It’s not unheard of for a corporation, non-profit organization or even the federal government to entice prospective employees with the promise to repay their student loans in exchange for a certain number of years of work. The city of Niagara Falls appears to be taking that idea and making it its own; offering to repay a portion of recent graduates’ student loans in exchange for living in the city for two years.
Fusion reports that in an attempt to counter Niagara Falls’ recent population losses, city officials began a program that offers to pay off $7,000 of recent grads’ student loans over two years if the millennial agrees to live in the city.
City officials say the program came about as a way to attract new residents to the city which is losing roughly 10% of its population every 10 years.
With a current population of around 50,000 residents, the once-popular tourist destination is in danger of losing its governmental powers by being re-designated as a town rather than a city and losing federal funding if its population continues to shrink.
Seth Piccirillo, development director for the city, tells Fusion that the program, which currently has five participants, offers a small solution to Niagara Falls’ issue and recent graduates’ struggles to repay their student loans.
“I think for something that was just an idea on paper just a few short years ago, it’s working and it’s accomplishing the type of personality change for our city that we’re hoping for,” he says.
While the program might be attracting young people who wouldn’t have considered calling the area home before, its ability to keep them as long-term residents isn’t foolproof.
Bobbie, a 25-year-old with about $40,000 in student debt, says she would have never thought about moving to Niagara Falls had it not been for the program, and while she’s enjoying her new city, she’s uncertain if the meager job market will allow her to stay beyond the required two years.
“I absolutely want to,” she says. “It’s just a matter of finding a job in the area that’ll let me stay.”
While the program may provide a slight reprieve from burdensome student loan debt, participants report having a difficult time making ends meet thanks in part to a lack of local job opportunities. Bobbie tells Fusion that she currently works at a coffee shop an hour outside of Niagara Falls.
Kenneth, a participant with about $60,000 in loans, says he appreciates the program, but doesn’t see much opportunity in being a long-term resident of the city.
“I don’t see a lot of job prospects for me here and that’s something I find very frustrating,” he says.
Although Piccirillo is happy with the program’s results so far, he’s uncertain how long the city will continue to fund the program. Instead, he hopes to partner with private foundations to continue attracting younger residents.
According to Fusion, Niagara Falls isn’t the only community looking to attract students by dangling free money in their faces. Nearly 70 counties in mostly rural Kansas offer $15,000 in student loan repayments over five years if they move to “opportunity zones.”
Officials with Kansas’ Department of Commerce say that about 90% of the 1,500 applications received for the program have been approved so far.
It’s too early to tell if these types of repayment programs will be the new norm for struggling cities, but some higher-education experts believe there is potential for such plans to take off.
Zakiya Smith, director of strategy at the higher education-focused Lumina Foundation and a former White House education advisor, tells Fusion that such plans may make sense for cities from an economic development perspective, but they might actually be better suited for corporations.
For example, she says automakers in Detroit and oil companies in North Dakota could see a spike in their number of employees if such programs are created.
Niagara Falls will repay your student loans – for a price [Fusion]
by Ashlee Kieler via Consumerist
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