[Congressional Record Volume 149, Number 155 (Thursday, October 30, 2003)]
[Senate]
[Pages S13663-S13668]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. AKAKA (for himself, Mr. Sarbanes, and Mr. Corzine):
  S. 1800. A bill to amend the Higher Education Act of 1965 to enhance 
literacy in finance and economics, and for other purposes; to the 
Committee on Health, Education, Labor, and Pensions.
  Mr. AKAKA. Mr. President, today I am introducing the College Literacy 
in Finance and Economics or College LIFE Act. I would like to thank my 
colleagues, Senators Sarbanes and Corzine, for their cosponsorship of 
this important legislation.
  The problem we're working to address with the College LIFE Act is 
simple. Our college students are many of America's best and the 
brightest. They hold the promise of our country in their hands and will 
go on to become leaders--in business, education, politics, the 
military, the community--any field you can name. It is wonderful that 
so many people are pursuing and fulfilling their dreams of higher 
education in numbers that I did not imagine when I was in college. In 
fact, as reported by the American Council on Education, total college 
enrollment surged by 3 million or nearly 27 percent over the past 20 
years. However, I am gravely concerned, both as a member of this body 
and particularly as a grandparent and great-grandparent, that our young 
people are entering college without proper direction or good skills for 
money management or economic decisionmaking.
  As we work on increasing access to higher education, we must give 
students access to the tools that they need to make sound economic and 
financial decisions once they are on campus. However, the lack of 
personal finance and economics State K-12 education standards or 
implementation of existing standards in K-12 education in a number of 
States results in many students arriving at college with little 
understanding of economic concepts like supply and demand or benefits 
versus costs, or personal finance concepts such as household money 
management or the importance of maintaining good credit history. 
Without this basic understanding, college students are not effectively 
evaluating credit alternatives, managing their debt, and preparing for 
long-term financial goals, such as saving for a home or retirement.
  We can try to imagine what it's like to be a college student's shoes. 
A young adult leaves his home and travels thousands of miles, as do 
many Hawaii students attending mainland colleges, to the campus that 
holds his hopes and dreams. Perhaps farthest from his mind is how 
little spending money he has for textbooks, a new college sweatshirt, 
and school supplies. He gets to the campus bookstore and walks out with 
a bag that includes a preapproved credit card application, which he 
immediately fills out and mails. Months later, he has joined many other 
credit card-holding college student who, on average, have a credit card 
bill balance above $3,000. His sophomore year rolls around and, instead 
of conferring with his parents about the details of his renewal FAFSA 
for student financial aid or master promissory note, he is saddled with 
another $10,000 loan. According to The College Board, average college 
tuition and fees in 2003-04 increased to $19,710 for a four-year 
private institution and to $4,694 for a 4-year public institution. The 
same scenario repeats itself for his junior and senior years. Finally, 
after successfully completing all of his coursework, he graduates, 
finds an entry-level job, and realizes that, after servicing his debt, 
he has little money left for basics such as food, transportation, and 
rent, much less new career clothing or social outings. His lack of 
knowledge about how to properly use credit has led him to anxiety-
causing financial missteps. With appropriate financial and economic 
literacy, he may have known what debt load to anticipate and made wiser 
financing and spending decisions while in school.

  Rather, he may be on the road to true financial trouble. Dan 
Iannicola, Jr., Deputy Assistant Secretary of the Treasury for 
Financial Education, testified before a House subcommittee on Tuesday, 
that 40 percent of Americans say they live beyond their means, with the 
average American household having $8,900 in credit card debt in 2002--
up from $3,200 just 10 years earlier. In 2001, more people filed for 
bankruptcy than graduated from college. Furthermore, the most recent 
Federal Reserve Bulletin reported that Americans currently pay 13.3 
percent of after-tax income to service their debts, which increases to 
18.1 percent when we add other recurring liabilities such as rent and 
auto leases. We must ensure that our youth make the right decisions to 
follow a better financial path, especially considering a report cited 
by Mr. Iannicola noting that youth spent more than $172 billion in a 
recent year, and figures from MarketResearch.com noting that typical 8- 
to 14-year-olds now spend--from allowances, jobs, and gifts--about 
$1,294 a year or $25 a week.
  The College LIFE (Literacy in Finance and Economics) Act represents a 
comprehensive approach to assist upcoming generations of Americans. It 
proposes four new grant programs that provide resources to encourage 
experimentation with delivery systems--innovation methods used in or 
out of the classroom to increase college students' financial literacy. 
Another grant would allow higher education institutions to share best 
practices about or create personal finance courses where none exist. A 
third grant would assist efforts that are looking at the best ways to 
integrate personal finance and economic education into basic 
educational subjects, which is especially important as schools are 
facing challenges under the No Child Left Behind Act and are tempted to 
focus on subjects being tested for Annual Yearly Progress. The final 
grant would train teachers and high school counselors toward increasing 
financial and economic literacy in grades K-12 so that our college 
students are prepared when they arrive at college campuses.
  The bill also proposes a pilot program for five higher education 
institutions to encourage students to take a personal finance course 
and participate in preventive annual credit counseling, working in 
conjunction with state or local public, private, and nonprofit entities 
selected by the local education

