U.S. Department of Education Makes Available CARES Act Funds for Institutions of Higher Education

On April 21, 2020, the Department made available the institutional portion of the Higher Education Emergency Relief Fund (HEERF) under Section 18004(a)(1) and 18004(c) of the Coronavirus Aid, Relief, and Economic Security (CARES) Act.

By statute, the institutional HEERF funds are to be used to cover any costs associated with significant changes to the delivery of instruction due to the coronavirus so long as such costs do not include payment to contractors for the provision of pre-enrollment recruitment activities, including marketing and advertising; endowments; or capital outlays associated with facilities related to athletics, sectarian instruction, or religious worship.

Through an associated FAQ, the Department has provided further guidance and limitations on use of the institutional HEERF funds:

  • An institution must enter into the Funding Certification and Agreement with the U.S. Department of Education to receive and distribute Emergency Financial Aid Grants to Students in order to be eligible to receive the institutional HEERF portion of the funds. In other words, institutions cannot select only to receive the institutional, but not student, portion of the HEERF funds provided by Congress.
  • Institutions that have provided refunds to students for room and board, tuition, and other fees (such as activities fees) may use the institutional HEERF funds to reimburse themselves, so long as the institution can demonstrate that such costs were incurred as a result of significant changes to the delivery of instruction, including interruptions in instruction, due to coronavirus. Institutions will need to be able to document how those reimbursements are related to the COVID-19 interruption. 
  • Institutions may reimburse themselves for refunds previously made to students on or after March 13, 2020, but only if they can demonstrate that such refunds were necessitated by significant changes to the delivery of instruction, including interruptions in instruction, due to coronavirus.
  • Institutions may use institutional HEERF funds for costs incurred by the institution to purchase laptops, hotspots, or other IT equipment and software necessary to enable students to participate in distance learning as a result of the coronavirus interruption.
  • Institutions that purchased computers or other equipment to donate or provide to students on or after March 13, 2020 may reimburse themselves for those costs, again if tied to need arising from the coronavirus interruption.
  • The institutional HEERF funds can be used to make additional emergency financial aid grants to students (to supplement the student HEERF funds), provided that such grants are for expenses related to the disruption of campus operations due to coronavirus (including eligible expenses under a student’s cost of attendance, such as food, housing, course materials, technology, health care, and child care). Only students who are or could be eligible to participate in programs under Section 484 in Title IV of the Higher Education Act of 1965, as amended (HEA), may receive emergency financial aid grants.
  • At institutions that provide both online and ground-based education, students who were enrolled exclusively in online programs on March 13, 2020 are not eligible for emergency financial aid grants, as the Department’s position is that students who were enrolled exclusively in online programs would not have expenses related to the disruption of campus operations due to coronavirus. Fully 100% online institutions were already ineligible for HEERF funding.
  • Institutional HEERF funds may be used to award scholarships or to provide payment for future academic terms only if the institution can demonstrate that such grants are needed for expenses related to the disruption of campus operations due to coronavirus. If provided to students in the form of emergency financial aid,  such uses are allowable.
  • Institutional HEERF funds can be used to pay a per-student fee to a third-party service provider, including an Online Program Manager (OPM), for each additional student using the distance learning platform, learning management system, online resources, or other support services; however, institutions may not use institutional HEERF funds to pay third-party recruiters or OPMs for recruiting or enrolling new students at the institution.
  • The Funding and Certification Agreement that institutions must sign also makes clear that institutional HEERF funds cannot be used for: senior administrator and/or executive salaries, benefits, bonuses, contracts, incentives; stock buybacks, shareholder dividends, capital distributions, and stock options; and any other cash or other benefit for a senior administrator or executive.

More information on CARES Act grant resources and guidance can be found on the Office of Postsecondary Education’s webpage: https://www2.ed.gov/about/offices/list/ope/caresact.html

 

 

U.S. Department of Education Delivering $6 Billion in Student Emergency Grants via Institutions

On April 9, 2020, the Secretary of Education announced the availability of more than $6 billion for immediate distributed to colleges and universities to provide direct emergency cash grants to college students through the authority of the Higher Education Emergency Relief Fund authorized by the Coronavirus Aid, Relief, and Economic Security (CARES) Act. The CARES Act provides nearly $14 billion to support postsecondary education students and institutions. Colleges and universities are required to utilize the $6.28 billion made available today to provide cash grants to students for expenses related to disruptions to their educations due to the COVID-19 outbreak, including things like course materials and technology as well as food, housing, health care, and childcare. In order to access the funds, the Department must receive a signed certification from the higher education institution affirming they will distribute the funds in accordance with applicable law. The college or university will then determine which students will receive the cash grants.

School allocations are set by formula prescribed in the CARES Act that is weighted significantly by the number of full-time students who are Pell-eligible but also takes into consideration the total population of the school and the number of students who were not enrolled full-time online before the coronavirus outbreak. The Department is utilizing the most recent data available from the Integrated Postsecondary Education Data System (IPEDS) and Federal Student Aid (FSA) for this calculation.

