After congressional leaders and the White House failed to reach a deal on a COVID-19 supplemental funding package, President Donald Trump issued four executive orders on Aug. 8 seeking to address the economic problems exacerbated by the coronavirus pandemic.
The “Memorandum on Continued Student Loan Payment Relief During the COVID-19 Pandemic” extends the current moratorium on interest accrual and student loan payments established in the Coronavirus Aid, Relief, and. Economic Security Act (CARES, P.L. 116-136), currently set to expire on Sept. 30, through Dec. 31, 2020.
Previously, the House passed the Heroes Act (H.R. 6800), which would extend the student loan repayment moratorium through Sept. 30, 2021, while Senate Republicans introduced the Safely Back to School and Back to Work Act (S. 4322) as part of the Health Education and Liability Protection and Schools (HEALS) Act, which would only allow borrowers who aren’t earning income to be eligible for zero-dollar student payments [see Washington Highlights, July 24].
While the executive order continues the policy of student loan relief from the CARES Act, it does not extend all of the student loan relief provisions. Notably, the order does not reference the provision of the CARES Act that allows deferred payments to be eligible for public service loan forgiveness (PSLF), which means that deferred payments made after Sept. 30 do not count toward PSLF.
Additionally, the president issued executive orders addressing the pandemic’s economic impact, providing enhanced unemployment insurance of which $100 would need to be provided by the state, directing administration officials to consider and examine eviction protections for renters, and deferring payroll tax obligations. Some stakeholders have raised concerns that taxpayers would still be responsible to pay the taxes once the deferment ended and that the payroll tax deferment could ultimately have a possible impact on the health of the Medicare and Social Security trust funds.