H. B. 2599
(By Delegates Carmichael and Walters)
[Introduced February 18, 2009; referred to the
Committee on Education then Finance.]
A BILL to amend and reenact §18C-7-1, §18C-7-2, §18C-7-3, §18C-7-4,
§18C-7-5, §18C-7-6, §18C-7-7 and §18C-7-8 of the Code of West
Virginia, 1931, as amended, all relating to changing the
PROMISE Scholarship Program to the PROMISE Forgivable Student
Loan Program; and establishing deferment and forgiveness
conditions.
Be it enacted by the Legislature of West Virginia:
That §18C-7-1, §18C-7-2, §18C-7-3, §18C-7-4, §18C-7-5,
§18C-7-6, §18C-7-7 and §18C-7-8
of the Code of West Virginia, 1931,
as amended, be amended and reenacted, all to read as follows:
ARTICLE 7. WEST VIRGINIA PROVIDING REAL OPPORTUNITIES FOR
MAXIMIZING IN-STATE STUDENT EXCELLENCE FORGIVABLE
LOAN PROGRAM.
§18C-7-1. Title.
This article shall be known and may be cited as the "West Virginia providing real opportunities for maximizing in-state
student excellence (PROMISE) scholarship Forgivable Loan Program."
§18C-7-2. Legislative findings and purpose.
(a) The Legislature finds and declares that:
(1) West Virginia must have an educated work force in order to
attract and retain the high wage, high skill jobs of the
twenty-first century;
(2) A large percentage of West Virginia residents who graduate
from the state's colleges and universities do not work in the state
following graduation;
(3) The percentage of West Virginia's adult population over
the age of twenty-five with at least a baccalaureate degree is less
than fifteen percent and does not compare favorably with the member
states of the Southern Regional Education Board average nor with
the national average of twenty-five percent;
(4) Higher levels of education attainment result in higher
levels of personal income over a lifetime;
(5) Students who acquire a baccalaureate degree will earn an
estimated $1,000 more over their lifetimes than those who attain
only a high school diploma. This translates into an increased tax
base and economic development for West Virginia and more
discretionary income for its citizens;
(6) Students at all education levels should have an incentive
to perform at a high academic level;
(7) There is a need to provide parents with all tools possible
to aid them in helping their children understand the importance of
high academic achievement in high school and college;
(8) The PROMISE Scholarship Program is highly successful and
should be maintained as a forgivable loan program with merit as its
strongest component. The merit component:
(A) Provides an incentive for students to set high academic
standards in high school;
(B) Encourages students to increase their high school
achievement levels;
(C) Encourages students to enroll in more rigorous courses;
(D) Effects a culture change in West Virginia towards
increased education attainment;
(E) Results in improved ACT scores in the state since the
inception of the program; and
(F) Influences increased numbers of students, including those
students who are the highest academic achievers, to remain in West
Virginia to attend college.
(b) It is the purpose of this article to continue the West
Virginia PROMISE Scholarship Program as the West Virginia
Forgivable Loan Program to deal effectively with the findings set
forth in this section.
(c) Nothing in this article guarantees:
(1) A PROMISE scholarship award or any specific amount of a PROMISE scholarship award to any student; or
(2) That the requirements necessary for a student to qualify
for a PROMISE scholarship will not be changed by legislation or
rule before the student is eligible to receive an award.
§18C-7-3. Definitions.
(a) "Eligible institution" means:
(1) A state institution of higher education as defined in
section two, article one, chapter eighteen-b of this code;
(2) Alderson-Broaddus College, Appalachian Bible College,
Bethany College, Davis and Elkins College, Mountain State
University, Ohio Valley University, the University of Charleston,
West Virginia Wesleyan College and Wheeling Jesuit University, all
in West Virginia. Any institution listed in this subdivision
ceases to be an eligible institution if it:
(A) Loses regional accreditation; or
(B) Changes its status as a private, not for profit
institution.
(3) Any other regionally accredited institution in this state,
public or private, approved by the board.
(b) "Board" means the West Virginia PROMISE Scholarship
Forgivable Loan Board of the West Virginia PROMISE Scholarship
Forgivable Loan Program as provided for in section four of this
article.
