The Brief

Just over a year ago, the U.S. Department of Education abandoned key oversight of the companies that run the federal student loan program, according to a new report from the nonpartisan U.S. Government Accountability Office (GAO).

GAO investigators found that, in February 2025, the Office of Federal Student Aid (FSA) stopped reviewing the accuracy of loan servicers' records. FSA also stopped reviewing recordings of calls with borrowers to make sure they're being given accurate information.

Without this oversight, the report warns, borrowers could feel the consequences.

"If servicers' records are inaccurate, borrowers could, for instance, be placed in the wrong loan repayment status, billed for incorrect amounts, or not have a refund processed in time," the report says. "Similarly, FSA has not monitored calls since February 2025, so there is a risk that borrowers have received or will receive incorrect information and poor customer service."

The investigation was requested by the ranking members of the House and Senate education committees, Rep. Bobby Scott, D-Va., and Sen. Bernie Sanders, I-Vt.

"Instead of providing relief to 43 million Americans who are drowning in student debt," Sanders said in a statement to NPR, "the Trump administration has made it harder for them to understand how much they owe and how long it will take to pay back."

What the administration has to say about GAO's findings

The Office of Federal Student Aid is supposed to conduct quarterly reviews, according to its contracts with loan servicers.

These reviews include comparing loan servicers' borrower records with FSA's own records, to screen for gaps or discrepancies, as well as "targeted reviews" of borrowers in specific situations, including those who request temporary relief from their payments.

The assessments that were stopped are more labor-intensive than other types of oversight that have been automated, GAO says. According to the report, agency officials told the government watchdog they stopped these reviews in early 2025 "due to lack of FSA staff capacity." That's around the same time the Trump administration began dramatically reducing staffing levels at the Education Department.

According to the report, FSA began 2025 with 1,433 staffers; by December, it had 777 — a 46% reduction.

In a written response accompanying the report, Richard Lucas, FSA's acting chief operating officer, disagreed with GAO's recommendation that FSA resume the reviews. While he confirmed that FSA had, indeed, stopped the oversight in question, Lucas wrote, "FSA determined that a better approach is to provide substantial oversight through additional activities that measure the accuracy of servicer data and the quality of their performance." Those activities include regular reviews of borrower satisfaction surveys.

Melissa Emrey-Arras, who led the GAO study, says FSA's "better approach" isn't better.

"While reviewing those satisfaction surveys may be helpful, they don't directly assess the quality of the information given to borrowers. A borrower may indicate they were satisfied with a call, not realizing they were given completely wrong information by their servicer," she says.

The last FSA review found problems with loan servicer accuracy

Scott Buchanan, the executive director of the Student Loan Servicing Alliance, which represents the servicers working on the federal student loan program, says servicers also police themselves.

"[Servicers] internally are monitoring far more than any of our regulators ever could or would. Because it is in our best interest to make sure those errors are fixed. And because we have contracts, and if we have major issues that have become clearly apparent, then people will say, 'We'll find someone else to do it.'"

At the end of 2024, before the Trump administration cut oversight, GAO's review of servicer recordkeeping found that "four of the five servicers did not meet the accuracy performance standard and faced associated financial penalties."

In fact, recordkeeping at two servicers was troubled enough to merit the maximum financial penalty allowed.

And GAO notes that the Education Department's independent financial auditor reported as recently as January 2026 that the department "continued to have a material weakness related to the reliability of its student loan data."

What's more, Emrey-Arras says, scaling back oversight at FSA has also meant scaling back efforts to hold servicers financially accountable for their performance. This accountability, she says, "is critical. Without it, the government risks overpaying for poor performance."

For borrowers, servicer mistakes can lead to very real problems, said Rep. Scott in a statement to NPR. "Borrowers can either overpay or be placed in the wrong student loan repayment program. [The Education Department's] refusal to conduct oversight of student loan servicers is a dereliction of duty."

Scaled-back oversight of big student loan changes

These cutbacks in staff and oversight come as millions of federal student loan borrowers will need help transitioning into new repayment plans. The Biden-era SAVE plan is in turmoil, with borrowers now being charged interest and the plan due to be closed by 2028 at the latest. Another 12 million borrowers are either in default on their loans or on their way there.

