Substitute House Bill No. 5158 aims to prohibit higher education institutions in Connecticut from reducing the financial aid awarded to students who receive scholarships from public or private sources. The bill specifies that financial aid reductions are only permissible under certain conditions: if a student's total financial aid meets or exceeds their cost of attendance, if the reduction is necessary to comply with financial aid restrictions set by athletic associations for student athletes, or if the student receives a grant from the Roberta B. Willis Scholarship program. The bill defines "financial aid" as the total of scholarships, grants, and federal, state, and institutional aid, excluding loans.

The bill will take effect on July 1, 2026, and is expected to have a minimal fiscal impact on higher education institutions, as it may require them to increase the total amount of financial aid they offer. By prohibiting scholarship displacement, the bill prevents institutions from saving costs by reducing financial aid packages when students receive scholarships, which could affect their ability to reallocate financial aid to other students or reduce overall financial aid offerings.