U.S. Sens. Mark R. Warner and Tim Kaine (both D-VA) welcomed legislation that passed the Senate this afternoon to renew the Federal Perkins Loan Program, a critical lifeline for 7,800 low-income college students in Virginia. Though the program had the support of a bipartisan majority of Senators, including Sens. Warner and Kaine, the Federal Perkins Loan Program lapsed on September 30, 2015, cutting off the ability for approximately 1,500 colleges and universities across the country to make low-interest loans to new borrowers and leaving 150,000 students who have just started college in the lurch.
“The Perkins program is essential to the college dreams of many first-generation and low-income students. While Congress works on reforming and streamlining our student aid system to make college more accessible and affordable, Perkins recipients in Virginia deserve some certainty and predictability for their financial planning,” said Sen. Warner, who used student loans to become the first in his family to graduate college. “I’m pleased that the Senate has finally moved to restore some of that predictability, and I hope that the House of Representatives will quickly follow suit.”
“I’m pleased the Senate could come to an agreement on the reauthorization of the Federal Perkins Loan Program, which is critical to helping low-income students and their families find financial assistance to help afford a college education,” Sen. Kaine said. “The Federal Perkins Loan Program Extension Act of 2015 will extend the program for an additional two years for undergraduates and gives current graduate students one more year of eligibility. This bill isn’t perfect, but it will help keep student loan debt low and manageable for many families in Virginia and provides them with certainty and predictability while Congress works to reauthorize the Higher Education Act.”
The Perkins Loan Program is the nation’s oldest federal student loan program, has existed with broad bipartisan support since 1958 and has provided more than $28 billion in loans through almost 26 million awards to students in all 50 states. Perkins loans offer a five percent fixed interest rate, no origination fees, and a nine-month grace period. These reasonable, relatively low-dollar loans make college a reality for the lowest-income students, often the first in their family to attend college, who would otherwise turn to higher interest private loans or conclude that a college education is out of their reach.
In the 2013-2014 academic year, the most recent year for which data is available, approximately 539,000 students received loans from their institutions through the Federal Perkins Loan Program, totaling more than $1.2 billion. Because the program’s authorization has now lapsed, many students who start college may face limited options to afford rising costs; they may resort to taking out private loans, which come at a higher interest rate, have strict qualifications, and greater repayment burden—or students may delay their enrollment or drop out. The U.S. Department of Education’s budget service indicates this number is between 100,000 and 150,000 new students in the current academic year alone if Congress fails to act, and this number would only increase if the program is not extended.
The Federal Perkins Loan Program Extension Act of 2015 is a bipartisan compromise that extends the Perkins Loan program for two years (through September 30, 2017) for eligible current and newundergraduates, and for one year for current graduate students (through September 30, 2016). It also requires that institutions notify students who are offered a Perkins Loan that the program is coming to a close, an explanation of their repayment and forgiveness benefits, and lays out other options that may be available to them as part of federal student loan programs.
The legislation now needs to go to the House of Representatives, which previously approved a one-year, no-cost extension of the Perkins program.
In the 2013-2014 academic year alone, the program helped more than 7,800 low-income students at more than three dozen Virginia colleges and universities fund their educations:
|University of Virginia||1,255|
|Virginia Polytechnic Institute & State University||768|
|Virginia Commonwealth University||594|
|James Madison University||418|
|Eastern Mennonite University||361|
|College of William & Mary||232|
|Norfolk State University||230|
|George Mason University||211|
|University of Richmond||210|
|Mary Baldwin College||177|
|Randolph – Macon College||141|
|Northern Virginia Community College||133|
|Washington and Lee University||129|
|Virginia Wesleyan College||112|
|American National University||110|
|Virginia Military Institute||103|
|Virginia State University||103|
|Hampden Sydney College||94|
|Old Dominion University||93|
|Eastern Virginia Medical School||91|
|Sweet Briar College||73|
|Emory & Henry College||66|
|University of Mary Washington||20|
|Advanced Technology Institute||2|
Source: Office of Federal Student Aid
Previously, Sens. Warner and Kaine joined 52 colleagues—a bipartisan majority of the Senate—in sending a letter to Senate leaders urging them to reauthorize the Perkins Loan Program. Earlier, Sens. Warner and Kaine were also joined by U.S. Reps. Bobby Scott (D-VA-3), Gerry Connolly (D-VA-11), and Don Beyer (D-VA-8) in a Sept. 28 letter urging the Senate Committee on Health, Education, Labor and Pensions (HELP) to approve a one-year Perkins reauthorization.
Congress is currently working to reauthorize the Higher Education Act (HEA), which expired at the end of 2013. The HEA includes the entire federal student loan system, the Pell grant tuition assistance program for low- and middle-income students, and various programs that help low-income students access higher education.
Sen. Warner has introduced several bipartisan, commonsense solutions to make college more affordable and to help those who are already struggling with student debt. The Student Right to Know Before You Go Act will provide college-bound students powerful new tools for comparing colleges and universities on measures such as total cost, likelihood of graduating, and potential earnings. The Go To High School, Go To College Act will increase college access for low-income students by allowing them to earn college credits in high school through the Pell Grant program. The Employer Participation in Refinancing Act will allow employers to help qualified employees repay student loans with pre-tax dollars. He has also sponsored several bills to make it easier for students to enroll in federal income-based repayment programs that protect graduates during periods of unemployment or low earnings.
Sen. Kaine has advocated for expanded access to federal student aid to help increase postsecondary education affordability. In September, he introduced the Career & Technical Education (CTE) Opportunity Act, which would expand eligibility for federal student loans to short-term CTE programs which do not meet the current program length requirements under Title IV of the Higher Education Act. In July, Sen. Kaine introduced theJumpstart Our Businesses By Supporting Students (JOBS) Act, legislation that would amend the Higher Education Act by expanding Pell Grant eligibility to students enrolled in short-term job training programs.
Sen. Kaine is a co-sponsor of the Fairness for Struggling Students Act, which would allow students who borrow money from private lenders for their education to discharge their debt during bankruptcy proceedings. Sen. Kaine, who benefited from dual enrollment as a student, also co-sponsored the Supporting College Access and Success Through Dual Enrollment Act, in the last Congress, to help students earn college credits in high school in order to cut the cost of earning a college diploma.