An Act to revise criteria for the South Dakota freedom scholarship.

Be it enacted by the Legislature of the State of South Dakota:

Section 1. That § 13-55A-15 be AMENDED:

13-55A-15. The agreement required in section 9 of SL 2021, ch 83, shallmust provide for a governing board. The board shall must consist of five members appointed by the Governor, for a term of five years, except that the initial appointments shall be are for periods of one, two, three, four, and five years. The Governor shall appoint one member as the temporary chair of the board. The board shall elect a chair at its first meeting. A majority of the board shall must be present either personally or by teleconferenceelectronically to constitute a quorum.

The board shall provide eligible South Dakota students, as described in § 13-55A-16, with a needs-based scholarship to attend an eligible postsecondary institution, as described in § 13-55A-17. The distributable income of the South Dakota Freedom Scholarship endowment shall must be expended annually to benefit eligible South Dakota students. Any excess earnings or other income to the endowment shall must be added to the endowment principal. The board shall determine the manner and method of disbursement of the needs-based scholarships, based upon the undergraduate full-time, degree-seeking, South Dakota resident enrollments of each participating, eligible institution, as described in § 13-55A-17.

Section 2. That § 13-55A-16 be AMENDED:

13-55A-16. The board may consider aA student is eligible for a South Dakota Freedom Scholarship, pursuant to § 13-55A-15, if the student:

(1) Is a state resident for at least one year prior to application for the scholarship;

(2) Attends an eligible institution in pursuit of a baccalaureate degree;

(3) Establishes financial need, as determined by the eligible institution and the board described in § 13-55A-15;

(4) Commits, in writing, to live and work in this state for a period of three years after graduation, or following military service or graduate education, if applicable;

(5) Maintains a 2.5 GPA or higher of at least 2.0 while enrolled at an eligible institution; and

(6) Graduates from an eligible institution within five years; and

(7) Agrees, through a promissory note or other agreement, that failure to comply with the provisions of this section shall result results in the scholarship being converted to an interest-bearing loan.

A student is eligible to receive a scholarship under this section for five years. If a student fails to complete a baccalaureate degree within five years from the date of initial attendance, the board may convert any amounts awarded to the student into an interest-bearing loan.

Notwithstanding the provisions of this section, the board may temporarily or permanently waive the requirements of this section if factors, as determined by the board may determine, prevent a student from satisfying the requirements in this section.

Section 3. That § 13-55A-17 be AMENDED:

13-55A-17. For purposes of §§ 13-55A-15 to 13-55A-17, inclusive, an eligible institution is an accredited public or nonpublic nonprofit postsecondary institution, including any tribal college, with a primary physical campus in this state, that:

(1) Elects to participate in the scholarship program provided in §§ 13-55A-15 to 13-55A-17, inclusive; and

(2) Offers a baccalaureate degree; and

(3) Designates an associated nonprofit entity to receive and award scholarship funds to the institution's eligible students, as described in § 13-55A-16, on the eligible institution's behalf.