the student loan repayment program in the federal

The Student Loan Repayment Program in the Federal Government:

Examining Program Users and Program Attributes

by

Fred Thomas III

A paper submitted to the faculty of

University of North Carolina at

Chapel Hill in partial fulfillment of the

requirements for the degree of

Master of Public Administration.

Spring 2010

This paper represents the work of a UNC MPA student. It is not a formal report of the School of

Government, nor the School of Government faculty.

Executive Summary

In 2001, the Office of Personnel Management (OPM) granted federal government agencies authority to

implement Student Loan Repayment Programs (SLRPs) to help recruit and retain talented workforces.

Federal government agencies’ use of SLRPs has increased significantly since 2001 at varying levels and

with varying attributes. This research used quantitative and qualitative methods to examine how agencies

currently and previously employ SLRPs as a tool to recruit and retain talent. Findings indicate

considerable variation in longevity and funding arrangements, relatively consistent general program goals

but with differing target audiences, a range of alternative administrative structure, and a general lack of

evaluation metrics. Recommendations are provided for users and potential users alike.

1

Background With ever-increasing competition between the public sector and the private sector for highly qualified

individuals, the federal government uses hiring incentives to recruit and retain talent.1 In 1989, the

National Commission on the Public Service found that federal government agencies had trouble recruiting

and retaining a quality workforce. In response, the commission recommended that Congress approve a

student loan repayment program (SLRP). This program would add to the list of incentives that agencies

had at their disposal.2 A SLRP would serve as a recruitment tool to both encourage interested applicants

to apply for the position and as an incentive for the applicant to accept the position once an offer was

made. Additionally, it could serve as a retention tool by creating an environment that would encourage

employees to remain with their specific agency.3

In response to a 2001 study released by the Office of Management and Budget (OMB) that found

professional and administrative government employees are paid less relative to their counterparts in the

private sector, Congress authorized SLRPs for highly qualified applicants and current workers. To receive

the loan repayment employees would have to commit to serve for at least three years in the paying

agency. Eligible employees could receive up to $10,000 in a year and up to $60,000 total.4 Research by

the Office of Personnel Management (OPM) on SLRPs from fiscal year 2002 to fiscal year 2008 found

agency adoption and overall funding for SLRPs has increased and spread throughout the federal

government.5

This study focuses on the SLRP as a recruitment and retention tool. SLRPs vary across federal agencies

partially because the Congressional authority to use the SLRP is broad in scope. This study examines

variation in SLRP implementation throughout the federal government by examining three main questions.

First, what are the characteristics of the agencies using SLRPs? Second, how did these agencies choose

their program goals? Third, how do agencies structure and administer their SLRPs? In addition, this study

will document why some agencies chose to adopt this program and what benefits and drawbacks agencies

identify. The findings from this study will help inform federal government agencies that are considering

or currently using SLRPs.

Methodology

Research for this study was completed in two parts. The initial phase was a quantitative analysis of

federal student loan repayment programs (SLRPs). Descriptive statistics on the student loan program as a

whole as well as within individual agencies were produced. Data for this analysis were from FY2002

through FY2008 reports released by the Office of Personnel Management (OPM).3 The data included

information on the 39 federal government agencies that used SLRPs between 2002 and 2008. The OPM

reports include SLRP allocations, the number of employees using the program, and the number of years

each agency used the program. In addition to OPM’s data, the data set was expanded to include the total

number of full-time equivalent employees (FTEs) and annual budgets.6 The data for these variables were

collected from budgetary reports from OMB and then standardized for the sample.7

A multi-case study methodology was employed for the second phase of the research. Interviews and

content analysis of selected agencies’ SLRP policies were conducted. Cases were selected using a

stratified random sampling technique. The starting sample was all 39 agencies that reported use of an

SLRP to OPM at some point between FY2002 and FY2008. The sample was then stratified based on two

core factors: agency size and length of SLRP use.8 Once agencies were separated into these groupings, a

random sample of eight agencies was selected, including two agencies from each quadrant.

To stratify agencies based on size, the study used groupings consistent with categories established by

OPM’s Federal Human Resources Database.9 They classify agencies as small if they have fewer than 100

FTEs, medium if they have 100-999 FTEs, and large if they have 1,000 or more FTEs. Due to limited

representation in the small agency category, the small and medium groupings were consolidated.10

2

Length of SLRP use was also categorized into two groupings: short-term and long-term users. Out of the

seven years of the program’s existence, short-term users are defined as agencies that used the program

from one to four years and long-term users are those that employed the program for five to seven years.11

Most of the agencies that began using SLRP in 2002 used the program for five to seven years. Most of the

late adopters or sporadic users fell into the short-term user category of one to four years.12

Agencies were randomly selected from each of the four groupings (for a full listing of agency distribution

see Appendix A Table 1A). Two agencies from each group were selected. With the exception of the Farm

Credit Administration, small agencies in the short-term users quadrant opted not to participate in this

research.13

A third agency was added to the large and long-term use category because large agencies seem

to have greater disparities in terms of agency and program size. The number of employees in the large

agencies span from just above 1,000 to over 600,000 employees. Adding an additional agency in this

category helps to capture more of the variation within this grouping. The selected agencies can be found

below in the Table 1.

Table 1: Selected Agencies

Size (Small & Medium) – 1 – 999 Size (Large) – 1,000+

Short-term Users

(1-4 Years)

Farm Credit Administration (FCA) Department of Commerce (DOC)

Agency for International Development (AID)

Long-term Users

(5-7 Years)

National Mediation Board (NMB)

Export-Import Banks (E-IB)

Department of Transportation (DOT)

Governmental Accountability Office (GAO)

Department of State (DOS)

Cases studies were completed by completing content analysis on each of the selected agencies to gain an

understanding of how different agencies administer SLRPs and how policies vary from the OPM policy

guidelines (for a complete listing of case studies see Appendix C). Semi-structured interviews were then

conducted with human resources employees or other representatives who worked directly with the SLRP

to clarify and expand upon the content analysis. Interviews provided a more in-depth look at each

agency’s SLRP (for a full listing of the interview questions see Appendix B). To capture various

dimensions of the program, questions were categorized into core areas of interest: background, policy

structure and administration, and program effectiveness (for a full analysis of the interview responses see

Appendix A Table 3A). Once content analyses and interviews were completed, the data were grouped to

show common themes among federal agencies using SLRPs (for a full listing of agency policies analysis

see Appendix A Table 2A). Other themes were gathered through policy analysis and interviews.

Limitations Federal agencies are large and complex organizations; thus, it is difficult to understand each aspect of

why and how they implement programs. This research is not intended to generalize how all agencies use

the SLRP incentive or if current non-users should implement the program. Rather, it is intended to

provide federal government agencies with general information about the status of SLRP in a sample of

agencies. Finally, this study and its recommendations are based on how agencies’ SLRPs are structured

and implemented but it does not evaluate program effectiveness. Some agencies have begun capturing

program efficiency data that will help address this limitation in the future.

Findings and Discussion

To better understand the characteristics of SLRPs, longitudinal data was reviewed based on the 39

agencies that have used the program since FY2002 (for a complete listing of agency descriptive statistics

3

see Appendix D). Of the total 39 agencies who used SLRPs, 70% of the agencies have used SLRP for 5

years or more. Half of the agencies have more than 100 employees participating in a SLRP. Only 5% of

total employees receive the maximum yearly allocation of $10,000. Approximately 13% of the agencies

are allocating over $1 million annually for SLRP.

Table 2: Seven Year Average (FY2002 - FY2008) n=39

Category Minimum Maximum Mean Mode

Average SLRP Allocation by Agency $6,000 $10,608,254 $744,881 -

Average Individual Allocation $2,551 $10,000 $6,893 -

Program Use (Years) 1 7 5 7

Total SLRP Employees 2 8,638 753 6

The programs from the sample represent variation in use, but a financial and administrative commitment

is being made by all participating agencies. Still little is known about how these programs are being

implemented in practice. Findings for the qualitative data will be discussed for the following categories:

Program Background and Goals, Policy and Structure, Program Administration and Effectiveness.

Program Background and Goals

Results on program background provided context for each agency’s program including: program goals,

size, funding, and other hiring incentives used. Across the agencies selected for case studies, the primary

goals of SLRPs are to recruit and/or retain highly qualified employees. Seven out of the eight agencies

identified the use of the program as restricted to recruiting and retaining highly qualified employees or to

staff hard to fill positions.14

On the contrary, GAO allows all of their current employees to apply to the

program regardless if they are in a hard to fill position or not. It is also interesting to note that Farm Credit

Administration (FCA) focuses solely on SLRP as a recruitment tool.15

Within the total sample of 39 agencies that have used SLRPs, findings indicate that agency size seems to

have a connection with funding and long-term use. Of the 28 large agencies, 23 of them were long-term

users of SLRP. Similarly, 7 of the 11 small agencies were shown to be short-term users of the program.

Within the case study sample, two out of the three small agencies, National Mediation Board (NMB) and

Export-Import Bank (E-IB), ceased using the program due to a lack of available funding. The other six

agencies from the case studies are still actively using the program. Three of the five large agencies

included in the sample have programs with at least 100 employees.16

Other hiring incentives that agencies offer also seem to have an effect on the way SLRPs are utilized.17

All of the agencies within this study employ a range of recruitment and retention incentives in addition to

the SLRP. FCA only uses SLRP for recruitment and uses other incentives such as retention bonuses for

retention purposes. Similarly, agencies that use recruitment bonuses or other recruitment incentives

typically use the SLRP more exclusively for retention purposes.

Policy & Structure

Content analysis of the policies shows variation in agencies’ policies and variation in how these policies

expand upon regulatory requirements (for a sample listing of agency policies see Appendix E). OPM’s

guideline for SLRP notes a statutory three-year service commitment, a $10,000 per year maximum, and a

$60,000 total maximum total payout. While the initial three-year service commitment is mandatory across

all of the agencies using SLRP, the OPM policy does allow agencies to set lower repayment limits. Two

agencies from the sample, FCA and E-IB, set different total maximum payouts. Due to budgetary

4

constraints, the Export-Import Bank places limits on the monetary amounts with a $6,000 per year

maximum and $40,000 total maximum payout.

Beyond the statutory requirements, agencies are also given the autonomy to set restrictions on the types of

employees who are eligible to use the program. For example, DOS only offers the SLRP incentive to

employees in the Foreign Service. FCA is the only agency that has a policy that awards all employees

who qualify for the SLRP incentive without out any nomination or application by the employee or

manager. FCA only provides the SLRP incentive for one year with a maximum of $9,000 based on an

exception granted by the Farm Credit Act of 1971.18

Although the program is typically targeted at

recruiting bank examiners, the program is open to all employees. The Department of Commerce (DOC)

provides another type of variation from the OPM policy in an effort to increase retention rates they have

service commitments up to seven years.19

Program Administration All of the agencies’ programs are administered through the main headquarters of the agency; however, the

large agencies – DOC, GAO, AID, DOT, and DOS – all have SLRPs that are broken into agency

divisions. The divisions within the agencies have some or complete autonomy over the program and are

actively administering the program. For example, divisions within DOT make the decision on whether to

establish a SLRP for their unit. They are also given the responsibility of initiating the program, setting

goals, funding, and managing the program.

Farm Credit Administration’s SLRP is administered at their National Headquarters by the Chief Human

Capital Officer. However, as long as employees meet the minimum requirements, any HR official at any

level is able to offer the incentive. The incentive is typically advertised and offered to students through

local university partnerships. Employees who are hired through other means are automatically eligible

upon meeting the eligibility criteria.

Program Effectiveness

Respondents in this study indicated that at least 75% of their employees met the service commitment

requirement established by their respective agencies. This was true for all agencies with the exception of

AID and E-IB who were unable to report any quantitative measures of performance. Although most

agencies noted a 75% or more success rate, only three of the eight agencies keep performance metrics.

