Madam Chair, I stand here today to express my support for H.R. 3221, The Student Aid and Fiscal Responsibility Act. With an emphasis on improving access to financial support for higher education, increasing educational opportunities and…
Madam Chair, I stand here today to express my support for H.R. 3221, The Student Aid and Fiscal Responsibility Act. With an emphasis on improving access to financial support for higher education, increasing educational opportunities and preparing students for 21st century jobs by providing the resources they need to compete, H.R. 3221 ensures that we will be able to effectively rise up out of the ashes of what has been categorized as the longest and deepest economic downturn since the Great Depression. The national economic crisis has begun to infiltrate every corner of this country, and my home state of Texas is no exception.
In the midst of this very difficult economic climate, there has never been a more important and relevant time for the passage of H.R. 3221, the Student Aid and Fiscal Responsibility Act, which provides access to affordable quality education opportunities. In accordance with President Obama's statement that the best investment in our economic future is an investment in our children's education, this important legislation helps to make college and post secondary education more affordable, and subsequently takes the necessary steps to invest in our country's economic future, all at no new cost to taxpayers.
By making college more affordable, H.R. 3221 will enable more American students to not only matriculate on to higher education, but it will enable them to have the financial capability to graduate. This legislation provides all federal student loan borrowers with upgraded and modernized customer service, by providing them access to a public- private partnership that will serve as a resource for loan support. H.R. 3221 prepares students and graduates for 21st century jobs by providing Americans with the requisite skills and cutting edge resources they need to compete in today's job market.
Early Education
This vital legislation ensures that the next generation of students enters kindergarten with the skills they need to succeed in school, by reforming state standards and practices for birth-to-five early learning programs. This will have an immediate and direct impact on low income children entering kindergarten with the school readiness skills needed to succeed at this critical stage in learning development.
It is important to note that H.R. 3221 creates an Early Learning Challenge Fund, which would award competitive grants to states that implement overall standards-based reform, thereby incentivizing each state to transform their early education standards and practices, to build an effective early childhood workforce, and improve the school readiness outcomes of young children from every demographic and every socio-economic background.
Direct Loan Program
H.R. 3221 provides reliable, affordable high-quality Federal student loans for all families. By strengthening the Pell Grant System, and by converting all new federal student lending funds to the stable, effective and cost-efficient Direct Loan program, the proper lending infrastructure to ensure a solid lending program removed from the fluctuations of the economy will be in place. Beginning in July 2010, new federal student loans will be originated through the Direct Loan program, rather than through lenders who are subsidized by taxpayers in the federally-guaranteed student loan program. One of the major benefits of the Direct Loan program is that unlike lender-based programs, the Direct Loan program is insulated from market swings, will enable students to have access to low-cost federal college loans irrespective of the current state of the economy.
Fiscal Responsibility and Financial Literacy
My concern for the importance of instilling a sense of fiscal responsibility in our youth runs deep. Recent studies have indicated that young people do not even know basic financial topics such as the impact of student loans on one's credit, how to balance a checkbook, and the impact of automobile loans on one's credit. Because of my concern that young people are not sufficiently informed about financial literacy, this year I introduced H.R. 1325, to require financial literacy counseling for borrowers, and for other purposes. H.R. 1325 is relevant in the discussion of financial aid and fiscal responsibility, because approximately two-thirds of students borrow to pay for college according to the Center for Economic and Policy Research. Moreover, one in ten of student borrowers have loans more than $35,000. This legislation was designed to ensure that our nation's college students will be more prepared when incurring student loan debt and help them to avoid default as student loans severely impact one's credit score.
Currently there is about $60 billion in defaulted student loan debt. Many students do not understand the reality of repaying student debt while taking out these loans. While most Americans have debt of some kind, student loan repayment is especially scary, as one cannot just declare bankruptcy and have their loans discharged. Due to the lack of financial literacy counseling for borrowers, student loan payments are often higher than expected. Recent graduates are unable to afford the monthly payments resulting in them living paycheck to paycheck, acquiring credit card debt and in extreme cases, grads leaving the country in order to avoid repayment and debt collectors.
