The CARES Act contains several provisions related to education. The U.S. Education Department (USED) will receive $30.9 billion total, of which $30.75 billion will go directly to states, local school districts, and institutions of higher education “to help schools, students, teachers, and families with immediate needs related to coronavirus.” Those funds are as follows:

$3 billion for the “Governor’s Emergency Education Relief Fund” to make in additional grants to elementary and secondary education schools and institutions of higher education that have been most significantly impacted by coronavirus—with the goal of ensuring the ongoing functionality of schools and institutions. USED Secretary DeVos will invite governors to apply for funds not later than 30 days of enactment of the bill, and will approve (or deny) applications no later than 30 days after receipt. The money allocated to states is based on 60 percent of their relative population of individuals ages 5-24, and 40 percent of their relative number of children counted under section 1124(c) of the Elementary and Secondary Education Act (ESEA) (i.e., children ages 5-17 who are: below the poverty line; neglected, delinquent, or in foster homes; and, above the poverty line).

$13.5 billion in funding for the “Elementary and Secondary Education School Emergency Relief Fund” with 12 permissible, wide-ranging uses of those funds such as principal and school leader support, purchasing education technology (e.g., hardware, software, connectivity), continuing to employ existing staff, etc. Similar to the Governor’s Fund, USED Secretary DeVos will invite State Education Agencies to apply within 30 days of enactment of the bill. Of those funds allocated to states, not less than 90 percent will be directed to Local Education Agencies through the Title I, Part A formula of ESEA.

$14.25 billion in funding for the “Higher Education Emergency Relief Fund” to cover any costs associated with significant changes to the delivery of instruction due to the coronavirus, excluding payment to contractors for pre-enrollment recruitment activities, endowments, or capital outlays associated with facilities related to athletics, sectarian instruction, or religious worship. Not less than 90 percent of those funds will be directed to higher education institutions through the Title IV formula of the Higher Education Act and apportioned by 75 percent according to the relative share of full-time equivalent enrollment of Federal Pell Grant recipients (who are not exclusively enrolled in distance education courses prior to this emergency) and 25 percent according to the relative share of full-time equivalent enrollment of students who were not Federal Pell Grant recipients (who are not exclusively enrolled in distance education courses prior to the emergency).

There is additional funding directed to Project SERV ($100 million); Howard University ($13 million); Gallaudet University ($7 million); Student Aid Administration ($40 million); and the Office of the Inspector General ($7 million).

Other key education policy provisions include:

  • Requires the Secretary of Education to defer student loan payments, principal, and interest for 6 months without penalty;
  • Waives the institutional matching requirement for campus-based aid programs (e.g., GEAR UP);
  • Allows institutions to transfer unused work-study funds to be used for supplement grants;
  • Allows institutions to issue work-study payments to students who are unable to work due to work-place closures as a lump sum or in payments similar to paychecks;
  • Excludes the term from counting toward lifetime Pell eligibility for students who dropped out of school as a result of the coronavirus;
  • Provides the Secretary of Education with waiver authority to provide waivers from the Elementary and Secondary Education Act, except civil rights laws; and,
  • Requires the academic year to be counted towards TEACH grant obligations or Teacher Loan Forgiveness, if teachers could not finish the year of teaching service as a result of the coronavirus.

Read more about COVID-19’s impact on education on McGuireWoods Consulting’s website.