H.R. 5528, Simplifying the Application for Student Aid Act

H.R. 5528

Simplifying the Application for Student Aid Act

Sponsor
Rep. Joe Heck

Date
July 11, 2016 (114th Congress, 2nd Session)

Staff Contact
Molly Newell

Floor Situation

On Monday, July 11, 2016, the House will consider H.R. 5528, the Simplifying the Application for Student Aid Act, under suspension of the rules. H.R. 5528 was introduced on June 20, 2016, by Rep. Joe Heck (R-NV), and was referred to the Committee on Education and the Workforce, which ordered the bill reported, as amended, by voice vote on June 22, 2016.

Bill Summary

H.R. 5528 would streamline and improve the student aid process by:

  • Requiring the Secretary of Education to allow students to use income data from the tax return filed one year prior to the current Free Application for Federal Student Aid (FAFSA) application cycle (known as prior-prior year).
  • Requiring the Secretary of Education to make FAFSA available on a mobile device and to ensure the online and mobile versions are consumer-tested to promote clarity, and;
  • Requiring the Secretary of Education to allow students to more easily import their Internal Revenue Service income data to automatically populate the FAFSA to increase ease and accuracy of an individual’s application for student aid.

Background

In order to receive federal financial assistance to attend postsecondary institutions, students must submit the FAFSA, the paper form of which runs 10 pages and contains108 questions, which helps financial aid officers determine students’ eligibility for financial aid award packages. The FAFSA has traditionally been available on January 1 for the upcoming award year, but students and families have had to wait until after they file their tax returns to be able to fill out their FAFSA. This delayed the notification of their aid package, and consequently their ability to plan for the cost of their education.

The Higher Education Act authorizes the Secretary of Education to allow students to use income information from two years prior to the date of the FAFSA application, which would help students apply for financial aid earlier because they would already have that information available when the application opens. However, the Department of Education has been slow to implement the use of prior-prior year information, and the application opening this fall for the 2017-2018 academic year is the first time it will be able to be used. This legislation would ensure that using prior-prior year income data is possible for students and families in the future.

Currently, many applicants can import their tax information from the IRS into the FAFSA form, but the traditional application timeline and restrictions around which taxpayers can use the data retrieval tool has meant many applicants could not use this tool. The legislation will allow applicants to more easily import their available income data and automatically populate answers to many FAFSA questions, eliminating many questions students and families struggle to answer and promoting program integrity.

According to the bill’s sponsor, “This bill makes the aid process simpler and easier to understand so that students and their families have the information they need to make an informed decision when choosing a college.”[1]

——————
[1] See Rep. Heck’s Press Release, “Heck Applauds Bipartisan Committee Passage of His Higher Education Bills,” June 22, 2016.

Cost

The Congressional Budget Office (CBO) estimates that implementing the additional administrative requirements in H.R. 5528 would cost $3 million over the 2017-2021 period; such spending would be subject to the availability of appropriated funds. Enacting the bill could increase applications for federal student aid, which would increase discretionary spending for Pell grants and direct spending for student loans and Pell grants; therefore, pay-as-you-go procedures apply. However, CBO estimates that those effects would be insignificant for each year and over the 2017-2026 period. Enacting H.R. 5528 would not affect revenues.

Additional Information

For questions or further information please contact Molly Newell with the House Republican Policy Committee by email or at 2-1374.