What's more, in July, a raft of new, potentially challenging changes to the student loan program will begin — courtesy of Republicans' One Big Beautiful Bill Act — including the introduction of two brand-new repayment plans and the phasing out of others.

GAO warns that these changes will affect millions of borrowers who "will need accurate and complete information when they call for help," yet, for the time being, the Education Department can't be certain that's what borrowers are actually getting.

Copyright 2026 NPR

As Los Angeles gears up for a surge of tourists for this year’s FIFA World Cup and the 2028 Olympics, vacation rental giant Airbnb is urging the city of Los Angeles to legalize thousands of new short-term rentals.

The company promises that the expansion will add more than $100 million in tax revenue to city coffers amid a severe budget crisis. But opponents say more short-term rentals will further strain an already limited housing supply.

In a report issued this month, Better Neighbors LA, a coalition of housing activists and labor groups that monitor short-term rentals, countered the Airbnb proposal with its own revenue generating idea: Enforce the city’s existing home sharing law, cite violators and bring in tens of millions of dollars in fines that the group says the city has simply failed to collect.

Beefed-up enforcement is a “simple fix for the city” that would “raise enormous amounts of money,” said Randy Renick, Better Neighbors LA executive director. “It’s also going to return thousands of affordable housing units to the market for long-term renters,” he said. (Disclosure: Renick’s law firm, Hadsell Stormer Renick & Dai, is a financial supporter of Capital & Main.)

Better Neighbors’ coalition includes the hotel workers union UNITE HERE Local 11, along with local organizations like Venice Community Housing and Strategic Actions for a Just Economy. (Disclosure: UNITE HERE is a financial supporter of Capital & Main.)

Last year, as Airbnb rolled out its “Save Our Services” campaign for short-term rental expansion, it poured $19 million into lobbying and political contributions at the state level, according to the California Secretary of State’s online database.

Also in 2025, the company spent $360,000 on lobbying at Los Angeles City Hall and made hefty donations to charity at the request of L.A. city councilmembers, Los Angeles Ethics Commission records show. The company donated $570,000 to the nonprofit Salvadoran American Leadership and Educational Fund at the request of L.A. City Councilmember Traci Park and $25,000 to the North Valley Family YMCA at the request of Councilmember John Lee.

California law places no limits on such donations, known as behested payments, but requires them to be disclosed to help the public identify attempts to influence public officials.

Airbnb wants the city to revive an idea that city councilmembers, including former councilmember Herb Wesson, the father of current Airbnb spokesperson Justin Wesson, first proposed eight years ago. The proposal would have allowed property owners to list second homes on platforms like Airbnb, Vrbo or booking.com. The current proposal would add up to about 31,000 units to the city’s short-term rental market. Under L.A.’s Home-Sharing Ordinance, which took effect in 2019, short-term rental hosts are allowed to list only their primary residences on vacation booking platforms. Neither Vrbo nor booking.com responded to Capital & Main’s request for comment about the proposal.

The Airbnb-backed coalition, Save Our Services, says on its website that the additional vacation rentals could generate more than $100 million for the city in “bed taxes,” a 14% levy on overnight stays paid by hotel and short-term rental guests, as well as $100 million in sales tax revenue from tourist spending.

Labor unions like the Teamsters Joint Council 42, the Los Angeles/Orange Counties Building and Construction Trades Council and the International Association of Theatrical Stage Employees, along with the Central City Association of Los Angeles and community groups like the Brotherhood Crusade and the Koreatown Youth and Community Center, back the effort.

Airbnb spokesperson Justin Wesson said in a statement, “By allowing a limited, regulated number of vacation rentals in the City of Los Angeles we can help stabilize funding for essential services, support neighborhood-based tourism, and prepare the city for upcoming global events in a way that benefits residents, visitors, and local businesses alike.”

