For historical purposes, this is the original text of the law, without any subsequent amendments. For the current texts of the laws we enforce, as amended, see Laws Enforced by the EEOC.

An Act

To extend the authorization of programs under the Higher Education Act of 1965, and for other purposes.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

(a) SHORT TITLE- This Act may be cited as the `Higher Education Amendments of 1998'.

(b) TABLE OF CONTENTS- The table of contents is as follows:

Sec. 1. Short title; table of contents.

Sec. 2. References.

Sec. 3. General effective date.

TITLE I--GENERAL PROVISIONS

Sec. 101. Revision of title I.

Sec. 102. Conforming amendments.

TITLE II--TEACHER QUALITY

Sec. 201. Teacher quality enhancement grants.

TITLE III--INSTITUTIONAL AID

Sec. 301. Transfers and redesignations.

Sec. 302. Findings.

Sec. 303. Strengthening institutions.

Sec. 304. Strengthening HBCU's.

Sec. 305. Endowment challenge grants.

Sec. 306. HBCU capital financing.

Sec. 307. Minority science and engineering improvement program.

Sec. 308. General provisions.

TITLE IV--STUDENT ASSISTANCE

Part A--Grants to Students

Sec. 401. Federal Pell Grants.

Sec. 402. Federal TRIO programs.

Sec. 403. Gear up program.

Sec. 404. Academic achievement incentive scholarships.

Sec. 405. Repeals.

Sec. 406. Federal supplemental educational opportunity grants.

Sec. 407. Leveraging educational assistance partnership program.

Sec. 408. Special programs for students whose families are engaged in migrant and seasonal farmwork.

Sec. 409. Robert C. Byrd Honors Scholarship Program.

Sec. 410. Child care access means parents in school.

Sec. 410A. Learning anytime anywhere partnerships.

Part B--Federal Family Education Loan Program

Sec. 411. Limitation repealed.

Sec. 412. Advances to reserve funds.

Sec. 413. Guaranty agency reforms.

Sec. 414. Scope and duration of Federal loan insurance program.

Sec. 415. Limitations on individual federally insured loans and Federal loan insurance.

Sec. 416. Applicable interest rates.

Sec. 417. Federal payments to reduce student interest costs.

Sec. 418. Voluntary flexible agreements with guaranty agencies.

Sec. 419. Federal PLUS loans.

Sec. 420. Federal consolidation loans.

Sec. 421. Default reduction program.

Sec. 422. Requirements for disbursements of student loans.

Sec. 423. Unsubsidized loans.

Sec. 424. Loan forgiveness for teachers.

Sec. 425. Loan forgiveness for child care providers.

Sec. 426. Notice to Secretary and payment of loss.

Sec. 427. Legal powers and responsibilities.

Sec. 428. Student loan information by eligible lenders.

Sec. 429. Definitions.

Sec. 430. Delegation of functions.

Sec. 431. Discharge.

Sec. 432. Debt management options.

Sec. 433. Special allowances.

Sec. 434. Federal family education loan insurance fund.

Part C--Federal Work-study Programs

Sec. 441. Authorization of appropriations; community services.

Sec. 442. Allocation of funds.

Sec. 443. Grants for Federal work-study programs.

Sec. 444. Flexible use of funds.

Sec. 445. Work colleges.

Part D--William D. Ford Federal Direct Loan Program

Sec. 451. Selection of institutions.

Sec. 452. Terms and conditions.

Sec. 453. Contracts.

Sec. 454. Funds for administrative expenses.

Sec. 455. Authority to sell loans.

Sec. 456. Loan cancellation for teachers.

Part E--Federal Perkins Loans

Sec. 461. Authorization of appropriations.

Sec. 462. Allocation of funds.

Sec. 463. Agreements with institutions of higher education.

Sec. 464. Terms of loans.

Sec. 465. Cancellation for public service.

Sec. 466. Distribution of assets from student loan funds.

Sec. 467. Perkins Loan Revolving Fund.

Part F--Need Analysis

Sec. 471. Cost of attendance.

Sec. 472. Data elements.

Sec. 473. Family contribution for dependent students.

Sec. 474. Family contribution for independent students without dependents other than a spouse.

Sec. 475. Family contribution for independent students with dependents other than a spouse.

Sec. 476. Regulations; updated tables and amounts.

Sec. 477. Simplified needs test; zero expected family contribution.

Sec. 478. Discretion of student financial aid administrators.

Sec. 479. Treatment of other financial assistance.

Sec. 480. Clerical amendments.

Sec. 480A. Effective dates.

Part G--General Provisions

Sec. 481. Master calendar.

Sec. 482. Forms and regulations.

Sec. 483. Student eligibility.

Sec. 484. State court judgments.

Sec. 485. Institutional refunds.

Sec. 486. Institutional and financial assistance information for students.

Sec. 487. National student loan data system.

Sec. 488. Distance education demonstration programs.

Sec. 489. Program participation agreements.

Sec. 490. Regulatory relief and improvement.

Sec. 490A. Garnishment requirements.

Sec. 490B. Administrative subpoena authority.

Sec. 490C. Advisory Committee on Student Financial Assistance.

Sec. 490D. Meetings and negotiated rulemaking.

Sec. 490E. Year 2000 requirements at the Department of Education.

Sec. 490F. Procedures for cancellations and deferments for eligible disabled veterans.

Part H--Program Integrity

Sec. 491. State role and responsibilities.

Sec. 492. Accrediting agency recognition.

Sec. 493. Eligibility and certification procedures.

Sec. 494. Program review and data.

Sec. 495. Review of regulations.

TITLE V--DEVELOPING INSTITUTIONS

Sec. 501. Establishment of new title V.

TITLE VI--INTERNATIONAL EDUCATION PROGRAMS

Sec. 601. International and foreign language studies.

Sec. 602. Business and international education programs.

Sec. 603. Institute for International Public Policy.

Sec. 604. General provisions.

TITLE VII--GRADUATE AND POSTSECONDARY IMPROVEMENT PROGRAMS

Sec. 701. Revision of title VII.

Sec. 702. Repeals.

TITLE VIII--STUDIES, REPORTS, AND RELATED PROGRAMS

Part A--Studies

Sec. 801. Study of market mechanisms in Federal student loan programs.

Sec. 802. Study of the feasibility of alternative financial instruments for determining lender yields.

Sec. 803. Student-related debt study required.

Sec. 804. Study of transfer of credits.

Sec. 805. Study of opportunities for participation in athletics programs.

Sec. 806. Study of the effectiveness of cohort default rates for institutions with few student loan borrowers.

Part B--Advanced Placement Incentive Program

Sec. 810. Advanced placement incentive program.

Part C--Community Scholarship Mobilization

Sec. 811. Short title.

Sec. 812. Findings.

Sec. 813. Definitions.

Sec. 814. Purpose; endowment grant authority.

Sec. 815. Grant agreement and requirements.

Sec. 816. Authorization of appropriations.

Part D--Grants to States for Workplace and Community Transition Training for Incarcerated Youth Offenders

Sec. 821. Grants to States for workplace and community transition training for incarcerated youth offenders.

Part E--Grants to Combat Violent Crimes Against Women on Campuses

Sec. 826. Grants to combat violent crimes against women on campuses.

Sec. 827. Study of institutional procedures to report sexual assaults.

Part F--Improving United States Understanding of Science, Engineering, and Technology in East Asia

Sec. 831. Improving United States understanding of science, engineering, and technology in East Asia.

Part G--Olympic Scholarships

Sec. 836. Extension of authorization.

Part H--Underground Railroad

Sec. 841. Underground Railroad educational and cultural program.

Part I--Summer Travel and Work Programs

Sec. 846. Authority to administer summer travel and work programs.

Part J--Web-based Education Commission

Sec. 851. Short title; definitions.

Sec. 852. Establishment of Web-Based Education Commission.

Sec. 853. Duties of the Commission.

Sec. 854. Powers of the Commission.

Sec. 855. Commission personnel matters.

Sec. 856. Termination of the Commission.

Sec. 857. Authorization of appropriations.

Part K--Miscellaneous

Sec. 861. Education-welfare study.

Sec. 862. Release of conditions, covenants, and reversionary interests, Guam Community College conveyance, Barrigada, Guam.

Sec. 863. Sense of Congress regarding good character.

Sec. 864. Educational merchandise licensing codes of conduct.

TITLE IX--AMENDMENTS TO OTHER LAWS

Part A--Extension and Revision of Indian Higher Education Programs

Sec. 901. Tribally controlled colleges and universities.

Sec. 902. Reauthorization of Navajo Community College Act.

Part B--Education of the Deaf

Sec. 911. Short title.

Sec. 912. Elementary and secondary education programs.

Sec. 913. Agreement with Gallaudet University.

Sec. 914. Agreement for the National Technical Institute for the Deaf.

Sec. 915. Definitions.

Sec. 916. Gifts.

Sec. 917. Reports.

Sec. 918. Monitoring, evaluation, and reporting.

Sec. 919. Federal endowment programs.

Sec. 920. Scholarship program.

Sec. 921. Oversight and effect of agreements.

Sec. 922. International students.

Sec. 923. Research priorities.

Sec. 924. National Study on the Education of the Deaf.

Sec. 925. Authorization of appropriations.

Part C--United States Institute of Peace

Sec. 931. Authorities of the United States Institute of Peace.

Part D--Voluntary Retirement Incentive Plans

Sec. 941. Voluntary retirement incentive plans.

Part E--General Education Provisions Act Amendment

Sec. 951. Amendment to Family Educational Rights and Privacy Act of 1974.

Sec. 952. Alcohol or drug possession disclosure.

Part F--Liaison for Proprietary Institutions of Higher Education

Sec. 961. Liaison for proprietary institutions of higher education.

Part G--Amendments to Other Statutes

Sec. 971. Nondischareability of certain claims for educational benefits provided to obtain higher education.

Sec. 972. GNMA guarantee fee.

Part H--Repeals

Sec. 981. Repeals.

Sec. 982. Repeals of previous higher education amendments provisions.

SEC. 2. REFERENCES.

Except as otherwise expressly provided, whenever in this Act an amendment or repeal is expressed in terms of an amendment to, or repeal of, a section or other provision, the reference shall be considered to be made to a section or other provision of the Higher Education Act of 1965 (20 U.S.C. 1001 et seq.).

SEC. 3. GENERAL EFFECTIVE DATE.

Except as otherwise provided in this Act or the amendments made by this Act, the amendments made by this Act shall take effect on October 1, 1998.

SEC. 101. REVISION OF TITLE I.

(a) GENERAL PROVISIONS- Title I (20 U.S.C. 1001 et seq.) is amended to read as follows:

`PART A--DEFINITIONS

`SEC. 101. GENERAL DEFINITION OF INSTITUTION OF HIGHER EDUCATION.

`(a) INSTITUTION OF HIGHER EDUCATION- For purposes of this Act, other than title IV, the term `institution of higher education' means an educational institution in any State that--

`(1) admits as regular students only persons having a certificate of graduation from a school providing secondary education, or the recognized equivalent of such a certificate;

`(2) is legally authorized within such State to provide a program of education beyond secondary education;

`(3) provides an educational program for which the institution awards a bachelor's degree or provides not less than a 2-year program that is acceptable for full credit toward such a degree;

`(4) is a public or other nonprofit institution; and

`(5) is accredited by a nationally recognized accrediting agency or association, or if not so accredited, is an institution that has been granted preaccreditation status by such an agency or association that has been recognized by the Secretary for the granting of preaccreditation status, and the Secretary has determined that there is satisfactory assurance that the institution will meet the accreditation standards of such an agency or association within a reasonable time.

`(b) ADDITIONAL INSTITUTIONS INCLUDED- For purposes of this Act, other than title IV, the term `institution of higher education' also includes--

`(1) any school that provides not less than a 1-year program of training to prepare students for gainful employment in a recognized occupation and that meets the provision of paragraphs (1), (2), (4), and (5) of subsection (a); and

`(2) a public or nonprofit private educational institution in any State that, in lieu of the requirement in subsection (a)(1), admits as regular students persons who are beyond the age of compulsory school attendance in the State in which the institution is located.

`(c) LIST OF ACCREDITING AGENCIES- For purposes of this section and section 102, the Secretary shall publish a list of nationally recognized accrediting agencies or associations that the Secretary determines, pursuant to subpart 2 of part H of title IV, to be reliable authority as to the quality of the education or training offered.

`SEC. 102. DEFINITION OF INSTITUTION OF HIGHER EDUCATION FOR PURPOSES OF TITLE IV PROGRAMS.

`(a) DEFINITION OF INSTITUTION OF HIGHER EDUCATION FOR PURPOSES OF TITLE IV PROGRAMS-

`(1) INCLUSION OF ADDITIONAL INSTITUTIONS- Subject to paragraphs (2) through (4) of this subsection, the term `institution of higher education' for purposes of title IV includes, in addition to the institutions covered by the definition in section 101--

`(A) a proprietary institution of higher education (as defined in subsection (b) of this section);

`(B) a postsecondary vocational institution (as defined in subsection (c) of this section); and

`(C) only for the purposes of part B of title IV, an institution outside the United States that is comparable to an institution of higher education as defined in section 101 and that has been approved by the Secretary for the purpose of part B of title IV.

