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Introduced Version Senate Bill 373 History

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Key: Green = existing Code. Red = new code to be enacted
Senate Bill No. 373

(By Senators Tomblin (Mr. President) and Caruth,

By Request of the Executive)

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[Introduced February 25, 2009; referred to the Committee on Education; and then to the Committee on Finance.]

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A BILL to amend and reenact §18C-1-5 of the Code of West Virginia, 1931, as amended; and to amend and reenact §18C-7-3, §18C-7-4, §18C-7-5, §18C-7-6, §18C-7-7 and §18C-7-8 of said code, all relating to student financial aid resources and programs; reconstituting the Financial Aid Advisory Board; dissolving the PROMISE Scholarship Board and transferring its powers to the Higher Education Policy Commission; authorizing the Higher Education Policy Commission to invest certain funds with the West Virginia Investment Management Board; capping the maximum amount of the West Virginia Providing Real Opportunities for Maximizing In-State Student Excellence (PROMISE) scholarship annual award for certain students at the lesser of the cost of tuition at a state institution of higher education or $4,500; clarifying that a PROMISE scholarship may supplement certain tuition and fee waivers; and authorizing the Higher Education Policy Commission to promulgate rules.

Be it enacted by the Legislature of West Virginia:
That §18C-1-5 of the Code of West Virginia, 1931, as amended, be amended and reenacted; and that §18C-7-3, §18C-7-4, §18C-7-5, §18C-7-6, §18C-7-7 and §18C-7-8 of said code be amended and reenacted, all to read as follows:

ARTICLE 1. FINANCIAL ASSISTANCE GENERALLY.

§18C-1-5. Higher Education Student Financial Aid Advisory Board.

(a) The Higher Education Student Financial Aid Advisory Board is established.
(b) The purpose of the board is to provide financial aid expertise and policy guidance to the commission, the council, the PROMISE Scholarship Board, and the Vice Chancellor for Administration and the Executive Director of the PROMISE Scholarship Programs on all matters related to federal, state and private student financial aid resources and programs.
(c) It is the intent of the Legislature that the Advisory Board have the following responsibilities:
(1) Recommend methods to balance the needs of state students from all levels of financial need and academic ability by focusing attention on multiple financial aid programs which meet a variety of state objectives;
(2) Recommend methods for achieving a comprehensive system of student financial aid:
(A) To maximize the return on the state's investment in such programs by increasing the skills, qualifications and education achievement of the citizens receiving the benefits; and
(B) To establish methods for coordinating administration among state-funded student financial aid programs so that the state achieves the appropriate blend of student financial aid programs to expand the range of economic opportunities available to state citizens;
(d) The Advisory Board consists of twelve members as follows:
(1) The chair of the Higher Education Policy Commission or a designee who is a member of the commission;
(2) The chair of the West Virginia Council for Community and Technical College Education or a designee who is a member of the council;
(3) The State Superintendent of Schools or a designee;
(4) The Secretary of Education and the Arts or a designee;
(5) The State Treasurer or a designee;
(6) A member of the PROMISE Scholarship Board selected by that board;
(7) Three financial aid administrators, excluding the president of the West Virginia Association of Student Financial Aid Administrators.
(A) All financial aid administrators are appointed by the Vice Chancellor for Administration in consultation with the commission and the council, as appropriate. Of the initial appointments, the vice chancellor shall appoint one member to a two-year term, one member to a three-year term and one member to a four-year term. Thereafter, all terms are for four years.
(B) It is the duty of the Vice Chancellor for Administration to select financial aid administrators so that the following types of institutions have representatives serving on the board on a rotating basis:
(i) State institutions of higher education which are doctoral- degree granting research universities;
(ii) State institutions of higher education which primarily grant baccalaureate degrees;
(iii) State institutions of higher education which are free-standing community and technical colleges;
(iv) State institutions of higher education which are administratively linked community and technical colleges; and
(v) Private institutions of higher education which are regionally accredited and located within the state.
(8) Three at-large private sector members who are appointed jointly by the commission and the council. Of the initial appointments, the commission and the council jointly shall appoint one member to a two-year term, one member to a three-year term and one member to a four-year term. Thereafter, all terms are for four years.
(A) At-large members shall:
(i) Be representative of the state's business and economic community;
(ii) Demonstrate knowledge, skill and experience in an academic, business or financial field; and
(iii) Reside within this state.
(B) An at-large member may not be:
(i) A member of a governing board or institutional board of advisors of any public or private institution of higher education; nor
(ii) A publicly elected official or an employee of any state, county or municipal agency.
(e) No more than two of the at-large members may be from the same political party and no more than one may reside in any congressional district.
(1) After the initial appointments, each appointed member serves a term of four years and may be reappointed upon expiration of the term.
(2) In the event of a vacancy among appointed members, the commission and the council shall appoint a person for the remainder of the unexpired term to represent the same interests as those of the original appointee. A person appointed to fill a vacancy is eligible for reappointment. Unless a vacancy occurs due to death or resignation, an appointed member continues to serve until a successor has been appointed and qualified as provided in this section.
(d) The Advisory Board consists of eight members, as follows:
(1) Four members appointed by the Higher Education Policy Commission;
(2) Three members appointed by the West Virginia Council for Community and Technical College Education; and
(3) One member appointed by the West Virginia Independent Colleges and Universities.
(e) Each member appointed shall serve a term of four years. Of the members of the Advisory Board first appointed:
(1) The Higher Education Policy Commission shall appoint one member to a one-year term, one member to a two-year term, one member to a three-year term, and one member to a four-year term;
(2) The West Virginia Council for Community and Technical College Education shall appoint one member to a two-year term, one member to a three-year term and one member to a four-year term; and (3) The West Virginia Independent Colleges and Universities shall appoint one member to a four-year term.
(f) The first meeting of the Advisory Board shall be called by the Vice Chancellor for Administration, at which time the members shall elect a chairperson for a one-year term ending on June 30, 2010. The chairperson may serve no more than two consecutive terms as chair.
(g) In the event of a vacancy, a successor shall be appointed by the entity that appointed the vacating appointee for the unexpired term of the vacating appointee. A person appointed to fill a vacancy is eligible for reappointment. Unless a vacancy occurs due to death or resignation, an appointed member continues to serve until a successor has been appointed as provided in this section.
(f) (h) Members of the Advisory Board serve without compensation, but are entitled to reimbursement by the commission for expenses, including travel expenses, which are actually incurred by the member in the official conduct of the business of the advisory board. Members are shall be reimbursed in a manner consistent with rules of the Higher Education Policy Commission the guidelines of the Travel Management Office of the Department of Administration.
ARTICLE 7. WEST VIRGINIA PROVIDING REAL OPPORTUNITIES FOR
MAXIMIZING IN-STATE STUDENT EXCELLENCE SCHOLARSHIP PROGRAM.

