[Congressional Bills 117th Congress]
[From the U.S. Government Publishing Office]
[H.R. 7727 Introduced in House (IH)]

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117th CONGRESS
  2d Session
                                H. R. 7727

To amend the Higher Education Act of 1965 to require that institutions 
 of higher education maintain certain adjusted cohort default rates to 
   participate in programs under title IV of such Act, and for other 
                               purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                              May 11, 2022

  Ms. Porter 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 require that institutions 
 of higher education maintain certain adjusted cohort default rates to 
   participate in programs under title IV of such Act, 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 ``Accountability in Student Loan Data 
Act of 2022''.

SEC. 2. PROGRESS PERIOD STATUS.

    Section 103 of the Higher Education Act of 1965 (20 U.S.C. 1003) is 
amended--
            (1) by redesignating paragraphs (14) through (24) as 
        paragraphs (15) through (25), respectively; and
            (2) by inserting after paragraph (13) the following:
            ``(14) Progress period status.--The term `progress period 
        status' means the status of an institution of higher education 
        that is determined by the Secretary to be in danger of failing 
        to meet title IV eligibility criteria relating to student debt 
        because the institution has an adjusted cohort default rate of 
        not less than 10 percent and not more than 15 percent.''.

SEC. 3. CONSUMER INFORMATION.

    Section 132 of the Higher Education Act of 1965 (20 U.S.C. 1015a) 
is amended in subsection (i)(1)(T), by striking ``rate,'' and inserting 
``rate and adjusted cohort default rate,''.

SEC. 4. FEDERAL PELL GRANTS.

    (a) Higher Education Act.--Section 401(j) of the Higher Education 
Act of 1965 (20 U.S.C. 1070a(j)) is amended--
            (1) in paragraph (1), by inserting before the period the 
        following: ``, or if such institution of higher education is 
        subject to an ineligibility determination under section 
        435(a)(9)''; and
            (2) in paragraph (2), by inserting ``, final adjusted 
        cohort default rate, or on-time repayment rate,'' before 
        ``determination''.
    (b) FAFSA Simplification Act.--
            (1) Amendment.--Section 401(j) of the Higher Education Act 
        of 1965 (20 U.S.C. 1070a(j)), as amended by section 703 of the 
        FAFSA Simplification Act (title VII of division FF of Public 
        Law 116-260), is amended--
                    (A) in paragraph (1), by inserting before the 
                period the following: ``, or if such institution of 
                higher education is subject to an ineligibility 
                determination under section 435(a)(9)''; and
                    (B) in paragraph (2), by inserting ``, final 
                adjusted cohort default rate, or on-time repayment 
                rate,'' before ``determination''.
            (2) Effective date.--The amendment made by paragraph (1) 
        shall take effect as if included in section 703 of the FAFSA 
        Simplification Act (title VII of division FF of Public Law 116-
        260) on the date of enactment of such Act.

SEC. 5. DISBURSEMENT OF STUDENT LOANS.

    Section 428G of the Higher Education Act of 1965 (20 U.S.C. 1078-
7(a)) is amended--
            (1) in subsection (a), by adding at the end the following:
            ``(5) Adjusted cohort default rate.--Beginning on the date 
        on which the final adjusted cohort default rates are published 
        by the Secretary for not less than 3 fiscal years under section 
        435(m), an institution whose adjusted cohort default rate (as 
        determined under section 435(m)) for each of the 3 most recent 
        fiscal years for which data are available is less than 5 
        percent may disburse any loan made, insured, or guaranteed 
        under this part in a single installment for any period of 
        enrollment that is not more than 1 semester, 1 trimester, 1 
        quarter, or 4 months.''; and
            (2) in subsection (e), by inserting before the period the 
        following: ``or, beginning on the date on which the final 
        adjusted cohort default rates are published by the Secretary 
        for fiscal year 2021 under section 435(m), an adjusted cohort 
        default rate (as determined under section 435(m)) of less than 
        2 percent''.

SEC. 6. COHORT DEFAULT RATES.

