Increasing FAFSA Completion: Comparisons of Projects Across SREB States
Journal of Education Practices and Trends, July 2024

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Dr. Rusty Monhollon, Vice President, Academic Affairs, The Kansas Board of Regents Former President and Executive Director, South Carolina Commission on Higher Education
Jessie Lynn Nichols, Ph.D. Student, Auburn University

Louisiana, Alabama, and Texas, all SREB members, have mandatory FAFSA completion requirements. This article compares each state’s approach and results of implementation, shares the potential impact of the new FAFSA form, and makes recommendations for states in the early stages of considering the addition of a FAFSA completion initiative.

In recent years, many states have discussed whether or not high school seniors should be required to complete and submit the Free Application for Federal Student Aid (FAFSA) in order to graduate. The primary purpose for requiring the completion and submission of the FAFSA has been to help students determine their Pell eligibility in hopes of increasing financial aid opportunities and postsecondary degree attainments. Advocates for the graduation requirement report that FAFSA completion is strongly associated with positive outcomes, such as 92% of seniors who complete FAFSA enroll in a postsecondary institution directly after graduation (National College Attainment Network, 2022a) and the earning of a postsecondary degree can be linked to higher incomes, better health, and more civic engagement (Lumina Foundation, 2023). Several members of the Southern Regional Education Board (SREB) along with other states have implemented FAFSA requirements in some capacity, while others continue to seek options to achieve similar goals.

Presently, thirteen states require high school seniors to complete the FAFSA to meet graduation requirements:  Louisiana (first year was Class of 2018); Illinois (first year was Class of 2021); Alabama, Colorado, and Texas (first year was Class of 2022); California, New Hampshire and Connecticut (first year is Class of 2024); Indiana, Nebraska, Oklahoma, and New Jersey (first year is Class of 2025); Kansas (first year is Class of 2028) (Randolph, 2024). Of these states, only four are SREB members with Louisiana, Alabama, and Texas being among the pioneer states to implement the FAFSA completion requirement and Oklahoma on the brink of implementation.

While each state that incorporated the FAFSA into high school graduation requirement has approached the policy’s implementation differently, all of them have seen significant improvements in their FAFSA completion rates. One common denominator for the FAFSA completion states is they all have a data collection system for determining the participation rate of students by high school. They also share completion rates on a website with high school counselors, other district staff and the public so they can effectively assist student applicants in completing and submitting the FAFSA form.

Initiatives and Strategies for Improvement in FAFSA Completion Rates Among SREB States

The SREB FAFSA pioneer states have experienced notable improvements among their student completion rates upon implementation with slight differences in how they implemented the program. All concentrate on helping more students discover untapped financial aid to support them in their academic endeavors to achieve a degree at the postsecondary level.

Louisiana

Louisiana was the first state to pass and implement the mandatory FAFSA completion for all graduating high school seniors in the 2017-2018 school year. Louisiana’s Department of Education (LDOE) recognized that high school students who wanted to attend college needed guidance in completing the FAFSA. To establish a concerted effort, LDOE and Louisiana’s Board of Elementary and Secondary Education (LBESE) gained insight from stakeholders across the state before approving a plan centered around postsecondary preparation for high school students, resulting in the Financial Aid Access Policy, which states:

In order to increase access to state and federal financial aid, their seniors must do one of the following: complete the Taylor Opportunity Program for Students (TOPS) application [state merit-based scholarship] or the FAFSA, declare a hardship through a waiver, or submit a parental opt-out waiver to their local school system. (Florida College Access Network, 2023, para. 5)

Prior to implementing the FAFSA completion policy, Louisiana had a large percentage of high school seniors to complete the FAFSA and ranked 12th among states. The FAFSA completion requirement for all graduating high school seniors propelled Louisiana’s ranking from 12th to 2nd place after the first year of implementation. Figure 1 (National College Attainment Network, 2022b) shows Louisiana’s improved ranking along with significant rank changes to Alabama (34th to 9th), Illinois (10th to 4th), and Texas (23rd to 5th).

Figure 1
States’ FAFSA Completion Rank and % of Seniors Completing a FAFSA
in Year Before and Implementation
Year of Universal FAFSA

Figure 1

Louisiana’s early success was primarily due to the state already having a robust state sponsored student aid program, which required a completed FAFSA as a component of the student’s application. Louisiana FAFSA completion graduation requirement provided exceptions to the graduation requirement with a means of opting out via waiver by parent(s) or school district (Crain, 2021). The state has also had a well-established longitudinal data system so student information could be readily collected and analyzed to make data informed decisions to achieve these types of goals. Another important element to the success of this initiative was the partnership among state agencies, college and universities, and various education advocacy groups who help students navigate their financial aid options.

