With the doubling of interest rates on Subsidized Stafford Loans set to occur on July 1, multiple bills have been introduced in the House and Senate to address the situation. Between the White House, the House, and the Senate, there are multiple proposals from both parties to tie the interest rate on Stafford and PLUS loans to a market-based index. In addition, multiple Democrats in the House and Senate have called for an extension of the current Subsidized Stafford rate of 3.4 percent, arguing Congress should take up major changes to the student loan programs via the reauthorization of the Higher Education Act.
Today, the House Education and the Workforce Committee is set to mark up its legislation to move to market-based interest rates, H.R. 1911. We will be reporting on those deliberations, but in advance of the markup, we thought many COHEAO members would like a listing of current student loan legislation along with a matrix describing the different proposals to tie the interest rate on Stafford and PLUS loans to an index.
On the next page of this document, we have included a listing of student loan bills pending in Congress. Below that, we have included a matrix of the various “market-based” proposals.
We are hopeful you find this be a useful resource. As always, we welcome your feedback, particularly if we can format this document in a way to make it more useful. We will continue to track this legislation, providing periodic updates via Sparks and/or the COHEAO website.
Federal Loan Interest Rate
Switch to Fixed, Variable Rate Solutions
- S. 682, “Comprehensive Student Loan Protection Act,” Sen. Tom Coburn (R-OK) (Sens. Alexander, Burr, Isakson cosponsors). THOMAS bill summary and status: http://THOMAS.loc.gov/cgi-bin/bdquery/z?d113:SN00682:|/bss/|
Switch to Variable Rates with a Cap
- H.R. 1911, Rep. John Kline (R-MN) and Rep. Virginia Foxx (R-NC). Press release: http://edworkforce.house.gov/news/documentsingle.aspx?DocumentID=333239
- H.R. 1946, “Responsible Student Loan Solutions Act,” Rep. John Tierney (R-MA) (Uses 91-day T-Bills. Rep. George Miller is a cosponsor). Tierney press release: http://tierney.house.gov/index.php?option=com_content&task=view&id=3602&Itemid=500141
- S. 909, “Responsible Student Loan Solutions Act,” Sen. Jack Reed (D-RI) (Uses 91-day T-Bills. Sen. Durbin is a cosponsor). Fact sheet: http://tierney.house.gov/images/stories/Responsible_Student_Loan_Solutions_Act_of_2013.pdf
Simple Stafford extensions of 3.4%
- H.R. 1433, Rep. Joe Courtney (D-CT), 2 yr extension. THOMAS bill summary and status: http://THOMAS.loc.gov/cgi-bin/bdquery/z?d113:HR01498:|/bss/|
- H.R. 1498, Rep. Hakeem Jeffries (D-NY) (1 yr. extension). THOMAS bill summary and status: http://THOMAS.loc.gov/cgi-bin/bdquery/z?d113:HR01498:|/bss/|
- H.R. 1595, “Student Loan Relief Act,” Rep. Joe Courtney (D-CT), 2 yr extension. THOMAS bill summary and status: http://THOMAS.loc.gov/cgi-bin/bdquery/D?d113:5:./temp/~bdwZaW::|/bss/|
- H.R. 1876, “Stability to Ensure the American Dream for Youth (STEADY) Act”, Rep. Krysten Sinema (D-AZ), 4-yr extension. THOMAS bill summary and status: http://thomas.loc.gov/cgi-bin/bdquery/D?d113:2:./temp/~bdIh7t::|/bss/|
- S. 707, “Student Loan Affordability Act,” Sen. Jack Reed (D-RI), 2 yr extension.
