(GENERAL-24-93) Guidance on Means-Tested Benefits Outreach for Institutions and State Grant Agencies

Previously, the Department designated under Section 483(a)(3)(E) of the Higher Education Act of 1965, as amended (HEA) (20 U.S.C. 1090(a)(3)(E)) specific federal means-tested benefits for which institutions of higher education could use data from the FAFSA to identify students for outreach regarding their potential eligibility for such benefits. The opportunity to engage in outreach about students’ potential eligibility for specific federal means-tested benefits was extended to state grant agencies in GENERAL-24-35 if the state grant agencies signed the updated Student Aid Internet Gateway (SAIG) participation agreement, which included updates to the purpose of the agreement (Part Two, Section B). This electronic announcement provides guidance on means-tested benefits outreach that is applicable to institutions as well as those state grant agencies that signed a modified SAIG agreement. Once the state grant agency has signed and submitted the modified agreement to the Department (if it has not executed already), it can begin the outreach as described in this announcement.

Starting July 1, 2024, the full implementation of the FAFSA Simplification Act comes into effect. Under the HEA, as effective July 1, the use of FAFSA data for outreach about means-tested benefits by state grant agencies and institutions is now covered by Section 483. This amended language allows institutions and state grant agencies to use FAFSA data to target direct student outreach about means-tested benefits programs going forward.

This guidance only addresses the use and disclosure of FAFSA data (e.g., Student Aid Index (SAI) and Pell Grant eligibility) and does not address Federal Tax Information (FTI). For more information on access and use of FTI, see GENERAL-23-34 Access and Use of Federal Tax Information (FTI) for Federal Student Aid Programs Beginning with the 2024–25 FAFSA Processing Cycle. The Department will issue further guidance on access, disclosure, and use cases of FAFSA data and FTI data. State grant agencies and institutions are encouraged to consider how FAFSA data such as SAI and Pell eligibility can help target outreach to students who may be potentially eligible for means-tested benefits programs.

The Department recognizes that many college students struggle to cover their basic needs and living expenses (e.g., food, housing), which can delay or disrupt their academic progress. The following means-tested federal benefits programs have been determined as appropriate programs for which institutions and state grant agencies can use FAFSA data to target and conduct outreach (Sec. 479(b)(4)(H)):

Other means-tested benefits programs not listed but similar to those above can be eligible for the use of FAFSA data for outreach, so long as the institution or state grant agency determines that the eligibility criteria for such a program includes an income or asset threshold to determine a beneficiary’s standard of living and that targeted outreach using FAFSA data would benefit students’ application and enrollment for the programs for which they may be eligible. An institution or state grant agency must ensure their policies and procedures reflect the additional programs and any necessary determinations or processes that support the use of FAFSA data for the additional means-tested benefit program.

The Department reminds institutions and state grant agencies that for means-tested benefits outreach, they should limit FAFSA data use to what is required to inform their student population about these benefits. Institutions and state grant agencies must also follow applicable privacy laws and requirements under the Family Educational Rights and Privacy Act (FERPA), where applicable, for the disclosure of FAFSA data from students’ education records.

The Department understands that at some institutions, outreach about means-tested benefits may be conducted by staff other than financial aid administrators, such as basic needs coordinators, advisors, or other institutional staff. This is a permitted use of FAFSA data under Section 483(a)(3)(C)(i) of the HEA. In addition, under FERPA, an institution may disclose, without consent, FERPA-covered FAFSA data to such staff to conduct this outreach under the “school official” exception, provided that such staff fit within the criteria listed in the institution’s annual notification of FERPA rights for “school officials” and this outreach satisfies the criteria for having a “legitimate educational interest.” The institution must use reasonable methods to ensure that such staff obtain access to only that FERPA-covered FAFSA data in which they have a legitimate educational interest. Other data from the students’ Institutional Student Information Records (ISIRs) that is not necessary for this purpose could not be shared with these staff without prior written consent under Section 483(a)(3)(C)(i) of the HEA or FERPA.

The Department recognizes that as awareness of and attention to the issue of basic needs among college students grow, institutions and state grant agencies may have increased interest in coordinating with state and local benefits agencies to target outreach and assistance. Institutions and state grant agencies can develop a process for a student to provide explicit prior written consent to share FAFSA data with Federal, State, or local government agencies or tribal organizations to assist such student in applying for and receiving Federal, State, or local government assistance, or tribal assistance for any component of the student’s cost of attendance.

The Department is committed to ensuring that all students can receive the financial assistance necessary to attend and complete college. Institutions and state grant agencies are encouraged to consider how to implement basic needs outreach and coordination to serve their students. If you need additional information or have specific questions related to FTI and FAFSA data use, visit FSA’s Partner Connect webpage and select “Policy Guidance” to submit a question. For FERPA related questions, submit a question at: https://studentprivacy.ed.gov/contact. Further discussion of all the key terms, definitions, and systems related to the FAFSA Simplification and FUTURE Acts is available in the electronic announcement (GENERAL 23-63).