The pressure keeps building on President Joe Biden’s Education Department to include as many student-loan borrowers as possible in its second debt relief plan.
On Tuesday night, 13 of the negotiators on the committee to help craft Biden’s new relief urged Education Secretary Miguel Cardona to add an additional negotiation session to discuss including borrowers with financial hardship in the plan.
After the Supreme Court struck down Biden’s first attempt at broad debt cancellation, the Education Department announced it would be pursuing a new route for relief using the Higher Education Act of 1965. That law requires the administration to hold a series of negotiation sessions with stakeholders, along with ensuring opportunities for public comment.
The department concluded its third — and what it planned to be the final — negotiation session in December, and it proposed five categories of borrowers to be prioritized for relief through the new plan. However, it did not include a category for borrowers with financial hardship, and some of the negotiators are requesting an additional session to discuss that topic.
“Throughout our negotiations, we brought to the Department’s attention many situations in which borrowers face hardship warranting debt relief, including borrowers who have disabilities, are elderly, are in default, have high debt to income ratios, filed bankruptcy, have no degree, have extremely old loans, are incarcerated, and have undue interest exceeding original principal,” the negotiators wrote in the letter.
“As we repeatedly stated in the negotiations, we think that regulations that allow the Secretary to provide debt relief based on borrowers’ financial hardship are a critical part of any debt cancellation agenda,” they wrote.
The Education Department has not yet commented on whether it will add an additional session. But with student-loan payments having resumed in October after an over three-year pause, some advocates and Democratic lawmakers expressed concern that borrowers are struggling with the extra monthly bill — and they’re urging the department to take every opportunity to get debt relief to as many borrowers as possible.
“While we appreciate the efforts of the Department and the negotiating committee, we are concerned that, without full consideration of cancellation targeted toward borrowers facing financial hardship, the rule will not provide adequate debt relief for the most vulnerable borrowers,” a group of Democratic lawmakers wrote last week.
After the department announces whether it has concluded negotiations, it will publish the proposed text for the relief on the Federal Register with the opportunity for the public to comment on the proposal before final implementation.