- The Washington Times - Saturday, September 8, 2007

Congress yesterday approved legislation that cuts federal subsidies to student lender companies by nearly $21 billion and directs most of that money to grant programs, loan forgiveness and other efforts aimed at helping students.

The Senate approved the final measure, 79-12, with 43 Democrats, two independents and 34 Republicans voting for the bill. Only Republicans voted against it.

The House later approved it, 292-97, with 77 Republicans joining 215 Democrats in support of it.

“Today with this bill we’re sending a message and that message is that no qualified student will be denied a college education because of cost,” said Senate education panel chairman Edward M. Kennedy, Massachusetts Democrat.

Democrats worried that President Bush — who threatened to veto an earlier House version of the bill — would veto this final measure. But administration officials this week said that he will sign it.

“I am delighted that the president will join us in helping make this historic bill a reality for millions of students and their families,” House education panel chairman George Miller, California Democrat, said earlier in the week, after hearing the news.

White House spokeswoman Emily Lawrimore yesterday said Mr. Bush “does intend to sign it.” She said, “while it’s obviously not a perfect bill, we are very pleased that Congress answered the president’s call to significantly increase funding for the Pell Grant program.”

Some Republican critics said that is hardly enough to make the bill acceptable.

“I am deeply disappointed in the conference report we are considering and the process that was used to get here,” said top House education panel Republican Howard P. “Buck” McKeon of California.

The legislation would cut nearly $21 billion from federal subsidies given to student lending companies such as Sallie Mae. While $750 million of that savings would be used to reduce the deficit, the lion’s share would be redirected to a number of federal programs, private institutions and other efforts aimed at helping students pay for college.

It would increase the maximum Pell Grant award for students to $5,400 by 2012, cut the interest rate on some student loan repayments in half over the next four years, forgive the student loans of those who work in social service jobs for 10 years, provide tuition help to students who agree to teach in high-needs schools and fund efforts to recruit and retain more black and Hispanic college students.

Republican critics said the bill still dedicates far too much money to institutions, entitlement programs and students who have graduated, and far too little to the need-based Pell Grant program or to reducing the federal deficit.

They also criticized Democrats for using a special budget process to shield the legislation from a Senate filibuster. That process is normally used to cut federal spending and reduce government programs, but critics said Democrats used it to feed federal programs and increase the size of government.

“This bill … basically puts a stake through the heart of the budget process,” said Sen. Judd Gregg, New Hampshire Republican and former budget panel chairman.

Miss Lawrimore said the Bush administration still shares some of those concerns, including that the bill spends money on students who have graduated — through the interest rate cut — instead of giving more money to current students.

Still, she said, Mr. Bush sought $15 billion for Pell Grants and — after his veto threat in July — lawmakers raised the bill’s Pell Grant amount from about $6 billion to about $11 billion, indicating “the veto threat was extraordinarily effective.”

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