Not sure who House Republicans had in mind when they came up with the higher-education targeted PROSPER (Promoting Real Opportunity, Success and Prosperity through Education Reform Act) Act, H.R. 4508 – but a close look suggests it might be financial institutions and for-profit colleges, rather than students, who would be prospering.

In December 2017, the 590-page PROSPER Act cleared the House Committee on Education, with NO hearings. The higher education community’s calls for additional time and input went unheeded, and Democrats say they were not included in any aspect of drafting the bill.

The bill is a monstrous overhaul of the existing student loan program. It would end the Public Service Loan Forgiveness Program, under which teachers, social workers, and public defenders who work for the government and other non-profits now can qualify for student loan forgiveness after 10 years. It would also end subsidized student loans that permit low-income students to avoid interest while in school. In addition, it would require a minimum loan repayment, even for students at or under 150% of poverty level, who now have monthly payments of $0. 

The bill’s supporters point to its provisions for using grants to incentivize graduation in four years, abolishing loan origination fees, and expanding the work-study program for low-income students. The conservative Heritage Foundation claims that “[s]tudents and taxpayers win in the scenario where you have private lenders actually competing in the market, and ultimately we would hope that puts more pressure on inflated tuition prices.” However, an analysis by the American Council on Education – the nation’s most influential, respected, and visible higher education association – says an undergrad who borrows $19,000 over four years and makes payments on time would see a 44% increase in the cost of the loan if subsidies were eliminated under the PROSPER Act. A student who borrows $23,000 would experience a 56% increase. Nearly 6 million students would feel this effect.

PROSPER would also eliminate current safeguards that protect students from predatory lenders. It nixes the “90/10” rule, which bans for-profit institutions from collecting more than 90% of their revenue from federal aid. It would abolish the gainful employment regulation, which requires for-profit institutions  – like Trump U – to meet established debt-to-income ratios for students or risk losing federal financial aid. And it would remove states’ ability to oversee online schools and hold student loan providers accountable.

You’d think legislation this sweeping shouldn’t be rushed through in secrecy, but should rather be carefully weighed in a bipartisan fashion with expert input, time, and care. But sadly, this isn’t our first Rodeo; we’ve come to expect this rush-it-through bill behavior from the GOP (e.g. the tax scam). But it ain’t over yet.

What you can do:

It’s time for us to get loud about this legislation that would make it even harder for students to prosper. California Attorney General Xavier Becerra announced on March 18 that he has joined the attorneys general of New York, Colorado, Connecticut, Delaware, Hawaii, Illinois, Iowa, Kansas, Kentucky, Maine, Maryland, Massachusetts, Minnesota, Mississippi, Montana, Nebraska, New Mexico, New Jersey, North Carolina, Oklahoma, Oregon, Pennsylvania, Rhode Island, Tennessee, Utah, Vermont, Virginia, Washington and the District of Columbia to oppose the bill. Ask your MoC to join the volley of voices opposing the PROSPER Act (H.R. 4508).

What to say:

My name is ________________, my zip code is _________ and I’m a member of Indivisible East Bay.  I’m calling to express my opposition to the PROSPER Act. It will make it harder for students, especially low-income students, to repay their loans, and would remove safeguards that protect students from predatory lenders. I’m asking you to speak out against this hastily drafted bill that has potential to block access to higher education for millions of students.

  • Sen. Dianne Feinstein: (email); (415) 393-0707 • DC: (202) 224-3841
  • Sen. Kamala Harris: (email); (415) 355-9041 • DC: (202) 224-3553
  • Rep. Mark DeSaulnier: (email); (510) 620-1000 DC: (202) 225-2095
  • Rep. Barbara Lee: (email); (510) 763-0370 DC: (202) 225-2661
  • Rep. Eric Swalwell: (email); (510) 370-3322 DC: (202) 225-5065

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