COVID–19 Student Loan Relief Extension Act
Bill: H.R.394 | Sponsor: Rep. Courtney, Joe (D-CT)
Policy area: Education

Summary:
COVID-19 Student Loan Relief Extension Act
This bill extends certain temporary relief related to federal student loans and expands eligibility for such relief to additional types of loans.
Specifically, the bill extends the current suspension of payments due on federal student loans to 30 days after the end of the COVID-19 (i.e., coronavirus disease 2019) public health emergency. It also extends the suspension of interest due on these loans until the economy shows specified initial signs of recovery.
Further, the bill expands eligibility for temporary relief on federal student loans to include Federal Family Education Loans (FFELs) and Federal Perkins Loans that are not held by the Department of Education (ED) and certain health profession and nursing loans. (Currently, these temporary relief provisions are only applicable to certain Federal Direct Loans and FFELs that are held by ED.) Additionally, the bill makes this eligibility retroactive to March 13, 2020.
Finally, ED and the Department of Health and Human Services must carry out a program, beginning on August 1, 2021, to provide at least six notices to borrowers that normal payment obligations will resume.

To expand loan relief to all Federal student loan borrowers, and for 
                            other purposes.

    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 ``COVID-19 Student Loan Relief 
Extension Act''.

SEC. 2. EXPANDING LOAN RELIEF TO ALL FEDERAL STUDENT LOAN BORROWERS.

    Section 3502(a) of division A of the Coronavirus Aid, Relief, and 
Economic Security Act (Public Law 116-136) is amended--
            (1) by redesignating paragraphs (2) through (5) as 
        paragraphs (3) through (6), respectively; and
            (2) by inserting after paragraph (1) the following:
            ``(2) Federal student loan.--The term `Federal student 
        loan' means a loan--
                    ``(A) made under part D, part B, or part E of title 
                IV of the Higher Education Act of 1965 (20 U.S.C. 1070 
                et seq.), and held by the Department of Education;
                    ``(B) made, insured, or guaranteed under part B of 
                such title, or made under part E of such title, and not 
                held by the Department of Education; or
                    ``(C) made under--
                            ``(i) subpart II of part A of title VII of 
                        the Public Health Service Act (42 U.S.C. 292q 
                        et seq.); or
                            ``(ii) part E of title VIII of the Public 
                        Health Service Act (42 U.S.C. 297a et seq.).''.

SEC. 3. EXTENDING THE LENGTH OF BORROWER RELIEF DUE TO THE CORONAVIRUS 
              EMERGENCY.

