[Congressional Bills 105th Congress]
[From the U.S. Government Publishing Office]
[S. 1882 Introduced in Senate (IS)]







105th CONGRESS
  2d Session
                                S. 1882

    To reauthorize the Higher Education Act of 1965, and for other 
                               purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             March 30, 1998

   Mr. Jeffords (for himself, Mr. Kennedy, Mr. Coats, and Mr. Dodd) 
introduced the following bill; which was read twice and referred to the 
                 Committee on Labor and Human Resources

_______________________________________________________________________

                                 A BILL


 
    To reauthorize the Higher Education Act of 1965, 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 ``Higher Education Amendments of 
1998''.

SEC. 2. REFERENCES.

    Except as otherwise expressly provided, whenever in this Act an 
amendment or repeal is expressed in terms of an amendment to, or repeal 
of, a section or other provision, the reference shall be considered to 
be made to a section or other provision of the Higher Education Act of 
1965 (20 U.S.C. 1001 et seq.).

                      TITLE I--GENERAL PROVISIONS

SEC. 101. GENERAL PROVISIONS.

    (a) Repeal; Transfer and Redesignation.--The Act (20 U.S.C. 1001 et 
seq.) is amended--
            (1) by repealing title I (20 U.S.C. 1001 et seq.);
            (2) by repealing sections 1203, 1206, 1211, and 1212 (20 
        U.S.C. 1143, 1145a, 1145e, and 1145f);
            (3) by striking the heading for title XII (20 U.S.C. 1141 
        et seq.);
            (4) by inserting before title III (20 U.S.C. 1051 et seq.) 
        the following:

                    ``TITLE I--GENERAL PROVISIONS'';

            (5) by transferring sections 1201, 1202, 1204 (as 
        renumbered by Public Law 90-575), 1204 (as added by Public Law 
        96-374), 1205, 1207, 1208, 1209, 1210, and 1213 (20 U.S.C. 
        1141, 1142, 1144, 1144a, 1145, 1145b, 1145c, 1145d, 1145d-1, 
        and 1145g) to follow the heading for title I (as inserted by 
        paragraph (4)); and
            (6) by redesignating sections 1201, 1202, 1204 (as 
        renumbered by Public Law 90-575), 1204 (as added by Public Law 
        96-374), 1205, 1207, 1208, 1209, 1210, and 1213 as sections 
        101, 102, 103, 104, 105, 106, 107, 108, 109, and 110, 
        respectively.

SEC. 102. FEDERAL CONTROL OF EDUCATION PROHIBITED.

    Section 103 (as redesignated by section 101(a)(6)) (20 U.S.C. 1144) 
is amended by striking ``(b)''.

SEC. 103. NATIONAL ADVISORY COMMITTEE ON INSTITUTIONAL QUALITY AND 
              INTEGRITY.

    Section 105 (as redesignated by section 101(a)(6)) (20 U.S.C. 1145) 
is amended--
            (1) by striking the last sentence of subsection (a);
            (2) by redesignating subsections (c) through (f) as 
        subsections (d) through (g), respectively;
            (3) by inserting after subsection (b) the following:
    ``(c) Public Notice.--The Secretary shall--
            ``(1) annually publish in the Federal Register a list 
        containing the name of each member of the Committee and the 
        date of the expiration of the term of office of the member; and
            ``(2) publicly solicit nominations for each vacant position 
        or expiring term of office on the Committee.'';
            (4) in subsection (d) (as redesignated by paragraph (2))--
                    (A) by striking paragraph (6); and
                    (B) by redesignating paragraphs (7) and (8) as 
                paragraphs (6) and (7), respectively; and
            (5) in subsection (g) (as redesignated by paragraph (2)), 
        by striking ``1998'' and inserting ``2004''.

SEC. 104. PRIOR RIGHTS AND OBLIGATIONS; RECOVERY OF PAYMENTS.

    Title I (20 U.S.C. 1001 et seq.) is amended by adding after section 
110 (as redesignated by section 101(a)(6)) the following:

``SEC. 111. PRIOR RIGHTS AND OBLIGATIONS.

    ``(a) Authorization of Appropriations.--
            ``(1) Pre-1987 parts c and d of title vii.--There are 
        authorized to be appropriated such sums as may be necessary for 
        fiscal year 1999 and for each of the 4 succeeding fiscal years 
        to pay obligations incurred prior to 1987 under parts C and D 
        of title VII, as such parts were in effect before the effective 
        date of the Higher Education Amendments of 1992.
            ``(2) Post-1992 and pre-1998 part c of title vii.--There 
        are authorized to be appropriated such sums as may be necessary 
for fiscal year 1999 and for each of the 4 succeeding fiscal years to 
pay obligations incurred prior to the date of enactment of the Higher 
Education Amendments of 1998 under part C of title VII, as such part 
was in effect during the period--
                    ``(A) after the effective date of the Higher 
                Education Amendments of 1992; and
                    ``(B) prior to the date of enactment of the Higher 
                Education Amendments of 1998.
    ``(b) Legal Responsibilities.--
            ``(1) Pre-1987 title vii.--All entities with continuing 
        obligations incurred under parts A, B, C, and D of title VII, 
        as such parts were in effect before the effective date of the 
        Higher Education Amendments of 1992, shall be subject to the 
        requirements of such part as in effect before the effective 
        date of the Higher Education Amendments of 1992.
            ``(2) Post-1992 and pre-1998 part c of title vii.--All 
        entities with continuing obligations incurred under part C of 
        title VII, as such part was in effect during the period--
                    ``(A) after the effective date of the Higher 
                Education Amendments of 1992; and
                    ``(B) prior to the date of enactment of the Higher 
                Education Amendments of 1998,
        shall be subject to the requirements of such part as such part 
        was in effect during such period.

``SEC. 112. RECOVERY OF PAYMENTS.

    ``(a) Public Benefit.--Congress declares that, if a facility 
constructed with the aid of a grant under part A of title VII as such 
part A was in effect prior to the date of enactment of the Higher 
Education Amendments of 1998, or part B of such title as such part B 
was in effect prior to the date of enactment of the Higher Education 
Amendments of 1992, is used as an academic facility for 20 years 
following completion of such construction, the public benefit accruing 
to the United States will equal in value the amount of the grant. The 
period of 20 years after completion of such construction shall 
therefore be deemed to be the period of Federal interest in such 
facility for the purposes of such title as so in effect.
    ``(b) Recovery Upon Cessation of Public Benefit.--If, within 20 
years after completion of construction of an academic facility which 
has been constructed, in part with a grant under part A of title VII as 
such part A was in effect prior to the date of enactment of the Higher 
Education Amendments of 1998, or part B of title VII as such part B was 
in effect prior to the date of enactment of the Higher Education 
Amendments of 1992--
            ``(1) the applicant under such parts as so in effect (or 
        the applicant's successor in title or possession) ceases or 
        fails to be a public or nonprofit institution, or
            ``(2) the facility ceases to be used as an academic 
        facility, or the facility is used as a facility excluded from 
        the term `academic facility' (as such term was defined under 
        title VII, as so in effect), unless the Secretary determines 
        that there is good cause for releasing the institution from its 
        obligation,
the United States shall be entitled to recover from such applicant (or 
successor) an amount which bears to the value of the facility at that 
time (or so much thereof as constituted an approved project or 
projects) the same ratio as the amount of Federal grant bore to the 
cost of the facility financed with the aid of such grant. The value 
shall be determined by agreement of the parties or by action brought in 
the United States district court for the district in which such 
facility is situated.
    ``(c) Prohibition on Use for Religion.--Notwithstanding the 
provisions of subsections (a) and (b), no project assisted with funds 
under title VII (as in effect prior to the date of enactment of the 
Higher Education Amendments of 1998) shall ever be used for religious 
worship or a sectarian activity or for a school or department of 
divinity.''.

SEC. 105. TECHNICAL AND CONFORMING AMENDMENTS.

    (a) Conforming Amendments Correcting References to Section 1201.--
            (1) Agriculture.--
                    (A) Student internship programs.--Section 922 of 
                the Federal Agriculture Improvement and Reform Act of 
                1996 (7 U.S.C. 2279c) is amended--
                            (i) in subsection (a)(1)(B)--
                                    (I) by striking ``1201'' and 
                                inserting ``101''; and
                                    (II) by striking ``(20 U.S.C. 
                                1141)''; and
                            (ii) in subsection (b)(1)--
                                    (I) by striking ``1201'' and 
                                inserting ``101''; and
                                    (II) by striking ``(20 U.S.C. 
                                1141)''.
                    (B) Agricultural sciences education.--Section 
                1417(h)(1)(A) of the National Agricultural Research, 
                Extension, and Teaching Policy Act of 1977 (7 U.S.C. 
3152(h)(1)(A)) is amended--
                            (i) by striking ``1201(a)'' and inserting 
                        ``101(a)''; and
                            (ii) by striking ``(20 U.S.C. 1141(a))''.
            (2) Armed forces.--
                    (A) Science and mathematics education improvement 
                program.--Section 2193(c)(1) of title 10, United States 
                Code, is amended--
                            (i) by striking ``1201(a)'' and inserting 
                        ``101(a)''; and
                            (ii) by striking ``(20 U.S.C. 1141(a))''.
                    (B) Support of science, mathematics, and 
                engineering education.--Section 2199(2) of title 10, 
                United States Code, is amended--
                            (i) by striking ``1201(a)'' and inserting 
                        ``101(a)''; and
                            (ii) by striking ``(20 U.S.C. 1141(a))''.
                    (C) Allowable costs under defense contracts.--
                Section 841(c)(2) of the National Defense Authorization 
                Act for fiscal year 1994 (10 U.S.C. 2324 note) is 
                amended--
                            (i) by striking ``1201(a)'' and inserting 
                        ``101(a)''; and
                            (ii) by striking ``(20 U.S.C. 1141(a))''.
                    (D) Environmental restoration institutional grants 
                for training dislocated defense workers and young 
                adults.--Section 1333(i)(3) of the National Defense 
                Authorization Act for fiscal year 1994 (10 U.S.C. 2701 
                note) is amended--
                            (i) by striking ``1201(a)'' and inserting 
                        ``101(a)''; and
                            (ii) by striking ``(20 U.S.C. 1141(a))''.
                    (E) Environmental education opportunities 
                program.--Section 1334(k)(3) of the National Defense 
                Authorization Act for fiscal year 1994 (10 U.S.C. 2701 
                note) is amended--
                            (i) by striking ``1201(a)'' and inserting 
                        ``101(a)''; and
                            (ii) by striking ``(20 U.S.C. 1141(a))''.
                    (F) Environmental scholarship and fellowship 
                programs.--Section 4451(b)(1) of the National Defense 
                Authorization Act for 1993 (10 U.S.C. 2701 note) is 
                amended--
                            (i) by striking ``1201(a)'' and inserting 
                        ``101(a)''; and
                            (ii) by striking ``(20 U.S.C. 1141(a))''.
            (3) Application of antitrust laws to award of need-based 
        educational aid.--Section 568(c)(3) of the Improving America's 
        Schools Act of 1994 (15 U.S.C. 1 note) is amended--
                    (A) by striking ``1201(a)'' and inserting 
                ``101(a)''; and
                    (B) by striking ``(20 U.S.C. 1141(a))''.
            (4) Restrictions on former officers, employees, and elected 
        officials of the executive and legislative branches.--Section 
        207(j)(2)(B) of title 18, United States Code, is amended by 
        striking ``1201(a)'' and inserting ``101(a)''.
            (5) Education.--
                    (A) Higher education amendments of 1992.--Section 
                1(c) of the Higher Education Amendments of 1992 (20 
                U.S.C. 1001 note) is amended by striking ``1201'' and 
                inserting ``101''.
                    (B) Part f definitions.--Section 481 of the Higher 
                Education Act of 1965 (20 U.S.C. 1088) is amended--
                            (i) in subsection (a)--
                                    (I) in the matter preceding 
                                paragraph (1)(A), by striking 
                                ``1201(a)'' and inserting ``101(a)'';
                                    (II) in paragraph (1)(C), by 
                                striking ``1201(a)'' and inserting 
                                ``101(a)'';
                                    (III) in the first sentence of the 
                                matter preceding clause (i) of 
                                paragraph (2)(A), by striking 
                                ``1201(a)'' and inserting ``101(a)''; 
                                and
                                    (IV) in the matter following 
                                paragraph (2)(B)(ii), by striking 
                                ``1201(a)'' and inserting ``101(a)'';
                            (ii) in subsection (b)--
                                    (I) in the first sentence--
                                            (aa) in paragraph (2), by 
                                        striking ``1201(a)'' and 
                                        inserting ``101(a)''; and
                                            (bb) in paragraph (3), by 
                                        striking ``1201(a)'' and 
                                        inserting ``101(a)''; and
                                    (II) in the second sentence, by 
                                striking ``1201(a)'' and inserting 
                                ``101(a)''; and
                            (iii) in subsection (c)--
                                    (I) in the first sentence, by 
                                striking ``1201(a)'' and inserting 
                                ``101(a)''; and
                                    (II) in the second sentence, by 
                                striking ``1201(a)'' and inserting 
                                ``101(a)''.
                    (C) Treatment of branches.--Section 498(j)(2) of 
                the Higher Education Act of 1965 (20 U.S.C. 
                1099c(j)(2)) is amended by striking ``1201(a)(2)'' and 
                inserting ``101(a)(2)''.
                    (D) Small state teaching initiative.--Section 
                591(d)(2) of the Higher Education Act of 1965 (20 
                U.S.C. 1115(d)(2)) is amended by striking ``1201(a)'' 
                and inserting ``101(a)''.
                    (E) International education programs.--Section 
                631(a)(8) of the Higher Education Act of 1965 (20 
                U.S.C. 1132(a)(8)) is amended by striking ``1201(a)'' 
                each place it appears and inserting ``101(a)''.
                    (F) Dwight d. eisenhower leadership program.--
                Section 1081(d) of the Higher Education Act of 1965 (20 
                U.S.C. 1135f(d)) is amended by striking ``1201'' and 
                inserting ``101''.
                    (G) Disclosure requirements.--Section 
                429(d)(2)(B)(ii) of the General Education Provisions 
                Act (20 U.S.C. 1228c(d)(2)(B)(ii)) is amended by 
                striking ``1201(a)'' and inserting ``101(a)''.
                    (H) Harry s. truman scholarships.--Section 3(4) of 
                the Harry S. Truman Memorial Scholarship Act (20 U.S.C. 
                2002(4)) is amended by striking ``1201(a)'' and 
                inserting ``101(a)''.
                    (I) Tech-prep education.--Section 347(2)(A) of the 
                Carl D. Perkins Vocational and Applied Technology 
                Education Act (20 U.S.C. 2394e(2)(A)) is amended by 
                striking ``1201(a)'' and inserting ``101(a)''.
                    (J) Education for economic security.--Section 3(6) 
                of the Education for Economic Security Act (20 U.S.C. 
                3902(6)) is amended by striking ``1201(a)'' and 
                inserting ``101(a)''.
                    (K) James madison memorial fellowships.--Section 
                815 of the James Madison Memorial Fellowship Act (20 
                U.S.C. 4514) is amended--
                            (i) in paragraph (3), by striking 
                        ``1201(a)'' and inserting ``101(a)''; and
                            (ii) in paragraph (4), by striking 
                        ``1201(d) of the Higher Education Act of 1965'' 
                        and inserting ``14101 of the Elementary and 
                        Secondary Education Act of 1965''.
                    (L) Barry goldwater scholarships.--Section 1403(4) 
                of the Barry Goldwater Scholarship and Excellence in 
                Education Act (20 U.S.C. 4702(4)) is amended--
                            (i) by striking ``1201(a)'' and inserting 
                        ``101(a)''; and
                            (ii) by striking ``(20 U.S.C. 1141(a))''.
                    (M) Morris k. udall scholarships.--Section 4(6) of 
                the Morris K. Udall Scholarship and Excellence in 
                National Environmental and Native American Public 
                Policy Act of 1992 (20 U.S.C. 5602(6)) is amended by 
                striking ``1201(a)'' and inserting ``101(a)''.
                    (N) Bilingual education, and language enhancement 
                and acquisition.--Section 7501(4) of the Elementary and 
                Secondary Education Act of 1965 (20 U.S.C. 7601(4)) is 
                amended by striking ``1201(a)'' and inserting 
                ``101(a)''.
                    (O) General definitions.--Section 14101(17) of the 
                Elementary and Secondary Education Act of 1965 (20 
                U.S.C. 8801(17)) is amended by striking ``1201(a)'' and 
                inserting ``101(a)''.
                    (P) National education statistics.--Section 
                402(c)(3) of the National Education Statistics Act of 
                1994 (20 U.S.C. 9001(c)(3)) is amended by striking 
                ``1201(a)'' and inserting ``101(a)''.
            (6) Foreign relations.--
                    (A) Environment and sustainable development 
                exchange program.--Section 240(d) of the Foreign 
                Relations Authorization Act, Fiscal Years 1994 and 1995 
                (22 U.S.C. 2452 note) is amended by striking 
                ``1201(a)'' and inserting ``101(a)''.
                    (B) Samantha smith memorial exchange program.--
                Section 112(a)(8) of the Mutual Educational and 
                Cultural Exchange Act of 1961 (22 U.S.C. 2460(a)(8)) is 
                amended--
                            (i) by striking ``1201(a)'' and inserting 
                        ``101(a)''; and
                            (ii) by striking ``(20 U.S.C. 1141(a))''.
                    (C) Soviet-eastern european training.--Section 
                803(1) of the Soviet-Eastern European Research and 
                Training Act of 1983 (22 U.S.C. 4502(1)) is amended by 
                striking ``1201(a)'' and inserting ``101(a)''.
                    (D) Developing country scholarships.--Section 
                603(d) of the Foreign Relations Authorization Act, 
                Fiscal Years 1986 and 1987 (22 U.S.C. 4703(d)) is 
                amended by striking ``1201(a)'' and inserting 
                ``101(a)''.
            (7) Indians.--
                    (A) Snyder act.--The last paragraph of section 410 
                of the Act entitled ``An Act authorizing appropriations 
                and expenditures for the administration of Indian 
                Affairs, and for other purposes'', approved November 2, 
                1921 (25 U.S.C. 13) (commonly known as the Snyder Act) 
                is amended by striking ``1201'' and inserting ``101''.
                    (B) Tribally controlled community college 
                assistance.--Section 2(a)(5) of the Tribally Controlled 
                Community College Assistance Act (25 U.S.C. 1801(a)(5)) 
                is amended by striking ``1201(a)'' and inserting 
                ``101(a)''.
                    (C) Construction of new facilities.--Section 
                113(b)(2) of the Tribally Controlled Community College 
                Assistance Act (25 U.S.C. 1813(b)(2)) is amended--
                            (i) by striking ``1201(a)'' and inserting 
                        ``101(a)''; and
                            (ii) by striking ``(20 U.S.C. 1141(a))''.
                    (D) American indian teacher training.--Section 
                1371(a)(1)(B) of the Higher Education Amendments of 
                1992 (25 U.S.C. 3371(a)(1)(B)) is amended by striking 
                ``1201(a)'' and inserting ``101(a)''.
            (8) Labor.--
                    (A) Rehabilitation definitions.--Section 7(32) of 
                the Rehabilitation Act of 1973 (29 U.S.C. 706(32)) is 
                amended--
                            (i) by striking ``1201(a)'' and inserting 
                        ``101(a)''; and
                            (ii) by striking ``(20 U.S.C. 1141(a))''.
                    (B) State plans.--Section 101(a)(7)(A)(iv)(II) of 
                the Rehabilitation Act of 1973 (29 U.S.C. 
                721(a)(7)(A)(iv)(II)) is amended--
                            (i) by striking ``1201(a)'' and inserting 
                        ``101(a)''; and
                            (ii) by striking ``(20 U.S.C. 1141(a))''.
                    (C) JTPA definitions.--Section 4(12) of the Job 
                Training Partnership Act (29 U.S.C. 1503(12)) is 
                amended by striking ``1201(a)'' and inserting 
                ``101(a)''.
                    (D) Tuition charges.--Section 141(d)(3)(B) of the 
                Job Training Partnership Act (29 U.S.C. 1551(d)(3)(B)) 
                is amended--
                            (i) by striking ``1201(a)'' and inserting 
                        ``101(a)''; and
                            (ii) by striking ``(20 U.S.C. 1141(a))''.
            (9) Surface mining control.--Section 701(32) of the Surface 
        Mining Control and Reclamation Act of 1977 (30 U.S.C. 1291(32)) 
        is amended by striking ``1201(a)'' and inserting ``101(a)''.
            (10) Pollution prevention.--Section 112(a)(1) of the 
        Federal Water Pollution Control Act (33 U.S.C. 1262(a)(1)) is 
        amended by striking ``1201'' and inserting ``101''.
            (11) Postal service.--Section 3626(b)(3) of title 39, 
        United States Code, is amended--
                    (A) by striking ``1201(a)'' and inserting 
                ``101(a)''; and
                    (B) by striking ``(20 U.S.C. 1141(a))''.
            (12) Block grants to states.--Section 404(h)(5)(A)(i) of 
        the Social Security Act (42 U.S.C. 604(h)(5)(A)(i)) is 
        amended--
                    (A) by striking ``1201(a)'' and inserting 
                ``101(a)''; and
                    (B) by striking ``(20 U.S.C. 1088(a)(1) or 
                1141(a))''.
            (13) Public health and welfare.--
                    (A) Scientific and technical education.--Section 
                3(g) of the Scientific and Advanced-Technology Act of 
                1992 (42 U.S.C. 1862i(g)) is amended--
                            (i) in paragraph (2)--
                                    (I) by striking ``1201(a)'' and 
                                inserting ``101(a)''; and
                                    (II) by striking ``(20 U.S.C. 
                                1141(a))''; and
                            (ii) in paragraph (3)--
                                    (I) by striking ``1201(a)'' and 
                                inserting ``101(a)''; and
                                    (II) by striking ``(20 U.S.C. 
                                1141(a))''.
                    (B) Older americans.--Section 102(32) of the Older 
                Americans Act of 1965 (42 U.S.C. 3002(32)) is amended--
                            (i) by striking ``1201(a)'' and inserting 
                        ``101(a)''; and
                            (ii) by striking ``(20 U.S.C. 1141(a))''.
                    (C) Justice system improvement.--Section 901(17) of 
                the Omnibus Crime Control and Safe Streets Act of 1968 
                (42 U.S.C. 3791(17)) is amended--
                            (i) by striking ``1201(a)'' and inserting 
                        ``101(a)''; and
                            (ii) by striking ``(20 U.S.C. 1141(a))''.
                    (D) Energy technology commercialization services 
                program.--Section 362(f)(5)(A) of the Energy Policy and 
                Conservation Act (42 U.S.C. 6322(f)(5)(A)) is amended--
                            (i) by striking ``1201(a)'' and inserting 
                        ``101(a)''; and
                            (ii) by striking ``(20 U.S.C. 1141(a))''.
                    (E) Environmental restoration and waste 
                management.--Section 3132(b)(1) of the National Defense 
                Authorization Act for Fiscal Years 1992 and 1993 (42 
                U.S.C. 7274e(b)(1)) is amended--
                            (i) by striking ``1201(a)'' and inserting 
                        ``101(a)''; and
                            (ii) by striking ``(20 U.S.C. 1141(a))''.
                    (F) Head start.--Section 649(c)(3) of the Head 
                Start Act (42 U.S.C. 9844(c)(3)) is amended--
                            (i) by striking ``1201(a)'' and inserting 
                        ``101(a)''; and
                            (ii) by striking ``(20 U.S.C. 1141(a))''.
                    (G) State dependent care development grants.--
                Section 670G(5) of the Child Care and Development Block 
                Grant Act of 1990 (42 U.S.C. 9877(5)) is amended by 
                striking ``1201(a)'' and inserting ``101(a)''.
                    (H) Instructional activities for low-income 
                youth.--The matter preceding subparagraph (A) of 
                section 682(b)(1) of the Community Services Block Grant 
                Act (42 U.S.C. 9910c(b)(1)) is amended by striking 
                ``1201(a)'' and inserting ``101(a)''.
                    (I) Drug abuse education.--Section 3601(7) of the 
                Anti-Drug Abuse Act of 1988 (42 U.S.C. 11851(7)) is 
                amended--
                            (i) by striking ``1201(a)'' and inserting 
                        ``101(a)''; and
                            (ii) by striking ``(20 U.S.C. 1141(a))''.
                    (J) National and community service.--Section 
                101(13) of the National and Community Service Act of 
                1990 (42 U.S.C. 12511(13)) is amended--
                            (i) by striking ``1201(a)'' and inserting 
                        ``101(a)''; and
                            (ii) by striking ``(20 U.S.C. 1141(a))''.
                    (K) Civilian community corps.--Section 166(6) of 
                the National and Community Service Act of 1990 (42 
                U.S.C. 12626(6)) is amended--
                            (i) by striking ``1201(a)'' and inserting 
                        ``101(a)''; and
                            (ii) by striking ``(20 U.S.C. 1141(a))''.
                    (L) Community schools youth services and 
                supervision grant program.--The definition of public 
                school in section 30401(b) of the Community Schools 
                Youth Services and Supervision Grant Program Act of 
                1994 (42 U.S.C. 13791(b)) is amended--
                            (i) by striking ``1201'' each place it 
                        appears and inserting ``101''; and
                            (ii) by striking ``(20 U.S.C. 1141(i))''.
                    (M) Police corps.--The definition of institution of 
                higher education in section 200103 of the Police Corps 
                Act (42 U.S.C. 14092) is amended--
                            (i) by striking ``1201(a)'' and inserting 
                        ``101(a)''; and
                            (ii) by striking ``(20 U.S.C. 1141(a))''.
                    (N) Law enforcement scholarship program.--The 
                definition of institution of higher education in 
                section 200202 of the Law Enforcement Scholarship and 
                Recruitment Act (42 U.S.C. 14111) is amended--
                            (i) by striking ``1201(a)'' and inserting 
                        ``101(a)''; and
                            (ii) by striking ``(20 U.S.C. 1141(a))''.
            (14) Telecommunications.--Section 223(h)(4) of the 
        Telecommunications Act of 1934 (47 U.S.C. 223(h)(4)) is 
        amended--
                    (A) by striking ``1201'' and inserting ``101''; and
                    (B) by striking ``(20 U.S.C. 1141)''.
            (15) War and national defense.--Section 808(3) of the David 
        L. Boren National Security Education Act of 1991 (50 U.S.C. 
        1908(3)) is amended--
                    (A) by striking ``1201(a)'' and inserting 
                ``101(a)''; and
                    (B) by striking ``(20 U.S.C. 1141(a))''.
    (b) Cross References.--The Act (20 U.S.C. 1001 et seq.) is 
amended--
            (1) in section 402A(c)(2) (20 U.S.C. 1070a-11(c)(2)), by 
        striking ``1210'' and inserting ``110'';
            (2) in section 481 (20 U.S.C. 1088)--
                    (A) in subsection (a)--
                            (i) in paragraph (1)--
                                    (I) in the matter preceding 
                                subparagraph (A), by striking 
                                ``1201(a)'' and inserting ``101(a)''; 
                                and
                                    (II) in subparagraph (C), by 
                                striking ``1201(a)'' and inserting 
                                ``101(a)''; and
                            (ii) in paragraph (2)--
                                    (I) in the matter preceding clause 
                                (i) of subparagraph (A), by striking 
                                ``1201(a)'' and inserting ``101(a)''; 
                                and
                                    (II) in the matter following clause 
                                (ii) of subparagraph (B), by striking 
                                ``1201(a)'' and inserting ``101(a)'';
                    (B) in subsection (b), by striking ``1201(a)'' each 
                place the term appears and inserting ``101(a)''; and
                    (C) in subsection (c), by striking ``1201(a)'' each 
                place the term appears and inserting ``101(a)'';
            (3) in section 485(f)(1)(I) (20 U.S.C. 1092(f)(1)(I)), by 
        striking ``1213'' and inserting ``111'';
            (4) in section 498(j)(2) (20 U.S.C. 1099c(j)(2)), by 
        striking ``1201(a)(2)'' and inserting ``101(a)(2)'';
            (5) in section 591(d)(2) (20 U.S.C. 1115(d)(2)), by 
        striking ``1201(a)'' and inserting ``101(a)'';
            (6) in section 631(a)(8) (20 U.S.C. 1132(a)(8))--
                    (A) by striking ``section 1201(a)'' each place the 
                term appears and inserting ``section 101(a)''; and
                    (B) by striking ``of 1201(a)'' and inserting ``of 
                section 101(a)''; and
            (7) in section 1081(d) (20 U.S.C. 1135f(d)), by striking 
        ``1201'' and inserting ``101(a)''.

                  TITLE II--IMPROVING TEACHER QUALITY

SEC. 201. IMPROVING TEACHER QUALITY.

    The Act (20 U.S.C. 1001) is amended by inserting after section 112 
(as added by section 104) the following:

                 ``TITLE II--IMPROVING TEACHER QUALITY

``SEC. 201. PURPOSES.

    ``The purpose of this title is to--
            ``(1) improve student achievement;
            ``(2) improve the quality of the current and future 
        teaching force by improving the preparation of prospective 
        teachers and enhancing professional development activities; and
            ``(3) hold institutions of higher education accountable for 
        preparing teachers who have the necessary teaching skills and 
        are highly competent in the academic content areas in which the 
        teachers plan to teach, including training in the effective 
        uses of technologies in the classroom.

                       ``PART A--TEACHER QUALITY

            ``Subpart 1--Teacher Quality Enhancement Grants

``SEC. 211. GRANTS AUTHORIZED.

    ``(a) In General.--The Secretary is authorized to award grants to 
States to enable the States to carry out the activities described in 
section 212. Each grant may be awarded for a period of not more than 5 
years.
    ``(b) State Designation.--
            ``(1) In general.--A State desiring a grant under this 
        subpart shall, consistent with State law, designate the chief 
        individual or entity in the State responsible for the State 
        supervision of education, to administer the activities assisted 
        under this subpart.
            ``(2) Consultation.--The individual or entity designated 
        under paragraph (1) shall consult with the Governor, State 
        board of education, or State educational agency, as 
        appropriate.
            ``(3) Construction.--Nothing in this subpart shall be 
        construed to negate or supersede the legal authority under 
        State law of any State agency, State entity, or State public 
        official over programs that are under the jurisdiction of the 
        agency, entity, or official.
    ``(c) Matching Requirement.--Each State receiving a grant under 
this subpart shall provide, from non-Federal sources, an amount equal 
to \1/2\ of the amount of the grant, in cash or in kind, to carry out 
the activities supported through the grant.

``SEC. 212. USE OF FUNDS.

    ``A State that receives a grant under this subpart shall use the 
grant funds to reform teacher preparation requirements, and to ensure 
that current and future teachers possess the necessary teaching skills 
and academic content knowledge in the subject areas in which the 
teachers are assigned to teach, by carrying out 1 or more of the 
following activities:
            ``(1) Reforms.--Implementing reforms that hold institutions 
        of higher education with teacher preparation programs 
        accountable for preparing teachers who are highly competent in 
        the academic content areas in which the teachers plan to teach, 
        which may include the use of rigorous subject matter competency 
        tests and the requirement that a teacher have an academic major 
        in the subject area, or related discipline, in which the 
        teacher plans to teach.
            ``(2) Certification or licensure requirements.--Reforming 
        teacher certification or licensure requirements to ensure that 
        new teachers have the necessary teaching skills and academic 
        content knowledge in the subject areas in which teachers are 
        assigned to teach.
            ``(3) Alternatives to traditional preparation for 
        teaching.--Providing prospective teachers alternatives to 
        traditional preparation for teaching through programs at 
        colleges of arts and sciences or at nonprofit organizations.
            ``(4) Alternative routes.--Funding programs that establish, 
        expand, or improve alternative routes to State certification 
        for highly qualified individuals from other occupations and 
        recent college graduates with records of academic distinction, 
        including support during the initial teaching experience.
            ``(5) Recruitment; pay; removal.--Developing and 
        implementing effective mechanisms to ensure that schools are 
        able to effectively recruit highly qualified teachers, to 
        financially reward those teachers and principals whose students 
        have made significant progress toward high academic 
        performance, such as through performance-based compensation 
        systems and access to ongoing professional development 
        opportunities for teachers and administrators, and to remove 
        teachers who are not qualified.
            ``(6) Innovative efforts.--Development and implementation 
        of innovative efforts aimed at reducing the shortage of highly 
        qualified teachers in high poverty urban and rural areas, that 
        may include the recruitment of highly qualified individuals 
        from other occupations through alternative certification 
        programs.
            ``(7) Social promotion.--Development and implementation of 
        efforts to address the problem of social promotion and to 
        prepare teachers to effectively address the issues raised by 
        ending the practice of social promotion.

``SEC. 213. COMPETITIVE AWARDS.

    ``(a) Annual Awards; Competitive Basis.--The Secretary shall award 
grants under this subpart annually and on a competitive basis.
    ``(b) Peer Review Panel.--The Secretary shall provide the 
applications submitted by States under section 214 to a peer review 
panel for evaluation. With respect to each application, the peer review 
panel shall initially recommend the application for funding or for 
disapproval.
    ``(c) Priority.--In recommending applications for funding to the 
Secretary, the panel shall give priority to applications from States 
that describe activities that--
            ``(1) include innovative reforms to hold institutions of 
        higher education with teacher preparation programs accountable 
        for preparing teachers who are highly competent in the academic 
        content areas in which the teachers plan to teach; and
            ``(2) involve the development of innovative efforts aimed 
        at reducing the shortage of highly qualified teachers in high 
        poverty urban and rural areas.

``SEC. 214. APPLICATIONS.

    ``(a) In General.--Each State desiring a grant under this subpart 
shall submit an application to the Secretary at such time, in such 
manner and accompanied by such information as the Secretary may 
require.
    ``(b) Content of Applications.--Such application shall include a 
description of how the State intends to use funds provided under this 
subpart.

           ``Subpart 2--Teacher Training Partnerships Grants

``SEC. 221. GRANTS AUTHORIZED.

    ``(a) In General.--The Secretary is authorized to award grants to 
teacher training partnerships to enable the partnerships to carry out 
the activities described in section 222. Each grant may be awarded for 
a period of not more than 5 years.
    ``(b) Teacher Training Partnerships.--For the purpose of this part 
the term `teacher training partnership' means a partnership that--
            ``(1) shall include a school of arts and sciences, a school 
        or program of education, a local educational agency, and a 
        kindergarten through grade 12 school; and
            ``(2) may include a State educational agency, a pre-
        kindergarten program, a nonprofit group, a business, or a 
        teacher organization.
    ``(c) Priority.--
            ``(1) In general.--In awarding grants under this subpart 
        the Secretary shall give priority to partnerships that--
                    ``(A) involve businesses; or
                    ``(B) include a high need local educational agency, 
                elementary school or secondary school.
            ``(2) High need.--A local educational agency, elementary 
        school or secondary school shall be considered high need for 
        purposes of paragraph (1)(B) if the agency or school serves an 
        area within a State in which there is--
                    ``(A) a large number of individuals from families 
                with incomes below the poverty line;
                    ``(B) a high percentage of teachers not teaching in 
                the content area in which the teachers were trained to 
                teach; or
                    ``(C) a high teacher turnover.
    ``(d) Consideration.--In awarding grants under this subpart the 
Secretary will take into consideration--
            ``(1) providing an equitable geographic distribution of the 
        grants throughout the United States; and
            ``(2) the proposed project's potential for creating 
        improvement and positive change.
    ``(e) Matching Funds.--Each partnership receiving a grant under 
this subpart shall provide, from sources other than this subpart, an 
amount equal to 25 percent of the grant in the first year, 35 percent 
in the second such year, and 50 percent in each succeeding such year, 
of the amount of the grant, in cash or in kind, to carry out the 
activities supported by the grant.
    ``(f) One-Time Award.--A partnership may receive a grant under this 
section only once.

``SEC. 222. USE OF FUNDS.

    ``(a) In General.--Grant funds under this part shall be used to--
            ``(1) coordinate with the activities of the Governor, State 
        board of education, and State educational agency, as 
        appropriate;
            ``(2) provide sustained and high quality preservice 
        clinical experiences including the mentoring of prospective 
        teachers by veteran teachers;
            ``(3) work with a school of arts and sciences to provide 
        increased academic study in a proposed teaching specialty area, 
        through activities such as--
                    ``(A) restructuring curriculum;
                    ``(B) changing core course requirements;
                    ``(C) increasing liberal arts focus;
                    ``(D) providing preparation for board 
                certification; and
                    ``(E) assessing and improving alternative 
                certification, including mentoring and induction 
                support;
            ``(4) substantially increasing interaction and 2-way 
        collaboration between--
                    ``(A) faculty at institutions of higher education; 
                and
                    ``(B) new and experienced teachers, principals, and 
                other administrators at elementary schools or secondary 
                schools;
            ``(5) prepare teachers to use technology effectively in the 
        classroom;
            ``(6) integrate reliable research-based teaching methods 
        into the curriculum;
            ``(7) broadly disseminate information on effective 
        practices used by the partnership; and
            ``(8) provide support, including preparation time, for 
        interaction between faculty at an institution of higher 
        education and classroom teachers.
    ``(b) Special Rule.--No individual member of a partnership shall 
retain more than 50 percent of the funds made available to the 
partnership under this subpart.

``SEC. 223. APPLICATIONS.

    ``Each teacher training partnership desiring a grant under this 
subpart shall submit an application to the Secretary at such time, in 
such manner, and accompanied by such information as the Secretary may 
require. Each such application shall--
            ``(1) describe the composition of the partnership and the 
        involvement of each partner in the development of the 
        application;
            ``(2) contain a needs assessment that includes an analysis 
        of the needs of all the partners with respect to teaching and 
        learning;
            ``(3) contain a resource assessment that includes--
                    ``(A) an analysis of resources available to the 
                partnership;
                    ``(B) a description of the intended use of the 
                grant funds;
                    ``(C) a description of how the partnership will 
                coordinate with other teacher training or professional 
                development programs, including Federal, State, local, 
                private, and other programs;
                    ``(D) a description of how the activities assisted 
                under this subpart are consistent with educational 
                reform activities that promote student achievement; and
                    ``(E) a description of the commitment of the 
                resources of the partnership to the activities assisted 
                under this subpart, including financial support, 
                faculty participation, and time commitments;
            ``(4) describe how the partnership will include the 
        participation of the schools, colleges, or departments of arts 
        and sciences within an institution of higher education to 
        ensure the integration of teaching techniques and content in 
        teaching preparation;
            ``(5) describe how the partnership will restructure and 
        improve teaching, teacher training, and development programs, 
        and how such systemic changes will contribute to increased 
        student achievement;
            ``(6) describe how the partnership will prepare teachers to 
        work with diverse student populations, including individuals 
        with disabilities and limited English proficient individuals;
            ``(7) describe how the partnership will prepare teachers to 
        use technology;
            ``(8) contain a dissemination plan regarding knowledge and 
        information with respect to effective teaching practices, and a 
        description of how such knowledge and information will be 
        implemented in elementary schools or secondary schools as well 
        as institutions of higher education;
            ``(9) describe the commitment of the partnership to 
        continue the activities assisted under this subpart without 
        grant funds provided under this subpart; and
            ``(10) describe how the partnership will involve and 
        include parents in the reform process.

                    ``Subpart 3--General Provisions

``SEC. 231. ACCOUNTABILITY AND EVALUATION.

