Titus Statement on Biden Administration's Student Loan Forgiveness Announcement

Statement

Today Congresswoman Dina Titus (NV-01) issued the following statement regarding President Biden's announcement forgiving up to $10,000 in debt cancellation for non-Pell Grant recipients with loans held by the Department of Education, and up to $20,000 in debt cancellation for Pell Grant recipients. The President also extended the pause on federal student loan repayment one final time through December 31, 2022.

"As a professor at the University of Nevada, Las Vegas for 35 years, I had the privilege of teaching some of the best and brightest in our state. Far too often, however, I witnessed promising students left with no choice but to drop out of school and abandon their educational and career goals because of financial hardships.

"At the start of the pandemic, the Biden Administration acted immediately to pause student loan payments to help struggling borrowers make ends meet. Today's announcement goes one step further in making higher education more accessible for everyone, especially women and people of color who are disproportionately harmed.

"Making higher education more affordable is not only an investment in generations to come. It is also an investment in our economic viability, workforce, and leadership on the global stage.

"I will continue to fight in Congress to ensure that students don't have to choose between their educational aspirations and financial realities."

Background

Since 1980, the total cost of both four-year public and four-year private colleges has nearly tripled, even after accounting for inflation. Today approximately 43 million Americans have federal student loan debt, totaling $1.6 trillion in outstanding debt nationally. Nevada residents are burdened by $11.8 billion in student debt.

Democrats have led the charge to support students throughout the pandemic and to expand higher education opportunities to those who have long been left behind. The American Rescue Plan invested nearly $40 billion in colleges and universities, with substantial funding specifically for Minority Serving Institutions, to keep down costs and deliver direct assistance to students. In this year's government funding package, Democrats secured a $400 increase in the maximum Pell Grant. And the historic CHIPS and Science Act widens the pathway to STEM education for students across the country.

Today's announcement will:

Provide targeted debt relief to address the financial harms of the pandemic. The Department of Education will provide up to $10,000 in debt cancellation for non-Pell Grant recipients with loans held by the Department of Education, and up to $20,000 in debt cancellation for Pell Grant recipients. Borrowers are eligible for this relief if their individual income is less than $125,000, or $250,000 for households. No high-income individual or high-income household -- in the top 5% of incomes -- will benefit from this action. To ensure a smooth transition to repayment and prevent unnecessary defaults, the pause on federal student loan repayment will be extended one final time through December 31, 2022. Borrowers should expect to resume payment in January 2023.

Make the student loan system more manageable for current and future borrowers by:

Cutting monthly payments in half for undergraduate loans. The Department of Education is proposing a new income-driven repayment plan that protects more low-income borrowers from making any payments and caps monthly payments for undergraduate loans at 5% of a borrower's discretionary income--half of the rate that borrowers must pay now under most existing plans. This means that the average annual student loan payment will be lowered by more than $1,000 for both current and future borrowers.

Fixing the broken Public Service Loan Forgiveness (PSLF) program by proposing a rule that borrowers who have worked at a nonprofit, in the military, or in federal, state, tribal, or local government, receive appropriate credit toward loan forgiveness. These improvements will build on temporary changes the Department of Education has already made to PSLF, under which more than 175,000 public servants have already had more than $10 billion in loan forgiveness approved.

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