Policy Recommendations

Using FAFSA Data to Secure Today’s Students' Basic Needs

Three recommendations to the Administration to increase access to means-tested public benefits in postsecondary education through outreach and data sharing

Higher Learning Advocates’ (HLA) federal policy recommendations identify opportunities for ensuring students’ basic needs are met, a critical component to their postsecondary success. Basic needs insecurity adversely affects students’ well-being, as well as their college persistence and completion. Research shows food and housing insecurity are contributing factors to lower graduation rates.1 Recent national data found 23% of undergraduate students experienced food insecurity and 8% of undergraduates faced homelessness. Thirty-one percent of Pell recipients are food insecure. Basic needs insecurity affects 35% of Black students, 30% of Native American students, and 25% of Hispanic students.2

Higher education funding alone is not enough to meet those needs. We cannot afford to segment support systems. The data are clear; for students with low-incomes, who may be juggling a mix of work, school, and family responsibilities, the combination of need-based financial aid and enrollment in public means-tested benefits programs such as the Supplemental Nutrition Assistance Program (SNAP), subsidized health insurance, broadband assistance, and tax credits could help increase student completion rates.

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Just one-quarter of institutions of higher education are conducting direct outreach — with or without — using FAFSA data

SNAP Benefits icon

Institutions that conduct outreach communicate most frequently about SNAP and broadband assistance, with and without using FAFSA data

Institutions icon

Institutions provided information to students about how to apply for benefits and criteria information; few share information with other government agencies.

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Sixty percent of institutions do not conduct direct outreach; citing resource constraints.

Policies that create eligibility for students are only part of the solution. Transparent and convenient application procedures must be available to ensure true access. While millions of college students are eligible for such benefits, many are unaware of their eligibility or do not know how to apply. For instance, roughly 2 million of the approximately 3.3 million students who are eligible for SNAP do not participate, leaving roughly $3 billion in benefits on the table.3

In January 2022, the U.S. Department of Education (ED) addressed the disconnect between need and access by encouraging institutions of higher education (IHEs) to connect students to means-tested benefits. Dear Colleague Letter “Use of FAFSA Data to Administer Federal Programs” (the DCL) addressed how Free Application for Federal Student Aid (FAFSA) data could be used to inform students of their potential eligibility for public benefits.4 The intent of the DCL was simple: by using the information that students have already provided on the FAFSA, financial aid administrators and other campus stakeholders are able to conduct targeted and personalized outreach to students and significantly simplify their access to benefits for which they are eligible.

But a recent survey conducted by HLA and the National Association of Student Financial Aid Administrators (NASFAA) found that less than ⅓ of institutions surveyed were conducting the type of outreach that is permitted under the DCL and more than 40% reported that they had no plans to do so in the future.

The DCL notes that IHEs may provide information to students about SNAP, the Affordable Connectivity Program (ACP), health insurance enrollment through the Affordable Care Act and Medicaid, and the Child Tax Credit. Eligibility for many of these benefits was expanded through COVID-era legislation, which created new opportunities for institutions to connect students with benefits using this type of data sharing. ED encouraged IHEs to coordinate with a range of campus stakeholders, such as financial aid administrators, student organizations, faculty and staff advisors, or student life groups, to broadly inform students about the range of benefits for which they are likely eligible.

ED’s goal, which we share, was to help students be aware of the assistance under these programs and in some circumstances simplify the application process for students. The guidance outlined in the DCL would ensure that students can both access the benefits for which they are eligible and raise awareness of potential eligibility. But, with so few IHEs using this authority, there is still significant room for improvement.

Policy Recommendations

Policy Recommendation 1: Provide Further Guidance

The current uptake of the January 2022 DCL falls short of the potential. While the majority of institutions that do not conduct outreach reported capacity concerns, there were additional areas of confusion and concern that held institutions back. Additionally, recent changes in law have raised new questions and concerns.

Clarify what are considered protected data under the Family Educational Rights and Privacy Act (FERPA) in regard to data sharing within an institution.

In interviews with aid administrators and experts, we heard two interpretations of what is permitted with FERPA: first, that aid administrators are the only ones with authority in the IHE to use FAFSA data to reach out to students about their potential eligibility for benefits; and secondly, that aid administrators can share FAFSA data such as Pell receipt or Federal Work-Study eligibility with benefits navigators employed by the IHE in a basic needs center who can then reach out to students about potential eligibility for benefits.

Our reading of the intent of the January 2022 DCL is consistent with the latter. A higher education official does not need a student’s permission to share FAFSA data with permitted sources within the institution. However, HLA’s research clearly reveals there is disagreement in the field about the interpretation, and further guidance and clarification from ED are needed to determine whether a student’s signature is only required if the school shares the student’s FAFSA data with an outside entity, like a county or state SNAP agency.

