[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4098 Introduced in House (IH)]
<DOC>
116th CONGRESS
1st Session
H. R. 4098
To amend the Higher Education Act of 1965 to provide for accreditation
reform, to require institutions of higher education to publish
information regarding student success, to provide for fiscal
accountability, and to provide for school accountability for student
loans.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
July 30, 2019
Mr. Rooney of Florida (for himself, Mr. Ratcliffe, and Mr. Budd)
introduced the following bill; which was referred to the Committee on
Education and Labor
_______________________________________________________________________
A BILL
To amend the Higher Education Act of 1965 to provide for accreditation
reform, to require institutions of higher education to publish
information regarding student success, to provide for fiscal
accountability, and to provide for school accountability for student
loans.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Higher Education Reform and
Opportunity Act of 2019''.
TITLE I--ACCREDITATION REFORM
SEC. 101. ACCREDITATION REFORM.
(a) Definition of Institution of Higher Education.--Section
102(a)(1) of the Higher Education Act of 1965 (20 U.S.C. 1002(a)(1)) is
amended--
(1) by redesignating subparagraphs (B) and (C) as
subparagraphs (C) and (D), respectively; and
(2) by inserting after subparagraph (A) the following:
``(B) if accredited by an authorized accreditation
authority in a State that has an alternative
accreditation agreement with the Secretary, as
described in section 498C--
``(i) an institution that provides
postsecondary education;
``(ii) a postsecondary apprenticeship
program; or
``(iii) a postsecondary education course or
program provided by an institution of
postsecondary education, a nonprofit
organization, or a for-profit organization or
business;''.
(b) State Alternative Accreditation.--Part H of title IV of the
Higher Education Act of 1965 (20 U.S.C. 1099a et seq.) is amended by
adding at the end the following:
``Subpart 4--State Alternative Accreditation
``SEC. 498C. STATE ALTERNATIVE ACCREDITATION.
``(a) In General.--Notwithstanding any other provision of law, a
State may establish an alternative accreditation system for the purpose
of establishing institutions that provide postsecondary education and
postsecondary education courses or programs as eligible for funding
under title IV if the State submits a plan to the Secretary for the
establishment of the alternative accreditation system. Such
institutions, courses, or programs may include--
``(1) institutions that provide postsecondary education
that culminates in a certification, credential, or degree;
``(2) postsecondary apprenticeship programs that culminate
in a certification, credential, or degree;
``(3) any other postsecondary education course or program
offered at an institution of postsecondary education, a
nonprofit organization, or a for-profit organization or
business, that culminates in a certification, credential, or
degree; and
``(4) any of the entities described in paragraphs (1)
through (3) that do not award a postsecondary certification,
credential, or degree, provided that such entity provides
credit that will be accepted toward a postsecondary
certification, credential, or degree at one or more of the
entities described in paragraphs (1) through (3).
``(b) Alternative Accreditation Notification.--The alternative
accreditation plan described in subsection (a) shall include the
following:
``(1) The State's plan for designating one or more
authorized accrediting entities within the State, such as the
State Department of Education, another State agency, an
industry-specific accrediting agency, or another entity, and an
explanation of the process through which the State will select
such authorized accrediting entities.
``(2) The standards or criteria that an institution that
provides postsecondary education and a postsecondary education
course or program must meet in order to--
``(A) receive an initial accreditation as part of
the alternative accreditation system; and
``(B) maintain such accreditation.
``(3) A description of the appeals process through which an
institution that provides postsecondary education or a
postsecondary education course or program may appeal to an
authorized accrediting entity if such institution, course, or
program is denied accreditation under the State alternative
accreditation system.
``(4) Any State policy regarding public accessibility to
certain information relating to institutions that provide
postsecondary education and postsecondary education courses and
programs accredited under the State alternative accreditation
system, including--
``(A) the information described in subsection
(e)(1); and
``(B) information about the rates of job placement
for individuals that have graduated from an institution
or completed a course or program that is accredited
under the State alternative accreditation system, if
available.
``(5) An assurance by the State that under the State
alternative accreditation system, only institutions that
provide postsecondary education and postsecondary education
courses or programs that provide a postsecondary certification,
credential, or degree, or credits toward a postsecondary
certification, credential, or degree (as defined by the State
in accordance with paragraph (6)) will be accredited.
``(6) The State's definition of a postsecondary
certification, credential, or degree, as such term applies to
the requirement described in paragraph (5).
