ASSEMBLY HIGHER EDUCATION COMMITTEE

STATEMENT TO

SENATE, No. 765

with committee amendments

STATE OF NEW JERSEY

DATED:  DECEMBER 5, 2019

      The Assembly Higher Education Committee reports favorably Senate Bill No. 765 with committee amendments.

      Under current law, the Higher Education Student Assistance Authority (HESAA) may pursue, without a court order, a variety of means to collect on a defaulted student loan made pursuant to the New Jersey College Loans to Assist State Students (NJCLASS) Loan Program. 

      As amended, this bill provides that in the case of an NJCLASS loan in default status, the authority may not refer the borrower to the Department of the Treasury, Division of Taxation for Set-Off of Individual Liability or notify the department and the Division of the State Lottery to withhold a borrower’s lottery winnings, if the authority and the borrower have entered into a settlement agreement.

      The bill also provides that a borrower’s delinquent or default status on an NJCLASS loan may not be used as the basis for the denial, suspension, or revocation of the borrower’s professional or occupational license, certification, or registration.

      As amended and reported by the committee, this bill is identical to Assembly Bill No. 541, which also was amended and reported by the committee on this same date.

COMMITTEE AMENDMENTS:

      The committee amended the bill to:

1. Remove language under the bill that required the Higher Education Student Assistance Authority to obtain a court order prior to pursuing certain collection efforts; 

2. Add language that prohibits HESAA from referring any borrower with a loan in default status to the Department of the Treasury, Division of Taxation for Set-Off of Individual Liability or notify the department and the Division of the State Lottery to withhold a borrower’s lottery winnings if the authority and borrower have entered into a settlement agreement; and

3. Prohibit a borrower’s delinquent or default status on an NJCLASS loan from serving as the basis for the denial, suspension, or revocation of the borrower’s professional or occupational license, certification, or registration.