A new senate bill proposal, the College for All Act, would offer tuition-free college and lower student loan rates.
Sen. Bernie Sanders, I-Vt., and Rep. Pramila Jayapal, D-Wash., introduced the proposal – which would amend the Higher Education Act – on Monday. It’s modeled after 2016 presidential campaign promises made by both Sanders and Clinton.
“Higher education in America should be a right for all, not a privilege for the few,” Sanders said in a statement on the proposed bill. “If we are to succeed in a highly competitive global economy and have the best-educated workforce in the world, public colleges and universities must become tuition-free for working families and we must substantially reduce student debt.”
Several other congress members, including Sen. Elizabeth Warren, D-Mass., demonstrated support for the College for All Act.
Main goals of the College for All Act
Offer tuition-free college
“Our young people are forced to make untenable choices: going to college and taking on mountains of debt, or foregoing their college degree to work part-time or minimum wage jobs that simply won’t allow them to build a future,” Rep. Jayapal said.
The College for All Act aims to eliminate those difficult choices and make college accessible to all Americans. It promises free tuition at four-year public colleges and universities for all students from families earning up to $125,000 — about 80 percent of U.S. households. Community colleges would be tuition- and fee-free for all, regardless of income.
Currently, 44 million borrowers are saddled with student loan debt. The average Class of 2016 graduate who took out loans to pay for school graduated with $37,172 in student loans. Many of those likely come from the middle-class families the College for All Act aims to help.
The College for All Act would also significantly lower or eliminate the cost of attendance for the lowest-income students. It would:
- Cover the cost of tuition and fees first, before applying any other financial aid. This would allow low-income students to use Pell grants and scholarships to cover books, housing, transportation, and other costs.
- Require states to cover the full cost of college, including room and board.
- Invest more heavily in work-study programs to help students work through college.
- Establish a grant program to eliminate or reduce tuitions and fees at historically black colleges and other universities serving minorities.
- Increase funding for TRIO and GEAR UP programs that help first-generation and low-income students enroll in and complete college.
Cap student loan rates
The College for All Act would make student loans more affordable for both new and existing borrowers by lowering student loan rates.
New borrowers would face student loan rates of just 1.88% compared to the current 3.76%. Undergraduate federal student loans would have a cap of 5%.
Existing borrowers would be able to refinance to the current lowest interest rate on student loans. Currently, student loan borrowers have to refinance student loans privately to lower their interest rates.
The act would also restructure federal student loan financing to prevent the government from profiting off of student loans. “Over the next decade, the federal government is projected to make over $70 billion in profit off of the student loan program,” according to a College for All fact sheet.
College for All Act to cost $600 billion
The legislators behind the bill proposal estimate that it would cost $600 billion over the next 10 years. That funding would come from a separate bill, called the Inclusive Prosperity Tax. The tax would levy fees on Wall Street transactions:
- 0.5 percent on stock trades
- 0.1 percent on bonds
- 0.005 percent on derivatives
It’s estimated these taxes will raise at least the $600 billion cost over the next decade, if not more.
The act lacks bipartisan support
The College for All Act could provide important relief to student loan borrowers and college students.
However, despite backing from five U.S. senators and 14 House Representatives, no Republican legislators have expressed support for the proposed bill. And in a Republican-majority House and Senate, the College for All Act is unlikely to pass.
Another promising bill, the Employer Participation in Student Loan Assistance Act, does have bipartisan support and aims at incentivizing employers to provide student loan assistance to workers.
Additionally, many states have put forward their own laws aimed to help make college more affordable.
In fact, Gov. Andrew Cuomo, D-N.Y., recently announced a plan that would make college tuition-free for New York families earning $125,000 or less. And California state legislators just proposed the Degrees Not Debt Act, aimed at getting students through college without student loans.
How you can support the College for All Act
Sanders stated that vocal support from young voters is key to moving such student loan and college affordability legislation forward.
If you support the College for All Act, use this website to find your representative’s contact information. Let them know you’re in favor of the College for All Act and help increase its chances of becoming a law.
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