Loan Repayment Programs

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THECB 01/2010 Page 1 of 8

PELRP Repayment Amounts

Loan Repayment Programs

Loan repayment programs are authorized by the Texas Legislature to provide educational loan repayment assistance after a specific service is provided. The Texas Higher Education Coordinating Board administers seven loan repayment programs to recruit and retain individuals into certain professions the state determines are critical to fill or incentivize. Repayments are paid annually upon completion of the eligible service, contingent upon availability of funds. The seven loan repayment programs are:

 Physician Education Loan Repayment Program  Dental Education Loan Repayment Program  Children’s Medicaid Loan Repayment Program

 Border County Doctoral Faculty Education Loan Repayment Program  Doctoral Incentive Loan Repayment Program

 Teach for Texas Loan Repayment Program

 Educational Loan Repayment Program for Attorneys Employed by the Office of the Attorney General

Physician Education Loan Repayment Program (PELRP) Purpose

To encourage qualified physicians to practice medicine in a federally designated Health Professional Shortage Area (HPSA) of Texas and provide healthcare services to recipients enrolled in Medicaid, and the Texas Children's Health Insurance Program (CHIP).

Eligibility Requirements

To be eligible to receive loan repayment assistance, a physician must:

 Have completed one, two, three, or four consecutive service periods in a HPSA;  During the service period, have provided direct patient care to Medicaid and

Child-ren’s Health Insurance Program enrollees.

 For loan repayment based on the fourth service period, have earned certification from an American Specialty Board recognized by the American Board of Medical Specialties or the Bureau of Osteopathic Specialists in a primary care specialty, or in a specialty other than primary care if the Department of State Health Services has determined a critical need for the applicant’s specialty in the HPSA where the practice is located.

Award Amount

The maximum aggregate award amount is $160,000. The PELRP is funded through a combination of state general revenue, tuition set-asides, and tobacco tax. Repayment amounts are based on the total eligible student loan debt at the time of acceptance into the program.

Year % of Total _{Eligible Debt} Maximum _Award

First 16% $25,000

Second 22% $35,000

Third 28% $45,000

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The total amounts awarded in each fiscal year from 2006 thru 2009 are shown in the bar chart

included below. The increase in total amounts awarded is tied to the increase in tuition set-asides and other receipts, not increases in general appropriations. In 2009, 54 of the 65 applicants received PELRP awards. The number of recipients who received repayment assistance from FY 2006-2009 and the total amounts awarded are displayed below. In 2007, all applications were funded. In 2008 and 2009 an estimated 11 applications were unfunded, which included ineligible applicants.

Dental Education Loan Repayment Program (DELRP) Purpose

The purpose of the DELRP is to recruit and retain qualified dentists to provide dental services in the areas of the state that are underserved with respect to dental care.

To be eligible for a DELRP, individuals must:

 Have a current license with no disciplinary action from the Texas State Board of Dental Examiners;

 Practice general or pediatric dentistry;  Work at an approved practice site;

 Accept Medicaid assignments as full payment for services and not deny services based on a patient’s inability to pay.

Dentists must practice in federally designated Dental Care Health Professional Shortage Areas

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Target Number of Medicaid Visits for Children Under the Age of 21 (Average per month over a 2 month period) Award Amounts

The maximum annual loan repayment for an eligible dentist providing full-time service is $10,000. A total of $154,000 was awarded to 16 applicants in 2009. All eligible applicants received loan repayment assistance. The amount of available funding for the DELRP has met demand. The program is funded by state general revenue and tuition set-asides. Funding for the DELRP from the Legislature remained constant at $106,477 each year from fiscal year 2006 through 2009. General revenue appropriation increased to $216,477 for each year of the 2010-2011 biennium.

Children’s Medicaid Loan Repayment Program (CMLRP) Purpose

The purpose of the CMLRP is to increase access to healthcare for Medicare-enrolled beneficiaries under the age of 21 by encouraging qualified primary care, specialty, and subspecialty physicians and dentists to participate in the Medicaid program.

