Congressman Rick Larsen's Online Office

Washington, D.C. — Today, U.S. Representative Rick Larsen (WA-02) voted for the largest single investment in aid that will help students and families pay for college. The Student Aid and Fiscal Responsibility Act (SAFRA) will shift all new federal student lending to the Direct Loan program, generating funds that will be reinvested in Pell Grants, community colleges and other education initiatives — all at no cost to taxpayers.

“Tuition for undergraduates is soaring at record rates. Investing in student loan reform will help students and families afford these sky-rocketing tuition payments,” said Rep. Larsen. “During these tough economic times, it’s essential that we provide the next generation with the tools they need to attend college and get career training so they can secure good jobs after graduation.”

The legislation, which is now on its way to the President to be signed into law, would save $61 billion over 10 years by ending subsidies to banks, replacing that with direct-to-student lending by the federal government. About $10 billion of the savings would be set aside to reduce the federal budget deficit, $13.5 billion would be used to cover the shortfall in the Pell Grant program and $23 billion to increase the size of the grants.

“By ending subsidies to banks, we are taking money from the big banks that drove us into this fiscal mess and putting it back in the pockets of mom and dad so they can afford to send their kids to college,” said Rep. Larsen. “Student loan reform will being much-needed financial relief to students and families left struggling under the enormous weight of tuition costs and loan repayments.”

This bill also includes an increase in government grant and loan assistance for college tuition payments. Annual Pell grants would increase from $5,550 to $5,975 by 2017. Pell Grant funding for Washington would roughly double over the next year to $464 million under the measure.

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