Trying to receive financial aid for college? How do you feel when completing the ten page FAFSA (Free Application for Financial Student Aid) form? Could reducing it to two questions improve the process? Senators Alexander (TN) and Bennett (CO) believe more students could pursue a college education if the form were simplified. They want to reduce FAFSA to a postcard that asks two questions: What is your family size? And, what was your household income two years ago? Using earlier tax data – and a simple “look up” table – would let students know how much financial aid they are eligible for when they start looking at colleges.
The Financial Aid Simplification and Transparency (FAST) Act proposes to streamline federal grant and loan programs by combining two federal grant programs into one Pell grant program and reducing the six different federal loan programs into three: one undergraduate loan program, one graduate loan program, and one parent loan program.
The bill would also restore year-round Pell grant availability so students who want to accelerate their education by attending college during the summer can do so. It seeks to discourage over-borrowing by limiting the amount a student is able to borrow based on enrollment: a part-time student could only take out a part time loan. It also seeks to simplify repayment options by streamlining repayment programs and creating two plans, an income based plan and a 10-year repayment plan.
Financial aid by the numbers: There are approximately 22 million students enrolled in more than 6,000 institutions of higher education in the U.S. In 2013, taxpayers lent more than $102 billion in new federal student loans to 10 million college students. 9.2 million students received a Pell grant in 2012-2013 with an average award of $3,477 and total federal expenditures of $33 billion.
Here’s what we know: college education is critical to the economic success of individuals, families, and communities. Financial aid plays a key role in providing access to college. Completing FAFSA is complicated and time consuming: many people give up. With bipartisan sponsors this proposed legislation could remove a barrier to education and increase access. We also know policy changes can have unintended consequences. When changes were made to the Parent PLUS loan program the consequences were devastating for students, their families and the colleges they attended. Many students could not complete their education because they were suddenly no longer eligible for these loans. Decreasing enrollment had a dramatic impact on colleges and universities with substantial numbers of first generation students. We don’t know what unintended impacts this legislation could have: we do know that when people come together we can find solutions.
To learn more contact Bob Moran, in Senator Alexander’s office – robert_moran@help.senate.gov or (202) 224-6770; or Juliana Herman in Senator Bennet’s office – Juliana_herman@bennet.senate.gov or (202) 224-1334.
Image credit to the US Department of Education
Mel and Pearl Shaw are the authors of “Prerequisites for Fundraising Success” and “The Fundraiser’s Guide to Soliciting Gifts.” They provide fundraising counsel to nonprofits. Visit them at www.saadandshaw.com. Follow them on Twitter: @saadshaw.