No federal or regional court has published cases in which the treatment of ISAs is analyzed under government or federal credit laws. But federal regulators seem to be aware of this problem. In a December 2019 discussion paper by the Federal Reserve Bank of Philadelphia on ISAs, the authors acknowledged the uncertainty created by the lack of relevant statements from the courts and supervisory authorities, but which did not introduce legal issues. The ability of borrowers to forego payments when their income is below a given point is considered a benefit. But this could be “oversold,” she added, since some contracts stick to the missed months until the end; However, a maximum payment period is customary. As the cost of university remains unattainable for many students, schools and startups are beginning to think about new ways to finance the cost of teaching. Income participation agreements (ESIs) are a method that attracts the attention of investors and training providers. Mandell agrees. “If you try to create a fair set of terms for different fields of study, the conditions of the ISA may vary by field of study, because the expected income will vary by field of study,” he said. The public debate on the Oregon plan has sparked renewed interest in equity-based funding models, including a major summit on The New America Foundation`s revenue engagement agreements and a strategy paper from the American Enterprise Institute. On April 9, 2014, Senator Marco Rubio announced the introduction of legislation in the U.S.
Congress that would “expand” the use of income participation agreements.   [must be updated] Regardless of the details, the structure of the Revenue Sharing Agreement (ISA) is relatively consistent. To define it more explicitly, an income-sharing agreement funds a student`s education in advance in exchange for obtaining a percentage of the student`s future income (i.e. “income sharing”) based on a predefined formula. In this way, the funder may be seen less as a debt investor than as an equity investor who receives “dividends” from future student earnings.