Higher Ed Policy Roundup: Vol. 7 - Issue 34

On Wednesday, the Biden-Harris Administration approved another round of federal student loan forgiveness totaling $9 billion for 125,000 borrowers. The debt forgiveness comes from fixes that the Education Department (ED) made to the Public Service Loan Forgiveness program, income-driven repayment plans, and the debt forgiveness program for borrowers with total and permanent disabilities. In total, the Biden-Harris Administration has provided $127 billion in federal student loan forgiveness to 3.6 million borrowers.

Late last week, ED released an issue paper to prepare negotiators for the upcoming negotiated rulemaking session to begin drafting regulations relating to the modification, waiver, or compromise of federal student loans. Recall that after the U.S. Supreme Court ruled against the Biden-Harris Administration’s debt forgiveness plan, President Biden announced that his administration would pursue debt forgiveness through the negotiated rulemaking process using the Higher Education Act. The issue paper asks negotiators five questions to consider prior to the first session including ways to help borrowers whose student loan balances have ballooned due to the accrual of unpaid interest. The first session is scheduled to take place October 10 and 11.

A group of state attorneys generals sent a letter to President Biden and Education Secretary Cardona expressing "serious concerns" with the student loan repayment process, suggesting borrowers should not have to begin repaying their loans until the Administration resolves these issues.

Over 300 U.S. higher education institutions have agreed to standardize information in their financial aid offers, a move prompted by the College Cost Transparency Initiative, spearheaded by 10 higher education associations to increase transparency in aid offers. Read AccessLex Institute’s recommendations for standardization.

The following bill(s) have been recently introduced for consideration by the 118th Congress (2023-2024):

H.R. 5710 – Student Loan Refinancing and Recalculation Act [Rep. John Garamendi (D-CA-8)] would allow students with federal loans to refinance their interest rates, lower future interest rates, eliminate origination fees on student loans, defer interest rate accrual for low-income and middle-class borrowers while they are pursuing their education, and eliminate interest capitalization for federal student loans.