EDUCATION CODE
CHAPTER 52. STUDENT LOAN PROGRAM
SUBCHAPTER A. ADMINISTRATION
§ 52.01. ADMINISTRATION. The Texas Higher Education
Coordinating Board, or its successors, shall administer the student
loan program authorized by this chapter pursuant to Article III,
Sections 50b, 50b-1, 50b-2, 50b-3, 50b-4, and 50b-5 of the Texas
Constitution. Personnel and other expenses required to properly
administer this chapter shall be funded by:
(1) the general appropriations acts; or
(2) any other source of revenue received by the board
in connection with the operation of the student loan program.
Acts 1971, 62nd Leg., p. 3072, ch. 1024, art. 1, § 1, eff. Sept.
1, 1971. Amended by Acts 1993, 73rd Leg., ch. 571, § 2, eff. Aug.
30, 1993; Acts 1995, 74th Leg., ch. 300, § 1; Acts 1999, 76th
Leg., ch. 144, § 1.
§ 52.02. DELEGATION OF POWERS AND DUTIES. The board may
delegate to the commissioner of higher education the powers,
duties, and functions authorized by this chapter, except those
relating to the sale of bonds and the letting of contracts for
insurance.
Acts 1971, 62nd Leg., p. 3072, ch. 1024, art. 1, § 1, eff. Sept.
1, 1971.
§ 52.03. BOARD INTEREST AND SINKING FUNDS. (a) The
board by resolution may establish one or more interest and sinking
funds as accounts in the state treasury.
(b) A board interest and sinking fund established under this
section consists of deposits made by the board as provided by this
chapter.
(c) A board interest and sinking fund established under this
section may be used for any purpose related to the student loan
program.
(d) The board by resolution may create and provide the terms
of administration and use of one or more accounts in a board
interest and sinking fund established under this section.
Added by Acts 1993, 73rd Leg., ch. 571, § 4, eff. Aug. 30, 1993.
§ 52.04. BOARD STUDENT LOAN FUNDS. (a) The board by
resolution may establish one or more board student loan funds as
accounts in the state treasury.
(b) A board student loan fund established under this section
consists of deposits made by the board as provided by this chapter.
(c) A board student loan fund established under this section
may be used for any purpose related to the student loan program.
(d) The board by resolution may create and provide the terms
of administration and use of one or more accounts in a board student
loan fund established under this section.
Added by Acts 1993, 73rd Leg., ch. 571, § 4, eff. Aug. 30, 1993.
SUBCHAPTER B. BONDS
§ 52.11. ISSUANCE OF BONDS. (a) The board may from
time to time provide by resolution for the issuance of negotiable
bonds in a total aggregate amount not exceeding $285 million.
(b) All bonds shall be on a parity and shall be called the
Texas College Student Loan Bonds.
(c) The proceeds from the sale of bonds shall be placed in
the Texas Opportunity Plan Fund.
(d) To assure the orderly and economical marketing of the
bonds and the reasonable availability of money in the Texas
Opportunity Plan Fund, the bonds may be issued in installments.
(e) The bonds of each issue shall be dated and shall bear
interest at rates prescribed by the board, subject to the
limitations imposed by law. At the option of the board, the
interest may be payable annually or semiannually.
(f) The bonds shall mature serially or otherwise not later
than 40 years from their date and may be redeemable before maturity,
at the option of the board, at a price or prices and under terms and
conditions fixed by the board in the resolution providing for the
issuance of the bonds.
(g) The board shall determine the form of the bonds,
including the form of any interest coupon to be attached to the
bonds, and shall fix the denomination or denominations of the bonds
and the place or places for the payment of the principal and
interest.
(h) The bonds shall be executed on behalf of the
coordinating board, or its successor, as general obligations of the
State of Texas in the following manner: They shall be signed by the
chairman or vice chairman and the secretary of the board, and the
seal of the board shall be impressed on them. They shall be signed
by the governor and attested by the secretary of state and the state
seal impressed on them. The resolution authorizing the issuance of
any installment or series of bonds may prescribe the extent to which
facsimile signatures and facsimile seals may be used in executing
the bonds and appurtenant coupons. Interest coupons may be signed
with the facsimile signatures of the chairman or vice chairman and
the secretary of the board. In the event any officer whose manual
or facsimile signature appears on any bond or coupon ceases to hold
that office before the delivery of the bond or coupon, the signature
will nevertheless be valid and sufficient for all purposes as if he
had remained in office until the delivery had been made.
(i) The resolution may provide for registration of the bonds
as to ownership and for successive conversion and reconversion from
registered to bearer bonds and vice versa.
(j) Before any of the bonds issued are delivered to the
purchasers, the record pertaining to the bonds shall be examined by
the attorney general and the records and the bonds shall be approved
by him. After approval by the attorney general, the bonds shall be
registered in the office of the comptroller of public accounts.
When approved, registered, and delivered to the purchasers, the
bonds are incontestable and constitute general obligations of the
State of Texas.
(k) The performance of official duties prescribed by
Article III, Section 50b, of the Texas Constitution, in reference
to the provision for the payment and the payment of the bonds may be
enforced in any court of competent jurisdiction through mandamus or
other appropriate proceedings.
(l ) All bonds issued in accordance with the provisions of
this chapter are negotiable instruments under the laws of this
state.
(m) The board may provide for the replacement of any bond
which is mutilated, lost, or destroyed.
(n) This section applies only to bonds issued under Article
III, Section 50b, of the Texas Constitution.
Acts 1971, 62nd Leg., p. 3072, ch. 1024, art. 1, § 1, eff. Sept.
1, 1971. Amended by Acts 1993, 73rd Leg., ch. 300, § 28, eff.
Aug. 30, 1993; Acts 1993, 73rd Leg., ch. 571, § 5, eff. Aug. 30,
1993.
§ 52.12. REFUNDING BONDS. (a) The board may provide by
resolution for the issuance of refunding bonds for the purpose of
refunding any bonds issued under the provisions of this chapter and
then outstanding, together with accrued interest on them.
