I 
115TH CONGRESS 
2D SESSION 
H. R. 7112 
To improve the Higher Education Act of 1965, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
OCTOBER 30, 2018 
Mr. TAKANO (for himself, Mr. GARAMENDI, and Mr. AGUILAR) introduced the 
following bill; which was referred to the Committee on Education and the 
Workforce 
A BILL 
To improve 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; TABLE OF CONTENTS. 
(a) SHORT TITLE.—This Act may be cited as the 
‘‘Protections and Regulation for Our Students Act’’ or 
‘‘PRO Students Act’’. 
(b) TABLE OF CONTENTS.—The table of contents for 
this Act is as follows: 
Sec. 1. Short title; table of contents. 
Sec. 2. 85–15 revenue source requirement for proprietary institutions. 
Sec. 3. Definitions. 
Sec. 4. Restriction on marketing with Federal educational assistance funds. 
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Sec. 5. Whistleblower protections for persons associated with institutions of 
higher education. 
Sec. 6. Establishment of complaint resolution and tracking system. 
Sec. 7. Improved determination of cohort default rates; publication of default 
prevention plan. 
Sec. 8. Amendments to terms and conditions of borrower defenses. 
Sec. 9. Improved student loan servicing and debt collection practices. 
Sec. 10. Improved disclosures, counseling, and financial assistance information 
for students. 
Sec. 11. Program participation agreements. 
Sec. 12. Improved disclosures for clinical training programs. 
Sec. 13. Civil penalties. 
Sec. 14. Requirements for accrediting agencies or associations. 
Sec. 15. Program review and data. 
Sec. 16. Consumer protections for students. 
SEC. 2. 85–15 REVENUE SOURCE REQUIREMENT FOR PRO-
PRIETARY INSTITUTIONS. 
(a) CHANGE
FROM
90–10 TO
85–15.—Section 
487(a)(24) of the Higher Education Act of 1965 (20 
U.S.C. 1094(a)(24)) is amended by striking ‘‘ten percent’’ 
and inserting ‘‘15 percent’’. 
(b) REVISIONS TO ACCOUNTING.—Section 487(d)(1) 
of the Higher Education Act of 1965 (20 U.S.C. 
1094(d)(1)) is amended— 
(1) in subparagraph (A), by striking ‘‘account-
ing,’’ and all that follows and inserting ‘‘account-
ing;’’; 
(2) in subparagraph (B), by striking clause (iii) 
and inserting the following new clause: 
‘‘(iii) a contractual arrangement with 
a Federal agency for the purpose of pro-
viding job training to low-income individ-
uals who are in need of such training;’’; 
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(3) in subparagraph (C)— 
(A) by striking clauses (i) through (iii) and 
inserting the following new clause: 
‘‘(i) grant funds provided by a source 
that has no affiliation with the institution 
and shares no employees with the institu-
tion;’’; and 
(B) by redesignating clause (iv) as clause 
(ii); and 
(4) by striking subparagraphs (D) and (E) and 
inserting the following new subparagraphs: 
‘‘(D) include no loans made by an institu-
tion of higher education as revenue to the 
school, except for payments made by students 
on such loans; 
‘‘(E) include a scholarship provided by the 
institution— 
‘‘(i) only if the scholarship is in the 
form of monetary aid based upon the aca-
demic achievements or financial need of 
students, disbursed to qualified student re-
cipients during each fiscal year from an es-
tablished restricted account; and 
‘‘(ii) only to the extent that funds in 
that account represent designated funds, 
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or income earned on such funds, from a 
source that has no affiliation with the in-
stitution and shares no employees with the 
institution; and’’. 
SEC. 3. DEFINITIONS. 
(a) IN GENERAL.—Section 103 of the Higher Edu-
cation Act of 1965 (20 U.S.C. 1003) is amended— 
(1) by redesignating paragraphs (4) through 
(9), (10) through (14), and (15) through (24), as 
paragraphs (5) through (10), (12) through (16), and 
(18) through (26), respectively; 
(2) by inserting after paragraph (3) the fol-
lowing new paragraph: 
‘‘(4) DEFAULT MANIPULATION.—The term ‘de-
fault manipulation’ means engaging in a device or 
practice, including branching, consolidation of cam-
puses, consolidation or manipulation of the identi-
fication codes used by the Office of Postsecondary 
Education to designate campuses and institutions, 
change of ownership or control, serial forbearance, 
or any similar device or practice (as determined by 
the Secretary) when, but for the device or practice, 
one or more campuses of an institution of higher 
education would be at risk of cohort default rate 
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sanctions under section 435 or student default risk 
sanctions under section 489A.’’; 
(3) by inserting after paragraph (10), as redes-
ignated by paragraph (1) of this section, the fol-
lowing new paragraph: 
‘‘(11) FEDERAL
EDUCATIONAL
ASSISTANCE 
FUNDS.—The term ‘Federal educational assistance 
funds’ means funds provided directly to an institu-
tion or to a student attending such institution under 
any of the following provisions of law: 
‘‘(A) Title IV. 
‘‘(B) Section 477 of the Social Security 
Act. 
‘‘(C) Chapter 30, 31, 32, 33, 34, or 35 of 
title 38, United States Code. 
‘‘(D) Chapter 101, 105, 106A, 1606, 
1607, or 1608 of title 10, United States Code. 
‘‘(E) Section 1784a, 2005, or 2007 of title 
10, United States Code. 
‘‘(F) Title I of the Workforce Innovation 
and Opportunity Act (29 U.S.C. 3101 et seq.). 
‘‘(G) The Adult Education and Family Lit-
eracy Act (29 U.S.C. 3101 et seq.).’’; and 
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(4) by inserting after paragraph (16), as redes-
ignated by paragraph (1) of this section, the fol-
lowing new paragraph: 
‘‘(17) RECRUITING
AND
MARKETING
ACTIV-
ITY.— 
‘‘(A) IN GENERAL.—Except as provided in 
subparagraph (B), the term ‘recruiting and 
marketing activity’ means an activity that con-
sists of any of the following: 
‘‘(i) Any advertising or promotion ac-
tivity, including a paid announcement in 
newspapers, magazines, radio, television, 
billboards, electronic media, naming rights, 
or any other public medium of communica-
tion, including paying for a display or pro-
motion at a job fair, military installation, 
or 
postsecondary 
education 
recruiting 
event. 
‘‘(ii) Any effort to identify and attract 
prospective students, directly or through a 
contractor or other third party, including 
any contact concerning a prospective stu-
dent’s potential enrollment or application 
for grant, loan, or work assistance under 
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title IV or participation in preadmission or 
advising activities, including— 
‘‘(I) paying employees responsible 
for overseeing enrollment and for con-
tacting potential students in person, 
by phone, by email, by internet com-
munications, or by other means, re-
garding enrollment; 
‘‘(II) compensating a person to 
provide to an institution of higher 
education contact information regard-
ing prospective students, including in-
formation obtained through websites 
established for such purpose; and 
‘‘(III) providing funds to a third 
party to create or maintain a website 
for the purpose of obtaining contact 
information regarding prospective stu-
dents. 
‘‘(iii) Any other activity as the Sec-
retary may determine. 
‘‘(B) EXCEPTION.—An activity that is re-
quired as a condition of receipt of funds by an 
institution under title IV, or under another ap-
plicable Federal law, shall not be considered to 
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be a recruiting and marketing activity under 
subparagraph (A).’’. 
