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March 20, 2026
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Download official Senate Record PDFReturn to issue contextSA 4723. Mr. MERKLEY submitted an amendment intended to be proposed by him to the bill S. 1383, to establish the Veterans Advisory Committee on Equal Access, and for other purposes; which was ordered to lie on the table; as follows:
Strike all after the enacting clause and insert the
following:
SECTION 1. SHORT TITLE.
This Act may be cited as the “Savings Opportunity and
Affordable Repayment Act”.
SEC. 2. AMENDMENTS TO THE OBBBA.
(a) In General.—Section 82001 of the Act titled “An Act
to provide for reconciliation pursuant to title II of H. Con.
Res. 14” (Public Law 119-21; 139 Stat. 72) is amended by
striking subsections (a) and (c).
(b) Higher Education Act of 1965.—The Higher Education Act
of 1965 (20 U.S.C. 1001 et seq.) is amended—
(1) in section 428(b)(9)(A)(v), by inserting “who has a
partial financial hardship” after “enables a borrower”;
(2) in section 455—
(A) in subsection (d)—
(i) in paragraph (1)—
(I) in the matter preceding subparagraph (A), by striking
“before July 1, 2026, who has not received a loan made under
this part on or after July 1, 2026,”;
(II) in subparagraph (D)—
(aa) by striking “before June 30, 2028,”; and
(bb) by inserting “and” after the semicolon;
(III) in subparagraph (E)—
(aa) by inserting “that enables borrowers who have a
partial financial hardship to make a lower monthly payment”
after “an income-based repayment plan”; and
(bb) by striking “an excepted Consolidation Loan (as
defined in section 493C(a)(2)); and” and inserting “a
Federal Direct Consolidation Loan, if the proceeds of such
loan were used to discharge the liability on such Federal
Direct PLUS Loan or a loan under section 428B made on behalf
of a dependent student.”; and
(IV) by striking subparagraph (F);
(ii) in paragraph (5), by striking subparagraph (B) and
inserting the following:
“(B) repay the loan pursuant to an income contingent
repayment plan.”; and
(iii) by striking paragraphs (6) and (7);
(B) in subsection (g), by striking paragraph (3);
(C) by striking subsection (q); and
(3) in section 493C—
(A) in subsection (a)—
(i) by striking paragraph (2) and inserting the following:
“(2) Excepted consolidation loan.—The term `excepted
consolidation loan' means a consolidation loan under section
428C, or a Federal Direct Consolidation Loan, if the proceeds
of such loan were used to the discharge the liability on an
excepted PLUS loan.”; and
(ii) by striking paragraph (3) and inserting the following:
“(3) Partial financial hardship.—The term `partial
financial hardship', when used with respect to a borrower,
means that for such borrower—
“(A) the annual amount due on the total amount of loans
made, insured, or guaranteed under part B or D (other than an
excepted PLUS loan or excepted consolidation loan) to a
borrower as calculated under the standard repayment plan
under section 428(b)(9)(A)(i) or 455(d)(1)(A), based on a 10-
year repayment period; exceeds
“(B) 15 percent of the result obtained by calculating, on
at least an annual basis, the amount by which—
“(i) the borrower's, and the borrower's spouse's (if
applicable), adjusted gross income; exceeds
“(ii) 150 percent of the poverty line applicable to the
borrower's family size as determined under section 673(2) of
the Community Services Block Grant Act (42 U.S.C.
