Winning on Student Loan Reform … From CT to MT

Across the country, student loan borrowers and their allies have been organizing to make college more affordable and push for state-level reforms that address the mountain of student debt that’s weighing down students and families. And they’re winning… all the way from Connecticut to Montana.

In Connecticut, where the 2015 legislative session ended at midnight on June 3rd, Alliance affiliate Connecticut Citizen Action Group (CCAG) co-convened and provided staff support for the Higher Ed, Not Debt – CT coalition, a coalition of community and labor allies that formed last fall and championed affordable higher ed and student loan reforms in the legislature this year.

CCAG’s work with the coalition – including releasing the Connecticut version of the Alliance’s A Mountain of Debt report last fall, mobilizing its grassroots membership through public events and calls to action, and driving under-the-dome engagement at the legislature – helped push some breakthrough wins on student loans before the session gaveled out.

The Alliance congratulates the Higher Ed, Not Debt – CT coalition for these exciting wins, including:

Passing a Student Loan Bill of Rights that gives borrowers somewhere to turn for help and gives the banking commissioner the authority to investigate and take action against bad-acting loan servicers. This bill of rights creates a dedicated student loan ombudsman position in the state Banking Department to review and act on borrower complaints, to compile and publicize complaint data, and to educate borrowers and the public about student loan issues. It establishes licensure requirements and standards of conduct for student loan servicers. And it authorizes the banking commissioner to conduct investigations and examinations and take enforcement action against servicers who violate licensing provisions.

Passing in-state tuition for DREAMERS – immigrant students who attend high school in Connecticut but, despite having residency in the state, have been barred from paying in-state tuition because of immigration status. With out-of-state tuition often coming in at triple in-state rates, this made the costs of higher education prohibitive for many. Passing in-state tuition is an important step toward justice and educational opportunity for immigrant students.

Passing a landmark student loan refinancing bill. This bill allows the Connecticut Higher Education Supplemental Loan Authority (CHESLA) to refinance qualifying student loans. Crucially, the bill gives CHESLA the authority to refinance private student loans (which often come with punitive interest rates) into public CHESLA loans with lower rates and better protections. This bill also reforms CHESLA’s lending practices to ensure that it provides more aid to low-income students who have the greatest financial need.

This progress in Connecticut is exciting. So is the news from Montana, where the Montana Organizing Project (MOP) has been collecting stories and organizing around student debt issues, too (MOP released the Montana edition of A Mountain of Debt last fall). This year, MOP took on a longshot fight in the legislature to roll back the criminalization of student debt – and won!

The criminalization of student debt has been a troubling – and growing – trend nationwide. Going into this year, 22 states (including Montana) had laws on the books that allow the state to revoke a state-issued professional license (like a nursing license) if a borrower defaults on student loans.

But Montana went even further: under a statute passed in 1997, the state could suspend a driver’s license indefinitely if a borrower failed to pay back student loans.

In a sprawling state like Montana where public transportation infrastructure is poor and driving is a practical necessity to get to work, members of the Montana Organizing Project concluded this law was just plain kicking people when they’re down… so they kicked into action to do something about it.

MOP engaged the state Department of Justice around the issue, analyzed the Montana Code to develop a fix, and worked to build support both inside and outside the legislature to reverse this punitive law. The resulting bill, HB 363, passed the Montana House and Senate with bi-partisan support and was signed into law by Montana Governor Steve Bullock – a promising victory for efforts to roll back the criminalization of student debt.

Hats off to the teams in Connecticut and Montana for winning these fights, and putting forward models that can inspire action and catalyze new campaigns for affordable higher education and student loan reform across the country.