Texas 2017 - 85th Regular

Texas Senate Bill SB32 Compare Versions

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1	1	By: Zaffirini S.B. No. 32
2	2
3	3
4	4	A BILL TO BE ENTITLED
5	5	AN ACT
6	6	relating to the establishment and operation of the Texas B-On-time
7	7	student loan program.
8	8	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
9	9	SECTION 1. Chapter 56, Education Code, is amended by adding
10	10	Subchapter Q to read as follows:
11	11	SUBCHAPTER Q. TEXAS B-ON-TIME LOAN PROGRAM
12	12	Sec. 56.451. DEFINITIONS. In this subchapter:
13	13	(1) "Coordinating board" means the Texas Higher
14	14	Education Coordinating Board.
15	15	(2) "Eligible institution" means an institution of
16	16	higher education.
17	17	(3) "General academic teaching institution," "medical
18	18	and dental unit," and "public state college," have the meanings
19	19	assigned by Section 61.003.
20	20	Sec. 56.452. PROGRAM NAME; PURPOSE. (a) The student loan
21	21	program authorized by this subchapter is known as the Texas
22	22	B-On-time loan program, and an individual loan awarded under this
23	23	subchapter is known as a Texas B-On-time loan.
24	24	(b) The purpose of this subchapter is to provide no-interest
25	25	loans to eligible students to enable those students to earn
26	26	baccalaureate degrees at public institutions of higher education in
27	27	this state.
28	28	Sec. 56.453. ADMINISTRATION OF PROGRAM; RULES. (a) The
29	29	coordinating board shall:
30	30	(1) administer the Texas B-On-time loan program;
31	31	(2) determine the repayment and other terms of a Texas
32	32	B-On-time loan; and
33	33	(3) in consultation with the student financial aid
34	34	officers of eligible institutions, adopt any rules necessary to
35	35	implement the program or this subchapter.
36	36	(b) The coordinating board may charge and collect a loan
37	37	origination fee from a person who receives a Texas B-On-time loan to
38	38	be used by the board to pay for the operating expenses for making
39	39	loans under this subchapter.
40	40	(c) The total amount of Texas B-On-time loans awarded may
41	41	not exceed the amount available in the Texas B-On-time student loan
42	42	account under Section 56.463.
43	43	(d) The coordinating board, in collaboration with eligible
44	44	institutions and other appropriate entities, shall adopt and
45	45	implement measures to:
46	46	(1) improve student participation in the Texas
47	47	B-On-time loan program, including strategies to better inform
48	48	students and prospective students about the program; and
49	49	(2) improve the rate of student satisfaction of the
50	50	requirements for obtaining Texas B-On-time loan forgiveness.
51	51	(e) The coordinating board, in collaboration with eligible
52	52	institutions and appropriate nonprofit or college access
53	53	organizations, shall:
54	54	(1) educate students regarding the eligibility
55	55	requirements for forgiveness of Texas B-On-time loans;
56	56	(2) ensure that students applying for or receiving a
57	57	Texas B-On-time loan understand their responsibility to repay any
58	58	portion of the loan that is not forgiven;
59	59	(3) ensure that students who are required to repay
60	60	Texas B-On-time loans receive and understand information regarding
61	61	loan default prevention strategies; and
62	62	(4) through an in-person or online loan counseling
63	63	module, provide loan repayment and default prevention counseling to
64	64	students receiving Texas B-On-time loans.
65	65	(f) Notwithstanding Subsection (e)(4), the following
66	66	eligible institutions shall provide the loan repayment and default
67	67	prevention counseling described by that subdivision to all Texas
68	68	B-On-time loan recipients enrolled at those institutions:
69	69	(1) each institution with a Texas B-On-time loan
70	70	default rate that exceeds the statewide average default rate for
71	71	such loans; and
72	72	(2) each institution with a Texas B-On-time loan
73	73	forgiveness rate that is less than 50 percent of the statewide
74	74	average forgiveness rate for such loans.
75	75	Sec. 56.454. PERSONS NOT ELIGIBLE. (a) A person is not
76	76	eligible to receive a Texas B-On-time loan if the person has been
77	77	granted a baccalaureate degree.
78	78	(b) A person may not receive a Texas B-On-time loan for more
79	79	than 135 semester credit hours or the equivalent.