To promote FAFSA completion, the Louisiana Office of Student Financial Aid (LOSFA) launched a FAFSA website, entitled LOSFA’s Compete to Complete FAFSA Challenge (https://mylosfa.la.gov/schools/field-outreach-services/compete-to-complete/), to display current school rankings in FAFSA completions across the state, showcasing the top 15 districts. The data system provides a count of applications needed to meet the FAFSA completion goal for the state. Louisiana also established a centralized portal, called the LOSFA Student Hub, to streamline the FAFSA application process. Additionally, Louisiana’s financial aid policy incorporated the creation of specific state-funded support groups, such as the Louisiana Counselor Assistance Center and the Financial Aid Working Group, to ensure schools successfully implemented the new financial aid policy.

Alabama

Alabama’s educational leaders also recognized a vast majority of their students were still not completing the FAFSA form and therefore not identifying sources of funding to attend college. In 2021, The Alabama’s State Board of Education (ALSDE) approved the completion and submission of FAFSA as part of the state’s graduation requirements. Similar to Louisiana, Alabama’s FAFSA completion graduation requirement provided exceptions to the graduation requirement (Crain, 2021).

Compared to other state sponsored financial aid programs, Alabama appropriates a smaller percentage of its state higher education appropriation for financial aid than any other SREB state according to the State Higher Education Finance (SHEF) Report as shown in Figure 2 (SHEF Report, 2022). The state and local higher education funding allocated 3.2% for student financial aid in comparison to the United States’ average of 10.8%. Thus, the decision to add the graduation requirement significantly improved student access to financial aid for college, especially for low-income students.

Figure 2
Percentage of State and Local Higher Education Funding Used
for Student Financial Aid by State, FY 2022

Figure 2

After the first year of implementation, Alabama’s FASFA completion graduation requirement yielded a dramatic improvement in the number of FAFSA completions from the prior year, moving its rank among states from 34th to 9th in 2022 (see Figure 1). Alabama also showed (see Figure 3) significant improvement from the prior year in all types of schools and communities, ranking 1st in improvement in FAFSA completion at low income, high income, high minority, low minority, suburb, town and rural schools as well as ranking 2nd in improvement in city schools.

Figure 3
Percentage Change in FAFSA Completion Year-Over-Year
by Selected Characteristics through 5/27/22 in AL

Figure 3

Alabama’s approach to the FAFSA implementation was more technical in nature and coordinated at the state level. The Alabama Commission on Higher Education (ACHE) partnered with Oracle to develop a robust data collection and analysis feature that could provide high school staff with information not only on student participation but also with student errors on the application so students can complete the process more efficiently. ALSDE provides training on the FAFSA to Career Coaches serving the state’s high schools. Schools and districts are provided with a list of their seniors who have applied, completed, or have incomplete FAFSA, including the errors per student of those with an incomplete FAFSA.

In addition, high school seniors receive a correspondence to offer guidance on their FAFSA application errors as well as inform them of other state aid opportunities administered by ACHE and other state agencies, local communities, and Alabama Possible, a statewide nonprofit that serves as a portal to many privately-funded scholarship opportunities. The direct correspondence with students had a significant impact on student participation from its onset in February of 2022 as shown in Figure 4.

Figure 4
Alabama FAFSA Completion of Four-Year Trend

Figure 4

ACHE also created an online dashboard, FAFSA Completion (https://fafsa.ache.edu/Data/Summary), that permits district officials to compare their FAFSA completion rates to other schools within a district or statewide. The comparative data can also enable civic and political leaders to monitor district and school performance.

According to the National College Attainment Network (NCAN) (2023), Alabama had reduced the state’s unclaimed Pell dollars by $1.3 million for every percentage increase in FAFSA completion. Alabama students also claimed an estimated $11.8 million in 2022 and $14.4 million in 2023 in unclaimed Pell due to the improved FAFSA completion rates (see Figure 5).

Figure 5
Alabama’s Estimated Unclaimed Pell Dollars
and Students Completing FAFSA

Figure 5

Hence, Alabama’s annual commitment of $500,000 has yielded an average increase of $13,100,000 in federal student aid. In seeking higher rates of FAFSA completion libraries are now getting involved to promote the FAFSA and provide internet and computer use in support of filling out the FAFSA form.

Texas

Similar success was found in the implementation of a FAFSA completion and submission requirement for high school graduation in Texas. Along with the new graduation requirement, Texas added a performance-based funding policy to provide financial incentives for school to increase their FAFSA completions (Granville, 2020). As a result, Texas’ percentage of seniors completing the FAFSA in the first year of the graduation requirement improved from 50% to 62%, shifting their rank among states from 23rd to 5th (see Figure 1).

Texas Education Agency (TEA) offered several training and reference programs to allow students, parents, and educators to learn more about financial aid and its resources within the state of Texas. However, one unique aspect of TEA’s strategy for the graduation requirement was to establish an in-depth data sharing process among key state entities to provide educational leaders with fundamental information. The TEA (2021) has referred to this process as the Texas (Student) Records Exchange System.

