Exempts family farms and small businesses from asset considerations in need analysis for federal student aid.
Tracey Mann
Representative
KS-1
The "Family Farm and Small Business Exemption Act" amends the Higher Education Act of 1965 to exclude the net value of a family farm (on which the family resides) or a small business (with no more than 100 employees and owned/controlled by the family) from consideration as an asset when determining financial need for federal student aid. This change aims to make higher education more accessible for students from family farm and small business backgrounds.
Family Farm and Small Business Owners Could Get More Financial Aid Under New Bill
The "Family Farm and Small Business Exemption Act" aims to make college more affordable for families running small businesses or farms. This bill, if passed, changes how the federal government calculates financial aid eligibility. Here's the breakdown:
FAFSA Fix: What's Changing?
Currently, the Free Application for Federal Student Aid (FAFSA) considers the value of a family's assets, including businesses and farms. This new bill excludes the net value of family farms and small businesses (with 100 or fewer employees) from those asset calculations. This change kicks in for award years starting after the bill's enactment. (SEC. 2.)
Real-World Impact: Who Benefits?
Imagine a family in Iowa running a mid-sized farm. Previously, the farm's value might have pushed them out of the range for significant financial aid. Under this bill, that farm's value won't count against their kid's aid application. The same goes for a family in Austin, Texas, with a small tech repair shop employing 10 people – their business assets are now off the table for FAFSA. This could mean more grants and loans for their college-bound children.
The Details: What Counts as a "Family Farm" or "Small Business"?
- Family Farm: The bill specifically mentions the family must reside on the farm. (SEC. 2.(B)) So, this isn't about absentee landlords; it's about working farms where the family lives.
- Small Business: It must be owned and controlled by the family, with no more than 100 full-time or full-time equivalent employees. (SEC. 2.(C))
Potential Challenges and the Bigger Picture
This bill is relatively straightforward, but it has some implications. It could make financial aid calculations simpler for families with these assets. The bill is all about making it easier for family farms and small businesses to send their children to college. It is important to note that the definition of a 'family farm' or 'small business' could be interpreted loosely, potentially leading to inconsistent application of the exemption.