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Fast-Tracked Rulemaking
Consensus on Pell and Workforce Pell
The negotiated rulemaking committee tasked to draft rules for the Pell Grant program reached consensus on regulatory text and did so within a five-day timetable experts considered too short to fully address legal and technical concerns.
Under the proposed rules, the grant would not be applied before awards from non-federal sources. If students have other scholarships, they would be applied first. If they cover or exceed the full cost of attendance, eligibility for Pell would be lost. However, if the non-federal aid falls short of the full cost of attendance, eligibility remains active and the Pell Grant can be applied before the other aid.
The negotiators also drew up the rules for Workforce Pell programs. While many issues around how performance will be assessed and the role of the states in tracking outcomes, still need to be addressed, the basic rules are in place. Notably, a program must have existed for at least one year and meet length, industry demand, state approval, and completion and employment requirements. Additional rules will be forthcoming in the next round of rulemaking negotiations scheduled for January 5, 2026. The documents and videos from this round are available for review.
Cost Concerns Remain
The way the Pell Grant is funded makes it vulnerable to shortfalls. Earlier this year the Congressional Budget Office provided an overview of how it is structured and how shortfalls are handled. In the past Congress propped up the program by appropriating additional mandatory funding, reducing the program's discretionary funding, curtailing eligibility, and supplementing discretionary funding.
Experts predict expanding the Pell Grant program to include short-term training will accelerate depletion of its reserves. The One Big Beautiful Bill Act (OBBBA) provided funding to prevent that from happening through 2026. However, if structural issues are not addressed, a shortfall may occur later.
Consensus on Student Loans
The negotiated rulemaking committee convened to iron out specifics of federal student loan regulations also reached consensus in five days. Under the terms of OBBBA, loan amounts for graduate programs are capped. Students enrolled in a program not designated as a professional degree program can borrow no more than $20,500 annually and no more than $100,000 total. Students enrolled in a program designated as a professional degree program can borrow up to $50,000 annually with a limit of $200,000.
The committee came under fire for naming only ten programs as professional degree programs: pharmacy, dentistry, veterinary medicine, chiropractic, law, medicine, optometry, osteopathic medicine, podiatry, and theology. Although OBBBA listed those ten as examples, it did not stipulate that the list be restricted to them. Negotiators indicated that they feared legal challenges should they expand or contract the list.
Anticipating the impact of the cap, organizations representing nurses, accountants, architects, engineers, social workers and business administrators criticized the list for including so few professions. In a letter to the Department of Education (Department), a bipartisan group of legislators requested expansion of the list of professional degrees to include nursing. They noted that some certified nursing degrees cost far more than the cap allows. The Department did not add nursing but did agree to add clinical psychology. The consensus draft and other documents from the sessions are available for review.
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Wider Travel Ban
A presidential proclamation that expanded the US entry restrictions to cover 20 more countries, including Nigeria, may have a negative impact on higher education. Nigeria is one of the top countries international students call home. Last year over 20,000 Nigerian students were enrolled here. Experts say the proclamation is based upon faulty data. Exemptions from the ban include current visa holders, certain athletes, diplomats, and others whose entry serves national interests.
Warning Label Added to Financial Aid Application
The Department announced an update to the Free Application for Federal Student Aid (FAFSA) online. A warning label will be visible to prospective first-year students who indicate interest in an institution whose graduates’ earnings fall beneath the median earnings of high-school graduates in the same state. The Department is using data from the College Scorecard to determine earnings four years after graduation. Applicants will be given the option to change their selection or leave it as is. The Department stressed that the notice has no impact on eligibility for federal financial aid. Critics say the Department did not perfect the tool before launching it.
Student Loan Delinquency
Experts warn of a looming default cliff that could impact millions of borrowers. They warn that the Department may not have the resources to support borrowers. When in default, the entire unpaid balance becomes due and the borrower loses eligibility for deferment, forbearance, and forgiveness. OBBBA eliminated deferment and forbearance options for borrowers who are unemployed or facing economic hardship.
Loan Litigation Reaches Settlement Phase
The Department announced it reached an agreement to end the Saving on a Valuable Education plan (SAVE)—an income-driven federal student loan repayment plan. Under the terms of the joint settlement, the lawsuit will be dismissed in exchange for the Department agreeing to halt enrollment, deny pending applications and transfer those enrolled in SAVE to other repayment plans. The agreement requires court approval.
