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S. 3294 - Fund for Innovation and Success in Higher Education Act

Introduced: 2018-07-26
Bill Status: Read twice and referred to the Committee on Health, Education, Labor, and Pensions.
 
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115th CONGRESS
2d Session
S. 3294


    To amend the Higher Education Act of 1965 to support innovative, evidence-based approaches that improve the effectiveness and efficiency of postsecondary education for all students, to allow pay for success initiatives, to provide additional evaluation authority, and for other purposes.


IN THE SENATE OF THE UNITED STATES

July 26, 2018

    Mr. Hatch (for himself, Mr. Bennet, and Mr. Young) introduced the following bill; which was read twice and referred to the Committee on Health, Education, Labor, and Pensions


A BILL

    To amend the Higher Education Act of 1965 to support innovative, evidence-based approaches that improve the effectiveness and efficiency of postsecondary education for all students, to allow pay for success initiatives, to provide additional evaluation authority, and for other purposes.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. Short title.

This Act may be cited as the “Fund for Innovation and Success in Higher Education Act” or the “FINISH Act”.

SEC. 2. Innovation grants.

Part B of title VII of the Higher Education Act of 1965 (20 U.S.C. 1138 et seq.) is amended—

(1) by redesignating section 745 as section 746; and

(2) by inserting after section 744 the following:

“SEC. 745. Innovation grants.

“(a) Purposes.—The purposes of this section are to—

“(1) increase access to postsecondary education opportunities for high-need students;

“(2) identify and support the most effective interventions to increase postsecondary degree attainment of high-need students; and

“(3) improve the efficiency of postsecondary education.

“(b) Definitions.—In this section:

“(1) ELIGIBLE ENTITY.—The term ‘eligible entity’ means any of the following:

“(A) A State educational agency.

“(B) A public or private nonprofit institution of higher education.

“(C) The Bureau of Indian Education.

“(D) A consortium of any of the entities described in subparagraphs (A) through (C).

“(E) A partnership between a State educational agency or public or private nonprofit institution of higher education and one or more of the following:

“(i) A nonprofit organization.

“(ii) An intermediary organization.

“(iii) A business.

“(iv) A sponsor of a program receiving assistance under the National and Community Service Act of 1990 (42 U.S.C. 12501 et seq.).

“(v) A local educational agency.

“(2) HIGH-NEED STUDENT.—The term ‘high-need student’—

“(A) means a student, or prospective student, at an institution of higher education who is at risk of educational failure or otherwise in need of special assistance and support; and

“(B) may include an adult learner, working student, part-time student, student from a low-income background, student of color, former foster youth, first-generation student, student with a disability, student who is deaf or blind or visually impaired, or student who is an English learner.

“(3) INTERMEDIARY ORGANIZATION.—The term ‘intermediary organization’ means an entity—

“(A) with strong skills and a track record of success in—

“(i) identifying effective interventions to address State, regional, or local problems;

“(ii) managing high-quality subgrant processes; and

“(iii) providing technical assistance and support to subgrantees to ensure quality and improve outcomes; and

“(B) that utilizes an evidence-based decisionmaking strategy when selecting high-performing entities, on a competitive basis, to receive subgrants in order to validate and grow effective interventions.

“(c) Program authorized.—

“(1) IN GENERAL.—From amounts made available to carry out this section, the Secretary shall award grants, on a competitive basis, to eligible entities to enable the eligible entities to create, develop, implement, replicate, or scale evidence-based and field-initiated innovations, including through pay for success initiatives (as defined in section 124(a)), in order to improve postsecondary access and completion for high-need students.

“(2) GRANTS.—The grants awarded under this section shall, to the extent practicable based on the strength of the applications, include—

“(A) early-phase grants to fund the development, implementation, and feasibility testing of a practice, program, or intervention that prior research suggests has promise, for the purpose of determining whether the practice, program, or innovation can successfully improve access to, retention in, and completion of, a postsecondary program of study for high-need students;

“(B) mid-phase grants to fund implementation and a rigorous evaluation of a practice, program, or intervention that has been successfully implemented under an early phase grant described in subparagraph (A) or another effort meeting similar criteria, for the purpose of measuring (using existing administrative data where possible) the impact and cost-effectiveness of the practice, program, or intervention; and

“(C) expansion grants to fund implementation and a rigorous replication evaluation of a practice, program, or intervention that has been found to produce sizable, important impacts under a mid-phase grant described in subparagraph (B) or another effort meeting similar criteria, for the purposes of—

“(i) determining whether such impacts can be successfully reproduced and sustained over time; and

“(ii) identifying the conditions in which the practice, program, or initiative is most effective.

