AASCU Federal Highlights – July 2026
A compilation of policy news shared in AASCU’s Weekly Federal Policy Update.
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July’s Lead Story
End of “Duration of Status” Framework
On Thursday, July 16, the Department of Homeland Security (DHS) released a 553-page, pre-publication final rule, scheduled for official publication in the Federal Register on Friday, July 17, that will end the long-standing “duration of status” framework for many foreign students and exchange visitors. If published as scheduled, the rule will take effect on Tuesday, Sept. 15.
AASCU is reviewing the full pre-publication document and will continue to update members as more information becomes available, including any clarifications regarding implementation, transition cases, and campus compliance obligations.
Read more.Other news and resources
July Documents & resources
From the week of July 2
ED Issues Final Programmatic Earnings Rule
On Wednesday, the U.S. Department of Education (ED) issued the final rule on programmatic earnings for Title IV higher education programs, established under H.R.1, also known as the One Big Beautiful Bill or the Working Families Tax Cuts Act. Under the rule, undergraduate programs must demonstrate that their graduates earn more than the typical high school diploma holder, while graduate programs must demonstrate that their graduates earn more than the typical bachelor’s degree holder.
Programs that fail to meet the required earnings threshold in two out of three consecutive award years will lose eligibility to participate in the Federal Direct Loan program, and institutions with programs that fail the earnings measure and have more than half the institution’s students or constitute more than half the institution’s revenue may ultimately lose Title IV eligibility for those low-earning programs.
The final rule largely adopts the provisions included in the Notice of Proposed Rulemaking. Among the final rule’s key changes, ED exempts programs at institutions that do not participate in the Direct Loan program and have not done so for the previous five award years from the earnings accountability penalties, delays implementation of earnings accountability penalties for programs whose graduates predominantly earn tipped income until 2026 tax year earnings data are available, simplifies the creation of student cohorts used to measure earnings, and modifies the appeals process for institutions whose programs are identified as low-earning. Read the full text of the final rule.
ED Releases Guidance on Professional Degree Definition for Graduate Student Loan Limits
On Monday, ED released new guidance on its implementation of the revised definition of a “professional degree program” following a recent federal district court order that partially stayed the regulation that established this definition. The guidance applies to the new federal graduate student loan borrowing limits established under H.R. 1, which eliminated Grad PLUS and created two-tiered limits for graduate programs, with higher annual and aggregate limits for students enrolled in qualifying professional degree programs. ED temporarily expanded the list of eligible programs to include several additional health profession programs, many of which are associated with the plaintiffs challenging the rule in court. ED has stated that the guidance will remain in effect while litigation continues and may change as the case proceeds.
Find the full list of programs treated as granting professional degrees, along with their related six-digit Classification of Instructional Program (CIP) codes.
Federal Loan Changes Officially Take Effect
On Wednesday, several changes to federal student loan programs enacted under H.R. 1 officially took effect. Among the most significant changes are:
- Graduate PLUS Loans: New loans can no longer be taken out. Borrowers who previously borrowed Federal Direct Loans and are enrolled in a graduate program may continue to access the program for up to three additional years or until they complete their current academic program.
- Parent PLUS Loans: Borrowing for new Parent PLUS Loan recipients is now limited to $20,000 per year for each dependent student and no more than $65,000 over the life of the student’s education. Existing borrowers may continue borrowing under the previous rules for up to three years or until the student completes the current program.
- Part-Time Borrowing: Eligibility for part-time students will now be calculated based on the percentage of a full-time course load in which they are enrolled.
- Repayment Options: New borrowers will no longer have access to several existing income-driven repayment plans, including Income-Based Repayment (IBR), Pay As You Earn (PAYE), and Saving on a Valuable Education (SAVE). Instead, they will be eligible for the new Repayment Assistance Program (RAP) or the Tiered Standard Plan. Borrowers without new loans issued on or after July 1, 2026, may continue using existing repayment options, and borrowers currently in Income-Contingent Repayment (ICR), including PAYE and SAVE, must transition to another eligible plan by July 1, 2028.
- Workforce Pell Grants: Students enrolled in eligible short-term workforce training programs may now receive Federal Pell Grant assistance through the new Workforce Pell Grant program, pending approval by their state’s governor and ED of the program in which they are seeking to enroll. At the moment, no programs have been approved by state governors or ED for this purpose.