(c) "Tuition" means the quarter, semester or term charges imposed by a state institution of higher education and all
mandatory fees required as a condition of enrollment by all
students.
(d) "Enrolled" means either currently enrolled or in the
process of enrolling in an eligible institution.
§18C-7-4. Appointment of the PROMISE Forgivable Loan Board;
compensation; proceedings generally.
(a) The West Virginia PROMISE Scholarship Forgivable Loan
Board is comprised of 15 members. Any member appointed by the
Governor prior to the effective date of this section may continue
to serve the term for which the member has been appointed:
Provided, That by April 1, 2007, and thereafter, the membership of
the board is comprised as follows:
(1) The chairperson of the commission or a designee who is a
member of the commission;
(2) The chancellor of the commission or his or her designee;
(3) The State Superintendent of Schools or his or her
designee;
(4) The Secretary of Education and the Arts;
(5) The State Treasurer or his or her designee;
(6) The President of the West Virginia Association of Student
Financial Aid Administrators;
(7) The Executive Director of the Governor's Workforce
Investment Division;
(8) Eight at-large members, appointed by the Governor with the
advice and consent of the Senate:
(A) One of the eight at-large members has knowledge, skill and
expertise in state and federal student financial aid policy and
management;
(B) Seven of the eight at-large members represent the state's
business and economic community and have knowledge, skill and
experience in an academic, business or financial field.
(C) The eight at-large members shall be residents of the
state. No more than five of the eight at-large members may be from
the same political party. No more than three of the eight at-large
members may be from the same congressional district.
(b) At-large members serve a term of four years and may be
reappointed at the expiration of their terms. In the event of a
vacancy among at-large members, the Governor shall appoint a person
representing the same interests to fill the unexpired term. A
person appointed to fill a vacancy shall be appointed only for the
remainder of that term and is eligible for reappointment. Unless
a vacancy occurs due to death, resignation or removal pursuant to
subsection (e) of this section, an at-large member of the board
shall continue to serve until a successor has been appointed and
qualified as provided in subsection (a) of this section. All terms
are for four years.
(c) Members of the board shall serve without compensation, but shall be reimbursed by the Office of the Secretary of Education and
the Arts for expenses, including travel expenses, actually incurred
by a member in the official conduct of the business of the board at
the same rate as is paid the employees of the state.
(d) The Secretary of Education and the Arts is the chairperson
and presiding officer of the board. A majority of the members of
the board constitute a quorum for the transaction of business.
(e) The at-large members appointed by the Governor may be
removed by the Governor for official misconduct, incompetence,
neglect of duty or gross immorality and then only in the manner
prescribed by law for the removal by the Governor of the state
elective officers in accordance with section five, article six,
chapter six of this code.
§18C-7-5. Powers and duties of the West Virginia PROMISE
Forgivable Loan Board.
(a) Powers of board. --
In addition to the powers granted by any other provision of
this article, the board has the powers necessary or convenient to
carry out the purposes and provisions of this article including,
but not limited to, the following express powers:
(1) To adopt and amend bylaws;
(2) To propose legislative rules to the commission for
promulgation in accordance with the provisions of article three-a,
chapter twenty-nine-a of this code to effectuate the purposes of this article;
(3) To invest any of its funds at the board's discretion, with
the West Virginia Investment Management Board in accordance with
the provisions of article six, chapter twelve of this code. Any
investments made under this article shall be made with the care,
skill, prudence and diligence under the circumstances then
prevailing that a prudent person acting in a like capacity and
familiar with such matters would use in the conduct of an
enterprise of a like character and with like aims. Fiduciaries
shall diversify plan investments to the extent permitted by law so
as to minimize the risk of large losses, unless under the
circumstances it is clearly prudent not to do so;
(4) To execute contracts and other necessary instruments;
(5) To impose reasonable requirements for residency for
students applying for the PROMISE scholarship Forgivable Loan.
Except as provided in section four, article one of this chapter,
the requirements shall include that an eligible student must have
met the following requirements:
(A) Completed at least one half of the credits required for
high school graduation in a public or private high school in this
state; or
(B) Received instruction in the home or other approved place
pursuant to section one-b, article eight, chapter eighteen of this
code for the two years immediately preceding application.
