Press Releases

Today, Education and the Workforce Committee Chairwoman Virginia Foxx (R-NC), joined by Reps. Burgess Owens (R-UT), Joe Wilson (R-SC), Glenn “GT” Thompson (R-PA), Tim Walberg (R-MI), Elise Stefanik (R-NY), Rick Allen (R-GA), Jim Banks (R-IN), Lloyd Smucker (R-PA), Michelle Steel (R-CA), Julia Letlow (R-LA), Aaron Bean (R-FL), and Brandon Williams (R-NY), sent a letter to Department of Education Secretary Miguel Cardona demanding further information about the Department’s potentially unlawful actions related to student loan consolidation in order to further its “free” college agenda.  
 
In the letter, the lawmakers write: “The Biden administration has relentlessly pursued shifting the burden of repaying federal student loans onto taxpayers with complete disregard to its legal authority. In this vein, we write to seek clarity and raise questions about the Department of Education’s (Department) implementation of several student loan consolidation provisions of law. … Recent events have demonstrated the Department’s serious need for increased oversight and accountability.”
 
The lawmakers continue: “Because of the maladministration of your fundamental obligation to implement the bipartisan FAFSA Simplification Act, millions of families have no idea how they will afford postsecondary education. Despite this devastating impact on families, you and Chief Operating Officer Richard Cordray of FSA have failed to hold key employees in your Department or FSA accountable for their failings.”
 
The lawmakers go on, writing: “A further problem area is the consolidation of FFEL Consolidation Loans into the Direct Loan program. … It is not lawful for student loan borrowers in good standing who possess only a FFEL Consolidation Loan to consolidate their debt into the Direct Loan Program for any other reason including the following: (1) to access the Biden administration’s illegal student loan debt transfer scheme; (2) to enroll in the income-driven repayment (IDR) Saving on a Valuable Education Plan; or (3) to move their privately-held FFEL debt into the Direct Loan Program to benefit from the Department’s legally dubious IDR payment count initiative. … Given FSA’s abominable history of flouting the law and skirting consequences, we have no confidence in the Department’s ability to follow the directives of Congress detailed in the [Higher Education Act].”

The lawmakers conclude by requesting additional information, including:

• The Department’s protocols and directives that are transmitted to federal student loan servicers to ensure FFEL Consolidation Loan borrowers are consolidating into the Direct Loan program for a legally permitted purpose.
• The form or acknowledgment borrowers complete to certify why they are consolidating their FFEL Consolidation Loan into the Direct Loan program for a permissible reason.
• How many FFEL Consolidation Loan borrowers consolidated into the Direct Loan Program between January 20, 2021, and the date of the Department’s response to the Committee’s letter. The data is to be disaggregated by:
• How many of these borrowers were in default and consolidated to access an IDR plan;
• How many of these borrowers consolidated to access PSLF;
• How many of these borrowers consolidated to access the no accrual of interest benefit for active-duty service members;
• How many of these borrowers consolidated for purposes of separating a joint consolidation loan; and
• How many of these borrowers consolidated for other purposes and why.

To read the full letter, click here.

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