Ed Dept gives colleges more flexibility to use federal relief funds

by Joseph K. Clark

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Dive Insight:


Former President Donald Trump signed the Coronavirus Response and Relief Supplemental Appropriations Act in late December, making roughly $23 billion in postsecondary education aid available.

This followed $14 billion in the first round of higher education relief. Higher ed groups have said at least $120 billion is necessary to help the sector address the pandemic’s financial impact.

The Trump administration limited the second funding wave to costs incurred beginning in late December. But the Education Department’s guidance released Friday states that institutions can use the money for lost revenue or expenses that date far back as March 13, 2020, when Trump declared a national emergency over the spreading coronavirus.

The agency also released an FAQ Friday describing what constitutes “lost revenue” and how colleges can calculate that amount. In that document, the department “strongly” recommended colleges devote the maximum amount of aid possible to emergency grants for students who have been disadvantaged by the pandemic. The department’s directive makes clear colleges can use the funds to eliminate students’ debt to institutions.

Colleges must use some of their aid from the three bills on student grants. At least half of the funds in the first and third bills need to be passed on to students.

The FAQ notes colleges have flexibility in how they calculate lost revenue. For example, they could use a year-over-year comparison or a semester-over-semester comparison using the same semester in the prior year.

The department also said Friday that colleges can directly reach out to students who qualify for the Supplemental Nutrition Assistance Program under newly expanded but temporary criteria. SNAP eligibility now includes students who are allowed to participate in state or federally financed work study during a typical academic year, as well as those who have an expected family contribution of zero this year. EFC is the former index used to calculate students’ federal financial aid awards.

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