Author: Thomas P. Kennedy

New Law Addresses Pending Medicare Cuts

Of the ten counties that encompass the Hudson Valley, all but Putnam, Rockland, and Westchester are categorically considered rural, according to the U.S. Census Bureau. Unsurprisingly, rural residents often encounter barriers to healthcare that limit their ability to obtain the care they need. Certainly, the past year and a half tested the limit of patients, as well as overwhelmed hospitals, and physicians too. Luckily, Congress took action earlier this month to delay financial cuts that would have exacerbated already existing healthcare disparities in rural (and urban) areas and would have affected reimbursement to hospitals and physicians. If you’re not familiar with the “Protecting Medicare and American Farmers from Sequester Cuts Act” (doesn’t exactly roll off the tongue, we know) here is your opportunity to familiarize yourself with this critically important law that’s gained attention and support from many medical professionals.

On Friday, December 10, 2021, the President signed the “Protecting Medicare and American Farmers from Sequester Cuts Act,” into law, addressing several Medicare provider payment cuts slated to go into effect on January 1, 2022. The legislation includes helpful provisions for hospitals and providers. Specifically, the Act will:

Extend the 2% Medicare sequester moratorium until March 31, 2022, re-implementing 1% cuts in the second quarter of 2022, and reinstating the 2% cut subsequently, funded by backend increased sequester cuts in fiscal year 2030.
Adjust the Medicare Physician Fee Schedule (PFS) conversion factor by 3.00% in calendar year 2022.
Delay Protecting Access to Medicare Act (PAMA)-related cuts to clinical laboratory services and the next round of private payer data reporting by one year until January 1, 2023, with the phase-in extended through 2025.
Delay implementation of the Medicare Radiation Oncology Model until 2023; and
Delay application of 4% cuts to Medicare and other federal programs resulting from statutory Pay-As-You-Go- (PAYGO) Act requirements until calendar year 2023.

The American Medical Association (AMA) and many others had urged Congress to act to avoid cuts from taking effect at the start of 2022. Many have since spoken out with relief in support of the law. The American Clinical Laboratory Association, which represents Labcorp and Quest Diagnostics, issued a statement applauding the passage of the Act. The American College of Radiology (ACR) also applauds the news but urged lawmakers to look beyond what they described as “short-term” fixes.

Rick Pollack, president, and CEO of the American Hospital Association, said, “The AHA is pleased that the House has recognized that now is not the time to make cuts to hospitals and physicians under the Medicare program. By eliminating a 2% Medicare reduction until April 2022 and stopping the 4% Statutory Pay-As-You-Go (PAYGO) Medicare cuts from taking effect in early 2022, providers on the front lines of the fight against COVID-19 will not face additional imminent financial jeopardy as they continue to care for patients and communities.”

As hospitals and physician practices continue to recover from and navigate the emotional and financial impact of the COVID-19 public health emergency, our team is here to assist in every step along the way. Here at RBT CPAs, we understand the diverse and complicated world of healthcare. Our team of healthcare experts brings industry expertise in reimbursement, regulatory compliance and audit, accounting, and tax services. We will continue to keep you notified of timely news that matters to you and your team, but if you’d like to connect and receive individualized services, please contact us today. If you would like to submit feedback or topic ideas for future articles our team produces, please feel free to TLideas@rbtcpas.com.

Sources: White House, Congress.gov, GYNA

Why New York Doesn’t Rank as 2021’s Most Improved State

What comes to mind when you think about a state that’s set up for its communities to succeed and thrive?

There are more than 2 million small businesses in New York State, which employ 4 million people. These small businesses make up 99.8% of all businesses within the state and employ more than half the state’s workforce. We all know that local businesses help support the tax base through businesses taxes and the wages provided to employees. The possibility of workforce expansion and economic growth prompts municipalities, counties, states, and the federal government to offer various forms of assistance, from grants to research opportunities, beneficial legislation, and worker training programs. But not every state is up to speed on supporting businesses, and the end of the year provides the perfect opportunity to reflect on what New York is and is not doing to be competitive in the year ahead.