To be eligible for the CMLRP, an applicant must:

 Have a license from the appropriate licensing board before applying. Subspecialists must have board certification or be eligible to sit for the applicable subspecialty board

 Have a Medicaid number before applying  Have eligible outstanding loans

 Provide services for four continuous years and meet the appropriate target number of Medicaid visits to children under the age of 21 as listed in chart below for each 12-month service period

Specialty/Subspecialty Year 1 Year 2 Year 3 Year 4 Family Physician, Internal

Medicine and Ob/GYNs 50 80 150 150

Pediatrician 50 80 150 150

Subspecialists 15 24 45 45

General Dentists 50 75 100 100

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THECB 01/2010 Page 4 of 8 CMLRP Loan Repayment by Year Year 1: $40,000 Year 2: $30,000 Year 3: $40,000 Year 4: $30,000 Award Amounts

The maximum aggregate award per recipient is $140,000.The CMLRP is funded by general revenue appropriation made to the Health and Human Services Commission. The Texas Higher Education Coordinating Board distributes the loan repayments to selected eligible applicants. A total of $12 million will be available for approximately 300 awards for the first cohort in fall 2010.

Border County Doctoral Faculty Education Loan Repayment Program (BCDFELRP)

Purpose

The purpose of the BCDFELRP is to recruit and retain persons holding the

doctorate as full-time faculty with instructional duties at Texas institutions of higher education located in counties that border Mexico.

To be eligible for the BCDFELRP, an individual must meet the following requirements:

 Have received a doctoral degree on or after September 1, 1994, from a public or private independent institution of higher education or from an out-of-state institution that is accredited by a recognized accrediting agency

 Work full-time as a doctoral faculty member with instructional duties at an eligible

institution located in a Texas county that borders Mexico (list of eligible institutions below)

 Work full-time as doctoral faculty with instructional duties in the approved institution for one academic year

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Award Amounts

The maximum annual state funded loan repayment for an eligible faculty member is $5,000 for up to 10 years. In 2009, 40 of the 48 applicants received loan repayment assistance totaling $197,813. The BCDELRP is funded through state general revenue.

Doctoral Incentive Loan Repayment Program (DILRP) Purpose

The purpose of the DILRP is to attract members of underrepresented groups to full-time service on the faculties or administrations of public and private or independent institutions of higher education in Texas.

An individual must meet the following eligibility requirements to receive repayment assistance through the DILRP:

 Received a doctoral degree from a college or university that is accredited by a recognized accrediting agency

 Either graduated from or resided in an area in which the nearest high school was one from which only 50 percent or less of the graduating class enrolled in an institutition of higher education following graduation or was classified as a low-income school.

 Qualify for need-based financial assistance while enrolled in a graduate-level degree program

 Have not been employed full-time as a faculty member or administrator with supervisory duties in an eligible institution for more than 12 months

 Have a full-time job offer as a faculty member or an administrator with supervisory duties from, or be negotiating a contract with, an eligible institution

Award Amounts

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Teach for Texas Loan Repayment Program (TFTLRP) Purpose

The purpose of the TFTLRP is to recruit and retain classroom teachers in communities and subjects for which there is an acute shortage of teachers in Texas. The TFTLRP was first created by the Texas Legislature as the Teach for Texas Conditional Grant Program (2000) and the Teach for Texas

Alternative Certification Conditional Grant Program (2002). Both programs were phased out by FY 2005 and converted to the TFTLRP. After the Coordinating Board underwent revision by the Sunset Advisory Commission in 2003, the Coordinating Board was directed to restructure conditional grant programs (also known as loan forgiveness programs) administered by the agency into loan

repayment programs.

To receive repayment assistance through the TFTLRP, an individual must:

 Be currently teaching full-time at the preschool, primary, or secondary level in a Texas public school;

 Be certified in and teach full-time in a field identified by the Texas Education Agency (TEA) as experiencing a teacher shortage during the academic year for which the application is submitted; or

 Be certified and teach full-time at a campus identified by TEA as having a teacher shortage during the academic year for which the application is submitted.

