Education Dept. Issues New Delay on Borrower Defense Rule

The U.S. Education Department on Friday announced a new delay of the Obama administration's borrower defense rule, which aims to make it simpler for defrauded students to have their student loan debt wiped clean. The move would effectively block implementation of the regulation until the conclusion of the Trump administration's bureaucratic rewrite of the rule, Inside Higher Ed reported.

In June, Education Secretary Betsy DeVos issued an initial delay—blocking the rule set to take effect on July 1—and announced the appointment of a negotiated rulemaking committee to reconsider the regulation. The agency cited an ongoing legal challenge from an association of California for-profit colleges and a section of the Administrative Procedure Act allowing for delay of the effective date of a new federal rule pending judicial review.

In a pair of regulatory actions, the department on Friday issued an "interim final rule," effective Tuesday, that delays the rules until July 1, 2018 and then formally proposed a further delay of the rules to July 1, 2019. The agency will accept public comments for the next 30 days before finalizing that delay.

The Trump administration said the extra time is needed "to continue to preserve the regulatory status quo" as it negotiates new rules—a process that will begin this fall.

Senator Patty Murray (D-WA), ranking member of the chamber's Health, Education, Labor, and Pensions Committee, blasted the new delay, reported Inside Higher Ed.

"Given the significant number of former for-profit college executives employed by the Department of Education, it's no surprise Secretary DeVos is doubling down on her commitment to put corporations' bottom lines ahead of students and borrowers' best interests," she said. "Instead of giving predatory corporations the green light to continue to take advantage of students, Secretary DeVos needs to stop these outrageous delays and start providing relief to the tens of thousands of students who have been cheated out of their education and savings."

 

Related Links

Federal Register: Interim final rule

https://www.gpo.gov/fdsys/pkg/FR-2017-10-24/pdf/2017-22851.pdf

Federal Register: Notice of proposed rulemaking

https://www.gpo.gov/fdsys/pkg/FR-2017-10-24/pdf/2017-22850.pdf

Inside Higher Ed

https://www.insidehighered.com/quicktakes/2017/10/23/new-delay-borrower-defense-rule