Institutions will receive allocations and guidance for the institutional share of the Higher Education Emergency Relief Fund in the coming weeks. Institutions will be able to use these funds to cover costs associated with significant changes to the delivery of instruction due to the coronavirus.

Additional information on institution-level funding for students, including data tables, can be found here. The Secretary’s letter to college and university presidents with additional information on this funding allocation can be found here.

https://www.ed.gov/news/press-releases/secretary-devos-rapidly-delivers-more-6-billion-emergency-cash-grants-college-students-impacted-coronavirus-outbreak

U.S. Department of Education Posts Updated COVID-19 Guidance for Institutions Following Enactment of CARES Act

Late on Friday, April 3, the Department posted updated guidance for institutions that recognizes the regulatory flexibilities authorized by Congress in the CARES Act, but also addresses other areas including Clery Act,  Distance Education, Foreign Schools and FERPA, among other issues relevant to the COVID-19 interruption. The guidance is effective through June 30, 2020 unless otherwise extended by the Department. The Higher Education Relief Fund portion of CARES ACT is not addressed and will be the subject of future guidance.

ELECTRONIC ANNOUNCEMENTS

– April 03, 2020
(OPE Announcements) Subject: UPDATED Guidance for interruptions of study related to Coronavirus (COVID-19)
https://ifap.ed.gov/electronic-announcements/040320UPDATEDGuidanceInterruptStudyRelCOVID19

Higher Education Institution and Student Relief in the CARES Act

The CARES Act appropriates $30.75 billion for an Education Stabilization Fund available through September 30, 2021, to assist governors and postsecondary institutions with preventing, preparing for and responding to COVID-19. The Act also includes important student relief and temporary regulatory flexibilities.

To read the full text of this Duane Morris Alert, please visit the firm website.

Department of Education Issues Guidance on Safeguarding Civil Rights During COVID-19 Pandemic

As with all crises, this pandemic is a rapidly evolving situation that is forcing schools to quickly implement new policies and practices, often operating on limited information and without the usual procedural safeguards and vetting. Such an environment creates a risk of the unintended consequences of those new policies/procedures resulting in potentially discriminatory effects to students.

Recognizing this risk, the Department of Education’s Office for Civil Rights published guidance on March 16, 2020, reminding schools that students’ civil rights must be safeguarded during responses to the COVID-19 pandemic. OCR’s guidance encourages schools to take measures to protect against COVID-19, but to do so in a manner that is free from discrimination and continues to accommodate people with disabilities.

To read the full text of this Duane Morris Alert, please visit the firm website.

Department of Education Issues Guidance on Safeguarding Civil Rights During COVID-19 Pandemic

As with all crises, this pandemic is a rapidly evolving situation that is forcing schools to quickly implement new policies and practices, often operating on limited information and without the usual procedural safeguards and vetting. Such an environment creates a risk of the unintended consequences of those new policies/procedures being overlooked, resulting in potentially discriminatory effects to students.

Recognizing this risk, the Department of Education’s Office for Civil Rights published guidance on March 16, 2020, reminding schools that students’ civil rights must be safeguarded during responses to the COVID-19 pandemic. OCR’s guidance encourages schools to take measures to protect against COVID-19, but to do so in a manner that is free from discrimination and continues to accommodate people with disabilities.

The Department of Education focused on a few key areas as examples of potential pitfalls: Continue reading “Department of Education Issues Guidance on Safeguarding Civil Rights During COVID-19 Pandemic”

U.S. Department of Education Issues COVID-19 Guidance to Schools

Due to the outbreak of coronavirus (COVID-19), the Centers for Disease Control and Prevention recommends that institutions of higher education consider postponing or canceling upcoming study abroad or foreign exchange programs. However, this advice has raised pressing questions about how this would affect Title IV, Higher Education Act (HEA) federal financial aid and a student’s ability to finish the term if a program is interrupted or canceled. In response, on March 5, 2020, the U.S. Department of Education’s office of Federal Student Aid (FSA) offered guidance permitting temporary flexibility and clarifying how higher education institutions can continue to comply with Title IV regulations for students whose activities are impacted by COVID-19.

To read the full text of this Duane Morris Alert, please visit the firm website.

U.S. Department of Education Issues COVID-19 Guidance

Due to the outbreak of coronavirus (COVID-19), the Centers for Disease Control and Prevention recommends that institutions of higher education consider postponing or canceling upcoming study abroad or foreign exchange programs. However, this advice has raised pressing questions about how this would affect Title IV, Higher Education Act (HEA) federal financial aid and a student’s ability to finish the term if a program is interrupted or canceled. In response, on March 5, 2020, the U.S. Department of Education’s office of Federal Student Aid (FSA) offered guidance permitting temporary flexibility and clarifying how higher education institutions can continue to comply with Title IV regulations for students whose activities are impacted by COVID-19.

View the full Alert on the Duane Morris LLP website.