[[Page S13664]]

agency or the school, and measuring the effectiveness of efforts in any 
behavioral changes that may result. It promotes greater collaboration 
with and support from Federal agencies in the higher education arena 
with respect to economic and financial literacy. Finally, it emphasizes 
the importance of personal finance and economic education and 
counseling by authorizing these activities as allowable uses in 
existing Higher Education Act programs, such as TRIO, GEAR UP, and 
Title III and Title V Serving Institutions.
  Furthermore, I intend the reach of this bill to be beyond the 
traditional college student. Our returning college students are a vital 
part of society--many who are already community leaders and 
breadwinners for their families who have already gained valuable work 
experience that they may use as they learn a new field or continue 
their undergraduate study in the pursuit of a graduate or doctoral 
degree. In addition, older adults who are entering higher education for 
the first time can also be lauded for their enterprising spirit in 
wanting to better their lives by earning an associates or bachelors 
degree. I anticipate that the assistance provided through the College 
LIFE Act will work to provided needed help to many of these students as 
well.

  I have been working on this bill over the better part of this year 
with several organizations in the higher education and economic and 
financial literacy community. I ask unanimous consent to have printed 
in the Record after my statement letters of support for the legislation 
from the National Council on Economic Education, Jump$tart Coalition 
for Personal Financial Literacy, and Family, Career and Community 
Leaders of America. I thank these and other organizations for their 
constant efforts in this area. For example, the National Council for 
Community and Education Partnerships (NCCEP) supports a provision 
including economic and financial literacy and counseling as allowable 
activities for the GEAR-UP program, which provides comprehensive 
mentoring, counseling, outreach, and supportive services to cohorts of 
disadvantaged students. Emphasis on economic and financial literacy as 
included in the bill would complement NCCEP'S current GEAR-UP 
activities that underscore the importance of the college-going 
experience and pursuit of postsecondary education--including 
discussions about financial aid, debt, grants vs. loans, savings, and 
tax credits--and involving parents or guardians to inform them on the 
costs of college and how to prepare for their child's entry into 
college. I will continue to work with these and other organizations 
toward increasing literacy in finance and economics for our students 
before they enter higher education and once they arrive on college 
campuses.
  I am looking forward to continuing to work with my colleagues to have 
the College LIFE Act passed or included in the upcoming Higher 
Education Act reauthorization. I encourage my colleagues' support for 
this bill.
  I ask unanimous consent that the bill be printed in the Record.
  There being no objection, the Material was ordered to be printed in 
the Record, as follows:
                                                  National Council


                                        on Economic Education,

                                  Washington, DC, October 1, 2003.
     Hon. Daniel K. Akaka,
     U.S. Senator,
     Washington, DC.
       Dear Senator Akaka: For over 50 years, the National Council 
     on Economic Education (NCEE), through its nationwide network 
     of State Councils and University Centers for Economic 
     Education, has been the nation's premier organization for 
     promoting effective economic education, by training teachers 
     to get basic economic knowledge and decision-making skills 
     into the heads and hands of our young people, K-12.
       NCEE's mission is to ensure the effective teaching of the 
     real-life skills people need to succeed in an increasingly 
     complex world: to be able to think and choose knowledgeably 
     as consumers, savers, and investors, responsible citizens, 
     members of the workforce, and effective participants in the 
     global economy.
       Because of our nationwide university and college base, we 
     at the National Council on Economic Education (NCEE) strongly 
     endorse the College LIFE (Literacy in Finance and Economics) 
     Act.
       The College LIFE (Literacy in Finance and Economics) Act, 
     which seeks to provide university students with personal 
     finance counseling, and to prepare teachers and high school 
     counselors to equip our young people with personal finance 
     knowledge and skills, could not come at a better time.
       This is a time of growing public interest in personal 
     finance education. Parents everywhere want their children to 
     know how the world works before they go to work in it, and to 
     possess the basic knowledge and decision-making skills that 
     will help them to become productive and responsible citizens, 
     employees, consumers, savers and investors. Any legislation 
     that advances that effort in a sustained, systematic way has 
     our support.
       The NCEE is pleased to support the College LIFE (Literacy 
     in Finance and Economics) Act. Please keep us informed of its 
     progress.
           Yours sincerely,
                                                 Robert F. Duvall,
     President & Chief Executive Officer.
                                  ____



