Senate Heads Home After Confirming Secretary of Labor
Last week, the Senate adjourned for the last time before the upcoming November midterm elections. Both chambers of Congress will return to Washington, D.C. after the midterms, with attention likely to focus on advancing fiscal year (FY) 2027 appropriations ahead of December 11– the current deadline for federal funding set by the recently approved continuing resolution (CR). FY27 progress may also include discussions of the proposed regulations from the Office of Management and Budget (OMB) regarding the Uniform Grant Guidance (UGG), which, as previously reported, could broadly impact all states and federal grantees. Advance CTE will continue to monitor and engage in the appropriations process ahead of the CR deadline for any developments that could impact the Career Technical Education (CTE) community.
In its final major action before recess, the Senate confirmed Keith Sonderling as the next U.S. Secretary of Labor by a 47-41 vote on September 30. Sonderling has served as Acting Secretary of Labor since April and will now lead the U.S. Department of Labor (DOL) as it continues implementing the administration’s workforce priorities. Read more about Secretary Sonderling’s appointment here.
Federal Court Vacates PRWORA Notices
On September 21, the U.S. District Court for the District of Rhode Island granted summary judgment to 20 states and the District of Columbia in their legal challenge to the Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA) notices issued in July 2025 by the U.S. Department of Education (ED) and several other federal agencies. As a reminder, ED’s notice sought to newly classify Perkins V postsecondary CTE programs, adult education programs authorized under the Workforce Innovation and Opportunity Act (WIOA), and certain dual and concurrent enrollment programs as “federal public benefits” under this legislation. Advance CTE and partners requested clarification from ED last summer about the many potential implications of this notice, but to date the Department has not provided answers.
The court’s ruling addressed deficiencies in the regulatory process ED used rather than the substance of its interpretation, finding that the Department should have gone through formal notice-and-comment rulemaking before issuing this notice. The ruling vacates the PRWORA notices and permanently bars the agencies from enforcing them against the plaintiff states by other means, building on the preliminary injunction issued last fall. However, the ruling does allow federal agencies to pursue these changes in the future through a formal rulemaking process. Advance CTE will continue to closely monitor this issue and potential impacts on state CTE systems and related programming.
Treasury Releases Guidance on Federal Scholarship Tax Credit
Last week, the U.S. Department of the Treasury (Treasury) and Internal Revenue Service (IRS) released temporary and proposed regulations to implement the new Federal Scholarship Tax Credit created by the One Big Beautiful Bill Act. Beginning in 2027, individuals can receive a dollar-for-dollar, nonrefundable federal income tax credit of up to $1,700 for qualifying contributions to participating Scholarship Granting Organizations (SGOs). Eligible learners must come from households with income at or below 300 percent of the area median gross income. Treasury noted that additional guidance on specific qualified educational expenses and other important definitions for the program will be forthcoming.
The temporary regulation establishes procedures for states and SGOs to prepare for implementation in 2027, while the proposed rule public comment window is open until December 1 to shape future implementation. Read the Treasury press release here.
ED Widens Implementation of “Defend the Spend”
Last week, ED issued a memorandum and accompanying resources outlining requirements for grant recipients under its “Defend the Spend” initiative. The guidance applies broadly to all ED grantees and provides specific instructions for submitting written justifications for payment requests. ED previously issued similar guidance specifically affecting Perkins V grantees.
Odds & Ends
- DOL awarded $43 million to seven states through the second round of the Industry-Driven Skills Training Fund, supporting employer-driven training in areas including advanced manufacturing, shipbuilding, aerospace, nuclear energy, information technology, and health care. Across two rounds, the initiative has now awarded more than $129 million to 21 states. Read the DOL press release here.
- ED approved four additional Workforce Pell programs in Florida, making it the sixth state to receive program approvals since implementation began in July. The programs will prepare learners for careers in firefighting, corrections, and emergency management. Read the ED press release here.
- ED issued an information collection related to eligible career pathway programs, which provide one pathway for individuals without a high school diploma to qualify for federal student aid through Higher Education Act Title IV Ability to Benefit. Comments are due November 2, 2026. View the information collection on the Federal Register here.
