1-1 AN ACT
1-2 relating to repayment assistance for certain law school loans.
1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 1. Chapter 61, Education Code, is amended by adding
1-5 Subchapter X to read as follows:
1-6 SUBCHAPTER X. REPAYMENT OF CERTAIN LAW SCHOOL EDUCATION LOANS:
1-7 ATTORNEY OF NONPROFIT ORGANIZATION SERVING INDIGENT PERSONS
1-8 Sec. 61.951. REPAYMENT ASSISTANCE AUTHORIZED. (a) The board
1-9 shall provide, in accordance with this subchapter and board rules,
1-10 assistance in the repayment of law school education loans for
1-11 attorneys who apply and qualify for the assistance.
1-12 (b) The provision of financial assistance in the repayment
1-13 of education loans under this subchapter promotes a public purpose.
1-14 Sec. 61.952. ELIGIBILITY. To be eligible to receive
1-15 repayment assistance, an attorney must:
1-16 (1) apply to the board;
1-17 (2) be a full-time employee of the eligible
1-18 organization; and
1-19 (3) be currently practicing in this state as an
1-20 attorney employed by an organization that:
1-21 (A) qualifies for an exemption from federal
1-22 income taxes under Section 501(c)(3), Internal Revenue Code of
1-23 1986, as amended, that is prohibited from providing representation
1-24 in a class-action lawsuit; and
2-1 (B) receives funds for providing legal services
2-2 to indigent individuals from:
2-3 (i) the Interest on Lawyers' Trust
2-4 Accounts program administered by the Texas Equal Access to Justice
2-5 Foundation; or
2-6 (ii) the basic civil legal services
2-7 account under Section 51.943, Government Code.
2-8 Sec. 61.953. LIMITATIONS. (a) An attorney may receive
2-9 repayment assistance grants for each of not more than 10 years.
2-10 (b) The amount of loan repayment assistance received by an
2-11 attorney under this subchapter may not exceed 50 percent of the
2-12 total amount of the attorney's outstanding law school loans,
2-13 including scheduled interest payments that would become due if the
2-14 loan is not prepaid, when the attorney enters into the agreement.
2-15 Sec. 61.954. ELIGIBLE LOANS. (a) The board may provide
2-16 repayment assistance for the repayment of any education loan
2-17 received by the attorney through any lender for education at a
2-18 school of law authorized by the board to award a degree that
2-19 satisfies the law study requirements for licensure as an attorney
2-20 in this state.
2-21 (b) The board may not provide repayment assistance for an
2-22 education loan that is in default at the time of the attorney's
2-23 application.
2-24 Sec. 61.955. REPAYMENT. (a) The board shall deliver any
2-25 repayment assistance made under this subchapter in a lump sum
2-26 payable to the lender and the attorney and in accordance with any
2-27 applicable federal law.
3-1 (b) Loan repayment assistance received under this subchapter
3-2 may be applied to the principal amount of the loan and to interest
3-3 that accrues.
3-4 (c) Any repayment assistance shall be reasonably related to
3-5 the amount of time an attorney is employed by the eligible
3-6 organization.
3-7 Sec. 61.956. ADVISORY COMMITTEE. The board may appoint an
3-8 advisory committee to assist the board in performing the board's
3-9 duties under this subchapter.
3-10 Sec. 61.957. ACCEPTANCE OF GIFTS. The board may solicit and
3-11 accept gifts, grants, and donations for the purposes of this
3-12 subchapter.
3-13 Sec. 61.958. RULES. (a) The board shall adopt rules
3-14 necessary for the administration of this subchapter, including a
3-15 rule that sets a maximum amount of repayment assistance that an
3-16 attorney may receive in one year.
3-17 (b) The board shall distribute a copy of the rules adopted
3-18 under this section and pertinent information in this subchapter to:
3-19 (1) each school of law authorized by the board to
3-20 award a degree described by Section 61.954(a);
3-21 (2) any appropriate state agency; and
3-22 (3) any appropriate professional association.
3-23 SECTION 2. Chapter 61, Education Code, is amended by adding
3-24 Subchapter Y to read as follows:
3-25 SUBCHAPTER Y. REPAYMENT OF CERTAIN LAW SCHOOL EDUCATION LOANS:
3-26 ASSISTANT DISTRICT OR COUNTY ATTORNEY
3-27 Sec. 61.9601. DEFINITION. In this subchapter, "rural county"
4-1 means a county with a population of 50,000 or less.
4-2 Sec. 61.9602. REPAYMENT ASSISTANCE AUTHORIZED. (a) The
4-3 board shall provide, using funds appropriated for that purpose and
4-4 in accordance with this subchapter and board rules, assistance in
4-5 the repayment of law school education loans for attorneys who apply
4-6 and qualify for the assistance.
4-7 (b) The provision of financial assistance in the repayment
4-8 of education loans under this subchapter promotes a public purpose.
4-9 Sec. 61.9603. ELIGIBILITY. To be eligible to receive
4-10 repayment assistance, an attorney must:
4-11 (1) apply to the board;
4-12 (2) be currently employed as an attorney by a district
4-13 or county attorney's office that serves a rural county; and
4-14 (3) enter into an agreement to remain employed by the
4-15 district or county attorney's office as provided by Section
4-16 61.9605.
