Bill increases federal student aid, caps student loan payments, and forgives student loan debt for those who enter public service jobs
Sep 07 2007
Washington, D.C. – U.S. Senators Barbara Boxer and Dianne Feinstein (both D-CA) today lauded final passage of the College Cost Reduction and Access Act Conference Report, legislation which boosts college aid by roughly $20 billion over the next five years. Both Senators have continuously worked to improve college accessibility and affordability for students and families in California.
Twenty years ago, the maximum Pell Grant covered 40 percent of costs for attending a four-year college in California. Today, it covers just 30 percent. This bill helps our students when they start out by increasing the maximum Pell Grant award from $4,300 today to $5,100 in fall of 2008 and $5,400 in fall of 2011. This provision is particularly important to California, which had over 584,580 Pell Grant recipients in the 2005-2006 school year -- more than any other state in the country.
Senator Boxer said, “No one should be denied the opportunity to go to college simply because of cost. The Pell Grant was created to help ensure that students from lower-income families have the opportunity to attend the college of their choice. Through increased Pell Grant awards and reduction in interest rates for student loans, we can help students make ends meet so they can focus on their studies and their future. An investment in college aid is an investment in California’s future.”
Senator Feinstein said, “The good news is that there is much-needed relief in sight. The Democratic Congress has passed a bill that would provide $20 billion in new financial aid to help make college more affordable. This means that California’s low-income students will now be eligible to receive a boost in their Pell Grant maximum awards, (from the current $4,310 to $5,400 over the next five years.) I’m also pleased that the bill includes a measure that Senator Boxer and I proposed to ensure that students attending community college or other low-cost institutions will now be eligible to receive Pell Grant aid at a level equivalent to their peers who attend four-year institutions. It is my hope that thousands of students who couldn’t otherwise afford a college education will now be given the means to do so.”
The final bill includes a measure introduced by Senators Boxer and Feinstein that eliminates the “tuition sensitivity” clause in the Pell Grant system, which unfairly prevents students who attend community colleges and lower-tuition institutions from receiving the maximum Pell Grant. This fix will help more students make ends meet so they can focus on their studies and their future.
The final bill also includes a Boxer provision to increase funding for the Department of Education’s highly successful Upward Bound program. The provision authorizes an additional $57 million for the program each year for four years—a total of $228 million—to fund Upward Bound programs which have a grant score of 70 or above and did not receive funding for Fiscal Year 2007. In California, 5,600 students participate in Upward Bound, which provides tutoring, mentoring and counseling on college entrance and financial aid applications to low-income and first-generation college bound students. For the 2006-2007 school year, $26.5 million in grant funding was awarded to 73 Upward Bound programs in California. However, eleven Upward Bound California programs did not receive funding in this year’s grant selection process.
Boxer said, “Upward Bound helps countless youth in California and across the nation realize the American Dream. Through much needed federal dollars, institutions of higher learning can continue to expand educational opportunities for low-income students.”
The College Cost Reduction and Access Act tackles the problem of student loan debt upon graduation by capping federal student loan payments at 15 percent of a borrower’s discretionary income. Currently, 46 percent of seniors at four-year colleges in California graduate with debt, owing on average $15,000 in student loans.
“Paying for college has become a major financial burden for millions of college students and their families. In California, nearly half of the State’s college graduates have student loan debt,” Senator Feinstein said.
The bill also includes a provision authored by Senator Boxer that creates an Asian American and Pacific Islander (AAPI) Higher Education Serving Institution designation. The AAPI designation would apply to approximately 86 colleges and universities nationwide, and would apply to approximately 40 schools in California.
The bill now goes to the President for his signature.