This page contains information related to the Higher Education Emergency Relief Funds II (HEERF II) created under the Coronavirus Response and Relief Supplemental Appropriations Act (CRRSAA). The Department of Education (ED) has released initial guidance on the use of HEERF II grants but we expect more information in the coming days and weeks. Check back often as NASFAA will continue to update this reference page as any new guidance becomes available. Updates will be marked below in red. More information and resources on how the novel coronavirus is impacting student financial aid as well as information about the HEERF grants made available through the CARES Act in early March can be found on NASFAA's COVID-19 Web Center.
The Consolidated Appropriations Act, 2021 included additional COVID-19 relief through the Coronavirus Response and Relief Supplemental Appropriations (CRRSA) Act. This new COVID stimulus bill included $23 billion for higher education institutions and students, using the same Higher Education Emergency Relief Fund (HEERF) model established in the Coronavirus Aid, Relief and Economic Security (CARES) Act.
Unlike the CARES Act, the CRRSAA does not require that 50% of an institution's funds be spent on student grants. It does, however, require that institutions spend at least the same dollar amount on student grants as they were required to spend under the CARES Act. In addition, the allowable uses of funds are more flexible than in the CARES Act, as illustrated in the table below. Additionally, any unused CARES Act funds that an institution did not spend prior to December 27, 2020 may be spent in accordance with the allowable uses of the HEERF II Funds. However, institutions are still required to adhere to the 50/50 institutional/student share split for CARES Act funds spent after December 27, 2020.
Institutions may award student grants for:
Institutions may use the funds to:
Q: Which students are eligible to receive HEERF II emergency funds?
A: Notably, similar to CARES, the CRRSAA includes no student eligibility requirements, however, institutions are required to prioritize grants to students with exceptional financial need, such as those who receive Pell Grants. The HEERF II funds can be awarded to online students as well. As a reminder, after a confusing and inconsistent implementation, Education Secretary Betsy DeVos issued an Interim Final Rule (IFR) on June 17, 2020, limiting eligibility for CARES Act emergency financial aid grants to students who met the eligibility criteria for Title IV student aid under Section 484 of the Higher Education Act (HEA). ED has confirmed that the IFR does not apply to HEERF II funds, however they believe the Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA) of 1996, which prohibits certain noncitizens from receiving federal benefits, applies to HEERF II funds, making DACA, undocumented, and international students ineligible.) It's important to note that ED has not issued written guidance to clarify whether or not undocumented, DACA, or international students may receive these funds, however a Trump administration official stated verbally that these students were not eligible.
Q: I'm a proprietary school. What can I use my funds for?
A: While $681 million is allocated for use by for-profit, or proprietary institutions, any funds received by proprietary institutions would only be allowed to be used for emergency grants for students. See the chart above for allowable uses for students.
Q: Do I need to draw down my HEERF II funds by a certain deadline?
A: Schools that previously received Higher Education Emergency Relief Fund (HEERF) grant funds under the CARES Act (HEERF I funds) are required to start drawing down funds from both the student and institutional portions of HEERF II funds within 90 days of receiving their respective supplemental HEERF II award notifications.
Additionally, schools should not simply draw down it's entire HEERF II student and institutional allocations at once. All HEERF funds must be drawn down only as necessary to meet immediate cash need for spending the funds. That is, schools must spend funds for student grants within 15 calendar days of drawing down those funds from G5, whereas funds used for purposes other than the awarding of student grants must be spent within three calendar days of draw down.
Q: If I received funds through the CARES Act do I need to do anything to receive my new allocation?
A: While awards for institutions that previously received CARES Act HEERF funds will be processed automatically, ED indicated that this could take several weeks due to staffing and technology limitations. Institutions that have already submitted their HEERF annual report via the Annual Report Data Collection System will receive priority in supplemental funds disbursement. Institutions that did not receive either or both of the institutional share and student share of CARES Act funds will need to submit applications following the CARES Act process to receive supplemental allocations. New applications are due by April 15, 2021, but institutions are encouraged to apply as quickly as possible because ED indicated that they plan to process applications in the order they are received.