(C) This subdivision may not be construed to establish
residency requirements for matriculation or fee payment purposes at
state institutions of higher education;
(6) To contract for necessary goods and services, to employ
necessary personnel and to engage the services of private persons
for administrative and technical assistance in carrying out the
responsibilities of the scholarship Forgivable Loan Program;
(A) The board is encouraged to utilize the employees of the
Vice Chancellor for Administration to provide administrative and
technical assistance.
(B) Any services provided for the board by such employees
remain under the direction and authority of the vice chancellor.
(7) To solicit and accept gifts, including bequests or other
testamentary gifts made by will, trust or other disposition,
grants, loans and other aid from any source and to participate in
any federal, state or local governmental programs in carrying out
the purposes of this article;
(8) To define the terms and conditions under which
scholarships forgivable loans are awarded with the minimum
requirements being set forth in section 6 of this article; and
(9) To establish other policies, procedures and criteria
necessary to implement and administer the provisions of this
article.
(b) Duties of board. --
In addition to any duty required by any other provision of
this article, the board has the following responsibilities:
(1) To operate the program in a fiscally responsible manner
and within the limits of available funds;
(2) To operate the PROMISE Scholarship Forgivable Loan Program
as a merit-based program;
(3) To raise academic eligibility requirements before taking
any other steps to limit student awards should projections indicate
that available funds will not be sufficient to cover future costs;
and
(4) To maintain contact with graduates who have received
PROMISE scholarships forgivable loans and to provide a written
statement of intent to recipients who are selected to receive a
PROMISE scholarship Forgivable Loan after the effective date of
this section notifying them that acceptance of the scholarship
forgivable loan entails a responsibility to supply:
(A) Information requested by the board to determine the number
and percentage of recipients who:
(i) Continue to live in West Virginia after graduation;
(ii) Obtain employment in West Virginia after graduation; and
(iii) Enroll in post-graduate education programs and the name
of the state in which each post-graduate institution is located;
and
(B) Such other relevant information as the board may reasonably request to implement the provisions of this subdivision.
(5) To analyze the data collected pursuant to subdivision (4)
of this subsection, and:
(A) Report the findings to the Joint Standing Committee on
Education by January 10, 2007, and annually thereafter; and
(B) Make recommendations annually to the Joint Standing
Committee on Education regarding any actions the board considers
necessary or expedient to encourage PROMISE forgivable loan
recipients to live and work in the state after graduation.
§18C-7-6. PROMISE Forgivable Loan Program requirements;
legislative rule.
(a) A PROMISE scholarship Forgivable Loan annual award meets
the following conditions:
(1) Equals but does not exceed the cost of tuition for a
student enrolled in a state institution of higher education;
(2) Equals an amount determined by the board, but not to
exceed the cost of tuition at state institutions of higher
education, for a student enrolled in an eligible institution that
is not a state institution of higher education; and
(3) Is used by an eligible institution to supplement, but not
to supplant, a tuition and fee waiver for which the individual is
eligible pursuant to section five, six or seven, article ten,
chapter eighteen-b of this code.
(b) The total cost of all scholarships forgivable loans awarded by the board in any year may not exceed the amount of funds
available to the board during that fiscal year.
