federal advances to reserve funds of non-federal student loan insurance programs

federal advances to reserve funds of non-federal student loan insurance programs Sec. 114. (a) (1) Section 421(b) of the Higher Education Act of 1965 is amended by striking out “and” at the end of paragraph (2); by striking out the period at the end of the first sentence of that subsection and inserting in lieu thereof “, and”; and by adding thereafter the following new paragraph: “(4) there is authorized to be appropriated the sum of $12,500,000 for making advances after June 30, 1968, pursuant to section 422 for the reserve funds of State and nonprofit private student loan insurance programs.” (2) The second sentence of section 421 (b) of such Act is amended by striking out “under clauses (1) and (2)” and inserting in lieu thereof “under clauses (1), (2), and (4)”. (b) Section 422(a) of such Act is amended— (1) by striking out “clause (3)” in the first sentence of paragraph (1) and inserting in lieu thereof “clauses (3) and (4)”, and by striking out “of the fiscal years ending June 30, 1966, June 30, 1967, or June 30, 1968,” and inserting in lieu thereof “fiscal year” in the second sentence of such paragraph; and (2) by redesignating paragraph (2) as paragraph (3) and inserting after paragraph (1) the following new’ paragraph: “(2) No advance shall be made after June 30, 1968, unless matched by an equal amount from non-Federal sources. Such equal amount may include the unencumbered non-Federal portion of a reserve fund. As used in the preceding sentence, the term ‘unencumbered non-Federal portion’ means the amount (determined as of the time immediately pre-82 Stat. 1022ceding the making of the advance) of the reserve fund less the greater of (A) the sum of (i) advances made under this section prior to July 1, 1908, (ii) an amount equal to twice the amount of advances made under this section after June 30, 1968, and before the advance for purposes of which the determination is made, and (iii) the proceeds of earnings on advances made under this section, or (B) any amount which is required to be maintained in such fund pursuant to State law or regulation, or by agreement with lenders, as a reserve against the insurance of outstanding loans.” (c) Section 422(b) of such Act is amended by inserting “(1)” after “(b)”, by inserting “prior to July 1, 1968” before “pursuant to subsection (a)” where it appears in the first and third sentences, by deleting the last sentence of such subsection, and by adding at the end of such subsection the following new paragraphs: “(2) The total of the advances from the sums appropriated pursuant to clause (4) of section 421(b) (A) to nonprofit private institutions and organizations for the benefit of students in any State and (B) to such State may not exceed an amount which bears the same ratio to such sums as the population of such State aged eighteen to twenty-two, inclusive, bears to the population of all the States aged eighteen to twenty-two, inclusive, but such advances may otherwise be in such amounts as the Commissioner determines will best achieve the purposes for which they are made. The amount available, however, for advances to any State shall not be less than $25,009, and any additional funds needed to meet this requirement shall be derived by proportionately reducing (but not below $25,000) the amount available for advances to each of the remaining States. “(3) For the purposes of this subsection, the population aged eighteen to twenty-two, inclusive, of each State and of all the States shall be determined by the Commissioner on the basis of the most recent satisfactory data available to him,”