Washington Watch: Biden signs $1.9T stimulus legislation

President Joe Biden (Photo courtesy of the White House)

President Joe Biden on Thursday signed the $1.9 trillion American Rescue Plan (ARP) Act, which builds on both the CARES Act and CRRSAA and will provide even more financial assistance to community colleges and their students.

From the institutional perspective, a primary benefit of ARP — which the House passed earlier this week — is that it closely tracks CRRSAA (the Coronavirus Response and Relief Supplemental Appropriations Act). So, with some important exceptions, what applies to CRRSAA will also apply to the Rescue Plan. This should facilitate institutional planning, even as colleges await further guidance on key aspects of CRRSAA. (See this week’s AACC/ACCT webinar on CRRSAA implementation.)

Enhanced support for community colleges

The Rescue Plan allocates $39.6 billion for the Higher Education Emergency Relief Fund, compared to $22.7 billion under CRRSAA. Given that ARP generally uses the same program structure, this means that colleges will receive a proportional increase — about 75% more than they received under CRRSAA. This applies to Title III and Title V funding as well as the basic formula grant program. (CRRSAA allocations under these titles have been made public, though many colleges have not yet received notice.) 

The U.S. Education Department will almost certainly slate ARP funds to be spent as under CRRSAA, though the funding rollout may take at least a few weeks, given that the former law has yet to be fully implemented. AACC (the American Association of Community Colleges) remains in close contact with administration officials to ensure that policies and processes accommodate member colleges to the maximum possible extent, within the law’s strictures.

Planning is critical

Some things for institutional leaders to consider as they develop plans for the substantial resources Congress is providing them to respond to the pandemic:

Which students most need support? 50% of ARP formula funds must go to students. (In dollar amounts, this works out to be at least 85% of the total formula grants under CRRSAA for both students and institutions.)  Students with exceptional need are to be prioritized, but ED has not yet indicated how that may be done. Students are not required to undergo a formal Title IV needs assessment, though federal student aid recipients will surely receive substantial funding, as Congress intends. But the pandemic has also presented non-Title IV recipients with many challenging financial and related circumstances. Colleges will likely want to take this into account. 

Which new types of students and programs should be funded? In its guidance to AACC, ED has also stated that non-credit, non-degree and dual-enrollment students can receive CRRSAA funds, in contrast to the federal aid programs. Therefore, colleges will have the flexibility to allocate funds to students in very different circumstances. Many community colleges have long looked for federal support for these students, and now they will have an opportunity – albeit a time-limited one – to do so.

What institutional expenditures are related to the pandemic and can be supported by the new laws? The law says that institutional funds can help “defray expenses related to the coronavirus.” A wide array of college activities might fall into this category, including a swath of instructional programs and support, as well as services offered to students and faculty. New programs may well qualify for support if they can tie directly to the pandemic. Furthermore, the time that institutional personnel have had to devote to addressing pandemic-related needs may qualify for support in the payroll category.

How can my college receive support for lost revenues? Like CRRSAA, the new law allows colleges to use institutional funds to cover lost revenues. ED has not yet provided relevant guidance in this area, and while the basic concept is clear and colleges are already envisioning, or even calculating, certain year-to-year or term-to-term amounts, for the moment it is proving challenging to fully move forward in this area.  

How should my college pace expenditures? Under CRRSAA, colleges have one year to spend funds — a point of confusion on many campuses, in large part because of misleading communications from ED — with the possibility of an extension; and Rescue Plan Act funds may come with the same proviso. (ARP makes these funds available through September 30, 2023.) In other words, colleges may have almost two and a half years to allocate all formula funds. While the course of the pandemic and its campus impact remain unpredictable, Congress is clearly anticipating that its effect may be felt for some time. 

Also of note is an ARP requirement that all colleges receiving funding conduct direct outreach to financial aid applicants about the opportunity to receive a financial aid adjustment due to the recent unemployment of a family member or independent student, or other circumstances, described in section 479A of the Higher Education Act. This is more commonly known as “professional judgment.” ED will provide more information in this area, but institutions should know of the mandate now.

AACC will keep institutions informed about the latest developments in implementing both CRRSAA and the newly enacted Rescue Plan Act.  

About the Author

David Baime
is senior vice president for government relations and policy analysis at the American Association of Community Colleges.