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Congress Gave Colleges A $14 Billion Lifeline. Here's Where It's Going

Ryan Johnson for NPR

College dorms are closed. Athletic events are canceled. Classes have moved online. Like so many sectors of the U.S. economy, higher education is taking a hit from the coronavirus pandemic. In March, Congress set aside more than $14 billion to help colleges and universities weather the outbreak. Here's where most of that money has gone and why many colleges are holding out for more:

The coronavirus rescue package, known as the CARES Act, created three buckets of funding for higher education: $12.5 billion to help with coronavirus-related expenses for schools that participate in federal financial aid; $1 billion for minority-serving institutions, including historically black colleges and universities; and a smaller pot of nearly $350 million for colleges that didn't get much from those first two buckets and still had "significant unmet needs."

The largest bucket — that $12.5 billion — was designed to be the main vehicle for getting funds directly to colleges and students. The U.S. Department of Education allocated this money to colleges using a formula that favors institutions serving full-time, low-income students. According to the department, it has distributed more than $10 billion to colleges so far. The CARES Act says schools have to give at least half of that money — more than $6 billion — directly to students whose lives have been disrupted by the pandemic and are having trouble making ends meet.

Schools are required to publicly report what they've done with the money. But there isn't much guidance on what these emergency grants for students should look like, and it's up to schools to figure out how to distribute the funds.

"The fact is, to give somebody emergency aid is actually pretty difficult," Sara Goldrick-Rab, a professor of higher education and sociology at Temple University, told Inside Higher Ed. That may be why some universities have yet to begin the process of handing the money out. Eastern Michigan University, which was allotted nearly $14 million in federal aid, said that as of mid-May it still hadn't distributed any money to students because it was working on plans to do so. The law allows institutions one year to give out the money, and EMU plans to have a program in place by late summer or early fall, according to a statement.

And there's another wrinkle: Three weeks after the CARES Act was signed into law, the Education Departmentissued guidance that said only students who are eligible for federal student aid programs can qualify for these emergency grants. That means, according to the department, international students and undocumented students — including those who are protected under the Deferred Action for Childhood Arrivals program — are not eligible for any emergency aid.

In a statement to NPR, the department said this was how Congress wrote the law: "There is no persuasive legal support for the proposition that Congress intended the CARES Act to create an entitlement for DACA recipients and others who are otherwise ineligible for Federal public benefits."

Democratic lawmakers have expressed concern about the guidance and the impact it will have on immigrant students. And at least one college system says the new guidance is illegal: Earlier this month, California Community Colleges filed a federal lawsuit against Education Secretary Betsy DeVos, calling the aid restrictions "arbitrary" and "unlawful."

From the beginning, higher ed leaders have said the $14 billion lawmakers set aside in the CARES Act wouldn't be enough to save the country's colleges and universities. The American Council on Education, a higher education lobbying group, has called the money "woefully inadequate" and said schools would need about$46.6 billion more.

On Friday, House lawmakers passed a Democratic proposal that would put about $37 billion more toward higher education. Most of that money would go to governors to distribute to public colleges, and about $10 billion would go to schools with pandemic-related needs. The money is part of the $3 trillion HEROES Act, which Senate Republicans have already said they won't support.

Copyright 2021 NPR. To see more, visit https://www.npr.org.

Elissa Nadworny
Elissa Nadworny reports on all things college for NPR, following big stories like unprecedented enrollment declines, college affordability, the student debt crisis and workforce training. During the 2020-2021 academic year, she traveled to dozens of campuses to document what it was like to reopen during the coronavirus pandemic. Her work has won several awards including a 2020 Gracie Award for a story about student parents in college, a 2018 James Beard Award for a story about the Chinese-American population in the Mississippi Delta and a 2017 Edward R. Murrow Award for excellence in innovation.