A bill to temporarily extend the programs under the Higher Education Act of 1965, to amend the definition of an eligible not-for-profit holder, and for other purposes.

SECTION 1. SHORT TITLE.
    This Act may be cited as the ``Third Higher Education Extension Act 
of 2007''.
SEC. 2. EXTENSION OF PROGRAMS.
    Section 2(a) of the Higher Education Extension Act of 2005 (Public 
Law 109-81; 20 U.S.C. 1001 note) is amended by striking ``October 31, 
2007'' and inserting ``March 31, 2008''.
SEC. 3. RULE OF CONSTRUCTION.
    Nothing in this Act, or in the Higher Education Extension Act of 
2005 as amended by this Act, shall be construed to limit or otherwise 
alter the authorizations of appropriations for, or the durations of, 
programs contained in the amendments made by the Higher Education 
Reconciliation Act of 2005 (Public Law 109-171) or by the College Cost 
Reduction and Access Act (Public Law 110-84) to the provisions of the 
Higher Education Act of 1965 and the Taxpayer-Teacher Protection Act of 
2004.
SEC. 4. DEFINITION OF ELIGIBLE NOT-FOR-PROFIT HOLDER.
    Section 435(p) of the Higher Education Act of 1965 (20 U.S.C. 
1085(p)) is amended--
        (1) in paragraph (1), by striking subparagraph (D) and 
    inserting the following:
            ``(D) acting as a trustee on behalf of a State, political 
        subdivision, authority, agency, instrumentality, or other 
        entity described in subparagraph (A), (B), or (C), regardless 
        of whether such State, political subdivision, authority, 
        agency, instrumentality, or other entity is an eligible lender 
        under subsection (d).''; and
        (2) in paragraph (2)--
            (A) in subparagraph (A)(i), by striking subclause (II) and 
        inserting the following:

                    ``(II) is acting as a trustee on behalf of a State, 
                political subdivision, authority, agency, 
                instrumentality, or other entity described in 
                subparagraph (A), (B), or (C) of paragraph (1), 
                regardless of whether such State, political 
                subdivision, authority, agency, instrumentality, or 
                other entity is an eligible lender under subsection 
                (d), and such State, political subdivision, authority, 
                agency, instrumentality, or other entity, on the date 
                of enactment of the College Cost Reduction and Access 
                Act, was the sole beneficial owner of a loan eligible 
                for any special allowance payment under section 438.'';

            (B) in subparagraph (A)(ii), by inserting ``of'' after 
        ``waive the requirements'';
            (C) by amending subparagraph (B) to read as follows:
            ``(B) No for-profit ownership or control.--
                ``(i) In general.--No State, political subdivision, 
            authority, agency, instrumentality, or other entity 
            described in paragraph (1)(A), (B), or (C) shall be an 
            eligible not-for-profit holder under this Act if such 
            State, political subdivision, authority, agency, 
            instrumentality, or other entity is owned or controlled, in 
            whole or in part, by a for-profit entity.
                ``(ii) Trustees.--A trustee described in paragraph 
            (1)(D) shall not be an eligible not-for-profit holder under 
            this Act with respect to a State, political subdivision, 
            authority, agency, instrumentality, or other entity 
            described in subparagraph (A), (B), or (C) of paragraph 
            (1), regardless of whether such State, political 
            subdivision, authority, agency, instrumentality, or other 
            entity is an eligible lender under subsection (d), if such 
            State, political subdivision, authority, agency, 
            instrumentality, or other entity is owned or controlled, in 
            whole or in part, by a for-profit entity.'';
            (D) by amending subparagraph (C) to read as follows:
            ``(C) Sole ownership of loans and income.--No State, 
        political subdivision, authority, agency, instrumentality, 
        trustee, or other entity described in paragraph (1)(A), (B), 
        (C), or (D) shall be an eligible not-for-profit holder under 
        this Act with respect to any loan, or income from any loan, 
        unless--
                ``(i) such State, political subdivision, authority, 
            agency, instrumentality, or other entity is the sole 
            beneficial owner of such loan and the income from such 
            loan; or
                ``(ii) such trustee holds the loan on behalf of a 
            State, political subdivision, authority, agency, 
            instrumentality, or other entity described in subparagraph 
            (A), (B), or (C) of paragraph (1), regardless of whether 
            such State, political subdivision, authority, agency, 
            instrumentality, or other entity is an eligible lender 
            under subsection (d), and such State, political 
            subdivision, authority, agency, instrumentality, or other 
            entity is the sole beneficial owner of such loan and the 
            income from such loan.'';
            (E) in subparagraph (D), by striking ``an entity described 
        in described in paragraph (1)(A), (B), or (C)'' and inserting 
        ``a State, political subdivision, authority, agency, 
        instrumentality, or other entity described in subparagraph (A), 
        (B), or (C) of paragraph (1), regardless of whether such State, 
        political subdivision, authority, agency, instrumentality, or 
        other entity is an eligible lender under subsection (d),''; and
            (F) by amending subparagraph (E) to read as follows:
            ``(E) Rule of construction.--For purposes of subparagraphs 
        (A), (B), (C), and (D) of this paragraph, a State, political 
        subdivision, authority, agency, instrumentality, or other 
        entity described in subparagraph (A), (B), or (C) of paragraph 
        (1), regardless of whether such State, political subdivision, 
        authority, agency, instrumentality, or other entity is an 
        eligible lender under subsection (d), shall not--
                ``(i) be deemed to be owned or controlled, in whole or 
            in part, by a for-profit entity; or
                ``(ii) lose its status as the sole owner of a 
            beneficial interest in a loan and the income from a loan,
        by such State, political subdivision, authority, agency, 
        instrumentality, or other entity, or by the trustee described 
        in paragraph (1)(D), granting a security interest in, or 
        otherwise pledging as collateral, such loan, or the income from 
        such loan, to secure a debt obligation for which such State, 
        political subdivision, authority, agency, instrumentality, or 
        other entity is the issuer of the debt obligation.''.

                               Speaker of the House of Representatives.

                            Vice President of the United States and    
                                               President of the Senate.

Summary: Third Higher Education Extension Act of 2007 - Amends the Higher Education Extension Act of 2005 to extend the programs under the Higher Education Act of 1965 through March 31, 2008.

Amends the Higher Education Act of 1965 to consider trustees acting on behalf of certain governmental or tax-exempt entities as eligible nonprofit holders of Federal Family Education Loans (FFELs), regardless of whether or not such entities are eligible FFEL lenders.