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The College Cost Reduction Act (H.R.2669) seeks to lower the cost of higher education by reducing lender subsidies by $19 billion and then investing those funds in programs that increase grant amounts to students, improve access to student loans, cut interest rates on student loans, provide for the repayment of parts of the loans through employment or service in areas of national need, and reward colleges for lowering costs to students.

Contents 1 Current status 2 Original bill summary 2.1 Student aid 2.2 Affordable student loans 2.3 Reducing the cost of college 2.4 Highly qualified teachers 2.5 Increasing college access 3 Passage 3.1 House 3.2 Senate 3.2.1 Changes to the bill 3.2.2 Final passage 4 Articles and resources 4.1 See also 4.2 References 4.3 External resources 4.4 External articles

Current status

The bill passed in the House by a vote of 273-149 on July 11, 2007. The Senate received the bill, and passed a slightly different version of it on July 20, 2007. Details of the changes can be found below.

On its 2007 House scorecard, National Journal rated a yes vote in roll call vote 613 as "L-3" (Liberal-3). Votes were rated either conservative or liberal and weighted 1 to 3. The scorecard gave the following description:

Increase financial aid for college students and reduce subsidies for student-loan lenders. July 11. (273-149)^[1]

Americans for Democratic Action, which supported passage of the bill, selected the House vote for their 2007 House scorecard, where they gave it the following description:

Passage of a bill to cut nearly $19 billion from subsidies to federal student loan lender, redirecting most of those funds to financial aid for students, colleges, and universities. The bill would reduce lenders’ special allowance payments and insurance rates and eliminate a lender “exceptional performer” incentive program. It would reduce the share of collection fees kept by student loan guarantee agencies and increase origination fees that lenders are charged for new loans. Over five years, the maximum Pell Grant would rise to $5,200, interest rates on subsidized student loans would be cut in half to 3.4 percent, and the aggregate federally- backed loan limit would be raised to $30,500 for undergraduate and $65,000 for graduate students.^[2]

On its 2007 Senate scorecard, National Journal rated a no vote in roll call vote 261 as "L-3" (Liberal-3). Votes were rated either conservative or liberal and weighted 1 to 3. The scorecard gave the following description:

Waive a procedural objection to providing legal immunity to people who report suspicious activities. July 19. (57-39; 60 votes required to waive the Budget Act)^[3]

On its 2007 Senate scorecard, National Journal rated a no vote in roll call vote 262 as "C-3" (Conservative-3). Votes were rated either conservative or liberal and weighted 1 to 3. The scorecard gave the following description:

Waive a procedural objection to denying Social Security benefits for illegal work. July 19. (53-44; 60 votes required to waive the Budget Act)^[4]

On its 2007 Senate scorecard, National Journal rated a no vote in roll call vote 269 as "L-3" (Liberal-3). Votes were rated either conservative or liberal and weighted 1 to 3. The scorecard gave the following description:

Waive a procedural objection to requiring photo identification for voters. July 19. (42-54; 60 votes required to waive the Budget Act)^[5]

On its 2007 House scorecard, National Journal rated a yes vote in roll call vote 849 as "C-1" (Conservative-1). Votes were rated either conservative or liberal and weighted 1 to 3. The scorecard gave the following description:

Instruct House conferees to accept a Senate provision stating that detainees at Guantanamo should not be transferred to the United States. September 4. (305-83) ^[6]

On its 2007 Senate scorecard, National Journal rated a no vote in roll call vote 258 as "L-3" (Liberal-3). Votes were rated either conservative or liberal and weighted 1 to 3. The scorecard gave the following description:

Waive a procedural objection to barring the Federal Communications Commission from implementing a "fairness doctrine" for broadcasters. July 19. (49-48; 60 votes required to waive the Budget Act)^[7]

Same for all scorecards:

• Name of bill: College Cost Reduction Act of 2007
• Chamber: U.S. Senate
• Roll call number: 260
• Congress number: 110th
• Session number: 1
• Vote link: U.S. Senate record vote 260, 110th Congress, Session 1

Scored vote
Scorecard: FreedomWorks 2007 Senate Scorecard	Org. position: Aye
Description: "To amend the National Labor Relations Act to ensure the right of employees to a secret-ballot workplace election. "Yes" votes scored." (Original scorecard available at: http://www.freedomworks.org/keyvotes/2007_senate.php)

Scored vote
Scorecard: National Journal 2007 Senate Scorecard	Org. position: Nay
Description: "Waive a procedural objection to prevent labor bargaining with a union that has not gained secret-ballot approval from a majority of employees. July 19. (42-54; 60 votes required to waive the Budget Act)" (Original scorecard available at: http://www.nationaljournal.com/voteratings/senate_votes.htm)

On its 2007 Senate scorecard, National Journal rated a no vote in roll call vote 260 as "L-3" (Liberal-3). Votes were rated either conservative or liberal and weighted 1 to 3. The scorecard gave the following description:

