WASHINGTON, D.C. – Millions of college students and families will receive significant help paying for college next year under the economic recovery plan President Obama signed into law yesterday. The American Recovery and Reinvestment Act will immediately increase the Pell Grant scholarship by an additional $500 next year. The legislation will also provide students and families with a new, partially refundable college tuition tax credit of $2,500, among other things.
U.S. Rep. George Miller (D-CA), the chairman of the House Education and Labor Committee, today said that the law’s higher education benefits are an important down payment on President Obama’s goal of making college more affordable and accessible.
“President Obama’s economic recovery plan is a victory for college students and their families,” said Miller. “A sustainable economic recovery depends heavily on guaranteeing that our students can continue to have access to an affordable college education. This law will provide some much-needed relief to millions of students struggling to pay for college while their families are losing jobs, income and financial security.”
The law will provide immediate relief for college students in several ways:
These investments will also bring direct benefits for local economies across the country. College and universities create jobs, support taxes and generate spending on goods and services in states and communities. For example, colleges and universities in the Atlanta area supply 130,000 jobs and contribute $10.8 billion annually to the state’s economy. Each year, the University of Houston system generates over $3 billion in local economic activity and 24,000 local jobs. And in 2006, Nebraska’s 14 private universities and colleges spent about $521 million on goods and services – generating another $900 million in spillover effects for a total estimated benefit of $1.42 billion to the state’s economy.
Increasing student aid will help more students stay in college and more new students enroll in college – which in turn will help colleges and universities keep more jobs on the payroll and continue to serve as local economic engines.
For more information on student aid and other provisions included in the American Recovery and Reinvestment Act, click here.
“President Obama’s economic recovery plan is a victory for college students and their families,” said Miller. “A sustainable economic recovery depends heavily on guaranteeing that our students can continue to have access to an affordable college education. This law will provide some much-needed relief to millions of students struggling to pay for college while their families are losing jobs, income and financial security.”
The law will provide immediate relief for college students in several ways:
- Increasing the Pell Grant scholarship by $500. The bill increases the maximum award to $5,550 by next school year and to $5,000 for 2010. When combined with other increases enacted during the 110th Congress, the maximum Pell Grant award will have increased by $1,500 – or 37 percent – since January 2007.. About seven million students would benefit from this increase.
- Establishing a new college tuition tax credit of $2,500. The bill establishes a new, partially refundable “American Opportunity” tax credit, expanding access to a higher education tax credit to about four million students.
- Creating new work-study opportunities for college students. The bill invests $200 million in work-study opportunities for college students, creating jobs for an additional 133,000 students.
These investments will also bring direct benefits for local economies across the country. College and universities create jobs, support taxes and generate spending on goods and services in states and communities. For example, colleges and universities in the Atlanta area supply 130,000 jobs and contribute $10.8 billion annually to the state’s economy. Each year, the University of Houston system generates over $3 billion in local economic activity and 24,000 local jobs. And in 2006, Nebraska’s 14 private universities and colleges spent about $521 million on goods and services – generating another $900 million in spillover effects for a total estimated benefit of $1.42 billion to the state’s economy.
Increasing student aid will help more students stay in college and more new students enroll in college – which in turn will help colleges and universities keep more jobs on the payroll and continue to serve as local economic engines.
For more information on student aid and other provisions included in the American Recovery and Reinvestment Act, click here.
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