STATE LAWMAKERS ACROSS AMERICA TAKE ACTION TO ADDRESS STUDENT LOAN DEBT CRISIS

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[Student Loan News]
Former Colorado State Senator Jessie Ulibarri: “While the Trump Administration and Congress continue to prioritize profits for the student loan industry, state governments are taking decisive and bold action to ensure every person can pursue an education without being buried in debt.”
Photo Wikimedia Commons

Student loan debt crisis--which is over $1 trillion--has  "many buried in debt," says former Colorado State Senator Jessie Ulibarri.

As students return to college campuses this month, the State Innovation Exchange (SiX) released a report that highlights the most important trends in legislation that state lawmakers have crafted to address the student debt crisis.

Common approaches include curtailing abuses at for-profit institutions, reining in the student loan industry, helping current student loan holders reduce or consolidate their debt, and creating a better environment for current and future students.

Close to 70 percent of college students graduate with debt, and the collective student loan debt in the United States in 2019 is now over $1.5 trillion. This debt has a wide effect not just on the Americans with student debt, but across the economy.

“Everyone deserves the opportunity to invest in their future through education, but an entire generation must defer their dreams due to the crushing weight of student debt,” said the Hon. Jessie Ulibarri, SiX Executive Director. “While the Trump Administration and Congress continue to prioritize profits for the student loan industry, state governments are taking decisive and bold action to ensure every person can pursue an education without being buried in debt.”

Examples from the report include:

Colorado (2019 CO Senate Bill 2) and New York (2019 NY Senate Bill 1508/Chapter 58) joined the states who have stepped up to regulate the student loan industry by clarifying the professional requirements necessary for student loan servicers including but not limited to licensure requirements, grounds for suspension and/or revocation, examinations, and penalties.

Colorado (2019 CO Senate Bill 2) and Maryland (2019 MD House Bill 594/Chapter 546) took steps to prohibit student loan servicers from engaging in unfair or deceptive practices and misapplying payments made by residents.

Connecticut (2019 CT Senate Bill 72/Public Act 86), North Dakota (2019 North Dakota House Bill 1171) and New Hampshire (2019 NH Senate Bill 12) passed legislation to provide loan repayment supports, including tax credits to employers for making student loan payments and incentives for graduates to stay and work in the state.

New Jersey enacted legislation (2019 NJ Senate Bill 3125/Chapter 62) to codify a Repayment Assistance Program for eligible residents dealing with financial hardship to pay a reduced monthly loan payment based on their income, with some minimum payments as low as $5 per month for the first two years. A supplementary program, the Household Income Affordable Repayment Plan allows those still going through financial hardship to pay as low as $25 a month and restructures the terms of their loans.

Arkansas (2019 AR House Bill 1296/Act 250), Iowa (2019 IA Senate File 304), Kentucky (2019 KY House Bill 118/Chapter 6), Louisiana (2019 LA House Bill 423/Act 227), and Texas (2019 TX Senate Bill 37) all enacted legislation to prevent a licensing authority from suspending or revoking occupational licenses based solely on default or delinquency on student loans.

The State Innovation Exchange (SiX) is a national resource and strategy center that supports state legislators who seek to strengthen our democracy, fight for working families, defend civil rights and liberties, and protect the environment. We do this by providing training, emphasizing leadership development, amplifying legislators’ voices, and forging strategic alliances between our legislative network and grassroots movements.

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