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Loan forgiveness can be an effective recruitment and retention tool. Depending on the program and the requirements, qualified teachers can have federal student loans forgiven or cancelled. A list of eligible schools can be found in the Teacher Cancellation Low Income (TCLI) Directory. This list is not exhaustive, but rather provides program structures for federal programs.

Public Service Forgiveness

The Public Service Loan Forgiveness (PSLF) Program forgives the remaining balance on your Direct Loans after you have made 120 qualifying monthly payments under a qualifying repayment plan while working full-time for a qualifying employer. To qualify for PSLF, you must:

• be employed by a U.S. federal, state, local, or tribal government or not-for-profit organization
• work full-time for that agency or organization
• have Direct Loans
• repay your loans under an income-driven repayment plan; and
• make 120 qualifying payments.

Certifying your employment annually or when you change employers, as you work toward PSLF, will save time and effort, when ready to apply for forgiveness.

Teacher Loan Forgiveness

Under the Teacher Loan Forgiveness Program, full time teachers who have taught five complete and consecutive academic years in a low-income school or educational service agency, and meet other qualifications, may be eligible for loan forgiveness. Eligibility requirements include:

• Must not have had an outstanding balance on Direct Loans or Federal Family Education Loan (FFEL) Program loans as of Oct. 1, 1998, or on the date that you obtained a Direct Loan or FFEL Program loan after Oct. 1, 1998;
• Must have been employed as a full-time, highly qualified teacher for five complete and consecutive academic years;
• Must have been employed at an elementary school, secondary school, or educational service agency that serves low-income students.

The loan(s) for which you are seeking forgiveness must have been made before the end of your five academic years of qualifying teaching service. The school or educational service agency of employment must be listed in the Teacher Cancellation Low Income Directory, which is published by the U.S. Department of Education each year. To find out if your school or educational service agency is classified as low-income, search the directory database for the years you have been employed as a teacher. If the TCLI Directory is not available before May 1 of any year, the previous year’s directory may be used for that year. To be an eligible school;

• School must be located in a Title I eligible school district;
• School must have an annual student population at more than 30.01% free/reduced price lunch and be listed on the federal TCLI Directory;
• If you do not see a school on the TCLI Directory, look to the NJ School Performance Reports to see if it meets the above 30.01% requirement.

General questions about school eligibility or schools currently listed in the TCLI Directory, can be referred to loans@doe.nj.gov. 

Perkins Loan Teacher Cancellation

Teachers may be eligible to have all, or a portion of their Perkins Loan cancelled if they have served full time in a public or nonprofit elementary or secondary school system as a:

• teacher in a school serving students from low-income families;
• special education teacher, including teachers of infants, toddlers, children, or youth with disabilities; or
• teacher in the fields of mathematics, science, foreign languages, or bilingual education, or in any other field of expertise determined by a state education agency to have a shortage of qualified teachers in that state.

Eligibility for teacher cancellation is based on the duties presented in an official position description, not on the position title. To receive a cancellation, you must be directly employed by the school system. If eligible for cancellation, up to 100% of the loan may be cancelled for teaching service, in the following increments:

• 15% cancelled per year for the first and second years of service;
• 20% cancelled for the third and fourth years;
• 30% cancelled for the fifth year.

Perkins V is a federal education program that invests in secondary and postsecondary career and technical education (CTE) programs in all 50 states and the territories. It is dedicated to increasing learner access to high-quality CTE programs of study with a focus on program improvement; alignment across grades 5-12, postsecondary and workforce; and economic development. Perkins V is critical to ensuring programs meet the everchanging needs of learners and employers.

Perkins V can fund dual enrollment/early college courses for high school students enrolled in an approved CTE program of study in education. Perkins can also support students in approved CTE programs obtaining credentials for teaching, such as the PRAXIS series. Any New Jersey school district, state agency, or approved charter school intending to offer a CTE program in Education may apply for Carl D. Perkins funds. Any Education CTE program or program of study must meet the requirements established by the NJDOE.

Title IV, Part A is a program intended to improve students’ academic achievement by increasing the capacity of states, local education agencies, schools, and local communities in three categories. According to Title IV ’s well-rounded education category, federal funding can be allotted for dual enrollment or concurrent enrollment programs for GYO programs designed for high school students. This funding stream should be used if the GYO does not wish to be or become a CTE approved program. Title IV’s funds can also be used to provide information and counseling on teaching as a profession to students; start a new afterschool future teacher club for high school students; and fund regional conferences for high school students and their families to introduce teaching as a potential profession.

When applying for federal funding, school districts must ensure that any proposed spending be reasonable and a necessary cost. Any funding requests must use data to clearly present a need for funds and use evidence-based activities.

School districts should also be aware of the supplement, not supplant rule. Some title funding discussed in this document are held to the supplement, not supplant rule which requires school districts to use all local and state funding they would use in the absence of federal funding. If a school district is currently funding an activity using local or state funding, then federal funds may not be used.

Some federal programs, under certain circumstances, require school districts to conduct a formal needs assessment. Even when not required, spending of federal funds is most effective when districts and schools seek out stakeholder input and use evidence-based strategies to address the specific needs of students. It is strongly recommended to consult with the specific federal funding program to ensure the proper use of funding.