[Congressional Record Volume 143, Number 5 (Wednesday, January 22, 1997)]
[Senate]
[Pages S589-S590]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                    SAFE AND AFFORDABLE SCHOOLS ACT

  Mr. McCONNELL. Mr. President, I rise in support of S. 1, the Safe and 
Affordable Schools Act. I am pleased Senator Coverdell has introduced 
this important legislation which will provide our children with an 
affordable, quality education. By making this bill the first bill of 
the 105th Congress, it demonstrates to the American people the 
importance this Senate has placed on the education of our children.

[[Page S590]]

  I would like to comment on a very important provision contained in 
this bill which will make higher education more affordable. For the 
past several years, I have worked to allow the earnings invested in 
State-sponsored tuition savings accounts to grow tax-free when used for 
higher education expenses. This bill also will cover room and board 
cost. These changes will help families offset the rising cost of 
education by rewarding those who save.
  For the past several years, I have worked to eliminate the tax on 
education savings. In 1994, I first introduced S. 1787, to make a 
family's investment earnings tax-free when invested in a State tuition 
savings plan. Again, in the 104th Congress, I introduced a similar 
bill, S. 386. Both bills were endorsed by the National Association of 
State Treasurers and their College Savings Plan Network, which 
represents the individual State programs.
  On July 9, 1996, Congress passed many of the reforms proposed in S. 
386, as part of the Small Business Tax Relief Act of 1996. This 
legislation was signed into law by the President on August 20, 1996.
  While we made important gains last year, we need to finish what we 
started and fully exempt investment income from taxation. This 
legislation does that. It also expands the definition of qualified 
education expense to include room and board. Such costs make up nearly 
50 percent of annual college expenses.
  The facts are clear; education costs are outpacing wage growth and 
have created a barrier for students wanting to attend college. 
According to the General Accounting Office, tuition costs at a 4-year 
public university rose 234 percent between 1980-94. During this same 
period, median household income rose only 84 percent. It is no wonder 
fewer families can afford to send their children to college without 
financial assistance.
  As tuition costs continue to increase, so does the need for 
assistance. In 1990, over 56 percent of all students accepted some form 
of financial assistance.
  Today, it is increasingly common for students to study now, and pay 
later. In fact, more students than ever are forced to bear additional 
loan costs in order to receive an education. In 1994, Federal education 
loan volume rose by 57 percent from the previous year. On top of that, 
students have increased the size of their loan burden by an average of 
28 percent.
  So, not only are more students taking out more loans, they are taking 
out bigger loans as well. This year, nearly half of college graduates 
hit the pavement with their diplomas in one hand and a stack of loan 
repayment books in the other.
  I believe we need to reverse this trend by boosting savings and 
helping families meet the education needs of their children before they 
enter college. If we continue to ignore this problem, more and more 
children will be forced to burden themselves with an increasing debt 
load when they go in search of their first job. This can be avoided 
with passage of S. 1.
  Mr. President, in an effort to build on the accomplishments of last 
year, I look forward to working with Senator Coverdell, the sponsor of 
this legislation, and the Senate Labor and Finance Committees to help 
families meet the rising cost of higher education.

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