Last March, President Barack Obama went to Northern Virginia Community College to sign part of his Heath Care and Education Reconciliation Act in front of a cheering audience. As it happens, this addresses about half of what he promised when running for office. When campaigning, he actually proposed a six-point plan, a lot of which has to do with financial aid, which this new act covered only part of. Here’s the entire plan:
Create an Education Credit – Otherwise called the American Opportunity Tax Credit. This is designed to make $4,000 of a college education is completely free through a fully refundable credit at tax time. Not that students get off scot free. They must do 100 hours of public service a year as part of the agreement. Then again, who wouldn’t sweep streets for the basic rate of $40 an hour?
Simplify the Financial Aid Process – Obama believes getting federal grants and scholarships is more difficult than filing income taxes. The FASFA form needs to be simplified. His research believes it stops people filing for the Pell Grant, HOPE and Lifetime Learning tax credit programs. They even are talking about eliminating the FASFA altogether. Obama wants to put a simple box on the income tax form. Check that box off and it allows the IRS to send relevant information for the Pell and other money.
High School Preparation Tests – Obama believes many high school students are not what he calls “College Ready”. He’s proposed creating a voluntary test. With the results, a student will know what they need to be ready for college and still have the time to prepare for it.
Increase The Pell Grant – Also critical is increasing the Pell. Obama’s Reconciliation Act has started this, in part to the last point. He wants to increase the upper limit of the Pell from $5,350 to slightly under $6,000 as soon as possible. He has also wants a plan set up where the Pell automatically increases to whatever college tuitions rise up to.
The Community College Partnership Program – This is also part of the new Reconciliation Act. Obama feels community colleges have approximately 50% of all students. The Act calls for the start of what he’s calling a Community College Partnership Program. Its goal is to strengthen community colleges by providing grants. The school must be Title IV accredited, and according to sources inside the Board of Education, this also includes online schools.
Eliminate Federal Family Loan Program – The President stopped the Federal Family Loan Program. Banks are seriously not happy about this, mainly because they can’t put students in debt for life like they used to. The Federal Family Loan System involved federal money administered by banks. All loans will now be through the already existing Direct Loan system, which is administered by the Board of Ed. Obama projects this creates an incredible savings and generate revenue, with the profits going to the Pell.
Education is life changing. Those who go to college and get a degree have already increased their income potential before they are even hired. The college loans needed for many to attend college is addressed in the above plan. Changing how college loans are issued and upping Pell grants for college and &LINK3% may just mean untold numbers of people will have a better change right from the start.