The Road to Reauthorization

How to Analyze Higher Education Reforms

What is the Higher Education Act and why should you care about reauthorization and policy changes? Originally passed by Congress and signed into law by President Lyndon B. Johnson in 1965, it governs almost all aspects of how colleges and universities operate in the U.S. As with most legislation, it includes sunset provisions. These policy changes expire unless extended / “reauthorized” by Congress and signed by the President.

HEA History

Some Higher Education Act reauthorizations impact society in major ways. For instance, the 1972 reauthorization includes landmark Title IX provisions for gender equality in sports. Today’s sports calendars on college campuses include tons of inter-scholastic women’s events. In previous years, women’s sports were non existent or relegated to the intramural gym.

Major provisions became law in December 2020 with the  Consolidated Appropriations Act, 2021.  According to the National Association of Financial Administrators, it includes “a number of significant higher education provisions including FAFSA simplification, changes to Federal Methodology, the expansion of Pell Grant eligibility to incarcerated students, and the repeal of the limitation on lifetime subsidized loan eligibility, known as Subsidized Usage Limit Applies (SULA).”

Incarcerated students qualify for Pell Grants as long as they are registered in an approved in prison education program and meet the other requirements for Pell Grant eligibility. Another important change is that drug convictions no longer eliminates financial aid eligibility. Young men under 26 aren’t required to register for the selective service, potential military draft, either.   

FAFSA Simplification

Over the past few years, a few changes simplified financial aid applications. One of the biggest ones is the ability to pull income data directly from the IRS with a few clicks. Simplifying the formula for Pell Grant eligibility is pretty cool, too. Under the new rules, an income table where students could tell whether or not they may qualify before filling out the FAFSA form is a possibility. What isn’t as cool are new rules hurting divorced families and families with multiple children in college.

We wrote an article to explain the FAFSA changes for large families. The quick version is beginning with the 23 / 24 academic year, the parent contributing the most financial support instead of the parent they live with will determine financial aid eligibility and amounts in divorced families.  Many large families could see a significant drop in aid received because the amount families are expected to contribute will no longer be split among multiple children. The exception is if families have a zero to low expected contribution amount.

The form is quicker to fill out but at what cost? 

Bottom Line: Stay Informed, Stay Tuned, and Be a Smart Consumer 

Over time, rules change. For instance, Public Service Loan Forgiveness was introduced in 2007. The first round of forgiveness happened in 2017. Over time, applications were introduced, simplifying figuring out qualifications. Now, notifications are being sent out. Especially, in the early days, only the people that followed and paid attention to the news and followed instructions exactly earned forgiveness. Too many people got to their 10 year point and didn’t meet qualifications they could have. 

Just this past year, the government offered 0 % interest and no payments due during the pandemic IF you didn’t have older federal loans under the FFEL program.  FFEL participants that didn’t pay attention missed payments, possibly enough to default. We’re paying attention to rule changes for you. However, they could have if they asked for a forbearance or consolidated to direct Loans. Don’t fall through a loophole. 

As your advocate, read our articles and be a smart consumer when comparing both school offers and financing offers. Use our tool to find private loans at your school and compare rates.