Tackling Student Loans and Sustaining a Village by C. Ellen Connally
Nestled just south of Cleveland and abutting Cuyahoga Heights is the village of Newburgh Heights. Incorporated in 1904 with a population of 400, it has a land area of just .58 square miles. From the 1930s through the 1970s the population stayed constant, averaging 3800 residents, sustained by the steel and heavy industry that was a major part of the local economy. By the 21st century the decline of heavy industry, urban sprawl and changing demographics had taken its toll. The population was down to just over 2000 with less than 1000 households by 2014. There was a 10% decline in population from 2000-2014.
For those traveling on Interstate 77, the sign marking the exit to the Newburgh Heights goes largely unnoticed — except for those 300 or so drivers who, each month, are ticketed for violating the city’s 60mph speed limit. That has made the city famous or infamous depending on the number of points on your driver’s license. Long-time Mayor Trevor Elkins says the tickets are a matter of safety. Others strongly disagree, seeing the ticketing as merely a way to fill the city’s coffers, a position that Elkins scoffs at.
Like most inner-ring suburban mayors, Elkins faces many challenges. He governs a greying, blue collar community in the heart of the rust belt city that abuts some of the more blighted areas of Cleveland. About 80% of the residents of the village are white. The pleasant tree-lined streets are filled with pre-World War II-era houses and an infrastructure that lacks has the glitz of downtown, the ambiance of Ohio City or the residential developments and high-tech school systems of outer ring suburbs.
Seeking a stable, younger and professional population as the future to his village, Elkins recently proposed an ordinance that would seemingly attract just the kind of people that he is looking for. Known as the Student Loan Assistance Program, the program would help pay off student loans up to $50,000 for home owners in the village of Newburgh Heights who maintain their residence for at least 10 years.
The applicant must have purchased a single-family home valued at $50,000 or more within the village and must apply for the grant program within five years of graduating from a four-year accredited institution of higher learning with at least a bachelors or higher degree. The Newburgh Heights Community Improvement Corporation will agree to pay the lesser of 50% or $50,000 of the applicant’s verifiable student loan debt over fifteen-year span.
Introduced at a recent village council meeting, Elkins says he has the votes to pass the legislation and the finances and planning to carry out the program.
Over the last decade or so, city and state legislative bodies have taken it upon themselves to grant tax exemptions for industries doing business in their city or state to bring jobs and money into their locales. Cities often give tax abatements to new home builders and incoming companies with similar motives. None to my knowledge have adopted a more creative and innovative idea to keep neighborhoods stable, while maintaining existing housing stock than Elkins’ proposal. While the number of people it will impact will be small in comparison to the 44.2 million Americans who are saddled with $1.3 trillion dollars in student loan debt, it is a start that helps borrowers and the community and serves as a model for other programs.
With its proximity to Cleveland State University and other local institutions of higher learning, Newburgh Heights is a prime location. Its homes are affordable for first time buyers — they average in the area of $70,000 — and its proximity to interstate highways and Cleveland’s downtown reduce transportation cost for commuters while at the same time rejuvenating a neighborhood that could suffer the blight of other inner-ring suburbs that are filled with vacant and abandoned homes.
With the average student being in debt to the tune of $37,000, the repayment of student loans has become a major issue in America’s finances. Delinquent loans hamper credit ratings and the resultant inability to buy a house or car. Some job applicants complain that high debt has adversely affected their ability to gain employment. And with both parties in a marriage have outstanding loans, the problem is only doubled.
Many former students are still paying off loans as their own children face college. A prime example is Associate Justice of the United States Supreme Court, Clarence Thomas. He says in his autobiography that he did not pay off his student loans until he became a judge on the D.C. circuit court. As the second highest consumer debt in America, repayment of student loans is a major problem that often flies under the radar — unless you are one of those people who carry the debt.
Mayor Elkins, who has a background in government finance, has proposed a well-thought-out plan that would enhance his city and clearly help people with student loans. Clearly, this is a program that is dear to his heart. As a teenager he struggled to finish high school, having to work nights to sustain himself after his father was imprisoned and his stepfather deserted the family. His is a classic example of someone who pulled himself up by his boot straps — working his way through college and incurring student debt of his own.
With $1.3 trillion dollars in student debt looming over our economy, cities around the county along with our county and state government should look at ways to stem this financial crisis. Newburgh Village Mayor Trevor Elkins’ proposal to assist residents in paying off student loans is a wonderful start. The program deserves the support of all the entire community and should serve as a model for program around the state and the nation.