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Special Order of Business - Supporting Private Student Loan Reform

SUPPORTING PRIVATE STUDENT LOAN REFORM
Submitted by: Local 6300, the Graduate Employees’ Organization at the
University of Illinois, Urbana-Champaign


WHEREAS, the public higher education system in the United States, from community colleges to flagship research universities, is a public good that plays a key role in everything from providing new skills and retraining opportunities for workers to training future professionals in fields like medicine, engineering, and education to producing groundbreaking research which has improved the lives of and provided economic opportunities for countless Americans; and

WHEREAS, student loan debt in the United States now totals more than $1 trillion, surpassing credit card debt; and

WHEREAS, the overall growth in student debt is unsustainable, and the growth of private student loans is even more concerning; and

WHEREAS, according to the Project on Student Debt’s 2011 survey,  Illinois ranks 15th in the nation, with an average debt of $26,470 for undergraduate students graduating from public and private non-profit institutions; and

WHEREAS, according to the Project on Student Debt’s 2011 survey, approximately 64 percent of Illinois undergraduate students graduate with loan debt; and

WHEREAS, massive and ongoing state disinvestment in our institutions of public higher education has shifted the burden for the financing of higher education onto the backs of students and their families through skyrocketing tuition and fees; and

WHEREAS, despite the increases in tuition, public colleges and universities are cutting academic programs, are slashing student support services crucial to student success, and are increasingly relying upon a contingent academic workforce; and

WHEREAS, federal student loans have fixed interest rates and offer an array of consumer protections and favorable terms. Private student loans, which resemble credit cards rather than financial aid, often have uncapped variable interest rates (which have spiked as high as 18 percent in recent years), hefty origination fees, and few, if any, consumer protections, and they are ineligible for federal forgiveness, cancellation, bankruptcy, and repayment programs; and

WHEREAS, student loans should work as a safety net that allows people to get an education with the assurance that, should their finances be strained by layoffs, accidents, or other unforeseen life events, they will be protected; and

WHEREAS, two-thirds of private loan borrowers, including those who took out both private and federal loans, said that they did not understand the major differences between private and federal options, and as a result, a majority of undergraduate students who borrowed private student loans in 2007–2008 did so without first exhausting their eligibility for safer, cheaper federal loans; and

WHEREAS, Increasing numbers of students, especially low-income students and people of color, see their educational opportunities curtailed by the specter of long-term debt; and

WHEREAS, President Obama has called for an aggressive strategy to address student debt relief; and

WHEREAS, Public Service Loan Forgiveness, Income-Based Repayment, and other loan repayment assistance programs need to be supported at both the state and federal level to help address this crisis; therefore be it

RESOLVED, that the Illinois Federation of Teachers (IFT) will support legislation and policies at the state and federal level that will help to reduce the burden of the student; and be it further

RESOLVED, that the IFT will support legislation and policies at the federal and state level which increase funding and access to needs-based aid and simplify the process for applying for this aid; and be it finally

RESOLVED, that the IFT will support state legislation and policies which will increase public investment in instruction and student support services at public colleges and universities and decrease the financial burden for students and their families, rather than restructure and prolong the burden, as policies such as Pay It Forward may do.

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