RD Instruction 2051-C

Table of Contents

PART 2051 - HOURS AND PAY

Subpart C -- Student Loan Repayment Program

## [Table of Contents]{.underline}

[Section]{.underline} [Page]{.underline}

2051.65 Purpose. 1

2051.66 Legal Authorities. 1

2051.67 Responsibilities. 1

2051.68 Delegation of authority. 1

2051.69 Definitions. 1

2051.70 Eligibility requirements. 2

2051.71 Criteria for repayment of student loans

and approving documents. 3

2051.72 Service agreements and repayments. 5

2051.73 Student loan payment waivers. 6

2051.74 Records. 7

2051.75 Reports. 7

Exhibit A -- Sample Recommendation and Approval of the Repayment

> of Student Loan

Exhibit B -- Sample Service Agreement for a Receipt of Repayment

> of Student Loan

Exhibit C -- Reports and Records

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> RD Instruction 2051-C

Part 2051 -- HOURS AND PAY

SUBPART C -- Student Loan Repayment Program

§ 2051.65 [Purpose]{.underline}.

This instruction supplements Departmental Regulation No. 4050-537,
Repayment of Student Loans dated September 1, 2004.

§ 2051.66 [Legal authorities]{.underline}.

The instructions contained in this supplement and the Departmental
Regulation 4050-537 constitutes the United States Department of
Agriculture (USDA) and Rural Development's Student Loan Repayment
Program. This plan meets the requirements set forth in 5 CFR Part 537,
Repayment of Student Loans.

§ 2051.67 [Responsibilities]{.underline}.

\(a\) The Assistant Administrator for Human Resources is responsible for
setting policy and providing technical guidance and direction for Rural
Development's Student Loan Repayment Program.

\(b\) It is the responsibility of the management official to check the
sites referenced in this instruction before making any decisions to
grant student loan repayments since updates will occur.

§ 2051.68 [Delegation of authority]{.underline}.

Authority to approve repayment of student loans has been delegated to
the Deputy Administrator for Operations and Management (DOAM). The
authority may be redelegated to the Assistant Administrator for Human
Resources, the Chief, Headquarters Services Branch, and the Chief, Field
Services Branch in

St. Louis, Missouri.

§ 2051.69 [Definitions]{.underline}.

> [Agency]{.underline}. Rural Development, a mission area under USDA.

DISTRIBUTION: WSAL Human Resources

Hours and Pay

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§ 2051.69 (Con.)

> [Employee]{.underline}. For purposes of repaying a student loan,
> employee means a candidate who will be appointed to a job, who is
> highly qualified, who is eligible for student loan repayment if all
> other conditions are met; positions which are excepted from the
> competitive service because of their confidential, policy-determining,
> policy-making, or policy advocating character, i.e., employees serving
> under Schedule C appointments or non-career Senior Executive Service
> appointments are exempt from this program.
>
> [Involuntarily separated]{.underline}. A separation initiated by an
> agency against the employee\'s will and without his or her consent,
> for reasons other than cause on charges of misconduct or delinquency.
> An involuntary separation includes a separation resulting from the
> employee\'s actual inability to do the work following genuine efforts
> to do so, but does not include a separation under 5 CFR Part 752
> (Adverse Actions), or an equivalent procedure for reasons that involve
> culpable wrongdoing on the part of the employee. In addition, when an
> employee is separated because he or she declines to accept
> reassignment outside his or her commuting area, the separation is
> involuntary if the employee\'s position description or other written
> agreement does not provide for such reassignment. However, an
> employee\'s separation is not involuntary if, after such a written
> mobility agreement is added, the employee accepts one reassignment
> outside his or her commuting area, but subsequently declines another
> such reassignment.
>
> [Service agreement]{.underline}. In conjunction with repayment of a
> student loan, means a written agreement between Rural Development and
> an employee under which the employee agrees to a specified period of
> employment with the Agency in return for repayment of a student loan.
>
> [Student loan]{.underline}. A loan made, insured or guaranteed under
> parts B, D, or E of Title IV of the Higher Education Act of 1965, or a
> health education assistance loan made or insured under Part A of Title
> VII of the Public Health Service Act, or under Part E of Title VIII of
> that Act. A list
>
> of qualifying student loans can be found at the following internet
> sites: <http://www.opm.gov/oca/pay/StudentLoan/> or Departmental
> Regulation,
> <http://www.ocio.usda.gov/directives/files/dr/DR4050-537.htm>.