- Graduate Borrowing Limits: The law establishes new annual and lifetime borrowing caps for graduate students, with higher limits available for qualifying professional degree programs than for other graduate programs.
Several implementation details, including the definition of qualifying professional degree programs for graduate borrowing limits, remain subject to ongoing legal developments, as described above. AASCU will continue to monitor updates.
Senate Votes Against Joint Resolution on RISE Rule
Last week, the Senate voted 45-52 against proceeding to consideration of S.J. Res. 196, a joint resolution that would have disapproved ED’s Reimagining and Improving Student Education (RISE) Federal Student Loan Program final regulations. As a reminder, the RISE rule implements the student loan provisions enacted under H.R. 1, including new federal student loan borrowing limits, the phaseout of the Graduate PLUS Loan program, and changes to federal student loan repayment options, as described above.
SCOTUS Upholds Bans on Transgender Athletes and Sports
On Tuesday, the Supreme Court of the United States (SCOTUS) upheld state laws in Idaho and West Virginia that prohibit transgender athletes from participating in women’s and girls’ sports. In a 6-3 decision, SCOTUS held that Title IX allows schools to separate athletic teams by biological sex and rejected constitutional challenges brought against the state restrictions. It is worth noting that more than two dozen states have enacted similar laws, and the National Collegiate Athletic Association (NCAA) has also barred transgender athletes from competing in women’s sports in response to a prior executive order issued by President Trump. The ruling leaves the Idaho and West Virginia laws in place and concludes the immediate legal challenge before the Court.
Two District Court Judges Strike Down ED’s PSLF Rule
On Tuesday, two federal district courts struck down an ED rule that would have narrowed eligibility under the Public Service Loan Forgiveness (PSLF) program by excluding employees of certain employers deemed to have a “substantial illegal purpose.” The rule, finalized in October 2025, was scheduled to take effect this week but was invalidated before implementation. In separate decisions, the U.S. District Courts for the District of Massachusetts and the District of Columbia both ruled against ED, finding that the regulation exceeded ED’s authority under the statute governing PSLF. As a result, the rule has been vacated, and its restrictions will not go into effect unless overturned on appeal. ED has not announced whether and when it might appeal these decisions.
Trump Announces Intention to Nominate Sonderling for DOL
On Monday, President Trump announced his intent to nominate Keith Sonderling to serve as Secretary of Labor. Sonderling, who previously served as Deputy Secretary of Labor, has been serving as Acting Secretary since the departure of former Secretary Lori Chavez-DeRemer in April. His nomination is subject to Senate confirmation. AASCU will continue to monitor updates on his nomination.
From the week of July 16
DHS Finalizes Rule Limiting Length of Stay for International Students
Inside Higher Ed reported that tomorrow, the Department of Homeland Security (DHS) will issue a final rule ending the long-standing “duration of status” policy for F-1 and J-1 international students. Read the pre-published form of this rule.
Effective September 15, this new rule generally limits students’ stay in the U.S. to four years unless they receive an approved extension, replacing the previous policy that allowed students to remain in the country for the duration of their academic program. DHS stated that the change is intended to strengthen oversight by requiring periodic review of students’ immigration status while maintaining that students who continue to meet visa requirements may remain in the U.S. if their extension requests are pending. Some higher education advocacy groups have raised concerns that the rule could increase administrative burdens, create uncertainty due to existing immigration processing backlogs, and present challenges for students enrolled in programs that typically exceed four years, such as many doctoral degrees.
Administration Releases 2026 Unified Regulatory Agenda
Last week, the Trump administration released the Fall 2026 Unified Regulatory Agenda, outlining the U.S. Department of Education’s planned regulatory actions for the coming months. The agenda includes several initiatives that could affect institutions of higher education, including:
- Foreign Gifts and Contracts – The department intends to propose regulations governing institutional reporting of gifts, contracts, and restricted or conditional gifts or contracts from certain foreign sources under Section 117 of the Higher Education Act. The agenda projects a Notice of Intent to Commence Negotiated Rulemaking in November 2026.