(b) The issuance of the refunding bonds, the maturities, and
all other details of the bonds, the rights of the holders, and the
duties of the board with respect to the bonds, shall be governed by
the applicable provisions of Section 52.11 of this code.
(c) The refunding bonds may be exchanged for the outstanding
bonds or may be sold and the proceeds used to retire the outstanding
bonds.
Acts 1971, 62nd Leg., p. 3072, ch. 1024, art. 1, § 1, eff. Sept.
1, 1971.
§ 52.13. BONDS AS INVESTMENTS. All bonds issued
pursuant to the provisions of this chapter are legal and authorized
investments for banks, savings banks, trust companies, building and
loan associations, insurance companies, fiduciaries, trustees, and
guardians, and for the sinking funds of cities, towns, villages,
counties, school districts, and all other political subdivisions
and public agencies of the State of Texas. The bonds, when
accompanied by all unmatured coupons appurtenant to them, are
lawful and sufficient security for all deposits of state funds and
of all funds of any agency or political subdivision of the state,
and of counties, school districts, cities, and all other municipal
corporations or subdivisions at the par value of the bonds. The
bonds and the income from them, including the profits made on their
sale, shall at all times be free from taxation in this state.
Acts 1971, 62nd Leg., p. 3072, ch. 1024, art. 1, § 1, eff. Sept.
1, 1971.
§ 52.14. SALE OF BONDS. When the board has authorized
the issuance of a series of bonds and has determined to call for
bids on the bonds, it shall publish an appropriate notice of the
sale at least one time not less than 20 days before the date of the
sale. The publication shall be made in a daily newspaper of general
statewide circulation which is published not less than seven times
weekly. The notice shall also be published for a number of times
determined by the board in one or more recognized financial
publications of general circulation published in the state and one
or more of these publications published outside the state. The
board shall demand of bidders, other than the administrators of the
state funds, that each bid be accompanied by an exchange or bank
cashier's check for a sum considered adequate by the board to be a
forfeit guaranteeing the acceptance of and payment for all bonds
covered by each bid accepted by the board.
Acts 1971, 62nd Leg., p. 3072, ch. 1024, art. 1, § 1, eff. Sept.
1, 1971.
§ 52.15. COMPETITIVE BIDS. No installment or series of
bonds may be sold for an amount less than the face value of all the
bonds comprising the installment or series with accrued interest
from their date, and all bonds shall be sold after competitive
bidding to the highest and best bidder. The board may reject any
and all bids.
Acts 1971, 62nd Leg., p. 3072, ch. 1024, art. 1, § 1, eff. Sept.
1, 1971.
§ 52.16. PROCEEDS FROM BOND SALE. All proceeds from the
sale of bonds authorized by Article III, Section 50b, 50b-1, or
50b-2 of the Texas Constitution shall be deposited in the state
treasury in the Texas Opportunity Plan Fund.
Acts 1971, 62nd Leg., p. 3072, ch. 1024, art. 1, § 1, eff. Sept.
1, 1971. Amended by Acts 1993, 73rd Leg., ch. 571, § 6, eff. Aug.
30, 1993.
§ 52.17. INTEREST AND SINKING FUNDS. (a) Each fiscal
year a sufficient portion of the funds received by the board as
repayment of student loans granted under this chapter, as interest
on the loans, and as other available funds relating to the student
loan program shall be deposited in the state treasury in the Texas
college interest and sinking fund or a board interest and sinking
fund to pay the interest and principal coming due during the ensuing
fiscal year and to establish and maintain a reserve in the interest
and sinking fund equal to the average annual principal and interest
requirements of all outstanding bonds issued under this chapter
that are secured by funds in the Texas college interest and sinking
fund or a board interest and sinking fund.
(b) If in any year funds are received in excess of the
foregoing requirements, then the excess may be:
(1) deposited in the Texas Opportunity Plan Fund, the
student loan auxiliary fund, or a board interest and sinking fund;
(2) used to pay any costs of the board related to the
operation of the student loan program;
(3) used for any lawful purpose related to the student
loan program; or
(4) used for the same purposes and upon the same terms
and conditions prescribed for the proceeds derived from the sale of
the bonds.
(c) In the event that funds received by the board in any
fiscal year as repayment of student loans and as interest on the
loans are insufficient to pay the interest coming due and the
principal maturing on the bonds during the ensuing fiscal year, the
comptroller shall transfer into the Texas college interest and
sinking fund and each board interest and sinking fund out of the
first money coming into the treasury, which is not otherwise
appropriated by the constitution, an additional amount sufficient
to pay the interest coming due and the principal maturing on the
bonds during the ensuing fiscal year.
(d) The resolution authorizing the issuance of the bonds may
provide for the deposit, from bond proceeds, of not more than 24
months' interest, and may provide for the use of bond proceeds as a
reserve for the payment of principal of and interest on the bonds.
(e) Amounts paid to the board by the federal Lender's
Special Allowance program may be deposited in the Texas college
interest and sinking fund, a board interest and sinking fund, or
used for the administration of student loan and grant programs and
the Teacher Loan Program and Future Teacher Loan Program authorized
under House Bill 72, 68th Legislature, 2nd Called Session, 1984, or
other programs administered by the board as specified by the
legislature in the General Appropriations Act.
(f) With respect to loans granted under this chapter, the
board shall file semiannually with the Bond Review Board a report on
the performance of the loans, the Texas college interest and
sinking fund, and each board interest and sinking fund. The Bond
Review Board shall review the reports filed by the board under this
subsection to assess the performance of the loans under this
chapter, the Texas college interest and sinking fund, and each
board interest and sinking fund. The filing dates and the contents
of the reports must comply with any rules adopted by the Bond Review
Board.
Acts 1971, 62nd Leg., p. 3072, ch. 1024, art. 1, § 1, eff. Sept.
1, 1971. Amended by Acts 1985, 69th Leg., ch. 518, § 1, eff. June
12, 1985; Acts 1991, 72nd Leg., 1st C.S., ch. 4, § 13.05, eff.
