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The Department of Education’s Disastrous FAFSA Rollout

The Department of Education has been attempting a new rollout of FAFSA (Free Application for Federal Student Aid) in recent years after the FAFSA Simplification Act passed in December 2020. The new form was presented to the public in December of 2023, which contained technical errors that prevented families from being able to complete applications. The DOE worked to address the technical issues and a backlog of applicants who needed their applications processed formed. Colleges were prevented from providing aid estimates without the data from the DOE. This failure to substantiate a functional new system has led to calls for investigations into the Department’s process of setting up the new FAFSA. 

The DOE started providing data for the student FAFSA on March 10. Education Secretary Miguel Cardona has recently stated some schools are still not fully prepared to receive this data, as infrastructure such as new “SAIG (Student Aid Internet Gateway) mailboxes” need to be set up by institutions to receive it.

The extreme delay of a functional rollout puts pressure on schools to provide timely aid package estimates to students. Where usually, schools have months for these estimates, now will be done within weeks for millions of applicants across the country. To make matters worse, roughly 200,000 estimates provided by the Department of Education to schools were miscalculated. The error affected applicants who accounted for their assets and did not factor in financial savings, which made the calculations faulty. 

After discovering the error, the Department of Education advised schools to use updated methodology from the department to calculate the aid packages of students affected manually. The DOE has stated it will have to recalculate these packages to verify the amounts but didn’t disclose when it believes it will be able to. This direction from the Department of Education highlights how much it overestimates the resources of collegiate financial departments. These departments can't quickly make these kinds of financial aid estimates manually, which greatly impacts the rate at which these schools can turn around package estimates for the rest of their applicants. 

College students relying on financial aid estimates to inform their decisions on where to attend are uncertain about their next steps. This may result in prospective students not attending their first college semester, which could affect their returns to college. Some schools are offering merit scholarship students more money in aid to keep them in their freshman classes. Students expect to get their aid figures in mid-April, leaving about two weeks for students to decide where they will be going. Some schools still adhere to the May 1 application deadline, while as many as 190 colleges have already pushed back deadlines by two weeks to an additional month.


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