(Senate - October 26, 2017)

Text available as:

Formatting necessary for an accurate reading of this text may be shown by tags (e.g., <DELETED> or <BOLD>) or may be missing from this TXT display. For complete and accurate display of this text, see the PDF.

[Pages S6855-S6856]
From the Congressional Record Online through the Government Publishing Office []


      By Mr. REED (for himself, Mr. Durbin, Ms. Warren, and Mr. 
  S. 2028. A bill to provide for institutional risk-sharing in the 
Federal student loan programs; to the Committee on Health, Education, 
Labor, and Pensions.
  Mr. REED. Mr. President, we all recognize that a postsecondary 
education is required for most family-sustaining, middle-class jobs, 
and that an educated workforce is essential to a modern, productive 
economy. A report by the Georgetown University Center on Education and 
the Workforce found that college-level intensive business services have 
replaced manufacturing as the largest sector in the U.S. economy, and 
that while college-educated workers make up only 32 percent of the 
workforce, they now produce more than 50 percent of the Nation's 
economic output, up from 13 percent in 1967. A college degree also pays 
off, as median annual earnings for bachelor's degree holders were 
$23,000 higher compared to high school graduates in 2014.
  Yet just as there is growing recognition that postsecondary education 
is indispensable in the modern economy, families are being required to 
shoulder growing debt burdens that threaten access to college.
  According to an analysis of student loan debt by the Federal Reserve 
Bank of New York, between 2004 and 2014, there was an 89 percent 
increase in the number of student loan borrowers and a 77 percent 
increase in the average balance size. Today, over 40 million Americans 
have student loan debt.
  This is a growing drag on our economy. As student loan debt has 
grown, young adults have put off buying homes or cars, starting a 
family, saving for retirement, or launching new businesses. They have 
literally mortgaged their economic future.
  We know that student loan borrowers are struggling. A recent 
Department of Education analysis of outcomes for student loan borrowers 
who began their studies in 1995-96 and 2003-04 found that only 38 
percent of the 1995-96 cohort had paid off their loans without default 
after 20 years, and only 24 percent after 12 years. For the 2003-04 
cohort, only 20 percent had repaid their loans without defaulting after 
12 years. Worse, 52 percent of students who attended for-profit 
institutions had defaulted on a student loan within 12 years. Roughly, 
8.5 million borrowers currently have a loan in default.
  We have seen the costs to students and taxpayers when institutions 
are not held accountable. Corthinian Colleges and ITT are two examples 
of institutions that failed their students while benefitting from 
Federal student aid. Their fraudulent business practices eventually led 
to their demise, but not before leaving their students and taxpayers on 
the hook for millions of dollars in student loan debt.
  We cannot wait until an institution is catastrophically failing its 
students before taking action. Institutions need greater financial 
incentives to act before default rates rise. Simply put, we cannot 
tackle the student loan debt crisis without States and institutions 
stepping up and taking greater responsibility for college costs and 
student borrowing.
  That is why I am pleased to introduce the Protect Student Borrowers 
Act with Senators Durbin, Warren, and Murphy. Our legislation seeks to 
ensure there is more skin in the game when it comes to student loan 
debt by setting stronger market incentives for colleges and 
universities to provide better and more affordable education to 
students, which should in turn help put the brakes on rising student 
loan defaults.
  The Protect Student Borrowers Act would hold colleges and 
universities accountable for student loan defaults by requiring them to 
repay a percentage of defaulted loans. Only institutions that have one-
third or more of their students borrow would be included in the bill's 
risk-sharing requirements based on their cohort default rate. Risk-
sharing requirements would kick in when the default rate exceeds 15 
percent. As the institution's default rate rises, so too will the 
institution's risk-share payment.
  The Protect Student Borrowers Act also provides incentives for 
institutions to take proactive steps to ease student loan debt burdens 
and reduce default rates. Colleges and universities can reduce or 
eliminate their payments if they implement a comprehensive student loan 
management plan. The Secretary may waive or reduce the payments for 
institutions whose mission is to serve low-income and minority 
students, such as community colleges, Historically Black Institutions, 
