20 U.S.C. § 1087h — Funds for administrative expenses

Page 572 TITLE 20—EDUCATION § 1087g 1 See Funds for Account Maintenance Fees note below. 2 See References in Text note below. sition from the loan programs under part B of this sub- chapter to the direct student loan program under this part; and’’. 1993—Pub. L. 103–66 amended section generally, sub- stituting provisions relating to contracts for former provisions relating to terms and conditions. Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 1998 AMENDMENT Amendment by Pub. L. 105–244 effective Oct. 1, 1998, except as otherwise provided in Pub. L. 105–244, see sec- tion 3 of Pub. L. 105–244, set out as a note under section 1001 of this title. EFFECTIVE DATE Section effective Oct. 1, 1992, see section 2 of Pub. L. 102–325, set out as an Effective Date of 1992 Amendment note under section 1001 of this title. SELECTION OF STUDENT LOAN SERVICER Pub. L. 117–328, div. H, title III, Dec. 29, 2022, 136 Stat. 4893, provided in part: ‘‘That for student loan contracts awarded prior to October 1, 2017, the Secretary [of Edu- cation] shall allow student loan borrowers who are con- solidating Federal student loans to select from any stu- dent loan servicer to service their new consolidated student loan’’. Similar provisions were contained in the following prior appropriation acts: Pub. L. 117–103, div. H, title III, Mar. 15, 2022, 136 Stat. 480. Pub. L. 116–260, div. H, title III, Dec. 27, 2020, 134 Stat. 1603. Pub. L. 116–94, div. A, title III, Dec. 20, 2019, 133 Stat. 2592. Pub. L. 115–245, div. B, title III, Sept. 28, 2018, 132 Stat. 3102. Pub. L. 115–141, div. H, title III, Mar. 23, 2018, 132 Stat. 746. Pub. L. 115–31, div. H, title III, May 5, 2017, 131 Stat. 549. § 1087g. Repealed. Pub. L. 111–39, title IV, § 404(b)(3), July 1, 2009, 123 Stat. 1946 Section, Pub. L. 89–329, title IV, § 457, as added Pub. L. 102–325, title IV, § 451, July 23, 1992, 106 Stat. 572; amended Pub. L. 103–66, title IV, § 4021, Aug. 10, 1993, 107 Stat. 352, related to regulatory activities associated with implementation of the first year of the direct stu- dent loan program authorized by part D, including es- tablishment of closing date for applications not later than Oct. 1, 1993, and publication of list of selected in- stitutions not later than Jan. 1, 1994. Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF REPEAL Repeal effective as if enacted on the date of enact- ment of Pub. L. 110–315 (Aug. 14, 2008), see section 3 of Pub. L. 111–39, set out as an Effective Date of 2009 Amendment note under section 1001 of this title. § 1087h. Funds for administrative expenses (a) Administrative expenses (1) Mandatory funds for fiscal year 2006 For fiscal year 2006, there shall be available to the Secretary, from funds not otherwise ap- propriated, funds to be obligated for— (A) administrative costs under this part and part B, including the costs of the direct student loan programs under this part; and (B) account maintenance fees payable to guaranty agencies under part B and cal- culated in accordance with subsections (b) and (c), not to exceed (from such funds not otherwise appropriated) $820,000,000 in fiscal year 2006. (2) Repealed. Pub. L. 113–67, div. A, title V, § 502(2), Dec. 26, 2013, 127 Stat. 1187 (3) Authorization for administrative costs be- ginning in fiscal years 2007 through 2014 For each of the fiscal years 2007 through 2014, there are authorized to be appropriated such sums as may be necessary for administra- tive costs under this part and part B, includ- ing the costs of the direct student loan pro- grams under this part. (4) Continuing mandatory funds for account maintenance fees For each of the fiscal years 2007 through 2021,1 there shall be available