A little over a year ago, our enrollment team at Augustana College met in retreat to discuss the anticipated impact of prior-prior year submission of the Free Application for Federal Student Aid, or early FAFSA, as it is called now. We completed a strengths, weaknesses, opportunities and threats analysis of what we perceived as entwined in this big change to the financial aid and recruitment timetable. After considerable discussion, we created new timetables, developed a new communication sequence for our prospective and current students, established new and updated old systems, and took a deep breath as we faced an uncertain future with new time frames and a new process.
As we spoke with visiting families during the spring and summer months, we were pleasantly surprised by how many seemed to be informed and fully aware that the FAFSA would now be available for submission on Oct. 1, rather than Jan. 1 -- and that applicants will be able to use income information from two-year-old completed tax returns rather than sometimes incomplete information from the previous year. The high level of awareness continued into the fall. All visit days and high school visits confirmed that families, school counselors and other influencers were aware, had adjusted timetables and were itching to submit the FAFSA earlier than ever before.
Oct. 1 came quickly, and so did the FAFSA submissions. It seemed as if many families were sitting at the computer ready to submit the infamous form in the same way many of us waited to order tickets for Broadway’s Hamilton, refreshing their browsers until they could get in and get it done.
In fact, the early volume of FAFSAs submitted from prospective and current students stunned Augustana’s office of financial aid. All the table tents in the dining hall, the umpteen emails we sent out, our first-ever FAFSA print mailer and the inclusion of the FAFSA timeline in our application instructions had worked. We are rolling in FAFSAs and have exceeded last year’s total volume from first-year students by 40 percent.
Given the high conversion/yield rate for FAFSA submitters in the past cycle, it’s time to break out the champagne. I mean, we’ve done it. We reconditioned the marketplace, prospective students and their families are following our directions, and now we just need to execute. Right?
I confess that I’ve enthusiastically shared the volume numbers with faculty and staff members, the president, and the chair of the Augustana Board of Trustees, and I even tweeted about it early on. But I also admit that I don’t know whether our numbers are strong or soft indicators. Perhaps, I suspect, they are a little of both.
And as I dig into the data, I am increasingly convinced that these lead indicators require very cautious interpretation and should temper my exuberance. Let me offer a couple of examples.
First, because of the U.S. Department of Education’s caution about establishing early timetables for submission, and the potential impact on underserved populations, I have been watching FAFSA submissions for applicants of color carefully and am cautious about what I see. Currently, we continue to see trailing rates of submission for students of color in the applicant pool, with more than 40 percent of those students who applied for admissions not yet filing the FAFSA. The department’s caution is relevant to all of us, and we must now ask what we can do to increase the filer rate among this important population.
Second, nearly 20 percent of those students who have submitted the FAFSA have not yet applied to my college for admission. Some of these FAFSA submitters are even coded as having asked us to cease communication with them. Now, a universal truth in college admissions is that 100 percent of the students who don’t apply don’t enroll. While there certainly is plenty of time for these hundreds of FAFSA submitters to still apply (and I sure hope they do), it’s also reasonable to conclude that we are not a serious consideration for them, making this usually strong indicator meaningless.
There is more to investigate as we look at these very early indicators, but only time will tell us what all of this means.
Looking at the data, I wonder if the Department of Education and all of those who pushed for early FAFSA may have just created the newest fast-application program. Fast-application programs for college admissions are frequently criticized for inflating applicant pools and making it too simple and too convenient for students to apply. These same programs make it difficult for new users in college admissions to interpret what an increase in volume may really mean to yield and enrollments.
Think about it. We’ve made it easier to submit the FAFSA. We’ve aggressively communicated about submitting the FAFSA. We’ve created a marketed FAFSA with the IRS data-retrieval tool. We have systemwide partners, like the Common Application, more effectively encouraging the submission of the FAFSA. We’ve done our best to better align the cost and admissions decision.
It seems we are doing all of the right things. But are we reaching all the right students and families --those most likely to choose Augustana and thrive here?
I am a believer in making the entire process more transparent and less complicated, and in aligning the cost and search process. But I wonder if early FAFSA will just add a new complication for colleges and families -- and more noise that must be interpreted and filtered. Only time will tell.
W. Kent Barnds is executive vice president at Augustana College.
As the author of Why Public Higher Education Should Be Free, I should be excited by the new plan to make public higher education tuition-free for certain students in New York State. However, the history of American financial aid for college reveals that we need to be very wary of the details of even well-intended policies. In fact, over the last 40 years, the United States has spent trillions of dollars on financial aid to make college more affordable and accessible, and yet the opposite has happened.
In looking at the New York plan, we can see why it will not accomplish its desired goals. The first problem is that it only deals with tuition and not the total cost of attendance. For instance, at the State University of New York, the tuition for this year is $6,470, but the total cost is $24,630 for New York resident students not living at home. And in the case of the City University of New York, tuition is $6,630, but the total cost of attendance is $26,036.
In other words, tuition accounts for only about a quarter of the real cost of going to a public college or university in New York, and so the biggest cause for student debt or nonattendance is not tuition but related costs -- like housing, textbooks, transportation and food. Moreover, most federal and state aid programs only deal with tuition, and so for many low-income students, the plan will be of little or no help.
Another major problem with this plan so far is that it does not appear to try to contain increases in the cost of tuition or related college expenses. Just as in the case health care, if you subsidize something but do not control its costs, it will not be able to achieve its policy goals. U.S. Senator Bernie Sanders should know this, because he introduced a bill into the Senate last year that would have regulated tuition increases and would have also forced colleges and universities to spend more on instruction instead of administration.
Sanders’s bill also required colleges and universities to increase their use of full-time faculty members in order to enhance the quality of education. But New York’s plan does not delve into these issues.
