I 
113TH CONGRESS 
2D SESSION 
H. R. 4984 
To amend the loan counseling requirements under the Higher Education 
Act of 1965, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
JUNE 26, 2014 
Mr. GUTHRIE (for himself, Mr. HUDSON, and Mr. KLINE) introduced the fol-
lowing bill; which was referred to the Committee on Education and the 
Workforce 
A BILL 
To amend the loan counseling requirements under the Higher 
Education Act of 1965, and for other purposes. 
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 ‘‘Empowering Students 
Through Enhanced Financial Counseling Act’’. 
SEC. 2. ANNUAL COUNSELING. 
Section 485(l) of the Higher Education Act of 1965 
(20 U.S.C. 1092(l)) is amended— 
(1) in the subsection heading, by striking ‘‘EN-
TRANCE’’ and inserting ‘‘ANNUAL’’; 
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(2) in paragraph (1)— 
(A) in the paragraph heading, by striking 
‘‘DISBURSEMENT’’ 
and 
inserting 
‘‘ACCEPT-
ANCE’’; 
(B) in subparagraph (A)— 
(i) in the matter preceding clause 
(i)— 
(I) by striking ‘‘at or prior to’’ 
and inserting ‘‘prior to or in conjunc-
tion with’’; and 
(II) by striking ‘‘a disbursement 
to a first-time borrower of a loan 
made, insured, or guaranteed under 
part B (other than a loan made pur-
suant to section 428C or a loan made 
on behalf of a student pursuant to 
section 428B) or’’ and inserting ‘‘ac-
ceptance (in a manner described in 
subparagraph (A), (B), or (C) of 
paragraph (4)) by a borrower of a 
loan’’; and 
(ii) in clause (ii)— 
(I) in the matter preceding sub-
clause (I)— 
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(aa) by striking ‘‘may’’ and 
inserting ‘‘shall’’; and 
(bb) by inserting ‘‘, for each 
award year for which the bor-
rower receives a loan made under 
part D’’ after ‘‘provided’’; 
(II) in subclause (I), by striking 
‘‘an entrance counseling session con-
duction in person’’ and inserting ‘‘a 
counseling session conducted in per-
son’’; 
(III) by striking subclause (II); 
(IV) by redesignating subclause 
(III) as subclause (II); 
(V) in subclause (II), as so redes-
ignated, by striking the period at the 
end and inserting ‘‘; or’’; and 
(VI) by adding at the end the fol-
lowing: 
‘‘(III) through the use of the on-
line counseling tool described in sub-
section (o)(1)(B).’’; and 
(C) in subparagraph (B)— 
(i) by striking ‘‘The Secretary’’ and 
inserting ‘‘In the case of institutions not 
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using the online counseling tool described 
in subsection (o)(1)(B), the Secretary’’; 
(ii) by striking ‘‘encourage institu-
tions’’ and inserting ‘‘require such institu-
tions’’; 
(iii) by inserting ‘‘, during an annual 
counseling session that is in-person or on-
line,’’ after ‘‘the use’’; and 
(iv) by striking ‘‘B or’’; 
(3) in paragraph (2)— 
(A) by redesignating subparagraphs (C) 
through (G) and subparagraphs (H) through 
(K), as subparagraphs (H) through (L), respec-
tively, and subparagraphs (N) through (Q), re-
spectively; and 
(B) by inserting after subparagraph (B), 
the following: 
‘‘(C) An explanation that the borrower is 
not required to accept the full amount of the 
loan offered to the borrower. 
‘‘(D) An explanation that the borrower 
should consider accepting any grant, scholar-
ship, or State or Federal work-study jobs for 
which the borrower is eligible prior to accepting 
Federal student loans. 
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‘‘(E) A recommendation to the borrower to 
exhaust the borrower’s Federal student loan op-
tions prior to taking out private loans and a 
warning that private loans may not offer the 
same benefits and repayment options as Fed-
eral student loans. 
‘‘(F) An explanation of the approved edu-
cational expenses for which the borrower may 
use a loan made under part D. 
