SB 404 / Chamber Supports

Senate Bill 404, authored by Sen. Spencer Deery (R-West Lafayette), would prohibit Indiana postsecondary educational institutions from withholding a transcript for a current or former student if the student owes a debt to the institution, provided that the student is making a good faith effort to pay the outstanding debt.

Senate Bill 404 was heard by the Senate Education and Career Development Committee and a committee vote is expected next week.

It’s estimated that some 750,000 Hoosiers have some college credits but no degree, lacking both the currency and earning power that a postsecondary credential provides. A subset of this population is stuck in a sort of transcript limbo: lacking a record of the college credits they’ve earned, saddled with debt, and stymied from completing the remaining credits required to earn their degree, which would of course increase their prospects of paying off that debt. Colleges have long withheld transcripts as a means for pressuring current and former students to pay off debts owed to the university. Transcript holds are used by colleges to collect on everything from large debts in the thousands of dollars to an unpaid parking ticket. Critics have questioned whether transcript holds are even effective for recouping college debts, but even proponents of the practice would concede that the prospect of adults returning to the classroom to finish a degree is unattainable without access to their university records.

Some states, including California and Washington, have banned the practice of transcript holds altogether. Senate Bill 404 takes a less severe approach, one endorsed by the Chamber, that would remove the transcript roadblock while still giving colleges leverage to settle outstanding debts. As proposed, colleges would be prohibited from withholding a transcript if the student has paid at least $100 toward the total debt owed within the last year.

The Indiana Chamber supports common sense measures that reduce barriers to increasing the education attainment level of Hoosiers in alignment with workforce needs. Placing reasonable guardrails on the practice of college transcript holds removes one such barrier that stands in the way of Indiana making good on that promise.

Resource: Jason Bearce at (317) 264-6880 or jbearce@indianachamber.com