A bill introduced to the U.S. House has the potential to slash federal financial aid funding for low-income undergraduate students at the University of Minnesota.
The Promoting Real Opportunity, Success and Prosperity through Education Reform Act was drafted to reauthorize the existing Higher Education Act, which was first passed in 1965 with the goal of providing financial aid to students and increasing educational resources for colleges and universities. Proponents of the bill say it will better prepare students for responsibilities of the workforce.
In June, the bill came close a vote, prompting many students, colleges and universities to voice their concerns. House Majority Leader Kevin McCarthy, R-Calif., is currently seeking support from House members before moving it to the floor for a vote.
The Committee on Education and the Workforce drafted PROSPER in hopes of preparing students for the workforce, streamlining financial aid and holding institutions accountable for students’ success, said committee deputy press secretary Marty Boughton.
The bill proposes eliminates direct subsidized loans. The federal government pays interest on these loans for qualifying undergraduate students while that student is still in school.
The University has approximately 16,300 students who receive subsidized loans, or 31 percent of its total degree-seeking undergraduate population, said Tina Falkner, director of student finance at theOffice of Student Finance.
“There is an elimination of federal financial aid and it appears that the majority of that elimination would impact our low-income students and their families,” Falkner said.
University President Eric Kaler told the Minnesota Daily in June that he opposes the act because it would hurt students through its financial aid cuts.
“The overall impact I think will certainly be a net negative and that will harm access to higher education for college students in America and that’s a terrible thing to do,” he said.
On June 12, the 14 Big Ten university student body presidents collectively sent a letter to U.S. representatives urging them to vote against the legislation.
“This letter is kind of a continuation of the advocacy that we have been prioritizing,” said Minnesota Student Association President Simran Mishra.
In addition, the act would eradicate the Public Service Loan Forgiveness Program, which can forgive the tuition loans of a student who pursues a public service career.
Many careers in public service are low-paying but vital to the communities they serve, so it’s important to give people incentive to pursue them, Mishra said.
Boughton said these proposed changes would hold institutions more accountable for its students graduating on time.
PROSPER would “treat financial aid like a paycheck,” in that students receive aid on a weekly or monthly basis, Boughton added.
With the goal of streamlining the federal loan process, the bill would drop the Federal Supplemental Educational Opportunity Grant, which provides aid to approximately 7,500 University students in need, Falkner said.
“Right now, it does not seem like… that there is enough support within the House to bring this to a floor vote even,” Falkner said. “I think part of the reason PROSPER hasn’t been making progress… is that there has been a lot of concern voiced by students, by colleges and universities, and it matters.”
Correction: A previous version of this story said that the PROSPER Act would require students to work in order to receive federal financial aid.