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Date:
5/8/2025
ACE Letter on Negotiated Rulemaking Committees (May 8, 2025)
The American Council on Education (ACE) sent a letter to the U.S. Department of Education (the Department) in response to the notice from the Department announcing the possible formation of negotiated rulemaking committees. The letter welcomes efforts to address the regulatory swing between different administrations and emphasizes that there has been significant cost and confusion as campuses attempt to repeatedly understand and implement radical shifts in regulatory requirements within a space of only a few years’ time. It offers suggestions and considerations for (1) Pay As You Earn (PAYE) and Income Contingent Repayment (ICR) student loan repayment plans; (2) refining definitions of a qualifying employer for the purposes of determining eligibility for the Public Service Loan Forgiveness Program; (3) reporting Requirements under Section 117 of the HEA; (4) Gainful Employment and Financial Value Transparency (GE/FVT); (5) bundled services guidance; (6) financial responsibility standards; (7) administrative capability; and (8) certification procedures. The letter concludes by emphasizing how requirements on institutions to meet state licensure requirements for every state in which they enroll students will be immensely difficult to manage for any program with a distance education component and represents a problematic expansion of federal regulations in a way that runs contrary to innovative distance education.
Topics:
Accreditation, Authorizations, & Higher Education Act | Financial Aid, Scholarships, & Student Loans | Program Integrity & Gainful Employment | Students
Date:
5/5/2025
U.S. Department of Education DCL on Title IV Obligations to Help Struggling Borrowers (May 5, 2025)
U.S. Department of Education (the Department) issued a Dear Colleague Letter (DCL) to institutions of higher education reminding them of their shared responsibility under Title IV to support student loan borrowers. In the DCL, the Department urges all institutions of higher education that receive federal funding assistance to reach out to all former students to remind them of their obligation to repay any federal student loan that is not in deferment or forbearance and urges that they do so before June 30, 2025. The Department also notes that it maintains data on the repayment status of federal student loan borrowers and provides information in the College Scorecard about the status of each institution’s borrowers after they enter repayment. The Department plans to use the data to calculate rates of nonrepayment by institution and will publish the information on the Federal Aid Data Center later this month. Finally, the DCL concludes that under the Higher Education Act (HEA), institutions are required to keep their cohort default rates (CDR) low or they risk losing eligibility for federal student assistance, including Pell Grants and federal student loans.
Topics:
Financial Aid, Scholarships, & Student Loans | Students
Date:
5/2/2025
President’s FY 2026 Discretionary Budget Request (May 2, 2025)
In the Trump Administration’s budget request, which was sent by Office of Management and Budget Director, Russell T. Vought to Senator Susan Collins and the Committee on Appropriations, the U.S. Department of Education would see a 15% reduction. Specifically, the cover letter and included chart setting forth discretionary spending changes calls for eliminating Federal Work Study, Supplemental Educational Opportunity Grants (SEOG), Adult Education, Migrant Education and Special Programs for Migrant Students, Equity Access Centers, Teacher Quality Partnerships, TRIO programs, Gaining Early Awareness and Readiness for Undergraduate Programs (GEAR UP), and the Higher Education Act (HEA) Title III-A Strengthening Institutions Program. Additionally, several substantial budget cuts are proposed for other programs and offices such as the Office for Civil Rights (OCR) to “refocus away from DEI and Title IX transgender cases.” Cuts to other agencies that could impact postsecondary institutions include the National Science Foundation (a 56% decrease) and the U.S. Department of Agriculture (an 18% decrease).
