April 15, 2019

Warren Joins Gillibrand, Kaine, Colleagues to Introduce New Legislation to Overhaul Flawed Public Service Loan Forgiveness Program

99 percent of Applicants Have Been Rejected Under Current Public Service Loan Forgiveness Program Due to Failed Department of Education Implementation and Eligibility Loopholes; New Bill Would Ensure All Federal Loans and Repayment Plans Qualify and Simplify the Application and Approval Process

Bill Text (PDF) | Bill Summary (PDF)

Washington, DC - U.S. Senator Elizabeth Warren (D-Mass.) joined with Senators Kirsten Gillibrand (D-N.Y.), Tim Kaine (D-Va.) and a group of 12 other senators to introduce the What You Can Do for Your Country Act of 2019, new legislation that would overhaul the flawed Public Service Loan Forgiveness (PSLF) program and ensure millions of teachers, social workers, members of the military, first responders, nurses, public defenders, and many other public service professionals will qualify for the loan forgiveness they have earned. For years, the Department of Education has failed to properly implement the PSLF program, which has resulted in less than 1 percent of all eligible applicants receiving the loan forgiveness they deserve. This bill expands eligibility so that every type of federal loan and repayment plan is now included in the program, and ensures that public servants can count on repayment when they apply for loan forgiveness. 

"The Federal Government promised dedicated public servants they would not be saddled by decades of crushing student debt, and it is past time we fulfill that promise," said Senator Warren. "By fixing the program's implementation, this bill delivers relief for teachers, first responders, and other public servants. I'm proud to work with my colleagues to pass this critical legislation, and it should be included in any Higher Education Act reauthorization."

"The current Public Service Loan Forgiveness program is a bureaucratic nightmare, and the Department of Education is failing to meet its obligation to help ease the student debt burden for our nation's public servants," said Senator Gillibrand. "As a result, millions of teachers, social workers, members of the military, nurses, public defenders, and countless others have been denied the support they have earned through their hard work and service to our communities. It's time for Congress to fix this program and create a fairer and simpler process for public servants seeking loan forgiveness. I'm proud to partner with Senator Kaine to introduce this legislation to ensure that the Public Service Loan Forgiveness program is truly available for the millions of Americans who have chosen careers in public service, and I urge my colleagues to fight with me to pass this common sense bill as quickly as possible."

"Firefighters, teachers, servicemembers, and nurses have put in years of service - yet are getting denied the loan forgiveness they've earned," said Senator Kaine. "This bill is an opportunity to ease the burden of debt on our public servants by simplifying the loan forgiveness program. I hope my colleagues will join Senator Gillibrand and me to pass this legislation and provide those who serve their community and our nation the relief they deserve."

"The Public Student Loan Forgiveness program was started to provide student loan debt relief to public service workers who dedicate their careers to bettering their communities. Instead, the program has left millions of workers without a path to forgiveness, benefiting less than 1% of all public service workers who have applied. That's why AFSCME is proud to endorse the What You Can Do For Your Country Act of 2019, which would make eligibility requirements transparent, streamline the application process and close loopholes to give public serviceworkers and their families a fair chance to get ahead. No one should have to take on crippling student loan debt to gain access to the opportunities that come with higher education," said Lee Saunders, AFSCME President

"The Public Service Loan Forgiveness Program is intended to encourage college graduates to enter professions that benefit America, including education and public safety. Unfortunately, public servants who apply are far more likely to be denied loan forgiveness than to receive it," said Marc Egan, director of government relations for the National Education Association. "This important program has a critical mission, but due to numerous loopholes, coupled with a lack of oversight and mismanagement, it has not gone far enough in assisting those it was created to help. The 'What You Can Do For Your Country Act' offers several improvements and fixes that will help people who pursue meaningful, public-minded careers such as education. The NEA is proud to support Senators Kaine and Gillibrand in closing the loan forgiveness program's loopholes to ensure public servants receive the benefits they deserve for entering professions we all depend on."