Waive a procedural objection to prevent labor bargaining with a union that has not gained secret-ballot approval from a majority of employees. July 19. (42-54; 60 votes required to waive the Budget Act)^[8]

On its 2007 Senate scorecard, National Journal rated a yes vote in roll call vote 272 as "L-1" (Liberal-1). Votes were rated either conservative or liberal and weighted 1 to 3. The scorecard gave the following description:

Increase financial aid for college students and reduce subsidies for student-loan lenders. July 20. (78-18) ^[9]

Original bill summary

Student aid

In the bill, Pell Grants are authorized at $840 million in FY 2008 and are set to rise to $2.6 billion by 2017. Individual grant amounts are increased by $200 per year through 2010, $300 per year through 2011 and $500 per year through 2012 and thereafter. Maximum grant amounts per student are $7,600 through 2009, $8,600 through 2010, $9,600 through 2011, $10,600 through 2012 and $11,600 through 2013.^[10]

Also, working students can receive support of $3,750 for 2010 and $6,000 by 2013. The amount is higher by about $600 per year for independent students without dependents other than a spouse. Means testing for grants would be simplified and the income threshold would be raised from $20,000 to $30,000. ^[11]

Affordable student loans

Interest rates on education loans granted after July 1, 2006 are set at 6.8% on the principal balance. The rate is gradually decreased until it reaches 4.4% by July 1, 2012. ^[12]

Federal insurance on student loans is raised from $5,500 to $7,500 with an aggregate cap raised from $23,000 to $30,500 for undergrads and from $65,500 to $73,000 for graduate students.^[13]

Allowances to lenders, where lenders can profit on the difference between the cost of the loaned money and the interest charged, is reduced to 1.79%. ^[14]

Collection fees are lowered from 23% to 16% of the amount collected. Fees paid by lenders to the government for administering the program are increased slightly from 0.5% to 1.0% on new loans. Non-profit and small lenders are exempt from the fee. ^[15]

Repayment of loans by service can be accomplished through service in an area of national need as long as there is no default on the loan before service. The employer may take over service of the loan or the loan may be canceled depending on the service. Early childhood educators in low-income communities, such as nurses, foreign language specialists, librarians, highly qualified bi-lingual teachers, child welfare workers, speech and language pathologists, and those in national service or public sector employment (police, fire, etc.) can have $1,000 forgiven yearly for five years. ^[16]

Income or financial hardship and post-active duty status can also be taken into consideration regarding loan repayment. ^[17]

Reducing the cost of college

The bill declares that no state may reduce the total amount it provides for public institutions of higher education for any academic year beginning on or after July 1, 2008, to an amount which is less than the average amount provided during the five most recent preceding academic years. ^[18]

Colleges that do not participate can be fined up to $25,000. Colleges that have a net cost lower than the preceding year can receive a 25% increase to Pell Grant recipients attending that school. ^[19]

Highly qualified teachers

The bill establishes a program to provide grants to institutions for payment to students pursuing a teaching career. The funds can be used to pay students' tuition, fees, housing, and room and board. Students must maintain a 3.25 grade point average in the first year, and must meet other criteria to qualify. Qualified applicants can benefit from loan tuition assistance of up to $4,000 per year.^[20]

Increasing college access

The bill invests in historically African American and minority colleges by providing grants to those institutions to increase enrollment, particularly in the fields of science, technology, engineering, and mathematics, as well as the physical sciences, computer science, and information technology. ^[21]

Passage

House

The bill passed in the House with the above provisions on July 11, 2007.

Senate

Changes to the bill

On July 20, 2007, the Senate passed an amended version of the bill. The bill differed from the House version in that it provided for additional grant activity. Students with the greatest need could be awarded a cost of attendance grant based on need minus the expected family contribution and any Pell Grant amounts already awarded.^[22]

Also amended were some of the loan forgiveness provisions to detail under what circumstances forgiveness could take place. Also, the provision in the underlying bill that would reduce from 23% to 16% the amount a collection agency could earn on the amount collected is raised to 24% on funds collected between 2003 and September 2007 but is then dropped to 16% thereafter.^[23]

Because the bill allows funds granted to states to be transferred to non-profit organizations that promote a better understanding and access to student loans and grants, the substitute requires that the non-profit recipient has been in existence before the bill is enacted and is operating offering information, assistance and other required activities.^[24]

The Senate considered waiving the Budget Act, thus clearing the way for a direct vote on an amendment to curtail certain Social Security benefits. The motion failed to garner the 60 votes necessary to move to the direct vote.^[25]

The American Conservative Union supported the motion and included it in the American Conservative Union 2007 Senate Scorecard. It gave the following description of the vote:

The Senate voted to continue to allow Social Security benefits to be paid for illegal and fraudulent work, including the work of illegal aliens. ACU opposes such payments and supported the effort to prohibit it. ^[26]

The Senate also considered waiving the Budget Act for another amendment, this one "to provide interim relief for shortages in employment-based visas for aliens with extraordinary ability and advanced degrees and for nurses."^[27]

