SB 39 - MEMORIAL SCHOLARSHIP LOANS CO-CHAIR BUNDE chaired this portion of the meeting. Number 856 JOE AMBROSE, Legislative Assistant to Senator Robin Taylor, presented the sponsor statement on Senator Taylor's behalf. He said this bill was introduced at the suggestion of the Admissions Clerk at the University of Alaska Southeast, Sitka Campus. The bill would modify the eligibility requirements for the Alaska State Troopers Michael Murphy scholarship program to include certificate programs. The wording of AS 14.43.300 currently limits the awarding of Murphy scholarship loans to students who pursue a degree program in law enforcement, law, probation, and parole, and closely related fields. MR. AMBROSE said the language prevents students in a certificate program such as the law enforcement certificate program offered at the Sitka campus from eligibility. The scholarship revolving loan fund established by the legislature includes a provision allowing forgiveness of one-fifth of the loan indebtedness for each year of full employment in Alaska in law enforcement. Department of Labor statistics show that 63 percent of Sitka program graduates are currently employed in the state as law enforcement personnel. Number 920 MR. AMBROSE noted the bill carries a zero fiscal note, and received unanimous "do-pass" recommendations from both the Senate HESS and Finance Committees last year before receiving a unanimous vote in the full Senate. SB 39 will potentially benefit Alaskan students attending an Alaskan school with an eye toward employment in Alaska. Mr. Ambrose said a representative from Senator Zharoff's office was present to explain Sections 3 through 5 of the CS from the Finance Committee. These amendments were offered by Senator Zharoff. CO-CHAIR TOOHEY said the only program with forgiveness is the trooper memorial. She asked if that was correct. MR. AMBROSE said there is a forgiveness provision that applies to most of the scholarship loans that are covered by AS 14.43.300. This specific bill only changes the requirement from a graduate or degree program to a certificate program under the Michael Murphy scholarship. The provision that was amended by Senator Zharoff makes a change in the Winn Brindle memorial scholarship. CO-CHAIR BUNDE added that as a member of the Postsecondary Education Commission, he was involved in hearing an appeal where a very deserving applicant was not covered because he/she was in a certificate program, and not a degree program. Co-Chair Bunde doubted it was the original intent of the program to exclude those applicants. He certainly supports the goal of this legislation. Number 1040 THOMAS PANAMAROFF, Legislative Assistant to Senator Zharoff, explained that Sections 3, 4 and 5 of CSSB 39(FIN) apply to the Winn Brindle Memorial Scholarship Loan. Senator Zharoff had a bill, SB 36, that dealt with the Winn Brindle Memorial Scholarship Loan. It was up before Senate Finance at the same time as Senator Taylor's bill. The committee decided to meld the two bills together. MR. PANAMAROFF said several years ago the legislature established the Winn Brindle Memorial Scholarship Loan. The program's intent is to make loans to Alaskan students who are seeking degrees in fields that relate to the fishing industry, food technology, fish biology, and related fields. The program is funded by contributions from the fish processing industry. Since 1987, processors have contributed over $1.8 million to the program. MR. PANAMAROFF reported that currently, there is a balance of about $1.4 million in the Winn Brindle fund. He believes the reason for the large balance in the fund is because there has not been many students accessing the program. The reason they have not been accessing the program is because the payback provisions on the program are exactly the same as the regular student loan program. Therefore, there is no incentive for a student to access the Winn Brindle funds because they would have to be pursuing a fisheries- related field. This fund restricts their ability to change majors if they ever wanted to. MR. PANAMAROFF said in order to try to get more access to the program, Senator Zharoff introduced SB 36. The bill provides for a loan forgiveness provision similar to the old student loan program, where over a course of five years, a student can get forgiveness of up to 50 percent. It also fixes the rate of interest on the loan at 5 percent. MR. PANAMAROFF said basically the bill does not have any general fund impact. The program is funded by processors. CO-CHAIR BUNDE thinks the interest in this fund will grow, considering the new student loan interest without a payback provision will be about 9 percent. Therefore, Senator Zharoff may soon encounter more interest in fisheries. He closed public testimony, and asked for the wish of the committee. Number 1170 CO-CHAIR TOOHEY motioned to move CSSB 39(FIN) from the HESS Committee with its two zero fiscal notes and individual recommendations. There were no objections, and the bill passed. Co-Chair Toohey chaired the next bill.