This page contains information related to the Higher Education Emergency Relief Funds III (HEERF III) created under the American Rescue Plan (ARP). 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 2020 and the CRRSA Act in late December 2020, can be found on NASFAA's COVID-19 Web Center. NASFAA has also created a comparison chart that outlines the requirements and allowable uses for all three HEERF fund allocations.
The American Rescue Plan (ARP) included additional COVID-19 relief for institutions of higher education. This new COVID stimulus bill included $40 billion, available through September 30, 2023, 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.
The ARP HEERF III funds require that 50% of an institution's funds be spent on student grants, with the exception of for-profit institutions, which must spend 100% of their funds on student grants. In addition, the allowable uses of funds are nearly identical to the CRRSA HEERF II funding as illustrated below.
Institutions may award student grants for:
Institutions may use the grants toward:
Defray expenses associated with coronavirus including:
Institutions must use a portion of their allocation for:
Q: Which students are eligible to receive HEERF III emergency funds?
A: Similar to the HEERF II funds, the HEERF III funds include no student eligibility requirements either. However, institutions are required to prioritize grants to students with exceptional financial need, such as those who receive Pell Grants. The HEERF III funds can be awarded to online students as well. To date, 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 for HEERF II funds because of the Personal Responsibility and Work Opportunity Reconciliation Act of 1996, which would presumably apply to HEERF III funds as well.
Q: I'm a proprietary school. What can I use my funds for?
A: While $396 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 III funds by a certain deadline?
A: Schools that previously received either HEERF I or HEERF II 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. ED has not yet issued guidance on the amount of time institutions have to begin drawing down HEERF III funds. Additionally, schools should not simply draw down it's entire HEERF III 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: 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 HEERF I guidance issued in ED's April 3 Electronic Announcement and from subsequent conversations with ED about HEERF II funds, that HEERF III grants awarded to students are not treated as EFA when packaging students. Likewise, HEERF III grants are not treated as taxable income or untaxed income for Title IV federal student aid purposes.
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.
Publication Date: 4/1/2021