Pandemic Series | An Overview of the Administrative Challenges with the Higher Education Emergency Relief Fund by Sarah T. Zipf

The COVID-19 pandemic has upended higher education. Most schools used remote teaching for the spring 2020 semester and are working to find a solution for the fall semester (Chronicle Staff, 2020). Current surveys show in-coming college students are uncertain about attending in the fall (Arts & Science Group, LLC, 2020) and college administrators are worried about the decrease in fall enrollment (Rhyneer, 2020). For at least one college, Urbana University, the pandemic was the final push in the decision to close the physical campus for good (Bamforth, 2020). The Higher Education Emergency Relief Fund (HEERF) included in the $2 Trillion CARES Act provides some fiscal relief to colleges and emergency financial aid to students. The administration of these grants has been challenging, especially as it relates to eligibility requirements and changing guidance. This provides a brief overview of what the HEERF currently looks like.[1]

Purpose

The purpose of the CARES Act HEERF is to give “funding to institutions to provide emergency financial aid grants to students whose lives have been disrupted, many of whom are facing financial challenges and struggling to make ends meet” (OPE, 2020). A total of $14 billion is expected to be paid out for the HEERF (Daugherty, 2020c). At least 50% of the funds received must go to students for emergency grants. The funds are to offset the expenses students will incur because of the coronavirus, such as course materials or technology (DeVos, 2020a).

The other 50% can be used at the discretion of the institution so long as the money is used for “costs associated with significant changes to the delivery of instruction due to the coronavirus” (CARES Act, Sec. 18004.3(c)(a)). It is not meant to be used for third-party recruiters or to pay for costs prior to the declaration of national emergency on March 13, 2020. Historically Black Colleges and Universities, Minority Serving Institutions, and Tribally Controlled Colleges Universities are encouraged to spend as much as possible on students but are not limited to the 50% in the same way as other colleges and universities (DeVos, 2020b). The emergency grants are not to put towards outstanding balances with the institution but given directly to students in the same way as excess federal financial aid is paid (HEERF FAQs, 2020). While these funds are not considered Title IV, or federal financial aid, for the purposes of institutional amounts, awarding, or reporting, institutional allocations used the number of Pell Grant recipients.

Calculation & Awarding

The allocations for each school were determined by calculating a ratio between Pell Grant recipients and undergraduate enrollment headcount. Data reported to IPEDS does not provide the exact numbers so approximations for full-time equivalency and Pell recipients was calculated (OPE, 2020). Students who were reportedly enrolled exclusively in distance education were excluded from the headcount. The allocations vary and range from several hundred dollars to over sixty million (OPE, 2020). While the calculations are based on Pell recipients, students outside of Pell eligibility may receive these funds at the discretion of the institution.

There is no clear definition for how institutions define which students have expenses related to the COVID-19 pandemic. Instead, the HEERF “provides institutions with significant discretion on how to award this emergency assistance to students” (DeVos, 2020a). This means the awarding process for these funds will look different depending on institutional decision-making and student populations. Some institutions are offering “block grants” or standardized awards to all students based on financial need while other institutions are requiring individuals to submit an application specific to their expenses (see Arcese, 2020). Eastern Michigan is offering funds to students to offset summer enrollment costs (Kelderman & McLean, 2020).

The amount given to each institution was based on the Pell recipients but the language of the HEERF does not stipulate students have to be Pell eligible or have demonstrated financial need. In fact, the initial certification and agreement form signed by institutions did not stipulate specific student eligibility. The Department of Education (ED) later clarified student eligibility which created confusion and concern about institutional accountability for awarding incorrectly. The ED has released several statements and guidance about student eligibility since the initial passing of the CARES Act which makes it hard to describe as a linear timeline. To date, there are no “safe harbor” clauses for auditing purposes (see Arcese, 2020) and additional guidance from the ED on May 21 indicates they cannot enforce the eligibility requirements (OPE, 2020). Yet, the mandated reporting seems as if it carries some sort of accountability with it. The purpose for this reporting is unclear. Guidance from the ED dated May 6, 2020 states institutions must publicly post the total amount of money received, awarding criteria and amounts, the number of students eligible for federal financial, and how many students receive these funds within 30 and 45 days respectively (OPE, 2020). There is no indication for how this collected information will be used. 

Unlike the awarding processes for federal financial aid programs, or Title IV funds that have clear awarding guidelines, the HEERF grants are not considered to be Title IV funds and awarding is at institutional discretion. Nevertheless, should schools be concerned about awarding these funds in such a way that creates reporting or auditing issues later? It seems as if additional funding may be coming. If so, then maybe some of these questions will be addressed.

