March 19, 2021

Higher Ed Policy Roundup: Vol. 5 - Issue 9

Policy and Advocacy

 

This Week in Washington

On Thursday, the U.S. Department of Education (ED) announced plans to rescind a policy enacted by the Trump administration that provided partial relief to students that were defrauded by their colleges. Recall that, in December 2019, ED rolled out a new procedure for calculating debt relief which provided defrauded students with partial, instead of full, loan forgiveness. The calculation drew criticism from many Democrats, including from Rep. Bobby Scott (D-VA-3) chairman of the House Education and Labor Committee, as not going far enough. ED estimates that the additional relief will cost $1 billion.

News You Can Use

The student debt forgiveness debate highlights the gender gap in what borrowers owe, as well as the role that race plays in that gender gap.

The Consumer Financial Protection Bureau encourages financial institutions and debt collectors not to seize stimulus payments.

How a tax break could push more companies to help workers pay off their student loans.

A new report by the JPMorgan Chase Institute finds that policy changes to student loan forgiveness are most effective if targeted by income.

Recent Legislation

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

The Repay Act [Sen. Angus King (I-ME)] would consolidate the various federal repayment programs into two plans: a fixed plan based on a payment ten-year period, and a single, simplified income-driven repayment plan that requires borrowers to pay 15 percent of their discretionary income.

H.R. 1918Student Loan Refinancing and Recalculation Act [Rep. John Garamendi (D-CA-3)] would allow student borrowers to refinance certain federal student loans at lower interest rates, lower future student loan interest rates, eliminate student loan origination fees, and allow some delayed interest accrual and deferred payments for qualifying borrowers.

H.R. 1912Keep College Students Learning Act [Rep. Rodney Davis (R-IL-13)] would ensure that a student who has received financial assistance from a college may delay or take a leave of absence for up to a year if the school does not intend to offer in-person instruction at an equal or higher level than as before the COVID-19 outbreak.