Airbnb supports stronger enforcement of the city’s Home-Sharing Ordinance, Wesson wrote in a January 2026 letter to the L.A. City Council. The letter also urges the city to require all vacation rental platforms to share data with the city and remove illegal listings. Airbnb is the only company that currently does so voluntarily.

The Better Neighbors LA report dismisses Airbnb’s claim that expanding short-term rentals would generate more than $100 million in new hotel taxes as “fanciful” because the proposal wouldn’t necessarily bring additional tourists to the city. In 2020, as the City Council first considered an expansion of the short-term rental market, Los Angeles Director of City Planning Vince Bertoni was also skeptical that expanding vacation rentals would draw visitors to Los Angeles.

Still, the World Cup and the Olympics will bring an influx of visitors to L.A., and groups like Better Neighbors LA fear that the city will lose much needed housing to tourist rentals, especially if city officials permit additional vacation rentals.

This concern is heightened by the fact that the city has long struggled to enforce its existing Home-Sharing Ordinance.

Fully half of the Los Angeles vacation rentals listed on booking sites are illegal, according to data included in the Better Neighbors LA report. But only a tiny fraction of violators are cited; the city has collected a total of about $667,000 in fines under the 2019 home sharing law, Better Neighbors LA reports. The group estimates the city could immediately rake in $95 million in two months if it stepped up enforcement.

City Councilmembers Katy Yaroslavsky and Hugo Soto-Martinez, whose Hollywood-Silver Lake district has among the highest concentration of the city’s short-term rentals, support Better Neighbors’ plan to increase enforcement of the city’s current law.

“This report makes clear that the path forward is enforcing the home-sharing laws already on the books,” Soto-Martinez said in a statement. “If we fully implement the rules we passed, we can protect tenants and generate additional revenue for the city without sacrificing housing.”

L.A.’s Home-Sharing Ordinance generally allows individuals to list only their primary residences on sites like Airbnb and Vrbo for up to four months, although the city also makes exceptions, allowing year-round “extended home sharing” in many cases. Home sharing is not permitted in dwellings covered by the city’s rent control law or in affordable housing units, including those built with public funds.

But property owners have easily evaded the existing home sharing law, even amid a severe housing and homelessness crisis. In 2024, a Capital & Main and ProPublica investigation found that tourists could rent apartments in dozens of rent controlled buildings in apparent violation of the law. Owners of some of these buildings openly listed fabricated or nonexistent city registration numbers and were never cited.

For years, residents complained about loud parties in short-term rentals, parking problems and the loss of permanent housing in their neighborhoods. Last March, the City Council finally voted to pursue reforms, including requiring short-term rental platforms to use a computer system that would automatically block illegal transactions and giving individuals the right to sue suspected short-term rental law violators. But the reform effort hasn’t moved forward.

Last year as the City Council considered stricter oversight of short-term rentals, Los Angeles Housing Department officials said they lacked the staffing and resources to effectively enforce the ordinance. This month, Sharon Sandow, a spokesperson for the housing department, which is one of several city agencies overseeing the Home-Sharing Ordinance, said in an email that all of the departments would have to assess their “resources and capacity” for a coordinated enforcement effort.

Meanwhile, the Airbnb proposal has caught the attention of at least one city councilmember, Heather Hutt, who represents Koreatown and Mid-City. In January, Hutt requested that the chief legislative analyst and other city department staff brief the City Council’s budget and finance and planning and land use committees on the status of the ordinance.

Support for the Airbnb plan would represent a distinct shift for most members of the City Council: Last year, councilmembers put themselves squarely on the side of limiting short-term rentals in the city, voting 12-0 to strengthen oversight of the program. Three members — John Lee, Monica Rodriguez and Bob Blumenfield — were absent.

Copyright 2026 Capital & Main

Iran's sports minister said Wednesday that the team will not compete in the World Cup, citing the U.S. war on Iran, the Associated Press and other news outlets reported.

Iran is scheduled to play two matches in Los Angeles in June against New Zealand and Belgium.

Iran's participation in the global tournament has been in question since the U.S. and Israel launched a bombing campaign against the country in late February.