- SAVE Plan – The department plans to rescind regulations establishing the Saving on a Valuable Education (SAVE) repayment plan following the 8th circuit’s decision enjoining the rule. The agenda projects a Notice of Intent to Commence Negotiated Rulemaking in August 2026.
Campus Safety – The department proposes negotiated rulemaking to update campus safety and security reporting requirements, including implementation of the Stop Campus Hazing Act. The agenda projects a Notice of Intent to Commence Negotiated Rulemaking in November 2026. - Title IV Eligibility Issues – The department intends to pursue negotiated rulemaking to address institutional mergers, sales, and transfers; changes of ownership; cash management; administrative capability; program length; financial responsibility; the 90/10 Rule; and updates to the McNair Postbaccalaureate Achievement Program regulations. The agenda projects a Notice of Intent to Commence Negotiated Rulemaking in July 2026. However, AASCU understands that this will likely take place early next year.
- Title IX – The department plans to amend Title IX regulations to align with Executive Order 14168 by clarifying that Title IX protections are based on “an individual’s immutable biological classification as either male or female.” The agenda projects final action sometime in July 2026.
- College Textbooks and Credit Transfer – In response to Executive Order 14267, the department plans to pursue negotiated rulemaking to promote competition in textbook sales and improve the transferability of college credits. The agenda projects a Notice of Intent to Commence Negotiated Rulemaking in September 2026.
The Unified Regulatory Agenda also mentioned the department’s ongoing regulatory efforts on matters such as accreditation and federal financial aid. It is worth noting that the Unified Regulatory Agenda is required to be updated twice each year and provides the administration’s projected timeline for regulatory actions. The dates listed are estimates and do not require the department to proceed according to the published schedule.
SBA Exploring How to Launch New Student Loan Program
Today, POLITICO reported that the Small Business Administration (SBA) is considering starting a new program for student borrowers. These loans would aim to attract private sector capital and operate separately from the U.S. Department of Education (ED). As of today, no official announcement about this program has been released by the SBA. AASCU will continue to keep you updated on this matter.
House Education and Workforce Markup on Bills to Expand ED-Related IAAs
On Wednesday, the House Education and Workforce Committee marked up a legislative package of 10 bills that seek to permanently shift core ED responsibilities and programs to other agencies across the federal government. The bills expand upon previously announced Interagency Agreements (IAA) to migrate ED programs to other agencies. Among these bills include the following that pertain to higher education:
- H.R. 9602, Less Bureaucracy, Better Foreign Gift Transparency Act – transfers foreign gift and contract reporting to the Department of State.
- H.R. 9607, Less Bureaucracy, Better Workforce Development Act – transfers management of programs within the Office of Career, Technical, and Adult Education to the Department of Labor (DOL).
- H.R. 9609, Less Bureaucracy, Better Student Aid Act – transfers management of federal student loans, federal student debt, and policies regarding student aid eligibility to the Department of the Treasury.
- H.R. 9611, Less Bureaucracy, Better Higher Education Act – transfers management of certain postsecondary education programs to DOL.
All 10 bills were favorably reported to the House on party-line votes. Further action on these bills, including when and if the full House may consider them, has not yet been announced.
House Education and Workforce Hearing on DEI in Medical Schools
On Tuesday, the House Education and Workforce Committee held a hearing on the impact of diversity, equity and inclusion (DEI) on medical schools. Key topics discussed included medical school DEI policies and curriculum; antisemitism and other forms of discrimination in medical education; gender-related issues in medical education; and the compliance of medical school admissions practices with federal civil rights law. In his opening statement, Chair Tim Walberg (R-MI) described DEI as “indoctrination” that does not prepare medical students with skills but rather turns them into “far-left activists.” Meanwhile, Ranking Member Bobby Scott (D-VA) contended that to combat hatred and discrimination, DEI should be promoted. Witnesses included leadership from three medical schools that the Committee investigated last August.
Secretary of Labor Nomination Hearing
Today, the Senate Health, Education, Labor and Pensions (HELP) Committee held a nomination hearing for Keith Sonderling to serve as U.S. Secretary of Labor. As a reminder, this position was previously held by Lori Chavez-DeRemer who stepped down this spring. Keith Sonderling currently serves as the Deputy Secretary of Labor. Following this hearing, the Committee is expected to schedule a vote to confirm Sonderling as the Labor Department head.
