337 
childhood education, or in a field related to early 
childhood education. 
‘‘(2) 
ELIGIBLE
PRESCHOOL
PROGRAM.—The 
term ‘eligible preschool program’ means a program 
that provides for the care, development, and education 
of infants, toddlers, or young children age 5 and 
under, meets any applicable State or local govern-
ment licensing, certification, approval, and registra-
tion requirements, and is operated by— 
‘‘(A) a public or private school that is sup-
ported, sponsored, supervised, or administered by 
a local educational agency; 
‘‘(B) a Head Start agency serving as a 
grantee designated under the Head Start Act (42 
U.S.C. 9831 et seq.); 
‘‘(C) a nonprofit or community based orga-
nization; or 
‘‘(D) a child care program, including a 
home. 
‘‘(3) ELIGIBLE EARLY CHILDHOOD EDUCATION 
PROGRAM.—The term ‘eligible early childhood edu-
cation program’ means— 
‘‘(A) a family child care program, center- 
based child care program, State prekindergarten 
program, school program, or other out-of-home 
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early childhood development care program, 
that— 
‘‘(i) is licensed or regulated by the 
State; and 
‘‘(ii) serves 2 or more unrelated chil-
dren who are not old enough to attend kin-
dergarten; 
‘‘(B) a Head Start Program carried out 
under the Head Start Act (42 U.S.C. 9831 et 
seq.); or 
‘‘(C) an Early Head Start Program carried 
out under section 645A of the Head Start Act 
(42 U.S.C. 9840a). 
‘‘(4) LOW-INCOME COMMUNITY.—The term ‘low- 
income community’ means a school attendance area 
(as defined in section 1113(a)(2)(A) of the Elemen-
tary and Secondary Education Act of 1965)— 
‘‘(A) in which 70 percent of households earn 
less than 85 percent of the State median house-
hold income; or 
‘‘(B) that includes a high-need school. 
‘‘(5) NURSE.—The term ‘nurse’ means a nurse 
who meets all of the following: 
‘‘(A) The nurse graduated from— 
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‘‘(i) an accredited school of nursing (as 
those terms are defined in section 801 of the 
Public Health Service Act (42 U.S.C. 296)); 
‘‘(ii) a nursing center; or 
‘‘(iii) an academic health center that 
provides nurse training. 
‘‘(B) The nurse holds a valid and unre-
stricted license to practice nursing in the State 
in which the nurse practices in a clinical setting. 
‘‘(C) The nurse holds one or more of the fol-
lowing: 
‘‘(i) A graduate degree in nursing, or 
an equivalent degree. 
‘‘(ii) A nursing degree from a collegiate 
school of nursing (as defined in section 801 
of the Public Health Service Act (42 U.S.C. 
296)). 
‘‘(iii) A nursing degree from an asso-
ciate degree school of nursing (as defined in 
section 801 of the Public Health Service Act 
(42 U.S.C. 296)). 
‘‘(iv) A nursing degree from a diploma 
school of nursing (as defined in section 801 
of the Public Health Service Act (42 U.S.C. 
296)). 
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‘‘(6) 
SPEECH-LANGUAGE
PATHOLOGIST.—The 
term ‘speech-language pathologist’ means a speech- 
language pathologist who— 
‘‘(A) has received, at a minimum, a grad-
uate degree in speech-language pathology or com-
munication sciences and disorders from an insti-
tution of higher education accredited by an agen-
cy or association recognized by the Secretary 
pursuant to section 496(a) of this Act; and 
‘‘(B) provides speech-language pathology 
services under section 1861(ll)(1) of the Social 
Security Act (42 U.S.C. 1395x(ll)(1)), or meets 
or exceeds the qualifications for a qualified 
speech-language pathologist under subsection 
(ll)(3) of such section (42 U.S.C. 1395x(ll)(3)). 
‘‘(i) AUTHORIZATION OF APPROPRIATIONS.—There are 
authorized to be appropriated to carry out this section such 
sums as may be necessary for fiscal year 2009 and each 
of the 4 succeeding fiscal years to provide loan forgiveness 
in accordance with this section.’’. 
