Missouri veterinary loan repayment laws

Updated January 2009

340.335. Loan payment program for veterinary graduates--fund created

1. Sections 340.335 to 340.350 establish a loan repayment program for graduates of approved veterinary medical schools who practice in areas of defined need and shall be known as the "Large Animal Veterinary Medicine Loan Repayment Program".

2. The "Large Animal Veterinary Medicine Loan Repayment Program Fund" is hereby created in the state treasury. All funds recovered from an individual pursuant to section 340.347 and all funds generated by loan repayments and penalties received pursuant to section 340.347 shall be credited to the fund. The moneys in the fund shall be used by the department of agriculture to provide loan repayments pursuant to section 340.343 in accordance with sections 340.335 to 340.350.

340.335. Loan payment program for veterinary graduates--fund created

1. Sections 340.335 to 340.350 establish a loan repayment program for graduates of approved veterinary medical schools who practice in areas of defined need and shall be known as the "Large Animal Veterinary Medicine Loan Repayment Program".

2. The "Large Animal Veterinary Medicine Loan Repayment Program Fund" is hereby created in the state treasury. All funds recovered from an individual pursuant to section 340.347 and all funds generated by loan repayments and penalties received pursuant to section 340.347 shall be credited to the fund. The moneys in the fund shall be used by the department of agriculture to provide loan repayments pursuant to section 340.343 in accordance with sections 340.335 to 340.350.

340.337. Definitions

As used in sections 340.335 to 340.405, the following terms shall mean:

(1) "Areas of defined need", areas designated by the department pursuant to section 340.339, when services of a large animal veterinarian are needed to improve the veterinarian-patient ratio in the area, or to contribute professional veterinary services to an area of economic impact;

(2) " College", the college of veterinary medicine at the University of Missouri-Columbia;

(3) "Department", the Missouri department of agriculture;

(4) "Director", director of the Missouri department of agriculture;

(5) "Eligible student", a resident who has been accepted as a full-time student at the University of Missouri-Columbia enrolled in the doctor of veterinary medicine degree program at the college of veterinary medicine;

(6) "Large animal veterinarian", veterinarians licensed pursuant to this chapter, engaged in general or large animal practice as their primary focus of practice, and who have a substantial portion of their practice devoted to large animal veterinary medicine;

(7) "Qualified applicant", an eligible student approved by the department for participation in the large animal veterinary student loan program established by sections 340.375 to 340.405;

(8) "Qualified employment", employment as a large animal veterinarian and where a substantial portion of business involves the treatment of large animals on a full-time basis in Missouri located in an area of need as determined by the department of agriculture. Qualified employment shall not include employment with a large-scale agribusiness enterprise, corporation, or entity. Any forgiveness of such principal and interest for any qualified applicant engaged in qualified employment on a less than full-time basis may be prorated to reflect the amounts provided in this section;

(9) "Resident", any person who has lived in this state for one or more years for any purpose other than the attending of an educational institution located within this state.

340.339. Designation as area of defined need

The department shall designate counties, communities or sections of rural areas as areas of defined need as determined by the department by rule.

340.341. Rules and regulations

1. The department shall adopt and promulgate rules establishing standards for determining eligible persons for loan repayment pursuant to sections 340.335 to 340.350. Such standards shall include, but are not limited to the following:

(1) Citizenship or permanent residency in the United States;

(2) Residence in the state of Missouri;

(3) Enrollment as a full-time veterinary medical student in the final year of a course of study offered by an approved educational institution in Missouri;

(4) Application for loan repayment.

