Sen. Mark Warner is currently pushing legislation that affects college students. Two bills are being discussed that affect federal student loans and the repayment of college debt.
Warner participated in a conference call with student journalists. He took questions and discussed his own thoughts on the two bills. Warner himself was among the first generation of his family to go to college and expressed in a news release that student debt is a problem.
In America alone, estimates show that student debt is over $1.4 trillion dollars with the average person’s debt amounting to approximately $29,000.
“If I had that much debt coming out of college, I’m not sure I’d be sitting where I am now,” Warner said.
The Employer Participation in Repayment Act is a “no-brainer” according to Warner. Employers may already use pre-tax dollars from wages to help finance degrees currently being pursued by employees, but the Employer Participation in Repayment Act would allow employers to do the same with previous college debt.
“It’s always kind of frustrated me that it’s taken this long to get through,” Warner said.
The bill would allow a tax break for both the employee and the employer by amending the Internal Revenue Code of 1986 sec. 127. The hope is that employers can also use this tool as a hiring benefit.
The Dynamic Repayment Act attempts to simplify and consolidate the federal loan programs into one income-based program repayment. The loan would not be subsidized, but would remain similar to the Stafford Loan. Interest rates would also remain the same.
With income based repayment, those who make $10,000 or less would have no payment obligation.
“When you get rich, then you pay,” Warner said.
The bills have supporters from both political parties and would go into effect at the end of the year if they pass.
“I do actually believe that this year we may see some action on these bills,” Warner said.