INDIANAPOLIS  — A bill authored by State Sen. Spencer Deery (R-West Lafayette) that will limit scenarios in which public Indiana colleges may refuse transcript distribution to current and former students was signed into law by Gov. Eric Holcomb today.

Under this common practice, colleges withhold transcripts from current and former students in order to collect a debt the individual owes, which limits their ability to transfer to another institution or even get a job.

Senate Enrolled Act 404 prohibits universities from withholding a transcript if a student paid at least $100 to $300 toward their debt within the last year, depending on the amount owed.

According to Ithaka S+R, around 138,000 Hoosiers owe an average of $2,800 to colleges and universities.

“More Hoosiers will complete a college degree because of this bill,” Deery said. “States across the country have been searching for a way to deal with this problem without harming their universities. Indiana is the first to find that balance. My hope and belief is that Indiana’s solution will become a model that other states will follow.”

SEA 404 will not forgive the debt, but change how universities can leverage transcripts in order to collect the money current and former students may owe the institution.

In recent years, Ivy Tech Community Collegestopped withholding transcripts because of the success in obtaining payment through tax rebate intercepts, which are permitted by Indiana law.

SEA 404 is Deery’s first bill to be signed into law since being sworn into office in November 2022.

The law will go into effect on July 1, 2023.

To learn more about SEA 404, visit iga.in.gov.