2801.01  NATIONAL DEFENSE/DIRECT STUDENT LOAN (NDSL) 
PROGRAM

The National Defense Student Loan Program was enacted by the National 
Defense Education Act in 1958, Title II (Public Law 85-864, as amended).  This 
program was accepted by the Legislature of the State of California in Chapter 
952 of the statutes of 1959.  It became operative September 18, 1959.  Public Law 
87-344, enacted in October 1961, extended the program for two additional years 
or until June 30, 1968.  Public Law 88-210, enacted in December 1963, further 
extended the program for one additional year, and Public Law 88-665, enacted 
in October 1965, again extended it to June 30, 1972.

The National Direct Student Loan Program became effective July 1, 1972, 
through the enactment of Public Law 92-318, subsequently amended by Public 
Laws 94-482, 96-374, 97-301, and 98-139.

Both of these loan programs were enacted to give assistance to students 
lacking financial resources to attend institutions of higher learning.  These 
long-term, low-interest loans are available, on the basis of financial need, to 
both undergraduate and graduate students to help pay their educational costs.

Each participating institution contributes to the National Defense/Direct 
Student Loan Program an amount equal to one-ninth of the total federal 
capital contribution.

This program is a revolving fund program, which means that the funds 
received from repayments can be reloaned to new students.  The recycling of 
funds will continue until the State or federal government cancels the 
program and/or asks for the return of the funds.

For additional information, refer to the Encyclopedia of Student Financial 
Aid, Section 5.0---NDSL Program.