Senate Bill S10568

                             
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   10568
 
                             I N  S E N A T E
 
                               May 26, 2026
                                ___________
 
 Introduced  by Sen. STAVISKY -- read twice and ordered printed, and when
   printed to be committed to the Committee on Education
 
 AN ACT to amend the education law, in relation to establishing  the  New
   York  reinvests in student educational supports program; and to repeal
   certain provisions of such law relating to the New York higher  educa-
   tion loan program

   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. Legislative findings and intent. The legislature finds that
 recent changes to federal student lending  programs  have  significantly
 reduced  access  to  affordable credit for graduate students enrolled in
 academic and professional programs critical to New York's workforce  and
 economic  competitiveness,  including  graduate  and professional degree
 programs in high need fields critical to New York's  workforce  such  as
 education,  nursing, healthcare, social services, public administration,
 creative arts, and other licensed professions.
   The legislature further finds that the  reduction  or  elimination  of
 federal   graduate   lending   options   threatens   enrollment,  degree
 completion, and workforce supply in areas of demonstrated state need.
   It is therefore the intent of the legislature  to  establish  the  New
 York  Reinvests  in  Student  Educational Supports (NY RISES) Program to
 provide eligible students with access to responsible, affordable  educa-
 tional loans to supplement available federal student aid and help bridge
 the  gap  between the cost of attendance and available financial assist-
 ance.
   § 2. Part 5 of article 14 of title 1 of the education law is  REPEALED
 and a new part 5 is added to read as follows:
                                   PART V
         NEW YORK REINVESTS IN STUDENT EDUCATION SUPPORTS PROGRAM
 SECTION 690. DEFINITIONS.
         691. POWERS AND DUTIES.
         692. EDUCATIONAL LOANS; SPECIAL REQUIREMENTS.
         693. REPAYMENT OF LOANS.
         694. SALE OF EDUCATION LOANS.
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
              

                                                            LBD15994-01-6
 S. 10568                            2
 
         694-A. MISCELLANEOUS.
         694-B. REPORTING.
   §  690. DEFINITIONS.  AS  USED IN THIS PART, THE FOLLOWING TERMS SHALL
 HAVE THE FOLLOWING MEANINGS UNLESS OTHERWISE SPECIFIED:
   1. "AUTHORITY" SHALL MEAN THE DORMITORY AUTHORITY OF THE STATE OF  NEW
 YORK (DASNY).
   2.  "EDUCATION  LOAN"  SHALL  MEAN  ANY  LOAN  THAT IS MADE UNDER THIS
 PROGRAM TO FINANCE OR REFINANCE HIGHER EDUCATION EXPENSES AT AN ELIGIBLE
 COLLEGE.
   3. "ELIGIBLE BORROWER" OR "BORROWER" SHALL MEAN (A) A STUDENT WHO IS A
 RESIDENT OF NEW YORK STATE ATTENDING OR ACCEPTED FOR  ENROLLMENT  AT  AN
 ELIGIBLE  COLLEGE  AND  IS  ENROLLED  AT  LEAST HALF TIME IN AN ELIGIBLE
 PROGRAM AT AN ELIGIBLE COLLEGE; OR (B) THE PARENT,  LEGAL  GUARDIAN,  OR
 SPONSOR,  AS  DEFINED BY THE CORPORATION IN REGULATION, OF A STUDENT WHO
 IS ENROLLED, OR ACCEPTED FOR ENROLLMENT AT AN ELIGIBLE COLLEGE, AND  WHO
 OBTAINS  AN  EDUCATION  LOAN  FROM  A  LENDING INSTITUTION TO PAY FOR OR
 FINANCE HIGHER EDUCATION EXPENSES UNDER THIS PROGRAM.
   4. "ELIGIBLE COLLEGE" SHALL MEAN A POST-SECONDARY INSTITUTION, LOCATED
 WITHIN NEW YORK STATE, ELIGIBLE FOR FUNDS UNDER TITLE IV OF  THE  HIGHER
 EDUCATION  ACT  OF NINETEEN HUNDRED SIXTY-FIVE, AS AMENDED, OR SUCCESSOR
 STATUTE OFFERING GRADUATE OR PROFESSIONAL DEGREE GRANTING OR CERTIFICATE
 PROGRAM.
   5. "ELIGIBLE PROGRAM" SHALL MEAN AN  ACCREDITED  GRADUATE  OR  PROFES-
 SIONAL  DEGREE  PROGRAM  OFFERED  BY A POSTSECONDARY INSTITUTION THAT IS
 APPROVED BY THE COMMISSIONER AND REGISTERED BY THE  DEPARTMENT  PURSUANT
 TO THIS CHAPTER AND APPLICABLE REGULATIONS.
   6.  "ELIGIBLE CO-SIGNER" SHALL MEAN A PARENT, LEGAL GUARDIAN OR OTHER-
 WISE CREDIT WORTHY INDIVIDUAL OVER TWENTY-ONE YEARS OF AGE WHO SATISFIES
 APPLICABLE CREDIT CRITERIA APPROVED BY THE AUTHORITY AND IS  A  RESIDENT
 OF NEW YORK STATE.
   7. "HIGHER EDUCATION EXPENSES" SHALL MEAN THE COST OF ATTENDANCE AT AN
 ELIGIBLE  COLLEGE  AND  SHALL  INCLUDE TUITION AND FEES, BOOKS, ROOM AND
 BOARD, AND OTHER EDUCATIONALLY RELATED EXPENSES, AS  DETERMINED  BY  THE
 AUTHORITY.
   8. "HOLDER" SHALL MEAN, WITH RESPECT TO AN EDUCATION LOAN: (A) A LEND-
 ER;  (B) A PUBLIC BENEFIT CORPORATION AUTHORIZED TO FINANCE THE PURCHASE
 OR MAKING OF EDUCATION LOANS PURSUANT TO THE PUBLIC AUTHORITIES LAW;  OR
 (C) ANY ASSIGNEE OF SUCH LENDER OR PUBLIC BENEFIT CORPORATION.
   9. "LENDING INSTITUTION" OR "LENDER" SHALL MEAN ANY ENTITY THAT ITSELF
 OR THROUGH AN AFFILIATE ORIGINATES EDUCATION LOANS, OTHER THAN AN ENTITY
 AUTHORIZED  TO FINANCE THE PURCHASE OR MAKING OF EDUCATION LOANS THROUGH
 THE ISSUANCE OF BONDS PURSUANT TO THE PUBLIC AUTHORITIES LAW.
   10. "PROGRAM" SHALL MEAN THE NEW YORK REINVESTS IN STUDENT EDUCATIONAL
 SUPPORTS PROGRAM ESTABLISHED BY THIS PART.
   11. "STUDENT" SHALL MEAN ANY INDIVIDUAL WHO IS ENROLLED AT LEAST HALF-
 TIME, AS DEFINED BY THE COMMISSIONER,  AT  A  GRADUATE  OR  PROFESSIONAL
 DEGREE GRANTING OR CERTIFICATE PROGRAM AT AN ELIGIBLE COLLEGE.
   §  691. POWERS AND DUTIES. IN FURTHERANCE OF THE PURPOSES SET FORTH IN
 THIS PART, THE AUTHORITY SHALL SERVE AS THE GOVERNING AND  ADMINISTERING
 ENTITY  OF  THE  PROGRAM, AND SHALL HAVE THE FOLLOWING ADDITIONAL POWERS
 AND DUTIES:
   1. TO DIRECTLY ADMINISTER, OR CONTRACT  WITH  ONE  OR  MORE  QUALIFIED
 THIRD-PARTY ENTITIES, INCLUDING LENDING INSTITUTIONS, SERVICERS, PROGRAM
 ADMINISTRATORS,  OR  OTHER  FINANCIAL  ENTITIES,  TO  MARKET, ORIGINATE,
 DISBURSE, SERVICE,  COLLECT,  ADMINISTER,  GUARANTEE,  SECURE,  FINANCE,
 PURCHASE, OR OTHERWISE MANAGE EDUCATION LOANS MADE UNDER THIS PROGRAM.
 S. 10568                            3
 