9902(2)).”;
(B) in subsection (b)—
(i) by striking paragraph (1) and inserting the following:
“(1) a borrower of any loan made, insured, or guaranteed
under part B or D (other than an excepted PLUS loan or
excepted consolidation loan) who has a partial financial
hardship (whether or not the borrower's loan has been
submitted to a guaranty agency for default aversion or had
been in default) may elect, during any period the borrower
has the partial financial hardship, to have the borrower's
aggregate monthly payment for all such loans not exceed the
result described in subsection (a)(3)(B) divided by 12;”;
and
(ii) by striking paragraph (6) and inserting the following:
“(6) if the borrower no longer has a partial financial
hardship or no longer wishes to continue the election under
this subsection, then—
“(A) the maximum monthly payment required to be paid for
all loans made to the borrower under part B or D (other than
an excepted PLUS loan or excepted consolidation loan) shall
not exceed the monthly amount calculated under section
428(b)(9)(A)(i) or 455(d)(1)(A), based on a 10-year repayment
period, when the borrower first made the election described
in this subsection; and
“(B) the amount of time the borrower is permitted to repay
such loans may exceed 10 years;”;
(C) by striking subsection (c) and inserting the following:
“(c) Eligibility Determinations.—
“(1) In general.—The Secretary shall establish procedures
for annually determining the borrower's eligibility for
income-based repayment, including verification of a
borrower's annual income and the annual amount due on the
total amount of loans made, insured, or guaranteed under part
B or D (other than an excepted PLUS loan or excepted
consolidation loan), and such other procedures as are
necessary to effectively implement income-based repayment
under this section.
“(2) Procedures for eligibility.—The Secretary shall—
“(A) consider, but is not limited to, the procedures
established in accordance with section 455(e)(1) or in
connection with income sensitive repayment schedules under
section 428(b)(9)(A)(iii) or 428C(b)(1)(E); and
“(B) carry out, with respect to borrowers of any loan made
under part D (other than an excepted PLUS loan or excepted
consolidation loan), procedures for income-based repayment
plans that are equivalent to the procedures carried out under
section 455(e)(8) with respect to income-contingent repayment
plans.”; and
(D) in subsection (e)—
(i) in the subsection heading, by striking “and Before
July 1, 2026”; and
(ii) by striking “and before July 1, 2026”.
SEC. 3. SAVINGS OPPORTUNITY AND AFFORDABLE REPAYMENT PLAN.
The Higher Education Act of 1965 (20 U.S.C. 1001 et seq.),
as amended by section 2, is further amended—
(1) in section 428(b)(9)(A)—
(A) in clause (iv), by striking “and” after the
semicolon;
(B) in clause (v), by striking the period at the end and
inserting “; and”; and
(C) by adding at the end the following:
“(vi) beginning on the date that is 180 days after the
date of enactment of the Savings Opportunity and Affordable
Repayment Act, an income contingent repayment plan known as
the `Savings Opportunity and Affordable Repayment plan',
consistent with section 493E.”;
(2) in section 428C(c)(2)(A)—
(A) in the first sentence, by striking “or income-based”
and inserting “income-based, or income contingent Savings
Opportunity and Affordable Repayment (consistent with section
493E)”; and
(B) in the second sentence, by striking “or income-based”
and inserting “income-based, or income contingent Savings
Opportunity and Affordable Repayment”;
(3) in section 455(d)—
(A) in paragraph (1), by striking subparagraph (D) and
inserting the following:
“(D) except as provided in paragraph (6), an income
contingent repayment plan—
“(i) with varying annual repayment amounts based on the
income of the borrower, paid over an extended period of time
prescribed by the Secretary, not to exceed 25 years, except
that the plan described in this clause shall not be available
to the borrower of a Federal Direct PLUS loan made on behalf
of a dependent student; and
“(ii) which, beginning on the date that is 180 days after
the date of enactment of the Savings Opportunity and
Affordable Repayment Act, shall include the `Savings
Opportunity and Affordable Repayment plan', consistent with
section 493E; and”; and
(B) by adding at the end the following:
“(6) Phase outs.—
“(A) PAYE repayment plan.—
“(i) In general.—A borrower may choose the Pay As You
Earn Repayment Plan, as described in section 685.209 of title
34, Code of Federal Regulations (as in effect on January 19,
2025), as an income contingent repayment plan pursuant to
paragraph (1)(D)—
“(I) before the date that is 2 years after the date of
enactment of the Savings Opportunity and Affordable Repayment
Act, only if the borrower—
“(aa) has loans eligible for repayment under such plan, as
described in such section as in effect on such date; and
“(bb) has a partial financial hardship when the borrower
initially enters such plan, as described in such section as
in effect on such date; and
“(II) on or after the date that is 2 years after the date
of enactment of the Savings Opportunity and Affordable
Repayment Act, only if the borrower meets the conditions
described in subclause (I) and was repaying a loan under such
plan before such date that is 2 years after the date of
enactment of the Savings Opportunity and Affordable Repayment
Act.
