Fogel: Exempt non profit VSAC from reform bill

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(Host) UVM president Dan Fogel is urging Congress to exempt VSAC, the Vermont Student Assistance Corporation, from proposed legislation that’s designed to reform student loan programs throughout the country.

Fogel says non profit organizations, like VSAC, shouldn’t be the target of the reform movement.

VPR’s Bob Kinzel reports.

(Kinzel) Legislation is working its way through Congress that would have a big impact on the higher education student loan industry.

The bill, which has been approved by the U.S. House, expands the size of federal grants and loans that are available to individual students.  It also simplifies the application process for many of these programs.

The plan is paid for, in part, by the savings that will be achieved by converting virtually all student loan programs, which are often run by for-profit financial institutions, to a new federal direct loan program.

In Vermont, many of these loans are made by VSAC, a non profit organization that also offers college counseling programs.

Speaking on VPR’s Vermont Edition, UVM President Dan Fogel said he hoped Congress would allow non profit groups like VSAC to stay in the college loan business:

(Fogel) "The reason is, of course, the wonderful work that VSAC does in outreach to students and families around Vermont in terms of college readiness, in terms of raising the aspirational horizons of students in their very early stages of thinking about college…that’s very important for pulling up a lot of Vermont students, especially our first generation collegians."

(Kinzel) Fogel says VSAC will have a very hard time finding the financial resources to pay for its outreach programs if Congress takes away its authority to make college loans:

(Fogel) "The loan programs have been the source of funds for VSAC’s outreach programs. They have focused their funds on the outreach to Vermonters. So if they lose that source of funds, to continue those programs they will have to have alternate sources of funds. That will be a challenge."

(Kinzel) Vermont’s Congressional delegation is working to include an exemption for non profit lending organizations, like VSAC, in the final version of the bill.

For VPR News I’m Bob Kinzel in Montpelier.

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