S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                  10606

                          I N  A S S E M B L Y

                              June 8, 2016
                               ___________

Introduced  by  COMMITTEE  ON  RULES  -- (at request of M. of A. Crespo,
  Sepulveda, Pichardo, Ramos, Rivera, Arroyo,  Dilan,  Linares,  Davila,
  Moya, Cancel, Rodriguez) -- read once and referred to the Committee on
  Higher Education

AN  ACT  to amend the education law, in relation to establishing the New
  York state higher education debt consolidation and refinancing program

  THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section  1. Article 14 of the education law is amended by adding a new
part VI to read as follows:
                                 PART VI
         NEW YORK STATE HIGHER EDUCATION DEBT CONSOLIDATION AND
                           REFINANCING PROGRAM
SECTION 694-J. NEW YORK STATE HIGHER EDUCATION  DEBT  CONSOLIDATION  AND
                 REFINANCING PROGRAM.
  S  694-J. NEW YORK STATE HIGHER EDUCATION DEBT CONSOLIDATION AND REFI-
NANCING PROGRAM. 1.  THE CORPORATION SHALL HAVE THE AUTHORITY  TO  ISSUE
UP  TO  FIVE  HUNDRED MILLION DOLLARS IN BONDS, TO CONSOLIDATE AND REFI-
NANCE THE EDUCATION LOANS OF ELIGIBLE  BORROWERS  AT  A  LOWER  INTEREST
RATE,  PROVIDED, HOWEVER IF THE CORPORATION DETERMINES IT NEEDS TO ISSUE
MORE THAN FIVE HUNDRED MILLION DOLLARS IN BONDS TO OPERATE  THE  PROGRAM
EFFECTIVELY,  THE  CORPORATION  SHALL  MAKE THE DETERMINATION BY JANUARY
FIFTEEN OF THE YEAR SUBSEQUENT TO WHEN THE PROGRAM GOES INTO EFFECT.
  2. THE CORPORATION SHALL CONSOLIDATE AND REFINANCE THE EDUCATION LOANS
OF ELIGIBLE BORROWERS AND INTEREST SHALL ACCRUE UPON  ALL  STUDENT  LOAN
PAYMENTS  MADE  BY  ELIGIBLE  BORROWERS TO THE CORPORATION AT A RATE PER
ANNUM THAT IS EQUAL TO OR LESS THAN 5.5%. INTEREST SHALL ACCRUE FROM THE
TIME THE ELIGIBLE BORROWER COMMENCES REPAYMENT UNDER THIS  SECTION,  AND
SHALL  ACCRUE ONLY DURING THE PERIOD OVER WHICH THE ELIGIBLE BORROWER IS
REQUIRED TO MAKE SUCH REPAYMENT.
  3. SHOULD AN ELIGIBLE BORROWER FAIL TO PAY TO THE DIVISION ANY AMOUNTS
OWED UNDER THIS SECTION WITHIN THIRTY DAYS OF THE DUE DATE,  THE  CORPO-
RATION  SHALL  REVIEW THE ELIGIBLE BORROWER'S FINANCIAL CIRCUMSTANCES IN
ORDER TO DETERMINE WHETHER THE DELINQUENCY IS A RESULT OF  A  CHANGE  IN

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
              

                                                           LBD15279-01-6

A. 10606                            2

THE ELIGIBLE BORROWER'S FINANCIAL CIRCUMSTANCES. IF SUCH A DETERMINATION
IS  MADE,  THE  CORPORATION  MAY MODIFY THE ELIGIBLE BORROWER'S REQUIRED
PAYMENTS. IF FAILURE TO PAY IS NOT DETERMINED TO BE DUE  TO  A  MATERIAL
DETERIORATION  IN  THE  ELIGIBLE BORROWER'S FINANCIAL CIRCUMSTANCES, THE
CORPORATION SHALL TERMINATE AND  TAKE  ANY  LEGAL  ACTION  NECESSARY  TO
ENFORCE THE TERMS OF THE LOAN.
  4.  THE  PROGRAM'S OPERATING AND ADMINISTRATIVE COSTS SHALL BE COVERED
BY THE FEES CHARGED TO APPLY FOR THE REFINANCING AND THE  INTEREST  RATE
SURCHARGE.
  5. THE CORPORATION SHALL SUBMIT AN ANNUAL REPORT ON THE PROGRAM TO THE
GOVERNOR  AND  THE  LEGISLATURE AND THE REPORT SHALL BE PUBLISHED ON THE
CORPORATION'S WEBSITE. THE REPORT SHALL INCLUDE BUT NOT  BE  LIMITED  TO
THE FOLLOWING:
  (A) THE AMOUNT OF BONDS FLOATED TO COVER THE STUDENT DEBT REFINANCING;
  (B) THE NUMBER OF LOANS REFINANCED;
  (C) THE BREAKDOWN OF THE REFINANCING RATES CHARGED TO REFINANCE;
  (D) THE GENDER, RACE AND ETHNICITY OF THE PERSON REFINANCING;
  (E) THE TOTAL DEBT LOAD REFINANCED BY EACH RACIAL OR ETHNIC GROUP; AND
  (F)  THE  TOTAL  ADMINISTRATIVE  COSTS  FOR  OPERATING THE REFINANCING
PROGRAM AND THE PROJECTED TOTAL REFINANCING COSTS INCURRED TILL DEBT  IS
PAID FOR EACH RACIAL AND ETHNIC GROUP.
  6.  THE  CORPORATION IS AUTHORIZED TO PROMULGATE RULES AND REGULATIONS
NECESSARY FOR THE IMPLEMENTATION OF THE PROVISIONS OF THIS SECTION.
  7. UNDER THIS SECTION "ELIGIBLE BORROWER" AND "EDUCATION  LOAN"  SHALL
MEAN AS DEFINED UNDER SECTION SIX HUNDRED NINETY OF THIS ARTICLE.
  S 2. This act shall take effect on the one hundred twentieth day after
it shall have become a law.