House loan bill up for renewal

A bill in the Indiana House of Representatives, which could affect student loan consolidation, has come up for debate once again.\nHouse Resolution 507 seeks to renew the Higher Education Act of 1967 with certain legislative action and several revisions to offset government costs.\nThe provision to the resolution would prevent borrowers of federal loans from being able to secure a low, fixed interest rate if the bill is passed. Other provisions to the resolution include keeping the authorized level for the Pell Grant at $5,800 for the next six years, providing Pell Grants year-round instead of nine months and phase out programs such as Work-Study, Perkins Loans and Supplemental Educational Opportunity.\nThere are many differences in opinion about the bill between the top officials of the College Democrats and College Republicans.\nThe Indiana Republican Party introduced this bill because it will help in the Financial Aid process, said junior Andrew Lauck, president of the IU \nCollege Republicans.\n"I see it as one of the steps by Congress to help simplify the Financial Aid process," Lauck said. "(In addition) President Bush has proposed increasing the loan limit on the Stafford loan."\nFreshman Mike Doyle, financial vice president of the IU College Democrats disagrees with Lauck.\n"Although (Republicans) are technically not raising the interest rates, they are not going to keep it at a low, fixed rate," Doyle said. "You want to keep the interest rates low, especially when you are dealing with young students."\nIn addition, the new version of the bill would clarify that student-aid applicants who have been convicted of drug-related offenses are ineligible for federal student aid if the offense occurred during their time in college. \n"You are using federal government money to purchase drugs," Lauck said. "The (students) who are purchasing drugs are not focusing their main priorities on education."\nAnother provision of the bill would be to place colleges that raise tuition by more than twice the rate of inflation on a government watch-list. \nA similar bill that attempted to change how the interest rate is calculated was defeated last summer because of debate about whether or not the bill would make the program less feasible to borrowers. \nRepublicans had expressed concern about introducing the bill at a time that might provide Democrats with a reason to criticize the White House during an election year.\nLauck and Doyle also disagreed on the Pell Grant aspect of the bill. While Lauck said it was a way for the government to eliminate bureaucracy from the process, Doyle said in comparison to 30 years ago, students will be receiving $800 less.\n"What they are doing is withholding money from students when they really need it," Doyle said.\n-- Contact Staff Writer Ryne \nShadday at rshadday@indiana.edu.