Although the Senate’s Education Committee has approved its No Child Left Behind reform legislation, Chairman John Kline (R-MN-02) is still dallying with his piecemeal approach … so rather than hold hearings on reforming Education, Mr. Kline’s Subcommittee on Higher Education and Workforce Training held an oversight hearing on Tuesday to examine the Department of Education’s implementation of the Direct Loan Program.
Mr. Kline’s Roadblocker, Virginia Foxx (R-NC-05) set the tone ““We have a responsibility to conduct proper oversight to ensure the Direct Loan program is meeting the needs of higher education institutions, students, and taxpayers” … while Chairman Kline expressed concerns about the department’s ability to maintain a high standard of customer service.
“While some in our industry predicted that the 100% transition to Direct Lending was an impossible task, the partnership of financial aid administrators and the Department of Education resulted in a very successful outcome,” said Nancy Hoover, the immediate Past Chair of the National Direct Student Loan Coalition (NDSLDC) and the Director of Financial Aid at Denison University in Granville, Ohio. “To date, I do not recall that there was a single instance in which students did not receive their Stafford Loan funds during and after the transition. This transition of all schools to the Federal Direct Student Loan program could not have been more successful for students, schools, or taxpayers.”
“I am happy to report we experienced no disruption in loan availability to our students either during or after the transition,” said Mark Bandré, the Vice President for Enrollment Management and Student Affairs at Baker University, a private institution serving 3,700 students in Baldwin City, Kansas. “The Direct Loan program is working.”
“Although an avid supporter of FFELP [the previous program – Federal Family Education Loan Program], when the financial markets froze in 2008, when many local and area banks discontinued participation in 2009 and 2010, when remaining private lenders showed an uncertainty in their longevity of participating in FFELP, the decision became clear. Ultimately, I determined the Direct Loan Program was the best option for our students and our institution and advised my administration on January 28, 2010, that we would be making the move from FFELP to DL by the following summer,” said Ron Day, Director of Financial Aid at Kennesaw State University in Kennesaw Georgia, a 4-year public university located in near Atlanta. “When it was all said and done, I am proud to say that I am not aware of any student who was denied access to student loans due to a school not successfully transitioning into the Direct Loan program.”
In fact, every witness at the hearing regarding the Direct Loan Program (DL) agreed that the transition to the more reliable DL program was seamless and successful. When asked, none of these professionals said they wanted to go back to the past under Federal Family Education Loan Program (FFELP). Presently, about 6,000 schools are using the DL program successfully.
Interesting that with all these positive statements being made, that Mr. Kline’s Republican Party press release did not mention this. Instead, the press release focused on the Obama Administration’s taking action of student loan repayment plans.
As President Obama expressed concerns in the State of the Union address “ in the United States of America, no one should go broke because they chose to go to college.”
President Obama is responding to a petition representing 32,008 signatures concerned with the burden of existing student loan debt.
To respond to this petition, the Income Based Repayment (IBR) policy is being modified to 10% of the student’s discretionary income from the existing 15% requirement. The IBR policy allows students to repay student loans based on the income they make, rather than the standard 10-year repayment plan … as such, this allows students to reduce their loan payments by hundreds of dollars a month in many cases, while keeping the loans in good standing.
It makes you wonder how Mr. Kline would respond to such a petition …. after all Mr. Kline decried the “government takeover of student loans” and has written a letter to the Joint Select Committee on Deficit Reduction advocating cutting Pell Grants … and we soon may find out as signatures are being collected by the MN State University Student Association (www.msusa.org/savepell or on facebook at www.facebook.com/msusa1967) who which to see the Pell Grant program saved … not destroyed.
John Kline … exemplifying the GOP strategy … Shortchanging Our Future.