(c) An individual shall meet the following conditions in order
to be eligible to receive a PROMISE scholarship Forgivable Loan
award:
(1) Submit a scholarship forgivable loan award application to
the board:
(A) Within two years of graduating from high school or within
two years of acquiring a General Equivalency Degree if provided
instruction in the home or other approved place pursuant to section
five, six or seven, article ten, chapter eighteen-b of this code;
or
(B) Within seven years of initially entering military service,
and within one year of discharge from such military service, if the
individual has entered the United States armed services within two
years after graduating from high school;
(2) Apply for and submit to the board a free application for
Federal Student Aid;
(3) Maintain a grade point average of at least 3.0 on a 4.0
grading scale in the required core and elective course work
necessary to prepare students for success in post-secondary
education at the associate and baccalaureate degree levels as
determined by the board, if the individual has completed not more
than one semester or term at an institution of higher education, excluding credits earned in advanced placement, international
baccalaureate, dual credit and comparable courses while the student
is enrolled in high school;
(4) Maintain appropriate academic progress toward the
completion of a degree at the undergraduate education level as
determined by the board if the individual has completed more than
one semester or term at an institution of higher education,
excluding credits earned in advanced placement, international
baccalaureate, dual credit and comparable courses while the student
is enrolled in high school;
(5) Meet additional objective standards as the board considers
necessary to promote academic excellence and to maintain the
financial stability of the fund;
(6) Enroll in an eligible institution. Any student enrolled
at an eligible institution who receives a PROMISE scholarship
Forgivable Loan award may retain and renew the scholarship
Forgivable Loan to complete his or her undergraduate education at
that institution, or any other eligible institution:
(A) If the institution at which the student is enrolled loses
its status as an eligible institution pursuant to the provisions of
subdivision (2), subsection (a), section three of this article; and
(B) If the student meets all other renewal requirements of
this code and of board rules.
(7) It is the intent of the Legislature that the board shall strongly encourage prospective candidates for the PROMISE
scholarship Forgivable Loan to perform at least twenty hours of
unpaid community service while in high school to help prepare them
for success in post-graduate education. The community service may
include, but is not limited to, participation with nonprofit,
governmental or community-based organizations designed to:
(A) Improve the quality of life for community residents;
(B) Meet the needs of community residents; or
(C) Foster civic responsibility.
(d) The board shall recommend a legislative rule to the
commission to implement the provisions of this article. The
commission shall promulgate a legislative rule in accordance with
the provisions of article three-a, chapter twenty-nine-a of this
code.
(1) The rule shall include at least the following provisions:
(A) The amount of a PROMISE scholarship Forgivable Loan award
may not exceed the cost of tuition at state institutions of higher
education;
(B) The amount of a PROMISE scholarship Forgivable Loan award
in combination with aid from all other sources may not exceed the
cost of education at the institution the recipient is attending.
This provision does not apply to members of the West Virginia
National Guard, recipients of an Underwood-Smith teacher
scholarship, and recipients of a West Virginia engineering, science and technology scholarship;
(C) Additional objective standards as the board considers
necessary:
(i) To promote academic excellence;
(ii) To maintain the financial stability of the fund; and
(iii) To operate the program within the limits of available
funds.
(D) Provisions for making the highest and best use of the
PROMISE Scholarship Forgivable Loan Program in conjunction with the
West Virginia Prepaid Tuition Trust Act set forth in article
thirty, chapter eighteen of this code;
(E) A provision defining the relationship of PROMISE
scholarship Forgivable Loan awards to all other sources of student
financial aid to ensure maximum coordination. The provision shall
include the following:
(i) Methods to maximize student eligibility for federal
student financial aid;
(ii) A requirement that PROMISE scholarship Forgivable Loan
awards not supplant tuition and fee waivers; and
(iii) Clarification of the relationship between the PROMISE
Scholarship Forgivable Loan Program, tuition savings plans and
other state funded student financial aid programs;
(F) A method for awarding scholarships forgivable loans within
the limits of available appropriations, including circumstances when program funds are not sufficient to provide awards to all
eligible applicants. The board may not utilize any of the
following methods:
(i) Making a scholarship Forgivable Loan award for an amount
less than the cost of full tuition for a student enrolled in a
state institution of higher education; or
(ii) Eliminating any current recipient from eligibility;
(G) A method for applicants to appeal determinations of
eligibility and renewal.
(H)
A determination to permit forgivable loan recipients to
defer repayment of the amount of their forgivable loans, in whole
or in part, as long as they are enrolled in and successfully
completing a course of study in an eligible institution or if they
choose to work inside the state after graduation and file a West
Virginia resident personal income tax return. If a graduate lives
and works in this state for four years after graduation, the total
amount of the forgivable loan shall be forgiven;
(2) The rule may provide for or require the following at the
board's discretion:
(A) Requiring repayment of the amount of the scholarship
Forgivable Loan, in whole or in part, if a scholarship recipient
chooses to work outside the state after graduation: Provided, That
rule may not require a recipient to repay a scholarship Forgivable
Loan, in whole or in part, unless the prospective recipient has been informed of this requirement in writing before initial
acceptance of the PROMISE scholarship Forgivable Loan award.
