1. (a) The commission staff shall calculate an institutional rate of default under AS 14.43.120(d)(4) as follows:

   1. (1) the denominator in the calculation is the total principal balance of those loans that began repayment during a specified calendar year and that remained in repayment status for 12 months;
   2. (2) the numerator in the calculation is the total principal balance of those loans, described in (1) of this subsection, that are in default at the end of 12 months in repayment status;
   3. (3) for any cohort year in which the total amount of the education loans made to students to attend an institution is $100,000 or less, the default rate shall be calculated as an average of the rates for that year plus the two previous years.
2. (b) A loan is considered to remain in default if the school or its owner, agent, employee, or other person affiliated with the school makes a payment to prevent default of the loan.
3. (c) Loans awarded under the family education loan program or under the memorial education loan programs are not included in the calculation under (a) of this section.

(Eff. 11/30/95, Register 136; am 12/4/96, Register 140; am 3/23/98, Register 146; am 4/20/2000, Register 154; am 3/1/2002, Register 161)

Authority: AS 14.42.030, AS 14.43.120, AS 14.43.630, AS 14.43.105, AS 14.43.320