When President Obama puts pen to paper today on the final version of a health care overhaul bill, he'll also be changing the course of the nation's student loan program.
Along with the adjustments Congress made to the health care aspects of the bill was a revamping of the way student loans are administered. The President will be breaking down exactly just what that will mean for college students when he speaks at Northern Virginia Community College's Alexandria campus at 11:05am [foxlivestream].
Starting July 1st, when the government issues student loans, it will bypass the banks who have traditionally provided them, and directly target borrowers.
A White House press release spells it out this way, "[A]ll new federal student loans will be direct loans, delivered and collected by private companies under performance-based contracts with the Department of Education. According to the non-partisan Congressional Budget Office, ending these wasteful subsidies will free up nearly $68 billion for college affordability and deficit reduction over the next 11 years."
But some in the President's own party say eliminating the middle man also equals eliminating jobs.
But the President's focus today will be more about what the bill does than what it does not.
He will also talk about the provision's less controversial expansion of Pell Grants, as well as supporting historically black and minority institutions and caps on student loan repayments.
According to the White House, "New borrowers who assume loans after July 1, 2014, will be able to cap their student loan repayments at 10 percent of their discretionary income and, if they keep up with their payments over time, will have the balance forgiven after 20 years."
Vice President Biden's wife, Dr. Jill Biden, is a teacher at NOVA and will introduce the President.
Mr. Obama will announce that he has asked Dr. Biden to host a White House summit on community colleges this fall, with the purpose of "educating our way to a better economy," says a senior administration official.
A senior administration official says today's remarks are targeted to people around the country who don't know what the plan is all about.