    ``(a) Teacher Quality Enhancement Grants.--
            ``(1) Accountability report.--A State that receives a grant 
        under subpart 1 shall submit an annual accountability report to 
        the Secretary, the Committee on Labor and Human Resources of 
        the Senate, and the Committee on Education and the Workforce of 
        the House of Representatives. Such report shall include a 
        description of the degree to which the State, in using funds 
        provided under subpart 1, has made substantial progress in 
        meeting the following goals:
                    ``(A) Student achievement.--Increasing student 
                achievement for all students, as measured by increased 
                graduation rates, decreased dropout rates, or higher 
                scores on local, State or other assessments.
                    ``(B) Raising standards.--Raising the State 
                academic standards required to enter the teaching 
                profession, including, where appropriate, incentives to 
                incorporate the requirement of an academic major in the 
                subject, or related discipline, in which the teacher 
                plans to teach.
                    ``(C) Initial certification or licensure.--
                Increasing success in the passage rate for initial 
                State teacher certification or licensure, or increasing 
                numbers of highly qualified individuals being certified 
                or licensed as teachers through alternative programs.
                    ``(D) Core academic subjects.--Increasing the 
                percentage of classes taught in core academic subject 
                areas by teachers highly competent in those subject 
                areas.
                    ``(E) Decreasing shortages for professional 
                development.--Decreasing shortages of qualified 
                teachers in poor urban and rural areas.
                    ``(F) Increasing opportunities.--Increasing 
                opportunities for enhanced and ongoing professional 
                development that improves the academic content 
                knowledge of teachers in the subject areas in which the 
                teachers are certified to teach or in which the 
                teachers are working toward certification to teach.
                    ``(G) Technology integration.--Increasing the 
                number of teachers prepared to integrate technology in 
                the classroom.
            ``(2) Teacher qualifications provided to parent upon 
        request.--Any local educational agency that benefits from the 
        activities assisted under subpart 1 shall make available, upon 
        request and in an understandable and uniform format, to any 
        parent of a student attending any school served by the local 
        educational agency, information regarding the qualifications of 
        the student's classroom teacher with regard to the subject 
        matter in which the teacher provides instruction. The local 
        educational agency shall inform parents that the parents are 
        entitled to receive the information upon request.
    ``(b) Teacher Training Partnership Evaluation Plan.--Each teacher 
training partnership receiving a grant under subpart 2 shall establish 
an evaluation plan that includes strong performance objectives 
established in negotiation with the Secretary at the time of the grant 
award. The plan shall include objectives and measures for--
            ``(1) increased student achievement for all students as 
        measured by increased graduation rates, decreased dropout 
        rates, or higher scores on local, State, or other assessments 
        for a year compared to student achievement as determined by the 
        rates or scores, as the case may be, for the year prior to the 
        year for which a grant under this part is received;
            ``(2) increased teacher retention in the first 3 years of a 
        teacher's career;
            ``(3) increased success in the passage rate for initial 
        State certification or licensure of teachers;
            ``(4) increased number of academic courses taken in core 
        subject areas;
            ``(5) increased integration of technology in teacher 
        preparation and in classroom instruction;
            ``(6) restructuring or change of methodology courses to 
        reflect best practices learned from elementary schools, 
        secondary schools or other entities;
            ``(7) increased dissemination of information about 
        effective teaching strategies and practices; and
            ``(8) other effects of increased integration among members 
        of the partnership.

``SEC. 232. REVOCATION OF GRANT.

    ``Each State or teacher training partnership receiving a grant 
under this part shall report annually on progress toward meeting the 
purposes of this part, and the goals, objectives and measures described 
in section 231. If the Secretary, after consultation with the peer 
review panel described in section 213(b) determines that the State or 
partnership is not making substantial progress in meeting the purposes, 
goals, objectives and measures, as appropriate, by the end of the 
second year of the grant, the grant shall not be continued for the 
third year of the grant.

``SEC. 233. EVALUATION AND DISSEMINATION.

    ``The Secretary shall evaluate the activities funded under this 
part and report the Secretary's findings to the Committee on Labor and 
Human Resources of the Senate and the Committee on Education and the 
Workforce of the House of Representatives. The Secretary shall broadly 
disseminate successful practices developed by the States and teacher 
training partnerships under this part, and shall broadly disseminate 
information regarding such practices so developed that were found to be 
ineffective.

``SEC. 234. INTERNATIONAL STUDY AND REPORT.

    ``(a) Study.--The Secretary shall conduct a study through the 
National Center for Education Statistics regarding the ways teachers 
are trained and the extent to which teachers in the United States and 
other comparable countries are teaching in areas other than the 
teachers' field of study or expertise. The study will examine specific 
fields and will outline the nature and extent of the problem of out-of-
field teaching in the United States and in other countries that are 
considered comparable to the United States. The study shall include, at 
a minimum, all the countries that participated in the Third 
International Mathematics and Science Study (TIMSS).
    ``(b) Report.--The Secretary shall report to Congress regarding the 
results of the study described in subsection (a).

``SEC. 235. AUTHORIZATION OF APPROPRIATIONS.

    ``There are authorized to be appropriated to carry out this part 
$300,000,000 for fiscal year 1999 and such sums as necessary for each 
of the 4 succeeding fiscal years, of which--
            ``(1) 50 percent shall be available for each fiscal year to 
        carry out subpart 1; and
            ``(2) 50 percent shall be available for each fiscal year to 
        carry out subpart 2.

        ``PART B--RECRUITING NEW TEACHERS FOR UNDERSERVED AREAS

``SEC. 251. STATEMENT OF PURPOSE.

    ``It is the purpose of this part to--
            ``(1) provide scholarships and, as necessary, support 
        services for students with high potential to become effective 
        teachers, particularly minority students;
            ``(2) increase the quality and number of new teachers 
        nationally; and
            ``(3) increase the ability of schools in underserved areas 
        to recruit a qualified teaching staff.

``SEC. 252. DEFINITIONS.

    ``In this part--
            ``(1) Eligible partnership.--
                    ``(A) In general.--The term `eligible partnership' 
                means a partnership consisting of--
                            ``(i) an institution of higher education 
                        that awards baccalaureate degrees and prepares 
                        teachers for their initial entry into the 
                        teaching profession; and
                            ``(ii) one or more local educational 
                        agencies that serve underserved areas.
                    ``(B) Additional partners.--Such a partnership may 
                also include--
                            ``(i) 2-year institutions of higher 
                        education that operate teacher preparation 
                        programs and maintain articulation agreements, 
                        with the institutions of higher education that 
                        award baccalaureate degrees for the transfer of 
                        credits in teacher preparation;
                            ``(ii) State agencies that have 
                        responsibility for policies related to teacher 
                        preparation and teacher certification or 
                        licensure; and
                            ``(iii) other public and private, nonprofit 
                        agencies and organizations that serve, or are 
                        located in, communities served by the local 
                        educational agencies in the partnership, and 
                        that have an interest in teacher recruitment, 
                        preparation, and induction.
            ``(2) Support services.--The term `support services' 
        means--
                    ``(A) academic advice and counseling;
                    ``(B) tutorial services;
                    ``(C) mentoring; and
                    ``(D) child care and transportation, if funding for 
                those services cannot be arranged from other sources.
            ``(3) Underserved area.--The term `underserved area' 
        means--
                    ``(A) the area served by the 3 local educational 
                agencies in the State that have the highest numbers of 
                children, ages 5 through 17, from families below the 
                poverty level (based on data satisfactory to the 
                Secretary); and
                    ``(B) the area served by any other local 
                educational agency in which the percentage of such 
                children is at least 20 percent, or the number of such 
                children is at least 10,000.

``SEC. 253. GRANT AUTHORITY AND CONDITIONS.

    ``(a) Grants Authorized.--
            ``(1) Grants.--
                    ``(A) In general.--From amounts appropriated under 
                section 262 the Secretary shall award grants, on a 
                competitive basis, to eligible partnerships to enable 
                the eligible partnerships to pay the Federal share of 
                the cost of carrying out the activities described in 
                section 255.
                    ``(B) Duration.--Each grant awarded under 
                subparagraph (A) shall be awarded for a period not to 
                exceed 5 years.
            ``(2) Continuing eligibility; review of progress.--The 
        Secretary shall--
                    ``(A) continue to make grant payments for the 
                second and succeeding years of a grant awarded under 
                this part, only after determining that the eligible 
                partnership is making satisfactory progress in carrying 
                out the activities under the grant; and
                    ``(B) conduct an intensive review of the eligible 
                partnerships's progress under the grant, with the 
                assistance of outside experts, before making grant 
                payments for the fourth year of the grant.
            ``(3) Maximum number.--No eligible partnership may receive 
        more than 2 grants under this subsection.
    ``(b) Matching Requirement.--
            ``(1) Federal share.--The Federal share of the cost of 
        activities carried out under a grant made under subsection (a) 
        shall not exceed--
                    ``(A) 70 percent of the cost in the first year of 
                the grant;
                    ``(B) 60 percent in the second year;
                    ``(C) 60 percent in the third year;
                    ``(D) 50 percent in the fourth year; and
                    ``(E) 50 percent in the fifth year and any 
                succeeding year (including each year of the second 
                grant, if any).
            ``(2) Non-federal share.--The non-Federal share of 
        activities carried out with a grant under subsection (a) may be 
        provided in cash or in kind, fairly evaluated, and may be 
        obtained from any non-Federal public or private source.
    ``(c) Planning Grants.--
            ``(1) In general.--The Secretary may award planning grants 
        to eligible partnerships that are not ready to implement 
        programs under subsection (a).
            ``(2) Duration.--Each planning grant shall be for a period 
        of not more than 1 year, which shall be in addition to the 
        period of any grant under subsection (a).
            ``(3) Requirement.--Any recipient of a planning grant under 
        this subsection that wishes to receive a grant under subsection 
        (a)(1) shall separately apply for a grant under that 
        subsection.

``SEC. 254. GRANT APPLICATIONS.

    ``(a) Applications Required.--Any eligible partnership desiring to 
receive a grant under this part shall submit an application to the 
Secretary at such time, in such form, and containing such information 
as the Secretary may require.
    ``(b) Application Contents.--Each application for a grant under 
section 253(a) shall include--
            ``(1) a designation of the institution or agency, within 
        the eligible partnership, that will serve as the fiscal agent 
        for the grant;
            ``(2) information on the quality of the teacher preparation 
        program of the institution of higher education participating in 
        the eligible partnership and how the eligible partnership will 
        ensure, through improvements in the eligible partnership's 
        teacher preparation practices or other appropriate strategies, 
        that scholarship recipients will receive high-quality 
        preparation;
            ``(3) a description of the assessment the members of the 
        eligible partnership have undertaken--
                    ``(A) to determine--
                            ``(i) the most critical needs of the local 
                        educational agencies, particularly the needs of 
                        schools in high-poverty areas, for new teachers 
                        (which may include teachers in particular 
                        subject areas or at certain grade levels); and
                            ``(ii) how the project carried out under 
                        the grant will address those needs; and
                    ``(B) that reflects the input of all significant 
                entities in the community (including organizations 
                representing teachers and parents) that have an 
                interest in teacher recruitment, preparation, and 
                induction;
            ``(4) a description of the project the eligible partnership 
        will carry out with the grant, including information 
        regarding--
                    ``(A) the recruitment and outreach efforts the 
                eligible partnership will undertake to publicize the 
                availability of scholarships and other assistance under 
                the program;
                    ``(B)(i) the number and types of students that the 
                eligible partnership will serve under the program, 
                which may include education paraprofessionals seeking 
                to achieve full teacher certification or licensure; 
                teachers whom the partner local educational agencies 
                have hired under emergency certification or licensure 
                procedures; or former military personnel, mid-career 
                professionals, or AmeriCorps or Peace Corps volunteers, 
                who desire to enter teaching; and
                    ``(ii) the criteria that the eligible partnership 
                will use in selecting the students, including criteria 
                to determine whether individuals have the capacity to 
                benefit from the program, complete teacher 
                certification requirements, and become effective 
                teachers;
                    ``(C) the activities the eligible partnership will 
                carry out under the grant, including a description of, 
                and justification for, any support services the 
                institution of higher education participating in the 
                eligible partnership will offer to participating 
                students;
                    ``(D) the number and funding range of the 
                scholarships the institution will provide to students; 
                and
                    ``(E) the procedures the institution will establish 
                for entering into, and enforcing, agreements with 
                scholarship recipients regarding the recipients' 
                fulfillment of the service commitment described in 
                section 259;
            ``(5) a description of how the institution will use funds 
        provided under the grant only--
                    ``(A) to increase the number of students--
                            ``(i) with high potential to be effective 
                        teachers;
                            ``(ii) participating in the institution's 
                        teacher preparation programs; or
                            ``(iii) in the particular type or types of 
                        preparation programs that the grant will 
                        support; or
                    ``(B) to increase the number of graduates, who are 
                minority individuals, with high potential to be 
                effective teachers;
            ``(6) a description of the commitments, by the local 
        educational agencies participating in the partnership, to hire 
        qualified scholarship recipients in the schools served by the 
        agencies and in the subject areas or grade levels for which the 
        scholarship recipients will be trained, and a description of 
        the actions the participating institution of higher education, 
        the participating local educational agencies, and the other 
        partners will take to facilitate the successful transition of 
        the recipients into teaching; and
            ``(7) a description of the eligible partnership's plan for 
        institutionalizing the activities the partnership is carrying 
        out under this part, so that the activities will continue once 
        Federal funding ceases.

``SEC. 255. USES OF FUNDS.

    ``(a) In General.--Each eligible partnership receiving a grant 
under section 523(a) shall use the grant funds for the following:
            ``(1) Scholarships.--Scholarships to help students pay the 
        costs of tuition, room, board, and other expenses of completing 
        a teacher preparation program.
            ``(2) Support services.--Support services, if needed to 
        enable scholarship recipients to complete postsecondary 
        education programs.
            ``(3) Followup services.--Followup services provided to 
        former scholarship recipients during the recipients' first 3 
        years of teaching.
            ``(4) Payments.--Payments to partner local educational 
        agencies, if needed to enable the agencies to permit 
        paraprofessional staff to participate in teacher preparation 
        programs (such as the cost of release time for the staff).
            ``(5) Additional courses.--If appropriate, and if no other 
        funds are available for, paying the costs of additional courses 
        taken by former scholarship recipients during the recipients' 
        initial 3 years of teaching.
    ``(b) Planning Grants.--A recipient of a planning grant under 
section 253(c) shall use the grant funds for the costs of planning for 
the implementation of a grant under section 253(a).

``SEC. 256. SELECTION OF APPLICANTS.

    ``(a) Peer Review.--The Secretary, using a peer review process, 
shall select eligible partnerships to receive funding under this part 
on the basis of--
            ``(1) the quality of the teacher preparation program 
        offered by the institution participating in the partnership;
            ``(2) the quality of the program carried out under the 
        application; and
            ``(3) the capacity of the partnership to carry out the 
        grant successfully.
    ``(b) Criteria.--
            ``(1) In general.--In awarding grants under section 253(a), 
        the Secretary shall seek to ensure that--
                    ``(A) in the aggregate, eligible partnerships carry 
                out a variety of approaches to preparing new teachers; 
                and
                    ``(B) there is an equitable geographic distribution 
                of the grants.
            ``(2) Special consideration.--In addition to complying with 
        paragraph (1), the Secretary shall give special consideration 
        to--
                    ``(A) applications most likely to result in the 
                preparation of increased numbers of individuals with 
                high potential for effective teaching who are minority 
                individuals; and
                    ``(B) applications from partnerships that have as 
                members of the partnerships historically Black colleges 
                and universities, Hispanic-serving institutions, and 
                Tribal Colleges and Universities.
    ``(c) Second Five-Year Grants.--In selecting eligible partnerships 
to receive second year grant payments under this part, the Secretary 
shall give a preference to eligible partnerships whose projects have 
resulted in--
            ``(1) the placement and retention of a substantial number 
        of high-quality graduates in teaching positions in underserved, 
        high-poverty schools;
            ``(2) the adoption of effective programs that meet the 
        teacher preparation needs of high-poverty urban and rural 
        areas; and
            ``(3) effective partnerships with elementary schools and 
        secondary schools that are supporting improvements in student 
        achievement.

``SEC. 257. DURATION AND AMOUNT OF ASSISTANCE; RELATION TO OTHER 
              ASSISTANCE.

    ``(a) Duration of Assistance.--No individual may receive 
scholarship assistance under this part--
            ``(1) for more than 5 years of postsecondary education; and
            ``(2) unless that individual satisfies the requirements of 
        section 484(a)(5).
    ``(b) Amount of Assistance.--No individual may receive a 
scholarship awarded under this part that exceeds the cost of 
attendance, as defined in section 472, at the institution of higher 
education the individual is attending.
    ``(c) Relation to Other Assistance.--A scholarship awarded under 
this part--
            ``(1) shall not be reduced on the basis of the individual's 
        receipt of other forms of Federal student financial assistance; 
        and
            ``(2) shall be regarded as other financial assistance 
        available to the student, within the meaning of sections 471(3) 
        and 480(j)(1), in determining the student's eligibility for 
        grant, loan, or work assistance under title IV.

``SEC. 258. SCHOLARSHIP CONDITIONS.

    ``(a) In General.--A recipient of a scholarship under this part 
shall continue to receive the scholarship assistance only as long as 
the recipient is--
            ``(1) enrolled as a full-time student and pursuing a course 
        of study leading to teacher certification, unless the recipient 
        is working in a public school (as a paraprofessional, or as a 
        teacher under emergency credentials) while participating in the 
        program; and
            ``(2) maintaining satisfactory progress as determined by 
        the institution of higher education participating in the 
        partnership.
    ``(b) Special Rule.--Each eligible partnership shall modify the 
application of section 257(a)(1) and of subsection (a)(1) to the extent 
necessary to accommodate the rights of individuals with disabilities 
under section 504 of the Rehabilitation Act of 1973.

``SEC. 259. SERVICE REQUIREMENTS.

    ``(a) Requirement.--Each eligible partnership receiving a grant 
under this part shall enter into an agreement, with each student to 
whom the partnership awards a scholarship under this part, providing 
that a scholarship recipient who completes a teacher preparation 
program under this part shall, within 7 years of completing that 
program, teach full-time for at least 5 years in a high-poverty school 
in an underserved geographic area or repay the amount of the 
scholarship, under the terms and conditions established by the 
Secretary.
    ``(b) Regulations.--The Secretary shall prescribe regulations 
relating to the requirements of subsection (a), including any 
provisions for waiver of those requirements.

``SEC. 260. EVALUATION.

    ``The Secretary shall provide for an evaluation of the program 
carried out under this part, which shall asses such issues as--
            ``(1) whether institutions participating in the eligible 
        partnerships are successful in preparing scholarship recipients 
        to teach to high State and local standards;
            ``(2) whether scholarship recipients are successful in 
        completing teacher preparation programs, becoming fully 
        certified teachers, and obtaining teaching positions in 
        underserved areas, and whether the recipients continue teaching 
        in those areas over a period of years;
            ``(3) the national impact of the program in assisting local 
        educational agencies in underserved areas to recruit, prepare, 
        and retain diverse, high-quality teachers in the areas in which 
        the agencies have the greatest needs;
            ``(4) the long-term impact of the grants on teacher 
        preparation programs conducted by institutions of higher 
        education participating in the eligible partnership and on the 
        institutions' relationships with their partner local 
        educational agencies and other members of the partnership; and
            ``(5) the relative effectiveness of different approaches 
        for preparing new teachers to teach in underserved areas, 
        including their effectiveness in preparing new teachers to 
        teach to high content and performance standards.

``SEC. 261. NATIONAL ACTIVITIES.

    ``The Secretary may reserve not more than 5 percent of the funds 
appropriated for this part for any fiscal year for--
            ``(1) peer review of applications;
            ``(2) conducting the evaluation required under section 260; 
        and
            ``(3) technical assistance.

``SEC. 262. AUTHORIZATION OF APPROPRIATIONS.

    ``There are authorized to be appropriated to carry out this part 
$37,000,000 for fiscal year 1999 and such sums as may be necessary for 
each of the 4 succeeding fiscal years.''.

                      TITLE III--INSTITUTIONAL AID

SEC. 301. TRANSFERS AND REDESIGNATIONS.

    (a) In General.--Title III (20 U.S.C. 1051 et seq.) is amended--
            (1) by redesignating part D as part F;
            (2) by redesignating sections 351, 352, 353, 354, 356, 357, 
        358, and 360 (20 U.S.C. 1066, 1067, 1068, 1069, 1069b, 1069c, 
        1069d, and 1069f) as sections 391, 392, 393, 394, 395, 396, 
        397, and 398, respectively;
            (3) by transferring part B of title VII (20 U.S.C. 1132c et 
        seq.) to title III to follow part C of title III (20 U.S.C. 
        1065 et seq.), and redesignating such part B as part D;
            (4) by redesignating sections 721 through 728 (20 U.S.C. 
        1132c and 1132c-7) as sections 341 through 348, respectively;
            (5) by transferring subparts 1 and 3 of part B of title X 
        (20 U.S.C. 1135b et seq. and 1135d et seq.) to title III to 
        follow part D of title III (as redesignated by paragraph (3)), 
        and redesignating such subpart 3 as subpart 2;
            (6) by inserting after part D of title III (as redesignated 
        by paragraph (3)) the following:

           ``PART E--MINORITY SCIENCE IMPROVEMENT PROGRAM'';

            (7) by redesignating sections 1021 through 1024 (20 U.S.C. 
        1135b and 1135b-3), and sections 1041, 1042, 1043, 1044, 1046, 
        and 1047 (20 U.S.C. 1135d, 1135d-1, 1135d-2, 1135d-3, 1135d-5, 
        and 1135d-6) as sections 351 through 354, and sections 361, 
        362, 363, 364, 365, and 366, respectively; and
            (8) by repealing section 366 (as redesignated by paragraph 
        (7)) (20 U.S.C. 1135d-6).
    (b) Conforming Amendment.--Section 361 (as redesignated by 
subsection (a)(7)) (20 U.S.C. 1135d) is amended--
            (1) in paragraph (1), by inserting ``and'' after the 
        semicolon;
            (2) in paragraph (2), by striking ``; and'' and inserting a 
        period; and
            (3) by striking paragraph (3).
    (c) Cross References.--Title III (20 U.S.C. 1051 et seq.) is 
amended--
            (1) in section 311(b) (20 U.S.C. 1057(b)), by striking 
        ``360(a)(1)'' and inserting ``398(a)(1)'';
            (2) in section 312 (20 U.S.C. 1058)--
                    (A) in subsection (b)(1)(B), by striking ``352(b)'' 
                and inserting ``392(b)''; and
                    (B) in subsection (c)(2), by striking ``352(a)'' 
                and inserting ``392(a)'';
            (3) in section 313(b) (20 U.S.C. 1059(b)), by striking 
        ``354(a)(1)'' and inserting ``394(a)(1)'';
            (4) in section 342 (as redesignated by subsection (a)(4)) 
        (20 U.S.C. 1132c-1)--
                    (A) in paragraph (3), by striking ``723(b)'' and 
                inserting ``343(b)'';
                    (B) in paragraph (4), by striking ``723'' and 
                inserting ``343'';
                    (C) in the matter preceding subparagraph (A) of 
                paragraph (5), by striking ``724(b)'' and inserting 
                ``344(b)'';
                    (D) in paragraph (8), by striking ``725(1)'' and 
                inserting ``345(1)''; and
                    (E) in paragraph (9), by striking ``727'' and 
                inserting ``347'';
            (5) in section 343 (as redesignated by subsection (a)(4)) 
        (20 U.S.C. 1132c-2)--
                    (A) in subsection (a), by striking ``724'' and 
                inserting ``344''; and
                    (B) in subsection (b)--
                            (i) in the matter preceding paragraph (1), 
                        by striking ``725(1) and 726'' and inserting 
                        ``345(1) and 346'';
                            (ii) in paragraph (10), by striking ``724'' 
                        and inserting ``344''; and
                            (iii) in subsection (d), by striking 
                        ``723(c)(1)'' and inserting ``343(c)(1)'';
            (6) in section 345(2) (as redesignated by subsection 
        (a)(4)) (20 U.S.C. 1132c-4(2)), by striking ``723'' and 
        inserting ``343'';
            (7) in section 348 (as redesignated by subsection (a)(4)) 
        (20 U.S.C. 1132c-7), by striking ``725(1)'' and inserting 
        ``345(1)'';
            (8) in section 353(a) (as redesignated by subsection 
        (a)(7)) (20 U.S.C. 1135b-2(a))--
                    (A) in paragraph (1), by striking ``1046(6)'' and 
                inserting ``365(6)'';
                    (B) in paragraph (2), by striking ``1046(7)'' and 
                inserting ``365(7)'';
                    (C) in paragraph (3), by striking ``1046(8)'' and 
                inserting ``365(8)''; and
                    (D) in paragraph (4), by striking ``1046(9)'' and 
                inserting ``365(9)'';
            (9) in section 361(1) (as redesignated by subsection 
        (a)(7)) (20 U.S.C. 1135d(1)), by striking ``1046(3)'' and 
        inserting ``365(3)'';
            (10) in section 362(a) (as redesignated by subsection 
        (a)(7)) (20 U.S.C. 1135d-1(a))--
                    (A) in the matter preceding paragraph (1), by 
                striking ``1041'' and inserting ``361''; and
                    (B) in paragraph (1), by striking ``1021(b)'' and 
                inserting ``351(b)''; and
            (11) in section 391(b)(6) (as redesignated by subsection 
        (a)(2)), by striking ``357'' and inserting ``396''.

SEC. 302. FINDINGS.

    Section 301(a) (20 U.S.C. 1051(a)) is amended--
            (1) by redesignating paragraphs (3) through (7) as 
        paragraphs (4) through (8), respectively; and
            (2) by inserting after paragraph (2) the following:
            ``(3) in order to be competitive and provide a high-quality 
        education for all, institutions of higher education should 
        improve their technological capacity and make effective use of 
        technology;''.

SEC. 303. STRENGTHENING INSTITUTIONS.

    (a) Grants.--Section 311 (20 U.S.C. 1057) is amended--
            (1) in subsection (b)(3)(D), by inserting ``, including 
        high technology equipment,'' after ``equipment''; and
            (2) by adding at the end the following:
    ``(c) Endowment Fund.--
            ``(1) In general.--An eligible institution may use not more 
        than 20 percent of the grant funds provided under this part to 
        establish or increase an endowment fund at such institution.
            ``(2) Matching requirement.--In order to be eligible to use 
        grant funds in accordance with paragraph (1), the eligible 
        institution shall provide matching funds, in an amount equal to 
        the Federal funds used in accordance with paragraph (1), for 
        the establishment or increase of the endowment fund.
            ``(3) Comparability.--The provisions of part C, regarding 
        the establishment or increase of an endowment fund, that the 
        Secretary determines are not inconsistent with this subsection, 
        shall apply to funds used under paragraph (1).''.
    (b) Duration of Grant.--Section 313 (20 U.S.C. 1059) is amended by 
adding at the end the following:
    ``(d) Wait-Out-Period.--Each eligible institution that received a 
grant under this part for a 5-year period shall not be eligible to 
receive an additional grant under this part until 2 years after the 
date on which the 5-year grant period terminates.''.
    (c) Hispanic-Serving Institutions.--Section 316 (20 U.S.C. 1059c) 
is amended--
            (1) in subsection (b)(1), by amending subparagraph (C) to 
        read as follows:
                    ``(C) provides assurances that not less than 50 
                percent of the institution's Hispanic students are low-
                income individuals who are first generation college 
                students;'';
            (2) in subsection (c), by adding at the end the following:
            ``(3) Endowment fund.--
                    ``(A) In general.--A Hispanic-serving institution 
                may use not more than 20 percent of the grant funds 
                provided under this part to establish or increase an 
                endowment fund at the institution.
                    ``(B) Matching requirement.--In order to be 
                eligible to use grant funds in accordance with 
                subparagraph (A), the Hispanic-serving institution 
                shall provide matching funds, in an amount equal to the 
                Federal funds used in accordance with paragraph (1), 
                for the establishment or increase of the endowment 
                fund.
                    ``(C) Comparability.--The provisions of part C 
                regarding the establishment or increase of an endowment 
                fund, that the Secretary determines are not 
                inconsistent with this paragraph, shall apply to funds 
                used under subparagraph (A).''; and
            (3) in subsection (d)(3)--
                    (A) by inserting ``or community-based 
                organization'' after ``educational agency''; and
                    (B) by inserting ``or organization'' after ``such 
                agency''.

SEC. 304. STRENGTHENING HBCU'S.

    (a) Grants.--Section 323 (20 U.S.C. 1062) is amended--
            (1) by redesignating subsection (b) as subsection (c); and
            (2) by inserting after subsection (a) the following:
    ``(b) Endowment Fund.--
            ``(1) In general.--An institution may use not more than 20 
        percent of the grant funds provided under this part to 
        establish or increase an endowment fund at the institution.
            ``(2) Matching requirement.--In order to be eligible to use 
        grant funds in accordance with paragraph (1), the eligible 
        institution shall provide matching funds, in an amount equal to 
        the Federal funds used in accordance with paragraph (1), for 
        the establishment or increase of the endowment fund.
            ``(3) Comparability.--The provisions of part C regarding 
        the establishment or increase of an endowment fund, that the 
        Secretary determines are not inconsistent with this subsection, 
        shall apply to funds used under paragraph (1).''.
    (b) Professional or Graduate Institutions.--Section 326 (20 U.S.C. 
1063b) is amended--
            (1) in subsection (a), by adding at the end of paragraph 
        (2) the following: ``If a grant of less than $500,000 is made 
        under this section, matching funds provided from non-Federal 
        sources are not required. If a grant equal to or in excess of 
        $500,000 is made under this section, matching funds provided 
        from non-Federal sources are required only with respect to the 
        amount of the grant that exceeds $500,000.''; and
            (2) in subsection (e)(1)--
                    (A) in subparagraph (E), by inserting ``, and any 
                Tuskegee University qualified graduate program'' before 
                the semicolon;
                    (B) in subparagraph (F), by inserting ``, and any 
                Xavier University qualified graduate program'' before 
                the semicolon;
                    (C) in subparagraph (G), by inserting ``, and any 
                Southern University qualified graduate program'' before 
                the semicolon;
                    (D) in subparagraph (H), by inserting ``, and any 
                Texas Southern University qualified graduate program'' 
                before the semicolon;
                    (E) in subparagraph (I), by inserting ``, and any 
                Florida A&M University qualified graduate program'' 
                before the semicolon; and
                    (F) in subparagraph (J), by inserting ``, and any 
                North Carolina Central University qualified graduate 
                program'' before the semicolon.

SEC. 305. ENDOWMENT CHALLENGE GRANTS.

    Paragraph (2) of section 331(b) (20 U.S.C. 1065(b)) is amended by 
striking subparagraphs (B) and (C) and inserting the following:
    ``(B) The Secretary may make a grant under this part to an eligible 
institution in any fiscal year in which the amount appropriated to 
carry out this part is less than $15,000,000, if the institution--
            ``(i) applies for a grant in an amount not exceeding 
        $500,000; and
            ``(ii) has deposited in its endowment fund established 
        under this section an amount which is equal to \1/2\ of the 
        amount of such grant.
    ``(C) An eligible institution of higher education that is awarded a 
grant under subparagraph (B) shall not be eligible to receive an 
additional grant under subparagraph (B) until 10 years after the date 
on which the grant period terminates.''.

SEC. 306. HBCU CAPITAL FINANCING.

    (a) Definition.--Section 342(5) (as redesignated by section 
301(a)(4)) (20 U.S.C. 1132c-1(5)) is amended--
            (1) by redesignating subparagraphs (B), (C), and (D) as 
        subparagraphs (C), (F), and (G);
            (2) by inserting after subparagraph (A) the following:
                    ``(B) a facility for the administration of an 
                educational program, or a student center or student 
                union, except that not more than 5 percent of the loan 
                proceeds provided under this part may be used for the 
                facility, center or union if the facility, center or 
                union is owned, leased, managed, or operated by a 
                private business, that, in return for such use, makes a 
                payment to the eligible institution;'';
            (3) by inserting after subparagraph (C) (as redesignated by 
        paragraph (1)) the following:
                    ``(D) a maintenance, storage, or utility facility 
                that is essential to the operation of a facility, a 
                library, a dormitory, equipment, instrumentation, a 
                fixture, real property or an interest therein, 
                described in this paragraph;
                    ``(E) a facility designed to provide primarily 
                outpatient health care for students or faculty;''; and
            (4) in subparagraph (G) (as redesignated by paragraph (2)), 
        by striking ``(C)'' and inserting ``(F)''.
    (b) Full Faith and Credit.--Section 343 (as redesignated by section 
301(a)(4)) (20 U.S.C. 1132c-2) is amended by adding at the end the 
following:
    ``(e) Notwithstanding any other provision of law, the Secretary may 
sell a qualified bond guaranteed under this part to any party that 
offers terms that the Secretary determines are in the best interest of 
the eligible institution.''.

SEC. 307. MINORITY SCIENCE AND ENGINEERING IMPROVEMENT PROGRAM.

    Section 365(4) (as redesignated by section 301(a)(7)) (20 U.S.C. 
1135d-5(4)) is amended by inserting ``behavioral,'' after 
``physical,''.

SEC. 308. GENERAL PROVISIONS.

    (a) Applications.--Paragraph (1) of section 391(b) (as redesignated 
by section 301(a)(2)) (20 U.S.C. 1066(b)) is amended by inserting ``, D 
or E'' after ``part C''.
    (b) Application Review Process.--Section 393 (as redesignated by 
section 301(a)(2)) (20 U.S.C. 1068) is amended by adding at the end the 
following:
    ``(d) Exclusion.--The provisions of this section shall not apply to 
applications submitted under part D.''.
    (c) Waivers.--Paragraph (2) of section 395(b) (as redesignated by 
section 301(a)(2)) (20 U.S.C. 1069b(b)) is amended by striking ``title 
II, IV, VII, or VIII'' and inserting ``part D, title IV, or title 
VIII''.
    (d) Authorization of Appropriations.--Section 398(a) (as 
redesignated by section 301(a)(2)) (20 U.S.C. 1069f) is amended--
            (1) in paragraph (1)--
                    (A) in subparagraph (A), by striking ``1993'' and 
                inserting ``1999''; and
                    (B) in subparagraph (B)--
                            (i) in clause (i), by striking ``1993'' and 
                        inserting ``1999'';
                            (ii) by striking clause (ii); and
                            (iii) by striking ``(B)(i) There'' and 
                        inserting ``(B) There'';
            (2) in paragraph (2)--
                    (A) in subparagraph (A), by striking ``1993'' and 
                inserting ``1999''; and
                    (B) in subparagraph (B), by striking ``$20,000,000 
                for fiscal year 1993'' and inserting ``$30,000,000 for 
                fiscal year 1999'';
            (3) in paragraph (3), by striking ``$50,000,000 for fiscal 
        year 1993'' and inserting ``$10,000,000 for fiscal year 1999''; 
        and
            (4) by adding at the end the following:
            ``(4) Part d.--There are authorized to be appropriated to 
        carry out part D, $110,000 for fiscal year 1999, and such sums 
        as may be necessary for each of the 4 succeeding fiscal years.
            ``(5) Part e.--There are authorized to be appropriated to 
        carry out part E, $10,000,000 for fiscal year 1999, and such 
        sums as may be necessary for each of the 4 succeeding fiscal 
        years.''.

                      TITLE IV--STUDENT ASSISTANCE

  PART A--GRANTS TO STUDENTS IN ATTENDANCE AT INSTITUTIONS OF HIGHER 
                               EDUCATION

SEC. 411. REPEALS AND REDESIGNATIONS.

    Title IV (20 U.S.C. 1070 et seq.) is amended--
            (1) in part A (20 U.S.C. 1070 et seq.)--
                    (A) in subpart 2 (20 U.S.C. 1070a-11), by repealing 
                chapters 3 through 8 (20 U.S.C. 1070a-31 et seq. and 
                1070a-81 et seq.); and
                    (B) by repealing subpart 8 (20 U.S.C. 1070f); and
            (2) in part H (20 U.S.C. 1099a et seq.)--
                    (A) by repealing subpart 1 (20 U.S.C. 1099a et 
                seq.); and
                    (B) by redesignating subparts 2 and 3 (20 U.S.C. 
                1099b et seq. and 1099c et seq.) as subparts 1 and 2, 
                respectively.

SEC. 412. FEDERAL PELL GRANTS.

    (a) Amendment to Subpart Heading.--The heading for subpart 1 of 
part A of title IV (20 U.S.C. 1070a et seq.) is amended by striking 
``Basic Educational Opportunity Grants'' and inserting ``Federal Pell 
Grants''.
    (b) Federal Pell Grants.--Section 401 (20 U.S.C. 1070a) is 
amended--
            (1) in the section heading, by striking ``basic educational 
        opportunity grants'' and inserting ``federal pell grants'';
            (2) in subsection (a)(1)--
                    (A) in the first sentence, by striking ``shall, 
                during the period beginning July 1, 1972, and ending 
                September 30, 1998,'' and inserting ``, for each fiscal 
                year through fiscal year 2004, shall''; and
                    (B) in the second sentence, by inserting ``until 
                such time as the Secretary determines and publishes in 
                the Federal Register with an opportunity for comment, 
                an alternative payment system that provides payments to 
                institutions in an accurate and timely manner,'' after 
                ``pay eligible students'';
            (3) in subsection (b)--
                    (A) in paragraph (2)(A), by striking clauses (i) 
                through (v), and inserting the following:
                            ``(i) $5,000 for academic year 1999-2000;
                            ``(ii) $5,200 for academic year 2000-2001;
                            ``(iii) $5,400 for academic year 2001-2002;
                            ``(iv) $5,600 for academic year 2002-2003; 
                        and
                            ``(v) $5,800 for academic year 2003-
                        2004.'';
                    (B) by amending paragraph (3) to read as follows:
            ``(3) For any academic year for which an appropriation Act 
        provides a maximum basic grant in an amount in excess of 
        $2,400, the amount of a student's basic grant shall equal 
        $2,400 plus--
                    ``(A) one-half of the amount by which such maximum 
                basic grant exceeds $2,400; plus
                    ``(B) the lesser of--
                            ``(i) the remaining one-half of such 
                        excess; or
                            ``(ii) the sum of the student's tuition, 
                        fees, and if the student has dependent care 
                        expenses (as described in section 472(8) or 
                        disability-related expenses (as described in 
                        section 472(9)), an allowance determined by the 
                        institution for such expenses.''; and
                    (C) in paragraph (5), by striking ``$400, except'' 
                and all that follows through ``grant of $400'' and 
                insert ``$200''; and
            (4) in subsection (c)--
                    (A) by amending paragraph (1) to read as follows: 
                ``(1)(A) Except as provided in subparagraph (B), the 
                period during which a student may receive a basic grant 
                shall be the period, required for the completion of the 
                first undergraduate baccalaureate course of study 
                pursued by the student at the institution at which the 
                student is in attendance, that does not exceed 150 
                percent of the period normally required by a full-time 
                student (or the equivalent period, in the case of a 
                part-time student) to complete the course of study at 
                the institution, as determined by the institution.
                    ``(B) A student may receive basic grants under this 
                subpart for a period that exceeds the period described 
                in subparagraph (A) to the extent the institution in 
                which the student is enrolled determines necessary to 
                accommodate the rights of students with disabilities 
                under section 504 of the Rehabilitation Act of 1973.''; 
                and
                    (B) in paragraph (2)--
                            (i) by striking ``Nothing'' and inserting 
                        ``(A) Except as provided in subparagraph (B), 
                        nothing'';
                            (ii) by striking ``or, in the case'' and 
                        all that follows through ``or skills''; and
                            (iii) by adding at the end the following:
                    ``(B)(i) A student may receive a basic grant to 
                attend English language instruction that is a separate 
                course of instruction only if--
                            ``(I) students enrolled in such a course 
                        are required to take an independently 
                        administered standardized test of English 
                        language proficiency upon completion of the 
                        course; and
                            ``(II) not less than a minimum percentage 
                        of such students achieve a passing score on 
                        that test.
                    ``(ii) The Secretary shall promulgate regulations 
                that specify 1 or more standardized tests of English 
                proficiency, the minimum percentage of students who 
                must achieve a passing score on the tests, and such 
                other requirements as the Secretary determines are 
                necessary to implement clause (i).''.

SEC. 413. TRIO PROGRAMS.

    (a) Program Authority.--Section 402A (20 U.S.C. 1070a-11) is 
amended--
            (1) in subsection (b)(3)--
                    (A) in subparagraph (A), by striking ``$170,000 for 
                fiscal year 1993'' and inserting ``$190,000 for each 
                fiscal year'';
                    (B) in subparagraph (B), by striking ``$180,000 for 
                fiscal year 1994'' and inserting ``$200,000 for each 
                fiscal year''; and
                    (C) in subparagraph (C), by striking ``$190,000 for 
                fiscal year 1995'' and inserting ``$210,000 for each 
                fiscal year'';
            (2) in subsection (c)(6), by amending the last sentence to 
        read as follows: ``The Secretary shall permit a Director of a 
        program assisted under this chapter to also administer 1 or 
        more additional programs for disadvantaged students operated by 
        the sponsoring entity regardless of the funding source of such 
        additional program.''; and
            (3) in subsection (f), by striking ``$650,000,000 for 
        fiscal year 1993'' and inserting ``$700,000,000 for fiscal year 
        1999''.
    (b) Talent Search.--Section 402B(b)(5) (20 U.S.C. 1070a-12(b)(5)) 
is amended by inserting ``, or activities designed to acquaint 
individuals from disadvantaged backgrounds with careers in which the 
individuals are particularly underrepresented'' before the semicolon.
    (c) Upward Bound.--Section 402C (20 U.S.C. 1070a-13) is amended--
            (1) in subsection (b)--
                    (A) in paragraph (9), by striking ``and'' after the 
                semicolon;
                    (B) by redesignating paragraph (10) as paragraph 
                (11);
                    (C) by inserting after paragraph (9) the following:
            ``(10) work-study positions where youth participating in 
        the project are exposed to careers requiring a postsecondary 
        degree; and''; and
                    (D) in paragraph (11) (as redesignated by 
                subparagraph (B)), by striking ``(9)'' and inserting 
                ``(10)''; and
            (2) in subsection (e), by striking ``and not in excess of 
        $40 per month during the remaining period of the year.'' and 
        inserting ``except that youth participating in a work-study 
        position under subsection (b)(10) may be paid a stipend of $300 
        per month during June, July, and August. Youths participating 
        in a project proposed to be carried out under any application 
        may be paid stipends not in excess of $40 per month during the 
        remaining period of the year.''.
    (d) Student Support Services.--Paragraph (6) of section 402D(c) (20 
U.S.C. 1070a-14(c)(6)) is amended to read as follows:
            ``(6) consider, in addition to such other criteria as the 
        Secretary may prescribe, the institution's effort, and where 
        applicable past history, in--
                    ``(A) providing sufficient financial assistance to 
                meet the full financial need of each student at the 
                institution; and
                    ``(B) maintaining the loan burden of each such 
                student at a manageable level.''.
    (e) Evaluation and Dissemination.--Section 402H (20 U.S.C. 1070a-
18) is amended to read as follows:

``SEC. 402H. EVALUATIONS AND GRANTS FOR PROJECT IMPROVEMENT AND 
              DISSEMINATION PARTNERSHIP PROJECTS.