Multiple pieces of guidance

In 2021 and 2022, ED informed institutions they had designated the Federal Communication Commission, the U.S. Department of Health and Human Services, the U.S. Department of Labor, and the U.S. Department of Agriculture, Food and Nutrition Service, as entities that can use FAFSA data to aid in the administration of programs, such as the ACP and SNAP. The designation guidance supported broad outreach and collaboration with other campus stakeholders to students who could be eligible. For instance, the ED guidance regarding the DOL notes that, “ED encourages IHEs to coordinate with campus stakeholders to inform their student population of this benefit during the COVID-19 emergency. Institutions may utilize a FAFSA applicant’s email address and other information to target and notify affected students that may be eligible for this benefit.”5 The January 2022 DCL is even more explicit, noting, “ED encourages IHEs to coordinate with campus stakeholders, such as student organizations, financial aid administrators, faculty and staff advisors, or student life groups, to broadly inform their student population about the range of benefits for which they may be eligible.”6 Both of these statements point toward trusted campus stakeholders as having the authority to conduct outreach to students, based on their FAFSA data, about benefits for which they may be eligible.]

Update the guidance to make clear that state university systems, community college systems, and state student aid and authorizing agencies may also use these data.

In the survey HLA conducted with NASFAA, six out of 10 institutions reported they do not share data with state agencies, even with student authorization. Further, only 14% of respondents shared student data with agencies with students’ permission.

Sharing data with systems could help to spread the capacity load. The survey results show many institutions do not believe they have the capacity to conduct the outreach necessary to connect more students to the essential public benefits that could address their basic needs insecurity. ED could address the challenge by updating the guidance to clarify the cases in which state university systems, community college systems, and state student aid and authorizing agencies may also use this data. These systems and agencies, which are already familiar with FERPA requirements and protecting student data, may have more capacity and resources to conduct direct, targeted outreach to students with low incomes about their potential eligibility for public benefits. Updating the guidance could dramatically expand the reach of the DCL.

When issuing the new FAFSA, ED should clarify what is considered federal tax information and what is not on the new FAFSA, so aid administrators are clear about what can and cannot be used for outreach.

In December 2020, Congress enacted the FAFSA Simplification Act, which made significant and student-friendly improvements to the student financial aid application process and formula. One of those changes enables students to directly import their tax information — including their adjusted gross income (AGI) — from the IRS to determine their eligibility for Pell Grants and student loans. The law allows ED to disclose personally-identifiable FAFSA information to agencies that handle applications for means-tested benefit programs, but disclosures cannot involve information that’s transferred directly from the IRS (e.g., AGI) and it requires the individual applicant (and, where relevant, their parents our spouse) to provide explicit consent.

ED should issue guidance alongside the new FAFSA that clarifies what is considered federal tax information and what is considered education data.

Students surrounding computers

Policy Recommendation 2: Gain Student Permission to Share Information as Early as Possible

Add a checkbox to the FAFSA as to whether a student is interested in being contacted about potential benefits eligibility.

The survey showed that some aid administrators and other stakeholders are concerned about violating the FERPA rules by using students’ personal financial information to conduct outreach and connect students to benefits, without express student permission. Survey findings revealed almost a quarter of IHEs reported they did not conduct outreach because they feared using FAFSA data incorrectly. And significantly more — almost four out of 10 — public four-year institutions reported the same concern.

FERPA is a necessity to protect students’ privacy, however, its requirements, and interpretations of those requirements, can also be viewed as barriers to helping students across many areas, including access to assistance to which they are eligible. Varied interpretations of FERPA, as well as variable enforcement often stymie outreach efforts, as well-intentioned as they might be.

To ameliorate institutional risk aversion and help institutions identify students who may be in need of additional supports, ED should include a checkbox on the FAFSA itself to allow students to authorize ED, institutions, and other relevant entities to share the necessary information and inform students directly about their potential eligibility.

Policy Recommendation 3: Enact Additional Administrative Actions

The Administration should enter into data sharing agreements as soon as possible to alleviate the burden of information sharing from institutions and encourage greater adoption of outreach programs to students.

The updated Higher Education Act states, “The Secretary may enter into data sharing agreements with the appropriate Federal or State agencies to conduct outreach regarding, and connect applicants directly with, the means-tested Federal benefit programs…for which the applicants may be eligible.” As noted above, over the course of the COVID-19 pandemic, ED already designated many of those agencies as entities that can use FAFSA data to aid in the administration of programs, a significant step toward creating data sharing agreements.

The results of HLA and NASFAA’s survey found that more than 70% of institutions that did not conduct outreach cited capacity concerns as a reason. And almost 90% of public four-year institutions that did not conduct outreach cited resource constraints.

Determine what other means-tested benefits programs should be added to the FAFSA question about the receipt of means-tested benefits.

