90 STAT. 2140 Audit. Report to Report to President and PUBLIC LAW 94-482-OCT. 12, 1976 "(3) to adopt, amend, and repeal by its Board of Directors, bylaws, rules, and regulations as may be necessary for the conduct of its business; "(4) to conduct its business, carry on its operations, and have officers and exercise the power granted by this section in any State without regard to any qualification or similar statute in any State; (5) to lease, purchase, or otherwise acquire, own, hold, improve, use, or otherwise deal in and with any property, real, personal, or mixed, or any interest therein, wherever situated; "(6) to accept gifts or donations of services, or of property, real, personal, or mixed, tangible or intangible, in aid of any of the purposes of the Association; "(7) to sell, convey, mortgage, pledge, lease, exchange, and otherwise dispose of its property and assets; "(8) to appoint such officers, attorneys, employees, and agents as may be required, to determine their qualifications, to define their duties, to fix their salaries, require bonds for them and fix the penalty thereof; and (9) to enter into contracts, to execute instruments, to incur liabilities, and to do all things as are necessary or incidental to the proper management of its affairs and the proper conduct of its business. "(j) The accounts of the Association shall be audited annually. Such audits shall be conducted in accordance with generally accepted auditing standards by independent certified public accountants or by independent licensed public accountants, licensed on or before December 31, 1970, who are certified or licensed by a regulatory authority of a State or other political subdivision of the United States, except that independent public accountants licensed to practice by such regulatory authority after December 31, 1970, and persons who, although not so certified or licensed, meet, in the opinion of the Secretary, standards of education and experience representative of the highest standards prescribed by the licensing authorities of the several States which provide for the continuing licensing of public accountants and which are prescribed by the Secretary in appropriate regulations may perform such audits until December 31, 1975. A report of each such audit shall be furnished to the Secretary of the Treasury. The audit shall be conducted at the place or places where the accounts are normally kept. The representatives of the Secretary shall have access to all books, accounts, financial records, reports, files, and all other papers, things, or property belonging to or in use by the Association and necessary to facilitate the audit, and they shall be afforded full facilities for verifying transactions with the balances or securities held by depositaries, fiscal agents, and custodians. "(k) A report of each such audit for a fiscal year shall be made by the Secretary of the Treasury to the President and to the Congress not later than six months following the close of such fiscal year. The report shall set forth the scope of the audit and shall include a statement (showing intercorporate relations) of assets and liabilities, capital and surplus or deficit; a statement of surplus or deficit analysis; a statement of income and expense; a statement of sources and application of funds; and such comments and information as may be deemed necessary to keep the President and the Congress informed of the operations and financial condition of the Association, together with such recommendations with respect thereto as the Secretary may deem advisable, including a report of any impairment of capital or lack of PUBLIC LAW 94-482-OCT. 12, 1976 sufficient capital noted in the audit. A copy of each report shall be furnished to the Secretary of Health, Education, and Welfare and to the Association. 90 STAT. 2141 "(1) All obligations issued by the Association shall be lawful investments, and may be accepted as security for all fiduciary, trust, and public funds, the investment or deposit of which shall be under authority or control of the United States or of any officer or officers thereof. All stock and obligations issued by the Association pursuant to this section shall be deemed to be exempt securities within the meaning of laws administered by the Securities and Exchange Commission, to the same extent as securities which are direct obligations of, or obligations guaranteed as to principal or interest by, the United States. 12 USC 355. The Association shall, for the purposes of section 14 (b) (2) of the Federal Reserve Act, be deemed to be an agency of the United States. "(m) In order to furnish obligations for delivery by the Association, the Secretary of the Treasury is authorized to prepare such obligations in such form as the Board of Directors may approve, such obligations when prepared to be held in the Treasury subject to delivery upon order by the Association. The engraved plates, dies, bed pieces, and so forth, executed in connection therewith shall remain in the custody of the Secretary of the Treasury. The Association shall reimburse the Secretary of the Treasury for any expenditures made in the preparation, custody, and delivery of such obligations. "(n) The Association shall, as soon as practicable after the end of each fiscal year, transmit to the President and the Congress a report of its operations and activities during each year. "FIVE-YEAR NONDISCHARGEABILITY OF CERTAIN LOAN DEBTS Report to "SEC. 439A. (a) A debt which is a loan insured or guaranteed under 20 USC 1087-3. the authority of this