Additionally, respondents were asked about success based on the standardized three-year commitment

and does not account for agencies with commitment periods longer or shorter than three years.20

Overall, all agencies in this project indicated that they are looking to establish performance metrics to

measure how the SLRP helps them meet larger agency-wide goals; however, three of the eight agencies in

the sample, FCA, DOS, and GAO, do have explicit performance metrics that measure program

effectiveness based on the specific programs’ established goals. For example, DOS has established

metrics to compare incentives.

The DOS metrics track employees meeting the eligibility requirements of the following:

Employees in mission critical positions or hard to fill positions

The number of resignations by employees subject to the mandatory three-year service

commitment or additional service commitment periods

The impact of the SLRP incentive on assignment selections by Foreign Service employees

Conclusion and Recommendations Some federal government agencies are looking to establish, reestablish, or improve SLRPs. The OPM

policy provides a foundation for each SLRP with the statutory requirements of the program, but each

agency is given the flexibility in program administration to achieve their specific goals. There is no one

5

solution to deciding to use a SLRP or how to structure it; programs come in different forms and are used

in very different ways. Still, the case studies provided some lessons and themes

In the case study sample, the characteristics of the program seemed to be related to agency size. Five out

of the eight case study agencies were classified as long-term users and had highly sustainable programs –

programs that were funded every year after being established and that served a large number of

employees. Two exceptions to this are DOC and DOT who only had 10 and 37 employees respectively

using the program in 2008 compared to the average of 247 at the other agencies in the category.

Additionally, programs in this sample with average or above average funding were more likely to

continue to fund and use the program in subsequent years. In the case of NMB and E-IB, funding was

extremely low which resulted in sporadic use and ultimately inactivity of the program according to the

interview. While the budgets seemed to be a gauge of the longevity of the program, sometimes the size of

an agency in combination with the goals of the program acts to influence the budget. For example, if the

goal is to fill specialized positions, an agency could have a large SLRP budget one year and a

significantly smaller budget the next dependent upon the number of specialized positions needed.

Whatever the agency characteristics are, individual agencies must decide if it is a useful tool for them.

The SLRP incentive is restrictive in that it is targeted at individuals who have a college and/or graduate

level degrees, which is a limited portion of the recruitments for the federal government. As a result,

agencies use various tools. Agencies reporting successful recruitment measures indicated that they use the

SLRP incentive more for retention purposes and vice versa. If an agency had a solid recruitment and

retention system in place, it was less likely to use the SLRP incentive. In addition, some agencies are

using the SLRP incentive to meet broad goals while others are looking to satisfy a very specific goal. This

demonstrates that the program must be considered as one of a wide array of recruitment and retention

tools the government uses for all of its employees.

Listed below are a few issues to consider when assessing whether to use SLRP:

Consider if the agency is having a problem with recruiting or retaining employees. If so, is that

problem with types of employees who might have outstanding loans?

Assess if the program will be useful based on the other incentives already being used within the

agency. Can different or current incentives achieve the goals of organization or are there gaps?

If an agency decides to establish a SLRP, it must consider how the program will be structured. The most

important aspects of any SLRP are the statutory requirements reflected in the OPM policy: the three-year

service requirement, the maximum repayments, and the types of federally repayable loans. Once those

features are established, an agency has the ability to shape the program in order to meet its own goals.

The following are some additional considerations about structuring an SLRP that is tailored to individual

agencies:

Set reasonable yearly and total repayment standards based on your budget. There is flexibility in

the maximum yearly amount and total maximum; there is no requirement to offer the maximum

amount.

Establish specific goals for the program: i.e. recruitment and/or retention, hard to fill positions

like Foreign Service or all positions, increasing the number of employees with advanced degrees,

etc.

Establish performance metrics to help assess the program individually, in relation to other

incentives, and against agency-wide goals. This will provide information about whether the

program is achieving the goals set by the agency or if other incentives may be more useful.

6

Endnotes

1 Lewis, Gregory B., and Sue A. Frank. "Who Wants to Work for the Government?" Public

Administration Review • July/August 2002, Vol. 62, No. 4 (2002): 395-404. 2 Ibid.

3 Workforce Planning for Wisconsin State Government. (2005). Employee retention. Retrieved October 7,

2009, from http://workforceplanning.wi.gov/ category.asp?linkcatid=15&linkid=18 4 In 2002, the original OPM policy stated that agencies were able to authorize a student loan repayment of

up to $6,000 for an employee in any calendar year, and up to a lifetime limit of $40,000. In 2003, that

amount was increased to $10,000 in a calendar year and a lifetime limit of $60,000. This was changed in

order to assist agencies in effectively using student loan repayment as a recruitment and retention tool. 5 "Student Loan Repayment Program". Office of Personnel Management. August 10, 2009

<http://www.opm.gov/oca/pay/StudentLoan/>. This website houses federal government agency reporting

to OPM on the SLRP from 2002-2008. 6 Full-time equivalent employees (FTEs) accounts for full-time employees working 40 hours per week

and part-time employee hours are added together and divided by 40 to determine the number of full-time

employees. 7 The number of FTEs compared to the number of SLRP employees, completing seven-year averages of

the number of FTEs, total SLRP allocation, individual SLRP allocation, and annual budget totals. 8 Because this study is looking to assess who is using SLRP and how they are using it term of use was

identified as a factor worth considering. Agency size was considered a major factor based on the

quantitative analysis. 9 "FedScope Human Resources Data". Office of Personnel Management. August 10, 2009

<http://www.fedscope.opm.gov/employment.asp>. 10

By having three categories: small, medium, and large, many of the resulting quadrants had no agencies

represented based on the criteria. There is a huge disparity between the lowest number of FTEs and the

highest number of FTEs in the large agency, long-term user category. 11

The determination of a breakpoint was made at a natural break; the midpoint of program use was

identified as an appropriate point. 12

The grouping was intended to capture the variation between institutionalized programs and sporadic

users of the program. 13

Several attempts were made to contact the agencies in the short-term, small agency category. Attempts

included phone calls and emails. In the short-term, small agency quadrant, some agencies were no longer

using the SLRP incentive. An additional agency was added to the large, long-term user quadrant bringing

the total to three agencies in that quadrant. 14

Agency’s selection factors for employees seem to change based on the goal set for SLRP. 15

FCA’s policy does not address using SLRP as a retention tool. 16

The only exceptions to this claim about large agencies are the Department of Transportation (DOT) and

Department of Commerce (DOC). DOT only has 37 employees using the program and DOC only has 10

employees using the program. 17

Examples of these incentives include: tuition reimbursement, recruitment bonuses, retention bonuses,

travel compensation, extra health benefits, and relocation reimbursement. 18

FCA does not follow the OPM’s SLRP policy because of a special authority. As a federal regulator,

FCA uses their SLRP based on section 5.11(c)(2)(A) of the Farm Credit Act of 1971. 19

The extended commitments are increased based on the amount of the SLRP allocation, for every

additional $10,000 after $20,000 an additional year is added to the service commitment. 20

The percentage does not standardize for the one-year annual commitment. Programs with more

employees on one-year commitments than three-year commitments are likely to have a higher success

rate due to the shorter time period.

http://workforceplanning.wi.gov/%20category.asp?linkcatid=15&linkid=18

7

Appendix A: Sample and Analysis Information

Sampling Distribution

Policy Analysis

Interview Responses

8

Table 1A: Sampling Distribution (including all 39 agencies)

Size (Small)

1 – 999

Size (Large)

1,000+

Short-term Users

(1-4 Years) Farm Credit Administration

Federal Housing Finance

Committee for Purchase from Severely Disabled

Office of Special Counsel

Chemical Safety and Hazard Investigation Board

International Trade Commission

Pension Benefit Guaranty Corporation

Department of Commerce

Library of Congress

Agency for International Development

Federal Trade Commission

Department of Homeland Security

Long-term Users

(5-7 Years) National Mediation Board

Inter-American Foundation

Export-Import Banks

Defense Nuclear Facilities Safety Board

Department of State

National Aeronautics and Space Administration

Environmental Protection Agency

Department of Labor

Department of Energy

General Services Administration

Department of Housing and Urban Development

Department of Education

Office of Personnel Management

Securities and Exchange Commission

Nuclear Regulatory Commission

Government Accountability Office

National Archives and Records Administration

Government Printing Office

Federal Energy Regulatory Commission

Department of Defense

Department of Veterans Affairs

Department of Treasury

Department of Justice

Department of Agriculture

Department of Interior

Department of Health and Human Services

Department of Transportation

9

Table 2A: Policy Analysis Results

Agency

Name

Policy

adoption

year

Selection factors Money variation by selection

factors

Stated goals in

policies

Differences from OPM

Policy

Commitment Approval process

Farm Credit

Administration

2006 All employees are

eligible, typically offered to recent college

graduates and Bank

Examiners.

Allotment is the same for all

applicants.

To recruit highly

qualified candidates.

Only provided for 1

year with a $9,000 maximum total.

Required to stay 1 year with

3 installments paid (start, middle and end of first year)

Preapproved. Any HR staff person is

authorized to offer the program to recent college graduates or graduating

students

National

Mediation Board

2004 Hard to fill positions N/A To help fill hard to fill positions

N/A Required to stay 3 years Supervisor’s put in a request to HR to hire for a hard to fill position with the

SLRP

Export-Import

Bank

2002 Advanced degrees; Hard to fill positions

More money is offered to hard to fill positions. Amount is

designated based on budgetary

constraints

To help fill hard to fill positions and

recruit highly

qualified candidates

Maximum allotment is $6,000/year and

$40,000 total.

Required to stay 3 years Supervisor provides documentation to HR staff. Approval is given by HR

Director

Department of

Commerce

2005 Exceptional qualification; Hard to

fill positions

Amount is based on employee’s value to the operating unit

To help fill hard to fill positions and

recruit highly


Service commitment can exceed 3 years.

Total number of years

can be increased up to 15 years.

Required to stay a minimum of 3 years for repayment of

$20,000. Every $10,000 adds

another year of commitment up to 7 years.

Each operating unit advertises the incentive or decides to select a hard to

fill position. National HR office must

review and approve the selection.

Agency of

International

Development

2005 Any employee with

student loans.

N/A To help recruit and

retain highly qualified candidates

N/A Required to stay 3-years. Supervisors make recommendations

and regional offers approve applications. Applications are

submitted to the national office, but

autonomy is given to regional offices.

Department of

Transportation

2004 Exceptional

qualifications

Each regional office determines

amount.

To help recruit and

retain highly


N/A Required to stay 3 years. Supervisors make recommendations

and regional offers approve

applications. Applications are submitted to the national office, but


Governmental

Accountability

Office

2002 Any employee with

student loans.

General category employees

and special category employees.

Special category employees

tend to receive more money.

Money is determined by Supervisor and HR.

To retain highly

qualified employees

Applicants must reapply

every year. The 3 year

commitment is only

required for

recruitments.

Required to stay 3-years. Employees apply and the national HR

office approves requests.

Department of

State

2002 Hard to fill positions,

mission critical positions

N/A

To help recruit and

retain mission critical positions

and hard to fill

positions.

N/A Required to stay 3-years. Supervisors make recommendations

and regional offers approve applications. Applications are

submitted to the national office, but


11

Table 3A: Interview Responses

Agency

Name

Recruitment or

retention tool

or both

Program goal(s): Program Criteria:

Job specializations

or everyone

Program restrictions Other hiring incentives Program Administration

Who? Where? How?

Farm Credit

Administration

Recruitment Help recruit recent college graduates. To

remain competitive with

private sector and other regulatory agencies.

Anyone coming in with student loans

Any student recruited to work there, typically bank

examiners are able use the

program. Program is offered to everyone with loans.

