15-1783. Arizona teacher student loans; interest; obligations; repayment; authority of attorney general

A. Each applicant who is approved for a loan by the commission may be granted a loan for a period of up to five years.

B. The commission, on behalf of this state, shall enter into a written contract with the qualified student. The contract shall set forth the methods and terms of repayment by the loan recipient to this state and shall be on terms and conditions and in a form provided by the commission. The contract shall provide for the following:

1. The loan recipient shall begin the service commitment providing instruction in the area of mathematics, science or special education in a public school in this state or instruction in a public school in this state that is a low-income school, a rural school or a school that is located on an Indian reservation within one calendar year after completing a teaching degree or an alternative teacher certification program at a qualifying postsecondary institution. The service commitment shall be full-time as determined by the commission and requires one year of service for each year of loan support plus one additional year of service.

2. If the loan recipient engages in postgraduate studies without a lapse of more than one calendar year following the completion of the loan recipient's teaching degree or alternative teacher certification program at a qualifying postsecondary institution, the loan recipient shall begin the service commitment required under paragraph 1 of this subsection within one calendar year after completing postgraduate studies.

3. If the loan recipient is inducted into military service, or for any other cause beyond the loan recipient's control deemed sufficient by the commission is unable to begin the service commitment required under paragraph 1 of this subsection within one calendar year after completing a teaching degree, an alternative teacher certification program or any graduate studies, the loan recipient shall begin the service commitment required under paragraph 1 of this subsection within one calendar year after completing the required military service or the termination of any other cause.

4. If the loan recipient fulfills the service commitment required under paragraph 1 of this subsection in a public school in this state or while completing military service resulting from induction, the loan recipient's indebtedness to this state may be discharged in one of the following ways:

(a) One year of full-time service required under paragraph 1 of this subsection for each year of loan support plus one additional year of service.

(b) Repayment to this state of the total loan amount for each year of support with interest at the rate prescribed in subsection C of this section.

5. If the loan recipient fails to complete the required teaching degree or alternative teacher certification program, if the teaching degree or alternative teacher certification program is interrupted by one academic year or more for a cause or causes not resulting from induction into military service or any other cause beyond the loan recipient's control deemed sufficient by the commission or if the loan recipient fails to fully discharge the service commitment required under paragraph 1 of this subsection, except for delays resulting from an excusable cause as prescribed in this section, the amount of the loan not repaid or fully discharged shall be due and payable with interest at the rate prescribed in subsection C of this section. The commission may extend the time of payment over a period not exceeding fifteen years and shall not require payment of interest during the existence of any excusable cause as prescribed in this section.

6. If the loan recipient does not begin the service commitment required under paragraph 1 of this subsection within the time prescribed in this section but paid an agreed part of the loan, the commission may allow the loan recipient to discharge the balance of the obligation by subsequent teaching in this state.

7. If the loan recipient dies during the period of the loan recipient's education or practice as a teacher, the loan recipient's obligation to this state under this article ceases.

8. The loan recipient may choose at any time to provide a different category of service commitment prescribed in paragraph 1 of this subsection without violating the contract, unless the contract requires the loan recipient to provide instruction in the area of mathematics or science.

9. If the loan recipient begins the service commitment required under paragraph 1 of this subsection in a low-income school or a rural school in this state and the commission subsequently determines that the school no longer qualifies as low-income or rural, the loan recipient may discharge the balance of the obligation by completing the service commitment in the public school where the loan recipient began the service commitment.

C. The loan recipient shall repay the full amount borrowed at an interest rate of at least seven percent.

D. On receipt of supporting documentation, the commission for good cause shown may defer the loan recipient's service commitment or repayment obligation or may enter into repayment arrangements with the loan recipient or allow service that is equivalent to full-time service if the commission determines that this action is justified after a review of the individual's circumstances. At the discretion of the commission, the commission may allow service by teaching in another area of recognized need in this state that is not specified in the qualified student's contract, but only following prior written approval by the commission.

E. The attorney general may commence whatever actions are necessary to enforce the contract and achieve repayment of loans provided by the commission pursuant to this article.