WASHINGTON — Virginia Democrats are leading efforts in Congress to stop the mass denial of student debt relief to millions of teachers, nurses, first responders and other public servants.
They’re pressing the Trump administration to fix the problem, while the Education Department is blaming Congress for a loan forgiveness program that rejects the vast majority of applicants.
The department’s mismanagement of a temporary expansion of the loan program has created “a disaster” for applicants, Virginia Sen. Tim Kaine and other Democrats wrote in a recent letter to Education Secretary Betsy DeVos.
The Trump administration has “left public servants in the lurch again,” Kaine said in a statement. “It’s outrageous that they still can’t get this right.”
The outrage comes in response to a September report by the Government Accountability Office (GAO) — Congress’ legislative arm — that found that 99 percent of program applicants have been rejected, including 570 of 585 from Virginia.
And of $700 million set aside for the program, only $27 million has been spent, the report found.
Rep. Bobby Scott, D-3rd, — chairman of the House Committee on Education and Labor — released a report last week alleging that the department “ignored early warnings from internal staff” that could have prevented the program’s “disastrous implementation.”
And Rep. Gerry Connolly, D-11th, chairman of the House Oversight and Reform Subcommittee on Government Operations, sent a recent letter to DeVos demanding an explanation for the program’s high rejection rate. Virginia Democratic Reps. Jennifer Wexton, Abigail Spanberger and other lawmakers signed on.
“This is about sending a clear message to the Department of Education,” Connolly said.
The Department of Education isn’t bowing down just yet.
The department has taken steps to improve internal processes and help borrowers understand complex eligibility requirements and other program-related information, spokesperson Angela Morabito said in a statement.
But she turned blame on Congress, saying lawmakers created the complicated program knowing full well that only a “tiny fraction” of borrowers would qualify.
“The high denial rates … are by congressional design, not by accident or failed implementation by the department.”
Morabito declined to comment on a news report that the administration — which has sought to eliminate funding for the program in recent years — blocked the federal government’s consumer protection agency from trying to fix the program.
Wexton pressed the director of the agency, Kathy Kraninger, about the issue at a House hearing Wednesday.
Far short of expectations
First enacted in 2007 under President George W. Bush, the Public Service Loan Forgiveness (PSLF) program was intended to encourage more people to pursue careers in public service by promising loan forgiveness after 10 years — or 120 months — of on-time payments under a qualifying plan.
The first cohort of borrowers applied for debt forgiveness in 2017, but the program’s promise fell far short of expectations. Nearly all applicants — about 99 percent — were rejected.
The Department of Education explained at the time that applicants were denied because they didn’t meet strict program requirements, such as having eligible loans, qualifying employment, or the right number of payments, or didn’t provide complete information on the application form.
In 2018, Congress passed legislation to temporarily expand eligibility for the program. But the program’s high rejection rate persists, thanks in part to confusion among borrowers and lack of access to program information, according to the September GAO report. Of nearly 54,000 requests for loan forgiveness, only 661 — or 1 percent — were approved.
In its report, the GAO urged the Department of Education to make more information available and streamline the application process to reduce confusion.
The Education Department agreed with the report’s recommendations but lawmakers aren’t happy with their progress.
“The department’s failure to implement this program is mystifying and unacceptable,” Scott said in a statement. “Regardless of whether the administration supports the PSLF program, the Constitution requires the executive branch to ‘take care that the laws be faithfully executed.’”
Kaine called on appropriators to direct the Education Department to implement the GAO’s recommendations and said he will keep the pressure on DeVos to fix the program.
A member of the Senate Health, Education, Labor and Pensions Committee, he also co-sponsored legislation that would expand eligibility for the program and ensure that public servants can count on repayment when they apply for loan forgiveness.
The state’s other U.S. senator — Democrat Mark Warner — has signed on in support.
Democrats have introduced a similar bill in the House, where the issue has been the subject of recent hearings.
Democratic Virginia Reps. Connolly, Spanberger, Wexton and Don Beyer support the bill, spokespeople said.
None of the four U.S. House Republicans from Virginia have signed on to the bill, and their spokespeople did not respond to requests for comment.
Legislation dealing with the loan forgiveness program isn’t expected to become law anytime soon in a sharply divided Congress consumed with impeachment, the appropriations process and other pressing issues.