Sec. 1031. Improvements to the Federal student aid office
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Section 141 of the Higher Education Act of 1965 ( 20 U.S.C. 1018 ) is amended— in subsection (a), by amending paragraph
(2)to read as follows: The purposes of the PBO are as follows: To prioritize students and borrowers in the decision-making processes related to all aspects of the management and administration of the Federal student financial assistance programs authorized under title IV. To improve service to students and other participants in the Federal student financial assistance programs authorized under title IV. To make such programs more understandable to students and their families. To increase the efficiency and effectiveness of such programs for students and their families. To manage the costs of administering such programs. To increase the accountability of the officials responsible for administering the operational aspects of such programs. To oversee institutions, contractors, and third party servicers that participate in the Federal student financial assistance programs authorized under title IV. To provide greater flexibility in the management and administration of such programs. To implement open, common, integrated systems for the delivery of Federal student financial assistance programs authorized under title IV. To develop and maintain a student financial assistance system that contains complete, accurate, and timely data to ensure program integrity. To increase transparency in the operations and outcomes of Federal student financial assistance programs authorized under title IV. ; in subsection (b)— in paragraph (1)— by redesignating subparagraphs
(B)and
(C)as subparagraphs
(C)and (D), respectively; and by inserting after subparagraph
(A)the following: implement oversight and accountability measures to ensure that the PBO carries out its duties under this section efficiently, effectively, and in a manner that accomplishes the purposes specified in subsection (a)(2); ; in paragraph (2)(A)— by redesignating clauses
(ii)through
(vi)as clauses
(iii)through (vii); by inserting after clause
(i)the following: in accordance with paragraph (3), the collection, publication, and sharing of aggregate and longitudinal data that may be used to evaluate Federal student financial assistance programs authorized under title IV, including the outcomes such programs achieve; ; and in clause (vii), as so redesignated, by inserting , including oversight of institutions, contractors, and third party servicers that participate in such programs after title IV ; by redesignating paragraphs
(3)through
(6)as paragraphs
(4)through (7), respectively; and by inserting after paragraph
(2)the following: The PBO shall collect student-level data that shall be used to evaluate Federal student financial assistance programs authorized under title IV. The PBO shall make the data collected under subparagraph
(A)available to the Commissioner of the National Center for Education Statistics for purposes of research and policy analysis. The Commissioner of the National Center for Education Statistics shall ensure the data shared under subparagraph
(B)is made available, with direct identifiers removed and with appropriate restrictions to ensure data privacy and security, for vetted research and evaluation purposes in a manner consistent with the process under section 132(l)(5)(A)(i). Not less frequently than once annually, and subject to clause (ii), the PBO shall make the data collected under subparagraph
(A)available on a publicly accessible website of the Department of Education in a format that enables members of the public to easily retrieve, sort, and analyze the data. The data made available under clause
(i)shall not include— student-level data; or any data that would reveal personally identifiable information about an individual student. . by amending subsection
(c)to read as follows: Not later than one year after the date of the enactment of the College Affordability Act , and not less than once every five years thereafter, the Secretary and Chief Operating Officer shall agree on a performance plan for the PBO for the succeeding 5 years that— establishes measurable quantitative and qualitative goals and objectives for the organization; and aligns such goals and objectives with the purposes specified in subsection (a)(2). In developing the five-year performance plan and any revision to the plan, the Secretary and the Chief Operating Officer shall consult with students, institutions, Congress, contractors, the Borrower Advocate, student aid experts, including consumer advocacy and research groups, the Director of the Bureau of Consumer Financial Protection, State attorneys general, and other relevant parties. The Secretary and Chief Operating Officer may annually update the plan under paragraph
(1)to incorporate the recommendations made pursuant to the consultation required under subparagraph
(B)that are accepted by the Secretary and the Chief Operating Officer. The plan developed under subparagraph
(A)shall address the responsibilities of the PBO in the following areas: Improving service to students and other participants in the Federal student financial assistance programs authorized under title IV, including making those programs more understandable and accessible to students and their families. Managing the costs and increasing the efficiency of such programs. Improving, integrating, and investing in the systems that support such programs. Developing open, common, and integrated systems for such programs. The collection, publication, and sharing of data on such programs as described in subsection (b)(3). Improving performance standards and outcomes with respect to institutions, contractors, and third party servicers that act as agents of the Department or as agents of institutions that participate in such programs. Any other areas identified by the Secretary. Each plan developed under subparagraph
