The One Big Beautiful Bill Act, set to take effect in 2026, is a sweeping overhaul of federal student aid programs. Despite its name, there is nothing beautiful about it. For New York, the consequences will be devastating: less access to education, fewer trained professionals in critical fields, and deeper economic inequality for generations to come.
This legislation eliminates Graduate PLUS loans and imposes strict federal borrowing caps for graduate and professional students. It also places new limits on Parent PLUS loans while restricting repayment and forgiveness options. All of this is being done under the guise of reform but make no mistake, the intent is not to lower the cost of college. It’s to limit who gets to attend and who gets to advance.
States like New York will soon be forced to choose between competing priorities: healthcare, housing, food assistance — or education. Education will likely be left behind, considered less urgent. But the consequences of that decision will be both immediate and long-lasting.
In the short term, we will see fewer students, particularly from low-income and historically excluded communities, enter college and graduate school. Enrollment declines will hit public and private institutions hard, threatening their financial survival. We’ve already seen this play out with the closure of schools like College of Saint Rose in Albany. Without intervention, more closures will follow.
Longer term, we’ll face a professional workforce crisis. Fewer doctors, nurses, social workers, teachers, and lawyers will graduate at a time when our communities need them most. The federal legislation severely undercuts New York’s efforts to build a strong, inclusive workforce for the future.
Graduate School: Priced Out by Design
Beginning July 1, 2026, new borrowers pursuing non-professional graduate degrees will be limited to $20,500 per year in federal loans and $100,000 total. Those in professional programs like law or medicine can borrow $50,000 per year, capped at $200,000.
While those numbers may sound substantial, they fall far short of the actual cost. The average cost of law school is now over $220,000. Medical school can exceed $250,000 and that’s not including living expenses. Under the new law, students from wealthy families will still go to graduate school. Everyone else will be left behind.
This is a deliberate reversal of decades of progress. Over the last 20 years, students of color and working-class families of all races have increasingly earned advanced degrees and entered fields once closed to them. This bill threatens to undo all of that. It’s no coincidence that Project 2025 — the right-wing policy blueprint informing this legislation — calls for eliminating access to federal loans and steering borrowers into the private market.
That’s not reform but exclusion, designed to keep even those who manage to earn a degree trapped in perpetual debt through costly private loans.
The changes to Parent PLUS loans are just as damaging. Parents will soon be limited to borrowing $20,000 per year and a total of $65,000 per dependent child. That may sound like a lot, until you consider that the average annual cost of college now exceeds $27,000 for in-state students at a public university, and well over $56,000 at private institutions.
Parents who borrow after July 1, 2026, will also lose access to income-driven repayment plans and will be blocked from obtaining loan forgiveness. They’ll be locked into a standard repayment schedule with no flexibility, even if they face job loss, illness, or caregiving responsibilities. And if they default, they risk wage garnishment, credit damage, and in extreme cases, losing retirement savings or Social Security benefits.
This is especially cruel considering the Parent PLUS loan portfolio, which is now over $100 billion, disproportionately consists of low-income borrowers and families of color. These parents were encouraged to borrow so their children could access opportunity. Now they’ll be punished for doing so.
What New York Must Do
The federal government is turning its back on students and families. New York must step up. Fortunately, New Yorkers with student loan debt can obtain free counseling services, get help managing their student loans, and access relief programs through EDCAP, a program funded by the state and operated by the Community Service Society of New York. But the scope and sweep of the federal threat borrowers face requires expanding resources and a robust public awareness effort.
What is needed is a coordinated, statewide response. That includes expanding state-based aid for graduate and professional students, investing in SUNY and CUNY pathways to high-demand careers, and expanding financial counseling infrastructure and services to help families understand their options.
It also means fighting these federal changes — in the courts, in Congress, and in coalition with other states.
This isn’t just about education. It’s about whether we will continue to build an equitable and inclusive economy or revert to a time when only the wealthy could afford to dream.
New York has always led the way in fighting for access, equity, and opportunity. It’s time to lead again, before it’s too late.
David R. Jones, Esq., is President and CEO of the Community Service Society of New York (CSS), the leading voice on behalf of low-income New Yorkers for more than 175 years. The views expressed in this column are solely those of the writer. The Urban Agenda is available on CSS’s website: www.cssny.org.