Sponsors (8)
The bill restores prior statutory student‑loan and aid rules and simplifies an endowment excise, trading broader temporary borrower relief and wider aid eligibility for greater statutory clarity and potential near‑term federal savings, but it risks harming some borrowers and students, creating transitional administrative confusion, and producing mixed fiscal effects for taxpayers.
Students who were harmed by predatory or closed schools (including low‑income and former students) are more likely to obtain borrower‑defense and closed‑school loan discharges under the reinstated prior rules.
Colleges and students get clearer, more consistent statutory definitions for which programs qualify for federal student aid, reducing ambiguity for institutions and applicants.
Repealing temporary expansions of forgiveness/repayment benefits could reduce federal outlays compared with maintaining broader or temporary forgiveness programs, potentially lowering near‑term costs to taxpayers.
Borrowers who relied on temporarily expanded PSLF, paused repayments, forbearance, or modified repayment terms risk losing credit toward forgiveness or seeing their balances resume normal accrual, harming students and middle‑class families who counted on those measures.
Narrowing and clarifying program eligibility could exclude some programs that previously qualified for federal aid, reducing access to federal student aid for affected students and causing enrollment and revenue losses for colleges that offer those programs.
Fiscal trade‑offs: taxpayers could face higher costs from increased borrower‑defense and closed‑school discharges while also seeing reduced revenue from a lower, single endowment excise rate—raising deficit risks unless offset elsewhere.
Based on analysis of 7 sections of legislative text.
Reverses several reconciliation‑era changes to student‑loan relief and borrower protections, defines which programs count for a key loan rule, and sets a flat 1.4% endowment excise tax starting in 2026.
Introduced March 26, 2026 by Richard Blumenthal · Last progress March 26, 2026
Nullifies multiple changes made by a recent reconciliation act to federal student‑loan programs and borrower relief rules, restores prior statutory language about loan eligibility by creating a defined term “covered educational program,” and replaces a tiered private university endowment excise tax with a single 1.4% rate for tax years beginning after December 31, 2025. The bill effectively undoes adjustments to loan repayment, deferment/forbearance, Public Service Loan Forgiveness, borrower‑defense and closed‑school discharge provisions and clarifies which types of programs fall under a key loan‑eligibility rule.