UNIVERSITY PARK, Pa. — The uncertainty on an expired federal loan program that impacts 500,000 students nationwide was reduced yesterday in compromise legislation supported by Pennsylvania Sen. Robert Casey Jr. At a press conference this morning (Dec. 17), Penn State Vice President Robert Pangborn was on hand to thank Casey and emphasize the program’s importance to Penn State students, who rely on the low-interest loans to pay for college.
The new legislation will extend by two years for undergraduate students and one year for graduate students the life of the Perkins Loan program, which lapsed on Sept. 30, cutting off the ability for about 1,500 colleges and universities in the U.S. to make low-interest loans to new borrowers. Pangborn said that in the most recent academic year more than 2,600 students at Penn State were awarded $7.4 million, with an average award of $2,800.“At Penn State, we use the program to assist students with demonstrated financial need who are unable to pay for more than about 20 percent of education costs; priority is given to those with exceptional need,” Pangborn said. “In particular, this program has enabled students whose families experience sudden financial hardships during the school year to complete the semester and walk across the graduation stage.”Pangborn said that Penn State annually contributes funds to the program, making it more robust each year, despite the absence of federal contributions over the last decade. Upon graduation, students repay their loans directly to Penn State. Perkins Loans allow students to finance their education without being forced to borrow from costlier sources.Pangborn thanked Casey for serving as one of the U.S. Senate’s lead advocates for extending the Perkins Loan program, which he called an integral piece of some students’ financial aid packages.The agreement outlined by Casey is “an important bridge to reauthorization of the Higher Education Act, where a more thoughtful and deliberative discussion about federal student loans can take place,” Pangborn said. “For now this is an acceptable compromise that will enable financially needy students at Penn State to begin or continue their education.”Now the Senate-passed measure heads to the U.S. House of Representatives for consideration, expected in the coming days.
For the particulars of the legislation, click here.