Tuition reimbursement, travel compensation, extra health

benefits, transferable leave

accrual. Higher starting salary. Retention bonuses

National Level, anyone on HR staff

National

Mediation Board

Recruitment &

Retention

Assist in recruiting and

retaining employees in hard to fill positions

Only offered for hard

to fill positions

Only offered for hard to fill

positions

Relocation bonuses, retention

bonuses

National Level, Program Manager

(supervisor)

Export-Import

Bank

Recruitment and

retention

Attract and retain highly


Highly qualified

candidates and hard

to fill positions


positions and individuals with

exceptional qualifications

Tuition reimbursement National Level, supervisor’s with

approval of HR office

Department of

Commerce

Recruitment and

retention



Highly qualified

candidates and hard

to fill positions


positions and individuals with

exceptional qualifications

Relocation bonuses, retention

bonuses, recruitment bonus

National oversight, regional

selections.

Agency of

International

Development

Recruitment and

retention



Any employee with

loans is eligible.

Anyone can apply Additional health benefits National oversight, regional

selections.

Department of

Transportation

Recruitment and

retention



Highly qualified

candidates and hard

to fill positions

Anyone can apply. Relocation bonuses, tuition

reimbursement


selections.

Governmental

Accountability

Office

Recruitment and retention

To retain highly qualified candidates

Any employee with loans is eligible.

Anyone can apply. Employees must reapply

every year.

Up to 6% Retention bonus used to retain employees not on the

SLRP

Advertised at the national level. Employees apply and unit

supervisors make

recommendations. National HR Director then approves selections.

Department of

State

Recruitment and

retention

Assist in recruiting and

retaining employees in hard to fill positions and

mission critical positions

Any employee in the

Federal Service with loans is eligible.

Anyone can apply. Relocation bonuses, retention

bonuses, recruitment bonus


selections.

12

Table 3A Continued: Interview Responses

Agency

Name

Resources: Money at the

outset, sustainability

Changes and

improvements made or

being considered.

Current Status of

the program

Performance measures

or metrics

SLRP employees meeting

requirements

Impact on the recruitment or retention

process

Farm Credit

Administration

Organization supports the program because it is a

successful recruitment

tool.

N/A Still active with added funding

every year

Yes 80% of the recipients stayed

Established partnerships with local universities to recruit many recent college graduates

National Mediation Board Very little funding. Reduced funding over the

past 3 years.

N/A No longer actively using

No 75% of the recipients stayed

Helped attract a few employees to hard to fill positions

Export-Import Bank Very little funding. Reduced every year since

the program was started.

N/A Program has been declining since the

first year of use.

No longer actively using the program.

No N/A Helped to recruit for a few hard to fill positions

Department of Commerce Low level of funding,

Flexible yearly funding

Increase in the maximum

annual SLRP award.

Currently has 10

employees using

the programs

No About 90% Helps to recruit employees in hard to fill

positions and helps retain mission critical

employees.

Agency of International

Development

Above average level of

funding

Reducing the time it takes to

gain responses back from

the employee or lenders

regarding loan payment

status.

Active with over

100 employees

using the program.

No N/A A recruitment incentive that helps increase

recruits desire to join the agency and provides a

retention incentive that ensure that employees

stay for at least 3 years.

Department of

Transportation

Average level of funding N/A Over 70 employees currently using the

program.

No 80% of the recipients fulfill their 3-year

commitment.

Helps to retain employees better than other incentives.

Governmental

Accountability Office

Very high level of

funding, the agency has increased the budget

every year.

Reducing the advertising

time and reducing security clearance timing.

97% growth rate

from year to year

Yes. Looking to expand

performance measures.

99% of employees

recruited stayed.

Helping to retain highly qualified employees.

Department of State Very high level of funding, the agency has

increased the budget

every year.

Ensuring that the SLRP is allocated to the federally

approved loans and not all

loans held by the lender.

Over 700 employees

currently using the

program.

Yes. Has cross-sectional data for comparison.

Approximately 90% of employees finish their

service commitments

Helps to recruit and retain employees within the foreign service.

13

Appendix B: Interview Protocol

Interview Questions

14

Interview Questions

Background

1. Tell me a little bit about how and when your SLRP program was established.

o Why was the program created?

1. Was the SLRP mandatory for your organization to participate in?

Mandatory based on OPM Legislation, Presidential Order, etc.

2. What motivated the establishment of the program?

3. Was it to increase applicant pool, add another incentive, attract best and

brightest?

2. What was the original purpose (goal) of establishing the program?

o Retention

o Recruitment

o Is the program used as a recruitment and/or retention tool or is there another reason?

1. Is it used in order to recruit more talented workers, advanced degrees, etc.?

2. Are there any other hiring incentives used within the hiring process?

Are they more prevalent that the SLRP?

What other hiring incentives are used?

1. When are they used instead of the SLRP program?

3. Is the SLRP used to create more competitive starting offers?

o Is this used to hire employees and pay them less money with higher benefits?

Policy Structure and Administration

4. How is the SLRP administered?

o Who administers the program

1. National Office, Regional Office, HR Director, Program Manager, etc.

o Where is the office that administers the program located?

1. In-house, in another location, field office, headquarters, etc.

o Who can offer it?

o How is authority designated for a SLRP offer?

1. Are their certain positions that automatically qualify?

2. Are their certain candidates that automatically qualify (specialized degrees, etc.)?

5. Could you please describe any agency specific main policy or structural elements or guidelines

for the SLRP program?

o Who’s eligible? Do they apply, are they nominated, is it part of a job offer?

1. If they had to apply – how are they finally selected?

2. If nominated – who nominates?

3. If part of job offer – which person and/or office has the authority to offer SLRP?

o Who decides (and how) how much an employee will receive that year?

o Do all employees get the same amount?

o Who manages the administration of the SLRP and the paperwork once the employees

have been selected?

o How does an employee apply/continue to receive SLRP for a second, third, etc. year?

o How much staff time does it take to administer this program?

1. A lot, a little, etc.

2. Several staff members, very few staff members, etc.

6. How is the SLRP funded?

o At what level is the funding provide?

15

1. National, Regional, etc.

o How is the decision made to increase/decrease the amount of funding?

o Are their any budgetary constraints that may cause a problem in sustaining the program?

Program Outcomes

7. What changes and/or improvements if any have been made to the SLRP since you first began

using it?

o Is the program growing, shrinking, etc?

o Have the goals of the program been fulfilled?

o What improvements if any are being made to the SLRP?

o What challenges if any have been experienced with the program?

8. Are there any established performance measures or metrics for the program?

o If so, tell me about them.

o What do the results show?

9. Are employees in the SLRP completing their 3-year commitments to the program?

o If so, how many times?

o If not, how many times?

o Have some people declined the program due to the 3-year commitment?

10. Has the applicant pool increased since starting the SLRP?

11. Is there anything else we have not talked about regarding the SLRP that you believe is important

for me to understand how this program operates at your organization?

12. May I reserve the right to call you back?

16

Appendix C: Case Study Summaries

Governmental Accountability Office


National Mediation Board

Department of State

Agency of International Development

Export-Import Bank

Farm Credit Administration


17


Year Established: 2002 Program Highlight: Annual Application

# SLRP Employees (2008): 362 # of FTE’s (2008): 3,129

Avg. Individual Allocation (yearly): $4,945 Avg. Annual Agency SLRP Budget: $1,285,014

Background

GAO began using the Student Loan Repayment

Program in 2002. In 2008, GAO was recorded as

having 12% of its 3,129 employees actively

using the SLRP with $2,095,584 of support for

the program. Although GAO uses SLRP for both

recruitment and retention, the primary goal of

the program is to retain highly qualified

employees.

Policy & Structure

At GAO, all employees are eligible to apply to

the program. Similar to OPM’s policy, GAO

requires a 3-year service commitment to be

signed for new recruits to the agency. Consistent

with the OPM policy the maximum an employee

can receive is $10,000/year with a $60,000

maximum total. The SLRP is used as a retention

tool once current employees have already

completed their 3-year requirement. In this case,

employees are required to reapply every year in

order to receive the payment.

GAO has two categories of employees: general

category and special category employees.

Special category employees are employees with

exceptional qualifications/experience or

employees in hard to fill positions. Special

category employees tend to receive higher SLRP

allocations.

Program Administration GAO’s selection process is very complex due to

program size, employee categories, and security

checks. Every year there is an open period of 1

month, usually in May, for the employees to

apply for the program. Applications are

evaluated, and security checks are conducted to

ensure that the each employee’s loans meet the

requirements of the SLRP policy, i.e. not being

in default, the loan is federally insured etc.

Once the qualified employees are identified, the

supervisor of their unit and the Human

Resources staff evaluates employees and their

applications. Positions are evaluated based on

agency need and employee qualifications.

Employee supervisors and HR staff determine

the amount of money distributed. Typically, all

employees who are deemed eligible are afforded

the program as long as funding is available.

Due to the constraints on the types of loans that

are repaid, background investigations are

completed every year for every employee even if

an employee previously used the program. This

adds to the amount of time it takes to select the

awardees. It makes for a very hard

administrative task because of the amount of

time and effort it takes to run the program.

Effectiveness

GAO noted a 97% growth rate in their program

from 2005 to 2008. They also noted that close to

100% of the employees who are afforded the

incentive stay through the service commitment,

which for the majority of employees is 1-year.

GAO is working to reduce the time it takes to

advertise to the program and conduct the

security clearances. These time consuming steps

seem to slow down the process. Time is critical

because loan payments given at the end of the

year can have major tax implications for

employees using the program.

Since the SLRP allocation is taxed, employees

are held accountable for their allocation as

taxable income. Lump-sum payments allocated

at the end of the year will likely skew an

employee’s taxable income from year to year

causing them to pay more or less taxes

depending on when the allocation is given.

18


Year Established: 2004 Program Highlight: Mission Critical Positions


Avg. Individual Allocation (yearly): $9,506 Avg. Annual Agency SLRP Budget: $228,142

Background

Department of Transportation started its

program in 2004 as a way to recruit and retain

highly qualified employees and fill hard to fill

positions. The program started with 6 employees

with about $53,000 in funding and has grown to

37 employees with just above $360,000 in

funding in 2008. DOT accounted for

approximately 56,000 employees in 2008. They

have less that 1% of the total number of

employees using SLRP. Other hiring incentives

include relocation bonuses and tuition

reimbursement.

Policy & Structure

Department of Transportation’s policy follows

very closely to OPM’s policy with the 3-year

service commitment. Their policy states that the

incentive is used to hire employees with

exceptional qualifications.

The following criteria must be met in order for

an employee to apply for the SLRP:

Employee must be in a non-temporary

position.

Loan repayments must be based on written

determination that, in the absence of

offering loan repayment benefits, it would

be difficult to either fill the position with a

highly qualified candidate (recruitment

action), or retain a highly qualified

employee in the position (retention action).

The candidate or employee must sign a

mandatory service agreement of 3-years.

Program Administration

The Department of Transpiration SLRP has

agency level oversight with regional autonomy.

All employees are eligible to apply for the

incentive, based on the requirements set by the

program. However, exceptional qualifications

are typically required in order to receive the

incentive upon recruitment.

Effectiveness

DOT notes that the SLRP helps to retain

employees better than other incentives, but

without performance, metrics to support the

claim there is no way to verify. DOT also states

that approximately 80% of the recipients fulfill

their 3-year commitment.

19

National Mediation Board

Year Established: 2004 Program Highlight: Hard to fill positions

# SLRP Employees (2008): 0 # of FTE’s (2008): 49

Avg. Individual Allocation (yearly): $0 Avg. Annual Agency SLRP Budget: $0

Background

The National Mediation Board’s SLRP began in

2003. The primary goal of the program is to

attract and retain highly qualified candidates for

hard to fill positions. Currently the SLRP has no

active participants and the program was not

offered in 2008. Other agency incentives include

moving expenses and retention allowances.

Policy & Structure

Similar to the OPM policy, National Mediation

Board requires a 3-year service commitment.

The program is offered to recruit and retain

employees who are in hard to fill positions.