§ 2051.70 [Eligibility requirements]{.underline}.

Employees who hold the following types of appointments are eligible to
receive repayments for student loans:

\(a\) Temporary employees who are serving on appointments leading to
conversion to term or permanent appointments; or

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RD Instruction 2051-C

§ 2051.70 (Con.)

\(b\) Term employees with at least 3 years left on their appointment; or

\(c\) Permanent employees; or

\(d\) Employees serving on excepted appointments with conversion to
term, career, or career-conditional appointments (including, but not
limited to, Career Interns, Presidential Management Fellows, Senior
Presidential Management Fellows or Student Educational Employment
Program-Student Career Experience Program students).

§ 2051.71 [Criteria for repayment of student loans and approving
documents]{.underline}.

\(a\) Loan repayments must be based on a written determination that, in
the absence of offering loan repayment benefits, it would be difficult
to fill the position with a highly qualified candidate. Please reference
attached Exhibit A, "Sample Recommendation and Approval of the Repayment
of Student Loan(s)." This form will assist you in assuring that all of
the required information is provided to the approving official.

\(b\) Each determination for recruitment purposes, including the amount
to be paid, [must]{.underline} be made before the employee actually
enters on duty in the position for which he or she was recruited.

\(c\) The determination that repayment of a student loan may be paid may
be made before the recruitment or announcement takes place or after such
activity takes place.

\(d\) Payments authorized in order to recruit an employee must be based
upon a written determination that the high or unique qualifications of
the employee, or special need of the agency for the employee's services,
makes it essential to recruit the employee, and that in the absence of
offering student loan repayment benefits, the employee would be likely
to accept employment outside the Federal service. This determination
must be based on a written description of the extent to which the
employee's declination of a job offer would affect the agency's ability
to carry out an activity or perform a function that is deemed essential
to an agency's mission.

\(e\) Rural Development is authorizing use of this authority **only** as
a recruitment incentive for highly-qualified candidates where there has
been documented difficulty in recruiting for such candidates. Rural
Development is not authorizing use of this program as a retention
incentive for current employees.

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§ 2051.71 (Con.)

\(f\) An employee who receives a student loan repayment and moves to
another Federal agency, or USDA agency, or Rural Development
organization, is not obligated to repay the benefit, unless the employee
has agreed to make a repayment in these circumstance. The gaining agency
is not obligated to reimburse the losing agency for the amount of the
student loan.

\(g\) Management officials must adhere to merit system principles and
take into consideration the need to maintain a balanced workforce in
which women and members of racial and ethnic minority groups are
appropriately represented.

\(h\) Payments will be at the discretion of the DAOM, or to whomever the
DOAM has redelegated the authority, and are subject to limitations, or
conditions mutually agreed to, in writing, between Rural Development and
the employee. Payments may be applied only to the indebtedness
outstanding at the time Rural Development and the employee enter into
the service agreement, and may not begin before the employee enters on
duty with Rural Development. Student loan repayment benefits must be in
addition to basic pay and any other form of compensation otherwise
payable to the employee involved. Payments will be made by the National
Finance Center (NFC) directly to the holder of the loan by electronic
funds transfer.

\(i\) Tax withholdings must be deducted or applied at the time any
payment is made. Tax payments may not be spread out over time. Since
these tax implications could create a financial hardship for the
recipient of the repayment benefit, the following are ways to lessen the
impact of tax withholding on an employee's paycheck:

\(1\) Make smaller payments at periodic intervals through the fiscal
year or subsequent years, rather than issue payments under this part in
one lump sum;

\(2\) The employee can write a check to Rural Development to cover the
tax liability rather than have the tax liability withheld from the
employee's paycheck; or

\(3\) Deduct the amount of taxes to be withheld from the loan repayment
benefit before issuing payment to the holder of the loan.

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RD Instruction 2051-C

§ 2051.71 (Con.)

\(j\) Before authorizing loan repayments, Rural Development must verify
with the holder of the loan that the employee has an outstanding student
loan that qualifies for repayment. Rural Development must verify
remaining balances with the holders of the loan to ensure that loans are
not overpaid. Rural Development may repay more than one loan as long as
the loan repayments do not exceed the limit. The amount paid by the
agency is limited to \$6,000 per employee per calendar year or a total
career payment of \$40,000 per employee. Funding of loan repayments will
come from individual budgets. In determining the size of the loan
payments, management should take into consideration the employee's value
to Rural Development and how far in advance the mission area can commit
funds. If budgetary constraints are an issue, management officials have
the discretion to determine the repayment benefit amount given to an
employee each year.

