(a) AS 09.38 does not apply to a permanent fund dividend taken under AS 14.43.145. Notwithstanding AS 09.35, the Alaska Commission on Postsecondary Education may take a permanent fund dividend under AS 14.43.145 by delivering a claim to the department certifying the following information:

(1) the name and social security number of the individual whose dividend is being claimed;

(2) the amount the individual owes on a loan awarded under AS 14.43; and

(3) a statement that the loan is in default under AS 14.43.145, or, if the individual has requested review of the status of the loan under AS 14.43.145(c), that a final determination has been made that the loan is in default.

(b) The Alaska Commission on Postsecondary Education shall notify the individual of a claim under (a) of this section. The notice shall be sent to the address provided in the individual's permanent fund dividend application and must provide the following information:

(1) the amount of the claim;

(2) notice that the amount of the permanent fund dividend up to the amount of the claim shall be paid to the Alaska Commission on Postsecondary Education to be credited against the individual's loan balance; and

(3) the individual's right to a hearing under (c) of this section.

(c) Within 30 days after the date of the notice under (b) of this section, the individual may request a hearing. AS 44.62.330 - 44.62.630 apply to a hearing under this section. At the hearing, the borrower has the burden to show that

(1) the commission has not sent a notice of default in compliance with AS 14.43.145(b);

(2) the notice of default has been rescinded after review under AS 14.43.145(c); or

(3) the amount owed by the borrower is less than the amount claimed from the permanent fund dividend.

(d) If the amount owed by the borrower is determined under (c) of this section to be some amount greater than $0, but less than the amount claimed, the commission may amend its claim to the amount determined to be owing.