Title: Student Loan Advocacy Act
Policy area: Education

Summary:
Student Loan Advocacy Act
This bill revises the purpose, authority, and management of the Office of Federal Student Aid (FSA), and it establishes the Office of the Borrower Advocate within the FSA to assist borrowers in resolving certain problems.
The FSA is the performance-based organization responsible for managing the administrative and oversight functions supporting federal student aid programs. The bill places certain transparency, oversight, and accountability requirements (e.g., data collection, sharing, and publication) on the FSA, and it revises requirements related to the FSA's performance plan and reporting on such performance.
The bill also establishes the Office of the Borrower Advocate to replace the Student Loan Ombudsman that is currently responsible for informally resolving complaints from student loan borrowers. This office shall (1) assist student loan borrowers in resolving problems with the FSA; (2) compile, analyze, publish, and attempt to resolve borrowers' complaints; and (3) make recommendations with respect to federal student loan programs and the experiences of borrowers in repayment under such programs. The bill also places additional requirements on the office such as making certain student loan oversight information available to the public.

[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4596 Introduced in House (IH)]

<DOC>






116th CONGRESS
  1st Session
                                H. R. 4596

 To improve service to students and other participants in the Federal 
 student financial assistance programs, to establish the Office of the 
Borrower Advocate to replace the Student Loan Ombudsman, and for other 
                               purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            October 1, 2019

 Ms. Omar (for herself and Ms. Scanlon) introduced the following bill; 
       which was referred to the Committee on Education and Labor

_______________________________________________________________________

                                 A BILL


 
 To improve service to students and other participants in the Federal 
 student financial assistance programs, to establish the Office of the 
Borrower Advocate to replace the Student Loan Ombudsman, 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 Loan Advocacy Act''.

SEC. 2. PERFORMANCE-BASED ORGANIZATION FOR DELIVERY OF FEDERAL STUDENT 
              FINANCIAL ASSISTANCE.

