Los Angeles — In May of 2022, commencement day for graduating seniors at the Otis College of Art and Design in Los Angeles came with both dreams and debt.
Suhey Elias, a former student, told CBS News she was graduating with $60,000 to $65,000 in debt. Her classmate, Keila Medina Villanueva, said she had between $50,000 and $60,000 in debt.
Their commencement speaker was Snapchat co-founder and billionaire Evan Spiegel, who had taken classes at Otis years before.
"You've got everything you need to pursue your dreams," Spiegel told the graduates in his speech.
Everything, perhaps, but pennies from heaven. What followed, however, was pretty close.
"And I told my friend, 'What, are they gonna pay our student loans?'" Villanueva recounted this week to CBS News. "Joking around."
Charles Hirschhorn, Otis president, took to the stage and announced that Spiegel and his wife, businesswoman Miranda Kerr, would be making the largest single donation in school history through their nonprofit Spiegel Family Fund to pay off the entire student loan debt for the 2022 graduating class.
The students were in shock.
"They were right in front of me, and they're all gasping," Hirschhorn recalled.
"My jaw dropped," Villanueva said. "I was like, what?"
"What just happened?" Elias said, recalling her reaction. "I just said, 'Oh my God.'"
The donation totaled at least $10 million, the school said.
About 70% of college graduates owe student loans, according to the nonprofit research group the Urban Institute. Roughly half of borrowers still owe $20,000 or more 20 years after entering school, per data from the Education Data Initiative.
The gift from Spiegel and Kerr allowed Suhey to focus on her painting.
"I might have had to put my dream aside and just focus on the loans," Suhey said. "But now I'm able to do what I love."
Villanueva had been working at McDonald's, but now she is making ceramics and selling them at art shows. With her student debt paid off, she is paying it forward, looking to teach art in lower-income communities.
"The bills would be the ones deciding what I did after," Villanueva said. "Now it's me deciding."
The student loan issue has taken center stage amid Washington's debt ceiling negotiations. The proposed bill making its way through Congressthe payment pause on federal student loans that began during the COVID-19 pandemic.
In addition, the Biden administration's student loan forgiveness plan,in August 2022, is the Supreme Court, with a decision expected soon. The plan would cancel up to $20,000 in student loan debt for millions of Americans. The Senate on Thursday , but President Biden has said he will veto that effort.
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