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New Maine bill could bring more relief to debt-ridden students

Maine’s workforce is aging. As the state with the oldest median age in the country, it is easy to see the connection between a higher rate of older citizens and a higher rate of aging workers. While it may be an easy problem to recognize, it is not an easy one to solve. Maine legislators have established previous programs to benefit Maine graduates, but their most recently proposed bill, currently up for approval in the session, could help incentivize young Mainers to stay and work in Maine and should be passed in order to boost Maine’s economy and strengthen our economic future.

The Maine Department of Labor cites that there are 100,000 fewer Maine citizens under the age of 20 than those that are age 40 to 60, and in 2016, there were just over 1,000 more deaths than births in the state. There is no denying that Maine’s population is aging, and this is mainly due to the fact that young citizens are leaving the state and raising families elsewhere.

This could be detrimental to Maine’s workforce. A Maine Policy Review, written by two University of Maine and one Department of Labor employees, highlights the way an aging workforce will impact Maine’s economy. As of 2014, there were 370,000 baby boomers — the generation who saw the largest increase in labor force participation — still working. On the other hand, the population in Maine under the age of 19 that would potentially replace those baby boomers when they retire was only 259,000. This left a 111,000 gap that will only get worse, considering that many college graduates will leave the state and work elsewhere. Maine cannot afford to keep losing its youth population without facing significant labor shortages in the coming years.

The bill crafted to tackle this issue, titled LD 149, or An Act to Authorize a General Fund Bond Issue to Provide Student Debt Forgiveness To Support Workforce Attraction and Retention, was co-filed by Maine Sen. Majority Leader Nathan Libby and other senators and representatives. The bill proposes a $250 million bond that would instate a loan-forgiveness program for Maine graduates who agree to live and work in Maine for at least five years after graduation.

Since Maine students have faced a drastically increased amount of debt acquired pursuing higher education, offering debt forgiveness is a considerable incentive to keep students in Maine. A study by the credit reporting agency Experian states that in the last ten years, the amount of loans Maine college students have obtained has doubled. Maine Public Radio reports that on average, a 2017 graduate owes more than $31,000 in loans, and all together Mainers owe $6 billion.

Currently, Maine has a tax credit program, titled Educational Opportunity Tax Credit, that incentivizes graduates to work in Maine. This program offers tax credits through refunds or tax credit opportunities to students who have graduated from Maine college or universities in or after 2015. However, in order to be eligible to claim the credit on your taxes, the degree that you received has to correspond with a provided list on the Department of Administrative and Financial Services Maine Revenue website, which prioritizes STEM majors.

In this program, if you graduated after 2015 with a STEM degree, you are eligible for a refundable tax credit. This means that the state of Maine will offset the amount of money you owe in state taxes with the amount you paid in student loans and will even refund you any surplus. For example, if you are a STEM graduate who paid $2000 in student loans but only owed the state of Maine $1800 in taxes, Maine would refund you the $200 difference.

If you graduated with a degree outside of a STEM field, you are only eligible for non-refundable tax credits. Instead of receiving any surplus checks, the amount in which you paid in loans would be applied and deducted from the amount of state taxes you owe. This example would mean that if you paid $1800 in student loans, but owed the state of Maine $2000 in taxes, you would only need to pay the state $200.

While the tax credit program currently in place helps Maine students who decide to live and work in Maine, it prioritizes only certain Maine students and is not enough to keep young workers in Maine. The new bill introducing the $250 million bond will help students across all majors, and increase and diversify the skills that workers in Maine possess if they decide to stay in Maine.

The tax credit program is better than having no program in place to help Maine students. However, if LD 149 was to pass, eligible Mainers could see their student debt dwindle significantly and even vanish in roughly six and a half years, according to the Maine Senate website.

Initiating programs to benefit students and creating an incentive to stay in Maine will benefit Maine’s economy and boost our workforce. While this bill may only be one part of the student debt puzzle, it’s one piece closer to creating a state that prioritizes the educational, financial and work related needs of its citizens. The bill is currently going through editing among various state committees, and will then head to the House of Representatives and Senate Chambers for a vote. In the meantime, call your representatives and urge them to support the act that puts Maine students first.


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