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senate Bill S. 3124

Should Interest on Federal Student Loans be Eliminated for Public Servants, Volunteer First Responders, & First-Time Farmers?

Argument in favor

Public servants perform valuable services in their communities, and student loan debt forgiveness is a valuable recruitment tool for these careers. Extending the program to more types of public servants and eliminating the accrual of interest for public servants helps make PSLF a bigger enticement for recent graduates to enter valuable public service careers.

Manuela's Opinion
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07/30/2018
There shouldn’t be a student loan. College should be tuition free for anyone. And so should healthcare be available for all. And yes, I am from overseas. And yes, we have all that.
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TrulyTexan's Opinion
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07/30/2018
The federal government should not be able to charge interest on any loans.
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Erin's Opinion
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07/30/2018
Yes but this should apply to all student loans. I am tired of not being able to deduct over $5,000 a year in interest on my husband’s student loans, which we have never been able to take, because we apparently make too much money. But with no children we are stuck in the worst tax bracket. We make too much to qualify for tax breaks that are typically offered to taxpayers with children.
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Argument opposed

The federal government’s public service student loan forgiveness program incentivizes students to borrow more for their education because they know that taxpayers will erase their debt after 10 years. Expanding eligibility for the PSLF even further to include first-time farmers and volunteer first responders will only skyrocket the cost of the program to taxpayers.

JTJ's Opinion
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07/30/2018
Absolutely not. Get the government out of the student loan business and you will see the price of tuition come way down.
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ToddSheets's Opinion
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07/30/2018
Student loan debt should be reduced or eliminated for all Americans. Period. Full stop.
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Poli.Sci's Opinion
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07/30/2018
It is all or nothing I am afraid. If you want to give back to the public by getting the government out of the loaning business, then it should be applied to all students, not just those in public service. Most of these students are not even paying for their college in the first place and are reimbursed through their place of employment to continue going to school or to gain additional degrees for their position.
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What is Senate Bill S. 3124?

This bill — known as the Help Encourage a Lifetime of Public Service, or HELPS Act — would eliminate federal student loan interest for borrowers working in public service professions enrolled in the Public Service Loan Forgiveness Program (PSLF). It’d also extend eligibility for the program to eligible volunteer first responders and first-time farmers. Currently, the Public Service Loan Forgiveness PSLF Program currently eliminates the balance of individuals’ federal student loan debt if they work in a public service profession for 10 years and make 120 qualifying payments on their federal loans.

Impact

Recent graduates with student loan debt; public servants; first-time farmers; and the Public Service Loan Forgiveness (PSLF) program.

Cost of Senate Bill S. 3124

A CBO cost estimate for this bill is unavailable.

More Information

In-DepthSen. Heidi Heitkamp (D-ND) introduced this bill to encourage more graduates to pursue public service careers by allowing them to pay off their student loan debt more quickly:

“Millennials are racking up disproportionately high levels of student debt, and the earnings of recent college graduates haven't kept up with the costs of steep loan and interest payments. This scenario has crippled the ability of rural areas to recruit new doctors, firefighters, farmers, and other public servants, as many capable young people are prevented from returning to their hometowns and using their skills to improve their communities… Public servants often sacrifice a higher salary somewhere else to stay in our communities and keep them strong and safe. I'm proud to strengthen the Public Service Loan Forgiveness program's benefits for teachers, nurses, and other professionals, but my bill also makes sure that volunteer first responders and farmers are recognized for their extremely important contributions to our state and our rural economy. Debt shouldn't be a barrier to our young people who want to serve our communities.”

Critics of the public service student loan forgiveness program argue that enrollees in the program have disproportionately high loan balances, with nearly 30% of enrollees having racked up more than $100,000 in student loan debt — many of whom obtained graduate degrees. In an economic analysis written for the Brookings Institute, Jason Delisle argues that the PSLF program distorts incentives for students to attend graduate school:

“Students who might balk at the high price of a graduate degree that is not likely to lead to a large increase in their earnings now face much lower effective prices for the degree — even a price of zero. That is bound to allow schools to set prices higher than they otherwise would and offer degrees with questionable value in the labor market. And the effect goes beyond tuition. Thanks to PSLF, a student like the hypothetical one… who is faced with the choice of borrowing $10,000 to live frugally while enrolled in graduate schools or $20,000 to support a more comfortable lifestyle is probably inclined to choose the latter. If he is likely to have the first $10,000 forgiven, then he is even more likely to have the next $10,000 forgiven.”

There is one cosponsor of the bill, Sen. Jon Tester (D-MT). The National Volunteer Fire CouncilNational Young Farmers Coalition, American Indian Higher Education Consortium, and the North Dakota branch of the National Education Association support this bill.


Of NoteThe Public Service Loan Forgiveness (PSLF) Program currently eliminates the balance of individuals’ federal student loan debt if they work in a public service profession for 10 years and make 120 qualifying payments on their federal loans.

