Thursday, Sep 26, 2024
Congressional Independent Colleges Caucus Seminar Series
The Impact of FAFSA Delays on Fall 2024 Enrollment
September 24, 2024 | Capitol Hill
Presented by Gregory G. Dell’Omo, Ph.D., President, Rider University
Good morning. My name is Gregory Dell’Omo and I am the president of Rider University in Lawrenceville, New Jersey. I appreciate this opportunity to speak before you to address a significant change that is reshaping the landscape of higher education: the rollout of the new FAFSA system.
As you know, this Congressionally mandated overhaul was designed with one primary goal—to simplify the financial aid process and make it more accessible for students and their families. However, the road to implementation has brought about substantial challenges for universities, financial aid staff, and most importantly, students and their families.
I think it is fair to say that in theory, many of us in the higher education industry were originally encouraged by the promise of a new FAFSA, a more streamlined application process with fewer questions that better aligns with the financial realities of students. This is especially beneficial for low and middle income families, meant to ease the burdens of college affordability. But as with any large-scale system transformation, the transition was not without its complications.
At Rider University, the delays in receiving FAFSA data from the federal government were particularly challenging last year. Our university, like many others, had to navigate the increased stress placed on both students and financial aid staff. Prospective students, unsure of how much aid they would receive, were forced to make decisions about their future without a full picture of their financial aid options.
This led to declines in enrollment yields, even when interest and engagement from applicants was otherwise strong.
Before I get into specifics, let me first tell you a little about Rider University, a distinguished institution with a rich history that dates back to 1865.
Originally founded as Trenton Business College to educate soldiers returning from the Civil War, Rider has evolved into a comprehensive university, offering a wide range of undergraduate, graduate and doctoral programs across numerous disciplines. Rider’s programs are housed in three colleges, the Norm Brodsky College of Business, The College of Arts and Sciences, and the College of Education and Human Services.
Rider’s location between New York City and Philadelphia, provides students with access to two major metropolitan areas, creating unparalleled opportunities for internships and career development, a cornerstone of our engaged learning program which requires students, as a condition for graduation, to undertake high-impact learning activities outside of the classroom to supplement their classroom instruction.
Rider also prides itself on a rich and vibrant student life. With about 3,500 undergraduates and 1,000 graduate students, the university fosters a tight-knit community. Students can choose from over 100 clubs and organizations, from Greek life to academic societies. And for athletes, Rider’s 21 athletic teams, known as the Broncs, compete in NCAA Division I across a variety of sports, including basketball, baseball, soccer, swimming, field hockey, track and field, lacrosse, softball, tennis, golf, wrestling and more.
Rider is consistently recognized for its strong academics. Publications like The Princeton Review’s Best 390 Colleges and U.S. News & World Report have acknowledged our university for its academic quality and value.
In terms of affordability, Rider remains competitive with other private institutions, and in some cases with public institutions. We offer generous financial aid packages, scholarships, and grants, helping make education accessible to students from all backgrounds.
We recently announced our new Tuition Guarantee Program, designed to provide free tuition to eligible New Jersey residents who maintain a GPA of 3.5 or higher, have a household income of $50,000 or less, and receive full financial aid through both Pell and Tuition Aid Grants.
This initiative is aimed at closing the gap after other scholarships and grants are applied, making education more accessible for students who meet the academic and financial criteria. It is available to both incoming first-year and transfer students beginning in the fall of 2025 or spring 2026. Students must apply to Rider, complete the FAFSA, and meet deposit deadlines to be considered for the program.
Like most smaller, private universities, Rider is a tuition-dependent institution. A significant portion of our operating revenue comes from tuition and fees paid by students. This reliance on tuition is common among institutions like ours, especially those without large endowments or significant external funding sources.
Tuition-dependency makes institutions like Rider particularly sensitive to changes in enrollment numbers, which, unfortunately, was just what we saw last year as a result of the delayed rollout of the new FAFSA form.
As you already know, the delay created significant uncertainty for students and families, particularly those relying on need-based aid, as they waited longer than usual for critical financial information. This led to disruptions in decision-making for prospective students, even those not expecting to receive substantial aid.
As a result, Rider, like many other private institutions, experienced difficulties in finalizing enrollment numbers, with yields declining despite positive engagement metrics.
Let me give you a few specifics.
Going into last fall, we were very encouraged at the start of our enrollment cycle. To be honest, it felt as if this was going to be the first year since the pandemic when things felt, dare I say, a bit normal.
In fact, we were seeing record engagement from prospective students, with unique campus visits up by 17%, applications up by 11% and acceptances up by 10% from the previous year. With such positive momentum, we all felt as if we were getting back to a pre-pandemic enrollment cycle, and to be very honest, our entire campus community was really excited about the trend we were experiencing.
And then, things took a turn. What resulted was a two-fold problem. First, there were simply just fewer FAFSA applications being completed, and second, institutions experienced monthslong delays for information for those that did.
