Momentum Builds to Include Loan Reform in Health Bill

March 12, 2010

Democratic leaders in the U.S. House of Representatives and Senate edged closer Thursday to merging the Student Aid and Fiscal Responsibility Act into the budget reconciliation bill being drafted to push health care reform through Congress without Republican support. Among the provisions that would be included: the long-discussed end of the Federal Family Education Loan Program, in which private lenders receive subsidies for making loans to students, and the expansion of the Pell Grant program. At a news conference, the chairs of the House and Senate education committees vowed to ensure that the loan reforms would be included in the bill. Rep. George Miller (D-Calif.) said the chance to adjust federal funding for higher education was "a once-in-a-lifetime opportunity to change Washington and do the right thing, the fair thing, and the fiscally responsible thing for hard-working families."

Student advocates Campus Progress, the United States Public Interest Research Group and the United States Student Association sent a letter to Congress Thursday afternoon applauding the proposal. "We can no longer afford to waste billions on special interest subsidies while higher education budgets are cut, college costs skyrocket, and students and their families are struggling to afford a higher education," they wrote.

But news reports also indicated that Senate leaders seem intent on using a newer, and much lower, figure for determining the savings that the student loan reforms would generate. That decision, if it holds up, would mean that Congress would have much less money to distribute among the many would-be beneficiaries of the bill: community colleges, minority serving institutions, early childhood education programs, and, most prominently, needy recipients of Pell Grants.

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