Sec. 131. Performance-based organization for the delivery of Federal student financial assistance
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Section 141 ( 20 U.S.C. 1018 ) is amended— in subsection (a)(2)— by redesignating subparagraphs
(F)and
(G)as subparagraphs
(H)and (I), respectively; and by inserting after subparagraph
(E)the following: to maximize transparency in the operation of Federal student financial assistance programs; to maximize stakeholder engagement in the operation of and accountability for such programs; ; in subsection (b)— in paragraph (1)(C)— in clause (i), by striking and at the end; in clause (ii), by striking the period at the end and inserting ; and ; and by adding at the end the following: acquiring senior managers and other personnel with demonstrated management ability and expertise in consumer lending. ; in paragraph
(2)by adding at the end the following: Collecting input from stakeholders on the operation of all Federal student assistance programs and accountability practices relating to such programs, and ensuring that such input informs operation of the PBO and is provided to the Secretary to inform policy creation related to Federal student financial assistance programs. ; and in paragraph (6)— in subparagraph (A), by striking The Secretary and inserting Not less frequently than once annually, the Secretary ; by redesignating subparagraph
(B)as subparagraph (C); and by inserting after subparagraph
(A)the following: : On an annual basis, after carrying out the consultation required under subparagraph (A), the Secretary and the Chief Operating Officer shall jointly submit to the authorizing committees a report that includes— a summary of the consultation; and a description of any actions taken as a result of the consultation. . in subsection (c)— in paragraph (1)— in subparagraph (A)— by striking Each year, and inserting Not less frequently than once every three years, ; and by striking succeeding 5 and inserting succeeding 3 ; by amending subparagraph
(B)to read as follows: Beginning not later than 12 months before issuing each 3-year performance plan under subparagraph (A), the Secretary and the Chief Operating Officer shall consult with students, institutions of higher education, Congress, lenders, and other interested parties regarding the development of the plan. In carrying out such consultation, the Secretary shall seek public comment consistent with the requirements of subchapter II of chapter 5 of title 5, United States Code (commonly known as the Administrative Procedure Act ). Not later than 90 days before implementing any revision to the performance plan described in subparagraph (A), the Secretary shall consult with students, institutions of higher education, Congress, lenders, and other interested parties regarding such revision. ; in subparagraph (C)— in the matter preceding clause (i), by inserting and target dates upon which such action steps will be taken and such goals will be achieved after achieve such goals ; by redesignating clause
(v)as clause (vi); by inserting after clause
(iv)the following: Maximizing the transparency in the operations of the PBO, including complying with the data reporting requirements under section 144. ; in paragraph (2)— by striking 5-year and inserting 3-year ; in subparagraph (C), by inserting , including an explanation of the specific steps the Secretary and the Chief Operating Officer will take to address any such goals that were not achieved before the period; in subparagraph (D), by inserting , in the aggregate and per individual before the period; in subparagraph (E), by striking Recommendations and inserting Specific recommendations ; by redesignating subparagraph
(F)as subparagraph (G); and by inserting after subparagraph (E), the following: A description of the performance evaluation system developed under subsection (d)(6). . in paragraph (3)— in the matter preceding subparagraph (A), by striking establish appropriate means to ; in subparagraph (A), by striking ; and and inserting and the PBO; ; in subparagraph (B), by striking the period at the end and inserting and the PBO; and ; and by adding at the end the following: through a nationally-representative survey, that at a minimum shall evaluate the degree of satisfaction with the delivery system and the PBO. ; in subsection (d)— in paragraph (2), by striking The Secretary may reappoint and inserting Except as provided in paragraph (4)(C), in paragraph (4)— in subparagraph (A)— by inserting specific, after set forth ; and by inserting and metrics used to measure progress toward such goals before the period; by amending subparagraph
(B)to read as follows: The Secretary shall— transmit to the authorizing committees the final version of, and any subsequent revisions to, the agreement entered into under subparagraph (A); and before the expiration of the period of 5 business days beginning after the date on which the agreement is transmitted under clause (i), make such agreement publicly available on a publicly accessible website of the Department of Education. . by adding at the end the following: If the agreement under subparagraph
