Fall 2026 Federal Higher Education Policy Outlook

​​As the 2026 midterm elections approach, Congress has a limited window to act on major higher education priorities.

At the same time, federal agencies are continuing to implement major policy changes that affect everything​ from student borrowing and accreditation to research funding and international enrollment.

Among the issues to watch:

​LEGISLATION

FY 2027 Appropriations and Fe​deral Funding ​

Congress returns in September with fiscal year 2027 funding unfinished, setting up another compressed appropriations fight over education, research, student aid, and other domestic programs.

The immediate priority will be preventing a government shutdown before the current fiscal year ends on Sept. 30. Before leaving Washington, the House and Senate approved competing continuing resolutions that would temporarily extend government funding while lawmakers continue negotiations on full-year appropriations bills.

The Senate-passed measure​ would continue funding through Dec. 11 and includes language temporarily blocking the Office of Management and Budget from finalizing its controversial proposed revisions to the Uniform Guidance, the government-wide framework governing federal grants and cooperative agreements. ACE and other higher education organizations have argued that the proposal would fundamentally alter how grants are awarded, administered, and terminated by increasing political oversight of grantmaking decisions and expanding federal authority to terminate awards.

The House bill would run through Dec. 4 and doesn't contain the Uniform Guidance provision. President Trump has come out in support of the Senate version.

Beyond the continuing resolution debate, Congress must still complete work on FY 2027 appropriations bills.

The House Labor-HHS-Education spending bill illustrates the difficult choices ahead. The legislation would reduce Department of Education funding by roughly 10 percent while providing a modest $50 increase in the maximum Pell Grant award. It would also preserve NIH funding levels rejected in the administration's earlier proposal while significantly reducing funding for Federal Work-Study, Supplemental Educational Opportunity Grants, and the Institute of Education Sciences. The Senate has yet to release its bill.

College Sports

​The Senate is expected to take up the bipartisan Protect College Sports Act soon after lawmakers return in September. The legislation, sponsored by Sen. Ted Cruz (R-TX) and Sen. Maria Cantwell (D-WA), would establish a federal framework governing name, image, and likeness (NIL) compensation, athlete transfers, revenue sharing, and other aspects of college sports administration. The Senate Commerce Committee approved the bill in June, but the full Senate did not vote on it before the August recess.

The legislation seeks to create a national set of rules for college athletics in response to years of litigation, state-level NIL laws, and the rapidly evolving post-Alston and post-House v. NCAA landscape. The bill would preserve student-athletes' ability to earn NIL compensation while allowing athletic associations to regulate compensation, eligibility, recruiting, transfers, and related conduct. It would also preempt many conflicting state laws and provide targeted antitrust protections for national athletics rules. Notably, the legislation does not address whether student-athletes should be classified as employees. For a full summary, click here.

Veterans Education and Benefits

The Take Care of America's Veterans Act​ (H.R. 9237/S. 4744) would make several changes affecting veterans pursuing postsecondary education and workforce training, including expanded opportunities for apprenticeship and on-the-job training programs and greater flexibility related to licensing, certification, admissions, and credit-by-examination policies. For colleges and universities that serve military-connected students, the legislation could streamline access to educational benefits and reduce administrative barriers.

Despite bipartisan interest in improving veterans' services, the bill's future remains uncertain.

​​Department of Education

The Department of Education enters the fall at the center of the administration's efforts to reshape federal higher education policy through regulation, enforcement, guidance, and grant administration, even as congressional Republicans continue pursuing proposals to transfer some of the department's functions to other federal agencies.

Student Aid and Workforce Pell: Implementation of the department's July 1 student aid changes remains a major focus, including new borrowing limits, changes to Graduate PLUS and Parent PLUS loans, and revised repayment options. Questions surrounding the department's definition of professional degrees and ongoing litigation continue to create uncertainty for institutions and students. Workforce Pell has also moved into implementation following publication of the final rule in May, with colleges evaluating program eligibility, state approval requirements, reporting obligations, and performance benchmarks. The department has indicated it will carry out further negotiated rulemaking activities in the fall around Title IV student aid programs.

Program-Level Accountability: The department's new earnings-based accountability framework represents a significant shift in how academic programs are evaluated for federal aid eligibility. The rule takes effect in 2027 and could ultimately affect aid eligibility for programs that fail to meet earnings benchmarks. ACE and other higher education organizations have raised concerns about the metric's reliance on earnings data and its potential impact on institutions serving low-income and historically underserved students.

Accreditation: The department is expected to release proposed regulations this fall stemming from the AIM negotiated rulemaking process. The proposal could reshape accreditation standards, transfer policies, institutional oversight, and accreditor recognition, with final regulations potentially taking effect in 2027. ACE is encouraging institutions to review the proposal closely and participate in the public comment process.

Homeland Security and State Department