PHEAA Tells Sallie Mae "We're Not for Sale"
HARRISBURG, Pa. - The board of the Pennsylvania Higher Education Assistance Agency (PHEAA), which provides services to over 170 credit unions in the state, unanimously passed a resolution opposing any attempt to sell the agency to Sallie Mae or any for-profit corporation. Last month, Sallie Mae offered to acquire the business of PHEAA, the state's highly successful student loan agency, for approximately $1 billion over the next five years. Sallie Mae, the largest provider of student loans in the U.S., primarily provides federally guaranteed student loans originated under the Federal Family Education Loan program and offers comprehensive information and resources to aid students, parents and guidance professional with the financial aid process. The company currently owns or manages student loans for more than seven million borrowers. According to the Pennsylvania Credit Union Association, Gov. Ed Rendell was described as being "intrigued" by Sallie Mae's proposal, while others, particularly state legislators, "flat out rejected the notion," said PCUA. "PHEAA is not now and never will be for sale, especially to a profit-driven corporation with a track record of overcharging borrowers, laying off workers, and gobbling-up any organization that stands between students and a quest for bigger profits," said PHEAA Chairman Elinor Taylor. "We have an obligation to protect the long-term interests of Pennsylvania students and to be wise enough to see through a get-rich-quick scheme designed to enrich corporate shareholders, not the Commonwealth of Pennsylvania." PHEAA manages $45 billion in student loans and serves nearly four million students nationally. The agency was the first to offer a "free" or zero-fee student loan.