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(f) Radiation protection. All areas which X-ray, gamma-ray, beta-ray producing and similar equipment is located shall be protected from radiation in accordance with the standards which are in the handbook reports No. 33, 1968; 34, 1970; 35, 1970, and 36, 1970, of the National Council on Radiation Protection and Measurement, Box 4867, Washington, DC 20008.

(g) Earthquake. All facilities shall be designed and constructed in accordance with the standard specified in the Uniform Building Code, 1970, International Conference of Building Officials, 50 South Los Robles, Pasadena, CA 91101, unless more retrictive State and local codes govern.

(h) Zoning. State and local codes shall apply.

Subpart C-Health Professions
Student Loans

AUTHORITY: The provisions of this Subpart C issued under secs. 215, 741, 58 Stat. 690, 80 Stat. 1230; as amended, 42 U.S.C. 216, 294a. SOURCE: The provisions of this Subpart C appear at 33 FR. 15942, Oct. 30, 1968, unless otherwise noted.

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(b) Secretary. The Secretary Health, Education, and Welfare or any other officer or employee of the Department of Health, Education, and Welfare to whom the authority involved may be delegated.

(c) School. A public or other nonprofit school of medicine, dentistry, osteopathy, optometry, podiatry, pharmacy, or veterinary medicine which provides a course of study, or a portion thereof, which leads respectively to a degree of Doctor of Medicine, Doctor of Dental Surgery or an equivalent degree, Doctor of Osteopathy, Doctor of Optometry or an equiv

alent degree, Doctor of Podiatry or an equivalent degree, Bachelor of Science in pharmacy or an equivalent degree, or Doctor of Veterinary Medicine or an equivalent degree, and which is accredited as provided in section 721(b) (1) (B) of the Act.

(d) State. A State or the District of Columbia, Puerto Rico, or the Virgin Islands.

(e) Health Professions Student Loan Fund or Funds. A fund established at a school pursuant to Part C of Title VII of the Act, either with Federal Capital Contributions together with Institutional Capital Contributions, or with Federal Capital Loans. Where a school receives monies from both methods of payment, reference is made to Funds.

(f) Federal Capital Contribution. The capital portion allotted by the Secretary to a school for deposit in a Health Professions Student Loan Fund pursuant to section 742 of the Act.

(g) Institutional Capital Contribution. The money provided by a school, in an amount not less than one-ninth of the Federal Capital Contribution, and deposited in a Health Professions Student Loan Fund.

(h) Federal Capital Loan. A loan made by the Secretary to a school pursuant to section 744 (a) of the Act, the proceeds of which are to be deposited by such school in a Health Professions Student Loan Fund.

(i) Student Loan. The amount of money advanced to a student by a school from a Health Professions Student Loan Fund under a single, properly executed promissory note.

(j) Full-time student. A student who is enrolled in a school and pursuing a course of study which constitutes a fulltime academic workload, as determined by the school, leading to a degree specified in § 57.201(c). A student who pursues a course of study leading to such degree on a part-time basis (less than a full-time academic workload) is not eligible to receive a Health Professions Student Loan.

(k) Ceases to be a full-time student. A student shall be considered to have ceased to be a full-time student upon the first day of the month which is nearest to the date upon which he ceases to be a full-time student as defined herein.

(1) Academic year. The traditional, approximately 9-month September to June annual session. For the purpose of computing academic year equivalents for

students who, during a 12-month period, attend for a longer period than the traditional academic year, the academic year will be considered to be of 9 months' duration.

(m) Fiscal year. The Federal fiscal year commencing on the first day of July and ending on the 30th day of June.

(n) Permanently and totally disabled. The inability to engage in any substantial gainful activity because of medically determinable impairment, which impairment is expected to continue for a long and indefinite period of time, or to result in death.

(0) Uniformed service. The Army, Navy, Air Force, Marine Corps, Coast Guard, Coast and Geodetic Survey, and the Public Health Service.

(p) National of the United States. (1) A citizen of the United States or (2) a person who, though not a citizen of the United States, owes permanent allegiance to the United States (8 U.S.C. 1101(a) (22)).

[33 F.R. 15942, Oct. 30, 1968, as amended at 35 F.R. 182, Jan. 6, 1970]

§ 57.202 Eligibility of schools.

