Letter to the Hon. Betsy DeVos, Secretary of Education - Don't Break Promise to Veterans Exploited by For-Profit Colleges

Letter

Dear Secretary DeVos:

We are writing today to request data regarding the Department of Education's (the "Department") progress in providing relief to Nevada students who were previously enrolled in failed colleges and universities. This request is particularly urgent given that these failed institutions frequently recruited Nevada veterans.

To summarize, students have two paths for relief available under the law: "Closed School Discharges" and "Borrower Defense to Repayment." Closed School Discharges are only available to those students who were either enrolled at the time their schools closed, or who withdrew within 120 days of the school's closure. Borrower Defense to Repayment is a decades-old regulation that provides that students are entitled to discharges of their Federal student loans if their school misled them or treated them unfairly. This letter seeks information on both avenues for relief available to students.

Recently, several schools that engaged in misleading and unfair practices collapsed under the weight of various investigations. The resulting failures have left students in Nevada desperate for relief from large debt burdens that prevent them from buying homes or cars, finding apartments or jobs, and otherwise moving on with their lives.

Data provided to our offices suggests that as of January 2017, there were 784 Borrower Defense to Repayment applications from Nevada students still pending. However, the public has no view into which schools these students attended, nor whether their discharge requests have actually been processed. This statistic likely undercounts the number of Nevadans currently awaiting relief, as many more students may have applied for debt discharges since January 2017.

What's more, there are at least 1,300 Nevada students that are eligible for Borrower Defense to Repayment claims that never applied for relief, likely because they are unaware it is available. Though Nevada Attorney General Laxalt has undertaken a public awareness campaign to alert these borrowers of the rights available to them under the law, we have a very limited view into whether these borrowers have actually applied to the Department for relief, or whether the Department has processed their applications.

In addition to Borrower Defense to Repayment claims (which are available to wider groups of students that attended schools in which unfair or deceptive acts and practices were documented), students who were enrolled at a school when it closed, or who withdrew from it within 120 days of the school closing, are eligible for a Closed School Discharge. Though available to a narrower set of borrowers, these discharges are meant to be streamlined. The public also lacks data on the number of Closed School Discharges received by residents of Nevada. There are three major college franchises with presences in Nevada that have closed in recent years: Corinthian Colleges, Inc. ("Corinthian"), ITT Education Services, Inc. ("ITT"), and Marinello Schools of Beauty. Likewise, we are requesting Closed School Discharge information related to these campuses, and any other campus that may have closed in the recent past.

In summary, in order to better understand how the Department is serving harmed borrowers in the State of Nevada, we ask that you provide our offices with the following information:

The total number of students in Nevada that are eligible for a Borrower Defense to Repayment discharge to date, disaggregated by school;

The total number of students in Nevada that have applied for a Borrower Defense to Repayment discharge to date, disaggregated by school;

The total number of students in Nevada that have been granted a Borrower Defense to Repayment discharge to date, disaggregated by school;

The total number of former Corinthian students in Nevada that are eligible for a Borrower Defense to Repayment discharge using the streamlined Attestation Form;

The total number of former Corinthian students in Nevada that have applied for a Borrower Defense to Repayment discharge using the Attestation Form referenced in (d), above;

A breakdown of the number of Corinthian Attestation Form applications from students in Nevada related to Borrower Defense that have been accepted and rejected, along with summary information describing the rationale for any rejections;

The total number of students in Nevada that were eligible for a Closed School Discharge from 2008 to the present, disaggregated by school;

The total number of students in Nevada that have been granted a Closed School Discharge from 2008 to the present, disaggregated by school; and

The number of veteran students qualifying under each of (a) through (h).

Nevada students that work hard to prepare themselves for a 21st Century workforce shouldn't be burdened with debt from institutions that misrepresent themselves, and veterans seeking to bolster their education and enter the civilian workforce should be made whole. We request the data outlined herein in order to better understand whether Nevadans are being afforded the rights conferred to them under the Higher Education Act, and we look forward to working with the Department on our shared goals of advancing the skills and job-readiness of students.

Source