“(ii) Prohibition against re-enrollment.—Beginning on the
date that is 2 years after the date of enactment of the
Savings Opportunity and Affordable Repayment Act, a borrower
who was repaying a loan under the Pay As You Earn Repayment
Plan, as described in clause (i), and changes to a different
repayment plan may not re-enroll in the Pay As You Earn
Repayment Plan.
“(B) Income contingent repayment plan.—
“(i) In general.—A borrower may choose the ICR plan, as
described in section 685.209 of title 34, Code of Federal
Regulations (as in effect on January 19, 2025), as an income
contingent repayment plan pursuant to paragraph (1)(D)—
“(I) before the date that is 2 years after the date of
enactment of the Savings Opportunity and Affordable Repayment
Act, only if the borrower has loans eligible for repayment
under such plan, as described in such section as in effect on
such date, except as provided in clause (iii); and
“(II) on or after the date that is 2 years after the date
of enactment of the Savings Opportunity and Affordable
Repayment Act, only if the borrower has loans eligible for
repayment under such plan, as described in such section as in
effect on such date, except as provided in clause (iii), and
was repaying a loan under such plan before such date that is
2 years after the date of enactment of the Savings
Opportunity and Affordable Repayment Act.
“(ii) Prohibition against re-enrollment.—Beginning on the
date that is 2 years after the date of enactment of the
Savings Opportunity and Affordable Repayment Act, a borrower
who was repaying a loan under the ICR plan, as described in
clause (i), and changes to a different repayment plan may not
re-enroll in the ICR plan.
“(iii) Eligible loans for purposes of icr repayment.—In
addition to the loans eligible for repayment under the ICR
plan as described in section 685.209 of title 34, Code of
Federal Regulations (as in effect on January 19, 2025), an
eligible loan for purposes of repayment under the ICR plan
may include—
“(I) a Federal Direct PLUS Loan made on behalf of a
dependent student;
“(II) a Federal Direct Consolidation Loan for which the
proceeds were used to discharge the liability on a Federal
Direct PLUS Loan or a loan under section 428B made on behalf
of a dependent student;
“(III) a loan under section 428B made on behalf of a
dependent student; or
“(IV) a loan under section 428C for which the proceeds
were used to discharge the liability on a Federal Direct PLUS
Loan or a loan under section 428B made on behalf of a
dependent student.”;
(4) by inserting after section 493D the following:
“SEC. 493E. SAVINGS OPPORTUNITY AND AFFORDABLE REPAYMENT
PLAN.
“(a) Definitions.—In this section:
“(1) Eligible loan.— The term `eligible loan' means a
loan made, insured, or guaranteed under part B or D.
“(2) Monthly payment obligation.—
“(A) In general.—The term `monthly payment obligation',
when used with respect to a borrower, means that for such
borrower the monthly payment amount due on the total amount
of eligible loans made to such borrower that is equal to,
except as provided in subparagraph (B)—
“(i) $0 for the portion of the borrower's, and the
borrower's spouse's (if applicable), adjusted gross income
(as defined in section 62 of the Internal Revenue Code of
1986) that is less than or equal to 250 percent of the
poverty line applicable to the borrower's family size as
determined under section 673(2) of the Community Services
Block Grant Act (42 U.S.C. 9902(2)); plus
“(ii) 5 percent of the portion of the borrower's, and the
borrower's spouse's (if applicable), adjusted gross income
(as defined in section 62 of the Internal Revenue Code of
1986) that is greater than 250 percent of the poverty line
applicable to the borrower's family size as determined under
section 673(2) of the Community Services Block Grant Act (42
U.S.C. 9902(2)), prorated by the percentage that is the
result of dividing the borrower's original total loan balance
attributable to eligible loans received for the borrower's
undergraduate study by the original total loan balance
attributable to all eligible loans, divided by 12; plus
“(iii) for loans not subject to clause (ii), 10 percent of
the portion of the borrower's, and the borrower's spouse's
(if applicable), adjusted gross income (as defined in section
62 of the Internal Revenue Code of 1986) that is greater than
250 percent of the poverty line applicable to the borrower's
family size as determined under section 673(2) of the
Community Services Block Grant Act (42 U.S.C. 9902(2)),
prorated by the percentage that is the result of dividing the
borrower's original total loan balance minus the original
total loan balance of loans subject to clause (ii) by the
borrower's original total loan balance attributable to all
eligible loans, divided by 12.
