In an effort to help graduate students pay off debt, U.S. Senators Shelley Moore Capito (R-W.Va.) and Gary Peters (D-Mich.) introduced legislation that would help attract recent graduates to communities that have high poverty rates. 

Senator Capito says the grants are awarded by community foundations to recent graduates to pay down their student debt if they live and work in regions with unmet need.

The bipartisan bill, called the Workforce Development through Post-Graduate Scholarships Act would allow private foundations to help graduate students pay off their student loan debt through scholarships. The scholarships would be non-taxable to the student and count as a charitable donation for the foundation. 

“In addition to helping students pay off debt, it will encourage the best and brightest to stay in West Virginia once they graduate,” said Senator Capito. 

Recipients of post-graduation scholarships are currently required to pay income tax on the grant.