U.S. Department of Education Secretary Margaret Spellings announced on Oct. 2 a draft two-page simplified FAFSA to make it easier for students to apply for federal student.

Under Spellings' proposal, the FAFSA would be reduced from 100 questions to 26, and students would learn how much aid they might qualify for before their senior year of high school, according to the Department.

Financial aid administrators and other financial aid experts have had mixed reactions to the proposed application and expressed concerns about the potential impact of this simplified FAFSA. Everyone expresses appreciation for the Department's efforts to simplify the form, but there is disagreement about the right way to do it and everyone seems to be able to find problems with the latest proposal.

How Simple is the Simplified Form?

Some financial aid administrators are excited about the proposed FAFSA and believe it is short, clear, and simple enough that students and families won't be discouraged by an unnecessarily complicated application.

However, some question how simple the draft application is.

Bob Shireman, Founder and President of The Institute for College Access and Success (TICAS), argued that the type of questions removed may be more important than the number of questions removed.

"Focusing on the raw number of questions is sort of like looking at test scores without context. Families don't mind having to answer easy questions like their street address or whether they have other children already in college," Shireman wrote in a blog posting on the TICAS Web site. "The goal should be to eliminate the difficult, show-stopper questions that require the applicant to do research or to be a tax expert. To accomplish that goal, the Department will have to go beyond this first step."

Sufficient Information

FAFSA simplification can't be discussed without considering whether a simplified application gathers enough information to accurately determine students' and families' ability to pay for college. Additionally, there has always been concern that if the FAFSA is simplified, states and institutions will have to require additional applications for aid, causing a net increase in the complexity of applying for aid.

Marie Bennett, director of the National Association of State Student Grant and Aid Programs (NASSGAP), warned that eliminating questions that determine a student's ability to pay could hurt low-income students.

"Without all of the current income and asset information, more students may qualify for a lower, even a zero, EFC," she said. "This will result in the same amount of finite grant resources being spread across a larger population because the current economic crisis will not allow for increased grant appropriations."

One NASFAA member noted that the new form might work well for low-income students, but it would make it difficult to evaluate middle- and upper- income students' ability to pay for their education. However, it is not clear who this draft form is targeted to. If it is only for those who qualify for an auto-zero EFC or a simplified needs test, it might calm concerns about eliminating asset questions. But, the form does not make it clear who can and can't use it.

Other NASFAA members were not as concerned that the form did not ask about assets because the current system does not do a great job of evaluating need, so it might not matter.

"There are now so many exceptions for reporting assets that these questions become irrelevant in most cases," one member noted. "Would there be some 'leakage' in the program with this simplified FAFSA? Yes, but it exists now anyway."

Bennett also expressed concern that the draft FAFSA would ultimately increase the complexity of the application program.

"We can agree that eliminating some questions on the FAFSA that do not go to the matter of need analysis for federal or state programs can be improvements," she said. "However, any loss of financial data erodes the ability to determine and compare 'ability to pay' among the applicants."

She said that all the financial aid program stakeholders will have to work together to ensure that simplification does not result in multiple student aid applications. NASSGAP is reviewing the questions that the states view as critical, according to Bennett. She encouraged other stakeholders to do the same.

NASFAA members also expressed concern about some of the questions eliminated in the draft application. Members highlighted following areas of the new application as possibly problematic:

• It asks for the students or parent's income, not both.

• Emancipated minors, students with legal guardians, orphans, foster care kids, and homeless kids are dropped from the dependency status question which would cause more need for professional judgment overrides.

• If those who don't qualify for auto-zero EFC or a simplified needs test could use this form, it would lower the EFC for families that may have low incomes but have a large amount of assets.

• It does not ask when a student became a resident of a state, which might lead to states requiring an extra application for state aid.

• It eliminates questions about parents' level of education, which could make it hard to identify first-generation students.

• It could make it easy for students who already have a bachelor's degree to receive a Federal Pell Grant even though they are ineligible.

• The form does not ask for grade level. Currently, BANNER pulls the grade level from the FAFSA for awarding purposes.

Excess Questions

Many members felt that the proposed simplified FAFSA included two questions that could be eliminated. They felt that it would be a good opportunity to eliminate the Selective Service and drug conviction questions.

"It is inappropriate for financial aid professionals to be involved in registration for Selective Service and even more inappropriate for financial aid professionals to be responsible for punishing students who did not register or who have a drug conviction," one member said. "That is the job of the Selective Service and the court system."

Eliminating Questions Raises Questions

The proposed FAFSA has sparked a variety of questions about how this form would work. Many thought the proposed form would require Congress to pass additional legislation just to implement it.

One member questioned if the federal formula used to determine need would need to be changed to accommodate having such limited information. "Will we be required to collect more data and determine the EFC?" the member wondered.

"It appears to me the simplified application will completely wreck the EFC calculation," another asserted.

Other Solutions

Generally, the majority of financial aid administrators NASFAA has heard from seem unsatisfied with the proposed application, but for very different reasons. In addition, the current application is also generally seen as unsatisfactory - leaving students, parents, financial aid offices, and the Department in a tough position.

"There is much work to be done to better meet the needs of students and families by the use of technology to ease the collection of data and increase the capacity to understand the data we do collect," Bennett said, echoing a sentiment expressed by many aid administrators.

Many would still like to see some sort of verification using IRS data so institutions and students don't have to wrestle with this significant challenge.

However, others are quick to point out that this solution would raise different problems that can't be ignored. There seems to be no silver bullet solution.

As a part of its National Conversation Initiative (NCI), NASFAA is holding listening sessions to explore potential solutions to the question of simplification and other college access issues. Financial aid administrators nationwide are urged to participate in this campaign in person or by sending recommendations to NASFAA. Please see the NASFAA Web site for more information about NCI and how you can become involved.

By Haley Chitty
NASFAA Associate Director of Communications

Posted 10/27/08 to www.NASFAA.org. Redistribution to non-NASFAA institutions is prohibited. Please submit Web Site questions or comments to Web@NASFAA.org.