What You Need to Know About the COVID Relief Package for Higher Ed
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America’s schools are wounded, and Congress is finally doing something to slow the bleeding.
Acknowledging the catastrophic damage the COVID-19 pandemic has done to most higher education institutions (HEIs) in the nation, the U.S. government will be moving forward with a bill to help colleges and universities invest in their growth despite the registration declines through 2020.
How Much Money Is Higher Education Getting?
HEIs will see a total of $22.7B from the COVID stimulus package. This represents a significant bump from the $14B of CARES Act funding that was released following the first COVID shutdown in March 2020.
Of this, $20B will go to public and non-profit HEIs. Another $908M is going to for-profits, all of which must be used for student financial aid. Historically black colleges and universities (HBCUs), tribal colleges and other minority-serving HEIs are getting $1.7B. What’s more, $1.3B in federal capital loans to HBCUs have also been absolved.
How Can Schools Use This Money?
As with CARES $14B, at least half of the money given to each HEI must be spent on emergency aid for students. The other half can be used to keep delivering their programming, and keep their doors from closing.
How Will Schools Get Stimulus Money?
Though the specific distribution formula hasn’t been released yet, Congress appears to have addressed the problems they ran into with CARES Act funding distribution; namely the narrow focus on full-time enrollments (FTEs) that left less traditional institutions barely scraping by. In March of 2020, the more FTEs an institution served, the more money they got. If a school had high numbers of part-time or otherwise non-traditional students, they got less.
This time, the formula suggests a balance of both FTEs and headcount: HEIs will be recognized for the number of part-time learners they enroll, and will receive funding based solely on the size of their institution.
Why It Matters to You
Schools are in dire need of some slack right now, and the stimulus cuts them a moderate chunk. Many need to invest in restructuring their model of education, while others need the money to keep their faculty paid and their programming coming. Student populations are more at risk than ever due to heightened financial strain, so support is necessary to keep them engaged and enrolled.
Increased Access to Higher Education
Funds have been made available to reduce barriers to education access for non-traditional students. Though there are no details on how this money will be distributed, Congress has proposed $10B for child-care assistance, and $7B for broadband extension and access.
Tucked into the bill were some policy changes around the Free Application for Federal Student Aid (FAFSA) and Pell Grant reform, which will come into effect in 2023-24. They’ll create more access to education for lower-income and first-generation students, who generally don’t fit the traditional student mold.
As they’re often older, working, supporting dependents, or meet other factors that define non-traditional learners, Pell Grant eligibility will be streamlined for greater access and inclusivity, with access to education for incarcerated citizens being a Democratic priority.
It’s estimated 1.7M more students will qualify for the maximum Pell Grant funding, and hundreds of thousands more are expected to qualify for at least partial funding. Changes to the FAFSA form will also make it shorter and easier to fill out, cutting the document down to 36 questions from a hefty 108.
Why They Matter to You
Low-income and first-generation students suffer plenty of roadblocks as it is, and the pursuit of higher education is often an impossibility with the resources provided. The proposed changes position more learners to enroll at HEIs that would’ve once been out of reach, which means opens to floor to a wider prospect base and—fate willing—higher enrollments.
Help Where it's Needed Most
The proposed bill will undoubtedly help pull many schools up from under the water, offering many the opportunity to invest in assets that provide value to learners and resources to faculty that they’re hard-pressed for throughout these trying times.
Higher Education’s recession playbook is woefully outdated! To learn why, and to understand how your institution can modernize its recession response, download this white paper.
Last updated: February 1, 2021
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