``(7) A description of the agreements that the State will
enter into with institutions that provide postsecondary
education and postsecondary education courses or programs that
are accredited under the alternative accreditation system for
purposes of accreditation regarding requirements for
instructional time, in lieu of the requirements described under
section 481(a)(2).
``(8) A description of the agreements that the State will
enter into with institutions that provide postsecondary
education and postsecondary education courses or programs that
are accredited under the alternative accreditation system
regarding requirements for credit hours or clock hours, or
other measures of student learning, in lieu of the requirements
described under section 481(b).
``(c) Review and Approval.--Not later than 30 days after the
Secretary receives a plan from a State regarding an alternative
accreditation system, the Secretary shall submit to the State and
Congress, and make publicly available, a response to the State's plan.
The Secretary shall approve the plan and allow the State to establish
the alternative accreditation system if the plan meets the requirements
described in subsection (b).
``(d) Time Limit.--Each plan approved under subsection (c) shall
allow a State to carry out an alternative accreditation system in the
State for a period of 5 years.
``(e) Reporting Requirements.--States that establish an alternative
accreditation system shall submit a report to the Secretary every 3
years following the implementation of the alternative accreditation
system. The report shall include--
``(1) in the case of a postsecondary education course or
program that is accredited through the State alternative
accreditation system--
``(A) the number and percentage of students who
successfully complete each such postsecondary education
course or program; and
``(B) for postsecondary education courses or
programs that lead to a certification, credential, or
degree, the number of students in such course or
program; and
``(2) in the case of an institution that provides
postsecondary education that is accredited through the State
alternative accreditation system--
``(A) the number and percentage of students who
successfully obtain a postsecondary certification,
credential, or degree from such institution; and
``(B) the number and percentage of students who do
not successfully obtain a postsecondary certification,
credential, or degree from such institution but do
obtain credit from such institution toward a
postsecondary degree, credential, or certification; and
``(3) a description of any requirements for third-party
verification of information contained in the report.''.
(c) Title IV Eligibility Requirements.--Part G of title IV of the
Higher Education Act of 1965 (20 U.S.C. 1088 et seq.) is amended by
adding at the end the following:
``SEC. 493E. STATE ACCREDITED INSTITUTIONS, PROGRAMS, OR COURSES.
``Notwithstanding any other provision of law, an institution,
program, or course that is eligible for funds under this title in
accordance with section 102(a)(1)(B) and meets the requirements of
section 498C--
``(1) shall not be required to meet the requirements of
section 496; and
``(2) shall not be required to meet the requirements
described in subsections (a)(2) and (b) of section 481.''.
TITLE II--TRANSPARENCY IN HIGHER EDUCATION
SEC. 201. TIME FOR TRANSPARENCY IN HIGHER EDUCATION.
(a) In General.--Title IV of the Higher Education Act of 1965 (20
U.S.C. 1070 et seq.) is amended--
(1) in section 487(a), by adding at the end the following:
``(30) The institution will publish information in
compliance with section 493E.''; and
(2) in part G, by adding at the end the following:
``SEC. 493E. INSTITUTIONAL PUBLICATION OF INFORMATION.
``(a) Publication of Information.--
``(1) In general.--Each institution of higher education
participating in a program under this title shall publish on
the institution's website and in an alternative format, on an
annual basis, the information described in paragraphs (2) and
(3). To the extent that such data is available, an institution
may use data that the institution is already collecting in
accordance with other Federal requirements.
``(2) Information.--Each institution of higher education
described in paragraph (1) shall publish, with respect to the
institution as a whole and with respect to each program of
study offered by the institution, the following information for
the most recent fiscal year for which the information is
available:
``(A) For each of the following, the percentage and
number of students enrolled at the institution or in
the program of study, as applicable, who receive the
following:
``(i) Federal grant aid, including Federal
Pell Grants under subpart 1 of part A, Federal
Supplemental Educational Opportunity Grants
under subpart 3 of part A, or any other Federal
postsecondary education grant aid or subsidy.
``(ii) Federal student loans, including
Federal loans under part D.
``(iii) State grant aid.
``(iv) Institutional grants.
``(v) A student loan from a State.
``(B) Student body enrollment status, including as
a--
``(i) first-time, full-time student;
``(ii) first-time, part-time student;
``(iii) non-first-time, full-time student;
and
``(iv) non-first-time, part-time student.
``(C) Information about students that includes the
following:
``(i) The percentage of students who do not
complete the program of study the student
initially started upon enrollment.
