11 KAR | Title 11 KAR — Kentucky Higher Education Assistance Authority

Chapter 3 Kentucky Loan Program

11 KAR 3:001 Definitions {#sec-11-kar-3-001 omnilex-key=us-ky-regs-official--title-11--11 KAR 3:001}

Section 1. The following definitions apply to all authority insured student loan programs:

(1) "Academic year" means:

(a) A period of at least thirty (30) weeks of instructional time in which a full-time student is expected to complete at least twenty-four (24) semester hours or thirty-six (36) quarter hours at an institution which measures academic progress in credit hours but does not use a semester, trimester or quarter system; or

(b) At least 900 clock hours at a participating institution which measures academic progress in clock hours.

(2) "Applicable interest rate" means the maximum annual interest rate that a lender may charge on an authority insured loan.

(3) The definition of "authority" is governed by KRS 164.740(1).

(4) "Borrower" means a student or parent to whom a federal Stafford loan, a federal SLS loan, a federal PLUS loan, or a federal Consolidation loan is made.

(5) "Clock hour" means the equivalent of:

(a) A fifty (50) to sixty (60) minute class, lecture or recitation;

(b) A fifty (50) to sixty (60) minute faculty supervised laboratory, shop training, or internship; or

(6) "College work study program (CWS)" means the part-time employment program for students authorized by Part C of the federal Act (42 U.S.C. 2751-2756b).

(7) "Co-maker" means one (1) of two (2) individuals who are joint borrowers on a federal PLUS Program loan and who are equally liable for repayment of the loan.

(8) "Default" means the failure of a borrower to make an installment payment when due, or to meet other terms of the promissory note under circumstances where the authority finds it reasonable to conclude that the borrower no longer intends to honor the obligation to repay, provided that this failure persists for:

(a) 180 days for a loan repayable in monthly installments; or

(b) 240 days for a loan repayable less frequent installments.

(9) "Defense loan" means a loan made before July 1, 1972, under Title II of the National Defense Education Act (20 U.S.C. 421-429).

(10) "Dependent student" means any student who does not qualify as an independent student (see independent student).

(11) "Direct loan" means a loan made under Part E of the federal Act (20 U.S.C. 1087aa, et seq.) after June 30, 1972, which does not satisfy the definition of "Perkins loan."

(12) "Disbursement" means the transfer of loan proceeds by a participating lender to a borrower, a school, or an escrow agent by issuance of a check or by electronic funds transfer.

(13) The definition of "disposable pay" is governed by Section 488A(d) of the federal Act (20 U.S.C. 1095-1).

(14) The definition of "eligible student" is governed by KRS 164.740(6).

(15) The definition of "endorser" is governed by KRS 164.740(7).

(16) "Enrolled" means the status of a student who:

(a) Has completed the registration requirements (except for the payment of tuition and fees) at the participating institution he is attending; or

(b) Has been admitted into a correspondence study program and has submitted one (1) lesson, completed by him or her after acceptance for enrollment and without the help of a representative of the school.

(17) "Escrow agent" means the authority acting in a capacity in which it agrees to receive the proceeds of an insured student loan as an agent of a participating lender for the purpose of transmitting those proceeds to the borrowers.

(18)

(a) "Estimated cost of attendance" means, for loans disbursed prior to July 1, 1993, the tuition and fees applicable to a student, plus the participating institution's estimate of other expenses reasonably related to attendance at that school, for the period of enrollment for which the loan is sought. These expenses shall not include the purchase of a motor vehicle. The expenses may include, but are not limited to, reasonable transportation and commuting costs, costs for room, board, books, and supplies, the insurance premium for the loan, and if applicable, the origination fee for the loan.

(b) "Estimated cost of attendance" means, for loans disbursed on or after July 1, 1993.

Tuition and fees normally assessed a student carrying the same academic workload as determined by the participating institution, and including costs for rental or purchase of any equipment, materials, or supplies required of all students in the same course of study;
An allowance for books, supplies, transportation, and miscellaneous personal expenses for a student attending the participating institution on at least a half-time basis, as determined by the participating institution at which such student is enrolled;
An allowance (as determined by the participating institution) for room and board costs incurred by the student, which shall be not less than $1,500 for a student without dependents residing at home with parents, the amount normally assessed most of the institution's residents for room and board for students without dependents residing in institutionally owned or operated housing, or an allowance of not less than $2,500 for all other students based on the expenses reasonably incurred by the students for room and board;
For a student enrolled in an academic program of study abroad approved for credit by the student's home institution, reasonable costs associated with the study (as determined by the participating institution at which such student is enrolled);
For a student with one (1) or more dependents, an allowance based on the estimated actual expenses incurred for such dependent care, based on the number and age of such dependents, except that the allowance shall not exceed the reasonable cost in the community in which the student resides for the kind of care provided, and the period for which dependent care is required includes, but is not limited to, class time, study time, field work, internships, and commuting time;
For a student with a disability, an allowance (as determined by the participating institution) for those expenses related to the student's disability, including special services, personal assistance, transportation, equipment, and supplies that are reasonably incurred and not provided for by other assisting agencies;
For a student receiving all or part of the student's instruction by means of telecommunications technology, no distinction shall be made with respect to the mode of instruction in determining costs, except that the financial aid officer at a participating institution shall reduce the amount of an authority insured student loan for which a student is otherwise eligible, if the financial aid officer determines that the student's cost of attendance is substantially reduced due to instruction by means of the use of telecommunication, but this paragraph shall not be construed to permit including the cost of rental or purchase of equipment; and
For a student placed in a work experience under a cooperative education program, an allowance for reasonable costs associated with such employment (as determined by the participating institution at which such student is enrolled).

(19) "Estimated financial assistance" means the estimated amount of assistance that a student has been or will be awarded during the period of enrollment for which the loan is sought from federal, state, institutional or other scholarship, grant, work, or loan programs, including but not limited to:

(a) Any Social Security benefits paid to, or on account of, the student that would not be paid if he was not a student;

(b) Any veterans' education benefits paid because of enrollment in a postsecondary education institution, including veterans' education benefits received under U.S.C. Title 10 chapters 2, 106, and 107; Title 37 chapter 2; Title 38 chapters 30, 31, 32, and 35; 20 U.S.C. 1087vv(c); and

(d) The estimated amount of other federal student financial aid, including but not limited to Pell Grants and assistance under the SEOG, federal work-study, and federal Perkins Loan programs, which the student would be expected to receive if the student applied, whether or not the student has applied for that aid; and

(e) Loan proceeds withheld by the lender and applied towards an origination fee or insurance premium, if these costs are included in computing the borrower's estimated cost of attendance.

(20) The definition of "federal act" is governed by KRS 164.740(8).

(21) "Federal Consolidation Loan Program" means the loan program authorized by section 428C of the federal Act (20 U.S.C. 1078-3).

(22) "Federal PLUS Program" means the loan program authorized by section 428B of the federal Act (20 U.S.C. 1078-2).

(23) "Federal Supplemental Loans for Students (SLS) Program" means the loan program authorized by section 428A of the federal Act (20 U.S.C. 1078-1) and formerly called the ALAS Program.

(24) "Foreign school" means a school not located in a state.

(25) "Full-time student" means:

(a) A student enrolled in a participating institution (other than a student enrolled in a program of study by correspondence) who is carrying a full-time academic workload as determined by the institution under standards applicable to all students enrolled in that student's particular program. The student's workload may include any combination of courses, work, research or social studies, whether or not for credit, that the school considers sufficient to classify the student as a full-time student; or

(b) A student enrolled in a vocational program of study (other than a student enrolled in a program of study by correspondence) who is carrying a workload of not less than twenty-four (24) clock-hours per week or twelve (12) semester or quarter hours of instruction, or its equivalent.

(26) "Grace period" means the period that begins on the day on which a federal Stafford loan borrower ceases to be enrolled as at least a half-time student at a participating institution and ends on the day that the repayment period begins. See also "postdeferment grace period".

(27) "Graduate or professional student" means a student who:

(a) Is enrolled in a program or course above the baccalaureate level at an institution of higher education or is enrolled in a program leading to a first professional degree;

(b) Has completed the equivalent of at least three (3) years of full-time study at an institution of higher education, either prior to entrance into the program or as part of the program itself; and

(c) Is not receiving aid under Title IV of the federal Act (20 U.S.C. 1070 through 1099c-1) as an undergraduate student for the same period of enrollment.

(28) "Guarantee agency" means a state or private nonprofit organization that has an agreement with the secretary to administer a loan guarantee program under the federal Act.

(29) "Guaranteed Student Loan (GSL) Program" means the student loan program, which has been redesignated as the Robert T. Stafford Federal Student Loan program, authorized by Part B of Title IV of the federal Act (20 U.S.C. 1071(c)).

(30) "Half-time student" means a student who is enrolled in a participating institution, is carrying an academic workload that amounts to at least one-half (1/2) the workload of a full-time student, as determined by the school, and is not a full-time student. A student enrolled solely in an eligible program of study by correspondence is considered a half-time student.

(31) "Holder" means a participating lender in possession of authority insured student loan.

(32) "Income Contingent Loan (ICL) Program" means the student loan program authorized by Part D of the federal Act (20 U.S.C. 1087a, et seq.).

(33) "Independent student" means any individual who:

(a) Is twenty-four (24) years of age or older by December 31 of the award year;

(b) Is an orphan or ward of the court;

(d)

Is a graduate or professional student; and
For award years beginning prior to July 1, 1993, declares that he will not be claimed as a dependent for income tax purposes by his parents for the first calendar year of the award year;

(e)

Is a married individual; and
For award years beginning prior to July 1, 1993, declares that he will not be claimed as a dependent for income tax purposes by his parents for the first calendar year of the award year;

(f) Has legal dependents other than a spouse;

(g) For award years beginning prior to July 1, 1993, is a single undergraduate student with no dependents who was not claimed as a dependent for income tax purposes by his parents for the two (2) calendar years preceding the award year and demonstrates total self-sufficiency for those two (2) years by total annual resources of at least $4,000; or

(h) Is a student for whom a financial aid administrator makes a documented determination of independence by reason of other unusual circumstances.

(34) The definition of "insured student loan" is governed by KRS 164.740(11), except that, for loans on which the first disbursement is made on or after October 1, 1993, the term shall include loans reinsured by the secretary to the extent of not less than seventy-eight (78) percent.

(35) "Legal guardian" means an individual appointed by a court to be a "guardian" of a person and specifically required by the court to use his financial resources for the support of that person.

(36) The definition of "loan" is governed by KRS 164.740(12).

(37) The definition of "loan guarantee" is governed by KRS 164.740 (13), except that, for loans on which the first disbursement is made on or after October 1, 1993, the term shall include loans reinsured by the secretary to the extent of not less than seventy-eight (78) percent.

(38) "National Defense Student Loan program" means the student loan program authorized by Title II of the National Defense Education Act of 1958 (20 U.S.C. 421-429).

(39) "National Direct Student Loan (NDSL) Program" means the student loan program authorized by Part E of the federal Act (20 U.S.C. 1087aa-1087ii) between July 1, 1972, and October 16, 1986.

(40) "National of the United States" means:

(a) A citizen of the United States; or

(b) As defined in the Immigration and Nationality Act, 8 U.S.C. 1101(a)(22), a person who, though not a citizen of the United States, owes permanent allegiance to the United States.

(41) "One (1) year training program" means a program which is at least:

(a) Twenty-four (24) semester or trimester hours or units, or thirty-six (36) quarter hours or units at an institution using credit hours or units to measure academic progress;

(b) 900 clock hours of supervised training at an institution using clock hours to measure academic progress; or

(42) "Origination relationship" means a special relationship between a participating institution and a lender, in which the lender delegates to the institution, or to an entity or individual affiliated with the institution, substantial functions or responsibilities normally performed by lenders before making loans.

(43) "Parent" means a student's mother, father, or legal guardian. A parent by adoption is considered to be a student's mother or father.

(44) The definition of "participating institution" is governed by KRS 164.740(14).

(45) The definition of "participating lender" is governed by KRS 164.740 (15).

(46) "Pell Grant program" means the grant program authorized by subpart 1 of Part A of the federal Act (20 U.S.C. 1070a).

(47) "Perkins loan" means a loan made under Part E of the federal Act (20 U.S.C. 1087aa, et seq.) to cover the cost of attendance for a period of enrollment beginning on or after July 1, 1987, to an individual who on July 1, 1987, had no outstanding balance of principal or interest owing on any loan previously made under the National Direct Student Loan program.

(48) "Perkins Loan program" means the student loan program authorized by Part E of the federal Act (20 U.S.C. 1087aa-1087ii) after October 16, 1986.

(49) "Postdeferment grace period" means for an insured student loan made prior to October 1, 1981, a period of six (6) consecutive months being on the day following the last day of an authorized deferment period.

(50) "Recognized equivalent of a high school diploma" means:

(a) A general education development (GED) certificate; or

(b) A state certificate received by a student after the student has passed a state authorized examination which the state recognizes as the equivalent of a high school diploma.

(51) "Regular student" means a person who is enrolled or accepted for enrollment at a participating institution for the purpose of obtaining a degree, certificate, or other recognized educational credential offered by that institution.

(52) "Robert T. Stafford Federal Student Loan program" means the student loan program authorized by Part B of the federal Act, consisting of subsidized and unsubsidized loans authorized by sections 428 (20 U.S.C. 1078) and 428H (20 U.S.C. 1078-8) of the federal Act, and includes loans previously made under the guaranteed student loan program.

(53) The definition of "secretary" is governed by KRS 164.740(20).

(54) "Six (6) month training program" means:

(a) A program which is at least:

Sixteen (16) semester or trimester hours or units, or twenty-four (24) quarter hours or units, at an institution using credit hours or units to measure academic progress;
600 clock hours of supervised training at an institution using clock hours to measure academic progress; or
600 clock hours in a correspondence program;

(b) A program which the secretary determines is at least a six (6) month training program on the basis of:

A certification by the nationally recognized accrediting association that accredits the institution that the program offered by the institution is equal in course content and student workload to the comparable clock or credit hour program described in paragraphs (a)1 through 3 of this subsection; and
The secretary's ratification of that accrediting agency's determination.

(55) "State" means each state of the Union, the Commonwealth of Puerto Rico, the District of Columbia, American Samoa, Guam, the Trust Territory of the Pacific Islands, the Virgin Islands, and the Northern Mariana Islands.

(56) "State Student Incentive Grant (SSIG) program" means the grant program authorized by subpart 4 of Part A of the federal Act (20 U.S.C. 1070c, et seq.).

(57) "Subsidized Federal Stafford Student loan" means a loan qualifying for payment of an interest subsidy on behalf of the borrower under section 428 of the federal Act (20 U.S.C. 1078).

(58) "Supplemental Educational Opportunity Grant (SEOG) program" means the grant program authorized by subpart 3 of Part A of the federal Act (20 U.S.C. 1070b, et seq.).

(59) "Totally and permanently disabled" means the inability of a borrower to work and earn money because of an impairment that is expected to continue indefinitely or result in death.

(60) "Undergraduate student" means a student who is enrolled at a school in a course or program of study, at or below the baccalaureate level, that usually does not exceed four (4) academic years, or is up to five (5) academic years in length and shall be designed to lead to a first degree. A student enrolled in any other length program is considered an undergraduate student for only the first four (4) academic years.

(61) "Unsubsidized federal Stafford student loan" means a student loan authorized under section 428H of the federal Act (20 U.S.C. 1078-8).

(62) "U.S. citizen or national" means:

(a) A citizen of the United States; or

(b) A person defined in the Immigration and Nationality Act (8 U.S.C. 1101, (a)(22)) who, though not a citizen of the United States, owes permanent allegiance to the United States.

History

RELATES TO: KRS 164.740, 164.744(1), 164.748(1), (3) (14), (15), 164.753(2), 164.766, 8 U.S.C. 1101(a)(22), 10 U.S.C. Chapters 2, 106, 107, 20 U.S.C. 421-429, 1070a, 1070b, 1070c, 1078, 1078-1, 1078-2, 1078-3, 1078(c)(1), as amended by Pub.L. 103-66 sec. 4108(a), 1087a, 1087aa-1087ii, 1095-1, 37 U.S.C. Chapter 2, 38 U.S.C. Chapters 30, 31, 32, 35, 20 U.S.C. 1087vv(c)
STATUTORY AUTHORITY: KRS 13A.222(4)(e), 164.746(6), 164.748(4), (15), 34 C.F.R. 682.401(b)(10)(ii)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.744(1) empowers the authority to insure loans to students, provided that the loans meet the criteria of the federal act. This administrative regulation sets forth general definitions applicable to one (1) or more administrative regulations in this chapter. KRS 164.740(12) and (14) define the terms "insured student loan" and "loan guarantee" to pertain to loans reinsured by the secretary to the extent of not less than eighty (80) percent. Pub.L. 103-66 sec. 4108(a) amended 20 U.S.C. 1078(c)(1) by reducing the minimum rate of reinsurance from eighty (80) percent to seventy-eight (78) percent. KRS 164.748(15) authorizes the authority board to adopt "rules, administrative regulations and policies consistent with the federal act" to overcome a conflict "between KRS 164.740 to 164.764 and the federal act, which conflict would result in a loss by the authority of any federal funds." This amendment is necessary to conform the definitions of "insured student loan" and "loan guarantee" to changes in the federal act enacted in Pub.L. 103-66 sec. 4108(a).
History: 011 KAR 003:001. 19 Ky.R. 1668; 2017; eff. 3-4-1993; 20 Ky.R. 1022; 1777; eff. 1-10-1994; TAm eff. 4-27-2016; Crt eff. 9-28-2018; Crt eff. 7-28-2025.

11 KAR 3:005 Lender participation {#sec-11-kar-3-005 omnilex-key=us-ky-regs-official--title-11--11 KAR 3:005}

Section 1. In order to be considered for participation in the authority's insured student loan program, a lender shall submit to the authority, if requested, information sufficient to enable the authority to determine the eligibility of the lender and whether it meets the following criteria. In determining whether to enter into a contract of insurance with an applicant, and, if so, what the terms of the contract will be, the authority considers:

(1) Whether the applicant is an organization described in, and not disqualified pursuant to, 435(d) of the federal act (20 U.S.C. 1085(d));

(2) Whether the applicant is capable of complying with federal regulations and 11 KAR Chapter 3 as they apply to lenders participating in the authority's insured student loan program;

(3) Whether the applicant is capable of implementing adequate procedures for making, servicing, and collecting insured student loans;

(4) Whether the applicant has had prior experience with a similar federal, state, or private nonprofit student loan program, and the amount and percentage of loans that are currently delinquent or in default under that program;

(5) The financial resources of the applicant; and

(6) In the case of a school that is seeking approval as a lender, whether it is accredited.

Section 2.

(1) The authority may enter into a contract of insurance with an eligible lender approved by the secretary, if the lender is:

(a) Capable of complying with federal regulations and 11 KAR Chapter 3 as they apply to lenders participating in the authority's insured student loan program;

(b) Capable of implementing adequate procedures for making, servicing, and collecting insured student loans; and

(2) The authority shall issue loan guarantees for lenders under contracts described in Section 3 of this administrative regulation without regard to the residency of the borrower or the state in which the educational institution is located.

(3) In the event that loan guarantees are issued pursuant to subsection (2) of this section, and none of the principal parties (lender, educational institution or borrower) are located in the Commonwealth, then, for purposes of the federal act, the authority shall deem the state in which the participating lender is located to be the area served by the authority.

Section 3. The Contract of Insurance.

(1) In order to participate, an eligible lender shall execute a contract of insurance with the authority. No loan guarantee shall be issued by the authority unless it is covered by such an agreement.

(2) In general, under a contract of insurance, the participating lender agrees to comply with all laws, administrative regulations, and other requirements applicable to its participation as a lender. In return the authority agrees to insure each eligible loan held by the lender against the borrower's default, death, total and permanent disability, or bankruptcy.

(3) The authority may include in a contract of insurance a limit on the duration of the contract and the number or amount of loans the participating lender may make or hold.

(4) Except as otherwise approved by the authority, a contract of insurance with a school lender limits the loans made by that school lender that will be covered by the loan guarantee to those loans made to students, or to parents borrowing on behalf of students, who are:

(a) In attendance at that school;

(b) In attendance at other schools under the same ownership as that school; or

(c) Employees or dependents of employees, or whose parents are employees, of that school lender or other schools under the same ownership, under circumstances the authority considers appropriate for loan guarantees.

(5) A limit imposed under subsection (4) of this section on a school lender that makes loans to students, or to parents of students, in attendance at other schools under the same ownership, or to employees, or to dependents or parents of employees of those other schools may be imposed on a school-by-school basis.

History

RELATES TO: KRS 164.740(6), (16), 164.748(5), (13), 20 U.S.C. 1078(B)(1)(U), 1085(d), 34 C.F.R. 682.401(b)(17)(i)(A), (B)
STATUTORY AUTHORITY: KRS 164.746(6), 164.748(4), 20 U.S.C. 1078(B)(1)(U), 34 C.F.R. 401(b)(17)(i)(A), (B)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.748(1) authorizes the board to "provide loan guarantees, upon such terms and conditions as the board may prescribe within the limitations provided by KRS 164.740 to 164.785, and the federal act in respect of loans to eligible students." KRS 164.748(5) authorizes the board to "enter into contracts with eligible lenders approved by the state to lend moneys, upon such terms and conditions as may be agreed upon between the authority and the eligible lender, to provide for the administration of student financial assistance programs, including, but not by way of limitation, the authority's program of insured student loans." The authority is the designated guarantor for the state of Kentucky under the Robert T. Stafford Federal Student Loan Program, the Federal Plus Program, the Federal Consolidation Loan Program, and the Federal Supplemental Loans to Students Program pursuant to the federal act of 1965, as amended (20 U.S.C. 1071 et seq.) and agreements with the secretary. Section 428(b)(1)(U) of the federal act requires the authority to provide for the eligibility of all lenders described in 435(d)(1) of the federal act under reasonable criteria. 34 C.F.R. 682.401(b)(17)(A) requires the authority to establish and disseminate the criteria for lender eligibility. This administrative regulation sets forth the criteria for approval of lender participation and execution of a contract of insurance with eligible lenders. This amendment is necessary to eliminate a geographic limitation on organizations that may participate as lenders, and eliminate definitions now contained in 11 KAR 3:001.
History: 011 KAR 003:005. 19 Ky.R. 1012; eff. 12-9-1992; 21 Ky.R. 47; 908; eff. 9-12-1994; Crt eff. 9-28-2018; Crt eff. 7-28-2025.

11 KAR 3:045 Permissible charges by lenders to borrowers {#sec-11-kar-3-045 omnilex-key=us-ky-regs-official--title-11--11 KAR 3:045}

Section 1. Interest Rates on Subsidized Federal Stafford Loans.

(1) The annual interest rate on the unpaid principal balance (including any capitalized interest added to principal) of a subsidized federal Stafford loan for a borrower who, on the date of signing the promissory note or other written evidence of that loan, does not owe an outstanding balance on a previous federal Stafford loan shall be:

(a) Seven (7) percent for a loan covering a period of instruction beginning before January 1, 1981;

(b) Nine (9) percent for a loan covering a period of instruction beginning on or after January 1, 1981, but before September 13, 1983;

(d) For any loan to cover the cost of instruction for any period of enrollment beginning on or after July 1, 1988:

Eight (8) percent during the period beginning on the date of the disbursement of the loan and ending four (4) years after the commencement of repayment; and
Ten (10) percent during the remainder of the repayment period;

(e) For any loan for which the first disbursement is made on or after October 1, 1992, during any twelve (12) month period beginning on July 1 and ending on June 30, be determined by the secretary on the preceding June 1 and be equal to the bond equivalent rate of ninety-one (91) day treasury bills, auctioned at the final auction held prior to such June 1, plus three and one-tenth (3.1) percent, except that the rate shall not exceed nine (9) percent. The secretary shall determine the rate of interest under this paragraph after consultation with the U.S. Secretary of the Treasury and shall publish such rate in the Federal Register as soon as practicable after the date of determination;

(f) Eight (8) percent for any loan made, on or after October 1, 1992, to a borrower, who on the date of entering into the note or other written evidence of the loan, has an outstanding balance of principal or interest on any federal SLS loan, federal PLUS loan, or federal consolidation loan.

(2) The interest rate on a subsidized federal Stafford loan for a borrower who, on the date of signing the promissory note or other written evidence of that loan, has an outstanding balance on a previous federal Stafford loan, shall be the applicable interest rate on the previous loan.

(3) Treatment of excess interest payments on accounts resulting from decline in treasury bill rates;

(a) If, with respect to a loan for which the applicable interest rate is ten (10) percent under subsection (1)(d) of this section at the close of any calendar quarter, the sum of the average of the bond equivalent rates of ninety-one (91) day treasury bills auctioned for that quarter and 3.25 percent is less than ten (10) percent, then an adjustment shall be made to a borrower's account by calculating excess interest in the amount computed under paragraph (b) of this subsection, and crediting the excess interest to the reduction of principal to the extent provided for under paragraph (c) of this subsection;

(b) The amount of any adjustment of interest on a loan to be made under this subsection for any quarter shall be equal to ten (10) percent minus:

The sum of the average of the bond equivalent rates of ninety-one (91) day treasury bills auctioned for the calendar quarter, plus 3.25 percent; multiplied by
The outstanding principal balance of the loan (not including unearned interest added to principal) at the end of the calendar quarter; divided by
Four (4).

(c) Annual adjustment of interest and borrower eligibility for credit. Any adjustment amount computed pursuant to paragraph (b) of this subsection for any quarter shall be credited, by the holder of the loan on the last day of the calendar year in which such quarter falls, to the loan account of the borrower so as to reduce the principal balance of such account. No credit shall be made to the loan account of a borrower who on the last day of the calendar year is delinquent for more than thirty (30) days in making a required payment on the loan. Any credit which is to be made to a borrower's account pursuant to this subsection shall be made effective commencing no later than thirty (30) days following the last day of the calendar year in which the quarter falls for which the credit is being made. Nothing in this subsection shall be construed to require refunding any repayment of a loan. At the option of the lender, the amount of such adjustment may be distributed to the borrower either by reduction in the amount of the periodic payment on the loan, by reducing the number of payments that shall be made with respect to the loan, or by reducing the amount of the final payment of the loan.

(4)

(a) If, with respect to a loan (other than a loan for which the interest rate is determined in accordance with subsection (1)(e) of this section) made on or after July 23, 1992 to a borrower, who on the date of entering into the note or other written evidence of the loan, has an outstanding balance of principal or interest on any other authority insured loan, the sum of the average of the bond equivalent rates of ninety-one (91) day treasury bills auctioned for that quarter plus three and one-tenth (3.1) percent is less than the applicable interest rate, then an adjustment shall be made by calculating excess interest in the amount computed under paragraph (b) of this subsection; and

During any period in which a student is eligible to have interest subsidy payments paid on his or her behalf by the secretary, by crediting the excess interest to the amount due from the secretary; or
During any other period, by crediting such excess interest to the reduction of principal to the extent provided in paragraph (c) of this subsection.

(b) Amount of adjustment. The amount of any adjustment of interest on a loan to be made under this subsection for any quarter shall be equal to the applicable interest rate minus the sum of:

The average of the bond equivalent rates of ninety-one (91) day treasury bills auctioned for such calendar quarter, plus three and one-tenth (3.1) percent; multiplied by
The outstanding principal balance of the loan (not including unearned interest added to principal) at the end of such calendar quarter; divided by
Four (4).

(5)

(a) The participating lender shall not collect from a borrower any amount of interest that is payable to the lender by the secretary on behalf of the borrower as a subsidy under the federal Act.

(b) The participating lender shall not charge interest or receive interest subsidies for loans for which the disbursement checks have not been cashed or for which electronic funds transfers have not been completed.

Section 2.

(1) Interest Rates on Unsubsidized Federal Stafford Loans. The annual interest rate on the unpaid principal balance (including any capitalized interest added to principal) of an unsubsidized federal Stafford loan for a borrower shall be the variable rate determined under Section 1(1)(e) of this administrative regulation.

(2) Interest that accrues on loans under this section during periods in which payments of principal are deferred shall, if agreed upon by the borrower and the lender:

(a) Be paid monthly or quarterly; or

(b) Be added to the principal amount of the loan not more frequently than quarterly by the lender.

Section 3. Interest Rates for Federal Supplemental Loans for Students and Federal PLUS Loans.

(1) In general. Except as provided in subsections (2), (3), (5) and (6) of this section, the applicable rate of interest on federal Supplemental Loans for Students and federal PLUS loans made on or after October 1, 1981, shall be fourteen (14) percent per year on the unpaid principal balance (including capitalized interest) of the loan.

(2) The applicable interest rate on a federal SLS loan made to cover a period of enrollment beginning on or after October 17, 1986 or a federal PLUS loan, if the federal SLS loan or federal PLUS is disbursed prior to July 1, 1987, shall be:

(a) Nine (9) percent for a loan made on or after January 1, 1981, but before October 1, 1981;

(b) Fourteen (14) percent for a loan made on or after October 1, 1981, but before November 1, 1982; or

(3) Reduction of rate after decline in treasury bill rates. If for any twelve (12) month period beginning on or after October 1, 1981, the secretary, after consultation with the U.S. Secretary of the Treasury, determines that the average of the bond equivalent rates of ninety-one (91) day treasury bills auctioned for such twelve (12) month period is equal to or less than fourteen (14) percent, the applicable rate of interest for loans made on and after the first day of the first month beginning after the date of publication of the determination shall be twelve (12) percent per year on the unpaid principal balance of the loan.

(4) Increase of rate after increase in treasury bill rates. If for any twelve (12) month period beginning on or after the date of publication of a determination under subsection (2) of this section, the secretary, after consultation with the U.S. Secretary of the Treasury, determines that the average of the bond equivalent rates of ninety-one (91) day treasury bills auctioned for such twelve (12) month period exceeds fourteen (14) percent, the applicable rate of interest for loans made on and after the first day of the first month beginning after the date of publication of that determination under this subsection shall be fourteen (14) percent per year on the unpaid principal balance of the loan.

(5) Availability of variable rates.

(a) Except as provided in paragraphs (c) or (d) of this subsection, for any loan disbursed on or after July 1, 1987, or any new loan made to refinance previous federal SLS loans or federal PLUS loans made prior to that date, the applicable rate of interest during any twelve (12) month period beginning on July 1 and ending on June 30 shall be determined under paragraph (b) of this section, except that the rate shall not exceed twelve (12) percent.

(b) For any twelve (12) month period beginning on July 1 and ending on June 30, the rate determined under this paragraph shall be determined by the secretary on the preceding June 1, after consultation with the U.S. Secretary of the Treasury, and published in the Federal Register as soon as practicable after the date of determination, and shall be equal to the bond equivalent rate of fifty-two (52) week treasury bills auctioned at the final auction held prior to such June 1, plus 3.25 percent.

(c) Notwithstanding paragraph (a) of this subsection, for any federal SLS loan for which the first disbursement is made on or after October 1, 1992, the applicable interest rate shall be determined for any twelve (12) month period beginning on July 1 and ending on June 30 by the secretary on the preceding June 1, after consultation with the U.S. Secretary of the Treasury, and published in the Federal Register as soon as practicable after the date of determination, and shall be equal to the bond equivalent rate of fifty-two (52) week treasury bills auctioned at the final auction held prior to such June 1, plus three and one-tenth (3.1) percent, and the interest rate shall not exceed eleven (11) percent.

(d) Notwithstanding paragraph (a) of this subsection, for any federal PLUS loan for which the first disbursement is made on or after October 1, 1992, the applicable interest rate shall be determined for any twelve (12) month period beginning on July 1 and ending on June 30 by the secretary on the preceding June 1, after consultation with the U.S. Secretary of the Treasury, and published in the Federal Register as soon as practicable after the date of determination, and shall be equal to the bond equivalent rate of fifty-two (52) week treasury bills auctioned at the final auction held prior to such June 1, plus three and one-tenth (3.1) percent, and the interest rate shall not exceed ten (10) percent.

(6) A holder may at any time combine multiple loans that it holds for a borrower under a single repayment schedule, which provides for a single principal payment and a single payment of interest, and interest shall accrue on the combined balance at the weighted average of the rates of all included loans.

(7) Interest that accrues on loans under this section during periods in which payments of principal are deferred shall, if agreed upon by the borrower and the lender:

(a) Be paid monthly or quarterly; or

(b) Be added to the principal amount of the loan not more frequently than quarterly by the lender.

Section 4. Interest on Federal Consolidation Loan. Federal Consolidation loans shall bear interest at an annual rate on the unpaid principal balance of the loan (including any capitalized interest) that is equal to the greater of the weighted average of the interest rates on the loans consolidated, rounded to the nearest whole percent, or nine (9) percent.

Section 5. Capitalization.

(1) A participating lender may add accrued interest and unpaid insurance premiums on a loan to the borrower's unpaid principal balance in accordance with subsections (2) and (3) of this section. This increase in the principal balance of a loan is called "capitalization."

(2) A lender may capitalize interest that has accrued:

(a) During the in-school period or grace period, if capitalization is expressly authorized by the promissory note, or by written consent of the borrower;

(b) During a period of authorized deferment;

(d) During the period from the date the first installment payment was due until it was made.

(3) A lender may capitalize accrued interest under subsection (2)(a) through (c) of this section no more frequently than quarterly, except that capitalization is again permitted when repayment is required to begin or resume. A lender may capitalize accrued interest under subsection (2)(d) of this section only on the date repayment of principal actually begins.

(4) Capitalization on claim. Interest accrued and unpaid at the time of payment of an insurance claim by the authority due to the default or bankruptcy of the borrower shall be capitalized at the time of payment of the claim.

Section 6. Origination and Loan Processing Fees.

(1) Origination fee for a subsidized federal Stafford loan.

(a) Except as provided in paragraph (d) of this subsection, under the subsidized Robert T. Stafford Federal Student Loan program, a participating lender shall charge a borrower an origination fee of five (5) percent of the principal amount of the loan, to be deducted proportionately from each installment disbursement of the proceeds of the loan prior to payment to the borrower.

(b) The origination fee authorized in paragraph (a) of this subsection shall not be taken into account for purposes of determining the amount of interest that may be charged pursuant to Section 1 of this administrative regulation.

(c) The lender shall refund the portion of the origination fee previously deducted from the loan or multiply-disbursed portion thereof by a credit against the borrower's loan balance if:

The loan check is returned uncashed to the lender;
The loan is repaid in full within 120 days of disbursement;
The loan check has not been cashed within 120 days of disbursement; or
The loan proceeds disbursed by electronic funds transfer have not been released from the restricted account maintained by the participating institution within 120 days of disbursement.

(d) The origination fee authorized by paragraph (a) of this subsection shall be increased to five and five-tenths (5.5) percent for any loan made or disbursed during a period of sequestration pursuant to Pub.L. 99-177 (the "Balanced Budget and Deficit Control Act of 1985").

(2) Origination fee for an unsubsidized federal Stafford loan.

(a) The participating lender shall charge the borrower and pay to the secretary a combined origination fee and insurance premium in the amount of six and five-tenths (6.5) percent of the principal amount of the loan, to be deducted proportionately from each installment disbursement of the proceeds of the loan prior to payment to the borrower.

(b) The combined fee and premium shall not be taken into account for purposes of determining the amount of interest that may be charged pursuant to Section 2 of this administrative regulation.

(3) Origination fee for a federal SLS loan or a federal PLUS loan.

(a) On each federal SLS loan or federal PLUS loan made on or after October 1, 1992, the participating lender shall charge the borrower and pay to the secretary an origination fee of five (5) percent of the principal amount of the loan, to be deducted proportionately from each installment disbursement of the proceeds of the loan prior to payments to the borrower.

(4) Administrative charge for refinancing a federal SLS loan or a federal PLUS loan.

(a) A participating lender that makes a new loan to refinance previous federal SLS loans or federal PLUS loans made prior to July 1, 1987 and held by that lender, may charge a borrower an amount not to exceed $100 to cover the administrative costs of making the loan or, not more than one-half (1/2) of which shall be paid to the authority to cover the cost of reissuance.

(b) No administrative fee authorized in paragraph (a) of this subsection may be charged to a borrower by a participating lender that makes a loan to refinance previous federal SLS loans or federal PLUS loans made prior to July 1, 1987 that are held by a holder other than that lender.

(5) Federal Consolidation Loan program. No administrative fee, charged by the authority to a participating lender to cover the costs of increased or extended liability with respect to insurance of a consolidation loan, may be charged to the borrower or otherwise deducted from the loan proceeds.

Section 7. Insurance Premium. The insurance premium is a charge made by the authority to the lender, incident to the guarantee the lender receives against default by the borrower.

(1)

(a) If the insurance premium is provided for in a borrower's promissory note or other written evidence of a subsidized federal Stafford loan, a federal SLS loan, or a federal PLUS loan, including a new federal SLS loan or federal PLUS loan to refinance previous federal SLS loans or federal PLUS loans made prior to July 1, 1987 that are held by a holder other than that lender, a participating lender may charge the borrower a single insurance premium actually paid by the lender to the authority equal to not more than three (3) percent of the principal amount of the loan, by deduction proportionately from each installment disbursement of the proceeds of the loan.

(b) Notwithstanding paragraph (a) of this subsection, no additional insurance fee may be charged to the borrower with respect to a new loan to refinance previous federal SLS loans or federal PLUS loans made prior to July 1, 1987 that are held by the lender of the new loan.

(2) Insurance premium for an unsubsidized federal Stafford loan. A participating lender may charge to a borrower the combined origination fee and insurance premium authorized by Section 6(2) of this administrative regulation.

(3) Federal consolidation loan. No insurance premium shall be charged to the borrower on any federal consolidation loan.

Section 8. Late Charges.

(1) If authorized by the borrower's promissory note or other written evidence of the debt, the holder may require the borrower of any authority insured student loan to pay a late charge under the circumstances described in subsection (2) of this section. This charge shall not exceed six (6) cents for each dollar of each late installment payment.

(2) The holder may require the borrower to pay a late charge if the borrower:

(a) Fails to pay all or a portion of a required installment payment within ten (10) days after it is due; and

(b) Fails to provide written evidence that verifies the borrower's eligibility for an authorized deferment of the payment.

Section 9. Collection Charges.

(1) If provided for in the borrower's promissory note or other written evidence of the debt, the holder may require that the borrower pay costs incurred by the holder or its agent in collecting installments not paid when due, including, but not limited to, attorney's fees, court costs, telegrams, and long distance telephone calls.

(2) The costs referred to in subsection (1) of this section shall not include normal collection costs associated with preparing letters or notices or with making personal contacts with the borrower, such as local telephone calls.

Section 10. Penalty for Prepayment. The borrower shall be entitled to accelerate without penalty repayment of the whole or any part of an authority insured student loan.

History

RELATES TO: KRS 164.744(1), 164.748(1), (3), (14), 164.753(2), 164.766, 34 C.F.R. 682.202, 20 U.S.C. 1077a, 1078(B)(1)
STATUTORY AUTHORITY: KRS 13A.100(3), 164.746(6), 164.748(4), 34 C.F.R. 682.401(b)(10)(ii)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.744(1) empowers the authority to insure loans to students, provided that the loans meet the criteria of the federal Act. Pub.L. 102-325, enacted July 23, 1992, reauthorized the federal Act and made substantial changes in the insured student loan programs. This administrative regulation is necessary to prescribe the charges that lenders may impose on borrowers, either directly or indirectly.
History: 011 KAR 003:045. 19 Ky.R. 1681; eff. 3-4-1993; Crt eff. 9-28-2018; Crt eff. 7-28-2025.

11 KAR 3:055 Obtaining and repaying a loan {#sec-11-kar-3-055 omnilex-key=us-ky-regs-official--title-11--11 KAR 3:055}

Section 1.

(1) Federal Stafford Loan and Federal SLS Loan Application. Generally, to obtain a subsidized or unsubsidized federal Stafford loan or a federal SLS loan insured by the authority, a student shall complete an application. The form of the application may vary depending upon the method of applying (e.g., electronic application process, combined application and note, or separate application and note). The student shall complete his or her portion of the application by providing at least the following information:

(a) The student's name, address, and Social Security number;

(b) The student's citizenship status;

(d) Information on the status of any outstanding student loan indebtedness, including, but not limited to, a certification that the student does not owe repayment of a student grant and is not in default on a student loan;

(e) A certification that the loan proceeds will be used exclusively to meet the cost of attendance at the participating institution listed on the application; and

(f) Additional information necessary to demonstrate that the student meets the eligibility requirements set forth in Sections 1 and 5(1) of 11 KAR 3:015.

(2) Federal PLUS Loan program application. Generally, to obtain a federal PLUS loan insured by the authority, an individual shall complete an application. If the loan is to be made to the student's parent(s), both the student and the parent(s) shall complete the application before submitting it to the participating institution. The form of the application may vary depending upon the method of applying (e.g., electronic application process, combined application and note, or separate application and note). The borrower and a student on whose behalf the loan is sought shall provide at least the following information:

(a) Name, address, and Social Security number of both the borrower and student on whose behalf the loan is sought;

(b) The citizenship status of both the borrower and student on whose behalf the loan is sought;

(d) Information on the status of any outstanding student loan indebtedness of both the borrower and student on whose behalf the loan is sought, including, but not limited to, a certification that neither the borrower nor the student on whose behalf the loan is sought owes repayment of a student grant or is in default on a student loan;

(e) A certification that the loan proceeds will be used exclusively to meet the cost of attendance at the participating institution listed on the application; and

(f) Additional information necessary to demonstrate that both the borrower and the student on whose behalf the loan is sought meet the eligibility requirements set forth in Sections 1 and 5(2) of 11 KAR 3:015.

(3) Federal Consolidation Loan program application. Generally, to obtain a federal Consolidation loan insured by the authority, an applicant shall complete an application, and submit it first to a participating lender holding at least one (1) of the applicant's eligible loans selected for consolidation. If all of the participating lenders holding the applicant's loans selected for consolidation decline to make a federal Consolidation loan to the applicant, then the applicant may submit the application to any other participating lender. The applicant shall provide at least the following information:

(a) The applicant's name, address, and Social Security number;

(b) Information on the status of any outstanding student loan indebtedness, including, but not limited to, a certification that the applicant does not owe repayment of a student grant and is not in default on a student loan;

(c) Additional information necessary to demonstrate that the applicant meets the eligibility requirements set forth in Section 11 of 11 KAR 3:015.

(4) Applications are available through participating institutions and participating lenders. Applications are also available at the offices of the authority, located in Frankfort, Kentucky, during regular business hours (8 a.m. to 4:30 p.m. Monday through Friday).

(5) The applicant shall submit the completed application form for a federal Stafford loan, federal SLS loan, or a federal PLUS loan to the participating institution for certification, and, after the institution certifies the application, the application shall be submitted to a participating lender of the applicant's choice. If the participating institution transmits its data to the authority electronically, the applicant shall submit the completed application form directly to a participating lender of the applicant's choice.

(6) If the participating lender declines to make the loan, the participating lender shall notify the applicant and shall provide to the applicant any disclosure of adverse action that may be required by federal or state laws, including, but not limited to, the Equal Credit Opportunity Act (15 U.S.C. 1691, et seq.). If the participating lender decides to make the loan, the lender may obtain a loan guarantee from the authority not in excess of the applicable loan maximum set forth in 11 KAR 3:035 only if the applicant qualifies as an eligible borrower pursuant to 11 KAR 3:015.

(7) In addition to an application, an eligible borrower shall execute a promissory note approved by the secretary in order to obtain any authority insured student loan. The promissory note may be contained in the application, or may be a separate form. The terms and conditions of the promissory note may vary, based upon the type of loan sought. The promissory note and supplemental disclosure and loan guarantee notices shall constitute evidence of the loan, and shall state directly or by reference to applicable laws and administrative regulations the borrower's rights and responsibilities. Generally, the borrower shall agree to:

(a) Comply with administrative regulations promulgated by the secretary and the authority; and

(b) Repay the full amount of the loan principal, collection costs chargeable to the borrower, any interest not payable by the secretary, and any other charges authorized pursuant to 11 KAR 3:045; and

(c) Inform the holder of the loan of any change in the borrower's name or address, and, with respect to a federal Stafford loan, any change of enrollment status.

History

RELATES TO: KRS 164.744(1), 164.748(1), (3), (14), 164.753(2), 164.766
STATUTORY AUTHORITY: KRS 13A.100(1), 164.746(6), 164.748(4), 34 C.F.R. 682.401(b)(10)(ii)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.744(1) empowers the authority to insure loans to students, provided that the loans meet the criteria of the federal Act. Pub.L. 102-325, enacted July 23, 1992, reauthorized the federal Act and made substantial changes in the insured student loan programs. This administrative regulation is necessary to prescribe the process for obtaining an authority insured student loan.
History: 011 KAR 003:055. 19 Ky.R. 1686; eff. 3-4-1993; Crt eff. 9-28-2018; Crt eff. 7-28-2025.

11 KAR 3:100 Administrative wage garnishment {#sec-11-kar-3-100 omnilex-key=us-ky-regs-official--title-11--11 KAR 3:100}

Section 1.

(1) Following payment of a claim by the authority to a participating lender by reason of the borrower's default in repayment of an insured student loan, the authority, acting through its executive director or other designee, may issue an administrative order for the withholding of the debtor's disposable pay, which order shall conform to the requirements of this section.

(2) This administrative regulation shall apply to a debtor who is either a borrower or an endorser of an insured student loan.

(3) An order for withholding of disposable pay shall not be issued under this section nor become effective less than thirty (30) days after the authority provides a written notice to the debtor by personal service or mail, addressed to the debtor at the residence or employment location last known to the authority. The notice shall include at least the following information:

(a) The name and address of the debtor;

(b) The amount of the debt determined by the authority to be due;

(d) A statement of the intention of the authority to issue an order for withholding of disposable pay;

(e) A statement of the right to dispute the existence, amount, or enforceability of the debt or the terms of a proposed repayment schedule under the garnishment order (other than a repayment schedule agreed to in writing pursuant to paragraph (g) of this subsection);

(f) A statement of the right to inspect and copy any records relating to the debt open to inspection in accordance with KRS 61.870 through 61.884;

(g) A statement of the opportunity to enter into a written agreement with the authority, on terms satisfactory to the authority, establishing a schedule for repayment of the debt;

(h) A statement that, unless there is good cause determined by the authority for the debtor's failure to timely request a hearing, the debtor's acquiescence to the withholding of disposable pay shall be presumed; and

(i) A statement that if the debtor requests a hearing, but fails to appear without good cause determined by the hearing officer, the hearing officer shall affirm the issuance of an order for withholding of disposable pay.

(4) An amount shall not be withheld from the disposable pay of an individual during the first twelve (12) consecutive months of reemployment commenced within twelve (12) months following an involuntary separation from employment.

(5) Establishment of a written repayment schedule in accordance with subsection (3)(g) of this section shall be, for purposes of subsection (3)(e) of this section, conclusive acknowledgement by the debtor of the existence and amount of debt agreed to be paid.

Section 2.

(1)

(a) A hearing shall be provided if the debtor, on or before the 30th day following the date on which the notice required by Section 1(3) of this administrative regulation is mailed, files with the authority a written request for a hearing in accordance with procedures prescribed by this administrative regulation. The timely filing of a request for a hearing (evidenced by a legibly dated U.S. Postal Service postmark or mail receipt) shall automatically stay further collection activity under this administrative regulation pending the outcome of the hearing.

(b) If the debtor requests a hearing, but the request is not timely filed, a hearing shall be provided, but the request shall not stay further action pending the outcome of the hearing provided a decision is rendered in the case by the 60th day following receipt of the request for a hearing. If a final decision is not entered within the sixty (60) day period following receipt of a request for a hearing, the withholding order shall be suspended on the 61st day until a final decision is entered.

(c) A hearing officer, appointed by the authority (who shall not be an individual under the supervision or control of the board other than an administrative law judge), shall conduct the hearing.

(d) The hearing shall be held during regular business hours: Monday through Friday between the hours of 9 a.m. and 4 p.m. Eastern Standard Time.

(e) A hearing officer shall voluntarily disqualify himself and withdraw from a case in which he cannot afford a fair and impartial hearing or consideration.

A party shall request the disqualification of a hearing officer by filing an affidavit, upon discovery of facts establishing grounds for a disqualification, stating the particular grounds upon which he claims that a fair and impartial hearing cannot be accorded.
The request for disqualification and the disposition of the request shall be a part of the official record of the proceeding.
Grounds for disqualification of a hearing officer shall include the following:

a. Participating in an ex parte communication which would prejudice the proceedings;

b. Having a pecuniary interest in the outcome of the proceeding; or

c. Having a personal bias toward a party to a proceeding which would cause a prejudgment on the outcome of the proceeding.

(f) A dispute hearing shall be conducted in Franklin County or another location agreed to by the parties.

(g) In lieu of an in-person hearing, upon request of the debtor, a hearing may be conducted by telephone or the hearing officer may conduct a review based solely upon submission of written material by both the debtor and the authority. An in-person or telephonic hearing shall be mechanically, electronically, or stenographically recorded.

(h) Unless required for the disposition of an ex parte matter specifically authorized by this administrative regulation, a hearing officer shall not communicate off the record with a party to the hearing concerning a substantive issue, while the proceeding is pending.

(2)

(a) The hearing officer's decision, reason therefore, and an explanation of the appeal process shall be rendered in writing no more than sixty (60) days after receipt by the authority of the request for the hearing. The decision shall establish the debtor's liability, if any, for repayment of the debt and the amount to be withheld from the debtor's disposable pay.

(b) Subject to subsection (3)(b) of this section, the hearing officer's decision shall be final and conclusive pertaining to the right of the authority to issue an administrative order for the withholding of the debtor's disposable pay.

(c) A person, upon request, shall receive a copy of the official record at the cost of the requester. The party requesting a recording or transcript of the hearing shall be responsible for transcription costs. The official record of the hearing shall consist of:

All notices, pleadings, motions, and intermediate rulings;
Any prehearing order;
Evidence received and considered;
A statement of matters officially noticed;
Proffers of proof and objections and rulings thereon;
Ex parte communications placed upon the record by the hearing officer;
A recording or transcript of the proceedings; and
The hearing officer's decision or an order of the hearing officer issued pursuant to Section 3(2)(e) of this administrative regulation.

(3)

(a) Following the issuance of the hearing officer's decision, the debtor or the authority may petition the board to review the decision.

(b) An adverse decision by the hearing officer shall be appealed in writing to the board not later than twenty (20) calendar days after the date of the hearing officer's decision. A petition for review of the hearing officer's decision shall be timely filed if received by the executive director within twenty (20) calendar days after the date of the hearing officer's decision. If there is no appeal to the board within twenty (20) days, the findings of the hearing officer shall be conclusive and binding upon the parties.

(c) A petition for review of the hearing officer's decision shall not stay a final order pending the outcome of the review. If the debtor's liability is established by the hearing officer's decision, an administrative order for withholding of disposable pay shall be issued by the authority within sixty (60) days after the date of the hearing officer's decision. If the debtor petitions the board to review the hearing officer's decision and obtains reversal, modification, or remand of the hearing officer's decision, the authority shall return to the debtor any money received pursuant to the withholding order contrary to the final order of the board.

(d) The respondent may, within ten (10) calendar days from the date the petition was received by the executive director, provide a brief statement to the board responding to the petition of review. The response shall be timely filed if received by the executive director within ten (10) calendar days from receipt by the executive director of the petition for review.

(e) A petition for review of the hearing officer's decision shall contain the following information:

A concise statement of the reason that the petitioner asserts as the basis pursuant to paragraph (g) of this subsection for reversing, modifying, or remanding the hearing officer's decision or an order of the hearing officer issued pursuant to Section 3(2)(e) of this administrative regulation;
A statement specifying the part of the official record that the petitioner relies upon to support reversing, modifying, or remanding the hearing officer's decision pursuant to paragraph (g) of this subsection; and
A statement of whether the petitioner believes that oral argument to the board is necessary.

(f) The board shall review the hearing officer's decision at its next regularly scheduled meeting convened at least thirty (30) days after the petition for review of the hearing officer's decision is received or at a special meeting convened for that purpose within ninety (90) days after receipt of the petition for review of the hearing officer's decision, whichever first occurs.

(g) The board shall decide the dispute upon the official record, unless there is fraud or misconduct involving a party, and may consider oral arguments by the debtor and the authority. The board shall:

Not substitute its judgment for that of the hearing officer as to the weight of the evidence on questions of fact; and

a. Uphold the hearing officer's decision unless it is clearly unsupported by the evidence and the applicable law;

b. Reject or modify, in whole or in part, the hearing officer's decision; or

c. Remand the matter, including an order of the hearing officer issued pursuant to Section 3(2)(e) of this administrative regulation, in whole or in part, to the hearing officer for further proceedings if it finds the hearing officer's final order is:

(i) In violation of constitutional or statutory provisions;

(ii) In excess of the statutory authority of the agency;

(iii) Without support of substantial evidence on the whole record;

(iv) Arbitrary, capricious, or characterized by abuse of discretion; or

(v) Based on an ex parte communication which substantially prejudiced the rights of a party and likely affected the outcome of the hearing.

(h) The final order of the board shall be in writing. If the final order differs from the hearing officer's decision, it shall include separate statements of findings of fact and conclusions of law.

(4) The remedies provided in this section shall not:

(a) Preclude the use of other judicial or administrative remedies available to the authority under state or federal law; and

(b) Be construed to stay the use of another remedy.

Section 3. Hearing Procedure.

(1) The debtor shall have the right to be heard by the hearing officer, be represented by counsel, present evidence, cross examine, and make both opening and closing statements.

(2)

(a) Upon request of a party, the hearing officer may issue a subpoena for the production of a document or attendance of a witness.

(b)

Not more than ten (10) business days after the date of filing the request for a hearing or a review of written material, the debtor shall submit to the counsel for the authority a written statement specifically stating the basis of dispute.
Not less than fifteen (15) business days prior to the hearing, the parties shall:

a. Confer and jointly stipulate the issues that are in controversy to be resolved by the hearing officer;

b. Discuss the possibility of informal resolution of the dispute;

c. Exchange a witness list of the names, addresses, and phone numbers of each witness expected to testify at the hearing and a brief summary of the testimony of each witness that the party expects to introduce into evidence; and

d. Exchange an exhibit list identifying documents to be admitted into evidence at the hearing and provide a legible copy of all exhibits.

a. If the debtor is unavailable or otherwise fails to confer and jointly stipulate the issues pursuant to subparagraph 2 of this paragraph, the authority shall serve upon the debtor proposed stipulation of issues. If within five (5) calendar days, the debtor fails to respond to the proposed stipulation of issues, the debtor shall be precluded from raising an additional issue not identified in the proposed stipulation of issues.

b. If the debtor is unavailable or otherwise fails to cooperate in a timely manner for the exchange of the witness or exhibit lists, the debtor shall be precluded from admitting the information as part of the evidence at the hearing.

The authority shall provide to the hearing officer the documentation submitted in accordance with subparagraph 1 of this paragraph and shall report to the hearing officer the results of the discussions between the parties described in subparagraphs 2 and 3 of this paragraph.
Additional time for compliance with the requirements of this paragraph may be granted by the hearing officer, upon request, if it does not prejudice the rights of the authority or delay the rendering of a hearing decision within the time prescribed in this subsection.
If the debtor requests a hearing, but the debtor's written statement and supporting documentation, considered from a viewpoint most favorable to the debtor, does not reflect a genuine issue of fact or prima facie defense to the legal enforceability of the authority's claim, the hearing officer, on petition of the authority and notice to the debtor, may enter an order dismissing the request for a hearing and authorizing issuance of the order described in Section 5 of this administrative regulation.

(c) Facts recited in the authority's notice pursuant to Section 1(3) of this administrative regulation that are not denied shall be deemed admitted. Each party shall remain under an obligation to disclose new or additional items of evidence or witnesses which may come to their attention as soon as practicable.

