Months Later, Stimulus Grants Come for College Students in Fits and Starts

The U.S. Department of Education encouraged colleges to release emergency aid to students quickly after a federal stimulus package passed in late March. But confusion over student eligibility requirements and logistical oversights have stalled the process in many cases.

June 19, 2020
 
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Esosa Ruffin, a senior political science student at Monmouth University in West Long Branch, N.J., was interning at the Council for Opportunity in Education when Congress passed the CARES Act, a federal stimulus package, in late March in response to the coronavirus pandemic.

She knew emergency aid would soon be on its way to college students nationwide, including those at Monmouth. In May, Ruffin graduated, and the university notified some students that grants were available.

“When I heard that students at Monmouth were getting an email, I was like, ‘OK, this is good, they’re getting the money out to students,’” Ruffin said. “But I thought it was odd that I hadn’t received an email.”

Ruffin said she is a low-income student, and her tuition, fees and room and board had been paid for through a combination of a Pell Grant, loans and other financial aid earlier in the year. The system Monmouth first used to distribute emergency grants excluded students without unmet financial need, defined as the direct cost of attendance minus the student's family's expected financial contribution, grants, scholarships, subsidized loans, federal work-study and graduate assistantship financial aid awards. Ruffin was among the excluded students, along with more than 250 other Pell-eligible students.

Ruffin and a group of concerned students and alumni brought this problem to the university, and Monmouth responded. As of June 10, the university had distributed more than 2,800 grants to 2,196 undergraduate students and 629 graduate students, said Morganne Dudzinski, a university spokesperson. Ruffin was notified June 3 that she would receive an $800 grant.

The grant issue, which left hundreds of low-income students in emergency aid limbo, is just one example of how colleges and universities have scrambled to distribute CARES Act-funded grants on the fly amid what critics say is a lack of clear, consistent guidelines from the federal government. Meanwhile, students’ rent, groceries and internet bills demand to be paid.

A poll by the National Association of Student Financial Aid Administrators revealed that nearly three-quarters of institutions hadn’t disbursed CARES Act emergency grants by May. With little federal guidance, colleges were scrambling to develop individual disbursement processes, said Justin Draeger, president and CEO of NASFAA.

“These grants were appropriated in March and were meant to go to students quickly. Even the secretary [of education] herself urged schools to get these monies out as quickly as possible,” Draeger said. “The problem was by mid-April, five weeks later, the department started introducing student eligibility criteria that caused most schools to slam on the brakes.”

The new eligibility criteria threw a wrench into colleges’ brand-new disbursement processes. Some colleges had to overhaul their plans to adhere to the new guidance, Draeger said. All the while, students, many of whom did not receive their own stimulus checks because they are claimed as dependents on their parents' tax forms, waited for emergency assistance.

“By the time we got to May, the term is ending, students were clearly already in crisis and were facing emergency expenses, and by May most schools had not disbursed funds primarily because they were confused about who was eligible and who wasn’t,” Draeger said.

In recent weeks, colleges have provided more CARES Act money to students. NASFAA re-polled institutions in June, finding that 94 percent had disbursed emergency grants to students. Of those institutions, more than half had spent 75 percent or more of the funds allocated by the federal government for student grants.

Some colleges are tied up in legal battles over the Department of Education’s student eligibility requirements, which exclude from receiving CARES Act emergency grants undocumented students, international students and other students who are typically ineligible for federal financial aid.

Wednesday, District Judge Yvonne Gonzalez Rodgers granted a preliminary injunction in a case brought by the California Community Colleges, allowing the colleges to distribute emergency funds at their discretion, without regard for the Department of Education’s requirements.

A similar ruling was issued by a federal judge in Washington State, temporarily allowing institutions there to give emergency grants to veteran students on the GI Bill, students with bad grades, those who have defaulted on loans and other students who are otherwise ineligible for federal financial aid. The ruling did not, however, include undocumented students.

The Department of Education has already said it will appeal both rulings.

Any idea that guidance on disbursing grants was unclear is "simply untrue," a spokesperson for the department said in an email.

"The Department has been clear and consistent since the CARES Act was passed: Congress tied this funding to Title IV eligibility," the spokesperson said. "We issued guidance very shortly after the CARES Act was passed so that schools could start issuing emergency grants to students the way Congress intended. Because guidance is not legally binding, we also published an interim final rule that carries the force of law. It’s important to note that nothing precludes schools from making emergency grants to their undocumented students, they simply cannot use federal taxpayer dollars in order to do so."

Even without legal uncertainty, some universities are still holding on to the CARES Act funding. Arizona State University received $63.5 million under the stimulus package -- the largest allocation of any college in the country. Of that, $31.8 million must be spent on student emergency grants.

The university said it has not yet finalized a mechanism for disbursing the funds and that it will send out the grants during the summer and fall.

“Our goal with that funding is to support students first and foremost in continuing their academic studies,” an ASU spokesperson said in an email.

Draeger noted that institutions have quite a bit of time to disburse the funds.

“Congressional and federal guidance was pretty clear that schools should work to get the money out as soon as possible, despite the fact that it was federal guidance that created significant delays,” he said. “That said, the certification agreement from the Department of Education gave institutions one year to disburse those funds.”

In the meantime, ASU has disbursed $1 million in private grants to 1,400 students who “need immediate help,” the spokesperson said. This equates to less than 2 percent of the student population.

When asked if all students who requested financial assistance had received money, the university spokesperson said “we are acutely aware of the challenges presented by the COVID-19 crisis and we have encouraged students to reach out for help if they need it.”

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