August 29, 2019
ATTORNEY GENERAL RAOUL DEMANDS INFORMATION TO ADDRESS CONTINUED DEFICIENCES WITH THE PUBLIC SERVICE LOAN FORGIVENESS PROGRAM
Chicago — Attorney General Kwame Raoul, as part of a coalition of 12 attorneys general, urged the U.S. Department of Education to provide information to address ongoing problems with the Public Service Loan Forgiveness (PSLF) program. The PSLF program was created in 2007 to help student loan borrowers by allowing borrowers who enter public service to seek to have their federal student loan debt discharged after the equivalent of 10 years of payments.
In a letter issued to Department of Education Secretary Betsy DeVos, Raoul and California Attorney General Xavier Becerra led the coalition in demanding additional data to help states address ongoing problems with the PSLF program. According to the coalition, the publicly-available data Secretary DeVos has provided does little to provide a full accounting of the current situation for borrowers relying on PSLF.
“The Public Service Loan Forgiveness program has been nothing but an empty promise for close to 99 percent of student loan borrowers,” Raoul said. “College graduates who gave 10 years of service deserve to have the U.S. Department of Education hold up its end of the bargain and grant them the student loan forgiveness they were promised. I urge the Department to right their wrongs and provide the information needed to address the ongoing problems with the PSLF program.”
In October 2018, the Illinois Attorney General’s office, with the offices of 11 other attorneys general, issued a letter to the Department of Education expressing concerns about the implementation of PSLF. The coalition also requested data to explain why the program had less than a 1 percent approval rate. At that time, the attorneys general requested that the Department provide information about the program and urged the Department to take immediate action to reform the program. More than nine months later, in July, the Department provided incomplete information that was not fully responsive to the states’ request.
Data provided by the Department of Education indicates that as of March 31 of this year, only 864 of 76,002 applications for PSLF have been approved. Further, that data indicates that of 12,429 applications to the Temporary Expanded PSLF program, which was implemented to provide additional relief to qualifying consumers whose initial PSLF applications were rejected, only 442 have been approved. The data shows that tens of thousands of borrowers have been denied, which is especially troubling in light of a March report by the Department’s Office of Inspector General that found widespread servicer noncompliance with federal loan servicing requirements. For those reasons, the coalition is requesting better data in order to examine the scope and source of the problems and to assist borrowers.
In the letter, the coalition expresses concerns about the ongoing mismanagement of the PSLF program, noting that borrowers may be forced to choose between public service careers and being able to repay their student loans.
Joining Raoul and Becerra in sending the letter are the attorneys general of Connecticut, the District of Columbia, Iowa, Kentucky, Maryland, New Jersey, New York, Oregon, Pennsylvania and Washington.