Lifting the Burden: Law Student Debt as a Barrier to Public Service

Executive Summary9THE PROBLEM: EDUCATIONAL DEBT BARS NEW LAWYERS FROM PUBLICSERVICE CAREERSMany law school graduates face a disheartening dilemma. Despite their deepcommitment to ensure access to justice for all citizens, many law students find thatthe rising cost of a legal education forces them to forego any form of public service.They must borrow increasingly higher amounts. Most graduates of law school todayhave a cumulative debt from undergraduate and law school that exceeds $80,000.Assuming a standard ten-year repayment schedule, this means payments of morethan $1,000 per month.Most graduates interested in pursuing public service careers with government or legalservices organizations can expect to make a median entry-level public interest salary of$36,000 (for 2002 graduates) and do not have the resources both to repay educationalloans and support basic living expenses. A recent study found that law school debtprevented 66% of student respondents from considering a public interest or governmentjob. This difficult economic environment for new law graduates in turn limits thepotential amount of legal services available to our citizens. The legal profession cannothonor its commitment to the principle of access to justice if significant numbers of lawgraduates are precluded from pursuing or remaining in public service jobs.Executive SummaryTHE ABA’S RESPONSEIn 2001, recognizing the significant impact of this problem upon the legalprofession and society, then-American Bar Association President Robert E. Hirshonmade the issue a priority of his presidential term. At his request, the ABA Board ofGovernors created the Commission on Loan Repayment and Forgiveness(“Commission”) for a two-year term. ABA leadership charged the Commission with(1) examining the law student debt burden issue and its impact on law graduates’ability to serve their communities by accepting and remaining in public service legalemployment and (2) making recommendations to the American Bar Association andthe legal profession about strategies to address this problem.During the past two years, the Commission has studied this problem and receivedtestimony from law students, graduates, public service employers, academics, lawdeans and others with an interest in the debt burden issue. Recognizing the need formulti-faceted solutions, the Commission developed three work groups - Federal, LawSchool and State - to identify some approaches that would alleviate the problem. Aspart of its work, the Commission also developed several resources to provideongoing assistance to the many stakeholders in this issue.SOLUTIONS THAT WORK: LOAN REPAYMENT ASSISTANCE PROGRAMSState governments, law schools and other entities have developed a number ofsolutions for relieving the debt burden of some law graduates, including loanrepayment assistance programs, public service post-graduate fellowships and publicservice scholarships. A loan repayment assistance program (“LRAP”) is a key tool,which provides financial aid to law school graduates, typically those working in thepublic interest or government sector. In most cases, this aid is given to graduates inthe form of a new and forgivable loan to help them repay their annual educationaldebt. Upon completion of the required service obligation, the LRAP administratorforgives or cancels the new loan to program participants. Most LRAPs contain limitson the amount of income a recipient can earn while participating in such a program.There are various types of LRAPs, administered by law schools, state bar foundationsand federal and state governments, providing debt relief to a limited number of lawgraduates. However, the number and scope of existing LRAPs are limited.