or Hispanic-Serving Institutions--provided that they are making 
progress in their student loan management plans.
  The risk-sharing payments would be invested in helping struggling 
borrowers, preventing future default and delinquency, and increasing 
Pell Grants at institutions that enroll a high percentage of Pell Grant 
recipients and have low default rates.
  With the stakes so high for students and taxpayers, it is only fair 
that institutions bear some of the risk in the student loan program.
  We need to tackle student loan debt and college affordability from 
multiple angles. And we need all stakeholders in the system to do their 
part. With the Protect Student Borrowers Act, we are providing the 
incentives and resources for institutions to take more responsibility 
to address college affordability and student loan debt and improve 
student outcomes. I urge my colleagues to cosponsor this bill and look 
forward to working with them to include it and other key reforms in the 
upcoming reauthorization of the Higher Education Act.
      By Mr. REED (for himself, Mr. Coons, and Mr. Blumenthal):
  S. 2029. A bill to establish a National and Community Service 
Administration to carry out the national and volunteer service 
programs, to expand participation in such programs, and for other 
purposes, to the Committee on Finance.
  Mr. REED. Mr. President, as Americans, we take inspiration from those 
who have answered the call to serve, whether in defense of our Nation 
abroad or to strengthen our communities at home. This willingness to 
make common cause with our fellow citizens and serve a purpose greater 
than ourselves is a hallmark of our Nation. We should ensure that every 
American who wants to serve has the opportunity to do so. To that end, 
I am introducing the America's Call to Improving Opportunities Now 
(ACTION) for National Service Act with Senators Coons and Blumenthal. 
Our legislation calls for elevating the Corporation for National and 
Community Service (CNCS) to a cabinet-level agency and supporting up to 
one million national service positions annually.
  Since 1994, over one million individuals have served through the 
AmeriCorps program. Additionally, roughly 245,000 seniors over the age 
of 55 volunteer annually through the Senior Corps programs. These 
individuals have addressed critical community needs in education, 
economic development, health, and many other areas. They have come to 
their fellow citizens' aid in times of national disaster, including 
thousands who have been deployed in the wake of Hurricanes Harvey, 
Irma, and Maria. Unfortunately, we have not created the capacity to 
support all those who want to serve.
  Rhode Island has embraced service. Providence is one of the top 
AmeriCorps cities in the nation. Across our State, nearly 4,200 
AmeriCorps and Senior Corps volunteers are helping students succeed in 
school, ensuring veterans get access to the services they need, 
supporting seniors in their communities, protecting the environment, 
and addressing other critical needs. With additional resources and 
support, Rhode Island volunteers could accomplish so much more.
  We strive to honor those who serve. Even more importantly, we invest 
in the education and professional development of those who have 
sacrificed and given so much to our Nation. Developing the talents of 
our most committed citizens pays life-long dividends. Our investment in 
the GI Bill not only honors our service members, but also enriches our 
Nation. Similarly, the education awards for those who have served 
through CNCS programs have economic impacts beyond the individuals who 
earn them. Just as we came together on a bipartisan basis to expand and 
enhance the GI Bill benefits, now is the time to increase the education 
award for those who serve at

[[Page S6856]]

home. The ACTION for National Service Act will ensure that national 
service volunteers who complete two full terms of service earn an 
education award equivalent to four years of in-State tuition at a 
public university. Those who are willing to serve should not have to 
carry a heavy burden of student loan debt to achieve their educational 
  Today, as our communities face challenges in a host of areas, we need 
more people to participate in national service, and we need more 
partners to support them. As such, the ACTION for National Service Act 
will establish a National Service Foundation to encourage private 
sector and philanthropic investment in expanding national service 
  All AmeriCorps members take a pledge to get things done for 
Americans, to make communities safer, smarter and healthier, and to 
bring us together. Today, I ask my colleagues to join us in pledging to 
ensure that all who want to answer the call to serve can do so by 
cosponsoring the ACTION for National Service Act.