Students and parents are not currently receiving the proper or any information of the burden that their student loans will have once they graduate. This is possibly a result of the relationship between student loan companies and universities, as some lenders offer universities incentives to steer borrowers their way.
College campuses are one place that young Americans are introduced to credit and the possibility of living beyond their means. With proper loan and credit counseling the burden of debt incurred in college could be greatly reduced. Especially in this time of recession, financial literacy is one of the most important tools that we can give to our students in order to ensure their success in the future.
My resolution was crafted to provide financial literacy training to students taking out Federal Student Loans and will require a minimum of 4 hours of counseling including entrance and exit counseling. Counseling will include the fundamentals of basic checking and savings accounts, budgeting, types of credit and their appropriate uses, the different forms of student financial aid, repayment options, credit scores and ratings, as well as investing.
increasing funding for education
Madam Chair, I also would like to address the relevance of this measure to our nation's Historically Black Colleges and Universities (HBCUs), and minority serving institutions, and to thank Chairman Miller, other members of the Committee and the staff for taking bold and necessary steps to ensure the long-term and robust engagement of these institutions for many years to come. I have always been a proponent of increasing educational opportunities for students of every level, from every socioeconomic background throughout our nation will yield the greatest return on our investment. Providing access to educational opportunities is critical to the nation's long term prosperity. Most recently I advocated on behalf of the Departments of Labor, Health and Human Services, and Education and Related Agencies Appropriations Act of 2010, H.R. 329, which sought to make the necessary investments to provide children with a 21st century education, will provide the resources to modernize our schools and colleges, and will provide funding to make college more affordable.
Just as I supported past legislation like H.R. 3081, the American Recovery and Reinvestment Act of 2009, which placed a premium on providing funding for and lending institutional support to our Historical Black Colleges and Universities (HBCUs) and Predominantly Black Institutions (PBIs), the Student Aid and Fiscal Responsibility Act invests $2.55 billion in HBCUs and Minority-Serving Institutions to provide students with the support they need to stay in school and graduate.
HBCUs and PBIs as defined in the Higher Education Act of 1965, as amended (HEA) as the following: A historically Black college or university is an institution of higher education established prior to 1964, whose principal mission was, and is, the education of Black Americans, and that is accredited by a nationally recognized accrediting agency or association determined by the Secretary to be a reliable authority as to the quality of training offered or is, according to such an agency or association, making reasonable progress toward accreditation. Historically Black colleges or universities also include any branch campus of a southern institution of higher education that prior to September 30, 1986, received a grant as an institution with special needs under HEA Section 321 and was formally recognized by the National Center for Education Statistics as a Historically Black College or University.
Predominantly Black Institutions are defined in HEA Section 318. These institutions meet basic eligibility under Title III, Section 312(b) and serve at least 40 percent Black American students. Basic eligibility under Title III, Section 312(b) of the HEA is met by institutions that:
have low educational and general expenditures (E&G) or seek a waiver by submitting evidence that is both persuasive and compelling to have this requirement waived;
have a requisite enrollment of needy students;
are legally authorized within their respective state to award bachelors degrees or are a community college; and
are accredited by a nationally or state recognized accrediting agency.
An institution is considered to have met the enrollment of needy students criterion if (1) at least 50 percent of its degree-seeking students receive financial assistance under one or more of the following programs: Federal Pell Grant Program, Federal Supplemental Educational Opportunity Grant Program, Federal Work-Study Program and/ or the Federal Perkins Loan Program or (2) the percentage of its undergraduate degree-seeking students who were enrolled at least half- time and received a Federal Pell Grant met or exceeded the average for similar institutions.
We must invest in our nation's Historically Black Colleges and Universities (HBCUs) and other Minority Serving Institutions. A digital disparity between HBCU campuses and their counterparts currently exists. There is a significant need among HBCUs to update technological equipment and to develop advanced and cutting edge educational and technological opportunities for students. In the face of the adversity that outdated technology poses, HBCUs continue to generate thousands of African-American graduates who are prepared to compete in and contribute to our global economy. HBCUs represent nine of the top ten colleges that graduate the most African-Americans who go on to earn Ph.D.s. HBCUs and PBIs continue to provide opportunity and advancement to African-American students, and therefore are worthy of federal support.
