WASHINGTON – Sen. Chuck Grassley (R-Iowa) today joined Sen. Bill Cassidy (R-La.) and Rep. Virginia Foxx (R-N.C.), the top Republicans on the Senate and House committees handling education, to urge the Biden administration to withdraw its proposal to transfer $147 billion in student loan debt to American taxpayers. 

“In addition to the fiscally irresponsible nature of this backdoor attempt to enact ‘free’ college, the administration continues to use borrowers as political pawns knowing full well these proposed actions are illegal. The Supreme Court has made it abundantly clear that there is zero authority to write-off federal student loans en masse last June when the Department’s ‘Plan A’ was ruled unconstitutional,” the lawmakers wrote.

“Instead of exacerbating the problems of inflated college costs and low-value degrees, we urge you to withdraw this [Notice of Proposed Rule Making] and work with Congress. It is past time that we fix our nation’s broken higher education financing system,” they continued.

This proposal could bring the total amount of student loan debt transferred to taxpayers to over $1 trillion. As ranking member of the Senate Budget Committee, Grassley has warned about fiscal impacts of sweeping student loan forgiveness. For example, had the Supreme Court not struck down the Biden administration’s initial student loan transfer bid, the nation’s deficit would have grown by $300 billion.

Read the full letter and list of 131 signatories HERE.

Background:

The Education Department published its Notice of Proposed Rule Making (NPRM) on April 17, 2024. The proposal states it will assist borrowers facing “hardship.” However, the lawmakers’ letter notes the borrowers who would be eligible for this form of “relief” could make an annual income of up to $300,000. The plan also disregards congressional intent of the Higher Education Act of 1965, the law on which the Education Department is relying to advance its rule. This longstanding statutory language has “no history of broad use by any previous secretary,” the lawmakers underscored today. Legal authorities previously concluded the pathway at issue is less likely to hold up in court compared to the student loan bailout scheme the Supreme Court deemed unconstitutional.

Grassley’s Recent Education Efforts:

Grassley is leading a number of bills to help make higher education more affordable for families. He and Sen. Tina Smith (D-Minn.) introduced a legislative trio to help reduce college costs for generations to come. A Republican package lifts provisions from two of those three bills – his Understanding the True Cost of College Act and Know Before You Owe Federal Student Loan Act – which aim to better financially prepare students for college. 

The Education Department botched the new FAFSA rollout this year, too, prompting setbacks for families and students, as well as high school and college administrators. Grassley is holding the agency accountable for its failure to allow students to apply for or receive federal student aid on time. Specifically, he has voiced strong concerns about ambiguities in Question 22 on the FAFSA. Grassley is pressing officials for clarification and advocating for Iowans at the policymaking tables; if Question 22 requires farm families to list their non-liquid assets, they could lose out on critical student aid. An overview of Grassley’s FAFSA-related pushes follows.

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