A sweeping Republican proposal to overhaul federal higher education policy and financial aid eligibility has sparked fierce debate over its impact on low-income students and borrowers, as the House Education and Workforce Committee prepares to advance the legislation this week.
Introduced by Committee Chair Rep. Tim Walberg (R-Mich.), the bill, formally titled the Student Success and Taxpayer Savings Plan, is part of a broader GOP effort to trim $330 billion from education and workforce programs to offset tax cuts proposed by the Trump administration. The proposal would significantly reshape the Higher Education Act of 1965 and includes elements of the GOP’s College Cost Reduction Act.
Among its most high-profile provisions is the expansion of Pell Grant eligibility to short-term workforce training programs, a policy with bipartisan support. The bill also allocates substantial increases in future Pell funding to address a projected $2.7 billion shortfall by 2026.
However, those increases come with stricter eligibility rules. The bill redefines “full-time” enrollment from 12 credit hours per semester to 30 hours per year and bars students attending less than half-time—fewer than six credit hours per semester—from receiving Pell aid. Critics say these changes could disproportionately harm low-income students who often work while attending school.
“These students are almost always working a substantial number of hours each week and often have family responsibilities,” David Baime, senior vice president for government relations at the American Association of Community Colleges, told Inside Higher Ed. “We commend the committee for identifying substantial additional resources to help finance Pell, but it should not come at the cost of undermining the ability of low-income working students to enroll at a community college.”
The proposal would also eliminate subsidized student loans starting in July 2026—loans that do not accrue interest while a student is enrolled—and consolidate existing repayment plans into just two options. That change, according to the Congressional Budget Office, could save more than $100 billion over 10 years.
Loan caps would be imposed as well: $50,000 for undergraduates, $100,000 for graduate students, and $150,000 for professional programs. The Parent PLUS and Grad PLUS loan programs, which provide additional borrowing options for families and graduate students, would face sharp restrictions.
At Tuesday’s markup hearing, Democrats voiced concern that the changes could deepen educational inequities.
“This bill is a dream-killer,” Rep. Suzanne Bonamici (D-Oregon.) said in the hearing, warning that the proposed restrictions would block access to higher education for many who rely on federal support to enroll.
The committee is expected to vote on the bill this week.