2. The department shall not grant repayment for more than six veterinarians each year.

340.343. Contract for repayment of educational loans; provisions

1. The department shall enter into a contract with each individual qualifying for repayment of educational loans. The written contract between the department and an individual shall contain, but not be limited to, the following:

(1) An agreement that the state agrees to pay on behalf of the individual, loans in accordance with section 340.345 and the individual agrees to serve for a time period equal to four years, or such longer period as the individual may agree to, in an area of defined need, such service period to begin within one year of graduation by the individual with a degree of doctor of veterinary medicine;

(2) A provision that any financial obligations arising out of a contract entered into and any obligation of the individual which is conditioned thereon is contingent upon funds being appropriated for loan repayments;

(3) The area of defined need where the person will practice;

(4) A statement of the damages to which the state is entitled for the individual's breach of the contract;

(5) Such other statements of the rights and liabilities of the department and of the individual not inconsistent with sections 340.335 to 340.350.

2. The department may stipulate specific practice sites contingent upon department-generated large animal veterinarian need priorities where applicants shall agree to practice for the duration of their participation in the program.

340.345. Loan repayment program requirements; department contribution; repayment schedule

1. A loan payment provided for an individual pursuant to a written contract under the large animal veterinary medicine loan repayment program shall consist of payment on behalf of the individual of the principal, interest and related expenses on government and commercial loans received by the individual for tuition, fees, books, laboratory and living expenses incurred by the individual.

2. For each year of obligated services that an individual contracts to serve in an area of defined need, the department may pay up to twenty thousand dollars on behalf of the individual for loans described in subsection 1 of this section.

3. The department may enter into an agreement with the holder of the loans for which repayments are made under the large animal veterinary medicine loan repayment program to establish a schedule for the making of such payments if the establishment of such a schedule would result in reducing the costs to the state.

4. Any qualifying communities providing a portion of a loan repayment shall be considered first for placement.

340.347. Repayment

1. An individual who has entered into a written contract with the department or an individual who is enrolled at the college and fails to maintain an acceptable level of academic standing or voluntarily terminates such enrollment or is dismissed before completion of such course of study or fails to become licensed pursuant to this chapter within one year after graduation shall be liable to the state for the amount which has been paid on such individual's behalf pursuant to the contract.

2. If an individual breaches the written contract of the individual by failing either to begin such individual's service obligation or to complete such service obligation, the state shall be entitled to recover from the individual an amount equal to the sum of:

(1) The total of the amounts paid by the state on behalf of the individual, including interest; and

(2) An amount equal to the unserved obligation penalty, which is the total number of months of obligated service which were not completed by an individual, multiplied by five hundred dollars.

3. The department may act on behalf of a qualified community to recover from an individual described in subsections 1 and 2 of this section the portion of a loan repayment paid by such community for such individual.

340.350. Effectiveness provision

No rule or portion of a rule promulgated pursuant to the authority of sections 340.335 to 340.350 shall become effective unless it has been promulgated pursuant to the provisions of chapter 536, RSMo.

Large Animal Veterinary Student Loan Program

340.375. Program implementation--advisory panel, members--rules and regulations

1. The department of agriculture shall implement and administer the large animal veterinary student loan program established under sections 340.375 to 340.405, and the large animal veterinary medicine loan repayment program established under sections 340.335 to 340.350.

2. An advisory panel of not more than five members shall be appointed by the director. The panel shall consist of three licensed large animal veterinarians, the dean of the college or his or her designee, and one public member from the agricultural sector. The panel shall make recommendations to the director on the content of any rules, regulations or guidelines under sections 340.335 to 340.405 prior to their promulgation. The panel may make recommendations to the director regarding fund allocations for loans and loan repayment based on current veterinarian shortage needs.

3. The department of agriculture shall promulgate reasonable rules and regulations for the administration of sections 340.375 to 340.405, including but not limited to rules for disbursements and repayment of loans. It shall prescribe the form, the time and method of filing applications and supervise the proceedings thereof. Any rule or portion of a rule, as that term is defined in section 536.010, RSMo, that is created under the authority delegated in this section shall become effective only if it complies with and is subject to all of the provisions of chapter 536, RSMo, and, if applicable, section 536.028, RSMo. This section and chapter 536, RSMo, are nonseverable and if any of the powers vested with the general assembly pursuant to chapter 536, RSMo, to review, to delay the effective date, or to disapprove and annul a rule are subsequently held unconstitutional, then the grant of rulemaking authority and any rule proposed or adopted after August 28, 2007, shall be invalid and void.

