Repayment of loans.

(a) Scholarships extended under subdivisions (1) and (3) of subsection (a) of Section 16-47-78 shall be repaid following graduation either in cash as is provided under subsection (b) or under the terms of a contract to serve in a needy area in Alabama for a term to be specified by the board as provided in subsection (c). Any moneys received from recipients in repayment of a scholarship loan under subsections (b) and (c) shall upon receipt thereof be retained by the Board of Scholarship Awards to be used for funding of future scholarships. The board shall establish a separate fund for these purposes.

(b) Scholarship loans to be repaid under this subsection shall be repaid to the Board of Dental Scholarship Awards in full at an interest rate of six percent per annum from the date of graduation from dental school. Payments are to be made annually, the first of which is due one year after the recipient enters the practice of dentistry or one year after completion of specialty training, whichever occurs first. Repayment in full shall be completed within eight years from initiation of repayment. Any recipient who fails for any reason to continue his or her dental education shall repay all loan amounts in accordance with terms and conditions established by the Board of Dental Scholarship Awards. The interest rate on such unpaid loan amounts shall be fixed at six percent per annum from date of his or her departure or removal from dental school.

(c) Scholarship loans to be repaid under this subsection shall be repaid by service in one of the following ways, subject to approval of the Board of Dental Scholarship Awards:

(1) Practice for a four-year period in a community of less than 5,000 population in which the dentist-population ratio is less than one to 3,000 and the community is at least 30 miles from a city of 50,000 population. This mileage requirement may be waived by the board in its discretion in individual cases.

(2) Practice for a five-year period in a community of more than 5,000 population and less than 15,000 population which has been deemed by the Board of Dental Scholarship Awards to be critically in need of additional dental practitioners.

(3) Practice for a five-year period in a community of more than 15,000 but less than 100,000 population which has been deemed by the Board of Dental Scholarship Awards to be critically in need of additional dental practitioners, and repayment of one half the loan plus six percent interest per annum in five annual payments, beginning at the end of the first year of practice.

(4) Practice for five years in a position in Alabama in public health or as a dentist in a state institution approved by the Board of Dental Scholarship Awards.

(5) For loans of less than four years of study, the annual tuition service repayment may be prorated for each year tuition is received.

(6) Recipients who elect a service-type repayment pursuant to one of the preceding subdivisions (1), (2), (3), or (4) shall make repayment in cash plus six percent interest per annum on a prorated basis as determined by the Board of Dental Scholarship Awards for any portion of this obligation which is not fulfilled.

(d) (1) As a condition of approval by the board of a loan or loans under the Alabama Dental Service Program, each applicant shall enter into a written contract with the board, whereby the applicant shall agree to repay each annual loan received under the program by working, in full-time clinical practice as a licensed dentist in an area of critical need approved by the board, for 18 months, or 15 months if the dentist demonstrated to the board's satisfaction that an average of at least 20 percent of his or her active patients were indigent or covered by Medicaid during that time, or 12 months if the dentist demonstrated to the board's satisfaction that an average of at least 30 percent of his or her active patients were indigent or covered by Medicaid during that time.

An applicant who has signed such a contract with the board may postpone choosing an area of critical need in which to work to a time set by the board.

(2) A participant in the program, subject to approval by the board, may change the area of critical need where he or she will work to repay loans under this program, but in no case shall the participant work in full-time practice for less than four years in the new area of critical need.

(3) An area of critical need shall be an area in Alabama with a critical need, as determined by the board, for dentists, and shall not be a part of, or within five miles of, an urbanized area as defined most recently by the U.S. Census Bureau. The board shall adopt rules under the Administrative Procedure Act to implement this section.

(4) Each dentist repaying loans from the program by working in an area of critical need shall participate in the state Medicaid program.

(Acts 1977, No. 662, p. 1121, §5; Act 2006-301, p. 625, §1; Act 2007-460, p. 962, §1; Act 2016-261, §1.)