After overseeing the botched introduction of a new FAFSA, the COO for Federal Student Aid is standing down amid criticisms and controversy.
COO Standing Down
The chief operating officer for Federal Student Aid in the US will be leaving his position by the end of June, according to an announcement from the Department of Education on Friday.
Failed Aid Policy
Richard Cordray’s departure comes in the wake of a failed college financial aid policy which has seen Cordray on the receiving end of massive criticisms. However, Secretary of Education Miguel Cardona gave a stellar recounting of Cordray’s work when announcing the departure.
A Gracious Farwell
“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,” the statement read. “It’s no exaggeration to say that Rich helped change millions of lives for the better.”
Redesigned FAFSA
The controversial policy, which may have played a part in Cordray’s departure, was a redesigned version of the Free Application for Federal Student Aid (FAFSA), the college financial aid form.
Millions Left in the Lurch
Delays and technical problems with the form and application process meant that millions of students were left waiting for news on how much aid they would receive, leaving some uncertain of whether they would be able to enroll at all.
Inaccessible for Week
Though the forms technically came out in January, technical issues made them inaccessible to students for weeks. Vital financial aid information usually sent to colleges by January was also pushed back to March.
Administrators Left Scrambling
These issues left college staff rushing to get aid approved and to have calculations sent to worried students.
Condemned by Many
As the head overseer of the new application, Cordray has been condemned by affected students, college administrators, and Republican members of Congress, many of whom had pushed for Cordray’s resignation.
From Consumer Protection to Student Finances
Cordray began working for the FSA in 2021, after formerly serving as the head of the Consumer Financial Protection Bureau. While the FSA flies under the radar compared to many other federal offices, it’s an important one.
$1.6 Trillion Loan Portfolio
The FSA handles the country’s $1.6 trillion student loan portfolio and is entirely responsible for allocating financial aid to colleges. It also handles loan payments, collections, repayment plans, and more.
A Win for Democrats
Despite having no formal experience in education programs, his appointment was hailed as a win by Democrats and the Biden administration.
Congressional Hearing Held
However, this year’s Federal Student Aid debacle saw Cordray become the center of a congressional hearing by the House Committee on Education and the Workforce.
“The Professional Price Would be Steep”
“If there was a financial aid director, or even a college president, that delayed financial aid on their campus for up to six months, the professional price that would be paid for that would be pretty steep,” Justin Draeger, president of the National Association of Student Financial Aid Administrators, said in reference to Cordray.
“He Must Go”
Republican Rep. Virginia Foxx, who led the House Committee, was far more blunt in a social media post following the hearing. “It’s time for Richard Cordray to go,” she wrote.
Too Focused on Loan Relief
Some Republican lawmakers and Education Department officials have claimed that the serious oversights and blunders involved in the redesigned FAFSA were a direct result of Cordray’s preoccupation with student loan relief efforts.
$400 Million Plan
Under the Biden administration, Education Secretary Cardrona has been focused on implementing the president’s $400 million debt forgiveness plan, which was struck down by the Supreme Court last year.
Neglecting Vulnerable Students
Education advocates have argued that the focus on loan relief and the neglect of essential aid has disproportionately impacted economically vulnerable students. Some have also argued that the premature end of Cordray’s tenure would make the situation worse.
“The Worst Time for Change”
“This is the worst time for a change in management and leadership to happen,” said Brittani Williams, who works on advocacy, policy, and research at the student advocacy organization Generation Hope. “This crisis will turn away students from matriculating.”
The Transition of Leadership
Cordray has agreed to remain in the position until June, to ease the transition of leadership. He also released a statement of his own announcing his departure, and celebrating some of the milestones of his career with the FSA.
Loans for More Than 4 Million
“Over my tenure, we provided student loan forgiveness to more than 4,000,000 borrowers and their families;” he wrote. “We made it easier for people to apply for and manage federal student aid; and took strong actions to hold schools accountable for defrauding students.”
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The content of this article is for informational purposes only and does not constitute or replace professional financial advice.
