2302-S2

AN ACT Relating to the Washington state student scholarship partnership program; and adding a new chapter to Title 28B RCW.

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

NEW SECTION. Sec. 1. The Washington state student scholarship partnership program is established. The purpose of the program is to assist Washington's accredited public and independent colleges, universities, and career schools to raise private funds to assist needy and meritorious Washington residents attending in-state institutions of higher education.

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

(1) "Eligible needy student" means a student who: (a) Meets the residency requirements of RCW 28B.15.012(2), as demonstrated in RCW 28B.15.013; (b) is needy, as defined in RCW 28B.10.802(3); (c) is meritorious, as defined by the institution of higher education that the student attends; and (d) is enrolled in an institution of higher education.

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

(3) "Institution of higher education" means a public or independent institution of higher education or private career school or college, that: (a) Is located in the state of Washington; (b) is accredited by an accrediting association recognized by the board for the purposes of this program; (c) meets conditions adopted by the board for the program; and (d) is accepted by the board for participation in the program.

(4) "Foundation" means a private, nonprofit corporation that: (a) Is registered under Title 24 RCW and qualifies as a tax-exempt entity under section 501(c)(3) of the federal internal revenue code; (b) exists solely for the benefit of one or more institutions of higher education located in the state of Washington; and (c) is registered with the attorney general's office under the charitable trust act, chapter 11.110 RCW.

NEW SECTION. Sec. 3. The Washington state student scholarship partnership program shall be administered by the board, in consultation with institutions of higher education. In its administration of the program, the board's duties may include, but need not be limited to:

(1) The adoption of rules, deadlines, and procedures. The rules shall encourage scholarship recipients to repay the scholarship in order to help other needy students, when the recipient's financial circumstances permit such repayment;

(2) When the conditions of section 5 of this act are met, the release of state matching funds to eligible needy students attending independent institutions of higher education or private career schools and colleges;

(3) When the conditions of section 5 of this act are met, the release of state matching funds to participating public institutions of higher education or their foundations for distribution to eligible needy students;

(4) The determination of minimum and maximum scholarship amounts per needy eligible student;

(5) The adoption of an annual allocation system based on factors that may include, but need not be limited to: The amount of money available in the trust fund; the characteristics of potential participating institutions including the numbers of eligible needy students enrolled in each such institution, adjusted by each eligible needy student's rate of enrollment; the amount of private cash donations that each potential participating institution commits to raise annually for the program; and the amount of money previously received by each participating institution or its foundation;

(6) The adoption of annual minimum matching amounts;

(7) The adoption of contracts with participating institutions and foundations. The contracts may include any conditions required of participants by the board, including but not limited to requirements to maintain records on the disposition of state and private matching funds and to provide an accounting of students assisted through the program;

(8) The adoption of policies that maximize the distribution of trust fund and matching moneys to eligible needy students;

(9) The adoption of a mechanism to reallocate unused funds to institutions of higher education or eligible needy students attending such institutions if the institutions have used their annual allotment of state matching moneys and have raised additional private donations for which the state matching funds were not available; and

(10) The preparation and distribution of an annual report on the results of the program. The report shall include an accounting of the students who have benefited through the program.

NEW SECTION. Sec. 4. The Washington state student scholarship partnership program trust fund is established in the custody of the state treasurer. Funds appropriated by the legislature for the program shall be deposited into the trust fund. At the request of the board and when the conditions of section 5 of this act are met, the treasurer shall release state matching funds from the trust fund to any institution of higher education or its foundation as designated by the board or to the board for distribution to eligible needy students. No appropriation is required for expenditures from the trust fund.

NEW SECTION. Sec. 5. Subject to rules adopted by the board:

(1) All institutions of higher education are eligible to participate in the program if they meet conditions adopted by the board. An institution may apply to the board for money from the trust fund when the institution or its foundation can match the money in the trust fund with an equal amount of cash donations from private sources.

(2) Institutions of higher education shall adopt a definition of merit for the purposes of the program.

(3) Public institutions of higher education or their foundations shall distribute the private donations and state matching funds to eligible needy students attending the institution.

(4) Private and independent institutions of higher education or their foundations shall distribute to eligible needy students private cash donations in an amount that equals the state matching moneys received by the student.

(5) Only moneys received by an institution of higher education or its foundation after the effective date of this section shall qualify as matching funds.

(6) Cash donations from private sources eligible for state matching funds under this program must supplement and not supplant the level of private gift aid awarded to students by the respective institution or its foundation during the 1995-96 academic year.

NEW SECTION. Sec. 6. A foundation is not eligible to receive moneys from the trust fund unless the foundation and the governing board of the institution of higher education for whose benefit the foundation exists have entered into a contract, approved by the attorney general that: (1) Specifies the services to be provided by the foundation; (2) provides for the protection of any state matching funds under the foundation's control that were provided under the program; and (3) provides for the institution's assumption of the ownership, management, and control of program funds if the foundation ceases to exist, fails to function properly, or fails to provide the specified services in accordance with the contract.

NEW SECTION. Sec. 7. Sections 1 through 6 of this act shall constitute a new chapter in Title 28B RCW.