Public Service Loan Forgiveness: DOD and Its Personnel Could Benefit from Additional Program Information
Fast Facts
The Public Service Loan Forgiveness program is intended to encourage people to enter public service. It forgives the federal student loan balances of eligible borrowers who have made at least 10 years of payments while in certain public service jobs.
The Department of Education denied 94% of program applicants from the Department of Defense. (We previously found a 99% denial rate for all applicants.) The most common denial reasons were not enough payments and incomplete applications.
We made 5 recommendations for DOD and Education to increase awareness of the program and its requirements by sharing information and collaborating with each other.
Few Department of Defense applicants were approved for the Public Service Loan Forgiveness program.
Highlights
What GAO Found
Personnel in the Department of Defense (DOD)—including service members and civilian employees—may be eligible for federal student loan forgiveness through the Public Service Loan Forgiveness (PSLF) program if they remain in public service employment for 10 years while making 120 qualifying loan payments, among other requirements. As of January 2020, Department of Education (Education) data show that 287 DOD borrowers received loan forgiveness, while 5,180 DOD borrowers (about 94 percent) were denied (see figure). The most common reasons for the denials were not enough qualifying payments and missing information on the form. GAO previously reported in September 2019 an overall denial rate of 99 percent for all PSLF applications submitted by borrowers. More information from DOD could help potential applicants be aware of all eligibility requirements.
Number of Department of Defense (DOD) Personnel Approved or Denied for Public Service Loan Forgiveness (PSLF), as of January 31, 2020
Note: The “Civilian” categories include all civilian employees within DOD, including the military services.
As its administrator, Education has specialized knowledge about the PSLF program but has not shared complete information with DOD. Education officials have not shared with DOD summary information about its personnel who have taken steps to pursue PSLF or service members who may be eligible. Education officials also stated they have not shared the benefits of using the PSLF program together with DOD's student loan repayment program. Education officials have also not updated the student loan guide for service members with specific information on PSLF. Education could take additional steps to improve information sharing about PSLF with DOD personnel. DOD officials expressed interest in obtaining more program information. Collaboration among the departments and updated program information could help DOD officials and its personnel to take full advantage of PSLF.
DOD does not widely use the PSLF program for recruitment and retention to promote readiness despite facing challenges in certain specialty career fields. Some DOD officials we interviewed stated that they preferred to use other DOD benefits and incentives that DOD directly controls, such as bonuses or DOD's student loan repayment program. DOD could enhance its recruitment and retention efforts to promote readiness with department-wide and service-specific guidance about how the PSLF program could be used as a tool for such efforts.
Why GAO Did This Study
At a time when student loan debt continues to mount for many, the PSLF program—established in 2007 and administered by Education—is intended to encourage individuals to pursue careers in public service.
Senate Report 116-48 included a provision for GAO to study the effectiveness of the PSLF program at promoting military and civilian recruitment and retention as well as military readiness. GAO's report assesses the extent to which (1) DOD personnel pursue and receive loan forgiveness through the PSLF program, (2) Education has shared information with DOD officials and its military and civilian personnel about the program, and (3) DOD uses the program for recruitment and retention to promote readiness.
GAO analyzed student loan data from Education and the PSLF servicer from the beginning of the program through January 2020; reviewed relevant laws, documents, and other information related to PSLF, benefits, recruitment, retention, and readiness; and interviewed DOD and Education officials.
Recommendations
GAO is making five recommendations to increase information sharing about the PSLF program. These include that DOD provide information to its personnel and issue guidance to its officials about the program, and that Education and DOD collaborate to share information about the program. Education concurred and DOD partially concurred with the recommendations, which GAO continues to believe are valid, as discussed in the report.
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| Department of Defense | The Secretary of Defense should ensure that the Under Secretary of Defense for Personnel and Readiness shares additional information about the PSLF program, including its eligibility requirements and application process, with DOD military and civilian personnel. For example, DOD could update its benefits webpages to include details on the program's eligibility requirements and application process. (Recommendation 1) |
The Department of Defense (DOD) partially concurred with this recommendation. As of September 2024, DOD has provided documentation of various efforts to provide information about PSLF to both military and civilian personnel. For example, DOD's Office of Financial Readiness (OFR) posted Department of Education's PSLF Factsheet on its website, and the Defense Civilian Personnel Advisory Services updated its PSLF benefits webpage with link to Education's online PSLF program information and a PSLF presentation from Education. OFR also posted social media content with PSLF information throughout 2022. DOD issued DOD Instruction 1322.34, Financial Readiness of Service Members, in November 2021, with standardized learning objectives on education financing, benefits, and repayment options. DOD also published guidance via the Inventory of Financial Literacy Knowledge and Skills for Service Members and Families specifying inclusion of PSLF program information in mandatory training, and a DOD review confirmed its inclusion in service materials. Deputy Secretary of Defense provided information on temporary changes to PSLF in a message to the force on PSLF in September 2022. In addition, each service has provided online information about PSLF, either through informational articles or links to information about student loan programs. By expanding awareness of the PSLF program, DOD has the potential to encourage larger numbers of DOD personnel with federal student loans to participate in the program and continue their careers at DOD. This recommendation is closed as implemented.
