How the FAFSA fiasco may transform the Education Department

After the bungled launch of the new Free Application for Federal Student Aid last year, officials at the U.S. Education Department knew they had to do things differently for the next financial aid cycle.

One of the first moves they made was to bring in outside help. The Office of Federal Student Aid, which oversees the FAFSA, hired two senior leaders at the nonprofit College Board to head up the 2024–25 rollout: Longtime College Board president Jeremy Singer took on the role of new “FAFSA czar,” and chief information officer Jeff Olson was hired to help run the technical side. This year’s FAFSA, which launched in late November, has been decidedly better received, and completion rates so far are on par with previous years.

Singer and Olson ended their temporary stints at the department last month to resume their respective roles at College Board. On their way out, they sent a memo to the FSA detailing the challenges they faced and the lessons they learned, in the hopes that “it will be useful … now and in the future as the work continues to strengthen FAFSA.”

The memo, which Singer shared with Inside Higher Ed, detailed some of the shortcomings they found at the department, including poor management of multiple outside software vendors, scattered leadership priorities and unrealistic timelines.

Singer and Olson recently spoke with Inside Higher Ed at length about their experience. Both said they saw a well-intentioned but dysfunctional system at the heart of the FAFSA fiasco, and that the effort to fix the form required significant changes to how the FSA usually operates—changes they hope will have a lasting impact.

“We heard from an engineer who had worked on FAFSA for 30 years, who said that the collaboration we had during [the 2024–25 FAFSA rollout] was the most productive of his entire career,” Olson said. “There’s momentum there.”

Education Department officials who spoke with Inside Higher Ed on background said that difficult but necessary changes were made to the federal aid process for this year.

“I found the whole thing terribly refreshing—also terribly frustrating, because there was still a desire on the part of many in government to control what was going on. But people needed to just let go and let it evolve,” one current department official, who asked to remain anonymous to speak candidly about the process, told Inside Higher Ed. “It was so transformative, the idea that we didn’t have to do things the way we’d always done. For government, that’s big.”

Former under secretary of education James Kvaal, who oversaw both the 2023–24 rollout and this cycle’s relaunch, told Inside Higher Ed that the primary challenge facing the FSA—both then and now—is a staffing one.

When the first Trump administration took office in 2017, officials issued a hiring freeze that Kvaal said hamstrung the agency for years, even into the early Biden administration. Now Trump has issued another freeze, which Kvaal worries will exacerbate the problems that contributed to the FAFSA issues in the first place, like the shortage of full-time technical expertise and subsequent reliance on third-party contractors.

“FSA has some extremely talented and dedicated staff, but it doesn’t have enough of them,” Kvaal said. “I think that has a cost on the health of the organization.”

Still, he acknowledged that the past year unearthed some structural issues with the way the department oversees federal aid.

“It was a very challenging project that exposed some of the weaknesses of the department as an organization,” he said.

Unearthing Structural Problems

Kvaal, Singer and others at the department agree on at least one thing: FSA relied too heavily on third-party contractors.

Singer said those vendors struggled to coordinate or meet deadlines. But because of the extensive history they had in overseeing the FAFSA, it was also impossible to work without them. Coming from the private sector, he was shocked by the power some contractors held—especially General Dynamics Information Technology, which he said was a major source of frustration. In his memo, he wrote that GDIT’s “software code quality was low, with poor development and deployment processes and negligible unit testing, creating a high risk of regression”—in other words, threatening to undo the department’s progress in fixing the form’s outstanding technical issues from 2023–24.

“You never want a contractor to own the crown jewels of your software, especially very complex software you’re trying to oversee changes on. It’s just dangerous,” Singer said. “But in government, this is the norm. So it made sense to me how [FSA] ran into all the challenges they did last year.”

Kvaal agreed that coordinating with the vendors was frustrating and said that was a major reason for the FAFSA delays. The department has since put in place dedicated in-house engineers with the technical knowledge to oversee the vendors’ progress.

“Handing off huge amounts of work to outside contractors and hoping it all comes together at the end is risky,” Kvaal said. “I do think that these projects would be less risky if FSA had more in-house expertise and could do more of the work itself, or at the very least manage the contractors more closely.”

Kvaal and Singer also agreed that FSA’s FAFSA oversight was hurt by a lack of centralized leadership over the form. For decades, the FSA’s chief operating officer was technically in charge of the FAFSA, along with disparate policy issues like student loan management. Richard Cordray, the COO for most of the Biden administration, resigned last spring, due in part to backlash from the FAFSA rollout’s mismanagement.

“There was no clear owner of FAFSA,” Singer and Olson wrote in their exit memo. “There were disorganized and redundant meetings, at a time when every minute mattered. And while well-intended, some of the involvement from leadership outside FSA hindered progress, as these individuals didn’t have software expertise and their judgement was clouded from the negative experience the prior year.”

FSA leaders took this note to heart. After Singer’s departure, the FSA appointed Aaron Lemon-Strauss, another College Board alum who was brought in to help with the relaunch last fall, as its first full-time FAFSA program director. They also hired more technical support staff in the waning days of the Biden administration and implemented stricter guidelines for oversight of software vendors.

Shifting Strategies

The anonymous department official said FSA officials had been reluctant to acknowledge, both publicly and internally, the challenges they faced. The official said that in December 2023, weeks away from their congressionally mandated deadline, it was clear that they wouldn’t be able to put out a working form—but they insisted on doing so anyway, which marred the launch and jump-started a year of crisis.

“I think culturally there was a resistance to saying, ‘Hey guys, this is broken. We can’t do this,’” the official said. “I remember in late December of 2023 thinking, ‘It’s not going to happen.’ Because why launch something that’s broken?”

Karen McCarthy, vice president of public policy and federal relations at the National Association of Student Financial Aid Administrators, said that lack of transparency was financial aid professionals’ biggest gripe with the department during the 2023–24 cycle.

“It’s one thing to run into unexpected challenges; it’s another to not tell anyone about it,” she said.

Kvaal said he understood why people were frustrated with the department’s communication style during the 2023–24 rollout, but that department officials were struggling to keep up with developments themselves.

“That winter, there was a lot of uncertainty about timelines and whether we could even trust those we were being given [by third-party contractors],” he said. “The goal of providing the most accurate, actionable information to the field—it was not always clear how to do that.”

Olson said FSA worked in public during this past FAFSA cycle, sharing their uncertainties as they arose.

“It’s uncomfortable to write a blog post saying, ‘We were trying to fix this bug, and we created a different bug in the process.’ But ultimately, defensiveness doesn’t defend you from anything,” he said.

Over the past few months, McCarthy said, the department has worked hard to restore the community’s trust in FSA. She and many other institutional and organizational partners were pleasantly surprised at the steady stream of communication about issues with the 2024–25 form, even small ones, during this fall’s testing period.

Some major changes FSA implemented this past fall have stuck, from stronger contractor oversight to the new FAFSA director position. But right now, FSA’s future is murky at best. President Trump has proposed abolishing the Education Department entirely, a plan that would either relocate the agency to the Treasury Department or potentially farm its responsibilities out to nongovernmental organizations.

Jason Miller, former deputy director for management at the Office of Management and Budget, worked closely with FSA on the FAFSA overhaul over the past year. He told Inside Higher Ed that the agency was “in as strong a place as I’ve ever seen” when he left on Jan. 20, but he worries that the progress they made could be undone by the Trump administration’s plans to slash the federal workforce.

“We left the FSA with a new technical capacity to design and manage the [FAFSA],” he said. “The question is whether those in-house capabilities will be allowed to continue.”