(d)

Either party, without leave of the hearing officer, may depose a witness, upon reasonable notice to the witness and the opposing party, and submit to the opposing party interrogatories or request for admissions.
The party receiving interrogatories or request for admissions shall respond within fifteen (15) calendar days.
Each matter of which an admission is requested shall be deemed admitted unless, within fifteen (15) days after service of the request or a shorter or longer time that the hearing officer may allow, the party to whom the request is directed serves upon the party requesting the admission a written answer or objection addressed to the matter.

(e) Sufficient grounds for entry of an appropriate order by the hearing officer, including postponement, exclusion of evidence, dismissal of the appeal, quashing the withholding order, or vacating the stay, shall exist if there is:

Noncompliance with this subsection;
Failure of the authority to:

a. Timely appoint a hearing officer; or

b. Respond to a request for inspection of records; or

Failure of the debtor to submit information in accordance with paragraph (b) of this subsection.

(3) Order of proceeding.

(a) The hearing officer shall:

Convene an in-person or telephonic hearing;
Identify the parties to the action and the persons participating;
Admit into evidence the notice required by Section 1(3) of this administrative regulation and the debtor's statement and the stipulations required by subsection (2)(b)1 and 2 of this section;
Solicit from the parties and dispose of any objections or motions;
Accept into evidence any documentary evidence not objected to;
Solicit opening statements; and
Proceed with the taking of proof.

(b) The taking of proof shall commence first by the debtor and then by the authority, with opportunities for cross-examination, rebuttal, and closing statements.

(4) Rules of evidence.

(a) All testimony shall be made under oath or affirmation.

The hearing officer shall not admit evidence that is excludable as a violation of an individual's constitutional or statutory rights or a privilege recognized by the courts of the Commonwealth.
Statutes or judicial rules pertaining to the admission of evidence in a judicial proceeding shall not apply to a hearing under this section.
The hearing officer may receive evidence deemed reliable and relevant, including evidence that would be considered hearsay if presented in court, except that hearsay evidence shall not be sufficient in itself to support the hearing officer's decision.
A copy of a document shall be admissible if:

a. There is minimal authentication to establish a reasonable presumption of its genuineness and accuracy; or

b. It is admitted without objection.

The hearing officer may exclude evidence deemed unreliable, irrelevant, incompetent, immaterial, or unduly repetitious.

(b) An objection to an evidentiary offer may be made by any party and shall be noted in the record.

May take official notice of:

a. Statutes and administrative regulations;

b. Facts which are not in dispute; and

c. Generally-recognized technical or scientific facts;

Shall notify all parties, either before or during the hearing of a fact so noticed and its source; and
Shall give each party an opportunity to contest facts officially noticed.

(d) At the discretion of the hearing officer, the parties may be allowed up to fifteen (15) days following the hearing to submit written arguments or briefs.

(5) Upon request of either party, the record of the hearing shall be transcribed, and shall be available to the parties at their own expense.

(6) Burden of proof.

(a) The authority shall have the burden to establish the existence and amount of the debt.

(b) The debtor shall have the burden to establish an affirmative defense.

(c) The party with the burden of proof on an issue shall have the burden of going forward and the ultimate burden of persuasion as to that issue. The ultimate burden of persuasion shall be met by a prima facie establishment of relevant, uncontroverted facts or, if relevant facts are disputed, a preponderance of evidence in the record.

(d) Failure to meet the burden of proof shall be grounds for a summary order from the hearing officer.

Section 4. Defenses.

(1) Except as provided in subsection (2) of this section, a debtor may assert a defense to the issuance of an administrative order to withhold the debtor's disposable pay, legal or equitable, pertaining to the existence, amount, or enforceability of the debt or the terms of a proposed repayment schedule under the garnishment order (other than a repayment schedule agreed to in writing pursuant to Section 1(3)(g) of this administrative regulation).

(2) The hearing officer shall not consider as a defense a question of law or fact that has previously been adjudicated by a court of competent jurisdiction or by an independent third-party trier of fact in an administrative proceeding involving the debtor and the authority pertaining to the existence, amount, or the debtor's liability on the particular debt in question or the terms of a prior repayment schedule.

(3) If the debtor asserts as a defense a question of law or fact that was previously raised in an administrative proceeding before the authority pursuant to 11 KAR 4:030 or 11 KAR 4:050, the hearing officer:

(a) Shall:

Consider the matter; and
Give deference to the prior decision by the authority in the same manner that a court would give deference in reviewing the decision of an administrative agency; and

(b) May reverse the prior decision if the debtor presents evidence that:

Circumstances have changed or new information is available; or
The prior decision:

a. Substantially disregarded or ignored the defense; or

b. Was arbitrary, capricious, not supported by the facts, or made through fraud.

(4) If the debtor asserts as a defense a claim of entitlement to discharge of the particular debt pursuant to 34 C.F.R. 682.402, except for reason of bankruptcy, but has not previously sought discharge by the authority for that specific reason, the hearing officer shall stay the hearing for a period sufficient to permit the debtor to submit documentation to the authority for a determination of eligibility for entitlement to the discharge. At the expiration of the period of stay, the hearing officer shall review the circumstances and:

(a) Uphold the right of the authority to issue an order of wage withholding if the debtor has failed to submit documentation to the authority for review of entitlement to discharge;

(b) Dismiss the request for hearing if the debtor has submitted documentation and the authority has approved discharge of the debt; or

(c) Proceed with the hearing if the debtor submitted documentation and the authority denied discharge, except that the hearing officer shall consider the defense of entitlement to discharge in accordance with subsection (3) of this section.

(5) If the debtor asserts as a defense a claim that the debt was dischargeable in a previous bankruptcy pursuant to 11 U.S.C. 523(a)(8), but the debtor did not previously seek discharge by the bankruptcy court, the hearing officer shall stay the hearing for a period sufficient to permit the debtor to reopen the bankruptcy case. At the expiration of the period of stay, the hearing officer shall review the circumstances and:

(a) Uphold the right of the authority to issue an order of wage withholding if the debtor has failed to obtain the bankruptcy court's permission to reopen the bankruptcy case to seek discharge of the particular debt; or

(b) Dismiss the request for hearing if the bankruptcy court has reopened the bankruptcy case to consider discharge of the particular debt.

(6)

(a) If the debtor asserts as a defense a claim that withholding of his disposable pay would constitute an extreme financial hardship, the debtor shall submit documentation of all available resources and actual expenses and shall have the burden of demonstrating the necessity of actual expenses.

(b) The hearing officer shall compare the debtor's available resources and the necessary expenses and current debt obligations of the debtor and debtor's dependents. The hearing officer shall determine that extreme financial hardship exists if the debtor currently is not able to provide at least minimal subsistence for the debtor and debtor's dependents that could be claimed on a federal income tax return. The hearing officer shall consider as available resources of the debtor income of the debtor, the debtor's spouse, and debtor's dependents from all sources, including nontaxable income and government benefits, expenses paid on behalf of the debtor by another person, and the cash value of any current liquid assets, such as bank accounts and investments. The hearing officer shall consider the claim of extreme financial hardship in accordance with the presumptions established in this paragraph.

Withholding of an amount of disposable pay shall constitute an extreme financial hardship if the debtor's available resources from all sources do not exceed the applicable poverty guideline, multiplied by 125 percent, based on the debtor's family size and state of residence. The poverty guidelines to be utilized for this purpose shall be the latest federal poverty measurement guidelines issued by the United States Department of Health and Human Services and published annually in the Federal Register, under the authority of 42 U.S.C. 9902(2).
The debtor's actual monthly expenses shall be compared to the most recently revised Collection Financial Standards issued by the Internal Revenue Service based on the debtor's family size and state of residence. Actual expenditures by the debtor's family that exceed the applicable amount for a category shall be presumed unnecessary.

Section 5.

(1) An administrative order issued by the authority to withhold disposable pay shall be served upon the debtor's employer personally or by mail. A notice of the issuance of the order shall be provided to the debtor by regular first class mail. The order shall require the withholding and delivery to the authority of not more than fifteen (15) percent of the debtor's disposable pay, except that a greater percentage may be deducted upon the written consent of the debtor.

(2) The order shall state the amount or percentage to be withheld and the amount of the debt, the statutory and regulatory basis therefore, and the time withholding is to begin.

(3) The order shall continue to operate until the debt is paid in full with interest accrued and accruing thereon at the prescribed rate in the promissory note or applicable law and collection costs that may be charged to the borrower under the promissory note or applicable law. The order shall have the same priority as provided to a judicially ordered garnishment prescribed in KRS 425.506.

(4) An employer who has been served with an administrative order for withholding of earnings shall answer the order within twenty (20) days, and shall provide a copy to the debtor the first time that withholding occurs and each time thereafter that a different amount is withheld. The employer shall be liable to the authority for a lawfully due amount which the employer fails to withhold from disposable pay due the debtor following receipt of the order, plus attorneys' fees, costs, and, in the discretion of a court of competent jurisdiction, punitive damages.

(5) A withholding under this section shall not be grounds for discharge from employment, refusal to employ, or disciplinary action against an employee subject to withholding under this section.

(6) The employer shall have no liability or further responsibility after properly, completely, and timely fulfilling the duties under this section.

Section 6.

(1) Whenever this administrative regulation requires delivery of a notice, subpoena, or other communication by personal service, the service shall be made by:

(a) An officer authorized under KRS 454.140 to serve process; or

(b) A person over the age of eighteen (18) years of age, who shall prove service by affidavit or by the signature of the person being served.

(2) Receipt of a notice or other communication by the debtor shall be rebuttably presumed if the person to be served or another adult with apparent authority at the place of residence or employment last known to the authority signs a receipt or refuses to accept the notice or communication after identification and offer of delivery to the person so refusing.

(3) For an administrative order to withhold disposable pay served upon an employer, receipt shall provide a rebuttable presumption if:

(a) The person to whom the order is directed signs or refuses to sign a receipt; or

(b) His employee or agent with apparent authority signs or refuses to sign a receipt.

History

RELATES TO: KRS 164.744(1), 164.748(4), (10), (20), 164.753(2), 34 C.F.R. 682.410(b)(9), 20 U.S.C. 1071-1087-2, 1095a
STATUTORY AUTHORITY: KRS 164.748(4), 164.753(2), 20 U.S.C. 1095a
NECESSITY, FUNCTION, AND CONFORMITY: Pursuant to KRS 164.744(1) and 164.748(2), the Kentucky Higher Education Assistance Authority has entered into agreements with the secretary to provide loan guarantees in accordance with 20 U.S.C. 1071 through 1087-2. 20 U.S.C. 1095a permits a student loan guarantee agency to garnish the disposable pay of a borrower to recover a loan guaranteed pursuant to 20 U.S.C. 1071 through 1087-2, notwithstanding a provision of state law. That section also permits the student loan guarantee agency to establish procedures for requesting and conducting a hearing related to the wage garnishment. KRS 164.748(10) authorizes the authority to collect from borrowers loans on which the authority has met its guarantee obligation, and KRS 164.748(20) authorizes the authority to conduct administrative hearings, exempt from KRS Chapter 13B, pertaining to wage garnishment. This administrative regulation establishes the procedures for implementing wage garnishment in accordance with requirements of the federal act.
History: 011 KAR 003:100. 18 Ky.R. 3541; 414; eff. 8-20-1992; 19 Ky.R. 2475; 96; eff. 8-5-1993; 21 Ky.R. 49; eff. 9-12-1994; 25 Ky.R. 375; 798; eff. 10-1-1998; 26 Ky.R. 847; eff. 12-16-1999; 2257; 27 Ky.R. 453; eff. 8-14-2000; 3290; eff. 8-15-2001; 29 Ky.R. 146; eff. 10-7-2002; 30 Ky.R. 338; 821; eff. 10-31-2003; 31 Ky.R. 116; eff. 9-13-2004; 31 Ky.R. 1830; 32 Ky.R. 14; eff. 8-5-2005; 33 Ky.R. 162; 698; eff. 10-6-2006; 34 Ky.R. 93; eff. 9-10-2007; 35 Ky.R. 63; eff. 9-8-2008; 36 Ky.R. 109; eff. 10-12-2009; 37 Ky.R. 71; eff. 10-1-2010; 37 Ky.R. 1736; 4-1-2011; 38 Ky.R. 49; 464; eff. 10-7-11; 38 Ky.R. 1977; 39 Ky.R. 187; eff. 8-31-2012; 40 Ky.R. 58; eff. 9-9-2013; 41 Ky.R. 817; 1485; eff. 2-6-2015; Crt eff. 9-28-2018; Crt eff. 7-28-2025.

Chapter 4 Kentucky Higher Education Assistance Authority

11 KAR 4:020 Disapproval, assessment of liabilities, limitation, suspension or termination of eligibility to participate in authority programs {#sec-11-kar-4-020 omnilex-key=us-ky-regs-official--title-11--11 KAR 4:020}

Section 1. Definitions.

(1) "Authority" is defined by KRS 164.740(1).

(2) "Authority program" means a program of student financial assistance administered or funded by the authority pursuant to KRS 164.740 through 164.785 or the federal act.

(3) "Board" is defined by KRS 164.740(2).

(4) "Delegated officer" means the executive director, general counsel, chief operating officer, or any other individual the board may designate to whom the board has delegated ministerial responsibilities set forth in this administrative regulation.

(5) "Eligible institution" is defined by KRS 164.740(4).

(6) "Eligible lender" is defined by KRS 164.740(5).

(7) "Federal act" is defined by KRS 164.740(8).

(8) "Funds" means any money, commitments to provide money, and commitments of insurance under any authority program.

(9) "Insured student loan" is defined by KRS 164.740(11).

(10) "Limitation" means:

(a) A limit on the number or percentage of students enrolled or planning to enroll in a participating institution who may receive funds through an authority program;

(b) A limit, for a stated period of time, on the percentage of a participating institution's total receipts from tuition and fees derived from authority program funds;

(c) A requirement that an institution that is already participating obtain a bond, in a specified amount, to assure its ability to meet its financial obligations to students, lenders and the authority funds;

(d) A limit on the number or amount of insured loans that may be made or held by a participating lender or that may be received by students at a participating institution; or

(e) Any special conditions or procedures required in the administration of authority programs.

(11) "Participating institution" is defined by KRS 164.740(14).

(12) "Participating lender" is defined KRS 164.740 (15).

(13) "Secretary" is defined by KRS 164.740(20).

Section 2. Standard of Conduct.

(1) A participating institution shall establish and consistently implement policies and procedures to ensure that:

(a) The institution fully and continuously complies with all statutory, regulatory, and contractual requirements related to the administration of authority programs and performs all duties and responsibilities to:

Students:
Participating lenders;
The authority; and
If applicable to participation in an authority program, the secretary;

(b) The institution makes full and accurate representations of facts required to be reported or disclosed or voluntarily disclosed to:

Students;
Participating lenders;
The authority; and
If applicable to participation in an authority program, the secretary;

(c) The institution disburses, holds, and accounts for funds administered through any authority program with the standard of care and diligence of a fiduciary;

(d) The institution makes timely refunds to students as required by administrative regulations issued by the secretary or satisfies, within thirty (30) days of issuance, a final judgment attained by a student seeking a refund;

(e) Neither the institution owner, director, or officer of the institution is found guilty in any criminal, civil, or administrative proceeding or liable in any civil or administrative proceeding regarding the obtaining, maintenance, or disbursement of state or federal grant, loan or work assistance funds; and

(f) Neither the institution or an owner, director, or officer of the institution has unpaid financial liabilities involving the improper acquisition, expenditure, or refund of state or federal financial assistance funds.

(2) A participating lender in the authority's insured student loan program shall establish and consistently implement policies and procedures to ensure that it:

(a) Fully and continuously complies with all statutory, regulatory, and contractual requirements related to the administration of authority programs and performs all duties and responsibilities to:

Students;
The authority; and
The secretary;

(b) Performs directly, or by contract with a third party servicer, due diligence in the approval, making, servicing and collection of authority insured student loans and in the timely and accurate filing of insurance claims on those loans.

Students;
The authority; and
The secretary.

(3) A participating institution and a participating lender shall establish, maintain, and make accessible to the authority, and if applicable to participation in an authority program, to the secretary a system of complete and accurate records sufficient to demonstrate:

(a) Compliance with all statutory, regulatory, and contractual requirements related to the administration of authority programs and the performance of all duties and responsibilities to:

Students;
The authority; and
If applicable to participation in an authority program, the secretary;

(b) Full and accurate disclosure of facts required to be reported or disclosed or voluntarily disclosed to:

Students;
The authority; and
If applicable to participation in an authority program, the secretary; and

(4) Noncompliance with the standard of conduct in this section by an eligible institution or an eligible lender shall be grounds for disapproval or limitation of participation and noncompliance with the standard of conduct by a participating institution or a participating lender shall be grounds for assessment of liabilities, limitation, suspension, or termination. The delegated officer may, upon receipt of a complaint or other reliable information indicating that a participant may be in violation of applicable laws, administrative regulations, special arrangements, agreements, or limitations, without restricting the availability of other remedies provided in this administrative regulation, give the participant an opportunity to respond to the complaint or information and show that the violation has been corrected or submit an acceptable plan for correcting the violation and preventing its recurrence. The delegated officer shall not delay the procedures for assessment of liabilities, limitation, suspension, or termination. During the informal compliance process if the delay would result in harm to the authority, students, or the secretary or the informal compliance procedure will not result in correction of the alleged violation.

Section 3. Disapproval. The board or any of its delegated officers may, upon verification of misstatements of fact, financial instability, lack of administrative capability, or failure to meet eligibility requirements under applicable law or administrative regulations, related to an application to participate in an authority administered program, notify the applicant of the authority's intent to disapprove such application. For purposes of requesting review of a limitation on participation (including a requirement of a surety bond or other collateral) imposed as a precondition of initial approval or reinstatement, such limitation shall be regarded as a disapproval.

Section 4. Assessment of Liabilities.

(1)

(a) The board or any of its delegated officers may, initiate action to assess liabilities against a participating institution or a participating lender for payment or reimbursement of student financial assistance funds, upon evidence that a participant has, through acts of commission or omission, improperly expended or diverted to an improper purpose student financial assistance funds, improperly certified eligibility of a student or insured student loan borrower, or overcharged a student, a participating lender, the authority or the secretary.

(b) Conditions for which liabilities may be assessed include:

Disbursement of funds:

a. In excessive amounts;

b. To ineligible students or insured student loan borrowers;

c. In a manner not authorized by applicable laws or administrative regulations;

d. Without documentation; or

e. To students or insured student loan borrowers, after the academic year or period of enrollment for which the funds were authorized or awarded;

Retention of funds or failure to remit funds due on a timely basis;
Certification of an ineligible student;
Misappropriation or diversion of student financial assistance funds to a purpose other than the purpose for which the funds were awarded and sent to the participating institution;
Overcharging of fees, interest, or special allowance by a participating lender; or
Failure to account for funds received or expended to properly administer any program for which the participant has previously been approved.

(c) A demand by the authority to a participating institution for return of undisbursed student financial assistance funds remaining in the possession of the institution shall not be deemed an assessment of liability subject to appeal under this administrative regulation.

(2) The board or its delegated officer may notify a participating institution or a participating lender that the authority requires the participant to take reasonable and appropriate corrective action to remedy a violation of applicable laws, administrative regulations, special arrangements, agreements or limitations. The corrective action may include payment of any funds to the authority, or to designated recipients, which the participant improperly received, withheld, disbursed or caused to be awarded or disbursed. Corrective action may, for example, relate to:

(a) With respect to the insured student loan program:

Ineligible interest benefits, special allowance, or claims paid by the authority; and
Discounts, premiums or excess interest paid in violations of rules of the secretary; and

(b) With respect to all authority programs:

Refunds due to students under program administrative regulations; and
Any grants, work-study assistance, scholarships or loans caused to be awarded or disbursed to ineligible students, in excess of legal maximums, or otherwise in violation of applicable administrative regulations.

Section 5. Limitation. The board or any of its delegated officers may, upon evidence that a participating institution or a participating lender has failed through acts of commission or omission to fully adhere to the standard of conduct set forth in Section 2 of this administrative regulation pertaining to any authority administered program for which the participant has previously been approved, notify the participant of the authority's intent to place limits on the participant's eligibility to participate in authority administered programs.

Section 6. Suspension. The board or any of its delegated officers may, upon evidence that a participating institution or a participating lender has substantially or repeatedly failed through acts of commission or omission to adhere to the standard of conduct set forth in Section 2 of this administrative regulation pertaining to any authority administered program for which the participant has previously been approved, notify the participant of the authority's intent to suspend the participant's eligibility to participate in authority administered programs for a period not to exceed sixty (60) days, unless the authority and participant agree otherwise or the delegated officer initiates a limitation or termination during the sixty (60) days.

Section 7. Termination.

(1) The board or any of its delegated officers may, following any period of limitation or suspension, in the absence of correction of deficiencies which resulted in the adverse action, notify the participant of the authority's intent to terminate a participant's eligibility to participate in all or any of the authority administered programs.

(2) The board or any of its delegated officers may, with or without prior limitation or suspension, notify the participant of the authority's intent to terminate the participation of a participating institution or a participating lender upon evidence of:

(a) An intentional violation of applicable laws and administrative regulations, including the standard of conduct set forth in Section 2 of this administrative regulation; or

(b) A substantial pattern or practice indicating failure or inability to adhere to the standard of conduct set forth in Section 2 of this administrative regulation, including but not limited to a repetition of previously cited deficiencies;

(3) A termination prohibits a participant or the authority from making or increasing awards under authority programs, making any other new obligations against authority funds, and prohibits further guarantee commitments by the authority under the insured student loan programs.

(4) The participation of an educational institution or lender shall be deemed automatically terminated without prior action or notice by the authority upon cessation of operation as an ongoing business, loss of state licensure, or termination of its eligibility by the secretary.

Section 8. Emergency Action.

(1) Under an emergency action, the board acting through its delegated officer may immediately withhold program funds from the students attending a participating institution or from a participating lender, withdraw the right of the participant to certify or approve applications, and preclude the participant from obligating or disbursing funds under any authority program. The delegated officer may initiate an emergency action against a participant only if that officer:

(a) Receives information, determined by the delegated official to be reliable:

That the participant is substantially failing to adhere to the standard of conduct set forth in Section 2 of this administrative regulation or is violating any provision of statute, administrative regulation, or any applicable special arrangement, agreement, or limitation; or
That the participant has misrepresented any material facts to students, the authority, or, as applicable to participation in an authority program, the secretary; or
That the participant ceases to meet the requirements for approval of participation by the authority;

(b) Determines that immediate action is necessary to prevent loss or misuse of funds; and

(c) Determines that the risk of loss or misuse outweighs the importance of delaying the effective date of action through the procedures for limitation, suspension, or termination contained in this administrative regulation.

(2) The emergency action takes effect on the date a notice, personally delivered or mailed to the participant by the delegated officer by certified mail, return receipt requested, is received by the participant. The notice shall state the basis on which the emergency action is based, the consequences of the emergency action to the institution or lender, and that the participant may request an opportunity to show cause why the emergency action is unwarranted. An emergency action may not exceed thirty (30) days unless the board or a delegated officer initiates a limitation, suspension, or termination proceeding under this subpart against the participant within those thirty (30) days, in which case the delegated officer may extend the emergency action until the completion of those proceedings, including any appeal. The continuation, modification, or cessation of the emergency action during the period described in this paragraph is at the sole discretion of the delegated officer.

Section 9. Notices.

(1) If the delegated officer finds that the authority should assess any liabilities or that participation of any applicant or participant should be disapproved, limited, suspended or terminated by act of the authority, the applicant or participant shall be provided with notice of such action which shall be issued on behalf of the board and signed by the officer and shall contain a concise statement of the consequences and reason for the disapproval, assessment of liabilities, limitation, suspension or termination of participation and sufficient information to reasonably apprise the applicant or participant of the right to request reconsideration of disapproval or submit to the authority a request for a hearing on all issues contained therein or written material indicating why the action should not take place. The proposed date for payment of any assessed liabilities or the proposed effective date of any limitation, suspension or termination, which shall be more than twenty (20) days after the date of mailing of the notice of intent, shall be specified in the notice. The assessment of liabilities shall be based upon payment by the specified due date, and any extension of that date due to a request for a hearing or further appeal may result in the accrual of additional amounts due if interest accrual is applicable.

(2) All requests for hearings shall be made to the authority at its office located in Frankfort, Kentucky 40601, within twenty (20) days of receipt of the notice. All notices to or from the authority shall be personally delivered by an individual at least eighteen (18) years old, who shall prove service by his affidavit or signature of the recipient, or by forwarding the notice by U.S. certified mail, return receipt requested, to the address of the applicant or participant (as reflected by the records of the authority) or to the authority. If a party refuses to accept a notice served under this section, the notice shall be deemed received on the date that the party refuses to accept the notice.

Section 10. Request for Review.

(1) An eligible institution or an eligible lender seeking reconsideration of a final determination of disapproval shall file a written request together with any relevant records or materials for review with the delegated officer issuing the determination no later than forty-five (45) days from the date it receives the determination. The applicant shall identify the issues and facts in dispute and the applicant's position together with the pertinent facts and reasons supporting that position.

(2) An applicant requesting review of the determination of disapproval issued by the delegated officer shall have the burden of proving that the applicant complied with requirements for approval. An applicant may submit as additional evidence to the delegated officer only materials within one (1) or more of the following categories:

(a) Complete audit reports and audit work papers for audits performed by the United States Education Department or independent audit work papers, records, and other materials;

(b) Complete program review reports and reports of resolution of disputed program reviews;

(c) Complete accreditation or licensure review reports and reports of resolution of disputed accreditation or licensure findings;

(d) Internal records and other materials if the records or materials are not:

Related to a period of time other than the period of time under consideration;
Related to an audit or program review of an institution or lender other than the applicant (unless the determination involves a change of ownership); or
Related to policies and procedures that have not yet been implemented.

Section 11. Stay of Proceedings. A limitation, suspension or termination will not be effective on the date specified in the notice if the delegated officer receives a timely request for a hearing, and the proposed effective date shall continue to be stayed pending the outcome of a hearing.

Section 12. Hearings.

(1) In the event assessment of liabilities, limitation, suspension or termination of eligibility results from the action of a delegated officer of the authority, the participant may request a hearing to determine the facts in the case or submit written material indicating why the action should not take place. If the participant does not request a hearing, but submits written material, the delegated officer shall consider that material and notify the participant that either the proposed action is dismissed or the proposed action shall take effect on a specified date. Nothing in this section shall preclude the delegated officer, at his sole discretion, from engaging in informal discussions with representatives of the participant for the purpose of settling the dispute.

(2) Notification of hearing. Upon receipt of a participant's request for a hearing, the delegated officer shall arrange for a hearing on the record before a hearing officer, and within thirty (30) days of the delegated officer's receipt of an institution's request for review, the hearing officer shall establish a schedule for any discovery, prehearing conferences, and the time and place of the hearing, which shall be scheduled to occur no later than 120 days from the date upon which the delegated officer receives the request for a hearing.

(3) At a hearing the officer or officers of the participant may be accompanied by counsel of their own choosing and at their own expense. The hearing may be conducted by a hearing officer or a hearing committee appointed by the board. The participant proceeded against shall be entitled to be represented at the hearing in person or by counsel or both and shall be entitled to introduce testimony by witnesses or, if the hearing officer so permits, by depositions.

(4) A prehearing conference may be convened by the hearing officer if he or she thinks that such a conference would be useful, or if requested by the authority or the participant to allow the parties to settle or narrow the dispute. If agreed to by the hearing officer and the parties, a prehearing conference may consist of a conference telephone call, an informal meeting, or the submission and exchange of written material.

(5) The hearing process may be expedited as agreed by the hearing officer and the parties. Procedures to expedite may include, but are not limited to, the following:

(a) Scheduling of conferences;

(b) Setting time limits for hearings, submission of written documents, and discovery;

(d) Shortening any time limits prescribed in this administrative regulation;

(e) Limiting the hearing to written documentation; or

(f) Stipulation by the parties to facts and legal authorities not in dispute.

(6) The formal rules of evidence and procedures applicable to proceedings in a court of law are not applicable. However, only evidence that is relevant and material to the proceeding and is not unduly repetitious shall be admissible, and discussions of settlement between the parties or the terms of settlement offers are not admissible. The hearing officer shall not admit evidence that is excludable on constitutional or statutory grounds or privileged as recognized in the courts of the Commonwealth. Hearsay evidence shall be admissible, but shall not be sufficient in itself to support the hearing officer's decision. All testimony shall be made under oath. Evidentiary objections may be made at any time during the prehearing or hearing process and shall be noted in the record of the hearing.

(7) The burden of proof in any hearing under this section will be determined in accordance with the provisions of KRS 13B.090.

(8) Discovery, as provided for under the Kentucky Rules of Civil Procedure, is permitted, except that, in recognition of the authority's contractual right to inspect records and the participant's right to inspect public records under KRS 61.870 et seq., the hearing officer may limit the scope, method, and time for discovery as appropriate to expeditiously and fairly resolve the issues, and the hearing officer may summarily rule against a noncomplying party. The hearing officer may not issue subpoenas. Nothing in this subsection shall be construed as allowing access to the personal notes, observations, or conclusions of authority staff or to the work product of counsel.

(9) The authority shall provide for recording of the proceeding and shall make the record available to the participant upon its request and upon its payment of any fee required by the individual providing a transcript.

(10) The hearing officer shall regulate the course of the proceeding and conduct of the parties during the hearing and take all steps necessary to conduct a fair and impartial proceeding. The parties shall provide available personnel who have knowledge about the matter under review for oral or written examination. The hearing officer shall take whatever measures are appropriate to expedite the proceeding, and may terminate the hearing and issue a decision against a party failing to comply with any time limits or procedure.

(11)

(a) Hearing officers and hearing committees shall prepare findings of fact and conclusions of law based only on evidence considered at the hearing and on matters given official notice, and shall issue a written initial decision to the parties by certified mail, return receipt requested, within sixty (60) days after the last brief is filed, the last day of the hearing (if the hearing officer does not request the parties to submit briefs), or the date on which the hearing officer terminates the hearing.

(b) The hearing officer's decision shall state whether the imposition of the liabilities, limitation, suspension or termination sought by the delegated officer is warranted, in whole or in part.

(c) If the action brought against a participant involves its failure to provide a surety bond, letter of credit or other collateral in the amount specified by the delegated officer, the hearing officer shall find that the amount of the bond, letter of credit or other collateral specified by the delegated officer was appropriate unless the participant can demonstrate that the amount was unreasonable.

Section 13. Decisions and Appeals.

(1) All initial assessing liabilities, disapproving, limiting, suspending or terminating participation may be made by a delegated officer of the authority and shall be binding upon the authority and the applicant or participant as the decision of the board in the absence of a request for review of disapproval in accordance with Section 10 of this administrative regulation or an appeal of other actions in accordance with Section 12 of this administrative regulation by the applicant or participant to the authority.

(2) In the event the applicant, participant, or a delegated officer of the authority does not petition the board for a review of the hearing officer's decision, the decision resulting from a hearing conducted by the authority shall become final and conclusive as the decision of the board twenty (20) days after notice thereof is given as provided.

(3)

(a) An appeal to the board of a hearing officer's initial decision is made by sending a written notice of appeal to the executive director of the authority. This notice must be postmarked not later than twenty (20) days after the issuance of the hearing officer's initial decision, and the appealing party shall send a copy of its appeal notice to the other party.

(b) Within ten (10) days after submitting the notice of appeal, the party that appeals shall submit a brief to the board explaining why the initial decision of the hearing officer should be overturned or modified. The appealing party may submit proposed findings of fact or conclusions of law. However, the proposed findings of fact shall be supported by the evidence introduced into the record at the hearing, stipulations of the parties, documentary evidence submitted to the hearing officer (if the hearing consisted of written submissions), or matters that may be officially noticed. The opposing party shall respond within ten (10) days after receipt of a brief and proposed findings of fact or conclusions of law from the appealing party. Neither party may introduce new evidence on appeal to the board. Each party shall provide a copy of its brief to the other party when it submits its brief to the board.

(c) The initial decision of the hearing officer assessing liabilities or limiting, suspending, or terminating participation does not take effect pending the appeal.

(d) The board reviews the hearing officer's initial decision and issues a final decision. The board shall adopt the initial decision unless it is clearly unsupported by the evidence presented at the hearing. The board considers only evidence introduced into the record at the hearing, facts agreed to by the parties, documents submitted to the hearing officer (if the hearing consisted of only written submissions), and matters that may be officially noticed. The board's final decision may affirm, modify or reverse the hearing officer's initial decision and shall include a statement of the reasons for the decision.

(e) An assessment of liabilities becomes binding and a limitation, suspension or termination takes effect upon the date on which notice of the final decision of the board is mailed to the participant.

Section 14. Removal of Limitation.

(1) A participating institution or a participating lender whose participation in any or all authority programs has been limited after participation may not apply for removal of the limitation before the expiration of twelve (12) months from the effective date of the limitation.

(2) After the minimum limitation period, the participant may request removal of the limitation in writing and show that the deficiency on which the limitation was based has been corrected.

(3) No later than sixty (60) days after the receipt of the request, the delegated officer shall respond to the participant by granting its request, denying its request, or granting the request subject to other limitations.

(4) If the delegated officer denies the request or establishes other limitations, the participant may request a review in accordance with Section 10 of this administrative regulation and be given an opportunity to show cause why its participation should be fully reinstated.

(5) The participant's request for a review shall not waive its right to participate in any or all authority programs if it complies with the continuing limitation(s) pending the outcome of the review.

Section 15. Reinstatement After Termination.

(1) An eligible institution or an eligible lender whose participation in any or all of the authority programs has been terminated may file a request for reinstatement as a participating institution or a participating lender.

(2) Except for an institution or lender whose participation has been terminated for engaging in substantial misrepresentation, a request for reinstatement may not be made before the expiration of eighteen (18) months after the effective date of the termination.

(3) An institution or lender whose participation was terminated because the institution or lender engaged in substantial misrepresentation may not request reinstatement before the expiration of three (3) months after the effective date of the termination.

(4) An institution or lender seeking reinstatement shall:

(a) Demonstrate to the authority's satisfaction that it has corrected the deficiencies on which its termination was based, including payment in full to the authority or to other designated recipients of funds that the institution or lender has improperly received, withheld, disbursed or caused to be disbursed;

(b) Meet all the requirements for initial approval of participation; and

(5) The board or its delegated officer, within sixty (60) days of receiving the reinstatement request, shall grant the request, deny the request, or grant the request subject to limitations. A denial of the request under this section shall be deemed to be a determination of disapproval under Section 3 of this administrative regulation.

Section 16. Report to Secretary. When a decision to limit, suspend or terminate the participation of a participating institution or a participating lender becomes final in accordance with Section 13 of this administrative regulation, and the decision effects participation in the authority's insured student loan program, the delegated officer initiating the action shall report the action to the secretary for review pursuant to Section 432(h)(2) and (3) of the federal act.

Section 17. If any period of time prescribed by this administrative regulation differs from the corresponding period of time prescribed in 11 KAR 3:060, the shorter period of time shall be controlling.

History

RELATES TO: KRS 164.746(6), 164.748(13), (14), 34 C.F.R. 682.401(b)(10)(i)(C), 20 U.S.C. 1078(b)(1)(T), (U), 1082(h)(2), (3)
STATUTORY AUTHORITY: KRS 164.748(4), 34 C.F.R. 682.401(b)(10)(i)(C), 20 U.S.C. 1078(b)(1)(T), (U)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.748(5) and (6) authorize the authority to enter into contracts with eligible educational institutions and lenders to provide for administration of student financial assistance programs and KRS 164.748(13) authorizes the authority to take emergency action, disapprove, limit, suspend or terminate participation. KRS 164.746(6) requires the board to adopt administrative regulations in connection with administration of the authority's programs. Federal statutes, 20 U.S.C. 1078(b)(1)(T) and (U), and regulations, 34 C.F.R. 682.401(b)(10)(i)(C), governing the authority's insured student loan program, require the authority to establish, disseminate, and enforce criteria, rules, or administrative regulations which are substantially the same as administrative regulations with respect to emergency action, limitation, suspension, or termination issued by the secretary. This administrative regulation establishes the ministerial functions of authority officers and the conditions and procedures under which the authority or its delegated officers may initiate action to assess liabilities, withhold funds under emergency action, or disapprove, limit, suspend or terminate the participation of eligible educational institutions or eligible lenders in any of the student financial assistance programs administered by the authority.
History: 2 Ky.R. 268; eff. 2-4-1976; 5 Ky.R. 240; eff. 11-1-1978; 19 Ky.R. 428; 921; eff. 12-9-1992; 31 Ky.R. 129; eff. 9-13-2004; TAm eff. 4-27-2016; Crt eff. 9-28-2018; Cert eff. 2-19-2025.

11 KAR 4:030 Student appeals process {#sec-11-kar-4-030 omnilex-key=us-ky-regs-official--title-11--11 KAR 4:030}

Section 1. Definitions.

(1) "Adverse action" shall mean any of the following actions or decisions by an employee or agent of the authority that adversely affects the rights, obligations, or benefits of a petitioner:

(a) Denial of an award of student financial assistance;

(b) Reduction or revocation of an award of student financial assistance;

(c) Determination of the existence and amount of a repayment obligation or eligibility for cancellation or deferment of a repayment obligation authorized by statute or administrative regulation on a debt to the authority;

(d) Determination of default or acceleration of repayment of a debt to the authority;

(e) Accuracy of credit information;

(f) Establishment of reasonable and affordable payment terms for rehabilitation of a defaulted insured student loan or reinstatement of eligibility for additional student assistance, including consolidation of defaulted insured student loans, after payment of a claim due to default on an insured student loan;

(g) Denial of rehabilitation of a defaulted insured student loan or reinstatement of eligibility for additional student assistance, including consolidation of defaulted insured student loans, after payment of an insurance claim by the authority due to default on an insured student loan or nonpayment of any debt to the authority.

(2) The definition of "authority" is governed by KRS 164.740(1).

(3) "Default" means the failure of a borrower to make an installment payment when due, or to meet other terms of a promissory note under circumstances where the authority finds it reasonable to conclude that the borrower no longer intends to honor the obligation to repay.

(4) "Petitioner" means an applicant for or recipient of student financial assistance administered by the authority or a person, including an endorser, indebted to the authority for financial assistance who has been affected by an adverse action or decision by the authority.

(5) The definition of "endorser" is governed by KRS 164.740(7).

(6) The definition of "insured student loan" is governed by KRS 164.740(11).

(7) "Record" means all of the documentation filed by the petitioner and all of the information considered by the delegated employee of the authority in ruling on a request for review pursuant to Section 4(1) of this administrative regulation.

(8) "Request for clarification" is the first communication, written or oral, from a petitioner for explanation of an adverse action by the authority.

(9) "Request for review" is a petitioner's communication challenging the authority's basis for the adverse action.

Section 2. Scope of Administrative Regulation. The procedures prescribed in this administrative regulation shall not apply to:

(1) The setoff of an individual's tax refund or any payment by the U.S. Treasury or by the Commonwealth for payment of a debt owed to the authority in accordance with 11 KAR 4:050, except to the extent specified in that administrative regulation;

(2) The issuance of an administrative order of wage garnishment by the authority for recovery of a defaulted insured student loan pursuant to 11 KAR 3:100;

(3) Any matter pending adjudication by a court or that has previously been adjudicated by a court, except that a petitioner shall exhaust all administrative remedies prior to commencement of an action in court;

(4) The dischargeability of a debt to the authority in bankruptcy;

(5) Denial of an award of financial assistance due to lack of funds authorized for that purpose;

(6) Denial of a grant due to the petitioner's failure to notify the authority of a change of educational institution by a deadline established in administrative regulations.

Section 3. Request for Clarification. A petitioner may, upon any adverse action by the authority, request from the authority, at any time following notification of the adverse action, a concise statement of the basis for the action including citation of statutory or regulatory authority for the adverse action. The authority's delegated employee, within twenty (20) working days of receipt of the request for clarification, shall respond in writing to a written request for clarification and notify the petitioner of his right to request a review of the adverse action. If the petitioner makes an oral inquiry at any time, the authority shall not be required to respond in writing. The authority shall not be required to suspend any activities it has undertaken or, in the ordinary course of the administration of its programs, may subsequently undertake related to the adverse action. The authority shall take reasonable steps to informally resolve any discrepancy in the petitioner's record identified by the oral or written request for clarification. If the delegated employee responding to the request for clarification believes that the information available to the authority indicates a discrepancy and warrants steps to resolve the dispute, activities related to the adverse action may be suspended at the discretion of the delegated employee.

Section 4. Request for Review.

(1) Initial administrative review.

(a) If the applicability of statutes or administrative regulations to the adverse action or the factual accuracy of information contained in the authority's notification of adverse action or the response to a request for clarification pursuant to Section 3 of this administrative regulation, he may request in writing a review of the adverse action and any response to a request for clarification. This request for an initial administrative review of the adverse action may be submitted at any time, but shall not result in a suspension of any action by the authority pertaining to the petitioner during the review, except that the authority shall not report information to a credit bureau or assess collection costs during the review on an insured student loan if the petitioner submits a written request for an initial administrative review with relevant documentation attached within sixty (60) days of the date that the authority sends a notice of default by the petitioner on an insured student loan upon payment by the authority of an insurance claim to the holder of the insured student loan. If the delegated employee conducting the initial administrative review believes that the information available to the authority indicates a discrepancy and warrants steps to resolve the dispute, activities related to the adverse action may be suspended at the discretion of the delegated employee.

(b) The request for initial administrative review of the adverse action shall specify the factual basis on which the adverse action is disputed and any legal or equitable defense the petitioner may have against recovery of a debt to the authority. The petitioner shall submit with the request for review all documentation the petitioner believes supports his position and shall submit any additional documentation that the authority may deem relevant and require. The petitioner may supplement the written request for review and the documentation within ten (10) working days of the date the request is received by the authority. The authority shall not be required to consider a request for review that is not in writing or is not supplemented by supporting documentation that has been requested in writing by the authority.

(c) The authority's delegated employee conducting the review shall consider any documentation submitted by the petitioner, any documentation of the authority, and information from any other source that the delegated employee may deem relevant. The documentation considered shall be made available to the petitioner upon written request. Upon request of the petitioner at the time of submitting the written request for review and clarification of why the authority cannot adequately resolve the issues raised by the petitioner by review of the documentary evidence, the petitioner or any other witness called by the petitioner or the authority with relevant factual information may appear in person or by telephone to present additional facts, if the delegated employee conducting the review determines, in his discretion, that the issues to be resolved require a determination of credibility or veracity. The petitioner's request to appear in person or by telephone shall include identification of any other individuals that the petitioner wishes to have testify, identification of the specific issues regarding which the individuals are prepared to provide additional information, and an explanation of the reasons why each individual's testimony is necessary to resolve the issues. The documentation considered and the delegated employee's summary of any in-person or telephonic testimony shall constitute the entire record of the administrative review, and shall be deemed conclusive as to all issues in dispute.

(d) The delegated employee conducting the review shall notify the petitioner in writing of the results of the administrative review, stating the essential facts and the applicable laws and administrative regulations upon which the conclusion is based. The notice shall also indicate that the record of the administrative review and the written conclusions by the delegated employee shall be provided to the executive director or his designee for a redetermination upon request of the petitioner.

(2) Review by executive director.

(a) A review by the executive director or his designee of the results of the initial administrative review shall consider the record of the initial administrative review; applicable laws, administrative regulations, and any federal directives; and any consultation with authority personnel that he may deem necessary. A request for review by the executive director shall not result in a suspension of any action by the authority pertaining to the petitioner during the review, except that if the executive director or his designee conducting the review believes that the information available to the authority warrants steps to resolve the dispute, activities related to the adverse action may be suspended at the discretion of the executive director or his designee. If the findings warrant, the executive director or his designee may uphold the adverse action or result of the request for review or may reverse or modify the adverse action or the result of the request for review in whole or in part. The executive director or his designee may, at any time, negotiate a mutually agreeable resolution of the dispute if in his discretion, the circumstances warrant a settlement.

(b) Time frame. The review by the executive director shall be requested in writing within thirty (30) days of the date of the notice described in subsection (1)(d) of this section.

(c) Notice. The written decision of the executive director or his designee shall be sent to the petitioner, with a notice that shall inform the petitioner of the right to request a hearing pursuant to KRS Chapter 13B within thirty (30) days on all issues raised by the petitioner in the request for review. Service of the notice of the decision shall be conclusively presumed to be effected five (5) days after mailing of the notice by the authority, if sent by U.S. first class mail, unless the notice is returned to the authority undelivered by the postal service. The date of service of the notice may otherwise be evidenced by affidavit of an individual executing personal service or a postal delivery receipt.

Section 5. Request for Hearing.

(1)

(a) If an adverse action is upheld by the executive director or his designee, the petitioner may request a hearing pursuant to KRS Chapter 13B. A request for a hearing shall not result in a suspension of any action by the authority pertaining to the petitioner.

(b) The request for a hearing shall be served on the authority within thirty (30) days after receipt of notice of the executive director's decision.

(2) Upon receipt of a timely request for a hearing, the authority shall, in accordance with the procedures prescribed in KRS Chapter 13B, arrange for a hearing before a hearing officer appointed by the authority. The hearing officer, following submission of the report described in subsection (3)(b) of this section, shall establish a schedule for any discovery, prehearing conferences, and the time and place of the hearing. The place of the hearing shall be in Franklin County, unless another location is agreed on by the parties.

(3)

(a) Not more than fifteen (15) days following service upon the authority of the request for a hearing, the parties shall confer and jointly stipulate the issues to be resolved by the hearing officer, discuss the possibility of informal resolution of the dispute, develop a proposed discovery plan, exchange or arrange for the exchange of a list of the names, addresses, and phone numbers of any witnesses expected to testify at the hearing and a brief summary of the testimony of each witness that the party expects to introduce into evidence, and agree to possible dates for a prehearing conference and the hearing.

(b) The authority shall report to the hearing officer the results of the discussions between the parties described in paragraph (a) of this subsection.

(c) Upon the request of either party, at any time, the hearing officer may issue a subpoena for the production of documents or the attendance of witnesses. Either party may depose witnesses, upon reasonable notice to the witness and the opposing party, without leave of the hearing officer, except that attendance of witnesses that are not parties to the hearing may be compelled by subpoena issued by the hearing officer, either party may, without leave of the hearing officer, submit interrogatories and request for admissions to the opposing party. The party receiving the interrogatories or request for admissions shall respond within twenty (20) days, or upon such shorter or longer time as the hearing officer may allow. Each matter of which an admission is requested shall be deemed admitted unless, within twenty (20) days after service of the request, or upon such shorter or longer time as the hearing officer may allow, the party to whom the request is directed serves upon the party requesting the admission a written answer or objection addressed to the matter.

(4) At the hearing, the record of the administrative review, described in Section 4(1) of this administrative regulation, and the decision of the executive director or his designee, described in Section 4(2) of this administrative regulation, shall be submitted to the hearing officer and the taking of proof shall commence first with the presentation of evidence by the petitioner and then by the authority, with opportunities for cross-examination, rebuttal, and closing statements.

Section 6. Final Order of Board. The board shall review the hearing officer's recommended order and the record of the hearing at the next regularly scheduled meeting of the board, unless a special meeting is necessary for this purpose to render a final order within the time required by KRS 13B.120. The board shall adopt the hearing officer's recommended order unless it is clearly unsupported by the evidence presented at the hearing and the applicable law. The board shall only consider the record adduced at the hearing, including all documents, briefs, and transcripts of the hearing, as well as the evidence presented at the hearing, but may, at the discretion of the board's chairman, permit counsel for the petitioner and the authority, or the petitioner if not represented by counsel, to submit briefs and make oral arguments pertaining to the issues addressed in the hearing officer's recommended order.

History

RELATES TO: KRS 164.748(14)
STATUTORY AUTHORITY: KRS 13B.070(3), 13B.170, 164.748(4)
NECESSITY, FUNCTION, AND CONFORMITY: The Kentucky Higher Education Assistance Authority administers programs to provide financial assistance to students to attend postsecondary institutions. This administrative regulation sets forth the procedures by which students seeking financial assistance or individuals indebted to the authority for repayment of student financial assistance may request a review of decisions made by the authority's employees which adversely affect their rights, obligations or benefits or their eligibility to participate in authority administered programs. This amendment is necessary to clarify hearing procedures and the applicability of this administrative regulation to certain disputes that may arise.
History: 5 Ky.R. 279; eff. 11-1-1978; 6 Ky.R. 680; eff. 8-6-1980; 21 Ky.R. 445; eff. 10-6-1994; 23 Ky.R. 3066; eff. 4-14-1997; TAm eff. 4-27-2016; Crt eff. 9-28-2018; TAm eff. 4-2-2021; Cert eff. 2-19-2025.

11 KAR 4:040 Educational institution participation requirements {#sec-11-kar-4-040 omnilex-key=us-ky-regs-official--title-11--11 KAR 4:040}

Section 1. Definitions.

(1) "Applicable federal loans" means loans that:

(a) Are either:

Federal Stafford loans or federal SLS loans, which are loans reinsured by the secretary pursuant to 20 U.S.C. 1078 or 1078-8; or
The portion of a loan made under the Federal Consolidation Loan Program that is used to repay a federal Stafford loan or federal SLS loan; and

(b) Are received for attendance at an institution.

(2) "Authority" is defined by KRS 164.740(1).

(3) "Eligible institution" is defined in KRS 164.740(4).

(4) "Eligible program of study" is defined by:

(a) KRS 164.769(2)(b) for purposes of Section 8 of this administrative regulation; and

(b) 11 KAR 5:001, Section 1 (10), for purposes of Sections 6 and 9 of this administrative regulation.

(5) "Federal act" is defined by KRS 164.740(8).

(6) "Fiscal year" means the period from and including October 1 of the calendar year through and including September 30 of the following calendar year.

(7) "Fiscal year default rate" means:

(a) For a fiscal year in which thirty (30) or more current and former students at the institution enter repayment on applicable federal loans, the percentage of those current and former students who enter repayment on the loans received for attendance at that institution in that fiscal year who default before the end of the following fiscal year as determined by the secretary pursuant to 20 U.S.C. 1085; or

(b) For a fiscal year in which less than thirty (30) of the institution's current and former students enter repayment on applicable federal loans, the percentage of those current and former students who entered repayment on applicable federal loans in any of the three (3) most recent fiscal years, who default before the end of the fiscal year immediately following the year in which they entered repayment.

(8) "Insured student loan" is defined by KRS 164.740(11).

(9) "Secretary" is defined by KRS 164.740(20).

Section 2. General Rule.

(1) The authority shall execute an administrative agreement with any educational institution which:

(a) Meets the applicable eligibility criteria established by KRS 164.740 through 164.7891 and the federal act, if applicable; and

(b) is approved for participation by the authority and, if applicable, the secretary.

(2) The authority shall approve for participation in any authority program an eligible institution which:

(a) Is certified by the secretary to participate in programs of student financial assistance authorized by the federal act, and has in force, if required by the secretary, a participation agreement with the secretary to participate in any of those programs;

(b) Is not presently suspended or terminated from participation in student financial assistance programs by either the authority, an organization authorized to insure loans under the federal act, or the secretary;

(c) Meets the criteria set forth in Sections 4 through 10 of this administrative regulation, as applicable to the particular authority program in which the educational institution seeks participation; and

(d) Has been in continuous operation for at least two (2) years, unless otherwise required by the federal act.

Section 3. Maintenance of Participation.

(1) Except as provided in 11 KAR 4:020, an administrative agreement shall remain in effect:

(a) In accordance with subsection (2) of this section and the terms of the agreement; and

(b) As long as the educational institution conforms to the criteria established in Section 2 of this administrative regulation.

(2) If participation by an institution is suspended or terminated from student financial assistance programs pursuant to 11 KAR 4:020, the authority may determine that the administrative agreement shall remain in force for one (1) or more specified programs if the authority determines there is good cause for the exception.

(3) The authority may periodically reevaluate the status of the institution with respect to the criteria established in this administrative regulation.

Section 4. Documentation of Federal Eligibility.

(1) The institution shall demonstrate to the authority that it is approved by the secretary to participate, and holds all necessary licenses to offer academic programs by submitting to the authority a true and complete copy of the most recent federal application for institutional eligibility, eligibility letter, and program participation agreement executed by the secretary.

(2) The authority may disapprove, limit, suspend, or terminate the participation of an institution upon failure to submit the required documentation within forty-five (45) days following request by the authority.

Section 5. Insured Student Loan Program Participation. In order to participate in the authority's insured student loan program, the educational institution shall:

(1) Be certified by the secretary to participate and have in force, if required by the secretary, a participation agreement with the secretary; and

(2) Execute an administrative agreement with the authority. The authority may permit an educational institution, otherwise approved, to participate without an agreement if:

(a) The institution's fiscal year default rate is twenty (20) percent or less; or

(b) The volume of loans insured by the authority for students attending that institution in any fiscal year does not exceed $50,000.

Section 6. Kentucky Tuition Grant Program Participation. In order to participate in the authority's KTG program, an educational institution shall:

(1) Qualify as a private, independent college or university, which is accredited by a regional accrediting association recognized by the U.S. Department of Education;

(2) Be located within the Commonwealth of Kentucky;

(3) Offer an eligible program of study, which is not comprised solely of sectarian instruction; and

(4) Execute an administrative agreement with the authority.

Section 7. KHEAA Work Study Program Participation. In order to participate in the authority's KHEAA work study program, an educational institution shall:

(1) Qualify as an eligible institution;

(2) Be located within the Commonwealth of Kentucky;

(3) Offer a program of study not comprised solely of sectarian instruction; and

(4) Execute an administrative agreement with the authority.

Section 8. Teacher Scholarship Participation. In order to participate in the authority's teacher scholarship program, an educational institution shall:

(1) Qualify as a an eligible institution;

(2) Be located within the Commonwealth of Kentucky;

(3) Offer an eligible program of study; and

(4) Execute an administrative agreement with the authority.

Section 9. College Access Program Participation. In order to participate in the authority's college access program, an educational institution shall:

(1) Qualify as a an eligible institution;

(2) Be located within the Commonwealth of Kentucky;

(3) Offer an eligible program of study; and

(4) Execute an administrative agreement with the authority.

Section 10. The authority may execute an administrative agreement with an educational institution which may include nonmain campuses of the institution that are not separately incorporated.

History

RELATES TO: KRS 164.740, 164.748(6), (13), 20 U.S.C. 1078, 1078-8, 1085, 34 C.F.R. Part 668 subparts A, B, D, E, F
STATUTORY AUTHORITY: KRS 164.748(4)
NECESSITY, FUNCTION, AND CONFORMITY: The Kentucky Higher Education Assistance Authority administers programs of student financial assistance. KRS 164.748(6) and (13) requires the authority to enter into contracts with eligible educational institutions to provide for the administration of student financial assistance programs, and approve, disapprove, limit, suspend, or terminate the participation of the institutions. This administrative regulation establishes the conditions under which the authority shall execute a contract with an institution for participation in the authority's programs.
History: 11 Ky.R. 507; eff. 10-9-1984; 18 Ky.R. 320; 1056; eff. 11-8-1991; 22 Ky.R. 97; 584; eff. 9-7-1995; 30 Ky.R. 662; 1454; eff. 1-5-2004; 31 Ky.R. 573; 921; eff. 11-8-2004; TAm eff. 4-27-2016; Crt eff. 9-28-2018.

11 KAR 4:050 Set off of authority claims {#sec-11-kar-4-050 omnilex-key=us-ky-regs-official--title-11--11 KAR 4:050}

Section 1. Federal Payment Setoff.

(1) Notification.

(a) The authority shall, not less than sixty-five (65) days prior to submitting the claim to the federal government for setoff, send written notification by U.S. First Class Mail to the last known address of a person against whom the authority has a claim of indebtedness to the authority for a sum certain for which setoff is sought pursuant to 31 USC 3718.

(b) The notification shall contain information sufficient to identify the person and to inform the person of the amount of the claim to be set off, the authority's intention to set off the claim, and the right to dispute the claim. The notification may contain additional information as the authority may prescribe.

(2) Objection.

