Warren Seeks Department of Education Action to Hold Institutions of Higher Education Accountable
Department of Education Has Started the Rulemaking Process on Measures to Reduce Costs for Students and Increase College Accountability
Washington, D.C. – U.S. Senator Elizabeth Warren (D-Mass.) sent a letter to Secretary of Education Miguel Cardona seeking further administrative action from the Department of Education (The Department or ED) to promote accountability among institutions of higher education. The letter was sent in response to the Department’s efforts to transform the income-driven repayment program and identify low financial value programs that saddle students with mountains of debt that they have little hope of repaying.
“I am encouraged by The Department’s attention to the need for stronger accountability among institutions of higher education and the steps that the Department already has taken to hold higher institutions accountable for their actions. However, I believe more must be done,” wrote Senator Warren. “The Department should take every opportunity to utilize the authority Congress has given it to ensure that schools are more accountable to students and taxpayers.”
When President Biden announced his plan to cancel up to $20,000 in federal student loan debt for borrowers, he also announced that ED would reinvigorate efforts to hold institutions of higher education accountable for student outcomes and rising costs. While millions of borrowers wait for the Supreme Court to litigate baseless challenges to the President’s authority to provide necessary student debt relief, the letter urges that ED use its full authority to hold institutions and their executives accountable to students, families, and taxpayers and ensure that students are offered high-quality education and are not saddled with burdensome debts that are unaffordable, relative to their incomes.
Senator Warren recommended specific actions that ED can take to promote stronger accountability, including:
- Ensure that institutions that fall below standards are subject to Provisional Participation Agreements that set out strong corrective conditions with closely supervised, measurable benchmarks for improvement, and that schools that fail to improve see their Title IV funding revoked.
- Strengthen enforcement of for-profit colleges’ manipulation of cohort default rates
- Review college conversions to ensure “covert for-profit” colleges are not redirecting funds to benefit private parties at the expense of students.
- Hold for-profit college owners and executives personally liable when the colleges they run fail and leave students with massive student loan debts.
- Improve oversight of online program management companies and their incentive compensation arrangements with colleges.
- Conduct more stringent oversight of school accreditors, including terminating department recognition of accreditors to protect students and taxpayers if necessary.
- Conduct fair lending risk assessments and ensure all stakeholders in the federal financial aid programs are complying with fair lending and civil rights laws
Senator Warren is leading the fight to hold loan servicers and for-profit colleges accountable to fix the broken student loan system:
- In February 2023, Senator Warren released a new report based on her investigation into how efforts by Republican officials and special interests to block the President’s plan to cancel up to $20,000 in federal student loan debt would affect Americans.
- In October 2022, Senator Warren and U.S. Representative Ayanna Pressley (D-Mass.) visited communities across Massachusetts to celebrate the Biden administration’s student debt cancellation plan and help residents sign up for student loan relief.
- In October 2022, Senator Warren called on the Department of Education to hold for-profit colleges executives accountable for scamming students out of a quality education and loading them up with student debt.
- In September 2022, Senator Warren and Representative Pressley sent a letter to federal student loan servicers to inquire about the steps they are taking to ensure borrowers are receiving timely information about President Biden’s debt cancellation plan.
- In September 2022, Senator Warren sent a letter to the Department of Justice (DOJ) urging DOJ to issue and implement updated student debt bankruptcy guidance without delay following the Biden-Harris administration’s historic decision to cancel up to $20,000 in student debt for up to 43 million borrowers and overhaul the student loan system.
- In August 2022, Senator Warren recognized the Department of Education for protecting students and taxpayers by taking action to revoke ACICS status as an accreditor.
- Senator Warren, along with Senate Democratic Whip Dick Durbin (D-Ill.), Senator Sherrod Brown (D-Ohio), and U.S. Representatives Pramila Jaypal (D-Wash.) and Mark Takano (D-Calif.), urged Secretary of Education Miguel Cardona, urging the Department of Education (ED) to swiftly discharge the loans of borrowers defrauded by predatory for-profit colleges and universities, including those operated by Corinthian College.