    (a) Ineligibility Based on High Default Rates.--
            (1) In general.--Section 435(a) of the Higher Education Act 
        of 1965 (20 U.S.C. 1085(a)) is amended--
                    (A) in paragraph (7)(A), by adding at the end the 
                following:
                            ``(iii) Default management plan.--The 
                        default management plan required under clause 
                        (i) may not include placing students in 
                        forbearance as a means of reducing the cohort 
                        default rate or the adjusted cohort default 
                        rate of the institution.''; and
                    (B) by adding at the end the following:
            ``(9) Ineligibility based on high adjusted cohort default 
        rates.--
                    ``(A) In general.--Except as provided in 
                subparagraphs (B) and (D), beginning on the date that 
                is one year after the date on which the final adjusted 
                cohort default rates are published by the Secretary for 
                not less than 3 fiscal years, in a case in which one of 
                the following determinations is made with respect to an 
                institution, such institution shall be ineligible to 
                participate in a program under this title for the 
                fiscal year for which the determination is made and for 
                the two succeeding fiscal years:
                            ``(i) The institution's adjusted cohort 
                        default rate is greater than 20 percent for 
                        each of the three most recent fiscal years for 
                        which the final adjusted cohort default rates 
                        are published.
                            ``(ii) With respect to the six most recent 
                        fiscal years for which the final adjusted 
                        cohort default rates are published--
                                    ``(I) the institution's adjusted 
                                cohort default rate is greater than 15 
                                percent for each such fiscal year; and
                                    ``(II) the Secretary determines 
                                that, during such 6-year period, the 
                                institution has not made adequate 
                                progress in meeting standards for 
                                student achievement established by the 
                                relevant accrediting agency or 
                                association pursuant to section 
                                496(a)(5)(A).
                            ``(iii) With respect to the eight most 
                        recent fiscal years for which the final 
                        adjusted cohort default rates are published--
                                    ``(I) the institution's adjusted 
                                cohort default rate is greater than 10 
                                percent for each such fiscal year; and
                                    ``(II) the Secretary determines 
                                that, during such 8-year period, the 
                                institution has not made adequate 
                                progress in meeting standards for 
                                student achievement established by the 
                                relevant accrediting agency or 
                                association pursuant to section 
                                496(a)(5)(A).
                    ``(B) Exceptions for certain categories of 
                educational programs.--With respect to an institution 
                that loses eligibility to participate in a program 
                under this title in accordance with subparagraph 
                (A)(ii), such institution may request and be granted an 
                exception to such loss of eligibility for a category of 
                educational programs at such institution by 
                demonstrating to the Secretary that the adjusted cohort 
                default rate for the category of educational programs 
                is 15 percent or less for each fiscal year of the 6-
                year period on which such loss of eligibility for the 
                institution is based.
                    ``(C) Determination of the adjusted cohort rate for 
                a category of educational programs.--In determining the 
                adjusted cohort default rate for a category of 
                educational programs for purposes of this paragraph--
                            ``(i) subsection (m) shall be applied--
                                    ``(I) in paragraph (1)--
                                            ``(aa) in subparagraph (A), 
                                        by substituting `received for 
                                        enrollment in the category of 
                                        educational programs for which 
                                        such rate is being determined' 
                                        for `received for attendance at 
                                        the institution'; and
                                            ``(bb) in subparagraph 
                                        (E)(i)(II), by substituting, 
                                        `percentage of students 
                                        enrolled in the category of 
                                        educational programs for which 
                                        such rate is being determined' 
                                        for `percentage of students 
                                        enrolled at the institution'; 
                                        and
                                    ``(II) as if the following were 
                                added at the end of paragraph (2):
                    ```(E) In the case of a student who has received a 
                loan for enrollment in more than one category of 
                educational programs, the student (and such student's 
                subsequent repayment or default) is attributed to the 
                last category of educational programs in which such 
                student was enrolled.'.
                    ``(D) Transition exception.--
                            ``(i) In general.--A covered institution 
                        with an adjusted cohort default rate that is 
                        greater than 20 percent for the first fiscal 
                        year for which such rates are published by the 
                        Secretary may request that any determination of 
                        such covered institution's ineligibility under 
                        subparagraph (A) not be based on the adjusted 
                        cohort default rate of such covered institution 
                        for any or all of the first 3 fiscal years for 
                        which such rates are published by the 
                        Secretary.
                            ``(ii) Requirement.--To be granted a 
                        request under clause (i), a covered institution 
                        shall submit to the Secretary a default 
                        management plan as specified in paragraph (7).
                            ``(iii) Definition of covered 
                        institution.--In this subparagraph, the term 
                        `covered institution' means--