Topics:
Accreditation, Authorizations, & Higher Education Act | Contracts | Financial Aid, Scholarships, & Student Loans | Grants, Contracts, & Sponsored Research | Higher Education Act (HEA) | Students
Date:
4/29/2025
Education and Workforce Committee Pass the Student Success and Taxpayer Savings Plan (Apr. 29, 2025)
The Education and Workforce Committee passed the “Student Success and Taxpayer Savings Plan” with an intent to save over $330 billion by way of reforming postsecondary education through three main initiatives: (1) strengthening accountability for students and taxpayers, (2) streamlining student loan options, and (3) simplifying student loan repayment. Specifically, the bill would require colleges “to have skin in the game” by paying a portion of their students’ unpaid loans based on how much of a return on investment the degree provided. It would set a maximum cap of $50,000 for undergraduate student loans, eliminate the GradPLUS loan for graduate students, and amend the maximum aggregate student loan cap to $100,000 for graduate students and $150,000 for professional students, as well as impose a total cap of $50,000 on Parent PLUS loans, requiring students to borrow the maximum amount they can before their parent takes out a loan on their behalf. Further, the bill repeals the SAVE plan and streamlines other repayment plan options into either a fixed repayment plan or an income-driven repayment plan. In addition, the bill proposes (1) additional funding to reduce funding shortfall for the Pell Grant Program, (2) elimination of the Gainful Employment Rule, (3) establishment of performance-based grants to institutions, (4) allowing student loan rehabilitation twice instead of once, and finally, (5) revises deferment and forbearance terms. In addition to the bill, the Committee has put together a Fact Sheet as well as a section-by-section summary and a preliminary cost estimation sheet. The bill now heads to the Budget Committee before it is considered on the House Floor.
Topics:
Accreditation, Authorizations, & Higher Education Act | Contracts | Financial Aid, Scholarships, & Student Loans | Grants, Contracts, & Sponsored Research | Higher Education Act (HEA) | Students
Date:
4/29/2025
ACE Letter Opposing the Student Success and Taxpayer Savings Plan (Apr. 29, 2025)
The American Council on Education (ACE) sent a letter (the Letter) to Rep. Tim Walberg, Chairman of the Committee on Education and Workforce expressing opposition to the “Student Success and Taxpayer Savings Plan” – a proposal to provide a budget reconciliation affecting education programs. The Letter states that the bill proposes policies that would harm students, institutions, and borrowers, specifically noting the reduction in student aid to low-income students and onerous financial penalties on institutions, particularly those least able to meet them. It states opposition to proposals including: (1) limiting Pell eligibility; (2) eliminating subsidized student loans; (3) eliminating Grad PLUS and restricting Parent PLUS loans without adequate increases in loan limits; (4) limiting the availability of federal aid to the median cost of specific programs; (5) eliminating/ reducing forbearances and deferments; and (6) establishing less favorable loan repayment options, all of which the Letter avers will lead to students paying more, borrowing more, and facing costlier repayment terms. The Letter critiques the proposal to create an institutional risk-sharing process, framing it as “significantly problematic.” The Letter states that the proposal would unduly penalize the institutions serving the largest number of students operating in the labor market and concludes that “attempting to design and implement an accountability scheme with such an uneven, incredibly complex, and punitive approach will only result in enormous negative consequences.”
Topics:
Accreditation, Authorizations, & Higher Education Act | Contracts | Financial Aid, Scholarships, & Student Loans | Grants, Contracts, & Sponsored Research | Higher Education Act (HEA) | Students
Date:
4/21/2025
U.S. Department of Education to Begin Federal Student Loan Collections (Apr. 21, 2025)
The U.S. Department of Education Office of Federal Student Aid (the Department) announced that it will resume collections of its defaulted Federal student loan portfolio beginning May 5, 2025 – the first time since March 2020. It states that resuming collections protects taxpayers from shouldering the cost of Fderal student loans that borrowers willingly undertook to finance their postsecondary education. Additionally, the resumed collections will be paired with a comprehensive communications and outreach campaign to ensure borrowers understand how to return to repayment or get out of default. Defaulted borrowers will be contacted urging them to contact the Default Resolution Group to make a monthly payment, enroll in an income-driven repayment plan, or sign up for loan rehabilitation. Later in the summer, the Department will send the required notices beginning administrative wage garnishment. The Department will also launch an enhanced Income-Driven Repayment (IDR) process, simplifying the time that it will take borrowers to enroll in IDR plans and eliminating the need for borrowers to recertify their income every year. Finally, the Department intends to enlist its partners – states, institutions of higher education, financial aid administrators, college access and success organizations, third-party servicers, and other stakeholders – to assist in the campaign.
