Signed into law by President George W. Bush on Sept. 27, the College Cost Reduction and Access Act will make higher education affordable to low-income students by providing them with more financial assistance, U.S. Rep. Sheila Jackson Lee, D-Texas, said Monday at the University Center North Patio.
"I am here to let you know that financial relief is on the way," Lee said. "The College Cost Reduction and Access Act provides about $20 billion in college financial aid at no new cost to taxpayers."
The act aims to strengthen the middle class by making college more affordable, Lee said.
The act is the largest increase in college aid since the GI Bill was implemented in 1944 to assist World War II veterans paying for higher education; the act will raise Pell Grant funds by $1,350.
Unlike loans, students who qualify for the Pell Grant do not need to repay it.
The goal is to increase the maximum amount of the Pell Grant, a federal financial aid award to $5,400 from the current annual $4,050 per student. The increase is expected to go into effect next September when fiscal year 2009 begins. The Pell Grant amount will increase for a period of five years until 2013. At the national level, financial aid is expected to double to approximately $25.2 billion in fiscal year 2007, according to the U.S. Department of Education Programs.
Lee said that the increase in the maximum Pell Grant award will allow more minorities to go to college. Forty-five percent of African-Americans and Hispanic students that attend four-year colleges depend on Pell Grants, she said. Approximately 4.5 million students depend on federal aid, and more than 70 percent of the Pell Grant funds go to students from families with incomes of $20,000 or less a year, Lee said.
"The Federal Pell Grant Program prides itself on providing need-based grants to low-income undergraduate and certain post-baccalaureate students to promote access to postsecondary education," Lee said.
The act will also help with federal student loans by cutting the interest rate in half from 6.8 percent to 3.4 percent over four years. Lee said that students would save $4,400 when the legislation is enacted. A loan would also be forgiven if a student cannot pay it all back within 25 years.
Students receiving loans that are involved in the law enforcement, military and public education fields will be given additional assistance. The act will allow students specializing in those areas of public service to have their loans forgiven, meaning they will not be required to pay back their loans.
The act will also encourage philanthropic participation to match financial grants students are awarded, although Lee did not elaborate on how the process would be implemented. The aim is to increase the number of low-income and first-generation college students, Lee said.
"I believe that this bill is going to help many students along different socioeconomic backgrounds be able to attend and afford college," Sam Dike, Student Government Association vice president, said.
Lee also said that she had been working with other university student government associations to provide students with better financial aid assistance.
In her speech, Lee said that she plans on meeting with the SGA to host a town meeting to address student concerns. Dike said that the meeting is expected toward the end of the semester but did not specify a date.
"No one should be denied the opportunity to go to college simply because of the price, yet unfortunately that has been what many American families have been forced to do," Lee said. "This new legislation has opened the doors to dreams of millions of you who are America’s future."
