WASHINGTON (September 17, 2009)—The U.S. House Thursday passed the biggest overhaul of college aid programs since the programs were created in the 1960s that Rep. Chet Edwards, D-Waco, says will save taxpayers billions of dollars over the next decade, but that Rep. John Carter, R-Round Rock, says could result in the loss of a thousand Central Texas jobs.

The bill, that removes private lenders from the student loan business and puts the government in charge, passed by a 253-171 vote, fulfilling an array of President Barack Obama's campaign promises, ending subsidies for private lenders, boosting Pell Grants for needy students and paying for community college reforms, among other things.

Edwards said the bill will increase Pell Grant Awards, invest in community colleges and reduce the deficit by $10 billion.

He said the measure will save taxpayers $87 billion over ten years and will reinvest $77 billion of the savings in education.

“With tuition rates skyrocketing, middle class students and their families are struggling to afford college. This is an important step toward rebuilding the American economy, and making sure young people have access to an affordable college education,” he said.

But Carter, whose district is home to two private student loan providers, says the overhaul could mean the loss of a thousand local jobs.

Texas Guaranteed Student Loan based in Round Rock employs about 660, according to the Round Rock Chamber of Commerce.

Sallie Mae, the biggest student lender, employs about 480 in Killeen.

In all, about Sallie Mae has about 8,500 employees involved in the program and probably would lay off about 30 percent of those workers although it will still have contracts to service federal loans.

“The public-private student loan program that has been in place since 1965 has provided funding for over 60 million Americans to attend college,” Carter said.

“To answer success like that by voting to destroy the system makes no sense for students or higher education.”

"In my district alone, this would directly eliminate over 1,000 jobs, not to mention all the bankers and spin-off businesses that would be negatively affected. After speaking personally with these folks, I know firsthand that many of these employees are the wives of soldiers at Ft. Hood, the last people we would want to hurt while so many of their spouses are deployed overseas protecting our country,” Carter said.

The measure goes next to the Senate, where its fate is a little less certain.

More Congressional Information From “Thomas”

U.S. House Web Site

Rep. Chet Edwards’ House Web Site

Rep. John Carter’s House Web Site