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A4418
ASSEMBLY, No. 4418
STATE OF NEW JERSEY
222nd LEGISLATURE
�
INTRODUCED FEBRUARY 19, 2026
Sponsored by:
Assemblyman� JAY WEBBER
District 26 (Morris and Passaic)
SYNOPSIS
���� �Education Investment Act�; establishes an equity
financing for education program at certain public institutions of higher
education.
CURRENT VERSION OF TEXT
���� As introduced.
��
An Act
establishing an equity financing for education program
and supplementing Title 18A of the New Jersey Statutes.�
����
Be It
Enacted
by the Senate and General Assembly of
the State of New Jersey:
���� 1.��� This act shall be known
and may be cited as the �Education Investment Act.�
���� 2.��� a.� The Commission on
Higher Education shall select one or more public institutions of higher
education to participate in an equity financing for education program.� The
purpose of the program shall be to provide a student enrolled in an
undergraduate or graduate course of study at a participating institution of
higher education with an income-contingent option for financing his education.�
Under the program, a student may defer payment of all or a portion of
undergraduate or graduate tuition costs and other expenses covered by the
program until the completion of his education.� At some time following the
completion of his education, the student shall pay a fixed percentage of his
income to the participating institution over a fixed number of years.� The full
payment by the student may be more, less, or the same as the deferred expenses
he incurred during his education.
���� b.��� A participating
institution shall permit any student enrolled in an undergraduate or graduate
course of study to apply for a deferment and repayment contract through the
equity financing for education program.� The participating institution may
limit enrollment in the program, consistent with prudent management of the
program�s costs.
���� c.���� The participating
institution shall establish the terms and� conditions of the deferment and
repayment contract.� The contents of the contract may be established with any
third party investors and shall include, but not be limited to, the following:
���� (1)�� the percentage of a
participating student�s future income that shall be collected as repayment for
his undergraduate or graduate expenses covered by the program;�
���� (2)�� the length of the
repayment period;
���� (3)�� the terms and conditions
under which the student�s payments may be temporarily deferred, permanently
cancelled, or repaid in a lump sum;
���� (4)�� a description of the
reporting and repayment procedure; and
���� (5)�� provisions for late
payment charges and for default.
���� d.��� A participating
institution shall bear the costs of the equity financing for education program
during the deferment period.� The institution may enter into an agreement or
contract with one or more third party investors to cover such costs in exchange
for a share of future repayments received through the program.
���� 3.��� This act shall take
effect immediately.
STATEMENT
���� This bill is entitled the
�Education Investment Act.�� The bill establishes an equity financing for
education program at one or more public institutions of higher education, to be
selected by the Commission on Higher Education.� The purpose of the program is
to provide undergraduate and graduate students at participating institutions of
higher education with an income-contingent option for financing their
education.� Under the program, a student may defer payment of all or a portion
of undergraduate or graduate tuition costs and other expenses covered by the
program until the completion of his education.� At some time following the
completion of his education, the participating student must pay a fixed
percentage of his income to the participating institution over a fixed number
of years.
���� Under the bill, a
participating institution must permit any student enrolled in an undergraduate
or graduate course of study to apply for a deferment and repayment contract
through the equity financing for education program.� The participating
institution may limit enrollment in the program, consistent with prudent
management of the program�s costs.�
���� The terms and conditions of
the deferment and repayment contract will be set by the participating
institution, but may be established in consultation with third party investors,
and must specify, at a minimum, the following:
���� (1)�� the percentage of a
participating student�s future income that will be collected as repayment for
his undergraduate or graduate expenses covered by the program;�
���� (2)�� the length of the
repayment period;
���� (3)�� the terms and conditions
under which a contract may be temporarily deferred, permanently cancelled, or
repaid in a lump sum;
���� (4)�� a description of the
reporting and repayment procedure; and
���� (5)�� provisions for late
payment charges and for default.
���� The bill provides that the
participating institution will bear the costs of the equity financing for
education program during the deferment period.� However, the institution may
enter into an agreement or contract with one or more third party investors to
cover such costs in exchange for a share of future repayments received through
the program.
���� The current system for
financing higher education, which results in large amounts of debt paid back at
a fixed interest rate, presents a significant burden to recent graduates. �It
is the sponsor�s belief that because students face fixed debt payments after
graduation, they are discouraged from pursuing low-paying work in public
service. �An alternative method of student loan financing based on equity,
however, would relieve the burden of debt and encourage students to pursue
careers that match their interests and skills without regard to potential
income. �At the same time, such a system would also present a powerful incentive
to the institution of higher education to provide effective career services
both during and after a student's course of study.