(A) The Palmetto Fellows Scholarship Program is established to foster scholarship among the state’s post-secondary students and retain outstanding South Carolina high school graduates in the State through awards based on scholarship and achievement. Measures must be taken to ensure equitable minority participation in this program. Recipients of these scholarships are designated Palmetto Fellows. Each Palmetto Fellow shall receive a scholarship in an amount not to exceed six thousand seven hundred dollars. These scholarships in combination with all other grants and scholarships shall not exceed the cost of attendance at the institution attended. The commission shall promulgate regulations and establish procedures to administer the program and request annual state appropriations for the program.

(B) Students, either new or continuing, must not have been adjudicated delinquent or been convicted or pled guilty or nolo contendere to any felonies or any second or subsequent alcohol or drug-related offenses under the laws of this or any other state or under the laws of the United States in order to be eligible for a Palmetto Fellows Scholarship, except that a high school or college student otherwise qualified who has been adjudicated delinquent or has been convicted or pled guilty or nolo contendere to a second or subsequent alcohol or drug-related misdemeanor offense nevertheless shall be eligible or continue to be eligible for such scholarships after the expiration of one academic year from the date of the adjudication, conviction, or plea.

(C) Of the funds made available for higher education Palmetto Fellows Scholarships for any year, a percentage thereof must be allocated for students attending South Carolina independent colleges of higher learning in this State. This percentage must be equivalent to the percentage of the independent colleges’ share of the total South Carolina resident undergraduate full-time enrollment (FTE) of all public and independent higher education institutions in South Carolina based on the previous year’s data as determined by the Commission on Higher Education and the South Carolina Tuition Grants Commission.

(D) After expending funds appropriated for Palmetto Fellows Scholarships from all other sources, there is automatically appropriated from the general fund of the State whatever amount is necessary to provide Palmetto Fellows Scholarships to all persons meeting the requirements of this section.

(E) A Palmetto Fellows Scholarship is available to an eligible resident student who attends or will attend an eligible public or independent institution.

(F) For purposes of subsection (E):

(1) "Public or independent institution" means a:

(a) South Carolina public institution defined in § 59-103-5, and an independent institution as defined in § 59-113-50; or

(b) public or independent bachelor’s level institution chartered before 1962 whose major campus and headquarters are located within South Carolina.

(2) "Resident student" means a:

(a) student who is either a member of a class graduating from a high school located in this State, a home school student who has successfully completed a high school home school program in this State in the manner required by law, or a student graduating from a preparatory high school outside this State, while a dependent of a parent or guardian who is a legal resident of this State and has custody of the dependent; and

(b) student classified as a resident of South Carolina for in-state tuition purposes under Chapter 112 of this title at the time of enrollment at the institution.

(G) In addition to qualifications established by regulation, to qualify for a Palmetto Fellows Scholarship, a student shall:

(1) meet the following three criteria:

(a) a minimum score of 1200 on the Scholastic Aptitude Test (SAT) or an equivalent ACT score;

(b) a cumulative 3.5 grade point ratio on the Uniform Grading Scale at the end of the junior or senior year; and

(c) rank in the top six percent of the class at the end of the sophomore, junior, or senior year. When calculating eligibility for Palmetto Fellows Scholarships in schools where the top six percent of the graduating class is two students or less, the top two students must be considered for the scholarship regardless of class rank. The top six percent of the graduating class must meet all Palmetto Fellows Scholarship eligibility requirements in order to receive a scholarship. If the top six percent of the class is not a whole number of students, the Commission on Higher Education shall round up to the next whole number of students eligible; or

(2) meet the following two criteria:

(a) a minimum score of 1400 on the Scholastic Aptitude Test (SAT) or an equivalent ACT score; and

(b) a cumulative 4.0 grade point ratio on the Uniform Grading Scale at the end of the junior or senior year.

Qualifying scores must be certified by the high school on the Palmetto Fellows Scholarship application by the scholarship application deadline. For the purposes of meeting the rank criteria pursuant to this subsection, the existing high school rank of a South Carolina resident attending an out-of-state high school may be used provided it is calculated pursuant to a state-approved, standardized grading scale at the respective out-of-state high school. If the Commission on Higher Education determines that a state-approved standardized grading scale substantially deviates from the South Carolina Uniform Grading Scale, the state-approved standardized grading scale shall not be used to meet the eligibility requirements for the Palmetto Fellows Scholarship.

(H) Notwithstanding another provision of law, a student who met the initial eligibility requirements to receive a Palmetto Fellows Scholarship Award as a senior in high school and has met the continuing eligibility requirements shall receive the award. A student who received a Palmetto Fellows Scholarship Award as a senior in high school but declined the award is eligible to reapply for the annual scholarship, providing he meets all of the initial and continuing academic eligibility requirements of the Palmetto Fellows program, if he transfers to a qualifying South Carolina institution of higher learning. The number of semesters or academic years a student attended an out-of-state institution are to be deducted from the number of semesters or academic years a student is eligible for the scholarship. All funding provided for Palmetto Fellows Scholarships regardless of its source or allocation must be used to implement the provisions of this subsection. A student who uses a Palmetto Fellows Scholarship to attend an eligible two-year institution shall receive a maximum of four continuous semesters, and may continue to use the scholarship to attend an eligible four-year institution, subject to maximum number of semesters for which the student may be eligible for the scholarship.

(I) The Commission on Higher Education shall, by regulation, define alternative qualifications for an exceptionally gifted student who is a resident of South Carolina and is accepted into an institution of higher learning without having attended or graduated from high school.