by Matt BergerU-WIRE Washington Bureau
President Clinton will ask the U.S. Congress to make college tuition tax deductible as part of his 2001 budget proposal.
The president’s announcement came shortly before his final State of the Union Address Thursday.
The proposal calls for $30 billion to be invested in the College Opportunity Tax Cut, which would provide up to $2,800 in tax relief for a student a year, once the program is fully functional in 2003.
If implemented it would give students and their families the choice of either a tax deduction or a 28 percent credit for tuition, fees and other expenses. The plan would cover up to $5,000 in expenses for the next two years and $10,000 after that.
This has never been done before, Clinton said at an announcement ceremony in the Old Executive Office Building. We will really be able to say anyone who wants to go to college can go.
Clinton, who also mentioned his proposal during his State of the Union Address Thursday night, was joined by First Lady Hillary Rodham Clinton and Sen. Charles Schumer (D-N.Y.), who said the program gives students a real fighting chance.
A college education is a necessity for the economic survival of every family today, but it is priced beyond the realm of nearly anyone, Schumer said.
The proposed tax credit would be more widely available than previous education credits. The maximum income necessary for eligibility in the program will be $60,000 for individuals and $120,000 for married tax filers. Those numbers are higher than the current education tax credits.
The latest proposal comes after recent increases to the Pell grants and the start of the Lifetime Learning tax credits in 1997. Education Secretary Richard Riley told the audience, which included higher education administrators from around the country, that schools have been supportive of the new scholarship opportunities.
Colleges like yours have worked to keep costs down, and they welcomed the tax credits for their students in a very positive way, Riley said.
The president also announced $1 billion to help students afford to stay in school, through additions to the Pell grants and work-study programs, in addition to several new initiatives. Pell grants would be raised to a maximum of $3,500 a student each year.
Minority students would benefit from a new proposal that would give students at minority-serving institutions two degrees – one from the school and one from a partner institution in a field in which minorities are underrepresented.
In addition, $400 million has been proposed to get students in middle and high schools to plan for college and understand higher education is affordable to them, through the TRIO program, a series of federal educational opportunity programs.
We want to encourage more students at an earlier age to give them a sense they can go to college and earn a degree, Clinton said.
A similar tax deduction proposal, sponsored by Schumer and Sen. Olympia Snowe (R-Maine), received some bipartisan support last year but did not pass Congress. Riley said he believed this program will be passed by the Republican-controlled legislature, as part of Clinton’s balanced budget proposal.
Rep. Bill Goodling (R-Pa.), chairman of the House Education and the Workforce Committee, said he believes the Pell grant program should be the government’s highest priority for higher education spending and should be funded to the maximum extent allowed in the budget.
The president’s commitment to spend more money on Pell grants, the TRIO program and work study is a step in the right direction, Goodling said in a press release. I am disappointed, however, that the President still sees the need to create new federal programs and new bureaucracies for proposals when existing programs could be used.