‘‘(G) Information on the annual and aggre-
gate loan limits for Federal Direct Stafford 
Loans and Federal Direct Unsubsidized Staf-
ford Loans.’’; 
(C) in subparagraph (I), as so redesig-
nated— 
(i) by striking ‘‘a loan made under 
section 428B or 428H,’’; and 
(ii) by striking ‘‘, or a’’ and inserting 
‘‘or a’’; 
(D) in subparagraph (L), as so redesig-
nated— 
(i) in the matter preceding clause (i), 
by striking ‘‘Sample’’ and inserting ‘‘For a 
first-time borrower, sample’’; 
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‘‘(B) signing and returning to the institu-
tion a separate written statement that affirma-
tively states that the borrower accepts the loan; 
or 
‘‘(C) electronically signing an electronic 
version of the statement described in subpara-
graph (B).’’. 
SEC. 3. EXIT COUNSELING. 
Section 485(b) of the Higher Education Act of 1965 
(20 U.S.C. 1092(b)) is amended— 
(1) in paragraph (1)(A)— 
(A) in the matter preceding clause (i)— 
(i) by striking ‘‘through financial aid 
offices 
or 
otherwise’’ 
and 
inserting 
‘‘through the use of an interactive pro-
gram, during an exit counseling session 
that is in-person or online, or through the 
use of the online counseling tool described 
in subsection (o)(1)(A)’’; 
(ii) 
by 
redesignating 
clauses 
(i) 
through (ix) as clauses (iv) through (xii), 
respectively; 
(iii) by inserting before clause (iv), as 
so redesignated, the following: 
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‘‘(i) a summary of the outstanding 
balance of principal and interest due on 
the loans made to the borrower under part 
B, D, or E; 
‘‘(ii) an explanation of the grace pe-
riod preceding repayment and the expected 
date that the borrower will enter repay-
ment; 
‘‘(iii) an explanation that the borrower 
has the option to pay any interest that has 
accrued while the borrower was in school 
or that may accrue during the grace period 
preceding repayment or during an author-
ized period of deferment or forbearance, 
prior to the capitalization of the interest;’’; 
(iv) in clause (iv), as so redesignated, 
by striking ‘‘sample information showing 
the average’’ and inserting ‘‘information, 
based on the borrower’s outstanding bal-
ance described in clause (i), showing the 
borrower’s’’; 
(v) in clause (x), as so redesignated, 
by striking ‘‘consolidation loan under sec-
tion 428C or a’’; and 
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(vi) by adding at the end the fol-
lowing: 
‘‘(xiii) for each of the borrower’s loans 
made under part B, D, or E for which the 
borrower is receiving counseling under this 
subsection, the contact information for the 
loan servicer of the loan and a link to such 
servicer’s Website.’’; 
(2) in paragraph (1)(B)— 
(A) by inserting ‘‘online or’’ before ‘‘in 
writing’’; and 
(B) by adding before the period at the end 
the following: ‘‘, except that in the case of an 
institution using the online counseling tool de-
scribed in subsection (o)(1)(A), the Secretary 
shall attempt to provide such information to the 
student in the manner described in subsection 
(o)(3)(C)’’; and 
(3) in paragraph (2)(C), by inserting ‘‘, such as 
the online counseling tool described in subsection 
(o)(1)(A),’’ after ‘‘electronic means’’. 
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SEC. 4. ANNUAL COUNSELING FOR FEDERAL PELL GRANT 
RECIPIENTS. 
