A group of Democratic lawmakers are highlighting a key element that will help student loan borrowers and families navigate financial aid: more funding.
On Wednesday, Massachusetts Sen. Elizabeth Warren led 24 of her Democratic colleagues in calling on Sens. Tammy Baldwin and Shelley Moore Capito — chairwoman and ranking member, respectively, of the Senate Education Committee — to grant the $2.7 billion budget request. of President Joe Biden’s dollars for the office. of federal student aid in fiscal year 2025.
Over the past two years, Biden has requested that Congress provide increased funding to the FSA to help facilitate the return to student loan repayment, the rollout of the new Free Application for Federal Student Aid form, or FAFSA, and a host of new debt repayment and relief programs.
However, Republicans chose to fund the agency uniformly and proposed funding cuts this year. Democrats wrote in their letter, first seen by Business Insider, that the lack of funding “severely undermines the FSA’s ability to implement critical programs.”
“The FSA’s responsibilities have increased to protect students and borrowers, but its federal funding has remained stagnant,” they write. “The lack of adequate resources creates more barriers for students to begin and continue their education.”
Since federal student loan payments resumed in October, many borrowers have faced a list of challenges, including hours-long waits with their servicer, payment inaccuracies, and delayed or missing billing statements .
In addition, the Department of Education has worked to carry out a series of reforms to the Public Service Loan Forgiveness program, implemented the new income-based SAVE repayment plan, and is revamping the student loan servicing system. .
Each of these efforts requires more resources to implement effectively – something service providers themselves have already acknowledged in explaining their own difficulties in helping borrowers.
When it comes to the FAFSA, Republican and Democratic lawmakers have been highly critical of how the Department of Education has facilitated its rollout. While the department intended to create a simplified form for families and students, technical issues delayed the form for several months and aid calculation errors followed, forcing many schools to push back their deadlines of commitment.
Just a day before the Democrats’ letter, a bipartisan group of lawmakers sent a letter to Education Secretary Miguel Cardona requesting that the department ensure the FAFSA form is ready, error-free, for students to access. when they request aid for the following school year. . Democrats wrote in their Wednesday letter that the FSA needs more funding to meet that commitment.
Cardona also expressed the need for Congress to increase funding for the Department of Education in written testimony during a House hearing Tuesday. He wrote that Biden’s $2.7 billion request for the FSA will allow the agency to “support students and student loan borrowers as they navigate these modernized financial aid application and repayment processes student loans.
The Department of Education is also developing its broader student debt relief plan, which is currently in the public consultation period. The department plans to begin implementing the new debt relief this fall, but the presidential election — and likely legal challenges — present uncertainty about that timeline.
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