Cassidy, Foxx Question ED After Income-Driven Repayment Fixes, Loan Discharges

By Maria Carrasco, NASFAA Staff Reporter

After the Department of Education (ED) began discharging $39 billion in federal student loan debt due to “fixes” to the income-driven repayment (IDR) loan program, two top Republican lawmakers are asking ED to provide more information on its process of forgiving the debt.

Specifically, Sen. Bill Cassidy (R-La.), ranking member of the Senate Committee on Health, Education, Labor, and Pensions (HELP), and Rep. Virginia Foxx (R-N.C.), chair of the House Committee on Education and the Workforce, sent a letter to Education Secretary Miguel Cardona with multiple questions on ED’s authority to implement this forgiveness and how much the forgiveness will cost. 

“The Department has not shared what statutory authority it is using either to justify this expenditure of taxpayer dollars or the expansive interpretation of the law that led to the fixes,” the two lawmakers wrote. 

In April 2022, ED first announced that it would perform this one-time adjustment to count some borrowers’ accounts in long-term forbearances toward forgiveness under the IDR and Public Service Loan Forgiveness (PSLF) programs. ED announced this one-time adjustment at the same time the Government Accountability Office (GAO) released a report highlighting issues with the IDR program.

In July this year, ED announced that it would forgive $39 billion in federal student loan debt to 804,000 eligible borrowers as a result of the one-time adjustment. Though the forgiveness has faced legal challenges, ED began discharging eligible borrowers’ student loans on August 14. 

Cassidy and Foxx pointed to the GAO report, which found that there were 7,700 loans held by 3,000 borrowers enrolled in IDR plans. Those loans had a repayment status for 20 to 25 years “without a clear explanation” of the number of qualifying payments made as of September 1, 2020, according to the lawmakers. Additionally, the lawmakers noted the GAO report identified 62,600 loans that had been in repayment to be possibly forgiven, but those loans had insufficient qualifying payments.

“The numbers identified in the GAO report could not account for the $39 billion in loan discharges for 804,000 individuals the Department touted in July,” the lawmakers wrote. 

Cassidy and Foxx asked over a dozen questions, including what statutory authority ED has to discharge these borrowers’ loans, what methodology ED used to select the 804,000 borrowers, and the total dollar amount of loans ED expects to discharge in the future from this policy, among other questions. The lawmakers asked Cardona  to answer their questions by the end of September.


Publication Date: 9/8/2023

Lilia T | 9/8/2023 4:20:28 PM


James C | 9/8/2023 8:32:55 AM

September has 31 days now?

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