WASHINGTON – A Government Accountability Office (GAO) report released today reveals that the Department of Education is denying 99 percent of student borrowers applying for loan forgiveness under the Temporary Expanded Public Service Loan Forgiveness Program (TEPSLF). Congress established the emergency TEPSLF program last year in response to extremely high denial rates for the original Public Loan Service Forgiveness (PSLF) program, giving the Department specific instructions to simplify and expand eligibility to approve more student borrowers within 60 days.
The GAO report, Improving the Temporary Expanded Process Could Help Reduce Borrower Confusion, shows that of the 54,184 applications received under TEPSLF, 661 were approved (1 percent) and 53,523 (99 percent) were denied. The report also reveals that of the $700 million appropriated by Congress for student loan forgiveness under TEPSLF, the Department has only spent $26.9 million.
“The GAO’s report reveals that the Education Department is failing to competently implement the Temporarily Expanded Public Service Loan Forgiveness program. More than a year ago, Congress gave the Department clear instructions and $700 million to simplify the Public Service Loan Forgiveness program, which incentivizes talented people to enter careers in public service. The Department’s failure to implement this program is mystifying and unacceptable,” said Chairman Robert C. “Bobby” Scott (VA-03).“Regardless of whether the administration supports the Public Service Loan Forgiveness program, the Constitution requires the executive branch to ‘take Care that the Laws be faithfully executed.’ This month, the Committee will hold a hearing to examine the issues raised in this report and remind the Department of its responsibility for ensuring that tens of thousands of dedicated public servants – including our nation’s teachers, first responders, servicemembers, and many others – receive the loan forgiveness they were promised.”
In 2007, the Public Service Loan Forgiveness (PSLF) program was founded to provide public servants—such as teachers and first responders—student loan debt relief after at least 10 years of payments. In 2018, after the GAO revealed the Department only approved 96 borrowers out of the 28,000 applications, Congress appropriated $700 million to create the Temporary Expanded Public Service Loan Forgiveness (TEPSLF) for those not eligible for PSLF.
“This report is yet another example of the Trump Administration failing student borrowers,” said Chairwoman Susan Davis (CA-53), Subcommittee on Higher Education and Workforce Investment. “The intent of Congress under the Public Service Loan Forgiveness program is clear: The Department of Education has an obligation to protect students, not lenders. This will only serve to discourage graduates from giving back to their communities in the name of public service. The Department needs to take immediate action to fix this problem.”
The GAO’s report concludes that the Department’s failure to establish a streamlined application process and inform student borrowers about their options is to blame for the high denial rates under TEPSLF. The report also concludes that the confusing application process is “not aligned with Education’s strategic goal to improve customer service to borrowers.”
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