Hagan pushes for lower student loan interest rates

nhaggerty@charlotteobserver.comJuly 3, 2013 

College Affordability Roundtable_01

U.S. Sen. Kay Hagan

DAVIE HINSHAW — dhinshaw@charlotteobserver.com Buy Photo

Nathan Lane, a student at Central Piedmont Community College, has participated in work study, worked part-time at the library and has a security job to help pay for college.

He worries about this week’s doubling of interest rates for Stafford loans from 3.4 percent to 6.8 percent, because Congress could not agree on a plan by July 1 to keep the rate steady.

Sen. Kay Hagan, D-N.C., pushed the Keep Student Loans Affordable Act in a roundtable discussion at UNC Charlotte Center City with Lane and leaders from UNC Charlotte, Queens University of Charlotte, Johnson C. Smith University and Central Piedmont Community College.

The act would extend the 3.4 percent rate for another year.

Lane, who wants to transfer to UNC Charlotte and work for the Peace Corps, said he hopes Hagan’s bill passes.

Hagan, who co-wrote the bill with Sen. Jack Reed, D-R.I., said the average student debt in North Carolina is about $23,000, which makes it difficult for students to buy homes and build families after they graduate.

“Debt is burdening our students,” Hagan said. “I am not willing to accept that fate for our students.”

UNC Charlotte Chancellor Philip Dubois, who was a first-generation college graduate, said there has been a 16 percent decline in general state funds to public education, and students still need financial aid.

He said investment in education will only improve society, because college graduates are more likely to vote, less likely to commit crime and less likely to be unemployed.

Dubois said students are aware of financial pressures because they are working many hours beyond the time they take to study.

“I meet as many students waiting tables as I do on campus,” Dubois said.

Johnson C. Smith University President Ronald Carter said 100 percent of the students at his school receive some sort of financial aid. But tougher standards for another loan program already push people out of Historically Black Colleges and Universities.

Carter said the increases in interest rates on student loans are creating a group of “untouchable” students who are able to afford college and another group who can’t. He said the latter group will represent a majority by 2020.

Hagan asked the colleges if online courses are of any benefit financially.

CPCC President Tony Zeiss said the college has used hybrid courses that include in-class and online instruction, but students are not as successful in these courses.

Dubois also said that technology and course development needed for online instruction is also expensive.

Senate Minority Leader Mitch McConnell, R-Ky., has criticized the Hagan-Reed bill and argues that it contains a tax increase.

In claiming that the bill would increase taxes, McConnell most likely is referring to the way the lower interest rates would be funded. It would close a tax loophole over inherited retirement accounts. The McClatchy Washington bureau contributed.

Haggerty: 704-358-6180

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