`(2) INSTITUTIONS OUTSIDE THE UNITED STATES-

`(A) IN GENERAL- For the purpose of qualifying as an institution under paragraph (1)(C), the Secretary shall establish criteria by regulation for the approval of institutions outside the United States and for the determination that such institutions are comparable to an institution of higher education as defined in section 101. In the case of a graduate medical or veterinary school outside the United States, such criteria shall include a requirement that a student attending such school outside the United States is ineligible for loans made, insured, or guaranteed under part B unless--

`(i)(I) at least 60 percent of those enrolled in, and at least 60 percent of the graduates of, the graduate medical school outside the United States were not persons described in section 484(a)(5) in the year preceding the year for which a student is seeking a loan under part B of title IV; and

`(II) at least 60 percent of the individuals who were students or graduates of the graduate medical school outside the United States (both nationals of the United States and others) taking the examinations administered by the Educational Commission for Foreign Medical Graduates received a passing score in the year preceding the year for which a student is seeking a loan under part B of title IV; or

`(ii) the institution has a clinical training program that was approved by a State as of January 1, 1992, or the institution's students complete their clinical training at an approved veterinary school located in the United States.

`(B) ADVISORY PANEL-

`(i) IN GENERAL- For the purpose of qualifying as an institution under paragraph (1)(C) of this subsection, the Secretary shall establish an advisory panel of medical experts that shall--

`(I) evaluate the standards of accreditation applied to applicant foreign medical schools; and

`(II) determine the comparability of those standards to standards for accreditation applied to United States medical schools.

`(ii) SPECIAL RULE- If the accreditation standards described in clause (i) are determined not to be comparable, the foreign medical school shall be required to meet the requirements of section 101.

`(C) FAILURE TO RELEASE INFORMATION- The failure of an institution outside the United States to provide, release, or authorize release to the Secretary of such information as may be required by subparagraph (A) shall render such institution ineligible for the purpose of part B of title IV.

`(D) SPECIAL RULE- If, pursuant to this paragraph, an institution loses eligibility to participate in the programs under title IV, then a student enrolled at such institution may, notwithstanding such loss of eligibility, continue to be eligible to receive a loan under part B while attending such institution for the academic year succeeding the academic year in which such loss of eligibility occurred.

`(3) LIMITATIONS BASED ON COURSE OF STUDY OR ENROLLMENT- An institution shall not be considered to meet the definition of an institution of higher education in paragraph (1) if such institution--

`(A) offers more than 50 percent of such institution's courses by correspondence, unless the institution is an institution that meets the definition in section 521(4)(C) of the Carl D. Perkins Vocational and Applied Technology Education Act;

`(B) enrolls 50 percent or more of the institution's students in correspondence courses, unless the institution is an institution that meets the definition in such section, except that the Secretary, at the request of such institution, may waive the applicability of this subparagraph to such institution for good cause, as determined by the Secretary in the case of an institution of higher education that provides a 2- or 4-year program of instruction (or both) for which the institution awards an associate or baccalaureate degree, respectively;

`(C) has a student enrollment in which more than 25 percent of the students are incarcerated, except that the Secretary may waive the limitation contained in this subparagraph for a nonprofit institution that provides a 2- or 4-year program of instruction (or both) for which the institution awards a bachelor's degree, or an associate's degree or a postsecondary diploma, respectively; or

`(D) has a student enrollment in which more than 50 percent of the students do not have a secondary school diploma or its recognized equivalent, and does not provide a 2- or 4-year program of instruction (or both) for which the institution awards a bachelor's degree or an associate's degree, respectively, except that the Secretary may waive the limitation contained in this subparagraph if a nonprofit institution demonstrates to the satisfaction of the Secretary that the institution exceeds such limitation because the institution serves, through contracts with Federal, State, or local government agencies, significant numbers of students who do not have a secondary school diploma or its recognized equivalent.

`(4) LIMITATIONS BASED ON MANAGEMENT- An institution shall not be considered to meet the definition of an institution of higher education in paragraph (1) if--

`(A) the institution, or an affiliate of the institution that has the power, by contract or ownership interest, to direct or cause the direction of the management or policies of the institution, has filed for bankruptcy, except that this paragraph shall not apply to a nonprofit institution, the primary function of which is to provide health care educational services (or an affiliate of such an institution that has the power, by contract or ownership interest, to direct or cause the direction of the institution's management or policies) that files for bankruptcy under chapter 11 of title 11, United States Code, between July 1, 1998, and December 1, 1998; or

`(B) the institution, the institution's owner, or the institution's chief executive officer has been convicted of, or has pled nolo contendere or guilty to, a crime involving the acquisition, use, or expenditure of funds under title IV, or has been judicially determined to have committed fraud involving funds under title IV.

`(5) CERTIFICATION- The Secretary shall certify an institution's qualification as an institution of higher education in accordance with the requirements of subpart 3 of part H of title IV.

`(6) LOSS OF ELIGIBILITY- An institution of higher education shall not be considered to meet the definition of an institution of higher education in paragraph (1) if such institution is removed from eligibility for funds under title IV as a result of an action pursuant to part H of title IV.

`(b) PROPRIETARY INSTITUTION OF HIGHER EDUCATION-

`(1) PRINCIPAL CRITERIA- For the purpose of this section, the term `proprietary institution of higher education' means a school that--

`(A) provides an eligible program of training to prepare students for gainful employment in a recognized occupation;

`(B) meets the requirements of paragraphs (1) and (2) of section 101(a);

`(C) does not meet the requirement of paragraph (4) of section 101(a);

`(D) is accredited by a nationally recognized accrediting agency or association recognized by the Secretary pursuant to part H of title IV;

`(E) has been in existence for at least 2 years; and

`(F) has at least 10 percent of the school's revenues from sources that are not derived from funds provided under title IV, as determined in accordance with regulations prescribed by the Secretary.

`(2) ADDITIONAL INSTITUTIONS- The term `proprietary institution of higher education' also includes a proprietary educational institution in any State that, in lieu of the requirement in paragraph (1) of section 101(a), admits as regular students persons who are beyond the age of compulsory school attendance in the State in which the institution is located.

`(c) POSTSECONDARY VOCATIONAL INSTITUTION-

`(1) PRINCIPAL CRITERIA- For the purpose of this section, the term `postsecondary vocational institution' means a school that--

`(A) provides an eligible program of training to prepare students for gainful employment in a recognized occupation;

`(B) meets the requirements of paragraphs (1), (2), (4), and (5) of section 101(a); and

`(C) has been in existence for at least 2 years.

`(2) ADDITIONAL INSTITUTIONS- The term `postsecondary vocational institution' also includes an educational institution in any State that, in lieu of the requirement in paragraph (1) of section 101(a), admits as regular students persons who are beyond the age of compulsory school attendance in the State in which the institution is located.

`SEC. 103. ADDITIONAL DEFINITIONS.

`In this Act:

`(1) COMBINATION OF INSTITUTIONS OF HIGHER EDUCATION- The term `combination of institutions of higher education' means a group of institutions of higher education that have entered into a cooperative arrangement for the purpose of carrying out a common objective, or a public or private nonprofit agency, organization, or institution designated or created by a group of institutions of higher education for the purpose of carrying out a common objective on the group's behalf.

`(2) DEPARTMENT- The term `Department' means the Department of Education.

`(3) DISABILITY- The term `disability' has the same meaning given that term under section 3(2) of the Americans With Disabilities Act of 1990.

`(4) ELEMENTARY SCHOOL- The term `elementary school' has the same meaning given that term under section 14101 of the Elementary and Secondary Education Act of 1965.

`(5) GIFTED AND TALENTED- The term `gifted and talented' has the same meaning given that term under section 14101 of the Elementary and Secondary Education Act of 1965.

`(6) LOCAL EDUCATIONAL AGENCY- The term `local educational agency' has the same meaning given that term under section 14101 of the Elementary and Secondary Education Act of 1965.

`(7) NEW BORROWER- The term `new borrower' when used with respect to any date means an individual who on that date has no outstanding balance of principal or interest owing on any loan made, insured, or guaranteed under title IV.

`(8) NONPROFIT- The term `nonprofit' as applied to a school, agency, organization, or institution means a school, agency, organization, or institution owned and operated by one or more nonprofit corporations or associations, no part of the net earnings of which inures, or may lawfully inure, to the benefit of any private shareholder or individual.

`(9) SCHOOL OR DEPARTMENT OF DIVINITY- The term `school or department of divinity' means an institution, or a department or a branch of an institution, the program of instruction of which is designed for the education of students--

`(A) to prepare the students to become ministers of religion or to enter upon some other religious vocation (or to provide continuing training for any such vocation); or

`(B) to prepare the students to teach theological subjects.

`(10) SECONDARY SCHOOL- The term `secondary school' has the same meaning given that term under section 14101 of the Elementary and Secondary Education Act of 1965.

`(11) SECRETARY- The term `Secretary' means the Secretary of Education.

`(12) SERVICE-LEARNING- The term `service-learning' has the same meaning given that term under section 101(23) of the National and Community Service Act of 1990.

`(13) SPECIAL EDUCATION TEACHER- The term `special education teacher' means teachers who teach children with disabilities as defined in section 602 of the Individuals with Disabilities Education Act.

`(14) STATE EDUCATIONAL AGENCY- The term `State educational agency' has the same meaning given that term under section 14101 of the Elementary and Secondary Education Act of 1965.

`(15) STATE HIGHER EDUCATION AGENCY- The term `State higher education agency' means the officer or agency primarily responsible for the State supervision of higher education.

`(16) STATE; FREELY ASSOCIATED STATES-

`(A) STATE- The term `State' includes, in addition to the several States of the United States, the Commonwealth of Puerto Rico, the District of Columbia, Guam, American Samoa, the United States Virgin Islands, the Commonwealth of the Northern Mariana Islands, and the Freely Associated States.

`(B) FREELY ASSOCIATED STATES- The term `Freely Associated States' means the Republic of the Marshall Islands, the Federated States of Micronesia, and the Republic of Palau.

`PART B--ADDITIONAL GENERAL PROVISIONS

`SEC. 111. ANTIDISCRIMINATION.

`(a) IN GENERAL- Institutions of higher education receiving Federal financial assistance may not use such financial assistance, directly or indirectly, to undertake any study or project or fulfill the terms of any contract containing an express or implied provision that any person or persons of a particular race, religion, sex, or national origin be barred from performing such study, project, or contract, except that nothing in this subsection shall be construed to prohibit an institution from conducting objective studies or projects concerning the nature, effects, or prevention of discrimination, or to have the institution's curriculum restricted on the subject of discrimination.

`(b) LIMITATIONS ON STATUTORY CONSTRUCTION- Nothing in this Act shall be construed to limit the rights or responsibilities of any individual under the Americans With Disabilities Act of 1990, the Rehabilitation Act of 1973, or any other law.

`SEC. 112. PROTECTION OF STUDENT SPEECH AND ASSOCIATION RIGHTS.

`(a) PROTECTION OF RIGHTS- It is the sense of Congress that no student attending an institution of higher education on a full- or part-time basis should, on the basis of participation in protected speech or protected association, be excluded from participation in, be denied the benefits of, or be subjected to discrimination or official sanction under any education program, activity, or division of the institution directly or indirectly receiving financial assistance under this Act, whether or not such program, activity, or division is sponsored or officially sanctioned by the institution.

`(b) CONSTRUCTION- Nothing in this section shall be construed--

`(1) to discourage the imposition of an official sanction on a student that has willfully participated in the disruption or attempted disruption of a lecture, class, speech, presentation, or performance made or scheduled to be made under the auspices of the institution of higher education; or

`(2) to prevent an institution of higher education from taking appropriate and effective action to prevent violations of State liquor laws, to discourage binge drinking and other alcohol abuse, to protect students from sexual harassment including assault and date rape, to prevent hazing, or to regulate unsanitary or unsafe conditions in any student residence.

`(c) DEFINITIONS- For the purposes of this section:

`(1) OFFICIAL SANCTION- The term `official sanction'--

`(A) means expulsion, suspension, probation, censure, condemnation, reprimand, or any other disciplinary, coercive, or adverse action taken by an institution of higher education or administrative unit of the institution; and

`(B) includes an oral or written warning made by an official of an institution of higher education acting in the official capacity of the official.

`(2) PROTECTED ASSOCIATION- The term `protected association' means the joining, assembling, and residing with others that is protected under the first and 14th amendments to the Constitution, or would be protected if the institution of higher education involved were subject to those amendments.

`(3) PROTECTED SPEECH- The term `protected speech' means speech that is protected under the first and 14th amendments to the Constitution, or would be protected if the institution of higher education involved were subject to those amendments.

`SEC. 113. TREATMENT OF TERRITORIES AND TERRITORIAL STUDENT ASSISTANCE.

`(a) WAIVER AUTHORITY- The Secretary is required to waive the eligibility criteria of any postsecondary education program administered by the Department where such criteria do not take into account the unique circumstances in Guam, the United States Virgin Islands, American Samoa, the Commonwealth of the Northern Mariana Islands, and the Freely Associated States.

