Democratic leaders on the House Education and Labor Committee on Thursday released proposed legislation to lower college costs that they say builds on the president’s student loan relief plan.
The Lowering Obstacles to Achievement Now (LOAN) Act would, in part, double the Pell Grant maximum award over five years to $13,000 and improve the Public Service Loan Forgiveness (PSLF) program by shortening the time to forgiveness and broadly codifying the PSLF waiver. Committee chair Rep. Bobby Scott (D-Virginia) and Rep. Frederica Wilson (D-Florida) — who leads the panel’s Higher Education and Workforce Investment Subcommittee — introduced the measure.
“While the President’s actions will provide urgent relief for millions of Americans who currently hold student loans, Congress’ work to support students cannot end until we address the root causes of the student debt crisis, including the declining value of the Pell Grant and our flawed student loan system,” said a press release from the committee.
Democrats said the legislation also would make loans less expensive by expanding access to subsidized loans and limit capitalization of interest, including after forbearance and deferment. It also aims to lower interest rates by tying interest rates for all new federal student loans to the 10-year Treasury note and ensuring that no new loan will have an interest rate higher than 5%.
House Republican leaders last month released their plan to help control college costs for students, which includes extending Pell eligibility to certain workforce development programs. Earlier this week, Rep. Virginia Foxx (R-North Carolina), the ranking member of the House Education and Labor Committee, blasted the president’s student loan cancellation plan and Democrats’ push to double Pell awards, but she said she was willing to take a bipartisan approach to address the college issues, especially through a reauthorization of the Higher Education Act.
