article: SECTION 1. SHORT TITLE. This Act may be cited as the ``Tribal Colleges and Universities Faculty Loan Forgiveness Act''. SEC. 2. LOAN REPAYMENT OR CANCELLATION FOR INDIVIDUALS WHO TEACH IN TRIBAL COLLEGES OR UNIVERSITIES. (a) Perkins Loans.-- (1) Amendment.--Section 465(a) of the Higher Education Act of 1965 (20 U.S.C. 1087ee(a)) is amended-- (A) in paragraph (2)-- (i) in subparagraph (H), by striking ``or'' after the semicolon; (ii) in subparagraph (I), by striking the period and inserting ``; or''; and (iii) by adding at the end the following: ``(J) as a full-time faculty member at a Tribal College or University as defined in section 316(b).''; and (B) in paragraph (3)(A)(i), by striking ``or (I)'' and inserting ``(I), or (J)''. (2) Effective date.--The amendments made by paragraph (1) shall be effective for service performed during academic year 2005-2006 and succeeding academic years, notwithstanding any contrary provision of the promissory note under which a loan under part E of title IV of the Higher Education Act of 1965 (20 U.S.C. 1087aa et seq.) was made. (b) FFEL and Direct Loans.--Part G of title IV of the Higher Education Act of 1965 (20 U.S.C. 1088 et seq.) is amended by adding at the end the following: ``SEC. 493C. LOAN REPAYMENT OR CANCELLATION FOR INDIVIDUALS WHO TEACH IN TRIBAL COLLEGES OR UNIVERSITIES. ``(a) Program Authorized.--The Secretary shall carry out a program, through the holder of a loan, of assuming or canceling the obligation to repay a qualified loan amount, in accordance with subsection (b), for any new borrower on or after the date of enactment of the Tribal Colleges and Universities Faculty Loan Forgiveness Act, who-- ``(1) has been employed as a full-time faculty member at a Tribal College or University as defined in section 316(b); and ``(2) is not in default on a loan for which the borrower seeks repayment or cancellation. ``(b) Qualified Loan Amounts.-- ``(1) Percentages.--Subject to paragraph (2), the Secretary shall assume or cancel the obligation to repay under this section-- ``(A) 15 percent of the amount of all loans made, insured, or guaranteed after the date of enactment of the Tribal Colleges and Universities Faculty Loan Forgiveness Act to a student under part B or D, for the first or second year of employment described in subsection (a)(1); ``(B) 20 percent of such total amount, for the third or fourth year of such employment; and ``(C) 30 percent of such total amount, for the fifth year of such employment. ``(2) Maximum.--The Secretary shall not repay or cancel under this section more than $15,000 in the aggregate of loans made, insured, or guaranteed under parts B and D for any student. ``(3) Treatment of consolidation loans.--A loan amount for a loan made under section 428C 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 loan made, insured, or guaranteed under part B or D for a borrower who meets the requirements of subsection (a), as determined in accordance with regulations prescribed by the Secretary. ``(c) Regulations.--The Secretary is authorized to issue such regulations as may be necessary to carry out the provisions of this section. ``(d) Effect on Section.--Nothing in this section shall be construed to authorize any refunding of any repayment of a loan. ``(e) Prevention of Double Benefits.--No borrower may, for the same 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.). ``(f) Definition.--For purposes of this section, the term `year', when applied to employment as a faculty member, means an academic year as defined by the Secretary.''. SEC. 3. LOAN REPAYMENT FOR NURSING INSTRUCTORS AT TRIBAL COLLEGES OR UNIVERSITIES. Section 846(a)(3) of the Public Health Service Act (42 U.S.C. 297n(a)(3)) is amended-- (1) by striking ``(3)'' and inserting ``(3)(A)''; (2) by inserting ``or'' after the semicolon; and (3) by adding at the end the following: ``(B) who is a nursing instructor at a tribally controlled college or university (as such term is defined in section 2 of the Tribally Controlled College or University Assistance Act of 1978 (25 U.S.C. 1801), or any institution listed in section 532 of the Equity in Educational Land-Grant Status Act of 1994 (7 U.S.C. 301 note));''. SEC. 4. AMOUNTS FORGIVEN NOT TREATED AS GROSS INCOME. The amount of any loan that is assumed or canceled under an amendment made by this Act shall not, consistent with section 108(f) of the Internal Revenue Code of 1986, be treated as gross income for Federal income tax purposes.
summary: Tribal Colleges and Universities Faculty Loan Forgiveness Act - Amends the Higher Education Act of 1965 to provide for the cancellation of a specified percentage of the total amount of any Federal Perkins loan, Federal Family Education loan, or direct student loan for each year of employment (up to five) as a full-time faculty member at a tribal college or university if the borrower is not in default on such loan. Requires the Secretary to assume or cancel the obligation to repay: (1) 15% of the amount of all such loans made, insured, or guaranteed after enactment of this Act to a student for the first or second year of employment; (2) 20% for the third or fourth year of such employment; and (3) 30% for the fifth year. Limits the total amount of loan repayment or cancellation per student to $15,000. Allows for repayment or cancellation of consolidation loans only to the extent of the qualified student loans involved. Prohibits a borrower from receiving, for the same service, both a benefit from this Act and a benefit from the National Community Service Act of 1990. Amends the Public Health Service Act to provide for repayment by the Secretary of Health and Human Services of educational loans for nurse training costs on behalf of nursing instructors at tribal colleges or universities, or any land-grant institution listed in the Equity in Educational Land-Grant Status Act of 1994. Provides that the amount of any loan forgiven under this Act shall not be treated as gross income for federal tax purposes.