Schools in the Federal Work-Study program have to meet two separate federal work-study community service requirements each award year: spend at least 7% of their FWS allocation on wages for students in community service jobs, and place at least one student as a reading tutor for young children or in a family literacy project.1eCFR. 34 CFR 675.18 – Use of Funds The rules bind the institution, not the student, but they decide which jobs end up on a campus work-study listing and where federal dollars have to go.
The 7% Spending Floor
The 7% is calculated on the combined initial and supplemental FWS allocation for the award year, and it covers only the federal share of wages, not the employer match or fringe benefits.1eCFR. 34 CFR 675.18 – Use of Funds A school receiving $500,000 in total FWS funds has to put at least $35,000 toward community service payroll.
Supplemental funds carry a steeper rule. If a school receives a supplemental FWS allocation, 100% of that supplemental money must go to community service positions, on top of the base 7% obligation rather than folded into it.2Federal Student Aid. 2025-2026 Federal Student Aid Handbook – Volume 6 – Chapter 2 – The Federal Work-Study Program
One historical boundary matters for anyone looking at older guidance. The Department of Education waived both the 7% requirement and the literacy mandate for award years 2019–20 through 2023–24. Those waivers expired. Both rules are fully in force for the current and future award years.2Federal Student Aid. 2025-2026 Federal Student Aid Handbook – Volume 6 – Chapter 2 – The Federal Work-Study Program
The Reading Tutoring or Family Literacy Placement
Independent of the 7% spending floor, every participating school has to maintain at least one student placement in either a reading tutoring project or a family literacy project. A reading tutor must work with children who are preschool age or in elementary school. A family literacy placement must engage students in activities that support literacy for both parents and their children.1eCFR. 34 CFR 675.18 – Use of Funds One or the other satisfies the rule; many schools do both.
This is a standalone obligation. A school can spend well above 7% on other community service categories and still fall out of compliance if it has no reading tutors and no family literacy workers. Treat it as a separate compliance item rather than something covered by the general community service budget.
Not every after-school program qualifies as a family literacy project. Federal law requires the program to integrate interactive literacy activities between parents and children, training for parents to serve as their children’s primary educators, parent literacy training aimed at economic self-sufficiency, and age-appropriate education preparing children for school.3Legal Information Institute. Definition: Family Literacy Services A loose homework club will not satisfy the mandate.
What Counts as Community Service
The regulations define community service as work identified by the school, in consultation with local nonprofit and government organizations, as designed to improve the quality of life for community residents or address specific needs, with a focus on low-income populations.4eCFR. 34 CFR 675.2 – Definitions Recognized categories include:
- Health care and child care, including campus child care centers open to the surrounding community
- Education and literacy work beyond the mandatory reading tutor placement
- Social services and welfare roles in food banks, housing agencies, and welfare organizations
- Public safety, including crime prevention and emergency preparedness
- Housing and neighborhood improvement with housing authorities or revitalization groups
- Services for people with disabilities, including students enrolled at the institution
- Mentoring for tutoring, recreational, or career counseling purposes
- Rural development and transportation work in underserved areas
The consultation requirement is not a formality. The school has to actually talk with local organizations to identify community needs rather than assigning students wherever is convenient. The consultation can be formal or informal, but it has to happen.4eCFR. 34 CFR 675.2 – Definitions
Civic education projects form a subset. These must teach civics in schools, raise public awareness of government functions and resources, or increase civic participation, and the regulations direct schools to prioritize, to the extent practicable, projects that educate the public about evacuation procedures, emergency response, and injury prevention related to natural disasters, terrorism, or other emergencies.5eCFR. 34 CFR Part 675 – Federal Work-Study Programs Students in these roles need appropriate training before they start.
One point of confusion worth clearing up: there is no federal requirement to place work-study students as math tutors. The math tutor rule is a funding incentive, not a mandate.
