This Week in Washington
Several high-ranking officials from the U.S. Department of Education (ED) shared updates this week on potential actions in the higher education space. New versions of the Borrower Defense to Repayment (DTR) and Gainful Employment regulations will be published before November 1st and “soon” respectively. Additionally, Mark Brown, the Chief Operating Officer of the Office of Federal Student Aid, expressed his belief that a reauthorization of the Higher Education Act will occur this Congress. Mr. Brown also indicated that ED would soon require students to “prove their financial literacy knowledge” at an “advanced level” before they sign a master promissory note. No additional details were provided about what this means or how it would be implemented.
On Tuesday, the House Judiciary Committee held a hearing about five separate bills addressing different aspects of the Bankruptcy Code. However, the majority of the hearing was focused on easing the dischargeability of student loans in bankruptcy (AccessLex supports reforming the Code as it pertains to student loans). While there seemed to be bipartisan consensus that something needed to be done to better assist borrowers struggling under the weight of their student loans, the two parties disagreed on the best way to accomplish that. You can watch a replay of the hearing here.
Led by Senator Brian Schatz (D-HI), fourteen Democratic Senators sent a letter to the College Board asking it to update some of its publications to “better reflect the true costs of attaining higher education.” Specifically, the Senators requested changes to the Trends in Student Aid and Trends in College Pricing reports because “the reports exclude many of the expenses that students in higher education face.” These lawmakers also took issue with how institutions’ net price was calculated because “students and families need to know what their total out-of-pocket costs will look like.” Note: AccessLex Institute has used data from these publications in our research in the past, and we stand by the accuracy of our reports.
Last week, Democratic Senators sent two letters to Education Secretary Betsy DeVos, seeking information and status updates on student loan discharge under the DTR regulations. These regulations govern the ability of borrowers to receive a loan discharge if their school is found to have defrauded them. Recall, ED has been slow to discharge loans under these regulations while it tries to rewrite them. In one letter, the Senators expressed concern about group discharges brought by states attorneys general, and in the other letter, the concern is about loan discharge under the DTR regulations more broadly.
News You Can Use
ACT’s Center for Equity in Learning released a report, based on a survey of college-bound high school students from all economic backgrounds, which found that most students have little knowledge of the student loan process. The report includes recommendations for higher education institutions and high schools to help increase financial literacy for students.
Two years after lifting limits, the Law School Admission Council announced that LSAT test-takers may only sit for the exam three times in a given year.
The following bills have been recently introduced for consideration by the 116th Congress (2019-2020):
H.R. 3334 – Expanding Access to Graduate Education Act [Rep. Ann Kuster (D-NH-2), et al.] would allow undergraduate students who received a Pell Grant to utilize the remaining eligibility towards their first graduate degree. Read AccessLex Institute’s letter of support here.
S. 1947 – College for All Act [Sen. Bernard Sanders (I-VT)] would provide new funding for states to make public colleges and universities tuition- and fee-free for all. The bill would also forgive all outstanding federal and private student loans.