``(ii) The percentage of students who
transfer.
``(iii) The percentage of students who
complete the program of study the student
initially started upon enrollment.
``(iv) The average length of time for a
student to complete the program of study.
``(v) The percentage of students who
continue on to higher levels of education.
``(vi) The percentage of former students
who received financial aid who are employed at
2, 4, and 6 years after graduating,
disaggregated by program of study.
``(vii) The median earnings of former
students who earned a degree or credential and
received financial aid on the date that is 10
years after the date the students first
enrolled in a program of study at the
institution, disaggregated by program of study.
``(viii) The median earnings of former
students who received financial aid on the date
that is 10 years after the date the students
first enrolled in a program of study at the
institution, disaggregated by program of study.
``(3) Publication of default and non-repayment rates.--In
addition to the information described in paragraph (2), each
institution of higher education described in paragraph (1)
shall publish, with respect to the institution as a whole and
with respect to each program of study offered by the
institution, the following information for the most recent
fiscal year for which the information is available:
``(A) The average amount of total Federal student
loan debt accrued upon graduation.
``(B) The average amount of total Federal student
loan debt accrued by students who leave the institution
without having graduated.
``(C) Federal student loan default rate.
``(D) Federal student loan non-repayment rate.
``(E) Default and non-repayment rate, including as
a--
``(i) first-time, full-time student;
``(ii) first-time, part-time student;
``(iii) non-first-time, full-time student;
and
``(iv) non-first-time, part-time student.
``(F) Default and non-repayment rate, of--
``(i) students who complete a program of
study;
``(ii) students who transfer; and
``(iii) students who do not complete a
program of study.
``(b) Privacy.--
``(1) Compliance with ferpa.--In carrying out this section,
an institution of higher education and any personnel of the
institution shall not share any personally identifiable
information and shall act in accordance with section 444 of the
General Education Provisions Act (20 U.S.C. 1232g, commonly
known as the `Family Educational Rights and Privacy Act of
1974').
``(2) Prohibition on use of information.--Information
published pursuant to this section shall not be used by a
Federal employee, agency, or officer, or an institution of
higher education to take action against an individual.
``(3) Penalties.--The Secretary shall establish penalties
for a violation of paragraph (1) or (2) that includes both a
monetary fine and up to 5 years in prison.
``(c) Rule of Construction.--Nothing in this section shall be
construed to authorize or permit the Secretary or any employee or
contractor of the Department to mandate, direct, or control the
selection of practices or curriculum by an institution of higher
education.''.
(b) GAO Report.--
(1) Study.--The Comptroller General of the United States
shall conduct a study that compiles all the institutional
publication of information pursuant to section 493E of the
Higher Education Act of 1965, as added by subsection (a) of
this Act.
(2) Report.--Not later than October 1 of the fourth fiscal
year after the date of enactment of this Act, the Comptroller
General of the United States shall submit a report containing
the results of the study under paragraph (1) to the appropriate
committees of Congress.
TITLE III--FISCAL ACCOUNTABILITY
SEC. 301. SIMPLIFICATION OF FEDERAL STUDENT LOANS.
(a) Termination.--Section 451 of the Higher Education Act of 1965
(20 U.S.C. 1087a) is amended--
(1) in subsection (a), by adding at the end the following:
``No sums may be expended after September 30, 2026, with
respect to loans under this part for which the first
disbursement is after such date, except Federal Direct
simplification loans under section 460A.''; and
(2) by adding at the end, the following:
``(c) Termination of Authority To Make New Loans.--Notwithstanding
subsection (a) or any other provision of law--
``(1) no new loans may be made under this part after
September 30, 2026, except Federal Direct simplification loans
under section 460A; and
``(2) no funds are authorized to be appropriated, or may be
expended, under this Act, or any other Act to make loans under
this part for which the first disbursement is after September
30, 2026, except Federal Direct simplification loans under
section 460A, or as expressly authorized by an Act of Congress
enacted after the date of enactment of Higher Education Reform
and Opportunity Act of 2019.
``(d) Student Eligibility Beginning With Award Year 2022.--
``(1) New borrowers.--No loan may be made under this part
to a new borrower for which the first disbursement is after
June 30, 2022, except Federal Direct simplification loans under
section 460A.
