Lawmakers Urge Senate Appropriators to Increase Federal Funding for FSA

By Maria Carrasco, NASFAA Staff Reporter

Seventeen senators on Sunday sent a letter to Senate appropriation leaders urging them to increase funding for the Office of Federal Student Aid (FSA), noting that increased funding is necessary for the office to “implement critical programs.”

The letter, addressed to Sens. Tammy Baldwin (D-Wisc.) and Shelley Moore Capito (R-W.V.), leaders of the Senate Appropriations Subcommittee on Labor, Health and Human Services, Education, and Related Agencies, asked for $2.7 billion to be appropriated to FSA in the Senate’s fiscal year (FY) 2024 budget proposal. That’s the same amount that President Joe Biden proposed for the office in his FY 2024 budget earlier in March. 

The letter was signed by 17 senators, including Sens. Elizabeth Warren (D-Mass.), who spearheaded the effort, and Bernie Sanders (I-Vt.), chair of the Senate Health, Education, Labor, and Pensions (HELP) Committee. The senators drew attention to the number of major endeavors FSA will be undertaking — including the FUTURE Act, the FAFSA Simplification Act, and improvements to the Public Service Loan Forgiveness (PSLF) program —  and said the additional funding is needed to ensure a smooth implementation. 

“Fully funding the President’s request for FSA this fiscal year — a $620 million increase from FY 2023 — is particularly critical given that FSA’s FY 2023 funding was stagnant from the previous year, which severely undermines FSA’s ability to implement critical programs,” the lawmakers wrote. 

The lawmakers highlighted several other programs and initiatives that they said will warrant an increase in funding, including a new income-driven repayment (IDR) plan, Biden’s student loan debt cancelation plan, and returning borrowers to student loan debt repayment after a three-year pause, among other things. Additionally, they warned against flat funding for FSA, noting that it's unclear if the office has the resources to restore borrowers from default to good standing through the Fresh Start program or process borrower defense applications. 

The lawmakers added that because of last year’s flat funding, which gave FSA $2.03 billion, there have already been delays with FAFSA simplification. Specifically, FSA announced earlier in March that the 2024-25 FAFSA will be released in December 2023, when it traditionally has been released on October 1. 

“FSA’s responsibilities have increased to protect students and borrowers, but its federal funding has remained stagnant,” the lawmakers wrote. “The lack of adequate resources creates more barriers for students to continue their education. We believe this funding request is needed to provide FSA with the resources it needs to fulfill its goal of ensuring that all eligible students and families can access federal student grants, loans, and work-study funds to pursue education and training beyond high school.

In March, NASFAA President and CEO Justin Draeger applauded the Biden administration for proposing increased funding for FSA in its 2024 budget proposal, noting that there is a lot of work that needs to be done to transition millions of federal student loan borrowers back into repayment.

“At a time when the Office of Federal Student Aid is already stretched thin and is implementing many critical initiatives, it cannot be understated how important it will be to ensure that the agency has the necessary resources to complete these monumental undertakings,” Draeger said


Publication Date: 4/11/2023

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