Draft Education Dept. budget to possibly cut Public Service Loan Forgiveness Program

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Budget documents obtained by The Washington Post paint a bleak picture for many federal education programs: The newspaper reported on Wednesday that President Trump’s administration plans to cut them by a total of $10.6 billion. The proposed education budget would cut spending on programs in secondary education in order to funnel some of that money into school-choice programs, which have long been a major focus for Education Secretary Betsy DeVos.

In terms of money for higher education, the proposed budget would reportedly cut funding in half for the federal work-study program, and would sharply reduce grants focused on career and technical education. The most drastic change, however, may be the budget’s proposed elimination of the public-service loan forgiveness program, which was initially designed to benefit people who work in the public interest.

A spokeswoman for the Education Department told the Post that the figures it cited were preliminary until they have been released officially, and the White House is expected to release the Trump administration’s full budget for the 2018 fiscal year next Tuesday. Until then, here are a few key things to know about the public-service loan forgiveness program, and its uncertain future:

Congress approved it in 2007 as a way to aid borrowers in public-service jobs.

Those jobs can include work for government organizations or tax-exempt nonprofit groups, among other employers in the nonprofit sector. To receive the benefit, borrowers must make 120 on-time monthly payments — in other words, at least 10 years of such payments — on their student loans while working for a qualified employer. The Education Department encourages (but does not require) borrowers to submit forms certifying that they work for a qualified employer in order to keep track of their progress.

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