Repayment of Student Loans, 914-918 [E7-101]
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914
Proposed Rules
Federal Register
Vol. 72, No. 5
Tuesday, January 9, 2007
This section of the FEDERAL REGISTER
contains notices to the public of the proposed
issuance of rules and regulations. The
purpose of these notices is to give interested
persons an opportunity to participate in the
rule making prior to the adoption of the final
rules.
OFFICE OF PERSONNEL
MANAGEMENT
5 CFR Part 537
RIN 3206–AK51
Repayment of Student Loans
Office of Personnel
Management.
ACTION: Proposed rule.
AGENCY:
SUMMARY: The Office of Personnel
Management (OPM) is issuing proposed
regulations to revise the rules governing
the authority to offer student loan
repayment benefits to current Federal
employees or candidates for Federal
jobs when necessary to recruit or retain
highly qualified personnel. These
revisions include certain policy changes
and clarifications to assist agencies in
taking full advantage of the Federal
student loan repayment program.
DATES: Comments must be received on
or before March 12, 2007.
ADDRESSES: Send or deliver comments
to Jerome D. Mikowicz, Deputy
Associate Director for Pay and Leave
Administration, Office of Personnel
Management, Room 7H31, 1900 E
Street, NW., Washington, DC 20415–
8200, FAX: (202) 606–0824, or e-mail at
pay-performance-policy@opm.gov.
FOR FURTHER INFORMATION CONTACT:
Gene Holson by telephone at (202) 606–
2858; by fax at (202) 606–0824; or by email at pay-performancepolicy@opm.gov.
The Office
of Personnel Management (OPM) is
issuing proposed regulations to revise
the rules implementing 5 U.S.C. 5379,
which allow agencies to offer student
loan repayment benefits to current
Federal employees or candidates for
Federal jobs when necessary to recruit
or retain highly qualified personnel. The
primary purpose of this revision is to
make part 537 more readable and
usable. However, we also are proposing
substantive changes based on
experience to date to improve program
administration in the agencies and
promote alignment between this
authority and related authorities that
support recruitment and retention
efforts. The following table lists, by
specific regulatory section, the proposed
substantive changes and provides a brief
description of the purpose and/or effect
of each change.
SUPPLEMENTARY INFORMATION:
Proposed rule
Description of proposed change
§ 537.102 .....................
Definitions. The current language in the definition of employee regarding the exclusion of certain types of employees
would be moved to proposed § 537.104, which deals with employee eligibility.
New definitions of student loan repayment benefit and loan payment would be added to distinguish more clearly between the benefit credited to the employee and the loan payments made to a loan holder by an agency.
Documentation. The requirement for documentation would be revised to cover only actions taken to approve a student
loan repayment benefit. The current language requires documentation in each case in which an employee is ‘‘considered’’ for a student loan repayment benefit.
Employee eligibility. Paragraph (a) would revise the current language in § 537.104 to clarify when an employee in a
time-limited appointment may receive student loan repayment benefits.
Paragraph (b) would be modified to incorporate language currently found in the definition of employee.
Paragraph (c) would provide a cross reference to the provisions of § 537.108, which deal with loss of eligibility for student loan repayment benefits.
Criteria for payment. This section would be rewritten to focus more clearly on the criteria that must be met to justify the
approval of student loan repayment benefits.
The provisions for written documentation and the timing of recruitment-related approvals would be clarified and moved
to § 537.106, which deals with payment conditions and procedures. (See § 537.106(a)(3) and (4).)
Current Federal employees. Proposed paragraph (c) would provide that an agency may not authorize student loan repayment benefits to recruit an individual from outside the agency who is currently employed in the Federal service.
The intent of the student loan repayment authority is to help agencies recruit individuals for Federal service, not to
compete with other agencies for current Federal employees. This restriction would be consistent with current OPM
guidance and the rules concerning inter-agency competition when providing recruitment and retention incentives
under 5 CFR part 575.
General conditions. These provisions establish standards and requirements necessary to provide for reasonable uniformity across agencies, as required by 5 U.S.C. 5379(g). Proposed paragraph (a)(4) would clarify that a service
agreement may be signed before a job candidate begins serving in the position for which he or she was recruited.
This paragraph would also incorporate language currently found in § 537.105(b).
Age of student loans. Proposed paragraph (b)(3) would clarify that, although these regulations do not impose a limit on
the age of a student loan, an agency may specify in its own plan that only student loans made within a certain timeframe are eligible for repayment.
Benefit cap. A new paragraph would clarify that the full gross amount of the student loan repayment benefit (before deducting any tax withholdings from that gross amount) counts toward the benefit cap.
Contingent additional benefits. A new sentence would clarify that a service agreement may address the possibility that
the agency may modify the agreement to provide student loan repayment benefits in addition to those fixed in the
agreement based on contingencies or conditions specified in the agreement. For example, benefits in a later year
could be contingent on budget levels.
§ 537.103(h) ................
§ 537.104 .....................
§ 537.105 .....................
§ 537.106(a) ................
§ 537.106(b) ................
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§ 537.106(c)(3) ............
§ 537.107(a) ................
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915
Proposed rule
Description of proposed change
§ 537.107(b) ................
Agreement modifications. The current sentence on ‘‘increases’’ and ‘‘renewals’’ would be removed. The replacement
sentence would clarify that the agency and the employee may mutually agree to modify a service agreement to provide additional student loan repayment benefits for additional service without the need for a new service agreement.
(A new service agreement would require additional service of at least 3 years. In contrast, an agreement modification
could, for example, add just 1 year of additional service.) The possibility of payment increases would now be addressed in the new sentence added to paragraph (a).
Periods in a non-pay status. A new rule would provide that periods of leave without pay, or other periods during which
the employee is not in a pay status, would not count toward completion of the required service period. This means
the originally projected service completion date must be extended by the total amount of time spent in non-pay status. However, as provided by 5 CFR 353.107, absence because of uniformed service or compensable injury is considered creditable toward the required service period upon reemployment.
Service period commencement. A new paragraph would be added to address when a service period begins.
Reimbursement provision in service agreement. A new provision would require agencies to include in any service
agreement a provision addressing whether or not the individual will be required to reimburse the agency for student
loan repayment benefits if he or she transfers to a different agency during the service period. (Also see proposed
§ 537.109(b)(2), which would incorporate language currently found in § 537.109(d)(2).)
Loss of eligibility. Proposed paragraph (a)(3) would clarify that loss of eligibility based on a condition in the service
agreement would occur only when the agreement expressly states that a violation of the condition will result in the
loss of eligibility.