Award Amounts

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Shortage campuses are determined upon receipt of application. Currently, TEA has identified the following as designated shortage fields:

 Mathematics  Science

 Special Education

 Languages other than English  Bilingual/English as a Second Language  Technology Applications  Digital Graphics  Multimedia  Video Technology  Web Mastering

 Independent Study in Technology Applications

 Computer Science I and II  Desktop Publishing

In 2009, 1,000 of 4,823 applicants received loan repayment assistance through the TFTLRP. The total amount awarded was $5,675,047. This program is oversubscribed and many eligible applicants are denied repayment assistance due to insufficient funds.

Educational Loan Repayment Program for Attorneys Employed by the Office of the Attorney General

Purpose

The purpose of this loan repayment program is to recruit and retain attorneys in the Office of the Attorney General (OAG) of the State of Texas.

Award Amounts

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For more information: Office of External Relations

Texas Higher Education Coordinating Board

[email protected]

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Loan Repayment Programs –

Funding & Recipients

2009 & 2010

Physician Education Loan Repayment Program (PELRP) Dental Education Loan Repayment Program (DELRP) Children’s Medicaid Loan Repayment Program (CMLRP) Border County Doctoral Faculty Education Loan Repayment Program (BCDFELRP) Doctoral Incentive Loan Repayment Program (DILRP) Teach for Texas Loan Repayment Assistance Program (TFTLRAP) Education Loan Repayment Program for Attorneys Employed by the Office of the Attorney General (OAGLRP)

Authority Texas Education Code, §§61.531 - 61.540

Texas Education Code, §§61.901 - 61.910 HB 15, §19 and §20, 80th Legislature, Regular Session, 2007 Texas Education Code, §§61.701 - 61.708 Texas Education Code, §§56.091 - 56.096 Texas Education Code, §56.352 Texas Education Code, §§61.9721 - 61.9732 Maximum Annual Award Amount Repayment amounts are based on total eligible student loan debt at the time of acceptance into the program:

Year 1 - 16% of total

eligible debt with a maximum award of $25,000

eligible debt with maximum award of $45,000

$10,000

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Physician Education Loan Repayment Program (PELRP) Dental Education Loan Repayment Program (DELRP) Children’s Medicaid Loan Repayment Program (CMLRP) Border County Doctoral Faculty Education Loan Repayment Program (BCDFELRP) Doctoral Incentive Loan Repayment Program (DILRP) Teach for Texas Loan Repayment Assistance Program (TFTLRAP) Educational Loan Repayment Program for Attorneys Employed by the Office of the Attorney General (OAGLRP) Maximum Aggregate Amount $160,000 N/A $140,000 $50,000 $100,000 $20,000 $18,000 Total Amount Awarded in 2009 $845,455 $154,000 N/A $202,617 $1,078,984 5,675,047 $321,956 Number of 2009 Applicants ₆₅ ₁₆ ₅₂₇ ₈₃ ₇₅ ₄₈₂₃ ₁₀₄ Number of 2009

Recipients ₅₄ ₁₆ N/A – First Cohort to be _{paid Fall 2010} ₄₀ ₅₄ _{! 1,100} ₉₅

Renewals - Number and Percentage for 2009 43 (80%) 11 (69%) N/A 30 (75%) 25 (46%) 702 (64%) 66 (69%) Estimated Funding for FY 2010 General Revenue: $197,047 Unexpended Balance: $1,692,916

Estimated Tuition Set-Asides: $640,000 Estimated Tobacco Tax: $6,489,136 Total: $9,019,099 General Revenue: $216,477 Unexpended Balance: $131,768 Estimated Tuition Set-Asides: $110,000 Total: $458,245