(a) A person notified pursuant to subsection (1) of this section may submit to the authority a written objection to the setoff of federal payments to repay the claim of the authority. This written objection shall specify the basis on which the authority's claim is disputed, including all legal and equitable defenses the petitioner may have against recovery by the authority. The petitioner may supplement the written statement of appeal prior to a final determination with additional documentation. The petitioner shall submit additional documentation as the authority may require based upon the particular facts alleged in the petitioner's statement of appeal.

(b) The authority, or its designated representative, shall make a final written determination of the validity of the claim and refrain from submitting the claim to the federal government pending the final determination if:

The person objects to the setoff of federal payments to repay the claim of the authority within sixty-five (65) calendar days of the date the notification required by subsection (1) of this section is sent; or
The person submits a written request to inspect records to the authority within twenty (20) days of the date of the notification described in subsection (1) of this section and subsequently submits a written objection to the authority not later than fifteen (15) days after the date the authority mails copies of the requested documents to the petitioner.

(c) The authority, or its designated representative, shall not consider as a defense a question of law or fact that has previously been adjudicated by a court of competent jurisdiction or that was previously raised in an administrative proceeding before the authority pursuant to 11 KAR 4:030 pertaining to the existence, amount, or the person's liability on the particular debt in question or the terms of a prior repayment schedule, except if the petitioner demonstrates that:

Circumstances have changed or new information is available; or
The prior decision:

a. Substantially disregarded or ignored the defense; or

b. Was arbitrary, capricious, not supported by the facts or made through fraud.

(d)

The final determination of the authority shall be based on documentation submitted by the petitioner, other records relevant to the loan obligation received from another source, and relevant records of the authority, which shall be made available to the petitioner upon request, except that the petitioner may appear in person or by telephone to present additional facts upon request by the petitioner and explanation of why the authority cannot adequately resolve the issues raised by the petitioner by review of the documentary evidence.
The petitioner's request to appear in person or by telephone shall include identification of all persons that the petitioner wishes to have testify, identification of the specific issues regarding which each person is prepared to testify, and an explanation of the reasons why each person's testimony is necessary to resolve the issues.
The authority shall grant the petitioner's request to appear in person or by telephone if the authority determines, in its discretion, that the issues to be resolved require a determination of credibility or veracity.
Documentation considered by the authority and the record of an in-person or telephonic testimony shall constitute the record of the appeal.
The authority's decision shall be written and sent to the petitioner at his last known address. If the decision is adverse to the petitioner, the decision shall state the facts on which the decision is based, any applicable statutes or administrative regulations, the conclusion underlying the decision, and the amount of the authority's claim to be set off against federal payments owed to the petitioner.

(e) Review of final determination of the authority.

If the petitioner disagrees with the final, written determination of the authority, the petitioner may submit a written request for review of the decision by the Secretary of the U.S. Department of Education.
The authority, or its designated representative, shall refrain from referring the authority's claim to the federal government, if the request for review by the Secretary of the U.S. Department of Education is submitted to the authority and received by the authority within thirty (30) calendar days after the date the authority's final written determination is rendered and mailed to the petitioner.

(3) If a person notified pursuant to subsection (1) of this section does not submit an objection within the time specified in subsection (2)(b) of this section or, upon a final determination upholding, in part or in whole, the claim of the authority, the petitioner does not submit a request for review of the authority's final determination within the time specified in subsection (2)(e) of this section, the claim shall be referred by the authority to the federal government in accordance with 31 USC 3718 and 34 CFR 30.33(a).

(4) Voluntary repayment. A person notified pursuant to subsection (1) of this section may agree to repay the debt to the authority on terms satisfactory to the authority.

(a) The authority, or its designated representative, shall refrain from referring the authority's claim to the federal government, if:

The person owing the debt:

a. Agrees to make monthly payments; and

b. Submits the first payment to the authority; and

The payment is received by the authority not later than:

a. The 65th calendar day following the date the notification required by subsection (1) of this section is sent;

b. The seventh calendar day after the date the authority's final written determination is rendered and mailed to the petitioner; or

c. The 15th calendar day after documents are mailed to the person owing the debt by the authority if the person requests to inspect documents within twenty (20) calendar days following the date the notification required by subsection (1) of this section is sent.

(b) For purposes of paragraph (a) of this subsection, the authority shall require that payments be received monthly on a timely basis and a down payment of the lesser of the outstanding balance of the debt or $250. The monthly payment amount acceptable to the authority shall be based upon the balance owed and at least equal the monthly accrual of interest on the debt, except that the monthly payment amount may be less than the monthly accrual of interest on the debt based upon consideration of the petitioner's and the petitioner's spouse's disposable income and reasonable and necessary expenses including housing, utilities, food, medical costs, work-related expenses, dependent care costs, and other student loan repayments.

(c)

After the authority has referred a claim to the federal government for setoff against a federal payment owed to the person owing the debt, an amount previously set off shall not be refunded.
The authority's claim for setoff shall be withdrawn if the person owing the debt or another person on behalf of the debtor agrees to make monthly payments acceptable to the authority, submits six (6) consecutive, timely payments as agreed, and requests the authority to withdraw the claim for setoff.
The monthly payment amount acceptable to the authority shall be based upon the balance owed and at least equal the monthly accrual of interest on the debt, except that the monthly payment amount may be less than the monthly accrual of interest on the debt based upon consideration of the petitioner's and the petitioner's spouse's disposable income and reasonable and necessary expenses including housing, utilities, food, medical costs, work-related expenses, dependent care costs, and other student loan repayments.

(d) In support of a monthly payment amount less than the monthly accrual of interest, the petitioner shall submit to the authority:

Evidence of current income;
Evidence of current expenses; and
A statement of the unpaid balance on all other student loan debt.

(e) If a person establishes a repayment schedule in accordance with this subsection and subsequently fails to submit consecutive, timely payments, a subsequent repayment schedule established for the purpose of paragraphs (a) or (c) of this subsection shall require an initial payment of the lesser of the outstanding balance of the debt or $500 plus ten (10) percent of the outstanding balance that exceeds $1,000.

Section 2.

(1) State income tax refund setoff.

(a) Notification.

The authority shall, not less than thirty (30) days prior to submitting the claim to the Kentucky Revenue Cabinet for setoff, send written notification by U.S. First Class Mail to the last known address of a person against whom the authority has a claim of indebtedness to the authority for a sum certain for which setoff is sought pursuant to KRS 131.560.
The notification shall contain sufficient information to identify the person and to inform the person of the amount of the claim to be set off, the authority's intention to set off the claim pursuant to KRS 131.560, and the right to dispute the claim. The notification may contain additional information as the authority may prescribe.

(b) Objection.

A person notified by the authority pursuant to paragraph (a) of this subsection or notified by the Kentucky Revenue Cabinet pursuant to KRS 131.570(1) may petition the authority for an administrative review and a hearing in accordance with 11 KAR 4:030, Sections 4 and 5.
The authority, or its designated representative, shall refrain from referring the authority's claim to the Kentucky Revenue Cabinet, if the request for administrative review is submitted to the authority and received by the authority within thirty (30) calendar days after the date the notice required by paragraph (a) of this subsection is sent.

(2) Setoff of amounts due from the State Treasurer pursuant to KRS 44.030.

(a) Notification.

The authority shall, not less than fifteen (15) calendar days prior to submitting the claim to the Kentucky State Treasurer for setoff, send written notification by U.S. First Class Mail to the last known address of a person against whom the authority has a claim of indebtedness to the authority for a sum certain for which setoff is sought pursuant to KRS 44.030.
The notification shall contain sufficient information to identify the person and to inform the person of the amount of the claim to be set off, the authority's intention to set off the claim pursuant to KRS 44.030, and the right to dispute the claim. The notification may contain additional information as the authority may prescribe.

(b) Objection.

A person notified by the authority that an amount due from the State Treasurer may be withheld pursuant to KRS 44.030 may petition the authority for a hearing in accordance with 11 KAR 4:030, Section 5.
The authority, or its designated representative, shall refrain from referring the authority's claim to the Kentucky State Treasurer, if the request for administrative review is submitted to the authority and received by the authority within fifteen (15) calendar days after the date the notice required by paragraph (a) of this subsection is sent.

(3) Defenses.

(a) Except as provided in paragraph (b) of this subsection, a debtor may assert a legal or equitable defense to a claim by the authority for setoff pursuant to subsections (1) and (2) of this section pertaining to the existence, amount or the person's liability on the particular debt in question or the terms of a prior repayment schedule.

(b) The designated authority representative conducting an administrative review in accordance with 11 KAR 4:030, Section 4, or the hearing officer conducting a hearing pursuant to 11 KAR 4:030, Section 5, shall not consider as a defense a question of law or fact that has previously been adjudicated by a court of competent jurisdiction or that was previously raised in an administrative proceeding before the authority pursuant to 11 KAR 4:030 pertaining to the existence, amount, or the person's liability on the particular debt in question or the terms of a prior repayment schedule, except if the petitioner demonstrates that:

Circumstances have changed or new information is available; or
The prior decision:

a. Substantially disregarded or ignored the defense; or

b. Was arbitrary, capricious, not supported by the facts or made through fraud.

History

RELATES TO: KRS 44.030, 131.565, 164.748(10), (14), (19)
STATUTORY AUTHORITY: KRS 13B.170, 164.748(4), 34 C.F.R. 30.33, 31 U.S.C. 3718, 3720A
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.748(10) and (14) authorize the authority to collect student loans from individual borrowers and to perform acts that are necessary or appropriate to carry out the purposes of the authority. KRS 131.565 and 31 USC 3720A provide that the authority may enter agreements with the Kentucky Revenue Cabinet and with the federal government to provide for the withholding of income tax refunds owed to individuals indebted to the authority to satisfy claims established by the authority. In accordance with KRS 44.030, the authority may submit a claim to the State Treasurer to withhold an amount due to an individual from the treasury against a claim of the authority. This administrative regulation establishes the process for notification and appeal afforded to an individual in implementing a set off of an authority claim through the Kentucky Revenue Cabinet, the State Treasurer, or the federal government.
History: 11 Ky.R. 1528; eff. 5-14-1985; 12 Ky.R. 659; 1227; eff. 1-3-1986; 21 Ky.R. 1907; eff. 4-6-1995; 25 Ky.R. 385; 806; eff. 10-1-1998; Crt eff. 9-28-2018; Crt eff. 2-19-2025.

11 KAR 4:060 Distribution of publications {#sec-11-kar-4-060 omnilex-key=us-ky-regs-official--title-11--11 KAR 4:060}

Section 1. Definitions. The definition of "authority" is governed by KRS 164.740(1).

Section 2. Free Distribution.

(1) The authority may distribute to the following Kentucky organizations multiple copies of its publications, free of charge, allotted among the organizations, at the authority's sole discretion, on the basis of funds budgeted for printing the publications:

(a) High schools;

(b) Public and private nonprofit libraries;

(c) Kentucky postsecondary educational institutions participating in authority administered student financial assistance programs;

(d) Public and private nonprofit organizations involved in assisting individuals with postsecondary educational planning.

(2) The authority may provide one (1) free copy to individuals and organizations not specified in subsection (1) of this section, subject to availability.

Section 3. Costs and Fees Charged.

(1) The authority may charge a fee for providing multiple copies of certain publications: "Getting In," "Affording Higher Education," and Success Through Educational Planning (STEP) materials as provided in subsections (2) and (3) of this section.

(2) If the authority determines a need to print additional copies of any publication specified in subsection (1) of this section based upon requests that exceed the number allotted for one (1) or more organizations specified in Section 2(1) of this administrative regulation, then all costs associated with the additional copies printed to accommodate the organization's request will be charged to that organization.

(3) The authority may charge a fee for each additional copy of publications requested by individuals and organizations specified in Section 2(2) of this administrative regulation.

Section 4. Establishment of Fees. Fees for publications shall be established by the authority annually, based on the unit cost (rounded up to the nearest whole dollar) of the publications to the budget unit calculated on the following formula: the personnel and operating costs allocated to publication development plus the direct printing cost for all copies divided by the total number of copies printed plus the cost of shipping (actual postage and envelope cost) and handling (fifteen (15) minute preparation time by lowest paid employee in the area).

Section 5. Reproduction. Copyrighted publications of the authority may be reproduced with the written permission of the authority.

History

RELATES TO: KRS 45.253(5), 164.748(11)
STATUTORY AUTHORITY: KRS 13A.100(3), 164.748(4)
NECESSITY, FUNCTION, AND CONFORMITY: The Kentucky Higher Education Assistance Authority develops, publishes, and distributes certain publications containing financial aid and postsecondary education information. This administrative regulation sets forth the conditions and procedures under which the authority will distribute, determine costs and charge fees for, and limit reproduction of these publications.
History: 19 Ky.R. 531; eff. 10-1-1992; Crt eff. 9-28-2018; Crt eff. 2-19-2025.

11 KAR 4:080 Student aid applications {#sec-11-kar-4-080 omnilex-key=us-ky-regs-official--title-11--11 KAR 4:080}

Section 1. Applications. To participate in a specified grant, scholarship, or work-study program administered by the Kentucky Higher Education Assistance Authority, the following application forms shall be completed for the appropriate academic year in which an award is sought in accordance with their instructions:

(1) For the KHEAA Grant Program established in 11 KAR 5:130, the Free Application for Federal Student Aid (FAFSA);

(2) For the Teacher Scholarship Program established in 11 KAR 8:030, the Teacher Scholarship Application;

(3) For the Early Childhood Development Scholarship Program established in 11 KAR 16:010:

(a) The Free Application for Federal Student Aid (FAFSA); and

(b) The Early Childhood Development Scholarship Application;

(4) For the Coal County Scholarship Program for Pharmacy Students established in 11 KAR 19:010, the Coal County Scholarship Program for Pharmacy Students Application;

(5) For the Optometry Scholarship Program established in KRS 164.7870, the Optometry Scholarship Application;

(6) For the Dual Credit Scholarship Program established in KRS 164.786, the Dual Credit Scholarship Application; and

(7) For the Work Ready Kentucky Scholarship Program established in KRS 164.787:

(a) The Free Application for Federal Student Aid (FAFSA); and

(b) The Work Ready Kentucky Scholarship Application.

Section 2. Incorporation by Reference.

(1) The following material is incorporated by reference:

(a) "Free Application for Federal Student Aid July 1, 2024 - June 30, 2025", (FAFSA), December 2023;

(b) "Free Application for Federal Student Aid July 1, 2023 - June 20, 2024", (FAFSA), October 2022;

(d) "Early Childhood Development Scholarship Application", April 2006;

(e) "Coal County Scholarship Program for Pharmacy Students Application", February 2011;

(f) "Kentucky Coal County College Completion Scholarship Application", October 2014;

(g) "Optometry Scholarship Application", January 2022;

(h) "Dual Credit Scholarship Application", 2024 - 2025; and

(i) "Work Ready Kentucky Scholarship Application", August 2019.

(2) This material may be inspected, copied, or obtained, subject to applicable copyright law, at the Kentucky Higher Education Assistance Authority, 100 Airport Road, Frankfort, Kentucky 40601, Monday through Friday, 8 a.m. to 4:30 p.m. The material may also be obtained at www.kheaa.com.

History

RELATES TO: KRS 164.518, 164.744(2), 164.748(4), (7), (8), 164.753(3), (4), (6), 164.7535, 164.769, 164.780, 164.785, 164.786, 164.787, 164.7870, 164.7890, 164.7894, 34 C.F.R. 654.1 - 654.5, 654.30-654.52, 20 U.S.C. 1070d-31 - 1070d-41
STATUTORY AUTHORITY: KRS 164.518(3), 164.746(6), 164.748(4), 164.753(3), (6), 164.7535, 164.769(5), (6)(f), 164.7894(6), 34 C.F.R. 654.30, 654.41, 20 U.S.C. 1070d-37, 1070d-38
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.748(4) authorizes the Authority to promulgate administrative regulations pertaining to the awarding of grants, scholarships, and honorary scholarships as established in KRS 164.740 through 164.7891. KRS 164.7894(6) requires the Authority to promulgate administrative regulations as needed for the administration of the Kentucky Coal County College Completion Program. This administrative regulation designates and incorporates the applications to be utilized under the grant, scholarship, and work-study programs administered by KHEAA.
History: 33 Ky.R. 258; 708; eff. 10-6-2006; 3224; 3589; eff. 7-6-2007; 34 Ky.R. 2322; eff. 8-1-2008; 35 Ky.R. 2314; 2315; 36 Ky.R. 13; eff. 7-13-2009; 1960; eff. 5-7-2010; 37 Ky.R. 1746; 2150; eff. 4-1-2011; 38 Ky.R. 1610; 1943; eff. 6-11-2012; 39 Ky.R. 1748; eff. 5-3-2013; 40 Ky.R. 1812; eff. 6-6-2014; 41 Ky.R. 1124; 1493; eff. 2-6-2015; 2099; eff. 7-6-2015; 42 Ky.R. 2611, eff. 7-1-2016; 43 Ky.R. 998; eff. 3-3-2017; 44 Ky.R. 1367; eff. 3-9-2018; 45 Ky.R. 1703, 2329; eff. 3-8-2019; 48 Ky.R. 2779; 49 Ky.R. 309; eff. 11-1-2022; 49 Ky.R. 309, 1330, 1741; eff. 5-30-2023; 50 Ky.R. 2238; 51 Ky.R. 483; eff. 9-17-2024.

Chapter 5 KHEAA Grant Programs

11 KAR 5:001 Definitions pertaining to 11 KAR Chapter 5 {#sec-11-kar-5-001 omnilex-key=us-ky-regs-official--title-11--11 KAR 5:001}

Section 1. Definitions.

(1) "Academic term" means the fall or spring semester or their equivalence under a trimester or quarter system at a postsecondary education institution.

(2) "Academic year" means a period of time, usually eight (8) or nine (9) months, during which a full-time student would normally be expected to complete the equivalent of two (2) semesters, two (2) trimesters, three (3) quarters, 900 clock hours, twenty-four (24) semester hours, or thirty-six (36) quarter hours of instruction.

(3) "Authority" is defined by KRS 164.740(1).

(4) "College Access Program" or "CAP" means the program of student financial assistance grants authorized under KRS 164.7535 to assist financially needy part-time and full-time undergraduate students attending an educational institution.

(5) "Correspondence course" means a home study course that:

(a) Is provided by an educational institution under which the institution provides instructional materials, including examinations on the materials, to students who are not physically attending classes at the institution; and

(b) Meets the following requirements:

When a student completes a portion of the instructional materials, the student takes the examinations that relate to that portion of the materials, and returns the examinations to the institution for grading;
The institution provides instruction through the use of video cassettes or video discs in an academic year, unless the institution also delivers the instruction on the cassette or disc to students physically attending classes at an institution during the same academic year; and
If a course is part correspondence and part residential training, the course shall be considered to be a correspondence course.

(6) "Educational expenses" means tuition and fees, books and supplies, room and board or reasonable living expenses, reasonable miscellaneous personal expenses, and reasonable transportation costs for the academic period of the grant application.

(7) "Educational institution" means a participating institution located in Kentucky which:

(a) Offers an eligible program of study;

(b) As a condition of enrollment as a regular student, requires that the person:

Have a certificate of graduation from a school providing secondary education, or the equivalent of a certificate; or

a. Be beyond the age of compulsory attendance in Kentucky; and

b. Have the ability to benefit from the training offered by the institution;

Has its headquarters or main campus in Kentucky; or
If based outside of Kentucky, offers no more than forty-nine (49) percent of the courses offered in Kentucky as online courses; and

(d)

For purposes of the College Access Program, is a public or private participating institution; or
For purposes of the Kentucky Tuition Grant Program, is a private independent college or university, accredited by a regional accrediting association recognized by the United States Department of Education, that is a participating institution whose institutional programs are not comprised solely of sectarian instruction.

(8) "Eligible institution" is defined by KRS 164.740(4).

(9) "Eligible noncitizen" means an individual who is:

(a) Either:

A U.S. national;
A U.S. permanent resident with an Alien Registration Receipt Card (1-151 or 1-551); or
A person with a Departure Record (I-94) from the U.S. Immigration and Naturalization Service showing any one (1) of the following designations:

a. "Refugee";

b. "Asylum granted";

c. "Indefinite parole" or "humanitarian parole"; or

d. "Cuban-Haitian entrant"; or

A citizen of:

a. The Freely Associated States;

b. The Federated States of Micronesia;

c. The Republic of Palau; or

d. The Republic of the Marshall Islands; and

(b) Not in the United States on a:

F1 or F2 student visa;
J1 or J2 exchange visa;
L2 series labels; or
Deferred Action for Childhood Arrivals (DACA) status.

(10) "Eligible program of study" means an undergraduate program, of a least two (2) academic years' duration, offered by an educational institution which:

(a) For purposes of the KTG or CAP Grant Programs, leads to a degree; or

(b) For purposes of only the CAP Grant Program:

Leads to a certificate or diploma while attending a publicly operated vocational-technical institution;
Is designated as an equivalent undergraduate program of study by the Council on Postsecondary Education; or
Is a comprehensive transition and postsecondary program as defined in KRS 164.740(3).

(11) "Expected family contribution" means the amount that a student and his family are expected to contribute toward the cost of the student's education determined by applying the federal methodology established in 20 U.S.C. 1087kk through 1087vv to the information that the student and his family provided on the application.

(12) "Federal act" is defined by KRS 164.740(8) and means 20 U.S.C. 1001 through 1146a.

(13) "Full-time student" means an enrolled student who is carrying a full-time academic workload:

(a) That may include any combination of courses, work, research, or special studies that the institution considers sufficient to classify the student as a full-time student, except that correspondence courses shall not be counted in determining the student's full-time status; and

(b) As determined by the institution under a standard applicable to all students enrolled in a particular educational program, except that for an undergraduate student, an institution's minimum standard shall equal or exceed one (1) of the following minimum requirements:

Twelve (12) semester hours or eighteen (18) quarter hours per academic term in an educational program using a semester, trimester, or quarter system;
Twenty-four (24) semester hours or thirty-six (36) quarter hours per academic year for an educational program using credit hours, but not using a semester, trimester, or quarter system, or the prorated equivalent for a program of less than one (1) academic year;
Twenty-four (24) clock hours per week for an educational program using clock hours;
In an educational program using both credit and clock hours, any combination of credit and clock hours if the sum of the following fractions is equal to or greater than one (1):

a. For a program using a semester, trimester, or quarter system, the number of credit hours per term divided by twelve (12) and the number of clock hours per week divided by twenty-four (24); or

b. For a program not using a semester, trimester, or quarter system, the number of semester or trimester hours per academic year divided by twenty-four (24), the number of quarter hours per academic year divided by thirty-six (36), and the number of clock hours per week divided by twenty-four (24);

A series of courses or seminars that equals twelve (12) semester hours or twenty-four (24) quarter hours in a maximum of eighteen (18) weeks; or
The work portion of a cooperative education program in which the amount of work performed is equivalent to the academic workload of a full-time student.

(14) "Grant" is defined by KRS 164.740(9).

(15) "Kentucky Tuition Grant" or "KTG" means the program of student financial assistance grants authorized by KRS 164.780 and 164.785 for residents of Kentucky who bear the major costs of attending an educational institution and who demonstrate financial need.

(16) "KHEAA grant" means an award of a student financial assistance grant under the College Access Program or the Kentucky Tuition Grant Program or a combination of the two (2).

(17) "KHEAA grant limit" means an aggregate limitation on KHEAA grant awards:

(a) That are made to an individual for all academic years of the eligible program of study in which the student receives a KHEAA grant (including any KHEAA grant limit previously used in a different eligible program of study or at a different educational institution); and

(b) That shall be:

Measured in terms of the applicable percentage of the maximum KHEAA grant that would have been disbursed for the academic year to a full-time student and not fully refunded;
Depleted each academic term by subtracting, from the applicable percentage, the percentage used for the academic term, derived by dividing the net amount of KHEAA grant disbursed for the academic term by the maximum KHEAA grant award for the academic year that would have been disbursed to a full-time student, using the then current maximum KHEAA grant; and
Based upon the following applicable percentages representing the aggregate limitation of KHEAA grant awards:

a. 200 percent for a student enrolled in a two (2) year eligible program of study; or

b. 400 percent for a student enrolled in a four (4) year eligible program of study.

(18) "KHEAA grant program officer" or "KGPO" means the official designated on the administrative agreement, pursuant to KRS 164.748(6), to serve as the educational institution's on-campus agent to certify all institutional transactions and activities with respect to the authority's grant programs.

(19) "On-ground course" means a course that meets the following criteria:

(a) Instruction is delivered face-to-face, typically in a lecture-style format, in a setting in which the student and the instructor are in the same physical location on the educational institution's campus; and

(b) Is not an online course.

(20) "Online course" means a course for which any portion of the instruction is transmitted electronically over telecommunication lines or the Internet.

(21) "Overaward" means receipt of financial assistance from all sources in excess of a student's need determined in accordance with 11 KAR 5:130 through 5:145.

(22) "Participating institution" is defined in KRS 164.740(14).

(23) "Part-time student" means an enrolled student who is carrying an academic workload:

(a) That may include any combination of courses, work, research, or special studies that the institution considers sufficient to classify the student as at least a half-time student, except that correspondence courses shall not be counted in determining the student's part-time status; and

At least six (6) semester hours per semester;
Six (6) quarter hours per quarter; or
Half of the academic workload of a full-time student as determined by the educational institution.

(24) "Pell Grant" means an award under the federal Pell Grant Program operated by the secretary under the provisions of 20 U.S.C. 1070a.

(25) "Resident of Kentucky" or "resident" means a person who is determined by the participating institution to be a resident of Kentucky in accordance with the criteria established in 13 KAR 2:045.

(26) "Total cost of education" means an amount determined for an academic year for each applicant by the following formula: normal tuition and fees charged by the institution chosen by the applicant, plus maximum board contract amount, plus minimum room contract amount.

History

RELATES TO: KRS 164.740-164.785
STATUTORY AUTHORITY: KRS 164.748(4), 164.753(4)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.748(4) requires the authority to promulgate administrative regulations pertaining to the awarding of grants, scholarships, and honorary scholarships as provided in KRS 164.740 to 164.7891. KRS 164.753(4) requires the authority to promulgate administrative regulations pertaining to grants. This administrative regulation defines terms used in 11 KAR Chapter 5 pertaining to the Kentucky Tuition Grant Program and the College Access Program.
History: 18 Ky.R. 3543; 19 Ky.R. 388; eff. 8-1-1992; 1628; eff. 3-4-1993; 21 Ky.R. 52; eff. 9-12-1994; 25 Ky.R. 390; 809; eff. 10-1-1998; 25 Ky.R. 2920; 26 Ky.R. 367; eff. 8-2-1999; 2272; 27 Ky.R. 487; eff. 8-14-2000; 29 Ky.R. 159, 738; 903; eff. 10-7-2002; 30 Ky.R. 351; 832; eff. 10-31-2003; 31 Ky.R. 574; 1048; eff. 1-4-2005; 34 Ky.R. 822; 1386; eff. 1-4-2008; 40 Ky.R. 72; 527; eff. 9-9-2013; 41 Ky.R. 828; 1494; eff. 2-6-2015; Cert eff. 9-28-2018; 49 Ky.R. 1332, 1741; eff. 5-30-2023; 50 Ky.R. 66, 1034; eff. 12-11-2023.

11 KAR 5:033 KTG student eligibility requirements {#sec-11-kar-5-033 omnilex-key=us-ky-regs-official--title-11--11 KAR 5:033}

Section 1. Eligibility of Students. In order to qualify for disbursement of a Kentucky tuition grant, a student shall:

(1) Be a resident of the Commonwealth of Kentucky;

(2) Be enrolled as a full-time student in an eligible program of study;

(3) Be enrolled at an educational institution and not have previously earned a first baccalaureate or professional degree;

(4) Be determined by the authority, in accordance with 11 KAR 5:130 and 5:140, to have established financial need for the KTG;

(5) Have remaining KHEAA grant limit;

(6) Not receive financial assistance in excess of need to meet educational expenses;

(7) Maintain satisfactory progress in an eligible program of study according to the published standards and practices of the educational institution at which the student is enrolled;

(8) Satisfy all financial obligations to the authority and to any educational institution. Ineligibility under this subsection may be waived for cause by the executive director of the authority, at the recommendation of a designated staff review committee, for cause;

(9) Be a citizen of the United States or an eligible noncitizen;

(10) Be receiving full-time credit at an educational institution in an eligible program of study and paying full-time tuition and fees to that institution, if the student is studying abroad or off-campus;

(11) Be:

(a) Attending an eligible institution with the main campus or headquarters located in Kentucky; or

(b) Attending at least fifty (50) percent of courses on-ground in Kentucky if enrolled at an eligible institution with the main campus or headquarters not located in Kentucky; and

(12) Not be:

(a) In default on any loan under Title IV of the federal act, codified as 20 U.S.C. 1070 to 1099, unless eligibility has been reinstated;

(b) Liable for any amounts that exceed annual or aggregate limits on any loan under Title IV of the federal act, codified as 20 U.S.C. 1070 to 1099; and

History

RELATES TO: KRS 164.753(4), 164.780, 164.785
STATUTORY AUTHORITY: KRS 164.748(4), 164.785
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.785 establishes the Kentucky Tuition Grant Program. KRS 164.748(4) and 164.753(4) require the Kentucky Higher Education Assistance Authority to promulgate an administrative regulation to administer grant programs to provide financial assistance to students to attend Kentucky educational institutions. This administrative regulation establishes student eligibility requirements for the Kentucky tuition grant program.
History: 18 Ky.R. 3544; eff. 8-1-1992; 31 Ky.R. 1315; 1503; eff. 3-11-2005; 33 Ky.R. 3225; 3589; eff. 7-6-2007; 41 Ky.R. 831; 1496; eff. 2-6-2015; Crt eff. 9-28-2018; Crt eff. 2-19-2025.

11 KAR 5:037 CAP Grant student eligibility {#sec-11-kar-5-037 omnilex-key=us-ky-regs-official--title-11--11 KAR 5:037}

Section 1. To qualify for disbursement of a college access program grant, a student shall:

(1) Be a resident of Kentucky;

(2) Be enrolled at an educational institution as at least a part-time student, as determined by the educational institution, in an eligible program of study and not have previously earned a first baccalaureate or professional degree;

(3) Demonstrate financial need in accordance with 11 KAR 5:130 and 11 KAR 5:145 for CAP grant assistance;

(4) Have remaining KHEAA grant limit;

(5) Not receive financial assistance in excess of the need to meet educational expenses;

(6) Maintain satisfactory progress in an eligible program of study according to the published standards and practices of the educational institution in which the student is enrolled;

(7) Satisfy all financial obligations to the Authority under any program administered pursuant to KRS 164.740 to 164.7891 and to any educational institution, except that ineligibility for this reason may be waived by the executive director of the Authority, at the recommendation of a designated staff review committee, for cause;

(8) Be a citizen of the United States or an eligible noncitizen;

(9) Be receiving at least part-time credit at an educational institution in an eligible program of study and paying at least part-time tuition and fees to that institution, if the student is studying abroad or off-campus.

(10) Have been eligible to receive a CAP Grant in the preceding year, if the student is enrolled in an equivalent undergraduate program of study, established by the Authority in 11 KAR 15:090, Section 5;

(11) Be:

(a) Attending an eligible institution with the main campus or headquarters located in Kentucky; or

(b) Attending at least fifty (50) percent of courses on-ground in Kentucky if enrolled at an eligible institution with the main campus or headquarters not located in Kentucky; and

(12) Not be:

(a) In default on any loan under Title IV of the federal act, codified at 20 U.S.C. 1070 to 1099, unless eligibility has been reinstated;

(b) Liable for any amounts that exceed annual or aggregate limits on any loan under Title IV of the federal act, codified at 20 U.S.C. 1070 to 1099; and

History

RELATES TO: KRS 164.744(2), 164.753(4)
STATUTORY AUTHORITY: KRS 164.748(4), 164.753(4), 164.7535
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.748(4) requires the Authority to promulgate administrative regulations pertaining to the awarding of grants, scholarships, and honorary scholarships as provided in KRS 164.740 to 164.7891. KRS 164.753(4) requires the Authority to promulgate administrative regulations pertaining to grants. KRS 164.7535 authorizes the Authority to provide grants to assist financially needy part-time and full-time undergraduate students to attend educational institutions in Kentucky. This administrative regulation establishes student eligibility criteria for the college access program.
History: 49 Ky.R. 1370, 1743; eff. 5-30-2023.

11 KAR 5:110 Dual enrollment under consortium agreement {#sec-11-kar-5-110 omnilex-key=us-ky-regs-official--title-11--11 KAR 5:110}

Section 1. For purposes of the CAP grant program, a student who is otherwise eligible pursuant to 11 KAR 5:034, except that the student is enrolled simultaneously in two (2) or more educational institutions pursuing an eligible program of study jointly offered by those institutions, is eligible under this section if the program of study is covered by a consortium agreement between the educational institutions and if the student is carrying a combined academic workload at all educational institutions in the consortium equal to full-time enrollment at the primary institution.

Section 2. Consortium Agreement. Two (2) or more educational institutions participating in the CAP grant program may, for purposes of Section 1 of this administrative regulation, execute a consortium agreement which meets the following terms and conditions:

(1) The agreement shall be written and signed by authorized representatives of each participating educational institution;

(2) The agreement shall designate which educational institution will serve as the "primary" institution; and

(3) The agreement shall specify:

(a) The tuition, fees, room and board cost, and all other costs assessed to the student by each institution; and

(b) That the primary institution will perform the duties set forth in Section 3 of this administrative regulation.

Section 3. Duties of Primary Institution. For purposes of Section 2 of this administrative regulation, the primary institution designated in a consortium agreement shall assume the following duties and responsibilities:

(1) Counsel students, who are enrolled or accepted for enrollment in programs of study covered by the consortium agreement, concerning student eligibility, rights, and responsibilities under the CAP grant program;

(2) Maintain all records, including information from all participating institutions about the student's grades, institutional costs incurred, financial aid received, enrollment, and all other information related to the student's eligibility as is required to be maintained on any other CAP grant recipient enrolled only in the primary institution;

(3) Disburse the CAP grant;

(4) Confer academic credit to the student for all courses completed at other educational institutions under the consortium agreement as if the courses had been provided by the primary institution;

(5) Monitor the student's enrollment status at all educational institutions in the consortium and indicate the student's enrollment at the primary institution as the equivalent of the combined enrollment at all educational institutions in the consortium;

(6) Calculate any refund or repayment and make any such refund based on the primary institution's refund policy, based upon any change in enrollment at any of the educational institutions in the consortium, as if the student were enrolled only at the primary institution;

(7) Provide to the authority, on behalf of all educational institutions in the consortium, all reports and notifications required by law or administrative regulation as if the student were enrolled only at the primary institution.

Section 4. The consortium agreement may contain any other terms and conditions, not inconsistent with this administrative regulation, as may be deemed necessary or appropriate by the participating educational institutions.

History

RELATES TO: KRS 164.744(2), 164.753(4), 164.7535
STATUTORY AUTHORITY: KRS 13A.100, 164.748(4), 164.753(4), 164.7535
NECESSITY, FUNCTION, AND CONFORMITY: The Kentucky Higher Education Assistance Authority administers the CAP grant program pursuant to KRS 164.740 to 164.766. This administrative regulation sets the conditions for CAP grant eligibility of a student simultaneously enrolled in two (2) or more participating educational institutions. This amendment replaces references to the state student incentive grant program with references to the college access program.
History: 15 Ky.R. 884; eff. 11-4-1988; 18 Ky.R. 3475; eff. 8-1-1992; TAm eff. 5-16-2016; Crt eff. 9-28-2018; Crt eff. 2-19-2025.

11 KAR 5:130 Student application {#sec-11-kar-5-130 omnilex-key=us-ky-regs-official--title-11--11 KAR 5:130}

Section 1.

(1) In order to receive a KHEAA grant, the Free Application for Federal Student Aid (FAFSA) set forth in 11 KAR 4:080, Section 1(1), shall be completed and submitted in accordance with the instructions provided on the FAFSA.

(2) An applicant shall indicate the choices of educational institutions on the application to be considered for the KHEAA grant. All educational institutions listed on the FAFSA shall be used in the determination of eligibility for a KHEAA grant program award.

(3) A person who submits a completed FAFSA shall not be eligible for a KHEAA grant for an academic year in which the person:

(a) Did not select on the application an educational institution that participates in a KHEAA grant program;

(b) Is not:

A United States citizen or eligible noncitizen; and
A resident of Kentucky;

(c) Is a graduate student, except that a student enrolled in a program of study designated as an equivalent undergraduate program of study by the Council on Postsecondary Education shall not be ineligible for a CAP grant by reason of this paragraph; or

(d) Will obtain a first baccalaureate degree before July 1 of the academic year for which he is seeking financial assistance.

Section 2. Change of Application Data. The applicant shall change or correct FAFSA data using the Student Aid Report (SAR), which is provided to the applicant by the United States Department of Education, and submit the change or correction according to the instructions on the SAR.

History

RELATES TO: KRS 164.744(2), 164.753(4), 164.7535, 164.780, 164.785
STATUTORY AUTHORITY: KRS 164.746(6), 164.748(4), 164.7535
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.748(4) requires KHEAA to promulgate administrative regulations pertaining to the awarding of grants, scholarships, and honorary scholarships as provided in KRS 164.740 to 164.7891. This administrative regulation establishes the application procedures for a student to follow to apply for and establish financial need for KHEAA grant programs.
History: 15 Ky.R. 1600; eff. 3-23-1989; 16 Ky.R. 2684; eff. 8-9-1990; 17 Ky.R. 3479; eff. 8-2-1991; 18 Ky.R. 3477; 19 Ky.R. 389; eff. 8-1-1992; 1629; 2233; eff. 4-7-1993; 21 Ky.R. 55; eff. 9-12-1994; 2152; eff. 5-4-1995; 23 Ky.R. 158; 1387; eff. 9-5-1996; 24 Ky.R. 1538; 1865; eff. 3-16-1998; 25 Ky.R. 888; eff. 12-3-1998; 25 Ky.R. 2922; eff. 8-2-1999; 26 Ky.R. 1427; eff. 3-10-2000; 28 Ky.R. 1904; eff. 4-15-2002; 29 Ky.R. 162; 9-9-2002; 2497; 2863; eff. 6-3-2003; 30 Ky.R. 1574; eff. 3-18-2004; 31 Ky.R. 1692; eff. 6-13-2005; 32 Ky.R. 1310; 1605; eff. 3-31-2006; 33 Ky.R. 175; 709; eff. 10-6-2006; Crt eff. 9-28-2018; Crt eff. 2-19-2025.

11 KAR 5:140 KTG award determination procedure {#sec-11-kar-5-140 omnilex-key=us-ky-regs-official--title-11--11 KAR 5:140}

Section 1. Kentucky Tuition Grant (KTG) Program Awards. An application submitted pursuant to 11 KAR 4:080 and 11 KAR 5:130 shall be reviewed for determination of eligibility for a KTG.

Section 2. KTG Need. For each KTG eligible applicant, the KTG need shall be computed according to the following formula: KTG need equals total cost of education minus the sum of:

(1) Expected Pell grant;

(2) Expected family contribution; and

(3) CAP grant.

Section 3. KTG Award.

(1) If an applicant does not qualify for a CAP grant and the KTG need is an amount equal to or greater than $200, the KTG shall be the lesser of the KTG need or the maximum grant authorized by KRS 164.785(3), except that KTG awards shall be offered only to the extent funds are available.

(2) If an applicant does not qualify for a CAP grant, and the KTG need is an amount less than $200, an award shall not be made.

(3) If an applicant has received a CAP award and KTG need is an amount equal to or greater than fifty (50) dollars, the KTG award shall be the lesser of the KTG need or the maximum grant specified in Section 5 of this administrative regulation except that KTG awards shall be offered only to the extent that funds are available.

(4) A KTG award shall not exceed $3,000 for an academic year.

Section 4.

(1) A KHEAA grant shall not exceed the cost of tuition and fees charged to the student during the academic year of the award.

(2) A KHEAA grant awarded to an incarcerated individual shall be considered an overaward to the extent that the KHEAA grant, in combination with financial assistance received from other sources, exceeds the student's actual cost for tuition, fees, and books.

(3) A semester award shall not exceed tuition and fee charges for that semester.

(4) A KHEAA grant award shall not be made for a summer academic term.

Section 5.

(1) A KHEAA grant award shall not exceed the applicant's total cost of education less expected family contribution and other anticipated student financial assistance.

(2) The authority shall reduce or revoke a KHEAA grant upon receipt of documentation that financial assistance from other sources in combination with the KHEAA grant exceeds the educational institution's determination of financial need for that student.

(3) The KHEAA grant program officer (KGPO) and the grant recipient shall make every reasonable effort to provide the authority the information needed to prevent an overaward.

(4) If the applicant's expected family contribution, disbursed KHEAA grant amount, plus other student financial assistance exceeds his need, the excess shall be considered to be an overaward. If an overaward occurs, this amount shall be returned to the authority immediately.

Section 6.

(1) If the authority receives revised data that, upon recomputation, results in the student becoming ineligible for a KHEAA grant that has already been offered, but not disbursed, the grant shall be revoked.

(2) If the student is determined to be ineligible after the KHEAA grant has been disbursed, the student shall repay to the authority the entire amount of the KHEAA grant for which the student was ineligible.

Section 7.

(1) If the authority receives revised data that, upon recomputation, necessitates reduction of the KHEAA grant and the grant has not yet been disbursed, the reduction shall be made to both the fall and spring disbursements, and the student shall be notified of the reduction.

(2) If the grant for the fall academic term has already been disbursed, the reduction shall be made to the spring disbursement.

(3) If both the fall and spring disbursements have been made, the student shall repay the overaward to the authority.

Section 8. Students requested by the institution to provide verification of data for any financial assistance program shall provide the verification before receiving disbursement of a KHEAA grant. Any student who is awarded a KHEAA grant who fails to provide verification requested by the educational institution shall be deemed ineligible, and the grant shall be revoked.

History

RELATES TO: KRS 164.744(2), 164.753(4), 164.780, 164.785
STATUTORY AUTHORITY: KRS 164.748(4), 164.753(4)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.748(4) requires the authority to promulgate administrative regulations pertaining to the awarding of grants, scholarships, and honorary scholarships as provided in KRS 164.740 to 164.7891. KRS 164.753(4) requires the authority to promulgate administrative regulations pertaining to grants. This administrative regulation establishes the award determination procedures for the Kentucky tuition grant program.
History: 15 Ky.R. 1601; eff. 2-3-1989; 16 Ky.R. 2686; eff. 8-9-1990; 17 Ky.R. 3480; eff. 8-2-1991; 18 Ky.R. 3478; eff. 8-1-1992; 19 Ky.R. 1630; eff. 3-4-1993; 21 Ky.R. 2153; eff. 5-4-1995; 26 Ky.R. 2275; 27 Ky.R. 469; eff. 8-14-2000; 27 Ky.R. 3305; eff. 8-15-2001; 30 Ky.R. 354; eff. 10-31-2003; 31 Ky.R. 1317; 1504; eff. 3-11-2005; 1693; eff. 6-13-2005; 33 Ky.R. 176; 710; eff. 10-6-2006; 3228; eff. 7-6-2007; 40 Ky.R. 75; eff. 9-9-2013; Crt eff. 9-28-2018; Crt eff. 2-19-2025.

11 KAR 5:145 CAP grant award determination procedure {#sec-11-kar-5-145 omnilex-key=us-ky-regs-official--title-11--11 KAR 5:145}

Section 1. Each application submitted pursuant to 11 KAR 4:080 and 11 KAR 5:130 shall be reviewed for determination that all eligibility requirements established in 11 KAR 5:034 are met. To qualify for a CAP award based on financial need, the applicant's expected family contribution shall be $6,206 or less.

Section 2. CAP Grant Award.

(1) Except as provided in subsection (2) of this section, the maximum CAP grant in any semester for an applicant accepted for enrollment on a full-time basis as determined by the educational institution in an eligible program shall be the lesser of:

(a) $1,250 for an applicant enrolled in a two (2) year institution;

(b) $2,650 for an applicant enrolled in a four (4) year institution; or

(2) The maximum CAP grant in any semester for an applicant accepted for enrollment on less than a full-time basis as determined by the educational institution in an eligible program shall be:

(a) The amount specified in subsection (1)(a) or (b) of this section:

Divided by twelve (12); and
Multiplied by the number of credit hours in which the applicant is accepted for enrollment; and

(b) Not in excess of the maximum specified in subsection (1)(c) of this section.

(3) For any academic year, a student shall not receive more than $2,500 if enrolled in a two (2) year institution or $5,300 if enrolled in a four (4) year institution for an aggregate CAP grant award.

Section 3.

(1) A KHEAA grant awarded to an incarcerated individual shall be considered an over award to the extent that the KHEAA grant, in combination with financial assistance received from other sources, exceeds the student's actual cost for tuition, fees, and books.

(2) A KHEAA grant award shall not be made for a summer academic term.

Section 4.

(1) A KHEAA grant award shall not exceed the applicant's cost of education less expected family contribution and other anticipated student financial assistance.

(3) The KHEAA Grant Program Officer (KGPO) and the grant recipient shall make every reasonable effort to provide the authority the information needed to prevent an over award.

(4) If the applicant's expected family contribution, disbursed KHEAA grant amount, plus other student financial assistance exceeds his or her need, the excess shall be considered to be an over award. If an over award occurs, this amount shall be returned to the authority immediately.

Section 5.

(2) If the student is determined to be ineligible after the KHEAA grant has been disbursed, the student shall repay to the authority the entire amount of the KHEAA grant.

Section 6. If the educational institution receives revised data that, upon recomputation, necessitates reduction of the KHEAA grant, and:

(1) If the grant has not yet been disbursed for the fall academic term, the reduction shall be made to both the fall and spring disbursements and the educational institution shall notify the student of the reduction;

(2) If the grant for the fall academic term has already been disbursed and the student enrolls for the spring academic term, the reduction shall be made to the spring disbursement and the educational institution shall notify the student of the reduction;

(3) If the grant for the fall academic term has already been disbursed and the student does not enroll for the spring academic term, the educational institution shall notify the student of the fall overaward and the student shall repay the overaward to the authority; or

(4) If both the fall and spring disbursements have been made, the educational institution shall notify the student of the overaward and the student shall repay the overaward to the authority.

Section 7.

(1) Students requested by the institution to provide verification of data for any financial assistance program shall provide the verification before receiving disbursement of a KHEAA grant.

(2) Any student who is awarded a KHEAA grant who fails to provide verification requested by the participating institution shall be deemed ineligible, and the grant shall be revoked.

History

RELATES TO: KRS 164.744(2), 164.753(4), 164.7535, 164.7889(3)
STATUTORY AUTHORITY: KRS 164.748(4), 164.753(4), 164.7889(3)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.748(4) requires the authority to promulgate administrative regulations pertaining to the awarding of grants, scholarships, and honorary scholarships as provided in KRS 164.740 to 164.7891. KRS 164.753(4) requires the authority to promulgate administrative regulations pertaining to grants. KRS 164.7889(3) requires the authority to promulgate an administrative regulation that establishes the maximum amount available under the grant programs, and the average income level for qualification for the grant programs if sufficient funds are available. This administrative regulation prescribes the award determination procedures for the CAP Grant Program.
History: 18 Ky.R. 3547; eff. 8-1-1992; 19 Ky.R. 1631; 2233; eff. 4-7-1993; 21 Ky.R. 56; eff. 9-12-1994; 26 Ky.R. 2277; 27 Ky.R. 469; eff. 8-14-2000; 3306; eff. 8-15-2001; 29 Ky.R. 164; eff. 9-9-2002; 30 Ky.R. 355; 834; eff. 10-31-2003; 31 Ky.R. 577; 922; 11-8-2004; 1694; eff. 6-13-2005; 33 Ky.R. 178; 710; eff. 10-6-2006; 34 Ky.R. 106; eff. 9-10-2007; 34 Ky.R. 2323, eff. 8-1-2008; 36 Ky.R. 123; eff. 10-12-2009; 37 Ky.R. 84; eff. 10-1-2010; 38 Ky.R. 1611; eff. 6-11-2012; 40 Ky.R. 76; eff. 9-9-13; 41 Ky.R. 2100; eff. 7-6-2015; 42 Ky.R. 2612, eff. 7-1-2016; Cert eff. 9-28-2018; 45 Ky.R. 105, 626; eff. 10-5-2018; 45 Ky.R. 3239; eff. 8-2-2019; 48 Ky.R. 2781; 49 Ky.R. 309; eff. 11-1-2022; 49 Ky.R. 1335, 1744; eff. 5-30-2023.

11 KAR 5:150 Notification of award {#sec-11-kar-5-150 omnilex-key=us-ky-regs-official--title-11--11 KAR 5:150}

Section 1. The authority shall notify each KHEAA grant recipient of the authority's determination of eligibility for a KHEAA grant.

Section 2. The authority shall direct applicants to the KHEAA Web site to inform them of the amount of award or the reason for their denial.

Section 3. The KGPO may access on the KHEAA Web site the educational institution's College Summary File listing applicants who have indicated that they may enroll at the institution.

History

RELATES TO: KRS 164.740-164.764, 164.780, 164.785, 164.7535
STATUTORY AUTHORITY: KRS 164.748(4), 164.753(4)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.748(4) requires KHEAA to promulgate administrative regulations pertaining to the awarding of grants, scholarships, and honorary scholarships as provided in KRS 164.740 to 164.785. KRS 164.753(4) requires the authority to promulgate administrative regulations pertaining to grants. This administrative regulation sets forth the procedures for notification to applicants and to educational institutions.
History: 15 Ky.R. 1604; eff. 2-3-1989; 18 Ky.R. 3480; eff. 8-1-1992; 21 Ky.R. 447; eff. 10-6-1994; 29 Ky.R. 166; eff. 9-9-2002; Crt eff. 9-28-2018; Crt eff. 2-19-2025.

11 KAR 5:160 Disbursement procedures {#sec-11-kar-5-160 omnilex-key=us-ky-regs-official--title-11--11 KAR 5:160}

Section 1. Eligibility Verification.

(1) The KGPO shall certify the eligibility of students and submit to the authority a complete and accurate eligibility verification file (EVF), according to instructions accompanying the eligibility verification file layout provided by the authority, to indicate which KHEAA grant recipients are actually enrolled at the institution.

(2) The educational institution shall submit to the authority a properly certified eligibility verification file (EVF):

(a) For the fall academic term, by:

October 1 for educational institutions using nonquarter hour academic terms; and
October 15 for educational institutions using quarter hour academic terms; and

(b) For the spring academic term, by:

February 15 for educational institutions using nonquarter hour academic terms; and
April 15 for educational institutions using quarter hour academic terms.

(3) The instructions accompanying the eligibility verification file layout shall specify:

(a) Conditions under which a KHEAA grant shall be disbursed to the benefit of the KHEAA grant recipient; and

(b) Conditions under which KHEAA grant funds shall be returned to the authority.

(4) If the KGPO fails to provide complete and accurate information in the proper format in the eligibility verification file according to the instructions or fails to submit the file to the authority by the deadline established in subsection (2) of this section, the authority shall not advance KHEAA grant funds in the next academic term until the file for the next academic term is properly certified and submitted.

Section 2. Disbursement and Delivery of Funds. KHEAA grant funds shall be disbursed by the authority twice during an academic year to educational institutions for subsequent delivery to eligible students or application of the funds to the accounts of eligible students during the academic term for which the funds are received by the educational institution.

(1)

(a) Except as provided in Section 1(4) of this administrative regulation and subject to the availability of funds, the authority shall disburse in August to educational institutions, for subsequent delivery to eligible students or application of the funds to the accounts of eligible students enrolled at the institution during the fall academic term, the amount of KHEAA grant funds equal to the total amount of KHEAA grant funds that the institution properly paid to students for the fall academic term of the preceding academic year.

(b) Except as provided in Section 1(4) of this administrative regulation and subject to the availability of funds, the authority shall disburse in January to educational institutions, for subsequent delivery to eligible students or application of the funds to the accounts of eligible students enrolled at the institution during the spring academic term, the amount of KHEAA grant funds equal to the total amount of KHEAA grant funds that the institution properly paid to students for the spring academic term of the preceding academic year.

(2) The educational institution shall deliver KHEAA grant funds to eligible students or apply KHEAA grant funds to the accounts of eligible students enrolled for the academic term beginning not earlier than ten (10) days before the first day of classes of each semester, trimester or quarter of the academic term.

(3)

(a) Upon receipt of the properly certified eligibility verification file for that academic term, the authority shall process the EVF data and update the grant database with award information.

(b) Based on the newly-revised database, the authority shall generate a semester college disbursement report/file for each institution.

(c) Based on this update, the authority shall determine through a reconciliation process whether any additional funds are owed to or refunds are due from the institution.

If additional funds are owed to the institution, the authority shall forward those funds to the institution.
If refunds are due from the institution, the authority shall bill the institution.

(4) Not later than thirty (30) days after the end of the academic term, the KGPO shall return to the authority, according to instructions attached to the eligibility verification file layout, all funds advanced for that academic term that remain undisbursed to eligible students. The authority may withhold any services and funds from the educational institution from the due date until the eligibility verification file and all funds advanced, that remain undisbursed to eligible students, are received by the authority.

Section 3. A KTG awarded for the academic year shall be disbursed by the authority:

(1) To institutions using nonquarter hour academic terms, in the amount of one-half (1/2) for the fall academic term and one-half (1/2) for the spring academic term; and

(2) To institutions using quarter hour academic terms, no more than one-third (1/3) per quarter.

Section 4.

(1) A CAP grant awarded for the academic year shall be disbursed by the authority:

(a) To institutions using nonquarter hour academic terms, in the amount of one-half (1/2) for the fall academic term and one-half (1/2) for the spring academic term; and

(b) To institutions using quarter hour academic terms, no more than one-third (1/3) per quarter.

(2) The educational institution shall adjust the amount of the CAP grant delivered to an eligible student or applied to the account of an eligible student enrolled at the institution if the student is enrolled part time during the academic term.

Section 5.

(1) KHEAA grants disbursed by the authority to eligible students enrolled at an educational institution that uses a short winter term in combination with longer fall and spring terms shall be applied by the institution to the student's account or delivered to the student so that the first disbursement shall be in the fall academic term and the second disbursement shall be in the spring academic term.

(2) Enrollment during the shorter winter academic term shall not qualify a student for KHEAA grant assistance for that academic term. Credit hours for which the student is enrolled during the short winter academic term may be added to credit hours for which the student enrolls in the fall and spring academic terms to establish enrollment as a full-time student during those academic terms.

Section 6.

(1) The educational institution shall:

(a) Be responsible for proper disbursement of KHEAA grants to the eligible students during the academic term for which the grants are intended;

(b) Not make KHEAA grant funds available to the grant recipient nor apply those funds to the recipient's account:

Prior to the date that the recipient has completed the registration requirements (except for the payment of tuition and fees) at the institution for each academic semester or quarter for which the KHEAA grant is awarded; or
After the end of the academic term for which the funds are received by the institution;

(c) Be liable for disbursement to the wrong individual or to an ineligible student or for untimely disbursement pursuant to this section; and

(d) Make restitution to the authority of any amount improperly disbursed.

(2) Failure of the institution to make restitution when required shall, without precluding other remedies, be deemed cause for limitation, suspension or termination of the participation of the institution in accordance with 11 KAR 4:020.

History

RELATES TO: KRS 164.7535, 164.780, 164.785
STATUTORY AUTHORITY: KRS 164.748(4), 164.753(4)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.748(4) requires the authority to promulgate administrative regulations pertaining to the awarding of grants, scholarships, and honorary scholarships as provided in KRS 164.740 to 164.7891. KRS 164.753(4) requires the authority to promulgate administrative regulations pertaining to grants. This administrative regulation establishes the disbursement procedures for KHEAA grant programs.
History: 15 Ky.R. 1605; eff. 2-3-1989; 16 Ky.R. 2688; eff. 8-9-1990; 18 Ky.R. 3481; eff. 8-1-1992; 21 Ky.R. 57; eff. 9-12-1994; 2154; eff. 5-4-1995; 26 Ky.R. 2279; 27 Ky.R. 470; eff. 8-14-2000; 28 Ky.R. 651; eff. 11-5-2001; 29 Ky.R. 167; 741; 905; eff. 10-7-2002; 30 Ky.R. 357; 834; eff. 10-31-2003; 31 Ky.R. 1318; 1504; eff. 3-11-2005; Crt eff. 9-28-2018; Crt eff. 2-19-2025.

