Sen. Pamela Althoff (R-McHenry) argued against overriding Gov. Bruce Rauner's veto of the Student Loan Servicing Rights bill during Senate debate, saying the measure misses the problem.
Althoff said the legislation, SB1351 sponsored by Sen. Daniel Biss (D- Skokie) to address the conduct of student loan services and private collection tactics, will make no real difference in the student loan debt crisis in Illinois.
“I really admire the idea and concept behind this piece of legislation, but want we really want to do is address the burdening debt that most of our students are facing as moving on to a job,” Althoff said. “In no way does this legislation let us control the interest of loan or the length of time; it just says these service providers have to lay out all options and say this one might be good for the student."
Althoff asked Biss about the monetary incentives given to service providers, to which he explained service providers churn through cases as quickly as possible to increase their own overhead and profits. While sympathetic to Illinois residents having horrendous loans and difficulty paying them back, Althoff said SB1351 does not address that important issue.
“I really believe this piece of legislation doesn’t address the largest complaint that most of these individuals have with this type of loan, and that is the ability to reconstruct this type of loan,” Althoff said. “All it does is require 20 service providers to ensure they provide as much information to the student as to what program is better for them. My contention is we would be better served if we educated those individuals and let them know what all of these programs provide.”
She called the bill confusing.
“I really think you need to look at these seriously and how it is going to be interpreted by your constituents,” Althoff said. “I believe most will think we are correcting the debt problem. and I don’t think this legislation goes that far.”
After the Senate voted to override Rauner's veto of SB1351, the House concurred and the measure became law.
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