Merkley Unveils Legislation Making College More Affordable for Middle-Class Students

Merkley Unveils Legislation Making College More Affordable for Middle-Class Students

Bill is modeled after Oregon’s “Pay It Forward, Pay It Back” Proposal

Eugene, OR – Calling an affordable path to college a key pillar for a strong middle class, Oregon’s Senator Jeff Merkley today unveiled legislation that would create a new model for college financing intended to guarantee affordability. Merkley’s plan is based on and complements Oregon’s legislation that was passed during the 2013 legislative session and arose from a Portland State University student-led project.

The bill would replace federal loans and the debts that accompany them with up-front payment of college costs in exchange for repayment based on the graduate’s income. 


“Our economy depends on a strong and growing middle class, and more than ever the road to middle class success runs through college,” said Merkley, appearing at the U of O. “With students starting their working lives burdened by tens of thousands of dollars in debt, it's clear the old models aren't working anymore. We need bold new initiatives that put opportunity for middle class Oregonians at the heart of our economy." 

The “Pay It Forward” Guaranteed College Affordability Act of 2013 would allow some or all of students’ upfront costs for a two- or four-year college to be covered by program funds. Then upon graduation, students contribute a percentage of adjusted gross income (AGI) for a fixed number of years back into the fund. Put simply, students would draw from program funds while they are in school, and pay into—or pay it forward—when they graduate.

  • The bill would establish an alternative to undergraduate federal Direct Loans, providing Federal funding to states that agree to pilot a Pay It Forward model up to the current Stafford loan limits for each student that participates.
  • States would select schools to participate in the pilot.  Students who attend those schools could choose to enroll in the program. 
  • Rather than forcing students to take on expensive debt obligations with fluctuating interest rates adding an uncertain ability to repay, this legislation would open up a new model to guarantee students’ ability to afford college repayment based on their income after graduation. 
  • To help students transition from school to employment, an individual’s contributions would be deferred until their income rises to a level that payments become affordable.

"The high cost of college and the growing burden of student debt are pricing students out of college and hurting our economy,” said Nathan Hunt, student at Portland State University. “We cannot afford to wait. As a student with over $25,000 in student debt, I am thrilled to see Senator Merkley taking action to address the student debt crisis and make education accessible for students."

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