    Section 3513 of division A of the Coronavirus Aid, Relief, and 
Economic Security Act (Public Law 116-136) is amended--
            (1) by amending subsection (a) to read as follows:
    ``(a) Suspension of Payments.--
            ``(1) In general.--During the period beginning on March 13, 
        2020, and ending 30 days after the termination date of the 
        public health emergency declared by the Secretary of Health and 
        Human Services on January 31, 2020, under section 319 of the 
        Public Health Services Act (42 U.S.C. 247d) in response to 
        COVID-19, the Secretary or, as applicable, the Secretary of 
        Health and Human Services, shall suspend all payments due on 
        Federal student loans.
            ``(2) Transition period.--For one additional 30-day period 
        beginning on the day after the last day of the suspension 
        period described in subsection (a), the Secretary or, as 
        applicable, the Secretary of Health and Human Services, shall 
        ensure that any missed payments on a Federal student loan by a 
        borrower during such additional 30-day period--
                    ``(A) do not result in collection fees or penalties 
                associated with late payments; and
                    ``(B) are not reported to any consumer reporting 
                agency or otherwise impact the borrower's credit 
                history.
            ``(3) Determination of compensation.--The Secretary or, as 
        applicable, the Secretary of Health and Human Services shall--
                    ``(A) with respect to a holder of a Federal student 
                loan defined in subparagraph (B) or (C) of section 
                3502(a)(2)--
                            ``(i) determine any losses for such holder 
                        due to the suspension of payments on such loan 
                        under paragraph (1); and
                            ``(ii) establish reasonable compensation 
                        for such losses; and
                    ``(B) not later than 60 days after the date of 
                enactment of the COVID-19 Student Loan Relief Extension 
                Act, with respect to a borrower who made a payment on a 
                Federal student loan defined in subparagraph (B) or (C) 
                of section 3502(a)(2) during the period beginning on 
                March 13, 2020, and ending on such date of enactment, 
                the Secretary shall pay to the borrower, an amount 
                equal to the lower of--
                            ``(i) the amount paid by the borrower on 
                        such loan during such period; or
                            ``(ii) the amount that was due on such loan 
                        during such period.
            ``(4) Recertification.--A borrower who is repaying a 
        Federal student loan pursuant to an income-contingent repayment 
        plan under section 455(d)(1)(D) of the Higher Education Act of 
        1965 (20 U.S.C. 1087e(d)(1)(D)) or an income-based repayment 
        plan under section 493C of such Act (20 U.S.C. 1098e) shall not 
        be required to recertify the income or family size of the 
        borrower under such plan prior to December 31, 2021.'';
            (2) in subsection (c), by striking ``part D or B of title 
        IV of the Higher Education Act of 1965 (20 U.S.C. 1087a et 
        seq.; 1071 et seq.)'' and inserting ``part B, D, or E of title 
        IV of the Higher Education Act of 1965 (20 U.S.C. 1087a et 
        seq.; 1071 et seq.; 1087aa et seq.)'';
            (3) in subsection (d), by striking ``During the period in 
        which the Secretary suspends payments on a loan under 
        subsection (a), the Secretary'' and inserting ``During the 
        period in which payments on a Federal student loan are 
        suspended under subsection (a), the Secretary or, as 
        applicable, the Secretary of Health and Human Services'';
            (4) in subsection (e), by striking ``During the period in 
        which the Secretary suspends payments on a loan under 
        subsection (a), the Secretary'' and inserting ``During the 
        period in which payments on a Federal student loan are 
        suspended under subsection (a), the Secretary or, as 
        applicable, the Secretary of Health and Human Services''; and
            (5) in subsection (f), by striking ``the Secretary'' and 
        inserting ``the Secretary or, as applicable, the Secretary of 
        Health and Human Services,''.

SEC. 4. NO INTEREST ACCRUAL.

    Section 3513(b) of division A of the Coronavirus Aid, Relief, and 
Economic Security Act (Public Law 116-136) is amended to read as 
follows:
    ``(b) Providing Interest Relief.--
            ``(1) No accrual of interest.--
                    ``(A) In general.--During the period described in 
                subparagraph (D), interest on a Federal student loan 
                shall not accrue or shall be paid by the Secretary (or 
                the Secretary of Health and Human Services) during--
                            ``(i) the repayment period of such loan;
                            ``(ii) any period excluded from the 
                        repayment period of such loan (including any 
                        period of deferment or forbearance);
                            ``(iii) any period in which the borrower of 
                        such loan is in a grace period; or
                            ``(iv) any period in which the borrower of 
                        such loan is in default on such loan.
                    ``(B) Direct loans and department of education held 
                ffel and perkins loans.--For purposes of subparagraph 
                (A), interest shall not accrue on a Federal student 
                loan defined in section 3502(a)(2)(A).
                    ``(C) FFEL and perkins loans not held by the 
                department of education and hhs loans.--For purposes of 
                subparagraph (A)--
                            ``(i) in the case of a Federal student loan 
                        defined in section 3502(a)(2)(B), the Secretary 
                        shall pay, on a monthly basis, the amount of 
                        interest due on the unpaid principal of such 
                        loan to the holder of such loan, except that 
                        any payments made under this clause shall not 
                        affect payment calculations under section 438 
                        of the Higher Education Act of 1965 (20 U.S.C. 
                        1087-1); and
                            ``(ii) in the case of a Federal student 
                        loan defined in section 3502(a)(2)(C), the 
                        Secretary of Health and Human Services shall 
                        pay, on a monthly basis, the amount of interest 
                        due on the unpaid principal of such loan to the 
                        holder of such loan.
                    ``(D) Period described.--
                            ``(i) In general.--The period described in 
                        this subparagraph is the period beginning on 
                        March 13, 2020, and ending the day following 
                        the date of the enactment of the COVID-19 
                        Student Loan Relief Extension Act that is 2 
                        months after the national U-5 measure of labor 
                        underutilization shows initial signs of 
                        recovery.
                            ``(ii) Definitions.--In this subparagraph:
                                    ``(I) National u-5 measure of labor 
                                underutilization.--The term `national 
                                U-5 measure of labor underutilization' 
                                means the seasonally-adjusted, monthly 
                                U-5 measure of labor underutilization 
                                published by the Bureau of Labor 
                                Statistics.
                                    ``(II) Initial signs of recovery.--
                                The term `initial signs of recovery' 
                                means that the average national U-5 
                                measure of labor underutilization for 
                                months in the most recent 3-
                                consecutive-month period for which data 
                                are available--
                                            ``(aa) is lower than the 
                                        highest value of the average 
                                        national U-5 measure of labor 
                                        underutilization for a 3-
                                        consecutive-month period during 
                                        the period beginning in March 
                                        2020 and the most recent month 
                                        for which data from the Bureau 
                                        of Labor Statistics are 
                                        available by an amount that is 
                                        equal to or greater than one-
                                        third of the difference 
                                        between--

