[Congressional Bills 110th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2669 Reported in House (RH)]
Union Calendar No. 128
110th CONGRESS
1st Session
H. R. 2669
[Report No. 110-210]
To provide for reconciliation pursuant to section 601 of the concurrent
resolution on the budget for fiscal year 2008.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
June 12, 2007
Mr. George Miller of California (for himself and Mr. Hinojosa)
introduced the following bill; which was referred to the Committee on
Education and Labor
June 25, 2007
Additional sponsors: Ms. Hirono, Mr. Hare, Ms. Clarke, Ms. Woolsey,
Mrs. Davis of California, Mr. Sarbanes, Mr. Bishop of New York, Mr.
Yarmuth, Ms. Shea-Porter, Mr. Scott of Virginia, Mr. Davis of Illinois,
Mr. Tierney, Ms. Zoe Lofgren of California, Mr. Wu, Mr. Ellison, Ms.
Carson, Mr. Kildee, Mr. Engel, Mr. Van Hollen, Ms. DeLauro, Mr.
Kucinich, Ms. McCollum of Minnesota, Mr. Lewis of Georgia, Ms.
Schakowsky, Mr. Stark, Ms. Matsui, Mrs. Maloney of New York, Mr. Price
of North Carolina, Ms. Eshoo, and Ms. Kilpatrick of Michigan
June 25, 2007
Reported with an amendment, committed to the Committee of the Whole
House on the State of the Union, and ordered to be printed
[Strike out all after the enacting clause and insert the part printed
in italic]
[For text of introduced bill, see copy of bill as introduced on June
12, 2007]
_______________________________________________________________________
A BILL
To provide for reconciliation pursuant to section 601 of the concurrent
resolution on the budget for fiscal year 2008.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) Short Title.--This Act may be cited to as the ``College Cost
Reduction Act of 2007''.
(b) Table of Contents.--
Sec. 1. Short title; table of contents.
Sec. 2. References; effective date.
TITLE I--INVESTING IN STUDENT AID
Part A--Increasing the Purchasing Power of Pell Grants
Sec. 101. Mandatory Pell Grant Increases.
Sec. 102. Support for working students.
Sec. 103. Simplified needs test and automatic zero improvements.
Sec. 104. Definitions.
Part B--Making Student Loans More Affordable
Sec. 111. Interest rate reductions.
Sec. 112. Increases in loan limits.
Sec. 113. Reduction of lender special allowance payments.
Sec. 114. Elimination of exceptional performer status for lenders.
Sec. 115. Reduction of lender insurance percentage.
Sec. 116. Guaranty agency collection retention.
Sec. 117. Unit costs for account maintenance fees.
Sec. 118. Increased loan fees from lenders.
Sec. 119. Student loan information.
Sec. 120. Market-based determination of lender returns.
Part C--Rewarding Service in Repayment
Sec. 131. Loan forgiveness for service in areas of national need.
``Sec. 428K. Loan forgiveness for service in areas of national
need.
Sec. 132. Income-contingent repayment for public sector employees.
Sec. 133. Income-based repayment.
``Sec. 493C. Income-based repayment.
Sec. 134. Definition of economic hardship.
Sec. 135. Deferrals.
Sec. 136. Maximum repayment period.
Sec. 137. Deferral of loan repayment following active duty.
``Sec. 484C. Deferral of loan repayment following active duty.
Sec. 138. Sense of the Congress; report.
Part D--Sustaining the Perkins Loan Program
Sec. 141. Federal Perkins Loans.
TITLE II--REDUCING THE COST OF COLLEGE
Sec. 201. State commitment to affordable college education.
``Sec. 132. State commitment to affordable college education.
Sec. 202. Consumer information and public accountability in higher
education.
``Sec. 131. Consumer information and public accountability in
higher education.
Sec. 203. Incentives and rewards for low tuition.
``Sec. 401B. Incentives and rewards for low tuition.
Sec. 204. Cooperative education rewards for institutions that restrain
tuition increases.
``TITLE VIII--COOPERATIVE EDUCATION REWARDS FOR INSTITUTIONS THAT
RESTRAIN TUITION INCREASES
``Sec. 801. Definition of cooperative education.
``Sec. 802. Authorization of appropriations; reservations.
``Sec. 803. Grants for cooperative education.
``Sec. 804. Demonstration and innovation projects; training and
resource centers; and research.
TITLE III--ENSURING A HIGHLY QUALIFIED TEACHER IN EVERY CLASSROOM
Part A--TEACH Grants
Sec. 301. TEACH Grants.``subpart 9--teach grants
``Sec. 420L. Program established.
``Sec. 420M. Eligibility; applications.
``Sec. 420N. Definitions.
``Sec. 420O. Program period and funding.
Part B--Centers of Excellence
Sec. 311. Centers of excellence.
``Part C--Centers of Excellence
``Sec. 231. Definitions.
``Sec. 232. Centers of excellence.
``Sec. 233. Appropriations.
TITLE IV--LEVERAGING FUNDS TO INCREASE COLLEGE ACCESS
Part A--Strengthening Historically Black Colleges and Universities and
Minority-Serving Institutions
Sec. 401. Investment in Historically Black Colleges and Universities
and Minority-Serving Institution.
``Part I--Strengthening Historically Black Colleges and Universities
and Other Minority-Serving Institutions
``Sec. 499A. Investment in Historically Black Colleges and
Universities and Other Minority-Serving
Institution.
Part B--College Access Challenge Grants
Sec. 411. College Access Challenge grants.
Part C--Upward Bound
Sec. 412. Upward Bound.
TITLE V--ADDITIONAL PROVISIONS
Sec. 501. Independent evaluation of distance education programs.
Sec. 502. Encouraging colleges and universities to ``go green''.
SEC. 2. REFERENCES; EFFECTIVE DATE.
(a) 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.).
(b) Effective Date.--Except as otherwise expressly provided
therein, the amendments made by this Act shall be effective on October
1, 2007.
TITLE I--INVESTING IN STUDENT AID
PART A--INCREASING THE PURCHASING POWER OF PELL GRANTS
SEC. 101. MANDATORY PELL GRANT INCREASES.
(a) Extension of Authority.--Section 401(a) (20 U.S.C. 1070a(a)) is
amended by striking ``fiscal year 2004'' and inserting ``fiscal year
2013''.
(b) Funding for Increases.--Section 401(b) (20 U.S.C. 1070a(b)) is
amended by adding at the end the following new paragraph:
``(9) Additional funds.--
``(A) In general.--There are authorized to be
appropriated, and there are appropriated, to carry out
subparagraph (B) of this paragraph (in addition to any
other amounts appropriated to carry out this section
and out of any money in the Treasury not otherwise
appropriated) the following amounts:
``(i) $840,000,000 for fiscal year 2008;
``(ii) $870,000,000 for fiscal year 2009;
``(iii) $1,340,000,000 for fiscal year
2010;
``(iv) $2,280,000,000 for fiscal year 2011;
``(v) $2,350,000,000 for fiscal year 2012;
``(vi) $2,400,000,000 for fiscal year 2013;
``(vii) $2,450,000,000 for fiscal year
2014;
``(viii) $2,510,000,000 for fiscal year
2015;
``(ix) $2,550,000,000 for fiscal year 2016;
and
``(x) $2,570,000,000 for fiscal year 2017.
``(B) Increase in federal pell grants.--The amounts
made available pursuant to subparagraph (A) of this
paragraph shall be used to increase the amount of the
maximum Pell Grant for which a student shall be
eligible during an award year, as specified in the last
enacted appropriation Act applicable to that award
year, by--
``(i) $200 for each of the award years
2008-2009 and 2009-2010;
``(ii) $300 for award year 2010-2011; and
``(iii) $500 for award year 2011-2012 and
each subsequent award year.
``(C) Use of fiscal year funds for award years.--
The amounts made available by subparagraph (A) for any
fiscal year shall be available and remain available for
use under subparagraph (B) for the award year that
begins in such fiscal year.''.
(c) Authorized Maximums.--Section 401(b)(2)(A) (20 U.S.C.
1070a(b)(2)(A)) is amended to read as follows:
``(2)(A) The amount of the Federal Pell Grant for a student
eligible under this part shall be--
``(i) $7,600 for academic year 2008-2009;
``(ii) $8,600 for academic year 2009-2010;
``(iii) $9,600 for academic year 2010-2011;
``(iv) $10,600 for academic year 2011-2012; and
``(v) $11,600 for academic year 2012-2013,
less an amount equal to the amount determined to be the
expected family contribution with respect to that student for
that year.''.
(d) Tuition Sensitivity.--
(1) Amendment.--Section 401(b) (20 U.S.C. 1070a(b)) is
further amended--
(A) by striking paragraph (3); and
(B) by redesignating paragraphs (4) through (9) as
paragraphs (3) through (8), respectively.
(2) Effective date.--The amendments made by paragraph (1)
of this subsection are effective on the date of enactment of
this Act.
(e) Multiple Grants.--
(1) Amendment.--Paragraph (5) of section 401(b) (as
redesignated by subsection (d)(1)(B)) is amended to read as
follows:
``(5) Year-round pell grants.--The Secretary is authorized,
for students enrolled in a baccalaureate degree, associate's
degree, or certificate program of study at an eligible
institution, to award such students not more than two Pell
grants during an award year to permit such students to
accelerate progress toward their degree or certificate
objectives by enrolling in courses for more than 2 semesters,
or 3 quarters, or the equivalent, in a given academic year.''.
(2) Effective date.--The amendment made by paragraph (1)
shall be effective July 1, 2009.
(f) Academic Competitiveness Grants.--Section 401A (as amended by
section 8003 of Public Law 109-171) is amended--
(1) in subsection (c)(3)(A)(ii), by inserting ``, except as
part of a secondary school program of study'' before the
semicolon;
(2) by redesignating subsection (g) as subsection (h); and
(3) by inserting after subsection (f) the following new
subsection:
``(g) Determination of Academic Year.--Notwithstanding section
481(a)(2), for the purpose of determining eligibility for a grant under
this section, a student shall be considered to be enrolled or accepted
for enrollment in the first, second, third, or fourth academic year of
a program of undergraduate education based on the student's class
standing, as determined by the institution of higher education at which
the student is enrolled or accepted for enrollment.''.
(g) Eligibility for Academic Competitiveness Grants.--Section 401A
is further amended--
(1) in subsection (c)--
(A) by striking ``full-time''; and
(B) by amending paragraph (1) to read as follows:
``(1) is an eligible student under section 484, including
being enrolled or accepted for enrollment in a degree,
certificate, or other eligible program leading to a recognized
educational credential at an institution of higher
education;''; and
(2) in subsection (d), by adding at the end the following
new paragraph:
``(3) Adjustment for less than full-time enrollment.--A
grant awarded under this section to an eligible student who
attends an eligible institution on a less than full-time (but
at least half-time or more) basis shall be reduced in the same
proportion as would a Federal Pell Grant pursuant to section
401(b)(2)(B).''.
SEC. 102. SUPPORT FOR WORKING STUDENTS.
(a) Dependent Students.--Subparagraph (D) of section 475(g)(2) (20
U.S.C. 1087oo)(g)(2)(D)) is amended to read as follows:
``(D) an income protection allowance of the
following amount (or a successor amount prescribed by
the Secretary under section 478)--
``(i) for the 2009-2010 academic year,
$3,750;
``(ii) for the 2010-2011 academic year,
$4,500;
``(iii) for the 2011-2012 academic year,
$5,250; and
``(iv) for the 2012-2013 academic year,
$6,000;''.
(b) Independent Students Without Dependents Other Than a Spouse.--
Clause (iv) of section 476(b)(1)(A) (20 U.S.C. 1087pp(b)(1)(A)(iv)) is
amended to read as follows:
``(iv) an income protection allowance of
the following amount (or a successor amount
prescribed by the Secretary under section
478)--
``(I) for single or separated
students, or married students where
both are enrolled pursuant to
subsection (a)(2)--
``(aa) for the 2009-2010
academic year, $6,690;
``(bb) for the 2010-2011
academic year, $7,160;
``(cc) for the 2011-2012
academic year, $7,630; and
``(dd) for the 2012-2013
academic year, $8,090; and
``(II) for married students where 1
is enrolled pursuant to subsection
(a)(2)--
``(aa) for the 2009-2010
academic year, $10,720;
``(bb) for the 2010-2011
academic year, $11,470;
``(cc) for the 2011-2012
academic year, $12,220; and
``(dd) for the 2012-2013
academic year, $12,960;''.
(c) Updated Tables and Amounts.--Section 478(b) (20 U.S.C.
1087rr(b)) is amended--
(1) in paragraph (1)--
(A) by striking ``Revised tables.--For each'' and
inserting ``Revised tables.--
``(A) In general.--For each'';
(B) in subparagraph (A) (as designated by
subparagraph (A)), in the third sentence--
(i) by striking ``preceding sentence'' and
inserting ``subparagraph (A)''; and
(ii) by striking ``For the 2007-2008'' and
inserting the following:
``(B) Special rule for 2007-2008 academic year.--
For the 2007-2008''; and
(C) by adding at the end the following:
``(C) Special rule for 2009-2010 through 2012-2013
academic years.--For the 2009-2010 academic year, and
for each of the 3 succeeding academic years, the
Secretary shall revise the tables in accordance with
this paragraph, except that, for the table in section
477(b)(4), the Secretary shall revise such table by
increasing the amounts contained in such table for the
preceding academic year by 10 percent.''; and
(2) in paragraph (2), by striking ``shall be developed''
and all that follows through the period at the end and
inserting ``shall be developed--
``(A) for academic year 2008-2009, by increasing
each of the dollar amounts contained in such section as
such section was in effect on the day before the date
of enactment of the College Cost Reduction Act of 2007
by a percentage equal to the estimated percentage
increase in the Consumer Price Index (as defined in
section 478(f)) between December 2006 and the December
next preceding the beginning of such academic year, and
rounding the result to the nearest $10; and
``(B) for each academic year after 2012-2013, by
increasing each of the dollar amounts contained in such
section for academic year 2012-2013 by a percentage
equal to the estimated percentage increase in the
Consumer Price Index (as defined in section 478(f))
between December 2011 and the December next preceding
the beginning of such academic year, and rounding the
result to the nearest $10.''.
(d) Effective Date.--The amendments made by subsections (a) and (b)
shall take effect on October 1, 2008, and the amendment made by
subsection (c) shall take effect on July 1, 2008.
SEC. 103. SIMPLIFIED NEEDS TEST AND AUTOMATIC ZERO IMPROVEMENTS.
