The Student Loan Sunshine Act

Floor Speech

THE STUDENT LOAN SUNSHINE ACT -- (Extensions of Remarks - May 14, 2007)

* Ms. McCOLLUM of Minnesota. Mr. Speaker, I rise to support the Student Loan Sunshine Act, and to congratulate Chairman MILLER and Ranking Member MCKEON for moving quickly on this critical issue.

* The recent investigation by New York Attorney General Andrew Cuomo has brought attention to serious problems in our student aid industry. While it is unfair to malign all schools and all lenders, it is clear that in large part due to lax oversight by the Department of Education, there have been many instances of actions intended for profit--rather than for improving student access to education. It is time to put an end to the conflicts of interest and corrupt practices that increase costs for students and taxpayers.

* This legislation is an important first step in improving oversight of the student loan industry and in ending inappropriate relationships between lenders and colleges and universities.

* H.R. 890 will ban loan arrangements that include benefits to higher education institutions, prohibit lenders from serving as staff in campus financial aid offices, and ban gifts from lenders to campus officials and their families. It allows the continuation of preferred lender lists but requires that these lists include at least 3 lenders and that the institutions explain their choices. This bill includes civil penalties for companies that violate the new regulations and increases the Department of Education's authority to regulate the private loan market. The Student Loan Sunshine Act also makes it clear that lenders who are transparent in their processes and advocate on behalf of students continue to be an important part of the student aid system.

* Mr. Speaker, the recent scandals in the student loan industry illustrate the Department of Education's failure to adequately regulate the student loan industry and the conflicts of interest too often noted in this administration. As the New York Times reported, Department officials were alerted to inappropriate lender subsidies in 2003 and failed to act. This week a top ED official, who formerly worked for Sallie Mae, has resigned. It has also been noted that a recently investigated lender was a top contributor to the Republican party. It is time to refocus higher education policy where it should be--on the student.

* This Congress has made access to higher education a priority. It is critical to the future of students, our communities and our Nation. With more and more students and parents relying on student loans and with student debt burden increasing, clearly we must do all we can to ensure the integrity of student aid programs. The Student Loan Sunshine Act is an important first step. I also look forward to working with Chairman MILLER and the other members of the Education and Labor Committee to pass a strong Higher Education Act Reauthorization that protects students, increases access to higher education, and improves our Nation's global competitiveness.

* I urge my colleagues to join me in supporting H.R. 890.

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