II 115th CONGRESS 2d Session S. 3390 IN THE SENATE OF THE UNITED STATES August 27, 2018 Mr. Brown introduced the following bill; which was read twice and referred to the Committee on Health, Education, Labor, and Pensions A BILL To establish an Education Recoupment Trust Fund to recover misused elementary and secondary education funds for the benefit of the affected students.

1. Short title This Act may be cited as the Putting Students First Act . 2. Education Recoupment Trust Fund (a) Definitions In this section: (1) Eligible case The term eligible case means any administrative, criminal, or civil case— (A) in which the United States is a named party; and (B) related to the misuse of any qualifying money. (2) Local educational agency The term local educational agency has the meaning given that term in section 8101 of the Elementary and Secondary Education Act of 1965 ( 20 U.S.C. 7801 ). (3) Misuse The term misuse , when used with respect to qualifying money, means— (A) fraud, theft, or otherwise illegal or prohibited use of qualifying money; or (B) statements or actions used to fraudulently or otherwise illegally obtain qualifying money. (4) Qualifying money The term qualifying money means money distributed by the Department of Education for the purpose of elementary or secondary education, including such money distributed— (A) directly to any individual or entity; or (B) to a State educational agency, local educational agency, school, charter school network or system, charter school, charter or education management organization, or any other institution, office, department, or entity, which then distributed the money to another individual or entity. (5) Responsible party The term responsible party means any individual, institution, government body, official, or other entity that is a named party to an eligible case that— (A) is ordered by a court or administrative agency to pay a fine, fee, penalty, or judgment to the United States Government due to misuse of qualifying money; or (B) enters into a settlement agreement with the United States Government related to the misuse of qualifying money. (6) State educational agency The term State educational agency has the meaning given that term in section 8101 of the Elementary and Secondary Education Act of 1965 ( 20 U.S.C. 7801 ). (7) Trust Fund The term Trust Fund means the Education Recoupment Trust Fund established under subsection (b). (b) In general There is established in the Treasury of the United States a trust fund, to be known as the Education Recoupment Trust Fund , consisting of such amounts as are deposited in the Trust Fund under subsection (c) or any other provision of law. (c) Deposits (1) In general Notwithstanding any other provision of law, the Secretary of the Treasury shall deposit in the Trust Fund an amount equal to 100 percent of funds collected by the United States Government from any responsible party pursuant to any judgment or award in or settlement of any litigation, or fine or penalty imposed pursuant to any administrative action, relating to an eligible case, including money realized from the liquidation of any asset awarded to the United States Government in relation to an eligible case or settlement of litigation relating to an eligible case. (2) Multiple counts or claims If an eligible case involves multiple counts or claims, the Secretary of the Treasury shall deposit only the collected funds related to the counts or claims involving the misuse of qualifying money. (d) Distribution of Trust Fund The Secretary of the Treasury shall distribute any deposits made to the Trust Fund as follows: (1) In the case of funds deposited under subsection (c) related to the misuse of qualifying money by a responsible party that is a local educational agency, a school, a charter school network or system, a charter school, a charter or education management organization, or an official or employee of any such agency, school, system, or organization the funds shall be distributed from the Trust Fund to the State educational agency in the State in which the intended student beneficiaries of the qualifying money are located. (2) In the case of funds deposited under subsection (c) related to the misuse of qualifying money by a responsible party that is a State educational agency or an official or employee of a State educational agency, the funds shall be distributed from the Trust Fund to the Secretary of Education. (3) In any case not described in paragraph (1) or (2), the funds deposited under subsection (c) related to the misuse of qualifying money shall be distributed from the Trust Fund to the Secretary of Education. (e) Allocation of funds from the Trust Fund (1) State educational agencies (A) In General Subject to subparagraph (B), a State educational agency that receives funds in accordance with subsection (d)(1) shall allocate such funds to each local educational agency in the State in an amount that bears the same relationship to the total funds described in subsection (d)(1) for that State as the amount of funds under part A of title I of the Elementary and Secondary Education Act of 1965 ( 20 U.S.C. 6311 et seq.) that the local educational agency received for the most recent fiscal year for which data are available bears to the total amount of funds under that part for all local educational agencies in that State for that year. (B) Direct grants to schools Notwithstanding subparagraph (A), in the case of a local educational agency that continues to employ, or otherwise affiliate with, an individual who is a responsible party who has misused qualifying money, a State educational agency may— (i) directly distribute such funds to schools served by that local educational agency in an amount that bears the same relationship to the total funds that would be directed to that local educational agency under subparagraph (A) as the amount of funds under part A of title I of the Elementary and Secondary Education Act of 1965 ( 20 U.S.C. 6311 et seq.) that the school received for the most recent fiscal year for which data are available bears to the total amount of funds under that part for all schools served by that local educational agency for that year; or (ii) attach reasonable conditions to prevent the misuse of qualifying money. (2) Secretary of Education (A) In General The Secretary of Education shall allocate funds described in paragraphs (2) and (3) of subsection (d) directly to each local educational agency in the State in which the intended student beneficiaries of the qualifying money were located. (B) Amount of allocations The Secretary of Education shall allocate funds described in paragraphs (2) and (3) of subsection (d) to each local educational agency in the State in an amount that bears the same relationship to the total funds described in paragraphs (2) and (3) of subsection (d) for that State as the amount of funds under part A of title I of the Elementary and Secondary Education Act of 1965 ( 20 U.S.C. 6311 et seq.) that the local educational agency received for the most recent fiscal year for which data are available to the Secretary of Education bears to the total amount of funds under that part for all local educational agencies in that State for that year. (f) Use of funds Any funds allocated to a local educational agency under this section shall be distributed to schools and otherwise used in a manner consistent with part A of title I of the Elementary and Secondary Education Act of 1965 ( 20 U.S.C. 6311 et seq.). Any school receiving funds under this section shall use such funds in a manner consistent with such part.