The National Mediation Board’s program is

administered at the National Level. Supervisors

put in a request to HR to hire for a hard to fill

position with the SLRP. If the position is

deemed as hard to fill the HR Director approves

the request.

Effectiveness

The National Mediation Board used the SLRP to

help attract a few employees to hard to fill

positions. About 75% of the recipients of the

program stayed and completed the 3-year

commitment. The program started with 4

employees using the program with very little

funding and funding has been reduced over the

past 4 years. All of the original service

commitments have been fulfilled and have not

been renewed.

20

Department of State



Avg. Individual Allocation (yearly): $5,230 Avg. Annual Agency SLRP Budget: $3,599,974

Background

The Department of State’s SLRP was offered as

a two-year pilot program in FY 2002 and has

continued to be offered annually. The program

supports the recruitment and retention efforts of

both Civil Service and Foreign Service

employees in positions identified as either hard-

to-fill (FY 2002 – 2006) or employees in

positions identified as mission critical. Currently

the program provides SLRP incentive to just

fewer than 2% of the agencies total population

with about a $3.6 million annual investment.

Policy & Structure

Based on the State Department’s policy,

employees who wish to be considered for the

SLRP incentive must meet the qualifications for

the program based on the OPM Standard.

All policy guidelines are disseminated in

frequent Department Notices, telegrams to

overseas posts, a listserv and in the Foreign

Affairs Manual and Handbook. Each qualifying

employee benefits from the same amount unless

the outstanding loan balance is less than that

amount.

Program Administration The State Department’s SLRP is centrally

managed (in house) by the Bureau of Human

Resources, Office of Employee Relations in

Washington, D.C. Individual applications must

be submitted once a year during the designated

“open season” application period, usually April

through August. Since SLRP is available to a

limited eligibility pool throughout the agency,

authority is delegated to the Director General of

the Foreign Service and Director of Human

Resources, who delegate administration of the

program of the Office of Employee Relations.

All communication and most aspects of program

management is the responsibility of the

Employee Relations Office. Payments are

initiated by the State Department’s Domestic

Payroll Center with actual checks processed to

the lenders of each employee by the U.S.

Department of Treasury. Eligibility guidelines

are reviewed and adjusted annually as the needs

of the State Department dictate in keeping with

their recruitment and retention efforts, and the

funding available to support this program. Civil

Service employees encumbering approximately

twenty (20) different occupational series and

Foreign Service employees serving abroad at

extreme hardship and danger pay posts may

qualify if other eligibility factors are met.

Effectiveness

Since 2002, 145 employees have resigned while

subject to either the three-year or additional one-

year commitments. Three surveys conducted

since 2002 established that employees consider

the SLRP as having significant impact on their

decision to either request assignments to

extreme hardship posts or to continue their

employment with this agency. Based on the

surveys, 80% of those surveyed report that the

benefit has positively affected their decision to

stay employed by the agency. Each year with the

exception of 2007, the program numbers have

expanded to accommodate increased hiring

ratios over attrition. In 2002, 408 employees

qualified at a gross payout level of $4,700 per

person. In 2008, 713 employees qualified at an

announced incentive level of $5,230 per person.

In addition to the periodic surveys, performance

metrics have been established which focus on

eligibility as it relates to the agency’s mission

critical occupations; the number of resignations

by employees subject to the mandatory three-

year service commitment or additional service

commitment periods; and the impact of SLRP

upon assignment selections especially by

Foreign Service employees.

21

Agency of International Development




Background

The Agency of International Development’s

SLRP began in 2005. The primary goal of the

program is to help recruit and retain hard to fill

and mission critical positions. Currently the

program provides the SLRP incentive to about

5% of its 2,515 employees.

Policy & Structure

Similar to OPM’s policy, employees must sign a

service commitment of three years. In order to

continue receiving the SLRP employees who

have already used the SLRP for 3-years must

reapply. Each additional year of participation

will require the employee to add a one-year

extension to his or her existing service

commitment.


The Chief Human Capital Officer administers

AID’s SLRP at their National Headquarters. The

incentive is typically advertised and offered to

students through local university partnerships.

Employees who are hired through other means

are automatically eligible upon meeting the

criteria.

The National Office of Human Resources

administers AID’s SLRP. Since employees have

to apply to the program, it is not offered by

anyone but is assessed by employees in the

Human Resources office. The incentive is

advertised during the Open Season application

period, which runs from about the beginning of

April until the middle of July. After all

applications are submitted, the Program

Managers from the HR office review the

applications and make the selections. Employees

must fill out an application form and attach a

signed service agreement. Employees must also

provide supporting loan documentation that

meets the loan eligibility requirements as state in

the OPM policy.

Effectiveness

The payout process has been streamlined by a

form letter used to capture all of the financial

information up front. Currently the program is

growing year by year. AID has a specific

program called the Development Leadership

Institute where they are trying to increase the

leadership corps within the Foreign Service. The

SLRP has worked tremendously as an additional

recruitment tool in getting people to sign up not

just to be with the agency temporarily but also to

stay with the agency given the three-year service

agreement.

One challenge of the program is getting

responses back from the employee or lender that

they have not received payments for the loans.

AID is in process of establishing performance

metrics established.

22

Export-Import Bank

Year Established: 2002 Program Highlight: Different Amount Totals



Background

The Export-Import Bank’s SLRP began in 2002.

The primary goal of the program is to attract and

retain highly qualified candidates for hard to fill

positions. Currently the program only has 1

person using the incentive based on a prior 3-

year service commitment. The program has not

been offered in the last 2 years. Other agency

incentives include tuition reimbursement.

Policy & Structure

Similar to the OPM policy, Export-Import Bank

requires a 3-year service commitment. The

program is offered to recruit and retain

employees who are in hard to fill positions. The

maximum annual allotment is $6,000/year with a

$40,000 total, which is $20,000 less than the

OPM standard.


Export-Import Bank’s program is administered

at the National Level. Supervisors are able to

choose positions that they fill are hard to fill

positions with approval of HR office.

Supervisors provide documentation to HR staff

where applications are reviewed and the HR

Director then gives approval.

Effectiveness

Export-Import Bank’s SLRP has been declining

since the first year of use and is no longer

actively using the program. Very little funding

and support has been provided for the program.

The program is believed to have been successful

because it allowed the agency to staff a hard to

fill position. Currently the agency uses other

incentives instead of the SLRP.

23

Farm Credit Administration

Year Established: 2005 Program Highlight: 1-time payment only



Background

The Farm Credit Administration has been using

the SLRP since 2005 and still actively using the

program. In 2008, Farm Credit Administration

recorded 4% of its 256 employees actively using

the SLRP with $55,902 of support for the

program. The primary goal of the program is a

recruitment tool to recruit recent graduates into

entry-level positions. Other incentives include

$1,300 flexible spending for health or childcare;

crediting annual leave and 80% health benefits

coverage versus the typical 70%. Bank examiner

applicants are most commonly offered the

incentive because they are required to go

through a rigorous 2-year probationary training

program.

Policy & Structure

Based on the FCA’s policy, employees who

wish to be considered for the SLRP incentive

must meet the following criteria:

They must have a federally insured loan

balance that is not in default.

They have to have federal loans that accrued

while completing a degree

The employees do not have to apply for SLRP;

rather they are automatically qualified and

considered for the benefit. At FCA, employees

are only given a one-time $9,000 SLRP. One-

third of the money is given at the start of the first

year, then another third in the middle of the first

year and the last payment is given at the start of

the 2nd

year. Employees must stay with the

agency until at least the start of their 2nd

year in

order to receive the entire $9,000 incentive.

Employees are unable to reapply for the program

once they have already received the incentive.

FCA does not follow the OPM’s SLRP policy

because of a special authority. As a federal

regulator, FCA uses their SLRP based on section

5.11(c)(2)(A) of the Farm Credit Act of 1971.

Based on the Farm Credit Act, the Chairman of

the Farm Credit Administration may set and

adjust the rates of basic pay for FCA employees

without regard to the provisions of chapter 51 or

subchapter 888 of chapter 53, of title 5, United

States Code. FCA may also provide additional

compensation and benefits as necessary to

maintain comparability with the total amount of

compensation and benefits provided by other

Federal bank regulatory agencies (FBRAs). FCA

is able to augment its salary structure to provide

for sign on and retention bonuses, student loan

repayment as well as other programs recruitment

and retention incentives.


The Chief Human Capital Officer administers

the FCA’s SLRP at their National Headquarters.

Any HR official is able to offer the incentive;

the employee just has to meet the minimum

requirements for student loan repayment. The

incentive is typically advertised and offered to

students through local university partnerships.

Employees who are hired through other means

are automatically qualified upon meeting the

criteria.

Effectiveness

FCA’s program does not require many staff

hours because of the size of the program. No

performance metrics have been established to

measure effectiveness or attrition in the

program. Almost all employees accept the

incentive when offered with the exception of a

few from time to time. FCA is unsure as to why

applicants may decline the offer. FCA noted that

about 80% of the individuals who accept the

incentive stay. Once again, it is not clear if the

cause is due to the SLRP, the agency or the

rigors of the job. It is also worth noting that

FCA has not considered using the SLRP as a

retention tool.

24


Year Established: 2005 Program Highlight: Up to 7 year commitment



Background

The Department of Commerce has been using

the SLRP since 2005 and is still actively using

the program. In 2008, DOC reported only 10

employees out of 39,220 using the SLRP

incentive. The primary goal of the program is a

recruitment and retention tool for hard to fill and

mission critical positions. The agency also offers

relocation bonuses, retention bonuses, and

recruitment bonuses more frequently than the

SLRP incentive.

Policy & Structure

Similar to OPM’s policy the Department of

Commerce’s policy requires the 3-year service

agreement for employees using the SLRP

incentive. DOC has specific criteria for the

SLRP as it relates to recruitment and retention.

For Recruitment:

1. The candidate must possess qualifications

which meet an important need of the

operating unit, as determined by the

operating unit director;

2. The candidate would not accept the position

without receiving the SLRP incentive;

3. The candidate is not in default on repayment

of the student loan; and

4. The student loan was used to pay tuition and

related expenses for course work.

For Retention:

1. The operating unit determines that the

employee possesses high or unique

qualifications or meets a special need of the

operating unit;

2. In the absence of offering the student loan

repayment benefit, the employee would very

likely leave for employment outside of

DOC; and

3. The departure of the employee would affect

the agency's ability to carry out an activity

or function deemed essential to the agency's

mission.

In contrast to OPM’s policy, the service length

requirement for employees who receive $20,000

must stay for the 3-year service commitment

with every additional $10,000 adds another year

of commitment up to 7 years required years.

That scenario assumes the maximum payout of

$10,000 per year. If a lesser amount is given, the

total number of years can be increased up to 15

years with the maximum being $60,000 total.


Heads of operating units are delegated the

authority to make the determination to repay a

student loan as a recruitment or retention

incentive. This authority may be further

delegated as needed. Each operating unit

advertises the incentive or decides to select a

hard to fill position to fill. The national HR

office must review and approve the selection

before loan repayment is authorized.

Effectiveness

DOC has yet to establish any performance

metrics for the SLRP. SLRP tends to be used as

a last resort for recruitment and retention as

other incentives are used more commonly. DOC

noted that the SLRP was highly successful at

helping to fill hard to fill positions and retain

employees who would otherwise leave. They

noted that 90% of employees using the incentive

stay for the required 3-year service commitment.