(b) TITLE IV PROGRAMS.—Section 481 of the Higher 
Education Act of 1965 (20 U.S.C. 1088) is amended by 
adding at the end the following new subsection: 
‘‘(g) STUDENT DEFAULT RISK.—In this title, the 
term ‘student default risk’ means the percentage that is 
calculated by taking an institution’s cohort default rate 
(as defined in section 435(m)) for the most recent fiscal 
year available, and multiplying it by the percentage of stu-
dents enrolled at such institution receiving a loan made, 
insured, or guaranteed under this title during the previous 
academic year.’’. 
SEC. 4. RESTRICTION ON MARKETING WITH FEDERAL EDU-
CATIONAL ASSISTANCE FUNDS. 
(a) REPEAL OF EXISTING PROVISION.—The Higher 
Education Opportunity Act is amended by striking section 
119 (20 U.S.C. 1011m). 
(b) INSERTION IN HIGHER EDUCATION ACT OF 1965 
AND AMENDMENTS.—Part B of title I of the Higher Edu-
cation Act of 1965 (20 U.S.C. 1011 et seq.) is amended 
by adding at the end the following new section: 
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‘‘SEC. 124. CERTIFICATION REGARDING THE USE OF CER-
TAIN FEDERAL FUNDS AND RESTRICTIONS 
ON SOURCES OF FUNDS FOR RECRUITING 
AND MARKETING ACTIVITIES. 
‘‘(a) PROHIBITION.—No Federal funds received 
under this Act by an institution of higher education or 
other postsecondary educational institution may be used 
to pay any person for influencing or attempting to influ-
ence an officer or employee of any agency, a Member of 
Congress, an officer or employee of Congress, or an em-
ployee of a Member of Congress in connection with any 
Federal action described in subsection (b). 
‘‘(b) APPLICABILITY.—The prohibition in subsection 
(a) applies with respect to the following Federal actions: 
‘‘(1) The awarding of any Federal contract. 
‘‘(2) The making of any Federal grant. 
‘‘(3) The making of any Federal loan. 
‘‘(4) The entering into of any Federal coopera-
tive agreement. 
‘‘(5) The extension, continuation, renewal, 
amendment, or modification of any Federal contract, 
grant, loan, or cooperative agreement. 
‘‘(c) LOBBYING AND EARMARKS.—No Federal stu-
dent aid funding under this Act may be used to hire a 
registered lobbyist or pay any person or entity for securing 
an earmark. 
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‘‘(d) RESTRICTIONS ON SOURCES OF FUNDS FOR RE-
CRUITING AND MARKETING ACTIVITIES.— 
‘‘(1) IN
GENERAL.—An institution of higher 
education, or other postsecondary educational insti-
tution, may not use revenues derived from Federal 
educational assistance funds for recruiting or mar-
keting activities. 
‘‘(2) RULE
OF
CONSTRUCTION.—Nothing in 
this section shall be construed as a limitation on the 
use by an institution of revenues derived from 
sources other than Federal educational assistance 
funds. 
‘‘(3) REPORTS.—Each institution of higher 
education, or other postsecondary educational insti-
tution, that derives 65 percent or more of revenues 
from Federal educational assistance funds shall re-
port annually to the Secretary and to Congress and 
shall include in such report— 
‘‘(A) a statement of the institution’s ex-
penditures on advertising, marketing, and re-
cruiting; and 
‘‘(B) a verification from an independent 
auditor that the institution is in compliance 
with the requirements of this subsection. 
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‘‘(e) CERTIFICATION.—Each institution of higher 
education or other postsecondary educational institution 
receiving Federal funding under this Act, as a condition 
for receiving such funding, shall annually certify to the 
Secretary of Education that the requirements of sub-
sections (a) through (d) have been met. 
‘‘(f) ACTIONS TO IMPLEMENT AND ENFORCE.—The 
Secretary shall take such actions as are necessary to en-
sure that the provisions of this section are implemented 
and enforced.’’. 
SEC. 5. WHISTLEBLOWER PROTECTIONS FOR PERSONS AS-
SOCIATED WITH INSTITUTIONS OF HIGHER 
EDUCATION. 
(a) WHISTLEBLOWER PROTECTION PROGRAM.—Title 
I of the Higher Education Act of 1965 is amended by in-
serting after section 123 (20 U.S.C. 1011l) the following 
new section: 
‘‘SEC. 124. PROTECTION FROM RETALIATION FOR DISCLO-
SURE OF CERTAIN INFORMATION BY PER-
SONS ASSOCIATED WITH INSTITUTIONS OF 
HIGHER EDUCATION. 
‘‘(a) PROHIBITION OF RETALIATION.— 
‘‘(1) IN
GENERAL.—An institution of higher 
education participating in programs under title IV 
(in this section referred to as an ‘institution’) may 
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not discharge, demote, or otherwise discriminate 
against any person as retaliation for— 
‘‘(A) such person disclosing to an indi-
vidual or entity described in paragraph (2) in-
formation such person reasonably believes evi-
dences a violation of any law, rule, or regulation 
by the institution; or 
‘‘(B) assisting a person disclosing such in-
formation or providing information or docu-
ments for use in disclosing such information. 
‘‘(2) INDIVIDUALS AND ENTITIES COVERED.— 
The individuals and entities described in this para-
graph are: 
‘‘(A) A Member of Congress or a rep-
resentative of a committee of Congress. 
‘‘(B) An Executive agency (as defined in 
section 105 of title 5, United States Code). 
‘‘(C) The Government Accountability Of-
fice. 
‘‘(D) A law enforcement agency. 
‘‘(E) A court or grand jury. 
‘‘(F) A management official or other em-
ployee of an institution who has the responsi-
bility to investigate, discover, or address mis-
conduct. 
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‘‘(b) INVESTIGATION OF COMPLAINTS.— 
‘‘(1) SUBMISSION
OF
COMPLAINT.—A person 
who believes that they have been subjected to a re-
taliation prohibited by subsection (a) may submit a 
complaint to the Inspector General of the Depart-
ment of Education (in this section referred to as the 
‘Inspector General’). Unless the Inspector General 
determines that the complaint is frivolous, fails to 
allege a violation of subsection (a), or has previously 
been addressed in another Federal or State judicial 
or administrative proceeding initiated by the com-
plainant, the Inspector General shall investigate the 
complaint and, upon completion of such investiga-
tion, submit a report of the findings of the investiga-
tion to the complainant, the institution concerned, 
and the Secretary. 
‘‘(2) INSPECTOR GENERAL ACTION.— 
‘‘(A) DETERMINATION OR SUBMISSION OF 
REPORT
ON
FINDINGS.—Except as provided 
under subparagraph (B), the Inspector General 
shall make a determination that a complaint is 
frivolous, fails to allege a violation of subsection 
(a), or has previously been addressed in another 
Federal or State judicial or administrative pro-
ceeding initiated by the complainant or submit 
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a report under paragraph (1) not later than 
180 days after receiving the complaint. 
‘‘(B) EXTENSION OF TIME.—If the Inspec-
tor General is unable to complete an investiga-
tion in time to submit a report within the 180- 
day period specified in subparagraph (A) and 
the complainant agrees to an extension of time, 
the Inspector General shall submit a report 
under paragraph (1) within such additional pe-
riod of time, up to 180 days, as shall be agreed 
upon between the Inspector General and the 
complainant. 
