 
      CHAPTER 28--HIGHER EDUCATION RESOURCES AND STUDENT ASSISTANCE
 
                    SUBCHAPTER IV--STUDENT ASSISTANCE
 
                      Part D--Federal Perkins Loans
 
Sec. 1087ee. Cancellation of loans for certain public service


(a) Cancellation of percentage of debt based on years of qualifying 
        service

    (1) The percent specified in paragraph (3) of this subsection of the 
total amount of any loan made after June 30, 1972, from a student loan 
fund assisted under this part shall be canceled for each complete year 
of service after such date by the borrower under circumstances described 
in paragraph (2).
    (2) Loans shall be canceled under paragraph (1) for service--
        (A) as a full-time teacher for service in an academic year in a 
    public or other nonprofit private elementary or secondary school 
    which is in the school district of a local educational agency which 
    is eligible in such year for assistance pursuant to title I of the 
    Elementary and Secondary Education Act of 1965 [20 U.S.C. 6301 et 
    seq.], and which for the purpose of this paragraph and for that year 
    has been determined by the Secretary (pursuant to regulations and 
    after consultation with the State educational agency of the State in 
    which the school is located) to be a school in which the enrollment 
    of children counted under section 111(c) of the Elementary and 
    Secondary Education Act of 1965 \1\ exceeds 30 percent of the total 
    enrollment of that school;
---------------------------------------------------------------------------
    \1\ See References in Text note below.
---------------------------------------------------------------------------
        (B) as a full-time staff member in a preschool program carried 
    on under the Head Start Act [42 U.S.C. 9831 et seq.] which is 
    operated for a period which is comparable to a full school year in 
    the locality if the salary of such staff member is not more than the 
    salary of a comparable employee of the local educational agency;
        (C) as a full-time special education teacher, including teachers 
    of infants, toddlers, children, or youth with disabilities in a 
    public or other nonprofit elementary or secondary school system, or 
    as a full-time qualified professional provider of early intervention 
    services in a public or other nonprofit program under public 
    supervision by the lead agency as authorized in section 1435(a)(10) 
    of this title;
        (D) as a member of the Armed Forces of the United States, for 
    service that qualifies for special pay under section 310 of title 37 
    as an area of hostilities;
        (E) as a volunteer under the Peace Corps Act [22 U.S.C. 2501 et 
    seq.] or a volunteer under the Domestic Volunteer Service Act of 
    1973 [42 U.S.C. 4950 et seq.];
        (F) as a full-time law enforcement officer or corrections 
    officer for service to local, State, or Federal law enforcement or 
    corrections agencies;
        (G) as a full-time teacher of mathematics, science, foreign 
    languages, bilingual education, or any other field of expertise 
    where the State educational agency determines there is a shortage of 
    qualified teachers;
        (H) as a full-time nurse or medical technician providing health 
    care services; or
        (I) as a full-time employee of a public or private nonprofit 
    child or family service agency who is providing, or supervising the 
    provision of, services to high-risk children who are from low-income 
    communities and the families of such children.

For the purpose of this paragraph, the term ``children with 
disabilities'' has the meaning set forth in section 1401 of this title.
    (3)(A) The percent of a loan which shall be canceled under paragraph 
(1) of this subsection is--
        (i) in the case of service described in subparagraph (A), (C), 
    (F), (G), (H), or (I) of paragraph (2), at the rate of 15 percent 
    for the first or second year of such service, 20 percent for the 
    third or fourth year of such service, and 30 percent for the fifth 
    year of such service;
        (ii) in the case of service described in subparagraph (B) of 
    paragraph (2), at the rate of 15 percent for each year of such 
    service;
        (iii) in the case of service described in subparagraph (D) of 
    paragraph (2), not to exceed a total of 50 percent of such loan at 
    the rate of 12\1/2\ percent for each year of qualifying service; or
        (iv) in the case of service described in subparagraph (E) of 
    paragraph (2) at the rate of 15 percent for the first or second year 
    of such service and 20 percent for the third or fourth year of such 
    service.