`(b) ELIGIBILITY- Notwithstanding any other provision of law, an institution of higher education that is located in any of the Freely Associated States, rather than in another State, shall be eligible, if otherwise qualified, for assistance under chapter 1 of subpart 2 of part A of title IV. This subsection shall cease to be effective on September 30, 2004.

`SEC. 114. NATIONAL ADVISORY COMMITTEE ON INSTITUTIONAL QUALITY AND INTEGRITY.

`(a) ESTABLISHMENT- There is established in the Department a National Advisory Committee on Institutional Quality and Integrity (hereafter in this section referred to as the `Committee'), which shall be composed of 15 members appointed by the Secretary from among individuals who are representatives of, or knowledgeable concerning, education and training beyond secondary education, including representatives of all sectors and types of institutions of higher education (as defined in section 102), to assess the process of eligibility and certification of such institutions under title IV and the provision of financial aid under title IV.

`(b) TERMS OF MEMBERS- Terms of office of each member of the Committee shall be 3 years, except that any member appointed to fill a vacancy occurring prior to the expiration of the term for which the member's predecessor was appointed shall be appointed for the remainder of such term.

`(c) PUBLIC NOTICE- The Secretary shall--

`(1) annually publish in the Federal Register a list containing the name of each member of the Committee and the date of the expiration of the term of office of the member; and

`(2) publicly solicit nominations for each vacant position or expiring term of office on the Committee.

`(d) FUNCTIONS- The Committee shall--

`(1) advise the Secretary with respect to establishment and enforcement of the standards of accrediting agencies or associations under subpart 2 of part H of title IV;

`(2) advise the Secretary with respect to the recognition of a specific accrediting agency or association;

`(3) advise the Secretary with respect to the preparation and publication of the list of nationally recognized accrediting agencies and associations;

`(4) develop and recommend to the Secretary standards and criteria for specific categories of vocational training institutions and institutions of higher education for which there are no recognized accrediting agencies, associations, or State agencies, in order to establish the eligibility of such institutions on an interim basis for participation in federally funded programs;

`(5) advise the Secretary with respect to the eligibility and certification process for institutions of higher education under title IV, together with recommendations for improvements in such process;

`(6) advise the Secretary with respect to the relationship between--

`(A) accreditation of institutions of higher education and the certification and eligibility of such institutions; and

`(B) State licensing responsibilities with respect to such institutions; and

`(7) carry out such other advisory functions relating to accreditation and institutional eligibility as the Secretary may prescribe.

`(e) MEETING PROCEDURES- The Committee shall meet not less than twice each year at the call of the Chairperson. The date of, and agenda for, each meeting of the Committee shall be submitted in advance to the Secretary for approval. A representative of the Secretary shall be present at all meetings of the Committee.

`(f) REPORT- Not later than November 30 of each year, the Committee shall make an annual report through the Secretary to Congress. The annual report shall contain--

`(1) a list of the members of the Committee and their addresses;

`(2) a list of the functions of the Committee;

`(3) a list of dates and places of each meeting during the preceding fiscal year; and

`(4) a summary of the activities, findings and recommendations made by the Committee during the preceding fiscal year.

`(g) TERMINATION- The Committee shall cease to exist on September 30, 2004.

`SEC. 115. STUDENT REPRESENTATION.

`The Secretary shall, in appointing individuals to any commission, committee, board, panel, or other body in connection with the administration of this Act, include individuals who are, at the time of appointment, attending an institution of higher education.

`SEC. 116. FINANCIAL RESPONSIBILITY OF FOREIGN STUDENTS.

`Nothing in this Act or any other Federal law shall be construed to prohibit any institution of higher education from requiring a student who is a foreign national (and not admitted to permanent residence in the United States) to guarantee the future payment of tuition and fees to such institution by--

`(1) making advance payment of such tuition and fees;

`(2) making deposits in an escrow account administered by such institution for such payments; or

`(3) obtaining a bond or other insurance that such payments will be made.

`SEC. 117. DISCLOSURES OF FOREIGN GIFTS.

`(a) DISCLOSURE REPORT- Whenever any institution is owned or controlled by a foreign source or receives a gift from or enters into a contract with a foreign source, the value of which is $250,000 or more, considered alone or in combination with all other gifts from or contracts with that foreign source within a calendar year, the institution shall file a disclosure report with the Secretary on January 31 or July 31, whichever is sooner.

`(b) CONTENTS OF REPORT- Each report to the Secretary required by this section shall contain the following:

`(1) For gifts received from or contracts entered into with a foreign source other than a foreign government, the aggregate dollar amount of such gifts and contracts attributable to a particular country. The country to which a gift is attributable is the country of citizenship, or if unknown, the principal residence for a foreign source who is a natural person, and the country of incorporation, or if unknown, the principal place of business, for a foreign source which is a legal entity.

`(2) For gifts received from or contracts entered into with a foreign government, the aggregate amount of such gifts and contracts received from each foreign government.

`(3) In the case of an institution which is owned or controlled by a foreign source, the identity of the foreign source, the date on which the foreign source assumed ownership or control, and any changes in program or structure resulting from the change in ownership or control.

`(c) ADDITIONAL DISCLOSURES FOR RESTRICTED AND CONDITIONAL GIFTS- Notwithstanding the provisions of subsection (b), whenever any institution receives a restricted or conditional gift or contract from a foreign source, the institution shall disclose the following:

`(1) For such gifts received from or contracts entered into with a foreign source other than a foreign government, the amount, the date, and a description of such conditions or restrictions. The report shall also disclose the country of citizenship, or if unknown, the principal residence for a foreign source which is a natural person, and the country of incorporation, or if unknown, the principal place of business for a foreign source which is a legal entity.

`(2) For gifts received from or contracts entered into with a foreign government, the amount, the date, a description of such conditions or restrictions, and the name of the foreign government.

`(d) RELATION TO OTHER REPORTING REQUIREMENTS-

`(1) STATE REQUIREMENTS- If an institution described under subsection (a) is within a State which has enacted requirements for public disclosure of gifts from or contracts with a foreign source that are substantially similar to the requirements of this section, a copy of the disclosure report filed with the State may be filed with the Secretary in lieu of a report required under subsection (a). The State in which the institution is located shall provide to the Secretary such assurances as the Secretary may require to establish that the institution has met the requirements for public disclosure under State law if the State report is filed.

`(2) USE OF OTHER FEDERAL REPORTS- If an institution receives a gift from, or enters into a contract with, a foreign source, where any other department, agency, or bureau of the executive branch requires a report containing requirements substantially similar to those required under this section, a copy of the report may be filed with the Secretary in lieu of a report required under subsection (a).

`(e) PUBLIC INSPECTION- All disclosure reports required by this section shall be public records open to inspection and copying during business hours.

`(f) ENFORCEMENT-

`(1) COURT ORDERS- Whenever it appears that an institution has failed to comply with the requirements of this section, including any rule or regulation promulgated under this section, a civil action may be brought by the Attorney General, at the request of the Secretary, in an appropriate district court of the United States, or the appropriate United States court of any territory or other place subject to the jurisdiction of the United States, to request such court to compel compliance with the requirements of this section.

`(2) COSTS- For knowing or willful failure to comply with the requirements of this section, including any rule or regulation promulgated thereunder, an institution shall pay to the Treasury of the United States the full costs to the United States of obtaining compliance, including all associated costs of investigation and enforcement.

`(g) REGULATIONS- The Secretary may promulgate regulations to carry out this section.

`(h) DEFINITIONS- For the purpose of this section--

`(1) the term `contract' means any agreement for the acquisition by purchase, lease, or barter of property or services by the foreign source, for the direct benefit or use of either of the parties;

`(2) the term `foreign source' means--

`(A) a foreign government, including an agency of a foreign government;

`(B) a legal entity, governmental or otherwise, created solely under the laws of a foreign state or states;

`(C) an individual who is not a citizen or a national of the United States or a trust territory or protectorate thereof; and

`(D) an agent, including a subsidiary or affiliate of a foreign legal entity, acting on behalf of a foreign source;

`(3) the term `gift' means any gift of money or property;

`(4) the term `institution' means any institution, public or private, or, if a multicampus institution, any single campus of such institution, in any State, that--

`(A) is legally authorized within such State to provide a program of education beyond secondary school;

`(B) provides a program for which the institution awards a bachelor's degree (or provides not less than a 2-year program which is acceptable for full credit toward such a degree) or more advanced degrees; and

`(C) is accredited by a nationally recognized accrediting agency or association and to which institution Federal financial assistance is extended (directly or indirectly through another entity or person), or which institution receives support from the extension of Federal financial assistance to any of the institution's subunits; and

`(5) the term `restricted or conditional gift or contract' means any endowment, gift, grant, contract, award, present, or property of any kind which includes provisions regarding--

`(A) the employment, assignment, or termination of faculty;

`(B) the establishment of departments, centers, research or lecture programs, or new faculty positions;

`(C) the selection or admission of students; or

`(D) the award of grants, loans, scholarships, fellowships, or other forms of financial aid restricted to students of a specified country, religion, sex, ethnic origin, or political opinion.

`SEC. 118. APPLICATION OF PEER REVIEW PROCESS.

`All applications submitted under the provisions of this Act which require peer review shall be read by a panel of readers composed of individuals selected by the Secretary, which shall include outside readers who are not employees of the Federal Government. The Secretary shall ensure that no individual assigned under this section to review any application has any conflict of interest with regard to that application which might impair the impartiality with which that individual conducts the review under this section.

`SEC. 119. BINGE DRINKING ON COLLEGE CAMPUSES.

`(a) SHORT TITLE- This section may be cited as the `Collegiate Initiative To Reduce Binge Drinking and Illegal Alcohol Consumption'.

`(b) SENSE OF CONGRESS- It is the sense of Congress that, in an effort to change the culture of alcohol consumption on college campuses, all institutions of higher education should carry out the following:

`(1) The president of the institution should appoint a task force consisting of school administrators, faculty, students, Greek system representatives, and others to conduct a full examination of student and academic life at the institution. The task force should make recommendations for a broad range of policy and program changes that would serve to reduce alcohol and other drug-related problems. The institution should provide resources to assist the task force in promoting the campus policies and proposed environmental changes that have been identified.

`(2) The institution should provide maximum opportunities for students to live in an alcohol-free environment and to engage in stimulating, alcohol-free recreational and leisure activities.

`(3) The institution should enforce a `zero tolerance' policy on the illegal consumption of alcohol by students at the institution.

`(4) The institution should vigorously enforce the institution's code of disciplinary sanctions for those who violate campus alcohol policies. Students with alcohol or other drug-related problems should be referred for assistance, including on-campus counseling programs if appropriate.

`(5) The institution should adopt a policy to discourage alcoholic beverage-related sponsorship of on-campus activities. It should adopt policies limiting the advertisement and promotion of alcoholic beverages on campus.

`(6) The institution should work with the local community, including local businesses, in a `Town/Gown' alliance to encourage responsible policies toward alcohol consumption and to address illegal alcohol use by students.

`SEC. 120. DRUG AND ALCOHOL ABUSE PREVENTION.

`(a) RESTRICTION ON ELIGIBILITY- Notwithstanding any other provision of law, no institution of higher education shall be eligible to receive funds or any other form of financial assistance under any Federal program, including participation in any federally funded or guaranteed student loan program, unless the institution certifies to the Secretary that the institution has adopted and has implemented a program to prevent the use of illicit drugs and the abuse of alcohol by students and employees that, at a minimum, includes--

`(1) the annual distribution to each student and employee of--

`(A) standards of conduct that clearly prohibit, at a minimum, the unlawful possession, use, or distribution of illicit drugs and alcohol by students and employees on the institution's property or as part of any of the institution's activities;

`(B) a description of the applicable legal sanctions under local, State, or Federal law for the unlawful possession or distribution of illicit drugs and alcohol;

`(C) a description of the health-risks associated with the use of illicit drugs and the abuse of alcohol;

`(D) a description of any drug or alcohol counseling, treatment, or rehabilitation or re-entry programs that are available to employees or students; and

`(E) a clear statement that the institution will impose sanctions on students and employees (consistent with local, State, and Federal law), and a description of those sanctions, up to and including expulsion or termination of employment and referral for prosecution, for violations of the standards of conduct required by subparagraph (A); and

`(2) a biennial review by the institution of the institution's program to--

`(A) determine the program's effectiveness and implement changes to the program if the changes are needed; and

`(B) ensure that the sanctions required by paragraph (1)(E) are consistently enforced.

`(b) INFORMATION AVAILABILITY- Each institution of higher education that provides the certification required by subsection (a) shall, upon request, make available to the Secretary and to the public a copy of each item required by subsection (a)(1) as well as the results of the biennial review required by subsection (a)(2).

`(c) REGULATIONS-

`(1) IN GENERAL- The Secretary shall publish regulations to implement and enforce the provisions of this section, including regulations that provide for--

`(A) the periodic review of a representative sample of programs required by subsection (a); and

`(B) a range of responses and sanctions for institutions of higher education that fail to implement their programs or to consistently enforce their sanctions, including information and technical assistance, the development of a compliance agreement, and the termination of any form of Federal financial assistance.

