Findings

The Congress finds the following: (1)The United States can have a secure and prosperous future only by having a robust and inventive scientific and technical enterprise. (2)Such an enterprise will require the United States to produce more scientists and engineers. (3)The United States education system must do more to encourage students at every level to study science and mathematics and to pursue careers related to those fields. (4)The current performance of United States students in science and math lags behind their international peers, and not enough students are pursuing science and mathematics. (5)The United States is still reaping the benefits of past investments in research and development and education, but we are drawing down that capital. (6)The United States needs to recommit itself to leadership in science, mathematics and engineering, especially as advances are being made in such areas as nanotechnology. (7)A program of loan forgiveness designed to attract students to careers in science, mathematics, engineering and technology, including teaching careers, can help the United States maintain its technological leadership.

Establishment of program

(a)

Program

(1)

In general

The Secretary shall carry out a program of assuming the obligation to pay, pursuant to the provisions of this Act, the interest on a loan made, insured, or guaranteed under part B or D of title IV of the Higher Education Act of 1965. (2)

Eligibility

The Secretary may assume interest payments under paragraph (1) only for a borrower who— (A)has submitted an application in compliance with subsection (d); (B)obtained one or more loans described in paragraph (1) as an undergraduate student; (C)is a new borrower (within the meaning of section 103(7) of the Higher Education Act of 1965 (20 U.S.C 1003(7)) on or after the date of enactment of this Act; (D)is a teacher of science, technology, engineering or mathematics at an elementary or secondary school, or is a mathematics, science or engineering professional; and (E)enters into an agreement with the Secretary to complete 5 consecutive years of service in a position described in subparagraph (D), starting on the date of the agreement. (3)

Prior interest limitations

The Secretary shall not make any payments for interest that— (A)accrues prior to the beginning of the repayment period on a loan in the case of a loan made under section 428H or a Federal Direct Unsubsidized Stafford Loan; or (B)has accrued prior to the signing of an agreement under paragraph (2)(E). (4)

Initial selection

In selecting participants for the program under this Act, the Secretary— (A)shall choose among eligible applicants on the basis of— (i)the national security, homeland security and economic security needs of the United States, as determined by the Secretary, in consultation with other Federal agencies, including the Departments of Labor, Defense, Homeland Security, Commerce, and Energy, the Central Intelligence Agency and the National Science Foundation; and (ii)the academic record or job performance of the applicant; and (B)may choose among eligible applicants on the basis of— (i)the likelihood of the applicant to complete the five-year service obligation; (ii)the likelihood of the applicant to remain in science, mathematics or engineering after the completion of the service requirement; or (iii)other relevant criteria determined by the Secretary. (5)

Availability subject to appropriations

Loan interest payments under this Act shall be subject to the availability of appropriations. If the amount appropriated for any fiscal year is not sufficient to provide interest payments on behalf of all qualified applicants, the Secretary shall give priority to those individuals on whose behalf interest payments were made during the preceding fiscal year. (6)

Regulations

The Secretary is authorized to prescribe such regulations as may be necessary to carry out the provisions of this section. (b)

Duration and amount of interest payments

The period during which the Secretary shall pay interest on behalf of a student borrower who is selected under subsection (a) is the period that begins on the effective date of the agreement under subsection (a)(2)(E), continues after successful completion of the service obligation, and ends on the earlier of— (1)the completion of the repayment period of the loan; (2)payment by the Secretary of a total of $10,000 on behalf of the borrower; (3)if the borrower ceases to fulfill the service obligation under such agreement prior to the end of the 5-year period, as soon as the borrower is determined to have ceased to fulfill such obligation in accordance with regulations of the Secretary; or (4)6 months after the end of any calendar year in which the borrower’s gross income equals or exceeds 4 times the national per capita disposable personal income (current dollars) for such calendar year, as determined on the basis of the National Income and Product Accounts Tables of the Bureau of Economic Analysis of the Department of Commerce, as determined in accordance with regulations prescribed by the Secretary. (c)

Repayment to eligible lenders

Subject to the regulations prescribed by the Secretary by regulation under subsection (a)(6), the Secretary shall pay to each eligible lender or holder for each payment period the amount of the interest that accrues on a loan of a student borrower who is selected under subsection (a). (d)

Application for repayment

(1)

In general

Each eligible individual desiring loan interest payment under this section shall submit a complete and accurate application to the Secretary at such time, in such manner, and containing such information as the Secretary may require. (2)

Failure to complete service agreement

Such application shall contain an agreement by the individual that, if the individual fails to complete the 5 consecutive years of service required by subsection (a)(2)(E), the individual agrees to repay the Secretary the amount of any interest paid by the Secretary on behalf of the individual. (e)

Treatment of consolidation loans

A consolidation loan made under section 428C of the Higher Education Act of 1965, or a Federal Direct Consolidation Loan made under part D of title IV of such Act, may be a qualified loan for the purpose of this section only to the extent that such loan amount was used by a borrower who otherwise meets the requirements of this section to repay— (1)a loan made under section 428 or 428H of such Act; or (2)a Federal Direct Stafford Loan, or a Federal Direct Unsubsidized Stafford Loan, made under part D of title IV of such Act. (f)

Prevention of double benefits

No borrower may, for the same service, receive a benefit under both this section and— (1)any loan forgiveness program under title IV of the Higher Education Act of 1965; or (2)subtitle D of title I of the National and Community Service Act of 1990 (42 U.S.C. 12571 et seq.).