to the Secretary, from funds not otherwise appropriated, funds to be obligated for account maintenance fees payable to guaranty agencies under part B and calculated in accordance with subsection (b). (5) Account maintenance fees Account maintenance fees under paragraph (3) 2 shall be paid quarterly and deposited in the Agency Operating Fund established under section 1072b of this title. (6) Technical assistance to institutions of high- er education (A) Provision of assistance The Secretary shall provide institutions of higher education participating, or seeking to participate, in the loan programs under this part with technical assistance in estab- lishing and administering such programs. (B) Funds There are authorized to be appropriated, and there are appropriated, to carry out this paragraph (in addition to any other amounts appropriated to carry out this paragraph and out of any money in the Treasury not other- wise appropriated), $50,000,000 for fiscal year 2010. (C) Definition In this paragraph, the term ‘‘assistance’’ means the provision of technical support, training, materials, technical assistance, and financial assistance. (7) Additional payments (A) Provision of assistance The Secretary shall provide payments to loan servicers for retaining jobs at locations in the United States where such servicers were operating under part B on January 1, 2010. (B) Funds There are authorized to be appropriated, and there are appropriated, to carry out this paragraph (in addition to any other amounts appropriated to carry out this paragraph and out of any money in the Treasury not other- wise appropriated), $25,000,000 for each of the fiscal years 2010 and 2011. Page 573 TITLE 20—EDUCATION § 1087h (8) Carryover The Secretary may carry over funds made available under this section to a subsequent fiscal year. (b) Calculation basis Account maintenance fees payable to guar- anty agencies under subsection (a)(4) shall be calculated on the basis of 0.06 percent of the original principal amount of outstanding loans on which insurance was issued under part B. (c) Budget justification No funds may be expended under this section unless the Secretary includes in the Department of Education’s annual budget justification to Congress a detailed description of the specific activities for which the funds made available by this section have been used in the prior and cur- rent years (if applicable), the activities and costs planned for the budget year, and the pro- jection of activities and costs for each remain- ing year for which administrative expenses under this section are made available. (Pub. L. 89–329, title IV, § 458, as added Pub. L. 102–325, title IV, § 451, July 23, 1992, 106 Stat. 573; amended Pub. L. 103–66, title IV, § 4021, Aug. 10, 1993, 107 Stat. 353; Pub. L. 104–19, title I, § 601, July 27, 1995, 109 Stat. 219; Pub. L. 105–33, title VI, § 6103, Aug. 5, 1997, 111 Stat. 652; Pub. L. 105–78, title VI, § 609(l), Nov. 13, 1997, 111 Stat. 1524; Pub. L. 105–244, title IV, § 454, Oct. 7, 1998, 112 Stat. 1717; Pub. L. 109–171, title VIII, § 8015, Feb. 8, 2006, 120 Stat. 172; Pub. L. 109–292, § 5, Sept. 30, 2006, 120 Stat. 1341; Pub. L. 110–84, title III, § 306, Sept. 27, 2007, 121 Stat. 800; Pub. L. 110–315, title IV, § 452, Aug. 14, 2008, 122 Stat. 3263; Pub. L. 111–152, title II, § 2212(b), Mar. 30, 2010, 124 Stat. 1080; Pub. L. 113–67, div. A, title V, § 502(2), Dec. 26, 2013, 127 Stat. 1187; Pub. L. 114–113, div. H, title III, § 310, Dec. 18, 2015, 129 Stat. 2638; Pub. L. 115–31, div. H, title III, § 309, May 5, 2017, 131 Stat. 552; Pub. L. 115–141, div. H, title III, § 309, Mar. 23, 2018, 132 Stat. 750; Pub. L. 115–245, div. B, title III, § 307, Sept. 28, 2018, 132 Stat. 3105; Pub. L. 116–94, div. A, title III, § 306, Dec. 20, 2019, 133 Stat. 2595; Pub. L. 116–260, div. H, title III, § 306, Dec. 27, 2020, 134 Stat. 1608.) Editorial Notes REFERENCES IN TEXT Paragraph (3), referred to in subsec. (a)(5), was redes- ignated par. (4) by Pub. L. 111–152, § 2212(b)(1)(B). AMENDMENTS 2020—Subsec. (a)(4). Pub. L. 116–260 substituted ‘‘2021’’ for ‘‘2020’’. 