   2. TO PURCHASE DEFAULTED EDUCATION LOANS MADE UNDER THIS PROGRAM.
   3.  TO  ESTABLISH  AND  MAINTAIN ONE OR MORE DEFAULT RESERVE FUNDS AND
 ACCOUNTS WITHIN SUCH  FUNDS,  IN  ACCORDANCE  WITH  THE  TERMS  OF  THIS
 PROGRAM.
   4.  TO  DEVELOP  AND  ADMINISTER OR CONTRACT TO ADMINISTER ONE OR MORE
 FINANCIAL LITERACY PROGRAMS.
   5. TO PROVIDE OR CONTRACT TO PROVIDE DEFAULT AVERSION SERVICES.
   6. TO ESTABLISH CRITERIA FOR ELIGIBLE  COLLEGES,  LENDERS,  AND  OTHER
 ENTITIES  SUCH  AS,  BUT  NOT  LIMITED  TO, SERVICERS, AND TO ENTER INTO
 PARTICIPATION AGREEMENTS WITH ANY SUCH ELIGIBLE COLLEGES,  LENDERS,  AND
 OTHER  ENTITIES  AND  ANY  ENTITY  AUTHORIZED TO FINANCE THE PURCHASE OR
 MAKING OF EDUCATION LOANS THROUGH THE ISSUANCE OF BONDS PURSUANT TO  THE
 PUBLIC  AUTHORITIES LAW, AND ANY SUBSEQUENT PURCHASER OF EDUCATION LOANS
 MADE UNDER THIS PROGRAM.
   7. TO ESTABLISH  CRITERIA  FOR  LENDER  UNDERWRITING,  EDUCATION  LOAN
 PURCHASES, SERVICING, AND DEFAULT INSURANCE PAYMENTS.
   8.  TO ESTABLISH CRITERIA FOR THE DISTRIBUTION OF EDUCATION LOANS MADE
 UNDER THIS PROGRAM.
   9. TO AUDIT LENDERS, SERVICERS, HOLDERS,  AND  ELIGIBLE  COLLEGES  FOR
 PROGRAM COMPLIANCE.
   10. TO ADOPT RULES AND REGULATIONS TO IMPLEMENT THIS PROGRAM.
   11.  TO  ENTER INTO AGREEMENTS WITH PUBLIC OR PRIVATE ENTITIES FOR THE
 ADMINISTRATION,  SERVICING,   ORIGINATION,   UNDERWRITING,   PROCESSING,
 COMPLIANCE,  CUSTOMER  SERVICE, OR OTHER OPERATIONAL FUNCTIONS NECESSARY
 TO IMPLEMENT THE PROGRAM.
   12. TO PHASE IN SPECIFIC PROGRAM REQUIREMENTS THROUGH RULES AND  REGU-
 LATIONS WITHIN A REASONABLE TIMEFRAME FOLLOWING THE DATE THIS PART TAKES
 EFFECT.
   §  692.  EDUCATION  LOANS;  SPECIAL REQUIREMENTS. IN ANY YEAR IN WHICH
 FIXED RATE EDUCATION LOANS ARE TO BE  ACQUIRED  USING  THE  PROCEEDS  OF
 BONDS  ISSUED  BY  THE  AUTHORITY  OR  OTHER  PUBLIC BENEFIT CORPORATION
 AUTHORIZED TO ISSUE BONDS FOR THE PURPOSES OF THIS  PROGRAM,  PREFERENCE
 SHALL  BE  GIVEN  TO  EDUCATION LOANS MADE TO ELIGIBLE BORROWERS FOR THE
 BENEFIT OF  STUDENTS  WHO  DEMONSTRATE  FINANCIAL  NEED  BASED  ON  SUCH
 STUDENT'S  FAMILY  GROSS  INCOME AND TO EDUCATION LOANS MADE TO ELIGIBLE
 BORROWERS FOR THE BENEFIT OF STUDENTS ACCEPTED OR ENROLLED IN A GRADUATE
 OR PROFESSIONAL DEGREE GRANTING PROGRAM, PURSUANT  TO  RULES  AND  REGU-
 LATIONS PROMULGATED BY THE AUTHORITY AFTER CONSULTATION WITH THE AUTHOR-
 ITY  OR  OTHER  PUBLIC BENEFIT CORPORATION AUTHORIZED TO ISSUE BONDS FOR
 THE PURPOSES OF THIS PROGRAM.
   1. TERMS AND CONDITIONS. (A) ELIGIBLE BORROWERS SHALL APPLY FOR EDUCA-
 TION LOANS UNDER THIS PROGRAM ON FORMS PRESCRIBED BY THE AUTHORITY.
   (B) EXCEPT AS MAY BE PROVIDED BY REGULATION, A  STUDENT  FOR  WHOM  AN
 EDUCATION LOAN IS MADE SHALL BE REQUIRED TO FIRST APPLY FOR AND EXHAUST:
 (I)  THEIR MAXIMUM ELIGIBILITY OF LOANS UNDER THE FEDERAL DIRECT STUDENT
 LOAN PROGRAM (FDSLP), EXCLUDING  PLUS  LOANS;  (II)  ANY  OTHER  FEDERAL
 STUDENT  AID,  OTHER  THAN  HEAL  LOANS  AND  OTHER AID PERMITTED BY THE
 AUTHORITY TO BE EXCLUDED; (III) ANY STATE  STUDENT  AID;  AND  (IV)  ANY
 OTHER  STUDENT  AID AS PRESCRIBED BY THE AUTHORITY BEFORE BEING ELIGIBLE
 FOR ANY EDUCATION LOAN UNDER THIS PROGRAM.
   (C) BORROWERS SHALL SUCCESSFULLY COMPLETE A FINANCIAL LITERACY  COURSE
 AS PRESCRIBED BY THE AUTHORITY.
   (D) STUDENT BORROWERS MAY APPLY FOR EDUCATION LOANS UNDER THIS PROGRAM
 WITH AN ELIGIBLE CO-SIGNER.
   (E)  A  BORROWER, OR CO-SIGNER, WHO IS IN DEFAULT ON AN EDUCATION LOAN
 MADE UNDER THIS PROGRAM, THE WILLIAM D. FORD PROGRAM, OR HAS  FAILED  TO
 S. 10568                            4
 
