Title: Student Debt Emergency Relief Act
Policy area: Education

Summary:
Student Debt Emergency Relief Act
This bill establishes and provides funds for federal student loan repayment assistance programs during a national emergency, including the public health emergency caused by the coronavirus (i.e., the virus that causes COVID-19).
Specifically, the bill requires the Department of Education (ED) to make monthly payments for borrowers of Federal Direct Loans, Federal Family Education Loans, and Perkins Loans during a national emergency. ED must also pay any interest on such loans during the emergency.
Additionally, ED must
ED must (1) make monthly payments until authorized by Congress to terminate the program, (2) carry out a 90-day transition period, and (3) apply a minimum amount of payments to loans for each borrower.
Payments made by ED as a result of a national emergency shall be excluded from the taxpayer's gross income.
Interest shall not be capitalized during or after the national emergency.

[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[H.R. 6363 Introduced in House (IH)]

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116th CONGRESS
  2d Session
                                H. R. 6363

To amend the Higher Education Act of 1965 to halt collection of certain 
                 student loans, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             March 23, 2020

   Ms. Pressley (for herself, Ms. Omar, Mr. Richmond, Mr. Welch, Ms. 
 Norton, Ms. Velazquez, Ms. Castor of Florida, Mr. Rush, Mr. Garcia of 
     Illinois, Mr. Deutch, Ms. Tlaib, Ms. Clarke of New York, Ms. 
    Schakowsky, Mr. Nadler, Mrs. Napolitano, Ms. Ocasio-Cortez, Mr. 
Grijalva, Mr. Carson of Indiana, Mr. Pocan, and Ms. Lee of California) 
 introduced the following bill; which was referred to the Committee on 
   Education and Labor, and in addition to the Committee on Ways and 
 Means, for a period to be subsequently determined by the Speaker, in 
   each case for consideration of such provisions as fall within the 
                jurisdiction of the committee concerned

_______________________________________________________________________

                                 A BILL


 
To amend the Higher Education Act of 1965 to halt collection of certain 
                 student loans, 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 ``Student Debt Emergency Relief Act''.

SEC. 2. PAYMENTS FOR STUDENT LOAN BORROWERS AS A RESULT OF A NATIONAL 
              EMERGENCY.

    (a) Payments for Student Loan Borrowers During a National 
Emergency.--
            (1) In general.--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 493D the following:

``SEC. 493E. PAYMENTS FOR STUDENT LOAN BORROWERS DURING A NATIONAL 
              EMERGENCY.