340.381. Veterinary student loan payment fund created, use of funds

There is hereby created in the state treasury the "Veterinary Student Loan Payment Fund", which shall consist of general revenue appropriated to the large animal veterinary student loan program, voluntary contributions to support or match program activities, money collected under section 340.396, and funds received from the federal government. The state treasurer shall be custodian of the fund and shall approve disbursements from the fund in accordance with sections 30.170 and 30.180, RSMo. Upon appropriation, money in the fund shall be used solely for the administration of sections 340.375 to 340.405. Notwithstanding the provisions of section 33.080, RSMo, to the contrary, any moneys remaining in the fund at the end of the biennium shall not revert to the credit of the general revenue fund. The state treasurer shall invest moneys in the fund in the same manner as other funds are invested. Any interest and moneys earned on such investments shall be credited to the fund.

340.384. Contract for repayment

The department of agriculture shall enter into a contract with each qualified applicant receiving financial assistance under the provisions of sections 340.375 to 340.405 for repayment of the principal and interest.

340.387. Application for financial assistance--contingent upon college acceptance

Eligible students may apply to the department for financial assistance under the provisions of sections 340.375 to 340.405. If, at the time of application for a loan, a student has formally applied for acceptance at the college, receipt of financial assistance is contingent upon acceptance and continued enrollment at the college. A qualified applicant may receive financial assistance for each academic year he or she remains a student in good standing at the college.

340.390. Awarding of loans, amount, priority

Up to six qualified applicants per academic year may be awarded loans of up to eighty thousand dollars per applicant under the provisions of sections 340.375 to 340.405. Priority for loans shall be given to eligible students who have established financial need. All financial assistance shall be made from funds credited to the veterinary student loan payment fund.

340.393. Schedules for repayment--interest, amount--interest and principal forgiven through qualified employment

The department shall establish schedules for repayment of the principal and interest on any financial assistance made under the provisions of sections 340.375 to 340.405. Interest at the rate of nine and one-half percent per annum shall be charged on all financial assistance made under the provisions of sections 340.375 to 340.405, but the interest and principal of the total financial assistance granted to a qualified applicant at the time of the successful completion of a doctor of veterinary medicine degree program shall be forgiven through qualified employment.

340.396. Repayment, begins when--recipients who cease study before completion of degree or graduation

The financial assistance recipient shall repay the financial assistance principal and interest beginning not more than one year after completion of the degree for which the financial assistance was made in accordance with the repayment contract. If an eligible student ceases his or her study prior to successful completion of a degree or graduation from the college, interest at the rate specified in section 340.393 shall be charged on the amount of financial assistance received from the state under the provisions of sections 340.375 to 340.405, and repayment, in accordance with the repayment contract, shall begin within ninety days of the date the financial aid recipient ceased to be an eligible student. All funds repaid by recipients of financial assistance to the department shall be deposited in the veterinary student loan payment fund for use pursuant to sections 340. 375 to 340.405.

340.399. Deferral of payments, when, review

The department shall grant a deferral of interest and principal payments to a financial assistance recipient who is pursuing a post-degree training program, or upon special conditions established by the department. The deferral shall not exceed four years. The status of each deferral shall be reviewed annually by the department to ensure compliance with the intent of this section.

340.402. Actions to recover amount due

When necessary to protect the interest of the state in any financial assistance transaction under sections 340.375 to 340.405, the department may institute any action to recover any amount due.

340.405. Department not obligated to enter into contracts--availability of funds--expiration

1. Sections 340.375 to 340.405 shall not be construed to require the department to enter into contracts with individuals who qualify for education loans or loan repayment programs when federal, state and local funds are not available for such purposes.

