I was just reading an article in the Chronicle of Philanthropy and I thought all of my nonprofit dreams had come true. The headline was "Congress passes bill to forgive student-loan debt for some charity workers." Was I reading an international version of The Chronicle? Was it AmeriCorp VISTA volunteer day at the Capital and they took over the voting? Or did my government suddenly take an interest in the financial stability of a whole class of workers that have dedicated themselves to the common good? Well, yes and no. Like most laws that seem fantastic on the surface, there are some downfalls. Let me list the many conditions that will make it unlikely that this new law will lift your crushing student loan debt:
- Workers can erase their student loan balances if they work 10 years in a public service career. This includes workers from tax-exempt charities, government employees, public-school teachers, law-enforcement officials, and public-health workers. Employees must be making student loan payments for those 10 years. (Right now you are thinking, "this is me" or "this is me in 9 and a half years", but wait...)
- The plan only applies to loan payments made after October 1, 2007. You have to be a current student or planning to go back to school to benefit.
- Annual income must be less than $65,000 at the end of the 10 year period.
- Forgiveness only applies to specific job titles like early childhood teachers, foreign language specialists, librarians and nurses.
- It sounds like the maximum loan forgiveness is $5,000.
I am torn between thinking this is a complete waste of legislation that only makes lawmakers feel good and doesn't improve the issue that they intended to address and believing that this is an important first step which may change the financial status of many social sector workers in the future and may be the solution to the sector's leadership gap. What do you think?
P.S. If you are a former political science or law student check out www.thomas.gov and look for HR 2669 and let me know if you can find any loopholes.