Second Chance at Public Service Loan Forgiveness Act
This bill makes changes to the Public Service Loan Forgiveness (PSLF) program. Among other changes, the bill (1) allows a borrower who obtained an eligible Federal Direct Loan on or after January 1, 1994, to receive loan forgiveness under the PSLF program; (2) provides additional relevant definitions, including to specify that full-time employment is at least 30 hours a week; and (3) allows an eligible teacher to use the same teaching service to qualify for both the Teacher Loan Forgiveness program and the PSLF program.
[Congressional Bills 117th Congress]
[From the U.S. Government Publishing Office]
[H.R. 8474 Introduced in House (IH)]
<DOC>
117th CONGRESS
2d Session
H. R. 8474
To improve the public service loan forgiveness program under section
455(m) of the Higher Education Act of 1965, to improve loan forgiveness
eligibility provisions under such Act for teachers, and for other
purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
July 21, 2022
Mr. Norcross introduced the following bill; which was referred to the
Committee on Education and Labor
_______________________________________________________________________
A BILL
To improve the public service loan forgiveness program under section
455(m) of the Higher Education Act of 1965, to improve loan forgiveness
eligibility provisions under such Act for teachers, and for other
purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Second Chance at Public Service Loan
Forgiveness Act''.
SEC. 2. FINDINGS.
Congress finds the following:
(1) The public service loan forgiveness program under
section 455(m) of the Higher Education Act of 1965 (20 U.S.C.
1087e(m)) was created in 2007 to attract individuals to public
service by forgiving an individual's Federal loans under part D
of title IV of the Higher Education Act of 1965 (20 U.S.C. 1071
et seq.; 20 U.S.C. 1087a et seq.) after 10 years of employment
in areas of national need.
(2) These public service careers, which include employment
in military, emergency management, government, public safety,
law enforcement, public health, education, child care, social
work, services for individuals with disabilities, services for
the elderly, public interest legal services, and library
sciences, pay substantially less than similar careers in the
private sector.
(3) The public sector also repeatedly experiences workforce
shortages, especially following the COVID-19 pandemic.
(4) An undergraduate degree, certification, or advanced
degree is a prerequisite to enter or advance in these public
service careers. Yet, research suggests that the prospect of
several decades of student loan payments often deters
individuals from pursuing careers in public service.
(5) The public service loan forgiveness program has
substantially failed. In 2018, 99 percent of the borrowers who
applied for relief under the program were denied due to
improper type of loans, employment, or repayment plan, or the
number of payments that they had made.
(6) Advocates and enforcement agencies, including 38 State
Attorneys General and the Bureau of Consumer Financial
Protection, have repeatedly found that all of the major Federal
student loan servicers provided inaccurate information to
borrowers who were interested in or relying upon the public
service loan forgiveness program. They also found that
servicers repeatedly steered borrowers away from public service
loan forgiveness into higher monthly payments and into
deferment and forbearances.
(7) This has caused millions of public servants irreparable
economic harm, including preventing them from buying a home,
opening a small business, starting a family, or retiring,
because of their student debt.
(8) Despite the recent actions of President Biden's
administration to improve the public service loan forgiveness
program, these actions are limited and will not fully atone for
the repeated, pervasive, and systemic actions by Federal
student loan servicers to prevent public servants from fully
benefitting from this program.
SEC. 3. MAKING FORGIVENESS ATTAINABLE FOR PUBLIC SECTOR WORKERS.
Section 455(m) of the Higher Education Act of 1965 (20 U.S.C.
1087e(m)) is amended--
(1) by striking paragraph (1) and inserting the following:
``(1) In general.--The Secretary shall cancel the balance
of interest and principal due, in accordance with paragraph
(2), on any eligible Federal Direct Loan not in default for a
borrower who--
``(A) obtained an eligible Federal Direct Loan on
or after January 1, 1994;
``(B) has been employed full-time in public service
for a total period of 10 years or more after the date
on which the first eligible Federal Direct Loan was
obtained; and
``(C) while employed full-time in public service
during the period described in subparagraph (B),
completes 120 monthly payments on the eligible loans of
the borrower, pursuant to any one or a combination of
the following:
``(i) Payments under an income-based
repayment plan under section 493C.