Reimbursement under a modified service agreement. Current language would be modified to clarify what would happen when an agency and an employee mutually agree to modify an existing service agreement to provide additional
student loan repayment benefits for additional service (e.g., a 4th year following an initial 3-year service period). The
modified service agreement may stipulate that if the employee completes the initial service period but fails to complete the additional service period, he or she would be required to reimburse the paying agency only for the amount
of any student loan repayment benefits received during the additional service period. (Also see proposed
§ 537.107(b) regarding modified service agreements.)
Records retention. Current language would be modified to clarify that a record on a determination to provide student
loan repayment benefits must be retained for at least 3 years after the end of the employee’s service period as specified in the service agreement. We are deleting the provision regarding an earlier date linked to an OPM program review because as a practical matter a program review may not necessarily mean each case is reviewed individually.
Reports. A new provision would require agencies to report on the student loan repayment benefits they provided during
the previous calendar year rather than during the previous fiscal year. Currently, agencies are required to report to
OPM by the end of the calendar year on the student loan repayment benefits they provided during the previous fiscal
year. However, the law imposes a calendar year limitation on the amount of student loan repayment benefits an
agency may provide to an employee. Also, we note agencies are currently required to report to OPM on their use of
other recruitment and retention flexibilities (e.g., recruitment, relocation, and retention incentives under 5 CFR part
575) on a calendar year basis. Therefore, we are proposing this change to simplify reporting requirements for agencies. The proposed regulation would require agencies to report to OPM by March 31st of each year on their use of
the student loan repayment authority during the previous calendar year.
In paragraphs (b)(1) and (b)(2), we propose to replace ‘‘employees selected to receive’’ with ‘‘employees who received’’ because an individual may be selected to receive student loan repayment benefits during one reporting period, but not actually receive benefits until the following reporting period. This change would be consistent with our
approach for reporting data on student loan repayments in our annual report to Congress.
§ 537.107(d) ................
§ 537.107(e) ................
§ 537.108(a) ................
§ 537.109(c) .................
§ 537.110(a) ................
§ 537.110(b) ................
E.O. 12866, Regulatory Review
PART 537—REPAYMENT OF STUDENT
LOANS
This rule has been reviewed by the
Office of Management and Budget in
accordance with E.O. 12866.
Regulatory Flexibility Act
I certify that these regulations would
not have a significant economic impact
on a substantial number of small entities
because they would apply only to
Federal agencies and employees.
List of Subjects in 5 CFR Part 537
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Administrative practice and
procedure, Government employees,
Students, Wages.
Authority: 5 U.S.C. 5379(g).
U.S. Office of Personnel Management.
Linda M. Springer,
Director.
§ 537.101
Accordingly, OPM is proposing to
revise 5 CFR part 537 to read as follows:
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Sec.
537.101 Purpose.
537.102 Definitions.
537.103 Agency student loan repayment
plans.
537.104 Employee eligibility.
537.105 Criteria for payment.
537.106 Conditions and procedures for
providing student loan repayment
benefits.
537.107 Service agreements.
537.108 Loss of eligibility for student loan
repayment benefits.
537.109 Employee reimbursements to the
Government.
537.110 Records and reports.
Purpose.
This part implements 5 U.S.C. 5379,
which authorizes agencies to establish a
student loan repayment program for the
purpose of recruiting or retaining highly
qualified personnel. Under such a
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program, an agency may agree to repay
(by direct payment to the loan holder on
behalf of the employee) all or part of any
outstanding qualifying student loan or
loans previously taken out by a job
candidate to whom an offer of
employment has been made, or by a
current employee of the agency.
§ 537.102
Definitions.
Agency has the meaning given that
term in subparagraphs (A) through (E) of
5 U.S.C. 4101(1).
Authorized agency official means the
head of an Executive agency or an
official who is authorized to act for the
head of the agency in the matter
concerned.
Employee means an employee of an
agency who satisfies the definition of
the term in 5 U.S.C. 2105.
Loan payment means the net payment
made by an agency to the holder of a
student loan (after deducting any tax
withholdings that may be made from the
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gross student loan repayment benefit
credited to the employee).
Service agreement means a written
agreement between an agency and an
employee (or job candidate) under
which the employee (or job candidate)
agrees to a specified period of service in
exchange for student loan repayment
benefits, subject to the conditions set
forth under this part.
Student loan means—
(1) A loan made, insured, or
guaranteed under parts B, D or E of title
IV of the Higher Education Act of 1965;
or
(2) 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.
Student loan repayment benefit
means the benefit provided to an
employee under this part in which an
agency repays (by a direct payment on
behalf of the employee) a qualifying
student loan previously taken out by
such employee. The dollar value of this
benefit is the gross amount credited to
the employee at the time of a loan
payment to the holder of the student
loan, before deducting any employee tax
withholdings from that gross amount as
described in § 537.106(a)(6)(iii). A
student loan repayment benefit is not
considered basic pay for any purpose.
Time-limited appointment means an
appointment of temporary duration
including—
(1) A temporary appointment under 5
CFR part 316, subpart D, or similar
authority;
(2) A term appointment under 5 CFR
part 316, subpart C, or similar authority;
(3) An overseas limited appointment
with a time limitation under 5 CFR part
301, subpart B;
(4) A limited term or limited
emergency appointment in the Senior
Executive Service, as defined in 5 U.S.C.
3132(a), or an equivalent appointment
made for similar purposes;
(5) A Veterans Recruitment
Appointment under 5 CFR part 307;
(6) A Presidential Management Fellow
appointment under 5 CFR 213.3102(ii)
and 5 CFR 213.3102(jj);
(7) A Federal Career Intern
appointment under 5 CFR 213.3202(o);
and
(8) An appointment under the
fellowship and similar programs
authority at 5 CFR 213.3102(r).
§ 537.103
plans.
Agency student loan repayment
Before providing student loan
repayment benefits under this part, an
agency must establish a student loan
repayment plan. This plan must include
the following elements:
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(a) The designation of officials with
authority to review and approve offering
student loan repayment benefits (which
may parallel the approval delegations
used for other recruitment, relocation,
and retention incentives);
(b) The situations in which the
student loan repayment authority may
be used;
(c) The criteria to meet or consider in
authorizing student loan repayment
benefits, including criteria for
determining the size and timing of the
loan payment(s);
(d) A system for selecting employees
(or job candidates) to receive student
loan repayment benefits that ensures
fair and equitable treatment;
(e) The requirements associated with
service agreements (including a basis for
determining the length of service to be
required if it is greater than the statutory
minimum);
(f) The procedures for making loan
payments;
(g) The provisions for recovering any
amount outstanding from an employee
who fails to satisfy a service agreement
and conditions for waiving an
employee’s obligation to reimburse the
agency for payments made under this
part; and
(h) Documentation and recordkeeping
requirements sufficient to allow
reconstruction of each action to approve
a student loan repayment benefit.
