Senator Jay Rockefeller today issued the following statement after President Obama signed into law the Bipartisan Student Loan Certainty Act of 2013. The law cuts rates on all new student loans issued this year and promises to save a typical undergraduate $1,500 over the life of those loans.
"While the law President Obama signed today isn't perfect, I'm glad students are finally getting some much-needed relief from skyrocketing student loan rates," said Rockefeller. "I do think this is a step in the right direction but, as I've said before, we can't let this short-term fix be the end of the student loan debate. I will keep pushing to make higher education more affordable because all young people in this country must have the opportunity to pursue a higher education."
The Bipartisan Student Loan Certainty Act of 2013 will initially decrease student loan interest rates but, in the future, fixed rates would be determined annually by market conditions. The law also includes caps on how high student loan interest rates can rise. The Congressional Budget Office (CBO) estimates the bill will save $715 million over ten years.
Earlier this year, Rockefeller helped introduce the Keep Student Loans Affordable Act -- in contrast to the new law, this legislation would have reversed the recent rate hike on new subsidized Stafford student loans by retroactively setting the interest rate to 3.4 percent for any subsidized Stafford loan made between July 1, 2013 and June 30, 2014. The bill did not have enough support to pass the Senate.
According to the West Virginia Center on Budget and Policy, the average debt of a graduate of a West Virginia four-year public college is now more than $25,000 -- a level that has grown by $10,000 since 2004. This exceeds the current national average of $23,065 of student loan debt per graduate of four year public colleges.
For the upcoming 2013-2014 school year, more than 67,000 West Virginia students have already taken out federal subsidized Stafford loans. According to the New York Federal Reserve Bank, West Virginia has the highest student loan delinquency rate in the nation at approximately 18 percent, compared to the national average of 11 percent.