Grassley praises effort by Horizons on student loan debt

CEDAR RAPIDS - He couldn't promise them more funding, but Sen. Chuck Grassley endorsed a Cedar Rapids-based family services organization for its efforts to deal with college student debt.

Grassley told employees and board members at Horizons: a Family Services Alliance that he shares their concerns with the growing problem of student loan debt and increases in defaults.

His 'Know Before You Owe” legislation dovetails with the efforts of Horizons, the Iowa Republican said after financial wellness director Terry Bergen told him that counseling students and former students with debt issues is a growing part of his work. Student loan debt has exceeded $1 trillion dollars nationwide, surpassing credit card debt.

'They don't know what they're getting into until they're in over their head,” Bergen told Grassley. They don't realize until it's too late.”

Student loan debt was one of several topics Grassley addressed in answering questions from employees and board members of the organization that provides nutrition and wellness programs such as Meals on Wheels, transportation services, mental health program and community outreach such as Headstart.

Grassley said he's not likely to vote to raise the federal minimum wage at this time, but didn't oppose states taking action that reflects their cost of living.

Asked about Johnson County raising the minimum wage there, Grassley said 'the cost of living in Iowa City is probably higher than in Butler County where I live.”

He doesn't anticipate cuts to food stamps - the Supplemental Nutrition Assistance Programs, said he wants to protect crime victim assistance funds, which is another service offered by Horizons, and talked about his passion for protecting federal government whistleblowers 'whose only crime is the truth.”

Addressing student loan debt, Grassley wants students and their families to have more information about how much they need to borrow to finance a college degree as well as the cost of repaying the loan. They also need to know whether the degree they are seeking offers the potential to earn what they'll need to repay their loans.

'They have every incentive to borrow as much as they can” rather than as little as they'll need to meet their needs, Grassley said. Former University of Iowa President Sally Mason told him that is students borrowed only what they need to earn a degree student debt loads would fall about $13,000 from the $30,000 average for Iowa college students.

He also praised the University of Northern Iowa - his alma mater - for lowering the average debt load of its graduates by about $3,000 through a voluntary financial counseling program. Iowa State University and others have similar programs, he said.

Bergen said Horizons has a relationship with UI to offer financial counseling.

'Hopefully, the need for my legislation will be obliterated by people waking up to the problem,” Grassley said.