(A)shall be made available on a publicly accessible website of the Department of Education. Not later than one year after the date of the enactment of the College Affordability Act and annually thereafter, the Secretary, acting through the Chief Operating Officer, shall submit to Congress an annual report on the performance of the PBO. The annual report shall include the following: An evaluation of the extent to which the PBO met the goals and objectives contained in the five-year performance plan described in paragraph
(1)for the preceding year. A summary of the consultation process under paragraph (1)(B) for the preceding year, including the recommendations that were accepted or denied by the Chief Operating Officer during such year, and the rationale for accepting or denying such recommendations. An independent financial audit of the expenditures of both the PBO and the programs administered by the PBO. A summary of the actions taken by the PBO to address— the findings of the audit described in clause (iii); and consumer feedback. Financial and performance requirements applicable to the PBO under— the Chief Financial Officers Act of 1990 ( Public Law 101–576 ); or the Government Performance and Results Act of 1993 ( Public Law 103–62 ). The results achieved by the PBO during the preceding year and whether such results met the goals specified in the performance plan under paragraph (1). With respect to the preceding year, the evaluation rating of the performance of the Chief Operating Officer and senior managers under subsections (d)(5) and (e)(2), including the amounts of bonus compensation awarded to the Chief Operating Officer and senior managers. Recommendations for legislative and regulatory changes to improve service to students and their families, and to improve the efficiency and integrity of Federal student financial assistance programs authorized under title IV. Financial statements that provide a rationale for appropriately funding the activities of the PBO. A summary of the management and compliance of contractors managed by the PBO in the preceding year, including corrective actions taken by the PBO with respect to such contractors. A description of how the PBO used the authority under paragraph
(5)of subsection
(b)for making personnel and procurement decisions in the preceding year, including the number of individuals hired through such authority and the bonuses provided to staff during such year. A summary of the oversight activities of institutions, contractors, and third party servicers that participate in the Federal student financial assistance programs authorized under title IV including— fines levied on such institutions, contractors, and third party servicers, disaggregated by entity; instances of fraud or misrepresentation by such institutions, contractors, or third party servicers; and violations of provisions in this Act by such institutions, contractors, or third party servicers disaggregated by entity and type of violation. A summary of any improvements made with respect to transparency and any new types of data made available in the preceding year. A description of the progress made in the preceding year towards the specific measurable organization and individual goals specified in subsection (d)(5)(A). The report submitted to the Secretary under subsection (f)(7). Other such information as the Director of the Office of Management and Budget shall prescribe for performance based organizations. The Chief Operating Officer, in preparing the annual report described in paragraph (2), shall establish appropriate means to consult with students, borrowers, institutions, student aid experts, including consumer advocacy and research groups, the Director of the Bureau of Consumer Financial Protection, and others involved in the delivery and evaluation of student aid under title IV— regarding the degree of satisfaction with the delivery system; and to seek suggestions on means to improve the performance of the delivery system. The Secretary shall, at the request of the authorizing committees, provide to the authorizing committees a briefing on the steps the Department of Education has taken to ensure— the experiences of students and borrowers are accounted for in decision making; and that contractors, lenders, and guaranty agencies and third party servicers are adhering to the requirements of title IV, the terms of any contract with the Secretary, consumer protection laws, Federal regulations and guidelines, and directives of the PBO. Not later than 180 days after the date of the enactment of the College Affordability Act , the Secretary shall enter into a memorandum of understanding with the Private Education Loan Ombudsman in accordance with section 1035(c)(2) of the Dodd-Frank Wall Street Reform and Consumer Protection Act ( 12 U.S.C. 5535(c)(2) ). . in subsection (d)— in paragraph (1), by striking management ability and all that follows through the period at the end and inserting management ability, including contractor management, expertise in the Federal student financial assistance programs authorized under title IV, experience with financial systems, and knowledge of consumer financial protection laws, and without regard to political affiliation or activity. ; by redesignating paragraphs
(2)through
(5)as paragraphs
(3)through (6); by inserting after paragraph
