School districts should be wary of private companies offering assistance, Camilleri says
LANSING (April 11, 2024) — With a deadline fast approaching, State Sen. Darrin Camilleri (D-Trenton), the Senate Chair of the Pre-K-12 Education Budget, is urging the Michigan Department of Education to open additional application periods for school districts to take advantage of the state’s Student Loan Repayment Program grants for educators.
Local and intermediate school districts have until today, April 11, to apply for funding through the Section 27k Student Loan Repayment Program, which provides $200 to $400 per month to eligible school employees currently paying on their student loans.
“The current year’s budget provides $225 million to help ease the financial burden of Michigan’s hardworking educators — and there’s still plenty of funding remaining,” Camilleri said. “Our goal in providing this funding is to help school districts improve compensation for their educators so they can attract and retain high-quality staff. That’s why I’m calling on the Michigan Department of Education to open additional application periods so we can help as many educators as possible, and to ensure rules, procedures and guidelines are clear to help districts and educators take advantage of this funding.”
In addition, Camilleri is warning school districts to exercise caution when using private vendors to “help” school employees with federal student loan relief. One company, Fiducius, is being paid by many school districts to administer this process for them, but is asking for unrequired personal information in what should be a free and easy process.
“Many school districts are contracting with companies to administer this debt relief program, not realizing that there could be long-term costs to employees, especially if they are steered into private debt consolidation loans that make them ineligible for federal relief,” Camilleri said. “What’s more, some of these private firms are collecting a trove of unnecessary personal data from applicants – including W-2s, pay stubs and tax returns – none of which is necessary to access federal student loan relief programs. Such actions should stop, and MDE should clarify published rules to ensure it’s known that such documents are unnecessary in this process.
“It is imperative that school districts protect their employees from being taken advantage of by unscrupulous financial services profiteers,” Camilleri said. “These companies are making a profit off Michigan taxpayers while mining educators’ private information and increasing risk of identity theft.”
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