President George W. Bush signed the College Cost Reduction and Access Act Thursday. The bill will give $20 billion to higher education financial aid. Democrats from the House of Representatives drafted and have been working on the bill, which is meant to benefit those students who need money for college the most.
The bill will fund Pell Grants, which are given to students who are on a need-based income. The bill is a result of balancing the budget.
“Congress and President Bush will increase Pell Grants by swapping money around from reducing subsidized student loan interests rates and benefits,” said Bruce Crain, MSU’s director of financial aid.
In effect, students borrow money for school from banks. Banks get the money for students from the government. When students begin paying back the loan, they have certain amounts of time before the government will take over the loan from the bank, which allows the bank to make a profit.
Bankers will entice students to borrow from their banks by offering incentives such as reduced payments.
Money to increase Pell Grants will come from these special benefits, which means that some students who borrow money may not receive those benefits.
“As of today, the amount that students can receive from Pell Grants is $4,320. Over the next 5 years, that number will gradually increase to $5,400,” Crain said.
This amount is especially positive for MSU because the amount will cover the cost of tuition at MSU.
State Rep. John Mayo said Pell Grants play a big role in higher education.
“Without Pell Grants, a lot of Mississippians would not be going to college,” he said.
Mayo said this bill is a way for the government to show its support for education.
“This is an indication of how important college education means to the country,” he said.
Both the House of Representatives and Congress have signed on the bill. It is now up to Bush to decide if the terms will work for the great of the country.
“If Bush does not sign off on this bill, there will probably be one very similar to it that will be developed and eventually signed,” Crain said.
The bill will affect the state of Mississippi because a majority of the students attending state schools already have Pell Grants.
With the bill in place, many more people will be able to attend an institution of higher learning.
“All in all [this bill] is moving in the right direction,” Crain said.
“I don’t think MSU students will see much differences on the whole, but it will be positive for the need-based students.