§ 537.104
Employee eligibility.
(a) Subject to the conditions in 5
U.S.C. 5379 and this part, an authorized
agency official may approve student
loan repayment benefits to recruit a
highly qualified job candidate or retain
a highly qualified employee who,
during the service period established
under a service agreement (consistent
with § 537.107), will be serving under—
(1) An appointment other than a timelimited appointment; or
(2) A time-limited appointment if—
(i) The employee (or job candidate)
will have at least 3 years remaining
under the appointment after the
beginning of the service period
established under a service agreement;
or
(ii) The time-limited appointment
authority leads to conversion to another
appointment of sufficient duration so
that his or her employment with the
agency is projected to last for at least 3
additional years after the beginning of
the service period established under a
service agreement.
(b) An employee occupying a position
that is excepted from the competitive
service because of its confidential,
policy-determining, policy-making, or
policy-advocating character is ineligible
for student loan repayment benefits.
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(c) An employee becomes ineligible
for student loan repayment benefits
under the conditions described in
§ 537.108.
§ 537.105
Criteria for payment.
(a) General criteria. Before authorizing
student loan repayment benefits for an
employee (or job candidate), an agency
must make a written determination
that—
(1) The employee (or job candidate) is
highly qualified and otherwise eligible
(as described in § 537.104); and
(2)(i) In a case where the
authorization is granted to recruit a job
candidate to fill an agency position, the
agency otherwise would encounter
difficulty in filling a position with a
highly qualified individual; or
(ii) In a case where the authorization
is granted to retain a current employee
of the agency, the employee otherwise is
likely to leave the agency for
employment outside the Federal service
and it is essential to retain the employee
based on the employee’s high or unique
qualifications or a special need of the
agency.
(b) Retention considerations. In
making a determination under
paragraph (a)(2)(ii) of this section, an
agency must consider the extent to
which the employee’s departure would
affect the agency’s ability to carry out an
activity or perform a function that is
deemed essential to its mission.
(c) Current Federal employees. An
agency may not authorize student loan
repayment benefits to recruit an
individual from outside the agency who
is currently employed in the Federal
service.
(d) Selecting employees. When
selecting employees (or job candidates)
to receive student loan repayment
benefits, agencies must ensure that
benefits are awarded without regard to
political affiliation, race, color, religion,
national origin, sex, marital status, age,
or handicapping condition.
§ 537.106 Conditions and procedures for
providing student loan repayment benefits.
(a) General conditions. (1) Student
loan repayment benefits may be
provided at the discretion of the agency
and are subject to such terms,
limitations, or conditions as may be
mutually agreed to in writing by the
agency and the employee (or job
candidate) as part of a service agreement
under § 537.107.
(2) The student loan to be repaid must
be a qualifying student loan as set forth
in paragraph (b) of this section.
(3) The agency must document in
writing each approval of student loan
repayment benefits. An authorized
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agency official must review and approve
each written determination. The written
determination must show the employee
(or job candidate) meets the criteria
specified in § 537.105.
(4) An authorized agency official must
approve student loan repayment
benefits in connection with a
recruitment action before the job
candidate actually enters on duty in the
position for which he or she was
recruited. The agency and the job
candidate may sign the service
agreement before the job candidate
begins serving in the position, but the
agency may not begin making loan
payments until the job candidate begins
serving in the position.
(5) Student loan repayment benefits
are in addition to basic pay and any
other form of compensation otherwise
payable to the employee involved.
(6) Appropriate tax withholdings
must be deducted or applied at the time
any payment is made. Since these tax
implications could create a financial
hardship for the recipient of the student
loan repayment benefit, agencies may
lessen the impact of tax withholdings on
an employee’s paycheck in one of the
following ways:
(i) Make smaller payments at periodic
intervals throughout the year, rather
than issue payments under this part in
one lump sum;
(ii) Allow the employee to write a
check to the agency to cover his or her
tax liability, rather than have the tax
liability withheld from the employee’s
paycheck;
(iii) Deduct the amount of taxes to be
withheld from the student loan
repayment benefit before the balance is
issued as a loan payment to the holder
of the loan.
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Note to § 537.106(a)(6): Contact the
Internal Revenue Service for further details
concerning these options, as well as the tax
withholding implications of payments under
this part.
(b) Qualifying student loans. (1) The
agency may make loan payments only
for student loan debts that are
outstanding at the time the agency and
the employee (or job candidate) enter
into a service agreement. Before
authorizing loan payments, an agency
must verify with the holder of the loan
that the employee (or job candidate) has
an outstanding student loan that
qualifies for repayment under this part.
The agency must verify remaining
balances to ensure that loans are not
overpaid.
(2) The agency may repay more than
one loan if the employee’s student loan
repayment benefit does not exceed the
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limits set forth in paragraph (c) of this
section.
(3) These regulations do not impose a
limit on the age of a student loan for
qualification purposes. The agency may,
however, specify in its agency plan that
only student loans made within a
certain timeframe are eligible for
repayment.
(c) Benefit amount. (1) In determining
the amount of student loan repayment
benefits to approve, an agency must
consider the employee’s (or job
candidate’s) value to the agency and
how far in advance the agency is
permitted to commit funds. If an agency
decides to make additional student loan
repayment benefits contingent on
budget levels or other factors, it must
address these contingent benefits in the
written service agreement as described
in § 537.107(a).
(2) The amount of student loan
repayment benefits provided by an
agency is subject to both of the
following limits:
(i) $10,000 per employee per calendar
year; and
(ii) A total of $60,000 per employee.
(3) In applying the limits in paragraph
(c)(2) of this section, the agency must
count the full student loan repayment
benefit (i.e., before deducting any tax
withholdings as described in paragraph
(a)(6)(iii) of this section).
(d) Employee responsibility. Loan
payments made by an agency under this
part do not exempt an employee from
his or her responsibility and/or liability
for any loan(s) the individual has taken
out. The employee also is responsible
for any income tax obligations resulting
from the student loan repayment
benefit.
§ 537.107
Service agreements.
(a) Before an employing agency makes
any loan payments for an employee, the
employee (or job candidate) must sign a
written service agreement to complete a
specified period of service with the
agency and to reimburse the agency for
the student loan repayment benefit
when required by § 537.109. The service
agreement also may specify any other
employment conditions the agency
considers to be appropriate, including
the employee’s (or job candidate’s)
position and the duties he or she is
expected to perform, his or her work
schedule, and his or her level of
performance. (See §§ 537.108 and
537.109.) The service agreement may
address the possibility that, during the
period the agreement is in effect, the
agency may modify the agreement to
provide student loan repayment benefits
in addition to those fixed in the
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agreement based on contingencies or
conditions specified in the agreement.