Exclusions

As of the writing of this piece, opinions differ as to who is to receive these funds. The language of the act states that the funds will be disbursed in the same was as other federal financial aid resources. This means students will have to be making Satisfactory Academic Progress, have filed a FAFSA, be registered with the Selective Service, along with other and eligibility standards (see FSA, 2020). These eligibility requirements introduced confusion about the awarding criteria and has likely created delays in getting students this money (Murkami, 2020a).

There is strong disagreement about the eligibility and potential exclusion of Deferred Action for Childhood Arrivals (DACA) and international students. These students are not eligible to file for federal financial aid. The language of the CARES Act does not specify the eligibility criteria beyond federal financial aid eligibility but the HEERF was intended to support students during the pandemic, as awarded by the discretion of the institution. Unsurprisingly, the disagreement as to whether or not DACA students should be eligible for CARES Act funds falls along party lines. Republicans understand this to mean that DACA students are ineligible because they cannot get federal financial aid. Democrats claim that the language of the CARES Act HEERF does not specifically state DACA students should be excluded (Daughtery, 2020b; Murakami, 2020c).

The Higher Education Act of 1965 makes it clear that for students to receive emergency funding, they must be eligible for federal financial aid (see AskRegs, 2020). In her letter to HBCUs, MSIs, and TCCUs, Secretary DeVos specifically refers to the Higher Education Act (HEA), section 484, that defines eligibility for federal financial aid (DeVos, 2020b) including a filed FAFSA. It should be noted that the same language was not provided in previous cover letters dated April 9 and 21, 2020 respectively. The clarification from the ED about DACA students was released on April 21 and for many institutions, interrupted their in-progress decision making and awarding processes (HEERF FAQs, 2020; Murakami, 2020). The California Community Colleges filed a lawsuit on May 11, 2020 over the narrow eligibility requirements and exclusion of the many DACA students in their institutions (Feist, 2020).

The exclusion of online and distance education students is more clearly stated. The ED published a Frequently Asked Questions and states: “… the emergency financial aid grants to students are for expenses related to the disruption of campus operations due to coronavirus, and students who were enrolled exclusively in online programs would not have expenses related to the disruption of campus operations due to coronavirus (HEERF FAQs, 2020, p. 4-5).” The assumption that online students have not had their education disrupted is false. Adult students, the largest portion of online enrollments, are also going to be the ones who will carry the fiscal responsibilities and burdens for a family. The HEERF is meant to help students financially with expenses incurred because of the coronavirus. The modality of the education does not negate the financial strain. Like other students, online students’ physical campus closed. Online students are potentially without regular paychecks or without childcare, and are equally suffering issues related to living in a worldwide pandemic. The funding provided to institutions is meant to help students with expenses related to “health care, childcare, food” (DeVos, 2020a). These needs do not change with educational modality. Granted, the financial implications for online students may look different, it does not remove the hardship. It is a false assumption to state categorically that they had no expenses simply because of educational modality. The same modality that might arguably save higher education and students’ ability to progress to degree completion during this time, is being treated as a less valued form of higher education with this broad exclusion.

One eligibility check necessary for federal financial aid is to be in good standing with previous loans. For those students who may have defaulted or are in the process of rehabilitating loans, they will not be able to qualify for these emergency funds. The cohort default rate for 2016 is 10.1% (Press release, 2019) and for those students who re-enrolled are perhaps the very students who may need these emergency funds most. The CARES Act is meant to extend certain assistance to student loan borrowers. It appears that one practice, wage garnishment, has not yet stopped and at least one lawsuit has been filed (Murakami, 2020b). Fortunately, the loan repayment process had a more successful implementation and placed federal student loan borrowers into forbearance until September 2020 (FSA).

Betsy DeVos wrote in her letter on April 21, 2020, “to get support to those most in need as quickly as possible” and that “helping students remains our number one priority.” The inclusion criteria for this CARES Act created a narrow awarding practice and so far, has failed to stop wage garnishment. While it may be helpful to those students who receive it, the exclusions limit the total number of students who will benefit and potentially for those who may need it the most.

Next Steps

The purpose of these funds was to get the money to students as quickly as possible, but it remains unclear remains unclear as to how individual institutions have chosen to allocate these funds. For smaller schools, this money is more than their annual operating budget (McLean, 2020). Some institutions are starting to spend their funds (see Arcese, 2020) and others have not released details about their process (Murakami, 2020a). The ED’s guidance about reporting was released as this piece was being written. The initial reporting is required within 30 days, so information related to awarding and student eligibility will be available shortly. The reporting, however, only requires institutions to report the number of eligible students. What will remain unseen are those students who are not being served by the HEERF grants. At the very least, students who have not filed a FAFSA or who’s eligibility is still undetermined, online students, and DACA students will go unreported. Certainly, the reporting will be an important measure of how institutions decided to make the awards and hold institutions accountable. Nonetheless, this type of reporting limits our knowledge of the actual impact the coronavirus had on American college students because it captures those students who are eligible to receive the grant. The populations of students who are not eligible for Title IV funding, such as DACA, those who have not filed their FAFSA, and millions of online students, will go unreported. While the data about the HEERF awarding process will be telling, it falls short in describing the broad impact this pandemic actually had on college students.

