Rachel Norgaard is one of many students working her way through school with the help of the federal government.

The junior in civil engineering from Ankeny is in her second year, facing five more in pursuit of an architecture degree. By the time she graduates, Norgaard will have paid, with the help of scholarships and loans, approximately $20,000 in tuition alone.

This year, Norgaard took out a $1,600 federally subsidized loan and a $1,300 Perkins loan to help offset the cost of attending college. The loans ease her current burden and defer payment until after graduation.

“So far, scholarships and loans have paid for everything,” Norgaard said. “I depend a lot on my loans – I like not worrying about paying them until I get out of school.”

Norgaard said she also plans to consolidate her loans when she graduates, which is common among people who depend on the help of the federal government to pay for school.

“After graduation, I’ll have so many other things, so much growing up to do,” she said. “That will be one less thing I’ll have to worry about.”

Norgaard may have to worry more about consolidating her loans after graduation, however, if a proposal from President Bush to eliminate fixed interest rates on consolidated student loans passes, according to a New York Times article.

Bush recommended to leading House Republicans that they support an end to the current program, which allows college graduates to combine student loans at a fixed interest rate and take up to 30 years to repay the money.

Instead, the consolidated loans would be offered at variable rates, changing from year to year, which would increase the repayment amount of the loan.

Earl Dowling, director of student financial aid, said although nothing is certain at this point, the proposal will hurt students who borrow money from the federal government to pay for college if it becomes law.

“It will affect our students,” he said. “The number, I don’t know. At first read, I don’t believe I’d be recommending we support this proposal.”

Dowling said he has not seen Bush’s proposal itself, but from the Times article he has two problems with what he knows about it.

First, he said, the proposal intends to increase the cost of loan consolidation.

“The Financial Aid Office supports and encourages students to consolidate their student loans,” he said. “Consolidating student loans offers a cost-effective way for students to manage financial obligations.”

With the current program, Dowling said students with consolidated loans do not have to worry if the interest rate goes up, because they have a guaranteed interest rate.

Changing the interest rate every year would increase the cost to students, he said, but only those who have yet to consolidate loans.

“Regardless of what happens, any change would not affect students and graduates who have already consolidated their loans,” he said.

The other problem with the proposal is it charges students for that financial aid, Dowling said.

The federal government currently has a $1.3 billion deficit in the Pell Grant program, he said, which provides grants to low-income students pursuing bachelor’s degrees. The deficit would be covered by funneling funds from loan repayments into the Pell Grant program.

“This proposal would pull out Pell Grant student financial aid by effectively raising interest rates on loans to students,” he said. “If that’s so, we need to take a hard look at that proposal.”

Students facing repayment of student loans must remember one thing: At this point, it is only a proposal, Dowling said.

“It’s been offered in the House, and it has a long way to go before it’s considered a law,” he said.