The business of ranking America’s top states for business in 2021 takes a lot of factors into consideration, and New York doesn’t land a top spot.

To determine rankings, CNBC scored all 50 states on 85 metrics in 10 broad categories of competitiveness. Each category is weighted based on how frequently states use them as a selling point in economic development marketing materials. Rather than an opinion survey, the criteria and metrics are developed in consultation with a diverse array of business and policy experts. This year, Maryland which ranks No. 12 overall, jumped an impressive 19 spots compared to the 2019 study, making it the year’s most-improved state. New York ranks No. 22 on the list. So, what sets Maryland apart, and where does our state fall short? Let’s dive in.

Broadband service in Maryland is among the best in the nation, at a time when connectivity has taken on new importance in the battle for business.

Maryland also has one of the most reliable power grids in the nation, with even more improvements in store. Maryland improved in eight of the study’s ten categories of competitiveness, but nowhere does Maryland improve more than in Infrastructure, where it finishes 8th in 2021, up from the 41^st spot in 2019.

Where are we falling short, New York?

Again, New York ranks No. 22. What really hurts the ranking seems to be two areas that likely won’t come as a surprise to our readers. New York ranks No. 41 in the Cost of Doing Business category, and No. 49 in the Business Friendliness category. The proximity to New York City provides excellent access to capital and skilled labor but New York businesses contend with high taxes and a complex regulatory landscape. The business income base tax for the state of New York is 6.5%, though certain businesses might qualify for a reduced 5.5% rate. In addition, businesses could be subject to a capital base tax or fixed dollar minimum tax. State law typically requires corporations to pay whichever is highest.

What’s the takeaway?

The good news is, when it comes to the best and worst states scored by internet coverage, speed, and price access, New York trails close behind Maryland (No. 4) in the No. 7 spot, according to BroadbandNow Research. Maryland is also ranked third for connectivity behind New York and New Jersey, which speaks volumes of New York’s recent investments in internet accessibility. To boost our competitive edge, it would serve local governments to get strategic about business incentives and consider further automation to make our grid even more reliable and efficient to withstand adverse weather events, incorporate cutting edge technologies, and prioritize changing customer needs. If your team or a local business you are serving has questions about complex business tax codes or regulations, we can help. Contact our dedicated Government group at RBT to schedule a consultation today. Additionally, if you would like to submit feedback or topic ideas for future articles our team produces, please feel free to contact us at TLideas@rbtcpas.com.

Sources: CNBC, BroadbandNow, SBA

Facing a Mass Exodus: How Strong is Your Financial Aid Office?

Just about every industry across the country is experiencing a widespread labor shortage.

In fact, the phenomenon is so prevalent that people are referring to it as ‘The Great Resignation’ as record numbers of workers are reevaluating and leaving their jobs amidst the ongoing pandemic. The U.S. Bureau of Labor Statistics reported that nearly four million Americans walked away from their jobs in April 2021—the most in a single month since the agency began tracking the statistic 20 years ago.

While companies nationwide are grappling with retaining talent, higher education institutions are facing a unique challenge of their own – shortages in financial aid offices. So what is the real impact of facing staff shortages in financial aid offices, and what might the financial implications be for your school?

Having fewer employees in the financial aid office can lead to consequences that extend far beyond longer customer wait times.

Over the last year, the National Association of Student Financial Aid Administrators (NASFAA) has reported an uptick in interest from institutions in the temporary staffing assistance that the association provides. In a recent interview with Inside Higher Ed, president and CEO of the NASFAA Justin Draeger said the challenge creates a disservice to both students and schools.

“Not only does it decrease services to students, especially at a time when students need the most help, but understaffing can also have a big impact on a school’s ability to be in compliance with the litany of federal and state requirements,” said Draeger.

While compliance is always important it’s especially critical now, as the Biden administration has openly shared plans to crack down on institutions that aren’t adhering to federal student aid program rules. The Office of Federal Student Aid at the Department of Education recently announced that it’s reviving the Office of Enforcement — which was deprioritized under the Trump administration — to “strengthen oversight of and enforcement actions against postsecondary schools that participate in the federal student loan, grant, and work-study programs.”