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Physician Education Loan Repayment Program (PELRP) Dental Education Loan Repayment Program (DELRP) Children’s Medicaid Loan Repayment Program (CMLRP) Border County Doctoral Faculty Education Loan Repayment Program (BCDFELRP) Doctoral Incentive Loan Repayment Program (DILRP) Teach for Texas Loan Repayment Assistance Program (TFTLRAP) Educational Loan Repayment Program for Attorneys Employed by the Office of the Attorney General (OAGLRP) Estimated Funding for FY 2011 General Revenue: $197,047

Estimated Tuition Set-Asides: $640,000 Estimated Tobacco Tax: $14,655,289 Total: $15,492,336 General Revenue: $216,477 Estimated Tuition Set-Asides: $110,000 Total: $326,477

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Texas College Student Loan Programs

The Texas Higher Education Coordinating Board administers the Hinson-Hazlewood College Student

Loan Program (HH Loan Program) and the B-On-Time Loan Program (BOT).

The HH Loan Program was created in 1965 to provide low-interest loans to students who are Texas residents and/or are eligible to pay in-state tuition. Because the Coordinating Board does not sell its loans, all loans are serviced at the agency until they are paid in full. Three loan programs comprise the HH Loan Program:

1) College Access Loan (CAL) Program 2) Health Education Loan Program (HELP)

3) Federal Family Education Loan Program (FFELP – Subsidized and Unsubsidized Stafford loans)

The Texas Legislature enacted the BOT in 2003 to provide eligible undergraduate students an incentive to graduate college on time with at least a B average. BOT loans are forgiven if the student graduates on time and fulfills the grade required. The loan carries a zero percent interest rate if the student is not eligible for the forgiveness provision.

Hinson-Hazlewood College Student Loan Program College Access Loan Program

Purpose

The CAL provides alternative education loans to Texas students who are unable to meet the cost of attendance.

Eligible students may borrow an amount up to the cost of attendance less other financial aid each year. Students must meet the following eligibility requirements to access a CAL:

 Be a Texas resident

 Be enrolled at least half-time in a course of study leading to an associate, bachelor, graduate or higher degree or be enrolled in an approved Alternative Educator Certification Program

 Meet the satisfactory academic progress requirements set by the institution

The CAL may be used to cover part or all of the student's Expected Family

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HELP Annual Loan Limits

Field Annual Loan Limit Per Academic Year Lifetime Total Limit  Pharmacy  Public Health Nursing  Allied Health $12,500 $50,000  Medicine Dentistry  Osteopathy Podiatry  Veterinary medicine 20,000 $80,000

have to demonstrate financial need. There are no aggregate loan limits for the CAL.

Students attending universities are the largest borrowers. In 2009, 94.7% of the CAL funds

borrowed were by students enrolled at universities.A three percent origination fee is deducted from the proceeds of each loan if both the borrower and cosigner have a good credit standing. A five percent origination fee is deducted if only one of the parties has a good credit standing.

Health Education Loan Program (HELP) Purpose

The HELP was created to provide educational loans to Texas students enrolled in the following programs of study:  Medicine  Osteopathy  Dentistry  Podiatry  Veterinary medicine  Pharmacy  Public heath  Nursing  Allied health Eligibility Requirements

A student must meet the following eligibility requirements to receive a HELP:  Be a permanent U.S. resident

 Be eligible to pay resident tuition at a public or independent institution of higher education  Be enrolled at least half-time in a course of study leading to a:

Doctor of medicine, osteopathy, dentistry, podiatry, or veterinary medicine degree;

Bachelor's or master of science degree in pharmacy; Graduate degree in public health; or

Associate's, bachelor's, or graduate degree in nursing or allied health  Meet the satisfactory academic progress requirements set by the institution

 Have good credit standing or provide a cosigner who has good credit standing and meets other criteria

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The interest rate for the HELP is a fixed annual 6%. Students enrolled at universities in 2009 ac-counted for 40.3% of borrowers, 5.5% were enrolled in community colleges, and 54.2% were enrolled in public health-related institutions.

Federal Family Education Loan Program (FFELP – Subsidized and Unsubsidized Stafford Loan Program)

Purpose

The purpose of the Federal Family Education Loan Program (FFELP) Subsidized and Unsubsidized Stafford Loan is to provide low interest educational loans that enable a student to pay the cost of attendance at a public or private, non-profit college or university.

