June 24, 2022

Ten things you need to know about the $39.6 billion in new funding for higher education aid

On May 11, the US Department of Education released its advice how emergency funds for higher education institutions will be spent, providing instructions to thousands of colleges and universities for permitted uses of the money.

This funding, which when fully allocated will total $39.6 billion, is included in the American Rescue Plan Act of 2021 (ARP) (Pub. L. 117-2), signed by President Joe Biden in March. The money represents the third tranche of funding from the Higher Education Emergency Relief Fund (HEERF) to help prevent, prepare for and respond to the coronavirus pandemic.

Taken together, three pieces of legislation, the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) (Pub. L. 116–136), the Coronavirus Response and Relief Supplemental Appropriations Act, 2021 (CRRSAA) (Pub. L. 116 -260), and the ARP, have now allocated approximately $77 billion to US colleges and universities.

I. Who gets what?

The new HEERF funds will be allocated as follows:

  • Approximately $36 billion for public and private not-for-profit, two-year and four-year institutions. At least half of an institution’s allocation must be used for student emergency financial assistance grants. The rest can be used for various institutional purposes.
  • Approximately $3 billion for Historically Black Colleges and Universities (HBCUs), Tribal Control Colleges and Universities (TCCUs), Minority Serving Institutions (MSI), and Institutional Strengthening Program (SIP) institutions. An announcement regarding the availability of these funds is forthcoming.
  • Approximately $198 million for institutions that the Department says have, after allocating other available funds, the greatest unmet needs related to the coronavirus.
  • About $396 million to for-profit institutions that can only be used for student emergency financial aid grants.

II. How many establishments are affected?

According to the department, the grants will go to more than 5,000 institutions of higher learning, including HBCUs, TCCUs and HSIs.

III. What are the distributions to individual institutions?

Inside Higher Education has a searchable database which shows allocations to individual institutions, as well as portions to be spent on student financial aid and institutional purposes.

IV. How were the institutional amounts determined?

Institutional allocations are based on a formula that includes relative shares of federal Pell grant recipients (based on headcount and full-time equivalent), relative shares of non-Pell grant recipients, and relative shares exclusively enrolled PELL recipients. in distance education before the coronavirus emergency.

V. Which students are eligible for financial aid from these funds?

One of the most significant changes in the current allocation is the easing of restrictions on the types of students eligible to receive aid. Basically, any student who was enrolled in a higher education institution during the national Covid-19 emergency is eligible for emergency financial aid grants.

Institutions are required to give priority to students with exceptional needsuch as students who receive Pell grants or who are undergraduate students with extraordinary financial circumstances (for example, losing their job or experiencing food or housing insecurity).

VI. Can undocumented students and international students receive funding?

Yes. The Department’s final rule authorizes grants to citizens, permanent residents, refugees, asylum seekers, undocumented and international students, students studying abroad, and those attending college under the Deferred Action for Childhood Arrivalsor DACA, policy.

VII. What can students use their financial aid for?

Emergency financial aid scholarships can be used by students for any element of their tuition or for coronavirus-related emergency costs, such as tuition, food, housing, medical care, etc. health (including mental health care) or child care. Institutions cannot direct or control how students use their emergency financial aid grants.

VIII. How can the institutional part of the funds be used?

As with previous tranches of relief funding, institutions can use the institutional portion to cover expenses associated with the coronavirus (including loss of income, reimbursement of expenses already incurred, technology costs associated with a transition to teaching distance education, faculty and staff training and payroll); and they can award additional emergency financial aid scholarships to students.

The Department strongly encourages institutions to reduce student debt or outstanding tuition balances by paying off the full debt balance as lost revenue and then repaying themselves through their institutional grants. or by providing additional emergency financial grants to students (with their permission).

IX. Are there any new requirements for spending the institutional portion of the funds?

The ARP has added two new mandatory uses of the institutional portion for public and private nonprofit institutions, which must allocate a portion of their institutional funds to:

(a) implement evidence-based practices to monitor and suppress coronavirus in accordance with public health guidelines; and

(b) directly educate financial aid applicants about the possibility of receiving a financial aid adjustment due to the recent unemployment of a family member or independent student, or other circumstances.

X. What are examples of allowable expenses for coronavirus surveillance and suppression?

Here are some examples :

  • establish a diagnostic or screening test strategy, such as setting up a testing site, purchasing tests, or hiring additional staff to administer the tests.
  • hire staff to support contact tracing efforts in collaboration with local public health authorities.
  • set up vaccination sites on or off campus to deliver the vaccine to students, faculty, and staff.
  • provide masks and other personal protective equipment (PPE) to students, faculty and staff.
  • supporting clean and sanitary campus environments, including purchasing hand sanitizers and hand-washing stations placed throughout campus.
  • pay time off or grant sick leave to staff to get vaccinated.
  • procure additional on-campus or off-campus space to house students and support other costs associated with meeting the basic needs of students in isolation and quarantine.
  • provide academic support and mental health services to students in isolation or quarantine.