Ed Trust policy director Roxanne Garza outlines federal student‑aid overhaul, warns of Pell shortfall and details workforce Pell rollout

Roxanne Garza, director of higher education policy at the Education Trust, told the Financial Advisory Committee that the reconciliation bill passed last summer significantly reshapes federal student aid, and she urged institutions and state agencies to prepare for reforms that take effect July 1.

Garza said the law "cuts about 300 billion from federal financial aid over the next 10 years," and she warned that the changes include the elimination of Grad PLUS loans for new borrowers: "Grad PLUS loans no longer exist. They will no longer be available to new students that will be borrowing after July 1." She outlined new caps: graduate unsubsidized loans capped at $20,500 per year (lifetime $100,000) for graduate students and up to $50,000 per year (lifetime $200,000) for professional programs, and a Parent PLUS cap of $20,000 per year with a $65,000 lifetime cap per dependent student.

Why it matters: the limits reduce federal borrowing options for graduate and parent borrowers, which Garza said may push some students to private loans or deter attendance in high‑cost programs. She advised institutions to assess which programs might be affected and to develop communications and state/institutional aid alternatives.

Garz…