                                                    ``(AA) the highest 
                                                value of the average 
                                                national U-5 measure of 
                                                labor underutilization 
                                                for a 3-consecutive-
                                                month period during 
                                                such period; and

                                                    ``(BB) the value of 
                                                the average national U-
                                                5 measure of labor 
                                                underutilization for 
                                                the 3-consecutive-month 
                                                period ending in 
                                                February 2020; and

                                            ``(bb) has decreased for 
                                        each month during the most 
                                        recent 2 consecutive months for 
                                        which data from the Bureau of 
                                        Labor Statistics are available.
                    ``(E) Other definitions.--In this paragraph:
                            ``(i) Default.--The term `default'--
                                    ``(I) in the case of a Federal 
                                student loan made, insured, or 
                                guaranteed under part B or D of the 
                                Higher Education Act of 1965, has the 
                                meaning given such term in section 
                                435(l) of the Higher Education Act of 
                                1965 (20 U.S.C. 1085);
                                    ``(II) in the case of a Federal 
                                student loan made under part E of the 
                                Higher Education Act of 1965, has the 
                                meaning given such term in section 
                                674.2 of title 34, Code of Federal 
                                Regulations (or successor regulations); 
                                or
                                    ``(III) in the case of a Federal 
                                student loan defined in section 
                                3502(a)(2)(C), has the meaning given 
                                such term in section 721 or 835 of the 
                                Public Health Service Act (42 U.S.C. 
                                292q, 297a), as applicable.
                            ``(ii) Grace period.--The term `grace 
                        period' means--
                                    ``(I) in the case of a Federal 
                                student loan made, insured, or 
                                guaranteed under part B or D of the 
                                Higher Education Act of 1965, the 6-
                                month period after the date the student 
                                ceases to carry at least one-half the 
                                normal full-time academic workload, as 
                                described in section 428(b)(7) of the 
                                Higher Education Act of 1965 (20 U.S.C. 
                                1078(b)(7));
                                    ``(II) in the case of a Federal 
                                student loan made under part E of the 
                                Higher Education Act of 1965, the 9-
                                month period after the date on which a 
                                student ceases to carry at least one-
                                half the normal full-time academic 
                                workload, as described in section 
                                464(c)(1)(A) of the Higher Education 
                                Act of 1965 (20 U.S.C. 
                                1087dd(c)(1)(A)); and
                                    ``(III) in the case of a Federal 
                                student loan defined in section 
                                3502(a)(2)(C), the 1-year period 
                                described in section 722(c) of the 
                                Public Health Service Act (42 U.S.C. 
                                292r(c)) or the 9-month period 
                                described in section 836(b)(2) of such 
                                Act (42 U.S.C. 297b(b)(2)), as 
                                applicable.
                            ``(iii) Repayment period.--The term 
                        `repayment period' means--
                                    ``(I) in the case of a Federal 
                                student loan made, insured, or 
                                guaranteed under part B or D of the 
                                Higher Education Act of 1965, the 
                                repayment period described in section 
                                428(b)(7) of the Higher Education Act 
                                of 1965 (20 U.S.C. 1078(b)(7));
                                    ``(II) in the case of a Federal 
                                student loan made under part E of the 
                                Higher Education Act of 1965, the 
                                repayment period described in section 
                                464(c)(4) of the Higher Education Act 
                                of 1965 (20 U.S.C. 1087dd(c)(4)); or
                                    ``(III) in the case of a Federal 
                                student loan defined in section 
                                3502(a)(2)(C), the repayment period 
                                described in section 722(c) or 
                                836(b)(2) of the Public Health Service 
                                Act (42 U.S.C. 292r(c), 297b(b)(2)), as 
                                applicable.
            ``(2) Interest refund in lieu of retroactive 
        applicability.--By not later than 60 days after the date of 
        enactment of the COVID-19 Student Loan Relief Extension Act, 
        the Secretary or, as applicable, the Secretary of Health and 
        Human Services, shall, for each Federal student loan defined in 
        subparagraph (B) or (C) of section 3502(a)(2) for which 
        interest was not paid by such Secretary pursuant to paragraph 
        (1) during the period beginning on March 13, 2020 and ending on 
        such date of enactment--
                    ``(A) determine the amount of interest due (or that 
                would have been due in the absence of being voluntarily 
                paid by the holder of such loan) on such loan during 
                the period beginning March 13, 2020, and ending on such 
                date of enactment; and
                    ``(B) refund the amount of interest calculated 
                under subparagraph (A), by--
                            ``(i) paying the holder of the loan the 
                        amount of the interest calculated under 
                        subparagraph (A), to be applied to the loan 
                        balance for the borrower of such loan; or
                            ``(ii) if there is no outstanding balance 
                        or payment due on the loan as of the date on 
                        which the refund is to be provided, providing a 
                        payment in the amount of the interest 
                        calculated under subparagraph (A) directly to 
                        the borrower.
            ``(3) Suspension of interest capitalization.--
                    ``(A) In general.--With respect to any Federal 
                student loan, interest that accrued but had not been 
                paid prior to March 13, 2020, and had not been 
                capitalized as of such date, shall not be capitalized.
                    ``(B) Transition.--The Secretary or, as applicable, 
                the Secretary of Health and Human Services, shall 
                ensure that any interest on a Federal student loan that 
                is capitalized in violation of subparagraph (A) is 
                corrected and the balance of principal and interest due 
                for the Federal student loan is adjusted 
                accordingly.''.

