emergency assistance for institutions of higher education

emergency assistance for institutions of higher education Sec. 122. (a) (1) The Congress hereby finds and declares that— (A) the Nation’s institutions of higher education constitute a national resource which significantly contributes to the security, general welfare, and economy of the United States; (B) considerable evidence has been advanced which indicates that many institutions of higher education are in financial distress resulting from many causes, including, among others, efforts on the part of such institutions to increase enrollments, to improve the quality of education and training, and to enlarge educational opportunities; and (C) various proposals have been presented to the Congress, in response to such condition of financial distress, for providing financial assistance to the Nation’s institutions of higher education but, except for that necessary to justify payments provided for reimbursement for part of the cost of instruction as provided in title X of this Act, insufficient information is available on the basis of which the Congress can determine, with any degree of certainty, the nature and causes of such financial distress or the most appropriate means with which present and future conditions of financial distress may be dealt. (2) It is the purpose of this section to provide to institutions of higher education, which are determined in accordance with this section to be in serious financial distress, interim emergency assistance to enable them to determine the nature and causes of such distress and the means by which such distress may be alleviated, and to improve their capabilities for dealing with financial problems using, to the extent appropriate, assistance authorized under the Higher Education Act of 1965 and all other sources of financial assistance. (b) (1) There is authorized to be appropriated for the period beginning with the date of enactment of this Act, and ending June 30, 1974, $40,000,000 for the purpose of making grants under this section. Sums so appropriated shall remain available for obligation and expenditure until expended. (2) (A) The Commissioner is authorized to make grants to institutions of higher education which are in serious financial distress, as such term is defined in regulations of the Commissioner, in accordance with the provisions of this section. (B) A grant under this subsection may be made only upon application therefor to the Commissioner. Such applications shall be submitted at such time, in such form, and containing such information, assurances, policies, and procedures as the Commissioner may require in order to enable him to carry out his functions under this section. The Commissioner shall not approve any such application unless he finds that— (i) in the case of a public institution of higher education, the institution has submitted its application for emergency assistance under this subsection to the appropriate State agency, as provided by the law of the State in which it. is located and in accordance with regulations of the Commissioner, if any such agency exists86 Stat. 246 with respect to such State, and such State agency has made a finding, in accordance with criteria established by the Commissioner, that such institution is iii serious financial distress and (I) is in need of financial assistance under this section to continue its operation, or (II) will have to discontinue or substantially curtail its academic programs to the detriment of the quality of education available to its students; (ii) in the case of a nonpublic institution of higher education, the institution either has complied with the procedure set forth in clause (i) for public institutions, or has submitted an application directly to the Commissioner and the Commissioner has determined that the institution meets the condition set forth in either clause (i)(I) or (i)(II), and has submitted a copy to the appropriate State agency, as determined under the law of the State in which it is located and in accordance with regulations of the Commissioner, for comment; (iii) such institution has developed, adopted, and submitted a plan which the Commissioner determines provides reasonable assurance that, if the institution receives the grant for which it is applying, such institution will be able, during and after the period covered by such grant, to continue the educational services, programs, and activities with respect to which such grant is sought; (iv) such institution is making a major contribution to the overall higher educational system of the area of the State in which it is located, or of the Nation; and (v) such institution has included in such application such policies and procedures for the use of fluids received under the grant as will insure that such funds will not be used for a school or department of divinity or for any religious worship or sectarian activity, and as will insure that such funds will be solely used for the purposes for which the grant is made. (C) An application shall be approved under this subsection only if it includes such information, terms, and conditions as the Commissioner finds necessary and reasonable to enable him to carry out his functions under this section, and as he determines will be in the financial interest of the United States, and the applicant agrees— (i) to disclose such financial information as the Commissioner determines to be necessary to determine the sources or causes of its financial distress and other information relating to its use of its financial resources; (ii) to conduct a comprehensive cost analysis study of its operation, including income-cost comparisons and cost per credit hour of instruction for each department, in accordance with uniform standards prescribed by the Commissioner; and (iii) to consider, and either implement or give adequate reasons in writing for not doing so, any financial or operational reform recommended by the Commissioner for the improvement of its financial condition, (D) The Commissioner shall not approve an application for a grant under this section without first obtaining the advice and recommendations of a panel of specialists who are not regular, full-time employees of the Federal Government and who are competent to evaluate the applications as to the relative degree of financial distress of the applying institutions. (c) As used in this section— (1) the term “institution of higher education” means an educational institution in any State which (A) admits as regular students only persons having a certificate of graduation from a school providing secondary education, or the recognized equivalent of such a certificate, (B) is legally authorized within such86 Stat. 247 State to provide a program of education beyond secondary education, (C) has been in existence for at least five years prior to the date upon which it makes application under this section, (D) provides an educational program for which it awards a bachelor’s degree or provides not less than a two-year program which is acceptable for full credit towards such a degree, (E) is a public or other nonprofit institution, and (F) is accredited by a nationally recognized accrediting agency or association or, if not so accredited, (i) is an institution with respect to which the Commissioner has determined that there is satisfactory assurance, considering the resources available to the institution, the period of time, if any. during which it has operated, the effort it is making to meet accreditation standards, and the purpose for which this determination is being made, that the institution will meet the accreditation standards of such an agency or association within a reasonable time, or (ii) is an institution whose credits are accepted, on transfer, by not less than three institutions which are so accredited, for credit on the same basis as if transferred from an institution which is accredited, and, for the purpose of this clause, the Commissioner shall publish a list of nationally recognized accrediting agencies or associations which lie determines to be reliable authority as to the quality of training offered; (2) the term “State” includes the fifty States, the District of Columbia, the Commonwealth of Puerto Rico, Guam, and the Virgin Islands; and (3) the term “school or department of divinity” means an institution or a department or a branch of an institution the program of instruction of which is designed for the education of students (A) to prepare them to become ministers of religion or to enter upon some other religious vocation (or to provide continuing training for any such vocation), or (B) to prepare them to teach theological subjects.