SEC. 426. LOAN REPAYMENT FOR CIVIL LEGAL ASSISTANCE 
ATTORNEYS. 
Part B of title IV (20 U.S.C. 1071 et seq.) is amended 
by inserting after section 428K the following new section: 
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341 
‘‘SEC. 428L. LOAN REPAYMENT FOR CIVIL LEGAL ASSIST-
ANCE ATTORNEYS. 
‘‘(a) PURPOSE.—The purpose of this section is to en-
courage qualified individuals to enter and continue employ-
ment as civil legal assistance attorneys. 
‘‘(b) DEFINITIONS.—In this section: 
‘‘(1) CIVIL LEGAL ASSISTANCE ATTORNEY.—The 
term ‘civil legal assistance attorney’ means an attor-
ney who— 
‘‘(A) is a full-time employee of a nonprofit 
organization that provides legal assistance with 
respect to civil matters to low-income individuals 
without a fee; 
‘‘(B) as such employee, provides civil legal 
assistance as described in subparagraph (A) on 
a full-time basis; and 
‘‘(C) is continually licensed to practice law. 
‘‘(2) STUDENT LOAN.—The term ‘student loan’ 
means— 
‘‘(A) subject to subparagraph (B), a loan 
made, insured, or guaranteed under part B, D, 
or E of this title; and 
‘‘(B) a loan made under section 428C or 
455(g), to the extent that such loan was used to 
repay— 
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‘‘(i) a Federal Direct Stafford Loan, a 
Federal Direct Unsubsidized Stafford Loan, 
or a Federal Direct PLUS Loan; 
‘‘(ii) a loan made under section 428, 
428B, or 428H; or 
‘‘(iii) a loan made under part E. 
‘‘(c) PROGRAM AUTHORIZED.—The Secretary shall 
carry out a program of assuming the obligation to repay 
a student loan, by direct payments on behalf of a borrower 
to the holder or the Secretary in the case of a loan under 
part D or E of such loan, in accordance with subsection 
(d), for any borrower who— 
‘‘(1) is employed as a civil legal assistance attor-
ney; and 
‘‘(2) is not in default on a loan for which the 
borrower seeks repayment. 
‘‘(d) TERMS OF AGREEMENT.— 
‘‘(1) IN GENERAL.—To be eligible to receive re-
payment benefits under subsection (c), a borrower 
shall enter into a written agreement with the Sec-
retary that specifies that— 
‘‘(A) the borrower will remain employed as 
a civil legal assistance attorney for a required 
period of service of not less than 3 years, unless 
involuntarily separated from that employment; 
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‘‘(B) if the borrower is involuntarily sepa-
rated from employment on account of mis-
conduct, or voluntarily separates from employ-
ment, before the end of the period specified in the 
agreement, the borrower will repay the Secretary 
the amount of any benefits received by such em-
ployee under this agreement; 
‘‘(C) if the borrower is required to repay an 
amount to the Secretary under subparagraph 
(B) and fails to repay such amount, a sum equal 
to that amount shall be recoverable by the Fed-
eral Government from the employee by such 
methods as are provided by law for the recovery 
of amounts owed to the Federal Government; 
‘‘(D) the Secretary may waive, in whole or 
in part, a right of recovery under this subsection 
if it is shown that recovery would be against eq-
uity and good conscience or against the public 
interest; and 
‘‘(E) the Secretary shall make student loan 
payments under this section for the period of the 
agreement, subject to the availability of appro-
priations. 
‘‘(2) REPAYMENTS.— 
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344 
‘‘(A) IN GENERAL.—Any amount repaid by, 
or recovered from, an individual under this sub-
section shall be credited to the appropriation ac-
count from which the amount involved was origi-
nally paid. 
‘‘(B) 
MERGER.—Any 
amount 
credited 
under subparagraph (A) shall be merged with 
other sums in such account and shall be avail-
able for the same purposes and period, and sub-
ject to the same limitations, if any, as the sums 
with which the amount was merged. 