Aug. 22, 1991; Acts 1993, 73rd Leg., ch. 571, § 7, eff. Aug. 30,
1993; Acts 1997, 75th Leg., ch. 1423, § 5.10, eff. Sept. 1,
1997; Acts 2001, 77th Leg., ch. 1420, § 8.214, eff. Sept. 1,
2001.
§ 52.18. DUTIES OF COMPTROLLER. The comptroller of
public accounts shall make the transfers required under the
provisions of this chapter and shall pay or cause to be paid the
principal of and interest on the bonds as they mature and come due.
Acts 1971, 62nd Leg., p. 3072, ch. 1024, art. 1, § 1, eff. Sept.
1, 1971. Amended by Acts 1997, 75th Leg., ch. 1423, § 5.11, eff.
Sept. 1, 1997.
§ 52.19. INVESTMENT OF FUNDS. All money in the Texas
college interest and sinking fund and in each board interest and
sinking fund, including the reserve portion, and all money in the
Texas Opportunity Plan Fund and in the student loan auxiliary fund
in excess of the amount necessary for student loans, and all money
in each board student loan fund shall be invested by the comptroller
in the investments prescribed by board resolution. The board shall
furnish to the comptroller a copy of the resolution prescribing
authorized investments. The board may sell any instruments owned
in the Texas college interest and sinking fund, a board interest and
sinking fund, the Texas Opportunity Plan Fund, the student loan
auxiliary fund, or a board student loan fund at the prevailing
market price. Income from these investments may be deposited in any
of those funds.
Acts 1971, 62nd Leg., p. 3072, ch. 1024, art. 1, § 1, eff. Sept.
1, 1971. Amended by Acts 1991, 72nd Leg., ch. 4, § 2, eff. Feb.
28, 1991; Acts 1991, 72nd Leg., 2nd C.S., ch. 5, § 2, eff. Aug.
29, 1991; Acts 1993, 73rd Leg., ch. 571, § 8, eff. Aug. 30, 1993;
Acts 1997, 75th Leg., ch. 1423, § 5.12, eff. Sept. 1, 1997.
§ 52.20. STUDENT LOAN NOTES. (a) Promissory notes
evidencing student loans made by the board with proceeds from bonds
may be deposited and held in any fund as directed by the board
resolution that authorized the issuance of the bonds.
(b) The board may pledge and grant a security interest in
all or any portion of those promissory notes to any person to
further secure the payment of principal and interest on bonds
issued under this chapter or of obligations under any contracts
entered into by the board relating to the issuance of a series of
bonds.
Added by Acts 1993, 73rd Leg., ch. 571, § 9, eff. Aug. 30, 1993.
SUBCHAPTER C. STUDENT LOANS
§ 52.31. PARTICIPATING INSTITUTIONS. A participating
higher educational institution is any institution of higher
education, public or private nonprofit, including a junior college,
which is recognized or accredited by the Texas Education Agency or
the Coordinating Board, Texas College and University System, or its
successors, and which complies with the provisions of this chapter
and the rules and regulations of the board promulgated in
accordance with this chapter.
Acts 1971, 62nd Leg., p. 3072, ch. 1024, art. 1, § 1, eff. Sept.
1, 1971.
§ 52.32. QUALIFICATIONS FOR LOANS. (a) The board may
authorize loans from the Texas Opportunity Plan Fund to qualified
students if the applicant:
(1) is a resident of Texas as defined by the board in
accordance with Subchapter B, Chapter 54 of this code;
(2) has been accepted for enrollment at any
postsecondary educational institution within the State of Texas,
public or private, which has been approved by an agency of the
United States government for the purpose of guaranteeing the maker
of such loans against loss due to the death, disability, or default
of the borrower. If the postsecondary institution that the student
has been accepted to attend was not a participating institution as
defined in Section 52.31 of this code on May 1, 1985, the applicant
must provide evidence that he is unable to obtain a guaranteed
student loan from a commercial lender except as provided by
Subsection (b) of this section;
(3) has established that he has insufficient resources
to finance his college education;
(4) has been recommended by reputable persons in his
home community; and
(5) has complied with other requirements established
by the rules and regulations adopted by the board in conformity with
this chapter.
(b) If a loan applicant is enrolled at a career school or
college in a degree program that is approved by the board, the
applicant is not required to provide evidence that the applicant is
unable to obtain a guaranteed student loan from a commercial lender
under Subsection (a)(2) of this section.
(c) In no event may a higher standard of academic
performance be required of an applicant than the minimum standard
required for enrollment in the participating institution. The
student must be meeting the minimum academic requirements of the
institution in the semester any loan is made.
(d) It is the legislature's intent that the Texas
Opportunity Plan Fund provide loan assistance to an applicant who:
(1) is ineligible for assistance under federal
guidelines; and
(2) has insufficient resources to finance a college
education.
Acts 1971, 62nd Leg., p. 3072, ch. 1024, art. 1, § 1, eff. Sept.
1, 1971. Amended by Acts 1985, 69th Leg., ch. 892, § 1, eff.
Sept. 1, 1985; Acts 1987, 70th Leg., 2nd C.S., ch. 23, § 1, eff.
Aug. 3, 1987; Acts 1989, 71st Leg., ch. 1084, § 2.01, eff. Sept.
1, 1989; Acts 2003, 78th Leg., ch. 364, § 2.01, eff. Sept. 1,
2003; Acts 2003, 78th Leg., ch. 817, § 8.16, eff. Sept. 1, 2003.
§ 52.321. STANDARDS CONCERNING ABILITY TO REPAY CERTAIN
LOANS. In establishing requirements to be met by applicants for
student loans authorized by the board under this chapter, the board
may not establish standards relating to demonstration of ability to
repay a federally insured student loan that are stricter for a
certain class of applicants than for other applicants, except in
cases where the applicant attends a school with a loan default rate
of 15 percent or more.
Added by Acts 1989, 71st Leg., ch. 1084, § 2.02, eff. Sept. 1,
1989.