`(2) REHABILITATION PROGRAM- The sanctions required by subsection (a)(1)(E) may include the completion of an appropriate rehabilitation program.

`(d) APPEALS- Upon determination by the Secretary to terminate financial assistance to any institution of higher education under this section, the institution may file an appeal with an administrative law judge before the expiration of the 30-day period beginning on the date such institution is notified of the decision to terminate financial assistance under this section. Such judge shall hold a hearing with respect to such termination of assistance before the expiration of the 45-day period beginning on the date that such appeal is filed. Such judge may extend such 45-day period upon a motion by the institution concerned. The decision of the judge with respect to such termination shall be considered to be a final agency action.

`(e) ALCOHOL AND DRUG ABUSE PREVENTION GRANTS-

`(1) PROGRAM AUTHORITY- The Secretary may make grants to institutions of higher education or consortia of such institutions, and enter into contracts with such institutions, consortia, and other organizations, to develop, implement, operate, improve, and disseminate programs of prevention, and education (including treatment-referral) to reduce and eliminate the illegal use of drugs and alcohol and the violence associated with such use. Such grants or contracts may also be used for the support of a higher education center for alcohol and drug abuse prevention that will provide training, technical assistance, evaluation, dissemination, and associated services and assistance to the higher education community as determined by the Secretary and institutions of higher education.

`(2) AWARDS- Grants and contracts shall be awarded under paragraph (1) on a competitive basis.

`(3) APPLICATIONS- An institution of higher education, a consortium of such institutions, or another organization that desires to receive a grant or contract under paragraph (1) shall submit an application to the Secretary at such time, in such manner, and containing or accompanied by such information as the Secretary may reasonably require by regulation.

`(4) ADDITIONAL REQUIREMENTS-

`(A) PARTICIPATION- In awarding grants and contracts under this subsection the Secretary shall make every effort to ensure--

`(i) the equitable participation of private and public institutions of higher education (including community and junior colleges); and

`(ii) the equitable geographic participation of such institutions.

`(B) CONSIDERATION- In awarding grants and contracts under this subsection the Secretary shall give appropriate consideration to institutions of higher education with limited enrollment.

`(5) AUTHORIZATION OF APPROPRIATIONS- There are authorized to be appropriated to carry out this subsection $5,000,000 for fiscal year 1999 and such sums as may be necessary for each of the 4 succeeding fiscal years.

`(f) NATIONAL RECOGNITION AWARDS-

`(1) PURPOSE- It is the purpose of this subsection to provide models of innovative and effective alcohol and drug abuse prevention programs in higher education and to focus national attention on exemplary alcohol and drug abuse prevention efforts.

`(2) AWARDS-

`(A) IN GENERAL- The Secretary shall make 5 National Recognition Awards for outstanding alcohol prevention programs and 5 National Recognition Awards for outstanding drug abuse prevention programs, on an annual basis, to institutions of higher education that--

`(i) have developed and implemented innovative and effective alcohol prevention programs or drug abuse prevention programs; and

`(ii) with respect to an application for an alcohol prevention program award, demonstrate in the application submitted under paragraph (3) that the institution has undertaken efforts designed to change the culture of college drinking consistent with the review criteria described in paragraph (3)(C)(iii).

`(B) CEREMONY- The awards shall be made at a ceremony in Washington, D.C.

`(C) DOCUMENT- The Secretary shall publish a document describing the alcohol and drug abuse prevention programs of institutions of higher education that receive the awards under this subsection and disseminate the document nationally to all public and private secondary school guidance counselors for use by secondary school juniors and seniors preparing to enter an institution of higher education. The document shall be disseminated not later than January 1 of each academic year.

`(D) AMOUNT AND USE- Each institution of higher education selected to receive an award under this subsection shall receive an award in the amount of $50,000. Such award shall be used for the maintenance and improvement of the institution's outstanding prevention program for the academic year following the academic year for which the award is made.

`(3) APPLICATION-

`(A) IN GENERAL- Each institution of higher education desiring an award under this subsection shall submit an application to the Secretary at such time, in such manner, and accompanied by such information as the Secretary may require. Each such application shall contain--

`(i) a clear description of the goals and objectives of the prevention program of the institution;

`(ii) a description of program activities that focus on alcohol or drug policy issues, policy development, modification, or refinement, policy dissemination and implementation, and policy enforcement;

`(iii) a description of activities that encourage student and employee participation and involvement in activity development and implementation;

`(iv) the objective criteria used to determine the effectiveness of the methods used in such programs and the means used to evaluate and improve the programs' efforts;

`(v) a description of special initiatives used to reduce high-risk behavior or increase low-risk behavior; and

`(vi) a description of coordination and networking efforts that exist in the community in which the institution is located for purposes of such programs.

`(B) APPLICATION REVIEW- The Secretary shall appoint a committee to review applications submitted under this paragraph. The committee may include representatives of Federal departments or agencies the programs of which include alcohol abuse prevention and education efforts and drug abuse prevention and education efforts, directors or heads (or their representatives) of professional associations that focus on alcohol and drug abuse prevention efforts, and non-Federal scientists who have backgrounds in social science evaluation and research methodology and in education. Decisions of the committee shall be made directly to the Secretary without review by any other entity in the Department.

`(C) REVIEW CRITERIA- The committee described in subparagraph (B) shall develop specific review criteria for reviewing and evaluating applications submitted under this paragraph. The review criteria shall include--

`(i) measures of the effectiveness of the program of the institution, that includes changes in the campus alcohol or other drug environment or the climate and changes in alcohol or other drug use before and after the initiation of the program;

`(ii) measures of program institutionalization, including--

`(I) an assessment of needs of the institution;

`(II) the institution's alcohol and drug policies, staff and faculty development activities, drug prevention criteria, student, faculty, and campus community involvement; and

`(III) whether the program will be continued after the cessation of Federal funding; and

`(iii) with respect to an application for an alcohol prevention program award, criteria for determining whether the institution has policies in effect that--

`(I) prohibit alcoholic beverage sponsorship of athletic events, and prohibit alcoholic beverage advertising inside athletic facilities;

`(II) prohibit alcoholic beverage marketing on campus, which may include efforts to ban alcohol advertising in institutional publications or efforts to prohibit alcohol-related advertisements at campus events;

`(III) establish or expand upon alcohol-free living arrangements for all college students;

`(IV) establish partnerships with community members and organizations to further alcohol prevention efforts on campus and the areas surrounding campus; and

`(V) establish innovative communications programs involving students and faculty in an effort to educate students about alcohol-related risks.

`(4) ELIGIBILITY- In order to be eligible to receive a National Recognition Award an institution of higher education shall--

`(A) offer an associate or baccalaureate degree;

`(B) have established an alcohol abuse prevention and education program or a drug abuse prevention and education program;

`(C) nominate itself or be nominated by others, such as professional associations or student organizations, to receive the award; and

`(D) not have received an award under this subsection during the 5 academic years preceding the academic year for which the determination is made.

`(5) AUTHORIZATION OF APPROPRIATIONS-

`(A) IN GENERAL- There is authorized to be appropriated to carry out this subsection $750,000 for fiscal year 1999.

`(B) AVAILABILITY- Funds appropriated under subparagraph (A) shall remain available until expended.

`SEC. 121. PRIOR RIGHTS AND OBLIGATIONS.

`(a) AUTHORIZATION OF APPROPRIATIONS-

`(1) PRE-1987 PARTS C AND D OF TITLE VII- There are authorized to be appropriated such sums as may be necessary for fiscal year 1999 and for each of the 4 succeeding fiscal years to pay obligations incurred prior to 1987 under parts C and D of title VII, as such parts were in effect before the effective date of the Higher Education Amendments of 1992.

`(2) POST-1992 AND PRE-1998 PART C OF TITLE VII- There are authorized to be appropriated such sums as may be necessary for fiscal year 1999 and for each of the 4 succeeding fiscal years to pay obligations incurred prior to the date of enactment of the Higher Education Amendments of 1998 under part C of title VII, as such part was in effect during the period--

`(A) after the effective date of the Higher Education Amendments of 1992; and

`(B) prior to the date of enactment of the Higher Education Amendments of 1998.

`(b) LEGAL RESPONSIBILITIES-

`(1) PRE-1987 TITLE VII- All entities with continuing obligations incurred under parts A, B, C, and D of title VII, as such parts were in effect before the effective date of the Higher Education Amendments of 1992, shall be subject to the requirements of such part as in effect before the effective date of the Higher Education Amendments of 1992.

`(2) POST-1992 AND PRE-1998 PART C OF TITLE VII- All entities with continuing obligations incurred under part C of title VII, as such part was in effect during the period--

`(A) after the effective date of the Higher Education Amendments of 1992; and

`(B) prior to the date of enactment of the Higher Education Amendments of 1998,

shall be subject to the requirements of such part as such part was in effect during such period.

`SEC. 122. RECOVERY OF PAYMENTS.

`(a) PUBLIC BENEFIT- Congress declares that, if a facility constructed with the aid of a grant under part A of title VII as such part A was in effect prior to the date of enactment of the Higher Education Amendments of 1998, or part B of such title as part B was in effect prior to the date of enactment of the Higher Education Amendments of 1992, is used as an academic facility for 20 years following completion of such construction, the public benefit accruing to the United States will equal in value the amount of the grant. The period of 20 years after completion of such construction shall therefore be deemed to be the period of Federal interest in such facility for the purposes of such title as so in effect.

`(b) RECOVERY UPON CESSATION OF PUBLIC BENEFIT- If, within 20 years after completion of construction of an academic facility which has been constructed, in part with a grant under part A of title VII as such part A was in effect prior to the date of enactment of the Higher Education Amendments of 1998, or part B of title VII as such part B was in effect prior to the date of enactment of the Higher Education Amendments of 1992--

`(1) the applicant under such parts as so in effect (or the applicant's successor in title or possession) ceases or fails to be a public or nonprofit institution; or

`(2) the facility ceases to be used as an academic facility, or the facility is used as a facility excluded from the term `academic facility' (as such term was defined under title VII, as so in effect), unless the Secretary determines that there is good cause for releasing the institution from its obligation,

the United States shall be entitled to recover from such applicant (or successor) an amount which bears to the value of the facility at that time (or so much thereof as constituted an approved project or projects) the same ratio as the amount of Federal grant bore to the cost of the facility financed with the aid of such grant. The value shall be determined by agreement of the parties or by action brought in the United States district court for the district in which such facility is situated.

`(c) PROHIBITION ON USE FOR RELIGION- Notwithstanding the provisions of subsections (a) and (b), no project assisted with funds under title VII (as in effect prior to the date of enactment of the Higher Education Amendments of 1998) shall ever be used for religious worship or a sectarian activity or for a school or department of divinity.

`PART C--COST OF HIGHER EDUCATION

`SEC. 131. IMPROVEMENTS IN MARKET INFORMATION AND PUBLIC ACCOUNTABILITY IN HIGHER EDUCATION.

`(a) IMPROVED DATA COLLECTION-

`(1) DEVELOPMENT OF UNIFORM METHODOLOGY- The Secretary shall direct the Commissioner of Education Statistics to convene a series of forums to develop nationally consistent methodologies for reporting costs incurred by postsecondary institutions in providing postsecondary education.

`(2) REDESIGN OF DATA SYSTEMS- On the basis of the methodologies developed pursuant to paragraph (1), the Secretary shall redesign relevant parts of the postsecondary education data systems to improve the usefulness and timeliness of the data collected by such systems.

`(3) INFORMATION TO INSTITUTIONS- The Commissioner of Education Statistics shall--

`(A) develop a standard definition for the following data elements:

`(i) tuition and fees for a full-time undergraduate student;

`(ii) cost of attendance for a full-time undergraduate student, consistent with the provisions of section 472;

`(iii) average amount of financial assistance received by an undergraduate student who attends an institution of higher education, including--

`(I) each type of assistance or benefit described in section 428(a)(2)(C)(i);

`(II) fellowships; and

`(III) institutional and other assistance; and

`(iv) number of students receiving financial assistance described in each of subclauses (I), (II), and (III) of clause (iii);

`(B) not later than 90 days after the date of enactment of the Higher Education Amendments of 1998, report the definitions to each institution of higher education and within a reasonable period of time thereafter inform the Committee on Labor and Human Resources of the Senate and the Committee on Education and the Workforce of the House of Representatives of those definitions; and

`(C) collect information regarding the data elements described in subparagraph (A) with respect to at least all institutions of higher education participating in programs under title IV, beginning with the information from academic year 2000-2001 and annually thereafter.

`(b) DATA DISSEMINATION- The Secretary shall make available the data collected pursuant to subsection (a). Such data shall be available in a form that permits the review and comparison of the data submissions of individual institutions of higher education. Such data shall be presented in a form that is easily understandable and allows parents and students to make informed decisions based on the costs for typical full-time undergraduate students.

