The Department of Education released the third and final set of proposed regulations related to the One Big Beautiful Bill Act for public comment on April 20, 2026. The centerpiece of the new rules is an accountability metric designed to measure the return on investment of every degree program at more than 4,000 colleges and universities. Under the proposed framework, undergraduate programs would be required to demonstrate that their average graduate earns more than a working adult whose highest credential is a high school diploma. Programs that cannot meet that threshold would face potential loss of federal financial aid eligibility.
The rule is framed as consumer protection. Education Under Secretary Nicholas Kent described it as a measure to ensure students are not borrowing money for degrees that do not produce economic returns. Seventy percent of undergraduate students rely on federal financial aid to finance their education, which means a program losing federal eligibility would effectively become inaccessible to most of its current students. The administration's position is that this creates accountability pressure on institutions to either improve wage outcomes for graduates or eliminate programs that are not delivering measurable economic value.
Critics of the proposed rule have raised several objections. The first is that wage outcomes in the years immediately following graduation do not capture the full value of a degree. A social work degree from a small regional college, or a teaching credential at a liberal arts institution, may produce graduates earning below the high school comparator threshold five years out while producing essential workers in communities that have no other source of qualified professionals. The rule does not distinguish between programs producing graduates who are underemployed because the degree has no market value and programs producing graduates who are underemployed because the careers they chose have structural wage suppression despite social necessity.
The second concern is about which institutions and which students bear the most risk. Programs at well-resourced universities with strong alumni networks, established career placement infrastructure, and graduate school pipelines will perform better on wage metrics than programs at smaller regional colleges that serve first-generation students, rural communities, or working adults returning to school later in life. The metric as proposed does not adjust for the socioeconomic background of incoming students, the labor markets they return to after graduation, or the wage penalty associated with career sectors that serve predominantly low-income communities. The accountability burden falls most heavily on the institutions whose students have the fewest alternatives.
The timing of the proposed rule lands against a background of significant financial stress in higher education. A projection published by Huron Consulting Group this month estimates that 442 private nonprofit colleges are at risk of closure or merger within the next ten years. Hampshire College in Massachusetts announced this month it will close by end of 2026. Sterling College in Vermont closed in March. Institutions that are already financially vulnerable and serving students with limited economic options are now being asked to demonstrate wage outcomes that their student demographic may not achieve in the first years of a public service or care economy career.
The Department of Education indicated it is committed to finalizing the regulations despite concerns raised during the public comment process. An accreditation negotiated rulemaking session in early April saw department officials respond to questions about the impact on vulnerable institutions by affirming that reform is the goal, not preservation of the status quo. The public comment period will determine how much of the opposition language makes it into the final rule, but the administration's posture suggests the core metric will survive the process.
Congress is watching the rulemaking with divided attention. Democrats have pushed back on the accountability framework as designed, arguing it sets conditions that will trigger loss of federal funding at the institutions least capable of absorbing the shock. Republicans supportive of the administration's approach have argued that federal aid should not flow to programs that demonstrably fail to produce economic returns for the students who enroll in them. The underlying debate is about whether higher education is primarily a market product whose value should be measured in earnings, or a public good whose value includes social and civic dimensions that wage data does not capture.
The proposed regulations are open for public comment through early June 2026. Final rules are expected to be issued later in the year, with an implementation timeline that gives institutions a window to adjust programming before losing eligibility. The window for comment is the best opportunity for institutions, students, and advocacy organizations to put alternative metrics and exemptions on the record before the final language is set.