Negotiators were able to reach consensus on only a few issues during the third and final negotiated rulemaking session for student loan debt relief held by the Department of Education earlier this week. Ahead of the final session, the Department released its updated draft regulatory text reflecting input gleaned from negotiators during the first two sessions.

After multiple rounds of negotiations, the committee ultimately reached consensus on only a handful of the proposed regulations. Among the most contentious topics were the Department’s lack of regulatory language on which financial hardships would qualify borrowers for forgiveness and the proposed caps of either $10,000 or $20,000 on the total amount of forgiveness for the categories of loans under discussion by the negotiators.

The first day of the session was centered on strengthening the Department’s waiver authority to provide debt relief to student loan borrowers, and amendments the Department made to its proposed forgiveness for borrowers enrolled in income-driven repayment plans that limit relief to a maximum of $20,000. Negotiators raised concerns with the changes, noting that such a limit on the amount of potential relief arbitrarily constrains the Department’s ability to provide relief to borrowers, particularly lower-income borrowers and those who have seen interest growth outpace their payments toward their principal balance. These objections largely mirrored comments made in a recent letter to the Department signed by several Members of Congress, led by Senator Elizabeth Warren (D-MA) and Rep. Ayanna Pressley (D-MA), both of whom provided public comment at the end of the day.

The second day of negotiations continued the prior day’s discussion, with negotiators stressing the need for the Department to go much further in its proposed amounts of loan relief so as to provide meaningful loan forgiveness.

In the final hour of the day, the discussion moved to more clearly defining “hardship,” the primary focus of the second session last month. Discussion was preceded by a presentation from Dalié Jiménez, who leads the Student Loan Law Initiative at the University of California, Irvine. The presentation noted that relieving burdens associated with student debt would address concerns in six different policy areas: reduced credit scores; reduced homeownership; increased credit utilization; increased severe delinquency; increased adverse legal proceedings; and decreased auto loan amortization.

However, despite the Department providing revised regulatory language prior to the session on its waiver authority and eligibility requirements, the agency refrained from providing draft language for its hardship proposal. This led to some negotiators expressing frustration that they did not believe the Department was providing enough information or time for negotiators to adequately respond to the Department’s outstanding questions.

To better address the hardship question, negotiators pushed the Department to extend the negotiated rulemaking with another session early next year. While the Department would not commit to an extension, it appeared open to considering one but explained there would be procedural hurdles, such as publishing a notice in the federal register, that would delay any proposed additional session. In either case, the expectation is for the Department to release its Notice of Proposed Rulemaking (NPRM) sometime next May, though its negotiator confirmed that the agency would like to publish the NPRM sooner, if possible.