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SUBSTITUTE
HOUSE BILL 2294
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Passed
Legislature - 1996 Regular Session
State of Washington 54th
Legislature 1996 Regular Session
By
Read first time 01/29/96.
Changing provisions
relating to the state educational trust fund.
AN ACT
Relating to the state educational trust fund; and amending RCW 28B.10.821 and
28B.15.762.
BE IT ENACTED BY THE LEGISLATURE
OF THE STATE OF WASHINGTON:
Sec.
1. RCW
28B.10.821 and 1991 sp.s. c 13 s 12 are each amended to read as follows:
The
state educational ((grant account)) trust fund is hereby
established in the state treasury. The primary purpose of the trust is to
pledge state-wide available college student assistance to needy or
disadvantaged students, especially middle and high school youth, considered
at-risk of dropping out of secondary education who participate in board-approved
early awareness and outreach programs and who enter any accredited Washington
institution of postsecondary education within two years of high school
graduation.
The ((commission))
board shall deposit refunds and recoveries of student financial aid funds
expended in prior biennia in such account. The board may also deposit
moneys that have been contributed from other state, federal, or private
sources.
Expenditures
from ((such account)) the fund shall be for financial aid to
needy or disadvantaged students. The board may annually expend such sums
from the fund as may be necessary to fulfill the purposes of this section,
including not more than three percent for the costs to administer aid programs
supported by the fund. All earnings of investments of balances in the state
educational trust fund shall be credited to the trust fund. Expenditures from
the fund shall not be subject to appropriation but are subject to allotment
procedures under chapter 43.88 RCW.
Sec.
2. RCW
28B.15.762 and 1985 c 370 s 80 are each amended to read as follows:
(1)
The board may make long-term loans to eligible students at institutions of
higher education from the funds appropriated to the board for this purpose.
The amount of any such loan shall not exceed the demonstrated financial need of
the student or two thousand five hundred dollars for each academic year
whichever is less, and the total amount of such loans to an eligible student
shall not exceed ten thousand dollars. The interest rates and terms of
deferral of such loans shall be consistent with the terms of the guaranteed
loan program established by 20 U.S.C. Sec. 1701 et seq. The period for
repaying the loan principal and interest shall be ten years with payments
accruing quarterly commencing nine months from the date the borrower
graduated. The entire principal and interest of each loan payment shall be
forgiven for each payment period in which the borrower teaches science or
mathematics in a public school in this state until the entire loan is satisfied
or the borrower ceases to teach science or mathematics at a public school in
this state. Should the borrower cease to teach science or mathematics at a
public school in this state before the time in which the principal and interest
on the loan are satisfied, payments on the unsatisfied portion of the principal
and interest on the loan shall begin the next payment period and continue until
the remainder of the loan is paid.
(2)
The board is responsible for collection of loans made under subsection (1) of
this section and shall exercise due diligence in such collection, maintaining
all necessary records to insure that maximum repayments are made. Collection
and servicing of loans under subsection (1) of this section shall be pursued
using the full extent of the law, including wage garnishment if necessary, and
shall be performed by entities approved for such servicing by the Washington
student loan guaranty association or its successor agency. The board is
responsible to forgive all or parts of such loans under the criteria
established in subsection (1) of this section and shall maintain all necessary
records of forgiven payments.
(3)
Receipts from the payment of principal or interest or any other subsidies to
which the board as lender is entitled, which are paid by or on behalf of
borrowers under subsection (1) of this section, shall be deposited with the
higher education coordinating board and shall be used to cover the costs of
making the loans under subsection (1) of this section, maintaining necessary
records, and making collections under subsection (2) 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 make loans to eligible students.
(4) Any
funds not used to make loans, or to cover the cost of making loans or making
collections, shall be placed in the state educational trust fund for needy or
disadvantaged students.
(5)
The board shall adopt necessary rules to implement this section.