To be eligible for a Federal Capital Contribution or a Federal Capital Loan under this subpart, the applicant school shall:

(a) Meet the applicable requirements of sections 740 (a) and 744(a) of the Act; and

(b) Submit an application as required by § 57.203.

§ 57.203 Application by school.

(a) Each school desiring a Federal Capital Contribution or a Federal Capital Loan under the Act shall submit an application in such form and at such time as the Secretary may require. The application shall be executed by an official authorized to act for the applicant school and to assume on behalf of the applicant school the obligations imposed by the terms and conditions of any Federal Capital Contribution or Federal Capital Loan, including the regulations of this subpart.

(b) Each application shall be reviewed to determine institutional eligibility and the reasonableness of the amount of Federal support requested. When necessary to these ends, the Secretary may require the submission of additional data.

§ 57.204 Agreements for Federal Capital Contributions and Federal Capital Loans.

(a) Federal Capital Contribution Agreements. No application for a Federal Capital Contribution shall be approved unless there is in effect an agreement between the Secretary and the applicant school for Federal Capital Contributions pursuant to section 740 of the Act.

(b) Federal Capital Loan Agreements. No application for a Federal Capital Loan shall be approved unless there is in effect an agreement between the Secretary and the applicant school for Federal Capital Loans containing the terms required by section 744 (b) of the Act and such additional terms and conditions, consistent with the applicable provisions of section 740 of the Act, as the Secretary deems appropriate.

§ 57.205 Allotment and payment of Federal Capital Contributions and Federal Capital Loans.

(a) Annual allotment. At a time determined by him, the Secretary shall make allotments to each school with which he has entered into an agreement pursuant to § 57.204. If the total of the amounts requested for any fiscal year by all schools for Federal Capital Contributions and Federal Capital Loans exceeds the amount of Federal funds determined by the Secretary at the time of such allotment to be available for such purposes for such fiscal year, the allotment to each such school, whether in the form of Federal Capital Contributions or Federal Capital Loans or a combination of both, shall be reduced to whichever of the following is the smaller: (1) The amount requested in the application or (2) an amount which bears the same ratio to the total amount of Federal funds determined by the Secretary at the time of such allotment to be available for such fiscal year for the Health Professions Student Loan Program as the number of full-time students estimated by the Secretary to be enrolled in such school bears to the estimated total number of full-time students in all such schools during such year. Amounts remaining after such allotment shall be reallotted in accordance with subparagraph (2) of this paragraph among schools whose applications requested more than the amounts so allotted to them, but with such adjust

ments as may be necessary to prevent the total allotted to any school from exceeding the total requested by it.

(b) Supplementary allotment from revolving fund only. From funds which become available during any fiscal year for payment to schools from the revolving fund established by section 744 (a) of the Act after the allotments pursuant to paragraph (a) of this section for such fiscal year have been made, the Secretary may, in his discretion and at such time as he shall determine, make supplementary allotments to schools with which he has Federal Capital Loan Agreements and whose requests for funds for such fiscal year exceed the amounts allotted to them pursuant to paragraph (a) of this section. If the total need for supplementary funds exceeds the amounts determined by the Secretary to be available for supplementary allotments, the supplementary allotment to each school shall be reduced to whichever of the following is the smaller: (1) The supplementary amount requested or (2) an amount which bears the same ratio to the amount determined by the Secretary to be available for supplementary allotment as the number of full-time students estimated by the Secretary to be enrolled in such school bears to the estimated total number of full-time students enrolled for such year in all schools which request supplementary allotments. Any amounts remaining after such supplementary allotments may be allotted among schools in such manner as the Secretary determines will best carry out the purposes of the Act.

(c) Payment. The allotment of Federal Capital Contributions and/or Federal Capital Loans to a school shall be paid in such amounts, at such times, and in such installments as will not result in unnecessary accumulation of money in any Health Professions Student Loan Fund.

§ 57.206 Federal Capital Loan Promissory Note.

Each Federal Capital Loan shall be made subject to the terms of a promissory note which shall be executed by an authorized official on behalf of the borrowing school. Each such note shall include such terms with respect to the payment of interest and the repayment of principal as are consistent with the provisions of section 744 of the Act, and shall

include such other terms as the Secretary finds reasonably necessary to protect the financial interests of the United States and to promote the purposes of the Act. § 57.207 Health Professions Student Loan Funds.