Subsidized Loans: The federal government pays the interest on these loans while a

stu-dent is in school, during a grace period, and during authorized periods of deferment.

Unsubsidized Loans: The borrower is responsible for interest that accrues while in school,

during a grace period, or during authorized periods of deferment or forbearance.

A student must meet the following eligibility requirements to receive a FFELP Subsidized and Subsi-dized Stafford Loan:

 Must be a U.S. citizen or an eligible non-citizen

 Have completed a Free Application for Federal Student Aid (FAFSA) and be eligible to receive federal financial aid

 Be enrolled at least half-time

 Meet the satisfactory academic progress requirements of the institution attending Borrowing Limits

FFELP Subsidized Loan Program

The aggregate limit for undergraduate students to borrow is $23,000 and $65,000 for graduate students. Loans that are first disbursed on or after July 1, 2009 will have a fixed annual (sim-ple interest) rate of 5.6% for the life of the loan.

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BOT Annual Loan Amounts for

2009-2010 Four-year institutions (public and private): $6,080 per year Two-year institutions: $1,780 per year

Public technical colleges: $2,680 per year B-On-Time Loan Program

Purpose

The purpose of the BOT is to provide eligible Texas students no-interest loans to attend colleges and universities in Texas. If the student graduates with at least a B average in four-years (or other time-frame depending on degree program), the entire loan amount is forgiven upon graduation. The loan carries a 0% interest rate if the student not be eligible for the forgiveness provision.

The BOT provides an incentive for students to succeed and to graduate on time. Although the stu-dent is required to complete a FAFSA in order to be eligible to apply for the program, a large per-centage of students receiving the loan have financial need. These are TEXAS Grant eligible students that did not receive a TEXAS Grant due to funding shortfalls in that program.

To be eligible for BOT, a student must meet the following requirements:

 Have completed a FAFSA and be eligible to receive federal financial aid

 Be enrolled full-time in an undergraduate degree or certificate program at a public or private institution

 Be a Texas resident or be entitled to pay resident tuition rates as a dependent child of a member of the U.S. armed forces

And

 Have graduated in the 2002-2003 academic year or later from a high school operated by the U.S. Department of Defense or under the Recommended High School Program from a public or accredited private high school in Texas

Or

 Have earned an associate’s degree from an eligible institution no earlier than May 1, 2005 Renewal Eligibility

To maintain eligibility for future disbursements, the student must:

 1st Academic Year - Make satisfactory academic progress toward a degree or certificate as determined by the institution.

 2nd and Subsequent Academic Years - Complete at

least 75% of the semester credit hours attempted (or 24 hours a year) in the most recent academic year and have a cumulative GPA of at least a 2.5 on a 4.0 scale (or the equivalent) on all course work previously attempted.

Forgiveness Requirements

A BOT shall be forgiven if the student receives an undergraduate degree or certificate from an eligible institution and the student either:

 Graduated with a cumulative GPA of at least a 3.0 on a 4.0 scale, within:



Four calendar years after enrollment,



Five calendar years after enrollment if degree is in architecture, engineering, or another program approved by the Coordinating Board, or

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 Graduated with a cumulative GPA of at least 3.0 on a 4.0 scale, with a total number of credit hours (including transfer hours and excluding hours earned exclusively by examination) that is no more than 6 hours beyond what is required to complete the degree or certificate.

History

BOT was not immediately embraced by the financial aid community because of its unique features. With the expectation that the grant could turn into a loan, many institutions steered students away from the program despite the attractive terms. By FY 2008 much of the unknowns and confusion about the program had abated but uncertainty of future funding by the Legislature limited awards in FY 2008-2009 to renewal students. New initial awards have been made in FY 2010.

