11 Kar 8:010. Teacher Loan Program

Link to law: http://www.lrc.ky.gov/kar/011/008/010.htm
Published: 2015

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      11 KAR 8:010. Teacher Loan Program.


      RELATES TO: KRS 164.770

      STATUTORY AUTHORITY: KRS 164.748(4),



164.770 established the Teacher Loan Program to encourage academically talented

students to become teachers in the public schools of the Commonwealth. This

administrative regulation prescribes rules for the administration of the

Teacher Loan Program. 11 KAR 8:030 establishes a new program of teacher

scholarships pursuant to House Bill 799 (1990 RS), Part I, F., 46., p. 52 and

the corresponding budget memorandum. This amendment is necessary to rename the

program established pursuant to KRS 164.770 to avoid confusion.


      Section 1. Definitions. (1) "Public

school" means a common school operated under the laws of the Commonwealth

of Kentucky.

      (2) "Semester" means a period

of about eighteen (18) weeks, which usually makes up one-half (1/2) of a public

school year or one-half (1/2) of a participating institution's academic year.

      (3) "Qualified teaching

service" means employment in a public school in a position requiring a

Kentucky Teacher's Certificate for a major portion of a school day for at least

seventy (70) days during a semester.

      (4) "Participating institution"

means an institution of higher education located in Kentucky, which is approved

by the State Board of Education to offer teacher education programs, and which

has in force an agreement with the authority providing for administration of

this program.


      Section 2. The Kentucky Higher Education

Assistance Authority (authority) shall, to the extent of appropriations for

such purpose, award teacher loans to persons enrolled or accepted for

enrollment on a full-time basis at participating institutions of higher

education, approved by the State Board of Education to offer teacher education

programs, who declare an intention to enter the teaching profession in the

public schools of the Commonwealth, and who meet the eligibility requirements

set forth herein.


      Section 3. Eligibility Criteria.

Graduates of a high school, located in Kentucky, who rank academically in the

top ten (10) percent of their graduating class, or who score at or above the

80th percentile on a test required for admission to the Commonwealth's public

institutions of higher education, and who have not previously received a

baccalaureate degree, shall be eligible to apply for a teacher loan. An

individual who owes repayment of a grant or work-study award, or who is in

default in repayment of any loan owed to the authority, is not eligible to receive

a teacher loan until all such financial obligations to the authority are

satisfied, provided, however, that ineligibility for this reason may be waived,

at the recommendation of a designated staff review committee for cause.


      Section 4. Selection Criteria. Recipient

selection will be made on the basis of the following weighted criteria: rank in

class (thirty (30) percent), grade point average (forty (40) percent),

percentile score on the test required for admission to the Commonwealth's

public institutions of higher education (thirty (30) percent). (Test scores of

applicants from minority population groups will be measured relative to the

scores of such minority population groups.) If funds are insufficient to award

all applicants, the loans shall first be awarded to those qualifying applicants

who previously received scholarships. If funds are insufficient to award all

prior recipients who are qualified applicants, then loans shall be prorated in

accordance with the cumulative amount previously received by such applicants.

If funds are sufficient to award new applicants, an award shall be made first

to the applicant with the highest score on the selection criteria and,

thereafter, in a descending order to persons having lower scores until all

available funds are awarded. Once all the criteria have been evaluated and two

(2) or more applicants are equally ranked, selection between the applicants

will be made on the basis of the date the application is received by the



      Section 5. Renewal. Teacher loans shall

be renewed annually upon application for a maximum of three (3) years of

undergraduate study for those who maintain at least the equivalent of a 2.5

cumulative grade point average on a scale of 4.0 and provided that the

recipient, when first eligible, enrolls in a teacher education program and,

thereafter, continues to be enrolled on a full-time basis in such a program.

Awards for summer school attendance shall be made upon separate application.


      Section 6. Award Maximums. The maximum

teacher loan award for a summer session shall be $1,250; for a semester shall

be $2,500; or, for an academic year (exclusive of a summer session) shall be

$5,000. The aggregate maximum of teacher loan awards shall not exceed $20,000

per individual. Awards shall not exceed the student's total cost of attendance

as determined by the participating institution.


      Section 7. Disbursements. Disbursement of

teacher loans shall be made at the beginning of each semester or summer session

and each such disbursement shall be evidenced by a promissory note, prescribed

by the authority, in which the loan recipient shall agree to repay the loan

funds or render qualified teaching service in lieu thereof.