The United States Chamber of Commerce, which supported the amendment, selected the vote for their 2007 Senate scorecard, where they gave it the following description:

In July, by a vote of 55-40, the Senate failed to attain the 60 votes necessary to waive the Budget Act to proceed with consideration of an amendment to H.R. 2669, the College Cost Reduction Act of 2007. The Chamber strongly supported the amendment, which would have provided temporary relief for companies in need of highly skilled workers by raising the H1-B visa cap to 115,000 for 2008.The Chamber represents numerous companies and organizations that need to bring highly skilled workers into the United States each year. It is imperative to reform the H1-B visa program and the employment-based green card system to ensure that American businesses remain competitive.^[28]

Final passage

Following the August recess, the Senate agreed to the conference report on the bill in a vote of 79 to 12 on September 7, 2007, and the House agreed as well later that day in a vote of 292-97.^[29]

The Drum Major Institute, which supported passage, selected the votes for its 2007 House scorecard and 2007 Senate scorecard where it gave the following description:

In today’s world, a college education is increasingly necessary to attain a middle-class standard of living. A college-educated workforce is also critical to the nation’s economic strength. Yet the cost of college, and the amount of debt students must take on to afford it, is rising rapidly. The value of federal student aid programs, such as Pell Grants, has failed to keep pace with rising college costs, while many states have reduced their support for public universities. As a result, nearly two thirds of students at four-year colleges must now borrow to finance their college education, and the typical student borrower now graduates with nearly $20,000 in debt—and some with much more. The prospect of taking on tens of thousands of dollars in debt deters some students, especially those from lower-income families, from pursuing college entirely. Meanwhile, the need to pay off costly student loans makes it impractical for many graduates to pursue public service careers in essential fields such as teaching or social work. For many young people, the burden of student loan debt makes it difficult to make ends meet on a daily basis, much less support a family or begin to save for retirement. Through its wide array of measures to make a college education more affordable—including the groundbreaking effort to encourage colleges not to raise tuition, while prodding states to strengthen their investment in higher education—this bill will help millions of American young people attend college and begin their working lives without such an overwhelming burden of debt.^[30]

Articles and resources

See also

References

1. ↑ "2007 Vote Ratings, National Journal, March 7, 2008.
2. ↑ ADA Today, February 2008.
3. ↑ "2007 Vote Ratings, National Journal, March 7, 2008.
4. ↑ "2007 Vote Ratings, National Journal, March 7, 2008.
5. ↑ "2007 Vote Ratings, National Journal, March 7, 2008.
6. ↑ "2007 Vote Ratings, National Journal, March 7, 2008.
7. ↑ "2007 Vote Ratings, National Journal, March 7, 2008.
8. ↑ "2007 Vote Ratings, National Journal, March 7, 2008.
9. ↑ "2007 Vote Ratings, National Journal, March 7, 2008.
10. ↑ Robert McElroy, “Managing America: Education,” TheWeekInCongress, July 13, 2007.
11. ↑ Robert McElroy, “Managing America: Education,” TheWeekInCongress, July 13, 2007.
12. ↑ Robert McElroy, “Managing America: Education,” TheWeekInCongress, July 13, 2007.
13. ↑ Robert McElroy, “Managing America: Education,” TheWeekInCongress, July 13, 2007.
14. ↑ Robert McElroy, “Managing America: Education,” TheWeekInCongress, July 13, 2007.
15. ↑ Robert McElroy, “Managing America: Education,” TheWeekInCongress, July 13, 2007.
16. ↑ Robert McElroy, “Managing America: Education,” TheWeekInCongress, July 13, 2007.
17. ↑ Robert McElroy, “Managing America: Education,” TheWeekInCongress, July 13, 2007.
18. ↑ Robert McElroy, “Managing America: Education,” TheWeekInCongress, July 13, 2007.
19. ↑ Robert McElroy, “Managing America: Education,” TheWeekInCongress, July 13, 2007.
20. ↑ Robert McElroy, “Managing America: Education,” TheWeekInCongress, July 13, 2007.
21. ↑ Robert McElroy, “Managing America: Education,” TheWeekInCongress, July 13, 2007.
22. ↑ Robert McElroy, "Managing America: Education," TheWeekInCongress, July 20, 2007.
23. ↑ Robert McElroy, "Managing America: Education," TheWeekInCongress, July 20, 2007.
24. ↑ Robert McElroy, "Managing America: Education," TheWeekInCongress, July 20, 2007.
25. ↑ OpenCongress' info page on College Cost Reduction Act of 2007
26. ↑ From American Conservative Union Description of Votes Scored.
27. ↑ THOMAS page on S.AMDT.2339.
28. ↑ Chamber of Commerce, "How They Voted 2007 - Senate".
29. ↑ Robert McElroy, "Managing America: Education," TheWeekInCongress, July 20, 2007.
30. ↑ From Drum Major Institute, "TheMiddleClass.org 2007 Congressional Scorecard"

External resources

• House Committee on Education and Labor
• 110th Congress/Democratic Party agenda
• 110th Congress

External articles