Senate unveils student loan bill, ahead of Supreme Court ruling on debt forgiveness

As the Biden administration’s student debt relief proposal faces an uncertain fate in the U.S. Supreme Court, Congressional Republicans have proposed an alternative plan. The Lowering Education Costs and Debt Act is a package of five bills addressing the issues driving the cost of higher education and the increasing amounts of debt that students take on to attend school.

“Education is the closest thing to magic in America,” said Sen. Tim Scott, R-S.C., a cosponsor of the bill in the Senate. “Ensuring access to an affordable, high-quality education — from grade school to post-secondary — is the key to a brighter future. This groundbreaking, conservative package attacks the root cause of skyrocketing student loan debt, seeks to drive down the cost of education and sets all students up to succeed.”

The five bills include:

• The College Transparency Act reforms the college data reporting system to ensure students and families have better information on student success and outcomes as they consider higher education institutions.
• The Understanding the True Cost of College Act requires institutions of higher education to use a uniform financial aid letter with clear indications of the types and breakdown of aid included so students and their families can understand and compare financial aid options.
• The Informed Student Borrowing Act supports students in meeting their academic needs and budget when deciding to take out loans by offering clear information about the duration of their loan, their expected monthly payment and how much money they likely will earn after attending their school and program of choice.
• The Streamlining Accountability and Value in Education for Students Act reduces repayment options for borrowers from nine to two to give students and families clarity about which repayment plan best fits their needs.
• The Graduate Opportunity and Affordable Loans Act ends Graduate PLUS loans and puts downward pressure on rising tuition costs by limiting graduate school borrowing. It also allows institutions to set lower loan limits by program to protect students from overborrowing.

Related: Biden’s student debt relief plan: Supreme Court hears arguments, casts more doubt

Two of the bills were previously introduced and obtained bipartisan support. A Republican aide said the rest have “nothing partisan about it. It’s just good, real solutions trying to address some issues that Americans are having to deal with,” but not everyone agrees.

“None of this addresses the root problem,” the Student Debt Collective said in response to the legislation. “We don’t have an ‘information’ crisis. We have a student debt crisis. These bills will guarantee the crisis only gets worse for future generations. This is doubling down on debt-for-education.”

However, Beth Akers, Ph.D., senior fellow at the American Enterprise Institute, supports the legislation.

“With this package, Republican lawmakers have really stepped up to the plate in a big way with reforms that would meaningfully improve our broken system of higher education finance,” she said. “The passage of this legislation would make college a safer bet for students and would protect taxpayers from picking up the bill when colleges and universities fail to deliver. These sensible reforms would be great for American higher education.”

It’s expected that the Supreme Court will make its final decision on student debt relief by the end of June.