Section 485 of the Higher Education Act of 1965 (20 
U.S.C. 1092) is amended by adding at the end the fol-
lowing: 
‘‘(n) ANNUAL COUNSELING
FOR FEDERAL PELL 
GRANT RECIPIENTS.— 
‘‘(1) DISCLOSURE
REQUIRED
PRIOR
TO
DIS-
BURSEMENT OF FEDERAL PELL GRANT.— 
‘‘(A) IN GENERAL.—Each eligible institu-
tion shall, prior to the first payment of a Fed-
eral Pell Grant to a student for an award year, 
ensure that the student receives comprehensive 
information on the terms and conditions of the 
Federal Pell Grant in accordance with para-
graph (2). Such information— 
‘‘(i) shall be provided in a simple and 
understandable manner; and 
‘‘(ii) shall be provided, for each award 
year for which the student receives a Fed-
eral Pell Grant— 
‘‘(I) during a counseling session 
conducted in person; 
‘‘(II) online, with the student ac-
knowledging receipt of the informa-
tion; or 
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‘‘(III) through the use of the on-
line counseling tool described in sub-
section (o)(1)(C). 
‘‘(B) USE
OF
INTERACTIVE
PROGRAMS; 
JOINT COUNSELING PERMITTED.—In the case 
of institutions not using the online counseling 
tool described in subsection (o)(1)(C)— 
‘‘(i) the Secretary shall require such 
institutions to carry out the requirements 
of subparagraph (A) through the use, dur-
ing an annual counseling session that is in- 
person or online, of interactive programs 
that test the student’s understanding of 
the terms and conditions of the Federal 
Pell Grant paid to the student, using sim-
ple and understandable language and clear 
formatting; and 
‘‘(ii) an annual counseling session de-
scribed in subclause (I) or (II) of subpara-
graph (A)(ii) for a student may be con-
ducted in conjunction with an annual coun-
seling session described in subclause (I) or 
(II) of subsection (l)(1)(A)(ii) for such stu-
dent. 
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‘‘(2) INFORMATION TO BE PROVIDED.—The in-
formation to be provided to the student under para-
graph (1)(A) shall include the following: 
‘‘(A) An explanation of a Federal Pell 
Grant. 
‘‘(B) An explanation of approved edu-
cational expenses for which the student may use 
a Federal Pell Grant. 
‘‘(C) An explanation of why a student may 
have to repay the Federal Pell Grant. 
‘‘(D) An explanation of the maximum 
number of semesters or equivalent for which the 
student may be eligible to receive a Federal Pell 
Grant, and a statement of the amount of time 
remaining for which the student may be eligible 
to receive a Federal Pell Grant. 
‘‘(E) An explanation of how the student 
may budget for typical educational expenses 
and a sample budget based on the cost of at-
tendance for the institution. 
‘‘(F) An explanation of how the student 
may seek additional financial assistance from 
the institution’s financial aid office due to a 
change in the student’s financial circumstances, 
and the contact information for such office.’’. 
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SEC. 5. ONLINE COUNSELING TOOLS. 
Section 485 of the Higher Education Act of 1965 (20 
U.S.C. 1092) is further amended by adding at the end 
the following: 
‘‘(o) ONLINE COUNSELING TOOLS.— 
‘‘(1) IN GENERAL.—Beginning not later than 1 
year after the date of enactment of the Empowering 
Students Through Enhanced Financial Counseling 
Act, the Secretary shall maintain— 
‘‘(A) an online counseling tool that pro-
vides the exit counseling required under sub-
section (b) and meets the applicable require-
ments of this subsection; 
‘‘(B) an online counseling tool that pro-
vides the annual counseling required under sub-
section (l) and meets the applicable require-
ments of this subsection; and 
‘‘(C) an online counseling tool that pro-
vides the Federal Pell Grant counseling re-
quired under subsection (n) and meets the ap-
plicable requirements of this subsection. 
‘‘(2) REQUIREMENTS OF TOOLS.—In maintain-
ing the online counseling tools described in para-
graph (1), the Secretary shall ensure— 
‘‘(A) in the case of the online counseling 
tools described in subparagraphs (A) and (B) of 
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scribed in section 485(l)(3), the loan for which 
the student has received such counseling; and 
‘‘(C) in the case of a student described in 
subsection (b)(1)(B) at an institution that uses 
the online counseling tool described in para-
graph (1)(A) of this subsection, the Secretary 
shall attempt to provide the information de-
scribed in subsection (b)(1)(A) to the student 
through such tool.’’. 
Æ 
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