Report Title:

Student Loan for Teachers

Description:

Creates an incentive for students to become teachers and to ensure that these graduates teach in our public schools.

THE SENATE

S.B. NO.

2816

TWENTY-FIRST LEGISLATURE, 2002

 

STATE OF HAWAII

 


 

A BILL FOR AN ACT

 

RELATING TO STUDENT LOANS FOR TEACHERS.

 

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

SECTION 1. The National Commission on Teaching and America's Future (NCTAF), a national organization with nineteen partner states, including Hawaii, is focused on improving student learning by ensuring that there is a caring, competent, and qualified teacher in every classroom.

The legislature enacted Act 307, Session Laws of Hawaii 2001, which was originally proposed by NCTAF, that established the Hawaii education loan program and special fund with the purpose of providing financial support to students enrolled in a State-approved teacher education program at the University of Hawaii. If upon graduation the student is employed as a full-time teacher in Hawaii's public school system for a minimum of ten consecutive years, the student's loan would be forgiven.

The legislature finds that the shortage of teachers in Hawaii has reached a critical level and that the state must do all it can to resolve this situation. In addition to the teacher-education program at the University of Hawaii, there are numerous private universities and colleges in Hawaii that have State-approved teacher education programs that produce excellent teachers. The legislature finds that these graduates should be given the same incentives to teach in Hawaii's public school system that are currently available to University of Hawaii graduates.

The purpose of this Act is to include students enrolled in State-approved teacher education programs at private universities and colleges in the Hawaii educator loan program.

SECTION 2. Section 304-20.6, Hawaii Revised Statutes, is amended to read as follows:

["304-20.6] Hawaii educator loan program; special fund. (a) There is created the Hawaii educator loan program to be administered by [the University of Hawaii,] a designated federal credit union with existing services for teachers, for the purpose of providing financial support to students who complete a [State-approved] teacher education program and who agree to teach in the Hawaii public school system. Eligibility shall be [awarded by the University of Hawaii] determined by the registrar of a State-approved teacher education program and the loan administered by a designated federal credit union with existing services for teachers to students on a competitive basis. The amount to be loaned to a student shall be determined by [the board of regents]a designated federal credit union with existing services for teachers based on need for financial aid and proof of acceptance into a [State-approved] teacher education program [at the University of Hawaii]. The maximum amount of loans that a student may receive under this program shall be an aggregate amount equivalent to tuition payments and costs of textbooks and other instructional materials necessary to complete a [State-approved] teacher education program[.], and shall not exceed the amount such payments and costs would amount to at the University of Hawaii.

(b) There is created in the treasury of the State, the Hawaii educator loan program special fund, for the purpose of providing loans pursuant to subsection (a). All loans made under this section shall bear interest at five per cent simple interest. Repayment of principal and interest charges shall commence one year after graduation or three months after a borrower ceases to be enrolled in the [State-approved] teacher education program and shall be paid in periodic installments within a [ten-year] six-year period. The [university] designated federal credit union with existing services for teachers may charge late fees and all other reasonable costs for the collection of delinquent loans. All interest and payments received on account of principal shall be credited to the special fund.

(c) Upon a showing of proof that the individual has completed a [State-approved] teacher education program and is employed as a full-time teacher in the Hawaii public school system, one-tenth of the total amount of the loan and interest shall be waived for every year of the first five years and five-tenths of the total amount after the sixth year, that a loan recipient teaches in a Hawaii public school in a hard-to-fill position as determined by the superintendent of education, including special education, regular education shortage categories, or Title 1 schools, and in one of the following capacities:

(1) As an elementary school teacher teaching in the field of elementary education who has met standards as set forth by the Hawaii teacher standards board; or

(2) As a secondary school teacher teaching in the subject area that is relevant to the loan recipient's academic major as certified by the department of education who has met standards as set forth by the Hawaii teacher standards board.

Liability for repayment of a loan shall be canceled upon the death or permanent total disability of the borrower.

(d) If a loan recipient subject to this section fails to teach in the Hawaii public school system for a minimum of [ten] six consecutive years from the loan recipient's original date of employment with the department of education, excluding sabbatical and other forms of temporary leaves of absence, then the loan recipient shall repay any remaining loan balance at the rate of ten per cent simple interest.

(e) [In accordance with chapter 103D, the university] The designated federal credit union with existing services for teachers may enter into written contracts with collection agencies for the purpose of collecting delinquent student loans. All payments collected, exclusive of a collection agency's commissions, shall revert, and be credited, to the loan fund. A collection agency that enters into a written contract with the [University of Hawaii] designated federal credit union with existing services for teachers for the collection of delinquent student loans pursuant to this section, may collect a commission from the debtor in accordance with the terms of, and up to the amounts authorized in, the written contract."

SECTION 3. There is appropriated out of the general revenues of the State of Hawaii the sum of $100,000, or so much thereof as may be necessary, for fiscal year 2002-2003 for student loans under the Hawaii educator loan program to be deposited to the credit of the Hawaii educator loan program special fund.

The sum appropriated shall be expended by the [University of Hawaii] designated federal credit union with existing services for teachers for the purposes of this Act."

SECTION 4. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 5. This Act shall take effect on July 1, 2002.

INTRODUCED BY:

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