In a normal year, while Rider utilizes a rolling admission process, we pride ourselves on receiving FAFSA data and providing financial aid offers to students as early as possible, beginning in October. Additionally, we make a commitment to those who apply by November 15, that we will provide their acceptance decision and financial aid package by the end of the calendar year. Because that was not possible last year, we had to push back that promise by more than five months. This clearly resulted in students and families not being able to make timely, well-informed enrollment decisions.
Remember earlier I mentioned that Rider was having a very positive start to last year’s enrollment cycle. If the FAFSA simplification was implemented well, or even if the timing had stayed the same as prior years, we would have expected an 8% increase in FAFSA completions due to the increase in our applications. But in reality, we realized a 7% decline in FAFSA completions.
The decline was particularly pronounced among low-income, underrepresented and first generation students, many of whom were unfamiliar with the new changes and deadlines, leading to confusion and missed opportunities for aid.
At Rider, we saw that FAFSA completions declined 9% among Hispanic students, 8% among Black students, 19% among Asian students and 13% among white students.
By spring, it became clear that the normal May 1 deposit deadline was not going to be realistic, so we made the decision, like many other institutions, to push our deposit deadline to June 1. However, families were still faced with making enrollment decisions in a compressed time frame, often without a full understanding of cost.
This reality had a significant impact on yield, which is the percentage of students who accept their offer of admission.
Rider’s average pre-pandemic yield stood at 13%. But in the first full year of the pandemic, in Fall 2021, it fell to 8.9%. Afterwards, it was gradually recovering, to 10% in Fall 2022 and then 11.2% in Fall 2023. Given this improving trend, we were encouraged to set our Fall 2024 rate at 11.9%, which would have resulted in approximately 940 new students.
But delays in being able to apply for the FAFSA, longer delays in receiving financial aid awards, and the decline in the number of families who even completed the FAFSA last year brought our yield down to 9.1%, or 721 new students, far below our first-year enrollment goals for the year.
As you may know, when first year enrollment goals are not met, it is not just a one-year-problem, but rather a four-year problem that impacts the university’s financial position.
One additional impact of the FAFSA situation that I believe is not discussed enough, is the significant impact it had on financial aid staff at universities like Rider.
As you can imagine, our employees faced increased stress and longer working hours due to the delay in processing aid awards. On a daily basis, staff were dealing with frustrated parents and students who were unsure about their aid packages and whether they could afford to attend Rider. We often found ourselves counseling families to prevent them from over-borrowing private loans to circumvent the delays they were experiencing in getting FAFSA aid information.
It should be pointed out that the FAFSA was not just impacting just first-year families, but returning students and families were also facing uncertainty. After having a record freshmen-to-sophomore retention rate in Fall 2023, we experienced a two percentage point drop in the rate this year, a portion of which we clearly attribute to the FAFSA situation.
Once FAFSA information did become available, our financial aid office had to process packages more quickly than normal and in significantly compressed time periods, often working long, arduous hours. This situation was also confounded by the inconsistent and often contradictory direction from the Department of Education in providing guidance to our financial aid staff. This was in addition to the lack of batch processing availability to resolve conflicting information. To this date, we still have to submit professional judgements manually. This has led to countless hours of manual processing through the new and unfamiliar FAFSA partner portal system.
All of this unnecessarily prevented financial aid counselors from doing the most important job... counseling students and families. Additionally, these inconsistencies in guidance and processing from the Department leave institutions vulnerable and at risk in maintaining compliance with Title IV regulations.
While I am so grateful for the dedication of the entire Rider team who rose to the occasion during this stressful time, it comes as no surprise that this situation exacerbated burnout among the staff, and as a result, we are now seeing an extraordinarily high turnover of staff in that department.
According to a recent survey conducted by the National Association of Student Financial Aid Administrators and the College and University Professional Association for Human Resources, over 50% of financial aid counselors are considering leaving their profession within the next year. The increase in administrative burden from the complexities of the FAFSA situation is a main reason these employees feel strained and overwhelmed, driving them to seek employment in other higher education roles or entirely different sectors.
At Rider, approximately half of our entire financial aid staff turned over in the past year. We currently have three vacant positions within our financial aid office, and are having a difficult time finding qualified candidates who want to assume these roles. As we go into the next enrollment cycle, filling these roles and then training new staff as quickly as possible is going to be crucial.
We are grateful that the Department of Education has extended the timeframe for implementing the Financial Value Transparency and Gainful Employment reporting until January. Without this change, the pressures on our Financial Aid and Registrar Offices would have been even greater.
Looking forward, institutions that rely heavily on tuition revenue, such as Rider, need a level of confidence that the FAFSA application will be available by Dec. 1, as announced.
Institutions have done their part in becoming more proactive in guiding prospective and current students through the new system to ensure that those eligible for aid are not left behind due to bureaucratic hurdles. It is imperative that the FAFSA issues are addressed to ensure that every student has access to the financial resources they need for their education.
Thank you for your time today, and willingness to learn more about this important issue.