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CHESLA seeks to widen Alliance District loan subsidy to more high‑priority occupations
Summary
CHESLA told the committee SB 1261 would expand an existing Alliance District loan‑refinance subsidy to additional high‑priority occupations and reallocate part of existing bond funds; witnesses said the program started with $7 million, has dispersed about $1.7 million so far, and requires beneficiaries to remain employed in an Alliance District.
Jeanette Weldon, executive director of the Connecticut Higher Education Supplemental Loan Authority (CHESLA), testified in support of SB 1261, which would broaden the Alliance District Loan Subsidy Program to include additional high‑priority occupations determined in consultation with the State Department of Education.
Weldon said CHESLA is a quasi‑public, self‑supporting authority and described the program as a student‑loan refinance mechanism that offers subsidized rates to employees (for example, teachers, paraeducators and school counselors) who stay in designated Alliance Districts. She and Josh Herlock, deputy director, told the committee that CHESLA initially received $7 million in state dollars for the Alliance District program and has dispersed about $1.7 million to date; they said much of the original allotment remains in an interest‑bearing account and could be allocated to a statewide high‑priority occupation subsidy program.
Committee members asked how eligibility is determined and whether the program obligates recipients to remain in an Alliance District. CHESLA staff confirmed recipients must work in a qualifying Alliance District position; CHESLA verifies employment several times a year and removes the subsidized rate if a recipient leaves the designated employment, increasing the loan’s interest rate. Witnesses said the bill’s expansion language is intended to permit the Department of Education in consultation with CHESLA to identify additional high‑priority occupations (for example, school psychologists or nurses) for Alliance Districts and to mirror that approach statewide.
Lawmakers also discussed outreach: CHESLA staff said they have conducted regular outreach to HR and chief talent offices in Alliance Districts and that 24 of 36 Alliance Districts have used the program to date. Committee members asked whether technical schools and CTE centers could be included; CHESLA said the expansion language may allow for broader eligibility but recommended working with the Department of Education on precise definitions.
The bill had strong support from some educational and labor witnesses in the hearing but the committee sought clarifying language on employer definitions and coverage to ensure the subsidy reaches schools and positions with demonstrated shortages.
