FOR IMMEDIATE RELEASE
Sen. Kirsten Gillibrand has introduced the Federal Student Loan Refinancing Act, a bill that would allow borrowers to refinance their student loan debt at a lower interest rate. Gillibrand reasons that since business owners and homeowners are able to refinance, why can’t student loan holders?
“I urge President Obama to make refinancing student loans a top priority,” Gillibrand told the Albany Times Union. “Our young people should be able to refinance in the same way that our businesses and homeowners do. We must strengthen our middle-class families instead of forcing New Yorkers deeper into debt.”
The bill would enable individuals with student loan interest over 4% to refinance at a fixed rate of 4%. It’s estimated that this legislation would lower interest rates of 9 out of 10 federal student loans nationwide, saving nearly 37 million borrowers billions of dollars in annual interest payments. Most college graduates leave school with more than $25,000 in student loan debt. Part of the issue is that annual tuition increases more than the rate of inflation.
At the same time students are paying more for a college degree, those who are teaching them are less likely to be tenured professors. Adjuncts, also known as contingent faculty, number at least 1 million and now comprise 75% of college and university faculty. They teach on a contract basis, often booked one semester at a time.
Adjunct faculty are paid, on average, $3,000 per class per semester, and they owe the same crushing interest rates on their student loans as undergraduates. If adjunct faculty are fortunate enough to secure eight teaching assignments per year, their annual salary is then $24,000, barely enough to get by let alone pay off student loans.
“SEIU Local 200United stands with Senator Gillibrand on this important issue,” said Union President Scott Phillipson. “For many of our members the dream of a college education for themselves or for their children has drifted out of reach. And for those who complete their education, their choices are limited by concern over the enormous debt that follows a college education. This is even more troubling for adjunct instructors who face even more massive student loan debt and then find themselves in an often troubling situation where there are low wages and no guarantees of job security from semester to semester.
“This is why we have mounted Adjunct Action, an effort to bring these adjuncts under the union umbrella so that they can stand with our more than 3,000 members in higher education and our 15,000 members statewide to build power for all workers while improving their standard of living.”