BP BHEAD INT S [atlas:bill]

AN ACT Relating to a conditional scholarship for vocational-technical education; amending RCW 43.79A.040; adding a new chapter to Title 28B RCW; and making appropriations.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION. Sec. 1. INTENT. The legislature finds that the labor market demand by businesses in Washington for vocational-technical certificates is high and that there is a severe shortage in this state in the supply of individuals completing a postsecondary vocational-technical certificate or degree program. The legislature further finds that encouraging students to enroll in postsecondary vocational-technical degree or certificate programs in high-demand industrial sectors will benefit students, business and industry, and the economy as a whole. By creating a conditional scholarship program, the legislature intends to assist in the effort to recruit students to be trained for employment in high-demand industrial sectors.

NEW SECTION. Sec. 2. DEFINITIONS. Unless the context clearly requires otherwise, the definitions in this section apply throughout this chapter.

(1) "Conditional scholarship" means a loan that may be used for (a) the payment of tuition and services and activities fees; (b) the purchase of books and training supplies; and (c) transportation expenses; and that is forgiven in whole or in part if the recipient is employed in this state in the occupation or industrial sector in which the recipient was trained.

(2) "Board" means the higher education coordinating board.

(3) "Eligible student" means an individual who qualifies for enrollment in an eligible program.

(4) "Eligible program" means:

(a) A vocational-technical program offered through a community college, a technical college, or a licensed private career school that results in a certificate or degree; and

(b) A program that the work force training and education coordinating board determines constitutes an eligible program under section 6 of this act.

(5) "Participant" means an eligible student who has received a conditional scholarship under this chapter.

(6) "Satisfied" means paid-in-full.

NEW SECTION. Sec. 3. PROGRAM CREATED‑-POWERS AND DUTIES OF BOARD. The bright futures conditional scholarship program is established. The program shall be administered by the board. In administering the program, the board shall:

(1) Adopt selection criteria based on the date of application;

(2) Allocate conditional scholarship funds, awarding at least thirty percent of the scholarships to individuals that are either currently eligible to receive temporary assistance for needy families or were so eligible during the twenty-four months preceding their application for the scholarship;

(3) Adopt necessary rules and guidelines;

(4) Record the amount of loan forgiven for those students who meet their service obligations and collect and manage repayments from students who do not meet their service obligations under this chapter;

(5) Accept grants and donations from public and private sources for the program; and

(6) Ensure that the awarding of conditional scholarships to students under this program (a) results in a net increase in the number of vocational-technical students receiving financial aid; and (b) does not result in the loss of other federal or state financial and gift assistance to those students, to the extent allowable under federal and state student aid rules and regulations.

NEW SECTION. Sec. 4. DUTIES OF THE WORK FORCE TRAINING AND EDUCATION COORDINATING BOARD. The work force training and education coordinating board shall:

(1) Publicize and promote the scholarship program under this chapter;

(2) Solicit grants and donations from public and private sources for the program;

(3) Determine what constitutes an eligible program; and

(4) Determine what constitutes being employed in the occupation or industrial sector in which an individual was trained for purposes of the repayment obligation under section 8 of this act.

NEW SECTION. Sec. 5. DUTIES OF THE DEPARTMENT OF SOCIAL AND HEALTH SERVICES. The department of social and health services shall:

(1) Work with the work force training and education coordinating board to encourage recipients of temporary assistance for needy families to become participants in the scholarship program under this chapter; and

(2) Ensure that no department rule prevents recipients of temporary assistance for needy families from becoming participants in the scholarship program under this chapter.

NEW SECTION. Sec. 6. ELIGIBLE PROGRAM. (1) In making its determination of what constitutes an eligible program, the work force training and education coordinating board shall consider:

(a) Whether there is a significant industry or occupational gap between the supply of skilled workers and the demand for such workers within the occupation or industrial sector that the degree or certificate program prepares students to work in;

(b) The wage level likely to be earned by persons who complete the program; and

(2) In order to be an eligible program, there must be a contribution from the industry that benefits from students graduating from the degree or certificate program that equals or exceeds twenty-five percent of the scholarships awarded to individuals who enroll in the degree or certificate programs that prepare students to work in that occupation or industry.