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| Department of Education | The Secretary of Education should ensure that the Chief Operating Officer of the Office of Federal Student Aid collaborates with officials in the Office of the Under Secretary of Defense for Personnel and Readiness to share information about the PSLF program, including current information on program participation and eligibility, PSLF program requirements, and the potential to pursue PSLF and DOD's student loan repayment. For example, Education and DOD could use interagency groups or agreements to help improve information sharing among department officials and with military and civilian personnel. (Recommendation 2) |
The Department of Education concurred with this recommendation and reported in April 2023 that it had periodically met with officials from DOD and other federal agencies to share information about the PSLF program. For example, Education officials delivered a presentation on PSLF in September 2022 for an Office of Personnel Management webinar that was attended by members of the DOD community. This hour-long presentation included details about the PSLF eligibility requirements, application process, and additional tips and resources. Education officials have also provided information and updates about PSLF at quarterly meetings of the Principles of Excellence Working Group, which includes representatives from DOD. Education discussed the PSLF program at multiple working group meetings in 2022 and 2023.
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| Department of Defense | The Secretary of Defense should ensure that the Under Secretary of Defense for Personnel and Readiness collaborates with officials in Education's Office of Federal Student Aid to disseminate information about the PSLF program, including current information on program participation and eligibility, PSLF program requirements, and the potential to pursue PSLF and DOD's student loan repayment. For example, DOD and Education could use interagency groups or agreements to help improve information sharing among department officials and with military and civilian personnel. (Recommendation 3) |
The Department of Defense (DOD) partially concurred with this recommendation. As of September 2024, DOD has provided documentation of efforts together with Department of Education to disseminate information about PSLF to DOD personnel. For example, DOD's Office of Financial Readiness (OFR) posted Education's PSLF Factsheet on its website, and the Defense Civilian Personnel Advisory Services (DCPAS) updated its PSLF benefits webpage with a link to Education's online PSLF program information and a PSLF presentation by Education. OFR and Education collaborated on webinars and presentations by Education officials which included information about the PSLF program, among other financial and educational services. DOD officials have also participated in Financial Literacy and Education Commission's Postsecondary Working Group meetings, an interagency forum composed multiple federal agencies including Education, and DOD disseminated PSLF information provided through this group. Specifically, DCPAS disseminated PSLF-related messages to its human resources practitioners that included information on Education's resources and other federal government materials about the PSLF program. Enhanced collaboration between Education and DOD could benefit DOD personnel by making available more information about PSLF, including ways to take full advantage of the program and its benefits. This recommendation is closed as implemented.
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| Department of Education | The Secretary of Education should ensure that the Chief Operating Officer of the Office of Federal Student Aid updates the student loan guide for service members to provide information on applying for the PSLF program and its temporary expanded process, as well as the steps borrowers can take to count their annual payment from DOD's student loan repayment program as multiple qualifying payments for the PSLF program. (Recommendation 4) |
The Department of Education concurred with this recommendation and has produced an updated draft of the student loan guide for service members. These updates include additional information about the PSLF program and the steps borrowers can take to count payment from DOD's student loan repayment program towards the PSLF program. The department presented this updated draft to representatives from DOD and other federal agencies at the January 2023 meeting of the Principles of Excellence Working Group. However, Education has yet to finalize these updates and make the revised guide publicly available. Education officials said in March 2024 that the department would be incorporating the information from the updated guide onto its studentaid.gov website within the next few months. Officials said that having the information directly available on the website would provide greater accessibility than the previous brochure/pdf format. We will consider closing this recommendation once this important information is readily available to service members.
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| Department of Defense | The Secretary of Defense should ensure that the Under Secretary of Defense for Personnel and Readiness issues guidance to DOD and military service officials, such as front-line managers and human resources employees, about how the PSLF program could be used as a tool for recruitment and retention to promote readiness. (Recommendation 5) |
The Department of Defense partially concurred with this recommendation. According to DOD, once an updated link to PSLF program information has been provided by Department of Education personnel and DOD has incorporated it into its benefits website, DOD's military and civilian personnel offices plan to disseminate a message to DOD's human resources community advising of the PSLF program and website and asking them to share these with their service recruiters, hiring managers, and employees. In September 2022, the Defense Civilian Personnel Advisory Services (DCPAS) updated its PSLF benefits webpage with a presentation from FSA on PSLF and a link to the Department of Education's online PSLF program information. DCPAS also provided a list of online resources related to PSLF to its civilian personnel policy council members for dissemination to human resource practitioners. As of December 2023, the agency has not taken additional action, particularly on potential use of the program as a tool for recruitment and retention. When the agency takes further action, we will update the status accordingly.
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