Biden’s student loan chief to depart as mass relief plan looms
Rich Cordray, the Biden administration’s top student loan official who has been a key ally of progressives pushing for debt relief, will leave the Education Department at the end of June, the agency confirmed on Friday.
Cordray’s departure comes as the administration has been scrambling to recover from its troubled rollout of a new student aid system that delayed college financial aid offers for millions of families this spring and drew bipartisan criticism in Congress.
He will also be leaving as the Education Department faces pressure over the coming months to deliver on President Joe Biden’s aspirations to cancel student debt for tens of millions of Americans before the November election.
Cordray, the former head of the Consumer Financial Protection Bureau, has served as head of the department’s Office of Federal Student Aid since May 2021 when Education Secretary Miguel Cardona appointed him for a three-year term, which expires next week.
“I have written to the Secretary to confirm that I will not be continuing for another three-year term,” Cordray wrote in a message to staff that was obtained by POLITICO. “We have agreed, however, that I will continue to fulfill my current duties for a transitional period as the Department considers the longer term.”
In a statement, Cardona said Cordray would stay on through June and praised his “tireless work and commitment to provide the service that our students, families, and institutions deserve.”
“We are grateful for Rich Cordray’s three years of service, in which he accomplished more transformational changes to the student aid system than any of his predecessors,” Cardona said. He did not identify who he would appoint as Cordray's successor.
James Kvaal, the undersecretary of education who oversees student loans, praised Cordray’s tenure. “Rich transformed student loan policies that were only paper promises to actual help for millions of people in need,” he said.
Cordray brought to the role—FSA’s chief operating officer—a significantly higher profile than any previous occupant of the office. As a former Ohio attorney general and gubernatorial candidate, Cordray stood out among a line of other student aid chiefs who mostly came from operational roles in the financial services industry experience or other managerial posts.
As head of the office, Cordray was responsible for managing the nation’s $1.5 trillion student loan portfolio through the unprecedented pandemic-related freeze on most federal student loan payments, which expired in October after three-and-a-half years.
Most controversial, however, was Cordray’s leadership of the Office for Federal Student Aid amid its disastrous implementation of a bipartisan overhaul of the federal financial aid process that Congress passed in the waning days of the Trump administration.
The new Free Application for Federal Student Aid, or FAFSA, was meant to provide a simpler, easier experience for millions of families. But the years-long technology project was months behind schedule and failed to work when it launched earlier this year.
The Education Department for months could not process millions of federal financial aid applications and is in the process of re-processing millions more that were processed incorrectly.
Republicans have been livid over the FAFSA debacle, which they’ve blamed on the Biden administration focusing on student debt relief at the expense of other projects.
Rep. Virginia Foxx, the chair of the House education committee, earlier this month called on Cordray to resign over his management of the FAFSA project.
Cordray oversaw the administration’s implementation of student loan relief, including the mass debt-cancellation program that was struck down by the Supreme Court as well as various other actions that have separately canceled about $153 billion for more than 4 million student loan borrowers.
He cracked down and penalized some of the student loan servicers working for the Education Department even as he also awarded a new round of contracts to the companies. He was also forced to curtail customer service for borrowers amid budget cuts.
Cordray also revived the department’s student aid enforcement unit targeting misconduct at colleges and universities, especially for-profit and online schools. And he levied record, multimillion-dollar fines against Grand Canyon University over alleged misrepresentations to students and against Liberty University over campus safety violations.
CORRECTION: A previous version of this story did not make clear that Grand Canyon University disputes the basis for the Education Department’s fine against the school.
