U.S. Department of Education Once Again Delays FAFSA Processing Until March
The Department of Education (ED) announced
Jan. 30 that there will be a delay in sending applicant data to colleges for
financial aid processing due to a mistake in the recently updated Free Application
for Federal Student Aid (FAFSA). Originally planned for late January, financial
aid information from FAFSA forms will now be transmitted to colleges beginning
in March, resulting in colleges needing additional weeks to process and generate
aid offers. This delay means students may not know their aid eligibility until
April, leaving limited time for decision-making before the May 1 “College Decision
Day”. The new FAFSA was introduced last month as part of a congressional mandate
to simplify the application, with 3.1 million people having already submitted the form.
ED has asked colleges to consider extending the acceptance
deadline for students affected by the delays. The Department also plans to inform
students when their information has been shared with their schools and when they
can access official aid calculations on studentaid.gov.
The delays in transferring applicant data are exacerbated by
the need to fix an error in the FAFSA, involving an outdated
formula. ED was notified that the variables they were using in their federal aid
formula were incorrect because they were not in compliance with instructions laid
out in the FAFSA simplification bill passed by Congress. Specifically, the bill
called for an increase in the amount of income shielded from the formula that
determines how much students must pay and the aid they can receive. Congress directed
ED to raise the amount of income protected by 20% for parents, 35% for dependent
students and almost 60% for students with children of their own, as well as to
adjust the numbers for inflation annually.
ED’s
formula did not incorporate the adjustments, which were also supposed to be calculated
using the Consumer Price Index from April 2020 to April of this year—a period
of record-high inflation. ED initially refused to correct the formula, citing
the delays that it would cause, but the agency eventually reversed course and
agreed to fix the formula. The changes made in the calculations will allow 1 million
students to receive more Pell Grant money and 159,000 more students will now be eligible for the grant.
The FAFSA overhaul was originally intended to be finalized and implemented by 2022.
College Cost Reduction Act Passes Out of U.S. House Education Committee
Last week, the U.S. House of Representatives’ Education and Workforce Committee
passed the Republican-sponsored H.R. 6951, “College Cost Reduction Act”, by a party line
vote of 22 to 19. Democrats offered 30 amendments to the bill, none of which passed.
The “College Cost Reduction Act” addresses raising college
costs, including student loan debt, and low college completion rates. It seeks
to increase college affordability and accountability.