[Congressional Bills 110th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2661 Introduced in House (IH)]







110th CONGRESS
  1st Session
                                H. R. 2661

To make careers in public service more feasible for students with high 
                           educational debt.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             June 11, 2007

 Mr. Sarbanes introduced the following bill; which was referred to the 
                    Committee on Education and Labor

_______________________________________________________________________

                                 A BILL


 
To make careers in public service more feasible for students with high 
                           educational debt.

    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 ``Education for Public Service Act of 
2007''.

SEC. 2. FINDINGS.

    Congress finds the following:
            (1) The Nation benefits greatly from the contributions of 
        persons who obtain higher education, including graduate and 
        professional degrees, and then devote much of their careers to 
        public service. High educational debt is an impediment that 
        discourages borrowers from pursuing low-paying public service 
        employment.
            (2) In 1993, Congress created the income-contingent loan 
        repayment option to help high-debt borrowers to have lower-
        paying public service careers.
            (3) This plan has not yet succeeded in removing the 
        barriers to public service created by high educational debt. 
        The principal problem is that borrowers who elect this option 
        do not receive debt forgiveness until they have been paying for 
        25 years. Graduates are unable to contemplate such a long 
        period of repayment before their educational debts are 
        forgiven. Many of them expect to be helping to pay for their 
        children's education within that period.
            (4) The goal of income-contingent repayment can be better 
        achieved by reducing the option's period after which loans are 
        forgiven for borrowers who have made ten years of monthly 
        repayments on their loans while serving in full time jobs in 
        governmental or non-profit agencies.
            (5) Some borrowers are discouraged from using the income-
        contingent repayment option because it includes a severe 
        ``marriage penalty.'' It attributes the incomes of both spouses 
        to each borrower spouse, so that when a borrower marries, the 
        amount of repayment due under the option is vastly increased. 
        The option can be made more equitable by attributing only half 
        of the income of a couple to each spouse.
            (6) Making adjustments to the income-contingent repayment 
        option will improve access to higher education opportunities 
        and will enable more graduates to work in public service.

SEC. 3. IMPROVEMENTS IN THE INCOME-CONTINGENT REPAYMENT OPTION.

    (a) Forgiveness for Public Service.--Section 455(e) of the Higher 
Education Act of 1965 (20 U.S.C. 1087e(e)) is amended by adding at the 
end the following:
            ``(7) Repayment plan for public sector employees.--
                    ``(A) In general.--The Secretary shall forgive the 
                balance due on any loan made under this part or section 
                428C(b)(5) for a borrower--
                            ``(i) who has made 120 payments on such 
                        loan pursuant to income contingent repayment; 
                        and
                            ``(ii) who was employed for the ten-year 
                        period during which the borrower made the 120 
                        payments described in clause (i), in a public 
                        sector job.
                    ``(B) Public sector job.--In this paragraph, the 
                term `public sector job' means a full-time job in which 
                the employer is a Federal, State, or local government 
                agency or intergovernmental authority, or an 
                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 Act.
            ``(8) Return to standard repayment.--A borrower who is 
        repaying a loan made under this part or section 428C(b)(5) may 
        choose, at any time, to terminate repayment pursuant to income 
        contingent repayment and repay such loan under the standard 
        repayment plan.''.
    (b) Treatment of Married Borrower's Income.--Section 455(e)(2) of 
the Higher Education Act of 1965 (20 U.S.C. 1087e(e)(2)) is amended by 
striking the phrase ``on the adjusted gross income of the borrower and 
the borrower's spouse'' and inserting the phrase ``on half of the total 
of the adjusted gross income of the borrower and the adjusted gross 
income of the borrower's spouse''.
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