The State of Higher Education Spending From the CARES Act
The State of Higher Education Spending From the CARES Act
While students have received most of the emergency funds set aside for them, institutions must spend down funds from other sources.
Last month, Congress delivered another $23 billion in relief to help higher education institutions respond to the COVID-19 pandemic. As the U.S. Department of Education doles out the second round of relief, new data show how much remains of the $14 billion in funding that colleges received from the Coronavirus Aid, Relief, and Economic Security (CARES) Act passed in March 2020. Congress awarded that money in three main pots: 90 percent ($12.6 billion) for institutions, about half of which must be spent on emergency grant aid to students; 7.5 percent ($1 billion) for minority-serving institutions; and 2.5 percent ($349 million) for a formula grant program aimed to help public and nonprofit institutions that received little aid from the other pots.
As of late November 2020, institutions had applied for and received $13 billion of the $14 billion. Nearly $847 million remains unawarded. Of the $13 billion that institutions received, three-quarters of the funds—or nearly $10 billion—have been spent. Colleges have spent an even larger share of the funds required to go toward students: 92 percent has already been spent, with $463 million remaining.
This column takes a closer look at the state of CARES Act spending from the Higher Education Emergency Relief Fund (HEERF) in the CARES Act, as of November 30, 2020. It also includes a downloadable spreadsheet with data at the institutional and state level.
State of overall spending
In November, the Education Department released an online portal and downloadable data that track spending of funds provided for education in the CARES Act. Due to reporting errors, the Center for American Progress excluded 96 institutions from this analysis.
Among the institutions CAP analyzed, 2,011, or 44 percent of colleges, spent all of their funding, while very few colleges—1.5 percent—spent less than 10 percent of their funds. The three pots of HEERF money together represent a total of eight different funds reported by the department at the institutional level, but these more detailed data can only be exported by state, not by institution. Therefore, some colleges with low levels of overall spending may still have spent all or most of their student funds. It is important to note that the Education Department allocated HEERF funds directly to 4,698 institutions, not to states. However, due to limitations in the institutional-level data, this column analyzes detailed data that are available and aggregated to the state level for the individual funds. The department plans to continuously update these data.
As mentioned above, of the $13 billion that institutions applied for and received, almost $10 billion, or 75 percent, has been spent. With the exception of Hawaii, institutions in every state and the District of Columbia have spent nearly 60 percent of the total funds awarded to colleges in that state. Institutions in Hawaii have only spent 40 percent of total allocated funds.
State of spending by individual funds
The total HEERF award is further broken out into eight individual funds. Table 1 includes the amount awarded and spent from each funding source. It is not clear why some institutions are not spending down their allocated funds, and this is a topic worthy of examination since the funds are intended to help students and colleges weather the urgent challenges of the pandemic.
Funds for all institutions
The Education Department awarded the following funds to Title IV institutions in all states and the District of Columbia.
- Student portion: The CARES Act required institutions to distribute about half of the HEERF funds to students in the form of emergency grant aid. Institutions that were awarded funds in 40 states and the District of Columbia have spent at least 90 percent of these funds. Institutions in Arizona have spent the lowest—69 percent.
- Institutional portion: Nearly two-thirds, or 65 percent, of institutional funds have been spent. Institutions in 36 states and the District of Columbia have spent at least 60 percent of these funds. Institutions in Hawaii have spent less than a third—31 percent—of their allocated funds.
Funds awarded to specific types of institutions
The CARES Act provided the following funds to specific institution types in addition to the institutional funds that colleges of all types received. Some institutions may have received funds under more than one of the categories below. Spending under these funds is much lower than under student and institutional funds, which may be because colleges are spending down those funds first.
- Historically Black colleges and universities (HBCUs): Compared with other minority-serving institutions, HBCUs received the largest pot of funding, of which more than one-third—36 percent—has been spent. Institutions in 20 states and the District of Columbia received funding from this pot. Institutions in Pennsylvania and Delaware have spent all their allocated dollars. However, institutions in the District of Columbia and California have not yet spent any of their HBCU funds.
- Tribally controlled colleges and universities (TCCUs): Funds to TCCUs represent the smallest pot out of all eight funding sources. Of these dollars, 44 percent have been used. Institutions in 13 states received TCCU dollars, with institutions in Oklahoma having spent 100 percent of their funds, while institutions in Washington have not yet spent any of their allocated TCCU dollars.
- Minority-serving institutions (MSIs): Slightly more than one-third—34 percent—of funds to other MSIs have been spent. Institutions in 36 states and the District of Columbia received MSI dollars, with institutions in Michigan and the District of Columbia having spent 100 percent of their allocated funds. Institutions in Montana and Idaho have not yet spent any of their MSI funding.
- Strengthening Institutions Program (SIP): SIP funds are for institutions that do not meet the eligibility to be an MSI but have at least 50 percent of their students receiving need-based assistance. Nearly half—48 percent—of these funds have been spent. Institutions in 48 states received SIP funds, with institutions in Wyoming, Nevada, and Connecticut having spent more than 90 percent of their funds. Institutions in Alaska and Idaho have not spent any of their SIP dollars.
- Fund for the Improvement of Postsecondary Education (FIPSE): FIPSE is a formula grant program aimed to ensure that all public and nonprofit institutions receive at least $500,000 in relief. About half—48 percent—of these funds have been spent. Institutions in 49 states and the District of Columbia received FIPSE funds. Institutions in South Carolina, Mississippi, Idaho, and Hawaii have spent 100 percent of their dollars. However, institutions in Rhode Island, Delaware, and Alaska have not spent any of their FIPSE funds.
As noted earlier, at the institutional level, data on the eight individual funds cannot be exported but are available for researchers, students, and policymakers to examine specific colleges of interest to them. Additionally, Integrated Postsecondary Education Data System (IPEDS) or Office of Postsecondary Education Identification (OPEID) numbers for institutions cannot be exported, making it impossible to analyze HEERF funds spent across various institutional characteristics—for example, sector, institutional category, size, and so on. Lastly, the online portal only permits single-state downloads; it would be helpful if the Education Department allowed for data from multiple states to be pulled in one export.
The good news is that institutions have spent three-quarters of the HEERF funds they applied for and received. Institutions must spend down the remaining 25 percent—or $3 billion dollars—of funds and prioritize funds for students who need the most support in order to give them the best possible shot at successfully finishing college.
While the department has recently made available $21 billion from HEERF II, these dollars are significantly less than the $120 billion colleges indicated they need to offset the costs of the pandemic. The new Congress and the administration of President Joe Biden have an opportunity to provide more support for colleges and their students in order to help minimize the damage that the pandemic will have on educational attainment and opportunity in this nation.
Marshall Anthony Jr. is a senior policy analyst for Postsecondary Education at the Center for American Progress. Marissa Navarro is a research assistant for Postsecondary Education at the Center.
To find the latest CAP resources on the coronavirus, visit our coronavirus resource page.
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Marshall Anthony Jr.
Associate Director, Policy and Advocacy
Marissa Alayna Navarro
Former Research Assistant