[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3833 Introduced in House (IH)]
<DOC>
116th CONGRESS
1st Session
H. R. 3833
To amend the Higher Education Act of 1965 to provide for the automatic
recertification of income for income-driven repayment plans, and for
other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
July 18, 2019
Ms. Bonamici (for herself, Mr. Mitchell, Mr. Moulton, and Mr.
Fitzpatrick) introduced the following bill; which was referred to the
Committee on Education and Labor, and in addition to the Committee on
Ways and Means, for a period to be subsequently determined by the
Speaker, in each case for consideration of such provisions as fall
within the jurisdiction of the committee concerned
_______________________________________________________________________
A BILL
To amend the Higher Education Act of 1965 to provide for the automatic
recertification of income for income-driven repayment plans, and for
other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Streamlining Income-driven,
Manageable Payments on Loans for Education Act'' or the ``SIMPLE Act''.
SEC. 2. AUTOMATIC INCOME MONITORING PROCEDURES AFTER A TOTAL AND
PERMANENT DISABILITY DISCHARGE.
Section 437(a) of the Higher Education Act of 1965 (20 U.S.C.
1087(a)) is amended by adding at the end the following:
``(3) Automatic income monitoring.--
``(A) In general.--Not later than 2 years after the
date of enactment of the Streamlining Income-driven,
Manageable Payments on Loans for Education Act, the
Secretary shall, with respect to each borrower and each
income-monitoring period described in subparagraph
(B)--
``(i) offer an opportunity for such
borrower to opt out of clause (ii) and prevent
the Secretary from obtaining information under
such clause;
``(ii) submit a written request to the
Secretary of the Treasury under section
6103(l)(13) of the Internal Revenue Code of
1986 for disclosure of information relating to
income, tax filing status, and number of
dependents with respect to such borrower (and
such borrower's spouse, if applicable) and such
income-monitoring period, for the purpose of
determining the borrower's continued
eligibility for the loan discharge described in
subparagraph (B) for such year; and
``(iii) provide the borrower with an
opportunity to update the information obtained
under clause (ii) before the determination of
the borrower's continued eligibility for such
loan discharge for such year.
``(B) Applicability.--Subparagraph (A) shall
apply--
``(i) to each borrower who is a borrower of
a covered loan (defined in section 455(d)(8))
that is discharged under this subsection or
section 464(c)(1)(F) due to the permanent and
total disability of the borrower; and
``(ii) during the income-monitoring period
under this subsection, defined in this
paragraph as the period--
``(I) beginning on the date on
which such loan is so discharged; and
``(II) during which the Secretary
determines whether a reinstatement of
the obligation of, and resumption of
collection on, such loan may be
necessary.
``(C) Borrower with no earned income.--In the case
of a borrower whose information received under
subparagraph (A) indicates that the borrower has no
earned income for any year of such income-monitoring
period, such borrower shall be treated as not having
earned income in excess of the poverty line for such
year.''.
SEC. 3. NOTIFICATION AND AUTOMATIC ENROLLMENT PROCEDURES FOR BORROWERS
WHO ARE DELINQUENT ON LOANS AND FOR BORROWERS WHO
REHABILITATED DEFAULTED LOANS.
(a) Amendments.--
(1) Notification and automatic enrollment procedures.--
Section 455(d) of the Higher Education Act of 1965 (20 U.S.C.
1087e(d)) is amended by adding at the end the following:
``(6) Notification and automatic enrollment procedures for
borrowers who are delinquent on loans.--
``(A) Authority to obtain income information.--In
the case of any borrower who is at least 60 days
delinquent on a covered loan, the Secretary shall
submit a written request to the Secretary of the
Treasury under section 6103(l)(13) of the Internal
Revenue Code of 1986 for disclosure of information
relating to income, tax filing status, and number of
dependents of such borrower (and such borrower's
spouse, if applicable).
