Bill Text: CT HB05347 | 2014 | General Assembly | Comm Sub

Connecticut House Bill 5347 (Prior Session Legislation)

Bill Title: An Act Allowing Certain Municipalities To Create Scholarship Funds Through Municipal Bonding.

Spectrum: Committee Bill

Status: (Introduced - Dead) 2014-04-08 - Referred by House to Committee on Finance, Revenue and Bonding [HB05347 Detail]

Download: Connecticut-2014-HB05347-Comm_Sub.html


General Assembly		*Raised Bill No. 5347*
*February Session, 2014*		LCO No. 1676
		_____HB05347PD____031314____
Referred to Committee on PLANNING AND DEVELOPMENT
Introduced by:
(PD)

AN ACT ALLOWING CERTAIN MUNICIPALITIES TO CREATE SCHOLARSHIP FUNDS THROUGH MUNICIPAL BONDING.

Be it enacted by the Senate and House of Representatives in General Assembly convened:

Section 1. (NEW) (Effective July 1, 2014) (a) Any distressed municipality, as defined in section 32-9p of the general statutes, may, upon approval by its legislative body or, in any municipality in which the legislative body is a town meeting, by the board of selectmen, adopt an ordinance establishing a scholarship fund. Such ordinance shall include provisions for (1) the establishment of scholarship eligibility requirements, which shall include a requirement that the person seeking the scholarship apply for every appropriate grant and scholarship to offset postsecondary education expenses, enroll in a degree-granting program at an institution of higher education that is accredited by the Board of Governors of Higher Education or regionally accredited, complete at least twelve credit hours per semester and maintain a grade point average of at least 2.5; (2) the establishment of scholarship retention requirements, which may include performance of community service in such municipality; (3) the establishment of a committee to review applications and award scholarships from the fund; (4) the determination of factors to be considered for revocation and reinstatement of a scholarship award; (5) scholarship fund discontinuance; and (6) limitation on the amount of scholarship awards so that no such award shall exceed the annual rate of tuition, room and board and fees charged to in-state students to attend The University of Connecticut at Storrs, as provided in subsection (b) of this section. The provisions of section 7-374 of the general statutes shall apply to any bonds issued pursuant to this section.

(b) A distressed municipality may authorize the issuance of bonds, notes or other obligations in accordance with the provisions of chapter 109 or 588c of the general statutes for the purpose of funding a scholarship fund established pursuant to subsection (a) of this section to provide money for tuition, room and board and fees for residents of the municipality who are United States citizens or permanent residents of the United States to attend a public or independent institution of higher education in this state and who remain residents of such municipality while attending such institution of higher education. Registering to vote in a different municipality while attending an institution of higher education shall not affect eligibility for a scholarship award provided pursuant to this section. As a condition of receiving a scholarship award pursuant to this section, the recipient shall agree to work and live in this state for a certain number of years, as determined by the municipality. If the recipient fails to satisfy such agreement, the ordinance adopted pursuant to subsection (a) of this section may require repayment of all or part of the scholarship award. Any scholarship for tuition, room and board and fees provided pursuant to this section shall be paid directly to the institution of higher education.

(c) The proceeds of bonds, notes or other obligations issued pursuant to this section shall be paid into the fund created pursuant to subsection (a) of this section. The fund may also accept gifts, donations, bequests or funds from any other public or private source.

(d) The budget-making authority of such municipality may, from time to time, direct the town treasurer to invest such portion of such fund as in its opinion is advisable, provided: (1) Not more than forty per cent of the total amount of the fund shall be invested in equity securities, and (2) any portion of such fund not so invested may be invested in (A) bonds or obligations of, or guaranteed by, the state or the United States, or agencies or instrumentalities of the United States, (B) certificates of deposit, commercial paper, savings accounts and bank acceptances, (C) the obligations of any state of the United States or any political subdivision thereof or the obligations of any instrumentality, authority or agency of any state or political subdivision thereof, provided at the time of investment such obligations are rated within the top rating category of any nationally recognized rating service or of any rating service recognized by the Banking Commissioner and applicable to such obligations, (D) the obligations of any regional school district in this state, of any municipality in this state or any metropolitan district in this state, provided at the time of investment such obligations of such government entity are rated within one of the top two rating categories of any nationally recognized rating service or of any rating service recognized by the Banking Commissioner and applicable to such obligations, (E) any fund in which a trustee may invest pursuant to section 36a-353 of the general statutes, (F) investment agreements with financial institutions whose long-term obligations are rated within one of the top two rating categories of any nationally recognized rating service or of any rating service recognized by the Banking Commissioner or whose short-term obligations are rated within the top rating category of any nationally recognized rating service or of any rating service recognized by the Banking Commissioner, or (G) investment agreements fully secured by obligations of, or guaranteed by, the United States or agencies or instrumentalities of the United States.

(e) The town treasurer shall annually submit a complete and detailed report of the condition of such fund to the chief executive officer, the budget-making authority and the legislative body of such municipality and such report shall be made a part of the annual report of the municipality. Such report shall comply with the standard auditing procedures of such municipality.

(f) Such fund may be discontinued after recommendation by the chief executive officer and the budget-making authority to the legislative body and upon approval of such body. To the extent there is any remaining portion of such fund, the fund shall be converted into, or added to, a sinking fund to provide for the retirement of the bonded indebtedness of the municipality. If the municipality has no bonded indebtedness, such fund shall be transferred to the general fund of the municipality.

Sec. 2. (NEW) (Effective July 1, 2014) If a resident who enrolls in a degree-granting program offered by a public institution of higher education receives a scholarship from a fund established by an ordinance pursuant to section 1 of this act, the public institution of higher education shall not reduce any financial aid offered by such institution of higher education to such resident based on such resident's receipt of the scholarship, except when a reduction in financial aid is required by federal law or regulation.