July 18, 2023
The U.S. Department of Education on Tuesday kicked off President Joe Biden’s second attempt at canceling massive amounts of student loan debt, though the new process will take months and potentially years.
Education Department officials hosted a virtual hearing Tuesday, the start of complex regulatory procedures the Biden administration will use to try to wipe away student loans. The inaugural session gave pundits and members of the public, both in favor of and against cancellation, a chance to air their thoughts.
The White House is building a regulation through the Higher Education Act, the main vehicle for federal postsecondary ed policy and a different law than the one it used to justify cancellation in the first forgiveness plan that the U.S. Supreme Court struck down last month.
Biden took immediate action after the Supreme Court ruled against his initial loan forgiveness plan, which would have forgiven up to $20,000 for borrowers earning less than $125,000 a year. The same day the high court handed down its decision, Biden said he would pursue a regulation to cancel loan debt.
The Education Department now is embarking on that plan, which starts with a process called negotiated rulemaking.
Neg reg, as it’s known, brings various parties to the table that would be affected by regulatory change — in this case, they’ll discuss Title IV financial aid programs.
But that can take quite a while, partially because those parties, whom the Education Department names, have to unanimously agree on policy decisions. If they do not, the Education Department can in essence take over and write a draft regulation as it sees fit.