Higher Ed Policy Roundup: Vol. 5 - Issue 15

On Monday, Education Secretary Miguel Cardona announced that Richard Cordray will be the new Chief Operating Officer of the Office of Federal Student Aid. Cordray previously served as the Director of the Consumer Financial Protection Bureau, which regulates and oversees consumer financial entities, including private student lenders.

On Wednesday, more than 50 lawmakers sent a letter to Secretary Cardona asking him to strengthen the Public Service Loan Forgiveness (PSLF) program. Specifically, the letter urged Cardona to invoke the Higher Education Relief Opportunities for Students (HEROES) Act of 2003, which provides the Education Department (ED) with the authority to “waive or modify any statutory or regulatory provision applicable to the student financial assistance programs under title IV” during a national emergency. The lawmakers also asked Cardona to modify the PSLF program by:

·       Expanding the definition of “eligible loan” to provide relief for borrowers with any type of federal student loan and prior payments on consolidation loans;

·       Expanding the definition of a qualifying payment plan for all borrowers;

·       Waiving the restriction that a borrower be employed in public service at the time of forgiveness; and

·       Establishing data-sharing agreements to automatically qualify borrowers for PSLF using administrative data.

The House Appropriations Labor, Health and Human Services, Education and Related Agencies Subcommittee held a hearing titled "FY2022 Budget Request for the Department of Education.” In his opening remarks, Secretary Cardona noted that the budget request would make good on President Biden’s desire to correct the years of underinvestment and inequities in Federal education programs. He also highlighted that the request would increase support at Historically Black Colleges and Universities, Tribally Controlled Colleges and Universities, and Minority Serving Institutions. You can watch the hearing here.

Is the federal student loan program facing a $500 billion shortfall? One banker thinks so.

Three ways the Biden Administration can help student loan borrowers affected by the pandemic.

Dr. Beth Akers, resident fellow at the American Enterprise Institute, penned an op-ed on why she thinks change in congressional reconciliation rules takes pressure off Biden to forgive student debt.

The following bills have been recently introduced for consideration by the 117th Congress (2021-2022):

H.R. 2912 – Truth-In-Tuition Act [Rep. Matt Cartwright (D-PA-8)] requires institutions of higher education to provide students with price models of tuition levels over the course of their studies.

H.R. 2917 – Retirement Parity for Student Loans Act [Rep. Danny Davis (D-IL-7)] would let certain retirement plans make matching contributions to workers as if their student loan payments were wage reduction contributions.

S. 1445 – Know Before You Owe Federal Student Loan Act [Sen. Chuck Grassley (R-IA)] would mandate annual counseling before new loans are disbursed and require institutions to share more information with students as part of loan counseling.

S. 1448 – Net Price Calculator Improvement Act [Sen. Chuck Grassley (R-IA)] would require schools to make net price calculators more user-friendly and accessible and authorize ED to develop a “universal calculator” to be used by students.

S. 1452 – Understanding the True Cost of College Act [Sen. Chuck Grassley (R-IA)] would require institutions of higher education to use a uniform financial aid award letter, developed by ED and relevant stakeholders.

S. 1464 – Student Loan Disclosure Modernization Act [Sen. Tim Scott (D-VA)] directs ED to create an easy-to-understand disclosure form outlining Direct Loan borrowers’ fiscal obligations and legal rights before disbursing a new loan. This is a companion bill to H.R. 2874, which was introduced in the House by Rep. Emanuel Cleaver (D-MO-5).