4-17 Sec. 61.9604. ELIGIBLE LOANS. (a) The board may provide
4-18 repayment assistance for the repayment of any education loan
4-19 received by the attorney through any lender for education at a
4-20 school of law authorized by the board to award a degree that
4-21 satisfies the law study requirements for licensure as an attorney
4-22 in this state.
4-23 (b) The board may not provide repayment assistance for an
4-24 education loan that is in default at the time of the attorney's
4-25 application.
4-26 Sec. 61.9605. AGREEMENT. (a) To qualify for loan repayment
4-27 assistance under this subchapter, a person must enter into a
5-1 written agreement with the board as provided by this section. The
5-2 agreement must specify the conditions the person must satisfy to
5-3 receive repayment assistance.
5-4 (b) The agreement must require the person to be employed for
5-5 a period of five years with a district or county attorney's office
5-6 that serves a rural county. Only employment with that district or
5-7 county attorney's office as an attorney after the date the person
5-8 enters into the agreement may be used to satisfy the employment
5-9 requirement under the agreement.
5-10 (c) The agreement must provide that the repayment assistance
5-11 the person receives before the person has been employed for five
5-12 years as required by the agreement constitutes a loan until the
5-13 person completes the five years of employment and satisfies any
5-14 other applicable conditions of the agreement. The agreement must
5-15 require the person to sign a promissory note acknowledging the
5-16 conditional nature of the repayment assistance received and
5-17 promising to repay the amount of that assistance received plus
5-18 applicable interest and reasonable collection costs if the person
5-19 does not satisfy the applicable conditions. The board shall
5-20 determine the terms of the promissory note. To the extent
5-21 practicable, the terms must be the same as those applicable to
5-22 state or federally guaranteed student loans made at the same time.
5-23 All amounts collected in repayment of a loan under this subsection,
5-24 including interest, but excluding collection costs paid by the
5-25 board to another person to collect or assist in collecting the
5-26 amount, shall be deposited to the credit of the trust fund
5-27 established by Section 61.9608.
6-1 Sec. 61.9606. REPAYMENT. (a) Except as provided by Section
6-2 61.9609(a), the board shall provide repayment assistance under this
6-3 subchapter in the following amounts:
6-4 (1) 60 percent of each payment due on an attorney's
6-5 eligible loans during the first 12-month period after the attorney
6-6 enters into the agreement under Section 61.9605;
6-7 (2) 80 percent of each payment due on an attorney's
6-8 eligible loans during the second 12-month period after the attorney
6-9 enters into the agreement; and
6-10 (3) 100 percent of each payment due on an attorney's
6-11 eligible loans during the third 12-month period after the attorney
6-12 enters into the agreement.
6-13 (b) The board shall deliver any repayment assistance made
6-14 under this subchapter in a lump sum payable to the lender and the
6-15 attorney and in accordance with any applicable federal law.
6-16 (c) Loan repayment assistance received under this subchapter
6-17 may be applied to the principal amount of the loan and to interest
6-18 that accrues.
6-19 Sec. 61.9607. ADVISORY COMMITTEE. The board may appoint an
6-20 advisory committee from outside the board's membership to assist
6-21 the board in performing the board's duties under this subchapter.
6-22 Sec. 61.9608. FUNDING. (a) The loan repayment assistance
6-23 program established by this subchapter is funded from the rural
6-24 district and county attorney student loan assistance trust fund.
6-25 The trust fund is established outside the treasury and is
6-26 administered by the comptroller. Money in the trust fund may be
6-27 spent without appropriation and only to fund the program. Interest
7-1 and income from the assets of the trust fund shall be credited to
7-2 and deposited in the trust fund.
7-3 (b) The board may solicit and accept gifts, grants, and
7-4 donations from any public or private source for the purposes of
7-5 this subchapter and shall deposit money accepted under this
7-6 subsection to the credit of the trust fund.
7-7 (c) The legislature may appropriate money to the trust fund.
7-8 Sec. 61.9609. RULES. (a) The board shall adopt rules
7-9 necessary for the administration of this subchapter, including a
7-10 rule that sets the maximum amount of loan repayment assistance that
7-11 an attorney may receive in one year.
7-12 (b) The board shall distribute a copy of the rules adopted
7-13 under this section and pertinent information in this subchapter to:
7-14 (1) each school of law authorized by the board to
7-15 award a degree described by Section 61.9604(a); and
7-16 (2) any appropriate district or county attorneys.
7-17 SECTION 3. The Texas Higher Education Coordinating Board
7-18 shall adopt the rules for the repayment assistance program under
7-19 Subchapter X, Chapter 61, Education Code, as added by this Act, not
7-20 later than December 1, 2001.
7-21 SECTION 4. This Act takes effect September 1, 2001.
_______________________________ _______________________________
President of the Senate Speaker of the House
I certify that H.B. No. 2323 was passed by the House on
May 8, 2001, by a non-record vote; and that the House concurred in
Senate amendments to H.B. No. 2323 on May 25, 2001, by a non-record
vote; and that the House adopted H.C.R. No. 323 authorizing certain
corrections in H.B. No. 2323 on May 28, 2001, by a non-record vote.
_______________________________
Chief Clerk of the House
I certify that H.B. No. 2323 was passed by the Senate, with
amendments, on May 22, 2001, by a viva-voce vote; and that the
Senate adopted H.C.R. No. 323 authorizing certain corrections in
H.B. No. 2323 on May 28, 2001, by a viva-voce vote.
_______________________________
Secretary of the Senate
APPROVED: __________________________
Date
__________________________
Governor