Berry Votes for Single Largest Increase in College Student Aid Since GI Bill

Press Release

BERRY VOTES FOR SINGLE LARGEST INCREASE IN COLLEGE STUDENT AID SINCE GI BILL

Today Congressman Marion Berry (AR-1) along with a bipartisan coalition, passed a bill that would make the single largest investment in a higher education since the 1944 GI Bill. The bill will make college more affordable and accessible for millions of students and families with no new cost to U.S. taxpayers.

"As one of the wealthiest countries in the world, it is shameful a college education isn't easier to obtain," said Berry. "To compete in today's world, we must have well educated citizens and a well prepared workforce. This bill is an important and long needed investment in our nation's future."

The College Cost Reduction Act of 2007 which passed the House today will boost financial aid to low and middle income students by $18 billion over the next five years. The funding comes from rolling back excess subsidies paid to lenders in the student loan industry by $19 billion. The additional $1 billion will be used for federal budget deficit reduction.

In addition, this bill will increase the maximum value of Pell Grants by $500 over the next five years. When combined with other Pell scholarship increases passed or proposed by Congress this year, the maximum Pell Grant would reach $4,900 in 2008 and $5,200 in 2011, up from $4,050 in 2006. Approximately 6 million low and moderate income students would benefit from the increase.

The legislation would also cut interest rates in half on need-based student loans, which would reduce the cost of loans for the approximately 6.8 million student borrowers each year. The College Cost Reduction Act of 2007 would cut interest rates from 6.8 to 3.4 percent over the next five years. Once the bill is fully implemented, it would save the average student borrower who has $13,800 in need-based loan debt $4,400 over the life of the loan.

Additional provisions of the College Cost Reduction Act include:

- Tuition assistance for undergraduate students to teach in public schools after graduation

- Loan forgiveness for graduates who enter public service professions

- Increased federal loan limits to help students avoid more expensive private loans

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