“(B) Minimal payment obligation.—If the calculation of
the monthly payment amount due under subparagraph (A) for a
borrower is—
“(i) less than $5, then the monthly payment obligation for
such borrower is equal to $0; and
“(ii) equal to or greater than $5 but less than $10, then
the monthly payment obligation for such borrower is equal to
$10.
“(b) Savings Opportunity and Affordable Repayment
Authorized.—Notwithstanding any other provision of this Act,
the Secretary shall carry out a Savings Opportunity and
Affordable Repayment plan program that complies with the
following:
“(1) A borrower of any eligible loan may elect to have the
borrower's aggregate monthly payment for all such loans not
exceed the monthly payment obligation of such borrower.
“(2) The holder of such eligible loan shall apply—
“(A) 50 percent of the borrower's monthly payment under
this subsection toward outstanding principal; and
“(B) 50 percent of the borrower's monthly payment under
this subsection—
“(i) first toward accrued charges and collection costs on
the loan;
“(ii) then toward outstanding interest; and
“(iii) then toward outstanding principal.
“(3) During all periods of repayment on all loans being
repaid under the Savings Opportunity and Affordable Repayment
plan, the Secretary shall not charge the borrower's account
any accrued interest that is not covered by the borrower's
monthly payment obligation.
“(4) Any principal due and not paid under paragraph (2)
shall be deferred.
“(5) In the case of a borrower repaying under the Savings
Opportunity and Affordable Repayment plan, the Secretary
shall cancel the remaining balance due on all eligible loans
for a borrower in the case the borrower—
“(A) is repaying only eligible loans received for
undergraduate study, or a consolidation loan that repaid only
loans received for such study, for which the borrower's
attendance in such undergraduate study was not more than 2
years, after the borrower has satisfied 120 monthly payments
or the equivalent (as described in paragraph (6)), over a
period of at least 10 years; and
“(B) is repaying at least one eligible loan not described
in subparagraph (A), after the borrower has satisfied 180
monthly payments or the equivalent (as described in paragraph
(6)), over a period of at least 15 years.
“(6) A monthly payment or the equivalent shall be
satisfied by any of the following:
“(A) A month in which the borrower—
“(i) makes a monthly payment that is equal to not less
than the monthly payment obligation of the borrower; or
“(ii) has a monthly payment obligation of $0.
“(B) A month in which the borrower receives a deferment or
forbearance of repayment under any of the following:
“(i) A cancer treatment deferment under section 455(f)(3).
“(ii) A rehabilitation training program deferment.
“(iii) An unemployment deferment.
“(iv) An economic hardship deferment, which includes
volunteer service in the Peace Corps as an economic hardship
condition.
“(v) A military service deferment.
“(vi) A post active-duty student deferment.
“(vii) A national service forbearance.
“(viii) A national guard duty forbearance.
“(ix) A Department of Defense Student Loan Repayment
forbearance.
“(x) An administrative forbearance under a period—
“(I) during which the Secretary has authorized forbearance
due to a national military mobilization or other local or
national emergency;
“(II) necessary for the Secretary to collect and process
documentation supporting the borrower's request for a
deferment, forbearance, change in repayment plan, or
consolidation loan; or
“(III) determined necessary by the Secretary.
