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Hochul signs legislation simplifying access to student loan forgiveness

  • / Updated:
  • Josh Durso 

Governor Kathy Hochul has signed legislation expanding and simplifying access to the federal Public Service Loan Forgiveness program.

The new legislation establishes uniformity around what qualifies as full-time employment for the purposes of accessing PSLF and allows public service employers to certify employment on behalf of workers, eliminating substantial barriers to applying for and accessing PSLF.

Finger Lakes Partners (Billboard)

“If you spend your days working for the people of New York, you shouldn’t spend your nights worrying about how to pay us back,” Hochul said in comments after signing the legislation. “From the workers who ushered us through the pandemic to the everyday heroes who keep New York moving, public-sector and not-for-profit workers deserve to make the most of this benefit – but without headaches, delays, or confusion. I’m proud to sign this legislation that ensures public servants have the clarity and the support they need to access federal loan forgiveness, and I thank my partners in the Legislature for their thoughtfulness on this bill.”

PSLF is a federal program that rewards and incentivizes public service work by cancelling a portion of borrowers’ federal student loans. The program requires borrowers to be full-time employees of an eligible public service employer and make 120 qualifying payments towards their student loan, after which the remainder of their federal student loan debt is forgiven. Any student loan debt that is forgiven under this program will not be subject to tax under New York State tax law.

Currently, approximately 2.7 million people in New York work in the public or nonprofit sectors. Since 2007, the transformative PSLF program has helped eligible public service workers receive an average of $61,402 in debt relief – providing public servants the opportunity to spend on a mortgage, monthly payments for a car, basic necessities like groceries and gas.

Finger Lakes Partners (Billboard)

Here’s how it works to address several well-document issues for accessing PSLF:

  • Clarifying the legal definitions of key terms such as, “certifying employment,” “employee,” “full-time,” “public service employer,” “public service loan forgiveness form,” and “Public service loan forgiveness program;”
  • Setting a standard hourly threshold for full-time employment at thirty (30) hours per week for the purposes of accessing PSLF and clarifying standardized prep time to be included in such calculation for faculty and teachers; and
  • Allowing public service employers to certify employment on behalf of individuals or groups of employees directly with the U.S. Department of Education.
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