The One Big Beautiful Bill Act is distinguished by its implementation of substantial modifications to the United States tax code, including the adjustment of individual income tax brackets established in 2017.
Furthermore, the legislation encompasses provisions not directly related to taxation, which are poised to impact the lives of ordinary Americans, particularly concerning travel, women's healthcare, immigration, and welfare benefits.
**Air Traffic Control**
The new statute allocates $12.5 billion to the Department of Transportation to initiate much-needed reforms to the nation's air traffic control system.
This allocation includes $4.75 billion designated for the upgrade of copper telecommunications infrastructure to fiber optics, $3 billion for the replacement of radar systems, $500 million for safety technologies to prevent near-misses on runways, and $100 million for advanced training technology for air traffic controllers.
At a cabinet meeting held on July 8, Transportation Secretary Sean Duffy characterized this funding as a "massive new start to rebuild air traffic control," while underscoring the necessity for additional financial resources to elevate American aviation to a leading global position.
Secretary Duffy has consistently highlighted the antiquated technology and infrastructure of the Federal Aviation Administration, which continues to rely on obsolete tools such as floppy disks, aging copper wiring, and rotary telephones.
Despite the identified need for further funding, the provisions of this legislation could contribute to the mitigation of delays reminiscent of those that significantly affected operations at Newark International Airport in New Jersey earlier this year.
**Border and Immigration**
The legislation allocates a total of $150 billion for border security and immigration enforcement, aligning with several of President Trump's key commitments on the 2024 campaign trail.
Approximately $80 billion of this sum is designated for domestic immigration enforcement operations. The most significant immigration-related provision within the law is the allocation of $46.5 billion for the construction of a border wall along the U.S.–Mexico border.
Much of the remaining funds are earmarked for Immigration and Customs Enforcement (ICE), the agency primarily responsible for executing the Trump administration's mass deportation initiatives.
This includes $45 billion allocated for detention operations through September 2029, representing a 365 percent increase over ICE's previous annual detention funding, which was $3.4 billion, as reported by the American Immigration Council. Additionally, $14.4 billion has been designated for transportation and removal operations, reflecting a 500 percent annual increase.
Furthermore, $13.5 billion is allocated in grants to state and local governments that assist with deportation efforts.
**Education**
The bill introduces several noteworthy modifications to federal education policy. Firstly, it reduces Pell Grant eligibility for high-income students and those receiving full-ride scholarships.
The approximately $7,000 annual grant has historically provided significant financial support for Americans pursuing higher education.
The legislation also proposes two federal student loan repayment plans: one traditional repayment plan and one income-based repayment plan, as Republican lawmakers seek to eliminate President Joe Biden’s controversial Saving on a Valuable Education (SAVE) plan.
Moreover, it mandates a taxation of college and university endowments at a variable rate—either 1.4 percent, 4 percent, or 8 percent—based on the institutions' financial wealth.
**Medicaid and Rural Hospitals**
Notable amendments have been made to Medicaid funding, which are expected to result in millions of beneficiaries losing access to this entitlement program while potentially threatening the sustainability of rural hospitals.
To curtail Medicaid expenditure, the legislation imposes an 80-hour monthly work requirement for able-bodied adults to qualify for benefits; this modification is scheduled to take effect no later than December 2026.
It also decreases the "provider tax"—the rate at which states tax hospitals and doctors to fund their Medicaid programs—from 6 percent to 3.5 percent in states that opted to expand Medicaid under the Affordable Care Act.
Conversely, ten states that did not implement expansions will not experience changes. This adjustment will not take effect until 2028. To alleviate concerns regarding potential adverse impacts on rural hospitals, the bill designates $50 billion over the next five years to support such facilities.
Estimates regarding the number of individuals projected to lose coverage as a result of these Medicaid alterations vary significantly, with the Congressional Budget Office predicting that several million individuals nationwide may be affected.
