Page:United States Statutes at Large Volume 106 Part 3.djvu/223

 PUBLIC LAW 102-408—OCT. 13, 1992 106 STAT. 2017 of the report submitted to the Secretary by the school under paragraph (6). "(4) NONCOMPLIANCE BY SCHOOL. — "(A)(i) Subject to subparagraph (C), each agreement under section 721 with a school of medicine or osteopathic medicine shall provide that, if the school fails to comply with paragraph (1) for a 1-year period under such paragraph, the school— "(I) will pay to the Secretary the amount applicable under subparagraph (B) for the period; and "(II) will pay such amount not later than 90 days aiter the school is informed under paragraph (3) of the determination of the Secretary regarding such period. "(ii) Any amount that a school is required to pay under clause (i) may be paid from the student loan fund of the school under section 721. "(B) For purposes of subparagraph (A), the amount applicable for a school, subject to subparagraph (C), is— "(i) for the 1-year period ending June 30, 1994, an amount equal to 10 percent of the income received during such period by the student loan fund of the school under section 721; "(ii) for the 1-year period ending June 30, 1995, an amount equal to 20 percent of the income received during such period by the student loan fund; and "(iii) for any subsequent 1-year period under paragraph (1), an amount equal to 30 percent of the income received during such period by the student loan fund. "(C) In determining the amount of income that a student loan fund has received for purposes of subparagraph (B), the Secretary shall exclude any income derived from exempt contributions. Payments made to the Secretary under subparagraph (A) may not be made with such contributions or with income derived from such contributions. "(5) EXPENDITURE OF PAYMENTS. — "(A) Amounts paid to the Secretary under paragraph (4) shall be expended to make Federal capital contributions to student loan funds under section 721 of schools that are in compliance with paragraph (1). "(B) A Federal capital contribution under section 721 may not be construed as being an exempt Federal capital contribution if the contribution is made from payments under subparagraph (A). A school contribution under such section may not be construed as being an exempt school contribution if the contribution is made pursuant to a Federal capital contribution from such payments. "(6) REPORTS BY SCHOOLS. —Each agreement under section 721 with a school of medicine or osteopathic medicine shall provide that the school will submit to the Secretary a report for each 1-year period under paragraph (1) that provides such information as the Secretary determines to be necessary for carrying out this subsection. Each such report shall include statistics concerning the current training or practice status of all graduates of such school whose date of graduation from

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