May 7, 2020
Yesterday, the U.S. Department of Education (“Department”) released interim instructions to institutions that received emergency grant funds for students (“Emergency Student Grant Funds”) under the Higher Education Emergency Relief Fund (“HEERF”) of the CARES Act. The Certification and Agreement (“Certification”) that each institution executed as part of the application for HEERF funds requires frequent periodic reports on the use of the Emergency Student Grant Funds as directed by the Secretary of Education (“Secretary”). As detailed below, the new instructions, which mandate detailed public disclosures regarding the Emergency Student Grant Funds, modify and satisfy the reporting requirements outlined in the Certification until such time as the Department provides further instructions regarding reporting to the Secretary.
The Department’s new instructions direct each institution to post detailed information regarding the use of Emergency Student Grant Funds “on the institution’s primary website”. According to the instructions, the required information “must appear in a format and location that is easily accessible to the public.” And, in a modification from the requirement that an initial report be filed with the Secretary within 30 days after the date the institution executed the Certification, the new instructions obligate an institution to post the required information on its website within 30 days after receipt of its first allocation of Emergency Student Grant Funds, to be updated every 45 days thereafter.
The Department is requiring each institution to publish the following information:
- An acknowledgement that the institution signed and returned the Certification to the Department and an assurance that the institution will use no less than 50 percent of its total HEERF funds as Emergency Student Grant Funds.
- The total amount of funds that the institution will receive or has received from the Department in Emergency Student Grant Funds.
- The total amount of Emergency Student Grant Funds distributed to students as of the 30-day report (and every 45 days thereafter).
- The estimated total number of students at the institution eligible to receive Emergency Student Grant Funds.
- The total number of students who have received Emergency Student Grant Funds.
- The method(s) used by the institution to determine both which students would receive Emergency Student Grant Funds and how much they would receive.
- Any instructions, directions, or guidance provided by the institution to students concerning the Emergency Student Grant Funds.
Because this detailed website disclosure must be posted no later than 30 days from the institution’s receipt of Emergency Student Grant Funds, it is critical that the institution begin working on a plan to comply immediately. The Department notes that the posted information cannot include any personally identifiable information. The Department also advises that an institution should not report either the number of students in each category or the amount of Emergency Student Grant Funds available to students if the total number of eligible students, the total number of students who received Emergency Student Grant Funds, or the difference between those numbers is less than 10.
We noted in our April 13 Client Alert announcing the availability of the Emergency Student Grant Funds that “institutions should assume that their handling of these funds will receive ongoing scrutiny by other regulators, the media, and students.” Now that the Department is requiring detailed information regarding the disbursement of Emergency Student Grant Funds to be made publicly available in an easily accessible format, each institution should expect inquiries regarding its decisions and actions and should develop a plan for responding. We also urge every institution to ensure that it has a robust centralized plan in place to capture and retain all relevant records and documentation regarding its use of HEERF funds.
Maynard Cooper is a full-service firm with attorneys experienced in all regulatory and operational aspects of higher education, including federal and state oversight, accreditation, employee and benefits issues, and real estate concerns. We invite institutions to review the resources our attorneys have assembled to help our clients deal with the challenges created by the COVID-19 emergency.
Roger Swartzwelder advises regionally and nationally accredited institutions of higher education regarding legal, administrative, regulatory, and accreditation matters.
This Client Alert is for information purposes only and should not be construed as legal advice.
The information in this Client Alert is not intended to create and does not create an attorney-client relationship.