Introduction by Barbara K. Mistick

Dear Colleagues,

For several weeks I have been writing about, and Washington Update has been reporting on, the lengthy Congressional reconciliation process. Now, finally, we could be nearing the end of the line as the Senate is aiming to begin voting on its package in the coming days with final passage possibly by mid-next week.

Earlier this week, I sent a letter to Senate leadership expressing NAICU’s opinions and recommendations on the proposed higher education provisions in the Senate reconciliation bill. Additionally, I sent an Action Alert yesterday requesting engagement on one more advocacy push with your elected officials. 

This is likely to be our last major opportunity to affect change in the reconciliation language in the House and Senate. Please use the talking points in the Action Alert and the suggested bill improvements in my letter to ensure that our sector’s concerns are conveyed to your Senators and Representative.

Once the bill passes in the Senate, negotiations will begin with the House where the process could get murky. Under one option, negotiations can begin between the House and Senate to hammer out the differences between their bills to reach a compromise proposal, though any compromise would once again be subject to Byrd Rule interrogation in the Senate, which would slow down the legislative process considerably. Alternatively, the Senate could try to force the hand of the House by urging it to simply pass the Senate bill as written given the time and energy that has gone into crafting it. This, however, poses problems for the House, which has policy disagreements with the Senate on several significant issues.

Either way, with the pending August recess and the debt ceiling as targeted end dates, there will be motivation in Congress to wrap up its work as quickly as possible.

As it relates to higher education, the Senate parliamentarian has ruled that proposed reforms to the student loan repayment programs and the expansion of Pell Grants to short-term workforce credential programs are out of order. As of Thursday evening, we are still waiting on rulings related to the endowment tax.

Once the parliamentarian rules, the big question becomes what changes need to be made to the Senate bill in order to capture the savings needed to fund the tax cuts contained in the legislation.

NAICU will continue to provide updates as the final stages of the process unfold.

Soundbites

• NAICU Urges Appropriators to Reject President’s Budget. In a letter to members of the House and Senate appropriations committees, NAICU and the Student Aid Alliance urged policymakers to reject the President’s FY 2026 budget request for the student aid programs. The administration proposes to substantially cut the Pell Grant award maximum, eliminate Supplemental Educational Opportunity Grants, TRIO, and GEAR UP, and drastically reduce Federal Work-Study funding.

• FAFSA Updates. The Department of Education announced two enhancements to the Free Application for Federal Student Aid (FAFSA) process and a beta testing timeline for the 2026-27 application cycle. The enhancements include real-time identity verification, which should shorten processing time by up to three days, and a simplified contributor invite process, which should alleviate some of the technical issues students have encountered when requesting contributor information. Beta testing will begin on August 4, and schools may receive intermittent institutional student information records once that begins.

I hope you have a pleasant weekend,

Regards

Barbara

Barbara K. Mistick, D.B.A.
President, NAICU

For more information, please contact:
Barbara K. Mistick, D.B.A.