Federal Update - October 7

October 7, 2026

GOVERNMENT RELATIONS HIGHLIGHTS

Another Pocket Rescission: President Trump rescinds $810 million  

Senate Joins the House at Home: Congress set to return November 9  

ED Updates FVT/GE Data: Institutions have until January 2027 to update 

ED Distributes Fiscal Year 2023 CDR Rates: Webinar on Default Prevention Scheduled 

DEEPER DIVE: ED Recodifies 2020 Title IX Rules 

PRESIDENT TRUMP WITHHOLDS APPROPRIATED FUNDING

What You Need to Know 

Last week, President Trump announced plans to withhold approximately $810 million in funding appropriated by Congress through a process known as a "pocket rescission." The proposed cuts target programs the Administration has deemed inconsistent with its priorities, including initiatives supporting non-citizens and DEI efforts. 

Why This Is Important  

Among the programs affected are roughly $70 million for international student and faculty exchange programs and approximately $25 million for ED's Special Programs for Migrant Students. The move has already reignited debate over the extent of the President’s constitutional authority to withhold congressionally approved funding. While the Supreme Court permitted a similar action to proceed in 2025 as litigation continued, the broader constitutional questions remain unresolved. New legal challenges to the latest funding freeze have already been filed. 

LAWMAKERS HEAD HOME FOR MIDTERMS

What You Need to Know 

Last week, the Senate concluded its work in Washington and headed home for the final stretch of the midterm campaign season. Polling and election forecasts continue to suggest Democrats are well positioned to take control of the House, while control of the Senate remains less certain. 

Why This Is Important 

Congress will return on November 9 and will face a crowded agenda and compressed timeline. At the top of the list will be completing FY2027 appropriations. Although the fiscal year began on October 1, lawmakers passed a continuing resolution in September extending current funding levels through December 11 and postponing broader funding decisions until after the election. As a result, the lame duck session is expected to be one of the busiest of this Congress, with a growing list of unfinished business that needs to be addressed before the end of the year. 

ED UPDATES THE FVT/GE REPORTING SPREADSHEET

What You Need to Know 

Earlier this year, ED published a spreadsheet indicating the FVT/GE data files that are missing from institutions’ previous reporting requirements submissions. On September 25, ED once again published the spreadsheet, updated to remove institutions that have now fulfilled reporting requirements. Institutions with missing or incomplete data have until January 15, 2027 to submit or complete their historic data.  

Why This Is Important 

The Department reported that approximately 1,550 institutions have not reported or underreported the FVT/GE reporting data from the 2024 and 2025 cycles (i.e., the data that was due to ED by September 30, 2025 and October 1, 2025, respectively).The Department stated the agency intends to review submissions for completeness and may eventually take adverse action against institutions that fail to timely comply by January 15. AACS has been in close touch with the Department about the filing of this data, and members should expect continued communications about delinquent data submission. 

ED DISTRIBUTES FISCAL YEAR 2023 CDR RATES

What You Need to Know  

On September 28, ED distributed fiscal year 2023 official cohort default rate notifications to all Title IV-eligible schools. Two days later, ED publicly released the rates. Since fiscal year 2020, the official national cohort default rate has been 0.0%, due to the pandemic-era pause on student loan repayment requirements. As a result of the pause, no borrowers with federal student loan debt entered default. The national cohort default rate for fiscal year 2023 is 0.4%.   

Why This Is Important  

ED stated that the pandemic-era pause, which applied to most repayment during fiscal year 2023, may “provide an overly favorable picture of borrower repayment outcomes[.]” The cohort default rates for fiscal year 2024 are expected to offer a more accurate view of borrower repayment outcomes post-repayment pause. On October 13, from 1:15-2:15 ET, ED will host a webinar entitled, “Default Prevention: Institutional Strategies for Success.” ED states that the webinar will address the interaction between cohort default rates and Title IV eligibility and will provide resources to schools working to encourage borrower repayment. Institutions can register to attend here, and AACS encourages all members to participate.

DEEPER DIVE: ED RECODIFIES 2020 TITLE IX RULES

What You Need to Know 

The Title IX regulations have had a bumpy few years. In 2020, ED substantially amended the regulations to include new requirements for how institutions must respond to sexual harassment. Then, in 2024 under the Biden Administration, ED published a new final rule that substantially revised the 2020 regulations. However, the 2024 rule had a short life. It was challenged in court almost immediately, and two courts issued final judgments that vacated the rule entirely. 

ED subsequently announced in early 2025 that it would no longer enforce the 2024 rule and would instead expect institutions to comply with the 2020 rule. Even so, the official text in the Code of Federal Regulations still showed the vacated 2024 rule. The Department described this mismatch as an “ambiguity and a source of potential confusion” for institutions, courts, and the public. Accordingly, on September 29, 2026, the Department published a final rule, “Recodification of Title IX Rules,” in the Federal Register. The rule formally repealed the 2024 Title IX rule and put the 2020 rule back into place, thereby bringing the official text in line with the rules ED is actually enforcing. It took effect immediately on publication.  

However, ED did not reinstate the 2020 rule word for word. It made four “minor changes,” most of which simply remove long-passed compliance deadlines. The only change of real substance is the removal of the cross-examination exclusion, which barred decisionmakers from relying on any statement by a party or witness who did not submit to cross-examination at a live hearing. A federal court vacated that sentence in Victim Rights Law Center v. Cardona in 2021, and ED stopped enforcing it in August 2021. Like the rule as a whole, this change only brings the regulatory language in line with current practice. 

Why This is Important 

In practice, the recodification should have little day-to-day effect because institutions have been operating under the 2020 rule since at least early 2025. ED says the rule “effects no change of current substantive law” and “does not subject recipients to new obligations.” The main benefit is clarity: institutional policies, training, and the regulations should now all say the same thing. AACS encourages members to use the recodification as an opportunity to revisit their Title IX policies, procedures, and posted training materials to ensure they comply with the current text of the regulations.