(a) Simplified Needs Test.--Section 479 (20 U.S.C. 1087ss) is
amended--
(1) in subsection (b)--
(A) in paragraph (1)(A)(i)--
(i) in subclause (II), by striking ``or''
after the semicolon;
(ii) by redesignating subclause (III) as
subclause (IV);
(iii) by inserting after subclause (II) the
following:
``(III) 1 of whom is a dislocated
worker; or''; and
(iv) in subclause (IV) (as redesignated by
clause (ii)), by striking ``12-month'' and
inserting ``24-month''; and
(B) in paragraph (1)(B)(i)--
(i) in subclause (II), by striking ``or''
after the semicolon;
(ii) by redesignating subclause (III) as
subclause (IV);
(iii) by inserting after subclause (II) the
following:
``(III) 1 of whom is a dislocated
worker; or''; and
(iv) in subclause (IV) (as redesignated by
clause (ii)), by striking ``12-month'' and
inserting ``24-month'';
(2) in subsection (c)--
(A) in paragraph (1)--
(i) in subparagraph (A)--
(I) in clause (ii), by striking
``or'' after the semicolon;
(II) by redesignating clause (iii)
as clause (iv);
(III) by inserting after clause
(ii) the following:
``(iii) 1 of whom is a dislocated worker;
or''; and
(IV) in clause (iv) (as
redesignated by subclause (II)), by
striking ``12-month'' and inserting
``24-month''; and
(ii) in subparagraph (B), by striking
``$20,000'' and inserting ``$30,000''; and
(B) in paragraph (2)--
(i) in subparagraph (A)--
(I) in clause (ii), by striking
``or'' after the semicolon;
(II) by redesignating clause (iii)
as clause (iv);
(III) by inserting after clause
(ii) the following:
``(iii) is a dislocated worker; or''; and
(IV) in clause (iv) (as
redesignated by subclause (II)), by
striking ``12-month'' and inserting
``24-month''; and
(ii) in subparagraph (B), by striking
``$20,000'' and inserting ``$30,000''; and
(C) in the flush matter following paragraph (2)(B),
by adding at the end the following: ``The Secretary
shall annually adjust the income level necessary to
qualify an applicant for the zero expected family
contribution. The income level shall be adjusted
according to increases in the Consumer Price Index, as
defined in section 478(f).''; and
(3) in subsection (d)--
(A) by redesignating paragraphs (1) through (6) as
subparagraphs (A) through (F), respectively and moving
the margins of such subparagraphs 2 ems to the right;
(B) by striking ``(d) Definition'' and all that
follows through ``the term'' and inserting the
following:
``(d) Definitions.--In this section:
``(1) Dislocated worker.--The term `dislocated worker' has
the meaning given the term in section 101 of the Workforce
Investment Act of 1998 (29 U.S.C. 2801).
``(2) Means-tested federal benefit program.--The term''.
(b) Discretion of Student Financial Aid Administrators.--Section
479A(a) (20 U.S.C. 1087tt(a)) is amended in the third sentence by
inserting ``a family member who is a dislocated worker (as defined in
section 101 of the Workforce Investment Act of 1998 (29 U.S.C.
2801)),'' after ``recent unemployment of a family member,''.
(c) Effective Date.--The amendments made by this section shall be
effective on July 1, 2009.
SEC. 104. DEFINITIONS.
(a) Total Income.--Section 480(a)(2) (20 U.S.C. 1087vv(a)(2)) is
amended--
(1) by striking ``and no portion'' and inserting ``no
portion''; and
(2) by inserting ``and no distribution from any qualified
education benefit described in subsection (f)(3) that is not
subject to Federal income tax,'' after ``1986,''.
(b) Untaxed Income and Benefits.--Section 480(b) (20 U.S.C.
1087vv(b)) is amended to read as follows:
``(b) Untaxed Income and Benefits.--
``(1) The term `untaxed income and benefits' means--
``(A) child support received;
``(B) workman's compensation;
``(C) veteran's benefits such as death pension,
dependency, and indemnity compensation, but excluding
veterans' education benefits as defined in subsection
(c);
``(D) interest on tax-free bonds;
``(E) housing, food, and other allowances
(excluding rent subsidies for low-income housing) for
military, clergy, and others (including cash payments
and cash value of benefits);
``(F) cash support or any money paid on the
student`s behalf, except, for dependent students, funds
provided by the student's parents;
``(G) untaxed portion of pensions;
``(H) payments to individual retirement accounts
and Keogh accounts excluded from income for Federal
income tax purposes; and
``(I) any other untaxed income and benefits, such
as Black Lung Benefits, Refugee Assistance, railroad
retirement benefits, or Job Training Partnership Act
noneducational benefits or benefits received through
participation in employment and training activities
under title I of the Workforce Investment Act of 1998
(29 U.S.C. 2801 et seq.).
``(2) The term `untaxed income and benefits' shall not
include the amount of additional child tax credit claimed for
Federal income tax purposes.''.
(c) Assets.--Section 480(f) (20 U.S.C. 1087vv(f)) is amended--
(1) in paragraph (3), by striking ``shall not be considered
an asset of a student for purposes of section 475'' and
inserting ``shall be considered an asset of the parent for
purposes of section 475'';
(2) by redesignating paragraphs (4) and (5) as paragraphs
(5) and (6), respectively; and
(3) by inserting after paragraph (3) the following:
``(4) A qualified education benefit shall be considered an
asset of the student for purposes of section 476 and 477.''.
(d) Other Financial Assistance.--Section 480(j)(2) (20 U.S.C.
1087vv(j)(2)) is amended by inserting ``, or a distribution that is not
includable in gross income under section 529 of such Code, under
another prepaid tuition plan offered by a State, or under a Coverdell
education savings account under section 530 of such Code,'' after
``1986''.
(e) Effective Date.--The amendments made by this section shall be
effective on July 1, 2009.
PART B--MAKING STUDENT LOANS MORE AFFORDABLE
SEC. 111. INTEREST RATE REDUCTIONS.
(a) FFEL Interest Rates.--
(1) Section 427A(l) (20 U.S.C. 1077a(l)) is amended by
adding at the end the following new paragraph:
``(4) Reduced rates for undergraduate subsidized loans.--
Notwithstanding subsection (h) and paragraph (1) of this
subsection, with respect to any loan to an undergraduate
student made, insured, or guaranteed under this part (other
than a loan made pursuant to section 428B, 428C, or 428H) for
which the first disbursement is made on or after July 1, 2006,
and before July 1, 2013, the applicable rate of interest shall
be as follows:
``(A) For a loan for which the first disbursement
is made on or after July 1, 2006, and before July 1,
2008, 6.80 percent on the unpaid principal balance of
the loan.
``(B) For a loan for which the first disbursement
is made on or after July 1, 2008, and before July 1,
2009, 6.12 percent on the unpaid principal balance of
the loan.
``(C) For a loan for which the first disbursement
is made on or after July 1, 2009, and before July 1,
2010, 5.44 percent on the unpaid principal balance of
the loan.
``(D) For a loan for which the first disbursement
is made on or after July 1, 2010, and before July 1,
2011, 4.76 percent on the unpaid principal balance of
the loan.
``(E) For a loan for which the first disbursement
is made on or after July 1, 2011, and before July 1,
2012, 4.08 percent on the unpaid principal balance of
the loan.
``(F) For a loan for which the first disbursement
is made on or after July 1, 2012 and before July 1,
2013, 3.40 percent on the unpaid principal balance of
the loan.''.
(2) Special allowance cross reference.--Section
438(b)(2)(I)(ii)(II) (20 U.S.C. 1086(b)(2)(I)(ii)(II)) is
amended by striking ``section 427A(l)(1)'' and inserting
``section 427A(l)(1) or (l)(4)''.
(b) Direct Loan Interest Rates.--Section 455(b)(7) (20 U.S.C.
1087e(b)(7)) is amended by adding at the end the following new
subparagraph:
``(D) Reduced rates for undergraduate fdsl.--
Notwithstanding the preceding paragraphs of this
subsection, for Federal Direct Stafford Loans made to
undergraduate students for which the first disbursement
is made on or after July 1, 2006, and before July 1,
2013, the applicable rate of interest shall be as
follows:
``(i) For a loan for which the first
disbursement is made on or after July 1, 2006,
and before July 1, 2008, 6.80 percent on the
unpaid principal balance of the loan.
``(ii) For a loan for which the first
disbursement is made on or after July 1, 2008,
and before July 1, 2009, 6.12 percent on the
unpaid principal balance of the loan.
``(iii) For a loan for which the first
disbursement is made on or after July 1, 2009,
and before July 1, 2010, 5.44 percent on the
unpaid principal balance of the loan.
``(iv) For a loan for which the first
disbursement is made on or after July 1, 2010,
and before July 1, 2011, 4.76 percent on the
unpaid principal balance of the loan.
``(v) For a loan for which the first
disbursement is made on or after July 1, 2011,
and before July 1, 2012, 4.08 percent on the
unpaid principal balance of the loan.
``(vi) For a loan for which the first
disbursement is made on or after July 1, 2012,
and before July 1, 2013, 3.40 percent on the
unpaid principal balance of the loan.''.
SEC. 112. INCREASES IN LOAN LIMITS.
(a) Increase in Third and Subsequent Year Limits.--
(1) Federal insurance limits.--Section 425(a)(1)(A)(iii)
(20 U.S.C. 1075(a)(1)(A)(iii)) is amended by striking
``$5,500'' and inserting ``$7,500''.
(2) Guaranty limits.--Section 428(b)(1)(A)(iii)(I) (20
U.S.C. 1078(b)(1)(A)(iii)(I)) is amended by striking ``$5,500''
and inserting ``$7,500''.
(b) Increase in Aggregate Limits.--
(1) Federal insurance limits.--Section 425(a)(2)(A) (20
U.S.C. 1075(a)(2)(A)(i)) is amended--
(A) in clause (i), by striking ``$23,000'' and
inserting ``$30,500''; and
(B) in clause (ii), by striking ``$65,500'' and
inserting ``$73,000''.
(2) Guaranty limits.--Section 428(b)(1)(B) (20 U.S.C.
1078(b)(1)(A)(iii)(I)) is amended--
(A) in clause (i), by striking ``$23,000'' and
inserting ``$30,500''; and
(B) in clause (ii), by striking ``$65,500'' and
inserting ``$73,000''.
(c) Effective Date.--The amendments made by this section shall be
effective July 1, 2008.
SEC. 113. REDUCTION OF LENDER SPECIAL ALLOWANCE PAYMENTS.
Section 438(b)(2)(I) (20 U.S.C. 1087-1(b)(2)(I)) is amended--
(1) in clause (i), by striking ``clauses (ii), (iii), and
(iv)'' and inserting ``the following clauses'';
(2) in clause (v)(III), by striking ``clauses (ii), (iii),
and (iv)'' and inserting ``clauses (ii), (iii), (iv), and
(vi)''; and
(3) by adding at the end the following new clause:
``(vi) Reduction for loans on or after
october 1, 2007.--With respect to a loan on
which the applicable interest rate is
determined under section 427A(l), the
percentage to be added under clause (i)(III) in
computing the special allowance payment
pursuant to this subparagraph shall be the
following:
``(I) In general and plus loans.--
1.79 percent in the case of a loan
described in clause (i) or (iii) for
which the first disbursement of
principal is made on or after October
1, 2007.
``(II) In school and grace
period.--1.19 percent in the case of a
loan described in clause (ii)(II) for
which the first disbursement of
principal is made on or after October
1, 2007.
``(III) Consolidation loans.--2.09
percent in the case of a loan described
in clause (iv) for which the first
disbursement of principal is made on or
after October 1, 2007.''.
SEC. 114. ELIMINATION OF EXCEPTIONAL PERFORMER STATUS FOR LENDERS.
(a) Elimination of Status.--Part B of title IV (20 U.S.C. 1071 et
seq.) is amended by striking section 428I (20 U.S.C. 1078-9).
(b) Conforming Amendments.--Part B of title IV is further amended--
(1) in section 428(c)(1) (20 U.S.C. 1078(c)(1))--
(A) by striking subparagraph (D); and
(B) by redesignating subparagraphs (E) through (H)
as subparagraphs (D) through (G), respectively; and
(2) in section 438(b)(5) (20 U.S.C. 1087-1(b)(5)), by
striking the matter following subparagraph (B).
SEC. 115. REDUCTION OF LENDER INSURANCE PERCENTAGE.
(a) Amendment.--Subparagraph (G) of section 428(b)(1) (20 U.S.C.
1078(b)(1)(G)) is amended to read as follows:
``(G) insures 95 percent of the unpaid principal of
loans insured under the program, except that--
``(i) such program shall insure 100 percent
of the unpaid principal of loans made with
funds advanced pursuant to section 428(j) or
439(q); and
``(ii) notwithstanding the preceding
provisions of this subparagraph, such program
shall insure 100 percent of the unpaid
principal amount of exempt claims as defined in
subsection (c)(1)(G);''.
(b) Effective Date.--The amendment made by subsection (a) shall
take effect with respect to loans made on or after October 1, 2007.
SEC. 116. GUARANTY AGENCY COLLECTION RETENTION.
Clause (ii) of section 428(c)(6)(A) (20 U.S.C. 1078(c)(6)(A)(ii))
is amended to read as follows:
``(ii) an amount equal to 23 percent of
such payments for use in accordance with
section 422B, except that beginning October 1,
2007, this subparagraph shall be applied by
substituting `16 percent' for `23 percent'.''.
SEC. 117. UNIT COSTS FOR ACCOUNT MAINTENANCE FEES.
Section 458(b) (20 U.S.C. 1087h(b)) is amended--
(1) by striking ``Account'' and inserting the following:
``(1) For fiscal years 2006 and 2007.--For fiscal years
2006 and 2007, account''; and
(2) by adding at the end the following new paragraph:
``(2) For fiscal year 2008 and succeeding fiscal years.--
``(A) Unit cost basis.--For fiscal year 2008 and
each succeeding fiscal year, the Secretary shall
calculate the account maintenance fees payable to
guaranty agencies under subsection (a)(3), on a per-
loan cost basis in accordance with subparagraph (B) of
this paragraph.
``(B) Determinations.--To determine the amount that
shall be paid under subsection (a)(3) per outstanding
loan guaranteed by a guaranty agency for fiscal year
2008 and succeeding fiscal years, the Secretary shall--
``(i) establish the per-loan cost basis
amount by--
``(I) dividing the total amount of
account maintenance fees paid under
subsection (a)(3) in fiscal year 2006,
by
``(II) the number of loans under
part B that were outstanding in that
fiscal year; and
``(ii) determine on October 1 of fiscal
year 2008 and each subsequent fiscal year, and
pay to each guaranty agency, an amount equal to
the product of the number of loans under part B
that are outstanding on October 1 of that
fiscal year and insured by that guaranty
agency, multiplied by--
``(I) the amount determined under
clause (i); increased by
``(II) a percentage equal to the
percentage increase in the GDP price
index (as determined by the Bureau of
Labor Statistics of the Department of
Labor) between the calendar quarter
ending on June 30, 2006, and the
calendar quarter ending on the June 30
preceding such October 1 of such fiscal
year.''.
SEC. 118. INCREASED LOAN FEES FROM LENDERS.