**SNAP Cuts**
The One Big Beautiful Bill Act also establishes new requirements for recipients of the Supplemental Nutrition Assistance Program (SNAP), widely recognized as food stamps.
The legislation introduces more rigorous work requirements for SNAP recipients. Currently, able-bodied beneficiaries aged 18 to 54 are mandated to engage in 80 hours per month of volunteering, employment, job-seeking, or educational activities.
The new provisions extend this requirement to encompass individuals aged 18 to 64. In addition, states will bear an increased financial responsibility regarding SNAP funding, which may result in decreased benefits or complete loss of access for recipients, contingent upon their state of residence.
**'Trump Accounts' for Newborns**
The bill also introduces a pilot program for "Trump Accounts," a type of federal trust account seeded with $1,000 from the Treasury Department for every child born between January 1, 2025, and December 31, 2028. Children born prior to this period may still be eligible, albeit without access to the initial $1,000 funding.
This initiative permits Americans to contribute up to $5,000 annually to these accounts. Funds must be invested in a broad stock market index, and any income generated will grow tax-deferred until withdrawal.
Beneficiaries may access half of the account balance for qualified expenses upon reaching the age of 18 and the full balance at age 25. Withdrawals will then be subject to either capital gains taxes or income tax rates, depending on the nature of the expenditure.
Specific expenses, such as tuition, first home purchases, or small business expenditures, will be subject to the lower capital gains tax rate, while all other uses will incur standard income tax rates, including an additional 10 percent penalty for non-qualified expenditures.
**Spectrum**
One provision of the legislation reinstates the Federal Communications Commission's authority concerning spectrum, which allows the agency to auction specific radio frequencies to the private sector.
This authority lapsed in 2023 and became stalled in Congress due to limited direction from the Biden administration.
The reauthorization of this program within the current legislation is projected to generate $85 billion in federal revenue over the next decade, facilitate the expansion of 5G and 6G mobile networks, and ensure that rural areas receive essential radio communications, particularly during natural disasters when access to television may be compromised.
**Defunding Planned Parenthood**
The One Big Beautiful Bill Act terminates Medicaid funding for Planned Parenthood for a duration of one year. Eliminating federal funding for Planned Parenthood, which provides reproductive health services including abortion, has long been a primary objective for conservative lawmakers.
While the legislation does not explicitly mention Planned Parenthood, it refers to abortion providers that are non-profit organizations and received over $800,000 in Medicaid reimbursements during the fiscal year 2023. A federal judge has since placed this provision on hold, pending further legal proceedings.
**Obamacare Changes**
The law also implements several significant alterations to the Affordable Care Act (ACA), commonly referred to as "Obamacare." The ACA Marketplace enables low-income Americans to purchase subsidized health insurance.
Firstly, the legislation mandates that marketplace enrollees must re-enroll annually, mirroring the requirement for some employees to reconfirm their chosen coverage for employer-sponsored health insurance plans. Consequently, during the re-enrollment process, consumers will also be required to verify their income once again.
Furthermore, the legislation shortens the open enrollment period—previously extended under President Biden—returning it to the original timeframe of November 1 to December 15.
Additional provisions within the law exclude gender transition treatments from coverage, restrict Marketplace tax credits to citizens and certain lawful residents, and require that enrollees be current on their premium payments prior to re-enrolling for the subsequent year.
These changes will be implemented incrementally, with specific eligibility-related provisions slated to take effect as soon as December 2025.
**Expansion of Military Housing and Support Programs**
The One Big Beautiful Bill Act includes a $9 billion expansion of programs related to housing, childcare, and other benefits for members of the Armed Forces and their families. This expansion comprises a $2.9 billion increase in the
Basic Allowance for Housing and $590 million to assist with temporary housing allowances for service members undergoing relocation. Furthermore, it allocates additional funding for the military healthcare system.
The enhancement of benefits may serve as an incentive for more individuals, particularly those with spouses and children, to enlist in the armed services.
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