Pay Down, Upskill Act of 2021
Bill: H.R.5523 | Sponsor: Rep. Lamb, Conor (D-PA)
Policy area: Education

Summary:
Pay Down, Upskill Act of 2021
This bill establishes the Pay Down or Upskill Education Benefit Program through which the Department of Education (ED) must provide an education benefit of up to $10,000 to each eligible individual. Eligible individual refers to an individual who (1) is at least 18 years old but less than 65 years old, and (2) received a certain recovery rebate in 2021.
Specifically, the bill requires ED to provide an education benefit to an eligible individual to (1) repay all or part of the individual's qualifying student loans, or (2) pay all or part of the individual's qualified educational expenses (i.e., tuition and fees for an education or training program that results in a recognized postsecondary credential).
ED must prescribe regulations for returning an education benefit when the individual withdraws or fails to complete enrollment for the individual's education or training program.

To help Americans pay down student loan debt or pay for education or 
            training to develop or improve workforce skills.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Pay Down, Upskill Act of 2021''.

SEC. 2. PAY DOWN OR UPSKILL EDUCATION BENEFIT PROGRAM.

    (a) Program Established.--
            (1) In general.--The Secretary of Education shall carry out 
        a program, known as the ``Pay Down or Upskill Education Benefit 
        Program'', to provide to each eligible individual, upon 
        application and approval, an education benefit to--
                    (A) repay all or part of the qualifying student 
                loans of the eligible individual, in accordance with 
                subsection (b); or
                    (B) pay all or part of the qualified educational 
                expenses of the eligible individual, in accordance with 
                subsection (c).
            (2) Eligible individual.--An individual shall be an 
        ``eligible individual'' for purposes of this Act if the 
        individual--
                    (A) is not younger than 18 years of age and not 
                older than 65 years of age on the date that the 
                individual applies for an education benefit under this 
                Act; and
                    (B) received any credit or refund allowed or made 
                to the individual by reason of section 6428B of the 
                Internal Revenue Code of 1986 (as added by section 9601 
                of the American Rescue Plan Act of 2021 (Public Law 
                117-2)).
            (3) Education benefit amount.--The amount of an education 
        benefit provided to an eligible individual in accordance with 
        this Act shall be--
                    (A) the amount of the qualified student loans of 
                the individual; or
                    (B) the amount of the qualified educational 
                expenses of the individual,
        except that the maximum amount of the total education benefit 
        provided to an eligible individual shall not exceed $10,000.
            (4) Notice to the public.--Not later than 6 months after 
        the date of enactment of this Act, the Secretary shall publicly 
        announce the program established under this Act, including by 
        posting information about such program on the website of the 
        Department of Education. The Secretary shall update and 
        maintain such information as may be necessary.
            (5) Deadline for applications.--To be considered for an 
        education benefit under this section, an eligible individual 
        shall submit an application in accordance with this section 
        before the date that is 5 years after the date of the enactment 
        of this Act.
    (b) Use of Education Benefit To Pay Down Student Loan Repayment.--
            (1) Application by eligible individuals.--An eligible 
        individual who desires to apply the education benefit of the 
        individual under this section to the repayment of qualified 
        student loans shall submit, in a manner prescribed by the 
        Secretary, an application to the Secretary that--
                    (A) identifies, or permits the Secretary to 
                identify, the holder or holders of such loans;
                    (B) indicates, or permits the Secretary to 
                determine, the amounts of principal and interest 
                outstanding on the loans;
                    (C) specifies, if the outstanding balance is 
                greater than the amount of the maximum education 
                benefit under subsection (a)(3), which of the loans the 
                individual prefers to be paid by the Secretary; and
                    (D) contains or is accompanied by such other 
                information as the Secretary may require.
