A Conversation on Public Service Loan Forgiveness: The Philanthropic Community Can Help 250,000 New Yorkers Access $10 Billion in Loan Forgiveness (Part Two)
A Conversation with Rich Leimsider, Founder, PSLF.nyc, and Carolyn Peters, Manager, Learning Services, Philanthropy New York
The philanthropic community currently has the opportunity to help hundreds of thousands of people apply for Public Service Loan Forgiveness (PSLF). While PSLF has existed for 15 years, with the promise that anyone with a total of 10 years of government or nonprofit work experience would have all remaining student loans eliminated, in October 2021, the US Department of Education used emergency powers related to the COVID crisis to fix the program with the “PSLF Waiver” temporarily. This presents a significant opportunity for professionals in the philanthropic, non-profit, and human services sectors to address the over 1.6 trillion dollars in student debt mainly held in Black and Brown communities.
Carolyn Peters, Philanthropy New York’s Manager of Learning Services, sat down with Rich Leimsider, the founder of PSLF.nyc, to speak about the concerted effort by city leaders, including government officials and the philanthropic community, to help 250,000 New Yorkers access Public Service Loan Forgiveness and the opportunities it provides regarding retention of public sector staff at a time of high attrition, poverty mitigation, and racial equity.
This is part two of a two-part conversation. Read part one here.
Carolyn: What does it mean to really help people understand why it's so important to stick around in the social sector?
Rich: I think, you know what’s most important to the leadership of the pslf.nyc campaign and our steering committee, and what inspires me personally is the work's antipoverty and racial equity element.
What is probably also self-evident, that I’m sure you’re aware of, is that black women bear a disproportionate burden of student debt. In this whole country and in this city as well. I know that the philanthropic sector has been thinking and really wrestling with and really trying to address how to support leaders of color within philanthropy.
There are lots of important actions that need to be taken, but certainly, putting money in people's pockets is a pretty good way of demonstrating real support for early-stage leaders of color in philanthropy and particularly black women, which would have a real impact on the philanthropic sector.
Carolyn: Can you provide more context around that?
Rich: Of course. So, you know, the original public service loan forgiveness program wasn't really any good. What changed significantly last fall was that Covid-19 was declared a national emergency, and there is a law that says when the President has certified it as a national emergency the Department of Education can change the rules to some of their programs without getting permission. But because it was tied to a time of national emergency, it was only a temporary improvement. So, it was a 12-month-only waiver and ends October 31, 2022.
In theory, they could have the power to extend it by a few months at a time, and there are folks who are trying to get that done, but it also seems like it's politically become much more complicated with the challenges in the economy. So, we need to take advantage of this bird in the hand. And do everything we can to get as many people as we can over the finish line. We have till October 31st which is just shy of 18 days away. There’s not a lot of time to get the word out, but it is enough time to do the work, and many members of the Philanthropy New York community have already taken advantage. The challenge is not about giving people 20 hours of training to fill out a 50-page form. It's giving people a 5-minute message that they actually believe in and getting them to fill out a few pages.
Carolyn: To that note, what are some success stories that you've heard come out of this program?
Rich: There are a ton of success stories! Many of the success stories that we've seen so far have been in the more privileged sub-segments of the student borrower community. So for example, legal aid attorneys have known about different types of loan forgiveness for many years. There are a lot of lawyer loan forgiveness programs through law schools and other places. And so, for years there have been Facebook groups to create awareness of the program.
The New York Times ran a series of profiles on people who have already gotten loan forgiveness under this PSLF program. Now they are much more likely to be lawyers than the general population of those who actually remain in the pool, but the bottom line is there have been some terrific stories, and it’s a fun exercise to Google PSLF to check them out or even and if you're on TikTok or Twitter.
One of the most important things to our campaign from an anti-poverty perspective is that loan forgiveness is available even to folks that didn't finish their degree or their program. And we know that this is also a really key element in the work that we're trying to do. This program actually holds the most value for those who may NOT make a living wage. Let’s say there’s a human services worker who went to nursing school for 2 or 3 years.
In contrast to some of those attorneys or other professional folks who may have a lot, we have human services folks that are making $17 or $18 an hour working for a foster care agency. In the city folks that we have really gone to bat for to increase prevailing wages from city contracts and others. But there are a lot of those folks who have tried a year of higher, education tried to get a nursing degree at associates degree or something like that, and not made it through.
And so when we're talking about a single parent who's making an hourly wage, who has $15,000 in debt hanging over their families head that they will never actually be able to chip away at because without having finished the degree program, they never got to that next level of earning potential.
There’s a Federal law that says student loan debt is the only debt that you can't even get out of through bankruptcy. So, what that means is we've got real estate billionaires in our community who can get out of 1 million dollars in debt by declaring bankruptcy, and we've got childcare workers who can't get out of 15,000 dollars in debt.
Carolyn: All of that makes sense and I love that one of the things you mentioned earlier was, there's a misconception that this program doesn't apply to those who have not completed their higher education trajectory. Are there any other misconceptions or myths that you'd also like to take this opportunity to address?
Rich: My advice to people is to get the application in. It's a straightforward application and if you get it in by October 31st let the Federal Government worry about whether you should be rejected. We don't want anybody to psych themselves out thinking that for some reason they may not be eligible, and then they lose these benefits forever. So, let's have everybody get the paperwork in even if it's not exactly right. Get that paperwork in by October 31st and then let the Government worry about it.
The Government did a pretty good job building the help tool. We are lucky in New York City and New York State that we have resources for one-on-one counseling as well. The New York City Financial empowerment centers are available for one-on-one counseling for borrowers. The New York State Edcap program run by the Community Service Society is available for one-on-one counseling. But no one should reach out to any of those resources until they've tried the help tool just to see what's possible. There's really no downside to jumping in and seeing what the Government has to say about eligibility and seeing if you can figure it out on your own. The only other thing to remind folks is it's very exciting for people who have close to 10 years of service already in their pocket because all their debt might be wiped away pretty soon.
Carolyn: That’s truly amazing! Are there any words for the folks like myself who may be earlier in their careers?
Rich: For folks like you who are earlier on in their career, one of the most important things about this miracle waiver period is it allows the Government to give old credits, even if your paperwork wasn't done yet, and that's not allowed again. Starting November 1st, this specific waiver program won't be available. So, if you meet a teacher who's been working for 6 years for a public school but who never knew about this program and the October 31st deadline, from the Federal government's perspective, they're at 0 years of service to start and will have to wait to submit their forms. If we can convince that teacher to get their paperwork in right now, at least they'll be on step 6, Carolyn, even if you only have one year since school.
We're not only talking about people who've been out of school for 10 years. We're actually talking to any single person employed in government or nonprofit making sure they get the credit that the Federal Government owes them, but will only actually give them if they get that form in by October 31st.