The American Student Association of Community Colleges adopted a strong stance in March 2015 by selecting as one of its three top legislative priorities allowing students to use pre-tax dollars to repay student loans. Student loan debt is becoming a growing concern. It is currently over 1.3 trillion and growing at over $3000 per second; second only to home mortgages as a portion of individual debt. Obama recently announced an initiative to have the first two years of community college free. That is a great idea, but what about those of us who have already incurred mounds of student loan debt. What is being done to help relieve the stress of having this debt? ASACC and its member colleges are leading the way through their proposal. One of ASACC’s founding colleges, Milwaukee Area Technical College (MATC), sponsored a resolution which spawned the idea for this to become a national issue. In the 2015 ASACC Priorities, which was delivered to every Congressional Office as well as members of the Administration, it states:
College graduates face an unprecedented financial crisis. Current estimates place student loan debt at an astonishing $1.3 trillion dollars. ASACC urges Congress to address this problem by simplifying and providing a way for students to reduce the burden of this debt. ASACC believes one way to do this is to by allowing students to pay their student loan payments through payroll deduction with pre-tax dollars. ASACC is seeking sponsors for legislation that would make this proposal a reality for those seeking to reduce this debt so they can start contributing and participating in other sectors of the economy.
Students and graduates from across the nation want to be heard, one student eloquently stated, “We further our education to help better the nation, but in return get held back by student loan debt.” Luckily a few students from Milwaukee Area Technical College have heard their cries and began to do something about it. ASACC has asked for legislation to change the tax code to allow us to repay our student loans using “pretax” dollars. In other words, student loan payments could be taken directly off of your paycheck before the taxes are taken out. That can benefit us in several ways. Not only does it lower our taxable income, but it will pay off our student loans in a timely fashion. It will help eliminate the rising default rate, and give us a little more money in our pocket; which will in turn help the local economy grow and flourish.
During the past 7 months, the American Student Association of Community Colleges (ASACC) has made giant strides towards this goal. They have helped to get this idea in front of the legislators on Capitol Hill and are helping to spread the word nationwide. The next steps are to get the Government Accountability Office(GAO) to complete a cost study and find sponsors for legislation in both the House and Senate. We look forward to continuing the discussion surrounding this important topic regarding students with Congress and the Department of Education.