‘‘(3) LIMITATIONS.— 
‘‘(A) STUDENT LOAN PAYMENT AMOUNT.— 
Student loan repayments made by the Secretary 
under this section shall be made subject to such 
terms, limitations, or conditions as may be mu-
tually agreed upon by the borrower and the Sec-
retary in an agreement under paragraph (1), ex-
cept that the amount paid by the Secretary 
under this section shall not exceed— 
‘‘(i) $6,000 for any borrower in any 
calendar year; or 
‘‘(ii) an aggregate total of $40,000 in 
the case of any borrower. 
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345 
‘‘(B) BEGINNING
OF
PAYMENTS.—Nothing 
in this section shall authorize the Secretary to 
pay any amount to reimburse a borrower for 
any repayments made by such borrower prior to 
the date on which the Secretary entered into an 
agreement with the borrower under this sub-
section. 
‘‘(e) ADDITIONAL AGREEMENTS.— 
‘‘(1) IN
GENERAL.—On completion of the re-
quired period of service under an agreement under 
subsection (d), the borrower and the Secretary may, 
subject to paragraph (2), enter into an additional 
agreement in accordance with subsection (d). 
‘‘(2) TERM.—An agreement entered into under 
paragraph (1) may specify that, notwithstanding sub-
section (d)(1)(A), the required period of service dur-
ing which the borrower will remain employed as a 
civil legal assistance attorney may be less than 3 
years. 
‘‘(f) AWARD BASIS; PRIORITY.— 
‘‘(1) AWARD BASIS.—Subject to paragraph (2), 
the Secretary shall provide repayment benefits under 
this section on a first-come, first-served basis, and 
subject to the availability of appropriations. 
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346 
‘‘(2) PRIORITY.—The Secretary shall give pri-
ority in providing repayment benefits under this sec-
tion in any fiscal year to a borrower who— 
‘‘(A) has practiced law for 5 years or less 
and, for at least 90 percent of the time in such 
practice, has served as a civil legal assistance at-
torney; 
‘‘(B) received repayment benefits under this 
section during the preceding fiscal year; and 
‘‘(C) has completed less than 3 years of the 
first required period of service specified for the 
borrower in an agreement entered into under 
subsection (d). 
‘‘(g) REGULATIONS.—The Secretary is authorized to 
issue such regulations as may be necessary to carry out the 
provisions of this section. 
‘‘(h) AUTHORIZATION
OF APPROPRIATIONS.—There 
are authorized to be appropriated to carry out this section 
$10,000,000 for fiscal year 2009 and such sums as may be 
necessary for each of the 4 succeeding fiscal years.’’. 
SEC. 427. SETTLEMENT OF CLAIMS. 
Section 432(b) (20 U.S.C. 1082(b)) is amended by add-
ing at the end the following: ‘‘The Secretary may not enter 
into any settlement of any claim under this Act that exceeds 
$1,000,000 unless the Secretary has asked the Attorney Gen-
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eral to review the settlement agreement and issue an opin-
ion to the Secretary and the authorizing committees related 
to such proposed settlement.’’. 
SEC. 428. DELINQUENCY PREVENTION, DEFAULT AVERSION, 
AND CONSUMER EDUCATION INFORMATION 
PROGRAMS. 
Part B of title IV is further amended by inserting after 
section 433 (20 U.S.C. 1083) the following new section: 
‘‘SEC. 433A. DELINQUENCY PREVENTION, DEFAULT AVER-
SION, AND CONSUMER EDUCATION INFORMA-
TION PROGRAMS. 
‘‘(a) GUARANTY AGENCY DUTY.—Each guaranty agen-
cy, with respect to loans insured by the agency, shall de-
velop specific programs designed to prevent delinquencies 
and avert defaults. 
‘‘(b) TRAINING FOR STUDENTS AND FAMILIES.—Each 
guaranty agency, after consulting with institutions of high-
er education (including institutions of higher education 
participating in the William Ford Direct Loan Program), 
shall develop and make available high quality educational 
programs and materials to provide training for students 
and families in budgeting and financial management, in-
cluding debt management and other aspects of financial lit-
eracy, such as the cost of using high interest loans to pay 
for postsecondary education. Such programs and materials 
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348 
shall address budgeting and financial management relating 
to student loans, and shall be made available to students 
and families, in a form and language that is understand-
able, before, during, and after the students’ enrollment. 
