Department of Education Sheds New Light on CRRSAA Funds

Last week, several Washington, DC-based higher education associations received guidance from the Department of Education on the use of CRRSAA HEERF II funds and clarification that students may use their emergency grant to pay for account balances before December 27, 2020, allowing them to continue their studies. 

The information the Department provided is a preview of the more comprehensive guidance expected in a few weeks. The Department shared these details because it knows the association’s members are facing pressing questions on their campuses.

Unfortunately, the Department continues to advise that using CRRSAA resources for expenses incurred before December 27, 2020 is not currently an allowable use of funds and will advise institutions of any change of interpretation.  That leaves two key questions that are under further legal review that the Department has still not answered:

• What date prior to December 27, 2020, can new allowable uses of funds and lost revenue be applied? We are pressing the Department to backdate allowable use of funds and lost revenue to prior to December 27.  
• Which students can receive emergency grants? 

It is our understanding that the Department is working on answers to these important questions, and will provide additional guidance soon. 

The question regarding lost revenue before December 27, is a critically important one.  Institutions are concerned that they cannot properly spend the institutional funds without clear guidance on lost revenue and expenses, at the same time they know covering this cost is desperately needed. NAICU and other higher education associations understand the congressional intent of the law to be that funding is provided to cover lost revenue and expenses due to the pandemic. This is what the higher education community advocated for in CRRSAA, and is now advocating for with the Biden Administration. However, the legal interpretation of quickly written legislation is tying the guidance up in knots.

The information the Department provided to associations last week says “Colleges can use HEERF II funds and unspent HEERF I funds to pay for employee benefits for costs incurred on or after December 27, 2020. However, the Department’s current guidance is that colleges cannot currently use HEERF II funds to cover costs prior to December 27th, or use HEERF I funds under the expanded use of funds flexibility offered under CRRSAA for expenses incurred prior to that date. The Department will update the HEERF community of any change in interpretation through future guidance documents.” 

With regard to student eligibility, the CRRSAA guidance does not require student recipients of emergency grants to be Title IV eligible, like the CARES Act guidance does. Because there was a disagreement between Congress and the Trump Administration about what the definition of an eligible student should be, the Trump Administration agreed to enact CRRSAA without a definition. This leaves the interpretation of student eligibility up to the agency administering the law. Department guidance says that student recipients should have “exceptional need,” but do not have to be Pell Grant-eligible, and that the institution can determine what that means. The current guidance also says students do not have to be Title IV-eligible, and could include those participating in non-credit courses, for example. However, guidance on whether or not international students or DACA students can receive emergency student grants has yet to be issued. The Departments of Education and Justice are working together to sort through legal opinions and determine how to address these students. 

NAICU is in regular communication with Department of Education officials about the concerns colleges have with the implementation of CRRSAA and the use of funds. The Department plans to release a FAQ document when its guidance is final.  

Excerpts from last week’s guidance follows:

Institutional Funds

• Institutions generally have one year to expend their HEERF funds from the date when the Department processed the most recent obligation of funds for each specific grant. That means colleges that received a supplemental award under CRRSAA have one year to spend all remaining HEERF I and new HEERF II funds for each grant. No Cost Extensions may also be granted under certain circumstances. Schools can contact their G5 grant program officer for more details on requesting an extension. 
• Colleges can use HEERF II funds and unspent HEERF I funds to pay for employee benefits for costs incurred on or after December 27, 2020. However, the Department’s current guidance is that colleges cannot currently use HEERF II funds to cover costs prior to December 27th, or use HEERF I funds under the expanded use of funds flexibility offered under CRRSAA for expenses incurred prior to that date. The Department will update the HEERF community of any change in interpretation through future guidance documents. 

Student Funds 

• Colleges can use HEERF II and unspent CARES funds to support certain students who are not Title IV eligible. That includes non-degree seeking, non-credit, dual enrollment, and continuing education students. The Department is exploring additional opportunities – including with other agencies - for colleges to support other vulnerable students (e.g., undocumented, DACA, and international students) during the national coronavirus pandemic emergency. As always, students have discretion about how they receive their grants and schools must receive affirmative consent from students before using an emergency financial aid grant to satisfy outstanding bills. 
• Schools may choose to make a financial aid grants to students who have left school for any reason during the period of the national emergency beginning on March 13, 2020. As always, students have discretion about how they receive their grants and schools must receive affirmative consent from students before using financial aid grants to satisfy a student’s outstanding account balance.
• Students may give institutions permission to apply the HEERF 2.0 funds to student account charges that were posted to the student’s account prior to December 27, 2020. While the charge was posted to a student’s account before December 27th providing the funds to students after December 27th is acceptable. As always, students have discretion about how they receive their grants and schools must receive affirmative consent from students before using financial aid grants to satisfy a student’s outstanding account balance bills. 
• Institutions may provide emergency financial aid grants directly to students using the normal process for providing a credit balances to students without obtaining a student’s consent, so long as these funds remain unencumbered by the institution. As always, students have discretion about how they receive their grants and schools must receive affirmative consent from students before using financial aid grants to satisfy a student’s outstanding account balance.  

For more information, please contact:
Stephanie Giesecke