 COMPLY WITH THE TERMS AND CONDITIONS OF ANY AWARD UNDER THIS ARTICLE AND
 HAS  FAILED  TO  SATISFACTORILY  CURE  SUCH DEFAULT OR NON-COMPLIANCE AS
 PRESCRIBED BY APPLICABLE  LAW  OR  REGULATION  SHALL  BE  INELIGIBLE  TO
 RECEIVE  A  LOAN UNDER THIS PROGRAM, AND SHALL FURTHER BE INELIGIBLE FOR
 ANY OTHER STATE STUDENT AID WHILE IN DEFAULT ON AN EDUCATION  LOAN  MADE
 UNDER THIS PROGRAM.
   (F)  PARTICIPATING  ELIGIBLE COLLEGES, LENDING INSTITUTIONS, AND OTHER
 PARTICIPANTS IN THIS PROGRAM SHALL BE REQUIRED TO ENTER INTO  A  PARTIC-
 IPATION  AGREEMENT  WITH THE AUTHORITY AND COMPLY WITH ALL REPORTING AND
 PROCESSING REQUIREMENTS AND PROCEDURES AS ESTABLISHED BY THE  AUTHORITY.
 THESE  PARTICIPATION  AGREEMENTS SHALL CONTAIN SUCH OTHER SPECIFIC TERMS
 AND CONDITIONS OF THE PROGRAM AS SHALL BE DETERMINED BY THE AUTHORITY.
   2. CITIZENSHIP. A BORROWER SHALL BE:  (A)  A  CITIZEN  OF  THE  UNITED
 STATES; OR (B) A NONCITIZEN LAWFULLY ADMITTED FOR PERMANENT RESIDENCE IN
 THE  UNITED  STATES; OR (C) AN INDIVIDUAL OF A CLASS OF REFUGEES PAROLED
 BY THE ATTORNEY GENERAL OF THE UNITED STATES UNDER THEIR PAROLE AUTHORI-
 TY PERTAINING TO THE ADMISSION OF NONCITIZENS TO THE UNITED STATES.
   3. LOAN LIMITS. EDUCATION LOANS MADE UNDER  THIS  PROGRAM  SHALL  HAVE
 ANNUAL  AND  CUMULATIVE LOAN LIMITS AS APPROVED FROM TIME TO TIME BY THE
 AUTHORITY, SUBJECT TO THE APPROVAL OF THE  AUTHORITY,  OR  OTHER  PUBLIC
 BENEFIT  CORPORATION AUTHORIZED TO ISSUE BONDS UNDER THE PUBLIC AUTHORI-
 TIES LAW FOR PURPOSES OF THIS PROGRAM, WITH RESPECT TO  LOANS  THAT  ARE
 EXPECTED TO BE FINANCED BY SUCH ENTITY.
   4.  INTEREST RATES. THE INTEREST RATE OF LOANS MADE UNDER THIS PROGRAM
 SHALL BE ESTABLISHED IN A MANNER THAT SHALL BE APPROVED AT LEAST ANNUAL-
 LY BY THE AUTHORITY, SUBJECT TO THE APPROVAL OF THE AUTHORITY, OR  OTHER
 SUBJECT  TO  THE  PUBLIC  BENEFIT  CORPORATION AUTHORIZED TO ISSUE BONDS
 UNDER THE PUBLIC AUTHORITIES LAW FOR  PURPOSES  OF  THIS  PROGRAM,  WITH
 RESPECT TO LOANS THAT ARE EXPECTED TO BE FINANCED BY SUCH ENTITY.
   5.  DEFAULT FEE. A PERCENTAGE OF THE EDUCATION LOAN SHALL BE PAID AS A
 DEFAULT FEE, BY OR ON BEHALF OF THE BORROWER OR THE LENDER, IN AN AMOUNT
 TO BE ESTABLISHED AT LEAST ANNUALLY BY  THE  AUTHORITY  SUBJECT  TO  THE
 APPROVAL  OF  THE AUTHORITY, OR OTHER PUBLIC BENEFIT CORPORATION AUTHOR-
 IZED TO ISSUE BONDS UNDER THE PUBLIC AUTHORITIES  LAW  FOR  PURPOSES  OF
 THIS  PROGRAM, WITH RESPECT TO LOANS THAT ARE EXPECTED TO BE FINANCED BY
 SUCH ENTITY. THE DEFAULT FEE ESTABLISHED BY THE  AUTHORITY,  SUBJECT  TO
 THE  APPROVAL  OF  THE  AUTHORITY,  OR  OTHER PUBLIC BENEFIT CORPORATION
 AUTHORIZED TO ISSUE BONDS UNDER THE PUBLIC AUTHORITIES LAW FOR  PURPOSES
 OF THIS PROGRAM, WITH RESPECT TO EDUCATION LOANS THAT ARE EXPECTED TO BE
 FINANCED  BY  SUCH ENTITY, SHALL BE A PERCENTAGE OF THE PRINCIPAL AMOUNT
 OF SUCH LOANS, AS DETERMINED BY THE AUTHORITY, THAT, TOGETHER WITH OTHER
 AMOUNTS ON DEPOSIT IN THE APPLICABLE DEFAULT  RESERVE  FUND,  SHALL  NOT
 EXCEED  AN  AMOUNT  SUFFICIENT  TO ENSURE THAT THE BALANCE OF SUCH FUNDS
 SATISFIES THE OBLIGATIONS OF SUCH DEFAULT RESERVE FUND AND PERMITS  SUCH
 LOANS  TO  BE  FINANCED.  THIS FEE MAY BE CONSIDERED PART OF THE COST OF
 ATTENDANCE FOR THE PURPOSE OF  CALCULATING  THE  LOAN  AMOUNT  FOR  THIS
 PROGRAM  AND  SHALL  BE  TRANSMITTED TO THE AUTHORITY IN ACCORDANCE WITH
 RULES OR REGULATIONS PROMULGATED BY THE AUTHORITY. SUCH FUNDS  SHALL  BE
 DEPOSITED INTO ONE OR MORE RESERVE FUNDS OR RESERVE ACCOUNTS ESTABLISHED
 AND  MAINTAINED  BY  THE  AUTHORITY PURSUANT TO THIS PART. THE AUTHORITY
 SHALL DETERMINE THE AMOUNT NECESSARY TO MAINTAIN THE FISCAL INTEGRITY OF
 THE PROGRAM AND SUPPORT REPAYMENT OBLIGATIONS ASSOCIATED WITH  EDUCATION
 LOANS  MADE  UNDER THIS PROGRAM. THE DEFAULT FEE MAY BE INCLUDED AS PART
 OF THE COST OF ATTENDANCE FOR PURPOSES OF CALCULATING LOAN ELIGIBILITY.
   6. CONSOLIDATION. EDUCATION LOANS MADE PURSUANT TO THIS PROGRAM MAY BE
 ELIGIBLE FOR CONSOLIDATION UPON THE TERMS AND CONDITIONS ESTABLISHED  BY
 S. 10568                            5
 
