Section 1679-A. Health education assistance loan financing program

1. The
  purpose of the  health  education  assistance  loan  financing  program,
  hereafter  referred  to  as  the HEAL loan financing program, is to make
  available to students attending public and independent institutions  for
  higher  education  financial  assistance  beyond  the  grants  and loans
  available  from  state,  federal  and  private   sources,   other   than
  supplemental  higher education loans pursuant to section sixteen hundred
  seventy-nine of this chapter, where such students demonstrate  remaining
  financial  need.  Such program is created to encourage the participation
  of  HEAL  eligible  institutions  in  conjunction  with,  but   not   in
  substitution  for, the participation of financial or credit institutions
  in increasing the availability of HEAL loans to all  eligible  students.
  The  authority  and  institutions  for higher education participating in
  such program shall to the extent practicable ensure  that  borrowers  of
  such loans include individuals who are underrepresented or unrepresented
  in the health professions.
    2.  In  furtherance of its powers under this title with respect to the
  HEAL loan financing program, the authority is authorized:
    (a) to receive and accept from  any  source  loans,  contributions  or
  grants  for  or in aid of the HEAL loan financing program or any portion
  thereof and, when desirable, to use such funds, property or  labor  only
  for the purposes for which it was loaned, contributed or granted;
    (b)  to  make  HEAL  direct  loans  to  students  attending,  and HEAL
  education loans to participating  independent  institutions  for  higher
  education, and require that the proceeds of HEAL education loans be used
  for   making   HEAL  student  loans,  funding  reserves,  providing  for
  capitalized interest and paying other costs and fees involved in  making
  HEAL student loans or issuing bonds; and
    (c)   to   purchase  HEAL  student  loans  solely  from  participating
  independent institutions for higher education under terms and conditions
  which require that such loans were originated after the  effective  date
  of  this  section in contemplation of participation by such institutions
  for higher education in the HEAL loan financing program of the authority
  authorized by this section and in anticipation of the purchase  of  such
  loans  by  the  authority,  provided, however, that prior to the sale of
  bonds any portion of the  proceeds  of  which  shall  be  used  for  the
  purchase,  acquisition  or  taking  by  assignment  or otherwise of HEAL
  student  loans,  the  authority  shall  by  resolution  adopt   specific
  guidelines  setting  forth  the  terms  and  conditions  upon which such
  purchases, acquisitions and taking by assignment or otherwise  shall  be
  made. No such resolution shall be adopted until at least forty-five days
  after  the  delivery  of  a  copy  of  such  proposed  guidelines to the
  governor, the temporary president of the senate and the speaker  of  the
  assembly for comment.
    (d)  to  sell HEAL direct loans, HEAL education loans and HEAL student
  loans purchased, acquired or taken by assignment  or  otherwise  by  the
  authority  to  the  extent  necessary to assure the marketability of and
  adequacy of the security for the bonds of the authority.
    3. The authority shall adopt guidelines,  subject  to  review  by  the
  advisory  committee,  created  pursuant  to  subdivision  ten of section
  sixteen hundred  seventy-nine  of  this  chapter,  and  consistent  with
  federal  law  and  regulations  to  the  extent  applicable, which shall
  include but not be limited to: (a) eligibility criteria for making  HEAL
  education  loans  and  HEAL  direct  loans;  (b)  limitations  upon  the
  principal amounts and the terms of HEAL education loans and HEAL  direct
  loans;  (c)  qualifications  and  characteristics  of borrowers; and (d)
  procedures  for  allocating  HEAL  education  loans  among   independent
  institutions  and  for  allocating direct loans among students attending