Paragraph (2) of section 438(d) (20 U.S.C. 1087-1(d)(2)) is amended
to read as follows:
``(2) Amount of loan fees.--
``(A) Amount.--The amount of the loan fee which
shall be deducted under paragraph (1), but which may
not be collected from the borrower, shall be equal to--
``(i) except as provided in clauses (ii)
and (iii), 0.50 percent of the principal amount
of the loan with respect to any loan under this
part for which the first disbursement was made
on or after October 1, 1993;
``(ii) 1.0 percent of the principal amount
of the loan with respect to any loan under this
part for which the first disbursement was made
on or after October 1, 2007, that is held by
any holder other than a holder described in
subclause (I) or (II) of clause (iii); and
``(iii) 0.0 percent of the principal amount
of the loan with respect to any loan under this
part for which the first disbursement was made
on or after October 1, 2007, that is held by--
``(I) any holder that, together
with its affiliated holders, is
designated by the Secretary as a small
lender under subparagraph (B); or
``(II) any holder that--
``(aa) is a unit of State
or local government or a
nonprofit private entity; and
``(bb) is not owned in
whole or in part by, or
controlled or operated by, or
otherwise affiliated with, a
for-profit entity.
``(B) Designation of small lenders.--In determining
which holders of eligible loans qualify as small
lenders for purposes of subparagraph (A)(iii)(I), the
Secretary shall, using the most recently available data
with respect to the total principal amount of eligible
loans held by holders--
``(i) rank all holders of eligible loans
(combined with their affiliated holders) in
descending order by total principal amount of
eligible loans held;
``(ii) calculate the total principal amount
of eligible loans held by all holders; and
``(iii) identify the subset of
consecutively ranked holders under clause (i),
starting with the lowest ranked holder, that
together hold a total principal amount of such
loans equal to 15 percent of the total amount
calculated under clause (ii), but excluding the
holder, if any, whose holdings when added cause
the total holdings of the subset to equal but
not exceed such 15 percent of such total amount
calculated; and
``(iv) designate as small lenders any
holder identified as a member of the subset
under clause (iii).''.
SEC. 119. STUDENT LOAN INFORMATION.
Section 428(k) (20 U.S.C. 1078(k)) is amended by adding at the end
the following new paragraph:
``(4) Student loan information.--
``(A) Notwithstanding any other provision of law or
regulation, a lender, secondary market, holder, or
guaranty agency shall provide, free of charge and in a
timely and effective manner, any student loan
information maintained by that entity that is requested
by an institution of higher education or any third-
party servicer (as defined in section 481(c)) working
on behalf of that institution to prevent student loan
defaults.
``(B) An institution and any third-party servicer
obtaining access to information under subparagraph (A)
shall safeguard that information in order to prevent
potential abuses of that information, including
identity theft.
``(C) Any third party servicer that obtains
information under this paragraph--
``(i) shall only use the information in a
manner directly related to the default
prevention work the servicer is performing on
behalf of the institution of higher education;
and
``(ii) shall be subject to any regulations
established by the Secretary pursuant to
section 432 concerning the misuse of such
information, including any penalties for such
misuse.''.
SEC. 120. MARKET-BASED DETERMINATION OF LENDER RETURNS.
(a) Joint Planning Study To Select Auction Mechanisms for
Testing.--
(1) Planning study.--The Secretaries of Education and
Treasury jointly shall conduct a planning study, in
consultation with the Office of Management and Budget, the
Congressional Budget Office, the General Accounting Office, and
other individuals and entities the Secretaries determines
appropriate, to--
(A) examine the matters described in paragraph (2)
in order to determine which market-based mechanisms for
determining lender returns on loans made, insured, or
guaranteed under part B of title IV of the Higher
Education Act of 1965 (20 U.S.C. 1071 et seq.) shall be
tested under the pilot programs described in subsection
(c); and
(B) determine what related administrative and other
changes will be required in order to ensure that high-
quality services are provided under a successful
implementation of market-based determinations of lender
returns for all loans made, insured, or guaranteed
under such part.
(2) Matters examined.--The planning study under this
subsection shall examine--
(A) whether it is most appropriate to auction
existing loans under part B of title IV of such Act, to
auction the rights to originate loans under such part,
or whether the sale of securities backed by federally-
owned student loan assets originated by banks acting as
agents of the Federal Government would provide the most
efficient market-based alternative;
(B) matters related to efficient financial
organization of any auctions or sales of loans under
such part, including how loans and origination rights
are bundled, the capital structure of any
securitization plan, and issues related to servicing;
and
(C) how to ensure that statutory, regulatory, and
administrative requirements do not impede separate
management and ownership of loans or assets backed by
loans under part B of title IV of such Act.
(3) Mechanisms.--In determining which market-based
mechanisms are the most promising models to test the pilot
programs under subsection (b), the planning study shall take
into account whether a particular market-based mechanism will--
(A) ensure loan availability under part B of title
IV of such Act to all eligible students at all
participating institutions;
(B) minimize administrative complexity for
borrowers, institutions, lenders, and the Federal
Government; and
(C) reduce Federal costs if used on a program-wide
basis.
(4) Report.--A report on the results of the planning study,
together with a plan for implementation of one or more pilot
programs using promising market-based approaches for
determining lender returns, shall be transmitted to Congress
not later than 6 months after the date of enactment of this
Act.
(b) Pilot Programs To Be Tested.--
(1) Authorization.--
(A) In general.--Notwithstanding any other
provision of law, after the report described in
subsection (a)(4) is transmitted to Congress, the
Secretary of Education shall, in consultation with the
Secretary of the Treasury, begin preparations necessary
to carry out pilot programs meeting the requirements of
this subsection in accordance with the implementation
plan included in such report.
(B) Implementation date.--The Secretary of
Education shall commence implementation of the pilot
programs under this subsection not earlier than July 1,
2008.
(C) Duration and loan volume.--The pilot programs
under this subsection shall be not more than two
academic years in duration, and the Secretary of
Education may use the pilot programs to determining the
lender returns for not more than--
(i) 10 percent of the annual loan volume
under part B of title IV of the Higher
Education Act of 1965 during the first year of
the pilot programs under this subsection; and
(ii) 20 percent of the annual loan volume
under part B of title IV of such Act during the
second year of the pilot programs under this
subsection.
(2) Voluntary participation.--
(A) Participation in any auction-based pilot
program under this subsection shall be voluntary for
eligible institutions and eligible lenders
participating under part B of title IV of such Act
prior to July 1, 2006.
(B) All savings to the United States Treasury
generated by such auctions shall be distributed to
institutions participating under this subsection on a
basis proportionate to loan volume under such part for
supplemental, need-based financial aid, except that an
institution that is operating as an eligible lender
under section 435(d)(2) of such Act shall not be
eligible for any such distribution.
(3) Independent evaluation.--The Government Accountability
Office shall conduct an independent evaluation of the pilot
programs under this subsection, which evaluation shall be
completed, and the results of such submitted to the Secretary
of Education, the Secretary of the Treasury, and Congress, not
later than 120 days after the termination of such pilot
programs.
(c) Program-Wide Implementation.--Notwithstanding any other
provision of part B of title IV of the Higher Education Act of 1965,
for the first academic year beginning not less than 120 days after the
independent evaluation described in subsection (b)(3) has been
transmitted to Congress, and succeeding academic years, the Secretary
of Education is authorized to implement for all loans made under such
part, a program-wide, market-based system to determine returns to all
lenders as the Secretary of Education determines appropriate, provided
that--
(1) the Secretary of Education, in consultation with the
Secretary of the Treasury, has certified that the auction-based
system that the Secretary of Education intends to implement on
a program-wide basis would--
(A) ensure loan availability under such part to all
eligible students at all participating institutions;
(B) minimize administrative complexity for
borrowers, institutions, lenders, and the Federal
Government, including the enhancement of the
modernization of the student financial aid system; and
(C) reduce Federal costs when used on a program-
wide basis; and
(2) the Secretary of Education has notified Congress of the
Secretary's intent to implement a program-wide auction based
system, and has provided a description of the structure of such
auction-based system, at least 120 days before implementing
such system.
(d) Consultation.--
(1) In general.--As part of the planning study, pilot
programs, and program-wide implementation phases described in
this section, the Secretary of Education shall consult with
representatives of investment banks, ratings agencies, lenders,
institutions of higher education, and students, as well as
individuals or other entities with pertinent technical
expertise. The Secretary of Education shall engage in such
consultations using such methods as, and to the extent that,
the Secretary determines appropriate to the time constraints
associated with the study, programs, and implementation.
(2) Services of other federal agencies.--In carrying out
the planning study and pilot programs described in this
section, the Secretary of Education may use, on a reimbursable
basis, the services (including procurement authorities and
services), equipment, personnel, and facilities of other
agencies and instrumentalities of the Federal Government.
PART C--REWARDING SERVICE IN REPAYMENT
SEC. 131. LOAN FORGIVENESS FOR SERVICE IN AREAS OF NATIONAL NEED.
Section 428K (20 U.S.C. 1078-11) is amended to read as follows:
``SEC. 428K. LOAN FORGIVENESS FOR SERVICE IN AREAS OF NATIONAL NEED.
``(a) Program Authorized.--
``(1) Loan forgiveness authorized.--The Secretary shall
forgive, in accordance with this section, the student loan
obligation of a borrower in the amount specified in subsection
(c), for any new borrower after the date of enactment of the
College Cost Reduction Act of 2007, who--
``(A) is employed full-time in an area of national
need described in subsection (b); and
``(B) is not in default on a loan for which the
borrower seeks forgiveness.
``(2) Method of loan forgiveness.--To provide loan
forgiveness under paragraph (1), the Secretary is authorized to
carry out a program--
``(A) through the holder of the loan, to assume the
obligation to repay a qualified loan amount for a loan
made, insured, or guaranteed under this part; and
``(B) to cancel a qualified loan amount for a loan
made under part D of this title.
``(3) Regulations.--The Secretary is authorized to issue
such regulations as may be necessary to carry out the
provisions of this section.
``(b) Areas of National Need.--For purposes of this section, an
individual shall be treated as employed in an area of national need if
the individual is employed full-time as any of the following:
``(1) Early childhood educators.--An individual who is
employed as an early childhood educator in an eligible
preschool program or eligible early childhood education program
in a low-income community, and who is involved directly in the
care, development, and education of infants, toddlers, or young
children age 5 and under.
``(2) Nurses.--An individual who is employed--
``(A) as a nurse in a clinical setting; or
``(B) as a member of the nursing faculty at an
accredited school of nursing (as those terms are
defined in section 801 of the Public Health Service Act
(42 U.S.C. 296)).
``(3) Foreign language specialists.--An individual who has
obtained a baccalaureate degree in a critical foreign language
and is employed--
``(A) in an elementary or secondary school as a
teacher of a critical foreign language; or
``(B) in an agency of the United States Government
in a position that regularly requires the use of such
critical foreign language.
``(4) Librarians.--An individual who is employed as a
librarian in--
``(A) a public library that serves a geographic
area within which the public schools have a combined
average of 30 percent or more of their total student
enrollments composed of children counted under section
1113(a)(5) of the Elementary and Secondary Education
Act of 1965; or
``(B) an elementary or secondary school which is in
the school district of a local educational agency which
is eligible in such year for assistance pursuant to
title I of the Elementary and Secondary Education Act
of 1965, and which for the purpose of this paragraph
and for that year has been determined by the Secretary
(pursuant to regulations and after consultation with
the State educational agency of the State in which the
school is located) to be a school in which the
enrollment of children counted under section 1113(a)(5)
of the Elementary and Secondary Education Act of 1965
exceeds 30 percent of the total enrollment of that
school.
``(5) Highly qualified teachers: bilingual education and
low-income communities.--An individual who--
``(A) is highly qualified as such term is defined
in section 9101 of the Elementary and Secondary
Education Act of 1965; and
``(B)(i) is employed as a full-time teacher of
bilingual education; or
``(ii) is employed as a teacher in a public or
nonprofit private elementary or secondary school which
is in the school district of a local educational agency
which is eligible in such year for assistance pursuant
to title I of the Elementary and Secondary Education
Act of 1965, and which for the purpose of this
paragraph and for that year has been determined by the
Secretary (pursuant to regulations and after
consultation with the State educational agency of the
State in which the school is located) to be a school in
which the enrollment of children counted under section
1113(a)(5) of the Elementary and Secondary Education
Act of 1965 exceeds 40 percent of the total enrollment
of that school.
``(6) Child welfare workers.--An individual who--
``(A) has obtained a degree in social work or a
related field with a focus on serving children and
families; and
``(B) is employed in public or private child
welfare services.
``(7) Speech-language pathologists.--An individual who is a
speech-language pathologist, who is employed in an eligible
preschool program or an elementary or secondary school, and who
has, at a minimum, a graduate degree in speech-language
pathology, or communication sciences and disorders.
``(8) National service.--An individual who is engaged as a
participant in a project under the National and Community
Service Act of 1990 (as such terms are defined in section 101
of such Act (42 U.S.C. 12511)).
``(9) Public sector employees.--An individual who is
employed in public safety (including as a first responder,
firefighter, police officer, or other law enforcement or public
safety officer), emergency management (including as an
emergency medical technician), public health, or public
interest legal services (including prosecution or public
defense).
``(c) Qualified Loan Amount.--At the end of each school, academic,
or calendar year of full-time employment in an area of national need
described in subsection (b), not to exceed 5 years, the Secretary shall
forgive not more than $1,000 of the student loan obligation of a
borrower that is outstanding after the completion of each such school,
academic, or calendar year of employment, as appropriate, not to exceed
$5,000 in the aggregate for any borrower.
``(d) Construction.--Nothing in this section shall be construed to
authorize the refunding of any repayment of a loan.
``(e) Segal Americorps Education Award and National Service Award
Recipients.--A student borrower who qualifies for the maximum education
award under subtitle D of title I of the National and Community Service
Act of 1990 (42 U.S.C. 12601 et seq.) shall receive under this section
the amount, if any, by which the maximum benefit available under this
section exceeds the maximum education award available under such
subtitle.
``(f) Ineligibility for Double Benefits.--No borrower may receive a
reduction of loan obligations under both this section and section 428J
or 460.
``(g) Definitions.--In this section:
``(1) Critical foreign language.--The term `critical
foreign language' includes the languages of Arabic, Korean,
Japanese, Chinese, Pashto, Persian-Farsi, Serbian-Croatian,
Russian, Portuguese, and any other language identified by the
Secretary of Education, in consultation with the Defense
Language Institute, the Foreign Service Institute, and the
National Security Education Program, as a critical foreign
language need.
``(2) Early childhood educator.--The term `early childhood
educator' means an early childhood educator who works directly
with children in an eligible preschool program or eligible
early childhood education program who has completed a
baccalaureate or advanced degree in early childhood
development, early childhood education, or in a field related
to early childhood education.
``(3) Eligible preschool program.--The term `eligible
preschool program' means a program that provides for the care,
development, and education of infants, toddlers, or young
children age 5 and under, meets any applicable State or local
government licensing, certification, approval, and registration
requirements, and is operated by--
``(A) a public or private school that is supported,
sponsored, supervised, or administered by a local
educational agency;
``(B) a Head Start agency serving as a grantee
designated under the Head Start Act (42 U.S.C. 9831 et
seq.);
``(C) a nonprofit or community based organization;
or
``(D) a child care program, including a home.