 THE  AUTHORITY.  ANY  PERSON  CONSOLIDATING  EDUCATION  LOANS UNDER THIS
 PROGRAM SHALL BE CONSIDERED A BORROWER FOR PURPOSES OF THIS PART.
   7. DEFAULT RESERVE FUNDS. (A) THE AUTHORITY MAY ESTABLISH AND MAINTAIN
 ONE  OR  MORE  DEFAULT  RESERVE FUNDS AND ACCOUNTS WITHIN SUCH FUNDS, IN
 ACCORDANCE WITH THE TERMS OF THIS PROGRAM.
   (B) THE AUTHORITY SHALL PROMPTLY DEPOSIT OR TRANSFER INTO SUCH RESERVE
 FUNDS, WITH RESPECT TO EDUCATION LOANS, DESCRIBED  IN  SUCH  PROVISIONS,
 ANY  MONEYS RECEIVED IN CONNECTION WITH THIS PROGRAM OTHER THAN PAYMENTS
 OF PRINCIPAL AND INTEREST OF EDUCATION LOANS THAT  ARE  NOT  IN  DEFAULT
 STATUS,  INCLUDING,  BUT  NOT  LIMITED  TO:  (I) DEFAULT FEES; (II) FEES
 RECEIVED FROM ELIGIBLE COLLEGES; (III) FUNDS RECEIVED FOR THE  REPAYMENT
 OF  DEFAULTED  EDUCATION  LOANS,  THE  UNPAID PRINCIPAL, CAPITALIZED AND
 UNPAID ACCRUED INTEREST OF WHICH HAVE BEEN PAID FROM THE FUNDS,  INCLUD-
 ING  WITHOUT  LIMITATION ALL SUCH AMOUNTS RECEIVED THROUGH THE OPERATION
 OF VOLUNTARY COLLECTION ACTIVITIES, ADMINISTRATIVE WAGE  GARNISHMENT  OR
 CREDIT OF TAX OVERPAYMENTS LESS ANY AMOUNTS RECEIVED FOR COLLECTION FEES
 ASSESSED  BY THE AUTHORITY; (IV) CONTRACTUAL PENALTIES AND SUBSIDY FEES;
 (V) ANY AMOUNT THAT MAY BE  APPROPRIATED  TO  THE  AUTHORITY;  (VI)  ANY
 AMOUNT  RECEIVED BY THE AUTHORITY OR ANY AGENT FROM ANY OTHER SOURCE FOR
 DEPOSIT THEREIN; AND (VII) INTEREST AND INVESTMENT INCOME EARNED BY  THE
 FUNDS.
   8.  LENDER  DUE  DILIGENCE. PARTICIPATING LENDERS SHALL BE REQUIRED TO
 PERFORM ALL DUE DILIGENCE REQUIREMENTS AS PRESCRIBED  BY  THE  AUTHORITY
 AND  INCORPORATED  INTO THE PARTICIPATION AGREEMENT AND INTO REGULATIONS
 PROMULGATED BY THE AUTHORITY.
   9. ELIGIBLE COLLEGE REQUIREMENTS. (A) PARTICIPATING ELIGIBLE  COLLEGES
 SHALL  BE  REQUIRED TO CERTIFY LOAN ELIGIBILITY UPON FORMS PRESCRIBED BY
 THE AUTHORITY AND INCORPORATED  INTO  THE  PARTICIPATION  AGREEMENT  AND
 PURSUANT TO REGULATIONS PROMULGATED BY THE AUTHORITY.
   (B)  PARTICIPATING ELIGIBLE COLLEGES SHALL BE REQUIRED TO CONTRIBUTE A
 ONE PERCENT FEE PRESCRIBED BY THE AUTHORITY, SUBJECT TO THE APPROVAL  OF
 THE  AUTHORITY,  OR OTHER PUBLIC BENEFIT CORPORATION AUTHORIZED TO ISSUE
 BONDS UNDER THE PUBLIC AUTHORITIES LAW FOR  PURPOSES  OF  THIS  PROGRAM,
 WITH  RESPECT  TO LOANS THAT ARE EXPECTED TO BE FINANCED BY SUCH ENTITY,
 BASED UPON THE LOAN DOLLAR VOLUME OR HAVE THE CONTRIBUTION MADE  ON  ITS
 BEHALF,  PURSUANT  TO THE TERMS OF THE PARTICIPATION AGREEMENT. THIS FEE
 SHALL BE DEPOSITED INTO A DESIGNATED ACCOUNT WITHIN ONE OR MORE  RESERVE
 FUNDS  OR  ACCOUNTS ESTABLISHED BY THE AUTHORITY IN SUBDIVISION SEVEN OF
 THIS SECTION AS APPLICABLE. THIS FEE, OR ANY OTHER  COLLEGE  FEE,  SHALL
 NOT  BE  ASSESSED TO THE STUDENT OR ELIGIBLE BORROWER IN CONNECTION WITH
 THIS PROGRAM.
   § 693. REPAYMENT OF LOANS. 1. TERMS OF REPAYMENT. THE TERMS OF  REPAY-
 MENT  OF EDUCATION LOANS MADE UNDER THIS PROGRAM SHALL BE ESTABLISHED IN
 RULES AND REGULATIONS  PROMULGATED  BY  THE  AUTHORITY  SUBJECT  TO  THE
 APPROVAL OF THE AUTHORITY OR OTHER PUBLIC BENEFIT CORPORATION AUTHORIZED
 TO  ISSUE  BONDS  UNDER  THE PUBLIC AUTHORITIES LAW FOR PURPOSES OF THIS
 PROGRAM WITH RESPECT TO LOANS THAT ARE EXPECTED TO BE FINANCED  BY  SUCH
 ENTITY.
   2.  GRACE  PERIOD.  THE  TERMS OF ANY GRACE PERIOD FOR EDUCATION LOANS
 MADE UNDER THIS PROGRAM SHALL BE ESTABLISHED IN  RULES  AND  REGULATIONS
 PROMULGATED BY THE AUTHORITY SUBJECT TO THE APPROVAL OF THE AUTHORITY OR
 OTHER  PUBLIC  BENEFIT  CORPORATION  AUTHORIZED TO ISSUE BONDS UNDER THE
 PUBLIC AUTHORITIES LAW FOR PURPOSES OF  THIS  PROGRAM  WITH  RESPECT  TO
 LOANS  THAT ARE EXPECTED TO BE FINANCED BY SUCH ENTITY. NOTWITHSTANDING,
 THE GRACE PERIOD ESTABLISHED SHALL BE NO LESS THAN SIX MONTHS.
 S. 10568                            6
 