The bottom line?

Even if your financial aid office is fully staffed right now, you need to create long-term retention plans today so you don’t run into issues tomorrow. Some colleges across the country are staying prepared and finding success by streamlining and automating office processes. A good chatbot, for example, can answer hundreds, if not thousands, of routine questions, in real-time, in multiple languages, any time of day. They can be trained to refer especially tricky questions to staff for personal answers. Other successful strategies include cross-training employees, and even hiring work-study students who are already well trained with office practices.

“In the end, schools can pay now — by hiring and retaining staff — or pay later, when they are found out of compliance and face possible federal fines and penalties,” Draeger said.

Making a plan today to alleviate stressors that your financial aid officers face can be the difference between struggling or succeeding in the upcoming academic year. If you’d like your financial aid office to have an opportunity to review compliance with complex tax laws, our dedicated education team is here to help develop a personalized, long-term strategy for your staff. Contact us today here. Additionally, if you would like to submit topic ideas for future articles our team produces, please feel free to contact us at TLideas@rbtcpas.com.

Sources: NASFAA, Inside Higher Ed, University Business

Rolling a 401K into a Roth IRA

While the goal is to retain loyal employees (rather than constantly hiring and training), the reality is most Americans don’t stay in one job their whole lives. According to the Bureau of Labor Statistics, it turns out that the average person has 12 jobs over a 32-year span! Fortunately, 401(k) plans are portable. Do you know the benefits and penalties involved with each choice? It’s important to stay up to date so you can keep your team informed.

If a person decided to roll over their former employer’s 401(k) directly into a new employer’s plan, they’ll have to:

Arrange the rollover with the new 401(k) plan administrator. They may have to select the investments they’d like to make before they complete the rollover. Otherwise, they can transfer the lump sum and allocate it gradually to investments of their choosing
Complete the forms required to move their money from the former employer’s plan
Ask their former plan administrator to send a check or electronically transmit the account value directly to the administrator of their new plan

When a person retires or leaves a job for any reason, they have the right to roll over 401(k) assets to an IRA. There are several direct rollover options:

Rolling a traditional 401(k) to a traditional IRA

They can roll traditional 401(k) assets into a new or existing traditional IRA. To initiate the rollover, one must complete the forms required by both the chosen IRA provider and 401(k) plan administrator. The money is moved directly, either electronically or by check. No taxes are due on the moved assets, and any new earnings accumulate tax deferred.

Rolling a Roth 401(k) to a Roth IRA

They can roll Roth 401(k) assets into a new or existing Roth IRA with a custodian of their choice. One must complete the forms required by the IRA provider and 401(k) plan administrator, and the money is moved directly either electronically or by check. No taxes are due when the money is moved and any new earnings accumulate tax deferred. Earnings are eligible for tax-free withdrawal once the IRA has been open for at least five years and the employee is at least 59½.

Rolling a traditional 401(k) to a Roth IRA

If a traditional 401(k) plan permits direct rollovers to a Roth IRA, they can roll over assets in their traditional 401(k) to a new or existing Roth IRA. Keep in mind they’ll have to pay taxes on the rollover amount they convert.

For 2022, 2021, 2020, and 2019, the total contributions a person makes each year to all of their traditional IRAs and Roth IRAs can’t be more than $6,000 ($7,000 if age 50 or older), or if less, your taxable compensation for the year. It’s a good idea to check in with your company’s plan administrator as well as a tax advisor to determine whether a move from a traditional 401(k) to a Roth IRA is allowed, and the right choice. RBT CPAs, LLP’s tax team has developed guidelines that help us perform client work as efficiently and effectively as possible. We assign experienced staff and gather industry knowledge from Firm resources and market research, to identify and target issues significant to your business. Contact us to set up a primary consultation to learn more about what we can do for you.

