This Week In Washington
Interest rates on new federal student loans will fall about half a percentage point this upcoming school year. Student loan interest rates are statutorily tied to the Treasury Department’s auction for the 10-year Treasury note (high yield + 3.6 percent for unsubsidized graduate loans and 4.6 percent for Grad PLUS loans), which was held on Wednesday. While the sale price is not yet finalized and the U.S. Department of Education (ED) may do additional rounding, the new interest rate for graduate Direct Unsubsidized loans will likely be 6.08 percent (down from 6.6 percent) and Grad PLUS interest rates will be 7.08 percent (down from 7.6 percent). The new interest rates will take effect on July 1 and will be fixed for the life of each loan made on or after that date.
After last week’s subcommittee hearing, the full House Appropriations committee marked up the fiscal year 2020 education spending bill. The relevant higher education financing provisions did not materially change from the first mark up; thus, it still includes an additional $350 million for the fund dedicated to the Temporary Expanded Public Service Loan Forgiveness program and sets guidelines for ED’s solicitation and utilization of student loan servicers. However, the Committee now forbids ED from reversing Public Service Loan Forgiveness (PSLF) employment approval decisions except for administrative errors, and it also directs ED to produce monthly PSLF data reports. You can watch a replay of the markup here.
News You Can Use
Law.com reported on the recent release of the American Bar Association’s entry-level employment data for the class of 2018, including a visual dashboard of the data to show how law schools rank in several different job categories.
The following bill(s) have been recently introduced for consideration by the 116th Congress (2019-2020):
H.R. 2441 – What You Can Do for Your Country Act [Rep. John Sarbanes (D-MD-3) and Rep. Mark DeSaulnier (D-CA-11)] would reform PSLF in a variety of ways, including: the expansion of forgiveness to all federal student loan types and loan repayment plans, allowing borrowers to receive 50 percent forgiveness after five years, and simplifying the process to file employment certification forms and applications for forgiveness. H.R. 2441 is the House companion bill to S. 1203, which was previously introduced by Sen. Kirsten Gillibrand (D-NY). Read AccessLex Institute’s letter of support for the Senate bill here.
S. 1292 – Leveraging Opportunities for Americans Now (LOAN) Act [Sen. Marco Rubio (R-FL)] would eliminate interest on federal student loans and replace it with a one-time, non-compounding financing fee that borrowers would pay over the life of the loan.
H.R. 2563 | S. 1338 – Beyond the Box for Higher Education Act [Rep. Cedric Richmond (D-LA-2) et al. | Sen. Brian Schatz (D-HI) et al.] would support institutions of higher education with removing criminal and juvenile justice questions from their admissions applications by providing guidance and training to schools to change their policies.
S. 1377 – Ensuring Quality Access to Legal Defense (EQUAL Defense) Act of 2019 [Sen. Kamala Harris (D-CA)] would create a new $250 million grant to fund public defense by establishing workload limits for full-time public defenders, instituting pay parity between public defenders and prosecutors, and collecting annual data on public defender workloads. The bill would also authorize $5 million for government organizations and nonprofits to provide training for public defenders and reauthorize the John R. Justice Student Loan Repayment Program for prosecutors and public defenders—increasing the overall authorization amount from $25 million to $75 million.