   3. FORBEARANCE AND DEFERMENTS. EDUCATION LOANS MADE UNDER THIS PROGRAM
 SHALL BE ELIGIBLE FOR IN-SCHOOL  AND  MILITARY  DEFERMENTS  PURSUANT  TO
 RULES  AND REGULATIONS PROMULGATED BY THE AUTHORITY, OR PURSUANT TO SUCH
 ADDITIONAL DEFERMENTS AND/OR FORBEARANCE AS OFFERED BY AN ELIGIBLE LEND-
 ER,  IN  EACH  CASE,  SUBJECT TO THE APPROVAL OF THE AUTHORITY, OR OTHER
 AUTHORIZED PUBLIC BENEFIT CORPORATION AUTHORIZED TO  ISSUE  BONDS  UNDER
 THE PUBLIC AUTHORITIES LAW FOR PURPOSES OF THIS PROGRAM, WITH RESPECT TO
 LOANS  THAT ARE EXPECTED TO BE FINANCED BY SUCH ENTITY. UPON THE ASSIGN-
 MENT  OF  A  DEFAULTED  EDUCATION  LOAN  MADE  UNDER  THIS  PROGRAM  FOR
 COLLECTION AS DESCRIBED IN SUBDIVISION FIVE OF THIS SECTION, THE BORROW-
 ER  SHALL  NO LONGER BE ELIGIBLE FOR ANY FORBEARANCE OR DEFERMENTS WHILE
 SUCH LOAN REMAINS IN DEFAULT.
   4. DELINQUENCY. A BORROWER SHALL BE CONSIDERED DELINQUENT ON AN EDUCA-
 TION LOAN UNDER THIS PROGRAM AFTER THIRTY DAYS OF NON-PAYMENT. THE HOLD-
 ER SHALL NOTIFY THE AUTHORITY PROMPTLY AFTER THE FIRST DAY OF DELINQUEN-
 CY AND THE AUTHORITY SHALL UNDERTAKE ACTIONS TO RETURN THE  BORROWER  TO
 REPAYMENT  PURSUANT TO RULES AND REGULATIONS ESTABLISHED BY THE AUTHORI-
 TY.  SUCH ACTIONS SHALL INCLUDE, BUT NOT BE LIMITED TO, ATTEMPTS AT: (A)
 LOCATING AND CONTACTING THE BORROWER AND/OR  CO-SIGNER,  AS  APPLICABLE,
 REGARDING  THE  DELINQUENT  STATUS  OF  THEIR  LOAN;  (B) EXPLAINING THE
 ACCOUNT HISTORY AND CLARIFYING ANY  DISCREPANCIES;  (C)  COUNSELING  THE
 BORROWER AND/OR CO-SIGNER, AS APPLICABLE, REGARDING ALL AVAILABLE REPAY-
 MENT  OPTIONS,  INDUCING DEFERMENTS, AND ANY PUBLIC ASSISTANCE AVAILABLE
 TO THEM; (D) PROVIDING THE BORROWER  AND/OR  CO-SIGNER,  AS  APPLICABLE,
 WITH DOCUMENTATION IN CONNECTION WITH THEIR LOAN OR LOANS; (E) INFORMING
 THE  BORROWER  AND/OR  CO-SIGNER,  AS APPLICABLE, OF THE CONSEQUENCES OF
 DEFAULT; AND (F) ANY OTHER ASSISTANCE THAT WOULD PREVENT A DEFAULT BY  A
 BORROWER.
   5.  DEFAULT.  (A) ANY EDUCATION LOAN UNDER THIS PROGRAM THAT IS DELIN-
 QUENT FOR ONE HUNDRED EIGHTY DAYS  SHALL  BE  DEEMED  IN  DEFAULT.  UPON
 DEFAULT, THE HOLDER SHALL FILE A CLAIM WITH THE AUTHORITY AND, IF APPLI-
 CABLE,  THE  AUTHORITY,  FOR  PAYMENT  FROM  THE NEW YORK EDUCATION LOAN
 PROGRAM VARIABLE RATE DEFAULT RESERVE FUND, THE NEW YORK EDUCATION  LOAN
 PROGRAM  FIXED  RATE  DEFAULT  RESERVE  FUND,  OR THE AUTHORITY NEW YORK
 EDUCATION LOAN PROGRAM DEFAULT RESERVE FUND, AS DESCRIBED IN SUBDIVISION
 SEVEN OF SECTION SIX HUNDRED NINETY-TWO OF  THIS  PART,  AS  APPLICABLE,
 PURSUANT  TO REGULATIONS PROMULGATED BY THE AUTHORITY. UPON RECEIPT OF A
 CLAIM, THE AUTHORITY SHALL NOTIFY THE BORROWER THAT THEIR LOAN IS  BEING
 ASSIGNED TO THE AUTHORITY FOR COLLECTION. THE LENDER, OR HOLDER SHALL BE
 PAID  ONE HUNDRED PERCENT OF THE OUTSTANDING PRINCIPAL, AND OF THE CAPI-
 TALIZED AND UNPAID ACCRUED INTEREST.  UPON  SUCH  PAYMENT,  THIS  AMOUNT
 SHALL BE THE PRINCIPAL OWED BY THE BORROWER.
   (B) ALL COLLECTION PAYMENTS RECEIVED BY THE AUTHORITY FROM A BORROWER,
 OR  ON BEHALF OF BORROWERS, IN DEFAULT ON LOANS MADE UNDER THIS PROGRAM,
 EXCEPT COLLECTION FEES SHALL BE  DEPOSITED  INTO  A  DESIGNATED  ACCOUNT
 WITHIN ONE OR MORE RESERVE FUNDS OR ACCOUNTS ESTABLISHED BY THE AUTHORI-
 TY IN SUBDIVISION SEVEN OF THIS SECTION AS APPLICABLE.
   6.  COLLECTION FEE. THE AUTHORITY SHALL ASSESS A COLLECTION FEE, IN AN
 AMOUNT TO BE DETERMINED BY THE  AUTHORITY  AT  LEAST  ANNUALLY,  ON  ALL
 DEFAULTED EDUCATION LOANS UNDER THIS PROGRAM. THIS FEE SHALL BE RETAINED
 BY  THE  AUTHORITY  FOR THE ADMINISTRATION OF THE PROGRAM. THE AGGREGATE
 ANNUAL REVENUE GENERATED BY SUCH FEE SHALL NOT EXCEED THE  ACTUAL  COSTS
 INCURRED  BY  THE  AUTHORITY,  IN  THE  PRECEDING  YEAR, IN COLLECTING A
 DEFAULTED LOAN UNDER THIS PROGRAM ON WHICH  THE  AUTHORITY  HAS  PAID  A
 CLAIM.  ANY AMOUNTS IN EXCESS OF ACTUAL COST SHALL BE USED TO REDUCE THE
 FEE CHARGED IN THE SUBSEQUENT YEAR.
 S. 10568                            7
 