- Senator Warren, along with Senate Majority Leader Charles E. Schumer (D-N.Y.) and Representatives Jayapal, Pressley, Ilhan Omar (D-Minn.), and Katie Porter (D-Calif.) led more than 80 colleagues in a bicameral letter to the Department of Education calling for it to release the memo outlining the Biden administration’s legal authority to cancel federal student loan debt and immediately cancel up to $50,000 of debt for Federal student loan borrowers.
- Senator Warren, along with Senate Majority Leader Schumer and Representative Pressley released new analysis showing that resuming student loan payments would strip $85 billion every year from the economy.
- Senator Warren, along with Senators Chris Van Hollen (D-Md.), Blumenthal (D-Conn.), and Smith (D-Minn.), sent letters to four federal loan servicers, requesting information on their plans to support borrowers when student loan payments resume.
- Senator Warren, along with Senators Brown, Blumenthal, Smith, and Van Hollen sent a letter to Maximus, the company that is assuming Navient’s federal student loans servicing contract, questioning its troubling history and seeking assurances that borrowers will receive appropriate services and protections during the transition.
- Senator Warren, along with Senators Brown, Blumenthal, Smith, Van Hollen, Cory A. Booker (D-N.J.), Bernard Sanders (I-Vt.), Tammy Baldwin (D-Wis.), and Edward J. Markey (D-Mass.) sent a letter to the Department of Education urging Secretary Cardona to use his authority to automatically remove all student loan borrowers in default.
- Senator Warren, along with Senators Van Hollen, Blumenthal, Brown, Smith, Markey, and Robert Menendez (D- N.J.) sent letters to the heads of Pennsylvania Higher Education Assistance Agency, Granite State, and Navient calling on them to correct past errors with borrowers’ accounts and address growing concerns over their preparedness to transfer millions of borrowers to new servicers.
- Senator Warren, along with Senator Markey and Representative Pressley, released a report that detailed the ongoing failures of the Public Service Loan Forgiveness program for public servants in Massachusetts.
- At a hearing in July 2021, Senator Warren pushed for borrower protections after a major student loan servicing shakeup.
- In July 2021, Senator Warren released a statement regarding the end of the Pennsylvania Higher Education Assistance Agency's (PHEAA) contract servicing student loans with the Department of Education.
- In June 24, 2021, Senators Warren and John Kennedy (R-La.) called on PHEAA CEO to address concerns about false and misleading statements made during a subcommittee hearing on student loans, which was chaired by Senator Warren.
- In May 2021, Senator Warren led her colleagues in sending a letter requesting information about the steps the Department of Education and the Office of Federal Student Aid (FSA) are taking to help transition millions of federal student loan borrowers back into repayment ahead of the scheduled end to the pause on student loan payments and interest in September.
- In April 2021, Senators Warren and Raphael Warnock (D-Ga.) led a group of colleagues in a letter to Education Secretary Miguel Cardona urging the Department of Education to take swift action to automatically remove all federally-held student loan borrowers from default.
- That same month at her first hearing as chair of the Senate Banking, Housing, and Urban Affairs Committee's Subcommittee on Economic Policy, Senator Warren called out PHEAA for its mismanagement of the Public Student Loan Forgiveness Program.
- Senator Warren also questioned Jack Remondi, CEO of Navient, on the company's long history of abusive and misleading behavior towards borrowers and their profiting off the broken student loan system.
- In March 2021, Senators Warren and Menendez applauded the passage of their Student Loan Tax Relief Act as part of the American Rescue Plan.
- Last Congress, Senator Warren introduced the Consumer Bankruptcy Reform Act and in 2019, co-led the Student Borrower Bankruptcy Relief Act with Senator Durbin (D-Ill.) to make student loans dischargeable through bankruptcy.
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