``(B) Borrower notification.--With respect to each
borrower of a covered loan who is at least 60 days
delinquent on such loan and who has not been subject to
the procedures under this paragraph for such loan in
the preceding 120 days, the Secretary shall, as soon as
practicable after such 60-day delinquency, provide to
the borrower the following:
``(i) Notification that the borrower is at
least 60 days delinquent on at least 1 covered
loan, and a description of all delinquent
covered loans, nondelinquent covered loans, and
noncovered loans of the borrower.
``(ii) A brief description of the repayment
plans for which the borrower is eligible and
the covered loans and noncovered loans of the
borrower that may be eligible for such plans,
based on information available to the
Secretary.
``(iii) Clear and simple instructions on
how to select the repayment plans.
``(iv) The amount of monthly payments for
the covered and noncovered loans under the
repayment plans for which the borrower is
eligible, based on information available to the
Secretary, including, if the income information
of the borrower is available to the Secretary
under subparagraph (A)--
``(I) the amount of the monthly
payment under each income-driven
repayment plan for which the borrower
is eligible for the borrower's covered
and noncovered loans, based on such
income information; and
``(II) the income, tax filing
status, number of dependents, and tax
year information on which each monthly
payment is based.
``(v) An explanation that in the case of a
borrower for whom adjusted gross income is
unavailable--
``(I) if the borrower selects to
repay the covered loans of such
borrower pursuant to an income-driven
repayment plan that defines
discretionary income in such a manner
that an individual not required under
section 6012(a)(1) of the Internal
Revenue Code of 1986 to file a return
with respect to income taxes imposed by
subtitle A of such Code may have a
calculated monthly payment greater than
$0, the borrower will be required to
provide the Secretary with other
documentation of income satisfactory to
the Secretary, which documentation the
Secretary may use to determine an
appropriate repayment schedule; and
``(II) if the borrower selects to
repay such loans pursuant to an income-
driven repayment plan that is not
described in subclause (I), the
borrower will not be required to
provide the Secretary with such other
documentation of income, and the
borrower will have a calculated monthly
payment of $0.
``(vi) An explanation that the Secretary
shall take the actions under subparagraph (C)
with respect to such borrower, if--
``(I) the borrower is 120 days
delinquent on one or more covered loans
and has not selected a new repayment
plan for the covered loans of the
borrower; and
``(II) in the case of such a
borrower whose repayment plan for the
covered loans of the borrower is not an
income-driven repayment plan, the
monthly payments under such repayment
plan are higher than such monthly
payments would be under an income-
driven repayment plan for such loans.
``(vii) Instructions on updating the
information of the borrower obtained under
subparagraph (A).
``(C) Secretary's initial selection of plan.--With
respect to each borrower described in subparagraph (B)
who has a repayment plan for the covered loans of the
borrower that meets the requirements of clause (vi)(II)
of subparagraph (B) and has not selected a new
repayment plan for such loans in accordance with the
notice received under such subparagraph, and who is at
least 120 days delinquent on such a loan, the Secretary
shall, as soon as practicable--
``(i) in a case in which any of the
borrower's covered loans are eligible for an
income-driven repayment plan--
``(I)(aa) provide the borrower with
the income-driven repayment plan that
requires the lowest monthly payment
amount for each covered loan of the
borrower, compared to any other such
plan for which the borrower is
eligible; or
``(bb) if more than one income-
driven repayment plan would offer the
borrower the same lowest monthly
payment amount, provide the borrower
with the income-driven repayment plan
that has the most favorable terms for
the borrower;
``(II) if the plan selected under
subclause (I) is not the income-driven
repayment plan that would have the
lowest monthly payment amount if the
borrower were eligible for such plan
for the borrower's covered loans and
noncovered loans, notify the borrower
of the actions, if any, the borrower
may take to become eligible for such
income-driven repayment plan; and
``(III) authorize the borrower to
change the Secretary's selection of a
plan under this clause to any plan
described in paragraph (1) for which
the borrower is eligible; and
``(ii) in a case in which none of the
borrower's covered loans are eligible for an
income-driven repayment plan, notify the
borrower of the actions, if any, the borrower
may take for such loans to become eligible for
such a plan.