The 2024-2025 FAFSA asks whether a student receives several benefits. These include the Earned Income Tax Credit, federal housing assistance, Free or reduced-price school lunch, Medicaid, a refundable credit for coverage under a qualified health plan, SNAP, Supplemental Security Income, Temporary Assistance for Needy Families, and the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC). The HEA authorizes the Secretary of Education to add “any other means-tested program determined by the Secretary to be appropriate.”7 We request that the Secretary add more public benefits programs, including the Affordable Connectivity Program, Low Income Home Energy Assistance Program, Unemployment Insurance, the Child Tax Credit, and the American Opportunity Tax Credit and/or Lifetime Learning Credit. These programs also promote student basic needs security, and the tax credits are worth thousands of dollars to low-income students. All have been targets for increased outreach by the federal government, as well.

Notify participants in means-tested programs of their potential eligibility for the Pell Grant.

In November 2016, U.S. Secretary of Education John B. King, Jr., announced a joint agency letter “Aligning Federal Supports and Program Delivery for College Access and Completion” that highlighted how benefits access for postsecondary students can support college completion, as well as how access to postsecondary education and training could serve as a pathway out of poverty for those receiving public benefits.8 The six-agency letter addressed both populations, noting “it is critical to ensure current means-tested benefits recipients access educational and training opportunities, and to connect eligible students with available federal supports and to partner with states to ensure these resources effectively support their communities.”9

The Obama administration also sent a letter to Unemployment Insurance recipients about their potential eligibility for student aid. A subsequent study found that recipients of the letter were 40% more likely to enroll in higher education.10

HLA believes there is an untapped opportunity for the Biden administration to conduct outreach about the availability of the Pell Grant to pay for college to those receiving means-tested benefits.

Student in library book aisle

Provide technical assistance to institutional stakeholders on best practices for using FAFSA data to increase students’ access to means-tested benefits.

In addition to the updated and new guidance recommended above, ED should provide technical assistance to stakeholders to improve their understanding of this recently issued guidance and any forthcoming expansion of such guidance. The survey as well as our interviews exposed a range of comfort, approaches, and willingness to use this critical information to connect students with public means-tested benefits. ED has options, including at the annual FSA conference, to create opportunities for further assistance to institutions.

Helped students apply for benefit program(s)
Told students they appear to qualify for benefits program(s)
Told students the eligibility criteria for benefits program(s) but not whether we believed they would qualify
Shared how to apply for federal benefits program(s) (e.g., website info, phone numbers, etc.)
Provided documentation students could use to apply for benefit program(s)
Offered assistance to students in applying for federal benefits program(s)
Don’t know/Unsure


  1. Wolfson, J., Insolera, N., Cohen, A. and Leung, C. (2021). The effect of food insecurity during college on graduation and type of degree attained: evidence from a nationally representative longitudinal survey. Public Health Nutrition: 25(2), 389–397. https://www.cambridge.org/core/services/aop-cambridge-core/content/view/4048E0A71FB2CB5B6B7C984AC1AE5F9E/S1368980021003104a.pdf.Hallett, R. E. and Freas, A. (2018). Community college students’ experiences with homelessness and housing insecurity. Community College Journal of Research and Practice. 42(10), 724-739. https://eric.ed.gov/?id=EJ1186316.
  2. https://saragoldrickrab.com/wp-content/uploads/2023/07/NPSAS-Estimate-Memo-SGR-7.28.23.pdf.
  3. United States Government Accountability Office (2018). Food Insecurity: Better Information Could Help Eligible College Students Access Federal Food Assistance Benefits. https://www.gao.gov/products/gao-19-95.
  4. https://fsapartners.ed.gov/knowledge-center/library/dear-colleague-letters/2022-01-20/use-fafsa-data-administer-federal-programs
  5. https://fsapartners.ed.gov/knowledge-center/library/electronic-announcements/2021-05-12/additional-designations-entities-under-section-483a3e-higher-education-act-and-institution-higher-education-ihe-guidance-ea-id-general-21-30.
  6. https://fsapartners.ed.gov/knowledge-center/library/dear-colleague-letters/2022-01-20/use-fafsa-data-administer-federal-programs.
  7. Section 483 (a)(2)(B)(ii)(XVII) of the Higher Education Act.
  8. The letter was released through a collaboration by the U.S. Departments of Agriculture, Education, Health and Human Services, Housing and Urban Development, Labor, and Treasury. It reflected years of interagency work.
  9. https://www2.ed.gov/documents/press-releases/federal-supports-college-access-completion.pdf.
  10. Barr, A. and Turner, S. (2017). A Letter and Encouragement: Does Information Increase Post-Secondary Enrollment of UI Recipients? National Bureau of Economic Research. Working Paper 23374. https://www.nber.org/system/files/working_papers/w23374/w23374.pdf.