49-7-211 - Reimbursement to state for default costs on federal loans.
49-7-211. Reimbursement to state for default costs on federal loans.
(a) The commission shall develop and adopt rules and regulations to require each institution of higher education in this state that participates in the federal Family Education Loan Program or the federal Direct Student Loan Program, under Title IV of the Higher Education Act of 1965 (HEA), compiled in 20 U.S.C. § 1071 et seq., to reimburse the state for its proportionate share of any default cost fee charged to the state by the secretary of education under the HEA. The rules and regulations shall provide a fee structure for determining the amount of the reimbursement for each institution. The fee charged any institution shall be based on the institution's cohort default rate and the state's risk of loss as provided by Section 4201 of the Omnibus Budget Reconciliation Act of 1993, P.L. 103-66, 107 Stat. 323.
(b) Notwithstanding any other law, the rules and regulations may provide that an institution may be exempt from such fees or the commission may adjust an institution's fees if the institution demonstrates that exceptional mitigating circumstances contributed to its high cohort default rate.
(c) The commission shall submit the fee structure and exemption process to the commissioner of finance and administration and the secretary of education for review and approval prior to implementation.
[Acts 1994, ch. 834, § 2.]