[Congressional Bills 118th Congress]
[From the U.S. Government Publishing Office]
[S. 4295 Introduced in Senate (IS)]

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118th CONGRESS
  2d Session
                                S. 4295

To establish that institutions of higher education shall be ineligible 
    for funds under the Higher Education Act of 1965 due to campus 
                               disorder.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                              May 9, 2024

   Mr. Vance introduced the following bill; which was read twice and 
                  referred to the Committee on Finance

_______________________________________________________________________

                                 A BILL


 
To establish that institutions of higher education shall be ineligible 
    for funds under the Higher Education Act of 1965 due to campus 
                               disorder.

    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 ``Encampments or Endowments Act''.

SEC. 2. INELIGIBILITY DUE TO CAMPUS DISORDER.

    (a) In General.--Part B of title I of the Higher Education Act of 
1965 (20 U.S.C. 1011 et seq.) is amended by adding at the end the 
following:

``SEC. 124. INELIGIBILITY DUE TO CAMPUS DISORDER.

    ``(a) In General.--Notwithstanding any other provision of law, no 
institution of higher education shall be eligible to receive funds 
under this Act (including funds for Federal student assistance under 
title IV) or participate in programs under title IV if the Secretary 
determines that the institution of higher education has failed to 
disestablish any permanent encampment on the institution's campus if 
occupants of the encampment, whether or not affiliated with the 
institution of higher education--
            ``(1) have attempted to interfere with a core function of 
        the institution of higher education; or
            ``(2) have obstructed the ingress or egress of students.
    ``(b) Definitions.--In this section:
            ``(1) Campus.--The term `campus' has the meaning given the 
        term in section 485(f)(6).
            ``(2) Core function of a university.--The term `core 
        function of a university' means classroom instruction, 
        research, and academic ceremonies performed as part of the 
        matriculation, education, or graduation of students, including 
        commencement ceremonies.
            ``(3) Encampment.--The term `encampment' means any 
        establishment on the campus of the institution of higher 
        education containing any tent, lean-to, shack, or other 
        structure erected for the purpose of maintaining a temporary or 
        permanent place to live or reside, or where any bedding, 
        sleeping bag, stove, or collection of personal belongings has 
        been placed for the purpose of maintaining temporary or 
        permanent habitability.
            ``(4) Permanent encampment.--The term `permanent 
        encampment' means any encampment existing on the campus of the 
        institution of higher education for 7 days or more.
    ``(c) Regaining Eligibility.--On the date that is 5 years after the 
date on which an institution is declared ineligible under this section, 
that institution may submit an application to the Secretary containing 
a request to regain such eligibility, and the Secretary shall consider 
such request.''.
    (b) Applicability.--The amendment made by subsection (a) shall take 
effect on the date of enactment of this Act, and ineligibility with 
respect to any grant, loan, or work assistance provided under title IV 
of the Higher Education Act of 1965 (20 U.S.C. 1070 et seq.) due to a 
violation of subsection (a) shall apply on or after July 1, 2025.
    (c) FAFSA Determinations.--The Secretary of Education shall 
continue to receive and process the Free Application for Federal 
Student Aid for continuously enrolled students (as defined in section 
4969 of the Internal Revenue Code of 1986, as added by section 3), in 
order to make a determination about the covered Federal financial 
assistance amount (as defined under such section) for such students.

SEC. 3. EXCISE TAX ON THE ENDOWMENTS OF CERTAIN DISQUALIFIED COLLEGES 
              AND UNIVERSITIES.

    (a) In General.--Subchapter H of chapter 42 of the Internal Revenue 
Code of 1986 is amended by adding at the end the following new section:

``SEC. 4969. EXCISE TAX ON ENDOWMENT INCOME OF CERTAIN DISQUALIFIED 
              COLLEGES AND UNIVERSITIES.

    ``(a) Tax Imposed.--There is hereby imposed on each disqualified 
educational institution for any taxable year a tax equal to 50 percent 
of the aggregate fair market value of the assets of the institution at 
the end of the preceding taxable year.
    ``(b) Disqualified Educational Institution.--For purposes of this 
section, with respect to a taxable year--
            ``(1) In general.--The term `disqualified educational 
        institution' means an eligible educational institution (as 
        defined in section 25A(f)(2)) which is ineligible to receive 
        funds under the Higher Education Act of 1965 (including funds 
        for Federal student assistance under title IV of such Act) or 
        participate in programs under title IV of such Act pursuant to 
        section 124 of such Act.
            ``(2) Exception.--An institution shall not be treated as a 
        disqualified educational institution for the taxable year if 
        such institution--
                    ``(A) for the academic year ending with or within 
                the taxable year, provides grant funds for all 
                continuously enrolled students of the institution in an 
                amount equal to the covered Federal financial 
                assistance amount for such students, and
                    ``(B) demonstrates such assistance to the Secretary 
                of Education.
    ``(c) Assets.--The rules of section 4968(d) shall apply for 
purposes of this section.
    ``(d) Continuously Enrolled Students.--For purposes of this 
section, the term `continuously enrolled student' means a student who--
            ``(1) is enrolled at an institution of higher education 
        when that institution was determined to be ineligible for 
        Federal student assistance pursuant to section 124 of the 
        Higher Education Act of 1965; and
            ``(2) has continued enrollment in the same degree program 
        at that institution.
    ``(e) Covered Federal Financial Assistance Amount.--For purposes of 
this section, the term `covered Federal financial assistance amount' 
means the amount of Federal financial assistance under title IV of the 
Higher Education Act of 1965 (including through grants, loans, and work 
assistance) for which a student who is a continuously enrolled student 
in a disqualified educational institution would have been eligible, 
with respect to an applicable award year, if the disqualified 
educational institution were participating in the financial assistance 
programs under such title IV, as calculated based on a student's 
submission of the Free Application for Federal Student Aid and in 
accordance with part F of such title IV.''.
    (b) Clerical Amendment.--The table of sections for subchapter H of 
chapter 42 of the Internal Revenue Code of 1986 is amended by adding at 
the end the following new item:

``Sec. 4969. Excise Tax on the Endowments of Certain Disqualified 
                            Colleges and Universities.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years ending after July 1, 2025.
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