(WASHINGTON, D.C.) – Congressman Dennis Moore (Third District – Kansas) voted to approve legislation that would make the single largest investment in college financial aid since the 1944 GI Bill, helping millions of students and families pay for college – and doing so at no new cost to U.S. taxpayers.

The legislation, the College Cost Reduction Act of 2007 (H.R. 2669), which the House passed by a vote of 273-149, would boost college financial aid by about $18 billion over the next five years. The legislation pays for itself by reducing excessive federal subsidies paid to lenders in the college loan industry by $19 billion. It also includes nearly $1 billion in federal budget deficit reduction. The Senate is expected to vote on similar legislation this month.

“Too many students are faced with financial roadblocks to higher education that can be difficult to overcome,” said Moore. “This legislation will give those students in Kansas and across the country a better chance by expanding access to quality education without adding new costs to taxpayers.”

Under the legislation, the maximum value of the Pell Grant scholarship would increase by $500 over the next five years. When combined with other Pell scholarship increases passed or proposed by Congress this year, the maximum Pell Grant would reach $4,900 in 2008 and $5,200 in 2011, up from $4,050 in 2006, thus restoring the Pell’s purchasing power. About 6 million low- and moderate-income students would benefit from this increase.

Kansas students and families would see an increase of $151,000,000 over five years made available to them in the form of loan and Pell aid. It is estimated that about 6 million low- and moderate-income students nationwide would benefit from this increase in the maximum Pell Grant, including about 58,700 in the state of Kansas.

“The benefits going to students in the state of Kansas will be substantial,” Moore said. “We need to provide every opportunity to students so they can fully utilize the world-class higher education system our nation has. The future of our nation and our economy remaining strong depends on it.”

The legislation would cut interest rates in half on need-based student loans, reducing the cost of those loans for millions of student borrowers. Like legislation passed by the House earlier this year, the College Cost Reduction Act, which Moore cosponsored and voted for, the bill would cut interest rates from 6.8 percent to 3.4 percent in equal steps over the next five years. Once fully phased-in, this would save the typical student borrower – with $13,800 in need-based student loan debt – $4,400 over the life of the loan. About 6.8 million students take out need-based loans each year.

The legislation would also prevent student borrowers from facing unmanageable levels of federal student debt by guaranteeing that borrowers will never have to spend more than 15 percent of their yearly discretionary income on loan repayments and by allowing borrowers in economic hardship to have their loans forgiven after 20 years.

The College Cost Reduction Act includes a number of other provisions that would ease the financial burden imposed on students and families by the cost of college, including:

• Tuition assistance for excellent undergraduate students who agree to teach in the nation’s public schools;
• Loan forgiveness for college graduates that go into public service professions;
• Increased federal loan limits so that students won’t have to rely as heavily on costlier private loans;
• New tuition cost containment strategies; and
• Landmark investments in Historically Black Colleges and Universities, Hispanic Serving Institutions and minority serving institutions.

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.

Moore has long been a supporter of efforts to increase the accessibility and affordability of higher education. In the 109th Congress he was a cosponsor of the Student Loan Fairness Act, which would have repealed the restriction preventing people from reconsolidating or refinancing their student loans. During his time in Congress he has also been a champion of loan forgiveness programs for teachers and nurses.