K-12 Charter School-HBCU Collaboration
Bloomberg Philanthropies, City Fund, and UNCF have moved forward with a plan to foster partnerships between public charter schools and HBCUs. The first public charter-HBCU partnership in Alabama recently opened on the campus of Stillman College. Another is slated to opened near Tuskegee University next fall. The charter schools’ affiliation with and proximity to the HBCUs ensures students have several dual-enrollment and internship opportunities. Michael Bloomberg, billionaire philanthropist and former mayor of New York and City Fund each donated $10,000,000 to the initiative.
Negative Outlook for the Sector
Prominent credit ratings agencies, S&P Global Ratings, Moody’s Ratings, and Fitch Ratings, announced negative forecasts for US nonprofit colleges and for the US higher education sector in general. They cited enrollment challenges, changes impacting international students and workers, increased endowment tax, reduced research funding, reduced availability of student loans, demographic challenges, and the negative impact of the Trump administration’s policies. Growth in revenue is expected to slow and be outstripped by expenses.
Federal Judge Enjoins Task Force from Freezing University Funding
US District Judge Rita Lin blocked the multi-agency Task Force to Combat Anti-Semitism from freezing the University of California’s research funding or circumventing administrative procedures during its civil rights investigation. As the class-action lawsuit moves forward, the task force is prohibited from using the investigation to justify freezing research funding, levying unrelated fines, forcing unrelated policy changes, or attempting to shutter DEI initiatives. It is ordered to follow the applicable rules, regulations, and established procedures.
University of California System Update
In a lawsuit, brought by the University of California System against the Departments of Defense, Transportation, and Health and Human Services over termination of grants, US District Court Judge Rita F. Lin found the cancellations violated the Administrative Procedure Act and lacked adequate specificity and rationale. She ordered restoration of grants already cut and prohibited the agencies from terminating additional grants without a grant-specific explanation.
Programs and Protections Under Fire
The Robert D. Bullard Center for Environmental and Climate Justice at Texas Southern University released Green Light to Pollute in Texas: Proposed Buildout of Petrochemical Facilities Targets Most Vulnerable Communities, Again. Despite the center’s findings, the Department of Justice (DOJ) issued a final rule revoking use of the disparate impact standard. Rather than use statistical analysis to block harmful housing, policing, and environmental policies, the agency will pursue cases where harm results from disparate treatment. The shift from requiring proof of harm to requiring proof of intent to harm is in accord with an executive order issued in April.
DOJ's new approach comes after an internal shakeup that decimated the agency’s civil rights division. In an open letter, former employees warned that in its current state the agency is no longer protecting civil rights and no longer able to perform competently. Also under attack is the rebuttable presumption of disadvantage. Initially used by the Small Business Administration’s (SBA) 8(a) Business Development program, the standard was adopted by many other federal agencies to facilitate the participation of women and minorities. SBA has become a target of groups seeking to purge federal agencies of diversity, equity, and inclusion initiatives. The DOJ considers the standard unconstitutional and has declined to defend agencies facing lawsuits.
Researchers Grapple with Open Access Fees
A Biden administration policy set to go into effect on December 31, 2025, requires researchers to make their articles publicly available once they have been accepted for publication. The Trump administration opted for early adoption of the policy but it has also decimated research funding. To further complicate matters, the most popular journals impose hefty fees to make the articles publicly available. Some agencies have attempted to limit the amount of an award that can be used to pay such fees. Researchers report being torn between using research funds to pay article processing charges, using them to support their work, or using them to maintain personnel.
HBCUs Volunteer to Sign Compact
No HBCUs or MSIs were included in the group of universities that were invited to sign a compact with the Department. The Compact for Academic Excellence in Higher Education offered priority access to federal funding in exchange for compliance with a list of terms. None of the invitees signed, although Vanderbilt University and the University of Texas at Austin were reported to be willing to provide feedback. The majority of faculty, students, and organizations opposed signing. Since then two HBCUs—Oakwood University and Saint Augustine’s University, have expressed interest in signing a version of the compact provided it was altered to permit consideration of race and other details that conflict with their mission.