Sources: IRS, FINRA

The Latest on NY’s Education Spending

While it’s easy to get wrapped up in daily expenses, it’s a good idea to check in on the Office of the State Comptroller’s monthly contract approval list to understand where funding is headed.

In September, the Office of the State Comptroller approved 1,515 contracts for state agencies and public authorities valued at $2.4 billion and approved nearly 5.4 million payments worth almost $15.4 billion. What is the NY Comptroller’s office approving in terms of education spending?

Included in September’s state payments:

$2.7 billion in general aid to 678 school districts
$360,000 in excess cost aid for school-aged special education students to six school districts

Within the State University Construction Fund, over $65 million was approved for various university renovations that are underway. Specifically:

$28.8 million with FAHS Construction Group Inc. to renovate the Bartle Library 3rd floor and penthouse at Binghamton University
$20.1 million with Manning Squires Hennig Co., Inc. to renovate Crosby Hall at University at Buffalo
$16.3 million with Upstate Companies 1, LLC to renovate Silverman Hall at Upstate Medical University

The State University of New York which spans 64 campuses across the state had a lot to gain with the latest OSC contract list.

As the largest comprehensive system of universities, colleges, and community colleges in the United States, with a total enrollment of over 400,000 students, plus more than 2 million adult education students, a few University projects stood out. In particular, OSC is spending:

$18.4 million with Boilermatic Welding Industries Inc. for boiler maintenance and repair services at Stony Brook University
$5.6 million with Apogee Telecom Inc. for internet access service at the University at Albany
$5.5 million with D2L LTD for an online digital learning environment
$3.9 million with Sunquest Information Systems Inc. for maintenance and support services of Sunquest Laboratory Information Systems at Upstate Medical University
$3 million with Cerner Health Services Inc. for maintenance and support services of Eagle 2000 software at Downstate Health Sciences University
$2.3 million with Southeast Mechanical Corp. for condensate water piping replacement at SUNY New Paltz
$1.7 million with All-Con Contracting Corp. for Campus Center upgrades at SUNY Old Westbury

Additional spending is going towards the Student Conservation Association Inc. for conservation and educational recruitment services ($4 million), and to the NYS Federation of Growers’ & Processors’ Associations Inc. to provide early childhood education and social services under the Agri-Business Child Development Program ($1.7 million). Three of New York’s eight ABCD Centers are actually located within Hudson Valley to serve our Florida, Middletown, and New Paltz, community members.

When your team is planning future budgets and considering future projects, consider checking in on the OSC’s official website to determine what projects are receiving funding.

More information on the latest approved contracts and payments is available at www.openbooknewyork.com but if you have immediate questions about strategic financial planning, our dedicated RBT professionals are here to help. Contact us today, here. Additionally, if you would like to submit feedback or topic ideas for future articles our team produces, please feel free to contact us at TLideas@rbtcpas.com.

Source: OSC, ABCD

Local Sales Tax Collections Up 20% in Third Quarter

The height of the COVID-19 pandemic spelled financial disaster for communities across the country. I’m sure you remember feeling the panic that set in, as local leaders grappled with prioritizing public safety amidst an unprecedented health crisis while simultaneously dealing with an economic nosedive. Just how bad did it get, and what stage of recovery is our state in today? Read on to get a recap of where we’ve been, how the rebound looks, and what’s ahead for our communities.

Local governments depend heavily on sales taxes as a major source of revenue, but as New Yorkers stayed home and bought less during the pandemic it created significant shortfalls within communities and collectively statewide. New York sales tax collections dropped by $1.8 billion or 10% in 2020 compared to 2019, State Comptroller Tom DiNapoli said in a report released in February 2021. For perspective, that’s a steeper drop than in the 2009 recession, when collections dropped 6%. Sales tax revenue dropped most sharply in the second quarter as former Gov. Andrew Cuomo closed nonessential businesses statewide. Collections plummeted 27.1% from April to June compared to the previous year. Drops in sales tax collection in New York City, which represents over 40% of sales tax collections statewide, fueled much of the state’s losses. The city saw a 35% drop from April to June, then a roughly 20% dip for the rest of the year.

