Hearings

233

to be appropriated under the preceding sentence for

each fiscal year, there is hereby authorized to be appropriated for that fiscal year, for making such loans, the difference (if any) between any specific sums authorized

to be appropriated under the preceding sentence for the preceding fiscal year and the sums which were appropriated for such preceding year under such sentence. Sums appropriated pursuant to this subsection

for

any fiscal year shall be available without fiscal-year limitation for loans under this title."

CLARIFYING AMENDMENT OF DEFINITION OF

DEVELOPMENT COST

13 SEC. 105. Subsection (c) of section 401 of the Higher 14 Education Facilities Act of 1963 is amended (1) by insert15 ing “(1)” immediately after "(c)", (2) by redesignating 16 clauses (1) and (2) as clauses (A) and (B), respectively, 17 (3) by redesignating subclauses (A) and (B) as sub18 clauses (i) and (ii), and (4) by adding at the end thereof 19 the following new paragraph:

"(2) In determining the development cost with respect

21 to an academic facility, the Commissioner may include ex22 penditures for works of art for the facility of not to exceed 23 1 per centum of the total cost (including such expenditures) 24 to the applicant of construction of, and land acquisition and 25 site improvements for, such facility."

ACTIVITIES

SEC. 106. The Higher Education Facilities Act of 1963 5 is amended by striking out subsection (b) of section 304 6 and by redesignating subsection (c) and references thereto 7 as subsection (b).

PART B-EXTENSION OF ASSISTANCE TO DEVELOPING

INSTITUTIONS

SEC. 111. Paragraph (1) of section 301 (b) of the 11 Higher Education Act of 1965 is amended by inserting "the 12 sum of $30,000,000 for the fiscal year ending June 30, 13 1967, and such sums as may be necessary for each of the 14 three succeeding fiscal years" after "1966,".

TITLE II-STUDENT LOAN PROGRAMS

LOAN REIMBURSEMENT PAYMENTS FOR TEACHERS

SEC. 201. Title II of the National Defense Education

18 Act of 1958 is amended by redesignating subsection (c) of 19 section 205 as subsection (d), and by inserting after sub

20 section (b) the following new subsection:

"(c) In order to encourage students who have obtained

a loan under this title to refinance such loan through the

23 student loan program carried out under part B of title IV of

24 the Higher Education Act of 1965, and likewise to encourage

1 students to obtain new loans under such part B program in 2 lieu of obtaining such loans under this title, a student who 3 does so with the approval of the educational institution in4 volved shall, with respect to so much of the loan under such 5 part B as

"(1) is a refinancing of a student loan made by the institution under this title, or,

"(2) in the case of a loan under such part B obtained in lieu of a loan from the institution, does not

exceed the amount which he was eligible to borrow from the institution,

12 be entitled, in accordance with regulations of the Commis13 sioner, to have the following loan reimbursement payments 14 made to him by the Commissioner: An amount equal to 10 per centum of the applicable total principal amount of any such loan shall be paid for each complete academic year or its equivalent (as determined under regulations of the

Commissioner) of service as a full-time teacher in a public

or other nonprofit elementary or secondary school in a State, 20 in an institution of higher education, or in an elementary or 21 secondary school overseas of the Armed Forces of the United 22 States, until an amount equal to 50 per centum of such 23 total has been paid. The annual amount shall be 15 per

2 2 * R

centum (rather than 10 per centum) for each complete

academic year or its equivalent (as so determined) of serv

1 ice as a full-time teacher in a public or other nonprofit 2 elementary or secondary school which is in the school dis3 trict of a local educational agency which is eligible in that 4 year for assistance pursuant to title II of the Act of Sep5 tember 30, 1950, Public Law 874, Eighty-first Congress, 6 as amended, and which for purposes of this paragraph and 7 for that year has been determined by the Commissioner, 8 pursuant to regulations and after consultation with the ap9 propriate State educational agency, to be a school in which 10 there is a high concentration of students from low-income 11 families, except that the Commissioner shall not make such 12 determination with respect to more than 25 per centum of 13 the total of the public and other nonprofit elementary and 14 secondary schools in any one State for any one year; and 15 for the purpose of payments pursuant to this sentence, an 16 aggregate amount equal to an additional 50 per centum of 17 the applicable total principal amount of any such loan may 18 be so paid. No payment shall be made under this subsec19 tion for service performed more than fifteen years from the 20 execution of the note or written agreement evidencing it." 21 ENCOURAGING PRIVATE CAPITAL FOR NATIONAL DEFENSE

228

STUDENT LOANS

SEC. 202. Section 203 of the National Defense Educa

24 tion Act of 1958 is amended by designating the present text

as subsection (a) and by inserting at the end thereof the 2 following new subsection:

3 "(b) (1) For the purpose of substituting for direct 4 Federal support to the maximum extent practicable private 5 and other non-Federal funds for student loans, the Commis6 sioner is authorized to provide the following forms of assist7 ance, upon such terms and conditions as he may deem 8 appropriate, for the benefit of students attending institutions 9 of higher education:

"(A) If an institution of higher education borrows non-Federal funds (or otherwise receives or makes available repayable non-Federal funds) for use as capital contributions to a student loan fund established under this title, the Commissioner may (i) guarantee timely repayment of all or part of such funds (plus interest thereon), (ii) agree to reimburse the institution for up to 90 per centum of the loss to it from defaults on student loans made from such funds, (iii) agree to pay

to the institution the amount of the interest differential (as defined in paragraph (3) of this subsection) with respect to such funds, and (iv) agree to pay the institution the amount of administrative expenses authorized by clause (3) of section 204 to be paid out of a student

loan fund with respect to such funds.

"(B) If an institution of higher education arranges

66-396 O-66-2

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