Canada Woos Foreign Researchers
While the US continues to push out foreign talent, Canada has moved to attract it. The Canadian government is seeking to replace the US as a destination for highly skilled researchers, scientists, doctors, and other experts. Top Canadian universities are recruiting researchers employed in the US and plan to deploy a pipeline dedicated to US H-1B visa holders. Driven by immigration restrictions and a hostile atmosphere, foreign student enrollment in US institutions declined by 17% in the fall 2025.
Private Equity Gains Foothold
The University of Utah is moving forward with a plan to partner with a private equity firm to create Utah Brands & Entertainment LLC. The partnership will give the new company access to cash to meet the demands of its athletic department amid revenue sharing and NIL pressures. Pundits have long anticipated private equity firms were positioning themselves to provide athletic departments funding and management expertise.
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Southern University
Southern University System Board of Supervisors is moving forward with plans to decouple the roles of chancellor and president. To manage the fallout from massive cuts made under then-governor Bobby Jindal, the positions were consolidated in 2015. The Board of Supervisors has asked the current president and chancellor, Dennis Shields, JD to step down. He will take a sabbatical before returning to the institution as a professor of law. Shields, JD took the reins from Dr. Ray L. Belton, who retired in 2022. An interim president will be named soon.
Allen University
Allen University Board of Trustees named Dr. Stanley Pritchett, Sr. interim president. He takes the reins from Dr. Ernest McNealey, who served for almost a decade.
The Department of Education
The Department announced the appointment of Mr. Robert Eitel, Mr. Joshua Figueira, Dr. Jay Greene, Dr. Steven Taylor, and student representative, Ms. Emilee Reynolds to the National Advisory Committee on Institutional Quality and Integrity. The appointees will serve six-year terms. The committee makes recommendations regarding accrediting agencies.
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MacKenzie Scott’s Unrestricted Donations
Philanthropist and author, MacKenzie Scott continued to make transformative donations to HBCUs. Philander Smith University received $19,000,000; Prairie View A&M University received $63,000,000; Xavier University of Louisiana received $38,000,000; North Carolina A&T State University received $63,000,000; Howard University received $63,000,000; Howard University Medical College received $17,000,000; and Dillard University received $19,000,000. Last month Ms. Scott made large unrestricted gifts to several other HBCUs as well as tribal, and minority-serving institutions.
Anonymous Donor Continues Support
An anonymous donor gifted another $5,000,000 to Livingstone College—boosting their total contributions to the Miracle on Monroe Street project over the $61,000,000 mark. The project will use the funds to restore, refurbish, and rehabilitate campus infrastructure.
Counseling Programs
The Department of Education Office of Special Education and Rehabilitative Services awarded North Carolina A&T State University College of Education three grants. One will support the students in the counseling masters program training to serve K-12 students who have disabilities. Another, will provide $1,000,000 to the masters in clinical rehabilitation program. A separate $1,000,000 grant will provide funding to the Aggie Clinical Rehabilitation Scholars Mental Health project.
Continued Support for Endowed Scholarship
Frank and Patricia Kabela donated $1,200,000 to the Kabela Family Endowment at Savannah State University. Established in 2019, the endowment provides scholarships to qualified Savannah State University students who need financial assistance to continue their studies.
Environmental Issues
The Department of Energy awarded Prairie View A&M University a $750,000 grant to investigate flooding and air pollution in the Beaumont-Port Arthur region. Dr. Noel Estwick will lead the project. The researchers will collaborate with residents and local leaders to develop strategies to address the problems.
Robotics and Automation Training
The National Science Foundation awarded a five-year $500,000 grant to Howard University to provide robotics and automation training to local K-12 teachers. Dr. Fadel Lashhab will lead the project in collaboration with Dr. Katherine Pichho and Dr. Imtiaz Ahmed. The researchers will employ virtual and physical labs and collaborate with partners in industry to provide participants with mentorship, resources, and other opportunities.
Grant and Loan Access
The Reinvestment Fund announced the establishment of the HBCU Brilliance Initiative. The initiative will provide $40,000 in grants and up to $1,000,000 in loans to an initial cohort of 11 HBCUs. It will also promote collaboration, access to additional resources, and development strategies. The participants include, Bethune-Cookman University, Coahoma Community College, Fort Valley State University, Interdenominational Theological Center, Paine College, Shorter College, Stillman College, Tougaloo College, Virginia Union University, Voorhees University, and Wilberforce University.