(1)the following: An individual may not serve as the Chief Operating Officer if such individual— is employed by, or has a financial interest in, an entity that contracts with the PBO; or was employed by, or had a financial interest in, any such entity in any of the five years preceding the date of the individual’s appointment as the Chief Operating Officer. An individual who served as the Chief Operating Officer may not accept employment with an entity that contracts with the PBO until a period of five years has elapsed following the date on which such individual’s service as the Chief Operating Officer terminated. ; in paragraph (5), as so redesignated— in subparagraph (A)— by inserting specific before measurable ; and by inserting and metrics used to measure progress toward such goals before the period; and in subparagraph (B), by inserting on the website of the Department before the period; and in paragraph (6), as so redesignated, by amending subparagraph
(B)to read as follows: The Secretary may pay to the Chief Operating Officer a bonus in an amount that does not exceed 50 percent of such annual rate of basic pay. The decision to pay such a bonus, and the amount of the bonus, shall be based solely on the Secretary’s evaluation of the performance of the Chief Operating Officer with respect to the goals set forth in the performance agreement as described in paragraph (5)(A). ; in subsection (e)(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. Performance agreements for senior management responsible for procurement shall include metrics that measure ability to oversee contractors. ; by amending subsection
(f)to read as follows: There is established in the PBO an Office of the Borrower Advocate (referred to in this subsection as the Office ). The function of the Office shall be to provide timely assistance to borrowers of loans made, insured, or guaranteed under title IV by performing the duties described in paragraph (6). There shall be an official known as the Borrower Advocate who shall serve as the head of the Office. The Borrower Advocate shall be appointed by the Secretary from among individuals who have worked closely with the Federal student loan programs authorized under title IV. The Borrower Advocate may be removed only by the Secretary who shall communicate the reasons for any such removal to the authorizing committees. An individual may not serve as the Borrower Advocate if such individual— is employed by, or has a financial interest in, an entity that contracts with the PBO; or was employed by, or had a financial interest in, any such entity in any of the five years preceding the date of the individual’s appointment as the Borrower Advocate. An individual who served as the Borrower Advocate may not accept employment with an entity that contracts with the PBO until a period of five years has elapsed following the date on which such individual’s service as the Borrower Advocate terminated. The Office shall be staffed sufficiently to carry out the responsibilities of the Office under this subsection. The Office of the Borrower Advocate shall— assist borrowers of loans made, insured, or guaranteed under title IV in resolving problems with the PBO and its contractors or other agents, including by— receiving and reviewing complaints of such problems from borrowers; working to resolve such complaints in a manner that is in the best interests of borrowers; and transmitting such complaints to States and recognized accrediting agencies or associations, as appropriate. attempt to resolve complaints within the Department of Education and with institutions of higher education, lenders, guaranty agencies, loan servicers, and other participants in the Federal student loan programs authorized under title IV in a manner that will improve the experience of the borrower; conduct impartial reviews regarding a student’s independence under subparagraph
(B)or
(H)of section 480(d)(1), in consultation with knowledgeable parties, including institutions of higher education, child welfare agencies, local educational agency liaisons for homeless individuals designated under section 722(g)(1)(J)(ii) of the McKinney-Vento Homeless Assistance Act ( 42 U.S.C. 11432(g)(1)(J)(ii) ), or State Coordinators for Education of Homeless Children and Youth established in accordance with section 722 of such Act ( 42 U.S.C. 11432 ); compile and analyze data on borrower complaints and share such data with the Director of the Bureau of Consumer Financial Protection; publish, with any personally identifiable information redacted, such complaints and responses of the Secretary to such complaints on the website of the Department; and make appropriate recommendations to Congress, the Chief Operating Officer, and Secretary with respect to Federal student loan programs authorized under title IV and the experiences of borrowers in repayment of loans under such programs. The Chief Operating Officer shall establish and maintain a public page on the website of the Department of Education exclusively to provide members of the public with information about the role of the PBO with respect to the oversight of institutions of higher education, lenders, guaranty agencies, contractors that contract with the PBO, subcontractors of such contractors, and third party servicers. On an annual basis, the Borrower Advocate shall submit to the Chief Operating Officer a report on the activities of the Office during the preceding year that— identifies the activities carried out by the Borrower Advocate; summarizes the complaints received from borrowers, including the number of such complaints, and explains the activities undertaken by the PBO to address such complaints; proposes changes in the administrative practices of the PBO to mitigate problems experienced by borrowers; and identifies potential legislative changes which may be appropriate to mitigate such problems. ; by redesignating subsection
(i)as subsection (k); and by inserting after subsection