    (B) If a portion of a loan is canceled under this subsection for any 
year, the entire amount of interest on such loan which accrues for such 
year shall be canceled.
    (C) Nothing in this subsection shall be construed to authorize 
refunding of any repayment of a loan.
    (4) For the purpose of this subsection, the term ``year'' where 
applied to service as a teacher means academic year as defined by the 
Secretary.
    (5) The amount of a loan, and interest on a loan, which is canceled 
under this section shall not be considered income for purposes of title 
26.
    (6) No borrower may, for the same volunteer service, receive a 
benefit under both this section and subtitle D of title I of the 
National and Community Service Act of 1990 [42 U.S.C. 12601 et seq.].
    (7) An individual with an outstanding loan obligation under this 
part who performs service of any type that is described in paragraph (2) 
as in effect on October 7, 1998, shall be eligible for cancellation 
under this section for such service notwithstanding any contrary 
provision of the promissory note under which the loan or loans were 
made, and notwithstanding any amendment (or effective date provision 
relating to any amendment) to this section made prior to the date of 
such service.

(b) Reimbursement for cancellation

    The Secretary shall pay to each institution for each fiscal year an 
amount equal to the aggregate of the amounts of loans from its student 
loan fund which are canceled pursuant to this section for such year, 
minus an amount equal to the aggregate of the amounts of any such loans 
so canceled which were made from Federal capital contributions to its 
student loan fund provided by the Secretary under section 1087hh of this 
title. None of the funds appropriated pursuant to section 1087aa(b) of 
this title shall be available for payments pursuant to this subsection. 
To the extent feasible, the Secretary shall pay the amounts for which 
any institution qualifies under this subsection not later than 3 months 
after the institution files an institutional application for campus-
based funds.

(c) Special rules

                              (1) List

        If the list of schools in which a teacher may perform service 
    pursuant to subsection (a)(2)(A) of this section is not available 
    before May 1 of any year, the Secretary may use the list for the 
    year preceding the year for which the determination is made to make 
    such service determination.

                     (2) Continuing eligibility

        Any teacher who performs service in a school which--
            (A) meets the requirements of subsection (a)(2)(A) of this 
        section in any year; and
            (B) in a subsequent year fails to meet the requirements of 
        such subsection,

    may continue to teach in such school and shall be eligible for loan 
    cancellation pursuant to subsection (a)(1) of this section such 
    subsequent years.

(Pub. L. 89-329, title IV, Sec. 465, as added Pub. L. 99-498, title IV, 
Sec. 405(a), Oct. 17, 1986, 100 Stat. 1451; amended Pub. L. 100-50, 
Sec. 13(j), June 3, 1987, 101 Stat. 349; Pub. L. 100-369, Sec. 7(c), 
July 18, 1988, 102 Stat. 837; Pub. L. 101-476, title IX, Sec. 901(e), 
Oct. 30, 1990, 104 Stat. 1151; Pub. L. 101-647, title XXI, Sec. 2101(a), 
(b), Nov. 29, 1990, 104 Stat. 4856; Pub. L. 102-119, Sec. 26(h), Oct. 7, 
1991, 105 Stat. 607; Pub. L. 102-325, title IV, Sec. 465(a)-(c), July 
23, 1992, 106 Stat. 582, 583; Pub. L. 103-82, title I, Sec. 102(c)(3), 
Sept. 21, 1993, 107 Stat. 824; Pub. L. 103-208, Sec. 2(f)(12)-(14), 
(k)(7), Dec. 20, 1993, 107 Stat. 2471, 2486; Pub. L. 103-382, title III, 
Sec. 391(e)(3), Oct. 20, 1994, 108 Stat. 4022; Pub. L. 105-244, title 
IV, Sec. 465, Oct. 7, 1998, 112 Stat. 1728.)