Due to the short tenure of the program and the long duration (four years) needed to measure suc-cess, the Coordinating Board has limited data to gauge the effectiveness of the forgiveness provi-sion. The entering fall class of 2004 was the first class with enough new awards (4,201 initial awards) to monitor progression through a full four year period (they were to have graduated in 2008). Since February 2010, 2,229 (30%) students have had their loans forgiven. Although there is no “need” component to the BOT program, a large percentage of students receiving the loan have been TEXAS Grant eligible students that did not receive a TEXAS Grant due to funding shortfalls in that program.

Funding Profile

In the current biennium, BOT is funded with $52 million in general revenue and collected tuition set- asides. Collections for FY 2009 totaled $35.2 million and is conservatively estimated to reach $38 million in FY 2010 as designated tuition continues to rise. Since loans to students generally occur in August/September and January, the accumulated prior year set-aside funds are used for new fall loans to assure adequate funds are available for students (loans typically lag set-asides by a year). The table below provides the historical set-aside collections for BOT and the number of loans origi-nated by fiscal year since 2006.

For more information: Office of External Relations

Texas Higher Education Coordinating Board [email protected] 512 427-6111 8,031 10,805 6,819 4,709 0 2,000 4,000 6,000 8,000 10,000 12,000 $0 $10 $20 $30 $40 $50 2006 2007 2008 2009 Millions

B-On-Time - Funds Collected & Loans Originated FY 2006-2009

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Hinson-Hazlewood College Student Loan Program

Loan Comparison Chart Academic Year 2009-2010

Federal Stafford Student

Loan - Subsidized Federal Stafford Student Loan - Unsubsidized College Access Loan (CAL) B-On-Time (BOT) Texas Health Education Loan (HELP)

MAXIMUM ANNUAL LOAN LIMITS Freshman $ 3,500 Sophomore $ 4,500 Junior/Senior $ 5,500 Graduate $ 8,500 Freshman $9,500 Sophomore $10,500 Junior/Senior $12,500 Graduate $20,500 Including SUB amount

Cost of attendance less other financial aid

4-year Public/Private Institutions: $3,040 semester ($6,080yr) 2-year Public/Private Junior Colleges: $890 semester ($1,780yr) Public Technical Colleges: $1,340 semester ($2,680yr)

Pharmacy, Nursing, Allied & Public Health $12,500 Medicine, Dentistry, Osteopathy, Podiatry, Veterinary $20,000 INTEREST RATES 5.6% Fixed 6.80% Fixed 6.00% Fixed or

*3.91%, not to exceed 4% above the rate at which the loan is

issued

No Interest 6.00% Fixed

ELIGIBLE FIELDS

OF STUDY All All All All

Pharmacy, Nursing, Allied Health, Public Health, Medicine, Dentistry, Osteopathy, Podiatry, Veterinary

ORIGINATION FEES _.05% _.05% _{3% or 5%} _3% _{3% or 5%}

AGGREGATE LOAN

LIMITS Undergraduate $ 23,000 _{Graduate $ 65,500} Undergraduate $ 46,000 _{Graduate $138,500} Including SUB amount

N/A _N/A

Pharmacy, Nursing, Allied & Public Health $50,000 Medicine, Dentistry, Osteopathy, Podiatry, Veterinary $80,000

GRACE PERIOD 6 Months 6 Months 6 Months 6 Months 9 Months

ENROLLMENT

REQUIREMENTS At least half time At least half time At least half time Full time At least half time

COSIGNER

REQUIRED N/A N/A Optional N/A Optional

FAVORABLE CREDIT

EVALUATION N/A N/A Borrower and/or Cosigner N/A Borrower and/or Cosigner

REPAYMENT TERMS payment; 10-year repayment $50 minimum monthly period

$50 minimum monthly payment; 10-year repayment

period

$50 minimum monthly payment; up to 20-year repayment period

based on outstanding loan balance $75 minimum monthly payment; 15-year repayment period $50 minimum monthly payment; 25-year repayment period

For more information contact the financial aid office at your institution or call (800)242-3062(outside Austin) or (512) 427-6340 (in Austin area). Visit our website at www.hhloans.com.