Latest news with #JamesBergeron
Yahoo
4 days ago
- Business
- Yahoo
NCLA Asks Sixth Circuit to Revive Suit Over Dept. of Education's Illegal Student Loan Payment Pause
Mackinac Center for Public Policy v. U.S. Department of Education; Sec'y of Education Linda McMahon, in her official capacity; and James Bergeron, Chief Operating Officer of Federal Student Aid, in his official capacity Washington, DC, June 06, 2025 (GLOBE NEWSWIRE) -- The New Civil Liberties Alliance filed an opening brief today asking the U.S. Court of Appeals for the Sixth Circuit to reverse a district court's dismissal, for lack of standing, of our Mackinac Center for Public Policy v. Dept. of Education lawsuit against the Department's unlawfully forgiving 35 months of interest on student loans. Without any statutory authority, the Department extended Congress's original six-month interest forgiveness and payment suspension for nearly three more years, cancelling debt in violation of the Constitution's Appropriations Clause at a cost of at least $175 billion to taxpayers, harming the Mackinac Center in the process. This scheme injures public-service employers like Mackinac by reducing the financial incentives for (potential) employees to participate in the Public Service Loan Forgiveness (PSLF) program. The Sixth Circuit should decide Mackinac does have standing and require the district court to hear the case on the merits against the Department's unlawful policy. Established by Congress, the PSLF program allows employees to have their student-loan debt forgiven after ten years of work with one or more public-service employers. When the Department excused debtors from paying interest on their loans, it decreased—dollar for dollar—the wage subsidy the program promised to public-service employers like the Mackinac Center, making it more expensive for them to keep compensating their PSLF employees at the same level. The economic harm caused by the Department's unlawfully excusing student-loan debtors from honoring their obligations is enough, on its own, to require the government to answer for its actions in court. But in addition to that, the Department's lawless decisions also skewed the labor market in a way that frustrates the congressionally-designed PSLF program, increases the cost for the Mackinac Center to compete for college-educated employees, and costs taxpayers billions. The Department caused these injuries, and now the Court of Appeals should make sure it must answer for them. NCLA released the following statements: 'Governmental agencies cannot blithely ignore the law without expecting to answer for the harm their unlawful actions cause organizations like the Mackinac Center. We trust the Court of Appeals will make that clear to the Department of Education.'— Daniel Kelly, Senior Litigation Counsel, NCLA 'The Department of Education under Secretary McMahon should settle this case. What possible reason does it have to keep defending the lawless regime instituted by former Secretary Miguel Cardona and Richard Cordray to forgive student-loan debt—or in this case interest on that debt—without authority from Congress?'— Mark Chenoweth, President, NCLA For more information visit the case page here. ABOUT NCLA NCLA is a nonpartisan, nonprofit civil rights group founded by prominent legal scholar Philip Hamburger to protect constitutional freedoms from violations by the Administrative State. NCLA's public-interest litigation and other pro bono advocacy strive to tame the unlawful power of state and federal agencies and to foster a new civil liberties movement that will help restore Americans' fundamental rights. ### CONTACT: Joe Martyak New Civil Liberties Alliance 703-403-1111 in to access your portfolio
Yahoo
21-04-2025
- Business
- Yahoo
A move that would've surged married student-loan borrowers' payments was a mistake, Trump's admin says
The Education Department corrected a legal filing that changed payment calculations for married student-loan borrowers. The previous filing said spousal income would be used to calculate payments, even if borrowers filed separately. The department said that the change was "erroneous," and the calculations will not change. Married student-loan borrowers won't have to worry about changes that could increase their monthly payments after all. After the American Federation of Teachers sued President Donald Trump's administration for taking down online access to income-driven repayment applications, the Department of Education wrote in a legal filing that married student-loan borrowers who file separate tax returns would have their combined income counted to calculate monthly payments. That would've surged some borrowers' payments because it would mean that monthly payments on an income-driven repayment plan would be based on a higher combined income. The Department of Education corrected that in a legal filing last week, saying that the change to married borrowers' payment calculations "was erroneous." Instead, Acting Under Secretary James Bergeron said that married borrowers filing separately would have the spouse counted in the family size to calculate monthly payments. "But, to be clear, the inclusion of a spouse for purposes of determining family size does not involve the consideration of spousal income," the filing said. So, for now, the process for monthly payment calculations will stay the same, and married borrowers who file taxes separately do not have to worry about affording payments based on the combined spousal income. The Education Department said it initially removed online access to income-driven repayment applications as a "required consequence" of a federal court blocking the SAVE plan. SAVE, which was created by former President Joe Biden to give borrowers cheaper monthly payments and a