A Lowcountry lawmaker has pre-filed legislation that would create a pilot program exploring a new way for students to repay college loans.
Dubbed the Palmetto Pay Forward, Pay Back Pilot Program in H.4144, the bill would set up a pilot program where S.C. students can enroll in a state institution without paying fees, in exchange for signing a legally binding contract that they would pay a certain percentage of their salary post graduation for a certain number of years.
Rep. Chip Limehouse, R-Charleston, said the bill gives an alternative to traditional higher education funding.
“The Palmetto Pay it Forward bill is a new way of looking at paying off education for South Carolinians who want to go to college. In the past we’ve had them take out onerous loans and graduate with no job in sight. it just hasn’t worked out. This is just an alternative path,” he said. “We tell everyone they need higher education and we force them to take out a loan. The loan and the interest pile up. We don’t always have a job ready for that person when he or she graduates college and we create a bad situation for those young folks.”
The idea will be to take the pilot program forward and enact the program into statewide law if it works.
South Carolina joins a number of other states considering this type of tuition assistance. Oregon’s legislation made national news earlier in 2013. That state’s pilot program would make the amount of repayment at 0.75 percent of the student’s annual income per year of schooling, according to USA Today. That would make a four-year degree loan out to be 3 percent of a student’s annual earnings.
“We don’t want to put our kids out there in the workforce with a huge mountain of debt on their shoulders and they can’t find a job,” Limehouse said. “Their debt is paid for by their earnings.”
In January, the bill will begin in the House’s Committee on Education and Public Works.
“We’ve got a lot of work to do,” Limehouse said. “Lawmaking is all about ideas and ideas can be powerful things. And this is, I hope, a good idea but we’ll find out once it gets into the committee process.”