New plan increases college aid
By ERIN PIROUTEK
Assistant News Editor
With college tuition rapidly outpacing the rate of inflation, financial worries rank with chemistry tests as major sources of stress for many students. Especially at private institutions like Notre Dame and Saint Mary's, students and their families often make great sacrifices to afford education.
Help may be on the way.
In a press conference last week, President Bill Clinton unveiled plans to help students pay for higher education.
"When we make college more affordable, we make the American dream more achievable," Clinton said.
The plan's central component is the "College Opportunity Tax Cut." Phased in over 10 years, the $30 billion program would provide an average of $10,000 in tax deductions per middle class family as well as a possible $2,800 in tax credits for each student.
The plan also removes the 60-month limit for deducting interest paid on student loans and increases Work-Study funding by $77 million.
Additionally the maximum Pell Grant, aimed to aid low-income families, would increase from $3,300 to $3,500.
Sue Brandt, associate director of Financial Aid at Notre Dame, applauded this move.
"They're increasing grant money to the neediest of students," she said.
The GEAR UP program, which targets middle school students from low-income families, would receive an additional $125 million.
The program enlists the support of colleges to provide students with opportunities to eventually receive post-secondary education.
Brandt noted that the proposals cover all phases of college education. The Pell Grants help students while they attend school.
Tax credits benefit students' parents, who often shoulder a large portion of educational costs.
Making interest tax-deductible helps students repay loans after graduation.
But students shouldn't rejoice yet. The measures, which will be appended to the administration's fiscal 2001 budget proposal, need Congressional approval — a formidable hurdle in this election year.
"Major things will have to wait on the next president and the next Congress," Senate Majority Leader Trent Lott (R-Miss.) told reporters last Wednesday.
Despite apparent benefits, Brandt stressed the need to be cautious about approval of the plan.
"Right now we don't have enough information," she said, noting that other programs could potentially be cut to pay for the proposed increases.
The proposal will expand upon currently available education tax credits. The Lifetime Learning tax credit is now a $1,000-per-family credit that is applicable for any year of post-secondary education.
The Hope tax credit — which remains unchanged in Clinton's plan — provides up to $1,500 per student during the first and second years of college. Family income determines eligibility for the credits.
There is little that student aid offices at universities can do to influence Congressional votes on Clinton's proposal, but they are able to help students make the greatest possible use of existing aid programs.
All News Stories for Thursday, January 27, 2000