(a) Funds established with Federal Capital Contributions. Any fund established by a school with Federal Capital Contributions shall be deposited and carried in a special account of such school. There shall be in such fund at all times monies representing the Institutional Capital Contribution, equal to at least one-ninth of the amount of the balance of the Federal Capital Contributions in such fund.

(1) Except for funds transferred as provided for in subparagraph (2) of this paragraph, such fund shall be used by such school only for (i) loans to students; (ii) capital distribution as provided in section 743 of the Act or as agreed to by the school and the Secretary; and (iii) costs of litigation arising in connection with the collection of an obligation to such fund and interest thereon.

(2) Not to exceed 20 per centum of the amount paid to any such school from the appropriation for any fiscal year for Federal Capital Contributions may be transferred to the sums available to the school for scholarship awards under section 780 of the Act, to be used for the same purpose as such sums: Provided, however, That where the Secretary finds in a particular case that a school has demonstrated an unusual need for scholarship funds, he may approve the transfer of an amount in excess of 20 per centum of the amount so paid. In the case of any transfer pursuant to this subparagraph, the proportionate amount of the Institutional Capital Contribution (i.e., one-ninth of the amount so transferred) may be withdrawn by the school from such fund.

(b) Funds established with Federal Capital Loans. Any fund established by & school with Federal Capital Loans shall be deposited and carried in a special account of such school, and shall be used by such school only for (1) loans to students; (2) repayments of principal and interest on Federal Capital Loans; and (3) costs of litigation arising in connection with the collection of any obligation to such fund and interest thereon. [33 F.R. 15942, Oct. 30, 1968, as amended at 35 F.R. 182, Jan. 6, 1970]

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(a) No eligible applicant shall be denied a student loan on the ground of sex or creed.

(b) Attention is called to the requirements of Title VI of the Civil Rights Act of 1964 (42 U.S.C. 2000d; 78 Stat. 252), which provides that no person in the United States shall, on the ground of race, color, or national origin, be excluded from participation in, be denied the benefits of, or be subjected to discrimination under any program or activity receiving Federal financial assistance. A regulation implementing such title VI, which is applicable to Federal Capital Contributions and Federal Capital Loans made under Part C, Title VII of the Act, has been issued by the Secretary of Health, Education, and Welfare with the approval of the President (45 CFR Part 80).

§ 57.209 Eligibility and selection of student loan recipients.

(a) Eligibility. Student loans from any fund may be made only to students who are:

(1) Nationals of the United States or who are in a State for other than temporary purposes and intend to become permanent residents of the United States;

(2) Enrolled, or accepted for enrollment, in the school as full-time students; and

(3) In need of the amount of the loan to pursue a full-time course of study at the school.

(b) Selection of loan recipients and determination of need. It shall be the responsibility of the school to select qualified applicants and to make reasonable determinations of need. In determining whether a student is in need of a loan to pursue a full-time course of study at the school, the school shall take into consideration:

(1) The financial resources available to the student; and

(2) The costs reasonably necessary for the student's attendance at the school, including any special needs and obligations which directly affect the student's ability to attend the school on a full-time basis.

(c) Records of approval or disapproval. The records of the school shall indicate the basis for approval or disapproval of all or any part of each student application for a loan.

[33 F.R. 15942, Oct. 30, 1968, as amended at 35 F.R. 182, Jan. 6, 1970]

§ 57.210 Maximum amount of student loan.

The total of the loans made from the fund or funds to any student for an academic year may not exceed $2,500. The maximum amount loaned during a 12month period to any student enrolled in a school which provides a course of study longer than the 9-month academic year may be proportionately increased. § 57.211

Evidence of student indebtedness promissory note; security. (a) Evidence of indebtedness-promissory note. Each loan to a student from any fund or funds shall be evidenced by a promissory note, executed by the student borrower in such form as shall be approved by the Secretary.

(1) Any substantive deviations from the promissory note form so approved shall be made only pursuant to approval by the Secretary prior to the making of any loan evidenced thereby, except that a school which elects to require security or endorsement in cases permitted under paragraph (b) of this section may include a provision reflecting such election without prior approval.

(2) With respect to student loans made after June 30, 1969, each promissory note shall include a provision stating that the loan evidenced thereby shall bear interest, on the unpaid balance of such loan, computed only for periods for which the loan is repayable, at the rate of 3 percent per year.

