Signed Legislation That Will Avert Disruption
Governor Takes Final Step in Safeguarding Student Loans
Governor Sarah Palin has signed legislation that will avert a disruption in new education loans originated by the Alaska Student Loan Corporation (ASLC). The corporation has financed its education loan program by issuing tax-exempt revenue bonds in the capital market. ASLC has been unable to issue bonds due to the catastrophic capital market.
"This bill ensures Alaska's students will not be left out in the cold despite the current economic downturn," Governor Palin said. "Without this legislation, no Alaska student loans could be made this fall."
House Bill 172, sponsored by the governor, enables the Commissioner of Revenue to provide a bridge loan and directly invest in the corporation's education loans. HB 172 also creates a credit enhancement facility to assist ASLC in the issuance of bonds during the current economic crisis when, without this facility, it would be uneconomical to issue bonds.
ASLC's largest education programs are AlaskAdvantage Stafford Loans and AlaskAdvantage Supplemental Loans. This year, more than 8,100 Alaska students relied on one or both of these low-cost education loan programs to aid in financing their postsecondary education and training program.