Cardona Outlines 'Full-Scale Review' Underway to Improve and Modernize FSA

By Maria Carrasco, NASFAA Staff Reporter

Education Secretary Miguel Cardona on Thursday sent a letter to staff members outlining steps the Department of Education (ED) will take to modernize and improve the Office of Federal Student Aid (FSA) amid “ongoing management and operational challenges.”

In the letter, Cardona wrote that FSA has had many changes throughout the years, including “fulfilling congressional directives under tight budgetary constraints” – alluding to the rollout of the FAFSA Simplification Act and FUTURE Act. This year’s rollout of the 2024-25 FAFSA has been tumultuous since its delayed launch, and continued glitches, errors, and technical issues. 

The rollout has also garnered pointed questioning from Democrats and Republicans, with the House Committee on Education and the Workforce hosting two hearings questioning FSA’s priorities during the rollout of the 2024-25 FAFSA, one of which included testimony from NASFAA President and CEO Justin Draeger. Cardona also faced bipartisan questioning during a Senate appropriations subcommittee hearing in April where members also expressed concern about the rollout’s impact on students, families and institutions.  

“Over the last three years, the Department and FSA have made great strides in making sure federal financial aid is put in the hands of students,” Cardona wrote. “However, changes are needed to make sure students, borrowers, and families have a better user experience with FSA, and we can achieve better outcomes for the millions of people we serve.”

One of those changes is a new Chief Operating Officer (COO) for FSA. In April, COO Richard Cordray announced he would be stepping down from his position in June. Cardona noted in his letter to staff  that Denise Carter has been named principal deputy COO of FSA as an interim leader and a search for a new COO has already begun. . 

Additionally, ED will do a “full-scale review” of FSA’s organization, management, staffing, workflow structures, business processes, and operations. ED will also review FSA's contracts and acquisition procedures in order to hold vendors accountable, Cardona wrote. 

Along with the “full-scale review,” ED has hired an independent firm to make recommendations to Cardona and FSA’s COO on ways to improve the organization, including how to build an updated organizational structure and workflow. Additionally, ED will restructure senior leader reporting protocols “to increase accountability and make sure we provide the best value to the agency and protect taxpayers’ resources.”

In 2017, NASFAA released a report that makes several organizational and structural recommendations for FSA in order to help the office meet its congressionally mandated objectives as a performance-based organization. 

Cardona also noted that ED will create a new IT innovation team to support “the digital transformation” of FSA. According to ED, this team will recruit engineers, project managers, and designers to strengthen information technology for FSA. 

ED will also be seeking input from the Office of the Inspector General (OIG) for a “holistic review,” and members of Congress in a “bipartisan fashion.” Additionally, Cardona noted that FSA will continue its “robust” outreach to parents, students, institutions, and community organizations, and it will host listening sessions with them this summer. 

“As we implement these changes at FSA, we remain committed to ensuring its core functions continue,” Cardona wrote. “From administering the FAFSA, awarding Pell Grants and campus-based aid, managing student loans, overseeing more than 5,000 institutions of higher education, and more—we are working tirelessly to help all students have access to the resources they need to attain higher education.”


Publication Date: 6/3/2024

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