The Latest FAFSA Problem Is ‘One Giant Step Back’

"About 20 percent of 6.6 million federal-aid forms processed so far this year include inconsistent tax information, the U.S. Department of Education announced on Monday night," The Chronicle of Higher Education reports.

..."If all that seems clear, then you’re ahead of some financial-aid officers who were scrambling to make sense of the announcement on Tuesday.

'Many of our members are saying, ‘Why didn’t they just reprocess every applicant who was affected?’ Karen McCarthy, vice president for public policy and federal relations at the National Association of Student Financial Aid Administrators, or NASFAA, told The Chronicle. 'But it’s clear, when you read the announcement, that the department is trying to not have to reprocess so many FAFSAs, which could really cause everything to grind to a halt, while still allowing schools to adjust if they want to. But there are all these convoluted steps. The department is sending out this list of applicants who don’t have these issues, so then schools are somehow going to do, I don’t even know what yet, with that list.'

The situation puts financial-aid staff in a strange position. Here’s the federal government telling colleges that they’re free to decide whether to base financial-aid offers on ISIRs that contain errors.
'We have heard that concern from a lot of our members, mostly because they do view part of their role as being a good steward of federal funds,' McCarthy said. 'Also, depending on how big the discrepancy is, if a college doesn’t make an adjustment, and the student gets more aid this year based on this incorrect information, what happens next year when they come back and say, ‘Now I’m not eligible for the same aid, but nothing has changed’?'

The latest problems with FAFSA data follow another tax-information headache. In late March, the department announced that a technical problem had caused inaccurate estimates of aid eligibility for about 200,000 dependent students who had reported assets on their FAFSA. The department clarified on Monday that, for that batch, too, it now plans to reprocess only forms for which corrected data would reduce an applicant’s SAI, increasing their aid eligibility.

Justin Draeger, president and chief executive of NASFAA, said in a written statement on Tuesday that the rollout of the new FAFSA had been 'plagued by issues of broken trust, data integrity, and missed deadlines.' Though Draeger said that the department had moved quickly to investigate reports of mismatched data, he reiterated what every college official should know right now: Every day counts, hundreds of thousands of FAFSAs need reprocessing, and many students must contend with more delays. 'Continually taking two steps forward and one giant step back is not a sustainable pathway toward getting financial-aid offers out to students and families,' said Draeger."

NASFAA's "Notable Headlines" section highlights media coverage of financial aid to help members stay up to date with the latest news. Articles included under the notable headlines section are not written by NASFAA, but rather by external sources. Inclusion in Today's News does not imply endorsement of the material or guarantee the accuracy of information presented.


Publication Date: 4/3/2024

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