Bill > HR713

This bill, called the "Preventing Financial Exploitation in Higher Education Act", aims to impose financial penalties on wealthy higher education institutions with high student loan default, delinquency, and underpayment rates. Specifically, the bill targets institutions with endowment funds of $2.5 billion or more and introduces a graduated penalty system from fiscal years 2025-2030, where institutions will be required to pay penalties ranging from 16-30% of the total outstanding loan balance if their student loan default, delinquency, or underpayment rates exceed certain thresholds. The penalties decrease each fiscal year, ultimately settling at 20%, 18%, and 16% for default, delinquency, and underpayment rates respectively by fiscal year 2030. Additionally, the bill introduces a tax increase on large educational institutions that raise tuition, increasing their net investment income tax from 1.4% to 25% if they exceed inflation-adjusted tuition base amounts. The penalties are designed to incentivize institutions to improve student loan outcomes and control tuition costs, while explicitly stating that these penalties do not affect individual student borrowers' loan obligations.

Education

https://www.congress.gov/bill/119th-congress/house-bill/713/all-info