MADISON, Wis. — Following a packed hearing before the state Senate last week, a large crowd of student loan borrowers, experts and legislators provided testimony to the Assembly Colleges and Universities Committee on Monday in support of Assembly Bill 498, the Higher Ed, Lower Debt Act.
One Wisconsin Now Executive Director Scot Ross commented, “These hearings have given legislators a glimpse of the groundswell of support for action to help the hundreds of thousands of hard-working Wisconsinites who got an education and job training and took on the personal responsibility to pay for it. The system is broken, and failing to act will hurt borrowers and slow economic growth.”
In his testimony before the committee Ross summarized the findings of original research by One Wisconsin Institute showing the detrimental impact on borrowers and the state economy of Wisconsin’s share of the $1.2 trillion in student loan debt held nationally. Among the findings, residents with a four-year undergraduate degree are paying an average of $350 per month for an average of nearly 19 years. The fallout includes severely reduced rates of homeownership of borrowers versus non-borrowers and over $200 million in lost new car purchasing power.
The non-partisan Legislative Fiscal Bureau estimates over 753,000 Wisconsinites are paying off federal student loans with an unknown additional number of borrowers with private loans. The Higher Ed, Lower Debt Act, which has 54 cosponsors, would offer a number of common sense state solutions to help current borrowers and help educate future borrowers by:
- Creating a state authority to help borrowers refinance their student loans, just like you can a home mortgage;
- Allowing borrowers to deduct their student loan payments on their state income taxes, just like you can with home mortgage interest;
- Requiring borrowers be given detailed information before entering into loan agreements, offering counseling to students and parents on the implications of student loans and requiring the state to collect and disseminate information about private lenders and maintain a ranking system; and
- Tracking information about student loan debt in the state to help policy makers better understand the depth and breadth of the debt crisis in Wisconsin.
In addition, organizations representing state businesses, teachers, dentists, social workers and organized labor have registered their official support for the Higher Ed, Lower Debt Act.
Ross concluded, “The public has spoken out loud and clear and now it’s up to state legislators. Will they stand idly by and let higher education become a multi-decade debt sentence for their hard-working constituents? Or will they support common sense solutions to protect the idea that hard work and personal responsibility should earn you a fair shot at the middle class?”