Congress·In Committee·S. 4114

Shaheen and Young Introduce Bipartisan Bill to Hold Colleges Accountable for Student Loan Repayment

Student Protection and Success Act

8 days ago·View on Congress.gov·Read full text

Legislative Progress

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Key Points

Starting in fiscal year 2028, colleges where 15% or fewer of borrowers reduce their loan principal by at least $1 within two years would lose eligibility for federal student aid programs, including Direct Loans and Pell Grants. This effectively cuts off federal funding to schools that leave students with unmanageable debt.
From policy text
“an institution that has a cohort repayment rate that is equal to or less than 15 percent shall not be eligible to participate in a program under this part for such fiscal year and for the 2 succeeding fiscal years.”
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Colleges would be required to make "risk-sharing" payments to the government based on how much of their students' loan balances go unrepaid. The payment equals 2% of the school's cohort nonrepayment loan balance, adjusted for the national unemployment rate, giving schools a direct financial stake in student outcomes.
A new College Opportunity Bonus Program would reward schools with repayment rates above 25% that serve low-income students well. These schools could use grant funds for need-based financial aid, academic support services, and accelerated learning opportunities.
From policy text
“the term `eligible institution of higher education' means an institution of higher education that has a cohort repayment rate (as defined in section 455(r)(3)) that is greater than 25 percent.”
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The bonus grant program would be entirely funded by the risk-sharing payments collected from colleges, meaning the worst-performing schools would effectively subsidize investments in the best-performing ones.
From policy text
“The grant program under this section shall be funded only with risk-sharing payments received by the Secretary under section 454(e).”
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Borrowers in certain situations — such as active-duty military service, Peace Corps volunteering, graduate school enrollment, or rehabilitation programs — would be excluded from repayment rate calculations so that schools are not unfairly penalized.
From policy text
“in deferment on repayment of a loan described in subparagraph (A) due to active duty military service of the borrower during a war, military operation, or national emergency”
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The Education Department would be required to collect and publish new data distinguishing how much schools spend on student services versus marketing and recruitment, giving prospective students better insight into how schools invest their resources.
From policy text
“does not include expenditures on marketing, recruitment, or intercollegiate athletic programs”
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Impact Analysis

Personal Impact

Who is affectedScoreImpactCertaintyScopeDurationSentiment

Scores: 1 = low, 5 = highSentiment: -5 to +5 (net benefit)

Milestones

2 milestones2 actions

Mar 17, 2026Senate

Read twice and referred to the Committee on Health, Education, Labor, and Pensions.

Mar 17, 2026

Introduced in Senate

What Happens Next

Projected impacts based on AI analysis

First fiscal year after enactment through fiscal year 2028

Education Department begins notifying schools of their cohort repayment rates and estimated risk-sharing payments

Schools would get advance warning about whether they're at risk of losing federal aid eligibility, giving them time to improve student outcomes before enforcement begins in 2028.

Related News

2 articles

WBIW·1 day ago

Houchin introduces bipartisan bill to hold colleges accountable for student debt

Rep. Erin Houchin introduced the Student Protection and Success Act (H.R. 8009) to link federal aid eligibility to student loan repayment rates. The bill prohibits aid for colleges where 15% or fewer students are on track to repay loans and creates a bonus program for serving low-income students.

WIBC·6 days ago

Houchin Weighs in on 'Dalilah's Law' and New Education Reforms

Congresswoman Erin Houchin highlighted the Student Protection and Success Act, which aims to hold colleges accountable by linking federal funding to a student's ability to repay their loans, arguing that institutions should have a stake in student outcomes to address the national debt crisis.

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