ASSEMBLY EDUCATION COMMITTEE

STATEMENT TO

ASSEMBLY, No. 1119

with committee amendments

STATE OF NEW JERSEY

DATED: MARCH 4, 1996

      The Assembly Education Committee favorably reports Assembly Bill No. 1119 with committee amendments.

      As amended by committee, this bill establishes procedures to ensure that persons who win State lottery prizes in excess of $1,000 and who have failed to make scheduled payments to the Office of Student Assistance on any student loan note held by the Office of Student Assistance will have the proceeds of their lottery winnings automatically applied against the outstanding balance of their defaulted student loan.

      Under the bill's provisions, the Executive Director of the Office of Student Assistance is to forward to the Office of Telecommunications and Information Systems (OTIS), a list of individuals who are in default of student loan repayments. Similarly, the Division of the State Lottery is to provide OTIS with a list of lottery prize winners which shall include the prize winner's name, address, social security number, and amount of the pending prize payment. OTIS is to cross check the two lists and if a match is made to notify the Office of Student Assistance. The Office of Student Assistance will then notify the Division of the State Lottery and provide the division with information on the outstanding amount of the student loan. The Department of the Treasury shall withhold this amount from the pending lottery payment and transmit it to the Office of Student Assistance. If the amount of the outstanding student loan is greater than the lottery payment, the entire amount available shall be transmitted to the Office of Student Assistance.

      The bill also directs the State Treasurer to promulgate regulations necessary to implement the act, which regulations shall provide for prompt notice to any prize winner who may have funds withheld as well as an opportunity for a hearing upon request prior to the disposition of any funds.

      The committee amended the bill to provide that the amount of lottery prize money withheld shall be transmitted to the Office of Student Assistance only after the withholding of any amounts necessary for State or federal income taxes or for such other withholdings that may be required under State or federal law.

      This bill was pre-filed for introduction in the 1996 session pending technical review. As reported, the bill includes the changes required by technical review, which has been performed.