CSU has some thing called TAG which provides grants for those showing financial need. There isn’t enough there for all who qualify by FAFSa EFC so they ask for additional information. They figure that those students with noncustodial parents who can afford to pay are better off than those who do not have that possible resource.
Schools can come up with just about any additional requirements and information remittance in giving out their own money. My state, NY, has TAP which has state money available for NY state kids needing financial aid. It has restrictions and requirements that FAFSA does not address. So what CSU is not way off in that requirement. Hopefully your D did get some aid from TAG.
Bear in mind, as mentioned, that your D will likely show a reduction in need when her college sibling is out of school. That can double the EFC.