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On Sept. 7, Congress passed a reform bill that will help students nationwide. The College Cost Reduction and Access Act, if signed by the president, will increase Pell Grant awards and cut interest rates on student loans.
“In Maine we will see a great impact because of the increased rates of Pell Grants. Maine is a state where a lot of people qualify for Pell Grants,” said Emily Cain, representative in the Maine State legislature. “It will go a long way in helping reduce the amount of debt that students in Maine feel they need to take on and must take on in order to complete their college education in Maine.”
This reform would allocate more than $2 billion to help relieve student education costs in 2008. This figure would increase to nearly $5 billion by 2017. This money would go toward increasing the amount of money students could receive in a Pell Grant. The 2008 increase would be $490 and would reach $1090 by 2012.
“The bill trims excessive subsidies that benefit a handful of banks and directs them to millions of students and families who are working to pay for college,” said Sean Rankin, a student senator. “The bipartisan votes for this legislation, and the president’s pledge to sign it into law, are testament to the broad support for helping students and families pay for college.”
This act will also create a program which allows student loan borrowers to pay back their loans in a different way. Instead of having to pay back a percentage of the loan each month, this act would have borrowers pay back their loans based on a percentage of their income. This would help low income borrowers from becoming more in debt.
“The Act, passed Friday, will provide billions of dollars a year in additional grant aid to low-income students and reforms to help lower student loan debt,” Rankin said “The investment in education is paid for by lowering subsidies to private banks, at no new cost to taxpayers.”
The only person who can stop this from going into law is President Bush. “The federal government’s role has always been to help those students most in need,” U.S. Department of Education Secretary Margaret Spellings said in a press release.
According to the U.S. Department of Education’s federal student aid Web site “The programs we administer comprise the nation’s largest source of student aid: during the 2005-06 school year alone, we provided approximately $78 billion in new aid to nearly 10 million postsecondary students and their families.”