(b) The minimum period of service to
be established under a service
agreement is 3 years, regardless of the
amount of student loan repayment
benefits authorized. The agency and the
employee may mutually agree to modify
an existing service agreement, subject to
the limitations at § 537.106(c)(2), to
provide additional student loan
repayment benefits for additional
service without the need for an entirely
new service agreement (which would
require a new 3-year minimum service
period). 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 must be extended by
the total amount of time spent in nonpay status. However, as provided by 5
CFR 353.107, absence because of
uniformed service or compensable
injury is considered creditable toward
the required service period upon
reemployment.
(c) A service agreement made under
this part in no way constitutes a
promise of, or right or entitlement to,
appointment, continued employment, or
noncompetitive conversion to the
competitive service. This condition
should be stated in the service
agreement.
(d) The service period begins on the
date specified in the service agreement.
That beginning date may not be—
(1) Earlier than the date the service
agreement is signed; or
(2) Earlier than the date the individual
begins serving in the position for which
he or she was recruited (when student
loan repayment benefits are approved to
recruit a job candidate to fill an agency
position).
(e) The service agreement must
contain a provision addressing whether
the individual would be required to
reimburse the paying agency for student
loan repayment benefits if he or she
voluntarily separates from the paying
agency to work for another agency
before the end of the service period.
(See § 537.109(b)(2).)
(f) The agency may include in a
service agreement specific conditions
(in addition to those required by law)
that trigger the loss of eligibility for
student loan repayment benefits and/or
a requirement that the employee
reimburse the agency for student loan
repayment benefits already received.
(See §§ 537.108(a)(3) and 537.109(a)(2).)
However, a service agreement may not
require reimbursement based on—
(1) An employee’s failure to maintain
performance at a particular level (unless
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the employee is separated based on
unacceptable performance); or
(2) An involuntary separation for
reasons other than misconduct or
unacceptable performance (e.g., an
involuntary separation resulting from a
reduction in force or medical reasons).
§ 537.108 Loss of eligibility for student
loan repayment benefits.
(a) An employee receiving student
loan repayment benefits from an agency
is ineligible for continued benefits from
that agency if the employee—
(1) Separates from the agency;
(2) Does not maintain an acceptable
level of performance, as determined
under standards and procedures
prescribed by the agency; or
(3) Violates a condition in the service
agreement, if the agreement specifically
provides that eligibility is lost when the
condition is violated.
(b) For the purpose of applying
paragraph (a)(2) of this section, an
acceptable level of performance is one
that is equivalent to level 3 (‘‘Fully
Successful’’ or equivalent) or higher, as
described in 5 CFR 430.208(d). An
employee loses eligibility for student
loan repayment benefits if his or her
most recent official performance
evaluation does not meet this
requirement.
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§ 537.109 Employee reimbursements to
the Government.
(a) An employee is indebted to the
Federal Government and must
reimburse the paying agency for the
amount of any student loan repayment
benefits received under a service
agreement if he or she—
(1) Fails to complete the period of
service required in the applicable
service agreement (except as provided
by paragraph (b) of this section); or
(2) Violates any other condition that
specifically triggers a reimbursement
requirement under the agreement.
(b) An agency may not apply
paragraph (a) of this section based on an
employee’s failure to complete the
required period of service established
under a service agreement if—
(1) The employee is involuntarily
separated for reasons other than
misconduct or unacceptable
performance; or
(2) The employee leaves the paying
agency voluntarily to enter into the
service of any other agency, unless
reimbursement to the agency is
otherwise required in the service
agreement, as provided by § 537.107(e).
(c) If an agency and an employee
mutually agree to modify an existing
service agreement to provide additional
student loan repayment benefits for
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additional service (as provided by
§ 537.107(b)), the modified service
agreement may stipulate that, if the
employee completes the initial service
period but fails to complete the
additional service period, he or she is
required to reimburse the paying agency
only for the amount of any student loan
repayment benefits received during the
additional service period.
(d) If an employee fails to reimburse
the paying agency for the amount owed
under paragraph (a) of this section, a
sum equal to the amount outstanding is
recoverable from the employee under
the agency’s regulations for collection
by offset from an indebted Government
employee under 5 U.S.C. 5514 and 5
CFR part 550, subpart K, or through the
appropriate provisions governing
Federal debt collection if the individual
is no longer a Federal employee.
(e) An authorized agency official 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. (See 5 U.S.C.
5379(c)(3).)
(f) Any amount reimbursed by, or
recovered from, an employee under this
section must be credited to the
appropriation account from which the
amount involved was originally paid.
Any amount so credited must be merged
with other sums in such account and
must be available for the same purposes
and time period, and subject to the same
limitations (if any), as the sums with
which merged. (See 5 U.S.C. 5379(c)(4).)
§ 537.110
Records and reports.
(a) Each agency must keep a record of
each determination to provide student
loan repayment benefits under this part
and make such records available for
review upon request by OPM. Such a
record may be destroyed when 3 years
have elapsed since the end of the
service period specified in the
employee’s service agreement.
(b) By March 31st of each year, each
agency must submit a written report to
OPM containing information about
student loan repayment benefits it
provided to employees during the
previous calendar year. Each report
must include the following information:
(1) The number of employees who
received student loan repayment
benefits;
(2) The job classifications of the
employees who received student loan
repayment benefits; and
(3) The cost to the Federal
Government of providing student loan
repayment benefits.
[FR Doc. E7–101 Filed 1–8–07; 8:45 am]
BILLING CODE 6325–39–P
PO 00000
Frm 00005
Fmt 4702
Sfmt 4702
DEPARTMENT OF TRANSPORTATION
Federal Aviation Administration
14 CFR Part 39
[Docket No. FAA–2006–26696; Directorate
Identifier 2006–SW–19–AD]
RIN 2120–AA64
Airworthiness Directives; Robinson
Helicopter Company Model R44 and
R44 II Helicopters
Federal Aviation
Administration, DOT.
ACTION: Notice of proposed rulemaking
(NPRM).
AGENCY:
SUMMARY: This document proposes
adopting a new airworthiness directive
(AD) for robinson Helicopter Company
(Robinson) Model R44 and R44 II
helicopters that have a certain seat belt
buckle (buckle) assembly installed. The
AD would require removing the buckle
assembly and the buckle assembly
spacer, and replacing them with
airworthy parts. This proposal is
prompted by an accident in which a seat
belt failed, and also by reports of
cracking in the buckle assembly
stainless support strap (support strap).
The actions specified by the proposed
AD are intended to prevent cracking in
the support strap and failure of a seat
belt.
Comments must be received on
or before March 12, 2007.
