PORTLAND, Maine — Two state financing agencies that provide college loans to students will merge under a new law Gov. Paul LePage signed Tuesday.
The law merges the Finance Authority of Maine and the Maine Educational Loan Authority, a move LePage proposed during this Legislative session and on Tuesday said is a “sensible consolidation.”
Shirley Erickson, the executive director of the Maine Educational Loan Authority, said in legislative testimony earlier this month that its loan servicer, Maine Education Services, planned to stop servicing the state authority’s private loan program September 30.
The organization considered other options for administering the program, Erickson wrote in a statement supporting the merger. The group’s board decided to support merging with FAME, putting the existing state agency in charge of administering its student loan programs.
The board of both financing agencies supported the bill.
Bill Norbert, spokesman for FAME, said it’s not yet been decided whether Erickson will become an employee of the financing authority. She is the only full-time employee at the Maine Educational Loan Authority.
Norbert said FAME will continue offering its loan programs for undergraduate education and people entering medical degree programs.
Bruce Wagner, CEO of the Finance Authority of Maine, said in legislative testimony that the combination will eliminate redundant functions at both agencies, cost less to administer and provide a single contact for students and families exploring college loans.
The merger will take effect 90 days after the Legislature adjourns.