Topics:
Financial Aid, Scholarships, & Student Loans | Students
Date:
4/14/2025
2024-25 and 2025-26 FAFSA Updates (Apr. 14, 2025)
U.S. Department of Education Office of Federal Student Aid (the Department) announced updates to the 2024-25 and 2025-26 Free Application for Federal Student Aid (FAFSA) form, including guidance for institutions with students who have a pseudo-social security number (SSN), updates about new FAFSA Submission Summary request functionality in FAFSA Partner Portal (FPPP) for paper filers, and the Institutional Student Information Record (ISIR) request functionality.
Topics:
Financial Aid, Scholarships, & Student Loans | Students
Date:
4/11/2025
U.S. Justice Department Ends Illinois DEI Scholarship Program (Apr. 11, 2025)
The U.S. Department of Justice (the Department) announced that it threatened to file suit against the State of Illinois and six universities after learning that an Illinois scholarship program allegedly unconstitutionally discriminated on the basis of race in violation of the Fourteenth Amendment. The scholarship program established by Illinois law purportedly used race as a prerequisite for participation, excluding students of some races but not others inconsistent with the Department’s interpretation of federal law and Students for Fair Admissions Inc. v. President & Fellow of Harvard Coll. (2023). Following notice from the Department, multiple universities ended their participation in the program, including Northwestern University, Loyola University of Chicago, and the University of Chicago. The Department noted that none of the institutions that the Department notified of its findings elected to continue participation in the program, and the Illinois Board of Higher Education notified the Department that it has suspended all activities related to the program.
Topics:
Discrimination, Accommodation, & Diversity | Financial Aid, Scholarships, & Student Loans | Race and National Origin Discrimination | Students
Date:
4/10/2025
U.S. Department of Education 2025-26 Final Funding Authorization for the Campus-Based Programs (Apr. 10, 2025)
U.S. Department of Education Office of Federal Student Aid announced the final funding worksheets for the 2025-26 Statement of Account for Campus-Based programs are available on the COD website. The announcement details the total federal funds appropriated for allocation to schools, as well as a review of how the Campus-Based Awards for a School are determined, noting that underutilization of 2023-24 funds could impact a school’s allocation of 2025-26 funds. The announcement also states that individual schools will be notified by email that the 2025-26 Campus-Based allocation information was posted to the COD website. Finally, the announcement notes that some schools may qualify for supplemental 2025-26 Campus-Based funds based upon a reallocation of funds not spent by institutions from 2024-25 allocations and specific information on reallocation will be provided in subsequent communications.
Topics:
Financial Aid, Scholarships, & Student Loans | Students
Date:
4/8/2025
U.S. Department of Education Comment Request; Income Driven Repayment Plan Request for Federal Direct Loans and Federal Family Education Loan Programs (Apr. 8, 2025)
U.S. Department of Education (the Department) issued a comment request regarding income driven repayment plans for federal direct loans and the federal family education loan programs. The Department requested an emergency clearance for this revision of the information collection and asked that the full clearance package be filed at the same time, and noted that the Department will initiate a 60-day public comment period upon notification of emergency approval. The Department will update the IDR Request Form that is used by a borrower to enroll, recertify, or change their IDR plan to support the provisions identified by the court injunction issued February 18, 2025. Specifically, the form is being updated to remove the SAVE plan as an option for borrowers to select and remove the other early-implemented components of the Final Rule that applies to the other IDR plans and additional updates to improve clarity and the borrower experience.
Topics:
Financial Aid, Scholarships, & Student Loans | Students

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