Congressional Republicans offer their own student loan debt solution

n the wake of the Supreme Court’s Friday ruling striking down the Biden administration’s student loan debt cancellation plan, Republicans are moving forward with their own proposed solution.

Conservative lawmakers from both chambers, vocally opposed to the president’s landmark program, which they said was an overreach, celebrated the court’s decision.

Even with the 6-3 ruling against him, President Joe Biden on Friday laid out alternative options to his original call for sweeping debt forgiveness, though some specific details remain unclear.

“I’m announcing today a new path consistent with today’s ruling to provide student debt relief to as many borrowers as possible as quickly as possible,” he said. “We will ground this new approach in a different law than my original plan, the so-called Higher Education Act, that will allow [Education] Secretary [Miguel] Cardona … to compromise, waive or release loans under certain circumstances.”

An on-ramp to repayment will begin later this fall, according to Biden. It will include a 12-month grace period after the pause unfreezes in September.

Federal student loan borrowers should expect interest on their debts to kick back in on Sept. 1 and payments to resume starting in October, the government has said. Repayments had been paused for more than three years amid disruptions from COVID-19.Below is a look at how GOP legislators would address the same issue.

Meeting with the secretary?
Recently, Louisiana Sen. Bill Cassidy, the ranking member of the Senate’s Health, Education, Labor and Pensions (HELP) committee, and House Education and the Workforce Committee Chairwoman Virginia Foxx of North Carolina requested to meet with Cardona on or before July 20 to discuss federal student aid servicer roadblocks as well as internal memos and documents about the department’s strategy for the return to repayment.

“The success of this return to repayment hinges on Secretary Cardona stepping up to the plate and giving borrowers and servicers clear guidance,” Foxx told ABC News in a statement. “Because the Secretary has yet to do that, we are demanding a briefing from him to explain the Department’s plans.”

Cassidy and Senate Republicans previously sent a letter to the secretary seeking to halt Biden’s student debt relief plan in early June, calling it an “affront to the millions of Americans that do not have student loans.”

After passing the Republican-controlled House, the Senate also voted to end the federal pause on repayments and dismantle the plan under the Congressional Review Act (CRA). The GOP received bipartisan support from Sens. Joe Manchin of West Virginia and Jon Tester of Montana, both Democrats, and Arizona’s Kyrsten Sinema, an independent formerly of the Democratic Party.

As expected, the bill was vetoed by Biden.

In February, led by Foxx and Sen. Marsha Blackburn, R-Tenn., more than 170 lawmakers filed two separate amicus briefs with the Supreme Court in opposition to the president’s debt cancellation plan.

An Education Department spokesperson did not say whether Cardona would meet with the lawmakers, but the spokesperson reiterated the administration’s continued focus on student loan debt.

The department remains in constant contact with loan servicers and will be in direct contact with borrowers once repayment resumes, the spokesperson said: “We are fully committed to helping borrowers successfully navigate the return to repayment with the pandemic now behind us.”

GOP alternative
Members of Foxx’s committee have introduced a bill called the Federal Assistance to Initiate Repayment (FAIR) Act, which would allow student loan borrowers to access affordable and burden-free repayment options, according to the text.

Among other changes, it would require the education secretary to make “at least 12 notifications” to borrowers before repayment begins — including options for repayment, the deadline and more.

The legislation would also create an income-driven repayment plan, set at 10% of borrowers’ discretionary income, and would automatically have borrowers repaying based on their income.

Interest would be paused and half of a borrower’s payment would go toward the principal for those with adjusted gross income that is less than 300% of the federal poverty line — or $45,675 for people under 65.

The FAIR Act would also offer various deferment and forbearance options, such as medical residency and active-duty military and National Guard duty.

In a joint statement, Reps. Burgess Owens, Lisa McClain and Foxx called their proposed legislation, H.R. 4144, a “fiscally responsible, targeted response.”

“This Republican solution takes important steps to fix the broken student loan system, provide borrowers with clear guidance on repayment, and protect taxpayers from the economic fallout caused by the administration’s … agenda,” the joint statement reads.

Student debt relief advocates rebuked the proposed House bill.

“The FAIR ACT is anything but fair,” student loan borrowers group We The 45 Million Executive Director Melissa Byrne told ABC News. “It’s disappointing that the House Republicans once again refuse to engage with student loan borrowers and advocates to work on solving the crisis of higher education costs.”