`(c) STUDY-

`(1) IN GENERAL- The Commissioner of Education Statistics shall conduct a national study of expenditures at institutions of higher education. Such study shall include information with respect to--

`(A) the change in tuition and fees compared with the consumer price index and other appropriate measures of inflation;

`(B) faculty salaries and benefits;

`(C) administrative salaries, benefits and expenses;

`(D) academic support services;

`(E) research;

`(F) operations and maintenance; and

`(G) institutional expenditures for construction and technology and the potential cost of replacing instructional buildings and equipment.

`(2) EVALUATION- The study shall include an evaluation of--

`(A) changes over time in the expenditures identified in paragraph (1);

`(B) the relationship of the expenditures identified in paragraph (1) to college costs; and

`(C) the extent to which increases in institutional financial aid and tuition discounting practices affect tuition increases, including the demographics of students receiving such discounts, the extent to which financial aid is provided to students with limited need in order to attract a student to a particular institution, and the extent to which Federal financial aid, including loan aid, has been used to offset the costs of such practices.

`(3) FINAL REPORT- The Commissioner of Education Statistics shall submit a report regarding the findings of the study required by paragraph (1) to the appropriate committees of Congress not later than September 30, 2002.

`(4) HIGHER EDUCATION MARKET BASKET- The Bureau of Labor Statistics, in consultation with the Commissioner of Education Statistics, shall develop a higher education market basket that identifies the items that comprise the costs of higher education. The Bureau of Labor Statistics shall provide a report on the market basket to the Committee on Labor and Human Resources of the Senate and the Committee on Education and the Workforce of the House of Representatives not later than September 30, 2002.

`(5) FINES- In addition to actions authorized in section 487(c), the Secretary may impose a fine in an amount not to exceed $25,000 on an institution of higher education for failing to provide the information described in paragraph (1) in a timely and accurate manner, or for failing to otherwise cooperate with the National Center for Education Statistics regarding efforts to obtain data on the cost of higher education under this section and pursuant to the program participation agreement entered into under section 487.

`(d) STUDENT AID RECIPIENT SURVEY- (1) The Secretary shall survey student aid recipients on a regular cycle, but not less than once every 3 years--

`(A) to identify the population of students receiving Federal student aid;

`(B) to determine the income distribution and other socioeconomic characteristics of federally aided students;

`(C) to describe the combinations of aid from State, Federal, and private sources received by students from all income groups;

`(D) to describe the debt burden of loan recipients and their capacity to repay their education debts; and

`(E) to disseminate such information in both published and machine readable form.

`(2) The survey shall be representative of full-time and part-time, undergraduate, graduate, and professional and current and former students in all types of institutions, and should be designed and administered in consultation with the Congress and the postsecondary education community.

`PART D--ADMINISTRATIVE PROVISIONS FOR DELIVERY OF STUDENT FINANCIAL ASSISTANCE

`SEC. 141. PERFORMANCE-BASED ORGANIZATION FOR THE DELIVERY OF FEDERAL STUDENT FINANCIAL ASSISTANCE.

`(a) ESTABLISHMENT AND PURPOSE-

`(1) ESTABLISHMENT- There is established in the Department a Performance-Based Organization (hereafter referred to as the `PBO') which shall be a discrete management unit responsible for managing the operational functions supporting the programs authorized under title IV of this Act, as specified in subsection (b).

`(2) PURPOSES- The purposes of the PBO are--

`(A) to improve service to students and other participants in the student financial assistance programs authorized under title IV, including making those programs more understandable to students and their parents;

`(B) to reduce the costs of administering those programs;

`(C) to increase the accountability of the officials responsible for administering the operational aspects of these programs;

`(D) to provide greater flexibility in the management of the operational functions of the Federal student financial assistance programs;

`(E) to integrate the information systems supporting the Federal student financial assistance programs;

`(F) to implement an open, common, integrated system for the delivery of student financial assistance under title IV; and

`(G) to develop and maintain a student financial assistance system that contains complete, accurate, and timely data to ensure program integrity.

`(b) GENERAL AUTHORITY-

`(1) AUTHORITY OF SECRETARY- Notwithstanding any other provision of this part, the Secretary shall maintain responsibility for the development and promulgation of policy and regulations relating to the programs of student financial assistance under title IV. In the exercise of its functions, the PBO shall be subject to the direction of the Secretary. The Secretary shall--

`(A) request the advice of, and work in cooperation with, the Chief Operating Officer in developing regulations, policies, administrative guidance, or procedures affecting the information systems administered by the PBO, and other functions performed by the PBO;

`(B) request cost estimates from the Chief Operating Officer for system changes required by specific policies proposed by the Secretary; and

`(C) assist the Chief Operating Officer in identifying goals for the administration and modernization of the delivery system for student financial assistance under title IV.

`(2) PBO FUNCTIONS- Subject to paragraph (1), the PBO shall be responsible for administration of the information and financial systems that support student financial assistance programs authorized under this title, excluding the development of policy relating to such programs but including the following:

`(A) The administrative, accounting, and financial management functions of the delivery system for Federal student assistance, including--

`(i) the collection, processing and transmission of applicant data to students, institutions and authorized third parties, as provided for in section 483;

`(ii) design and technical specifications for software development and systems supporting the delivery of student financial assistance under title IV;

`(iii) all software and hardware acquisitions and all information technology contracts related to the delivery and management of student financial assistance under title IV;

`(iv) all aspects of contracting for the information and financial systems supporting student financial assistance programs under this title; and

`(v) providing all customer service, training, and user support related to systems that support those programs.

`(B) Annual development of a budget for the operations and services of the PBO, in consultation with the Secretary, and for consideration and inclusion in the Department's annual budget submission.

`(3) ADDITIONAL FUNCTIONS- The Secretary may allocate to the PBO such additional functions as the Secretary and the Chief Operating Officer determine are necessary or appropriate to achieve the purposes of the PBO.

`(4) INDEPENDENCE- Subject to paragraph (1), in carrying out its functions, the PBO shall exercise independent control of its budget allocations and expenditures, personnel decisions and processes, procurements, and other administrative and management functions.

`(5) AUDITS AND REVIEW- The PBO shall be subject to the usual and customary Federal audit procedures and to review by the Inspector General of the Department.

`(6) CHANGES-

`(A) IN GENERAL- The Secretary and the Chief Operating Officer shall consult concerning the effects of policy, market, or other changes on the ability of the PBO to achieve the goals and objectives established in the performance plan described in subsection (c).

`(B) REVISIONS TO AGREEMENT- The Secretary and the Chief Operating Officer may revise the annual performance agreement described in subsection (d)(4) in light of policy, market, or other changes that occur after the Secretary and the Chief Operating Officer enter into the agreement.

`(c) PERFORMANCE PLAN AND REPORT-

`(1) PERFORMANCE PLAN-

`(A) IN GENERAL- Each year, the Secretary and Chief Operating Officer shall agree on, and make available to the public, a performance plan for the PBO for the succeeding 5 years that establishes measurable goals and objectives for the organization.

`(B) CONSULTATION- In developing the 5-year performance plan and any revision to the plan, the Secretary and the Chief Operating Officer shall consult with students, institutions of higher education, Congress, lenders, the Advisory Committee on Student Financial Assistance, and other interested parties not less than 30 days prior to the implementation of the performance plan or revision.

`(C) AREAS- The plan shall include a concise statement of the goals for a modernized system for the delivery of student financial assistance under title IV and identify action steps necessary to achieve such goals. The plan shall address the PBO's responsibilities in the following areas:

`(i) IMPROVING SERVICE- Improving service to students and other participants in student financial aid programs authorized under this title, including making those programs more understandable to students and their parents.

`(ii) REDUCING COSTS- Reducing the costs of administering those programs.

`(iii) IMPROVEMENT AND INTEGRATION OF SUPPORT SYSTEMS- Improving and integrating the information and delivery systems that support those programs.

`(iv) DELIVERY AND INFORMATION SYSTEM- Developing an open, common, and integrated delivery and information system for programs authorized under this title.

`(v) OTHER AREAS- Any other areas identified by the Secretary.

`(2) ANNUAL REPORT- Each year, the Chief Operating Officer shall prepare and submit to Congress, through the Secretary, an annual report on the performance of the PBO, including an evaluation of the extent to which the PBO met the goals and objectives contained in the 5-year performance plan described in paragraph (1) for the preceding year. The annual report shall include the following:

`(A) An independent financial audit of the expenditures of both the PBO and programs administered by the PBO.

`(B) Financial and performance requirements applicable to the PBO under the Chief Financial Officer Act of 1990 and the Government Performance and Results Act of 1993.

`(C) The results achieved by the PBO during the year relative to the goals established in the organization's performance plan.

`(D) The evaluation rating of the performance of the Chief Operating Officer and senior managers under subsections (d)(4) and (e)(2), including the amounts of bonus compensation awarded to these individuals.

`(E) Recommendations for legislative and regulatory changes to improve service to students and their families, and to improve program efficiency and integrity.

`(F) Other such information as the Director of the Office of Management and Budget shall prescribe for performance based organizations.

`(3) CONSULTATION WITH STAKEHOLDERS- The Chief Operating Officer, in preparing the report described in paragraph (2), shall establish appropriate means to consult with borrowers, institutions, lenders, guaranty agencies, secondary markets, and others involved in the delivery system of student aid under this title--

`(A) regarding the degree of satisfaction with the delivery system; and

`(B) to seek suggestions on means to improve the delivery system.

`(d) CHIEF OPERATING OFFICER-

`(1) APPOINTMENT- The management of the PBO shall be vested in a Chief Operating Officer who shall be appointed by the Secretary to a term of not less than 3 and not more than 5 years, and compensated without regard to chapters 33, 51, and 53 of title 5, United States Code. The Secretary shall appoint the Chief Operating Officer within 6 months after the date of enactment of the Higher Education Amendments of 1998. The appointment shall be made on the basis of demonstrated management ability and expertise in information technology, including experience with financial systems, and without regard to political affiliation or activity.

`(2) REAPPOINTMENT- The Secretary may reappoint the Chief Operating Officer to subsequent terms of not less than 3 and not more than 5 years, so long as the performance of the Chief Operating Officer, as set forth in the performance agreement described in paragraph (4), is satisfactory.

`(3) REMOVAL- The Chief Operating Officer may be removed by--

`(A) the President; or

`(B) the Secretary, for misconduct or failure to meet performance goals set forth in the performance agreement in paragraph (4).

The President or Secretary shall communicate the reasons for any such removal to the appropriate committees of Congress.

`(4) PERFORMANCE AGREEMENT-

`(A) IN GENERAL- Each year, the Secretary and the Chief Operating Officer shall enter into an annual performance agreement, that shall set forth measurable organization and individual goals for the Chief Operating Officer.

`(B) TRANSMITTAL- The final agreement, and any revision to the final agreement, shall be transmitted to the Committee on Education and the Workforce of the House of Representatives and the Committee on Labor and Human Resources of the Senate, and made publicly available.

`(5) COMPENSATION-

`(A) IN GENERAL- The Chief Operating Officer is authorized to be paid at an annual rate of basic pay not to exceed the maximum rate of basic pay for the Senior Executive Service under section 5382 of title 5, United States Code, including any applicable locality-based comparability payment that may be authorized under section 5304(h)(2)(B) of such title. The compensation of the Chief Operating Officer shall be considered for purposes of section 207(c)(2)(A) of title 18, United States Code, to be the equivalent of that described under clause (ii) of section 207(c)(2)(A) of such title.

`(B) BONUS- In addition, the Chief Operating Officer may receive a bonus in an amount that does not exceed 50 percent of such annual rate of basic pay, based upon the Secretary's evaluation of the Chief Operating Officer's performance in relation to the goals set forth in the performance agreement described in paragraph (2).

`(C) PAYMENT- Payment of a bonus under this subparagraph (B) may be made to the Chief Operating Officer only to the extent that such payment does not cause the Chief Operating Officer's total aggregate compensation in a calendar year to equal or exceed the amount of the President's salary under section 102 of title 3, United States Code.

`(e) SENIOR MANAGEMENT-

`(1) APPOINTMENT-

`(A) IN GENERAL- The Chief Operating Officer may appoint such senior managers as that officer determines necessary without regard to the provisions of title 5, United States Code, governing appointments in the competitive service.

`(B) COMPENSATION- The senior managers described in subparagraph (A) 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.

`(2) PERFORMANCE AGREEMENT- Each year, the Chief Operating Officer and each senior manager appointed under this subsection shall enter into an annual performance agreement that sets forth measurable organization and individual goals. The agreement shall be subject to review and renegotiation at the end of each term.

`(3) COMPENSATION-

`(A) IN GENERAL- A senior manager appointed under this subsection may be paid at an annual rate of basic pay of not more than the maximum rate of basic pay for the Senior Executive Service under section 5382 of title 5, United States Code, including any applicable locality-based comparability payment that may be authorized under section 5304(h)(2)(C) of such title. The compensation of a senior manager shall be considered for purposes of section 207(c)(2)(A) of title 18, United States Code, to be the equivalent of that described under clause (ii) of section 207(c)(2)(A) of such title.

`(B) BONUS- In addition, a senior manager may receive a bonus in 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 described in paragraph (2).

