 
      CHAPTER 28--HIGHER EDUCATION RESOURCES AND STUDENT ASSISTANCE
 
                    SUBCHAPTER IV--STUDENT ASSISTANCE
 
           Part C--William D. Ford Federal Direct Loan Program
 
Sec. 1087j. Loan cancellation for teachers


(a) Statement of purpose

    It is the purpose of this section to encourage individuals to enter 
and continue in the teaching profession.

(b) Program authorized

                           (1) In general

        The Secretary shall carry out a program of canceling the 
    obligation to repay a qualified loan amount in accordance with 
    subsection (c) of this section for Federal Direct Stafford Loans and 
    Federal Direct Unsubsidized Stafford Loans made under this part for 
    any new borrower on or after October 1, 1998, who--
            (A) has been employed as a full-time teacher for 5 
        consecutive complete school years--
                (i) in a school that qualifies under section 
            1087ee(a)(2)(A) of this title for loan cancellation for 
            Perkins loan recipients who teach in such schools;
                (ii) if employed as a secondary school teacher, is 
            teaching a subject area that is relevant to the borrower's 
            academic major as certified by the chief administrative 
            officer of the public or non-profit private secondary school 
            in which the borrower is employed; and
                (iii) if employed as an elementary school teacher, has 
            demonstrated, as certified by the chief administrative 
            officer of the public or nonprofit private elementary school 
            in which the borrower is employed, knowledge and teaching 
            skills in reading, writing, mathematics and other areas of 
            the elementary school curriculum; and

            (B) is not in default on a loan for which the borrower seeks 
        forgiveness.

                          (2) Special rule

        No borrower may obtain a reduction of loan obligations under 
    both this section and section 1078-10 of this title.

(c) Qualified loan amounts

                           (1) In general

        The Secretary shall cancel not more than $5,000 in the aggregate 
    of the loan obligation on a Federal Direct Stafford Loan or a 
    Federal Direct Unsubsidized Stafford Loan that is outstanding after 
    the completion of the fifth complete school year of teaching 
    described in subsection (b)(1)(A) of this section.

                (2) Treatment of consolidation loans

        A loan amount for a Federal Direct Consolidation Loan may be a 
    qualified loan amount for the purposes of this subsection only to 
    the extent that such loan amount was used to repay a Federal Direct 
    Stafford Loan, a Federal Direct Unsubsidized Stafford Loan, or a 
    loan made under section 1078 or 1078-8 of this title, for a borrower 
    who meets the requirements of subsection (b) of this section, as 
    determined in accordance with regulations prescribed by the 
    Secretary.

(d) Regulations

    The Secretary is authorized to issue such regulations as may be 
necessary to carry out the provisions of this section.

(e) Construction

    Nothing in this section shall be construed to authorize any 
refunding of any canceled loan.

(f) List

    If the list of schools in which a teacher may perform service 
pursuant to subsection (b) 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.

(g) Additional eligibility provisions

                      (1) Continued eligibility

        Any teacher who performs service in a school that--
            (A) meets the requirements of subsection (b)(1)(A) of this 
        section in any year during such service; 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 (b) of 
        this section.

                  (2) Prevention of double benefits

        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.].

(h) ``Year'' defined

    For the purpose of this section, the term ``year'' where applied to 
service as a teacher means an academic year as defined by the Secretary.

(Pub. L. 89-329, title IV, Sec. 460, as added Pub. L. 105-244, title IV, 
Sec. 456, Oct. 7, 1998, 112 Stat. 1719.)

                       References in Text

    The National and Community Service Act of 1990, referred to in 
subsec. (g)(2), 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, The Public Health and Welfare. For complete classification of this 
Act to the Code, see Short Title note set out under section 12501 of 
Title 42 and Tables.


                             Effective Date

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

                  Section Referred to in Other Sections

    This section is referred to in section 1078-10 of this title.
