 |
Written by: Shelley Rodgers
Published: 03/16/2005 Bipartisan Group of Lawmakers Introduce New Student Aid Bill
A bipartisan group of lawmakers from the House and the Senate held a press conference on Capitol Hill March 15, 2005 to introduce the Student Aid Reward (STAR) Act of 2005. Congressional Budget Office’s preliminary estimate forecasts that the bill would provide more than $17 billion in need-based federal student financial aid to campuses across the Nation over the next 10 years.
“This bill will make college more affordable without costing taxpayers another nickel,” said Rep. Miller, the senior Democrat on the House Education and the Workforce Committee and one of four sponsors of the bill. “Our bill puts students and families first. At a time when millions of families are struggling to pay for college, our plan makes college more affordable without increasing the already unmanageable federal budget deficit.”
The STAR Act calls upon the U.S. Secretary of Education to determine which of the two federal student loan programs—the Family Education Loan Program (FFEL) and the William D. Ford Direct Loan Program (DL)—is less costly to the government and taxpayers. It then would reward additional student aid funds to schools that switch to or currently participate in the more fiscally efficient loan program. While the act does not specifically identify which of the two loan programs it deems most efficient, President Bush’s 2006 education budget notes that student loans made through the FFEL program, which uses a complex set of subsidies to private lenders, guaranty agencies, and secondary markets to issue federally-insured student loans, cost $11 more for every $100 loaned than the same loans made directly with U.S. Treasury dollars in the Direct Loan program.
All four sponsors of the STAR Act—House Reps. George Miller (D-Calif.), Rep. Tom Petri (R-Wis.), Sen. Ted Kennedy (D-Mass.) and Sen. Gordon Smith (R-Ore.)—spoke at the press conference. Additional speakers included students from the U.S. Student Association (USSA), the U.S. Public Interest Research Group (U.S. PIRG) and the Minnesota State University Student Association (MSUSA). Several higher education associations including the National Association of College Admission Counseling (NACAC), the Association of Jesuit Colleges and Universities, USSA, U.S. PIRG, MSUSA, the American Federation of Teachers, The American Medical Student Association/Foundation and AACRAO submitted letters of support for the legislation.
“The Act would provide billions of dollars of new need-based aid for lower- and middle-income students without increasing the federal deficit. Rather than tapping new federal resources to fund the increased grant aid, the bill would use the federal savings generated by those institutions that voluntarily opt to participate in the more efficient federal student loan program,” reads the AACRAO letter. “We applaud your efforts to carefully craft the bill so as to preserve institutional choice, provide a new option for a significant expansion of much-needed grant aid, and conform to the demand of those policymakers who view budget-neutrality as a pre-condition of any improvements to the HEA.”
Should the STAR Act gain support from additional legislators, it would likely be considered as part of Congressional efforts to reauthorize the Higher Education Act later this year.
###
Related Links:
|
|
|
|
