Family Farm and Small Business Exemption Act
- Bill Number
- H.R. 1131
- Origin Chamber
- House
- Congress
- 119th Congress, Session 1
- Policy Area
- Education
- Status
- Introduced
- Latest Action
- 2025-02-07: Referred to the House Committee on Education and Workforce.
- Last Updated
- 2026-06-30T08:06:47Z
AI-Generated Summary
Purpose
The Family Farm and Small Business Exemption Act (H.R. 1131) aims to restore exemptions for family farms and small businesses from being counted as assets when determining financial need for federal student aid under the Higher Education Act of 1965. This helps families with these assets qualify for more aid without their farm or business value reducing eligibility.
Key Provisions
- Amendment to Asset Definition: Updates Section 480(f)(2) of the Higher Education Act to exclude from "assets" the net value of:
- A family farm where the family lives.
- A small business (or part of it) with 100 or fewer full-time employees, owned and controlled by the family.
- Applicability: The changes apply to financial need assessments (called "need analysis") for federal student aid starting in award years on or after the bill's enactment date.
Significant Changes to Existing Law
- Previously, certain exemptions for family farms and small businesses may have been limited or removed in updates to the Higher Education Act. This bill restores and clarifies these exemptions by explicitly adding them back into the law's definition of excluded assets.
- It expands the small business exemption to include businesses with up to 100 full-time equivalent employees, providing a clearer size threshold than before.
Potential Impacts
- On Citizens: Families owning farms or small businesses could see increased access to federal student loans, grants, and work-study programs, as these assets won't lower their calculated financial need. This may make higher education more affordable for rural and entrepreneurial families.
- On Government Agencies: The U.S. Department of Education will need to update its need analysis formulas and guidance for aid applications, potentially increasing federal spending on student aid due to more eligible recipients.
- On International Relations: No direct impact, as the bill focuses on domestic education policy.
Main Stakeholders Affected
- Families and Students: Owners of family farms and small businesses, particularly in rural or agricultural areas, and their children seeking higher education.
- Higher Education Institutions: Colleges and universities that rely on federal aid to enroll students from these families.
- Federal Government: Agencies like the Department of Education administering Title IV programs (federal student aid).
- Small Business and Farming Communities: Groups representing these sectors, who may benefit from reduced financial barriers to education.
Notable Legal, Constitutional, or Political Implications
- Legal: Strengthens protections under the Higher Education Act by clarifying asset exclusions, potentially reducing disputes over aid eligibility. It aligns with statutory interpretation principles by "restoring" prior intent without altering broader aid formulas.
- Constitutional: No major issues; supports equal access to education under the Constitution's general welfare clause, without infringing on rights.
- Political: Bipartisan support (evident from numerous co-sponsors across parties) highlights rural and small business interests. Could influence future education funding debates by expanding aid access, possibly increasing costs but gaining favor in agricultural states.
This summary was generated by AI and may contain inaccuracies. Refer to the official source document for the authoritative text.
Sponsor
Cosponsors (89)
Rep. Panetta, Jimmy [D-CA-19], Rep. Thompson, Glenn [R-PA-15], Rep. Craig, Angie [D-MN-2], Rep. Davis, Donald G. [D-NC-1], Rep. Meuser, Daniel [R-PA-9], Rep. Ellzey, Jake [R-TX-6], Rep. Hageman, Harriet M. [R-WY-At Large], Rep. Sorensen, Eric [D-IL-17], Rep. Finstad, Brad [R-MN-1], Rep. Fleischmann, Charles J. "Chuck" [R-TN-3], Rep. Graves, Sam [R-MO-6], Rep. Cline, Ben [R-VA-6], Rep. Hinson, Ashley [R-IA-2], Rep. Bost, Mike [R-IL-12], Rep. Costa, Jim [D-CA-21], Rep. Tenney, Claudia [R-NY-24], Rep. Scott, Austin [R-GA-8], Rep. DesJarlais, Scott [R-TN-4], Rep. Edwards, Chuck [R-NC-11], Rep. Grothman, Glenn [R-WI-6], Rep. Maloy, Celeste [R-UT-2], Rep. Tokuda, Jill N. [D-HI-2], Rep. Bergman, Jack [R-MI-1], Rep. Van Orden, Derrick [R-WI-3], Rep. Franklin, Scott [R-FL-18], Rep. Zinke, Ryan K. [R-MT-1], Rep. Smith, Adrian [R-NE-3], Rep. Schmidt, Derek [R-KS-2], Rep. Moolenaar, John R. [R-MI-2], Rep. Smith, Jason [R-MO-8], Rep. Perez, Marie Gluesenkamp [D-WA-3], Rep. Rouzer, David [R-NC-7], Rep. Miller, Mary E. [R-IL-15], Rep. LaHood, Darin [R-IL-16], Rep. Messmer, Mark [R-IN-8], Rep. Fallon, Pat [R-TX-4], Rep. Bacon, Don [R-NE-2], Rep. Webster, Daniel [R-FL-11], Rep. Nunn, Zachary [R-IA-3], Rep. Fitzgerald, Scott [R-WI-5], Rep. Newhouse, Dan [R-WA-4], Rep. Valadao, David G. [R-CA-22], Rep. Guest, Michael [R-MS-3], Rep. Self, Keith [R-TX-3], Rep. Hudson, Richard [R-NC-9], Rep. Fong, Vince [R-CA-20], Rep. Downing, Troy [R-MT-2], Rep. Miller-Meeks, Mariannette [R-IA-1], Rep. Moore, Barry [R-AL-1], Rep. Evans, Gabe [R-CO-8] and 39 more
Recent Actions
- 2025-02-07: Referred to the House Committee on Education and Workforce.
- 2025-02-07: Introduced in House
- 2025-02-07: Introduced in House
Bill Versions
- Family Farm and Small Business Exemption Act — issued 2025-02-07 — PDF (3 pages)