Making College More Affordable Act

I 116TH CONGRESS 1ST SESSION H. R. 4747 To carry out an income-contingent repayment program for Federal Interest Free Education Loans for undergraduate students, and for other purposes. IN THE HOUSE OF REPRESENTATIVES OCTOBER 18, 2019 Mr. CICILLINE (for himself, Ms. SCHAKOWSKY, Mr. SERRANO, and Ms. JACK- SON LEE) introduced the following bill; which was referred to the Com- mittee on Education and Labor A BILL To carry out an income-contingent repayment program for Federal Interest Free Education Loans for under- graduate students, and for other purposes. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Making College More 4 Affordable Act’’. 5 VerDate Sep 11 2014 02:51 Oct 24, 2019 Jkt 099200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H4747.IH H4747 pamtmann on DSKBC07HB2PROD with BILLS 2 •HR 4747 IH SEC. 2. DIRECT FEDERAL UNDERGRADUATE LOANS AND 1 REPAYMENT PLAN. 2 (a) INTEREST RATES.—Section 455(a) of the Higher 3 Education Act of 1965 (20 U.S.C. 1087e(a)) is amended 4 by adding at the end the following: 5 ‘‘(4) UNDERGRADUATE LOANS ON OR AFTER 6 THE DATE OF ENACTMENT OF THE MAKING COL- 7 LEGE MORE AFFORDABLE ACT.— 8 ‘‘(A) IN GENERAL.—Notwithstanding any 9 other provision of this Act, a new borrower on 10 or after the date of enactment of the Making 11 College More Affordable Act may only borrow a 12 Federal Interest Free Education Loan for the 13 undergraduate course work being pursued by 14 such borrower. 15 ‘‘(B) TERMS, CONDITIONS, AND BENE- 16 FITS.—A Federal Interest Free Education 17 Loan shall have the same terms and conditions, 18 and benefits to borrowers as Federal Direct 19 Stafford Loans with respect to undergraduate 20 borrowers, except that— 21 ‘‘(i) a Federal Interest Free Edu- 22 cation Loan shall have an applicable rate 23 of interest of 3.76 percent for the term of 24 the loan; 25 VerDate Sep 11 2014 02:51 Oct 24, 2019 Jkt 099200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H4747.IH H4747 pamtmann on DSKBC07HB2PROD with BILLS 3 •HR 4747 IH ‘‘(ii) the aggregate maximum amount 1 of Federal Interest Free Education Loan 2 that may be awarded to a borrower shall 3 be $90,000, for not more than a 4-year 4 academic period; 5 ‘‘(iii) interest on a Federal Interest 6 Free Education Loan shall only accrue 7 during periods when a borrower is not 8 earning taxable income due to professional 9 negligence, professional incompetence, or 10 malicious action on the part of the bor- 11 rower; 12 ‘‘(iv) a borrower may consolidate any 13 loan under section 428B, or a Federal Di- 14 rect PLUS Loan, that is made, insured, or 15 guaranteed on behalf of such borrower 16 with the Federal Interest Free Education 17 Loan of such borrower; 18 ‘‘(v) a Federal Interest Free Edu- 19 cation Loan may only be repaid under the 20 income-contingent repayment plan under 21 subsection (r); and 22 ‘‘(vi) the Secretary may determine 23 other terms and conditions, and benefits to 24 VerDate Sep 11 2014 02:51 Oct 24, 2019 Jkt 099200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H4747.IH H4747 pamtmann on DSKBC07HB2PROD with BILLS 4 •HR 4747 IH borrowers of Federal Interest Free Edu- 1 cation Loan.’’. 2 (b) INCOME-CONTINGENT REPAYMENT PLAN FOR 3 UNDERGRADUATE LOANS.—Section 455 of the Higher 4 Education Act of 1965 (20 U.S.C. 1087e) is further 5 amended by adding at the end the following: 6 ‘‘(r) INCOME-CONTINGENT REPAYMENT PLAN FOR 7 UNDERGRADUATE LOANS.