``(D) Secretary's additional selection of plan.--
``(i) In general.--With respect to each
borrower of a covered loan who selects a new
repayment plan in accordance with the notice
received under subparagraph (B) and who
continues to be delinquent on such loan for a
period described in clause (ii), the Secretary
shall, as soon as practicable after such
period, carry out the procedures described in
clauses (i) and (ii) of subparagraph (C) for
the covered loans of the borrower, if such
procedures would result in lower monthly
repayment amounts on such loan.
``(ii) Description of period.--The duration
of the period described in clause (i) shall be
the amount of time that the Secretary
determines is sufficient to indicate that the
borrower may benefit from repaying such loan
under a new repayment plan, but in no case
shall such period be less than 60 days.
``(E) Opt-out.--A borrower of a covered loan shall
have the right to opt out of the procedures under this
paragraph.
``(F) Procedures.--The Secretary shall establish
procedures as are necessary to effectively implement
this paragraph.
``(7) Notification and automatic enrollment procedures for
borrowers who are rehabilitating defaulted loans.--
``(A) Authority to obtain income information.--In
the case of any borrower who is rehabilitating a
covered loan pursuant to section 428F(a), the Secretary
may submit a written request to the Secretary of the
Treasury under section 6103(l)(13) of the Internal
Revenue Code of 1986 for disclosure of information
relating to income, tax filing status, and number of
dependents of such borrower (and such borrower's
spouse, if applicable).
``(B) Borrower notification.--Not later than 30
days after a borrower makes the 6th payment required
for the loan rehabilitation described in subparagraph
(A), the Secretary shall notify the borrower of the
process under subparagraph (C) with respect to such
loan.
``(C) Secretary's selection of plan.--With respect
to each borrower who has made the 9th payment required
for the loan rehabilitation described in subparagraph
(A), the Secretary shall, as soon as practicable after
such payment--
``(i) in a case in which any of the
borrower's covered loans, without regard to
whether the loan has been so rehabilitated, is
eligible for an income-driven repayment plan--
``(I)(aa) provide the borrower with
the income-driven repayment plan that
requires the lowest monthly payment
amount for each covered loan of the
borrower, compared to any other such
plan for which the borrower is
eligible; or
``(bb) if more than one income-
driven repayment plan would offer the
borrower the same lowest monthly
payment amount, provide the borrower
with the income-driven repayment plan
that has the most favorable terms for
the borrower; and
``(II) if the plan selected under
subclause (I) is not the income-driven
repayment plan that would have the
lowest monthly payment amount if the
borrower were eligible for such plan
for the borrower's covered loans and
noncovered loans, notify the borrower
of the actions, if any, the borrower
may take to become eligible for such
income-driven repayment plan; and
``(ii) in a case in which none of the
borrower's covered loans are eligible for an
income-driven repayment plan, notify the
borrower of the actions, if any, the borrower
may take for such a loan to become eligible for
such a plan.
``(D) Opt-out.--A borrower of a covered loan shall
have the right to opt out of the procedures under this
paragraph.
``(E) Procedures.--The Secretary shall establish
procedures as are necessary to effectively implement
this paragraph.''.
(2) Definitions.--Section 455(d) of the Higher Education
Act of 1965 (20 U.S.C. 1087e(d)), as amended by paragraph (1),
is further amended by adding at the end the following:
``(8) Definitions.--In this subsection:
``(A) Covered loan.--The term `covered loan'
means--
``(i) a loan made under this part;
``(ii) a loan purchased under section 459A;
or
``(iii) a loan that has been assigned to
the Secretary under section 428(c)(8) or part
E.
``(B) Income-driven repayment plan.--The term
`income-driven repayment plan' means a plan described
in subparagraph (D) or (E) of paragraph (1).
