Title: Emergency Relief for Student Borrowers Act of 2020
Policy area: Education

Summary:
Emergency Relief for Student Borrowers Act of 2020
This bill establishes federal and private student loan repayment assistance programs during the COVID-19 (i.e., coronavirus disease 2019) national emergency.

[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[H.R. 6316 Introduced in House (IH)]

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116th CONGRESS
  2d Session
                                H. R. 6316

To provide relief for Federal and private student loan borrowers during 
             the COVID-19 pandemic, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             March 23, 2020

   Ms. Dean introduced the following bill; which was referred to the 
Committee on Education and Labor, and in addition to the Committees on 
Financial Services, and 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 provide relief for Federal and private student loan borrowers during 
             the COVID-19 pandemic, 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 ``Emergency Relief for Student 
Borrowers Act of 2020''.

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

    (a) 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 THE COVID-19 
              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) COVID-19 emergency period.--For purposes of this Act, 
        the term `COVID-19 emergency period' means the period that 
        begins upon the date of the enactment of this Act and ends upon 
        the date of the termination by the Federal Emergency Management 
        Administration of the emergency declared on March 13, 2020, by 
        the President under the Robert T. Stafford Disaster Relief and 
        Emergency Assistance Act (42 U.S.C. 4121 et seq.) relating to 
        the Coronavirus Disease 2019 (COVID-19) pandemic.
    ``(b) COVID-19 National Emergency Student Loan Repayment 
Assistance.--
            ``(1) Authority.--Effective on the date of the enactment of 
        this section, during the COVID-19 emergency period and the 6-
        month period immediately following, the Secretary of Education 
        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 in repayment during the COVID-19 national emergency period 
        and the 6-month period immediately following, 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 the 
        COVID-19 national emergency period and the 6-month period 
        immediately following.
            ``(3) Applicability of payments.--Any payment made by the 
        Secretary of Education under this section shall be considered 
        by the Secretary of Education, 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 of Education 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 this section, and 
        monthly thereafter during the COVID-19 national emergency 
        period and the 6-month period immediately following, the 
        Secretary of Education 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 6 
                months after the COVID-19 national emergency period 
                ends.
            ``(6) Suspension of involuntary collection.--During the 
        COVID-19 national emergency period and the 6-month period 
        immediately following, the Secretary of Education, 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 of Education 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 as follows:
                    ``(A) A temporary cessation of all payments on the 
                loan other than the payments of interest and principal 
                on the loan that are made under paragraph (1).
                    ``(B) For borrowers who are delinquent but who are 
                not yet in default before the date on which the 
                Secretary begins making payments under paragraph (1), 
                the retroactive application of forbearance to address 
                any delinquency.''.
    (b) 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''.

SEC. 3. PAYMENTS FOR PRIVATE EDUCATION LOAN BORROWERS AS A RESULT OF 
              THE COVID-19 NATIONAL EMERGENCY.

    Section 140 of the Truth in Lending Act (15 U.S.C. 1650) is amended 
by adding at the end the following new subsection:
    ``(h) COVID-19 National Emergency Private Education Loan Repayment 
Assistance.--
            ``(1) Authority.--Effective on the date of the enactment of 
        this section, for the duration of the COVID-19 emergency period 
        and the 6-month period immediately following, the Secretary of 
        the Treasury shall, for each borrower of a private education 
        loan, 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 in repayment during the COVID-19 national emergency period 
        and the 6-month period immediately following, interest due on a 
        private education loan during such period shall not be 
        capitalized at any time during the COVID-19 national emergency 
        period and the 6-month period immediately following.
            ``(3) Reporting to consumer reporting agencies.--During the 
        period in which the Secretary of the Treasury 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.
            ``(4) Notice of payments and program.--Not later than 15 
        days following the date of enactment of this subsection, and 
        monthly thereafter during the COVID-19 national emergency 
        period and the 6-month period immediately following, the 
        Secretary of the Treasury shall provide a notice to all 
        borrowers of private education loans--
                    ``(A) informing borrowers of the actions taken 
                under this subsection;
                    ``(B) providing borrowers with an easily accessible 
                method to opt out of the benefits provided under this 
                subsection; and
                    ``(C) notifying the borrower that the program under 
                this subsection is a temporary program and will end 6 
                months after the COVID-19 national emergency period 
                ends.
            ``(5) Suspension of involuntary collection.--During the 
        COVID-19 national emergency period and the 6-month period 
        immediately following, the holder of a private education loan 
        shall immediately take action to halt all involuntary 
        collection related to the loan.
            ``(6) Mandatory forbearance.--During the period in which 
        the Secretary of the Treasury is making payments on a loan 
        under paragraph (1), the servicer of such loan shall grant the 
        borrower forbearance as follows:
                    ``(A) A temporary cessation of all payments on the 
                loan other than the payments of interest and principal 
                on the loan that are made under paragraph (1).
                    ``(B) For borrowers who are delinquent but who are 
                not yet in default before the date on which the 
                Secretary begins making payments under paragraph (1), 
                the retroactive application of forbearance to address 
                any delinquency.
            ``(7) Data to implement.--Holders and servicers of private 
        education loans shall report, to the satisfaction of the 
        Secretary of the Treasury, the information necessary to 
        calculate the amount to be paid under this section.
            ``(8) COVID-19 emergency period defined.--In this 
        subsection, the term `COVID-19 emergency period' means the 
        period that begins upon the date of the enactment of this Act 
        and ends upon the date of the termination by the Federal 
        Emergency Management Administration of the emergency declared 
        on March 13, 2020, by the President under the Robert T. 
        Stafford Disaster Relief and Emergency Assistance Act (42 
        U.S.C. 4121 et seq.) relating to the Coronavirus Disease 2019 
        (COVID-19) pandemic.''.

