Senate File 2118 - Introduced SENATE FILE 2118 BY COMMITTEE ON EDUCATION (SUCCESSOR TO SF 2011) A BILL FOR An Act relating to loan repayment for refinanced student loans 1 under the rural physician loan repayment program, the health 2 care professional recruitment program, and the health care 3 loan repayment program, and including effective date and 4 retroactive applicability provisions. 5 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 6 TLSB 5028SV (2) 88 kh/jh

S.F. 2118 Section 1. Section 261.113, subsection 5, paragraph a, Code 1 2020, is amended to read as follows: 2 a. The amount of loan repayment an eligible student who 3 enters into an agreement pursuant to subsection 3 shall receive 4 if in compliance with obligations under the agreement shall not 5 exceed be forty thousand dollars annually for an eligible loan 6 if the total loan amount equals or exceeds two hundred thousand 7 dollars . Payments under this section may be made for each year 8 of eligible practice during a period of five consecutive years 9 and shall not exceed a total of two hundred thousand dollars. 10 If the total amount of an eligible student’s eligible loan 11 upon graduation is less than two hundred thousand dollars, 12 the commission shall divide the total amount of the eligible 13 student’s eligible loan by five to determine the annual amount 14 of loan repayment the loan recipient is eligible to receive. 15 Sec. 2. Section 261.113, subsection 5, paragraph b, Code 16 2020, is amended by striking the paragraph. 17 Sec. 3. Section 261.113, Code 2020, is amended by adding the 18 following new subsections: 19 NEW SUBSECTION . 5A. Refinanced loans. A loan repayment 20 recipient who refinances an eligible loan by obtaining a 21 private educational loan may continue to receive loan repayment 22 under this section if the amount of loan repayment does not 23 exceed the lesser of the amount specified in subsection 5 or 24 the balance of the loan repayment amount the loan repayment 25 recipient qualified to receive with the eligible loan. 26 NEW SUBSECTION . 5B. Program agreement limitation. The 27 commission shall not enter into more than twenty program 28 agreements annually. The percentage of agreements entered 29 into by students attending eligible universities shall be 30 evenly divided. However, if there are fewer applicants at 31 one eligible university, eligible student applicants enrolled 32 in other eligible universities may be awarded the remaining 33 agreements. 34 Sec. 4. Section 261.115, Code 2020, is amended by adding the 35 -1- LSB 5028SV (2) 88 kh/jh 1/ 3

S.F. 2118 following new subsection: 1 NEW SUBSECTION . 2A. A loan repayment recipient who 2 refinances an eligible loan by obtaining a private educational 3 loan may continue to receive loan repayment under this section. 4 Sec. 5. Section 261.115, subsection 3, Code 2020, is amended 5 to read as follows: 6 3. A health care professional recruitment fund is created in 7 the state treasury as a separate fund under the control of the 8 commission for deposit of moneys appropriated to or received 9 by the commission for use under the program. Notwithstanding 10 section 8.33 , any balance in the fund on June 30 of any fiscal 11 year shall not revert to the general fund of the state but 12 shall remain in the fund and be continuously available for 13 loan forgiveness repayment under the program. Notwithstanding 14 section 12C.7, subsection 2 , interest or earnings on moneys 15 deposited in the fund shall be credited to the fund. 16 Sec. 6. Section 261.116, Code 2020, is amended by adding the 17 following new subsection: 18 NEW SUBSECTION . 4A. Refinanced loans. A loan repayment 19 recipient who refinances a qualified student loan by obtaining 20 a private educational loan may continue to receive loan 21 repayment under this section if the amount of loan repayment 22 does not exceed the lesser of the amount specified in 23 subsection 4 or the balance of the loan repayment amount 24 the loan repayment recipient qualified to receive with the 25 qualified student loan. 26 Sec. 7. EFFECTIVE DATE. This Act, being deemed of immediate 27 importance, takes effect upon enactment. 28 Sec. 8. RETROACTIVE APPLICABILITY. This Act applies 29 retroactively to January 1, 2019, for recipients of loan 30 repayment under sections 261.113, 261.115, and 261.116. 31 EXPLANATION 32 The inclusion of this explanation does not constitute agreement with 33 the explanation’s substance by the members of the general assembly. 34 This bill permits a loan repayment recipient under the rural 35 -2- LSB 5028SV (2) 88 kh/jh 2/ 3

S.F. 2118 physician loan repayment program, the health care professional 1 recruitment program, or the health care loan repayment program 2 to continue to receive loan repayment under the program after 3 refinancing a federal student loan with a private educational 4 loan. However, the loan repayment amount cannot exceed the 5 lesser of the amount of loan repayment allowed under the 6 program or the balance of the loan repayment amount the loan 7 repayment recipient qualified to receive with the federal 8 student loan. 9 The bill amends language limiting the amount of loan 10 repayment available to a recipient under the rural physician 11 loan repayment program to direct that the college student aid 12 commission, upon an eligible student’s graduation, divide the 13 student’s total eligible loan amount by five to determine the 14 annual amount of loan repayment for which the loan recipient 15 is eligible. 16 The bill includes a technical correction and a technical 17 change that moves to a new subsection language limiting the 18 commission to entering into not more than 20 program agreements 19 annually. 20 -3- LSB 5028SV (2) 88 kh/jh 3/ 3