                                          Jump$tart Coalition,

                                  Washington, DC, October 9, 2003.
     Senator Daniel K. Akaka,
     Hart Building,
     Washington, DC.
       Dear Senator Akaka: On behalf of the Jump$tart Coalition 
     for Personal Financial Literacy (a coalition of 150 
     organizations promoting personal finance education for 
     youth), we thank you for sponsoring the College Literacy in 
     Finance and Economics (College LIFE) Act.
       The passage of this Act would signify an elevation in 
     importance of the issue of youth financial literacy by Higher 
     Education. The problems related to financially illiterate 
     young adults need to be addressed. We cannot continue the 
     ten-fold increase in young adults filing bankruptcy that we 
     have seen in the past five years. Nor can we afford to have 
     young adults dropping out of college due to heavy credit card 
     debt or not understanding the importance of investing for 
     their retirement.
       In light of these distressing problems, it is imperative 
     that we start to embed personal finance and economic 
     education more widely into our college and university 
     curricula. Currently the percentage of college students 
     having the opportunity to enroll in such classes is small 
     considering their lack of promotion and availability.
       The good news is that education is the answer and the 
     solution is found through existing resources. A wide 
     selection of curricula (many free or low cost) in addition to 
     teacher training networks and guest speaker supplements are 
     available. The remaining obstacle lies in opening the doors 
     of Higher Education to this invaluable instruction.
       Therefore, Jump$tart wholeheartedly supports Senator 
     Akaka's College LIFE Act for its emphasis on a subject and 
     skill that is invaluable to surviving in today's complex 
     financial marketplace.
       The Jump$tart Coalition thanks you for your continuing 
     support of financial and economic education.
           Sincerely,
                                                      Dara Duguay,
     Executive Director.
                                  ____

                                                Family, Career and


                                 Community Leaders of America,

                                     Reston, VA, October 29, 2003.
     Senator Daniel K. Akaka,
     Hart Senate Office Building,
     Washington, DC.
       Dear Senator Akaka, Family, Career and Community Leaders of 
     America is a dynamic and effective national student 
     organization with a membership of over 227,000 that helps 
     young men and women become leaders and address important 
     personal, family, work, and societal issues through Family 
     and Consumer Sciences Education (FACS). One of those 
     important issues is financial responsibility, which is a part 
     of the FACS discipline.
       FCCLA Advisers are FACS teachers who use the FCCLA 
     Financial Fitness national peer education program to promote 
     youth teaching other young people how to make, save, and 
     spend money wisely. Its goals are to sharpen young people's 
     skills in money management, consumerism, and financial 
     planning; as well as provide youth an opportunity to teach 
     others and develop financial literacy, communication, and 
     leadership skills. This program includes educational tools 
     and recognition for chapter projects.
       We strongly support the College LIFE (Literacy in Finance 
     and Economics) Act, as it shares the goals of the FCCLA 
     Financial Fitness program. The importance of consumer 
     education that FCCLA introduces to its youth will be able to 
     be carried on to higher education with the passage of this 
     Act. Skills learned through personal finance and economic 
     education courses will better prepare students for success in 
     their careers and their lives.
       FCCLA is grateful to you for your enduring advocacy of 
     financial and economic education through the College LIFE 
     Act.
           Sincerely,
                                               Alan T. Rains, Jr.,
     Executive Director.
                                  ____


                                S. 1800

       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 ``College Literacy in Finance 
     and Economics (College LIFE) Act''.

     SEC. 2. AREAS OF EMPHASIS.

       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. 123. AREAS OF EMPHASIS.

       ``In carrying out activities under this Act related to 
     improving financial and economic

[[Page S13665]]

     literacy, education, and counseling, the Secretary shall 
     emphasize, among other elements, basic personal income and 
     household money management and financial planning skills, and 
     basic economic decision making skills, including how to--
       ``(1) create household budgets, initiate savings plans, and 
     make strategic investment decisions for education, 
     employment, retirement, home ownership, wealth building, or 
     other savings goals;
       ``(2) manage credit and debt effectively, including student 
     financial aid and credit card debt, and understand the merits 
     of establishing and maintaining excellent credit history;
       ``(3) understand, evaluate, and compare fair and favorable 
     financial products, services, and opportunities, and avoid 
     abusive, predatory, or deceptive financial products, 
     services, and opportunities;
       ``(4) complete tax returns and understand tax consequences 
     when making certain financial decisions, such as placing an 
     investment or purchasing a home;
       ``(5) identify economic problems, alternatives, benefits, 
     and costs;
       ``(6) analyze the incentives at work in an economic 
     situation;
       ``(7) examine the consequences of changes in economic 
     conditions and public policies;
       ``(8) collect and organize economic evidence, including 
     understanding, evaluating, and making strategic decisions 
     using economic indicators;
       ``(9) compare benefits with costs; and
       ``(10) improve financial and economic literacy and 
     education through all other related skills.''.

     SEC. 3. COORDINATION.

       In carrying out the financial and economic literacy 
     activities authorized under this Act and the amendments made 
     by this Act, the Secretary of Education, to the greatest 
     extent practicable, shall coordinate such activities with the 
     financial and economic literacy efforts of a Federal 
     commission comprised of members from the Department of 
     Education, the Department of the Treasury, and other entities 
     the President, the Secretary of Education, and the Secretary 
     of the Treasury determine appropriate.

     SEC. 4. ENHANCEMENT OF FINANCIAL LITERACY AND ECONOMIC 
                   LITERACY.

