Universal FAFSA has become a popular state policy approach for increasing Free Application for Federal Student Aid (FAFSA) completion rates across the country. As of January 2, 2024,
about a dozen states have passed universal FAFSA policies. Each state’s language differs, but the policy’s general requirement is that high school seniors complete a FAFSA (or state financial aid form equivalent) or submit an opt-out form to receive
their high school diploma.
While 11 states have passed universal FAFSA policies, another 13 or so proposed universal FAFSA bills but have
been met with pushback that stalled or killed the bills. One concern the National College Attainment Network (NCAN) has heard from universal FAFSA opponents is that the policy could act as a barrier to high school graduation by reducing the number
of students who are able to obtain their high school diploma. Even though each universal FAFSA bill that has passed includes an easily obtainable opt-out form that students, parents, and/or school administrators or counselors can complete in lieu
of the FAFSA, concerns around high school graduation persist in states considering adopting a similar policy.
NCAN examined state education agencies’ high school graduation rate data around the years of universal FAFSA implementation in Alabama, Illinois, Louisiana, and Texas. The charts below show each state’s data from the years before, during, and, where
available, after the implementation of universal FAFSA. The circled data points represent the year when the policy was implemented in each state. We also asked our partners in these states about what they have observed anecdotally regarding graduation
rates.
There are two important notes about this analysis. First, while there are more states who have adopted universal FAFSA policies, the policies either have yet to be implemented or have been too recently implemented for us to be able to pull sufficient
data. More insight on those states to come! Second, this is a basic look at state-level descriptive data; a deeper analysis by high school demographics or characteristics might reveal something different, and NCAN welcomes those analyses!
So, what do the data tell us about universal FAFSA policies and high school graduation rates? Let’s take a look!
Louisiana
Louisiana was the first state to implement universal FAFSA starting with the class of 2018 and consequently has the most data points before, during, and after implementation. Based on the eight years of data we gathered, Louisiana saw over a 3% increase
in high school graduation rates in the first year of implementation. Graduation rates have remained significantly higher than in the years prior to universal FAFSA implementation.
“Since inception of the policy we have had no student who has not graduated due to the policy. All have either filled out a FAFSA, a TOPS application, parental waiver or hardship waiver.”
Stephanie Hernandez Marcum, Executive Director of Postsecondary Readiness, Louisiana Department of Education
Illinois
After implementing its universal FAFSA policy for the class of 2021, Illinois saw a minimal 1.2% decrease in high school graduation rates. Graduation rates have been steadily increasing since the first year of implementation. Notably, the effects of Illinois’
implementation of universal FAFSA are confounded by the difficulties faced nationwide by the class of 2021 due to the COVID-19 pandemic.
Texas
Since Texas is one of the more recent states to implement universal FAFSA, we only have data from the class of 2022 to understand the effects from the first year of implementation. High school graduation rates dropped a mere 0.3% in the year universal
FAFSA was implemented in Texas but were also on the decline previously from the class of 2020 to 2021. This analysis’ limitations do not address whether that 0.3% decline was coincidental with or caused by universal FAFSA.
"In Texas, the high school graduation rate held steady after implementing the Financial Aid Requirement. This achievement can be credited to the state's proactive approach in providing students with choices, enabling them to complete the FAFSA, TASFA,
or a Waiver. The waiver allowed for students 18 years or older, parents, or counselors to opt out the student of the requirement. The waiver flexibility catered to the needs of students and families who opted not to or faced challenges completing
the financial aid applications, mitigating the risk of non-completion and ensuring graduation for all Texas students."
Jennifer Torres, Deputy Director, Texas College Access Network
Alabama
Like Texas, Alabama implemented universal FAFSA for the 2021-2022 academic year, which means we are only able to look at data from the first year of implementation. With just a 0.05% graduation rate increase from the previous year, there was relatively
no impact on graduation rates for the class of 2022.
All Together Now!
While the effects of universal FAFSA on high school graduation rates differ across states, the impacts appear quite minimal. Universal FAFSA encourages as many students as possible to become aware of the federal financial aid for which they are eligible
to help pay for college. Without this knowledge, many students from low-income backgrounds may perceive accessing a postsecondary education as an unattainable dream.
As many of our readers know, NCAN endorses universal FAFSA with supports. We have identified it as a state policy priority and one of eight college
and career readiness policy levers that are a focus of NCAN’s ongoing systems change work.
NCAN’s recommendations to states who are considering universal FAFSA include:
Require FAFSA completion for high school graduation through legislative or other policy vehicles.
Include a robust opt-out system for students who are unable to access parental financial information, have undocumented parents, or whose parents allow them to abstain.
Provide (at minimum) one full FAFSA cycle from the bill passing, or the item being administratively added to a list of requirements before the actual requirement takes effect.
Make the change administratively if high school graduation requirements do not live in statute.
If not already in place, build and provide robust training and support through school counselors and/or college access advisers to ensure students are helped through the process.
Provide regular data-sharing on completion to high schools and community-based organizations to allow for better-targeted FAFSA completion efforts.
NCAN thanks college access leaders in Louisiana, Texas, Illinois, and Alabama for their insight on how universal FAFSA has impacted high school graduation rates in their state. We look forward to continuing to examine this policy from multiple angles
and with the addition of new states who adopt and implement universal FAFSA policies.
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