Major-by-major eligibility

Under current law, once an institution has the required authorization from a state, endorsement from a recognized accreditor, and approval by the federal Department of Education, students may use their Title IV aid for any major that best fits their educational goals.  

However, there is support in both the House and the Senate to limit federal student aid eligibility by major (referred to as program-by-program or programmatic eligibility in legislative proposals) rather than extend it to the entire institution.  Eligibility would be based on the loan repayment rates of students formerly enrolled in those majors. 


The primary repayment metric for removal from participation in the federal student aid programs is the institutional cohort default rate. Should an institution’s cohort default rate exceed the prescribed threshold, the entire institution would lose the ability to participate in the federal student aid programs (Title IV).
Under the program-by-program proposal, every single major, and every college and university in the country, would be scrutinized annually to determine whether the federal government will continue to provide funding to students wishing to enroll in each major. Individual majors that fail to achieve the proposed loan repayment rate would no longer be available to students who receive Title IV federal financial aid. 

Legislative Proposal

One of the key features of the House Republicans’ HEA reauthorization bill (the PROSPER Act) was the inclusion of a major-by-major eligibility proposal for continued participation in the federal student aid programs. In the PROSPER Act, each educational major offered by a college or university would have a loan repayment rate calculated based on the number of former borrowers in “positive repayment status.” For any major that fails to reach the established threshold for even a single year, the institution would be required to submit plans to the Department of Education for approval on methods to raise repayment rates for that major.
The PROSPER Act would have eliminated the cohort default rate as an institutional metric and rely solely on the loan repayment rate for determining continued participation in Title IV.

The House Democrats’ HEA reauthorization proposal (the College Affordability Act) did not include a major-by-major eligibility proposal. However, the College Affordability Act introduces an “adjusted cohort default rate,” loan repayment rates, and instructional spending thresholds which pose new and different challenges to institutional reporting and eligibility for participation in the federal student aid programs. 
Many unresolved questions remain to be answered. In particular, there are many concerns about some common types of students at independent colleges, including transfer students, students who change majors, students who declare majors later in their academic careers, and students who consolidate their loans upon leaving school. These concerns, and others, would pose significant bureaucratic complications at both the institution and the Department of Education as it attempts to interpret statutory directives.

In 2019, the U.S. Department of Education added program-level (i.e. academic major) debt and earnings information to the College Scorecard for the first time. While the Scorecard is touted as a consumer transparency tool, the publication of program-level data could amplify calls in Congress to scrutinize majors and academic programs at colleges and universities. 

Potential Consequences of Major-by-Major Eligibility

Most troubling, is the specter of having majors on campus which are accessible based on wealth.  While the major-by-major eligibility proposal might have a certain logic when applied to job training programs, the concept turns the idea of equal access to higher education for low-income students on its head when applied to individual majors. In effect, students who do not have the means to pay for college would only be eligible to choose certain majors, making equal access regardless of income—the very premise of the Higher Education Act—unattainable.
The effect of this proposal would be chaotic. First, since most students access Title IV funds, particularly at institutions that are serving first generation to college students, once a program is unavailable for Title IV students, it is likely to be discontinued for all students. Even if these programs were made available only to full-pay students, how would eligibility be restored? There would no longer be any Title IV loan borrowers available to earn the institution a passing grade and a pathway back to eligibility.
Finally, at an administrative level, the idea of abandoning certain majors, creating new ones, restructuring faculty hiring to accommodate these changes, and sorting majors by the wealth of the students enrolled would be an unprecedented level of regulatory burden and federal intrusion. Recent work, such as the Recalibrating Regulation of Colleges and Universities report, done under the leadership of the Senate HELP Committee, is one of the few substantive steps ever taken by Congress to undo unnecessary regulation. That work would be seriously undermined by going to programmatic eligibility.
In this regard, the formula proposed in the PROSPER Act of counting as a success all students who are successfully following federal repayment options, is far preferable than less generous formulas being considered by the Senate, which could be based on earnings-to-debt ratios.
Even beyond the importance of service and loan terms and conditions, The College Payoff: Education, Occupations, Lifetime Earnings report by Georgetown’s Center on Education and the Workforce, shows earnings for those with a college degree increase substantially beginning in their mid-twenties. So, while a three-year window may be appropriate for students in job training programs that provide a short-term economic boost, it could hinder those with degrees even though the overall monetary benefit of their degrees is much higher.

In the News


NAICU Washington Update

What You Can Do 

  • Evaluate which majors at  your institution could be harmed by this proposal.
  • Using tailored messaging that reflects the circumstances of your institution, explain to your federal elected officials how this proposal would impact your campus and the students served by your institution.
  • Urge your legislator to oppose determining federal student aid eligibility by individual major.  Ask them to support institution-wide metrics, such as an amended default rate to consider new repayment options, as the means for determining Title IV eligibility. 


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