3278L
96-2555
04/02

HOUSE BILL 1586-FN


AN ACT relative to minimum bonding requirements for postsecondary institutions, the state share of default costs on certain federal student loans, and nursing service required for cancellation of nursing scholarship loan obligations.


SPONSORS: Rep. Larson, Graf 8


COMMITTEE: Education


 

Section 3 of this bill provides that the postsecondary education commission shall adopt rules that require postsecondary institutions which participate in certain federal loan programs to reimburse the state for its proportionate share of any default cost fees. Section 9 of the bill increases the minimum bonding requirements for certain postsecondary institutions.

Sections 6 and 7 allow part-time nursing service to be prorated to meet the full-time nursing service requirement for cancellation of nursing scholarship loan obligations.

The remainder of this bill amends certain RSA provisions making them gender neutral and consistent with other sections amended by the bill in accordance with RSA 17-A:6 relative to gender neutral drafting.

This bill is a request of the postsecondary education commission.


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EXPLANATION: Matter added to current law appears in bold italics.
Matter removed from current law appears in [brackets].
Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.

3278L
96-2555
04/02

110:1 Gender Neutral Language Substitution. Amend RSA 188-D:2, IV to read as follows:
IV. One member to be appointed by the board of governors of the department of regional community-technical colleges who shall be a representative of the regional community-technical institute and colleges who shall be a full-time student at one of these institutions and a resident of the state and whose term shall expire upon graduation or when [he] the member is no longer a full-time student;
110:2 Gender Neutral Language Substitution. Amend RSA 188-D:3-a to read as follows:
188-D:3-a Executive Director. There is [hereby] created the position of executive director of the postsecondary education commission. The executive director shall be appointed by the postsecondary education commission and shall serve for a term of 4 years and until [his] a successor is appointed and qualified. [He] The executive director shall be compensated in the amount prescribed [for him] in RSA 94.
110:3 New Section; Certain Federal Loan Default Cost Fees; Rulemaking. Amend RSA 188-D by inserting after section 8-a the following new section:
188-D:8-b Federal Loan Default Cost Fees; Rulemaking.
I. The commission shall adopt rules under RSA 541-A that require each institution of higher education in this state which participates in the Federal Family Education Loan Program (FEEL) or the Federal Ford/Direct Student Loan Program, under Title IV of the Higher Education Act of 1965 (HEA), as amended, to reimburse the state for its proportionate share of any default cost fee charged to the state by the United States Secretary of Education under the HEA. The rules shall provide a fee structure for determining the amount of the reimbursement for each such institution. The fee charged any institution shall be based on the institution's cohort default rate and the state's risk of loss as provided by Section 4201 of the Omnibus Budget Reconciliation Act of 1993.
II. Notwithstanding any other provisions of law, such rules may provide that an institution may be exempt from such fees, or the commission may adjust an institution's fees, if such institution demonstrates that exceptional mitigating circumstances contributed to its high cohort default rate.
III. The commission shall submit the fee structure and exemption process to the United States Secretary of Education for review and approval prior to implementation.
110:4 Gender Neutral Language Substitution. Amend RSA 188-D:9-b to read as follows:
188-D:9-b Evaluation Committees. The commission shall give ample notice to the [chairmen] chairpersons of both the house and senate standing committees on education before forming a committee for the evaluation of an educational institution with degree granting power under RSA 292:8-h, so that each [chairman, if he wishes,] chairperson may appoint a member of [his] the respective committee to participate as a member of the evaluation committee.
110:5 Gender Neutral Language Substitution. Amend RSA 188-D:13, IV-a to read as follows:
IV-a. The postsecondary education commission may allow a student from New Hampshire to use [his] such grant in another state if a student from that other state may use [his] a grant from the other state in New Hampshire. However, no student from New Hampshire may use [his] such grant out-of-state unless [he] the student shall be given permission to do so by the postsecondary education commission.
110:6 Part-Time Nursing Service May be Prorated to Meet Full-Time Nursing Service Requirement for Cancellation of Loan Obligation. Amend RSA 188-D:18, I and II to read as follows:
I. Recipients of loans for one year shall have their notes cancelled upon satisfactory completion of one year of full-time nursing service or part-time nursing service prorated to equal one year of full-time service in New Hampshire following licensure, or completion of the graduate program.