‘‘(3) PROHIBITION ON DISCLOSURE.—The In-
spector General may not respond to any inquiry or 
disclose any information from or about any person 
alleging retaliation, except to the extent that such 
response or disclosure is— 
‘‘(A) made with the consent of the person 
alleging the retaliation; 
‘‘(B) made in accordance with the provi-
sions of section 552a of title 5, United States 
Code, or as required by any other applicable 
Federal law; or 
‘‘(C) necessary to conduct an investigation 
of the alleged retaliation. 
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‘‘(4) TIME LIMITATION.—A complaint may not 
be brought under this subsection more than three 
years after the date on which the alleged retaliation 
took place. 
‘‘(c) REMEDY AND ENFORCEMENT AUTHORITY.— 
‘‘(1) IN
GENERAL.—Not later than 30 days 
after receiving an Inspector General report pursuant 
to subsection (b), the Secretary shall determine 
whether there is sufficient basis to conclude that the 
institution has violated subsection (a) and shall ei-
ther issue an order denying relief or shall take one 
or more of the following actions: 
‘‘(A) Order the institution to take action to 
abate the retaliation. 
‘‘(B) Order the institution to reinstate the 
complainant to the position that the complain-
ant held before the retaliation, together with 
compensatory damages (including back pay) 
and any other benefits, terms, or conditions 
that would apply to the complainant in that po-
sition if the retaliation had not occurred. 
‘‘(C) Order the institution to pay the com-
plainant an amount equal to the aggregate 
amount of all costs and expenses (including at-
torneys’ fees and expert witness fees) that were 
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reasonably incurred by the complainant for, or 
in connection with, bringing the complaint re-
garding the retaliation, as determined by the 
Secretary. 
‘‘(2) EXHAUSTION OF REMEDIES.—If the Sec-
retary issues an order denying relief under para-
graph (1) or has not issued an order within 210 
days after the submission of a complaint under sub-
section (b), or in the case of an extension of time 
under subsection (b)(2)(B), not later than 30 days 
after the expiration of the extension of time, and 
there is no showing that such delay is due to the bad 
faith of the complainant, the complainant shall be 
deemed to have exhausted all administrative rem-
edies with respect to the complaint, and the com-
plainant may bring a de novo action at law or equity 
against the institution to seek compensatory dam-
ages and other relief available under this section in 
the appropriate district court of the United States, 
which shall have jurisdiction over such an action 
without regard to the amount in controversy. Such 
an action shall, at the request of either party to the 
action, be tried by the court with a jury. An action 
under this paragraph may not be brought more than 
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two years after the date on which remedies are 
deemed to have been exhausted. 
‘‘(3) ADMISSIBILITY
OF
EVIDENCE.—The In-
spector General determination and order of the Sec-
retary denying relief under paragraph (2) shall be 
admissible in evidence in any de novo action at law 
or equity brought pursuant to this subsection. 
‘‘(4) ENFORCEMENT OF ORDERS.—Whenever a 
person fails to comply with an order issued under 
paragraph (1), the Secretary shall file an action for 
enforcement of such order in the United States dis-
trict court for a district in which the retaliation was 
found to have occurred. In any action brought under 
this paragraph, the court may grant appropriate re-
lief, including injunctive relief, compensatory and ex-
emplary damages, and attorneys’ fees and costs. The 
person upon whose behalf an order was issued may 
also file such an action or join in an action filed by 
the Secretary. 
‘‘(5) JUDICIAL REVIEW.—Any person adversely 
affected or aggrieved by an order issued under para-
graph (1) may obtain review of the order’s conform-
ance with this subsection, and any regulations issued 
to carry out this section, in the United States court 
of appeals for a circuit in which the retaliation is al-
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leged in the order to have occurred. No petition 
seeking such review may be filed more than 60 days 
after issuance of the order by the head of the execu-
tive agency. Such review shall conform to chapter 7 
of title 5, United States Code. Filing such an appeal 
shall not act to stay the enforcement of the order of 
the Secretary, unless a stay is specifically entered by 
the court. 
‘‘(6) BURDENS OF PROOF.—The legal burdens 
of proof specified in section 1221(e) of title 5, 
United States Code, shall be controlling for the pur-
poses of any investigation conducted by the Inspec-
tor General, decision by the Secretary, or judicial or 
administrative proceeding to determine whether dis-
crimination prohibited under this section has oc-
curred. 
‘‘(7) RIGHTS AND REMEDIES NOT WAIVABLE.— 
The rights and remedies provided for in this section 
may not be waived by any agreement, policy, form, 
or condition of employment. 
‘‘(d) NOTIFICATION OF PERSONS ASSOCIATED WITH 
INSTITUTION.—The Secretary shall ensure that each insti-
tution informs the employees, students, and contractors 
of the institution in writing of the rights and remedies 
provided under this section. 
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‘‘(e) CONSTRUCTION.—Nothing in this section may 
be construed to authorize the discharge of, demotion of, 
or discrimination against a person for a disclosure other 
than a disclosure protected by subsection (a) or to modify 
or derogate from a right or remedy otherwise available 
such person.’’. 
(b) PROHIBITION OF RETALIATION.—Section 487(a) 
of the Higher Education Act of 1965 (20 U.S.C. 1094(a)) 
is amended by adding at the end the following new para-
graph: 
‘‘(30) The institution will comply with the re-
quirements of section 124.’’. 
SEC. 6. ESTABLISHMENT OF COMPLAINT RESOLUTION AND 
TRACKING SYSTEM. 
Title I of the Higher Education Act of 1965 (20 
U.S.C. 1001 et seq.) is amended by adding at the end 
the following new part: 
‘‘PART F—COMPLAINT TRACKING SYSTEM 
‘‘SEC. 161. COMPLAINT TRACKING SYSTEM. 
‘‘(a) ESTABLISHMENT
OF COMPLAINT TRACKING 
SYSTEM.— 
‘‘(1) ESTABLISHMENT OF COMPLAINT TRACK-
ING SYSTEM.—Not later than 1 year after the enact-
ment of the PRO Students Act, the Secretary shall 
complete the establishment of a complaint tracking 
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system that includes a single, toll-free telephone 
number and a website to facilitate the centralized 
collection of, monitoring of, and response to com-
plaints or inquiries regarding the educational prac-
tices and services, and recruiting and marketing 
practices, of all postsecondary educational institu-
tions. 
‘‘(2) ESTABLISHMENT OF COMPLAINT TRACK-
ING OFFICE.—The Secretary shall establish within 
the Department an office whose functions shall in-
clude establishing, administering, and disseminating 
widely information about the complaint tracking sys-
tem established under paragraph (1). The Secretary 
shall— 
‘‘(A) to the extent necessary, combine and 
consolidate the other offices and functions of 
the Department to ensure that the office estab-
lished under this paragraph is the single point 
of contact for students and borrowers with com-
plaints; and 
‘‘(B) to the extent practicable, ensure that 
the office established in this paragraph will 
work with the Student Loan Ombudsman ap-
pointed in accordance with section 141(f) to as-
sist borrowers that have complaints regarding 
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the educational practices and services, and re-
cruiting and marketing practices, of postsec-
ondary educational institutions. 
‘‘(b) HANDLING OF COMPLAINTS.— 
‘‘(1) TIMELY RESPONSE TO COMPLAINTS.—The 
Secretary shall establish, in consultation with the 
heads of appropriate agencies, reasonable procedures 
to provide a timely response to complainants, in 
writing where appropriate, to complaints against, or 
inquiries concerning, an institution of higher edu-
cation that receives funds under this Act. Each re-
sponse shall include a description of— 
‘‘(A) the steps that have been taken by the 
Secretary in response to the complaint or in-
quiry; 
‘‘(B) any responses received by the Sec-
retary from the institution of higher education; 
and 
‘‘(C) any additional actions that the Sec-
retary has taken, or plans to take, in response 
to the complaint or inquiry. 