``(2) Borrowers with outstanding balances.--Subject to
paragraph (3), with respect to a borrower who, as of July 1,
2022, has an outstanding balance of principal or interest owing
on a loan made under this part that is not a Federal Direct
simplification loan under section 460A, such borrower may--
``(A) in the case of such a loan made to the
borrower for enrollment in a program of undergraduate
education, borrow loans made under this part that are
not Federal Direct simplification loans under section
460A for any program of undergraduate education through
the close of September 30, 2026;
``(B) in the case of such a loan made to the
borrower for enrollment in a program of graduate or
professional education, borrow loans made under this
part that are not Federal Direct simplification loans
under section 460A for any program of graduate or
professional education through the close of September
30, 2026; and
``(C) in the case of such a loan made to the
borrower on behalf of a dependent student for the
student's enrollment in a program of undergraduate
education, borrow loans made under this part that are
not Federal Direct simplification loans under section
460A on behalf of such student through the close of
September 30, 2026.
``(3) Loss of eligibility.--A borrower described in
paragraph (2) who borrows a Federal Direct simplification loan
made under section 460A for which the first disbursement is
made before September 30, 2026, shall lose the borrower's
eligibility to borrow a loan under this part that is not a
Federal Direct simplification loan under section 460A in
accordance with paragraph (2).''.
(b) Federal Direct Simplification Loans.--Part D of title IV of the
Higher Education Act of 1965 (20 U.S.C. 1087a et seq.) is amended by
adding at the end the following:
``SEC. 460A. FEDERAL DIRECT SIMPLIFICATION LOANS.
``(a) In General.--Beginning on July 1, 2022, except as provided in
section 451(d), the Secretary shall make loans to borrowers under this
section. Loans made under this section shall be known as Federal Direct
simplification loans.
``(b) Federal Direct Simplification Loans.--The provisions of this
part shall apply with respect to Federal Direct simplification loans,
except that Federal Direct simplification loans shall be made in
accordance with the following:
``(1) The applicable rate of interest on a loan made under
this section shall, for loans disbursed during any 12-month
period beginning on July 1 and ending on June 30, be determined
on the preceding June 1 and be equal to--
``(A) a rate equal to the high yield of the 10-year
Treasury note auctioned at the final auction held prior
to such June 1; plus
``(B) 3.6 percent.
``(2) Interest on a loan made under this section shall
begin to accrue on the date the loan is disbursed.
``(3) The maximum--
``(A) annual amount of loans under this section an
undergraduate student may borrow in any academic year
(as defined in section 481(a)(2)) or its equivalent
shall be equal to $7,500; and
``(B) aggregate amount of loans under this section
an undergraduate student may borrow shall be equal to
$30,000.
``(4) The maximum--
``(A) annual amount of loans under this section a
graduate or professional student may borrow in any
academic year (as defined in section 481(a)(2)) or its
equivalent shall be equal to $12,500; and
``(B) aggregate amount of loans under this section
a graduate or professional student may borrow shall be
equal to $50,000.
``(5) The only length of repayment--
``(A) for a loan borrowed by an undergraduate
student shall be 15 years; and
``(B) for a loan borrowed by a graduate or
professional student shall be 25 years.
``(6) Repayment on a loan made under this section shall
begin--
``(A) after 125 percent of the normal time for
completion of the program of study for which the
borrower receives the loan under this section; or
``(B) if the borrower withdraws from the program of
study before the borrower completes the program, 6
months after the date the borrower withdraws.
``(7) The Secretary shall not repay or cancel any
outstanding balance of principal or interest due on a Federal
Direct simplification loan as part of a student loan
forgiveness program, including such a program under section
455(m) and section 493C.
``(c) Authorization To Limit Loan Amounts.--An institution of
higher education that is required under State law to enroll all
eligible applicants for an academic year may limit the amount of loans
under this section that a student may borrow for such academic year to
not more than the tuition and fees at such institution for such
academic year.
``(d) Loan Fee.--The Secretary shall not charge the borrower of a
loan made under this part an origination fee.
``(e) Repayment.--A borrower of a loan made under this section may
accelerate without penalty repayment of the whole or any part of the
loan.''.
SEC. 302. PHASING OUT LOAN FORGIVENESS.
The Higher Education Act of 1965 (20 U.S.C. 1001 et seq.) is
amended--
(1) in section 455--
(A) in subsection (d)(1), in the matter preceding
subparagraph (A), by inserting ``(except a Federal
Direct simplification loan)'' after ``borrower of a
loan made under this part'';
(B) in subsection (e), by adding at the end the
following:
``(8) Federal direct simplification loans.--Income
contingent repayment shall not be available for a Federal
Direct simplification loan.''; and
(C) in subsection (m), by adding at the end the
following:
``(5) Elimination of loan forgiveness.--
``(A) In general.--Notwithstanding any other
provision of this Act and subject to subparagraph (B),
with respect to any loan made on or after July 1, 2022,
the Secretary may not cancel any outstanding balance of
principal and interest due on the loan for the borrower
of the loan pursuant to this subsection.