While the pandemic isn’t over, things are finally starting to look up. Now, nearly two years later, local sales tax collections continue to show year-over-year growth after significant drops. Local sales tax collections totaled $5.2 billion in the third quarter (July-September of 2021), up $861 million (20%) from the same period last year and continuing the trend of exceeding pre-pandemic levels, according to a State Comptroller report released on October 28, 2021. Statewide, every region saw solid growth in sales tax collections during the third quarter compared to the same period last year. Outside of New York City, the July-September period marked the fifth quarter in a row that county and city sales tax receipts met or exceeded 2019 pre-pandemic levels for the same period. Some of the regions with the strongest third-quarter growth include Mid-Hudson (16.5%), Long Island (16.3%), and the Capital District (15.4%).

State property tax is telling a different story, and according to the latest data from the State Comptroller’s office, the New York City office market will take years to recover from the pandemic, with over $850 million in property taxes lost in the 2022 fiscal year. The traditional commercial property value is shifting dramatically, and I’m sure you’ve felt this crunch in your own community. The pandemic meant innovating and embracing remote working models, and the reality is while companies may have anticipated these alternative setups as temporary fixes, the majority of Americans have no interest in going back to the “old model” of work in an office building. According to a recent survey by FlexJobs, 65% of remote workers do not want to return to their offices, and many employers are continuing to use a remote work arrangement. Additionally, an employee working from home in a state where the employer is not headquartered creates several issues that we will likely be working out for years to come.

Overall, strength in statewide local collections likely reflects national changes. The U.S. Census Bureau’s advance monthly retail trade report shows strong year-over-year growth for the third quarter, especially in sectors such as gas stations (38%), clothing stores (35%), and restaurants and bars (34%). Increased costs for goods also increase sales tax collections, and the price of consumer goods and services during this third quarter grew by 5.3% over the same period last year, as measured by the Consumer Price Index. Looking ahead, local governments need to continue closely monitoring the overall employment and real estate markets, including differences in submarkets. By tracking what’s going on in your community, you can deliberate carefully over strategic choices to influence office employment and space and ensure that policy decisions will alleviate negative impacts on tax revenue and the economy. It’s also important for local governments to closely monitor changes as supply chain shortages and workforce disruptions continue to be huge factors in economic recovery. Want to consult one of our RBT government team professionals? Contact us today.

Sources: OSC, AP News

Why You Should See the Value in Digital Vision Care

Chances are, your healthcare team has launched a telehealth campaign to stay connected to patients throughout the ongoing COVID-19 pandemic.

One area that’s lacking and has huge room for growth? Virtual eye care. Telemedicine in optometry can expand patient access to care, improve coordination of care, and enhance communication among all health care practitioners involved in the care of a patient. Despite vision care benefits being underutilized, Americans see the value. According to the CDC, about 93 million adults in the United States are at risk for vision loss. The COVID-19 pandemic may cause that number to increase because many Americans are delaying or going without care to avoid the risk of exposure to the virus. Visits to the eye doctor have dropped by an estimated 80% during the COVID-19 pandemic.

By increasing online access to eye doctors as we have with other types of primary care, benefit utilization will grow as will patient comfort.

Telemedicine can diagnose eye diseases like glaucoma and diabetic retinopathy. Eye doctors may also provide other remote non-emergency services, like diagnosing and treating eye infections, prescribing or changing medicines, or rescheduling surgery. Usually, with only traditional vision plans at their disposal, most Americans can’t afford to make routine eye exams and new glasses part of their family’s yearly health routine. But for the vast majority of American families – and school-age children in particular – the pandemic meant a huge increase in screen time, which means eye exam access will become more crucial than ever before. Experts foresee this as signaling eye health trouble ahead and an influx of patient care in the world of optometry.

