Taxpayer group comments and meeting request re: RIN 1840-AD19

9/28/2016
Administrator Howard Shelanski
Office of Information and Regulatory Affairs
725 17th Street, NW
Washington, DC 20503
Dear Administrator Shelanski:
We are writing on behalf of taxpayers, millions of whom are members and supporters of our
organizations, who will be forced to pay billions of dollars in discharged student loans under the proposed
Department of Education (ED) Borrower Defense to Repayment Regulations (BDTR) now under review by
the Office of Information and Regulatory Affairs (RIN: 1840-AD19).
The proposed rule would create a stampede to file claims for loan forgiveness based on a newly
broadened, vague standard requiring only that a plaintiff allege a school made a substantial
misrepresentation. This overly broad phrase is defined as a statement or omission with a likelihood
or tendency to mislead under the circumstances.
The existing rules were designed to allow students to sue for loan forgiveness when they were victims of
intentional fraud or another violation of state law. The proposed standard is so vague that complaints will
proliferate based on innocent errors and alleged misunderstandings with a significant portion of the
costs borne by federal taxpayers.
The EDs own analysis in the proposed rule found a net budget impact in costs over the 2017-2026 loan
cohorts ranging between $1.997 billion in the lowest impact scenario to $42.698 billion in the highest
impact scenario.
This shockingly imprecise estimate suggests the department is incapable of reasonably estimating what
the ultimate costs to taxpayers will be and indeed there is significant risk that the costs could exceed
the $43 billion top of their range.
According to the Wall Street Journal, Credit Suisse analysts warned the proposal would inspire a cottage
industry of attorneys poring over advertising by colleges, and could force the closure of many small
schools.
In theory a student could say, I took English 101 and you didnt teach me Shakespeare and the course
description said youd provide a solid foundation in Western literature, David Baime of the American
Association of Community Colleges told the Journal.
Such an enormous commitment of federal taxpayer dollars should not be made through agency
rulemaking without an express directive from Congress, and it certainly should not be made without a far
more rigorous analysis and estimate of what the costs to taxpayers will end up being that the
Department of Education has conducted to date.
We formally request that a new analysis of the proposed regulation be conducted, independent of the
Department of Education, in order to more precisely determine the expected economic impact of this
rule, and that finalization and implementation of the regulation be delayed until such an analysis is
completed.
We further request a meeting with you or your designee to discuss these concerns.

Sincerely,
Melissa Ortiz
Founder
Able Americans
Phil Kerpen
President
American Commitment
Sean Noble
President
American Encore
Brent Gardner
Vice President of Government Affairs
Americans for Prosperity
Grover Norquist
President
Americans for Tax Reform
Tim Lee
Senior Vice President of Legal and Public Affairs
Center for Individual Freedom
George Landrith
President
Frontiers of Freedom
Andrew Langer
President
Institute for Liberty
Seton Motley
President
Less Government
Brandon Arnold
Executive Vice President
National Taxpayers Union
David Williams
President
Taxpayers Protection Alliance
Jenny Beth Martin
Co-Founder
Tea Party Patriots