(a) To the extent provided for by the General Assembly in annual appropriations Acts, the authority is authorized under this subpart to make service cancelable education loans to residents of Georgia who are enrolled or accepted for enrollment in colleges of osteopathic medicine located within the United States, provided the college is accredited or provisionally accredited by the Bureau of Professional Education of the American Osteopathic Association and that graduates from the program of medical education in the college are eligible to apply for licensure by the Georgia Composite Medical Board.

(b) The authority is authorized to enter into agreements with such colleges as may be appropriate to accomplish the purposes of this subpart, including, without limitation, agreements whereby a college will hold open one or more admission places for qualified Georgia residents who may be selected to receive a cancelable loan under this subpart.

(c) The osteopathic medical loan program shall be administered by the authority in accordance with this subpart and reasonable rules, regulations, and procedures established by the authority. Without limiting the generality of the foregoing, the authority is authorized to establish applicant eligibility and priority requirements, require a personal interview with applicants, determine individual loan amounts, and determine the apparent ability, character, and qualifications of applicants and their fitness to become recipients of a loan, including consideration of their home area in Georgia and the likelihood, if determinable, that they will return and practice their profession in an area or at a site in Georgia that will likely enable them to repay their loans in services. The amount of loan made to an applicant shall not exceed the applicant's need for financial assistance as determined by the authority. The authority is authorized to give preference among qualified applicants to those who appear to be least able to pay costs associated with attendance at college.

(d) The principal amount of loans that may be made to a full-time student pursuant to provisions of this subpart shall not exceed $10,000.00 per academic year of study. A student may receive loan assistance pursuant to this subpart for not more than four academic years of study. Loan proceeds shall be disbursed at such times and in such manner as prescribed by the authority and may be disbursed, in full or in part, to the college in which the student borrower is enrolled to the credit of and for and on behalf of the student.

(e) Loans made pursuant to this subpart shall be conditioned upon the recipients' agreements in writing to repay the loans in services to the public through the practice of primary care medicine in an area of the state that is approved by the authority for purposes of this subpart as being a medically underserved area or in a hospital or facility operated by or under the jurisdiction of the Department of Community Health or the Department of Corrections. Loans shall bear interest at the rate of 12 percent per annum from each date of disbursement of loan proceeds by the authority. For each year of practice by a loan recipient of primary care medicine in an authority approved area, hospital, or facility, the loan recipient shall be given credit for repayment of loan amounts received by the recipient under this subpart for one academic year of study or its equivalent as a full-time student. To the extent that loans made under this subpart are repaid in approved services rendered, all interest due the authority on such loans shall likewise be canceled. Loans made under this subpart that are not repaid in approved services rendered shall, together with interest thereon, be repaid to the authority in cash at times prescribed by the authority. Each applicant shall, before receiving the proceeds of a loan, enter into a written agreement with the authority, execute a promissory note, or sign such other documents as may be required by the authority, the terms and conditions of which shall be in accordance with and designed to accomplish the purposes of this subpart.

(f) If a loan applicant under this subpart is eligible to receive a guaranteed education loan in accordance with the provisions of Part 2 of this article and the federal act, the authority is authorized in its discretion to lend all or a portion of the loan amount approved for the applicant under this subpart to the applicant as a guaranteed educational loan pursuant to Part 2 of this article and the federal act. In such cases, the provisions of Part 2 of this article and the federal act shall govern all terms and conditions of the loan; provided, however, that the right of the recipient to repay such loan through services rendered to the state as provided for in this subpart shall not be diminished.

(g) The making of service cancelable loans to osteopathic medical students under this subpart shall not be construed to contravene provisions of paragraph (1) of subsection (b) of Code Section 20-3-374.

(h) Funds made available to the authority for purposes of this subpart but not used for such purposes during any fiscal year and loans previously made by the authority as to which the borrower no longer has a right to repay through services rendered shall become a part of the general loan fund of the authority provided for in Code Section 20-3-373.