FAST Act to simplify FAFSA application raises concern from students
Several students recently voiced their concerns with a new bill introduced by Senator Lamar Alexander (R-TN) and Michael Bennet (D-CO) in January that proposes to significantly restructure how the federal government helps students pay for college.
Drafted last June, the Financial Aid Simplification and Transparency (FAST) Act of 2015 would amend the Higher Education Act of 1965 to simplify the application and disbursement process, establish a one-loan and one-grant program, discourage excessive borrowing, and simplify federal loan repayment options.
The measure would shorten the FAFSA to only two questions about household size and income of two years ago. Based on this information, families would be able to estimate their eligibility for federal aid ahead of time by checking a table. For example, the current draft would award a student in a family of four earning up to $23,850 the full Pell Grant of $5,730. This amount declines gradually as income rises, and a family of four earning up to $59,625 would be eligible for the minimum grant, totaling $2170.
Though a simplified FAFSA might help create more transparency in the federal aid process, and law requires institutions to use FAFSA data, the vast majority of aid is institutional, according to Associate Vice President of Federal Relations Scott Fleming.
“Georgetown’s institutional financial aid accounts for a much greater proportion of financial aid Georgetown students receive than federal aid,” he wrote in an email to the Voice. “Having said that, we do consider the various federal financial aid programs an important part of Georgetown student aid packages.” Georgetown would continue to require the CSS Profile, a form much longer than the current FAFSA, from all students applying for institutional aid.
The “one loan, one grant” model would terminate existing loan programs and the Supplemental Education Opportunity Grant (SEOG) Program. The bill would affect the nearly 200 undergraduates receiving Perkins loans and the 337 students receiving up to $4000 each in SEOG grants, according to Fleming.
“The reality is that the so-called simplification would mean, to many students here at Georgetown and around the country, less federal financial aid,” he wrote. “The University would have to repay the federal contributions to the [Perkins Loan] fund back to the Treasury, thus reducing that pool of lending.”
Five students from College Democrats spoke on Feb. 27 to the education policy advisor of Sen. Patty Murray (D-WA) about the possible student loan reform. “The FAST Act contained both great and troubling proposals that we hoped to address to senators on the Health, Education, Labor, and Pensions (HELP) Committee,” according to College Dems outreach coordinator Tracey Zhang (SFS ‘17).
Students were concerned with the proposal to decrease the federal aggregate borrowing limit of $57,000 by $20,000. The bill would also eliminate all repayment methods except the standard 10-year and the income-based repayment plans.
As Georgetown tuition is set to rise by 4% next term, “it is becoming even more important that students have access to loans at affordable rates,” Zhang wrote. “Although the FAST Act has a very small chance of passing, we’re hoping some of the positive elements of the bill show up in the Higher Education Act reauthorization.”
Officially, the College Democrats organization was not involved in the lobbying effort. According to Zhang, “members of the student loan advocacy team decided to pursue the initiative.”
Nevertheless, the lobbying effort continues to reflect the high involvement of Georgetown students with Capitol Hill. “We’re hoping to show members of the Hill that college students do have a voice and care about what will happen with regard to student loan reform. It is such a pertinent issue that will affect all of us students in the upcoming years.”
Photo: Cliff via flickr