I hear an awful lot about student loan debt from my students. I can commiserate as I have a healthy chunk myself from my many years as a student seeking one degree or another. As such, I am not shocked by the articles in The Forum the last couple of days about how crushing loan debt can be to graduates. I get it.
Education is not free and it is not even cheap. But cost is relative from one place to the next. The cost of education in North Dakota at state institutions is reasonable when compared to other institutions across the United States. But still, graduates can emerge with a healthy student loan debt that is daunting to pay off.
Over the years there have been many discussions about how student loan debt relief can be tied to retaining graduates in the state. Most of the ideas I heard about didn’t go far enough and were only focused on newer graduates, not older folks like me who were already clearly in the state to stay (sorry to shock anyone who was hoping that my 16 year stint was all I was doing – I am in for another 30 years). After reading the recent articles I started thinking about that huge surplus the state has and the opportunity it could provide to create a really smart retention strategy that would ease the burden on taxpaying resident graduates with student loans, open the door to education for more North Dakota citizens, and create a more diversified and sustainable state that would endure beyond the oil boom years.
Every once in a rare while I have these moments of brilliance. Of course, they are typically surrounded on either side by moments of borderline lunacy, so folks may only half listen when the brilliance emerges. But stick with me folks, as my light bulb is at 150 watts today.
I will detail the main focus areas of my idea below.
The North Dakota Investment Act
1) A North Dakota tax credit for 10% of student loan payments paid annually by the borrower for those with filing incomes up to $75,000. For those making more than $75,000 the percentage can be dropped incrementally. Everyone, and that means even those making $250,000+ a year, should be able to receive some percentage of credit. This is important as we want to retain a varied range of folks who will be in many different earning categories. This credit should be refundable if there is no tax to reduce. (Rationale: Aids in retention and maintains an employee base that can meet the needs of a diversified business base).
2) A four year state specific tuition credit for all North Dakota students who attended high school in North Dakota for at least two years continuously immediately prior to seeking attendance at a state college or university (hence, they must have completed at least their last two years in North Dakota – however, this does not mean they have to enter college immediately after high school graduation). This deduction is phased out after four years of use or at the age of 30, whichever comes first. (Rationale: Encourage North Dakota students to seek higher education in the state – evidences a general commitment to the value of higher education, keeps tuition dollars in the state, adds to community economic base – more students, more expenditures, and incentives best and brightest to stay close to home for college.)
3) An additional tax credit for those folks who have established residency (lived in the state for at least one year) and who are working in one of the “critical focus” areas designated by the state (these areas should have at least five year designation window which is subject to renewal by the legislature after expiration). Some initial suggestions for “critical focus” areas – energy development and management, special circumstances urban planning (such as the planning so desperately needed in the oil patch area), public safety positions (and volunteer fire and ambulance members should qualify for this as well if they meet a threshold for hours – perhaps 500+ hours a year), and K-12 educators.
This credit should also be refundable if there is no tax to reduce. (Rationale: This will allow the state to be more competitive in both retaining and seeking the best people to address some of the state’s most critical challenges. Position listings would indicate that the tax credit applies to the position, which would allow potential employees to factor it in to their evaluation of the position’s pay and benefit package. )
So tell me, what do you think of my 150 watts? Too much, not as bright as you thought it would be, or just right? If you think it is “just right” please share it with the Governor and members of the North Dakota Legislature – it would be nice to be able to tell the college graduates in May that North Dakota is the place to stay. If you are disappointed because it was not as bright as you thought it would be, never fear – you only have 30 more years of me and my bright ideas in this state. 😉
Day one thousand three hundred and fifty-seven of the new forty – obla di obla da