§ 52.33. AMOUNT OF LOAN. The amount of the loan to any
qualified applicant shall be limited to the difference between the
financial resources available to him, including but not limited to
his income from parents and other sources, scholarships, gifts,
grants, other financial aid, and the amount he can reasonably be
expected to earn, and the amount necessary to pay his reasonable
expenses as a student at the participating institution of higher
education where he has been accepted for enrollment, under the
rules and regulations adopted by the board. The total loan to any
individual student may never be more than the amount he can
reasonably be expected to repay in a maximum period of 10 years
after he is last enrolled in a participating institution, except as
otherwise provided for in this chapter.
Acts 1971, 62nd Leg., p. 3072, ch. 1024, art. 1, § 1, eff. Sept.
1, 1971. Amended by Acts 1987, 70th Leg., 2nd C.S., ch. 23, § 2,
eff. Aug. 3, 1987.
§ 52.34. PAYMENTS TO STUDENT. (a) No payment may be
made to any student until the student has executed a note payable to
the Texas Opportunity Plan Fund for the full amount of the
authorized loan plus interest.
(b) For the purposes of this chapter, a student has the
capacity to contract and is bound by any contract executed by the
student, and the defense that the student was a minor at the time
the student executed the note is not available to the student in any
action arising on the note.
(c) Payments to students executing notes may be made
annually, semiannually, quarterly, monthly, or for each semester as
the board may determine, depending on the demonstrated capacity of
the student to manage the student's financial affairs.
(d) Disbursements may be made by the board or by the
participating institution pursuant to a contract between the board
and the institution executed in conformity with this chapter.
(e) Money may be distributed to a participating institution
only to make payments to a student under a loan authorized by this
chapter.
(f) The board shall distribute money to a participating
institution through the electronic funds transfer system
maintained by the Texas Guaranteed Student Loan Corporation for
disbursing loan funds from commercial lenders participating in the
guaranteed student loan program under Chapter 57, except that at
the request of a participating institution the board may distribute
the money through other means. The board shall enter into a
contract with the corporation for the use of the system, and the
corporation shall make the system available to the board as
necessary to carry out this subsection.
Acts 1971, 62nd Leg., p. 3072, ch. 1024, art. 1, § 1, eff. Sept.
1, 1971. Amended by Acts 2003, 78th Leg., ch. 820, § 45, eff.
Sept. 1, 2003.
§ 52.35. TERM OF LOANS. The term of all authorized
loans must be for the shortest possible period, as determined by the
board. However, no loan may be made to any student for a period
longer than 10 years from the date he is last enrolled in a
participating institution.
Acts 1971, 62nd Leg., p. 3072, ch. 1024, art. 1, § 1, eff. Sept.
1, 1971. Amended by Acts 1971, 62nd Leg., p. 3339, ch. 1024, art. 2,
§ 7, eff. Sept. 1, 1971; Acts 1987, 70th Leg., 2nd C.S., ch. 23,
§ 3, eff. Aug. 3, 1987.
§ 52.36. LOAN INTEREST AND FEES. (a) The board shall
from time to time fix the interest to be charged for any student
loan at a rate sufficient to pay the interest on outstanding bonds,
any expenses incident to their issuance, sale, and retirement, and
all or a portion of the board's expenses related to the operation of
the student loan program. Interest shall be postponed by the board
as long as a student is enrolled at a participating institution and
may be postponed at the board's discretion as long as a student is
enrolled at any other higher educational institution, provided that
the total interest paid is to be equal to that fixed at the time the
note evidencing the loan is executed.
(b) The board may charge and collect loan origination fees
from borrowers for use in offsetting in whole or in part the
operating expenses for the loans.
Acts 1971, 62nd Leg., p. 3072, ch. 1024, art. 1, § 1, eff. Sept.
1, 1971. Amended by Acts 1979, 66th Leg., p. 785, ch. 347, § 1,
eff. June 6, 1979; Acts 1987, 70th Leg., 2nd C.S., ch. 23, § 4,
eff. Aug. 3, 1987; Acts 1993, 73rd Leg., ch. 571, § 10, eff. Aug.
30, 1993.
§ 52.37. INSURANCE. The board may contract with any
insurance company or companies licensed to do business in Texas for
insurance on the life of any student borrower in an amount
sufficient to retire the principal and interest owed under a loan
made under the provisions of this chapter. The cost of the
insurance shall be paid by the student borrower. No contract for
insurance as provided for in this section may be approved except by
the board during a regular meeting attended by a quorum of the total
board membership.
Acts 1971, 62nd Leg., p. 3072, ch. 1024, art. 1, § 1, eff. Sept.
1, 1971.
§ 52.38. REPAYMENT OF LOANS. Repayment of any loan and
interest authorized under this chapter shall be made monthly and
shall begin not later than nine months after the date the student
borrower is last enrolled in a participating institution or any
other institution of higher education and in no event later than
five years from the date the first note evidencing a loan under this
chapter is executed. The board may, however, authorize a longer
period before beginning repayment of loans to medical students,
dental students, and other students seeking professional or
graduate degrees. The board may extend the time for beginning
repayment for unusual financial hardships, with the approval of the
attorney general. Repayment shall be made directly to the board or
to a participating institution pursuant to a contract executed by
the board in accordance with its rules and regulations.
Acts 1971, 62nd Leg., p. 3072, ch. 1024, art. 1, § 1, eff. Sept.
1, 1971. Amended by Acts 1971, 62nd Leg., p. 3339, ch. 1024, art. 2,
§ 7, eff. Sept. 1, 1971.
§ 52.39. DEFAULT; SUIT. When any person who has
received a loan authorized by this chapter has failed or refused to
make as many as six monthly payments due in accordance with an
executed note, then the full amount of the remaining principal and
interest becomes due and payable immediately, and the amount due,
the person's name and his last known address, and other necessary
information shall be reported by the board to the attorney general.
Suit for the remaining sum shall be instituted by the attorney
general, or any county or district attorney acting for him, in the
county of the person's residence, the county in which is located the
institution at which the person was last enrolled, or in Travis
County, unless the attorney general finds reasonable justification
for delaying suit and so advises the board in writing.
Acts 1971, 62nd Leg., p. 3072, ch. 1024, art. 1, § 1, eff. Sept.