                       References in Text

    The Elementary and Secondary Education Act of 1965, referred to in 
subsec. (a)(2)(A), is Pub. L. 89-10, Apr. 11, 1965, 79 Stat. 27, as 
amended generally by Pub. L. 103-382, title I, Sec. 101, Oct. 20, 1994, 
108 Stat. 3519. Title I of the Act is classified generally to subchapter 
I (Sec. 6301 et seq.) of chapter 70 of this title. For complete 
classification of this Act to the Code, see Short Title note set out 
under section 6301 of this title and Tables.
    Section 111(c) of the Elementary and Secondary Education Act of 
1965, referred to in subsec. (a)(2)(A), was classified to section 
2711(c) of this title, prior to its omission in the general revision of 
the Elementary and Secondary Education Act of 1965 by Pub. L. 100-297, 
title I, Sec. 1001, Apr. 28, 1988, 102 Stat. 140.
    The Head Start Act, referred to in subsec. (a)(2)(B), is subchapter 
B (Secs. 635 to 657) of chapter 8 of subtitle A of title VI of Pub. L. 
97-35, Aug. 13, 1981, 95 Stat. 499, as amended, which is classified 
generally to subchapter II (Sec. 9831 et seq.) of chapter 105 of Title 
42, The Public Health and Welfare. For complete classification of this 
Act to the Code, see Short Title note set out under section 9801 of 
Title 42 and Tables.
    The Peace Corps Act, referred to in subsec. (a)(2)(E), is Pub. L. 
87-293, Sept. 22, 1961, 75 Stat. 612, as amended, which is classified 
principally to chapter 34 (Sec. 2501 et seq.) of Title 22, Foreign 
Relations and Intercourse. For complete classification of this Act to 
the Code, see Short Title note set out under section 2501 of Title 22 
and Tables.
    The Domestic Volunteer Service Act of 1973, referred to in subsec. 
(a)(2)(E), is Pub. L. 93-113, Oct. 1, 1973, 87 Stat. 394, as amended, 
which is classified principally to chapter 66 (Sec. 4950 et seq.) of 
Title 42, The Public Health and Welfare. For complete classification of 
this Act to the Code, see Short Title note set out under section 4950 of 
Title 42 and Tables.
    The National and Community Service Act of 1990, referred to in 
subsec. (a)(6), is Pub. L. 101-610, Nov. 16, 1990, 104 Stat. 3127, as 
amended. Subtitle D of title I of the Act is classified generally to 
division D of subchapter I (Sec. 12601 et seq.) of chapter 129 of Title 
42. For complete classification of this Act to the Code, see Short Title 
note set out under section 12501 of Title 42 and Tables.

                          Codification

    Amendment by section 2(f)(14) of Pub. L. 103-208 (which was 
effective as if included in Pub. L. 102-325) was executed to this 
section as amended by Pub. L. 102-325 and Pub. L. 103-82, to reflect the 
probable intent of Congress.


                            Prior Provisions

    A prior section 1087ee, Pub. L. 89-329, title IV, Sec. 465, as added 
Pub. L. 92-318, title I, Sec. 137(b), June 23, 1972, 86 Stat. 277; 
amended Pub. L. 95-561, title XIII, Sec. 1323, Nov. 1, 1978, 92 Stat. 
2363; Pub. L. 96-374, title IV, Secs. 442(b)(6), 448(d), (e), title 
XIII, Sec. 1391(a)(1), Oct. 3, 1980, 94 Stat. 1440, 1443, 1503, related 
to cancellation of loans for certain public service, prior to the 
general revision of this part by Pub. L. 99-498.


