A. The governing board of each public institution of higher education may establish unfunded scholarships that are subject to such regulations and conditions as the governing board establishes and the following limitations and restrictions:
1. All such scholarships shall be applied exclusively to the remission, in whole or in part, of tuition and mandatory fees.
2. The governing board shall determine the number of such scholarships annually awarded to undergraduate Virginia students and non-Virginia students.
3. The total value of all such scholarships annually awarded to undergraduate Virginia students shall not exceed the amount of the applicable sum of undergraduate tuition and mandatory fees multiplied by 20 percent of the enrollment of undergraduate Virginia students during the preceding academic year.
4. The total value of all such scholarships annually awarded by an institution to undergraduate non-Virginia students shall not exceed the amount of the applicable per capita out-of-state tuition differential paid by undergraduate non-Virginia students for tuition and mandatory fees multiplied by 20 percent of the enrollment of undergraduate non-Virginia students during the preceding academic year.
5. All such scholarships awarded to undergraduate students shall be awarded only to students in the first four years of undergraduate work and shall be awarded and renewed on a selective basis to students of character and ability who are in need of financial assistance. For purposes of determining need under this section, each governing board shall use a nationally recognized needs-analysis system approved by the Council.
6. The governing board of each public institution of higher education shall determine the number of such scholarships annually awarded to graduate students or teachers serving as clinical faculty pursuant to § 22.1-290.1. The total value of all such scholarships annually awarded to such graduate students and clinical faculty shall not exceed the amount of the sum of graduate tuition and mandatory fees multiplied by the number of teachers serving as clinical faculty pursuant to § 22.1-290.1 and graduate students who are employed as teaching assistants, graduate assistants, or research assistants with significant academic or academic support responsibilities and who are paid a stipend of at least $2,000 in the particular academic year. All unfunded scholarships awarded to graduate students or teachers serving as clinical faculty shall be awarded and renewed on a selective basis to such graduate students and clinical faculty of character and ability.
7. An unfunded scholarship shall entitle the holder to the following award, as appropriate: a. An undergraduate Virginia student may receive an annual remission of an amount not to exceed the cost of tuition and mandatory fees; b. An undergraduate non-Virginia student may receive an annual remission not to exceed the amount of the out-of-state tuition differential required to be paid by the student for tuition and mandatory fees; c. A qualified graduate student may receive an annual remission of an amount not to exceed the cost of tuition and mandatory fees; and d. A teacher serving as clinical faculty may receive an award as determined by the governing board of the institution.
8. Notwithstanding the limitations on the awards of unfunded scholarships to undergraduate students pursuant to subdivision A 7, an institution may award unfunded scholarships to visiting foreign exchange students as long as the number of such awards in any fiscal year does not exceed one quarter of one percent of the total institutional headcount enrollment.
B. No public institution of higher education shall remit any tuition or mandatory fees to any student at such institution except as authorized in this section. Each such institution shall make a report to the Council, upon request, showing the number and value of scholarships awarded under this section according to each student classification.
C. Nothing in this section shall be construed to prevent or limit in any way the admission of state cadets at Virginia Military Institute or to affect the remission of tuition, mandatory fees, or other charges to such state cadets as permitted under existing law.
D. Nothing in this section shall be construed to affect or limit in any way the control of the governing boards of the respective institutions over (i) any other scholarships, (ii) any gifts or donations made to such institutions for scholarships or other special purposes, (iii) any funds provided by the federal government or otherwise for the purpose of career and technical education or vocational rehabilitation in the Commonwealth, or (iv) any funds derived from endowment or appropriations from the federal government for instruction in agriculture and mechanic arts at land-grant universities.
E. Nothing in this section shall be construed to prevent the governing board of any public institution of higher education from fixing a tuition charge for Virginia students reasonably lower than that for non-Virginia students.
F. Nothing in this section or any other provision of law shall prohibit the awarding of 10 full tuition unfunded scholarships each year by Old Dominion University under the terms and conditions provided for in a deed conveying certain property in Norfolk known as the Old Larchmont School made July 5, 1930, between the City of Norfolk and The College of William and Mary in Virginia.
G. Nothing in this section shall be construed to limit other financial aid programs provided pursuant to state law.