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A BILL TO BE ENTITLED
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AN ACT
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relating to a pilot program to improve student loan default rates |
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and financial aid literacy among postsecondary students. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Subchapter C, Chapter 61, Education Code, is |
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amended by adding Section 61.0763 to read as follows: |
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Sec. 61.0763. STUDENT LOAN DEFAULT PREVENTION AND FINANCIAL |
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AID LITERACY PILOT PROGRAM. (a) In this section, "career school or |
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college" has the meaning assigned by Section 132.001. |
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(b) Not later than January 1, 2014, the board shall |
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establish and administer a pilot program at selected postsecondary |
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educational institutions to ensure that students of those |
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institutions are informed consumers with regard to all aspects of |
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student financial aid, including: |
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(1) the consequences of borrowing to finance a |
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student's postsecondary education; |
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(2) the financial consequences of a student's academic |
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and career choices; and |
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(3) strategies for avoiding student loan delinquency |
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and default. |
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(c) The board shall select at least one institution from |
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each of the following categories of postsecondary educational |
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institutions to participate in the program: |
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(1) institutions of higher education; |
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(2) private or independent institutions of higher |
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education; and |
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(3) career schools or colleges. |
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(d) In selecting postsecondary educational institutions to |
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participate in the pilot program, the board shall give priority to |
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institutions that have: |
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(1) a student loan default rate of more than 20 |
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percent; or |
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(2) a negative trend in the institution's three-year |
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student loan default rate as compared to the institution's cohort |
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default rates reported by the United States Department of |
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Education. |
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(e) The board shall adopt rules for the administration of |
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the pilot program, including rules governing the selection of |
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postsecondary educational institutions to participate in the pilot |
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program consistent with the requirements of Subsection (d). |
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(f) The board may contract with one or more entities to |
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administer the pilot program according to criteria established by |
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board rule. |
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(g) Not later than January 1 of each year, beginning in |
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2016, the board shall submit a report to the governor, the |
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lieutenant governor, and the speaker of the house of |
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representatives regarding the outcomes of the pilot program, as |
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reflected in the federal student loan default rates reported for |
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the participating institutions. |
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(h) This section expires December 31, 2020. |
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SECTION 2. The Texas Higher Education Coordinating Board |
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shall adopt rules for the administration of Section 61.0763, |
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Education Code, as added by this Act, as soon as practicable after |
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this Act takes effect. For that purpose, the coordinating board may |
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adopt the initial rules in the manner provided by law for emergency |
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rules. |
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SECTION 3. This Act takes effect immediately if it receives |
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a vote of two-thirds of all the members elected to each house, as |
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provided by Section 39, Article III, Texas Constitution. If this |
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Act does not receive the vote necessary for immediate effect, this |
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Act takes effect September 1, 2013. |