part may be released by a discharge in bankruptcy under the Bankruptcy Act only if such discharge is granted after the five-year period (exclusive of any applicable suspension of the repayment period) beginning on the date of commencement of the repayment period of such loan, except that prior to the expiration of that five-year period, such loan may be released only if the court in which the proceeding is pending determines that payment from future income or other wealth will impose an undue hardship on the debtor or his dependents. "(b) Subsection (a) of this section shall be effective with respect to Effective date. any proceedings begun under the Bankruptcy Act on or after Septem- 11 USC 1 note. ber 30, 1977. "CRIMINAL PENALTIES "SEC. 440. (a) Any person who knowingly and willfully embez- 20 USC 1087-4. zles, misapplies, steals, or obtains by fraud, false statement, or forgery any funds, assets or property provided or insured under this part shall be fined not more than $10,000 or imprisoned for not more than five years, or both; but if the amount so embezzled, misapplied, stolen or obtained by fraud, false statement, or forgery does not exceed $200, the fine shall be not more than $1,000 and imprisonment shall not exceed one year, or both. "(b) Any person who knowingly and willfully makes any false statement, furnishes any false information, or conceals any material information in connection with an application for a finding by the Commissioner under section 435 (b) (4) (A) or (B), for the purpose of 90 STAT. 2142 Penalty. Effective date. 20 USC 1087 note. 20 USC 1078a. Repeal. 83 Stat. 141. 20 USC 1078a note. PUBLIC LAW 94-482-OCT. 12, 1976 qualifying an educational institution as an eligible institution under this part shall, upon conviction thereof, be fined not more than $1,000 or imprisoned not more than one year, or both. "(c) Any person who knowingly and willfully makes any false statement to, furnishes any false information to, or conceals any material information in connection with the assignment of a loan, which is insured under this part, to another eligible lender, shall, upon conviction thereof, be fined not more than $1,000 or imprisoned not more than one year, or both. "(d) Any person who knowingly and willfully makes an unlawful payment to an eligible lender as an inducement to make, or to acquire by assignment, a loan insured under this part shall, upon conviction thereof, be fined not more than $1,000 or imprisoned not more than one year, or both. "(e) Any person who knowingly and willfully destroys any appli- . cation for a loan which is insured under this part, any application for insurance of a loan under this part, or destroys or conceals any other record relating to the making or insuring of loans under this part with intent to defraud the United States or to prevent the United States from enforcing any right obtained by subrogation under this part, shall upon conviction thereof, be fined not more than $10,000 or imprisoned not more than five years, or both.". (b) The amendment made by subsection (a) of this section of this Act shall become effective October 1, 1976, except as otherwise provided therein, and to the extent such amendment makes changes in such part B which affect student loans, such changes shall apply to outstanding loans as well as to loans made after the amendment becomes effective, except that (1) the changes made in sections 425 (a), 427 (a) (1) (C), 427 (a) (2) (G) and 428 (b) (1) (A), (B), and (P) shall become applicable with respect to loans to cover the costs of education for periods of enrollments beginning on or after October 1, 1976; (2) section 422 (c) shall become effective October 1, 1977; (3) section 428 (f) shall become effective October 1, 1976; (4) the changes made in section 428 (a) (2) shall become applicable with respect to the determination of interest subsidies on loans to cover the costs of education for periods of enrollment beginning on or after 30 days after the date of enactment of this Act; (5) the new section 433 shall become effective with respect to loans made to cover the costs of education for periods of enrollment beginning on or after October 1, 1976; (6) the changes in section 428 (c) with respect to the amount of Federal guarantee payments shall become effective with respect to payments to reimburse States and nonprofit private institutions and organizations with which the Commissioner has an agreement under section 428 (c) of such part which are made on or after October 1, 1976; and (7) section 438, shall become effective with respect to fiscal quarters beginning after December 31, 1976. . (c) (1). Section 2(a) (7) of the Emergency Insured Student Loan Act of 1969 is amended by striking out "October 1, 1976” and inserting in lieu thereof "January 1, 1977." (2) Effective October 1, 1977, the Emergency Insured Student Loan Act of 1969 is repealed. PUBLIC LAW 94-482-OCT. 12, 1976 WORK-STUDY PROGRAM SEC. 128. (a) Section 441 (b) of the Act is amended- (2) by inserting before the period a comma and the following: "$420,000,000 for the fiscal year ending June 30, 1976, and the transitional period beginning July 1, 1976, and ending September 30, 1976, $450,000,000 for the fiscal year ending September 30, 1977, $570,000,000 for the fiscal year ending September 30, 1978, $600,000,000 for the fiscal year ending September 30, 1979, $630,000,000 for the fiscal year ending September 30, 1980, $670,000,000 for the fiscal year ending September 30, 1981, and $720,000,000 for the fiscal year ending September 30, 1982. 