       The Higher Education Act of 1965 (20 U.S.C. 1001 et seq.) 
     is amended--
       (1) in section 201(a)(3), by inserting ``personal 
     finance,'' after ``economics,'';
       (2) in section 311(c)--
       (A) by redesignating paragraphs (7) through (12) as 
     paragraphs (8) through (13), respectively; and
       (B) by inserting after paragraph (6) the following:
       ``(7) Education or counseling services designed to improve 
     the financial literacy and economic literacy of students and 
     their parents.'';
       (3) in section 316(c)(2)--
       (A) by redesignating subparagraphs (G) through (L) as 
     subparagraphs (H) through (M), respectively;
       (B) by inserting after subparagraph (F) the following:
       ``(G) education or counseling services designed to improve 
     the financial literacy and economic literacy of students and 
     their parents;''; and
       (C) in subparagraph (M), as redesignated by subparagraph 
     (A), by striking ``subparagraphs (A) through (K)'' and 
     inserting ``subparagraphs (A) through (L)'';
       (4) in section 317(c)(2)--
       (A) in subparagraph (G), by striking ``and'' after the 
     semicolon;
       (B) in subparagraph (H), by striking the period at the end 
     and inserting ``; and''; and
       (C) by adding at the end the following:
       ``(I) education or counseling services designed to improve 
     the financial literacy and economic literacy of students and 
     their parents.'';
       (5) in section 323(a)--
       (A) by redesignating paragraphs (7) through (12) as 
     paragraphs (8) through (13), respectively; and
       (B) by inserting after paragraph (6) the following:
       ``(7) Education or counseling services designed to improve 
     the financial literacy and economic literacy of students and 
     their parents.'';
       (6) in section 326(c)--
       (A) by redesignating paragraphs (5) through (7) as 
     paragraphs (6) through (8), respectively; and
       (B) by inserting after paragraph (4) the following:
       ``(5) education or counseling services designed to improve 
     the financial literacy and economic literacy of students and 
     their parents;'';
       (7) in section 503(b)--
       (A) by redesignating paragraphs (5) through (14) as 
     paragraphs (6) through (15), respectively; and
       (B) by inserting after paragraph (4) the following:
       ``(5) Education or counseling services designed to improve 
     the financial literacy and economic literacy of students and 
     their parents.'';
       (8) in section 402B(b)--
       (A) by redesignating paragraphs (3) through (10) as 
     paragraphs (4) through (11), respectively;
       (B) by inserting after paragraph (2) the following:
       ``(3) education or counseling services designed to improve 
     the financial literacy and economic literacy of students and 
     their parents;''; and
       (C) in paragraph (11), as redesignated by subparagraph (A), 
     by striking ``paragraphs (1) through (9)'' and inserting 
     ``paragraphs (1) through (10)'';
       (9) in section 402C--
       (A) in subsection (b)--
       (i) by redesignating paragraphs (2) through (12) as 
     paragraphs (3) through (13), respectively;
       (ii) by inserting after paragraph (1) the following:
       ``(2) education or counseling services designed to improve 
     the financial literacy and economic literacy of students and 
     their parents;''; and
       (iii) in paragraph (13), as redesignated by clause (i), by 
     striking ``paragraphs (1) through (11)'' and inserting 
     ``paragraphs (1) through (12)''; and
       (B) in subsection (e), by striking ``subsection (b)(10)'' 
     and inserting ``subsection (b)(11)'';
       (10) in section 402D(b)--
       (A) by redesignating paragraphs (2) through (10) as 
     paragraphs (3) through (11), respectively;
       (B) by inserting after paragraph (1) the following:
       ``(2) education or counseling services designed to improve 
     the financial literacy and economic literacy of students and 
     their parents;''; and
       (C) in paragraph (11), as redesignated by subparagraph (A), 
     by striking ``paragraphs (1) through (9)'' and inserting 
     ``paragraphs (1) through (10)'';
       (11) in section 402E(b)--
       (A) by redesignating paragraphs (7) and (8) as paragraphs 
     (8) and (9), respectively; and
       (B) by inserting after paragraph (6) the following:
       ``(7) education or counseling services designed to improve 
     the financial literacy and economic literacy of students and 
     their parents;'';
       (12) in section 402F(b)--
       (A) by redesignating paragraphs (4) through (10) as 
     paragraphs (5) through (11), respectively;
       (B) by inserting after paragraph (3) the following:
       ``(4) education or counseling services designed to improve 
     the financial literacy and economic literacy of students and 
     their parents;''; and
       (C) in paragraph (11), as redesignated by subparagraph (A), 
     by striking ``paragraphs (1) through (9)'' and inserting 
     ``paragraphs (1) through (10)'';
       (13) in section 404D(b)(2)(A)(ii), by striking ``and 
     academic counseling'' and inserting ``academic counseling, 
     and financial literacy and economic literacy education or 
     counseling'';
       (14) by striking section 418A(c)(1)(B)(i) and inserting the 
     following:
       ``(i) personal, academic, career, and economic education or 
     personal finance counseling as an ongoing part of the 
     program;'';
       (15) in section 428F(b), by inserting at the end the 
     following: ``Where appropriate, such program shall include 
     making available financial and economic education materials 
     for the borrower.'';
       (16) in section 432(k)(1), by striking ``and offering'' and 
     all that follows through the period and inserting ``, 
     offering loan repayment matching provisions as part of 
     employee benefit packages, and providing employees with 
     financial and economic education and counseling.'';
       (17) in section 441(c)--
       (A) in paragraph (1), by inserting ``financial literacy and 
     economic literacy,'' after ``social services,''; and
       (B) in paragraph (4)(C), by striking the period at the end 
     and inserting ``and counseling for the purposes of improving 
     financial literacy and economic literacy.'';
       (18) in section 485--
       (A) in subsection (a)(1)(D), by striking the semicolon at 
     the end and inserting ``, including the merits of taking a 
     personal finance course, if the institution offers such a 
     course, and of the student reviewing the student's personal 
     credit profile not less frequently than once a year;'';
       (B) in subsection (b)--
       (i) in paragraph (1)(A)--

