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Portland, OR -- Today Congressman Wu, surrounded by representatives from several Oregon universities and colleges, announced his higher education legislative package designed to make student aid more flexible for students and to help ease the financial burden of student loans.
"Borrowing for higher education should be a sound investment for the future, both for the student, and society," said Congressman David Wu. "Yet, today we are asking far too many students to mortgage their future at too high a cost."
According to the Department of Education, more than seven million students will take out a federal student loan this year to help finance their education. Over the past eight years, the typical student loan has almost doubled to $16,928. In addition, 39 percent of all student borrowers now graduate with unmanageable debt levels. This debt level means that too many student borrowers will struggle to make their monthly loan payments, and many must forego savings, public service careers, and major purchases.
To address this burden, Congressman Wu is introducing legislation to remove the restriction prohibiting students and graduates from refinancing their student loans. His legislation would also allow graduates to deduct the full amount of their student loan interest and remove the current income cap limiting the deduction. Current law only allows for $2,500 to be deducted, even though many students pay thousands more each year in student loan interest.
In addition to addressing the financial burden of higher education, Congressman Wu also aims to promote the 'dual-enrollment' partnership of Portland State University and Portland Community College on a national level. Such partnerships encourage students at community colleges to continue their education at four-year institutions. Congressman Wu's legislation would establish a competitive grant program to establish or expand community college partnerships throughout the United States.
Further, Congressman Wu sees the value in applicable, hands-on work experience during college and, therefore, is proposing legislation to expand the Federal Work-Study Program. His legislation would allow students to receive Work-Study financial aid for employment at private, for-profit businesses within their course of study. Current law only allows students to receive such financial aid for jobs on campus or off campus in the community service or non-profit sectors.
Congressman Wu's higher education plan is designed to provide common sense solutions to the problem of accessibility to higher education. The following is a breakdown of the bills, followed by testimonials:
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Student Loan Interest Full Deductibility Act: The Student Loan Interest Full Deductibility Act would allow eligible taxpayers to deduct the full amount of their student loan interest and would remove the current income cap limiting the deduction. Current law only allows for $2,500 to be deducted and phases out the deduction if a taxpayer's income is greater than $50,000 a year.
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Pell Grants: Congressman Wu is introducing legislation that calls for full funding of Pell Grants at their maximum authorized amount -- $5,800. Today's maximum amount of $4,050 is worth nearly $800 less than the maximum scholarship 30 years ago.
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Earning and Learning Act: The Earning and Learning Act is designed to make current federal financial aid programs more flexible. The current Federal Work-Study Program provides jobs for undergraduate and graduate students with financial need, allowing them to earn money to help pay education expenses. The Earning and Learning Act will allow students who are eligible for Federal Work-Study aid to work for private for-profit employers within their course of study. This will allow students to gain valuable experience while also receiving much-needed financial assistance.
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Community College Partnerships: The Community College Partnership legislation would create partnerships between community colleges and four-year institutions to aid in encouraging students to continue their education at a college or university. These partnerships would make the transition seamless through dual enrollment programs in which enrollees' class credits, financial aid, and administrative paperwork seamlessly transfer between the schools. The Community College Partnership Act would establish a $70 million competitive grant program to encourage or expand partnerships throughout the United States.
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Higher Education Act Paperwork Reduction and Flexibility: The Higher Education Act Paperwork Reduction and Flexibility legislation extends two major provisions in regards to financial aid disbursement. For low default rate colleges and universities, the bill allows schools to continue disbursing the entire amount of the student loan to first time borrowers in a single payment and waives the 30-day withholding requirement for first time borrowers. In short, this provision rewards low default schools by allowing their students to have access to their full loan amount to purchase books and supplies, pay housing costs and other associated educational startup expenses.
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College Textbook Pricing: Last year, Congressman Wu was successful in getting the Government Accountability Office (GAO) to investigate the high price of college textbooks and the disparity of prices between textbooks sold in the United States and overseas. Their report, which is set to be released this spring, will unmask the pricing of college textbooks, and Congressman Wu is planning to continue this investigation by formulating legislation that will take into account the GAO's findings.
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Congressman Wu's Higher Education Plan -
What Others Are Saying
"College affordability for Oregon students has decreased in recent years, due to declining state resources forcing higher tuition, and much lower than average state need-based grants. We applaud Congressman Wu's efforts at the federal level to ensure affordable and equal opportunity for Oregonians to pursue their college dreams."
George Pernsteiner, Acting Chancellor of the Oregon University System
"Congressman Wu's legislative agenda for higher education in Oregon targets access for students to all of the state's colleges and universities, both public and private. Allowing Oregon's students to have the option to attend the institution that best meets their educational goals and allowing them choices that they can afford are essential elements of the bills that the Congressman is proposing."
Phillip D. Creighton, President, Pacific University
"A college education means a chance for a better life, but many cannot afford it. Others achieve it by taking on staggering debt. The federal government plays an integral role in making post-secondary education accessible. I applaud Congressman Wu's efforts to strengthen student accessibility to higher education."
Dave Frohnmayer, President, University of Oregon
"Oregon is fortunate that Congressman Wu is in Congress fighting for our students, our universities, and our future. He is fighting to make higher education affordable for low-income students. He is fighting to provide universities, like PSU, with the funds we need to improve our programs. Congressman Wu is relentless in his work to make the American dream a reality for all and he knows that begins with an accessible, affordable, and high quality higher education system throughout the nation."
Daniel O. Bernstine, President, Portland State University
"Congressman Wu is working hard on behalf of Oregon students. I sincerely appreciate his effort to increase the access and affordability to college for all people. In particular, his priority for community college partnerships builds upon my priority to break down barriers from pre Kindergarten thru college for students of all ages. With Congressman Wu's help more Oregonians will be able to afford college."
Susan Castillo, State Superintendent of Public Instruction
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