The Biden administration is planning to administer widespread relief for former Corinthian Colleges students on Thursday, multiple sources told The Hill exclusively, a move that progressives see as inching towards their goal of broader student loan debt forgiveness.
Vice President Harris will attend an event around the announcement during the afternoon, according to two sources directly familiar with the plans.
The impending action could touch several hundred thousand borrowers that attended the now-defunct for-profit chain and could include as much as $10 billion to $20 billion in collective debt, according to an internal estimate by an independent agency.
Corinthian Colleges shut down in 2015 after it faced multiple investigations and lawsuits for defrauding students out of millions in federally backed loans. Since then, advocates like Sen. Elizabeth Warren (D-Mass.) have called on the Education Department to provide relief to former students who faced some form of debt collection.
Harris has been heavily involved in lawsuits against Corinthian Colleges.
In 2016, when she was attorney general in California, her office obtained a $1.1 billion judgment against Corinthian Colleges for “their predatory and unlawful practices.”
Beginning in 2013, she filed suits seeking to stop the practices left thousands of students in debt with worthless degrees.
A second source who is aware of the forthcoming action but not authorized to speak on the record said advocates plan to use the declaration to “build momentum” for larger-scale student debt cancellation and to promote the role grassroots politics is playing to generate results during Biden’s first term in office.
“Activism did this,” the second source said.
The White House has indicated that it is nearing a decision on student loan debt forgiveness, zeroing in on canceling $10,000 per borrower, but has not said that a decision is finalized. Several sources told The Hill in late April that Biden was looking to cancel at least $10,000 per borrower, the amount the president had supported canceling in the 2020 campaign although progressives have called for $50,000 per borrower.
“Good move by the White House but need to go broader,” said a third Democratic source in touch with top progressive lawmakers in the Senate and House.
For all the excitement from outside activists, some Democrats were already expressing skepticism privately as the news traveled through progressive circles Wednesday afternoon.
“Corinthian wouldn’t be viewed as a good first step. [It] would be viewed as them doing something that should have happened years ago because they were the victims of fraud,” said a fourth Democrat working on student debt issues.
The White House did not immediately respond to a request for comment.
National Economic Council Director Brian Deese on Tuesday told reporters Biden “hasn’t made any decision on that policy” when asked about the president’s potential plan to forgive $10,000 in student debt.
Biden in April extended the pandemic moratorium on federal student loans and interest accrual through August. The pause on student loan payments was first enacted in March 2020 under President Trump and has been extended multiple times since.
Updated at 5:27 p.m.