Deans Concerned Over Loan Program Changes

Earlier this month, law deans and professors met in San Diego for the annual Association of American Law Schools (AALS) meeting to discuss how the GOP’s education bill may affect the future of the law education.

Staci Zaretsky, editor at Above The Law, reports that law deans expressed concern on how the bill would change public service loan forgiveness for law students.

“There’s an education bill pending in the House, and within that proposed legislation is a $28,500 annual cap on graduate borrowing,” Zaretsky says. “Given that average yearly tuition and fees at a private law school cost about $46,164, and average yearly tuition and fees at a public law school cost $26,264 for in-state students and $39,612 for out-of-state students, this would be absolutely catastrophic for law students who rely upon federal loans to debt-finance their legal studies.”

The Graduate PLUS Loan Program and PSLF

Since 2005, graduate students have been allowed to take out the full out-of-pocket cost of graduate tuition under the Graduate PLUS Loan program. According to US News, anyone who is a US citizen, enrolled in a graduate program at least half-time, and has minimally acceptable credit is eligible for the loan program.

The Public Service Loan Forgiveness program (PSLF), launched in 2007 under the Bush administration, promises loan forgiveness to people who work at non-profits or government jobs once they’ve made 10 years’ worth of payments, according to CNN Money.

However, legislation proposed in December by North Carolina Representative Virginia Foxx, current chair of the House Committee on Education and the Workforce, would cap annual borrowing amount for grad students at $28,500 annually. According to Inside Higher Ed, the proposed bill would also “change benefits for borrowers by altering income-driven repayment options and eliminating Public Service Loan Forgiveness.”

The GOP’s response

Rep. Virginia Foxx

Republicans argue that the PSLF program is costly for taxpayers. GOP lawmakers add that giving public workers special benefits on student loans is unfair.

“Our proposal offers the same deal for everyone regardless of occupation and puts downward market pressure on institutions to keep costs down,” a committee spokesman tells Inside Higher Ed. “We believe all work is valuable and should be held in the same high regard.”

In a New York Times article, a Republican committee aide, who spoke on the condition of anonymity, pointed to one benefit to the proposed bill.

“People weighing their graduate school options have to consider debt obligations and the prospects for a good-paying job after graduation,” the aide says. “Too often, students do not make informed decisions in this regard.”

In a recent Gallup Poll, 67% of Republicans said they have “some/very little confidence” in US colleges and universities. A Pew Research Center poll found that 58% of Republicans said colleges and universities had a negative effect on the country.

Law school officials express concern

Law school deans and officials, however, are concerned that the proposed bill could limit the opportunities currently available to law students.

Wendy Perdue is dean at the University of Richmond School of Law and incoming AALS president. Perdue tells Law.com that law deans are concerned about the future of legal education.

“I think the concern right now is the pending education bill that would dramatically limit access to loan funds for graduate students. The House bill, at the moment, caps graduate borrowing at $28,500 and would eliminate public service loan forgiveness, that’s of great concern to all law deans.”

Chris Chapman is president and CEO of AccessLex — a non-profit aimed at informing students of the economic realities of law school. Chapman tells Inside Higher Ed that capping graduate lending and eliminating PSLF would make it more difficult for underrepresented students to pursue a graduate education and a public service career.

“It would really take away a very strong benefit and strong tool to encourage graduates who go into public service professions,” he says. “Even more than that, it really eliminates the incentive to persist in the profession.”

For Perdue, she says that while she is concerned about the bill, she must remain optimistic.

“You can’t be a dean without being optimistic,” she tells Law.com. “Among deans, we are always hopeful about the future.”

Sources: Above The Law, Inside Higher Ed, Law.com, US News, CNN Money, The New York Times, Gallup, Pew Research Center