U.S. Senate Overturns Education Department’s Borrower Defense Rule Changes
On March 11, the U.S. Senate passed a resolution that overturns
regulations issued by U.S. Education Secretary Betsy DeVos. The House
Democrats passed a similar resolution earlier this year.
Last year, DeVos issued an overhaul of the borrower defense regulations. These
regulations provide a path for students who are defrauded or misled by their colleges
to get their federal loans discharged, but the new rule significantly tightens
standards for debt relief. The U.S. Department of Education estimates that the
new regulation would produce $11 billion dollars in savings for taxpayers by reducing loan forgiveness.
The new regulation was overturned under the Congressional Review Act of 1996, which
allows lawmakers to block new regulations with simple majorities in the House and Senate.
Democrats called the rule unfair and noted that it favored
for-profit colleges, which is the sector that spurred most of the claims under
the Obama-era borrower defense rule.
The Trump Administration expressed its intent to veto the resolution. A two-thirds
majority is needed to overturn the President’s veto. However, overturning the
President’s veto is unlikely because two-thirds of Congress will likely not
oppose the veto. Therefore, the regulation will go into effect.