{"id":34165,"date":"2017-07-10T05:17:08","date_gmt":"2017-07-10T05:17:08","guid":{"rendered":"http:\/\/www.biphoo.com\/bipnews\/?p=34165"},"modified":"2017-07-10T05:19:14","modified_gmt":"2017-07-10T05:19:14","slug":"trump-changes-higher-ed-with-rollback-of-obama-era-consumer-protections","status":"publish","type":"post","link":"https:\/\/www.biphoo.com\/bipnews\/news\/trump-changes-higher-ed-with-rollback-of-obama-era-consumer-protections.html","title":{"rendered":"Trump changes higher ed with rollback of Obama-era consumer protections"},"content":{"rendered":"

Trump changes higher ed with rollback of Obama-era consumer protections<\/span><\/strong><\/span><\/h2>\n

Trump changes higher ed with rollback of Obama-era consumer protections:- Step by step, the Trump administration is walking back policies and rules in higher education that its predecessor said were needed to protect students who rely on federal funding to pursue a degree.<\/span><\/p>\n

Supporters say the Education Department under President Trump is restoring balance after overreach during the Obama administration led to punitive regulations and aggressive policing that threatened the stability of schools and student loan companies. But consumer advocates say they fear Trump is unraveling years of work to ensure borrowers are placed ahead of profits.<\/span><\/p>\n

Through the first half of the year, the department led by Education Secretary Betsy DeVos has withdrawn, delayed or announced plans to revamp more than a half dozen Obama-era measures involving federal student aid.<\/span><\/p>\n

\u201cThe U.S. Department of Education\u2019s illegal refusal to implement these protections means that more students will continue to drown in debt, while taxpayers foot the bill,\u201d said Massachusetts Attorney General Maura Healey (D).<\/span><\/p>\n

What started as a slow chipping away of Obama administration directives has turned into full-fledged overhaul of regulations.<\/span><\/p>\n

In March, the department announced schools would be given more time to appeal poor reviews under what is known as the \u201cgainful employment\u201d rule, which threatens to withhold student aid from vocational programs whose graduates consistently end up with more debt than they can repay.<\/span><\/p>\n

By June 14, the department announced an effort to rewrite the rule entirely. Weeks later, DeVos said schools would be given another year to comply with certain provisions and tell students how their programs are performing.<\/span><\/p>\n

\u201cThe secretary\u2019s priority is to put students\u2019 needs first, and the department is committed to doing just that,\u201d said department spokeswoman Liz Hill. \u201cEvery step taken to reduce regulatory burdens or to enter a negotiated rulemaking process is done with the best interests of students in mind.\u201d<\/span><\/p>\n

Another much-debated rule is \u201cborrower defense to repayment,\u201d which erases federal loans for students whose colleges used illegal or deceptive tactics to get them to borrow money to attend. On the books since the 1990s, the rule was revised last year to speed up and simplify the claims process and shift more of the cost of discharging loans onto schools.<\/span><\/p>\n

Before those changes could take effect July 1, DeVos suspended them last month and said she would convene a committee to reconsider the matter. That led Healey and 18 other Democratic state attorneys general to file a lawsuit Thursday seeking to prevent any delay of the updated borrower-defense rule.<\/span><\/p>\n

DeVos said her action will have no impact on tens of thousands of pending claims, but some borrowers say the process has already ground to a halt.<\/span><\/p>\n

In early January, Jessica Madison received a notice from the department approving the forgiveness of $19,000 she amassed in debt for a paralegal program at Everest College in Clearwater, Fla., a for-profit school that was operated by now-defunct Corinthian Colleges. The notice, reviewed by The Washington Post, said the debt would be discharged within 60 to 120 days, but it was not.<\/span><\/p>\n

Instead, Madison said the government has been garnishing her paycheck to recoup the debt. She said she has struggled to repay the money since leaving Everest in 2009 because it took her nearly three years to land a full-time job.<\/span><\/p>\n

\u201cI wasn\u2019t able to have power for weeks because my checks couldn\u2019t cover the bills,\u201d Madison said. \u201cThis has put me in a deep hole that is taking long to crawl out of.\u201d<\/span><\/p>\n

Hill declined to discuss Madison\u2019s case. But the department spokeswoman said \u201ctoo many students .\u2009.\u2009. have gotten caught up in a convoluted and confusing process set up by the previous administration.\u201d<\/span><\/p>\n