`(4) REMOVAL- A senior manager shall be removable by the Chief Operating Officer, or by the Secretary if the position of Chief Operating Officer is vacant.

`(f) STUDENT LOAN OMBUDSMAN-

`(1) APPOINTMENT- The Chief Operating Officer, in consultation with the Secretary, shall appoint a Student Loan Ombudsman to provide timely assistance to borrowers of loans made, insured, or guaranteed under title IV by performing the functions described in paragraph (3).

`(2) PUBLIC INFORMATION- The Chief Operating Officer shall disseminate information about the availability and functions of the Ombudsman to borrowers and potential borrowers, as well as institutions of higher education, lenders, guaranty agencies, loan servicers, and other participants in those student loan programs.

`(3) FUNCTIONS OF OMBUDSMAN- The Ombudsman shall--

`(A) in accordance with regulations of the Secretary, receive, review, and attempt to resolve informally complaints from borrowers of loans described in paragraph (1), including, as appropriate, attempts to resolve such complaints within the Department of Education and with institutions of higher education, lenders, guaranty agencies, loan servicers, and other participants in the loan programs described in paragraph (1)(A); and

`(B) compile and analyze data on borrower complaints and make appropriate recommendations.

`(4) REPORT- Each year, the Ombudsman shall submit a report to the Chief Operating Officer, for inclusion in the annual report under subsection (c)(2), that describes the activities, and evaluates the effectiveness of the Ombudsman during the preceding year.

`(g) PERSONNEL FLEXIBILITY-

`(1) PERSONNEL CEILINGS- The PBO shall not be subject to any ceiling relating to the number or grade of employees.

`(2) ADMINISTRATIVE FLEXIBILITY- The Chief Operating Officer shall work with the Office of Personnel Management to develop and implement personnel flexibilities in staffing, classification, and pay that meet the needs of the PBO, subject to compliance with title 5, United States Code.

`(3) EXCEPTED SERVICE- The Chief Operating Officer may appoint, without regard to the provisions of title 5, United States Code, governing appointments in the competitive service, not more than 25 technical and professional employees to administer the functions of the PBO. These employees 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.

`(h) ESTABLISHMENT OF A FAIR AND EQUITABLE SYSTEM FOR MEASURING STAFF PERFORMANCE- The PBO shall establish an annual performance management system, subject to compliance with title 5, United States Code and consistent with applicable provisions of law and regulations, which strengthens the organizational effectiveness of the PBO by providing for establishing goals or objectives for individual, group, or organizational performance (or any combination thereof), consistent with the performance plan of the PBO and its performance planning procedures, including those established under the Government Performance and Results Act of 1993, and communicating such goals or objectives to employees.

`(i) REPORT- The Secretary and the Chief Operating Officer, not later than 180 days after the date of enactment of the Higher Education Amendments of 1998, shall report to Congress on the proposed budget and sources of funding for the operation of the PBO.

`(j) AUTHORIZATION OF APPROPRIATIONS- The Secretary shall allocate from funds made available under section 458 such funds as are appropriate to the functions assumed by the PBO. In addition, there are authorized to be appropriated such sums as may be necessary to carry out the purposes of this part, including transition costs.

`SEC. 142. PROCUREMENT FLEXIBILITY.

`(a) PROCUREMENT AUTHORITY- Subject to the authority of the Secretary, the Chief Operating Officer of a PBO may exercise the authority of the Secretary to procure property and services in the performance of functions managed by the PBO. For the purposes of this section, the term `PBO' includes the Chief Operating Officer of the PBO and any employee of the PBO exercising procurement authority under the preceding sentence.

`(b) IN GENERAL- Except as provided in this section, the PBO shall abide by all applicable Federal procurement laws and regulations when procuring property and services. The PBO shall--

`(1) enter into contracts for information systems supporting the programs authorized under title IV to carry out the functions set forth in section 141(b)(2); and

`(2) obtain the services of experts and consultants without regard to section 3109 of title 5, United States Code and set pay in accordance with such section.

`(c) SERVICE CONTRACTS-

`(1) PERFORMANCE-BASED SERVICING CONTRACTS- The Chief Operating Officer shall, to the extent practicable, maximize the use of performance-based servicing contracts, consistent with guidelines for such contracts published by the Office of Federal Procurement Policy, to achieve cost savings and improve service.

`(2) FEE FOR SERVICE ARRANGEMENTS- The Chief Operating Officer shall, when appropriate and consistent with the purposes of the PBO, acquire services related to the title IV delivery system from any entity that has the capability and capacity to meet the requirements for the system. The Chief Operating Officer is authorized to pay fees that are equivalent to those paid by other entities to an organization that provides an information system or service that meets the requirements of the PBO, as determined by the Chief Operating Officer.

`(d) TWO-PHASE SOURCE-SELECTION PROCEDURES-

`(1) IN GENERAL- The PBO may use a two-phase process for selecting a source for a procurement of property or services.

`(2) FIRST PHASE- The procedures for the first phase of the process for a procurement are as follows:

`(A) PUBLICATION OF NOTICE- The contracting officer for the procurement shall publish a notice of the procurement in accordance with section 18 of the Office of Federal Procurement Policy Act (41 U.S.C. 416) and subsections (e), (f), and (g) of section 8 of the Small Business Act (15 U.S.C. 637), except that the notice shall include only the following:

`(i) A general description of the scope or purpose of the procurement that provides sufficient information on the scope or purpose for sources to make informed business decisions regarding whether to participate in the procurement.

`(ii) A description of the basis on which potential sources are to be selected to submit offers in the second phase.

`(iii) A description of the information that is to be required under subparagraph (B).

`(iv) Any additional information that the contracting officer determines appropriate.

`(B) INFORMATION SUBMITTED BY OFFERORS- Each offeror for the procurement shall submit basic information, such as information on the offeror's qualifications, the proposed conceptual approach, costs likely to be associated with the proposed conceptual approach, and past performance of the offeror on Federal Government contracts, together with any additional information that is requested by the contracting officer.

`(C) SELECTION FOR SECOND PHASE- The contracting officer shall select the offerors that are to be eligible to participate in the second phase of the process. The contracting officer shall limit the number of the selected offerors to the number of sources that the contracting officer determines is appropriate and in the best interests of the Federal Government.

`(3) SECOND PHASE-

`(A) IN GENERAL- The contracting officer shall conduct the second phase of the source selection process in accordance with sections 303A and 303B of the Federal Property and Administrative Services Act of 1949 (41 U.S.C. 253a and 253b).

`(B) ELIGIBLE PARTICIPANTS- Only the sources selected in the first phase of the process shall be eligible to participate in the second phase.

`(C) SINGLE OR MULTIPLE PROCUREMENTS- The second phase may include a single procurement or multiple procurements within the scope, or for the purpose, described in the notice pursuant to paragraph (2)(A).

`(4) PROCEDURES CONSIDERED COMPETITIVE- The procedures used for selecting a source for a procurement under this subsection shall be considered competitive procedures for all purposes.

`(e) USE OF SIMPLIFIED PROCEDURES FOR COMMERCIAL ITEMS- Whenever the PBO anticipates that commercial items will be offered for a procurement, the PBO may use (consistent with the special rules for commercial items) the special simplified procedures for the procurement without regard to--

`(1) any dollar limitation otherwise applicable to the use of those procedures; and

`(2) the expiration of the authority to use special simplified procedures under section 4202(e) of the Clinger-Cohen Act of 1996 (110 Stat. 654; 10 U.S.C. 2304 note).

`(f) FLEXIBLE WAIT PERIODS AND DEADLINES FOR SUBMISSION OF OFFERS OF NONCOMMERCIAL ITEMS-

`(1) AUTHORITY- In carrying out a procurement, the PBO may--

`(A) apply a shorter waiting period for the issuance of a solicitation after the publication of a notice under section 18 of the Office of Federal Procurement Policy Act (41 U.S.C. 416) than is required under subsection (a)(3)(A) of such section; and

`(B) notwithstanding subsection (a)(3) of such section, establish any deadline for the submission of bids or proposals that affords potential offerors a reasonable opportunity to respond to the solicitation.

`(2) INAPPLICABILITY TO COMMERCIAL ITEMS- Paragraph (1) does not apply to a procurement of a commercial item.

`(3) CONSISTENCY WITH APPLICABLE INTERNATIONAL AGREEMENTS- If an international agreement is applicable to the procurement, any exercise of authority under paragraph (1) shall be consistent with the international agreement.

`(g) MODULAR CONTRACTING-

`(1) IN GENERAL- The PBO may satisfy the requirements of the PBO for a system incrementally by carrying out successive procurements of modules of the system. In doing so, the PBO may use procedures authorized under this subsection to procure any such module after the first module.

`(2) UTILITY REQUIREMENT- A module may not be procured for a system under this subsection unless the module is useful independently of the other modules or useful in combination with another module previously procured for the system.

`(3) CONDITIONS FOR USE OF AUTHORITY- The PBO may use procedures authorized under paragraph (4) for the procurement of an additional module for a system if--

`(A) competitive procedures were used for awarding the contract for the procurement of the first module for the system; and

`(B) the solicitation for the first module included--

`(i) a general description of the entire system that was sufficient to provide potential offerors with reasonable notice of the general scope of future modules;

`(ii) other information sufficient for potential offerors to make informed business judgments regarding whether to submit offers for the contract for the first module; and

`(iii) a statement that procedures authorized under this subsection could be used for awarding subsequent contracts for the procurement of additional modules for the system.

`(4) PROCEDURES- If the procurement of the first module for a system meets the requirements set forth in paragraph (3), the PBO may award a contract for the procurement of an additional module for the system using any of the following procedures:

`(A) SOLE SOURCE- Award of the contract on a sole-source basis to a contractor who was awarded a contract for a module previously procured for the system under competitive procedures or procedures authorized under subparagraph (B).

`(B) ADEQUATE COMPETITION- Award of the contract on the basis of offers made by--

`(i) a contractor who was awarded a contract for a module previously procured for the system after having been selected for award of the contract under this subparagraph or other competitive procedures; and

`(ii) at least one other offeror that submitted an offer for a module previously procured for the system and is expected, on the basis of the offer for the previously procured module, to submit a competitive offer for the additional module.

`(C) OTHER- Award of the contract under any other procedure authorized by law.

`(5) NOTICE REQUIREMENT-

`(A) PUBLICATION- Not less than 30 days before issuing a solicitation for offers for a contract for a module for a system under procedures authorized under subparagraph (A) or (B) of paragraph (4), the PBO shall publish in the Commerce Business Daily a notice of the intent to use such procedures to enter into the contract.

`(B) EXCEPTION- Publication of a notice is not required under this paragraph with respect to a use of procedures authorized under paragraph (4) if the contractor referred to in that subparagraph (who is to be solicited to submit an offer) has previously provided a module for the system under a contract that contained cost, schedule, and performance goals and the contractor met those goals.

`(C) CONTENT OF NOTICE- A notice published under subparagraph (A) with respect to a use of procedures described in paragraph (4) shall contain the information required under section 18(b) of the Office of Federal Procurement Policy Act (41 U.S.C. 416(b)), other than paragraph (4) of such section, and shall invite the submission of any assertion that the use of the procedures for the procurement involved is not in the best interest of the Federal Government together with information supporting the assertion.

`(6) DOCUMENTATION- The basis for an award of a contract under this subsection shall be documented. However, a justification pursuant to section 303(f) of the Federal Property and Administrative Services Act of 1949 (41 U.S.C. 253(f)) or section 8(h) of the Small Business Act (15 U.S.C. 637(h)) is not required.

`(7) SIMPLIFIED SOURCE-SELECTION PROCEDURES- The PBO may award a contract under any other simplified procedures prescribed by the PBO for the selection of sources for the procurement of modules for a system, after the first module, that are not to be procured under a contract awarded on a sole-source basis.

`(h) USE OF SIMPLIFIED PROCEDURES FOR SMALL BUSINESS SET-ASIDES FOR SERVICES OTHER THAN COMMERCIAL ITEMS-

`(1) AUTHORITY- The PBO may use special simplified procedures for a procurement of services that are not commercial items if--

`(A) the procurement is in an amount not greater than $1,000,000;

`(B) the procurement is conducted as a small business set-aside pursuant to section 15(a) of the Small Business Act (15 U.S.C. 644(a)); and

`(C) the price charged for supplies associated with the services procured are items of supply expected to be less than 20 percent of the total contract price.

`(2) INAPPLICABILITY TO CERTAIN PROCUREMENTS- The authority set forth in paragraph (1) may not be used for--

`(A) an award of a contract on a sole-source basis; or

`(B) a contract for construction.

`(i) GUIDANCE FOR USE OF AUTHORITY-

`(1) ISSUANCE BY PBO- The Chief Operating Officer of the PBO, in consultation with the Administrator for Federal Procurement Policy, shall issue guidance for the use by PBO personnel of the authority provided in this section.

`(2) GUIDANCE FROM OFPP- As part of the consultation required under paragraph (1), the Administrator for Federal Procurement Policy shall provide the PBO with guidance that is designed to ensure, to the maximum extent practicable, that the authority under this section is exercised by the PBO in a manner that is consistent with the exercise of the authority by the heads of the other performance-based organizations.