ADDRESSES: Use one of the following
addresses to submit comments on this
proposed AD:
• DOT Docket Web site: Go to https://
dms.dot.gov and follow the instructions
for sending your comments
electronically;
• Government-wide rulemaking Web
site: Go to https://www.regulations.gov
follow the instructions for sending your
comments electronically;
• Mail: Docket Management Facility;
U.S. Department of Transportation, 400
Seventh Street, SW., Nassif Building,
Room PL–401, Washington, DC 20590;
• Fax: 202–493–2251; or
• Hand Delivery: Room PL–401 on
the plaza level of the Nassif Building,
400 Seventh Street, SW., Washington,
DC, between 9 a.m. and 5 p.m., Monday
through Friday, except Federal holidays.
You may get the service information
identified in this proposed AD from
Robinson Helicopter Company, 2901
Airport Drive, Torrance, California
90505, telephone (310) 539–0508, fax
(310) 539–5198.
You may examine the comments to
this proposed AD in the AD docket on
the Internet at https://dms.dot.gov.
DATES:
E:\FR\FM\09JAP1.SGM
09JAP1
]]>Agencies
[Federal Register Volume 72, Number 5 (Tuesday, January 9, 2007)]
[Proposed Rules]
[Pages 914-918]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E7-101]
========================================================================
Proposed Rules
Federal Register
________________________________________________________________________
This section of the FEDERAL REGISTER contains notices to the public of
the proposed issuance of rules and regulations. The purpose of these
notices is to give interested persons an opportunity to participate in
the rule making prior to the adoption of the final rules.
========================================================================
Federal Register / Vol. 72, No. 5 / Tuesday, January 9, 2007 /
Proposed Rules
[[Page 914]]
OFFICE OF PERSONNEL MANAGEMENT
5 CFR Part 537
RIN 3206-AK51
Repayment of Student Loans
AGENCY: Office of Personnel Management.
ACTION: Proposed rule.
-----------------------------------------------------------------------
SUMMARY: The Office of Personnel Management (OPM) is issuing proposed
regulations to revise the rules governing the authority to offer
student loan repayment benefits to current Federal employees or
candidates for Federal jobs when necessary to recruit or retain highly
qualified personnel. These revisions include certain policy changes and
clarifications to assist agencies in taking full advantage of the
Federal student loan repayment program.
DATES: Comments must be received on or before March 12, 2007.
ADDRESSES: Send or deliver comments to Jerome D. Mikowicz, Deputy
Associate Director for Pay and Leave Administration, Office of
Personnel Management, Room 7H31, 1900 E Street, NW., Washington, DC
20415-8200, FAX: (202) 606-0824, or e-mail at pay-performance-
policy@opm.gov.
FOR FURTHER INFORMATION CONTACT: Gene Holson by telephone at (202) 606-
2858; by fax at (202) 606-0824; or by e-mail at pay-performance-
policy@opm.gov.
SUPPLEMENTARY INFORMATION: The Office of Personnel Management (OPM) is
issuing proposed regulations to revise the rules implementing 5 U.S.C.
5379, which allow agencies to offer student loan repayment benefits to
current Federal employees or candidates for Federal jobs when necessary
to recruit or retain highly qualified personnel. The primary purpose of
this revision is to make part 537 more readable and usable. However, we
also are proposing substantive changes based on experience to date to
improve program administration in the agencies and promote alignment
between this authority and related authorities that support recruitment
and retention efforts. The following table lists, by specific
regulatory section, the proposed substantive changes and provides a
brief description of the purpose and/or effect of each change.
------------------------------------------------------------------------
Proposed rule Description of proposed change
------------------------------------------------------------------------
Sec. 537.102............... Definitions. The current language in the
definition of employee regarding the
exclusion of certain types of employees
would be moved to proposed Sec.
537.104, which deals with employee
eligibility.
New definitions of student loan repayment
benefit and loan payment would be added
to distinguish more clearly between the
benefit credited to the employee and the
loan payments made to a loan holder by
an agency.
Sec. 537.103(h)............ Documentation. The requirement for
documentation would be revised to cover
only actions taken to approve a student
loan repayment benefit. The current
language requires documentation in each
case in which an employee is
``considered'' for a student loan
repayment benefit.
Sec. 537.104............... Employee eligibility. Paragraph (a) would
revise the current language in Sec.
537.104 to clarify when an employee in a
time-limited appointment may receive
student loan repayment benefits.
Paragraph (b) would be modified to
incorporate language currently found in
the definition of employee.
Paragraph (c) would provide a cross
reference to the provisions of Sec.
537.108, which deal with loss of
eligibility for student loan repayment
benefits.
Sec. 537.105............... Criteria for payment. This section would
be rewritten to focus more clearly on
the criteria that must be met to justify
the approval of student loan repayment
benefits.
The provisions for written documentation
and the timing of recruitment-related
approvals would be clarified and moved
to Sec. 537.106, which deals with
payment conditions and procedures. (See
Sec. 537.106(a)(3) and (4).)
Current Federal employees. Proposed
paragraph (c) would provide that an
agency may not authorize student loan
repayment benefits to recruit an
individual from outside the agency who
is currently employed in the Federal
service. The intent of the student loan
repayment authority is to help agencies
recruit individuals for Federal service,
not to compete with other agencies for
current Federal employees. This
restriction would be consistent with
current OPM guidance and the rules
concerning inter-agency competition when
providing recruitment and retention
incentives under 5 CFR part 575.
Sec. 537.106(a)............ General conditions. These provisions
establish standards and requirements
necessary to provide for reasonable
uniformity across agencies, as required
by 5 U.S.C. 5379(g). Proposed paragraph
(a)(4) would clarify that a service
agreement may be signed before a job
candidate begins serving in the position
for which he or she was recruited. This
paragraph would also incorporate
language currently found in Sec.
537.105(b).
Sec. 537.106(b)............ Age of student loans. Proposed paragraph
(b)(3) would clarify that, although
these regulations do not impose a limit
on the age of a student loan, an agency
may specify in its own plan that only
student loans made within a certain
timeframe are eligible for repayment.
Sec. 537.106(c)(3)......... Benefit cap. A new paragraph would
clarify that the full gross amount of
the student loan repayment benefit
(before deducting any tax withholdings
from that gross amount) counts toward
the benefit cap.
Sec. 537.107(a)............ Contingent additional benefits. A new
sentence would clarify that a service
agreement may address the possibility
that the agency may modify the agreement
to provide student loan repayment
benefits in addition to those fixed in
the agreement based on contingencies or
conditions specified in the agreement.
For example, benefits in a later year
could be contingent on budget levels.