            (2) Disbursement of loan repayments.--Upon receipt of an 
        application that complies with paragraph (1) from an eligible 
        individual, the Secretary shall, as promptly as practicable, 
        repay the amount of the education benefit of the individual 
        determined under subsection (a)(3) by--
                    (A) disbursing such amount by check or other means 
                that is payable to the holder of the loan and requires 
                the endorsement or other certification by the eligible 
                individual; or
                    (B) in the case of a loan held by the Secretary, 
                cancelling such amount.
            (3) Application of repaid amounts.--If the amount repaid 
        under paragraph (2) is less than the principal and accrued 
        interest on any qualified student loan, such amount shall be 
        applied according to the specified priorities of the eligible 
        individual.
            (4) Reports by holders.--Any holder receiving a loan 
        payment pursuant to this subsection shall submit to the 
        Secretary such information as the Secretary may require to 
        verify that such payment was applied in accordance with this 
        subsection and any regulations prescribed to carry out this 
        subsection.
            (5) Notification of individual.--The Secretary, upon 
        repaying the education benefit of an eligible individual, shall 
        notify the individual of the amount paid for each outstanding 
        loan and the date of payment.
            (6) Authority to aggregate payments.--The Secretary may, by 
        regulation, provide for the aggregation of payments to holders 
        under this subsection.
            (7) Definition of holder.--As used in this subsection, the 
        term ``holder'' with respect to any qualified student loan 
        means the original lender or, if the loan is subsequently sold, 
        transferred, or assigned to some other person, and such other 
        person acquires a legally enforceable right to receive payments 
        from the borrower, such other person.
    (c) Use of Education Benefit for Educational Expenses To Upskill.--
            (1) Application by eligible individual.--An eligible 
        individual who desires to apply the education benefit of the 
        individual under this section to the payment of qualified 
        educational expenses shall, on a form prescribed by the 
        Secretary, submit an application to the eligible institution in 
        which the student will be enrolled that contains such 
        information as the Secretary may require to verify the 
        individual's eligibility for such benefit.
            (2) Submission of requests for payment by institutions.--An 
        eligible institution that receives one or more applications 
        that comply with paragraph (1) shall submit to the Secretary a 
        statement, in a manner prescribed by the Secretary, that--
                    (A) identifies each eligible individual filing an 
                application under paragraph (1) for a disbursement of 
                the individual's education benefit under this 
                subsection;
                    (B) specifies the amounts for which such eligible 
                individuals are, consistent with paragraph (6), 
                qualified for disbursement under this subsection;
                    (C) certifies that--
                            (i) in the case of an eligible institution 
                        that is an institution of higher education--
                                    (I) the institution has in effect a 
                                program participation agreement under 
                                section 487 of the Higher Education Act 
                                of 1965 (20 U.S.C. 1094); and
                                    (II) the institution's eligibility 
                                to participate in any of the programs 
                                under title IV of such Act (20 U.S.C. 
                                1070 et seq.) has not been limited, 
                                suspended, or terminated; and
                            (ii) in the case of an eligible institution 
                        that is not an institution of higher education, 
                        meets the requirements of subsection (d)(1)(B); 
                        and
                    (D) contains such provisions concerning financial 
                compliance as the Secretary may require.
            (3) Disbursement of payments.--Upon receipt of a statement 
        from an eligible institution that complies with paragraph (2), 
        the Secretary shall disburse the total amount of the education 
        benefit for which eligible individuals who have submitted 
        applications to that institution under paragraph (1) are 
        scheduled to receive. Such disbursement shall be made by check 
        or other means that is payable to the institution and requires 
        the endorsement or other certification by the eligible 
        individual.
            (4) Refund rules.--The Secretary shall, by regulation, 
        provide for the refund to the Secretary (and the crediting to 
        the education benefit of an eligible individual) of amounts 
        disbursed to institutions for the benefit of eligible 
        individuals who withdraw or otherwise fail to complete the 
        period of enrollment for which the assistance was provided. 
        Such regulations shall be consistent with the fair and 
        equitable refund policies required of institutions pursuant to 
        section 484B of the Higher Education Act of 1965 (20 U.S.C. 