    ``(a) Definitions.--In this section:
            ``(1) Coronavirus.--The term `coronavirus' has the meaning 
        given the term in section 506 of the Coronavirus Preparedness 
        and Response Supplemental Appropriations Act, 2020 (Public Law 
        116-123).
            ``(2) Income-driven repayment.--The term `income-driven 
        repayment' means--
                    ``(A) income-based repayment authorized under 
                section 493C for loans made, insured, or guaranteed 
                under part B or part D; or
                    ``(B) income contingent repayment authorized under 
                section 455(e) for loans made under part D.
            ``(3) Involuntary collection.--The term `involuntary 
        collection' means--
                    ``(A) a wage garnishment authorized under section 
                488A of this Act or section 3720D of title 31, United 
                States Code;
                    ``(B) a reduction of tax refund by amount of debt 
                authorized under section 3720A of title 31, United 
                States Code;
                    ``(C) a reduction of any other Federal benefit 
                payment by administrative offset authorized under 
                section 3716 of title 31, United States Code (including 
                a benefit payment due to an individual under the Social 
                Security Act or any other provision described in 
                subsection (c)(3)(A)(i) of such section); and
                    ``(D) any other involuntary collection activity.
            ``(4) National emergency.--The term `national emergency' 
        means--
                    ``(A) a public health emergency related to the 
                coronavirus that is declared by the Secretary of Health 
                and Human Services pursuant to section 319 of the 
                Public Health Service Act (42 U.S.C. 247d); or
                    ``(B) a national emergency related to the 
                coronavirus declared by the President under the 
                National Emergencies Act (50 U.S.C. 1601 et seq.).
    ``(b) National Emergency Student Loan Repayment Assistance.--
            ``(1) Authority.--Upon the declaration of a national 
        emergency, the Secretary shall for each borrower of a loan 
        made, insured, or guaranteed under part B, D, or E, pay the 
        total amount due for such month on the loan, based on the 
        payment plan selected by the borrower or the borrower's loan 
        status.
            ``(2) No capitalization of interest.--With respect to any 
        loan during a national emergency period, interest due on loans 
        made, insured, or guaranteed under part B, D, or E during such 
        period shall not be capitalized at any time during or after the 
        national emergency.
            ``(3) Applicability of payments.--Any payment made by the 
        Secretary under this section shall be considered by the 
        Secretary, or by a lender with respect to a loan made, insured, 
        or guaranteed under part B--
                    ``(A) as a qualifying payment under the public 
                service loan forgiveness program under section 455(m), 
                if the borrower would otherwise qualify under such 
                section;
                    ``(B) in the case of a borrower enrolled in an 
                income-driven repayment plan, as a qualifying payment 
                for the purpose of calculating eligibility for loan 
                forgiveness for the borrower in accordance with section 
                493C(b)(7) or section 455(d)(1)(D), as the case may be; 
                and
                    ``(C) in the case of a borrower in default, as an 
                on-time monthly payment for purposes of loan 
                rehabilitation pursuant to section 428F(a).
            ``(4) Reporting to consumer reporting agencies.--During the 
        period in which the Secretary is making payments on a loan 
        under paragraph (1), the Secretary shall ensure that, for the 
        purpose of reporting information about the loan to a consumer 
        reporting agency, any payment made by the Secretary is treated 
        as if it were a regularly scheduled payment made by a borrower.
            ``(5) Notice of payments and program.--Not later than 15 
        days following the date of enactment of the Student Debt 
        Emergency Relief Act, and monthly thereafter during the period 
        of a national emergency, the Secretary shall provide a notice 
        to all borrowers of loans made, insured, or guaranteed under 
        part B, D, or E--
                    ``(A) informing borrowers of the actions taken 
                under this section;
                    ``(B) providing borrowers with an easily accessible 
                method to opt out of the benefits provided under this 
                section; and
                    ``(C) notifying the borrower that the program under 
                this section is a temporary program and will end after 
                the national emergency ends.
            ``(6) Suspension of involuntary collection.--In the event 
        of a national emergency, the Secretary, or other holder of a 
        loan made, insured, or guaranteed under part B, D, or E, shall 
        immediately take action to halt all involuntary collection 
        related to the loan.
            ``(7) Mandatory forbearance.--During the period in which 
        the Secretary is making payments on a loan under paragraph (1), 
        the Secretary, or a lender or guaranty agency for a loan made 
        under part B, shall grant the borrower forbearance, in the form 
        of a temporary cessation of all payments on the loan other than 
        the payments of interest and principal on the loan that are 
        made under that paragraph. In the case of a borrower who is 
        delinquent but who is not yet in default prior to the time when 
        the Secretary begins making payments under paragraph (1), the 
        Secretary, or a lender or guaranty agency for a loan made under 
        part B, shall grant the borrower forbearance retroactively to 
        address any such delinquency.
    ``(c) Waiver of Interest During National Emergency.--
Notwithstanding any other provision of law, the Secretary shall pay any 
interest that would otherwise be charged or accrue during a national 
emergency on any loan made, insured, or guaranteed under part B, D, or 
E.
    ``(d) Termination and Transition Period.--Secretary shall make 
payments on a loan under subsection (b)(1) until the Secretary is 
authorized by Congress to cease making such payments and to terminate 
the program. Upon the termination of the authority of the Secretary to 
make payments on a loan under subsection (b)(1), the Secretary shall 
carry out a program to provide for a transition period of 90 days, 
beginning on the day the termination of the authority of the Secretary 
to make payments on a loan under subsection (b)(1), during which--
            ``(1) the Secretary shall provide not less than 3 notices 
        to borrowers indicating when the borrower's normal payment 
        obligations will resume; and
            ``(2) any missed payments by a borrower under part B, D, or 
        E shall not--
                    ``(A) result in fees or penalties; or
                    ``(B) be reported to any consumer reporting agency 
                or otherwise impact the borrower's credit history.
    ``(e) Implementation in FFEL Entities.--To facilitate 
implementation of this section--
            ``(1) lenders and guaranty agencies holding loans made, 
        insured, or guaranteed under part B shall report, to the 
        satisfaction of the Secretary, information to verify at the 
        borrower level the amount of payments made under this section; 
        and
            ``(2) the Secretary shall have the authority to establish a 
        payment schedule for purposes of this section for loans made, 
        insured, or guaranteed under part B and not held by the 
        Secretary.
    ``(f) Waivers.--In carrying out this section, the Secretary may 
waive the application of--
            ``(1) subchapter I of chapter 35 of title 44, United States 
        Code;
            ``(2) the master calendar requirements under section 482;
            ``(3) negotiated rulemaking under section 492; and
            ``(4) the requirement to publish the notices related to the 
        system of records of the agency before implementation required 
        under paragraphs (4) and (11) of section 552a(e) of title 5, 
        United States Code (commonly known as the `Privacy Act of 
        1974'), except that the notices shall be published not later 
        than 180 days after the date of enactment of the Student Debt 
        Emergency Relief Act.
    ``(g) Authorization of Mandatory Funding for Implementation.--
            ``(1) In general.--There are authorized to be appropriated, 
        and there are appropriated, from amounts in the Treasury not 
        already appropriated--
                    ``(A) $50,000,000 for fiscal year 2020 for the 
                costs associated with implementation and coordination 
                required of this section; and
                    ``(B) such sums as are necessary to provide the 
                payments and interest cancellation provided under this 
                section.
            ``(2) Availability.--Amounts made available under paragraph 
        (1) shall--
                    ``(A) be in addition to any other amounts available 
                to carry out this section; and
                    ``(B) remain available until expended.''.
            (2) FFEL amendment.--Section 428(c)(8) of the Higher 
        Education Act of 1965 (20 U.S.C. 1078(c)(8)) is amended by 
        striking ``and for which'' and all that follows through ``this 
        subsection''.
    (b) Minimum Relief for Student Loan Borrowers as a Result of a 
National Emergency.--Part G of title IV of the Higher Education Act of 
1965 (20 U.S.C. 1088 et seq.), as amended by subsection (a), is further 
amended by inserting after section 493E the following:

``SEC. 493F. MINIMUM RELIEF FOR STUDENT LOAN BORROWERS AS A RESULT OF A 
              NATIONAL EMERGENCY.

    ``(a) Minimum Student Loan Relief as a Result of a National 
Emergency.--Not later than 90 days after termination of the authority 
of the Secretary to make payments on a loan under section 493(E)(b)(1), 
the Secretary shall, for each borrower of a loan made under part B, D, 
or E, apply to the total outstanding balance due on all such loans of 
the borrower, an amount equal to the lesser of--
            ``(1) the difference between $30,000 and the total amount 
        of payments made by the Secretary under section 493E(b) on such 
        loans of the borrower during the period of time when the 
        Secretary was authorized to make payments on a loan under 
        section 493E(b)(1); or
            ``(2) the total amount of outstanding principal and 
        interest due on such loans of the borrower, as of the date of 
        the calculation under this subsection.
    ``(b) Data To Implement.--Contractors of the Secretary and lenders 
and guaranty agencies holding loans made, insured, or guaranteed under 
part B shall report, to the satisfaction of the Secretary, the 
information necessary to calculate the amount to be applied under 
subsection (a).''.

SEC. 3. EXCLUSION FROM GROSS INCOME.

    (a) In General.--Part III of subchapter B of chapter 1 of the 
Internal Revenue Code of 1986 is amended by inserting after section 
139H the following new section:

``SEC. 139I. STUDENT LOAN PAYMENTS RESULTING FROM A NATIONAL EMERGENCY.

    ``Gross income shall not include any payment made on behalf of the 
taxpayer under section 493E(b)(1) or 493F of the Higher Education Act 
of 1965.''.
    (b) Clerical Amendment.--The table of sections for part III of 
subchapter B of chapter 1 of the Internal Revenue Code of 1986 is 
amended by inserting after the item relating to section 139H the 
following new item:

``Sec. 139I. Student loan payments resulting from a national 
                            emergency.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2019.
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