Appendix D: Quantitative Analysis

SLRP Data Summary

SLRP 2008

SLRP 2007

SLRP 2006

SLRP 2005

SLRP 2004

SLRP 2003

SLRP 2002

Agency Avg. SLRP Allocation Avg. Individual Allocation Program Use (Years)

Total SLRP

Employees

Agency for International Development $512,523 $6,529 2 157

Chemical Safety and Hazard Investigation Board $16,000 $5,333 2 6

Committee for Purchase from Severely Disabled $16,667 $7,143 3 7

Defense Nuclear Facilities Safety Board $23,773 $7,924 7 21

Department of Agriculture $156,076 $7,094 7 154

Department of Commerce $31,163 $7,332 4 17

Department of Defense $3,985,906 $4,113 7 6,783

Department of Education $32,943 $4,597 6 43

Department of Energy $258,883 $5,178 7 350

Department of Health and Human Services $608,313 $6,643 7 641

Department of Homeland Security $369,955 $7,956 4 186

Department of Housing and Urban Development $483,249 $2,551 5 947

Department of Interior $258,732 $6,860 7 264

Department of Justice $10,608,254 $8,597 7 8,638

Department of Labor $83,507 $5,010 6 100

Department of State $3,599,974 $5,230 7 4,818

Department of Transportation $228,142 $9,506 5 120

Department of Treasury $137,093 $5,187 7 185

Department of Veterans Affairs $641,077 $7,097 6 542

Environmental Protection Agency $88,814 $5,843 5 76

Export-Import Banks $38,694 $6,110 6 38

Farm Credit Administration $55,902 $4,300 4 52

Federal Energy Regulatory Commission $603,640 $8,606 7 491

Federal Housing Finance $51,097 $9,017 3 17

Federal Trade Commission $20,000 $10,000 1 2

General Services Administration $110,422 $6,135 7 126

Government Accountability Office $1,285,014 $4,945 7 1,819

Government Printing Office $141,448 $7,132 6 119

Inter-American Foundation $6,000 $6,000 6 6

International Trade Commision $25,000 $10,000 2 5

Library of Congress $15,333 $7,667 3 6

National Aeronautics and Space Administration $201,651 $7,352 7 192

National Archives and Records Administration $88,200 $7,000 5 63

National Mediation Board $17,134 $4,509 5 19

Nuclear Regulatory Commission $129,091 $9,332 6 83

Office of Personnel Management $679,745 $8,476 5 401

Office of Special Counsel $132,968 $8,865 3 45

Pension Benefit Guaranty Corporation $200,042 $9,093 1 22

Securities and Exchange Commission $3,107,950 $8,571 5 1,813

mean 744,881 6,893 5 753

median 137,093 7,094 6 119

mode - - 7 -

min 6,000 2,551 1 2

max 10,608,254 10,000 7 8,638

Agency Number of Employees 2008 SLRP $ Allocation Avg. Individual Allocation % of SLRP Employees

Agency for International Development 2,515 825,045$ 7,237$ 4.53%

Chemical Safety and Hazard Investigation Board 37 30,000$ 6,000$ 13.51%

Committee for Purchase from Severely Disabled 29 -$ -$ 0.00%

Defense Nuclear Facilities Safety Board 94 10,000$ 10,000$ 1.06%

Department of Agriculture 82,437 364,602$ 7,596$ 0.06%

Department of Commerce 39,220 75,045$ 7,505$ 0.03%

Department of Defense 669,103 7,797,349$ 6,063$ 0.19%

Department of Education 4,160 16,000$ 5,333$ 0.07%

Department of Energy 15,215 514,488$ 4,900$ 0.69%

Department of Health and Human Services 64,072 2,281,581$ 7,950$ 0.45%

Department of Homeland Security 175,172 603,684$ 7,546$ 0.05%

Department of Housing and Urban Development 8,868 690,869$ 2,752$ 2.83%

Department of Interior 67,528 419,841$ 6,997$ 0.09%

Department of Justice 110,032 23,420,746$ 8,973$ 2.37%

Department of Labor 16,238 22,005$ 7,335$ 0.02%

Department of State 36,472 4,593,282$ 6,442$ 1.95%

Department of Transportation 55,810 362,500$ 9,797$ 0.07%

Department of Treasury 88,245 234,252$ 4,593$ 0.06%

Department of Veterans Affairs 283,491 1,047,310$ 8,056$ 0.05%

Environmental Protection Agency 18,249 85,250$ 5,683$ 0.08%

Export-Import Banks 368 6,000$ 6,000$ 0.27%

Farm Credit Administration 256 40,628$ 3,693$ 4.30%

Federal Energy Regulatory Commission 1,079,826$ 9,556$ -

Federal Housing Finance 135 36,575$ 9,144$ 2.96%

Federal Trade Commission 1,131 20,000$ 10,000$ 0.18%

General Services Administration 12,021 398,890$ 6,233$ 0.53%

Government Accountability Office 3,129 2,095,584$ 5,789$ 11.57%

Government Printing Office 2,378 60,000$ 10,000$ 0.25%

Inter-American Foundation 39 -$ -$ 0.00%

International Trade Commission 372 -$ -$ 0.00%

Library of Congress 3,871 10,000$ 10,000$ 0.03%

National Aeronautics and Space Administration 18,455 35,363$ 5,052$ 0.04%

National Archives and Records Administration 3,202 153,977$ 6,695$ 0.72%

National Mediation Board 49 -$ -$ 0.00%

Nuclear Regulatory Commission 4,088 191,418$ 9,115$ 0.51%

Office of Personnel Management 5,433 34,000$ 8,500$ 0.07%

Office of Special Counsel 119 210,000$ 10,000$ 17.65%

Pension Benefit Guaranty Corporation 908 200,042$ 9,093$ 2.42%

Securities and Exchange Commission 3,664 3,701,771$ 9,073$ 11.14%

Agency Number of Employees 2007 # of SLRP employees 2007 SLRP $ Allocation Avg. Individual Allocation % of SLRP Employees

Agency for International Development 2,515 0 -$ -$ 0.00%

Chemical Safety and Hazard Investigation Board 38 0 -$ -$ 0.00%

Committee for Purchase from Severely Disabled 30 0 -$ -$ 0.00%

Defense Nuclear Facilities Safety Board 92 2 14,000$ 7,000$ 2.17%

Department of Agriculture 98,523 53 404,173$ 7,626$ 0.05%

Department of Commerce 40,380 3 19,605$ 6,535$ 0.01%

Department of Defense 673,654 1,860 6,283,433$ 3,378$ 0.28%

Department of Education 4,173 4 21,950$ 5,488$ 0.10%

Department of Energy 14,601 68 460,150$ 6,767$ 0.47%

Department of Health and Human Services 61,403 144 1,105,910$ 7,680$ 0.23%

Department of Homeland Security 162,120 71 554,711$ 7,813$ 0.04%

Department of Housing and Urban Development 9,498 179 598,165$ 3,342$ 1.88%

Department of Interior 65,099 41 339,967$ 8,292$ 0.06%

Department of Justice 107,405 2,463 20,559,523$ 8,347$ 2.29%

Department of Labor 12,244 36 190,033$ 5,279$ 0.29%

Department of State 35,651 626 3,741,935$ 5,978$ 1.76%

Department of Transportation 54,144 36 332,151$ 9,226$ 0.07%

Department of Treasury 107,872 26 132,985$ 5,115$ 0.02%

Department of Veterans Affairs 260,261 129 995,401$ 7,716$ 0.05%

Environmental Protection Agency 17,964 14 78,368$ 5,598$ 0.08%

Export-Import Banks 359 0 -$ -$ 0.00%

Farm Credit Administration 250 14 60,283$ 4,306$ 5.60%

Federal Energy Regulatory Commission 42 397,504$ 9,464$ -

Federal Housing Finance 139 7 66,576$ 9,511$ 5.04%

Federal Trade Commission 1,131 0 -$ -$ 0.00%

General Services Administration 11,861 9 69,094$ 7,677$ 0.08%

Government Accountability Office 3,089 316 1,641,935$ 5,196$ 10.23%

Government Printing Office 2,309 6 49,785$ 8,298$ 0.26%

Inter-American Foundation 44 1 6,000$ 6,000$ 2.27%

International Trade Commision 365 3 30,000$ 10,000$ 0.82%

Library of Congress 3,821 2 15,000$ 7,500$ 0.05%

National Aeronautics and Space Administration 18,330 38 258,169$ 6,794$ 0.21%

National Archives and Records Administration 2,991 21 146,324$ 6,968$ 0.70%

National Mediation Board 48 4 20,695$ 5,174$ 8.33%

Nuclear Regulatory Commission 3,729 15 137,882$ 9,192$ 0.40%

Office of Personnel Management 5,311 6 20,000$ 3,333$ 0.11%

Office of Special Counsel 104 11 66,000$ 6,000$ 10.58%

Pension Benefit Guaranty Corporation 880 0 -$ -$ 0.00%

Securities and Exchange Commission 3,513 369 3,390,076$ 9,187$ 10.50%











Department of Health and Human Services 60,512 58 371,525$ 6,406$ 0.10%











Export-Import Banks 370 3 18,000$ 6,000$ 0.81%



Federal Housing Finance 134 6 50,139$ 8,357$ 4.48%



Government Accountability Office 3,198 286 1,396,538$ 4,883$ 8.94%



International Trade Commision 371 2 20,000$ 10,000$ 0.54%

Library of Congress 3,967 3 21,000$ 7,000$ 0.08%






Office of Special Counsel 107 13 122,904$ 9,454$ 12.15%




Agency for International Development 2,142 43 200,000$ 4,651$ 2.01%





















Farm Credit Administration 271 0 -$ -$ 0.00%


Federal Housing Finance 104 0 -$ -$ 0.00%



Government Accountability Office 218 1,170,876$ 5,371$ -



International Trade Commision 356 0 -$ -$ 0.00%

Library of Congress 4,090 0 -$ -$ 0.00%






Office of Special Counsel 100 0 -$ -$ 0.00%






Committee for Purchase from Severely Disabled 26 2 20,000$ 10,000$ 7.69%



Department of Commerce 31,316 0 -$ -$ 0.00%

Department of Defense 628,897 702 3,079,228$ 4,386$ 0.11%




Department of Homeland Security 135,971 0 -$ -$ 0.00%



Department of Justice 100,234 331 1,919,412$ 5,799$ 0.33%









Federal Energy Regulatory Commission 78 703,831$ 9,023$




Government Accountability Office 237 1,142,295$ 4,820$









Office of Personnel Management 2,505 384 3,293,727$ 8,577$ 15.33%



Securities and Exchange Commission 3,408 0 -$ -$ 0.00%



Chemical Safety and Hazard Investigation Board 38 1 2,000$ 2,000$ 2.63%




Department of Commerce 31882 0 -$ -$ 0.00%

Department of Defense 629030 469 1,309,247$ 2,792$ 0.07%

Department of Education 4414 2 12,000$ 6,000$ 0.05%

Department of Energy 15481 27 149,855$ 5,550$ 0.17%

Department of Health and Human Services 59475 38 130,323$ 3,430$ 0.06%

Department of Homeland Security 144787 0 -$ -$ 0.00%

Department of Housing and Urban Development 10369 0 -$ -$ 0.00%

Department of Interior 68161 20 113,015$ 5,651$ 0.03%

Department of Justice 98195 160 688,149$ 4,301$ 0.16%

Department of Labor 15486 11 59,000$ 5,364$ 0.07%

Department of State 19212 660 3,234,602$ 4,901$ 3.44%

Department of Transportation 57981 0 -$ -$ 0.00%

Department of Treasury 122700 10 64,150$ 6,415$ 0.01%

Department of Veterans Affairs 201993 46 211,329$ 4,594$ 0.02%

Environmental Protection Agency 17100 0 -$ -$ 0.00%





Federal Trade Commission 997 0 -$ -$ 0.00%

General Services Administration 12766 14 75,711$ 5,408$ 0.11%

Government Accountability Office 231 945,206$ 4,092$ -

Government Printing Office 2978 44 253,224$ 5,755$ 1.48%



Library of Congress 4062 0 -$ -$ 0.00%

National Aeronautics and Space Administration 18508 10 34,000$ 3,400$ 0.05%

National Archives and Records Administration 2586 0 -$ -$ 0.00%


Nuclear Regulatory Commission 2851 5 30,000$ 6,000$ 0.18%

Office of Personnel Management 2524 0 -$ -$ 0.00%



Securities and Exchange Commission 2939 257 1,462,450$ 5,690$ 8.74%

Agency Number of Employees 2002 # of SLRP employees 2002 SLRP $ Allocation Average Loan Repayment Amount % of SLRP Employees