http://THOMAS.loc.gov/cgi-bin/bdquery/z?d113:SN00707:|/bss/|
- S. 953, No Short Title, Sen. Jack Reed (D-RI), 2-yr extension paid for with tax code modifications (11 Democratic cosponsors, including Chairman Harkin)
Switch to Federal Discount Window Rate (1-Year)
- S. 892, Sen. Elizabeth Warren (D-MA). No short title, but sets Stafford and PLUS loans to Federal Reserve Discount Window rate for 1 year. THOMAS bill summary and status: http://THOMAS.loc.gov/cgi-bin/bdquery/D?d113:1:./temp/~bdZ9R1::|/bss/|
Bankruptcy
- H.R. 532, “Private Student Loan Bankruptcy Fairness Act of 2013,” Rep. Steve Cohen (D-TN). Restores bankruptcy for private student loans, but not federal loans. THOMAS bill summary and status: http://THOMAS.loc.gov/cgi-bin/bdquery/D?d113:3:./temp/~bdPHy3::|/bss/|
- S. 114, “Fairness for Struggling Students Act of 2013,” Sen. Dick Durbin (D-IL). Restores bankruptcy for private student loans, but not federal loans. THOMAS bill summary and status: http://thomas.loc.gov/cgi-bin/bdquery/D?d113:2:./temp/~bdQt11::|/bss/|
Disclosures
School Certification and Enhanced Disclosures
- S. 113, “Know Before You Owe Private Student Loan Act of 2013,” Sen. Dick Durbin (D-IL). Requires school certification THOMAS bill summary and status: http://thomas.loc.gov/cgi-bin/bdquery/D?d113:1:./temp/~bdQt11::|/bss/|
Federal Loan Entrance and Exit Counseling
- S. 546, “Smarter Borrowing Act,” Sen. Tom Harkin (D-IA). Increases disclosure and entrance/exit counseling requirements. THOMAS bill summary and status: http://thomas.loc.gov/cgi-bin/bdquery/D?d113:9:./temp/~bdMHWv::|/bss/|
Refinance-Loan Forgiveness
- H.R. 1330, “Student Loan Fairness Act.” Rep. Karen Bass. Calls for loan forgiveness after 10 years (5 years for public service). Allows for refinance of private student loans into federal loans. THOMAS bill summary and status: http://THOMAS.loc.gov/cgi-bin/bdquery/D?d113:1:./temp/~bdgEK8::|/bss/|
Repayment-IBR/Automatic Withholding
- H.R. 1716, “Earnings Contingent Education Loans Act of 2013,” Rep. Thomas Petri (R-WI) (Rep. Jared Polis (D-CO) also now a cosponsor). THOMAS Bill summary and status: http://thomas.loc.gov/cgi-bin/bdquery/D?d113:7:./temp/~bdd7Rx::|/bss/|
Student Loans & Taxes
Employer Provided Benefits
- H.R. 395, “Student Loan Employment Benefits Act of 2013,” Rep. Steve Israel (R-NY). To amend the Internal Revenue Code of 1986 to exclude from gross income amounts paid by an employer on an employee's student loans. THOMAS bill summary and status: http://thomas.loc.gov/cgi-bin/query/z?c113:H.R.395:
Student Loan Interest Deduction
- H.R. 1527, “Student Loan Interest Deduction Act of 2013,” Rep. Charles Rangel (D-NY). Increases deduction for student loan interest for tax purposes. THOMAS bill summary and status: http://thomas.loc.gov/cgi-bin/bdquery/D?d113:8:./temp/~bd163S::|/bss/|
Student Loans & Default Prevention/Default Rate Manipulation
- H.R. 618, “Student Loan Default Prevention Act,” Rep. Michael Michaud (D-ME). THOMAS bill summary and status: http://thomas.loc.gov/cgi-bin/bdquery/D?d113:6:./temp/~bdw9U6::|/home/LegislativeData.php|
- S. 406, “Students First Act of 2013,” Sen. Frank Lautenberg (D-NJ) (Sen. Harkin is a cosponsor). THOMAS Bill summary and status: http://thomas.loc.gov/cgi-bin/bdquery/D?d113:29:./temp/~bdw9U6::|/home/LegislativeData.php|
Preferred Lender Lists
- H.R. 1529, “Student Aid Expansion Act of 2013,” Rep. Joaquin Castro (D-TX). (Description: To amend the Higher Education Act of 1965 to exempt certain State-provided loan programs from being subject to preferred lender arrangement requirements.) THOMAS bill summary and status: http://thomas.loc.gov/cgi-bin/bdquery/D?d113:18:./temp/~bdw9U6::|/home/LegislativeData.php|
Click Here to see a chart of the proposed Market Based Solutions.
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