90 STAT. 2143 42 USC 2751. (b) Section 443 (b) of the Act is amended by striking "461" and 42 USC 2753. inserting in lieu thereof "491", and by inserting before the period at the end thereof the following: ", and includes a combination of such institutions which have entered into a cooperative arrangement, or have designated or created a public or private nonprofit agency, institution, or organization to act on their behalf.". (c) (1) Section 444 (a) (1) of the Act is amended by striking out the 42 USC 2754. word "public" the second time it appears and by inserting in lieu thereof "Federal, State, or local public agency", and by inserting "agency or" before the word "organization" the second time it appears in such section. (2) Section 444 (a) (2) of the Act is amended to read as follows: "(2) provide that funds granted an institution of higher education, pursuant to section 443, may be used only to make payments to students participating in work-study programs, except that an institution may use a portion of the sums granted to it to meet administrative expenses in accordance with section 493 of this Act, may use a portion of the sums granted to it to meet the cost of a job location and development program in accordance with section 447 of this part, and may transfer funds Infra. in accordance with the provisions of section 496 of this Act;". (3) Section 444 (a) (4) of the Act is amended to read as follows: "(4) provide that no student in a work-study program under this part shall be required to terminate that employment during a semester (or other regular enrollment period) at the time income derived from any additional employment together with such work-study income is in excess of the determination of the amount of such student's need for that semester under clause (3) of this subsection, but when such excess income equals $200 or more, continued employment under a work-study program shall not be subsidized with funds appropriated under this part:". (4) Section 444 (a) (7) of the Act is amended to read as follows: "(7) include provisions to make employment under such workstudy program reasonably available (to the extent of available funds) to all eligible students in the institution in need thereof, and to make equivalent employment offered or arranged by the institution reasonably available (to the extent of available funds) to all students in the institution who desire such employment; and". (d) Section 447 of the Act is amended to read as follows: "JOB LOCATION AND DEVELOPMENT PROGRAMS 42 USC 2756a. "SEC. 447. (a) The Commissioner is authorized to enter into agree- Agreements. ments with eligible institutions under which such institution may use 90 STAT. 2144 20 USC 1087a-1087c. 20 USC 1133. PUBLIC LAW 94-482-OCT. 12, 1976 not more than 10 per centum or $15,000 of its allotment under section 446, whichever is less, to establish or expand a program under which such institution, separately, in combination with other eligible institutions, or through a contract with a nonprofit organization, locates and develops jobs for currently enrolled students which are suitable to the scheduling and other needs of such students. "(b) Agreements under subsection (a) shall "(1) provide that the Federal share of the cost of any program under this section will not exceed 80 per centum of such cost; "(2) provide satisfactory assurance that funds available under this section will not be used to locate or develop jobs at an eligible institution; "(3) provide satisfactory assurance that the institution will continue to spend in its own job location and development programs, from sources other than funds received under this section, not less than the average expenditures per year made during the most recent three fiscal years preceding the effective date of the agreement; "(4) provide satisfactory assurance that funds available under this section will not be used for the location or development of jobs for students to obtain upon graduation, but rather for the location and development of jobs available to students during and between periods of attendance at such institution; "(5) provide satisfactory assurance that the location or development of jobs pursuant to programs assisted under this section will not result in the displacement of employed workers or impair existing contracts for services; "(6) provide satisfactory assurance that Federal funds used for the purposes of this section can realistically be expected to help generate student wages exceeding in the aggregate the amount of such funds and that if such funds are used to contract with another organization, appropriate performance standards are part of such contract; and "(7) provide that the institution will submit to the Commissioner an annual report on the uses made of funds provided under this section and an evaluation of the effectiveness of such program in benefiting the students of such institution.". COOPERATIVE EDUCATION SEC. 129. (a) Title IV of the Act is further amended by striking out part D and any references thereto. (b) Title VIII of the Act is amended to read as follows: "TITLE VIII-COOPERATIVE EDUCATION "APPROPRIATIONS AUTHORIZED "SEC. 801. (a) There are authorized to be appropriated— "(1) for the fiscal year ending June 30, 1976, and the period beginning July 1, 1976, and ending September 30, 1976, $13,000,000; "(2) for the fiscal year 1977, $15,000,000; แ "(3) for the fiscal year 1978, $20,000,000; "(4) for the fiscal year 1979, $25,000,000; and "(5) for each of the fiscal years 1980, 1981, and 1982, $25,000,000, |