``(4) Eligible early childhood education program.--The term
`eligible early childhood education program' means--
``(A) a family child care program, center-based
child care program, State prekindergarten program,
school program, or other out-of-home early childhood
development care program, that--
``(i) is licensed or regulated by the
State; and
``(ii) serves 2 or more unrelated children
who are not old enough to attend kindergarten;
``(B) a Head Start Program carried out under the
Head Start Act (42 U.S.C. 9831 et seq.); or
``(C) an Early Head Start Program carried out under
section 645A of the Head Start Act (42 U.S.C. 9840a).
``(5) Low-income community.--In this subsection, the term
`low-income community' means a community in which 70 percent of
households earn less than 85 percent of the State median
household income.
``(6) Nurse.--The term `nurse' means a nurse who meets all
of the following:
``(A) The nurse graduated from--
``(i) an accredited school of nursing (as
those terms are defined in section 801 of the
Public Health Service Act (42 U.S.C. 296));
``(ii) a nursing center; or
``(iii) an academic health center that
provides nurse training.
``(B) The nurse holds a valid and unrestricted
license to practice nursing in the State in which the
nurse practices in a clinical setting.
``(C) The nurse holds one or more of the following:
``(i) A graduate degree in nursing, or an
equivalent degree.
``(ii) A nursing degree from a collegiate
school of nursing (as defined in section 801 of
the Public Health Service Act (42 U.S.C. 296)).
``(iii) A nursing degree from an associate
degree school of nursing (as defined in section
801 of the Public Health Service Act (42 U.S.C.
296)).
``(iv) A nursing degree from a diploma
school of nursing (as defined in section 801 of
the Public Health Service Act (42 U.S.C. 296)).
``(7) Speech-language pathologist.--The term `speech-
language pathologist' means a speech-language pathologist who--
``(A) has received, at a minimum, a graduate degree
in speech-language pathology or communication sciences
and disorders from an institution of higher education
accredited by an agency or association recognized by
the Secretary pursuant to section 496(a) of this Act;
and
``(B) provides speech-language pathology services
under section 1861(ll)(1) of the Social Security Act
(42 U.S.C. 1395x(ll)(1), or meets or exceeds the
qualifications for a qualified speech-language
pathologist under subsection (ll)(3) of such section
(42 U.S.C. 1395x(ll)(3)).
``(h) Program Funding.--There shall be available to the Secretary
to carry out this section, from funds not otherwise appropriated, such
sums as may be necessary to provide loan forgiveness in accordance with
this section to each eligible individual.''.
SEC. 132. INCOME-CONTINGENT REPAYMENT FOR PUBLIC SECTOR EMPLOYEES.
Section 455(e) (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 is employed, and was employed
for the 10-year period in 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
emergency management, government, public safety, law
enforcement, public health, education (including early
childhood education), social work in a public child or
family service agency, or public interest legal
services (including prosecution or public defense).
``(8) Return to standard repayment.--A borrower who is
repaying a loan made under this part pursuant to income-
contingent repayment may choose, at any time, to terminate
repayment pursuant to income-contingent repayment and repay
such loan under the standard repayment plan.''.
SEC. 133. INCOME-BASED REPAYMENT.
(a) Amendment.--Part G of title IV (20 U.S.C. 1088 et seq.) is
further amended by adding at the end the following:
``SEC. 493C. INCOME-BASED REPAYMENT.
``(a) Definitions.--In this section:
``(1) Excepted plus loan.--The term `excepted PLUS loan'
means a loan under section 428B, or a Federal Direct PLUS Loan,
that is made, insured, or guaranteed on behalf of a dependent
student.
``(2) Partial financial hardship.--The term `partial
financial hardship', when used with respect to a borrower,
means that for such borrower--
``(A) the annual amount due on the total amount of
loans made, insured, or guaranteed under part B or D
(other than an excepted PLUS loan) to a borrower as
calculated under the standard repayment plan under
section 428(b)(9)(A)(i) or 455(d)(1)(A); exceeds
``(B) 15 percent of the result obtained by
calculating the amount by which--
``(i) the borrower's, and the borrower's
spouse's (if applicable), adjusted gross
income; exceeds
``(ii) 150 percent of the poverty line
applicable to the borrower's family size as
determined under section 673(2) of the
Community Services Block Grant Act (42 U.S.C.
9902(2)).
``(b) Income-Based Repayment Program Authorized.--Notwithstanding
any other provision of this Act, the Secretary shall carry out a
program under which--
``(1) a borrower of any loan made, insured, or guaranteed
under part B or D (other than an excepted PLUS loan) who has a
partial financial hardship may elect, during any period the
borrower has the partial financial hardship, to have the
borrower's aggregate monthly payment for all such loans not
exceed the result described in subsection (a)(2)(B) divided by
12;
``(2) the holder of such a loan shall apply the borrower's
monthly payment under this subsection first toward interest due
on the loan and then toward the principal of the loan;
``(3) any interest due and not paid under paragraph (2)
shall be capitalized;
``(4) any principal due and not paid under paragraph (2)
shall be deferred;
``(5) the amount of time the borrower makes monthly
payments under paragraph (1) may exceed 10 years;
``(6) if the borrower no longer has a partial financial
hardship or no longer wishes to continue the election under
this subsection, then--
``(A) the maximum monthly payment required to be
paid for all loans made to the borrower under part B or
D (other than an excepted PLUS loan) shall not exceed
the monthly amount calculated under section
428(b)(9)(A)(i) or 455(d)(1)(A) when the borrower first
made the election described in this subsection; and
``(B) the amount of time the borrower is permitted
to repay such loans may exceed 10 years;
``(7) the Secretary shall repay or cancel any outstanding
balance of principal and interest due on all loans made under
part B or D (other than a loan under section 428B or a Federal
Direct PLUS Loan) to a borrower who--
``(A) is in deferment due to an economic hardship
described in section 435(o) for a period of time
prescribed by the Secretary, not to exceed 20 years; or
``(B)(i) makes the election to participate in
income-based repayment under paragraph (1); and
``(ii) for a period of time prescribed by the
Secretary, not to exceed 20 years (including any period
during which the borrower is in deferment due to an
economic hardship described in section 435(o)), meets 1
or more of the following requirements:
``(I) has made reduced monthly payments
under paragraph (1);
``(II) has made monthly payments of not
less than the monthly amount calculated under
section 428(b)(9)(A)(i) or 455(d)(1)(A) when
the borrower first made the election described
in this subsection;
``(III) has made payments under a standard
repayment plan under section 428(b)(9)(A)(i) or
455(d)(1)(A);
``(IV) has made payments under an income-
contingent repayment plan under section
455(d)(1)(D); and
``(8) a borrower who is repaying a loan made under this
part pursuant to income-based repayment may elect, at any time,
to terminate repayment pursuant to income-based repayment and
repay such loan under the standard repayment plan.''.
(b) Conforming ICR Amendment.--Section 455(d)(1)(D) (20 U.S.C.
1087e(d)(1)(D)) is amended by inserting ``made on behalf of a dependent
student'' after ``PLUS loan''.
SEC. 134. DEFINITION OF ECONOMIC HARDSHIP.
Section 435(o) (20 U.S.C. 1085(o)) is amended--
(1) in paragraph (1)--
(A) in subparagraph (A)(ii)--
(i) by striking ``100 percent of the
poverty line for a family of 2'' and inserting
``150 percent of the poverty line applicable to
the borrower's family size''; and
(ii) by inserting ``or'' after the
semicolon;
(B) by striking subparagraph (B); and
(C) by redesignating subparagraph (C) as
subparagraph (B); and
(2) in paragraph (2), by striking ``(1)(C)'' and inserting
``(1)(B)''.
SEC. 135. DEFERRALS.
(a) FISL.--Section 427(a)(2)(C)(iii) (20 U.S.C. 1077(a)(2)(C)(iii))
is amended by striking ``not in excess of 3 years''.
(b) Interest Subsidies.--Section 428(b)(1)(M)(iv) (20 U.S.C.
1078(b)(1)(M)(iv)) is amended by striking ``not in excess of 3 years''.
(c) Direct Loans.--Section 455(f)(2)(D) (20 U.S.C. 1087e(f)(2)(D))
is amended by striking ``not in excess of 3 years''.
(d) Perkins.--Section 464(c)(2)(A)(iv) (20 U.S.C.
1087dd(c)(2)(A)(iv)) is amended by striking ``not in excess of 3
years''.
SEC. 136. MAXIMUM REPAYMENT PERIOD.
(a) In General.--Section 455(e) (20 U.S.C. 1087e(e)) is amended by
adding at the end the following:
``(9) Maximum repayment period.--In calculating the
extended period of time for which an income-contingent
repayment plan under this subsection may be in effect for a
borrower, the Secretary shall include all time periods during
which a borrower of loans under part B, part D, or part E--
``(A) is not in default on any loan that is
included in the income-contingent repayment plan; and
``(B)(i) is in deferment due to an economic
hardship described in section 435(o);
``(ii) makes monthly payments under paragraph (1)
or (6) of section 493C(b); or
``(iii) makes payments under a standard repayment
plan described in section 428(b)(9)(A)(i) or subsection
(d)(1)(A).''.
(b) Technical Correction.--Section 455(d)(1)(C) (20 U.S.C.
1087e(d)(1)(C)) is amended by striking ``428(b)(9)(A)(v)'' and
inserting ``428(b)(9)(A)(iv)''.
SEC. 137. DEFERRAL OF LOAN REPAYMENT FOLLOWING ACTIVE DUTY.
Part G of title IV is amended by inserting after section 484B (20
U.S.C. 1091b) the following new section:
``SEC. 484C. DEFERRAL OF LOAN REPAYMENT FOLLOWING ACTIVE DUTY.
``(a) Deferral of Loan Repayment Following Active Duty.--In
addition to any deferral of repayment of a loan made under this title
pursuant to section 428(b)(1)(M)(iii), 455(f)(2)(C), or
464(c)(2)(A)(ii), a borrower of a loan under this title who is a member
of the National Guard or other reserve component of the Armed Forces of
the United States, or a member of such Armed Forces in a retired
status, is called or ordered to active duty, and is currently enrolled,
or was enrolled within six months prior to the activation, in a program
of instruction at an eligible institution, shall be eligible for a
deferment during the 13 months following the conclusion of such
service, except that a deferment under this subsection shall expire
upon the borrower's return to enrolled student status.
``(b) Active Duty.--Notwithstanding section 481(d), in this
section, the term `active duty' has the meaning given such term in
section 101(d)(1) of title 10, United States Code, except that such
term--
``(1) does not include active duty for training or
attendance at a service school; but
``(2) includes, in the case of members of the National
Guard, active State duty.''.
SEC. 138. SENSE OF THE CONGRESS; REPORT.
(a) Sense of Congress.--It is the sense of the Congress that--
(1) in order to provide the borrowers of Federal student
loans with the option of converting their loans to income-
contingent repayment by providing direct loans for the
discharge of such loans (in this section referred to as
``direct IDEA loans''), the Secretary of Education and the
Secretary of the Treasury will work together with the
Government Accountability Office to develop a process by which
the borrower will make payments on such loan using the income
tax withholding system and will make appropriate adjustments to
his or her withholding or estimated tax payments for such
purposes;
(2) the Secretaries shall determine--
(A) whether such a repayment option would be
beneficial to borrowers and taxpayers; and
(B) how such program would be implemented by the
Departments of Education and Treasury; and
(3) this process would--
(A) streamline the repayment process and provide
greater flexibility for borrowers electing to use the
direct IDEA loan;
(B) significantly reduce the number of loan
defaults by borrowers; and
(C) significantly reduce the redundancy in
reporting information pertaining to income-contingent
repayment to the Department of Education, institutions,
and applicants.
(b) Report.--The Secretaries of Education and the Treasury shall,
within one year after the date of enactment of this Act--
(1) provide the Congress with information on the progress
in devising the direct IDEA loan with income-contingent
repayment using the income tax withholding system;
(2) inform the Congress of any necessary statutory changes
for the purpose of establishing a direct IDEA loan with income-
contingent repayment using the income tax withholding system;
and
(3) consider international programs demonstrating
implementation of income-contingent repayment collected through
revenue services, such as programs in England, Australia, and
New Zealand.
PART D--SUSTAINING THE PERKINS LOAN PROGRAM
SEC. 141. FEDERAL PERKINS LOANS.
Section 461(b) (20 U.S.C. 1087aa(b)) is amended by adding at the
end the following new paragraphs:
``(3) In addition to any amounts appropriated pursuant to
paragraph (1) or (2) of this subsection, there shall be
available to the Secretary for contributions to student loan
funds established under part E, from funds not otherwise
appropriated, $100,000,000 for each of the fiscal years 2008
through 2012. The sum of the amount made available under this
subsection for any such fiscal year, plus the amount so
appropriated for such fiscal year, shall, for purposes of
allocations under section 462, be treated as the amount
appropriated pursuant to section 461(b) for such fiscal year.
``(4) The authority to make contributions to student loan
funds under this part shall expire at the end of fiscal year
2012.''.
TITLE II--REDUCING THE COST OF COLLEGE
SEC. 201. STATE COMMITMENT TO AFFORDABLE COLLEGE EDUCATION.
Title I is amended by inserting after section 131 (20 U.S.C. 1015)
the following new section:
``SEC. 132. STATE COMMITMENT TO AFFORDABLE COLLEGE EDUCATION.
``(a) Maintenance of Effort Required.--No State shall reduce the
total amount provided by the State for public institutions of higher
education in such State for any academic year beginning on or after
July 1, 2008, to an amount which is less than the average amount
provided by such State to such institutions of higher education during
the 5 most recent preceeding academic years for which satisfactory data
is available.
``(b) Waiver.--The Secretary may waive the requirements of this
section, if the Secretary determines that such a waiver would be
equitable due to exceptional or uncontrollable circumstances, such as a
natural disaster or a precipitous and unforeseen decline in the
financial resources of the State educational agency.
``(c) Withholding of All LEAP Funds for Violations.--
Notwithstanding any other provision of law, the Secretary of Education
shall withhold from any State that violates subsection (a) (except a
State that receives a waiver under subsection (b)) any amount that
would otherwise be available to the State under the Leveraging
Educational Assistance Partnership Program under subpart 4 of part A of
title IV until such State has corrected such violation.''.
SEC. 202. CONSUMER INFORMATION AND PUBLIC ACCOUNTABILITY IN HIGHER
EDUCATION.
Section 131 of the Higher Education Act of 1965 (20 U.S.C. 1015) is
amended to read as follows:
``SEC. 131. CONSUMER INFORMATION AND PUBLIC ACCOUNTABILITY IN HIGHER
EDUCATION.