Kent and Mack Speak at Summit on Workforce Pell
Early this week, Undersecretary Nicholas Kent and Assistant Labor Secretary Henry Mack spoke briefly at the Jobs for the Future Horizons 2026 Summit. According to POLITICO, they reported that two Workforce Pell programs have been submitted to ED for approval. Additionally, both expressed support for apprenticeships and hinted at further connecting workforce and college policy through additional rulemaking or re-examining grant priorities.
Lindsey Graham’s Passing and Temporary Replacement Appointed
On Sunday, Senator Lindsey Graham (R-SC) passed away at the age of 71. Sen. Graham, in his tenure, served on the Senate Appropriations Committee. He, along with Sen. Dick Durbin (D-IL), championed the Dream Act, which would allow noncitizens without lawful status who were brought to the U.S. as children and meet certain education or work requirements to earn lawful permanent residence.
On Tuesday, Sen. Graham’s sister, Darline Graham, was sworn into the Senate to finish the remainder of her late brother’s term, ending in 2027. The senator’s death also triggers an August 11 special Republican primary election. The winner of that will go on to face the Democratic nominee, Dr. Annie Andrews, for the general election in November.
New Polling Reveals Decreased Confidence in Higher Education
On Tuesday, a new Lumina Foundation-Gallup poll was released, which indicated Americans’ confidence in higher education continues to decline. In this report, 38% of U.S. adults said they have “a great deal” or “quite a lot” of confidence in colleges and universities, extending a downward trend that has persisted over the past decade.
The decline was particularly pronounced for Democrats, whose confidence fell from 61% last year to 50%. Confidence among Independents and Republicans remained largely unchanged at 39% and 23%, respectively. According to the survey, the primary drivers of declining confidence include concerns about perceived political agendas, the rising cost of higher education, and the belief that colleges are not adequately preparing students for the workforce.
From the week of July 23
House Passes Continuing Resolution
On Tuesday, the U.S. House of Representatives passed a continuing resolution for fiscal year 2027, voting to extend government funding and operations through December 4. The measure is clean without policy riders, lacking any extraneous partisan matters not directly related to the extension of government funding. However, nearly all Democrats voted against the measure. The primary opposition voiced by Democrats concerns the lack of constraints on how U.S. Immigration and Customs Enforcement (ICE) can use its funding. Additionally, Democrats object to the omission of the Administration’s requested exceptions, known as “anomalies.” These anomalies are necessary for programs to operate properly after the end of a fiscal year for which a final appropriations legislation has not been approved by Congress. Ultimately, six Democrats joined Republicans to advance the bill in a 220-205 vote.
Senate Majority Leader John Thune (R-SD) remarked that the Senate will vote on a short-term spending bill before the August recess. He also noted that Senate Republicans are negotiating with the administration and Senate Democrats regarding needed anomalies.
Federal Judge Rules on Administration’s Retroactive Cancellation of Grants
On Friday, a federal judge ruled that federal officials cannot revoke existing grants based on new government priorities. The decision follows a series of litigation from a coalition of 21 state attorneys general and three governors who sued the Trump Administration over billions of dollars in federal grant cancellations. The ruling protection extends to university research grants that were canceled due to discrepancies against the Trump Administration’s political priorities. The Administration has not yet indicated whether it intends to appeal this decision.
House Education and Workforce Marks Up MATCH and Title IX Clarification Acts
On Wednesday, the House Education and Workforce Committee marked up ten bills, including H.R. 8183, the MATCH Act, and H.R. 8781, the Title IX Clarification Act. The MATCH Act establishes systems to better connect skilled workers and students with applicable workforce opportunities and advanced out of Committee on a unanimous 33-0 vote. The Title IX Clarification Act defines prohibited discrimination under Title IX through a codified definition of biological sex and advanced out of committee by a party-line vote of 18-15. It has not yet been announced when and if these bills will be considered by the full House. AASCU will continue to report on any updates.