11 KAR 5:170 Refund and repayment policy {#sec-11-kar-5-170 omnilex-key=us-ky-regs-official--title-11--11 KAR 5:170}

Section 1.

(1) A student who fails to enroll, withdraws, is expelled from the institution, or otherwise fails to complete the program on or after his first day of class of the period of enrollment or changes enrollment status may be due a refund of monies paid to the institution on behalf of that student or may owe a repayment of cash disbursements made to the student for educational expenses.

(2) If the student received financial assistance administered by the authority, all or a portion of the refund and repayment shall be due to the authority for its financial assistance programs in accordance with Sections 2 and 3 of this administrative regulation.

Section 2.

(1) The institution shall adopt and implement a fair and equitable refund and repayment policy for financial assistance administered by the authority which shall be:

(a) A clear and conspicuous written statement;

(b) Made available to a prospective student, prior to the earlier of the student's enrollment or the execution of the student's enrollment agreement, and to currently enrolled students;

(d) Made available to the authority upon request.

(2) The institution's refund and repayment policy for financial assistance administered by the authority may use the same methods and formulas for determining the amount of a refund or repayment as the institution uses for determining the return of federal financial assistance funds or the institution may adopt a separate and distinct policy that is based upon:

(a) The requirements of applicable state law; or

(b) The specific refund standards established by the institution's nationally recognized accrediting agency.

(3) The amount of the refund and repayment shall be determined in accordance with the educational institution's refund and repayment policy relative to financial assistance funds, except as provided in Section 3 of this administrative regulation.

(4) When the institution determines that a refund or repayment of financial assistance is due in accordance with its policy, the institution shall allocate to the financial assistance programs administered by the authority the refund and repayment in the following descending order of priority prior to allocating the refund to institutional or private sources of financial assistance:

(a) CAP Grant;

(b) KTG;

(d) Teacher Scholarship;

(e) Kentucky Educational Excellence Scholarship;

(f) Kentucky Coal County College Completion Scholarship;

(g) National Guard Tuition Assistance; and

(h) Early Childhood Development Scholarship.

Section 3. If a KHEAA grant recipient officially or unofficially withdraws from or is expelled by an institution before the first day of classes of the award period, the award shall be deemed an overaward and a full refund or repayment of the KHEAA grant shall be required, notwithstanding any institutional policy to the contrary. If the institution is unable to document the student's last date of attendance, any KHEAA grant disbursement for that award period shall be subject to full refund and repayment. If, at any time, a KHEAA grant recipient's enrollment is terminated with no assessment of tuition and fees by the institution, then the full KHEAA grant shall be subject to cancellation, if not yet disbursed, or refund and repayment if the grant has already been disbursed.

Section 4.

(1) The institution shall remit to the authority the amount of funds allocated from the refund amount to the financial assistance programs administered by the authority as soon as possible but no later than thirty (30) days after the end of the term in which the student ceased to be enrolled.

(2) Refunds by the institution and notification of student repayment due transmitted to the authority shall be accompanied by:

(a) The student's name and Social Security number;

(b) The reason for the refund or repayment;

(d) The semester and year; and

(e) The calculation used for determining the refund or repayment.

History

RELATES TO: KRS 164.748(4), (8), (12), (14), 164.753(4)(a), 164.7535, 164.780, 164.785
STATUTORY AUTHORITY: KRS 164.748(4)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.748(4) requires the authority to promulgate administrative regulations pertaining to the awarding of grants, scholarships, and honorary scholarships as provided in KRS 164.740 to 164.7891. KRS 164.753(4) requires the authority to promulgate administrative regulations pertaining to grants. This administrative regulation establishes the apportionment of financial assistance refunds from institutions and repayment from students due to the KHEAA grant programs.
History: 15 Ky.R. 1607; eff. 2-3-1989; 18 Ky.R. 3483; eff. 8-1-1992; 21 Ky.R. 448; eff. 10-6-1994; 27 Ky.R. 3308; eff. 8-15-2001; 41 Ky.R. 834; 1497; eff. 2-6-2015; Crt eff. 9-28-2018; Crt eff. 2-19-2025.

11 KAR 5:180 Records and reports {#sec-11-kar-5-180 omnilex-key=us-ky-regs-official--title-11--11 KAR 5:180}

Section 1. Records and Reports. An educational institution shall:

(1) Establish an organized system of records pertaining to KHEAA grant recipient eligibility;

(2) Maintain these records for a period of not less than three (3) years after the award year in which the recipient ceased enrollment; and

(3) Upon request, make available to the authority:

(a) All records relied upon by that institution to certify that any recipient of funds from the authority is an eligible student; and

(b) Information necessary to verify that the institution has complied with:

11 KAR Chapter 5;
The federal act, as it is defined in 11 KAR 5:001, Section 1(13); and
Representations and requirements contained in its agreement with the authority.

History

RELATES TO: KRS 164.740-164.764, 164.780, 164.785
STATUTORY AUTHORITY: KRS 164.748(4)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.748(4) requires the Kentucky Higher Education Assistance Authority or KHEAA to promulgate administrative regulations pertaining to the awarding of grants, scholarships, and honorary scholarships as provided in KRS 164.740 to 164.785. The Kentucky Higher Education Assistance Authority administers grant programs to provide financial assistance to students to attend Kentucky educational institutions. This administrative regulation establishes recording and reporting requirements for educational institutions.
History: 15 Ky.R. 1609; eff. 2-3-1989; 16 Ky.R. 2690; eff. 8-9-1990; 18 Ky.R. 3485; eff. 8-1-1992; 21 Ky.R. 449; eff. 10-6-1994; 29 Ky.R. 2498; 2863; eff. 6-3-2003; Crt eff. 9-28-2018; Crt eff. 2-19-2025.

11 KAR 5:200 Go Higher Grant Program {#sec-11-kar-5-200 omnilex-key=us-ky-regs-official--title-11--11 KAR 5:200}

Section 1. Definitions.

(1) "Demonstrated financial need" means an expected family contribution (EFC) of no more than 150 percent of the CAP Grant EFC as set forth in 11 KAR 5:145, Section 1.

(2) "Eligible institution" is defined by KRS 164.740(4).

(3) "Eligible student" is defined by KRS 164.740(6).

(4) "Half-time enrollment" means enrollment in a minimum of six (6) hours of course work.

Section 2. Eligibility Criteria. In order to be eligible to receive grant funds under this program, an individual shall:

(1) Be age twenty-four (24) or older by July 1 prior to the start of the first term during which the award will be used;

(2) Be enrolled at an eligible institution;

(3) Have enrollment of less than half-time during the first semester in which the grant is awarded;

(4) Have demonstrated financial need;

(5) Be enrolled as an undergraduate student;

(6) Not have earned a first baccalaureate degree;

(7) Be a Kentucky resident;

(8) Be a U.S. citizen, national or permanent resident;

(9) Not be incarcerated at either the time of application or receipt of an award; and

(10) Not be:

(a) In default on any loan under Title IV of the federal act, codified as 20 U.S.C. 1070 to 1099, unless eligibility has been reinstated;

(b) Liable for any amounts that exceed annual or aggregate limits on any loan under Title IV of the federal act, codified as 20 U.S.C. 1070 to 1099; and

Section 3. Application Procedure.

(1) In order for an eligible student to be considered for an award under this program, the student shall complete:

(a) The Go Higher Grant Program Application incorporated by reference in 11 KAR 4:080; and

(b) The Free Application for Federal Student Aid (FAFSA) as required by 11 KAR 4:080, Section 2.

(2) The priority deadline for applications shall be July 1. Applications shall be accepted after that date with awards made until funds are exhausted.

Section 4. Awards.

(1) An eligible student recipient shall receive an award under this program for only one (1) academic year.

(2) The maximum award amount under this program shall be $1,000 per recipient.

(3) The amount of the award under this program for the first semester of the recipient's enrollment shall be equal to:

(a) The cost of tuition at the participating institution, not to exceed the maximum award amount; and

(b) A book allowance of fifty (50) dollars per credit hour of enrollment, not to exceed the maximum award amount.

(4) The amount of the award under this program for the second semester of the recipient's enrollment, if any, shall be equal to the difference between the maximum award amount under this program and the amount received during the recipient's first semester of enrollment up to the cost of tuition and book allowance.

(5) In making awards under this program, priority shall be given to eligible applicants who have received a General Education Development (GED) Certificate.

Section 5. Disbursement Procedures.

(1) Grant funds shall be disbursed by the authority to the participating institution in the form of a single check, made payable to the participating institution, or by electronic funds transfer delivered to the participating institution for subsequent delivery for application to the account of the award recipient.

(2) Within thirty (30) days following receipt of the eligibility verification file, the disbursement of grant funds by the authority to the participating institution shall be made for subsequent application to the account of the award recipient.

Section 6. Reporting and Repayment Requirements.

(1) The school shall verify enrollment to the Authority after the time for adding or dropping classes at the institution has passed.

(2) If a grant recipient officially or unofficially withdraws from or is expelled by an institution before the first day of classes of the award period, the award shall be deemed an over-award and a full refund or repayment of the award shall be required.

(3) If the institution is unable to document the student's last date of attendance, any grant disbursement for that award period shall be subject to full refund and repayment.

(4) If, at any time, a grant recipient's enrollment is terminated with no assessment of tuition and fees by the institution, the full grant award shall be subject to cancellation, if not yet disbursed, or refund and repayment if the grant has already been disbursed.

(5) The institution shall remit to the authority the amount of funds allocated from the refund amount to the financial assistance programs administered by the authority as soon as possible but no later than thirty (30) days after the end of the term in which the student ceased to be enrolled.

(6) If a refund is due from the participating institution or a repayment is due from a student, the participating institution shall transmit to the authority the refund and shall report:

(a) The student's name and Social Security number;

(b) The reason for the refund or repayment;

(d) The academic term and award period; and

(e) The calculation used for determining the refund or repayment.

(7) Failure of the institution to make restitution if required shall, without precluding other remedies, be deemed cause for limitation, suspension or termination of the participation of the institution in accordance with 11 KAR 4:020.

History

RELATES TO: KRS 164.740, 164.744(2), 164.753(4), 164.7535, 164.780, 164.785
STATUTORY AUTHORITY: KRS 164.746(6), 164.748(4), 164.7535
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.748(4) requires KHEAA to promulgate administrative regulations pertaining to the awarding of grants, scholarships, and honorary scholarships as provided in KRS 164.740 to 164.7891. This administrative regulation establishes application procedures and selection criteria for the administration of the Go Higher Grant Program.
History: 33 Ky.R. 2226; 2927; eff. 4-6-2007; 34 Ky.R. 1761; 2073; eff. 4-4-2008; 35 Ky.R. 949; eff. 1-5-2009; 2315; 36 Ky.R. 13; eff. 7-13-2009; TAm eff. 4-27-2016; Crt eff. 9-28-2018; Crt eff. 2-19-2025.

Chapter 7 Incentive Loan Program

11 KAR 7:010 Incentive Loan Program; mathematics and science {#sec-11-kar-7-010 omnilex-key=us-ky-regs-official--title-11--11 KAR 7:010}

Section 1. Definitions.

(1) "Public school" means a common school operated under the laws of the Commonwealth of Kentucky.

(2) "Semester" means a period of about eighteen (18) weeks, which usually makes up one-half (1/2) of a public school year or one-half (1/2) of a participating institution's academic year.

(3) "Qualified teaching service" means employment in a critical shortage field in grades seven (7) through twelve (12) in a public school in a position requiring a Kentucky teacher's certificate for a major portion of a school day for at least seventy (70) days during a semester.

(4) "Participating institution" means an institution of higher education located in Kentucky, which is approved by the State Board of Education to offer teacher education programs, and which has in force an agreement with the authority providing for administration of this program.

(5) "Critical shortage field" means the teaching fields of mathematics and science specified in KRS 164.768.

(6) "Qualified teacher education program" means a program of study in a mathematics or science major or area of concentration leading to teacher certification in one (1) of the critical shortage fields.

Section 2. The Kentucky Higher Education Assistance Authority (authority) shall, to the extent of appropriations for such purpose, award math/science incentive loans (loans) to persons enrolled or accepted for enrollment in a Qualified Teacher Education Program on a full-time basis at a participating institution approved by the State Board of Education to offer Qualified Teacher Education Programs, who declare an intention to teach in one (1) of the critical shortage fields in the public schools of the Commonwealth, and who meet the eligibility requirements set forth herein. Persons already possessing certification in one (1) of the critical shortage fields may be awarded loans to pursue certification in a different critical shortage field only upon a statement by the local school district superintendent of exceptional need for a teacher in that field.

Section 3. Teacher Recertification Eligibility.

(1) Up to thirty (30) percent of the annual appropriation for KRS 164.768 will be loaned to certified teachers who do not possess certification in one of the critical shortage fields, who have been admitted to a qualified teacher education program, approved by the State Board of Education, at a participating institution as a summer school student, and who plan to complete requirements for certification in the specified critical shortage field. An individual who owes repayment of a grant or work-study award, or who is in default in repayment of any loan owed to the authority, is not eligible to receive a loan until such financial obligations to the authority are satisfied, provided, however, that ineligibility for this reason may be waived, at the recommendation of a designated staff review committee for cause.

(2) Eligible applicants for such loans must already possess a Kentucky teacher certificate.

(3) For first time eligible applicants, priority for such loans will be given in rank order established on the basis of the following weighted criteria:

(a) Relative need for teachers within the critical shortage field as determined by the Department of Education or a survey of local school district superintendents. Weight: maximum thirty (30) points out of 100.

(b) The applicant's cumulative grade point average for undergraduate study. Weight: maximum twenty-five (25) points for grade point averages in the 3.5 to 4.0 range; maximum twenty (20) points for averages in the 3.0 to 3.4 range; and maximum fifteen (15) points for averages in the 2.5 to 2.9 range.

(c) National Teacher Examination (NTE) or Graduate Record Examination (GRE) scores. Scores of applicants from minority population groups will be measured relative to the average scores for such minority population groups, when available. Weight: maximum twenty (20) points for scores in the ninety (90) to ninety-nine (99) percentile range; maximum fifteen (15) points for scores in the eighty (80) to eighty-nine (89) percentile range; maximum ten (10) points for scores in the seventy (70) to seventy-nine (79) percentile range.

(d) Consideration to teachers teaching out of field in one of the critical shortage fields on or before December 1 of the year preceding the year for which the award is made. Weight: maximum fifteen (15) points out of 100.

(e) Proximity to completion of certification requirements in one of the critical shortage fields. Weight: maximum ten (10) points out of 100.

(4) Once all the criteria in subsection (3) of this section have been evaluated and two (2) or more applicants are equally ranked, selection between the applicants will be made on the basis of the date the application is received by the participating institution.

(5) Certified teachers, who received a loan under this program pursuant to prior administrative regulations, to pursue certification in a critical shortage field on a part-time basis during the regular school year, shall be eligible to receive additional loans in accordance with this administrative regulation to complete such certification. Such loans shall not exceed tuition and institutional fees payable by such a recipient in a qualified teacher education program.

(6) The amount of a summer loan under this section for a recipient shall not exceed the total cost of attendance determined by the participating institution. The maximum summer loan for teachers enrolled full time in a qualified teacher education program shall be $833 per summer session. The aggregate maximum for loans under this section shall be $2500.

Section 4. Student Certification Eligibility.

(1) At least seventy (70) percent of the annual appropriation for KRS 164.768 will be used to provide incentive loans to persons enrolled full time as a sophomore, junior, or senior in a qualified teacher education program approved by the State Board of Education at a participating institution with the intention of obtaining certification to teach in one of the critical shortage fields. An individual who owes repayment of a grant or work-study award, or who is in default in repayment of any loan owed to the authority, is not eligible to receive a loan until such financial obligations to the authority are satisfied, provided, however, that ineligibility for this reason may be waived, at the sole discretion of the executive director of the authority, for cause.

(2) Eligible applicants for loans must have a grade point average of at least 2.5 computed on a 4.0 scale.

(3) The participating institution shall establish a screening committee to verify that applicants from that institution are eligible for a loan under this section. The committee will certify that eligible loan applicants have a reasonable chance for completing the qualified teacher education program in the selected major. The committee shall rank all eligible first-time applicants based on the following criteria:

(a) Relative need for teachers within the critical shortage fields as determined by the Department of Education or a survey of local district superintendents. Weight: maximum fifty (50) points.

(b) Cumulative high school grade point average or, for persons holding a bachelor's degree, cumulative undergraduate grade point average. Weight: maximum thirty (30) points for averages in the 3.5 to 4.0 range; maximum twenty (20) points for averages in the 3.0 to 3.4 range; and maximum ten (10) points for averages in the 2.5 to 2.9 range.

(c) College entrance examination score or, for persons holding a bachelor's degree, Graduate Record Examination (GRE) score. Scores of applicants from minority population groups will be measured relative to the norms for such minority population groups, when available. Weight: maximum twenty (20) points for scores in the ninety (90) to ninety-nine (99) percentile range; maximum fifteen (15) points for scores in the eighty (80) to eighty-nine (89) percentile range; maximum ten (10) points for scores in the seventy (70) to seventy-nine (79) percentile range.

(4) Once all criteria in subsection (3) of this section have been evaluated and two (2) or more applicants are equally ranked, priority shall be given first to graduates of Kentucky high schools and second to Kentucky residents, and then based upon the date the application is received by the participating institution

(5) The amount of loan under this section for a student shall not exceed the student's total cost of attendance determined by the participating institution. The maximum amount of loan for recipients under this section shall be $1,250 per semester or $2,500 per academic year. Summer school loans shall not exceed $833, and shall be in addition to the academic year maximum. The aggregate maximum for loans under this section shall be $7,500.

Section 5. Application. Applications for loans will be received, evaluated and verified by the screening committee at the participating institution where the applicant intends to enroll. Applications must be submitted by a deadline set annually by the authority. The participating institution shall forward the applications, ranking, and supporting documentation of the eligible applicants to the authority. Loans for summer session attendance shall be made upon separate application.

Section 6. Renewal. Applicants who have successfully completed one (1) or more summer sessions or semesters in the program, maintain a 2.5 grade point average computed on a 4.0 scale and make normal progress toward completion of certification requirements in one (1) of the critical shortage fields, as determined by the participating institution, qualify for subsequent loans, upon application, and shall receive priority over new applicants. Loans pursuant to Section 3 of this administrative regulation shall be renewed for a maximum of two (2) summer sessions.

Section 7. Use of Loan Proceeds. Proceeds of a loan under Sections 3 or 4 of this administrative regulation shall be used by the recipient first for payment of tuition and other institutional charges payable by the recipient to the participating institution, and thereafter for other educational related expenses.

Section 8. Reallocation of Funds.

(1) principal and interest paid by recipients, and any money not utilized under Section 3 of this administrative regulation shall be used to make additional loans under Section 4 of this administrative regulation.

(2) In the event that funds are not sufficient to award all applicants, loans shall first be awarded to those qualifying applicants who previously received loans. In the event that funds are insufficient to award all prior recipients who are qualified applicants, then loans shall be prorated in accordance with the cumulative amount previously received by the applicant. If funds are sufficient to award new applicants, an award shall be made first to the applicant with the highest score on the selection criteria and, thereafter, in descending order to persons having lower scores until all available funds are exhausted.

Section 9. Disbursements. Disbursements of loans shall be made at the beginning of each semester or summer session and such disbursement shall be evidenced by a promissory note, prescribed by the authority, in which the loan recipient shall agree to repay the loan or render qualified teaching service in lieu thereof.

Section 10. Notifications. Recipients shall notify the authority within thirty (30) days of:

(1) Change in enrollment status;

(2) Cessation of enrollment in a qualified teacher education program;

(3) Employment in a qualified teaching service position; or

(4) Change of address.

Section 11. Withdrawals. Loan recipients who, prior to completion, cease to be enrolled on a full-time basis in a qualified teacher education program at a participating institution, shall immediately become liable for the repayment to the authority of the sum of all loans received plus interest accrued thereon unless such recipient has an approved deferment pursuant to 11 KAR 7:020. For purposes of this section, teachers seeking recertification in accordance with Section 3 of this administrative regulation are considered enrolled on a full-time basis for so long as they continue to enroll full time in consecutive summer sessions while making normal progress toward completion of certification requirements as determined by the participating institution.

Section 12. Repayment. Recipients who do not begin employment in a qualified teaching service position within the six (6) month period following completion of a qualified teacher education program in a participating institution (excluding periods of deferment pursuant to 11 KAR 7:020) shall immediately become liable to the authority for repayment of principal and interest accrued, pursuant to the earliest promissory note then outstanding. In each semester thereafter, during which a recipient does not render qualified teaching service, repayment of an additional promissory note shall become due, proceeding sequentially from the promissory note having the earliest date to the most recent date.

Section 13. Repayment Schedule. Written notification of demand shall be sent by the authority to the loan recipient's last known address and shall be effective upon mailing. The authority may agree, in its sole discretion, to accept repayment in installments in accordance with a schedule established by the authority. In the event that more than one (1) promissory note has come due for repayment and remains unpaid, then payments shall first be applied to the earliest unpaid promissory note. Payments shall be applied first to accrued interest and then to principal.

Section 14. Cancellation.

(1) In order to receive cancellation of a promissory note and the interest thereon, a loan recipient must render qualified teaching service in a public school during a semester. One such promissory note shall be cancelled for each semester during which qualified teaching service is verified to the authority. Such cancellations of promissory notes shall be in sequential order beginning with the earliest promissory note.

(2) In the event that a recipient has received loans or scholarships from more than one (1) program administered by the authority, which require a period of qualified teaching service for repayment or cancellation, such teaching requirements shall not be fulfilled concurrently. Unless the authority determines otherwise for cause, loans or scholarships from more than one (1) program shall be repaid or cancelled by qualified teaching service in the same order in which they were received.

(3) Verification of qualified teaching service shall be submitted to the authority in writing, signed by the local school district superintendent or building principal, within thirty (30) days of the date a loan recipient completes such qualified teaching service.

Section 15. Interest. The interest rate on loans made under KRS 156.611 or 164.768 after July 1, 1986, shall be twelve (12) percent per annum simple interest. The interest rate shall remain fixed for the duration of the loan. Interest accruing on the unpaid principal of each promissory note shall be computed from the date of disbursement of the respective promissory note, and such interest shall continue to accrue until the promissory note is paid in full pursuant to Sections 11 or 12 of this administrative regulation or cancelled pursuant to Section 14 of this administrative regulation. In the event that the loan is not repaid or cancelled in accordance with the terms of the promissory note and related repayment schedule, if any, and judgment is rendered on the debt, then the annual interest rate shall, from the date of such judgment, not exceed four (4) percent in excess of the discount rate on ninety (90) day commercial paper in effect at the Federal Reserve Bank in the Federal Reserve District where the transaction is consummated or nineteen (19) percent, whichever is less, provided that it shall not be less than the face rate of the promissory note.

Section 16. Records. A participating institution shall maintain complete and accurate records pertaining to the eligibility, enrollment and progress of students receiving aid under this program and the disbursement of funds and institutional charges as may be necessary to audit the disposition of funds hereunder. Such records shall be maintained for at least five (5) years after the student ceases to be enrolled at the participating institution.

Section 17. Refunds. A participating institution shall refund to the authority, within forty (40) days of a recipient's last date of attendance, any amount attributable to this program which is determined to be due under the institution's refund policy.

Section 18. Information Dissemination and Recruitment. The authority shall disseminate information through high school counselors and school superintendents about this program to potential recipients. Participating institutions shall provide assurances that program information will be disseminated to freshmen and sophomores enrolled at that institution. Participating institutions shall actively recruit students from minority population groups for participation in this program.

History

RELATES TO: KRS 164.768
STATUTORY AUTHORITY: KRS 164.748(4), 164.768(10)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.768 establishes the math/science incentive loan program for awarding incentive loans to persons declaring an intention to serve and who actually render service in the critical teacher shortage fields of mathematics and science. Section 39 of House Bill 6, enacted in the 1985 extraordinary session of the General Assembly, amended KRS 156.611 to transfer administration of this program from the Department of Education to the Kentucky Higher Education Assistance Authority. It is necessary to the administration of the program that the Assistance Authority promulgate this administrative regulation to prescribe rules for the administration of the program. Section 1 of House Bill 74, enacted in the 1988 regular session of the General Assembly, repealed KRS 156.611 and reenacted those provisions as KRS 164.768. This amendment is necessary and intended only to correct the statutory citation.
History: 12 Ky.R. 1447; eff. 3-4-1986; 13 Ky.R. 21; 499; eff. 8-12-1987; 1607; eff. 4-14-1987; 17 Ky.R. 2007; eff. 2-7-1991; Crt eff. 9-28-2018; Crt eff. 2-28-2025.

11 KAR 7:020 Deferment {#sec-11-kar-7-020 omnilex-key=us-ky-regs-official--title-11--11 KAR 7:020}

Section 1. Definitions. Unless otherwise specified, the words and phrases used herein shall have the same meaning as set forth in 11 KAR 7:010. "Deferment" means a temporary waiver of the obligation of a math/science incentive loan recipient to make payments to the authority, pursuant to one (1) or more promissory notes executed between the recipient and the authority, which is granted by the authority, for a specified period of time, upon a showing of cause by the recipient.

Section 2. Request for Deferment. The recipient must request a deferment in writing by submitting complete and accurate information on a form prescribed by the authority. The recipient's submission of a request for deferment shall constitute authorization for the authority to request and receive such verification of facts represented by the recipient as may be deemed necessary by the authority.

Section 3. Effect on Repayments. During a deferment, no principal or interest repayments shall be required but interest shall continue to accrue on the unpaid principal balance owed by the recipient. Nothing contained herein shall require the authority to grant a deferment if such deferment would legally impair the ultimate recovery of the principal and accrued interest otherwise owed by the recipient. If, during a deferment, the recipient resumes full-time enrollment in a teacher education program leading to certification in a critical shortage field at a participating institution or renders qualified teaching service, then the deferment shall nullify the commencement of repayment, such that any promissory note so deferred may be subsequently cancelled in accordance with KRS 164.768 and 11 KAR 7:010.

Section 4. Types of Deferments. The following deferments may be granted by the authority:

(1) Enrollment deferment. A deferment granted to a recipient who is enrolled on at least a half-time basis at a business school, college, vocational school or school of nursing (as those terms are defined in KRS 164.740) in the United States. The recipient must provide to the authority, at least annually, evidence of such enrollment on properly completed forms provided by the authority.

(2) Disability deferment. A deferment granted to a recipient who is temporarily totally disabled and, therefore, unable to obtain any full-time employment or to attend school; or, a deferment granted to a recipient who is unable to obtain any full-time employment or attend school due to the temporary total disability of the recipient's spouse who requires continuous (twenty-four (24) hour) nursing or similar care by the recipient. For purposes of this deferment, a recipient, or the spouse of a recipient, is temporarily totally disabled if he/she suffers an injury or illness which necessitates an extended or indefinite period of recovery which can be expected to preclude gainful employment or school attendance and, in the case of a recipient's spouse, he/she is not confined to a hospital, nursing home, intermediate care facility, or similar institution. The recipient must provide to the authority a statement from a licensed physician certifying that the recipient or spouse is temporarily totally disabled in accordance with the preceding terms and conditions. The recipient is solely responsible for securing the physician's certifications. This deferment may, at the authority's discretion, be granted for a period not to exceed three (3) years, subject to annual review of a physician's certification. After the third year of any deferment, pursuant to this subsection, the authority may, in its sole discretion, cancel the debt.

(3) Unemployment deferment.

(a) A recipient seeking, but unable to obtain, a qualified teaching service position within six (6) months following completion of a qualified teacher education program at a participating institution may be granted a single deferment for a period not to exceed one (1) year. The recipient must have applied for a qualified teaching service position with at least three (3) public school districts and must not have refused an offer of employment in a qualified teaching service position in such public school districts or in any other public school districts to which the recipient may have applied, and must provide the authority a signed statement which sets forth:

The recipient's current address;
The names of public school districts to which the recipient has applied for qualified teaching service employment; and
The recipient's agreement to notify the authority when he/she obtains full-time employment in a qualified teaching service position; or

(b) A recipient seeking, but unable to obtain, any full-time (at least thirty (30) hours per week) employment may be granted a single deferment for a period not to exceed one (1) year. The recipient must provide, on the form prescribed by the authority, a signed statement which sets forth:

The recipient's current address;
Certification that the recipient has registered with a public or private employment agency, if one is accessible, specifying the name and address of such agency; and
The borrower's agreement to notify the authority within thirty (30) days of a date upon which he/she obtains full-time employment. If full-time employment is obtained at any time during the period of a deferment approved pursuant to this section, such deferment shall be immediately terminated.

(c) The immediately preceding subsections of this section are alternative ways to qualify for a single deferment for a period not to exceed one (1) year. Pursuant to paragraph (a) of this subsection, a recipient, who is seeking, but unable to obtain, a qualified teaching service position, may receive a deferment even if employed full-time in another type of position. Pursuant to paragraph (b) of this subsection, a recipient, who is not actively seeking a qualified teaching service position, may receive a deferment only if actively seeking and unable to obtain any type of full-time employment.

(4) Parenting deferment. A deferment may be granted by the authority when a recipient interrupts qualified teaching service or enrollment in a qualified teacher education program at a participating institution under an approved leave of absence for purposes of rearing a preschool age child. The borrower must provide to the authority a statement, signed by an authorized representative of the public school district or participating institution, evidencing that such a leave of absence has been approved for the recipient. This deferment shall remain in effect during the period of the leave of absence not to exceed two (2) years. The recipient is solely responsible for securing, at least annually, the required verification of an approved leave of absence.

(5) Hardship deferment. If enrollment in a teacher education program leading to certification in a critical shortage field or employment in a qualified teaching service position is temporarily interrupted due to circumstances beyond the recipient's control, including, but not limited to, illness, accident or death in the family, after which the recipient intends to resume such enrollment or qualified teaching service position, then the authority may determine that a hardship exists and may grant a single deferment of a period not in excess of one (1) year.

(6) Qualified teaching service deferment.

(a) Deferments may be granted, from time to time, to a recipient who, due to current employment in a qualified teaching service position, may reasonably be expected, solely with the passage of six (6) months or less time, to qualify for cancellation benefits pursuant to 11 KAR 8:010.

(b) In the event that a recipient has received loans or scholarships from more than one (1) program administered by the authority, which require a period of qualified teaching service for repayment or cancellation, and the recipient is either:

Obligated to concurrently make cash payments on the math/science incentive loan and another such program; or
Performing qualified teaching service to fulfill the requirement of another such program; then a deferment of repayment of the math/science incentive loan may be granted during the period in which the recipient is making payments or performing qualified teaching service in accordance with the requirements of the other program.

History

RELATES TO: KRS 164.768
STATUTORY AUTHORITY: KRS 164.748(4), 164.768
NECESSITY, FUNCTION, AND CONFORMITY: KRS 156.611, repealed and reenacted as KRS 164.768 by Section 1 of House Bill 74 of the 1988 regular session of the General Assembly, establishes the math/science incentive loan program and provides that the Kentucky Higher Education Assistance Authority (authority) may permit deferment of repayment for cause. This administrative regulation defines "deferment" and establishes conditions under which specified types of deferments may be approved by the authority. This amendment is necessary and is intended only to correct the statutory citation.
History: 13 Ky.R. 93; eff. 8-12-1987; 1611; eff. 4-14-1987; 17 Ky.R. 2010; eff. 2-7-1991; Crt eff. 9-28-2018; Crt eff. 2-28-2025.

Chapter 8 Teacher Scholarship Loan Program

11 KAR 8:010 Teacher Loan Program {#sec-11-kar-8-010 omnilex-key=us-ky-regs-official--title-11--11 KAR 8:010}

Section 1. Definitions.

(1) "Public school" means a common school operated under the laws of the Commonwealth of Kentucky.

(2) "Semester" means a period of about eighteen (18) weeks, which usually makes up one-half (1/2) of a public school year or one-half (1/2) of a participating institution's academic year.

(3) "Qualified teaching service" means employment in a public school in a position requiring a Kentucky Teacher's Certificate for a major portion of a school day for at least seventy (70) days during a semester.

Section 2. The Kentucky Higher Education Assistance Authority (authority) shall, to the extent of appropriations for such purpose, award teacher loans to persons enrolled or accepted for enrollment on a full-time basis at participating institutions of higher education, approved by the State Board of Education to offer teacher education programs, who declare an intention to enter the teaching profession in the public schools of the Commonwealth, and who meet the eligibility requirements set forth herein.

Section 3. Eligibility Criteria. Graduates of a high school, located in Kentucky, who rank academically in the top ten (10) percent of their graduating class, or who score at or above the 80th percentile on a test required for admission to the Commonwealth's public institutions of higher education, and who have not previously received a baccalaureate degree, shall be eligible to apply for a teacher loan. An individual who owes repayment of a grant or work-study award, or who is in default in repayment of any loan owed to the authority, is not eligible to receive a teacher loan until all such financial obligations to the authority are satisfied, provided, however, that ineligibility for this reason may be waived, at the recommendation of a designated staff review committee for cause.

Section 4. Selection Criteria. Recipient selection will be made on the basis of the following weighted criteria: rank in class (thirty (30) percent), grade point average (forty (40) percent), percentile score on the test required for admission to the Commonwealth's public institutions of higher education (thirty (30) percent). (Test scores of applicants from minority population groups will be measured relative to the scores of such minority population groups.) If funds are insufficient to award all applicants, the loans shall first be awarded to those qualifying applicants who previously received scholarships. If funds are insufficient to award all prior recipients who are qualified applicants, then loans shall be prorated in accordance with the cumulative amount previously received by such applicants. If funds are sufficient to award new applicants, an award shall be made first to the applicant with the highest score on the selection criteria and, thereafter, in a descending order to persons having lower scores until all available funds are awarded. Once all the criteria have been evaluated and two (2) or more applicants are equally ranked, selection between the applicants will be made on the basis of the date the application is received by the authority.

Section 5. Renewal. Teacher loans shall be renewed annually upon application for a maximum of three (3) years of undergraduate study for those who maintain at least the equivalent of a 2.5 cumulative grade point average on a scale of 4.0 and provided that the recipient, when first eligible, enrolls in a teacher education program and, thereafter, continues to be enrolled on a full-time basis in such a program. Awards for summer school attendance shall be made upon separate application.

Section 6. Award Maximums. The maximum teacher loan award for a summer session shall be $1,250; for a semester shall be $2,500; or, for an academic year (exclusive of a summer session) shall be $5,000. The aggregate maximum of teacher loan awards shall not exceed $20,000 per individual. Awards shall not exceed the student's total cost of attendance as determined by the participating institution.

Section 7. Disbursements. Disbursement of teacher loans shall be made at the beginning of each semester or summer session and each such disbursement shall be evidenced by a promissory note, prescribed by the authority, in which the loan recipient shall agree to repay the loan funds or render qualified teaching service in lieu thereof.

Section 8. Notifications. Recipients shall notify the authority within thirty (30) days of:

(1) Change in enrollment status;

(2) Cessation of enrollment in a teacher education program;

(3) Employment in a qualified teaching service position; or,

(4) Change of address.

Section 9. Withdrawals. Loan recipients who, prior to completion, cease to be enrolled on a full-time basis in a teacher education program at a participating institution, shall immediately become liable for the repayment to the authority of the sum of all teacher loan funds received plus interest accrued thereon unless such recipient has an approved deferment pursuant to 11 KAR 8:020.

Section 10. Repayment. Recipients who do not begin employment in a qualified teaching service position within the six (6) month period following completion of a teacher education program in a participating institution (excluding periods of deferment pursuant to 11 KAR 8:020) shall immediately become liable to the authority for repayment of principal and interest accrued, pursuant to the earliest promissory note then outstanding. In each semester thereafter, during which a recipient does not render qualified teaching service, repayment of an additional promissory note shall become due, proceeding sequentially from the promissory note having the earliest date to the most recent date.

Section 11. Repayment Schedule. Written notification of demand for repayment shall be sent by the authority to the loan recipient's last known address and shall be effective upon mailing. The authority may agree, in its sole discretion, to accept repayment in installments in accordance with a schedule established by the authority. In the event that more than one (1) promissory note has come due for repayment and remains unpaid, then payments shall first be applied to the earliest unpaid promissory note. Payments shall be applied first to accrued interest and then to principal.

Section 12. Cancellation.

(1) In order to receive cancellation of a promissory note and the interest accrued thereon, a loan recipient must render qualified teaching service in a public school during a semester. One (1) such promissory note shall be cancelled for each semester during which qualified teaching service is verified to the authority. Such cancellations of promissory notes shall be in sequential order beginning with the earliest promissory note.

(3) Verification of qualified teaching service shall be submitted to the authority in writing, signed by the local school district superintendent or building principal, within thirty (30) days of the date a scholarship recipient completes such qualified teaching service.

Section 13. Interest. The interest rate on loan funds shall be twelve (12) percent per annum simple interest. Interest accruing on the unpaid principal of each promissory note shall be computed from the date of disbursement of the respective promissory note, and such interest shall continue to accrue until the promissory note is paid in full pursuant to Section 11 of this administrative regulation or cancelled in full pursuant to Section 12 of this administrative regulation. In the event that the loan is not repaid or cancelled in accordance with the terms of the promissory note and related repayment schedules, if any, and judgment is rendered on the debt, then the annual interest rate shall, from the date of such judgment, not exceed four (4) percent in excess of the discount rate on ninety (90) day commercial paper in effect at the Federal Reserve Bank in the Federal Reserve District where the transaction is consummated or nineteen (19) percent, provided that it shall not be less than the face rate of the promissory note.

Section 14. Records. A participating institution shall maintain complete and accurate records pertaining to the eligibility, enrollment and progress of students receiving aid under this program and the disbursement of funds and institutional charges as may be necessary to audit the disposition of funds hereunder. Such records shall be maintained for at least five (5) years after the student ceases to be enrolled at the institution.

Section 15. Refunds. A participating institution shall refund to the authority, within forty (40) days of a recipient's last date of attendance, any amount attributable to this program which is determined to be due under the institution's refund policy.

Section 16. Information Dissemination and Recruitment. The authority shall disseminate information through high school counselors and school superintendents about this program to potential recipients. Participating institutions shall provide assurances that program information will be disseminated to freshmen and sophomores enrolled at that institution. Participating institutions shall actively recruit students from minority population groups for participation in this program.

History

RELATES TO: KRS 164.770
STATUTORY AUTHORITY: KRS 164.748(4), 164.770
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.770 established the Teacher Loan Program to encourage academically talented students to become teachers in the public schools of the Commonwealth. This administrative regulation prescribes rules for the administration of the Teacher Loan Program. 11 KAR 8:030 establishes a new program of teacher scholarships pursuant to House Bill 799 (1990 RS), Part I, F., 46., p. 52 and the corresponding budget memorandum. This amendment is necessary to rename the program established pursuant to KRS 164.770 to avoid confusion.
History: 13 Ky.R. 94; 503; eff. 8-12-1986; 1613; 1853; eff. 4-14-1987; 16 Ky.R. 2694; eff. 8-9-1990; Crt eff. 9-28-2018; Crt eff. 2-28-2025.

11 KAR 8:020 Deferment of teacher loans {#sec-11-kar-8-020 omnilex-key=us-ky-regs-official--title-11--11 KAR 8:020}

Section 1. Definitions. Unless otherwise specified, the words and phrases used herein shall have the same meaning as set forth in 11 KAR 8:010. "Deferment" means a temporary waiver of the obligation of a teacher loan recipient to make payments to the authority, pursuant to one or more promissory notes executed between the recipient and the authority, which is granted by the authority, for a specified period of time, upon a showing of cause by the recipient.

Section 3. Effect on Repayments. During a deferment, no principal or interest repayments shall be required but interest shall continue to accrue on the unpaid principal balance owed by the recipient. Nothing contained herein shall require the authority to grant a deferment if such deferment would legally impair the ultimate recovery of the principal and accrued interest otherwise owed by the recipient. If, during a deferment, the recipient resumes full-time enrollment in a teacher education program at a participating institution or renders qualified teaching service, then the deferment shall nullify the commencement of repayment, such that any promissory note so deferred may be subsequently cancelled in accordance with KRS 164.770 and 11 KAR 8:010.

Section 4. Types of Deferments. The following deferments may be granted by the authority:

(3) Unemployment deferment.

(a) A recipient seeking, but unable to obtain, a qualified teaching service position within six (6) months following completion of a teacher education program at a participating institution may be granted a single deferment for a period not to exceed one (1) year. The recipient must have applied for a qualified teaching service position with at least three (3) public school districts and must not have refused an offer of employment in a qualified teaching service position in such public school districts or in any other public school districts to which the recipient may have applied, and must provide the authority a signed statement which sets forth:

The recipient's current address;
The names of public school districts to which the recipient has applied for qualified teaching service employment; and
The recipient's agreement to notify the authority when he/she obtains full-time employment in a qualified teaching service position; or

The recipient's current address;
Certification that the recipient has registered with a public or private employment agency, if one is accessible, specifying the name and address of such agency; and
The borrower's agreement to notify the authority within thirty (30) days of a date upon which he/she obtains full-time employment. If full-time employment is obtained at any time during the period of a deferment approved pursuant to this section, such deferment shall be immediately terminated.

(4) Parenting deferment. A deferment may be granted by the authority when a recipient interrupts qualified teaching service or enrollment in a teacher education program at a participating institution under an approved leave of absence for purposes of rearing a preschool age child. The borrower must provide to the authority a statement, signed by an authorized representative of the public school district or participating institution, evidencing that such a leave of absence has been approved for the recipient. This deferment shall remain in effect during the period of the leave of absence not to exceed two (2) years. The recipient is solely responsible for securing, at least annually, the required verification of an approved leave of absence.

(5) Hardship deferment. If enrollment in a teacher education program or employment in a qualified teaching service position is temporarily interrupted due to circumstances beyond the recipient's control, including, but not limited to, illness, accident or death in the family, after which the recipient intends to resume such enrollment or qualified teaching service position, then the authority may determine that a hardship exists and may grant a single deferment of a period not in excess of one (1) year.

(6) Qualified teaching service deferment.

Obligated to concurrently make cash payments on the teacher loan and another such program; or
Performing qualified teaching service to fulfill the requirement of another such program; then a deferment of repayment of the teacher loan may be granted during the period in which the recipient is making payments or performing qualified teaching service in accordance with the requirements of the other program.

History

RELATES TO: KRS 164.770
STATUTORY AUTHORITY: KRS 164.748(4), 164.770
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.770 establishes the Teacher Loan Program and provides that the Kentucky Higher Education Assistance Authority (authority) may permit deferment of repayment for cause. This administrative regulation defines "deferment" and establishes conditions under which specified types of deferments may be approved by the authority. 11 KAR 8:030 establishes a new program of teacher scholarships pursuant to House Bill 799 (1990 RS), Part I, F., 46., p. 52 and the corresponding budget memorandum. This amendment is necessary to rename the program established pursuant to KRS 164.770 to avoid confusion.
History: 13 Ky.R. 96; eff. 8-12-1986; 1615; eff. 4-14-1987; 16 Ky.R. 2696; eff. 8-9-1990; Crt eff. 9-28-2018; Crt eff. 2-28-2025.

11 KAR 8:030 Teacher scholarships {#sec-11-kar-8-030 omnilex-key=us-ky-regs-official--title-11--11 KAR 8:030}

Section 1. Definitions.

(1) "Authority" is defined in KRS 164.740(1).

(2) "Critical shortage area" is defined in KRS 164.769(2)(a).

(3) "Default" means the status of an obligation under this program that has entered repayment and upon which no payment has been made for a cumulative period of 180 days following the repayment begin date for the obligation.

(4) "Eligible program of study" is defined in KRS 164.769(2)(b).

(5) "Expected family contribution" is defined in KRS 164.769(2)(c).

(6) "Kentucky Teacher Internship Program" or "KTIP" means the one (1) year of supervision, assistance, and assessment that is:

(a) Required by KRS 161.030 and established in 16 KAR 7:010; and

(b) Also referenced as the beginning teacher internship.

(7) "Participating institution" is defined in KRS 164.769(2)(d).

(8) "Professional Teaching Certificate" means the document issued to:

(a) An individual upon successful completion of the beginning teacher internship; or

(b) An applicant for whom the testing and internship requirement is waived under KRS 161.030 based on preparation and successful completion of the assessments.

(9) "Public school" means the common schools of the Commonwealth providing preschool, elementary, middle school, or secondary instruction.

(10) "Qualified teaching service" is defined in KRS 164.769(2)(e).

(11) "Semester" is defined in KRS 164.769(2)(f).

(12) "Summer term" is defined in KRS 164.769(2)(g).

(13) "Teaching" means performing continuous classroom instruction that:

(a) Is:

Pursuant to a professional teaching certificate in a position for which regular teacher certification is a prerequisite; or
During participation in the Kentucky Teacher Internship Program (KTIP); and

(b) Shall not include substitute teaching.

Section 2. Eligibility of Renewal Applicants and Selection Process.

(1) Applicants shall complete the Teacher Scholarship Application set forth in 11 KAR 4:080, Section 1(3), according to its instructions. The applicant shall ensure that the completed application and supporting data indicating the applicant's financial need are received by the authority on or before May 1, or the next regular business day if May 1 falls on a weekend or holiday preceding the academic year for which the award is requested.

(2) Eligibility of renewal applicants. A person who previously received a loan or scholarship pursuant to KRS 164.769 shall be eligible to apply for and be considered for a renewal teacher scholarship if, at the time of application and disbursement, the renewal applicant has made satisfactory progress toward completion of the eligible program of study in accordance with standards prescribed by the participating institution.

(3) After awards are made to all qualified renewal applicants, applicants shall be considered and teacher scholarships shall be awarded to recipients in the following order until funds are depleted:

(a) Initial applicants who meet the standards and requirements established by the Education Professional Standards Board pursuant to KRS 161.028 and have been unconditionally admitted to a teacher education program shall be ranked in ascending order by expected family contribution.

(b) Initial applicants who have not yet been admitted to a teacher education program but who meet the standards and requirements established by the Education Professional Standards Board pursuant to KRS 161.028 for admission to a teacher education program shall be ranked in ascending order by expected family contribution.

(c) Otherwise eligible initial applicants seeking admission to a teacher education program shall be ranked in ascending order by expected family contribution.

Section 3. Award Maximums.

(1) The amount of a teacher scholarship award shall be calculated by determining the student's total cost of education minus expected family contribution and the amount of financial aid received or expected to be received during the academic period. The amount of financial aid received or expected to be received during the academic period shall not include any amounts available from any student loan or work-study programs.

(2) The maximum teacher scholarship award for a student classified as a junior, senior, post baccalaureate, or graduate shall be $2,000 for a summer session, $3,000 for a semester, and $6,000 for an academic year (exclusive of a summer session).

(3) The maximum teacher scholarship award for a student classified as a freshman or sophomore shall be $2,000 for a summer session, $2,500 for a semester, and $5,000 for an academic year (exclusive of a summer session).

(4) The maximum award to an eligible student enrolled less than full time in the last semester or summer term during which a baccalaureate, post baccalaureate, or master's degree will be completed shall be $500 per credit hour during a semester or summer session.

Section 4. Disbursements.

(1) Disbursement of a teacher scholarship shall be made at the beginning of each semester or summer session and each disbursement shall be evidenced by a promissory note, prescribed by the authority, in which the scholarship recipient shall agree to repay the scholarship funds or render qualified teaching service in lieu thereof.

(2) The monies awarded under the Teacher Scholarship Program shall be transmitted directly to the participating institution on behalf of all students eligible to receive the scholarship by electronic funds transfer.

(3) The authority shall send to the participating institution a disbursement roster containing each recipient's name and Social Security number.

(4) The participating institution shall hold the funds solely for the benefit of the student eligible to receive the scholarship and the authority until the recipient has registered for classes for the period of enrollment for which the scholarship is intended.

(5) Upon the recipient's registration, the participating institution shall immediately credit the recipient's account and notify the recipient in writing that it has so credited that account, and deliver to the recipient any remaining scholarship proceeds.

(6) The participating institution shall indicate on the disbursement roster the date funds were either credited to the student's account or disbursed to the student, the name of a recipient for whom funds are being returned, the amount being returned, and the reason funds are being returned.

(7) If a recipient does not register for the period of enrollment for which the scholarship was awarded, or a registered student withdraws or is expelled prior to the first day of classes of the period of enrollment for which the scholarship is awarded, the school shall return the proceeds to the authority pursuant to Section 12 of this administrative regulation.

(8) The school shall retain a copy of the disbursement roster for its records and forward the original roster and any undisbursed scholarship funds to the authority not later than thirty (30) days following receipt of the roster and the funds.

(9)

(a) If a recipient subsequently refuses to repay the scholarship on grounds that he was unaware of or did not receive delivery of the scholarship proceeds from the school, upon written request from the authority, the school shall promptly provide documentary evidence to the authority that the recipient received or had funds credited to his student account and was notified of this transaction.

(b) The school shall otherwise reimburse the authority for any amount of the scholarship that is unenforceable absent that documentary evidence.

(c) The obligation of the school to provide the documentary evidence specified in paragraph (a) of this subsection shall continue until the recipient's obligations for repayment of the scholarship is paid in full or otherwise discharged.

Section 5. Cancellation.

(1) A recipient rendering qualified teaching service in a designated critical shortage area shall remain eligible for the critical shortage credit provided by KRS 164.769(6)(c) if:

(a) The authority determines that an area is no longer a critical shortage area; and

(b) The recipient continues to render qualified teaching service in the area.

(2)

(a) If a recipient has received loans or scholarships from more than one (1) program that is administered by the authority, and requires a period of qualified teaching service for repayment or cancellation, the teaching requirements shall not be fulfilled concurrently.

(b) Unless the authority determines otherwise for cause, loans or scholarships from more than one (1) program shall be repaid or cancelled by qualified teaching service in the same order in which they were received.

(c) If a recipient has received a loan or scholarship pursuant to KRS 164.768, 164.769 or 164.770 during the same semester as receiving a scholarship pursuant to KRS 161.165, the loan or scholarship received pursuant to KRS 164.768, 164.769 or 164.770 shall be repaid or cancelled by qualified teaching service prior to the scholarship received pursuant to KRS 161.165.

(3) A recipient shall receive cancellation under this program for each semester during which service is provided as specified in KRS 164.769(6)(c) if the recipient:

(a) Has completed the program of study;

(b) Is providing qualified teaching service; and

(4) Verification of qualified teaching service shall be submitted to the authority in writing, signed by the local school district superintendent or building principal.

Section 6. Repayment.

(1) A recipient failing to complete the eligible program of study, attain certification after completion of the eligible program of study, or commence rendering qualified teaching service within the six (6) month period following completion of the eligible program of study shall immediately become liable to the authority to pay the sum of all promissory notes and accrued interest thereon, unless the authority grants a deferment for cause.

(2) The interest rate applicable to repayment of a teacher scholarship under this section shall be six (6) percent per annum beginning April 1, 2005. Prior to April 1, 2005, the interest rate shall be twelve (12) percent per annum.

(3) If a repayment obligation subsequently becomes eligible for service credit cancellation as a result of the recipient's provision of teaching service, refund of payments previously made shall not be given to the recipient.

Section 7. Default.

(1) Upon default on a repayment obligation under this program, the recipient's account shall be transferred to the appropriate agency of the Commonwealth of Kentucky for collections and shall be subject to the collection charges and fees assessed by that agency.

(2) A recipient whose repayment obligation has defaulted and who subsequently begins either providing qualified teaching service in the Commonwealth of Kentucky or participating in KTIP shall be removed from default status.

Section 8. Disability Discharge. A conditional or permanent discharge of the repayment obligation required by this program shall be granted by the Authority upon submission by the recipient of the documentation required by this section.

(1) Conditional discharge. A conditional discharge shall be granted for a maximum two (2) year period, subject to annual review by the Authority, upon the submission of one (1) of the following as proof of the recipient's qualifying disability:

(a) A finding of permanent disability by the Social Security Administration; or

(b) A completed Teacher Scholarship Program Application for Discharge, which shall include a certification by the recipient's treating physician that the recipient is unable to work or earn money and that the condition is expected to persist indefinitely.

(2) Permanent discharge. At the expiration of the two (2) year Conditional Discharge period specified in subsection (1) of this section, the Authority shall grant a permanent discharge to a recipient under this program upon the submission by the recipient of current documentation verifying that the qualifying disability exists at the time the permanent discharge is granted.

Section 9. Notifications. A recipient shall notify the authority within thirty (30) days of:

(1) Change in enrollment status;

(2) Cessation of full-time enrollment in an eligible program of study;

(3) Employment in a qualified teaching service position; or

(4) Change of name or address.

Section 10. Repayment Schedule. Written notification of demand for repayment shall be sent by the authority to the scholarship recipient's last known address and shall be effective upon mailing. The authority may agree to accept repayment in installments in accordance with a schedule established by the authority. Payments shall first be applied to interest and then to principal on the earliest unpaid promissory note.

Section 11. Records. A participating institution shall maintain complete and accurate records pertaining to the eligibility, enrollment, and progress of each student receiving aid under this program and the disbursement of funds and institutional charges as may be necessary to audit the disposition of these funds. The institution's records shall be maintained for at least three (3) years after the student ceases to be enrolled at the institution.

Section 12. Refunds.

(1) If a student fails to enroll, withdraws, is expelled from the institution, or otherwise fails to complete the program on or after the student's first day of class of the period of enrollment or changes enrollment status, the Authority may be due a refund of monies paid to the institution on behalf of that student or a repayment of cash disbursements made to the student for educational expenses.

(2) If the student received financial assistance administered by the authority, the refund and repayment shall be due to the authority for its financial assistance programs in accordance with this section.

(3) The institution shall adopt and implement a fair and equitable refund policy for financial assistance administered by the authority which shall be:

(a) A clear and conspicuous written statement;

(b) Made available to a prospective student, prior to the earlier of the student's enrollment or the execution of the student's enrollment agreement, and to currently enrolled students;

(d) Made available to the authority upon request.

(4) The institution's refund policy for financial assistance administered by the authority shall either:

(a) Use the same methods and formulas for determining the amount of a refund as the institution uses for determining the return of federal financial assistance funds; or

(b) Be a separate and distinct policy adopted by the institution that is based upon:

The requirements of applicable state law; or
The specific refund standards established by the institution's nationally-recognized accrediting agency.

(5) The amount of the refund shall be determined in accordance with the educational institution's refund policy relative to financial assistance funds, except as provided in subsection (7) of this section.

(6) If the institution determines that a refund of financial assistance is due in accordance with its policy, the institution shall allocate to the financial assistance programs administered by the authority the refund and repayment in the following descending order of priority prior to allocating the refund to institutional or private sources of financial assistance:

(a) CAP grant;

(b) KTG;

(d) Teacher Scholarship;

(e) Kentucky Educational Excellence Scholarship;

(f) Kentucky Coal County College Completion Scholarship;

(g) National Guard tuition assistance; and

(h) Early Childhood Development Scholarship.

(7)

(a) If a teacher scholarship recipient officially or unofficially withdraws from or is expelled by an institution before the first day of classes of the award period, the award shall be deemed an overaward and a full refund and repayment of the teacher scholarship shall be required, notwithstanding any institutional policy to the contrary.

(b) If the institution is unable to document the student's last date of attendance, any teacher scholarship disbursement for that award period shall be subject to full refund.

(c) If a teacher scholarship recipient's enrollment is terminated with no assessment of tuition and fees by the institution, the full teacher scholarship shall be subject to:

Cancellation, if not yet disbursed; or
Refund if the teacher scholarship has already been disbursed.

