BILL REQ. #:  S-1506.1 

READ FIRST TIME 02/9/07.   

     AN ACT Relating to creating a scholarship for students entering mathematics and science professions; reenacting and amending RCW 43.79A.040; 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 legislature finds that encouraging outstanding students to enter mathematics and science professions is of paramount importance to the state of Washington. By creating the mathematics and science professions conditional scholarship, the legislature intends to assist in the effort to recruit as mathematics and science professionals individuals who have distinguished themselves through outstanding academic achievement or demonstrated their commitment to mathematics and science professions. The legislature urges business, industry, and philanthropic community organizations to join with state government in making this program successful.

NEW SECTION.  Sec. 2   Unless the context clearly requires otherwise, the definitions in this section apply throughout this chapter.
     (1) "Board" means the higher education coordinating board.
     (2) "Conditional scholarship" means a loan that is forgiven in whole or in part if the recipient renders service in a qualified profession in this state.
     (3) "Eligible student" means a student who is registered for at least six credit hours or the equivalent, has a 3.0 grade point average at an institution of higher education, is a resident student as defined by RCW 28B.15.012 and 28B.15.013, has declared mathematics, engineering, a physical science, or a natural science for his or her major, and has a declared intention to complete a program leading to a qualified profession in the state of Washington.
     (4) "Forgiven" or "to forgive" or "forgiveness" means to render service in a qualified profession in the state of Washington in lieu of monetary repayment.
     (5) "Institution of higher education" or "institution" means a college or university in the state of Washington that is accredited by an accrediting association recognized as such by rule of the board.
     (6) "Participant" means an eligible student who has received a conditional scholarship under this chapter.
     (7) "Qualified profession" means a mathematics, engineering, physical science, or natural science profession.
     (8) "Satisfied" means paid-in-full.

NEW SECTION.  Sec. 3   The qualified professions conditional scholarship program is established. The program shall be administered by the board. In administering the program, the board has the following powers and duties:
     (1) Select students to receive conditional scholarships;
     (2) Adopt necessary rules and guidelines;
     (3) Publicize the program;
     (4) Collect and manage repayments from students who do not meet their obligations under this chapter; and
     (5) Solicit and accept grants and donations from public and private sources for the program.

NEW SECTION.  Sec. 4   (1) The board may select participants based on an application process conducted by the board.
     (2) The board shall establish a selection committee for screening and selecting recipients of the qualified professions conditional scholarships. The criteria shall emphasize factors demonstrating excellence including but not limited to superior scholastic achievement, leadership ability, and community contributions. The criteria shall also take into account the diverse nature of the disciplines eligible for the conditional scholarship and allocate the funds in a manner to represent a cross section of the fields.

NEW SECTION.  Sec. 5   To receive additional disbursements under the program under this chapter, a participant must be considered by his or her institution of higher education to be in a satisfactory progress condition.

NEW SECTION.  Sec. 6   The board may award 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 the amount of tuition and fees at the institution of higher education attended by the participant or resident undergraduate tuition and fees at the University of Washington per academic year for a full-time student, whichever is lower. Participants are eligible to receive conditional scholarships for a maximum of five years.

NEW SECTION.  Sec. 7   (1) Participants in the qualified professions conditional scholarship program incur an obligation to repay the conditional scholarship, with interest, unless they are employed in a qualified profession for each year of scholarship received, under rules adopted by the board.
     (2) The interest rate shall be determined annually by the board.
     (3) The minimum payment shall be set by the board. The maximum period for repayment shall be ten years, with payments of principal and interest accruing quarterly commencing six months from the date the participant completes or discontinues the course of study. Provisions for deferral of payment shall be determined by the board.
     (4) The entire principal and interest of each payment shall be forgiven for each payment period in which the participant is employed in a qualified profession until the entire repayment obligation is satisfied. Should the participant cease to be employed in a qualified profession in this state 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.
     (5) 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.
     (6) Receipts from the payment of principal or interest or any other subsidies to which the board as administrator is entitled, that are paid by or on behalf of participants under this section, shall be deposited in the qualified professions conditional scholarship account and shall be used to cover the costs of granting the conditional scholarships, maintaining necessary records, and making collections under subsection (5) 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 to eligible students.
     (7) The board shall adopt rules to define the terms of repayment, including applicable interest rates, fees, and deferments.

NEW SECTION.  Sec. 8   (1) The qualified professions conditional scholarship account is created in the custody of the state treasurer. An appropriation is not required for expenditures of funds from the account. The account is not subject to allotment procedures under chapter 43.88 RCW except for moneys used for program administration.
     (2) The board shall deposit in the account all moneys received for the program. The account shall be self-sustaining and consist of funds appropriated by the legislature for the qualified professions conditional scholarship program, private contributions to the program, and receipts from participant repayments.
     (3) Expenditures from the account may be used solely for conditional scholarships to participants in the program established by this chapter and costs associated with program administration by the board.
     (4) Disbursements from the account may be made only on the authorization of the board.

Sec. 9   RCW 43.79A.040 and 2006 c 311 s 21 and 2006 c 120 s 2 are each reenacted and 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 Washington promise scholarship account, the college savings program account, the Washington advanced college tuition payment program account, the agricultural local fund, the American Indian scholarship endowment fund, the foster care scholarship endowment fund, the foster care endowed scholarship trust fund, the students with dependents grant account, the basic health plan self-insurance reserve account, the contract harvesting revolving account, the Washington state combined fund drive account, the commemorative works account, the Washington international exchange scholarship endowment fund, the developmental disabilities endowment trust fund, the energy account, the fair fund, the fruit and vegetable inspection account, the future teachers conditional scholarship account, the game farm alternative account, the grain inspection revolving fund, the juvenile accountability incentive account, the law enforcement officers' and fire fighters' plan 2 expense fund, the local tourism promotion account, the produce railcar pool account, the qualified professions conditional scholarship account, the regional transportation investment district account, the rural rehabilitation account, the stadium and exhibition center account, the youth athletic facility account, the self-insurance revolving fund, the sulfur dioxide abatement account, the children's trust fund, the Washington horse racing commission Washington bred owners' bonus fund account, the Washington horse racing commission class C purse fund account, the individual development account program account, the Washington horse racing commission operating account (earnings from the Washington horse racing commission operating account must be credited to the Washington horse racing commission class C purse fund account), the life sciences discovery fund, and the reading achievement account. 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 city and county advance right-of-way revolving fund, 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. 10   Sections 1 through 8 of this act constitute a new chapter in Title 28B RCW.