2019—Subsec. (a)(4). Pub. L. 116–94 substituted ‘‘2020’’ for ‘‘2019’’. 2018—Subsec. (a)(4). Pub. L. 115–245 substituted ‘‘2019’’ for ‘‘2018’’. Pub. L. 115–141 substituted ‘‘2018’’ for ‘‘2017’’. 2017—Subsec. (a)(4). Pub. L. 115–31 substituted ‘‘2017’’ for ‘‘2016’’. 2015—Subsec. (a)(4). Pub. L. 114–113 substituted ‘‘2016’’ for ‘‘2014’’. 2013—Subsec. (a)(2). Pub. L. 113–67 struck out par. (2). Text read as follows: ‘‘For fiscal years 2010 through 2019, there shall be available to the Secretary, in addi- tion to any other amounts appropriated to carry out this paragraph and out of any money in the Treasury not otherwise appropriated, funds to be obligated for administrative costs of servicing contracts with eligi- ble not-for-profit servicers as described in section 1087f of this title.’’ 2010—Subsec. (a)(2) to (8). Pub. L. 111–152, § 2212(b)(1), added pars. (2), (6), and (7) and redesignated former pars. (2), (3), (4), and (5) as (3), (4), (5), and (8), respec- tively. Subsec. (b). Pub. L. 111–152, § 2212(b)(2), substituted ‘‘subsection (a)(4)’’ for ‘‘subsection (a)(3)’’. 2008—Subsec. (a)(2). Pub. L. 110–315, § 452(1), sub- stituted ‘‘2014’’ for ‘‘2011’’ in heading and text. Subsec. (a)(3). Pub. L. 110–315, § 452(2), substituted ‘‘2014’’ for ‘‘2011’’. 2007—Subsec. (b). Pub. L. 110–84 substituted ‘‘0.06 per- cent’’ for ‘‘0.10 percent’’. 2006—Pub. L. 109–171 reenacted section catchline without change and amended text generally. Prior to amendment, text consisted of subsecs. (a) to (d) relat- ing to administrative expenses, calculation basis for account maintenance fees payable to guaranty agen- cies, special rules relating to caps on account mainte- nance fees and insufficient funding, and budget jus- tification for funds expended, respectively. Subsec. (b). Pub. L. 109–292 substituted ‘‘shall be cal- culated on’’ for ‘‘shall not exceed’’. 1998—Subsec. (a). Pub. L. 105–244, § 454(1), amended heading and text of subsec. (a) generally. Prior to amendment, subsec. (a) related to availability of funds for administrative costs and cost allowances. Subsec. (b). Pub. L. 105–244, § 454(2), amended heading and text of subsec. (b) generally. Prior to amendment, text read as follows: ‘‘Funds made available under sub- section (a) of this section shall remain available until expended.’’ Subsec. (c). Pub. L. 105–244, § 454(5), added subsec. (c). Former subsec. (c) redesignated (d). Subsec. (d). Pub. L. 105–244, § 454(4), redesignated sub- sec. (c) as (d). Pub. L. 105–244, § 454(3), struck out heading and text of subsec. (d). Text read as follows: ‘‘In the event the Sec- retary finds it necessary to use the authority provided to the Secretary under subsection (a) of this section to draw funds for administrative expenses from a future year’s funds, no funds may be expended under this sec- tion unless the Secretary immediately notifies the Committees on Appropriations of the Senate and of the House of Representatives, and the Labor and Human Resources Committee of the Senate and the Education and Labor Committee of the House of Representatives, of such action and explain the reasons for such action.’’ 