Wednesday was a difficult day for The American Independent News Network, which is the larger entity that operates The Iowa Independent. Our chief executive and founder announced two of our sister sites would close and their content would be moved to The American Independent.
A recently introduced bill could have far-reaching impact on the U.S. sugar industry, including American Crystal Sugar, a farmer-owned cooperative that locked out 1,300 Midwest workers on Aug. 1.
The chairman for Herman Cain’s Iowa effort says the campaign “relied more on the word of farmers than Washington regulators” in deciding to run an ad containing claims the Environmental Protection Agency says are false.
The Iowa Senate will remain under the control of a slim 26-25 Democratic majority when it reconvenes in January 2012.
The House passed a bill last week that would mark the single largest investment in college financial aid since the 1944 GI Bill, helping millions of students and families pay for college without adding new costs to taxpayers.
The legislation, the College Cost Reduction Act of 2007 (H.R. 2669), would boost college financial aid by about $18 billion over the next five years. Under the congressional pay-as-you-go rule, the legislation pays for itself by reducing excessive federal subsidies paid to lenders in the college loan industry by $19 billion. It also includes nearly $1 billion in federal budget deficit reduction.
Richard Brown (middle) and Michael Charles (right) listen to Rep. Loebsack (left) explain some of the benefits of the College Cost Reduction Act
Loebsack met with University of Iowa Students Saturday to discuss how they’ll benefit from the legislation and listened to students as they shared input. Most of those in attendance were pursuing post-graduate degrees in either education or nursing. One component of the bill that attracted a few of the students was loan forgiveness for college graduates that go into public service professions.
“Coming out of school, my husband and I prefer not to be $40,000 in debt. And we really want to stay in Iowa,” said Nikki Petsas Blodgett, a PhD. nursing student (left). Petsas Blodgett and her husband are doctoral students at the UI College of Nursing and have depended on the Nurse Faculty Loan Program to help complete the program together. “It’s so vital for both of us to go to school at the same time. Otherwise, one of us would have to work full-time. I come from a long line of nurses, who depended on financial assistance to complete their degrees. It would be an easy draw to go to another state where the pay is higher when we graduate, but we’d rather stay in Iowa.”
As a result of this legislation, Iowa’s students and families will receive $232 million over five years in additional benefits in the form of student loans and Pell Grants. In addition to increasing the maximum value of the Pell Grant Scholarship to $5,200 from $4,050 over the next four years, this legislation authorizes a year-round Pell program.
The legislation would also cut interest rates in half on need-based student loans, reducing the cost of those loans for millions of student borrowers. Like legislation passed by the House earlier this year, the College Cost Reduction Act would cut interest rates from 6.8 percent to 3.4 percent in equal steps over the next five years. Once fully phased-in, this would save the typical student borrower – with $13,800 in need-based student loan debt – $4,400 over the life of the loan. About 6.8 million students take out need-based loans each year.
The legislation would also prevent student borrowers from facing unmanageable levels of federal student debt by guaranteeing that borrowers will never have to spend more than 15 percent of their yearly discretionary income on loan repayments and by allowing borrowers in economic hardship to have their loans forgiven after 20 years.
The bill has already moved on to the Senate and has been placed on the calendarr for debate as early as next week. The Senate version, the Higher Education Access Act (S. 1762) was introduced by Sen. Ted Kennedy, D-Mass., last Tuesday. Sen. Tom Harkin, D-Iowa, along with his colleagues on the Senate Health, Education, Labor, and Pensions (HELP) Committee, approved legislation today that generates more than $17 billion in additional student aid and brings transparency to the rising cost of college and inappropriate practices in the student loan community.
“The rising cost of a college education threatens the dream of a higher education for middle-income and disadvantaged students,” said Harkin in a press release. “In the last five years, the cost of attendance at a four-year public college in Iowa has grown more than 50 percent. At the same time, the buying power of the Pell grant has dropped.”
The Higher Education Access Act increases the maximum Pell grant to $5,100 in the 2008-2009 school-year and $5,400 in 2011. The Higher Education Act Amendments, also approved by the HELP Committee, create an unbiased federal database to track the increases in college tuition for current and prospective college students.
“This is a win-win for students and families, by providing students with information about the cost of their college education, and increasing the federal investment student aid so many students depend upon,” Harkin said.
“This bill will provide more than $36 million in additional student aid for Iowans the first year it takes effect in 2008. It also establishes fair loan repayment plans for young people who just graduated from college and are struggling to make ends meet.”
Also included is a student loan repayment plan that would be tied to a borrower’s discretionary income. The bill provides increases in need-based aid at no further cost to taxpayers by trimming excess subsidies for lenders.
The committee also took action to address the growing abuse of federal loan programs by for-profit lenders by enacting initiatives included in the Student Loan Sunshine Act, a bill Harkin co-sponsored.
“The federal government commits more than $50 billion in funding to student loans each year. We owe it to the students dependent on those loans and to the taxpayers who fund them to make sure those funds are spent wisely and not abused in schemes designed to deceive students,” Harkin said.
When asked by UI students why anyone would oppose the bill in the Senate, Loebsack replied. “I couldn’t really tell you for sure. There is a great deal of pressure on Congress coming from the loan industry and there are concerns of making government bigger. This is an investment in education and the future. We’re investing in human infrastructure and human capital. This bill is a no-brainer to me and is absolutely necessary if we’re going to compete in the global economy.”
Update: Sen. Chuck Grassley provided the following statement to the Iowa Independent regarding both pieces of legislation:”While the Senate is expected to debate its own legislation, I had hoped the House would have focused more on increasing financial aid for students than further subsidizing interest rates for college graduates. Lowering interest rates does nothing to increase the amount of aid a student gets to pay their tuition in the first place.”
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