The plan also does not deal with huge federal and state tax breaks related to higher education that often go to the wealthiest families. In fact, New York State already spends over $240 million a year on tax credits and deductions for tuition, and more money is sheltered from taxes through the use of 529 College Savings Plans.
It is understandable that Governor Andrew Cuomo wants his state to come up with its own plan, because he can’t expect much help from the new U.S. Congress or president-elect. But it is important to realize that since we have federal, state and institutional forms of aid, we need programs that integrate those different funders.
If Governor Cuomo wants to know what a successful funding plan for higher education should look like, he can examine CUNY’s own successful Accelerated Study in Associate Programs, which funded wraparound services for low-income community college students. One of the great benefits of that program was that, with little additional cost, it was able to improve the graduate rates of low-income students. The program also showed that if you are serious about improving the quality, affordability and accessibility of higher education in America, then you cannot simply focus on free tuition. For example, research on the success of ASAP showed that sometimes the key way to help a student to graduate on time is to give that student financial support for transportation.
It is great that the state of New York wants to do something progressive for higher education, but the devil is in the details. And the history of American college financial aid has shown that well-intentioned programs often backfire if they do not examine unintended consequences. We should promote free public higher education, but only if we do it right.
Robert Samuels is president of UC-AFT and teaches writing at the University of California, Santa Barbara.
The benefits of higher education are well established: a significant boost in average earnings, a higher likelihood of employment, increased productivity, greater tax revenues, lower crime. But much debate continues on how best to encourage more students to make high-quality educational investments and how to ensure that a degree is affordable. As the Obama administration welcomes its final back-to-school season, the opportunity arises to look back and assess the impact of its higher education policies and next steps to build on that progress.
A new Council of Economic Advisers report released yesterday examines the administration’s record, finding that evidence-based policies implemented over the last seven years have already begun to pay off. Investments in greater financial aid, in particular, have had high returns. The Council of Economic Advisers estimates that the administration’s increase in the average Pell Grant award between 2008-09 and 2014-15 will lead to an additional $20 billion in aggregate earnings, a nearly two-to-one return on the investment.
But that is only one example. Without federal support, much of the potential benefit of higher education would go unrealized due to misalignments between individual and societal benefits, credit constraints, information failures, and procedural complexities. Since taking office, the Obama administration has worked to address each of these areas so that more students can attend a quality higher education institution, graduate and repay their loans on manageable terms.
From the very beginning of the college selection process, students can face obstacles; even determining which colleges will provide a good return on investment is a daunting challenge. That is why the administration unveiled a redesigned College Scorecard offering the most reliable and comprehensive data ever published on students’ outcomes at individual institutions, including data on cost, graduation rates, earnings, debt and repayment.
At the same time, even with solid information, procedural complexities may prevent some students from using the resources available to them. To help make it easier for them to apply for student aid, the administration has made the Free Application for Federal Student Aid simpler by reducing the number of questions it presents and making it easier for applicants to directly transfer data from the IRS. In addition, the FAFSA is available earlier this fall, improving the information students have about their financial aid packages when they make decisions about where to apply.
Once accepted, students must also determine how to pay for their education. Research shows that lower college costs can improve college access and success, and the administration has made it a priority since day one to help families finance investments in education. President Obama has worked aggressively to increase the maximum Pell Grant award by $1,000, and, for the first time, tied the maximum amount of the award to inflation. This investment will help an additional 250,000 students access or complete college. On average, Pell Grants reduce the cost of college by $3,700 for eight million students a year. In addition, this administration has also established the American Opportunity Tax Credit, which will cut taxes by over $1,800, on average, for nearly 10 million families in 2016, thus giving students and their families more discretionary income to invest in college.
Despite these successful investments, too many people still feel as if college is out of reach. That’s why President Obama announced his America’s College Promise proposal in January 2015 to create a new partnership with the states that would make two years of community college free for hardworking, responsible students. Since the president’s announcement, over 36 free community college initiatives have been launched in states, cities and communities nationwide. Altogether, these programs raise more than $150 million in new public and private investments, supporting at least 180,000 students.
President Obama has also signed key policies into law to maintain the accessibility and affordability of student loans. Research suggests that without access to federal student loans, financially constrained students would be less likely to attend college, more likely to work while in school, and less likely to complete a degree. In 2010, President Obama signed student loan reform into law, generating over $60 billion in savings and redirecting that money back to students and taxpayers. And in 2013, he signed into law further reforms to lower interest rates for nearly 11 million borrowers.
Additionally, the president’s Pay As You Earn and related income-driven repayment plans have allowed approximately 5.5 million student borrowers to cap their monthly student loan payments at rates as low as 10 percent of discretionary income, to ensure their debt is manageable. These plans better align the timing of loan payments with the timing of earnings benefits by allowing borrowers to make smaller payments when their earnings are low or during transitory periods of financial hardship and to adjust their payments as their earnings grow.
Finally, this administration has worked to protect students from unscrupulous institutions that do not deliver a quality education. The U.S. Department of Education’s gainful employment rules will hold career colleges accountable by removing poorly performing programs’ access to federal financial aid. Such rules build on a record of action by this administration to increase accountability in higher education. The department has also created a Student Aid Enforcement Unit to respond more quickly and efficiently to allegations of illegal actions by higher education institutions.
Though more work remains, these policies taken together represent a significant step forward in building an educational system that encourages all Americans who wish to invest in an affordable, high-quality college education to do so. Colleges and others in the higher education community can build on that progress by encouraging students to fill out the new early FAFSA so that they can learn about and access the student aid dollars that are so critical to their future.
Sandra Black is a member of the Council of Economic Advisers. Jason Furman is chairman of the Council of Economic Advisers.