Congress approves deal on transportation, student loans

Washington — In yet another case of brinksmanship, Congress Friday — right on deadline — approved a deal to freeze a low-interest rate on student loans and approved billions of dollars in spending on local transportation projects.

All members of the Connecticut congressional delegation voted for the package, the result of a compromise between House Republicans and Senate Democrats that also authorized the federal flood insurance program for another five years.

The bill passed 373-52 in the House and 74-19 in the Senate.

But some Connecticut lawmakers gave their support to the legislation grudgingly.

Rep. Rosa DeLauro, D-3rd District, said she supported freezing the Stafford loan rate to 3.4 percent. It was slated to jump to 6.8 percent July 1.

But she said she “had deep concerns about the bill” because it would weaken environmental protections that the federal government places on transportation projects by limiting the time environmental impact studies can be conducted and excluding some projects from environmental review.

The bill also curbs funding for bike paths and pedestrian walkways, provoking sharp criticism from activists.

“Scores of Connecticut residents are killed and many more injured while walking and cycling each year,” said Kelly Kennedy, executive director of Bike Walk Connecticut. “With less help coming from Washington, ConnDOT must step up its commitment to safety.”

Sen. Joe Lieberman, I-Conn., also said he is disappointed at some of the compromises on environmental issues.

“Despite my serious misgivings, I ultimately voted for this bill because if it did not pass, millions of construction workers would be out of work, students would see interest rates double, and the National Flood Insurance Program would lapse,” Lieberman said.

The bill would provide Connecticut with about $977 million in transportation money until September 2013. But Lieberman said that is not enough for Connecticut’s needs. He wanted the federal distribution formula changed so states like Connecticut that have older transportation systems receive more money.

“My state has one of our nation’s oldest transportation systems — because Connecticut has been around a long time — one of the nation’s highest ratios of traffic volume to miles of road, and is a frequent pass-through state for commuters throughout the Northeast,” Lieberman said on the floor of Senate before it approved the package. “Federal transportation funding should go to areas with the greatest need …”

Sen. Richard Blumenthal, D -Conn., was more supportive, calling the transportation money “vital” to Connecticut.

“We cut the ribbon for the Pearl Harbor Memorial Bridge (in New Haven) just a week ago and that project would not be completed without this bill,” he said.

Blumenthal also said the new transportation bill is needed to continue work on the Aetna viaduct in Hartford and the Moses Wheeler Bridge in Stratford, among other state projects.

Authorization to spend money on those projects was set to end tomorrow.

Rep. Joe Courtney, D-2nd District, who introduced a bill to set Stafford loan rates at 3.4 percent permanently, said he is pleased with the one-year freeze.

“Today, more than 70,000 working-class families and young people in Connecticut who rely on the subsidized Stafford student loan program can breathe a sigh of relief,” he said.

But Courtney also said the temporary nature of the bill means Congress will face another spike in the interest rate of the student loans a year from now.

Rep. Jim Himes, D-4th District, said approval of the transportation and student loan legislation “should have been no-brainers from the beginning.”

Congressional attempts to prevent Stafford interest rates from doubling had been stalled because Democrats and Republicans could not agree on a way to make up for the $6 billion in funds the U.S. Treasury would lose if the rate was not raised.

To make up the $6 billion, there was an agreement to raise taxes on pension funds and to limit the number of years students can apply for Stafford loans to six. A student who takes more than six years to graduate will not be eligible for a Stafford loan for the seventh year and beyond.

The transportation compromise was reached after House Republicans dropped their insistence on including authorization for the controversial Keystone XL pipeline in the legislation, and Democrats agreed to the environmental streamlining and conservation funding cuts sought by Republicans.

“We had to give in order to get,” Blumenthal said.