1, 1971.
§ 52.40. CANCELLATION OF CERTAIN LOAN
REPAYMENTS. (a) The board may cancel the repayment of a loan
received by a student who earns a doctorate of psychology degree and
who is employed by the Texas Youth Commission, Texas Department of
Human Services, Texas Department of Corrections, or Texas
Department of Mental Health and Mental Retardation prior to the
date on which repayment of the loan is to commence.
(b) A person who wishes to apply for a loan cancellation
shall enter into a contract with the board which contains the
following provisions:
(1) No payment is due from the person as long as he is
employed by one of the designated state agencies.
(2) Half of the total amount of the loan plus interest
due is to be cancelled after two years of the appropriate service,
and the remainder is to be cancelled after two additional years of
service.
(3) Repayment of the loan and interest is to commence
immediately if the person leaves the designated state agency before
the expiration of two years; repayment of one-half of the loan and
interest is to commence immediately if the person leaves the
designated state agency after completing two years service; upon
completion of four years service, the loan, principal and interest,
shall be fully cancelled.
(4) Interest continues to accrue until the loan is
cancelled or repaid.
(c) Loans and interest on loans may be cancelled under the
Texas Opportunity Plan Fund in any year in a total amount not to
exceed the amount appropriated for that purpose from general
revenue funds.
(d) The board shall publicize the availability of the loan
cancellation procedures provided in this section at all
institutions of higher education which offer graduate programs in
psychology.
Added by Acts 1975, 64th Leg., p. 1344, ch. 503, § 1, eff. Sept.
1, 1975. Amended by Acts 1984, 68th Leg., 2nd C.S., ch. 28, art.
III, part K, § 1, eff. Sept. 1, 1984; Acts 1985, 69th Leg., ch.
264, § 33, eff. Aug. 26, 1985; Acts 1985, 69th Leg., ch. 517,
§ 2, eff. Sept. 1, 1985; Acts 1989, 71st Leg., ch. 1084, §
2.03, eff. Sept. 1, 1989.
§ 52.41. RESTRICTION ON ISSUANCE OF CERTAIN FEDERALLY
INSURED STUDENT LOANS. (a) Except as provided by Subsection (c),
the board may issue a student loan under the Federal Family
Education Loan Program (20 U.S.C. Section 1071 et seq.), as
amended, only to a borrower who has been or will be issued a student
loan under another student loan program administered by the board.
(b) The board may service any outstanding student loans
issued by the board under the Federal Family Education Loan
Program.
(c) The board may issue student loans under the Federal
Family Education Loan Program to borrowers other than borrowers
described by Subsection (a) if the commissioner of higher education
determines that market conditions warrant the issuance of those
loans.
Added by Acts 2003, 78th Leg., ch. 820, § 46, eff. Sept. 1, 2003.
SUBCHAPTER D. GENERAL PROVISIONS
§ 52.501. DEFINITIONS. In this chapter:
(1) "Board" means the Texas Higher Education
Coordinating Board.
(2) "Board interest and sinking fund" means an
interest and sinking fund established by the board under Section
52.03 of this code.
(3) "Board student loan fund" means a student loan
fund established by the board under Section 52.04 of this code.
(4) "Bond" means a general obligation bond issued by
the board under Article III, Section 50b, 50b-1, 50b-2, 50b-3,
50b-4, or 50b-5 of the Texas Constitution.
(5) "Student loan program" means the student loan
program administered by the board under this chapter.
Added by Acts 1993, 73rd Leg., ch. 571, § 1, eff. Aug. 30, 1993.
Amended by Acts 1995, 74th Leg., ch. 300, § 2; Acts 1999, 76th
Leg., ch. 144, § 2.
§ 52.51. ADVISORY COMMITTEES. The board may appoint
advisory committees from outside its membership as it deems
necessary to assist it in achieving the purposes of this chapter.
Acts 1971, 62nd Leg., p. 3072, ch. 1024, art. 1, § 1, eff. Sept.
1, 1971.
§ 52.52. CONTRACTS. (a) Except as provided by this
section, in achieving the goals outlined in this chapter and the
performance of functions assigned to it, the board may contract
with any other state governmental agency as authorized by law, with
any agency of the United States, and with corporations,
associations, partnerships, and individuals.
(b) The board may not make an agreement with a guarantor
concerning any insured student loans the board authorizes that
requires the board to file suit or take other action to collect on a
defaulted loan beyond the 365th day after the official default date
occurs on the loan, unless such a requirement is imposed by the
guarantor on other lenders making the same kind of insured student
loans.
(c) Not later than January 1, 1991, the board shall amend
its contract with the United States Department of Education that
requires the board to file suit to obtain judgment on a defaulted
loan before filing a claim on the defaulted loan with the guarantor
to reflect the requirement in Subsection (b) of this section.
(d) The board may approve and enter into agreements that are
necessary for the operation of the student loan program or that
relate to the issuance of bonds.
Acts 1971, 62nd Leg., p. 3072, ch. 1024, art. 1, § 1, eff. Sept.
1, 1971. Amended by Acts 1989, 71st Leg., ch. 1084, § 2.04, eff.
Sept. 1, 1989; Acts 1993, 73rd Leg., ch. 571, § 11, eff. Aug. 30,
1993.
§ 52.521. FILING OF CLAIMS ON LOANS IN
DEFAULT. (a) The board shall file a claim with the appropriate
guarantor on an insured loan in default as soon as it is practicable
to do so in accordance with the guarantor's rules.
(b) The board shall deposit funds obtained as a result of
any claims, including claims filed on loans in default that have
been litigated as provided under a contract with the United States
Department of Education, filed with a guarantor in the Texas
Opportunity Plan Fund or in the student loan auxiliary fund in the
appropriate account to be used for making student loans.
