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Cantwell Applauds Senate Bill to Prevent Student Loan Rate from Doubling, Invest in Key WA Transportation Projects

Press Release

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Location: Washington, DC

Today, U.S. Senator Maria Cantwell (D-WA) joined with a bipartisan majority of her colleagues in voting to approve a bill that supports key transportation projects in Washington state, including the ferry system, and prevents subsidized Stafford student loan interest rates from doubling on July 1.

The bill also includes an amendment (S. Amdt. 1825) supported by Cantwell that would extend for one year two key programs that provide support for rural schools and roads. The Secure Rural Schools and Community Self Determination Act (SRS) and the Payments in Lieu of Taxes (PILT) program are both extended through fiscal year 2013.

The Moving Ahead for Progress in the 21st Century Act (H.R. 4348) passed the Senate by a 74 to 19 bipartisan vote, sending the legislation to President Obama for his signature. The House approved the legislation just before the Senate by a 373 to 52 vote.

In Washington state, a doubling of the student loan interest rate from 3.4 percent to 6.8 percent would cost more than 100,000 college students $83 million more in loan payments. According to the Project on Student Debt, nearly 60 percent of Washington state 2010 college graduates carried debt. On May 8, Cantwell voted in support of legislation to prevent student loan rates from doubling. Cantwell is a cosponsor of S. 2051, which would prevent the rate hike and permanently cap the subsidized Stafford student loan interest rate at 3.4 percent.

"This vote is welcome news for 100,000 Washington students who faced dramatic increases in loan rates," Cantwell said. "In stopping these loan rates from doubling, we are sending a message that America is focused on investing in its future. Today's vote will help more Washington middle-class families to afford college and technical education."

The legislation includes funding for critical transportation, transit and freight projects through the end of fiscal year 2014. The Moving Ahead for Progress in the 21st Century Act will support Washington's existing highway and transit system and help the Washington State Department of Transportation plan for new and continued improvements for projects like US-12 in Walla Walla, the North Spokane Corridor or SR-520 bridge replacement.

"Washington state businesses rely on our transportation infrastructure to support jobs and stay competitive in a global economy," Cantwell said. "This critical transportation bill will support Washington jobs by investing in our roads, bridges, ferries, and railways. Today's vote helps to build a network that will support Washington's future economic growth."

In recent years, projects that have received federal formula transportation funding include:

the US 395 Blue Bridge project, a safety improvement project in the Tri-Cities region;
a rock slope stabilization project on SR 97A between Wenatchee and Lake Chelan;
safety improvements to the SR 529 Snohomish River Bridge, an important connection between Everett and Marysville;
a rock slope stabilization project on the west section of Stevens Pass to reduce rocks from falling on US 2;
safety improvement projects on SR 97/Status Creek to lessen the risk of vehicle collisions;
repairing and replacing damaged pavement on an important freight corridor for the Port of Tacoma -- I-5 between 48th Street and the Puyallup River Bridge;
repairing pavement on US 101, East of Hillstrom Road to South of Sol Duc Hot Springs Road, which is the only access road to communities such as Forks and LaPush, and tourist attractions such as the Hoh Rainforest, without having to drive all the way around the Olympic National Park;
repairing pavement on SR 112 from the Makah Indian Reservation to North of Green Creek Bridge -- the only road to and from the Makah Indian Reservation located out on the Northwestern tip of Washington state, which makes it extremely important in emergency situations;
and a project to expand the Advanced Traveler Information Service (ATIS) to include more comprehensive traffic data. ATIS provides travelers with up-to-date traffic info and wait times at the various border crossings in Whatcom County.
The legislation includes $134 million over two years in new, dedicated formula funding for ferry systems nationwide, which Senators Cantwell and Patty Murray (D-WA) both advocated for during Senate floor consideration of the bill. The Senators cosponsored an amendment on May 12th that laid the groundwork for the ferry provision included in the final transportation bill. Washington State Ferries is the largest ferry system in the United States and will be a large beneficiary of this new program. According to the Washington State Department of Transportation, the ferry system carries 10 million vehicles and more than 22 million people annually.

