Representative Paul Evans (D-Independence) introduced HB 2780, which creates the Guaranteed Opportunity Program to provide college funding by 2043. Under this bill, the State of Oregon would have 20 years to implement an in-state post-secondary education, training and workforce development loan program to qualified individuals. In exchange for the upfront payment of tuition and fees, textbooks, and housing costs by the State, a degree-seeking student would commit to repaying a set percentage of their post-education income to the program.

HB 2780 introduces a student and institutional funding system where high school graduates or resident taxpaying students attend higher education in a degree program and the state postpones the payment of costs of attendance, including tuition, housing, textbooks and fees, in exchange for payment of a set percentage of future salary. The percentage is based on the type of degree ranging from two to five percent of adjusted gross income with a payment period from three month after completing the degree to the later of age 65 or retirement.

Every two years the State Workforce and Talent Development Board will analyze the workforce and make adjustments to the percentages of future income that participants are required to pay. It places the cost of an education on the recipient and the amount of loan forgiveness at age 65 is based on the income level of the recipient. The bill allows the commission to engage a collection agency if failure to make payments occurs.

A Guaranteed Opportunity Program Implementation Fund is administered by the commission and funded by the legislature, the sale of bonds, and the repayment by participants. The cost to the state would be administration of the program and any unrepaid amounts at the participants retirement or age 65, whichever is later. The percentage of repayment is based on the level of degree obtain, not the amount of income, so repayment amounts will vary.

The Commission pointed out in testimony that the program is similar to a small pilot program proposed by the Office of Student Access and Completion 10 years ago. The complexity of this legislation requires that analysis be revisited to be able to provide information about potential program structures and costs. In addition to structures or costs, there is the question of repayment of individuals out-of-state or out-of-country, as required by the bill.

A D V E R T I S E M E N T

A D V E R T I S E M E N T

Representative Evans states, “While 17 states have alternative student loan programs, the Guaranteed Opportunity Program is the first to have a fixed repayment agreement and term, which is desperately needed to balance the responsibility of repayment against the needs of the economy, the State and society at large. We can provide a way forward that works for everyone by implementing the Guaranteed Opportunity Program.”

However, the Commission suggests the bill is putting the cart before the horse. HECC recommends that, prior to convening a large public task force, or setting lifetime repayment rates and time periods in statute, that an actuarial analysis be conducted to determine potential program costs and returns based on a number of variables, including the repayment rates, enrollment projections, projected higher education costs, and wages. In particular, there may be a self-selection effect under the current payment details, where projected higher income earners do not enroll in the program, making the program more costly on a per capita basis. The bill calls for a task force to perform these functions without an actuarial analysis.

The program may not eliminate the life-time of education debt, but Evans claims the Guaranteed Opportunity Program ensures access to higher education for Oregon’s students. “We must support our economic and workforce needs while making it possible for them to buy homes and raise families." He contends it will create opportunities for non-traditional Oregonian students to access fair financing, balanced and simple repayment, and economic opportunities that are often attached to post-secondary education, training, and workforce development. This would make it possible for parents and mid-career professionals to go back to school for first time or additional academic programs.


--Donna Bleiler

Post Date: 2023-01-27 11:44:30

Last Update: 2023-01-27 17:46:24