FOR AN ACT ENTITLED, An Act to  establish the regents scholarship program and provide for its funding.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF SOUTH DAKOTA:
     Section  1.  That chapter 13-55 be amended by adding thereto a NEW SECTION to read as follows:

     There is established the regents scholarship program to be administered by the Board of Regents. The Board of Regents may establish such policies and procedures as it deems necessary to carry out the purposes of this program. The purpose of the program is to allow South Dakota's most academically accomplished high school graduates to receive an affordable education at one of South Dakota's public universities or technical schools.
     Section  2.  In order to be eligible for a regents scholarship award, a student shall:

             (1)    Be a resident of South Dakota at the time of graduation from high school;

             (2)    Meet the high school graduation requirements as provided in Board of Regents Policy 2:3.2.F as in effect on January 25, 2001;

             (3)    Attend one of the six Board of Regents universities or four state technical institutes;

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             (4)    Have obtained a high school cumulative grade point average of at least 3.0 on a 4.0 scale, or the equivalent, through the junior year of high school, with no final grade below a "C";

             (5)    Enter into the program within one year of graduation from high school.

     A student is eligible to participate in the regents scholarship program for the equivalent of four academic years or until the attainment of a baccalaureate or technical degree, whichever comes first.
     Section  3.  Scholarship payments shall be made on a semester-by-semester basis. The amount of award shall be as follows:

             (1)    One thousand five hundred dollars for the first year of attendance;

             (2)    Two thousand dollars for the second year of attendance;

             (3)    Two thousand five hundred dollars for the third year of attendance;

             (4)    Three thousand dollars for the fourth year of attendance.

     The total amount of the scholarship may not exceed nine thousand dollars.
     Section  4.  In order to maintain eligibility, a student shall:

             (1)    Maintain a cumulative 3.0 grade point average on a 4.0 scale. Cumulative grade point average shall be calculated after the second semester and every semester thereafter. The student shall complete consecutive spring and fall terms in order to remain eligible for continuation of the scholarship program from term to term. Once a student's cumulative grade point average falls below 3.0 on a 4.0 scale, the student permanently loses eligibility for continuation in the scholarship program;

             (2)    Complete fifteen credit hours of instruction per semester. The student must enroll in and complete at least fifteen credit hours of instruction in each consecutive spring and fall term. If the executive director of the Board of Regents determines that a student's

failure to enroll or to maintain continued enrollment occurred as a direct result of legitimate factors outside the student's control, or has resulted from the student's participation in an activity that in the executive director's judgment provides knowledge or experience that will enhance the student's academic pursuits, the executive director may extend the student's eligibility to participate in the program for up to two additional years, if the student does not enroll in a noneligible institution;

             (3)    Sit for and pass the college proficiency exam as required by Board of Regents Policy 2.28 as in effect on October 6, 2000, at the end of the sophomore year. If the student fails to pass the proficiency exam the first time, eligibility is forfeited for continuation in the scholarship program;

             (4)    All eligible students shall certify not to use tobacco products for the entire term in which they will be participating in the regents scholarship. Failure to comply shall result in loss of eligibility.
     Section  5.  That § 10-50B-11 be amended to read as follows:
     10-50B-11.   The people's trust fund is established in the state treasury. Any money received from the Master Settlement Agreement signed on November 23, 1998, by attorneys general from several states and various tobacco companies shall be deposited in the people's trust fund. The principal in the trust fund may not be expended , except for dollars appropriated by the Legislature for the regents scholarship program . The fund shall be invested according to § §  4-5-23 and 4-5-26. Interest earned on money in the fund shall be deposited in the people's interest fund created in §  10-50B-12.