COVID–19 Perkins Loan Relief Act

I 116TH CONGRESS 2D SESSION H. R. 7294 To suspend Federal Perkins Loans repayments during the COVID–19 pandemic, and for other purposes. IN THE HOUSE OF REPRESENTATIVES JUNE 22, 2020 Ms. PORTER (for herself, Ms. STEFANIK, Mrs. TRAHAN, Ms. ADAMS, and Mrs. LEE of Nevada) introduced the following bill; which was referred to the Committee on Education and Labor, and in addition to the Committees on the Judiciary, and Ways and Means, for a period to be subsequently determined by the Speaker, in each case for consideration of such provi- sions as fall within the jurisdiction of the committee concerned A BILL To suspend Federal Perkins Loans repayments during the COVID–19 pandemic, 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 ‘‘COVID–19 Perkins 4 Loan Relief Act’’. 5 SEC. 2. LOWERING RATES FOR BORROWERS WITH FED- 6 ERAL PERKINS LOANS. 7 (a) SUSPENSION OF INTEREST.— 8 VerDate Sep 11 2014 04:34 Jul 11, 2020 Jkt 099200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H7294.IH H7294 kjohnson on DSK79L0C42PROD with BILLS 2 •HR 7294 IH (1) SUSPENSION OF INTEREST.—The Secretary 1 of Education shall require holders of Federal Per- 2 kins Loans to suspend the accrual of interest on 3 such loans during the COVID–19 pandemic. 4 (2) REQUIREMENTS.—Under the program and 5 effective as of March 13, 2020, all holders of Fed- 6 eral Perkins Loans shall— 7 (A) provide that no interest shall accrue on 8 Federal Perkins Loans until September 30, 9 2020; and 10 (B) provide a report to the Secretary of 11 Education not later than 30 days after the date 12 of the enactment of this Act confirming that no 13 interest has accrued on such loans as of March 14 13, 2020. 15 (3) REPAYMENT OF INTEREST.—The Secretary 16 of Education shall make payments to the holders of 17 Federal Perkins Loans on behalf of each borrower of 18 such a Federal Perkins Loan in an amount equal to 19 the total amount of the interest suspended under 20 paragraph (1) with respect to such Federal Perkins 21 Loan. 22 (b) SUSPENSION OF PAYMENTS.— 23 (1) IN GENERAL.—Notwithstanding any other 24 provision of the Higher Education Act of 1965 (20 25 VerDate Sep 11 2014 04:34 Jul 11, 2020 Jkt 099200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H7294.IH H7294 kjohnson on DSK79L0C42PROD with BILLS 3 •HR 7294 IH U.S.C. 1071 et seq.), the Secretary of Education 1 shall require institutions of higher education to sus- 2 pend all payments due from borrowers through Sep- 3 tember 30, 2020. 4 (2) CONSIDERATION OF PAYMENTS.—Notwith- 5 standing any other provision of the Higher Edu- 6 cation Act of 1965 (20 U.S.C. 1001 et seq.), the 7 Secretary of Education shall deem each month for 8 which a loan payment was suspended under this 9 subsection as if the borrower of the loan had made 10 a qualified payment for the purpose of any loan for- 11 giveness program and loan rehabilitation program 12 authorized under the Higher Education Act of 1965 13 (20 U.S.C. 1071 et seq.). 14 (3) REPORTING TO CONSUMER REPORTING 15 AGENCIES.—During the period in which the bor- 16 rower payments on a loan are suspended under this 17 subsection, the Secretary of Education shall ensure 18 that, for the purpose of reporting information about 19 the loan to a consumer reporting agency, any pay- 20 ment that has been suspended is treated as if it 21 were a regularly scheduled payment made by a bor- 22 rower. 23 (c) SUSPENSION OF INVOLUNTARY COLLECTION.— 24 VerDate Sep 11 2014 04:34 Jul 11, 2020 Jkt 099200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H7294.IH H7294 kjohnson on DSK79L0C42PROD with BILLS 4 •HR 7294 IH (1) COLLECTION BY INSTITUTIONS.