Higher Education Coordinating Board adopts consolidated loan rules, implements changes to Texas Armed Services scholarship under House Bill 300

The Higher Education Coordinating Board voted to adopt a package of new and amended rules that consolidate student-loan regulations into a new chapter and implement statutory changes for the Texas Armed Services Scholarship program enacted by House Bill 300.

Board staff said the rulemaking moves existing loan-related provisions into a new Chapter 24 to provide clearer guidance on loan servicing and to make it easier to pursue future loan-related rule initiatives. "Creating a separate chapter for our loan operations offers several advantages, including the ability to provide more comprehensive guidance about loan servicing," said Dr. Cantero, a board presenter.

The package includes: updates to rules governing the mental health professional loan repayment assistance program (new section 23.103); new rules for the College Access Loan program (rules 24.4–24.46); rules for a "future occupations and reskilling" forward loan program (rules 24.5–24.59) that add one substantive eligibility change; new rules for converted Texas Armed Services scholarships (rules 24.7–24.74); and amendments to Chapter 22 that implement changes to the Texas Armed Services Scholarship program under House Bill 300.

Board presenters said most of the relocations and clarifying edits are non‑substantive and do not change how programs are administered. A staff presenter noted that a public comment from the Texas Medical Association asking clarifying changes to the definition of "psychiatrist" and to include providers in local mental health authorities was incorporated into the proposed mental health loan repayment rule.

On the future-occupations forward loan, Dr. Quintano said the only substantive change is to explicitly allow regional education service centers and other entities operating alternative educator certification programs to participate. "These entities are already eligible to participate in the college access loan program and given that education is one of the high-demand credentials that qualifies a student for a forward loan, the addition is aligned with the program's goals," Quintano said.

Regarding the Texas Armed Services scholarship and its converted-loan rules, Dr. Cantero said the rules reflect the existing conditional nature of the scholarship and, in response to House Bill 300, add a provision allowing cancellation of a converted loan when a recipient cannot complete required military service because of an exceptional circumstance outside the recipient's control.

Dr. Finchero presented amendments to Chapter 22 that implement five changes made by House Bill 300. Those changes, as described by Finchero, include increasing the maximum scholarship from $15,000 to $30,000 per year with an annual review mechanism tied to cost of attendance; setting a Sept. 30 nomination deadline for legislators with remaining vacancies filled by the lieutenant governor and the speaker of the Texas House; allowing prior ROTC or acceptance into certain officer commissioning programs to satisfy the program's military training requirement for graduate and other students; directing the agency to establish a process to forgive scholarships when recipients cannot meet service requirements because of exceptional circumstances; and limiting scholarship eligibility to four academic years.

A board member asked what qualifies as an "exceptional circumstance" for loan cancellation; a staff presenter said the statute refers to "circumstances outside their control" and that the coordinating board will assess requests under that statutory standard.

All motions to adopt the proposed rules were moved, seconded and approved during the meeting. Several related items were approved on the consent calendar, and the board recessed at the end of the session for a short break.

Votes at a glance

- Adopt proposed amendments/new rules for the mental health professional loan repayment assistance program (new section 23.103): motion moved and seconded; board approved (no roll-call tally recorded in the transcript). The Texas Medical Association public comment was incorporated.

- Adopt new board rules 24.4–24.46 (College Access Loan program): motion moved by Juan Navarre and seconded; approved (no roll-call tally recorded).

- Adopt new board rules 24.5–24.59 (Future Occupations and Reskilling forward loan program): motion moved and seconded; approved. The rules add regional education service centers and entities operating alternative educator certification programs as eligible participants.

- Adopt new board rules 24.7–24.74 (Texas Armed Services scholarship converted to loans): motion moved and seconded; approved. Rules include a cancellation provision for exceptional circumstances as directed by House Bill 300.

- Adopt amendments to rules 22.163 and 22.165–22.17 (Texas Armed Services Scholarship program, implementing House Bill 300): motion moved and seconded; approved. Changes cited by staff include increasing the maximum scholarship to $30,000 per year (with annual review tied to cost of attendance), a Sept. 30 legislative nomination deadline, expanded ways to meet the military training requirement, a process for loan cancellation or scholarship forgiveness for exceptional circumstances, and a four-year eligibility limit.

What this means

Board staff said the reorganization is intended to make loan rules easier to find and to allow clearer rulemaking in the future as the student-loan environment evolves. The HB 300 changes to the Texas Armed Services Scholarship were described as statutory mandates that the board's rule amendments implement, including a newly explicit mechanism for loan cancellation or forgiveness in exceptional cases.

Next steps

Staff indicated they will continue rule implementation and monitoring; specific timelines or additional rulemaking steps were not specified in the meeting record.