Senate Republicans Join Democrats in Rejecting DeVos’s Borrower-Defense Rules

Alex Wong, Getty Images

The U.S. Senate on Wednesday sent a rare bipartisan rebuke to Education Secretary Betsy DeVos.

Senators voted 53 to 42 on a bill to revoke the Education Department’s new “borrower defense” regulations, which are set to take effect in July. Ten Republicans in that chamber’s majority voted to approve the legislation, sponsored by Sen. Dick Durbin, Democrat of Illinois.

The U.S. House of Representatives approved a companion bill in January, with six Republicans joining 225 Democrats who hold the majority in that chamber. The legislation now heads to the desk of President Trump, who has threatened to veto it. If he does, it would be his first on a piece of domestic legislation.

The regulations govern how borrowers can apply to have their student loans forgiven if they are defrauded by a college or if their college closes suddenly and they do not transfer their credits to another institution. The department first devised the regulations under the administration of President Barack Obama in the wake of the closures of major for-profit colleges like Corinthian and ITT.

By the time the regulations took effect, in July 2017, Trump had taken office, and the Education Department announced that it would seek to delay the enforcement of the regulations as well as to rewrite them. A federal judge eventually ruled that the department had to follow the existing rules, but the new rules are scheduled to take effect this summer. Those rules are what the Senate voted on Wednesday to revoke.

If the legislation is enacted, the policy would revert to the original Obama-era rules. If the bill is vetoed, as expected, Democrats would be unlikely to muster the two-thirds majority needed to overturn the president’s action.

‘Free Money’

DeVos said at a 2017 conference that the initial rules made it too easy for a student-loan borrower to “raise his or her hands to be entitled to so-called free money.”

The new rules would make it harder for individual students to prove their claims of fraud against colleges, by barring class-action lawsuits by students, raising the burden of proof for fraud claims, and removing their ability to appeal a claim that is denied by the Education Department.

But some influential groups of military veterans have lobbied to reject the rules. That may have swayed some Republican senators in Wednesday’s vote.

“With a bipartisan vote today, the Senate is one step closer to ensuring that veterans and student borrowers who were defrauded by their schools will still have the opportunity to seek financial relief,” Durbin said in a news release on Tuesday, after a vote to advance the bill for final consideration. “These students were lied to by predatory for-profit schools and are drowning in student-loan debt because of it.”

Active-duty members of the military as well as veterans have been heavily recruited by for-profit colleges, which rely on tuition money from the GI Bill to help diversify their revenues and avoid penalties under the so-called 90/10 rule. Under that rule, colleges must receive more than 10 percent of their tuition revenue from money outside the federal Title IV student-aid programs. Money from the GI Bill does not count as federal student aid under that formula.

Young Invincibles, a left-leaning group that has opposed the new rules, argued that the bill’s bipartisan support should be enough for the president to reconsider his veto threat.

“In a Congress that can’t agree on much of anything, the fact that bipartisan majorities of both chambers would strike down this rule should be a clear sign to the Trump administration that they need to reverse course,” Kyle Southern, the group’s higher-education policy and advocacy director, said in a news release.