(d) for any award year that is more than the non- 
Federal share requirement under subsection (b)(2) 
and the maintenance of expenditures requirement 
under paragraphs (4) and (5) of subsection (d), the 
Secretary shall provide to the State or eligible In-
dian entity an amount equal to such additional fund-
ing provided by the State or eligible Indian entity, 
which amount provided by the Secretary may be 
used for the activities described in subsection (f)(2). 
‘‘(d) STATE AND ELIGIBLE INDIAN ENTITY ELIGI-
BILITY REQUIREMENTS.—In order to be eligible to receive 
an allotment under this section for an award year, a State 
or eligible Indian entity shall comply with the following: 
‘‘(1) Ensure that public institutions of higher 
education in the State or Tribal Colleges and Uni-
versities of the eligible Indian entity maintain ex-
penditures on instruction per full-time equivalent 
student at levels that are equal to or exceed the ex-
penditures on instruction per full-time equivalent 
student for award year 2015–2016. 
‘‘(2) Ensure that tuition and required fees for 
eligible students in the State’s community college 
system or eligible students in the 2-year Tribal Col-
leges and Universities of the eligible Indian entity 
are eliminated. 
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‘‘(3)(A) Ensure that tuition and required fees 
for eligible students attending the State’s public 4- 
year institutions of higher education or eligible stu-
dents attending the 4-year Tribal Colleges and Uni-
versities of the eligible Indian entity are eliminated 
as follows: 
‘‘(i) For the first award year of the pro-
gram under this section, the State or eligible 
Indian entity shall eliminate tuition and re-
quired fees for such students— 
‘‘(I) who are dependent students, 
whose parents’ adjusted gross income for 
the taxable year that is 1 year prior to the 
taxable year that ends immediately prior to 
the beginning of the award year is equal to 
or less than $125,000; and 
‘‘(II) who are independent students, 
whose adjusted gross income for the tax-
able year that is 1 year prior to the taxable 
year that ends immediately prior to the be-
ginning of the award year is equal to or 
less than $125,000. 
‘‘(ii) For each award year after the first 
award year of the program under this section, 
the State or eligible Indian entity shall elimi-
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nate tuition and required fees for such stu-
dents— 
‘‘(I) who are dependent students, 
whose parents’ adjusted gross income for 
the taxable year that is 1 year prior to the 
taxable year that ends immediately prior to 
the beginning of the award year is equal to 
or less than the applicable amount; and 
‘‘(II) who are independent students, 
whose adjusted gross income for the tax-
able year that is 1 year prior to the taxable 
year that ends immediately prior to the be-
ginning of the award year is equal to or 
less than the applicable amount. 
‘‘(B)(i) In this paragraph, the term ‘applicable 
amount’ means an amount equal to, for any award 
year beginning after the calendar year that precedes 
the calendar year in which the first award year of 
the program under this section begins, the greater 
of— 
‘‘(I) the amount determined under this 
subparagraph for the preceding award year, or 
‘‘(II) an amount equal to the product of— 
‘‘(aa) $125,000, and 
‘‘(bb) the ratio of— 
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‘‘(AA) the national average wage 
index (as defined in section 209(k)(1) 
of the Social Security Act (42 U.S.C. 
409(k)(1))) for the calendar year pre-
ceding the calendar year in which the 
applicable award year begins, to 
‘‘(BB) the national average wage 
index (as so defined) for 2016. 
‘‘(ii) If any amount determined under clause (i) 
is not a multiple of $100, such amount shall be 
rounded to the nearest multiple of $100. 
‘‘(4) Maintain State operating expenditures per 
full-time equivalent student for public institutions of 
higher education in the State, or operating expendi-
tures per full-time equivalent student for Tribal Col-
leges and Universities of the eligible Indian entity, 
excluding the amount of funds provided under this 
section, at a level that is equal to or exceeds the 
level of such support for award year 2015–2016. 
‘‘(5) Maintain State expenditures on need-based 
financial aid programs for enrollment in public insti-
tutions of higher education in the State or expendi-
tures on need-based financial aid programs for en-
rollment in Tribal Colleges and Universities of the 
eligible Indian entity at a level that is equal to or 
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exceeds the level of such support for award year 
2015–2016. 
‘‘(6) Ensure public institutions of higher edu-
cation in the State or Tribal Colleges and Univer-
sities of the eligible Indian entity maintain funding 
for institutional need-based student financial aid in 
an amount that is equal to or exceeds the level of 
such support for award year 2015–2016. 
‘‘(7) Provide an assurance that not later than 
5 years after the first award year for which the 
grant is awarded, not less than 75 percent of in-
struction at public institutions of higher education in 
the State or Tribal Colleges and Universities of the 
eligible Indian entity is provided by tenured or ten-
ure-track faculty. 
‘‘(8) Require that public institutions of higher 
education in the State or Tribal Colleges and Uni-
versities of the eligible Indian entity provide, for 
each student enrolled at the institution who receives 
the maximum Federal Pell Grant award under sub-
part 1 of part A of title IV, institutional student fi-
nancial aid (excluding student loans) in an amount 
equal to 100 percent of the difference between— 
‘‘(A) the cost of attendance at such institu-
tion; and 
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‘‘(B) the sum of— 
‘‘(i) the amount of the maximum Fed-
eral Pell Grant award; and 
‘‘(ii) the student’s expected family 
contribution. 
‘‘(9) Ensure that public institutions of higher 
education in the State or Tribal Colleges and Uni-
versities of the eligible Indian entity not adopt poli-
cies to reduce enrollment. 
‘‘(10) Provide an assurance that public institu-
tions of higher education in the State or Tribal Col-
leges and Universities of the eligible Indian entity 
will not charge out of State students an amount that 
exceeds the marginal cost of attending institutions of 
higher education in the State or Tribal Colleges and 
Universities of the eligible Indian entity. 
‘‘(11) Provide an assurance that public institu-
tions of higher education in the State or Tribal Col-
leges and Universities of the eligible Indian entity 
that charge non-eligible in-State students tuition and 
required fees, will not charge such students a rate 
that exceeds the rate for the last year that tuition 
and required fees were charged to eligible students, 
increased by the percentage change for subsequent 
years in the expenditures per full-time equivalent eli-
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gible student by the State or eligible entity that is 
necessary to continue to eliminate tuition and re-
quired fees for eligible students. 
‘‘(e) SUBMISSION
AND
CONTENTS
OF
APPLICA-
TION.—For each award year for which a State or eligible 
Indian entity desires a grant under this section, an appli-
cation shall be submitted to the Secretary at such time, 
in such manner, and containing such information as the 
Secretary may require. Such application shall be sub-
mitted by— 
‘‘(1) in the case of a State, the State agency 
with jurisdiction over higher education or another 
agency designated by the Governor or chief executive 
of the State to administer the program under this 
section; and 
‘‘(2) in the case of an eligible Indian entity, the 
eligible Indian entity or a Tribal College or Univer-
sity of the eligible Indian entity. 
‘‘(f) USE OF FUNDS.— 
‘‘(1) IN GENERAL.—A State or eligible Indian 
entity that receives a grant under this section shall 
use the grant funds and the non-Federal share 
funds required under this section— 
‘‘(A) to eliminate tuition and required fees 
for all eligible students at community colleges 
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