A recent policy passed in California that requires high schoolers to file financial aid applications led to a 69 percent completion rate in its first year of implementation, 2022–23 — up from a rate that historically hovered at less than 55 percent.
An estimated $550 million in potential state and federal dollars was forgone in 2020–21 alone due to the submission of so few applications.
In addition to reducing the amount of unclaimed aid, Assembly Bill 132 and subsequent legislation was put in place to boost the number of students finishing Free Application for Federal Student Aid (FAFSA) and California Dream Act Application (CADAA) forms —helping young people avoid missed opportunities, make informed decisions on their academic futures and ultimately increase college enrollment and access to the economic mobility that higher education can provide. Alternatively, families can choose to opt out.
A report, brief and webinar by the Public Policy Institute of California (PPIC) examine how rollout of the universal financial aid application initiative is going to date and gives policy recommendations for continued success.
Progress so far
In the policy’s initial year, FAFSA/CADAA completion rose 16 percent from 2020–21 — with the highest increase among low-income students. All racial/ethnic groups saw gains, with the greatest among Filipino students (9 percentage points) followed by their Pacific Islander, Latino, Native American and white peers, who saw increases of 8 percentage points, respectively.
Still, Native American (40 percent), Pacific Islander (49 percent) and African American (49) percent saw the lowest rates of completion in 2022–23.
In 2023–24, the statewide completion rate dropped to 60.5 percent as the introduction of a new FAFSA form, meant to simplify the process, had glitches.
Through site visits and interviews with staff and leaders at 21 local educational agencies of varying demographics, PPIC noted common obstacles to implementation including difficulty securing parent cooperation, trouble tracing completed applications, having school counselors with outsized caseloads and a confusing opt-out process.
Strategies that LEAs used to overcome challenges included building external partnerships, improving data sharing, managing policy information flow to students/families and offering incentives/competitions.
PPIC’s policy recommendations to ensure further progress include:
- Promoting financial aid application completion as part of the California School Dashboard
- Improving data sharing for schools and LEAs
- Coordinating efforts and building buy-in across stakeholders
- Building local and regional capacity to support students/families
Resources for 2025–26
On Nov. 21, the U.S. Department of Education published the 2025–26 FAFSA form for those seeking financial aid for college or career school.
The new form incorporates feedback from students, parents and educators and withstood multiple rounds of testing following the previous year’s botched rollout.
A number of accompanying resources, including a tool to help applicants determine who needs to provide contributor information and an aid estimator, are also available on the federal student aid website.
For California residents, the FAFSA should be completed by March 3, 2025. Find more information and all deadlines here.
