One Big Beautiful Bill Act

Signed into law: July 4, 2025

The One Big Beautiful Bill Act (OBBBA) is the budget package that was approved by Congress to ensure continued funding for many federal expenditures. We are focusing specifically on the aspects that impact federal financial aid for higher education. Many of the changes create new questions for how they will be implemented and how they may impact existing policies and regulations. We highlight some unanswered questions and concerns in each section. We are waiting for clarity from the Department of Education for how, when, and for who the changes in the OBBBA will go into effect and these are the answers we have so far. 

Federal Student Aid has published two additional resources to help students understand their particular situation and to better define terms frequently used within the OBBBA. 

This section will continue to be updated as we learn more related to the OBBBA. Please continue to return to this page for updates and answers to your questions.

The U.S. Department of Education published final rules on May 1, 2026. We are still awaiting further guidance on some provisions.

Federal Financial Aid Changes

Part of the OBBBA ensures that there is continued funding for the Federal Pell Grant program for the next two years. The Act also created a Workforce Pell program allowing students in some short-term certificate programs to be eligible for the Federal Pell Grant. Oregon Tech does not currently have any programs impacted by this change. 

Beginning in the 2026-27 academic year, the OBBBA also eliminated Federal Pell Grant eligibility for some students. Students who are receiving enough non-federal grants and scholarships to cover 100% or more of their estimated Cost of Attendance and students with a Student Aid Index at least twice the value of the maximum Pell award in the given award year (14,790) will no longer be eligible for Federal Pell Grants.

The OBBBA reduces the number of repayment plan options to a single income-based repayment plan (IBR), repayment assistant plan (RAP), and an updated Standard Repayment Plan. These new plans will begin July 1, 2026 for any new loans borrowed after that date. Current borrowers can also choose to switch to one of the new plans. If a current borrower does not take out any new loans after July 1, 2026 and is on the current standard, graduated, or extended repayment plan, they may keep that plan until they pay off their loans. Any borrower on a current IBR plan can maintain their current plan or switch between other available plans before July 1, 2028. Any outstanding loans utilizing one of the current IBR plans on July 1, 2028 will be converted to the new Repayment Assistant Plan.  

The income-based plan, called the Repayment Assistant Plan or RAP, has varying monthly payments based on the borrower's and their spouse's adjusted gross income (AGI). The rate will be between 1-10% of AGI, but cannot be reduced lower than $10 per month. RAP is a 30 year repayment period and payments made under this plan can qualify for Public Service Loan Forgiveness. RAP also eliminates negative amortization so that a borrower's outstanding debt cannot increase even though they make their monthly payments. 

The new Standard Repayment Plan is a fixed repayment plan over 10, 15, 20, or 25 years based on the total amount of borrowed loans or outstanding debt when opting into the Standard Repayment Plan. Any new loans borrowed after July 1, 2026 will automatically be put into the Standard Repayment Plan unless they choose another option when entering repayment. 

Gainful Employment for All is a new metric placed on institutions to ensure the academic programs a school offers are worth the investment to students. The Department of Education will review the incomes of alumni with undergraduate degrees and high school graduates in similar career fields. If the high school graduate median income exceeds the median college graduate income from a particular degree program for 2 out of 3 years, that individual degree program may lose eligibility to offer Federal Direct Loans to students. Similarly, graduate degree recipients income will be compared to undergraduate degrees in similar career fields. 

Oregon Tech does not anticipate that any of our programs are in danger of failing this metric, but will notify any impacted students if a program fails this metric in any given year. 

The OBBBA establishes that, beginning in the 2026-27 academic year, students enrolled less than full-time and borrowing a federal direct loan will have their loan amount adjusted based on their enrollment. Schools must decrease loan amounts in proportion to the level a student is enrolled less than full-time. This reduction must be done at the time the student's eligibility for the loan is determined. The half-time enrollment requirement to be eligible for federal direct loans is not changed with this rule.

The Grad PLUS Loan program is ending due to the OBBBA. As of July 1, 2026, students will no longer be able to borrow new Grad PLUS Loans. 

However, some students may qualify for legacy provisions if they meet the following requirements:

  1. Began enrollment in a graduate program prior to July 1, 2026 and are continuing in that program
  2. Do not change the graduate program they are enrolled in
  3. Have borrowed Federal Direct Loans for their graduate program prior to July 1, 2026

Students who qualify for legacy provisions may borrow Grad PLUS Loans up until the point they are expected to complete their graduate program or until three academic years have passed, whichever is earlier.

The other change for graduate student borrowers due to the OBBBA is a change to annual and lifetime aggregate loan limits. Effective July 1, 2026, graduate students will be able to borrow up to $20,500 per academic year in Direct Unsubsidized Loans. Also effective July 1, 2026, the lifetime aggregate limit for graduate students will be $100,000 in Direct Unsubsidized Loans. These new aggregate limits do not include loans borrowed as an undergraduate student. These changes also include legacy provisions with the same requirements as outlined above. If a student qualifies for legacy provisions, they may continue to borrow under current lifetime aggregate limits until the point of completing their graduate program or until three academic years have passed. 

Federal Direct Loans for graduate students will need to be adjusted for less than full-time enrollment beginning with 2026-2027 academic year. Schools must decrease loan amounts in proportion to the level a student is enrolled less than full-time. This reduction must be done at the time the student's eligibility for the loan is determined.

The definition for what is considered a professional program and thus eligible for higher loan limits is also changing. 

Oregon Tech does not currently have any programs that will be considered professional programs. 

The OBBBA places annual and lifetime aggregate limits on Parent PLUS Loans effective July 1, 2026. Parents of dependent undergraduate students will be able to borrow up to $20,000 per academic year for their student and up to $65,000 over that student's academic career. These limits apply per student, regardless of how many parents are borrowing. A legacy provision is in place for current parent borrowers to continue to borrow Parent PLUS Loans under the current rules for up to three years, or until their student completes their program, whichever happens first. 

Parent PLUS Loans will not be subject to adjustments for less than full-time enrollment. This is in effect for all eligible students, regardless of their legacy status eligibility. 

Any parent who borrows a Parent PLUS Loan on or after July 1, 2026 will be required to repay all of their Parent PLUS Loan debt through the new Standard Repayment Plan. Debt from a Parent PLUS Loan will also be ineligible for Public Service Loan Forgiveness.