Summary

TICAS is planning to do a modeling of the impact of federal student loan income-driven repayment (IDR) options on student loan costs for borrowers. The work involves updating, and possibly upgrading, TICAS’s existing proprietary model to analyze the effects of proposed changes to IDR plans to support the development of recommendations to making repayment simpler, more affordable, and more equitable.

A more detailed scope is outlined below, but the overall goal of the work will involve updating the excel model to provide answers to questions like:

  • How do specific design details impact monthly payment amounts and the total cost of loan repayment, and how do those costs vary by borrower circumstance?
  • How does interest accrual over the life of a loan vary by proposed plans?
  • Which IDR design elements have the most meaningful impact on reducing inequitable loan burdens in both the short and long terms?

It is anticipated that this will commence in July 2021.

About TICAS

TICAS is a national nonprofit focused on promoting college affordability and equity. We seek concrete improvements to public policy, nationally, and in California and Michigan, through rigorous research, in-depth policy analysis, and effective advocacy. Our team focuses on designing evidence-based, research-driven policies and then advocating for their implementation.

TICAS has longstanding leadership in the design of income-driven repayment (IDR) policy. Over a decade ago, TICAS formulated the framework for Income Based Repayment (IBR), the first widely available income-driven repayment plan for federal student loan borrowers, and built the coalition that fought for its implementation. TICAS has also been instrumental in shaping successor income-driven repayment plan approaches.

Scope of project

  • Update our proprietary, Excel-based, model to analyze the effects of proposed changes to income-driven repayment (IDR) plans. Model will include both existing IDR plans and proposed plans, as well as provide for the ability to adjust specific aspects of those plans.
  • Analyze patterns in how different IDR plans and specific design details impact borrowers’ monthly and total payments, including for borrowers with different family sizes and career trajectories.
  • Develop and model assumptions about different types of borrowers to shed light on how different plans and design choices can impact economic and racial equity, as well as consider the special problem of borrowers with small loans and high risk of default.
  • Summarize and disseminate findings through a published brief and other vehicles to inform IDR regulatory and legislative efforts.
  • Optional: Streamline IDR modeling infrastructure to allow for more agile analysis of IDR design changes (e.g., migrate Excel formulas to programming language). Consultant would work with TICAS staff to determine if it would be helpful to upgrade the modeling infrastructure in parallel with work on immediate analysis needs

Anticipated timeline/workflow

  • Month 1: Initial planning and background work
  • Month 2:
    • Consultant will update TICAS model with additional design choices and integrate recently proposed IDR plans.
    • Consultant will work with TICAS staff to plan modeling of additional plans/design options.
  • Month 3 (and beyond, as needed):
    • Consultant will model borrower scenarios for different IDR plans, with adjustments to individual design elements of interest.
    • Consultant will iteratively write up results to internally inform TICAS staff.

Anticipated time commitment

  • 200 hours total (may be higher if scope expanded to upgrade IDR modeling infrastructure)

Please connect with Patricia Balana, Chief Operating Officer, pbalana@ticas.org if this project is of interest to you.