Loan helps Concordia grad achieve goals

Ron Litzau was a year into college when he realized he wanted to be a teacher.

It was Litzau's hope to return to his roots in the Park Rapids, Minn., area at the culmination of his four years at Concordia College.

So when a physical education teaching position opened up at the Pine Point School District on the White Earth Reservation where Litzau is a member, he didn't think twice.

Litzau was doubly elated to learn that by teaching in this particular school, he could forgive his entire $10,000 Federal Perkins Loan.

The Pine Point school, like many other low-income schools, has been identified by the government as suffering from a worker shortage.

Students who receive the Perkins Loan -- as Litzau did -- and work in the critical specified occupation areas have the opportunity to cancel their loans after completing five years on the job -- as Litzau did.

"Everything just fell into place for me," he said. "I've found that it's a great program."

The Federal Perkins Loan, first established in 1958, is a low-interest loan for students who express exceptional need. The college or university acts as the lender, but the loan is made with government funds with a share contributed by the school.

It's comparable to the Federal Stafford Loan, expect the Perkins Loan has a longer deferment period -- up to nine months after graduation as opposed to six -- and can be canceled 100 percent.

Jeanne Dotson, director of Student Loan and Account Repayment at Concordia, said the loan program is essential for helping students get a college education. But as each year passes, government support for the loan program diminishes, she said.

"Every year we have to fight for federal capital contribution," Dotson said. "We're always at risk of losing this program. We want to make it so not only the wealthy students can get a good education."

Dotson, who also is president of the Coalition of Higher Education Assistance Organization, has been fighting for years to increase funding for the program. In April, she testified before the Subcommittee on Labor, Health and Human Services, Education and Related Agencies in Washington, D.C., asking for increases to the federal contribution.

She also was seeking increased funding for the Federal Perkins Loan cancellation fund. This is a revolving loan program with students paying back their loan directly to the school. So when a student meets the criteria and is able to cancel his or her loan, the school's fund needs to be refreshed.

"The government reimburses schools for those cancellations," Dotson said. "But they're not allocating enough."

Dotson requested $20 million more in funding from the committee on behalf of participating schools around the country.

At Concordia last year, 763 Perkins Loans were awarded, totaling more than $1 million.

Opponents of increased funding for the Perkins Loan say the program is so small that efforts and money could be better spent elsewhere.

But Dotson contends that the Perkins Loan is unique in that it targets the neediest students. It also can help address a workforce shortage in certain occupations, such as teaching in a low-income school district.

Litzau canceled his loan this year, so he speaks with first-hand knowledge when he says the Perkins Loan helped him achieve his goals.

"It was a win-win situation," he said. "I think of it as a reward for doing the right thing."

Readers can reach Forum reporter Mary Jo Almquist at (701) 241-5531