When it comes to keeping college affordable, three pieces of news have recently come out of Washington, D.C.
- One is what has and hasn’t happened to the Perkins Loan program. This is a need-based student loan program offered by the U.S. Department of Education that helps students by carrying a fixed low interest rate. Congress had let the program expire in the fall, but it was revived for two more years by legislation passed in December. Although far from perfect, this extension will allow Congress to revisit the program again. Many hope that the program will be permanently extended and eligibility standards restored. Perkins helps students avoid taking out private student loans that charge higher rates.
- Another significant piece of news from the federal government has been an increase in funding for federal Pell Grants. The recent federal budget bill increased the maximum Pell Grant by $140 to $5,845. This is a positive development, one that helps keep college affordable and within reach for more students from lower-income families. In addition, the budget bill put new funds into proven TRIO and GEAR UP college access programs.
- And the third development that emerged in December in the budget deal between Congress and the White House is that the American Opportunity Tax Credit will be permanent. This is the most generous tuition benefit available to students and families, allowing a $2,500 credit against tuition expenses annually for individuals earning less than $80,000 and $160,000 for married/joint filers. Previously set to expire in 2017, it will now be a permanent benefit.