HB 506 - STUDENT LOAN PROGRAM Number 398 REP. CON BUNDE, Co-Chair of the House HESS Committee, sponsor of HB 506, explained to the committee that there was a letter in their packet that addresses a loophole in the bill regarding people who are enrolled but not attending classes. The letter suggests an amendment that would change the bill to incorporate this technical amendment. Number 429 REP. PORTER asked what the difference was between being admitted to school or enrolled in school. REP. BUNDE responded that you could be admitted to a program but not necessarily be enrolled that semester. Number 447 MR. JOE McCORMICK, Executive Director, Postsecondary Education Commission, Department of Education, explained that an amendment would address the misinterpretation that some students have that they can't apply for the loan until after they are actually attending classes. Number 465 The committee discussed the language of the amendment in an effort to clarify the intent of the amendment, which was that an applicant does not have to be enrolled in a program to apply for a loan. Number 520 REP. BUNDE stated that the program has been working without this amendment and he felt the amendment may cause more problems than it fixes. He withdrew the amendment from consideration. Number 560 REP. PORTER stated that he would still support the concept of the student loan program comparing its listing of defaultees against the Department of Administration's list of vendors on contract with the state. Number 570 CHAIRMAN HUDSON explained that he spoke with Commissioner Usera and she had decided to take the amendment referenced above to the Finance Committee for their consideration. Number 580 REP. GREEN and REP. MULDER told the committee that the commissioner wanted to have the language in statute that would add language to the bid package sent to potential vendors that they need not apply if they are in default to the state on any loan. Number 590 CHAIRMAN HUDSON told the committee he would like to send the bill on without the amendment and abide by the wishes of the commissioner, unless someone on the committee had an amendment they wished to present now. Number 595 REP. PORTER moved an amendment to the bill to delete subsection (c), page 5, lines 22, 23 and 24. Number 600 REP. BUNDE told the committee that the student loan program would probably not survive if the program had to keep coming back to the legislature for appropriations from the general fund. Number 607 MR. McCORMICK explained that the reason they put subsection (c) in HB 506 was to assure priority over other loans. Number 630 REP. SITTON stated that from a practical standpoint this would be impossible to implement. Number 640 REP. PORTER believed there were other programs that could make a good case for top priority for garnishment. He added that the one program he was thinking of was the victim compensation board. TAPE 94-29, SIDE A Number 001 MR. McCORMICK stated he was very willing to compromise on this issue and reiterated how important he felt it was for this legislation to pass this session. Number 014 CHAIRMAN HUDSON stated that he was sympathetic to the idea of a person losing their permanent fund dividend it they were delinquent in their student loan. He added that he felt that giving priority of the student loan program over some of the other programs was not good public policy. The chair stated he supported the amendment. CHAIRMAN HUDSON asked if there were any objections to Rep. Porter's previously offered amendment. No objections were heard; it was so ordered. Number 049 MS. PAIGE ADAMS, Student Representative, University of Alaska, Sitka, testified via teleconference in support of HB 506. She stated she didn't have anything else to add. Number 070 REP. GREEN moved CSHB 506 with individual recommendations and accompanying fiscal notes. No objections were heard; it was so ordered.