‘‘(2) TIMELY RESPONSE TO SECRETARY BY IN-
STITUTION OF HIGHER EDUCATION.—The Secretary 
shall notify each institution of higher education that 
receives funds under this Act and that is the subject 
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of a complaint or inquiry under this section regard-
ing the complaint or inquiry. Not later than 60 days 
after receiving such notice, such institution shall 
provide a response to the Secretary concerning the 
complaint or inquiry, including— 
‘‘(A) the steps that have been taken by the 
institution to respond to the complaint or in-
quiry; 
‘‘(B) all responses received by the institu-
tion from the complainant; and 
‘‘(C) any additional actions that the insti-
tution has taken, or plans to take, in response 
to the complaint or inquiry. 
‘‘(3) FURTHER INVESTIGATION.—The Secretary 
may, in the event that the complaint is not ade-
quately resolved or addressed by the responses of the 
institution of higher education receiving funds under 
this Act under paragraph (2), ask additional ques-
tions of such institution or seek additional informa-
tion from or action by the institution. 
‘‘(4) PROVISION OF INFORMATION.— 
‘‘(A) IN GENERAL.—An institution of high-
er education that receives funds under this Act 
shall, in a timely manner, comply with a re-
quest by the Secretary for information in the 
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control or possession of such institution con-
cerning a complaint or inquiry received by the 
Secretary under subsection (a), including sup-
porting written documentation, subject to sub-
paragraph (B). 
‘‘(B) 
EXCEPTIONS.—An 
institution 
of 
higher education that receives funds under this 
Act shall not be required to make available 
under this subsection— 
‘‘(i) any nonpublic or confidential in-
formation, including any confidential com-
mercial information; 
‘‘(ii) any information collected by the 
institution for the purpose of preventing 
fraud or detecting or making any report 
regarding other unlawful or potentially un-
lawful conduct; or 
‘‘(iii) any information required to be 
kept confidential by any other provision of 
law. 
‘‘(5) COMPLIANCE.—An institution of higher 
education that receives funds under this Act shall 
comply with the requirements to provide responses 
and information, in accordance with this subsection, 
as a condition of receiving such funds. 
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‘‘(c) TRANSPARENCY.— 
‘‘(1) SHARING
INFORMATION
WITH
FEDERAL 
AND STATE AGENCIES.—As appropriate and in ac-
cordance with section 444 of the General Education 
Provisions Act (20 U.S.C. 1232g) (commonly re-
ferred to as the ‘‘Family Educational Rights and 
Privacy Act of 1974’’) and other laws, the Secretary 
shall coordinate with the heads of relevant Federal 
and State agencies to— 
‘‘(A) collect complaints related to the com-
plaint tracking system described in subsection 
(b) from such agencies; and 
‘‘(B) when appropriate, route such com-
plaints to the Department of Education, the 
Department of Justice, the Department of De-
fense, the Department of Veterans Affairs, the 
Federal Trade Commission, the Consumer Fi-
nancial Protection Bureau, or any equivalent 
State agency. 
‘‘(2) INTERACTION WITH EXISTING COMPLAINT 
SYSTEMS.—To the extent practicable, all procedures 
established under this section, and all coordination 
carried out under paragraph (1), shall be done in ac-
cordance with the complaint tracking systems estab-
lished under Executive Order 13607 (77 Fed. Reg. 
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25861; relating to establishing principles of excel-
lence 
for 
educational 
institutions 
serving 
servicemembers, veterans, spouses, and other family 
members). 
‘‘(3) PUBLIC INFORMATION.— 
‘‘(A) IN
GENERAL.—The Secretary shall 
regularly publish on the website of the Depart-
ment information on the complaints and inquir-
ies received for each postsecondary educational 
institution under this section, including— 
‘‘(i) the number of complaints and in-
quiries received; 
‘‘(ii) the types of complaints and in-
quiries received; and 
‘‘(iii) where applicable, information 
about the resolution of the complaints and 
inquiries. 
‘‘(B) DATA PRIVACY.—In carrying out sub-
paragraph (A), the Secretary shall— 
‘‘(i) comply with applicable data pri-
vacy laws and regulations; and 
‘‘(ii) ensure that personally identifi-
able information is not shared. 
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‘‘(4) REPORTS.—Each year, the Secretary shall 
prepare and submit to the authorizing committees a 
report describing— 
‘‘(A) the types and nature of complaints 
the Secretary has received under this section; 
‘‘(B) the extent to which complainants are 
receiving relief pursuant to this section; 
‘‘(C) whether particular types of com-
plaints are more common in a given sector of 
postsecondary educational institutions; 
‘‘(D) any legislative recommendations that 
the Secretary determines are necessary to bet-
ter assist students and families; and 
‘‘(E) the schools with the highest volume 
of complaints, as determined by the Secretary. 
‘‘(d) COMPLAINANT DEFINED.—In this section, the 
term ‘complainant’ means a person with a complaint 
against, or inquiry concerning, an institution of higher 
education that receives funds under this Act who is— 
‘‘(1) a student of a postsecondary educational 
institution; 
‘‘(2) a family member of a student of a postsec-
ondary educational institution; 
‘‘(3) a third party acting on behalf of a student 
of a postsecondary educational institution; or 
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‘‘(4) a staff member or employee of a postsec-
ondary educational institution.’’. 
SEC. 7. IMPROVED DETERMINATION OF COHORT DEFAULT 
RATES; PUBLICATION OF DEFAULT PREVEN-
TION PLAN. 
Section 435 of the Higher Education Act of 1965 (20 
U.S.C. 1085) is amended— 
(1) in subsection (a)— 
(A) in paragraph (2), by adding at the end 
the following new subparagraph: 
‘‘(D) In any case where the Secretary has de-
termined that the institution has engaged in default 
manipulation, the Secretary— 
‘‘(i) shall recalculate the cohort default 
rate for the institution under this section using 
corrected data and information, for all fiscal 
years for which the default manipulation has 
occurred; and 
‘‘(ii) using the recalculated cohort default 
rate, shall redetermine under subsection (a)(2) 
whether the institution is ineligible to partici-
pate in a program under this title.’’; and 
(B) in paragraph (7)(A), by adding at the 
end the following new clause: 
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‘‘(iii) SUMMARY
OF
DEFAULT
PRE-
VENTION PLAN.—Upon receiving technical 
assistance from the Secretary under clause 
(ii), each institution subject to this sub-
paragraph shall— 
‘‘(I) prepare a summary of the 
plan described under clause (i) that is 
directed to a student audience; 
‘‘(II) make the summary publicly 
available; and 
‘‘(III) provide the summary to 
students at the institution.’’; and 
(2) in subsection (m)(3), by striking ‘‘through 
the use of’’ and all that follows through the period 
at the end and inserting ‘‘through default manipula-
tion’’. 
SEC. 8. AMENDMENTS TO TERMS AND CONDITIONS OF BOR-
ROWER DEFENSES. 
Section 455(h) of the Higher Education Act of 1965 
(20 U.S.C. 1087e(h)) is amended to read as follows: 
‘‘(h) BORROWER DEFENSES.— 
‘‘(1) IN GENERAL.—Notwithstanding any other 
provision of State or Federal law, a defense to re-
payment of a loan under this title includes— 
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‘‘(A) a substantial misrepresentation under 
section 487(c)(3); 
‘‘(B) an act or omission that would give 
rise to a cause of action against the school 
under applicable State law; or 
‘‘(C) such further acts or omissions that 
the Secretary determines appropriate. 
