Illinois General Assembly - Full Text of SB1698
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Full Text of SB1698  96th General Assembly


Higher Education Committee

Filed: 5/6/2009





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2     AMENDMENT NO. ______. Amend Senate Bill 1698 by replacing
3 everything after the enacting clause with the following:
4     "Section 1. Short title. This Act may be cited as the Task
5 Force on Higher Education Private Student Loans.
6     Section 5. Legislative findings. The General Assembly
7 makes all of the following findings:
8         (1) Today, private loans constitute 20% of total
9     education loan money, whereas 10 years ago private loans
10     constituted 5% of student loans.
11         (2) Tuition at public universities has risen 57% in the
12     past 5 years.
13         (3) Between 2000-2001 and 2005-2006, private student
14     loan volume grew at an average rate of 27% to a total of
15     $17.3 billion.
16         (4) Borrowers who do not complete their degrees are 10



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1     times as likely to default on their loan and twice as
2     likely to be unemployed.
3         (5) Predatory and subprime lending practices have
4     caused a crisis in the housing and real estate industry,
5     and it is the interest of all parties involved to avoid a
6     similar crisis involving private student loans.
7     Section 10. Creation of Task Force. There is created the
8 Task Force on Higher Education Private Student Loans consisting
9 of all of the following members:
10         (1) One member each appointed by the President of the
11     Senate, the Minority Leader of the Senate, the Speaker of
12     the House of Representatives, and the Minority Leader of
13     the House of Representatives.
14         (2) One member appointed by the executive director of
15     the Illinois Student Assistance Commission to serve as
16     chairperson of the Task Force.
17         (3) One member appointed by the Attorney General.
18         (4) Members appointed by the Governor as follows:
19             (A) One member representing a banking
20         organization.
21             (B) One member representing private schools and
22         universities.
23             (C) One member representing a student loan
24         corporation.
25         (5) The executive director of the Board of Higher



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1     Education or his or her designee.
2         (6) The State Treasurer or his or her designee to serve
3     as the co-chairperson of the Task Force.
4         (7) The Director of the Division of Financial
5     Institutions of the Department of Financial and
6     Professional Regulation or his or her designee.
7     Section 15. Duties. The duties of the Task Force on Higher
8 Education Private Student Loans shall include without
9 limitation all of the following:
10         (1) To investigate the rates, fees, and terms
11     associated with private student loans made to students in
12     this State.
13         (2) To investigate how rates, fees, and terms impact
14     the accessibility of private student loans, affordability
15     of student loans, and choice of institution students have.
16         (3) To investigate the impact rates, fees, and terms
17     have on students after graduation, specifically the
18     following:
19             (A) The amount of debt they carry.
20             (B) The impact on pursuing post-graduate degrees.
21             (C) The ability to repay their loans.
22         (4) To investigate the relationship between rising
23     tuition and the availability of private loans.
24         (5) To assess the impact of capping private student
25     loan fees charged by lenders.



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1         (6) To investigate how many private student loans are
2     in default or are not able to be repaid.
3         (7) To investigate what rates, fees, and terms are
4     common to those private student loans in default.
5         (8) To assess what impact loan defaults have on lending
6     institutions.
7         (9) To assess the impact a loan default has on the
8     borrower.
9         (10) To study what additional disclosures can be made
10     to students regarding high risk loans, financial
11     information, financial choices, and financial aid
12     available.
13         (11) To investigate what higher education institutions
14     can do to advise students on their financial aid and loan
15     resources.
16         (12) To investigate if race and ethnicity are a factor
17     in the rates, fees, and terms associated with private
18     student loans.
19     Section 20. Task Force assistance. The Office of the
20 Illinois Student Assistance Commission shall be responsible
21 for administrative and logistical support of the Task Force on
22 Higher Education Private Student Loans, including coordination
23 of Task Force member appointments, distribution of meeting
24 notices and minutes, coordination of meeting logistics,
25 facilitation of public meetings, and the drafting and filing of



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1 the report under Section 25 of this Act. Task Force members or
2 staff liaisons or both may confer and collaborate with relevant
3 State and national organizations with expertise.
4     Section 25. Report; dissolution of Task Force. The Task
5 Force on Higher Education Private Student Loans shall report
6 its findings and recommendations to the General Assembly by
7 filing copies of its report by December 31, 2010 as provided in
8 Section 3.1 of the General Assembly Organization Act. Upon
9 filing this report the Task Force is dissolved.
10     Section 90. Expiration of Act. This Act is repealed on
11 January 1, 2011.".