Conference Report on H.R. 2669, College Cost Reduction and Access Act

Floor Speech

CONFERENCE REPORT ON H.R. 2669, COLLEGE COST REDUCTION AND ACCESS ACT -- (House of Representatives - September 07, 2007)

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Ms. JACKSON-LEE of Texas. Mr. Speaker, I rise today in support of the Conference Report for H.R. 2669, the Education and Labor College Cost Reduction Act of 2007, the single largest investment in higher education since the GI Bill. This important legislation does far more than ease the burden of student loans for college graduates--it will make the American dream possible for low- and middle-income students, helping families pay for college. I would like to thank Chairman Miller for introducing the legislation, as well as his steadfast commitment to this important issue. May I also thank Speaker Pelosi for her visionary leadership in leading America in a new direction. I am proud to be part of a Democratic majority that delivers on its promises to the American people.

Mr. Speaker, in 21st century America, a college education is a critical investment toward individual success, as well as toward the strength of our nation. Higher education is associated with better health, greater wealth, and more vibrant civic participation, as well as national economic competitiveness in today's global environment. As the need for a college degree has grown, however, so has the cost of obtaining that education. The result is rising student debt. Students graduating often leave school with far more than knowledge and a degree; many face years of having their financial lives dictated by the burden of debt. Their choices of careers and jobs may be severely constrained by the necessity of repaying these loans.

This bill strengthens the middle class by making college more affordable: 6.8 million students who take out need-based federal student loans each year will see the interest rates on their loans halved over the next four years, saving the typical borrower (with $13,800 in need-based loan debt) $4,400 over the life of the loan, once fully implemented. With the recent sub-prime lending crisis and subsequent economic turmoil, the United States economy lost over 4,000 non-farm jobs in the month of August. More and more middle class students will be in need of assistance to turn their college dreams into a reality. This legislation makes student loan payments more manageable for borrowers by guaranteeing that borrowers will not have to pay more than 15 percent of their discretionary income in loan repayments. It also allows borrowers in economic hardship to have their loans forgiven after 25 years.

This Conference Report contains many important provisions that make significant strides toward making the dream of higher education a reality for more Americans than ever. It provides an increase in college aid by roughly $20 billion over the next five years, with no additional burden on American taxpayers. By cutting excessive federal subsidies to lenders, this legislation pays for itself.

This Conference Report contains a specific commitment to minority-serving institutions. It authorizes $510 million for Historically Black Colleges and Universities, Hispanic-Serving Institutions, Tribal Colleges, Alaska Native and Native Hawaiian institutions, and the newly designated Predominantly Black Institutions. These funds will work to ensure that students will not only enter college, but remain and graduate. About 2.3 million students attend minority-serving institutions, including 1/3 of all minority students who attend college.

This new investment is particularly critical for African-American students and their families. African-American students currently comprise about 12 percent of all undergraduate students. Many institutions have helped black students bridge ethnic-related economic barriers, making college education possible for underprivileged minorities. Among Historically Black Colleges and Universities (HBCUs), which give African American students an opportunity to have an educational experience in a community in which they are a part of the majority, costs are also rising. This resolution would support many of these honorable institutions in their righteous deeds in educatIng our underprivileged students of color.

In addition, this bill encourages and rewards public service. Students who pursue careers as public school teachers will receive upfront tuition assistance of $4,000 per year, to a maximum of $16,000,

providing aid to at least 21,500 undergraduate and graduate students. This is particularly important, given that 23 percent of public college and 38 percent of private college graduates have student loan debt that is unmanageable on the starting salary of a teacher. By providing the guarantee of assistance, this bill is an important step toward ensuring that there is a highly qualified teacher in each of America's classrooms.

Similarly, public servants will receive complete loan forgiveness after ten years of service. This will assist our driven young people who want to serve their country in the military, law enforcement, or as first responders, firefighters, nurses, public defenders, prosecutors, and early childhood educators. It ensures that dedicated Americans will not be precluded from serving their country because of a preponderance of debt.

Mr. Speaker, I also support the Conference Report for H.R. 2669 because it will increase the maximum Pell Grant award by $1090 over the next five years to $5,400. It will also increase eligibility by raising the income threshold, allowing more students from more families to automatically qualify for grants. The Federal Pell Grant Program prides itself on providing need-based grants to low-income undergraduate and certain postbaccalaureate students to promote access to postsecondary education. These grants are particularly important for students of color, with 45 percent of African American and Hispanic students at four-year colleges depending on Pell grants, compared to 23 percent of all students. Approximately 4.5 million students currently depend on Pell Grants and ``over 70 percent of Pell Grant funds go to students from families with incomes of $20,000 a year or less.'' Increasing the maximum Pell Grant Award will expand racial and ethnic diversity in higher education institutions, benefiting not only the institutions, cultural background but it will also be a great learning experience for students to learn diverse cultural backgrounds different from their own.

In addition, the Conferene Report for H.R. 2669 cuts the interest rates on subsidized student loans in half from 6.8 percent to 3.4 percent over five years. Once fully implemented, this cut would save the typical borrower--with about $13,800 in need-based loan debt--$4,400 over the life of the loan. By cutting interest rates on federal loans, Congress can

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save college graduates thousands of dollars over the life of their loans. Mr. Speaker, recent graduates, especially those of minority status with low to moderate incomes, must spend the vast majority of their salaries on necessities such as rent, health care, and food. For borrowers struggling to cover basic costs, student loan repayment can create a significant and measurable impact on their lives.

Crushing student debt also has societal consequences, according to a report by two highly respected economists, Drs. Saul Schwarz and Sandy Baum. The prospect of burdensome debt likely deters skilled and dedicated college graduates from entering and staying in important careers such as educating our nation's children and helping the country's most vulnerable populations.

To solve this problem and ensure that higher education remains within reach for all Americans, we need to increase need-based grant aid; make loan repayment fair and affordable; protect borrowers from usurious lending practices; and provide incentives for state governments and colleges to control tuition costs. H.R. 2669 is an important step in a new and right direction for America.

Last November, House Democrats promised a New Direction for America. This bill, the single largest investment to higher education, comes at no additional cost to American taxpayers, but brings extraordinary benefits for our nation. I am proud to be part of a Democratic majority that delivers on its promises to the American people.

I urge my colleagues to vote in favor of adoption of the Conference Report for H.R. 2669, the Education and Labor College Cost Reduction Act of 2007.

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