A year ago, President Joe Biden’s plan was to forgive up to $20,000 in student loan debt for tens of millions of Americans.
With that plan now extinct, the first of several conversations to hash out a new strategy for erasing loan balances en masse begins Tuesday.
“Creating clearer regulations will ensure the authority to waive student debt is used in a fair and lawful manner,” said James Kvaal, under secretary of education. “We believe that doing so will strengthen the entire student loan system, help us tackle pervasive problems in the system, and help ensure postsecondary education is a path to opportunity for more students.”
As the process of negotiated rulemaking, or neg reg as it’s sometimes called in federalese, gets underway, tens of millions of Americans are wrestling with student loan payments for the first time in more than three years. Social media is littered with evidence of confusion about the size of monthly payments. Some people say they are puzzled about why they are being billed at all. One set of borrowers has their payments set to zero because of a new federal repayment option called SAVE that aims to be more generous than any other.
The negotiators begin their conversation at 10 am Eastern time and it will be livestreamed with a chance for the public to weigh in. Here’s what you need to know:
Biden’s new student debt relief plan5 key takeaways from the first day of public input
Who is on the committee to negotiate a student loan forgiveness rule?
The process the Biden administration has turned to is called negotiated rulemaking. It has been used many times over the years to draft rules related to higher education, including on how Title IX law on sexual assault is applied at schools and colleges and how well colleges produce graduates whose jobs can cover their student debt.
The people who will hash out the student loan plan applied or were nominated to participate and then were selected by the Education Department. They represent different groups who have a stake in student loans, such as borrowers, student loan servicers and colleges and universities. Some of the members include Wisdom Cole, national director of the NAACP Youth & College Division; Yael Shavit, an assistant attorney general in the Consumer Protection Division of the Massachusetts Attorney General’s Office; and Jada Stanford, a student at Stephen F. Austin State University in Texas.
This is a complete list of the committee members, including alternates.
What will happen at the first student loan negotiated rulemaking meeting?
Their meeting agenda doesn’t give very much away. But the focus of the virtual meeting will be wide-reaching, with discussion reserved for each of the five guiding questions mapped out by the department.
The questions are described in this issue paper published late last month. They are, in short:
- Many borrowers have seen their overall balances snowball to amounts larger than they originally took out thanks to the accrual of unpaid interest. Are there ways to help these borrowers and ease their path to repayment?
- How can the department better help borrowers who are eligible for forgiveness under existing programs but haven’t applied? These programs include income-driven repayment, public service loan forgiveness and relief for individuals with total and permanent disabilities.
- What about borrowers whose higher education programs failed to secure them the income needed to pay off their loans? How should the department handle their debt?
- Many borrowers entered repayment before certain benefits were created to ease the student loan debt burden. How should the department handle these loans?
- What kinds of hardships do borrowers face that make it difficult to pay off their student loans? How can the department address those difficulties beyond the options currently in place?
Public comment comes at the end of each day of conversation. To sign up to speak, send your name and, if applicable, organization to negreghearing@ed.gov no later than 12:00 p.m. Eastern time on the day of the meeting.
How does the ‘neg reg’ process for student loan forgiveness work?
The negotiators have to come up with a plan to which each committee member agrees. If they don’t arrive at a consensus, the Education Department will come up with its own proposal. Either way, there will be another opportunity for the public to comment on what is developed before it’s finalized. Congress will then have the opportunity to review the rule, and has the option of passing a joint resolution to overturn it.
A final rule must be published by Nov. 1 for it to go into effect in July of the following year. This rulemaking schedule is a big reason the Biden administration is so intent on publishing a rule developed under its Education Department. If the process goes according to plan, the earliest borrowers would see forgiveness is summer of 2024.
When the Supreme Court struck down Biden’s original plan this past summer, it ruled that student loan debt relief could not happen through the president’s executive authorities the way he’d hoped. That means the only viable routes are through Congressional legislation – which given partisan gridlock is all but impossible – or federal higher education policy changes, a.k.a. neg reg.
If a rule isn’t finalized through this neg reg series and a Republican wins next year’s presidential election, the chances of broad student loan forgiveness becoming reality are even slimmer.
How to watch
First, sign up to watch the negotiators discuss policies that could make large-scale loan forgiveness a reality. You’ll need to register at this link.
The first meeting spans over two days, Tuesday and Wednesday, for five hours each – from 10 am to noon Eastern, then 1 pm to 4 pm.
When are the other student loan relief meetings?
The next meeting is scheduled for Nov. 6-7, and the one after that for Dec. 11-12. Both of the sessions, like the one that kicks off Tuesday, will be virtual and include opportunities for the public to comment.
Biden has a Plan Bfor mass student loan forgiveness. It could be excruciatingly long
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