‘‘(2) PROCEDURES.— 
‘‘(A) IN GENERAL.—The Secretary shall, 
with respect to a borrower defense under this 
subsection— 
‘‘(i) determine the entitlement of a 
borrower to relief based on all evidence 
available to the Department; and 
‘‘(ii) provide an expeditious and fair 
process to consider applications provided 
by individuals, groups, and representatives 
on behalf of groups. 
‘‘(B) INDEPENDENT DETERMINATION.—A 
determination under subparagraph (A)(i) shall 
be independent of any action that the Depart-
ment may take to recoup from the school re-
lated to the borrower defense. 
‘‘(C) CANCELLATION
OF
DEBT.—If the 
Secretary 
determines 
under 
subparagraph 
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(A)(i) that a borrower is entitled to relief, the 
Secretary shall cancel all outstanding debt, and 
return any payments made on the loans of such 
borrower. 
‘‘(3) REGULATIONS.—The Secretary shall speci-
fy in regulations which acts or omissions of an insti-
tution of higher education a borrower may assert as 
a defense to repayment of a loan made under this 
part, except that in no event may a borrower recover 
from the Secretary, in any action arising from or re-
lating to a loan made under this part, an amount in 
excess of the amount such borrower has repaid on 
such loan.’’. 
SEC. 9. IMPROVED STUDENT LOAN SERVICING AND DEBT 
COLLECTION PRACTICES. 
Section 456 of the Higher Education Act of 1965 (20 
U.S.C. 1087f) is amended by adding at the end the fol-
lowing new subsection: 
‘‘(c) NO PREDISPUTE ARBITRATION CLAUSES.—A 
contract entered into under this section for the servicing 
of loans made or purchased under this part shall include 
a provision that any rights and remedies available to bor-
rowers against the servicer may not be waived by any 
agreement, policy, or form, including by a predispute arbi-
tration agreement.’’. 
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SEC. 10. IMPROVED DISCLOSURES, COUNSELING, AND FI-
NANCIAL ASSISTANCE INFORMATION FOR 
STUDENTS. 
Section 485(l) of the Higher Education Act of 1965 
(20 U.S.C. 1092(l)) is amended— 
(1) by striking paragraph (1) and inserting the 
following new paragraph: 
‘‘(1) DISCLOSURE REQUIRED PRIOR TO SIGNING 
MASTER PROMISSORY NOTE.—Each eligible institu-
tion shall, prior to obtaining or arranging execution 
of a master promissory note for a loan under part 
D (other than a Federal Direct Consolidation Loan) 
by a first-time borrower at such institution, ensure 
that the borrower receives comprehensive informa-
tion on the terms and conditions of the loan and of 
the responsibilities the borrower has with respect to 
such loan in accordance with paragraph (2). Such 
information— 
‘‘(A) shall be provided through the use of 
interactive programs that include mechanisms 
to check the borrower’s comprehension of the 
terms and conditions of the borrower’s loans 
under part D, using simple and understandable 
language and clear formatting; and 
‘‘(B) shall be provided— 
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‘‘(i) during an entrance counseling 
session conducted in person; or 
‘‘(ii) online.’’; and 
(2) in paragraph (2), by adding at the end the 
following new subparagraph: 
‘‘(L) Information relating to the institu-
tion’s cohort default rate, including— 
‘‘(i) the cohort default rate, as defined 
in section 435(m), of the institution; 
‘‘(ii) an easy to understand expla-
nation of the cohort default rate; 
‘‘(iii) the percentage of students at 
the institution of higher education who 
borrow Federal student loans under this 
title; 
‘‘(iv) the national average cohort de-
fault rate (as determined by the Secretary 
in accordance with section 435(m)); 
‘‘(v) in the case of an institution with 
a cohort default rate that is greater than 
the national average cohort default rate (as 
described in clause (iv)), a disclosure to the 
student that the institution’s cohort de-
fault rate is above the national average; 
and 
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‘‘(vi) in the case of an institution with 
a cohort default rate that is greater than 
30 percent, a disclosure to the students 
that if the cohort default rate remains 
greater than 30 percent for the 3 consecu-
tive years— 
‘‘(I) the institution will lose insti-
tutional eligibility for the purposes of 
programs authorized under this title; 
and 
‘‘(II) the student will no longer 
be able to receive Federal financial aid 
at that institution.’’. 
SEC. 11. PROGRAM PARTICIPATION AGREEMENTS. 
(a) SENSE OF CONGRESS REGARDING INCENTIVE 
COMPENSATION.—It is the sense of Congress that— 
(1) incentive compensation is an inappropriate 
mechanism in the delivery of higher education for in-
stitutions of higher education wishing to participate 
in programs under title IV of the Higher Education 
Act of 1965 (20 U.S.C. 1001 et seq.); and 
(2) the ban on incentive compensation under 
section 487(a)(20) of the Higher Education Act of 
1965 (20 U.S.C. 1094(a)(20)), as amended by sub-
section (b), is intended to preclude its use by institu-
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tions wishing to participate in such programs, at any 
point in the recruitment, enrollment, education, or 
employment placement of students. 
(b) AMENDMENTS.—Section 487 of the Higher Edu-
cation Act of 1965 (20 U.S.C. 1094) is amended— 
(1) in subsection (a)— 
(A) in paragraph (19), by inserting ‘‘hous-
ing facilities,’’ after ‘‘libraries,’’; 
(B) by striking paragraph (20) and insert-
ing the following: 
‘‘(20)(A) The institution or any third party act-
ing on the institution’s behalf, including an institu-
tion affiliate or service provider to the institution, 
will not provide any commission, bonus, or other in-
centive payment to any person or entity at any 
phase of the academic process based directly or indi-
rectly on success in— 
‘‘(i) securing enrollments or securing or award-
ing financial aid; 
‘‘(ii) performance in educational coursework; 
‘‘(iii) graduation; 
‘‘(iv) job placement; or 
‘‘(v) any other academic facet of a student’s en-
rollment in an institution of higher education. 
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‘‘(B) The requirements of subparagraph (A) shall not 
apply to the recruitment of foreign students residing in 
foreign countries who are not eligible to receive Federal 
student assistance.’’; and 
(C) by adding at the end the following new 
paragraphs: 
‘‘(30)(A) The institution— 
‘‘(i) shall not include a predispute arbitra-
tion agreement in any contract with a student 
or prospective student for enrollment at the in-
stitution; and 
‘‘(ii) shall agree that, in any case where a 
contract for enrollment at the institution en-
tered into by a student before the date of enact-
ment of the Protections and Regulation for Our 
Students Act included a predispute arbitration 
agreement, such agreement shall be invalid and 
unenforceable by the institution. 
‘‘(B) In this paragraph, the term ‘predispute 
arbitration agreement’ means any agreement to arbi-
trate a dispute that had not yet arisen at the time 
of the making of the agreement. 