On Wednesday, the country's sports minister, Ahmad Donyamali, told state television that the country's team would not participate in the tournament in the U.S. “considering this corrupt regime has assassinated our leader,” according to the New York Times. A joint U.S.-Israeli attack killed Iran's Supreme Leader Ayatollah Ali Khamenei on the first day of the war.

The remarks came after FIFA president Gianni Infantino said Tuesday that he had met with President Donald Trump and that Iran continued to be welcome to attend the World Cup.

"We also spoke about the current situation in Iran, and the fact that the Iranian team has qualified to participate in the FIFA World Cup 2026," Infantino said in an Instagram post. "During the discussions, President Trump reiterated that the Iranian team is, of course, welcome to compete in the tournament in the United States."

Infantino has faced heavy criticism for awarding Trump the first-ever "FIFA Peace Prize" last year.

A FIFA spokesperson told LAist that Iran has not formally pulled out of the tournament. The local host committee for Los Angeles declined to comment, directing LAist to FIFA.

According to FIFA's regulations, any participating team that withdraws from the World Cup will be required to repay FIFA "preparation money as well as any other tournament‑related contribution payments."

The regulations also say FIFA has sole discretion to determine next steps if a team pulls out, including replacing the team.

An insurance crisis continues to rattle California’s foster care system, threatening to displace thousands of vulnerable children.

Since 2024, more than two dozen nonprofits that recruit, train and support foster parents have shuttered across 13 counties, according to the California Department of Social Services.

Counties have historically relied on the licensed nonprofits, known as foster family agencies, to place children — especially those in need of intensive support — in certified homes until they are adopted or reunified with their birth families.

Their closures come two years after a key insurance carrier backed out of covering foster family agencies, citing rising legal costs. The company, Nonprofits Insurance Alliance of California, covered approximately 90% of the more than 200 foster family agencies operating throughout the state, leaving them scrambling to find a replacement.

No other California insurers have stepped in since then, forcing foster family agencies to secure coverage from companies outside the state — and sometimes, outside the country. In an unregulated market, that’s meant that agencies have seen increases of 200 to 400% in their liability coverage. Many are reporting cost hikes of more than $350,000 in annual premiums.

The Legislature last year approved a one-time $31.5 million allocation to buoy the agencies as they face unsustainable premiums, but the money has run out. Assemblymember James Ramos, a Democrat from San Bernardino, and Sen. María Elena Durazo, a Democrat from Los Angeles, recently requested another $30 million in relief funding.

Tony Iagmin holds a three-month-old baby at his home in San Diego’s Lakeside neighborhood on Feb. 23, 2026. Tony and Sara Iagmin are fostering the baby.

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But without any long-term policy solutions, advocates warn that the whole system is at risk of collapsing. It would start with some or all of the remaining foster family agencies closing. Foster parents, lacking the support that’s needed to sustain them, could then exit the child welfare system altogether and kids would face even more instability, the advocates say. And medically fragile children — including kids with feeding tubes, developmental disabilities or drug dependencies from their mothers — are especially at risk because counties don’t typically have sufficient resources to provide that level of care.

“It would be an absolute crisis if the foster family agencies closed,” said Diana Boyer, managing director of research and policy at the County Welfare Directors Association of California. “Foster children are the state’s children. We all collectively need to be doing more to support them and ensure that they have homes and families to go to.”

The crisis is tied to California’s attempts to provide redress to survivors of sexual abuse. Legislation passed in 2019 lifted the statute of limitations, allowing survivors to sue government agencies. Thousands of lawsuits have been filed since then, and hefty payouts have driven up insurance costs for public agencies across the board. Schools were among the first to feel the pinch from rising costs for insurance to cover liability from the suits.

The Nonprofits Insurance Alliance of California stopped renewing insurance policies following a $25 million payout to three children after a jury found that a foster family agency in Santa Rosa failed to protect them from sexual abuse. The group had also made a mostly failed effort to reform aspects of California law related to insurance and liability.

'Our collective responsibility'

Roughly 300 foster family agencies operate throughout California, providing critical services to approximately 6,500 of the state’s 45,000 foster children.

