Montana Wants Employers To Pay Down Their Employees’ Student Loans
By Annie Wood
This post first appeared on genprogress.org
Wouldn’t it be great for college graduates to get a little student loan relief as they enter the workforce, and for their employers to get a break for supporting their debt-burdened employees? It could be a real win-win, right?
Montana House Representative Bill Harris from Winnett, MT is trying to make this ideal situation for both graduates and their bosses a reality. His plan involves giving a tax credit to employers who help pay down their employees’ student loans.
Last week, Rep. Harris stressed the problem that a growing number of Americans are facing: Debilitating student loan debt. Rep. Harris stated before Montana’s House Taxation Committee, “Accumulated student debt has become a huge obstacle for young Montanans attempting to prepare themselves to enter the job market.”
Rep. Harris’ House Bill 341 would allow employers to get a tax credit of up to $450 per employee annually for up to three years against either their corporate or individual tax income, if they kick in $1,800 directly to lower their employee’s student loan debt.
Harris pointed out the difficulty graduates face in participating in the economy. Even after joining the workforce post-graduation, many Americans with student debt are finding it hard to make ends meet, much less purchase cars and homes. This slowed launch of graduates into the real world can have an impact on an entire state’s economy.
According to the Institute for College Access and Success’ Project on Student Debt, about 7 in 10 graduates of public colleges in the United States in 2013 had some kind of student loan debt. In Montana, 66 percent of graduates are in debt, with an average of $27,568 each.
Rep. Harris stressed that his bill would not create a bailout for those with student loans. Instead, graduates will just get a fairer shot as they enter the working world.
“They want to apply the skills they have worked so hard to acquire. There is no handout here, only increased opportunity for the very deserving—our youth.” Rep. Harris further stressed that the state’s investment would be well worth the cost—about $715,000, according to the governor’s office.
“I contend that by reducing the debt load, young Montanans wanting to work will expand their economy with great vigor and enthusiasm,” Rep. Harris said.
While the House committee did not take any immediate action with regard to the bill, it has been well-received, particularly by students. Garrett Lankford, serving as the representative for the Associated Students of Montana State University, voiced the support of his peers: “We want to go to work when we graduate, and this bill helps us.”
In proposing this bill, Rep. Harris is making clear that those with student debt are not irresponsible for having loans, nor are they asking for an easy out. Both graduates and employers—as well as the state economy overall—stand to benefit from giving those with debt a fair shot.
Annie Wood is a Student Debt Reporter at Generation Progress. Follow her on Twitter @anniewood28