§ 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.