87th LegislatureState HouseState SenateNew Program Would Offer Student Loan Relief to Qualifying Frontline Workers

The bills define “frontline worker” as “any person providing health, education, public safety, or other necessary support services related to the coronavirus pandemic, as determined by the [Texas Higher Education Coordinating Board].”

According to the proposals, the Texas Higher Education Coordinating Board is allowed to create its own list of “frontline workers,” but would be required to include:

• employees of public schools, open-enrollment charter schools, and private schools;
• employees of public and private institutions of higher education; 
• peace officers; 
• firefighters; 
• emergency medical technicians; 
• medical professionals, including doctors physician assistants, nurses, nurse practitioners, mental health professionals, and hospital support personnel; 
• employees of nursing homes, state-supported living centers, or similar long-term care facilities; 
• employees of child care facilities; 
• social workers; and 
• members of the Texas military forces, United States armed forces, or a reserve component of the armed forces who participated in coronavirus-related service.

In order to qualify for the student loan repayment assistance, applicants would have to have a college degree or certification or have earned at least 30 semester hours toward a degree prior to beginning work as a frontline worker.

Those applying for assistance would be required to show that they were frontline workers for a “substantial portion” of time between March 15 and December 31 of last year. The bills give latitude to the board to define what “substantial portion” means.

Applicants would have to provide verification of employment as well as the details of their student loans, such as the amount of principal, interest, fees, and any other charges due in connection with their note.

The legislation is not designed to rescue anyone from defaulting on their student loan debt. The bill specifically stipulates that the State of Texas would indeed not be responsible for paying the full amount due for the “period in which the award is disbursed.”

The funds would not be distributed in the same fashion as stimulus checks, but would instead go directly to lenders.

In addition, if an eligible applicant owed less than $5,000 in student loan debt, the person would only receive the amount they owed, not the full $5,000.

In terms of funding for SB 32 and HB 1205, the text of the bills says the board is required to “attempt to allocate all money available to the board” for the program. The proposal gives permission for fundraising campaigns and grant requests, as well.

According to projections by Comptroller Glenn Hegar, the state may end the current biennium with $946 million less than the 87th Legislature planned, which Hegar attributes to the pandemic.

In 2019, approximately 22 percent of American families were liable for student loans, with each indebted family owing a median of $22,000, according to data released by the U.S. Federal Reserve.

Americans who are in federal student loan debt are not required to make payments through September of this year, per an executive order President Biden signed within hours of being inaugurated that extended a similar order former President Trump had instituted.

A copy of SB 23, which is identical to HB 1205, can be found below.