Given the delays, higher education observers are concerned about the new FAFSA

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The Free Application for Federal Student Aid (FAFSA) is the backbone of the federal financial aid system and a source of great frustration for millions of students, parents, high school counselors, and financial aid administrators. Perhaps the only thing worse than having to do the FAFSA is that it’s not ready or fully tested and any bugs fixed in time for the start of the October application season for financial aid.

Each year, the Office of Federal Student Aid (FSA), which is part of the Department of Education (ED), must update the online FAFSA form. They then have to test it, provide information about changes to the high school and college dean, and make sure the entire system is running smoothly before October 1, when applications open. This year, the task is even bigger because of the FAFSA Simplification Act, passed in late 2021, which changes key parts of the FAFSA form and its underlying formulas. Those changes, and the lack of a timeline for when the new form will be ready, have lawyers concerned that the revisions won’t be completed in time.

The FAFSA is the federal form you must fill out in order to qualify for financial aid from the federal government, your state, or one of the colleges you hope to attend. and is used by states and colleges to determine their eligibility for aid.

Late last year, the National Association of Student Financial Aid Administrators (NASFAA) and the National College Attainment Network (NCAN) wrote a letter to the Department of Education ED and the White House expressing concern that with all other priorities that ED and Managing FSA, FAFSA’s revisions are behind schedule.

FSA is currently managing a huge portfolio of changes to the higher education funding system, including the administration of the Biden debt cancellation plan, major revisions to income stimulus repayment plans, the government’s “Fresh Start” plan aimed at getting borrowers to pay back, and a host of key changes designed to improve student loan service, just to name a few.

Delays in launching the FAFSA could have significant knock-on effects on state financial aid programs and colleges, all of which rely on FAFSA to allocate their financial aid funds. Many state grant programs have priority deadlines, and a delay in launching the FAFSA could spell trouble for students who apply in time to qualify for state financial aid.

The changes required by the FAFSA Simplification Act are positive. The number of questions on the form will be reduced from over 100 to 38. More students are eligible for Pell Grants, although some students are seeing their eligibility for assistance reduced. In addition, some of the formulas used to calculate aid eligibility are changing.

These myriad changes are likely to lead to a significant increase in questions and concerns directed to financial aid agencies and college advisors. Prospective students will try to understand how the process works, and current students who see their eligibility change will want to understand why.

While it is possible, FSA is unlikely to miss the TBEN for launching FAFSA on October 1 this year. It’s more likely that the system hasn’t been tested enough, which could lead to problems for colleges, students, and the staff trying to support them.

The letter from NCAN and NASFAA contains several concerns. They are concerned, among other things, that critical deadlines for providing information and testing the system are two months later this year than in previous years. It is also feared that auxiliary administrators will have less time to set up their systems and processes properly and that this will make it more difficult to support students.

To prepare for the changes, financial aid administrators and college advisors need time to learn the new rules so they can educate students and families about how they will be affected. Without enough time to prepare, tens of thousands of financial aid administrators and college advisors will have a hard time providing adequate support to students trying to navigate the financial aid system.

The changes coming to FAFSA are almost all good. Simplifying the process and making more students eligible for Federal Pell Grants is undeniably good. However, change on this scale can be confusing and frustrating if the people in frontline staff positions don’t know what to expect and how to explain the consequences to students.

Hopefully, FSA and ED can provide the frontline workers who make the financial aid system work with the information they need to support students and families as they navigate the complexities of the financial aid system.

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