  public institutions. Such guidelines shall also include such eligibility
  standards for borrowers as the authority shall determine  are  necessary
  or  desirable  in  order  to  effectuate  the  purposes  of this section
  including  the  following:  (a) each student shall have a certificate of
  enrollment or acceptance for  enrollment  at  a  specific  participating
  institution  for  higher  education; (b) each student shall satisfy such
  financial qualifications as the authority shall establish to  effectuate
  the  purposes  of  this  section; and (c) each student shall submit such
  information  as  may  be  required  by  the  authority  to  his  or  her
  institution  for  higher education. Such guidelines shall also establish
  specific criteria governing  the  making  of  HEAL  direct  loans,  HEAL
  education  loans  and  HEAL  student  loans, provisions for default, the
  establishment  of  default  reserve  funds,  the  purchase  of   default
  insurance,   the  provision  of  debt  service  reserve  funds  and  the
  furnishing by the  participating  independent  institutions  for  higher
  education  of  such  additional guarantees of, and security with respect
  to, HEAL education loans,  HEAL  student  loans  or  the  bonds  as  the
  authority  shall  determine,  all  of such criteria to be established to
  assure the marketability of the bonds and the adequacy of  the  security
  for the bonds to finance fully federally insured HEAL direct loans, HEAL
  education loans, and HEAL student loans.
    4.  The  authority shall contract with financial institutions, the New
  York state higher education  services  corporation  established  by  the
  provisions  of  section  six  hundred  fifty-two of the education law or
  other qualified loan origination and servicing organizations, which  may
  assist  in  pre-qualifying  borrowers  for  HEAL  student loans and HEAL
  direct loans and which may service and administer each HEAL student loan
  and HEAL direct loan and each institution's respective HEAL loan  series
  portfolio.
    5. The maximum amount of a HEAL student loan or HEAL direct loan shall
  not  exceed  the student's cost of attendance for the period of time for
  which the loan is made, minus the following amounts applicable  to  such
  period of time:
    (a)  the maximum net loan proceeds which the student receives, or will
  receive, under the guaranteed student loan program as defined under  (i)
  title  IV,  part  B,  of  the  "Higher Education Act of 1965", as now or
  hereafter amended, and (ii) the regulations  implementing  such  program
  promulgated  at  34  Code  of  Federal  Regulations, part 682, as now or
  hereafter amended;
    (b) the maximum net loan proceeds which the student's parents receive,
  or will receive, under the parent loan to undergraduate students program
  as defined under (i) title IV, part B, of the "Higher Education  Act  of
  1965",   as   now   or  hereafter  amended,  and  (ii)  the  regulations
  implementing such program promulgated at 34 Code of Federal Regulations,
  part 683, as now or hereafter amended;
    (c) the maximum net loan proceeds which the student receives, or  will
  receive,  under the auxiliary loan to assist students program as defined
  under (i) title IV, part B, of the "Higher Education Act  of  1965",  as
  now  or  hereafter  amended,  and (ii) the regulations implementing such
  program promulgated at 34 Code of Federal Regulations, part 683, as  now
  or hereafter amended;
    (d)   the   amount  of  scholarships,  grants  or  other  nonrepayable
  assistance received from government agencies,  educational  institutions
  or private institutions or organizations.
    6.  Notwithstanding  any other provisions contained in this title, but
  pursuant to guidelines,  the  authority  may  commingle  and  pledge  as
  security  for a series or issue of bonds, with the consent of all of the
  institutions for higher education which are participating in such series

  or issue, the HEAL student loan series portfolios and some or all future
  HEAL student loan series portfolios  of  such  institutions  for  higher
  education  provided  that  HEAL student loan series portfolios and other
  security  and  moneys  set  aside  in  any fund or funds pledged for any
  series of bonds or issue of bonds shall be held for the sole benefit  of
  such  series  or  issue separate and apart from HEAL student loan series
  portfolios and other security and moneys pledged for any other series or
  issue of bonds of the authority, and provided further that in  no  event
  shall  HEAL  student  loan  series portfolios be commingled with student
  loan series portfolios comprised of student loans made pursuant  to  the
  supplemental  higher  education  loan  financing  program  authorized by
  section sixteen hundred seventy-nine of this act or with any other  loan
  portfolio.  Bonds  may be issued in series under one or more resolutions
  in the discretion of the authority.
    7. The authority shall require  that  HEAL  education  loans  be  used
  solely  to  make  HEAL  student loans and that HEAL direct loans be used
  solely for the purpose of financing the cost  of  attendance  at  public
  institutions  for  higher  education.  The  authority shall require that
  independent institutions for higher education shall  require  that  each
  borrower  under  a  HEAL  student loan shall use the proceeds solely for
  such cost of attendance and that each such borrower shall so certify.
    8. Any student otherwise eligible for a HEAL student  loan  or  for  a
  HEAL direct loan shall not be disqualified by reason of his or her being
  under  the  age of eighteen years and, for the purposes of applying for,
  receiving and repaying such a loan, any such student shall be deemed  to
  have  full legal capacity to act; provided, however, that the signatures
  of one parent of an unemancipated applicant shall be  required  for  the
  purpose  of  receiving  such  a  loan unless the authority determines in
  accordance with guidelines established by the  board  of  the  authority
  that  unusual  family  circumstances  preclude  the availability of such
  signature.
    9. The authority may  charge  to  and  apportion  among  participating
  institutions  of  higher  education  and students its administrative and
  operating costs and expenses incurred in the exercise of the powers  and
  duties conferred by this section.
    10.  Bonds issued by the authority for the HEAL loan financing program
  shall be within the two hundred million dollar limitation set  forth  in
  paragraph (c) of subdivision two of section sixteen hundred seventy-nine
  of  this chapter and each such issuance shall be subject to the approval
  of the public authorities control board.
    11. The authority shall  report  annually  to  the  governor  and  the
  legislature  on  or  before  February  first  concerning  its  findings,
  conclusions and recommendations with respect to  the  operation  of  the
  programs provided for in this section.