Senate Health, Education, Labor and Pensions (HELP) Committee Markup Scheduled
This week, the Senate HELP Committee announced a full-committee markup of ten bills, including S. 2511, the College Transparency Act, and S. 5046, a bill to prohibit the transfer of certain offices and functions of the Department of Education (ED) to other federal agencies. The College Transparency Act would establish a postsecondary data system and eliminate the current prohibition on a student unit record system in the Higher Education Act. S.5046 would block certain interagency agreements with the Department, including the Office of Postsecondary Education. The markup will occur next week, on Thursday, July 30. AASCU will report on amendments and developments related to these bills.
House Democrats Call for Reversal of Proposed OCR and OSERS Transfers
A group of House Democrats is urging the Trump Administration to abandon plans to transfer the Department of Education’s Office for Civil Rights (OCR) to the Department of Justice and the Office of Special Education and Rehabilitative Services (OSERS) to the Department of Health and Human Services. In a joint letter signed by 86 Democratic legislators, they argue that only Congress has the authority to eliminate or restructure these offices and contend that the proposed transfers are unlawful. They also warn that moving the offices would weaken protections for students, families, and individuals with disabilities by shifting responsibilities to agencies they say are not equipped to carry out their missions. The letter comes amid broader concerns about OCR’s existing backlog of civil rights cases and recent reports highlighting staffing and enforcement challenges.
Final Rule Issued Eliminating Title VI Disparate-Impact Liability
In tomorrow’s Federal Register, ED is set to publish final regulations eliminating disparate-impact liability provisions from the regulations promulgated to implement Title VI of the Civil Rights Act at the Department. “Disparate impact” generally refers to practices or policies that, at face value, are neutral but go on to negatively affect a protected class. The Administration states that there are “serious statutory and constitutional concerns” with the provisions and that the revisions are intended to emphasize equal treatment under the law and reduce reliance on demographic outcomes in civil rights investigations. The action follows similar changes made by the Department of Justice in December 2025 and marks another step in the Administration’s broader effort to revise federal civil rights enforcement policies, consistent with Executive Order 14281, signed by President Trump in April 2025. This final rule will be effective upon tomorrow’s publication.
ED Outlines 2027–28 FAFSA Beta Testing Plan
This week, ED announced its beta testing plan for the 2027–28 Free Application for Federal Student Aid (FAFSA), with testing set to begin on August 5 ahead of the form’s public release by October 1. The testing will occur in two phases, beginning with a limited group of school districts, colleges, and community organizations before expanding in late August or early September to allow students and parents to request participation through studentaid.gov. Participating applicants will submit official FAFSA forms, and institutions and state agencies may begin receiving a limited number of official Institutional Student Information Records (ISIRs) during the testing period. The Department said the phased rollout is intended to identify technical issues, improve the user experience, and allow schools and state agencies to test their systems before the nationwide launch in October.
House Democrats Convene Panel on Federal Student Loan System Changes
On Wednesday, House Education and Workforce Committee Ranking Member Bobby Scott (D-VA) convened a panel of higher education leaders and student advocates this week to examine the Trump Administration’s recent changes to the federal student loan system. Panelists argued that provisions enacted through H.R. 1, also known as the One Big Beautiful Bill Act, including the elimination of Grad PLUS loans, new borrowing caps, and changes to Pell Grant eligibility and repayment options, could make college less affordable and push more students toward private loans. Speakers also raised concerns about the impact on graduate students, low-income borrowers, and students pursuing high-cost professional degrees, while warning that millions of borrowers are already struggling to return to repayment after the pandemic-era pause.
From the week of July 30
Senate HELP Committee Marks Up Bills on Transparency, Loans, and IAAs
Today, the Senate HELP Committee marked up ten bills, including S. 2511 — the College Transparency Act, S. 4097 — the State-Based Loan Awareness Act, and S. 5046 — a bill to prohibit the transfer of certain offices and functions of the U.S. Department of Education (ED) to other federal agencies.
- The College Transparency Act would establish a student-level postsecondary data system and eliminate the current prohibition on a student unit record system in the Higher Education Act. This bill was favorably reported by a vote of 21-1.
- The State-Based Loan Awareness Act would reduce preferred lender list requirements for state-based nonprofit educational lenders. This bill was favorably reported by a vote of 20-2.
