Student Aid and Fiscal Responsibility Act
The Student Aid and Fiscal Responsibility Act (SAFRA) of 2010 ensures that all federally funded student loans will be directed through the federal government’s Direct Loan Program (DLP,) saving taxpayers $61 billion and using that money to fund the rest of the bill. It abolished the Federal Education Loan Program (FFELP)—which used publicly subsidized private loan companies to provide student loans.
SAFRA provided the Pell grant program with an infusion of $36 billion (over 10 years), increasing the maximum award to $5,550 in 2011. SAFRA also ensures the program’s benefits will now grow with inflation every year, plus one percent. SAFRA makes student loan interest rates variable, but caps interest rates at 6.8 percent to protect borrowers from unreasonably high rates.
SAFRA also increased funding for community colleges ($2 billion in available grants).
Cry Wolf Quotes
There's Washington, and then there's the rest of the country. This is the rest of the country….We don't want just any old jobs. We want our jobs.
Ultimately, what they are trying to create here is the Post Office of student lending — you've got no choice.
Legislation passed by the U.S. House of Representatives, however, would require all federal student loans to be originated by the federal government, jeopardizing hundreds of private sector jobs in Wilkes-Barre and hampering related economic development in the state. Sallie Mae currently contributes more than $40 million annually to the local economy and has contributed millions to local charities.
We’ve been overwhelmed by the outpouring of support from the community. At a time when jobs are so scarce here and around the country, we hope that this petition delivers 31,000 more reasons to support student loan reform that will make college more affordable and protect jobs here in Wilkes-Barre.
Evidence
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5 Myths About Student Loan Reform
Campus Progress: Almost all of the student loan industry's warning about SAFRA were wrong.
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Are Student Loan Companies Playing Politics With People’s Jobs
The definitive refutation of “job killer” cry wolf claims regarding SAFRA.
