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Congressman Pascrell Gathers with Students and Graduates Who Would be Affected by the Pending Doubling of Student Loan Interest Rates

Press Release

Location: Washington, DC

Following Friday's House vote on Republican legislation that holds hostage the avoidance of a steep increase in Stafford student loan interest rates and guts preventative health care programs for women and children, U.S. Rep. Bill Pascrell, Jr. (D-NJ) today gathered with students and graduates from Passaic County Community College, Rutgers University, Montclair State University, William Paterson University who would be affected if the increase goes into effect. Unless Congress takes appropriate action, interest rates will double on July 1.

"House Republicans introduced a bill to address this issue. And what do they do? They make this about their political agenda," said Pascrell. a former educator who serves on the House Ways and Means Committee and House Budget Committee. "We need real relief and reform for student loan interest rates, not political theater. that is why I am an original cosponsor of H.R. 4816, the 'Stop the Rate Tax Hike Bill.' This legislation also stops the proposed hike in costs, but pays for it by closing tax loopholes for corporations. It's hard to fathom how anyone could hold tax breaks for the five biggest oil companies in higher priority than the health of women and children, as well as students and graduates striving to make their way in the world."

Dr. Steven Rose, president of Passaic County Community College, said that for years, students at the college were discouraged from taking out student loans to pay for associates degrees.

"Unfortunately, that is no longer possible," said Rose, citing a change in criteria that make Pell Grants more difficult for students to obtain. "If the interest rates on these loans go up, all we're going to be doing is putting up one more barrier for students who want to get a college education."

John Aspray, a Rutgers University graduate, said that he would not have been able to afford a college education without a Stafford student loan. But the prospect of a doubled interest rate presented a stark reality for everyone.

"We can't afford it. The students can't afford it. Society can't afford it," said Aspray, a member of N.J. United Students, statewide student association that works with student governments in getting students more engaged in public policy issues. "Education is something that should be accessible to all people regardless of class or socio-economic status. What we really need to do is provide support for students in terms of maintain a low reasonable interest rate on student loans. I really appreciate Representative Pascrell's work on this issue."

Joe Whitaker, a student at William Paterson University, said he also took out a Stafford student loan to finance his education.

"As I am about to enter the workforce, I'm about to graduate this semester, it's going to be felt," Whitaker said. "In order to tackle this issue properly, we really need to examine what is essential to not only to paying off our loans but also the importance of education."

Rep. Pascrell called upon his colleagues in Congress to pass H.R. 4816, a responsible bill that offsets the cost of avoiding a 100 percent increase in Stafford loan interest rates by ending tax breaks for the Big Five oil companies, which are enjoying record profits. Rep. Pascrell is an original co-sponsor of that legislation.

In 2007, Congress passed legislation that reduced the fixed rate on subsidized Stafford loans for undergraduate students from 6.8 percent to 3.4 percent over a four year period. However, unless this law is renewed, subsidized Stafford loan rates will double later this year, returning to the previous 6.8 percent rate.

The higher interest rate would mean a student who borrows the maximum $23,000 in subsidized loans would pay an additional $5,200 in interest over a 10-year repayment period or $11,300 over a 20-year repayment period. The legislation will keep Stafford loan rates at the current 3.4 percent interest rate.

Rep. Pascrell worked in Paramus as a public high school history teacher for 12 years, and also worked as an adjunct professor at Fairleigh Dickenson University in Teaneck. Before he was elected to public office, one of Rep. Pascrell's first public initiatives was a successful effort to urge state and local officials to establish Passaic County Community College in downtown Paterson. The point was to make the college's educational opportunities available to the greatest number of people possible.

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