(8)

(a) The institution shall remit to the authority the amount of funds allocated from the refund amount to the financial assistance programs administered by the authority as soon as possible but no later than thirty (30) days after the end of the term in which the student ceased to be enrolled.

(b) Refunds by the institution transmitted to the authority shall be accompanied by:

The student's name and Social Security number;
The reason for the refund;
The date of enrollment status change;
The semester and year; and
The calculation used for determining the refund.

Section 13. Information Dissemination and Recruitment. The authority shall disseminate information through high school principals, counselors, and school superintendents about this program to potential recipients. The participating institution shall provide assurances that program information will be disseminated to students enrolled at the institution. The participating institution shall actively recruit students from minority population groups for participation in this program.

Section 14. Incorporation by Reference.

(1) "Teacher Scholarship Program Application for Discharge", November 2007, is incorporated by reference.

History

RELATES TO: KRS 164.740, 164.744(2), 164.753(3), 164.769
STATUTORY AUTHORITY: KRS 164.748(4), 164.753(3), 164.769(5), (6)(f)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.744(2) authorizes the authority to provide scholarships and KRS 164.753(3) requires the Kentucky Higher Education Assistance Authority to promulgate administrative regulations pertaining to standards for scholarship programs. KRS 164.769 establishes a teacher scholarship program and requires the Kentucky Higher Education Assistance Authority to establish the terms and conditions for the award, cancellation, and repayment of teacher scholarships, awarded under KRS 164.769 and under prior teacher scholarship programs administered by the Kentucky Higher Education Assistance Authority. This administrative regulation establishes selection criteria, disbursement procedures, cancellation of repayment procedures and repayment obligations related to scholarships provided under the program.
History: 16 Ky.R. 2794; eff. 8-9-1990; 17 Ky.R. 3483; 18 Ky.R. 274; eff. 7-8-1991; 1152; eff. 11-14-1991; 19 Ky.R. 2480; eff. 7-1-1993; 21 Ky.R. 59; 909; eff. 9-12-1994; 23 Ky.R. 159; 1387; eff. 9-5-1996; 25 Ky.R. 890; 1398; eff. 1-19-1999; 26 Ky.R. 1440; 1676; eff. 3-10-2000; 2281; 27 Ky.R. 555; 736; eff. 9-11-2000; 3310; eff. 8-15-2001; 30 Ky.R. 361; 837; eff. 10-31-2003; 30 Ky.R. 1575; eff. 3-18-2004; 31 Ky.R. 1320; 1505; eff. 3-11-2005; 33 Ky.R. 182; 713; eff. 10-6-2006; 34 Ky.R. 1762; 2074; eff. 4-4-2008; 35 Ky.R. 950; 1424; eff. 1-5-2009; 36 Ky.R. 1510, 2031-M, eff. 4-2-2010; 40 Ky.R. 78; 528; eff. 9-9-2013; 41 Ky.R. 835; 1497; eff. 2-6-2015; Crt eff. 9-28-2018; 50 Ky.R. 853, 1466; eff. 1-11-2024.

11 KAR 8:040 Deferment of teacher scholarship repayment {#sec-11-kar-8-040 omnilex-key=us-ky-regs-official--title-11--11 KAR 8:040}

Section 1. Definitions.

(1) "Authority" is defined by KRS 164.740(1).

(2) "Default" means the status of an obligation under this program that has entered repayment and upon which no payment has been made for a cumulative period of 180 days following the repayment begin date for the obligation thereon.

(3) "Deferment" means a temporary waiver of the obligation of a teacher scholarship recipient to make payments to the authority, pursuant to one (1) or more promissory notes executed between the recipient and the authority, which is granted by the authority, for a specified period of time, upon a showing of cause by the recipient.

(4) "Eligible institution" is defined in KRS 164.740(4).

(5) "Kentucky Teacher Internship Program" or "KTIP" means the one (1) year of supervision, assistance, and assessment that is:

(a) Required by KRS 161.030 and established in 16 KAR 7:010; and

(b) Also referenced as the beginning teacher internship.

(6) "Participating institution" is defined in KRS 164.769(2)(d).

(7) "Professional Teaching Certificate" means the document issued to:

(a) An individual upon successful completion of the beginning teacher internship;

(b) An applicant for whom the testing and internship requirement is waived under KRS 161.030 based on preparation and successful completion of the assessment.

(8) "Qualified teaching service" is defined in KRS 164.769(2)(e).

(9) "Semester" is defined in KRS 164.769(2)(f).

(10) "Teaching" means performing continuous classroom instruction pursuant to a Professional Teaching Certificate or during participation in the Kentucky Teacher Internship Program (KTIP), and shall not include substitute teaching.

Section 2. Request for Deferment.

(1) The recipient shall request a deferment in writing by submitting complete and accurate information on one (1) of the following forms, as appropriate:

(a) "Teacher Scholarship Program Request For School Enrollment Deferment";

(b) "Teacher Scholarship Program Request For Unemployment Deferment";

(d) "Teacher Scholarship Program Request For Hardship Deferment";

(e) "KHEAA Teacher Scholarship Program Request For Alternative Certification Deferment"; or

(f) "KHEAA Teacher Scholarship Program Military Service Deferment Request".

(2) The recipient's submission of a request for deferment shall constitute authorization for the authority to request and receive the verification of facts represented by the recipient as may be deemed necessary by the authority.

Section 3. Effect on Repayments.

(1) During a deferment, principal or interest repayments shall not be required. Interest shall:

(a) Continue to accrue on the unpaid principal balance owed by the recipient during a period specified in Section 4(1), (3), (4), or (5) of this administrative regulation; and

(b) Not accrue during a period specified in Section 4(2) of this administrative regulation.

(2) The authority shall not be required to grant a deferment if the deferment would legally impair the ultimate recovery of the principal and accrued interest otherwise owed by the recipient.

(3) If, during a deferment, the recipient resumes full-time enrollment in a teacher education program at a participating institution or renders qualified teaching service, the deferment shall nullify the prior commencement of repayment, and a promissory note so deferred may be subsequently cancelled in accordance with 11 KAR 8:030.

Section 4. Types of Deferments. Except as provided in subsection (6) of this section, if the requirements established in this section are met, the authority shall grant an enrollment deferment, disability deferment, unemployment deferment, hardship deferment, military service deferment, alternative certification deferment, or qualified teaching service deferment.

(1) Enrollment deferment.

(a) An enrollment deferment shall be a deferment granted to a recipient who is enrolled on at least a half-time basis at an eligible institution in the United States.

(b) Each semester, the recipient shall provide to the authority evidence of the enrollment on the "Teacher Scholarship Program Request for School Enrollment Deferment" form.

Forty-eight (48) months for a recipient enrolled in a baccalaureate program; or
Sixty (60) months for a recipient enrolled in a graduate program.

(2) The authority shall grant deferment of repayment for periods not to exceed an aggregate of thirty-six (36) months for any one (1) or combination of the following circumstances, unless a documented extenuating circumstance is approved by the executive director of the authority:

(a) Disability deferment.

A disability deferment shall be a deferment granted to a recipient who is:

a. Temporarily totally disabled and, therefore, unable to obtain full-time employment or attend school; or

b. Unable to obtain full-time employment or attend school due to the temporary total disability of the recipient's spouse who:

(i) Requires continuous (twenty-four (24) hour) nursing or similar care by the recipient; and

(ii) Is not confined to a hospital, nursing home, intermediate care facility, or similar institution.

For purposes of a disability deferment, a recipient, or the spouse of a recipient, shall be considered temporarily totally disabled if the person suffers an injury or illness which necessitates an extended or indefinite period of recovery which can be expected to preclude gainful employment or school attendance.
The recipient shall provide to the authority a statement from a licensed physician certifying that the recipient or spouse is temporarily totally disabled in accordance with subparagraphs 1 and 2 of this paragraph. The recipient shall be solely responsible for securing the physician's certification.
The authority shall grant a disability deferment subject to an annual review of the physician's certification.
After the third year of a disability deferment, the authority shall cancel the debt if it appears that the disability is expected to continue for an indefinite time.

(b) Unemployment deferment. An unemployment deferment shall be granted to a recipient seeking, but unable to obtain, a qualified teaching service position within six (6) months following completion of a teacher education program at a participating institution. The recipient shall:

Be eligible to begin the Kentucky Teacher Internship Program established in KRS 161.030(5) and 16 KAR 7:010;
Have applied for a qualified teaching service position with at least three (3) public schools of the Commonwealth or private schools certified pursuant to KRS 156.160(3);
Not have refused an offer of employment in a qualified teaching service position in the Kentucky public or certified private schools to which the recipient may have applied; and
Provide the authority with a signed statement which sets forth:

a. The recipient's current address;

b. The names of the Kentucky public or certified private schools to which the recipient has applied for qualified teaching service employment; and

c. The recipient's agreement to notify the authority if the recipient obtains full-time employment in a qualified teaching service position.

Enrollment in a teacher education program or employment in a qualified teaching service position is temporarily interrupted due to circumstances beyond the recipient's control, including major illness, accident or death in the family, after which the recipient intends to resume the enrollment or qualified teaching position; or
The recipient is insolvent due to circumstances beyond his control, including natural disaster, involuntary unemployment, or unforeseen medical expenses.

(3) Military service deferment. The authority shall grant a military service deferment to a recipient upon proof of current active duty status in the United States Armed Forces, subject to annual review and verification by the authority.

(4) Alternative certification deferment.

(a) A deferment shall be granted to a recipient who has received a provisional certification by the Kentucky Education Professional Standards Board (EPSB) under one (1) of the alternative routes to teacher certification established by the EPSB in 16 KAR Chapter 9.

(b) The deferment shall be granted for up to thirty-six (36) months in order to allow sufficient time for the recipient to complete the Kentucky Teacher Internship Program and to obtain professional teaching certification.

(5) Qualified teaching service deferment.

(a) A deferment shall be granted to a recipient who, due to current employment in a qualified teaching service position, may reasonably be expected, solely with the passage of six (6) months or less time, to qualify for cancellation benefits pursuant to 11 KAR 8:030.

(b) The authority shall grant a deferment of the obligation to repay the teacher scholarship during the period of time in which the recipient is making payments or performing qualified teaching service for another program if:

The recipient received loans or scholarships from more than one (1) program that:

a. Is administered by the authority; and

b. Required a period of qualified teaching service for repayment or cancellation; and

The recipient is either:

a. Obligated to concurrently make cash payments on the teacher scholarship and other program; or

b. Performing qualified teaching service to fulfill the other program's requirements.

(6) Upon default of a repayment obligation under this program, a recipient shall be permanently barred from eligibility for the other deferments provided for in this administrative regulation.

Section 5. Incorporation by Reference.

(1) The following material is incorporated by reference:

(a) "Teacher Scholarship Program Request For School Enrollment Deferment", March 2002;

(b) "Teacher Scholarship Program Request For Unemployment Deferment", March 2002;

(d) "Teacher Scholarship Program Request For Hardship Deferment", March 2002;

(e) "KHEAA Teacher Scholarship Program Request for Alternative Certification Deferment", November 2007; and

(f) "KHEAA Teacher Scholarship Program Military Service Deferment Request", November 2007.

History

RELATES TO: KRS 164.740, 164.744(2), 164.769
STATUTORY AUTHORITY: KRS 164.748(4), 164.753(3), 164.769(6)(f)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.744(2) authorizes the authority to provide scholarships, and KRS 164.769 authorizes the authority to specifically provide a program of teacher scholarships. KRS 164.748(4) and 164.753(3) require the authority to promulgate administrative regulations pertaining to the awarding of scholarships as provided in KRS 164.740 to 164.7891. KRS 164.769(6)(f) requires the authority to promulgate administrative regulations establishing the terms and conditions for the award, cancellation, and repayment of teacher scholarships including deferments. This administrative regulation establishes conditions for deferment of the repayment obligation.
History: 16 Ky.R. 2796; eff. 8-9-1990; Am. 27 Ky.R. 3313; eff. 8-15-2001; 29 Ky.R. 2499; 2863; eff. 6-3-2003; 31 Ky.R. 581; 924; eff. 11-8-2004; 33 Ky.R. 1871; 2928; eff. 4-6-2007; 34 Ky.R. 1766; 2076; eff. 4-4-2008; 35 Ky.R. 954; 1426; eff. 1-5-2009; TAm eff. 4-27-2016; Crt eff. 9-28-2018; Crt eff. 2-28-2025.

Chapter 10 Congressional Teacher Scholarship Program

11 KAR 10:010 Paul Douglas Teacher Scholarship Program {#sec-11-kar-10-010 omnilex-key=us-ky-regs-official--title-11--11 KAR 10:010}

Section 1. Definitions.

(1) "Academic year award" means the aggregate amount of scholarship assistance received for one (1) academic year (July 1 through June 30) represented by one or more recipient agreements or promissory notes.

(2) "Academic year" means a period of time during which a full-time student is expected to complete the equivalent of one (1) of the following:

(a) Two (2) semesters.

(b) Two (2) trimesters.

(3) The definition of "authority" is governed by KRS 164.740(1).

(4) "Course of study" means a first undergraduate program of study at an institution of higher education, which leads to initial teacher certification at the preschool, elementary or secondary school level, but does not include graduate study unless it is required for initial teacher certification.

(5) "Collection costs" mean the costs incurred by the authority or its agents, including the costs of long distance phone calls, certified mail, skiptracing, court costs, and attorney fees, necessary to recover past due payment from the scholar.

(6) The definition of "federal act" is governed by KRS 164.740(9).

(7) "Full-time student" means a student enrolled in an institution of higher education, other than a correspondence school, who is carrying a full-time academic workload as determined by the institution under standards applicable to all students enrolled in that student's program.

(8) "Institution of higher education" means a public or private, nonprofit educational institution approved by the secretary under the federal act for participation in the Paul Douglas Teacher Scholarship program.

(9) "Scholar" means a Paul Douglas Teacher Scholarship recipient.

(10) The definition of "scholarship" is governed by KRS 164.740(18).

(11) The definition of "secretary" is governed by KRS 164.740(20).

Section 2. The authority shall, to the extent of funds available for such purpose, award Paul Douglas Teacher Scholarships to persons enrolled or accepted for enrollment as a full-time student in a course of study at an institution of higher education, who declare an intention to teach and who meet the eligibility requirements set forth in Section 3 of this administrative regulation and are selected pursuant to Section 4 of this administrative regulation.

Section 3. Eligibility Criteria. In order to apply and be considered for a scholarship, an individual shall meet the following criteria:

(1)

(a) Be a U.S. citizen or national;

(b) Provide evidence from the U.S. Immigration and Naturalization Service that he:

Is a permanent resident of the United States; or
Is in the United States for other than a temporary purpose with the intention of becoming a citizen or permanent resident; or

(2) Be a legal resident of the Commonwealth of Kentucky, as determined in accordance with the Council on Higher Education's policy on classification for fee assessment purposes at 13 KAR 2:045;

(3)

(a) Have graduated or be scheduled to graduate from high school within three (3) months of the date of the award and rank in the top ten (10) percent of high school graduating class; or

(b) Have received a certificate of high school equivalency for successfully completing the tests of General Educational Development (GED) with GED test scores equivalent to ranking in the top ten (10) percent of the high school graduates in Kentucky, or nationally, in the academic year for which the eligibility determination is being made.

Section 4. Selection Criteria. A panel (representative of parents, teachers, including preschool and special education, and school administrators) shall select recipients using the following criteria:

(1) Special consideration in the selection of at least seventy-five (75) percent of the scholarship recipients shall be given to individuals who state on their application that they:

(a) Intend to teach or provide related services to students with disabilities;

(b) Intend to teach limited English proficient students;

(d) Intend to teach in schools servicing inner city or rural or geographically isolated areas (as defined by the U.S. Secretary of Education by regulations consistent with the purposes of this section);

(e) Intend to teach in curricular areas or geographic areas where there are demonstrated shortages of qualified teachers; or

(f) Are from disadvantaged backgrounds, including racial and ethnic minorities and individuals with disabilities, and are underrepresented in the teaching profession or in the curricular areas in which they are preparing to teach.

(2) Applicants given special consideration pursuant to subsection (1) of this section shall be ranked in descending order according to total points accumulated using the following criteria:

(a) Cumulative high school grade point average (forty (40) points); and

(b) American College Test composite standard score (thirty-six (36) points); and

Level of communication skills (nine (9) points); and
Ability to become an effective teacher (nine (9) points); and

(d) An additional ten (10) points shall be given to those enrolling in college for the first time as a full-time student.

(3) If funds remain, applicants who do not meet the special consideration criteria prescribed in subsection (1) of this section shall be ranked according to the selection criteria prescribed in subsection (2) of this section, and scholarships shall be offered until funds are exhausted. No more than twenty-five (25) percent of new awards will be made to eligible applicants who do not meet any of the special consideration criteria.

(4) If funds are insufficient to award all applicants, the scholarships shall first be awarded to those qualifying for awards pursuant to Section 5 of this administrative regulation whose renewal applications are received by the authority by April 1 each year. The deadline for receipt of initial scholarship applications shall be April 15 each year. If two (2) or more applicants are equally ranked, selection between the applicants shall be made on the basis of the date the application is received by the authority.

Section 5. Renewal. Additional academic year awards shall be made annually upon application by an eligible scholar for a maximum of three (3) years of undergraduate study. The criteria to maintain eligibility for renewal of scholarships is governed by 34 C.F.R. 653.41.

Section 6. Award Maximums. The maximum academic year award shall be the lesser of $5,000 or the total cost of attendance as determined by the institution of higher education. The aggregate maximum shall not exceed $20,000.

Section 7. Disbursements. Payment shall be made at the beginning of each term, and each disbursement shall be evidenced by an agreement or promissory note, required pursuant to Section 9 of this administrative regulation

Section 8. Notifications. Scholars shall notify the authority within thirty (30) days of:

(1) Change in enrollment status;

(2) Cessation of enrollment in a course of study;

(3) Obtaining full-time teaching employment or cessation of such employment;

(4) Change in deferment status; or

(5) Change of address.

Section 9. Scholarship Agreement. The requirement and content of a scholarship agreement is governed by 34 C.F.R. 653.40, 52 Federal Register 45285, November 25, 1987, as amended at 55 Federal Register 35006, August 27, 1990.

Section 10. Failure to Teach. The consequences of a scholar's failure to teach full-time in a public or private nonprofit preschool, elementary, or secondary school, or teach children with disabilities or limited English proficiency in a private nonprofit school, including the commencement and rate of repayment and the interest charges, are governed by 34 C.F.R. 653.42(a) through (f), 52 Federal Register 45285, November 25, 1987.

Section 11. Repayment Schedule. Written notification of demand for repayment shall be sent by the authority to the scholar's last known address and shall be effective upon mailing. Repayment shall be made in monthly installments as may be necessary to repay all sums due within the time and in amounts required by the scholar's agreement. The authority may agree, in its sole discretion upon a showing of financial hardship by the scholar, to accept repayment in installments less than those required by the scholar's agreement in accordance with a schedule established by the authority. Payments shall first be applied to the earliest unpaid scholarship. Payments shall be applied first to accrued interest and then to principal.

Section 12. Cancellation. The conditions for cancellation of repayment of scholarships are governed by 34 C.F.R. 653.42(k).

Section 13. Records. A participating institution of higher education shall maintain complete and accurate records pertaining to the eligibility, enrollment and academic progress of scholars, the disbursement of funds and institutional charges as may be necessary to audit the disposition of funds hereunder. Such records shall be maintained for at least five (5) years after the scholar ceases to be enrolled at the institution.

Section 14. Refunds. A participating institution of higher education shall refund to the authority, within forty (40) days of a scholar's last date of attendance, any amount attributable to this program which is determined to be due under the institution's refund policy.

Section 15. Information Dissemination and Recruitment. The authority shall disseminate information through high school guidance offices about this program to potential recipients. Participating institutions of higher education shall provide assurances that program information will be disseminated to students enrolled at that institution. Students from low income, economically disadvantaged and minority population groups shall be actively recruited for participation in this program.

History

RELATES TO: KRS 164.744(2), 164.748(7), (8), 34 C.F.R. Part 653
STATUTORY AUTHORITY: KRS 164.748(4), 164.753(3), 34 C.F.R. Part 653, subparts C, D, E
NECESSITY, FUNCTION, AND CONFORMITY: Pub.L. 98-558 established the Carl D. Perkins Scholarship Program, subsequently renamed the Congressional Teacher Scholarship Program and then renamed the Paul Douglas Teacher Scholarship Program, to encourage highly qualified students to become teachers in a public or private, nonprofit preschool, elementary or secondary school in any state. Pursuant to Section 523(b)(2) of the federal act (20 U.S.C. 1105b(b)(2)), the governor designated the authority as the agency to administer this program on behalf of the Commonwealth. 34 C.F.R. 653.32(a) authorizes the authority to establish selection criteria. 34 C.F.R. 653.20(b)(5) and 653.21 require the authority to limit the amount of awards, restrict eligibility for awards, and authorizes the authority to establish policies and procedures necessary to administer repayment. This administrative regulation prescribes rules for the administration of the Paul Douglas Teacher Scholarship Program. This amendment is necessary to conform to amendments to the federal Act enacted by Pub.L. 102-325.
History: 13 Ky.R. 1674; eff. 4-14-1987; 18 Ky.R. 3486; eff. 8-1-1992; 20 Ky.R. 383; 741; eff. 10-7-1993; Crt eff. 9-28-2018; Crt eff. 2-28-2025.

11 KAR 10:020 Deferment and reduction of repayment {#sec-11-kar-10-020 omnilex-key=us-ky-regs-official--title-11--11 KAR 10:020}

Section 1. Definitions.

(1) The definition of "authority" is governed by KRS 164.740(1).

(2) "Deferment" means a temporary waiver of the obligation of a scholar to make payments to the authority, pursuant to one (1) or more agreements or promissory notes executed between the scholar and the authority, which is granted by the authority, for a specified period of time, upon a showing of cause by the scholar.

(3) The definition of "federal act" is governed by KRS 164.740(9).

(4) "Institution of higher education" means a public or private, nonprofit educational institution approved by the secretary under the federal act for participation in the Paul Douglas Scholarship program.

(5) The definition of "secretary" is governed by KRS 164.740(20).

(6) "Scholar" means a Paul Douglas Scholarship recipient.

(7) The definition of "scholarship" is governed by KRS 164.740(18).

Section 2. Request for Deferment. The scholar shall request a deferment in writing by submitting complete and accurate information on a form provided by the authority. The scholar's submission of a request for deferment shall constitute authorization for the authority to request and receive verification of facts represented by the scholar as may be deemed necessary by the authority. The scholar shall provide to the authority, at least annually:

(1) For purposes of an enrollment deferment, evidence of enrollment certified by an authorized representative of an institution of higher education;

(2) For purposes of a disability deferment, an affidavit from a licensed physician certifying that the scholar or spouse is temporarily totally disabled;

(3) For purposes of an unemployment deferment, a signed statement that sets forth:

(a) The scholar's current address;

(b)

The names of school districts to which the scholar has applied for full-time teaching employment; or
The names and addresses of each public or private employment agency, if one is accessible, where the scholar has registered; and

(c) The scholar's agreement to notify the authority within thirty (30) days of the date upon which he obtains either full-time teaching employment or other full-time employment; or

(4) For purposes of a military deferment, a statement, signed by an authorized representative of the armed forces, evidencing the active duty status and period of enlistment of the scholar.

(5) If, during the period of deferment, a change occurs in the scholar's circumstances that served as the basis for the deferment approved pursuant to this section, then that deferment shall immediately terminate.

Section 3. Effect on Repayment. The consequences of a deferment upon the obligation of a scholar to repay is governed by 34 CFR 653.42(i) and (j), 52 Federal Register 45285, November 25, 1987.

Section 4. Types of Deferments. The circumstances that qualify for deferment are governed by 34 CFR 653.42(g), 52 Federal Register 45285, November 25, 1987.

Section 5. Financial Incapacity. The authority may temporarily reduce the installments required for repayment of a scholarship, at its sole discretion, upon a demonstration that the scholar, due to lack of income or other financial circumstances beyond the scholar's control, is temporarily unable to repay the scholarship in accordance with the regular repayment schedule. The scholar shall request this reduced repayment schedule by submitting a statement, signed by the scholar, on a form provided by the authority, delineating all of the income, expenses, and other financial circumstances of the scholar constituting the asserted financial incapacity.

History

RELATES TO: KRS 164.744(2), 164.748(7), (8), 34 C.F.R. 653.21, 653.42
STATUTORY AUTHORITY: KRS 164.748(4), 164.753(3), 34 C.F.R. 653.21, 653.42
NECESSITY, FUNCTION, AND CONFORMITY: Public Law 98-558 established the Carl D. Perkins Scholarship Program, subsequently renamed the Congressional Teacher Scholarship Program and then subsequently renamed the Paul Douglas Teacher Scholarship Program. The Kentucky Higher Education Assistance Authority (authority) administers the program on behalf of the Commonwealth of Kentucky. That law, at 20 USC 1104g, and federal regulation 34 CFR 653.42(g), (i) and (j), authorize certain exceptions to repayment. 34 CFR 653.42(h) authorizes the authority to prescribe documentation necessary to obtain a deferment. 34 CFR 653.42(d)(2)(ii) authorizes the authority to reduce the required payments upon a showing of inability to repay. 34 CFR 653.21(a)(4) requires the authority to establish and implement policies and procedures necessary to administer repayment under 653.42. This administrative regulation defines "deferment" and establishes conditions under which specified types of deferments may be approved by the authority. This amendment is necessary to conform to amendments to the federal Act enacted by PL 102-325.
History: 13 Ky.R. 1677; eff. 4-14-1987; 18 Ky.R. 3489; eff. 8-1-1992; 20 Ky.R. 385; 743; eff. 10-7-1993; Crt eff. 9-28-2018; Crt eff. 2-28-2025.

Chapter 12 Kentucky Educational Savings Plan Trust

11 KAR 12:010 Definitions for 11 KAR Chapter 12 {#sec-11-kar-12-010 omnilex-key=us-ky-regs-official--title-11--11 KAR 12:010}

Section 1. Definitions.

(1) "Academic period" means one (1) semester or one (1) quarter or an equivalent period for a vocational technical institution.

(2) "Account" means the account in the program fund established and maintained under the trust for a beneficiary.

(3) "Account balance" means the fair market value of an account as of the accounting date.

(4) "Accounting date" means the date, not later than the last business day of each quarter as determined by the program administrator.

(5) "Administrative fund" is defined by KRS 164A.305(2).

(6) "Beneficiary" is defined by KRS 164A.305(3).

(7) "Benefits" is defined by KRS 164A.305(4).

(8) "Board" is defined by KRS 164A.305(5).

(9) "Dependent person" means a person who is unable to meet the criteria for an independent person as defined in subsection (13) of this section.

(10) "Designated date" means the date on which each beneficiary is eligible to be designated in a participation agreement.

(11) "Domicile" or "legal residence" means a person's true, fixed, and permanent home and is the place where the person intends to remain, and to which the person expects to return if absent without intending to establish a new domicile elsewhere.

(12) "Effective date" means the date which a participant may enter into a participation agreement with the trust, which is on or after July 1, 1989.

(13) "Independent" means a person:

(a) Who has not been claimed by his parent as a dependent on a federal or state income tax return for the tax year preceding the date of application for reclassification of residency status;

(b) Who demonstrates no financial dependence upon a parent; and

(c) Whose parent's income is not taken into account by a private or governmental agency furnishing educational financial assistance to the person, including a scholarship, loan, or other assistance.

(14) "Institution of higher education" is defined by KRS 164A.305(7).

(15) "Notice to authorize payroll deduction" means the participant's written instruction to the participant's employer to deduct payments from the participant's earnings and forward that amount to the trust.

(16) "Notice to increase or decrease payments under participation agreement" means the participant's written instruction to the program administrator of the trust to increase or decrease payments under a participation agreement.

(17) "Notice to preauthorize debit" means the participant's mailed or electronic written instruction to the participant's financial institution to debit or charge the participant's checking or savings account for payments due under the participation agreement.

(18) "Notice to substitute beneficiary" means the participant's mailed or electronic written instruction to the program administrator of the trust to substitute a beneficiary.

(19) "Notice to terminate the participation agreement" means the participant's mailed or electronic written instruction to the program administrator of the trust to terminate a participation agreement under the trust.

(20) "Notice to use trust benefits" means the participant's mailed or electronic written instruction to the program administrator of the trust to notify the trust of the date benefits are to begin and level of benefits paid.

(21) "Parent" means one (1) of the following:

(a) A person's father or mother; or

(b) A court-appointed legal guardian if the guardianship was not established primarily to confer Kentucky residency on the person.

(22) "Participant" is defined by KRS 164A.305(9).

(23) "Participation agreement" is defined by KRS 164.305(10).

(24) "Payments" means the money paid by the participant to the trust under the participation agreement.

(25) "Program administrator" is defined by KRS 164A.305(11).

(26) "Program fund" is defined by KRS 164A.305(12).

(27) "Property settlement agreement" or "decree of dissolution by the court" means the agreement or judgment approved or entered by a court of competent jurisdiction that establishes the participant's right, if any, to the participant's interest in the participation agreement.

(28) "Qualified Educational Expenses" is defined by KRS 164A.305(13).

(29) "Trust year" means the fiscal year beginning July 1 and ending the following June 30 of each year.

(30) "Vested participation agreement" is defined by KRS 164A.305(14).

History

RELATES TO: KRS 164A.300-164A.380
STATUTORY AUTHORITY: KRS 164A.310(14), 164A.325(9)
CERTIFICATION STATEMENT: This is to certify that this administration regulation complies with the requirements of 2025 RS HB 6, Section 8.
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164A.310(14) authorizes the board to promulgate administrative regulations to implement the provisions of KRS 164A.300 to KRS 164A.380 consistent with federal Internal Revenue Code regulations. KRS 164A.325(9) authorizes the board to promulgate administrative regulations to implement the Kentucky Educational Savings Plan Trust. This administrative regulation establishes the definitions for 11 KAR Chapter 12.
History: 011 KAR 012:010. 17 Ky.R. 3568; eff. 8-2-1991; 19 Ky.R. 433; eff. 10-1-1992; 25 Ky.R. 392; 810; eff. 10-1-1998; 26 Ky.R. 85; 557; eff. 9-1-1999; 2284; 27 Ky.R. 471; eff. 8-14-2000; 28 Ky.R. 1437; 1789; eff. 2-11-2002; 29 Ky.R. 985; eff. 12-18-2002; Crt eff. 9-28-2018; 52 Ky.R. 178, 940; eff. 3-3-2026.

11 KAR 12:020 General rules for investments and fund transfers {#sec-11-kar-12-020 omnilex-key=us-ky-regs-official--title-11--11 KAR 12:020}

Section 1. Investments.

(1) The program administrator, an investment manager, a trustee or depository institution holding funds received pursuant to KRS 164A.335 shall adhere to the following standards:

(a) Safety of principal at the time of a projected cash need shall be paramount for all investment situations;

(b) Liquidity of investments shall be assured for funds that may be needed to satisfy short term cash flow needs; and

(c) Except as provided in paragraphs (a) and (b) of this subsection, maximizing investment yield shall be the prime objective of an investment.

(2) In accordance with the standards established in subsection (1) of this section, the board, through the program administrator or an investment manager, shall invest funds received pursuant to KRS 164A.335 in any of the following solely in the interest of the participants and beneficiaries and for the exclusive purposes of providing benefits to beneficiaries and defraying reasonable expenses of administering the plan:

(a) Deposits or banker's acceptances with commercial banks whose outstanding indebtedness is rated by a nationally recognized rating service at an appropriate level, and deposits with a financial institution to the extent fully insured by the Federal Deposit Insurance Corporation or other U.S. government insurance entity;

(b) U.S. Treasury securities, obligations backed by the full faith and credit of the United States government, and U. S. government agency securities;

Governed by a Public Securities Association or equivalent master repurchase agreement including the appropriate annexes; and
Collateralized at 100 percent with U.S. Treasury securities, U.S. government agency securities, and other obligations backed by the full faith and credit of the United States government. Collateral shall be held by a third-party custodian;

(d) State or municipal obligations rated in one (1) of the two (2) top classifications by a nationally recognized rating service (at least AA or Aa, SP-2 or MIG-2/VMIG-2);

(e) Obligations of a U.S. corporation, if the obligations are rated at least AA or As by a nationally recognized rating service;

(f) Collateralized mortgage or credit card obligations, mortgage backed securities, or similar securities that are collateralized at 100 percent, if the obligations are either:

Fully insured by a U.S. government insurance entity; or
Issued by a corporation whose obligations would be an authorized investment;

(g) Commercial paper rated in the highest classification as established by a nationally recognized rating service (A-1 or Prime-1);

(h) Mutual funds, including money market funds, equity funds, international funds, growth funds, income funds, and funds combining one (1) or more of the foregoing investment options which, at the time of making the investment, are, by law, permitted for the investment of funds by fiduciaries in this state; and

(i) Other investments approved by the board of directors with the care, skill, prudence, and diligence under the circumstances then prevailing that a prudent investor acting in a like capacity and familiar with the matters would use in the conduct of an enterprise of a like character and with like aims.

Section 2. Administrative Fund.

(1) The costs of administering the Kentucky educational savings plan trust shall be paid out of the administrative fund.

(2) Funds shall be transferred to the administrative fund from the program fund, as the program administrator determines is necessary to cover the administrative costs of the trust.

(3) The total amount transferred to the administrative fund during a trust year shall not exceed four (4) percent of the total investment earnings accruing and credited to the program fund during that trust year.

(4) Monies transferred to the administrative fund pursuant to KRS 164A.335 and this administrative regulation shall be deposited in accordance with KRS 41.070(2).

History

RELATES TO: KRS 41.070(2), 164A.310(4), 164A.325(7), 164A.335, 164A.375
STATUTORY AUTHORITY: KRS 164A.310(14), 164A.325(9)
CERTIFICATION STATEMENT: This is to certify that this administration regulation complies with the requirements of 2025 RS HB 6, Section 8.
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164A.325(9) authorizes the board to promulgate administrative regulations necessary for the administration of the savings plan trust. KRS 164A.310(4) requires the board to invest moneys within the program fund in investments determined by the board to be appropriate. KRS 164A.310(14) authorizes the board to promulgate administrative regulations to implement the provisions of KRS 164A.300 to KRS 164A.380 consistent with federal Internal Revenue Code regulations. This administrative regulation establishes the requirements for investments and fund transfers.
History: 011 KAR 012:020. 17 Ky.R. 3570; eff. 8-2-1991; 19 Ky.R. 435; eff. 10-1-1992; 26 Ky.R. 86; 626; 714; eff. 10-11-1999; Crt eff. 9-28-2018; 52 Ky.R. 180, 940; eff. 3-3-2026.

11 KAR 12:030 Eligibility of beneficiary and participant {#sec-11-kar-12-030 omnilex-key=us-ky-regs-official--title-11--11 KAR 12:030}

Section 1. Beneficiary Eligibility. A beneficiary shall be a resident of any state.

Section 2. Participant Eligibility. A participant shall be a resident of any state.

Section 3.

(1) In order to participate in the Kentucky educational savings plan trust, a participant shall submit to the program administrator, by mail or electronic method, a signed participation agreement, including the valid Social Security number or federal identification number of the beneficiary and the valid Social Security number or federal identification number of the participant.

(2) A state or local government agency or instrumentality or an organization described in 26 U.S.C. 501(c)(3) that establishes an account as part of a scholarship program shall submit to the program administrator the Social Security number of the recipient upon designation of the scholarship recipient.

Section 4. Incorporation by Reference.

(1) Kentucky Educational Savings Plan Trust Participation Agreement, July 2000, is incorporated by reference.

(2) This material may be inspected, copied, or obtained, subject to applicable copyright law, at the Kentucky Higher Education Assistance Authority, 1050 U.S. 127 South, Frankfort, Kentucky 40601, Monday through Friday, 8 a.m. to 4:30 p.m.

History

RELATES TO: KRS 164A.330, 164A.380
STATUTORY AUTHORITY: KRS 164A.310(14), 164A.325(9)
CERTIFICATION STATEMENT: This is to certify that this administration regulation complies with the requirements of 2025 RS HB 6, Section 8.
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164A.325(9) authorizes the board to promulgate administrative regulations necessary for the administration of the savings plan trust. KRS 164A.330 authorizes the Kentucky Educational Savings Plan Trust to enter into a participation agreement with a participant on behalf of a beneficiary. KRS 164A.380 provides that KRS 164A.300 to 164A.380 shall be construed liberally in order to effectuate its legislative intent and the powers granted shall be broadly interpreted to effectuate the intent and purposes. KRS 164A.310(14) authorizes the board to promulgate administrative regulations to implement the provisions of KRS 164A.300 to KRS 164A.380 consistent with federal Internal Revenue Code regulations. This administrative regulation establishes the eligibility criteria for a beneficiary and a participant to participate in the participation agreement.
History: 011 KAR 012:030. 17 Ky.R. 3571; eff. 8-2-1991; 19 Ky.R. 436; eff. 10-1-1992; 26 Ky.R. 2285; 27 Ky.R. 472; eff. 8-14-2000; 29 Ky.R. 986; eff. 12-18-2002; Crt eff. 9-28-2018; 52 Ky.R. 182, 940; eff. 3-3-2026.

11 KAR 12:040 Residency classification for Kentucky Educational Savings Plan Trust vested participation agreements {#sec-11-kar-12-040 omnilex-key=us-ky-regs-official--title-11--11 KAR 12:040}

Section 1. Residency Requirement.

(1) A person who has been a resident of the Commonwealth of Kentucky for at least eight (8) continuous years and was designated as a beneficiary under a participation agreement that is in full force and effect for that entire eight (8) year period, shall be deemed to have a vested participation agreement, even if the beneficiary leaves the state prior to enrollment in an institution of higher education.

(2) For purposes of subsection (1) of this section, a participation agreement shall be deemed to be in full force and effect if, at the end of the eight (8) year period, the total contributions of principal to the account that remain in the account balance equals $2400 and the participation agreement has not been cancelled at the time that the beneficiary first enrolls in an institution of higher education.

Section 2. Proof of Residency.

(1) Following the expiration of the period of eight (8) years of continuous residency by the beneficiary, either the participant or the beneficiary shall submit to the program administrator evidence of the residency to establish a vested participation agreement. Evidence submitted on behalf of a dependent person shall pertain to the domicile of either parent during the claimed period of residency. An individual who enrolls in college immediately following graduation from high school and remains enrolled shall:

(a) Be treated as a dependent person unless the contrary is evident from the information submitted; and

(b) Have his domicile inferred from the student's permanent address, parent's mailing address, or location of high school of graduation.

(2) A person claiming independent status shall document independent status under subsection (4) of this section and shall demonstrate by clear and convincing evidence that domicile in Kentucky has been established by that person's acts.

(3) The determination of residency shall be based upon verifiable circumstances or actions. A single fact shall not be paramount, and each situation shall be evaluated to identify those facts which are essential to the determination of domicile.

(4) The following facts, although not conclusive, shall have probative value in support of a claim for resident classification:

(a) Full-time employment in Kentucky or transfer to an employer in contiguous area while maintaining domicile in Kentucky;

(b) Filing of Kentucky resident income tax return for each applicable calendar year of claimed residency status;

(c) Attendance as a full-time, nonresident student at an out-of-state institution of higher education while determined to be a resident of Kentucky;

(d) Abandonment of a former domicile and establishing domicile in Kentucky with attendance at an institution of higher education following and incidental to the change in domicile;

(e) Payment of occupational taxes in Kentucky;

(f) Payment of real property taxes in Kentucky;

(g) Payment of intangible personal property taxes in Kentucky;

(h) Ownership of real property in Kentucky, if the property was used as a residence during the claimed period of residency status;

(i) Long-term lease of housing during the claimed period of residency status;

(j) Kentucky automobile registration during the claimed period of residency;

(k) Kentucky driver's license during the claimed period of residency status;

(l) Registration as a Kentucky voter during the claimed period of residency; or

(m) Corroborating affidavit of a nonrelative.

(5) The determination of residency shall be based upon verifiable circumstances or actions and authenticated copies of relevant documentation. The program administrator may request additional documentation to clarify circumstances and shall formulate a decision that considers all relevant facts.

Section 3. Nontransferability of Vested Participation Agreement. Although the participant may freely substitute beneficiaries under a participation agreement, the residency status acquired by a beneficiary of a vested participation agreement shall not be used to confer residency status on a substituted beneficiary, nor shall the residency of one (1) beneficiary be taken into account in the establishment of a vestment period for a substituted beneficiary.

History

RELATES TO: KRS 164A.305(14), 164A.330(6)
STATUTORY AUTHORITY: KRS 164A.325(9)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164A.325(9) authorizes the board to promulgate administrative regulations to implement the Kentucky Educational Savings Plan Trust. KRS 164A.330(6) requires that each participation agreement provide that for a vested participation agreement, the beneficiary shall be considered a resident of the Commonwealth for tuition purposes if the beneficiary enrolls in an institution of higher education in Kentucky. This administrative regulation establishes the standards for proof of residency of a beneficiary for a vested participation agreement.
History: 011 KAR 012:040. 17 Ky.R. 3572; eff. 8-2-1991; 19 Ky.R. 437; eff. 10-1-1992; 25 Ky.R. 393; 811; eff. 10-1-1998; 26 Ky.R. 2286; eff. 8-14-2000; 28 Ky.R. 1438; 1789; eff. 2-11-2002; Crt eff. 9-28-2018; 52 Ky.R. 183; eff. 3-3-2026.

11 KAR 12:050 Substitution of a beneficiary {#sec-11-kar-12-050 omnilex-key=us-ky-regs-official--title-11--11 KAR 12:050}

Section 1. Substitution.

(1) A participant may substitute a beneficiary at any time subject to KRS 164A.330(4). If a participant desires to substitute the beneficiary, the participant shall submit a written notice to substitute beneficiary to the program administrator by mail or electronically.

(2) In order for a substitution of beneficiary to be effective, the substituted beneficiary shall be already designated as a beneficiary on another account or eligible, pursuant to 11 KAR 12:030 and 26 U.S.C. 529(e)(1), on the date that the notice to substitute beneficiary is submitted.

History

RELATES TO: KRS 164A.330(4), (5), 26 U.S.C. 529(e)(1)
STATUTORY AUTHORITY: KRS 164A.310(14), 164A.325(5), (9)
CERTIFICATION STATEMENT: This is to certify that this administration regulation complies with the requirements of 2025 RS HB 6, Section 8.
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164A.325(9) authorizes the board to promulgate administrative regulations for the administration of the Kentucky Educational Savings Plan Trust. KRS 164A.330(4) and (5) establishes the statutory framework for the substitution of a beneficiary. KRS 164A.325(5) authorizes the board to promulgate, impose, and collect administrative fees and charges for trust transactions. KRS 164A.310(14) authorizes the board to promulgate administrative regulations to implement the provisions of KRS 164A.300 to KRS 164A.380 consistent with federal Internal Revenue Code regulations. This administrative regulation establishes the requirements for the substitution of a beneficiary.
History: 011 KAR 012:050. 17 Ky.R. 3574; eff. 8-2-1991; 19 Ky.R. 438; eff. 10-1-1992; 23 Ky.R. 161; 1389; eff. 9-5-1996; 26 Ky.R. 2287; eff. 8-14-2000; 28 Ky.R. 1439; 1790; eff. 2-11-2002; Crt eff. 9-28-2018; 52 Ky.R. 185, 942; eff, 3-3-2026.

11 KAR 12:060 Cancellation, partial withdrawal, and payment of refund {#sec-11-kar-12-060 omnilex-key=us-ky-regs-official--title-11--11 KAR 12:060}

Section 1. Cancellation. To cancel a participation agreement pursuant to KRS 164A.350(2), a participant shall submit to the program administrator a notice to terminate the participation agreement by mail or electronically.

Section 2. Partial Withdrawal. A participant may request a partial withdrawal of an account balance without cancellation of the participating agreement. To request a partial withdrawal from a Kentucky Educational Savings Plan Trust account, a participant shall submit a written request to the program administrator by mail or electronically.

Section 3. Refund. The amount to be refunded pursuant to KRS 164A.350, shall be mailed or otherwise sent to the participant within sixty (60) days after receipt by the program administrator of notice to terminate the participation agreement or written request for partial withdrawal submitted by mail or electronically.

History

RELATES TO: KRS 164A.350
STATUTORY AUTHORITY: KRS 164A.310(14), 164A.325(5), (9), 164A.350(2)
CERTIFICATION STATEMENT: This is to certify that this administration regulation complies with the requirements of 2025 RS HB 6, Section 8.
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164A.325(9) authorizes the board to promulgate administrative regulations to implement the Kentucky Educational Savings Plan Trust. KRS 164A.325(5) authorizes the board to promulgate, impose, and collect administrative fees and charges for trust transactions. KRS 164A.310(14) authorizes the board to promulgate administrative regulations to implement the provisions of KRS 164A.300 to KRS 164A.380 consistent with federal Internal Revenue Code regulations. KRS 164A.350(2) provides that a participant may cancel a participation agreement. This administrative regulation establishes the procedures for cancellation of the participation agreement and refund of the account balance.
History: 011 KAR 012:060. 17 Ky.R. 3575; eff. 8-2-1991; 19 Ky.R. 439; eff. 10-1-1992; 21 Ky.R. 2723; 22 Ky.R. 30; eff. 7-6-1995; 25 Ky.R. 395; 812; 991; eff. 10-1-1998; 26 Ky.R. 88; eff. 9-1-1999; 28 Ky.R. 1440; eff. 2-11-2002; 30 Ky.R. 364; eff. 10-31-2003; 36 Ky.R. 2055-A; eff. 7-12-2010; Crt eff. 9-28-2018; 52 Ky.R. 187, 942; eff. 3-3-2026.

11 KAR 12:070 Benefits payable from the Kentucky Educational Savings Plan Trust Program fund {#sec-11-kar-12-070 omnilex-key=us-ky-regs-official--title-11--11 KAR 12:070}

Section 1. Distribution of Benefits.

(1) Upon submission of a notice to use trust benefits, the participant shall specify the level of benefits to be paid. The participant shall elect distribution of an allotment of the account balance or a higher amount, which shall not exceed the beneficiary's higher education costs for each academic period. The may adjust the level of benefits paid in an academic period by notifying the program administrator in writing either by mail or electronically.

(2) Distribution of benefits shall begin on request and continue throughout the beneficiary's period of enrollment at an institution of higher education, or until the account balance has been exhausted, whichever occurs first.

(3) If a participant transfers ownership rights pursuant to KRS Chapter 385, Uniform Transfers to Minors Act, notwithstanding KRS 385.202(1), which mandates the transfer of custodial property to the minor upon attainment of age eighteen (18), the property shall be distributed for postsecondary educational purposes in accordance with the terms of the participation agreement during each academic period of the beneficiary's educational program.

Section 2. Beneficiary Residing Off Campus. If a beneficiary resides off campus, upon written request of the participant, the program administrator shall pay to the beneficiary or participant, for room and board for an academic period, that portion of higher education costs not paid to the institution that shall not exceed the amount of the beneficiary's higher education costs permitted for room and board pursuant to 26 U.S.C. 529.

Section 3. Unused Benefits.

(1) During academic period. If a beneficiary's higher education costs are less than the benefits due, that portion of the unused benefits shall accumulate to the beneficiary's account. The unused benefits plus the beneficiary's entitlement in the program fund not exceeding the higher education costs may be paid for the beneficiary at a future date.

(2) After education attainment. If the beneficiary completes education attainment, and a balance remains in the beneficiary's account, the program administrator shall pay, upon the written request of the participant submitted by mail or electronically, the balance of the payments and the earnings from the investments in the program fund remaining in the account to the participant pursuant to KRS 164A.350.

History

RELATES TO: KRS 164A.310(8), 164A.330(5), 164A.335, 26 U.S.C. 529
STATUTORY AUTHORITY: KRS 164A.310(14), 164A.325(9)
CERTIFICATION STATEMENT: This is to certify that this administration regulation complies with the requirements of 2025 RS HB 6, Section 8.
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164A.325(9) authorizes the board to promulgate administrative regulations to implement the Kentucky Educational Savings Plan Trust. This administrative regulation establishes the maximum benefits payable in an academic period, the duration of the payments, the payment of benefits for a beneficiary residing off campus and the notice provisions for a refund of the payments for nonuse or unused benefits from the program fund.
History: 011 KAR 012:070. 17 Ky.R. 3576; eff. 8-2-1991; 19 Ky.R. 440; eff. 10-1-1992; 2482; eff. 7-1-1993; 21 Ky.R. 2724; 22 Ky.R. 31; eff. 7-6-1995; 25 Ky.R. 397; 812; eff. 10-1-1998; 26 Ky.R. 89; 558; eff. 9-1-1999; 2288; eff. 8-14-2000; Crt eff. 9-28-2018; 52 Ky.R. 189; eff. 3-3-2026.

11 KAR 12:090 Transfer of ownership of Kentucky Educational Savings Plan Trust Program fund {#sec-11-kar-12-090 omnilex-key=us-ky-regs-official--title-11--11 KAR 12:090}

Section 1. General Rule. A participant may assign ownership interest in payments to another eligible participant at any time. An assignment of ownership shall only be effective to transfer ownership interest in the trust if the assignment:

(1) Is to another individual who qualifies as eligible pursuant to 11 KAR 12:030;

(2) Is irrevocable;

(3) Transfers all ownership, reversionary rights, and powers of appointment (i.e., power to substitute beneficiaries) and to direct the distribution of benefits; and

(4) Is in writing and submitted to the program administrator either by mail or electronically.

Section 2. Subject to Section 1 of this administrative regulation and in accordance with KRS Chapter 385, a participant, eighteen (18) years old or older, may make a gift of the ownership interest in the program fund to a minor beneficiary by designating in the assignment that the transfer is to a qualified custodian for the beneficiary.

Section 3. Upon receipt of a valid assignment of ownership, the assignee shall be considered the participant for all purposes of KRS 164A.300 through 164A.380, regardless of the source of subsequent payments.

History

RELATES TO: KRS 164A.350(6), Chapter 385
STATUTORY AUTHORITY: KRS 164A.310(14), 164A.325(9)
CERTIFICATION STATEMENT: This is to certify that this administration regulation complies with the requirements of 2025 RS HB 6, Section 8.
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164A.350 states that the participant retains ownership of the principal amount of payments to the program fund, and that the trust retains ownership of the investment income until distributions are made. KRS 164A.300 through 164A.380 provide to the participant reversionary rights in the investment income in the event of termination, and confer upon the participant various powers to terminate the participation agreement, substitute beneficiaries, and delay distribution of benefits. Nothing in the foregoing statutes prohibits a participant from transferring these rights and ownership and reversionary interests to another eligible participant or to a minor beneficiary under the Uniform Transfers to Minors Act. Furthermore, nothing in the foregoing statutes precludes a beneficiary from also being a participant. This administrative regulation permits such a transfer and sets forth the procedures to facilitate a transfer under the Uniform Transfers to Minors Act.
History: 011 KAR 012:090. 17 Ky.R. 3580; eff. 8-2-1991; 19 Ky.R. 442; eff. 10-1-1992; Crt eff. 9-28-2018; 52 Ky.R. 190; eff. 3-3-2026.

Chapter 13 Award Programs

11 KAR 13:010 National Guard Tuition Award Program {#sec-11-kar-13-010 omnilex-key=us-ky-regs-official--title-11--11 KAR 13:010}

Section 1. Definitions. The terms listed below shall have the following meanings:

(1) The definition of "authority" is governed by KRS 164.740(1).

(2) The definition of "educational institution" is governed by KRS 164.516(1).

(3) "Participating educational institution" means an educational institution that has a contract in force with the authority on such terms as the authority may deem necessary or appropriate to the administration of the Kentucky National Guard Tuition Award Program and other programs administered by the authority.

Section 2. Prior to the beginning of each award period, defined in 106 KAR 3:010, Section 1(1), for which funds are to be disbursed, the Department of Military Affairs shall prepare enrollment verification rosters which identify the participating educational institution, the names and Social Security numbers of eligible students planning to attend each participating educational institution, the award amount for each eligible student to be disbursed by the authority, the award period for each eligible student, the academic year, and the total number of eligible students and total amount of awards. The enrollment verification rosters shall be transmitted by the Department of Military Affairs to the financial aid director at each participating educational institution.

Section 3. Following enrollment of students listed on the enrollment verification roster, the financial aid director or his designee at each participating educational institution that receives an enrollment verification roster shall verify each student's enrollment status and return the properly certified enrollment verification roster to the Department of Military Affairs.

Section 4. The Department of Military Affairs shall transmit the certified enrollment verification rosters to the authority with a request to transfer funds to the participating educational institutions. Upon receipt, the authority shall begin the necessary procedures to disburse funds to the appropriate educational institution.

Section 5.

(1) A student who withdraws, changes enrollment status, or for any other reason is charged less than the amount certified on the enrollment verification roster may be due a refund of monies paid to the institution or owe a repayment to one (1) or more student financial assistance programs. If the student received student financial assistance, a portion of any refund shall be due to the student financial assistance programs. The amount of any refund or repayment shall be determined in accordance with the participating educational institution's refund and repayment policies relative to student financial assistance funds, except that if a Kentucky National Guard Tuition Award Program recipient officially or unofficially withdraws from or is expelled by an institution before the first day of classes of the award period, the award shall be cancelled and a full refund or repayment of the Kentucky National Guard Tuition Award shall be required, notwithstanding any institutional policy to the contrary. These policies shall be consistently administered and published or otherwise made publicly available by the participating educational institution. The authority shall be notified in writing of any changes in such policies.

(2) In cases of unofficial withdrawal, the institution shall use the last recorded date of class attendance by the student as the end of the student's enrollment. If the institution is unable to document the student's last date of attendance, any Kentucky National Guard Tuition Award Program disbursement for that award period shall be subject to full refund and repayment. If, at any time, a Kentucky National Guard Tuition Award Program recipient's enrollment is terminated with no assessment of tuition and fees by the institution, then the full Kentucky National Guard Tuition Award shall be subject to cancellation, if not yet disbursed, or refund and repayment if the award has already been disbursed.

(3) Any refunds or repayments due on funds disbursed as Kentucky National Guard Tuition Award Program funds shall be paid to the authority. The authority shall deposit the refunds and repayments to an account to be used for other awards made pursuant to the program.

(4) Refunds by institutions and notifications of student repayments due transmitted to the authority shall be accompanied by the student's name and Social Security number, the reason for the refund or repayment, date of enrollment status change, the semester and year, and the calculation used for determining each refund or repayment.

Section 6. All documentation and correspondence relating to the cancellation, disbursement, and refund of awards shall be retained by the authority for audit purposes for a period of five (5) years from the date that the award was certified. Documentation may be retained in any format used by the authority for storage of its records in the normal course of business.

History

RELATES TO: KRS 164.516-164.5169
STATUTORY AUTHORITY: KRS 164.746(6), 164.748(4), 164.5161(2)
NECESSITY, FUNCTION, AND CONFORMITY: The 1996 regular session of the General Assembly enacted the Kentucky National Guard Tuition Award Program, and directed that the Kentucky Higher Educational Assistance Authority adopt administrative regulations pertaining to the financial management of the program, including the disbursement of funds. This administrative regulation is necessary to prescribe procedures for the disbursement of funds. The administrative regulation provides that the authority shall transfer funds to educational institutions upon receipt of an enrollment verification roster provided by the Department of Military Affairs identifying eligible participants and the amounts to be awarded.
History: 23 Ky.R. 2636; 3310; eff. 3-6-1997; Crt eff. 9-28-2018; Crt eff. 2-28-2025.

Chapter 14 Osteopathic Medicine Scholarship Program

11 KAR 14:010 Osteopathic Medicine Scholarship Program application process {#sec-11-kar-14-010 omnilex-key=us-ky-regs-official--title-11--11 KAR 14:010}

Section 1. Definition. "Authority" is defined in KRS 164.740(1).

Section 2.

