Washington Watch: A new round of relief funds, plus updated ED guidance

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The U.S. Education Department (ED) on Tuesday released most of the third installment of the Higher Education Emergency Relief Fund (HEERF) provided through the American Rescue Plan (ARP) Act.

Community colleges will receive more than one-third ($12.68 billion, or 34%) of the $36 billion in formula grants. The department will soon make available ARP funding for Title III and V institutions. Generally, colleges are to apply the new funds similarly to how they were used under the CRRSAA law, with a few significant changes. 

Including undocumented students

The department included a new final rule regarding HEERF emergency financial aid grants eligibility along with the announcement of the new ARP funds. Among the key highlights: Undocumented students may receive the grants, which is very good news for community colleges. The rule defines a student as “any individual who is or was enrolled at an eligible institution on or after the date the national emergency [March 13, 2020] was declared for COVID-19 may qualify for assistance under HEERF [Higher Education Emergency Relief Fund] program requirements.”

The Trump administration interpreted the intent of Congress in enacting the CARES Act to limit grants only to Title IV-eligible students and issued an Interim Final Rule (IFR) to that effect. However, the previous administration did not apply the IFR to funds distributed through CRRSAA, opening the door for students in non-credit programs and others, but not for undocumented and international students.

Coinciding with ED’s allocation of student funds under ARP, the final rule changes course and clearly states that all students enrolled on or after March 13, 2020 are eligible for grants. The rule applies to all HEERF funds, including unspent CARES and CRRSAA funds. The final rule, responding to comments received on the IFR and subsequent litigation, is based on a new interpretation of congressional intent and statutory construction. ED now interprets the CARES statute to have intended that all students are eligible to receive grants, and that CARES supersedes a prior law that was interpreted to render undocumented and international students ineligible.

New Q&A guidance

The new guidance, in a Q&A form, elaborates on the ARP requirement that colleges must use a portion of the funds to:

  • Implement evidence-based practices to monitor and suppress coronavirus following public health guidelines (with examples).
  • 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.

The guidance doesn’t specify exact amounts, but colleges must use a “reasonable and necessary” portion of the funds for these activities.

The new material also provides context for how colleges are to assign priority for student financial grants. ARP (and CRRSAA before that) states that priority must go to students with exceptional need, with an emphasis on Pell Grant recipients.

The new guidance makes clear what would constitute violation of this standard:

  • Establishing a minimum GPA.
  • Imposing other academic or athletic performance or a good-standing requirement.
  • Requiring continued enrollment in the institution or requiring students to pay any outstanding debt or balance that results in failure to prioritize students with exceptional need.

Colleges appear to retain flexibility in awarding grants outside of these parameters, although colleges will need to clearly document their processes for awarding grants. They don’t have to use Title IV-needs analysis to distribute the grants.

Related article: Kudos for their use of federal relief funds

The guidance says that HEERF grant funds can help pay for any new staff or repurposed staff if the new or repurposed staff’s work is associated with Covid (e.g., contact tracers, IT staff, additional medical personnel, teaching assistants, offering smaller class sizes to support social distancing, etc.). Colleges may also use HEERF funds to “pay the salaries (from March 13, 2020 onward) of staff who were unable to work during a period of any full or partial campus closures due to the pandemic (e.g., cafeteria workers, maintenance staff, bookstore clerks, etc.).”

While generally prohibiting construction or renovation, the guidance does allow minor remodeling related to the pandemic, including new or improved HVAC systems. The guidance also details how colleges can use HEERF funds to discharge outstanding student balances. This may be done with student grant funds with the student’s permission, or with institutional funds, in which case the outstanding balances are treated as lost revenue.

Length of use of funds

Community colleges have sought clarification on exactly how long they have to use HEERF funds. The new guidance provides that. As was the case previously, colleges initially have one year, starting on the date they receive their ARP allocations, to spend all remaining HEERF funds, with the possibility of a no-cost extension.

As to the extensions, the guidance states that “The Department understands that some grantees, even given the emergency nature of the HEERF grant, may be unable to expend funds by this time. Consequently, no-cost extensions (NCEs) of up to 12 months are available.  Given the emergency nature of HEERF grants, the Department encourages grantees to use their awards to cover expenses associated with the coronavirus as they arise and not hold off on doing so. The Department does not intend an NCE to extend longer than 12 months, but the Department intends to be very flexible in offering an initial NCE.” 

This language will likely be very relevant for many community colleges.

Webinar next Monday

The American Association of Community Colleges and the Association of Community College Trustees will sponsor a May 17 webinar on the new HEERF funds. Michelle Asha Cooper, ED’s acting assistant secretary for postsecondary education, will participate.

About the Author

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