§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 commission.
(b) "Board" means the West Virginia PROMISE Scholarship Board of the West Virginia PROMISE Scholarship Program as provided for in section four of this article. "Commission" means the West Virginia Higher Education Policy Commission established in article one-b, chapter eighteen-b of this code.
(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)(c) "Enrolled" means either currently enrolled or in the process of enrolling in an eligible institution.
(d) "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.
§18C-7-4. Dissolution of the PROMISE Scholarship Board; transfer of funds.

(a) The West Virginia PROMISE Scholarship Board is comprised of fifteen 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 the first day of April, two thousand seven, 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.
(a) The West Virginia PROMISE Scholarship Board is hereby dissolved.
(b) All funds administered by the former PROMISE Scholarship Board shall be administered by the Higher Education Policy Commission.

§18C-7-5. Powers and duties of the West Virginia Higher Education Policy Commission regarding the PROMISE Scholarship.

(a) Powers of board commission. -- In addition to the powers granted by any other provision of this article code, the board commission 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) (1) To propose promulgate 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) (2) To invest any of its funds at the board's discretion, the funds of the West Virginia PROMISE Scholarship Fund established in section seven of this article or the PROMISE Scholarship Supplemental Fund established in section eight of this article 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) (3) To execute contracts and other necessary instruments;
(5) (4) To impose reasonable requirements for residency for students applying for the PROMISE scholarship. 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 Exemption B subsection (c), section one, 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) (5) 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 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) (6) 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) (7) To define the terms and conditions under which scholarships are awarded with the minimum requirements being set forth in section six of this article; and
(9) (8) To establish other policies, procedures and criteria necessary to implement and administer the provisions of this article.
(b) Duties of board commission. -- In addition to any duty required by any other provision of this article code, the board commission 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 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 and to provide a written statement of intent to recipients who are selected to receive a PROMISE scholarship after the effective date of this section notifying them that acceptance of the scholarship entails a responsibility to supply:
(A) Information requested by the board commission 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 commission 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 annually to the Joint Standing Committee on Education by the tenth day of January, two thousand seven and annually thereafter Legislative Oversight Commission on Education Accountability; and
(B) Make recommendations annually to the Joint Standing Committee on Education Legislative Oversight Commission on Education Accountability regarding any actions the board commission considers necessary or expedient to encourage PROMISE recipients to live and work in the state after graduation. The findings and recommendations required by this subsection may be combined with a comprehensive report on other state financial aid programs and reported to the Legislative Oversight Commission on Education Accountability by an annual date established by that commission, notwithstanding dates for financial aid reports established elsewhere in this code.
§18C-7-6. Promise scholarship program requirements; legislative
rule.

