| College Aid: An
Extraordinary Investment in Our Future  By Representative Mike Michaud
Taking
standardized tests, meetings with school councilors, attending college fairs, and visiting
schools are familiar activities to many students in their junior year of high school.
It’s a time when many students begin their college searches and consider what to do
after high school. It should be an exciting time for students and parents. Unfortunately,
for too many Maine families, it can also be a time filled with worries about how to afford
a college education.
We all want our
nation’s young men and women to have access to the best education. Every student
deserves the right to pursue his or her highest aspirations. However, a lack of financial
resources continues to prevent too many highly qualified students in our state from
attending college.
And it’s
no wonder the cost of higher education is so daunting. Taking inflation into account,
tuition at four-year public colleges has grown by 35 percent in the last five years. This
means that students and families are taking on increasing amounts of debt to pay for
college, and those prospective students are getting a good dose of sticker shock. The sad
reality is that each year, nearly 200,000 students in our country are holding off on going
to college, or skipping it altogether, because they can’t afford it.
This is simply
wrong, and it’s long past time that we do something about it.
Recognizing
that these costs are a major burden for most families, the House of Representatives passed
a bill on July 11 that will help our nation’s students and families afford higher
education. Called the College Cost Reduction Act, the legislation makes the single largest
investment in college financial aid since the 1944 GI Bill which opened the doors to
college for a generation of soldiers returning from World War II.
The College
Cost Reduction Act would boost college financial aid by approximately $18 billion over the
next five years. The legislation pays for itself by reducing federal subsidies paid to
lenders in the college loan industry by $19 billion. The bill also includes nearly $1
billion in federal budget deficit reduction.
The bill would
cut interest rates in half on need-based student loans. Like legislation passed by the
House earlier this year, the College Cost Reduction Act would cut interest rates from 6.8
percent to 3.4 percent in equal steps over the next five years. In Maine, about 21,000
students take out need-based loans each year so that they can attend a four-year public
school. The interest-rate changes that this bill makes could potentially save each of
these students $4,210 over the life of their loan.
The College
Cost Reduction Act also increases the maximum value of the Pell Grant scholarship. When
combined with other Pell scholarship increases passed or proposed by Congress this year,
the maximum Pell Grant would climb from $4,050 in 2006 to $4,900 in 2008 and $5,200 in
2011. This would restore the Pell’s purchasing power and help about six million low-
and moderate-income students.
The legislation
would also help to keep 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 income on loan repayments and by allowing borrowers in economic hardship to have
their loans forgiven after 20 years.
All combined,
this is a tremendous, historic step toward realizing the goal of making college affordable
for every qualified student in the country. With this bill, we are saying that no one
should be denied the opportunity to go to college because of the cost.
Rep Tom Allen
also backed this measure.
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