SEC. 4. MINIMUM RELIEF FOR FEDERAL AND PRIVATE STUDENT LOAN BORROWERS 
              AS A RESULT OF THE COVID-19 NATIONAL EMERGENCY.

    (a) Minimum Student Loan Relief as a Result of the COVID-19 
National Emergency.--Not later than 270 days after the last day of the 
COVID-19 emergency period, the Secretaries concerned shall jointly 
carry out a program under which a qualified borrower, with respect to 
the covered loans and private education of loans of such qualified 
borrower, shall receive in accordance with subsection (c) an amount 
equal to the lesser of the following:
            (1) The total amount of each covered loan and each private 
        education loan of the borrower; or
            (2) $10,000.
    (b) Notification of Borrowers.--Not later than 270 days after the 
last day of the COVID-19 emergency period, the Secretaries concerned 
shall notify each qualified borrower of--
            (1) the requirements to provide loan relief to such 
        borrower under this section; and
            (2) the opportunity for such borrower to make an election 
        under subsection (c)(1) with respect to the application of such 
        loan relief to the covered loans and private education loans of 
        such borrower.
    (c) Distribution of Funding.--
            (1) Election by borrower.--Not later than 45 days after a 
        notice is sent under subsection (b), a qualified borrower may 
        elect to apply the amount determined with respect to such 
        borrower under subsection (a) to--
                    (A) any covered loan of the borrower;
                    (B) any private education loan of the borrower; and
                    (C) any combination of the loans described in 
                subparagraphs (A) and (B).
            (2) Automatic payment.--
                    (A) In general.--In the case of a qualified 
                borrower who does not make an election under paragraph 
                (1) before the date described in such paragraph, the 
                Secretaries concerned shall apply the amount determined 
                with respect to such borrower under subsection (a) in 
                order of the covered loan or private education loan of 
                the qualified borrower with the highest interest rate.
                    (B) Equal interest rates.--In case of two or more 
                covered loans or private education loans described in 
                subparagraph (A) with equal interest rates, the 
                Secretaries concerned shall apply the amount determined 
                with respect to such borrower under subsection (a) 
                first to the loan with the highest principal.
    (d) Data To Implement.--
            (1) Secretary of education.--Contractors of the Secretary 
        of Education and lenders and guaranty agencies holding loans 
        made, insured, or guaranteed under part B shall report, to the 
        satisfaction of the Secretary of Education, the information 
        necessary to calculate the amount to be applied under 
        subsection (a).
            (2) Secretary of treasury.--Holders and servicers of 
        private education loans shall report, to the satisfaction of 
        the Secretary of the Treasury, the information necessary to 
        calculate the amount to be applied under subsection (a).
    (e) Memorandum of Understanding.--The Secretaries concerned shall 
enter into a memorandum of understanding to carry out this section.
    (f) Definitions.--In this section:
            (1) Covered loan.--The term ``covered loan'' means--
                    (A) a loan made, insured, or guaranteed under part 
                B of title IV of the Higher Education Act of 1965 (20 
                U.S.C. 1071 et seq.);
                    (B) a loan made under part D of title IV of the 
                Higher Education Act of 1965 (20 U.S.C. 1087a et seq.); 
                and
                    (C) a Federal Perkins Loan made pursuant to part E 
                of title IV of the Higher Education Act of 1965 (20 
                U.S.C. 1087aa et seq.).
            (2) COVID-19 emergency period.--For purposes of this Act, 
        the term ``COVID-19 emergency period'' means the period that 
        begins upon the date of the enactment of this Act and ends upon 
        the date of the termination by the Federal Emergency Management 
        Administration of the emergency declared on March 13, 2020, by 
        the President under the Robert T. Stafford Disaster Relief and 
        Emergency Assistance Act (42 U.S.C. 4121 et seq.) relating to 
        the Coronavirus Disease 2019 (COVID-19) pandemic.
            (3) Private education loan.--The term ``private education 
        loan'' has the meaning given the term in section 140 of the 
        Truth in Lending Act (15 U.S.C. 1650).
            (4) Qualified borrower.--The term ``qualified borrower'' 
        means a borrower of a covered loan or a private education loan.
            (5) Secretaries concerned.--The term ``Secretaries 
        concerned'' means--
                    (A) the Secretary of Education, with respect to 
                covered loans and borrowers of such covered loans; and
                    (B) the Secretary of the Treasury, with respect to 
                private education loans and borrowers of such private 
                education loans.

SEC. 5. INCOME SHARE AGREEMENTS.

    (a) In General.--An individual who entered into an income share 
agreement to pay for education expenses of the individual shall not be 
required to make payments under such income share agreement for the 
duration of the COVID-19 emergency period and the 6-month period 
immediately following.
    (b) COVID-19 Emergency Period.--In this section, the term ``COVID-
19 emergency period'' means the period that begins upon the date of the 
enactment of this Act and ends upon the date of the termination by the 
Federal Emergency Management Administration of the emergency declared 
on March 13, 2020, by the President under the Robert T. Stafford 
Disaster Relief and Emergency Assistance Act (42 U.S.C. 4121 et seq.) 
relating to the Coronavirus Disease 2019 (COVID-19) pandemic.

SEC. 6. 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 THE COVID-19 NATIONAL 
              EMERGENCY.

    ``Gross income shall not include any payment made on behalf of the 
taxpayer under section 493E(b)(1) of the Higher Education Act of 1965, 
section 140(h) of the Truth in Lending Act, or section 4 of the 
Emergency Relief for Student Borrowers Act of 2020.''.
    (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 the COVID-19 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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