A bill is making its way through the Illinois General Assembly that could change the way student loans work in the state. The current system is not working, lawmakers say, because students walk out of college with unwieldy debt burdens and uncertain job prospects. Cumulatively, Americans owe more in student loans than they do in credit card debt. Forbes magazine reported in August 2013 that outstanding student loans had passed the $1 trillion mark, crossing into crisis territory.

The bill would authorize a study of a program being tested in Pennsylvania. The “Pay It Forward, Pay It Back” program gives qualifying college students interest-free loans up front and, on graduation, calculates the repayment schedule according to their post-graduation income.

“Pay It Forward” doesn’t represent a tidal wave of student loan reform, but a few other states are trying it out, including Oregon, Ohio and Michigan. New Jersey Gov. Chris Christie vetoed a bill similar to Illinois’ back in January, but not because he opposes the program. Christie wrote that the study would duplicate work already underway in other state departments.

Few lawmakers oppose the idea of easing the burden for student borrowers, but a handful of Illinois legislators are wondering how the state would pay for such a program. The state could find itself with $1.6 billion less in revenue if the General Assembly opts not to extend the income tax increase that will sunset in 2015. If that happens, there will be no room in the budget for the study.

Those reluctant lawmakers are not alone. The Board of Higher Education urges the General Assembly and the governor to move ahead with caution. There is very little evidence yet that “Pay It Forward” actually works, the board notes.

The board has a point. There is very little data yet to gauge just how successful the program is in achieving its objectives. When it is clear that the plan helps borrowers without penalizing other state services and programs, perhaps the skeptics will come on board.


Greenfield Reporter, “Illinois lawmakers advance plan to study need-based, interest-free college loans,” The Associated Press, May 13, 2014

The University Herald Reporter, “Chris Christie Vetoes Bill to Explore ‘Pay it Forward’ Plan That Would Eliminate Student Loans at Public Colleges,” Russell Westerholm, Jan. 14, 2014