CS FOR SENATE BILL NO. 275(HES) An Act relating to the school year for purposes of the postsecondary student loan program; and providing for an effective date. SENATOR MIKE MILLER stated that currently, AS 14.43, Subsection (5), Section 160, "definitions" reads: "School year", means a period from September 1st of one year through August 31st of the following year. The bill would amend the definition to read that an academic period could be a minimum of 30 weeks of instructional time to begin between September 1st of one year and August 31st of the following year. Senator Miller noted that the current definition of "school year" assumes an agricultural society, such as existed when public education in America began in earnest in the 1820's and 1830's. Then the vast majority, perhaps 85%-90% of Americans lived on family farms. The school year was designed to begin after fall harvest and end before spring planting. Senator Miller continued, today, hardly more than one- percent of our population lives on family farms. The school calendar is obsolete, especially for higher education in urban America. The U. S. Department of Education defines an academic year as thirty weeks of instruction, and virtually all colleges and universities follow that pattern, either offering two fifteen-week semesters or three ten-week quarters. However, most continue to use the agriculture calendar, making it difficult to offer a fast-track program for urban individuals who want to get on with their education in a vigorous fashion. The U. S. Department of Education will offer a full loan to a full-time student who completes successfully a thirty-week academic year and will offer another loan as soon as that student begins another similar period of full-time study. Senator Miller pointed out that Charter College in Anchorage has experimented with offering five ten-week quarters in one calendar year or one and two-thirds academic years in one calendar year. That has proven popular because it allows a student to complete a two-year associate degree in just fifteen months. Charter is now in the planning stage of a four-year bachelor degree program, which will allow ambitious and hard-working students to complete their degrees in as little as thirty consecutive months. Unlike students in other programs following the slower and more traditional calendar, these students cannot obtain four State loans for their degrees, given the current definition of a school year. They deserve the option of taking on the challenge of a fast-track baccalaureate degree. Senator Miller advised that under that circumstance, the sum total of their loans for their education would be no more than that for their counterparts following traditional calendars. However, the cost of their education will have been reduced because they will have yielded less foregone income during their college years when they were in no position to hold full-time jobs. Co-Chair Therriault asked about the structure of the language on Page 1, Line 6-7. Senator Miller explained that language was left in for accounting purposes at the Student Loan Division. Representative J. Davies suggested that a period could be placed after "time". Senator Miller reiterated that the Student Loan Division wanted that language left as is for accounting purposes. Vice Chair Bunde asked if this would create a large change to the current semester system. He suggested that the language as currently written implies that a person can only apply for one student loan in the 12-month period. Senator Miller explained that the time would be "compressed" so that the student could receive a four-year degree in a three-year period. DIANE BARRANS, EXECUTIVE DIRECTOR, ALASKA COMMISSION ON POSTSECONDARY EDUCATION, DEPARTMENT OF EDUCATION, spoke to the Postsecondary Commission's support for the legislation. Ms. Barrans stated that there would be zero fiscal impact to the Commission while at the same time offering more opportunities to the Alaska College students. Ms. Barrans spoke to her concern. She pointed out that the objective was twofold: ? Providing an opportunity under an excellerated program to borrow more than one loan per year; and ? Doing so without changing anymore needed related statutes. Ms. Barrans commented that the intent was to keep the bill short, pointed out that it had been reviewed by the Attorney General. She reiterated that the legislation would allow the Commission to offer more than one loan per year with set terms of conditions. Co-Chair Therriault asked what would happen to a student that was not able to finish the program according to the proposed schedule. He asked if they would be precluded from receiving a loan for the following year. Ms. Barrons replied that would be a different issue in terms of completing the term at the required enrollment level. If the student were to complete that academic year in another loan year, under the terms of the new loan, they would be able to continue to borrow. Co-Chair Therriault clarified that a student would actually be able to draw three years worth of loans in a two-year period of time. Ms. Barrans acknowledged that was correct. Representative J. Davies asked the current restrictions on borrowing. Ms. Barrans explained that currently, an undergraduate could borrow $8500 dollars in a 12-month period. Representative J. Davies believed that the legislation would limit the 12-month period. Ms. Barrans stated that there would be a number of factors used to determine if they qualify for a second loan. The first criteria is if they had completed the entire academic period for the previous loan. If they did and had made good progress, they could apply for and receive a second loan. Representative J. Davies believed that by formulating the proposed change, there would be no limit on the number of loans that a person could receive in a two-year period. He proposed an amendment which would clarify that language. Co-Chair Therriault stated that rather than moving a conceptual amendment at this time, the bill would be held in Committee in order to confer with the drafters. MILTON BYRD, (TESTIFIED VIA TELECONFERENCE), ANCHORAGE, added that the U.S. Department of Education defines an academic period as 30 weeks of instruction. Most colleges in the country, pursue that by offering two 15 or 16 week semesters or three 10 or 11 week quarters. Mr. Byrd noted that a school can offer a compressed program, but they must offer the same amount of class time. He stressed that one could not compress the amount of time that it would take to complete a four-year degree by cutting out the "pauses" between terms. However, you can compress the amount of time taken to complete a degree. Representative J. Davies asked if there was language which stipulates that a student must complete the one 30-week period before receiving the next loan. Mr. Byrd referred that to Ms. Barrans. HB 275 was heard and HELD in Committee for further consideration.