DHS Proposes Substantial New Fees for F-1 Optional Practical Training; Rule Is Not in Effect and Faces Significant Legal Obstacles
On October 7, 2026, the Department of Homeland Security (DHS), through U.S. Immigration and Customs Enforcement (ICE), released a proposed rule that would require schools certified by the Student and Exchange Visitor Program (SEVP) to pay a fee before recommending F-1 students for Optional Practical Training (OPT). The proposal is scheduled for publication in the Federal Register on October 8, 2026. The proposed rule does not change current OPT requirements or fees, and cannot take effect unless DHS completes the rulemaking process and publishes a final rule. If finalized in its current form, the rule is expected to face prompt legal challenge from well-resourced stakeholders, and there are substantial grounds on which a court could block it. In our opinion, it is likely that the rule will be blocked by a court before it takes effect.
Background
The proposed fee would be $70,000 for a student's first OPT recommendation and $30,000 for each later recommendation, including STEM OPT extensions. It would apply to both pre-completion and post-completion OPT.
The fee would be assessed on the school, not directly on the student or the employer. DHS acknowledges that schools could pass the cost on to students or employers.
USCIS would not approve an OPT employment authorization application unless the school has paid the applicable fee.
A school could request a discretionary refund if the student does not receive an Employment Authorization Document (EAD).
If finalized, the rule would take effect 60 days after publication of the final rule. It would apply only to DSO recommendations dated on or after the effective date. Students already participating in OPT, or holding a DSO recommendation dated before the effective date, would not be affected for that period of OPT.
DHS has provided a 30-day public comment period, which closes in early November 2026.
Implications
The proposal faces significant legal obstacles. DHS does not rely on any specific statute that authorizes it to charge fees. Instead, it relies on its general authority to set the conditions of nonimmigrant status. DHS also acknowledges that the fees would not fund its programs, but would be deposited in the general Treasury, and that the amounts were set to deter participation rather than to recover costs. These features support the argument that the charge is effectively a tax, which only Congress may impose. Following the Supreme Court's 2024 decision in Loper Bright Enterprises v. Raimondo, courts no longer defer to an agency's interpretation of its statutory authority. DHS's own estimate of more than $12 billion in annual transfers also invites scrutiny under the major questions doctrine.
The rule may also be challenged under the Administrative Procedure Act on several grounds: the evidentiary basis for the fee amounts, DHS's treatment of reliance interests and regulatory alternatives, and the abbreviated comment period.
The parties most directly affected are major research universities, state university systems, large employers, and state and local governments. Many of these parties have both the resources and the incentive to litigate. Recent DHS fee measures have been challenged successfully in court. In State of California v. Mullin, a federal court vacated an H-1B petition fee, and the U.S. Court of Appeals for the First Circuit declined to stay that ruling.
What This Means for Our Clients
No action is required at this time. The proposal is not in effect, and current OPT and STEM OPT rules and fees remain unchanged.
Proceed as usual. Employers may continue to recruit, hire, and onboard F-1 students on OPT and STEM OPT, and students may continue to seek DSO recommendations and file for employment authorization under the current rules.
Existing and pending authorizations are not affected. The proposal would not apply to current OPT or STEM OPT employment, or to any DSO recommendation dated before the effective date of a final rule.
Significant legal obstacles remain. As described above, the proposal faces substantial challenges to DHS's statutory authority and under the Administrative Procedure Act. The affected stakeholders have considerable resources to pursue those challenges, and we believe will be successful in blocking the rule.
Monitor developments. We will continue to track the rulemaking and any related litigation, and will advise clients promptly if anything changes.