Count me as one of those discouraged, slouching, increasingly jaded (pre-Rahm) supporters of President Obama. I watched the State of the Union address last month hoping to see the president call out some fools and come correct on a number of issues. What I wasn’t expecting was his heartening mention of changes to federal income-based loan repayment.

Since 2006, the prospect of “IBR,” as set forth under the College Cost Reduction and Access Act, has captured the attention of public interest law students and L-school advisors, not to mention their counterparts in other areas of higher education. It sounded so simple – rewarding former students for giving their skills and training back to the community – but the legislative advocacy behind CCRAA was tireless and probably has not received due credit. In July 2009, the law went into effect, implementing income-based/income-contingent/public service loan repayment. Just the words “income-based repayment” make me happier, but in conversations with peers and friends – particularly among public interest lawyers 3 or more years out of law school – I sense the word has not gotten out effectively to struggling P.I. folks.

This coming week Equal Justice Works will continue its leadership role in advocating and educating about IBR. Their webinar Getting Your Student Loans Forgiven: How government and nonprofit employees can earn public service loan forgiveness is ’sold out,’ (repeat offering on March 31), but TeamGG has a ticket and every intention of talking up the IBR option. Admittedly, we may be overestimating its impact and potential, but this State of the Union cameo should add optimism:

And let’s tell another one million students that when they graduate, they will be required to pay only 10 percent of their income on student loans, and all of their debt will be forgiven after 20 years – and forgiven after 10 years if they choose a career in public service, because in the United States of America, no one should go broke because they chose to go to college.

The president wants to expand debt forgiveness for graduates, and while his party doesn’t always help him out, he must view this issue as a gimme. (Consider that immigration reform, with so much energy behind it, didn’t get one second of time in the speech.) These few words and round numbers were meant to resonate with “the masses” at home, but even for those versed in loan repayment assistance programs, the numbers carry significance. The figure of “10 percent” would mark a five-percent decrease from the CCRAA’s hard-won income-percentage. The “20 years” figure is down from 25. (The master rhetorician that he is, Obama mentioned the 10-year public service option even though it is no different from what was passed back in 2007.) For those of you skipping lunch and dinner the same week you are diligently paying off student loans, these improvements couldn’t come about any faster.

The Jobs Bill… and you
I grabbed that header from Inc.com, by the way, because there shouldn’t be any public interest lawyers out there, particularly directors, ignoring this legislation’s implications – they would go well beyond unemployment insurance and “green jobs.” Two of the core facets of the bill, as it stands in the Senate (link to pdf), are a $5,000 pay-roll tax exemption for new, non-replacement hires and a $1,000 tax credit for retaining recent hires.

If you are a public interest lawyer who has been waiting for an interview for a long time – or an executive director who keeps putting off hiring needs – maybe you should call up Harry Reid and your local Congress members and tell them how much you need this kind of incentivizing in the job market. The bill is still tough on the jobless: to be eligible for the pay-roll tax exemption, a public interest law firm or organization would have to be hiring someone who worked fewer than 40 hours in the 60-day period preceding her first day on the job. That is some crazy desperate unemployment.

LSC in the House
As PSLawNet Blog picked up, the Legal Services Corporation recently made an appearance before the House Appropriations Subcommittee to support their FY 2011 budget request. LSC is asking for over 516 million dollars, a boost of nearly $100M from FY 2010. This increase would almost entirely impact LSC’s ability to fund legal services organizations that assist in foreclosure and housing-related cases. LSC believes it needs $484.9M in Basic Field Grants. That amount is nearly $65M greater than the entire FY 2010 budget and almost $85M above the entire FY 2009 budget. The big ask is meant to prevent LSC programs from having to turn away “two people for every client served.”

Although the FY 2010 budget had raised funding for loan repayment assistance programs by $50K (up to a whopping… one million dollars), the FY 2011 budget does not seek a similar increase. Which is kind of deflating until you think back to how deep this the foreclosure crisis has become.

LSC is betting its budget on Congressional support for legal services that will clean up the mess of banks and lenders. It’s also betting on how well all you P.I. folks learned secured transactions and mortgages back in law school.

Yes, that was a joke.

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About this contributor:  Zafar is a lawyer/activist and itinerant blogger based in Baltimore, Maryland. He graduated from American University Washington College of Law in 2008 and is former Co-Chair of The United People of Color Caucus of the National Lawyers Guild. Catch his twitter feed @Z4F4R. Read more from this contributor

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