\(k\) The employee will be responsible for making timely loan payments
on the portion of the loan(s) that continues to be his or her
responsibility. Payments do not exempt an employee from his or her

> responsibility and/or liability for any loan(s) the individual has
> taken out.
>
> \(l\) Rural Development is not authorizing the use of this program for
> students who have defaulted on their student loans and/or have not
> received a degree/diploma.
>
> \(m\) The National Office Human Resources office will perform an
> initial review and recommendation for National Office employees. The
> St. Louis Field Services Branch will perform an initial review and
> recommendation of repayment of student loans for St. Louis employees.
> State Offices will forward requests for repayment of student loans to
> the St. Louis Field Services Branch for an initial review and
> recommendation.

§ 2051.72 [Service agreements and repayments]{.underline}.

Before any loan repayments or service agreements may be made, an
employee must sign a service agreement, with Rural Development to
complete a specified period of employment and to reimburse Rural
Development for loan repayment benefits if the employee is separated
involuntarily on account of misconduct, or failure to maintain an
acceptable level of performance, or the employee leaves the agency
voluntarily before the specified period of employment. Please reference
attached Exhibit B, "Sample Service Agreement for a Receipt of Repayment
of Student Loan(s)," which gives you an example of how an agreement
should be written. The agreement may also specify any other employment
conditions such as, but not limited to, the employee's position and the
duties he or she is expected to perform, work schedule, or level of
performance.

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§ 2051.72 (Con.)

\(a\) The minimum period of employment to be established under a service
agreement must be 3 years, regardless of the amount of loan repayment
authorized. Service agreements can state that increases or renewals of
payments made under this part can be made without requiring the employee
to enter into a new service agreement or Rural Development can require
an additional period of service in the service agreement. All service
agreements must include a requirement for repayment, regardless of the
type of separation other than the separation described in\
§ 2051.73 of this instruction.

\(b\) There is no requirement to refund the loan repayment when the
employee fails to complete a period of employment established under a
service agreement because the employee is involuntarily separated for
reasons described in §2051.69 of this instruction.

\(c\) Any amount repaid, or recovered from any employee will be credited
to the appropriation account from which the amount involved was
originally paid. If possible, any amount so credited will be merged with
other sums in such account and will be available for the same purposes
and period, and subject to the same limitations (if any), as the sums
with which merged.

\(d\) When an employee is promoted or reassigned to a position with
greater promotion potential in another USDA agency, the service
agreement will be transferred with the employee and no repayment will be
required by Rural Development. However, if the employee then fails to
complete the remainder of the service agreement with the new USDA
agency, the pro rata payment for the unexpired service agreement must be
made to Rural Development.

\(e\) The service agreement will be placed on the left side of the
employee's Official Personnel Folder for the period of time specified in
the service agreement.

§ 2051.73 [Student loan payment waivers]{.underline}.

The DAOM has the authority to waive, in whole or part, a right of
recovery of an employee\'s debt under 5 U.S.C. 5514 if it is determined
that recovery would be against equity and good conscience, or against
the public interest.

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RD Instruction 2051-C

§ 2051.74 [Records]{.underline}.

State Offices must keep a record of each student loan repayment
determination and have the records available for review when requested.
These records may be destroyed 3 years after the loan has been repaid or
after the Office of Personnel Management has evaluated the program,
whichever is later.

§ 2051.75 [Reports]{.underline}.

\(a\) No later than October 31^st^ of each year, the Headquarters
Services Branch and the St. Louis Services Branch must report to the
Human Resources Programs Branch the following information for the
previous fiscal year:

\(1\) The number of employees given student loan repayments;

\(2\) The pay plan, series, grade, step, salary, title and location of
the employees who received student loan repayments;

\(3\) The total amount of the student loan paid to each employee;

\(4\) The total amount of student loan repayments made; and

\(5\) Please reference attached Exhibit C, "Reports and Records."

