WASHINGTON, D.C. —U.S. Sen. John Cornyn, R-Texas, Wednesday issued the following statement after voting in favor of legislation that makes substantial, market-based reforms to the broken federal student loan program and brings down interest rates for Texas college students:

“I’m proud to have supported a meaningful set of market-based reforms today that will translate into real savings for nearly 650,000 Texas students and their parents who are estimated to borrow over $5 billion in the coming year to help pay for college. These are the kind of bipartisan steps we must continue to take to help our young people succeed and get this economy back on track for a more prosperous future.”

The Bipartisan Student Loan Certainty Act requires that, for each academic year, all newly issued student loans be set to the U.S. Treasury 10-year borrowing rate (specifically, the yield on the 10-year note as determined by the last auction held before June of each year—not the changing daily rate).

The resulting interest rates for loans taken out this year, after July 1, 2013, would be 3.86 percent for all loans for undergraduate students—both subsidized and unsubsidized. Rates would be 5.41 percent on unsubsidized loans for graduate students, and 6.41 percent on PLUS loans for parents and graduate students.

These rates would apply retroactively to newly issued loans taken out after July 1, 2013. The interest rate would be fixed over the life of the loan to provide borrowers with certainty to plan for the future. Additionally, this bill protects against the threat of unforeseen circumstances by imposing a cap to ensure interest rates never exceed 8.25 percent for undergraduate students, 9.5 percent for graduate students, 10.5 percent for PLUS borrowers. The Congressional Budget Office has determined this legislation would save taxpayers $715 million over 10 years.