D.  Hawaii Educator Loans

 

§304A-701  Hawaii educator loans;eligibility; amounts; educator loan forgiveness program; repayment; collection. (a)  There is created the Hawaii educator loan program to be administered bythe University of Hawaii, in partnership with a financial institution whoseoperations are principally conducted in Hawaii, to provide financial support tostudents and teachers who complete a state-approved teacher education programand who agree to teach as a full-time teacher for a period of time to bedetermined by the university prior to the award of a loan, in:

(1)  The Hawaii public school system in a hard-to-fill position including specialeducation, regular education shortage categories, or Title 1 schools, and inone of the following capacities:

(A)  As an elementary school teacher teachingin the field of elementary education who has met standards as set forth by the Hawaii teacher standards board; or

(B)  As a secondary school teacher teaching inthe subject area that is relevant to the loan recipient's academic major ascertified by the department of education who has met standards as set forth bythe Hawaii teacher standards board; or

(2)  Ata school located in a rural area in the State, as determined by thesuperintendent of education.

Eligibility shall be determined by the university ona competitive basis.  The amount to be loaned to a student shall be determinedby the board of regents based on need for financial aid and proof of acceptanceinto a state-approved teacher education program at the university.  The maximumamount of loans that a student may receive under this program shall be anaggregate amount equivalent to tuition payments and costs of textbooks andother instructional materials necessary to complete a state-approved teachereducation program.

(b)  All loans made under this subpart shallbear interest at five per cent simple interest.  Repayment of principal andinterest charges shall commence one year after graduation or three months aftera loan recipient ceases to be enrolled in a state-approved teacher educationprogram and shall be paid in periodic installments within a seven-year period. The university may charge late fees and all other reasonable costs for thecollection of delinquent loans.

(c)  The university shall adopt rules toimplement the educator loan program.  The rules shall be adopted pursuant tochapter 91, but shall be exempt from the public notice and public hearingrequirements.

(d)  Liability for repayment of a loan shall becanceled upon the death or permanent total disability of the borrower.

(e)  Upon a showing of proof that the loanrecipient has completed a state-approved teacher education program and for eachyear that the loan award recipient teaches in the Hawaii public school systempursuant to subsection (a)(1) or (2), loan forgiveness shall be provided to therecipient as follows:

(1)  Ten per cent of the total amount of the loanaward and interest shall be waived every year for the first five years ofrepayment; and

(2)  Twenty-five per cent of the total amount of theloan award and interest shall be waived every year for the sixth and seventhyears of repayment.

(f)  If a loan recipient who is a graduate of astate-approved teacher education program subject to this section and teachingpursuant to subsection (a) fails to teach in the Hawaii public school systemfor the minimum number of years, as determined by the university prior to theloan, from the recipient's original date of employment with the department ofeducation, excluding temporary leaves of absence, then the recipient shallrepay any remaining loan balance at the rate of ten per cent simple interest.

(g)  In accordance with chapter 103D, the universitymay enter into written contracts with collection agencies for the purpose ofcollecting delinquent loans.  All payments collected, exclusive of a collectionagency's commissions, shall revert, and be credited, to the Hawaii educatorloan program special fund.  A collection agency that enters into a writtencontract with the university for the collection of delinquent loans pursuant tothis section may collect a commission from the debtor in accordance with theterms of, and up to the amounts authorized in, the written contract. [L 2006, c75, pt of §2; am L 2007, c 273, §2]