(A)A string ofrecent for-profit college closures has led to tens ofmillions of dollars in student loan cancellation, creating new costs for the federal govemment on top of disruptions caused for thousands of former students.According to numbers recently provided by the U.S.Department of Education to Senate lawmakers, the federal government as of May had discharged more than $43 million in student loans for borrowers who attended programs operated by Education Corporation of America, Dream Center Education Holdings, Vatterott College and Charlotte School of Law. 

(B)Students who attended ECA campuses, including Virginia College and Brightwood College,have so far received more than $22.6 million in debt cancellation.About 3,300 students at those campuses were approved for loan discharge as of May.Students at campuses operated by Dream Center have received more than $10 million in debt relief.And more than $5 million in student loans have been discharged for former students of Vatterott College and Charlotte School of Law. 

(C)Those numbers likely will continue to rise as more students learn about their eligibility for loan relief and submit applications for what's known as a closed-school discharge.Student borrowers can apply for a full discharge of their federal loans if they were enrolled when their college closed or withdrew within 120 days of the official closure date and didn't transfer to another in-stitution. 

(D)The federal government wiped out nearly $200 million in student debt for borrowers enrolled in Corinthian Colleges programs after the for-profit chain's shutdown in 2015.And it's forgiven another quarter billion in loans for former students of the ITT Tech chain, which shut down the following year. 

(E)The latest data provided to Senate lawmakers show that for-profit closures have continued to cre-ate big costs under the Trump administration.Clare McCann, deputy director of New America's higher education program and a former Obama administration official, said those closures create big liabilities for the federal government because the colleges involved are large-most institu-tions that close have fairly nominal enrollments by the time they shut down; not so with for-prof-it college chains.The costs are also bigger because students may not be opting to take their cred-its elsewhere, she said. 

(F)Outside of Corinthian and ITT, the last college to create comparable liabilities for the federal government was Dade Medical College, which closed in 2015.That institution's owner, Ernesto Perez, was put on trial last year for violating state law with the closure.The Education Depart-ment wiped out roughly $10 million for borrowers who attended Dade Medical. 

(G)Debbie Cochrane, vice president of the Institute for College Access and Success, said the loan discharge costs show the need for better policing of problematic colleges on the front end.“Reg-ulations by the prior administration were designed to provide incentives for schools to leave their students better off and to give colleges a financial stake to do so,”she said.

(H)The costs involving student loan discharge are dictated in part by whether a college facing clo-sure has secured opportunities for students to complete their degree through a process known as a teach-out.Students are supposed to either have the opportunity to finish their credential or transfer to a comparable college.

(I)Teach-out agreements weren't in place last December, when Education Corporation of America,the parent company of the Virginia College and Brightwood College chains, made a surprise an-nouncement that it was closing 70 campuses across the country.Quality issues identified at ECA campuses also meant transferring credits likely would be a difficult proposition for many stu-dents, although a number of programmatic teach-out agreements were agreed to after the compa-ny's closure.

(J)At the time of the chain's closure, the Education Department hadn't secured a letter of credit—akind of financial collateral that colleges may be required to set aside when they show signs of fi-nancial instability.Diane Auer Jones, the department's deputy under secretary, said at a Biparti-san Policy Center event in April that the department did not have the authority to request a letter of credit after the company received a passing financial responsibility score in its most recent au-dit.The lag time for those audits, however, means the financial information about colleges is al-ready two years old by the time the federal government receives it, so the department doesn'thave the most up-to-date picture of an institution ' s financial health.

(K)“We're always going to be in this place where some people think we can look into our magic ball and at any moment see what the financials are at an institution at any given moment in time” she said.“It doesn't work that way.” Jones said deciding when to request a letter of credit can be tricky for the department-if officials don't seek enough collateral, for example, it won't cover liabilities like closed-school discharge claims.“On the other hand, if the letter is too large, you'll probably end up forcing a precipitous closure,” she said. 

(L)The department sought another letter of credit and imposed new cash restrictions after ECA sought to enter a court-appointed receivership.Company executives blamed the December shut-down on those measures and a looming suspension ofrecognition from their accreditor. 

(M)By the time Dream Center began closing campuses earlier this year, the department had cashed out the proceeds of a letter of credit secured from Education Management Corporation, which previously owned the Argosy and Art Institute campuses.Those funds supported teach-out ef-forts at about 30 campuses, according to an agreement outlined by federal officials last yea r.Af-ter the chain's closure, the department held about $24.5 million from the letter of credit, wluch will cover closed-school discharges as well as liabilities like borrower-defense applications. 

(N)Liabilities for closed~school discharge claims will still be assessed against the institution itself.The Education Department, however, is just one of several entities with potential claims against Dream Center.The company's creditors include landlords who say they are owed hundreds of thousands in rent that was never paid. 

(O)Shafroth said the department is in a better position to assume liability for that debt than students and should do so because it approved the colleges' access to federal financial aid.