                                    ``(I) a public institution of 
                                higher education;
                                    ``(II) a part B institution (as 
                                defined in section 322); or
                                    ``(III) a private, nonprofit 
                                institution of higher education at 
                                which not less than 45 percent of the 
                                total student enrollment consists of 
                                low-income students (as such term is 
                                defined in section 419N(b)(7)).
                    ``(E) Category of educational programs defined.--
                The term `category of educational programs', when used 
                with respect to an institution, means one of the 
                following:
                            ``(i) The educational programs at the 
                        institution leading to an undergraduate, non-
                        degree credential.
                            ``(ii) The educational programs at the 
                        institution leading to an associate's degree.
                            ``(iii) The educational programs at the 
                        institution leading to a bachelor's degree.
                            ``(iv) The educational programs at the 
                        institution leading to a graduate, non-degree 
                        credential.
                            ``(v) The educational program at the 
                        institution leading to a graduate degree.
            ``(10) Application of adjusted cohort default rate.--
        Beginning on the date on which the final adjusted cohort 
        default rates are published by the Secretary for not less than 
        3 fiscal years--
                    ``(A) paragraph (1) shall be applied by 
                substituting `paragraph (9)' for `paragraph (2)';
                    ``(B) paragraph (3) shall be applied by 
                substituting `adjusted cohort default rate, calculated 
                in accordance with subsection (m)(1)(D), is greater 
                than 20 percent for any 3 consecutive fiscal years' for 
                `cohort default rate, calculated in accordance with 
                subsection (m), is equal to or greater than the 
                threshold percentage specified in paragraph (2)(B)(iv) 
                for any two consecutive fiscal years';
                    ``(C) paragraph (4) shall be applied--
                            ``(i) in subparagraph (C), by substituting 
                        `adjusted cohort default rate is greater than 
                        15 percent' for `cohort default rate equals or 
                        exceeds 20 percent'; and
                            ``(ii) in the matter following subparagraph 
                        (C), by substituting `adjusted cohort default 
                        rate to reflect the percentage of defaulted 
                        loans in the representative sample that are 
                        required to be excluded pursuant to subsection 
                        (m)(1)(B)' for `cohort default rate to reflect 
                        the percentage of defaulted loans in the 
                        representative sample that are required to be 
                        excluded pursuant to subsection (m)(1)(B)';
                    ``(D) paragraph (5)(A) shall be applied by 
                substituting `paragraph (9)' for `paragraph (2)'; and
                    ``(E) paragraph (7) shall be applied--
                            ``(i) in subparagraph (A)(i)--
                                    ``(I) in the matter preceding 
                                subclause (I), by substituting 
                                `adjusted cohort default rate is 
                                greater than 20 percent' for `cohort 
                                default rate is equal to or greater 
                                than the threshold percentage specified 
                                in paragraph (2)(B)(iv)'; and
                                    ``(II) in subclauses (I) and (II), 
                                by substituting `adjusted cohort 
                                default rate' for `cohort default 
                                rate'; and
                            ``(ii) in subparagraph (B)(i), by 
                        substituting `adjusted cohort default rate is 
                        greater than 20 percent' for `cohort default 
                        rate is equal to or greater than the threshold 
                        percentage specified in paragraph 
                        (2)(B)(iv)'.''.
            (2) Conforming amendments.--Section 435(a)(2) of the Higher 
        Education Act of 1965 (20 U.S.C. 1085(a)) is amended--
                    (A) in the paragraph heading, by adding at the end 
                the following: ``before fiscal year 2021''; and
                    (B) in subparagraph (B)(iv), by striking ``and any 
                succeeding fiscal year'' and inserting ``through fiscal 
                year 2020''.
    (b) Adjusted Cohort Default Rate Defined.--Section 435(m)(1) of the 
Higher Education Act of 1965 (20 U.S.C. 1085(m)(1)) is amended by 
adding at the end the following:
            ``(D)(i) With respect to a cohort default rate calculated 
        for an institution under this paragraph for fiscal year 2021 
        and for each succeeding fiscal year, such cohort default rate 
        shall be adjusted as follows:
                    ``(I) In determining the number of current and 
                former students at an institution who enter repayment 
                for such fiscal year--
                            ``(aa) any such student who is in 
                        nonmandatory forbearance for such fiscal year 
                        for a period of greater than 18 months but less 
                        than 36 months shall not be counted as entering 
                        repayment for such fiscal year;
                            ``(bb) such a student shall be counted as 
                        entering repayment for the first fiscal year 
                        for which the student ceases to be in a period 
                        of forbearance and otherwise meets the 
                        requirements for being in repayment; and
                            ``(cc) any such student who is in a period 
                        of forbearance for three or more years shall be 
                        counted as in default and included in the 
                        institution's total number of students in 
                        default.
                    ``(II) Such rate shall be multiplied by the 
                percentage of students enrolled at the institution for 
                such fiscal year who are borrowing a loan under part D 
                of this title.
            ``(ii) The result obtained under this subparagraph for an 
        institution shall be referred to in this Act as the `adjusted 
        cohort default rate'.''.
    (c) Publication of Adjusted Cohort Default Rate.--Section 435(m) of 
the Higher Education Act of 1965 (20 U.S.C. 1085(m)) is further amended 
by adding at the end the following:
            ``(5) Beginning on the date on which the final adjusted 
        cohort default rates for fiscal year 2021 are made available 
        for publication by the Secretary, paragraph (4) shall be 
        applied by substituting `adjusted cohort default' for `cohort 
        default' each place it appears.''.