``(a) College Opportunity On-Line (COOL) Website Re-Design
Process.--In carrying out this section, the Commissioner of Education
Statistics--
``(1) shall identify the data elements related to college
costs that are of greatest importance to prospective students,
enrolled students, and their families, paying particular
attention to low-income, non-traditional student populations,
and first-generation college students;
``(2) shall convene a group of individuals with expertise
in the collection and reporting of data related to institutions
of higher education, the use of consumer data, and consumer
marketing in general to--
``(A) determine the relevance of particular data
elements to prospective students, enrolled students,
and families;
``(B) assess the cost-effectiveness of various ways
in which institutions of higher education might produce
relevant data;
``(C) determine the general comparability of the
data across institutions of higher education; and
``(D) make recommendations regarding the inclusion
of specific data items and the most effective and least
burdensome methods of collecting and reporting useful
data from institutions of higher education; and
``(3) shall ensure that the redesigned COOL website--
``(A) uses, to the extent practicable, data
elements currently provided by institutions of higher
education to the Secretary;
``(B) includes clear and uniform information
determined to be relevant to prospective students,
enrolled students, and families;
``(C) provides comparable information, by ensuring
that data are based on accepted criteria and common
definitions;
``(D) includes a sorting function that permits
users to customize their search for and comparison of
institutions of higher education based on the
information identified through the process as
prescribed in paragraph (1) as being of greatest
relevance to choosing an institution of higher
education.
``(b) Data Collection.--
``(1) Data system.--The Commissioner of Education
Statistics shall continue to redesign the relevant parts of the
Integrated Postsecondary Education Data System to include
additional data as required by this section and to continue to
improve the usefulness and timeliness of data collected by such
System in order to inform consumers about institutions of
higher education.
``(2) College consumer profile.--The Secretary shall
continue to publish on the COOL website, for each academic year
and in accordance with standard definitions developed by the
Commissioner of Education Statistics (including definitions
developed under section 131(a)(3)(A) as in effect on the day
before the date of enactment of the College Cost Reduction Act
of 2007), from at least all institutions of higher education
participating in programs under title IV the following
information:
``(A) The tuition and fees charged for a first-
time, full-time undergraduate student.
``(B) The room and board charges for a first-time,
full-time undergraduate student.
``(C) The price of attendance for a first-time,
full-time undergraduate student, consistent with the
provisions of section 472.
``(D) The average amount of financial assistance
received by a first-year, full-time undergraduate
student, including--
``(i) each type of assistance or benefits
described in 428(a)(2)(C)(ii);
``(ii) institutional and other assistance;
and
``(iii) Federal loans under parts B, D, and
E of title IV.
``(E) The number of first-time, full-time
undergraduate students receiving financial assistance
described in each clause of subparagraph (D).
``(F) The institutional instructional expenditure
per full-time equivalent student.
``(G) Student enrollment information, including
information on the number and percentage of full-time
and part-time students, and the number and percentage
of resident and non-resident students.
``(H) Faculty-to-student ratios.
``(I) Faculty information, including the total
number of faculty and the percentage of faculty who are
full-time employees of the institution and the
percentage who are part-time.
``(J) Completion and graduation rates of
undergraduate students, identifying whether the
completion or graduation rates are from a 2-year or 4-
year program of instruction and, in the case of a 2-
year program of instruction, the percentage of students
who transfer to 4-year institutions prior or subsequent
to completion or graduation.
``(K) A link to the institution of higher education
with information of interest to students including
mission, accreditation, student services (including
services for students with disabilities), transfer of
credit policies, any articulation agreements entered
into by the institution, and, if appropriate, placement
rates and other measures of success in preparing
students for entry into or advancement in the
workforce.
``(L) The college affordability information
elements specified in subsection (c).
``(M) Any additional information that the Secretary
may require.
``(c) College Affordability Information Elements.--The college
affordability information elements required by subsection (b)(2)(L)
shall include, for each institution submitting data--
``(1) the sticker price of the institution for the 3 most
recent academic years;
``(2) the net tuition price of the institution for the 3
most recent academic years;
``(3) the percentage change in both the sticker price and
the net tuition price over the 3-year time period that is being
reported;
``(4) the percentage change in the higher education price
index (as defined in section 401B(d)) over the same 3-year time
period; and
``(5) whether the institution has been placed on
affordability alert status as required by subsection (d)(2).
``(d) Outcomes and Actions.--
``(1) Response from institution.--Effective on June 30,
2008, an institution that increases its sticker price at a
percentage rate for any 3-year interval ending on or after that
date that exceeds two times the rate of change in the higher
education price index (as defined in section 401B(d)) over the
same time period shall provide a report to the Secretary, in
such a form, at such time, and containing such information as
the Secretary may require. Such report shall be published by
the Secretary on the COOL website, and shall include--
``(A) a description of the factors contributing to
the increase in the institution's costs and in the
tuition and fees charged to students; and
``(B) if determinations of tuition and fee
increases are not within the exclusive control of the
institution, a description of the agency or
instrumentality of State government or other entity
that participates in such determinations and the
authority exercised by such agency, instrumentality, or
entity.
``(2) Consequences for 2-year continuation of failure.--If
the Secretary determines that an institution that is subject to
paragraph (1) has failed to reduce the subsequent increase in
sticker price to equal to or below two times the rate of change
in the higher education price index (as defined in section
401B(d)) for 2 consecutive academic years subsequent to the 3-
year interval used under paragraph (1), the Secretary shall
place the institution on affordability alert status.
``(3) Exemptions.--Notwithstanding paragraph (2), an
institution shall not be placed on affordability alert status
if, for any 3-year interval for which sticker prices are
computed under paragraph (1)--
``(A) with respect to the class of institutions
described in paragraph (5) to which the institution
belongs, the sticker price of the institution is in the
lowest quartile of institutions within such class, as
determined by the Secretary, during the last year of
such 3-year interval; or
``(B) the institution has a percentage change in
its sticker price computed under paragraph (1) that
exceeds two times the rate of change in the higher
education price index (as defined in section 401B(d))
over the same time period, but the dollar amount of the
sticker price increase is less than $500.
``(4) Information to state agencies.--Any institution that
reports under paragraph (1)(B) that an agency or
instrumentality of State government or other entity
participates in the determinations of tuition and fee increases
shall, prior to submitting any information to the Secretary
under this subsection, submit such information to, and request
the comments and input of, such agency, instrumentality, or
entity. With respect to any such institution, the Secretary
shall provide a copy of any communication by the Secretary with
that institution to such agency, instrumentality, or entity.
``(5) Classes of institutions.--For purposes of this
subsection, the classes of institutions shall be those sectors
used by the Integrated Postsecondary Education Data System,
based on whether the institution is public, nonprofit private,
or for-profit private, and whether the institution has a 4-
year, 2-year, or less than 2-year program of instruction.
``(6) Data rejection.--Nothing in this subsection shall be
construed as allowing the Secretary to reject the data
submitted by an individual institution of higher education.
``(e) Information to the Public.--The Secretary shall work with
public and private entities to promote broad public awareness,
particularly among middle and high school students and their families,
of the information made available under this section, including by
distribution to students who participate in or receive benefits from
means-tested federally funded education programs and other Federal
programs determined by the Secretary.
``(f) Fines.--In addition to actions authorized in section 487(c),
the Secretary may impose a fine in an amount not to exceed $25,000 on
an institution of higher education for failing to provide the
information required by this section in a timely and accurate manner,
or for failing to otherwise cooperate with the National Center for
Education Statistics regarding efforts to obtain data under subsection
(c) and pursuant to the program participation agreement entered into
under section 487.
``(g) Regulations.--The Secretary is authorized to issue such
regulations as may be necessary to carry out the provisions of this
section.
``(h) Definitions.--For the purposes of this section:
``(1) Net tuition price.--The term `net tuition price'
means the sticker price, minus the average grants provided to
such students, for any academic year.
``(2) Sticker price.--The term `sticker price' means the
average tuition and fees charged to a first-time, full-time,
full-year undergraduate student by an institution of higher
education for any academic year.''.
SEC. 203. INCENTIVES AND REWARDS FOR LOW TUITION.
Subpart 1 of part A of title IV is amended by inserting after
section 401A (20 U.S.C. 1070a-1) the following new section:
``SEC. 401B. INCENTIVES AND REWARDS FOR LOW TUITION.
``(a) Rewards for Low Tuition.--For an institution of higher
education that, for academic year 2008-2009 or any succeeding academic
year, has an annual net tuition price increase (expressed as a
percentage) for the most recent academic year for which satisfactory
data is available that is equal to or less than the percentage change
in the higher education price index for such academic year, the
Secretary shall provide such institution an amount sufficient to
provide a 25 percent increase under subpart 1 of part A of title IV to
each Pell Grant recipient attending such institution for the next award
year beginning after the date of such determination. Each such
institution shall distribute any amounts received under this subsection
among such Pell Grant recipients by increasing the amount of their Pell
Grant awards by 25 percent.
``(b) Rewards for Guaranteed Tuition.--
``(1) Bonus.--For each institution of higher education that
the Secretary of Education determines complies with the
requirements of paragraph (2) or (3) of this subsection, the
Secretary shall provide to such institution a bonus amount
equal to 25 percent of the aggregate amount of aid received by
students at the institution under section 401(a). Such
institution shall award the bonus amount to the Pell Grant
recipients who were in attendance at the institution during the
award year that such institution satisfied the eligibility
criteria for maintaining low tuition and fees. Each such
student shall receive an amount that equals 25 percent of their
total Pell Grant award for such award year, except that no
student shall recieve an amount under this section that would
cause the amount of total financial aid received by such
student to exceed the cost of attendance of the institution. If
there are additional funds remaining after all eligible
students have been paid from the bonus amount, the institution
shall award all excess funds first to remaining Pell Grant
recipients who were not in attendance at the institution during
such award year, and then to other eligible students under this
title in attendance at such institution in the form of need-
based aid.
``(2) 4-year institutions.--An institution of higher
education that provides a program of instruction for which it
awards a bachelor's degree complies with the requirements of
this paragraph if such institution guarantees that for any
academic year beginning on or after July 1, 2008, and for each
of the 4 succeeding continuous academic years, the net tuition
price charged to an undergraduate student will not exceed--
``(A) the amount that the student was charged for
an academic year at the time he or she first enrolled
in the institution of higher education, plus
``(B) the product of the percentage increase in the
higher education price index for the prior academic
year, or the most recent prior academic year for which
data is available, multiplied by the amount determined
under subparagraph (A).
``(3) Less-than 4-year institutions.--An institution of
higher education that does not provide a program of instruction
for which it awards a bachelor's degree complies with the
requirements of this paragraph if such institution guarantees
that for any academic year (or the equivalent) beginning on or
after July 1, 2008, and for each of the 1.5 succeeding
continuous academic years, the net tuition price charged to an
undergraduate student will not exceed--
``(A) the amount that the student was charged for
an academic year at the time he or she first enrolled
in the institution of higher education, plus
``(B) the product of the percentage increase in the
higher education price index for the prior academic
year, or the most recent prior academic year for which
data is available, multiplied by the amount determined
under subparagraph (A).
``(c) Maintaining Affordable Tuition.--For any institution of
higher education whose increase in the annual net tuition price
(expressed as a percentage), for the most recent academic year for
which satisfactory data is available, is greater than the percentage
increase in the higher education price index for such academic year,
the Secretary shall require such institution to submit to the Secretary
the following information, within 6 months of such determination:
``(1) a detailed report on the exact causes for the net
tuition price increase that outlines revenues and expenditures;
and
``(2) cost containment strategies to lower net tuition
prices.
``(d) Priority.--In awarding incentives and rewards under this
section, the Secretary shall give priority to institutions of higher
education with the lowest annual net tuition price increase (expressed
as a percentage) for the most recent academic year for which
satisfactory data is available, when compared with other institutions
of higher education with annual net tuition price increases that are
equal to or less than the percentage change in the higher education
price index for such academic year.
``(e) Definitions.--
``(1) Net tuition price.--The term `net tuition price' has
the same meaning as provided in section 131(k).
``(2) Higher education price index.--The term `higher
education price index' means a statistical measure of change
over time in the prices of a fixed market basket of goods and
services purchased by colleges and universities through current
fund educational and general expenditures (excluding
expenditures for research), as developed by the Bureau of Labor
Statistics.
``(f) Funding.--There shall be available to the Secretary to carry
out this section, from funds not otherwise appropriated, $15,000,000
for each of the fiscal years 2008 through 2012.
``(g) Sunset.--The authority to carry out this section shall expire
at the end of fiscal year 2012.''.
SEC. 204. COOPERATIVE EDUCATION REWARDS FOR INSTITUTIONS THAT RESTRAIN
TUITION INCREASES.
The Higher Education Act of 1965 (20 U.S.C. 1001 et seq.) is
amended by adding at the end the following title:
``TITLE VIII--COOPERATIVE EDUCATION REWARDS FOR INSTITUTIONS THAT
RESTRAIN TUITION INCREASES
``SEC. 801. DEFINITION OF COOPERATIVE EDUCATION.
``For the purpose of this title the term `cooperative education'
means the provision of alternating or parallel periods of academic
study and public or private employment in order to give students work
experiences related to their academic or occupational objectives and an
opportunity to earn the funds necessary for continuing and completing
their education.
``SEC. 802. AUTHORIZATION OF APPROPRIATIONS; RESERVATIONS.
``(a) Appropriations.--There shall be available to the Secretary to
carry out this title from funds not otherwise appropriated $15,000,000
for each of the fiscal years 2008 through 2012.
``(b) Reservations.--Of the amount appropriated for each such
fiscal year--
``(1) not less than 50 percent shall be available for
carrying out grants to institutions of higher education and
combinations of such institutions described in section
803(a)(1)(A) for cooperative education under section 803;
``(2) not less than 25 percent shall be available for
carrying out grants to institutions of higher education
described in section 803(a)(1)(B) for cooperative education
under section 803;
``(3) not more than 11 percent shall be available for
demonstration projects under paragraph (1) of section 804(a);
``(4) not more than 11 percent shall be available for
training and resource centers under paragraph (2) of section
804(a); and
``(5) not more than 3 percent shall be available for
research under paragraph (3) of section 804(a).
``(c) Availability of Appropriations.--Appropriations under this
title shall not be available for the payment of compensation of
students for employment by employers under arrangements pursuant to
this title.
``(d) Sunset.--The authority to carry out this title shall expire
at the end of fiscal year 2012.
``SEC. 803. GRANTS FOR COOPERATIVE EDUCATION.
``(a) Grants Authorized.--
``(1) In general.--The Secretary is authorized--
``(A) from the amount available under section
802(b)(1) in each fiscal year and in accordance with
the provisions of this title, to make grants to
institutions of higher education or combinations of
such institutions that have not previously received a
grant under this paragraph to pay the Federal share of
the cost of planning, establishing, expanding, or
carrying out programs of cooperative education by such
institutions or combinations of institutions; and
``(B) from the amount available under section
802(b)(2) in each fiscal year and in accordance with
the provisions of this title, to make grants to
institutions of higher education that are operating an
existing cooperative education program (as determined
by the Secretary) to pay the cost of planning,
establishing, expanding, or carrying out programs of
cooperative education by such institutions.
``(2) Program requirement.--Cooperative education programs
assisted under this section shall provide alternating or
parallel periods of academic study and of public or private
employment, giving students work experience related to their
academic or occupational objectives and the opportunity to earn
the funds necessary for continuing and completing their
education.
``(3) Amount of grants.--
``(A) The amount of each grant awarded pursuant to
paragraph (1)(A) to any institution of higher education
or combination of such institutions in any fiscal year
shall not exceed $500,000.
