IFPTE Joins 200+ Organizations to Call on Dept. of Education to Deliver Promised Public Service Loan Forgiveness Relief
More than 200 student, consumer, higher education, labor, civil rights, public health, public interest, professional, military, and faith organizations - including IFPTE - joined a letter organized by the Protect Student Borrowers Center in calling on Secretary Cardona to take immediate executive action to deliver on the promise of Public Service Loan Forgiveness Program (PSLF) by cancelling debts owed by all public service workers who have served for a decade or more and to address to improve PSLF.
Thus far, 98% of borrowers who have applies for relief under the program have been denied. While the Department of Education is planning improvements to PSLF, their internal projections show that 80% of applicants will still be rejected. Read the Business Insider article, A Student-Loan Forgiveness Program Will Continue to Reject 80% of Public Servants Through 2026, Report Finds.
PSLF was created in 2007 to forgive federal, state, local, and 501(c)(3) and other qualifying nonprofit employees’ remaining student debt after 10 years of service. However, the program’s frequent mismanagement, lack of communication and public information, and complicated and narrow rules have left eligible borrowers without debt relief since 2017, the first year public service workers became eligible for debt relief. These failures have undermined the premise of the program: to ensure that student debt is not a barrier to students who want to establish public service careers.
The letter calls on Education Secretary Miguel Cardona and President Biden to:
Eliminate all student debt owed by those who have served for a decade or more. We call on you to establish new, streamlined criteria for a simple, straightforward path to cancel debt for all who have worked in public service for a decade or more. The current payment pause presents a unique opportunity to bring an end to the mismanagement and abuse that have become the hallmarks of PSLF. Simply, our remedy cannot require dedicated public service workers to start anew, following an equally complicated multi-year pathway to access relief, as the prior Administration had done. This relief must also be extended regardless of current employment status, ensuring all who have served can benefit. The elimination of public service workers’ debts must be underway before restarting student loan payments and before the imminent departure of the Education Department’s primary PSLF loan contractor— ensuring no public service worker who has served for a decade ever receives another student loan bill.
Grant one year of credit for each year of service for all public service workers who owe any type of federal student loan. This effort should grant prorated credit toward PSLF for every public service worker with student debt who has served for less than a decade. Regardless of borrowers’ loan type, loan status, or repayment plan, the Department of Education must recognize and reward borrowers’ service, consistent with congressional intent. By reorienting the criteria for eligibility to focus solely on the duration of public service performed, the Department of Education will also make public service workers whole where they have been the victims of widespread deception and fraud by the student loan industry.9
Ensure relief to public service workers is automatic. To the maximum extent possible, the Department of Education should automate the process of verifying and awarding credit to borrowers who owe these debts, relying on information already collected or available through other government agencies. Last month, the Department of Education used this approach to protect military borrowers, delivering debt relief to more than 47,000 current and former active duty service members by leveraging existing government records about borrowers’ employment to automatically waive interest charges.10 The Department of Education should build on this framework, leveraging a wide range of federal, state and local government records—including employment records maintained by the federal Office of Personnel Management, Internal Revenue Service records of employer tax status, and personnel logs maintained by public school districts—to identify and automate access to PSLF for all borrowers who can be identified as public service workers.