‘‘(31)(A) If the institution has a student default 
risk for a fiscal year, as calculated by the Secretary, 
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of 0.1 or greater, the institution will, for such 
year— 
‘‘(i) provide an individual accepted for en-
rollment at the institution with a waiting pe-
riod, beginning on the date that the individual 
receives notification of the acceptance and last-
ing for not less than 2 weeks, before the indi-
vidual is required to enroll in the institution, 
pay tuition charges, or sign a master promis-
sory note for a loan under this title, in order to 
give the individual time to consider, and com-
pare among postsecondary options, program 
costs at the institution and employment pros-
pects upon completion of a program of study; 
‘‘(ii) ensure that the receipt of financial 
aid, incentives, or other benefits is not made 
contingent on an individual confirming enroll-
ment before the end of the individual’s waiting 
period; 
‘‘(iii) inform the individual, in writing and 
in a manner determined by the Secretary at the 
time of the acceptance notification, of— 
‘‘(I) the individual’s right to the 2- 
week waiting period under clause (i) begin-
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ning on the date that the individual re-
ceives notification of the acceptance; and 
‘‘(II) the reason why the institution is 
required to provide such waiting period; 
‘‘(iv) notify an individual accepted for en-
rollment at the institution of all financial aid 
determinations by not less than 1 week before 
the enrollment confirmation deadline, if all re-
quested application forms are received from the 
individual on time; and 
‘‘(v) disclose to an individual accepted for 
enrollment, in a manner determined by the Sec-
retary, that the individual may file a complaint 
through the complaint tracking system estab-
lished under section 161 if the individual be-
lieves that the institution has violated any pro-
vision of this paragraph. 
‘‘(B) If an institution described in subpara-
graph (A) fails to meet the requirements of this 
paragraph, the institution shall be subject to a civil 
penalty in accordance with section 489A. 
‘‘(C) Notwithstanding subparagraph (A), the 
Secretary may, after providing notice and an oppor-
tunity to comment, elect to replace the use of the 
student default risk percentage threshold established 
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under subparagraph (A) with a loan repayment rate 
threshold calculated in accordance with section 
483D(b).’’; and 
(2) in subsection (c)(1)(A)(i), by striking 
‘‘available’’ and inserting ‘‘made publicly available 
and provided’’. 
SEC. 12. IMPROVED DISCLOSURES FOR CLINICAL TRAIN-
ING PROGRAMS. 
Section 485 of the Higher Education Act of 1965 (20 
U.S.C. 1092) is amended by adding at the end the fol-
lowing new subsection: 
‘‘(n) REPORTS RELATING TO CLINICAL TRAINING 
PROGRAMS.— 
‘‘(1) REPORT ON CLINICAL TRAINING PROGRAM 
AGREEMENTS.— 
‘‘(A) IN GENERAL.—Beginning in the year 
in which the Protections and Regulation for 
Our Students Act is enacted, an eligible institu-
tion that participates in any program under this 
title shall prepare and submit a report to the 
Secretary containing the information described 
in subparagraph (C), for every year in which 
the eligible institution has an agreement with a 
hospital or health facility, through which— 
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‘‘(i) the eligible institution agrees to 
provide funding or other benefits to the 
hospital or health facility; and 
‘‘(ii) that hospital or health facility 
provides opportunities for students at the 
institution to participate in a clinical train-
ing program. 
‘‘(B) TIMING.—Following the year in 
which the Protections and Regulation for Our 
Students Act is enacted, the report described in 
this paragraph shall be submitted not more 
than 30 days after the end of any year for 
which a report is required to comply with sub-
paragraph (A). 
‘‘(C) CONTENTS OF REPORT.—The report 
described in this paragraph shall include the 
following: 
‘‘(i) The amount of any payments 
from the institution of higher education to 
a hospital or health facility during the pe-
riod covered by the report, and the precise 
terms of any agreement under which such 
amounts are determined. 
‘‘(ii) Any conditions associated with 
the transfer of money or the provision of 
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clinical training program opportunities 
that are part of the agreement described in 
subparagraph (A). 
‘‘(iii) Any memorandum of under-
standing between the institution of higher 
education, or an alumni association or 
foundation affiliated with or related to 
such institution, and a hospital or health 
facility, that directly or indirectly relates to 
any aspect of any agreement referred to in 
subparagraph (A) or controls or directs 
any obligations or distribution of benefits 
between or among any such entities. 
‘‘(iv) For each hospital or health facil-
ity that has an agreement described in 
subparagraph (A) with the institution, the 
number of clinical training positions at the 
hospital or health facility that are reserved 
for students at that institution. 
‘‘(2) REPORT ON CHARITABLE DONATIONS.— 
‘‘(A) IN GENERAL.—Beginning in the year 
in which the Protections and Regulation for 
Our Students Act is enacted, and annually 
thereafter, an eligible institution shall prepare 
and submit to the Secretary a report containing 
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the information described in subparagraph (C) 
if— 
‘‘(i) the eligible institution made a 
charitable donation to a hospital or health 
facility in any of the previous 3 years; and 
‘‘(ii) the number of students from the 
eligible institution who participate in any 
clinical training program at the hospital or 
health facility where such a donation was 
made increases by more than 5 students or 
10 percent, whichever is less, as compared 
to the number of such students who par-
ticipated in a clinical training program at 
that hospital or health facility during the 
first year in the previous 3-year period. 
‘‘(B) TIMING.—Following the year in 
which the Protections and Regulation for Our 
Students Act is enacted, the report described in 
subparagraph (A) shall be submitted not more 
than 30 days after the end of any year for 
which a report is required to comply with sub-
paragraph (A). 
‘‘(C) CONTENTS OF REPORT.—The report 
described in this paragraph shall include the 
following: 
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‘‘(i) The amount of each charitable 
donation that was made in the previous 3- 
year period by the eligible institution to a 
hospital or health facility. 
‘‘(ii) The number of students from the 
eligible institution who participate in any 
clinical training program at the hospital or 
health facility where each such donation 
was made— 
‘‘(I) during the year in which the 
report is submitted; and 
‘‘(II) during the first year in the 
previous 3-year period covered by the 
report. 
‘‘(3) AGGREGATION BY INSTITUTION.—The in-
formation required to be reported in this subsection 
shall include, and shall be aggregated with respect 
to, each institution of higher education and each 
alumni association or foundation affiliated with or 
related to such institution. For any year in which an 
institution is required to submit a report described 
under paragraph (1) and a report described under 
paragraph (2), the institution may submit a single 
report for that year containing all of the information 
required under paragraphs (1) and (2). 
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‘‘(4) REPORT TO CONGRESS.—The Secretary, in 
conjunction with the Secretary of Health and 
Human Services, shall submit to Congress, and 
make available to the public, an annual report that 
lists the reports submitted to the Secretary by each 
institution of higher education in accordance with 
this subsection. 
‘‘(5) PUBLIC DISCLOSURE.—Each eligible insti-
tution described in paragraph (1) or (2) of this sub-
section shall make readily available the reports de-
scribed in such paragraph (as applicable), through 
appropriate publications, mailings, and electronic 
media to the general public. 
‘‘(6) DEFINITIONS.—In this subsection: 
‘‘(A) CLINICAL TRAINING PROGRAM.—The 
term ‘clinical training program’ means any pro-
gram at, or associated or affiliated with, a hos-
pital or health facility (or any of a hospital’s af-
filiates or health facility’s affiliates), the com-
pletion of which fulfills a requirement that is 
necessary to receive a license, certificate, spe-
cialized accreditation, or other academically re-
lated pre-condition necessary under Federal or 
State law for a health profession. 
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‘‘(B) 
HEALTH
FACILITY.—The 
term 
‘health facility’ has the meaning given that 
term in section 804(d). 
