SF1700

This bill, Senate File No. 1700, proposes the creation of the Higher Education Loan Program (HELP) in Minnesota, aimed at providing low-interest student loans to eligible students attending Minnesota postsecondary institutions.

Key Provisions:

1. Loan Program Establishment:

   • HELP is created to offer low-interest loans to eligible students.

2. Loan Terms:

   • Loans will have a fixed interest rate of up to 3% (unless another rate is set by law).
   • Loans are awarded based on the availability of funds.
   • A student can receive a maximum of $5,000 per year, with a lifetime borrowing limit of $20,000.
   • The commissioner may contract with a third-party loan servicer.

3. HELP Loan Account:

   • A special revenue account is established to manage loan funds.
   • Appropriations, along with loan repayment funds (principal and interest), are deposited into the account.
   • Funds in the account are continuously available without cancellation.

4. Eligibility:

   • The student must be a Minnesota resident.
   • The student must attend an eligible public or nonprofit postsecondary institution in Minnesota.
   • The student's household income must be at or below 300% of the federal poverty guidelines.

5. Rulemaking:

   • The commissioner is authorized to adopt rules for program implementation.

6. Appropriations:

   • $17.5 million in fiscal years 2026 and 2027 is allocated from the general fund to finance HELP loans.
   • Up to 3% of the appropriation may be used for administrative costs.
   • A one-time appropriation in fiscal year 2026 is designated for securing a loan servicer.

This bill aims to increase access to affordable student loans for lower-income Minnesota students pursuing higher education at qualifying institutions.