SEC. 7. ADJUSTED COHORT DEFAULT RATE.

    Section 487(a)(14) of the Higher Education Act of 1965 is amended 
by adding at the end the following:
                    ``(D) Beginning on the date on which the final 
                adjusted cohort default rates are published by the 
                Secretary for fiscal year 2021 under section 435(m), 
                subparagraph (C) shall be applied by substituting 
                `adjusted cohort default rate in excess of 5 percent' 
                for `cohort default rate in excess of 10 percent' each 
                place it appears.''.

SEC. 8. PROGRAM REVIEW AND DATA.

    Section 498A of the Higher Education Act of 1965 (20 U.S.C. 1099c-
1) is amended in subsection (a)(2), by striking subparagraph (A) and 
inserting the following:
                    ``(A) institutions with an adjusted cohort default 
                rate for loans under part D of this title in excess of 
                18 percent or which places such institutions in the 
                highest 25 percent of such institutions;''.

SEC. 9. ASSISTANCE TO PROGRESS PERIOD INSTITUTIONS.

    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:

``SEC. 498C. ASSISTANCE TO PROGRESS PERIOD INSTITUTIONS.

    ``(a) In General.--The Secretary shall provide grants and technical 
assistance to covered progress period institutions in accordance with 
this section.
    ``(b) Authorized Activities.--Grants and assistance provided under 
this section shall be used to improve student achievement (as described 
in section 496(a)(5)(A)) at covered progress period institutions.
    ``(c) Duration.--Grants and assistance may be provided under this 
section for a period of not less than one year and not more than three 
years.
    ``(d) Conditions.--
            ``(1) Benchmarks.--
                    ``(A) In general.--To continue to receive support 
                under this section after the first year in which such 
                support is provided, an institution must show progress, 
                as determined by the Secretary, toward meeting the 
                standards for student achievement established by the 
                relevant accrediting agency or association pursuant to 
                section 496(a)(5)(A).
                    ``(B) Considerations.--In determining the progress 
                of an institution under subparagraph (A), the Secretary 
                may take into consideration extenuating circumstances 
                that may have contributed to the poor performance of 
                the institution in the first year of the review period.
            ``(2) Deadline for compliance.--An institution that does 
        not achieve an adjusted cohort default rate of less than 10 
        percent after receiving support under this section for three 
        consecutive years shall be ineligible to receive further 
        support under this section.
            ``(3) Prohibition.--An institution shall be ineligible to 
        receive further support under this section if, while the 
        institution was receiving such support, the total enrollment of 
        low-income students (as such term is defined in section 
        419N(b)(7)) at the institution decreased by 10 percent or more.
    ``(e) Covered Progress Period Institution.--In this section, the 
term `covered progress period institution' means--
            ``(1) a public institution of higher education that is 
        determined to be in progress period status;
            ``(2) a part B institution (as defined in section 322) that 
        is determined to be in progress period status; or
            ``(3) a private, nonprofit institution of higher 
        education--
                    ``(A) that is determined to be in progress period 
                status; and
                    ``(B) at which not less than 45 percent of the 
                total student enrollment consists of low-income 
                students (as such term is defined in section 
                419N(b)(7)).
    ``(f) Funding.--
            ``(1) In general.--There are appropriated such funds as the 
        Secretary, using the formula described in paragraph (2), 
        determines necessary to meet the needs of all eligible 
        institutions under this subsection.
            ``(2) Formula.--Not later than 1 year after the date of the 
        enactment of this section, the Secretary shall establish 
        through negotiated rulemaking a formula to determine the--
                    ``(A) proportional amount of institutional need 
                under this section; and
                    ``(B) total amount of institutional need under this 
                section.
            ``(3) Special rule.--Such formula must at minimum take into 
        consideration the severity of the problem, size of the 
        institution, institutional resources, historical underfunding, 
        and the number of low-income students (as such term is defined 
        in section 419N(b)(7)) being served.''.
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