One Big Beautiful Bill Act (OBBBA)
Background
The One Big Beautiful Bill Act (OBBBA) was signed into law on July 4, 2025. This law makes major changes to federal student financial aid, including updates to:
- Pell Grant eligibility
- Short-term program eligibility
- Federal student loan limits
- Student loan repayment plans
Most changes apply to enrollment periods beginning on or after July 1, 2026.
Important Disclaimer
This webpage is intended to help students understand upcoming changes to federal student aid programs as they pertain to Pima Community College. The information reflects our current understanding of the law. However, it is not official federal guidance and should not be considered final or definitive. Additional updates may be issued by the U.S. Department of Education.
What You Need to Know
At a Glance
- No changes apply to the 2025–26 aid year, which includes the Summer 2025 semester.
- Major changes take effect July 1, 2026 (Pell, loans, student loan repayment), beginning with the Fall 2026 semester.
- More guidance from the U.S. Department of Education is expected.
Pell Grant Program Changes
- SAI Limit: If your Student Aid Index (SAI) is more than twice the maximum Pell Grant award (14,790 based on $7,395 x 2), you will not qualify for a Pell Grant — even if you meet minimum Pell criteria.
- Cost of Attendance Rule: If non-federal grants or scholarships (such as state, institutional, or private aid) are equal to or exceed your Cost of Attendance (COA), you will not be eligible for a Pell Grant.
- Foreign Income Reporting: Foreign income must be included in your Adjusted Gross Income (AGI) on the 2026–27 FAFSA. This may affect Pell eligibility.
- New Workforce Pell Program: Pell Grants may become available, in the future, for certain short-term programs.
Federal Student Loan Changes
- Direct Subsidized/Unsubsidized - Aggregate (lifetime) borrowing limits remain the same.
- Parent PLUS Annual Loan Limit change - $20,000 per year, per dependent student; $65,000 lifetime per dependent student (combined across all parents).
- Part-time Enrollment Rule: Students enrolled less than full-time must have their annual loan limit reduced proportionally. Example: A freshman dependent student with a $5,500 annual limit enrolled half-time could borrow up to 50% of that amount for the academic year.
- Student Loan Repayment Options: Repayment options will be streamlined to two plans: a new tiered standard repayment plan and a new income-driven repayment plan called the Repayment Assistance Plan (RAP).
Begin Planning Now
- Plan ahead: Review your borrowing needs and scholarship opportunities.
- Budget carefully: Consider updated Pell and loan limits when planning for future semesters.
- Stay informed: Watch for official updates from the U.S. Department of Education.
Resources
Official updates: https://studentaid.gov/announcements-events/big-updates