Streamlined FAFSA forms aimed at low-, middle-income college-bound students
The Obama administration announced Wednesday a streamlined edition of the Free Application for Federal Student Aid (FAFSA) form. The shorter, simpler, and user-friendly form, the White House said, will make it easier for low- and middle-income college-bound students to apply for financial aid.
“President Obama has challenged the nation to once again have the highest percentage of college graduates in the world,” Secretary of Education Arne Duncan said. “To do that, we need to make the college-going process easier and more convenient, and to send a clear message to young people as well as adults that college is within their reach. Simplifying the financial aid process is an important step toward reaching that goal.”
Some of the changes are already in place while others will be phased in over the following months. Secretary Duncan outlined how the changes would be implemented.
- Enhanced skip-logic used in the new web-based FAFSA will reduce user navigation for many applicants by more than 50 percent starting later this summer.
- In January 2010, students applying for financial aid for the ‘10 spring semester will be able to retrieve their relevant tax information from the IRS for simple completion of the online FAFSA. The DOE and the IRS will be working together to examine the possibility of expanding this option to all students in the future.
- The administration will also introduce legislation seeking statutory authority from Congress to eliminate financial information from the aid calculation formula that is not available from the IRS. This will remove 26 financial questions from the FAFSA form that have little impact on aid awards and can be difficult to complete. Only questions that rely upon information that applicants must already provide to the IRS would remain.
Streamlining the FAFSA process is one step the administration plans to take in the near future to improve access to post-secondary education:
- Expanding Pell Grants and College Tax Credits: The American Recovery and Reinvestment Act (ARRA) increased Pell Grants by $500 to $5,350 for 2009-2010 and created the American Opportunity Tax Credit, a new $2,500 tax credit for four years of college tuition. Obama’s 2010 budget would make these policies permanent and ensure the Pell Grant continues to grow steadily by making it an entitlement. Together, they provide approximately $200 billion in college scholarships and tax credits over the next decade.
- Modernizing and Expanding the Perkins Loan Program: The 2010 budget proposes to make this program available to over 2,600 additional schools and an estimated 2.7 million extra students each year. By providing an additional $5 billion in Perkins Loans and continuing a 5 percent interest rate, President Obama hopes that the neediest of students will have access to federal financial resources they did not have before.
- Creating a New College Access and Completion Fund: The 2010 budget proposes a five-year, $2.5 billion fund to build federal-state-local partnerships aimed at improving college access and completion, particularly for students from disadvantaged backgrounds. These funds would be used to evaluate programs aimed at increasing college enrollment and graduation, and to grow and bring to scale programs that are proven to be successful.
To help families in special circumstances, the DOE sent a letter in early April to financial aid administrators reminding them of their authority to make adjustments, on a case-by-case basis, to address circumstances, such as unemployment, not reflected on the original application.
Earlier this year, the president challenged Americans to commit to at least one year or more of higher education or career training so the United States, by 2020, can have the highest percentage of college graduates in the world.
The Middle Class Task Force, led by Vice President Biden, has asked the Treasury Department to come up with ways for 529 savings plans to help families save more for college.