[[Page 915]]
Sec. 537.107(b)............ Agreement modifications. The current
sentence on ``increases'' and
``renewals'' would be removed. The
replacement sentence would clarify that
the agency and the employee may mutually
agree to modify a service agreement to
provide additional student loan
repayment benefits for additional
service without the need for a new
service agreement. (A new service
agreement would require additional
service of at least 3 years. In
contrast, an agreement modification
could, for example, add just 1 year of
additional service.) The possibility of
payment increases would now be addressed
in the new sentence added to paragraph
(a).
Periods in a non-pay status. A new rule
would provide that periods of leave
without pay, or other periods during
which the employee is not in a pay
status, would not count toward
completion of the required service
period. This means the originally
projected service completion date must
be extended by the total amount of time
spent in non-pay status. However, as
provided by 5 CFR 353.107, absence
because of uniformed service or
compensable injury is considered
creditable toward the required service
period upon reemployment.
Sec. 537.107(d)............ Service period commencement. A new
paragraph would be added to address when
a service period begins.
Sec. 537.107(e)............ Reimbursement provision in service
agreement. A new provision would require
agencies to include in any service
agreement a provision addressing whether
or not the individual will be required
to reimburse the agency for student loan
repayment benefits if he or she
transfers to a different agency during
the service period. (Also see proposed
Sec. 537.109(b)(2), which would
incorporate language currently found in
Sec. 537.109(d)(2).)
Sec. 537.108(a)............ Loss of eligibility. Proposed paragraph
(a)(3) would clarify that loss of
eligibility based on a condition in the
service agreement would occur only when
the agreement expressly states that a
violation of the condition will result
in the loss of eligibility.
Sec. 537.109(c)............ Reimbursement under a modified service
agreement. Current language would be
modified to clarify what would happen
when an agency and an employee mutually
agree to modify an existing service
agreement to provide additional student
loan repayment benefits for additional
service (e.g., a 4th year following an
initial 3-year service period). The
modified service agreement may stipulate
that if the employee completes the
initial service period but fails to
complete the additional service period,
he or she would be required to reimburse
the paying agency only for the amount of
any student loan repayment benefits
received during the additional service
period. (Also see proposed Sec.
537.107(b) regarding modified service
agreements.)
Sec. 537.110(a)............ Records retention. Current language would
be modified to clarify that a record on
a determination to provide student loan
repayment benefits must be retained for
at least 3 years after the end of the
employee's service period as specified
in the service agreement. We are
deleting the provision regarding an
earlier date linked to an OPM program
review because as a practical matter a
program review may not necessarily mean
each case is reviewed individually.
Sec. 537.110(b)............ Reports. A new provision would require
agencies to report on the student loan
repayment benefits they provided during
the previous calendar year rather than
during the previous fiscal year.
Currently, agencies are required to
report to OPM by the end of the calendar
year on the student loan repayment
benefits they provided during the
previous fiscal year. However, the law
imposes a calendar year limitation on
the amount of student loan repayment
benefits an agency may provide to an
employee. Also, we note agencies are
currently required to report to OPM on
their use of other recruitment and
retention flexibilities (e.g.,
recruitment, relocation, and retention
incentives under 5 CFR part 575) on a
calendar year basis. Therefore, we are
proposing this change to simplify
reporting requirements for agencies. The
proposed regulation would require
agencies to report to OPM by March 31st
of each year on their use of the student
loan repayment authority during the
previous calendar year.
In paragraphs (b)(1) and (b)(2), we
propose to replace ``employees selected
to receive'' with ``employees who
received'' because an individual may be
selected to receive student loan
repayment benefits during one reporting
period, but not actually receive
benefits until the following reporting
period. This change would be consistent
with our approach for reporting data on
student loan repayments in our annual
report to Congress.
------------------------------------------------------------------------
E.O. 12866, Regulatory Review
This rule has been reviewed by the Office of Management and Budget
in accordance with E.O. 12866.
Regulatory Flexibility Act
I certify that these regulations would not have a significant
economic impact on a substantial number of small entities because they
would apply only to Federal agencies and employees.
List of Subjects in 5 CFR Part 537
Administrative practice and procedure, Government employees,
Students, Wages.
U.S. Office of Personnel Management.
Linda M. Springer,
Director.
Accordingly, OPM is proposing to revise 5 CFR part 537 to read as
follows:
PART 537--REPAYMENT OF STUDENT LOANS
Sec.
537.101 Purpose.
537.102 Definitions.
537.103 Agency student loan repayment plans.
537.104 Employee eligibility.
537.105 Criteria for payment.
537.106 Conditions and procedures for providing student loan
repayment benefits.
537.107 Service agreements.
537.108 Loss of eligibility for student loan repayment benefits.
537.109 Employee reimbursements to the Government.
537.110 Records and reports.
Authority: 5 U.S.C. 5379(g).
Sec. 537.101 Purpose.
This part implements 5 U.S.C. 5379, which authorizes agencies to
establish a student loan repayment program for the purpose of
recruiting or retaining highly qualified personnel. Under such a
program, an agency may agree to repay (by direct payment to the loan
holder on behalf of the employee) all or part of any outstanding
qualifying student loan or loans previously taken out by a job
candidate to whom an offer of employment has been made, or by a current
employee of the agency.
Sec. 537.102 Definitions.
Agency has the meaning given that term in subparagraphs (A) through
(E) of 5 U.S.C. 4101(1).
Authorized agency official means the head of an Executive agency or
an official who is authorized to act for the head of the agency in the
matter concerned.
Employee means an employee of an agency who satisfies the
definition of the term in 5 U.S.C. 2105.
Loan payment means the net payment made by an agency to the holder
of a student loan (after deducting any tax withholdings that may be
made from the
[[Page 916]]
gross student loan repayment benefit credited to the employee).
Service agreement means a written agreement between an agency and
an employee (or job candidate) under which the employee (or job
candidate) agrees to a specified period of service in exchange for
student loan repayment benefits, subject to the conditions set forth
under this part.
Student loan means--
(1) A loan made, insured, or guaranteed under parts B, D or E of
title IV of the Higher Education Act of 1965; or
(2) 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.
Student loan repayment benefit means the benefit provided to an
employee under this part in which an agency repays (by a direct payment
on behalf of the employee) a qualifying student loan previously taken
out by such employee. The dollar value of this benefit is the gross
amount credited to the employee at the time of a loan payment to the
holder of the student loan, before deducting any employee tax
withholdings from that gross amount as described in Sec.
537.106(a)(6)(iii). A student loan repayment benefit is not considered
basic pay for any purpose.