``(C) Noncovered loan.--The term `noncovered loan'
means a loan made, insured, or guaranteed under this
title that is not a covered loan.''.
(3) Changing plans.--Section 493C(b)(8) of the Higher
Education Act of 1965 (20 U.S.C. 1098e(b)(8)) is amended to
read as follows:
``(8) a borrower who is repaying a loan made, insured, or
guaranteed under part B or D pursuant to income-based repayment
may elect, at any time, to terminate repayment pursuant to
income-based repayment and repay such loan under any repayment
plan for which the loan is eligible in accordance with the
requirements of part B or part D, respectively; and''.
(b) Effective Date; Application.--
(1) Automatic enrollment.--The amendments made by
paragraphs (1) and (2) of subsection (a) shall--
(A) take effect as soon as the Secretary of
Education determines practicable, but not later than 2
years after the date of enactment of this Act; and
(B) apply to all borrowers of covered loans (as
defined in section 455(d)(8) of the Higher Education
Act of 1965, as added by subsection (a)).
(2) Changing plans.--The amendment made by subsection
(a)(3) shall take effect on the date of enactment of this Act.
SEC. 4. AUTOMATIC RECERTIFICATION OF INCOME.
(a) Income Contingent Repayment.--Section 455(e) of the Higher
Education Act of 1965 (20 U.S.C. 1087e(e)) is amended--
(1) in paragraph (3)--
(A) by striking ``does not reasonably reflect the
borrower's current income'' and inserting ``whose
income has decreased relative to the adjusted gross
income available to the Secretary''; and
(B) by inserting ``, consistent with the procedures
established under paragraph (8)(B)(iv)'' before the
period at the end; and
(2) by adding at the end the following:
``(8) Automatic recertification.--
``(A) Definition.--In this paragraph, the term
`covered loan' has the meaning given the term in
subsection (d)(8).
``(B) In general.--Beginning as soon as the
Secretary determines practicable, but not later than 2
years after the date of enactment of the Streamlining
Income-driven, Manageable Payments on Loans for
Education Act, the Secretary shall, with respect to any
borrower described in subparagraph (C)--
``(i) offer an opportunity for such
borrower to opt out of clause (ii) and prevent
the Secretary from obtaining information under
such clause;
``(ii) submit a written request to the
Secretary of the Treasury under section
6103(l)(13) of the Internal Revenue Code of
1986 for disclosure of information relating to
income, tax filing status, and number of
dependents of such borrower (and such
borrower's spouse, if applicable) for purposes
of determining the repayment obligation of the
borrower for such year; and
``(iii) provide the borrower with an
opportunity to update the information obtained
under clause (ii) before the determination of
the annual repayment obligation of the
borrower.
``(C) Applicability.--Subparagraph (B) shall apply
to each borrower of a covered loan who--
``(i) selects, or for whom the Secretary
selects under subparagraph (C) or (D) of
paragraph (6) or paragraph (7)(C) of subsection
(d), or section 428(m)(1), an income contingent
repayment plan; or
``(ii) recertifies income and family size
under such plan.
``(D) Borrower for whom adjusted gross income is
unavailable.--In the case of a borrower for whom
information is unavailable under subparagraph (B)--
``(i) if the borrower has selected to repay
the covered loans of such borrower pursuant to
an income contingent repayment plan that
defines discretionary income in such a manner
that an individual not required under section
6012(a)(1) of the Internal Revenue Code of 1986
to file a return with respect to income taxes
imposed by subtitle A of such Code may have a
calculated monthly payment greater than $0, the
borrower will be required to provide the
Secretary with other documentation of income
satisfactory to the Secretary, which
documentation the Secretary may use to
determine an appropriate repayment schedule; or
``(ii) if the borrower has selected to
repay such loans pursuant to an income
contingent repayment that is not described in
clause (i), the borrower will not be required
to provide the Secretary with such other
documentation of income, and the borrower will
have a calculated monthly payment of $0.
