The Biden administration provided an update last week about its continued attempt to bail out student loan borrowers, an effort that's been underway since the Supreme Court in June struck down the president’s plan to use the HEROES Act of 2003.
On Friday, the Department of Education released a paper laying out a new plan to enact broad debt relief, this time using the Higher Education Act of 1965.
Negotiations with stakeholders will now take place, the administration said, identifying five groups of borrowers that it's focusing on: "borrowers whose balances are greater than what they originally borrowed, whose loans first entered repayment decades ago, who attended programs that did not provide sufficient financial value, who are eligible for relief under programs like income-driven repayment but have not applied, and borrowers who have experienced financial hardship and need support, but for whom the current student loan system does not adequately address."
“The Biden-Harris Administration has taken unprecedented action to fix the broken student loan system and deliver record amounts of student debt relief,” said U.S. Secretary of Education Miguel Cardona in a statement. “Now, we are diligently moving through the regulatory process to advance debt relief for even more borrowers… [A]fter considering more than 26,000 public comments on how to tailor this relief, we are releasing this additional information about this effort."
The debt relief issue paper will be discussed at the first meeting of the Student Loan Relief Committee, which is scheduled to take place October 10 and 11. The committee will be comprised of non-federal negotiators from 14 affected constituency groups, as well as a negotiator from the Department. During the session, the non-federal negotiators will provide input on the policy considerations and questions outlined by the Department, as well as identify any new proposals they may have. Members of the public will also have an opportunity to provide comments at the end of each day. Through this process, the Department will continue to develop regulatory text for consideration. The committee is also scheduled to meet in November and December. The public will have an opportunity to submit written comments on the draft rules when they are published next year.
The Department is also releasing a list of the individuals who will serve on the negotiating committee, which can be found here. These individuals were chosen based upon review of the nominations received in response to the Department’s request for nominations. (Department of Education)
"We’re committed to standing up for borrowers and making sure that student debt does not stop anyone from climbing the economic ladder and pursuing the American dream," Cardona added.
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