“We will leave no stone unturned in the fight to fix a broken student loan system,” Education Secretary Miguel Cardona said in unveiling the plan.
The proposal will be discussed at a public hearing next Thursday and Friday of a federal regulatory panel. The Department of Education previously announced plans to formally release the plans for public comment in May.
The latest plan is the largest part of Biden’s Plan B strategy to cancel large swaths of student debt following the Supreme Court’s decision last summer to overturn his first attempt to cancel up to $400 billion in unpaid debt.
“We’re trying to figure out how to be as broad as possible within the confines of the law and the court’s decision,” a senior administration official told reporters Thursday, calling the latest proposal “pretty broad and oriented toward the future”.
Officials declined to release specific data on how many borrowers would be covered by the proposal. An Education Department official said only that this would represent a “significant number of borrowers.”
The department’s proposal hints at likely legal challenges that will arise from Biden’s upcoming debt relief package. The draft plan states that in cases where borrowers are experiencing hardship and are unlikely to repay their loans, “the costs of recovering the full amount of debt are not justified by the expected benefits of continued debt recovery.” the entire debt.
The latest plan comes after the Biden administration faced months of pressure from congressional Democrats and student debt activists, disappointed that a previous round of public hearings did not include a broad category of borrowers in difficulty.
The administration has already said it is considering canceling debt for distinct categories of borrowers, such as those whose balances have ballooned due to interest or those who attended poorly performing college programs.