   7. ADMINISTRATIVE WAGE GARNISHMENT. (A) NOTWITHSTANDING ANY  PROVISION
 OF  LAW  TO THE CONTRARY, THE AUTHORITY SHALL BE ENTITLED TO GARNISH THE
 DISPOSABLE PAY OF AN INDIVIDUAL TO COLLECT THE AMOUNT OWED BY THE  INDI-
 VIDUAL,  IF  SUCH  INDIVIDUAL  FAILS TO MAKE REQUIRED VOLUNTARY PAYMENTS
 UNDER A REPAYMENT AGREEMENT WITH THE AUTHORITY, PROVIDED THAT:
   (I)  THE  AMOUNT  DEDUCTED  FOR ANY PAY PERIOD DOES NOT EXCEED FIFTEEN
 PERCENT OF DISPOSABLE PAY. HOWEVER, THE AMOUNT DEDUCTED FOR  ANY  PERIOD
 MAY EXCEED FIFTEEN PERCENT WITH THE WRITTEN CONSENT OF THE INDIVIDUAL;
   (II)  PRIOR TO GARNISHMENT THE INDIVIDUAL SHALL HAVE BEEN GIVEN THIRTY
 DAYS WRITTEN NOTICE TO THE INDIVIDUAL'S LAST KNOWN ADDRESS ADVISING SUCH
 INDIVIDUAL OF THE NATURE OF THE OBLIGATION, AMOUNT  OF  THE  LOAN  OBLI-
 GATION,  THE  AUTHORITY'S  INTENT  TO  GARNISH AND AN EXPLANATION OF THE
 INDIVIDUAL'S RIGHTS UNDER THIS SECTION INCLUDING THE  RIGHT  TO  INSPECT
 AND COPY RECORDS RELATING TO THE DEBT;
   (III)  THE  INDIVIDUAL SHALL HAVE BEEN GIVEN AN OPPORTUNITY WITHIN THE
 AFOREMENTIONED THIRTY DAYS TO ENTER INTO A WRITTEN  REPAYMENT  AGREEMENT
 WITH THE AUTHORITY TO AVOID GARNISHMENT OF WAGES; AND
   (IV)  THE  INDIVIDUAL  SHALL  HAVE  BEEN PROVIDED AN OPPORTUNITY FOR A
 HEARING PURSUANT TO THE REQUIREMENTS OF PARAGRAPH (F) OF  THIS  SUBDIVI-
 SION.
   (B)  THE  INDIVIDUAL'S  EMPLOYER SHALL PAY TO THE AUTHORITY AMOUNTS AS
 DIRECTED IN THE WITHHOLDING ORDER AND SHALL BE  LIABLE  FOR  FAILURE  TO
 COMPLY  WITH SAID ORDER. THE AUTHORITY MAY SUE AN EMPLOYER IN A COURT OF
 COMPETENT JURISDICTION TO RECOVER FROM  SUCH  EMPLOYER  THE  AMOUNT  THE
 EMPLOYER FAILS TO WITHHOLD FROM THE INDIVIDUAL'S WAGES FOLLOWING RECEIPT
 OF  THE  ORDER OF WITHHOLDING WITH INTEREST THEREON PLUS ATTORNEYS' FEES
 AND COSTS;
   (C) THE NOTICE OF WITHHOLDING SERVED UPON THE EMPLOYER  SHALL  CONTAIN
 ONLY  SUCH  INFORMATION  AS IS NECESSARY FOR THE EMPLOYER TO COMPLY WITH
 THE WITHHOLDING ORDER.
   (D) NO AMOUNT MAY BE DEDUCTED FROM THE WAGES OF AN INDIVIDUAL WHO  HAS
 BEEN  INVOLUNTARILY  SEPARATED  FROM EMPLOYMENT AND HAS NOT BEEN CONTIN-
 UOUSLY EMPLOYED FOR TWELVE MONTHS. AN INDIVIDUAL MUST PROVE  THAT  SEPA-
 RATION  FROM EMPLOYMENT WAS INVOLUNTARY. SEPARATION DUE TO INCARCERATION
 SHALL NOT QUALIFY AS INVOLUNTARY SEPARATION.
   (E) AN EMPLOYER MAY NOT DISCHARGE FROM EMPLOYMENT,  TAKE  DISCIPLINARY
 ACTION  AGAINST  OR REFUSE TO EMPLOY AN INDIVIDUAL BY REASON OF THE FACT
 THAT SUCH INDIVIDUAL'S WAGES ARE SUBJECT TO  AN  ORDER  OF  WITHHOLDING.
 SUCH  INDIVIDUAL  MAY  TAKE  ACTION  AGAINST SAID EMPLOYER IN A COURT OF
 COMPETENT JURISDICTION FOR  REINSTATEMENT,  BACK  PAY  OR  SUCH  FURTHER
 RELIEF AS MAY BE JUST AND NECESSARY.
   (F)  A  HEARING  AS DESCRIBED IN SUBPARAGRAPH (IV) OF PARAGRAPH (A) OF
 THIS SUBDIVISION SHALL BE PROVIDED PRIOR TO AN ORDER OF  WITHHOLDING  IF
 THE  INDIVIDUAL SUBMITS A WRITTEN REQUEST FOR A HEARING ON OR BEFORE THE
 FIFTEENTH DAY FOLLOWING THE NOTICE DESCRIBED  IN  SUBPARAGRAPH  (II)  OF
 PARAGRAPH  (A)  OF  THIS  SUBDIVISION  IN ACCORDANCE WITH PROCEDURES SET
 FORTH BY THE AUTHORITY. IF AN  INDIVIDUAL  FAILS  TO  SUBMIT  A  WRITTEN
 REQUEST  IN THE TIME FRAME PROVIDED, THE AUTHORITY SHALL STILL PROVIDE A
 HEARING UPON RECEIPT OF A WRITTEN REQUEST, BUT SUCH HEARING NEED NOT  BE
 PROVIDED  PRIOR TO AN ORDER OF WITHHOLDING BEING ISSUED TO THE EMPLOYER.
 THE HEARING SHALL NOT BE CONDUCTED BY A PARTY UNDER THE  SUPERVISION  OR
 CONTROL OF THE AUTHORITY EXCEPT THAT NOTHING SHALL PROHIBIT THE AUTHORI-
 TY FROM APPOINTING AN ADMINISTRATIVE LAW JUDGE. A HEARING DECISION SHALL
 BE  ISSUED  NO  LATER  THAN  SIXTY DAYS AFTER THE FILING OF THE PETITION
 REQUESTING THE HEARING.
 S. 10568                            8

