Boswell Votes To Reduce College Costs

Press Release

Boswell Votes to Reduce College Costs

Today, Congressman Leonard Boswell voted to approve legislation that would make the single largest investment in college financial aid since 1954, helping millions of students and families pay for college, and doing so at no new cost to U.S. taxpayers.

The College Cost Reduction Act of 2007, H.R. 2660, which passed the House by a vote of 273 to 149, would increase college financial aid by about $18 billion over the next five years.

"Students and their families all over the country are feeling the pinch of paying for college costs," said Boswell. "Tuition and fees at four-year public universities have increased by 40 percent since 2001. This legislation will help tremendously."

Under the bill, the maximum value of the Pell Grant scholarship would increase by $500 over the next five years. Combined with other increases recently passed by the House, the maximum Pell Grant would reach $4,900 in 2008 and $5,200 in 2011. Under the Bush Administration and the Republican-controlled Congress, the maximum grant award has been $4,050 for the past four years. Almost 77,000 students in Iowa could benefit from a $500 increase in the Pell Grant.

H.R. 2660 will also cut interest rates in half on need-based student loans, reducing the cost of those loans for million of student borrowers, cutting interest rates from 6.8 percent to 3.4 percent over the next five years. In Iowa, a student will see a reduction of $4,460 in interest over the life of a 4-year loan.

According to Iowa College Aid Commission, student loan debt in Iowa is much higher than the national average -- $27,238-- for public college students as opposed to $17,250 for college students nation wide.

The College Cost Reduction Act also includes a number of other provisions that would ease the financial burden of students and families, including:

Tuition assistance for excellent undergraduate students who agree to teach in the nation's public schools;
Loan forgiveness for college graduates that go into public service professions;
Increased federal loan limits
New tuition cost containment strategies; and
Landmark investments in Historically Black Colleges and Universities, Hispanic Serving Institutions and minority serving institutions.

The legislation pays for itself by reducing federal subsidies paid to lenders in the college loan industry by $19 billion. The Senate is expected to vote on similar legislation this month.

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