SC law bans student loan repayers from government jobs for decades | tidings


The recent dismissal of a Charleston County sheriff’s official has shed light on a vague law that has barred student debtors from holding government jobs in South Carolina for more than four decades.

Some public officials believe the law should be reviewed by lawmakers, with at least one law professor raising concerns that it could disproportionately hurt minority job candidates.

On April 1, Charleston County Sheriff Kristin Graziano fired Deputy Chief of Staff Joyce Smith for failing to correct some federal student loans that had been outstanding since at least January 2021, when the former North Charleston police major was fired. hired for the first time.

Deputy Chief Joyce Smith was fired from the Charleston County Sheriff’s Office on April 1 on charges that she had defaulted on student loans. File / Charleston County Sheriff’s Office / Offered

Graziano said in a concluding letter that she gave Smith time to address the problem, but she failed to do so. By January, loans had fallen to “collection status”.

The senior county police officer told Smith that she was responsible for enforcing the law, which included Statute SC 59-111-50.

But the sheriff’s decision raised eyebrows among local and state officials, many of whom were unaware of the existence of the law.

South Carolina law prohibits anyone who has intentionally failed a federal student loan from government employment unless they correct the loan through their lender.

The law was passed in 1980 amid national concerns about student loan debt and the rising rate of default on federally backed student loans. High inflation rates and a stagnant economy pushed the non-payment rate to double digits by the late 1970s. Some officials also worried that borrowing students would choose to repay their debts through bankruptcy instead of paying them off. .

A rumor of responsibility spread throughout the country. Joining the choir was Rep. Bobby Kinard, a Democrat from North Charleston, who introduced a bill that would become the law on student loan default.

Kinard, who later became mayor of North Charleston, told the Associated Press at the time that anyone who deliberately failed on a student loan was a thief.

“If a person borrows money and gives the word, he will return it, but he does not, it is the same as stealing,” said the lawyer.

Charleston county sheriff's sacking officer fired for unpaid student loans

Kinard said he learned of the problem after people sought legal help to file for bankruptcy to avoid paying off student loan debt.

“They are not bankrupt,” he said. “Most just do not want to repay the loan.”

Rep. Marshall Cain later amended the bill to allow borrowers to hold state-owned jobs if they correct their loans through their provider. Republican Aiken told the AP he was concerned the law might prevent a person from finding a job to pay off their debt.

The bill was passed and signed into law by Gov. Dick Riley in April 1980.

With it came a change in the state job application that remains today: A person must prove that he or she is not in arrears on his or her federal student loans when applying for a government job. This is true whether they want to control the roads or sweep them away, teach at a public university or clean the floors.

Few states seemed to follow Palmetto State’s example of banning employment.

Josh Cunningham, a project manager for the National Conference of State Legislatures, researched the number of states that have similar laws on books at the request of The Post and Courier.

Cunningham said he was able to find only one state, Illinois, which also banned state employment for bankrupt borrowers who did not repay their loans.

In Florida, state employees risk keeping 10 percent of their paychecks if they find themselves in similar trouble, but the law explicitly prohibits firing someone for their debt, according to Cunningham.

If South Carolina lawmakers hoped the new law would help solve the country’s debt problems, they were sorely mistaken. The student debt crisis has only worsened in the intervening decades.

As of January, Americans owed $ 1.61 trillion in federal student loan debt, according to the Education Data Initiative. Approximately 12 percent of student loans are currently outstanding, which means that one payment has expired for more than 270 days, despite an ongoing moratorium on student loan repayments in response to the COVID-19 pandemic.

The educational landscape has changed in more than 40 years since South Carolina passed the law. The costs of college and the debt that students receive to attend institutions have increased significantly, although four-year degrees have become increasingly important in finding a well-paying job.

In the 1980-81 school year, students receiving a four-year degree from a public university spent an average of about $ 8,300 on today’s dollars, including tuition, fees, and accommodation, according to the College Board. Nowadays, a student will spend on average almost three times that, $ 22,700, for the same degree.

Bankruptcy laws have also changed since 1980 to stop students from paying off their debts.

South Carolina law allows state employees to keep their jobs if they solve the debt problem.

If the employee can not pay the full amount at once, he has two options to escape failure: rehabilitation or consolidation. Both plans require the student to make a certain number of affordable monthly payments, as determined by the loan provider, before the debt is no longer considered bankrupt.

It is unclear why Smith, who earned $ 126,000 a year in the Sheriff’s Office, did not repay her loans. The former MP did not respond to requests for comment.

But to catch debt payments, a person needs a job in the first place.

It is difficult to know how many people have been denied state jobs, or simply never applied, because of their failed student debts.

Some lawyers and employment professors told The Post and Courier that they were well aware that the law existed before Smith’s dismissal became headlines.

Colombia’s lawyer, Lewis Cromer, has practiced labor law since 1959. He said he knew about the law, but he rarely went to court.

“I heard about it during my practice, but I have no idea when it came into force,” Cromer said.

Dennis Nolan began teaching labor law at the University of South Carolina in 1974, while also directing an arbitration and mediation practice on his part.

“I usually keep a very close eye on labor law developments in the SC, but this one saved me,” Nolan said in an email.

Joe Seiner, another law professor at USC, said he was also unfamiliar with the law, but he was concerned about the different impact it could have on minority employment in government.

African-American college graduates average $ 25,000 more in student loans than white students, while also experiencing higher default rates – 18 percent compared to 9 percent. At 13 percent, Hispanic students are also more likely to not pay than whites.

Seiner said that if the law discriminated against certain groups more than others, it could conflict with federal employment protection.

Public officials also expressed concerns about the law.

Ninth District Public Defender Ashley Pennington said he should never have rejected a candidate or fired one of his attorneys for student loans, but he still thought the law was a bad policy.

Poor planning or just bad luck can put a person behind in their debts, Pennington said.

“It definitely serves society for those with student debt who want to work to find work,” the ombudsman said.

Rep. Jerry Govan, who is running for state education overseer, co-sponsored the Student Credit Rights Act last year to strengthen protection for borrowers in South Carolina, but he did not address the state employment practice.

The Orangeburg Democrat said people had to pay their dues, but the law essentially locked people in a debtors prison.

“If you can not find a job, how will you repay the debt?” he said. “It just doesn’t make sense.”

Govan said he would contact State Human Resources to find out how many people have been turned down for state jobs due to non-payment of student loan.

Graziano also expressed reservations about the law.

In an April 12 statement, the sheriff said he would like to see the law changed to help employees who are facing financial hardship who are making reasonable efforts to address the debt problem.

However, she noted that debt is a bigger issue for law enforcement officers, who may be more vulnerable to influence or bribery because of money problems.

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