Debt-Free College Act of 2026

Debt-Free Higher Education Opportunities: Section 499A-3 and Section 499A-5 establish grants for states to cover the unmet financial need of eligible students, giving individuals the chance to attend in-state public colleges without debt.

Support for DREAMer Students: Section 4 of the bill amends federal law to allow DREAMer students who meet specific educational, age of entry, or military service requirements to be eligible for Federal Pell Grants and Title IV financial aid.

Targeted Aid for HBCUs and MSIs: Section 3 creates a grant program under Section 372 for Historically Black Colleges and Universities, Tribal Colleges and Universities, and other Minority-Serving Institutions to provide need-based financial aid and cover unmet student needs.

Tuition and Fee Caps: Section 499A-4 and Section 3 require participating states and eligible institutions to cap tuition and fees at current levels, permitting only yearly increases based on the Consumer Price Index.

Student Success Services: Section 499A-5 mandates that a portion of grant funds be used for student success programs, such as hiring additional counselors, providing tutoring, and offering microgrants to help low-income students graduate.

Strict Compliance and Loss of Eligibility: Section 499A-7 and Section 3 outline penalties where states or institutions that breach program terms can be placed on probation, fined, or have their funding revoked, which could disrupt financial aid for students if a school loses eligibility.

Restrictions on Aid Distribution Priorities: Section 499A-5 requires states to disburse remaining funds to non-Pell Grant recipients based on state-determined priorities, potentially leaving some students with unmet financial needs if funds run out.