Student loans: public service educational loan forgiveness program.

The federal Public Service Loan Forgiveness Program was created in 2007 by the federal College Cost Reduction and Access Act and requires certain student loans to be forgiven after 10 years of public service, as provided.

This bill would require the commission to establish a public service educational loan forgiveness program of up to $10,000 per applicant, as specified. The bill would require applicants for the program to have made continuous payments on their debt and be active employees of a state agency, local government agency, or nonprofit organization, as defined, who have served for a minimum of 10 years. The bill would require an applicant to provide proof of full-time employment and for the applicant's supervisor, manager, or a nonprofit organization board member to attest, under penalty of perjury, that the applicant is in good standing with the respective agency or nonprofit organization for which they serve. By expanding the crime of perjury, and to the extent that the bill would otherwise impose additional duties on local government officials, the bill would impose a state-mandated local program. The bill would create the Public Service Education Loan Forgiveness Fund and authorize the commission to accept donations for purposes of the program and deposit them in the fund. The bill would require the commission to monitor the program for fraud and to annually report to the Legislature on the program, as specified. The bill would make the operation of the program contingent upon an appropriation in the annual Budget Act or another statute.

The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

This bill would provide that with regard to certain mandates no reimbursement is required by this act for a specified reason.

With regard to any other mandates, this bill would provide that, if the Commission on State Mandates determines that the bill contains costs so mandated by the state, reimbursement for those costs shall be made pursuant to the statutory provisions noted above.