``(B)(i) Except as provided in clauses (ii) and
(iii), the Secretary shall award grants in each fiscal
year to each institution of higher education described
in paragraph (1)(B) that has an application approved
under subsection (b) in an amount which bears the same
ratio to the amount reserved pursuant to section
802(b)(2) for such fiscal year as the number of
unduplicated students placed in cooperative education
jobs during the preceding fiscal year (other than
cooperative education jobs under section 804 and as
determined by the Secretary) by such institution of
higher education bears to the total number of all such
students placed in such jobs during the preceding
fiscal year by all such institutions.
``(ii) No institution of higher education shall
receive a grant pursuant to paragraph (1)(B) in any
fiscal year in an amount which exceeds 25 percent of
such institution's cooperative education program's
personnel and operating budget for the preceding fiscal
year.
``(iii) The minimum annual grant amount which an
institution of higher education is eligible to receive
under paragraph (1)(B) is $1,000 and the maximum annual
grant amount is $75,000.
``(4) Limitation.--The Secretary shall not award grants
pursuant to paragraphs (1)(A) and (1)(B) to the same
institution of higher education or combination of such
institution in any one fiscal year.
``(5) Uses.--Grants under paragraph (1)(B) shall be used
exclusively--
``(A) to expand the quality and participation of a
cooperative education program;
``(B) for outreach in new curricular areas; and
``(C) for outreach to potential participants
including underrepresented and nontraditional
populations.
``(b) Applications.--Each institution of higher education or
combination of such institutions desiring to receive a grant under this
section shall submit an application to the Secretary at such time and
in such manner as the Secretary shall prescribe. Each such application
shall--
``(1) set forth the program or activities for which a grant
is authorized under this section;
``(2) specify each portion of such program or activities
which will be performed by a nonprofit organization or
institution other than the applicant, and the compensation to
be paid for such performance;
``(3) provide that the applicant will expend during such
fiscal year for the purpose of such program or activities not
less than the amount expended for such purpose during the
previous fiscal year;
``(4) describe the plans which the applicant will carry out
to assure, and contain a formal statement of the institution's
commitment which assures, that the applicant will continue the
cooperative education program beyond the 5-year period of
Federal assistance described in subsection (c)(1) at a level
which is not less than the total amount expended for such
program during the first year such program was assisted under
this section;
``(5) provide that, in the case of an institution of higher
education that provides a 2-year program which is acceptable
for full credit toward a bachelor's degree, the cooperative
education program will be available to students who are
certificate or associate degree candidates and who carry at
least one-half the normal full-time academic workload;
``(6) provide that the applicant will--
``(A) for each fiscal year for which the applicant
receives a grant, make such reports with respect to the
impact of the cooperative education program in the
previous fiscal year as may be essential to ensure that
the applicant is complying with the provisions of this
section, including--
``(i) the number of unduplicated student
applicants in the cooperative education
program;
``(ii) the number of unduplicated students
placed in cooperative education jobs;
``(iii) the number of employers who have
hired cooperative education students;
``(iv) the average income for students
derived from working in cooperative education
jobs; and
``(v) the increase or decrease in the
number of unduplicated students placed in
cooperative education jobs in each fiscal year
compared to the previous fiscal year; and
``(B) keep such records as are essential to ensure
that the applicant is complying with the provisions of
this title, including the notation of cooperative
education employment on the student's transcript;
``(7) describe the extent to which programs in the academic
discipline for which the application is made have had a
favorable reception by public and private sector employers;
``(8) describe the extent to which the institution is
committed to extending cooperative education on an institution-
wide basis for all students who can benefit;
``(9) describe the plans that the applicant will carry out
to evaluate the applicant's cooperative education program at
the end of the grant period;
``(10) provide for such fiscal control and fund accounting
procedures as may be necessary to assure proper disbursement
of, and accounting for, Federal funds paid to the applicant
under this title;
``(11) demonstrate a commitment to serving all underserved
populations; and
``(12) include such other information as is essential to
carry out the provisions of this title.
``(c) Duration of Grants; Federal Share.--
``(1) Duration of grants.--No individual institution of
higher education may receive, individually or as a participant
in a combination of such institutions--
``(A) a grant pursuant to subsection (a)(1)(A) for
more than 5 fiscal years; or
``(B) a grant pursuant to subsection (a)(1)(B) for
more than 5 fiscal years.
``(2) Federal share.--The Federal share of a grant under
section 803(a)(1)(A) may not exceed--
``(A) 85 percent of the cost of carrying out the
program or activities described in the application in
the first year the applicant receives a grant under
this section;
``(B) 70 percent of such cost in the second such
year;
``(C) 55 percent of such cost in the third such
year;
``(D) 40 percent of such cost in the fourth such
year; and
``(E) 25 percent of such cost in the fifth such
year.
``(3) Special rule.--Any provision of law to the contrary
notwithstanding, the Secretary shall not waive the provisions
of this subsection.
``(d) Maintenance of Effort.--If the Secretary determines that a
recipient of funds under this section has failed to maintain the fiscal
effort described in subsection (b)(3), then the Secretary may elect not
to make grant payments under this section to such recipient.
``SEC. 804. DEMONSTRATION AND INNOVATION PROJECTS; TRAINING AND
RESOURCE CENTERS; AND RESEARCH.
``(a) Authorization.--The Secretary is authorized, in accordance
with the provisions of this section, to make grants and enter into
contracts--
``(1) from the amounts available in each fiscal year under
section 802(b)(3), for the conduct of demonstration projects
designed to demonstrate or determine the feasibility or value
of innovative methods of cooperative education;
``(2) from the amounts available in each fiscal year under
section 802(b)(4), for the conduct of training and resource
centers designed to--
``(A) train personnel in the field of cooperative
education;
``(B) improve materials used in cooperative
education programs if such improvement is conducted in
conjunction with other activities described in this
paragraph;
``(C) furnish technical assistance to institutions
of higher education to increase the potential of the
institution to continue to conduct a cooperative
education program without Federal assistance;
``(D) encourage model cooperative education
programs which furnish education and training in
occupations in which there is a national need;
``(E) support partnerships under which an
institution carrying out a comprehensive cooperative
education program joins with one or more institutions
of higher education in order to--
``(i) assist the institutions other than
the comprehensive cooperative education
institution to develop and expand an existing
program of cooperative education; or
``(ii) establish and improve or expand
comprehensive cooperative education programs;
and
``(F) encourage model cooperative education
programs in the fields of science and mathematics for
women and minorities who are underrepresented in such
fields; and
``(3) from the amounts available in each fiscal year under
section 802(b)(5), for the conduct of research relating to
cooperative education.
``(b) Administrative Provision.--
``(1) In general.--To carry out this section, the Secretary
may--
``(A) make grants to or contracts with institutions
of higher education, or combinations of such
institutions; and
``(B) make grants to or contracts with other public
or private nonprofit agencies or organizations,
whenever such grants or contracts will make an
especially significant contribution to attaining the
objectives of this section.
``(2) Limitation.--
``(A) The Secretary may not use more than 3 percent
of the amount appropriated to carry out this section in
each fiscal year to make grants or enter into contracts
described in paragraph (1)(A).
``(B) The Secretary may use not more than 3 percent
of the amount appropriated to carry out this section in
each fiscal year to make grants or enter into contracts
described in paragraph (1)(B).
``(c) Supplement Not Supplant.--A recipient of a grant or contract
under this section may use the funds provided only to supplement and,
to the extent possible, increase the level of funds that would, in the
absence of such funds, be made available from non-Federal sources to
carry out the activities supported by such grant or contract, and in no
case to supplant such funds from non-Federal sources.''.
TITLE III--ENSURING A HIGHLY QUALIFIED TEACHER IN EVERY CLASSROOM
PART A--TEACH GRANTS
SEC. 301. TEACH GRANTS.
Part A of title IV (20 U.S.C. 1070a et seq.) is amended by adding
at the end the following new subpart:
``Subpart 9--TEACH Grants
``SEC. 420L. PROGRAM ESTABLISHED.
``(a) Program Authority.--
``(1) Payments required.--The Secretary shall pay to each
eligible institution such sums as may be necessary to pay to
each eligible student (defined in accordance with section 484)
who files an application and agreement in accordance with
section 420M, and who qualifies--
``(A) under paragraph (2) of section 420M(a), a
TEACH Grant in the amount of $4,000 for each academic
year during which that student is in attendance at the
institution; and
``(B) under paragraphs (2) and (3) of section
420M(a), a Bonus TEACH Grant in the amount of $500 (in
addition to the amount of the TEACH Grant under
subparagraph (A)) for each academic year during which
that student so qualifies.
``(2) Reference.--Grants made under--
``(A) paragraph (1)(A) shall be known as `Teacher
Education Assistance for College and Higher Education
Grants' or `TEACH Grants'; and
``(B) paragraph (1)(B) shall be known as Bonus
TEACH Grants.
``(b) Payment Methodology.--
``(1) Prepayment.--Not less than 85 percent of any funds
provided to an institution under subsection (a) shall be
advanced to eligible institutions prior to the start of each
payment period and shall be based upon an amount requested by
the institution as needed to pay eligible students 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, except that this sentence shall not
be construed to limit the authority of the Secretary to place
an institution on a reimbursement system of payment.
``(2) Direct payment.--Nothing in this section shall be
interpreted to prohibit the Secretary from paying directly to
students, in advance of the beginning of the academic term, an
amount for which they are eligible, in cases where the eligible
institution elects not to participate in the disbursement
system required by paragraph (1).
``(3) Distribution of grants to students.--Payments under
this subpart shall be made, in accordance with regulations
promulgated by the Secretary for such purpose, in such manner
as will best accomplish the purposes of this subpart. Any
disbursement allowed to be made by crediting the student's
account shall be limited to tuition and fees and, in the case
of institutionally-owned housing, room and board. The student
may elect to have the institution provide other such goods and
services by crediting the student's account.
``(c) Reductions in Amount.--
``(1) Part-time students.--In any case where a student
attends an institution of higher education on less than a full-
time basis (including a student who attends an institution of
higher education on less than a half-time basis) during any
academic year, the amount of a grant under this subpart for
which that student is eligible shall be reduced in proportion
to the degree to which that student is not attending on a full-
time basis, in accordance with a schedule of reductions
established by the Secretary for the purposes of this subpart,
computed in accordance with this subpart. Such schedule of
reductions shall be established by regulation and published in
the Federal Register in accordance with section 482 of this
Act.
``(2) No exceeding cost.--The amount of a grant awarded
under this subpart, in combination with Federal assistance and
other student assistance, shall not exceed the cost of
attendance (as defined in section 472) at the institution at
which that student is in attendance. If, with respect to any
student, it is determined that the amount of a TEACH Grant or a
Bonus TEACH Grant exceeds the cost of attendance for that year,
the amount of the TEACH Grant or Bonus TEACH Grant,
respectively, shall be reduced until such grant does not exceed
the cost of attendance at such institution.
``(d) Period of Eligibility for Grants.--
``(1) Undergraduate students.--The period during which an
undergraduate student may receive grants under this subpart
shall be the period required for the completion of the first
undergraduate baccalaureate course of study being pursued by
that student at the institution at which the student is in
attendance except that--
``(A) any period during which the student is
enrolled in a noncredit or remedial course of study as
defined in paragraph (3) shall not be counted for the
purpose of this paragraph; and
``(B) the total amount that a student may receive
under this subpart for undergraduate study shall not
exceed $16,000 with respect to a student who receives
only TEACH Grants, and $18,000 with respect to a
student who receives TEACH Grants and Bonus TEACH
Grants.
``(2) Graduate students.--The period during which a
graduate student may receive grants under this subpart shall be
the period required for the completion of a master's degree
course of study being pursued by that student at the
institution at which the student is in attendance, except that
the total amount that a student may receive under this subpart
for graduate study shall not exceed $8,000 with respect to a
student who receives only TEACH Grants, and $10,000 with
respect to a student who receives TEACH Grants and Bonus TEACH
Grants.
``(3) Remedial course; study abroad.--Nothing in this
section shall exclude from eligibility courses of study which
are noncredit or remedial in nature (including courses in
English language acquisition) which are determined by the
institution to be necessary to help the student be prepared for
the pursuit of a first undergraduate baccalaureate degree or
certificate or, in the case of courses in English language
instruction, to be necessary to enable the student to utilize
already existing knowledge, training, or skills. Nothing in
this section shall exclude from eligibility programs of study
abroad that are approved for credit by the home institution at
which the student is enrolled.
``SEC. 420M. ELIGIBILITY; APPLICATIONS.
``(a) Applications; Demonstration of Eligibility.--
``(1) Filing required.--The Secretary shall from time to
time set dates by which students shall file applications for
grants under this subpart. Each student desiring a grant under
this subpart for any year shall file an application containing
such information and assurances as the Secretary may deem
necessary to enable the Secretary to carry out the functions
and responsibilities of this subpart.
``(2) Demonstration of teach grant eligibility.--Each
application submitted under paragraph (1) for a TEACH Grant
shall contain such information as is necessary to demonstrate
that--
``(A) if the applicant is an enrolled student--
``(i) the student is an eligible student
for purposes of section 484;
``(ii) the student--
``(I) has a grade point average
that is determined, under standards
prescribed by the Secretary, to be
comparable to a 3.25 average on a zero
to 4.0 scale, except that, if the
student is in the first year of a
program of undergraduate education,
such grade point average shall be
determined on the basis of the
student's cumulative high school grade
point average; or
``(II) displayed high academic
aptitude by receiving a score above the
75th percentile on at least one of the
batteries in an undergraduate or
graduate school admissions test; and
``(iii) the student is completing
coursework and other requirements necessary to
begin a career in teaching, or plans to
complete such coursework and requirements prior
to graduating; or
``(B) if the applicant is a current or prospective
teacher applying for a grant to obtain a graduate
degree--
``(i) the applicant is a teacher or a
retiree from another occupation with expertise
in a field in which there is a shortage of
teachers, such as math, science, special
education, English language acquisition, or
another high-need subject; or
``(ii) the applicant is or was a teacher
who is using high-quality alternative
certification routes, such as Teach for
America, to get certified.
``(3) Demonstration of bonus teach grant eligibility.--Each
application submitted under paragraph (1) for a Bonus TEACH
Grant shall contain such information as is necessary to
demonstrate that the applicant is--
``(A) eligible for, and has applied for, a TEACH
Grant; and
``(B) a student enrolled in a qualified teacher
preparation program, as defined in section 420N.
``(b) Agreements To Serve.--Each application under subsection (a)
shall contain or be accompanied by an agreement by the applicant that--
``(1) the applicant will--
``(A) serve as a full-time teacher for a total of
not less than 4 academic years within 8 years after
completing the course of study for which the applicant
received a TEACH Grant under this subpart;
``(B) teach in a school described in section
465(a)(2)(A);
``(C) with respect to an applicant for--
``(i) TEACH Grants, teach in any of the
following fields: mathematics, science, a
foreign language, bilingual education, or
special education, or as a reading specialist,
or another field documented as high-need by the
Federal Government, State government, or local
education agency and approved by the Secretary;
or
``(ii) TEACH Grants and Bonus TEACH Grants,
teach mathematics, science, or a science-
related field;
``(D) submit evidence of such employment in the
form of a certification by the chief administrative
officer of the school upon completion of each year of
such service; and
``(E) comply with the requirements for being a
highly qualified teacher as defined in section 9101 of
the Elementary and Secondary Education Act of 1965; and
``(2) in the event that the applicant is determined to have
failed or refused to carry out such service obligation, the sum
of the amounts of any TEACH Grants and Bonus TEACH Grants
received by such applicant will be treated as a loan and
collected from the applicant in accordance with subsection (c)
and the regulations thereunder.