(B) Targeting a portion of the scholarship Forgivable Loan
funds to be used for applicants enrolled in an engineering,
science, technology or other designated program;
(C) Determining what other sources of funding for higher
education are to be deducted from the PROMISE scholarship
Forgivable Loan award; and
(D) Providing additional criteria as determined by the board.
(3) The Legislature finds that an emergency exists and,
therefore, the board shall file a rule to implement the provisions
of this section as an emergency rule pursuant to the provisions of
article three-a, chapter twenty-nine-a of this code. The rule is
subject to the prior approval of the Legislative Oversight
Commission on Education Accountability.
§18C-7-7. West Virginia PROMISE Forgivable Loan Fund created.
(a) The special revenue fund in the State Treasury designated
and known as the "PROMISE Scholarship Fund" is continued as the
"Forgivable Loan Fund". The fund consists of:
(1) All appropriations to the fund from the West Virginia
lottery, video lottery and taxes on amusement devices;
(2) All appropriations by the Legislature for the PROMISE
Scholarship Forgivable Loan Fund;
(3) Any gifts, grants or contributions received for the PROMISE Scholarship Forgivable Loan Program; and
(4) All interest or other income earned from investment of the
fund.
(b) The allocations to the fund are subject to appropriation
by the Legislature. Nothing in this article requires any specific
level of funding by the Legislature nor guarantees nor entitles any
individual to any benefit or grant of funds.
(c) For the fiscal year beginning July 1, 2006, it is the
intent of the Legislature that the aggregate of the amount of
moneys transferred to the fund pursuant to section eighteen-a,
article twenty-two, chapter twenty-nine of this code and such other
amounts of public moneys that may be transferred to the fund by
appropriation of the Legislature, shall equal but may not exceed
$40 million. For each fiscal year thereafter until and including
the fiscal year ending June 30, 2011, it is the intent of the
Legislature that this aggregate be an amount two percent greater
than the aggregate established by this subsection for the prior
fiscal year. For the fiscal year beginning July 1, 2011, and in
each fiscal year thereafter, it is the intent of the Legislature
that this aggregate not exceed the aggregate established by this
subsection for the fiscal year beginning July 1, 2011.
(d) The board may expend the moneys in the fund to implement
the provisions of this article.
§18C-7-8. PROMISE Forgivable Loan Supplemental Fund recreated, and promulgation of rules.
(a) The Legislature recognizes that the PROMISE scholarship
Forgivable Loan program may lead to an increased number of
individuals attending the state institutions of higher education,
and therefore, it may contribute to increases in expenses greater
than the additional tuition income generated by increased
enrollment. Therefore, there is hereby created a special revenue
fund in the State Treasury which shall be designated and known as
the "PROMISE scholarship Forgivable Loan Supplemental Fund." The
fund shall consist of all appropriations to the fund and all
interest earned from the investment of the fund and any gifts,
grants or contributions received by the fund. The board shall
expend the moneys in this fund to implement the provisions of this
article and may only expend the moneys for state institutions of
higher education.
(b) The board shall promulgate rules for administering the
fund in accordance with article three-a, chapter twenty-nine-a of
this code. The rules shall include the following:
(1) Provisions for distributing the moneys from the fund to
state institutions of higher education: Provided, That the funds
shall be divided among the state institutions of higher education
in a reasonable manner to reflect the actual distribution of
PROMISE scholarship Forgivable Loan students among the
institutions; and
(2) A procedure for submitting a budget request to the
Governor: Provided, That nothing in this article shall require any
appropriation by the Legislature.
NOTE: The purpose of this bill is to change the PROMISE
Scholarship Program to the PROMISE Forgivable Student Loan Program
and to establish deferment and forgiveness conditions.
Strike-throughs indicate language that would be stricken from
the present law, and underscoring indicates new language that would
be added.