Sen. Joni Ernst and Rep. Julia Letlow are demanding a review of how funds were spent at the Office of Federal Student Aid and whether any of that money was siphoned off for President Biden’s student loan forgiveness plan.
In particular, the two Republicans homing in on FSA’s use of money set aside for the Free Application for Federal Student Aid (FASFA) form overhaul that has been dogged by glitches and delays.
“It remains unclear whether those funds were used to promote an efficient overhaul of the FAFSA
form or for other projects, specifically the $153 billion in student loan ‘forgiveness’ approved to
date,” Ernst (R-Iowa) and Letlow (R-La.) wrote in a letter to the Office of the Inspector General for the Education Department.
The two Republicans claimed that during government spending negotiations for fiscal year 2023, the GOP offered a 20% hike for FSA provided it couldn’t be used on student loan cancellation, but Democrats refused that offer.
Since the start of fiscal year 2021, FSA has received roughly $8 billion in funds appropriated by Congress, according to the two lawmakers.
Biden has made a big push for mass student loan cancellation. In August 2022, he announced a sweeping program to scrub a big chunk out of loans en mass, which was estimated to cost around $400 billion by the Congressional Budget Office.
The White House estimated the program would provide relief to at least 43 million Americans. However, the Supreme Court shut it down in June of last year, concluding he unconstitutionally circumvented Congress.
Since then, the president and his administration have been on the hunt for avenues to provide broad-based student loan relief.
Earlier this month, the Education Department rolled out another round of forgiveness, announcing it would wipe out $7.4 billion worth of loans for 277,000 borrowers.
That move brought total forgiveness approved by Biden up to $153 billion.
Republicans have been fiercely critical of those initiatives by the administration.
“Millions of Americans who responsibly paid their loans or chose not to pursue higher education will now be responsible for repaying the loans of others,” Ernst and Letlow groused about the cancellation program.
Meanwhile, FAFSA, which is used by roughly 17 million aspiring students as well as over 5,500 colleges and universities, has been battered with mishaps in its overhaul.
Congress approved legislation in the FAFSA Simplification Act to simplify and streamline the form, which is used to determine student eligibility for financial aid at thousands of colleges and universities across the country.
FAFSA did a soft launch of its overhaul on Dec. 30, 2023. Notably, that was three months late as FAFSA is typically made available on Oct. 1 so that students have sufficient time to complete it.
Delays caused by a handful of significant technical issues have fueled uncertainty for millions of prospective students over their enrollment status.
Last month, Education Secretary Miguel Cardona reached out to colleges and universities, encouraging them to “reconsider aid application deadlines” to ensure that “all students have time to submit and correct their FAFSA forms.”
Some of these troubles still persist days out from the May 1 National College Decision Day.
Ernst and Letlow are calling for the Education Department’s inspector general to conduct a review of FSA’s use of funds for the FAFSA overhaul, produce an “itemized accounting” of administrative expenses for student loan forgiveness and the FAFSA Simplification Act, as well as compile data on the number of full-time employees dedicated to FAFSA reform.
The Hawkeye State Republican has previously pushed for reforms on the student loan process, including a bill in 2023 to cancel changes to FAFSA that affected aid to farm families and another bill to ensure students got an estimate of the interests they’d have to pay on loans.