``(c) Repayment for Failure To Complete Service.--In the event that
any recipient of a grant under this subpart fails or refuses to comply
with the service obligation in the agreement under subsection (b), the
sum of the amounts of any TEACH Grants and Bonus TEACH Grants received
by such recipient shall be treated as a Direct Loan under part D of
title IV, and shall be subject to repayment, together with interest
thereon accruing after the period of service, in accordance with terms
and conditions specified by the Secretary in regulations under this
subpart.
``SEC. 420N. DEFINITIONS.
``For the purposes of this subpart:
``(1) Eligible institution.--The term `eligible
institution' means an institution of higher education as
defined in section 102.
``(2) Qualified teacher preparation program.--The term
`qualified teacher preparation program' means a program for
students and teachers described in subparagraph (A) or (B) of
section 420M(a)(2) (referred to jointly in this paragraph as
`teacher candidates') that--
``(A) recruits and prepares teacher candidates who
major in science, technology fields, special education,
foreign language, engineering, or mathematics
disciplines to become certified as elementary and
secondary teachers in those disciplines, special
education teachers, or teachers of English Language
Learners, with the goals of improving teacher knowledge
and effectiveness and increasing elementary and
secondary student academic achievement;
``(B) is implemented by an institution of higher
education in partnership with high-need local
educational agencies;
``(C) offers a baccalaureate degree with a
concurrent teacher certification to teacher candidates;
``(D) is implemented in coordination with the
faculty of the relevant departments of the institution
of higher education;
``(E) utilizes experienced teachers who have a
demonstrated record of success in teaching underserved
students to instruct teacher candidates in the
disciplines described in subparagraph (A);
``(F) provides teacher candidates with--
``(i) support services, including mentoring
by experienced teachers who have a demonstrated
record of success in teaching underserved
students;
``(ii) exposure to, and field experience
in, the classroom within the first year of
entering the qualified teacher preparation
program; and
``(iii) other related support practices
while the teacher candidates are participating
in the program, and after such candidates
graduate from the institution of higher
education and are employed as teachers;
``(G) participates in partnerships which include
the institution of higher education and local
educational agencies and charter districts to provide
opportunities for teacher candidate field work;
``(H) focuses on increasing the number of teachers
in the disciplines described in subparagraph (A); and
``(I) encourages individuals from underrepresented
populations to enter into the teaching profession.
``SEC. 420O. PROGRAM PERIOD AND FUNDING.
``There shall be available to the Secretary to carry out this
subpart, from funds not otherwise appropriated, such sums as may be
necessary to provide TEACH Grants and Bonus TEACH Grants in accordance
with this subpart to each eligible applicant.''.
PART B--CENTERS OF EXCELLENCE
SEC. 311. CENTERS OF EXCELLENCE.
Title II (20 U.S.C. 1021 et seq.) is amended by adding at the end
the following:
``PART C--CENTERS OF EXCELLENCE
``SEC. 231. DEFINITIONS.
``As used in this part:
``(1) Eligible institution.--The term `eligible
institution' means--
``(A) an institution of higher education that has a
teacher preparation program that meets the requirements
of section 203(b)(2)and that is--
``(i) a part B institution (as defined in
section 322);
``(ii) a Hispanic-serving institution (as
defined in section 502);
``(iii) a Tribal College or University (as
defined in section 316);
``(iv) an Alaska Native-serving institution
(as defined in section 317(b)); or
``(v) a Native Hawaiian-serving institution
(as defined in section 317(b));
``(B) a consortium of institutions described in
subparagraph (A); or
``(C) an institution described in subparagraph (A),
or a consortium described in subparagraph (B), in
partnership with any other institution of higher
education, but only if the center of excellence
established under section 232 is located at an
institution described in subparagraph (A).
``(2) Highly qualified.--The term `highly qualified' when
used with respect to an individual means that the individual is
highly qualified as determined under section 9101 of the
Elementary and Secondary Education Act of 1965 (20 U.S.C. 7801)
or section 602 of the Individuals with Disabilities Education
Act (20 U.S.C. 1401).
``(3) Scientifically based reading research.--The term
`scientifically based reading research' has the meaning given
such term in section 1208 of the Elementary and Secondary
Education Act of 1965 (20 U.S.C. 6368).
``(4) Scientifically based research.--The term
`scientifically based research' has the meaning given such term
in section 9101 of the Elementary and Secondary Education Act
of 1965 (20 U.S.C. 7801).
``SEC. 232. CENTERS OF EXCELLENCE.
``(a) Program Authorized.--From the amounts appropriated to carry
out this part, the Secretary is authorized to award competitive grants
to eligible institutions to establish centers of excellence.
``(b) Use of Funds.--Grants provided by the Secretary under this
part shall be used to ensure that current and future teachers are
highly qualified, by carrying out one or more of the following
activities:
``(1) Implementing reforms within teacher preparation
programs to ensure that such programs are preparing teachers
who are highly qualified, are able to understand scientifically
based research, and are able to use advanced technology
effectively in the classroom, including use for instructional
techniques to improve student academic achievement, by--
``(A) retraining faculty; and
``(B) designing (or redesigning) teacher
preparation programs that--
``(i) prepare teachers to close student
achievement gaps, are based on rigorous
academic content, scientifically based research
(including scientifically based reading
research), and challenging State student
academic content standards; and
``(ii) promote strong teaching skills.
``(2) Providing sustained and high-quality preservice
clinical experience, including the mentoring of prospective
teachers by exemplary teachers, substantially increasing
interaction between faculty at institutions of higher education
and new and experienced teachers, principals, and other
administrators at elementary schools or secondary schools, and
providing support, including preparation time, for such
interaction.
``(3) Developing and implementing initiatives to promote
retention of highly qualified teachers and principals,
including minority teachers and principals, including programs
that provide--
``(A) teacher or principal mentoring from exemplary
teachers or principals; or
``(B) induction and support for teachers and
principals during their first 3 years of employment as
teachers or principals, respectively.
``(4) Awarding scholarships based on financial need to help
students pay the costs of tuition, room, board, and other
expenses of completing a teacher preparation program.
``(5) Disseminating information on effective practices for
teacher preparation and successful teacher certification and
licensure assessment preparation strategies.
``(6) Activities authorized under sections 202, 203, and
204.
``(c) Application.--Any eligible institution desiring a grant under
this section shall submit an application to the Secretary at such a
time, in such a manner, and accompanied by such information as the
Secretary may require.
``(d) Minimum Grant Amount.--The minimum amount of each grant under
this part shall be $500,000.
``(e) Limitation on Administrative Expenses.--An eligible
institution that receives a grant under this part may not use more than
2 percent of the grant funds for purposes of administering the grant.
``(f) Regulations.--The Secretary shall prescribe such regulations
as may be necessary to carry out this part.
``SEC. 233. APPROPRIATIONS.
``There shall be available to the Secretary, from funds not
otherwise appropriated, $50,000,000 for the period beginning with
fiscal year 2008 and ending with fiscal year 2012, to carry out this
part beginning with academic year 2008-2009, which shall remain
available until expended. The authority to carry out this part shall
expire at the end of fiscal year 2012.''.
TITLE IV--LEVERAGING FUNDS TO INCREASE COLLEGE ACCESS
PART A--STRENGTHENING HISTORICALLY BLACK COLLEGES AND UNIVERSITIES AND
MINORITY-SERVING INSTITUTIONS
SEC. 401. INVESTMENT IN HISTORICALLY BLACK COLLEGES AND UNIVERSITIES
AND MINORITY-SERVING INSTITUTION.
Title IV is amended by adding at the end the following new part:
``PART I--STRENGTHENING HISTORICALLY BLACK COLLEGES AND UNIVERSITIES
AND OTHER MINORITY-SERVING INSTITUTIONS
``SEC. 499A. INVESTMENT IN HISTORICALLY BLACK COLLEGES AND UNIVERSITIES
AND OTHER MINORITY-SERVING INSTITUTION.
``(a) Eligible Institution.--An institution of higher education is
eligible to receive funds from the amounts made available under this
section if such institution is--
``(1) a part B institution (as defined in section 322 (20
U.S.C. 1061));
``(2) a Hispanic-serving institution (as defined in section
502 (20 U.S.C. 1101a));
``(3) a Tribal College or University (as defined in section
316 (20 U.S.C. 1059c));
``(4) an Alaska Native-serving institution or a Native
Hawaiian-serving institution (as defined in section 317(b) (20
U.S.C. 1059d(b)));
``(5) a Predominantly Black Institution (as defined in
subsection (c)); or
``(6) an Asian and Pacific Islander-serving institution (as
defined in subsection (c)).
``(b) New Investment of Funds.--
``(1) In general.--There shall be available to the
Secretary to carry out this section, from funds not otherwise
appropriated, $100,000,000 for each of the fiscal years 2008
through 2012. The authority to carry out this section shall
expire at the end of fiscal year 2012.
``(2) Allocation and allotment.--
``(A) In general.--Of the amounts made available
under paragraph (1) for any fiscal year--
``(i) 40 percent shall be available for
allocation under subparagraph (B);
``(ii) 40 percent shall be available for
allocation under subparagraph (C); and
``(iii) 20 percent shall be available for
allocation under subparagraph (D).
``(B) HSI stem and articulation programs.--The
amount made available for allocation under this
subparagraph by subparagraph (A)(i) for any fiscal year
shall be available for Hispanic-serving Institutions
for activities described in section 503, with a
priority given to applications that propose--
``(i) to increase the number of Hispanic
and other low income students attaining degrees
in the fields of science, technology,
engineering and mathematics; and
``(ii) to develop model transfer and
articulation agreements between 2-year
Hispanic-serving institutions and 4-year
institutions in such fields.
``(C) Allocation and allotment hbcus and pbis.--
From the amount made available for allocation under
this subparagraph by subparagraph (A)(ii) for any
fiscal year--
``(i) $34,000,000 shall be available to
eligible institutions described in subsection
(a)(1) and shall be made available as grants
under section 323 and allotted among such
institutions under section 324, treating such
amount, plus the amount appropriated for such
fiscal year in a regular or supplemental
appropriation Act to carry out part B of title
III, as the amount appropriated to carry out
part B of title III for purposes of allotments
under section 324, for use by such institutions
with a priority for--
``(I) activities described in
paragraphs (1), (2), (4), (5), and (10)
of section 323(a); and
``(II) other activities, consistent
with the institution's comprehensive
plan and designed to increase the
institution's capacity to prepare
students for careers in the physical
and natural sciences, mathematics,
computer science and information
technology and sciences, engineering,
language instruction in the less-
commonly taught languages and
international affairs, and nursing and
allied health professions; and
``(ii) $6,000,000 shall be available to
eligible institutions described in subsection
(a)(5) and shall be available for a competitive
grant program to award 10 grants of $600,000
annually for programs in the following areas:
science, technology, engineering, or
mathematics (STEM); health education;
internationalization or globalization; teacher
preparation; or improving educational outcomes
of African American males.
``(D) Allocation and allotment to other minority-
serving institutions.--From the amount made available
for allocation under this subparagraph by subparagraph
(A)(iii) for any fiscal year (in this subparagraph
referred to as the `allocable amount')--
``(i) 60 percent of the allocable amount
for such fiscal year shall be available to
eligible institutions described in subsection
(a)(3) and shall be made available as grants
under section 316, treating such 60 percent of
the allocable amount as part of the amount
appropriated for such fiscal year in a regular
or supplemental appropriation Act to carry out
such section, and using such 60 percent for
purposes described in subsection (c) of such
section;
``(ii) 30 percent of the allocable amount
for such fiscal year shall be available to
eligible institutions described in subsection
(a)(4) and shall be made available as grants
under section 317, treating such 30 percent of
the allocable amount as part of the amount
appropriated for such fiscal year in a regular
or supplemental appropriation Act to carry out
such section and using such 60 percent for
purposes described in subsection (a) of such
section; and
``(iii) 10 percent of the allocable amount
for such fiscal year shall be available to
eligible institutions described in subsection
(a)(6) for activities described in section
311(c).
``(c) Definitions.--
``(1) Predominantly black institution.--The term
`Predominantly Black institution' means an institution of
higher education that--
``(A) has an enrollment of needy undergraduate
students as required and defined by paragraph (2);
``(B) has an average educational and general
expenditure which is low, per full-time equivalent
undergraduate student in comparison with the average
educational and general expenditure per full-time
equivalent undergraduate student of institutions that
offer similar instruction, except that the Secretary
may apply the waiver requirements described in section
392(b) to this subparagraph in the same manner as the
Secretary applies the waiver requirements to section
312(b)(1)(B);
``(C) has an enrollment of undergraduate students--
``(i) that is at least 40 percent Black
American students;
``(ii) that is at least 1,000 undergraduate
students;
``(iii) of which not less than 50 percent
of the undergraduate students enrolled at the
institution are low-income individuals or
first-generation college students (as that term
is defined in section 402A(g)); and
``(iv) of which not less than 50 percent of
the undergraduate students are enrolled in an
educational program leading to a bachelor's or
associate's degree that the institution is
licensed to award by the State in which it is
located;
``(D) is legally authorized to provide, and
provides within the State, an educational program for
which the institution of higher education awards a
bachelors degree, or in the case of a junior or
community college, an associate's degree;
``(E) is accredited by a nationally recognized
accrediting agency or association determined by the
Secretary to be a reliable authority as to the quality
of training offered, or is, according to such an agency
or association, making reasonable progress toward
accreditation; and
``(F) is not receiving assistance under part B of
title III.
``(2) Enrollment of needy students.--The term `enrollment
of needy students' means the enrollment at an eligible
institution with respect to which not less than 50 percent of
the undergraduate students enrolled in an academic program
leading to a degree--
``(A) in the second fiscal year preceding the
fiscal year for which the determination is made, were
Federal Pell Grant recipients for such year;
``(B) come from families that receive benefits
under a means-tested Federal benefits program (as
defined in paragraph (4));
``(C) attended a public or nonprofit private
secondary school--
``(i) that is in the school district of a
local educational agency that was eligible for
assistance under part A of title I of the
Elementary and Secondary Education Act of 1965
for any year during which the student attended
such secondary school; and
``(ii) which for the purpose of this
paragraph and for that year was determined by
the Secretary (pursuant to regulations and
after consultation with the State educational
agency of the State in which the school is
located) to be a school in which the enrollment
of children counted under section 1113(a)(5) of
such Act exceeds 30 percent of the total
enrollment of such school; or
``(D) are first-generation college students (as
that term is defined in section 402A(g)), and a
majority of such first-generation college students are
low-income individuals.
