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For Immediate Release
September 07, 2007
The 110th Congress, Reducing the Cost of College for Parents and Students
Washington D.C. – Congressman John Conyers, Jr., chairman of the House Committee on the Judiciary and Dean of the Congressional Black Caucus, made the following statement regarding the passage of H.R. 2669, the College Cost Reduction Act conference report.“In sending the College Cost Reduction Act to the President today, we in the 110th Congress have making the single largest investment in college financial aid since the 1944 GI Bill. By cutting interest rates in half on subsidized student loans and increasing the maximum Pell Grant scholarship, H.R. 2669 will provide our nation with a real chance, a $20 billion chance, to roll back the skyrocketing cost of higher education in this country and make getting a degree more affordable and move more Americans into the middle class.
Over the last few decades, the cost of a postsecondary education in our country has more than doubled for graduates; in Michigan alone, the debt of typical need-based student loan borrower at 4-year school is $13, 256. Since the first legislative hours of the 110th Congress, the Democratic majority in the House of Representatives has made addressing college affordability one of our most important priorities. In passing that legislation, we kept our promise of making college more affordable and accessible.
As the richest nation in the world, we have a moral obligation to eliminate the barriers this de facto economic segregation erects. No child should be forced to forgo the dream of a college education due to fear of debt, and no child should have that potential debt dictate their future career choice.”
Under the legislation, the maximum value of the Pell Grant scholarship would increase by $1,090 over the next five years, reaching $5,400 by 2012. This increase would fully restore the purchasing power of the scholarship, which in recent years had been frozen at $4,050 until Congress boosted its value to $4,310 earlier this year. Close to 6 million low- and moderate-income students would benefit from this increase.
To reduce the cost of loans for millions of student borrowers, the legislation would cut interest rates in half on need-based student loans, from 6.8 percent to 3.4 percent over the next four years. Once fully phased-in, this would save the typical student borrower – with $13,800 in need-based student loan debt – $4,400 over the life of the loan. About 6.8 million students take out need-based loans each year.
In addition, the legislation would 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 College Cost Reduction and Access Act also includes a number of other provisions that would ease the financial burden imposed on students and families by the cost of college, including:
o Tuition assistance for excellent undergraduate students who agree to teach in the nation’s public schools;
o Loan forgiveness after 10 years of public service and loan repayment for college graduates that go into vital public service jobs;
o Landmark investments in Historically Black Colleges and Universities, Hispanic Serving Institutions and other minority serving institutions; and
o Strategies to help colleges contain costs and make online information on college costs for students and parents more user friendly.
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