SPRINGFIELD (AP) – State lawmakers on Tuesday advanced a plan to explore if Illinois could ease students’ college payments by using a plan similar to efforts across the country to reign in mounting student loan debt.
A Senate committee voted 9-0 to approve a plan to study a program that could allow students to receive interest-free college loans and pay them back based on their post-graduation incomes. Similar “Pay It Forward, Pay It Back” efforts are underway in states such as Oregon, Pennsylvania and Michigan.
State Sen. Mike Frerichs, a Champaign Democrat, is sponsoring the legislation because he says an educated workforce is critical to the state economy, but student debt is creating difficulties.
“College affordability is a real issue for our state, and it’s a drag on our economy,” Frerichs said. “We have student debt in this country now exceeding a trillion dollars, higher than credit card debt. It’s clear we have to do something.”
But it’s unclear how Illinois could pay for such a program in an expectedly tight budget year. The state faces a $1.6 billion drop in revenues if legislators don’t extend an income tax hike set to roll back in 2015.
A state Board of Higher Education spokesman said universities are concerned they couldn’t afford the upfront costs of such a program.
“We definitely understand what the Legislature is doing from an affordability perspective,” agency spokesman Jonathan Lackland said. “We’re all going to have a discussion to figure out how best to do it and to not jump into a plan that, to be honest with you, has not been fully vetted across the country.”
The House approved the measure 111-0 in March. It now moves to the full Senate for consideration.