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Led by Massachusetts Attorney General Maura Healey, 18 states and the District of Columbia filed a lawsuit against Education Secretary Betsy DeVos Thursday seeking to have borrower defense to repayment regulations enforced by the department.
The borrower-defense rule, which was finalized by the Obama administration last year, provides a process for students to have their federal loans discharged if they are defrauded by their school. DeVos announced last month that she would suspend enforcement of the regulations and seek to overhaul them through a negotiated rule-making process.
The attorneys general argued in the lawsuit that she violated federal law in delaying the rule. DeVos justified the delay by citing pending litigation challenging the rule filed by a California association of for-profit colleges. But the attorneys general argued that the case was a "mere pretext for repealing the rule and replacing it with a new rule that will remove or dilute student rights and protections."
In a conference call with reporters, Healey said the Trump administration and DeVos have sided with the for-profit sector over students since "day one" and that borrower defense would protect students and taxpayers.
Liz Hill, a spokeswoman for DeVos, said in a statement that the lawsuit brought by the Democratic attorneys general was "ideologically driven." And she said the challenge from the California for-profits raised "serious and credible charges" regarding the rule.
"The borrower-defense regulations suffer from substantive and procedural flaws that need to be considered before imposing new burdens on regulated parties that will come at a cost to taxpayers of $14.9 billion in the next 10 years," she said. "That is why the secretary decided it was time to take a step back and hit pause on these regulations until this case has been decided in court and to make sure these rules achieve their purpose: helping harmed students."
In a separate lawsuit Thursday, Public Citizen and the Project on Predatory Student Lending sued the department over the borrower-defense delay on behalf of two students who attended the for-profit New England Art Institute in Massachusetts.