Alina Dumitrescu, MD, a clinical associate professor of pediatrics, ophthalmology, and visual science at the University of Iowa Hospitals and Clinics, said virtual schooling during the pandemic has added, on average, an additional 2 to 3 hours of screen time a day. Dr. Neeraj K. Singh, BSOptom, MPhil, PGD (Epidemiol), said the most common problems associated with increased screen time are eye strain, dry eye diseases, and myopia progression. Experts anticipate myopia (nearsightedness) will affect nearly a third of Americans by 2050.

So, how can establishing digital eye care benefit your medical organization?

This September, The Congressional House Ways and Means Committee unveiled and began marking up legislative proposals, as part of the committee’s jurisdiction under the budget reconciliation instructions, that would expand Medicare coverage to add dental, vision, and hearing benefits. Specifically, the committee’s proposal would create coverage for vision services under Medicare Part B beginning October 1, 2022, which would include routine eye examinations. Why not get ahead of the influx of patient appointment requests, by implementing telehealth options now? If your organization opts to see the future in telehealth optometry, you will have the support of the American Optometric Association (AOA). AOA officially announced their support for telemedicine in optometry to access high-value, high-quality eye, health, and vision care back in 2020.

The explosion in telehealth services and the continual growth of e-commerce both point to long-lasting shifts for American workers and families.

As millions transition to remote work and a growing number of students opt for remote education, more flexible and innovative vision benefits will help boost benefit utilization and revenue generation. While telemedicine in optometry should not replace entire categories of care available in-person, experts agree that it is an industry game-changer. Questions? Contact RBT’s team of healthcare experts today to set your organization up for financial success.

Sources: CDC, Benefit News, AOA, Ophthalmology Advisor

Plan Breakdown: Qualified VS Non-Qualified, and Why it Matters

Even in a pre-pandemic economy, attracting and retaining top talent was a challenge across industry lines.

A recent Glassdoor survey revealed that four in five employees would prefer new or additional benefits over a pay raise. More specifically, 89 percent of younger employees, those between 18 and 34, would prefer benefits to more money in their paycheck.

While increased health-care insurance was the most valued benefit (40 percent), retirement plan and/or pension ranked fifth, at 31 percent. Flexible scheduling — which has become the norm for many in the current work from home environment — followed retirement savings, at 30 percent. So let’s brush up on The Employee Retirement Income Security Act, and have a brief refresher on the differences between qualified verses non-qualified plans, to make sure you are offering your employees competitive retirement and benefit plans to keep them satisfied.

What is ERISA?

The Employee Retirement Income Security Act (ERISA) is a federal law that was enacted in 1974 to set minimum standards for most voluntarily established pension and health plans. It was established because at the time, state and federal laws didn’t adequately protect employee benefit plan participants and beneficiaries. It requires plan sponsors to provide plan information to participants. It establishes conduct standards for plan managers and other fiduciaries as well as enforcement provisions to ensure that plan funds are protected and that qualifying participants receive their benefits, even if a company goes bankrupt.

Who does ERISA protect?

ERISA covers retirement plans and welfare benefit plans. In FY 2013, ERISA encompassed roughly 684,000 retirement plans, 2.4 million health plans, and 2.4 million additional welfare benefit plans. These plans cover about 141 million workers and beneficiaries and include more than $7.6 trillion in assets. About 54 percent of America’s workers earn retirement benefits on the job, and 59 percent earn health benefits.

Qualified vs Non-Qualified Plans

So, what’s the difference between qualified and non-qualified plans? Qualified plans qualify for certain tax benefits and government protection. Nonqualified plans do not meet all ERISA stipulations.

Qualified plans are the most rigid, as they require a number of guidelines to qualify — including vesting, benefit accrual, and funding restrictions. A few of the most well-known qualified retirement plans, include:

401(k) profit-sharing plans: a retirement savings plan offered by many American employers that has tax advantages to the saver. It is named after a section of the U.S. Internal Revenue Code.
403(b) plans: a retirement account for certain employees of public schools and tax-exempt organizations. Participants include teachers, school administrators, professors, government employees, nurses, doctors, and librarians.
Keogh (HR-10) plans: tax-deferred pension plans—either defined-benefit or defined-contribution—used for retirement purposes by either self-employed individuals or unincorporated businesses, while independent contractors cannot use a Keogh plan.