‘‘(C) HOSPITAL.—The term ‘hospital’ has 
the meaning given that term in section 1861 of 
the Social Security Act (42 U.S.C. 1395x).’’. 
SEC. 13. CIVIL PENALTIES. 
Part G of title IV of the Higher Education Act of 
1965 (20 U.S.C. 1088 et seq.) is amended by inserting 
after section 489 the following new section: 
‘‘SEC. 489A. CIVIL PENALTIES AND OTHER REMEDIES. 
‘‘(a) SANCTIONS FOR SUBSTANTIAL MISREPRESEN-
TATIONS OR SERIOUS VIOLATIONS.— 
‘‘(1) CIVIL
PENALTIES.—The Secretary may 
impose a civil penalty upon an eligible institution 
upon making a determination, after reasonable no-
tice and opportunity for a hearing, that an eligible 
institution has engaged in a substantial misrepresen-
tation or other serious violation. 
‘‘(2) AMOUNT
OF
CIVIL
PENALTIES.—A civil 
penalty imposed for a violation under subparagraph 
(A) shall be not less than $100,000 or— 
‘‘(A) in the case of a first violation, an 
amount equal to the product of $1,000,000 
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multiplied by the institution’s student default 
risk, whichever is larger; 
‘‘(B) in the case of a second violation, an 
amount equal to the product of $2,000,000 
multiplied by the institution’s student default 
risk, whichever is larger; and 
‘‘(C) in the case of a third or subsequent 
violation, an amount equal to the product of 
$3,000,000 multiplied by the institution’s stu-
dent default risk, whichever is larger. 
‘‘(3) TREATMENT
OF
MULTIPLE
INSTITU-
TIONS.—For the purpose of determining the number 
of violations for subparagraph (B), any violation by 
a particular institution will accrue against all identi-
fication codes used by the Office of Postsecondary 
Education to designate campuses and institutions 
affiliated with the institution, and within the period 
of participation for the institution, as defined in sec-
tion 668.13(b) of title 34, Code of Federal Regula-
tions, or any successor regulation. 
‘‘(b) SANCTIONS FOR OTHER VIOLATIONS OF THIS 
TITLE.—Upon determination, after reasonable notice and 
opportunity for a hearing, that an eligible institution has 
engaged in a violation of any other provision of this title, 
including the failure to carry out any provision of this 
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title, that is not a significant misrepresentation or other 
serious violation, the Secretary may impose a civil penalty 
upon such institution of not more than $100,000 (subject 
to such adjustments for inflation as the Secretary may 
prescribe by regulation) for each such violation. 
‘‘(c) CIVIL PENALTIES AND SANCTIONS FOR OFFI-
CERS OF INSTITUTIONS.—Upon determination, after rea-
sonable notice and an opportunity for a hearing on the 
record, that an officer of an institution of higher education 
that participates in a program under this title has know-
ingly and willfully, or with gross negligence, violated a pro-
vision of this title, the Secretary may sanction the officer. 
Such sanctions may include the following: 
‘‘(1) Prohibiting the institution of higher edu-
cation that has employed the officer of an institution 
of higher education and that participates in a pro-
gram under this title, or any other institution of 
higher education that participates in a program 
under this title, from employing the officer, except 
that any such prohibition under this subsection shall 
not be for a period of more than 5 years from the 
date of the determination of the violation. 
‘‘(2) Assessing a civil penalty against an officer 
of an institution of higher education who has know-
ingly and willfully, or with gross negligence, violated 
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a provision of this title, except that any such civil 
penalty under this subsection shall not be greater 
than the amount of the officer’s compensation for 
each year for which the violations are determined to 
have occurred. For purposes of this subparagraph, 
an officer’s compensation shall include proceeds of 
any sales of stock and any incentive-based com-
pensation (including stock options awarded as com-
pensation) based on information required to be re-
ported to the Secretary or any other Federal agency 
during the period in which the violations are deter-
mined to have occurred. 
‘‘(d) LIMITATION, SUSPENSION, OR TERMINATION OF 
ELIGIBILITY STATUS.— 
‘‘(1) IN GENERAL.—Upon determination, after 
reasonable notice and opportunity for a hearing, that 
an eligible institution has engaged in a violation of 
any provision of this title (including the failure to 
carry out any provision of this title or any regulation 
prescribed under such provision) or a violation of 
any applicable special arrangement, agreement, or 
limitation, the Secretary may limit, suspend, or ter-
minate the participation in any program under this 
title of an eligible institution, subject to the require-
ments of paragraph (2). 
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‘‘(2) SUSPENSION PROCEDURES.—No period of 
suspension under this section shall exceed 60 days 
unless the institution and the Secretary agree to an 
extension or unless limitation or termination pro-
ceedings are initiated by the Secretary within that 
period of time. 
‘‘(e) EMERGENCY ACTION.— 
‘‘(1) IN GENERAL.—The Secretary may take an 
emergency action against an institution, under which 
the Secretary shall, effective on the date on which a 
notice and statement of the basis of the action is 
mailed to the institution (by registered mail, return 
receipt requested), withhold funds from the institu-
tion or its students and withdraw the institution’s 
authority to obligate funds under any program 
under this title, if the Secretary— 
‘‘(A) receives information, determined by 
the Secretary to be reliable, that the institution 
is violating any provision of this title, any regu-
lation prescribed under this title, or any appli-
cable special arrangement, agreement, or limita-
tion; 
‘‘(B) determines that immediate action is 
necessary to prevent misuse of Federal funds; 
and 
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‘‘(C) determines that the likelihood of loss 
outweighs the importance of the procedures pre-
scribed in subsection (e) for limitation, suspen-
sion, or termination. 
‘‘(2) TIME LIMITATION.—An emergency action 
described in paragraph (1) shall not exceed 30 days 
unless limitation, suspension, or termination pro-
ceedings are initiated by the Secretary against the 
institution within that period of time. 
‘‘(3) OPPORTUNITY TO SHOW CAUSE.—The Sec-
retary shall provide an institution that is the subject 
of an emergency action under this subsection an op-
portunity to show cause, if the institution so re-
quests, that the emergency action is unwarranted 
and should be lifted. 
‘‘(f) LIFTING OF SANCTIONS.—Notwithstanding any 
other provision of this title, an institution of higher edu-
cation that has been sanctioned by the Secretary under 
this section or any other provision of this title may not 
have such sanctions lifted until the Secretary has con-
ducted a subsequent program review under section 498A 
and has found the institution to be in compliance with this 
title. 
‘‘(g) SINGLE COURSE OF CONDUCT; COMPROMISE 
AUTHORITY AND COLLECTION OF PENALTY.— 
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‘‘(1) SAME
COURSE
OF
CONDUCT.—For pur-
poses of this section, acts and omissions relating to 
a single course of conduct shall be treated as a sin-
gle violation. 
‘‘(2) COMPROMISE AUTHORITY.—Any civil pen-
alty under this section may be compromised (but not 
eliminated) by the Secretary. In determining the 
amount of such penalty, or the amount agreed upon 
in compromise, the Secretary shall consider— 
‘‘(A) the appropriateness of the penalty to 
the size of the institution of higher education 
subject to the determination; and 
‘‘(B) the gravity of the violation, failure, or 
misrepresentation. 
‘‘(h) COLLECTION OF PENALTY.—The amount of any 
penalty under this section may be deducted from any sums 
owing by the United States to the institution charged. 