`(3) COMPLIANCE WITH OFPP GUIDANCE- The head of the PBO shall ensure that the procurements of the PBO under this section are carried out in a manner that is consistent with the guidance provided for the PBO under paragraph (2).

`(j) LIMITATION ON MULTIAGENCY CONTRACTING- No department or agency of the Federal Government may purchase property or services under contracts entered into or administered by a PBO under this section unless the purchase is approved in advance by the senior procurement official of that department or agency who is responsible for purchasing by the department or agency.

`(k) LAWS NOT AFFECTED- Nothing in this section shall be construed to waive laws for the enforcement of civil rights or for the establishment and enforcement of labor standards that are applicable to contracts of the Federal Government.

`(l) DEFINITIONS- In this section:

`(1) COMMERCIAL ITEM- The term `commercial item' has the meaning given the term in section 4(12) of the Office of Federal Procurement Policy Act (41 U.S.C. 403(12)).

`(2) COMPETITIVE PROCEDURES- The term `competitive procedures' has the meaning given the term in section 309(b) of the Federal Property and Administrative Services Act of 1949 (41 U.S.C. 259(b)).

`(3) SOLE-SOURCE BASIS- The term `sole-source basis', with respect to an award of a contract, means that the contract is awarded to a source after soliciting an offer or offers from, and negotiating with, only that source.

`(4) SPECIAL RULES FOR COMMERCIAL ITEMS- The term `special rules for commercial items' means the regulations set forth in the Federal Acquisition Regulation pursuant to section 303(g)(1) of the Federal Property and Administrative Services Act of 1949 (41 U.S.C. 253(g)(1)) and section 31 of the Office of Federal Procurement Policy Act (41 U.S.C. 427).

`(5) SPECIAL SIMPLIFIED PROCEDURES- The term `special simplified procedures' means the procedures applicable to purchases of property and services for amounts not greater than the simplified acquisition threshold that are set forth in the Federal Acquisition Regulation pursuant to section 303(g)(1)(B) of the Federal Property and Administrative Services Act of 1949 (41 U.S.C. 253(g)(1)(A)) and section 31(a)(1) of the Office of Federal Procurement Policy Act (41 U.S.C. 427(a)(1)).

`SEC. 143. ADMINISTRATIVE SIMPLIFICATION OF STUDENT AID DELIVERY.

`(a) IN GENERAL- In order to improve the efficiency and effectiveness of the student aid delivery system, the Secretary and the Chief Operating Officer shall encourage and participate in the establishment of voluntary consensus standards and requirements for the electronic transmission of information necessary for the administration of programs under title IV.

`(b) PARTICIPATION IN STANDARD SETTING ORGANIZATIONS-

`(1) The Chief Operating Officer shall participate in the activities of standard setting organizations in carrying out the provisions of this section.

`(2) The Chief Operating Officer shall encourage higher education groups seeking to develop common forms, standards, and procedures in support of the delivery of Federal student financial assistance to conduct these activities within a standard setting organization.

`(3) The Chief Operating Officer may pay necessary dues and fees associated with participating in standard setting organizations pursuant to this subsection.

`(c) ADOPTION OF VOLUNTARY CONSENSUS STANDARDS- Except with respect to the common financial reporting form under section 483(a), the Secretary shall consider adopting voluntary consensus standards agreed to by the organization described in subsection (b) for transactions required under title IV, and common data elements for such transactions, to enable information to be exchanged electronically between systems administered by the Department and among participants in the Federal student aid delivery system.

`(d) USE OF CLEARINGHOUSES- Nothing in this section shall restrict the ability of participating institutions and lenders from using a clearinghouse or servicer to comply with the standards for the exchange of information established under this section.

`(e) DATA SECURITY- Any entity that maintains or transmits information under a transaction covered by this section shall maintain reasonable and appropriate administrative, technical, and physical safeguards--

`(1) to ensure the integrity and confidentiality of the information; and

`(2) to protect against any reasonably anticipated security threats, or unauthorized uses or disclosures of the information.

`(f) DEFINITIONS-

`(1) CLEARINGHOUSE- The term `clearinghouse' means a public or private entity that processes or facilitates the processing of nonstandard data elements into data elements conforming to standards adopted under this section.

`(2) STANDARD SETTING ORGANIZATION- The term `standard setting organization' means an organization that--

`(A) is accredited by the American National Standards Institute;

`(B) develops standards for information transactions, data elements, or any other standard that is necessary to, or will facilitate, the implementation of this section; and

`(C) is open to the participation of the various entities engaged in the delivery of Federal student financial assistance.

`(3) VOLUNTARY CONSENSUS STANDARD- The term `voluntary consensus standard' means a standard developed or used by a standard setting organization described in paragraph (2).'.

(b) REPEAL OF OLD GENERAL PROVISIONS- Title XII (20 U.S.C. 1141 et seq.) is repealed.

(c) REPEAL OF TITLE IV DEFINITION- Section 481 (20 U.S.C. 1088) is amended--

(1) by striking subsections (a), (b), and (c); and

(2) by redesignating subsections (d) through (f) as subsections (a) through (c), respectively.

SEC. 102. CONFORMING AMENDMENTS.

(a) CONFORMING AMENDMENTS CORRECTING REFERENCES TO SECTION 1201-

(1) AGRICULTURE-

(A) STUDENT INTERNSHIP PROGRAMS- Section 922 of the Federal Agriculture Improvement and Reform Act of 1996 (7 U.S.C. 2279c) is amended--

(i) in subsection (a)(1)(B)--

(I) by striking `1201' and inserting `101'; and

(II) by striking `(20 U.S.C. 1141)'; and

(ii) in subsection (b)(1)--

(I) by striking `1201' and inserting `101'; and

(II) by striking `(20 U.S.C. 1141)'.

(B) AGRICULTURAL SCIENCES EDUCATION- Section 1417(j)(1)(A) of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3152(j)(1)(A)) is amended--

(i) by striking `1201(a)' and inserting `101'; and

(ii) by striking `(20 U.S.C. 1141(a))'.

(2) ARMED FORCES-

(A) SCIENCE AND MATHEMATICS EDUCATION IMPROVEMENT PROGRAM- Section 2193(c)(1) of title 10, United States Code, is amended--

(i) by striking `1201(a)' and inserting `101'; and

(ii) by striking `(20 U.S.C. 1141(a))'.

(B) SUPPORT OF SCIENCE, MATHEMATICS, AND ENGINEERING EDUCATION- Section 2199(2) of title 10, United States Code, is amended--

(i) by striking `1201(a)' and inserting `101'; and

(ii) by striking `(20 U.S.C. 1141(a))'.

(C) ALLOWABLE COSTS UNDER DEFENSE CONTRACTS- Section 841(c)(2) of the National Defense Authorization Act for fiscal year 1994 (10 U.S.C. 2324 note) is amended--

(i) by striking `1201(a)' and inserting `101'; and

(ii) by striking `(20 U.S.C. 1141(a))'.

(D) ENVIRONMENTAL RESTORATION INSTITUTIONAL GRANTS FOR TRAINING DISLOCATED DEFENSE WORKERS AND YOUNG ADULTS- Section 1333(i)(3) of the National Defense Authorization Act for fiscal year 1994 (10 U.S.C. 2701 note) is amended--

(i) by striking `1201(a)' and inserting `101'; and

(ii) by striking `(20 U.S.C. 1141(a))'.

(E) ENVIRONMENTAL EDUCATION OPPORTUNITIES PROGRAM- Section 1334(k)(3) of the National Defense Authorization Act for fiscal year 1994 (10 U.S.C. 2701 note) is amended--

(i) by striking `1201(a)' and inserting `101'; and

(ii) by striking `(20 U.S.C. 1141(a))'.

(F) ENVIRONMENTAL SCHOLARSHIP AND FELLOWSHIP PROGRAMS- Section 4451(b)(1) of the National Defense Authorization Act for 1993 (10 U.S.C. 2701 note) is amended--

(i) by striking `1201(a)' and inserting `101'; and

(ii) by striking `(20 U.S.C. 1141(a))'.

(3) APPLICATION OF ANTITRUST LAWS TO AWARD OF NEED-BASED EDUCATIONAL AID- Section 568(c)(3) of the Improving America's Schools Act of 1994 (15 U.S.C. 1 note) is amended--

(A) by striking `1201(a)' and inserting `101'; and

(B) by striking `(20 U.S.C. 1141(a))'.

(4) OMNIBUS PARKS AND PUBLIC LANDS MANAGEMENT ACT OF 1996- Section 1007(c)(5) of the Omnibus Parks and Public Lands Management Act of 1996 (16 U.S.C. 698u-5) is amended by striking `1201(a) of the Higher Education Act of 1965 (20 U.S.C. 1141(a))' and inserting `101 of the Higher Education Act of 1965'.

(5) RESTRICTIONS ON FORMER OFFICERS, EMPLOYEES, AND ELECTED OFFICIALS OF THE EXECUTIVE AND LEGISLATIVE BRANCHES- Section 207(j)(2)(B) of title 18, United States Code, is amended by striking `1201(a)' and inserting `101'.

(6) EDUCATION-

(A) HIGHER EDUCATION AMENDMENTS OF 1992- Section 1(c) of the Higher Education Amendments of 1992 (20 U.S.C. 1001 note) is amended by striking `1201' and inserting `101'.

(B) TREATMENT OF BRANCHES- Section 498(j)(2) of the Higher Education Act of 1965 (20 U.S.C. 1099c(j)(2)) is amended by striking `1201(a)(2)' and inserting `101(a)(2)'.

(C) DISCLOSURE REQUIREMENTS- Section 429(d)(2)(B)(ii) of the General Education Provisions Act (20 U.S.C. 1228c(d)(2)(B)(ii)) is amended by striking `1201(a)' and inserting `101'.

(D) HARRY S. TRUMAN SCHOLARSHIPS- Section 3(4) of the Harry S. Truman Memorial Scholarship Act (20 U.S.C. 2002(4)) is amended by striking `1201(a)' and inserting `101'.

(E) TECH-PREP EDUCATION- Section 347(2)(A) of the Carl D. Perkins Vocational and Applied Technology Education Act (20 U.S.C. 2394e(2)(A)) is amended by striking `1201(a)' and inserting `101'.

(F) EDUCATION FOR ECONOMIC SECURITY- Section 3(6) of the Education for Economic Security Act (20 U.S.C. 3902(6)) is amended by striking `1201(a)' and inserting `101'.

(G) JAMES MADISON MEMORIAL FELLOWSHIPS- Section 815 of the James Madison Memorial Fellowship Act (20 U.S.C. 4514) is amended--

(i) in paragraph (3), by striking `1201(a)' and inserting `101'; and

(ii) in paragraph (4), by striking `1201(d) of the Higher Education Act of 1965' and inserting `14101 of the Elementary and Secondary Education Act of 1965'.

(H) BARRY GOLDWATER SCHOLARSHIPS- Section 1403(4) of the Barry Goldwater Scholarship and Excellence in Education Act (20 U.S.C. 4702(4)) is amended--

(i) by striking `1201(a)' and inserting `101'; and

(ii) by striking `(20 U.S.C. 1141(a))'.

(I) MORRIS K. UDALL SCHOLARSHIPS- Section 4(6) of the Morris K. Udall Scholarship and Excellence in National Environmental and Native American Public Policy Act of 1992 (20 U.S.C. 5602(6)) is amended by striking `1201(a)' and inserting `101'.

(J) BILINGUAL EDUCATION, AND LANGUAGE ENHANCEMENT AND ACQUISITION- Section 7501(4) of the Elementary and Secondary Education Act of 1965 (20 U.S.C. 7601(4)) is amended by striking `1201(a)' and inserting `101'.

(K) GENERAL DEFINITIONS- Section 14101(17) of the Elementary and Secondary Education Act of 1965 (20 U.S.C. 8801(17)) is amended by striking `1201(a)' and inserting `101'.

(L) NATIONAL EDUCATION STATISTICS- Section 402(c)(3) of the National Education Statistics Act of 1994 (20 U.S.C. 9001(c)(3)) is amended by striking `1201(a)' and inserting `101'.

(7) FOREIGN RELATIONS-

(A) ENVIRONMENT AND SUSTAINABLE DEVELOPMENT EXCHANGE PROGRAM- Section 240(d) of the Foreign Relations Authorization Act, Fiscal Years 1994 and 1995 (22 U.S.C. 2452 note) is amended by striking `1201(a)' and inserting `101'.

(B) SAMANTHA SMITH MEMORIAL EXCHANGE PROGRAM- Section 112(a)(8) of the Mutual Educational and Cultural Exchange Act of 1961 (22 U.S.C. 2460(a)(8)) is amended--

(i) by striking `1201(a)' and inserting `101'; and

(ii) by striking `(20 U.S.C. 1141(a))'.

(C) SOVIET-EASTERN EUROPEAN TRAINING- Section 803(1) of the Soviet-Eastern European Research and Training Act of 1983 (22 U.S.C. 4502(1)) is amended by striking `1201(a)' and inserting `101'.

