Little Apple Times

Last week, the House Education and Workforce Committee passed H.R. 1250, the Family Farm and Small Business Exemption Act, as part of H.R. 6951, the College Cost Reduction Act. This legislation, led by Representatives Tracey Mann and Jimmy Panetta, aims to restore certain exemptions for family farms and small businesses under the Free Application for Federal Student Aid (FAFSA).

Representative Mann highlighted the importance of supporting family farms and small businesses, stating, "Family farms and small businesses exemplify the American dream. When young people from these families are applying for higher education financial aid, the assets tied up in the family farm or small business should not count against them." He emphasized the need to restore the FAFSA exemptions, which were standard for over 30 years, before a new analysis goes into effect in the summer.

Similarly, Representative Panetta stressed the need to prevent unfair penalties for students from family farms and small businesses when applying for federal student aid. He stated, "The advancement of our bipartisan Family Farm and Small Business Exemption Act through committee is an important step forward in fixing the Free Application for Federal Student Aid to reflect the realities and limited financial resources that family farmers and small business owners often face."

The proposed changes to the FAFSA, known as the FAFSA Simplification Act, would require families to report the net worth of their family farm or small business, which would then be included in the calculation of the Student Aid Index (SAI). This could result in the loss of financial aid eligibility for students from families that own small businesses or family farms. The current formula, in place since 1992, excludes the net worth of family farms and small businesses as assets.

The Family Farm and Small Business Exemption Act seeks to restore the exclusion of the net worth of family farms and small businesses from assets in the calculation of the SAI. By doing so, the legislation aims to ensure that the federal government expands academic opportunities for entrepreneurial families, rather than limiting them.

Overall, the advancement of H.R. 1250 in the House Education and Workforce Committee is a positive step toward addressing the financial challenges faced by students from family farms and small businesses. The legislation aims to restore exemptions that were once standard practice and ensure that the next generation is treated fairly. The bill now awaits further consideration on the House Floor.