    (a) PBO.--Section 141 of the Higher Education Act of 1965 (20 
U.S.C. 1018) is amended--
            (1) in subsection (a), by amending paragraph (2) to read as 
        follows:
            ``(2) Purposes.--The purposes of the PBO are as follows:
                    ``(A) To prioritize students and borrowers in the 
                decisionmaking process of the PBO.
                    ``(B) To improve service to students and other 
                participants in the Federal student financial 
                assistance programs authorized under title IV.
                    ``(C) To make such programs more understandable to 
                students and their parents.
                    ``(D) To increase the efficiency and effectiveness 
                of such programs for students and their parents.
                    ``(E) To manage the costs of administering such 
                programs.
                    ``(F) To increase the accountability of the 
                officials responsible for administering the operational 
                aspects of such programs.
                    ``(G) To increase oversight of institutions, 
                contractors, and third party servicers that participate 
                in the Federal student financial assistance programs 
                authorized under title IV.
                    ``(H) To provide greater flexibility in the 
                management and administration of such programs.
                    ``(I) To implement open, common, integrated systems 
                for the delivery of Federal student financial 
                assistance programs authorized under title IV.
                    ``(J) To develop and maintain a student financial 
                assistance system that contains complete, accurate, and 
                timely data to ensure program integrity.
                    ``(K) To increase transparency in the operations 
                and outcomes of Federal student financial assistance 
                programs authorized under title IV.'';
            (2) in subsection (b)--
                    (A) in paragraph (1)--
                            (i) by redesignating subparagraphs (B) and 
                        (C) as subparagraphs (C) and (D), respectively; 
                        and
                            (ii) by inserting after subparagraph (A) 
                        the following:
                    ``(B) implement oversight and accountability 
                measures to ensure that the PBO carries out its duties 
                under this section efficiently, effectively, and in a 
                manner that accomplishes the purposes specified in 
                subsection (a)(2);'';
                    (B) in paragraph (2)(A)--
                            (i) by redesignating clauses (ii) through 
                        (vi) as clauses (iii) through (vii);
                            (ii) by inserting after clause (i) the 
                        following:
                            ``(ii) in accordance with paragraph (3), 
                        the collection, publication, and sharing of 
                        longitudinal data that may be used to evaluate 
                        Federal student financial assistance programs 
                        authorized under title IV, including the 
                        outcomes such programs achieve;''; and
                            (iii) in clause (vii), as so redesignated, 
                        by inserting ``, including oversight of 
                        institutions, contractors, and third party 
                        servicers that participate in such programs'' 
                        after ``title IV'' ;
                    (C) by redesignating paragraphs (3) through (6) as 
                paragraphs (4) through (7), respectively; and
                    (D) by inserting after paragraph (2) the following:
            ``(3) Collection, sharing, and publication of data.--
                    ``(A) Collection.--The PBO shall collect 
                longitudinal data, including student-level data, that 
                shall be used to evaluate Federal student financial 
                assistance programs authorized under title IV.
                    ``(B) Sharing with nces.--The PBO shall make the 
                data collected under subparagraph (A) available to the 
                Commissioner of the National Center for Education 
                Statistics for purposes of research and policy 
                analysis.
                    ``(C) Sharing with researchers.--The Commissioner 
                of the National Center for Education Statistics shall 
                make the data shared under subparagraph (B) available 
                to researchers for vetted research and evaluation 
                purposes. Data made available to researchers under this 
                subparagraph shall not include any data that would 
                reveal personally identifiable information.
                    ``(D) Publication.--
                            ``(i) In general.--Not less frequently than 
                        once annually, and subject to clause (ii), the 
                        PBO shall make the data collected under 
                        subparagraph (A) available on a publicly 
                        accessible website of the Department of 
                        Education in a format that enables members of 
                        the public to easily retrieve, sort, and 
                        analyze the data.
                            ``(ii) Privacy protections.--The data made 
                        available under clause (i) shall not include--
                                    ``(I) student-level data; or
                                    ``(II) any data that would reveal 
                                personally identifiable information 
                                about an individual student.''.
            (3) by amending subsection (c) to read as follows:
    ``(c) Performance Plan, Report, and Briefing.--
            ``(1) Performance plan.--
                    ``(A) In general.--Not later than one year after 
                the date of the enactment of the Student Loan Advocacy 
                Act, and not less than once every five years 
                thereafter, the Secretary and Chief Operating Officer 
                shall agree on a performance plan for the PBO for the 
                succeeding 5 years that--
                            ``(i) establishes measurable quantitative 
                        and qualitative goals and objectives for the 
                        organization; and
                            ``(ii) aligns such goals and objectives 
                        with the purposes specified in subsection 
                        (a)(2).
                    ``(B) Consultation.--In developing the five-year 
                performance plan and any revision to the plan, the 
                Secretary and the Chief Operating Officer shall consult 