Non-qualified plans leave a more flexible variety of possibilities for employees and are generally used to provide high-paid executives with an additional retirement savings option. However, employees pay taxes on funds before contributing to the plan in non-qualified plans, and typically, an employer is unable to claim these contributions as a tax deduction. Additionally, according to Investopedia, a non-qualified employee benefit plan has no limit on contributions from the employer and requires minimal reporting and filing on the employer’s part, and are usually less money to create than qualified plans. There are four major types of nonqualified plans:

Deferred-compensation plans: a written agreement between an employer and an employee in which part of the employee’s compensation is withheld by the company, invested, and then given to the employee at some point in the future.
Executive bonus plans: provide supplemental benefits to select executives and employees. Most commonly, employees under such plans receive a life insurance policy with employer-paid premiums.
Split-dollar life insurance plans: utilized when the employer purchases a life insurance policy for the employee, and they split the ownership of the policy.
Group carve-out plans: utilized in order for the employer to carve out the group life insurance of a key executive and replaces it with an individual policy. It allows the employee to avoid excess costs associated with a group plan.

Whether you offer a diverse range of options for your team, or this refresher has given you some inspiration about changes your administration needs to make, it’s always a good idea to reevaluate what your company offers. Staying competitive as we approach 2022 means staying innovative, implementing improvements, and keeping your team motivated and happy to stay successful and reach new goals. If you have any questions about updating your policies, please reach out to our team of dedicated professionals.

Sources: DOL, Investopedia, CFI, Glassdoor

Must Share Info: Resuming Student Loans

January might feel far away, but it will be here before you know it (along with freezing temperatures and lots and lots of snow, sorry New Yorkers, you know the drill). Like winterizing your home or prepping for the change in seasons, millions of student loan borrowers have another addition to tack onto their winter to-do list before we hit the New Year. Overall, there are 2.7 million student loan borrowers in New York, with debt totaling $99.8 billion. New York borrowers carry an average balance of $35,638 each — though that’s 3% lower than the average borrower in the U.S. ($36,689). Below, you’ll find extremely important and time-sensitive student loan repayment reactivation information to pass along to student loan borrowers in your life before time runs out.

Student loan payments, interest accruals, and collections of defaulted federal student loans have all been on hold since the start of the pandemic — first thanks to the CARES Act, then due to extensions from former President Donald Trump, former Education Secretary Betsy DeVos, and President Biden. This August, the U.S. Department of Education announced a final extension of the student loan payment pause until Jan. 31, 2022.

So, how can borrowers prepare for repayments to resume?

Below are three steps to pass along to borrowers, so they can ensure they’re prepared for payments to resume:

Update your contact information in your profile on your loan servicer’s website and in your StudentAid.gov profile.
Check out Loan Simulator to find a repayment plan that meets your needs and goals or to decide whether to consolidate.
Consider applying for an income-driven repayment (IDR) plan. An IDR plan can make your payments more affordable, depending on your income and family size.

A further note on repayment strategy – now is a good time for borrowers to reassess their future plans. Encourage borrowers to make sure they can afford the payments when they resume, and if not, dedicate time now to determining what repayment options may be available instead of waiting until January. It’s best to have a list of financial advisers, or certified student loan experts readily available to offer borrowers resources to provide assistance and direction. Also, make sure they know that once the payment suspension ends, they will receive a billing statement or other notice at least 21 days before the payment is due. Encourage them to contact their loan servicer online or by phone to find out what the payment amount will be when payments restart. Loan servicers are the most reliable source for official, up-to-date information about loans. Another helpful tip? The U.S. Department of Education wants to help borrowers learn how to avoid scams. Student loan borrowers should never accept unexpected offers of financial aid or help (such as a “pandemic grant” or “Biden loan forgiveness”) without checking with their school to see if the offer is legit.

The pandemic caused economic shockwaves across the nation, regardless of economic status, everyone surely felt some level of impact.

