Proposal looks to increase opportunities with less student debt
SALEM, Ore. – On the Capitol steps Thursday, supporters of a plan to dramatically increase the money the state spends on college scholarships held a sort of starving student rally.
The rally offered free pizza and a log to post how much student loan debt is waiting for college graduates. Portland Timbers mascot "Timber Joey" fired up his chainsaw and sliced through the log to symbolically cut student debt.
The Oregon Opportunity initiative calls for borrowing half a billion dollars then reinvesting the money in the stock market.
Right now is one of the best times in history to borrow money because interest rates are low. So the plan from state Treasurer Ted Wheeler is to borrow $500 million now, lock in the interest rate, and then invest at a profit in order to benefit students in financial need.
"I already have $25,000 in debt," said Portland Community College student Wendy Hemken.
With her 7-year-old Kimberly by her side, Hemken told a committee of lawmakers her daughter’s future college plans are in doubt.
"I don't want my education to mean that my children are not going to be able to go to school," she said.
Right now roughly four out of five low and middle income students who apply and qualify for Oregon's Opportunity Grant don't receive a dime.
"It is absolutely unacceptable for such young people to face such great challenges when it comes to being able to attend college," West Linn High School student Taylor Harding told lawmakers.
Enter Wheeler and his Oregon Opportunity initiative.
"It creates a permanent growing financial vehicle dedicated toward student aid," he told lawmakers during his testimony.
His plan takes advantage of low interest rates to borrow $500 million now and invest more than $400 million over the next 30 years with the expectation that the money will nearly double by 2044.
"It's not just for now, it's for all the way down the line," Hemken said during an interview.
And for her daughter, Kimberly, that means a greater shot at being who she wants to be.
"I decided that I would be a doctor that would go to outer space," the 7-year-old said.
The plan to borrow money for higher education grants needs to be approved not only by lawmakers, but eventually by voters as well because it calls for a change to the state Constitution, creating the permanent Student Opportunity Fund.