``(ii) Payments under a standard repayment
plan under subsection (d)(1)(A), based on a 10-
year repayment period.
``(iii) Monthly payments under a repayment
plan under subsection (d)(1) or (g) of not less
than the monthly amount calculated under
subsection (d)(1)(A), based on a 10-year
repayment period.
``(iv) Payments under an income contingent
repayment plan under subsection (d)(1)(D).
``(v) Any monthly payment that would have
otherwise been made by the borrower on 1 or
more eligible loans during a period of
forbearance, including--
``(I) discretionary or mandatory
administrative forbearance;
``(II) forbearance described in
section 428(c)(3)(A)(i), including
forbearance because--
``(aa) the borrower is
serving in a medical or dental
internship or residency program
described in section
428(c)(3)(A)(i)(I);
``(bb) the borrower is
serving in a national service
position for which the borrower
receives a national service
educational award under the
National and Community Service
Trust Act of 1993 (42 U.S.C.
12501 et seq.); or
``(cc) the borrower is
eligible for interest payments
to be made on such loan for
service in the Armed Forces
under section 2174 of title 10,
United States Code, and,
pursuant to that eligibility,
the interest is being paid on
such loan under subsection (o);
``(III) forbearance provided
because the borrower is serving in an
educator residency program; and
``(IV) forbearance provided to a
borrower due to the borrower's
qualifying National Guard service.
``(vi) Any monthly payment that would have
otherwise been made by the borrower on 1 or
more eligible loans during a period of
deferment, including--
``(I) deferment relating to cancer
treatment under subsection (f)(3) or
section 427(a)(2)(C)(v);
``(II) deferment relating to active
duty during a war or other military
operation or national emergency, or
performing qualifying National Guard
duty during a war or other military
operation or national emergency, under
subsection (f)(2)(C) or section
428(b)(1)(M)(iii);
``(III) deferment relating to a
period of unemployment under subsection
(f)(2)(B) or section 428(b)(1)(M)(ii),
or of economic hardship under
subsection (f)(2)(D) or section
428(b)(1)(M)(iv);
``(IV) deferment provided in
connection with services in the Peace
Corps; and
``(V) deferment provided--
``(aa) while the borrower
is carrying at least one-half
the normal full-time work load
under subsection (f)(2)(A) or
section 427(a)(2)(C) and
employed full-time in public
service; or
``(bb) in connection with a
graduate student fellowship or
while employed by a qualifying
employer and pursuing a
graduate, professional, or
certificate program or in
connection with a
rehabilitation training program
under subsection (f)(2)(A) or
section 427(a)(2)(C).
``(vii) Any monthly payment that otherwise
would have been made by the borrower during a
grace period lasting in excess of 6 consecutive
months.'';
(2) by redesignating paragraphs (3) and (4) as paragraphs
(6) and (7), respectively;
(3) by inserting after paragraph (2) the following:
``(3) Special rules relating to employment.--
``(A) Grace period public service employment.--The
Secretary shall include any payments made by a borrower
on an eligible Federal Direct Loan during a 6-month
grace period, as described in section 428(b)(7)(A),
while the borrower was employed full-time in public
service, upon notification by the borrower of such
employment and payments made.
``(B) Americorps and peace corps service.--For
purposes of this subsection, volunteer service as an
AmeriCorps or Peace Corps volunteer, as described in
subclause (III) or (IV) of paragraph (6)(C)(i), shall
be deemed to be employment.''.
``(4) Special rule for certain loans and borrowers.--
``(A) Parent plus loans.--In the case of a borrower
of an eligible Federal Direct Loan that is on behalf of
a student, any public service employment required under
this subsection may be completed by the borrower or by
the student on whose behalf the loan was made.
