Technology Scholarship Program

Adds a new chapter to establish the New Economy Technology
Scholarship Act.  (CD1)

THE SENATE                              S.B. NO.           S.D. 2
TWENTIETH LEGISLATURE, 2000                                H.D. 2
STATE OF HAWAII                                            C.D. 1

                     A BILL FOR AN ACT



 1      SECTION 1.  The legislature finds that in the last fifteen
 2 years a "New Economy" has emerged in the United States.  This
 3 change has fundamentally altered industrial and occupational
 4 order, introduced unprecedented levels of entrepreneurial
 5 dynamism and competition, as well as a dramatic trend toward
 6 globalization.  This "New Economy" has been spurred by advances
 7 in technologies and has effectively restructured the way
 8 businesses operate in today's marketplace.
 9      The legislature further finds that a recent report, "The
10 State New Economy Index, Benchmarking Economic Transformations in
11 the States," by the Progressive Policy Institute, has begun to
12 assess how the fifty states have responded to--and encouraged-
13 -these fundamental changes.  In this report, Hawaii has attained
14 an overall rank of twenty-six among the fifty states.  While
15 Hawaii does well in some areas--foreign direct investment,
16 workforce education, and education technology in the schools--it
17 ranks poorly in a number of critical areas, particularly new
18 business start-ups and high technology jobs.

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 1      The legislature believes that if Hawaii's businesses and
 2 residents are to compete successfully in this "New Economy," the
 3 State must encourage and support growth in technology.
 4 Currently, there is a demand for highly trained technology
 5 workers.  For example, CISCO Networking Systems urgently needs a
 6 highly skilled workforce and is committing substantial energies
 7 toward training and developing technology workers.  It has helped
 8 prepare over 70,000 students worldwide during the past three
 9 years in its networking academies; of these, just 684 students
10 are from Hawaii.
11      The purpose of this Act is to establish a new economy
12 technology scholarship program on a pilot basis to create a
13 sustained pool of highly trained technology workers, in the
14 shortest time possible, to improve this State's ability to
15 attract and retain business.  Further, this Act is intended to
16 encourage Hawaii students to pursue higher education and training
17 in science and technology fields that are essential to economic
18 development in this State.
19      SECTION 2.  The Hawaii Revised Statutes is amended by adding
20 a new chapter to be appropriately designated and to read as
21 follows:

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 1                             "CHAPTER
 3         -1  Short title.  This chapter shall be known and may be
 4 cited as the New Economy Technology Scholarship Act.
 5         -2 Definitions.  As used in this chapter, unless the
 6 context otherwise requires:
 7      "Approved course of study" means a program or curriculum
 8 offered by an approved post-secondary educational institution
 9 that provides instruction in science, technology, and related
10 fields, and that is on the list of approved courses of study
11 established by the department in    -3(c).
12      "Approved educational institution" means a public or private
13 post-secondary educational institution located in this State that
14 has been accredited by a nationally recognized accrediting agency
15 that is listed by the United States Secretary of Education, or
16 vendor educational programs provided by vendor certified training
17 organizations.
18      "Department" means the department of business, economic
19 development, and tourism.
20      "Incumbent worker" means any person who has been a resident
21 of this State for one year and who has been employed full-time in
22 this State for a period of one year while pursuing an associate
23 degree or its equivalent.

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 1      "Program" means the new economy technology scholarship
 2 program established under section    -3.
 3      "Student" means any individual domiciled in this State who
 4 attends or is about to attend a secondary school or post-
 5 secondary educational institution located in this State.
 6      "Vendor educational programs" means those courses offered by
 7 technology businesses, resulting in a professional certification
 8 to provide services within that vendor's business.
 9      "Work requirement" means postgraduate, full-time employment
10 with an employer located in this State in an occupation related
11 to an approved course of study required under    -3.  The term
12 does not include a paid student internship, a paid fellowship,
13 volunteer service, or employment before graduation.
14         -3 New economy technology scholarship pilot program;
15 establishment, administration.(a)  There is established a five-
16 year pilot program to be known as the new economy technology
17 scholarship program to be placed in the department of business,
18 economic development and tourism for administrative purposes.
19      (b)  Under the parameters of the scholarship program, the
20 department may provide scholarship grants to an eligible student
21 who is a resident of this State upon confirmation from an
22 approved educational institution that the student has been
23 accepted for enrollment in an approved course of study.

