New plan makes it easier for US college students to apply for federal aid

Obama administration hopes to help ‘hundreds of thousands’ pay for college under new rules for Fafsa, which many say is needlessly complex

Aspiring college students will soon have more time to apply for federal aid grants, a move the White House hopes will help “hundreds of thousands” pay for college.

A new plan is intended to make it easier for families file for federal aid under the Free Application for Federal Student Aid (Fafsa), an important but some say needlessly complex form that determines eligibility for federal student loans and Pell Grants.

Critics say families struggle to complete the complicated application process in the tight window between filing their taxes and submitting the form.

Starting in 2016, students will be able to apply for student aid in October, when the college application process begins, rather than having to wait until January. Students will also be able to use tax records from two years earlier to calculate financial need, rather than waiting for tax season to file.

Secretary of education Arne Duncan said the changes would help families and students calculate the “true cost” of college sooner, and make more informed decisions about what college to attend and how to pay for it.

“We believe literally hundreds of thousands of additional students will actually gain access to critical student aid each year because more students and their families will find it it easier to apply for that aid,” Duncan said in a call with reporters.

Duncan said the Obama administration had taken steps to simplify the application form.

Previously, he said: “You almost had to have a degree in accounting to complete it.”

Duncan added that the administration had reduced the time students and families spent completing the form each year to 20 minutes, down from an average of one hour.

The president was set to announce the plan in Des Moines, Iowa, during a visit to a high school. Over the weekend, Obama announced the College Scorecard, a new tool that uses IRS data to help students search for information about how well alumni fare after graduation.

Duncan said the simplified application process would increase diversity at four-year institutions, by helping low-income students and those who are the first in their family to attend college or who are new to the country.

“This is a very important step in the right direction but to be very clear, we’re not done,” Duncan said. “We want Congress to work and simplify the form even further.”

The debate over how to simplify the financial aid system has engaged lawmakers and interest groups.

US senator Lamar Alexander, a Tennessee Republican who chairs the Senate education committee, said he endorsed the changes the administration has made to the application process, but said such changes could have been made earlier.

“Congress gave the president authority to do this in 2008,” he said in a statement. “A bipartisan group of senators have been urging this for two years and intend to include it in the reauthorization of the Higher Education Act this year, including a way to pay for it.”

Alexander has proposed legislation to shrink the 100-question form to one the size of a postcard containing just two questions: a student’s family size and household income for two years prior. Less radically, Obama has proposed a plan to remove at least 30 questions about assets and additional income.

Duncan said it was “insane” that millions of students did not receive financial aid for which they were eligible because the form was too complicated.

According to a recent analysis by Mark Kantrowitz, publisher of Edvisors.com, two million undergraduates who would have been eligible for financial aid did not file a Fafsa application in 2011-12, the most recent data available.

If they had filed an application, those students would have qualified for as much as $9.5bn in Pell Grants, and an additional $2.9bn in state and institutional grants.

Kantrowitz also found that the earlier students filed the Fafsa form, the more aid they received. Students who filed in the first few months of the application cycle received on average more than twice as much funding as those who filed later.

Obama’s initiative was welcomed by the higher education community. But some were careful not to overstate the impact the changes would have.

College affordability has emerged as a key issue in the 2016 election, as tuition rates have risen rapidly, forcing students to take on the highest debt burden in generations.

According to the College Board’s Trends in Student Pricing report, US students have accumulated nearly $1.3tn dollars in debt while the average price for in-state students at public four-year universities has risen by 42% in 10 years.

“While students are going to get more help, at the same time, the maximum Pell Grant is going to cover the smallest percentage of the cost of education in decades,” said Tom Allison, deputy policy and research director of Young Invincibles, a national nonprofit that focuses on empowering young Americans.

“What we really need to do is to bolster the Pell Grant to reflect the average in-state cost at a four-year institution.”

Contributor

Lauren Gambino in Washington

The GuardianTramp

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