Full Audit of PSLF Program Needed to Ensure Justice for Workers Denied Promised Relief
April 12, 2021: Washington, D.C. — Today, 97 student, consumer, public interest, civil rights, higher education, public health, workforce, professional, military, and faith organizations representing millions of public service workers and student loan borrowers sent a letter to United States Secretary of Education Miguel Cardona calling on the Department of Education (ED) to conduct an immediate 90 day review of the Public Service Loan Forgiveness (PSLF) program and cancel the student loan debt of all public service workers who have completed ten or more years of service. The letter urges ED to use the full scope of its legal authority, including emergency powers vested in the Secretary of Education as a result of the COVID-19 pandemic, in order to quickly deliver on promised relief.
Since the first applicants became eligible to have their debts cancelled under PSLF in 2017, 98% have been rejected. Evidence now shows these rejections were driven by widespread mismanagement by ED and abuses by its contracted student loan servicers. Despite reassurances that the rates of debt cancellation via PSLF would improve over time, widespread denials without explanation have continued. For nearly four years, no comprehensive efforts have been made to address the underlying problems driving this systemic failure. As public service workers continue to serve and risk their lives on the front lines of America’s pandemic response, the case for immediate action has grown increasingly urgent. Without immediate action by Secretary Cardona, millions of public service workers, including student loan borrowers in public and nonprofit sectors and those serving in the military, will remain trapped in this broken system.
Read the Letter: Consumer Advocates Letter to Secretary Cardona on Immediate PSLF Action
“Washington broke its promise to a generation of public service workers with far reaching consequences for workers, their communities, and our country,” said Seth Frotman, executive director at the Student Borrower Protection Center. “Teachers, healthcare providers, and millions of others who served on the front lines of America’s pandemic response deserve better than more red tape and bureaucracy– they need Secretary Cardona to use his power under the law to deliver the relief promised by Congress more than a decade ago.”
“Communities across our nation depend on passionate people who dedicate themselves to public service. Whether it be education, health, or safety, we know the sacrifice public service professionals make in order to serve others,” said David Stern, executive director at Equal Justice Works. “Student loan debt is a huge barrier to taking relatively low paying public service jobs and PSLF promises forgiveness after 10 years of public service. Hundreds of thousands of people relied on that program only to be rejected. At Equal Justice Works, we believe our country must deliver on its promise to forgive the debt of public servants after 10 years of service, sacrifice, and contributions.”
Today, the National Education Association (NEA) also released an updated letter to Secretary Cardona calling for the same set of actions and featuring additional signers, including the American Federation of Teachers, the Communications Workers of America, and Labor Council for Latin American Advancement (LCLAA). Two weeks ago, NEA and 14 other labor unions, representing 11 million public service workers, first called on Secretary Cardona to cancel student debt for all borrowers who served for a decade or more.
In 2006, Equal Justice Works, in partnership with the American Bar Association, and many other organizations across the nation joined together to advocate for federal loan repayment programs that would benefit public interest professionals. This effort led to the federal College Cost Reduction and Access Act of 2007, which created the Public Service Loan Forgiveness (PSLF) program, as well as income-based repayment options for federal loans.
The PSLF program was created to provide relief to public service workers with student loan debt in exchange for a decade of service in their communities or to our country.
Unfortunately, since its inception, the program has been mishandled and undermined by the Department of Education and its contracted loan servicers, with only a small portion of eligible public service workers accessing their right to relief. Over the last two years, the Student Borrower Protection Center and the American Federation of Teachers conducted a comprehensive, top-to-bottom review of the PSLF program exposing a decade of widespread mismanagement and abuse that has delayed, derailed, or denied millions of public service workers access to their right to debt relief under the law.
In 2003, Congress passed Higher Education Relief Opportunities for Students (Heroes Act), vesting extraordinary emergency powers in the Secretary of Education to ensure that student loan borrowers are able to shoulder the burdens posed by student debt in the face of a national emergency. In 2020, President Trump and Secretary DeVos repeatedly invoked these emergency powers to pause student loan payments, waive interest charges, and cancel student debt for tens of millions of people.
In December 2020, the SBPC and Demos published a report featuring contributions from leading student loan experts and advocates outlining how the Biden administration could take immediate action to cancel student debt for millions of Americans. As part of this report, Mike Pierce, Policy Director at the SBPC and Rebecca Maurer, Counsel and Program Manager at the SBPC laid out how the Department of Education could use executive authority, including the Secretary’s emergency powers, to deliver justice for public service workers by cancelling student debt for all who have already served for a decade or more.
The Student Borrower Protection Center is a nonprofit organization focused on alleviating the burden of student debt for millions of Americans. The SBPC engages in advocacy, policymaking, and litigation strategy to rein in industry abuses, protect borrowers’ rights, and advance economic opportunity for the next generation of students.
Equal Justice Works is a 501(c)(3) nonprofit organization that creates opportunities for lawyers to transform their passion for equal justice into a lifelong commitment to public service. As the nation’s largest facilitator of opportunities in public interest law, Equal Justice Works brings together an extensive network of law students, lawyers, nonprofit legal aid organizations, and supporters to promote a lifelong commitment to public service and equal justice.