- S.5046 would block certain inter-agency agreements (IAAs) with ED, including the IAA that transferred programs from the Office of Postsecondary Education at ED to the U.S. Department of Labor. This bill was favorably reported with an amendment requiring the U.S. Secretary of Education to report on the cost of the current IAAs, by a vote of 13-9.
The Committee also favorably reported the nomination of Keith Sonderling to be the Secretary of Labor by a vote of 12-11. It has not yet been announced when and if these bills and the Sonderling nomination will be considered by the full Senate.
Student and Exchange Visitor Information System (SEVIS) Notice of Proposed Rulemaking (NPRM)
Today, the Federal Register published a Notice of Proposed Rulemaking (NPRM) seeking comment on the Department of State’s Exchange Visitor Program, which allows participants to travel to the United States for educational and cultural exchange opportunities. The Proposed Rule would broaden the circumstances under which J-1 exchange visitors’ programs may be terminated, potentially requiring affected participants to leave the country. The Department of State will accept public comments until September 28.
Some FSA Staff to Move Over to Treasury Office
Starting tomorrow, the Office of Federal Student Aid (FSA) and some of its staff are scheduled to begin vacating the Lyndon B. Johnson Department of Education Building. In accordance with the Administration’s Federal Student Assistance Partnership, an IAA announced in March, FSA is now expected to transfer to a Department of the Treasury Building. Additional offices within ED are also expected to relocate to a former U.S. Agency for International Development (USAID) building, a move the Administration announced FSA would make in March but has since shifted. A timeline for the continued vacating of ED offices has not yet been announced.
FSA staff instructed to vacate their offices this week will relocate to the Treasury Department building on Aug. 17, with a second wave of staff expected to move to K Street on Sept. 8. Until then, some employees are expected to work remotely, despite the Administration’s broader opposition to remote work. The move comes during a busy period for FSA staff and college financial aid administrators as a new academic year begins. ED’s spokesperson, Ellen Keast, stated that FSA has operated separately from the rest of the Department before and expects no disruption to services.
New Draft Released of Protect College Sports Act
On Tuesday, it was reported that Senate Commerce Committee Chairman Ted Cruz (R-TX) and Ranking Member Maria Cantwell (D-WA) circulated a revised version of the Protect College Sports Act, a bipartisan bill to regulate college sports in the age of name, image, and likeness (NIL). As a reminder, versions of this legislation have not addressed issues pertaining to whether college athletes are also employees for which collective bargaining and other employee protections may apply.
The newest draft reportedly includes several concessions sought by the Big Ten and Southeastern Conferences, including expanded legal protections and the creation of a $20 million athlete retention pool for schools to use in addition to existing revenue-sharing caps. While Senate leaders continue to push for floor consideration before the August recess, the bill’s prospects remain uncertain as negotiations continue. AASCU will continue to follow these developments.
Federal Court Rules Against In-State Tuition for Undocumented Students
On Friday, a Trump-appointed federal judge in Illinois blocked several state laws allowing certain undocumented students to qualify for in-state tuition, state financial aid, and scholarship programs. The court found that the laws conflict with federal immigration law and deemed them unconstitutional and invalid, prohibiting the state from enforcing them. The decision comes as the U.S. Department of Justice continues to challenge similar policies in multiple states that provide in-state tuition and other educational benefits to certain undocumented students.
The state has 14 days to appeal, and during that period, the injunction will not take effect. In response to the decision, a spokesperson for Illinois Governor JB Pritzker said that they are carefully reviewing the ruling and assessing next steps, but that “this effort by the Trump Administration will not stop our commitment to help all of our young students achieve their potential.”
Federal Keyword Searches Canceled Research Funding
Late last week, court filings in a lawsuit brought by University of California researchers revealed that federal agencies relied extensively on keyword searches to identify research grants for termination. According to the filings, the searches were used to flag projects the administration viewed as inconsistent with its political priorities, often involving topics such as diversity and climate change.
The findings have raised broader questions about the process and authority behind federal grant cancellations. Following court orders, some terminated grants have since been reinstated. The National Science Foundation (NSF) also faces separate litigation related to internal anti-DEI guidance that influenced grant termination decisions. On July 17, a federal judge ruled that the administration lacks authority to cancel existing grants solely because they do not align with new presidential policy priorities. AASCU will keep you updated on the status of these cases and final rulings.
