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Obama signs bill to relieve education costs

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March 30, 2010

President Obama signed a piece of legislation Tuesday morning that is being considered one of the most significant changes in the history of student financial aid reform.

Obama signed The Student Aid and Fiscal Responsibilities Act Tuesday morning at Northern Virginia Community College. The act includes intentions to make paying for college and completing a degree easier. Obama hopes by enacting these changes, the U.S. will produce the most college graduates in the world by 2020.

Virginia Governor and Chairman of the Democratic National Committee Tim Kaine held a conference call Tuesday afternoon to discuss the significance of the act.

“The Student Aid and Fiscal Responsibilities Act is a huge step forward for students and also for the American economy,” Kaine said.

Kaine said one change the act will bring about is eliminating unnecessary subsisides on students loans. SAFRA will eliminate grants given to private financial institutions, and the new bill will provide lower-interest loans directly from the government.

President of the College Democrats of America Katie Naranjo was present for the conference call and applauded the work that went into the creation of the bill.

“No one should be denied education just because they can’t afford it,” Naranjo said. “We are very lucky to have not only a president who listens to young people, but members of Congress who will help pass landmark legislation like this.”

How SAFRA may affect you:

Invests $36 billion over 10 years to increase the maximum annual Pell Grant scholarship to $5,550 in 2010 and to $5,975 by 2017. Starting in 2013, the scholarship will be linked to match rising costs of living by indexing it to the Consumer Price Index.

Invests $750 million to bolster college access and completion support for students. It will increase funding for the College Access Challenge Grant program, and will also fund innovative programs at states and institutions that focus on increasing financial literacy and helping retain and graduate students.

Invests $2.55 billion in Historically Black Colleges and Universities and Minority-Serving Institutions to provide students with the support they need to stay in school and graduate.