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The plan is part of a series of initiatives introduced by the administration to "modernize" the Higher Education Act of 1965.
"President Trump recognizes the serious situation many Americans find themselves in with rising student loan debt and has already taken significant administrative and regulatory action to undo the damage from the previous administration," Deputy White House Press Secretary Judd Deere told FOX Business in a statement.
"The president has also proposed a modernization of the Higher Education Act, which would increase access to affordable, quality education, improve accountability and help students make informed decisions regarding their educational options. Unfortunately, radical Democrats, including those on the HELP Committee, continue to play politics and propose big-government giveaways that do nothing to solve the problem," Deere added.
The Obama administration asked Congress in 2012 to stop providing Summer Pell grants to low-income students, but the administration restored the program in 2019. The Trump administration also took action to fix the TEACH grant program and cut costly regulations.
Student debt in the U.S. has contributed to about $1.5 trillion in debt -- the second-largest cause of debt in the U.S. next to mortgage loans, according to multinational consumer credit reporting company Experian .
Education Department Press Secretary Angela Morabito told FOX Business in a statement that Secretary of Education Betsy Devos has been working with the White Hosue and other stakeholders to amend the country's broken student loan system without putting an unfair burden on taxpayers.
"Secretary DeVos is focused on bringing transparency and accountability to higher education. She has rolled out a new College Scorecard that shows median debt and earnings for each field of study at each school, and she has spearheaded the Next Generation of Federal Student Aid which is turning a once complicated web of loan servicers and repayment plans into a customer-friendly financial institution," Morabito said.
"Secretary DeVos has frequently criticized the 2010 federal takeover of student aid and has floated the idea of making Federal Student Aid a standalone entity," she added.
Various 2020 presidential candidates have suggested eliminating all of some student loan debt in the U.S. and/or offering free tuition at public colleges. Most notably, Sen. Bernie Sanders' (I-Vt.) student loan cancellation and free public college plan carry an estimated price tag of $2.2 trillion total. A similar plan put forward by Sen. Elizabeth Warren could cost $1.25 trillion.
Brittany De Lea contributed to this report.