House staffers will be eligible for up to $40,000 of student loan reimbursements under a program approved by the House Administration Committee this week.

Staffers are limited to $500 a month in government-funded student loan repayments, not to exceed $40,000 over the course of Congressional employment. A “Dear Colleague” letter is set to go out today from Chairman Bob Ney (R-Ohio) and ranking member John Larson (D-Conn.) explaining the plan in detail.

“I am very excited. I think it’s a very good program,” Ney said. “Jobs are becoming competitive in the District of Columbia, and I think it’s good for retention of staff.”

Money for the program was put into the fiscal 2003 legislative branch appropriations bill, but regulations had to be drawn by the House Administration Committee before it could be implemented.

The Senate began a similar program last year, and both were closely modeled on loan reimbursement programs used in the executive branch.

Participation in the repayment program is at the discretion of employing offices, but funds won’t be drawn out of Members’ Representational Allowances or committee budgets. Rather, a separate allocation will be available for any expenses incurred for the loan repayments.

Funds for the program will come out of a separate account administered by the Chief Administrative Officer. Each participating Member office will be allocated 2 percent of the average MRA (approximately $20,000) for student loan repayments; committee and support offices will be allowed 2 percent of their annual budgets for salaries and expenses to administer the program.

Those totals represent the maximum allowable funds that can be used by offices for student loan reimbursement each fiscal year. Because of its zero-sum setup, eligible employees might not be able to receive the maximum $500 a month if the money is obligated to other staffers in the office.

The CAO’s Office of Finance will keep track of how much funding an office has obligated for student loan reimbursement each year and would uniformly reduce the amount of employees’ monthly payments if the office had exceeded its annual limit.

Money for the loan reimbursement, like all other Congressional programs, has to be appropriated every year, and appropriators expressed enthusiasm for the plan at a hearing on the fiscal 2003 legislative branch appropriations bill last year.

The program was designed as a recruiting and retention tool, and employees could be required to reimburse the House if they leave before the end of their “repayment contracts.”

Each year a staffer participates in the program, he or she is essentially committing to work for the employing office that year.

Additionally, student loan payments under the program are considered taxable income.

Next week, the House Administration Committee, along with the CAO’s office and other House officials, will host up to six briefings to answer questions about the plan and determine the level of interest. Dates and times will be announced later this week.