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300 workers protest student-loan legislation

Published:March 18, 2010, 7:45 AM

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Updated: August 21, 2010, 5:12 AM

Sallie Mae, which owns the Pioneer Credit Recovery debt collection firm, is raising concerns about student- loan reform legislation that might be packaged with the health care bill in Congress, saying its provisions could lead to lost jobs.

Sallie Mae, the company that offers and manages government-guaranteed student loans, said it favors student-loan reform but advocates a different plan that it contends will not put jobs at risk. It also maintains that bundling the legislation with health care will deny the Senate a chance to properly debate the student- loan reform issues.

Pioneer Credit, which employs about 1,000 people at its operations in Arcade and Perry, is making a strong public push for its position. Tuesday, about 300 Pioneer Credit employees traveled to Buffalo on six buses to rally outside the district offices of Sen. Kirsten Gillibrand, D-N. Y., and Rep. Louise Slaughter, DFairport.

Across from the Larkin at Exchange building, home to Gillibrand’s office, employees wearing matching blue shirts chanted “Save Our Jobs!” and carried signs with similar messages.

Sallie Mae has previously reached out to lawmakers to get the point across, said Jeff Mersmann, vice president of operations for Pioneer Credit. “This takes it to another level,” he said.

Participation in the rally was voluntary, with employees offered the option of signing up to ride a bus to Buffalo, he said.

Conwey Casillas, a Sallie Mae spokesman, said employees have been tracking the reform issue for about a year and were asking for other ways to get involved. “They are concerned about their jobs, and they wanted to communicate that,” he said.

Last year, the House passed a student-loan reform bill that supporters said would save money by making the federal government the only originator of federal student loans, a shift that would deal a blow to private lenders. Some of the savings would be directed toward Pell Grants for low-income students. Backers of the reform effort say the overall thrust is to make college more affordable.

But some Senate Democrats have expressed concerns about the legislation’s provisions, citing fears about job losses in their home states.

Sallie Mae said it agrees that student-loan reforms are urgently needed but wants a different version of the legislation to be considered. It warns that if the current legislation is approved, some 400 of its jobs in New York State would be imperiled.

But Bethany Lesser, a spokeswoman for Gillibrand, said passing the legislation could generate new work for companies like Pioneer Credit.

“If more New York families can afford to send their children to college, then there will be an increased need for workers to process new loans, and we can sustain these jobs over the long term,” Lesser said.

President Obama’s legislation would help more than 67,000 middle-class families in New York afford the cost of college, Lesser said.

Slaughter supported the legislation that the House passed last year.

“I’m worried that our current system where public money needs to go through private banks does so at the expense of our students that can’t afford college,” Slaughter said. “Creating an efficient system and increasing money for Pell Grants are extremely important to improving the lives of the next generation of scholars and learners.”

On the jobs issue, Victoria Dillon, a Slaughter spokeswoman, said there are indications that switching to a “direct loan” program would not only preserve jobs but also bring back some jobs that had been moved offshore.

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