FAST Act Proposes Systemic Solutions for Millions of Low-Income Students

June 19, 2014

By Elizabeth Morgan, Director of External Relations

U.S. Senators Lamar Alexander (R-TN) and Michael Bennet (D-CO) announced legislation today that would radically simplify the FAFSA and make other changes to help increase the low U.S. postsecondary completion rate for low-income students. The bill is named the Financial Aid Simplification and Transparency (FAST Act).

“The FAST Act includes many of NCAN’s recommended policy solutions to make college affordable and the college decision process more transparent for millions of students,” Kim Cook, NCAN’s executive director said. “These solutions would be transformational for students and for those individuals and organizations that support them through the complicated college admissions and financial aid process.” Ms. Cook spoke at the Capitol Hill event today where Sens. Alexander and Bennet explained their proposal to a group of Congressional interns.

In concrete terms, what could a two-question FAFSA mean for students? More money and more help with enrolling in a best-fit college, according to NCAN members from across the United States. 

“If the FAFSA were only two questions, hundreds more Denver (CO) Public Schools students would complete it every year and would thus be eligible for the Denver Scholarship Foundation scholarship,” Nate Easley, executive director of the Denver Scholarship Foundation, said. “Our college advisors would spend 70 percent of their time each spring on other key college transition activities rather than on helping families fill out the long and tedious form.”

Nancy Leopold, executive director of College Tracks in Bethesda, MD, said, “We would use the same level of staff and volunteer resources every year to help 60 to 80 more high school students get admitted to post-secondary programs with enough financial aid to attend.”

“If the FAFSA were only two questions long, it would allow and encourage tens of thousands of deserving and motivated students across our nation to attend and complete college and to enter our country’s workforce better prepared to take on high-paying jobs and to become productive and engaged citizens,” Colette Hadley, executive director of the Scholarship Foundation of Santa Barbara (CA), said.

Bob Giannino, CEO of uAspire, based in Boston, said, "It would allow the college access and success field to focus on helping young people, and their families, make more financially-informed decisions about college, rather than spending precious resources and time convincing them of FAFSA's importance or fixing mistakes due to its complexity."

Key aspects of the FAST Act include:

  • Eliminating the FAFSA. The bill would reduce the 10-page form to a postcard that would ask just two questions: What is your family size? And, what was your household income two years ago?
  • Informing students and families early in the process of what the federal government will provide them in a grant and loan. The bill would create a look-up table to allow students in their junior year of high school to see how much in federal aid they are eligible for as they are start to look at colleges. This change is referred to in the financial aid community as use of “prior prior” tax year information, because FAFSA applicants would use information from the income tax return filed during their junior year, rather than waiting for information from the return filed during their senior year. 
  • Streamlining the federal grant and loan programs. The bill would combine two federal grant programs into one Pell grant program and reduce the six different federal loan programs into three: one undergraduate loan program, one graduate loan program, and one parent loan program.
  • Enabling students to use Pell grants in a manner that works for them. The bill would restore year-round Pell grant availability and provide flexibility so students can study at their own pace. Both provisions would enable them to complete college sooner; continuous enrollment is proven to increase completion rates.
  • Addressing over-borrowing. The bill would limit the amount a student is able to borrow based on enrollment. For example, a part-time student would be prohibited from taking out a full-time loan. It would also allow schools to limit borrowing in certain well-documented situations, such as when the average earnings of program graduates do not justify large amounts of debt.
  • Simplifying repayment options. The bill would streamline complicated income-based repayment programs to increase their use from current low levels and decrease defaults by borrowers. 

“We’re encouraged by these early bipartisan discussions and think they bode well for the future of the bill,” Carrie Warick, NCAN’s director of partnerships and policy, said. “Specifically, we are pleased to see discussion of prior prior year tax data usage, restoration of a year-round Pell Grant program, and efforts to simplify the financial aid application process – issues that NCAN Executive Director Kim Cook stressed in her November testimony to the U.S. Senate Health, Education, Labor, and Pensions Committee.”

“One point that needs some additional discussion is how to make sure that states and colleges don’t create or lengthen forms for awarding their own aid, but we feel confident that there are ways to address this situation,” Ms. Warick said.

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