Counties run many of their child welfare placements through the community-based nonprofits because of their quality of care — especially for kids with the highest needs.

If a child is removed from their home in the middle of the night due to abuse or neglect, foster family agencies quickly step in with supportive homes that are “at the ready,” said Pete Weldy, chief executive officer at the California Alliance of Child & Family Services, which represents roughly 200 foster family agencies around the state.

After initial placement, the agencies continue to work with foster families and kids to provide sustained support, including around-the-clock care, crisis assistance, and consistent case management.

When an agency shutters, the child’s placement could be disrupted.

“That’s one of the untold stories of this whole crisis,” Weldy said. “It could mean that the youth has to move to a different county, to a different foster family. They could be uprooted from their family. They might have to change schools, maybe move communities, lose their friends.” The disruption, he added, can often exacerbate behavioral health needs. “Eventually, it could lead to the worst outcome, which is that the child ends up unhoused,” he added.

If counties are unable to find a placement, Weldy said the child may end up in a hotel, hospital, or conference room.

“This is the state’s responsibility and really, therefore, all of our collective responsibility to make sure these really vulnerable kids and youth have what they need to thrive,” he said. “And that’s where foster family agencies do such an incredible job.”

Foster families 'knew who to turn to'

Tony and Sara Iagmin play with the baby they are fostering at their home in San Diego’s Lakeside neighborhood on Feb. 23, 2026.

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Sara and Tony Iagmin have fostered 45 children since 2013, when they started working with Angels, a San Diego-based foster family agency that recently closed due to the insurance crisis. Over that period of time, they worked with three case managers from the agency that would make weekly visits to the child or children they were currently fostering. That consistency served them and their foster children well, they said.

“We knew who to turn to and how to get support for everything that came up,” Sara Iagmin said.

They fear that the increasing number of agency closures will result in more kids falling through the cracks and hurt foster parents, especially those who are new to the child welfare system and may need additional support.

“Foster family agencies are like AAA and the county is like the DMV,” Tony Iagmin said. “They have good workers, but it’s a lot of bureaucracy.”

Since Angels closed, the Iagmins started working directly with San Diego County. They said they feel well-equipped to handle the shift since they’ve been foster parents for so long, but will miss the community they found through Angels.

Tony and Sara Iagmin at their home in San Diego’s Lakeside neighborhood.

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Photos of families Sara and Tony Iagmin have worked with over the years hang on a wall at their home in San Diego’s Lakeside neighborhood on Feb. 23, 2026.

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In Placer County, Sarah and Michael Prince have worked with the foster family agency Koinonia Family Services since 2016. After struggling with infertility for over a decade, the couple decided to attend the agency’s orientation.

“I came home buzzing,” said Sarah Prince. “My intuition said, ‘This is my home.’”

It took them two years to go through the agency’s certification process. Since then, the couple has taken in 13 foster children, four of whom they ended up adopting.

“I couldn’t have done it without a foster family agency,” said Sarah Prince. “It’s an extra layer of protection for you. They are your family. When the things fall, it’s the knowing that you have somebody to call. It’s consistency for these kids that haven’t had consistency because your foster family agency workers don’t change.”

Laura Richardson, a manager at Koinonia Family Services, said the statewide agency works with roughly 360 homes, 99 of which are not taking placements. On any given day, they serve around 200 youth in their foster family homes.

According to Richardson, the organization’s insurance increased by 242% — from $272,000 to $933,000 per year — since the Nonprofits Insurance Alliance of California stopped renewing their policy. It’s meant that they’ve had to rescind their licenses in three cities, transferring those families to other offices that are still operating.

Richardson said they’re trying to hold out for as long as they can for the state to come up with a solution. But as more and more agencies shutter, she worries that the homeless population will increase for youth.

“I worry about the safety net for these most vulnerable youth going away,” she said. “It’s going to stress other parts of the system. So the state is going to have to pay for it somewhere. My hope is that we can fix what’s good about what we already have before we lose it.”

Cayla Mihalovich is a California Local News fellow.

This article was originally published on CalMatters and was republished under the Creative Commons Attribution-NonCommercial-NoDerivatives license.