Tentative deals reached on roads, student loans, officials say

WASHINGTON — Facing weekend deadlines for action, congressional leaders have tentatively agreed to deals overhauling the nation's transportation programs without a Republican provision forcing approval of the proposed Keystone XL oil pipeline, and avoiding a doubling of interest rates for new student loans, congressional officials said Wednesday.

The agreements underscored the pressures both parties face to avoid angering voters and facing embarrassing headlines in the run-up to this November's presidential and congressional elections. Letting road-building programs grind to a halt during an economic downturn would be a blow to the image of lawmakers, while Democrats and Republicans alike seemed eager to avoid enraging millions of students and their parents by boosting the costs of college loans.

In contrast, enactment of the transportation measure would create or save 3 million jobs, said Sen. Barbara Boxer, D-Calif., chief sponsor of the Senate version of the bill. And the student loan measure would spare an estimated 7.4 million students who get subsidized Stafford loans beginning July 1 — this Sunday — from facing $1,000 in higher interest costs over the lives of their loans, which typically take over a decade to repay.

Congressional leaders were planning to combine the highway and student loan measures into a single bill to reduce potential procedural obstacles, and hoped for final approval this week. Lawmakers would then leave Washington for a July 4 recess.

The two-year highway bill would prevent the government's authority to spend money on highways, bridges and transit systems from lapsing Saturday, along with its ability to collect gasoline and diesel taxes.

As the price for the agreement, lawmakers said Republicans dropped a House-approved provision requiring the government to approve the proposed Keystone pipeline, which is to move oil from western Canada to Texas' Gulf Coast.

Pipeline approval — which prompted a veto threat from President Barack Obama — has been a top goal this election year for the GOP.

The student loan pact would keep today's 3.4 percent interest rates on subsidized Stafford loans from doubling for new loans approved beginning Sunday, an automatic increase that Congress enacted five years ago to save money.

Tentative deals reached on roads, student loans, officials say 06/27/12 [Last modified: Wednesday, June 27, 2012 11:24pm]

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