Thursday, February 7th, the House of Representatives passed HR 4137, the College Opportunity and Affordability Act of 2007 (Higher Education Act reauthorization) by a vote of 354-58. This legislation is a landmark for the Perkins Loan Program, since it demonstrates very strong support in the House for the program in a number of ways, only four days after the Administration again called for its destruction. COHEAO thanks the House for the strong bi-partisan support shown the Perkins Loan Program.

Passing by voice vote was a non-binding amendment offered by Representative Jay Inslee (D-WA) calling for funding of the Federal Capital Contributions to the Perkins Loan Program. Representative Ric Keller (R-FL) also spoke in support of provisions in the bill that strengthen the Perkins Loan Program. He further noted that the Perkins Program, along with Pell Grants, is the “heart of the HEA reauthorization.”

Specifically for the Perkins Loan Program the bill does the following:

• Reauthorizes the Perkins Loan Program through 2014.
• Prohibits the Department from requiring the assignment of defaulted Perkins Loans except in cases where schools fail to knowingly maintain records or decide to withdraw from the program or decide not to service the loans.
• Require the Department to return Perkins funds collected from voluntarily assigned loans to the institution that assigned them within 180 days, less collection costs of up to 30 percent.
• Raises annual loan limits to $5,500 for undergraduates and $8,000 for graduates, with commensurate increases in aggregate levels.
• Raises the maximum authorized Federal Capital Contribution from $250 million to $350 million per year. (Although this would encourage the Appropriations Committees to include funds for Perkins in legislation funding education programs, separate appropriations legislation is required to actually provide the money.)
• Raises the allowance for books and supplies from $450 to $600
• Eliminates the requirement that requests for forbearance be in writing.
• Reduces the number of on-time payments needed for loan rehabilitation from 12 to 9.
• Makes it easier for disabled veterans to have their loans discharged
• Expands the occupations for which Perkins Loans may be cancelled to include: full-time staff member in a pre-kindergarten or child care program that is licensed or regulated by the state; full time faculty member at a tribally controlled university; librarian with a master’s degree in library science who is employed in a school served under Title I of the EASEA, or a public library serving a Title I school; full-time speech language therapists with a master’s degree working exclusively in a Title I schools; and for full time firefighters.
• Expands disclosure requirements when a Perkins Loan is being consolidated to inform the borrower about loss of benefits, etc.
• Prohibits the Department from establishing a national unit record database.

COHEAO will need to work hard to get the Senate to accept the House language in a House-Senate conference committee that will put together a final bill. That process is expected to be completed within the next month or two.

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