‘‘(c) RULE OF CONSTRUCTION.—Nothing in this sec-
tion shall be construed to prohibit a guaranty agency from 
using existing activities, programs, and materials in meet-
ing the requirements of this section.’’. 
SEC. 429. DEFINITION OF ELIGIBLE LENDER. 
Section 435(d)(1)(A)(ii) (20 U.S.C. 1085(d)(1)(A)(ii)) 
is amended— 
(1) by striking ‘‘part, or (III)’’ and inserting 
‘‘part, (III)’’; and 
(2) by inserting before the semicolon at the end 
the following: ‘‘, or (IV) it is a National or State 
chartered 
bank 
with 
assets 
of 
less 
than 
$1,000,000,000’’. 
SEC. 430. COHORT DEFAULT RATES. 
Section 435(m) (20 U.S.C. 1085(m)) is amended— 
(1) in the first sentence of paragraph (1)(A), by 
striking ‘‘end of the following fiscal year’’ and insert-
ing ‘‘beginning of the third fiscal year following the 
fiscal year in which the students entered repayment’’; 
(2) in paragraph (1)(C), by striking ‘‘end of the 
fiscal year immediately following the year in which 
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349 
they entered repayment’’ and inserting ‘‘beginning of 
the third fiscal year following the year in which they 
entered repayment’’; 
(3) in paragraph (2)(C), by striking ‘‘end of 
such following fiscal year is not considered as in de-
fault for the purposes of this subsection’’ and insert-
ing ‘‘beginning of the third fiscal year following the 
year in which the loan entered repayment is not con-
sidered as in default for purposes of this subsection’’; 
and 
(4) in paragraph (4)— 
(A) by amending the header to read as fol-
lows: ‘‘COLLECTION AND REPORTING OF COHORT 
DEFAULT RATES AND LIFE OF COHORT DEFAULT 
RATES.—’’; and 
(B) by amending subparagraph (A) to read 
as follows: 
‘‘(A) The Secretary shall collect data from all in-
surers under this part and shall publish not less often 
than once every fiscal year a report showing cohort 
default data and life of cohort default data for each 
category of institution, including (i) 4-year public in-
stitutions, (ii) 4-year private nonprofit institutions, 
(iii) 2-year public institutions, (iv) 2-year private in-
stitutions, (v) 4-year proprietary institutions, (vi) 2- 
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350 
year proprietary institutions, and (vii) less than 2- 
year proprietary institutions. For purposes of this 
subparagraph, the life of cohort default rate means, 
for any fiscal year in which 1 or more current and 
former students at an institution enter repayment on 
loans under section 428, 428A, or 428H, received for 
attendance at the institution, the percentage of those 
current and former students who enter repayment on 
such loans (or on the portion of a loan made under 
section 428C that is used to repay any such loans) re-
ceived for attendance at the institution in that fiscal 
year who default before the end of each succeeding fis-
cal year.’’. 
SEC. 431. DISABILITY DETERMINATIONS. 
Section 437(a) (20 U.S.C. 1087(a)) is amended by 
adding at the end the following new sentence: ‘‘A borrower 
who receives a permanent total disability rating from the 
Secretary of Veterans Affairs, and who provides documenta-
tion of such rating to the Secretary of Education, shall be 
considered permanently and totally disabled for the purpose 
of discharging such borrower’s loans under this subsection, 
and such borrower shall not be required to present addi-
tional documentation for purposes of this subsection.’’. 
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351 
PART C—COLLEGE WORK/STUDY 
SEC. 441. REAUTHORIZATION. 
(a) EXTENSION
OF AUTHORITY.—Section 441 (42 
U.S.C. 2751) is amended— 
(1) in subsection (b), by striking ‘‘$1,000,000,000 
for fiscal year 1999’’ and inserting ‘‘$1,500,000,000 
for fiscal year 2009’’; and 
(2) in subsection (c)— 
(A) by striking ‘‘and’’ at the end of para-
graph (3); 
(B) by striking the period at the end of 
paragraph (4) and inserting ‘‘; and’’; and 
(C) by adding at the end the following new 
paragraph: 
‘‘(5) responding to the needs of the community, 
which may include activities in preparation for and 
during emergencies and natural disasters.’’. 
