June 9, 2023

Higher Ed Policy Roundup: Vol. 7 - Issue 19

Policy and Advocacy


This Week in Washington

On Wednesday, President Biden vetoed the Congressional Review Act (CRA) aimed at stopping the Biden-Harris Administration's debt relief plan that would forgive up to $20,000 of student debt and end the pause on student loan payments and interest. Recall that last week, the Senate passed the CRA on a 52-46 vote. Democratic Senators Joe Manchin (D-WV) and Jon Tester (D-MT), and Independent Senator Krysten Sinema (I-AZ), joined their Republican colleagues in voting for the CRA.

Over the weekend, President Biden signed the Fiscal Responsibility Act into law which addressed the previously looming debt ceiling crisisRecall that the bill also ends the pause on student loan payments and interest, which the Biden-Harris Administration had planned to end 60 days after the U.S. Supreme Court ruled on the Administration’s student debt cancellation plan or 60 days after June 30, 2023. According to the bill, the pause must end no later than 60 days after June 30, 2023, and bars the Biden-Harris Administration from any additional extensions. 

Additionally, after the debt ceiling bill was signed into law, SoFi Technologies Inc. (a student loan refinancing company) dropped its lawsuit against the Biden-Harris Administration asking the U.S. District Court for the District of Columbia to end the student loan forgiveness pause.

News You Can Use

Millennial borrowers are estimated to lose 6.5 percent of their spending power once student loan payments resume.

The Federal Student Aid Office recently published a guide to help financial aid administrators understand and prepare for the upcoming changes to the Free Application for Federal Student Aid.

A working paper from the National Bureau of Economic Research explored the financial effects of the student loan pause on borrowers and found that the payment pause led to a decrease in student loan delinquency and higher credit scores.

Recent Legislation

There were no relevant student-aid related bills recently introduced for consideration by the 118th Congress (2023-2024).