Following New Report, Courtney Renews Call for Bipartisan Action to Fix the Public Service Loan Forgiveness Program

NORWICH, CT—Today, Congressman Joe Courtney (CT-02) renewed his call for bipartisan action to fix the U.S. Department of Education's Public Service Loan Forgiveness (PSLF) program following a new report that projects problems hampering the program will persist for several more years. A new report from the Student Borrower Protection Center (SBPC) outlines that without serious steps taken by Congress or the Biden Administration, PSLF is likely to continue failing most student loan borrowers working in the public service sector, and that only 20% of applicants will have received student loan relief by 2026. Click here to read the report.

"After a four-year period where the Department of Education didn't just fail to fix PSLF, but actually made it work worse for borrowers, acknowledgement from Secretary Cardona and the Biden Administration that the program needs serious readjustment is a breath of fresh air," said Rep. Courtney. "We've still got serious work to do, however, and reports like this one make that clear. Congress created PSLF to incentivize and thank hard-working Americans for pursuing careers in public service—folks like our teachers, police officers, fire fighters, and servicemembers. PSLF is supposed to be a way to support and retain Americans working in these critical roles, but a twenty percent acceptance rate by 2026 isn't going to fit the bill. If the PHEAA can't get the job done, then the Department needs to find a partner that can—an 80% rejection rate isn't what success looks like. PSLF supports working Americans in every Congressional district in the country, and it's time for my colleagues on the committee to come together from both sides of the aisle, and get serious about delivering real results on PSLF."

Working to Correct the PSLF Program

Rep. Courtney is a senior member of the House Education and Labor Committee, and has worked for years on behalf of American student loan borrowers of all ages to lower the cost of higher education, and to hold unscrupulous loan servicers and for-profit colleges accountable.

Courtney has pressed the Department of Education to fix the PSLF program since a wave of complains first began surfacing in 2018. That year, the U.S. Department of Education (ED) released data showing that an outsized 99% of PSLF applicants had been rejected, many through no fault of their own. In April 2018, Rep. Courtney voted to pass the Consolidated Appropriations Act of 2018, which created the Temporary Expanded Public Service Loan Forgiveness (TEPSLF) program to assist public servants who had previously been denied forgiveness on their student loans.

Despite ED's knowledge that PSLF was not being administered properly, in December 2018, former ED Secretary Betsy DeVos and the Trump Administration issued a memorandum barring student loan servicers from releasing important data to law enforcement officials, hindering the ability of states' Attorneys General and agencies like the Consumer Financial Protection Bureau (CFPB) to maintain oversight of loan servicers who might be engaged in unscrupulous practices. Only a few weeks later, in May 2019, a report from the Office of the Inspector General (OIG) found that 61% of loan servicers were non-compliant with ED standards.

Rep. Courtney questioned former Secretary DeVos on her Department's efforts to undermine protections for student loan borrowers when she came before the House Education and Labor Committee for a hearing in April 2019. He stated in part: "Brazenly, the Department did not even publicly notice this [memorandum], and it was only obtained because someone at the Department leaked it. So, I want to ask, […] what is the rationale for the Department to shut off that flow of information regarding student loan servicers, which has been standard operating procedure for decades? This is a decision you made—to shut off this information to people who are law enforcement. They're investigating things like fraud. So please explain the decision in that memo."Click here to read more.

This year, Courtney has welcomed Secretary Miguel Cardona and the Biden Administration's commitment to righting the ship on PSLF. On August 11^th, Secretary Cardona announced that his Department would restore the government's ability to conduct oversight of loan servicers on behalf of borrowers within their jurisdictions—the oversight that Secretary DeVos did away with.

On August 24^th, the Biden Administration also announced a policy under which they'll presumptively grant full student loan relief to borrowers the Department determines were defrauded by their colleges—a departure from the previous administration's policy. Under former Secretary DeVos, students who could prove they were defrauded were only ever entitled to receive partial relief. Instead, the Department of Education under Secretary Cardona will assume that defrauded student borrowers are entitled to 100% relief, unless evidence is presented to the contrary.

Rep. Courtney has also worked this year extend the full benefit of PSLF to everyone who ought to receive it—particularly servicemembers. Existing rules prevent many active duty servicemembers who have deployed from applying their full period of deployed service towards PSLF, meaning that they're made to complete a longer period of service before qualifying for student loan forgiveness. Rep. Courtney introduced the bipartisan Recognizing Military Service in PSLF Act (H.R. 3486), a bill that would finally enable American service members to count the full length of their service towards PSLF. Last week, his bill was officially included in the Education & Labor Committee's portion of the Build Back Better Act.

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