370.537.1 - Student Loan Repayment Benefit
OPR: Office of Personnel
1. Purpose.This chapter provides policy and guidance for managers, employees, and Servicing Personnel Offices regarding the repayment of student loans and must be used in conjunction with the Department of the Interior policy and its amendment (pdf) which contains specific and detailed financial and tax requirements that must be followed.
2. Policy. The purpose of the student loan repayment benefit is to help agencies recruit skilled workers from outside the Federal sector and retain highly skilled workers in positions that are difficult to fill. It is a discretionary recruitment and retention tool available to managers. Thus, following the maximum flexibilities afforded by the Office of Personnel Management and the Department of the Interior (DOI), the USGS will use the student loan repayment, as needed, to:
Recruit candidates from outside the Federal sector when, in absence of that benefit, USGS would encounter difficulty in filling the position with a highly qualified candidate; and
3. Authority. Department of the Interior Personnel Bulletin 02-04 (537) and its amendment (pdf); 5 Code of Federal Regulations 537, and its amendment; Office of Personnel Management Questions and Answers; Public Law 101-510 (National Defense Authorization Act for Fiscal Year 1991); Public Law 106-398 (Floyd D. Spence National Defense Authorization Act for Fiscal Year 2001); Public Law 108-136 (National Defense Authorization Act for Fiscal Year 2004); Public Law 108-123 (The Federal Employee Student Loan Assistance Act, November 11, 2003); the Higher Education Act of 1965; the Public Health Service Act; and 5 U.S.C. 5379.
4. Determinations. Determinations relating to the payment of this benefit will be made independently of one another on a case-by-case basis. The amount of the repayment should be the minimum needed to recruit a candidate for employment or retain the concerned employee. Decisions of whether to offer the repayment and the amount to be paid are discretionary. These determinations are final. Employees have no appeal or grievance rights. Payments may be made up to a gross of $10,000 per year and a lifetime gross of $60,000. For recruitment purposes, determinations must be made before the employee enters on duty.
5. Coverage. Employees defined in 5 U.S.C. 2105 are eligible for repayment. Schedule C employees, term employees with less than 3 years remaining on their appointment, and temporary employees are not eligible. In addition, employees who have defaulted on student loans are not eligible until the loan is removed from default.
7. Requests for repayment. Before requests are made, the employee or candidate selected for the position must provide the SPO with official documentation from the lending institution that certifies the current outstanding loan balance (within the previous 30 days) and that the loan is authorized by the Higher Education Act of 1965 or the Public Health Service Act. The SPO will then verify the balance of the employee's outstanding loan to make sure that the loan is not overpaid, and ensure that it is federally insured or guaranteed and qualifies for repayment. For recruitment, this verification must be completed before the employee enters on duty.
All requests will be made in writing. Requests will be sent from the selecting official, through the Servicing Personnel Office for review, to the Regional Executive or appropriate headquarters official for approval. The approving official will forward the approved request to the Servicing Personnel Office and will provide a copy to the Regional Director, Associate Director, or Deputy Director for oversight.
8. Payment.Payments will be made on an annual basis. The SPOs, in coordination with the selecting official or representative (e.g., Administrative Officer), will send the National Business Center Payroll Operations Division a separate written authorization each year that repayment is authorized. To minimize the tax implication on the employee, the Payroll Operations Division will pay the net amount to the lending institution. The gross amount paid by USGS, however, counts toward the annual and lifetime limits and the outstanding loan balance. The employee must agree to make loan repayments on the portion of the loan that continues to be his/her responsibility. Further information regarding payment procedures and what needs to be included in the written authorization can be found in the DOI policy. Further information regarding tax implications can be found in the OPM Questions and Answers document.
9. Service Agreement. Employees who receive student loan repayments must sign a service agreement to stay with the USGS for 3 years. A new service agreement is not needed each year loan repayments are made. In rare cases, where appropriate and with the approval of the SPO, the agreement may be extended due to unforeseen circumstances (e.g., the employee goes on non-pay status - leave without pay for an extended period of time; sabbatical; etc.). Appendix A contains the service agreement. The SPO will work with the manager and employee to complete the service agreement.
A new service agreement is not necessary for each annual payment. However, with each payment, the employee must provide the SPO with official documentation from the lending institution that certifies the current outstanding loan balance (within the previous 30 days) and that the employee continued to make payments during the previous year. The SPO will verify the remaining loan balance to ensure that overpayment is not made. Differences between the gross amount of the payment and the net amount that is applied to the loan in order to minimize the employee's tax liabilities can be found in the DOI policy.
10. Reimbursement of a Repayment. During the service agreement period, if the employee (a) voluntarily leaves DOI, (b) transfers to another DOI bureau and then leaves the Department, or (c) is separated from the USGS due to misconduct or performance, he/she must reimburse the USGS for the entire gross amount of the loan paid by USGS.If an employee leaves a bureau that made the repayment for employment in another DOI bureau, the losing bureau will inform the gaining bureau of the employee's remaining service requirement. The gaining bureau will monitor the employee's completion of the service requirement. Since only the gaining bureau can collect reimbursement, if the employee leaves DOI during the service agreement period, the gaining agency will take action to recoup the amount of the loan repayment. Money recouped by the employing bureau will then be transferred to the bureau that paid the student loan. Request for waivers of repayment, in whole or part, must follow the DOI debt collection rules and procedures.
11. Discontinuation of a Repayment. If, during the service agreement period, the employee (a) leaves the USGS (even for employment in another DOI bureau), (b) does not maintain an acceptable level of performance, (c) fails to make loan repayments on the portion of the loan that continues to be his/her responsibility, or (d) violates any of the conditions of the service agreement, he/she is no longer eligible for continued benefits. In cases where an employee receiving a repayment leaves a DOI bureau for employment in another DOI bureau, the gaining bureau is not responsible for continuing the repayment. In addition, if the employee leaves one USGS program office for another USGS program office, the payment may be discontinued but the employee does not need to repay the loan amount already paid by the program office.
12. Reporting Requirements and Evaluation. The Headquarters Office of Personnel will coordinate reports as requested by the Office of Personnel Management and the Department of the Interior. The Headquarters Office of Personnel will also review the use and effectiveness of the student loan repayment authority annually and make changes to this policy as necessary.
Attachment - Appendix A-Service Agreement