COLLEGE POLICIES AND PROCEDURES
MEMORANDUM NO. 206

FORGIVABLE LOAN POLICY


Revised: June 22, 2010

Original Number: 19
Original Date of Issue: February 13, 1969
Reissued: September 27, 2000
Reissued: May 28, 2002

Forgivable loans are available for study at accredited institutions for courses offered over a regular college semester. Funds for short-term study, CEU workshops, conferences or seminars are available to full-time faculty through the collective bargaining contract travel fund. For full-time faculty, classified/confidential staff and administrative staff funds are available through departments for staff development. Additionally, the Community College of Philadelphia Foundation makes grants, which may cover conference attendance. The appropriate Vice President must approve the request for a forgivable loan prior to the start of the program for which the loan is requested. Failure to obtain such prior approval may lead to disapproval of the loan request.


Full-Time Faculty and Administrators

For employees taking academic work at other institutions (including mini-courses with the approval of the President or his/her designee), the following shall apply:

Part-time Academic Study

An Employee who pursues academic study in an accredited institution on a part-time basis while working at the College may borrow from the Board annually a sum not to exceed fifty (50%) percent of the tuition paid to that institution during the course of the year, providing that the loan balance on the revolving account shall not exceed $10,000.
Such Employee who continues in the service of the College after benefiting from this loan program will not be charged interest, and the loan will be forgiven at the rate of fifty (50%) percent at the end of the year following that in which the loan was granted, and the remaining fifty (50%) percent at the end of the third year. The sum borrowed during any succeeding year will be similarly forgiven after the second and third following years. Loans are treated as taxable income when forgiven.

Full-time Graduate Study

An Employee who has been granted a full-time leave of absence to enroll as a graduate student in an accredited educational institution will be eligible to borrow from the Board up to $10,000 per year to a total limit of $25,000 beginning with the 2002-2003 academic year.   

Such Employee, returning to the College after the leave for graduate studies, will not be required to pay interest, and the loan will be forgiven at the following rate: twenty-five (25%) percent at the end of the first academic year after the leave, and twenty-five (25%) percent at the end of each of the three (3) following academic years. Loans are treated as taxable income when forgiven.

Classified and Confidential

For each regular full-time employee, who has been employed by the College for at least one (1) year and is enrolled in a course of study not available at the College, the College shall provide forgivable loans for academic work at institutions other than the College provided that:


a) The studies to be undertaken are, in the opinion of the President or his/her designee, pertinent to any work performed at the College. However, any course work that would lead to an Associate's degree will be taken at the College provided that the College offers the course.

b) The studies are to be undertaken, whenever possible, outside of the regular working hours and the reimbursement shall be limited to three (3) courses per semester.

c) The amount of forgivable loans shall be for a maximum of 50% of the total cost of tuition up to a maximum of $10,000 beginning September 1, 2001.

d) Such Employee, returning to the College after the leave, will not be required to pay interest, and the loan will be forgiven at the following rate: twenty-five (25%) percent at the end of the first academic year after the leave, and twenty-five (25%) percent at the end of each of the three (3) following academic years.  Loans are treated as taxable income when forgiven.

Classified and confidential employees shall be entitled to forgivable loans for full-time graduate study on the same terms and conditions as full-time faculty.

Repayment for All Forgivable Loans Not Forgiven


Repayment of loans not forgiven shall be on the following basis: In successive monthly installments of not less than one forty-eighth (1/48) of the amount due and owing plus interest at the rate of twelve percent (12%) per annum of the unpaid balance the first installment of which shall be paid on the first day of the month following the termination of employment. Interest on this loan at the rate specified above should begin to accrue upon termination of employment; provided, however, that there shall be no duty to repay during periods of long-term disability and/or layoff. Upon return to employment the regular schedule for forgiving loans shall recommence. The interest rate on all loans not forgiven shall continue at twelve (12%) percent per annum.

Attachments:
(a) Application for Approval of Program of Forgivable Loan (pdf)
(b) New Forgivable Loan Application Form (pdf)



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