Al Drago/CQ Roll Call
- The Biden administration announced new regulations to improve income-driven repayment plans.
- Republicans are already pushing back, saying the new regulations further burden taxpayers.
- Broad forgiveness is still in limbo, and headed to the Supreme Court on February 28.
As student loan relief hangs in court limbo, the Biden administration is moving ahead on making monthly payments cheaper for some borrowers — and it’s already attracted ire from the right.
On Tuesday, the Education Department officially released its new regulations for income-driven repayment (IDR) plans. The changes are meant to make payments cheaper, and “create faster pathways to forgiveness,” according to Education Secretary Miguel Cardona.
But Rep. Virginia Foxx, who now chairs the House Education and Workforce Committee, said that the announcement is “a repeat of the same playbook that got us into this college affordability crises in the first place.” Foxx has been an outspoken opponent of Biden’s broad student loan forgiveness and other pandemic-era debt-relief measures.
“Because President Biden couldn’t get his radical free college agenda through Congress, he has resorted to doing it through the backdoor by executive fiat,” Foxx said in a statement. “Expansions of already generous repayment options, institutional shame lists, and other failed policies of the past won’t lower the cost of college for students and families. It does, however, turn the federal loan program into an untargeted grant with complete disregard for the taxpayers that fund it.”
Arkansas Sen. Tom Cotton also took to Twitter to criticize the plan, saying that Biden’s “proposed changes encourage students to take out as much debt as possible because the taxpayers pick up the tab. This is the opposite of the message we should be sending young Americans.”
—Tom Cotton (@TomCottonAR) January 10, 2023
Under IDR, borrowers are meant to make monthly payments based on their incomes, with eventual loan forgiveness after at least 20 years of payments. But, as Insider reported, those plans currently have deep flaws, prompting the push for refreshed regulations. The National Consumer Law Center found that just 32 borrowers ever have qualified for full forgiveness under IDR.
The new proposed regulations to IDR plans that Biden announced on Tuesday would cut monthly payments for undergraduates in half and give borrowers in default a chance to access the repayment plans, among other things. The reforms will enter a 30-day public comment period, and senior administration officials told reporters on Monday that the Education Department plans to implement them by mid-2023.
Amid GOP criticism, Democratic lawmakers have lauded the reforms.
“The Biden administration’s proposed rules for higher education are big structural changes to lower costs for working people and hold colleges accountable,” Massachusetts Sen. Elizabeth Warren wrote on Twitter on Tuesday. “These plans will significantly cut monthly loan payments and it’s part of a real transformation of the student loan system.”
As administration officials noted, it plans to implement not only those changes to IDR, but also Biden’s plan to cancel up to $20,000 in student debt this year — which is headed to the Supreme Court on February 28.