S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   3498
 
                        2017-2018 Regular Sessions
 
                           I N  A S S E M B L Y
 
                             January 27, 2017
                                ___________
 
 Introduced  by  M.  of  A.  CRESPO,  SEPULVEDA, PICHARDO, RAMOS, RIVERA,
   ARROYO, DILAN, RODRIGUEZ, MOYA, DE LA ROSA -- 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.
   §  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-
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
              

                                                            LBD08267-01-7

 A. 3498                             2
 
 RATION  SHALL  REVIEW THE ELIGIBLE BORROWER'S FINANCIAL CIRCUMSTANCES IN
 ORDER TO DETERMINE WHETHER THE DELINQUENCY IS A RESULT OF  A  CHANGE  IN
 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.
   § 2. This act shall take effect on the one hundred twentieth day after
 it shall have become a law.