                with students, institutions, Congress, contractors, the 
                Borrower Advocate, student aid experts, including 
                consumer advocacy and research groups, the Director of 
                the Bureau of Consumer Financial Protection, State 
                attorneys general, and other relevant parties.
                    ``(C) Revisions.--The Secretary and Chief Operating 
                Officer may annually update the plan under paragraph 
                (1) to incorporate the recommendations made pursuant to 
                the consultation required under subparagraph (B) that 
                are accepted by the Secretary and the Chief Operating 
                Officer.
                    ``(D) Areas.--The plan developed under subparagraph 
                (A) shall address the responsibilities of the PBO in 
                the following areas:
                            ``(i) Improving service to students and 
                        other participants in the Federal student 
                        financial assistance programs authorized under 
                        title IV, including making those programs more 
                        understandable and accessible to students and 
                        their parents.
                            ``(ii) Managing the costs and increasing 
                        the efficiency of such programs.
                            ``(iii) Improving, integrating, and 
                        investing in the systems that support such 
                        programs.
                            ``(iv) Developing open, common, and 
                        integrated systems for such programs.
                            ``(v) The collection, publication, and 
                        sharing of data on such programs as described 
                        in subsection (b)(3).
                            ``(vi) Improving performance standards and 
                        outcomes with respect to institutions, 
                        contractors, and third party servicers that act 
                        as agents of the Department or as agents of 
                        institutions that participate in such programs.
                            ``(vii) Any other areas identified by the 
                        Secretary.
                    ``(E) Public availability.--Each plan developed 
                under subparagraph (A) shall be made available on a 
                publicly accessible website of the Department of 
                Education.
            ``(2) Annual report.--
                    ``(A) Report required.--Not later than one year 
                after the date of the enactment of the Student Loan 
                Advocacy Act and annually thereafter, the Secretary, 
                acting through the Chief Operating Officer, shall 
                submit to Congress an annual report on the performance 
                of the PBO.
                    ``(B) Contents.--The annual report shall include 
                the following:
                            ``(i) An evaluation of the extent to which 
                        the PBO met the goals and objectives contained 
                        in the five-year performance plan described in 
                        paragraph (1) for the preceding year.
                            ``(ii) A summary of the consultation 
                        process under paragraph (1)(B) for the 
                        preceding year, including the recommendations 
                        that were accepted or denied by the Chief 
                        Operating Officer during such year, and the 
                        rationale for accepting or denying such 
                        recommendations.
                            ``(iii) An independent financial audit of 
                        the expenditures of both the PBO and the 
                        programs administered by the PBO.
                            ``(iv) A summary of the actions taken by 
                        the PBO to address--
                                    ``(I) the findings of the audit 
                                described in clause (iii); and
                                    ``(II) consumer feedback.
                            ``(v) Financial and performance 
                        requirements applicable to the PBO under--
                                    ``(I) the Chief Financial Officers 
                                Act of 1990 (Public Law 101-576); or
                                    ``(II) the Government Performance 
                                and Results Act of 1993 (Public Law 
                                103-62).
                            ``(vi) The results achieved by the PBO 
                        during the preceding year and whether such 
                        results met the goals specified in the 
                        performance plan under paragraph (1).
                            ``(vii) With respect to the preceding year, 
                        the evaluation rating of the performance of the 
                        Chief Operating Officer and senior managers 
                        under subsections (d)(5) and (e)(2), including 
                        the amounts of bonus compensation awarded to 
                        the Chief Operating Officer and senior 
                        managers.
                            ``(viii) Recommendations for legislative 
                        and regulatory changes to improve service to 
                        students and their families, and to improve the 
                        efficiency and integrity of Federal student 
                        financial assistance programs authorized under 
                        title IV.
                            ``(ix) Financial statements that provide a 
                        rationale for appropriately funding the 
                        activities of the PBO.
                            ``(x) A summary of the management and 
                        compliance of contractors managed by the PBO in 
                        the preceding year, including corrective 
                        actions taken by the PBO with respect to such 
                        contractors.
                            ``(xi) A description of how the PBO used 
                        the authority under paragraph (5) of subsection 
                        (b) for making personnel and procurement 
                        decisions in the preceding year, including the 
                        number of individuals hired through such 
                        authority and the bonuses provided to staff 
                        during such year.
                            ``(xii) A summary of the oversight 
                        activities of institutions, contractors, and 
                        third party servicers that participate in the 
                        Federal student financial assistance programs 
