Washington, DC – Congressman Snyder announced today that Congress sent H.R. 2669, the College Cost Reduction and Access Act, to the President’s desk for his signature.  This legislation makes college more affordable and provides the single largest investment in college financial assistance since the 1944 GI Bill. The college aid legislation bill, H.R. 2669, was passed by overwhelming bipartisan majorities in both the House and the Senate on September 7.  The Administration has announced that the President will sign the bill. 

The College Cost Reduction and Access Act will boost college financial aid by more than $20 billion over the next five years and cuts interest rates on subsidized student loans in half over the next four years. The bill, at no new cost to U.S. taxpayers, pays for itself by reducing excessive federal subsidies paid to lenders in the college loan industry by $20.9 billion.  It also includes $750 million in federal budget deficit reduction.

“Arkansas’ families should not be saddled with debt from sending their children to college when they graduate,” said Congressman Vic Snyder. “This legislation will bring down the cost of a college education and make student loan payments more manageable.” 

Under the legislation, the maximum value of the Pell Grant scholarship will increase over the next five years, reaching $5,400 by 2012. Close to 6 million low- and moderate-income students across the country would benefit from this increase.

About 6.8 million students take out need-based loans each year. To reduce the cost of loans for millions of student borrowers, the legislation will cut interest rates in half on need-based student loans, from 6.8 percent to 3.4 percent over the next four years. The rate cut will save the typical student borrower a total of $4,400.

In addition, the legislation guarantees that borrowers will never have to spend more than 15 percent of their yearly discretionary income on loan repayments and allows borrowers in economic hardship to have their loans forgiven after 25 years.  This provision will prevent students from facing unmanageable levels of federal student debt.

The College Cost Reduction and Access Act also includes a number of other provisions that will ease the financial burden imposed on students and families by the cost of college.
 
President Franklin Roosevelt signed the GI Bill into law in 1944. The original law enabled 7.8 million veterans of the Second World War to participate in education or job training programs.