(3) In determining what constitutes an eligible program, the work force training and education coordinating board shall consult with the state board for community and technical colleges for advice on which public certificate or degree programs prepare students for work in a given occupation or industry.

NEW SECTION. Sec. 7. AWARD‑-AMOUNT, DURATION. The board shall allocate funds for conditional scholarships to eligible students from the funds appropriated to the board for this purpose, or from any private donations, or any other funds given to the board for this program. The amount of the conditional scholarship awarded an individual shall not exceed an amount that is double the common tuition and service and activities fees charged at Washington state public community and technical colleges per academic year. Students are eligible to receive conditional scholarships for a maximum of two years and must complete using each award within five years of receipt.

NEW SECTION. Sec. 8. REPAYMENT OBLIGATION. (1) Participants in the conditional scholarship program incur an obligation to repay the conditional scholarship, with interest, unless they are employed in this state for two years in the occupation or industrial sector in which they were trained, for each year of scholarship received, under rules adopted by the board.

(2) The interest rate shall be eight percent for the length of the repayment period. The board shall establish the repayment period, with payments accruing quarterly commencing nine months from the date the participant completes or discontinues the eligible program. Payments shall be no less than one hundred fifty dollars per quarter.

(3) The entire principal and interest of each payment shall be forgiven for each payment period in which the participant is employed in this state in the occupation or industrial sector in which the participant was trained until either the entire repayment obligation is satisfied or the participant has been employed in this state in the occupation or industrial sector in which he or she was trained for eight payment periods for each year of receiving a scholarship under this chapter. Should the participant cease to be employed in this state in the occupation or industrial sector in which the participant was trained before the participant's repayment obligation is completed, payments on the unsatisfied portion of the principal and interest shall begin the next payment period and continue until the remainder of the participant's repayment obligation is satisfied.

(4) The board is responsible for collection of repayments made under this section and shall exercise due diligence in such collection, maintaining all necessary records to ensure that maximum repayments are made. Collection and servicing of repayments under this section shall be pursued using the full extent of the law, including wage garnishment if necessary. The board is responsible to forgive all or parts of such repayments under the criteria established in this section and shall maintain all necessary records of forgiven payments.

(5) Receipts from the payment of principal or interest or any other subsidies to which the board as administrator is entitled, which are paid by or on behalf of participants under this section, shall be deposited with the board and shall be used to cover the costs of granting the conditional scholarships, maintaining necessary records, and making collections under subsection (4) of this section. The board shall maintain accurate records of these costs, and all receipts beyond those necessary to pay such costs shall be used to grant conditional scholarships under this chapter.

NEW SECTION. Sec. 9. BRIGHT FUTURES CONDITIONAL SCHOLARSHIP ACCOUNT. (1) The bright futures conditional scholarship account is created in the custody of the state treasurer.

(2) All appropriations for the bright futures conditional scholarship program, private donations to the bright futures conditional scholarship program, and receipts from students' repayments must be deposited into the account.

(3) Expenditures from the account may be used only for conditional loans to students and the board's administrative costs associated with the awarding, tracking, and collection of the loans.

(4) With the exception of the operating costs associated with the management of the account by the treasurer's office as authorized in chapter 43.79A RCW, the account shall be credited with all investment income earned by the account. Only the director of the higher education coordinating board or the director's designee may authorize expenditures from the account.

(5) Disbursements from the account are exempt from appropriations and the allotment provisions of chapter 43.88 RCW, however money used for program administration is subject to the allotment and budgetary controls of chapter 43.88 RCW, and an appropriation is required for expenditures.

Sec. 10. RCW 43.79A.040 and 1998 c 268 s 1 are each amended to read as follows:

(1) Money in the treasurer's trust fund may be deposited, invested, and reinvested by the state treasurer in accordance with RCW 43.84.080 in the same manner and to the same extent as if the money were in the state treasury.

