Texas coordinating board approves $11.5M contract for student loan management software

The Higher Education Coordinating Board (THECB) of Texas convened on April 23, 2025, to discuss a significant contract proposal aimed at enhancing student loan management services. The primary agenda item involved a recommendation to contract with the Pennsylvania Higher Education Assistance Agency (PHEAA) for loan management software and support, with a budget not to exceed $11.5 million over a six-year period.

Caitlin Yost, the assistant commissioner for contracts, procurement, and grants, presented the proposal, highlighting the urgent need for a new system. The current vendor's legacy software is being phased out, leaving the agency in search of a modern solution to manage its student loan portfolio effectively. The competitive request for offers led to PHEAA being selected for its favorable functionality and overall value.

The proposed contract includes a loan origination platform through a third-party vendor, Campus Door, and a proprietary loan servicing software known as Comus. PHEAA has over 60 years of experience in the financial aid sector and currently supports more than 150 clients, including 50 outside of Pennsylvania.

The contract will initially span four years, with two optional one-year renewals. Implementation will involve a front-loaded cost for professional services to ensure a smooth transition from the current system to the new software. The agency plans to run both systems concurrently during the transition to avoid service disruptions for students.

Concerns were raised about data hosting, as the software will be hosted on PHEAA's networks in Pennsylvania. However, the agency will seek an exemption to ensure compliance with Texas data security requirements.

The meeting underscored the importance of modernizing student loan management systems to better serve Texas students, with the board's approval of the contract expected to facilitate this transition.