President Clinton signed the Higher Education Reauthorization Act into law Wednesday night after the House and Senate unanimously approved it last week.
The action extends the bill, which authorizes a decrease in student loan interest rates and an increase in the maximum level of Pell Grant money, for another five years.
The interest rate reduction cuts federal loan interest rates from 8.2 to 7.4 percent — the lowest interest rate in 17 years.
“It sounds like a good deal for students,” said Board of Regents member William Peterson, who questioned whether the interest rate couldn’t have been lowered even further. “When you look at mortgage loans going for 6.5 percent, I think educating our students should be a top priority.”
The legislation also calls for a new formula to protect the rates from increases in outside interest rates.
The amount of money students can receive for Pell Grants will increase from $3,000 to $4,500 for the 1999-2000 school year. It will increase $300 annually for the following three years. For the 2003-04 school year, the grant will increase $400.
However, Congress’ authorization of Pell Grant increases does not guarantee the availability of funds for the project. Historically, Congress has authorized such projects and not had the funds to support them.– Jennifer Niemela