SEC. 5. NOTICE TO BORROWERS.

    Section 3513(g) of division A of the Coronavirus Aid, Relief, and 
Economic Security Act (Public Law 116-136) is amended--
            (1) in the matter preceding paragraph (1), by striking 
        ``the Secretary'' and inserting ``the Secretary or, as 
        applicable, the Secretary of Health and Human Services,'';
            (2) in paragraph (1)(D), by striking the period and 
        inserting a semicolon;
            (3) in paragraph (2)--
                    (A) in the matter preceding subparagraph (A), by 
                striking ``August 1, 2020'' and inserting ``August 1, 
                2021'';
                    (B) by amending subparagraph (B) to read as 
                follows:
                    ``(B) that--
                            ``(i) a borrower of a Federal student loan 
                        made, insured, or guaranteed under part B or D 
                        of title IV of the Higher Education Act of 1965 
                        may be eligible to enroll in an income-
                        contingent repayment plan under section 
                        455(d)(1)(D) of the Higher Education Act of 
                        1965 (20 U.S.C. 1087e(d)(1)(D)) or an income-
                        based repayment plan under section 493C of such 
                        Act (20 U.S.C. 1098e), including a brief 
                        description of such repayment plans; and
                            ``(ii) in the case of a borrower of a 
                        Federal student loan defined in section 
                        3502(a)(2)(C) or made under part E of title IV 
                        of the Higher Education of 1965, the borrower 
                        may be eligible to enroll in such a repayment 
                        plan if the borrower consolidates such loan 
                        with a loan described in clause (i) of this 
                        subparagraph, and receives a Federal Direct 
                        Consolidation Loan under part D of the Higher 
                        Education of 1965 (20 U.S.C. 1087a et seq.); 
                        and''; and
                    (C) by adding at the end the following:
            ``(3) in a case in which the accrual of interest on Federal 
        student loans is suspended under subsection (b)(1) beyond 
        September 30, 2021, during the 2-month period beginning on the 
        date on which the national U-5 measure of labor 
        underutilization shows initial signs of recovery (as such terms 
        are defined in subsection (b)(1)(D)) carry out a program to 
        provide not less than 6 notices by postal mail, telephone, or 
        electronic communication to borrowers--
                    ``(A) indicating when the interest on Federal 
                student loans of the borrower will resume accrual and 
                capitalization; and
                    ``(B) the information described in paragraph 
                (2)(B).''.
                                 <all>