Time-limited appointment means an appointment of temporary duration
including--
(1) A temporary appointment under 5 CFR part 316, subpart D, or
similar authority;
(2) A term appointment under 5 CFR part 316, subpart C, or similar
authority;
(3) An overseas limited appointment with a time limitation under 5
CFR part 301, subpart B;
(4) A limited term or limited emergency appointment in the Senior
Executive Service, as defined in 5 U.S.C. 3132(a), or an equivalent
appointment made for similar purposes;
(5) A Veterans Recruitment Appointment under 5 CFR part 307;
(6) A Presidential Management Fellow appointment under 5 CFR
213.3102(ii) and 5 CFR 213.3102(jj);
(7) A Federal Career Intern appointment under 5 CFR 213.3202(o);
and
(8) An appointment under the fellowship and similar programs
authority at 5 CFR 213.3102(r).
Sec. 537.103 Agency student loan repayment plans.
Before providing student loan repayment benefits under this part,
an agency must establish a student loan repayment plan. This plan must
include the following elements:
(a) The designation of officials with authority to review and
approve offering student loan repayment benefits (which may parallel
the approval delegations used for other recruitment, relocation, and
retention incentives);
(b) The situations in which the student loan repayment authority
may be used;
(c) The criteria to meet or consider in authorizing student loan
repayment benefits, including criteria for determining the size and
timing of the loan payment(s);
(d) A system for selecting employees (or job candidates) to receive
student loan repayment benefits that ensures fair and equitable
treatment;
(e) The requirements associated with service agreements (including
a basis for determining the length of service to be required if it is
greater than the statutory minimum);
(f) The procedures for making loan payments;
(g) The provisions for recovering any amount outstanding from an
employee who fails to satisfy a service agreement and conditions for
waiving an employee's obligation to reimburse the agency for payments
made under this part; and
(h) Documentation and recordkeeping requirements sufficient to
allow reconstruction of each action to approve a student loan repayment
benefit.
Sec. 537.104 Employee eligibility.
(a) Subject to the conditions in 5 U.S.C. 5379 and this part, an
authorized agency official may approve student loan repayment benefits
to recruit a highly qualified job candidate or retain a highly
qualified employee who, during the service period established under a
service agreement (consistent with Sec. 537.107), will be serving
under--
(1) An appointment other than a time-limited appointment; or
(2) A time-limited appointment if--
(i) The employee (or job candidate) will have at least 3 years
remaining under the appointment after the beginning of the service
period established under a service agreement; or
(ii) The time-limited appointment authority leads to conversion to
another appointment of sufficient duration so that his or her
employment with the agency is projected to last for at least 3
additional years after the beginning of the service period established
under a service agreement.
(b) An employee occupying a position that is excepted from the
competitive service because of its confidential, policy-determining,
policy-making, or policy-advocating character is ineligible for student
loan repayment benefits.
(c) An employee becomes ineligible for student loan repayment
benefits under the conditions described in Sec. 537.108.
Sec. 537.105 Criteria for payment.
(a) General criteria. Before authorizing student loan repayment
benefits for an employee (or job candidate), an agency must make a
written determination that--
(1) The employee (or job candidate) is highly qualified and
otherwise eligible (as described in Sec. 537.104); and
(2)(i) In a case where the authorization is granted to recruit a
job candidate to fill an agency position, the agency otherwise would
encounter difficulty in filling a position with a highly qualified
individual; or
(ii) In a case where the authorization is granted to retain a
current employee of the agency, the employee otherwise is likely to
leave the agency for employment outside the Federal service and it is
essential to retain the employee based on the employee's high or unique
qualifications or a special need of the agency.
(b) Retention considerations. In making a determination under
paragraph (a)(2)(ii) of this section, an agency must consider the
extent to which the employee's departure would affect the agency's
ability to carry out an activity or perform a function that is deemed
essential to its mission.
(c) Current Federal employees. An agency may not authorize student
loan repayment benefits to recruit an individual from outside the
agency who is currently employed in the Federal service.
(d) Selecting employees. When selecting employees (or job
candidates) to receive student loan repayment benefits, agencies must
ensure that benefits are awarded without regard to political
affiliation, race, color, religion, national origin, sex, marital
status, age, or handicapping condition.
Sec. 537.106 Conditions and procedures for providing student loan
repayment benefits.
(a) General conditions. (1) Student loan repayment benefits may be
provided at the discretion of the agency and are subject to such terms,
limitations, or conditions as may be mutually agreed to in writing by
the agency and the employee (or job candidate) as part of a service
agreement under Sec. 537.107.
(2) The student loan to be repaid must be a qualifying student loan
as set forth in paragraph (b) of this section.
(3) The agency must document in writing each approval of student
loan repayment benefits. An authorized
[[Page 917]]
agency official must review and approve each written determination. The
written determination must show the employee (or job candidate) meets
the criteria specified in Sec. 537.105.
(4) An authorized agency official must approve student loan
repayment benefits in connection with a recruitment action before the
job candidate actually enters on duty in the position for which he or
she was recruited. The agency and the job candidate may sign the
service agreement before the job candidate begins serving in the
position, but the agency may not begin making loan payments until the
job candidate begins serving in the position.
(5) Student loan repayment benefits are in addition to basic pay
and any other form of compensation otherwise payable to the employee
involved.
(6) Appropriate tax withholdings must be deducted or applied at the
time any payment is made. Since these tax implications could create a
financial hardship for the recipient of the student loan repayment
benefit, agencies may lessen the impact of tax withholdings on an
employee's paycheck in one of the following ways:
(i) Make smaller payments at periodic intervals throughout the
year, rather than issue payments under this part in one lump sum;
(ii) Allow the employee to write a check to the agency to cover his
or her tax liability, rather than have the tax liability withheld from
the employee's paycheck;
(iii) Deduct the amount of taxes to be withheld from the student
loan repayment benefit before the balance is issued as a loan payment
to the holder of the loan.
Note to Sec. 537.106(a)(6): Contact the Internal Revenue
Service for further details concerning these options, as well as the
tax withholding implications of payments under this part.
(b) Qualifying student loans. (1) The agency may make loan payments
only for student loan debts that are outstanding at the time the agency
and the employee (or job candidate) enter into a service agreement.
Before authorizing loan payments, an agency must verify with the holder
of the loan that the employee (or job candidate) has an outstanding
student loan that qualifies for repayment under this part. The agency
must verify remaining balances to ensure that loans are not overpaid.
(2) The agency may repay more than one loan if the employee's
student loan repayment benefit does not exceed the limits set forth in
paragraph (c) of this section.
(3) These regulations do not impose a limit on the age of a student
loan for qualification purposes. The agency may, however, specify in
its agency plan that only student loans made within a certain timeframe
are eligible for repayment.
(c) Benefit amount. (1) In determining the amount of student loan
repayment benefits to approve, an agency must consider the employee's
(or job candidate's) value to the agency and how far in advance the
agency is permitted to commit funds. If an agency decides to make
additional student loan repayment benefits contingent on budget levels
or other factors, it must address these contingent benefits in the
written service agreement as described in Sec. 537.107(a).
