Mr. Speaker, I thank the chairman for yielding me time, and I thank the gentleman from Massachusetts (Mr. Tierney) for cosponsoring this legislation, working in a bipartisan way to recognize a very powerful tool that many do not know even…
Mr. Speaker, I thank the chairman for yielding me time, and I thank the gentleman from Massachusetts (Mr. Tierney) for cosponsoring this legislation, working in a bipartisan way to recognize a very powerful tool that many do not know even exists.
Mr. Speaker, one of the reasons for this resolution is to remind many Americans that there is a possibility that you can save and compound and fight the rising costs of getting your children a quality education.
I remember in Michigan we started something like this where it is tax-free in and tax-free out in a 529. You do not pay Michigan income tax if you get into one of these education funds. At the announcement, a woman brought a jar full of pennies. She was so excited, she said, ``You know, no longer do I have to fill this jar with pennies. I can put it somewhere where these pennies will become dollars and hundreds of dollars for my child to have and get a chance at a quality education in America.'' How true that was, and how inspiring it was for that woman to recognize that this is such a powerful instrument for parents all across this great country, to have the benefits of a tax-free way to save and compound for offsetting these rising costs of getting that education.
Mr. Speaker, 86,000 people since the introduction of this bill, in Michigan alone, have signed up and are putting $25, $15, $10 or $100, as much as $5,000, away in these funds and watching it grow, tax-free, certainly at the State level, and tax-free at the Federal level, thanks to all the Members of this Chamber, when you withdraw it for your child's education. You can start to fight back the cost of books and computers and room and board, and, certainly, that cost of tuition through these funds.
I want to, again, thank my colleagues on the other side of the aisle for working in such a great, bipartisan spirit to reach a very laudable goal, and that is quality, accessible, higher education and vocational training for every American. This certainly empowers hundreds of thousands of them to do that right here at home.
Mr. Speaker, as the sponsor of H. Con. Res. 270, I rise in support and wish to thank Chairman Davis for bringing it to the floor today and to thank Congressman John Tierney for joining me in sponsoring this resolution. H. Con. Res. 270 recognizes September as College Savings Month in conjunction with the National Association of State Treasurers and the College Savings Plan Network in order to raise public awareness about the need to save for educational expenses.
Since 1980, the rate of increase of the cost of postsecondary education has exceeded the rate of increase of inflation, public assistance to students and family income. This rapid rate of increase poses serious threats to the ability of parents to save for and individuals to access postsecondary education.
Given that it is in our Nation's best interest to have a highly educated population and to encourage parents to save for their educational expenses, many States, like Michigan, offer tax incentives to encourage their citizens to save for educational expenses. As a State senator, I sponsored legislation to develop a 529 plan that provides tax-free contributions and withdrawals made to an education savings account. Soon after becoming a Congressman, I introduced legislation to make distributions from State-sponsored prepaid tuition or college savings plans tax free. I was pleased when this provision was included in the 2001 Economic Stimulus legislation that was signed by the President. Education savings accounts are one way that we can ensure that individuals at every income level have the ability to contribute to their child's or a relative's or even their own postsecondary education.
I realize many working families are trying to save for college and it would be ideal if no student had to take out a student loan. But for those who do incur debt, we need to make sure every student loan borrower has a real opportunity to borrow at the lowest rate possible. In order for borrowers to reach the lowest rates possible, there must be competition in all aspects of the student loan program, including consolidation loans.
In order to ensure that we instill such competition, we will need to make sure that we repeal the single holder rule during the reauthorization of the Higher Education Act, which is currently moving through the Education and the Workforce Committee. I want to thank my colleagues, Chairman Boehner and Congressman McKeon, for their efforts to keep college costs under control. It will be part of my commitment to them as well as students and families everywhere that they can have the benefit of competition from the more than one thousand qualified lenders in the program when they consolidate their loans and, thus, allow them to further reduce their debt burden by taking advantage of historically low fixed interest rates, just as other borrowers are able to do every day.
In conclusion, I encourage my colleagues to support H. Con. Res. 270 and the goals and ideals of College Savings Month.