80	80	Sec. 56.455. INITIAL ELIGIBILITY FOR LOAN. To be eligible
81	81	initially for a Texas B-On-time loan, a person must:
82	82	(1) be a resident of this state under Section 54.052 or
83	83	be entitled, as a child of a member of the armed forces of the United
84	84	States, to pay tuition at the rate provided for residents of this
85	85	state under Section 54.241;
86	86	(2) meet one of the following academic requirements:
87	87	(A) be a graduate of a public or private high
88	88	school in this state who graduated not earlier than the 2016-2017
89	89	school year under the recommended or advanced high school program
90	90	established under Section 28.025(a) or its equivalent;
91	91	(B) be a graduate of a high school operated by the
92	92	United States Department of Defense who:
93	93	(i) graduated from that school not earlier
94	94	than the 20016-2017 school year; and
95	95	(ii) at the time of graduation from that
96	96	school was a dependent child of a member of the armed forces of the
97	97	United States; or
98	98	(C) have received an associate degree from an
99	99	institution of higher education or private or independent
100	100	institution of higher education not earlier than May 1, 2019;
101	101	(3) be enrolled for a full course load for an
102	102	undergraduate student, as determined by the coordinating board, in
103	103	a baccalaureate degree program at an eligible institution;
104	104	(4) be eligible for federal financial aid, except that
105	105	a person is not required to meet any financial need requirement
106	106	applicable to a particular federal financial aid program; and
107	107	(5) comply with any additional nonacademic
108	108	requirement adopted by the coordinating board under this
109	109	subchapter.
110	110	Sec. 56.456. CONTINUING ELIGIBILITY AND ACADEMIC
111	111	PERFORMANCE REQUIREMENTS. (a) After initially qualifying for a
112	112	Texas B-On-time loan, a person may continue to receive a Texas
113	113	B-On-time loan for each semester or term in which the person is
114	114	enrolled at an eligible institution only if the person:
115	115	(1) is enrolled for a full course load for an
116	116	undergraduate student, as determined by the coordinating board, in
117	117	a baccalaureate degree program at an eligible institution;
118	118	(2) is eligible for federal financial aid, except that
119	119	a person is not required to meet any financial need requirement
120	120	applicable to a particular federal financial aid program;
121	121	(3) makes satisfactory academic progress toward a
122	122	degree as determined by the institution at which the person is
123	123	enrolled, if the person is enrolled in the person's first academic
124	124	year at the institution;
125	125	(4) completed at least 75 percent of the semester
126	126	credit hours attempted by the person in the most recent academic
127	127	year and has a cumulative grade point average of at least 2.5 on a
128	128	four-point scale or the equivalent on all coursework previously
129	129	attempted at institutions of higher education, if the person is
130	130	enrolled in any academic year after the person's first academic
131	131	year; and
132	132	(5) complies with any additional nonacademic
133	133	requirement adopted by the coordinating board.
134	134	(b) If a person fails to meet any of the requirements of
135	135	Subsection (a) after the completion of any semester or term, the
136	136	person may not receive a Texas B-On-time loan for the next semester
137	137	or term in which the person enrolls. A person may become eligible
138	138	to receive a Texas B-On-time loan in a subsequent semester or term
139	139	if the person:
140	140	(1) completes a semester or term during which the
141	141	person is not eligible for a Texas B-On-time loan; and
142	142	(2) meets all of the requirements of Subsection (a).
143	143	(c) A person who is eligible to receive a Texas B-On-time
144	144	loan continues to remain eligible to receive the Texas B-On-time
145	145	loan if the person enrolls in or transfers to another eligible
146	146	institution.
147	147	Sec. 56.457. WAIVER OF COURSE LOAD REQUIREMENT. (a) The
148	148	coordinating board shall adopt rules to allow a person who is
149	149	otherwise eligible to receive a Texas B-On-time loan, in the event
150	150	of a hardship or other good cause, to receive a Texas B-On-time loan
151	151	while enrolled in a number of semester credit hours that is less
152	152	than the number of semester credit hours required under Section
153	153	56.455 or 56.456, as applicable.
154	154	(b) The coordinating board may not allow a person to receive
155	155	a Texas B-On-time loan while enrolled in fewer than six semester
156	156	credit hours.
157	157	Sec. 56.458. LOAN USE. A person receiving a Texas B-On-time
158	158	loan may use the money to pay for any usual and customary costs of
159	159	attendance at an eligible institution incurred by the student,
160	160	including tuition, fees, books, and room and board.
