[Congressional Record Volume 155, Number 132 (Thursday, September 17, 2009)]
[Extensions of Remarks]
[Pages E2314-E2315]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




           STUDENT AID AND FISCAL RESPONSIBILITY ACT OF 2009

                                 ______
                                 

                               speech of

                     HON. STEPHANIE HERSETH SANDLIN

                            of south dakota

                    in the house of representatives

                     Wednesday, September 16, 2009

       The House in Committee of the Whole House on the State of 
     the Union had under consideration the bill (H.R. 3221) to 
     amend the Higher Education Act of 1965, and for other 
     purposes:

  Ms. HERSETH SANDLIN. Madam Chair, the House is considering H.R. 3221, 
the Student Aid and Fiscal Responsibility Act. I support many of the 
goals of this legislation, including finding savings in the current 
student loan program and directing these funds toward expanding student 
grant aid that will help make higher education a reality for more South 
Dakotans. However, I have heard from constituents who work in the 
Federal Family Education Loan Program, FFELP, in my State, and in 
particular from The Student Loan Corporation in Sioux Falls, that the 
enactment of this bill could result in the loss of hundreds if not 
thousands of jobs in South Dakota during this period of continuing 
higher unemployment, as the country works its way out of economic 
recession. I also have concerns about completely eliminating a role for 
the private sector in providing student loans and about the potential 
disruptions in access to loans for students that could occur during the 
proposed transition to the new system over the next months.
  I have helped to lead the effort in the House of Representatives with 
my colleague and fellow Blue Dog. Allen Boyd of Florida, and we've been 
joined by a number of our colleagues in the House of Representatives in 
sharing our concerns on this subject with U.S. Department of Education 
Secretary Arne Duncan and with the House Education and Labor Committee. 
I urged the Secretary and the Committee to more fully consider all 
possible alternatives that would substantially increase funding for 
Pell Grants and other important sources of financial access to higher 
education, while maintaining jobs in our districts and ensuring 
continued access to loans for students. Over the course of the FFELP's 
decades of existence, it has proven that private competition in the 
student loan system provides benefits to students. I believe that the 
FFELP has been a cost effective alternative to ``direct lending'' for 
many students in South Dakota. In addition, I am concerned that the 
Department of Education may not have the resources adequate to handle 
the origination,

[[Page E2315]]

administration and servicing of all student loans beginning in July 
2010.
  The assumption of complete responsibility for providing federally-
backed loans to students by the Department of Education Direct Loan, 
DL, program presents very real risks of job losses and ends the 
reliable administration and servicing of student loans at the more than 
4,000 schools that are not currently enrolled in the DL program, 
including most colleges and universities in South Dakota. While a 
number of these schools have begun exploring a transition to DL with 
the Department of Education, the risks of a possible disruption in 
students' ability to access student loans is very real during the rapid 
transition of these 4,000 schools to DL by July 10, 2010. Further, we 
do not want to put undue resource burdens on schools and States that 
are already facing increased budgetary pressures during this economic 
downturn.
  While the bill does present potential opportunities for some lenders 
in South Dakota, overall, the possible downsides of the bill for South 
Dakota are substantial, and what's more, I believe they could be 
addressed in this legislation while preserving the goal of increasing 
financial assistance for higher education. Thus, while I fully support 
the goal of finding savings within the current student loan program to 
provide students with much-needed increases in federal financial aid 
for higher education, I cannot support today's bill, which I believe 
should be improved before being passed by the House.
  As the legislative process moves forward in the Senate, I will 
continue to work towards a bill that achieves significant increase in 
financial assistance for students seeking higher education, that 
preserves jobs for South Dakotans, and ensures our students receive the 
specialized attention and information needed to make the best choices 
for funding their higher education.

                          ____________________