Full Text of HB1311 99th General Assembly
HB1311ham001 99TH GENERAL ASSEMBLY | Rep. Jack D. Franks Filed: 3/23/2015
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| 1 | | AMENDMENT TO HOUSE BILL 1311
| 2 | | AMENDMENT NO. ______. Amend House Bill 1311 by replacing | 3 | | everything after the enacting clause with the following:
| 4 | | "Section 1. Short title. This Act may be cited as the | 5 | | Affordable College Financing Pilot Program Act. | 6 | | Section 5. Findings.
The General Assembly finds that many | 7 | | students and families struggle to afford the costs of college | 8 | | despite the programs available to assist them. Grant assistance | 9 | | and federal student loans, while offering critical financial | 10 | | support for students, are often insufficient to cover the full | 11 | | cost of attendance, particularly at the university level. In | 12 | | order to make State universities more accessible to Illinois | 13 | | students and to temper the challenges associated with student | 14 | | debt, the General Assembly hereby establishes a pilot, | 15 | | income-based student loan program to finance costs of | 16 | | attendance that are not funded by grants or federal student aid |
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| 1 | | and that exceed a family's ability to pay. The loan is intended | 2 | | to be repaid on a schedule designed to be affordable for the | 3 | | borrower, with payments based on the borrower's income.
| 4 | | Section 10. Definitions. In this Act: | 5 | | "Borrower" means a person who has been awarded and accepts | 6 | | a program loan under this Act. | 7 | | "Cost of attendance" means the cost of attending a State | 8 | | university. | 9 | | "Commission" means the Illinois Student Assistance | 10 | | Commission. | 11 | | "Eligible student" means a person who is a resident of this | 12 | | State and has been accepted to or is enrolled in a State | 13 | | university and who has remaining need, as defined in this | 14 | | Section. | 15 | | "Expected family contribution" is the federally determined | 16 | | share of family income that can be expected to be used for | 17 | | college. | 18 | | "Fund" means the Affordable College Financing Pilot | 19 | | Program Fund. | 20 | | "Program" means the pilot program established under this | 21 | | Act. | 22 | | "Program loan" means a loan awarded by the Commission to an | 23 | | eligible student under the program. | 24 | | "Remaining need" is defined as the part of the cost of | 25 | | attendance not covered by the expected family contribution, |
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| 1 | | grants, or federal Stafford loans. | 2 | | Section 15. Pilot program.
| 3 | | (a) Subject to the appropriation of funds for this purpose, | 4 | | the Commission shall implement and administer a pilot program | 5 | | to provide loans to 400 eligible students under this Act. The | 6 | | Commission shall conduct a lottery to determine which qualified | 7 | | applicants are to be awarded program loans in accordance with | 8 | | this Act. The lottery will be based on a stratified random | 9 | | sample to ensure equal participation by students in each of the | 10 | | 4 lower-income quintiles that are based on Illinois income data | 11 | | reported annually by the U.S. Census Bureau. Once a student has | 12 | | gained entry into the program, the loans will be available | 13 | | annually, as needed, for 4 years. These program loans are to be | 14 | | repaid, beginning 6 months after the borrower leaves school, on | 15 | | a schedule that is based on the income of the borrower. | 16 | | (b) The Affordable College Financing Pilot Program Fund is | 17 | | created as a special fund in the State treasury. All money in | 18 | | the Fund shall be used, subject to appropriation, by the | 19 | | Commission for awarding program loans and administering the | 20 | | program under this Act. The Fund shall consist of the repayment | 21 | | of program loans, interest earned on the moneys in the Fund, | 22 | | and other funds appropriated or made available to the Fund. | 23 | | (c) An eligible student must complete the Free Application | 24 | | for Federal Student Aid in order to apply for a program loan. | 25 | | The Commission may additionally develop and require a separate |
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| 1 | | application for a program loan. The program loan application | 2 | | shall be in such form as required by the Commission and shall | 3 | | include such information as required by the Commission. The | 4 | | Commission shall review the application and, if satisfied that | 5 | | the applicant is an eligible student and is not ineligible for | 6 | | loan assistance under subsections (a) and (b) of Section 35 of | 7 | | the Higher Education Student Assistance Act, shall award a | 8 | | program loan to the applicant if selected by lottery. Loans may | 9 | | be issued only from available funds. | 10 | | (d) The amount of a program loan shall be sufficient to | 11 | | cover the student's remaining need, as defined in Section 10. | 12 | | (e) The Commission may not charge interest on a program | 13 | | loan, but may charge a default insurance premium as provided in | 14 | | subsection (f) of this Section. | 15 | | (f) By accepting a program loan, an eligible student shall | 16 | | agree to repay the amount of the program loan, plus a default | 17 | | insurance premium amount to be determined by the Commission,
| 18 | | subject to the following: | 19 | | (1) Repayment shall commence not later than 6 months | 20 | | after the eligible student leaves the State university. The | 21 | | Commission may establish rules for deferment and | 22 | | forbearance consistent with federal guidelines. | 23 | | (2) The monthly amount required to be repaid shall be | 24 | | based on a repayment schedule that the Commission shall by | 25 | | rule develop and shall be based on a percentage of the
| 26 | | borrower's adjusted gross income. |
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| 1 | | (3) Monthly payments shall continue until the borrower | 2 | | has fully paid the amount of the program loan and the | 3 | | default insurance premium amount. | 4 | | (g) To administer the program, the Commission may exercise | 5 | | the same powers of collection as otherwise authorized by law. | 6 | | (h) The Commission shall forgive the repayment of a program | 7 | | loan if the borrower dies or becomes disabled. | 8 | | (i) The Commission may establish and administer, or | 9 | | contract with a third party to do so, a default insurance plan | 10 | | for program loans in which eligible students have defaulted on
| 11 | | repayment of their program loans. | 12 | | Section 20. Progress reports. The Commission shall submit | 13 | | a progress report to the General Assembly 2 years after | 14 | | implementation of the program and 4 years after implementation
| 15 | | of the program. The report shall describe the financial | 16 | | stability of the Fund and student success metrics utilized, | 17 | | both for initial loan awards and loan continuances within the | 18 | | program. The Commission shall track average cumulative debt and | 19 | | year-to-year student retention, and compare these numbers to a | 20 | | control group of similar students not participating in the | 21 | | program. The Commission shall also track and report the | 22 | | progress of borrowers throughout the repayment period. | 23 | | Section 90. Rules. The Commission may adopt any rules
| 24 | | necessary to carry out its responsibilities under this Act.
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| 1 | | Section 95. The State Finance Act is amended by adding | 2 | | Section 5.866 as follows: | 3 | | (30 ILCS 105/5.866 new) | 4 | | Sec. 5.866. The Affordable College Financing Pilot Program | 5 | | Fund.
| 6 | | Section 99. Effective date. This Act takes effect upon | 7 | | becoming law.".
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