Agency for International Development 2137 0 -$ -$ 0.00%




Department of Agriculture 91278 2 $ 8,524 4,262$ 0.00%

Department of Commerce 31,708 0 -$ -$ 0.00%

Department of Defense 65782 6 11,839$ 1,973$ 0.01%

Department of Education 4,492 0 -$ -$ 0.00%



Department of Homeland Security 0 -$ -$ -

Department of Housing and Urban Development 9,918 0 -$ -$ 0.00%


Department of Justice 125,127 1 4,000$ 4,000$ 0.00%

Department of Labor 15,702 0 -$ -$ 0.00%


Department of Transportation 66,421 0 -$ -$ 0.00%


Department of Veterans Affairs 199,191 0 -$ -$ 0.00%

Environmental Protection Agency 16,983 0 -$ -$ 0.00%







Government Accountability Office 169 602,662$ 3,566$ -

Government Printing Office 2,974 0 -$ -$ 0.00%





National Archives and Records Administration 2,586 0 -$ -$ 0.00%

National Mediation Board 48 0 -$ -$ 0.00%

Nuclear Regulatory Commission 2,723 0 -$ -$ 0.00%

Office of Personnel Management 2,550 0 -$ -$ 0.00%



Securities and Exchange Commission 2,960 0 -$ -$ 0.00%

Appendix E: Agency Policies



Order 2537.1

U.S. Government Accountability Office

May 13, 2009

Subject: GAO STUDENT LOAN REPAYMENT PROGRAM

Chapter 1. Introduction ..........................................................................................................2 1. Purpose, Scope, and Applicability. ..................................................................2 2. Supersession. ....................................................................................................2 3. References. .......................................................................................................2 4. Background. .....................................................................................................2 5. Coverage...........................................................................................................2 6. Annual Plan. .....................................................................................................2 7. Adherence to Merit System Principles.............................................................2 8. Definitions. .......................................................................................................3

Chapter 2. Program Criteria, Conditions and Responsibilities .........................................3 1. Eligibility for Loan Repayments. .....................................................................3 2. Criteria for Loan Repayments. .........................................................................3 3. Recommendation and Approval of Loan Repayments. ...................................4 4. Conditions of Loan Repayments. .....................................................................4 5. Amount of Repayments and Limitations. ........................................................4 6. Method of Loan Repayments. ..........................................................................5 7. Service Agreements..........................................................................................5 8. Loss of Eligibility for Loan Repayments. ........................................................5 9. Employee Reimbursements to the Government...............................................5 10. Employee Responsibilities. ..............................................................................6

Distribution:

Initiated by: Human Capital

Office

2537.1 May 13, 2009

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Chapter 1. Introduction 1. Purpose, Scope, and Applicability.

This order contains the policies and procedures for the review and approval of the repayment of student loans in order to facilitate the recruitment or retention of highly qualified employees. The option of repaying all or part of a student loan provides an incentive for a candidate to accept a Government Accountability Office (GAO) position which would otherwise be difficult to fill or to retain a highly competent employee with knowledge or skills critical to GAO.

2. Supersession.

This order supersedes GAO Order 2537.1, Repayment of Student Loans, dated September 22, 2006. Revisions have been made to incorporate changes to 5 C.F.R. part 537. GAO’s program must be consistent with these regulations.

3. References.

a. 5 U.S.C. Section 5379.

b. 5 C.F.R. part 537.

c. 5 C.F.R. part 353.

d. GAO Order 0254.1, Debt Collection.

e. GAO Order 2353.1, Reemployment Rights of Members of the Uniformed Services.

f. GAO Order 2810.1, Line-of-Duty Injury Benefits for GAO Employees Under the Federal Employees’ Compensation Act.

4. Background.

Section 5379, title 5, United States Code, authorizes agencies, including GAO, to repay (by direct payment to the loan holder on behalf of the employee) all or part of an outstanding student loan to facilitate the recruitment or retention of highly qualified employees. GAO may repay up to a maximum of $10,000 per employee per calendar year up to a lifetime maximum of $60,000. Depending on funding resources and hiring and retention needs, GAO may determine that no incentive, or less than the annual maximum, will be paid in any year.

5. Coverage.

A candidate or employee must occupy a covered position identified in GAO’s annual plan (see paragraph. 6) in order to be recommended or approved for loan repayments.

6. Annual Plan.

HCO shall issue an annual plan specifying the positions eligible for loan repayments for recruitment and retention purposes, the loan repayment amounts, and the recommendation and approval procedures for loan repayments.

7. Adherence to Merit System Principles.

May 13, 2009 2537.1

3

When recommending and selecting candidates or employees to receive loan repayment benefits, management officials should adhere to merit system principles and consider the need to maintain a balanced workforce in which women and members of racial and ethnic minority groups are appropriately represented in government service.

8. Definitions.

a. “Student loan” means a loan made, insured, or guaranteed under parts B, D, or E of title IV (Student Assistance) of the Higher Education Act of 1965; or a health education assistance loan made or insured under part A of title VII of the Public Health Service Act, or under part E of title VIII of that act.

b. “Service agreement” means a written agreement between GAO and a candidate or employee under which the individual agrees to a specified period of employment with GAO of not less than 3 years, in return for repayments toward a student loan previously obtained by the candidate or employee. The specified period of service begins September 30, XXXX (of the given fiscal year) and ends September 30, XXXX (3 years later).

Chapter 2. Program Criteria, Conditions and Responsibility

1. Eligibility for Loan Repayments.

Student loan repayments may be approved to recruit or retain

a. temporary employees who are serving on appointments leading to conversion to permanent appointments;

b. term employees with at least 3 years remaining on their appointment; or

c. permanent employees.

2. Criteria for Loan Repayments.

a. Recruitment considerations. In order to be recommended and approved to receive a loan repayment for recruitment purposes, the candidate must

(1) have an outstanding student loan and must not have defaulted on the student loan prior to or during the period of the agreement with GAO; and

(2) be recommended in writing, for a loan repayment based on the fact that

(a) in the absence of such repayments, GAO would encounter difficulty in filling the position with a highly qualified candidate, and

(b) the individual is highly qualified and otherwise eligible for the position being recruited.

b. Retention considerations. In order to be recommended and approved to receive a loan repayment for retention purposes, the employee must

(1) have an outstanding student loan and must not have defaulted on the student loan prior to or during the period of the agreement with GAO;

2537.1 May 13, 2009

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(2) be recommended by his or her managing director, in writing, for a loan repayment based on the fact that the high or unique qualifications of the employee or special needs of GAO for the employee’s services makes it essential to retain the employee, and that, in the absence of such repayments, the employee would be likely to leave for employment outside of GAO;

(3) have completed any specified period of service with GAO by the effective date of the annual open application period; and

(4) have appraisal ratings for the most recent appraisal cycle of “meets expectations” or higher on all competencies.

3. Recommendation and Approval of Loan Repayments.

a. Recommending and approving officials. Managing directors/unit heads will recommend job candidates or employees for the repayment of student loans and the Chief Human Capital Officer (CHCO) will approve or disapprove the recommendations. Unless GAO specifies the amount of a repayment in advance, the managing director/unit head also will recommend the repayment amount for each student loan subject to the limits set forth in paragraph 5. The CHCO will approve, disapprove, or modify repayment amounts.

b. Consideration of other recruitment and retention incentives. In lieu of a loan repayment, management officials may consider other recruitment and retention incentives such as a superior qualifications appointment, a recruitment bonus or retention allowance, or reimbursement for job-related educational expenses.

4. Conditions of Loan Repayments.

Repayments will be at the discretion of GAO and are subject to such terms, limitations, or conditions as agreed to by GAO and the candidate or employee concerned. Repayments may be applied only to the indebtedness outstanding at the time GAO and the candidate or employee enters into a service agreement. Repayments are subject to the availability of fiscal year-appropriated funds.

5. Amount of Repayments and Limitations.

a. GAO’s annual plan will establish annual guidelines on the size of loan repayments, but amounts paid by GAO are subject to the following maximum limits: (1) $10,000 per employee per calendar year and (2) a lifetime aggregate of $60,000 per employee.

b. Using appropriate discretion, the CHCO may adjust the amount of loan repayments for any year or authorize an additional loan repayment for a subsequent year or years. These arrangements may be made part of the initial agreement with the employee. If the repayment is increased or renewed, the CHCO has the discretion to require an additional period of service beyond that set forth in paragraph 7b.

c. More than one loan may be repaid as long as the total for the loan repayments do not exceed any limits set forth in the HCO annual plan or the limits set forth in paragraph 5a.

d. In determining the size of the loan repayments, and whether the loan repayment should be adjusted or renewed, the following factors shall be considered: (1) the position involved, (2) the value of the candidate or employee to the organization, (3) the difficulty in recruiting the candidate or retaining the employee, (4) how far in advance GAO can obligate funds, and (5) budgetary constraints, if any.

May 13, 2009 2537.1

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6. Method of Loan Repayments.

a. All loan repayments (less applicable taxes) will be made directly to the holder of the loan on behalf of the employee.

b. Loan repayments for retention will be paid annually as a lump sum payment at the end of the fiscal year for which the authorization is given.

c. Any loan repayment for recruitment purposes will begin after the candidate enters on duty with GAO.

7. Service Agreements.

a. All recipients must sign a written service agreement to complete a specified period of employment with GAO and to reimburse GAO for loan repayment benefits as specified in paragraph 9.

b. The minimum period of employment to be established under a service agreement is 3 years, regardless of the amount of loan repayment authorized. The period can be increased at GAO’s discretion if the loan repayment is increased or renewed.

c. The service agreement also will specify the level of performance to be maintained and may specify any other conditions of employment GAO determines to be appropriate, such as, but not limited to, the employee’s position, the duties he or she is expected to perform, and work schedule.

d. With the exception of absence due to uniformed service or compensable injury, periods of leave without pay or other periods during which the employee is not in a pay status do not count toward completion of the required service period. Thus, the service completion date will be extended by the total amount of time in nonpay status. Each 8 hours of nonpay time shall extend the service completion date by 1 day.

e. A service agreement under this authority must specify that the agreement in no way constitutes a right, promise, or entitlement for continued employment or, if appropriate, noncompetitive conversion to a permanent appointment.

f. GAO may renew or increase the amount of any repayment authorized in any service agreement or extend the period of such repayment with or without requiring the employee to enter into a new service agreement.

8. Loss of Eligibility for Loan Repayments.

An employee receiving loan payment benefits will be ineligible for continued benefits if the employee

a. separates from GAO;

b. does not maintain, as required in the service agreement, the specified level of performance on the most recent performance appraisal of record;

c. violates any of the conditions of the service agreement; or

d. is determined by the CHCO to have defaulted on the student loan prior to or during the period of the agreement with GAO.

9. Employee Reimbursements to the Government.

2537.1 May 13, 2009

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a. Except as provided in paragraphs 9d and 9e, an employee who fails to complete the period of employment established under a service agreement will be indebted to the federal government and must repay to GAO the gross amount of any loan repayments made by GAO to a lending institution on behalf of the employee. Repayment is required even when an employee leaves GAO for employment in another federal agency.

b. Failure to complete the period of employment established under a service agreement occurs when the employee’s service with GAO terminates before completion of the period of employment specified in the service agreement because

(1) the employee is separated involuntarily on account of performance or misconduct, or a negative suitability determination; or

(2) the employee leaves GAO voluntarily, even if to take another position in the federal service.

c. If an employee fails to reimburse GAO the amount owed under paragraph 9a, a sum equal to the amount outstanding shall be recovered from the employee under applicable regulations for collection by offset from an indebted government employee, or governing debt collection if the individual is no longer a federal employee (see GAO Order 0254.1, Debt Collection).

d. An employee does not have to repay the amount of any student loan repayment made by GAO when the employee fails to complete a period of employment established under a service agreement because the employee is involuntarily separated for reasons other than performance or misconduct.

e. The Comptroller General may waive, in whole or in part, a right of recovery of an employee’s debt if he or she determines that recovery would be against equity and good conscience or against the public interest. Waivers of indebtedness under this program must be requested by the employee in writing to the CHCO (see GAO Order 0254.1, Debt Collection, ch. 8, Waiver).

