Bipartisan FAST Act Officially Introduced

 Reauthorization - Masthead  

By Megan McClean, Policy & Federal Relations Staff 

Yesterday, Senator Lamar Alexander (R-TN), new Chairman of the Committee on Health, Education, Labor and Pensions (HELP), along with Senator Michael Bennet (D-CO), officially introduced the Financial Aid Simplification and Transparency (FAST) Act. The bill, released last summer in the form of a discussion draft, would dramatically simplify the federal financial aid system while improving transparency and access. The FAST Act also includes many issues for which NASFAA has been advocating.

As a reminder, the FAST Act would:

  • Eliminate the Free Application for Federal Student Aid (FAFSA) and utilize prior-prior year (PPY) data. The application would be reduced to two questions:
    • What is your family size?
    • What is your household income (adjusted gross income) from two years prior?  
     
  • Provide early information for students and families through a “look-up” table that students and families would have access to as early as the beginning of the junior year of high school.
  • Establish a one-grant/one loan program.
  • Make the Pell Grant more flexible by restoring the year-round Pell Grant.
  • Provide some authority for aid administrators to be able to limit loan amounts on a categorical basis in certain well-documented cases.
  • Prorate loans based on enrollment status.
  • Streamline repayment plans into two programs: one income-based repayment plan and a 10-year repayment plan.

Prior coverage from NASFAA provides a more detailed analysis of the bill.

NASFAA has advocated heavily for several provisions that appear in this bill, including a move to PPY, the restoration of the year-round Pell Grant, and the authority for aid administrators to limit loan amounts on a broader basis than is currently allowed.

This is the first reauthorization-related bill to be introduced in the new 114th Congress and Congress has a long way to go before a full reauthorization bill is near completion. Stay tuned to Today’s News for updates on the FAST Act and other reauthorization efforts.
 

 

Publication Date: 1/8/2015


William M | 1/8/2015 2:38:33 PM

The less information we have to work with, the less we are able to determine who has genuine need. The less we know about the student's genuine need, the more aid we provide to those don't have genuine need. The more aid we provide to those who don't have genuine need the less aid that is available for those who actually have genuine need. This move to make the process simple is working against our desire to provide access to higher education for those for whom the cost is the primary barrier. Any good accountant can manipulate an Adjusted Gross Income for a couple of years for those who are self-employed.
At last report, the federal government was in debt of 18 trillion dollars. Providing grants and subsidized loans to people who don't need grants or subsidized loans is perhaps not a good way to invest the nation's resources.

Sheree B | 1/8/2015 11:55:42 AM

The biggest problem is that this is going to be wildly inaccurate. PPY data is not an accurate reflection of the current financial situation. Also, a two question FAFSA does not take into account untaxed income or assets. It would be a misuse of funds to give full Pell to a student with assets and resources who has a low AGI due to not working.

There is also the problem of universities who use FAFSA information to determine student need for institutional aid. Without this information, students will most likely have to complete a second application at the university that they are applying to in order to qualify for additional aid, making the two question FAFSA completely pointless.

Simplifying the FAFSA is a good idea that will encourage more participation; however, we have to be careful not to go overboard with simplification to the detriment of federal aid programs.

Theodore M | 1/8/2015 10:0:19 AM

oops I meant how do we know not who.

Theodore M | 1/8/2015 9:21:47 AM

The big problem I see with the two question FAFSA is that you don't know who it is for. Since we are not asking for any identifying information, who do we know who to fund?

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