Washington Watch is written by AACC’s government relations office.
Student financial aid makes it possible for those who lack the financial means to attend college. To access that aid requires an application process. The fact that the application process is free has not, however, guaranteed its universal use. Whether looking at high school seniors or already enrolled postsecondary students, the story is the same, many do not complete the Free Application for Federal Student Aid (FAFSA).
Lackluster FAFSA Completion Rates
A study found that by not applying for aid, more than 600,000 high school students in the class of 2018 did not avail themselves of about $2.6 billion in Pell Grants. Current FAFSA completion rates by 12th graders vary by state from a low in Alaska of 32 percent to a high of 75 percent in Tennessee. For enrolled students, the overall rate for applying for federal student aid is 70 percent, with community college students at the lowest end at 62 percent. In comparison, 75 percent of both public and private non-profit, four-year students and 83 percent enrolled in private for-profit four-year institutions applied for federal aid.
There are many reasons for the lackluster FAFSA completion rates. Underlying the FAFSA simplification efforts at the federal level is the sheer length and complexity of the form. The Future Act, enacted by this Congress, removed 22 questions from the form and authorized the automatic transfer of IRS data to the U.S. Department of Education. According to an ED survey, about one fourth of community college students (24 percent) reported that they didn’t complete the FAFSA because they lacked information about how to apply or thought the forms “were too much work.” Almost twice as many (47 percent) said that they thought they were not eligible for federal aid. These responses indicate that lack of information and support were the biggest barriers to completing the FAFSA.
State Approaches to FAFSA Completion
The primary reason why Tennessee holds the top position for FAFSA completion rates is the state’s Promise program, a last dollar scholarship that requires FAFSA completion. Originally, only recent high school graduates were eligible but now it is also available to adults, covering tuition and fees for those seeking an associate degree or certificate at a community college. Just one percent below Tennessee is Louisiana with a 74 percent FAFSA completion rate. So far, it is the only state to require 12th graders to submit a FAFSA in order to graduate from high school. According to a recent Century Foundation report, in addition to Louisiana, Val Verde Unified School district in California also has mandatory FAFSA completion. Two other states have enacted similar legislation that will go into effect in 2020-21 in Illinois and one year later in Texas and 13 other states are in various stages of considering such legislation.
Assessing the Effectiveness of Mandatory FAFSA
There are some major limitations to the Louisiana policy. First, it is not mandatory but rather an opt-out approach, which, according to the authors is easy to use. Second, the policy applies to recent high school graduates and not all prospective students. Third, the measure is one of FAFSA submissions rather than completions, and the gap between the two is around six percent. Assessing the effectiveness of the policy on community college students is particularly limited because they are less likely to be recent high school graduates with access to guidance counselors or still dependent on their parents for financial support. Finally, a policy is only as good as its implementation.
Louisiana chose to hold over a hundred workshops to inform students and parents about the FAFSA. The report found that “appropriate and intentional information by schools to families is crucial.” Even though the opt-out waiver is easy, it must be submitted directly to the counselor, which, the study found prompts discussion about the value of going to college and having the financial resources to pay for it. Peer pressure also plays a role in FAFSA completions and helps increase college enrollment.
The study found some shortfalls to the policy, however, including the likelihood of high schoolers with undocumented parents to use the parental opt-out waiver instead of completing the FAFSA, which requires a Social Security Number. While these students are not eligible for federal student aid, they forgo state and institutional financial aid, whose eligibility is also determined by the FAFSA. Lack of English proficiency rather than socioeconomic status was found to be an impediment to FAFSA completion. By tagging FAFSA submission rather than completion with meeting the requirement, the policy does not address the problems with verification and timing, both of which affect low-income students most. While equity gaps in submission narrowed in Louisiana, they were sustained in completion rates.
Lessons from Louisiana
Because mandatory FAFSA is gaining in popularity, the report offers several recommendations for states to consider. These include: providing state investment and coordination as well as clear outreach to families; more support to undocumented, English Language Learner students, and others requiring assistance with verification; integrating colleges in the FAFSA completion efforts – Val Verde Unified School District partnered with its local community colleges; and, establishing a means to assess the impact of the policy.
The American Association of Community Colleges has long supported policies at the state and federal level that expand opportunities for community college students to obtain student financial aid and other assistance associated with student success.
For more information, contact Jolanta (J.J.) Juszkiewicz, director of policy analysis, at email@example.com.