    ``(a) Evaluations.--
            ``(1) In general.--For the purpose of improving the 
        effectiveness of the programs and projects assisted under this 
        subpart, the Secretary may make grants to or enter into 
        contracts with institutions of higher education and other 
        public and private institutions and organizations to evaluate 
        the effectiveness of the programs and projects assisted under 
        this subpart.
            ``(2) Practices.--The evaluations described in paragraph 
        (1) shall identify institutional, community, and program or 
        project practices that are particularly effective in enhancing 
        the access of low-income individuals and first-generation 
        college students to postsecondary education, the preparation of 
        the individuals and students for postsecondary education, and 
        the success of the individuals and students in postsecondary 
        education.
    ``(b) Grants.--The Secretary may award grants to institutions of 
higher education or other private and public institutions and 
organizations, that are carrying out a program or project assisted 
under this subpart prior to the date of enactment of the Higher 
Education Amendments of 1998, to enable the institutions and 
organizations to expand and leverage the success of such programs or 
projects by working in partnership with other institutions, community-
based organizations, or combinations of such institutions and 
organizations, that are not receiving assistance under this subpart and 
are serving low-income students and first generation college students, 
in order to--
            ``(1) disseminate and replicate best practices of programs 
        or projects assisted under this subpart; and
            ``(2) provide technical assistance regarding programs and 
        projects assisted under this subpart.
    ``(c) Results.--In order to improve overall program or project 
effectiveness, the results of evaluations and grants described in this 
section shall be disseminated by the Secretary to similar programs or 
projects assisted under this subpart, as well as other individuals 
concerned with postsecondary access for and retention of low-income 
individuals and first-generation college students.''.

SEC. 414. NATIONAL EARLY INTERVENTION SCHOLARSHIP AND PARTNERSHIP 
              PROGRAM.

    Section 404G (20 U.S.C. 1070a-27) is amended by striking ``1993'' 
and inserting ``1999''.

SEC. 415. FEDERAL SUPPLEMENTAL EDUCATIONAL OPPORTUNITY GRANTS.

    (a) Authorization of Appropriations.--Section 413A(b) (20 U.S.C. 
1070b) is amended by striking ``$675,000,000 for fiscal year 1993'' and 
inserting ``$700,000,000 for fiscal year 1999''.
    (b) Use of Funds for Less-Than-Full-Time Students.--Subsection (d) 
of section 413C (20 U.S.C. 1070b-2) is amended to read as follows:
    ``(d) Use of Funds for Less-Than-Full-Time Students.--If the 
institution's allocation under this subpart is directly or indirectly 
based in part on the financial need demonstrated by students who are 
independent students or attending the institution on less than a full-
time basis, a reasonable proportion of the allocation shall be made 
available to such students.''.
    (c) Carryover, Carryback, and Reallocation.--Subpart 3 of part A of 
title IV (20 U.S.C. 1070b et seq.) is amended by adding at the end the 
following:

``SEC. 413E. CARRYOVER, CARRYBACK, AND REALLOCATION.

    ``(a) Carryover Authority.--Of the sums made available to an 
eligible institution under this subpart for a fiscal year, not more 
than 10 percent may, at the discretion of the institution, remain 
available for expenditure during the succeeding fiscal year to carry 
out the program under this subpart.
    ``(b) Carryback Authority.--Of the sums made available to an 
eligible institution under this subpart for a fiscal year, not more 
than 10 percent may, at the discretion of the institution, be used by 
the institution for expenditure for the fiscal year preceding the 
fiscal year for which the sums were appropriated.
    ``(c) Reallocation.--Any of the sums made available to an eligible 
institution under this subpart for a fiscal year that are not needed by 
the institution to award supplemental grants during that fiscal year, 
that the institution does not wish to use during the succeeding fiscal 
year as authorized in subsection (a), and that the institution does not 
wish to use for the preceding fiscal year as authorized in subsection 
(b), shall be made available to the Secretary for reallocation under 
section 413D(e) until the end of the second fiscal year after the 
fiscal year for which such sums were appropriated.''.

SEC. 416. LEVERAGING EDUCATIONAL ASSISTANCE PARTNERSHIP PROGRAM.

    (a) Authorization of Appropriations.--Section 415A(b) (20 U.S.C. 
1070c(b)) is amended--
            (1) in paragraph (1), by striking ``1993'' and inserting 
        ``1999'';
            (2) by redesignating paragraph (2) as paragraph (3); and
            (3) by inserting after paragraph (1) the following:
            ``(2) Reservation.--For any fiscal year for which the 
        amount appropriated under paragraph (1) exceeds $35,000,000, 
        the excess shall be available to carry out section 415E.''.
    (b) Special Leveraging Educational Assistance Partnership 
Program.--Subpart 4 of part A of title IV (20 U.S.C. 1070c et seq.) is 
amended--
            (1) by redesignating section 415E as 415F;
            (2) by inserting after section 415D the following:

``SEC. 415E. SPECIAL LEVERAGING EDUCATIONAL ASSISTANCE PARTNERSHIP 
              PROGRAM.

    ``(a) In General.--From amounts reserved under section 415A(b)(2) 
for each fiscal year, the Secretary shall--
            ``(1) make allotments among States in the same manner as 
        the Secretary makes allotments among States under section 415B; 
        and
            ``(2) award grants to States, from allotments under 
        paragraph (1), to enable the States to pay the Federal share of 
        the cost of the authorized activities described in subsection 
        (c).
    ``(b) Applicability Rule.--The provisions of this subpart which are 
not inconsistent with this section shall apply to the program 
authorized by this section.
    ``(c) Authorized Activities.--Each State receiving a grant under 
this section may use the grant funds for--
            ``(1) increasing the dollar amount of grants awarded under 
        section 415B to eligible students who demonstrate financial 
        need;
            ``(2) carrying out transition programs from secondary 
        school to postsecondary education for eligible students who 
        demonstrate financial need;
            ``(3) making funds available for community service work-
        study activities for eligible students who demonstrate 
        financial need;
            ``(4) creating a postsecondary scholarship program for 
        eligible students who demonstrate financial need and wish to 
        enter teaching;
            ``(5) creating a scholarship program for eligible students 
        who demonstrate financial need and wish to enter a program of 
        study leading to a degree in mathematics, computer science, or 
        engineering;
            ``(6) carrying out early intervention programs, mentoring 
        programs, and career education programs for eligible students 
        who demonstrate financial need; and
            ``(7) awarding merit or academic scholarships to eligible 
        students who demonstrate financial need.
    ``(d) Maintenance of Effort Requirement.--Each State receiving a 
grant under this section for a fiscal year shall provide the Secretary 
an assurance that the aggregate amount expended per student or the 
aggregate expenditures by the State, from funds derived from non-
Federal sources, for the authorized activities described in subsection 
(c) for the preceding fiscal year were not less than the amount 
expended per student or the aggregate expenditures by the State for the 
activities for the second preceding fiscal year.
    ``(e) Federal Share.--The Federal share of the cost of the 
authorized activities described in subsection (c) for any fiscal year 
shall be 33\1/3\ percent.''; and
            (3) by adding at the end the following:

``SEC. 415G. FEDERAL-STATE RELATIONSHIPS; STATE AGREEMENTS.

    ``(a) In General.--Any State that desires to receive assistance 
under this subpart shall enter into an agreement with the Secretary 
pursuant to subsection (b) setting forth the terms and conditions for 
the relationship between the Federal Government and that State for the 
purposes set forth under this subpart.
    ``(b) Contents.--
            ``(1) In general.--Such agreement shall consist of 
        assurances by the State, including a description of the means 
        to be used by the State to fulfill the assurances, that--
                    ``(A) the State will provide for such methods of 
                administration as are necessary for the proper and 
                efficient administration of the program under this 
                subpart in keeping with the purposes set forth under 
                this subpart;
                    ``(B) the State will provide for such fiscal 
                control and fund accounting procedures as may be 
                necessary to ensure proper disbursement of, and 
                accounting for, Federal funds paid to the State under 
                this subpart;
                    ``(C) the State will follow policies and practices 
                of administration that will ensure that non-Federal 
                funds will not be supplanted by Federal funds, and that 
                equitable and appropriate criteria will be used in 
                evaluation of applications or proposals for grants 
                under this subpart; and
                    ``(D) the State has a comprehensive planning or 
                policy formulation process that--
                            ``(i) considers the relation between State 
                        administration of the program under this 
                        subpart, and administration of similar State 
                        programs or processes;
                            ``(ii) encourages State policies designed 
                        to consider effects on declining enrollments on 
                        all sectors of postsecondary education in the 
                        State;
                            ``(iii) considers the postsecondary 
                        education needs of unserved and underserved 
                        individuals within the State, including 
                        individuals beyond the traditional college age;
                            ``(iv) considers the resources of 
                        institutions, organizations, or agencies (both 
                        public and private) within the State capable of 
                        providing postsecondary educational 
                        opportunities in the State; and
                            ``(v) provides for direct, equitable, and 
                        active participation in the comprehensive 
                        planning or policy formulation process or 
                        processes of representatives of institutions of 
                        higher education (including community colleges, 
                        proprietary institutions, and independent 
                        colleges and universities), students, other 
                        providers of postsecondary education services, 
                        and the general public in the State.
            ``(2) Special rule.--Participation under paragraph 
        (1)(D)(v) shall, consistent with State law, be achieved through 
        membership on State planning commissions, State advisory 
        councils, or other State entities established by the State to 
conduct federally assisted comprehensive planning or policy 
formulation.
    ``(c) Special Rule.--The information and assurances provided by a 
State in accordance with subparagraphs (A), (B), and (C) of subsection 
(b)(1), and regulations issued by the Secretary related directly to 
such assurances, shall be satisfactory for the purposes of, and shall 
be considered in lieu of, any comparable requirements for information 
and assurances in any program under this subpart.
    ``(d) Agreement Duration; Compliance.--
            ``(1) Agreement duration.--An agreement of a State shall 
        remain in effect subject to modification as changes in 
        information or circumstances require.
            ``(2) Compliance.--Whenever the Secretary, after reasonable 
        notice and opportunity for a hearing has been given to the 
        State, finds that there is a failure to comply substantially 
        with the assurances required in subparagraph (A), (B), or (C) 
        of subsection (b)(1), the Secretary shall notify the State that 
        the State is no longer eligible to participate in the program 
        under this subpart until the Secretary is satisfied that there 
        is no longer any such failure to comply.
    ``(e) Special Rules.--
            ``(1) Entities entering into agreements.--For the purpose 
        of this section, the selection of the State entity or entities 
        authorized to act on behalf of the State for the purpose of 
        entering into an agreement with the Secretary shall be in 
        accordance with the State law of each individual State with 
        respect to the authority to make legal agreements between the 
        State and the Federal Government.
            ``(2) Construction.--
                    ``(A) State structure.--Nothing in this section 
                shall be construed to authorize the Secretary to 
                require any State to adopt, as a condition for entering 
                into an agreement, or for participation in a program 
                under this subpart, a specific State organizational 
                structure for achieving participation in the planning, 
                or administration of programs, or for statewide 
                planning, coordination, governing, regulating, or 
                administering of postsecondary education agencies, 
                institutions, or programs in the State.
                    ``(B) State authority.--Nothing in this section 
                shall be construed as a limitation on the authority of 
                any State to adopt a State organizational structure for 
                postsecondary education agencies, institutions, or 
                programs that is appropriate to the needs, traditions, 
                and circumstances of that State, or as a limitation on 
                the authority of a State entering into an agreement 
                pursuant to this section to modify the State 
                organizational structure at any time subsequent to 
                entering into such an agreement.''.
    (c) Technical and Conforming Amendments.--
            (1) Purpose.--Subsection (a) of section 415A (20 U.S.C. 
        1070c(a)) is amended to read as follows:
    ``(a) Purpose of Subpart.--It is the purpose of this subpart to 
make incentive grants available to States to assist States in--
            ``(1) providing grants to--
                    ``(A) eligible students attending institutions of 
                higher education or participating in programs of study 
                abroad that are approved for credit by institutions of 
                higher education at which such students are enrolled; 
                and
                    ``(B) eligible students for campus-based community 
                service work-study; and
            ``(2) carrying out the activities described in section 
        415F.''.
            (2) Allotment.--Section 415B(a)(1) (20 U.S.C. 1070c-
        1(a)(1)) is amended by inserting ``and not reserved under 
        section 415A(b)(2)'' after ``415A(b)(1)''.

SEC. 417. HEP AND CAMP.

    Section 418A(g) (20 U.S.C. 1070d-2(g)) is amended--
            (1) in paragraph (1), by striking ``$15,000,000 for fiscal 
        year 1993'' and inserting ``$25,000,000 for fiscal year 1999''; 
        and
            (2) in paragraph (2), by striking ``$5,000,000 for fiscal 
        year 1993'' and inserting ``$10,000,000 for fiscal year 1999''.

SEC. 418. ROBERT C. BYRD HONORS SCHOLARSHIP PROGRAM.

    Section 419K (20 U.S.C. 1070d-41) is amended by striking 
``$10,000,000 for fiscal year 1993'' and inserting ``$45,000,000 for 
fiscal year 1999''.

SEC. 419. CHILD CARE ACCESS MEANS PARENTS IN SCHOOL.

    Part A of title IV (20 U.S.C. 1070 et seq.) is amended by inserting 
after subpart 6 (20 U.S.C. 1070d-31 et seq.) the following:

         ``Subpart 7--Child Care Access Means Parents in School

``SEC. 419N. CHILD CARE ACCESS MEANS PARENTS IN SCHOOL.

    ``(a) Purpose.--The purpose of this section is to support the 
participation of low-income parents in postsecondary education through 
the provision of campus-based child care services.
    ``(b) Program Authorized.--
            ``(1) Authority.--The Secretary may award grants to 
        institutions of higher education to assist the institutions in 
        providing campus-based child care services to low-income 
        students.
            ``(2) Amount of grants.--
                    ``(A) In general.--The amount of a grant awarded to 
                an institution of higher education under this section 
                for a fiscal year shall not exceed 1 percent of the 
                total amount of all Federal Pell Grant funds awarded to 
                students enrolled at the institution of higher 
                education for the preceding fiscal year.
                    ``(B) Minimum.--A grant under this section shall be 
                awarded in an amount that is not less than $10,000.
            ``(3) Duration; renewal; and payments.--
                    ``(A) Duration.--The Secretary shall award a grant 
                under this section for a period of 3 years.
                    ``(B) Renewal.--A grant under this section may be 
                renewed for a period of 3 years.
                    ``(C) Payments.--Subject to subsection (d)(2), the 
                Secretary shall make annual grant payments under this 
                section.
            ``(4) Eligible institutions.--An institution of higher 
        education shall be eligible to receive a grant under this 
        section for a fiscal year if the total amount of all Federal 
        Pell Grant funds awarded to students enrolled at the 
        institution of higher education for the preceding fiscal year 
        equals or exceeds $350,000.
            ``(5) Use of funds.--Grant funds under this section shall 
        be used by an institution of higher education to support or 
        establish a campus-based child care program serving the needs 
        of low-income students enrolled at the institution of higher 
        education.
            ``(6) Construction.--Nothing in this section shall be 
        construed to prohibit an institution of higher education that 
        receives grant funds under this section from serving the child 
        care needs of the community served by the institution.
            ``(7) Definition of low-income student.--For the purpose of 
        this section, the term ``low-income student'' means a student 
        who is eligible to receive a Federal Pell Grant for the fiscal 
        year for which the determination is made.
    ``(c) Applications.--An institution of higher education desiring a 
grant under this section shall submit an application to the Secretary 
at such time, in such manner, and accompanied by such information as 
the Secretary may require. Each application shall--
            ``(1) demonstrate that the institution is an eligible 
        institution described in subsection (b)(4);
            ``(2) specify the amount of funds requested;
            ``(3) demonstrate the need of low-income students at the 
        institution for campus-based child care services by including 
        in the application student demographics and other relevant 
        data;
            ``(4) contain a description of the activities to be 
        assisted, including whether the grant funds will support an 
        existing child care program or a new child care program;
            ``(5) identify the resources the institution will draw upon 
        to support the child care program and the participation of low-
        income students in the program, such as accessing social 
        services funding, using student activity fees to help pay the 
        costs of child care, using resources obtained by meeting the 
        needs of parents who are not low-income students, and accessing 
        foundation, corporate or other institutional support, and 
        demonstrate that the use of the resources will not result in 
        increases in student tuition;
            ``(6) contain an assurance that the institution will meet 
        the child care needs of low-income students through the 
        provision of services, or through a contract for the provision 
        of services;
            ``(7) in the case of an institution seeking assistance for 
        a new child care program--
                    ``(A) provide a timeline, covering the period from 
                receipt of the grant through the provision of the child 
                care services, delineating the specific steps the 
                institution will take to achieve the goal of providing 
                low-income students with child care services;
                    ``(B) specify any measures the institution will 
                take to assist low-income students with child care 
                during the period before the institution provides child 
                care services; and
                    ``(C) include a plan for identifying resources 
                needed for the child care services, including space in 
                which to provide child care services, and technical 
                assistance if necessary;
            ``(8) contain an assurance that any child care facility 
        assisted under this section will meet the applicable State or 
        local government licensing, certification, approval, or 
        registration requirements; and
            ``(9) contain a plan for any child care facility assisted 
        under this section to become accredited within 3 years of the 
        date the institution first receives assistance under this 
        section.
    ``(d) Reporting Requirements; Continuing Eligibility.--
            ``(1) Reporting requirements.--
                    ``(A) Reports.--Each institution of higher 
                education receiving a grant under this section shall 
                report to the Secretary 18 months, and 36 months, after 
                receiving the first grant payment under this section.
                    ``(B) Contents.--The report shall include--
                            ``(i) data on the population served under 
                        this section;
                            ``(ii) information on campus and community 
                        resources and funding used to help low-income 
                        students access child care services;
                            ``(iii) information on progress made toward 
                        accreditation of any child care facility; and
                            ``(iv) information on the impact of the 
                        grant on the quality, availability, and 
                        affordability of campus-based child care 
                        services.
            ``(2) Continuing eligibility.--The Secretary shall make the 
        third annual grant payment under this section to an institution 
        of higher education only if the Secretary determines, on the 
        basis of the 18-month report submitted under paragraph (1), 
        that the institution is making a good faith effort to ensure 
        that low-income students at the institution have access to 
        affordable, quality child care services.
    ``(e) Authorization of Appropriations.--There are authorized to be 
appropriated to carry out this section $60,000,000 for fiscal year 1999 
and such sums as may be necessary for each of the 4 succeeding fiscal 
years.''.

             PART B--FEDERAL FAMILY EDUCATION LOAN PROGRAM

SEC. 421. ADVANCES FOR RESERVE FUNDS.

    Section 422 (20 U.S.C. 1072) is amended--
            (1) in subsection (c)--
                    (A) in paragraph (6)(B)(i), by striking ``written'' 
                and inserting ``written, electronic''; and
                    (B) in paragraph (7)(A), by striking ``during the 
                transition from the Federal Family Education Loan 
                Program under this part to the Federal Direct Student 
                Loan Program under part D of this title'';
            (2) in the matter preceding subparagraph (A) of subsection 
        (g)(1), by striking ``or the program authorized by part D of 
        this title'' each place the term appears; and
            (3) by adding at the end the following:
    ``(i) Additional Recall of Reserves.--
            ``(1) In general.--Notwithstanding any other provision of 
        law and subject to paragraph (4), the Secretary shall recall 
        $40,000,000 for each of the fiscal years 1999, 2000, 2001, 
        2002, and 2003 from reserve funds held in the Federal Student 
        Loan Reserve Funds established under section 422A by guaranty 
        agencies.
            ``(2) Deposit.--Funds recalled by the Secretary under this 
        subsection shall be deposited in the Treasury.
            ``(3) Required share.--The Secretary shall require each 
        guaranty agency to return reserve funds under paragraph (1) 
        annually on the basis of \1/5\ of the agency's required share. 
        For purposes of this paragraph, a guaranty agency's required 
        share shall be determined as follows:
                    ``(A) Equal percentage.--The Secretary shall 
                require each guaranty agency to return an equal 
                percentage reduction in the amount of reserve funds 
                held by the agency on September 30, 1996.
                    ``(B) Calculation.--The equal percentage reduction 
                shall be the percentage obtained by dividing--
                            ``(i) $200,000,000, by
                            ``(ii) the total amount of all guaranty 
                        agencies' reserve funds held on September 30, 
                        1996.
            ``(4) Offset of required shares.--If any guaranty agency 
        returns to the Secretary any reserve funds in excess of the 
        amount required under this subsection or subsection (h), the 
        total amount required to be returned under paragraph (1) shall 
        be reduced by the amount of such excess reserve funds returned.
            ``(5) Definition of reserve funds.--The term `reserve 
        funds' when used with respect to a guaranty agency--
                    ``(A) includes any reserve funds in cash or liquid 
                assets held by the guaranty agency, or held by, or 
                under the control of, any other entity; and
                    ``(B) does not include buildings, equipment, or 
                other nonliquid assets.''.

SEC. 422. FEDERAL STUDENT LOAN RESERVE FUND.

    Part B of title IV (20 U.S.C. 1071 et seq.) is amended by inserting 
after section 422 (20 U.S.C. 1072) the following:

``SEC. 422A. FEDERAL STUDENT LOAN RESERVE FUND.

    ``(a) Establishment.--Each guaranty agency shall, not later than 45 
days after the date of enactment of this section, deposit all funds, 
securities, and other liquid assets contained in the reserve fund 
established pursuant to section 422 into a Federal Student Loan Reserve 
Fund (in this section referred to as the `Federal Fund'), in an account 
of a type selected by the agency, with the approval of the Secretary.
    ``(b) Investment of Funds.--Funds transferred to the Federal Fund 
shall be invested in obligations issued or guaranteed by the United 
States or a State, or in other similarly low-risk securities selected 
by the guaranty agency, with the approval of the Secretary. Earnings 
from the Federal Fund shall be the sole property of the Federal 
Government.
    ``(c) Additional Deposits.--After the establishment of the Federal 
Fund, a guaranty agency shall deposit into the Federal Fund--
            ``(1) all amounts received from the Secretary as payment of 
        reinsurance on loans pursuant to section 428(c)(1);
            ``(2) from amounts collected on behalf of the obligation of 
        a defaulted borrower, a percentage amount equal to the 
        complement of the reinsurance percentage in effect when payment 
        under the guaranty agreement was made with respect to the 
        defaulted loan pursuant to section 428(c)(6)(A)(i); and
            ``(3) the amount of the insurance premium collected from 
        borrowers pursuant to section 428(b)(1)(H).
    ``(d) Uses of Funds.--Subject to subsection (f), the Federal Fund 
may only be used by a guaranty agency--
            ``(1) to pay lender claims pursuant to sections 
        428(b)(1)(G), 428(j), 437, and 439(q); and
            ``(2) to pay into the Agency Operating Fund established 
        pursuant to section 422B a default prevention fee in accordance 
        with section 428(l).
    ``(e) Ownership of Federal Fund.--The Federal Fund administered by 
the guaranty agency, regardless of who holds or controls the reserve 
funds or assets, and any nonliquid assets that were purchased with 
Federal reserve funds, shall be considered to be the property of the 
United States to be used in the operation of the program authorized by 
this part, as provided in subsection (d). The Secretary may direct a 
guaranty agency, or such agency's officers or directors, to cease any 
activity involving expenditure, use, or transfer of the Federal Fund 
administered by the guaranty agency that the Secretary determines is a 
misapplication, misuse, or improper expenditure of such funds or 
assets.
    ``(f) Transition.--
            ``(1) In general.--In order to establish the Agency 
        Operating Fund established by section 422B, each agency may 
        transfer not more than 180 days cash expenses for normal 
        operating expenses, as a working capital reserve as defined in 
        Office of Management and Budget Circular A-87 (Cost Accounting 
        Standards) for use in the performance of the agency's duties 
        under this part. Such transfers may occur during the first 3 
        years following the establishment of the Agency Operating Fund, 
        except that no agency may transfer in excess of 40 percent of 
        the Federal Fund balance to the agency's Agency Operating Fund 
        during any fiscal year. In determining the amount necessary for 
        transfer, the agency shall assure that sufficient funds remain 
        in the Federal Fund to pay lender claims within the required 
        time periods and to meet the reserve funds recall requirements 
        of subsection (b).
            ``(2) Repayment provisions.--Each guaranty agency shall 
        begin repayment of sums transferred pursuant to this subsection 
        not later than 3 years after the establishment of the Agency 
        Operating Fund, and shall repay all sums transferred not later 
        than 5 years from the date of the establishment of the Agency 
        Operating Fund. The guaranty agency shall provide to the 
        Secretary a schedule for repayment of the sums transferred and 
        an annual financial analysis demonstrating the agency's ability 
        to comply with the schedule and repay all outstanding sums 
        transferred.
            ``(3) Prohibition.--If a guaranty agency transfers funds 
        from the Federal Fund in accordance with this section, and 
        fails to make scheduled repayments to the Federal Fund, the 
        agency may not receive any other funds under this part until 
        the Secretary determines that the agency has made such 
        repayments.
            ``(4) Waiver.--The Secretary may waive the requirements of 
        paragraph (3) for a guaranty agency described in such paragraph 
        if the Secretary determines there are extenuating circumstances 
        beyond the control of the agency that justify such a waiver.
            ``(5) Investment of federal funds.--Funds transferred from 
        the Federal Fund to the Agency Operating Fund for operating 
        expenses shall be invested in obligations issued or guaranteed 
        by the United States or a State, or in other similarly low-risk 
        securities selected by the guaranty agency, with the approval 
        of the Secretary.
            ``(6) Special rule.--In applying the minimum reserve level 
        required by section 428(c)(9)(A), the Secretary shall include 
        all amounts owed to the Federal Fund by the guaranty agency in 
        the calculation.''.

SEC. 423. AGENCY OPERATING FUND.

    Part B of title IV (20 U.S.C. 1071 et seq.) is amended further by 
inserting after section 422A (as added by section 422) the following:

``SEC. 422B. AGENCY OPERATING FUND.

    ``(a) Establishment.--Each guaranty agency shall, not later than 45 
days after the date of enactment of this section, establish a fund 
designated as the Agency Operating Fund (in this section referred to as 
the `Operating Fund').
    ``(b) Investment of Funds.--Funds deposited into the Operating 
Fund, with the exception of funds transferred from the Federal Student 
Loan Reserve Fund pursuant to section 422A(f), shall be invested at the 
discretion of the guaranty agency.
    ``(c) Additional Deposits.--After the establishment of the 
Operating Fund, the guaranty agency shall deposit into the Operating 
Fund--
            ``(1) the loan processing and issuance fee paid by the 
        Secretary pursuant to section 428(f);
            ``(2) the portfolio maintenance fee paid by the Secretary 
        in accordance with section 458;
            ``(3) the default prevention fee paid in accordance with 
        section 428(l); and
            ``(4) amounts remaining pursuant to section 
        428(c)(6)(A)(ii) from collection on defaulted loans held by the 
        agency, after payment of the Secretary's equitable share, 
        excluding amounts deposited in the Federal Student Loan Reserve 
        Fund pursuant to section 422A(c)(2).
    ``(d) Uses of Funds.--
            ``(1) In general.--Funds in the Operating Fund shall be 
        used for application processing, loan disbursement, enrollment 
        and repayment status management, default prevention activities 
        (including those described in section 422(h)(8), default 
        collection activities, school and lender training, compliance 
        monitoring, and other student financial aid related activities 
        as determined by the Secretary.
            ``(2) Special rule.--The guaranty agency may, in the 
        agency's discretion, transfer funds from the Operating Fund to 
        the Federal Student Loan Reserve Fund for use pursuant to 
        section 422A. Such transfer shall be irrevocable, and any funds 
        so transferred shall become the sole property of the United 
        States.
            ``(3) Definitions.--For purposes of this subsection:
                    ``(A) Default collection activities.--The term 
                `default collection activities' means activities of a 
                guaranty agency that are directly related to the 
                collection of the loan on which a default claim has 
                been paid to the participating lender, including the 
                attributable compensation of collection personnel (and 
                in the case of personnel who perform several functions 
                for such an agency only the portion of the compensation 
                attributable to the collection activity), attorney's 
                fees, fees paid to collection agencies, postage, 
                equipment, supplies, telephone, and similar charges.
                    ``(B) Default prevention activities.--The term 
                `default prevention activities' means activities of a 
                guaranty agency, including those described in section 
                422(h)(8), that are directly related to providing 
                collection assistance to the lender on a delinquent 
                loan, prior to the loan's being in a default status, 
                including the attributable compensation of appropriate 
                personnel (and in the case of personnel who perform 
                several functions for such an agency only the portion 
                of compensation attributable to the default prevention 
                activity), fees paid to locate a missing borrower, 
                postage, equipment, supplies, telephone, and similar 
                charges.
                    ``(C) Enrollment and repayment status management.--
                The term `enrollment and repayment status management' 
                means activities of a guaranty agency that are directly 
                related to ascertaining the student's enrollment 
                status, including prompt notification to the lender of 
                such status, an audit of the note or written agreement 
                to determine if the provisions of that note or 
                agreement are consistent with the records of the 
                guaranty agency as to the principal amount of the loan 
                guaranteed, and an examination of the note or agreement 
                to assure that the repayment provisions are consistent 
                with the provisions of this title.
    ``(e) Ownership of Operating Fund.--The Operating Fund, with the 
exception of funds transferred from the Federal Student Loan Reserve 
Fund in accordance with section 422A(f), shall be considered to be the 
property of the guaranty agency. The Secretary may not regulate the 
uses or expenditure of moneys in the Operating Fund, but the Secretary 
may require such necessary reports and audits as provided in section 
428(b)(2). However, during any period in which funds are owed to the 
Federal Student Loan Reserve Fund as a result of transfer under 
422A(f), moneys in the Operating Fund may only be used for expenses 
related to the student loan programs authorized under this part.
    ``(f) Authority of Secretary To Dispose of Nonliquid Assets.--The 
Secretary may allow a guaranty agency to purchase nonliquid assets of 
the agency originally acquired with student loan reserve funds, except 
that an agency may not purchase any nonliquid assets during any period 
in which funds are owed to the Federal Student Loan Reserve Fund as a 
result of a transfer under section 422A(f). The purchase amount shall 
be available for expenditure under section 458.''.

SEC. 424. APPLICABLE INTEREST RATES.

    (a) Applicable Interest Rates.--
            (1) Amendment.--Section 427A (20 U.S.C. 1077a et seq.) is 
        amended to read as follows:

``SEC. 427A. APPLICABLE INTEREST RATES.

    ``(a) Interest Rates for New Loans On or After July 1, 1998.--
            ``(1) In general.--Subject to paragraph (2), with respect 
        to any loan made, insured, or guaranteed under this part (other 
        than a loan made pursuant to section 428B or 428C) for which 
        the first disbursement is made on or after July 1, 1998, the 
        applicable rate of interest shall, during any 12-month period 
        beginning on July 1 and ending on June 30, be determined on the 
        preceding June 1 and be equal to--
                    ``(A) the bond equivalent rate of 91-day Treasury 
                bills auctioned at the final auction held prior to such 
                June 1; plus
                    ``(B) 2.3 percent,
        except that such rate shall not exceed 8.25 percent.
            ``(2) In school and grace period rules.--With respect to 
        any loan under this part (other than a loan made pursuant to 
        section 428B or 428C) for which the first disbursement is made 
        on or after July 1, 1998, the applicable rate of interest for 
        interest which accrues--
                    ``(A) prior to the beginning of the repayment 
                period of the loan; or
                    ``(B) during the period in which principal need not 
                be paid (whether or not such principal is in fact paid) 
                by reason of a provision described in section 
                428(b)(1)(M) or 427(a)(2)(C),
        shall be determined under paragraph (1) by substituting `1.7 
        percent' for `2.3 percent'.
            ``(3) PLUS loans.--With respect to any loan under section 
        428B for which the first disbursement is made on or after July 
        1, 1998, the applicable rate of interest shall be determined 
        under paragraph (1)--
                    ``(A) by substituting `3.1 percent' for `2.3 
                percent'; and
                    ``(B) by substituting `9.0 percent' for `8.25 
                percent'.
    ``(b) Lesser Rates Permitted.--Nothing in this section or section 
428C shall be construed to prohibit a lender from charging a borrower 
interest at a rate less than the rate which is applicable under this 
part.
    ``(c) Consultation.--The Secretary shall determine the applicable 
rate of interest under this section after consultation with the 
Secretary of the Treasury and shall publish such rate in the Federal 
Register as soon as practicable after the date of determination.''.
            (2) Conforming amendment.--Section 428B(d)(4) (20 U.S.C. 
        1078-2(d)(4)) is amended by striking ``section 427A(c)'' and 
        inserting ``section 427A(a)(3)''.
    (b) Special Allowances.--
            (1) Amendment.--Section 438(b)(2)(F) (20 U.S.C. 1087-
        1(b)(2)(F)) is amended to read as follows:
            ``(F) Loans disbursed after july 1, 1998.--
                    ``(i) In general.--Subject to paragraph (4) and 
                clauses (ii), (iii), and (iv) of this subparagraph, the 
                special allowance paid pursuant to this subsection on 
                loans for which the first disbursement is made on or 
                after July 1, 1998, shall be computed--
                            ``(I) by determining the average of the 
                        bond equivalent rates of 91-day Treasury bills 
                        auctioned for such 3-month period;
                            ``(II) by subtracting the applicable 
                        interest rates on such loans from such average 
                        bond equivalent rate;
                            ``(III) by adding 2.8 percent to the 
                        resultant percent; and
                            ``(IV) by dividing the resultant percent by 
                        4.
                    ``(ii) In school and grace period.--In the case of 
                any loan for which the first disbursement is made on or 
                after July 1, 1998, and for which the applicable rate 
                of interest is described in section 427A(a)(2), clause 
                (i)(III) of this subparagraph shall be applied by 
                substituting `2.2 percent' for `2.8 percent'.
                    ``(iii) PLUS loans.--In the case of any loan for 
                which the first disbursement is made on or after July 
                1, 1998, and for which the applicable rate of interest 
                is described in section 427A(a)(3), clause (i)(III) of 
                this subparagraph shall be applied by substituting `3.1 
                percent' for `2.8 percent', subject to clause (iv) of 
                this subparagraph.
                    ``(iv) Limitation on special allowances for plus 
                loans.--In the case of loans disbursed on or after July 
                1, 1998, for which the interest rate is determined 
                under section 427A(a)(3), a special allowance shall not 
                be paid for a loan made under section 428B unless the 
                rate determined for any 12-month period under section 
                427A(a)(3) exceeds 9 percent.''.
            (2) Conforming amendment.--Section 438(b)(2)(C)(ii) is 
        amended by striking ``In the case'' and inserting ``Subject to 
        subparagraph (F), in the case''.
    (c) Effective Date.--The amendments made by this section shall 
apply with respect to any loan made, insured, or guaranteed under part 
B of title IV of the Higher Education Act of 1965 for which the first 
disbursement is made on or after July 1, 1998.

SEC. 425. FEDERAL PAYMENTS TO REDUCE STUDENT INTEREST COSTS.

