While the Department of Education looks ready to drop its program that forgives the debt of federal student loan borrowers who work for the government, one city is picking up the slack, saying it will help its workers pay down their student loan bills.
The city of Memphis has launched the Student Loan Reduction Program, intended to assist full-time city employees in paying down their student debt while also building and retaining an engaged workforce, the city said in an announcement last week, claiming the intuitive is the first of its kind of a municipality.
Under the program, which launches July 1 and is administered bytuition.io, eligible city employees will receive a monthly contribution of $50. These funds will go toward principal repayment.
While $50 might seem like a minuscule amount compared to the thousands of dollars borrowers owe on average, the contribution is meant to alleviate some of the burden tied to student loan debt.
Borrowers are eligible for the program if they have worked for the city full-time for at least 12 months.
Memphis is just the latest city or employer seeking to provide employees with assistance when it comes to higher education debts.
In 2014, Niagara Falls launched a program that promised to help repay student loans if they moved to the city for a certain number of years.
Last year, New York launched a student loan forgiveness program of its own, paying up to two years of student loan bills for eligible residents who have encountered trouble paying down their debt. Earlier this year, New York lawmakers approved the Excelsior Scholarship program that would initially provide tuition-free college at the state’s public colleges and universities to families making up to $100,000 a year.
Employers have also jumped on the assistance train by providing student loan payment contributions as part of their compensation plans or sending workers to college. Pizza Hut, JetBlue, Starbucks, and others have announced tuition reimbursement programs in recent years.