The bill aimed to approve a $40 million bond that would be used to administer the student loan debt relief program. The Finance Authority of Maine would administer such a program. If the bill had received the necessary number of votes on Thursday, July 20, then the $40 million bond would have been presented to voters in November for approval.
However, the legislative votes needed for a November vote did not materialize. On Thursday, the Maine Senate voted 16-14 for the bill, while the House voted 74-58 for the bill. However, each vote fell well short of the two-thirds margin needed for the bill to succeed as stated in the state constitution.
The Maine House of Representatives tabled the bill and it will seemingly be revisiting in early August when the Legislature reconvenes.
If the bill was to pass through the Maine Legislature with Maine’s voters following up with approval, $40 million in bond money would be put towards erasing the student loan debt of qualified participants. People who would receive the benefit would have to agree to live and work in Maine for a minimum of five years.
The bill’s sponsor, Democratic Representative Nate Libby, believes the student-debt relief program would ease the burden of student debt on Maine workers.
“Student loan debt is an enormous burden on an entire generation of Maine working people. In Maine, we have the 14th-highest rate of student debt in the nation,” said Libby.
Student debt harms the Maine economy as borrowers must make monthly payments towards their educational loans instead of spending their income on things like homes and cars.
Libby’s bill has bipartisan support in Maine. Republican Governor Paul LePage supports the student-debt relief program, mainly because he believes it will attract a younger workforce to the aging Maine population.
Speaking to WGAN Radio, LePage had the following to say, “We don’t have enough workers. This is a critical problem in Maine and it’s getting worse. This is an attempt to attract young professionals, people with trades and advanced degrees, to come to Maine, live and work here and we’ll help you pay off your student debt.”
The exact details of how the program would work would be ironed out after the bill was voted on by the people of Maine. Details that would need to be figured out include the amount of debt forgiveness available to a person, whether or not a person would need to graduate from college, and what actions would warrant a breach in contract.
Many Republicans in Maine oppose the bill as they do not think the state has the necessary financial resources available to support a $40 million bond. Also, many believe that student debtors made a commitment to pay off their student loans, and that burden should not fall to the taxpayers.
The average student loan debt in Maine is $30,000 per student loan borrower. In comparison, the average debt per borrower in the entire U.S. is $28,400, according to LendEDU. Currently, there are 43.3 million student loan borrowers in the U.S. that hold a collective student loan debt total of roughly $1.41 trillion.
Author: Dave Rathmanner
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