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How The Department of Education Is Distributing Higher Ed Stimulus Funds

In March, colleges and universities across the United States halted in-person classes, directed students to move out of dormitories, and transitioned to a remote-learning model, due to the coronavirus pandemic. Epidemiologists encouraged the action, noting that dormitories, with communal living spaces and bathrooms, as well as dining halls with open buffets, force students into close quarters and increase the risk of infection. But COVID-19 related closures, while necessary to public health, pose a major risk to higher education revenue streams, with decline in enrollment, lost on-campus revenue, and weakened endowments are raising major concerns for school leaders. 

Many colleges or universities face an uncertain future as the coronavirus crisis shows no signs of waning. Administrators project that new college or university students grappling with the virus impact will be more likely to go to a school close to home, choose a less expensive school, take a gap year, or not go to college at all, according to the New York Times.

One higher education trade group predicted a 15% drop in enrollment, which would amount to a $23 billion revenue loss nationwide. Additional lost revenue will compound the problem, as sport seasons are canceled, room and board expenses go unpaid, study abroad programs and on-campus bookstores aren’t taken advantage of, and colleges and universities work to offer partial-refunds to students who weren’t able to adequately complete the spring semester. 

Related Blog: Next Steps Once Your Higher Ed Campus Becomes a Quarantine  Facility

Government intervention will be necessary to keep higher education afloat amid the crisis, and in late March, Congress’ emergency coronavirus stimulus bill alloted provided $14 billion to weather initial shutdowns and facilitate transitions to online learning. The funding might not be enough for long term financial stability in the higher education sector, but administrators should take a closer look at how the funds will be distributed to manage immediate impact. 

What Is In the Department of Education’s Higher Ed Stimulus Bill? 

The $2 trillion stimulus bill passed by Congress in March took specific action to help higher education, allocating $14 billion to help colleges and universities maintain academic continuity by moving classes online and begin to manage the economic fallout of the coronavirus crisis, as per Chronicle of Higher Education. The bill ensured funds would be sent to hard-hit institutions that serve majority low-income students, and separate funds would be allocated to historically black colleges and universities, as well as other minority-serving institutions or tribal colleges.

On Thursday, April 2, the Department of Education released further information about how the majority of the stimulus funds would be distributed across the higher education sector, according to Chronicle of Higher Ed. Half of each institution's grant money must be attributed to emergency student aid - and those $6.28 billions in funds were distributed immediately to colleges and universities.

The first wave of CARES funding is meant to provide cash grants to students with expenses related to the disruption of their education by COVID-19, including course materials or technology, food, housing, healthcare, and childcare, according to a press release. In order to access these funds, higher education institutions must submit a signed certification guaranteeing that funds will be distributed in accordance with the law to the Department of Education. 

Related Blog: Navigating A Major Disruption Caused By A Crisis: Advice From  Those Who Have Done It

Further clarification on how colleges and universities can send students emergency stimulus funds were published by the ED in late April. Under the guidance, students eligible to receive funds must be a citizen or a non-citizen that has other records such as a social-security number, a selective service registration, and a high school diploma or GED, information often made available to colleges through a FAFSA, as per Chronicle of Higher Ed. The new guidance may complicate distribution of funds for certain schools who were not aware of citizenship restrictions that prohibit funding for DACA students or may international students. 

The guidance contains several other restrictions as well, and it specifically does not permit students to use their cash grants to pay off their debts with the college. It also doesn’t allow colleges who distributed COVID-19 funds to students before March 27 to use the Cares Act funds to reimburse themselves. However, the second round of the bill’s funding, amounting to approximately $6.6 billion for helping colleges and universities with operating costs, will be more flexible and can be used for reimbursement. Colleges and universities must apply for the student cash grants before attempting to be in the different 

What Is The Future Of Higher Education Funding?

Future legislation might allot further funding for higher education, as college and university budgets are sure to face considerable strain over the next few years. Public and private research universities have collaborated with medical schools to request an extra $13 billion in funding, citing the critical role these institutions play in public health, as per the New York Times. The school said they need help paying faculty, post-doctoral students, and keeping laboratories open. Given the ongoing nature of the crisis, it seems likely that Congress will come to an additional agreement, but have yet to make any public notice as of yet. 

In the meantime, college and university administrators can use a mass notification system to communicate grant updates with faculty, students, and staff, as the coronavirus stimulus package is distributed. Students displaced by the virus might be anxious about both immediate financial struggles and their academic futures, and school leaders should communicate timelines to students as these changes occur.

Related Blog: Medical Students Are Graduating Early to Help With Coronavirus

Grants can be distributed to students to in the form of checks or as a direct-deposit to a checking account, according to the Department of Education. For any student having trouble accessing these funds or going through the process to receive funds, increasing awareness of financial aid office hours or contact informatoin can also facilitate the process. 

Higher education benefits from consolidating expenses and maximizing the value of resources and tools already in their budget. SMS Opt-In can also help colleges or universities expand the scope of their communications as well, and potentially bridge the gap in communications caused by closed campuses throughout the rest of the spring or fall. Prospective students, perhaps unable to visit the campus in person, can text a code to opt-in for further updates about their institution, including virtual college tours, changes to the application process, or updates about closings or openings.

Coronavirus Response Kit Higher Ed

Mary Kate McGrath
Mary Kate McGrath

Mary Kate is a content specialist and social media manager for the Rave Mobile Safety team. She writes about public safety for the state & local and education spheres.

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