                               Amendments

    1998--Subsec. (a)(2). Pub. L. 105-244, Sec. 465(1)(B), substituted 
``section 1401'' for ``section 1401(a)(1)'' in concluding provisions.
    Subsec. (a)(2)(C). Pub. L. 105-244, Sec. 465(1)(A), substituted 
``section 1435(a)(10)'' for ``section 1476(b)(9)''.
    Subsec. (a)(7). Pub. L. 105-244, Sec. 465(1)(C), added par. (7).
    Subsec. (b). Pub. L. 105-244, Sec. 465(2), inserted at end ``To the 
extent feasible, the Secretary shall pay the amounts for which any 
institution qualifies under this subsection not later than 3 months 
after the institution files an institutional application for campus-
based funds.''
    1994--Subsec. (a)(2)(A). Pub. L. 103-382 substituted ``title I of 
the Elementary and Secondary Education Act of 1965'' for ``chapter 1 of 
the Education Consolidation and Improvement Act of 1981''.
    1993--Subsec. (a)(2)(A). Pub. L. 103-208, Sec. 2(k)(7), amended Pub. 
L. 102-325, Sec. 465(a)(1). See 1992 Amendment note below.
    Subsec. (a)(2)(D). Pub. L. 103-208, Sec. 2(f)(12), substituted 
``service'' for ``services''.
    Subsec. (a)(2)(F). Pub. L. 103-208, Sec. 2(f)(13), struck out ``or'' 
after semicolon at end.
    Subsec. (a)(6). Pub. L. 103-208, Sec. 2(f)(14), realigned margin. 
See Codification note above.
    Pub. L. 103-82 added par. (6).
    1992--Subsec. (a)(2)(A). Pub. L. 102-325, Sec. 465(a)(1), as amended 
by Pub. L. 103-208, Sec. 2(k)(7), struck out before semicolon at end 
``and such determination shall not be made with respect to more than 50 
percent of the total number of schools in the State receiving assistance 
under such chapter 1''.
    Subsec. (a)(2)(C). Pub. L. 102-325, Sec. 465(a)(2), amended subpar. 
(C) generally. Prior to amendment, subpar. (C) read as follows: ``as a 
full-time teacher of children with disabilities in a public or other 
nonprofit elementary or secondary school system;''.
    Subsec. (a)(2)(G) to (I). Pub. L. 102-325, Sec. 465(a)(3)-(5), added 
subpars. (G) to (I).
    Subsec. (a)(3)(A)(i). Pub. L. 102-325, Sec. 465(b), substituted 
``(A), (C), (F), (G), (H), or (I)'' for ``(A), (C), or (F)''.
    Subsec. (c). Pub. L. 102-325, Sec. 465(c), added subsec. (c).
    1991--Subsec. (a)(2). Pub. L. 102-119 substituted ``1401(a)(1)'' for 
``1401(1)'' in last sentence. The references to section 1401 include the 
substitution of ``Individuals with Disabilities Education Act'' for 
``Education of the Handicapped Act'' in the original.
    1990--Subsec. (a)(2). Pub. L. 101-476, Sec. 901(e), substituted 
``children with disabilities'' for ``handicapped children'' in two 
places.
    Subsec. (a)(2)(F). Pub. L. 101-647, Sec. 2101(a), which directed 
amendment of subsec. (a)(2) by adding at the end a new subpar. (F), was 
executed by adding subpar. (F) after subpar. (E) and before last 
sentence to reflect the probable intent of Congress.
    Subsec. (a)(3)(A)(i). Pub. L. 101-647, Sec. 2101(b), which directed 
amendment of subsec. (a)(3)(i) by substituting ``(A), (C), or (F)'' for 
``(A) or (C)'', was executed by making the substitution in subsec. 
(a)(3)(A)(i) to reflect the probable intent of Congress.
    1988--Subsec. (a)(5). Pub. L. 100-369 substituted ``Internal Revenue 
Code of 1986'' for ``Internal Revenue Code of 1954'', which for purposes 
of codification was translated as ``title 26'' thus requiring no change 
in text.
    1987--Subsec. (a)(2)(A). Pub. L. 100-50, Sec. 13(j)(1), (2), 
substituted ``chapter 1 of the Education Consolidation and Improvement 
Act of 1981'' for ``title I of the Elementary and Secondary Education 
Act of 1965'' and ``such chapter 1'' for ``such title I''.
    Subsec. (a)(2)(B). Pub. L. 100-50, Sec. 13(j)(3), substituted ``the 
Head Start Act'' for ``section 2809(a)(1) of title 42''.


                    Effective Date of 1998 Amendment

    Amendment by Pub. L. 105-244 effective Oct. 1, 1998, except as 
otherwise provided in Pub. L. 105-244, see section 3 of Pub. L. 105-244, 
set out as a note under section 1001 of this title.


                    Effective Date of 1993 Amendments

    Amendment by Pub. L. 103-208 effective as if included in the Higher 
Education Amendments of 1992, Pub. L. 102-325, except as otherwise 
provided, see section 5(a) of Pub. L. 103-208, set out as a note under 
section 1051 of this title.
    Amendment by Pub. L. 103-82 effective Oct. 1, 1993, see section 123 
of Pub. L. 103-82, set out as a note under section 1701 of Title 16, 
Conservation.


                    Effective Date of 1990 Amendments

    Section 2101(c) of Pub. L. 101-647 provided that: ``The amendments 
made by this section [amending this section] shall apply only to loans 
made on or after the date of enactment of this Act [Nov. 29, 1990] under 
part E of title IV of the Higher Education Act of 1965 [this part].''
    Section 1001 of Pub. L. 101-476 provided that: ``The amendments made 
by this Act [see Short Title of 1990 Amendment note set out under 
section 1400 of this title] shall take effect October 1, 1990.''


                    Effective Date of 1987 Amendment

    Amendment by Pub. L. 100-50 effective as if enacted as part of the 
Higher Education Amendments of 1986, Pub. L. 99-498, see section 27 of 
Pub. L. 100-50, set out as a note under section 1001 of this title.


                             Effective Date

    Section effective Oct. 17, 1986, except as otherwise provided, see 
section 2 of Pub. L. 99-498, set out as a note under section 1001 of 
this title.
    Subsection (a)(2)(E) of this section applicable only to loans made 
to cover the costs of instruction for periods of enrollment beginning on 
or after July 1, 1987, to individuals who are new borrowers on that 
date, see section 405(b) of Pub. L. 99-498, set out as a note under 
section 1087dd of this title.

                  Section Referred to in Other Sections

    This section is referred to in sections 1078-10, 1087, 1087j, 
1087dd, 1092 of this title.