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 1 Scholarship grants shall only be for the amount set forth in
 2 sections    -4(a) and    -5(a) and shall only be used for tuition
 3 and mandatory fees.
 4      (c)  The department shall establish lists of approved
 5 courses of study for the various types of approved educational
 6 institutions to be addressed by the program.  The lists shall be
 7 based on areas of business demand and expected contribution to
 8 economic development and shall be reviewed and updated on an
 9 annual basis.
10      (d)  To receive a scholarship grant under this chapter, a
11 student shall meet all of the following requirements:
12      (1)  Graduation from a high school in this State, or earned
13           a general educational development (GED) diploma or the
14           equivalent thereof;
15      (2)  Maintenance of domicile in Hawaii during the term of
16           the scholarship grants;
17      (3)  Compliance with any conditions placed on the
18           scholarship grant by the department;
19      (4)  For those attending a post-secondary education
20           institution, maintenance of a grade point average of
21           3.0 or higher, on a scale of 4.0, or its equivalent,
22           beginning with the first semester of the freshman year
23           and through the term of the scholarship or in the last

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 1           year of high school if the student is applying under
 2           section    -4 or    -5; or if enrolled in a vendor
 3           educational program maintenance of a passing rate in
 4           the program; and
 5      (5)  Enter into a written agreement with the department to:
 6           (A)  Satisfy all degree, diploma, or certificate
 7                requirements and other requirements under this
 8                chapter;
 9           (B)  Commence employment in this State within one year
10                after completion of an approved undergraduate
11                degree or certificate program for a period of one
12                year for each academic year the student received a
13                scholarship grant under this chapter unless the
14                department determines that there are extenuating
15                circumstances; and
16           (C)  Reimburse the State all amounts received under
17                this chapter and interest thereon, as determined
18                by the department, if the student fails to comply
19                with subparagraphs (A) and (B).
20      (e)  A student shall apply to the department for a
21 scholarship grant as prescribed by the department, and include
22 all information and documentation required by the department.
23 The application of a student under eighteen years of age shall

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 1 include the signature of a parent or guardian.  The application
 2 shall include a verified statement of grade point average from
 3 the appropriate approved educational institution.
 4      (f)  The work requirement under subsection (e)(5)(B) shall
 5 begin after the receipt of bachelor's or associate's degree or
 6 other appropriate certificate from an approved educational
 7 institution.
 8      (g)  If a student terminates enrollment in the approved
 9 educational institution during the academic year or prior to
10 completion of the approved course of study, the approved
11 educational institution shall notify the department in writing
12 and shall return all unused portions of the scholarship grant.
13 Returned amounts shall be used to fund other scholarship grants
14 under this chapter.
15      (h)  A scholarship under this chapter is only transferrable
16 to another approved educational institution if approved by the
17 department.
18      (i)  Grants awarded under the program shall be limited to
19 funds appropriated for that purpose or funds otherwise matched by
20 external entities.  First priority for awarding grants shall be
21 given to renewal applicants.
22         -4 Scholarships; bachelor's degree programs.(a)  The
23 department shall award a scholarship in an amount up to $2,000

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 1 per academic year to a student enrolled full-time in an approved
 2 educational institution pursuing a bachelor's degree in an
 3 approved course of study.
 4      (b)  A grant shall be awarded beginning no earlier than the
 5 second academic year of enrollment in an approved educational
 6 institution.  The grant shall be for a maximum of three academic
 7 years or for up to four academic years if the student is enrolled
 8 in an approved course of study that, according to the department,
 9 requires five academic years to complete.  To qualify for
10 renewals beyond three years, the student must be in compliance
11 with the requirements of section    -3(d) and the department must
12 determine that the student is making satisfactory progress toward
13 completing a degree.
14      (c)  A student who accepts a grant under this section shall
15 complete a college-approved or university-approved internship or
16 work experience in a science, technology, or related field with
17 an employer located in this State prior to receiving a bachelor's
18 degree.  The student shall comply with any conditions placed upon
19 the internship by the department.  Proof of completion of the
20 internship or work experience requirements must be submitted to
21 the department prior to graduation, unless otherwise authorized
22 by the department.

