FAFSA Simplification Efforts Begin This Summer

After months of work by the Department of Education, Secretary Arne Duncan announced on June 24, a series of steps to simplify the application process for federal student aid. The action is part of President Obama's education goal "to once again have the highest percentage of college graduates in the world."

At a White House press corps briefing, Duncan explained that the department is already providing instant Pell Grant and loan eligibility estimates to aid applicants. This kind of information, which in the past arrived weeks after a student applied, is seen as essential in assuring low-income students that they can afford to attend college.

As early as this summer, some students using the new Web-based FAFSA will be able to ignore many of the 153 questions on the form through improved skip-logic. This enables applicants to ignore questions that are irrelevant to them. For example, students who are at least 24 year old, or who are married, will not have to be answer questions about their parents' income and assets.

Duncan said that "Starting in January 2010, students applying for financial aid for the spring semester will be able to seamlessly retrieve their relevant tax information from the Internal Revenue Service" when applying for aid on-line. This means that students from low-income families will not be asked about assets. The department and the IRS are working to expand the IRS option to all students in the future.

The administration also intends to propose legislation that would allow the department to eliminate from the FAFSA any information not available from the IRS. This would permit removal of 26 financial questions from the form that, the department claims, have little impact on award amounts and are difficult for applicants to answer.

The department completed a study late last year comparing eligibility under the current need analysis formula and one taking into account only a family's adjusted gross income and its size. Their conclusion was that the information from the much abbreviated form was acceptably similar to that from the longer form.

However, eligibility adjustments that are minor in the national aggregate, could make a large difference to certain students, colleges, or sectors of higher education. Also, if the FAFSA is made too simple, states and colleges might no longer use the form in awarding their own aid, leading to kinds of multiple aid forms and high application fees that were common before the FAFSA was created in 1992.

NAICU is actively engaged in the conversation to ensure that simplification truly helps students.

Private College Tuition Rises at Lowest Rate in 37 Years!

With families facing one of the worst economic crises in the nation’s history, private, nonprofit colleges and universities have responded with the smallest average increase in tuition and fees in 37 years, according to the final results of a recent survey of our members.

The 4.3 percent increase for 2009-10 is the smallest since 1972-73, when average tuition and fees at private institutions rose by the same rate. The increase is slightly higher than the 2008 Consumer Price Index of 3.8 percent. The figure is based on responses from 350 private, nonprofit colleges and universities.

The average increase in institutional student aid budgets for 2009-10 at these colleges is 9 percent. (This is the first year that we collected student aid figures from its member institutions as part of the annual tuition survey.) Over the past 10 years, the average annual increase in tuition and fees at private colleges has been 6 percent.

“To an unprecedented degree, students and families are concerned about affording the college of their choice,” said NAICU President David L. Warren. “Private colleges are committed to maintaining access for students from all backgrounds—especially in tough times.

“Private college and university budgets have been hit by dropping endowments, a reduction in charitable giving, and growing student financial need,” Warren said. “Nevertheless, they have made extraordinary efforts to keep students’ out-of-pocket costs as low as possible while protecting academic quality.

See our press release on the survey here.

New GI Bill Extends Significant New Benefits to Veterans

We're nearing the final implementation date for the Post 9/11 GI Bill, the new program that greatly expands the education benefits available to veterans. Benefits become available to veterans on August 1, 2009.

The basics of the program are these: veterans that meet certain qualifications (see this roundup of qualifications from the VA) are eligible to receive an amount equivalent to the highest state institution's tuition and fees for each state. Click here for a chart that lists the amounts for each state.

This amount can be applied to a veteran's education at any institution, public or private.

In some cases, the amount charged at an institution is higher than the basic benefit, so the Post 9/11 Bill provides for the Yellow Ribbon Program, wherein a participating institution splits the extra amount on a 1-to-1 basis with the VA. more than 740 private non-profit institutions, as well as many public and for-profit institutions, signed up to participate by the June 15 deadline.
Click here for a list of participating institutions from the VA (the VA should publish a final list by June 30, 2009), and click here for a video explaining how yellow ribbon benefits are calculated.

NAICU has a number of resources available on the GI Bill at our special dedicated website. We've also compiled recent news articles of interest.