161	161	Sec. 56.459. LOAN AMOUNT. (a) The amount of a Texas
162	162	B-On-time loan for a semester or term for a student enrolled
163	163	full-time at an eligible institution is an amount determined by the
164	164	coordinating board as the average amount of tuition and required
165	165	fees that a resident student enrolled full-time in a baccalaureate
166	166	degree program would be charged for that semester or term at general
167	167	academic teaching institutions.
168	168	(b) Not later than January 31 of each year, the coordinating
169	169	board shall publish the amounts of each loan established by the
170	170	board for each type of institution for the academic year beginning
171	171	the next fall semester.
172	172	(c) If in any academic year the amount of money in the Texas
173	173	B-On-time student loan account is insufficient to provide the loans
174	174	to all eligible persons in amounts specified by this section, the
175	175	coordinating board shall determine the amount of available money
176	176	and shall allocate that amount to eligible students in the order the
177	177	students applied.
178	178	Sec. 56.460. NOTIFICATION OF PROGRAM; RESPONSIBILITIES OF
179	179	SCHOOL DISTRICTS. (a) The coordinating board, in consultation
180	180	with all eligible institutions, shall prepare materials designed to
181	181	inform prospective students, their parents, and high school
182	182	counselors about the program and eligibility for a Texas B-On-time
183	183	loan. The coordinating board shall distribute to each eligible
184	184	institution and to each school district a copy of the materials
185	185	prepared under this subchapter.
186	186	(b) Each school district shall notify its middle school
187	187	students, junior high school students, and high school students,
188	188	those students' teachers and school counselors, and those students'
189	189	parents or guardians of the Texas B-On-time loan program and the
190	190	eligibility requirements of the program.
191	191	Sec. 56.461. LOAN PAYMENT DEFERRED. The repayment of a
192	192	Texas B-On-time loan received by a student under this subchapter is
193	193	deferred as long as the student remains continuously enrolled in a
194	194	baccalaureate degree program at an eligible institution.
195	195	Sec. 56.462. LOAN FORGIVENESS. A student who receives a
196	196	Texas B-On-time loan shall be forgiven the amount of the student's
197	197	loan if the student is awarded a baccalaureate degree at an eligible
198	198	institution with a cumulative grade point average of at least 3.0 on
199	199	a four-point scale or the equivalent:
200	200	(1) within:
201	201	(A) four calendar years after the date the
202	202	student initially enrolled in an institution of higher education or
203	203	private or independent institution of higher education if the
204	204	student is awarded a degree other than a degree in engineering,
205	205	architecture, or any other program determined by the coordinating
206	206	board to require more than four years to complete; or
207	207	(B) five calendar years after the date the
208	208	student initially enrolled in an institution of higher education or
209	209	private or independent institution of higher education if the
210	210	student is awarded a degree in engineering, architecture, or any
211	211	other program determined by the coordinating board to require more
212	212	than four years to complete; or
213	213	(2) with a total number of semester credit hours,
214	214	including transfer credit hours and excluding hours earned
215	215	exclusively by examination, hours earned for a course for which the
216	216	student received credit toward the student's high school academic
217	217	requirements, and hours earned for developmental coursework that an
218	218	institution of higher education required the student to take under
219	219	Section 51.3062 or under the former provisions of Section 51.306,
220	220	that is not more than six hours more than the minimum number of
221	221	semester credit hours required to complete the degree.
222	222	Sec. 56.463. TEXAS B-ON-TIME STUDENT LOAN ACCOUNT. (a) The
223	223	Texas B-On-time student loan account is an account in the general
224	224	revenue fund. The account consists of gifts and grants and
225	225	legislative appropriations received under Section 56.464 and other
226	226	money required by law to be deposited in the account.
227	227	(b) Money in the Texas B-On-time student loan account may be
228	228	used only to pay any costs of the coordinating board related to the
229	229	operation of the Texas B-On-time loan program and as otherwise
230	230	provided by this subchapter.
231	231	Sec. 56.464. FUNDING. (a) The coordinating board may
232	232	solicit and accept gifts and grants from any public or private
233	233	source for the purposes of this subchapter.
234	234	(b) The coordinating board may issue and sell general
235	235	obligation bonds under Subchapter F, Chapter 52, for the purposes
236	236	of this subchapter.
237	237	(c) The legislature may appropriate money for the purposes
238	238	of this subchapter.