Added by Acts 1989, 71st Leg., ch. 1084, § 2.05, eff. Sept. 1,
1989. Amended by Acts 1991, 72nd Leg., 2nd C.S., ch. 5, § 3.
§ 52.53. GIFTS AND GRANTS. The board may accept gifts,
grants, or donations of real or personal property from any
individual, group, association, or corporation or the United
States, subject to limitations or conditions set by law. The board
shall deposit gifts, grants, or donations of money in the Texas
Opportunity Plan Fund or in the student loan auxiliary fund and
shall separately account for and expend the funds in accordance
with the specific purpose for which given and under such conditions
as are imposed by the donor and as provided by law.
Acts 1971, 62nd Leg., p. 3072, ch. 1024, art. 1, § 1, eff. Sept.
1, 1971. Amended by Acts 1991, 72nd Leg., 2nd C.S., ch. 5, § 4.
§ 52.54. RULES AND REGULATIONS. (a) The board shall
adopt and publish rules and regulations to effectuate the purposes
of this chapter in accordance with and under the conditions applied
to other agencies by Chapter 274, Acts of the 57th Legislature,
Regular Session, 1961, as amended (Article 6252-13, Vernon's Texas
Civil Statutes).
(b) The board may adopt rules and regulations necessary for
participation in the federal guaranteed loan program provided by
the Higher Education Act of 1965 (Public Law 89-329).
Acts 1971, 62nd Leg., p. 3072, ch. 1024, art. 1, § 1, eff. Sept.
1, 1971. Amended by Acts 1971, 62nd Leg., p. 3340, ch. 1024, art. 2,
§ 7, eff. Sept. 1, 1971.
§ 52.541. ACCOUNTS FOR LOAN PROGRAMS. (a) The board
shall establish separate accounting within the Texas Opportunity
Plan Fund and the student loan auxiliary fund for each of its
existing loan programs, including accounting for the federally
insured loans that are insured by the United States Department of
Education, the federally insured loans that are insured by the
United States Department of Health and Human Services, and each
loan program that consists of loans insured by the State of Texas.
(b) If a loan program is established after September 1,
1989, the board shall establish separate accounting within the
Texas Opportunity Plan Fund and the student loan auxiliary fund for
that loan program.
(c) The board may transfer funds among the separate accounts
established under this section if:
(1) the transfer is approved by the board and is
necessary to administer the Texas Opportunity Plan Fund or the
student loan auxiliary fund; and
(2) the reason for the transfer is documented in the
accounting of the funds.
Added by Acts 1989, 71st Leg., ch. 1084, § 2.06, eff. Sept. 1,
1989. Amended by Acts 1991, 72nd Leg., 2nd C.S., ch. 5, § 4.
§ 52.55. AUDIT. All transactions under the provisions
of this chapter are subject to audit by the state auditor.
Acts 1971, 62nd Leg., p. 3072, ch. 1024, art. 1, § 1, eff. Sept.
1, 1971.
§ 52.56. ANNUAL REPORT. (a) The board shall make a
report of the operations of the Texas Opportunity Plan and of the
student loan auxiliary fund to the governor annually and to the
legislature not later than December 1 prior to the regular session
of the legislature.
(b) The report shall include, for the state as a whole and
for each participating institution, the following information:
(1) the number of loans;
(2) the maximum loan;
(3) the minimum loan;
(4) the total amount of loans made;
(5) a list of persons who have failed or refused to
make as many as six monthly payments on any note, showing the amount
due and the person's last known address; and
(6) any other information that will describe the
effectiveness of the loan program.
(c) The board shall include in its annual report under this
section a report of the loans authorized by the board that are in
default. The board shall report the data concerning any loans in
default in a form that is similar to the reporting of loan default
data by the Texas Guaranteed Student Loan Corporation for a
commercial lender participating in the student loan program under
Chapter 57 of this code.
Acts 1971, 62nd Leg., p. 3072, ch. 1024, art. 1, § 1, eff. Sept.
1, 1971. Amended by Acts 1989, 71st Leg., ch. 1084, § 2.07, eff.
Sept. 1, 1989; Acts 1991, 72nd Leg., 2nd C.S., ch. 5, § 5.
SUBCHAPTER E. COLLEGE SAVINGS BONDS
§ 52.61. DEFINITIONS. In this subchapter:
(1) "College savings bond" means a general obligation
bond issued by the board under Article III, Section 50b-2, of the
Texas Constitution.
(2) "Postsecondary educational institution" includes
an institution of higher education as that term is defined by
Section 61.003 of this code and private institutions approved for
purposes of the tuition equalization program under Subchapter F of
Chapter 61 of this code.
Added by Acts 1989, 71st Leg., ch. 1084, § 2.08.
§ 52.62. ESTABLISHMENT OF SAVINGS BONDS PROGRAM; USE OF
BOND PROCEEDS. (a) The college savings bonds program is
established to provide the public with a method of saving that
encourages enrollment at postsecondary educational institutions.
(b) The college savings bonds issued by the board under this
subchapter are part of the Texas Opportunity Plan Fund, and the
proceeds from the bonds shall be invested as provided by Subchapter
B of this chapter and may be used for student loans as provided by
Subchapter C of this chapter.
(c) The proceeds from the college savings bonds issued under
this subchapter may be used for the costs associated with the
issuance of the bonds, including the cost of marketing the bonds.
Added by Acts 1989, 71st Leg., ch. 1084, § 2.08.
§ 52.63. PUBLIC PURPOSE. The legislature finds and
declares that this subchapter:
(1) by authorizing the issuance of general obligation
bonds as college savings bonds provides the public with a method of
saving that encourages enrollment at postsecondary educational
institutions; and
(2) by encouraging enrollment at postsecondary
educational institutions, this subchapter promotes the public
welfare and economic development of this state and, consequently,
serves an important public purpose.
Added by Acts 1989, 71st Leg., ch. 1084, § 2.08.
§ 52.64. ADMINISTRATION OF SAVINGS BONDS PROGRAM;
RULES. (a) The board shall administer the college savings bonds
program.
(b) The board may adopt any rules necessary to administer
this subchapter.
Added by Acts 1989, 71st Leg., ch. 1084, § 2.08.
