Bozeman Daily Chronicle: Tester seeks to save Perkins loans for needy Montana college students

The federal Perkins student loan program that has helped thousands of Montana college students appears to be dead, but Montana Democratic Sen. Jon Tester is trying to bring it back to life.

Tester is urging his U.S. Senate colleagues to reauthorize federal Perkins loans to help low-income students attend college.

The House voted to reauthorize the loan program before it expired Sept. 30, but in the Senate it was blocked by one key member, Sen. Lamar Alexander, a Republican from Tennessee.

Alexander, who chairs the Senate Committee on Health, Education, Labor & Pensions, is seeking to streamline the student loan system. He called the Perkins program “outdated and unnecessary.”

Tester’s office said Monday that more than 3,000 students in Montana’s University System receive Perkins loans.

“Higher education is the best way to get a good job and get ahead in life, and it shouldn’t just be available to those who can easily afford it,” Tester said in a news release. “Reauthorizing Perkins loans will ensure that more Montana students can attend college.”

At Montana State University, approximately 2,000 students out of the total 15,688 enrollment are receiving Perkins loans, said Tracy Ellig, MSU spokesman.

MSU’s Perkins loans total $3 million, or an average of $1,500 per student, Ellig said.

The Perkins loans may seem relatively small compared to more than $37 million MSU students received from all need-based student loans in 2014.

But they go to “students who have some of the greatest financial need,” Ellig said. “The $1,500 per student per year can mislead people into thinking it isn’t a big deal. But for those students receiving it, it is a very big deal.”

MSU is “quite concerned” about the impact on needy students, who are often the first in their families to attend college, he said. And the Bozeman campus has no pot of money big enough to fill a $3 million hole.

For the MSU Foundation to help, Ellig estimated it would have to raise $90 million to $100 million in endowed funds to generate enough interest each year to replace the $3 million. He added the loss would be felt at every Montana campus, not just Bozeman’s.