A set of rules has been handed down, and institutions are now tasked with interpreting how those rules translate into everyday operations.
The One Big Beautiful Bill Act (OBBBA, or OB3) takes effect July 1, 2026. While the date may seem distant, the planning cannot wait. There are several areas that require institutional definition before any system—even Portico’s CORE Financial Aid software—can meaningfully assist. Policies around Leave of Absence (LOA), enrollment continuity, cohort distinctions, and even the definition of full-time status must first be clarified at the institutional level.
Policy changes break operations before they break systems
Policy changes tend to disrupt operations long before they disrupt systems. Although the federal implementation date is July 1, 2026, institutions must begin preparing now by thinking through how these changes will affect daily processes.
Questions naturally arise:
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What operational workarounds may be required?
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What manual controls may need to be introduced during the transition?
These questions may initially feel ambiguous, but they become clearer as we look more closely at the operational conversations institutions will need to have. Consider areas such as LOA policies and enrollment continuity. Students move in and out of programs, pause their studies, and return at different points. Institutional policies governing those transitions can influence how eligibility is determined under the new regulations.
This is where the complexity begins to surface. The impact of OB3 is not purely technical—it is operational. Institutions need to review their current processes and understand how they function in practice before relying on any system to support them. Looking at how enrollment changes are handled today, how programs are structured, and how policies are applied day to day will help determine how these new requirements fit into existing operations.
Institutions will also need to consider the implications for different student cohorts, particularly programs that extend beyond three years. New incoming students who have already begun conversations with admissions teams may be starting their programs under a very different financial framework beginning July 1.
Let's paint a picture...
A student attends an institution with an annual Cost of Attendance of $50,000. Over four years, the total program cost is $200,000. Prior to OB3, the student might receive $25,000 in federal aid and grants each year, with parents borrowing the remaining $25,000 through PLUS loans. These loans could cover the remaining Cost of Attendance after aid, with no annual or aggregate cap. Multiple parents could borrow, and effectively there was no ceiling on the amount of gap financing available.
Under OB3, that structure changes significantly. Borrowing is now limited to $20,000 annually, shared among all individuals borrowing on the student’s behalf. Previously, multiple family members could each borrow toward the remaining balance. Now the combined borrowing across all individuals is capped. In addition, aggregate limits may constrain the total borrowing available over time, meaning large funding gaps can no longer be addressed through unlimited borrowing.
This shift introduces new considerations for institutions. Financial aid teams will need closer collaboration with academic advising and student support functions to identify students who may be approaching these limits and determine how institutions can help students bridge emerging financial gaps.
Questions your institution has to answer first
Before technology can support these changes, institutions must first answer several foundational questions:
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What constitutes continuous enrollment at your institution?
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How do your LOA policies interact with grandfathering status?
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What definition of full-time will you use for loan proration purposes?
Enrollment is dynamic. Students add courses, drop courses, and change sections throughout a term. Attempting to manually track every change and its impact on eligibility is simply not sustainable.
This is why the work of defining institutional policies and operational thresholds must begin now, well ahead of the July 1 deadline.
Once those definitions are in place, automation can do what it does best—continuously evaluate enrollment activity and apply the rules your institution has deliberately established.
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Nan Murray is Financial Aid Product Manager at Portico, where she leads the design, improvement, and architecture of the financial aid software your team uses every day. She has eight years of experience in financial aid across higher education institutions.
This article is drawn from Portico's first OBBBA webinar. Watch the full session on YouTube and visit the OBBBA Resource Hub for guides, updates, and upcoming events as final guidance develops.
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Portico offers financial aid software and full managed services for career-focused schools. Portico replaces manual work and disconnected systems with automation, real-time updates, and built-in compliance checks. From document collection to disbursement and reconciliation, every step is connected and easier to manage.