``(B) Special rules for federal direct
consolidation loans.--
``(i) In general.--A borrower who has
obtained an eligible Federal Direct Loan that
is a Federal Direct Consolidation Loan that
includes a loan made, insured, or guaranteed
under part B or part E shall receive credit--
``(I) under paragraph (1) for any
years of full-time employment in public
service that occurred while the
borrower had a component loan of the
Federal Direct Consolidation Loan; and
``(II) under paragraph (1)(C) for
any monthly payment described in such
paragraph that was made by, or credited
to, the borrower on a component loan of
the Federal Direct Consolidation Loan.
``(ii) Special rules for joint borrowers.--
The Secretary shall allow the borrowers of a
Joint Consolidation Loan or a Joint Direct
Consolidation Loan who are employed in a public
service job to consolidate such loan into a
Federal Direct Consolidation Loan in order to
receive loan cancellation pursuant to this
subsection.''; and
(4) by striking paragraph (6), as redesignated by paragraph
(2), and inserting the following:
``(6) Definitions.--In this subsection:
``(A) Eligible federal direct loan.--The term
`eligible Federal Direct Loan' means a Federal Direct
Stafford Loan, Federal Direct Unsubsidized Loan,
Federal Direct PLUS Loan (including such loan made on
behalf of a student), or Federal Direct Consolidation
Loan.
``(B) Full-time.--The term `full-time', when used
with respect to employment in public service, means
working in public service employment in one or more
jobs for a total of--
``(i) not less than 30 hours a week;
``(ii) in the case of any form of
educational public service employment that is
under a contract for not less than 8 months,
not less than 30 hours per week during the
contract period; or
``(iii) in the case of employment as an
adjunct, contingent, or part-time faculty
member, teacher, or lecturer who is paid solely
for the credit hours taught at an institution
of higher education, the equivalent of 30 hours
per week determined by multiplying each credit
or contract hour taught per week by 3.35.
``(C) Public service.--
``(i) In general.--The term `public
service' means--
``(I) employment with a qualifying
employer described in clause (i) or
(ii) of subparagraph (D);
``(II) employment with a qualifying
employer described in subparagraph
(D)(iii) that--
``(aa) provides direct
services to the public through
its employees; and
``(bb) has devoted a
majority of its full-time
equivalent employees to working
in not less than 1 of the
following areas:
``(AA) Early
childhood education
programs.
``(BB) Emergency
management.
``(CC) Law
enforcement.
``(DD) Military
service.
``(EE) Other
school-based services.
``(FF) Public
education (including
higher education).
``(GG) Public
health.
``(HH) Public
interest law services.
``(II) Public
library services.
``(JJ) Public
safety.
``(KK) Public
services for
individuals with
disabilities or public
services for the
elderly.
``(LL) School
library services;
``(III) satisfactory service as a
Peace Corps volunteer in accordance
with section 5 of the Peace Corps Act
(22 U.S.C. 2504); or
``(IV) successful service as a
participant in a position described in
section 123 of the National and
Community Service Act of 1990 (42
U.S.C. 12573).
``(ii) Additional definitions.--For
purposes of clause (i):
``(I) Emergency management
services.--The term `emergency
management services' means services
that help remediate, lessen, or
eliminate the effects or potential
effects of emergencies that threaten
human life or health or real property.
``(II) Law enforcement.--The term
`law enforcement' means services
performed by an employee of a public
service organization that is publicly
funded and whose principal activities
pertain to crime prevention, control or
reduction of crime, or the enforcement
of criminal law.
``(III) Military service.--The term
`military service' means providing
service to or on behalf of members,
veterans, or the families or survivors
of members or veterans of the Armed
Forces, including the National Guard,
that is provided to a person because of
the person's status in the Armed Forces
or National Guard.
