Thousands of teachers could see loan debt disappear as the Education Department tries to correct a past mistake.
As mounting student debt continues to cripple young Americans, a select few may soon find relief. A recent expansion to a fix from the U.S. Department of Education means that thousands more teachers could soon find a huge debt burden lifted from their shoulders.
Since its creation in 2007, the Teacher Education Assistance for College and Higher Education Grant (TEACH) program has helped aspiring teachers pay for college. The federal grant requires that recipients commit to working in high-need subjects such as math or science in low-income schools for four years within an eight-year window.
Over 20,000 teachers have successfully completed the program since its creation, according to the Education Department. Many other grantees, however, had little to celebrate until a recent overhaul of the program.
A nearly yearlong investigation by NPR revealed that the TEACH program was a bureaucratic nightmare that resulted in grants converting into loans—with interest—for at least 94,000 recipients. Many public school teachers suddenly found themselves burdened with debts of $20,000 or more. The Education Department reported that over 60 percent of TEACH grant recipients had to repay the money as a loan. NPR’s investigation reportedly prompted the Education Department to conduct an extensive internal review of the program in May 2018.
How did this situation arise? The TEACH grant requires teachers to submit paperwork each year to certify their ongoing compliance with the grant’s rules. If a teacher missed a submission deadline—even by a single day—or forgot to sign and date part of a form, their grants converted into loans. The process was made even more complicated by requiring teachers to complete forms over the summer, when their supervisors, who had to sign off on forms, were often away on vacation. Moreover, certification reminders were often sent to outdated addresses. Even processing delays outside of a teacher’s control could result in this irreversible loan conversion.
Upon discovery of the loan change, teachers found it nearly impossible to receive any sort of leniency, even if they could provide proof of their completed or ongoing fulfillment of the teaching requirements. As a result, many otherwise qualified teachers either moved to non-grant-eligible schools or exited the teaching profession altogether, according to the NPR report.
Further mismanagement complicated matters. For example, many teachers said that call center staff told them not to even try to dispute the loss of their grants, suggesting that appeals were futile. Still, as of December 2018, more than 4,000 formal disputes had been filed by teachers who lost their grants due to late paperwork.
Even FedLoan, the company managing the program for the Education Department, recognized the problem as early as 2015 and asked the Department for the authority to change the loans back to grants. The Education Department called the certification form “too complicated or confusing” in at least one internal document, according to NPR.
The Education Department announced a “fix” to this issue in December 2018, stating that relief was available for any grantee who could prove that they had fulfilled or could fulfill the grant’s requirements. The Department will erase the debts of teachers who can prove four years of qualifying work, and it will refund them for any amount they have already paid into the system. Teachers who have not yet taught for the full four years will have their loans converted back into grants and will receive credit for any time spent teaching in qualifying schools, regardless of past paperwork issues, reported NPR.
This “reconsideration process” has already encountered obstacles, however. Because reconsiderations are not automatic, the Department has had trouble reaching affected parties, as many teachers have changed their physical and email addresses, for example. In addition, teachers find that some call center staff are unfamiliar with the new rules, and the paperwork remains confusing, noted NPR. As of August 2019, the official TEACH grant’s online page contains notices of the recent changes to the grant, directing site visitors to resources for relief.
Still, nearly 6,000 teachers have applied for relief since January, and fewer than 20 teachers have been denied as of May 2019, according to NPR.
The Department has also taken steps to protect future teachers through a process called “negotiated rulemaking,” in which government agencies and non-government stakeholders build consensus on a proposed rule, often to avoid litigation. Under the negotiated agreement, TEACH grants will no longer automatically convert into loans due to late or incomplete annual paperwork. The Department is extending deadlines and redesigning the certification process to reduce paperwork issues. NPR notes that the Education Department will also help teachers whose credit scores dropped when they defaulted on the loans.
Despite these efforts, teachers approaching the eight-year certification window may find it hard to complete or submit their certification requirements. The Department already has a policy allowing it to suspend the eight-year window in special circumstances—although it has thus far declined to use this congressionally approved power. Congress signaled its intent to “stop the clock” retroactively at the time that each teacher’s grant converted, but many teachers will still find it hard to meet the time requirements, especially if they have changed schools or stopped teaching, said NPR.
Public Citizen, a consumer advocacy group, and others have pushed for greater leniency, including a reduction in the four-year teaching requirement. “For people who were converted eight, nine, 10 years ago,” says Public Citizen attorney Patrick Llewellyn, asking them to quit their current job and find another one “is a lot to ask…if they are doing something completely different.”
Instructions for how to request TEACH grant reconsideration can be found online at the Education Department’s website.