The Biden administration is suspending some federal financial aid audits of students and colleges as they contend with Education Department processing delays that are upending the typical college admissions cycle this spring.
The changes, which Education Department officials rolled out Tuesday, are among a series of steps the agency is taking to help students and colleges respond to the troubled rollout of the new Free Application for Federal Student Aid.
“Fewer requirements for colleges and universities this spring means more time and resources freed up to deliver financial aid for students and make the most of the ‘Better FAFSA,’” Education Secretary Miguel Cardona told reporters Monday. He said the changes were a direct response to requests from college and university leaders.
Officials said they were working to “significantly” reduce the burden of audits on students and families who apply for federal financial aid.
In a typical year, the Education Department selects as many as a third of applicants for additional scrutiny through a process known as “verification.” Those audits — which were similarly scaled back for several years during the Covid-19 pandemic — often require students to produce additional documentation, such as a tax return or proof of their identity.
Fewer students were already going to be selected for the additional scrutiny through the new FAFSA process. That’s because most applicants will have their income information transferred directly from the IRS to the Education Department.
But the Education Department said that it would be taking additional steps to further reduce the number of families who are selected for the audits. “We are going to bring verification rates to among their lowest ever,” a department official told reporters.
In addition, the Education Department said it would not launch routine audits into whether colleges and universities are following federal student aid rules through June 2024. The department said it would only initiate new reviews of colleges if they suspect there is serious wrongdoing, such as fraud.
Another department official told reporters that the agency is currently averaging about 80 to 120 reviews into colleges’ administration of federal financial aid programs each year. The suspension of reviews would likely excuse “several dozen” colleges from unannounced compliance reviews in the coming months, the official said.
Officials will also give colleges and universities more flexibility in how they apply to renew their agreements with the Education Department to participate in the Pell Grant and student loan programs.
The department is waiving a requirement that colleges apply to renew their agreement at least 90 days before it expires. Colleges whose agreements are set to expire between now and September 2024 will be able to renew their agreements up until the expiration date.
The new, simpler application FAFSA went live at the end of December — already months behind schedule — and the Education Department has said that colleges won’t begin receiving the data they need to build financial aid packages for students until the “first half of March.”
The delays have already led some colleges across the country to push back admissions deadlines and more postponements are likely in the coming weeks.
The problems have led to bipartisan concern in Congress. Congressional Democrats on Monday pressed the Biden administration for answers on how they intend to help vulnerable students navigate through the FAFSA woes.
Republicans, meanwhile, have been scathing in their criticism of the administration’s handling of the new FAFSA. Rep. Virginia Foxx (R-N.C.), the chair of the House education committee, said the department’s latest actions fell short. “The reason students, parents, and schools are scrambling to deal with financial aid uncertainty is because of gross mismanagement by the Department,” she said in a statement. “End of story.”