       (I) in clause (i), by striking ``and'' after the semicolon;
       (II) in clause (ii), by striking the period at the end and 
     inserting ``; and''; and
       (III) by adding at the end the following:

       ``(iii) if it is determined during the counseling that the 
     borrower is not connected to a mainstream financial 
     institution, information about low-cost financial services 
     and the benefits of using such services, and where and how 
     the borrower could open a low-cost account in a federally 
     insured credit union or bank.''; and
       (ii) by adding at the end the following:
       ``(3) Pilot program.--
       ``(A) Authorization.--
       ``(i) In general.--The Secretary shall establish a pilot 
     program that awards a total of 5 grants to 5 different 
     institutions of higher education that are located in 
     geographically different parts of the United States to enable 
     the institutions to provide annual personal finance 
     counseling for students enrolled at such institutions.
       ``(ii) Minority serving institutions.--In awarding grants 
     under this paragraph, the Secretary shall award not less than 
     2 of the 5 grants to institutions of higher education that 
     are eligible to receive assistance under title III or title 
     V.
       ``(B) Application.--An institution of higher education that 
     desires to receive a grant

[[Page S13666]]

     under this paragraph shall submit an application to the 
     Secretary at such time, in such manner, and containing such 
     information as the Secretary may require.
       ``(C) Use of funds.--
       ``(i) Counseling.--

       ``(I) In general.--In addition to making available exit 
     counseling under paragraph (1), an institution of higher 
     education that receives a grant under this paragraph shall 
     through financial aid officers or otherwise, make available 
     counseling to borrowers of loans which are made, insured, or 
     guaranteed under part B (other than loans made pursuant to 
     section 428B) of this title or made under part D or E of this 
     title at the commencement of the borrower's course of study 
     at the institution, not less frequently than once annually 
     while the borrower is enrolled at the institution, and not 
     later than 30 days after completion of the course of study 
     for which the borrower enrolled at the institution or at the 
     time of departure from such institution.
       ``(II) Content.--The counseling required under subclause 
     (I) shall include the average anticipated monthly repayments, 
     a review of the repayment options available, the total amount 
     of interest that would be paid over a range of possible 
     interest rates and the amount of interest in the monthly 
     payments, information on the availability and content of a 
     personal finance course if such course is offered by the 
     institution and if not already completed by the individual, 
     and such debt and management strategies as the institution 
     determines are designed to facilitate the repayment of such 
     indebtedness, which may be implemented in partnership with 
     State or local public, private, and nonprofit entities 
     approved by the local educational agency that serves schools 
     in the area where the institution is located, or a campus 
     committee formed for the purpose of evaluating the 
     qualifications of such entities. If it is determined during 
     the counseling that the borrower is not connected to a 
     mainstream financial institution, the counseling shall 
     include information about low-cost financial services and the 
     benefits of using such services, and where and how the 
     borrower could open a low-cost account in a federally insured 
     credit union or bank.

       ``(ii) Permissive use.--Grant funds received under this 
     paragraph may be used to pay for additional financial aid 
     personnel or for training for existing financial aid 
     personnel.
       ``(iii) Study.--

       ``(I) In general.--An institution of higher education that 
     receives a grant under this paragraph shall conduct a study 
     to evaluate the impacts, if any, of the financial and 
     economic literacy and counseling activities on students' 
     levels of savings and indebtedness, and creditworthiness, and 
     such activities' effectiveness in reducing the incidence of 
     problems with handling credit, including bankruptcy filing 
     and student financial loan default.
       ``(II) Assistance.--An institution of higher education may 
     conduct the study under subclause (I) with the assistance of 
     appropriate Federal agencies or other entities approved by 
     the Secretary.
       ``(III) Report.--Not later than 6 months after completion 
     of the study under subclause (I), the institution of higher 
     education shall report the results of such study to the 
     Secretary, the Secretary of the Treasury, the Committee on 
     Health, Education, Labor, and Pensions of the Senate, the 
     Committee on Banking, Housing, and Urban Affairs of the 
     Senate, the Committee on Education and the Workforce of the 
     House of Representatives, and the Committee on Financial 
     Services of the House of Representatives.