\u201cIt is our aim to make sure students are protected from predatory practices, taxpayers are protected and universities and colleges have clear, fair and balanced rules to follow,\u201d she added.<\/span><\/p>\n

Hill said the department has discharged debt for nearly half of the 16,453 approved claims it inherited from the Obama administration. About 64,000 remaining applications for relief, some three years old, are still under review.<\/span><\/p>\n

Consumer attorney Toby Merrill said the tedious process of approving individual claims is exactly why the Obama administration included automatic loan discharges for groups of defrauded students.<\/span><\/p>\n

For-profit colleges contend that the Obama administration\u2019s initiatives were designed to cripple their schools. DeVos has voiced sympathy with these complaints, calling the gainful-employment rule \u201coverly burdensome and confusing\u201d for schools.<\/span><\/p>\n

But advocates of the rule say it protects students from shoddy programs and high loan-default rates. Ninety-eight percent of the programs that failed to meet the standards outlined in the rule are offered by for-profit colleges.<\/span><\/p>\n

Rewriting the gainful-employment and borrower-defense rules is part of a broader effort at the department to reduce regulation.<\/span><\/p>\n

DeVos said last month that a regulatory reform task force is scrutinizing over 150 rules and more than 1,700 pieces of policy guidance. Many could be targeted for repeal or modification.<\/span><\/p>\n

\u201cIf you had to summarize the actions that we\u2019ve seen so far from the Department of Education, it\u2019s an effort to reduce the federal footprint,\u201d said Terry W. Hartle, senior vice president of the American Council on Education.<\/span><\/p>\n

The council, which represents college and university presidents, had been skeptical during the Obama administration of what it viewed as a trend toward federal micromanagement of schools.<\/span><\/p>\n

The task force is co-chaired by Robert S. Eitel, a former attorney at for-profit college operator Bridgepoint Education, who is now senior counsel to DeVos. Critics say the task force is failing to account for the views of students.<\/span><\/p>\n

\u201cAt no point are they asking for the input of student loan borrowers or people enrolled in college,\u201d said Alexis Goldstein, senior policy analyst at the progressive Americans for Financial Reform. \u201cThe common theme here is enriching a certain number of private actors at the expense of protections for \u00adborrowers.\u201d<\/span><\/p>\n

Goldstein cited DeVos\u2019s withdrawal of three Obama-era memos designed to strengthen consumer protections for student loan borrowers. One required the department to consider a loan servicer\u2019s record, including consumer complaints and state investigations, before awarding a contract.<\/span><\/p>\n

\u201cIt was a straightforward memo,\u201d Goldstein said. \u201cGetting rid of it just paves the way for student loan companies that have committed abuses against borrowers to continue on.\u201d<\/span><\/p>\n

Department spokeswoman Hill said the directives contained \u201cshifting deadlines, changing requirements and even regulations that contradicted themselves.\u201d She said the department \u201cretained all of the meaningful borrower protections\u201d in its amended service contract.<\/span><\/p>\n

But the revised contract stripped out a requirement that the company have specialists on hand to aid people in delinquency, a feature meant to stem loan defaults.<\/span><\/p>\n

DeVos frames the changes she has made as necessary reforms to complex policies. Not only does she want to recast Obama-era regulations, she also has suggested that Congress should consider scrapping the Higher Education Act of 1965 and starting over.<\/span><\/p>\n

\u201cIt doesn\u2019t make a lot of sense to simply amend a 50-year-old law,\u201d DeVos said in June to the Association of Public and Land-grant Universities. \u201cAdding to a half-century patchwork will not lead to meaningful reform. Real change is needed.\u201d<\/span><\/p>\n

There are no signs that Congress will act on that recommendation. But it seems clear that the administration is seeking to shift the federal role in higher education. What\u2019s not clear is the end goal. For all of the measures that have been repealed, the department has been short on the specifics of replacements.<\/span><\/p>\n

\u201cThe early moves seem to be responsive to industry pet peeves,\u201d said Rohit Chopra, the former student loan ombudsman at the Consumer Financial Protection Bureau. \u201cIt\u2019s just not clear to me what\u2019s the vision.\u201d<\/span><\/p>\n

Source:-\u00a0https:\/\/www.washingtonpost.com\/local\/education\/trump-changes-higher-ed-with-rollback-of-obama-era-consumer-protections\/2017\/07\/09\/89acd78a-59e3-11e7-9b7d-14576dc0f39d_story.html?utm_term=.cbbdf137399d<\/span><\/p>\n

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