Proposals Offer Some Relief to Hurricane-Ravaged Postsecondary Institutions

The U.S. Department of Education is asking Congress for some $227 million to help students and postsecondary institutions in areas of Alabama, Louisiana and Mississippi that were ravaged by Hurricane Katrina. The department has proposed the following relief measures:

• Forgive six months of interest on all student loans for borrowers in the affected areas.
• Provide payments of $1,000 per student to colleges and universities receiving students who were displaced by the hurricane. The funds would help meet the unexpected costs associated with educating these students.
• Permit postsecondary institutions that have been forced to temporarily cease operations because the hurricane damage to retain student aid already received for the new academic year. In addition, students would be relieved of any obligation to repay the federal aid that they received for the current term at these colleges and universities that have temporarily ceased operations.

Meanwhile, emergency legislation has been introduced in the U.S. Senate to aid students and schools in the region. The Hurricane Katrina Education Relief Act would permit the Secretary of Education to waive certain student-aid requirements. The student-aid provisions of the bill include the following items:

• Relieve students who received Title-IV grant funds, but who were unable to attend a postsecondary institution in the affected areas, from requirements to return the grant aid.
• Extend until June 30, 2010, the date by which institutions in the affected institutions are required to return unearned Pell-Grant and SEOG funds.