II. Recipients of loans for more than one year shall have their notes cancelled upon satisfactory completion of 2 years of full-time nursing service or part-time nursing service prorated to equal 2 years of full-time service in New Hampshire immediately following licensure or completion of the graduate program.
110:7 Part-Time Nursing Service May be Prorated to Meet Full-Time Nursing Service Requirement for Cancellation of Loan Obligation. Amend RSA 188-D:18-e, I and II to read as follows:
I. Recipients of loans for one year of full-time study shall have their notes cancelled upon satisfactory completion of one year of full-time nursing service or part-time nursing service prorated to equal one year of full-time service in New Hampshire following licensure or completion of the graduate program. Recipients of loans for one year of part-time study shall have their notes cancelled upon satisfactory completion of one year of part-time nursing service, or its equivalent as determined by the commission, in New Hampshire following licensure or completion of the graduate program.
II. Recipients of loans for more than one year of full-time study shall have their notes cancelled upon satisfactory completion of 2 years of full-time nursing service or part-time nursing service prorated to equal 2 years of full-time service in New Hampshire immediately following licensure or completion of the graduate program. Recipients of loans for more than one year of part-time study shall have their notes cancelled upon satisfactory completion of 2 years of part-time nursing service, or their equivalent as determined by the commission, in New Hampshire immediately following licensure or completion of the graduate program.
110:8 Gender Neutral Language Substitution. Amend RSA 188-D:19, II to read as follows:
II. "Private correspondence school" shall mean any proprietary educational institution doing business in this state which conducts courses of study in which the student studies lessons sent to [him] the student on a regular basis through the mail. It shall not include any educational institution authorized to grant degrees pursuant to RSA 292, any educational institution licensed by some other state agency, nor shall it include any educational institution operated by a business organization exclusively for the training of its own employees.
110:9 Private Commercial, Correspondence, Trade or Other School Charging Tuition or Fees; Minimum Bonding Requirement. Amend RSA 188-D:20, I to read as follows:
I. Every private commercial, correspondence, trade or other school charging tuition or fees which gives pre-employment or supplementary training, or both, established and operated in this state, shall be required to register and obtain a license to conduct such business from the postsecondary education commission. Said license shall be issued under rules to be adopted under RSA 541-A by the postsecondary education commission, which shall establish minimum criteria, such as, financial stability, educational program, administrative, and staff qualifications, business procedures, facilities, equipment, and ethical practices to be met by licensees. In no case shall a license be issued to any institution which has not posted a performance bond with the postsecondary education commission. The amount of such a performance bond shall be based on income from tuition at 10 percent of gross tuition, with a [$5,000] $10,000 minimum and a $200,000 maximum. If an institution licensed pursuant to this section should fail to provide the services called for in a contract with any person, as determined by a court of competent jurisdiction, [said] the bond shall be forfeited, and the proceeds distributed by the postsecondary education commission in such manner as justice and the circumstances require. The fee for a license issued pursuant to this paragraph shall be $250 for initial licenses and $200 for license renewals. [Said] The license shall be renewable yearly.
110:10 Gender Neutral Language Substitution. Amend RSA 188-D:30, I to read as follows:
I. The postsecondary education commission shall appoint a committee to be known as the "out-of-state students incentive committee" which shall review and make recommendations to the executive director of the commission regarding grant applicants. The committee shall choose a [chairman] chairperson from among its members and shall make decisions by a majority vote of the members present and voting.
110:11 Effective Date. This act shall take effect 60 days after its passage.

Approved: May 15, 1996
Effective: July 14, 1996
LBAO
LSR 96-2555
9/13/95


FISCAL NOTE for an act relative to minimum bonding requirements for postsecondary institutions, the state share of default costs on certain federal student loans, and nursing service required for cancellation of nursing scholarship loan obligations.


FISCAL IMPACT:

The Postsecondary Education Commission has determined that this bill will have no fiscal impact on state, county and local revenues or expenditures.

METHODOLOGY:

The Commission states that failure to pass this bill could result in liability to the state between $50,000 and $200,000 per annum as a result of the state cost sharing initiative under the Higher Education Act of 1965, as amended.