Student Loan Bond Expansion Act of 2026
Sponsored By: Senator Chuck Grassley
Introduced
Summary
Exempts qualified student loan bonds from the federal private-activity bond volume cap and from AMT private-activity-bond treatment. This bill would change how qualified student loan bonds count in pooled financings and in alternative minimum tax calculations to encourage capital-market financing for student loans.
Show full summary
- State and local issuers: Would be able to issue qualified student loan bonds that do not count against the federal private-activity bond volume cap, and pooled financings would exclude student borrowers from the "ultimate borrower" counting rules.
- Students and loan programs: Could increase liquidity for qualified student loan programs and potentially lower borrowing costs by expanding access to bond financing.
- Investors and tax treatment: Would exclude bonds issued after enactment from being treated as private activity bonds for alternative minimum tax calculations, a change that could affect investor demand for these bonds.
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Bill Overview
Analyzed Economic Effects
1 provisions identified: 1 benefits, 0 costs, 0 mixed.
Lower-cost bonds for student loans
This bill would exempt qualified student loan bonds from the federal private-activity bond volume cap. It would also say qualified student loan bonds issued after enactment would not count as private activity bonds for Alternative Minimum Tax calculations. For pooled financings, student borrowers would not be treated as "ultimate borrowers" for those bonds. The AMT exception would not apply to a refunding bond unless it applied to the refunded (or original) bond. These changes would apply only to obligations issued after the date of enactment. This would make it easier or cheaper for issuers and investors to finance qualified student loans and would indirectly help borrowers.
Sponsors & CoSponsors
Sponsor
Chuck Grassley
IA • R
Cosponsors
Peter Welch
VT • D
Sponsored 2/3/2026
Bill Cassidy
LA • R
Sponsored 2/3/2026
John Reed
RI • D
Sponsored 2/10/2026
Roll Call Votes
No roll call votes available for this bill.
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