Proposed Revisions to 505 - Guaranteed Student Loan Program
Section 20-26-1101 through 1107, Montana Codes Annotated.
will be organized under the Office of the Commissioner of Higher Education and
w ill be responsible
for the administration of the Guaranteed Student Loan program. Staff will be employed by the Commissioner
and funded through revenues generated by the program. The agency will retain
the following activities: regulation and compliance, lender promotion,
school and student liaison and other duties necessary for
the administration of the Guaranteed Student
2. The guarantee agency will request the Office
of Education to terminate all contractual agreements under the Federally
Insured Student Loan program as of the effective date of the Guaranteed Student
Loan program. 3. The Board of Regents will form a nonprofit
foundation for the purpose of establishing a secondary market. The board of directors of the nonprofit
foundation will be composed of eleven members. The membership method of selection and
appointment will be set forth in the Articles of Incorporation of the nonprofit
foundation. The nonprofit corporation
will request the Governor to designate that corporation as the single nonprofit
agency in the state defined in Section 435 (g)(1)(D) of Title IV, Part B of the
Higher Education Act of 1965 as amended.
4. The state
agency will contract
negotiated fees with a nonprofit servicer for the activities
in the Request for Proposal.
The activities will include but not be limited to loan processing, claim
processing and collections.
5. The nonprofit corporation may establish a
line of credit with a lending institution to provide start-up funds
necessary to implement the guarantee program.
The funds will be made available to the guarantee agency and will be
repaid in full when the Guaranteed Student Loan program becomes self
supporting. The amount of credit shall
not exceed $100,000.
Item 26-012-R0180, Montana Guaranteed Student Loan Program, January 7, 1980.