(1) The school of osteopathic medicine shall send notification to the authority by August 1 of each year of those students eligible to receive the scholarship.

(2) The list submitted by the school of osteopathic medicine shall contain each eligible student's name, address, Social Security number, and academic year for which the promissory note is applicable.

Section 3. Promissory Notes.

(1) Following receipt of the list of eligible students required by Section 2 of this administrative regulation, the authority shall deliver to the school of osteopathic medicine a promissory note for signature by each student eligible to receive an osteopathic medicine scholarship.

(2)

(a) The promissory note shall be signed by the student in the presence of an official of the school of osteopathic medicine.

(b) The student shall present to the school official adequate identification, including a driver's license, a school identification, or other item of identification satisfactory to the school official, to ensure that the person signing the promissory note is the student named on the promissory note.

(c) After the student has signed the promissory note, a copy shall be retained by the student for his records and the original shall be returned by the school to KHEAA.

(3) The school of osteopathic medicine shall deliver to the authority with the original signed promissory note for a student eligible to receive the scholarship a data sheet containing the following information necessary to process the promissory note for the scholarship:

(a) Student's complete name;

(b) Student's Social Security number;

(d) Student's current home telephone number;

(e) Student's anticipated graduation date;

(f) Student's date of birth;

(g) Student's gender;

(h) Student's academic classification; and

(i) Name, permanent address, and telephone number of at least two (2) contact persons (one (1) of whom shall be a relative of the student) expected to know the student's whereabouts after the student ceases enrollment.

History

RELATES TO: KRS 164.7891
STATUTORY AUTHORITY: KRS 164.748(4), 164.7891(9)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.7891(9) requires the authority to promulgate administrative regulations for administration of the Osteopathic Medicine Scholarship Program. This administrative regulation establishes the application process for the Osteopathic Medicine Scholarship Program.
History: 25 Ky.R. 451; 813; eff. 10-1-1998; 28 Ky.R. 656; 1106; eff. 11-5-2001; Crt eff. 9-28-2018; Crt eff. 2-28-2025.

11 KAR 14:020 Osteopathic Medicine Scholarship Program award determination {#sec-11-kar-14-020 omnilex-key=us-ky-regs-official--title-11--11 KAR 14:020}

Section 1. Insufficient Funds. If funds are insufficient to award full scholarships to all applicants, a ranking system shall be used in awarding the scholarships. The full scholarship shall be awarded first to those students closest to completing the Osteopathic Medicine Scholarship Program.

History

RELATES TO: KRS 164.7891
STATUTORY AUTHORITY: KRS 164.748(4), 164.7891
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.7891 requires the authority to promulgate administrative regulations for administration of the Osteopathic Medicine Scholarship Program. This administrative regulation establishes procedures for the priority of awarding scholarships if funds are insufficient to honor all requests.
History: 25 Ky.R. 453; 813; eff. 10-1-1998; Crt eff. 9-28-2018; Crt eff. 2-28-2025.

11 KAR 14:030 Osteopathic Medicine Scholarship Program disbursement process {#sec-11-kar-14-030 omnilex-key=us-ky-regs-official--title-11--11 KAR 14:030}

Section 1. Definition. "Authority" is defined in KRS 164.740(1).

Section 2. Disbursement of Funds.

(1) Within thirty (30) days following receipt by the authority of the original signed promissory notes for all students eligible to receive the osteopathic medicine scholarship, the monies awarded under the Osteopathic Medicine Scholarship Program shall be transmitted directly to the school of osteopathic medicine on behalf of all students eligible to receive the osteopathic medicine scholarship by electronic funds transfer.

(2) The authority shall send to the school a disbursement roster containing each recipient's name and Social Security number.

(3) The school shall hold the funds solely for the benefit of the student eligible to receive the osteopathic medicine scholarship and the authority until the recipient has registered for classes for the period of enrollment for which the scholarship is intended.

(4) Upon the recipient's registration, the school shall immediately credit the recipient's account and notify the recipient in writing that it has so credited that account, and deliver to the recipient any remaining osteopathic medicine scholarship proceeds.

(5) The school shall indicate on the disbursement roster the date funds were either credited to the student's account or disbursed to the student, the name of a recipient for whom funds are being returned, the amount being returned, and the reason funds are being returned.

(6) If a recipient does not register for the period of enrollment for which the scholarship was awarded, or a registered student withdraws or is expelled prior to the first day of classes of the period of enrollment for which the scholarship is awarded, the school shall return the proceeds to the authority by electronic funds transfer within ten (10) days of the recipient's withdrawal, expulsion, or failure to register.

(7) The school shall retain a copy of the disbursement roster for its records and forward the original roster and any undisbursed osteopathic medicine scholarship funds to the authority not later than thirty (30) days following receipt of the roster and the funds.

Section 3.

(1)

(a) If a recipient subsequently refuses to repay the osteopathic medicine scholarship on grounds that he was unaware of or did not receive delivery of the scholarship proceeds from the school, upon written request from the authority, the school shall promptly provide documentary evidence to the authority that the recipient received or had funds credited to his student account and was notified of this transaction.

(b) The school shall otherwise reimburse the authority for any amount of the scholarship that is unenforceable absent that documentary evidence.

(2) The obligation of the school to provide the documentary evidence specified in subsection (1)(a) of this section shall continue until the recipient's obligations for repayment of the osteopathic medicine scholarship is paid in full or otherwise discharged.

History

RELATES TO: KRS 164.7891
STATUTORY AUTHORITY: KRS 164.748(4), 164.7891(9)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.7891 requires the authority to promulgate administrative regulations for administration of the Osteopathic Medicine Scholarship Program. This administrative regulation establishes procedures for disbursement of the monies awarded under the Osteopathic Medicine Scholarship Program.
History: 25 Ky.R. 454; 814; eff. 10-1-1998; 26 Ky.R. 1433; eff. 3-10-2000; Crt eff. 9-28-2018; Crt eff. 2-28-2025.

11 KAR 14:040 Osteopathic Medicine Scholarship Program overawards and refunds {#sec-11-kar-14-040 omnilex-key=us-ky-regs-official--title-11--11 KAR 14:040}

Section 1. Definitions.

(1) "Authority" is defined in KRS 164.740(1).

(2) "Federal act" is defined in KRS 164.740(9) and means 20 USC 1001 through 1146a.

Section 2. General.

(1) An osteopathic medicine scholarship recipient fails to enroll, withdraws from, is expelled from an accredited osteopathic medicine program, or otherwise fails to complete the program on or after his first day of class of the period of enrollment or changes enrollment status may be due a refund of monies paid to the school on behalf of that student or repayment of cash disbursements made to the student for educational expenses.

(2) If the student received an osteopathic medicine scholarship, all or a portion of the refund and repayment shall be due to the authority in accordance with this section and Section 3 of this administrative regulation.

(3) The school shall adopt and implement a fair and equitable refund policy for financial assistance administered by the authority which shall be:

(a) A clear and conspicuous written statement;

(b) Made available to a prospective student, prior to the earlier of the student's enrollment or the execution of the student's enrollment agreement, and to currently enrolled students;

(d) Made available to the authority upon request.

(4) The school's refund policy for financial assistance administered by the authority may use the same methods and formulas for determining the amount of a refund as the school uses for determining the return of federal financial assistance funds or the school may adopt a separate and distinct policy that is based upon:

(a) The requirements of applicable state law; or

(b) The specific refund standards established by the school's nationally-recognized accrediting agency.

(5) The amount of the refund shall be determined in accordance with the educational school's refund policy relative to financial assistance funds, except as provided in Section 3 of this administrative regulation.

(6) When the school determines that a refund of financial assistance is due in accordance with its policy, the school shall return osteopathic medicine scholarship funds to the authority prior to making refunds to school or private sources of financial assistance.

Section 3. Failure to Enroll or Official Withdrawal Before Classes Begin.

(1) If an osteopathic medicine scholarship recipient fails to enroll in, officially or unofficially withdraws from, or is expelled by the accredited osteopathic medicine program prior to the first day of classes, the scholarship award shall be deemed an overaward and a full refund and repayment of the monies to the authority shall be required, notwithstanding a policy of the school to the contrary.

(2) If the school is unable to document the student's last date of attendance, any osteopathic medicine scholarship disbursement for that award period shall be subject to full refund.

(3) If, at any time, an osteopathic medicine scholarship recipient's enrollment is terminated with no assessment of tuition and fees by the school, then the full osteopathic medicine scholarship shall be subject to cancellation, if not yet disbursed, or refund if the osteopathic medicine scholarship has already been disbursed.

Section 4. Withdrawal after Classes Begin. If an osteopathic medicine scholarship recipient officially withdraws from the osteopathic medicine program after the beginning of classes, the amount of refund shall be determined in accordance with the school's refund and repayment policy relative to financial aid funds.

Section 5. Unofficial Withdrawal. If an osteopathic medicine scholarship recipient unofficially withdraws from an accredited osteopathic medicine program, the authority shall not seek from the school a refund of the monies paid under the scholarship. The osteopathic medicine scholarship recipient shall be responsible for immediate repayment of the entire amount of monies paid under the scholarship as well as the applicable interest.

Section 6.

(1) The school shall remit to the authority the amount of funds allocated from the refund amount to the financial assistance programs administered by the authority as soon as possible but no later than thirty (30) days after the end of the term in which the student ceased to be enrolled.

(2) Refunds by the school transmitted to the authority shall be accompanied by:

(a) The student's name and Social Security number;

(b) The reason for the refund;

(d) The semester and year; and

(e) The calculation used for determining the refund.

History

RELATES TO: KRS 164.7891
STATUTORY AUTHORITY: KRS 164.748(4), 164.7891
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.7891 requires the authority to promulgate administrative regulations for administration of the Osteopathic Medicine Scholarship Program. This administrative regulation establishes procedures for refund to the authority of monies paid under the Osteopathic Medicine Scholarship Program.
History: 25 Ky.R. 456; 814; eff. 10-1-1998; 27 Ky.R. 3315; eff. 8-15-2001; Crt eff. 9-28-2018; Crt eff. 2-28-2025.

11 KAR 14:050 Osteopathic Medicine Scholarship Program recordkeeping requirements {#sec-11-kar-14-050 omnilex-key=us-ky-regs-official--title-11--11 KAR 14:050}

Section 1. The school of osteopathic medicine shall maintain complete and accurate records pertaining to the eligibility, enrollment, and progress of students receiving aid under this program and the disbursement of funds and institutional charges as may be necessary to audit the disposition of these funds. The school's records shall be maintained for at least three (3) years after the student ceases to be enrolled at the school of osteopathic medicine.

History

RELATES TO: KRS 164.7891
STATUTORY AUTHORITY: KRS 164.748(4), 164.7891
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.7891 requires the authority to promulgate administrative regulations for administration of the Osteopathic Medicine Scholarship Program. This administrative regulation establishes requirements for maintaining records under the Osteopathic Medicine Scholarship Program.
History: 25 Ky.R. 457; 815; eff. 10-1-1998; Crt eff. 9-28-2018; Crt eff. 2-28-2025.

11 KAR 14:060 Osteopathic Medicine Scholarship Program application of payments {#sec-11-kar-14-060 omnilex-key=us-ky-regs-official--title-11--11 KAR 14:060}

Section 1. Definitions.

(1) "Authority" is defined in KRS 164.740(1).

(3) "Disbursement" means the date the school indicates on the disbursement roster that funds were either credited to the student's account or disbursed to the student in accordance with 11 KAR 14:030, Section 2.

(4) "Full-time practice in the Commonwealth of Kentucky as a licensed doctor of osteopathy for a majority of the calendar year" means practicing in a qualified field for at least 2000 hours per calendar year.

(5) "Qualified field" means family practice, general practice, general internal medicine, general pediatrics, general obstetrics or gynecology.

(6) "Qualified service" is defined in KRS 164.7891(3)(c).

Section 2.

(1) The scholarship recipient shall immediately become liable for repayment of all outstanding promissory notes, including unpaid principal and interest accrued since the date of disbursement, if the scholarship recipient:

(a) Ceases enrollment at the school of osteopathic medicine prior to completion of the program of study;

(b) Begins, but fails to complete, an internship leading to licensure to provide qualified service;

(c)

Fails to begin a residency in a qualified field immediately following completion of the program of study at the school of osteopathic medicine or immediately following completion of an intervening internship; or
Begins, but fails to complete, a residency in a qualified field;

(d) Fails to obtain a license to practice osteopathic medicine in the Commonwealth; or

(e) Otherwise fails to perform qualified service in full-time practice in the Commonwealth of Kentucky as a licensed doctor of osteopathy for a majority of the calendar year after obtaining a license to practice osteopathic medicine.

(2) If the authority has reason to believe that an event specified in subsection (1) of this section has occurred, the authority shall send to the scholarship recipient's last known address written notification of demand for payment of all outstanding promissory notes, including unpaid principal and interest accrued since the date of disbursement, that shall be effective upon mailing.

(3) The authority may agree, in its sole discretion, to accept repayment in installments in accordance with a schedule established by the authority. If more than one (1) promissory note has come due for repayment and remains unpaid, payments shall first be applied to the earliest unpaid promissory note. Payments shall be applied first to accrued interest and then to principal.

Section 3. If the scholarship recipient obligated for repayment remits a partial payment, the payment shall first be applied to accrued interest and then to unpaid principal on the earliest unpaid promissory note and on each unpaid promissory note in the order in which the promissory notes were executed.

Section 4.

(1) The interest rate applicable to repayment of a promissory note under this program shall be six (6) percent per annum beginning April 1, 2005. Prior to April 1, 2005, the interest rate shall be twelve (12) percent per annum.

(2) If a repayment obligation subsequently becomes eligible for service credit cancellation as a result of the recipient's completion of an eligible program of study and provision of qualified service through full-time practice in the Commonwealth of Kentucky as a licensed doctor of osteopathy, refund of payments previously made shall not be given to the recipient.

Section 5. Default.

(2) A recipient whose repayment obligation has defaulted and who subsequently begins providing qualified service in the Commonwealth of Kentucky shall be removed from default status.

History

RELATES TO: KRS 164.7891
STATUTORY AUTHORITY: KRS 164.748(4), 164.7891(9)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.7891(9) requires the authority to promulgate administrative regulations for administration of the Osteopathic Medicine Scholarship Program. This administrative regulation establishes procedures for the application of payments made under the Osteopathic Medicine Scholarship Program.
History: 25 Ky.R. 459; 815; eff. 10-1-1998; 26 Ky.R. 1434; eff. 3-10-2000; 28 Ky.R. 657; eff. 11-5-2001; 30 Ky.R. 365; 839; eff. 10-31-2003; 31 Ky.R. 1323; 1508; eff. 3-11-2005; 35 Ky.R. 957; 1428; eff. 1-5-2009; Crt eff. 9-28-2018; Crt eff. 2-28-2025.

11 KAR 14:070 Osteopathic Medicine Scholarship Program notifications {#sec-11-kar-14-070 omnilex-key=us-ky-regs-official--title-11--11 KAR 14:070}

Section 1. Definitions.

(1) "Authority" is defined in KRS 164.740(1).

(2) "Full-time practice in the Commonwealth of Kentucky as a licensed doctor of osteopathy for a majority of the calendar year" means practicing in a qualified field for at least 2000 hours per calendar year.

(3) "Qualified field" means family practice, general practice, general internal medicine, general pediatrics, general obstetrics or gynecology.

(4) "Qualified service" is defined in KRS 164.7891(3)(c).

Section 2. A scholarship recipient shall notify the authority in writing within thirty (30) days of:

(1) Cessation of full-time enrollment in the osteopathic medicine program;

(2) Commencement or cessation of an internship leading to licensure in the Commonwealth of Kentucky to provide qualified service;

(3) Completion or failure to complete a residency requirement in a qualified field;

(4) Licensure to practice osteopathic medicine in the Commonwealth of Kentucky;

(5) Failure to obtain a license to practice osteopathic medicine in the Commonwealth of Kentucky;

(6) Employment in a qualified service position;

(7) Failure, within 180 days following licensure to practice osteopathic medicine in the Commonwealth of Kentucky, to obtain employment in full-time practice in the Commonwealth of Kentucky as a licensed doctor of osteopathy for a majority of the calendar year in a qualified field; or

(8) Change of name, permanent home address, or place of employment.

Section 3. The school of osteopathic medicine shall notify the authority in writing within thirty (30) days of learning that an Osteopathic Medicine Scholarship recipient:

(1) Ceases to be enrolled on a full-time basis at the school of osteopathic medicine;

(2) Commences or fails to complete an internship leading to licensure to provide qualified service; or

(3) Commences or fails to complete a residency requirement.

History

RELATES TO: KRS 164.7891
STATUTORY AUTHORITY: KRS 164.748(4), 164.7891(9)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.7891(9) requires the authority to promulgate administrative regulations for administration of the Osteopathic Medicine Scholarship Program. This administrative regulation establishes the obligation of the scholarship recipient and the school of osteopathic medicine to notify the authority of a change in enrollment status, employment in a qualified service position, and change of name or address.
History: 25 Ky.R. 460; 815; eff. 10-1-1998; 28 Ky.R. 659; 1107; eff. 11-5-2001; Crt eff. 9-28-2018; Crt eff. 2-28-2025.

11 KAR 14:080 Deferment of Osteopathic Medicine Scholarship Program repayment {#sec-11-kar-14-080 omnilex-key=us-ky-regs-official--title-11--11 KAR 14:080}

Section 1. Definitions.

(1) "Authority" is defined in KRS 164.740(1).

(3) "Deferment" means a temporary waiver of the obligation of an osteopathic medicine scholarship recipient to make payments to the authority pursuant to one (1) or more promissory notes, executed between the recipient and the authority, which is granted by the authority, for a specified period of time, upon a showing of cause by the recipient.

(5) "Qualified field" means family practice, general practice, general internal medicine, general pediatrics, general obstetrics or gynecology.

(6) "Qualified service" is defined in KRS 164.7891(3)(c).

Section 2. Request for Deferment.

(1) The osteopathic medicine scholarship recipient shall request a deferment in writing by submitting to the authority complete and accurate information verifying the recipient's circumstances that qualify for deferment in accordance with this administrative regulation.

(2) The recipient's submission of a request for deferment shall constitute authorization for the authority to request and receive from a third-party verification of facts represented by the recipient.

Section 3. Effect on Repayment.

(1) During a deferment:

(a) A principal or interest repayment shall not be required; and

(b) Interest shall continue to accrue on the unpaid principal balance owed by the recipient during the period specified in Section 4(4) of this administrative regulation.

(2) The authority shall not grant a deferment if a deferment would legally impair the ultimate recovery of the principal and accrued interest otherwise owed by the recipient.

(3) A promissory note for which repayment is deferred in accordance with this administrative regulation shall subsequently be cancelled in accordance with KRS 164.7891(5) if the osteopathic medicine scholarship recipient resumes full-time enrollment in an accredited program of study at a school of osteopathic medicine located in the Commonwealth or renders qualified service.

Section 4. Types of Deferments. Except as provided in subsection (5) of this section, the authority shall grant deferment of repayment for a period of twelve (12) months, not to exceed an aggregate of thirty-six (36) months, excluding military service deferment or an internship and residency deferment, for the circumstances described in this section.

(1) Disability deferment.

(a) A deferment may be granted to an osteopathic medicine scholarship recipient who is:

Temporarily totally disabled and, therefore, unable to attend school or perform qualified service; or
Unable to attend school or perform qualified service due to the temporary, total disability of the osteopathic medicine scholarship recipient's spouse who requires continuous (twenty-four (24) hour) nursing or similar care by the recipient.

(b) For purposes of this deferment, an osteopathic medicine scholarship recipient, or the spouse of a recipient, shall be considered temporarily totally disabled if he suffers an injury or illness which necessitates an extended or indefinite period of recovery which can be expected to preclude school attendance or employment and, in case of a recipient's spouse, he is not confined to a hospital, nursing home, intermediate care facility, or similar institution.

(c) The recipient shall provide to the authority a statement from a licensed physician (other than the osteopathic medicine scholarship recipient) certifying that the recipient or spouse is temporarily totally disabled in accordance with the requirements established in paragraph (b) of this subsection. The recipient shall be solely responsible for securing the physician's certification and ensuring that it is received by the authority.

(d) If the deferment is granted for a period of less than one (1) year at a time, the deferment shall be subject to periodic review of a physician's certification every six (6) months.

(e) After the third year of a recipient's deferment, pursuant to this subsection, the authority shall cancel the debt if it reasonably appears to the authority based on the certification of a licensed physician other than the scholarship recipient that the scholarship recipient is totally disabled and the disability is expected to be permanent and continue to preclude the scholarship recipient's school attendance and employment for an indefinite time.

(2) Hardship deferment.

(a) The authority shall determine that a hardship exists and grant a hardship deferment if:

Enrollment in an accredited program at a school of osteopathic medicine located in the Commonwealth or performance of qualified service is temporarily interrupted due to circumstances beyond the recipient's control, including natural disaster or death in the family, after which the recipient intends to resume the enrollment or qualified service position; or
The recipient is insolvent due to circumstances beyond his control, including natural disaster, involuntary unemployment, or unforeseen medical expenses.

(b) This deferment shall:

Be granted for a period of less than one (1) year; and
Be subject to periodic review of documentation every six (6) months.

(4) Internship and residency deferment.

(a)

An osteopathic medicine scholarship recipient shall receive a deferment during the normal term of service in a single American Osteopathic Association approved rotating internship in osteopathic medicine prior to beginning practice in osteopathic medicine.
An osteopathic medicine scholarship recipient shall receive a deferment during the normal term of service in:

a. A single American Osteopathic Association approved residency program in a qualified field; or

b. The Family Practice plus One year Neuromuscular Medicine (FP+1) residency program.

(b) The recipient shall submit to the authority verification that he is enrolled in the internship or residency program, the start date, and anticipated end date of the internship or residency from the hospital, clinic, or other institution where the internship or residency is being performed.

The recipient's name, Social Security number, current home address, and telephone number;
The name and address of the hospital, clinic, or other institution where the internship or residency is being performed;
The name, title, address, telephone number, and signature on a statement of certification or verification of the person supervising the recipient's internship or residency program; and
The expected date that the internship or residency program will be completed.

(d) A recipient whose period of obligated service has been deferred under this subsection shall begin full-time practice in the Commonwealth of Kentucky as a licensed doctor of osteopathy for a majority of the calendar year in a qualified field immediately following the completion of the initial residency period and licensure to practice osteopathic medicine in the Commonwealth of Kentucky.

(5) Upon default of a repayment obligation under this program, a recipient shall be permanently barred from eligibility for all other deferments provided for in this administrative regulation.

History

RELATES TO: KRS 164.740, 164.7891
STATUTORY AUTHORITY: KRS 164.7891(9)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.7891(9) requires the authority to promulgate administrative regulations for administration of the Osteopathic Medicine Scholarship Program. This administrative regulation establishes conditions for deferment of the repayment obligation under the Osteopathic Medicine Scholarship Program.
History: 25 Ky.R. 462; 815; eff. 10-1-1998; 28 Ky.R. 660; 1108; eff. 11-5-2001; 33 Ky.R. 1873; 2929; eff. 4-6-2007; 34 Ky.R. 1769; 2078; eff. 4-4-2008; 35 Ky.R. 959; 1429; 1-5-2009; Crt eff. 9-28-2018; Crt eff. 2-28-2025.

Chapter 15 Kentucky Educational Excellence Scholarship Program

11 KAR 15:010 Definitions for 11 KAR Chapter 15 {#sec-11-kar-15-010 omnilex-key=us-ky-regs-official--title-11--11 KAR 15:010}

Section 1. Definitions.

(1) "Academic term" is defined in KRS 164.7874(1) and 13 KAR 2:045, Section 1(1).

(2) "Academic year" is defined in KRS 164.7884(1).

(3) "ACT score" is defined in KRS 164.7874(3).

(4) "Apprentice" is defined in KRS 164.7884(1).

(5) "Authority" is defined in KRS 164.7874(4).

(6) "Award period" is defined in KRS 164.7874(5).

(7) "Correspondence course" means a home study course that:

(b) Meets the following requirements:

When a student completes a portion of the instructional materials, the student takes the examinations that relate to that portion of the materials and returns the examinations to the institution for grading;
The institution provides instruction through the use of video cassettes or video discs in an academic year unless the institution also delivers the instruction on the cassette or disc to students physically attending classes at an institution during the same academic year; and
If a course is part correspondence and part residential training, the course shall be considered to be a correspondence course; and

(8) "Council" is defined in KRS 164.7874(6).

(9) "Cumulative grade point average" means the total grade point average for a postsecondary education student as reported by the postsecondary education institution where the student is currently enrolled.

(10) "Eligible high school student" is defined in KRS 164.7874(7).

(11) "Eligible postsecondary student" is defined in KRS 164.7874(8).

(12) "Eligible program of study" means, for purposes of enrollment in a participating institution, a postsecondary undergraduate program that:

(a)

Leads to a certificate, diploma, or associate or baccalaureate degree;
Is designated as an equivalent undergraduate program of study by the council in an administrative regulation; or
Is a degree program in a field of study that is not available at any participating institution in the Commonwealth but is offered at an out-of-state institution designated by the council as an approved participating institution; and

(b) May include study abroad or away from the main campus if the student pays tuition to, and is given academic credit by, the participating institution for the study, except that a correspondence course shall not be included.

(13) "Eligible student" is defined in KRS 164.7884(1).

(14) "Full-time student" is defined in KRS 164.7874(9).

(15) "Grade point average" is defined in KRS 164.7874(10).

(16) "High school" is defined in KRS 164.7874(11).

(17) "KEES" or "Kentucky Educational Excellence Scholarship" is defined in KRS 164.7874(12).

(18) "KEES Program officer" means the official designated on the administrative agreement, pursuant to KRS 164.748(6) and 164.7874(20), to serve as the participating institution's on-campus agent to certify all institutional transactions and activities with respect to the Kentucky Educational Excellence Scholarship Program.

(19) "Maximum award amount" means the KEES award maximum defined by KRS 164.7874(14).

(20) "Participating institution" is defined in KRS 164.7874(20).

(21) "Part-time student" is defined in KRS 164.7874(21).

(22) "Registered apprenticeship program" is defined in KRS 164.7884(1).

(23) "Related instruction" is defined in KRS 164.7884(1).

(24) "Sponsor" is defined in KRS 164.7884(1).

(25) "Supplemental award" means the KEES supplemental amount defined by KRS 164.7874(17).

History

RELATES TO: KRS 164.7871-164.7885, 20 U.S.C. 1087ll
STATUTORY AUTHORITY: KRS 164.748(4), 164.7885(7)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.748(4) requires the authority to promulgate administrative regulations pertaining to the awarding of grants, scholarships, and honorary scholarships as provided in KRS 164.740 to 164.7891. KRS 164.7885(7) authorizes the authority to promulgate administrative regulations for the administration of the Kentucky Educational Excellence Scholarship Program. This administrative regulation establishes the definitions for 11 KAR Chapter 15.
History: 25 Ky.R. 464; 816; eff. 10-1-1998; 27 Ky.R. 1036; 1440; eff. 12-21-2000; 29 Ky.R. 170; eff. 9-9-2002; 30 Ky.R. 366; 840; eff. 10-31-2003; 41 Ky.R. 2102; 2538; eff. 7-6-2015; Crt eff. 9-28-2018.; 45 Ky.R. 106, 626; eff. 10-5-2018; Crt eff. 2-28-2025

11 KAR 15:020 Student eligibility report {#sec-11-kar-15-020 omnilex-key=us-ky-regs-official--title-11--11 KAR 15:020}

Section 1. Initial Eligibility Verification.

(1) The participating institution shall submit to the authority an eligibility verification file after the beginning of the academic term.

(a) For each eligible student, the eligibility verification file shall contain:

The student's name and Social Security number;
The full-time or part-time enrollment status, measured in credit hours or credit hour equivalent; and
The student's highest ACT score attained by the date of graduation from high school unless the authority receives the ACT score directly from the testing services.

(b) The KEES program officer shall certify the eligibility of the eligible postsecondary student and transmit the file electronically to the authority according to instructions provided by the authority in accordance with subsection (2) of this section.

(2) The instructions provided by the authority shall specify:

(a) Conditions under which KEES funds shall be disbursed to the benefit of the eligible postsecondary student pursuant to 11 KAR 15:050; and

(b) Conditions under which KEES funds shall be returned to the authority pursuant to 11 KAR 15:060.

(3)

(a) A participating institution that does not submit an eligibility verification file according to the instructions shall not receive KEES funds until it has satisfied the requirements in subsection (1) of this section.

(b) The authority may withhold any services and funds from the participating institution until the file and all funds advanced, that remain undisbursed to eligible postsecondary students, are received by the authority.

Section 2. Renewal Eligibility Verification.

(1) The participating institution shall electronically submit to the authority a renewal eligibility file not later than June 30 after the completion of the award period. The renewal eligibility file shall contain the name, Social Security number, on track to graduate status, and the cumulative grade point average for all eligible students.

(2) A participating institution that does not submit a renewal eligibility file by June 30 shall not receive KEES funds until it has satisfied the requirement in subsection (1) of this section. The authority may withhold any service and funds from the participating institution and initiate action to terminate, suspend or limit participation of the institution pursuant to 11 KAR 4:020 until the file is received by the authority.

History

RELATES TO: KRS 164.7885(4)
STATUTORY AUTHORITY: KRS 164.748(4), 164.7885(7)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.748(4) requires the authority to promulgate administrative regulations pertaining to the awarding of grants, scholarships, and honorary scholarships as provided in KRS 164.740 to 164.785. KRS 164.7885(7) requires the authority to promulgate administrative regulations for the administration of the Kentucky Educational Excellence Scholarship Program. This administrative regulation establishes the procedure for a participating institution to report renewal eligibility of a student for a Kentucky Educational Excellence Scholarship.
History: 25 Ky.R. 465; 817; eff. 10-1-1998; 27 Ky.R. 1037; 1440; eff. 12-21-2000; 40 Ky.R. 1129; eff. 1-28-2014; Crt eff. 9-28-2018; Crt eff. 2-28-2025.

11 KAR 15:030 Dual enrollment under consortium agreement {#sec-11-kar-15-030 omnilex-key=us-ky-regs-official--title-11--11 KAR 15:030}

Section 1. For purposes of the Kentucky Educational Excellence Scholarship program, a student who is otherwise eligible pursuant to KRS 164.7871 through 164.7885 and is enrolled simultaneously in two (2) or more participating institutions pursuing a program of study jointly offered by those institutions, shall be eligible under this section if:

(1) The eligible program of study is covered by a consortium agreement between the participating institutions; and

(2) The eligible postsecondary student is carrying a combined academic workload at all participating institutions in the consortium equal to at least half-time enrollment at the primary institution.

Section 2. Consortium Agreement. Two (2) or more participating institutions in the Kentucky Educational Excellence Scholarship Program shall, for purposes of Section 1 of this administrative regulation, execute a consortium agreement which meets at least the following terms and conditions:

(1) The agreement shall be written and signed by authorized representatives of each participating institution;

(2) The agreement shall designate which participating institution will serve as the "primary" institution; and

(3) The agreement shall specify that the primary institution shall perform the duties set forth in Section 3 of this administrative regulation.

(1) Maintain all records, including information from all participating institutions about the eligible postsecondary student's grades, institutional costs incurred, financial aid received, enrollment, and all other information related to the student's eligibility as is required to be maintained on any other KEES recipient enrolled in the primary institution;

(2) Disburse the Kentucky Educational Excellence Scholarship to the eligible postsecondary student;

(3) Confer academic credit to the eligible postsecondary student for all courses completed at other participating institutions under the consortium agreement as if the courses had been provided by the primary institution;

(4) Monitor the eligible postsecondary student's enrollment status at all participating institutions in the consortium and indicate the student's enrollment at the primary institution as the equivalent of the combined enrollment at all participating institutions in the consortium;

(5) Calculate any refund or repayment and make an applicable refund based on the primary institution's refund policy, as provided in 11 KAR 15:060 based upon a change in enrollment at a participating institution in the consortium, as if the student were enrolled at the primary institution; and

(6) Provide to the authority, on behalf of all participating institutions in the consortium, all required reports and notifications as if the eligible postsecondary student were enrolled only at the primary institution.

Section 4. The consortium agreement may contain other terms or conditions, not inconsistent with this administrative regulation, as may be deemed necessary or appropriate by the participating institutions.

History

RELATES TO: KRS 164.7871-164.7885
STATUTORY AUTHORITY: KRS 164.748(4), 164.7885(7)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.748(4) requires the authority to promulgate administrative regulations pertaining to the awarding of grants, scholarships, and honorary scholarships as provided in KRS 164.740 to 164.785. KRS 164.7885(7) authorizes the authority to promulgate administrative regulations for the administration of the Kentucky Educational Excellence Scholarship Program. This administrative regulation establishes the conditions for KEES eligibility for a student simultaneously enrolled in two (2) or more participating institutions.
History: 25 Ky.R. 467; 817; eff. 10-1-1998; 27 Ky.R. 1039; eff. 12-21-2000; Crt eff. 9-28-2018; Crt eff. 2-28-2025.

11 KAR 15:040 Kentucky Educational Excellence Scholarship award determination procedure {#sec-11-kar-15-040 omnilex-key=us-ky-regs-official--title-11--11 KAR 15:040}

Section 1. Reduction for Part-time Study.

(1) If an eligible student is enrolled as a part-time student for an academic term, the maximum award amount to which the student is entitled shall be one-half of the maximum annual award prorated as follows:

(a) Fifty (50) percent if enrolled for six (6) semester hours;

(b) Fifty-eight (58) percent if enrolled for seven (7) semester hours;

(d) Seventy-five (75) percent if enrolled for nine (9) semester hours;

(e) Eighty-three (83) percent if enrolled for ten (10) semester hours;

(f) Ninety-two (92) percent if enrolled for eleven (11) semester hours; and

(g) 100 percent if enrolled for twelve (12) semester hours or more.

(2) For a quarter hour institution, in order to determine the maximum award amount to which the student is entitled, the number of quarter hours of the student's enrollment shall be converted to semester hours on either a semester or academic year basis as follows:

(a) Quarter to semester hour conversion per semester for periods July 1 - December 31 and January 1 – June 30

(b) Quarter to semester hour conversion per academic year for periods July 1 – June 30

(3) The equivalent academic unit of measurement shall be used to correspond to a semester hour, if the participating institution does not use semester hours.

(4) A participating institution shall determine full-time and less than full-time enrollment status for purposes of subsection (1) of this section in the same manner as the participating institution uses to determine enrollment status for Pell Grant eligibility.

History

RELATES TO: KRS 164.7881(4)
STATUTORY AUTHORITY: KRS 164.748(4), 164.7881(4)(b), 164.7885(7)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.748(4) requires the authority to promulgate administrative regulations pertaining to the awarding of grants, scholarships, and honorary scholarships as provided in KRS 164.740 to 164.785. KRS 164.7885(7) authorizes the authority to promulgate administrative regulations for the administration of the Commonwealth Merit Scholarship Program, renamed Kentucky Educational Excellence Scholarship (KEES) Program by EO 98-1592. KRS 164.7881(4)(b) requires the authority to promulgate an administrative regulation to proportionately reduce the maximum award amount for an eligible student enrolled part-time. This administrative regulation establishes the conditions for KEES eligibility for eligible students enrolled on a part-time basis.
History: 25 Ky.R. 468; 818; eff. 10-1-1998; 25 Ky.R. 2923; eff. 9-1-1999; 40 Ky.R. 82; 531; eff. 9-9-2013; Cert eff. 9-28-2018; 50 Ky.R. 69; eff. 12-11-2023.

11 KAR 15:050 Disbursement {#sec-11-kar-15-050 omnilex-key=us-ky-regs-official--title-11--11 KAR 15:050}

Section 1. Disbursement of Funds.

(1) KEES funds shall be disbursed by the authority to the participating institution in the form of a single check, made payable to the participating institution, or by electronic funds transfer delivered to the participating institution for subsequent delivery to the eligible postsecondary student.

(2) Within thirty (30) days following receipt of the eligibility verification file, the disbursement of KEES funds by the authority to the participating institution shall be made for subsequent delivery by the institution to an eligible postsecondary student.

Section 2. Delivery of funds by the participating institution.

(1) The participating institution shall be responsible for proper delivery of KEES funds. The participating institution shall not make KEES funds available to the eligible postsecondary student nor apply the funds to the recipient's account prior to the date that the eligible postsecondary student has completed the registration requirements (except for the payment of tuition and fees) at the participating institution for the academic term for which the Kentucky Educational Excellence Scholarship is disbursed.

(2) The participating institution shall be liable for delivery to the wrong person or to an ineligible student and shall make restitution to the authority of an amount improperly delivered. Failure of the participating institution to make restitution as required shall, without precluding other remedies, be deemed cause for limitation, suspension, or termination of the participation of the institution in accordance with 11 KAR 4:020.

History

RELATES TO: KRS 164.7885(4)
STATUTORY AUTHORITY: KRS 164.748(4), 164.7885(7)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.748(4) requires the authority to promulgate administrative regulations pertaining to the awarding of grants, scholarships, and honorary scholarships as provided in KRS 164.740 to 164.785. KRS 164.7885(7) requires the authority to promulgate administrative regulations for the administration of the Kentucky Educational Excellence Scholarship Program. This administrative regulation establishes the disbursement procedures for Kentucky Educational Excellence scholarships.
History: 25 Ky.R. 470; 818; eff. 10-1-1998; 27 Ky.R. 1040; eff. 12-21-2000; Crt eff. 9-28-2018; Crt eff. 2-28-2025.

11 KAR 15:060 Kentucky Educational Excellence Scholarship overpayment and refund and repayment procedure {#sec-11-kar-15-060 omnilex-key=us-ky-regs-official--title-11--11 KAR 15:060}

Section 1.

(1) If a student who earned a Kentucky Educational Excellence Scholarship (KEES) or supplemental award, fails to enroll, withdraws, is expelled from the institution, or otherwise fails to complete the program on or after his first day of class of the period of enrollment or changes enrollment status, the student may be due a refund of monies paid to the institution on behalf of that student or may owe a repayment of cash disbursements made to the student for educational expenses.

(2) If the student received a Kentucky Educational Excellence Scholarship or supplemental award, all or a portion of the refund and repayment shall be due to the authority for its financial assistance programs in accordance with Sections 2 and 3 of this administrative regulation.

Section 2.

(1) The institution shall adopt and implement a fair and equitable refund and repayment policy for financial assistance administered by the authority which shall be:

(a) A clear and conspicuous written statement;

(b) Made available to a prospective student, prior to the earlier of the student's enrollment or the execution of the student's enrollment agreement, and to currently-enrolled students;

(d) Made available to the authority upon request.

(a) The requirements of applicable state law; or

(b) The specific refund standards established by the institution's nationally-recognized accrediting agency.

(a) CAP grant;

(b) KTG;

(d) Teacher Scholarship;

(e) Kentucky Educational Excellence Scholarship;

(f) Kentucky Coal County College Completion Scholarship;

(g) National Guard tuition assistance; and

(h) Early Childhood Development Scholarship;

Section 3.

(1) If a KEES recipient officially or unofficially withdraws from or is expelled by an institution before the first day of classes of the award period, the award shall be deemed an overaward and a full refund or repayment of the KEES award shall be required, notwithstanding any institutional policy to the contrary.

(2) If the institution is unable to document the student's last date of attendance, any KEES disbursement for that award period shall be subject to full refund and repayment.

(3) If, at any time, a KEES recipient's enrollment is terminated with no assessment of tuition and fees by the institution, then the full KEES award shall be subject to cancellation, if not yet disbursed, or refund and repayment if the grant has already been disbursed.

Section 4.

(1) If a student earned a Kentucky Educational Excellence Scholarship or supplemental award but did not earn the entire amount of award funds the participating institution applies to the student's account or disburses to the student for an academic term, the participating institution and the student shall be jointly and severally liable to repay to the authority the amount of the overpayment.

(2) If a student did not earn a Kentucky Educational Excellence Scholarship or supplemental award and the participating institution applies to that student's account or disburses to that student Kentucky Educational Excellence Scholarship or supplemental award funds for an academic term, the participating institution and the student shall be jointly and severally liable to repay to the authority the entire amount of Kentucky Educational Excellence Scholarship and supplemental award funds applied to that student's account and disbursed to that student.

Section 5. The institution shall remit to the authority the amount of funds allocated from the refund amount to the financial assistance programs administered by the authority as soon as possible but no later than thirty (30) days after the end of the term in which the student ceased to be enrolled.

Section 6.

(1) If a refund is due from the participating institution or a repayment is due from a student, the participating institution shall transmit to the authority the refund and shall report:

(a) The student's name and Social Security number;

(b) The reason for the refund or repayment;

(d) The academic term and award period; and

(e) The calculation used for determining the refund or repayment.

(2) Failure of the institution to make restitution when required shall, without precluding other remedies, be cause for limitation, suspension, or termination of the participation of the institution in accordance with 11 KAR 4:020.

History

RELATES TO: KRS 164.7871-164.7885
STATUTORY AUTHORITY: KRS 164.748(4), 164.7885(7)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.748(4) requires the authority to promulgate administrative regulations pertaining to the awarding of grants, scholarships, and honorary scholarships as provided in KRS 164.740 to 164.7891. KRS 164.7885(7) authorizes the authority to promulgate administrative regulations for the administration of the Kentucky Educational Excellence Scholarship Program. This administrative regulation establishes the conditions and procedures for refund or repayment of Kentucky Educational Excellence Scholarship funds.
History: 25 Ky.R. 472; 819; eff. 10-1-1998; 26 Ky.R. 2290; eff. 8-14-2000; 27 Ky.R. 3316; eff. 8-15-2001; 41 Ky.R. 839; 1500; eff. 2-6-2015; Crt eff. 9-28-2018; Crt eff. 2-28-2025.

11 KAR 15:070 Records and reports {#sec-11-kar-15-070 omnilex-key=us-ky-regs-official--title-11--11 KAR 15:070}

Section 1. A participating institution shall:

(1) Establish an organized system of records pertaining to Kentucky Educational Excellence Scholarship recipient eligibility;

(2) Maintain these records for a period of not less than three (3) years after the award year in which the recipient ceased enrollment; and

(3) Upon request, make available to the authority:

(a) All records relied upon by that institution to certify that a recipient of funds from the authority is an eligible postsecondary student; and

(b) Information necessary to verify that the institution has complied with 11 KAR Chapter 15, and representations and requirements contained in its administrative agreement with the authority.

History

RELATES TO: KRS 164.7871-164.7885
STATUTORY AUTHORITY: KRS 164.748(4), 164.7885(7)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.748(4) requires the authority to promulgate administrative regulations pertaining to the awarding of grants, scholarships, and honorary scholarships as provided in KRS 164.740 to 164.785. KRS 164.7885(7) authorizes the authority to promulgate administrative regulations for the administration of the Kentucky Educational Excellence Scholarship Program. This administrative regulation establishes the conditions and procedures for a participating institution to maintain records and make available to the authority records and reports necessary to the implementation of the Kentucky Educational Excellence Scholarship Program.
History: 25 Ky.R. 474; 819; eff. 10-1-1998; 27 Ky.R. 1042; 1441; eff. 12-21-2000; Crt eff. 9-28-2018; Crt eff. 2-28-2025.

11 KAR 15:080 High school reporting {#sec-11-kar-15-080 omnilex-key=us-ky-regs-official--title-11--11 KAR 15:080}

Section 1. The high school shall submit additions, changes, or corrections to a student's high school grade point average or ACT score to the authority not later than three (3) months after an eligible postsecondary student begins enrollment at a participating institution for the first time after graduation from high school. The authority shall not accept any additions, changes, or corrections to a student's high school grade point average or ACT score submitted by the high school after that date and the student's eligibility shall be determined based on that information as of that date except that ineligibility for this reason may be waived by the executive director of the authority, at the recommendation of a designated staff review committee, for cause.

History

RELATES TO: KRS 164.7885(4)
STATUTORY AUTHORITY: KRS 164.748(4), 164.7885(7)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.748(4) requires the authority to promulgate administrative regulations pertaining to the awarding of grants, scholarships, and honorary scholarships as provided in KRS 164.740 to 164.785. KRS 164.7885(7) requires the authority to promulgate administrative regulations for the administration of the Kentucky Educational Excellence Scholarship Program. This administrative regulation establishes the deadline for high schools to report changes in KEES data to the authority.
History: 29 Ky.R. 199; 703; eff. 9-9-2002; Crt eff. 9-28-2018; Crt eff. 2-28-2025.

11 KAR 15:090 Kentucky Educational Excellence Scholarship (KEES) program {#sec-11-kar-15-090 omnilex-key=us-ky-regs-official--title-11--11 KAR 15:090}

Section 1. Definitions.

(1) "Academic term":

(a) Means the fall or spring semester or their equivalence under a trimester or quarter system at a postsecondary education institution; and

(b) Does not mean summer sessions.

(2) "Accredited out-of-state high school" means a high school that is:

(a) Located in a state other than Kentucky or in another country; and

(b) A member of an organization belonging to the Commission on International and Trans-Regional Accreditation.

(3) "ACT" means the test:

(a) Administered to a student for entrance to a Kentucky postsecondary education institution; and

(b) Owned by the ACT Corporation of Iowa City, Iowa.

(4) "Advanced placement" or "AP" is defined by KRS 164.002(1).

(5) "Cambridge Advanced International" or "CAI" is defined by KRS 164.002(2).

(6) "Course" means the equivalent of one (1) credit as determined by the Kentucky Department of Education (KDE) in 704 KAR 3:305.

(7) "Department of Defense school" means a school operated by the U.S. Department of Defense for the purpose of providing a high school education to a child whose custodial parent or guardian is in active military or diplomatic service in a state other than Kentucky or in another country.

(8) "Dual credit" is defined by KRS 158.007(8).

(9) "Enrolled" means the status of a student who has completed the registration requirements, except for the payment of tuition and fees, at a participating postsecondary education institution that the student is attending.

(10) "Free and reduced price lunch" means the National School Lunch program established by the United States Department of Agriculture, Richard B. Russell National School Lunch Act, 42 U.S.C. 1751, et. seq., to provide subsidized meals to lower income students.

(11) "GED" means a general educational development diploma awarded to a student.

(12) "International Baccalaureate" or "IB" is defined by KRS 164.002(7).

(13) "SAT" means the test:

(a) Administered to a student for entrance to a Kentucky postsecondary education institution; and

(b) Owned by the College Board.

Section 2. High School Grade Point Average Calculation and Reporting.

(1) An eligible high school student's grade point average for an academic year shall be calculated using each letter grade awarded for all courses taken during an academic year. The grading scale cutoff scores used to determine the letter grade for each course shall be the same as those used to determine the letter grade for each course reported on the student's official high school transcript.

(2)

(a) Except as established in paragraphs (b) and (c) of this subsection, an eligible high school student's grade point average shall be calculated by:

Taking the number of units in a course multiplied by the course grade as expressed on a 4.0 point grading scale where 4.0 is an "A", 3.0 is a "B", 2.0 is a "C", 1.0 is a "D", and 0.0 is an "F";
Adding the total number of points accumulated for an academic year; and
Dividing the total number of points accumulated in subparagraph 2 of this paragraph by the total number of units for the academic year.

(b) For an eligible high school student taking an AP, IB, or CAI course during the academic year, the course grade assigned shall be calculated using a 5.0 point scale where 5.0 is an "A", 4.0 is a "B", 3.0 is a "C", 2.0 is a "D", and 1.0 is an "F".

(c) Beginning with the academic year 2015-2016, for an eligible high school student taking a dual credit course during the academic year, the course grade assigned by the college shall be used by the high school in calculating the KEES grade point average, and shall be included in the KEES calculation using a 5.0 point scale where 5.0 is an "A", 4.0 is a "B", 3.0 is a "C", 2.0 is a "D", and 1.0 is an "F". This weighted scale shall not be applicable to a remedial course.

(3) The grade point average reported for an eligible high school student for each academic year shall include all information as established in KRS 164.7885(1) and be submitted to the authority in either an electronic or hard copy format.

(4) A high school student who participated in an educational high school foreign exchange program or the Congressional Page School that was approved by the student's local high school shall have the student's grade point average reported in accordance with KRS 164.7879(2)(b).

Section 3. High School Students of Custodial Parents or Guardians in Active Military Service.

(1)

(a) For purpose of determining eligibility under the provisions of KRS 164.7879(2)(c), a high school student shall establish that the custodial parent or guardian meets the requirements of KRS 164.7879(2)(c)1.a. and b. and shall submit to the authority documentation demonstrating that the custodial parent or guardian:

Is in active service in the U.S. Armed Forces; and
Has been transferred by the U.S. Armed Forces from a Kentucky location to a non-Kentucky location.

(b) The authority annually shall notify the eligible high school student and the custodial parent or guardian of the student's eligibility.

(2)

(a) A high school student, determined to be eligible for the KEES program under the terms of KRS 164.7879(2)(c) and subsection (1)(a) of this section, shall be responsible for requesting:

Grade and curriculum information from the local school; and
That the local school submit the information to the authority using the Curriculum Certification form and the Data Submission form.

(b) Upon receipt of curriculum and grade information from an accredited out-of-state high school or Department of Defense school for a student determined to be eligible for the KEES Program under this section, the authority shall:

Verify that the submitted curriculum meets the requirements of Section 4 of this administrative regulation;
Verify that the out-of-state high school or Department of Defense school is an accredited high school; and
Retain the Curriculum Certification form on file until the student's eligibility has expired.

Section 4. Postsecondary Student Eligibility and KEES Curriculum.

(1) A Kentucky postsecondary student shall be eligible to receive a base scholarship award if the student:

(a) Has earned a base scholarship award in high school;

(b) Has completed the KEES curriculum as established in subsection (2) of this section;

(c) Has graduated from a Kentucky high school, except as established in Section 2(4) or 3 of this administrative regulation; and

(d) Is enrolled in a participating institution in an eligible program.

(2) Except as established in subsection (4) of this section, the KEES curriculum shall consist of the curriculum standards established in 704 KAR 3:305.

(3) A student who graduates from high school at the end of the fall semester of his or her senior year and who meets the requirements of KRS 164.7874(7) shall be eligible to earn a KEES award for that year upon:

(a) Completion of no fewer than three (3) courses of study; and

(b) Satisfying the provisions of KRS 164.7879.

(4) Except as established in subsection (5) of this section, a high school may substitute an integrated, applied, interdisciplinary, or higher level course for a required course or required academic and career interest standards-based learning experience if the course:

(a) Provides the same or greater academic rigor and the course covers or exceeds the minimum required content areas established in 703 KAR 5:270; or

(b) Is an honors course, cooperative education course, AP course, IB course, CAI course, dual credit course, or a course taken at a postsecondary education institution.

(5) Beginning with the 2018-2019 academic year, each cooperative education course taken during an academic year shall satisfy KEES curriculum requirements if the course has been approved by the Office of Career and Technical Education as a work-based learning experience in a career pathway pursuant to 705 KAR 4:231 and 705 KAR 4:041. For all other cooperative education coursework, only one (1) course per academic year shall count for purposes of satisfying KEES curriculum requirements.

(6) A high school annually shall provide written documentation to a student advising if the student's schedule of coursework meets the requirements of the KEES curriculum.

Section 5. Eligible Postsecondary Education Programs.

(1) An eligible program shall be a certificate or degree program offered by a participating institution and recognized by the authority pursuant to 11 KAR 15:010, Section 1(12).

(2) Except as established in subsection (3) of this section, an eligible program at an out-of-state participating institution shall be limited to those programs that qualify through the Academic Common Market administered by the Southern Regional Education Board.

(3) Pursuant to KRS 164.7881(4)(c)1, an academic program shall be designated as an equivalent undergraduate program of study if the student in the program of study:

(a) Has not received eight (8) academic terms of a KEES award;

(b) Is classified by an institution as a graduate or professional student and is enrolled in one (1) of the following academic programs:

Pharm. D;
A veterinary medicine program at an institution that participates in the Kentucky Contract Spaces Program; or
An optometric medicine program at an institution that participates in the Optometry Scholarship Program; and

Section 6. Postsecondary Grade Point Average Calculation and Reporting.

(1) Each participating institution shall report to the authority, the cumulative grade point average for each KEES recipient enrolled in that institution no later than June 30 after the completion of the award period.

(2) The cumulative grade point average shall be reported to the hundredths decimal place. Any cumulative grade point average that contains a number of five (5) or greater in the thousandths place shall be rounded up to the nearest hundredth. Any cumulative grade point average that contains a number less than five (5) in the thousandths place shall be rounded down to the nearest hundredth.

(3) If a KEES recipient had an incomplete grade when the cumulative grade point average was initially reported to the authority and subsequently receives a final grade, the participating institution shall recalculate the recipient's cumulative grade point average as of the end of the appropriate award period and report the updated cumulative grade point average to the authority.

Section 7. SAT Conversion Table.

(1) Pursuant to KRS 164.7874(3), the SAT to ACT Conversion Table included in this subsection shall be used to convert scores for SAT exams taken prior to the 2011-2012 academic year.

(2) Pursuant to KRS 164.7874(3), the SAT to ACT Conversion Table included in this subsection shall be used to convert scores for SAT exams taken during or after the 2011-2012 academic year, but prior to March 2016. Only the scores from the critical reasoning and mathematics sections of the SAT within a single exam administration shall be considered for KEES supplemental awards.

(3) Pursuant to KRS 164.7874(3), the SAT and ACT Conversion Table included in this subsection shall be used to convert scores for SAT exams taken during or after the March 2016-2017 academic year, but prior to July 2018. Only the scores from the Evidence-Based Reading and Writing Sections (ERW+M) of the SAT within a single exam administration shall be considered for KEES supplemental awards.

(4) Pursuant to KRS 164.7874(3), the SAT and ACT Conversion Table included in this subsection shall be used to convert scores for SAT exams taken during or after July 2018. Only the scores from the Evidence-Based Reading and Writing Sections (ERW+M) of the SAT within a single exam administration shall be considered for KEES supplemental awards.

Section 8. Criteria for Supplemental Award to Noncertified, Nonpublic High School Students and to GED Students.

(1) A Kentucky resident who is a citizen, national, or permanent resident of the United States and who graduates from a nonpublic Kentucky high school not certified by the Kentucky Board of Education shall be eligible for a supplemental award if:

(a) The student is not a convicted felon;

(b) The date of the student's graduation is May 1999 or thereafter;

(d) The student enrolls in a participating institution within five (5) years after graduation from high school.

(2) A Kentucky resident who is a citizen, national, or permanent resident of the United States and who has not graduated from any Kentucky or out-of-state public or nonpublic high school shall be eligible for a supplemental award if:

(a) The student is not a convicted felon;

(b) The student's 18th birthday occurs on or after January 1, 1999;

Prior to being admitted to a participating institution; and
Within five (5) years after attaining eighteen (18) years of age;

(d) The student takes the ACT or SAT and achieves a minimum score for eligibility as established by KRS 164.7879(3); and

(e) The student enrolls in a participating institution after July 1, 1999, and within five (5) years of receiving the GED diploma.

(3) A student who graduates from or attends an accredited out-of-state high school or Department of Defense school shall qualify for a supplemental award if:

(a) The parents meet the provisions of KRS 164.7879(2)(c)1.a. and b.;

(b) The student takes the ACT or SAT and achieves a minimum score for eligibility as established by KRS 164.7879(3); and

(c) The student enrolls in a participating institution within five (5) years of graduating from or attending the accredited out-of-state high school or Department of Defense school.

(4) A student requesting a supplemental award under this section shall notify the participating institution where the student has or intends to enroll.

(5)

(a) Residency shall be determined by a participating institution in accordance with 13 KAR 2:045.

(b) A participating institution shall determine a student's eligibility for a supplemental award under this section and shall notify the authority of the student's eligibility.

Section 9. Supplemental Award. An eligible high school student who receives a supplemental award as a result of taking and receiving a GED within five (5) years of attaining eighteen (18) years of age shall have a maximum of five (5) years eligibility beyond the date the GED is received.