From family members losing jobs to falling ill, many entered saving mode due to extreme stress and uncertain financial times. Be sure to pass along compassion to borrowers you connect with and direct them to resources. The Federal Student Aid site provides the latest updates about coronavirus student loan relief and its impact on students, borrowers, and parents. For more information on student loan forgiveness legislation, visit the U.S. Department of Education’s website. Of course, our dedicated RBT professional team is also here to provide personalized guidance.

Sources: U.S. Department of Education, Student Loan Hero

Understanding Facial Recognition in Your Own Backyard

If you’re not familiar with facial recognition (FTR), it’s time to learn the basics.

The reality is, it’s already playing a part in your life whether you know it or not. FTR is a type of biometric technology that mimics how people identify or verify others by examining faces. Recent advancements have increased the accuracy of automated FRT. The result? More communities are adopting it than ever before across a range of applications, but the technology is still far from perfect.

Critics like civil liberties groups argue facial recognition contributes to privacy erosion and reinforces biases.

Despite concerns, the use of FRT continues to explode, so it’s increasingly important to understand its use in government. That’s why GAO recently conducted a survey to learn how federal governments are implementing this technology. Currently, most state legislatures – including New York – have rejected bans and severe restrictions on facial recognition. So what does this mean for the future of public safety in your community?

GAO’s report surveyed 24 federal agencies about their use of FTR:

16 reported using it for digital access/cybersecurity, such as allowing employees to unlock agency smartphones with it
6 reported using it to generate leads in criminal investigations
5 reported using it for physical security, such as controlling access to a building/facility
10 said they planned to expand its use through fiscal year 2023. For example, an agency plans to pilot the use of FRT to automate the identity verification process for airports travelers

At the municipal level, the number of localities considering broad bans on facial recognition has been limited in 2021 to just three.

Minneapolis and King County, Washington, passed bans on government use, while the Baltimore City Council recently approved the most expansive ban so far that also restricts personal and business use, joining Portland, Oregon, as one of the only two local jurisdictions out of 18 moving to restrict private-sector applications in addition to banning local government use.

So, how does the public feel about FTR?

Every community is different, so the residents in your community may be more supportive, or perhaps more skeptical than the survey results we’re about to share. Insight platform Piplsay polled 31,184 Americans this August to understand people’s views on the uses of facial recognition technology in public spaces. The poll respondents were told that some major U.S. retailers like Macy’s and Lowes have been using facial recognition to help to better detect organized retail theft. Forty percent of people surveyed were unaware of this fact and while 42 percent of people said they did not mind this, 38 percent did not support the use of the technology.

Many Americans surveyed on the subject agree that facial recognition is a helpful tool to crack down on fraud and crime, but the major concern seems to be a lack of transparency about the tech and the personal data being collected. The takeaway? If localities opt to simply disclose the use of the technology to the general public, it would likely garner more widespread support. The best gauge would of course be to start an open dialogue at your next in-person, or virtual community meeting.

What’s the latest here in New York?

New York City is the latest U.S. city to enact a biometric privacy law. Effective July 2021, the law puts new limits on what businesses can do with the biometric customer data, giving New Yorkers greater protections over how their data is collected and used. Businesses that collect biometric information — most commonly in the form of facial recognition and fingerprints — are required to post notices and signs at their doors explaining how customer data will be collected. The ordinance applies to a wide range of businesses — retailers, stores, restaurants, and theaters, to name a few — which are also barred from selling, sharing, or otherwise profiting from the biometric information that they collect. Businesses can face stiff penalties for violating the law but can escape fines if they fix the violation quickly. While your locality hasn’t yet adopted any specific biometrics or facial recognition laws, it’s bound to remain a hot button topic for years to come. It’s a good idea to keep this growing tech on your radar and check in with local leaders and constituents to gauge their perspectives. At RBT, we understand that governmental entities face enormous challenges every day and that it can be difficult to keep up with ever-evolving policies and technology. Please reach out to our trusted team if you have questions and feel free to schedule a consultation.

Sources: Biometric Update, Security Info Watch, GAO