1997—Subsec. (a). Pub. L. 105–33 amended heading and text of subsec. (a) generally. Prior to amendment, text read as follows: ‘‘Each fiscal year, there shall be avail- able to the Secretary of Education from funds available pursuant to section 1072(g) of this title and from funds not otherwise appropriated, funds to be obligated for administrative costs under this part, including the costs of the transition from the loan programs under part B of this subchapter to the direct student loan pro- grams under this part (including the costs of annually assessing the program under this part and the progress of the transition) and transition support (including ad- ministrative costs) for the expenses of guaranty agen- cies in servicing outstanding loans in their portfolios and in guaranteeing new loans, not to exceed (from such funds not otherwise appropriated) $260,000,000 in fiscal year 1994, $284,000,000 in fiscal year 1995, $550,000,000 in fiscal year 1996, $595,000,000 in fiscal year 1997, and $750,000,000 in fiscal year 1998. If in any fiscal year the Secretary determines that additional funds for administrative expenses are needed as a result of such transition or the expansion of the direct student loan programs under this part, the Secretary is authorized to use funds available under this section for a subse- quent fiscal year for such expenses, except that the total expenditures by the Secretary (from such funds not otherwise appropriated) shall not exceed $2,439,000,000 in fiscal years 1994 through 1998. The Sec- retary is also authorized to carry over funds available under this section to a subsequent fiscal year.’’ Page 574 TITLE 20—EDUCATION § 1087i Subsec. (a)(1). Pub. L. 105–78 substituted ‘‘$507,000,000’’ for ‘‘$532,000,000’’ in closing provisions. 1995—Subsec. (a). Pub. L. 104–19 substituted ‘‘$284,000,000 in fiscal year 1995’’ for ‘‘$345,000,000 in fis- cal year 1995’’ and ‘‘$2,439,000,000 in fiscal years 1994 through 1998’’ for ‘‘$2,500,000,000 in fiscal years 1994 through 1998’’. 1993—Pub. L. 103–66 amended section generally, sub- stituting provisions relating to funds for administra- tive expenses for former provisions relating to reports. Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 2007 AMENDMENT Amendment by Pub. L. 110–84 effective Oct. 1, 2007, see section 1(c) of Pub. L. 110–84, set out as a note under section 1070a of this title. EFFECTIVE DATE OF 2006 AMENDMENT Amendment by Pub. L. 109–171 effective July 1, 2006, except as otherwise provided, see section 8001(c) of Pub. L. 109–171, set out as a note under section 1002 of this title. EFFECTIVE DATE OF 1998 AMENDMENT Amendment by Pub. L. 105–244 effective Oct. 1, 1998, except as otherwise provided in Pub. L. 105–244, see sec- tion 3 of Pub. L. 105–244, set out as a note under section 1001 of this title. EFFECTIVE DATE Section effective Oct. 1, 1992, see section 2 of Pub. L. 102–325, set out as an Effective Date of 1992 Amendment note under section 1001 of this title. CONSTRUCTION Pub. L. 105–78, title VI, § 609(m), Nov. 13, 1997, 111 Stat. 1524, provided that: ‘‘Nothing in this Act [see Tables for classification] or an amendment made by this Act shall be construed to prohibit the Secretary of Education from using funds that are returned or otherwise recov- ered by the Secretary under section 422(g) of the Higher Education Act of 1965 (20 U.S.C. 1072(g)) including the balances of returned reserve funds, formerly held by the Higher Education Assistance Foundation, that are currently held in Higher Education Assistance Founda- tion Claims Reserves, Treasury account number 91X6192, for expenditure for expenses pursuant to sec- tion 458 of such Act (20 U.S.C. 1087h).’’ FUNDS FOR ACCOUNT MAINTENANCE FEES Pub. L. 118–47, div. D, title III, § 306, Mar. 23, 2024, 138 Stat. 692, provided that: ‘‘Section 458(a)(4) of the HEA [Higher Education Act of 1965] (20 U.S.C. 1087h(a)[(4)]) shall be applied by substituting ‘2024’ for ‘2021’.’’ Similar provisions were contained in the following prior appropriation acts: Pub. L. 117–328, div. H, title III, § 306, Dec. 29, 2022, 136 Stat. 4897. Pub. L. 117–103, div. H, title III, § 306, Mar. 15, 2022, 136 Stat. 484. USE OF FUNDS FOR ADMINISTRATIVE EXPENSES OF WILLIAM D. FORD DIRECT LOAN PROGRAM PROHIBITED Pub. L. 104–208, div. A, title I, § 101(e) [title III, § 304], Sept. 30, 1996, 110 Stat. 3009–233, 3009–261, provided in part that: ‘‘Notwithstanding section 458 of the Higher Education Act [of 1965] [20 U.S.C. 1087h], the Secretary may not use funds available under that section or any other section for subsequent fiscal years for adminis- trative expenses of the William D. Ford Direct Loan Program.’’ Similar provisions were contained in the following prior appropriation act: Pub. L. 104–134, title I, § 101(d) [title III, § 305], Apr. 26, 1996, 110 Stat. 1321–211, 1321–236; renumbered title I, Pub. L. 104–140, § 1(a), May 2, 1996, 110 Stat. 1327. § 1087i. Authority to sell loans The Secretary, in consultation with the Sec- retary of the Treasury, is authorized to sell loans made under this part on such terms as the Secretary determines are in the best interest of the United States, except that any such sale shall not result in any cost to the Federal Gov- ernment. Notwithstanding any other provision of law, the proceeds of any such sale may be used by the Secretary to offer reductions in the interest rate paid by a borrower of a loan made under this part as the Secretary determines ap- propriate to encourage on-time repayment in ac- cordance with section 1087e(b)(7) of this title. Such reductions may be offered only if the Sec- retary determines the reductions are in the best financial interests of the Federal Government. (Pub. L. 89–329, title IV, § 459, as added Pub. L. 105–244, title IV, § 455, Oct. 7, 1998, 112 Stat. 1718.) Editorial Notes PRIOR PROVISIONS A prior section 1087i, Pub. L. 89–329, title IV, § 459, as added Pub. L. 102–325, title IV, § 451, July 23, 1992, 106 Stat. 575, which related to schedule of regulatory ac- tivities by Secretary under Federal direct loan dem- onstration program, was omitted in the general amend- ment of this part by Pub. L. 103–66. Statutory Notes and Related Subsidiaries EFFECTIVE DATE Section effective Oct. 1, 1998, except as otherwise pro- vided in Pub. L. 105–244, see section 3 of Pub. L. 105–244, set out as an Effective Date of 1998 Amendment note under section 1001 of this title. § 1087i–1. Temporary authority to purchase stu- dent loans (a) Authority to purchase (1) Authority; determination required Upon a determination by the Secretary that there is an inadequate availability of loan cap- ital to meet the demand for loans under sec- tions 1078, 1078–2, or 1078–8 of this title, wheth- er as a result of inadequate liquidity for such loans or for other reasons, the Secretary, in consultation with the Secretary of the Treas- ury, is authorized to purchase, or enter into forward commitments to purchase, from any eligible lender, as defined by section 1085(d)(1) of this title, loans first disbursed under sec- tions 1078, 1078–2, or 1078–8 of this title on or after October 1, 2003, and before July 1, 2010, on such terms as the Secretary, the Secretary of the Treasury, and the Director of the Office of Management and Budget jointly determine are in the best interest of the United States, ex- cept that any purchase under this section shall not result in any net cost to the Federal Government (including the cost of servicing the loans purchased), as determined jointly by the Secretary, the Secretary of the Treasury, and the Director of the Office of Management and Budget. (2) Federal Register notice The Secretary, the Secretary of the Treas- ury, and the Director of the Office of Manage-