The College Cost Reduction Act of 2007 Passes House
On Wednesday the House approved H.R. 2669, the College Cost Reduction Act of 2007 with a vote of 273 to 149. The legislation, a budget reconciliation measure, would slash nearly $19 billion in government subsidies to lenders over five years, while increasing grants for needy students and halving interest rates on federally backed loans with the savings.
Terry Hartle, senior vice president for government and public affairs at the American Council on Education said “you are looking at the most substantial changes in the bank-based aid system since it was created in 1965.”
It has been reported that although President Bush opposed some elements of the bill, it is widely expected that a broad overhaul of student aid will become law this year.
In addition, the bill would:
• Make changes to help borrowers who have taken on unmanageable levels of debt.
• Provide tuition assistance to undergraduate students who make a commitment to teach in public schools in high-need subject areas or in underserved communities, and loan forgiveness for students who enter various careers in public service.
• Assign institutions a “college affordability index” based on a comparison of their rate of tuition growth to the Consumer Price Index.
The Senate education committee recently passed its version of the bill along with the Higher Education Act reauthorization, but they await consideration by the full Senate. There are differences between the Senate and House bills and some believe the drafting of an eventual compromise bill between the two chambers could be complicated. The negotiations are scheduled to take place sometime in the fall.
Labor-HHS-Education Spending Bill Passed by House Appropriations Committee
This week the House Appropriations Committee passed the FY 2008 Labor, Health and Human Services and Education Appropriations bill which provides an increase of $390 for the maximum Pell Grant. The Pell Grant spending increase is $2 billion above the 2007 spending level. It is expected that the Labor-HHS-Education bill will be on the House floor for a vote sometime next week.
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