    (a) Federal Interest Subsidies.--Section 428(a) (20 U.S.C. 1078(a)) 
is amended--
            (1) in paragraph (2)--
                    (A) in subparagraph (A)--
                            (i) in clause (i), by striking subclauses 
                        (I), (II), and (III) and inserting the 
                        following:
                            ``(I) sets forth the loan amount for which 
                        the student shows financial need; and
                            ``(II) sets forth a schedule for 
                        disbursement of the proceeds of the loan in 
                        installments, consistent with the requirements 
                        of section 428G; and''; and
                            (ii) by amending clause (ii) to read as 
                        follows:
                    ``(ii) meets the requirements of subparagraph (B); 
                and'';
                    (B) by amending subparagraph (B) to read as 
                follows:
            ``(B) For the purpose of clause (ii) of subparagraph (A), a 
        student shall qualify for a portion of an interest payment 
        under paragraph (1) (and a loan amount pursuant to section 
        428H) if the eligible institution has determined and documented 
        the student's amount of need for a loan based on the student's 
        estimated cost of attendance, estimated financial assistance, 
        and, for the purpose of an interest payment pursuant to this 
        section, the expected family contribution (as determined under 
        part F), subject to the provisions of subparagraph (D).''; and
                    (C) by amending subparagraph (C) to read as 
                follows:
            ``(C) For the purpose of subparagraph (B) and this 
        paragraph--
                    ``(i) a student's cost of attendance shall be 
                determined under section 472;
                    ``(ii) a student's estimated financial assistance 
                means, for the period for which the loan is sought, the 
                amount of assistance such student will receive under 
                subpart 1 of part A (as determined in accordance with 
                section 484(b)), subpart 3 of part A, parts C and E, 
                and any veterans' education benefits paid because of 
                enrollment in a postsecondary education institution, 
                including veterans' education benefits (as defined in 
                section 480(c)), plus other scholarship, grant, or loan 
                assistance; and
                    ``(iii) the determination of need and of the amount 
                of a loan by an eligible institution under subparagraph 
                (B) with respect to a student shall, with the exception 
                of loans made under section 428H, be calculated in 
                accordance with part F.''; and
            (2) in paragraph (3)(A)(v)--
                    (A) in subclause (I), by inserting ``by the 
                institution'' after ``disbursement''; and
                    (B) in clause (II), by inserting ``by the 
                institution'' after ``disbursement''.
    (b) Insurance Program Agreements.--Section 428(b) (20 U.S.C. 
1078(b)) is amended--
            (1) in paragraph (1)--
                    (A) in subparagraph (A)--
                            (i) in the matter preceding clause (i), by 
                        inserting ``, as defined in section 
                        481(d)(2),'' after ``academic year'';
                            (ii) in clause (iv), by striking ``and'' 
                        after the semicolon;
                            (iii) in clause (v), by inserting ``and'' 
                        after the semicolon; and
                            (iv) by inserting before the matter 
                        following clause (v) the following:
                            ``(vi) in the case of a student enrolled in 
                        coursework specified in sections 484(b)(3)(B) 
                        and 484(b)(4)(B)--
                                    ``(I) $2,625 for coursework 
                                necessary for enrollment in an 
                                undergraduate degree or certificate 
                                program, and $5,500 for coursework 
                                necessary for enrollment in a graduate 
                                or professional degree or certification 
                                program; and
                                    ``(II) $5,500 for coursework 
                                necessary for a professional credential 
                                or certification from a State required 
                                for employment as a teacher in an 
                                elementary or secondary school;'';
                    (B) by amending subparagraph (E) to read as 
                follows:
                    ``(E) subject to subparagraphs (D) and (L), and 
                except as provided by subparagraph (M), provides that--
                            ``(i) not more than 6 months prior to the 
                        date on which the borrower's first payment is 
                        due, the lender shall offer the borrower of a 
                        loan made, insured, or guaranteed under this 
                        section or section 428H, the option of repaying 
                        the loan in accordance with a graduated, 
                        income-sensitive, or extended repayment 
                        schedule (as described in paragraph (9)) 
                        established by the lender in accordance with 
                        regulations provided by the Secretary; and
                            ``(ii) repayment of loans shall be in 
                        installments in accordance with the repayment 
                        plan selected under paragraph (9) and 
                        commencing at the beginning of the repayment 
                        period determined under paragraph (7)'';
                    (C) in subparagraph (L)(i), by inserting ``except 
                as otherwise provided by a repayment plan selected by 
                the borrower under clause (ii) or (iii) of paragraph 
                (9)(A),'' before ``during any''; and
                    (D) in subparagraph (U)(iii)(I), by inserting 
                ``that originates or holds more than $5,000,000 in 
                loans made under this title for any fiscal year,'' 
                before ``at least once a year''; and
            (2) by adding at the end the following:
            ``(9) Repayment plans.--
                    ``(A) Design and selection.--In accordance with 
                regulations promulgated by the Secretary, the lender 
                shall offer a borrower of a loan made under this part 
                the plans described in this subparagraph for repayment 
                of such loan, including principal and interest thereon. 
                Except as provided in paragraph (1)(L)(i), no plan may 
                require a borrower to repay a loan in less than 5 
                years. The borrower may choose from--
                            ``(i) a standard repayment plan, with a 
                        fixed annual repayment amount paid over a fixed 
                        period of time, not to exceed 10 years;
                            ``(ii) a graduated repayment plan paid over 
                        a fixed period of time, not to exceed 10 years;
                            ``(iii) an income-sensitive repayment plan, 
                        with income-sensitive repayment amounts paid 
                        over a fixed period of time, not to exceed 10 
                        years, except that the borrower's scheduled 
                        payments shall not be less than the amount of 
                        interest due; and
                            ``(iv) for first-time borrowers on or after 
                        the date of enactment of the Higher Education 
                        Amendments of 1998 with outstanding loans under 
                        this part totaling more than $30,000, an 
                        extended repayment plan, with a fixed annual or 
                        graduated repayment amount paid over an 
                        extended period of time, not to exceed 25 
                        years, except that the borrower shall repay 
                        annually a minimum amount determined in 
                        accordance with paragraph (2)(L).
                    ``(B) Lender selection of option if borrower does 
                not select.--If a borrower of a loan made under this 
                part does not select a repayment plan described in 
                subparagraph (A), the lender shall provide the borrower 
                with a repayment plan described in subparagraph (A)(i).
                    ``(C) Changes in selection.--The borrower of a loan 
                made under this part may change the borrower's 
                selection of a repayment plan under subparagraph (B), 
                as the case may be, under such conditions as may be 
                prescribed by the Secretary in regulation.
                    ``(D) Acceleration permitted.--Under any of the 
                plans described in this paragraph, the borrower shall 
                be entitled to accelerate, without penalty, repayment 
                on the borrower's loans under this part.''.
    (c) Guaranty Agreements for Reimbursing Losses.--Section 428(c) (20 
U.S.C. 1078(c)) is amended--
            (1) in paragraph (1)--
                    (A) in the fourth sentence of subparagraph (A), by 
                striking ``as reimbursement under this subsection shall 
                be equal to 98 percent'' and inserting ``as 
                reimbursement for loans for which the first 
                disbursement is made on or after the date of enactment 
                of the Higher Education Amendments of 1998 shall be 
                equal to 95 percent'';
                    (B) in subparagraph (B)--
                            (i) in clause (i), by striking ``88 percent 
                        of the amount of such excess'' and inserting 
                        ``85 percent of the amount of such excess for 
                        loans for which the first disbursement is made 
                        on or after the date of enactment of the Higher 
                        Education Amendments of 1998''; and
                            (ii) in clause (ii), by striking ``78 
                        percent of the amount of such excess'' and 
                        inserting ``75 percent of the amount of such 
                        excess for loans for which the first 
                        disbursement is made on or after the date of 
                        enactment of the Higher Education Amendments of 
                        1998'';
                    (C) in subparagraph (E)--
                            (i) in clause (i), by striking ``98 
                        percent'' and inserting ``95 percent'';
                            (ii) in clause (ii), by striking ``88 
                        percent'' and inserting ``85 percent''; and
                            (iii) in clause (iii), by striking ``78 
                        percent'' and inserting ``75 percent''; and
                    (D) in subparagraph (F)--
                            (i) in clause (i), by striking ``98 
                        percent'' and inserting ``95 percent''; and
                            (ii) in clause (ii), by striking ``88 
                        percent'' and inserting ``85 percent'';
            (2) in paragraph (3)--
                    (A) in subparagraph (A)(i), by inserting ``or 
                electronic'' after ``written'';
                    (B) in subparagraph (B), by striking ``and'' after 
                the semicolon;
                    (C) in subparagraph (C), by striking the period and 
                inserting ``; and''; and
                    (D) by inserting before the matter following 
                subparagraph (C) the following:
                    ``(D) shall contain provisions that specify that 
                forbearance for a period not to exceed 60 days may be 
                granted if the lender determines that such a suspension 
                of collection activity is warranted following a 
                borrower's request for forbearance in order to collect 
                or process appropriate supporting documentation related 
                to the request, and that during such period interest 
                shall not be capitalized.'';
            (3) by amending paragraph (6) to read as follows:
            ``(6) Secretary's equitable share.--For the purpose of 
        paragraph (2)(D), the Secretary's equitable share of payments 
        made by the borrower shall be that portion of the payments 
        remaining after the guaranty agency with which the Secretary 
        has an agreement under this subsection has deducted from such 
        payments--
                    ``(A) a percentage amount equal to the complement 
                of the reinsurance percentage in effect when payment in 
                effect when payment under the guaranty agreement was 
                made with respect to the loan; and
                    ``(B) an amount equal to 24 percent of such 
                payments for use in accordance with section 422B.'';
            (4) in paragraph (8)--
                    (A) by striking ``(A) If'' and inserting ``If''; 
                and
                    (B) by striking subparagraph (B); and
            (5) in paragraph (9)--
                    (A) in subparagraph (A), by striking ``maintain a 
                current minimum reserve level of at least .5 percent'' 
                and inserting ``maintain in the agency's Federal 
                Student Loan Reserve Fund established under section 
                422A a current minimum reserve level of at least 0.25 
                percent'';
                    (B) in subparagraph (C)--
                            (i) by striking ``80 percent'' and 
                        inserting ``78 percent'';
                            (ii) by striking ``, as appropriate,''; and
                            (iii) by striking ``30 working'' and 
                        inserting ``45 working'';
                    (C) in subparagraph (E)--
                            (i) in clause (iv), by inserting ``or'' 
                        after the semicolon;
                            (ii) in clause (v), by striking ``; or'' 
                        and inserting a period; and
                            (iii) by striking clause (vi);
                    (D) in subparagraph (F), by amending clause (vii) 
                to read as follows:
                    ``(vii) take any other action the Secretary 
                determines necessary to avoid disruption of the student 
                loan program, to ensure the continued availability of 
loans made under this part to residents of each State in which the 
guaranty agency did business, to ensure the full honoring of all 
guarantees issued by the guaranty agency prior to the Secretary's 
assumption of the functions of such agency, and to ensure the proper 
servicing of loans guaranteed by the guaranty agency prior to the 
Secretary's assumption of the functions of such agency.''; and
                    (E) in subparagraph (K), by striking ``and the 
                progress of the transition from the loan programs under 
                this part to the direct student loan programs under 
                part D of this title''.
    (d) Payment for Lender Referral Services.--Subsection (e) of 
section 428 (20 U.S.C. 1078) is repealed.
    (e) Payment of Certain Costs.--Subsection (f) of section 428 (20 
U.S.C. 1078) is amended to read as follows:
    ``(f) Payments of Certain Costs.--
            ``(1) Payment for certain activities.--
                    ``(A) In general.--The Secretary, for loans 
                originated on or after October 1, 1998, and in 
                accordance with the provisions of this paragraph, shall 
                pay to each guaranty agency, a loan processing and 
                issuance fee equal to 0.65 percent of the total 
                principal amount of the loans on which insurance was 
                issued under this part during such fiscal year by such 
                agency.
                    ``(B) Payment.--The payment required by 
                subparagraph (A) shall be paid on a quarterly basis. 
                The guaranty agency shall be deemed to have a 
                contractual right against the United States to receive 
                payments according to the provisions of this 
                subparagraph. Payments shall be made promptly and 
                without administrative delay to any guaranty agency 
                submitting an accurate and complete application 
                therefore under this subparagraph.''.
    (f) Lenders-of-Last-Resort.--Paragraph (3) of section 428(j) (20 
U.S.C. 1078(j)) is amended--
            (1) in the paragraph heading, by striking ``during 
        transition to direct lending''; and
            (2) in subparagraph (A), by striking ``during the 
        transition from the Federal Family Education Loan Program under 
        this part to the Federal Direct Student Loan Program under part 
        D of this title'';
    (g) Default Aversion Assistance.--Subsection (l) of section 428 (20 
U.S.C. 1078) is amended to read as follows:
    ``(l) Default Aversion Assistance.--
            ``(1) Assistance required.--Upon receipt of a proper 
        request from the lender not earlier than the 60th nor later 
        than the 90th day of delinquency, a guaranty agency having an 
        agreement with the Secretary under subsection (c) shall engage 
        in default aversion activities designed to prevent the default 
        by a borrower on a loan covered by such agreement.
            ``(2) Default prevention fee required.--
                    ``(A) In general.--A guaranty agency, in accordance 
                with the provisions of this paragraph, may transfer 
                from the Federal Student Loan Reserve Fund to the 
                Agency Operating Fund a default prevention fee. Such 
                fee shall be paid for any loan on which a claim for 
                default has not been presented that the guaranty agency 
                successfully brings into current repayment status on or 
                before the 210th day after the loan becomes 60 days 
                delinquent.
                    ``(B) Amount.--The default prevention fee shall be 
                equal to 1 percent of the total unpaid principal and 
                accrued interest on the loan calculated at the time the 
                request is submitted by the lender. Such fee shall not 
                be paid more than once on any loan for which the 
                guaranty agency averts the default unless the borrower 
remained current in payments for at least 24 months prior to the 
subsequent delinquency. A guaranty agency may transfer such fees earned 
under this subsection not more frequently than monthly.
                    ``(C) Definition of current repayment status.--For 
                the purpose of this paragraph, the term `current 
                repayment status' means that the borrower is not 
                delinquent, in any respect, in the payment of principal 
                and interest on the loan at the time the guaranty 
                agency qualifies for the default prevention fee.''.
    (h) State Share of Default Costs.--Subsection (n) of section 428 
(20 U.S.C. 1078) is repealed.

SEC. 426. VOLUNTARY FLEXIBLE AGREEMENTS WITH GUARANTY AGENCIES.

    Part B of title IV (20 U.S.C. 1071 et seq.) is amended by inserting 
after section 428 (20 U.S.C. 1078) the following:

``SEC. 428A. VOLUNTARY FLEXIBLE AGREEMENTS WITH GUARANTY AGENCIES.

    ``(a) Voluntary Agreements.--
            ``(1) Authority.--The Secretary may enter into a voluntary, 
        flexible agreement, subject to paragraph (2), with guaranty 
        agencies under this section, in lieu of agreements with a 
        guaranty agency under subsections (b) and (c) of section 428. 
        The Secretary may waive or modify any requirement under such 
        subsections, except that the Secretary may not waive any 
        statutory requirement pertaining to the terms and conditions 
        attached to student loans, default claim payments made to 
        lenders, or the prohibitions on inducements contained in 
        section 428(b)(3).
            ``(2) Eligibility.--During fiscal years 1999, 2000, and 
        2001, the Secretary may enter into a voluntary, flexible 
        agreement with not more than 6 guaranty agencies that had 1 or 
        more agreements with the Secretary under subsections (b) and 
        (c) of section 428 as of the day before the date of enactment 
        of the Higher Education Amendments of 1998. Beginning in fiscal 
        year 2002, any guaranty agency or consortium thereof may enter 
        into a similar agreement with the Secretary.
            ``(3) Report required.--Not later than September 30, 2001, 
        the Secretary shall report to the Committee on Labor and Human 
        Resources of the Senate and the Committee on Education and the 
        Workforce of the House of Representatives regarding the impact 
        that the voluntary flexible agreements have had upon program 
        integrity, program and cost efficiencies, and the availability 
        and delivery of student financial aid. Such report shall 
        include--
                    ``(A) a description of each voluntary flexible 
                agreement and the performance goals established by the 
                Secretary for each agreement;
                    ``(B) a list of participating guaranty agencies and 
                the specific statutory or regulatory waivers provided 
                to each guaranty agency;
                    ``(C) a description of the standards by which each 
                agency's performance under the agency's voluntary 
                flexible agreement was assessed and the degree to which 
                each agency achieved the performance standards; and
                    ``(D) an analysis of the fees paid by the 
                Secretary, and the costs and efficiencies achieved 
                under each voluntary agreement.
    ``(b) Terms of Agreement.--An agreement between the Secretary and a 
guaranty agency under this section--
            ``(1) shall be developed by the Secretary, in consultation 
        with the guaranty agency, on a case-by case basis;
            ``(2) may be secured by the parties;
            ``(3) may include provisions--
                    ``(A) specifying the responsibilities of the 
                guaranty agency under the agreement, such as--
                            ``(i) administering the issuance of 
                        insurance on loans made under this part on 
                        behalf of the Secretary;
                            ``(ii) monitoring insurance commitments 
                        made under this part;
                            ``(iii) default aversion activities;
                            ``(iv) review of default claims made by 
                        lenders;
                            ``(v) payment of default claims;
                            ``(vi) collection of defaulted loans;
                            ``(vii) adoption of internal systems of 
                        accounting and auditing that are acceptable to 
                        the Secretary, and reporting the result thereof 
                        to the Secretary in a timely manner, and on an 
                        accurate, and auditable basis;
                            ``(viii) timely and accurate collection and 
                        reporting of such other data as the Secretary 
                        may require to carry out the purposes of the 
                        programs under this title;
                            ``(ix) monitoring of institutions and 
                        lenders participating in the program under this 
                        part;
                            ``(x) the performance of other program 
                        functions by the guaranty agency or the 
                        agency's affiliates; and
                            ``(xi) informational outreach to schools 
                        and students in support of access to higher 
                        education;
                    ``(B) regarding the fees the Secretary shall pay, 
                in lieu of revenues that the guaranty agency may 
                otherwise receive under this part, to the guaranty 
                agency under the agreement, and other funds that the 
                guaranty agency may receive or retain under the 
                agreement, except that in no case may the cost to the 
                Secretary of the agreement, as reasonably projected by 
                the Secretary, exceed the cost to the Secretary, as 
                similarly projected, in the absence of the agreement;
                    ``(C) regarding the use of net revenues, as 
                described in the agreement under this section, for such 
                other activities in support of postsecondary education 
                as may be agreed to by the Secretary and the guaranty 
                agency;
                    ``(D) regarding the standards by which the guaranty 
                agency's performance of the agency's responsibilities 
                under the agreement will be assessed, and the 
                consequences for a guaranty agency's failure to achieve 
                a specified level of performance on one or more 
                performance standards;
                    ``(E) regarding the circumstances in which a 
                guaranty agency's agreement under this section may be 
                ended in advance of the agency's expiration date;
                    ``(F) regarding such other businesses, previously 
                purchased or developed with reserve funds, that relate 
                to the program under this part and in which the 
                Secretary permits the guaranty agency to engage; and
                    ``(G) such other provisions as the Secretary may 
                determine to be necessary to protect the United States 
                from the risk of unreasonable loss and to promote the 
                purposes of this part; and
            ``(4) shall provide for uniform lender participation with 
        the guaranty agency under the terms of the agreement.
    ``(c) Termination.--At the expiration or early termination of an 
agreement under this section, the Secretary shall reinstate the 
guaranty agency's prior agreements under subsections (b) and (c) of 
section 428, subject only to such additional requirements as the 
Secretary determines to be necessary in order to ensure the efficient 
transfer of responsibilities between the agreement under this section 
and the agreements under subsections (b) and (c) of section 428, and 
including the guaranty agency's compliance with reserve requirements 
under sections 422 and 428.''.

SEC. 427. FEDERAL PLUS LOANS.

    Section 428B (20 U.S.C. 1078-2) is amended--
            (1) by amending subsection (a) to read as follows:
    ``(a) Authority To Borrow.--
            ``(1) Authority and eligibility.--Parents of a dependent 
        student shall be eligible to borrow funds under this section in 
        amounts specified in subsection (b), if--
                    ``(A) the parents do not have an adverse credit 
                history as determined pursuant to regulations 
                promulgated by the Secretary; and
                    ``(B) the parents meet such other eligibility 
                criteria as the Secretary may establish by regulation, 
                after consultation with guaranty agencies, eligible 
                lenders, and other organizations involved in student 
                financial assistance.
            ``(2) Terms, conditions, and benefits.--Except as provided 
        in subsections (c), (d), and (e), loans made under this section 
        shall have the same terms, conditions, and benefits as all 
        other loans made under this part.
            ``(3) Special rule.--Whenever necessary to carry out the 
        provisions of this section, the terms ``student'' and 
        ``borrower'' as used in this part shall include a parent 
        borrower under this section.''; and
            (2) by adding at the end the following:
    ``(f) Verification of Immigration Status and Social Security 
Number.--A parent who wishes to borrow funds under this section shall 
be subject to verification of the parent's--
            ``(1) immigration status in the same manner as immigration 
        status is verified for students under section 484(g); and
            ``(2) social security number in the same manner as social 
        security numbers are verified for students under section 
        484(p).''.

SEC. 428. FEDERAL CONSOLIDATION LOANS.

    Section 428C(a)(3) (20 U.S.C. 1078-3(a)(3)) is amended--
            (1) by amending subparagraph (A) to read as follows: ``(A) 
        For the purpose of this section, the term `eligible borrower' 
        means a borrower who--
                    ``(i) is not subject to a judgment secured through 
                litigation or an order for wage garnishment under 
                section 488A; or
                    ``(ii) at the time of application for a 
                consolidation loan--
                            ``(I) is in repayment status;
                            ``(II) is in a grace period preceding 
                        repayment; or
                            ``(III) is a defaulted borrower who has 
                        made arrangements to repay the obligation on 
                        the defaulted loans satisfactory to the holders 
                        of the defaulted loans.''; and
            (2) in subparagraph (B)(i)--
                    (A) in subclause (I), by striking ``and'' after the 
                semicolon;
                    (B) by redesignating subclause (II) as subclause 
                (III);
                    (C) by inserting after subclause (I) the following:
                    ``(II) with respect to eligible student loans 
                received prior to the date of consolidation that the 
                borrower may wish to include with eligible loans 
                specified in subclause (I) in a later consolidation 
                loan; and''; and
                    (D) in subclause (III) (as redesignated by 
                subparagraph (B)--
                            (i) by striking ``that loans'' and 
                        inserting ``with respect to loans''; and
                            (ii) by inserting ``that'' before ``may be 
                        added''.

SEC. 429. REQUIREMENTS FOR DISBURSEMENTS OF STUDENT LOANS.

    Section 428G (20 U.S.C. 1078G) is amended--
            (1) in subsection (a)(1), by striking ``The proceeds'' and 
        inserting ``Except for a loan made for the final period of 
        enrollment, that is less than an academic year, in a student's 
        baccalaureate program of study, at an institution with a cohort 
        default rate (as calculated under section 435(m)) that is 5 
        percent or less, the proceeds''; and
            (2) in subsection (b)(1), by striking ``The first'' and 
        inserting ``Except for a loan made to a student borrower 
        entering an institution with a cohort default rate (as 
        calculated under section 435(m)) of less than 5 percent, the 
        first''.

SEC. 430. DEFAULT REDUCTION PROGRAM.

    The heading for subsection (b) of section 428F (20 U.S.C. 1078-6) 
is amended by striking ``Special Rule'' and inserting ``Satisfactory 
Repayment Arrangements To Renew Eligibility''.

SEC. 431. UNSUBSIDIZED LOANS.

    Section 428H (20 U.S.C. 1078-8) is amended--
            (1) by amending subsection (b) to read as follows:
    ``(b) Eligible Borrowers.--Any student meeting the requirements for 
student eligibility under section 484 (including graduate and 
professional students as defined in regulations promulgated by the 
Secretary) shall be entitled to borrow an unsubsidized Stafford loan if 
the eligible institution at which the student has been accepted for 
enrollment, or at which the student is in attendance, has--
            ``(1) determined and documented the student's need for the 
        loan based on the student's estimated cost of attendance (as 
        determined under section 472) and the student's estimated 
        financial assistance, including a loan which qualifies for 
        interest subsidy payments under section 428; and
            ``(2) provided the lender a statement--
                    ``(A) certifying the eligibility of the student to 
                receive a loan under this section and the amount of the 
                loan for which such student is eligible, in accordance 
                with subsection (c); and
                    ``(B) setting forth a schedule for disbursement of 
                the proceeds of the loan in installments, consistent 
                with the requirements of section 428G.'';
            (2) in subsection (d)--
                    (A) in paragraph (2)--
                            (i) in the matter preceding subparagraph 
                        (A)--
                                    (I) by inserting ``, as defined in 
                                section 481(d)(2),'' after ``academic 
                                year''; and
                                    (II) by striking ``or in any period 
                                of 7 consecutive months, whichever is 
                                longer,'';
                            (ii) in subparagraph (C), by inserting 
                        ``and'' after the semicolon; and
                            (iii) by inserting before the matter 
                        following subparagraph (C) the following:
                    ``(D) in the case of a student enrolled in 
                coursework specified in sections 484(b)(3)(B) and 
                484(b)(4)(B)--
                            ``(i) $4,000 for coursework necessary for 
                        enrollment in an undergraduate degree or 
                        certificate program, and $5,000 for coursework 
                        necessary for enrollment in a graduate or 
                        professional program; and
                            ``(ii) $5,000 for coursework necessary for 
                        a professional credential or certification from 
                        a State required for employment as a teacher in 
                        an elementary or secondary school;''; and
                    (B) in paragraph (3), by adding at the end the 
                following: ``The maximum aggregate amount shall not 
                include interest capitalized from an in-school 
                period.''; and
            (3) in subsection (e)(6), by striking ``10 year repayment 
        period under section 428(b)(1)(D)'' and inserting ``repayment 
        period under section 428(b)(9)''.

SEC. 432. LOAN FORGIVENESS FOR TEACHERS.

    Section 428J (20 U.S.C. 1078-10) is amended to read as follows:

``SEC. 428J. LOAN FORGIVENESS FOR TEACHERS.

    ``(a) Statement of Purpose.--It is the purpose of this section to 
encourage individuals to enter and continue in the teaching profession.
    ``(b) Program Authorized.--The Secretary is authorized to carry out 
a program, through the holder of the loan, of assuming the obligation 
to repay a loan made under section 428 that is eligible for interest 
subsidy, for any new borrower on or after the date of enactment of the 
Higher Education Amendments of 1998, who--
            ``(1) has been employed as a full-time teacher for 3 
        consecutive complete school years--
                    ``(A) in a school that qualifies under section 
                465(a)(2)(A) for loan cancellation for Perkins loan 
                recipients who teach in such schools;
                    ``(B) if employed as a secondary school teacher, is 
                teaching a subject area that is relevant to the 
                borrower's academic major as certified by the chief 
                administrative officer of the public or nonprofit 
                private secondary school in which the borrower is 
                employed; and
                    ``(C) if employed as an elementary school teacher, 
                has demonstrated, in accordance with State teacher 
                certification or licensing requirements and as 
                certified by the chief administrative officer of the 
                public or nonprofit private elementary school in which 
                the borrower is employed, knowledge and teaching skills 
                in reading, writing, mathematics and other areas of the 
                elementary school curriculum; and
            ``(2) is not in default on a loan for which the borrower 
        seeks forgiveness.
    ``(c) Regulations.--The Secretary is authorized to issue such 
regulations as may be necessary to carry out the provisions of this 
section.
    ``(d) Loan Repayment During Continuing Teaching Service.--
            ``(1) In general.--The Secretary shall assume the 
        obligation to repay through reimbursement to the holder--
                    ``(A) 30 percent of the total outstanding amount 
                and applicable interest of subsidized Federal Stafford 
                loans owed by the student borrower after the completion 
                of the fourth or fifth complete school year of service 
                described in subsection (b);
                    ``(B) 40 percent of such total amount after the 
                completion of the sixth complete school year of such 
                service; and
                    ``(C) a total amount for any borrower that shall 
                not exceed $10,000.
            ``(2) Construction.--Nothing in this section shall be 
        construed to authorize any refunding of any repayment of a 
        loan.
    ``(e) List.--If the list of schools in which a teacher may perform 
service pursuant to subsection (b) is not available before May 1 of any 
year, the Secretary may use the list for the year preceding the year 
for which the determination is made to make such service determination.
    ``(f) Continued Eligibility.--Any teacher who performs service in a 
school that--
            ``(1) meets the requirements of subsection (b)(1)(A) in any 
        year during such service; and
            ``(2) in a subsequent year fails to meet the requirements 
        of such subsection, may continue to teach in such school and 
        shall be eligible for loan forgiveness pursuant to subsection 
        (b).''.

SEC. 433. COMMON FORMS AND FORMATS.

    Section 432(m)(1) (20 U.S.C. 1082(m)(1)) is amended--
            (1) in subparagraph (A), by striking ``a common application 
        form and promissory note'' and inserting ``common application 
        forms and promissory notes, or multiyear promissory notes,'';
            (2) by striking subparagraph (C);
            (3) by redesignating subparagraph (D) as subparagraph (C); 
        and
            (4) in subparagraph (C) (as redesignated by paragraph 
        (3))--
                    (A) by inserting ``, application and other'' after 
                ``electronic''; and
                    (B) by adding at the end the following: ``Guaranty 
                agencies, borrowers, and lenders may use electronically 
                printed versions of common forms approved for use by 
                the Secretary.''.

SEC. 434. STUDENT LOAN INFORMATION BY ELIGIBLE LENDERS.

    Section 433 (20 U.S.C. 1083) is amended--
            (1) in subsection (a), by amending the matter preceding 
        paragraph (1) to read as follows:
    ``(a) Required Disclosure Before Disbursement.--Each eligible 
lender shall, at or prior to the time such lender disburses a loan that 
is insured or guaranteed under this part (other than a loan made under 
section 428C), provide thorough and accurate loan information on such 
loan to the borrower. Any disclosure required by this subsection may be 
made by an eligible lender by written or electronic means, including as 
part of the application material provided to the borrower, as part of 
the promissory note evidencing the loan, or on a separate written form 
provided to the borrower. Each lender shall provide a telephone number, 
and may provide an electronic address, to each borrower through which 
additional loan information can be obtained. The disclosure shall 
include--''; and
            (2) in subsection (b), by amending the matter preceding 
        paragraph (1) to read as follows:
    ``(b) Required Disclosure Before Repayment.--Each eligible lender 
shall, at or prior to the start of the repayment period of the student 
borrower on loans made, insured, or guaranteed under this part, 
disclose to the borrower by written or electronic means the information 
required under this subsection. Each eligible lender shall provide a 
telephone number, and may provide an electronic address, to each 
borrower through which additional loan information can be obtained. For 
any loan made, insured, or guaranteed under this part, other than a 
loan made under section 428B or 428C, such disclosure required by this 
subsection shall be made not less than 30 days nor more than 240 days 
before the first payment on the loan is due from the borrower. The 
disclosure shall include--''.

SEC. 435. DEFINITIONS.

    (a) Eligible Institution.--Section 435(a) (20 U.S.C. 1085(a)) is 
amended--
            (1) in paragraph (2)--
                    (A) by adding after the matter following 
                subparagraph (A)(ii) the following:
        ``If an institution continues to participate in a program under 
        this part, and the institution's appeal of the loss of 
        eligibility is unsuccessful, the institution shall be required 
        to pay to the Secretary an amount equal to the amount of 
        interest, special allowance, reinsurance, and any related 
        payments made by the Secretary (or which the Secretary is 
        obligated to make) with respect to loans made under this part 
        to students attending, or planning to attend, that institution 
        during the pendency of such appeal. In order to continue to 
        participate during an appeal under this paragraph, the 
        institution shall provide a letter of credit in favor of the 
        Secretary or other third-party financial guarantees 
        satisfactory to the Secretary in an amount determined by the 
        Secretary to be sufficient to satisfy the institution's 
        potential liability on such loans under the preceding 
        sentence.''; and
                    (B) by amending subparagraph (C) to read as 
                follows:
            ``(C)(i) This paragraph shall not apply to any institution 
        described in clause (ii), and any such institution that exceeds 
        the threshold percentage in subparagraph (A)(ii) for 2 
        consecutive years shall submit to the Secretary a default 
        management plan satisfactory to the Secretary and containing 
        criteria designed, in accordance with the regulations of the 
        Secretary, to demonstrate continuous improvement by the 
        institution in the institution's cohort default rate. If the 
        institution fails to submit the required plan, or to satisfy 
        the criteria in the plan, the institution shall be subject to a 
        loss of eligibility in accordance with this paragraph, except 
        as the Secretary may otherwise specify in regulations.
            ``(ii) An institution referred to in clause (i) is--
                    ``(I) a part B institution within the meaning of 
                section 322(2);
                    ``(II) a tribally controlled community college 
                within the meaning of section 2(a)(4) of the Tribally 
                Controlled Community College Assistance Act of 1978; or
                    ``(III) a Navajo Community College under the Navajo 
                Community College Act.'';
            (2) in the matter following subparagraph (C)--
                    (A) by inserting ``for a reasonable period of time, 
                not to exceed 30 days,'' after ``access''; and
                    (B) by striking ``of the affected guaranty agencies 
                and loan servicers for a reasonable period of time, not 
                to exceed 30 days'' and inserting ``used by a guaranty 
                agency in determining whether to pay a claim on a 
                defaulted loan''; and
            (3) by adding at the end the following:
            ``(4) Participation rate index.--
                    ``(A) In general.--An institution that demonstrates 
                to the Secretary that the institution's participation 
                rate index is equal to or less than 0.0375 for any of 
                the 3 applicable participation rate indices shall not 
                be subject to paragraph (2). The participation rate 
                index shall be determined by multiplying the 
                institution's cohort default rate for loans under part 
                B or D, or weighted average cohort rate for loans under 
                parts B and D, by the percentage of the institution's 
                regular students, enrolled on at least a half-time 
                basis, who received a loan made under part B or D for a 
                12-month period ending during the 6 months immediately 
                preceding the fiscal year for which the cohort of 
                borrowers used to calculate the institution's cohort 
                default rate is determined.
                    ``(B) Data.--An institution shall provide the 
                Secretary with sufficient data to determine the 
                institution's participation rate index within 30 days 
                after receiving an initial notification of the 
                institution's draft cohort default rate.
                    ``(C) Notification.--Prior to publication of a 
                final cohort default rate for an institution that 
                provides the data described in subparagraph (B), the 
                Secretary shall notify the institution of the 
                institution's compliance or noncompliance with 
                subparagraph (A).''.
    (b) Cohort Default Rate.--Section 435(m)(1)(B) (20 U.S.C. 
1085(m)(1)(B)) is amended by striking ``insurance, and, in considering 
appeals with respect to cohort default rates pursuant to subsection 
(a)(3), exclude'' and inserting ``insurance. In considering appeals 
with respect to cohort default rates pursuant to subsection (a)(3), the 
Secretary shall exclude, from the calculation of the number of students 
who entered repayment and from the calculation of the number of 
students who default,''.

SEC. 436. DELEGATION OF FUNCTIONS.

    Section 436 (20 U.S.C. 1086) is amended to read as follows:

``SEC. 436. DELEGATION OF FUNCTIONS.

    ``(a) In General.--An eligible lender or guaranty agency that 
contracts with another entity to perform any of the lender's or 
agency's functions under this title, or otherwise delegates the 
performance of such functions to such other entity--
            ``(1) shall not be relieved of the lender's or agency's 
        duty to comply with the requirements of this title; and
            ``(2) shall monitor the activities of such other entity for 
        compliance with such requirements.
    ``(b) Special Rule.--A lender that holds a loan made under part B 
in the lender's capacity as a trustee is responsible for complying with 
all statutory and regulatory requirements imposed on any other holder 
of a loan made under this part.''.

SEC. 437. SPECIAL ALLOWANCES.

    (a) Amendments.--Section 438 (20 U.S.C. 1087-1) is amended--
            (1) in subsection (c), by amending paragraph (1) to read as 
        follows:
            ``(1) Deduction from interest and special allowance 
        subsidies.--(A) Notwithstanding subsection (b), the Secretary 
        shall collect the amount the lender is authorized to charge as 
        an origination fee in accordance with paragraph (2) of this 
        subsection--
                    ``(i) by reducing the total amount of interest and 
                special allowance payable under section 428(a)(3)(A) 
                and subsection (b) of this section, respectively, to 
                any holder; or
                    ``(ii) directly from the holder of the loan, if the 
                lender fails or is not required to bill the Secretary 
                for interest and special allowance or withdraws from 
                the program with unpaid loan origination fees.
            ``(B) If the Secretary collects the origination fee under 
        this subsection through the reduction of interest and special 
        allowance, and the total amount of interest and special 
        allowance payable under section 428(a)(3)(A) and subsection (b) 
        of this section, respectively, is less than the amount the 
        lender was authorized to charge borrowers for origination fees 
        in that quarter, the Secretary shall deduct the excess amount 
        from the subsequent quarters' payments until the total amount 
        has been deducted.'';
            (2) in subsection (d), by amending paragraph (1) to read as 
        follows:
            ``(1) Deduction from interest and special allowance 
        subsidies.--
                    ``(A) In general.--Notwithstanding subsection (b), 
                the Secretary shall collect a loan fee in an amount 
                determined in accordance with paragraph (2)--
                            ``(i) by reducing the total amount of 
                        interest and special allowance payable under 
                        section 428(a)(3)(A) and subsection (b), 
                        respectively, to any holder of a loan; or
                            ``(ii) directly from the holder of the 
                        loan, if the lender--
                                    ``(I) fails or is not required to 
                                bill the Secretary for interest and 
                                special allowance payments; or
                                    ``(II) withdraws from the program 
                                with unpaid loan fees.
                    ``(B) Special rule.--If the Secretary collects loan 
                fees under this subsection through the reduction of 
                interest and special allowance payments, and the total 
                amount of interest and special allowance payable under 
                section 428(a)(3)(A) and subsection (b), respectively, 
                is less than the amount of such loan fees, then the 
                Secretary shall deduct the amount of the loan fee 
                balance from the amount of interest and special 
                allowance payments that would otherwise be payable, in 
                subsequent quarterly increments until the balance has 
                been deducted.''; and
            (3) in subsection (e)--
                    (A) by striking paragraphs (1) and (2); and
                    (B) by redesignating paragraphs (3) and (4) as 
                paragraphs (1) and (2), respectively.
    (b) Conforming Amendment.--Section 432(f)(1)(D) is amended by 
striking ``required to file a plan for doing business under section 
438(d)'' and inserting ``that meets the requirements of section 
438(e)''.

SEC. 438. STUDY OF MARKET-BASED MECHANISMS FOR DETERMINING STUDENT LOAN 
              INTEREST RATES.

    (a) Study Required.--
            (1) In general.--The Secretary of the Treasury shall 
        conduct a study of the feasibility of employing market-based 
        mechanisms, including some form of auction, for determining 
        student loan interest rates under title IV of the Higher 
        Education Act of 1965 (20 U.S.C. 1070 et seq.). The study shall 
        include--
                    (A) analysis of the potential impact of the 
                mechanisms on the delivery of student financial aid;
                    (B) analysis of the implications of the mechanisms 
                with respect to student and institutional access to 
                student loan capital;
                    (C) analysis of the potential impact of the 
                mechanisms on the costs of the programs under such 
                title for students and the Federal Government; and
                    (D) a plan for structuring and implementing the 
                mechanisms in such a manner that ensures the cost-
                effective availability of student loans for students 
                and their families.
    (b) Consultation.--In conducting the study described in paragraph 
(1), the Secretary shall consult with lenders, secondary markets, 
guaranty agencies, institutions of higher education, student loan 
borrowers, and other participants in the student loan programs under 
title IV of the Higher Education Act of 1965 (20 U.S.C. 1070 et seq.).
    (c) Report to Congress.--The Secretary of the Treasury shall report 
to the Committee on Labor and Human Resources of the Senate, and the 
Committee on Education and the Workforce of the House of 
Representatives not later than September 30, 1999, regarding the 
results of the study described in subsection (a).

                  PART C--FEDERAL WORK-STUDY PROGRAMS

SEC. 441. AUTHORIZATION OF APPROPRIATIONS; COMMUNITY SERVICES.

    Section 441 (20 U.S.C. 2751) is amended--
            (1) in subsection (b), by striking ``$800,000,000 for 
        fiscal year 1993'' and inserting ``$900,000,000 for fiscal year 
        1999''; and
            (2) in subsection (c)--
                    (A) in paragraph (1), by inserting ``(including 
                child care services provided on campus)'' after ``child 
                care''; and
                    (B) in paragraph (3), by inserting ``, including 
                students with disabilities who are enrolled at the 
                institution'' before the semicolon.

SEC. 442. GRANTS FOR FEDERAL WORK-STUDY PROGRAMS.

    Section 443(b) (20 U.S.C. 2753(b)) is amended--
            (1) by amending paragraph (3) to read as follows:
            ``(3) provide that in the selection of students for 
        employment under such work-study program, only students who 
        demonstrate financial need in accordance with part F of this 
        title and meet the requirements of section 484 will be 
        assisted, except that if the institution's grant under this 
        part is directly or indirectly based in part on the financial 
        need demonstrated by students who are (A) attending the 
        institution on less than a full-time basis, or (B) independent 
        students, a reasonable portion of the allocation shall be made 
        available to such students;'';
            (2) in paragraph (5)--
                    (A) by striking ``provide that'' and inserting 
                ``(A) provide that'';
                    (B) by striking ``1993-1994'' and inserting ``1999-
                2000'';
                    (C) by inserting ``and'' after the semicolon; and
                    (D) by adding at the end the following:
            ``(B) provide that the Federal share of the compensation of 
        students employed in community service shall not exceed 90 
        percent;''; and
            (3) in paragraph (6), by striking ``, and to make'' and all 
        that follows through ``such employment''.

SEC. 443. WORK COLLEGES.

    Section 448 (20 U.S.C. 2756b) is amended--
            (1) in subsection (b)(2)--
                    (A) in subparagraph (C), by striking ``and'' after 
                the semicolon;
                    (B) in subparagraph (D)(ii), by striking the period 
                and inserting a semicolon; and
                    (C) by adding at the end the following:
                    ``(E) coordinate and carry out joint projects and 
                activities to promote work service learning; and
                    ``(F) carry out a comprehensive, longitudinal study 
                of student academic progress and academic and career 
                outcomes, relative to student self-sufficiency in 
                financing their higher education, repayment of student 
                loans, continued community service, kind and quality of 
                service performed, and career choice and community 
                service selected after graduation.''; and
            (2) in subsection (f), by striking ``$5,000,000 for fiscal 
        year 1993'' and inserting ``$7,000,000 for fiscal year 1999''.

          PART D--WILLIAM D. FORD FEDERAL DIRECT LOAN PROGRAM

SEC. 451. SELECTION OF INSTITUTIONS.

    Section 453(c) (20 U.S.C. 1087c(c)) is amended--
            (1) in paragraph (2)--
                    (A) in the paragraph heading, by striking 
                ``Transition'';
                    (B) by striking subparagraph (E); and
                    (C) by redesignating subparagraphs (F), (G), and 
                (H) as subparagraphs (E), (F), and (G), respectively; 
                and
            (2) in paragraph (3)--
                    (A) in the paragraph heading, by striking ``After 
                transition''; and
                    (B) by striking ``For academic year 1995-1996 and 
                subsequent academic years, the'' and inserting ``The''.

SEC. 452. TERMS AND CONDITIONS.

    (a) Interest Rates.--Section 455(b) (20 U.S.C. 1087e(b)) is amended 
to read as follows:
    ``(b) Interest Rate.--
            ``(1) Rates for fdsl and fdusl.--For Federal Direct 
        Stafford/Ford Loans and Federal Direct Unsubsidized Stafford/
        Ford Loans for which the first disbursement is made on or after 
        July 1, 1998, the applicable rate of interest shall, during any 
        12-month period beginning on July 1 and ending on June 30, be 
        determined on the preceding June 1 and be equal to--
                    ``(A) the bond equivalent rate of 91-day Treasury 
                bills auctioned at the final auction held prior to such 
                June 1; plus
                    ``(B) 2.3 percent,
        except that such rate shall not exceed 8.25 percent.
            ``(2) In school and grace period rules.--With respect to 
        any Federal Direct Stafford/Ford Loan or Federal Direct 
        Unsubsidized Stafford/Ford Loan for which the first 
        disbursement is made on or after July 1, 1995, the applicable 
        rate of interest for interest which accrues--
                    ``(A) prior to the beginning of the repayment 
                period of the loan; or
                    ``(B) during the period in which principal need not 
                be paid (whether or not such principal is in fact paid) 
                by reason of a provision described in section 
                428(b)(1)(M) or 427(a)(2)(C),
        shall be determined under paragraph (1) by substituting `1.7 
        percent' for `2.3 percent'.
            ``(3) PLUS loans.--With respect to Federal Direct PLUS Loan 
        for which the first disbursement is made on or after July 1, 
        1998, the applicable rate of interest shall be determined under 
        paragraph (1)--
                    ``(A) by substituting `3.1 percent' for `2.3 
                percent'; and
                    ``(B) by substituting `9.0 percent' for `8.25 
                percent'.
            ``(4) Publication.--The Secretary shall determine the 
        applicable rates of interest under this subsection after 
        consultation with the Secretary of the Treasury and shall 
        publish such rate in the Federal Register as soon as 
        practicable after the date of determination.''.
    (b) Effective Date.--The amendments made by this section shall 
apply with respect to any loan made under part D of title IV of the 
Higher Education Act of 1965 for which the first disbursement is made 
on or after July 1, 1998.

