By Owen Daugherty, NASFAA Staff Reporter
A provision in the new infrastructure package currently making its way through Congress would rescind more than $350 million in unused money from the Higher Education Emergency Relief Fund (HEERF).
The $353.4 million of unobligated balances from the HEERF represents less than 1% of the total funding allocated for higher education institutions in the HEERF created by multiple federal coronavirus relief packages.
The funding was enacted in the Coronavirus Aid, Relief, and Economic Security (CARES) Act in March 2020 and the Coronavirus Response and Relief Supplemental Appropriations Act (CRRSAA) in December 2020.
The funding that would be rescinded as part of the infrastructure bill is funding that was allocated for institutions, but that schools never applied to receive. The rescission of funds wouldn’t affect balances already claimed by institutions.
There are other instances in the bipartisan infrastructure bill in which previously obligated but unused funds from relief packages are pulled, such as about $31 billion in unused funds from the Economic Injury Disaster Loan program. The New York Times reports as much as $200 billion in unused money from previous economic relief programs will go toward the more than $1 trillion infrastructure package.
Another offset included, meant to help pay for the infrastructure package, is the extension of the mandatory sequester for one additional year, meaning an increased origination fee for student loans will be in place for another year. The mandatory sequester and student loan origination fees will now be in place through fiscal year 2031. For fiscal year 2022, that extra fee imposed by the mandatory sequester brings in a total of $51 million to the federal government, according to the Committee for Education Funding. NASFAA has repeatedly called on Congress to eliminate student loan origination fees, which function as a hidden tax on students.
Publication Date: 8/17/2021