(2) The amount of student loan repayment benefits provided by an
agency is subject to both of the following limits:
(i) $10,000 per employee per calendar year; and
(ii) A total of $60,000 per employee.
(3) In applying the limits in paragraph (c)(2) of this section, the
agency must count the full student loan repayment benefit (i.e., before
deducting any tax withholdings as described in paragraph (a)(6)(iii) of
this section).
(d) Employee responsibility. Loan payments made by an agency under
this part do not exempt an employee from his or her responsibility and/
or liability for any loan(s) the individual has taken out. The employee
also is responsible for any income tax obligations resulting from the
student loan repayment benefit.
Sec. 537.107 Service agreements.
(a) Before an employing agency makes any loan payments for an
employee, the employee (or job candidate) must sign a written service
agreement to complete a specified period of service with the agency and
to reimburse the agency for the student loan repayment benefit when
required by Sec. 537.109. The service agreement also may specify any
other employment conditions the agency considers to be appropriate,
including the employee's (or job candidate's) position and the duties
he or she is expected to perform, his or her work schedule, and his or
her level of performance. (See Sec. Sec. 537.108 and 537.109.) The
service agreement may address the possibility that, during the period
the agreement is in effect, the agency may modify the agreement to
provide student loan repayment benefits in addition to those fixed in
the agreement based on contingencies or conditions specified in the
agreement.
(b) The minimum period of service to be established under a service
agreement is 3 years, regardless of the amount of student loan
repayment benefits authorized. The agency and the employee may mutually
agree to modify an existing service agreement, subject to the
limitations at Sec. 537.106(c)(2), to provide additional student loan
repayment benefits for additional service without the need for an
entirely new service agreement (which would require a new 3-year
minimum service period). 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 must be extended by the total amount of time spent in non-pay
status. However, as provided by 5 CFR 353.107, absence because of
uniformed service or compensable injury is considered creditable toward
the required service period upon reemployment.
(c) A service agreement made under this part in no way constitutes
a promise of, or right or entitlement to, appointment, continued
employment, or noncompetitive conversion to the competitive service.
This condition should be stated in the service agreement.
(d) The service period begins on the date specified in the service
agreement. That beginning date may not be--
(1) Earlier than the date the service agreement is signed; or
(2) Earlier than the date the individual begins serving in the
position for which he or she was recruited (when student loan repayment
benefits are approved to recruit a job candidate to fill an agency
position).
(e) The service agreement must contain a provision addressing
whether the individual would be required to reimburse the paying agency
for student loan repayment benefits if he or she voluntarily separates
from the paying agency to work for another agency before the end of the
service period. (See Sec. 537.109(b)(2).)
(f) The agency may include in a service agreement specific
conditions (in addition to those required by law) that trigger the loss
of eligibility for student loan repayment benefits and/or a requirement
that the employee reimburse the agency for student loan repayment
benefits already received. (See Sec. Sec. 537.108(a)(3) and
537.109(a)(2).) However, a service agreement may not require
reimbursement based on--
(1) An employee's failure to maintain performance at a particular
level (unless
[[Page 918]]
the employee is separated based on unacceptable performance); or
(2) An involuntary separation for reasons other than misconduct or
unacceptable performance (e.g., an involuntary separation resulting
from a reduction in force or medical reasons).
Sec. 537.108 Loss of eligibility for student loan repayment benefits.
(a) An employee receiving student loan repayment benefits from an
agency is ineligible for continued benefits from that agency if the
employee--
(1) Separates from the agency;
(2) Does not maintain an acceptable level of performance, as
determined under standards and procedures prescribed by the agency; or
(3) Violates a condition in the service agreement, if the agreement
specifically provides that eligibility is lost when the condition is
violated.
(b) For the purpose of applying paragraph (a)(2) of this section,
an acceptable level of performance is one that is equivalent to level 3
(``Fully Successful'' or equivalent) or higher, as described in 5 CFR
430.208(d). An employee loses eligibility for student loan repayment
benefits if his or her most recent official performance evaluation does
not meet this requirement.
Sec. 537.109 Employee reimbursements to the Government.
(a) An employee is indebted to the Federal Government and must
reimburse the paying agency for the amount of any student loan
repayment benefits received under a service agreement if he or she--
(1) Fails to complete the period of service required in the
applicable service agreement (except as provided by paragraph (b) of
this section); or
(2) Violates any other condition that specifically triggers a
reimbursement requirement under the agreement.
(b) An agency may not apply paragraph (a) of this section based on
an employee's failure to complete the required period of service
established under a service agreement if--
(1) The employee is involuntarily separated for reasons other than
misconduct or unacceptable performance; or
(2) The employee leaves the paying agency voluntarily to enter into
the service of any other agency, unless reimbursement to the agency is
otherwise required in the service agreement, as provided by Sec.
537.107(e).
(c) If an agency and an employee mutually agree to modify an
existing service agreement to provide additional student loan repayment
benefits for additional service (as provided by Sec. 537.107(b)), the
modified service agreement may stipulate that, if the employee
completes the initial service period but fails to complete the
additional service period, he or she is required to reimburse the
paying agency only for the amount of any student loan repayment
benefits received during the additional service period.
(d) If an employee fails to reimburse the paying agency for the
amount owed under paragraph (a) of this section, a sum equal to the
amount outstanding is recoverable from the employee under the agency's
regulations for collection by offset from an indebted Government
employee under 5 U.S.C. 5514 and 5 CFR part 550, subpart K, or through
the appropriate provisions governing Federal debt collection if the
individual is no longer a Federal employee.
(e) An authorized agency official 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. (See 5 U.S.C. 5379(c)(3).)
(f) Any amount reimbursed by, or recovered from, an employee under
this section must be credited to the appropriation account from which
the amount involved was originally paid. Any amount so credited must be
merged with other sums in such account and must be available for the
same purposes and time period, and subject to the same limitations (if
any), as the sums with which merged. (See 5 U.S.C. 5379(c)(4).)
Sec. 537.110 Records and reports.
(a) Each agency must keep a record of each determination to provide
student loan repayment benefits under this part and make such records
available for review upon request by OPM. Such a record may be
destroyed when 3 years have elapsed since the end of the service period
specified in the employee's service agreement.
(b) By March 31st of each year, each agency must submit a written
report to OPM containing information about student loan repayment
benefits it provided to employees during the previous calendar year.
Each report must include the following information:
(1) The number of employees who received student loan repayment
benefits;
(2) The job classifications of the employees who received student
loan repayment benefits; and
(3) The cost to the Federal Government of providing student loan
repayment benefits.
[FR Doc. E7-101 Filed 1-8-07; 8:45 am]
BILLING CODE 6325-39-P