“(d) Application.—An eligible entity desiring a grant under this section shall submit to the Secretary an application at such time, in such manner, and containing such information as the Secretary may require, including a description of the outcome measures that the eligible entity will use to evaluate the success of the grant.

“(e) Priority.—In awarding grants under this section, the Secretary shall give priority to eligible entities that—

“(1) propose to serve the largest number of students; or

“(2) serve a high proportion of students from one or more school districts with a school district locale code of 31, 32, 33, 41, 42, or 43, as determined by the Secretary.

“(f) Evaluations.—Each recipient of a grant under this section shall conduct, and submit to the Secretary, a rigorous, independent evaluation of—

“(1) the effectiveness of the practice, program, or initiative carried out under such grant;

“(2) the outcomes achieved by such grant, based on the outcome measures described in the application under subsection (d); and

“(3) the activities carried out under such grant.

“(g) Reports.—

“(1) IN GENERAL.—By not later than 2 years after the date of enactment of the Fund for Innovation and Success in Higher Education Act, and every 2 years thereafter, the Secretary shall prepare and submit to the authorizing committees a report on the grants carried out under this section.

“(2) CONTENTS.—Each report issued under this subsection shall—

“(A) include information from the evaluations submitted under subsection (f) on the success of the grants, based on the outcomes reported in the evaluations under such subsection; and

“(B) consider—

“(i) how the tiered-evidence grant structure described in subsection (c)(2) can be applied to other grant programs authorized under this Act, in order to strengthen those programs; and

“(ii) how the evidence generated by the projects, programs, and initiatives supported by grants under this section can inform how to carry out other grants authorized under this Act.

“(3) PUBLIC AVAILABILITY.—The Secretary shall make each report issued under this subsection available to the public through the website of the Department.”.

SEC. 3. Open educational resources.

Section 741(a) of the Higher Education Act of 1965 (20 U.S.C. 1138(a)) is amended—

(1) in paragraph (12), by striking “and” after the semicolon;

(2) in paragraph (13), by striking the period and inserting “; and”; and

(3) by adding at the end the following:

“(14) making all forms of postsecondary instructional content widely available, which may include the use of open educational resources (defined, for purpose of this paragraph, as teaching, learning, or research resources that reside in the public domain or have been released under a copyright license that permits their free use, reuse, modification, and sharing with others).”.

SEC. 4. Pay for success initiatives.

Part B of title I of the Higher Education Act of 1965 (20 U.S.C. 1011 et seq.) is amended by adding at the end the following:

“SEC. 124. Pay for success initiatives.

“(a) Definitions.—In this section:

“(1) ELIGIBLE ENTITY.—The term ‘eligible entity’ means a partnership between—

“(A) a private entity (which may include a private nonprofit entity); and

“(B) an institution of higher education, a Federal, State, or local public entity, or a Tribal entity.

“(2) PAY FOR SUCCESS INITIATIVE.—

“(A) IN GENERAL.—The term ‘pay for success initiative’ means a performance-based grant, contract, or other agreement—

“(i) between an eligible entity and the Secretary or a grant recipient, as authorized under subsection (b)(1);

“(ii) in which—

“(I) a commitment is made to pay the eligible entity for improved outcomes that result in increased public value and social benefit to students and the public sector, such as increased effectiveness in improving outcomes, direct cost savings or cost avoidance, or increased public revenue; and

“(II) the person providing the funds under the grant, contract, or agreement imposes minimal administrative requirements to allow for maximum flexibility to achieve increased public value and social benefit;

“(iii) that requires—

“(I) a feasibility study describing how the proposed intervention is based on evidence of effectiveness, which may be a feasibility study not exclusively developed for the specific grant, contract, or other agreement;

“(II) a rigorous, third-party evaluation that uses experimental or quasi-experimental design or other research methodologies that allow for the strongest possible causal inferences to determine whether the initiative has met its proposed outcomes;

“(III) an annual, publicly available report on the progress of the initiative; and

“(IV) that payments be made to the recipient of the grant, contract, or agreement only when agreed-upon outcomes are achieved, except as provided under paragraph (2) or (3) of subsection (b).

“(B) EXCLUSION.—The term ‘pay for success initiative’ does not include any initiative that—

“(i) reduces the benefits to a student or the obligations of an entity under this Act, the Rehabilitation Act of 1973 (29 U.S.C. 701 et seq.), the Americans with Disabilities Act of 1990 (42 U.S.C. 12101 et seq.), the Individuals with Disabilities Education Act (20 U.S.C. 1400 et seq.), or any other law; or

“(ii) reduces services that an individual is entitled to receive under Federal, State, or local law.

