Wyden, Merkley Introduce Bill to Pause Student Loans for Federal Workers, Contractors, and Military During Ongoing Trump Shutdown

Wyden, Merkley Introduce Bill to Pause Student Loans for Federal Workers, Contractors, and Military During Ongoing Trump Shutdown

Washington, D.C. - U.S. Senators Ron Wyden and Jeff Merkley, both D-Ore., said today they are introducing legislation that would pause student loan payments for federal workers when a federal government shutdown lasts longer than two weeks.

"While Donald Trump and his Republican yes-men aren't lifting a finger to stop their government shutdown, federal workers continue to experience more financial pain," Wyden said. "Federal workers in Oregon and nationwide shouldn't have to suffer because of failed Republican leadership. That's why I am proud to support this bill to help every federal worker pay their bills."

"Folks who sign up to be public servants shouldn't have to worry about choosing between putting food on the table for their families and making student loan payments," Merkley said. "This is the Republican vision of 'Families Lose, Billionaires Win'-higher health care costs, less affordable student loan repayment plans, and more pressure on working families. I'll keep fighting to make sure working people-not billionaires-come first."

If passed, this legislation would take immediate effect for the current Republican shutdown, which has lasted more than a month.

Specifically, the Shutdown Student Loans for Feds Act would:

• Require the Department of Education to pause student loan payments for federal workers if a federal government shutdown lasts longer than two weeks - including the current lapse in appropriations.
• Ensure these loans would not accrue interest, and borrowers would continue to be in good standing for forgiveness programs like Public Service Loan Forgiveness, Student Loan Repayment Program, or Retention through Educational Advancement Program.
• Ensure the pause for federal workers has no impact on credit reporting.
• Directs the Secretary to deem each month for which a loan payment was suspended as if the borrower had made a payment for the purposes of student loan forgiveness programs.
• Authorize the Secretary to issue a refund for a covered individual for any loan payment already made (if they already paid this month), if requested (to give borrowers flexibility as some may want to voluntarily pay during a period where interest is frozen).
• Would apply to all federal employees (furloughed and excepted), members of the military, and federal contractors.

This bill was led by Senators Angela Alsobrooks, D-Md., and Chris Van Hollen, D-Md., and U.S. Representative Sarah Elfreth, D-Md. In addition to Wyden and Merkley, the legislation was cosponsored by Senators Mark Warner, D-Va., Elizabeth Warren, D-Mass., Richard Blumenthal, D-Conn., Mazie Hirono, D-Hawai'i., Andy Kim, D-N.J., Edward Markey, D-Mass., and Ben Ray Luján, D-N.M.

The text of the bill is here.