                        authorized under title IV including--
                                    ``(I) fines levied on such 
                                institutions, contractors, and third 
                                party servicers, disaggregated by 
                                entity;
                                    ``(II) instances of fraud or 
                                misrepresentation by such institutions, 
                                contractors, or third party servicers; 
                                and
                                    ``(III) violations of provisions in 
                                this Act by such institutions, 
                                contractors, or third party servicers 
                                disaggregated by entity and type of 
                                violation.
                            ``(xiii) A summary of any improvements made 
                        with respect to transparency and any new types 
                        of data made available in the preceding year.
                            ``(xiv) A description of the progress made 
                        in the preceding year towards the specific 
                        measurable organization and individual goals 
                        specified in subsection (d)(5)(A).
                            ``(xv) The report submitted to the 
                        Secretary under subsection (f)(7).
                            ``(xvi) Other such information as the 
                        Director of the Office of Management and Budget 
                        shall prescribe for performance based 
                        organizations.
            ``(3) Consultation with stakeholders.--The Chief Operating 
        Officer, in preparing the annual report described in paragraph 
        (2), shall establish appropriate means to consult with 
        students, borrowers, institutions, student aid experts, 
        including consumer advocacy and research groups, the Director 
        of the Bureau of Consumer Financial Protection, and others 
        involved in the delivery and evaluation of student aid under 
        title IV--
                    ``(A) regarding the degree of satisfaction with the 
                delivery system; and
                    ``(B) to seek suggestions on means to improve the 
                performance of the delivery system.
            ``(4) Briefing on enforcement of program integrity.--The 
        Secretary shall, at the request of the authorizing committees, 
        provide to the authorizing committees a briefing on the steps 
        the Department of Education has taken to ensure--
                    ``(A) the experiences of students and borrowers are 
                accounted for in decision making; and
                    ``(B) that contractors, lenders, and guaranty 
                agencies and third party servicers are adhering to the 
                requirements of title IV, the terms of any contract 
                with the Secretary, consumer protection laws, Federal 
                regulations and guidelines, and directives of the PBO.
            ``(5) Coordination with the director of the bureau of 
        consumer financial protection.--Not later than 180 days after 
        the date of the enactment of the Student Loan Advocacy Act, the 
        Secretary shall enter into a memorandum of understanding with 
        the Private Education Loan Ombudsman in accordance with section 
        1035(c)(2) of the Dodd-Frank Wall Street Reform and Consumer 
        Protection Act (12 U.S.C. 5535(c)(2)).''.
            (4) in subsection (d)--
                    (A) in paragraph (1), by striking ``management 
                ability'' and all that follows through the period at 
                the end and inserting ``management ability, including 
                contractor management, expertise in the Federal student 
                financial assistance programs authorized under title 
                IV, experience with financial systems, and knowledge of 
                consumer financial protection laws, and without regard 
                to political affiliation or activity.'';
                    (B) by redesignating paragraphs (2) through (5) as 
                paragraphs (3) through (6);
                    (C) by inserting after paragraph (1) the following:
            ``(2) Restrictions.--
                    ``(A) Preservice and in-service restrictions.--An 
                individual may not serve as the Chief Operating Officer 
                if such individual--
                            ``(i) is employed by, or has a financial 
                        interest in, an entity that contracts with the 
                        PBO; or
                            ``(ii) was employed by, or had a financial 
                        interest in, any such entity in any of the five 
                        years preceding the date of the individual's 
                        appointment as the Chief Operating Officer.
                    ``(B) Postservice restrictions.--An individual who 
                served as the Chief Operating Officer may not accept 
                employment with an entity that contracts with the PBO 
                until a period of five years has elapsed following the 
                date on which such individual's service as the Chief 
                Operating Officer terminated.'';
                    (D) in paragraph (5), as so redesignated--
                            (i) in subparagraph (A)--
                                    (I) by inserting ``specific'' 
                                before ``measurable''; and
                                    (II) by inserting ``and metrics 
                                used to measure progress toward such 
                                goals'' before the period; and
                            (ii) in subparagraph (B), by inserting ``on 
                        the website of the Department'' before the 
                        period; and
                    (E) in paragraph (6), as so redesignated, by 
                amending subparagraph (B) to read as follows:
                    ``(B) Bonus authorized.--The Secretary may pay to 
                the Chief Operating Officer a bonus in an amount that 
                does not exceed 50 percent of such annual rate of basic 
                pay. The decision to pay such a bonus, and the amount 
                of the bonus, shall be based solely on the Secretary's 
                evaluation of the performance of the Chief Operating 
                Officer with respect to the goals set forth in the 
                performance agreement as described in paragraph 
                (5)(A).'';
            (5) in subsection (e)(2), by striking ``organization and 
        individual goals'' and inserting ``specific, measurable 
        organization and individual goals and the metrics used to 
        measure progress toward such goals. Performance agreements for 
