Loan Repayment Assistance Program (LRAP) FAQ
Below are some of the common questions and answers asked by members regarding the LRAP program. Please contact us if you do not find an answer to your question here.
Please note: Most of these answers will refer to the LRAP Policies and Guidelines for more complete answers. It is suggested that you download a copy and print it off for ease in reference.
2. Are college loans considered as part of the educational debt? Loans from parents, other relatives, or friends? What about credit card loans? All graduate and undergraduate educational debt in the applicant’s name is eligible. See LRAP Policies and Guidelines Section 2(E). Family and personal loans may be considered if they are for an educational purpose and supported by documentation. Credit card loans are not eligible.
4. My student debt is over $35,000, but my annual amount due is $3,000, less than the $5,000 maximum annual assistance provided by the LRAP. Am I eligible? Yes. Beginning in 2011, LRAP loans are available for amounts up to $5,000. If your annual payments total is less than $5,000, you should request a smaller loan on your application. If you are selected, your loan amount will remain constant for the three years you participate in the program.
5. I currently receive another LRAP loan (from my employer, my law school or another program). May I apply for an OSB LRAP loan? Yes, but keep in mind that you can only apply for OSB LRAP loans to the extent that you are repaying student loans. If you receive a different LRAP loan for $2,000, and are paying $4,000 per year in student loan debt, you may apply for $2,000 from the OSB LRAP. If you receive $3,500 per year from a different LRAP loan and are only paying $3,500 per year in student debt, you would not qualify for an OSB LRAP loan.
7. Do you consider household income, including spouse or domestic partners? In determining eligibility, only the applicant’s income will be considered. However, the Advisory Committee may consider an applicant’s extraordinary household expenses. See LRAP Policies and Guidelines Section 4(B).
8. What qualifies as public interest employment? Qualifying employment includes employment as a practicing attorney with civil legal aid organizations or other private nonprofit organizations providing direct legal representation of low-income individuals, or employment as public defenders or deputy district attorneys. See LRAP Policies and Guidelines Section 2(B).
9. I am a sole practitioner, but most of my work is public defense. Am I eligible for the LRAP? No. Attorneys appointed on a case-by-case basis are not eligible. See LRAP Policies and Guidelines Section 2(B).
10. I work for a private firm that has a contract with Oregon Public Defense Services Commission. Most of my caseload consists of these cases. Does this employment qualify for the LRAP? Yes. If 95% or more of your caseload is public defense work, your employment qualifies for the LRAP.
11. Do I need to be in a qualified position at the time of application? Applicants must already be engaged in qualifying employment by the time of the application deadline. See LRAP Policies and Guidelines Section 4(A).
12. How many years after graduating from law school am I eligible as long as I meet program qualifications? There is no limit to the years beyond law school graduation for purposes of eligibility, so long as the applicant meets program qualifications. The OSB LRAP does not limit applicants to recent law school graduates or recent bar admittees. The Advisory Committee encourages applications by those who have shown a demonstrated commitment to public service work. See LRAP Policies and Guidelines Section 2(C).
13. Do I need to be a member of the Oregon State Bar to apply? To participate? Yes. Program applicants must be licensed to practice in Oregon. Employment must be within the state of Oregon. See LRAP Policies and Guidelines Section 2(B), (C).
14. Do you look at salary only or other income, too? If the Advisory Committee needs to select among applicants meeting the salary, debt, and employment eligibility criteria, it may take into account earnings, income-producing assets, and other income as shown on the applicant’s most recent tax return. See LRAP Policies and Guidelines Section 4(B)(ii).
15. Other than income, what criteria will the Advisory Committee consider? If the Advisory Committee needs to select among applicants meeting the salary, debt, and employment eligibility criteria, it may take into account several factors—including demonstrated commitment to public service work, financial need, educational debt to income ratio, extraordinary personal expenses (e.g., medical, child care, and child support expenses), type and location of work, and assistance from other loan repayment assistance or similar programs. See LRAP Policies and Guidelines Section 4(B).
16. How many applicants will be selected for assistance? The number of applicants who will be selected to participate in the LRAP depends on available program funding and the size of loans requested. In 2014, a total of $30,000 per year will be available for new participants. If loans of $5,000 are requested by the six leading applicants, only six will be chosen. The Advisory Committee anticipates that six to twelve participants will be selected in 2014.
