On Tuesday the Department of Education (ED) opened a 60-day comment period on a proposed new information collection by which institutions will be required to report individual students’ Federal Work-Study (FWS) earnings through the Common Origination and Disbursement (COD) system. While previous mention of this new reporting requirement referred only to collecting the student’s calendar year FWS earnings, the documents published this week indicate that several additional FWS-related fields will be required for 2024-25.
For background, ED developed this new reporting process because of two FAFSA changes made by Congress in the FAFSA Simplification Act. The first change prohibits ED from asking additional questions beyond a list specified in Section 483(a)(5), where FWS earnings are not included. The second change, in Section 483(a)(2)(F), requires ED to “take steps necessary” to collect applicants’ FWS earnings data without adding a question to the FAFSA, “including by collecting such information from institutions.”
FWS earnings are necessary to calculate the Student Aid Index (SAI) because they will continue to be treated as an exclusion to income in the SAI calculation as they are currently in the Expected Family Contribution (EFC) formula.
While the statutory changes apply to the 2024-25 FAFSA, they refer to calendar year 2022 FWS earnings since prior-prior year data is used. ED officials indicated at the Federal Student Aid Training Conference (FSATC) that institutions would be required to report 2022 FWS earnings prior to the launch of the 2024-25 FAFSA, which ED is required by law to release by Dec. 31, 2023. FWS earnings data will then be sent from COD to the FAFSA Processing System (FPS) (currently referred to as the Central Processing System, or CPS) to be used in the SAI calculation.
ED includes in its supporting statements a schema flow for a new Campus-Based Schema they indicate will be built in COD, which will enable FWS earnings reporting in batches. Institutions will also have the ability to report and/or update individual student FWS earnings directly in COD.
While reporting is mandatory for the 2024-25 award year, institutions may choose to report FWS data to COD beginning July 1, 2023 provided they are using schema version 1.0a.
While the Federal Register notice and supporting statements refer only to the collection of work-study earnings data for SAI calculation purposes, ED includes as an attachment the 2023-24 COD Technical Reference, which was significantly changed on March 1, 2023. There, ED adds a new chapter for reporting campus-based aid data which includes significantly more data elements than just FWS earnings.
New COD fields include the earnings period start and end date as well as federal and institutional share amounts. There are also several fields indicated as “for future use only,” including FWS category (e.g., on campus, off campus, nonprofit, for-profit), FWS position type (e.g., reading tutor, math tutor), Community Service Indicator, and Disaster Indicator (whether the student has been impacted by a disaster designation).
ED also includes in the March update to the COD Technical Reference a number of new fields, also indicated for future use only, related to Federal Supplemental Opportunity Education Opportunity Grant (FSEOG) reporting to COD. Those include individual FSEOG award amounts and institutional and federal shares. It is not clear at what point in the future ED intends to begin using the FWS and FSEOG fields flagged for future use.
ED anticipates an institutional burden estimate of four hours for reporting FWS data, which they indicate includes consideration of the fact that some institutions track FWS earnings in a system other than their financial aid management system and may require some level of manual processing to report FWS earnings data to COD as a result.
While institutional FWS reporting will need to take place prior to the release of the 2024-25 FAFSA sometime before the end of 2023, ED did not include reporting deadlines in the documents it published on Wednesday. Institutions should, however, begin preparations as soon as possible to identify the method by which they can extract FWS earnings data from other systems in a way that will enable them to provide that data to COD.
Comments are due May 15, 2023. Please share your concerns with NASFAA, as well as your own comments if you choose to submit them, to [email protected]. ED will also conduct a subsequent 30-day comment period on this topic following the conclusion of the current comment period.
Publication Date: 3/16/2023