August 25, 2017
To the Honorable
The Illinois Senate
I veto Senate Bill 1351, which seeks to create the Student Loan Servicing
the intent of this bill to support struggling student-loan borrowers is
laudable, the bill, as written, encroaches on federal government’s
responsibilities and would add confusion to the already complex student loan
legislation would require servicers to be licensed by the state, adding another
layer of Illinois state bureaucracy without any guarantee the change would
improve service. In fact, this requirement may push smaller servicers out of business.
The recent U.S. Department of Education decisions regarding student-loan
borrowers have been cause for concern. Therefore, my staff will continue to work
with the department and members of Congress to address these concerns as the
federal government moves to reauthorize the Higher Education Act.
do need additional support in understanding their loan repayment options, but
loan servicers are not the appropriate actors for the role. Instead of adding another
layer of state bureaucracy in the form of a student loan ombudsman, the General
Assembly should consider allocating those funds to nonprofit counselors who are
far more effective at advising students than any government agency.
are several important components of the Student Loan Bill of Rights contained
in SB 1351. Students should not be defrauded – purposely or through
incompetence – by their loan servicer. I urge the sponsors to work with members
of the Department of Education and my office to ensure a set of common-sense
student protections that will not conflict with evolving federal regulations
and to craft a more narrowly tailored bill to support student-loan borrowers in
Illinois. Therefore, pursuant to Section 9(b) of Article IV of the Illinois
Constitution of 1970, I hereby return Senate Bill 1351 entitled “AN ACT concerning
education,” with the foregoing objections, vetoed in its entirety.