00                      CS FOR HOUSE BILL NO. 43(HES)                                                                     
01 "An Act relating to forgiveness of certain student loans; and providing for an effective                                
02 date."                                                                                                                  
03 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA:                                                                
04    * Section 1.  AS 14.43 is amended by adding a new section to read:                                                 
05            Sec. 14.43.142.  Loan forgiveness of loans made to borrowers employed as                                   
06       school teachers.  (a)  Except as provided under (b) of this section, the state shall                            
07       forgive a loan made to a borrower who (1) has complied with AS 14.43.120, (2) has                                 
08       received a teaching degree or credit hours necessary to obtain a teaching certificate or                          
09       endorsement from a college or university located in this state, (3) is employed as a                              
10       teacher at an elementary or secondary school in this state, and (4) is employed within a                          
11       geographically underserved area of the state, employed in the state to teach a subject                            
12       for which there is a shortage of teachers, or employed in the state in another                                    
13       educational capacity in which a shortage has been identified.  The amount to be                                   
14       forgiven under this section is the payments to be made by the borrower for a loan                                 

01       made under AS 14.43.110 equal to the following percentages of the total loan received                             
02       plus interest up to a total of 100 percent of the total loan plus interest:                                       
03                 (1)  one year employment as described in this subsection, 15 percent;                                   
04                 (2)  two years employment as described in this subsection, an                                           
05       additional 17.5 percent;                                                                                          
06                 (3)  three years employment as described in this subsection, an                                         
07       additional 20 percent;                                                                                            
08                 (4)  four years employment as described in this subsection, an                                          
09       additional 22.5 percent;                                                                                          
10                 (5)  five years employment, an additional 25 percent.                                                   
11            (b)  This section does not apply to a loan under AS 14.43.110 given to a                                     
12       borrower who has fewer than 60 hours of credit at a college or university.                                        
13            (c)  The loan amount forgiven under this section may not exceed the loan                                     
14       balance due to the state.  Notwithstanding any other provision of law, while                                      
15                 (1)  a person's loan is being forgiven by the state under (a) of this                                   
16       section, that person may not receive forgiveness of a loan under any other provision of                           
17       this chapter; and                                                                                                 
18                 (2)  a person is qualified for forgiveness under this section a borrower's                              
19       obligation to commence repayment of the principal and interest on the loan is                                     
20       suspended.                                                                                                        
21            (d)  For purposes of (a) of this section, the commission shall determine the                                 
22       areas in this state that are geographically underserved, the subject areas that have a                            
23       shortage of teachers, and other employment in which a shortage is identified.                                     
24            (e)  Forgiveness under (a) of this section is subject to appropriation by the                                
25       legislature.  Money obtained from the sale of bonds by the Student Loan Corporation                               
26       under AS 14.42.220 may not be appropriated for the payment of forgiveness of loans.                               
27            (f)  In this section, "teacher" includes a librarian, counselor, or other person                             
28       who possesses a valid teacher certificate issued under AS 14.20.020.                                              
29    * Sec. 2.  The uncodified law of the State of Alaska is amended by adding a new section to                         
30 read:                                                                                                                   
31       APPLICABILITY.  This Act applies to loans entered into on or after July 1, 2001, and                              

01 to a person's employment that occurs on or after July 1, 2001.                                                          
02    * Sec. 3.  This Act takes effect July 1, 2001.