Student success fund

Part J of title IV of the Higher Education Act of 1965 (20 U.S.C. 1070 et seq.), as added by section 101, is further amended by adding at the end the following: 2 Student success fund 499I. In general (a) In general From amounts appropriated under section 499O for any fiscal year, the Secretary shall carry out a grant program (to be known as the Student Success Fund) to make grants to eligible entities to carry out the activities and services described in section 499L. (b) Priority In awarding funds under this subpart, the Secretary shall give priority to eligible entities that propose to use a significant share of grant funds to improve enrollment, retention, transfer, or completion rates or labor market outcomes among students of color, low-income students, students with disabilities, students in need of remediation, first generation college students, student parents, and other underserved student populations. 499J. Federal share and matching funds (a) Federal share (1) Formula requirements The Federal share of a grant under this subpart shall be based on a formula, developed by the Secretary, that accounts for— (A) the State or Tribal College or University relative share of eligible students, as determined in accordance with section 499B(c); (B) the State or Tribal College or University relative share of Federal Pell Grant recipients; and (C) the ratio between a State or Tribal College or University funding per full-time equivalent (FTE) student at public institutions of higher education and the average net price at public 4-year institutions of higher education, in such a way as to reward States and Indian tribes that keep net prices for students low while maintaining their fiscal support for higher education. (2) Formula published before application deadline The Secretary shall— (A) develop the formula described in paragraph (1); (B) calculate estimated allotments for each eligible entity under such formula; and (C) publish such formula and estimated allotments not later than the date of the notice soliciting applications for participation in the program under this subpart. (b) Matching funds (1) In general Except as provided in paragraph (2), an eligible entity participating in the program under this subpart shall provide, from non-Federal sources, in cash or in-kind— (A) in each of the first, second, third, and fourth years of participation in the program, an amount equal to 25 percent of the amount such entity received under subsection (a) with respect to such year; (B) in each of the fifth and sixth years of participation in the program, an amount equal to 50 percent of the amount such entity received under subsection (a) with respect to such year; (C) in each of the seventh and eighth years of participation in the program, an amount equal to 75 percent of the amount such entity received under subsection (a) with respect to such year; and (D) in the ninth year and each subsequent year thereafter of participation in the program, an amount equal to 100 percent of the amount such entity received under subsection (a) with respect to such year. (2) Exception for Tribal Colleges and Universities The Secretary may modify or waive the matching fund requirements under paragraph (1) in the case of an eligible entity that is a Tribal College or University. (3) Reallotment If an eligible entity returns to the Secretary any portion of the grant amount provided to such eligible entity under this subpart for any fiscal year, or requests a grant amount that is less than the Federal share determined for such entity in accordance with subsection (a), the Secretary shall reallot such excess amount for the succeeding fiscal year, in addition to the amounts appropriated under 499O for such succeeding fiscal year. (c) Supplement, not supplant Grant funds awarded under this subpart shall be used to supplement, and not supplant, other Federal, State, tribal, and local funds that would otherwise be expended to carry out activities assisted under this subpart. 499K. Applications (a) In general To be eligible to participate in the program under this subpart, an eligible entity shall submit an application to the Secretary at such time, in such manner, and containing such information as the Secretary may require, including— (1) a plan that includes— (A) the amount of funds requested by the eligible entity under this subpart and the intended use of such funds; (B) how the eligible entity will use the requested funds to implement promising and evidence-based institutional reforms and innovative practices to improve student outcomes, including— (i) implementation of the reforms and practices identified by such entity under section 499C(b)(4); and (ii) annual implementation benchmarks that the entity will use to track progress in implementing such reforms and practices; (C) if the eligible entity is a State, how such eligible entity will support the scaling of evidence-based and innovative initiatives system-wide; (D) how the eligible entity will meet its matching fund requirements under