2. Sections 340.375 to 340.405 shall not be subject to the provisions of sections 23.250 to 23.298, RSMo.

3. Sections 340.375 to 340.405 shall expire on June 30, 2013.

2 CSR 30-11.010 Large Animal Veterinary Student Loan Program
(1) The following definitions shall be used in the interpretation and enforcement of this rule, in addition to those found in section 340.337, RSMo:
(A) Academic year means the period of time beginning with the start of the fall semester to the final day of the spring semester and any subsequent summer sessions;
(B) Advisory panel means individuals appointed by the director of the Missouri Department of Agriculture to advise the department regarding the rules, funding, and guidelines for implementing and administering the large animal student medicine loan;
(C) Application contract means the form provided by the Missouri Department of Agriculture for the purpose of applying for a large animal veterinary student loan;
(D) Area of defined need means a geographic area within Missouri with at least one (1) of the following characteristics and approved by the director or the director's designated agent:
1. Large animal populations/producers sufficient to potentially sustain/employ a large animal veterinarian;
2. Employment opportunity as a large animal veterinarian;
3. Veterinary population in region is diminishing;
4. Economics of area adequate to support veterinarian;
5. Presence of livestock markets; and
6. Requests from individual, groups, organizations, and communities;
(E) Educational loans means the financial assistance provided by the department under the authority of the large animal veterinary student loan program; commercial loans made by banks, credit unions, savings and loan associations, insurance companies, schools, and other financial institutions for veterinary education purposes; or loans made by federal, state, county, or city agencies authorized by law to make loans for veterinary education purposes;
(F) Eligible applicant means a veterinary student in the college or in the final full year as a full-time student in an undergraduate course of study eligible to apply to the college;
(G) Eligible student means a resident who has made application to be a full-time student or currently enrolled in the college;
(H) Loan contract means the form signed by a large animal veterinary student loan applicant and the director of the department or the director's authorized agent in which the applicant agrees to accept responsibility for repayment of educational loans through qualified employment or by cash;
(I) Placement form means the form provided by the department for the purpose of applying for participation in the large animal veterinary student loan program;
(J) Qualified applicant means a student matriculating in the college and in the professional program leading to a doctor of veterinary medicine degree;
(K) Reasonable educational costs means tuition, books, fees, supplies, equipment, and materials required by the college in which the loan program recipient is enrolled to obtain a doctorate of veterinary medicine; and
(L) Reasonable living expenses means the cost of room, board, transportation, and miscellaneous costs based on individual program costs.
(2) Recipients of large animal veterinary student loans shall verify to the department their enrollment, their program eligibility, their academic standing within thirty (30) days following the completion of each semester and summer session, and their expected program completion date.
(A) Applicant is responsible to provide information to the department.
(B) The advisory panel shall determine the consequences of the applicant's failure to comply with the requirement of subsection (2)(A).
(C) Interest on funds loaned by the large animal veterinary student loan program shall accrue at a rate determined by the advisory panel from the issue date of the department check.
(D) If a recipient of financial assistance ceases his/her study prior to the successful completion of the course of instruction required for graduation from the college, repayment of the principal and interest shall begin within ninety (90) days after the date the recipient ceases to be an eligible student, in accordance with the repayment contract. The department shall be notified by the loan recipient within thirty (30) days of the date the recipient ceases to be an eligible student. Payment shall be completed no more than twelve (12) months from that date.
(3) Section 340.390, RSMo, provides that the department may grant a limited deferral of repayment of the principal and interest to a qualified student attending the college.
(A) The department may grant a limited deferral of the repayment of the principal and interest when the deferral would best serve the interest of the state and the large animal student veterinary loan program.
(B) The status of each deferral may be reviewed as often as necessary by the department, but the department shall review each deferral annually to insure compliance with the intent of the deferral. The length of deferral may not exceed four (4) years.
(C) Interest accrued during a deferral period by a financial assistance recipient shall be forgiven on the same basis as the original loan and interest.
