Washington, D.C. – U.S. Senator Sheldon Whitehouse (D-R.I.) voted today to pass legislation raising Pell Grant awards, the federal student aid program that makes it easier for students from low-income families to afford a college education. The College Cost Reduction and Access Act (H.R.2669) also reduces interest rates for student borrowers and provides incentives for students to pursue employment in the public sector.
“No student who wants to learn should be prevented from attending college because of financial worries. This bill will allow more young Rhode Islanders the opportunity to make their dreams of higher education a reality,” said Whitehouse. “I’m proud to be part of this effort to increase funding for Pell Grants, championed by Rhode Island’s own Senator Claiborne Pell.”
The cost of attending college has skyrocketed in recent years, with tuition and other fees rising at rates higher than inflation. A four-year public university in Rhode Island costs $3,211 more than it did five years ago, on average; the average cost of attending a private institution has risen by $7,044 in the same period.
Compounding this problem, federal student aid has not kept pace with the rapid rise in college fees. Twenty years ago, the maximum Pell Grant award covered 39 percent of college costs in Rhode Island. Today, these grants only cover 28 percent of costs.
Under the legislation passed today, for the 2008-2009 academic year, the average Pell Grant in Rhode Island will increase by $360, to $2,880 per year, and Rhode Island students will receive an additional $7.8 million in need-based grant funding. Over the next five years, as the maximum Pell Grant reaches $5,400 per student, Rhode Island will receive an additional $84.8 million in grant funding, as well as another $42.6 million in aid from federal loans. The bill also increases income levels at which students are automatically eligible for maximum grant funding, expanding access for low-income students.
The College Cost Reduction and Access Act also includes a sharp reduction in interest rates for subsidized student loans, and caps monthly student loan payments. Today, 61 percent of Rhode Island students graduate with debt, with an average burden of $20,798. The bill bars student loan repayment from rising higher than 15 percent of discretionary income, so students with significant debt are better able to repay their loans.
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