NEW YORK — Student lender Sallie Mae spent $1.86 million to lobby the U.S. government in the first quarter, as lawmakers debated the passage of a law that cut private lenders out of the federal student loan program.
The amount was nearly double the $970,000 the company spent on lobbying in the year-ago period, according to a report filed this week with the House clerk's office.
For years, families could either get federal loans directly from the government or through private lenders such as Sallie Mae. The federal government subsidized companies that provided such loans.
But last month, President Barack Obama signed a law that allows only the government to originate federal student loans, cutting out middlemen like Sallie Mae. The Congressional Budget Office has said the law will save taxpayers $60 billion in fees and free up funds for Pell Grants, which go to the neediest students.
The move means a drastic reshaping of Reston, Va.-based Sallie Mae, which wrote a record $7.7 billion in federal student loans in the first three months of the year. On Wednesday, the nation's largest student lender said the new law will cost 2,500 Sallie Mae workers their jobs.
Sallie Mae, formally known as SLM Corp., also lobbied in the first quarter on financial reforms and the establishment of a consumer financial protection agency, according to the report filed April 20. The company also lobbied the Treasury Department on tax issues relating to 529 savings plans, which let families invest money for college and take distributions tax-free.