(a) The Tennessee student assistance corporation (TSAC) shall administer a minority teaching fellows program, not to exceed thirty-five (35) persons per class level per year, for talented Tennesseans who aspire to be teachers. Participation in the program at any time shall be limited to one hundred sixteen (116) fellows.

(1) Recipients must attend a higher education institution within the state, which institution must have an approved teacher education program as determined by the state board of education, or must enroll initially in a two-year college program that has transfer agreements with an approved teacher education program in this state.

(2) Recipients must pursue a baccalaureate degree program leading to licensure as a teacher.

(3) Each fellowship award shall be in the amount of five thousand dollars ($5,000) and shall be renewable up to three (3) times, contingent upon satisfactory academic performance.

(4)

(A) Recipients who become public school teachers in this state shall receive forgiveness of the fellowship balance based on one (1) year's teaching service for each year the fellowship was awarded.

(B) TSAC shall also forgive the loan if, within seven (7) years after graduation, the recipient teaches for three (3) consecutive years, unless the recipient takes an approved leave of absence, at a Tennessee public school in a local school administrative unit that, at the time the recipient accepts employment with the unit, is a high priority school system or is on warning status as defined by the commissioner or board of education. TSAC shall also forgive the loan if it finds that it is impossible for the recipient to teach for four (4) years, within seven (7) years after graduation, at a Tennessee public school because of the death or permanent disability of the recipient.

(b)

(1) TSAC, in conjunction with the state board of education and the Tennessee higher education commission, shall develop rules, regulations and criteria for the selection of minority Tennessee citizens and for the management of the program.

(2) All scholarship loans shall be evidenced by notes made payable to TSAC, which shall bear interest at the rate of nine percent (9%) per year beginning September 1 after completion of the program, or immediately after termination of the scholarship loan, whichever is earlier. The scholarship loan may be terminated by the recipient withdrawing from school or by the recipient not meeting the standards set by TSAC.