shorter timeline to debt relief, has been blocked since last summer following a lawsuit from GOP-led states. Borrowers enrolled in SAVE are on administrative forbearance pending a final legal decision, and they can choose to apply for a different repayment plan if they want to continue making payments and earning credit toward the Public Service Loan Forgiveness program. However, there is not yet a timeline for when servicers will begin to process the backlog of income-driven repayment applications. "This timeline is due to the servicers' internal procedures," Bergeron wrote. "Specifically, before servicers can begin to process applications, they must update the processing rules in their systems according to the terms of their contracts with Education." Have a tip or story to share? Contact this reporter via email at asheffey@ or Signal at asheffey.97. Use a personal email address and a nonwork device; here's our guide to sharing information securely. Read the original article on Business Insider
Business Insider
21-04-2025
- Business
- Business Insider
A move that would've surged married student-loan borrowers' payments was a mistake, Trump's admin says
Married student-loan borrowers won't have to worry about changes that could increase their monthly payments after all. After the American Federation of Teachers sued President Donald Trump's administration for taking down online access to income-driven repayment applications, the Department of Education wrote in a legal filing that married student-loan borrowers who file separate tax returns would have their combined income counted to calculate monthly payments. That would've surged some borrowers' payments because it would mean that monthly payments on an income-driven repayment plan would be based on a higher combined income. The Department of Education corrected that in a legal filing last week, saying that the change to married borrowers' payment calculations "was erroneous." Instead, Acting Under Secretary James Bergeron said that married borrowers filing separately would have the spouse counted in the family size to calculate monthly payments. "But, to be clear, the inclusion of a spouse for purposes of determining family size does not involve the consideration of spousal income," the filing said. So, for now, the process for monthly payment calculations will stay the same, and married borrowers who file taxes separately do not have to worry about affording payments based on the combined spousal income. The Education Department said it initially removed online access to income-driven repayment applications as a "required consequence" of a federal court blocking the SAVE plan. SAVE, which was created by former President Joe Biden to give borrowers cheaper monthly payments and a shorter timeline to debt relief, has been blocked since last summer following a lawsuit from GOP-led states. Borrowers enrolled in SAVE are on administrative forbearance pending a final legal decision, and they can choose to apply for a different repayment plan if they want to continue making payments and earning credit toward the Public Service Loan Forgiveness program. However, there is not yet a timeline for when servicers will begin to process the backlog of income-driven repayment applications. "This timeline is due to the servicers' internal procedures," Bergeron wrote. "Specifically, before servicers can begin to process applications, they must update the processing rules in their systems according to the terms of their contracts with Education."
Yahoo
15-04-2025
- Business
- Yahoo
Virginia braces for changes to student aid programs
(Photo by) Lawmakers and education advocates fear changes to student aid programs being solicited by the U.S. Department of Education, including altering Public Service Loan Forgiveness and income-based repayment plans, could hurt students, especially the neediest seeking support to pay for school. According to the State Council of Higher Education of Virginia, 32% of undergraduate students in the commonwealth borrowed money during the 2023-2024 school year, which is a decrease from 43% in the 2012-2013 school year. During the 2023-24 school year, Virginia was awarded $1.4 billion in federal funds, with an average of $11,000 going to each of 131,045 students. On April 3, the U.S. Department of Education announced it is seeking public feedback on changes to its student aid regulations that 'streamline or eliminate unnecessary regulatory processes that are not required by law.' The agency added that the process should focus on how Title IV regulations have impacted 'institutions, states and other partners,' and if implementing certain student aid programs 'may be inhibiting innovation and contributing to rising college costs.' Acting Under Secretary James Bergeron said in an April 3 statement: 'Not only will this rule making serve as an opportunity to identify and cut unnecessary red tape, but it will allow key stakeholders to offer suggestions to streamline and improve federal student aid programs.' According to Federal Student Aid, an office in the Department of Education, the office provides more than $111 billion in federal student aid each year through grants, loans and work-study, which allows students at participating schools to earn money to pay for tuition, books and housing. Virginians commonly apply for assistance by completing the FAFSA, which has recently been overhauled and faced criticism for its delays, or the VASA application to their preferred institution. State Sen. Ghazala Hashmi, D-Richmond, told the Mercury she anticipates hearing from her constituents soon about the proposed changes as students and families begin applying for federal financial aid for the fall semester. 