June 27, 2020

House Fails to Override Trump’s Veto Limiting Student Loan Debt Relief – The New York Times

House Fails to Override Trump’s Veto Limiting Student Loan Debt Relief - The New York Times
House Fails to Override Trump’s Veto Limiting Student Loan Debt Relief - The New York Times

WASHINGTON — The House tried and failed on Friday to invalidate stringent rules imposed by the Trump administration on student loan forgiveness, falling short of overriding a veto by President Trump.

The override effort, which would have revived bipartisan legislation to overturn regulations put in place last year by Education Secretary Betsy DeVos, failed by a vote of 238 to 173, lacking the two-thirds majority it would have needed to pass. Six Republicans joined every Democrat in voting to defy Mr. Trump’s position.

“It was important to try,” said Representative Susie Lee, Democrat of Nevada, who led the effort. “You have 350,000 students in this country who are waiting for relief.

“They can’t get on with their lives,” she added. “This is a rule that’s clearly stacked in favor of predatory schools and against students.”

The new rules, which make it much more difficult for students who say their schools defrauded them to have their loans forgiven, are now set to take effect July 1.

The president vetoed a bipartisan bill last month to reverse Ms. DeVos’s rules, which toughened standards established under the Obama administration for student borrowers seeking to have their federal loans erased after claiming their colleges defrauded them. Under the new regulations, even if borrowers could show they were victims of unscrupulous universities, they could still be denied relief unless they could prove their earnings had been adversely affected.

Ms. DeVos’s move was met with backlash from veterans’ organizations who argued that it would harm former service members who had been bilked by unscrupulous for-profit colleges. Speaker Nancy Pelosi of California called the new rules “an act of staggering cruelty.”

Those sentiments were echoed on the House floor on Friday during debate.

“The American people do not support Betsy DeVos,” said Representative Pramila Jayapal, Democrat of Washington, who argued the secretary was seeking to reward “predatory for-profit colleges” at students’ expense. “The people’s House stands on the side of the people, and not Betsy DeVos.”

Representative Alma Adams, Democrat of North Carolina, took particular issue with arguments from the Trump administration that the rule protects historically black colleges and universities.

“No H.B.C.U. has ever been implicated,” Ms. Adams said. “That’s fake news.”

Republicans, however, argued the new rules shielded colleges from students who run up debts they simply did not wish to pay.

“The Obama administration used this process to advance an ideological loan-forgiveness scheme,” argued Representative Lloyd K. Smucker, Republican of Pennsylvania.

Representative Steve Watkins Jr., Republican of Kansas, called the Obama-era regulations “costly” and said they led to “abuse.”

At issue is a little-known loan forgiveness rule, called “borrower defense to repayment,” that was the main vehicle the Obama administration used to grant debt relief to tens of thousands of students affected by the collapse of two large for-profit college chains, Corinthian Colleges and ITT Tech, in 2015 and 2016.

Ms. DeVos said the Obama administration did not scrutinize claims in a way that was fair to colleges and taxpayers, and said she was reining in a process that amounted to “free money.” She also said the Obama administration weaponized the rule to target for-profit schools.

Ms. DeVos’s changes raised the bar for borrower relief claims, requiring each applicant to individually prove that a school knowingly misled them, and that he or she was financially harmed by the deception. They also set a three-year deadline on claims.

The department said the new rules would save taxpayers about $11 billion over the next decade.

“That’s $11 billion that students who have been defrauded will now have to pay,” said Representative Robert C. Scott, Democrat of Virginia.

Outraged by the changes, several groups, led by Veterans Education Success, began running advertisements on Fox News hoping to persuade Mr. Trump to reconsider. They argued the new rules did not protect military service members who had long been the targets of predatory tactics by colleges because of their lucrative G.I. benefits.

Ultimately, Mr. Trump sided with Ms. DeVos in arguing the Obama-era regulations were too broad in defining what amounted to educational fraud.

Despite the loss, Ms. Lee said she planned to revisit the issue soon.

“I will not give up the fight on this,” she said. “I’ve actually spent a large part of the past several days calling my Republican colleagues, trying to find another path forward.”

Erica L. Green and Emily Cochrane contributed reporting.