Reps. Peters and Davis Reintroduce Bipartisan Bill to Address Rising Student Loan Debt
Today, U.S. Congressmen Scott Peters (CA-52) and Rodney Davis (IL-13) led a bipartisan group of 99 Members of Congress to reintroduce H.R. 1043, the Employer Participation in Repayment Act, which would incentivize employers to offer student loan assistance to help their employees pay off student loan debt. The bill would provide financial assistance to Americans struggling to pay off college debt by making employer-provided student loan payments tax-exempt up to $5,250 a year—similar to tax exemptions for tuition assistance programs.
“I relied on student loans to get through college when the cost of higher education was much lower than it is today. Now, the collective debt among people in the U.S. is more than $1.5 trillion dollars, which hurts economic growth,” said Rep. Peters. “Many employers have successfully helped their employees pay down their debt, and encouraging similar programs across the country can move us closer to solving the student debt crisis. Our economy benefits, too, when young Americans begin making investments like buying a home, starting a family, or saving for retirement. I appreciate Rep. Davis’s commitment to tackling this important issue.”
Rep. Peters first introduced this bill with Rep. Davis in 2017, and this year, Reps. Earl Blumenauer (OR-03), Elise Stefanik (NY-21), Stephanie Murphy (FL-07), Tom Cole (OK-04), Gwen S. Moore (WI-04), and Jason Smith (MO-08) join as co-leads of the bill. Senators Mark Warner (D-VA) and John Thune (R-SD) will introduce an identical bill in the Senate.
“Student loan debt is now the second highest form of consumer debt and prevents many in the workforce from fully contributing to our economy,” said Rep. Davis. “Student loan debt is such a major issue that some private companies have found that offering a benefit to help employees pay down their student loans has allowed them to recruit and retain young talent. Our bill simply builds on this private-sector approach to addressing the student loan debt crisis in this country by allowing this benefit to be tax-free to both the employee and the employer. This innovative approach to student loan debt that has the potential to be the 401(k) of student loans and help millions of graduates who are struggling with student debt.”
"The crushing level of student loan debt that our college students incur does not incentivize graduating high school seniors to further their education - in fact, it discourages them from doing so. This bill would allow employers to offer their employees tax-free benefits that would help students pay off their loans in a timely manner, so they have the opportunity to save for a home, start a family, or simply live without a looming cloud of debt hanging over their heads. Additionally, this bill is pivotal to the future of our economy, as millennials are expected to make up the vast majority of the workforce in just 6 years,” said Rep. Stefanik.
“Our economic well-being is dependent on our ability to recruit a talented workforce that is unburdened by the crippling effects of student loan debt. Businesses should be encouraged to do their part by providing employees with a benefit that can help them lower their long-term educational costs. I’m proud to join this bipartisan effort to help borrowers manage their student loan debt, and give employers the chance to lend a hand to their workers,” said Rep. Murphy.
“Without question, the growing burden of student loan debt is not only holding many American workers back, it is creating a troubling strain on the nation’s economy as well. I am pleased that the Employer Participation in Repayment Act provides a commonsense incentive for employers to invest in their workers and as a result strengthen the economy and improve our collective future,” said Rep. Cole.
“At a time when my constituents are struggling to pay off thousands of dollars in student loans, this bipartisan bill just makes sense,” said Rep. Moore. “Congress must act to relieve students of this burden and empower young Americans to invest in their tomorrow.”
“Too many Americans leave higher education drowning in student loan debt,” said Rep. Smith. “This legislation will further reward those students who enter the workforce and will help more Americans afford a quality education. Making employer student loan repayments tax-exempt will give employers another tool to attract talented employees while also reducing the debt burden on the shoulders of young working Americans.”
Rep. Peters has championed expanding education opportunities during his service in Congress. Last year, Rep. Peters’ bill to extend education benefits to reservists and guardsmen who are called to serve during times of national emergency or war was signed into law in December 2018. Rep. Peters also introduced a bill to provide full education benefits to Purple Heart recipients, regardless of how long they served on active duty, which also became law in August 2017.