“(xi) A bankruptcy forbearance if the borrower made the
required payments on a confirmed bankruptcy plan.
“(C) A month in which the borrower receives a deferment or
forbearance of repayment not described in subparagraph (B),
but for which the borrower makes an additional payment equal
to or greater than their monthly payment obligation
(including a monthly payment obligation of $0), for a
deferment or forbearance that ended within 3 years of the
date of such additional payment and occurred on or after the
date that is 180 days after the date of enactment of the
Savings Opportunity and Affordable Repayment Act.
“(D) A month in which the borrower—
“(i) makes a payment pursuant to a repayment plan under
section 493C or section 455(d)(1)(E), or another income
continent repayment plan under section 455(d)(1)(D), or had a
monthly payment obligation under such a plan of $0;
“(ii) makes a payment under the standard repayment plan,
as described in section 428(b)(9)(A)(i); or
“(iii) makes a payment under a repayment plan with
payments that are as least as much as they would have been
under the standard repayment plan, as described in section
428(b)(9)(A)(i).
“(7) A borrower who is repaying an eligible loan pursuant
to this section may elect, at any time, to terminate
repayment pursuant to this section and repay such loan under
any other repayment plan for which the borrower is eligible.
“(8) A borrower who is repaying an eligible loan pursuant
to this section may—
“(A) pay in multiple installments that equal the full
scheduled monthly payment obligation of such borrower; or
“(B) pay a lump sum or monthly payment amount that is
equal to or greater than the full scheduled monthly payment
obligation of such borrower in advance of the borrower's
scheduled payment due date for a period of months not to
exceed the period from the Secretary's receipt of the payment
until the borrower's next annual repayment plan
recertification date.
“(c) Eligibility Determinations.—
“(1) In general.—The Secretary shall establish procedures
for annually determining the borrower's eligibility for
repayment under this section, including verification of a
borrower's annual income and the annual amount due on the
total amount of eligible
loans, and such other procedures as are necessary to
effectively implement repayment under this section.
“(2) Procedures for eligibility.—The Secretary shall—
“(A) consider, but is not limited to, the procedures
established in accordance with section 455(e)(1); and
“(B) carry out, with respect to borrowers of any eligible
loan, procedures for repayment plans that are equivalent to
the procedures carried out under section 455(e)(8) with
respect to other income contingent repayment plans.
“(3) Failure to timely certify information.—If the
Secretary requires information from the borrower to
recalculate the borrower's monthly payment obligation under
this section, and the borrower does not provide the necessary
documentation to the Secretary by the time the Secretary
requires such documentation, the Secretary shall remove the
borrower from the Savings Opportunity and Affordable
Repayment plan under this section and place the borrower on
an alternative repayment plan under which the borrower's
required monthly payment is the amount the borrower would
have paid on a 10-year standard repayment plan based on the
current eligible loan balances and interest rates on the
eligible loans at the time the borrower is removed from the
plan under this section.
“(4) Procedures.—
“(A) Approval for the disclosure of tax information.—A
borrower shall provide approval for the disclosure of
applicable tax information to the Secretary to initially
enter repayment, or recertify the borrower's intent to repay,
under this section either as part of the process of
completing a Direct Loan Master Promissory Note or a Direct
Consolidation Loan Application and Promissory Note in
accordance with sections 455(e)(8) and 493C(c)(2) or on an
application form approved by the Secretary.
“(B) Failure to provide approval.—If a borrower does not
provide approval for the disclosure of applicable tax
information pursuant to subparagraph (A), the borrower shall
provide documentation of the borrower's income and family
size to the Secretary.
“(C) Inability to obtain information from the irs.—If the
Secretary has received approval for disclosure of applicable
tax information pursuant to subparagraph (A), but cannot
obtain the borrower's income and family size from the
Internal Revenue Service, the borrower and, if applicable,
the borrower's spouse, shall provide documentation of income
and family size to the Secretary.
