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Penn State feeling the effects of 'botched' federal student aid rollout

A front view of Old Main on Penn State's University Park campus.
Sydney Roach
A view of Old Main on Penn State's University Park campus.

The Free Application for Federal Student Aid, or FAFSA, underwent a recent overhaul to make things easier, but its rollout has caused stumbling blocks for both high school students and colleges, including Penn State.

Speaking during a university Board of Trustees committee meeting Thursday, Matt Melvin, vice president for enrollment management, outlined the "significant decline in the number of students applying for aid as a result of what I’ve called the FAFSA fiasco or the botched FAFSA rollout.”

Melvin noted a June Congressional Budget Office report predicts that nationally there will be about 490,000 fewer Pell-eligible students in this academic cycle than expected.

The 2023 CBO report had forecast 6.43 million Pell-eligible students this year, while the new report forecasts 5.94 million. Students need to complete a FAFSA to qualify for a Pell Grant.

As of May, the number of Pennsylvania high school students who had filed a FAFSA was down 15%, Melvin said. That number is shifting, though, and Melvin said the decline is now 11%.

"The cycle is still active," he said.

He said student deposits for the fall at University Park are keeping up with the goal of 9,500 new students. Earlier this year, the university announced plans to boost enrollment at University Park starting this fall, increasing the number of new students in fall 2024 from 9,175 to 9,500.

Penn State is seeing declines in deposits so far at the Commonwealth Campuses. But Melvin said that’s in flux.

“We will continue to process applications, we will continue to process deposits, we will continue to process orientation reservations," he said.

He said the campuses are working closely with communities to reach out to families and encourage students to submit their FAFSAs.

Anne Danahy has been a reporter at WPSU since fall 2017. Before crossing over to radio, she was a reporter at the Centre Daily Times in State College, Pennsylvania, and she worked in communications at Penn State. She is married with cats.