section 499J(b); (E) if the eligible entity is a State, how such eligible entity will prioritize spending on the public institutions of higher education specified in paragraph (2)(B); and (F) the improvements the eligible entity anticipates in student outcomes, including improvements in transfer rates or completion rates, or both; and (2) if the eligible entity is a State, an analysis that includes— (A) with respect to each public institution of higher education of the eligible entity— (i) the total per-student funding; (ii) the amount of per-student funding from State-appropriated funds; (iii) the student demographics (including data on race, income, disability status, and remediation); and (iv) transfer and completion rates, including such rates among low-income students, students of color, students with disabilities, and students in need of remediation; and (B) whether, of the public institutions of higher education of the eligible entity, the public institutions of higher education that received less funding on a per-student basis described in clause (i) or (ii), or both, of subparagraph (A), are serving disproportionately high shares of low-income students, students of color, students with disabilities, or students in need of remediation. (b) Approval (1) In general Not later than 180 days after receiving a plan under subsection (a), the Secretary shall— (A) approve the plan; or (B) require revisions to such plan. (2) Revisions required An eligible entity shall make such revisions as required by the Secretary under paragraph (1)(B). (c) Publication The Secretary shall make each plan approved under subsection (b)(1)(A) and each plan revised under subsection (b)(2) available to the public on the website of the Department. 499L. Program requirements (a) General requirements (1) Report on demonstrated progress For the third year in which an eligible entity participates in the program under this subpart, and every 2 years thereafter, the eligible entity shall submit a report to the Secretary, in such manner and containing such information as the Secretary may require, that includes— (A) the progress in meeting the annual implementation benchmarks included in the application of such eligible entity under section 499K(a)(1)(B); (B) the progress in improving the student outcomes identified by the entity under section 499K(a)(1)(F); and (C) with respect to the 2 years after such report is submitted— (i) a plan for the use of funds under this subpart; and (ii) the amount of funds requested by the eligible entity under this subpart. (2) Approval Not later than 180 days after receiving a plan under paragraph (1)(C)(i), the Secretary shall— (A) approve the plan; or (B) require revisions to such plan. (3) Revisions required An eligible entity shall make such revisions as required by the Secretary under paragraph (2)(B). (b) Failure To meet requirements If an eligible entity does not meet the annual implementation benchmarks included in the application of such eligible entity under section 499K(a)(1)(B), as required to be reported under subsection (a)(1)(A), such eligible entity shall submit to the Secretary, at such time and in such manner as the Secretary may require— (1) a written explanation for the delay in meeting such requirements; and (2) a plan that will enable such eligible entity to meet such requirements not later than 1 year after the date on which the eligible entity submitted the written explanation under paragraph (1). (c) Publication The Secretary shall make each plan approved under subsection (a)(2)(A), each plan revised under subsection (a)(3), and each plan submitted under subsection (b)(2) available to the public on the website of the Department. 499M. Allowable uses of funds (a) In general Except as provided in subsection (b), an eligible entity shall use a grant under this subpart only to carry out the plan approved or revised for such year under section 499K. (b) Use of funds for administrative purposes An eligible entity that receives a grant under this subpart may use not more than 5 percent of such grant for administrative purposes relating to the grant under this subpart. (c) Prohibited uses of funds No funds received under this section shall be used to— (1) pay contractors for the provision of pre-enrollment recruitment activities through a revenue sharing agreement; or (2) fund endowments, athletics, sectarian instruction, or religious worship. 499N. Eligible entity defined In this subpart, the term eligible entity means a State or Tribal College or University that is a recipient of a grant under subpart 1. 499O. Appropriations (a) Authorization and appropriations There are authorized to be appropriated, and there are appropriated to carry out this subpart (in addition to any other amounts appropriated to carry out this subpart and out of any money in the Treasury not otherwise appropriated), $1,000,000,000 for fiscal year 2027 and each succeeding fiscal year. (b) Availability Funds appropriated under subsection (a) shall remain available to the Secretary until expended..