Financial Aid Decisions Slowed By Federal Processing Problem

Posted: March 7, 1996

Contact: Doug Anderson, doug.anderson@so.mnscu.edu, 651-201-1426

Students who plan to attend a Minnesota state university, community college or technical college next fall may have to wait longer than usual to learn how much financial aid they will be awarded to cover their educational costs.

This is because the processing of financial aid applications by the federal government has been plagued by a series of glitches. The result is a backlog of as many as a million applications and a corresponding delay in relaying financial aid eligibility information to the colleges and universities. Approximately half of the 151,500 students served by the Minnesota State Colleges and Universities (MnSCU) receive some form of financial aid.

All state colleges and universities use the information from the FAFSA (Free Application for Federal Student Aid) to determine a student's eligibility for federal Pell grants, work-study programs and loan programs. In addition, the FAFSA information is used in computing a student's eligibility for state grants and other aid. The federal delay means that state universities that had planned to mail out award notifications in mid-March will not be able to do so until early April or possibly even later.

The federal processing problem affects the data entry portion of the application process. Data from paper applications was to be inputted using a new imaging process this year. However, technical problems with both hardware and software quickly surfaced. Ordinarily, these problems would have been detected earlier in the processing cycle. The federal furloughs this winter eliminated that opportunity.

Federal Department of Education spokespersons say they hope to eliminate the backlog by March 31. In the meantime, the backlogged applications are being processed on a first-come, first-served based on the date of receipt. Students who are concerned about the status of their applications may call 1-800-4FED AID to learn the receipt date that is currently being processed.

In order to minimize the potential of increasing the backlog, the Department is encouraging students who have not yet filed a paper FAFSA to file an electronic FAFSA using software that is being mailed to 25,000 high schools across the country. Similar software is available at many colleges and universities. The electronic applications have not experienced the difficulties of the paper FAFSAs.