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Exhibit A

Page 1

**SAMPLE RECOMMENDATION AND APPROVAL**

**OF THE REPAYMENT OF STUDENT LOAN(S)**

  -------------------------- -------------------- ------------------------ ------------
  1\. Agency Name            2\. Agency Code      3\. Case No.             4\.
                                                                           Personnel
                                                                           Office
                                                                           Identifier

  5\. Name of Employee       6\. Social Security  7\. Duty Station Code    
                             No.                                           

  8\. Position Title         9\. Location (City,  10\. Pay                 
                             State)               Plan/series/grade/Step   

  11\. Salary                12\. Organization    13\. Effective Date      

  14\. Accounting Code       15\. Mail Check to                            
                             (if applicable)                               
  -------------------------- -------------------- ------------------------ ------------

**The following information [must]{.underline} be attached, for review
by the recommending and approving officials for a student loan
repayment:**

-   A written justification outlining the difficulty experienced or
    expected in filling the position if a student loan is not repaid,
    and

-   A written determination that unusually high or unique qualifications
    of the employee or a special need of the agency exists.

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-   In addition, the proposed amount of the loan repayment, along with
    the rationale for the amount proposed.

  --------------------------- ------------------------ -------------------
  16\. Recommended Amount \$                           

  Signature of Recommending   Title                    Date
  Official                                             

  17\. Approved Amount \$                              

  Signature of Approving      Title                    Date
  Official                                             
  --------------------------- ------------------------ -------------------

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RD Instruction 2051-C

Exhibit A

Page 2

**SAMPLE RECOMMENDATION AND APPROVAL**

**OF THE REPAYMENT OF STUDENT LOAN(S)**

  ------------------------------ ------------------------- --------------
  Comments/Changes:                                        

  Signature of Approving         Title                     Date
  Official                                                 

                                                           
  ------------------------------ ------------------------- --------------

RD Instruction 2051-C

Exhibit A

Page 3

**Privacy Act Statement**

Public Law 104-134 (April 26, 1996) requires that any person doing
business with the Federal Government furnish a social security number or
tax identification number. This is an amendment to title 31, section
7701. Furnishing the social security number, as well as other data, is
voluntary, but failure to do so may delay r prevent action on the
application. If your agency uses the information furnished on this form
for purposes other than those indicated above, they should provide you
with an additional statement reflecting the purpose.

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Exhibit B

Page 1

**SAMPLE SERVICE AGREEMENT FOR A RECEIPT**

**OF REPAYMENT OF STUDENT LOAN(S)**

In return for the repayment of my student loan(s) as described below, I
herby agree to remain an employee of the U.S. Department of Agriculture
(USDA) -- Rural Development for the period beginning
\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ following the effective date of the
student loan repayment, unless I am separated for reasons beyond my
control and which are acceptable to the above named agency. The amount
of the repayment of student loan I will be receiving under this
agreement is \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_.

I agree that if I do not remain in the agency and maintain an acceptable
level of performance for the above specified period I will repay to the
agency the total amount of student loan repayment benefits I have
received. I understand that this service agreement does not constitute a
right, promise, or entitlement for continued employment of
noncompetitive conversion to the competitive service. I understand that
under such circumstances these monies are recoverable from me as a debt
due the Untied States Government and the agency is not responsible for
making your loan payments and any late fees you are charged.

  ----------------------------------------------------- -----------------
  Signature                                             Date

  ----------------------------------------------------- -----------------

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Instruction 2051-C

Exhibit C

Page 1

**REPORTS AND RECORDS**

\(a\) No later than October 31^st^ of each year, the Headquarters
Services Branch, and the St. Louis Services Branch, must report the
information listed below to the Human Resources Programs Branch. In
turn, the Human Resources Programs Branch will, no later than November
15^th^ of each year, provide the Office of Human Resource Management
(OHRM) this information for the previous fiscal year:

\(1\) The number of employees given student loan
repayments\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_.

> \(2\) The pay plan, series, grade, step, salary and title of the
> employees who received student loan repayments (list below):
>
> \(3\) The total amount of the student loan paid to each employee (list
> name of each student and amount received below):
>
> \(4\) The total amount of student loan repayments made by the program
> offices
> \_[\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_]{.underline}.

(a) OHRM will request race, sex, national origin, and disability
    information from the National Finance Center data base. This
    information will be reviewed and evaluated to determine if there are
    any disparities or issues related to protected groups by grade,
    salary, title location, amount paid, or between Mission Areas or
    Staff Offices.

(b) Each Staff Office must keep a record of each student loan repayment
    determination and have the record available for review when
    requested. These records may be destroyed 3 years after the loan is
    repaid.

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