(3) A copy of each executed note shall be supplied by the school to the student maker thereof.

(b) Security. Neither security nor endorsement shall be required except that if the borrower is a minor and if under the applicable State law the note executed by him would not create a binding obligation, then the school is permitted to require security or endorsement. [33 F.R. 15942, Oct. 30, 1968, as amended at 35 F.R. 182, Jan. 6, 1970]

§ 57.212 Payment of student loans.

(a) Loans from any Fund or Funds shall be paid to student borrowers in such installments as are deemed appropriate by the school, except that no borrower may receive more during any given installment period (e.g., semester, term, or quarter) than he needs for such period.

(b) No payment shall be made from any Fund to any student borrower if at the time of such payment such borrower is not a full-time student as defined in § 57.201(j).

§ 57.213

Repayment and collection of student loans.

(a) Repayment of student loans. Subject to the provisions of this paragraph any student loan made after June 30, 1969, including interest accrued thereon, shall be repayable in equal or graduated periodic installments in amounts calculated on the basis of a 10-year repayment period. Except as otherwise provided in this paragraph, repayment shall begin 1 year after the student ceases to be a full-time student.

(1) When a borrower, within such 1-year period, reenters the same or another school as a full-time student, the date upon which interest accrual and the repayment period begin shall be related to and determined by the date on which he last ceases to be a full-time student at any school.

(2) Repayment of the loan shall be suspended, and interest thereon shall not accrue, during (i) all periods of up to a total of 3 years of active duty performed by the borrower as a member of a uniformed service; (ii) all periods of up to a total of 3 years of service as a volunteer under the Peace Corps Act; and (iii) all periods of up to a total of 5 years of advanced professional training. With respect to student loans made before July 1, 1969, all periods up to a total of 5 years of advanced professional training after June 30, 1969, may be excluded from such repayment period where so agreed by the school which made the loan and the Secretary: Provided, That in no such case may the total of the periods of advanced professional training so excluded from the repayment period and the period between the date on which the borrower ceases to be a full-time student and the date on which, under the terms of the promissory note evidencing such loan, the repayment period is to begin, exceed 6 years. For purposes of this subdivision, advanced professional training shall include only (a) internship and residency programs or (b) full-time training beyond the first professional degree of at least 1 academic year which is provided by an accredited institution or an affiliate thereof, and which will advance the borrower's knowledge of and strengthen his skills in the health profession for the study of which he received the loan.

(3) Each student borrower may (subject to the provisions of subparagraph (b) (3) of this section) choose the repay

ment schedule which he prefers from those in use by the school and approved by the Secretary, but a student borrower may, at his option and without penalty, prepay all or part of the principal and accrued interest at any time.

(b) Collection of student loans. (1) Each school at which a fund is established shall exercise due diligence in the collection of all loans due the fund. The school shall use such collection practices as are generally accepted among institutions of higher education and which are at least as extensive and effective as those used in the collection of other student loan accounts due the school.

(2) With respect to any student loan made after June 30, 1969, the school may assess a charge for failure of the borrower to pay all or any part of an installment when it is due, and, in the case of a borrower who is entitled to deferment benefits under section 741(c) of the Act or cancellation benefits under section 741(f) of the Act, for any failure to file timely and satisfactory evidence of such entitlement. The amount of such charge may not exceed $1 for the first month or part of a month by which such installment or evidence is late and $2 for each such month or part of a month thereafter. The school may elect to add the amount of such charge to the principal amount of the loan as of the first day after the day on which such installment or evidence was due, or to make the amount of the charge payable to the school not later than the due date of the next installment after receipt by the borrower of notice of the assessment of the charge.

(3) With respect to any student loan made after June 30, 1969, the school may provide that during the repayment period of a loan, payments of principal and interest by the borrower with respect to all the outstanding loans made to him from any Health Professions Student Loan Fund shall be at a rate equal to not less than $15 per month. [35 F.R. 182, Jan. 6, 1970]

§ 57.214 Provisions for student loan cancellations.

(a) Permanent and total disability. Determinations as to whether or not a student borrower is entitled to a cancellation of indebtedness in accordance with section 741(d) of the Act on the basis of permanent and total disability shall be made by the Secretary on the

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