The federal reconciliation bill passed last month has wide-reaching implications for higher education. While much of it does not take effect until July 2026, its impacts will begin to be felt in the near future and warrant watching closely now:

Changes to financial aid: the budget’s most direct impact on students is changes to financial aid. The bill eliminates GradPLUS loans, puts a cap on ParentPLUS loans, restructures loan repayment plans, adds new earnings accountability measures for colleges, and introduces Pell grants for short-term workforce programs (see a summary of all the changes to financial aid here). On the whole, these address some important issues (i.e. we find that families taking ParentPLUS loans struggle to repay them), but also open up new ones, like an understaffed education department monitoring the quality of workforce programs.

Budget cuts: the bill’s massive cuts to Medicaid and SNAP will have a profound effect. New York state, for example, is projected to lose around $15 billion dollars, 1.5 million people could lose health insurance, and 1 million may lose food assistance. These reductions will impact students (over 20% of students face food insecurity and 3.4 million students rely on Medicaid) and schools – historically, when states face budget shortfalls like these, funding for education gets slashed.

The path ahead: The bad news is that the upcoming 2026 federal appropriations bills (due Oct 1) threaten further cuts. The White House’s initial draft proposed eliminating all funding for critical postsecondary access and success programs such as: TRIO, GearUp, AmeriCorps, and Postsecondary Student Success Grants. All of these cuts fall hardest on first-generation students, low-income students, students of color, and the institutions that serve them.

The good news is that we’ve learned we can make a difference. The first version of the reconciliation bill included massive cuts to the Pell grant which were avoided thanks to the advocacy of the postsecondary access community. A bipartisan effort forced the administration to release nearly $7 billion it had been withholding from states for Fiscal Year 26. And, efforts are already underway to protect TRIO and AmeriCorps, and last week a senate committee made a preliminary vote to maintain their funding.

We know from our students that young people still want to go to college, and national data tell the same story: postsecondary enrollment is up, FAFSA applications have significantly increased, and confidence in higher education has improved. As budget decisions continue at the federal, state, and local levels, we must continue to fight to preserve postsecondary opportunity.