After the U.S. House of Representatives overwhelmingly approved the College Student Relief Act of 2007 Wednesday, Democrats in the Senate are promising to continue the fight to have the bill passed into law – in hopes of helping university students paying for school with loans improve their post-college financial situations.
The bill, which was introduced last year by House Rep. George Miller (D-Calif.), proposes to gradually lower interest rates on federal need-based Stafford loans for university students from the current rate of 7.14 percent to 3.4 percent by 2011. The proposal passed in the House with 356 votes in favor and 71 votes against – and if it is approved by the Senate, President George W. Bush must then sign the bill in order to put the reforms into effect.
“The overwhelming bipartisan vote shows that this is a priority for the 110th Congress,” U.S. PIRG Federal Higher Education advocate Luke Swarthout said.
Though Swarthout said the bill’s fate in the Senate is difficult to gauge, Emily Kryder, spokesperson for Rep. Lois Capps (D-Calif.), said the bipartisan vote in the House will send a message to the Senate that it must act in support of the reforms.
“When interest rates were raised by Congress last year, there was a strong outcry. People want to see this enacted,” Kryder said.
Swarthout said the Senate would probably use the bill as part of a larger effort to reform higher education by increasing grant aid and curtailing unmanageable debt.
Earlier in the month, senators introduced the College Opportunity Tax Credit Act of 2007, which seeks to increase the availability of need-based federal Pell Grants. This bill, along with the College Student Relief Act of 2007, is currently awaiting a hearing in front of the Senate Committee on Health, Education, Labor and Pensions.
Senator Edward Kennedy (D-Mass.), who chairs the committee, said he is sponsoring both bills in the Senate because of the urgency of what he says is a financial “crisis” for new graduates entering the job market.
“Again and again in recent years, the response of Congress and the administration to this crisis has been to respond with half-measures – or worse, with measures that actually made the crisis even worse,” Kennedy said in a speech last week.
The education reforms, however, are not without their opponents.
The White House released a statement Tuesday opposing the act, stating that the proposal would divert money away from grant programs for incoming college students and into programs for reducing post-college debt.
“College graduates have higher lifetime earnings, and can already take advantage of flexible repayment options available under current law and reduce the effective interest rate they pay through the existing tax deduction for student loan interest,” the statement said.