Loan forgiveness, payment caps and increased Pell grants included in bill awaiting presidential approval
On Friday, the U.S. Senate passed the College Cost Reduction Act, which will provide over $465 million in additional grants and loans over the next five years to help Colorado students afford higher education.
The bill, H.R. 2669, has been passed by both the U.S. House of Representatives and the Senate and now goes to President Bush for his signature.
U.S. Senator Ken Salazar, who supported the passage of the bill, said in a release Friday that, “In a competitive global economy, a college education is more important than ever.”
Salazar said that the cost of college is quickly outpacing many family incomes and federal aid is not keeping up.
“The rising cost of college has put the dream of a college education out of reach for many young people,” he said. “More and more students that put their education first, end up graduating with unmanageable debt.”
The cost of college in Colorado has increased nearly 40 percent in the last five years alone. Many college graduates are leaving school with more than $15,000 in debt, and many Colorado families are using significant amounts of their income, in addition to financial aid, to pay tuition.
The bill will increase need-based grant aid for low-income students by increasing the maximum of the Pell grant by $500 next year and to $5,400 by 2012 for eligible students.
“The bill also hopes to help contain college costs and increases federal loan limits to provide borrowers with additional assistance.” Salazar’s press secretary, Stephanie Valencia, said.
According to Gwen Pomper, director of financial aid at CU, Pell Grants are targeted toward students who are less capable of paying for higher education.
Salazar also noted his own experience with federal financial aid.
“Federal student aid programs gave me the chance I needed to achieve success,” he said. “I believe we should provide all Americans with that same opportunity,”
The bill will also help graduates with excessive loans by putting a cap on the federal student loan payments at 15 percent of the borrower’s discretionary income and allow borrowers to have their loans forgiven after 20 years.
Contact Campus Press Staff Writer Sarah Ruybalid Sarah.Ruybalid@colorado.edu
