By Cat Thoreson
The Student Debt Relief Act of 2007, which attempts to address the growing concerns of college graduates who are amassing a great amount of debt upon graduation, was introduced by the leadership of the Senate Health, Education, Labor and Pensions (HELP) Committee on Jan 22.
The act was proposed by Sen. Edward Kennedy (Mass.), and cosponsored by fellow Democratic Sens. Richard Durbin (Ill.), Joseph Lieberman (Conn.), Barbara Mikulski (Md.), Barack Obama (Ill.) and Charles Schumer (N.Y.).
Millions of students have to rely on loans to battle the growing cost of tuition. “Over the last five years, tuition at public colleges and universities increased by 35 percent,” said Rep. George Miller (D- Calif.), chairman of the House Education and Workforce Committee, in a press statement. “This represents the highest increase in any five-year period since 1976.”
Students and parents have long voiced their concerns about the issue, but all too often it has fallen upon deaf ears.
“College is a huge decision for students and not just for the obvious independence that we gain,” said Meghan Turnbaugh, a University sophomore. “It is a huge financial commitment that often comes with little or no financial help. It’s about time the government realized the burden that students face when coming to college.”
To the relief of many, the government has now taken an active interest, most noticeably among the Democrats, who plan to address the issue with tenacity.
One of the chief proposals of the Student Debt Relief Act is an increase in the amount of money awarded through Federal Pell Grants to qualified undergraduate students who are in the process of attaining a degree.
The legislation would increase the Pell Grant from $4,050 to $5,100 for the 2007 to 2008 academic year, and would subsequently increase in incremental steps thereafter. It would reach a maximum of $6,300 for the 2011 to 2012 academic year.
For many, including senior Kara Meekins, these provisions, although seemingly minimal, would make a world of difference. “It is hard enough to come out of college on your own, and support your basic needs with the little money you make. Any assistance they can give you to lessen this blow would be beneficial.”
Also proposed in the legislation, is the reduction of interest rates on new subsidized Stafford loans over a five-year period. These loans, which are awarded by the government based on financial need, do not accumulate interest until the repayment period begins. The Student Debt Relief Act would decrease the fixed interest rate from 6.8 percent to a fixed rate of 3.4 percent as of July 1.
Junior Max Cohen said the proposal is an “immense assistance” to college graduates. Even though students would still have to take out the loans to cope with the increasing cost of tuition, the decreased interest rates would not only “lessen the financial burdens that loom over your head, but ease the stress that comes with living on your own and supporting yourself.”
Other provisions of the Act include the forgiveness of federal education loans for public sector workers (which includes emergency management personal, government workers, public safety, law enforcement, public health officials, education employees and social workers) who have been employed for at least 10 years. It would also create a Fair Payment Assurance program, which would protect borrowers who have large federal student loan debts from unmanageable repayment requirements.