``(IV) Other school-based
services.--The term `other school-based
services' means an employee of a State,
or of any political division of a
State, or an employee of a nonprofit
organization, who works in any grade
from prekindergarten through grade 12
in any of the following occupational
specialties:
``(aa) Paraprofessional
services, including
paraeducator services.
``(bb) Clerical and
administrative services.
``(cc) Transportation
services.
``(dd) Food and nutrition
services.
``(ee) Custodial and
maintenance services.
``(ff) Security services.
``(gg) Health and student
services.
``(hh) Technical services.
``(ii) Skilled trades.
``(V) Public education.--The term
`public education' means--
``(aa) the provision of
educational enrichment or
support to students in a school
or a school-like setting,
including teaching; and
``(bb) teaching as a full-
time faculty member at a Tribal
College or University, as
defined in section 316(b), and
other faculty teaching in high-
needs subject areas or areas of
shortage (including nurse
faculty, foreign language
faculty, and part-time faculty
at community colleges), as
determined by the Secretary.
``(VI) The term `public health'
means--
``(aa) services provided by
physicians, nurses (including
nurses in a clinical setting),
and nurse practitioners; and
``(bb) services provided by
health care practitioner
occupations, health care
support occupations, and
counselors, social workers, and
other community and social
service specialist occupations,
as those terms are defined by
the Bureau of Labor Statistics.
``(VII) The term `public interest
law' means legal services or legal
advocacy provided by a nonprofit
organization, but excludes services
provided by individuals who are
registered lobbyists at the Federal,
State, or local level.
``(VIII) The term `public library
services' means the operation of public
libraries or services that support
their operation.
``(IX) The term `public safety
services' means services that seek to
prevent the need for emergency
management services.
``(X) The term `public services for
individuals with disabilities' means
services performed for, or to assist,
individuals with disabilities (as
defined in section 3 of the Americans
with Disabilities Act of 1990 (42
U.S.C. 12102)) that is provided to an
individual because of the individual's
status as an individual with a
disability.
``(XI) The term `public service for
the elderly' means services that are
provided to individuals who are aged
59.5 years or older and that are
provided to an individual because of
the individual's status as an
individual of that age, including
services related to retirement plans,
pensions, social security, retiree
health plans, or Medicaid.
``(XII) The term `school library
services' means the operations of
school libraries or services that
support their operation.
``(D) Qualifying employer.--The term `qualifying
employer' means--
``(i) a Federal, State, Tribal, local,
intergovernmental, or regional governmental
organization, agency, or entity based or
headquartered in the United States, including
the Armed Forces, National Guard, Merchant
Marines, or Coast Guard;
``(ii) a nonprofit organization that is
qualified under section 501(c)(3) of the
Internal Revenue Code of 1986; or
``(iii) a nonprofit organization that is
qualified under section 501(a) of such Code,
with respect to an employee in public service
employment.''.
SEC. 4. LOAN FORGIVENESS FOR TEACHERS.
The Higher Education Act of 1965 (20 U.S.C. 1001 et seq.) is
amended--
(1) in section 428J(g)(2) (20 U.S.C. 1078-10(g)(2))--
(A) in subparagraph (A), by inserting ``or'' after
the semicolon at the end;
(B) by striking subparagraph (B); and
(C) by redesignating subparagraph (C) as
subparagraph (B);
(2) in paragraph (7) of section 455(m) (20 U.S.C.
1087e(m)), as amended by section 3(2), by striking ``both this
subsection and section 428J, 428K, 428L, or 460'' and inserting
``both this subsection and section 428K or 428L''; and
(3) in section 460(g)(2) (20 U.S.C. 1087j(g)(2))--
(A) in subparagraph (A), by inserting ``or'' after
the semicolon at the end;
(B) by striking subparagraph (B); and
(C) by redesignating subparagraph (C) as
subparagraph (B).
<all>
Introduced in House
Introduced in House
Referred to the House Committee on Education and Labor.
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