‘‘(i) DISPOSITION OF AMOUNTS RECOVERED.— 
‘‘(1) IN
GENERAL.—Amounts collected under 
this section shall be transferred to the Secretary, 
who shall determine the distribution of collected 
amounts, in accordance with paragraphs (2) and (3). 
‘‘(2) USE FOR PROGRAM INTEGRITY EFFORTS 
AND PROGRAM REVIEWS.— 
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‘‘(A) IN GENERAL.—For each fiscal year, 
an amount equal to not more than 50 percent 
of the amounts recovered or collected under this 
section— 
‘‘(i) shall be available to the Secretary 
to carry out program reviews under section 
498A and other efforts by the Secretary 
related to program integrity under part H; 
and 
‘‘(ii) may be credited, if applicable, for 
that purpose by the Secretary to any ap-
propriations and funds that are available 
to the Secretary for obligation at the time 
of collection. 
‘‘(B) 
SUPPLEMENT
NOT
SUPPLANT.— 
Amounts made available under subparagraph 
(A) shall be used to supplement and not sup-
plant any other amounts available to the Sec-
retary for the purpose described in such sub-
paragraph. 
‘‘(C) AVAILABILITY
FOR
FUNDS.—Any 
amounts collected under this section that are 
made available under paragraph (2) shall re-
main available until expended. 
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‘‘(3) USE FOR STUDENT RELIEF FUND.—For 
each fiscal year, an amount equal to not less than 
50 percent of the amounts recovered or collected 
under this section shall be deposited into the Stu-
dent Relief Fund established under subsection (k). 
‘‘(4) REPORT.—The Secretary shall regularly 
publish, on the website of the Department, a de-
tailed description that includes— 
‘‘(A) the amount of funds that were dis-
tributed for the purposes described in para-
graph (2) and the amount used for the Student 
Relief Fund under paragraph (3); and 
‘‘(B) how funds were distributed among 
the purposes described in paragraph (2)(A)(i). 
‘‘(j) STUDENT RELIEF FUND.— 
‘‘(1) ESTABLISHMENT.—The Secretary shall es-
tablish a Student Relief Fund (referred to in this 
subsection as the ‘Fund’) that shall be used, subject 
to the availability of funds, to provide financial relief 
to any student enrolled in an institution of higher 
education that— 
‘‘(A) has failed to comply with an eligi-
bility requirement under section 101 or 102 or 
an obligation incurred under the terms of the 
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program participation agreement under section 
487; or 
‘‘(B) has been sanctioned under subsection 
(b) or (c). 
‘‘(2) DETERMINATION
OF
RELIEF.—The Sec-
retary, in consultation with Director of the Bureau 
of Consumer Financial Protection— 
‘‘(A) shall determine the manner of relief 
to be provided under paragraph (1), which may 
include tuition reimbursement, full or partial 
loan forgiveness, or loan reinstatement; and 
‘‘(B) may issue regulations regarding how 
the amounts in the Fund will be distributed 
among students eligible for the funds. 
‘‘(3) 
TREATMENT
AND
AVAILABILITY
OF 
FUNDS.— 
‘‘(A) FUNDS THAT ARE NOT GOVERNMENT 
FUNDS.—Funds obtained by or transferred to 
the Fund shall not be construed to be Govern-
ment funds or appropriated monies. 
‘‘(B) AMOUNTS NOT SUBJECT TO APPOR-
TIONMENT.—Notwithstanding any other provi-
sion of law, amounts in the Fund shall not be 
subject to apportionment for purposes of chap-
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ter 15 of title 31, United States Code, or under 
any other authority. 
‘‘(C) NO FISCAL YEAR LIMITATION.—Sums 
deposited in the Fund shall remain in the Fund 
and be available for expenditure under this 
chapter without fiscal year limitation. 
‘‘(4) INVESTMENTS.— 
‘‘(A) AMOUNTS
IN
FUND
MAY
BE
IN-
VESTED.—The Secretary of Education may re-
quest the Secretary of the Treasury to invest 
the portion of the Fund that is not, in the dis-
cretion of the Secretary of Education, required 
to meet the current needs of the Fund. 
‘‘(B) 
ELIGIBLE
INVESTMENTS.—Invest-
ments shall be made by the Secretary of the 
Treasury in obligations of the United States or 
obligations that are guaranteed as to principal 
and interest by the United States, with matu-
rities suitable to the needs of the Fund as de-
termined by the Secretary on the record. 
‘‘(C) INTEREST
AND
PROCEEDS
CRED-
ITED.—The interest on, and the proceeds from 
the sale or redemption of, any obligations held 
in the Fund shall be credited to the Fund. 
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‘‘(5) REGULATIONS.—The Secretary shall pre-
scribe regulations to implement the requirements of 
this section within 1 year after the date of enact-
ment of the PRO Students Act. 
‘‘(6) AUTHORIZATION OF APPROPRIATIONS.—In 
addition to funds derived from financial penalties as-
sessed pursuant to subsection (j), there are author-
ized to be appropriated such sums as may be nec-
essary to carry out this subsection. 
‘‘(k) STATE ENFORCEMENT.— 
‘‘(1) IN GENERAL.—Any violation of subsection 
(b), including the regulations promulgated under 
such subsection, shall be a cause of action enforce-
able by the State, through the attorney general (or 
the equivalent thereof) of the State, in any district 
court of the United States in that State or in a 
State court that is located in that State and that 
has jurisdiction over the defendant. The State may 
seek any relief provided under paragraph (4)(B) for 
such violation, or any remedies otherwise provided 
under law. 
‘‘(2) NOTICE REQUIRED.— 
‘‘(A) IN GENERAL.—Before initiating any 
action in a court or other administrative or reg-
ulatory proceeding against any institution of 
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higher education as authorized by paragraph 
(1) to enforce any provision of this subsection, 
including any regulation promulgated by the 
Secretary under this subsection, a State attor-
ney general shall timely provide a copy of the 
complete complaint to be filed and written no-
tice describing such action or proceeding to the 
Secretary, except as provided in subparagraph 
(B). 
‘‘(B) EMERGENCY ACTION.—If prior notice 
of the initiation of an action or administrative 
or regulatory proceeding required under sub-
paragraph (A) is not practicable, the State at-
torney general shall provide a copy of the com-
plete complaint and the notice to the Secretary 
immediately upon instituting the action or pro-
ceeding. 
‘‘(C) CONTENTS OF NOTICE.—The notifi-
cation required under this subparagraph shall 
include— 
‘‘(i) the identity of the parties; 
‘‘(ii) the alleged facts underlying the 
proceeding; and 
‘‘(iii) whether there may be a need to 
coordinate the prosecution of the pro-
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ceeding so as not to interfere with any ac-
tion, including any rulemaking, undertaken 
by the Secretary or another Federal agen-
cy. 
‘‘(3) REGULATIONS.—The Secretary shall pre-
scribe regulations to implement the requirements of 
this subsection and periodically provide guidance to 
further coordinate actions with the State attorneys 
general. 
‘‘(4) PRESERVATION OF STATE AUTHORITY.— 
‘‘(A) STATE CLAIMS.—Nothing in this sub-
section shall be construed as altering, limiting, 
or affecting the authority of a State attorney 
general or any other regulatory or enforcement 
agency or authority to bring an action or other 
regulatory proceeding arising solely under the 
law in effect in that State. 
‘‘(B) RELIEF.— 
‘‘(i) IN GENERAL.—Relief under this 
subsection may include, without limita-
tion— 
‘‘(I) rescission or reformation of 
contracts; 
‘‘(II) refund of moneys or return 
of real property; 
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