—Notwithstanding any other 8 provision of this Act, the Secretary shall carry out a pro- 9 gram under which— 10 ‘‘(1) a borrower of a Federal Interest Free 11 Education Loan— 12 ‘‘(A) shall have an aggregate monthly pay- 13 ment for the outstanding balance of principal 14 and interest due on all such loans automatically 15 withheld from the pre-tax income of the bor- 16 rower by the employer of the borrower in a 17 manner which— 18 ‘‘(i) prohibits employers from using 19 any information about an employee’s out- 20 standing balance or principal and interest 21 due on such loans for any purpose of use 22 as an advantage against the employee; 23 ‘‘(ii) is determined by the Secretary, 24 in coordination with the heads of other ap- 25 VerDate Sep 11 2014 02:51 Oct 24, 2019 Jkt 099200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H4747.IH H4747 pamtmann on DSKBC07HB2PROD with BILLS 5 •HR 4747 IH propriate Federal agencies (including the 1 Secretary of the Treasury and the Com- 2 missioner of the Social Security Adminis- 3 tration); and 4 ‘‘(iii) is an amount equal to— 5 ‘‘(I) if the borrower’s gross in- 6 come is less than 337 percent of the 7 poverty line applicable to the bor- 8 rower’s family size as determined 9 under section 673(2) of the Commu- 10 nity Services Block Grant Act (42 11 U.S.C. 9902(2)), $0; 12 ‘‘(II) if the borrower’s gross in- 13 come is equal to or greater than 337 14 percent, but not more than 841 per- 15 cent of such poverty line, 4 percent of 16 the borrower’s gross income; 17 ‘‘(III) if the borrower’s gross in- 18 come is equal to or greater than 842 19 percent, but not more than 925 per- 20 cent of such poverty line, 5 percent of 21 the borrower’s gross income; 22 ‘‘(IV) if the borrower’s gross in- 23 come is equal to or greater than 926 24 percent, but not more than 1,010 per- 25 VerDate Sep 11 2014 02:51 Oct 24, 2019 Jkt 099200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H4747.IH H4747 pamtmann on DSKBC07HB2PROD with BILLS 6 •HR 4747 IH cent of such poverty line, 6 percent of 1 the borrower’s gross income; 2 ‘‘(V) if the borrower’s gross in- 3 come is equal to or greater than 1,011 4 percent, but not more than 1,094 per- 5 cent of such poverty line, 7 percent of 6 the borrower’s gross income; 7 ‘‘(VI) if the borrower’s gross in- 8 come is equal to or greater than 1,095 9 percent, but not more than 1,178 per- 10 cent of such poverty line, 8 percent of 11 the borrower’s gross income; 12 ‘‘(VII) if the borrower’s gross in- 13 come is equal to or greater than 1,179 14 percent, and 1,262 percent of such 15 poverty line, 9 percent of the bor- 16 rower’s gross income; and 17 ‘‘(VIII) if the borrower’s gross 18 income is equal to or greater than 19 1,263 percent of such poverty line, 10 20 percent of the borrower’s gross in- 21 come; and 22 ‘‘(B) may elect to have any payments made 23 under subparagraph (A) that exceed the 24 amount owed by the borrower on such loans for 25 VerDate Sep 11 2014 02:51 Oct 24, 2019 Jkt 099200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H4747.IH H4747 pamtmann on DSKBC07HB2PROD with BILLS 7 •HR 4747 IH a calendar year be refunded to the borrower or 1 applied to the amount owed by the borrower on 2 such loans for the succeeding calendar year; 3 ‘‘(2) the Secretary will cancel any outstanding 4 balance of principal or interest due on all Federal 5 Interest Free Education Loans made to a borrower 6 who has made 300 monthly payments under this 7 subsection; and 8 ‘‘(3) a borrower will be taxed on the amount 9 cancelled under paragraph (2), which taxes shall be 10 applied to carry out the Federal Direct Loan pro- 11 gram under this part.’’. 12 Æ VerDate Sep 11 2014 02:51 Oct 24, 2019 Jkt 099200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6301 E:\BILLS\H4747.IH H4747 pamtmann on DSKBC07HB2PROD with BILLS