(h)the following: Not later than 180 days after the date of enactment of the College Affordability Act , the Secretary shall establish within the PBO an enforcement unit (referred to in this section as the Unit ) to review and investigate violations of this Act and recommend enforcement actions in accordance with paragraph (3). The Secretary shall appoint an official to be known as the Chief Enforcement Officer who shall serve as the head of the Unit. The Secretary shall appoint an individual to serve as the Chief Enforcement Officer solely on the basis of such individual’s integrity and expertise in law and investigations and without regard to such individual’s political affiliation. The Chief Enforcement Officer shall report directly to the Secretary without being required to report through any other official of the Department of Education. The Chief Enforcement Officer shall be appointed for a term of 6 years and may be reappointed for additional terms of 6 years at the discretion of the Secretary. The Chief Enforcement Officer may not be removed during the Officer’s term except for cause. If the Secretary removes the Chief Enforcement Officer before the expiration of the Officer’s term, the Secretary shall submit to the authorizing committees a report that explains the reasons for such removal. The report shall be submitted to the authorizing committees not later than 30 days after the date on which the removal takes effect. The Chief Enforcement Officer shall have the following duties: Receive, process, and analyze allegations that a covered entity has violated Federal law or has engaged in unfair, deceptive, or abusive practices. Review and investigate such allegations or refer such allegations to an entity described in subparagraphs
(A)through
(E)of paragraph (6). After reviewing and investigating an allegation under subparagraph (B), in consultation with the Chief Operating Officer— if the covered entity subject to such allegation is an entity described in clause
(i)or
(iii)of paragraph (8)(A), make recommendations with respect to such covered entity, including— whether such covered entity should be limited, suspended, or terminated from participation in one or more programs under title IV; whether such covered entity should be subject to an emergency action under section 487(c)(1)(G); whether such covered entity should be subject to a civil penalty described in section 487(c)(3)(B); whether such covered entity should be subject to a criminal penalty described in section 490; or whether such covered entity should be subject to a combination of any of the actions described in subclauses
(I)though (IV); if the covered entity subject to such allegation is an entity described in clause
(ii)of paragraph (8)(A), make recommendations with respect to such covered entity, including whether such covered entity should be limited, suspended, or terminated from administering or providing services with respect to one or more programs under title IV; and provide the Secretary with such recommendations. After receiving notice of a determination of the Chief Enforcement Officer under paragraph (3)(C), the Secretary shall decide whether or not to pursue enforcement action against the entity concerned, in accordance with the procedures established under section 487(c)(3). In a case in which the Chief Enforcement Officer recommends enforcement action against an entity, but the Secretary decides not to pursue such enforcement action, the Secretary shall notify the Chief Enforcement Officer, in writing, of the rationale for such decision. The Chief Enforcement Officer shall— coordinate with relevant Federal and State agencies and oversight bodies; and hire staff with the expertise necessary to conduct investigations, respond to allegations against covered entities, and enforce compliance with laws governing Federal student financial assistance programs under title IV. The Chief Enforcement Officer shall develop and implement a process for sharing relevant information about allegations against covered entities with— the Borrower Advocate appointed under subsection (f); personnel of the Department responsible for processing borrower defense claims submitted under section 493H; other relevant Federal agencies; States, including State law enforcement and regulatory agencies; and recognized accrediting agencies or associations. On an annual basis, the Chief Enforcement Officer shall submit to the authorizing committees a report that includes— the number of allegations about covered entities received by Unit in the year covered by the report; the number of such allegations investigated by the Unit; the number of such allegations that were referred to the Secretary under paragraph (3)(C) and a summary of any action taken by the Secretary with respect to such allegations; the number of such allegations that were referred to other Federal agencies and the names of the agencies to which the allegations were referred; and the number of such allegations that remain under review or investigation as of the date of the report. In this subsection: In this subsection, the term covered entity means— an institution of higher education (as defined in section 102) that participates in the Federal student financial assistance programs authorized under title IV; a contractor that contracts with the PBO to provide services relating to such programs, or a subcontractor of such contractor; or a third party servicer. the term third party servicer has the meaning given that term in section 481(c). .
Connectionstraces to 3
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- Pub. L. 101-576
- Pub. L. 103-62
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Sec. 1031
Improvements to the Federal student aid office
Pub. L.Pub. L. 101-576
Pub. L.Pub. L. 103-62
Cites 5Cited by 0 across 0 sources