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Board adopts Section 127 plan so state student-loan reimbursements reach eligible Portage staff
Summary
The board approved establishing an IRS Section 127 Educational Assistance Plan to accept and distribute a state program that will reimburse eligible educators' student loan payments (Brad said 62 staff qualified and payments will be processed through school-aid receipts).
The Portage Public Schools Board of Education approved a resolution to adopt a Section 127 Educational Assistance Plan so the district can receive and disburse a state program that reimburses eligible educators' student loan payments.
Brad, who described the logistics, said the state created a reimbursement program that may cover up to $200 in any one month for eligible educators. He told the board the district applied and was accepted, and that 62 staff members met the eligibility requirements (including qualifying student-loan program type and proof of payments). Brad said the school-aid fund will begin including the state payments and the district must then pay eligible staff; counsel recommended using a Section 127 plan to make the reimbursements tax-free to employees and the district.
Brad cautioned that implementing the plan requires additional administrative steps and may affect other tuition-reimbursement arrangements, and that some applicants were ineligible because of loan type or role. The board approved putting the Section 127 plan in place by voice vote.
