NASFAA Virtual Conference Highlight: Kvaal Outlines ED’s Agenda Following SCOTUS Rulings and Details Upcoming Regulatory Framework

By Hugh T. Ferguson, NASFAA Senior Staff Reporter

The Department of Education's (ED) top higher education official, Under Secretary James Kvaal, on Tuesday gave the keynote address at NASFAA’s 2023 Virtual Conference, giving a glimpse into the department’s latest actions that will directly impact financial aid offices in the months ahead.

“Being a financial aid administrator is a tough job and requires a lot of expertise, and requires a lot of compassion,” Kvaal said. “I know that what we do at the Department of Education to make it possible for many more people to get college degrees wouldn't be possible without the work that you all are doing every day. And these days, I know that you are doing a lot more with less.”

NASFAA President and CEO Justin Draeger joined Kvaal for a wide-ranging conversation that dug into the United States Supreme Court’s most recent decisions that blocked the administration's debt cancellation program and struck down race-conscious admissions policies.

On the issue of race-conscious admissions, Kvaal slammed the court’s ruling as a move that “rolled back decades of progress” and would make college diversity efforts more challenging.

“But as president Biden said, while the court can render a decision, it can't change what America stands for. So let's not be discouraged or disillusioned by this decision — there's still a lot of good work for us to do,” Kvaal said. “Let's take this moment to renew our commitment to opportunity and bring new urgency to the work of building a better country.”

Kvaal also said that in the coming weeks ED will work with the Department of Justice (DOJ) on new guidance detailing how colleges can consider race in admissions policies and provide a path forward to creating a more inclusive higher education system.

The goal for ED is to release its guidance within 45 days of the court's decision, or mid-August. Kvaal stressed that it was important for all institutions to “catch our breath” in order to understand the scope of the decision.

Draeger then turned the conversation to the student loan portfolio and asked Kvaal to provide some clarity on the status of the student loan repayment landscape.

Kvaal confirmed that interest on student loans will begin accruing September 1, borrowers’ first payments will be due sometime in October, and that there will be a 12-month on-ramp to repayment, during which time interest will accrue, but the adverse consequences associated with delinquency will be suspended.

At the same time, ED will seek to carry out the administration’s debt cancellation plans through the negotiated rulemaking process.

Kvaal said that ED will simultaneously pursue other changes to the student loan system, through accountability regulations and updated repayment plans.

“We can't go back to the broken system we had before the pandemic, where more than a million borrowers defaulted each year,” Kvaal said. “We need to be able to say to students that federal loans are a smart investment in your future, not a risky one.” 

Kvaal also said that ED is working with student loan servicers and is outlining a clear path ahead to communicate to borrowers that the repayment process will resume.

“Our advice to borrowers is to take advantage of whatever benefits are available to them, but you do need to make payments,” Kvaal said.

The conversation also turned to FAFSA simplification implementation, which Kvaal said would be just as important as the return to repayment and that ED was committed to a December release date for the 2024-25 FAFSA.

“The FAFSA for us means replacing systems that were almost 50 years old,,” Kvaal said. “It is very complex for us and I know it’s very complex for colleges. Software vendors need to change their software, we have a new formula that we all need to understand, new terminology, we need to explain to students and parents. It's a very high focus for all of us, and we are committed to that date in December. We understand how challenging it would be for all of our partners at colleges and universities and states, high schools, parents and students, if that date were to slip further.”

 

Publication Date: 7/12/2023


Peter G | 7/12/2023 6:56:44 PM

"And these days, I know that you are doing a lot more with less."

So he's on board with paring down the GE/Certification bundle as well as FWS reporting? Excellent.

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