June 26 saw a major shake up for education provisions of the “One Big Beautiful Bill Act” (OBBBA) which Republicans are hoping to advance via the budget reconciliation process which requires only a simple majority to pass.
As has widely been reported, the U.S. Senate Parliamentarian weighed in on whether and which provisions of the Senate Health, Education, Labor, and Pensions (HELP) Committee’s OBBA proposal violate the Byrd Rule.
So, what got caught up in the “Byrd Bath”?
Workforce Pell: Another end in a promising road for short-term Pell, or just a bump in its final journey?
Workforce Pell (also referred to as “short-term Pell”) is not a new concept, and despite significant interest from both parties over the years, it has consistently fallen short of getting passed into law. The Senate HELP proposal expanded eligibility for Pell Grants to students enrolled in short-term (150-599 clock hours), high-quality, workforce aligned programs.
The Parliamentarian has ruled that OBBA’s Workforce Pell provisions cannot be included in their current form. However, with champions on both sides of the aisle and in the Trump administration, this may not yet be the end of its life in this Congress.
What else was impacted by the Byrd Rule?
- Student Loan Repayment Consolidation: This provision would have simplified the student loan repayment system by ending all current loan repayment programs and establishing in their place two repayment plans. While the estimated savings for the Senate proposal has not been released, this is substantively similar to the loan repayment reform included in the House-passed version, which was estimated to decrease federal outlays by $133.6 billion over the 2025-2034 period.
- Limiting student aid eligibility based on citizenship: The provision would have added new language to the HEA listing what groups of non-U.S. citizens qualify for federal aid.
- Public Service Loan Forgiveness Changes: The provision would have prohibited loan payments made while students are in medical or dental internships/residencies from counting towards repayment plans through the PSLF program.
The Senate Budget Committee press release noted several provisions that were still under review by the Parliamentarian, including:
- Regulatory Relief: Repealing Biden-era regulations for Borrower Defense to Repayment and Closed School Discharge.
- Limiting the Regulatory Authority of the Secretary of Education: Restricting the Secretary of Education’s ability to promulgate regulations that increase costs, or subsidies, in the federal student loan programs.
It’s also worth noting that the press release did not mention other provisions from the HELP Committee proposal, including:
- Gainful for All: This provision has been on our “Byrd radar.” The new accountability measure, which is similar to the Biden administration’s Gainful Employment rule but for all programs, would require programs to meet earnings threshold requirements in order to remain eligible for federal loan programs.
- Student Loan Caps: The bill would eliminate Grad Plus loans and cap unsubsidized graduate borrowing at $20,500 per year. It would also cap Parent Plus loans at $20,000 per student per year (with a $65,000 lifetime limit per student).
What’s Next
Senate Republicans are faced with having to ensure what’s left can pay for the other elements of the OBBBA, leaving them with several options:
- Adhere to the Parliamentarian’s rulings by either modifying provisions to be Byrd Rule compliant or removing them altogether.
- Providing a waiver for provisions in violation of the Byrd Rule to be included, which would require 60 votes and seems unlikely given Democrats’ opposition to the bill overall.
- The Senate could seek to change the rules and override the Parliamentarian with a simple majority. (Note: this would be the proverbial “nuclear” option).
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