        1091b). Amounts refunded to the Secretary pursuant to this 
        paragraph may be used by the Secretary to fund additional 
        education benefits for eligible individuals under this Act.
            (5) Maximum benefit for a period of enrollment.--The 
        portion of an eligible individual's total available education 
        benefit that may be disbursed under this subsection for any 
        period of enrollment shall not exceed the difference between--
                    (A) the tuition and fees charged to the eligible 
                individual for such period of enrollment; and
                    (B) the student's estimated financial assistance 
                for such period under part A of title IV of the Higher 
                Education Act of 1965 (20 U.S.C. 1070 et seq.).
    (d) Definitions.--In this section:
            (1) Eligible institution.--The term ``eligible 
        institution'' means--
                    (A) an institution of higher education--
                            (i) that has the meaning given such term in 
                        section 101 of the Higher Education Act of 1965 
                        (20 U.S.C. 1001); or
                            (ii) that is a provider on a list of 
                        eligible providers of training services under 
                        section 122(d) of the Workforce Innovation and 
                        Opportunity Act (29 U.S.C. 3152(d)); or
                    (B) an entity that offers a program--
                            (i) that is provided by a provider on a 
                        list of eligible providers of training services 
                        under section 122(d) of the Workforce 
                        Innovation and Opportunity Act (29 U.S.C. 
                        3152(d)); or
                            (ii) that is provided by a provider that is 
                        not on a list described in clause (i) but that, 
                        upon petition to the Secretary of Labor by an 
                        eligible individual, the Secretary determines 
                        based on indicators of performance under 
                        section 116 of the Workforce Innovation and 
                        Opportunity Act (29 U.S.C. 3141) has, for at 
                        least the five previous years, a record of good 
                        outcomes as defined by the State plan submitted 
                        under section 102 or 103 of such Act (29 U.S.C. 
                        3112; 3113) with respect to such provider.
            (2) Qualified educational expenses.--The term ``qualified 
        educational expenses'' means the cost of tuition and fees 
        charged to an eligible individual for full-time or part-time 
        enrollment at an eligible institution in an education or 
        training program that results in a recognized postsecondary 
        credential.
            (3) Qualified student loans.--The term ``qualified student 
        loans'' means--
                    (A) any loan made, insured, or guaranteed under 
                part B, part D, or part E of title IV of the Higher 
                Education Act of 1965 (20 U.S.C. 1070 et seq.) before 
                the date of enactment of this Act, including--
                            (i) loans made to a parent borrower on 
                        behalf of a dependent student under part B or 
                        part D of such Act, if such parent borrower is 
                        an eligible individual under this Act;
                            (ii) consolidation loans made under such 
                        Act; and
                            (iii) any grant treated as a loan under 
                        such part D in accordance with section 258(e), 
                        section 420M(c), or section 807(d) of such Act;
                    (B) a private education loan, as defined in section 
                140(a) of the Truth in Lending Act (15 U.S.C. 1650(a)), 
                that--
                            (i) was expressly for the cost of 
                        attendance (as defined in section 472) at an 
                        institution of higher education participating 
                        in a loan program under part B, part D, or part 
                        E of title IV of the Higher Education Act of 
                        1965 (20 U.S.C. 1070 et seq.), as of the date 
                        that the loan was disbursed; and
                            (ii) was made before the date of enactment 
                        of this Act; and
                    (C) any loan made pursuant to title VII or VIII of 
                the Public Health Service Act (42 U.S.C. 292a et seq.) 
                before the date of the enactment of this Act.
            (4) Recognized postsecondary credential.--The term 
        ``recognized postsecondary credential'' has the meaning given 
        such term in section 3 of the Workforce Innovation and 
        Opportunity Act (29 U.S.C. 3102).
            (5) Secretary.--The term ``Secretary'' means the Secretary 
        of Education.
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