(2) All income received from investment of the treasurer's trust fund shall be set aside in an account in the treasury trust fund to be known as the investment income account.

(3) The investment income account may be utilized for the payment of purchased banking services on behalf of treasurer's trust funds including, but not limited to, depository, safekeeping, and disbursement functions for the state treasurer or affected state agencies. The investment income account is subject in all respects to chapter 43.88 RCW, but no appropriation is required for payments to financial institutions. Payments shall occur prior to distribution of earnings set forth in subsection (4) of this section.

(4)(a) Monthly, the state treasurer shall distribute the earnings credited to the investment income account to the state general fund except under (b) and (c) of this subsection.

(b) The following accounts and funds shall receive their proportionate share of earnings based upon each account's or fund's average daily balance for the period: The bright futures conditional scholarship account, the Washington advanced college tuition payment program account, the agricultural local fund, the American Indian scholarship endowment fund, the Washington international exchange scholarship endowment fund, the energy account, the fair fund, the game farm alternative account, the grain inspection revolving fund, the rural rehabilitation account, the stadium and exhibition center account, the youth athletic facility grant account, the self-insurance revolving fund, the sulfur dioxide abatement account, and the children's trust fund. However, the earnings to be distributed shall first be reduced by the allocation to the state treasurer's service fund pursuant to RCW 43.08.190.

(c) The following accounts and funds shall receive eighty percent of their proportionate share of earnings based upon each account's or fund's average daily balance for the period: The advanced right of way revolving fund, the advanced environmental mitigation revolving account, the federal narcotics asset forfeitures account, the high occupancy vehicle account, the local rail service assistance account, and the miscellaneous transportation programs account.

(5) In conformance with Article II, section 37 of the state Constitution, no trust accounts or funds shall be allocated earnings without the specific affirmative directive of this section.

NEW SECTION. Sec. 11. CAPTIONS NOT LAW. Captions used in this chapter are not any part of the law.

NEW SECTION. Sec. 12. Sections 1 through 9 and 11 of this act constitute a new chapter in Title 28B RCW.

NEW SECTION. Sec. 13. (1)(a) The sum of three million dollars, or as much thereof as may be necessary, is appropriated for the fiscal year ending June 30, 2000, from the general fund to the higher education coordinating board for the purposes of this act.

(b) The sum of seven million seven hundred fifty thousand dollars, or as much thereof as may be necessary, is appropriated for the fiscal year ending June 30, 2001, from the general fund to the higher education coordinating board for the purposes of this act.

(2)(a) The sum of seven million seven hundred fifty thousand dollars, or as much thereof as may be necessary, is appropriated for the fiscal year ending June 30, 2002, from the general fund to the higher education coordinating board for the purposes of this act.

(b) The sum of seven million seven hundred fifty thousand dollars, or as much thereof as may be necessary, is appropriated for the fiscal year ending June 30, 2003, from the general fund to the higher education coordinating board for the purposes of this act.

NEW SECTION. Sec. 14. (1)(a) The sum of one hundred twenty thousand dollars, or as much thereof as may be necessary, is appropriated for the fiscal year ending June 30, 2000, from the general fund to the work force training and education coordinating board for the purposes of section 4 of this act.

(b) The sum of sixty thousand dollars, or as much thereof as may be necessary, is appropriated for the fiscal year ending June 30, 2001, from the general fund to the work force training and education coordinating board for the purposes of section 4 of this act.

(2)(a) The sum of sixty thousand dollars, or as much thereof as may be necessary, is appropriated for the fiscal year ending June 30, 2002, from the general fund to the work force training and education coordinating board for the purposes of section 4 of this act.

(b) The sum of sixty thousand dollars, or as much thereof as may be necessary, is appropriated for the fiscal year ending June 30, 2003, from the general fund to the work force training and education coordinating board for the purposes of section 4 of this act.