Federal Update - April 22

April 22, 2026

GOVERNMENT RELATIONS HIGHLIGHTS

Reconciliation 2.0: Senate Begins Process for DHS Funding 

House Advances WIOA Reauthorization: Bipartisan Path Unclear

Fed Nomination Complication: Confirmation Faces Committee Roadblock 

AIM Rulemaking Progresses: First Session Highlights Sharp Divisions 

FAFSA Fraud Detection Expands: Real‑Time Screening Launches April 26 

DEEPER DIVE: ED Issues Proposed Rule on Accountability Framework 

RECONCILIATION 2.0 TEED UP IN SENATE

What You Need to Know 

Congress is moving ahead with a two‑track plan to resolve funding for the US Department of Homeland Security (DHS). Under this approach, the House would pass a bill funding most DHS operations, while Senate Republicans separately pursue funding for the rest of DHS’s functions (i.e., ICE and Customs and Border Protection) through the budget reconciliation process. The next step is expected this week when the Senate votes on a budget resolution. Notably, the resolution does not direct any other committees to contribute language, signaling an effort to keep the bill narrowly focused on DHS. Once both the House and Senate adopt the budget resolution, Republicans would be able to advance a reconciliation bill using a simple majority vote in the Senate. 

Why This Is Important 

While GOP leaders have emphasized a narrow approach, extremely tight margins heighten the risk that additional policy or funding provisions could be added to secure critical votes. Some House Republicans have already pushed for a greater role in shaping the reconciliation bill, raising questions about whether the package could expand. That said, if the Senate limits instructions in the budget resolution, it restricts what can be added later in the process. Because budget reconciliation has been used previously to enact major changes to education programs, including OB3 last year, AACS will continue monitoring developments closely and flag any provisions that may affect our community. 

HOUSE COMMITTEE CONSIDERS WIOA

What You Need to Know 

Congress last reauthorized the nation’s primary workforce development law, the Workforce Innovation and Opportunity Act (WIOA), in 2014, when a politically divided Congress passed the measure with broad bipartisan support that President Obama signed it into law. Since then, multiple attempts at reauthorization have stalled. Most recently, Congress included a bipartisan WIOA reauthorization in a December 2024 funding deal, which collapsed after opposition from then President‑elect Trump. Restarting the process, the House EdWorkforce Committee passed a partisan reauthorization bill on Tuesday, now titled the Stronger Workforce for America Act of 2025. While the bill mirrors elements of the 2024 bipartisan proposal, it includes some provisions likely unacceptable to Democrats. These include codifying the Trump Administration’s plan to transfer oversight of workforce programs from ED to the US Department of Labor, along with significant funding reductions across most WIOA programs.

Why This Is Important 

With midterm elections approaching fast, the bill’s prospects from here are murky. The Senate HELP Committee, led by Chairman Bill Cassidy (R‑LA) and Ranking Member Bernie Sanders (I‑VT), has shown less enthusiasm for pursuing a comprehensive overhaul than House lawmakers. Instead, Senator Cassidy has favored narrower, piecemeal workforce legislation. That said, Congress is expected to return during the lame duck session to address must‑pass funding legislation. As in 2024, a renegotiated WIOA compromise could ultimately be attached to a broader funding package, creating another opportunity for enactment.

FED CHAIR NOMINEE FACES CONFIRMATION HEARING

What You Need to Know 

On Tuesday, Federal Reserve Chair nominee Kevin Warsh testified before the Senate Banking Committee, emphasizing the Fed’s independence from the White House. President Trump nominated Warsh, a former Federal Reserve governor, earlier this year to replace current Chair Jerome Powell. Powell has been a frequent target of criticism from President Trump over interest rate policy, and the US Department of Justice has opened an investigation into Powell related to renovations at the Federal Reserve’s Washington campus. Those actions have added political tension to the confirmation process. 

Why This Is Important 

While Warsh is expected to receive broad Republican support and could attract some moderate Democrats on the Senate floor, his nomination faces a major hurdle in committee. Senator Thom Tillis (R‑NC), a member of the Senate Budget Committee who is retiring, has publicly opposed what he views as political pressure on the Federal Reserve and has declined to support advancing the nomination until the investigation of Powell is dropped. Without Tillis’s vote, the committee could deadlock, delaying a full Senate vote. As a result, Chair Powell could remain in office until the investigation concludes or a compromise is reached. 

AIM RULEMAKING SESSION ONE WRAPS

What You Need to Know 

On April 17, negotiators concluded session one of the Accreditation, Innovation, and Modernization (AIM) negotiated rulemaking committee. AIM negotiators walked through ED’s 151-page draft regulations, in some cases engaging in spirited and politicized discussion of the language. Key topics included, among other things, accreditor standard updates that would require academic freedom protections to extend to faculty regardless of viewpoint; a requirement for accreditor internal controls to ensure accreditor compliance with antitrust laws; revisions to accreditor substantive change processes; and ED discretion in revoking Title IV-eligibility in the event an accreditor made an error in rendering an adverse accreditation decision.  