Who Can Host These Jobs
FWS students can work for the institution itself, a federal, state, or local public agency, a private nonprofit, or a private for-profit company.6eCFR. 34 CFR 675.20 – Eligible Employers For-profit placements can be legitimate FWS jobs when the work is academically relevant to the student’s program, but those wages do not count toward the 7% community service floor, because the definition of community service ties eligible activities to consultation with nonprofit, governmental, and community-based organizations.4eCFR. 34 CFR 675.2 – Definitions
Off-campus work with public agencies or nonprofits has to serve the public interest. Political campaigning, election-related activity, and lobbying at any level of government are out. Positions cannot involve constructing, operating, or maintaining space used for religious worship or sectarian instruction, and tutors in the program may not use religious materials.7Federal Student Aid. 2022-2023 Federal Student Aid Handbook – Volume 6 – Chapter 2 – The Federal Work-Study Program Work-study students also cannot displace regular employees; the role has to expand what the organization does rather than fill a gap left by a laid-off worker.
Every off-campus placement needs a written agreement between the school and the employer, whether or not the school is the employer of record. That agreement spells out working conditions, supervision, and which party handles hiring, firing, and payroll. For private nonprofits, the school must verify incorporation as a nonprofit under federal or state law.7Federal Student Aid. 2022-2023 Federal Student Aid Handbook – Volume 6 – Chapter 2 – The Federal Work-Study Program
How the Federal Share Works for Community Service Jobs
The federal government does not cover the full cost of every community service paycheck. The share depends on who employs the student and what the student does:
- Standard community service and on-campus jobs: federal share up to 75%, employer pays the rest.
- For-profit employers: federal share drops to 50%.
- Qualifying nonprofits or public agencies that cannot afford the match: federal share can reach 90%, but only if the organization is unaffiliated with the school, is selected case by case, and the students in these roles make up no more than 10% of the school’s total work-study headcount.
- Reading tutors, family literacy workers, math tutors (grades K–9), and civic education roles: federal share can be 100%, with no employer match required.8eCFR. 34 CFR 675.26 – Federal Share of FWS Compensation
These percentages cover the student’s gross wages only. Employer-side costs such as Social Security contributions, workers’ compensation, and any retirement or insurance benefits always stay with the employer and cannot be charged against the federal allocation.5eCFR. 34 CFR Part 675 – Federal Work-Study Programs The 100% federal share on literacy, math tutoring, and civic education roles is why schools often use those placements to stretch limited community service budgets.
Hardship Waivers
A school that genuinely cannot meet either the 7% spending requirement or the literacy placement mandate can request a waiver from the Secretary of Education. The standard is that enforcing the requirement would cause a hardship for the school’s students.1eCFR. 34 CFR 675.18 – Use of Funds A waiver applies only to the award year for which it is requested, so schools have to reapply each year they need relief.
Waiver requests go through the Common Origination and Disbursement website on an annual deadline. For the 2026–27 award year, requests were due by 11:59 p.m. Eastern time on April 20, 2026. Late requests are not considered.9Federal Student Aid. 2026-27 Federal Work-Study Program Community Service Waiver Requests Check the Federal Student Aid announcements each spring for the current year’s deadline.
Reporting and What a Shortfall Costs
Schools document community service spending through the Fiscal Operations Report and Application to Participate, the FISAP. The annual filing reports the previous award year’s expenditure data and serves as the application for the next cycle’s funding, with a filing deadline typically in early October.10Federal Student Aid. 2026-2027 FISAP Reporting 2024-2025 Expenditure Data and Requesting Funds for 2026-2027 FISAP Deadline The Department of Education uses the community service figures in the FISAP to verify compliance.
A school that falls short of the 7% threshold without a waiver must return the difference between what it should have spent and what it actually spent.2Federal Student Aid. 2025-2026 Federal Student Aid Handbook – Volume 6 – Chapter 2 – The Federal Work-Study Program A school that owed $35,000 and spent $20,000 sends back $15,000. That is the floor.
Noncompliance can also trigger a Limitation, Suspension, and Termination proceeding that could strip the school’s ability to participate in FWS and potentially other federal student aid programs.2Federal Student Aid. 2025-2026 Federal Student Aid Handbook – Volume 6 – Chapter 2 – The Federal Work-Study Program The Department may impose fines of up to $67,544 per violation, with the amount set by the severity of the offense and the size of the institution.11Federal Student Aid. 2024-2025 Federal Student Aid Handbook – Volume 2 – Chapter 8 – Program Reviews, Sanctions, and Closeout That per-violation figure adjusts annually for inflation, so confirm the current amount before relying on it.