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Lawmakers hear calls to require colleges to report "institutional debt" owed by students
Summary
Delegates heard broad support for HB 877, which would require Maryland higher‑education institutions to report institutional debt (fees and other amounts owed directly to schools) to MHEC; witnesses said current data gaps prevent targeted consumer protections and cited studies estimating hundreds of millions in outstanding balances.
The House Appropriations Committee heard testimony supporting House Bill 877, which would require Maryland colleges and universities to report institutional debt information to the Maryland Higher Education Commission.
Sponsor Delegate Ryan Spiegel described "institutional debt"—charges and balances students owe directly to institutions, such as past‑due fees and administrative holds—and said that the lack of reporting keeps policymakers and the public from understanding the scope of the problem. "While one study estimated that approximately 125,000 Marylanders may owe as much as $332,000,000 in institutional debt," Spiegel said, "we don't know the precise landscape because only institutions have the data."
Advocates including Protect Borrowers, the Institute for College Access & Success, and the Center for Responsible Lending urged the bill, noting equity concerns: earlier testimony cited survey and public‑records findings that some institutions reported tens of millions in institutional debt across tens of thousands of students, and that Pell recipients can be disproportionately affected.
MHEC indicated general support for the reporting objective but recommended technical amendments to reduce administrative burden—moving to biennial reporting, standardizing definitions, and avoiding monetary penalties for initial noncompliance.
Next steps: Committee members asked clarifying questions about how the data would be used and whether the reporting would inform consumer‑protection legislation. Sponsors and witnesses said the initial goal is transparency and that policy responses would follow from better data, not be preordained.
Quote: "The data has to come before we develop an appropriate solution," Delegate Spiegel said.