(A)is not made publicly available before the expiration of the period described in subparagraph (B)(ii), the Chief Operating Officer shall not be eligible for reappointment under paragraph (2). ; and in paragraph (5), by amending subparagraph
(B)to read as follows: In addition, the Chief Operating Officer may receive a bonus in the following amounts: For a period covered by a performance agreement entered into under paragraph
(4)before the date of the enactment of the PROSPER Act , an amount that does not exceed 50 percent of the annual rate basic pay of the Chief Operating Officer, based upon the Secretary’s evaluation of the Chief Operating Officer’s performance in relation to the goals set forth in the performance agreement. For a period covered by a performance agreement entered into under paragraph
(4)on or after the date of the enactment of the PROSPER Act , an amount that does not exceed 40 percent of the annual rate basic pay of the Chief Operating Officer, based upon the Secretary’s evaluation of the Chief Operating Officer’s performance in relation to the goals set forth in the performance agreement. . by adding at the end the following: The Secretary shall develop a system to evaluate the performance of the Chief Operating Officer and any senior managers appointed by such Officer under subsection (e). Such system shall— take into account the extent to which each individual attains the specific, measurable organizational and individual goals set forth in the performance agreement described in paragraph (4)(A) and subsection (e)(2) (as the case may be); and evaluate each individual using a rating system that accounts for the full spectrum of performance levels, from the failure of an individual to meet the goals described in clause
(i)to an individual’s success in meeting or exceeding such goals. ; in subsection (e)— in paragraph (2), by striking organization and individual goals and inserting specific, measurable organization and individual goals and the metrics used to measure progress toward such goals ; in paragraph (3), by amending subparagraph
(B)to read as follows: In addition, a senior manager may receive a bonus in the following amounts: For a period covered by a performance agreement entered into under paragraph
(2)before the date of the enactment of the PROSPER Act , an amount such that the manager’s total annual compensation does not exceed 125 percent of the maximum rate of basic pay for the Senior Executive Service, including any applicable locality-based comparability payment, based upon the Chief Operating Officer’s evaluation of the manager’s performance in relation to the goals set forth in the performance agreement. For a period covered by a performance agreement entered into under paragraph
(2)on or after the date of the enactment of the PROSPER Act , an amount such that the manager’s total annual compensation does not exceed 120 percent of the maximum rate of basic pay for the Senior Executive Service, including any applicable locality-based comparability payment, based upon the Chief Operating Officer’s evaluation of the manager’s performance in relation to the goals set forth in the performance agreement. . by redesignating subsections (f), (g), (h), and
(i)as subsections (g), (h), (i), (j); and by inserting after subsection
(e)the following: Not later than one year after the date of the enactment of the PROSPER Act , the Secretary shall establish an Advisory Board (referred to in this subsection as the Board ) for the PBO. The purpose of such Board shall be to conduct oversight over the PBO and the Chief Operating Officer and senior managers described under subsection
(e)to ensure that the PBO is meeting the purposes described in this section and the goals in the performance plan described under such section. The Board shall consist of 7 members, one of whom shall be the Secretary. A Chairman of the Board shall be elected by the Board from among its members for a 2-year term. The Secretary, ex officio— shall— serve as a member of the Board; be a voting member of the Board; and be eligible to be elected by the Board to serve as chairman or vice chairman of the Board; and shall not be subject to the terms or compensation requirements described in this paragraph that are applicable to the other members of the Board. Each member of the Board (excluding the Secretary) shall be appointed by the Secretary. Each Board member, except for the Secretary and the Board members described in clause (ii)(II), shall serve 5-year terms. The first 3 members confirmed to serve on the Board after the date of enactment of the PROSPER Act shall serve for 5-year terms. The fourth, fifth, and sixth members confirmed to serve on the Board after such date of enactment shall serve for 3-year terms. The Secretary may reappoint a Board member for one additional 5-year term. Not later than 30 days after a vacancy of the Board occurs, the Secretary shall publish a Federal Register notice soliciting nominations for the position. Not later than 90 days after such vacancy occurs, such vacancy shall be filled in the same manner as the original appointment was made, except that— the appointment shall be for the remainder of the uncompleted term; and such member may be reappointed under clause (iii). The members of the board, other than the Secretary, shall be appointed without regard to political