This legislation, known as the Student Protection and Success Act, aims to increase institutional accountability for student loan outcomes by amending the Higher Education Act of 1965. Beginning in fiscal year 2028, institutions of higher education will become ineligible to participate in federal direct student loan programs if their cohort repayment rate falls to 15 percent or less. This ineligibility extends for three fiscal years and also applies to other federal aid programs like Pell Grants and Federal Perkins Loans. The bill defines the cohort repayment rate as the percentage of borrowers who are not in default and make at least a one-dollar reduction on their initial student loan principal balance within two fiscal years of entering repayment. Certain borrowers are excluded from this calculation, including those in specific deferments for graduate study, active enrollment, military service, or public service like the Peace Corps. Institutions will have an opportunity to appeal a loss of eligibility if they can demonstrate an inaccuracy in the Secretary's calculation. A key provision introduces risk-sharing payments , requiring institutions participating in the direct student loan program to remit payments to the Secretary starting in fiscal year 2028. These payments are based on an institution's cohort nonrepayment loan balance , which represents the total loan balance of borrowers who have not made a one-dollar principal reduction over three consecutive fiscal years since entering repayment, deferment, or forbearance. Similar to the repayment rate, certain borrowers in specific deferment or forbearance categories are excluded from this nonrepayment calculation. The risk-sharing payment is calculated as 2 percent of a modified nonrepayment loan balance, with a cap of 2.5 percent of the institution's total annual revenues. The funds generated from these risk-sharing payments will exclusively finance a new College Opportunity Bonus Program . This program will award grants to eligible institutions that demonstrate a cohort repayment rate greater than 25 percent, recognizing their strong record in making college affordable and increasing access and success for low- and moderate-income students. Grant funds from the bonus program can be used to support reforms such as awarding additional need-based financial aid to Pell Grant-eligible students, enhancing academic and student support services, and establishing or expanding accelerated learning opportunities. The grant amount is determined by a formula considering the number and percentage of Pell Grant students, their cohort repayment rate, and the institution's student service expenditures. Additionally, the Secretary of Education is mandated to report on best practices for improving repayment rates, particularly for institutions serving a high proportion of low-income students.