Section 10. Supplemental Award for Achievement on Examinations.

(1) Pursuant to KRS 164.7879(3)(c) and (d), a supplemental award shall be provided for achievement on AP, IB, or CAI examinations to an eligible high school student whose family was eligible for free and reduced price lunch during any year of high school.

(2)

(a) An eligible high school shall report the status of each student as eligible or ineligible for free and reduced price lunch to the authority on an annual basis.

(b) In determining a high school student's free and reduced price lunch eligibility, the high school shall utilize the income eligibility guidelines published each year by the United States Department of Agriculture, Food and Nutrition Service, available at www.fns.usda.gov/school-meals/income-eligibility-guidelines.

Section 11. Administrative Responsibilities and Expenses of Program.

(1) The authority annually shall determine the level of funding for expenses associated with the program and shall allocate funds from the Wallace G. Wilkinson Kentucky Educational Excellence Scholarship Trust Fund established by KRS 164.7877(1) and (3).

(2) The authority annually shall adopt a budget proposal indicating the amount of funds available and a detailed listing of the expenditures necessary to operate the program.

(3) The authority shall develop an allotment schedule for the release of the administrative funds.

Section 12. Incorporation by Reference.

(1) The following material is incorporated by reference:

(a) "Curriculum Certification", June 2005; and

(b) "Data Submission", June 2005.

History

RELATES TO: KRS 154A.130(4), 156.010, 158.007(8), 164.002(1), (2), 164.7871, 164.7884, 164.7885, 42 U.S.C. 1751 et seq.
STATUTORY AUTHORITY: KRS 164.7874(3), (16), 164.7877(3), 164.7879(1), (2), (3), 164.7881(4)(a), (c), (6)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.7877(3) requires the Kentucky Higher Education Assistance Authority to administer the Kentucky Educational Excellence Scholarship (KEES) trust fund. KRS 164.7874(16) requires the authority to promulgate administrative regulations establishing the KEES curriculum's courses of study. KRS 164.7879(3)(e) requires the authority to promulgate administrative regulations to determine the eligibility of a noncertified, nonpublic high school graduate and of a GED recipient for a supplemental award. KRS 164.7874(3) requires the authority to establish score equivalents between the SAT and ACT. KRS 164.7881(4)(a) requires the authority to establish overall award levels for the program. KRS 164.7879(2)(c) requires the authority to promulgate administrative regulations determining eligibility for children of parents who are in the military and who claim Kentucky as their home of record. KRS 164.7881(4)(c) requires the authority to promulgate administrative regulations identifying equivalent undergraduate programs of study. This administrative regulation establishes those requirements relating to the Kentucky Educational Excellence Scholarship (KEES) Program.
History: 25 Ky.R. 1479; 1903; 2122; eff. 3-1-1999; 27 Ky.R. 1321; 2422; eff. 3-19-2001; 28 Ky.R. 124; 552; eff. 9-5-2001; 29 Ky.R. 171; 744; 906; eff. 10-7-2002; 29 Ky.R. 2717; 30 Ky.R. 14; eff. 7-17-2003; Recodified from 13 KAR 2:090, 6-15-2005; 32 Ky.R. 456; eff. 10-7-2005; 35 Ky.R. 1840; 1999; eff. 4-3-2009; 38 Ky.R. 64; 476; eff. 10-7-2011; 40 Ky.R. 84; eff. 9-9-2013; 1313; eff. 3-7-2014; 41 Ky.R. 1125; 1501; eff. 2-6-2015; 41 Ky.R. 1125, 1501; eff. 7-6-2015; 42 Ky.R. 44; 1121; eff. 10-12-2015; 43 Ky.R. 73, 525; eff. 11-4-2016; 44 Ky.R. 107, 502; eff. 10-6-2017; 44 Ky.R. 1368, 1805; eff. 3-9-2018; Crt eff. 9-28-2018; 48 Ky.R. 2783; 49 Ky.R. 310; eff. 11-1-2022; 50 Ky.R. 2238; 51 Ky.R. 483; eff. 9-17-2024.

11 KAR 15:100 Comprehensive transition and postsecondary programs {#sec-11-kar-15-100 omnilex-key=us-ky-regs-official--title-11--11 KAR 15:100}

Section 1. Definitions.

(1) "Comprehensive transition and postsecondary program" is defined by KRS 164.740(3).

(2) "Eligible student" means an individual who meets the requirements set forth in KRS 164.7882(1).

Section 2. Enrollment Verification.

(1) The participating institution shall submit to the authority an enrollment verification file at the beginning of each academic term.

(2) For each eligible student, the enrollment verification file shall contain:

(a) The student's name and Social Security number;

(b) Certification of the student's enrollment in a comprehensive transition and postsecondary program; and

Section 3. Award.

(1) An eligible student shall receive a KEES award as established in KRS 164.7882(2).

(2) An eligible student who has earned a base KEES award, a supplemental award, or both shall be entitled to that award in addition to an award pursuant to this program.

Section 4. Disbursement. Funds for awards pursuant to this program shall be disbursed as established in 11 KAR 15:050, the administrative regulation pertaining to disbursement of funds for the Kentucky Educational Excellence (KEES) program.

Section 5. Refund and Repayment. Refunds and repayments pursuant to this program shall be completed as established in 11 KAR 15:060, the administrative regulation establishing the procedure for refunds and repayments under the Kentucky Educational Excellence (KEES) program.

Section 6. Grade Point Average Reporting.

(1) The participating institution shall electronically submit to the authority a file containing grade point average information not later than June 30 after the completion of the award period.

(2) For each eligible student, this file shall contain the student's:

(a) Name and Social Security number; and

(b) Cumulative grade point average.

Section 7. Award Renewals.

(1) In order to receive a subsequent award pursuant to this program, a student shall maintain enrollment in a comprehensive transition and postsecondary program at a participating institution located in Kentucky.

(2) A student who has earned either a base or supplemental KEES award shall satisfy the renewal requirements established in KRS 164.7881 in order to be eligible for a renewal award.

(3) Failure to maintain eligibility for a base or supplemental KEES award shall not impact the student's eligibility for a subsequent award pursuant to this program.

History

RELATES TO: KRS 164.740(3), 164.7871, 164.7874, 164.7877, 164.7882
STATUTORY AUTHORITY: KRS 164.7877(3), 164.7882
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.7877(3) requires the authority to administer the Kentucky Educational Excellence Scholarship (KEES) trust fund. KRS 164.7882(4) requires the authority to promulgate administrative regulations establishing the procedures for making KEES awards for students enrolled in comprehensive transition and postsecondary programs. This administrative regulation establishes those procedures relating to the Kentucky Educational Excellence Scholarship (KEES) Program.
History: 42 Ky.R. 627; 1124; eff. 10-12-2015; Crt eff. 9-28-2018; Crt eff. 2-28-2025.

11 KAR 15:110 Scholarships for Registered Apprenticeship and Qualified Workforce Training programs {#sec-11-kar-15-110 omnilex-key=us-ky-regs-official--title-11--11 KAR 15:110}

Section 1. Eligibility.

(1) A student who has earned a KEES award and who is enrolled in a registered apprenticeship program shall be eligible to request reimbursement for approved post-secondary expenses beginning with the 2018-2019 academic year.

(2) A student who has earned a KEES award and who is enrolled in a qualified workforce training program shall be eligible to request reimbursement for approved post-secondary expenses for the academic year beginning July 1, 2020.

(3) A student who has earned a KEES award and who is enrolled in an approved workforce solution training program shall be eligible to request reimbursement for approved post-secondary expenses for the academic year beginning July 1, 2023.

(4) A student who has earned a KEES award and who is enrolled in a qualified proprietary school program shall be eligible to request reimbursement for approved post-secondary expenses for the academic year beginning July 1, 2023.

(5) A student who has earned a KEES award and who is enrolled in an eligible college of art and design shall be eligible to request reimbursement for approved post-secondary expenses for the academic year beginning July 1, 2023.

(6) Reimbursement shall be made only for approved expenses as established in KRS 164.7884(3)(a).

Section 2. Election Process.

(1) By August 1 prior to the start of the academic year, a student enrolled in a registered apprenticeship, qualified workforce training program, approved workforce solutions training program, qualified proprietary school program, or eligible college of art and design shall submit to KHEAA their funding pathway choice, either traditional or reimbursement, for postsecondary KEES use.

(2) If a student chooses the traditional KEES funding pathway, funds shall be paid to the student's institution pursuant to KRS 164.7874 through 164.7883 and KRS 164.7885 upon KHEAA's receipt of enrollment verification from the institution. Funds shall not be paid directly to the student by KHEAA.

(3) If a student chooses the reimbursement pathway, funds for approved expenses shall be paid directly to the student upon KHEAA's receipt of both a reimbursement request and proof of purchase by the student.

(4) Any student who fails to make an election by August 1 shall automatically be placed in the traditional KEES funding pathway.

Section 3. Reimbursement Process.

(1) Upon receipt of a student's election to participate in the reimbursement pathway, KHEAA shall provide written confirmation to the student detailing the reimbursement process.

(2) To be eligible for reimbursement, the student shall:

(a) Purchase items required for participation in the registered apprenticeship, qualified workforce training program, approved workforce solutions training program, qualified proprietary school program, or eligible college of art and design;

(b) Complete and submit to KHEAA a KEES Expense Reimbursement Request; and

(3) Upon receipt of the required documentation and approval of the reimbursement request, KHEAA shall provide reimbursement of the approved expenses directly to the student in the form of a paper check.

(4) In addition to reimbursable purchases, a student may request a travel allowance of up to $250 per semester to cover commuting costs incurred during participation in the registered apprenticeship, qualified workforce training program, approved workforce solutions training program, qualified proprietary school program, or eligible college of art and design.

(5) The total reimbursement amount per year shall not exceed the student's KEES award maximum.

(6) Eligibility for reimbursement ends the earlier of:

(a) Five (5) years following the student's date of high school graduation or GED receipt;

(b) The student's successful completion of a registered apprenticeship, qualified workforce training program, approved workforce solutions training program, qualified proprietary school program, or eligible college of art and design program; or

Section 4. Conversion of Funding Pathway. A student may elect to change their funding pathway one (1) time after making their initial election.

(1) The completed KEES Reimbursement Pathway Selection Form shall be submitted to KHEAA.

(2) The change shall become effective at the beginning of the next academic year following KHEAA's receipt and approval of the request.

(3) The KEES award maximum for a student transitioning from the traditional KEES pathway to the reimbursement pathway shall be based on the student's postsecondary renewal amount for the last academic year completed in the traditional pathway.

Section 5. Incorporation by Reference.

(1) The following material is incorporated by reference:

(a) "KEES Expense Reimbursement Request", July 2024; and

(b) "KEES Reimbursement Pathway Selection Form", July 2024.

(2) This material may be inspected, copied or obtained, subject to applicable copywrite law, at the Kentucky Higher Education Assistance Authority, 100 Airport Road, Frankfort, Kentucky 40601, Monday through Friday, 8 a.m. to 4:30 p.m.

History

RELATES TO: KRS 164.7871 - 164.7885
STATUTORY AUTHORITY: KRS 164.744(2), 164.748(4), 164.753(3), 164.7884, 164.7894
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.7884(5) requires the authority to promulgate administrative regulations establishing the procedures for making awards to KEES-eligible students participating in a registered apprenticeship or qualified workforce training program. This administrative regulation establishes the procedures to award funds to KEES-eligible students participating in registered apprenticeships or qualified workforce training programs.
History: 45 Ky.R. 207, 627; eff. 10-5-2018; 50 Ky.R. 71, 1035; eff. 12-11-2023; 50 Ky.R. 2245; 51 Ky.R. 488; eff. 9-17-2024.

Chapter 16 Early Childhood Development Scholarship Program

11 KAR 16:001 Definitions for 11 KAR Chapter 16 {#sec-11-kar-16-001 omnilex-key=us-ky-regs-official--title-11--11 KAR 16:001}

Section 1. Definitions.

(1) "Academic term" means the fall, spring, or summer semester or its equivalence under a trimester or quarter system at a postsecondary education institution.

(2) "Authority" is defined in KRS 164.740(1).

(3) "Award year" means a period that begins July 1 of one (1) calendar year and ends June 30 of the next succeeding calendar year.

(4) "Capstone semester" means the culmination semester in an Interdisciplinary Early Childhood Education (IECE)/Early Childhood Program which:

(a) Requires additional hours of direct work with children; and

(b) May be listed as student teaching or a practicum.

(5) "Early childhood facility" means:

(a) A licensed Type I or a Type II child-care center defined in 922 KAR 2:110, Sections 1(14) and (15) that is located in Kentucky;

(b) A certified family child care home pursuant to KRS 199.8982 and 922 KAR 2:100 that is located in Kentucky;

(c) An organization approved by the Office of Inspector General of the Cabinet for Health and Family Services to offer training in early childhood development; or

(d) A developmentally appropriate preschool program defined in KRS 157.3175(2).

(6) "ECAC" means Early Childhood Advisory Council.

(7) "ECAC-approved early childhood development credential" means the Child Development Associate's credential or a postsecondary, undergraduate degree, certificate or diploma that is:

(a) An associate degree in early childhood education or baccalaureate or master degree in interdisciplinary early childhood education, or a related program that is approved by the Early Childhood Advisory Council; or

(b) The Kentucky Early Childhood Development Director's Certificate.

(8) "Eligible institution" is defined in KRS 164.740(4).

(9) "Participating early childhood facility" means an early childhood facility that agrees to provide monetary incentives pursuant to 11 KAR 16:060 to early childhood development scholarship recipients employed by the facility.

(10) "Participating educational institution" means an eligible institution located in Kentucky that:

(a) Actively participates in the federal Pell Grant Program;

(b) Offers a scholarship program curriculum;

(c) Has a contract in force with the authority relating to the administration of the Early Childhood Development Scholarship Program and other programs administered by the authority; and

(d)

Is publicly operated; or

a. Is licensed by the Commonwealth of Kentucky;

b. Has operated for at least ten (10) years;

c. Offers a program of study not comprised solely of sectarian instruction; and

d. Admits as regular students only:

(i) High school graduates;

(ii) Recipients of a general equivalency diploma; or

(iii) Students transferring from another accredited degree granting institution.

(11) "Preschool associate teacher" means a classified employee who:

(a) Is employed by a local school district in a paraprofessional role to organize, manage, and provide direct instruction to children below primary school age under the supervision of a qualified professional; and

(b) Meets the requirements of 704 KAR 3:420.

(12) "Professional development counselor" means an individual with the responsibilities to recruit candidates, process the applications, and follow as indicated the procedures established in 11 KAR Chapter 16.

(13) "Professional development funds" means state or federal training funds available through the Head Start Program, a public preschool program, or the Kentucky Early Intervention System (First Steps Program).

(14) "Scholarship" means an Early Childhood Development Scholarship.

(15) "Scholarship program curriculum" means an academic course or series of courses that is offered by a participating educational institution and needed to obtain an ECAC-approved early childhood development credential.

(16) "Teaching assistant" means an instructional aide in a public school preschool program as set forth in 704 KAR 3:410.

History

RELATES TO: KRS 164.518, 164.740
STATUTORY AUTHORITY: KRS 164.518(3), 164.748(4)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.518(3) requires the authority to promulgate administrative regulations for administration of the Early Childhood Development Scholarship Program. This administrative regulation establishes definitions applicable to 11 KAR Chapter 16.
History: 27 Ky.R. 1364; 1821; eff. 2-5-2001; 28 Ky.R. 663; 1109; eff. 11-5-2001; 31 Ky.R. 583; 926; eff. 11-8-2004; 32 Ky.R. 1311; 1605; eff. 3-31-2006; 34 Ky.R. 1771; 2079; eff. 4-4-2008; 40 Ky.R. 88; eff. 9-9-2013; TAm eff. 4-27-2016; Crt eff. 9-28-2018; 48 Ky.R. 1203; eff. 4-5-2022.

11 KAR 16:010 Early Childhood Development Scholarship Program applicant selection process {#sec-11-kar-16-010 omnilex-key=us-ky-regs-official--title-11--11 KAR 16:010}

Section 1. Eligibility of Applicants.

(1) Initial eligibility. To qualify for an Early Childhood Development Scholarship, an applicant shall:

(a) Be:

A citizen, national, or permanent resident of the United States;
A Kentucky resident as determined by the participating educational institution in accordance with criteria established in 13 KAR Chapter 2 by the Council on Postsecondary Education for the purposes of admission and tuition assessment;
A high school graduate or a General Educational Development (GED) recipient;
Unless the applicant is seeking scholarship renewal and has registered for a capstone semester:

a. Employed at least twenty (20) hours per week in a participating early childhood facility;

b. Employed to provide training at least twelve (12) times per year in early childhood development by a participating early childhood facility approved by the Office of Inspector General of the Cabinet for Health and Family Services to offer the training; or

c. Employed at least twenty (20) hours per week, providing direct instruction to children as a preschool associate teacher or as a teaching assistant in a public preschool program by a participating early childhood facility;

Enrolled in the scholarship program curriculum at a participating educational institution;
Pursuing an ECAC-approved:

a. Early childhood credential;

b. Associate degree;

c. Bachelor's degree; or

d. Master's degree.

Ineligible to receive professional development funds from another education program; and
Maintaining satisfactory academic progress as determined by the participating institution;

(b) Satisfy all financial obligations to the authority under any program administered by the authority pursuant to KRS 164.740 to 164.785, except that ineligibility for this reason may be waived by the executive director of the authority, at the recommendation of a designated staff review committee, for cause; and

In default on any loan under Title IV of the federal act, codified as 20 U.S.C. 1070 to 1099, unless eligibility has been reinstated;
Liable for any amounts that exceed annual or aggregate limits on any loan under Title IV of the federal act, codified as 20 U.S.C. 1070 to 1099; and
Liable for overpayment of any grant or loan under Title IV of the federal act, codified as 20 U.S.C. 1070 to 1099.

(2) Renewal eligibility. Persons seeking additional early childhood development scholarships shall:

(a) Meet the eligibility requirements of subsection (1) of this section; and

(b) Be making satisfactory academic progress toward the completion of the ECAC-approved early childhood credential as determined by the participating institution.

(3) Appeal of determination.

(a) A student denied a scholarship for a reason other than lack of funds may appeal the determination by the ECAC.

(b) A student shall submit a written statement of appeal to the ECAC within fifteen (15) calendar days after the date of notification of denial.

A hearing officer or committee appointed by ECAC shall consider the student's appeal and make a decision on the issues involved; and
The student's due process rights, including the right to present information in support of his claim of eligibility and the right to be represented by legal counsel, are protected.

(4) Commitment of service. A scholarship applicant shall commit that he or she shall subsequently render service:

(a) For six (6) months at a participating early childhood facility upon obtaining the child development associate certificate, paid for in part by a scholarship;

(b) For one (1) year at a participating early childhood facility upon obtaining the early childhood credential of an associate degree or the Kentucky Early Childhood Development Director's Certificate, paid for in part by a scholarship; or

(c) For six (6) months at a participating early childhood facility and one (1) additional year at an early childhood facility located in Kentucky upon obtaining the early childhood credential of a baccalaureate degree, paid for in part by a scholarship.

Section 2. Application.

(1) Prior to the beginning of each academic term, a person seeking an early childhood development scholarship shall obtain an Early Childhood Development Scholarship Application set forth in 11 KAR 4:080, Section 1(4)(b), from the KHEAA Web site, http//www.kheaa.com/prog_ecds.html. The applicant shall complete the online application.

(2) The applicant shall:

(a) Print the employer verification page from the completed application;

(b) Have this page certified by an authorized representative of the participating early childhood facility; and

July 15, or the next regular business day if July 15 falls on a weekend or holiday, preceding the fall academic term for which the scholarship is requested;
November 15, or the next regular business day if November 15 falls on a weekend or holiday, preceding the spring academic term for which the scholarship is requested; or
April 15, or the next regular business day if April 15 falls on a weekend or holiday, preceding the summer academic term for which the scholarship is requested.

(3) The applicant shall also complete and submit to the United States Department of Education the Free Application for Federal Student Aid ("FAFSA") set forth in 11 KAR 4:080, Section 1(4)(a). This application shall be completed either in paper format or electronically via the Internet.

Section 3. Selection Process.

(1) The professional development counselor shall verify the application information and determine the eligibility of the applicant.

(2) The professional development counselor shall recommend scholarship awards for eligible applicants in the following order until funds are depleted:

(a) First, scholarships shall be awarded to eligible renewal applicants, ranked in order of the date and time the application is submitted.

(b) Next, scholarships shall be awarded to eligible new applicants, ranked in order of the date and time the application is received by the professional development counselor.

(3) The professional development counselor shall forward to the ECAC the applications of those persons recommended to receive a scholarship and ensure that the applications are received by the ECAC no later than:

(a) July 22, or the next regular business day if July 22 falls on a weekend or holiday, preceding the fall academic term for which the scholarship is requested;

(b) November 22, or the next regular business day if November 22 falls on a weekend or holiday, preceding the spring academic term for which the scholarship is requested; or

(c) April 22, or the next regular business day if April 22 falls on a weekend or holiday, preceding the summer academic term for which the scholarship is requested.

(4) The employer signature page shall be received by the ECAC no later than August 1, December 1, and May 1 of the appropriate semester.

(5) ECAC shall certify the eligibility determination of approved applicants.

Section 4.

(1) Award amount. The scholarship amount awarded to an eligible applicant for an academic term shall be the amount of tuition actually charged for the academic term by the participating educational institution that the scholarship recipient will be attending based on the recipient's enrollment status, but shall not exceed the maximum award amount.

(2) Award maximum. The maximum scholarship amount awarded to an eligible applicant for an award year shall be up to the tuition and mandatory fees at the participating institution in which the recipient is enrolled for the number of hours enrolled not to exceed the undergraduate tuition and mandatory fees at the highest priced in-state public participating institution. .

History

RELATES TO: KRS 164.518
STATUTORY AUTHORITY: KRS 164.518(3), 164.748(4)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.518(3) requires the authority to promulgate administrative regulations for administration of the Early Childhood Development Scholarship Program. This administrative regulation establishes the applicant selection process for the Early Childhood Development Scholarship Program.
History: 27 Ky.R. 1365; 1822; 2110; eff. 2-5-2001; 3318; 28 Ky.R. 414; 551; eff. 9-5-2001; 30 Ky.R. 1578; 2010; eff. 3-18-2004; 32 Ky.R. 1312; 1606; eff. 3-31-2006; 33 Ky.R. 185; 715; eff. 10-6-2006; 3232; 3592; eff. 7-6-2007; 34 Ky.R. 1773; 2079; eff. 4-4-2008; 40 Ky.R. 90; eff. 9-9-2013; Crt eff. 9-28-2018; 48 Ky.R. 1205; eff. 4-5-2022.

11 KAR 16:020 Early Childhood Development Scholarship Program disbursement process {#sec-11-kar-16-020 omnilex-key=us-ky-regs-official--title-11--11 KAR 16:020}

Section 1. Eligibility Verification. Once the census date for each academic term has passed, the institution shall verify the eligibility of each student and submit to the authority a complete and accurate eligibility verification record that shall include:

(1) The student's enrollment status; and

(2) The number of credit hours in which the student is enrolled for the academic term.

Section 2. Disbursement and Delivery of Funds.

(1) Within thirty (30) days following receipt by the authority of the eligibility verification data, the authority shall disburse Early Childhood Development Scholarship funds to the participating institution for subsequent delivery to the eligible scholarship recipient.

(2) Scholarship proceeds shall be used by the recipient only for payment of tuition and mandatory fees to the participating educational institution.

(3) The participating institution shall:

(a) Return to the authority scholarship funds that exceed the amount of tuition and mandatory fees charged by the institution to the scholarship recipient for the academic term based upon the recipient's enrollment status at the time of eligibility verification;

(b) Be responsible for proper disbursement of scholarship funds to each eligible student during the academic term for which each award is intended;

(c) Be liable for disbursement to the wrong individual or to an ineligible student, or for untimely disbursement pursuant to this section; and

(d) Make restitution to the authority of any amount improperly delivered.

(4) Failure of the participating institution to make restitution as required shall, without precluding other remedies, be deemed cause for limitation, suspension, or termination of the participation of the institution in accordance with 11 KAR 4:020.

History

RELATES TO: KRS 164.518
STATUTORY AUTHORITY: KRS 164.518(3), 164.748(4)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.518(3) requires the authority to promulgate administrative regulations for administration of the Early Childhood Development Scholarship Program. This administrative regulation establishes procedures for disbursement of the monies awarded under the Early Childhood Development Scholarship Program.
History: 27 Ky.R. 1367; 1824; eff. 2-5-2001; Cert eff. 9-28-2018; 48 Ky.R. 2788; 49 Ky.R. 314; eff. 11-1-2022.

11 KAR 16:030 Early Childhood Development Scholarship Program overawards and refunds {#sec-11-kar-16-030 omnilex-key=us-ky-regs-official--title-11--11 KAR 16:030}

Section 1. Failure to Enroll or Official Withdrawal Before Classes Begin. If a scholarship recipient fails to enroll in or officially withdraws from the scholarship program curriculum at a participating educational institution prior to the first day of classes, the scholarship award shall be deemed an overaward and a full refund of the monies to the authority shall be required, notwithstanding a policy of the school to the contrary.

Section 2. Withdrawal After Classes Begin.

(1) If a scholarship recipient officially withdraws or reduces his enrollment, and this occurs before the participating institution applies the funds to the student's account or disburses the funds to the student, the participating institution shall:

(a) Apply the funds to the student's account for charges owed to the institution in accordance with the participating institution's refund and repayment policy relative to financial aid funds; and

(b) Return to the authority the remaining funds.

(2) If the participating institution applies the funds awarded to the student's account or disburses the funds to the student, and the scholarship recipient subsequently officially withdraws or reduces enrollment status, the student shall not owe a repayment to the authority of award funds for that academic term. If the participating institution owes a refund of institutional charges in accordance with the participating institution's refund and repayment policy relative to financial aid funds, the institution shall remit to the authority that part of the refund attributable to the early childhood development scholarship funds.

Section 3. Unofficial Withdrawal. If a scholarship recipient unofficially withdraws from an eligible course after the beginning of classes, the authority shall not seek from the participating institution a refund of the monies paid under the scholarship.

Section 4.

(1) If the participating institution applies to an ineligible student's account or disburses to an ineligible student scholarship funds for an academic term, the participating institution and the student shall be jointly and severally liable to repay to the authority the entire amount of scholarship funds applied to that student's account and disbursed to that student.

(2) If the participating institution applies to an eligible scholarship recipient's account or disburses to an eligible scholarship recipient scholarship funds for an academic term that exceed the amount awarded to the scholarship recipient, the participating institution and the scholarship recipient shall be jointly and severally liable to repay to the authority the excess amount of scholarship funds applied to that scholarship recipient's account and disbursed to that scholarship recipient.

Section 5.

(1) If a refund is due from the participating institution or a repayment is due from a student who receives an overpayment or was not eligible for a scholarship award, the participating institution shall transmit to the authority the refund and shall report to the authority:

(a) The student's name and Social Security number;

(b) The reason for the refund or repayment;

(d) The academic term and year; and

(e) The calculation used for determining the refund or repayment.

(2) Refund of an amount due by the participating institution shall be transmitted to the authority by electronic funds transfer. Failure of the institution to make restitution when required shall, without precluding other remedies, be deemed cause for limitation, suspension or termination of the participation of the institution in accordance with 11 KAR 4:020.

History

RELATES TO: KRS 164.518
STATUTORY AUTHORITY: KRS 164.518(3), 164.748(4)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.518(3) requires the authority to promulgate administrative regulations for administration of the Early Childhood Development Scholarship Program. This administrative regulation establishes procedures for refund to the authority of monies paid under the Early Childhood Development Scholarship Program.
History: 27 Ky.R. 1369; 2111; eff. 2-5-2001; Crt eff. 9-28-2018; Crt eff. 3-3-2025.

11 KAR 16:040 Early Childhood Development Scholarship Program recordkeeping requirements {#sec-11-kar-16-040 omnilex-key=us-ky-regs-official--title-11--11 KAR 16:040}

Section 1. Record Maintenance.

(1) The participating early childhood facility shall:

(a) Maintain complete and accurate records pertaining to the scholarship recipient's eligibility for the scholarship and monetary incentives established by the recipient's employment and records pertaining to the payment of monetary incentives by the participating early childhood facility; and

(b) Retain the records for three (3) years following the year in which the scholarship recipient applied for the scholarship.

(2) The participating educational institution shall:

(a) Maintain complete and accurate records pertaining to the eligibility, enrollment, and progress of students receiving aid under this program and the disbursement of funds and institutional charges as may be necessary to audit the disposition of these funds; and

(b) Retain the records for three (3) years following the year in which the student ceases to be enrolled at the educational institution.

(3) The professional development counselor shall:

(a) Maintain complete and accurate records pertaining to the scholarship recipient's eligibility for the scholarship and monetary incentives, including:

A copy of the scholarship recipient's signed applications for the scholarship;
Documents establishing eligibility for monetary incentives pursuant to 11 KAR 16:060; and
Record of disbursements of monetary incentives; and

(b) Retain the records for three (3) years following the year in which the scholarship recipient applied for the scholarship.

(4) ECAC shall forward to the authority not less frequently than once per year the original applications of all scholarship recipients to be retained by the authority for audit purposes.

(5) All documentation and correspondence relating to the cancellation, disbursement, and refund of scholarships shall be retained by the authority for a period of three (3) years following the year in which the scholarship was disbursed.

Section 2. Records retained pursuant to this administrative regulation shall be retained in any format used by the organization retaining the records for storage of its records in the normal course of business.

History

RELATES TO: KRS 164.518(3)
STATUTORY AUTHORITY: KRS 164.518(3), 164.748(4)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.518(3) requires the authority to promulgate administrative regulations for administration of the Early Childhood Development Scholarship Program. This administrative regulation establishes requirements for maintaining records under the Early Childhood Development Scholarship Program.
History: 27 Ky.R. 1371; 2111; eff. 2-5-2001; 40 Ky.R. 92; eff. 9-9-2013; Crt eff. 9-28-2018; Crt eff. 3-3-2025.

11 KAR 16:050 Early Childhood Development Scholarship Program costs {#sec-11-kar-16-050 omnilex-key=us-ky-regs-official--title-11--11 KAR 16:050}

Section 1.

(1) The ECAC shall prepare and transmit to the authority by March 1 each year a written projection of the anticipated number and amount of scholarship awards and monetary incentive awards for the following academic year.

(2) The written projection shall reflect the agreement between ECAC and the authority concerning the amount of funds available for the Early Childhood Development Scholarship Program that the authority may expend for costs incurred by the authority related to administration of the program.

History

RELATES TO: KRS 164.518
STATUTORY AUTHORITY: KRS 164.518(3), 164.748(4)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.518(3) requires the authority to promulgate administrative regulations for administration of the Early Childhood Development Scholarship Program. This administrative regulation establishes the mechanism for payment of costs related to the implementation of the Early Childhood Development Scholarship Program.
History: 27 Ky.R. 1372; 2112; eff. 2-5-2001; 40 Ky.R. 94; eff. 9-9-2013; Crt eff. 9-28-2018; Crt eff. 3-3-2025.

11 KAR 16:060 Early Childhood Development Scholarship Program system of monetary incentives {#sec-11-kar-16-060 omnilex-key=us-ky-regs-official--title-11--11 KAR 16:060}

Section 1. Textbook Expense Incentive. A scholarship recipient shall be entitled to a monetary allowance from his employer for the purchase of textbooks in an amount equal to the actual cost of the textbooks not to exceed fifty (50) dollars per academic term and $150 per academic year. This allowance shall be provided through reimbursement to the scholarship recipient by the employer, direct payment by the employer to the textbook vendor, or other means as agreed upon by the employer and scholarship recipient.

(1) Reimbursement.

(a) The scholarship recipient shall present to his employer at the participating early childhood facility a receipt for the purchase of textbooks for the scholarship program curriculum. The scholarship recipient shall present the receipt to his employer no later than the end of the academic term to be eligible to receive a textbook expense reimbursement for the academic term.

(b) The participating early childhood facility shall, no later than fifteen (15) days after presentation of a receipt for textbook purchase, reimburse the scholarship recipient for the actual cost of the textbooks up to the maximum established in this section.

(c) The participating early childhood facility shall, upon request by the professional development counselor, provide evidence of reimbursement of scholarship recipients for textbooks.

(2) Direct payment.

(a) The participating early childhood facility shall enter into an arrangement with the textbook vendor whereby the employer authorizes the scholarship recipient to obtain the approved or necessary textbooks, and, upon receipt of a billing statement from the vendor, make a payment to the vendor of the actual cost of the textbooks up to the maximum established in this section.

(b) The participating early childhood facility shall, upon request by the professional development counselor, provide evidence of direct payment of the textbook incentive to the vendor on behalf of a scholarship recipient.

(3) Other funding means. If the participating early childhood facility and the scholarship recipient mutually agree to another method for payment of the textbook expense incentive, the participating early childhood facility shall maintain documentation to evidence payment of the incentive and, upon request by the professional development counselor, provide proof to substantiate the payment.

Section 2. Related Educational Expense Reimbursement.

(1) Subject to the availability of funds, a scholarship recipient who meets the requirements set forth in this section shall be eligible for reimbursement of related educational expenses as established in subsection (3) of this section.

(2) The scholarship recipient shall present to the professional development counselor no later than sixty (60) days following completion of the academic term an official grade report from the participating educational institution as evidence of completion of the scholarship program curriculum with a grade of at least "C" or its equivalent in each course in which the scholarship recipient is enrolled for credit during the academic term.

(3) The amount of the related educational expense reimbursement shall be:

(a) Fifty (50) dollars to a scholarship recipient pursuing a child development associate's credential at a participating educational institution; or

(b) $100 to a scholarship recipient pursuing an ECAC-approved early childhood development credential, pursuing other than a child development associate's, or an ECAC-approved associate or bachelor's degree credential.

(4) The professional development counselor, no later than thirty (30) days after considering if the scholarship recipient is eligible to receive reimbursement of related educational expenses associated with attendance at the participating educational institution, shall notify the scholarship recipient in writing of the determination of eligibility for the reimbursement of related educational expenses and the amount of the award. Eligibility shall be determined based on the requirements of this administrative regulation.

(5)

(a) After determination of eligibility, the professional development counselor shall transmit to the Department for Community Based Services of the Cabinet for Health and Family Services a list of eligible recipients of reimbursement of related educational expenses. The list shall indicate:

The name, home address, and Social Security number of the award recipient; and
The amount of the reimbursement of related educational expenses earned by the recipient.

(b) The Cabinet for Health and Family Service shall remit to the award recipient the earned reimbursement of related educational expenses established in subsection (3) of this section.

Section 3. Milestone Achievement Award.

(1) The scholarship recipient shall present to the professional development counselor and to the participating early childhood facility no later than sixty (60) days following completion of the academic term evidence of earning the ECAC-approved early childhood development credential or degree to be eligible to receive a milestone achievement award. Milestone achievement award reimbursement shall be provided only to the extent funds are available.

(2) Evidence of earning the ECAC-approved early childhood development credential or associate or bachelor's degree shall be:

(a) The certificate for the Commonwealth Child Care Credential, the Child Development Associate Credential, or the Kentucky Early Childhood Development Director's Credential; or

(b) The diploma or official transcript from the participating educational institution for an ECAC-approved early childhood associate or bachelor's degree.

(3) The milestone achievement award amount shall be:

(a) $100 for earning the Commonwealth Child Care Credential in an early childhood development program approved by the ECAC;

(b) $250 for earning an initial child development associate's credential;

(c) $300 for earning an initial associate degree in early childhood education or other program approved by the ECAC, or the Kentucky Early Childhood Development Director's Credential; or

(d) $500 for earning an initial baccalaureate degree in interdisciplinary early childhood education or other program approved by the ECAC.

(4) The professional development counselor, no later than thirty (30) days after considering if the scholarship recipient is eligible to receive a milestone achievement award, shall notify the scholarship recipient in writing of the determination of eligibility for the milestone achievement award and the amount of the award. Eligibility shall be determined based on the requirements of this administrative regulation.

(5)

(a) No later than fifteen (15) days following receipt of the document established in subsection (2) of this section, the participating early childhood facility that employs the scholarship recipient, upon the scholarship recipient earning the ECAC-approved early childhood credential or degree, shall remit to the scholarship recipient by check a minimum of ten (10) percent of the earned milestone achievement award established in subsection (3) of this section.

(b) The participating early childhood facility shall send to the professional development counselor a copy of the check as evidence that the participating early childhood facility has paid the scholarship recipient in accordance with paragraph (a) of this subsection.

(6)

(a) After determination of eligibility and evidence of payment by the participating early childhood facility of the milestone achievement award, the professional development counselor shall transmit to the Department for Community Based Services of the Cabinet for Health and Family Services a list of eligible recipients of the milestone achievement award. The list shall indicate:

The name, home address, and Social Security number of the award recipient; and
The amount of the milestone achievement award earned by the recipient.

(b) The Cabinet for Health and Family Services shall remit to the award recipient ninety (90) percent of the earned milestone achievement award specified in subsection (3) of this section.

(7) A participating early childhood facility may appeal to the Early Childhood Development Authority Advisory Council for an exception to the foregoing provisions regarding the type of credentials for which the facility funds the Milestone Achievement Award or the timing of the payment of the award based upon the needs and organizational goals of the facility, the professional learning objectives of the scholar, or any fiscal limitations to which the facility may be subject.

History

RELATES TO: KRS 164.518, 199.8941(4)
STATUTORY AUTHORITY: KRS 164.518(3), 164.748(4)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.518(3) requires the authority to promulgate administrative regulations for administration of the Early Childhood Development Scholarship Program. This administrative regulation establishes responsibility for administration of the system of monetary incentives offered to Early Childhood Development Scholarship recipients.
History: 27 Ky.R. 1373; 1826; eff. 2-5-2001; 28 Ky.R. 664; eff. 11-5-2001; 34 Ky.R. 1775; 2081; eff. 4-4-2008; 40 Ky.R. 95; eff. 9-9-2013; 42 Ky.R. 449; 1125; eff. 10-12-2015; Crt eff. 9-28-2018; Crt eff. 3-3-2025.

11 KAR 16:070 Dual enrollment under consortium agreement {#sec-11-kar-16-070 omnilex-key=us-ky-regs-official--title-11--11 KAR 16:070}

Section 1. For purposes of the Early Childhood Development Scholarship program, a student, who is otherwise eligible pursuant to KRS 164.518 and is enrolled simultaneously at two (2) or more participating institutions pursuing a program of study jointly offered by those institutions, shall be eligible under this section if:

(1) The eligible program of study is covered by a consortium agreement between the participating institutions; and

(2) The eligible postsecondary student is carrying a combined academic workload at all participating institutions in the consortium equal to no more than nine (9) credit hours, except as provided in 11 KAR 16:010, Section 1(1)(a).

Section 2. Consortium Agreement. Two (2) or more participating institutions in the Early Childhood Development Scholarship program shall, for purposes of Section 1 of this administrative regulation, execute a consortium agreement which meets at least the following terms and conditions:

(1) The agreement shall be written and signed by authorized representatives of each participating institution;

(2) The agreement shall designate which participating institution will serve as the "primary" institution; and

(3) The agreement shall specify that the primary institution shall perform the duties set forth in Section 3 of this administrative regulation.

Section 3. Duties of Primary Institution. The primary institution designated in a consortium agreement shall assume the following duties and responsibilities:

(1) Maintain all records, including information from all participating institutions about the eligible postsecondary student's grades, institutional costs incurred, financial aid received, enrollment, and all other information related to the student's eligibility as is required to be maintained on any other Early Childhood Development Scholarship recipient enrolled in the primary institution;

(2) Disburse the Early Childhood Development Scholarship to the eligible postsecondary student;

(5) Calculate any refund or repayment and make an applicable refund based on the primary institution's refund policy, as provided in 11 KAR 16:030 based upon a change in enrollment at a participating institution in the consortium, as if the student were enrolled at the primary institution; and

(6) Provide to the authority, on behalf of all participating institutions in the consortium, all required reports and notifications as if the student were enrolled only at the primary institution.

Section 4. The consortium agreement may contain other terms and conditions, not inconsistent with this administrative regulation, as may be deemed necessary or appropriate by the participating institutions.

History

RELATES TO: KRS 164.518
STATUTORY AUTHORITY: KRS 164.518(3), 164.748(4)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.518(3) requires the authority to promulgate administrative regulations for administration of the Early Childhood Development Scholarship Program. This administrative regulation establishes the conditions for Early Childhood Development Scholarship eligibility for a student simultaneously enrolled in two (2) or more participating institutions.
History: 33 Ky.R. 3304; 3593; eff. 7-6-2007; Crt eff. 9-28-2018; Crt eff. 3-3-2025.

Chapter 17 Kentucky Affordable Prepaid Tuition Plan (KAPT)

11 KAR 17:010 Definitions for 11 KAR Chapter 17 {#sec-11-kar-17-010 omnilex-key=us-ky-regs-official--title-11--11 KAR 17:010}

Section 1. Definitions.

(1) "Application period" means the period during which applications for a prepaid tuition contract shall be received by the office.

(2) "Board" means the Board of Directors of the Commonwealth Postsecondary Education Prepaid Tuition Trust Fund.

(3) "Eligible educational institution" is defined by KRS 164A.700(3).

(4) "Full-time enrollment" means, for purposes of determining the payout value of a prepaid tuition account, sixteen (16) semester hours or the equivalent under a trimester or quarter system at an eligible educational institution.

(5) "Fund" is defined by KRS 164A.700(4).

(6) "KAPT" or "Kentucky's Affordable Prepaid Tuition Plan" means the name by which the Commonwealth Postsecondary Education Prepaid Tuition Trust Fund shall be marketed and promoted, in accordance with KRS 164A.700(4) and 164A.704(9).

(7) "Mandatory fees" means, for purposes of determining the value of a prepaid tuition account, fees required as a condition of enrollment incurred by all students at an eligible educational institution.

(8) "Office" means the Tuition Account Program Office in the Kentucky Higher Education Assistance Authority that is responsible for administering the prepaid tuition accounts.

(9) "Prepaid tuition" is defined by KRS 164A.700(6).

(10) "Prepaid tuition account" is defined by KRS 164A.700(9).

(11) "Prepaid tuition contract" is defined by KRS 164A.700(10).

(12) "Projected enrollment date" means the estimated date that the qualified beneficiary shall be enrolled and attend an eligible educational institution.

(13) "Purchaser" is defined by KRS 164A.700(13).

(14) "Qualified beneficiary" is defined by KRS 164A.700(14).

(15) "Qualified postsecondary education expenses" is defined by KRS 164A.700(16).

(16) "Tuition" is defined by KRS 164A.700(15).

(17) "Value of a prepaid tuition account" is defined by KRS 164A.700(18).

History

RELATES TO: KRS 164A.700-164A.709
STATUTORY AUTHORITY: KRS 164A.704(1)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164A.704(1) requires the board to promulgate administrative regulations to implement KRS 164A.700 to 164A.709. This administrative regulation establishes the definitions for 11 KAR Chapter 17.
History: 30 Ky.R. 757; 1193; eff. 12-1-2003; 31 Ky.R. 377; 698; eff. 11-5-2004; Cert eff. 9-28-2018; Cert eff. 10-1-2024.

11 KAR 17:040 Applying for a prepaid tuition contract {#sec-11-kar-17-040 omnilex-key=us-ky-regs-official--title-11--11 KAR 17:040}

Section 1. Application.

(1) A purchaser desiring to enter into a prepaid tuition contract shall submit a completed "Application for Enrollment" with the application fee required by 11 KAR 17:100 to the office during the application period. Only one (1) purchaser per prepaid tuition contract shall be allowed.

(2) After acceptance of the application and application fee by the office, the purchaser shall receive a prepaid tuition contract terms and conditions of payment and purchase.

(3)

(a) The application shall become part of the prepaid tuition contract which shall be comprised of:

The application;
The prepaid tuition contract terms and conditions of payment and purchase; and
The master agreement.

(b) The prepaid tuition contract shall become valid upon receipt by the office of:

The first installment payment due under the payment schedule; or
The one (1) time lump sum payment representing the full purchase price of the prepaid tuition contract.

The specific amount and number of payments required under the tuition plan elected by the purchaser;
The specific terms under which the purchaser shall make payments to the fund, including the dates upon which each payment is due;
Consequences of payment default by the purchaser;
The name and enrollment date of the beneficiary, except in the case of a gift as described in KRS 164A.707(6) and 164A.704(10);
The terms under which an amendment to a prepaid tuition contract may be made;
The specific tuition plan selected by the purchaser;
The terms under which the office is obligated to pay tuition from the fund under a prepaid tuition contract; and
Any other term deemed appropriate by the board.

Section 2. Proof of Residency and Statement of Intent. In submitting an application, the purchaser shall demonstrate that the beneficiary of the prepaid tuition contract is a qualified beneficiary. The purchaser shall submit the following to the office to establish that the beneficiary is a qualified beneficiary:

(1) If the beneficiary is a Kentucky resident, a signed and sworn statement from the purchaser certifying that the beneficiary is a Kentucky resident; or

(2) If the beneficiary is not a Kentucky resident, a signed and sworn statement from the purchaser that states that at the time of purchase of the prepaid tuition contract, the beneficiary intends to attend an eligible educational institution in Kentucky.

Section 3. Incorporation by Reference.

(1) "Application for Enrollment", August 2004, is incorporated by reference.

History

RELATES TO: KRS 164A.700, 164A.705, 164A.707, 164A.709
STATUTORY AUTHORITY: KRS 164A.704(1), (6)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164A.704(1) requires the board to promulgate administrative regulations to implement KRS 164A.700 to 164A.709. KRS 164A.704(6) provides that the board shall develop requirements, procedures, and guidelines regarding prepaid tuition contracts. This administrative regulation establishes the procedure for applying for a prepaid tuition contract.
History: 30 Ky.R. 758; 1194; eff. 12-1-2003; 31 Ky.R. 784; eff. 1-4-2005; Cert eff. 9-28-2018; Cert eff. 10-1-2024.

11 KAR 17:050 Prepaid tuition contract prices, payments, and default {#sec-11-kar-17-050 omnilex-key=us-ky-regs-official--title-11--11 KAR 17:050}

Section 1. Prepaid Tuition Contract Prices.

(1) The board shall determine all tuition plans available for the purchase of prepaid tuition under a prepaid tuition contract.

(2) The prices for all tuition plans available for the purchase under a prepaid tuition contract shall be determined for each application period by the board.

(3) The purchase price determined by the board shall be expressed in installments in accordance with the payment schedule set by the office or in a lump sum, one (1) time payment representing the full purchase price of the prepaid tuition contract.

Section 2. Prepaid Tuition Contract Payments.

(1) All payments due under a prepaid tuition contract shall be paid in cash in one (1) of the following forms:

(a) Automatic clearinghouse checks;

(b) Payroll deduction, if the payroll deduction plan has been approved by the office;

(d) Credit card approved by the office;

(e) Personal check; or

(f) Electronic internet debit.

(2) A purchaser may request a change in the payment schedule by written request to the office. The request shall be accompanied by a change in payment schedule fee as required by 11 KAR 17:100. The request shall be subject to approval by the office based on the type of plan selected and its corresponding payment schedule.

(3) A purchaser may prepay any remaining payments due under his payment schedule at any time without penalty.

(4) A purchaser shall receive an annual statement showing a record of payments to the fund, the amount still due from the purchaser under the payment schedule, and any amounts paid by the fund under the prepaid tuition contract.

(5) Subject to proper payment in accordance with subsection (1) of this section, a purchaser may purchase a prepaid tuition contract with funds representing custodial property under the Kentucky Uniform Transfer to Minors Act, KRS 385.012 to 385.252, or another equivalent uniform transfer of gifts to minors act of another state.

Section 3. Default.

(1) Failure to make timely payments in accordance with the payment schedule shall constitute default by the purchaser and assessment of a late payment fee as required by 11 KAR 17:100. A purchaser shall be notified in writing of the default and the assessment of the late payment fee.

(2) If the payment of the late payment fee and all delinquent amounts due under the payment schedule is not received by the office by the date set in the notice of default, the office shall accordingly reduce the value of the prepaid tuition account.

(3) If a prepaid tuition contract continues in default for more than 210 days, the board shall terminate the prepaid tuition contract and refund the contributions, subject to 11 KAR 17:090, Section 1(3) and (4).

History

RELATES TO: KRS 164A.704, 164A.705, 164A.707
STATUTORY AUTHORITY: KRS 164A.704(1), (6), 2003 Ky. Acts ch. 156, Part IX, Sec. 46, EO 2003-652
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164A.704(1) requires the board to promulgate administrative regulations to implement KRS 164A.700 to 164A.709. KRS 164A.704(6) provides that the board shall develop requirements, procedures, and guidelines regarding prepaid tuition contracts. 2003 Ky. Acts ch. 156, Part IX, Section 46, and EO 2003-652 transferred the governance and administration of the Prepaid Tuition Program from the Department of Treasury to the Kentucky Higher Education Assistance Authority. This administrative regulation establishes the requirements for prepaid tuition contract prices, payments, and default.
History: 30 Ky.R. 759; 1194; eff. 12-1-2003; Cert eff. 9-28-2018; Cert eff. 10-1-2024.

11 KAR 17:060 Amendment of a prepaid tuition contract {#sec-11-kar-17-060 omnilex-key=us-ky-regs-official--title-11--11 KAR 17:060}

Section 1. Amendments in General. Any purchaser desiring to make an amendment to a prepaid tuition contract as authorized in KRS 164A.707(2) shall submit a written request accompanied by the applicable administrative fee established in 11 KAR 17:100 to the office and comply with all other applicable procedures relating to the amendment. A requested amendment shall be subject to, and become effective upon, approval by the office.

Section 2. Change in Beneficiary.

(1) In accordance with KRS 164A.707(2)(a), a purchaser may amend a prepaid tuition contract to change the qualified beneficiary at any time.

(2) In submitting a written request to change the qualified beneficiary, the purchaser shall include proof of Kentucky residency or a statement of intent for the new beneficiary as required under 11 KAR 17:040, Section 2, and sufficient documentation evidencing the relationship between the new and current beneficiary of the prepaid tuition contract.

(3) If amendment to a prepaid tuition contract changes the projected enrollment date of a qualified beneficiary, the purchaser shall pay the additional amount necessary to properly fund the amended prepaid tuition contract, as determined by the office. The office shall notify the purchaser of any additional amounts due and owing under the amended prepaid tuition contract.

Section 3. Change in Purchaser. A request for a change in purchaser shall comply with the requirements established in this section, 26 U.S.C. 529 and regulations thereunder.

(1) A purchaser may assign ownership of the prepaid tuition contract to a successor purchaser upon acceptance of the office. The assignment shall only be effective if the assignment:

(a) Is to a purchaser as defined in KRS 164A.700(13);

(b) Is irrevocable;

(c) Fully and completely assigns all ownership rights, title and interest including, without limitation, reversionary rights and powers of appointment (i.e., power to substitute beneficiaries) and the right to direct the distribution of benefits; and

(d) Is in writing with notarized signature of the purchaser and is accepted by the office.

(2) Upon the death, disability, or marital dissolution of a purchaser, an assignment of ownership, and all rights and obligations of a prepaid tuition contract, shall be made in accordance with this section.

(3) Sufficient documentation of the purchaser's death, disability, or dissolution of marriage shall be submitted to the office, and the successor-in-interest shall accept the status as successor-in-interest by notarized signature.

(4) A purchaser shall have the right to designate a successor-in-interest to retain all rights and interest in his prepaid tuition contract upon his death. Upon the death of a purchaser, all rights and obligations of the purchaser under a prepaid tuition contract shall be assigned to the named individual or entity as stated in the purchaser's written designation accepted by the office. Absent written designation accepted by the office, the purchaser's prepaid tuition contract shall be assigned to the purchaser's surviving spouse.

(5) Upon disability of a purchaser, all rights and obligations of the purchaser under a prepaid tuition contract shall be assigned to the named individual or entity as stated in the purchaser's written designation accepted by the office. Absent written designation, the purchaser's duly appointed attorney-in-fact or court ordered legal guardian or conservator, if applicable, shall become the purchaser's successor-in-interest. Sufficient documentation evidencing the purchaser's attorney-in-fact or legal appointment of guardian or conservator shall be submitted to the office.

(6) A purchaser's prepaid tuition contract may be assigned upon the marital dissolution of a purchaser and his spouse in accordance with a court order assigning the prepaid tuition contract in a form accepted by the office. Upon the dissolution of marriage of a purchaser, all rights and obligations of the purchaser under a prepaid tuition contract shall only be assigned pursuant to a court order assigning the prepaid tuition contract to the purchaser's ex-spouse.

(7) Any assignment of a prepaid tuition contract in accordance with this section shall be considered valid upon approval by the office and the assignee shall then become the purchaser of the prepaid tuition contract with all rights and obligations of the original purchaser. Upon the valid assignment of a prepaid tuition contract in accordance with this section, the prior purchaser shall retain no rights or interest in the prepaid tuition contract.

History

RELATES TO: KRS 164A.700, 164A.707, 26 U.S.C. 529
STATUTORY AUTHORITY: KRS 164A.704(1), (6), 164A.707(2)(e), 2003 Ky. Acts ch. 156, Part IX, Sec. 46, EO 2003-652
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164A.704(1) requires the board to promulgate administrative regulations to implement KRS 164A.700 to 164A.709. KRS 164A.704(6) provides that the board shall develop requirements, procedures, and guidelines regarding prepaid tuition contracts. KRS 164A.707(2) authorizes a purchaser to amend certain terms of a prepaid tuition contract, including provisions of the prepaid tuition contract as permitted by the board. 2003 Ky. Acts ch. 156, Part IX, Section 46, and EO 2003-652 transferred the governance and administration of the Prepaid Tuition Program from the Department of Treasury to the Kentucky Higher Education Assistance Authority. This administrative regulation establishes the requirements for amending a prepaid tuition contract.
History: 30 Ky.R. 760; 1195; eff. 12-1-2003; Cert eff. 9-28-2018; Cert eff. 10-1-2024.

11 KAR 17:070 Using prepaid tuition contract benefits {#sec-11-kar-17-070 omnilex-key=us-ky-regs-official--title-11--11 KAR 17:070}

Section 1. Payment of Value of the Prepaid Tuition Contract to an Eligible Educational Institution.

(1) A purchaser shall submit sufficient documentation to the office indicating the admission of a qualified beneficiary at an eligible educational institution. Failure to timely submit this written notice to the office shall result in the assessment of a late notice fee as required by 11 KAR 17:100 and delay in the payment from the fund for qualified postsecondary education expenses.

(2) Payments for qualified postsecondary education expenses shall be paid by the fund only if the prepaid tuition contract has been paid up-to-date, including payment of all applicable administrative fees.

Section 2. Remaining Prepaid Tuition Contract Value.

(1) If the value of the prepaid tuition account exceeds the amount paid by the fund to an eligible educational institution on behalf of a qualified beneficiary, the purchaser may make a written request to the office for payment of any remaining value for any qualified postsecondary education expenses.

(2) If a qualified beneficiary receives a scholarship which eliminates or reduces the amount of tuition to be paid to the eligible educational institution at which the qualified beneficiary is enrolled, the purchaser may request in writing to the office to:

(a) Use any remaining value of the prepaid tuition contract for the payment of other qualified postsecondary education expenses; or

(b) Receive a refund for the academic year under KRS 164A.709(5).

History

RELATES TO: KRS 164A.705, 164A.709
STATUTORY AUTHORITY: KRS 164A.704(1), (6), 2003 Ky. Acts ch. 156, Part IX, Sec. 46, EO 2003-652
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164A.704(1) requires the board to promulgate administrative regulations to implement KRS 164A.700 to 164A.709. KRS 164A.704(6) provides that the board shall develop requirements, procedures, and guidelines regarding prepaid tuition contracts. 2003 Ky. Acts ch. 156, Part IX, Section 46, and EO 2003-652 transferred the governance and administration of the Prepaid Tuition Program from the Department of Treasury to the Kentucky Higher Education Assistance Authority. This administrative regulation establishes the procedure and guidelines for using prepaid tuition contract benefits if a qualified beneficiary is accepted and enrolled in an eligible educational institution.
History: 30 Ky.R. 761; 1196; eff. 12-1-2003; Cert eff. 9-28-2018; Cert eff. 10-1-2024.

