Editor’s note: This weekly update from the government relations office at the American Association of Community Colleges (AACC) provides the latest on what’s happening in Washington and how AACC is advancing policies to support community colleges and students. Send questions, feedback and more to: kgimborys@aacc.nche.edu.
- Update on FAFSA simplification
- Biden Administration’s debt agenda continues to face legal hurdles
- AACC advocacy resource for the August recess
- New data and reports
- Funding opportunities
Update on FAFSA simplification
Last week, the Office of Federal Student Aid (FSA) at the Department of Education (ED) released a new Dear Colleague Letter (DCL) on the continued implementation of the FAFSA Simplification Act. The law delivers a significant overhaul of the Free Application for Federal Student Aid (FAFSA) and the needs analysis calculation. ED is required to release the new FAFSA form for the 2024-25 award year. The form was originally expected in October, but the release is now delayed to December. While the new changes are expected to increase aid somewhat for community college students and to ease the burdensome FAFSA filing process, the system transition and the FAFSA’s delayed release presents significant challenges for financial aid administrators.
The new guidance outlines the required changes that have already been implemented, including removing eligibility restrictions based on Selective Service registration and drug convictions, and the steps that remain before the end of the calendar year. The DCL explains key changes in the needs calculation, including changes to income components, income allowances, asset components, and household considerations, including the number of students in college per family. The guidance also clarifies changes to Pell Grant award calculations, treatment of a negative Student Aid Index (formerly Expected Family Contribution), changes to auto-zero Student Aid Index (SAI) calculations, and the new direct IRS data-importation process.
This guidance follows the release of the 2024-25 FAFSA preview presentation, which provides financial aid administrators, students and families, and other stakeholders with a walkthrough of the new online FAFSA, complete with screenshots. While FSA has emphasized that the presentation is a draft subject to change and will be released in a more complete form in the months to come, this preview provides a first look at how the new form will streamline users’ experiences and encourage FAFSA completion.
Biden Administration’s debt agenda continues to face legal hurdles
As the Biden Administration continues to pursue broad-based student debt cancellation, citing authority under the Higher Education Act, two of their other debt relief policies are being challenged in the courts.
Last month, ED announced a new borrower-friendly income-driven repayment plan, called Saving on a Valuable Education (SAVE), that would lower monthly loan payments, raise the amount of income sheltered from repayment, lower the timeline to forgiveness for borrowers with original balances of $12,000 or less, and ensure that balances do not grow due to unpaid monthly interest. The new plan would replace the current Revised Pay-As-You-Earn (REPAYE) plan through a phased implementation process, with the process completed by July 1, 2024.
As an early step in this process, ED announced that they would be forgiving $39 billion held by 804,000 borrowers who were enrolled in IDR plans, made 20 or 25 years of monthly payments, but whose qualifying payments were not appropriately counted towards forgiveness. A new lawsuit, filed by the New Civil Liberties Alliance (NCLA), the Cato Institute, and the Mackinac Center for Public Policy in the U.S. District Court for the Eastern District of Michigan, argues that ED overstepped their authority with this one-time debt cancellation measure. The plaintiffs claim that they have standing as non-profit organizations. By cancelling this debt, student loan borrowers will be less likely, they allege, to work for non-profits and qualify for Public Service Loan Forgiveness (PSLF). While ED gears up to defend the new IDR plan, they are also facing legal challenges to the new Borrower Defense to Repayment (BDR) rules that went into effect July 1. BDR regulations create a pathway for students who prove that they were misled or defrauded about their educational program to see their student loans fully discharged. The 5th U.S. Circuit Court of Appeals blocked the new rules from going into effect after a challenge brought by Career Colleges and Schools of Texas (CCST), a for-profit college. The case is expected to be heard by the appeals court on November 6.
AACC advocacy resource for the August recess
Each year, Congress goes into recess for the month of August to allow members to hear from constituents. The August recess is an important opportunity for community college leaders to connect with members of Congress, share the important work you are leading on your campuses, and advocate for continued investment in the community college sector.
To help guide these conversations, AACC has prepared a brief document to inform its members about the most pressing issues to address with their representatives, including FY 2024 appropriations, workforce Pell, the Farm Bill, and the Tax-Free Pell Grant Act.
New data and reports
The National Center for Education Statistics (NCES) released the preliminary data for the 2019-2020 National Postsecondary Student Assistance Survey (NPSAS:20). The NCES website provides summary tables outlining key information on college costs and student aid, and users can build their own tables using the NCES DataLab. Looking for an even easier way to see what the data says for our sector? AACC’s David Baime highlights key stats on student aid, Pell Grant receipt, and student loan borrowing for community college students.
The Congressional Research Service (CRS) has also released a new primer on workforce Pell. The report covers the legislative history of funding for short-term workforce programs, provides summaries of and points of comparison between the bills introduced in the 118th Congress, and explains many of the policy considerations that lawmakers must mitigate on the path to an agreement. It serves as an excellent resource for advocates who want to learn more about this key AACC priority.
Funding opportunities
Applications are open for key community college funding opportunities:
- Postsecondary Student Success Grants – Due September 25
- Advanced Technological Education (ATE) – Due October 5
- Strengthening Community College Training Grants (Forecasted) – Grant application will open early August with an estimated application due date of November 8
For more detailed information on these issues, visit the Community College Advocacy Updates page on our website.
