Mark Up of Ed Bills Hits a Wall

By The New England Council

DC Shuttle …

Senate Panel Cancels Education Funding Bill Markup. The Senate Appropriations Committee canceled a scheduled markup of legislation to fund the U.S. Education Department for the 2020 fiscal year. A vote on Health and Human Services (HHS)-Labor-Education has been a major priority for Democrats, but is now facing partisan controversy as Congress returns from recess. The top Democrat on the Appropriations subcommittee, Sen. Patty Murray (D-WA) announced that she would be introducing an amendment to the fiscal 2020 funding bill for the Department of Health and Human Services that would bar the Trump administration from implementing its Title X family planning rule. In response, Senate Appropriations Chair Richard Shelby (R-AL) immediately canceled the subcommittee markup for the measure and then canceled the full committee markup. Shelby commented on the cancellations stating, “Unfortunately, the threat of poison pill amendments delayed [Labor-HHS-Education’s] consideration because they would have prevented Senate passage and drawn the President’s veto … Such poison pills are expressly prohibited by the terms of the budget deal, which were agreed to by the President and Congressional leaders on both sides.” Murray responded to the markup cancellation stating, “Title X always had strong bipartisan support, so I’m unclear why they fear voting on it now.” Republicans believe Democrats are aiming to violate their “handshake” budget agreement signed by President Trump before the August recess. Democrats do not believe “poison pills” to be the budget agreement problem, with Senate Minority Leader Chuck Schumer (D-NY) stating that Republicans want to increase funding for President Trump’s wall by $12 billion, taking nearly $5 billion from domestic programs. Such disagreements have reinforced the likelihood that a stopgap spending bill may be necessary as House and Senate leaders are facing another government shutdown at the end of the fiscal year, September 30. Read more in The Hill and Politico.

House Financial Services Committee Holds Student Loan Hearing. The House Financial Services Committee held a hearing to address the growing national student loan debt crisis. The hearing included the testimonies of various advocates and experts including executive director of the Student Borrower Protection Center Seth Frotman, staff attorney for the National Consumer Law Center Persis Yu, actor and student debt activist Hassan Minhaj, and resident fellow at the American Enterprise Institute Jason Delisle. The four-hour hearing was the first time the full House Financial Services Committee has taken up the issue in nearly 20 years. Rep. Alexandria Ocasio-Cortez (D-NY) included in her opening remarks that over 45 million Americans have student loans totaling nearly $1.5 trillion in debt, 92% of which is owed to the federal government. Several of the companies which the U.S. contracts with to handle the debt collection, such as Nelnet and Navient, came under further scrutiny in many of the testimonies. Both Democrats and Republicans on the House Committee agree that there are systemic problems within the student loan industry and Chair Maxine Waters (D-CA) said the committee members are discussing a series of bills to address those issues. Read more in The Hill and NBC News.

Education Department Shares State Law Enforcement Requests for Student Loan Data. The Education Department confirmed to Congress that it has stopped turning over student loan information to state law enforcement agencies, who are investigating federally contracted student loan companies for illegally exploiting borrowers. The department believes that the state laws the enforcement agencies are operating under are preempted by federal laws and that it is exclusively the Education Department’s responsibility to oversee the nine servicers currently handling federal student loans. Top advisor to U.S. Education Secretary Betsy DeVos, Diane Auer Jones, wrote a letter to Sen. Murray and Rep. Rosa DeLauro (D-CT) on June 24 stating that the Department of Education “no longer grant such requests for nonconsensual disclosure of records from entities purporting to exercise regulatory or enforcement power.” The letter claims that the majority of the requests, of which there have been 40 as of June 12, involve information requests often in the context of alleged identity theft, rather than investigations into a student loan company. Jones said the department is continuing to share student loan information with law enforcement but is often prevented from doing so as they must first determine whether to release records by “seeking to balance a borrower’s interest in privacy with the need for the record.” Murray released a statement in response to the letter stating, “After nearly a year of hiding the truth, Secretary DeVos’ Department of Education finally admitted that it is interfering with law enforcement in order to protect predatory student loan servicers and debt collectors instead of making sure student loan borrowers get treated fairly.” In recent months, several states including California, Illinois, New York and Maryland, have adopted laws to force loan servicers to comply with state consumer protection. The department maintains that under the Privacy Act of 1974, it has the discretion of releasing student loan data shared by its contractors and that a “state-by-state approach to regulating federal assets causes confusion for borrowers and makes administration of the loan program more complicated and costly.” Read more in NBC News.

Education Department Finalizes Student Borrower Protections Regulations. The Education Department handed down its final student borrower defense rules. The rules will replace the 2016 Obama administration rules, which implemented a regulatory crackdown on for-profit colleges causing the closure of several of them and leaving tens of thousands of students with debt and no degree. One of the major rule changes was a new three-year limit, versus the 2016 rule six-year limit, from when a borrower graduated or left school on filing defense to repayment claims. In addition, each claim must now be individually reviewed, eliminating the group discharge process. Students are also required to go to further lengths to show how their college’s misrepresentation caused them financial harm and left them unemployable. “We believe this final rule corrects the wrongs of 2016 rule through common sense and carefully crafted reforms that hold colleges and universities accountable and treat students and taxpayers fairly,” stated DeVos. The department’s press release emphasizes that the new rules is expected to save taxpayers $11.1 billion from 2020 to 2029. While the new rules did not include the highly controversial proposal that borrowers must default on their loans before becoming eligible to apply for relief, there are still many critics who object to the rules. Many claim that not only do the new rules reduce the number of students who will have a viable chance for relief, but also curtails the number of students who will apply at all. Read more in Education Dive.

“Pell Grant Restoration Act” Introduced in the House. U.S. Reps. Jahana Hayes (D-CT), Mary Gay Scanlon (D-PA) and Lucy McBath (D-GA) introduced the Pell Grant Restoration Act. The legislation would amend Title IV of the Higher Education Act to restore Pell Grant eligibility for “any period of time during which they would have qualified for loan forgiveness due to school closure or institutional fraud or misconduct.” Under federal law, students are entitled to 12 semesters of Pell Grant eligibility, but when students use their grants to attend a deceitful for-profit college, they often find themselves deep in debt and without an employable degree and without the financial aid needed to seek out further education, Hayes explains in her press release. A companion measure to this bill was introduced in the Senate by Sen. Elizabeth Warren (D-MA). “Students who get cheated by a predatory, for-profit college should not lose their Pell Grant eligibility,” said Warren. “I’m glad to reintroduce this bill with Representatives Hayes, Scanlon and McBath because our government should not be punishing students for getting scammed.”

We publish the DC Shuttle each week featuring higher ed news from Washington collected by the New England Council, of which NEBHE is a member. This edition is drawn from the Higher Education Update in the Council’s Weekly Washington Report of Sept. 16, 2019. For more information, please visit: www.newenglandcouncil.com.

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