The Supplemental Report of the 2016-17 Budget Act directs our office to estimate the cost of a new state financial aid program intended to eliminate the need for students to take on college debt. We estimate such a program for resident undergraduate students attending public colleges in California would cost $3.3 billion annually, on top of all existing gift aid. Adding certain eligibility requirements to the program could reduce these costs notably. For several reasons, the new program likely would reduce but not eliminate student loan debt. Additionally, the new program could create behavioral changes not factored into our estimate.