OPM seeks to expand student loan repayment benefit

The Office of Personnel Management has submitted a legislative proposal to Congress that would allow more federal employees to take advantage of student loan repayment benefits.

Under section 5379 of U.S. Code Title 5, agencies can repay employee student loans to "recruit or retain highly qualified professional, technical or administrative personnel." OPM's proposal would take out the phrase "professional, technical, or administrative."

"This proposal is designed to remove unnecessary and counterproductive restrictions on the discretionary authority of federal agencies to use the student loan repayment benefit to compete for employees in the diverse workforce of the 21st century," said OPM director Janice R. Lachance in a letter sent to House Speaker Dennis Hastert, R-Ill., and Vice President Al Gore.

Agencies can pay off up to $6,000 per year in student loans for each employee, but the total amount per employee cannot exceed $40,000. Those participating in the program must remain with the agency for at least 3 years.

The language in the current provision excludes employees who do not fall under the General Schedule system. For example, Customs Service officers and Border Patrol agents are not eligible for the benefits because those positions are not defined as professional, technical, or administrative.

Lachance said the current language excludes more than 400,000 non-postal, full-time executive branch employees from the student loan repayment benefit. About half of those employees are in wage grade positions.

"These exclusions serve no useful purpose. We strongly believe that eliminating them would benefit federal agencies in their recruitment and retention efforts," said Lachance.