10. Employee Responsibilities.

The employee is responsible for

a. making loan repayments on the portion of the loan that continues to be the responsibility of the employee;

b. paying any federal, state, and local income taxes and the employee’s share of applicable employment taxes resulting from the loan repayments (note: GAO will withhold applicable taxes through the National Finance Center (NFC) for any loan repayment);

c. notifying HCO (which processes loan payments through NFC) of any changes in

(1) outstanding student loan balance, and/or

(2) lending institution account number (i.e., specifically linked to employee’s student loan account number);

d. signing a service agreement as specified in paragraph 7; and

e. reimbursing GAO, as specified in paragraph 9, if he or she fails to complete the period of employment established under the service agreement.

http://dms.osec.doc.gov/cgi-bin/doit.cgi?226:112:0b3e8d8526d145b49503cd704e2246d7a03bc3fd68fbb9374c8b7450bcb4df26:1:247[4/6/10 12:20:57 AM]

DEPARTMENT OF COMMERCE REPAYMENT OF STUDENT LOANPOLICY

Number: DAO 202-957 Effective Date: 2005-06-03

SECTION 1. PURPOSE.

.01 Title 5 United States Code (U.S.C.) 5379 and accompanying regulations found at 5 Code ofFederal Regulations (CFR) 537, authorize agencies to repay student loans to recruit or retainhighly qualified professional, technical, or administrative personnel. This DepartmentAdministrative Order (DAO) further authorizes Department of Commerce (the Department)operating units to make such payments. Payments are to be made by direct payment to theeducational or lending institution on behalf of the employee and are not authorized asreimbursement to an employee for payments made by the employee prior to entering into aStudent Loan Repayment Service Agreement with the agency.

.02 This revision increases the annual and aggregate limits on student loan repayments byagencies, pursuant to changes made by Public Law (P.L.) 108-123.

SECTION 2. POLICY.

Heads of operating units are delegated the authority to make the determination to repay astudent loan as a recruitment or retention incentive. A total of up to $60,000.00 before taxesmay be repaid for any eligible employee. Payments are not to exceed $10,000 before taxes in acalendar year. This authority may be re-delegated by operating unit heads to appointing officialsdesignated in DAO 202-250. Heads of operating units or their designees must develop anoperating unit implementation plan which incorporates all the elements of this DAO and includesoperating unit specific elements, so long as those elements do not arbitrarily restrictparticipation in the program. The implementation plan, at a minimum, must identify approvingauthorities, and should further define the criteria in sections 6 and 7 that are specific to theoperating unit. These officials also have the authority to require employee reimbursement ofagency loan payments made on their behalf when one or more of the conditions apply asescribed in Section 12. of this Order.

SECTION 3. LABOR-MANAGEMENT RELATIONS.

In organizations where employees are represented by a labor organization accorded exclusiverecognition, management is obligated to notify the labor organization of its intent to implementthis policy and negotiate in good faith, as appropriate.

SECTION 4. COVERAGE.

.01 An operating unit may offer a student loan repayment incentive in order to fill a positionwith a highly qualified candidate or to retain a highly qualified employee. This incentive appliesto employees as defined in 5 U.S.C. 2105 serving in full or part-time positions including:

a. temporary employees serving on appointments leading to conversion as term or permanentappointments;

b. term employees with at least three years remaining on their appointment;

c. permanent employees, including employees serving on full-time excepted appointments underthe General Schedule, unless serving under a Schedule C appointment; and

d. employees serving on excepted appointments with conversion to term, career, or careerconditional appointments (including, but not limited to Career Intern or Presidential ManagementFellow appointments).

.02 Per 5 U.S.C. 5379(a) (2), a student loan may not be paid on behalf of an employeeoccupying a position excepted from the competitive service because of its confidential, policy-

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determining, policy-making, or policy-advocating character, such as Schedule C appointments.

SECTION 5. DEFINITIONS.

The terms referred to in the policy have the following meanings:

a. "Student Loan" means a loan made, insured, or guaranteed under parts B, D, or E of Title IVof the Higher Education Act of 1965 (as amended by the Higher Education Act of 1998, P.L. 105-244, October 7, 1998). This legislation covers major Federal student financial aid programsincluding (but not limited to) Stafford Loans, Supplemental Loans, Plus Loans, FederalConsolidation Loans, Defense Loans made before July 1, 1972, National Direct Student Loansmade between July 1, 1972, and July 1, 1987, and Perkins Loans. Also included are HealthEducation Assistance Loan Program loans, Nursing Student Loan Program loans, and HealthProfession Student Loan Program loans made or insured under the Public Health Service Act.

b. "Service Agreement" means a written agreement between the operating unit and anemployee under which the employee agrees to a specified period of employment within theDepartment of not less than three years but no more than 15 years, depending upon theamount of the reimbursement by the operating unit, in return for payments toward a studentloan previously taken out by the employee. The service agreement period begins when the firstpayment is made by the Department to the holder of the loan.

SECTION 6. CRITERIA FOR ELIGIBILITY.

.01 The criteria for authorizing repayments of student loans are:

a. For Recruitment:

1. the candidate possesses qualifications which meet an important need of the operating unit, asdetermined by the operating unit;

2. the candidate would not accept the position without receiving the student loan repaymentincentive;

3. the candidate is not in default on repayment of the student loan; and

4. the student loan was used to pay tuition and related expenses for course work taken by theapplicant.

b. For Retention:

1. the recipient is an employee of the operating unit;

2. the operating unit determines that the employee possesses high or unique qualifications ormeets a special need of the operating unit;

3. in the absence of offering the student loan repayment benefit, the employee would very likelyleave for employment outside the Department;

4. the departure of the employee would affect the agency's ability to carry out an activity orfunction deemed essential to the agency's mission;

5. the employee has no performance or conduct actions pending against him/her;

6. the employee's most recent performance appraisal of record using the Department'sperformance appraisal system established under part 430, subpart B of Title 5, is at least levelthree ("Fully Successful") on a five-level system, or "Eligible" or "Meets or exceeds expectations"under a two-level system;

7. the employee is not in default on repayment of the student loan; and


8. the student loan was used to pay tuition and related expenses for course work taken by theemployee.

.02 Operating units may include additional criteria in their plan so long as the criteria are notused to arbitrarily restrict access to the program.

SECTION 7. CRITERIA FOR AMOUNT AND TIMING OF LOAN REIMBURSEMENT PAYMENTS.

In determining the amount of the loan reimbursement payments and the timing of thepayments, operating units must consider the following factors:

a. the employee's current or potential value to the operating unit;

b. budgetary restraints such as how far in advance funds can be committed;

c. if payment extends beyond the current fiscal year, repayments are subject to the availabilityof funds;

d. the special skills the individual brings to the operating unit and how those skills enhance theability of the organization to meet mission requirements; and

e. any other criteria or circumstances which enhance the value of the employee to the operatingunit.

SECTION 8. APPLICATION AND SELECTION PROCEDURES.

Where operating units decide to allow employees to apply for this repayment benefit, they mustpublicize the application procedures to employees. The procedures must describe the thresholdqualifications to meet the "high or unique qualifications" or "special need of the operating unit"standard for retention and the evidence required to show that the applicant/employee would belikely to leave the Department absent receiving the student loan repayment benefit. Forexample, the operating unit may determine that only employees in scientific and engineeringpositions at grades GS-5 through GS-9 meet both criteria, "high or unique qualifications" and"likelihood of leaving the Department" based on their pay being significantly below the marketrate. In identifying certain categories of positions, the operating unit may further limit eligibilityto those employees with their most recent performance rating at or above a certain level, forexample, "commendable" or above for a five-level system. After establishing those criteria, theoperating unit must then describe how selections will be made from those employees meetingthe eligibility criteria. For example, selections may be based on length of service with theFederal Government, and/or the operating units, or based on other considerations such as theamount or recency of the outstanding debt. Regardless, the criteria must be applied uniformlyand equally and be consistent with and adhere to the merit system principles. Operating unitemployees should be notified regarding any changes in the application procedures prior to thechanges becoming effective.

SECTION 9. JUSTIFICATION FOR STUDENT LOAN REPAYMENTS.

Requests for approval of a student loan repayment incentive must include a written justificationaddressing each of the criteria for eligibility and state the amount to be reimbursed. Repaymentrequests for new hires must be submitted by an authorized operating unit official and receivedby the servicing human resources office before the candidate actually enters on duty. Therequest must also identify other compensation options which have been considered and thereasons for their use or rejection.

SECTION 10. STUDENT LOAN REPAYMENT SERVICE AGREEMENT.

Before the operating unit initiates repayment of the student loan, the current or newly-appointed employee must sign a service agreement which requires completion of a minimumthree year period of employment with the Department, if the amount to be reimbursed is for atotal of $20,000 or less. For each additional $10,000 increment, the operating unit reimburses,a minimum of one, but not more than three, additional years of service must be added to theservice agreement. The following table illustrates the application of the service agreement


formula.

Service Requirement Table

ReimbursementAmount

Minimum ServiceRequirement

Maximum ServiceRequirement

0 - $20,000 3 years 3 years

$20,001- $30,000 1 additional year(4 years total)

3 additional years(6 years total)

$30,001 - $40,000 1 additional year(5 years total)






a. The additional service requirement is only applied when the reimbursement dollar threshold asshown in the Service Requirement Table is exceeded. Operating units are not authorized toprorate the service requirement to correspond with amounts that do not meet the next higher$10,000 increment.

b. Operating units may establish service requirements which are more restrictive than those inthe Service Requirement Table. For example, an operating unit may require the minimum threeyear service requirement for the first $10,000 reimbursed and an additional one to three yearsfor each additional $10,000 reimbursed. However, they cannot raise the maximum amount forthe minimum three year service requirement above $20,000 or lower the minimum servicerequirement for the full $60,000 reimbursement below seven years or have the maximumservice requirement exceed 15 years. Operating unit plans should include service requirementswhere they differ from the Service Requirement Table or state that their plan will follow theService Requirement Table.

c. For new hires, when determining whether to require the minimum or maximum servicerequirement for each additional $10,000 beyond the minimum three year requirement, theoperating unit should balance the value of the student loan repayment benefit as a recruitingincentive versus the interests of the operating unit in recouping their investment.

d. Where the operating unit utilizes the student loan repayment benefit for current employees,criteria must be included in the operating unit plan for determining whether the minimum ormaximum service repayment amount will be required for each $10,000 increment. For instance,employees with 10 or more years of service with the Department and/or the operating unitmight only be required to serve the one-year minimum for each additional $10,000 increment.

e. The agreement must also indicate the conditions under which the operating unit may recoupstudent loan repayments from the employee which are explained in Section 12, EmployeeIndebtedness to the Department.

f. The agreement must also contain a statement clarifying that the agreement in no wayconstitutes a right, promise, or entitlement for continued employment or noncompetitiveconversion to the competitive service.

g. The agreement must indicate that subsequent years repayment are subject to availability offunds, and are not guaranteed.

h. The Repayment Agreement is to be sent to the servicing human resources office with a


transmittal memorandum for payment and documentation which verifies the employee's liabilityfor the loan and the outstanding balance. A copy of the service agreement will be filed in theleft side of the employee's Official Personnel Folder for the duration of the agreement. If theamount of the reimbursement by the operating unit is increased from the original agreement,the service agreement must be extended consistent with the Service Requirement Table. Inaddition, the service agreement must be modified to reflect the increased benefit and filed inthe left side of the employee's Official Personnel Folder. See Appendix A for a suggestedStudent Loan Repayment Service Agreement format.

i. The service agreement period begins on the date of the first payment by the operating unit tothe lending institution.

