Senate Acts to Alleviate Student Debt, Increase Tuition Assistance

The New York State Senate passed a legislative package to increase the income eligibility for applicants to the state Tuition Assistance Program. The legislation will further reduce barriers to higher education by removing default interest, offering tuition assistance for high school programs, expediting Higher Education Services Corporation (HESC) eligibility determinations, excluding certain sums due from the definition of debt, requiring new employees to receive student loan repayment information, and requiring lenders to provide information to cosigner applicants about their rights. The legislative package continues the Senate Majority’s commitment to increasing access to higher education for every New York student, especially as New Yorkers grapple with the student debt crisis. The Majority’s efforts include “ full reimbursement to colleges for the TAP Gap, resulting in new funding in the amounts of $48.8 million to SUNY and $59.6 million to CUNY.” Read the Senate Majority’s full Press release.

“The importance of higher education for both the personal mobility of our students, and the economic health of our state could not be clearer. We as lawmakers have a responsibility to assist students in making informed decisions on their borrowing, and provide assistance to ensure that the cost of higher education is accessible to all who wish to pursue it,” Senate Majority Leader Andrea Stewart-Cousins said. “Student debt is a crippling burden on many New Yorkers already struggling to pay their bills during a period of inflation. While we wait for student debt relief from Washington, these bills make substantial steps to provide financial aid assistance and set our students up for success now and in the future.”  

Bill sponsor and Chair of the Committee on Higher Education, Senator Toby Ann Stavisky said, “Too many students graduate from college, starting their careers owing thousands of dollars in student loans and mortgaging their future. The first of two bills I am sponsoring would increase the income for TAP eligibility from $80,000 to $110,000. The second bill requires the Higher Education Service Corporation (HESC) to make a determination on applications within sixty days. These measures will provide relief for many working and middle-class families in New York.”

Components of the legislation include:

• Increase Income Eligibility Threshold For TAP: S.7916B, sponsored by Senator Toby Ann Stavisky, increases the income eligibility maximum for the Tuition Assistance Program from $80,000 to $110,000. This bill will expand eligibility of the Tuition Assistance Program to more families within New York State who need assistance in reducing the costs of college expenses.
• Sixty-Day Determination For Financial Eligibility: S.4449, sponsored by Senator Toby Ann Stavisky, directs the Higher Education Services Corporation to make a determination of financial eligibility within the first 60 days after the student financial aid application is received and complete. If HESC does not determine financial eligibility within 60 days, the student will be deemed eligible to receive aid for the semester the application was made. However, HESC is allowed one 30-day extension to make a decision if it notifies the institution in writing that additional time is required to review the case of an individual student.
• Removal Of Default Interest: S.7862, sponsored by Senator Jamaal Bailey, amends the definition of “debt” defined by the state finance law to exclude tuition, fees, room and board, student loans and all other related charges from the definition. By changing the definition of “debt”, the State will remove the 22 percent interest rate accrued from defaulting loans. This will remove the additional fees and costs that pile onto a student’s total debt, and decrease the amount of money borrowers pay overtime.
• Loan Repayment Information in Financial Aid Award Letter: S.664, sponsored by Senator James Sanders Jr., will provide students with detailed information on their student loan repayment which includes the estimated monthly payment. Prior to this bill, loan repayment options were not included in the financial aid award letters, and this enhancement will prepare students for the debt burden after they graduate.
• New Hire Student Loan Repayment Notice: S.859A, sponsored by Senator Andrew Gounardes, requires employers to provide new hires for entry-level positions or post-graduate internships with information on student loan repayment options. Providing this information at the onset of employment will help educate New Yorkers new to the workforce on the options available to them to help manage their student loans.
• Notice of Tuition Liability Policies: S.7914, sponsored by Senator John Liu, ensures all students at all levels of higher education are aware of the institution’s withdrawal policy and the impact that withdrawal has on tuition owed. This bill also informs students of any processes which may exempt students from tuition owed after withdrawal. Most institutions have policies in place that hold students fully liable for withdrawing from school leaving students with substantial tuition bills that they cannot afford to pay.
• Private Education Loan Protections: S.5136B, sponsored by Senator Kevin Thomas, requires lenders to provide information to cosigner applicants about their rights, annual notices regarding cosigner release, and timely notification if borrower has submitted an incomplete application. This bill seeks to help students with predatory practices from private education lenders.
• TAP For High School Programs: S.552A, sponsored by Senator Shelley Mayer, allows the Tuition Assistance Program to be applied to dual-credit high school courses accepted by a postsecondary degree program. The dual-credit course programs help high school students complete their college degrees quicker, and oftentimes at a lower cost. This bill will encourage the expansion of dual-credit programs in New York high schools.