Report Title:

UH; Loan Repayments

 

Description:

Establishes the Hawaii Medical Doctor Loan Repayment Program for University of Hawaii medical school graduates and medical school graduates with training from Hawaii based medical program working in rural areas of the state.  (HB991 HD2)

 


HOUSE OF REPRESENTATIVES

H.B. NO.

991

TWENTY-FIFTH LEGISLATURE, 2009

H.D. 2

STATE OF HAWAII

 

 

 

 

 

 

A BILL FOR AN ACT


 

 

RELATING TO THE UNIVERSITY OF HAWAII.

 

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

 


     SECTION 1.  Chapter 304A, Hawaii Revised Statutes, is amended by adding a new subpart to part II to be appropriately designated and to read as follows:

"   .  HAWAII MEDICAL DOCTOR LOANS

     §304A-A  Hawaii medical doctor loans; eligibility; amounts.  There is created the Hawaii medical doctor loan program to be administered by the University of Hawaii, to provide financial support to:

(1)  Students who complete a state-approved medical school program at the University of Hawaii; or

(2)  Graduates of a medical school who have received medical training from a Hawaii-based medical program,

and who agree to practice in rural areas of the state, as designated by the University of Hawaii.  Loans shall be awarded by the university to students on a competitive basis.  The amount to be loaned to a student shall be determined by the board of regents based upon need for financial aid and proof of acceptance into a state-approved medical school program at the university.  The maximum aggregate amount of loans that a student may receive under this program shall be an amount equivalent to tuition payments and costs of textbooks and other instructional and laboratory materials necessary to complete a state-approved medical school program.

     §304A-B  Repayment of loans; late fees; rural area practice and loan repayment waiver; collection agency.  (a)  All loans made under this subpart shall bear interest at five per cent simple interest.  Repayment of principal and interest shall commence one year after graduation or three months after a loan recipient ceases to:

(1)  Be enrolled in a state-approved medical school program at the university; or

(2)  Receive medical training from a Hawaii-based medical program, and

shall be paid in periodic installments within a six-year period.

     (b)  The university shall charge late fees and all other reasonable costs for the collection of delinquent loans.

     (c)  Upon a showing of proof that the loan recipient has completed a state-approved medical school program or has received medical training from a Hawaii-based medical program and is practicing as a medical doctor in a rural area of the state, as designated by the university, one-tenth of the total amount of the loan and interest shall be waived for every year of the first five years, and the remaining balance shall be waived after the sixth year that a loan recipient practices medicine in a rural area of the state, as designated by the University of Hawaii.

     (d)  Once a loan recipient subject to this section fails to practice medicine in a rural area of the state, as designated by the university, for a minimum of ten consecutive years from the loan recipient's original date of employment, excluding temporary leaves of absence, then the university shall withdraw its waiver of future repayments, and the loan recipient shall repay any remaining loan balance at the rate of ten per cent simple interest.

     (e)  In accordance with chapter 103D, the university shall enter into written contracts with collection agencies for the purpose of collecting delinquent student loans.  All payments collected, including late fees and all other reasonable costs, exclusive of a collection agency's commissions, shall revert and be credited to the Hawaii medical doctor loan program revolving fund.  A collection agency that enters into a written contract with the university for the collection of delinquent student loans, pursuant to this section, shall collect a commission from the debtor in accordance with the terms of, and up to the amounts authorized in, the written contract.

     (f)  Liability for repayment of a loan shall be canceled upon the death or permanent total disability of the loan recipient.

     §304A-C  Capacity of minors in qualifying for Hawaii medical doctor loans.  Any student otherwise qualifying for a loan under the Hawaii medical doctor loan program shall not be disqualified because the student is under the age of eighteen years, and for the purpose of applying for, receiving, and repaying the loan, the student shall be deemed to have full legal capacity to act and shall have all rights, powers, privileges, and obligations of an adult with respect thereto.

     §304A-D  Rules governing Hawaii medical doctor loan program.  The university may adopt rules to implement the Hawaii medical doctor loan program.  The rules shall be adopted pursuant to chapter 91 but shall be exempt from the public notice and public hearing requirements.

     §304A-E  Hawaii medical doctor loan program revolving fund.  There is established a revolving fund to be known as the Hawaii medical doctor loan program revolving fund.  The fund shall be a revolving fund and all interest and payments received on account of principal shall be credited to the fund.  The fund shall be administered by the board of regents and shall be disbursed to qualified students who meet eligibility requirements under section 304A-A pursuant to rules adopted by the board."

     SECTION 2.  There is appropriated out of the general revenues of the State of Hawaii the sum of $           or so much thereof as may be necessary for fiscal year 2009-2010 and the same sum or so much thereof as may be necessary for fiscal year 2010-2011 for deposit into the Hawaii medical doctor loan program revolving fund established by this Act.

     SECTION 3.  There is appropriated out of the Hawaii medical doctor loan program revolving fund the sum of $           or so much thereof as may be necessary for fiscal year 2009-2010 and the same sum or so much thereof as may be necessary for fiscal year 2010-2011 for the purposes of this Act.

     The sums appropriated shall be expended by the University of Hawaii for the purposes of this Act.

     SECTION 4.  In codifying the new subpart added to chapter 304A, Hawaii Revised Statutes, by section 1 of this Act, the revisor of statutes shall substitute appropriate section numbers for the letters used in designating the new sections in this Act.

     SECTION 5.  This Act shall take effect on July 1, 2020.