Hirono, Colleagues Push for Funding to the Office of Federal Student Aid

~ Lawmakers: “We believe this funding request is needed to provide FSA with the resources it needs to fulfill its goal of ensuring that all eligible students and families can access federal student grants, loans, and work-study funds to pursue education and training beyond high school.” ~

WASHINGTON, DC – U.S. Senators Mazie K. Hirono (D-HI) joined Senator Elizabeth Warren (D-MA) and 23 colleagues in sending a letter to Senator Tammy Baldwin (D-WI), Chair of the Appropriations Subcommittee on Labor, Health and Human Services, education, and Related Agencies, as well as Senator Shelley Moore Capito (R-WV), Ranking Member of the Subcommittee, encouraging them to provide $2.7 billion in funding to the Office of Federal Student Aid (FSA) in fiscal year (FY) 2025.

“Fully funding the President’s request for FSA this fiscal year – a $625 million increase from the FY 2023 levels – is particularly critical given that FSA’s FY 2023 and FY 2024 funding was stagnant compared to previous years, severely undermining FSA’s ability to implement critical programs,” wrote the senators.

FSA is the largest provider of student financial aid in the nation, serving over 46 million people and overseeing a $1.6 trillion student loan program. It is tasked with making major improvements to student financial aid services, including an overhaul of the Free Application for Federal Student Aid (FAFSA). However, implementation of the FAFSA overhaul has been plagued by delays and glitches in processing, in part due to insufficient funding for FSA.

“Additional resources are necessary to fix the problems…, making federal student aid more accessible for more than 17 million students,” the senators continued.

FSA is also overseeing the return to repayment for student loan borrowers whose payments were paused during the pandemic and is working to implement a series of reforms to fix aspects of the student loan system that have failed borrowers.

“FSA’s responsibilities have increased to protect students and borrowers, but its federal funding has remained stagnant. The lack of adequate resources creates more barriers for students to start and continue their education,” concluded the senators. “We believe this funding request is needed to provide FSA with the resources it needs to fulfill its goal of ensuring that all eligible students and families can access federal student grants, loans, and work-study funds to pursue education and training beyond high school.”

In addition to Senators Hirono and Warren, this letter is also signed by Senators Tina Smith (D-MN), Cory Booker (D-NJ), Bob Casey (D-PA), Alex Padilla (D-CA), Richard Blumenthal (D-CT), Tammy Duckworth (D-IL), Peter Welch (D-VT), Tim Kaine (D-VA), Bernie Sanders (I-VT), Laphonza Butler (D-CA), Ben Cardin (D-MD), Dick Durbin (D-IL), Sheldon Whitehouse (D-RI), Chris Van Hollen (D-MD), Ed Markey (D-MA), Jack Reed (D-RI), Amy Klobuchar (D-MN), Ben Ray Luján (D-NM), Ron Wyden (D-OR), John Hickenlooper (D-CO), Michael Bennet (D-CO), Sherrod Brown (D-OH), and Maria Cantwell (D-WA).

The full text of the letter is available here and below.

Dear Dear Chair Baldwin and Ranking Member Capito,

As the subcommittee considers the Fiscal Year 2025 Labor, Health and Human Services, Education, and Related Agencies appropriations bill, we request you provide $2.7 billion – consistent with the President’s budget – to fund the Office of Federal Student Aid (FSA) within the Department of Education.

FSA is the largest provider of student financial aid in the nation, serving over 46 million people and overseeing a $1.6 trillion student loan program. FSA is responsible for managing the financial assistance programs authorized under Title IV of the Higher Education Act, which includes work-study, grant funding, and loan funds for students seeking college or a career and technical education. Fully funding the President’s request for FSA this fiscal year – a $625 million increase from the FY 2023 levels – is particularly critical given that FSA’s FY 2023 and FY 2024 funding was stagnant compared to previous years, severely undermining FSA’s ability to implement critical programs.

FSA is tasked with currently making major improvements to student financial aid services, including an overhaul of the Free Application for Federal Student Aid (FAFSA) as Congressionally-required through the Fostering Undergraduate Talent by Unlocking Resources for Education Act (FUTURE Act) and the FAFSA Simplification Act.  Combined, these two bills will expand access to federal aid and address longstanding concerns over the complexity of the application process, assuming Congress appropriates sufficient funds to FSA to complete the overhaul. The student aid application and award process have been widely critiqued for their length, complexity, and lack of transparency for students and their families. However, implementation has been plagued by delays and glitches in processing.  Additional resources are necessary to fix the problems and ensure that these laws are fully implemented, making federal student aid more accessible for more than 17 million students.

At the same time, FSA is charged with overseeing the return to repayment for student loan borrowers whose payments were paused during the pandemic – an unprecedented undertaking. It is critical that FSA have sufficient resources to reach these borrowers and ensure that they enroll in a repayment plan that meets their needs and do not fall into delinquency or default.

Further, FSA is working to implement a series of necessary reforms to fix aspects of the student loan system that have failed borrowers. These reforms include making long overdue improvements to the Public Service Loan Forgiveness (PSLF) program, including the transition of PSLF to FSA under the unified servicing system; increasing accountability efforts for student loan servicers; processing debt relief applications for defrauded borrowers and borrowers with a total and permanent disability; enrolling borrowers into the new and transformative income driven repayment plan, the Saving on a Valuable Education plan, that could cut borrowers’ monthly payments in half; and developing and implementing President Biden’s plans to provide student debt relief.

FSA’s responsibilities have increased to protect students and borrowers, but its federal funding has remained stagnant. The lack of adequate resources creates more barriers for students to start and continue their education. We believe this funding request is needed to provide FSA with the resources it needs to fulfill its goal of ensuring that all eligible students and families can access federal student grants, loans, and work-study funds to pursue education and training beyond high school. Thank you for your time and consideration of this request and your continued support in the strengthening of FSA.

Sincerely,

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