The One Big Beautiful Bill Act includes a risk-sharing proposal targeting colleges and universities, proposing financial penalties for those whose graduates are burdened with excessive student debt relative to their earnings. Secretary of Education Linda McMahon advocates this approach as a means to increase accountability, suggesting colleges should have 'skin in the game'. The Congressional Budget Office has estimated potential savings exceeding $6 billion over ten years. Programs will be assessed based on their graduates' repayment rates, motivating schools to enhance employment outcomes and reduce reliance on government funding.
The proposed risk-sharing plan aims to hold colleges accountable for their students' financial outcomes by penalizing schools whose graduates struggle with student loan debt.
Colleges would need to reimburse the federal government for unpaid student loans, incentivizing them to produce graduates with better job prospects and earnings.
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