Report: 6 Ways To Change Financial Aid To Support Community College Students

By Katy Hopkins, Communications Staff

A new report from New America suggests a variety of financial aid reforms that would better help community college students to earn their degrees, including a return of the year-round Pell Grant and authority for financial aid administrators to limit loans.

In “Community College Online,” New America senior policy analyst Rachel Fishman examines issues facing community college students – many of whom struggle to complete the programs they start. Among students who enrolled in a public, two-year college in 2006, about 64 percent who attended full-time had not earned a credential six years later, and even more part-time students—82 percent—had no credential by the end of that time period. 

To better help these students complete their education, Fishman makes a variety of recommendations, some of which directly address student aid. To transform the financial aid system from “a relic from a time when most students entered higher education directly from high school and attended residential institutions from September until May” to one that supports today’s students’ needs for flexibility, Fishman’s recommendations include:

  • "Provide year-round financial aid.
  • Change the law so that federal financial aid can be provided to students who want to take a mix of competency-based and seat-time courses.
  • Allow federal financial aid to be used for competency-based developmental education.
  • Allow adult students to be eligible for state financial aid programs.
  • Provide emergency funding for students.
  • Help students access the benefits for which they are already eligible.”

NASFAA advocates for several proposals Fishman suggests, including a return to the year-round Pell Grant, which, with some reforms, Fishman notes would help students to earn their degrees sooner.

Fishman also calls for financial aid administrators to have the ability to limit loans.

“The administrator should ... be able to limit loans based on attendance status (i.e., half-time versus full-time) to prevent students from exhausting aid eligibility before they achieve their educational goals,” Fishman writes.

NASFAA has long advocated for authority for financial aid administrators to limit borrowing for cohorts of students. 

For more details, see Fishman's full report online. New America plans to also host an accompanying event, originally scheduled this week and postponed for inclement weather. Stay tuned to NASFAA's D.C. Docket for the new date. 


Publication Date: 2/19/2015

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