The maximum amount that agencies can give to employees for
repaying their student loans has increased under the National
Defense Authorization Act for fiscal year 2004, the Office
of Personnel Management has announced in a memo for human
resources officers.
The cap is going from $6,000 to $10,000 per calendar year and
from $40,000 to $60,000 in total, and OPM says it will soon
issue regulations reflecting the new cap.
In return for assistance, employees must sign up for service
in the paying agency for three years, and reimburse the agency
in the event that they quit or are fired for poor performance
if they don’t complete the three years.
Earlier this year agencies reported to OPM a significant
increase in repayments for fiscal 2002. Sixteen federal
agencies provided more than $3.1 million on behalf of 690
employees and several agencies reported that use of the program
has helped them hire and keep personnel.
For example, managers at the Department of State used the
program as an internal recruitment tool to attract employees
to positions that have been difficult to fill. Because its
foreign-service employees are required to bid for ongoing
assignments, State used the loan repayment program as incentive
to fill difficult assignments on time. Still, some agency
managers said they did not use the program because they did not
want their actions to be perceived as favoritism. For the full
NDAA memo go here