There are still unknowns about the HEERF. For example, Harvard and Stanford, along with several other institutions with large endowments, stated they will not apply nor accept money from the HEERF (Barron, 2020; Stratford, Quilantan, & Perez, 2020). The money unused by institutions will go back into a pool and schools can compete for these additional funds (McLean, 2020). The details in this process are unclear. Will the same calculation based on Pell be used or will other factors play a role in the application process? Is it safe to assume that student eligibility requirements will remain the same for these additional funds? The HEERF grants are to be awarded to students within one-year (OPE, 2020) yet the reports indicate returning students are not filing their FAFSA for the next academic year (DeBaun, 2020). This means, without a change to eligibility, even fewer college students will be eligible to receive HEERF grants next year.

At first glance of the program, it seems to have a promise of helping college students who have been financially impacted by the COVID-19 pandemic. But looking a little deeper at eligibility and awarding creates doubt about fulfilling the promise of the program. The argument about student eligibility has gone to the courts (Feist, 2020). The ED stated additional guidance is still forthcoming (OPE, 2020). Future alterations to the program may leave schools scrambling to change current and in-progress processes. The purpose of these funds was to provide emergency financial relief to students yet the schools’ ability to do so has been hampered by the on-going interpretations and changes. The near future of higher education is unknown and the outcome to the HEERF funds should be added to this growing list. 

---

[1] Additional interpretation, guidance from the ED, and current lawsuits may change some of the points made in this post.

---

Sarah T. Zipf is a Ph.D. student in higher education at the Pennsylvania State University. Her research interests include non-traditional education, online education, financial aid, and educational equity. Sarah would like to give a special thank you to Colleen Coudriet and Nick Dikas for reading an earlier draft of this article.

References

Higher Education Emergency Relief Fund FAQs. (2020, April 21). U.S. Department of Education. Retrieved from: https://www2.ed.gov/about/offices/list/ope/heerfstudentfaqs.pdf

Arcese, A. (Producer)., (2020, May 5). Off the Cuff [Audio podcast]. Retrieved from: https://www.nasfaa.org/off_the_cuff_ep148.

Art & Science Group, LLC., (2020, April). Looking Ahead to Fall 2020: How COVID-19 Continues to Influence the Choice of College-Going Students. Art & Science Group, LLC. Retrieved from: https://www.artsci.com/studentpoll-covid-19-edition-2

AskRegs, (2020, April 15). AskRegs Update: Can Undocumented Students and International

Students Receive Funds Under the CARES Act?. NASFAA. Retrieved from: https://www.nasfaa.org/news-item/21573/Trending_AskRegs_Q_A_Can_Undocumented_Students_and_International_Students_Receive_Funds_Under_the_CARES_Act

Bamforth, E., (2020, April 21). Coronavirus pandemic closes Urbana University campus permanently. Cleveland.com. Retrieved from: https://www.cleveland.com/news/2020/04/coronavirus-pandemic-closes-urbana-university-campus-permanently.html

Barron, E., (2020, April 22). Stanford declines coronavirus money while other Bay Area schools to reap millions. The Mercury News. Retrieved from: https://www.mercurynews.com/2020/04/22/stanford-declines-coronavirus-money-while-other-bay-area-schools-to-reap-millions/

Chronicle Staff, (2020,  April 23). Here’s a List of Colleges’ Plans for Reopening in the Fall. The Chronicle of Higher Education. Retrieved from: https://www.chronicle.com/article/Here-s-a-List-of-Colleges-/248626?cid=RCPACKAGE

Coronavirus Aid, Relief, and Economic Security Act of 2020. Res 748, 116d Cong. https://www.congress.gov/116/bills/hr748/BILLS-116hr748enr.pdf (2020).

