Some federal student loan collections resume May 5. What does it mean for Ohio borrowers?
The U.S. Department of Education will soon start federal student loan collections for certain accounts on May 5. But what does this mean for Ohio?
USDE announced Monday
Federal student loan collections are currently on pause until May 5. The Biden-Harris administration refused to lift the pause in October 2023, after Congress mandated that student and parent borrowers should begin to repay their student loans.
According to the DOE press release, this act by the previous administration "failed to process applications for borrowers who applied for income-driven repayment and continued to push misguided 'on-ramps' and illegal loan forgiveness schemes to win points with borrowers and mask rising delinquency and default rates."
The press release states that resuming student loan collections will "protect taxpayers." Lifting the pause will also be accompanied by information to ensure borrowers understand how to resume repayment or exit default.
On Monday, May 5, Federal Student Aid will restart its Treasury Offset Program, administered by the U.S. Department of the Treasury. If you're a federal student loan borrower, you should receive an email about loan repayments over the next two weeks.
Borrowers will have to contact the Default Resolution Group to make a monthly payment, enroll in an income-driven repayment plan, or sign up for loan rehabilitation.
This campaign is meant to "restore commonsense and fairness" by urging student and parent borrowers to repay their loans. The department has also authorized guaranty agencies to begin involuntary collections activities for loans under the Federal Family Education Loan Program.
According to a 2024 study, Ohio takes the No. 9 spot for the states with the most student loan debt.
The ranking compared all 50 states' average student loan debt along with the unemployment rate among 25 to 34-year-olds. Ohio is one of the top states that bear the burden of student debt.
Additionally, Ohio was No. 7 for the student debt-to-income ratio and in the top 20 for the proportion of students with debt and the average amount of student debt.
Nationally, 42.7 million borrowers owe more than $1.6 trillion in student debt, according to the DOE press release.
Roughly 5.3 million student loan borrowers in the U.S. are currently in default, according to PBS.
According to an earlier estimate, the Department of Education's budget for Ohio for fiscal year 2025 estimate is more than $5.65 billion, according to the DOE financial preview. In 2024, the funding estimate was over $5.48 billion. The 2025 estimate represents 3.08% of the DOE's estimated $183.4 billion expenditure in 2025.
DOE's most recent data for Ohio's total funding is from the year 2023, with a total of nearly $5.25 billion. Ohio's Department of Education and Workforce reports that Ohio has spent more on primary and secondary education than ever before, with $13.44 billion appropriated for 2025.
In March, the Trump Administration said it pledged to dismantle the Education Department.
Created by Congress in 1979, the U.S. Department of Education is a cabinet-level government department focused on promoting educational excellence, enhancing student achievement and readiness for global competition, and guaranteeing equal access for students of all ages, according to its website. Here's why the Department of Education was established:
Strengthen the federal commitment to equal educational opportunity for all people.
Support states, local school systems, the private sector, educational institutions, research institutions, community organizations, parents, and students in improving education quality.
Encourage public, parent and student involvement in federal education programs.
Advance education quality through federal research and information sharing.
Improve the coordination of federal education programs.
Enhance management and efficiency of federal education activities by simplifying processes, reducing administrative burdens, and minimizing unnecessary paperwork for fund recipients.
Increase the accountability of federal education programs to the president, Congress and the public.
Funding to public schools serving millions of students.
Manage college financial aid, Pell Grants, and oversee federal student loans.
This article originally appeared on The Columbus Dispatch: Some federal student loan collections resume May 5. More on Ohio impact
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
The Hill
22 minutes ago
- The Hill
Trump administration issues rule undermining Biden car fuel efficiency rules
The Trump administration on Friday took a step to undermine Biden-era rules that tightened fuel efficiency requirements for cars and trucks. The Transportation Department published an interpretive rule that says that the Biden administration improperly considered electric vehicles as a way to make vehicle fleets more efficient While this determination does not formally end the Biden-era rule, the Trump administration indicated that while the rulemaking process plays out it may not enforce the Biden-era standards. 'Pending the rulemaking process for the establishment of replacement standards, [the National Highway Traffic Safety Administration] will exercise its enforcement authority with regard to all existing… standards in accordance with the interpretation set forth in this rule,' it stated. Transportation Secretary Sean Duffy, in a written statement, accused the previous administration of trying to push an electric vehicle 'mandate.' 'Under President Trump's leadership, we are making vehicles more affordable and easier to manufacture in the United States,' Duffy said. 'The previous administration illegally used [Corporate Average Fuel Economy] standards as an electric vehicle mandate.' The Biden administration issued a rule requiring cars to be about 2 percent more fuel efficient each year while heavy duty pickup trucks and vans would have to be 10 percent more efficient each year from 2030 to 2032 and 8 percent more efficient in the years after. President Trump has long talked about getting rid of the Biden administration's efforts to promote electric vehicles. He has argued that these efforts harm consumers' freedom to choose what kinds of cars they want to drive and could lead to strife for autoworkers. Democrats, meanwhile, have argued that shifting toward more electric vehicles would mitigate air pollution and climate change – and put the U.S. at the forefront of an emerging market. While Trump has long lamented the previous administration's electric vehicle policy, the release of the administration's determination comes just one day after an explosive feud emerged between the president and Tesla mogul Elon Musk. The Transportation Department rules came alongside a separate, more stringent regulation for vehicle tailpipe emissions from the Environmental Protection Agency (EPA) that in practice has a greater effect on the vehicle market's fuel efficiency and is not impacted by the Trump administration's latest maneuver. However, the department's fuel economy rules would act as a backstop if the EPA rule was to be overturned. Republicans are attempting to eliminate that rule through their 'big, beautiful bill.'
