Connecticut Senate Bill SB00018

Connecticut 2020 Regular Session

• Introduced: 2/6/20
• Refer: 2/6/20
• Report Pass: 3/10/20

Caption

An Act Requiring The Connecticut Higher Education Supplemental Loan Authority To Establish A Student Loan Subsidy Program.

Impact

The enactment of SB00018 is expected to positively influence the landscape of student loans in Connecticut. It empowers the state to issue bonds up to $15 million for financing the subsidy program. The bill allows adjustments to the criteria for applicant eligibility and the structure of the loan terms, ensuring flexibility in responding to the economic landscape and the needs of residents. This initiative aims to make higher education more accessible for working individuals, potentially leading to an increase in the local workforce's skill level and economic productivity.

Summary

SB00018 establishes a Student Loan Subsidy Program aimed at reducing interest rates on loans administered by the Connecticut Higher Education Supplemental Loan Authority. The initiative is designed to support individuals employed in the state who commit to live there for at least five years. By providing financial assistance through subsidized loans, the bill seeks to alleviate the burden of student debt, thereby promoting higher education and retention of skilled workers in Connecticut. The program will be funded through a newly established nonlapsing account, which will hold appropriated state funds and proceeds from bond sales.

Contention

While the intention behind SB00018 is largely seen as beneficial, there may be concerns surrounding the long-term sustainability of the subsidy program, particularly regarding the state's obligation in managing the bond issuance. Critics may question whether the financing model adequately addresses the need for a broad-based solution to the rising cost of education, as not all students might qualify for the loan subsidies. Furthermore, the successful administration of the program would depend heavily on the guidelines established by the Secretary of the Office of Policy and Management, which could lead to debate about the program's effectiveness and reach.