1-1 AN ACT 1-2 relating to repayment assistance for certain education loans owed 1-3 by certain state attorneys. 1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-5 SECTION 1. Chapter 61, Education Code, is amended by adding 1-6 Subchapter X to read as follows: 1-7 SUBCHAPTER X. REPAYMENT OF CERTAIN EDUCATION LOANS OWED 1-8 BY CERTAIN STATE ATTORNEYS 1-9 Sec. 61.951. REPAYMENT ASSISTANCE AUTHORIZED. (a) The 1-10 board may provide, in accordance with this subchapter and board 1-11 rules, assistance in the repayment of education loans for attorneys 1-12 who apply and qualify for the assistance. 1-13 (b) The provision of financial assistance in the repayment 1-14 of education loans under this subchapter promotes a public purpose. 1-15 Sec. 61.952. ELIGIBILITY. To be eligible to receive 1-16 repayment assistance, an attorney must: 1-17 (1) apply to the board; 1-18 (2) be employed by or have been offered employment 1-19 with the office of the attorney general at the time the attorney 1-20 applies for the assistance; and 1-21 (3) enter into an agreement to serve as an attorney 1-22 with the office of the attorney general as provided by Section 1-23 61.953. 1-24 Sec. 61.953. AGREEMENT; TERMS. (a) To qualify for 2-1 repayment assistance under this subchapter, an attorney must enter 2-2 into a written agreement with the board as provided by this 2-3 subchapter. The agreement must specify the conditions the attorney 2-4 must satisfy to receive the repayment assistance. 2-5 (b) To be eligible to receive the repayment assistance, an 2-6 attorney must agree to serve at least three years as an attorney 2-7 with the office of the attorney general. 2-8 (c) Only service as an attorney with the office of the 2-9 attorney general after the date the attorney enters into the 2-10 agreement may be used to satisfy the service requirement under the 2-11 agreement. 2-12 (d) The attorney must complete the service obligation during 2-13 the three years following the date of the agreement unless the 2-14 board grants the attorney additional time to begin fulfilling the 2-15 service obligation. The board shall grant the attorney additional 2-16 time to complete the service obligation for good cause. 2-17 (e) The board shall cancel an attorney's service obligation 2-18 if the board determines that the attorney: 2-19 (1) has become permanently disabled so that the 2-20 attorney is not able to serve as an attorney with the office of the 2-21 attorney general; or 2-22 (2) has died. 2-23 (f) The board shall require an attorney who receives the 2-24 repayment assistance to sign an agreement in the nature of a 2-25 contract under which the attorney agrees to perform the required 2-26 years of service. If the attorney does not fulfill the terms of 2-27 the agreement, all repayment assistance paid under this subchapter 3-1 on behalf of the attorney becomes a loan and must be repaid. The 3-2 agreement must include a promissory note acknowledging the 3-3 conditional nature of the repayment assistance and promising to 3-4 repay the amount of the loan repayment, applicable interest, and 3-5 reasonable collection costs if the attorney does not satisfy the 3-6 applicable conditions. The board shall determine the terms of the 3-7 promissory note. 3-8 Sec. 61.954. LIMITATIONS. (a) For each year that an 3-9 attorney serves as an attorney with the office of the attorney 3-10 general under an agreement under Section 61.953, the attorney may 3-11 receive repayment assistance under this subchapter in an amount not 3-12 to exceed $6,000. 3-13 (b) An attorney may not receive repayment assistance under 3-14 this subchapter for more than three years. 3-15 Sec. 61.955. ELIGIBLE LOANS. (a) The board may provide 3-16 repayment assistance for the repayment of any education loan 3-17 received by the attorney through any lender, other than a private 3-18 individual, for: 3-19 (1) education at a school of law authorized by the 3-20 board to award a degree that satisfies the law study requirements 3-21 for licensure as an attorney in this state; or 3-22 (2) undergraduate education at an institution of 3-23 higher education or an accredited private or independent 3-24 institution of higher education. 