   (G) FOR PURPOSES OF THIS SECTION, "DISPOSABLE  PAY"  SHALL  MEAN  THAT
 PART  OF  THE  COMPENSATION OF ANY INDIVIDUAL FROM AN EMPLOYER REMAINING
 AFTER DEDUCTION OF AMOUNTS REQUIRED TO BE WITHHELD BY LAW.
   (H)  ALL  FUNDS RECEIVED THROUGH ADMINISTRATIVE WAGE GARNISHMENT SHALL
 BE DEPOSITED INTO A DESIGNATED ACCOUNT WITHIN ONE OR MORE RESERVE  FUNDS
 OR ACCOUNTS ESTABLISHED BY THE AUTHORITY IN THIS SUBDIVISION AS APPLICA-
 BLE.
   8.  NEW  YORK  STATE  TAX  OFFSET.  THE AUTHORITY SHALL BE ENTITLED TO
 RECEIVE CREDITS OF NEW YORK STATE TAX OVERPAYMENTS PURSUANT  TO  SECTION
 ONE  HUNDRED  SEVENTY-ONE-D  AND  PARAGRAPH  THREE  OF SUBSECTION (E) OF
 SECTION SIX  HUNDRED  NINETY-SEVEN  OF  THE  TAX  LAW  WITH  RESPECT  TO
 DEFAULTED  EDUCATION  LOANS  UNDER  THIS PROGRAM. ALL FUNDS, OR CREDITS,
 RECEIVED THROUGH SUCH TAX OFFSETS SHALL BE DEPOSITED INTO  A  DESIGNATED
 ACCOUNT  WITHIN ONE OR MORE RESERVE FUNDS OR ACCOUNTS ESTABLISHED BY THE
 AUTHORITY IN SUBDIVISION SEVEN OF THIS SECTION AS APPLICABLE.
   9. STATUTE OF LIMITATION. NOTWITHSTANDING ANY PROVISION OF LAW TO  THE
 CONTRARY,  THERE  SHALL  BE  NO  STATUTE OF LIMITATIONS TO BRING SUIT OR
 OTHERWISE COLLECT AN EDUCATION LOAN UNDER  THIS  PROGRAM.  JUDGMENTS  IN
 FAVOR  OF  THE  AUTHORITY  UNDER THIS PROGRAM SHALL NOT EXPIRE AND THERE
 SHALL BE NO STATUTE OF LIMITATIONS UPON WHICH TO ENFORCE OR COLLECT SAID
 JUDGMENT.
   10. CAPACITY OF MINORS. ANY PERSON OTHERWISE QUALIFYING FOR AN  EDUCA-
 TION  LOAN  UNDER  THIS  PROGRAM  SHALL NOT BE DISQUALIFIED BY REASON OF
 BEING UNDER THE AGE OF EIGHTEEN YEARS AND FOR THE PURPOSES  OF  APPLYING
 FOR, RECEIVING AND REPAYING SUCH A LOAN, ANY SUCH PERSON SHALL BE DEEMED
 TO  HAVE FULL LEGAL CAPACITY TO ACT. THE AUTHORITY, IN COLLECTING EDUCA-
 TION LOANS UNDER THIS PROGRAM, SHALL NOT BE SUBJECT TO A DEFENSE  RAISED
 BY ANY BORROWER BASED ON A CLAIM OF INFANCY.
   11.  USURY.  NOTWITHSTANDING ANY PROVISION OF LAW TO THE CONTRARY, THE
 RATE OR AMOUNT OF INTEREST OR FEES PAYABLE ON EDUCATION LOANS MADE UNDER
 THIS PROGRAM SHALL NOT EXCEED TWENTY-FIVE PER CENTUM PER  ANNUM  OR  ITS
 EQUIVALENT RATE FOR A LONGER OR SHORTER PERIOD.
   12.  DEATH  AND DISABILITY DISCHARGE. UPON THE DEATH OF A STUDENT, FOR
 THE FUNDING OF WHOSE HIGHER EDUCATION EXPENSES  AN  EDUCATION  LOAN  WAS
 MADE,  THE  EDUCATION  LOAN  MADE  UNDER  THIS  PROGRAM  SHALL BE DEEMED
 DISCHARGED.  IF SUCH A STUDENT BECOMES TOTALLY AND PERMANENTLY DISABLED,
 THE EDUCATION LOAN UNDER THIS PROGRAM  SHALL  BE  DEEMED  DISCHARGED.  A
 TOTAL  OR  PERMANENT  DISABILITY SHALL MEAN A CONDITION OF AN INDIVIDUAL
 WHO IS UNABLE TO WORK AND EARN MONEY BECAUSE OF  AN  INJURY  OR  ILLNESS
 THAT IS EXPECTED TO CONTINUE INDEFINITELY OR RESULT IN DEATH. THE HOLDER
 OF SUCH DISCHARGED EDUCATION LOANS SHALL BE PAID THE OUTSTANDING PRINCI-
 PAL,  CAPITALIZED  AND  UNPAID  ACCRUED  INTEREST  DUE  FROM ONE OR MORE
 RESERVE FUNDS OR ACCOUNTS ESTABLISHED BY THE  AUTHORITY  IN  SUBDIVISION
 SEVEN OF THIS SECTION AS APPLICABLE.
   13. BANKRUPTCY. EDUCATION LOANS UNDER THIS PROGRAM SHALL BE CONSIDERED
 NON-DISCHARGEABLE  PURSUANT  TO SECTION 523(A)(8) OF THE U.S. BANKRUPTCY
 CODE.
   14. SECURITY INTEREST. NOTWITHSTANDING ANY  OTHER  PROVISION  OF  LAW,
 OTHER  THAN  SECTION ONE THOUSAND SIX HUNDRED EIGHTY-TWO AND SECTION TWO
 THOUSAND FOUR HUNDRED FIVE-A OF THE PUBLIC AUTHORITIES LAW,  A  SECURITY
 INTEREST  IN  EDUCATION LOANS SHALL BE PERFECTED ONLY BY THE FILING OF A
 FINANCING STATEMENT IN THE MANNER PROVIDED UNDER SECTION  9-310  OF  THE
 UNIFORM  COMMERCIAL  CODE,  AND SHALL ATTACH AND BE ASSIGNED PRIORITY IN
 THE MANNER PROVIDED UNDER THE UNIFORM COMMERCIAL CODE  WITH  RESPECT  TO
 SECURITY  INTERESTS  PERFECTED  BY  SUCH  A FILING, AND A DESCRIPTION OF
 COLLATERAL CONSISTING OF EDUCATION  LOANS  IN  ANY  FINANCING  STATEMENT
 S. 10568                            9
 
 SHALL  BE  CONCLUSIVELY  DEEMED TO BE LEGALLY SUFFICIENT IF IT REFERS TO
 RECORDS IDENTIFYING SUCH LOANS RETAINED BY THE AUTHORITY, PROVIDED  THAT
 ANY SUCH SECURITY INTEREST SHALL BE SUBJECT TO ANY APPLICABLE LIEN UNDER
 SECTION  TWO THOUSAND FOUR HUNDRED FIVE-A OF THE PUBLIC AUTHORITIES LAW.
 THE OWNER OF ANY EDUCATION LOAN SHALL ADVISE THE AUTHORITY OF  ANY  SALE
 OR ASSIGNMENT OF SUCH LOAN AT THE TIME AND IN THE MANNER REQUIRED BY THE
 AUTHORITY.
   15. AGREEMENTS. NOTWITHSTANDING ANY OTHER PROVISION OF LAW, ANY ELIGI-
 BLE  PUBLIC  COLLEGE  OR  PUBLIC  CAREER EDUCATION INSTITUTION IS HEREBY
 AUTHORIZED TO ENTER INTO ONE OR MORE AGREEMENTS WITH THE  AUTHORITY  AND
 ANY  ENTITY AUTHORIZED TO FINANCE EDUCATION LOANS PURSUANT TO THE PUBLIC
 AUTHORITIES LAW PROVIDING FOR  THE  PARTICIPATION  OF  SUCH  COLLEGE  OR
 CAREER  EDUCATION  INSTITUTION IN THE PROGRAM AND TO PERFORM OR CONTRACT
 THE PERFORMANCE OF ITS OBLIGATIONS UNDER ANY SUCH AGREEMENT. SUCH  OBLI-
 GATIONS MAY INCLUDE WITHOUT LIMITATION THE PAYMENT OBLIGATIONS DESCRIBED
 IN THIS TITLE.
   §  694. SALE OF EDUCATION LOANS. 1. THE AUTHORITY AND HOLDERS SHALL BE
 AUTHORIZED TO ENTER INTO ONE OR MORE AGREEMENTS FOR THE SALE  OF  EDUCA-
 TION LOANS MADE PURSUANT TO THIS PROGRAM.
   2. EDUCATION LOAN PURCHASES MAY BE FINANCED (A) BY BONDS ISSUED BY THE
 AUTHORITY,  OR  ANY  OTHER  ENTITY  AUTHORIZED  TO  ISSUE BONDS FOR SUCH
 PURPOSE PURSUANT TO THE PUBLIC AUTHORITIES LAW, IN AN AMOUNT APPROVED BY
 THE DIRECTOR OF THE DIVISION OF THE BUDGET; OR (B)  BY  OTHER  NON-STATE
 SOURCES IN AMOUNTS ESTABLISHED PURSUANT TO AN AGREEMENT WITH THE AUTHOR-
 ITY.
   3.  THE  AUTHORITY  SHALL  ESTABLISH THE CRITERIA AND TERMS UPON WHICH
 LENDERS MAY SELL EDUCATION LOANS SUBJECT TO THE APPROVAL OF THE AUTHORI-
 TY OR ANY OTHER ENTITY AUTHORIZED TO ISSUE BONDS UNDER THIS PROGRAM WITH
 RESPECT TO LOANS THAT ARE EXPECTED TO BE FINANCED BY SUCH ENTITY.
   § 694-A. MISCELLANEOUS. 1. NO EDUCATION LOAN SHALL BE  DEEMED  SUBJECT
 TO  SECTION ONE HUNDRED EIGHT OF THE BANKING LAW, TO ARTICLE NINE OF THE
 BANKING LAW OR TO ANY OTHER PROVISIONS OF LAW GOVERNING  THE  QUALIFICA-
 TIONS  TO  MAKE  LOANS  OR THE TERMS OR CONDITIONS OF LOANS DESCRIBED IN
 THIS PART, INCLUDING, WITHOUT LIMITATION, THE INTEREST RATES,  FEES  AND
 CHARGES APPLICABLE THERETO. NEITHER THE AUTHORITY NOR ANY ENTITY AUTHOR-
 IZED  TO  FINANCE EDUCATION LOANS PURSUANT TO THE PUBLIC AUTHORITIES LAW
 SHALL BE SUBJECT TO ANY LICENSING REQUIREMENTS IN  CONNECTION  WITH  ITS
 EDUCATION LENDING ACTIVITIES. NO ENTITY SHALL BE CONSIDERED A LENDER FOR
 PURPOSES  OF ANY OTHER PROVISION OF LAW SOLELY AS A RESULT OF ITS INTER-
 EST IN AN EDUCATION LOAN MADE UNDER THIS PART.
   2. FUNDS MAY BE APPROPRIATED TO THE AUTHORITY OR OTHER ENTITY  AUTHOR-
 IZED  TO  ISSUE BONDS UNDER THIS PROGRAM, FOR THE ADMINISTRATION OF THIS
 PROGRAM.
   3. INTEREST PAID ON EDUCATION LOANS MADE UNDER THIS PROGRAM  SHALL  BE
 ALLOWED  AS  A DEDUCTION IN COMPUTING THE NET TAXABLE INCOME OF ANY SUCH
 PERSON FOR PURPOSES OF ANY INCOME OR FRANCHISE TAX IMPOSED BY THE  STATE
 OR ANY POLITICAL SUBDIVISION THEREOF.
   4.  ANY  AGREEMENT  OF  AN  ENTITY AUTHORIZED TO ISSUE BONDS UNDER THE
 PUBLIC AUTHORITIES LAW FOR PURPOSES OF THIS PROGRAM TO ACQUIRE EDUCATION
 LOANS FROM A LENDER SHALL BE SUBJECT TO THE AVAILABILITY TO SUCH  ENTITY
 OF  FUNDING  FOR SUCH PURPOSE UPON TERMS AND CONDITIONS APPROVED BY SUCH
 ENTITY AND SHALL NOT REQUIRE THE EXPENDITURE BY  SUCH  ENTITY  OF  FUNDS
 FROM  ANY  SOURCE  OTHER  THAN  AMOUNTS OBTAINED THROUGH THE ISSUANCE OF
 BONDS OR NOTES, INCLUDING EARNINGS THEREON, AND ANY APPROPRIATIONS THER-
 EOF.
 S. 10568                           10
 