The bill also supports rural Washington state communities with one-year extensions at fiscal year 2011 funding levels of both SRS and PILT. Washington state is typically the fourth highest beneficiary of SRS payments in the nation. During fiscal year (FY) 2011, 27 counties in Washington state received about $24 million in SRS program funding to help fund schools, roads, search and rescue, and other important county programs. Top recipients include Skamania, Lewis, Okanogan, Chelan, Yakima, Ferry, Whatcom, Pend Oreille, Clallam, and Jefferson counties.

The Secure Rural Schools program expired September 30th. SRS program funding helps compensate for revenue lost from declining U.S. Forest Service timber harvests on federal lands near forest communities.

PILT compensates counties for federal land that cannot be a source of property taxes. During fiscal year 2011, 38 counties in Washington state received roughly $13.8 million in PILT payments. And during fiscal year 2012, 38 counties in Washington state received roughly $15.3 million in PILT payments. Top recipients include Chelan, Okanogan, Whatcom, Kittitas, Skagit, and Pend Oreille counties.

The FY12 payments are the last PILT payments to go out unless the program is reauthorized. With these funds, rural counties are able to invest in construction projects, roads, education, and forest conservation to make up for their inability to collect taxes on large swaths of public lands.

Cantwell joined 26 other Senators on May 10th in sending a letter to the Senate conferees negotiating a final transportation reauthorization agreement with the House urging the extension of both SRS and PILT.

Cantwell is a cosponsor of the bipartisan County Payments Reauthorization Act of 2011 (S. 1692), which would extend SRS for five years as well as fully fund PILT for five additional years. Washington state would receive as much as $103 million over the next five years under the plan.

"These programs provide crucial investments for roads and schools in Washington's forest communities," Cantwell said. "As rural counties continue to face financial hardships, this support helps maintain essential services, keep roads in working condition and keep teachers on the job. Moving forward, I will continue to advance our bipartisan legislation to provide longer-term certainty for Washington timber counties."

Out of all eligible counties in Washington state, Skamania County received the highest amount of Secure Rural Schools funding in FY11. The county received about $4.4 million.

"All of Washington state's timber counties appreciate Senator Cantwell's hard work to continue these payments to schools in our rural communities," said Paul Pearce, Skamania County commissioner and representative for the Washington Timber Counties. "The recession hit our communities especially hard, and these payments are a lifeline for our schools and communities. This deal that Senator Cantwell helped secure means 35 police, courts and administrative county jobs will be saved as well as 30 teacher and support staff jobs."

Under federal law, national forest land cannot be taxed by counties or other state and local jurisdictions. In place of taxes, a 100-year-old U.S. Forest Service policy shares revenue generated by timber harvests on federal lands near forest communities. Funds can be used for schools, roads, search and rescue, and other essential services. As timber harvests declined during the 1990s, hundreds of counties experienced a severe revenue loss. Since 2001, the SRS and PILT programs have helped areas hit hardest by declining timber sales, providing funding for schools and roads in communities nationwide.

Senator Cantwell has long been a supporter of the SRS and PILT programs. In 2007, she worked with her Senate colleagues to negotiate legislation to provide a one-year extension for PILT. She continued to work to negotiate a multi-year extension of both SRS and PILT, which ultimately passed the Senate in October 2008.

The 2008 law provided full funding for PILT for the first time and funded the program through fiscal year 2011, which ended September 30, 2011. The 2008 reauthorization provided more than $1.75 billion to counties across the country, including more than $250 million for collaborative forest and watershed restoration, wildfire risk reduction and other community forestry programs. The 2008 reauthorization also extended the SRS program through September 30, 2011, providing $500 million each year from 2008 to 2011 to rural school districts.

In 2008, Cantwell helped negotiate the final legislation that prevented steeper cuts to the program for Washington state counties. Under the 2008 law, payments to Washington state counties were initially increased dramatically and then -- like all other counties under the program -- were moderately decreased at a rate of 10 percent each year. Under the County Payments Reauthorization Act of 2011, the annual reduction would ease to 5 percent each year.


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