The rising burden of student loan debt currently presents a major obstacle to those interested in careers positively benefiting the general public, such as public service or farming. According to the National Young Farmers Coalition, 53% of farmers have a difficult time making student loan payments — and 30% of young farmers put off full-time farming careers because of their debt. Student loan debt also often pushes qualified graduates out of jobs in public service professions in rural communities, as nursing, education, law enforcement, and agriculture jobs in smaller, rural communities often pay less than the same jobs in larger, urban areas.


Media:

Summary by Lorelei Yang

(Photo Credit: zimmytws / iStock)

AKA

Help Encourage a Lifetime of Public Service Act

Official Title

A bill to amend the Higher Education Act of 1965 to provide for no accrual of interest on Federal Direct Loans for individuals employed in public service.

bill Progress


  • Not enacted
    The President has not signed this bill
  • The house has not voted
  • The senate has not voted
      senate Committees
      Committee on Health, Education, Labor, and Pensions
    IntroducedJune 25th, 2018
    There shouldn’t be a student loan. College should be tuition free for anyone. And so should healthcare be available for all. And yes, I am from overseas. And yes, we have all that.
    Like (115)
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    Absolutely not. Get the government out of the student loan business and you will see the price of tuition come way down.
    Like (60)
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    The federal government should not be able to charge interest on any loans.
    Like (103)
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    Yes but this should apply to all student loans. I am tired of not being able to deduct over $5,000 a year in interest on my husband’s student loans, which we have never been able to take, because we apparently make too much money. But with no children we are stuck in the worst tax bracket. We make too much to qualify for tax breaks that are typically offered to taxpayers with children.
    Like (61)
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    Student loan debt should be reduced or eliminated for all Americans. Period. Full stop.
    Like (42)
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    It is all or nothing I am afraid. If you want to give back to the public by getting the government out of the loaning business, then it should be applied to all students, not just those in public service. Most of these students are not even paying for their college in the first place and are reimbursed through their place of employment to continue going to school or to gain additional degrees for their position.
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    Eliminate student loan interest on ALL FEDERAL LOANS, NO EXEMPTIONS
    Like (17)
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    HELPS Act — would eliminate federal student loan interest for borrowers working in public service professions. I didn’t know farmers were public service professional? I know they get subsidized, which is a liberal democratic social program! Which is for the good of all the people. Eating and living sounds good. Education and trades education should be free, for those who want it! We as a nation are behind in so many ways.
    Like (16)
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    End federal loans altogether.
    Like (14)
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    Public service is becoming a dying breed because of the image given it by the right. Having worked in public and non-profit agencies my entire career I can attest to the low pay and poor benefits that go with such work, even professional positions. Forgiving the loan interest may encourage the important work of caring for others.
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    Interest on student loans should be eliminated for everyone. It is a government sponsored rip off of an entire generation who are now being forced to live miserable lives because the government of their own nation is eating their productivity for breakfast in the form of interest on debt that should net exist in the first place. Every corporation in the country has made a bachelors degree the price of admission for entry level jobs you could get with a high school diploma when I graduated. Bank tellers, entry level reception and secretarial jobs, clerks if all stripes now supposedly need a college degree to count dollar bills and type and answer phones. The cost of that college education has exploded due to the ranks of administrative bureaucrats being added at record clip to every college and university while professors and adjunct faculty get the shaft when it cm es to wages and benefits. Administrators who add zero value to education are making six figures to sit in plush offices and never even interact with students in many cases. Yet students are carrying long term debt to pay the salaries of these pernicious barnacles. So no, student loan I Teresa should not be zeroed for certain select classes of graduates for whom we feel sorry this week. It should be zeroed for all of them. If we have $12 billion to pay out to farmers caught up in a stupid trade war, we can afford to stop dunning graduates to prop up loan sharking agencies belonging to the federal government.
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    Love how socialists thinks. Always a wrinkle about spending taxpayers money.
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    If interest is going to be waived fir any one group then it should be waived for everyone.
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    So you're basically arguing that taxpayers should give interest free loans to pay for the schooling of (1) government officials and their lackeys ("public servants"), (2) people who aren't good enough at being first responders to convince someone to pay them to do it ("volunteers"), and (3) incentivizing intellectuals to go out into the fields to farm (Khmer Rouge, anyone?). This is just a stupid idea. No, they are not entitled to a complimentary interest free loan. Fine if you want to give them that loan out of your pocket, but don't go trying to convince me that you have a right to loan to them out of mine.
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    Since there is currently an avenue for public servants to reduce their loan payback, this would be redundant. However, there are thousands of students without any avenue to reduce THEIR loan debt. If you want to help students reduce debt, there should be a plan for Everyone.
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    The economy of this country is never going to click on all cylinders until we lift the burden of student loan debt on millions of Americans. Just think how the economy would improve if these borrowers could pour that money into cars, homes, etc. instead of student loan payments. Imagine the job growth in the private sector. It’s time to reform student loan debt.
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    No exceptions for interest. Either all pay or all are excepted
    Like (6)
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    States should make college more affordable for all students. Parents should save money for their kids’ education. Student loans should be the exception, not the rule.
    Like (5)
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    If Congress continues to increase their salary and maintains lifetime health insurance, then the forgiveness of student loans for those who are doing MORE on a daily basis then members of Congress, YES!
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    It should be eliminated for everyone! Period!
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