SEC. 453. CONTRACTS.

    Section 456(b) (20 U.S.C. 1087f(b)) is amended--
            (1) in paragraph (3), by inserting ``and'' after the 
        semicolon;
            (2) by striking paragraph (4); and
            (3) by redesignating paragraph (5) as paragraph (4).

SEC. 454. FUNDS FOR ADMINISTRATIVE EXPENSES.

    Section 458 (20 U.S.C. 1087h) is amended--
            (1) by amending subsection (a) to read as follows:
    ``(a) Administrative Expenses.--
            ``(1) In general.--Each fiscal year there shall be 
        available to the Secretary, from funds not otherwise 
        appropriated, funds to be obligated for--
                    ``(A) administrative costs under this part and part 
                B, including the costs of the direct student loan 
                programs under this part; and
                    ``(B) account maintenance fees payable to guaranty 
                agencies under part B and calculated in accordance with 
                paragraph (2), not to exceed (from such funds not 
                otherwise appropriated) $626,000,000 in fiscal year 
                1999, $726,000,000 in fiscal year 2000, $770,000,000 in 
                fiscal year 2001, $780,000,000 in fiscal year 2002, and 
                $795,000,000 in fiscal year 2003.
            ``(2) Account maintenance fees.--Account maintenance fees 
        under subparagraph (B) shall be paid quarterly and deposited in 
        the Agency Operating Fund established under section 422B.
            ``(3) Carryover.--The Secretary may carry over funds made 
        available under this section to a subsequent fiscal year.''; 
        and
            (2) by amending subsection (b) to read as follows:
    ``(b) Calculation Basis.--Account maintenance fees payable to 
guaranty agencies under paragraph (1)(B) shall be calculated--
            ``(1) for fiscal years 1999 and 2000, on the basis of 0.12 
        percent of the original principal amount of outstanding loans 
        on which insurance was issued under part B; and
            ``(2) for fiscal year 2001, 2002, and 2003, on the basis of 
        0.10 percent of the original principal amount of outstanding 
        loans on which insurance was issued under part B.''.

SEC. 455. LOAN CANCELLATION FOR TEACHERS.

    Part D of title IV (20 U.S.C. 1087a et seq.) is amended by adding 
at the end the following:

``SEC. 459. LOAN CANCELLATION FOR TEACHERS.

    ``(a) Statement of Purpose.--It is the purpose of this section to 
encourage individuals to enter and continue in the teaching profession.
    ``(b) Program Authorized.--The Secretary is authorized to carry out 
a program of canceling the obligation to repay a Federal Direct 
Stafford/Ford Loan made under this part that is eligible for an 
interest subsidy, for any new borrower on or after the date of 
enactment of the Higher Education Amendments of 1998, who--
            ``(1) has been employed as a full-time teacher for 3 
        consecutive complete school years--
                    ``(A) in a school that qualifies under section 
                465(a)(2)(A) for loan cancellation for Perkins loan 
                recipients who teach in such schools;
                    ``(B) if employed as a secondary school teacher, is 
                teaching a subject area that is relevant to the 
                borrower's academic major as certified by the chief 
                administrative officer of the public or non-profit 
                private secondary school in which the borrower is 
                employed; and
                    ``(C) if employed as an elementary school teacher, 
                has demonstrated, in accordance with State teacher 
                certification or licensing requirements and as 
                certified by the chief administrative officer of the 
                public or nonprofit private elementary school in which 
                the borrower is employed, knowledge and teaching skills 
                in reading, writing, mathematics and other areas of the 
                elementary school curriculum; and
            ``(2) is not in default on a loan for which the borrower 
        seeks forgiveness.
    ``(c) Regulations.--The Secretary is authorized to issue such 
regulations as may be necessary to carry out the provisions of this 
section.
    ``(d) Loan Cancellation During Continuing Teaching Service.--
            ``(1) In general.--The Secretary shall cancel the 
        obligation to repay--
                    ``(A) 30 percent of the total outstanding amount 
                and applicable interest of subsidized Federal Direct 
                Stafford/Ford loans owed by the student borrower after 
                the completion of the fourth or fifth complete school 
                year of service described in subsection (b);
                    ``(B) 40 percent of such total amount after the 
                completion of the sixth complete school year of such 
                service; and
                    ``(C) a total amount for any borrower that shall 
                not exceed $ 10,000.
            ``(2) Construction.--Nothing in this section shall be 
        construed to authorize any refunding of any canceled loan.
    ``(e) List.--If the list of schools in which a teacher may perform 
service pursuant to subsection (b) is not available before May 1 of any 
year, the Secretary may use the list for the year preceding the year 
for which the determination is made to make such service determination.
    ``(f) Continued Eligibility.--Any teacher who performs service in a 
school that--
            ``(1) meets the requirements of subsection (b)(1)(A) in any 
        year during such service; and
            ``(2) in a subsequent year fails to meet the requirements 
        of such subsection, may continue to teach in such school and 
        shall be eligible for loan cancellation pursuant to subsection 
        (b).''.

                     PART E--FEDERAL PERKINS LOANS

SEC. 461. AUTHORIZATION OF APPROPRIATIONS.

    Subsection (b) of section 461 (20 U.S.C. 1087aa) is amended by 
striking ``1993'' and inserting ``1999''.

SEC. 462. ALLOCATION OF FUNDS.

    (a) Amendments.--Section 462 (20 U.S.C. 1087bb) is amended--
            (1) in the matter preceding subparagraph (A) of subsection 
        (d)(3), by striking ``the Secretary, for'' and all that follows 
        through ``years,'';
            (2) by amending subsection (f) to read as follows:
    ``(f) Default Penalties.--
            ``(1) In general.--For fiscal year 1998 and any succeeding 
        fiscal year, any institution with a cohort default rate (as 
        defined under subsection (h)) that equals or exceeds 25 percent 
        shall have a default penalty of zero.
            ``(2) Ineligibility.--
                    ``(A) In general.--For fiscal year 1998 and any 
                succeeding fiscal year, any institution with a cohort 
                default rate (as defined in subsection (h)) that equals 
                or exceeds 50 percent for each of the 3 most recent 
                years for which data are available shall not be 
                eligible to participate in a program under this part 
                for the fiscal year for which the determination is made 
                and the 2 succeeding fiscal years, unless, within 30 
                days of receiving notification from the Secretary of 
                the loss of eligibility under this paragraph, the 
                institution appeals the loss of eligibility to the 
                Secretary. The Secretary shall issue a decision on any 
                such appeal within 45 days after the submission of the 
                appeal. Such decision may permit the institution to 
                continue to participate in a program under this part 
                if--
                            ``(i) the institution demonstrates to the 
                        satisfaction of the Secretary that the 
                        Secretary's calculation of the institution's 
                        cohort default rate is not accurate, and that 
                        recalculation would reduce the institution's 
                        cohort default rate for any of the 3 fiscal 
                        years below 50 percent; or
                            ``(ii) there are, in the judgment of the 
                        Secretary, exceptional mitigating circumstances 
                        such as a small number of borrowers entering 
                        repayment, that would make the application of 
                        this subparagraph inequitable.
                    ``(B) Continued participation.--During an appeal 
                under subparagraph (A), the Secretary may permit the 
                institution to continue to participate in a program 
                under this part.
                    ``(C) Definition.--For the purposes of subparagraph 
                (A), the term `loss of eligibility' shall be defined as 
                the mandatory liquidation of an institution's student 
                loan fund, and assignment of the institution's 
                outstanding loan portfolio to the Secretary.'';
            (3) by amending paragraph (1) of subsection (g) to read as 
        follows: ``(1) For award year 1998 and subsequent years, the 
        maximum cohort default rate is 25 percent.''; and
            (4) in subsection (h)--
                    (A) in the subsection heading, by striking 
                ``Definitions of Default Rate and'' and inserting 
                ``Definition of'';
                    (B) by striking paragraphs (1) and (2);
                    (C) by redesignating paragraphs (3) and (4) as 
                paragraphs (1) and (2), respectively;
                    (D) in paragraph (1) (as redesignated by 
                subparagraph (C)--
                            (i) by striking subparagraph (B); and
                            (ii) by redesignating subparagraphs (C) 
                        through (G) as subparagraphs (B) through (F), 
                        respectively; and
                    (E) in the matter preceding subparagraph (A) of 
                paragraph (2) (as redesignated by subparagraph (C)), by 
                striking ``A loan'' and inserting ``For purposes of 
                calculating the cohort default rate under this 
                subsection, a loan''.
    (b) Conforming Amendments.--Section 462 (20 U.S.C. 1087bb) is 
amended--
            (1) in the matter following paragraphs (1)(B) and 
        (2)(D)(ii) of subsection (a), by inserting ``cohort'' before 
        ``default'' each place the term appears;
            (2) in the matter following paragraphs (2)(B) and (3)(C) of 
        subsection (c), by inserting ``cohort'' before ``default'' each 
        place the term appears;
            (3) in subsection (e)(2), by inserting ``cohort'' before 
        ``default''; and
            (4) in subsection (h)(1)(F) (as redesignated by 
        subparagraphs (C) and (D)(ii) of subsection (a)(4)), by 
        inserting ``cohort'' before ``default''.

SEC. 463. AGREEMENTS WITH INSTITUTIONS OF HIGHER EDUCATION.

    Section 463 (20 U.S.C. 1087cc) is amended--
            (1) by amending subparagraph (B) of subsection (a)(2) to 
        read as follows:
                    ``(B) a capital contribution by an institution in 
                an amount equal to one-third of the Federal capital 
                contributions described in subparagraph (A);'';
            (2) in subsection (c)--
                    (A) in paragraph (2)--
                            (i) in the matter preceding subparagraph 
                        (A), by striking ``by the Secretary'' and all 
                        that follows through ``of--'' and inserting 
                        ``by the Secretary or an institution, as the 
                        case may be, to such organizations, with 
                        respect to any loan held by the Secretary or 
                        the institution, respectively, of--'';
                            (ii) by amending subparagraph (A) to read 
                        as follows:
                    ``(A) the date of disbursement and the amount of 
                such loans made to any borrower under this part at the 
                time of disbursement of the loan;'';
                            (iii) in subparagraph (B)--
                                    (I) by inserting ``the repayment 
                                and'' after ``concerning''; and
                                    (II) by striking ``any defaulted'' 
                                and inserting ``such''; and
                            (iv) in subparagraph (C), by inserting ``, 
                        or upon cancellation or discharge of the 
                        borrower's obligation on the loan for any 
                        reason'' before the period;
                    (B) in paragraph (3)--
                            (i) in the matter preceding subparagraph 
                        (A), by striking ``until--'' and inserting 
                        ``until the loan is paid in full.''; and
                            (ii) by striking subparagraphs (A) and (B); 
                        and
                    (C) by amending paragraph (4) to read as follows:
            ``(4)(A) Except as provided in subparagraph (B), an 
        institution of higher education, after consultation with the 
        Secretary and pursuant to the agreements entered into under 
        paragraph (1), shall disclose at least annually to any credit 
        bureau organization with which the Secretary has such an 
        agreement the information set forth in paragraph (2), and shall 
        disclose promptly to such credit bureau organization any 
        changes to the information previously disclosed.
            ``(B) The Secretary may promulgate regulations establishing 
        criteria under which an institution of higher education may 
        cease reporting the information described in paragraph (2) 
        before a loan is paid in full.''.

SEC. 464. TERMS OF LOANS.

    Section 464 (20 U.S.C. 1087dd) is amended--
            (1) in subsection (a), by amending paragraph (2) to read as 
        follows:
            ``(2)(A) Except as provided in paragraph (4), the total of 
        loans made to a student in any academic year or its equivalent 
        by an institution of higher education from a loan fund 
        established pursuant to an agreement under this part shall not 
        exceed--
                    ``(i) $4,000, in the case of a student who has not 
                successfully completed a program of undergraduate 
                education; or
                    ``(ii) $6,000, in the case of a graduate or 
                professional student (as defined in regulations issued 
                by the Secretary).
            ``(B) Except as provided in paragraph (4), the aggregate of 
        the loans for all years made to a student by institutions of 
        higher education from loan funds established pursuant to 
        agreements under this part may not exceed--
                    ``(i) $40,000, in the case of any graduate or 
                professional student (as defined by regulations issued 
                by the Secretary, and including any loans from such 
                funds made to such person before such person became a 
                graduate or professional student);
                    ``(ii) $20,000, in the case of a student who has 
                successfully completed 2 years of a program of 
                education leading to a bachelor's degree but who has 
                not completed the work necessary for such a degree 
                (determined under regulations issued by the Secretary, 
                and including any loans from such funds made to such 
                person before such person became such a student); and
                    ``(iii) $8,000, in the case of any other student.
            ``(C)(i) The total of loans made to a student described in 
        clause (ii) in any academic year or its equivalent by an 
        institution of higher education from loan funds established 
        pursuant to agreements under this part may not exceed--
                    ``(I) $8,000 for each of the third and fourth years 
                of the program of instruction leading to a bachelor's 
                degree; or
                    ``(II) $10,000 for the first year of graduate study 
                (as defined in regulations issued by the Secretary).
            ``(ii) A student referred to in clause (i) is any student--
                    ``(I) who is a junior in a program of instruction 
                leading to a bachelor's degree;
                    ``(II) who states in writing that the student will 
                pursue a course of study to become an elementary or 
                secondary school teacher; and
                    ``(III) who states in writing that the student 
                intends to become a full-time teacher in a school which 
                meets the requirements of section 465(a)(2)(A).
            ``(iii) Each institution shall provide a report to the 
        Secretary annually containing the number of loans under this 
        subparagraph that are made, the amount of each loan, and 
        whether students benefiting from the higher loan limits met the 
        requirements for receiving those loans.
            ``(iv) If 3 years after the date of enactment of the Higher 
        Education Amendments of 1998, the Secretary determines that an 
        institution has engaged in a pattern of abuse of this 
        subparagraph, the Secretary may reduce or terminate the 
        institution's Federal capital contribution.'';
            (2) in subsection (b), by amending paragraph (2) to read as 
        follows:
            ``(2) If the institution's capital contribution under 
        section 462 is directly or indirectly based in part on the 
        financial need demonstrated by students who are (A) attending 
        the institution less than full time; or (B) independent 
        students, a reasonable portion of the loans made from the 
        institution's student loan fund containing the contribution 
        shall be made available to such students.'';
            (3) in subsection (c)(1)--
                    (A) in subparagraph (D), by striking ``(i) 3 
                percent'' and all that follows through ``or (iii)'';
                    (B) by redesignating subparagraphs (H) and (I) as 
                subparagraphs (I) and (J), respectively; and
                    (C) by inserting after subparagraph (G) the 
                following:
                    ``(H) shall provide that, in the case of a loan 
                made on or after July 1, 1999, the loan shall be 
                considered in default (except as otherwise provided in 
                section 462(h)) if the borrower of a loan made under 
                this part fails to make an installment payment when 
                due, or to meet any other term of the promissory note 
                or written repayment agreement, and such failure 
                persists for--
                            ``(i) 180 days in the case of a loan that 
                        is repayable in monthly installments; or
                            ``(ii) 240 days in the case of a loan that 
                        is repayable in less frequent installments;''; 
                        and
            (4) by adding at the end the following:
    ``(g) Discharge.--
            ``(1) In general.--If a student borrower who received a 
        loan made under this part on or after January 1, 1986, is 
        unable to complete the program in which such student is 
        enrolled due to the closure of the institution, then the 
        Secretary shall discharge the borrower's liability on the loan 
        (including the interest and collection fees) by repaying the 
        amount owed on the loan and shall subsequently pursue any claim 
        available to such borrower against the institution and the 
        institution's affiliates and principals, or settle the loan 
        obligation pursuant to the financial responsibility standards 
        described in section 498(c).
            ``(2) Assignment.--A borrower whose loan has been 
        discharged pursuant to this subsection shall be deemed to have 
        assigned to the United States the right to a loan refund in an 
        amount that does not exceed the amount discharged against the 
        institution and the institution's affiliates and principals.
            ``(3) Eligibility for additional assistance.--The period 
        during which a student was unable to complete a course of study 
        due to the closing of the institution shall not be considered 
        for purposes of calculating the student's period of eligibility 
        for additional assistance under this title.
            ``(4) Special rule.--A borrower whose loan has been 
        discharged pursuant to this subsection shall not be precluded, 
        because of that discharge, from receiving additional grant, 
        loan, or work assistance under this title for which the 
        borrower would be otherwise eligible (but for the default on 
        the discharged loan). The amount discharged under this 
        subsection shall not be considered income for purposes of the 
        Internal Revenue Code of 1986.
            ``(5) Reporting.--The Secretary or institution, as the case 
        may be, shall report to credit bureaus with respect to loans 
        that have been discharged pursuant to this subsection.
    ``(h) Rehabilitation of Loans.--
            ``(1) Rehabilitation.--
                    ``(A) In general.--If the borrower of a loan made 
                under this part who has defaulted on the loan makes 12 
                ontime, consecutive, monthly payments of amounts owed 
                on the loan, as determined by the institution, the loan 
                shall be considered rehabilitated, and the institution 
                that made that loan (or the Secretary, in the case of a 
                loan held by the Secretary) shall instruct any credit 
                bureau organization or credit reporting agency to which 
                the default was reported to remove the default from the 
                borrower's credit history.
                    ``(B) Comparable conditions.--As long as the 
                borrower continues to make scheduled repayments on a 
loan rehabilitated under this paragraph, the rehabilitated loan shall 
be subject to the same terms and conditions, and qualify for the same 
benefits and privileges, as other loans made under this part.
                    ``(C) Additional assistance.--The borrower of a 
                rehabilitated loan shall not be precluded by section 
                484 from receiving additional grant, loan, or work 
                assistance under this title (for which the borrower is 
                otherwise eligible) on the basis of defaulting on the 
                loan prior to such rehabilitation.
                    ``(D) Limitations.--A borrower only once may obtain 
                the benefit of this paragraph with respect to 
                rehabilitating a loan under this part.
            ``(2) Restoration of eligibility.--If the borrower of a 
        loan made under this part who has defaulted on that loan makes 
        6 ontime, consecutive, monthly payments of amounts owed on such 
        loan, the borrower's eligibility for grant, loan, or work 
        assistance under this title shall be restored. A borrower only 
        once may obtain the benefit of this paragraph with respect to 
        restored eligibility.
    ``(i) Incentive Repayment Program.--
            ``(1) In general.--Each institution of higher education may 
        establish, with the approval of the Secretary, an incentive 
        repayment program designed to reduce default and to replenish 
        student loan funds established under this part. Each such 
        incentive repayment program may--
                    ``(A) offer a reduction of the interest rate on a 
                loan on which the borrower has made 48 consecutive 
                monthly repayments, but in no event may the rate be 
                reduced by more than 1 percent;
                    ``(B) provide for a discount on the balance owed on 
                a loan on which the borrower pays the principal and 
                interest in full prior to the end of the applicable 
                repayment period, but in no event may the discount 
                exceed 5 percent of the unpaid principal balance due on 
                the loan at the time the early repayment is made; and
                    ``(C) include such other incentive repayment 
                options as the institution determines will carry out 
                the objectives of this subsection.
            ``(2) Limitation.--No incentive repayment option under an 
        incentive repayment program authorized by this subsection may 
        be paid for with Federal funds, including any Federal funds 
        from the student loan fund, nor can an incentive repayment 
        option be paid for with institutional funds from the student 
        loan fund.''.

SEC. 465. DISTRIBUTION OF ASSETS FROM STUDENT LOAN FUNDS.

    Section 466 (20 U.S.C. 1087ff) is amended--
            (1) in subsection (a)--
                    (A) in the matter preceding paragraph (1)--
                            (i) by striking ``1996'' and inserting 
                        ``2003''; and
                            (ii) by striking ``1997'' and inserting 
                        ``2004''; and
                    (B) in paragraph (1), by striking ``1996'' and 
                inserting ``2003'';
            (2) in subsection (b)--
                    (A) by striking ``2005'' and inserting ``2012''; 
                and
                    (B) by striking ``1996'' and inserting ``2003''; 
                and
            (3) in subsection (c), by striking ``1997'' and inserting 
        ``2004''.

SEC. 466. PERKINS REVOLVING FUND.

    (a) Repeal.--Section 467 (20 U.S.C. 1087gg) is repealed.
    (b) Transfer of Balance.--Any funds in the Perkins Revolving Loan 
Fund on the date of enactment of this Act shall be transferred to and 
deposited in the Treasury.

                         PART F--NEED ANALYSIS

SEC. 471. COST OF ATTENDANCE.

    Section 472 (20 U.S.C. 1087ll) is amended--
            (1) in paragraph (3)--
                    (A) in subparagraph (A), by striking ``of not less 
                than $1,500'' and inserting ``determined by the 
                institution''; and
                    (B) in subparagraph (C), by striking ``, except 
                that the amount may not be less than $2,500''; and
            (2) in paragraph (11), by striking ``placed'' and inserting 
        ``engaged''.

SEC. 472. FAMILY CONTRIBUTION FOR DEPENDENT STUDENTS.

    Section 475 (20 U.S.C. 1087oo) is amended--
            (1) in subsection (g)--
                    (A) in paragraph (2)--
                            (i) in subparagraph (D)--
                                    (I) by striking ``$1,750'' and 
                                inserting ``$2,200''; and
                                    (II) by striking ``and'' after the 
                                semicolon;
                            (ii) in subparagraph (E), by striking the 
                        period and inserting ``; and''; and
                            (iii) by adding at the end the following:
                    ``(F) an allowance for parents' negative available 
                income, determined in accordance with paragraph (6).''; 
                and
                    (B) by adding at the end the following:
            ``(6) Allowance for parents' negative available income.--
        The allowance for parents' negative available income is the 
        negative amount, if any, remaining after all allowances have 
        been subtracted from parents' total income under subsection 
        (c)(1).''; and
            (2) by adding at the end the following:
    ``(j) Adjustments to Students Contribution for Enrollment Periods 
of Less Than Nine Months.--For periods of enrollment of less than 9 
months, the student's contribution from adjusted available income (as 
determined under subsection (g)) is determined, for purposes other than 
subpart 2 of part A, by dividing the amount determined under such 
subsection by 9, and multiplying the result by the number of months in 
the period of enrollment.''.

SEC. 473. FAMILY CONTRIBUTION FOR INDEPENDENT STUDENTS WITHOUT 
              DEPENDENTS OTHER THAN A SPOUSE.

    Section 476(b)(1)(A)(iv) (20 U.S.C. 1087pp(b)(1)(A)(iv)) is 
amended--
            (1) in subclause (I), by striking ``$3,000'' and inserting 
        ``$4,250'';
            (2) in subclause (II), by striking ``$3,000'' and inserting 
        ``$4,250''; and
            (3) in subclause (III), by striking ``$6,000'' and 
        inserting ``$7,250''.

SEC. 474. REGULATIONS; UPDATED TABLES AND AMOUNTS.

    Section 478(b) (20 U.S.C. 1087rr(b)) is amended--
            (1) by striking ``For each academic year'' and inserting 
        the following:
            ``(1) Revised tables.--For each academic year''; and
            (2) by adding at the end the following new paragraph:
            ``(2) Revised amounts.--For each academic year after 
        academic year 1997-1998, the Secretary shall publish in the 
        Federal Register revised income protection allowances for the 
        purpose of sections 475(g)(2)(D) and 476(b)(1)(A)(iv). Such 
        revised allowances shall be developed by increasing each of the 
        dollar amounts contained in such section by a percentage equal 
        to the estimated percentage increase in the Consumer Price 
        Index (as determined by the Secretary) between December 1996 
        and the December next preceding the beginning of such academic 
        year, and rounding the result to the nearest $10.''.

SEC. 475. REFUSAL OR ADJUSTMENT OF LOAN CERTIFICATIONS.

    Subsection (c) of section 479A (20 U.S.C. 1087tt) is amended to 
read as follows:
    ``(c) Refusal or Adjustment of Loan Certifications.--An eligible 
institution may refuse to certify a statement that permits a student to 
receive a loan under part B, or refuse to make a loan under part D, or 
may certify a loan amount or make a loan that is less than the 
student's determination of need (as determined under this part), if the 
reason for the action is documented and provided in written form to the 
student. No eligible institution shall discriminate against any 
borrower or applicant in obtaining a loan on the basis of race, 
national origin, religion, sex, marital status, age, or disability 
status.''.

                       PART G--GENERAL PROVISIONS

SEC. 481. MASTER CALENDAR.

    Section 482 (20 U.S.C. 1089) is amended--
            (1) in subsection (a), by adding at the end the following:
            ``(3) To the extent feasible, the Secretary shall notify 
        eligible institutions and vendors by December 1 prior to the 
        start of an award year of minimal hardware and software 
        requirements necessary to administer programs under this 
        title.''; and
            (2) by amending subsection (c) to read as follows:
    ``(c) Delay of Effective Date of Late Publications.--(1) Except as 
provided in paragraph (2), any regulatory changes initiated by the 
Secretary affecting the programs under this title that have not been 
published in final form by November 1 prior to the start of the award 
year shall not become effective until the beginning of the second award 
year after such November 1 date.
    ``(2)(A) The Secretary may designate any regulatory provision that 
affects the programs under this title and is published in final form 
after November 1 as one that an entity subject to the provision may, in 
the entity's discretion, choose to implement prior to the effective 
date described in paragraph (1). The Secretary may specify in the 
designation when, and under what conditions, an entity may implement 
the provision prior to that effective date. The Secretary shall publish 
any designation under this subparagraph in the Federal Register.
    ``(B) If an entity chooses to implement a regulatory provision 
prior to the effective date described in paragraph (1), as permitted by 
subparagraph (A), the provision shall be effective with respect to that 
entity in accordance with the terms of the Secretary's designation.''.

SEC. 482. FORMS AND REGULATIONS.

    Section 483 (20 U.S.C. 1090) is amended--
            (1) in subsection (a)--
                    (A) in the subsection heading, by striking ``Form'' 
                and inserting ``Form Development'';
                    (B) by amending paragraph (1) to read as follows:
            ``(1) Single form requirements.--The Secretary, in 
        cooperation with representatives of agencies and organizations 
        involved in student financial assistance, shall produce, 
        distribute, and process free of charge a common financial 
        reporting form (which shall include electronic versions of the 
        form) to be used--
                    ``(A) to determine the need (including the expected 
                family contribution and, if appropriate, cost of 
                attendance) and eligibility of a student for financial 
assistance under parts A, C, D, and E; and
                    ``(B) to determine the need (including the expected 
                family contribution and cost of attendance) of a 
                student for the purposes of part B.
            ``(2) State data items.--The Secretary shall include on the 
        form developed under this subsection such data items, selected 
        in consultation with the States to assist the States in 
        awarding State student financial assistance, as the Secretary 
        determines are appropriate for inclusion.
            ``(3) Parent's social security number.--The Secretary shall 
        include on the form developed under this paragraph space for 
        the social security number of parents of dependent students 
        seeking financial assistance under this title.
            ``(4) Use.--The Secretary shall require that the form 
        developed under this paragraph be used for the purpose of 
        collecting eligibility and other data for purposes of part B, 
        including the applicant's choice of lender.''; and
                    (C) in paragraph (3)--
                            (i) by striking ``Institutions of higher 
                        education and States shall receive'' and 
                        inserting ``The Secretary shall provide''; and
                            (ii) by striking ``by the Secretary''; and
            (2) by adding at the end the following:
    ``(g) Payment for Data.--The Secretary may pay such charges as the 
Secretary determines are necessary to obtain data that the Secretary 
considers essential to the efficient administration of the programs 
under this title.
    ``(h) Multiyear Promissory Note.--The Secretary shall require, for 
loans made under this title for periods of enrollment beginning on or 
after July 1, 2000, the use of a promissory note applicable to more 
than 1 academic year, or more than 1 type of loan made under this 
title. Prior to implementing this subsection, the Secretary shall 
develop and test such a promissory note on a limited or pilot basis.''.

SEC. 483. STUDENT ELIGIBILITY.

    Section 484 (20 U.S.C. 1091) is amended--
            (1) in subsection (d)--
                    (A) in the matter preceding paragraph (1), by 
                striking ``either''; and
                    (B) by adding at the end the following:
            ``(3) The student has completed a high school education in 
        a home school setting and has met any State requirements with 
        respect to such education in a home school setting.''; and
            (2) by adding at the end the following:
    ``(q) Verification of IRS Return Information.--The Secretary shall 
verify the information reported by all applicants for assistance on the 
form prescribed under section 483 with the return information (as 
defined in section 6103 of the Internal Revenue Code of 1986) available 
to the Secretary of the Treasury. Notwithstanding section 6103 of such 
Code the Secretary of the Treasury shall provide the return information 
to the Secretary. In the case of a dependent student the return 
information shall include the return information of the parent of the 
student. The form prescribed by the Secretary under section 483 shall 
contain a prominent notice of the verification of the information and a 
warning to all the applicants of the penalties for misrepresentation, 
with respect to the information, under the United States Code.

SEC. 484. INSTITUTIONAL REFUNDS.

    Section 484B (20 U.S.C. 1091b) is amended--
            (1) in subsection (b)--
                    (A) in paragraph (1), by inserting ``or'' after the 
                semicolon;
                    (B) by striking paragraph (2); and
                    (C) by redesignating paragraph (3) as paragraph 
                (2); and
            (2) in subsection (c)--
                    (A) in paragraph (1), by striking ``last day of 
                attendance by the student'' and inserting ``day the 
                student withdrew'';
                    (B) in subparagraph (A) of paragraph (2), by 
                striking ``last recorded day of attendance by the 
                student'' and inserting ``day the student withdrew''; 
                and
                    (C) by adding at the end the following:
            ``(3) For the purpose of this section, the term `day a 
        student withdrew'--
                    ``(A) is the date that was the last recorded day of 
                attendance by the student; or
                    ``(B) in instances where attendance is not 
                recorded, is the date on which--
                            ``(i) the student began the withdrawal 
                        process prescribed by the institution; or
                            ``(ii) the student otherwise provided 
                        notification to the institution of the intent 
                        to withdraw.''.

SEC. 485. INSTITUTIONAL AND FINANCIAL ASSISTANCE INFORMATION FOR 
              STUDENTS.

    (a) Information Dissemination Activities.--Section 485(a) (20 
U.S.C. 1092(a)) is amended--
            (1) in paragraph (1)--
                    (A) in the second sentence, by striking ``and 
                mailings, to all current'' and inserting ``, mailings, 
                and electronic media, to all enrolled''; and
                    (B) by inserting after the second sentence the 
                following: ``Each eligible institution annually shall 
                provide to all students enrolled at the institution, a 
                list of the information that is required by this 
                section, together with a statement of the procedures 
                required to obtain the information.'';
            (2) in paragraph (2), by inserting ``an application for'' 
        after ``concerning''; and
            (3) in paragraph (3)--
                    (A) in the matter preceding subparagraph (A)--
                            (i) by inserting ``(graduation rates)'' 
                        after ``this subsection''; and
                            (ii) by inserting ``(student right-to-
                        know)'' after ``subsection (e)''; and
                    (B) by amending subparagraph (A) to read as 
                follows:
                    ``(A) shall be made available by July 1 each year 
                to current and prospective students prior to enrolling 
                or entering into any financial obligation; and''.
    (b) Exit Counseling for Borrowers.--Section 485(b) (20 U.S.C. 
1092(b)) is amended--
            (1) in paragraph (1)(A), by striking ``(individually or in 
        groups)''; and
            (2) in paragraph (2), by adding at the end the following:
    ``(C) Nothing in this subsection shall be construed to prohibit an 
institution of higher education from utilizing electronic means to 
provide personalized exit counseling.''.
    (c) Disclosures Required With Respect to Athletically Related 
Student Aid.--Section 485(e) (20 U.S.C. 1092(e)) is amended--
            (1) by amending paragraph (2) to read as follows:
            ``(2) When an institution described in paragraph (1) offers 
        a potential student athlete athletically related student aid, 
        such institution shall provide to the student, the student's 
        parents, the student's guidance counselor, and the student's 
        coach the information contained in the report submitted by such 
        institution pursuant to paragraph (1). If the institution is a 
        member of a national collegiate athletic association that 
        compiles graduation rate data on behalf of its member 
        institutions, that the Secretary determines is substantially 
        comparable to the information described in the previous 
        sentence, the distribution of the compilation to all secondary 
        schools shall fulfill the responsibility of the institution to 
        provide the information to a prospective student athlete's 
        guidance counselor and coach.''; and
            (2) by amending paragraph (9) to read as follows:
            ``(9) The reports required by this subsection shall be due 
        each July 1 and shall cover the 1-year period ending August 31 
        of the preceding year.''.
    (d) Disclosure of Campus Security Policy and Campus Crime 
Statistics.--Section 485(f) (20 U.S.C. 1092(f)) is amended--
            (1) by amending subparagraph (F) of paragraph (1) to read 
        as follows:
                    ``(F) Statistics concerning the occurrence on 
                campus, during the most recent calendar year, and 
                during the 2 preceding calendar years for which data 
                are available--
                            ``(i) of the following criminal offenses 
                        reported to campus security authorities or 
                        local police agencies--
                                    ``(I) homicide, including murder or 
                                nonnegligent manslaughter or negligent 
                                manslaughter;
                                    ``(II) sex offenses, forcible or 
                                nonforcible;
                                    ``(III) robbery;
                                    ``(IV) aggravated assault;
                                    ``(V) burglary;
                                    ``(VI) motor vehicle theft; and
                                    ``(VII) arson;
                            ``(ii) of the crimes described in 
                        subclauses (I) through (VII), and vandalism and 
                        simple assault, that manifest evidence of 
                        prejudice based on actual or perceived race, 
                        gender, religion, sexual orientation, 
                        ethnicity, or disability that are reported to 
                        campus security authorities or local police 
                        agencies, which data shall be collected and 
                        reported according to category of prejudice.'';
            (2) by redesignating paragraphs (4) through (7) as 
        paragraphs (5) through (8), respectively;
            (3) by inserting after paragraph (3) the following:
            ``(4)(A) Each institution participating in any program 
        under this title which maintains either a police or security 
        department of any kind shall make, keep, and maintain a daily 
        log, written in a form that can be easily understood, recording 
        all crimes reported to such police or security department, 
        including--
                    ``(i) the nature, date, time, and general location 
                of each crime; and
                    ``(ii) the disposition of the complaint, if known.
            ``(B)(i) All entries that are required pursuant to this 
        paragraph shall, except where disclosure of such information is 
        prohibited by law or such disclosure would jeopardize the 
        confidentiality of the victim, be open to public inspection 
        within 2 business days of the initial report being made to the 
        department or a campus security authority.
            ``(ii) If new information about an entry into a log becomes 
        available to a police or security department, then the new 
        information shall be recorded in the log not later than 2 
        business days after the information becomes available to the 
        police or security department.
            ``(iii) Where there is clear and convincing evidence that 
        the release of such information would jeopardize an ongoing 
        criminal investigation or the safety of an individual, cause a 
        suspect to flee or evade detection, or result in the 
        destruction of evidence, such information may be withheld until 
        that damage is no longer likely to occur from the release of 
        such information.
            ``(iv) Notwithstanding clause (iii), an institution of 
        higher education shall record all criminal incidents occurring 
        on campus and shall make the reports open to public inspection 
        not later than 2 business days after the requirements of clause 
        (iii) are met.'';
            (4) in paragraph (7) (as redesignated by subparagraph (B)), 
        by inserting at the end the following: ``Such statistics shall 
        not identify victims of crimes or persons accused of crimes, 
        except as permitted by State or local law.''; and
            (5) by adding at the end the following:
            ``(9) Study.--
                    ``(A) In general.--The Secretary, in consultation 
                with the Attorney General, shall provide for a national 
                study to examine procedures undertaken after an 
                institution of higher education receives a report of 
                sexual assault.
                    ``(B) Report.--The study required by subparagraph 
                (A) shall include an analysis of--
                            ``(i) the existence and publication of the 
                        institution of higher education's and State's 
                        definition of sexual assault;
                            ``(ii) the existence and publication of the 
                        institution's policy for campus sexual 
                        assaults;
                            ``(iii) the individuals to whom reports of 
                        sexual assault are given most often and--
                                    ``(I) how the individuals are 
                                trained to respond to the reports; and
                                    ``(II) the extent to which the 
                                individuals are trained;
                            ``(iv) the reporting options that are 
                        articulated to the victim or victims of the 
                        sexual assault regarding--
                                    ``(I) on-campus reporting and 
                                procedure options; and
                                    ``(II) off-campus reporting and 
                                procedure options;
                            ``(v) the resources available for victims' 
                        safety, support, medical health, and 
                        confidentiality, including--
                                    ``(I) how well the resources are 
                                articulated both specifically to the 
                                victim of sexual assault and generally 
                                to the campus at large; and
                                    ``(II) the security of the 
                                resources in terms of confidentiality 
                                or reputation;
                            ``(vi) policies and practices that may 
                        prevent or discourage the reporting of campus 
                        sexual assaults to local crime authorities, or 
                        that may otherwise obstruct justice or 
                        interfere with the prosecution of perpetrators 
                        of campus sexual assaults;
                            ``(vii) policies and practices found 
                        successful in aiding the report and any ensuing 
                        investigation or prosecution of a campus sexual 
                        assault;
                            ``(viii) the on-campus procedures for 
                        investigation and disciplining the perpetrator 
                        of a sexual assault, including--
                                    ``(I) the format for collecting 
                                evidence; and
                                    ``(II) the format of the 
                                investigation and disciplinary 
                                proceeding, including the faculty 
                                responsible for running the 
                                disciplinary procedure and the persons 
                                allowed to attend the disciplinary 
                                procedure; and
                            ``(ix) types of punishment for offenders, 
                        including--
                                    ``(I) whether the case is directed 
                                outside for further punishment; and
                                    ``(II) how the institution punishes 
                                perpetrators.
                    ``(C) Submission of report.--The report required by 
                subparagraph (B) shall be submitted to Congress not 
                later than September 1, 1999.
                    ``(D) Definition.--For purposes of this section, 
                the term `campus sexual assaults' means sexual assaults 
                occurring at institutions of higher education and 
                sexual assaults committed against or by students or 
                employees of such institutions.
                    ``(E) Authorization of appropriations.--There is 
                authorized to be appropriated to carry out this section 
                $1,000,000 for fiscal year 1999.''.
    (e) Data Required.--Section 485(g) (20 U.S.C. 1092(g)) is amended--
            (1) in paragraph (1), by adding at the end the following:
                    ``(I)(i) The total revenues, and the revenues from 
                football, men's basketball, women's basketball, all 
                other men's sports combined, and all other women's 
                sports combined, derived by the institution from the 
                institution's intercollegiate athletics activities.
                    ``(ii) For the purpose of clause (i) revenues from 
                intercollegiate athletics activities allocable to a 
                sport shall include, without limitation, gate receipts, 
                broadcast revenues, appearance guarantees and options, 
                concessions and advertising, except that revenues such 
                as student activities fees or alumni contributions not 
                so allocable shall be included in the calculation of 
                total revenues only.
                    ``(J)(i) The total expenses, and the expenses 
                attributable to football, men's basketball, women's 
                basketball, all other men's sports combined and all 
                other women's sports combined, made by the institution 
                for the institution's intercollegiate athletics 
                activities.
                    ``(ii) For the purpose of clause (i) expenses for 
                intercollegiate athletics activities allocable to a 
                sport shall include without limitation grants-in-aid, 
                salaries, travel, equipment, and supplies, except that 
                expenses such as general and administrative overhead 
                not so allocable shall be included in the calculation 
                of total expenses only.
                    ``(K) A statement of any reduction that will, or is 
                likely to, occur during the ensuing 4 academic years in 
                the number of athletes that will be permitted to 
                participate in any collegiate sport, or in the 
                financial resources that the institution will make 
                available for any such sport, and the reasons for any 
                such reduction, to the extent the reduction is known at 
                the time of the preparation of the report.''; and
            (2) by striking paragraph (5).''.
    (f) GEPA Amendment.--Section 444(a)(4)(B) of the General Education 
Provisions Act (20 U.S.C. 1232g(a)(4)(B)) is amended--
            (1) by redesignating clauses (iii) and (iv) as clauses (iv) 
        and (v), respectively; and
            (2) by inserting after clause (ii) the following:
                            ``(iii) records that are maintained by 
                        local police or campus security officers of an 
                        educational agency or institution about--
                                    ``(I) individuals who have been 
                                found guilty of, or have pled guilty 
                                to, committing or participating in any 
                                criminal activity as defined in 
                                Federal, State, or local law that has 
                                occurred while the individual was a 
                                student in attendance, including audit 
                                or noncredit, at an educational 
                                institution; and
                                    ``(II) findings of guilt of 
                                criminal misconduct and related 
                                sanctions from any previously attended 
                                educational agencies or institutions 
                                where such records were created on or 
                                after September 1, 1999, and that are 
                                maintained by the institution currently 
                                or most recently attended by the 
                                individual;''.

