Republican and Democratic leaders of the education committee in the U.S. House of Representatives clashed on Wednesday over whether legislation that GOP lawmakers introduced last week to renew the Higher Education Act would do enough to help financially needy students gain access to college.

At issue was the decision by the committee's Republican leadership to keep the bill (HR 4283), known as the College Access and Opportunity Act, "cost neutral," meaning that any money added to one federal student-aid program in the bill would have to be offset by cuts to another such program.

At a hearing of the committee, its chairman, Rep. John A. Boehner of Ohio, said that with the large federal budget deficit, he had no choice but to act responsibly and "make hard decisions."

Despite the restriction on costs, he said he was confident that the bill would "expand access to higher education for millions of low- and middle-income students." It would do that in part, he said, by taking billions of dollars that the government provides in subsidies to borrowers who are long out of college and redirecting that money to help current and future students.

The bill would, for example, raise the amount of money that first- and second-year students may borrow from the federal loan programs, and would reduce the origination fees that students must pay to obtain their loans. To pay for those proposals, the lawmakers included a provision in the bill that would make the loan-consolidation program less appealing to borrowers (The Chronicle, May 7).

"I firmly believe current and future students should be our No. 1 priority in distributing federal higher-education aid," Mr. Boehner said.

But the committee's Democratic leaders said that the panel should not have to make such trade-offs. If the Republicans cared as much about education as they do about tax cuts and other priorities, the Democratic lawmakers said, they would be able to help current and future students without harming hundreds of thousands of existing borrowers who are buried in debt.

"I find it rather fascinating that when it comes to education, we're in a budget-neutral situation," said Rep. George Miller of California, the top Democrat on the panel. "We're not in a budget-neutral situation with the military budget, the agriculture budget, and the transportation budget.

"So they have obviously decided that it is a higher priority to find money for tax cuts and for all these other purposes," Mr. Miller continued, "but it's not a high priority of the Republican leadership here to find money for the education of America's young people."

Pell Grants

Mr. Miller and other Democrats on the committee also took the Republican lawmakers to task for proposing to keep the authorized level for the maximum Pell Grant, set by Congress in 1998, at $5,800 over the next six years.

The maximum Pell Grant that is authorized in the Higher Education Act for each fiscal year is mostly symbolic because the actual maximum award is set annually in appropriations bills. For example, the maximum grant is now $4,050, even though it is authorized to be $5,800.

Republicans on the committee said that it is unnecessary to raise the authorized level since the appropriations have not come close to reaching the current authorized maximum. Mr. Boehner said that increasing the maximum grant in the bill would be dishonest because Congress would not be able to finance it.

But Mr. Miller said that raising the level would show that Congress is committed to the program. "We should be saying [that] this is what the country should be doing," he said. "That's why we are policy makers."

Some of the college leaders and advocates for students who testified at Wednesday's hearing agreed.

"You ought to set the bar so it continues to move upward," said Charles B. Reed, chancellor of the California State University System.

Democratic Divisions

While Democratic lawmakers on the committee were unanimous in criticizing the Republicans as stingy, they were divided over the bill's proposed changes to the loan-consolidation program.

Under the bill, borrowers who seek consolidation loans would no longer be able to lock in fixed interest rates for up to 30 years, as they are able to do now. Instead, the borrowers would be charged the same rate as all other student-loan recipients are charged in a given year. Currently, that rate varies from year to year, based on market conditions, and is capped at 8.25 percent.

The panel's Democratic leaders oppose the plan. They cite a report by the nonpartisan Congressional Research Service that states that a switch to a variable interest rate could more than double the interest paid by the average borrower over the life of his or her loan.

But a Democrat on the committee -- Rep. Robert E. Andrews of New Jersey -- disagrees with his colleagues. He has introduced his own bill (HR 4102), which would replace the fixed rate with a variable rate.

While his bill is similar to Mr. Boehner's, it would lower the interest-rate cap for borrowers with heavy debt burdens. Those borrowers who are putting at least 8 percent of their annual income into loan repayment would get a variable-rate loan with a lower cap than 8.25 percent (The Chronicle, April 30).

Mr. Andrews said he believes his bill could bring together Democrats and Republicans who are seeking a serious way to deal with the issue. "I have never been involved in a legislative process that doesn't involve compromise," Mr. Andrews said at the hearing.

Nine of the 21 other Democrats on the committee have agreed to cosponsor Mr. Andrews's bill. But there are divisions on the Republican side as well. At least a half-dozen Republicans oppose shifting to a variable rate in consolidation, Congressional observers say.

At the hearing, Mr. Boehner tried to draw support to the consolidation proposal in his bill. He presented a new report by the Congressional Research Service that he said shows that variable-rate consolidation loans tend to cost less for borrowers.

The analysis found, he said, that borrowers taking out consolidation loans in 13 of the 18 years since 1986, when Congress created the refinancing program, would have paid less over the life of their loans under a variable rate than a fixed one.

The panel's Democratic leaders did not comment on the study, as they first learned about it at the hearing.