H.R. 713 (119th)Bill Overview

Preventing Financial Exploitation in Higher Education Act

Education|Civil actions and liabilityEducation
Cosponsors
Support
Republican
Introduced
Jan 23, 2025
Discussions
Bill Text
Current stageCommittee

Referred to the Committee on Education and Workforce, and in addition to the Committee on Ways and Means, for a period to be subsequently determined by the Speaker, in each case f…

Introduced
Committee
Floor
President
Law
Congressional Activities
01 · The brief
Plain-English summaryWhat this bill actually does

The bill creates institutional penalties and tax increases targeted at wealthy colleges and universities (endowments ≥ $2.5 billion). It requires covered institutions to pay graduated penalties tied to cohort default, delinquency, and underpayment rates on federal student loans.

Why people may split

Liberals emphasize accountability and revenue from wealthy endowments

Watch point

Relative to its intended legislative type, this bill establishes substantive new financial obligations and tax adjustments with clearly enumerated penalty rates and thresholds, and it integrates into existing statutory frameworks, but it leaves several operational, fiscal, and definitional details to agency discretion or silent, limiting completeness for implementation.

The bill creates institutional penalties and tax increases targeted at wealthy colleges and universities (endowments ≥ $2.5 billion).

It requires covered institutions to pay graduated penalties tied to cohort default, delinquency, and underpayment rates on federal student loans.

It conditions program participation on compliance and raises the net investment income tax rate for large institutions that increase tuition above an inflation-adjusted base.

Passage25/100

Substantial penalties and a large tax increase aimed at wealthy colleges make the bill politically and procedurally difficult despite consumer-protection appeal.

CredibilityPartially aligned

Relative to its intended legislative type, this bill establishes substantive new financial obligations and tax adjustments with clearly enumerated penalty rates and thresholds, and it integrates into existing statutory frameworks, but it leaves several operational, fiscal, and definitional details to agency discretion or silent, limiting completeness for implementation.

Contention70/100

Liberals emphasize accountability and revenue from wealthy endowments

02 · What it does

Who stands to gain, and who may push back.

Likely benefits vs burdens50% / 50%
Students · BorrowersCities · Students

These are examples from the analysis, not a ranked list of the most-affected groups.

Likely helped
  • StudentsCreates stronger financial incentives for wealthy institutions to reduce student loan defaults and delinquencies.
  • Potential benefitDiscourages large institutions from raising tuition above inflation due to a higher net investment income tax.
  • BorrowersEncourages expanded borrower supports like counseling, repayment aid, and career services to improve outcomes.
Likely burdened
  • CitiesLarge penalties and a much higher investment tax could materially reduce endowment returns and financial aid capacity.
  • StudentsInstitutions may restrict admissions or programs for higher-risk students to avoid penalties.
  • Potential burdenCompliance, monitoring, and administrative costs will rise to calculate and report cohort delinquency and underpayment.
03 · Why people split

Why the argument around this bill splits.

Liberals emphasize accountability and revenue from wealthy endowments
Progressive85%

Likely broadly supportive because the bill targets wealthy institutions and links accountability to student loan harms.

It aligns with progressive priorities to curb tuition growth and make high-endowment schools contribute more.

Some progressives would caution against penalties that indirectly harm students, noting uncertain effects on institutional aid or program access.

Leans supportive
Centrist55%

Cautiously supportive of accountability for institutions with large endowments and rising tuition, but wary of very large, blunt penalties.

Sees value in discouraging tuition hikes and aligning incentives, while emphasizing need for fair metrics, clear implementation, and cost analysis.

Would seek guardrails to avoid unintended harm to students or small programs.

Split reaction
Conservative20%

Likely skeptical or opposed due to expanded federal intervention, heavy taxation, and punitive financial penalties on private institutions.

While favoring accountability for poor outcomes and opposition to tuition hikes, this persona worries about overreach, distortion of institutional autonomy, and unfairly imposing liability for borrowers’ repayment choices.

Likely resistant
04 · Can it pass?

The path through Congress.

Introduced

Reached or meaningfully advanced

Committee

Reached or meaningfully advanced

Floor

Still ahead

President

Still ahead

Law

Still ahead

Passage likelihood25/100

Substantial penalties and a large tax increase aimed at wealthy colleges make the bill politically and procedurally difficult despite consumer-protection appeal.

Scope and complexity
52%
Scopemoderate
52%
Complexitymedium
Why this could stall
  • No official cost or revenue estimate provided in text
  • How Secretary will calculate cohort delinquency/underpayment rates
05 · Recent votes

Recent votes on the bill.

No vote history yet

The bill has not accumulated any surfaced votes yet.

06 · Go deeper

Go deeper than the headline read.

Included on this page

Liberals emphasize accountability and revenue from wealthy endowments

Substantial penalties and a large tax increase aimed at wealthy colleges make the bill politically and procedurally difficult despite consu…

Unlocked analysis

Relative to its intended legislative type, this bill establishes substantive new financial obligations and tax adjustments with clearly enumerated penalty rates and thresholds, and it integrates into existing statutory…

Go beyond the headline summary with full stakeholder mapping, legislative design analysis, passage barriers, and lens-by-lens tradeoff breakdowns.

Perspective breakdownsPassage barriersLegislative design reviewStakeholder impact map
Open full analysis