       ``(D) Duration.--Grants awarded under this paragraph shall 
     be for a period of 3 years.
       ``(E) Amount.--The Secretary shall award grants of not more 
     than $1,000,000 annually to each institution of higher 
     education awarded a grant under this paragraph. The Secretary 
     may determine the grant award amount based on the number of 
     students to be counseled at the institution of higher 
     education.
       ``(F) Report.--Not later than 90 days after the date of 
     completion of the pilot program under this paragraph, the 
     Secretary shall submit a report to Congress on the 
     effectiveness of the program.
       ``(G) Authorization of appropriations.--There is authorized 
     to be appropriated to carry out this paragraph such sums as 
     may be necessary for each of fiscal years 2005 through 
     2009.''; and
       (C) in subsection (c), by adding at the end the following: 
     ``Appropriate Federal agencies shall provide material 
     developed by such agencies for the purpose of financial 
     education, to financial assistance information personnel at 
     institutions of higher education for the use of such 
     personnel in financial aid counseling.''; and
       (19) in section 491(d)(8), by inserting ``, including those 
     related to financial literacy activities,'' after ``resources 
     and services''.

     SEC. 5. GRANT PROGRAMS.

       (a) Innovative Delivery Systems.--
       (1) Definitions.--In this subsection:
       (A) Delivery system.--The term ``delivery system'' means 
     any range of media or methods that institutions of higher 
     education use to instruct or to convey information to the 
     students enrolled at such institutions.
       (B) Eligible entity.--The term ``eligible entity''--
       (i) means an institution of higher education; and
       (ii) includes an institution of higher education in 
     partnership with a public, private, or nonprofit entity.
       (C) Institution of higher education.--The term 
     ``institution of higher education'' has the meaning given the 
     term in section 101 of the Higher Education Act of 1965 (20 
     U.S.C. 1001).
       (D) Secretary.--The term ``Secretary'' means the Secretary 
     of Education.
       (2) Authorization.--From funds appropriated under paragraph 
     (10), the Secretary shall award grants, on a competitive 
     basis, to eligible entities to enable such entities to 
     develop or sponsor experimental financial literacy delivery 
     systems.
       (3) Application.--
       (A) In general.--An eligible entity that desires to receive 
     a grant under this subsection shall submit an application to 
     the Secretary at such time, in such manner, and containing 
     such information as the Secretary may require.
       (B) Content.--An application submitted under subparagraph 
     (A) shall include--
       (i) a description of the plan for the development or 
     sponsorship of the financial literacy delivery system the 
     eligible entity intends to support with grant funds received 
     under this subsection;
       (ii) information on the students expected to be served by 
     such system; and
       (iii) information on the means by which the effectiveness 
     of such system will be measured.
       (4) Awarding of grants.--In awarding grants under this 
     subsection, the Secretary shall--
       (A) give priority to eligible entities that take measures 
     to ban or discourage the proliferation of credit cards and 
     abusive credit marketing practices on campus; and
       (B) consider--
       (i) the quality of the proposed financial literacy delivery 
     system and the degree to which such system may be used as a 
     model for adoption by other institutions of higher education;
       (ii) the resources, if any, that the eligible entity 
     intends to dedicate to the implementation of the plan for the 
     development or sponsorship of such system;
       (iii) the degree to which technology is to be used in the 
     implementation of such plan; and
       (iv) the degree to which the eligible entity will 
     collaborate with other entities in implementing such plan.
       (5) Use of funds.--An eligible entity awarded a grant under 
     this subsection shall use the grant funds--
       (A) to develop or sponsor an experimental financial 
     literacy delivery system; and
       (B) for activities that explore and assess the 
     effectiveness of various delivery systems in delivering 
     personal financial education and counseling to students and 
     in increasing student personal financial literacy.
       (6) Obligation.--Grant funds received under this subsection 
     shall be available for obligation for a period of not more 
     than 4 years.
       (7) Technical assistance.--From not more than 5 percent of 
     the funds appropriated to carry out this subsection, the 
     Secretary shall make technical assistance available to 
     eligible entities that receive grants under this subsection.
       (8) Report.--An eligible entity that receives a grant under 
     this subsection shall submit a report--
       (A) on an annual basis, to the Secretary on the 
     effectiveness of the financial literacy delivery system; and
       (B) at the end of the grant period, to the appropriate 
     committees of Congress on the effectiveness of the financial 
     literacy delivery system.
       (9) Regulations.--The Secretary shall promulgate 
     regulations to carry out this subsection.
       (10) Authorization of appropriations.--There is authorized 
     to be appropriated to carry out this subsection $5,000,000 
     for each of fiscal years 2005 through 2009.
       (b) Personal Finance Course.--
       (1) Definitions.--In this subsection:
       (A) Eligible entity.--The term ``eligible entity''--
       (i) means an institution of higher education; and
       (ii) includes an institution of higher education in 
     partnership with a public, private, or nonprofit entity.
       (B) Institution of higher education.--The term 
     ``institution of higher education'' has the meaning given the 
     term in section 101 of the Higher Education Act of 1965 (20 
     U.S.C. 1001).
       (C) Secretary.--The term ``Secretary'' means the Secretary 
     of Education.
       (2) Authorization.--From funds appropriated under paragraph 
     (8), the Secretary shall award grants, on a competitive 
     basis, to eligible entities to enable such entities to--
       (A) if such entities do not offer a course in personal 
     finance, create a course in personal finance; or
       (B) if such entities offer a course in personal finance, 
     share best practices and related information with other 
     institutions of higher education about successful personal 
     finance courses.
       (3) Application.--
       (A) In general.--An eligible entity that desires to receive 
     a grant under this subsection shall submit an application to 
     the Secretary at such time, in such manner, and containing 
     such information as the Secretary may require.