17. How much assistance is provided? LRAP loans will be a maximum of $5,000 per year per program participant for a maximum of three consecutive years. The amount of any LRAP loan will be based on a participant’s successful application, and upon that participant’s requested loan amount and his or her annual loan payment at the time of application. Any particular applicant’s loan will remain the same for all three years in the program, regardless of changes in payments by the participant. The Advisory Committee reserves discretion to adjust the amount of the LRAP loan and/or length of participation based on changes in the availability of program funding. The Advisory Committee also reserves the right to determine the loan amount based on the requests received in any given year. See LRAP Policies and Guidelines Section 3(A). Payment will consist of semiannual disbursements.
18. Are LRAP loans a taxable benefit? Each program participant is responsible for any tax liability the participant may incur, and neither the Advisory Committee nor the OSB can give any program participant legal advice as to whether a forgiven LRAP loan must be treated as taxable income. Program participants are advised to consult a tax advisor about the potential income tax implications of LRAP loans. The intent of the program is for LRAP loans which are forgiven to be exempt from income tax liability. See LRAP Policies and Guidelines Section 3(A)(iii).
Loss of Eligibility Questions
19. What happens if I default on my student loan(s) while an LRAP recipient? Program participants who are in default on their student loans become ineligible to receive further LRAP loans. Such individuals may seek to have LRAP loans forgiven in accordance with the loan forgiveness schedule if they remain in qualifying employment and submit an employer verification form pursuant to LRAP Policies and Guidelines. See LRAP Policies and Guidelines Sections 3(B)(ii), 4(C)(v).
20. What happens if I leave qualifying employment or otherwise no longer meet the program qualifications? Program participants who become ineligible for program participation because they leave qualifying employment must repay LRAP loans, including interest, for any amounts not previously forgiven. The program forgives one year of loans annually if the Participant has been in qualifying employment the prior year, and has paid at least the amount of his or her LRAP loan on student loans. Participants must notify the program within 30 days of leaving qualifying employment. Exceptions to the repayment requirement are available for program participants who have accepted public interest employment in another state, are on periods of leave approved by their qualified employers, and for other exceptional circumstances.
21. What if my salary was under $55,000 at the time of application, but goes above that within the three-year period? Program participants whose salary exceeds $55,000 after the initial application due to annual salary raises with the same employer will remain eligible for program participation. If a program participant’s financial condition changes for other reasons, the Advisory Committee may determine that the program participant shall not receive further loans. See LRAP Policies and Guidelines Section 4(C)(iv).
LRAP Development and Administration Questions
22. How were the LRAP Policies and Guidelines developed? In 2005, the Oregon State Bar Board of Governors (BOG), through its Access to Justice Committee (ATJ Committee), assessed the impact of educational debt on the ability of law graduates to enter and remain in public service jobs. As a result of this assessment, the BOG approved the development of the Oregon State Bar Loan Repayment Assistant Program (LRAP) to assist Oregon lawyers in paying their educational debt while working in public interest jobs in Oregon. The BOG also approved partial funding for the LRAP by dedicating $5 of each member’s dues to the program, beginning in 2006.
In 2006, the ATJ Committee developed a program structure for the LRAP including oversight, administration, and selection criteria. Along the way, the ATJ Committee received input from other states with LRAP programs, law schools in Oregon, the American Bar Association (ABA), public defenders, district attorneys, civil legal aid organizations, and other Oregon stakeholders. The BOG approved the LRAP Policies and Guidelines in November 2006. Application forms were developed in early 2007 following a review of forms used in other states, and in consultation with the ABA. Grievance Procedures and Grievance Forms were created in 2008. The Policies and Guidelines are reviewed annually by the LRAP Advisory Committee and any changes needed are thereafter recommended to the BOG. Changes to the application materials are made by OSB staff, as needed, to reflect changes to the Policies and Guidelines.
23. Deputy district attorneys generally have higher salaries than legal aid lawyers and public defenders. Why were they included in qualified employment? The Board of Governors concluded that deputy district attorneys meet the criteria of the LRAP mission to attract and retain public service lawyers by helping them pay their educational debt. Only deputy district attorneys who meet the $55,000 salary cap are eligible for program participation.
24. Will there be any amendments to the LRAP Policies and Guidelines? If so, when and by what process will amendments by adopted? The LRAP Advisory Committee has authority to amend and set policy guidelines as needed for the program. The Advisory Committee will consider changes to the LRAP Policies and Guidelines at the end of each calendar year. If you would like to recommend changes to the LRAP Policies and Guidelines, contact the LRAP Administrator at email@example.com or (503) 431-6355.