Legislation introduced this week in the U.S. House would extend the federal Perkins Loan program – which provides student loans to low income families – for another two years.
Reps. Elise Stefanik (R-NY), Mark Pocan (D-WI) Louise Slaughter (D-NY), John Duncan (R-TN), Ileana Ros-Lehtinen (R-FL) and Mark DeSaulnier (D-CA) introduced the Perkins Loan Extension Act of 2017 – bipartisan legislation to extend the Perkins Loan Program for a period of two years. The Federal Perkins Loan is a popular and effective campus-based financial aid program, which supports access to higher education by providing low interest loans to students in need.
Absent Congressional action, the Perkins Loan program will expire at on September 30, 2017, leaving around 500,000 students without access to financial aid. Roughly two-thirds of Perkins borrowers are dependent students, 34 percent of whom are from families with household incomes of less than $30,000. One-fifth of Perkins borrowers are independent students, 70 percent of whom have personal incomes of less than $20,000.
“Perkins Loans are an important resource for low income families in my district who are pursuing their higher education dreams,” Stefanik said. “As the first member of my immediate family to graduate from college, I know how critical a college degree is to succeeding in a 21st century economy. We must ensure that low income students have access to a quality education, and the Perkins Loan program is a critical tool to help them succeed.”
Pocan said many students and families would be left with few options to cover college expenses without this program.
Unlike many other student loan programs, Perkins is administered directly by colleges and universities who originate the loans, counsel their students through repayment, and select contractors for servicing and collection. Colleges and universities tailor the program to best fit borrowers’ and institutions’ situations. Perkins is a risk-sharing program with institutions contributing one-third of their students’ awards. This “ownership interest” also contributes to the successful management of this vital program.
“This program provides low-interest loans that are paid back to the student’s college, creating a revolving system that supports the next class of deserving students,” Slaughter said. “With no additional funding from the federal government, Perkins loans will continue to help low-income students attain an education and allow them to break the cycle of poverty. It is inexcusable that some politicians are targeting this program for elimination since without Perkins, 500,000 low-income students across the country—nearly 50,000 from New York State and over 6,000 from my district alone—would not have access to a critical safety net.”