SEC. 486. NATIONAL STUDENT LOAN DATA BANK SYSTEM.

    Section 485B (20 U.S.C. 1092b) is amended by adding at the end the 
following:
    ``(h) Student Status Confirmation Report.--In order to reduce 
unnecessary paperwork and to increase the efficient administration, the 
Secretary shall assure that borrowers under part E are included in the 
Student Status Confirmation Report in the same manner as borrowers 
under parts B and D.''.

SEC. 487. TRAINING IN FINANCIAL AID SERVICES.

    Section 486 (20 U.S.C. 1093) is amended to read as follows:

``SEC. 486. INFORMATION ON THE COSTS OF HIGHER EDUCATION.

    ``(a) In General.--For the purpose of providing comparative 
information to families about the costs of higher education--
            ``(1) the National Center for Education Statistics shall--
                    ``(A) develop a standard definition for the 
                following data elements:
                            ``(i) Tuition and fees.
                            ``(ii) Total cost of attendance, including 
                        costs such as housing, books, supplies, and 
                        transportation.
                            ``(iii) Average amount of financial 
                        assistance received by a student who attends an 
                        institution of higher education, in terms of 
                        the following:
                                    ``(I) Grants and loans.
                                    ``(II) Institutional and other 
                                assistance.
                            ``(iv) Percentage of students receiving 
                        student financial assistance, in terms of the 
                        following:
                                    ``(I) Grants and loans.
                                    ``(II) Institutional and other 
                                assistance;
                    ``(B) report the definitions to each institution of 
                higher education and the Committee on Labor and Human 
                Resources of the Senate and the Committee on Education 
                and the Workforce of the House of Representatives not 
                later than 90 days after the date of enactment of the 
                Higher Education Amendments of 1998;
                    ``(C) collect information regarding the data 
                elements described in subparagraph (A) with respect to 
                all institutions of higher education, and make 
                available the information each year in a timely fashion 
                through the integrated postsecondary education data 
                system, beginning with the information from the 1999-
                2000 academic year;
                    ``(D) provide the public notice when the 
                information described in subparagraph (C) is available 
                for public inspection; and
                    ``(E) publish in a timely fashion a report after 
                the third year of collection of the information 
                described in subparagraph (C) that compares the 
                information described in subparagraph (C) 
                longitudinally by institution, which information shall 
                be presented in a form that is easily understandable, 
                including clear definitions of the data elements 
                described in subparagraph (A), to allow parents and 
                students to make informed decisions about attending 
                college; and
            ``(2) institutions of higher education shall provide 
        information regarding each data element described in paragraph 
        (1)(A) to the National Center for Education Statistics by March 
        1 of each year, beginning in the year 2000.
    ``(b) Study.--
            ``(1) In general.--In consultation with the Bureau of Labor 
        Statistics, the National Center for Education Statistics shall 
        conduct a national study of expenditures at institutions of 
        higher education. Such study shall include information about--
                    ``(A) expenditures for--
                            ``(i) faculty salaries and benefits;
                            ``(ii) administrative salaries, benefits, 
                        and expenses;
                            ``(iii) academic support services;
                            ``(iv) research;
                            ``(v) construction; and
                            ``(vi) technology;
                    ``(B) how such expenditures change over time; and
                    ``(C) how such expenditures relate to college 
                costs.
            ``(2) Final report.--The National Center for Education 
        Statistics shall submit a report regarding the findings of the 
        study required by paragraph (1) to the Committee on Labor and 
        Human Resources of the Senate and the Committee on Education 
        and the Workforce of the House of Representatives not later 
        than September 30, 2001.
    ``(c) Higher Education Market Basket.--In consultation with the 
Bureau of Labor Statistics, the National Center for Education 
Statistics shall develop a Higher Education Market Basket that 
identifies the items that comprise the costs of higher education. The 
National Center for Education Statistics shall provide a report on the 
basket to the Committee on Labor and Human Resources of the Senate and 
the Committee on Education and the Workforce of the House of 
Representatives not later than September 30, 2002.''.

SEC. 488. PROGRAM PARTICIPATION AGREEMENTS.

    Section 487 (20 U.S.C. 1094) is amended--
            (1) in subsection (a)--
                    (A) in paragraph (3)--
                            (i) by striking subparagraph (B); and
                            (ii) by redesignating subparagraphs (C) and 
                        (D) as subparagraphs (B) and (C), respectively;
                    (B) in paragraph (9), by striking ``part B'' and 
                inserting ``part B or D'';
                    (C) in paragraph (14)--
                            (i) in subparagraph (A), by striking ``part 
                        B'' and inserting ``part B or D''; and
                            (ii) in subparagraph (B)--
                                    (I) by inserting ``for-profit'' 
                                after ``Any'';
                                    (II) by striking ``and any eligible 
                                institution which'' and inserting 
                                ``or''; and
                                    (III) by striking ``part B'' and 
                                inserting ``part B or D'';
                    (D) in paragraph (15), by striking ``State review 
                entities'' and inserting ``the State agencies''; and
                    (E) by amending paragraph (21) to read as follows:
            ``(21) The institution will meet the requirements 
        established by the Secretary and accrediting agencies or 
        associations, and will provide evidence to the Secretary that 
        the institution has the authority to operate within a State.''; 
        and
            (2) in subsection (c)--
                    (A) in paragraph (1)(A)(i), by striking ``State 
                review entities referred to in'' and inserting 
                ``appropriate State agency notifying the Secretary 
                under'';
                    (B) in paragraph (4), by striking ``, after 
                consultation with each State review entity designated 
                under subpart 1 of part H,''; and
                    (C) in paragraph (5), by striking ``State review 
                entities designated'' and inserting ``State agencies 
                notifying the Secretary''.

SEC. 489. REGULATORY RELIEF AND IMPROVEMENT.

    Section 487A (20 U.S.C. 1094a) is amended to read as follows:

``SEC. 487A. REGULATORY RELIEF AND IMPROVEMENT.

    ``(a) Quality Assurance Program.--
            ``(1) In general.--The Secretary is authorized to select 
        institutions for voluntary participation in a Quality Assurance 
        Program that provides participating institutions with an 
        alternative management approach through which individual 
        schools develop and implement their own comprehensive systems, 
        including processing and disbursement of student financial aid, 
        verification of student financial aid application data, and 
        entrance and exit interviews, thereby enhancing program 
        integrity within the student aid delivery system. The Quality 
        Assurance Program authorized by this section shall be based on 
        criteria that include demonstrated institutional performance, 
        as determined by the Secretary, and shall take into 
        consideration current quality assurance goals, as determined by 
        the Secretary.
            ``(2) Waiver.--The Secretary is authorized to waive for any 
        institution participating in the Quality Assurance Program any 
        regulations dealing with reporting or verification requirements 
        in this title that are addressed by the institution's 
        alternative management system, and may substitute such quality 
        assurance reporting as the Secretary determines necessary to 
        ensure accountability and compliance with the purposes of the 
        programs under this title.
            ``(3) Determination.--The Secretary is authorized to 
        determine--
                    ``(A) when an institution that is unable to 
                administer the Quality Assurance Program shall be 
                removed from such program; and
                    ``(B) when institutions desiring to cease 
                participation in such program will be required to 
                complete the current award year under the requirements 
                of the Quality Assurance Program.
            ``(4) Review and evaluation.--The Secretary shall review 
        and evaluate the Quality Assurance Program conducted by each 
        participating institution and, on the basis of that evaluation, 
        make recommendations regarding amendments to this Act that will 
        streamline the administration and enhance the integrity of 
        Federal student assistance programs. Such recommendations shall 
        be submitted to the Committee on Labor and Human Resources of 
        the Senate and the Committee on Education and the Workforce of 
        the House of Representatives.
    ``(b) Regulatory Improvement and Streamlining Experiments.--
            ``(1) In general.--The Secretary shall review and evaluate 
        the experience of institutions participating as experimental 
        sites during the period of 1993 through 1998 under this section 
        (as such section was in effect on the day before the date of 
        enactment of the Higher Education Amendments of 1998), and 
        shall submit a report based on this review and evaluation to 
        the Committee on Labor and Human Resources of the Senate and 
        the Committee on Education and the Workforce of the House of 
        Representatives not later than 6 months after the enactment of 
        the Higher Education Amendments of 1998. Such report shall 
        include--
                    ``(A) a list of participating institutions and the 
                specific statutory or regulatory waivers granted to 
                each institution;
                    ``(B) the findings and conclusions reached 
                regarding each of the experiments conducted; and
                    ``(C) recommendations for amendments to improve and 
                streamline this Act, based on the results of the 
                experiment.
            ``(2) Selection.--
                    ``(A) In general.--The Secretary is authorized to 
                select a limited number of institutions for voluntary 
                participation as experimental sites to provide 
                recommendations to the Secretary on the impact and 
                effectiveness of proposed regulations or new management 
                initiatives, except that additional institutions may 
                not be selected by the Secretary until the report 
                required by subsection (b)(1) has been submitted to 
                Congress.
                    ``(B) Consultation.--Prior to approving any 
                additional experimental sites, the Secretary shall 
                consult with the Committee on Labor and Human Resources 
                of the Senate and the Committee on Education and the 
                Workforce of the House of Representatives and shall 
                provide--
                            ``(i) a list of institutions proposed for 
                        participation in the experiment and the 
                        specific statutory or regulatory waivers 
                        proposed to be granted to each institution;
                            ``(ii) the objectives to be achieved 
                        through the experiment; and
                            ``(iii) the period of time over which the 
                        experiment is to be conducted.
                    ``(C) Waivers.--The Secretary is authorized to 
                waive, for any institution participating as an 
                experimental site under subparagraph (A), any 
                requirements in this title, or regulations prescribed 
                under this title, that will bias experimental results.
    ``(c) Definitions.--For purposes of this section, the term `current 
award year' is defined as the award year during which the participating 
institution indicates the institution's intention to cease 
participation.''.

SEC. 489A. DISTANCE EDUCATION DEMONSTRATION PROGRAMS.

    Part G (20 U.S.C. 1088 et seq.) is amended by inserting after 
section 487B (20 U.S.C. 1094a) the following:

``SEC. 487C. DISTANCE EDUCATION DEMONSTRATION PROGRAMS.

    ``(a) Purpose.--It is the purpose of this section--
            ``(1) to allow demonstration programs that are strictly 
        monitored by the Department to test the quality and viability 
        of expanded distance education programs currently restricted 
        under this Act;
            ``(2) to help determine the specific statutory and 
        regulatory requirements which should be altered to provide 
        greater access to high quality distance education programs; and
            ``(3) to help determine the appropriate level of Federal 
        assistance for students enrolled in distance education 
        programs.
    ``(b) Demonstration Programs Authorized.--
            ``(1) In general.--The Secretary, in accordance with the 
        provisions of subsection (d), is authorized to select 
        institutions of higher education or consortia of such 
        institutions for voluntary participation in a Distance 
        Education Demonstration Program that provides participating 
        institutions with the ability to offer distance education 
        programs that do not meet all or a portion of the sections or 
        regulations described in paragraph (2).
            ``(2) Waivers.--The Secretary is authorized to waive, for 
        any institution or consortia participating in a Distance 
        Education Demonstration Program, 1 or more of the requirements 
        of section 472(5) as the section relates to computer costs, 
        sections 472(10), 481(a)(3)(A), 481(a)(3)(B), 484(l)(1), or 1 
        or more of the regulations prescribed for distance education 
        under part F or G.
            ``(3) Special rule.--An institution of higher education, as 
        defined in section 481(a), is eligible to participate in the 
        demonstration program authorized under this section if such 
        institution awards a degree, except that--
                    ``(A) such institutions that are described in 
                section 481(a)(1)(C) shall not be eligible to 
                participate; and
                    ``(B) subject to subparagraph (A), such 
                institutions that meet the requirements of subsection 
                (a) of section 481, other than the requirements of 
                paragraph (3)(A) or (3)(B) of such subsection, shall be 
                eligible to participate.
    ``(c) Application.--
            ``(1) In general.--Each institution or consortia of 
        institutions desiring to participate in a demonstration program 
        under this section shall submit an application to the Secretary 
        at such time and in such manner as the Secretary may require.
            ``(2) Contents.--Each application shall include--
                    ``(A) a description of the institution or 
                consortium's consultation with a recognized accrediting 
                agency or association with respect to quality 
                assurances for the distance education programs to be 
                offered;
                    ``(B) a description of the statutory and regulatory 
                requirements described in subsection (b)(2) for which a 
                waiver is sought and the reasons for which the waiver 
                is sought;
                    ``(C) a description of the distance education 
                programs to be offered;
                    ``(D) a description of the students to whom 
                distance education programs will be offered;
                    ``(E) an assurance that the institution or 
                consortium will offer full cooperation with the ongoing 
                evaluations of the demonstration program provided for 
                in this section; and
                    ``(F) such other information as the Secretary may 
                require.
    ``(d) Selection.--The Secretary is authorized to select not more 
than 5 institutions or consortia to participate in the initial year of 
the demonstration program authorized under this section. If expansion 
of the demonstration program can be supported on the basis of the 
evaluations conducted pursuant to subsections (f) and (g), the 
Secretary may select not more than 10 additional institutions or 
consortia, taking into account the number and quality of applications 
received and the Department's capacity to oversee and monitor each 
demonstration program. To the extent feasible, the Secretary shall 
select a representative sample of institutions for participation. In 
selecting institutions for participation, the Secretary shall take into 
consideration the institution's financial and administrative capability 
and the type of program or programs being offered via distance 
education course offerings.
    ``(e) Notification.--The Secretary shall make available to the 
public and to the Committee on Labor and Human Resources of the Senate 
and the Committee on Education and the Workforce of the House of 
Representatives a list of institutions or consortia selected to 
participate in the demonstration program authorized by this section. 
Such notice shall include a listing of the specific statutory and 
regulatory requirements being waived for each institution or consortia 
and a description of the distance education courses to be offered.
    ``(f) Evaluations and Reports.--
            ``(1) Evaluation.--The Secretary, on an annual basis, shall 
        evaluate the demonstration programs authorized under this 
        section. Such evaluations shall specifically review--
                    ``(A) the number and types of students 
                participating in the programs being offered, including 
                the progress of participating students toward 
                recognized associate, bachelor's, or graduate degrees, 
                and the degree to which participation in such programs 
                increased;
                    ``(B) issues related to student financial 
                assistance for distance education; and
                    ``(C) the extent to which statutory or regulatory 
                requirements not waived under the demonstration program 
                present difficulties for students or institutions.
            ``(2) Policy analysis.--In addition, the Secretary shall 
        review current policies and identify those policies which 
        present impediments to the development and use of distance 
        learning and other nontraditional methods of expanding access 
        to education.
            ``(3) Reports.--
                    ``(A) In general.--Within 18 months of the 
                initiation of the demonstration program, the Secretary 
                shall report to the Committee on Labor and Human 
                Resources of the Senate and and the Committee on 
Education and the Workforce of the House of Representatives with 
respect to--
                            ``(i) the evaluations of the demonstration 
                        programs authorized under this section; and
                            ``(ii) any proposed statutory changes 
                        designed to enhance the use of distance 
                        education.
                    ``(B) Additional reports.--The Secretary shall 
                provide additional reports to the Committee on Labor 
                and Human Resources of the Senate and the Committee on 
                Education and the Workforce of the House of 
                Representatives on an annual basis regarding the 
                demonstration programs authorized under this section.
    ``(g) Independent Evaluation.--
            ``(1) In general.--The Secretary shall enter into a 
        contract with the National Academy of Sciences to study the 
        quality of and student learning outcomes in distance education 
        programs. Such study shall include--
                    ``(A) identification of the elements by which 
                quality in distance education can be assessed, such as 
                subject matter, interactivity, and student outcomes; 
                and
                    ``(B) identification of the types of students which 
                can most benefit from distance education in areas such 
                as access to higher education, persistence, and 
                graduation.
            ``(2) Scope.--Such study shall include distance education 
        programs offered by the institutions or consortia participating 
        in the demonstration program authorized by this section, as 
        well as the distance education programs offered by other 
        institutions.
            ``(3) Interim and final reports.--The Secretary shall 
        request that the National Academy of Sciences submit an interim 
        report to the Secretary, the Committee on Labor and Human 
        Resources of the Senate, and the Committee on Education and the 
        Workforce of the House of Representatives not later than 
        December 31, 2000, and a final report not later than December 
        31, 2002, regarding the study.
            ``(4) Funding.--The Secretary shall make available not more 
        than $1,000,000 for the study required by this subsection.
    ``(h) Oversight.--In conducting the demonstration program 
authorized under this section, the Secretary shall, on a continuing 
basis--
            ``(1) assure compliance of institutions or consortia with 
        the requirements of this title (other than the sections and 
        regulations that are waived under subsection (b)(2));
            ``(2) provide technical assistance;
            ``(3) monitor fluctuations in the student population 
        enrolled in the participating institutions or consortia; and
            ``(4) consult with appropriate accrediting agencies or 
        associations and appropriate State regulatory authorities.
    ``(i) Definition.--For the purpose of this section, the term 
`distance learning' means an educational process that is characterized 
by the separation, in time or place, between instructor and student. 
Distance learning may include courses offered principally through the 
use of--
            ``(1) television, audio, or computer transmission, such as 
        open broadcast, closed circuit, cable, microwave, or satellite 
        transmission;
            ``(2) audio or computer conferencing;
            ``(3) video cassettes or discs; or
            ``(4) correspondence.''.

SEC. 489B. ADVISORY COMMITTEE ON STUDENT FINANCIAL ASSISTANCE.

    Section 491 (20 U.S.C. 1098) is amended--
            (1) in subsection (b)--
                    (A) in the second sentence, by striking ``and 
                expenditures'' and inserting ``, expenditures and 
                staffing levels''; and
                    (B) by inserting after the third sentence the 
                following: ``Reports, publications, and other 
                documents, including such reports, publications, and 
                documents in electronic form, shall not be subject to 
                review by the Secretary.'';
            (2) in subsection (e)--
                    (A) by redesignating paragraphs (3), (4), and (5), 
                as paragraphs (4), (5), and (6), respectively; and
                    (B) by inserting after paragraph (2) the following:
            ``(3) No officers or full-time employees of the Federal 
        Government shall serve as members of the Advisory Committee.'';
            (3) in subsection (g), by striking ``(1) Members'' and all 
        that follows through ``of the United States may'' and inserting 
        ``Members of the Advisory Committee may'';
            (4) in subsection (h)(1)--
                    (A) by inserting ``determined'' after ``as may 
                be''; and
                    (B) by adding at the end the following: ``The 
                Advisory Committee may appoint not more than 1 full-
                time equivalent, nonpermanent, consultant without 
                regard to the provisions of title 5, United States 
                Code. The Advisory Committee shall not be required by 
                the Secretary to reduce personnel to meet agency 
                personnel reduction goals.'';
            (5) in subsection (i), by striking ``$750,000'' and 
        inserting ``$800,000'';
            (6) by amending subsection (j) to read as follows:
    ``(j) Special Analyses and Activities.--The Advisory Committee 
shall--
            ``(1) monitor and evaluate the modernization of student 
        financial aid systems and delivery processes, including the 
        implementation of a performance-based organization within the 
        Department, and report to Congress regarding such modernization 
        on not less than an annual basis, including recommendations for 
        improvement;
            ``(2) assess the adequacy of current methods for 
        disseminating information about programs under this title and 
        recommend improvements, as appropriate, regarding early needs 
        assessment and information for first-year secondary school 
        students;
            ``(3) assess and make recommendations concerning the 
        feasibility and degree of use of appropriate technology in the 
        application for, and delivery and management of, financial 
        assistance under this title, as well as policies that promote 
        use of such technology to reduce cost and enhance service and 
        program integrity, including electronic application and 
        reapplication, just-in-time delivery of funds, reporting of 
        disbursements and reconciliation;
            ``(4) assess the implications of distance learning on 
        student eligibility and other requirements for financial 
        assistance under this title, and make recommendations that will 
        enhance access to postsecondary education through distance 
        learning while maintaining access, through on-campus 
        instruction at eligible institutions, and program integrity; 
        and
            ``(5) make recommendations to the Secretary regarding 
        redundant or outdated provisions of and regulations under this 
        Act, consistent with the Secretary's requirements under section 
        498A(b)(3).'';
            (7) in subsection (k), by striking ``1998'' and inserting 
        ``2004''; and
            (8) by repealing subsection (l).

SEC. 489C. REGIONAL MEETINGS AND NEGOTIATED RULEMAKING.

    Section 492 (20 U.S.C. 1098a) is amended--
            (1) in subsection (a)--
                    (A) in paragraph (1)--
                            (i) by inserting ``, after the enactment of 
                        each Act to reauthorize this Act that contains 
                        an amendment to this title,'' after ``The 
                        Secretary''; and
                            (ii) by inserting ``D,'' after ``B,''; and
                    (B) in paragraph (2)--
                            (i) by inserting ``D,'' after ``B,''; and
                            (ii) by striking ``1992'' and inserting 
                        ``1998, and for the implementation of this 
                        title as amended by each Act to reauthorize 
                        this Act enacted after the date of enactment of 
                        the Higher Education Amendments of 1998 that 
                        contains an amendment to this title''; and
            (2) in subsection (b)--
                    (A) by striking ``After'' and inserting the 
                following:
            ``(1) In general.--After'';
                    (B) in paragraph (1) (as redesignated by 
                subparagraph (A))--
                            (i) by inserting ``D,'' after ``B,''; and
                            (ii) by striking ``1992'' and inserting 
                        ``1998, and for the implementation of this 
                        title as amended by each Act to reauthorize 
                        this Act enacted after the date of enactment of 
                        the Higher Education Amendments of 1998 that 
                        contains an amendment to this title,''; and
                    (C) by adding at the end the following:
            ``(2) Expansion of negotiated rulemaking in student loan 
        programs.--All regulations pertaining to the student assistance 
        programs in parts B, D, G, and H, that are promulgated after 
        the date of enactment of this paragraph, shall be subject to 
        the negotiated rulemaking process, unless the Secretary 
        determines that exceptional circumstances exist making 
        negotiated rulemaking impractical with respect to given 
        regulations and publishes the basis for such determination in 
        the Federal Register at the same time as the proposed 
        regulations in questions are first published. All published 
        proposed regulations shall conform, unless impracticable, to 
        agreements resulting from such negotiated rulemaking. Such 
        negotiated rulemaking shall be conducted in accordance with the 
        provisions of paragraph (1).''.

                    PART H--PROGRAM INTEGRITY TRIAD

SEC. 491. STATE ROLE AND RESPONSIBILITIES.

    Subpart 1 of part H of title IV (20 U.S.C. 1099a et seq.) is 
amended to read as follows:

                        ``Subpart 1--State Role

``SEC. 495. STATE RESPONSIBILITIES.

    ``(a) State Responsibilities.--As part of the integrity program 
authorized by this part, each State, through 1 State agency or several 
State agencies selected by the State, shall--
            ``(1) furnish the Secretary, upon request, information with 
        respect to the process for licensing or other authorization for 
        institutions of higher education to operate within the State;
            ``(2) notify the Secretary promptly whenever the State 
        revokes a license or other authority to operate an institution 
        of higher education; and
            ``(3) notify the Secretary promptly whenever the State has 
        credible evidence that an institution of higher education 
        within the State--
                    ``(A) has committed fraud in the administration of 
                the student assistance programs authorized by this 
                title; or
                    ``(B) has substantially violated a provision of 
                this title.
    ``(b) Institutional Responsibility.--Each institution of higher 
education shall provide evidence to the Secretary that the institution 
has authority to operate within a State at the time the institution is 
certified under subpart 3.''.

SEC. 492. ACCREDITING AGENCY RECOGNITION.

    (a) Amendments to Headings.--Subpart 2 of part H of title IV (20 
U.S.C. 1099b et seq.) is amended--
            (1) in the subpart heading, by striking ``Approval'' and 
        inserting ``Recognition''; and
            (2) in the heading for section 496, by striking 
        ``approval'' and inserting ``recognition''.
    (b) Recognition of Accrediting Agency or Association.--Section 496 
(20 U.S.C. 1099b) is amended--
            (1) in the heading for subsection (a), by striking 
        ``Standards'' and inserting ``Criteria'';
            (2) in subsection (a)--
                    (A) in the matter preceding paragraph (1), by 
                striking ``standards'' each place the term appears and 
                inserting ``criteria'';
                    (B) in paragraph (4)--
                            (i) by striking ``at the institution'' and 
                        inserting ``offered by the institution''; and
                            (ii) by inserting ``, including distance 
                        education courses or programs,'' after ``higher 
                        education''; and
                    (C) in paragraph (5)--
                            (i) by striking subparagraph (I);
                            (ii) by redesignating subparagraphs (A) 
                        through (H) as subparagraphs (B) through (I), 
                        respectively;
                            (iii) by inserting before subparagraph (B) 
                        the following:
                    ``(A) success with respect to student achievement 
                in relation to the institution's mission, including, as 
                appropriate, consideration of course completion, State 
                licensing examination, and job placement rates;'';
                            (iv) in subparagraph (I) (as redesignated 
                        by clause (ii)), by striking ``in clock hours 
                        or credit hours''; and
                            (v) in subparagraph (L)--
                                    (I) by inserting ``record of'' 
                                before ``compliance'';
                                    (II) by striking ``Act, including 
                                any'' and inserting ``Act based on 
                                the'';
                                    (III) by inserting ``any'' after 
                                ``reviews, and''; and
                                    (IV) in the matter following 
                                subparagraph (L), by striking ``(G),'';
            (3) by amending paragraph (1) of subsection (l) to read as 
        follows: ``(1)(A)(i) If the Secretary determines that an 
        accrediting agency or association has failed to apply 
        effectively the standards in this section, or is otherwise not 
        in compliance with the requirements of this section, the 
        Secretary shall--
                    ``(I) after notice and opportunity for a hearing, 
                limit, suspend, or terminate the approval of the agency 
                or association; or
                    ``(II) require the agency or association to take 
                appropriate action to bring the agency or association 
                into compliance with such requirements within a 
                timeframe specified by the Secretary, except that--
                            ``(aa) such timeframe shall not exceed 12 
                        months unless the Secretary extends such period 
                        for good cause; and
                            ``(bb) if the agency or association fails 
                        to bring the agency or association into 
                        compliance within such timeframe, the Secretary 
                        shall, after notice and opportunity for a 
                        hearing, limit, suspend, or terminate the 
                        approval of the agency or association.''; and
            (4) in subsection (n)(3), by adding at the end the 
        following: ``When the Secretary decides to recognize an 
        accrediting agency or association, the Secretary shall 
        determine the agency or association's scope of recognition. If 
        the agency or association reviews institutions offering 
        distance education courses or programs and the Secretary 
        determines that the agency or association meets the 
        requirements of this section, then the agency shall be 
        recognized and the scope of recognition shall include 
        accreditation of institutions offering distance education 
        courses or programs.''.

SEC. 493. ELIGIBILITY AND CERTIFICATION PROCEDURES.

    (a) Single Application Form.--Section 498(b) (20 U.S.C. 1099c(b)) 
is amended--
            (1) in paragraph (1), by striking ``and capability'' and 
        inserting ``financial responsibility, and administrative 
        capability'';
            (2) by amending paragraph (3) to read as follows:
            ``(3) requires--
                    ``(A) a description of the third party servicers of 
                an institution of higher education; and
                    ``(B) the institution to maintain a copy of any 
                contract with a financial aid service provider or loan 
                servicer, and provide a copy of any such contract to 
                the Secretary upon request;'';
            (3) in paragraph (4), by striking the period and inserting 
        ``; and''; and
            (4) by adding at the end the following:
            ``(5) provides, at the option of the institution, for 
        participation in 1 or more of the programs under part B.''.
    (b) Financial Responsibility Standards.--Section 498(c) (20 U.S.C. 
1099c(c)) is amended--
            (1) in paragraph (2), by striking ``with respect to 
        operating losses, net worth, asset to liabilities ratios, or 
        operating fund deficits'' and inserting ``regarding ratios that 
        demonstrate financial responsibility,'';
            (2) in paragraph (3)(A), by striking ``Secretary third 
        party'' and all that follows through ``payable to the 
        Secretary'' and inserting ``Secretary any third party 
        guarantees, which the Secretary determines are reasonable, 
        that''; and
            (3) in paragraph (4)--
                    (A) in the matter preceding subparagraph (A), by 
                striking ``ratio of current assets to current 
                liabilities'' and inserting ``criteria''; and
                    (B) in subparagraph (C), by striking ``current 
                operating ratio requirement'' and inserting 
                ``criteria''.
    (c) Financial Guarantees From Owners.--Section 498(e) (20 U.S.C. 
1099c(e)) is amended--
            (1) in the subsection heading, by inserting ``of For-Profit 
        Institutions'' after ``Owners'';
            (2) in paragraph (1)(A), by inserting ``from an'' and 
        inserting ``from a for-profit'';
            (3) in paragraph (2)--
                    (A) in the matter preceding clause (i) of 
                subparagraph (A), by inserting ``for-profit'' after 
                ``or more'';
                    (B) in subparagraph (B), by inserting ``for-
                profit'' after ``or more''; and
            (4) in paragraph (3), by striking ``operation of, an 
        institution or'' and inserting ``operation of, a for-profit 
        institution or the''.
    (d) Applications and Site Visits.--Section 498(f) (20 U.S.C. 
1099c(f)) is amended--
            (1) in the subsection heading by striking ``; Site Visits 
        and Fees'' and inserting ``and Site Visits'';
            (2) in the second sentence, by striking ``shall'' and 
        inserting ``may'';
            (3) in the third sentence, strike ``may'' and insert 
        ``shall''; and
            (4) by striking the fourth sentence.
    (e) Time Limitations on, and Renewal of, Eligibility.--Subsection 
(g) of section 498 (20 U.S.C. 1099c) is amended to read as follows:
    ``(g) Time Limitations on, and Renewal of, Eligibility.--
            ``(1) General rule.--After the expiration of the 
        certification of any institution under the schedule prescribed 
        under this section (as in effect prior to the enactment of the 
        Higher Education Act Amendments of 1998), or upon request for 
        initial certification from an institution not previously 
        certified, the Secretary may certify the eligibility for the 
        purposes of any program authorized under this title of each 
        such institution for a period not to exceed 6 years.
            ``(2) Notification.--The Secretary shall notify each 
        institution of higher education not later than 6 months prior 
        to the date of the expiration of the institution's 
        certification.
            ``(3) Institutions outside the united states.--The 
        Secretary shall promulgate regulations regarding the 
        recertification requirements applicable to an institution of 
        higher education outside of the United States that meets the 
        requirements of section 481(a)(1)(C) and received less than 
        $500,000 in funds under part B for the most recent year for 
        which data are available.
    (f) Provisional Certification.--Section 498(h) (20 U.S.C. 1099c(h)) 
is amended--
            (1) in paragraph (1)(B)(ii), by striking ``an eligible'' 
        and inserting ``a for-profit eligible''; and
            (2) in paragraph (2), by striking ``the approval'' and 
        inserting ``the recognition''.
    (g) Treatment of Changes of Ownership.--Section 498(i) (20 U.S.C. 
1099c(i)) is amended--
            (1) in the subsection heading, by inserting ``of For-Profit 
        Institutions'' after ``Ownership''; and
            (2) in paragraph (2)--
                    (A) in subparagraph (A), by inserting ``for-
                profit'' before ``institution'';
                    (B) in subparagraph (C), by striking ``two'' and 
                inserting ``a for-profit institution with one'';
                    (C) in subparagraph (D), by inserting ``for-
                profit'' before ``institutions'';
                    (D) in subparagraph (E), by inserting ``for-
                profit'' before ``institutions''; and
                    (E) in subparagraph (F), by inserting ``for-
                profit'' before ``institution''.
    (h) Treatment of Branches.--The second sentence of section 
498(j)(1) (20 U.S.C. 1099c(j)(1)) is amended by inserting ``after the 
branch is certified by the Secretary as a branch campus participating 
in a program under title IV,'' after ``2 years''.

SEC. 494. PROGRAM REVIEW AND DATA.

    Section 498A (20 U.S.C. 1099c-1) is amended--
            (1) in subsection (a)--
                    (A) in paragraph (2)--
                            (i) in the matter preceding subparagraph 
                        (A), by striking ``may'' and inserting 
                        ``shall'';
                            (ii) by amending subparagraph (C) to read 
                        as follows:
                    ``(C) institutions with a significant fluctuation 
                in Federal Stafford Loan volume, Federal Direct 
                Stafford/Ford Loan volume, or Federal Pell Grant award 
                volume, or any combination thereof, in the year for 
                which the determination is made, compared to the year 
                prior to such year, that are not accounted for by 
                changes in the Federal Stafford Loan program, the 
                Federal Direct Stafford/Ford Loan program, or the Pell 
                Grant program, or any combination thereof;'';
                            (iii) by amending subparagraph (D) to read 
                        as follows:
                    ``(D) institutions reported to have deficiencies or 
                financial aid problems by the State licensing or 
                authorizing agency, or by the appropriate accrediting 
                agency or association;'';
                            (iv) in subparagraph (E), by inserting 
                        ``and'' after the semicolon; and
                            (v) by striking subparagraphs (F) and (G), 
                        and inserting the following:
                    ``(F) such other institutions that the Secretary 
                determines may pose a significant risk of failure to 
                comply with the administrative capability or financial 
                responsibility provisions of this title; and''; and
                    (B) in paragraph (3)(A), by inserting ``relevant'' 
                after ``all''; and
            (2) by amending subsection (b) to read as follows:
    ``(b) Special Administrative Rules.--
            ``(1) In general.--In carrying out paragraphs (1) and (2) 
        of subsection (a) and any other relevant provisions of this 
        title, the Secretary shall--
                    ``(A) establish guidelines designed to ensure 
                uniformity of practice in the conduct of program 
                reviews of institutions of higher education;
                    ``(B) make available to each institution 
                participating in programs authorized under this title 
                complete copies of all review guidelines and procedures 
                used in program reviews;
                    ``(C) permit the institution to correct or cure an 
                administrative, accounting, or recordkeeping error if 
                the error is not part of a pattern of error and there 
                is no evidence of fraud or misconduct related to the 
                error;
                    ``(D) base any civil penalty assessed against an 
                institution of higher education resulting from a 
                program review or audit on the gravity of the 
                violation, failure, or misrepresentation; and
                    ``(E) inform the appropriate State and accrediting 
                agency or association whenever the Secretary takes 
                action against an institution of higher education under 
                this section, section 498, or section 432.
            ``(2) Uniformity of application of regulations.--The 
        Secretary shall review the regulations of the Department and 
        the application of such regulations to ensure the uniformity of 
        interpretation and application of the regulations.
            ``(3) Nonduplication and coordination.--The Secretary shall 
        establish a process for ensuring that eligibility and 
        compliance issues, such as institutional audit, program review, 
        and recertification, are considered simultaneously, and shall 
        establish a process for identifying unnecessary duplication of 
        reporting and related regulatory requirements. In developing 
        such processes, the Secretary shall consult with relevant 
        representatives of institutions participating in the programs 
        authorized by this title.''.

  PART I--ADMINISTRATIVE PROVISIONS FOR DELIVERY OF STUDENT FINANCIAL 
                               ASSISTANCE

SEC. 495. PERFORMANCE-BASED ORGANIZATION FOR THE DELIVERY OF FEDERAL 
              STUDENT FINANCIAL ASSISTANCE.

    Title IV (20 U.S.C. 1070 et seq.) is amended by adding at the end 
the following:

 ``PART I--ADMINISTRATIVE PROVISIONS FOR DELIVERY OF STUDENT FINANCIAL 
                               ASSISTANCE

``SEC. 499. PERFORMANCE-BASED ORGANIZATION FOR THE DELIVERY OF FEDERAL 
              STUDENT FINANCIAL ASSISTANCE.

    ``(a) Establishment.--The Secretary shall establish in the 
Department a performance-based organization (hereafter in this part 
referred to as the `PBO') to administer various functions relating to 
student financial assistance programs authorized under this title.
    ``(b) Oversight and Authority.--
            ``(1) Policy oversight and direction.--The Secretary shall 
        maintain responsibility for the policy relating to functions 
        managed by the PBO, and the PBO shall remain subject to the 
Secretary's oversight and direction.
            ``(2) Audits and review.--The PBO shall be subject to the 
        usual and customary Federal audit procedures and to review by 
        the Inspector General of the Department.
            ``(3) Changes.--
                    ``(A) In general.--The Secretary and the Chief 
                Operating Officer shall consult concerning the effects 
                of policy, market, or other changes on the ability of 
                the PBO to achieve the goals and objectives established 
                in the performance plan described in subsection (e).
                    ``(B) Revisions to agreement.--The Secretary and 
                the Chief Operating Officer may revise the annual 
                performance agreement described in subsection (f)(2) in 
                light of policy, market, or other changes that occur 
                after the Secretary and the PBO enter into the 
                agreement.
    ``(c) Purposes of PBO.--The purposes of the PBO are--
            ``(1) to improve service to students and other participants 
        in the student financial assistance programs authorized under 
        this title, including making those programs more understandable 
        to students and their parents;
            ``(2) to reduce the costs of administering those programs;
            ``(3) to increase the accountability of the officials 
        responsible for administering those programs;
            ``(4) to provide greater flexibility in the administration 
        of those programs;
            ``(5) to improve and integrate the information and delivery 
        systems that support those programs; and
            ``(6) to develop and maintain a student financial 
        assistance system that contains complete, accurate, and timely 
        data to ensure program integrity.
    ``(d) Functions.--
            ``(1) In general.--Subject to subsection (b) of this 
        section, the PBO shall be responsible for administration of the 
        information and financial systems that support student 
        financial assistance programs authorized under this title, 
        including--
                    ``(A) collecting, processing, and transmitting 
                applicant data to students, institutions, and 
                authorized third parties, as provided for in section 
                483;
                    ``(B) contracting for the information and financial 
                systems supporting student financial assistance 
                programs under this title;
                    ``(C) developing technical specifications for 
                software and systems that support those programs; and
                    ``(D) providing all customer service, training, and 
                user support related to systems that support those 
                programs.
            ``(2) Additional functions.--The Secretary may allocate to 
        the PBO such additional functions as the Secretary determines 
        necessary or appropriate to achieve the purposes of the PBO.
    ``(e) Performance Plan and Report.--
            ``(1) Performance plan.--
                    ``(A) In general.--Each year, the Secretary and 
                Chief Operating Officer shall agree on, and make 
                available to the public, a performance plan for the PBO 
                for the succeeding 5 years that establishes measurable 
                goals and objectives for the organization.
                    ``(B) Consultation.--In developing the 5-year 
                performance plan, the Secretary and the Chief Operating 
                Officer shall consult with students, institutions of 
                higher education, Congress, lenders, and other 
                interested parties not less than 30 days prior to the 
                implementation of the performance plan.
                    ``(C) Areas.--The plan shall address the PBO's 
                responsibilities in the following areas:
                            ``(i) Improving service.--Improving service 
                        to students and other participants in student 
                        financial aid programs authorized under this 
                        title, including making those programs more 
                        understandable to students and their parents.
                            ``(ii) Reducing costs.--Reducing the costs 
                        of administering those programs.
                            ``(iii) Improvement and integration of 
                        support systems.--Improving and integrating the 
                        information and delivery systems that support 
                        those programs.
                            ``(iv) Delivery and information system.--
                        Developing an open, common, and integrated 
                        delivery and information system for programs 
                        authorized under this title.
                            ``(v) Other areas.--Any other areas 
                        identified by the Secretary.
            ``(2) Annual report.--Each year, the Chief Operating 
        Officer shall prepare and submit to Congress, through the 
        Secretary, an annual report on the performance of the PBO, 
        including an evaluation of the extent to which the PBO met the 
        goals and objectives contained in the 5-year performance plan 
        described in paragraph (1) for the preceding year.
    ``(f) Chief Operating Officer.--
            ``(1) Appointment.--
                    ``(A) In general.--The management of the PBO shall 
                be vested in a Chief Operating Officer who shall be 
                appointed by the Secretary to a term of not less than 3 
                and not more than 5 years and compensated without 
                regard to chapters 33, 51, and 53 of title 5, United 
                States Code.
                    ``(B) Basis.--The appointment shall be made on the 
                basis of demonstrated ability in management and 
                experience in information technology or financial 
                services, without regard to political affiliation or 
                activity.
                    ``(C) Reappointment.--The Secretary may reappoint 
                the Chief Operating Officer to subsequent terms of not 
                less than 3 and not more than 5 years, so long as the 
                performance of the Chief Operating Officer, as set 
                forth in the performance agreement described in 
                paragraph (2), is satisfactory.
            ``(2) Performance agreement.--
                    ``(A) In general.--Each year, the Secretary and the 
                Chief Operating Officer shall enter into an annual 
                performance agreement, that shall set forth measurable 
                organization and individual goals for the Chief 
                Operating Officer.
                    ``(B) Transmittal.--The final agreement shall be 
                transmitted to the Committee on Education and the 
                Workforce of the House of Representatives and the 
                Committee on Labor and Human Resources of the Senate, 
                and made publicly available.
            ``(3) Compensation.--
                    ``(A) In general.--The Chief Operating Officer is 
                authorized to be paid at an annual rate of basic pay 
                not to exceed the maximum rate of basic pay for the 
                Senior Executive Service under section 5382 of title 5, 
                United States Code, including any applicable locality-
                based comparability payment that may be authorized 
                under section 5304(h)(2)(C) of such title.
                    ``(B) Bonus.--In addition, the Chief Operating 
                Officer may receive a bonus in an amount that does not 
                exceed 50 percent of such annual rate of basic pay, 
                based upon the Secretary's evaluation of the Chief 
                Operating Officer's performance in relation to the 
                goals set forth in the performance agreement described 
                in paragraph (2).
                    ``(C) Payment.--Payment of a bonus under this 
                subparagraph (B) may be made to the Chief Operating 
                Officer only to the extent that such payment does not 
                cause the Chief Operating Officer's total aggregate 
                compensation in a calendar year to equal or exceed the 
                amount of the President's salary under section 102 of 
                title 3, United States Code.
            ``(4) Removal.--The Chief Operating Officer shall be 
        removable--
                    ``(A) by the President; or
                    ``(B) by the Secretary for misconduct or failure to 
                meet the goals set forth in the performance agreement 
                described in paragraph (2).
    ``(g) Senior Management.--
            ``(1) Appointment.--
                    ``(A) In general.--The Chief Operating Officer may 
                appoint such senior managers as that officer determines 
                necessary without regard to the provisions of title 5, 
                United States Code, governing appointments in the 
                competitive service.
                    ``(B) Compensation.--The senior managers described 
                in subparagraph (A) may be paid without regard to the 
                provisions of chapter 51 and subchapter III of chapter 
                53 of such title relating to classification and General 
                Schedule pay rates.
            ``(2) Performance agreement.--Each year, the Chief 
        Operating Officer and each senior manager appointed under this 
        subsection shall enter into an annual performance agreement 
        that sets forth measurable organization and individual goals.
            ``(3) Compensation.--
                    ``(A) In general.--A senior manager appointed under 
                this subsection may be paid at an annual rate of basic 
                pay of not more than the maximum rate of basic pay for 
                the Senior Executive Service under section 5382 of 
                title 5, United States Code, including any applicable 
                locality-based comparability payment that may be 
                authorized under section 5304(h)(2)(C) of such title 5.
                    ``(B) Bonus.--In addition, a senior manager may 
                receive a bonus in an amount such that the manager's 
                total annual compensation does not exceed 125 percent 
                of the maximum rate of basic pay for the Senior 
                Executive Service, including any applicable locality-
                based comparability payment, based upon the Chief 
                Operating Officer's evaluation of the manager's 
                performance in relation to the goals set forth in the 
                performance agreement described in paragraph (2).
            ``(4) Removal.--A senior manager shall be removable by the 
        Secretary or by the Chief Operating Officer.
    ``(h) Authorization of Appropriations.--The Secretary shall 
allocate from funds made available under section 458 such funds as are 
appropriate to the functions assumed by the PBO. In addition, there are 
authorized to be appropriated such sums as may be necessary to carry 
out the purposes of this section, including transition costs.''.

