The financial impact of CARES on minority-serving institutions

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By Delece Smith-Barrow

Colleges and universities that primarily serve minority students may fare worse than others in receiving aid from the CARES Act, the government’s recent coronavirus stimulus package.

At the beginning of the month, colleges and universities were allotted $6 billion dollars to distribute to students as emergency grants. This money is meant to ease the cost of having to suddenly switch to remote learning. But on Tuesday, the department announced a caveat: the emergency grants are reserved for students who are eligible for federal financial aid. Historically black colleges, Hispanic-serving colleges and tribal colleges often serve students from the lowest-income populations, and they don’t always fill out the paperwork needed to prove eligibility for federal aid, such as the Pell grant.

“We know there are students, and they tend to more likely be low-income, first-gen and of color, that don’t apply for Pell and don’t fill out FAFSA,” said Deborah Santiago, cofounder and chief executive officer for Excelencia in Education, a nonprofit organization that helps Latino students pursue higher education. College students must fill out the Free Application for Federal Student Aid to receive federal aid for their education.

Plus, federal data won’t reflect recent changes in a student’s household income. If a parent lost a job in the last month and is one of the 22 million Americans who filed for unemployment insurance, that won’t be reflected on a FAFSA form filed months ago.

“Your income is not going to show that you are needy until next year, because you were middle income up until, you know, four weeks ago,” Santiago said.

The nation has 539 colleges and universities that meet the federal definition of a Hispanic-serving institution, or HSI, and most Latino college students attend an HIS, according to Excelencia in Education. About 50 percent of dependent Latino college students come from families making less than $40,000 per year and about 34 percent of independent Latino college students make $30,000 or less annually, according to a 2018 report from The Postsecondary National Policy Institute.

Many students at tribal colleges also have great financial need; 90 percent of entering tribal college students apply for aid, but often too late. Among new students who started in 2017 and 2018, 31 percent applied for financial assistance less than a month before classes began and 14 percent applied after classes had started. This week, the Andrew Mellon Foundation announced it was donating $4 million to the American Indian College Fund for tribal college and university students whose education was disrupted by the coronavirus pandemic.

Some HBCU advocacy organizations have launched emergency funds to help the institutions and the students they serve. The Thurgood Marshall College Foundation, which represents public historically black colleges and predominantly black institutions, recently launched the COVID-19 HBCU Emergency Fund to help students with unanticipated relocation costs, food, shelter and access to technology for online education. The United Negro College Fund, which represents 37 private historically black colleges and universities, has distributed more than $3 million to students for emergency aid and more than $4 million to institutions for general support. In 2019 there were 101 HBCUs.

“I’ve really been pleased with the interaction the Department [of Education] has given us,” said Lodriguez Murray, senior vice president of public policy and government affairs at the United Negro College Fund, which is also offering its members guidance on how to apply for and distribute federal aid. “Up to three times a week our schools are getting direct correspondence from me telling them what’s going on in Washington.”

Under CARES, more than $1 billion was set aside for minority-serving institutions, which may be needed more than ever after Tuesday’s announcement.

Many worry that the CARES Act will prevent students who really need money from receiving it. International students, on whom many HBCUs depend for increasing enrollment and bringing in tuition revenue, are not eligible for federal aid. Students without citizenship and those who are under the federal government’s Deferred Action for Childhood Arrivals policy are also left out of CARES.

Before the Department of Education’s announcement, many higher education policy experts encouraged colleges and universities to give emergency grants to whomever needed it. Now, the message has changed. They’re urging institutions to follow the Department ’s mandate that emergency grants be given only to students who are or could be eligible for aid under Title IV of the Higher Education Act. Title IV authorizes the federal student aid program.

“This is an evolving situation, and the practice on one campus might not be the same as a practice on another,” said Justin Draeger, president and CEO of the National Association of Student Financial Aid Administrators. “Students and families really need to check in with their own institutions to determine how the funds are being distributed and how the school is determining who qualifies for those funds, and recognize that the guidance from the Department of Education is still rolling out. And so for many schools they’re still trying to figure it out.”

How can colleges and universities ensure students most in need of financial aid will receive it? Is there anything else the federal government can do to help low-income students? Email or tweet me your thoughts.

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The financial impact of CARES on minority-serving institutions

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