``(3) Low-income individual.--The term `low-income
individual' has the meaning given such term in section 402A(g).
``(4) Means-tested federal benefit program.--The term
`means-tested Federal benefit program' means a program of the
Federal Government, other than a program under title IV, in
which eligibility for the programs' benefits, or the amount of
such benefits, or both, are determined on the basis of income
or resources of the individual or family seeking the benefit.
``(5) Asian american and pacific islander-serving
institution.--The term `Asian American and Pacific Islander-
serving institution' means an institution of higher education
that--
``(A) is an eligible institution under section
312(b); and
``(B) at the time of application, has an enrollment
of undergraduate students that is at least 10 percent
Asian American and Pacific Islander students from
subgroups with low levels of college degree attainment.
``(6) Asian american.--The term `Asian American' has the
meaning given the term `Asian' in the Office of Management and
Budget's Standards for Maintaining, Collecting, and Presenting
Federal Data on Race and Ethnicity as published on October 30,
1997 (62 Fed. Reg. 58789).
``(7) Pacific islander.--The term `Pacific Islander' has
the meaning given the term `Native Hawaiian' or `Other Pacific
Islander' in such Standards for Maintaining, Collecting, and
Presenting Federal Data on Race and Ethnicity.
``(8) Low levels of college degree attainment.--The term
`low levels of college degree attainment' mean college degree
attainment that is less than 20 percent for adults ages 25
through 29 as reported by the National Center for Educational
Statistics.
``(d) Termination of Authority.--The authority to carry out this
section expires at the end of fiscal year 2012.''.
PART B--COLLEGE ACCESS CHALLENGE GRANTS
SEC. 411. COLLEGE ACCESS CHALLENGE GRANTS.
(a) Challenge Grant Program Established.--
(1) Program established.--The Secretary shall establish a
program to award matching grants to increase the number of
eligible students from underserved populations who enter and
complete college by providing grants to philanthropic
organizations who are members of eligible consortia to carry
out the activities of the consortia to achieve this purpose,
including--
(A) providing need-based grants to eligible
students;
(B) providing support to eligible students through
school- or institution-based mentoring programs; and
(C) conducting outreach programs to encourage
eligible students to pursue higher education.
(2) Grant period; renewability.--Grants under this section
shall be awarded for one 5-year period, and may not be renewed.
(3) Grant amounts.--
(A) In general.--A grant awarded under this part
for a given fiscal year to a philanthropic organization
shall be in an amount equal to the lesser of--
(i) 200 percent of the amount of charitable
gifts received in the preceding fiscal year by
the eligible consortia, including charitable
gifts received by the individual members of the
consortia with which the philanthropic
organization is associated; or
(ii) the maximum grant amount established
by the Secretary by regulation, pursuant to
subsection (f).
(B) Gifts provided in cash or in-kind.--For the
purposes of subparagraph (A), the charitable gifts
received by an eligible consortia and its members may
be provided in cash or in-kind, including physical non-
cash contributions of monetary value such as property,
facilities, and equipment, but excluding services.
(b) Uses of Grant.--
(1) In general.--A philanthropic organization receiving a
grant under this section shall--
(A) provide grants to eligible students; and
(B) distribute grants to members of the consortia
with which the philanthropic organization is
affiliated, in accordance with the plan described in
subsection (c)(2)(A), to fund the activities of such
consortia in accordance with the application under
subsection (c).
(2) Limitation.--Not more than 15 percent of the funds made
available annually through a grant under this section may be
used for administrative purposes.
(c) Applications.--A philanthropic organization desiring a grant
under this section shall submit an application to the Secretary at such
time, in such manner, and containing such information as the Secretary
may require. Such application shall include the following:
(1) A description of an eligible consortia that meets the
requirements of subsection (d), with which the philanthropic
organization is affiliated, in accordance with subsection (g).
(2) A detailed description of--
(A) the philanthropic organization's plans for
distributing the matching grant funds among the members
of the eligible consortia; and
(B) the eligible consortia's plans for using the
matching grant funds, including how the funds will be
used to provide financial aid, mentoring, and outreach
programs to eligible students.
(3) A plan to ensure the viability of the eligible
consortia and the work of the consortia beyond the grant
period.
(4) A detailed description of the activities that carry out
this section that are conducted by the eligible consortia at
the time of the application, and how the matching grant funds
will assist the eligible consortia with expanding and enhancing
such activities.
(5) A description of the organizational structure that will
be used to administer the activities carried out under the
plan, including a description of the system used to track the
participation of students who receive grants to degree
completion.
(6) A description of the strategies that will be used to
identify eligible students who are enrolled in secondary school
and who may benefit from the activities of the eligible
consortia.
(d) Eligible Consortia.--An eligible consortia with which a
philanthropic organization is affiliated for the program under this
section shall--
(1) be a partnership of mulitple entities that have agreed
to work together to carry out this section, including--
(A) such philanthropic organization, which shall
serve as the manager of the consortia;
(B) a State that demonstrates a commitment to
ensuring the creation of a Statewide system to address
the issues of early intervention and financial support
for eligible students to enter and remain in college;
and
(C) at the discretion of the philanthropic
organization described in subparagraph (A), additional
partners, including other non-profit organizations,
government entities (including local municipalities,
school districts, cities, and counties), institutions
of higher education, and other public or private
programs that provide mentoring or outreach programs;
and
(2) conduct activites to assist eligible students with
entering and remaining in college, which include--
(A) providing need-based grants to eligible
students;
(B) providing early notification to low-income
students of their potential eligibility for Federal
financial aid (which may include assisting students and
families with filling out FAFSA forms), as well as
financial aid and other support available from the
eligible consortia;
(C) encouraging increased eligible student
participation in higher education through mentoring or
outreach programs; and
(D) conducting marketing and outreach efforts that
are designed to--
(i) encourage full participation of
eligible students in the activities of the
consortia that carry out this section; and
(ii) provide the communities impacted by
the activities of the consortia with a general
knowledge about the efforts of the consortia.
(e) Annual Report.--A philanthropic organization receiving a grant
under this section shall prepare and submit an annual report to the
Secretary on the activities carried out with such grant. The report
shall include--
(1) each activity or service that was provided to eligible
students over the course of the year;
(2) the cost of providing each such activity or service;
(3) the number and percentage of eligible students who
received grants, mentoring, and outreach services; and
(4) the total amount of charitable gifts received by the
eligible consortia (including its members) with which the
philanthropic organization is affiliated for the fiscal year.
(f) Regulations.--The Secretary shall promulgate regulations to
carry out this section. Such regulations shall include--
(1) the maximum grant amount that may be awarded to a
philanthropic organization under this section;
(2) the minimum amount of chartable gifts an eligible
consortia (including its members) shall receive in a fiscal
year for the philanthropic organization affiliated with such
consortia to be eligible for a grant under this section.
(g) Definitions.--For the purposes of this section:
(1) Eligible student.--The term ``eligible student'' means
an individual who--
(A) is a member of an underserved population;
(B) is enrolled--
(i) in a secondary school pursuing a high
school diploma; or
(ii) in an institution of higher education
or is planning to attend an institution of
higher education; and
(C) either--
(i) is receiving, or has received,
financial assistance or support services from
the consortium; or
(ii) meets 2 or more of the following
criteria:
(I) Has an expected family
contribution equal to zero (as
described in section 479 of the Higher
Education Act of 1965) or a comparable
alternative based upon the State's
approved criteria in section 415C(b)(4)
of such Act.
(II) Has qualified for a free
lunch, or at the State's discretion a
reduced price lunch, under the school
lunch program established under the
Richard B. Russell National School
Lunch Act.
(III) Qualifies for the State's
maximum need-based undergraduate award.
(IV) Is participating in, or has
participated in, a Federal, State,
institutional, or community mentoring
or outreach program, as recognized by
the eligible consortia carrying out
activities under this section.
(2) Philanthropic organization.--The term ``philanthropic
organization'' means a non-profit organization--
(A) that does not receive funds under title IV of
the Higher Education Act of 1965 or under the
Elementary and Secondary Education Act of 1965;
(B) that is not a local educational agency or an
insitution of higher education;
(C) that has a demonstrated record of dispersing
grant aid to underserved populations to ensure access
to, and participation in, higher education;
(D) that is affiliated with an eligible consortia
(as defined in subsection (d)) to carry out this
section; and
(E) the primary purpose of which is to provide
financial aid and support services to students from
underrepresented populations to increase the number of
such students who enter and remain in college.
(3) State.--The term ``State'' means each of the several
States of the United States, the District of Columbia, and
Puerto Rico.
(4) Underserved population.--The term ``underserved
population'' means a group of individuals who traditionally
have not been well represented in the general population of
students who pursue and successfully complete a higher
education degree.
(h) Program Funding.--
(1) In general.--There shall be available to the Secretary
to carry out this section, from funds not otherwise
appropriated, $300,000,000 for the period beginning with fiscal
year 2008 and ending with fiscal year 2012.
(2) Use of excess funds.--If, at the end of a fiscal year,
the funds available for awarding grants under this section
exceed the amount necessary to make such grants, then all of
the excess funds shall remain available for the subsequent
fiscal year, and shall be used to award grants under section
401 of the Higher Education Act of 1965 (20 U.S.C. 1070a) for
such subsequent fiscal year.
(i) Sunset.--The authority to carry out this section shall expire
at the end of fiscal year 2012.
PART C--UPWARD BOUND
SEC. 412. UPWARD BOUND.
(a) Absolute Priority Prohibited in Upward Bound Program.--Section
402C (20 U.S.C. 1070a-13) is amended by adding at the end the following
new subsection:
``(f) Absolute Priority Prohibited in Upward Bound Program.--Except
as otherwise expressly provided by amendment to this section, the
Secretary shall not implement or enforce, and shall rescind, the
absolute priority for Upward Bound Program participant selection and
evaluation published by the Department of Education in the Federal
Register on September 22, 2006 (71 Fed. Reg. 55447 et seq.).''.
(b) Additional Funds.--Section 402C is further amended by adding
after subsection (f) (as added by subsection (a)) the following new
subsection:
``(g) Additional Funds.--
``(1) Authorization and appropriation.--There are
authorized to be appropriated, and there are appropriated to
the Secretary, from funds not otherwise appropriated,
$30,000,000 for each of the fiscal years 2008 through 2011 to
carry out paragraph (2), except that any amounts that remain
unexpended for such purpose for each of such fiscal years may
be available for technical assistance and administration costs
for the Upward Bound program.
``(2) Use of funds.--The amounts made available by
paragraph (1) shall be available to provide assistance to all
Upward Bound projects that received assistance in fiscal year
2006 but that did not receive assistance in fiscal year 2007
(other than new applicants) with a grant score above 70. Such
assistance shall be made available in the form of 4-year
grants.''.
TITLE V--ADDITIONAL PROVISIONS
SEC. 501. INDEPENDENT EVALUATION OF DISTANCE EDUCATION PROGRAMS.
(a) Independent Evaluation.--The Secretary of Education shall enter
into an agreement with the National Academy of Sciences to conduct a
scientifically correct and statistically valid evaluation of the
quality of distance education programs, as compared to campus-based
education programs, at institutions of higher education. Such
evaluation shall include--
(1) identification of the elements by which the quality of
distance education, as compared to campus-based education, can
be assessed, including elements such as subject matter,
interactivity, and student outcomes;
(2) identification of distance and campus-based education
program success, with respect to student achievement, in
relation to the mission of the institution of higher education;
and
(3) identification of the types of students (including
classification of types of students based on student age) who
most benefit from distance education programs, the types of
students who most benefit from campus-based education programs,
and the types of students who do not benefit from distance
education programs, by assessing elements including access to
higher education, job placement rates, undergraduate graduation
rates, and graduate and professional degree attainment rates.
(b) Scope.--The National Academy of Sciences shall select for
participation in the evaluation under subsection (a) a diverse group of
institutions of higher education with respect to size, mission, and
geographic distribution.
(c) Interim and Final Reports.--The agreement under subsection (a)
shall require that the National Academy of Sciences submit to the
Secretary of Education, the Committee on Health, Education, Labor and
Pensions of the Senate, and the Committee on Education and Labor of the
House of Representatives--
(1) an interim report regarding the evaluation under
subsection (a) not later than December 31, 2007; and
(2) a final report regarding such evaluation not later than
December 31, 2009.
(d) Appropriations.--There shall be available to the Secretary,
from funds not otherwise appropriated, $100,000 to carry out this
section.
SEC. 502. ENCOURAGING COLLEGES AND UNIVERSITIES TO ``GO GREEN''.
(a) Findings.--The Committee on Education and Labor of the House of
Representatives makes the following findings:
(1) A commitment to and academic programs for environmental
and economic sustainability are essential for our Nation's
future prosperity.
(2) The more than 4,200 higher education institutions in
the United States have the capacity to innovatively leverage
spending and change consumption patterns by incorporating
concepts of sustainability into their academic programs and by
modeling sustainable economic and environmental practices for
their communities.
(3) Many colleges and universities have interdisciplinary
programs or centers focusing on equipping students with the
academic content knowledge needed to understand concepts of
sustainability and ``going green''.
(4) Many colleges and universities have programs related to
the research of sustainability and sustainable systems.
(5) Academic programs related to sustainability vary in
rigor because no national education content standards for
academic sustainability programs currently exist.
(6) Colleges and universities may partner with businesses
to encourage students and faculty to translate academic
learning and research into practical solutions that promote
sustainability.
(7) Colleges and universities that make an effort to reduce
energy consumption and promote environmental sustainability not
only reduce their own emissions, but also motivate the leaders
of the next generation to action and create technical skills
and resources to develop innovative solutions.
(8) Many colleges and universities have undertaken
detailed, campus-wide assessments of their progress toward
``going green'' and sustainability or have measured their
progress in specific sectors, such as operations, or specific
parameters, such as recycling, energy, and water consumption.
(9) No system that evaluates and compares college and
university campuses in terms of overall sustainability-related
academic programs and practices currently exists.
(b) Sense of the Committee on Education and Labor.--It is the sense
of the Committee on Education and Labor that in order to encourage
increased public awareness of the need to ``go green'' by using
sustainable economic and environmental practices and rigorous
sustainability academic programs on college and university campuses,
the following should be encouraged:
(1) The development of educational standards by
institutions of higher education to determine the necessary
rigor and effectiveness of academic sustainability programs.
(2) Public awareness of the need for ``going green'' by
using sustainable economic and environmental practices.
(3) Non-governmental efforts to improve economic and
environmental sustainability efforts on college and university
campuses, including holding national summits to share best
practices.
(4) Collaborative partnerships between Federal agencies,
businesses, universities and communities to broaden
sustainability practices.
Union Calendar No. 128
110th CONGRESS
1st Session
H. R. 2669
[Report No. 110-210]
_______________________________________________________________________
A BILL
To provide for reconciliation pursuant to section 601 of the concurrent
resolution on the budget for fiscal year 2008.
_______________________________________________________________________
June 25, 2007
Reported with an amendment, committed to the Committee of the Whole
House on the State of the Union, and ordered to be printed