``(B) Loans for continuing program of study.--In
the case of a borrower whose first loan for a program
of study is made prior to July 1, 2022, the Secretary
may repay or cancel any outstanding balance of
principal and interest due on the subsequent loans for
that borrower for the same program of study pursuant to
this subsection for--
``(i) loans made during the time it takes
to complete that program of study; or
``(ii) loans made before July 1, 2026;
whichever occurs earlier.''; and
(2) in section 493C, by adding at the end the following:
``(f) Elimination of Loan Forgiveness.--
``(1) In general.--Notwithstanding any other provision of
this Act and subject to paragraph (2), with respect to any loan
made on or after July 1, 2022, the Secretary may not repay or
cancel any outstanding balance of principal and interest due on
the loan for the borrower of the loan pursuant to this section.
``(2) Loans for continuing program of study.--In the case
of a borrower whose first loan for a program of study is made
prior to July 1, 2022, the Secretary may repay or cancel any
outstanding balance of principal and interest due on the
subsequent loans for that borrower for the same program of
study pursuant to this section for--
``(A) loans made during the time it takes to
complete that program of study; or
``(B) loans made before July 1, 2026;
whichever occurs earlier.''.
TITLE IV--SCHOOL ACCOUNTABILITY FOR STUDENT LOANS
SEC. 401. SCHOOL ACCOUNTABILITY FOR STUDENT LOANS.
(a) Default Rate Fine.--Section 487 of the Higher Education Act of
1965 (20 U.S.C. 1094), as amended by section 201, is further amended--
(1) in subsection (a), by adding at the end the following:
``(31) The institution will pay a default rate fine that is
determined pursuant to subsection (k).''; and
(2) by adding at the end the following:
``(k) Default Rate Fine.--
``(1) In general.--Each institution described in paragraph
(2) shall pay to the Secretary an annual default rate fine in
accordance with this subsection.
``(2) Applicable institutions.--An institution shall pay a
default rate fine under this subsection for a fiscal year based
on the cohort default rate (as defined in section 435(m)) on
loans made under this title for such fiscal year.
``(3) Fine.--
``(A) In general.--Each institution described in
paragraph (2) shall pay a default rate fine for a
fiscal year that is equal to 10 percent of the
applicable amount determined under subparagraph (B)(i)
for such fiscal year.
``(B) Applicable amount.--
``(i) In general.--The applicable amount
for a fiscal year with respect to an
institution shall be an amount equal to the
product of the amount of loans made under this
title for such fiscal year, and the applicable
rate determined in clause (ii). If the
applicable rate is equal to or less than zero
percent then the applicable amount shall be
equal to zero.
``(ii) Applicable rate.--The applicable
rate for a fiscal year with respect to an
institution shall be the rate that is equal to
the difference between the cohort default rate
on loans made under this title (as defined in
section 435(m)) for such fiscal year and the
average rate of total unemployment in the
United States for the 3-year period covered by
that cohort default rate (as defined in section
435(m)), as determined by the Secretary of
Labor.
``(4) Credit for certain institutions.--Each institution
that is described in paragraph (2) shall receive a $400 credit
for the fiscal year for each graduate of the institution during
such fiscal year who received a Federal Pell Grant while
enrolled at the institution.
``(5) Flexibility in counsel and advice.--Notwithstanding
any other provision of the Act, the Secretary shall grant
institutions of higher education flexibility under this Act to
counsel and advise students on Federal financial aid, including
granting flexibility for institutions to award less than the
maximum amount of Federal student aid for which an individual
is eligible if the cost of tuition, room, and board at the
institution is less than such maximum amount.''.
(b) Flexibility in Counseling and Advice.--Section 485(l) of the
Higher Education Act of 1965 (20 U.S.C. 1092(l)) is amended by adding
at the end the following:
``(3) Flexibility in counseling and advice.--In addition to
the entrance counseling under paragraph (1), an eligible
institution may require any borrower, at or prior to the time
of a disbursement to the borrower of a loan made under part D,
to receive the information described in paragraph (2) with
respect to such loan, or any other financial counseling,
including financial literacy counseling.''.
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