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Publishing Platform
Virginia Union University announced a partnership with
Townsend Press that will provide a system-wide publishing platform. Faculty and students will have access to peer reviews, editorial services, production services, and distribution of the completed work. The partnership was developed in collaboration with the Sunday School Publishing Board, which in affiliation with the National Baptist Convention, has developed, produced, and distributed Christian resources for over 100 years.
Scholarship Application for Employees
Employees and their families at participating institutions can take advantage of a partnership between the Council of Independent Colleges and the Tuition Exchange. The partnership allows students to submit one application for tuition benefits that will be used by both entities. The initiative replaces a system where institutions participating in Tuition Exchange and the Council of Independent Colleges Tuition Exchange Program used separate application submission and tracking systems.
New Majors and Platform
Bethune-Cookman University announced it will add undergraduate majors in actuarial science, applied artificial intelligence, cybersecurity, digital marketing, e-sports and gaming administration, healthcare administration, and supply chain management. The university also added a healthcare administration tract to its masters of business administration degree program and launched an online learning platform. The updates launch in the Spring 2026 semester.
Tech Industry Partnerships
Miles College announced a collaboration with NVIDIA Corporation that will integrate AI across academic programs, faculty research, and the campus community at large. Miles College has also become a Career Choice partner for Amazon. As part of Amazon’s network of higher education partners, the college will offer classes and training to Amazon employees.
Grant Management Consultants
The National Organization of Research Development Professionals (NORDP) has selected Winston-Salem State University (WSSU) to participate as a partner institution in its consultants program. The program will provide WSSU’s Office of Research and Innovation with consultants to help refine its research and commercialization infrastructure. The multi-year partnership is funded through a $150,000 grant from NORDP.
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Federal Student Aid (FSA) and Compliance
Announcements
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Federal Student Aid (FSA) updated the E-App to improve the user experience and include new self-certification capability.
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The Department announced a January 2, 2026 launch date for the new foreign gifts and contracts reporting portal. The portal will accept bulk uploads and be cable of saving drafts with the option to review and revise data. A recorded training webinar will be available soon.
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An update to the FAFSA adjusts the country, state/province codes available to applicants.
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An update to the FAFSA includes an alert which is triggered if an applicant selects an institution whose graduates’ median earnings are lower than those of typical high school graduates in the same state. The trigger uses College Scorecard data.
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The Department updated verification guidance for the 2026-2027 FAFSA to allow identity verification through video calls, an in-person signed notary statement, or via a third party that uses a method that complies with the National Institute of Standards and Technology Identity Assurance Level 2 standard.
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Event: The Council of Independent Colleges 2026 Presidents Institute
Date: January 4-7, 2026
Location: Orlando, FL
Information: Details
Event: 2026 CHEA/CIQG Annual Conference
Date: January 26–29, 2026
Location: Washington, DC
Information: Details
Event: Association for Biblical Higher Education Annual Meeting
Date: February 11-13, 2026
Location: Orlando, FL
Information: Details
Event: ACE Annual Meeting
Date: February 26-27, 2026
Location: Washington, DC
Information: Details
Event: The 2026 AABHE Annual Conference
Date: April 11-14, 2026
Location: Baltimore, Maryland
Information: Details
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About this Publication
WPG HBCU News is a monthly email published by the Wesley Peachtree Group, CPAs (WPG) as a service to the sector. It consists of short summaries of news articles, government regulations, and announcements found online.
WPG HBCU News is available at no cost to HBCU administrators, trustees, and senior stakeholders. It is not intended as legal or financial advice. WPG's staff, writers, editors, publishers, web hosts, email distributors, and others involved with the production and presentation of this newsletter are not liable for errors, omissions, losses, injuries, or damages arising directly or indirectly from use of this newsletter or any information presented therein.
WPG is a full-service accounting firm serving privately held businesses and clients in the education, government, faith-based, and not-for-profit sectors. We specialize in higher education with a particular emphasis on minority-serving institutions. We hope you find this publication useful and welcome your feedback. |
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The Wesley Peachtree Group, CPAs
Atlanta Office:
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+1 404-874-0555
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