(a) A PROMISE scholarship 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;
(1) For a student enrolled in a state institution of higher education, the annual award shall equal but not exceed the lesser of the cost of tuition or $4500: Provided, That if a student was awarded a PROMISE scholarship annual award prior to January 1, 2009, the annual award shall equal but not exceed the cost of tuition;
(2) For a student enrolled in an eligible institution that is not a state institution of higher education, the annual award shall equal but not exceed the lesser of the cost of tuition or $4500:
Provided, That if a student was awarded a PROMISE scholarship annual award prior to January 1, 2009, the annual award shall equal but not exceed the cost of tuition;
(3) Is The annual award shall be used by an eligible institution to supplement, but not to supplant, a tuition and fee waiver for which the individual is eligible pursuant to sections five, six-a, or seven or seven-b, article ten, chapter eighteen-b of this code.
(b) The total cost of all scholarships awarded by the board commission in any year may not exceed the amount of funds available to the board commission during that fiscal year.
(c) An individual shall meet the following conditions in order to be eligible to receive a PROMISE scholarship award:
(1) Submit a scholarship award application to the board commission:
(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 Exemption B subsection (c), section one, article eight, chapter eighteen 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 commission 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 commission, 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 commission 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 commission 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 award may retain and renew the scholarship 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 commission rules.
(7) It is the intent of the Legislature that the board commission shall strongly encourage prospective candidates for the PROMISE scholarship 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 award may not exceed the cost of tuition at state institutions of higher education;
(B) (A) The amount of a PROMISE scholarship 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) (B) Additional objective standards as the board commission 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) (C) Provisions for making the highest and best use of the PROMISE Scholarship Program in conjunction with the West Virginia Prepaid Tuition Trust Act West Virginia College Prepaid Tuition and Savings Program Act set forth in article thirty, chapter eighteen of this code;
(E) (D) A provision defining the relationship of PROMISE scholarship 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 awards not supplant tuition and fee waivers; and
(iii) Clarification of the relationship between the PROMISE Scholarship Program, tuition savings plans and other state funded student financial aid programs;
(F) (E) A method for awarding scholarships within the limits of available appropriations, including circumstances when program funds are not sufficient to provide awards to all eligible applicants. The board commission may not utilize any of the following methods:
(i) Making the Providing for an annual PROMISE scholarship award for an amount that is less than the cost of full tuition for a student enrolled in a state institution of higher education amounts provided for in this section; or
(ii) Eliminating any current recipient from eligibility; and
(G) (F) A method for applicants to appeal determinations of eligibility and renewal.
(2) The rule may provide for or require the following at the board's commission's discretion:
(A) Requiring repayment of the amount of the scholarship, in whole or in part, if a scholarship recipient chooses to work outside the state after graduation: Provided, That the rule may not require a recipient to repay a scholarship, in whole or in part, unless the prospective recipient has been informed of this requirement in writing before initial acceptance of the PROMISE scholarship award;
(B) Targeting a portion of the scholarship 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 award; and
(D) Providing additional criteria as determined by the board commission.
(3) The Legislature finds that an emergency exists and, therefore, the board commission 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 Scholarship Fund created.

(a) The special revenue fund in the State Treasury designated and known as the "PROMISE Scholarship Fund" is continued. 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 Fund;
(3) Any gifts, grants or contributions received for the PROMISE Scholarship 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 commission may expend the moneys in the fund to implement the provisions of this article.
§18C-7-8. PROMISE Scholarship Supplemental Fund recreated, and promulgation of rules.

(a) The Legislature recognizes that the PROMISE scholarship 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 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 commission 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 commission 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 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 cap the amount of a PROMISE scholarship annual award at the lesser of the cost of tuition at a state institution of higher education or $4500 for students receiving a PROMISE scholarship, to dissolve the PROMISE Board and transfer its powers to the Higher Education Policy Commission, and to reconstitute the Financial Aid Advisory Board.
Strike-throughs indicate language that would be stricken from the present law, and underscoring indicates new language that would be added.
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