The U.S. Department of Education proposed a new federal “earnings test” that would strip Title IV loan eligibility from undergraduate programs that fail to show higher graduate earnings than typical high school graduates. The same approach would apply to graduate programs, using earnings comparisons within the same field. The framework is positioned as a “hard reset” on the value of a degree for federal financial aid purposes, following a January negotiated rulemaking process that reached consensus among federal, state, college, and accreditation leaders. The Department said it could become effective as early as July, with a 30-day public comment period following the proposal. Under the draft process, programs would face warnings after an initial failure, lose direct loan eligibility after a second failure, and face broader Title IV loss if the test remains unsatisfied in a subsequent cycle—potentially shifting institutional program design and federal aid strategies quickly.