President Signs College Cost Reduction and Access Act

President Bush has signed into law the College Cost Reduction and Access Act of 2007, a budget-reconciliation bill that he says “will help millions of low-income Americans earn a college degree.”

Flanking the president as he signed the bill were U.S. Education Secretary Margaret Spellings; Rep. George Miller, D-Calif., chair of the House Committee on Education and Labor; Rep. Ric Keller, R-Fla., ranking Republican on the Higher Education, Lifelong Learning, and Competitiveness subcommittee; and a group of Pell-Grant recipients.

“The College Cost Reduction and Access Act expands one of America’s most important and successful education initiatives — the Federal Pell-Grant Program,” Bush said. “Pell Grants send an important message to students in need: If you work hard, and you stay in school, and you make the right choices, the federal government is going to stand with you.”

The new law increases funding for Pell Grants by $11.4 billion over the next five years. The funding will permit an increase in the maximum Pell-Grant award to $5,400 by 2012.

During the signing ceremony the president pointed to some problematic provisions of the legislation, noting that the “bill does, however, create new and duplicative programs that divert resources from the Pell Grants.”

Secretary Spellings expressed concern with potential implementation issues involving some of the changes the legislation makes to the student-loan programs. The administration previously has raised questions about the legislation’s provision for an auction of rights to make parent PLUS loans beginning in 2009.

Spellings also expressed the administration’s support for maintaining balance between the Federal Family Education Loan Program, the federal government’s largest student-aid program, and the direct-loan program, which funds student loans directly from the federal treasury, thereby adding directly to the national debt.

“It is critical for America’s students and their families that we maintain a healthy student-loan system and strong competition between the Federal Family Education Loan and Direct Loan programs,” Spellings said. “We will be monitoring this bill closely during implementation to ensure it does not cause unintended consequences, increase taxpayer costs or upset the vital competitive balance between the FFEL and DL programs.”