Kennedy Fights To Open The Doors Of Opportunity For More Massachusettes Students

Press Release

KENNEDY FIGHTS TO OPEN THE DOORS OF OPPORTUNITY FOR MORE MASSACHUSETTS STUDENTS

Today, Senator Edward M. Kennedy, Chairman of the Senate Health, Education, Labor and Pensions Committee, released the following summary of how the Higher Education Access Act of 2007 will impact students in Massachusetts. Overall, under Kennedy's bipartisan bill, Massachusetts would receive over $317 million in new aid over five years.

"College education has become more important that ever," Senator Kennedy said. "Yet the cost of college has been rising faster than family incomes in Massachusetts and across the country, and federal financial aid has failed to keep up. As a consequence, many students are being shut out of college altogether because of unmet need. Others have been forced to rely heavily on loans to finance their college education. Significant student loan debt is increasingly distorting important life decisions, both professional and personal."

The high cost of college, combined with insufficient grant aid, is pricing many students out of a college education. Even with student loans and work-study programs, students can be confronted with thousands of dollars of unmet financial need that they cannot afford to pay. After all forms of aid-grants, loans, work-study, and other financial aid are taken into account, over 88,000 students in Massachusetts had an average unmet need of over $4,500.

The Higher Education Access Act of 2007 addresses these problems, immediately increasing the Pell the number of Pell grants recipients and the amount of aid, simplifies the financial aid process for low-income students, restricts the amount monthly student loan payments to 15% of their discretionary income, forgives the debts of those who commit to public service, and reforms the student loan system so it works for students, not banks.

THE HELP COMMITTEE HIGHER EDUCATION PACKAGE:
A NEW COMMITMENT TO MASSACHUSETTS STUDENTS

The Higher Education Access Act of 2007 and the Higher Education Amendments of 2007 will increase access to higher education and ensure that scarce federal dollars are going where they are most needed - to students. The Higher Education Amendments will also improve our K-12 schools by promoting effective teacher preparation programs.

Increasing Student Aid and Addressing Rising College Costs
The cost of college has tripled in the past 20 years, but federal financial aid has not kept up. The HELP Committee package will make college more affordable. The package:

• Increases access for low-income students by raising the maximum Pell Grant to $5,100 next year and to $5,400 by 2011 and simplifying the financial aid process for low-income students by increasing the income level at which a student is automatically eligible for the maximum Pell.
? After accounting for all grants and loans, 88,000 students in Massachusetts had an average unmet need of $4,500 in 2005.
? Under this package, Massachusetts will receive $36.9 million in new grant aid in 2008-2009. In all, Massachusetts will receive over $317 million in new aid over five years.
? The average Pell Grant award to Massachusetts students would increase by $440 in 2008 to $2,950.

• Helps borrowers manage student loan debt by capping monthly loan payments at 15 percent of discretionary income.
? 62 percent of 4-year college graduates in Massachusetts graduated with student loan debt in 2004-05, and the average amount was $18,169.
? Under this plan, a starting public school teacher in Massachusetts earning $35,421 with average student loan debt of $18,169, would see their monthly loan payment decrease by $61 - an annual savings of $732.
? A social worker with one child in Massachusetts, earning $47,830 and with average student loan debt of $18,169, would have his or her monthly payments reduced by $24, from $209 to $185 - a 12 percent reduction.

• Encourages public service by forgiving the student loans of borrowers who work for 10 years in public service careers, such as in law enforcement, emergency management, public health and social work, public education, public interest legal service, and public services for individuals with disabilities and the elderly.
? A public school teacher in Massachusetts would have $10,365 forgiven under this program.

• Protects working students and ensures they are not penalized by increasing the amount of student income that is sheltered from the financial aid process.

• Holds colleges accountable for rising costs by publicizing colleges whose cost increases outstrip those of their peers, and ensuring students and parents have access to objective data about the cost of college.
? There are over 140 postsecondary institutions in Massachusetts, and the Commonwealth is the only state in the nation that educates more students in private colleges than in public colleges.
? From 1996 to 2006, tuition and fees increased by 39 percent at UMass, by 29 percent at the State Colleges and by 9 percent at the Commonwealth's community colleges (after accounting for inflation).
? Similar trends are seen across the nation, especially in years when state appropriations to public colleges and universities have stagnated.

Simplifying the Financial Aid Process for all Students by Reforming the FAFSA
The Free Application for Federal Financial Aid (FAFSA) is currently seven pages long, and acts as a barrier to low- and middle-income students applying for the aid they need for college. The Higher Education Amendments will make the financial aid application process more student-friendly. The bill:

• Simplifies the FAFSA, by immediately creating a new 2-page EZ-FAFSA for low-income students, and phasing out the current 7-page FAFSA for all applicants within 5 years.
? More than 430,00 students are enrolled in private and public colleges in Massachusetts, and many will fill out a FAFSA each year.
? After all grants and loans are taken into account, approximately 88,000 students in Massachusetts had an average unmet need of $4,500 in 2005 - and even more students may never apply for aid, believing they can't afford the cost of college.

• Facilitates student planning by creating a pilot program that allows students to receive an aid determination or estimate in their junior year of high school.

Promoting Innovative Models in Teacher Preparation Programs
The nation faces a shortage of high-quality, well-prepared teachers, and it is often the neediest students who suffer the most. The Higher Education Amendments will improve teacher quality, training and retention. The bill:

• Promotes high-quality and effective teacher preparation programs for new and prospective teachers, including effective preparation, induction, and residency programs.
? Over 90 percent of mentors and beginning teachers who participated in induction programs in Massachusetts in 2002 reported that the program was highly important.
? Two thirds of beginning teachers and 84 percent of mentors reported in the same survey that these programs enabled the beginning teacher to perform at higher professional levels.

• Helps high-need schools, by focusing on recruiting and retaining high-quality teachers in these schools.
? This past school year, 95 percent of teachers in core academic subjects were highly qualified and 95 percent of teachers in Massachusetts public schools taught a subject in which they were licensed.
? However, in high-poverty schools, just 90 percent of teachers in core academic subjects were highly qualified and 92 percent of teachers were licensed in the subject they taught.

Reforming the Student Loan System so it Works for Students, Not Lenders
Recent investigations have shown that lenders and even some financial aid officers have been exploiting the student loan system, to the detriment of the students they are meant to be helping. The package will ensure the system works for students by:

• Protecting students by ensuring colleges recommend lenders to their students based on the best interest of students, not the self-interest of financial aid officers;

• Cleaning up the industry by prohibiting payments from lenders to schools/school officials that create conflicts of interest;

• Saving taxpayer dollars by using market mechanisms to cut outrageous subsidies to lenders, and redirecting these savings to students through the student aid increases above.

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