
gress that— 
(1) community colleges play an important role 
in preparing and training students seeking to enter 
the workforce; 
(2) it is vital that all States have access to the 
resources and assistance needed to compete for 
grants authorized under this section; and 
(3) in executing the grant program authorized 
under this section, the Secretary should make avail-
able any and all assistance, guidance, and support to 
States seeking to compete for grants authorized 
under this section and should work to ensure that 
such grants are distributed in a fair and equitable 
manner. 
SEC. 505. NATIONAL ACTIVITIES. 
(a) OPEN ONLINE EDUCATION.—From the amount 
appropriated to carry out this section, the Secretary is au-
thorized to make competitive grants to, or enter into con-
tracts with, institutions of higher education, philanthropic 
organizations, and other appropriate entities to develop, 
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