In 2007, The Public Service Loan Forgiveness Program was established to help people in fields of public service repay their student loans. Seen as an opportunity to both entice people into fields of public service and to aid those who’d taken on student debt in the hope of serving others, the program should have been nothing but positive. However, continued denial of claims and government red tape have left many disheartened and frustrated.
The tenets of the program are fairly simple. According to the US Department of Education’s Federal Student Aid website, “The Public Service Loan Forgiveness (PSLF) Program forgives the remaining balance on your direct loans after you have made 120 (10 years) qualifying payments under a qualifying repayment plan while working full-time for a qualifying employer.” Teachers, nurses, employees of non-profit organizations or anyone that works for an organization “that provides a qualifying public service as its primary purpose” are all eligible for the program.
However, when the time came for the forgiveness of loans, the vast majority of applicants were denied. So, Congress stepped in creating Temporary Expanded Public Service Loan Forgiveness (TEPSLF). TEPSLF was supposed to streamline the process for applicants and came with a budget of $700 million.
Unfortunately, TEPSLF hasn’t fared any better than the original program according to a new report from government watchdog group, Government Accountability Office (GAO). According to the report during the first year of the TEPSLF program the U.S. Department of Education processed approximately 54,000 requests and approved only 661. Utilizing only $27 million of the $700 million Congress approved.
The main reason for the majority of denials? Approximately 71% was because applicants did not first apply to the already broken PSLF program. It appears the parameters of the program weren’t clearly laid out and left many even more frustrated and confused. “[The Education Department has] not competently administered this program,” US Rep. Bobby Scott, a Virginia Democrat and chairman of the House education committee told NPR.
Scott has said he’ll hold a hearing to keep the government accountable and give eligible students what’s rightfully theirs. “The students are entitled to it,” Scott told NPR. “They have fulfilled their responsibility over a decade of public service, and they’re entitled by law to have those loans discharged. …It is the constitutional responsibility of the executive branch to take care that the laws be faithfully executed, and we will focus public attention on the fact that they are not doing it.”
The hope is the recent report from the GAO along with the help of lawmakers might get the TEPSLF program functioning as was originally intended. In the meantime, thousands of students are left with unpaid loans.