3-25 (b) The board may not provide repayment assistance for an 3-26 education loan that is in default at the time of the attorney's 3-27 application. 4-1 (c) Each state fiscal biennium the board shall attempt to 4-2 allocate all funds appropriated for the purpose of providing 4-3 repayment assistance under this subchapter. 4-4 Sec. 61.956. REPAYMENT. (a) The board shall deliver any 4-5 repayment assistance made under this subchapter in a lump sum 4-6 payable to the lender and the attorney and in accordance with any 4-7 applicable federal law. 4-8 (b) Repayment assistance received under this subchapter may 4-9 be applied to the principal amount of the loan and to interest that 4-10 accrues. 4-11 Sec. 61.957. ASSISTANCE AVAILABLE TO BOARD. The board may: 4-12 (1) appoint an advisory committee from outside the 4-13 board's membership to assist the board in performing the board's 4-14 duties under this subchapter; and 4-15 (2) request the assistance of the State Bar of Texas 4-16 and the office of the attorney general in performing those duties. 4-17 Sec. 61.958. ACCEPTANCE OF FUNDS. The board may solicit and 4-18 accept gifts, grants, and donations for the purposes of this 4-19 subchapter. 4-20 Sec. 61.959. RULES. (a) The board shall adopt rules 4-21 necessary for the administration of this subchapter. 4-22 (b) The board shall distribute a copy of the rules adopted 4-23 under this section and pertinent information in this subchapter to: 4-24 (1) each school of law authorized by the board to 4-25 award a degree described by Section 61.955(a)(1); 4-26 (2) any appropriate state agency; and 4-27 (3) any appropriate professional association. 5-1 Sec. 61.960. TOTAL AMOUNT OF REPAYMENT ASSISTANCE. The total 5-2 amount of repayment assistance distributed by the board under this 5-3 subchapter may not exceed the total amount of gifts, grants, and 5-4 donations accepted by the board for repayment assistance and 5-5 tuition set aside under Section 61.961. 5-6 Sec. 61.961. LAW SCHOOL TUITION SET ASIDE FOR CERTAIN LOAN 5-7 REPAYMENTS. (a) The governing board of each public school of law 5-8 in this state authorized by the board to award a degree that 5-9 satisfies the law study requirements for licensure as an attorney 5-10 in this state shall set aside one percent of tuition charges for 5-11 resident students enrolled in the school of law. 5-12 (b) The amount set aside shall be transferred to the 5-13 comptroller to be maintained in the state treasury for the sole 5-14 purpose of repayment of education loans of attorneys under this 5-15 subchapter. Section 403.095(b), Government Code, does not apply to 5-16 the amount set aside under this section. 5-17 Sec. 61.962. LIMITATIONS ON FUNDING. The loan repayment 5-18 program under this subchapter may be funded only from: 5-19 (1) gifts, grants, and donations accepted by the 5-20 board; and 5-21 (2) tuition set aside under Section 61.961. 5-22 SECTION 2. The Texas Higher Education Coordinating Board 5-23 shall adopt the rules for the repayment assistance program under 5-24 Subchapter X, Chapter 61, Education Code, as added by this Act, not 5-25 later than December 1, 2001. 5-26 SECTION 3. The Texas Higher Education Coordinating Board 5-27 shall submit a report to the legislature regarding the board's 6-1 activities under Subchapter X, Chapter 61, Education Code, as added 6-2 by this Act, not later than December 1, 2004. 6-3 SECTION 4. This Act takes effect September 1, 2001. _______________________________ _______________________________ President of the Senate Speaker of the House I certify that H.B. No. 2766 was passed by the House on May 4, 2001, by a non-record vote; and that the House concurred in Senate amendments to H.B. No. 2766 on May 25, 2001, by a non-record vote. _______________________________ Chief Clerk of the House I certify that H.B. No. 2766 was passed by the Senate, with amendments, on May 21, 2001, by a viva-voce vote. _______________________________ Secretary of the Senate APPROVED: __________________________ Date __________________________ Governor