Democrats are pushing to fund a program that would give Washington high school graduates access to state student loans at a one percent interest rate.
A program was created in 2009 to issue low-interest educational loans, but the program was never funded.
House Bill 1542’s sponsor Rep. Pat Sullivan (D-Covington) raised concerns about students having to take out high-interest loans to get through school and graduating with mounting debt.
“We want students to graduate with as little debt as possible,” said Sullivan, who is the majority leader.
According to the Consumer Financial Protection Bureau’s most recent report on student debt, Washingtonians owed $24.4 billion in student loan payments at the end of 2016.
HB 1542 would cost universities more than $1.7 million to implement, which would be funded by an increase in the Real Estate Excise Tax on properties that sell for more than $1 million. The tax on million dollar properties would go from 1.28 percent to 1.5 percent.
The money from this tax increase would go into the Washington Student Loan Account. The tax on properties that sell for $1 million or less will remain at 1.28 percent.
Tonya Drake, chancellor of Western Governors University in Washington, asked legislators to amend the bill and make the program available to all Washington residents, not just graduates of a Washington high school.
“We believe that all of Washington students and residents should have equal opportunity for these low-interest loans,” Drake said.
Gov. Jay Inslee’s proposed budget also aims to fully fund the Washington College Promise, which guarantees financial aid for all students, and to increase funding for Career Connected Washington, a program created to connect high school students with good paying jobs.
HB 1542 is scheduled for an executive session on Tuesday, Feb. 12.