DATE: 06/16/2022
TO: The Honorable Jose Medina
Chair, Assembly Committee on Higher Education
1020 N Street, Room 173
Sacramento, CA 95814
RE: House Resolution 118 (Bonta) California Student Debt Awareness Month - COSPONSOR
Dear Chair Medina,
I am writing to express our strong support for HR 118 (Bonta). As a proud co-sponsor of HR 118, we request your support in proclaiming August 2022 “California Student Debt Awareness Month.” The Student Debt Crisis Center, and our allies in the Campaign for California Borrowers’ Rights, represent millions of student loan borrowers, student groups, young people, consumers, teachers, non-profits, older borrowers, veterans, low-income communities, and communities of color.
We believe that public and private sector employers, especially state and local public service employers, can play an essential and proactive role in educating their employees about student loan repayment options, loan forgiveness programs, and consumer protections.
Californians carry over $145 billion in student loan debt today. This debt burden is compounded by an information gap that too often prevents borrowers from knowing about and accessing federal programs that could help. There are a myriad of federal programs that offer affordable repayment options and opportunities to have debts forgiven entirely. However, the system is complex, difficult to navigate, and fails to reach those who need the most support. The state can help close this gap with a simple, and effective, month-long education and awareness campaign that ensures borrowers across the state have the resources they need.
Education and awareness efforts are as critical as ever as borrowers recover from the economic shocks of the pandemic and pandemic-related relief is set to end. Roughly four million Californians have student debt and a large majority of those borrowers have had their payments paused for more than two years as part of the federal government’s pandemic relief. but that relief ends on August 31. The Federal Reserve warns that restarting payments will lead to a wave of loan delinquencies and defaults. Federal programs can ensure borrowers don’t fall behind on their loans but only if they have access to timely and actionable information.
That is precisely why we support establishing August 2022 as California Student Debt Awareness Month so that we can address the dire need for student loan information and assistance in a very concerted and strategic manner as borrowers prepare for loan payments to resume.
Education efforts are even more important for specific groups of borrowers. For example, studies have found that Black borrowers face the biggest challenges enrolling in affordable repayment programs and applying for loan forgiveness programs due to the confusing nature of the process. Awareness campaign is not only a solution to address student loan debt but it also helps address racial and gender inequities as well.
Secondly, it is imperative that we support public service workers, who contribute so much to our communities and sacrificed so much during the pandemic, in accessing loan forgiveness. The federal Public Service Loan Forgiveness (PSLF) program was created to provide public service workers with federal student loan debt relief in return for a decade of public service. But, unnecessary red tape blocked many nurses, teachers, social workers, and other public service workers from the debt relief promised to them by law. A new, temporary waiver announced in 2021 allows borrowers to apply under expanded rules, but the new deadline is October 31, 2022. State agencies, community groups, and businesses must work together to double our efforts to spread awareness of loan forgiveness opportunities among these everyday heroes.
The proposed California Student Debt Awareness Month is another step in continuing California’s leadership when it comes to the issue of student debt. This resolution adds to previous efforts by mobilizing businesses, nonprofit organizations, state agencies, and all employers to engage in outreach to their employees about student loan programs during the month of August.
We support the California Student Debt Awareness Month resolution because raising awareness will increase the number of Californians accessing federal repayment and loan forgiveness programs. For the above reasons and as co-sponsors in strong support, we request your “aye” vote on HR 118.
Sincerely,
Cody Hounanian
Executive Director