“(D) Calculation of payment amount.—After the Secretary
obtains sufficient information to calculate the borrower's
monthly payment obligation, the Secretary shall—
“(i) calculate the borrower's monthly payment obligation;
and
“(ii) establish the 12-month period during which the
borrower will be obligated to make payments in the amount of
the monthly payment obligation.
“(E) Repayment disclosure.—The Secretary shall send to
each borrower a repayment disclosure that—
“(i) specifies the borrower's calculated monthly payment
obligation;
“(ii) explains how the payment was calculated;
“(iii) informs the borrower of the terms and conditions of
repayment under this section; and
“(iv) informs the borrower of how to contact the Secretary
if the calculated monthly payment obligation amount is not
reflective of the borrower's current income or family size.
“(F) Request for recalculation.—
“(i) In general.—If a borrower believes that the
calculated monthly payment obligation amount is not
reflective of the borrower's current income or family size,
the borrower may request that the Secretary recalculate the
monthly payment obligation amount.
“(ii) Alternative documentation.—To support a request
under clause (i), the borrower shall submit alternative
documentation of income or family size not based on tax
information to account for circumstances such as a decrease
in income since the borrower last filed a tax return, the
borrower's separation from a spouse with whom the borrower
had previously filed a joint tax return, the birth or
impending birth of a child, or other comparable
circumstances.
“(G) Forbearance.—If a borrower provides alternative
documentation under subparagraph (F) or if the Secretary
receives documentation from the borrower or the borrower's
spouse under subparagraph (C), the Secretary shall grant
forbearance to provide time for the Secretary to recalculate
the borrower's monthly payment obligation based on the
documentation.
“(H) 3 monthly payments remaining.—Once a borrower has 3
monthly payments remaining under a 12-month period specified
under subparagraph (D), the Secretary shall follow the
procedures described in subparagraphs (C) through (G).
“(I) Resetting of 12-month period.—At any point during a
12-month period specified under subparagraph (D), a borrower
may request that the Secretary recalculate the borrower's
monthly payment obligation earlier than would have otherwise
been the case to account for a change in the borrower's
circumstances, such as a loss of income or employment or
divorce. In such a case, the 12-month period specified under
subparagraph (D) shall be reset based on the borrower's new
information.
“(J) Tracking forgiveness.—The Secretary shall track a
borrower's progress toward eligibility for loan cancellation
under subsection (b)(5) and cancel loans that meet the
criteria under such subsection without the need for an
application or documentation from the borrower.
“(d) Married Borrowers.—
“(1) Calculation based solely on borrower's information.—
In the case of a married borrower, the Secretary shall
calculate the amount of the borrower's monthly payment
obligation under this section solely on the basis of the
borrower's eligible loan debt and adjusted gross income (as
defined in section 62 of the Internal Revenue Code of 1986)
if—
“(A) the borrower files a separate Federal income tax
return; or
“(B) the borrower files a joint Federal income tax return
and certifies that the borrower is currently separated from
the borrower's spouse or is currently unable to reasonably
access the spouse's income.
“(2) Calculation including spouse's information.—In the
case of a married borrower not described in subparagraph (A)
or (B), the Secretary shall—
“(A) include the spouse's income in the calculation of the
borrower's monthly payment obligation under this section; and
“(B) if the spouse has eligible loan debt, adjust the
borrower's monthly payment obligation under this section by—
“(i) dividing the outstanding principal and interest
balance of the borrower's eligible loans by the couple's
combined outstanding principal and interest balance on
eligible loans; and
“(ii) multiplying the borrower's payment amount as
calculated under subsection (a)(5) by the percentage
determined under clause (i).”; and
(5) in section 494(a)(2)(A)—
(A) in the matter preceding clause (i), by inserting “or a
Savings Opportunity and Affordable Repayment plan for a loan
under part B” after “part D”; and
(B) in clause (ii)(I), by inserting “or section
493E(c)(2)(B)” after “section 493C(c)(2)(B)”.