August 5, 2002
Contact: Stephanie Babyak
Jane Glickman
(202) 401-1576
Paige Hails Additional $1 Billion in Funds to Help Needy Students Attend College
President Bush Signs FY 2002 Emergency Supplemental Appropriations Bill to Help Fully Fund Pell Grant program
U.S. Secretary of Education Rod Paige praised the inclusion of an additional $1 billion in the FY 2002 emergency spending bill signed by President Bush on Friday. Paige said that the additional funds that the Bush administration fought hard to secure would help ensure that 4.4 million students have the finances to pursue a postsecondary education this year.
Paige noted that the president urged Congress last year to increase funds for the Pell Grant program to provide the $4,000 maximum award promised to our neediest students. "This additional billion dollars will ensure that millions of low-income students who depend on Pell Grants will not face any decrease in their grants. We are glad Congress approved the president's request for additional funding needed to help our neediest students afford college."
The request for additional Pell Grant funds reflects the Bush administration's strong support for students pursuing higher education.
- Since taking office, President Bush has proposed nearly $3 billion in increased funds for the Pell Grant program-the largest amount proposed by any president. Under the president's budget plan, nearly half a million more students would receive Pell Grants than before he took office.
- President Bush signed a new law in February that keeps interest rates low in the Stafford student loan program. Interest rates on student loans are currently as low as 4.06 percent.
Paige also noted that there are more than $22.7 billion in education-related benefits for American working families in the president's tax relief measure enacted last year, including provisions that:
- Eliminate the 60-month limitation on student loan interest deductions and increase the income levels of individuals able to claim the deduction. This change makes the tax benefit simpler to administer and increases the affordability of student loan repayment;
- Increase the annual limit on contributions to education savings accounts from $500 to $2,000;
- Add a new above-the-line deduction for qualified higher education expenses;
- Allow tax-free distributions from Qualified Tuition Plans (Section 529 plans) used to pay educational expenses and permitting private institutions to offer such plans; and
- Make the income exclusion for employer-provided education assistance permanent and extend the benefit of the exclusion to graduate level courses.
Paige said, however, that there is still more work to be done to advance the president's other higher education priorities, pointing to the president's request to more than triple the student loan forgiveness for mathematics, science and special education teachers in low-income schools. Under the president's proposal, these teachers would qualify for up $17,500 in loan forgiveness for teaching in high-need schools for five years.
He stated that the strong working relationship with the Congress makes him optimistic about moving forward on the president's higher education agenda. "By working together," Paige said, "The administration and Congress have succeeded in opening the doors of opportunity for all Americans. We look forward to building on this foundation when Congress considers major higher education legislation next year."
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