Senators Propose Letting Students Use Financial Aid To Pay For CLEP And Prior Learning Exams

A new bipartisan Senate bill would let students put federal financial aid toward the cost of prior learning assessments. These include the exams and portfolio reviews that award college credit for knowledge gained on the job, in the military, or through other training outside the classroom.

Sens. Amy Klobuchar and Tim Sheehy introduced the Credit for Prior Learning Act (S. 4897) on June 24. The bill would add an allowance of up to $2,000 per award year to a student’s cost of attendance for “reasonable costs, including test fees,” tied to credit for prior learning assessments.

Why It Matters

Credit for prior learning (CPL) can shave months or years off a degree and thousands off tuition, but the assessments themselves cost money and federal aid generally can’t be used to pay for them today. 

Because the bill works through the cost of attendance formula, students could use Pell Grants and federal student loans they already qualify for toward assessment fees, rather than paying out of pocket.

What Would Be Covered

The bill doesn’t name specific exams. Instead, it defines an eligible assessment as any evaluation of knowledge learned outside a college that tests for evidence of learning (not just time spent), meets standards set by subject matter experts, and results in real academic credit without additional coursework. The major options students use today:

• CLEP: The College Board’s 30-plus exam lineup is the most widely accepted credit-by-exam program. Exams cost $97 each, plus a test center or remote proctoring fee that varies by site. (Students who complete free online courses through Modern States can get vouchers that cover the exam fee.)
• DSST: Originally built for the military but open to everyone, DSST offers 30-plus exams at $100 each (plus test site fees), accepted at more than 1,500 colleges.
• TECEP: Thomas Edison State University’s exams run $53 per credit for lower-level subjects and $80 per credit for upper-level.
• Portfolio assessments: Faculty review documentation of work and training experience. Costs vary widely by school. URI charges $30 per credit (about $90 for a three-credit course), while Penn State charges a flat $390 whether or not credit is awarded.
• Challenge exams and training evaluations: Many colleges offer their own faculty-built exams (fees vary by school), and the bill’s definition also covers institutional evaluations of employer and military training, often based on ACE credit recommendations.

A note about AP exams ($99 each in 2026). Yes, they are credit-by-exam, but they’re administered through high schools and paid well before college enrollment — so the financial aid mechanism here wouldn’t help most AP test-takers in practice.

This same issue arises for things like taking CLEP exams in middle or high school. There’s no way to get financial aid to pay for it. It only really would work right before college or while in the early years of college.

Research from CAEL and WICHE shows how much prior learning credit moves the needle: adults who earned 12 or more CPL credits saved 9 to 14 months of time in college and $1,500 to $10,200 in tuition. Adults with CPL credit are 17% more likely to graduate, and that rises to 25% at community colleges and 19% for Pell Grant recipients.

How This Connects

College is expensive, and reducing time in college is one of the simplest ways to reduce total costs.

With the average cost of college rising more than 2.5% last year, testing out of even a semester’s worth of courses is one of the few levers students control. We’ve covered how graduating early can cut total college costs and CPL is often the fastest path to doing it, especially for adult learners returning to finish a degree.

The bill was referred to the Senate Health, Education, Labor and Pensions Committee, where neither sponsor holds a seat. Most standalone higher education bills stall in committee, but cost-of-attendance tweaks like this one can also end up riding along on a larger appropriations package. If enacted, the changes would take effect July 1, 2027.

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