Law Center Takes Heat for Loan Policy
Published: Tuesday, August 27, 2013
Updated: Tuesday, August 27, 2013 11:08
The Georgetown University Law Center received criticism for its Loan Repayment Assistance Program earlier this month.
Because the Law Center’s LRAP is funded with federal dollars, the university charges higher rates for tuition than is necessary, the Federal Education Budget Project at the New America Foundation Director Jason Delisle and program associate Alex Holt alleged in a post on the NAF website.
Currently, graduates who work for 10 years for the government, a nonprofit or in public service and make no more than $75,000 a year can have their loan repayments reimbursed by the university. Because of the 2007 Public Service Loan Forgiveness Program, any Grad PLUS loans remaining after that 10-year period are forgiven, so students who qualify for both programs and go into public service will receive a free education.
In 2011, Law Center Assistant Dean for Financial Aid Charles Pruett and Delaney Family professor of public interest law Philip Schrag said that a program such as Georgetown’s LRAP that is also tied to Public Service Loan Forgiveness can help increase donations to the school. It also allows students to pursue work in public service instead of choosing the private sector to repay debt.
But according to NAF, there is no cap on the amount of Grad PLUS loans that students can take out or on the amount of money that can be forgiven. As a result, the university is increasing tuition and using the money from federally funded student loans to pay for LRAP — in effect, paying the government back with taxpayer dollars.
“We’re not saying Georgetown is doing something illegal, and I’m not arguing it’s immoral — I think Georgetown is taking advantage of a program that has all the wrong incentives,” Holt told The Hoya.
However, in an Aug. 21 piece in the Chronicle of Higher Education, Law Center Dean William Treanor said that Georgetown was not circumventing the law.
“Our decision to provide loan assistance beyond what the federal program offers is not a ‘loophole’ in the federal program; it is a supplement to public support for our graduates who serve the public,” Treanor wrote.
Instead, Treanor argued that LRAP is funded primarily through alumni donations and by students who do not qualify for the program.
“In short, 90 percent of Georgetown Law students do not benefit from the program,” Treanor wrote. “Through their loan repayments, these graduates — not the federal government — are supporting our Loan Repayment Assistance Program.”
Although Treanor wrote that LRAP barely factors into the Law Center’s budget, Holt said Treanor’s response did not justify the increasingly higher tuition at Georgetown Law and other law schools across the country.
“The problem with this particular thing we’ve uncovered, it’s complicated and it’s easy to confuse people with public service, but at the end of the day, it allows Georgetown to continue increasing tuition without questioning whether it’s valued at that,” Holt said.
According to Holt, the problem of unaffordable tuition is systemic.
“We picked Georgetown because they were so open about what they were doing, but they’re definitely not the only ones doing it,” Holt said, citing similar programs at the University of California at Berkeley, Duke University and New York University.
Holt disputed Treanor’s claim that Law Center is committed to helping graduates who go into public service.
“My question would be, does [Treanor] really think that $160,000 in loan forgiveness is a reasonable number for the government to forgive?” Holt said. “I don’t think Georgetown is quite as fully in the public interest as they say. They like to mention their Jesuit-inspired mission, but that’s $160,000 their students are borrowing.”
Georgetown Vice President for Federal Relations Scott Fleming said he was unfamiliar with the program and declined to comment further.
Correction: Due to an editing error, an earlier version of this article incorrectly identified Georgetown Law professor Philip Schrag as the Law Center's assistant dean of financial aid. The assistant dean of financial aid is Charles Pruett.