        TITLE V--GRADUATE AND POSTSECONDARY IMPROVEMENT PROGRAMS

SEC. 501. REPEALS, TRANSFERS, AND REDESIGNATIONS.

    (a) In General.--Title V (20 U.S.C. 1101 et seq.) is amended--
            (1) by amending the title heading to read as follows:

     ``TITLE V--GRADUATE AND POSTSECONDARY IMPROVEMENT PROGRAMS'';

            (2) by repealing parts A, B, C, D, E, and F of title V (20 
        U.S.C. 1102 et seq., 1103 et seq., 1104 et seq., 1107 et seq., 
        1111 et seq., and 1113 et seq.);
            (3) by transferring part C of title IX, part D of title IX, 
        part A of title XI, and part A of title X (20 U.S.C. 1134h et 
        seq., 1134l et seq., 1136 et seq., and 1135 et seq.) to title V 
        and redesignating such parts as parts A, B, C, and D, 
        respectively;
            (4) by redesignating sections 931 through 935 (20 U.S.C. 
        1134h et seq. and 1134k-1 et seq.) as sections 511 through 515, 
        respectively;
            (5) by redesignating sections 941 through 947 (20 U.S.C. 
        1134l and 1134q-1) as section 521 through 527, respectively;
            (6) by redesignating sections 1101 through 1109 (20 U.S.C. 
        1136 through 1136h) as sections 531 through 539, respectively; 
        and
            (7) by redesignating sections 1001, 1002, 1003, 1004, and 
        1011 (20 U.S.C. 1135, 1135a-1, 1135a-2, 1135a-3, and 1135a-11) 
        as sections 541, 542, 543, 544, and 551, respectively.
    (b) Cross Reference Conforming Amendments.--
            (1) Jacob k. javits fellowship program.--Section 514(a) (as 
        redesignated by subsection (a)(4)) (20 U.S.C. 1134k(a)) is 
        amended by striking ``933'' and inserting ``513''.
            (2) Graduate assistance in areas of national need.--Part B 
        of title V (as redesignated by paragraphs (3) and (5) of 
        subsection (a)) (20 U.S.C. 1134l et seq.) is amended--
                    (A) in section 524(b)(7) (as redesignated by 
                subsection (a)(5)) (20 U.S.C. 1134o(b)(7)), by striking 
                ``945'' and inserting ``525''; and
                    (B) in section 525(c) (as redesignated by 
                subsection (a)(5)) (20 U.S.C. 1134p(c))--
                            (i) by striking ``946(a)'' and inserting 
                        ``526(a)''; and
                            (ii) by striking ``944(b)(2)'' and 
                        inserting ``524(b)(2)''.
            (3) Urban and community service.--Part C of title V (as 
        redesignated by paragraphs (3) and (6) of subsection (a)) (20 
        U.S.C. 1136 et seq.) is amended--
                    (A) in section 532(b) (20 U.S.C. 1136a(b)), by 
                striking ``1104'' and inserting ``534'';
                    (B) in section 534(12) (20 U.S.C. 1136c(12)), by 
                striking ``1103(a)(2)(B)'' and inserting 
                ``533(a)(2)(B)''; and
                    (C) in section 538(1) (20 U.S.C. 1136g(1)), by 
                striking ``1103'' and inserting ``533''.
            (4) FIPSE.--Subsections (b) and (c) of section 544 (as 
        redesignated by subsection (a)(7)) (20 U.S.C. 1135a-3) each are 
        amended by striking ``1001(b)'' and inserting ``541(b)''.

SEC. 502. PURPOSE.

    Section 500 (20 U.S.C. 1101) is amended to read as follows:

``SEC. 500. PURPOSE.

    ``It is the purpose of this title--
            ``(1) to authorize national graduate fellowship programs--
                    ``(A) in order to attract students of superior 
                ability and achievement, exceptional promise, and 
                demonstrated financial need, into high-quality graduate 
                programs and provide the students with the financial 
                support necessary to complete advanced degrees; and
                    ``(B) that are designed to--
                            ``(i) sustain and enhance the capacity for 
                        graduate education in areas of national need; 
                        and
                            ``(ii) encourage talented students to 
                        pursue scholarly careers in the humanities, 
                        social sciences, and the arts; and
            ``(2) to promote postsecondary programs.''.

               PART A--JACOB K. JAVITS FELLOWSHIP PROGRAM

SEC. 511. AWARD OF FELLOWSHIPS.

    (a) Award of Jacob K. Javits Fellowships.--Section 511 (as 
redesignated by section 501(4)) is amended--
            (1) in subsection (a)--
                    (A) in the first sentence, by inserting ``, 
                financial need,'' after ``demonstrated achievement'';
                    (B) in the second sentence--
                            (i) by striking ``students intending'' and 
                        inserting ``students who are eligible to 
                        receive any grant, loan, or work assistance 
                        pursuant to section 484 and intend''; and
                            (ii) by striking ``commonly accepted'' and 
                        all that follows through ``degree-granting 
                        institution'' and inserting ``the terminal 
                        highest degree awarded in the area of study''; 
                        and
                    (C) in the third sentence, by inserting ``following 
                the fiscal year'' after ``July 1 of the fiscal year''; 
                and
            (2) by adding at the end the following:
    ``(d) Process and Timing of Competition.--The Secretary shall make 
applications for fellowships under this part available not later than 
October 1 of the academic year preceding the academic year for which 
fellowships will be awarded, and shall announce the recipients of 
fellowships under this section not later than March 1 of the academic 
year preceding the academic year for which the fellowships are awarded.
    ``(e) Authority To Contract.--The Secretary is authorized to enter 
into a contract with a nongovernmental agency to administer the program 
assisted under this part if the Secretary determines that entering into 
the contract is an efficient means of carrying out the program.''.
    (b) Allocation of Fellowships.--Section 512 (as redesignated by 
section 501(4)) (20 U.S.C. 1134i) is amended--
            (1) in subsection (a)--
                    (A) in the third sentence of paragraph (1), by 
                striking ``knowledgeable about and have experience'' 
                and inserting ``representative of a range of 
                disciplines''; and
                    (B) in paragraph (2)--
                            (i) by amending subparagraph (B) to read as 
                        follows:
                    ``(B) establish general criteria for the award of 
                fellowships in academic fields identified by the Board, 
                or, in the event that the Secretary enters into a 
                contract with a nongovernmental entity to administer 
                the program assisted under this part, by such 
                nongovernmental entity;''; and
                            (ii) in subparagraph (C), by inserting 
                        ``except that, in the event that the Secretary 
                        enters into a contract with a nongovernmental 
                        entity to administer the program, such panels 
                        may be appointed by such nongovernmental 
                        entity'' before the semicolon; and
            (2) in the first sentence of subsection (b), by inserting 
        ``except that in the event that the Secretary enters into a 
        contract with a nongovernmental entity to administer the 
        program, such panels may be appointed by such nongovernmental 
        entity'' before the period.
    (c) Stipends.--Section 513 (as redesignated by section 501(4)) (20 
U.S.C. 1134j) is amended--
            (1) in subsection (a)--
                    (A) by striking ``1993-1994'' and inserting ``1999-
                2000''; and
                    (B) by striking ``according to measurements of need 
                approved by the Secretary'' and inserting ``determined 
                in accordance with part F of title IV''; and
            (2) in subsection (b)(1)(A)--
                    (A) in clause (i)--
                            (i) by striking ``$6,000'' and inserting 
                        ``$10,000''; and
                            (ii) by striking ``1993-1994'' and 
                        inserting ``1999-2000''; and
                    (B) in clause (ii)--
                            (i) in the matter preceding subclause (I), 
                        by striking ``1993-1994'' and inserting ``1999-
                        2000'';
                            (ii) in subclause (I), by striking ``$9,000 
                        for the academic year 1993-1994'' and inserting 
                        ``$10,000 for the academic year 1999-2000''; 
                        and
                            (iii) in subclause (II), by striking 
                        ``$9,000'' and inserting ``$10,000''.
    (d) Authorization of Appropriations.--Section 515 (as redesignated 
by section 501(4)) (20 U.S.C. 1134k-1) is amended by striking ``1993'' 
and inserting ``1999''.

         PART B--GRADUATE ASSISTANCE IN AREAS OF NATIONAL NEED

SEC. 521. GRADUATE ASSISTANCE IN AREAS OF NATIONAL NEED.

    (a) Designation of Areas of National Need.--Subsection (b) of 
section 523 (as redesignated by section 501(5)) (20 U.S.C. 1134n) is 
amended to read as follows:
    ``(b) Designation of Areas of National Need.--After consultation 
with the National Science Foundation, the National Academy of Sciences, 
and other appropriate Federal and nonprofit agencies and organizations, 
the Secretary shall designate areas of national need. In making such 
designations, the Secretary shall take into consideration--
            ``(1) the extent to which the national interest in the area 
        is compelling;
            ``(2) the extent to which other Federal programs support 
        postbaccalaureate study in the area concerned; and
            ``(3) an assessment of how the program may achieve the most 
        significant impact with available resources.''.
    (b) Content of Applications.--Section 524(b) (as redesignated by 
section 501(5)) (20 U.S.C. 1134o(b)) is amended--
            (1) in paragraph (2)--
                    (A) by striking ``funds'' and inserting 
                ``sources''; and
                    (B) by inserting ``, which contribution may be in 
                cash or in kind, fairly valued'' before the semicolon;
            (2) by redesignating paragraphs (4) through (9) as 
        paragraphs (5) through (10), respectively;
            (3) by inserting after paragraph (3) the following:
            ``(4) describe the number, types, and amounts of the 
        fellowships that the applicant intends to offer with grant 
        funds provided under this part;'' and
            (4) in paragraph (5)(A) (as redesignated by paragraph (2)), 
        by striking ``criteria developed by the institution'' and 
        inserting ``part F of title IV''.
    (c) Awards.--Section 525 (as redesignated by section 501(5)) (20 
U.S.C. 1134p) is amended--
            (1) in the third sentence of subsection (b)--
                    (A) by striking ``1993-1994'' and inserting ``1999-
                2000''; and
                    (B) by striking ``according to measurements of need 
                approved by the Secretary'' and inserting ``determined 
                in accordance with part F of title IV''; and
            (2) in subsection (c), by striking ``such payments'' and 
        inserting ``such excess''.
    (d) Institutional Payments.--Section 526(a)(1) (as redesignated by 
section 501(5)) (20 U.S.C. 1134q(a)(1)) is amended--
            (1) in subparagraph (A)--
                    (A) by striking ``$6,000 annually'' and inserting 
                ``$10,000 for each academic year,''; and
                    (B) by striking ``1993-1994'' and inserting ``1999-
                2000''; and
            (2) in subparagraph (B)--
                    (A) in the matter preceding clause (i), by striking 
                ``1993-1994'' and inserting ``1999-2000'';
                    (B) in clause (i), by striking ``$9,000 for the 
                academic year 1993-1994'' and inserting ``$10,000 for 
                the academic year 1999-2000''; and
                    (C) in clause (ii), by striking ``$9,000'' and 
                inserting ``$10,000''.
    (e) Authorization of Appropriations.--Section 527 (as redesignated 
by section 501(5)) (20 U.S.C. 1134q-1) is amended by striking 
``$40,000,000 for fiscal year 1993'' and inserting ``$30,000,000 for 
fiscal year 1999''.

                    PART C--URBAN COMMUNITY SERVICE

SEC. 531. URBAN COMMUNITY SERVICE.

    (a) Priority.--Section 533(b) (as redesignated by section 
501(a)(6)) (20 U.S.C. 1136b(b)) is amended by adding at the end the 
following: ``In addition, the Secretary shall give priority to eligible 
institutions submitting applications that demonstrate the eligible 
institution's commitment to urban community service.''.
    (b) Authorization of Appropriations.--Section 539 (as redesignated 
by section 501(a)(6)) (20 U.S.C. 1136h) is amended by striking ``1993'' 
and inserting ``1999''.

      PART D--FUND FOR THE IMPROVEMENT OF POSTSECONDARY EDUCATION

SEC. 541. FUND FOR THE IMPROVEMENT OF POSTSECONDARY EDUCATION.

    (a) Authority.--Section 541(a) (as redesignated by section 
501(a)(7)) (20 U.S.C. 1135(a)) is amended--
            (1) in the matter preceding paragraph (1)--
                    (A) by striking ``or combinations of such 
                institutions'' and inserting ``, combinations of such 
                institutions,''; and
                    (B) by striking ``institutions and combinations of 
                such institutions'' and inserting ``institutions, 
                combinations, and agencies''; and
            (2) in paragraph (2)--
                    (A) by striking ``and programs involving new'' and 
                inserting ``, programs and joint efforts involving''; 
                and
                    (B) by striking ``new combinations'' and inserting 
                ``combinations''.
    (b) Technical Employees.--Section 543(a) (as redesignated by 
section 501(a)(7)) (20 U.S.C. 1135a-2(a)) is amended by striking ``5 
technical'' and inserting ``7 technical''.
    (c) Authorization of Appropriations.--Section 544 (as redesignated 
by section 501(a)(7)) (20 U.S.C. 1135a-3) is amended--
            (1) in subsection (a), by striking ``$20,000,000 for fiscal 
        year 1993'' and inserting ``$26,000,000 for fiscal year 1999''; 
        and
            (2) in subsection (b), by striking ``1993'' and inserting 
        ``1999''.
    (d) Areas of National Need.--
            (1) Areas.--Section 551(c) (as redesignated by section 
        501(a)(7)) (20 U.S.C. 1135a-11(c)) is amended--
                    (A) in paragraph (2), by striking ``Campus climate 
                and culture'' and inserting ``Institutional 
                restructuring to improve learning and promote cost 
                efficiencies'';
                    (B) in paragraph (3), by inserting ``of model 
                programs'' after ``dissemination''; and
                    (C) by adding at the end the following:
            ``(4) Articulation between 2-year and 4-year institutions 
        of higher education, including developing innovative methods 
        for ensuring the successful transfer of students from 2-year to 
        4-year institutions of higher education.''.
            (2) Authorization of appropriations.--Section 551(d) (as 
        redesignated by section 501(a)(7)) (20 U.S.C. 1135a-11(d)) is 
        amended by striking ``1993'' and inserting ``1999''.

PART E--HIGHER EDUCATION ACCESS FOR STUDENTS WITH DISABILITIES; GENERAL 
                               PROVISIONS

SEC. 551. HIGHER EDUCATION ACCESS FOR STUDENTS WITH DISABILITIES; 
              GENERAL PROVISIONS.

    Title V (20 U.S.C. 1101 et seq.) is amended further by adding at 
the end the following:

    ``PART F--HIGHER EDUCATION ACCESS FOR STUDENTS WITH DISABILITIES

``SEC. 571. HIGHER EDUCATION ACCESS FOR STUDENTS WITH DISABILITIES.

    ``(a) Purpose.--It is the purpose of this part--
            ``(1) to support the development of model programs to 
        provide technical assistance or training, and professional 
        development, for faculty and administrators in institutions of 
higher education, as defined in section 481(a), to provide the faculty 
and administrators with the skills and assistance to teach effectively 
students with disabilities; and
            ``(2) to ensure effective evaluation and dissemination of 
        such model programs.
    ``(b) Grants Authorized.--
            ``(1) In general.--The Secretary is authorized to award 
        grants to institutions of higher education to carry out the 
        purposes of this part.
            ``(2) Model programs.--To the extent feasible, the model 
        programs developed under this part shall be developed for a 
        range of types and sizes of institutions of higher education.
            ``(3) Geographic distribution.--In awarding grants under 
        this part, the Secretary shall consider--
                    ``(A) providing an equitable geographic 
                distribution of such grants; and
                    ``(B) distributing such grants to urban and rural 
                areas.
            ``(4) Approaches.--The Secretary shall award grants under 
        this part for a range of approaches to providing support to 
        faculty and administrators, such as in-service training, 
        professional development, customized and general technical 
        assistance, workshops, summer institutes, distance learning and 
        the use of educational technology.
    ``(c) Dissemination of Grants.--The Secretary may award grants to 
institutions of higher education that have demonstrated exceptional 
programs for students with disabilities under this part in order to 
disseminate those programs.
    ``(d) Applications.--Each institution of higher education desiring 
a grant under this part shall submit an application to the Secretary at 
such time, in such manner, and accompanied by such information as the 
Secretary may require. Each such application shall include--
            ``(1) a plan to assess the needs of the institution of 
        higher education in order to meet the purposes of this part, in 
        consultation with a broad range of persons within that 
        institution; and
            ``(2) a plan for coordinating with or collaborating with 
        the office within the institution that provides services to 
        students with disabilities, and the equal opportunity office 
        within the institution, if the offices exist.
    ``(e) Use of Funds.--Any institution of higher education receiving 
a grant under this part--
            ``(1) shall use the grant funds to--
                    ``(A) meet the purposes of this section; and
                    ``(B) ensure that projects assisted under this part 
                include components for model development, 
                demonstration, evaluation, and dissemination to other 
                institutions of higher education; and
            ``(2) may include, to the extent practicable, graduate 
        teaching assistants in the services provided under the grant.
    ``(f) Grant Awards.--The Secretary shall award grants under this 
part for a period of 3 years.
    ``(g) Construction.--Nothing in this section shall be construed to 
impose any additional duty, obligation, or responsibility on an 
institution of higher education, or on the institution's 
administrators, faculty, or staff, in addition to the requirements of 
section 504 of the Rehabilitation Act of 1973 and the Americans with 
Disabilities Act of 1990.
    ``(h) Authorization of Appropriations.--There are authorized to be 
appropriated to carry out this section $10,000,000 for fiscal year 1999 
and such sums as may be necessary for each of the 4 succeeding fiscal 
years.

                      ``PART G--GENERAL PROVISIONS

``SEC. 581. ADMINISTRATIVE PROVISIONS FOR PARTS A AND B.

    ``(a) Coordinated Administration.--In carrying out the purpose 
described in section 500(1), the Secretary shall provide for 
coordinated administration and regulation of graduate programs assisted 
under parts A and B with other Federal programs providing assistance 
for graduate education in order to minimize duplication and improve 
efficiency to ensure that the programs are carried out in a manner most 
compatible with academic practices and with the standard timetables for 
applications for, and notifications of acceptance to, graduate 
programs.
    ``(b) Hiring Authority.--For purposes of carrying out parts A and 
B, the Secretary shall appoint, without regard to the provisions of 
title 5, United States Code, that govern appointments in the 
competitive service, such administrative and technical employees, with 
the appropriate educational background, as shall be needed to assist in 
the administration of such parts. The employees shall be paid without 
regard to the provisions of chapter 51 and subchapter III of chapter 53 
of such title relating to classification and General Schedule pay 
rates.
    ``(c) Use for Religious Purposes Prohibited.--No institutional 
payment or allowance under section 513(b) or 526 shall be paid to a 
school or department of divinity as a result of the award of a 
fellowship under part A or B, respectively, to an individual who is 
studying for a religious vocation.
    ``(d) Evaluation.--The Secretary shall evaluate the success of 
assistance provided to individuals under part A or B with respect to 
graduating from their degree programs, and placement in faculty and 
professional positions.
    ``(e) Continuation Awards.--The Secretary, using funds appropriated 
to carry out parts A and B, and before awarding any assistance under 
such parts to a recipient that did not receive assistance under part C 
or D of title IX (as such parts were in effect prior to the date of 
enactment of the Higher Education Amendments of 1998) shall continue to 
provide funding to recipients of assistance under such part C or D (as 
so in effect), as the case may be, pursuant to any multiyear award of 
such assistance.''.

               TITLE VI--INTERNATIONAL EDUCATION PROGRAMS

SEC. 601. INTERNATIONAL AND FOREIGN LANGUAGE STUDIES.

    Part A of title VI (20 U.S.C. 1121 et seq.) is amended to read as 
follows:

          ``PART A--INTERNATIONAL AND FOREIGN LANGUAGE STUDIES

``SEC. 601. FINDINGS AND PURPOSES.

    ``(a) Findings.--The Congress finds that--
            ``(1) the well-being of the United States, its economy and 
        long-range security, is dependent on the education and training 
        of Americans in international and foreign language studies and 
        on a strong research base in these areas;
            ``(2) knowledge of other countries and the ability to 
        communicate in other languages is essential to the promotion of 
        mutual understanding and cooperation among nations; and
            ``(3) systematic efforts are necessary to enhance the 
        capacity of institutions of higher education in the United 
        States for--
                    ``(A) producing graduates with international and 
                foreign language expertise and knowledge; and
                    ``(B) research regarding such expertise and 
                knowledge.
    ``(b) Purposes.--It is the purpose of this part--
            ``(1) to assist in the development of knowledge, 
        international study, resources and trained personnel;
            ``(2) to stimulate the attainment of foreign language 
        acquisition and fluency;
            ``(3) to develop a pool of international experts to meet 
        national needs; and
            ``(4) to coordinate the programs of the Federal Government 
        in the areas of foreign language, area and other international 
        studies, including professional international affairs 
        education, and research.

``SEC. 602. GRADUATE AND UNDERGRADUATE LANGUAGE AND AREA CENTERS AND 
              PROGRAMS.

    ``(a) National Language and Area Centers and Programs Authorized.--
            ``(1) Centers and programs.--
                    ``(A) In general.--The Secretary is authorized--
                            ``(i) to make grants to institutions of 
                        higher education, or combinations thereof, for 
                        the purpose of establishing, strengthening, and 
                        operating comprehensive language and area 
                        centers and programs; and
                            ``(ii) to make grants to such institutions 
                        or combinations for the purpose of 
                        establishing, strengthening, and operating a 
                        diverse network of undergraduate language and 
                        area centers and programs.
                    ``(B) National resources.--The centers and programs 
                referred to in paragraph (1) shall be national 
                resources for--
                            ``(i) teaching of any modern foreign 
                        language;
                            ``(ii) instruction in fields needed to 
                        provide full understanding of areas, regions, 
                        or countries in which such language is commonly 
                        used;
                            ``(iii) research and training in 
                        international studies, and the international 
                        and foreign language aspects of professional 
                        and other fields of study; and
                            ``(iv) instruction and research on issues 
                        in world affairs which concern one or more 
                        countries.
            ``(2) Authorized activities.--Any such grant may be used to 
        pay all or part of the cost of establishing or operating a 
        center or program, including the cost of--
                    ``(A) faculty, staff, and student travel in foreign 
                areas, regions, or countries;
                    ``(B) teaching and research materials;
                    ``(C) curriculum planning and development;
                    ``(D) bringing visiting scholars and faculty to the 
                center to teach or to conduct research;
                    ``(E) establishing and maintaining linkages with 
                overseas institutions of higher education and other 
                organizations that may contribute to the teaching and 
                research of the center or program; and
                    ``(F) training and improvement of the staff, for 
                the purpose of, and subject to such conditions as the 
                Secretary finds necessary for, carrying out this 
                section.
            ``(3) Grants to maintain library collections.--The 
        Secretary may make grants to centers described in paragraph (1) 
        having important library collections, as determined by the 
        Secretary, for the maintenance of such collections.
            ``(4) Outreach grants and summer institutes.--The Secretary 
        may make additional grants to centers described in paragraph 
        (1) for any one or more of the following purposes:
                    ``(A) Programs of linkage or outreach between 
                foreign language, area studies, and other international 
                fields and professional schools and colleges.
                    ``(B) Programs of linkage or outreach with 2-year 
                and 4-year colleges and universities.
                    ``(C) Programs of linkage or outreach with 
                departments or agencies of Federal and State 
                Governments.
                    ``(D) Programs of linkage or outreach with the news 
                media, business, professional, or trade associations.
                    ``(E) Summer institutes in foreign area, foreign 
                language, and other international fields designed to 
                carry out the programs of linkage and outreach in 
                subparagraphs (A), (B), (C), and (D).
    ``(b) Stipends for Foreign Language and Area Studies.--
            ``(1) In general.--The Secretary is authorized to make 
        grants to institutions of higher education or combinations of 
        such institutions for the purpose of paying stipends to 
        individuals undergoing advanced training in any center or 
        program approved by the Secretary.
            ``(2) Requirements.--Students receiving stipends described 
        in paragraph (1) shall be individuals who are engaged in an 
        instructional program with stated performance goals for 
        functional foreign language use or in a program developing such 
        performance goals, in combination with area studies, 
        international studies, or the international aspects of a 
        professional studies program.
            ``(3) Allowances.--Stipends awarded to graduate level 
        recipients may include allowances for dependents and for travel 
        for research and study in the United States and abroad.
    ``(c) Special Rule With Respect to Travel.--No funds may be 
expended under this part for undergraduate travel except in accordance 
with rules prescribed by the Secretary setting forth policies and 
procedures to assure that Federal funds made available for such travel 
are expended as part of a formal program of supervised study.

``SEC. 603. LANGUAGE RESOURCE CENTERS.

    ``(a) Language Resource Centers Authorized.--The Secretary is 
authorized to make grants to and enter into contracts with institutions 
of higher education, or combinations of such institutions, for the 
purpose of establishing, strengthening, and operating a small number of 
national language resource and training centers, which shall serve as 
resources to improve the capacity to teach and learn foreign languages 
effectively.
    ``(b) Authorized Activities.--The activities carried out by the 
centers described in subsection (a)--
            ``(1) shall include effective dissemination efforts, 
        whenever appropriate; and
            ``(2) may include--
                    ``(A) the conduct and dissemination of research on 
                new and improved teaching methods, including the use of 
                advanced educational technology;
                    ``(B) the development and dissemination of new 
                teaching materials reflecting the use of such research 
                in effective teaching strategies;
                    ``(C) the development, application, and 
                dissemination of performance testing appropriate to an 
                educational setting for use as a standard and 
                comparable measurement of skill levels in all 
                languages;
                    ``(D) the training of teachers in the 
                administration and interpretation of performance tests, 
                the use of effective teaching strategies, and the use 
                of new technologies;
                    ``(E) the publication and dissemination to 
                individuals and organizations in the foreign language 
                field of instructional materials in the less commonly 
                taught languages;
                    ``(F) the development and dissemination of 
                materials designed to serve as a resource for foreign 
                language teachers at the elementary and secondary 
                school levels; and
                    ``(G) the operation of intensive summer language 
                institutes to train advanced foreign language students, 
                provide professional development, and improve language 
                instruction through preservice and inservice language 
                training for teachers.
    ``(c) Conditions for Grants.--Grants under this section shall be 
made on such conditions as the Secretary determines to be necessary to 
carry out the provisions of this section.

``SEC. 604. UNDERGRADUATE INTERNATIONAL STUDIES AND FOREIGN LANGUAGE 
              PROGRAMS.

    ``(a) Incentives for the Creation of New Programs and the 
Strengthening of Existing Programs in Undergraduate International 
Studies and Foreign Languages.--
            ``(1) Authority.--The Secretary is authorized to make 
        grants to institutions of higher education, combinations of 
        such institutions, or partnerships between nonprofit 
        educational institutions and institutions of higher education, 
        to assist such institutions, combinations or partnerships in 
        planning, developing, and carrying out programs to improve 
        undergraduate instruction in international studies and foreign 
        languages. Such grants shall be awarded to institutions, 
        combinations or partnerships seeking to create new programs or 
        to strengthen existing programs in area studies, foreign 
        languages, and other international fields.
            ``(2) Federal share and use of funds.--Grants made under 
        this section may be used to pay not more than 50 percent of the 
        cost of projects and activities which are an integral part of 
        such a program, such as--
                    ``(A) planning for the development and expansion of 
                undergraduate programs in international studies and 
                foreign languages;
                    ``(B) teaching, research, curriculum development, 
                faculty training in the United States or abroad, and 
                other related activities, including the expansion of 
                library and teaching resources;
                    ``(C) expansion of opportunities for learning 
                foreign languages, including less commonly taught 
                languages;
                    ``(D) programs under which foreign teachers and 
                scholars may visit institutions as visiting faculty;
                    ``(E) programs designed to develop or enhance 
                linkages between 2-year and 4-year institutions of 
                higher education, or baccalaureate and post-
                baccalaureate programs or institutions;
                    ``(F) the development of undergraduate study abroad 
                programs in locations abroad in which such study 
                opportunities are not otherwise available and the 
                integration of these programs into specific on-campus 
                degree programs;
                    ``(G) the development of model programs to enhance 
                the effectiveness of study abroad, including 
                predeparture and post return programs;
                    ``(H) the development of programs designed to 
                integrate professional and technical education with 
                area studies, foreign languages, and other 
                international fields;
                    ``(I) the conduct of summer institutes in foreign 
                area, foreign language, and other international fields 
                for purposes that are consistent with the projects and 
                activities described in this subsection; and
                    ``(J) the development of partnerships between 
                institutions of higher education and the private 
                sector, government, and elementary and secondary 
                education institutions to enhance international 
                knowledge.
            ``(3) Non-federal share.--The non-Federal share of the cost 
        of the programs assisted under this subsection may be provided 
        either in cash or in kind. Such assistance may be composed of 
        institutional and noninstitutional funds, including State, 
        private sector, corporation, or foundation contributions.
            ``(4) Priority.--In awarding grants under this section, the 
        Secretary shall give priority to applications from institutions 
        of higher education, combinations or partnerships that require 
        entering students to have successfully completed at least 2 
        years of secondary school foreign language instruction or that 
        require each graduating student to earn 2 years of 
        postsecondary credit in a foreign language (or have 
        demonstrated equivalent competence in the foreign language) or, 
        in the case of a 2-year degree granting institution, offer 2 
        years of postsecondary credit in a foreign language.
            ``(5) Grant conditions.--Grants under this subsection shall 
        be made on such conditions as the Secretary determines to be 
        necessary to carry out this subsection.
            ``(6) Application.--Each application for assistance under 
        this subsection shall include--
                    ``(A) evidence that the applicant has conducted 
                extensive planning prior to submitting the application;
                    ``(B) an assurance that the faculty and 
                administrators of all relevant departments and programs 
                served by the applicant are involved in ongoing 
                collaboration with regard to achieving the stated 
                objectives of the application;
                    ``(C) an assurance that students at the applicant 
                institutions, as appropriate, will have equal access 
                to, and derive benefits from, the program assisted 
                under this subsection; and
                    ``(D) an assurance that each institution, 
                combination or partnership will use the Federal 
                assistance provided under this subsection to supplement 
                and not supplant funds expended by the institution, 
                prior to the receipt of the Federal assistance, for 
                programs to improve undergraduate instruction in 
                international studies and foreign languages.
            ``(7) Evaluation.--The Secretary may establish requirements 
        for program evaluations and require grant recipients to submit 
        annual reports that evaluate the progress and performance of 
        students participating in programs assisted under this 
        subsection.
    ``(b) Programs of National Significance.--The Secretary may also 
award grants to public and private nonprofit agencies and 
organizations, including professional and scholarly associations, 
whenever the Secretary determines such grants will make an especially 
significant contribution to improving undergraduate international 
studies and foreign language programs.

``SEC. 605. RESEARCH; STUDIES; ANNUAL REPORT.

    ``(a) Authorized Activities.--The Secretary may, directly or 
through grants or contracts, conduct research and studies that 
contribute to achieving the purposes of this part. Such research and 
studies may include--
            ``(1) studies and surveys to determine needs for increased 
        or improved instruction in foreign language, area studies, or 
        other international fields, including the demand for foreign 
        language, area, and other international specialists in 
        government, education, and the private sector;
            ``(2) studies and surveys to assess the utilization of 
        graduates of programs supported under this title by 
        governmental, educational, and private sector organizations and 
        other studies assessing the outcomes and effectiveness of 
        programs so supported;
            ``(3) evaluation of the extent to which programs assisted 
        under this title that address national needs would not 
        otherwise be offered;
            ``(4) comparative studies of the effectiveness of 
        strategies to provide international capabilities at 
        institutions of higher education;
            ``(5) research on more effective methods of providing 
        instruction and achieving competency in foreign languages;
            ``(6) the development and publication of specialized 
        materials for use in foreign language, area studies, and other 
        international fields, or for training foreign language, area, 
        and other international specialists;
            ``(7) studies and evaluations of effective practices in the 
        dissemination of international information, materials, 
        research, teaching strategies, and testing techniques 
        throughout the education community, including elementary and 
        secondary schools; and
            ``(8) the application of performance tests and standards 
        across all areas of foreign language instruction and classroom 
        use.
    ``(b) Annual Report.--The Secretary shall prepare, publish, and 
announce an annual report listing the books and research materials 
produced with assistance under this section.

``SEC. 606. SELECTION OF CERTAIN GRANT RECIPIENTS.

    ``(a) Competitive Grants.--The Secretary shall award grants under 
section 602 competitively on the basis of criteria that separately, but 
not less rigorously, evaluates the applications for comprehensive and 
undergraduate language and area centers and programs.
    ``(b) Selection Criteria.--The Secretary shall set criteria for 
grants awarded under section 602 by which a determination of excellence 
shall be made to meet the differing objectives of graduate and 
undergraduate institutions.
    ``(c) Equitable Distribution of Grants.--The Secretary shall, to 
the extent practicable, award grants under this part (other than 
section 602) in such manner as to achieve an equitable distribution of 
the grant funds throughout the United States, based on the merit of a 
proposal as determined pursuant to a peer review process involving 
broadly representative professionals.

``SEC. 607. EQUITABLE DISTRIBUTION OF CERTAIN FUNDS.

    ``(a) Selection Criteria.--The Secretary shall make excellence the 
criterion for selection of grants awarded under section 602.
    ``(b) Equitable Distribution.--To the extent practicable and 
consistent with the criterion of excellence, the Secretary shall award 
grants under this part (other than section 602) in such a manner as 
will achieve an equitable distribution of funds throughout the United 
States.
    ``(c) Support for Undergraduate Education.--The Secretary shall 
also award grants under this part in such manner as to ensure that an 
appropriate portion of the funds appropriated for this part (as 
determined by the Secretary) are used to support undergraduate 
education.

``SEC. 608. AMERICAN OVERSEAS RESEARCH CENTERS.

    ``(a) Centers Authorized.--The Secretary is authorized to make 
grants to and enter into contracts with any American overseas research 
center that is a consortium of institutions of higher education 
(hereafter in this section referred to as a ``center'') to enable such 
center to promote postgraduate research, exchanges and area studies.
    ``(b) Use of Grants.--Grants made and contracts entered into 
pursuant to this section may be used to pay all or a portion of the 
cost of establishing or operating a center or program, including--
            ``(1) the cost of faculty and staff stipends and salaries;
            ``(2) the cost of faculty, staff, and student travel;
            ``(3) the cost of the operation and maintenance of overseas 
        facilities;
            ``(4) the cost of teaching and research materials;
            ``(5) the cost of acquisition, maintenance, and 
        preservation of library collections;
            ``(6) the cost of bringing visiting scholars and faculty to 
        a center to teach or to conduct research;
            ``(7) the cost of organizing and managing conferences; and
            ``(8) the cost of publication and dissemination of material 
        for the scholarly and general public.
    ``(c) Limitation.--The Secretary shall only award grants to and 
enter into contracts with centers under this section that--
            ``(1) receive more than 50 percent of their funding from 
        public or private United States sources;
            ``(2) have a permanent presence in the country in which the 
        center is located; and
            ``(3) are organizations described in section 501(c)(3) of 
        the Internal Revenue Code of 1986 which are exempt from 
        taxation under section 501(a) of such Code.
    ``(d) Development Grants.--The Secretary is authorized to make 
grants for the establishment of new centers. The grants may be used to 
fund activities that, within 1 year, will result in the creation of a 
center described in subsection (c).

``SEC. 609. AUTHORIZATION OF APPROPRIATIONS.

    ``There are authorized to be appropriated to carry out this part 
$80,000,000 for fiscal year 1999, and such sums as may be necessary for 
each of the 4 succeeding fiscal years.''.

SEC. 602. BUSINESS AND INTERNATIONAL EDUCATION PROGRAMS.

    Part B of title VI (20 U.S.C. 1130 et seq.) is amended--
            (1) in section 612 (20 U.S.C. 1130-1)--
                    (A) in subsection (c)--
                            (i) in paragraph (1)--
                                    (I) in subparagraph (B), by 
                                striking ``advanced''; and
                                    (II) in subparagraph (C), by 
                                striking ``evening or summer''; and
                            (ii) in paragraph (2)(C), by inserting 
                        ``foreign language,'' after ``studies,''; and
                    (B) in subsection (d)(2)(G), by inserting ``, such 
                as a representative of a community college in the 
                region served by the center'' before the period; and
            (2) in section 614 (20 U.S.C. 1130b)--
                    (A) in subsection (a), by striking ``1993'' and 
                inserting ``1999''; and
                    (B) in subsection (b), by striking ``1993'' and 
                inserting ``1999''.

SEC. 603. INSTITUTE FOR INTERNATIONAL PUBLIC POLICY.