(b) ALLOWANCE FOR BOOKS AND SUPPLIES.—Section 
442(c)(4)(D) (42 U.S.C. 2752(d)(4)(D)) is amended by 
striking ‘‘$450’’ and inserting ‘‘$600’’. 
SEC. 442. ADDITIONAL FUNDS FOR OFF-CAMPUS COMMU-
NITY SERVICE. 
Section 447 (42 U.S.C. 2756a) is amended— 
(1) by striking ‘‘Each institution participating’’ 
and inserting ‘‘(a) COMMUNITY
SERVICE-LEARN-
ING.—Each institution participating’’; and 
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(2) by adding at the end the following new sub-
section: 
‘‘(b) OFF-CAMPUS COMMUNITY SERVICE.— 
‘‘(1) GRANTS
AUTHORIZED.—In addition to 
funds made available under section 443(b)(2)(B), the 
Secretary is authorized to award grants to institu-
tions participating under this part to supplement off- 
campus community service employment. 
‘‘(2) USE OF FUNDS.—In any year in which sec-
tion 443(b)(2)(B) applies, an institution shall ensure 
that funds granted to such institution under this sub-
section are used in accordance with such section 443 
to recruit and compensate students (including com-
pensation for time spent in training and for travel 
directly related to such community service). 
‘‘(3) PRIORITY.—In awarding grants under this 
subsection, the Secretary shall give priority to appli-
cations that support postsecondary students assisting 
with early childhood education activities and activi-
ties in preparation for and during emergencies and 
natural disasters. 
‘‘(4) AUTHORIZATION
OF
APPROPRIATIONS.— 
There are authorized to be appropriated to carry out 
this subsection such sums as may be necessary for fis-
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353 
cal year 2009 and each of the 4 succeeding fiscal 
years.’’. 
SEC. 443. WORK COLLEGES. 
(a) 
WORK-LEARNING-SERVICE.—Section 
448 
(42 
U.S.C. 2756b) is amended by striking ‘‘work-learning’’ each 
place it appears and inserting ‘‘work-learning-service’’. 
(b) DEFINITION.—Section 448(e) is amended to read 
as follows: 
‘‘(e) DEFINITIONS.—For the purpose of this section— 
‘‘(1) the term ‘work college’ means an eligible in-
stitution that— 
‘‘(A) has been a public or private nonprofit, 
four-year, degree granting institution with a 
commitment to community service; 
‘‘(B) has operated a comprehensive work- 
learning-service program for at least 2 years; 
‘‘(C) requires all resident students, includ-
ing at least one-half of all students who are en-
rolled on a full-time basis, to participate in a 
comprehensive work-learning-service program for 
at least 5 hours each week, or at least 80 hours 
during each period of enrollment, except summer 
school, unless the student is engaged in an insti-
tutionally organized or approved study abroad 
or externship program; and 
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355 
(c) AUTHORIZATION.—Section 448(f) is amended— 
(1) by striking ‘‘$5,000,000’’ and inserting ‘‘such 
sums as may be necessary’’; and 
(2) by striking ‘‘1999’’ and inserting ‘‘2009’’. 
PART D—FEDERAL DIRECT STUDENT LOANS 
SEC. 451. REAUTHORIZATION. 
Section 458(a) (20 U.S.C. 1087h(a)) is amended— 
(1) in paragraph (2)— 
(A) in the heading of such paragraph, by 
striking ‘‘2011’’ and inserting ‘‘2013’’; and 
(B) by striking ‘‘2011’’ and inserting 
‘‘2013’’; and 
(2) in paragraph (3), by striking ‘‘2011’’ and in-
serting ‘‘2013’’. 
SEC. 452. PUBLIC SERVICE JOB DEFINITION. 
