Second Chance at Public Service Loan Forgiveness Act
Impact
If passed, HB7877 will significantly affect the legislation surrounding student loans and the PSLF program by introducing measures that allow borrowers to obtain forgiveness after 10 years of public service employment, contingent on making 120 qualifying monthly payments. The bill targets not only elementary and secondary educators but also expands eligibility to a broader range of public service professions such as military service, law enforcement, and emergency management. Furthermore, it seeks to rectify past abuses by lending servicers who have misinformed borrowers about their eligibility, thereby preventing financial harm and enabling them to pursue home ownership and other financial goals.
Summary
House Bill 7877, also known as the ‘Second Chance at Public Service Loan Forgiveness Act’, aims to enhance the existing Public Service Loan Forgiveness (PSLF) program established under the Higher Education Act of 1965. The bill seeks to address the shortcomings of the current program, which has failed to provide adequate relief to public service employees, with a staggering 99% of applicants denied loan forgiveness previously due to issues such as ineligible loans and payment plan discrepancies. By making changes to eligibility criteria and the forgiveness process, this bill hopes to encourage more individuals to pursue careers in public service, which typically offer lower salaries compared to private sector roles.
Contention
The bill has evoked various responses, particularly among advocates for public service workers who argue that the PSLF program has been inequitable and poorly managed. Critics highlight that although the bill corrects many flaws in the current system, the ultimate success in forgiving loans will depend on appropriate implementation and a reliable servicing framework to assist borrowers. Additionally, there are concerns regarding the financial implications of the proposed changes on federal budgets, especially in light of the rising costs of education.
To direct the Secretary of Education to deem each month for which certain Federal student loans are in deferment during a period of active duty service as months counted toward public service loan forgiveness, and for other purposes.
America First ActThis bill limits the eligibility of certain non-U.S. nationals (aliens under federal law) for various federal benefits and grants, makes permanent the child tax credit increase, and requires individuals to provide evidence of satisfactory immigration status prior to receiving specified benefits.The bill prohibits asylees, parolees, and individuals withheld from removal from receiving certain federal benefits, including Medicaid, Temporary Assistance for Needy Families, the Supplemental Nutritional Assistance Program (SNAP), and Supplemental Security Income. The bill further restricts on the basis of immigration status benefits under federal health programs such as Medicare, emergency disaster relief, housing assistance, food assistance, early childhood assistance, student aid, and Community Development Block Grants.The bill also makes permanent the increase in the child tax credit set to expire at the end of 2025. In addition, this tax credit and the earned income tax credit are not available to asylees, parolees, individuals granted temporary protected status, individuals withheld from removal, individuals granted deferred action for childhood arrivals (DACA) status, and non-U.S. nationals with employment-based immigrant visas.Federal aid is reduced for elementary and secondary education by 50% annually to jurisdictions that do not assist federal immigration enforcement actions (deemed sanctuary jurisdictions under the bill).The bill also removes statutory exemptions for Haitian entrants that allows such entrants to receive various aid.Certain benefits are prohibited, including Medicaid and SNAP, until an applicant’s satisfactory immigration status is proved.The bill prohibits tax-exempt 501(c)(3) charitable organizations from using federal funds to support certain non-U.S. nationals.