The U.S. Education Department agreed to hold another rule-making meeting over its proposal for an alternative student-debt relief plan after pressure from Democratic lawmakers and influential advocacy groups.
The agency will hold virtual sessions to address the issue on Feb. 22 and 23, following its decision in December to end the regulatory process on the proposed rule.
Advocates had expressed frustration the department did not include “hardship” as a qualifier for targeted debt relief in its draft proposal. That technical change would extend relief to more low-income borrowers and people of color, according to those seeking the change. The department committed to release suggested language for a hardship rule at least a week before the meetings.
“We look forward to discussing another avenue for borrower relief related to hardship at our next negotiation session,” Under Secretary of Education James Kvaal said in a statement Wednesday.
President Joe Biden has sought to enact a “Plan B” to provide relief to student-loan borrowers after his initial program, which would have forgiven billions of dollars in debt, was struck down by the U.S. Supreme Court. Biden campaigned in 2020 on offering broad debt relief and the issue resonates with Black and young voters, whose support will be crucial to his reelection hopes in November.
The White House has canceled over $136 billion in debt for more than 3.7 million borrowers, according to the Education Department, mostly through changes to existing programs, but many of the president’s allies have pushed for more expansive assistance.
A letter earlier this month from nearly 70 advocacy groups, including labor unions and civil-rights organizations, pushed Education Secretary Miguel Cardona to hold another meeting to hear their concerns. Senate Majority Leader Chuck Schumer and Massachusetts Senator Elizabeth Warren were among more than two dozen members of Congress who also called for another discussion.
“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,” the lawmakers wrote in a letter to Cardona.
The draft proposal intended to offer relief to borrowers in specific groups, such as individuals with balances exceeding their original principal debt or those who are eligible for relief under an existing program but have not enrolled.
The term “hardship” is drawn from the Higher Education Act, the law that gives the Education secretary broad powers to waive federal student debts and that the agency is using as a legal basis to pursue more expansive forgiveness.
The administration nonetheless faces significant obstacles in crafting rule that will stand up in court, after attempting to offer relief to a wide-swath of borrowers led the high court to strike down its first program.
This article was provided by Bloomberg News.