Yesterday, the Senate took up an amended version of the House-passed “Smarter Solutions for Students Act”, which reflects the compromise brokered by a bipartisan group of Senators. Renamed the “Bipartisan Student Loan Certainty Act,” the bill was approved by a vote of 81 to 18. Two amendments were offered, but both were defeated. One would have allowed the bill to sunset after two years and another would have imposed a cap of 6.8% over the life of the loan. Before the vote, the President weighed in with a Statement of Administration Policy officially expressing his support.
The bill is market-based (on the 10-year Treasury note, plus additional percentage points depending on the type of the loan) and has rate caps (8.25% for undergraduates, 9.5% for graduates, and 10.5% for PLUS loans). One of the distinctions between the original House bill and the Senate version is that the House bill would have allowed interest rates to fluctuate for the entire life of the loan, whereas the Senate version locks in the interest rate when it is first made.
The bill now heads back to the House for approval, where swift and easy passage is expected within the next week, especially now that it has bipartisan support. Chairman John Kline released a statement yesterday communicating his support of the legislation. Ranking Member George Miller also released a statement of support, solidifying the backing of House Democrats.