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Editorial: Debt from student loans costly for institutions

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THERE is a great deal of compassion for those who seek to better themselves through a college education only to be confronted by the burdensome expenses that go with the experience.

Student loan debt was one of the central themes in the recent presidential election as candidates repeatedly raised the spectre of college graduates starting their careers tens of thousands of dollars in debt.

Indeed, total amount of debt through student loans has reached the stratospheric levels of credit-card debt and mortgage loans.

The sympathy that has been extended to these students often carries with it a corollary attitude of blame for the holders of the debt. In many cases, the debt is held not by banks or loan companies but by the universities where the former students had received their education.

In the case of public institutions, that debt extends to taxpayers.

Some of Indiana’s institutions of higher learning have been forced to take a hard line on collecting that debt. The most recent — Ivy Tech Community College — has employed a collection technique that is most widely used to garnishee state income-tax refunds of parents who are seriously in arrears in child support.

Now that Ivy Tech officials have enrolled in Indiana’s state tax intercept program, the money owed by individuals who have student debts can be seized from tax refunds.

While there is an understandable sympathy for those who are trying to better themselves, this particular situation has extenuating circumstances.

The majority of the money that Ivy Tech is trying to recover initially was provided to students through Pell Grants or Title IV funds but was forfeited when students dropped certain classes or entirely dropped out of school. In other words, these particular students failed to live up to one of the main obligations of the student-assistance program.

Statewide, the money owed is significant. School officials estimate that Ivy Tech is owed as much as $30 million on debts that were deemed in arrears over the past three years.

Closer to home, the Columbus/Franklin campus of the state college is owed $804,659.

The action taken by Ivy Tech is not a trailblazing maneuver. Purdue University, for instance, has employed the tactic and school officials estimate the university has recovered 25 percent to 50 percent of what is owed.

While the availability of programs such as Pell Grants does open the doors of opportunity to many who could not otherwise afford a college education, it is not something that should be the target for abuse. When individuals avail themselves of these opportunities, they incur obligations, the primary ones being to complete their educations and repay the money.

Regardless of the reason for dropping a class or leaving school, there is no excuse for evading that responsibility.

To let these loans go unpaid only increases the cost of a college education for everyone else.

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