[[Page S13667]]

       (B) Content.--An application submitted under subparagraph 
     (A) shall include--
       (i) if the entity intends to create a course in personal 
     finance with grant funds received under this subsection, 
     information on the number of students who could enroll in 
     such course and the expected outcomes of the course; or
       (ii) if the entity already offers a course in personal 
     finance, information on how the institution will share its 
     best practices with other institutions.
       (4) Awarding of grants.--In awarding grants under this 
     subsection, the Secretary shall give priority to eligible 
     entities that take measures to ban or discourage the 
     proliferation of credit cards and abusive credit marketing 
     practices on campus.
       (5) Obligation.--Grant funds received under this subsection 
     shall be available for obligation for a period of not more 
     than 3 years.
       (6) Report.--An eligible entity that receives a grant under 
     this subsection shall submit a report--
       (A) on an annual basis, to the Secretary on the 
     effectiveness of the personal finance course in increasing 
     the personal financial literacy of students who complete such 
     course; and
       (B) at the end of the grant period, to the appropriate 
     committees of Congress on the effectiveness of the personal 
     finance course in increasing the personal financial literacy 
     of students who complete such course.
       (7) Regulations.--The Secretary shall promulgate 
     regulations to carry out this subsection.
       (8) Authorization of appropriations.--There is authorized 
     to be appropriated to carry out this subsection $5,000,000 
     for each of fiscal years 2005 through 2009.
       (c) Integration.--
       (1) Authorization.--From funds appropriated under paragraph 
     (6), the Secretary of Education (referred to in this 
     subsection as the ``Secretary'') shall award a grant, on a 
     competitive basis, to a nonprofit organization, or a 
     consortium of nonprofit organizations, working in partnership 
     with relevant Federal agencies, educational organizations, 
     and other nonprofit organizations, to study and recommend the 
     best ways to integrate personal finance and economics into 
     basic educational subjects.
       (2) Application.--A nonprofit organization, or consortium 
     of nonprofit organizations, that desires to receive the grant 
     under this subsection shall submit an application to the 
     Secretary at such time, in such manner, and containing such 
     information as the Secretary may require.
       (3) Awarding of grants.--In awarding the grant under this 
     subsection, the Secretary shall--
       (A) give priority to an applicant that has as its primary 
     purpose the improvement of the quality of student 
     understanding of personal finance and economics; and
       (B) consider--
       (i) the previous record of work of the applicant in 
     improving the quality of student understanding of personal 
     finance and economics; and
       (ii) the degree to which the applicant has collaborated 
     with other entities that have as their primary purpose the 
     improvement of the quality of student understanding of 
     personal finance and economics.
       (4) Report.--Not later than 2 years after the grant funds 
     have been distributed under this subsection, the nonprofit 
     organization, or consortium of nonprofit organizations, that 
     receives the grant under this subsection shall submit to the 
     Secretary and the appropriate committees of Congress a report 
     on the best ways to integrate personal finance and economics 
     into basic educational subjects.
       (5) Regulations.--The Secretary shall promulgate 
     regulations to carry out this subsection.
       (6) Authorization of appropriations.--There is authorized 
     to be appropriated to carry out this subsection $1,000,000 
     for each of fiscal years 2005 through 2007.
       (d) Teacher and Counselor Training.--
       (1) Definitions.--In this subsection:
       (A) Eligible entity.--The term ``eligible entity''--
       (i) means--

       (I) an education department of an institution of higher 
     education; or
       (II) an organization described in section 501(c)(3) of the 
     Internal Revenue Code of 1986, that has as its primary 
     purpose the improvement of the quality of student 
     understanding of personal finance and economics through 
     effective teaching; and

