New FAFSA timeline could result in major changes in admissions

While applicant attention has been largely focused on such headline-grabbing college admissions issues as new tests, new score reports, new applications and the proliferation of portfolio development tools, the Department of Education has been quietly working on changes in the Free Application for Federal Student Aid (FAFSA) due to be implemented just after school starts next fall.

In a nutshell, FAFAS is backing up the timeline for filing federal aid applications by three months to support a new policy enabling students to use “prior-prior” year (PPY) tax data to qualify for aid. In other words, a high school senior planning to enroll in college in fall 2017 will file FAFSA using tax information from 2015—the prior prior year.

PPY is scheduled to debut in October 2016, for applications for the 2017-18 award year.  This means that the high school class of 2017 will be the first group to use the PPY FAFSA. It also means that colleges, along with the Department of Education and the Internal Revenue Service, are scrambling to figure out what impact this change will have on basic application mechanics as well as on the overall admission cycle.

Make no mistake. The use of PPY is a welcome new policy supported by all the major financial aid players including AACRAO, NACAC, NASFAA, NASSGAP, and the College Board, which is realigning CSS PROFILE requirements to use PPY. In addition, a number of colleges have already announced commitments to make similar changes in institutional financial aid applications for the 2017-18 year, including the University of California system and others.

According to the National Association of Student Financial Aid Administrators (NASFAA), the move to PPY will mean students and families will be able to file FAFSA earlier, make consistent use of the IRS Data Retrieval Tool (DRT) for populating the application with accurate tax return data, and receive earlier notification of financial aid packages.  

The theory is that if students apply for aid earlier and are more accurate in the information they submit, colleges can provide earlier financial aid notifications thereby ensuring that students and families have more time to prepare for college costs and make better application decisions.

But that’s where theory and practice have yet to come together.

In an insightful article prepared for NACAC’s Journal of College Admission, Eileen O’Leary, assistant vice president of student financial assistance at Stonehill College suggests a series of technical challenges potentially associated with the implementation of PPY:

• Institutional financial aid deadlines may be moved up from sometime after January 1 to any time after October 1 for both Regular Decision and Early Action applicants. 
• Admission application deadlines may need to be set earlier to more closely align with earlier FAFSA filing dates, requiring high school counseling offices and applicants to submit documents even closer to the start of the school year.
• The admissions recruitment cycle may need to be moved entirely into junior year of high school.
• Colleges may want to require enrollment commitments before the current May 1 commitment deadline.
• With more potential for income and family changes over the course of two years instead of just one, the use of PPY or older tax data may increase the number of families asking for professional judgments or reconsideration of their awards.
• Students may apply to fewer schools as a result of being more aware of affordability issues, which will affect a number of admissions metrics important to college administrators including yield and selectivity.
• The availability of earlier information relative to the financial status of applicants could tempt more colleges to become need-sensitive when deciding which students to recruit and admit.

In other words, it’s quite possible that the shift in FAFSA timelines could result in parallel shifts in the entire college admissions process, as financial aid offices begin coping with requests for aid before admissions applications are required to be submitted. 

And with less than eight months to go before the October 1 launch, it’s reasonable to ask if colleges and high schools are planning for what could be a series of unintended consequences resulting from the PPY plan.

For example, will high schools be able respond by scheduling financial aid nights earlier in the school year? Will they be able to continue supporting students in need of assistance to access and complete these documents while coping with issues typical of the start of the school year?  Will students and high school counseling offices be prepared to submit admissions documents earlier to accommodate earlier deadlines? Are admissions offices prepared to begin recruiting students and reading applications earlier?  Will the use of PPY increase the pressure and stress already associated with the college admissions process?

Colleges asked about how PPY will affect admissions mostly dodge the question so far. For now, they are dealing with basic software and enrollment management complications as well as issues related to how staff will deal with the earlier arrival of financial aid documents. 

“I anticipate we will see a mix of reactions in the initial year or two, ranging from colleges that aggressively change their admission and financial aid timelines to take competitive advantage of PPY, to those who make no changes to current practices, waiting for others to test the new waters,” said Ms. O’Leary. “It is time for all of us—guidance, admission, and financial aid professionals—to begin the conversations and make preparations for the arrival and requirements of this next big sensation.”