Protecting Taxpayers from Student Loan Bailouts Act

This bill limits the Department of Education’s power to make new rules or actions for federal student aid if they are large and would cost the government more. If a draft rule would raise the government’s subsidy cost, the department must stop working on it. The department also may not issue a proposed or final rule, or take an executive action, if the change is economically significant and would increase subsidy cost. “Economically significant” means a likely yearly effect of at least $100 million, or a major impact on the economy, jobs, or governments. These limits apply after the law takes effect and are in addition to other required cost reviews.

Key points:

• Who is affected: The Department of Education and its rules for federal student aid programs.
• What changes: No moving forward on draft rules that increase subsidy cost; no issuing proposed/final rules or executive actions that are economically significant and increase subsidy cost.
• When: These restrictions start after the law is enacted.