Q: What Is the deadline for schools to apply for Higher Education Emergency Relief Funds II?
A: For institutions that received HEERF I funds, applications are not required to receive supplemental awards under HEERF II. Public and nonprofit Institutions that did not previously receive CARES Act funding (HEERF I) must submit their applications for the CRRSAA student aid portion and institutional portion (HEERF II) by April 15, 2021. Likewise, proprietary institutions must submit their applications for the CRRSAA student aid portion by April 15, 2021, regardless if they have previously received funds under the CARES Act (HEERF I).
Q: How long does my institution have to spend our HEERF II funds?
A: An institution has one year from the date the school's supplemental grant was processed to distribute the HEERF II funds. For example, if a school's supplemental HEERF II funds were processed on January 20, 2021, the funds must be spent on or before January 19, 2022. If funds are not spent within the year allotted, a no-cost extension may be requested if applicable. Additionally, grants received by institutions that were created through the CARES Act in March of last year are still subject to their original one year deadline.
Q: Will HEERF emergency grants be counted as income for the calculation of Expected Family Contribution (EFC) or estimated financial assistance (EFA)?
A: It is NASFAA's understanding based on conversations with ED that HEERF II grants awarded to students under CRRSAA are also not treated as EFA when packaging students. Likewise, HEERF II grants are not treated as taxable income or untaxed income for Title IV federal student aid purposes.
Q: Can all enrolled students, as well as students enrolled at any point since the declaration of a national emergency (including undocumented, DACA, international, non-credit, refugee students, dual enrollment, continuing education, non-degree, and other non-Title IV eligible) receive HEERF II Funds?
A: Colleges can use HEERF II and unspent CARES funds to support certain students who are not Title IV eligible. That includes non-degree seeking, non-credit, dual enrollment, and continuing education students. The Department is exploring additional opportunities – including with other agencies - for colleges to support other vulnerable students (e.g., undocumented, DACA, and international students) during the national coronavirus pandemic emergency. As always, students have discretion about how they receive their grants and schools must receive affirmative consent from students before using an emergency financial aid grant to satisfy outstanding bills.
Q: Can students who have left school (for any reason) at any time since the declaration of the national emergency can receive HEERF I and HEERF II funds retroactively, as was allowed for students who had graduated using HEERF I funds?
A: Yes, schools may choose to make financial aid grants to students who have left school for any reason during the period of the national emergency beginning on March 13, 2020.
Q: Are employee benefits covered under “payroll” in section 314(c)(1) of CRRSAA?
A: Yes, colleges can use HEERF II funds and unspent HEERF I funds to pay for employee benefits for costs incurred on or after December 27, 2020. However, the Department’s current guidance is that colleges cannot currently use HEERF II funds to cover costs prior to December 27th, or use HEERF I funds under the expanded use of funds flexibility offered under CRRSAA for expenses incurred prior to that date. The Department will update the HEERF community of any change in interpretation through future guidance documents.
Q: If my school has unexpended CARES HEERF funds as of 12/27/2020, can those funds be spent using the CRRSAA flexibilities for payment periods before 12/27/2020 (the date the Act was signed into law)?
A: Yes, ED has clarified that institutions now have expanded flexibility to use unliquidated (unspent) funds effective December 27, 2020 (the date of enactment of the CRRSAA), for costs incurred on or after March 13, 2020, the date on which the President declared a national emergency due to the COVID-19 pandemic (85 FR 15337).
At the moment, the answers to the following questions remain unknown. NASFAA hopes to be able to address these questions in the near future and will update this reference page on a rolling basis as ED provides additional guidance. ED is aware that institutions are eagerly waiting on answers to additional questions, like using emergency grants for expenses incurred prior to Dec. 27th, offsetting lost revenue, and supporting undocumented, DACA, and international students. The Department is actively exploring these questions and will offer guidance soon.
Publication Date: 3/23/2021