The senate passed The Higher Education Access Act of 2007 Thursday.
A similar bill, the College Cost Reduction Act of 2007, passed in the House of Representatives.
An amendment proposed by Senators Ben Nelson (D-Neb.) and Richard Burr (R-N.C.) called for $3 billion to go to lenders in an effort to increase competition among lenders and benefit smaller lenders. The amendment failed.
Julie Edwards, deputy communications director for Sen. Nelson's office, said Sen. Nelson supports the bill as passed but is disappointed the amendment didn't pass.
"This might make it difficult for lenders to offer student loans," Edwards said.
Edwards said this could prevent smaller lenders from providing the same amount of student loans.
The amendment would still have maintained the sought increase in Pell Grants proposed under both legislative measures. Those levels increase from $4,310 to $4,900 by 2008.
But others questioned the measure.
Pedro de la Torre III, issues and organizing associate manager for Campus Progress, an advocacy organization, said that the underlying economics in the amendment made Campus Progress skeptical.
"They tried to use some voodoo economics to say that even though they were cutting billions, it wouldn't affect students," he said.
Both houses will work toward compromises on the wording of the College Cost Reduction Act before presenting it to the executive branch. The Bush administration released statements in opposition of the bill shortly after it passed in the House, saying the proposed reductions in interest rates wouldn't help students until after college.
"We're very pleased and happy that the Senate made the right choice," de la Torre said. "We think the lenders are getting an exorbitant amount of subsidies at the moment without it really helping students."
