Rep. Clarke Backs Bill to Make College More Affordable
As the cost of a college education continues to rise across the country, U.S. Rep. Yvette D. Clarke (NY-11), today joined a bipartisan majority in the House in support of legislation that would make college more affordable and offer the single largest investment in college financial assistance since the 1944 GI Bill at no new cost to U.S. taxpayers. The Senate also approved the bill, the College Cost Reduction and Access Act, today. The bill now goes to President Bush, who is expected to sign the bill into law.
While family income has failed to increase, the cost of living and the cost of a college education have continued to rise, placing added pressure on aspiring college students and their families, and preventing some students from attending college. The College Cost Reduction and Access Act would boost college financial aid by more than $20 billion over the next five years and cuts interest rates on subsidized student loans in half over the next four years. The bill pays for itself by reducing excessive federal subsidies paid to lenders in the college loan industry by $20.9 billion. It also includes $750 million in federal budget deficit reduction.
“Families in central Brooklyn are sending their children to college and when they graduate, they should not be saddled with debt,” said Rep. Clarke. “Last year, Democrats pledged to bring down the cost of a college education and today, we made good on our promise.”
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. Close to 6 million low- and moderate-income students across the country 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. The rate cut will save the typical student borrower a total of $4,400. About 6.8 million students take out need-based loans each year.
In addition, the legislation would prevent students 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.
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