``(E) Other requirements.--The Secretary's actions
under this paragraph shall be consistent with the
requirements of paragraphs (1) through (7), except as
otherwise provided in this paragraph.''.
(b) Income-Based Repayment.--Section 493C(c) of the Higher
Education Act of 1965 (20 U.S.C. 1098e(c)) is amended--
(1) by striking ``The Secretary shall establish'' and
inserting the following:
``(1) In general.--The Secretary shall establish'';
(2) by striking ``The Secretary shall consider'' and
inserting the following:
``(2) Procedures for eligibility.--The Secretary shall--
``(A) consider''; and
(3) by striking ``428C(b)(1)(E).'' and inserting the
following: ``428C(b)(1)(E); and
``(B) beginning as soon as the Secretary determines
practicable, carry out, with respect to borrowers of
any covered loan (as defined in section 455(d)(8)),
procedures for income-based repayment plans that are
equivalent to the procedures carried out under section
455(e)(8) with respect to income contingent repayment
plans.''.
SEC. 5. DISCLOSURE OF TAX RETURN INFORMATION TO CARRY OUT CERTAIN
HIGHER EDUCATION LOAN PROGRAMS.
(a) In General.--Paragraph (13) of section 6103(l) of the Internal
Revenue Code of 1986 is amended to read as follows:
``(13) Disclosure of returns and return information for
purposes of student loan administration.--
``(A) In general.--The Secretary shall, subject to
such requirements and conditions as the Secretary may
prescribe, upon written request from the Secretary of
Education under section 437(a), section 455(d), or
section 455(e) of the Higher Education Act of 1965,
disclose to officers and employees of the Department of
Education returns and return information with respect
to a taxpayer described in such section.
``(B) Restriction on use of disclosed
information.--Return information disclosed under
subparagraph (A) may be used by officers and employees
of the Department of Education only for the purposes
of, and to the extent necessary for purposes of--
``(i) carrying out income monitoring under
section 437(a) of the Higher Education Act of
1965,
``(ii) establishing the appropriate
repayment amount under an applicable income-
driven repayment plan (as defined in section
455(d)(8) of such Act) in connection with an
applicable student loan for--
``(I) borrowers who have selected
such a plan, and
``(II) in the case of any
recertification under section 455(e)(8)
or 493C(c)(2)(B) of the Higher
Education Act of 1965, borrowers who
are enrolled in such a plan,
``(iii) in the case of borrowers who are at
least 60 days delinquent on an applicable
student loan--
``(I) providing notice of
eligibility for an income-driven
repayment plan (as so defined) pursuant
to section 455(d)(6)(B) of the Higher
Education Act of 1965, and
``(II) automatic enrollment in such
an income-driven repayment plan after
such borrowers are at least 120 days
delinquent on such a loan pursuant to
section 455(d)(6)(C) of such Act, and
``(iv) in the case of borrowers who are
rehabilitating defaulted loans, providing
notice of eligibility for an income-driven
repayment plan (as so defined) and automatic
enrollment in such a plan pursuant to section
455(d)(7) of the Higher Education Act of 1965.
``(C) Disclosure to certain contractors.--Officers
and employees of the Department of Education may
disclose the information described in subparagraph (A)
to persons awarded contracts by the Secretary of
Education under section 456 of the Higher Education Act
of 1965 to the extent necessary for the purposes
described in subparagraph (B).
``(D) Spousal information for married individuals
filing separate returns.--For purposes of this
paragraph, in the case of a married individual filing a
separate return, the term `taxpayer' includes the
spouse of that individual if the Secretary of Education
requests information from the spouse of that individual
and the individual and the spouse have consented in
writing.''.
(b) Conforming Amendments.--
(1) Section 6103(a)(3) of such Code is amended by inserting
``(13),'' after ``(12),''.
(2) Section 6103(p)(4) of such Code is amended by inserting
``(13),'' after ``(l)(10),'' each place it occurs.
(c) Effective Date.--The amendments made by this section shall
apply to disclosures made after the date of enactment of this Act.
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