       (ii) includes a partnership of the entities described in 
     clause (i).
       (B) Institution of higher education.--The term 
     ``institution of higher education'' has the meaning given the 
     term in section 101 of the Higher Education Act of 1965 (20 
     U.S.C. 1001).
       (C) Secretary.--The term ``Secretary'' means the Secretary 
     of Education.
       (D) State.--The term ``State'' means each of the 50 States, 
     the District of Columbia, the Commonwealth of Puerto Rico, 
     the United States Virgin Islands, Guam, American Samoa, the 
     Commonwealth of the Northern Mariana Islands, the freely 
     associated states of the Republic of the Marshall Islands, 
     the Federated States of Micronesia, and the Republic of 
     Palau.
       (2) Authorization.--From funds appropriated under paragraph 
     (10), the Secretary shall award grants, on a competitive 
     basis, to eligible entities to enable the entities to fund--
       (A) preservice teacher training programs in the instruction 
     of economics and personal finance in elementary schools and 
     secondary schools; and
       (B) programs to provide preservice and inservice training 
     of secondary school counselors in advising students on the 
     importance of improving their economic and personal financial 
     literacy.
       (3) Application.--
       (A) In general.--An eligible entity that desires to receive 
     a grant under this subsection shall submit an application to 
     the Secretary at such time, in such manner, and containing 
     such information as the Secretary may require.
       (B) Content.--An application submitted under subparagraph 
     (A) shall include information on--
       (i) the number of individuals who would be served by the 
     eligible entity if awarded a grant under this subsection; and
       (ii) the expected outcomes of the proposed training.
       (4) Awarding of grants.--
       (A) In general.--In awarding grants under this subsection, 
     the Secretary shall--
       (i) give priority to eligible entities that take measures 
     to ban or discourage the proliferation of credit cards and 
     abusive credit marketing practices on campus; and
       (ii) consider the applicant's past record of success in 
     carrying out similar training programs.
       (B) Grants to all states.--For any fiscal year for which 
     the amount appropriated to carry out this paragraph is more 
     than $25,000,000, the Secretary shall award not less than 1 
     grant to an eligible entity in each State.
       (5) Coordination with existing programs.--In carrying out 
     programs funded under this subsection, an eligible entity may 
     coordinate activities with other training programs, including 
     programs authorized under the Excellence in Economic 
     Education Act of 2001 (20 U.S.C. 7267 et seq.).
       (6) Supplement, not supplant.--Grant funds received under 
     this subsection shall be used to supplement, and not 
     supplant, non-Federal funds available to the eligible entity 
     for the purpose of carrying out similar training programs.
       (7) Obligation.--Grant funds received under this subsection 
     shall be available for obligation for a period of not more 
     than 3 years.
       (8) Report.--An eligible entity that receives a grant under 
     this subsection shall submit a report--
       (A) on an annual basis, to the Secretary on the 
     effectiveness of training teachers and counselors in 
     instructing and advising students on personal finance; and
       (B) at the end of the grant period, to the appropriate 
     committees of Congress on the effectiveness of training 
     teachers and counselors in instructing and advising students 
     on personal finance.
       (9) Regulations.--The Secretary shall promulgate 
     regulations to carry out this subsection.
       (10) Authorization of appropriations.--There is authorized 
     to be appropriated to carry out this subsection $10,000,000 
     for each of fiscal years 2005 through 2009.

     SEC. 6. EVALUATION.

       Not later than 6 years after the date of enactment of this 
     Act, the Comptroller General of the United States shall 
     submit to the Committee on Health, Education, Labor, and 
     Pensions of the Senate, the Committee on Banking, Housing, 
     and Urban Affairs of the Senate, the Committee on Education 
     and the Workforce of the House of Representatives, and the 
     Committee on Financial Services of the House of 
     Representatives, an evaluation of the range and effectiveness 
     of financial and economic education and financial aid 
     counseling activities of institutions of higher education, 
     lenders, servicers, and guaranty agencies as emphasized by 
     the Secretary of Education pursuant to section 123 of the 
     Higher Education Act of 1965.
  Mr. CORZINE. Mr. President, I am proud to join Senator Akaka as a co-
sponsor of the College LIFE (Literacy in Finance and Economics) Act.
  Unfortunately, when it comes to personal finances, most American 
college students do not have the skills they need to spend and save 
wisely. Most do not understand the details of managing a checking 
account, paying their taxes, or even using a credit card sensibly. 
College students must be given the tools they need to maintain good 
credit and make informed decisions about investments and savings so 
that they can ensure themselves a successful future.
  The importance of financial education cannot be understated, and this 
bill effectively addresses this critical issue by establishing grants 
that would allow institutions of higher education to provide their 
students with personal finance counseling and planning services. The 
bill also contains provisions that would encourage colleges to develop 
personal finance courses, giving students greater access to financial 
education. Finally, the bill would create a three-year pilot program in 
five institutions of higher education across the Nation to provide 
annual counseling for financial aid recipients.

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  Financial literacy has been a priority of mine since the start of my 
tenure in the U.S. Senate. Indeed, I believe that financial literacy 
should be a lifelong goal. Last Congress, I successfully added a 
provision to the No Child Left Behind Act to give elementary and 
secondary schools access to funds that will allow them to include 
financial education as part of their basic educational curriculum. This 
Congress, I have introduced the Education for Retirement Security Act 
of 2003, which would provide grants to non-profit organizations and 
State and local agencies for programs that would enhance financial and 
retirement knowledge for America's seniors. The bill also aims to 
reduce financial abuse and fraud, including telemarketing, mortgage, 
and pension fraud. Finally, I am the sponsor of a bill that would 
provide welfare recipients with greater access to financial literacy 
skills in order to help them achieve self-sufficiency.
  I know that Senator Akaka has a deep interest in this issue as well, 
and I am honored to join him in introducing the College LIFE Act, to 
ensure that college students have access to the financial knowledge 
that they need to make the right decisions about their futures.
                                 ______