SECTION 11. LOSS OF ELIGIBILITY FOR LOAN REPAYMENT BENEFITS.

An employee receiving loan repayment benefits from an operating unit will be ineligible forcontinued benefits if the employee:

a. separates voluntarily or involuntarily from the Department;

b. separates from the operating unit to another operating unit within the Department, if statedin the service agreement;

c. does not maintain an acceptable level of performance, as determined under standards andprocedures prescribed by the operating unit head; or

d. violates any of the conditions of the service agreement.

SECTION 12. EMPLOYEE INDEBTEDNESS TO THE DEPARTMENT.

.01 An employee is deemed indebted to the Department for the amount of student loanrepayments paid on the employee's behalf up until the time of separation if the employee:

a. is separated from the Department involuntarily on account of misconduct or poorperformance; or

b. leaves the Department voluntarily without meeting the terms of the service agreement.

.02 This indebtedness provision also applies to an employee voluntarily separating from theDepartment to enter into the service of any other Federal agency.

SECTION 13. WAIVER OF EMPLOYEE INDEBTEDNESS.

Heads of operating units may waive, in whole or in part, the right of recovery of an employee'sdebt incurred for failure to meet a requirement of the service agreement if he or she determinesthat recovery would be against equity and good conscience or against the public interest, asdetermined by the operating unit. This authority may be re-delegated to an authorizedappointing official within the operating unit.

SECTION 14. WAIVER APPLICATION PROCESS.

Repayment may be wholly or partially waived at the discretion of the operating unit head ifrecovery would not be in the public interest or would be against equity or good conscience (e.g.,when an employee separates from service due to a disability).

The employee or former employee who fails to meet the terms of the Repayment ServiceAgreement may request a waiver of the debt. If the individual remains an employee of theagency, the employee must submit a written waiver request through their immediate supervisorto the head of the operating unit or the authorized appointing official within the operating unitwith delegated waiver approval authority. Individuals who are no longer employed by theoperating unit should submit a written waiver request directly to the head of the operating unitor the authorized appointing official delegated waiver approval authority. The request shouldcontain a copy of the Repayment Service Agreement, the bill presented by the agency to the


current or former employee or verification of the exact amount of debt where a bill has not beengenerated, and a narrative explaining why recovery by the agency would be against equity andgood conscience or against the public interest. Collection of the debt will be suspended pendingthe decision on the waiver request. Operating unit plans must also include waiver procedures.

SECTION 15. PROCEDURES FOR PAYMENT.

.01 The National Finance Center (NFC), the Department's Personnel/Payroll System, will processrepayments of student loans through their manual pay process. The loan repayments will bemade as lump sum payments. The loan repayments will be treated as "supplemental wages" forpayroll purposes; NFC will withhold a flat 28% for Federal tax, a flat 2% for State tax (ifapplicable), a flat 2% for City/Local tax (if applicable), a flat 6.2% for OASDI taxes (ifapplicable) and 1.45% for Medicare tax from the gross amount of the repayment. The netrepayment will be sent directly to the lending institution. For example, where an operating unitis paying $10,000 of an employee's student loan, NFC will withhold 28% for Federal tax, 2% forState tax, 2% for City/Local tax, 6.2% for OASDI tax, and 1.45% for Medicare tax, and remitthe net to the lending institution.

.02 NFC will establish a transaction code for the Earnings and Leave Statement so that theamount of the student loan repayment will be reflected on the employee's Earnings and LeaveStatement.

SECTION 16. OPERATING UNIT RESPONSIBILITY FOR LATE FEES.

Operating units are not responsible for late fees assessed by the holder of an employee'sstudent loan. Operating units should, to the extent possible, ensure that the timing of theirpayments to the lender coincides with the date the loan payment is due.

SECTION 17. RELATIONSHIP TO OTHER RECRUITMENT/RETENTION INCENTIVES.

A student loan repayment incentive may be paid in addition to a retention allowance, orrecruitment and relocation bonus. The period of service required by a Recruitment Bonus ServiceAgreement or a Relocation Bonus Service Agreement are exclusive from the period of servicerequired under a Student Loan Repayment Service Agreement. However, the specified period ofservice in a Student Loan Repayment Service Agreement may begin at the same time and runconcurrently with other service agreements.

SECTION 18. ANNUAL RECONSIDERATION OF PAYMENT AMOUNT.

Operating units may reconsider individual employee payment amounts on an annual basis ifbudgetary considerations are an issue, if such an option is included in the employee serviceagreement.

SECTION 19. SEPARATION OF AN EMPLOYEE RECEIVING THE STUDENT LOANREPAYMENT BENEFIT.

The operating unit of each separating employee who receives the student loan repaymentbenefit must notify the servicing human resources office of the impending separation date of theemployee. The notification must indicate whether the employee has fulfilled the terms of theservice agreement. If the employee has not fulfilled the terms of the agreement, the operatingunit must indicate whether it will seek reimbursement and the amount it is seeking. If theoperating unit waives the indebtedness amount, a signed waiver must be submitted from anauthorized official containing the amount to be waived and a brief statement indicating whyrequiring the employee to reimburse the operating unit would be against equity and goodconscience or against the public interest. Where the employee requests a waiver, the operatingunit must notify the servicing human resources office immediately upon receiving the request. Ifthe operating unit approves the waiver request, a copy of the approved waiver request, withthesignature of the approving official, must be forwarded to the servicing human resourcesoffice and a copy provided to the employee. If the waiver request is disapproved, the operatingunit must provide the servicing human resources office with documentation signed by thedeciding official that the waiver request was disapproved. The employee must receive writtennotification of the disapproval.


SECTION 20. RECORDS AND DOCUMENTATION REQUIREMENTS.

.01 Each operating unit must develop and maintain a policy for the reimbursement of studentloans. At a minimum, each policy must contain all the elements of this DAO plus an explanationof the selection process for determining which prospective and current employees shall receivethe student loan reimbursement benefit.

.02 Documentation must be maintained by the operating unit for each employee receiving thereimbursement benefit for a period of three years after the date of the final payment to theeducational or lending institution (if an employee leaves the operating unit within the three yearperiod of the employment agreement, the retention period is extended indefinitely pendingcollection of any outstanding debt). The documentation must contain, at a minimum, the name,title, series and grade of the employee receiving the benefit, the name of the educational orloan institution receiving the reimbursement, the amount of the reimbursement, the date thefirst and last payments were made by the operating unit, the justification for awarding thereimbursement, and a signed copy of the service agreement.

SECTION 21. REPORTING REQUIREMENTS.

Before December 1 of each year, operating units must submit a written report to theDepartment's Office of Human Resources Management stating:

a. the number of employees selected to receive the benefit;

b. the job classifications of the employees selected to receive the benefits; and

c. the cost to the operating unit of providing the benefits under this policy.

SECTION 22. PROGRAM OVERSIGHT.

Operating units are required to regularly monitor and review the use of the student loanrepayment benefit to ensure that payments conform to the criteria established under thisguidance. The Department will conduct such oversight as necessary to ensure conformance withthis policy.

SECTION 23. EFFECT ON OTHER ORDERS.

This Order supersedes Department Administrative Order 202-957, dated July 18, 2003, and anyoperating unit policy directives on these matters.

____________________________________Director for Human Resources Management

Approved:

_______________________________Chief Financial Officer and AssistantSecretary for Administration

Office of Primary InterestOffice of Human Resources Management

APPENDIX A

DEPARTMENT OF COMMERCESTUDENT LOAN REPAYMENT SERVICE AGREEMENT

EMPLOYEE__________________________________ SSN_____________________________POSITION____________________________________ GRADE__________________________DUTY STATION_________________________________________________________________BUREAU________________________________________________________________________


EMPLOYMENT TERM____________________________________________________________REQUIRED PERIOD OF SERVICE___________________________________________________ TYPE OF LOAN__________________________________________________________________NAME/ADDRESS OF LOAN HOLDER______________________________________________TOTAL LOAN REPAYMENT AMOUNT______________________________________________TOTAL AMOUNT TO BE PAID IN CURRENT FISCAL YEAR (payment may be renewed for eachfiscal year until the total repayment amount is reached, subject to availability of funds) _____________________________

(Attach documentation showing that this is an authorized school loan in accordance with thedefinition in Title 5 U.S.C. 5379. The documentation must verify both the employee's liabilityand the outstanding balance. )

In return for accepting the benefit of the loan repayments specified above, I, the employee,hereby ACCEPT EMPLOYMENT WITH/AGREE TO REMAIN IN THE EMPLOYMENT OF the UnitedStates Department of Commerce, [NAME OF ORGANIZATIONAL UNIT] (the "AGENCY") under thefollowing terms:

1. I will remain an employee of the AGENCY for a period of not less than three (3) years fromthe date of the first payment by the AGENCY under this agreement.

2. If, within said three year period I separate from the employment of the AGENCY, then I shallbe indebted to, and hereby oblige myself to repay, the AGENCY for all funds received from orloan repayments made by the AGENCY as specified herein above.

3. Notwithstanding the foregoing, it is agreed that I shall not be so indebted and obligated if myseparation of employment from the AGENCY is for any of the following reasons:

a. Acceptance of a position with another organizational unit within the Department ofCommerce, provided, however, I remain within the employment of the Federal Government forthe balance of said three-year period;

b. Separation from employment with the AGENCY is for the convenience of the FederalGovernment; or

c. Such other conditions, which as determined within the sole discretion of the head of theAGENCY or his/her delegate, are found to be against equity and good conscience or contrary tothe public interest, so made in writing by the head of the AGENCY or his/her delegate.

4. If I separate from the employment of the AGENCY within said three (3) year period for anyreason, it is agreed and understood that the AGENCY is immediately released from anyobligation to continue making such loan repayments from the earlier of: (a) the date ofseparation from the employment of the AGENCY; or (b) the date of notice to the AGENCY ofsaid impending separation of employment. The AGENCY may also cease making such loanrepayments if: (a) I do not maintain at least a satisfactory rating on my most recentperformance appraisal; or (b) I violate any other condition of this Service Agreement.

5. Should I become so indebted to the AGENCY, I agree that the AGENCY may recover theentire amount of any and all funds received from or loan repayments made by the AGENCY asspecified herein above, and that such indebtedness shall bear interest from the date determinedin accordance with Paragraph 3, above, at a rate equal to the coupon issue yield equivalent (asdetermined by the Secretary of Treasury) of the average accepted auction price for the lastauction of fifty-two (52) weeks United States Treasury bills settled immediately prior to saiddate. (This is the judgment rate of interest as set forth in 28 U.S.C. 1961.) The agency mayalso assess and collect other administrative costs and expenses as may be incurred by theAGENCY in the collection of such indebtedness.

6. I am responsible for any late fees assessed by the holder of my student loan for untimelypayments made to the lender by the Department of Commerce.


7. I am responsible for any tax consequences or other obligations which may result from eitherthe loan repayments made by the AGENCY hereunder and/or termination of such repaymentsand/or the collection of any indebtedness.

8. This Service Agreement in no way constitutes a right, promise, or entitlement for continuedemployment or noncompetitive conversion to the competitive service.

9. Repayments are subject to availability of funds, and are not guaranteed.

EMPLOYEE'S SIGNATURE___________________________ DATE________________

SUPERVISOR'S SIGNATURE____________________________ DATE________________

____________________________ ___________________ DATE________________SECOND LEVEL SUPERVISOR'S SIGNATURE (Optional)

A copy of this agreement must be sent to the servicing human resources management office forinclusion in the Official Personnel Folder.

the student loan repayment program in the federal

Documents