Wellstone Action!

posted by Mattie Weiss

APRIL 07, 2010

We here at Campus Camp Wellstone are so excited about a piece of legislation that passed along with Health Care Reform, and we had to make sure you knew what was in the Student Aid and Fiscal Responsibility Act (SAFRA).

This is legislation that takes on some of the biggest challenges to young people being able to access and afford higher education.

The key components of the Student Aid and Fiscal Responsibility Act are as follows:

• Increase the Pell Grant - The Pell grant was initially designed to cover 80% of college costs; however it has been chopped overtime, so now it only covers about 1/3 of the average cost. The maximum Pell Grant offered for the current school year was $5350. SAFRA increases the maximum to $5550 in 2010 and continues to increase with inflation.
  
  

• Invest $3 billion in college access- The college completion gap between high-income and low-income students is staggering. Under a third of low-income students with the highest test scores go on to complete a 4 year degree, compared to 74% of their high-income counterparts. This provision will help close the retention and completion rates of low-income students.
  
  

• Make Federal loan repayment more affordable by putting a cap on the maximum monthly payment according to income - This provision starts in 2014 and will allow new borrowers to cap their student loan repayments at 10% - it's 15% for current borrowers - of their discretionary income [discretionary income is money left over after the essentials like rent/mortgage, food, etc. is taken care of].
  
  

• Convert all new Federal loans into Direct Loans - There are currently many student loan programs in which the federal government lends through private or 3rd party lenders, and those lenders receive subsidies for that service. Meaning private corporations get public money to loan us government dollars, crazy, no? Well all of this is out the door! Direct Loans are loans that are given and managed directly by the federal government through the Department of Education. Moving loans to this program will ease the stress of repayment for students & reduce the country's deficit by $10 billion over 10 years!
  
  

• Invest in minority serving institutions, such as, Historically Black Colleges & Universities, Tribal Colleges, and Hispanic serving institutions - This provision invests $2.55 billion in these institutions to encourage students to enter careers in S.T.E.M. majors (Science, Technology, Engineering, and Mathematics).
  
  

• Invest in competitive grant programs specifically for community colleges -This $10 million funding will give community college the resources needed to complete the cycle of education, preparing and moving students into the workforce.

Go Congress! Thank you to those that voted in favor of Health Care Reform and SAFRA; way to move a beautiful piece of legislation.  To learn more about SAFRA you can visit our partners at the United States Student Association, who ran a campaign to pass the bill.