        senior management responsible for procurement shall include 
        metrics that measure ability to oversee contractors.'';
            (6) by amending subsection (f) to read as follows:
    ``(f) Borrower Advocate.--
            ``(1) In general.--There is established in the PBO an 
        `Office of the Borrower Advocate' (referred to in this 
        subsection as the `Office'). The function of the Office shall 
        be to provide timely assistance to borrowers of loans made, 
        insured, or guaranteed under title IV by performing the duties 
        described in paragraph (6).
            ``(2) Head of office.--There shall be an official known as 
        the `Borrower Advocate' who shall serve as the head of the 
        Office. The Borrower Advocate shall be appointed by the 
        Secretary from among individuals who have worked closely with 
        the Federal student loan programs authorized under title IV.
            ``(3) Removal.--The Borrower Advocate may be removed only 
        by the Secretary who shall communicate the reasons for any such 
        removal to the authorizing committees.
            ``(4) Restrictions.--
                    ``(A) Preservice and in-service restrictions.--An 
                individual may not serve as the Borrower Advocate if 
                such individual--
                            ``(i) is employed by, or has a financial 
                        interest in, an entity that contracts with the 
                        PBO; or
                            ``(ii) was employed by, or had a financial 
                        interest in, any such entity in any of the five 
                        years preceding the date of the individual's 
                        appointment as the Borrower Advocate.
                    ``(B) Postservice restrictions.--An individual who 
                served as the Borrower Advocate may not accept 
                employment with an entity that contracts with the PBO 
                until a period of five years has elapsed following the 
                date on which such individual's service as the Borrower 
                Advocate terminated.
            ``(5) Staff.--The Office shall be staffed sufficiently to 
        carry out the responsibilities of the Office under this 
        subsection.
            ``(6) Duties of the borrower advocate.--The Office of the 
        Borrower Advocate shall--
                    ``(A) assist borrowers of loans made, insured, or 
                guaranteed under title IV in resolving problems with 
                the PBO and its contractors or other agents, including 
                by--
                            ``(i) receiving and reviewing complaints of 
                        such problems from borrowers;
                            ``(ii) working to resolve such complaints 
                        in a manner that is in the best interests of 
                        borrowers; and
                            ``(iii) transmitting such complaints to 
                        States and recognized accrediting agencies or 
                        associations, as appropriate;
                    ``(B) attempt to resolve complaints within the 
                Department of Education and with institutions of higher 
                education, lenders, guaranty agencies, loan servicers, 
                and other participants in the Federal student loan 
                programs authorized under title IV in a manner that 
                will improve the experience of the borrower;
                    ``(C) compile and analyze data on borrower 
                complaints and share such data with the Director of the 
                Bureau of Consumer Financial Protection;
                    ``(D) publish, with any personally identifiable 
                information redacted, such complaints and responses of 
                the Secretary to such complaints on the website of the 
                Department; and
                    ``(E) make appropriate recommendations to Congress, 
                the Chief Operating Officer, and Secretary with respect 
                to Federal student loan programs authorized under title 
                IV and the experiences of borrowers in repayment of 
                loans under such programs.
            ``(7) Public information.--The Chief Operating Officer 
        shall establish and maintain a public page on the website of 
        the Department of Education exclusively to provide members of 
        the public with information about the role of the PBO with 
        respect to the oversight of institutions of higher education, 
        lenders, guaranty agencies, contractors that contract with the 
        PBO, subcontractors of such contractors, and third party 
        servicers.
            ``(8) Report.--On an annual basis, the Borrower Advocate 
        shall submit to the Chief Operating Officer a report on the 
        activities of the Office during the preceding year that--
                    ``(A) identifies the activities carried out by the 
                Borrower Advocate;
                    ``(B) summarizes the complaints received from 
                borrowers, including the number of such complaints, and 
                explains the activities undertaken by the PBO to 
                address such complaints;
                    ``(C) proposes changes in the administrative 
                practices of the PBO to mitigate problems experienced 
                by borrowers; and
                    ``(D) identifies potential legislative changes 
                which may be appropriate to mitigate such problems.'';
            (7) by redesignating subsection (i) as subsection (j); and
            (8) by inserting after subsection (h) the following:
    ``(i) Third Party Servicer Defined.--In this section, the term 
`third party servicer' has the meaning given that term in section 
481(c).''.
    (b) Definition of Third-Party Servicer.--Section 481(c) of the 
Higher Education Act of 1965 (20 U.S.C. 1088(c)) is amended--
            (1) in the matter preceding paragraph (1), by striking 
        ``contract'' and inserting ``contract or other agreement, 
        including a revenue sharing arrangement,''; and
            (2) in paragraph (1), by striking ``, through either manual 
        or automated processing, any aspect of such institution's 
        student assistance programs'' and inserting ``services on 
        behalf of the institution receiving student assistance funds''.
    (c) Conforming Amendments.--
            (1) Section 433(b)(13) of the Higher Education Act of 1965 
        (20 U.S.C. 1083(b)(13)) is amended by striking ``Student Loan 
        Ombudsman'' and inserting ``Borrower Advocate''.
            (2) Section 433(e)(3)(E) of the Higher Education Act of 
        1965 (20 U.S.C. 1083(e)(3)(E)) is amended by striking ``Student 
        Loan Ombudsman'' and inserting ``Borrower Advocate''.
                                 <all>