00                      CS FOR HOUSE BILL NO. 43(EDU)                                                                     
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       public school teachers.  (a)  Except as provided under (b) of this section, the state                           
07       shall forgive a loan made to a borrower who has received a teaching degree or credit                              
08       hours necessary to obtain a teaching certificate or endorsement from a college or                                 
09       university located in this state, is employed as a teacher at a public elementary or                              
10       secondary school, is employed within a geographically underserved area of the state or                            
11       is employed in the state to teach a subject for which there is a shortage of teachers, and                        
12       has complied with AS 14.43.120.  The amount to be forgiven under this section is the                              
13       payments to be made by the borrower for a loan made under AS 14.43.110 equal to                                   
14       the following percentages of the total loan received plus interest up to a total of 100                           

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