Governor attempting to sell loan portfolios
A proposed bill could effect the terms of many students' loan agreements.
Seth Hancock
Issue date: 3/29/06 Section: News
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Last month student body leaders from across the state, including Western Illinois University's Student Government Association President Bridget Early, sent a letter to Gov. Rod Blagojevich expressing concern for his proposal to sell the student loan portfolio to a private company.
Currently, the nonprofit Illinois Student Assistance Commission offers interest rate reductions for graduates with good payment histories and uses earnings for outreach services for students.
Student government leaders are concerned these benefits may be lost if a for-profit company takes over.
The letter sent to Blagojevich stated, "Unlike for-profit corporate lending companies whose primary motive is increasing dividends, ISAC truly cares about the students. ISAC and its lending partners have saved the students of this state more than $23 million annually."
Blagojevich's proposal also has concerned both Democrat and Republican lawmakers in Illinois. State Rep. Rich Myers (R-Colchester) introduced HB 5767 that would prevent the state from selling student loans.
Blagojevich opponents said the governor feels he does not need the legislature's approval to sell the portfolio.
Assistant Republican Leader Tim Schmitz from Geneva said, "It's my understanding that the governor believes he can do this without legislative approval.
"We have asked the attorney general to render an opinion to see if the governor is correct," Schmitz stated. "The attorney general has not taken a position on the proposal the governor has not provided any details."
Schmitz said he feels it has been common for the governor to show a lack of follow-through.
"All too often he floats an idea on a press release, provides no details to the legislature or press and then the idea disappears over time," Schmitz said.
Many Western students said they are concerned if this proposal goes through, it will negatively affect them and others from the state.
Jon Mitchell, junior human resources major, said, "It's going to raise loan prices for students at Western."
Currently, the nonprofit Illinois Student Assistance Commission offers interest rate reductions for graduates with good payment histories and uses earnings for outreach services for students.
Student government leaders are concerned these benefits may be lost if a for-profit company takes over.
The letter sent to Blagojevich stated, "Unlike for-profit corporate lending companies whose primary motive is increasing dividends, ISAC truly cares about the students. ISAC and its lending partners have saved the students of this state more than $23 million annually."
Blagojevich's proposal also has concerned both Democrat and Republican lawmakers in Illinois. State Rep. Rich Myers (R-Colchester) introduced HB 5767 that would prevent the state from selling student loans.
Blagojevich opponents said the governor feels he does not need the legislature's approval to sell the portfolio.
Assistant Republican Leader Tim Schmitz from Geneva said, "It's my understanding that the governor believes he can do this without legislative approval.
"We have asked the attorney general to render an opinion to see if the governor is correct," Schmitz stated. "The attorney general has not taken a position on the proposal the governor has not provided any details."
Schmitz said he feels it has been common for the governor to show a lack of follow-through.
"All too often he floats an idea on a press release, provides no details to the legislature or press and then the idea disappears over time," Schmitz said.
Many Western students said they are concerned if this proposal goes through, it will negatively affect them and others from the state.
Jon Mitchell, junior human resources major, said, "It's going to raise loan prices for students at Western."
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