Accordingly, my past legislative efforts have supported efforts to provide $653 million to strengthen the capacity of HBCUs and PBIs, Hispanic-serving Institutions, Tribal Colleges and Universities and Native American-serving Institutions, Asian Pacific Islander, and Native American Institutions. In the state of Texas, we have Tribal, Hispanic and African American populations that will benefit greatly from provisions that provide mandatory funding for the next 10 years. As the nation meets the demands associated with global competitiveness and changing demographics, resources provided in this measure very much are need to ensure our nation's long-term viability. The $85 million designated annually for HBCUs is particularly noteworthy, and will contribute greatly to helping these historic institutions in equipping students with the skills and exposure needed to drive globally relevant innovations and nationally relevant achievement.
Additionally, the measure provides unprecedented increases in student aid--particularly for the Pell Grant and Perkins Loan programs. Most notably, by ensuring that all new federal student loans will be processed through the Direct Student Loan program, the bill is expected to generate $87 billion in savings over the next ten years. These savings will be reinvested in other worthy projects benefiting community colleges and expanding the number of students who enroll and graduate from college.
As a Representative from the 18th Congressional District of Texas, I know firsthand that this will enable HBCUs like Texas Southern University in my district and Prairie View A&M University just outside of my district to thrive.
My past support of bills such as H.R. 3293 have advocated on behalf of an investment of $15.9 billion for Title I Education for the Disadvantaged Children Account, which will provide much needed support to underprivileged children in Grades K through 12, and will give hope to the low income families in my district in Houston, that their children will receive quality education. There is no greater investment in our country than an investment in our children's opportunity to obtain a quality education. I urge my colleagues today to pass this critical piece of legislation, as our nation's long-term prosperity hangs in the balance. Madam Chair, I support this legislation. I urge my colleagues to do the same.
I thank the distinguished chairman and I thank him for his stellar leadership and an overwhelming change in the way we think about education.
I rise to oppose the present amendment, but support the underlying bill. This is a response to the competitiveness of the world. Each and every district that is represented here in this body, rural and urban, large and small, clamors for more education, particularly secondary education, higher education.
In my own district alone, as it relates to Pell Grants, 23,084 students will be impacted, with as much as $110 million in new Pell dollars that will help not only the Nation's colleges but, in my instance, the 18th Congressional District.
I happen to have a district that has any number of colleges, both private and public, large and small, research and nonresearch, students coming from all economic backgrounds, and I can assure you the importance of Pell Grants is without comparison.
Then I also represent an area that was hit by Hurricane Ike 1 year to the date last week, still suffering from the lack of infrastructure, schools that have been destroyed. And the $359 million that will come in construction dollars to Texas, K-12, is going to be a remarkable change for the people of Galveston or the people on the gulf who are impacted by this devastating hurricane.
In addition, I think it's important to note a full $87 billion in savings. Competition in place. Anyone who wants to provide a student loan--private bank, State bank--can provide it. But we are providing for the hardworking, taxpaying families additional dollars and a fair, even playing field. That's something to celebrate.
We're investing $3 billion to bolster college access and completion support. Crucial issues. I happen to have a very large community college system. I'm gratified that language is in here specifically to enhance community college.
Our community college system is growing with 60,000 students-plus. This is the first step. Go to a community college, be you someone who is working, someone who is raising children, someone who is going back to school, a military person who is retired or has just gotten out of the service, working with the GI Bill--you now have an opportunity to be able to go to a college that has reinforced dollars.
This is a bill that cuts at America's competitiveness. The world is getting smaller. People know science and math. They are looking to be inventive. And that means in order to create an economic engine for this country, we have got to educate our population.
People are clamoring for education. As I indicated, all walks of life, retirees, people who are changing jobs, people who have been laid off and fired. This is a new step.
So let me just say I want to applaud what we are doing here today, not because Members are doing it, but because we're changing lives. I ask my colleagues to support this legislation.