By: Bettencourt S.B. No. 2048
(Morrison)
A BILL TO BE ENTITLED
AN ACT
relating to the student loan program administered by the Texas
Higher Education Coordinating Board and to the repeal of a related
bond program.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Sections 52.11(c), (d), (h), (k), and (n),
Education Code, are amended to read as follows:
(c) The proceeds from the sale of bonds shall be placed in
the student loan auxiliary fund [Texas Opportunity Plan Fund].
(d) To assure the orderly and economical marketing of the
bonds and the reasonable availability of money in the student loan
auxiliary fund [Texas Opportunity Plan Fund], the bonds may be
issued in installments.
(h) The bonds shall be executed on behalf of the
coordinating board, or its successor, as general obligations of the
State of Texas [in the following manner: They shall be signed by
the chairman or vice chairman and the secretary of the board, and
the seal of the board shall be impressed on them. They shall be
signed by the governor and attested by the secretary of state and
the state seal impressed on them. The resolution authorizing the
issuance of any installment or series of bonds may prescribe the
extent to which facsimile signatures and facsimile seals may be
used in executing the bonds and appurtenant coupons. Interest
coupons may be signed with the facsimile signatures of the chairman
or vice chairman and the secretary of the board. In the event any
officer whose manual or facsimile signature appears on any bond or
coupon ceases to hold that office before the delivery of the bond or
coupon, the signature will nevertheless be valid and sufficient for
all purposes as if he had remained in office until the delivery had
been made].
(k) The performance of official duties prescribed by
Sections 50b-4, 50b-5, 50b-6, and 50b-7, Article III, [Section 50b,
of the] Texas Constitution, in reference to the provision for the
payment and the payment of the bonds may be enforced in any court of
competent jurisdiction through mandamus or other appropriate
proceedings.
(n) This section applies only to bonds issued under Sections
50b-4, 50b-5, 50b-6, and 50b-7, Article III, [Section 50b, of the]
Texas Constitution.
SECTION 2. Section 52.16, Education Code, is amended to
read as follows:
Sec. 52.16. PROCEEDS FROM BOND SALE. All proceeds from the
sale of bonds authorized by Sections 50b-4, 50b-5, 50b-6, and
50b-7, Article III, [Section 50b, 50b-1, or 50b-2 of the] Texas
Constitution, shall be deposited in the state treasury in the
student loan auxiliary fund [Texas Opportunity Plan Fund].
SECTION 3. Section 52.32(a), Education Code, is amended to
read as follows:
(a) The board may authorize loans from the Texas Opportunity
Plan Fund or the student loan auxiliary fund to a qualified
applicant who:
(1) is a resident of this state as defined by the board
in accordance with Subchapter B, Chapter 54;
(2) has been accepted for enrollment at a
participating higher educational institution[, provided that if
the institution is a public or private postsecondary educational
institution, the institution must be approved by an agency of the
United States government for the purpose of guaranteeing the maker
of such loans against loss due to the death, disability, or default
of the borrower];
(3) has established that the student has insufficient
resources to finance the student's college education or alternative
educator certification program;
(4) has submitted to the board at least two
references, including the names of the persons giving those
references and appropriate contact information for those persons;
and
(5) has complied with other requirements established
by the rules adopted by the board in conformity with this chapter.
SECTION 4. Section 52.33, Education Code, is amended to
read as follows:
Sec. 52.33. AMOUNT OF LOAN. The amount of the loan to any
qualified applicant shall be limited to the difference between the
financial resources available to the applicant, including [but not
limited to] the applicant's [income from parents and other
sources,] scholarships, gifts, grants, and other financial aid,
[and the amount the applicant can reasonably be expected to earn,]
and the amount necessary to pay the applicant's reasonable expenses
as a student at the participating institution of higher education
where the applicant has been accepted for enrollment, under the
rules and regulations adopted by the board. The total loan to any
individual student may never be more than the amount the student can
reasonably be expected to repay in the maximum loan period provided
by board rule, except as otherwise provided for in this chapter.
SECTION 5. Sections 52.34(a) and (f), Education Code, are
amended to read as follows:
(a) No payment may be made to any student until the student
has executed a note payable to the Texas Opportunity Plan Fund or
the student loan auxiliary fund for the full amount of the
authorized loan plus interest.
(f) The board shall distribute money to a participating
institution through the current statewide accounting system
[electronic funds transfer system maintained by the Texas
Guaranteed Student Loan Corporation for disbursing loan funds from
commercial lenders participating in the guaranteed student loan
program under Chapter 57, except that at the request of a
participating institution the board may distribute the money
through other means. The board shall enter into a contract with the
corporation for the use of the system, and the corporation shall
make the system available to the board as necessary to carry out
this subsection].
SECTION 6. Section 52.38, Education Code, is amended to
read as follows:
Sec. 52.38. REPAYMENT OF LOANS. Repayment of any loan and
interest authorized under this chapter shall be made monthly and
shall begin not later than nine months after the date the student
borrower is last enrolled in a participating institution or any
other institution of higher education [and in no event later than
five years from the date the first note evidencing a loan under this
chapter is executed]. The board may, however, authorize a longer
period before beginning repayment of loans to medical students,
dental students, and other students seeking professional or
graduate degrees. The board may extend the time for beginning
repayment for unusual financial hardships, with the approval of the
attorney general. Repayment shall be made directly to the board [or
to a participating institution] pursuant to a contract executed by
the board in accordance with its rules and regulations.
SECTION 7. The heading to Section 52.41, Education Code, is
amended to read as follows:
Sec. 52.41. SERVICING [RESTRICTION ON ISSUANCE] OF CERTAIN
FEDERALLY INSURED STUDENT LOANS.
SECTION 8. Section 52.41(b), Education Code, is amended to
read as follows:
(b) The board may service any outstanding student loans
issued by the board under the Federal Family Education Loan Program
authorized under Part B, Title IV, of the Higher Education Act of
1965 (20 U.S.C. Section 1071 et seq.).
SECTION 9. Section 52.53, Education Code, is amended to
read as follows:
Sec. 52.53. GIFTS AND GRANTS. The board may accept gifts,
grants, or donations of real or personal property from any
individual, group, association, or corporation or the United
States, subject to limitations or conditions set by law. The board
shall deposit gifts, grants, or donations of money [in the Texas
Opportunity Plan Fund or] in the student loan auxiliary fund and
shall separately account for and expend the funds in accordance
with the specific purpose for which given and under such conditions
as are imposed by the donor and as provided by law.
SECTION 10. Section 52.541(a), Education Code, is amended
to read as follows:
(a) The board shall establish separate accounting within
the Texas Opportunity Plan Fund and the student loan auxiliary fund
for each of its existing loan programs[, including accounting for
the federally insured loans that are insured by the United States
Department of Education, the federally insured loans that are
insured by the United States Department of Health and Human
Services, and each loan program that consists of loans insured by
the State of Texas].
SECTION 11. The following provisions of the Education Code
are repealed:
(1) Sections 52.32(a-1) and (b);
(2) Section 52.40;
(3) Sections 52.41(a) and (c); and
(4) Subchapter E, Chapter 52.
SECTION 12. This Act takes effect September 1, 2017.