Section 455(m)(3)(B) (20 U.S.C. 1087e(m)(3)(B)) is 
amended to read as follows: 
‘‘(B) PUBLIC SERVICE JOB.—The term ‘pub-
lic service job’ means— 
‘‘(i) a full-time job in emergency man-
agement, government (excluding time served 
as a member of Congress), military service, 
public safety, law enforcement, public health 
(including 
nurses, 
nurse 
practitioners, 
nurses in a clinical setting, and full-time 
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professionals engaged in health care practi-
tioner occupations and health care support 
occupations, as such terms are defined by 
the Bureau of Labor Statistics), public edu-
cation, social work in a public child or fam-
ily service agency, public interest law serv-
ices (including prosecution or public defense 
or legal advocacy on behalf of low-income 
communities at a nonprofit organization), 
early childhood education (including li-
censed or regulated childcare, Head Start, 
and State funded prekindergarten), public 
service for individuals with disabilities, 
public service for the elderly, public library 
sciences, school-based library sciences and 
other school-based services, or at an organi-
zation that is described in section 501(c)(3) 
of the Internal Revenue Code of 1986 and 
exempt from taxation under section 501(a) 
of such Code; or 
‘‘(ii) teaching as a full-time faculty 
member at a Tribal College or University as 
defined in section 316(b) and other faculty 
teaching in high-needs subject areas or 
areas of shortage (including nurse faculty, 
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357 
foreign language faculty and part-time fac-
ulty at community colleges), as determined 
by the Secretary.’’. 
SEC. 453. IDENTITY FRAUD PROTECTION. 
Section 455 (20 U.S.C. 1087e) is further amended by 
adding at the end the following new subsection: 
‘‘(n) IDENTITY FRAUD PROTECTION.—The Secretary 
of Education shall take such steps as may be necessary to 
ensure that monthly Direct Loan statements and other pub-
lications of the Department of Education do not contain 
more than 4 digits of the Social Security number of any 
individual.’’. 
SEC. 454. DIRECT LOAN PROGRAM AUDIT AND REPORTING 
REQUIREMENTS. 
(a) AUDIT OF DIRECT LOAN SERVICING PORTFOLIO 
AND DIRECT LOAN SERVICING CONTRACTS.—Section 458 
(20 U.S.C. 1087h) is amended by adding at the end the 
following: 
‘‘(d) AUDIT OF DIRECT LOAN SERVICING PORTFOLIO 
AND DIRECT LOAN SERVICING CONTRACTS.—The Secretary 
shall have a financial and compliance audit of all loans 
owned by the Department of Education and made under 
the William D. Ford Federal Direct Loan Program and all 
contracts for the origination, servicing, collection, and re-
lated activities of such loans, conducted annually by a 
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358 
qualified independent organization from a list of qualified 
organizations promulgated by the Secretary in accordance 
with standards established by the Comptroller General. The 
standards shall measure the servicer’s compliance with the 
due diligence standards and shall include a defined statis-
tical sampling technique designed to measure the perform-
ance rating of the servicer for the purpose of this section. 
The Secretary shall submit the audit to Congress within 
60 days of its completion and shall at the same time make 
the results of the audit publicly available.’’. 
(b) QUARTERLY REPORTING OF ADMINISTRATIVE EX-
PENSES.—Section 458 (20 U.S.C. 1087h) is further amend-
ed by adding at the end the following: 
‘‘(e) BUDGET JUSTIFICATION AND QUARTERLY RE-
PORTS.—In addition to the requirements of subsection (c), 
and as a prerequisite to expending funds under this section, 
the Secretary shall— 
‘‘(1) make publicly available immediately upon 
providing to Congress, its annual budget justification 
referenced in the last sentence of subsection (c), in-
cluding the detailed descriptions of activities and the 
costs for each such activity; and 
‘‘(2) make publicly available within 30 days of 
the close of each calendar quarter, an interim report 
with at least the same level of detail as the annual 
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359 
report referred to above, showing the detailed descrip-
tions of activities and the costs for each such activity, 
for the quarter, which shall include— 
‘‘(A) amendments to any contracts entered 
into by the Department for the purposes of serv-
icing, origination, consolidating, or otherwise 
providing administrative support for the Direct 
Loan program; 
‘‘(B) a complete listing of all milestones for 
upgrades and improvements in any of the con-
tracts referenced in section 458(d)(1) and the 
progress towards meeting such milestones; 
‘‘(C) un-reconciled balances in held loans by 
year of origination; 
‘‘(D) status and number of defaulted loans 
by length of default in 30-day increments; 
‘‘(E) status and number of delinquent loans 
by length of delinquency in 30-day increments; 
‘‘(F) 
information 
technology 
purchases 
made under this section; and 
‘‘(G) costs and terms of all contracts with 
external consultants and employees of institu-
tions of higher education.’’. 