§ 52.65. EFFECT ON OTHER FINANCIAL AID. In determining
the eligibility of a student for a scholarship, grant, or other
monetary assistance awarded by a state agency, an amount of $10,000
or less in proceeds from savings bonds, including principal and
accumulated interest, may not be considered in determining the
amount or form of financial assistance to provide to the student.
Added by Acts 1989, 71st Leg., ch. 1084, § 2.08.
§ 52.66. AUTHORITY TO ISSUE. (a) The board shall issue
and sell college savings bonds in a total aggregate amount not
exceeding $75 million authorized under Article III, Section 50b-2,
of the Texas Constitution.
(b) The college savings bonds may be sold in the manner and
in the amounts determined by the board and as provided by this
subchapter.
(c) College savings bonds may be sold at a negotiated sale
if the board determines that a negotiated sale will result in either
a more efficient and economic sale of the college savings bonds or
greater access to the college savings bonds by residents of this
state.
(d) If any college savings bonds are sold at a negotiated
sale, the underwriter to whom those bonds are sold must, in the
judgment of the board, have sufficient capability to make a broad
distribution of those bonds to investors resident in this state.
Added by Acts 1989, 71st Leg., ch. 1084, § 2.08.
§ 52.67. SECURITY OF SAVINGS BONDS; GENERAL
OBLIGATION. The college savings bonds authorized under Article
III, Section 50b-2, of the Texas Constitution and issued in
accordance with this subchapter are general obligations of this
state.
Added by Acts 1989, 71st Leg., ch. 1084, § 2.08.
§ 52.68. TERMS. (a) Savings bonds issued under this
subchapter must mature serially or otherwise not more than 25 years
after they are issued.
(b) The college savings bonds:
(1) must be zero coupon bonds, capital appreciation
bonds, compound interest bonds, municipal multiplier bonds,
capital accumulator bonds, or a similar type of bond that will
encourage the purchaser to hold the bond until maturity; and
(2) must be issued in small denominations of $1,000 or
less at a price the board determines to be the most advantageous
reasonably obtainable and that renders the bonds attractive for the
purpose of financing the costs of higher education.
(c) The college savings bonds may not be redeemed by the
state before maturity.
Added by Acts 1989, 71st Leg., ch. 1084, § 2.08.
§ 52.69. DETERMINATION OF AGGREGATE PRINCIPAL AMOUNT OF
BONDS. The aggregate principal amount of the college savings bonds
issued under this subchapter shall be the aggregate of the initial
offering prices, not including accrued interest, at which those
bonds are offered for sale to the public, including private or
negotiated sales, or sold to the initial purchasers in a private
placement, without a reduction for an underwriter's discount or
fees of a placement agent or other intermediary.
Added by Acts 1989, 71st Leg., ch. 1084, § 2.08.
§ 52.70. MARKETING AND DISTRIBUTION OF BONDS. (a) The
board shall coordinate the marketing and distribution of the
college savings bonds.
(b) The board may use its staff to assist in the marketing
and distribution of the college savings bonds or may contract with
another entity for services to carry out some or all of those
duties.
(c) In marketing the college savings bonds, the board shall
emphasize the use of those bonds to finance the costs of higher
education.
Added by Acts 1989, 71st Leg., ch. 1084, § 2.08.
§ 52.71. MANDAMUS. The performance of official duties
prescribed by this subchapter and Article III, Section 50b-2, of
the Texas Constitution, in reference to the payment of the college
savings bonds, may be enforced in a court of competent jurisdiction
by mandamus or other appropriate proceedings.
Added by Acts 1989, 71st Leg., ch. 1084, § 2.08.
§ 52.72. REPLACEMENT OF BOND. The board may provide for
the replacement of any college savings bond that is mutilated,
lost, or destroyed.
Added by Acts 1989, 71st Leg., ch. 1084, § 2.08.
§ 52.73. APPROVAL AND REGISTRATION. (a) College
savings bonds issued by the board and the records relating to their
issuance must be submitted to the attorney general for examination
as to their validity.
(b) If the attorney general finds that the college savings
bonds have been authorized in accordance with law, the attorney
general shall approve them, and the comptroller of public accounts
shall register the bonds.
(c) Following approval and registration, the college
savings bonds are incontestable and are binding obligations
according to their terms.
Added by Acts 1989, 71st Leg., ch. 1084, § 2.08.
§ 52.74. EXEMPTION FROM TAXATION. College savings
bonds issued under this subchapter may not be taxed by the state or
any of its political subdivisions.
Added by Acts 1989, 71st Leg., ch. 1084, § 2.08.
SUBCHAPTER F. ADDITIONAL BONDS
§ 52.81. DEFINITIONS. In this subchapter:
(1) "Board" means the Texas Higher Education
Coordinating Board.
(2) "Bond" means a general obligation bond issued by
the board under Article III, Section 50b-3, 50b-4, or 50b-5 of the
Texas Constitution.
(3) "Fund" means the student loan auxiliary fund.
Added by Acts 1991, 72nd Leg., 2nd C.S., ch. 5, § 1. Amended by
Acts 1995, 74th Leg., ch. 300, § 3; Acts 1999, 76th Leg., ch.
144, § 3.
§ 52.82. ISSUANCE; SALE. (a) The board may by
resolution authorize the issuance of general obligation bonds in
total aggregate amounts not to exceed:
(1) $300 million under Section 50b-3, Article III,
Texas Constitution;
(2) $300 million under Section 50b-4, Article III,
Texas Constitution; and
(3) $400 million under Section 50b-5, Article III,
Texas Constitution.
(b) Before the board may issue bonds under this subchapter,
the Bond Review Board must review and approve the bonds under
Chapter 1231, Government Code.
(c) The board may sell the bonds at a negotiated sale if the
board determines that a negotiated sale is a more efficient and
economical method of selling the bonds.
(d) The total amount of bonds issued by the board in a state
fiscal year may not exceed $125 million.
Added by Acts 1991, 72nd Leg., 2nd C.S., ch. 5, § 1. Amended by
Acts 1995, 74th Leg., ch. 300, § 4; Acts 1999, 76th Leg., ch.
144, § 4; Acts 2001, 77th Leg., ch. 1420, § 8.215, eff. Sept.
