U.S. Office of Personnel Management - Ensuring the Federal Government has an effective civilian workforce

Washington, D.C. -- Federal agencies have significantly increased their use of the student loan repayment program in Fiscal Year (FY) 2002, the Director of the U.S. Office of Personnel Management (OPM), Kay Coles James today announced. “I am encouraged by the agencies’ increased use of existing flexibilities such as the student loan repayment program and fully expect that they will continue to implement human capital strategies to build successful, high-performing organizations.”

OPM’s annual report to Congress declared that in FY 2002, sixteen Federal agencies provided more than $3.1 million dollars in student loan repayments for 690 Federal employees. In addition, eight other agencies reported that they have established an agency loan repayment plan and expect to make use of the program in the near future. Five additional agencies reported that they are in the process of establishing a program.

This is in stark contrast to one year ago, where in March of 2002, OPM reported that only one agency had authorized a student loan repayment in FY 2001, and three additional agencies had authorized payments in early FY 2002. OPM anticipated a significant increase in the use of the authority, as agencies had more time to implement their loan repayment plans and as interest in the program increased.

Under 5 U.S.C. 5379, Federal agencies may authorize a student loan repayment of up to $6,000 for an employee in any calendar year. The program was established as a recruitment or retention incentive for highly qualified candidates or current employees. An employee for whom a student loan repayment benefit is paid must sign a service agreement to remain in the service of the paying agency for a period of at least three years. The law also requires agencies to report annually to OPM on their use of the student loan repayment program for the previous fiscal year.

OPM is encouraged by the agencies’ improved use of the student loan repayment program in FY 2002. Upon release of the report, Director James stated, “OPM is committed to promoting the value of the student loan repayment program, as well as other existing recruitment and retention incentives, as effective tools for attracting and retaining well-qualified, high-performing employees. The strategic use of this existing flexibility is consistent with President Bush’s pledge to get the right people to the right place at the right time.” OPM will continue to work with agencies to assist them in targeting their use of student loan repayments, as well as other recruitment and retention flexibilities, to meet their human capital management needs.

The report can be found at www.opm.gov/oca.

OPM oversees the federal work force and provides the American public with up-to-date employment information. OPM also supports U.S. agencies with personnel services and policy leadership including staffing tools, guidance on labor-management relations and programs to improve.

United States Office of Personnel Management

Theodore Roosevelt Building
1900 E Street, NW, Room 5347
Washington, DC 20415-1400

Phone: (202) 606-2402
FAX: (202) 606-2264