TEA and the Texas (Student) Records Exchange System work hand-in-hand with all Texas public school districts, open enrollment charter schools, public colleges, and universities to report student data, including FAFSA completions, electronically via the TREx system per the following description:

An automated student record exchange system enables districts to communicate with each other more effectively about students who are withdrawing or enrolling. Improved communication should improve the reliability of dropout rate calculations. Additionally, the automated system facilitates the rapid and appropriate academic placement of students enrolled in a new district and ensures continuity of services provided to students who move between Texas school districts. (TEA, 2021, p. 9)

As part of the data exchange, specialty codes denote whether a student has completed the FAFSA, met the graduation requirement, and met the deadline with the month and year the student completed the application. In addition, translation codes are included to signify whether the financial aid application form has been completed or an exception has been submitted. The system (TEA, 2022) also mandated all high schools provide certain student information, such as student ID, campus name and phone number, name, gender, ethnicity, and birthdate of the student, current student grade level, and immunization records. This data collection has been used to provide a statewide dashboard, FAFSA Completion Over Time (https://www.edtx.org/txcan/resources/fafsa-completion-by-state), for comparisons to be made among regions, counties, districts, and campuses.

While Louisiana, Alabama, and Texas have different activities to support their FAFSA completion graduation requirements, all of these SREB states provide students, parents, and educators with resources, materials, financial aid tools, and additional programs to assist their graduating seniors. It is evident that each state has mechanisms in place to continually foster supportive measures for higher education policies and procedures. By engaging with their stakeholders and collaborating with their education entities, these states have positively impacted their students’ financial aid needs to secure a promising future for their workforce.

The Implementation of the New Universal FAFSA

The FAFSA Simplification Act significantly changes the FAFSA application process. The application has been reduced to 36 questions with the majority of the information being retrieved from the applicant’s tax records (Federal Student Aid, 2023). The transfer of tax information within the application is also supposed to be more seamless for the applicant. However, each person who submits information is considered a contributor and will need to apply for an individual FSA ID to complete the application.

One challenging modification is the new rule pertaining to students of divorced parents, which requires the higher income-earning parent to share tax information even though he/she may not be the primary caretaker. Another factor that may affect a student’s financial aid is the removal of the sibling discount as parents will no longer receive credit for having multiple children enrolled in college. One final potentially influential change is the new Student Aid Index (SAI) calculation, a formula used to determine a student’s ability to pay, which will replace the Expected Family Contribution (EFC). While this computation is seemingly straight forward, the change may pose problems for students from rural family farm operations, small family businesses, and more as this new calculation considers wealth and not income. Wealth requires the reporting of assets such as farmland and business values.

The U.S. Department of Education (2023) anticipates Pell Grant eligibility will be expanded to more students with an estimated 610,000 new students of low-income families being eligible for a Federal Pell Grant in the 2024-2025 award year. The Department also projects an additional 1.5 million students will receive the maximum Pell Grant award. Reaching these estimations will be record-breaking numbers for the accessibility of financial aid to students.

With respect to FAFSA completion, the Florida College Access Network (FCAN) (2022) indicated that a high school senior who completes the FAFSA is more likely to enroll in a postsecondary institution and complete a degree, which is supported by national data declaring “90% of students who complete the FAFSA enroll in college directly from high school, compared to just 55% of non-completers” (p. 1). FCAN also acknowledged NCAN as stating “with every $1,000 in aid a student receives, persistence increases by four percentage points” (2022, p.1). Thus, early intervention of FAFSA completion is pivotal to the success of students having access to financial aid opportunities to start and finish their college careers. More information about the new FAFSA form can be found at the official Federal Student Aid website (https://studentaid.gov/h/apply-for-aid/fafsa).

Recommendations

Several benefits of requiring a completed FASFA as a part of high school graduation have emerged. All of the SREB states that implemented such a requirement yielded significant increases in financial aid for students. Other outcomes reported are 1) the promotion of college readiness by encouraging high school students to think more intently about their postsecondary plans amid more financial options, 2) the alignment with state educational goals of increasing college enrollment and improving educational attainment levels, and 3) the production of more skilled workers with the necessary credentials to strengthen the state’s workforce on a long-term basis.

It is inevitable that a new state initiative will come with its own unique challenges, including the introduction of a FAFSA completion graduation requirement. Amid some of their own challenges, Louisiana, Alabama, and Texas included a waiver option at the parental or local school/district level but handled the submission process differently. Hesitation among students and their families toward completing the FAFSA were as follow:

  • Complexity of the FAFSA form that can overwhelm the student or parent,
  • Concerns over privacy and confidentiality of information shared on the FAFSA form,
  • Reluctance of disclosing financial details when not fully understanding how the information may be used to determine eligibility,
  • Misconceptions about financial aid eligibility and assuming qualification is impossible,
  • Worry of loans being offered and accepted, leading to a large sum of debt,
  • Limited communications in navigating the FAFSA process, especially among families in which English is a second language, and
  • Simple lack of awareness to the importance of completing the FAFSA.

Fortunately, these SREB states, along with the ten other FAFSA completion requirement states, have found a way to make the mandate work well within their states for the good of their students.

References

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