Why This Is Important 

ED made minor changes to the draft language over the course of the week based on the negotiations, but these changes were largely structural, rather than substantive. Whether the committee will achieve consensus at the conclusion of session two remains to be seen. In the absence of consensus, ED would be free to craft a proposed rule as the agency chooses. If the committee reaches consensus, ED would be bound to adopt the consensus language for purposes of the proposed rule. 

FRAUD DETECTION UPDATE TO FAFSA FORM

What You Need to Know 

According to an April 15 Electronic Announcement, beginning April 26, the FAFSA form will include an imbedded “real-time fraud detection capability.” The automated screening will sort applicants into fraud risk categories. The Electronic Announcement does not appear to clarify the sorting criteria. Those in the “high-risk” category will be asked to confirm their identity by presenting government-issued identification live, on camera, via a mobile or tablet device. ED will also screen all previously submitted 2026–27 FAFSA forms using the automated system. This evaluation will be based on data already provided to ED, with no additional interaction required by applicants. 

Why This Is Important 

This Electronic Announcement is the latest in ED’s continued attention to fraud detection, as further detailed in June and August 2025 Electronic Announcements, which highlight the issue from ED’s perspective. In ED’s view, these efforts are “driven by the need to respond to the significant scale of recent fraud activity[.]”

DEEPER DIVE: ED ISSUES PROPOSED RULE ON ACCOUNTABILITY

On Monday, ED issued the “Student Tuition and Transparency System (STATS) and Earnings Accountability” notice of proposed rulemaking (NPRM), which follows the AHEAD Committee’s negotiated rulemaking sessions completed earlier this year. The AHEAD Committee was tasked with developing draft regulations to implement the changes to the Pell Grant program and the new accountability measures adopted by Congress in OB3 that President Trump signed into law on July 4, 2025.  Because the Committee achieved consensus, meaning that no negotiators objected to the proposed draft, ED was obligated to issue an NPRM that advances the consensus language. 

The AACS membership and other interested parties by now are familiar with the concerns raised by the NPRM. Notably, in OB3, Congress directed ED to develop accountability regulations for undergraduate degree programs, graduate degree programs, and graduate certificate programs, but it pointedly excluded undergraduate nondegree programs. ED nevertheless has extended the new accountability framework to include undergraduate certificates, like most cosmetology, barber, and wellness programs. ED’s data suggests that nearly all such programs are projected to fail the accountability framework’s requirements, with the significant majority of programs facing the potential loss of Title IV eligibility and continued viability. 

If implemented as drafted, the NPRM would compare the median earnings reported by a program’s working completers 3-4 years after graduation with the median earnings of all working adults aged 25-34 holding just a high school diploma in either the state where the school is located or, in some cases, nationally. As a result, the framework would establish the same comparative earnings expectation for a 1,000 hour undergraduate cosmetology certificate as a bachelor’s degree program in an advanced and highly-compensated field.   

The NPRM also fails to account for well-known weaknesses in earnings reported for cosmetology, barber, and wellness program completers. The NPRM provides no adjustments for wage discrimination in fields predominated by women and minorities as compared to the total adult workforce; no accounting for the disproportionate rate of part-time employment in the cosmetology, barber, and wellness industries; and no solution for the problem of un- and under-reported income arising from cash transactions and tips. 

Finally, the NPRM fails to account for earnings disparities within a state. Median earnings for completers from most schools located in rural and exurban regions will be compared with earnings reported for all working adults statewide. In states where large urban and higher-wage jurisdictions skew statewide data, the rural school and its completers suffer from this structural disadvantage, which the NPRM does not address. 

The NPRM provides that programs that fail the NPRM’s earnings accountability test in one year must issue warning notices to students. Any program that fails the test in two out of three consecutive years is deemed a low earning outcome program and would lose eligibility for Direct Loans. A program that is deemed a low earning outcome program in two out of three consecutive years would lose all Title IV eligibility, including Pell Grants. 

All comments to the NPRM must be submitted to ED through the regulations.gov portal no later than May 20. ED must review the comments and will either modify the regulations as a result of the comments or explain why it chose not to do so.  Final regulations are expected to be issued by the end of June for implementation on July 1, 2027, other than select provisions that Congress mandated become effective as of July 1, 2026. 

AACS urges all members to submit thoughtful comments that challenge the NPRM and to offer constructive alternatives. We must mobilize as a community to have our voices heard.