CARES Act HEERF – Access and Usage of Awarded Funds
In a previous post, I examined the allocation details of the Higher Education Emergency Relief Fund (HEERF), formally, Section 18004 of the CARES Act. This post overviews institutional application, disbursement, and use of HEERF awards, as described in documents released on April 21, 2020 by the Department of Education.
HEERF Allocation Calculations
The CARES HEERF, signed into law on March 27, 2020, provides recipient postsecondary institutions with two general categories of grant funding: direct aid to qualifying students (a “student aid” portion) and institutional cost reimbursement (an “institutional portion”). At least 50% of an institution’s award is required to be directed to the student aid category. The remainder offers more flexibility for institutional use, so long as funds are tied to expenses for changes in the delivery of instruction resulting from the coronavirus (U.S. Department of Education, 2020 June).
Award amounts were calculated by the U.S. Department of Education using a formula that heavily weighted non-distance Pell recipients. Institutions with large populations of in-person or partial distance students received the biggest awards, e.g., Arizona State University-Tempe received $63.5 million, with 46% of its students enrolled partial-distance. Comparatively, the mega-online institution Southern New Hampshire University enrolled nearly twice as many students as ASU-Tempe in 2018, but received $5.5 million in funds as 95% of its students were distance only.
Accessing and Usage of an Institution’s Allocation
To access their allocation, Department of Education requires an institution to submit an application via their Grants.gov online workspace environment. Separate certification and agreement forms must be completed for the student aid and institutional portions. Certification forms include detailed instructions on how the HEERF funds may be used and requirements for accepting the disbursement. For example, it is necessary for an institution to first certify and agree to funding for the student aid portion of funds before accessing institutional funds (U.S. Department of Education, 2020 April). Early on in the pandemic, the Department of Education prioritized the distribution student aid via institutions.
The institutional portion may be used “to cover costs associated with significant changes to the delivery of instruction due to the coronavirus”. Because a course delivery pivot is likely to include a broad technology solution, the documentation states it is permissible for an institution “to reimburse itself for costs related to…hardware, software, or internet connectivity that [the institution] may have purchased on behalf of students or provided to students” (U.S. Department of Education, 2020 April). This is not to say institutional aid may be freely spent. The funds must be used on a “reasoned basis” towards costs that have a “clear nexus to significant changes to the delivery of instruction due to the coronavirus” (U.S. Department of Education, 2020 April).
Time Limits and Reporting Requirements
In terms of expiry, it is unclear how long HEERF allocations remain eligible for application by an institution. Other time limits are clear. Reimbursed costs must have been incurred on or after March 13, 2020. Once funds are accepted, the institution “shall promptly and to the greatest extent practicable use the funds for Recipient’s Institutional Costs by one year from the date of this Certification and Agreement” (U.S. Department of Education, 2020 April).
Institutions are to prepare to report on the costs associated with use and demonstrate “such use was in accordance with Section 18004(c)”. The Department of Education notes that it will provide further instruction in the Federal Register. In the meantime, it encourages “institutions to keep detailed records of how they are expending all funds received under the HEERF” (U.S. Department of Education, 2020 May, p.3).
Ongoing Guidance Updates
With the approach of the fall and mounting preparation costs, questions on the proper use of funds is increasing. Guidance from the Department of Education has expanded, including FAQ guides and red-font update statements on their HEERF web page. But whether these provide clarity or just generate more questions for institutions remains uncertain. For example, on May 21, 2020, the Department of Education released updated statements about the legal limits of force and effect on its guidance documents (U.S. Department of Education, 2020 June). This seems to have muddied the waters on the recommendations versus requirement institutions must follow. Institutions will need to add navigating HEERF funding to its list of coronavirus challenges in the year ahead.
DeVos, B. (2020, April 21). Letter from the Secretary: CARES Act grant funding cover letter. Retrived June 15, 2020 from https://www2.ed.gov/about/offices/list/ope/heerfinstitutionalcoverletter.pdf.
U.S. Department of Education (2020. April). CARES HEERF Certification and Agreement. Retrieved June 15, 2020, from https://www2.ed.gov/about/offices/list/ope/heerfInstitutionalcertificationagreement42020v2.pdf.
U.S. Department of Education (2020. May). Frequently Asked Questions about the Institutional Portion of the Higher Education Emergency Relief Fund under Section 18004(a)(1) and 18004(c) of the Coronavirus Aid, Relief, and Economic Security (CARES) Act. Retrieved June 15, 2020 from https://www2.ed.gov/about/offices/list/ope/heerfinstitutionalfaqs.pdf.
U.S. Department of Education (2020, June 11). CARES Act: Higher Education Emergency Relief Fund. Retrieved June 15, 2020, from https://www2.ed.gov/about/offices/list/ope/caresact.html.