11 KAR 17:080 Terminating a prepaid tuition contract {#sec-11-kar-17-080 omnilex-key=us-ky-regs-official--title-11--11 KAR 17:080}

Section 1. Termination.

(1) To terminate a contract pursuant to KRS 164A.709(2)(a) or (5), the following documentation shall be submitted in a written request to the office to terminate a prepaid tuition contract:

(a) For termination due to the death or disability of a qualified beneficiary, the purchaser shall submit sufficient documentation evidencing the death or disability of the qualified beneficiary; or

(b) For termination due to a qualified beneficiary's receipt of a scholarship to an eligible educational institution, the purchaser shall submit sufficient documentation evidencing the beneficiary's eligibility of the scholarship and the scholarship amount.

(2) In accordance with KRS 164A.709(2)(a) or (5), a purchaser shall be notified of the date of the termination of the prepaid tuition contract and any applicable refund amount.

Section 2. Termination Due to Fraud or Misrepresentation. If a prepaid tuition contract is terminated by the board pursuant to KRS 164A.709(8) due to the fraud or misrepresentation of a purchaser or qualified beneficiary, a refund shall be:

(1) Paid in accordance with 11 KAR 17:090; and

(2) Offset by the applicable fees and costs incurred by the board as a result of the fraud or misrepresentation.

History

RELATES TO: KRS 164A.709
STATUTORY AUTHORITY: KRS 164A.704(1), (6), 2003 Ky. Acts ch. 156, Part IX, Sec. 46, EO 2003-652
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164A.704(1) requires the board to promulgate administrative regulations to implement KRS 164A.700 to 164A.709. KRS 164A.704(6) provides that the board shall develop requirements, procedures, and guidelines regarding prepaid tuition contracts. 2003 Ky. Acts ch. 156, Part IX, Section 46, and EO 2003-652 transferred the governance and administration of the Prepaid Tuition Program from the Department of Treasury to the Kentucky Higher Education Assistance Authority. This administrative regulation establishes the requirements for terminating a prepaid tuition contract.
History: 30 Ky.R. 763; 1196; eff. 12-1-2003; Cert eff. 9-28-2018; Cert. eff. 10-1-2024.

11 KAR 17:090 Refunds and transfers {#sec-11-kar-17-090 omnilex-key=us-ky-regs-official--title-11--11 KAR 17:090}

Section 1. Refunds.

(1) A purchaser shall make a written request to the office for any refund that may be due to him from a prepaid tuition contract in accordance with 11 KAR 17:080, Section 1.

(2) All requested refunds shall be subject to approval by the office.

(3) A purchaser shall be notified of the amount of refund due. Any outstanding administrative fees required by 11 KAR 17:100 shall be deducted from the amount of the refund.

(4) All refunds shall be paid to the purchaser by the office from the fund in either a one (1) time lump sum payment or installment payments. If a refund is paid to the purchaser in installment payments, interest shall not accrue on the installment payments.

Section 2. Transfers.

(1) A prepaid tuition account may be transferred to another qualified tuition program as defined in 26 U.S.C. 529 in accordance with this section and applicable provisions of 26 U.S.C. 529. A purchaser shall make a written request for transfer of funds from the prepaid tuition account to another qualified tuition program and submit sufficient documentation, as requested by the office, to confirm the qualified status of the recipient tuition program.

(2) Upon transfer of a prepaid tuition account, the purchaser's prepaid tuition contract shall be terminated and considered null and void and the purchaser shall retain no claim or right to payment of any amount from the fund.

(3) A transfer shall:

(a) Consist of all contributions made to the KAPT account; and

(b) Not be a portion of contributions made to the prepaid tuition account.

History

RELATES TO: KRS 164A.709
STATUTORY AUTHORITY: KRS 164A.704(1), (6), 2003 Ky. Acts ch. 156, Part IX, Sec. 46, EO 2003-652
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164A.704(1) requires the board to promulgate administrative regulations to implement KRS 164A.700 to 164A.709. KRS 164A.704(6) provides that the board shall develop requirements, procedures, and guidelines regarding prepaid tuition contracts. 2003 Ky. Acts ch. 156, Part IX, Section 46, and EO 2003-652 transferred the governance and administration of the Prepaid Tuition Program from the Department of Treasury to the Kentucky Higher Education Assistance Authority. KRS 164A.709 authorizes refunds and transfers from a prepaid tuition contract. This administrative regulation establishes the requirements for refunds and transfers from a prepaid tuition contract.
History: 30 Ky.R. 764; 1196; eff. 12-1-2003; Cert eff. 9-28-2018; Cert eff. 10-1-2024.

11 KAR 17:100 Administrative fees {#sec-11-kar-17-100 omnilex-key=us-ky-regs-official--title-11--11 KAR 17:100}

Section 1. Payment of Fees.

(1) All fees required under this administrative regulation shall be paid in cash by means of the method of payment authorized in 11 KAR 17:050, Section 2(1)(a) through (f).

(2) A prepaid tuition contract benefit shall not be paid by the office from the fund until all applicable administrative fees have been paid by the purchaser.

(3) Upon notice to the purchaser, the office may reduce the value of the prepaid tuition contract in an amount equal to the outstanding administrative fees due from the purchaser.

Section 2. Application Fee.

(1) A fifty (50) dollar application fee shall be required for each application. This fee shall be separate from any prepaid tuition contract payments due under a payment schedule and shall be nonrefundable.

(2) The board shall determine the method of payment for the application fee.

Section 3. Account Maintenance Fee.

(1) All prepaid tuition contract payments shall include a nonrefundable account maintenance fee.

(2) For prepaid tuition contracts paid in a lump sum, the account maintenance fee shall be ten (10) dollars per year until enrollment of the qualified beneficiary in an eligible educational institution or termination of the contract.

(3) For prepaid tuition contracts that are paid in monthly installments, the account maintenance fee shall be one (1) dollar per month until enrollment of the qualified beneficiary in an eligible educational institution or termination of the contract.

Section 4. Termination Fee.

(1) A fee of $150 or fifty (50) percent of the total tuition plan payments made, whichever is less, shall be assessed against the purchaser for the termination of a prepaid tuition contract. The fee shall be exclusive of all other administrative fees.

(2) This fee shall be waived if the prepaid tuition contract is terminated due to the death or disability or scholarship of the qualified beneficiary.

Section 5. Change in Beneficiary Fee.

(1) A fee of twenty (20) dollars shall be assessed to transfer the benefits of a prepaid tuition contract to a new beneficiary.

(2) The fund shall waive this fee if:

(a) The designation of a new beneficiary is due to the death, disability, or receipt of scholarship of the original qualified beneficiary; and

(b) The purchaser:

Requests waiver of this fee by written request to the fund; and
Includes sufficient documentation of the death, disability, or receipt of scholarship of the original qualified beneficiary.

Section 6. Change in Purchaser Fee.

(1) A fee of twenty (20) dollars shall be assessed to transfer the rights and obligations of a prepaid tuition contract to a new purchaser.

(2) The fund shall waive this fee if:

(a) The designation of the substitute purchaser is due to the death or disability of the purchaser; and

(b) The substitute purchaser:

Requests waiver of this fee in a written request; and
Includes sufficient documentation of the death or disability of the purchaser.

Section 7. Change in Payment Schedule Fee. A fee of ten (10) dollars shall be assessed for any change to a payment schedule requested by a purchaser.

Section 8. Other Prepaid Tuition Contract Changes Fee. A fee of ten (10) dollars shall be assessed for any other change not specifically listed in 11 KAR 17:060 that is made to a prepaid tuition contract requested by a purchaser.

Section 9. Late Payment Fee. A fee of ten (10) dollars shall be assessed each month for each payment made past its scheduled date.

Section 10. Returned Payment Fee. A fee of fifteen (15) dollars shall be assessed for any payment made to the fund that is returned to the purchaser for insufficient funds or other reason which causes the payment not to be processed. This fee shall apply to all prepaid tuition contract payments and administrative fee payments that are returned.

Section 11. Document Replacement.

(1) In accordance with KRS 61.874(3) and 61.876(3) and 200 KAR 1:020, a fee of ten (10) cents per page shall be assessed for each document that the purchaser requests.

(2) For documents requiring additional postage beyond the rate for a first class letter and for documents requiring overnight delivery, an additional fee shall be assessed equal to the cost of postage, not to exceed fifteen (15) dollars.

Section 12. Late Notice Fee.

(1) A fee of twenty (20) dollars shall be assessed for any notice required under 11 KAR 17:070, Section 1(1), which is received later than the deadline established by the board.

(2) This fee shall be paid by the purchaser before any tuition shall be paid to an eligible educational institution on behalf of the qualified beneficiary.

History

RELATES TO: KRS 164A.701(6), 164A.704(1), 164A.709(4)
STATUTORY AUTHORITY: KRS 164A.701(6), 164A.704(1), (6)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164A.704(1) requires the board to promulgate administrative regulations, set fees, and adopt procedures to implement KRS 164A.700 to 164A.709. KRS 164A.704(6) provides that the board shall develop requirements, procedures, and guidelines regarding prepaid tuition contracts. This administrative regulation establishes the administrative fees related to a prepaid tuition contract.
History: 30 Ky.R. 765; 1197; eff. 12-1-2003; 31 Ky.R. 378; 698; eff. 11-5-2004; Cert eff. 9-28-2018; Cert eff. 10-1-2024.

11 KAR 17:110 Grievance procedure {#sec-11-kar-17-110 omnilex-key=us-ky-regs-official--title-11--11 KAR 17:110}

Section 1. Request for Review.

(1) A purchaser, beneficiary, or related party affected by a decision of the office may request review of the decision by the board, which shall make a determination regarding the claim. The request shall be submitted in writing to the board and shall include the following information:

(a) Name and address of person requesting relief;

(b) Specific nature of relief requested;

(d) Prepaid tuition contract number;

(e) Date of request;

(f) Each statute or administrative regulation involved; and the

(g) Notarized signature of the person requesting relief.

(2) The board shall suspend the payment of benefits under the prepaid tuition contract upon receipt of a request for review, if requested by the purchaser, beneficiary or related party.

(3) The board shall inform the purchaser, beneficiary, and related parties of the board's decision in writing by certified mail citing all applicable terms and conditions of the prepaid tuition contract, applicable administrative regulations, and other applicable statutes upon which the board's decision was based. The board's decision shall be made no later than 120 days following receipt of the request for review.

Section 2. Request for Administrative Hearing.

(1) A claim that is denied by the board may be appealed by the affected party within sixty (60) days of the date of claim denial by the board. The appeal shall be submitted in writing to the board.

(2) Upon receipt of a request for an administrative hearing, the board shall set the date, time, and place of the hearing and forthwith notify the individual by regular U.S. mail.

(3) An administrative hearing conducted pursuant to this section shall be held in accordance with KRS Chapter 13B.

History

RELATES TO: KRS Chapter 13B, 164A.700-164A.709
STATUTORY AUTHORITY: KRS 164A.704(1), (6), 2003 Ky. Acts ch. 156, Part IX, Sec. 46, EO 2003-652
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164A.704(1) requires the board to promulgate administrative regulations, set fees, and adopt procedures to implement KRS 164A.700 to 164A.709. KRS 164A.704(6) provides that the board shall develop requirements, procedures, and guidelines regarding prepaid tuition contracts. 2003 Ky. Acts ch. 156, Part IX, Section 46, and EO 2003-652 transferred the governance and administration of the Prepaid Tuition Program from the Department of Treasury to the Kentucky Higher Education Assistance Authority. This administrative regulation establishes the grievance procedure for interested parties to request review of a decision by the office relating to a prepaid tuition contract.
History: 30 Ky.R. 766; 1198; eff. 12-1-2003; Cert eff. 9-28-2018; Cert eff. 10-1-2024.

Chapter 19 Coal County Scholarship Program for Pharmacy Students

11 KAR 19:010 Coal County Scholarship Program for pharmacy students {#sec-11-kar-19-010 omnilex-key=us-ky-regs-official--title-11--11 KAR 19:010}

Section 1. Definitions.

(1) "Authority" is defined by KRS 164.740(1).

(2) "Coal-producing county" is defined by KRS 164.7890(2).

(4) "Eligible student" means any individual who satisfies the requirements set forth in KRS 164.7890(3) and (5).

(5) "Full-time practice" means providing services as a pharmacist in a coal-producing county for a minimum of 2,000 hours per calendar year.

(6) "Home County" means the county of permanent home residence of the student at the time in which the application is made, as determined by a preponderance of evidence such as a student's permanent address, parent's mailing address, parent's tax returns, location of high school of graduation and additional criteria as needed for a determination of residency status in accordance with 13 KAR 2:045.

(7) "Qualified service" is defined in KRS 164.7890(3)(c).

Section 2. Eligibility of Applicants and Selection Process.

(1) Applicants shall complete the Coal County Scholarship Program for Pharmacy Students Application as required by 11 KAR 4:080, Section 1(7), according to its instructions. The applicant shall ensure that the completed application is received by the authority on or before May 1, or the next regular business day if May 1 falls on a weekend or holiday, preceding the academic year for which the award is requested.

(2) Eligibility of renewal applicants. A person who previously received a loan or scholarship pursuant to KRS 164.7890 shall be eligible to apply for and be considered for a renewal coal county scholarship if, at the time of application and disbursement, the renewal applicant has made satisfactory progress toward completion of the eligible program of study in accordance with the standards prescribed by the participating institution.

(3) Recipients shall be selected from among eligible applicants in the following order:

(a) Renewal applicants whose home counties are coal-producing counties; and

(b) Initial applicants whose home counties are coal-producing counties.

(4) If there are more applicants within a category listed in subsection (3) of this section than there are funds available, the applications in each category shall be ranked to receive available funds by date of receipt of application.

Section 3. Entrance Counseling.

(1) Each participating institution shall conduct entrance counseling for each scholarship recipient prior to requesting scholarship funds from the Authority on the recipient's behalf.

(2) The counseling shall be provided through either in-person sessions or by electronic or written means with the recipient's acknowledgement of receipt thereof.

(3) The following topics shall be covered through the counseling:

(a) The recipient's obligation to repay the scholarship if the recipient fails to provide qualified service as required under the program;

(b) The consequences of defaulting on any repayment obligation imposed under this program;

(c) The recipient's obligation to repay the scholarship even if the recipient is not satisfied with the quality of education received, does not complete the program of study, or does not find employment in the appropriate field or service area after graduation; and

(d) The importance of contacting the authority to advise of any change with respect to the recipient's name, address, enrollment status, or other contact information.

Section 4. Disbursements.

(1) Each disbursement of a coal county scholarship shall be evidenced by a promissory note, prescribed by the authority, in which the scholarship recipient shall agree to repay the scholarship funds or render qualified pharmacy service in lieu thereof.

(2) Within thirty (30) days following receipt by the authority of the original signed promissory note for the student awarded a coal county scholarship, the authority shall send to the institution a roster containing the recipient's name and Social Security number.

(3) The participating institution shall verify the student's full-time enrollment in a Pharm D. program and completion of entrance counseling on the roster and return it to the authority.

(4) Upon receipt of the institution's completed roster, the authority shall disburse funds to the institution on behalf of all eligible students to receive the scholarship by electronic funds transfer.

(5) Disbursement of a coal county scholarship shall be made at the beginning of each fall and spring term.

(6) The participating institution shall be responsible for proper delivery of the funds. Upon the receipt of funds, the participating institution shall immediately credit the recipient's account and notify the recipient in writing that it has so credited that account, and deliver to the recipient any remaining scholarship proceeds.

(7) The participating institution shall retain record of the date funds were either credited to the student's account or disbursed to the student, the name of a recipient for whom funds are being returned, the amount being returned, and the reason funds are being returned.

(8) If a recipient withdraws or is expelled prior to the first day of classes of the period of enrollment for which the scholarship is awarded, the institution shall return the proceeds to the authority.

(9)

(a) If a recipient subsequently refuses to repay the scholarship on grounds that the student was unaware of or did not receive delivery of the scholarship proceeds from the school, upon written request from the authority, the institution shall promptly provide documentary evidence to the authority that the recipient received or had funds credited to the student's account and was notified of this transaction.

(b) The school shall otherwise reimburse the authority for any amount of the scholarship that is unenforceable absent that documentary evidence.

Section 5. Refunds.

(1) If a student fails to enroll, withdraws, is expelled from the institution, or otherwise fails to complete the program on or after the student's first day of class of the period of enrollment or changes enrollment status, the Authority shall be due a refund of monies paid to the institution on behalf of that student or a repayment of cash disbursements made to the student for educational expenses.

(3) The institution shall adopt and implement a fair and equitable refund policy for financial assistance administered by the authority which shall be:

(a) A clear and conspicuous written statement;

(b) Made available to a prospective student, prior to the earlier of the student's enrollment or the execution of the student's enrollment agreement, and to currently-enrolled students;

(d) Made available to the authority upon request.

(4) The institution's refund policy for financial assistance administered by the authority shall either:

(a) Use the same methods and formulas for determining the amount of a refund as the institution uses for determining the return of federal financial assistance funds; or

(b) Be a separate and distinct policy adopted by the institution that is based upon:

The requirements of applicable state law; or
The specific refund standards established by the institution's nationally-recognized accrediting agency.

(6) If the institution determines that a refund of financial assistance is due in accordance with its policy, the institution shall allocate to the financial assistance programs administered by the authority the refund and repayment prior to allocating the refund to institutional or private sources of financial assistance.

(7)

(a) If a coal county scholarship recipient officially or unofficially withdraws from or is expelled by an institution before the first day of classes of the award period, the award shall constitute an over award and a full refund and repayment of the coal county scholarship shall be required, notwithstanding any institutional policy to the contrary.

(b) If the institution is unable to document the student's last date of attendance, any coal county scholarship disbursement for that award period shall be subject to full refund.

(c) If a coal county scholarship recipient's enrollment is terminated with no assessment of tuition and fees by the institution, the full coal county scholarship shall be subject to:

Cancellation, if not yet disbursed; or
Refund if the coal county scholarship has already been disbursed.

(8)

(b) Refunds by the institution transmitted to the authority shall be accompanied by:

The student's name and Social Security Number;
The reason for the refund;
The date of enrollment status change; and
The semester and year.

(c) Failure of the institution to make restitution if required shall, without precluding other remedies, be cause for limitation, suspension, or termination of the participation of the institution in accordance with 11 KAR 4:020.

Section 6. Notification Requirements.

(1) A scholarship recipient shall notify the authority in writing within thirty (30) days of:

(a) Cessation of full-time enrollment in a pharmacy program;

(b) Certification to practice pharmacy in the Commonwealth of Kentucky;

(d) Employment in a qualified service position;

(e) Cessation of employment in a qualified service position;

(f) Failure, within 180 days following certification to practice pharmacy in the Commonwealth of Kentucky, to obtain employment in full-time practice in a coal-producing county within the Commonwealth of Kentucky as a certified pharmacist for a majority of the calendar year; or

(g) Change of name, permanent home address, or place of employment.

(2) The school of pharmacy shall notify the authority in writing within thirty (30) days of learning that a Coal County Scholarship Program for Pharmacy Students award recipient ceases to be enrolled on a full-time basis in the school of pharmacy.

Section 7. Records.

(1) A participating institution shall maintain complete and accurate records pertaining to the eligibility, enrollment, and progress of each student receiving aid under this program and the disbursement of funds and institutional charges necessary to audit the disposition of these funds.

(2) The institution's records shall be maintained for at least three (3) years after the student ceases to be enrolled at the institution.

History

RELATES TO: KRS 164.740, 164.7890
STATUTORY AUTHORITY: KRS 164.744(2), 164.748(4), 164.753(3), 164.7890(9)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.744(2) authorizes the authority to provide scholarships. KRS 164.748(4) and 164.753(3) require the authority to promulgate administrative regulations pertaining to the awarding of scholarships as provided in KRS 164.740 to 164.7891. KRS 164.7890(9) requires the authority to promulgate administrative regulations establishing the terms and conditions for the award, cancellation, and repayment of coal county scholarships for pharmacy students. This administrative regulation establishes the eligibility, application, and disbursement requirements for scholarships provided under the program.
History: 37 Ky.R. 1923; 2150; eff. 4-1-2011; 41 Ky.R. 1130; 1504; eff. 2-6-2015; Crt eff. 9-28-2018; Crt eff. 2-28-2025.

11 KAR 19:020 Service cancellation and repayment of Coal County Pharmacy Scholarship {#sec-11-kar-19-020 omnilex-key=us-ky-regs-official--title-11--11 KAR 19:020}

Section 1. Definitions.

(1) "Coal-producing county" is defined in KRS 164.7890(2).

(3) "Full-time practice" means providing services as a pharmacist in a coal-producing county for a minimum of 2,000 hours per calendar year.

(4) "Qualified service" is defined in KRS 164.7890(3)(d).

Section 2. Cancellation.

(1) A recipient shall receive cancellation under this program for each year during which service is provided as specified in KRS 164.7890(5)(b) if the recipient:

(a) Has completed the program of study;

(b) Has provided qualified service in a coal-producing county in Kentucky; and

(2) A recipient rendering qualified service shall remain eligible for the credit cancellation if:

(a) The county in which qualified service is provided ceases to be a coal-producing county as defined in KRS 164.7890(2); and

(b) The recipient continues to render continuous qualified service in the area.

Section 3. Repayment.

(1) Interest at the rate of six (6) percent per annum shall be applicable to the coal county scholarship under this section and shall begin accruing upon disbursement of the award.

(2) If repayment becomes necessary pursuant to KRS 164.7890(5)(c), the authority shall send a written notification of demand for repayment to the scholarship recipient's last known address. The notification shall be effective upon mailing.

Section 4. Application of Payment.

(1) The authority may agree to accept repayment in installments in accordance with a schedule established by the authority.

(2) Payments shall first be applied to interest and then to principal on the earliest unpaid promissory note.

(3) If a repayment obligation subsequently becomes eligible for service credit cancellation as a result of the recipient's provision of pharmacy service, refund of payments previously made shall not be given to the recipient.

Section 5. Default.

(2) A recipient whose repayment obligation has defaulted and who subsequently begins providing pharmacy service in a coal-producing county in the Commonwealth of Kentucky shall be removed from default status.

Section 6. Rehabilitation.

(1) The authority shall offer a recipient in default under this program an opportunity to rehabilitate the loan obligation in order to remove it from default.

(2) A defaulted recipient interested in pursuing loan rehabilitation shall contact the authority and enter into a written agreement to submit six (6) consecutive, voluntary, on-time monthly payments to the agency of the Commonwealth currently charged with collecting the obligation.

(3) At the completion of the rehabilitation repayment agreement, the recipient's loan shall be removed from default and the account shall be transferred back to the authority which shall resume servicing the loan.

(4) A refund of fees or charges assessed during the default period shall not be due a recipient who completes rehabilitation.

(5) A recipient whose loan obligation has been removed from default due to rehabilitation shall not be eligible for subsequent rehabilitation if there is a subsequent default.

Section 7. Disability Discharge. A conditional or permanent discharge of the repayment obligation required by this program shall be granted by the Authority upon submission by the recipient of the documentation required by this section.

(a) A finding of permanent disability by the Social Security Administration; or

(b) A statement by the recipient's treating physician that:

Identifies:

a. The nature of the condition; and

b. The date the condition occurred; and

Certifies that the:

a. Recipient is unable to work or earn money; and

b. Condition is expected to persist indefinitely.

(2) Permanent discharge. At the expiration of the two (2) year Conditional Discharge period specified in subsection (1) of this section, the Authority shall grant a permanent discharge to a recipient under this program upon the Authority's review of the submission by the recipient of current documentation verifying that the qualifying disability continues to exist at the time the documentation is submitted.

History

RELATES TO: KRS 164.740, 164.7890
STATUTORY AUTHORITY: KRS 164.744(2), 164.748(4), 164.753(3), 164.7890(9)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.744(2) authorizes the authority to provide scholarships. KRS 164.748(4) and 164.753(3) require the authority to promulgate administrative regulations pertaining to the awarding of scholarships as provided in KRS 164.740 to 164.7891. KRS 164.7890(9) requires the authority to promulgate administrative regulations establishing the terms and conditions for the award, cancellation, and repayment of coal county scholarships for pharmacy students. This administrative regulation establishes the requirements for service cancellation and repayment of scholarships provided under the program.
History: 37 Ky.R. 1925; 2152; eff. 4-1-2011; Crt eff. 9-28-2018; Crt eff. 2-25-2025.

11 KAR 19:030 Deferment of Repayment of Coal County Scholarships for Pharmacy Students {#sec-11-kar-19-030 omnilex-key=us-ky-regs-official--title-11--11 KAR 19:030}

Section 1. Definitions.

(1) "Authority" is defined by KRS 164.740(1).

(2) "Coal-producing county" is defined in KRS 164.7890(2).

(4) "Deferment" means a temporary waiver of the obligation of a recipient of a coal county scholarship for pharmacy students to make payments to the authority, pursuant to one (1) or more promissory notes executed between the recipient and the authority, which is granted by the authority, for a specified period of time, upon a showing of cause by the recipient.

(5) "Full-time practice" means providing services as a pharmacist in a coal-producing county for a minimum of 2,000 hours per calendar year.

(6) "Qualified service" is defined in KRS 164.7890(3)(e).

Section 2. Request for Deferment.

(1) The recipient shall request a deferment in writing by submitting to the Authority complete and accurate information verifying the recipient's circumstances that qualify for deferment in accordance with this administrative regulation.

Section 3. Effect on Repayment.

(1) During a deferment, principal or interest payments shall not be required. Interest shall:

(a) Continue to accrue on the unpaid principal balance owed by the recipient during a period specified in Section 4(1), (4), and (5) of this administrative regulation; and

(b) Not accrue during a period specified in Section 4(2) or (3) of this administrative regulation.

(2) The authority shall not grant a deferment that legally impairs the ultimate recovery of the principal and accrued interest otherwise owed by the recipient.

Section 4. Types of Deferment. Except as provided in Section 5 of this administrative regulation, if the requirements established in this section are met, the authority shall grant an enrollment deferment, disability deferment, unemployment deferment, hardship deferment, military service deferment or residency deferment.

(1) Enrollment deferment.

(a) An enrollment deferment shall be granted to a recipient who is enrolled on at least a half-time basis at an eligible institution in the United States.

(b) Each semester, the recipient shall provide to the Authority written certification from the recipient's institution of current enrollment.

(c) The Authority shall grant deferment of repayment upon this basis for a period not to exceed an aggregate of forty-eight (48) months.

(2) The Authority shall grant deferment of repayment for periods not to exceed an aggregate of thirty-six (36) months for any one (1) or combination of the following circumstances, unless a documented extenuating circumstance is approved by the executive director of the authority:

(a) Disability deferment.

A disability deferment shall be a deferment granted to a recipient who is:

a. Temporarily totally disabled and, therefore, unable to obtain full-time employment or attend school; or

b. Unable to obtain full-time employment or attend school due to the temporary total disability of the recipient's spouse who:

(i) Requires continuous (twenty-four (24) hour) nursing or similar care by the recipient; and

(ii) Is not confined to a hospital, nursing home, intermediate care facility, or similar institution.

For purposes of a disability deferment, a recipient, or the spouse of a recipient, shall be considered temporarily totally disabled if the person suffers an injury or illness which necessitates an extended or indefinite period of recovery which can be expected to preclude gainful employment or school attendance.
The recipient shall provide to the authority a statement from a licensed physician certifying that the recipient or spouse is temporarily totally disabled in accordance with subparagraphs 1 and 2 of this paragraph. The recipient shall be solely responsible for securing the physician's certification.
The authority shall grant a disability deferment subject to an annual review of the physician's certification.
After the third year of a disability deferment, the authority shall cancel the debt if it appears that the disability is expected to continue for an indefinite time.

(b) Unemployment deferment. An unemployment deferment shall be granted to a recipient seeking, but unable to obtain, a service-creditable position as a pharmacist in a coal-producing county within six (6) months following completion of a pharmacy program at a participating institution. The recipient shall:

Be eligible to begin practice as a pharmacist;
Have applied for a service-creditable position with at least three (3) employers within Kentucky coal-producing counties;
Not have refused an offer of employment in a service-creditable pharmacy position within a Kentucky coal-producing county to which the recipient applied; and
Provide the authority with a signed statement which sets forth:

a. The recipient's current address;

b. The names of the employers to which the recipient has applied for qualified service-creditable employment as a pharmacist; and

c. The recipient's agreement to notify the authority if the recipient obtains full-time employment in a service-creditable position.

Enrollment in a pharmacy program or employment in a service-creditable pharmacy position is temporarily interrupted due to circumstances beyond the recipient's control, including major illness, accident or death in the family, after which the recipient intends to resume enrollment in a pharmacy program or a full-time pharmacy practice; or
The recipient is insolvent due to circumstances beyond his control, including natural disaster, involuntary unemployment, or unforeseen medical expenses.

(4) Residency deferment. The authority shall grant a deferment for a maximum of twenty-four (24) months to a recipient who provides proof of participation in a qualified pharmacy residency program.

(5) Pharmacy service deferment. A deferment shall be granted to a recipient who, due to verified current employment in a service-creditable position as a pharmacist in a coal-producing Kentucky county, is reasonably expected, on an annual basis, to qualify for cancellation benefits pursuant to 11 KAR 19:020.

Section 5. Upon default of a repayment obligation under this program, a recipient shall be permanently barred from eligibility for the deferment options provided for in this administrative regulation unless the obligation is rehabilitated as provided in 11 KAR 19:020, Section 6.

History

RELATES TO: KRS 164.740, 164.7890
STATUTORY AUTHORITY: KRS 164.744(2), 164.748(4), 164.753(3), 174.7890(9)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.744(2) authorizes the authority to provide scholarships. KRS 164.748(4) and 164.753(3) require the authority to promulgate administrative regulations pertaining to the awarding of scholarships as provided in KRS 164.740 to 164.7891. KRS 164.7890(9) requires the authority to promulgate administrative regulations establishing the terms and conditions for the award, cancellation, and repayment of coal county scholarships for pharmacy students including deferments. This administrative regulation establishes conditions for deferment of the repayment obligation.
History: 37 Ky.R. 1927; 2153; eff. 4-1-2011; TAm 3-11-2016; Crt eff. 9-28-2018; Crt eff. 2-28-2025.

Chapter 20 Coal County College Completion Program

11 KAR 20:001 Definitions for 11 KAR Chapter 20 {#sec-11-kar-20-001 omnilex-key=us-ky-regs-official--title-11--11 KAR 20:001}

Section 1. Definitions.

(1) "Academic term" means the fall or spring semester at a postsecondary institution and does not include summer sessions.

(2) "Academic year" means a period of time that begins July 1 of a calendar year and ends June 30 of the next succeeding calendar year.

(3) "Authority" is defined by KRS 164.740(1).

(4) "Census date" means the date set by the institution that marks the end of the add/drop period.

(5) "District" is defined by KRS 164.7894(2)(a).

(6) "Full-time" means enrollment in a postsecondary program of study that meets the full-time requirements of the participating or nonparticipating institution in which the student is enrolled, typically consisting of a minimum of twelve (12) credit hours per semester.

(7) "Half-time" means enrollment in a postsecondary program of study that amounts to at least one-half (1/2) the workload required for full-time enrollment, as determined by the participating or nonparticipating institution, typically consisting of a minimum of six (6) credit hours per semester.

(8) "High school" is defined by KRS 164.7894(2)(b).

(9) "Kentucky Coal County College Completion scholarship" or "KCCCC scholarship" is defined by KRS 164.7894(2)(c).

(10) "Kentucky Coal County College Completion student services grant" or "KCCCC student services grant" is defined by KRS 164.7894(2)(d).

(11) "Nonparticipating institution" is defined by KRS 164.7894(5).

(12) "Participating institution" is defined by KRS 164.7894(3).

(13) "Tuition" is defined by KRS 164.7894(2)(e).

History

RELATES TO: KRS 164.7894
STATUTORY AUTHORITY: KRS 164.744(2), 164.7894
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.744(2) authorizes the authority to provide scholarships. KRS 164.7894(6) requires the authority to promulgate administrative regulations as may be needed for the administration of the program. This administrative regulation defines terms used in 11 KAR Chapter 20 pertaining to the Kentucky Coal County College Completion Program.
History: 41 Ky.R. 1240; 1506; eff. 2-6-2015; Crt eff. 9-28-2018; Crt eff. 2-28-2025.

11 KAR 20:010 Student eligibility requirements {#sec-11-kar-20-010 omnilex-key=us-ky-regs-official--title-11--11 KAR 20:010}

Section 1. Eligibility of Students. In order to qualify for disbursement of a Kentucky Coal County College Completion Program scholarship, a student shall:

(1) Comply with KRS 164.7894(7);

(2) Have remaining KCCCC scholarship limit; and

(3) Not have earned a first baccalaureate degree.

Section 2. Waiver of Default.

(1) If a student is in default, the authority may grant a waiver for cause pursuant to KRS 164.7894(7).

(2) A student may appeal a denial of the award in accordance with 11 KAR 4:030.

History

RELATES TO: KRS 164.7894
STATUTORY AUTHORITY: KRS 164.744(2), 164.7894
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.744(2) authorizes the authority to provide scholarships. KRS 164.7894(6) requires the authority to promulgate administrative regulations as may be needed for the administration of the program. This administrative regulation establishes the student eligibility requirements under this program.
History: 41 Ky.R. 1241; 1506; eff. 2-6-2015; Crt eff. 9-28-2018; Crt eff. 2-28-2025.

11 KAR 20:020 Application and certification {#sec-11-kar-20-020 omnilex-key=us-ky-regs-official--title-11--11 KAR 20:020}

Section 1. Application.

(1) In order for an eligible student to be considered for an award under this program, the student shall complete:

(a) The Kentucky Coal County College Completion Scholarship Application online as set forth in 11 KAR 4:080, Section 1(8)(b), from the KHEAA Web site, http//www.kheaa.com/; and

(b) The Free Application for Federal Student Aid (FAFSA) as set forth in 11 KAR 4:080, Section 1(8)(a).

(2) The application period for this program shall be January 1 through May 1 preceding the academic year for which the award is requested.

Section 2. Certification.

(1) For each applicant for an award under this program, the institution shall certify to the authority:

(a) The number of credit hours the applicant has successfully completed toward bachelor's degree completion at or prior to the end of the spring semester of the academic year preceding the application award year;

(b) The applicant's status as a permanent resident of a coal-producing county; and

(2) The certification shall be completed and submitted to the authority no later than June 30 preceding the academic year for which the certification is applicable.

History

RELATES TO: KRS 164.7894
STATUTORY AUTHORITY: KRS 164.744(2), 164.7894
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.744(2) authorizes the authority to provide scholarships. KRS 164.7894(6) requires the authority to promulgate administrative regulations as may be needed for the administration of the program. This administrative regulation establishes the student application and school certification procedures to be followed in applying for an award under the Kentucky Coal County College Completion Scholarship Program.
History: 41 Ky.R. 1242; 1507; eff. 2-6-2015; Crt eff. 9-28-2018; Crt eff. 2-28-2025.

11 KAR 20:030 Award determination procedure {#sec-11-kar-20-030 omnilex-key=us-ky-regs-official--title-11--11 KAR 20:030}

Section 1. Awarding.

(1) A person who received a scholarship pursuant to KRS 164.7894 in the spring academic term immediately preceding the award year shall be eligible to apply for and be considered a renewal applicant if the applicant applies by the deadline set forth in 11 KAR 20:020.

(2) Scholarships shall be awarded to eligible certified applicants chronologically based on FAFSA completion date in the following order:

(a) Renewal applicants; and

(b) New applicants.

(3) The maximum scholarship award amount for full-time and less than full-time enrollment shall be calculated as set forth in KRS 164.7894(9). An eligible student enrolled full-time in twelve (12) or more credit hours shall be entitled to the maximum award.

Section 2. Reduction for Less than Full-Time Study.

(1) If an eligible student is enrolled less than full-time for an academic term, the maximum award amount to which the student is entitled shall be as follows:

(a) Fifty (50) percent if enrolled for six (6) credit hours;

(b) Fifty-eight (58) percent if enrolled for seven (7) credit hours;

(d) Seventy-five (75) percent if enrolled for nine (9) credit hours;

(e) Eighty-three (83) percent if enrolled for ten (10) credit hours; and

(f) Ninety-two (92) percent if enrolled for eleven (11) credit hours.

(2) A participating or nonparticipating institution shall determine full-time and less than full-time enrollment status for purposes of this administrative regulation in the same manner as the institution uses to determine enrollment status for Pell Grant eligibility based upon the number of credit hours in which an eligible student is enrolled and in accordance with 34 C.F.R. 668.2.

History

RELATES TO: KRS 164.7894
STATUTORY AUTHORITY: KRS 164.744(2), 164.7894
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.744(2) authorizes the authority to provide scholarships. KRS 164.7894(6) requires the authority to promulgate administrative regulations as may be needed for the administration of the program. This administrative regulation establishes the awarding procedures applicable to the Kentucky Coal County College Completion Scholarship Program.
History: 41 Ky.R. 1244; 1507; eff. 2-6-2015; Crt eff. 9-28-2018; Crt eff. 2-28-2025.

11 KAR 20:040 Disbursement {#sec-11-kar-20-040 omnilex-key=us-ky-regs-official--title-11--11 KAR 20:040}

(1) The student's enrollment status;

(2) The number of credit hours in which the student is enrolled for the academic term; and

(3) For a nonparticipating institution, confirmation of the student's enrollment in an approved bachelor's degree program of study.

Section 2. Disbursement and Delivery of Funds.

(1) The authority shall disburse up to one-half (1/2) of the scholarship awarded for the academic year during each academic term.

(2) Within thirty (30) days following receipt of the eligibility verification record, KCCCC scholarship funds shall be disbursed by the authority to the institution for subsequent delivery to the eligible student or application of the funds to the account of the eligible student.

Section 3.

(1) The educational institution shall:

(a) Be responsible for proper disbursement of scholarship funds to each eligible student during the academic term for which each award is intended;

(b) Not make scholarship funds available to the recipient nor apply those funds to the recipient's account after the end of the academic term for which the funds are received by the institution;

(c) Be liable for disbursement to the wrong individual or to an ineligible student, or for untimely disbursement pursuant to this section; and

(d) Make restitution to the authority of any amount improperly disbursed.

History

RELATES TO: KRS 164.7894
STATUTORY AUTHORITY: KRS 164.744(2), 164.7894
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.744(2) authorizes the authority to provide scholarships. KRS 164.7894(6) requires the authority to promulgate administrative regulations as may be needed for the administration of the program. This administrative regulation establishes the disbursement procedures for awards under the Kentucky Coal County College Completion Scholarship Program.
History: 41 Ky.R. 1245; 1508; eff. 2-6-2015; Crt eff. 9-28-2018; Crt eff. 2-28-2025.

11 KAR 20:050 Refunds and repayment {#sec-11-kar-20-050 omnilex-key=us-ky-regs-official--title-11--11 KAR 20:050}

Section 1.

(1) A student who fails to enroll, withdraws, is expelled from the institution, or otherwise fails to complete the program on or after his or her first day of class of the period of enrollment or changes enrollment status may be due a refund of monies paid to the institution on behalf of that student or may owe a repayment of cash disbursements made to the student for educational expenses.

Section 2.

(1) The institution shall adopt and implement a fair and equitable refund and repayment policy for financial assistance administered by the authority which shall be:

(a) A clear and conspicuous written statement;

(b) Made available to a prospective student, prior to the earlier of the student's enrollment or the execution of the student's enrollment agreement, and to currently enrolled students;

(d) Made available to the authority upon request.

(a) The requirements of applicable state law; or

(b) The specific refund standards established by the institution's nationally recognized accrediting agency.

(a) CAP Grant;

(b) KTG;

(d) Teacher Scholarship;

(e) Kentucky Educational Excellence Scholarship;

(f) Kentucky Coal County College Completion Scholarship;

(g) National Guard Tuition Assistance; and

(h) Early Childhood Development Scholarship.

Section 3. If a scholarship recipient officially or unofficially withdraws from or is expelled by an institution before the first day of classes of the award period, the award shall constitute an overaward and a full refund or repayment of the scholarship shall be required, notwithstanding any institutional policy to the contrary. If the institution is unable to document the student's last date of attendance, any scholarship disbursement for that award period shall be subject to full refund and repayment. If, at any time, a scholarship recipient's enrollment is terminated with no assessment of tuition and fees by the institution, then the full scholarship shall be subject to cancellation, if not yet disbursed, or refund and repayment if the scholarship has already been disbursed.

Section 4.

(2) Refunds by the institution and notification of student repayment due transmitted to the authority shall be accompanied by:

(a) The student's name and Social Security number;

(b) The reason for the refund or repayment;

(d) The semester and year; and

(e) The calculation used for determining the refund or repayment.

History

RELATES TO: KRS 164.7894
STATUTORY AUTHORITY: KRS 164.744(2), 164.7894
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.744(2) authorizes the authority to provide scholarships. KRS 164.7894(6) requires the authority to promulgate administrative regulations as may be needed for the administration of the program. This administrative regulation establishes the apportionment of financial assistance refunds from institutions and repayment from students due to the Kentucky Coal County College Completion Scholarship Program.
History: 41 Ky.R. 1246; 1508; eff. 2-6-2015; Crt eff. 9-28-2018; Crt eff. 2-28-2025.

11 KAR 20:060 Records and reports {#sec-11-kar-20-060 omnilex-key=us-ky-regs-official--title-11--11 KAR 20:060}

Section 1. End-of-Term Reporting.

(1) At the end of each academic term, the institution shall submit to the authority an accurate and complete record of the scholarship recipient's status including:

(a) Number of credit hours successfully completed during the academic term;

(b) Total credit hours earned as of the end of the academic term; and

The date of graduation;
The degree earned; and
The degree major.

(2) Reports under this section shall be completed before funds for the next academic term under this program will be disbursed by the authority.

Section 2. Records and Reports. An educational institution shall:

(1) Establish an organized system of records pertaining to scholarship recipient eligibility;

(2) Maintain these records for a period of not less than three (3) years after the award year in which the recipient ceased enrollment; and

(3) Upon request, make available to the authority:

(a) All records relied upon by that institution to certify that any recipient of funds from the authority is an eligible student; and

(b) Information necessary to verify that the institution has complied with:

11 KAR Chapter 20; and
Representations and requirements contained in its agreement with the authority.

History

RELATES TO: KRS 164.7894
STATUTORY AUTHORITY: KRS 164.744(2), 164.7894
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.744(2) authorizes the authority to provide scholarships. KRS 164.7894(6) requires the authority to promulgate administrative regulations as may be needed for the administration of the program. This administrative regulation establishes recording and reporting requirements for educational institutions under the Kentucky Coal County College Completion Scholarship Program.
History: 41 Ky.R. 1248; 1509; eff. 2-6-2015; Crt eff. 9-28-2018; Crt eff. 2-28-2025.

11 KAR 20:070 Dual enrollment under consortium agreement {#sec-11-kar-20-070 omnilex-key=us-ky-regs-official--title-11--11 KAR 20:070}

Section 1. For purposes of the Kentucky Coal County College Completion Scholarship Program, a student who is otherwise eligible pursuant to 11 KAR 20:010, except that the student is enrolled simultaneously in two (2) or more educational institutions pursuing an eligible program of study jointly offered by those institutions, shall be eligible under this section if:

(1) The program of study is covered by a consortium agreement between the educational institutions;

(2) The student is carrying a combined academic workload at all educational institutions in the consortium equal to full-time enrollment at the primary institution; and

(3) The primary institution is the institution that the student indicated he or she would be attending at the time the award under this program is made.

Section 2. Consortium Agreement. Two (2) or more eligible educational institutions under the Kentucky Coal County College Completion Scholarship Program, as either participating or nonparticipating institutions, may, for purposes of Section 1 of this administrative regulation, execute a consortium agreement which meets the following terms and conditions:

(1) The agreement shall be written and signed by authorized representatives of each participating educational institution;

(2) The agreement shall designate which educational institution will serve as the primary institution; and

(3) The agreement shall specify:

(a) The tuition, fees, room and board cost, and all other costs assessed to the student by each institution; and

(b) That the primary institution will perform the duties set forth in Section 3 of this administrative regulation.

(2) Maintain all records, including information from all participating institutions about the student's grades, institutional costs incurred, financial aid received, enrollment, and all other information related to the student's eligibility as is required to be maintained on any other scholarship recipient enrolled only in the primary institution;

(3) Disburse the Kentucky Coal County College Completion scholarship;

(4) Confer academic credit to the student for all courses completed at other educational institutions under the consortium agreement as if the courses had been provided by the primary institution;

(6) Calculate any refund or repayment and make any refund based on the primary institution's refund policy, based upon any change in enrollment at any of the educational institutions in the consortium, as if the student were enrolled only at the primary institution; and

(7) Provide to the authority, on behalf of all educational institutions in the consortium, all reports and notifications required by KRS 164.7894 and 11 KAR 20:010 through 20:060 as if the student were enrolled only at the primary institution.

Section 4. The consortium agreement may contain any other terms and conditions, not inconsistent with this administrative regulation, as may be considered necessary or appropriate by the participating educational institutions.

History

RELATES TO: KRS 164.7894
STATUTORY AUTHORITY: KRS 164.744(2), 164.7894
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.744(2) authorizes the authority to provide scholarships. KRS 164.7894(6) requires the authority to promulgate administrative regulations as may be needed for the administration of the program. This administrative regulation sets the conditions for Kentucky Coal County College Completion Scholarship Program eligibility for students simultaneously enrolled in two (2) or more participating educational institutions.
History: 41 Ky.R. 1249; 1509; eff. 2-6-2015; Crt eff. 9-28-2018; Crt eff. 2-28-2025.

Chapter 22 Dual Credit Scholarship Program

11 KAR 22:010 Dual Credit Scholarship Program {#sec-11-kar-22-010 omnilex-key=us-ky-regs-official--title-11--11 KAR 22:010}

Section 1. Definitions.

(1) "Academic term" is defined by KRS 164.786(1)(a).

(2) "Academic year" is defined by KRS 164.786(1)(b).

(3) "Approved dual credit course" is defined by KRS 164.786(1)(c).

(4) "Authority" is defined by KRS 164.786(1)(d).

(5) "Certified high school" means any Kentucky public high school, a high school of a model or practice school under KRS 164.380, and any private, parochial, or church school located in Kentucky that has been certified by the Kentucky Board of Education as voluntarily complying with the curriculum, certification, and textbook standards established by the Kentucky Board of Education under KRS 156.160.

(6) "Dual credit tuition rate ceiling" is defined by KRS 164.786(1)(f).

(7) "Eligible high school student" is defined by KRS 164.786(1)(g).

(8) "Non-certified high school" means any private, parochial, church, or home school located in Kentucky that has not been certified by the Kentucky Board of Education.

(9) "Participating institution" is defined by KRS 164.786(1)(h).

(10) "Priority consideration" means that applications received prior to October 1 in a particular year shall be considered first for scholarship awards within that academic year.

Section 2. Application and Award.

(1) The method by which an application is submitted for an eligible high school student shall be determined by the type of high school in which the student is enrolled.

(a) A certified high school shall submit to the authority a data file in a format specified by the authority that identifies each eligible high school student who is enrolled in an approved dual credit course.

Certified high school file submissions shall be submitted to the authority by September 15 for the fall semester and February 1 for the spring semester of the academic year in which the award is made.
Within two (2) business days of receipt of a data file from a certified high school, the authority shall load the data provided by the high school and create a unique scholarship link on each student's account at kheaa.com.
Each eligible high school student shall then sign in at kheaa.com to access their scholarship application and designate their choice of participating institution and semester for each scholarship award being requested.

(b) An eligible high school student attending a non-certified high school shall submit to the authority a Dual Credit Scholarship Application as required by 11 KAR 4:080, Section 1(10).

(2) To the extent funds are available, the authority shall award scholarships to each eligible high school student and notify the student's participating institution of the award.

(3) The priority consideration deadline for an eligible high school student to submit a scholarship request for the fall semester is October 1. Final requests for both fall and spring semester scholarships shall be submitted no later than March 1 of the academic year in which the award is made.

Section 3. Enrollment Verification.

(1) The participating institution shall verify the eligibility of each student and submit to the authority a complete and accurate enrollment verification record that shall include:

(a) The prefix and number of the approved dual credit course the student is enrolled in;

(b) The number of credit hours of the approved dual credit course;

(c) The per-credit hour cost being charged by the participating institution, not to exceed the dual credit tuition rate ceiling established by the authority; and

(d) The academic year and academic term of the approved dual credit course being reported.

(2) If the approved dual credit course has a required laboratory, the participating institution shall report the laboratory prefix, number, and credit hours in addition to the course information specified in subsection (1) of this section. The cost of the laboratory shall be paid in addition to the approved dual credit course as part of the scholarship award and shall not count against the student's course eligibility limit.

Section 4. Disbursement and Delivery of Funds.

(1) Within thirty (30) days following receipt of the enrollment verification record, scholarship funds shall be disbursed by the authority to the participating institution for subsequent application to the account of the eligible high school student.

(2) The amount disbursed by the authority shall equal the number of credit hours in which the student is enrolled for the approved dual credit course multiplied by the per credit hour cost for each scholarship award, not to exceed the dual credit tuition rate ceiling.

(3) The participating institution shall:

(a) Be responsible for proper disbursement of scholarship funds to each eligible student during the academic term for which each award is intended;

(b) Be liable for disbursement to the wrong individual or to an ineligible student, or for untimely disbursement pursuant to this section; and

(4) Failure of the participating institution to make restitution when required shall, without precluding other remedies, be cause for limitation, suspension, or termination of the participation of the participating institution in accordance with 11 KAR 4:020.

Section 5. Returns.

(1) The participating institution shall return the full scholarship disbursement amount to the authority for any course or laboratory in which enrollment was reported in error or the student was not enrolled.

(2) The participating institution shall not assess any charges to the student if a return of funds to the authority is required.

(3) No later than thirty (30) days after the end of the term in which the student's enrollment was reported in error, the participating institution shall remit to the authority the amount of scholarship funds allocated to be returned.

(4) The participating institution shall notify the authority of the return through the electronic process established for that purpose by the authority. The return information shall include:

(a) The student's name and Social Security number;

(b) The reason for the refund or repayment;

(d) The semester and year for which the award was made; and

(e) The course associated with the return.

Section 6. Reporting.

(1) Within thirty (30) days of the end of each academic term, the participating institution shall submit to the authority the student's final grade for each course for which scholarship funds were received, except that the final grade for an approved dual credit course reported as a yearlong course and disbursed for the fall academic term shall be submitted to the authority within 30 days of the end of the spring academic term.

(2) Reports under this section shall be completed before funds for the next academic term under this program will be disbursed by the authority.

Section 7. Records. A participating institution shall:

(1) Establish an organized system of records pertaining to scholarship recipient eligibility;

(2) Maintain these records for a period of not less than three (3) years after the award year in which the recipient ceased enrollment; and

(3) Upon request, make available to the authority:

(a) All records relied upon by that participating institution to certify that any recipient of funds from the authority is for an eligible student; and

(b) Information necessary to verify that the participating institution has complied with:

KRS 164.786;
11 KAR Chapter 22; and
Representations and requirements contained in its agreement with the authority.

History

RELATES TO: KRS 164.786
STATUTORY AUTHORITY: KRS 164.786(3)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.786(3) requires the Kentucky Higher Education Assistance Authority to administer the Dual Credit Scholarship program and to promulgate administrative regulations needed for administration thereof. This administrative regulation establishes the provisions for administration of this scholarship program, including definitions, applications, awards, disbursements, refunds, and reporting.
History: 48 Ky.R. 2875; 49 Ky.R. 315; eff. 11-1-2022.

Chapter 23 Optometry Scholarship Program

11 KAR 23:010 Optometry Scholarship Program {#sec-11-kar-23-010 omnilex-key=us-ky-regs-official--title-11--11 KAR 23:010}

Section 1. Definitions.

(1) "Academic term" means the fall or spring semester at an eligible institution and does not include summer sessions.

(2) "Academic year" means a period of time that begins July 1 of a calendar year and ends June 30 of the next succeeding calendar year.

(3) "Eligible institution" is defined by KRS 164.7870(2)(b).

(4) "Eligible student" is defined by KRS 164.7870(2)(d).

(5) "Optometry Scholarship Committee" is defined by KRS 164.7870(2)(e).

Section 2. Application and Award.

(1) order for an eligible student to be considered for an award under this program, the student shall submit the following via the online Optometry Scholarship portal at https://www.kheaa.com:

(a) An Optometry Scholarship Application;

(b) Documentation that supports a Kentucky residency determination under 13 KAR 2:045; and

(2) The application period for this program shall be July 1 through December 1 preceding the academic year for which the initial scholarship is awarded.

(3) Once selected as a scholarship recipient, the scholarship award for an eligible student shall be renewed automatically each year without reapplication provided the eligible student maintains continuous enrollment in an approved program at an eligible institution.

(4) The maximum duration of scholarship receipt shall be limited to eight academic terms or completion of the approved program of study, whichever occurs first.

Section 3. Optometry Scholarship Committee and Recipient Selection.

(1) At the close of the application period, the authority shall convene the Optometry Scholarship Committee for the purpose of selecting recipients for the next academic year from the pool of applications submitted by eligible students.

(a) The authority shall recommend to the Committee the number and amount of scholarships to be awarded based on the amount of funds available for the program.

(b) The scholarship recipient selection process shall conclude on or before January 15 of the year preceding the start of academic year in which the scholarship is awarded.

(2) The committee representative from an eligible institution located outside the Commonwealth shall rotate on a two (2) year basis in even numbered years.

Section 4. Recipient Notification and Award Acceptance.

(1) The authority shall notify all applicants of the Optometry Scholarship Committee's award or denial determination on or before January 31 preceding the start of the award year.

(2) Eligible students who are selected to receive a scholarship award shall indicate to the authority which eligible institution they will attend by March 1 preceding the start of the award year.

Section 5. Enrollment Verification. At the start of each academic term, the authority shall provide a roster to each eligible institution to be completed by the institution to verify each eligible student's enrollment in an approved program of study.

Section 6. Disbursement and Delivery of Funds.

(1) Within thirty (30) days following receipt of the enrollment verification record, scholarship funds shall be disbursed by the authority to the eligible institution for subsequent application to the account of the eligible student.

(2) The amount disbursed by the authority for each academic term shall equal one-half of the annual award amount.

(3) The eligible institution shall:

(a) Be responsible for proper disbursement of scholarship funds to each eligible student during the academic term for which each award is intended;

(b) Not make scholarship funds available to the recipient nor apply those funds to the recipient's account after the end of the academic term for which the funds are received by the institution;

(c) Be liable for disbursement to the wrong individual or to an ineligible student, or for untimely disbursement pursuant to this section; and

(d) Make restitution to the authority of any amount improperly disbursed.

(4) Failure of the institution to make restitution when required shall, without precluding other remedies, be cause for limitation, suspension, or termination of the participation of the institution in accordance with 11 KAR 4:020.

Section 7. Refunds and Returns. Refunds by the institution transmitted to the authority shall be accompanied by:

(1) The student's name and birthdate;

(2) The reason for the refund or repayment;

(3) The date of enrollment status change; and

(4) The semester and year.

History

RELATES TO: KRS 164.7870
STATUTORY AUTHORITY: KRS 164.7870(3)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 164.7870(3) requires the Kentucky Higher Education Assistance Authority to administer the Optometry Scholarship program and to promulgate administrative regulations needed for administration thereof. This administrative regulation establishes the provisions for administration of this scholarship program, including definitions, applications, awards, disbursements, refunds, and reporting.
History: 48 Ky.R. 2877; 49 Ky.R. 316; eff. 11-1-2022.