2015 -- H 5226

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LC000826

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2015

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A N   A C T

RELATING TO EDUCATION - GET ON YOUR FEET LOAN FORGIVENESS PROGRAM

     Introduced By: Representatives Shekarchi, Kennedy, Regunberg, Tanzi, and Ruggiero

     Date Introduced: January 29, 2015

     Referred To: House Finance

     (by request)

It is enacted by the General Assembly as follows:

     SECTION 1. Title 16 of the General Laws entitled "EDUCATION" is hereby amended

by adding thereto the following chapter:

CHAPTER 62.2.

THE GET ON YOUR FEET LOAN FORGIVENESS PROGRAM

     16-62.2-1. Short title. -- This chapter shall be known and may be cited as "The Get on

Your Feet Loan Forgiveness Program."

     16-62.2-2. Legislative findings and purpose. -- (a) Studies show that students who

graduate with high debt from loans for higher education are less likely to start a small business, or

a family, or to purchase a home, and the consequences of defaulting on student loans can prevent

a person from ever realizing their goals. Managing the burden in the first years out of college is

crucial to starting out strong. Helping students at the start can have lasting effects.

     (b) The get on your feet loan forgiveness program is designed to help eligible Rhode

Island state residents who graduate from post-secondary educational institutions and continue to

live in the state to pay nothing on their student loans for the first two (2) years out of school. This

will supplement the federal Pay As You Earn (PAYE) income-based loan repayment program.

     (c) As used in this chapter, the term "program" shall refer to the get on your feet loan

forgiveness program, except where the context clearly indicates otherwise.

     16-16.2-3. Program provisions. -- For an individual who meets the requirements

established in this chapter, the state of Rhode Island will pay the difference between what the

federal government covers and the individual's total loan payment. The state will ensure that one

hundred percent (100%) of a graduate's loan payments for the first two (2) years are covered so

they are not overwhelmed with debt repayments while working to get situated in today's

competitive job market. The program shall be administered through the Rhode Island student loan

authority established pursuant to chapter 62 of title 16.

     16-62.2-4. Program requirements. -- (a) To be eligible for participation in the get on

your feet loan forgiveness program, a student must:

      (1) Attend a college or university in Rhode Island for at least two (2) years and graduate

from said college or university;

     (2) Continue to reside in the state following graduation from said college for a period of

at least two (2) years following graduation and at all times while the person is participating in the

program;

     (3) Participate in the federal Pay as You Earn Repayment Program (PAYE), 20 U.S.C. §

1098 e (e); and

     (4) Earn less than fifty thousand dollars ($50,000) annually for each calendar year in

which a student must repay his or her student loans.

      (b) Any person who obtains a deferment on the payment of a student loan shall not be

entitled to participate in the get on your feet loan forgiveness program for so long as said

deferment is in effect.

     16-62.2-5. Application and continued eligibility. -- (a) Application. Any individual

seeking to participate in the program pursuant to the provisions of this chapter shall apply to the

Rhode Island student loan authority on forms prescribed by the authority containing any

information that the authority deems advisable to fulfill the provisions of this program. The

authority's executive director, or his or her designee, shall determine the eligibility of each

applicant.

     (b) Continued eligibility. – Any individual deemed eligible to participate in the program

shall not less than annually submit to the authority any information that the authority may

prescribe to determine the individual's continued eligibility for the program in regard to his or

her eligible loan(s).

     (c) Penalty for failure to maintain eligibility. – In the event the authority determines that

an individual is no longer eligible for the participation in the program as provided in this chapter,

that individual shall be required to pay the holder of his or her loan forthwith all accrued

principal, interest, and any late payment penalties which have accrued during the period of the

ineligibility.

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     16-62.2-6. Regulations. -- The authority may promulgate any rules and regulations that it

deems necessary to implement the provisions of the program established pursuant to this chapter.

     16-62.2-7. Severability of provisions. -- The provisions of this chapter are severable. If

any provisions are deemed invalid by a court of competent jurisdiction, that determination shall

not affect the validity of the remaining provisions.

     SECTION 2. This act shall take effect upon passage

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO EDUCATION - GET ON YOUR FEET LOAN FORGIVENESS PROGRAM

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     This act would establish "The Get On Your Feet Loan Forgiveness Program" in Rhode

Island, to assist recent college and university graduates in the repayment of their student loans.

     This act would take effect upon passage.

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