Yesterday, the House Education and Labor Committee passed HR 3221, Student Aid and Fiscal Responsibility Act of 2009, which was introduced last week. The legislation eliminates the Federal Family Education Loan (FFEL) program and utilizes the $87 billion saved to fund increased Pell grant levels for students (indexed to inflation plus 1%, but subject to appropriations), as well as a number of other K-12/community college/ 4 year higher education programs. A provision of the legislation, strongly opposed by the higher education community, to eliminate the graduate and professional student loan subsify was stripped from the legislation.
The Senate is expected to consider its own version of the legislation after the August congressional recess.