"Equal Justice Works supports the 'What You Can Do for Your Country Act of 2019.' Public Service Loan Forgiveness (PSLF) is a critical program that supports the public health, public safety, and public education of communities across our country. PSLF is essential to our mission to build a community of public service lawyers committed to fulfilling our nation's promise of equal justice for all. I applaud the efforts of Senators Gillibrand and Kaine to support and preserve PSLF so that we can all benefit from the public health, education, and safety services provided by the borrowers who are relying on this vital program," said David Stern, Executive Director of Equal Justice Works.

"Since FDR's GI Bill, our country strongly rewarded public service. The Public Service Loan Forgiveness program was created in that same spirit, providing student debt freedom to nurses, teachers, public defenders, military, and others in careers that benefit all of our society. Unfortunately, roadblocks created by the Department of Education have resulted in less than 1% of all public servants receiving the student loan forgiveness they earned. Senator Gillibrand and Senator Kaine's bill is a comprehensive fix. It will allow millions of deserving borrowers, who were once denied access, complete loan forgiveness due to their contributions to public service," said Natalia Abrams, Executive Director of Student Debt Crisis.

Congress established the PSLF Program in 2007, but of the 1,173,420 public servants who have applied for forgiveness under the program, only 55 borrowers were approved, according to the Government Accountability Office (GAO). Senator Warren has long pushed for public service workers to get relief through this program and to fix the way it is administered. Studies have found that millions of borrowers took steps to enroll in the PSLF program, but were told after they had already made payments that they had the wrong type of loan or repayment plan and would not qualify for forgiveness under the program. In 2018, Senator Warren successfully fought to create a temporary fund to help borrowers, who thought that they were eligible but were not because of poor loan servicing, to access the program.

In addition to Gillibrand, Kaine and Warren, this legislation is cosponsored by Senators Richard Blumenthal (D-Conn.), Amy Klobuchar (D-Minn.), Dick Durbin (D-Ill.), Kamala Harris (D-Calif.), Chris Van Hollen (D-Md.), Cory Booker (D-N.J.), Jeanne Shaheen (D-N.H.), Jeff Merkley (D-Ore.), Maggie Hassan (D-N.H.), Tammy Duckworth (D-Ill.), Bernie Sanders (I-Vt.), and Tammy Baldwin (D-Wis.).

Specifically, the What You Can Do for Your Country Act of 2019 would do the following: 

  • Allow all types of federal loans to qualify. The bill would allow borrowers with both Direct Loans, and loans in the Federal Family Education Loan (FFEL) program, to qualify for forgiveness. Under current law, borrowers who took out federally-backed FFEL loans have been deemed ineligible for PSLF. This bill would allow borrowers to consolidate their loans without losing credit toward forgiveness.
  • Allow all federal repayment plans to qualify. Borrowers enrolled in any federal student loan repayment plan would be eligible to receive forgiveness. Under current law, borrowers who are on "extended" or "graduated" repayment plans fall into a loophole and are generally ineligible. 
  • Ensure that the Department of Education provides public servants with clearer information and guidance. The Department of Education would be required to give borrowers better up-front information about whether they qualify, how many payments are counted and why, and what they can do to dispute any issue with how their progress is determined. Borrowers who "pay ahead" will be clearly able to apply these payments toward forgiveness. 
  • Allow borrowers to receive a partial forgiveness benefit after five years of public service. Instead of making borrowers wait a full 10 years to receive full forgiveness, borrowers could have half of their loans forgiven at 5 years, with the remaining balance forgiven at the end of 10 years. This allows borrowers to contribute a shorter, but still meaningful, period of public service and to ensure they can still receive a benefit from giving back.
  • Simplify the application and certification process. The Department of Education would be required to provide a fully electronic system to upload and process all forms to ensure a more streamlined process. The Department would also be required to establish a database of qualifying federal and state employers to help some borrowers automatically qualify.