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The Department proposes to address Title IV eligibility issues to remove requirements that unnecessarily target faith-based or for-profit institutions and interfere with efficient and beneficial mergers, sales, and transfers of institutions of higher education. Such issues to be addressed in the context of institutional eligibility for participation of Federal student financial aid include rules governing change of ownership, cash management, administrative capability standards, program length requirements, and financial responsibility requirements. This rule would also remove ultra vires provisions in the Title IV Revenue and Non-Federal Education Assistance Funds regulations called the 90/10 Rule that give public and nonprofit institutions a competitive advantage and update Ronald E. McNair Postbaccalaureate Achievement Program regulations consistent with the December 2, 2025 opinion published by the Office of Legal Counsel at the Department of Justice entitled, "Constitutionality of Race-Based Department of Education Programs,” regarding that program.

Statement of Need:

The rule will address Title IV eligibility issues to remove requirements that unnecessarily target faith-based or for-profit institutions and interfere with efficient and beneficial mergers, sales, and transfers of institutions of higher education.

Summary of the Legal Basis:

The Department is amending portions of its regulations pursuant to title IV of the Higher Education Act of 1965, as amended, codified at 20 U.S.C. 1070.

Alternatives:

Alternatives will be discussed in the notice of proposed rulemaking and final rule.

Anticipated Costs and Benefits:

Anticipated Costs and Benefits will be discussed in the notice of proposed rulemaking and final rule.

Risks:

Risks will be discussed in the notice of proposed rulemaking and final rule.