(4) To qualify for a large animal veterinary student loan, the applicant shall have no conflicting service obligation that would prevent the state from benefitting from the applicant's services after graduation, with the exception of service in the National Guard or military reserve.
(5) Application contracts shall be completed, signed by the applicant, and submitted to the department between August 15 and September 15 or at another time directed by the department.
(A) Application contracts shall be accompanied by proof of Missouri residency, such as a copy of the Missouri individual income tax return for the previous year of the applicant or of the applicant's parents or legal guardian if applicant is listed as a legal dependant on the parent's or legal guardian's return.
(B) Applications shall include an essay which describes the applicant's professional ambition and how those professional goals fit with the intent of the large animal veterinary student loan program (eight hundred (800)-word maximum), three (3) reference letters, and complete set of transcripts from any college courses taken.
(C) Loan recipients shall apply annually.
(D) Only application contract forms for the large animal veterinary loan program supplied by the department will be accepted.
(E) Upon approval for funding, the loan contract shall be signed by the department director or the director's authorized agent and shall become the agreement of the applicant to accept responsibility for repayment either by cash or by service in an area of defined need.
(F) A copy of an applicant's financial aid award notice from the college and of the applicant's notice of acceptance by the college shall be on file in the department prior to funding by the large animal veterinary loan program.
(6) Selection criteria for the large animal veterinary student loan program are-
(A) Eligibility of the applicant;
(B) Demonstrated financial need;
(C) Qualification and potential based upon submitted materials;
(D) Willingness to serve in designated area of need; and
(E) Information presented at a personal interview if one is requested of the applicant by the committee.
(7) Subject to availability of federal, state, or community funds for the large animal veterinary student loan program, the department shall enter into a maximum four (4)-year contract with each individual qualifying for repayment of educational loans.
(8) Participants who default on their written loan contracts shall be subject to monetary repayment of the contracted amount and interest. Cash repayment periods may be authorized up to a maximum of twelve (12) consecutive months.
(A) The department may grant a deferral of payment of the loan amount and interest at the discretion of the director on the basis of hardship such as critical illness of participant or an immediate family member, death in the immediate family, or severe handicapping condition of the participant when that hardship has been adequately documented such as statement of the attending physician, death certificate, or Social Security disability determination.
(B) The status of each deferral may be reviewed as often as necessary by the department but shall be reviewed annually to insure compliance with the intent of the deferral.
(C) Once a loan participant has begun qualified employment, repayment of the loan shall continue, even if the designation of the area of defined need of qualified employment changes, as long as the loan participant does not terminate employment.
(D) If circumstances beyond the control of a loan participant result in the termination of qualified employment, deferral status may be granted for a period up to ninety (90) days to allow the participant to gain employment in an area of defined need, upon approval by the director or the director's designated agent.
(E) Upon authorization of the director or authorized agent, forgiveness of interest and principal for a financial assistance recipient engaged in qualified employment on a less than full-time basis may be granted on a prorated basis.
(9) A graduate of the student loan program must-
(A) Complete the Large Animal Veterinary Student Loan Program Placement Form prior to May 1 of the current year; and
(B) Notify the department of any change of address or employment within thirty (30) days.
(10) Members of the advisory panel shall serve for three (3) years from the date of appointment by the director and may be reappointed for consecutive three (3)-year terms. Resignations from the panel may be accepted by the director at any time. Appointments to fill vacated panel positions shall be for three (3) years. Nonattendance by a panel member at two (2) consecutive scheduled panel meetings shall constitute a resignation from the panel unless a written explanation of the absences with a written request to continue service on the panel is received by the director within thirty (30) days after the second absence of a panel member from a scheduled panel meeting.
Nonattendance at more than four (4) scheduled panel meetings in any two (2) consecutive years may constitute, at the discretion of the director, a resignation from the panel.

Source: AVMA Staff Research, State Legislative and Regulatory Affairs Dept.
Contact: Tara Southwell, State Policy Analyst, AVMA State Legislative and Regulatory Department, 847-285-6779