Senate Majority Leader Harry Reid (D-NV) sent a letter to House Speaker John Boehner (R-OH) and Senate Minority Leader Mitch McConnell (R-KY) to offer a proposal to pay for a one-year extension of student loan rates to prevent them from doubling on July 1.
Reid's proposal would reduce business tax deductions for pension contributions and increase premiums paid by employers for the insurance provided by the Pension Benefit Guaranty Corporation (PBGC) to cover the cost of extending the 3.4 percent interest rate on subsidized Stafford loans.
The pension proposal was included in transportation legislation that garnered Republican support in the Senate, but hasn't been passed in the House.
"I suggest that we use part of these offsets to pay for the student loan legislation, and pass that measure immediately so that middle class families will not see their interest rates double on July 1st," Reid wrote in the letter. "The remainder of these offsets will still be available to finish completion of the transportation jobs bill once the conference committee completes its work."
Reid's proposal comes on the heels of two proposals House and Senate Republican leaders sent to the White House. In a letter to Obama, Republicans offered two new proposals to cover the $6 billion cost of extending the 3.4% interest rate for another year.
The first proposal would increase the amount federal employees contribute to their retirements.
The second proposal would:
Publication Date: 6/8/2012