Berkley Votes for Historic Boost in College Aid
for Nevada Students and Families
Package Will Make College More Affordable for All Americans
CONGRESSWOMAN SHELLEY BERKLEY (D-NV) today [September 7, 2007] voted in favor of landmark legislation that will help students and families in Nevada and nationwide pay for the cost of a college education. The College Cost Reduction and Access Act, which passed with bipartisan support, now goes to the President's desk for his signature.
"This is the single biggest investment in college aid since the GI bill and Democrats are delivering on our promise to lower the cost of education for more American families. As a former Nevada University Regent, and a proud UNLV graduate, I have seen first hand the doors that a higher education opens for men and women of all ages, and this important legislation will help more Americans earn their college diplomas," said Berkley.
The College Cost Reduction and Access Act combines key elements from House and Senate bills that were passed in July. The legislation, H.R. 2669, boosts college financial aid by more than $20 billion over the next five years. The bill pays for itself by reducing excessive federal subsidies paid to lenders in the college loan industry by $20.9 billion.
"This record investment in our nation's students comes at no new cost to U.S. taxpayers, but it will benefit countless families in Las Vegas and other communities who stand to save thousands of dollars as a result of the interest rate cuts included in this bill. There is also a much needed increase in Pell Grant limits which will preserve the purchasing power of these valuable scholarships that are helping nearly 17,000 Nevada students, the majority of whom are from households with families earning under $30,000 annually," said Berkley.
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. More than five million low- and moderate-income students will 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 prevents 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:
- Tuition assistance for excellent undergraduate students who agree to teach in the nation's public schools;
- Loan forgiveness after 10 years of public service and loan repayment for college graduates who go into vital public service jobs;
- Landmark investments in Historically Black Colleges and Universities, Hispanic Serving Institutions and other minority serving institutions; and
- Strategies to help colleges contain costs and make online information on college costs for students and parents more user friendly.