—Notwith- 1 standing any other provision of the Higher Edu- 2 cation Act of 1965 (20 U.S.C. 1071 et seq.), the 3 Secretary of Education shall require that institutions 4 of higher education to suspend all involuntary collec- 5 tion related to Federal Perkins Loans, through Sep- 6 tember 30, 2020, including collecting a past due 7 Federal Perkins Loan, assign any Federal Perkins 8 Loan to a collection agency, or litigating with re- 9 spect to such loan. 10 (2) COLLECTION BY SECRETARY.—During the 11 period beginning on the date of the enactment of 12 this section and ending on September 30, 2020, the 13 following provisions may not apply with respect to a 14 Federal Perkins Loan: 15 (A) A wage garnishment authorized under 16 section 488A of the Higher Education Act of 17 1965 (20 U.S.C. 1095a) or section 3720D of 18 title 31, United States Code. 19 (B) A reduction of tax refund by amount 20 of debt authorized under section 3720A of title 21 31, United States Code, or section 6402(d) of 22 the Internal Revenue Code of 1986. 23 (C) A reduction of any other Federal ben- 24 efit payment by administrative offset authorized 25 VerDate Sep 11 2014 04:34 Jul 11, 2020 Jkt 099200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H7294.IH H7294 kjohnson on DSK79L0C42PROD with BILLS 5 •HR 7294 IH under section 3716 of title 31, United States 1 Code (including a benefit payment due to an in- 2 dividual under the Social Security Act or any 3 other provision described in subsection 4 (c)(3)(A)(i) of such section). 5 (D) Any other involuntary collection activ- 6 ity by the Secretary of Education. 7 (d) NOTICE TO BORROWERS AND TRANSITION PE- 8 RIOD.—To inform borrowers of the actions taken in ac- 9 cordance with this section and ensure an effective transi- 10 tion, the Secretary of Education shall require institutions 11 of higher education to— 12 (1) not later than 15 days after the date of the 13 enactment of this Act, notify borrowers— 14 (A) of the actions taken in accordance with 15 this section for whom payments have been sus- 16 pended and no interest shall accrue; 17 (B) of the actions taken in accordance with 18 subsection (c) for whom collections have been 19 suspended; 20 (C) of the option to continue making pay- 21 ments toward principal; and 22 (D) that the program under this section 23 shall only be provided during the COVID–19 24 pandemic; and 25 VerDate Sep 11 2014 04:34 Jul 11, 2020 Jkt 099200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H7294.IH H7294 kjohnson on DSK79L0C42PROD with BILLS 6 •HR 7294 IH (2) beginning on August 1, 2020, carry out a 1 program to provide not less than 6 notices by postal 2 mail, telephone, or electronic communication to bor- 3 rowers indicating when the borrower’s normal pay- 4 ment obligations will resume. 5 (e) WAIVERS.—In carrying out this section, the Sec- 6 retary of Education may waive the application of— 7 (1) subchapter I of chapter 35 of title 44, 8 United States Code (commonly known as the ‘‘Pa- 9 perwork Reduction Act’’); 10 (2) the master calendar requirements under 11 section 482 of the Higher Education Act of 1965 12 (20 U.S.C. 1089); 13 (3) negotiated rulemaking under section 492 of 14 the Higher Education Act of 1965 (20 U.S.C. 15 1098a); and 16 (4) the requirement to publish the notices re- 17 lated to the system of records of the agency before 18 implementation required under paragraphs (4) and 19 (11) of section 552a(e) of title 5, United States 20 Code (commonly known as the ‘‘Privacy Act of 21 1974’’), except that the notices shall be published 22 not later than 180 days after the date of enactment 23 of this Act. 24 VerDate Sep 11 2014 04:34 Jul 11, 2020 Jkt 099200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H7294.IH H7294 kjohnson on DSK79L0C42PROD with BILLS 7 •HR 7294 IH (f) EFFECTIVE DATE.—This section shall take effect 1 as if included in the enactment of the CARES Act (Public 2 Law 116–136). 3 Æ VerDate Sep 11 2014 04:34 Jul 11, 2020 Jkt 099200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6301 E:\BILLS\H7294.IH H7294 kjohnson on DSK79L0C42PROD with BILLS