(c) ANNUAL REPORTING OF IMPACT OF DIRECT LOAN 
PROGRAM TREASURY BORROWING ON NATIONAL DEBT.— 
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360 
Section 458 (20 U.S.C. 1087(h)) is further amended by add-
ing at the end the following subsection: 
‘‘(f) NATIONAL DEBT REPORT CARD.—The Secretary 
shall make an annual report to Congress, included with the 
budget justification for the Department, of the aggregate 
dollar amount of increase in the national debt as a result 
of loans made under part D of this title. This reporting 
shall be made by calculating the net of the total outstanding 
amount lent by the Department and the United States 
Treasury, less the balance in principal of performing and 
non-defaulted loans outstanding in the Department’s port-
folio.’’. 
PART E—PERKINS LOANS 
SEC. 461. EXTENSION OF AUTHORITY. 
Section 461(b) (20 U.S.C. 1087aa(b)) is amended— 
(1) in paragraph (1), by striking ‘‘$250,000,000 
for fiscal year 1999’’ and inserting ‘‘$350,000,000 for 
fiscal year 2009’’; and 
(2) in paragraph (2), by striking ‘‘2003’’ each 
place it appears and inserting ‘‘2014’’. 
SEC. 462. ALLOWANCE FOR BOOKS AND SUPPLIES. 
Section 462(c)(4)(D) (20 U.S.C. 1087bb(c)(4)(D)) is 
amended by striking ‘‘$450’’ and inserting ‘‘$600’’. 
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361 
SEC. 463. AGREEMENTS WITH INSTITUTIONS. 
(a) 
TRANSFERS
FOR
COLLECTION.—Section 
463(a)(4)(B) (20 U.S.C. 1087cc(a)(4)(B)) is amended to 
read as follows: 
‘‘(B) if the institution is not one described 
in subparagraph (A), the Secretary may allow 
such institution to refer such note or agreement 
to the Secretary, without recompense, except that 
any sums collected on such a loan (less an 
amount not to exceed 30 percent of any such 
sums collected to cover the Secretary’s collection 
costs) shall be repaid to such institution no later 
than 180 days after collection by the Secretary 
and treated as an additional capital contribu-
tion under section 462;’’. 
(b) REVISE AUTHORITY TO PRESCRIBE ADDITIONAL 
FISCAL
CONTROLS.—Section 
463(a)(9) 
(20 
U.S.C. 
1087cc(a)(9)) is amended by inserting ‘‘, except that noth-
ing in this paragraph shall be construed to permit the Sec-
retary to require the assignment of loans to the Secretary 
other than as is provided for in paragraphs (4) and (5)’’ 
before the period. 
SEC. 464. PERKINS LOAN TERMS AND CONDITIONS. 
(a) LOAN
LIMITS.—Section 464(a) (20 U.S.C. 
1087dd(a)) is amended— 
(1) in paragraph (2)(A)— 
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(A) by striking ‘‘$4,000’’ in clause (i) and 
inserting ‘‘$5,500’’; and 
(B) by striking ‘‘$6,000’’ in clause (ii) and 
inserting ‘‘$8,000’’; and 
(2) in paragraph (2)(B)— 
(A) by striking ‘‘$40,000’’ in clause (i) and 
inserting ‘‘$60,000’’; 
(B) by striking ‘‘$20,000’’ in clause (ii) and 
inserting ‘‘$27,500’’; and 
(C) by striking ‘‘$8,000’’ in clause (iii) and 
inserting ‘‘$11,000’’. 