    Part C of title VI (20 U.S.C. 1131 et seq.) is amended--
            (1) in section 621(e) (20 U.S.C. 1131(e))--
                    (A) by striking ``one-fourth'' and inserting ``one-
                half''; and
                    (B) by adding at the end the following: ``The non-
                Federal contribution shall be made from private sector 
                sources.'';
            (2) by redesignating sections 622 through 627 (20 U.S.C. 
        1131a and 1131f) as sections 623 through 628, respectively; and
            (3) by inserting after section 621 (20 U.S.C. 1131) the 
        following:

``SEC. 622. INSTITUTIONAL DEVELOPMENT.

    ``(a) In General.--The Institute shall award grants, from amounts 
available to the Institute for each fiscal year, to historically Black 
colleges and universities, Hispanic-serving institutions, tribally 
controlled community colleges, and minority institutions, to enable 
such colleges, universities, and institutions to strengthen 
international affairs programs.
    ``(b) Application.--No grant may be made by the Institute unless an 
application is made by the college, university, or institution at such 
time, in such manner, and accompanied by such information as the 
Institute may require.
    ``(c) Definitions.--In this section--
            ``(1) the term `historically Black college and university' 
        has the meaning given the term in section 322;
            ``(2) the term `Hispanic-serving institution' has the 
        meaning given the term in section 316(b);
            ``(3) the term `tribally controlled community college' has 
        the meaning given the term in section 2 of the Tribally 
        Controlled Community College Assistance Act of 1978 (25 U.S.C. 
        1801); and
            ``(4) the term `minority institution' has the meaning given 
        the term in section 1046.'';
            (4) in section 623 (as redesignated by paragraph (2))--
                    (A) in the section heading, by striking ``junior 
                year'' and inserting ``study'';
                    (B) in subsection (b)(2)--
                            (i) by inserting ``, or completing the 
                        third year of study in the case of a summer 
                        abroad program,'' after ``study''; and
                            (ii) by striking ``junior year'' and 
                        inserting ``study'';
                    (C) in subsection (c)--
                            (i) in the matter preceding paragraph (1), 
                        by striking ``junior year'' and inserting 
                        ``study'';
                            (ii) in paragraph (1), by striking ``junior 
                        year'' and inserting ``study''; and
                            (iii) in paragraph (2)--
                                    (I) by striking ``one-half'' and 
                                inserting ``one-third''; and
                                    (II) by striking ``junior year'' 
                                and inserting ``study'';
            (5) in section 627 (as redesignated by paragraph (2)) (20 
        U.S.C. 1131e), by striking ``625'' and inserting ``626''; and
            (6) in section 628 (as redesignated by paragraph (2)) (20 
        U.S.C. 1131f), by striking ``1993'' and inserting ``1999''.

SEC. 604. GENERAL PROVISIONS.

    Section 632 (20 U.S.C. 1132-1) is repealed.

        TITLE VII--RELATED PROGRAMS AND AMENDMENTS TO OTHER ACTS

                   PART A--INDIAN EDUCATION PROGRAMS

SEC. 711. TRIBALLY CONTROLLED COMMUNITY COLLEGE ASSISTANCE ACT OF 1978.

    (a) Reauthorization.--
            (1) Amount of grants.--Section 108(a)(2) of the Tribally 
        Controlled Community College Assistance Act of 1978 (25 U.S.C. 
        1808(a)(2)) is amended by striking ``$5,820'' and inserting 
        ``$6,000''.
            (2) Authorization of appropriations.--
                    (A) Title i.--Section 110(a) of the Tribally 
                Controlled Community College Assistance Act of 1978 (25 
                U.S.C. 1810(a)) is amended--
                            (i) in paragraph (1), by striking ``1993'' 
                        and inserting ``1999'';
                            (ii) in paragraph (2), by striking 
                        ``$30,000,000 for fiscal year 1993'' and 
                        inserting ``$40,000,000 for fiscal year 1999'';
                            (iii) in paragraph (3), by striking 
                        ``1993'' and inserting ``1999''; and
                            (iv) in paragraph (4), by striking ``1993'' 
                        and inserting ``1999''.
                    (B) Title iii.--Section 306(a) of the Tribally 
                Controlled Community College Assistance Act of 1978 (25 
                U.S.C. 1836(a)) is amended by striking ``1993'' and 
                inserting ``1999''.
                    (C) Title iv.--Section 403 of the Tribal Economic 
                Development and Technology Related Education Assistance 
                Act of 1990 (25 U.S.C. 1852) is amended by striking 
                ``1993'' and inserting ``1999''.
    (b) Name Change.--The Tribally Controlled Community College 
Assistance Act of 1978 (25 U.S.C. 1801 et seq.) is amended--
            (1) by striking ``community college'' each place the term 
        appears and inserting ``college or university'';
            (2) by striking ``Community College'' each place the term 
        appears (other than when such term is preceded by the term 
        ``Navajo'') and inserting ``College or University'';
            (3) by striking ``community colleges'' each place the term 
        appears and inserting ``colleges or universities'';
            (4) by striking ``such college'' each place the term 
        appears and inserting ``such college or university''; and
            (5) by striking ``community college's'' and inserting 
        ``college or university's''.

SEC. 712. AMERICAN INDIAN, ALASKA NATIVE, AND NATIVE HAWAIIAN CULTURE 
              AND ART DEVELOPMENT.

    Section 1531 of the American Indian, Alaska Native, and Native 
Hawaiian Culture and Art Development Act (20 U.S.C. 4451) is amended to 
read as follows:

``SEC. 1531. AUTHORIZATION OF APPROPRIATIONS.

    ``There is authorized to be appropriated to carry out part A 
$5,000,000 for fiscal year 1999.''.

              PART B--ADVANCED PLACEMENT INCENTIVE PROGRAM

SEC. 721. ADVANCED PLACEMENT INCENTIVE PROGRAM.

    (a) Program Established.--The Secretary of Education is authorized 
to make grants to States having applications approved under subsection 
(d), from allotments under subsection (b), to enable the States to 
reimburse low-income individuals to cover part or all of the cost of 
advanced placement test fees, if the low-income individuals--
            (1) are enrolled in an advanced placement class; and
            (2) plan to take an advanced placement test.
    (b) Allotment.--From the sum appropriated under subsection (j) for 
a fiscal year, the Secretary shall allot to each State an amount that 
bears the same relation to the sum as the number of low-income 
individuals in the State bears to the number of low-income individuals 
in all States.
    (c) Information Dissemination.--The State educational agency may 
use not more than 5 percent of grant funds received for a fiscal year 
to disseminate information regarding the availability of test fee 
payments under this section to eligible individuals through secondary 
school teachers and guidance counselors.
    (d) Requirements for Approval of Applications.--In approving 
applications for grants the Secretary of Education shall--
            (1) require that each such application contain a 
        description of the advance placement test fees the State will 
        pay on behalf of individual students;
            (2) require an assurance that any funds received under this 
        section, other than funds used in accordance with subsection 
        (c), shall be used only to pay advanced placement test fees; 
        and
            (3) contain such information as the Secretary may require 
        to demonstrate that the State will ensure that a student is 
        eligible for payments under this section, including the 
        documentation required by chapter 1 of subpart 2 of part A of 
        title IV of the Higher Education Act of 1965 (20 U.S.C. 1070a-
        11 et seq.).
    (e) Funding Rule.--Funds provided under this section shall be used 
to supplement and not supplant other Federal, State, local or private 
funds available to assist low-income individuals in paying for advanced 
placement testing, except that such funds may be used to supplant the 
funds so available if the funds used to supplant are used to increase 
the participation of low-income individuals in advanced placement 
courses through teacher training and other activities directly related 
to increasing the availability of advanced placement courses.
    (f) Special Rule.--The Secretary of Education shall only award 
grants under this section for a fiscal year if the amount the College 
Board spends for the College Board's fee assistance program for low-
income students for the fiscal year is not less than the amount the 
College Board spent for such program for the preceding fiscal year.
    (g) Regulations.--The Secretary of Education shall prescribe such 
regulations as are necessary to carry out this section.
    (h) Report.--Each State annually shall report to the Secretary of 
Education regarding--
            (1) the number of low-income individuals in the State who 
        receive assistance under this section; and
            (2) the teacher training and other activities described in 
        subsection (e).
    (i) Definition.--In this section:
            (1) Advanced placement test.--The term ``advanced placement 
        test'' includes only an advanced placement test approved by the 
        Secretary of Education for the purposes of this section.
            (2) Low-income individual.--The term ``low-income 
        individual'' has the meaning given the term in section 
        402A(g)(2) of the Higher Education Act of 1965 (20 U.S.C. 
        1070a-11(g)(2)).
    (j) Authorization of Appropriations.--There are authorized to be 
appropriated $10,000,000 for fiscal year 1999 and such sums as may be 
necessary for each of the 4 succeeding fiscal years to carry out this 
section.

                      PART C--INSTITUTE FOR PEACE

SEC. 731. AUTHORITIES OF THE UNITED STATES INSTITUTE OF PEACE.

    The United States Institute of Peace Act (22 U.S.C. 4601 et seq.) 
is amended--
            (1) in section 1705 (22 U.S.C. 4604)--
                    (A) in subsection (f), by inserting ``personal 
                service and other'' after ``may enter into''; and
                    (B) in subsection (o), by inserting after 
                ``Services'' the following: ``and use all sources of 
                supply and services of the General Services 
                Administration'';
            (2) in section 1706(e)(4) (22 U.S.C. 4605(e)(4)), by adding 
        at the end the following: ``Service under an appointment of 
        less than 4 years shall not be treated as a term for purposes 
        of this paragraph.'';
            (3) in section 1710(a)(1) (22 U.S.C. 4609(a)(1)), by 
        striking ``1993'' and inserting ``1999''; and
            (4) in the second and third sentences of section 1712 (22 
        U.S.C. 4611), by striking ``shall'' each place it appears and 
        inserting ``may''.

               PART D--COMMUNITY SCHOLARSHIP MOBILIZATION

SEC. 741. SHORT TITLE.

    This part may be cited as the ``Community Scholarship Mobilization 
Act.''

SEC. 742. FINDINGS.

    Congress finds that--
            (1) the local community, when properly organized and 
        challenged, is one of the best sources of academic support, 
        motivation toward achievement, and financial resources for 
        aspiring postsecondary students;
            (2) local communities, working to complement or augment 
        services currently offered by area schools and colleges, can 
        raise the educational expectations and increase the rate of 
        postsecondary attendance of their youth by forming locally-
        based organizations that provide both academic support 
        (including guidance, counseling, mentoring, tutoring, 
        encouragement, and recognition) and tangible, locally raised, 
        effectively targeted, publicly recognized, financial 
        assistance;
            (3) proven methods of stimulating these community efforts 
        can be promoted through Federal support for the establishment 
        of regional, State or community program centers to organize and 
        challenge community efforts to develop educational incentives 
        and support for local students; and
            (4) using Federal funds to leverage private contributions 
        to help students from low-income families attain educational 
        and career goals is an efficient and effective investment of 
        scarce taxpayer-provided resources.

SEC. 743. DEFINITIONS.

    In this part:
            (1) Regional, state or community program center.--The term 
        ``regional, State or community program center'' means an 
        organization that--
                    (A) is a division of, responsible to, and overseen 
                by, the national organization; and
                    (B) is staffed by professionals trained to create, 
                develop, and sustain local entities in towns, cities, 
                and neighborhoods.
            (2) Local entity.--The term ``local entity'' means an 
        organization that--
                    (A) is a nonprofit organization that is described 
                in section 501(c)(3) of the Internal Revenue Code of 
                1986, and exempt from taxation under section 501(a) of 
                such Code (or shall meet this criteria through 
                affiliation with the national organization);
                    (B) is formed for the purpose of providing 
                educational scholarships and academic support for 
                residents of the local community served by such 
                organization;
                    (C) solicits broad-based community support in its 
                academic support and fund-raising activities;
                    (D) is broadly representative of the local 
                community in the structures of its volunteer-operated 
                organization and has a board of directors that includes 
                leaders from local neighborhood organizations and 
                neighborhood residents, such as school or college 
                personnel, parents, students, community agency 
                representatives, retirees, and representatives of the 
                business community;
                    (E) awards scholarships without regard to age, sex, 
                marital status, race, creed, color, religion, national 
                origin or disability; and
                    (F) gives priority to awarding scholarships for 
                postsecondary education to deserving students from low-
                income families in the local community.
            (3) National organization.--The term ``national 
        organization'' means an organization that--
                    (A) has the capacity to create, develop and sustain 
                local entities and affiliated regional, State or 
                community program centers;
                    (B) has the capacity to sustain newly created local 
                entities in towns, cities, and neighborhoods through 
                ongoing training support programs;
                    (C) is described in section 501(c)(3) of the 
                Internal Revenue Code of 1986, and exempt from taxation 
                under section 501(a) of such Code;
                    (D) is a publicly supported organization within the 
                meaning of section 170(b)(1)(A)(iv) of such Code;
                    (E) ensures that each of the organization's local 
                entities meet the criteria described in subparagraphs 
                (C) and (D); and
                    (F) has a program for or experience in cooperating 
                with secondary and postsecondary institutions in 
                carrying out the organization's scholarship and 
                academic support activities.
            (4) High poverty area.--The term ``high poverty area'' 
        means a community with a higher percentage of children from 
        low-income families than the national average of such 
        percentage and a lower percentage of children pursuing 
        postsecondary education than the national average of such 
        percentage.
            (5) Students from low-income families.--The term ``students 
        from low-income families'' means students determined, pursuant 
        to part F of title IV of the Higher Education Act of 1965 (20 
        U.S.C. 1087kk et seq.), to be eligible for a Federal Pell Grant 
        under subpart 1 of part A of title IV of such Act (20 U.S.C. 
        1070a).

SEC. 744. PURPOSE, ENDOWMENT GRANT AUTHORITY.

    (a) Purpose.--It is the purpose of this part to establish and 
support regional, State or community program centers to enable such 
centers to foster the development of local entities in high poverty 
areas that promote higher education goals for students from low-income 
families by--
            (1) providing academic support, including guidance, 
        counseling, mentoring, tutoring, and recognition; and
            (2) providing scholarship assistance for the cost of 
        postsecondary education.
    (b) Endowment Grant Authority.--From the funds appropriated 
pursuant to the authority of section 746, the Secretary shall award an 
endowment grant, on a competitive basis, to a national organization to 
enable such organization to support the establishment or ongoing work 
of regional, State or community program centers that foster the 
development of local entities in high poverty areas to improve high 
school graduation rates and postsecondary attendance through the 
provision of academic support services and scholarship assistance for 
the cost of postsecondary education.

SEC. 745. GRANT AGREEMENT AND REQUIREMENTS.

    (a) In General.--The Secretary shall award one or more endowment 
grants described in section 744(b) pursuant to an agreement between the 
Secretary and a national organization. Such agreement shall--
            (1) require the national organization to establish an 
        endowment fund in the amount of the grant, the corpus of which 
        shall remain intact and the interest income from which shall be 
        used to support the activities described in paragraphs (2) and 
        (3);
            (2) require the national organization to use 70 percent of 
        the interest income from the endowment fund in any fiscal year 
        to support the establishment or ongoing work of regional, State 
        or community program centers to enable such centers to work 
        with local communities to establish local entities in high 
        poverty areas and provide ongoing technical assistance, 
        training workshops, and other activities to help ensure the 
        ongoing success of the local entities;
            (3) require the national organization to use 30 percent of 
        the interest income from the endowment fund in any fiscal year 
        to provide scholarships for postsecondary education to students 
        from low-income families, which scholarships shall be matched 
        on a dollar-for-dollar basis from funds raised by the local 
        entities;
            (4) require that at least 50 percent of all the interest 
        income from the endowment be allocated to establish new local 
        entities or support regional, State or community program 
        centers in high poverty areas;
            (5) require the national organization to submit, for each 
        fiscal year in which such organization uses the interest from 
        the endowment fund, a report to the Secretary that contains--
                    (A) a description of the programs and activities 
                supported by the interest on the endowment fund;
                    (B) the audited financial statement of the national 
                organization for the preceding fiscal year;
                    (C) a plan for the programs and activities to be 
                supported by the interest on the endowment fund as the 
                Secretary may require; and
                    (D) an evaluation of the programs and activities 
                supported by the interest on the endowment fund as the 
                Secretary may require; and
                    (E) data indicating the number of students from 
                low-income families who receive scholarships from local 
                entities, and the amounts of such scholarships;
            (6) contain such assurances as the Secretary may require 
        with respect to the management and operation of the endowment 
        fund; and
            (7) contain an assurance that if the Secretary determines 
        that such organization is not in substantial compliance with 
        the provisions of this part, then the national organization 
        shall pay to the Secretary an amount equal to the corpus of the 
        endowment fund plus any accrued interest on such fund that is 
        available to the national organization on the date of such 
        determination.
    (b) Returned Funds.--All funds returned to the Secretary pursuant 
to subsection (a)(7) shall be available to the Secretary to carry out 
any scholarship or grant program assisted under title IV of the Higher 
Education Act of 1965 (20 U.S.C. 1070 et seq.).

SEC. 746. AUTHORIZATION OF APPROPRIATIONS.

    There are authorized to be appropriated to carry out this part 
$10,000,000 for fiscal year 2000.

    PART E--GRANTS TO STATES FOR WORKPLACE AND COMMUNITY TRANSITION 
               TRAINING FOR INCARCERATED YOUTH OFFENDERS

SEC. 751. GRANTS TO STATES FOR WORKPLACE AND COMMUNITY TRANSITION 
              TRAINING FOR INCARCERATED YOUTH OFFENDERS.

    (a) Findings.--Congress makes the following findings:
            (1) Over 150,000 youth offenders age 21 and younger are 
        incarcerated in the Nation's jails, juvenile facilities, and 
        prisons.
            (2) Most youth offenders who are incarcerated have been 
        sentenced as first-time adult felons.
            (3) Approximately 75 percent of youth offenders are high 
        school dropouts who lack basic literacy and life skills, have 
        little or no job experience, and lack marketable skills.
            (4) The average incarcerated youth has attended school only 
        through grade 10.
            (5) Most of these youths can be diverted from a life of 
        crime into productive citizenship with available educational, 
        vocational, work skills, and related service programs.
            (6) If not involved with educational programs while 
        incarcerated, almost all of these youths will return to a life 
        of crime upon release.
            (7) The average length of sentence for a youth offender is 
        about 3 years. Time spent in prison provides a unique 
        opportunity for education and training.
            (8) Even with quality education and training provided 
        during incarceration, a period of intense supervision, support, 
        and counseling is needed upon release to ensure effective 
        reintegration of youth offenders into society.
            (9) Research consistently shows that the vast majority of 
        incarcerated youths will not return to the public schools to 
        complete their education.
            (10) There is a need for alternative educational 
        opportunities during incarceration and after release.
    (b) Definition.--For purposes of this part, the term ``youth 
offender'' means a male or female offender under the age of 25, who is 
incarcerated in a State prison, including a prerelease facility.
    (c) Grant Program.--The Secretary of Education (in this section 
referred to as the ``Secretary'') shall establish a program in 
accordance with this section to provide grants to the State 
correctional education agencies in the States, from allocations for the 
States under subsection (i), to assist and encourage incarcerated 
youths to acquire functional literacy, life, and job skills, through 
the pursuit of a postsecondary education certificate, or an associate 
of arts or bachelor's degree while in prison, and employment counseling 
and other related services which start during incarceration and 
continue through prerelease and while on parole.
    (d) Application.--To be eligible for a grant under this section, a 
State correctional education agency shall submit to the Secretary a 
proposal for a youth offender program that--
            (1) identifies the scope of the problem, including the 
        number of incarcerated youths in need of postsecondary 
        education and vocational training;
            (2) lists the accredited public or private educational 
        institution or institutions that will provide postsecondary 
        educational services;
            (3) lists the cooperating agencies, public and private, or 
        businesses that will provide related services, such as 
        counseling in the areas of career development, substance abuse, 
        health, and parenting skills;
            (4) describes the evaluation methods and performance 
        measures that the State correctional education agency will 
        employ, which methods and measures--
                    (A) shall be appropriate to meet the goals and 
                objectives of the proposal; and
                    (B) shall include measures of--
                            (i) program completion;
                            (ii) student academic and vocational skill 
                        attainment;
                            (iii) success in job placement and 
                        retention; and
                            (iv) recidivism;
            (5) describes how the proposed programs are to be 
        integrated with existing State correctional education programs 
        (such as adult education, graduate education degree programs, 
        and vocational training) and State industry programs;
            (6) addresses the educational needs of youth offenders who 
        are in alternative programs (such as boot camps); and
            (7) describes how students will be selected so that only 
        youth offenders eligible under subsection (f) will be enrolled 
        in postsecondary programs.
    (e) Program Requirements.--Each State correctional education agency 
receiving a grant under this section shall--
            (1) integrate activities carried out under the grant with 
        the objectives and activities of the school-to-work programs of 
        such State, including--
                    (A) work experience or apprenticeship programs;
                    (B) transitional worksite job training for 
                vocational education students that is related to the 
                occupational goals of such students and closely linked 
                to classroom and laboratory instruction;
                    (C) placement services in occupations that the 
                students are preparing to enter;
                    (D) employment-based learning programs; and
                    (E) programs that address State and local labor 
                shortages;
            (2) annually report to the Secretary and the Attorney 
        General on the results of the evaluations conducted using the 
        methods and performance measures contained in the proposal; and
            (3) provide to each State for each student eligible under 
        subsection (f) not more than $1,500 annually for tuition, 
        books, and essential materials, and not more than $300 annually 
        for related services such as career development, substance 
        abuse counseling, parenting skills training, and health 
        education, for each eligible incarcerated youth.
    (f) Student Eligibility.--A youth offender shall be eligible for 
participation in a program receiving a grant under this section if the 
youth offender--
            (1) is eligible to be released within 5 years (including a 
        youth offender who is eligible for parole within such time); 
        and
            (2) is 25 years of age or younger.
    (g) Length of Participation.--A State correctional education agency 
receiving a grant under this section shall provide educational and 
related services to each participating youth offender for a period not 
to exceed 5 years, 1 year of which may be devoted to study in a 
graduate education degree program or to remedial education services for 
students who have obtained a secondary school diploma. Educational and 
related services shall start during the period of incarceration in 
prison or prerelease and may continue during the period of parole.
    (h) Education Delivery Systems.--State correctional education 
agencies and cooperating institutions shall, to the extent practicable, 
use high-tech applications in developing programs to meet the 
requirements and goals of this section.
    (i) Allocation of Funds.--From the amounts appropriated pursuant to 
subsection (j), the Secretary shall allot to each State an amount that 
bears the same relationship to such funds as the total number of 
students eligible under subsection (f) in such State bears to the total 
number of such students in all States.
    (j) Authorization of Appropriations.--There are authorized to be 
appropriated to carry out this section $14,000,000 for fiscal year 1999 
and such sums as may be necessary for each of the 4 succeeding fiscal 
years.

                     PART F--EDUCATION OF THE DEAF

SEC. 761. SHORT TITLE.

    This part may be cited as the ``Education of the Deaf Amendments of 
1998''.

SEC. 762. ELEMENTARY AND SECONDARY EDUCATION PROGRAMS.

    Section 104(b) of the Education of the Deaf Act of 1986 (20 U.S.C. 
4034(b)) is amended--
            (1) in paragraph (1)--
                    (A) in subparagraph (A), by inserting ``and'' after 
                the semicolon;
                    (B) in subparagraph (B), by striking ``; and'' and 
                inserting a period; and
                    (C) by striking subparagraph (C);
            (2) in the matter preceding subparagraph (A) of paragraph 
        (2)--
                    (A) by striking ``paragraph (1)'' and inserting 
                ``paragraph (1)(B)''; and
                    (B) by striking ``section 618(b)'' and inserting 
                ``section 618(a)(1)(A)'';
            (3) in paragraph (3), by striking ``intermediate 
        educational unit'' and inserting ``educational service 
        agency'';
            (4) in paragraph (4)--
                    (A) in subparagraph (A), by striking ``intermediate 
                educational unit'' and inserting ``educational service 
                agency''; and
                    (B) in subparagraph (B), by striking ``intermediate 
                educational units'' and inserting ``educational service 
                agencies''; and
            (5) by amending subparagraph (C) to read as follows:
                    ``(C) provide the child a free appropriate public 
                education in accordance with part B of the Individuals 
                with Disabilities Education Act and procedural 
                safeguards in accordance with the following provisions 
                of section 615 of such Act:
                            ``(i) paragraphs (1), and (3) through (6), 
                        of subsection (b).
                            ``(ii) Subsections (c) through (g).
                            ``(iii) Subsection (h), except for the 
                        matter in paragraph (4) pertaining to 
                        transmission of findings and decisions to a 
                        State advisory panel.
                            ``(iv) Paragraphs (1) and (2) of subsection 
                        (i).
                            ``(v) Subsection (j)--
                                    ``(I) except that such subsection 
                                shall not be applicable to a decision 
                                by the University to refuse to admit a 
                                child; or
                                    ``(II) to dismiss a child, except 
                                that, before dismissing any child, the 
                                University shall give at least 60 days 
                                written notice to the child's parents 
                                and to the local educational agency in 
                                which the child resides, unless the 
                                dismissal involves a suspension, 
                                expulsion, or other change in placement 
                                covered under section 615(k).
                            ``(vi) Subsections (k) through (m).''.

SEC. 763. AGREEMENT WITH GALLAUDET UNIVERSITY.

    Section 105(a) of the Education of the Deaf Act of 1986 (20 U.S.C. 
4305(a)) is amended--
            (1) by striking ``within 1 year after enactment of the 
        Education of the Deaf Act Amendments of 1992, a new'' and 
        inserting ``and periodically update, an''; and
            (2) by amending the second sentence to read as follows: 
        ``The Secretary or the University shall determine the necessity 
        for the periodic update described in the preceding sentence.''.

SEC. 764. AGREEMENT FOR THE NATIONAL TECHNICAL INSTITUTE FOR THE DEAF.

    Paragraph (2) of section 112(a) of the Education of the Deaf Act of 
1986 (20 U.S.C. 4332(a)) is amended to read as follows:
    ``(2) The Secretary and the institution of higher education with 
which the Secretary has an agreement under this section--
            ``(A) shall periodically assess the need for modification 
        of the agreement; and
            ``(B) shall periodically update the agreement as determined 
        necessary by the Secretary or the institution.''.

SEC. 765. DEFINITIONS.

    Section 201 of the Education of the Deaf Act of 1986 (20 U.S.C. 
4351) is amended--
            (1) in paragraph (1)(C), by striking ``Palau (but only 
        until the Compact of Free Association with Palau takes 
        effect),''; and
            (2) in paragraph (5)--
                    (A) by inserting ``and'' after ``Virgin Islands,''; 
                and
                    (B) by striking ``, and Palau (but only until the 
                Compact of Free Association with Palau takes effect)''.

SEC. 766. GIFTS.

    Subsection (b) of section 203 of the Education of the Deaf Act of 
1986 (20 U.S.C. 4353) is amended to read as follows:
    ``(b) Independent Financial and Compliance Audit.--
            ``(1) In general.--Gallaudet University shall have an 
        annual independent financial and compliance audit made of the 
        programs and activities of the University, including the 
        national mission and school operations of the elementary and 
        secondary education programs at Gallaudet. The institution of 
        higher education with which the Secretary has an agreement 
        under section 112 shall have an annual independent financial 
        and compliance audit made of the programs and activities of 
        such institution of higher education, including NTID, and 
        containing specific schedules and analyses for all NTID funds, 
        as determined by the Secretary.
            ``(2) Compliance.--As used in paragraph (1), compliance 
        means compliance with sections 102(b), 105(b)(4), 112(b)(5), 
        and 203(c), paragraphs (2) and (3) of section 207(b), 
        subsections (b)(2), (b)(3), and (c) through (f), of section 
        207, and subsections (b) and (c) of section 210.
            ``(3) Submission of audits.--A copy of each audit described 
        in paragraph (1) shall be provided to the Secretary within 15 
        days of acceptance of the audit by the University or the 
        institution authorized to establish and operate the NTID under 
        section 112(a), as the case may be, but not later than January 
        10 of each year.''.

SEC. 767. REPORTS.

    Section 204(3) of the Education of the Deaf Act of 1986 (20 U.S.C. 
4354(3)) is amended--
            (1) in subparagraph (A), by striking ``The annual'' and 
        inserting ``A summary of the annual''; and
            (2) in subparagraph (B), by striking ``the annual'' and 
        inserting ``a summary of the annual''.

SEC. 768. MONITORING, EVALUATION, AND REPORTING.

    Section 205(c) of the Education of the Deaf Act of 1986 (20 U.S.C. 
4355(c)) is amended by striking ``1993, 1994, 1995, 1996, and 1997'' 
and inserting ``1998 through 2003''.

SEC. 769. INVESTMENTS.

    Section 207 of the Education of the Deaf Act of 1986 (20 U.S.C. 
4357) is amended--
            (1) in subsection (c)(1), by inserting ``the Federal 
        contribution of'' after ``shall invest'';
            (2) in subsection (d)(3)(A), by striking ``prior'' and 
        inserting ``current''; and
            (3) in subsection (h)--
                    (A) in paragraph (1), by striking ``1993 through 
                1997'' and inserting ``1998 through 2003''; and
                    (B) in paragraph (2), by striking ``1993 through 
                1997'' and inserting ``1998 through 2003''.

SEC. 770. INTERNATIONAL STUDENTS.

    Section 210(a) of the Education of the Deaf Act of 1986 (20 U.S.C. 
4359a(a)) is amended by inserting before the period ``, except that in 
any school year no United States citizen who is qualified to be 
admitted to the University or NTID and applies for admission to the 
University or NTID shall be denied admission because of the admission 
of an international student''.

SEC. 771. RESEARCH PRIORITIES.

    Section 211 of the Education of the Deaf Act of 1986 (20 U.S.C. 
4360) is amended to read as follows:

``SEC. 211. RESEARCH PRIORITIES.

    ``(a) Research Priorities.--Gallaudet University and the National 
Technical Institute for the Deaf shall each establish and disseminate 
priorities, that reflect public input, through a process that includes 
consumers, constituent groups, and the heads of other federally funded 
programs. The priorities for the University shall include activities 
conducted as part of the University's elementary and secondary 
education programs under section 104.
    ``(b) Research Reports.--The University and NTID shall each prepare 
and submit an annual research report, to the Secretary, the Committee 
on Education and the Workforce of the House of Representatives, and the 
Committee on Labor and Human Resources of the Senate, not later than 
January 10 of each year, that shall include--
            ``(1) a summary of the public input received as part of the 
        establishment and dissemination of priorities required by 
        subsection (a), and the University's and NTID's response to the 
        input; and
            ``(2) a summary description of the research undertaken by 
        the University and NTID, the start and projected end dates for 
        each research project, the projected cost and source or sources 
        of funding for each project, and any products resulting from 
        research completed in the prior fiscal year.''.

SEC. 772. AUTHORIZATION OF APPROPRIATIONS.

    Title II of the Education of the Deaf Act of 1986 (20 U.S.C. 4351 
et seq.) is amended by adding at the end the following:

``SEC. 212. AUTHORIZATION OF APPROPRIATIONS.

    ``(a) Gallaudet University.--There are authorized to be 
appropriated such sums as may be necessary for each of the fiscal years 
1998 through 2003 to carry out the provisions of titles I and II, 
relating to--
            ``(1) Gallaudet University;
            ``(2) Kendall Demonstration Elementary School; and
            ``(3) the Model Secondary School for the Deaf.
    ``(b) National Technical Institute for the Deaf.--There are 
authorized to be appropriated such sums as may be necessary for each of 
the fiscal years 1998 through 2003 to carry out the provisions of 
titles I and II relating to the National Technical Institute for the 
Deaf.''.

SEC. 773. COMMISSION ON EDUCATION OF THE DEAF.

    The Education of the Deaf Act of 1986 (20 U.S.C. 4301 et seq.) is 
amended by adding at the end the following:

            ``TITLE III--COMMISSION ON EDUCATION OF THE DEAF

``SEC. 301. COMMISSION ESTABLISHED.

    ``(a) Establishment.--
            ``(1) In general.--The Secretary shall establish a 
        Commission on the Education of the Deaf to identify those 
        education-related factors in the lives of individuals who are 
        deaf that result in barriers to successful postsecondary 
        education experiences and employment, and those education-
        related factors in the lives of individuals who are deaf that 
        contribute to successful postsecondary education experiences 
        and employment.
            ``(2) Definition of individuals who are deaf.--In this 
        title, the term `individuals who are deaf' means all persons 
        with hearing impairments, including those who are hard-of-
        hearing, those deafened later in life, and those who are 
        profoundly deaf.
    ``(b) Composition.--
            ``(1) In general.--The Commission shall be composed of 13 
        members appointed by the Secretary from recommendations made by 
        the National Association of the Deaf, the American Society for 
        Deaf Children, the Alexander Graham Bell Association, the 
        President of Gallaudet, the Vice President of the National 
        Technical Institute for the Deaf, State Schools for the Deaf, 
        projects to train teachers of the deaf funded under section 
        673(b) of the Individuals with Disabilities Education Act, 
        parent training and information centers funded under section 
        682 of such Act, the Regional Centers on Postsecondary 
        Education for Individuals who are Deaf funded under section 672 
of such Act, Self-Help for Hard of Hearing People, and the Cothe 
Council on Education of the Deaf.
            ``(2) Qualifications.--
                    ``(A) In general.--Members of the Commission shall 
                be appointed from among individuals who have broad 
                experience and expertise in deafness, program 
                evaluation, education, rehabilitation, and job training 
                generally, which expertise and experience shall be 
                directly relevant to the issues to be addressed by the 
                Commission.
                    ``(B) Deaf individuals.--At least \1/3\ of members 
                of the Commission shall be individuals who are deaf.
                    ``(C) Chairperson.--The chairperson of the 
                Commission shall be elected by a simple majority of the 
                Commission.
                    ``(D) Assistant secretary.--One member of the 
                Commission shall be the Assistant Secretary for Special 
                Education and Rehabilitative Services.
            ``(3) Date.--Members of the Commission shall be appointed 
        not later than 90 days after the date of enactment of the 
        Education of the Deaf Amendments of 1998.

``SEC. 302. DUTIES, REPORT, AND DURATION OF THE COMMISSION.

    ``(a) Identification of Factors.--The Commission shall identify, 
with respect to individuals who are deaf, factors that pose barriers to 
or factors that facilitate--
            ``(1) educational performance and progress of students who 
        are deaf in high school;
            ``(2) educational performance and progress of students who 
        are deaf in postsecondary education;
            ``(3) career exploration and selection;
            ``(4) job performance and satisfaction in initial 
        postsecondary employment; and
            ``(5) career advancement and satisfaction.
    ``(b) Report.--The Commission shall report to the President and 
Congress such interim reports that the Commission deems appropriate, 
and not later than 18 months after the date of enactment of the 
Education of the Deaf Amendments of 1998, a final report containing the 
findings of the Commission with respect to the factors identified under 
subsection (a). The final report shall include recommendations, 
including legislative proposals, that the Commission deems advisable.
    ``(c) Termination.--The Commission shall terminate 90 days after 
the date on which the Commission submits the Commission's final report 
described in subsection (b).

``SEC. 303. ADMINISTRATIVE PROVISIONS.

    ``(a) Personnel.--
            ``(1) In general.--The Commission may appoint such 
        personnel, including a staff director, as the Commission deems 
        necessary without regard to the provisions of title 5, United 
        States Code, except that the rate pay for any employee of the 
        Commission may not exceed the rate payable for level V of the 
        Executive Schedule under section 5316 of title 5, United States 
        Code.
            ``(2) Procurement of temporary and intermittent services.--
        The Chairperson of the Commission may procure temporary and 
        intermittent services under section 3109(b) of title 5, United 
        States Code, at rates for individuals which do not exceed the 
        daily equivalent of the annual rate of basic pay prescribed for 
        level V of the Executive Schedule under section 5316 of such 
        title.
    ``(b) Hearings; Quorum.--
            ``(1) Hearings.--The Commission or, with the authorization 
        of the Commission, any committee of the Commission, may, for 
        the purpose of carrying out the provisions of this title, hold 
        such hearings, sit, and act at such times and such places in 
        the United States as the Commission or such committee may deem 
        advisable.
            ``(2) Quorum.--Seven members of the Commission shall 
        constitute a quorum, but 2 or more members may conduct 
        hearings.
            ``(3) Hearings and public input.--In conducting hearings 
        and acquiring public input under this title, the Commission may 
        use various telecommunications media, including 
        teleconferencing, video-conferencing, the Internet, and other 
        media.
    ``(c) Consultation; Information and Statistics; Agency 
Cooperation.--
            ``(1) In general.--In carrying out the Commission's duties 
        under this title and to the extent not prohibited by Federal 
        law, the Commission is authorized to secure consultation, 
        information, statistics, and cooperation from Federal agencies, 
        entities funded by the Federal Government, and other entities 
        the Commission deems advisable.
            ``(2) Special rule.--The Commission is authorized to use, 
        with their consent, the services, personnel, information, and 
        facilities of other Federal, State, local, and private agencies 
with or without reimbursement.

``SEC. 304. COMPENSATION OF MEMBERS.

    ``(a) United States Officer and Employee Members.--Members of the 
Commission who are officers or full-time employees of the United States 
shall serve without compensation in addition to that received for their 
services as officers or employees of the United States; but may be 
allowed travel expenses, including per diem in lieu of subsistence, at 
rates authorized for employees of agencies under subchapter I of 
chapter 57 of title 5, United States Code, while away from their homes 
or regular places of business in the performance of services for the 
Commission.
    ``(b) Public Members.--Members of the Commission who are not 
officers or full-time employees of the United States shall receive 
compensation at a rate that does not exceed the daily rate payable for 
level V of the Executive Schedule under section 5316 of title 5, United 
States Code, for each day (including travel time) during which such 
members are engaged in the actual performance of the duties of the 
Commission. In addition, such members may be allowed travel expenses, 
including per diem in lieu of subsistence, at rates authorized for 
employees of agencies under subchapter I of chapter 57 of title 5, 
United States Code, while away from their homes or regular places of 
business in the performance of services for the Commission.

``SEC. 305. AUTHORIZATIONS OF APPROPRIATIONS.

    ``There is authorized to be appropriated to carry out this title 
such sums as may be necessary for each of the fiscal years 1999 and 
2000.''.

                            PART G--REPEALS

SEC. 781. REPEALS.

    (a) Higher Education Act of 1965.--The following provisions of the 
Act (20 U.S.C. 1001 et seq.) are repealed:
            (1) The heading for, sections 701 and 702 of, and parts A, 
        C, D, and E of, title VII (20 U.S.C. 1132a, 1132a-1, 1132b et 
        seq., 1132d et seq., 1132f et seq., and 1132i et seq.).
            (2) Title VIII (20 U.S.C. 1133 et seq.).
            (3) The heading for, section 901 of, and parts A, B, E, F, 
        and G of, title IX (20 U.S.C. 1134, 1134a et seq., 1134d et 
        seq., 1134r et seq., 20 U.S.C. 1134s et seq., and 1134u et 
        seq.).
            (4) The heading for, subpart 2 of part B of, and parts C, D 
        and E of, title X (20 U.S.C. 1135c et seq., 1135e et seq., 
        1135f, and 1135g et seq.).
            (5) The heading for, and part B of, title XI (20 U.S.C. 
        1137 et seq.).
    (b) Higher Education Amendments of 1992.--The following provisions 
of the Higher Education Amendments of 1992 (Public Law 102-325; 106 
Stat 448) are repealed:
            (1) Parts E, F, and G of title XIII of the Higher Education 
        Amendments of 1992 (25 U.S.C. 3332 et seq., 3351 et seq., 3371) 
        are repealed.
            (2) Title XIV.
            (3) Title XV.

                         PART H--MISCELLANEOUS

SEC. 791. YEAR 2000 COMPUTER PROBLEM.

    (a) Sense of Congress.--With the year 2000 fast approaching, it is 
the sense of Congress that the Department of Education should--
            (1) assess immediately the extent of the risk to the 
        operations of the student financial aid system posed by the 
        year 2000 computer problem;
            (2) give the highest priority to correcting all 2-digit 
        date-related problems in the Department's computer systems to 
        ensure that those systems continue to operate effectively in 
        the year 2000 and beyond; and
            (3) develop contingency plans, with respect to the year 
        2000 computer problem, for those computer systems that the 
        Department is unable to correct in time.
    (b) Report Required.--Not later than March 1, 1999, the Secretary 
of Education shall provide a report to the Committee on Labor and Human 
Resources of the Senate and the Committee on Education and the 
Workforce of the House of Representatives describing the compliance 
status of all mission critical systems at the Department, and 
contingency plans for those computer systems in the Department that the 
Department will be unable to correct in time, with respect to the year 
2000 computer problem.
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