'So many of our students depend absolutely on Pell Grants (and) on the federal loans in order to have access to higher education,' Hashmi said, 'and so with the wholesale firing of so many employees in the Department of Education, the ability of that department to be efficient and effective in processing these applications is on the line.' Hashmi said she's also concerned that staff cuts at the U.S. Department of Education could negatively impact the agency's ability to handle issues 'as they come up' for those seeking assistance. Some of the applicants seeking assistance are first-generation and low-income students. One of the most controversial programs being considered for a change is the Public Service Loan Forgiveness program, which forgives the student loan balances of borrowers who make 10 years of payments and hold public service jobs, such as working for the government or a nonprofit. On March 7, President Donald Trump directed the agency to review the program through an executive order claiming former President Joe Biden's administration 'abused' the program by using taxpayer funds to pay off employee loans before they were up. The order said the previous administration also 'misdirected' tax dollars into 'activist organizations that not only fail to serve the public interest, but actually harm our national security and American values, sometimes through criminal means.' However, critics have argued the administration has instead targeted nonprofit organizations that focus on assisting immigrants and members of the LGBTQ community. 'Threatening to punish hardworking Americans for their employers' perceived political views is about as flagrant a violation of the First Amendment as you can imagine,' said Aaron Ament, president of the National Student Legal Defense, in a March statement. 'If the Trump administration follows through on this threat, they can plan to see us in court.' Trump also wrote in the order that individuals employed by organizations whose activities have a 'substantial illegal purpose' shall not be eligible for public service loan forgiveness. The education department will also be taking feedback to improve the Income-Contingent Repayment plan, which allows students to pay back what is owed on a fixed monthly plan over 12 years, adjusted based on their income or 20% of the extra money. With the threats to overhaul education, including cuts to research institutions, Del. Sam Rasoul, D-Roanoke, said the idea of changing financial aid regulations is concerning for students. Financial aid offices at various colleges and universities are charged with processing applications and creating aid packages. But, with the FAFSA issues, administrators have already been frustrated with the delays. Rasoul said this is going to create a 'bureaucratic mess for our students and universities as we move forward.' Hashmi added, 'This is really, really concerning, and it is going to create a tidal wave of concerns for not just the students, but for our colleges and universities and especially in those institutions that have large populations of students who come with federal financial aid.' The agency will hold an in-person meeting on April 29 and a virtual hearing on May 1. Public comments must be submitted through the Federal eRulemaking Portal. As of April 14, 285 comments have been submitted to the Federal Register. The deadline for comments is May 5. SUBSCRIBE: GET THE MORNING HEADLINES DELIVERED TO YOUR INBOX
Yahoo
03-04-2025
- Business
- Yahoo
Are Key Student Loan Forgiveness and Repayment Plans About to See Big Changes?
Got any suggestions for improving the federal student loan program and its forgiveness options? The Department of Education wants to hear them. The department announced in a press release today that it will invite public feedback on ways to streamline higher education regulations and federal aid programs. It specifically asked for ideas for improving the Public Service Loan Forgiveness (PSLF) program, the Pay As You Earn (PAYE) Repayment plan and the Income-Contingent Repayment (ICR) plan. "This process will focus on how the Department can rightsize Title IV regulations that have driven up the cost of college and hindered innovation," Acting Undersecretary James Bergeron said in the press release. The department will host two public hearings: an in-person meeting on April 29 at the Department of Education's Barnard Auditorium in Washington, and a virtual hearing on May 1, although the link provided is currently broken. You can also submit written comments through the Federal eRulemaking Portal at You'll need the docket ID to search for the document where you can submit your comments. The document has been sent to the Office of the Federal Register but has not yet been scheduled for publication, according to an unofficial copy of the Intent to Establish Negotiated Rulemaking Committees. This move to gather feedback may be in response to President Donald Trump's March 7 executive order to limit eligibility for the Public Service Loan Forgiveness program, a debt relief plan that wipes out student loan balances for eligible teachers, nurses and other public servants after 10 years of on-time payments. Millions of student loan borrowers have been left in limbo after a federal court blocked the Saving for a Valuable Education debt repayment plan. PAYE and ICR plans are available again after applications were temporarily frozen, but the forgiveness component for both plans is still unavailable. Millions more restarted payments after a pandemic forbearance period ended last fall. Trump also issued an executive order last month to start dismantling the Department of Education and announced that the Small Business Administration would "immediately" begin handling the entire federal student loan portfolio. We'll keep you updated as more details are released.