      Section 8. Notifications. Recipients

shall notify the authority within thirty (30) days of:

      (1) Change in enrollment status;

      (2) Cessation of enrollment in a teacher

education program;

      (3) Employment in a qualified teaching

service position; or,

      (4) Change of address.


      Section 9. Withdrawals. Loan recipients

who, prior to completion, cease to be enrolled on a full-time basis in a

teacher education program at a participating institution, shall immediately

become liable for the repayment to the authority of the sum of all teacher loan

funds received plus interest accrued thereon unless such recipient has an

approved deferment pursuant to 11 KAR 8:020.


      Section 10. Repayment. Recipients who do

not begin employment in a qualified teaching service position within the six

(6) month period following completion of a teacher education program in a

participating institution (excluding periods of deferment pursuant to 11 KAR

8:020) shall immediately become liable to the authority for repayment of

principal and interest accrued, pursuant to the earliest promissory note then

outstanding. In each semester thereafter, during which a recipient does not

render qualified teaching service, repayment of an additional promissory note

shall become due, proceeding sequentially from the promissory note having the

earliest date to the most recent date.


      Section 11. Repayment Schedule. Written

notification of demand for repayment shall be sent by the authority to the loan

recipient's last known address and shall be effective upon mailing. The

authority may agree, in its sole discretion, to accept repayment in

installments in accordance with a schedule established by the authority. In the

event that more than one (1) promissory note has come due for repayment and

remains unpaid, then payments shall first be applied to the earliest unpaid

promissory note. Payments shall be applied first to accrued interest and then

to principal.


      Section 12. Cancellation. (1) In order to

receive cancellation of a promissory note and the interest accrued thereon, a

loan recipient must render qualified teaching service in a public school during

a semester. One (1) such promissory note shall be cancelled for each semester

during which qualified teaching service is verified to the authority. Such

cancellations of promissory notes shall be in sequential order beginning with

the earliest promissory note.

      (2) In the event that a recipient has

received loans or scholarships from more than one (1) program administered by

the authority, which require a period of qualified teaching service for

repayment or cancellation, such teaching requirements shall not be fulfilled

concurrently. Unless the authority determines otherwise for cause, loans or

scholarships from more than one (1) program shall be repaid or cancelled by

qualified teaching service in the same order in which they were received.

      (3) Verification of qualified teaching

service shall be submitted to the authority in writing, signed by the local

school district superintendent or building principal, within thirty (30) days

of the date a scholarship recipient completes such qualified teaching service.


      Section 13. Interest. The interest rate

on loan funds shall be twelve (12) percent per annum simple interest. Interest

accruing on the unpaid principal of each promissory note shall be computed from

the date of disbursement of the respective promissory note, and such interest

shall continue to accrue until the promissory note is paid in full pursuant to

Section 11 of this administrative regulation or cancelled in full pursuant to

Section 12 of this administrative regulation. In the event that the loan is not

repaid or cancelled in accordance with the terms of the promissory note and

related repayment schedules, if any, and judgment is rendered on the debt, then

the annual interest rate shall, from the date of such judgment, not exceed four

(4) percent in excess of the discount rate on ninety (90) day commercial paper

in effect at the Federal Reserve Bank in the Federal Reserve District where the

transaction is consummated or nineteen (19) percent, provided that it shall not

be less than the face rate of the promissory note.


      Section 14. Records. A participating

institution shall maintain complete and accurate records pertaining to the

eligibility, enrollment and progress of students receiving aid under this

program and the disbursement of funds and institutional charges as may be

necessary to audit the disposition of funds hereunder. Such records shall be

maintained for at least five (5) years after the student ceases to be enrolled

at the institution.


      Section 15. Refunds. A participating

institution shall refund to the authority, within forty (40) days of a

recipient's last date of attendance, any amount attributable to this program

which is determined to be due under the institution's refund policy.


      Section 16. Information Dissemination and

Recruitment. The authority shall disseminate information through high school

counselors and school superintendents about this program to potential

recipients. Participating institutions shall provide assurances that program

information will be disseminated to freshmen and sophomores enrolled at that

institution. Participating institutions shall actively recruit students from

minority population groups for participation in this program. (13 Ky.R. 94; Am.

503; eff. 8-12-86; 1613; 1853; eff. 4-14-87; 16 Ky.R. 2694; eff. 8-9-90.)