239	239	SECTION 2. Section 52.89, Education Code, is amended by
240	240	amending Subsection (c) and adding Subsection (c-1) to read as
241	241	follows:
242	242	(c) The board shall deposit to the credit of the fund any
243	243	proceeds from the sale of bonds, excluding:
244	244	(1) any accrued interest on the bonds which shall be
245	245	deposited in the board interest and sinking fund relating to the
246	246	bonds; and
247	247	(2) proceeds from the sale of bonds issued by the board
248	248	under Section 56.464(b) to provide Texas B-On-time student loans[as
249	249	that subsection existed immediately before September 1, 2015]]
250	250	(c-1) Notwithstanding Subsection (c), proceeds from the
251	251	sale of bonds issued by the board under Section 56.464(b) to provide
252	252	Texas B-On-time student loans may be deposited to the credit of the
253	253	fund by resolution of the board.
254	254	SECTION 3. Subchapter F, Chapter 52, Education Code, is
255	255	amended by amending Section 52.90 to read as follows:
256	256	Sec. 52.90. LOANS FROM FUND. (a) The board:
257	257	(1) shall make a loan from the fund to a student who
258	258	qualifies for a loan under Subchapter C; and
259	259	(2) may make a loan from the fund to a student who
260	260	qualifies for a Texas B-On-time student loan under Subchapter Q,
261	261	Chapter 56.
262	262	(b) Loans from the fund are governed by Subchapter C of this
263	263	chapter or Subchapter Q, Chapter 56, as appropriate, as if made
264	264	under that subchapter, except to the extent of conflict with this
265	265	subchapter.
266	266	SECTION 4. The heading to Section 52.91, Education Code, is
267	267	amended to read as follows:
268	268	Sec. 52.91. BONDS FOR [FORMER ]TEXAS B-ON-TIME STUDENT LOAN
269	269	PROGRAM.
270	270	SECTION 5. Section 52.91, Education Code, is amended by
271	271	amending Subsection (a), adding Subsection (b), and amending
272	272	Subsection (c) to read as follows:
273	273	(a) The board shall deposit to the credit of the Texas
274	274	B-On-time student loan account established under Section 56.0092 or
275	275	Section 56.463 any proceeds from the sale of bonds issued by the
276	276	board to fund Texas B-On-time student loans under Section
277	277	56.464(b),[as that subsection existed immediately before September
278	278	1, 2015,] other than:
279	279	(1) accrued interest on the bonds, which shall be
280	280	deposited to the credit of the interest and sinking fund related to
281	281	the bonds; and
282	282	(2) any proceeds from the sale of the bonds that the
283	283	board by resolution deposits to the student loan auxiliary fund
284	284	under Section 52.89(c-1).
285	285	(b) The board by resolution may establish as provided by
286	286	Section 52.03 one or more interest and sinking funds to be used for
287	287	any purpose relating to the Texas B-On-time student loan program
288	288	established under Subchapter Q, Chapter 56.
289	289	(c) The board shall repay bonds described by Subsection (a)
290	290	using proceeds from the bonds, legislative appropriations, and
291	291	money collected by the board as repayment for Texas B-On-time
292	292	student loans awarded by the board[ under Section 56.0092(c) for a
293	293	semester or term occurring before the 2020 fall semester]. The
294	294	board may also repay the bonds by using tuition set aside under
295	295	Section 56.465, as that section existed immediately before
296	296	September 1, 2015, for a semester or term occurring before the 2015
297	297	fall semester. The board may not repay the bonds with money
298	298	collected by the board as repayment for student loans awarded by the
299	299	board under Subchapter C to repay bonds issued by the board for the
300	300	Texas B-On-time student loan program under Section 56.464(b).
301	301	SECTION 6. (a) The Texas Higher Education Coordinating
302	302	Board and the eligible institutions shall award loans under the
303	303	Texas B-On-time student loan program established under Subchapter
304	304	Q, Chapter 56, Education Code, as added by this Act, beginning with
305	305	the 2017 fall semester.
306	306	(b) The Texas Higher Education Coordinating Board shall
307	307	adopt the initial rules for awarding loans under the Texas
308	308	B-On-time student loan program established under Subchapter Q,
309	309	Chapter 56, Education Code, as added by this Act, as soon as
310	310	practicable after the effective date of this Act. The coordinating
311	311	board may adopt those initial rules in the manner provided by law
312	312	for emergency rules.
313	313	SECTION 7. This Act takes effect immediately if it receives
314	314	a vote of two-thirds of all the members elected to each house, as
315	315	provided by Section 39, Article III, Texas Constitution. If this
316	316	Act does not receive the vote necessary for immediate effect, this
317	317	Act takes effect September 1, 2017.