Higher Ed Groups: $14 Billion for Colleges, Universities in Stimulus Package Insufficient - Higher Education

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Higher Ed Groups: $14 Billion for Colleges, Universities in Stimulus Package Insufficient

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Higher education groups aren’t happy with the $14 billion earmarked for colleges and universities in the $2.2 trillion coronavirus stimulus package passed by the Senate late on Wednesday, saying institutions are facing severe cash flow problems and have been hit hard financially due to closures necessitated by the pandemic.

One group also said the absence of any measures to reduce student debt will not help borrowers’ mental and financial security.

The American Council on Education (ACE) and 10 other higher education groups had called for $50 billion in emergency aid for colleges and universities.

“While this legislation is an improvement from where the Senate started, the amount of money it provides to students and higher education institutions remains woefully inadequate,” said Ted Mitchell, ACE president, in a statement.

The Association of Public & Land Grant Universities (APLU) echoed Mitchell’s sentiments.

“We appreciate that the agreed upon bill evolved from its initial form, which included no direct funding to students and universities, to then $6 billion, and now a minimum of $14 billion for all of higher education with the possibility for some additional funds at the discretion of states. … However, the $14 billion provided for higher education falls far short of what is needed,” said the association in a statement.

Higher education groups have said that moving classes online – to eliminate in-person interactions – has and will continue to eat into institutions’ finances. Meanwhile, universities’ bottom lines are stressed as many are offering room and board refunds for students who have been asked to evacuate dormitories. College athletics have been canceled, which has meant another dependable revenue source is stymied. And many colleges, especially minority serving institutions (MSIs) like HBCUs, are taking on the responsibility of covering expenses for students from low-income backgrounds.

“It is critical that students receive support for needs such as finding housing, technology assistance for online learning, or to travel home,” said Mitchell. “Campuses are losing staggering sums after closing for safety reasons and refunding tuition, room and board, and other auxiliary revenues. If these needs are not met, students are going to suffer financially and may drop out.”

Ted Mitchell

Mitchell also said that while some relief has been given to those saddled with student loans, “there is more that could be done.” He’s referring to the stimulus package’s provision allowing the suspension of loan repayments for six months, until the end of September. The Department of Education had earlier offered just a 60-day suspension.

Another group, the Young Invincibles (YI), also said that more “proactive” measures should have been taken with regard to student debt – namely some debt cancellation.

“Something more proactive should be done, not just suspending payments but paying down some of those loans,” said Dr. Kyle Southern, YI’s higher education policy and advocacy director, to Diverse. “Yes, it’s more money in the pocket for now, but that bill will still be due come this fall. … If you’re looking to provide peace of mind in troubled times, just pressing pause on these things, we don’t think it brings mental or financial security.”

Dr. Kyle Southern

YI is pushing for canceling $10,000 of each borrower’s student debt. That’s also the minimum amount several Senate Democrats said needs to be canceled. House Democrats want as much as $30,000 in debt cancellation.

“43% of people have loan debt of $10,000 or less, but they are also in lower-income jobs. … We’ve identified [canceling] $10,000 as a really good start point to this conversation,” said Southern.

Because the future is uncertain, Southern said, canceling at least $10,000 in debt will have the most immediate effect for people already economically marginalized.

Mitchell also said far more is needed for student relief.

“… we cannot stress enough that overall, the assistance included in the measure for students and institutions is far below what is required to respond to the financial disaster confronting them,” he said.

Congress needs to do a lot more, said APLU.

“It’s critical that colleges and universities and their students receive much more robust support as future legislation is developed,” said APLU in a statement.

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