Pomeroy Votes for Historic Investment in College Financial Aid
Via a press release from Rep. Pomeroy's office...
Washington, D.C. – Congressman Earl Pomeroy today voted for legislation that would boost college financial aid by about $20 billion nationally and by an estimated $78 million in North Dakota over the next five years. The College Cost Reduction Act of 2007 (H.R. 2669) would make the single largest investment in college financial aid since the 1944 GI Bill, directly benefiting the over 17,000 North Dakota students who take out need-based loans each year at 4-year public schools.
Among other things, this legislation will cut interest rates on subsidized student loans in half over the next five years, limit the percentage of income students spend repaying loans, and expand both the eligibility and size of the Pell Grant program. The legislation pays for itself by reducing federal subsidies paid to lenders in the college loan industry by $20.9 billion. It also includes $750 million in federal budget deficit reduction. The bill passed by an overwhelming bipartisan margin of 292-97 in the House and 79 to 12 in the Senate, and now goes to the President’s desk for his signature.
“A college degree is a necessity in today’s high-tech economy, and this bill will help thousands of students in North Dakota graduate from college prepared to compete in the global market place,” Congressman Pomeroy said. “With this bill, Congress has made a tremendous investment in the education of students in North Dakota who are facing large amounts of student loan debt or are struggling to afford college at all.”
Under the College Cost Reduction Act, the maximum value of the Pell Grant scholarship would increase by $1,090 over the next five years, reaching $5,400 by 2012. The maximum Pell Grant is currently frozen at $4,050. This legislation would also cut interest rates in half on need-based student loans, cutting interest rates from 6.8 percent to 3.4 percent in equal steps over the next five years. Once fully phased-in, this would save the typical student borrower in North Dakota $4,100 over the life of their loan.
The College Cost Reduction Act would also prevent student borrowers from facing unmanageable levels of federal student debt by guaranteeing that borrowers will never have to spend more than 15 percent of their yearly discretionary income on loan repayments and by allowing borrowers in economic hardship to have their loans forgiven after 25 years. The bill also invests an additional $510 million to minority-serving institutions, including tribal colleges.
Over the past several years, tuition has risen at more than double the rate of inflation. According to The Chronicle of Higher Education Almanac, between the 1999-2000 and 2005-2006 academic years, average inflation-adjusted tuition and fees at U.S. public colleges and universities increased by 36.3 percent. Students at North Dakota’s public schools were hit even harder, as the average inflation-adjusted tuition and fees at North Dakota’s four-year public colleges increased 43.8 percent during that same period to $5,202 per year. With that $1,586 increase over just six years, North Dakota families are finding it more and more difficult to afford to send their children to college.
The average student graduating from a four-year college or university in North Dakota leaves school with between $17,000 and $22,000 in debt, which represents 72% of all students attending 4-year institutions in North Dakota, according to the North Dakota University System’s 2007 Student Affordability Report.
Washington, D.C. – Congressman Earl Pomeroy today voted for legislation that would boost college financial aid by about $20 billion nationally and by an estimated $78 million in North Dakota over the next five years. The College Cost Reduction Act of 2007 (H.R. 2669) would make the single largest investment in college financial aid since the 1944 GI Bill, directly benefiting the over 17,000 North Dakota students who take out need-based loans each year at 4-year public schools.
Among other things, this legislation will cut interest rates on subsidized student loans in half over the next five years, limit the percentage of income students spend repaying loans, and expand both the eligibility and size of the Pell Grant program. The legislation pays for itself by reducing federal subsidies paid to lenders in the college loan industry by $20.9 billion. It also includes $750 million in federal budget deficit reduction. The bill passed by an overwhelming bipartisan margin of 292-97 in the House and 79 to 12 in the Senate, and now goes to the President’s desk for his signature.
“A college degree is a necessity in today’s high-tech economy, and this bill will help thousands of students in North Dakota graduate from college prepared to compete in the global market place,” Congressman Pomeroy said. “With this bill, Congress has made a tremendous investment in the education of students in North Dakota who are facing large amounts of student loan debt or are struggling to afford college at all.”
Under the College Cost Reduction Act, the maximum value of the Pell Grant scholarship would increase by $1,090 over the next five years, reaching $5,400 by 2012. The maximum Pell Grant is currently frozen at $4,050. This legislation would also cut interest rates in half on need-based student loans, cutting interest rates from 6.8 percent to 3.4 percent in equal steps over the next five years. Once fully phased-in, this would save the typical student borrower in North Dakota $4,100 over the life of their loan.
The College Cost Reduction Act would also prevent student borrowers from facing unmanageable levels of federal student debt by guaranteeing that borrowers will never have to spend more than 15 percent of their yearly discretionary income on loan repayments and by allowing borrowers in economic hardship to have their loans forgiven after 25 years. The bill also invests an additional $510 million to minority-serving institutions, including tribal colleges.
Over the past several years, tuition has risen at more than double the rate of inflation. According to The Chronicle of Higher Education Almanac, between the 1999-2000 and 2005-2006 academic years, average inflation-adjusted tuition and fees at U.S. public colleges and universities increased by 36.3 percent. Students at North Dakota’s public schools were hit even harder, as the average inflation-adjusted tuition and fees at North Dakota’s four-year public colleges increased 43.8 percent during that same period to $5,202 per year. With that $1,586 increase over just six years, North Dakota families are finding it more and more difficult to afford to send their children to college.
The average student graduating from a four-year college or university in North Dakota leaves school with between $17,000 and $22,000 in debt, which represents 72% of all students attending 4-year institutions in North Dakota, according to the North Dakota University System’s 2007 Student Affordability Report.
posted by Dem-NPL at 3:12 PM
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