Yahoo
an hour ago
- Yahoo
UAE's data center project with U.S. tech firms faces security concerns
-- A massive deal to create one of the world's largest data center hubs in the United Arab Emirates (UAE) with American technology, continues to face persistent security concerns, according to a Friday report by Reuters. The deal, worth billions of dollars, is reportedly far from finalized. The proposed site, spanning 10 square miles, is financed by G42, a tech company linked to the Emirati state. G42 is spearheading the development of the UAE's artificial intelligence (AI) industry. Tech giants Nvidia (NASDAQ:NVDA), OpenAI, Cisco (NASDAQ:CSCO), Oracle (NYSE:ORCL), and Japan's SoftBank (TYO:9984) are collaborating with G42 on the initial phase of the project, dubbed Stargate UAE, which is slated to launch in 2026. However, U.S. officials are yet to establish the security conditions for exporting the advanced chips or how the agreement with the Gulf state will be enforced. This leaves the deal unresolved. During a visit by then-President Trump, Abu Dhabi pledged to align its national security regulations with Washington's, including measures to prevent the misuse of U.S. technology. Concerns remain about the UAE's close ties with China, with the report noting that these issues have been consistent during both Biden and Trump administrations. The primary concern is the reliability of the Gulf state as a strategic partner. The report didn't indicate if new evidence had surfaced, but stated that existing concerns are still not addressed. During Trump's first term, the UAE and other Gulf states proceeded with the deployment of Huawei 5G technology, despite opposition from the U.S. Some U.S. officials also question whether the UAE can effectively prevent American technology from reaching Washington's adversaries, the report added. Related articles UAE's data center project with U.S. tech firms faces security concerns Melius upgrades Deere on long-term tech moat and recurring revenue upside Taseko Mines shares surge on landmark agreement with Tŝilhqot'in Nation
The Hill
an hour ago
- The Hill
The One Big Beautiful Bill Act delivers for America. Now the Senate Must Deliver Too.
The House of Representatives has delivered on the American people's mandate by passing the One Big Beautiful Bill Act, the most comprehensive and consequential set of conservative reforms in our nation's history. This transformative package includes record levels of tax cuts, spending reduction, and border and national security investment. The ball is now in the Senate's court and their mission is simple: move the One Big Beautiful Bill to the president's desk as soon as possible. This legislation delivers a historic tax cut and $5,000 raise for the average American family to provide immediate relief to working households struggling after four years of economic mismanagement under the Biden administration. It permanently expands the 2017 Trump tax break for small businesses, the backbone of our economy, and enhances incentives for American companies to invest, grow and raise worker wages for decades to come. The bill's impact extends beyond the Tax Cuts and Jobs Act by providing additional relief to lower- and middle-income Americans by eliminating taxes on tips, exempting overtime pay and doubling the tax credit for seniors on a fixed income. Additionally, we support working families by increasing the child tax credit to $2,500 per family, making interest on car loans tax deductible and expanding health savings accounts. We're strengthening America's security by investing $46 billion to complete President Trump's border wall and hiring 18,000 new immigration enforcement personnel to detain and deport at least 1 million illegal immigrants annually. We're committing almost $150 billion to rebuild America's military, including $34 billion to revitalize our naval fleet and $25 billion for missile defense. Furthermore, we're unleashing American energy dominance by opening federal lands for drilling, reducing the regulatory stranglehold on conventional fuels, and eliminating hundreds of billions in green new deal subsidies that have made U.S. energy more expensive and less reliable. And we're accomplishing all of this while reducing spending by $1.6 trillion, the largest spending reform package in American history by two-fold. This isn't just fiscal responsibility; it's the beginning of a generational reset that will restore America's financial health. At every stage of this process, Democrats have resorted to fear-mongering and false claims to undermine this critical legislation. So desperate to derail the bill, they manipulated Congressional Budget Office analyses to mislead the American people about the outcomes of the One Big Beautiful Bill. They use the fact that we prohibit illegal immigrants and able-bodied adults who refuse to work from receiving taxpayer-funded welfare services to fallaciously suggest that vulnerable people are being 'ripped away' from the social safety net. Furthermore, they deliberately cherry-pick CBO data to spread the false narrative that our tax cuts only benefit the wealthy. Never mind the fact that CBO's own data confirm that American households in every tax bracket would see increased after-tax income under our legislation. The left knows they can't convince the American people on the substance of this bill, so they have resorted to fabrications. The Senate now holds America's economic future in its hands. The House spent months developing a balanced budget reconciliation bill that advances every pillar of the America First vision, including restoring our nation's fiscal health by reining in the runaway spending and reducing our debt-to-GDP ratio. While the Senate may be able to make modest improvements, they must resist the temptation to significantly alter this carefully crafted legislation. Any major changes risk upsetting the delicate balance struck in the House and derailing President Trump's America First agenda. In fact, every day the Senate delays this process is another day closer to tax hikes for working families, uncertainty for small businesses, and a military and border patrol lacking the resources they need to be successful. The American people gave President Trump and unified Republican leadership a clear mandate to reverse course on the failures of the last four years — they expect action, not endless deliberation. The House has delivered. Now it's time for the Senate to meet this moment with the urgency it demands. America's next Golden Age is within reach — but Republicans must come together in order for us to seize it. House Budget Chairman Jodey Arrington represents Texas's 19th Congressional District in the U.S. House of Representatives. He sits on the House Ways and Means Committee and the Joint Economic Committee. August Pfluger represents Texas's 11th Congressional District in the U.S. House of Representatives. He is the chairman of the Republican Study Committee and sits on the House Committee on Energy and Commerce.
