La. Admin. Code tit. 28 § IV-1609

Current through Register Vol. 50, No. 11, November 20, 2024

Section IV-1609 - Discharge of Obligation

A. The obligations of the recipient may be discharged by cancellation, teaching for the required period of obligation, or by monetary repayment.

B. Cancellation. The board may discharge the requirement to maintain full-time enrollment, or 2/3 time for doctoral degree students, the requirement to complete the degree program in which the recipient is enrolled, or the requirement to teach full-time as a registered nurse or allied health education faculty member under the following circumstances:

1. the recipient has a permanent mental or physical disability, or other circumstance for which the board may deem discharge is appropriate; and

2. the recipient provides such documentation as the board requires in order to evaluate whether a discharge should be granted; or

3. the participating institution at which the recipient is employed requests that the board discharge the teaching requirement and provides such documentation that the board requires to make a determination that the obligation should be discharged.

C. Fulfillment of Teaching Requirement. The obligation may be discharged under the following conditions:

1. the recipient secures full-time employment as a nurse or allied health program faculty member at the institution which nominated him for the loan program or at another participating institution with the assistance and approval of the institution which nominated him for the loan program; and

2. the recipient begins teaching full-time as a nurse or allied health program faculty member no later than the semester following the semester the student obtains his masters or doctoral degree; or

3. if the student is unable to secure employment as a fulltime faculty member at the institution which nominated him for the loan program or at another participating institution with the assistance and approval of the institution which nominated him for the loan program, the recipient may fulfill the teaching obligation by working in a public health facility, state office, or other alternative service as the board may deem appropriate. The student must seek and obtain board approval prior to undertaking such an alternative service position;

4. each year of full time teaching or other alternative service as approved by the board will discharge $10,000 of the obligation.

D. Monetary Repayment. A recipient may be terminated from participation in the program either with or without default.

1. Termination without Default

a. Termination without default occurs when:

i. the recipient's enrollment in the degree program for which he received program funds is discontinued;

ii. the recipient fails to remain enrolled on a fulltime basis, or 2/3 time for doctoral students; or

iii. the recipient fails to maintain good academic standing.

b. In the event of termination without default, the recipient must repay the total of program funds received plus interest to LOSFA within 90 days of the date an event listed in §1609. D.1.a i-iii occurs.

c. Interest will accrue at the prime interest rate at the time the condition in §1609. D.1.a i-iii occurs plus 3 percent. Interest will accrue from the date of each disbursement.

2. Termination with Default

a. Termination with default occurs:

i. if, upon completion of the degree, the recipient fails to obtain a full-time faculty position in a nurse or allied health education program or fails to obtain approval for an alternative service position without just cause; or

ii. the recipient is terminated from his employment for cause or voluntarily leaves his employment prior to fulfillment of the teaching obligation.

b. In the event of termination with default, the principal due at the time of default will be calculated in accordance with the following formula:

i. [(a/b) x (b-c)]3 = d.

ii. for purposes of the formula above, "a" is equal to the total of the loans disbursed; "b" is equal to the months of service obligation required; "c" is equal to the number of months of the teaching obligation that were fulfilled; and "d" is equal to the total principal balance at the time repayment begins.

c. Interest will accrue on the principal due at the prime rate at the time of default plus 3 percent.

d. Interest will begin to accrue 60 days following the board's determination that the recipient is in default and shall accrue for the duration of the repayment period.

e. The recipient must make payment in full of the total amount due or begin making monthly payments no later than 60 days after the date of default and shall pay at least 25 percent of the total amount, including interest, due each calendar year.

La. Admin. Code tit. 28, § IV-1609

Promulgated by the Student Financial Assistance Commission, Office of Student Financial Assistance, LR 35:225 (February 2009), Amended by the Board of Regents, Office of Student Financial Assistance, LR 44548 (3/1/2018).

AUTHORITY NOTE: Promulgated in accordance with R.S. 17:3021-3031 and R.S. 17:3129.7.