In early 2022, Zero Debt Massachusetts established an annual legislative priority to push for an amendment to Section 13 of Chapter 30A of the Massachusetts General Laws, requiring that:
No agency, and no board of registration operating under the provisions of Chapter 112, may refuse to issue, revoke or refuse to renew any trade or professional license or certificate, registration or authority because of the failure of a individual on a student loan.
This legislative amendment, known as Bill H.4339, is intended to protect nearly one million Massachusetts student borrowers who are at risk of having their licenses denied, revoked, or denied renewal.
Unquestionably, the current student debt crisis has been exacerbated by the COVID pandemic; however, the higher education financing system is structured to benefit all-powerful credit institutions and squeeze the poor, young, and disadvantaged.
For example, one of the national policy decisions in favor of lending institutions included decreasing funding for public universities and offering student loans instead of scholarships previously available to needy students. Unsurprisingly, many predatory and for-profit financial institutions have taken the opportunity to invest in the unregulated higher education market.
A recent Business Insider article reported that “over the past decade, student loan companies have been accused of mismanagement and deception.” But instead of focusing on these questionable practices, the US Department of Education has put pressure on student borrowers. According to US News & World Report, “In the 1990s, […] the federal government has urged states to use their license revocation capabilities to stem the growing wave of student loan defaults.
Many states then enacted laws to suspend the professional and driver’s licenses of borrowers who failed to repay their student loans, enforcing these new laws with aggressive zeal. Between 2005 and 2015, Illinois alone suspended the licenses of 2,300 workers in 50 different professions, affecting more than 600 cosmetologists, 400 pharmacists, barbers and counselors. Surprisingly, in the face of the nursing shortage, Illinois also suspended the licenses of nearly 500 nurses.
Other states have followed suit: A New York Times investigation “identified at least 8,700 cases in which licenses were revoked” due to student loan default. The inquest detailed the case of a Nashville nurse whose sudden seizures prevented her from working. She defaulted on her loans. She then lost her license and the ability to work. This case is not exceptional.
Despite the extremely punitive nature of these laws and the zeal with which they were enforced, however, they have proven to be quite ineffective. For example, the Illinois Department of Financial and Professional Regulations could not determine the amount of student loan debt that was collected.
This petty and punitive measure, directed as it is at the most vulnerable segments of our population – low-income people, young people and constantly harassed communities of color, especially black women – prompted a writer for US News & World Report to poignantly ask: “If people are unable to work… how can they be expected to pay their debt?
In recognition of the injustice and punitive nature of these laws, pressure has been exerted from many places to demand their abolition and an appropriate response to the national student debt crisis. Borrowers’ unions and borrower advocates were the first to sound the alarm.
In Massachusetts, state Rep. Natalie Higgins of Leominster sponsored and led passage of the Professional License Protection Bill H.4339, which initially received strong support but is currently languishing in committee. Senate Ways and Means.
At this point, however, it is clear that the impact of the student debt crisis has disproportionately affected some of the most vulnerable members of society. And as long as there is legislation on the books that hangs like the sword of Damocles over the head of every student borrower, the state is perpetuating economic and racial injustice.
The Legislature must pass the Professional License Protection Bill H.4339 as soon as possible.
Claudio Martinez is executive director of Zero Debt Massachusetts.