HR1194 94TH GENERAL ASSEMBLY

HR1194 LRB094 20283 NHT 58293 r

HOUSE RESOLUTION

WHEREAS, Postsecondary education is increasingly essential for success in the modern economy; and

WHEREAS, Affordability of a college degree is a growing concern to students, families, and State policymakers; and

WHEREAS, The Illinois Student Assistance Commission's mission statement affirms that the purpose of the Commission is "to benefit society by enabling individuals to develop to their fullest potential through access to quality education"; and

WHEREAS, The Illinois Student Assistance Commission's secondary market, the Illinois Designated Account Purchase Program (IDAPP), was created to ensure the continued availability of educational loan capital; through its purchase activity, IDAPP provides lenders with the liquidity they need to make additional loans, and, through its Community Educational Loan Partnership activity, IDAPP also acts as a lender referral service, ensuring that access to educational loans exists in all communities and areas of this State; and

WHEREAS, The Illinois Student Assistance Commission operates as a national guarantor, consistently ranking among the top ten guaranty agencies in the country in total dollars guaranteed; and

WHEREAS, Since 1966, the Illinois Student Assistance Commission has guaranteed over $9.4 billion in federally reinsured Federal Family Education Loan Program loans for qualified students and parents; and

WHEREAS, Revenues from the IDAPP help allow the Illinois Student Assistance Commission to fund a number of programs and services, including financial aid workshops, 1-800 help lines, 1.5 million informational pamphlets annually, outreach services to over 500,000 individuals annually, informational websites, credit-based alternative loan programs, low interest loans, interest rate reduction programs, financial aid grants, financial aid scholarships, College Illinois!, support services for families and students, default prevention services, and training and technical assistance; and

WHEREAS, Without a guaranteed revenue stream from the IDAPP, other services offered through the Illinois Student Assistance Commission may potentially lose their funding; and

WHEREAS, The Illinois Student Assistance Commission has proposed selling part or all of its Illinois Designated Account Purchase Program to a private, for-profit entity; and

WHEREAS, The Illinois Student Assistance Commission offers an array of low interest educational loan programs with reasonable and manageable repayment terms; and

WHEREAS, The Illinois Designated Account Purchase Program serves an estimated 335,000 student loan borrowers, with an estimated value of $3.8 billion in loans; and

WHEREAS, From Fiscal Year 2000 to Fiscal Year 2005, the number of borrowers who benefited from the IDAPP has increased by 54%; and

WHEREAS, Student loans are now the single biggest source of financial aid for students, and the average debt for an ISAC-backed Stafford Loan recipient has increased by 28% from Fiscal Year 2000 to Fiscal Year 2005; and

WHEREAS, Student loan borrowers use loans as a necessary means to acquire access to a higher education; and

WHEREAS, Other states have privatized programs equivalent to the Illinois Designated Account Purchase Program, and, according to published news reports, student loan borrowers in Ohio and Maine experienced negative consequences; and

WHEREAS, According to the National Center for Public Policy and Higher Education, 200,000 individuals nationally do not pursue a higher education every year due to costs; and

WHEREAS, We, the House of Representatives, support affordability and accessibility in post-secondary education and want to maintain services that help students acquire a post-secondary education; therefore, be it

RESOLVED, BY THE HOUSE OF REPRESENTATIVES OF THE NINETY-FOURTH GENERAL ASSEMBLY OF THE STATE OF ILLINOIS, that the Commission on Government Forecasting and Accountability, in conjunction with the Board of Higher Education, publish a report to determine the potential effects to student loan borrowers in the Illinois Designated Account Purchase Program if the Illinois Designated Account Purchase Program were to be sold to a for-profit entity; and be it further

RESOLVED, That the report shall suggest options on how to ensure affordability and accessibility for student loan borrowers in the case that the loans are privatized; and be it further

RESOLVED, That the report shall suggest options on how the State will allocate resources to maintain or improve the quantity of students served and the quality of the Illinois Student Assistance Commission's student service programs in the event that revenue from the Illinois Designated Account Purchase Program is privatized; and be it further

RESOLVED, That the Commission on Government Forecasting and Accountability and the Board of Higher Education shall release their report no later than July 1, 2006; and be it further

RESOLVED, That suitable copies of the report from the Commission on Government Forecasting and Accountability and the Board of Higher Education, upon release, shall be delivered to all legislative members and executive officers; and be it further

RESOLVED, That no further action shall be taken by the Illinois Student Assistance Commission to sell the Illinois Designated Account Purchase Program until May 31, 2007; and be it further

RESOLVED, That suitable copies of this resolution be delivered to the Illinois Student Assistance Commission, the Commission on Government Forecasting and Accountability, and the Board of Higher Education.