(b) FORBEARANCE.—Section 464 (20 U.S.C. 1087dd) 
is further amended— 
(1) in subsection (e)— 
(A) in the matter preceding paragraph (1), 
by striking ‘‘, upon written request,’’ and insert-
ing ‘‘, as documented in accordance with para-
graph (2),’’; 
(B) 
by 
redesignating 
paragraphs 
(1) 
through (3) as subparagraphs (A) through (C), 
respectively; 
(C) by inserting ‘‘(1)’’ after ‘‘FORBEAR-
ANCE.—’’; and 
(D) by adding at the end the following: 
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363 
‘‘(2) For the purpose of paragraph (1), the terms of 
forbearance agreed to by the parties shall be documented 
by— 
‘‘(A) confirming the agreement of the borrower 
by notice to the borrower from the institution of high-
er education; and 
‘‘(B) recording the terms in the borrower’s file.’’; 
(2) in subsection (h)(1)(A), by striking ‘‘12 
ontime’’ and inserting ‘‘9 on-time’’; and 
(3) in subsection (j)(2), by striking ‘‘(e)(3)’’ and 
inserting ‘‘(e)(1)(C)’’. 
SEC. 465. CANCELLATION FOR PUBLIC SERVICE. 
Section 465(a) (20 U.S.C. 1087ee(a)) is amended— 
(1) in paragraph (2)— 
(A) by amending subparagraph (A) to read 
as follows: 
‘‘(A) as a full-time teacher for service in an aca-
demic year in a high-need school;’’; 
(B) in subparagraph (B), by striking 
‘‘Head Start Act which’’ and inserting ‘‘Head 
Start Act, or in a prekindergarten or child care 
program that is licensed or regulated by the 
State, that’’; 
(C) in subparagraph (H), by striking ‘‘or’’ 
after the semicolon; 
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364 
(D) in subparagraph (I), by striking the pe-
riod and inserting a semicolon; and 
(E) by inserting before the matter following 
subparagraph (I) the following: 
‘‘(J) as a full-time fire fighter for service to a 
local, State, or Federal fire department or fire dis-
trict; 
‘‘(K) as a full-time faculty member at a Tribal 
College or University, as that term is defined in sec-
tion 316; 
‘‘(L) as a librarian, if the librarian has a mas-
ter’s degree in library science and is employed in— 
‘‘(i) an elementary school or secondary 
school that is eligible for assistance under title I 
of the Elementary and Secondary Education Act 
of 1965; or 
‘‘(ii) a public library that serves a geo-
graphic area that contains 1 or more schools eli-
gible for assistance under title I of the Elemen-
tary and Secondary Education Act of 1965; or 
‘‘(M) as a full-time speech language therapist, if 
the therapist has a master’s degree and is working ex-
clusively with schools that are eligible for assistance 
under title I of the Elementary and Secondary Edu-
cation Act of 1965.’’; and 
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(2) in paragraph (3)(A)— 
(A) in clause (i)— 
(i) by inserting ‘‘(D),’’ after ‘‘(C),’’; 
and 
(ii) by striking ‘‘or (I)’’ and inserting 
‘‘(I), (J), (K), (L), or (M)’’; 
(B) in clause (ii), by inserting ‘‘or’’ after 
the semicolon; 
(C) by striking clause (iii); and 
(D) by redesignating clause (iv) as clause 
(iii). 
PART F—NEED ANALYSIS 
SEC. 471. COST OF ATTENDANCE. 
(a) 
AMENDMENTS.—Section 
472(3) 
(20 
U.S.C. 
1087kk(3)) is amended— 
(1) in subparagraph (B), by striking ‘‘and’’ after 
the semicolon; 
(2) by redesignating subparagraph (C) as sub-
paragraph (D); and 
(3) by inserting after subparagraph (B), as 
amended by paragraph (1), the following: 
‘‘(C) for students who live in housing lo-
cated on a military base or for which a basic al-
lowance is provided under section 403(b) of title 
37, United States Code, shall be an allowance 
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