affiliation and solely on the basis of their professional experience and expertise in— the management of large and financially significant organizations, including banks and commercial lending companies; or Federal student financial assistance programs. Before appointing members of the Board, the Secretary shall establish rules and procedures to address any potential conflict of interest between a member of the Board and responsibilities of the Board, including prohibiting membership for individuals with a pecuniary interest in the activities of the PBO. Board members shall serve without pay. Each member of the Board shall receive travel expenses and other permissible expenses, including per diem in lieu of subsistence, in accordance with applicable provisions under title 5, United States Code. The Board shall have the following responsibilities: Conducting general oversight over the functioning and operation of the PBO, including— ensuring that the reporting and planning requirements of this section are fulfilled by the PBO; and ensuring that the Chief Operating Officer acquires senior managers with demonstrated management ability and expertise in consumer lending (as described in subsection (b)(1)(C)(iii)). Approving the appointment or reappointment of a Chief Operating Officer, except that the board shall have no authority to approve or disapprove the reappointment of the Chief Operating Officer who holds such position on the date of enactment of the PROSPER Act . Making recommendations with respect to the suitability of any bonuses proposed to be provided to the Chief Operating Officer or senior managers described under subsections
(d)and (e), to ensure that a bonus is not awarded to the Officer or a senior manager in a case in which such Officer or manager has failed to meet goals set for them under the relevant performance plan under subsections (d)(4) and (e)(2), respectively. Approving any performance plan established for the PBO. The Board shall meet at least twice per year and at such other times as the chairperson determines appropriate. Except as otherwise provided by a majority vote of the Board, the powers of the chairperson shall include— establishing committees; setting meeting places and times; establishing meeting agendas; and developing rules for the conduct of business. Four members of the Board shall constitute a quorum. A majority of members present and voting shall be required for the Board to take action. The Federal Advisory Committee Act shall not apply with respect to the Board, other than sections 10, 11 and 12 of such Act. Not less frequently than once annually, the Board shall submit to the authorizing committees a report on the results of the work conducted by the PBO. Each report under clause
(i)shall include— a description of the oversight work of the Board and the results of such work; a description of statutory requirements of this section and section 144 where the PBO is not in compliance; recommendations on the appointment or reappointment of a Chief Operating Officer; recommendations regarding bonus payments for the Chief Operating Officer and senior managers; and recommendations for the authorizing Committees and the Appropriations Committees on— any statutory changes needed that would enhance the ability of the PBO to meet the purposes of this section; and any recommendations for the Secretary or the Chief Operating Officer that will improve the operations of the PBO. Each report under clause
(i)shall be posted on the publicly accessible website of the Department of Education. Not later than 180 days after the submission of each report under clause (i), the Chief Operating Officer shall respond to each recommendation individually, which shall include a description of such actions that the Officer is undertaking to address such recommendation. The Secretary may appoint to the Board not more than 7 employees to assist in carrying out the duties of the Board under this section. Such appointments may include, for terms not to exceed 3 years and without regard to the provisions of title 5, United States Code, governing appointments in the competitive service, not more than 3 technical employees who may be paid without regard to the provisions of chapter 51 and subchapter III of chapter 53 of such title relating to classification and General Schedule pay rates, but no individual so appointed shall be paid in excess of the rate authorized for GS–18 of the General Schedule. The Secretary may detail, on a reimbursable basis, any of the personnel of the Department for the purposes described in clause (i). Such employees shall serve without additional pay, allowances, or benefits. Nothing in this subparagraph shall be construed to provide for an increase in the total number of permanent full-time equivalent positions in the Department or any other department or agency of the Federal Government. The Secretary shall, upon request, provide a briefing to the authorizing committees on the steps the Board has taken to carry out its responsibilities under this subsection. .
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Sec. 131
Performance-based organization for the delivery of Federal student financial assistance
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