HBA-KDB C.S.H.B. 2766 77(R)BILL ANALYSIS Office of House Bill AnalysisC.S.H.B. 2766 By: Delisi Higher Education 4/20/2001 Committee Report (Substituted) BACKGROUND AND PURPOSE Currently, the Texas Higher Education Coordinating Board (board) oversees several different student loan repayment assistance programs. However, the board, with very few exceptions, does not provide repayment assistance to attorneys who choose to work for the office of the attorney general (OAG). A law student may incur high education loan debt, and as a result may feel compelled not to consider working for the OAG but to accept higher paying private sector employment to pay off his or her debt. In addition, there is concern that the turnover rate is high for attorneys who initially work for the OAG. C.S.H.B. 2766 authorizes the board to provide assistance in the repayment of education loans for attorneys who work for the OAG. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that rulemaking authority is expressly delegated to the Texas Higher Education Coordinating Board in SECTION 1 (Section 61.959, Education Code) and SECTION 2 of this bill. ANALYSIS C.S.H.B. 2766 amends the Education Code to authorize the Texas Higher Education Coordinating Board (board) to provide assistance in the repayment of education loans for attorneys who apply and qualify for the assistance. To be eligible to receive repayment assistance, an attorney must apply to the board, be employed by or have been offered employment with the office of the attorney general (OAG) at the time the attorney applies for the assistance, and enter into an agreement to serve as an attorney for at least three years with the OAG. The bill sets forth the terms of the agreement. The bill authorizes an attorney who enters into such an agreement to receive repayment assistance in an amount not to exceed $6,000 per year. The bill prohibits an attorney from receiving repayment assistance for more than three years. The bill authorizes the board to provide repayment assistance for any education loan received by an attorney through any lender, other than a private individual, for education at a school of law authorized by the board to award a degree that satisfies the law study requirements for licensure as an attorney in this state or for undergraduate education at a public or an accredited private or independent institution of higher education. The bill prohibits the board from providing repayment assistance for an education loan that is in default at the time of the attorney's application. The bill requires the board, each state fiscal biennium, to attempt to allocate all funds appropriated for the purpose of providing repayment assistance. The bill sets forth provisions regarding repayment of loans by the board. The bill authorizes the board to appoint an advisory committee to assist the board in performing the board's duties and to request the assistance of the State Bar of Texas and the OAG in performing those duties. The bill requires the board to adopt rules, not later than December 1, 2001, necessary for the administration of repayment assistance and to distribute a copy of the adopted rules and other pertinent information to each authorized school of law, any appropriate state agencies, and any appropriate professional associations. The bill prohibits the total amount of repayment assistance from exceeding the total amount of funds available to the board for repayment assistance. The bill requires the governing board of each public school of law in this state authorized by the board to award a degree that satisfies the law study requirements for licensure as an attorney in this state to set aside one percent of tuition charges for resident students enrolled in the school of law. The bill requires the amount set aside to be transferred to the comptroller of public accounts to be maintained in the state treasury for the sole purpose of repayment assistance of education loans of attorneys. Provisions relating to the use of dedicated revenue do not apply to the amount set aside for the repayment assistance. The bill requires the board to submit a report, not later than December 1, 2004, to the legislature regarding assistance in the repayment of education loans for attorneys. EFFECTIVE DATE September 1, 2001. COMPARISON OF ORIGINAL TO SUBSTITUTE C.S.H.B. 2766 modifies the original bill by providing that to be considered eligible for repayment assistance an attorney must be employed by or have been offered employment with the office of the attorney general (OAG) and enter into an agreement to serve as an attorney with the OAG. The substitute sets forth the terms of such an agreement. The original provided that a lawyer, to be eligible to receive repayment assistance, must be currently employed by the State of Texas as a lawyer and have completed at least one year of employment with the state as a lawyer. The substitute authorizes an attorney to receive payment assistance in an amount not to exceed $6,000 per year. The substitute decreases from five to three the number of years an attorney may receive repayment assistance. The substitute specifies that the Texas Higher Education Coordinating Board (board) is to adopt rules not later than December 1, 2001 for the administration of repayment assistance. The substitute removes the provision in the original bill that authorized the board to distribute a copy of the adopted rules to out-ofstate law schools. The substitute requires the governing board of each public school of law in this state authorized by the board to award a degree that satisfies the law study requirements for licensure as an attorney in this state to set aside one percent of tuition charges for resident students enrolled in the school of law. The substitute requires the amount set aside to be transferred to comptroller of public accounts (comptroller) to be maintained in the state treasury for the sole purpose of repayment assistance of education loans of attorneys. The original required the total amount of funds available for repayment assistance to be maintained by the comptroller in a separate account in the state treasury. The substitute removes the requirement that the Texas Supreme Court deposit 10 percent of the occupation tax on attorneys to the credit of the separate account in the state treasury for repayment assistance. The substitute requires the board to submit a report, not later than December 1, 2004, to the legislature regarding repayment assistance of education loans of attorneys. The substitute modifies the effective date from August 27, 2001, to September 1, 2001. The substitute differs from the original by conforming to Texas Legislative Council style and format. The substitute differs from the original by removing the severability clause and provisions regarding a pilot program for student loan assistance repayment.