1, 2001; Acts 2003, 78th Leg., ch. 779, § 2, eff. June 20, 2003.
§ 52.83. TERMS. (a) Except as provided by this
subchapter, the board by resolution may provide the terms and name
of the bonds.
(b) The bonds must be dated and bear interest at a rate or
rates prescribed by the board in accordance with the resolution for
the issuance of the bonds, except that the rate may not exceed the
maximum net effective rate allowed by law. The resolution may
provide for:
(1) any type of rate, including a fixed, variable,
floating, or adjustable rate; and
(2) any arrangement for the periodic determination of
interest rates, including a formula, index, or contract.
(c) The bonds must mature serially or otherwise not later
than the 40th year after the date of their issuance.
(d) The bonds may have a different face value from other
bonds issued by the board.
Added by Acts 1991, 72nd Leg., 2nd C.S., ch. 5, § 1. Amended by
Acts 1993, 73rd Leg., ch. 571, § 12, eff. Aug. 30, 1993.
§ 52.84. EXECUTION; REGISTRATION. The resolution
authorizing the issuance of the bonds may provide for the manner of
execution and for the registration of ownership of the bonds.
Added by Acts 1991, 72nd Leg., 2nd C.S., ch. 5, § 1.
§ 52.85. MARKETING; DISTRIBUTION. (a) The board
shall coordinate the marketing and distribution of the bonds.
(b) The board may use its staff to market and distribute the
bonds or may contract with another entity to market and distribute
the bonds.
Added by Acts 1991, 72nd Leg., 2nd C.S., ch. 5, § 1.
§ 52.86. APPROVAL AND REGISTRATION. (a) The attorney
general shall examine the bonds and the records relating to the
bonds' issuance.
(b) If the attorney general finds that the bonds have been
issued in accordance with law, the attorney general shall approve
the bonds, and the comptroller of public accounts shall register
the bonds.
(c) Following approval and registration, the bonds are
incontestable and are binding obligations according to their terms.
Added by Acts 1991, 72nd Leg., 2nd C.S., ch. 5, § 1.
§ 52.87. MANDAMUS. The performance of official duties
prescribed by this subchapter and Article III, Sections 50b-3,
50b-4, and 50b-5 of the Texas Constitution, in reference to the
payment of the bonds, may be enforced in a court of competent
jurisdiction by mandamus or other appropriate proceedings.
Added by Acts 1991, 72nd Leg., 2nd C.S., ch. 5, § 1. Amended by
Acts 1995, 74th Leg., ch. 300, § 5; Acts 1999, 76th Leg., ch.
144, § 5.
§ 52.88. REPLACEMENT OF BOND. The board may provide for
the replacement of a bond that is mutilated, lost, or destroyed.
Added by Acts 1991, 72nd Leg., 2nd C.S., ch. 5, § 1.
§ 52.89. FUND. (a) A special fund to be known as the
student loan auxiliary fund is created in the state treasury.
(b) The fund consists of proceeds from the sale of the bonds
deposited in accordance with this section, gifts or grants made to
the board for purposes of the fund, and deposits made as authorized
by this chapter.
(c) The board shall deposit to the credit of the fund any
proceeds from the sale of bonds, excluding:
(1) any accrued interest on the bonds which shall be
deposited in the board interest and sinking fund relating to the
bonds; and
(2) proceeds from the sale of bonds issued by the board
under Section 56.464(b) to provide Texas B-On-time student loans.
(c-1) Notwithstanding Subsection (c), proceeds from the
sale of bonds issued by the board under Section 56.464(b) to provide
Texas B-On-time student loans may be deposited to the credit of the
fund by resolution of the board.
(d) The board by resolution may create and provide the terms
of the administration and use of an interest and sinking account or
other accounts in the fund.
Added by Acts 1991, 72nd Leg., 2nd C.S., ch. 5, § 1. Amended by
Acts 1993, 73rd Leg., ch. 571, § 13, eff. Aug. 30, 1993; Acts
2003, 78th Leg., ch. 779, § 3, eff. June 20, 2003.
§ 52.90. LOANS FROM FUND. (a) The board:
(1) shall make a loan from the fund to a student who
qualifies for a loan under Subchapter C; and
(2) may make a loan from the fund to a student who
qualifies for a Texas B-On-time student loan under Subchapter Q,
Chapter 56.
(b) Loans from the fund are governed by Subchapter C of this
chapter or Subchapter Q, Chapter 56, as appropriate, as if made
under that subchapter, except to the extent of conflict with this
subchapter.
(c) The board may charge and collect a loan origination fee
from a person who receives a loan from the fund. The board may use
the fee to pay operating expenses for making loans under this
section.
Added by Acts 1991, 72nd Leg., 2nd C.S., ch. 5, § 1. Amended by
Acts 2003, 78th Leg., ch. 779, § 4, eff. June 20, 2003.
§ 52.91. BONDS FOR TEXAS B-ON-TIME STUDENT LOAN
PROGRAM. (a) The board shall deposit to the credit of the Texas
B-On-time student loan account established under Section 56.463 any
proceeds from the sale of bonds issued by the board to fund Texas
B-On-time student loans under Section 56.464(b), other than:
(1) accrued interest on the bonds, which shall be
deposited to the credit of the interest and sinking fund related to
the bonds; and
(2) any proceeds from the sale of the bonds that the
board by resolution deposits to the student loan auxiliary fund
under Section 52.89(c-1).
(b) The board by resolution may establish as provided by
Section 52.03 one or more interest and sinking funds to be used for
any purpose relating to the Texas B-On-time student loan program
established under Subchapter Q, Chapter 56.
(c) The board shall repay bonds issued by the board to fund
the Texas B-On-time student loan program using legislative
appropriations and money collected by the board as repayment for
Texas B-On-time student loans awarded by the board. The board may
not use money collected by the board as repayment for student loans
awarded by the board under Subchapter C to repay bonds issued by the
board for the Texas B-On-time student loan program under Section
56.464(b).
Added by Acts 2003, 78th Leg., ch. 779, § 4, eff. June 20, 2003.
