A Higher Education Holiday Miracle
Just in time for the holidays, Congress has come to an agreement on another Covid-19 relief package and a funding bill for the federal government. Included in these bills are major changes to FAFSA, Pell Grant eligibility, funding for higher education, and other policy and relief to help students. These changes represent some of the most significant changes to federal higher education laws in over a decade and will make college more affordable and accessible for millions of students.

After an unbelievably difficult year for millions of students across the country these changes, some of them years in the making, are cause for celebration. Many of these changes could not have happened without students advocating for them year after year, meeting with their legislators on Capitol Hill and sharing their stories. As more information becomes available on these changes and others within the bills, LeadMN will provide further updates.

FAFSA Simplification
Due to the current length and complexity of the FAFSA, eligible Minnesota students miss out on millions of dollars in Pell Grants each year. After over six years of federal advocacy by LeadMN, a major simplification of the FAFSA is finally happening. This overhaul will:

  • Reduce the number of questions from 108 to a maximum of 36
  • Decrease the use of verification by using IRS data
  • Create simpler Pell Grant eligibility guidelines so applicants will know how much they will get for college ahead of time.

Simplifying the FAFSA will provide a major increase in access to grants and loans to help make college more affordable for low-income students and will allow high school students to better plan for their post-secondary education. This change is a massive win for students in Minnesota and across the country.

Pell Grant Eligibility and Increase
In 2019 LeadMN students passed support for providing Pell Grants to incarcerated individual as part of our platform. After twenty-six years, Congress has finally agreed to lift the prohibition on Pell Grant use by incarcerated individuals. This change will allow thousands of incarcerated individuals to pursue an education that will allow them to find work after being released and significantly reduce their risk of reoffending. Also included is a repeal of the 1998 law that prohibits students convicted of drug offenses from receiving federal financial aid. Students will no longer be required to answer the drug offense or selective service question on the FAFSA. These changes represent another positive modification supported by LeadMN’s advocacy platform.

With the FAFSA simplification and Pell Grant eligibility changes an additional 550,000 students will now qualify for Pell grants each year and an additional 1.7 million students will now qualify to receive the maximum Pell grant award each year. This fall students will also see the maximum Pell Grant award rise to $6,495, an increase of $150.

Funding for Student Emergency Grants and Colleges
Included in the relief package is $23 billion in funding for higher education institutions. In the CARES Act this past spring colleges were required to spend 50% of the funding they received on emergency grants, but this has changed. Under the new relief bill colleges do not have to spend 50% on emergency grants but must spend the same amount on student emergency grants as they did under the CARES Act earlier this year. This emergency funding will provide critical relief to students as the economic impacts of the pandemic continue to provide significant challenges.

Colleges have also been given more flexibility to spend funds on costs associated with COVID-19, including lost revenue, payroll, and reimbursement for expenses that have already occurred. This flexibility has been extended to any remaining CARES Act funds colleges may have.

Stimulus Checks
Just like the CARES Act stimulus checks distributed in April, individuals making up to $75,000 a year will receive a direct payment of $600, while couples making up to $150,000 will receive $1,200, in addition to $600 per child. These payments will hopefully be dispersed within a few weeks.

SNAP Eligibility
With millions of students facing food insecurity, Congress has approved major temporary changes to SNAP to provide relief during the pandemic. Students who are enrolled at least half time, eligible to participate in state or federal work-study, and students who have a $0 Expected Family Contribution, will now be eligible to receive SNAP benefits. The Secretary of Education must also inform students of these temporary changes. These changes, coupled with the notification to students, will help make millions of students eligible and aware of their eligibility for SNAP benefits. In addition to these changes, Congress has allocated an additional $13 billion to increase food stamp benefits by 15 percent.

Broadband Access
Over the past year, LeadMN has joined with national partners to advocate for expanded broadband access for students. Congress has allocated $7 billion to increase broadband access for students, families and unemployed workers. Of this funding, $300 million is dedicated for rural broadband, and $250 million for telehealth.

Other Notable Provisions

  • Repeal of the limitation on lifetime subsidized loan eligibility that prevents students from receiving subsidized direct loans for more than 150% of their program length.
  • Forgiveness of $1.3 billion in federal debt held by Historically Black Colleges and Universities (HBCUs) with loans under the federal Capital Financing Loan Program
  • A $300 per week increase in unemployment insurance benefits

Not Included: Student Loan Relief
An extension of federal student loan relief that is set to expire on January 31st, 2021 was not included in the relief or appropriations bills. There is a high probability that an extension of the loan payment relief and the freeze on interest accrual would be extended after the President-Elect Biden’s inauguration on January 20th.