(D) DEVELOPING COUNTRY SCHOLARSHIPS- Section 603(d) of the Foreign Relations Authorization Act, Fiscal Years 1986 and 1987 (22 U.S.C. 4703(d)) is amended by striking `1201(a)' and inserting `101'.

(8) INDIANS-

(A) SNYDER ACT- The last paragraph of section 410 of the Act entitled `An Act authorizing appropriations and expenditures for the administration of Indian Affairs, and for other purposes', approved November 2, 1921 (25 U.S.C. 13) (commonly known as the Snyder Act) is amended by striking `1201' and inserting `101'.

(B) TRIBALLY CONTROLLED COMMUNITY COLLEGE ASSISTANCE- Section 2(a)(5) of the Tribally Controlled Community College Assistance Act (25 U.S.C. 1801(a)(5)) is amended by striking `1201(a)' and inserting `101'.

(C) CONSTRUCTION OF NEW FACILITIES- Section 113(b)(2) of the Tribally Controlled Community College Assistance Act (25 U.S.C. 1813(b)(2)) is amended--

(i) by striking `1201(a)' and inserting `101'; and

(ii) by striking `(20 U.S.C. 1141(a))'.

(D) AMERICAN INDIAN TEACHER TRAINING- Section 1371(a)(1)(B) of the Higher Education Amendments of 1992 (25 U.S.C. 3371(a)(1)(B)) is amended by striking `1201(a)' and inserting `101'.

(9) LABOR-

(A) REHABILITATION DEFINITIONS- Section 6(23) of the Rehabilitation Act of 1973 (29 U.S.C. 705(23)) is amended--

(i) by striking `1201(a)' and inserting `101'; and

(ii) by striking `(20 U.S.C. 1141(a))'.

(B) TECHNOLOGY RELATED ASSISTANCE FOR INDIVIDUALS WITH DISABILITIES ACT OF 1988- Section 3(8) of the Technology Related Assistance for Individuals with Disabilities Act of 1988 (29 U.S.C. 2202(8)) is amended by striking `1201(a) of the Higher Education Act of 1965 (20 U.S.C. 1141(a))' and inserting `101 of the Higher Education Act of 1965'.

(10) SURFACE MINING CONTROL- Section 701(32) of the Surface Mining Control and Reclamation Act of 1977 (30 U.S.C. 1291(32)) is amended by striking `1201(a)' and inserting `101'.

(11) POLLUTION PREVENTION- Section 112(a)(1) of the Federal Water Pollution Control Act (33 U.S.C. 1262(a)(1)) is amended by striking `1201' and inserting `101'.

(12) POSTAL SERVICE- Section 3626(b)(3) of title 39, United States Code, is amended--

(A) by striking `1201(a)' and inserting `101'; and

(B) by striking `(20 U.S.C. 1141(a))'.

(13) PUBLIC HEALTH AND WELFARE-

(A) PUBLIC HEALTH SERVICE ACT- Section 705(a)(2)(C) of the Public Health Service Act (42 U.S.C. 292d(a)(2)(C)) is amended by striking `section 481(a)' and inserting `section 102(a)'.

(B) SCIENTIFIC AND TECHNICAL EDUCATION- Section 3(g) of the Scientific and Advanced-Technology Act of 1992 (42 U.S.C. 1862i(g)) is amended--

(i) in paragraph (2)--

(I) by striking `1201(a)' and inserting `101'; and

(II) by striking `(20 U.S.C. 1141(a))'; and

(ii) in paragraph (3)--

(I) by striking `1201(a)' and inserting `101'; and

(II) by striking `(20 U.S.C. 1141(a))'.

(C) OLDER AMERICANS- Section 102(32) of the Older Americans Act of 1965 (42 U.S.C. 3002(32)) is amended--

(i) by striking `1201(a)' and inserting `101'; and

(ii) by striking `(20 U.S.C. 1141(a))'.

(D) JUSTICE SYSTEM IMPROVEMENT- Section 901(17) of the Omnibus Crime Control and Safe Streets Act of 1968 (42 U.S.C. 3791(17)) is amended--

(i) by striking `1201(a)' and inserting `101'; and

(ii) by striking `(20 U.S.C. 1141(a))'.

(E) ENERGY TECHNOLOGY COMMERCIALIZATION SERVICES PROGRAM- Section 362(f)(5)(A) of the Energy Policy and Conservation Act (42 U.S.C. 6322(f)(5)(A)) is amended--

(i) by striking `1201(a)' and inserting `101'; and

(ii) by striking `(20 U.S.C. 1141(a))'.

(F) ENVIRONMENTAL RESTORATION AND WASTE MANAGEMENT- Section 3132(b)(1) of the National Defense Authorization Act for Fiscal Years 1992 and 1993 (42 U.S.C. 7274e(b)(1)) is amended--

(i) by striking `1201(a)' and inserting `101'; and

(ii) by striking `(20 U.S.C. 1141(a))'.

(G) HEAD START- Section 649(c)(3) of the Head Start Act (42 U.S.C. 9844(c)(3)) is amended--

(i) by striking `1201(a)' and inserting `101'; and

(ii) by striking `(20 U.S.C. 1141(a))'.

(H) STATE DEPENDENT CARE DEVELOPMENT GRANTS- Section 670G(5) of the Child Care and Development Block Grant Act of 1990 (42 U.S.C. 9877(5)) is amended by striking `1201(a)' and inserting `101'.

(I) INSTRUCTIONAL ACTIVITIES FOR LOW-INCOME YOUTH- The matter preceding subparagraph (A) of section 682(b)(1) of the Community Services Block Grant Act (42 U.S.C. 9910c(b)(1)) is amended by striking `1201(a)' and inserting `101'.

(J) DRUG ABUSE EDUCATION- Section 3601(7) of the Anti-Drug Abuse Act of 1988 (42 U.S.C. 11851(7)) is amended--

(i) by striking `1201(a)' and inserting `101'; and

(ii) by striking `(20 U.S.C. 1141(a))'.

(K) NATIONAL AND COMMUNITY SERVICE- Section 101(13) of the National and Community Service Act of 1990 (42 U.S.C. 12511(13)) is amended--

(i) by striking `1201(a)' and inserting `101'; and

(ii) by striking `(20 U.S.C. 1141(a))'.

(L) CIVILIAN COMMUNITY CORPS- Section 166(6) of the National and Community Service Act of 1990 (42 U.S.C. 12626(6)) is amended--

(i) by striking `1201(a)' and inserting `101'; and

(ii) by striking `(20 U.S.C. 1141(a))'.

(M) CRANSTON-GONZALEZ NATIONAL AFFORDABLE HOUSING ACT- Section 457(9) of the Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. 12899f(9)) is amended by striking `1201(a)' and inserting `101'.

(N) COMMUNITY SCHOOLS YOUTH SERVICES AND SUPERVISION GRANT PROGRAM- The definition of public school in section 30401(b) of the Community Schools Youth Services and Supervision Grant Program Act of 1994 (42 U.S.C. 13791(b)) is amended--

(i) by striking `1201' each place the term appears and inserting `101'; and

(ii) by striking `(20 U.S.C. 1141(i))'.

(O) POLICE CORPS- The definition of institution of higher education in section 200103 of the Police Corps Act (42 U.S.C. 14092) is amended--

(i) by striking `1201(a)' and inserting `101'; and

(ii) by striking `(20 U.S.C. 1141(a))'.

(P) LAW ENFORCEMENT SCHOLARSHIP PROGRAM- The definition of institution of higher education in section 200202 of the Law Enforcement Scholarship and Recruitment Act (42 U.S.C. 14111) is amended--

(i) by striking `1201(a)' and inserting `101'; and

(ii) by striking `(20 U.S.C. 1141(a))'.

(14) TELECOMMUNICATIONS- Section 223(h)(4) of the Telecommunications Act of 1934 (47 U.S.C. 223(h)(4)) is amended--

(A) by striking `1201' and inserting `101'; and

(B) by striking `(20 U.S.C. 1141)'.

(15) WAR AND NATIONAL DEFENSE- Section 808(3) of the David L. Boren National Security Education Act of 1991 (50 U.S.C. 1908(3)) is amended--

(A) by striking `1201(a)' and inserting `101'; and

(B) by striking `(20 U.S.C. 1141(a))'.

(b) INTERNAL CROSS REFERENCES- The Act (20 U.S.C. 1001 et seq.) is amended--

(1) in section 402A(c)(2) (20 U.S.C. 1070a-11(c)(2)), by striking `1210' and inserting `118';

(2) in section 435(a) (20 U.S.C. 1085(a)), by striking `section 481' and inserting `section 102';

(3) in section 485(f)(1)(I) (20 U.S.C. 1092(f)(1)(I)), by striking `1213' and inserting `120';

(4) in section 487(d) (20 U.S.C. 1094(d)), by striking `section 481' and inserting `section 102';

(5) in subsections (j) and (k) of section 496 (20 U.S.C. 1099b), by striking `section 481' each place the term appears and inserting `section 102';

(6) in section 498(i) (20 U.S.C. 1099c) is amended by striking `section 481' and inserting `section 102';

(7) in section 498(j) (20 U.S.C. 1099c(j))--

(A) in paragraph (1), by striking `sections 481(b)(5) and 481(c)(3)' and inserting `sections 102(b)(1)(E) and 102(c)(1)(C)'; and

(B) in paragraph (2), by striking `1201(a)(2)' and inserting `101(a)(2)'; and

(8) in section 631(a)(8) (20 U.S.C. 1132(a)(8))--

(A) by striking `section 1201(a)' each place the term appears and inserting `section 101'; and

(B) by striking `of 1201(a)' and inserting `of section 101'.

(c) ADDITIONAL CONFORMING AMENDMENTS CORRECTING REFERENCES TO SECTION 481-

(1) SCHOOL-TO-WORK OPPORTUNITIES ACT OF 1994- Section 4 of the School-to-Work Opportunities Act of 1994 (20 U.S.C. 6103) is amended--

(A) in paragraph (11)(B)(viii), by striking `section 481(b)' and inserting `section 102(b)'; and

(B) in paragraph (12), by striking `section 481' and inserting `section 102'.

(2) NATIONAL AND COMMUNITY SERVICE ACT OF 1990- Section 148(g) of the National and Community Service Act of 1990 (42 U.S.C. 12604(g)) is amended by striking `section 481(a) of the Higher Education Act of 1965 (20 U.S.C. 1088(a))' and inserting `section 102 of the Higher Education Act of 1965'.

(d) WORKFORCE INVESTMENT ACT OF 1998- The Workforce Investment Act of 1998 is amended--

(1) in section 101(35) (29 U.S.C. 2801(35)), by striking `section 481 of the Higher Education Act of 1965 (20 U.S.C. 1088)' and inserting `section 102 of the Higher Education Act of 1965'; and

(2) in section 203(11) (20 U.S.C. 9202(11)), by striking `section 1201 of the Higher Education Act of 1965 (20 U.S.C. 1141)' and inserting `section 101 of the Higher Education Act of 1965'.

SEC. 201. TEACHER QUALITY ENHANCEMENT GRANTS.

The Act is amended by inserting after title I (20 U.S.C. 1001 et seq.) the following:

`SEC. 201. PURPOSES; DEFINITIONS.

`(a) PURPOSES- The purposes of this title are to--

`(1) improve student achievement;

`(2) improve the quality of the current and future teaching force by improving the preparation of prospective teachers and enhancing professional development activities;

`(3) hold institutions of higher education accountable for preparing teachers who have the necessary teaching skills and are highly competent in the academic content areas in which the teachers plan to teach, such as mathematics, science, English, foreign languages, history, economics, art, civics, Government, and geography, including training in the effective uses of technology in the classroom; and

`(4) recruit highly qualified individuals, including individuals from other occupations, into the teaching force.

`(b) DEFINITIONS- In this title:

`(1) ARTS AND SCIENCES- The term `arts and sciences' means--

`(A) when referring to an organizational unit of an institution of higher education, any academic unit that offers 1 or more academic majors in disciplines or content areas corresponding to the academic subject matter areas in which teachers provide instruction; and

`(B) when referring to a specific academic subject matter area, the disciplines or content areas in which academic majors are offered by the arts and science organizational unit.

`(2) HIGH NEED LOCAL EDUCATIONAL AGENCY- The term `high need local educational agency' means a local educational agency that serves an elementary school or secondary school located in an area in which there is--

`(A) a high percentage of individuals from families with incomes below the poverty line;

`(B) a high percentage of secondary school teachers not teaching in the content area in which the teachers were trained to teach; or

`(C) a high teacher turnover rate.

`(3) POVERTY LINE- The term `poverty line' means the poverty line (as defined by the Office of Management and Budget, and revised annually in accordance with section 673(2) of the Community Services Block Grant Act (42 U.S.C. 9902(2))) applicable to a family of the size involved.

`SEC. 202. STATE GRANTS.

`(a) IN GENERAL- From amounts made available under section 210(1) for a fiscal year, the Secretary is authorized to award grants under this section, on a competitive basis, to eligible States to enable the eligible States to carry out the activities d