ADVOCACY & POLICY UPDATE - June 16, 2025

House Spending Bills Move Forward as Senate Proposes Student Loan Changes

Washington Update

Reconciliation/Appropriations

Reconciliation

The Senate is expected to release the last piece of their reconciliation package later this afternoon. The GOP tax package was scheduled for release on Friday but was delayed as the Senate Finance Committee continued to work on details for the largest pieces of President Trump’s One Big Beautiful Bill Act — primarily changes to Medicaid and the tax provisions. 

Omissions in the text are still expected once the bill is released, including some specific Medicaid provisions, tax credit phase-outs, and the state-and-local tax decision (SALT), which is a critical issue for USCM. The SALT figure could be included as a lower number or omitted from the draft completely.

FY26 Appropriations

Last week, House lawmakers began consideration of FY26 annual spending bills, starting with the Military Construction-VA, Agriculture-FDA, Homeland Security, and Defense measures, all of which advanced through their respective appropriations subcommittees. Subcommittees will resume their work after a short recess, with the following schedule:

• June 23: Interior-Environment; Financial Services

• June 24: State-National Security; Legislative Branch

• July 7: Transportation-HUD; Energy-Water

• July 14: Commerce-Justice-Science

• July 21: Labor-HHS-Education

  
  

The full Appropriations Committee will take up the bills according to this timeline:

• June 18: Military Construction-VA

• June 19: Agriculture-FDA

• June 20: Homeland Security; Defense

• June 25: Interior-Environment; Financial Services

• June 26: State-National Security; Legislative Branch

• July 10: Transportation-HUD; Energy-Water

• July 17: Commerce-Justice-Science

• July 24: Labor-HHS-Education

  
  

Additionally,Congressman John Moolenaar (MI) is advocating to keep the minimum wage for H-2A migrant seasonal farm workers at its current rate, citing concerns about the impact of rising labor costs on U.S. agricultural businesses. He is seeking to include his Supporting Farm Operations Act in the House appropriations bill this summer.

Senate HELP Committee Reconciliation Bill Text

On Tuesday, June 10, the Senate Health, Education, Labor, and Pensions (HELP) Committee released its higher education reform proposal that aligns with the Trump administration’s efforts to restructure federal student aid and workforce training programs. The plan mirrors key elements of the House’s earlier proposal but includes notable differences, particularly in Pell Grant eligibility and student loan policies.

The Senate bill would end the current federal student loan repayment system, including the Biden-era income-driven repayment plan, and introduce two new options: a standard repayment plan with fixed terms based on debt levels and a new income-based “Repayment Assistance Plan.” The legislation also proposes eliminating the graduate PLUS loan program, replacing it with annual and lifetime loan caps for graduate and professional students. These changes could create space for increased participation by private lenders, particularly in graduate education financing.

While both House and Senate proposals support expanding Pell Grants to short-term workforce programs, the Senate plan maintains current eligibility standards. It does not adopt the House’s restrictions that would make less-than-half-time students ineligible or increase the full-time enrollment threshold - measures that could have affected access for over one million community college students. The Senate proposal includes funding to address a $10.5 billion Pell Grant shortfall but would make students ineligible for Pell if their full cost of attendance is covered by other aid sources. Unlike the House bill, the Senate version does not propose capping undergraduate aid based on institutional cost or repealing gainful employment regulations.

The legislation also repeals borrower defense and closed school discharge regulations but stops short of some of the broader rollbacks included in the House proposal. Overall, the Senate plan reflects ongoing Republican efforts to reduce the federal role in student lending, promote private sector alternatives, and restructure higher education financing and workforce alignment. The proposals are drawing attention from private lenders, who see an opportunity to expand their market presence if federal loan availability is reduced.

Click here to access the full press release, including one-pager and section-by-section summary.

Click here to access the text of the legislation.

Senate HELP Committee Democrats Letter 

On Wednesday, June 11, all Democratic members of the Senate Health, Education, Labor, and Pensions (HELP) Committee sent a letter to its Chair Bill Cassidy (LA) urging the committee to hold public hearings and conduct a formal markup of the budget reconciliation bill before it proceeds to the Senate floor. The request comes amid concerns about the potential impact of the legislation on health care access and outcomes. The letter, led by HELP Committee Ranking Member Bernie Sanders (VT), calls for testimony from patients and health care providers to examine the consequences of the proposed health care provisions. According to the nonpartisan Congressional Budget Office (CBO), the House-passed version of the bill would reduce federal health care spending by over $1 trillion and result in 16 million Americans losing their health insurance.

The letter also pointed to additional projections indicating that the legislation could increase prescription drug costs for seniors, reduce access to care in rural and underserved areas, and weaken patient safety standards in nursing homes. The bill includes provisions to defund Planned Parenthood, reduce funding for women’s health services, and limit access to reproductive health care. Democratic members of the committee argued that the magnitude of these proposed changes warrants a full legislative review process, including public hearings and committee deliberations, before any vote is held.

Click here to access the Democratic letter.

Department of Education/CTE

The Trump Administration is planning a broad restructuring of federal education and workforce programs that includes transferring key responsibilities from the Department of Education and Treasury Department. This includes a plan to move administration of federal career and technical education (CTE) grants — authorized under the Carl D. Perkins Act — from the Department of Education to the Department of Labor (DOL). The proposal also seeks to limit CTE funding to K-12 schools, cutting roughly $400 million annually from programs at community colleges and regional CTE centers. There have also been discussions about moving the federal student loan portfolio — worth $1.6 trillion — to the Treasury Department or the Small Business Administration. While Secretary of Education Linda McMahon has acknowledged that Congress must approve any formal closure of the department, the Administration continues to explore shifting major functions to other agencies.

These changes were outlined in court filings amid legal challenges from states opposing the department’s restructuring. A previously undisclosed interagency agreement signed in May 2025 would shift control of up to $2.7 billion in CTE and workforce funds to DOL’s Employment and Training Administration (ETA), although the Department of Education would retain formal ownership of the funds and reimburse DOL for administration costs.

An additional agreement, finalized in April 2025, detailed Department of Education staff to the Treasury Department to support federal student loan collections. This followed the collapse of a private loan collection contract and staff reductions at the agency. The administration’s stated goal is to streamline operations, improve coordination across agencies, reduce administrative burdens on states, and enhance responsiveness to labor market needs. Federal officials have discussed integrating CTE and Workforce Innovation and Opportunity Act (WIOA) programs and using new technologies, including AI, to improve program delivery and performance. However, implementation of these plans is currently on hold following a March 2025 federal court injunction that blocked large-scale staff reductions at the Department of Education. The court found that the layoffs constituted an attempt to dismantle the agency without congressional authorization. The Administration has appealed the ruling to the Supreme Court.

Click here to access the status update in New York’s lawsuit challenging President Trump’s efforts to dismantle the Department of Education.