Washington, DC- Today, U.S. Senator Bob Casey (D-PA) announced that following a letter written by a bipartisan group of 53 members of Congress to U.S. Department of Education Secretary Arne Duncan, the Obama Administration has announced that beginning with the 2016-2017 FAFSA, students will be able to submit data from the previous tax year (prior-prior year) for the purposes of calculating their student aid eligibility. This means that students will be able to use 2015 tax return information, rather than 2016 tax return information, to establish eligibility for the 2017-2018 academic year.
“Earlier and more accurate financial aid award information will allow students and families, and especially low-income and first generation students, to make better-informed decisions about their educational careers,” Senator Casey said. “I applaud President Obama and the Department of Education in taking the necessary steps to improve the FAFSA application process and help reduce the burden for students and institutions.”
The full text of the letter can be seen below.
Dear Secretary Duncan:
We write to request that the U.S. Department of Education use its authority to improve the financial aid process, empower consumers, and increase college access by allowing students to fill out the Free Application for Federal Student Aid (FAFSA) earlier.
Right now, many students across the country are receiving their college admissions letters without the accompanying financial aid award information they need to compare college options and costs. Earlier and more accurate financial aid award information would allow students and families, and especially low-income and first generation students, to make better-informed decisions about their educational careers. Unfortunately, the current limitation on the tax data students and families can use on the FAFSA has created a highly disjointed process and timeline. The complexity of the financial aid application process also undermines educational aspirations, enrollment, and persistence. Resolving this situation will be an important priority for our work to reauthorize the Higher Education Act. However, we do not need to wait to provide students and families much-needed relief. The Department can and should improve the process of filling out the FAFSA right now.
The Department should use its authority under Section 480(a) of the Higher Education Act to allow the use of data from the second preceding tax year, also known as “prior-prior year” data. Most families’ incomes do not change significantly from year-to-year, yet the current process forces applicants to wait until January 1 of each year—far after many college application deadlines—to complete the FAFSA in the same year they plan to enroll using the prior year’s tax data. When the FAFSA becomes available, many students and their families struggle to obtain tax documents quickly enough for dozens of local, state and private grant deadlines. The short window provided for filing taxes before filling out the FAFSA places students and families in a difficult situation with few good options.
Under your authority, the Department can allow students to use prior-prior year data, which is more likely to be on file and much easier to import directly into the FAFSA. This will speed up the application process and help reduce the burden of verification for documenting their financial situation and aid eligibility. Prior-prior year data is also not likely to have a significant effect on students’ financial aid awards. Financial aid administrators, admissions officers, state grant agencies, and college access programs also strongly support using this data.
Finally, using prior-prior year data would help alleviate the burden on colleges and universities. Institutions of higher education are required to verify FAFSA information to ensure that scarce student aid funds are flowing to the right students. The recent Task Force on Federal Regulation of Higher Education identified verification as a significant drain on financial aid offices and the source of the biggest burden associated with regulatory compliance. In contrast, verification of elements already contained on filed tax returns is relatively easy for aid administrators to document and process. Prior-prior year data is often already on file, so shifting to this data would allow students and their families, the federal government, and institutions of higher education to use more accurate information and simplify the verification process to ensure taxpayer dollars are appropriately spent.
Given the enormous benefits to students, families, and institutions of higher education, we strongly urge you to use your authority to allow the use of prior-prior year data on the FAFSA. This is an opportunity for swift and consequential action to support low- and- middle-income students seeking a shot at the American dream through higher education, and would allow the federal government to simplify the process that millions of students and families experience when applying for aid. It will also support informed decision-making about college options, and help students receive the financial aid they need to complete a degree or credential. The current process that students and families must navigate when filling out the FAFSA is significantly disjointed, and we urge you to help fix it for them.
Thank you for your attention to this matter.