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Congress moves to fulfill promises on higher education.

WASHINGTON -- The Democratic-controlled Congress is moving quickly to deliver on at least some of its promises to make higher education more affordable.

Leaders have reached agreement on a budget bill that would increase annual Pell Grant funding by $615.4 million to about $13.6 billion. The maximum grant would go up by $260, to $4,310, the first increase in four years.

The bill has been approved in the House and it has also been endorsed Sen. Robert Byrd, D-W.V., chairman of the Senate Appropriations Committee.

Other than boosting Pell Grants, however, the budget bill would keep higher education funding at current levels. The measure also eliminates earmarks, so no community college would be able to get a special grant added to the bill by their local representative.

However, the federal Department of Education will get about the same amount of money as last year, so representatives and senators could pressure education officials to give special grants to community colleges.

The moves in Congress may represent only the beginning of the drive to boost Pell Grants, the country's largest need-based scholarship program.

Congressmen have shown considerable interest in boosting the program. Rep. David Wu, D-Ore., has introduced a non-binding resolution that would express the sense of the House that the maximum Pell Grant size should increase to $5,800.

Rep. Eddie Bernice Johnson, D-Tex., has introduced the Children of Fallen Soldiers Pell Grant Act of 2007. It would end the expected family contribution for students whose parent or guardian was killed in military service in Afghanistan or Iraq when calculating Pelt Grant eligibility. The measure would effectively make everyone in the group eligible for Pell Grants.

Meanwhile, legislation to slash student loan interest rates in hall, which sailed easily through the House, is encountering rougher seas in the Senate.

The House approved the College Student Relief Act of 2007, which would lower the rates on most college loans from 6.8 percent to 6.12 percent next July 1, and then to 5.44 percent in July 2008, 4.76 percent in July 2009, 4.08 percent in July 2010, and 3.44 percent in July 2011.

But unless Congress acts to extend the rates, they would go right back up to 6.8 percent in 2012.

Also. though President Bush hasn't said he would veto it, the White House issued a statement of opposition.

The statement said "student debt loads have soared in recent years, and it is not clear that encouraging more loans is a wise course. Instead, the administration would support efforts to direct savings to additional grant support or low-income students. Furthermore, encouraging more student debt can also fuel today's upward tuition spiral."

The House-passed bill would cost taxpayers about $6 billion. The legislation aims to cover the cost by reducing the government's guaranteed return to lenders that make student loans, cutting back the amount the government pays for defaulted loans and requiring banks to pay more in fees.

Sen. Edward M. Kennedy; D-Mass., chairman of the Senate health and education committee, and Sen. Richard Durbin, D-Ill., introduced the same provisions in the Senate. But the Senate may rake a closer look or delay the measure, as the sponsors added other student aid provisions to it and sent it for committee review. The bill sailed through the House on a 356-71 vote without committee review or even a chance to offer amendments.

Kennedy's Student Debt Relief Act of 2007 would increase Pell Grants in increments over five years, to a maximum of $6,300. To accommodate the increases, it would increase funding by approximately $4.3 billion the first year, $5.7 billion the second, $7.1 billion the third, $8.5 billion the fourth and $9.9 billion the fifth.

Kennedy's bill would also encourage colleges to use less-costly Direct Loans instead of private Federal Family Education Loans. The bill would also increase the college expense tax deduction from $4,000 to $12,000, and abolish the rule prohibiting students from consolidating loans while they remain in college.

But the Senate parliamentarian referred the bill not to Kennedy's education committee but to the finance committee. Sen. Max Baucus, D-Mont., finance committee chairman, has stated he backs legislation to increase tax deductions for tuition and other educational assistance.

Baucus said he will introduce legislation similar to the Education Competitiveness Act he sponsored last year.

That bill would have provided tax breaks for student loan repayments. It would have increased the student loan interest tax deduction from $2,500 to $3,000 and allowed employers to provide up to $7,000 in tax-free education assistance annually per employee. It also would have guaranteed free tuition to math. science and engineering majors.

Baucus also sponsored a measure the Senate approved 900 to the Fair Minimum Wage Act which endorses, without a legal commitment, a sense that "Congress should make permanent the tax incentives to make education more affordable and more accessible for American families" and eliminate "waste" and tax loopholes to pay for it.

Also on the Senate side, Sen. Jeff Bingaman, D-N.M, introduced the Greater Access to Education Act, which would expand the Hope Scholarship Tax Credit program to cover expenses including room and board, fees, books, supplies and equipment. Currently, it only covers tuition.

Wu, meanwhile, introduced several higher education bills. His Community College Partnership Act of 2007 would authorize $50 million for grants to help community and technical college students transfer to four-year colleges. Partnerships involving states and both two- and four-year institutes could get money to develop transfer policies, provide support services to students, identify barriers to transferring and encourage dual enrollment.

Wu's Earning and Learning Act of 2007 would require colleges to involve for-profit companies in work-study programs. His Student Loan Interest Full Deductibility Act would allow all interest on student loans to be tax deductible. Another bill would authorize $30 million in grants for colleges serving Asian Americans and Pacific Islanders.

Also, Rep. Stephanie Tubbs Jones, D-Ohio, introduced the Collegiate Housing and Infrastructure Act of 2007. It would allow the creation of non-profit corporations solely to provide grants to build housing and other infrastructure primarily for fulltime college students

Rep. Stephen Lynch. D-Mass., introduced the Military Education Parity Act of 2007, which would ensure that reservists and National Guard members called to active duty would not lose class credits or forfeit scholarships and grants by requiring colleges to freeze their educational standing.

Minority Republicans are also introducing ideas to help students pay for college.

Rep. Joe Knollenberg, R-Mich., introduced the Student Financial Readiness Act of 2007, which would increase the maximum annual contribution to Coverdell Education Savings Accounts from $2,000 to $5,000 and allow for annual inflation adjustments. But the bill would prohibit contributions from people with adjusted gross incomes of $150,000 or above, or $300,000 for married couples filing jointly.

And the bipartisan duo of congressmen Rep. Earl Pomeroy, D-ND, and Rep. Phil English, R-Penn., introduced H.R. 686, which would make the $4,000 annual college tax deduction permanent. The law was set to expire last year but in one of its last acts, the last Congress extended it through this year. Thirty-five other members from both parties have signed on as cosponsors.
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Title Annotation:dateline washington
Author:Pekow, Charles
Publication:Community College Week
Date:Feb 12, 2007
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