Daugherty, O., (2020a, April 21). ED Releases Further Guidance on Use of CARES Act Emergency Funding for Students, Institutions. NASFAA. Retrieved from: https://www.nasfaa.org/news-item/21646/ED_Releases_Further_Guidance_on_Use_of_CARES_Act_Emergency_Funding_for_Students_Institutions

Daugherty, O., (2020b, April 29). Democrats Question ED’s Title IV Eligibility Requirement for Emergency Aid. NASFAA. Retrieved from: https://www.nasfaa.org/news-item/21743/Democrats_Question_ED_s_Title_IV_Eligibility_Requirement_for_Emergency_Aid

Daugherty, O., (2020c, May 6). ED’s Internal Watchdog Releases Plan to Oversee Billions in COVID-19 Relief Funding. NASFAA. Retrieved from: https://www.nasfaa.org/news-item/21822/ED_s_Internal_Watchdog_Releases_Plan_to_Oversee_Billions_in_COVID-19_Relief_Funding

DeBaun, B., (2020, May 6). New Data: Nearly 250,000 Fewere Low-Income FAFSA Renewals This Cycle Nationally. National College Attainment Network. Retrieved from: https://www.ncan.org/news/505741/New-Data-Nearly-250000-Fewer-Low-Income-FAFSA-Renewals-This-Cycle-Nationally.htm

DeVos, B., (2020a, April 9). Cover letter. U.S. Department of Education. Retrieved from: https://www2.ed.gov/about/offices/list/ope/heerfinstitutionalcoverletter.pdf

DeVos, B., (2020b, April 30). Cover letter. U.S. Department of Education. Retrieved from: https://www2.ed.gov/about/offices/list/ope/coverletterhbcumsisiptccu.pdf

Federal Student Aid, (2020). Coronavirus and Forearance Info for Students, Borrowers, and Parents. U.S. Department of Education, Federal Student Aid. Retrieved from: https://studentaid.gov/announcements-events/coronavirus

Ferguson, H. (2020, May 28). ED Urges Courts to Toss out Challenge to Aid Distribution, Pledging Additional Guidance. Retrieved from: https://www.nasfaa.org/news-item/22074/ED_Urges_Court_to_Toss_out_Challenge_to_Aid_Distribution_Pledging_Additional_Guidance

Feist, P. (2020, May 12). California Community Colleges File Federal Lawsuit over Implementation of Emergency COVID-19 Student Assistance. Retrieved from: https://www.cccco.edu/About-Us/News-and-Media/Press-Releases/2020-DOE-LIT-PR

Kelderman &McLean, (2020, April 30). Eastern Michigan. The Chronicle of Higher Education. Retrieved from: https://www.chronicle.com/article/How-to-Get-Emergency/248679?cid=wcontentgrid_hp_4

McLean, D., (2020, May 5). I’m Bewildered’; For Tiny Colleges, Federal Covid-19 Stimulus Is a Windfall. The Chronicle of Higher Education. Retrieved from: https://www.chronicle.com/article/I-m-Bewildered-For/248707?cid=wcontentgrid_hp_2

Murakami, K., (2020a, April 30). DeVos Criticized on Emergency Grants. Inside Higher Ed. Retrieved from: https://www.insidehighered.com/news/2020/04/30/devos-criticized-excluding-more-daca-students-emergency-grants

Murakami, K., (2020b, May 1). Live Updates: Latest News on Coronavirus and Higher Education. Inside Higher Ed. Retrieved from: https://www.insidehighered.com/news/2020/05/07/live-updates-latest-news-coronavirus-and-higher-education

Murakami, K., (2020c, May 4). Does the Stimulus Package Really Exclude DACA Students?. Inside Higher Ed. Retrieved from: https://www.insidehighered.com/news/2020/05/04/devos-right-does-cares-act-exclude-daca-students-aid?utm_source=Inside+Higher+Ed&utm_campaign=52aa7ef09b-DNU_2019_COPY_02&utm_medium=email&utm_term=0_1fcbc04421-52aa7ef09b-234752689&mc_cid=52aa7ef09b&mc_eid=862053aca8

Office of Postsecondary Education, (2020). Higher Education Emergency Relief Fund. U.S. Department of Education. Retrieved from: https://www2.ed.gov/about/offices/list/ope/caresact.html

Higher Education Emergency Relief Fund Reporting- Emergency Financial Aid Grants to Students., (2020, May 6). U.S. Department of Education, Federal Student Aid. Retrieved from: https://ifap.ed.gov/electronic-announcements/050620HigherEdEmergencyReliefFundRptg

Press release, (2019, September 25). National Federal Student Loan Cohort Default Rate Continues to Decline. U.S. Department of Education. Retrieved from: https://www.ed.gov/news/press-releases/national-federal-student-loan-cohort-default-rate-continues-decline

Rhyneer, M., (2020 March 16). Survey results: How enrollment leaders are responding to COVID-19. EAB. Retrieved from: https://eab.com/insights/blogs/enrollment/how-enrollment-leaders-are-responding-to-covid19/

Stratford, M., Quilantan, B., & Perez, J., (2020, April 22). Elite colleges back away from rescue cash amid criticism of endowments. Politico. Retrieved from: https://www.politico.com/news/2020/04/22/devos-wealthy-colleges-coronavirus-aid-201375