FOR IMMEDIATE RELEASE
MAY 13, 2022
Statement from The Campaign for California Borrowers’ Rights in Response to Governor Newsom’s May California Budget Revise
The Campaign for California Borrowers’ Rights is the statewide coalition of students, higher education advocates, and borrower protection organizations.
(SACRAMENTO, CA) - Today, Governor Newsom released his May California budget revision. The Governor’s budget revision continues to invest $10 million in statewide student borrower assistance programs through the Department of Financial Protection and Innovation (DFPI).
There are nearly four million Californians with a total of over $140 billion in student loan debt. Federal student loan payments are currently set to resume in September after more than two years and over 60 percent of borrowers report they are not ready for payments to resume.1 There is also a once-in-a-generation opportunity for public service workers to access Public Service Loan Forgiveness (PSLF) who were previously ineligible, through a limited PSLF waiver with a deadline of October 31, 2022 that borrowers must apply for. Increased funding for DFPI will reach qualified borrowers through outreach and enrollment assistance for the upcoming October deadline. This upfront investment will also increase Californians’ awareness of DFPI as a resource and will build out a network for direct service providers across the state that will meet borrowers’ needs for years to come.
In response, the California Campaign for Borrowers’ Rights issued the following statement:
“We thank Governor Newsom for supporting student borrowers. However, in a year following a global pandemic and uncertainty, especially for the state’s 4.4 million student borrowers, tripling the Department of Financial Protection and Innovation’s (DFPI) proposed $10 million allocation to $30 million will allow the state’s leading student borrower protection agency to properly conduct statewide outreach, education, and assistance efforts, given the magnitude of the student debt crisis, recent reforms to the student loan system, and the exiting of student loan servicers from the marketplace.” “Each dollar invested in student loan support systems will leverage massive savings for individual borrowers, in terms of loan forgiveness and affordable payments, that will improve individuals’ lives and will recirculate into the local economy. It is time for California to lead the nation in crucial outreach and education to those with student loan debt and allow the state’s millions of student borrowers to reach a debt-free life. We call on Governor Newsom and the California Legislature to allocate $30 million to DFPI to conduct student loan borrower outreach and education.”
###
Consumer Reports
Student Debt Crisis Center
NextGen California
Young Invincibles
Student Borrower Protection Center