The year 1967 was a year of contrasts. We witnessed campus demonstrations, growing enrollments, racial rioting, and the appointment of the first black Supreme Court Justice. Financial aid as a profession had taken a giant step forward with passage of the Higher Education Act of 1965—a major component of the "Great Society" envisioned by Lyndon B. Johnson. This Act created the Supplemental Education Opportunity Grant, College Work-Study and Guaranteed Student Loan Programs, an unprecedented package of student assistance to add to the earlier G. I. benefits and National Defense Student Loan Legislation. Colleges and universities, overwhelmed with these new benefits and the confusing array of federal rules and regulations attached, had begun to upgrade associations, with the mutual support and training opportunities they offered, were taking on new urgency and importance.

In November 1967, a group of Iowa financial aid directors found a quiet corner at the MASFAA conference in Bloomington, Indiana, and talked about the need for a state organization. Everyone agreed that Iowa would benefit from a state level association.

Acting on this informal consensus, John Moore of the University of Iowa convened a meeting of some 30 financial aid people in Des Moines on May 14, 1968. A Steering Committee was appointed to draft a constitution and by-laws and to schedule an organizational meeting. Jim Lenguardoro of Wartburg College chaired the Steering Committee which included: Dennis Jensen of the University of Northern Iowa, Don Culbertson of Iowa Central Community College, Ed Jackson of Marshalltown Community College, Nick Ryan of Grinnell College, Willis Ann Wolff of the Iowa Higher Education Facilities Commission, and (by acclamation) John Moore.

The organization meeting was called for August 2, 1968, at the Savery Hotel in Des Moines. Forty Charter members attended. They adopted a constitution and by-laws and elected their first slate of officers.

Politically tuned in from the outset, the IASFAA charter members voted to send over-night letters to all the Iowa Congressional representatives urging prompt action on the student aid bill then under consideration. This bit of political action cost a total of $23.50 and, since the IASFAA Treasury existed in name only, the Executive Director of the Iowa Higher Education Facilities Commission (HEFC; now the Iowa College Student Aid Commission), Dr. W. L. Roy Wellbourne, floated a no-interest loan to cover this initial expenditure.