   5. THE AUTHORITY, ANY  LENDER,  AND  ANY  PUBLIC  BENEFIT  CORPORATION
 AUTHORIZED  TO  ISSUE  BONDS  UNDER  THE  PUBLIC AUTHORITIES LAW FOR THE
 PURPOSES OF THIS PROGRAM SHALL NOT BE SUBJECT TO TITLE FIVE  OF  ARTICLE
 FIVE  OF THE GENERAL OBLIGATIONS LAW WITH RESPECT TO EDUCATION LOANS AND
 SUCH EDUCATION LOANS SHALL NOT BE SUBJECT TO SUCH TITLE.
   6.  TO  THE  EXTENT  THAT THE PROVISIONS OF THIS PART ARE INCONSISTENT
 WITH THE PROVISIONS OF ANY OTHER PART OF THIS ARTICLE, THE PROVISIONS OF
 THIS PART SHALL BE CONTROLLING.
   § 694-B. REPORTING. THE AUTHORITY, AFTER CONSULTATION WITH  ANY  OTHER
 PUBLIC BENEFIT CORPORATION THAT SHALL HAVE ISSUED BONDS UNDER THE PUBLIC
 AUTHORITIES LAW FOR PURPOSES OF THIS PROGRAM, WITH RESPECT TO LOANS THAT
 HAVE  BEEN FINANCED BY OR THAT ARE EXPECTED TO BE FINANCED BY SUCH ENTI-
 TY, SHALL REPORT ANNUALLY WITH RESPECT TO  EDUCATION  LOANS  MADE  UNDER
 THIS  PROGRAM FOR THE PRIOR ACADEMIC YEAR TO THE GOVERNOR, THE TEMPORARY
 PRESIDENT OF THE SENATE, THE SPEAKER OF THE ASSEMBLY,  THE  DIRECTOR  OF
 THE  DIVISION  OF THE BUDGET, THE SENATE FINANCE COMMITTEE, THE ASSEMBLY
 WAYS AND MEANS COMMITTEE AND THE STANDING COMMITTEES OF THE  LEGISLATURE
 HAVING  JURISDICTION  OF  HIGHER  EDUCATION ON THE NUMBER AND CHARACTER-
 ISTICS OF STUDENTS WHO RECEIVED FIXED RATE AND/OR  VARIABLE  RATE  LOANS
 UNDER  THIS  PROGRAM,  INCLUDING,  BUT NOT LIMITED TO, THE INTEREST RATE
 CHARGED, THE DEFAULT AND COLLECTION FEES ESTABLISHED, THE  GRACE  PERIOD
 ESTABLISHED  IF  OTHER  THAN  SIX  MONTHS,  THE  NUMBER  OF STUDENTS WHO
 RECEIVED LOANS THAT DEMONSTRATED FINANCIAL NEED PURSUANT TO SECTION  SIX
 HUNDRED NINETY-TWO OF THIS PART, THE INCOME ESTABLISHED BY THE AUTHORITY
 PURSUANT  TO  SECTION SIX HUNDRED NINETY-TWO OF THIS PART, THE NUMBER OF
 STUDENTS WHO RECEIVED FIXED RATE  LOANS,  THE  NUMBER  OF  STUDENTS  WHO
 RECEIVED  VARIABLE  RATE LOANS, THE NUMBER OF DEFAULT CLAIMS RECEIVED BY
 THE AUTHORITY, THE NUMBER OF BORROWERS SUBJECT  TO  ADMINISTRATIVE  WAGE
 GARNISHMENT,  AND  A LIST OF THE LENDERS AND HOLDERS, IF KNOWN, WHO HAVE
 PROVIDED VARIABLE RATE LOANS.  SUCH ANNUAL REPORT SHALL BE SUBMITTED  BY
 THE  FIRST  DAY OF DECEMBER FOLLOWING THE CLOSE OF THE ACADEMIC YEAR FOR
 WHICH SUCH EDUCATION LOANS WERE MADE.
   § 3. This act shall take effect July 1, 2027.  Effective  immediately,
 the  dormitory  authority  of  the  state  of  New York is authorized to
 promulgate, amend and/or repeal any rule or regulation necessary for the
 implementation of this act on or before such effective date.