House passes bill on student aid counseling

Rep. Brett Guthrie (center), chair of the House Subcommittee on Higher Education and Workforce Development, co-sponsored the student aid counseling bill. (Photo: House Education and the Workforce Committee)

The House on Wednesday passed a bipartisan bill to improve financial aid counseling for students who receive a Pell Grant or federal student loan.The Empowering Students Through Enhanced Financial Counseling Act (HR 1635) would require annual student aid counseling with students and parents and to get their consent that they understand their financial obligations before receiving a federal student loan.

The bill also would direct the U.S. Secretary of Education to maintain and share a consumer-tested, online counseling tool for colleges to use to provide annual loan counseling, exit counseling and annual Pell Grant counseling.

Even though Americans currently carry more than $1.4 trillion in student debt, recipients of federal student aid do not receive important information about loans and grants that they need to make informed financial choices, according to the House Committee on Education and the Workforce.

Almost 40 percent of community college students receive some type of federal student aid. About one-third of community college students receive Pell grants and 14 percent take out a subsidized federal loan, according to the American Association of Community Colleges (AACC).

AACC supports the bill and hopes some variation of it will be included in legislation to reauthorize the Higher Education Act.

The bill is sponsored by Rep. Brett Guthrie (R-Kentucky) and Rep. Suzanne Bonamici (D-Oregon). No similar legislation has been introduced in the Senate.

About the Author

Matthew Dembicki
is editor of Community College Daily and serves as publications director for the American Association of Community Colleges.