Financial literacy award allocation program

(a)

In general

The Consumer Financial Protection Act of 2010 (12 U.S.C. 5481 et seq.) is amended by inserting after section 1037 the following:

1038.

Financial literacy award allocation program

(a)

In general

Not later than 1 year after the date of the enactment of this section, the Director shall establish award allocations for financial literacy and consumer education programs on a competitive basis to eligible entities as described in subsection (d).(b)

Application requirements

To be eligible for an award allocation under the program established under subsection (a), an eligible entity shall submit an application to the Director at such time, in such manner, and containing such information as the Director may require, including information on—(1)the curriculum and design of the financial literacy program proposed by the eligible entity, including a description of how such program meets the requirements of subsection (d);(2)expected participants in the proposed program; (3)who is expected to be employed or otherwise involved with the proposed program, including—(A)administrators;(B)consultants; and(C)financial advisors; and(4)a prospective budget for the proposed financial literacy program.(c)

Award allocation

(1)

Amounts

The Director shall determine the amount of each award allocation under the program established under subsection (a).(2)

Multiyear award allocations

The Director may not award more than 5 consecutive award allocations to an eligible entity based on a single application.(d)

Financial literacy program described

A financial literacy program described in this subsection is a program that provides the following:(1)Instruction to participants, including individuals who provide instruction with respect to financial literacy education, on one or more of the following:(A)Personal financial wellness.(B)Credit and alternatives to credit.(C)Management of student loan debt.(D)Preparation for homeownership.(E)Basic investing.(F)Financial saving, planning, and management.(G)Tax planning.(H)Personal information security.(I)Preparation for household changes, including merging assets after marriage and preparing for costs associated with children.(J)Other topics as determined by the Director.(2)An in-person instruction component that—(A)may be provided as a webinar, an in-classroom experience, or one-on-one financial coaching;(B)includes—(i)live, real-time instruction; and(ii)an opportunity for students to engage with an instructor; and(C)is not primarily comprised of self-taught instruction.(e)

Funding

(1)

In general

The Director shall, in accordance with section 1017(d), use amounts in the Consumer Financial Civil Penalty Fund to carry out this section.(2)

Amounts

To carry out this section, the Director shall use not more than—(A)in fiscal year 2026, $30,000,000;(B)in each allocation period starting after fiscal year 2026, the lessor of—(i)$15,000,000; or(ii)20 percent of the amount remaining in the Consumer Financial Civil Penalty Fund after allocation to victims has been determined for the prior allocation period; and(C)in any allocation period with respect to which the amount in the Consumer Financial Civil Penalty Fund decreased during the prior allocation period, 1 percent of the amount remaining in the Consumer Financial Civil Penalty Fund after allocation to victims has been determined for the prior allocation period.(f)

Initial study

(1)

In general

Not later than 1 year after the date of enactment of this section, the Director shall conduct a study on the financial literacy education needs of expected participants of the financial literacy programs facilitated by this section.(2)

Findings

The findings of the study required under paragraph (1) may be used to inform the award allocations by the program established under subsection (a). (g)

Financial Literacy and Education Commission report

Not later than 2 years after the Director establishes the program under subsection (a), the Financial Literacy and Education Commission shall submit to Congress and the Director a report that provides recommendations on improving the program.(h)

Definitions

In this section:(1)

Allocation period

The term allocation period means the biannual allocation period of funds to a class of victims that occurs according to the schedule established pursuant to section 1075.105(b) of title 12, Code of Federal Regulations (or any successor regulation).(2)

Eligible entity

The term eligible entity—(A)means—(i)a State government, local government, or agency of a State or local government; and(ii)other entities that the Director may identify, including those that have—(I)experience with financial management;(II)a history of achieving goals and objectives of financial literacy programs;(III)expertise in financial education; or(IV)expertise in providing financial education instruction; and(B)does not include any entity if the entity, or a subsidiary or affiliate of the entity, has been found to have violated any Federal consumer financial law.(3)

State

The term State means each State of the United States, the District of Columbia, each territory or possession of the United States, and each federally recognized Indian Tribe.

(b)

Conforming amendments

The Dodd-Frank Wall Street Reform and Consumer Protection Act (12 U.S.C. 5497(d)(2)) is amended—(1)in the table of contents, by inserting after the item relating to section 1037 the following:

Sec. 1038. Financial literacy award allocation program.

;

and

(2)in section 1017(d)(2)—(A)by striking , the Bureau may use and inserting

, the Bureau—(A)may use

;

(B)by striking programs. and inserting programs; and; and(C)by adding at the end the following:

(B)shall use such funds for the award allocation program established under section 1038.