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 1         -5 Scholarships; associate and certificate programs.
 2 (a)  The department shall award a scholarship in an amount up to
 3 $2,000 per academic year to a student enrolled full-time in an
 4 approved educational institution pursuing an associate's degree
 5 or a certificate provided by a vendor educational program, or in
 6 a degree-granting institution subject to chapter 446E in an
 7 academic program approved by the department.  A student who is
 8 enrolled part time and is an incumbent worker pursuing an
 9 associate's degree, certification, or other specialized program
10 approved by the department is eligible for a grant of twenty per
11 cent tuition and mandatory fees.
12      (b)  The grant shall be for a maximum of two academic years
13 or for up to three academic years if the student is enrolled in
14 an approved course of study that, according to the department,
15 requires three academic years to complete.  To qualify for a
16 grant three times, the student must be in compliance with section
17    -3(d), and the approved educational institution must determine
18 that the student is making satisfactory progress toward
19 completing an associate's degree or the requirements of the
20 certificate program.
21      (c)  The department may waive the one-year employment
22 requirement for an incumbent worker for extenuating circumstances
23 related to the student's employment within the last year.

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 1         -6 Program administration.(a)  The department shall
 2 monitor and verify a student's fulfillment of all internship and
 3 work requirements under this chapter.
 4      (b)  The department may enter into a contract with a private
 5 or public entity to administer the program.
 6      (c)  The department shall enforce repayment of all
 7 scholarship grants for a student who does not comply with this
 8 chapter.  Repayment shall include the use of all lawful
 9 collection procedures and the use of private collection agencies.
10      (d)  Scholarship grants received by a student from the
11 program shall not be considered taxable income under chapter 235.
12      (e)  Scholarship grants received by a student from the
13 program shall not be considered financial assistance or
14 appropriations to the approved educational institution.
15      (f)  No funds under this chapter shall be granted to a
16 person enrolled in a customized job training partnership program
17 or continuing education course from a post-secondary educational
18 institution for which an employer is providing over fifty per
19 cent of the financial support, directly or indirectly, and for
20 which the student is not being charged tuition or fees.
21      (g)  Any person who knowingly or intentionally procures,
22 obtains, or aids another to procure or obtain a grant under this
23 chapter through fraudulent means shall be disqualified from

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 1 participation in the program and shall be liable to the
 2 department for an amount equal to three times the amount
 3 obtained.
 4      (h)  Any appeal under this chapter shall be subject to
 5 chapter 91.
 6      (i)  The department shall adopt rules under chapter 91
 7 necessary to carry out the purposes of this chapter.
 8         -7 Annual report.(a)  The department shall publish a
 9 report by September 1, 2001, and every year thereafter.  The
10 report shall include information regarding the operation of the
11 program to include:
12      (1)  The total number of students receiving scholarship
13           grants;
14      (2)  The total amount of scholarship funds awarded;
15      (3)  The number of full-time and part-time students
16           receiving scholarship grants attending four-year
17           educational institutions, community colleges,
18           independent two-year colleges, degree-granting
19           institutions, vendor educational programs, and
20           certificate programs reported by institution and
21           category of institution;
22      (4)  The amount of scholarship funds awarded to students
23           attending four-year educational institutions, community

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 1           colleges, independent two-year colleges, degree-
 2           granting institutions, vendor educational programs, and
 3           certificate programs reported by institution and
 4           category of institution; and 
 5      (5)  The total number of students who withdraw from the
 6           program or internship or work requirements.
 7      (b)  The annual report shall be submitted to the governor
 8 and the legislature."
 9      SECTION 3.  There is appropriated out of the general
10 revenues of the State of Hawaii the sum of $200,000 or so much
11 thereof as may be necessary for fiscal year 2000-2001 to
12 establish and implement the new economy technology scholar
13 program.
14      The sum appropriated shall be expended by the department of
15 business, economic development, and tourism for the purposes of
16 this Act.
17      SECTION 4.  This Act shall take effect on July 1, 2000, and
18 shall be repealed on June 30, 2005.