News: Federal Policy & Advocacy

Sens. Alexander, Jones Introduce FAFSA Simplification Act of 2019

Tuesday, October 22, 2019  
Posted by: Carrie Warick, Director of Policy and Advocacy
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This evening, Sens. Lamar Alexander (R-TN) and Doug Jones (D-AL) introduced the FAFSA Simplification Act of 2019, which streamlines the Free Application for Federal Student Aid (FAFSA) and allows for early awareness of Pell Grant eligibility. If enacted, this bill would allow families to understand a student’s possible Pell eligibility years in advance and to complete a far easier FAFSA when the time comes to apply for aid.

“NCAN has long advocated for a streamlined FAFSA to lessen one of the barriers faced by many first-generation students going to college. By combining this simpler FAFSA with a Pell Grant look-up table, we can show students, early in their decision-making process, that there is money to help them complete college,” said NCAN Executive Director Kim Cook. “We thank Senators Alexander and Jones for championing this issue and the students we serve and are pleased to support this bill.”

NCAN looks for the following top priorities in FAFSA simplification proposals:

  • A fast-track process for students from low-income backgrounds who have already demonstrated their need to the federal government.
  • A Federal Methodology that does not require middle-income families to answer complicated questions about asset information.
  • A Federal Methodology heavily focused on financial information that is already available from the IRS.
  • A form that remains universal and provides enough information for states and institutions to continue using it to distribute their aid.

The FAFSA Simplification Act of 2019 achieves all of these objectives. Students from non-tax-filing families would be able to confirm their status within the FAFSA, eliminating the need for them to answer financial questions. Middle-income families would not be required to answer asset questions unless their adjusted gross income is over $75,000 or they filed certain lettered tax schedules. High-income families would also answer fewer questions, with nearly all financial questions transferring from the IRS. Additionally, barrier questions such as past drug convictions and selective service registration, would be eliminated. Finally, the bill would replace the Expected Family Contribution with a new calculation, the Student Aid Index, but this would still maintain the universality of the form.

In addition to simplifying the FAFSA filing process, the FAFSA Simplification Act of 2019 allows for the creation of Pell Grant look-up tables in the form of consumer-tested electronic tools. The new ability to create these tools derives from a switch in the Pell Grant eligibility formula, which would now be based solely on adjusted gross income and family size, rather than the longer needs analysis formula currently used.

According to NCAN member Kristina Scott, executive director of Alabama Possible:

“One of the biggest reasons students and families don’t complete the FAFSA is that they don’t think they will be eligible for any financial aid. This is true even for Pell-eligible families. With the FAFSA Simplification Act implementation of simple, clear Pell Grant look-up tables, we will be able to talk with students beginning in middle school about aid for which they should be eligible and how to access it by completing a shorter, simplified FAFSA. These two changes can shift the conversation about postsecondary education from ‘if’ to ‘when’ for low-income and first-generation college-going students and their families.”

The final change this bill would implement would adjust the Federal Methodology from the Expected Family Contribution to something called the Student Aid Index. This change allows for the simplified Pell calculation while still allowing states and institutions to receive enough information to distribute their aid resources.

The National Association of Student Financial Aid Administrators (NASFAA) also supports this legislation. NASFAA President Justin Draeger offered the following on the bill:

“Taking into account feedback from financial aid professionals nationwide, this bill takes a commonsense approach to shorten the FAFSA application to an extent that would not deprive institutions of crucial information needed to appropriately disburse billions of dollars of financial aid to eligible students. In short, this bill makes the process of applying for student aid much easier for all students, but the biggest positive impact will be for our nation’s neediest students.”

There are two key differences between the Student Aid Index (SAI) and the Expected Family Contribution (EFC):

  1. The SAI is not used at all in Pell Grant eligibility. Eligibility will be determined by adjusted gross income and family size in relation to the federal poverty guidelines.
  2. The SAI value can be as low as -$1,500. This change allows for more nuance among those not expected to contribute to their higher education costs but also demonstrates which students need additional support beyond the cost of attendance.
    1. Non-tax-filers will automatically receive an SAI value of -$1,500.
    2. Means-tested benefit recipients and maximum Pell Grant recipients will automatically receive an SAI value of $0, at most (or lower, if determined by the formula).

While explaining the new Student Aid Index will require adjustments from college advisers and school counselors, new students would still have the same experience of needing to understand two numbers from the Student Aid Report: one that shows their Pell Grant size and another that communicates with states and institutions their relative ability to pay for college.

NCAN member Stacy Lightfoot, vice president of college and career success for the Public Education Foundation of Chattanooga-Hamilton County, shared her personal experience and outlook on these possible improvements:

“Completing the FAFSA, for as long as I can remember, is a daunting process – one that my mother needed help with over 20 years ago for my sister and me. Now, the FAFSA is even more complex for families, especially those from underserved backgrounds, who get lost answering over 100 questions on the form. Senator Alexander’s and Jones’ proposal to simplify the FAFSA is long overdue and has been thoughtfully created to ensure better access to college by eliminating unnecessary and irrelevant questions. The new bill takes the most intimidating aspect of the college process away for students.”

Whether it is part of the long overdue Higher Education Act reauthorization, or continues as a standalone bill, NCAN looks forward to discussing these ideas with congressional offices, our members, and our partners such as NASFAA to ultimately bring about FAFSA simplification and early awareness that serves our students well for years to come.

(Photo by Andy Feliciotti on Unsplash)

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Oct. 23, 2019: This article has been updated to include a link to the full text of the FAFSA Simplification Act of 2019 as well as C-SPAN video of Sens. Alexander and Jones introducing the legislation.