“(b) Pay for success initiative authority.—

“(1) IN GENERAL.—Notwithstanding any other provision of this Act and except as provided under subsection (c)—

“(A)(i) any recipient of a grant under this Act may request to use grant funds to carry out a pay for success initiative that accomplishes the objectives of the grant and meets all requirements of the grant (except to the extent a requirement is specifically modified by the pay for success initiative), if such use is proposed in the application or plan submitted for such grant; and

“(ii) the Secretary may approve not more than 5 pilot demonstrations each fiscal year from the grant applications or plans that contain a request to carry out a pay for success initiative;

“(B) if the Secretary has any funds reserved for the Secretary under this Act remaining after the Secretary has met the applicable requirements for such funds, the Secretary may, through a competitive process, use the remaining funds to carry out additional pilot demonstrations of pay for success initiatives that accomplishes the objectives of this Act.

“(2) USE OF FUNDS FOR FEASIBILITY STUDIES AND RIGOROUS THIRD-PARTY EVALUATION.—If the Secretary, or a grant recipient, is authorized to carry out a pay for success initiative under paragraph (1), the Secretary or grant recipient may use funds available for the pay for success initiative—

“(A) to conduct the feasibility study required under subsection (a)(2)(A)(iii)(I) or the rigorous third-party evaluation required under subsection (a)(2)(A)(iii)(II); or

“(B) to provide funds to the entity carrying out the pay for success initiative for the costs of the initial costs associated with starting the initiative.

“(3) USE OF REMAINING FUNDS.—Notwithstanding any other provision of law, if the Secretary or a grant recipient is authorized to carry out a pay for success initiative under paragraph (1), the Secretary or grant recipient may use any funds remaining at the conclusion of the pay for success initiative to enter into an additional agreement with the eligible entity to expand capacity under the pay for success initiative, if the initiative has met or exceeded its proposed outcomes.

“(c) Student protections.—

“(1) NO NEGATIVE IMPACT ON STUDENT AID.—A pay for success initiative shall not be supported with funds under this Act if the pay for success initiative would adversely affect the funding of, or student access to, individual student aid awards made under section 401 or any other program supported under this Act.

“(2) NONINCLUSION IN DETERMINATION OF NEED.—A grant or aid provided directly to a student under a pay for success initiative supported with funds under this Act shall not be considered in determining that student’s need for grant, loan, or work assistance under title IV of this Act, except that in no case shall the total amount of student financial assistance awarded to a student through a pay for success initiative and under title IV exceed that student’s cost of attendance, as defined in section 472.

“(d) Availability of funds.—Notwithstanding any other provision of this Act, any funds made available for a fiscal year to an entity for a pay for success initiative authorized under this section shall remain available until expended.”.

SEC. 5. Evaluation.

Part B of title I of the Higher Education Act of 1965 (20 U.S.C. 1011 et seq.), as amended by section 4, is further amended by adding at the end the following:

“SEC. 125. Evaluation authority.

“(a) Evaluation reservation.—

“(1) IN GENERAL.—Notwithstanding any other provision of this Act, the Secretary, in consultation with the Director of the Institute of Education Sciences, may, for each fiscal year, reserve not more than 1 percent of the amount appropriated for each program authorized under this Act (except for the Federal Pell Grant program under section 401) in order to rigorously and independently evaluate the effectiveness and efficiency of the outcomes of all programs authorized under this Act.

“(2) EFFECT ON OTHER REQUIREMENTS.—The amount reserved under paragraph (1) shall be in addition to any other amounts reserved for evaluation under this Act.

“(b) Evaluation plan.—On a biennial basis, the Director of the Institute of Education Sciences shall develop, submit to the authorizing committees, and make publicly available on the website of the Department, an evaluation plan for the next 2 fiscal years that—

“(1) describes the specific activities that will be carried out under subsection (a) for the 2-year period applicable to the plan, and the timelines of such activities;

“(2) contains the results of the activities carried out under subsection (a) for the most recent 2-year period; and

“(3) describes how programs authorized under this Act will be regularly evaluated, including the outcome measures to be used to evaluate each program.

“(c) Pooling authority.—Notwithstanding any other provision of this Act, the Secretary, in consultation with the Director of the Institute of Education Sciences—

“(1) may consolidate the funds reserved under subsection (a) for purposes of carrying out the activities described in subsection (b); and

“(2) shall not be required to evaluate each program authorized under this Act each year.

“(d) Rule of construction.—Nothing in this section shall be construed to conflict with or supercede any other evaluation requirement for a specific program or activity authorized under this Act.”.


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