ACA UPDATE: House Passes Student Aid Bill: Includes Loan Forgiveness for Counselors!
LaMarr
for Counselors!
This week, the U.S. House of Representatives passed sweeping
legislation that would make some of the biggest changes in student-aid
policy in a generation by slashing nearly $19-billion in government
subsidies to lenders and using the savings to expand federal
assistance to students, make college loans more affordable, and reduce
the federal deficit. The bill, H.R. 2669, the "College Cost Reduction
Act of 2007," passed by a vote of 273 to 149.
The legislation, a "budget reconciliation" measure, would cut
government subsidies to lenders by a little over half a percentage
point and raise the maximum Pell Grant award by $500 over four years.
It would also reduce by half the interest rate on federal student
loans for undergraduates over five years, and make several changes
aimed at helping borrowers who have taken on large amounts of debt,
including providing loan forgiveness for counselors!
H.R. 2669 includes a manager's amendment that specifically adds school
counselors who work full-time in a low-income (i.e., Title 1) school
to a list of individuals eligible for limited federal student loan
forgiveness under the Higher Education Act. The amendment was
sponsored by Rep. George Miller (D-CA) who chairs the House Education
and Labor Committee. Under the House bill, an "eligible borrower"
would receive up to a maximum of $5,000 in loan forgiveness for an
outstanding Federal Stafford Loan or Federal Direct Stafford Loan, on
a first-come, first-served basis, and subject to the availability of
appropriations. "An eligible borrower" is defined as someone with NO
outstanding balance on a FFEL or Direct Loan as of the date of
enactment of the law, and who has been employed full-time for at least
5 consecutive, complete school, academic, or calendar years as a
school counselor in a Title 1 school.
In addition, H.R. 2669 would provide loan forgiveness for eligible
Federal Direct Loans borrowers who have been "public sector" employees
for 10 years AND made 120 income contingent payments on their Direct
Loans. The bill defines a "public sector" job as a full-time job in:
· education (including early childhood education),
· public health,
· emergency management,
· government,
· public safety,
· law enforcement,
· social work in a public child or family service agency, or
· public interest legal services (including prosecution or
public defense).
The Senate version of the bill--the Higher Education Access Act-- has
cleared the Health, Education, Labor, and Pensions (HELP) Committee,
but has not been addressed by the full Senate. The Senate bill
contains enough critical differences that drafting an eventual
compromise bill between the two chambers could be complicated. Those
negotiations will probably take place this fall.
IMPORTANT NOTE: Currently, counselors cannot receive loan repayment as
a result of the House vote. The House-passed language must also be
approved by the Senate, signed into law by the president, outlined
under regulations developed by the U.S. Department of Education, and
funded by Congress before any money can be disbursed.
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Christopher C. Campbell, M.A. Ed.
Assistant Director of Public Policy and Legislation
American Counseling Association
5999 Stevenson Avenue, Suite 200
Alexandria, VA 22304
703.823.9800 x241
703.823-0252 fax
703-405-9671 mobile
www.counseling.org