Nearly $40 billion in new relief funds for students and colleges and universities is a step closer to becoming reality, after the Senate voted 50-49 on Saturday to approve President Biden’s $1.9 trillion coronavirus package. The House is expected to vote on final approval as early as Tuesday.
In a statement following the Senate vote, ACE President Ted Mitchell said that while the higher education funding in the bill “falls short of our most recent estimate of at least $97 billion in student and institutional needs, it still represents the largest federal effort so far to assist students and families struggling to cope with lost jobs or reduced wages and colleges and universities facing precipitous declines in revenues and soaring new expenses.” ACE and number of other higher education associations sent letters to the House and Senate expressing their appreciation for the assistance and supporting passage of the measure.
Colleges and universities will be required to spend approximately half of the funds in the bill on emergency grants to students.
The measure also provides additional dedicated support to Historically Black Colleges and Universities, Tribal Colleges and Universities, Hispanic-Serving Institutions, and other Minority-Serving Institutions to address the disproportionate effect of the pandemic on those institutions and their students, a “critical step in the effort to tackle historic funding inequities for these schools, a gap only exacerbated by the pandemic,” the associations wrote in their letter to the Senate.
The Senate approved several amendments to the House-approved version, including one that would exempt all student loan forgiveness from federal taxes for five years, in the event the president or Congress decides to cancel any debt.
One provision included in the House bill that made it into the Senate approved bill would amend the Department of Education’s so-called 90/10 rule, which requires institutions to get at least 10 percent of their revenue from sources other than the federal government, limiting the share they can get from student federal aid to no more than 90 percent.
The bill closes a loophole that does not categorize federal programs for active duty military and veterans’ education benefits as federal funding, though that change will not take place for two years. The higher education association community has long supported dealing with this loophole to ensure that the rule works as intended (see Inside Higher Ed for more information on this issue).