ED's 'Evolving Communications' on Emergency Student Aid May Have Delayed Distribution, GAO Finds

By Owen Daugherty, NASFAA Staff Reporter

The Government Accountability Office (GAO) on Thursday released its report examining the federal government's response to the ongoing pandemic caused by the novel coronavirus, notably outlining the Department of Education’s (ED) “evolving communications” with regard to how it disbursed funds for emergency student aid to institutions to help offset financial hardships.

The report found the changing and often conflicting guidance and communication from ED “may have delayed schools’ distribution of funds to students.”

At the center of the communications issue that GAO highlighted is the discrepancy between ED’s two different messages regarding disbursement of the emergency grants to students. In an April 9 letter to schools, ED initially gave institutions “significant discretion on how to award the emergency aid to students.” However, on April 21 — after half of schools had already applied for funds — ED released an FAQ document stating students must be Title IV-eligible in order to receive the funds.

“These changes created challenges for schools, according to representatives of five higher education associations we contacted,” the GAO report found, and as NASFAA has previously reported. “Representatives from one association told us that some schools had already developed their plans for how to distribute the funds prior to the release of Education’s FAQ document, so they had to start their planning process over.”

Since ED issued its interim final rule doubling down on its position that only Title IV-eligible students can receive the funding, federal judges in both California and Washington state have issued preliminary injunctions on all or part of the rule.

The GAO report highlighted a survey from NASFAA conducted in May that found more than half of respondents said the new information regarding student eligibility greatly altered schools’ plans for distributing funds.

“This approach may exclude potentially eligible students who are also in need,” the GAO report stated. “For example, it may limit emergency aid to veterans, who are less likely to have applied for federal student aid, according to one veterans’ education organization.”

Furthermore, more than three-quarters of survey respondents reported that if not for ED’s April 21 FAQ document, they would not have restricted funds to only Title IV-eligible students.

In written comments responding to GAO’s findings, ED said the sections on its actions in response to the pandemic were "inaccurate, flawed, incomplete, and unfair."

GAO pushed back, however, noting that ED “did not identify any specific statement in this enclosure as inaccurate.” 

“We believe that we accurately described the key facts relating to Education’s implementation of the emergency student aid grants under the CARES Act,” GAO said.

The GAO report largely mirrors critique many have lodged at ED over the course of the department’s work to disburse the CARES Act funding to both institutions and students.

ED also took issue with GAO’s report, alleging it is “unfair and incomplete because GAO did not mention the Department's diligence enough.”

“More specifically, for this enclosure, Education noted that GAO did not convey the magnitude and speed under which its CARES Act grant work was completed,” the report stated.

Notably, GAO reported that ED felt there should not have been questions from institutions regarding which students are eligible for the emergency aid grants.

When previously defending its decision to restrict the funding to only students who are Title IV-eligible, ED has said it was simply implementing the law as Congress intended, a point several Democrats have pushed back on.

Further, ED said in the GAO report that its April 21 FAQ was not “legally binding at that time” and institutions that treated it as such and scrapped their initial distribution plans “ignored the flexibility of its communications.”

“However, [ED] did not clarify that its interpretation of student eligibility was not legally binding until May 21, [one] month after the release of the FAQ document,” the GAO report section on ED concluded. “Further, [ED] appears to intend its interpretation to be legally binding, as indicated by the issuance of the interim final rule.”


Publication Date: 6/26/2020

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